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GERMAN AMERICAN BANCORP
1999 LONG-TERM EQUITY INCENTIVE PLAN
ARTICLE I
ESTABLISHMENT AND
PURPOSE
Section 1.01. Establishment and Term of Plan.
German American Bancorp, an Indiana corporation (the "Company"),
hereby establishes the German American Bancorp 1999 Long-Term
Equity Incentive Plan (the "Plan"), effective as of April 22, 1999,
subject to the approval of the Plan at the Company’s 1999
Annual Meeting of Shareholders.
Section 1.02. Purpose. The Plan is designed to
promote the interests of the Company, its subsidiaries, and its
shareholders by providing stock-based incentives to selected
Employees and Non-Employee Directors of the Company and its
subsidiaries who are expected to contribute materially to the
success of the Company and its subsidiaries. The purpose of the
Plan is to provide a means of rewarding performance and to provide
an opportunity to increase the personal ownership interest of
Employees and Non-Employee Directors in the continued success of
the Company. The Company believes that the Plan will assist its
efforts to attract and retain quality Employees and Non-Employee
Directors.
ARTICLE II
ADMINISTRATION
Section 2.01. Administrative Committee. The Plan
shall be administered by the Committee, which shall serve at the
pleasure of the Board of Directors, except that, for the purpose of
awards made to Non-Employee Directors, the full Board of Directors
shall serve as the Committee. The Committee shall have full
authority to administer the Plan, including authority to interpret
and construe any provision of the Plan and to adopt such rules and
regulations for administering the Plan as it may deem necessary to
comply with the requirements of the Plan or any applicable
law.
Section 2.02. Powers of the Committee. The
Committee shall, subject to the terms of this Plan, have the
authority to: (i) select the eligible Employees and Directors who
shall receive Awards, (ii) grant Awards, (iii) determine the types
and sizes of Awards to be granted to Employees and Directors under
the Plan, (iv) determine the terms, conditions, vesting periods,
and restrictions applicable to Awards, (v) adopt, alter, and repeal
administrative rules and practices governing this Plan, (vi)
interpret the terms and provisions of this Plan and any Awards
granted this Plan, (vii) prescribe the forms of any Award
Agreements or other instruments relating to Awards, and (viii)
otherwise supervise the administration of this Plan. The Committee
may delegate any of its authority to any other person or persons
that it deems appropriate with respect to Awards granted to
Employees who are not officers of the Company.
Section 2.03. Actions of the Committee. All
actions taken and all interpretations and determinations made in
good faith by the Committee, or made by any other person or persons
to whom the Committee has delegated authority, shall be final and
binding upon all Participants, the Company, and all other
interested persons. All decisions by the Committee (including
decisions made by the Board of Directors when serving as the
Committee) shall be made with the approval of not less than a
majority of its members. Members of the Committee who are eligible
for Awards may vote on any matters affecting the administration of
the Plan or the grant of any Awards pursuant to the Plan, except
that no such member shall act upon the granting of an Award to
himself or herself; but any such member may be counted in
determining the existence of a quorum of the Committee.
ARTICLE III
ELIGIBILITY
Any Employee or Director of the Company or any of
its Subsidiaries who is selected by the Committee to be a
Participant under the Plan shall be eligible for the grant of
Awards, except that only employees will be eligible to receive
Incentive Stock Options. The selection of the Employees and
Directors to receive Awards shall be within the discretion of the
Committee. More than one Award may be granted to the same Employee
or Director.
ARTICLE IV
SHARES SUBJECT TO
AWARDS
Section 4.01. Number of Common Shares. The shares
subject to the Awards and other provisions of the Plan shall be the
Company's authorized but unissued, or reacquired Common Shares. The
aggregate number of Common Shares that may be subject to Awards
granted under this Plan in any fiscal year shall be equal to the
sum of (i) one percent (1%) of the number of Common Shares
Outstanding as of the last day of the Company's prior fiscal year,
plus (ii) the number of Common Shares that were available for the
grant of Awards, but not granted, under this Plan in any previous
fiscal year; provided that in no event will the number of Common
Shares available for the grant of Awards in any fiscal year exceed
one-and-one-half percent (1 1/2%) of the Common Shares Outstanding
as of the last day of the prior fiscal year. The aggregate number
of Common Shares that may be issued under the Plan upon the
exercise of Incentive Stock Options is 425,000, as adjusted
pursuant to Section 4.02. No fractional shares shall be issued
under this Plan; if necessary, the Committee shall determine the
manner in which the value of fractional shares will be
treated.
The assumption of awards granted by an
organization acquired by the Company, or the grant of Awards under
this Plan in substitution for any such awards shall not reduce the
number of Common Shares available for the grant of Awards under
this Plan. Common Shares subject to an Award that is forfeited,
terminated or canceled without having been exercised shall again be
available for grant under this Plan, subject to the limitations
noted in the foregoing paragraph of this Section 4.01.
Section 4.02. Adjustment. In the event of any
change in the Common Shares by reason of a merger, consolidation,
reorganization, recapitalization or similar transaction, or in the
event of a stock split, stock dividend or distribution to
shareholders (other than normal cash dividends), spin-off or any
other change in the corporate structure of the Company, the
Committee may adjust the number and class of shares that may be
issued under this Plan, the aggregate number of Common Shares that
may be issued under the Plan upon the exercise of Incentive Stock
Options, the number and class of shares subject to outstanding
Awards, the exercise price applicable to outstanding Awards, and
the Fair Market Value of the Common Shares and other value
determinations applicable to outstanding Awards, if and to the
extent deemed appropriate. All determinations made by the Committee
with respect to adjustments under this Section 4.02 shall be
conclusive and binding for all purposes of the Plan.
ARTICLE V
AWARDS
Section 5.01. Grant of Awards. Awards authorized
under this Article V may be granted pursuant to another incentive
program which incorporates by reference the terms and conditions of
this Plan. Awards may be granted singly or in combination or tandem
with other Awards. Awards may also be granted in replacement of, or
in substitution for, other awards granted by the Company whether or
not such other awards were granted under this Plan; without
limiting the foregoing, if a Participant pays all or part of the
exercise price or taxes associated with an Award by the transfer of
Common Shares or the surrender of all or part of an Award
(including the Award being exercised), the Committee may, in its
discretion, grant a new Award to replace the Common Shares that
were transferred or the Award that was surrendered. The Company may
assume awards granted by an organization acquired by the Company or
may grant Awards in replacement of, or in substitution for, any
such awards.
Section 5.02. Types of Awards. Awards may
include, but are not limited to, the following:
(a) Stock Award. A Stock Award is a grant of
Common Shares or a right to receive Common Shares (or their cash
equivalent or a combination of both). All or part of any Stock
Award may be subject to conditions, restrictions and risks of
forfeiture, as and to the extent established by the Committee.
Stock Awards may be based on the Fair Market Value of the Common
Shares, or on other specified values or methods of valuation, as
determined by the Committee.
(b) Stock Option. A right to purchase a specified
number of Common Shares, during a specified period and at a
specified exercise price, all as determined by the Committee. A
Stock Option may be an Incentive Stock Option or a Non-Qualified
Stock Option. Incentive Stock Options may only be issued to
Employees. In addition to the terms, conditions, vesting periods,
and restrictions established by the Committee in the Award
Agreement, Incentive Stock Options must comply with the
requirements of Section 422 of the Code, Section 5.03(f), and this
Article V.
(c) Stock Appreciation Right. A right to receive
a payment, in cash or Common Shares, equal to the excess of (i) the
Fair Market Value or other specified valuation, of a specified
number of Common Shares on the date the right is exercised over
(ii) the Fair Market Value, or other specified valuation, on the
date the right is granted, all as determined by the Committee. The
right may be conditioned upon the occurrence of certain events,
such as a Change in Control, or may be unconditional, as determined
by the Committee.
Section 5.03. Terms and Conditions of Awards;
Agreements. Awards granted under the Plan shall be evidenced by an
Award Agreement executed by the Company and the Participant, which
shall contain such terms and be in such form as the Committee may
from time to time approve, subject to the following limitations and
conditions:
(a) Number of Shares. The Award Agreement shall
state, as appropriate, the type and total number of shares granted
under a Stock Award, and/or the type and total number of shares
with respect to which Stock Options and Stock Appreciation Rights
are granted.
(b) Award Prices. The Award Agreement shall
state, as applicable, the exercise price per share or other
operative value of the Common Shares covered by each Award. The
price or other value shall be determined by the Committee. For
Incentive Stock Options, the exercise price shall satisfy all of
the requirements of the Code and of
Section 5.03(f) of this Plan.
(c) Payment of Exercise Price; Deferral. The
exercise price of a Stock Option (other than an Incentive Stock
Option), and any Stock Award for which the Committee has
established an exercise price, may be paid in cash, by the transfer
of Common Shares, by the surrender of all or part of an Award
(including the Award being exercised), or by a combination of these
methods, as and to the extent permitted by the Committee. The
exercise price of an Incentive Stock Option may be paid in cash, by
the transfer of Common Shares, or by a combination of these
methods, as and to the extent permitted by the Committee at the
time of grant, but may not be paid by the surrender of all or part
of an Award. The Committee may prescribe any other method of paying
the exercise price that it determines to be consistent with
applicable law and the purpose of this Plan. With the approval of
the Committee, the delivery of the Common Shares, cash, or any
combination thereof subject to an Award may be deferred, either in
the form of installments or a single future delivery. The Committee
may also permit selected Participants to defer the payment of some
or all of their Awards, as well as other compensation, in
accordance with procedures established by the Committee to assure
that the recognition of taxable income is deferred under the Code.
The Committee may also establish rules and procedures for the
crediting of interest on deferred cash payments and dividend
equivalents on Awards.
(d) Issuance of Shares and Compliance with
Securities Laws. The Company may postpone the issuance and delivery
of certificates representing shares until (a) the admission of such
shares to listing on any stock exchange on which shares of the
Company of the same class are then listed, and (b) the completion
of such registration or other qualification of such shares under
any state or federal law, rule or regulation as the Company shall
determine to be necessary or advisable, which registrati
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