PATAPSCO BANCORP, INC.
2000 STOCK OPTION & INCENTIVE PLAN
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Stock Option Agreement
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FOR INCENTIVE STOCK OPTIONS UNDER SECTION 422
OF THE INTERNAL REVENUE CODE
STOCK OPTION (the "Option") for a total of ______ shares of Common Stock,
par value $.01 per share, of Patapsco Bancorp, 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 Patapsco
Bancorp, Inc. 2000 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. Exercise Price. The exercise price per share is $______________, which
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equals 100% * of the fair market value, as determined by the Committee, of the
Common Stock on the date of grant of this Option.
2. Exercise of Option. This Option shall be exercisable in accordance with
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the Plan and the following provisions:
(i) Schedule of rights to exercise.
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Percentage of Total Shares
Years of Continuous Employment Subject to Option
After Date of Grant of Option Which My be Exercised
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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 100%
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* 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
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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 owned for more than six
months or such combination of cash and Common Stock owned for more than six
months as the Optionee elects. The certificate or certificates for shares of
Common Stock owned for more than six months 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
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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
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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
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manner otherwise than by will or the laws of descent or distribution. The terms
of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
2
5. Term of Option. This Option may not be exercisable for more than ten**
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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.
_________________________
Date of Grant PATAPSCO BANCORP, INC.
2000 STOCK OPTION & INCENTIVE PLAN COMMITTEE
By: ______________________________________
Authorized Member of the Committee
Witness: _________________________________
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** 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.
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INCENTIVE STOCK OPTION EXERCISE FORM
PURSUANT TO THE
PATAPSCO BANCORP, INC.
2000 STOCK OPTION & INCENTIVE PLAN
___________________
Date
Treasurer
Patapsco Bancorp, Inc.
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Re: Patapsco Bancorp, Inc. 2000 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 $.01, of Common Stock of Patapsco Bancorp, Inc.
under and pursuant to a Stock Option Agreement dated _______________, 20__.
Delivered herewith is a certified or bank cashier's or teller's check
and/or shares of Common Stock owned for more than six months, valued at the fair
market value of the stock on the date of exercise, as set forth below.
$___________ of cash or check
$___________ in the form of ________ shares of Common
Stock owned for more than six months, valued
at $___ per share
$0.00 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,
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