STOCK OPTION AGREEMENT
FOR INCENTIVE STOCK OPTIONS UNDER SECTION 422
OF THE INTERNAL REVENUE CODE
PURSUANT TO THE
FIRST LANCASTER BANCSHARES, INC.
1996 STOCK OPTION AND INCENTIVE PLAN
STOCK OPTION for a total of _________ shares of Common
Stock, par value $0.01 per share, of First Lancaster Bancshares,
Inc. (the "Company"), which Option is intended to qualify as an
incentive stock option under Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code"), is hereby granted to
____________________ (the "Optionee") at the price set forth
herein, and in all respects subject to the terms, definitions and
provisions of the First Lancaster Bancshares, Inc. 1996 Stock
Option and Incentive Plan (the "Plan") which was adopted by the
Company and which is incorporated by reference herein, receipt of
which is hereby acknowledged.
1. Option Price. The option price is $________ for
each share, being 100% * of the fair market value, as determined
by the Committee, of the Common Stock on the date of grant of
this Option.
2. Exercises of Option. This Option shall be exercisable
in accordance with provisions of the Plan as follows:
(i) Schedule of rights to exercise.
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Years of Continuous Percentage of Total Shares
Employment After Subject to Option Which May
Date of Grant of Option Be Exercised
----------------------- ---------------------------
Upon Grant 0%
1 year but less than 2 years 20%
2 years but less than 3 years 40%
3 years but less than 4 years 60%
4 years but less than 5 years 80%
5 years or More 100%
_____________
* 110% in the case of an Optionee who owns shares representing
more than 10% of the outstanding common stock of the Company on
the date of grant of this Option.
(ii) Method of Exercise. This Option shall be
exercisable by a written notice by the Optionee which shall:
(a) state the election to exercise the Option, the
number of shares with respect to which it is being
exercised, the person in whose name the stock certificate or
certificates for such shares of Common Stock is to be
registered, his address and Social Security Number (or if
more than one, the names, addresses and Social Security
Numbers of such persons);
(b) contain such representations and agreements as to
the holder's investment intent with respect to such shares
of Common Stock as may be satisfactory to the Company's
counsel;
(c) be signed by the person or persons entitled to
exercise the Option and, if the Option is being exercised by
any person or persons other than the Optionee, be
accompanied by proof, satisfactory to counsel for the
Company, of the right of such person or persons to exercise
the Option; and
(d) be in writing and delivered in person or by
certified mail to the Treasurer of the Company.
Payment of the purchase price of any shares with respect to
which the Option is being exercised shall be by cash, Common
Stock, or such combination of cash and Common Stock as the
Optionee elects. The certificate or certificates for shares of
Common Stock as to which the Option shall be exercised shall be
registered in the name of the person or persons exercising the
Option.
(iii) Restrictions on exercise. This Option may not be
exercised if the issuance of the shares upon such exercise would
constitute a violation of any applicable federal or state
securities or other law or valid regulation. As a condition to
the Optionee's exercise of this Option, the Company may require
the person exercising this Option to make any representation and
warranty to the Company as may be required by any applicable law
or regulation.
3. Withholding. The Optionee hereby agrees that the
exercise of the Option or any installment thereof will not be
effective, and no shares will become transferable to the
Optionee, until the Optionee makes appropriate arrangements with
the Company for such tax withholding as may be required of the
Company under federal, state, or local law on account of such
exercise.
4. Non-transferability of Option. This Option may not
be transferred in any manner otherwise than by will or the laws
of descent or distribution, or pursuant to a "qualified domestic
relations order" (within the meaning of Section 414(p) of the
Code and the regulations and rulings thereunder). The terms of
this Option shall be binding upon the executors, administrators,
heirs, successors and assigns of the Optionee.
5. Term of Option. This Option may not be exercisable
for more than ten ** years from the date of grant of this Option,
as stated below, and may be exercised during such term only in
accordance with the Plan and the terms of this Option.
FIRST LANCASTER BANCSHARES, INC.
1996 STOCK OPTION AND INCENTIVE PLAN
COMMITTEE
By _____________________________
_________________
Date of Grant Attest: ________________________ (Seal)
____________
** Five years in the case of an Optionee who owns shares
representing more than 10% of the outstanding common stock of the
Company on the date of grant of this Option.
INCENTIVE STOCK OPTION EXERCISE FORM
PURSUANT TO THE
FIRST LANCASTER BANCSHARES, INC.
1996 STOCK OPTION AND INCENTIVE PLAN
_________________
Date
Treasurer
First Lancaster Bancshares, Inc.
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Re: First Lancaster Bancshares, Inc. 1996 Stock Option
and Incentive Plan
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Dear Sir:
The undersigned elects to exercise the Incentive Stock
Option to purchase ___________ shares, par value $0.01, of Common
Stock of First Lancaster Bancshares, Inc. under and pursuant to
a Stock Option Agreement dated _____________, 199__.
Delivered herewith is a certified or bank cashier's or
teller's check and/or shares of Common Stock, valued at the fair
market value of the stock on the date of exercise, as set forth
below.
$_______ of cash or check
_______ ____ shares of Common Stock, valued
at $____ per share
$ Total
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The name or names to be on the stock certificate or
certificates and the address and Social Security Number of such
person(s) is as follows:
Name _________________________________________________________
Address ______________________________________________________
Social Security Number _______________________________________
Very truly yours,
____________________________