TD BANKNORTH INC. NONQUALIFIED STOCK OPTION AGREEMENT AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN
Exhibit 10.3
Non-employee directors
TD BANKNORTH INC.
NONQUALIFIED STOCK OPTION AGREEMENT
AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN
1. GRANT OF OPTION:
TD BANKNORTH INC. (the “Company”), granted to ___(the “Optionee”), effective ___ ___, ___(the “Grant Date”), an option (the “Option”), to purchase an aggregate of ___shares of the Company’s Common Stock, $0.01 par value (“Shares” of “Stock”), at a price of $ per share. The Shares subject to the Option are sometimes referred to as the “Option Shares.” The Option has been granted pursuant to the Company’s Amended and Restated 2003 Equity Incentive Plan (the “Plan”), and is subject to the terms and conditions of this Agreement and of the Plan. Capitalized terms not separately defined herein shall be defined as provided in the Plan. The Company and its Affiliates are referred to collectively as the “Group.” This option is not intended to be an Incentive Stock Option as described in Section 422 of the Internal Revenue Code of 1986 as amended (the “Code”).
2. BASIC TERMS OF OPTION:
| (a) | Term: This Option shall extend from the Grant Date until the date immediately preceding the tenth anniversary of the Grant Date (the “Expiration Date”). | |||
| (b) | Schedule of Exercisability: Except as otherwise specifically provided in this Agreement, this Option shall be fully exercisable in whole or in part commencing on the Grant Date through and including the Expiration Date. The Option shall in all events expire on the Expiration Date (unless sooner exercised or terminated) and may not be exercised at any time thereafter. | |||
| (c) | Exercise Following Termination of Service: | |||
| (i) | If the Optionee ceases to be a non-employee director of any member of the Group on account of Retirement (as defined below), then the Option shall remain exercisable until the earlier of the third anniversary of the date the Optionee’s Service terminates or the Expiration Date, and shall then expire. | |||
| For purposes of this Agreement, “Retirement” means voluntary termination of Service with the Group after the Optionee has attained age 72. | ||||
| (ii) | Notwithstanding any other provision of this Agreement, in the event an Optionee’s Service terminates following a Change of Control, the Option shall remain exercisable until the earlier of the third anniversary of the date the Optionee’s Service terminates or the Expiration Date, and shall then expire. | |||
| (iii) | If the Optionee ceases to be a non-employee director of any member of the Group for any reason not covered by clauses (i) and (ii) above, then the Option shall remain exercisable until the earlier of the first anniversary of the date the Optionee’s Service terminates or the Expiration Date, and shall then expire. |
3. EXERCISE OF OPTION:
Subject to the conditions set forth in this Agreement, this Option may be exercised by the Optionee’s delivery of written notice of exercise to the Secretary of the Company, specifying the number of whole Option Shares to be purchased and the purchase price to be paid therefor. The Optionee may purchase less than the number of Option Shares covered hereby, provided that no partial exercise of this Option may be for any fractional Share. The Company shall then schedule a closing date as soon as practicable, but no later than thirty (30) business days following receipt of such notice. Unless otherwise agreed by the Committee or the Board, payment of the purchase price for Shares purchased upon exercise of the Option shall be made by delivery to the Company of cash or a certified or bank check to the order of the Company in an amount equal to the purchase price of such Shares; or by delivery of a properly executed exercise notice, together with irrevocable instructions to a broker directing the broker to sell the Shares and then to properly deliver to the Company the amount of sale or loan proceeds to pay the exercise price, all in accordance with the regulations of the Federal Reserve Board. As a condition to any exercise of the Option, the Optionee shall make arrangement, reasonably acceptable to the Company, for withholding of any tax or other amount required to be withheld under any applicable law in connection with the exercise of the Option. The Company shall, upon payment of the option price for the number of Shares purchased, and delivery of a subscription agreement in form satisfactory to the Board, make prompt delivery of such Shares to the Optionee, provided that if any law or regulation requires the Company to take any action with respect to such Shares before the issuance thereof, then the date of delivery of such Shares shall be extended for the period necessary to complete such action. No shares shall be issued and delivered upon exercise of any option unless and until, in the opinion of counsel for the Company, any applicable registration requirements of the Securities Act of 1933, any applicable listing requirements of any national securities exchange on which stock of the same class is then listed, or any other requirements of law or of any regulatory bodies having jurisdiction over such issuance and delivery, shall have been fully complied with.
4. NONTRANSFERABILITY OF OPTION:
| (a) | During the Optionee’s lifetime, the Option may be exercised only by the Optionee. The Option shall not be sold, transferred, assigned, pledged, hypothecated, attached, executed upon or otherwise disposed of in any way (whether by operation of law or otherwise), in whole or in part. | |||
| (b) | If the Optionee should die while serving as a non-employee director of any member of the Group, the Option may be exercised by the person designated in the Optionee’s will or, in the absence of such designation, by the Optionee’s estate, to the extent provided herein. | |||
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| (c) | If the spouse of the Optionee has or shall have acquired a community property interest in the Option, the Optionee (or permitted successors-in-interest upon the Optionee’s death) may exercise the Option on behalf of the spouse of the Optionee, or such spouse’s successor-in-interest. |
5. NO SPECIAL RIGHTS:
The Optionee shall have no rights as a shareholder with respect to any Shares which may be purchased by exercise of this Option unless and until a certificate representing such Shares is duly issued and delivered to the Optionee. No adjustment shall be made for dividends or other rights for which the record date is prior to the date such stock certificate is issued.
6. WITHHOLDING TAXES:
The Company’s obligation to deliver Shares upon the exercise of this Option shall be subject to the Optionee’s satisfaction of any applicable federal, state and local income and employment tax withholding requirements.
7. MISCELLANEOUS:
| (a) | Except as provided herein, this Option may not be amended or otherwise modified unless evidenced in writing and signed by the Company and the Optionee. In the event that the Board determines, after a review of Section 409A of the Code and all applicable Internal Revenue Service guidance, that the Plan or any provision thereof or Award thereunder should be amended to comply with Section 409A of the Code, the Board may amend the Plan and this Agreement to make any changes required to comply with Section 409A of the Code. | |||
| (b) | All rights and obligations of the Company and the Optionee are subject to the terms and conditions of the Plan. In the event of any conflict between the terms of the Plan and the terms of this Agreement, the terms of the Plan shall govern. The number of Shares and the exercise price are subject to adjustment as provided in the Plan. | |||
| (c) | Neither Shares acquired on exercise of the Option, nor the Option, nor any interest in either of them, may be sold, assigned, pledged, hypothecated, encumbered or in any other manner transferred or disposed of, in whole or in part, except in compliance with the terms, conditions and restrictions as set forth in the Certificate of Incorporation of the Company, the Plan, applicable federal and state securities laws or any other applicable laws or regulations or listing requirements and the terms and conditions hereof. | |||
| (d) | The authority to interpret and administer this Agreement shall be vested in the Board, and the Board shall have all powers with respect to this Agreement as it has with respect to the Plan. Any interpretation of the Board of the provisions of the Plan or this Agreement made in good faith shall be final and binding on all parties. | |||
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| (e) | This Agreement does not confer on the Optionee any right with respect to continuance of Service with the Company or any Affiliate, nor shall it interfere in any way with any right the Company or any Affiliate would otherwise have to terminate or modify the terms of the Participant’s Service at any time. | |||
| (f) | The Optionee agrees that no member of the Board or the Company or its Affiliates shall be personally liable for any actions taken in good faith in connection with the Plan or this Agreement. | |||
| (g) | This Option shall be governed by and construed in accordance with the laws of the State of Delaware. | |||
| TD BANKNORTH INC. | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| Optionee: | ||||
| Name: | ||||
| Date: | ||||
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