Exhibit 10.1
SUMMIT FINANCIAL GROUP, INC. 2009
OFFICER STOCK OPTION PLAN
FORM OF NON-QUALIFIED STOCK
OPTION GRANT AGREEMENT
(Installment Vesting)
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Grant of
Option. Subject to the
terms and conditions of this Non-Qualified Stock Option Grant
Agreement (“Agreement”) and the 2009 Officer Stock
Option Plan (“Plan”), dated ____________, 2009, which
has been adopted by SUMMIT FINANCIAL GROUP, INC., a West Virginia
corporation (“Corporation”) and which is incorporated
herein by reference, an Option to purchase a total of _____ shares
of $2.50 par value common stock of the Corporation’s Common
Stock at a price of ___________________ Dollars and ___ Cents
($______) per share is hereby granted to _____________________
(“Participant”) as of the date of this Agreement as
affixed below with its execution (“Date of
Grant”).
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Inclusion of
Parent, Subsidiary and Successor
Corporations. For purposes of this Agreement, employment by a
parent and or subsidiary of the Corporation shall be considered
employment by the Corporation. As used in this Section,
the term “Corporation” shall include the parent and all
present and future subsidiaries of the Corporation as defined in
Sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as
amended or replaced from time to time
(“Code”). This Agreement shall be binding
upon any successor or successors of the Corporation and reference
herein to the Corporation, unless clearly inapplicable, shall be
deemed to include any such successor or successors of the
Corporation.
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Non-Qualified Stock
Option. This
Option is not of the type described in Section 422(b) or 423(b) of
the Code (“Non-Qualified Stock Option”).
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Installment
Exercise. Subject to any limitations in the
Plan and Agreement, the Non-Qualified Stock Option shall become
vested and exercisable in five (5) installments for the following
percentage of the total number of Common Stock shares under the
Option, on or after the following Date of Vesting indicated, in
cumulative fashion:
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Number of Shares
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Date of Vesting
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Date of
Termination
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% Total Number of Common Stock
Shares Under Option
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a.
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b.
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c.
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d.
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e.
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f.
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g.
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h.
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i.
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j.
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Participant agrees to exercise the Option in
increments of not less than fifty (50) shares.
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The Option and
all rights granted under this Agreement with respect to the Option,
to the extent not previously exercised, shall terminate and become
null and void on and after the _______anniversary of the Date of
Vesting (“Termination Date”).
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Continuous
Employment Required . Except as otherwise provided in
this Section, a Participant may exercise Vested Options while he or
she is an employee if he or she has maintained since the date of
the grant of the Option continuous status as an
employee. An employment relationship will be treated as
continuing while the Participant is on military leave, sick leave
or other bona fide leave of absence if the period of leave does not
exceed ninety (90) days, or, if longer, the Participant’s
right to re-employment is guaranteed either by statute or by
contract. Employment shall be defined in accordance with
the provisions of Section 1.421-1(h) of the Income Tax Regulations
or any successor regulations, and if this Option shall be assumed
or a new Option substituted therefore in a transaction to which
Code Section 424(a) applies, employment by such successor
corporation shall be considered for all purposes of this Option to
be Employment by the Corporation.
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Termination . In the event of termination of the
employment of a Participant prior to the Termination Date by either
the Participant or the Corporation to whom an Option has been
granted under the Plan, other than a termination of employment by
reason of retirement (as defined in subsection (d) of this Section
5), permanent disability (as defined in subsection (e) of this
Section 5), or death, the Participant may exercise such Vested
Options until the earlier of (i) the expiration of the stated term
of the Option, or (ii) a period of one (1) year from the date of
such termination.
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Retirement . If a Participant’s continuous
employment with the Corporation terminates by reason of his or her
retirement, pursuant to the definition in the Plan, from the
Corporation at a retirement date authorized by the Committee prior
to the Termination Date, the retired Participant shall become one
hundred percent (100%) Vested in any installment of the Option not
yet one hundred percent (100%) Vested that Participant has been
granted under the Plan as of his or her date of retirement in
accordance with this subsection (d). A Participant may
exercise such Vested Options until the earlier of (i) the
expiration of the stated term of the Option, or (ii) for a period
of one (1) year from his or her retirement date.
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Permanent
Disability . If a Participant’s continuous
employment terminates prior to the Termination Date by reason of a
permanent disability, as defined in Code Section 22(e)(3) of the
Code, as amended from time to time, and as determined by the
Committee in its discretion based upon such documentation and
information as the Committee may require the Participant to submit
for purposes of establishing permanent disability pursuant to this
subsection (e) of Section 5, then such Option of the Participant
may be exercised with respect to the number of shares covered by
the Participant’s Option that were Vested immediately prior
to the date of such permanent disability as determined by the
Committee. Such Option of the permanently disabled
Participant may be exercised during t
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