ALLIANCE BANKSHARES
CORPORATION
FORM OF STOCK OPTION
AGREEMENT
THIS STOCK OPTION
AGREEMENT (the “Agreement”), is entered into on [DATE
OF GRANT], by and between Alliance Bankshares Corporation, a
Virginia corporation (“Alliance”) and [GRANTEE] the
(“Grantee”), who is a key employee, consultant, or
director of Alliance.
WHEREAS, the Board
of Directors of Alliance Bank Corporation (the “Bank”)
adopted and ratified the Alliance Bank Corporation Stock Option
Plan (the “Plan”) effective as of March 24,
1999;
WHEREAS, effective
July 26, 2002, Alliance assumed both the Plan (which then
became the “Alliance Bankshares Corporation Stock Option
Plan”) and the outstanding options issued under the Plan in
connection with the reorganization by which Alliance became the
holding company for the Bank pursuant to an Agreement Plan of
Reorganization dated as of May 22, 2002 and a related Plan of
Share Exchange;
WHEREAS, the Plan
was amended and restated and further amended, effective
March 25, 2003 and April 27, 2005, respectively, by the
Alliance Board of Directors (the “Board”), which
amendment and restatement and further amendment were both approved
by Alliance’s shareholders;
WHEREAS, the Plan
provides for the granting of stock options by a committee to be
appointed by the Board (the “Committee”), subject to
the approval by the Board, to directors, consultants and key
employees of Alliance to purchase, or to exercise certain rights
with respect to, shares of the Common Stock of Alliance, par value
$4.00 per share (the “Stock”), in accordance with the
terms and provisions thereof; and
WHEREAS, the
Committee considers the Grantee to be a person who is eligible for
a grant of stock options under the Plan, and has determined that it
would be in the best interest of Alliance to grant the stock
options documented herein, and the Board has approved.
NOW, THEREFORE,
the parties hereto, intending to be legally bound hereby, agree as
follows:
Subject to the
terms and conditions hereinafter set forth, Alliance, with the
approval and at the direction of the Committee and the Board,
hereby grants to the Grantee, as of the Date of Grant shown on
Schedule I, a stock option of the type shown on
Schedule I, to purchase up to the number of shares of Stock
listed on Schedule I, at the price per share stated on
Schedule I, which is the fair market value of a share of the
Stock as of the Date of Grant as determined in good faith by the
Board, upon the recommendation of the Committee, pursuant to the
provisions of the Plan. Such option shall vest and become
exercisable in accordance with the vesting schedule set forth on
Schedule I provided the Grantee remains in the service of
Alliance on any such vesting date. Such option is hereinafter
referred to as the “Option” and the shares of stock
purchasable upon exercise of the Option are hereinafter sometimes
referred to as the “Option Shares”.
(a) Unless
terminated earlier pursuant to the other provisions of this
Agreement, the Option and all rights hereunder with respect
thereto, to the extent such rights shall not have been exercised,
shall expire and become null and void on the Expiration Date stated
on Schedule I or, if earlier, after the expiration of ten
(10) years from the Date of Grant (the “Option
Term”).
(b) Upon the
occurrence of the Grantee’s ceasing for any reason to be
employed by or in the continued service (i.e., as a director or
consultant) of Alliance, the Option, to the extent not previously
exercised, shall terminate and become null and void 1) immediately
if such termination of the Grantee’s employment or service
was for Cause; 2) twelve (12) months after the termination of
employment or service due to death or incapacity of the Grantee; or
3) three (3) months following the Grantee’s termination
of employment or service with Alliance for any other
reason.
(c) In no
event shall the date the Option is terminated extend beyond the
Option Term.
(d) In the
event of the death of the Grantee, the Option may be exercised by
the Grantee’s legal representative (s), but only to the
extent that the Option would otherwise have been exercisable by the
Grantee as of the date of his or her death.
(e) For
purposes of this Agreement, the term “Cause” shall mean
(i) any act of malfeasance or wrongdoing committed by the
Grantee affecting Alliance, (ii) any breach by Grantee of a
covenant not to compete, consulting contract or employment
contract, with Alliance, (iii) any act of disloyalty against
Alliance, (iv) any conduct, including but not limited to
conviction of a misdemeanor or felony, clearly tending to bring
discredit upon Alliance or (v) the refusal or manifest
inability of the Grantee to perform his or her duties and
obligations with Alliance. Whether “Cause” exists shall
be determined by the Committee subject to approval by the Board and
such determination shall be final and binding on the
Grantee.
(a) The
Grantee may exercise the Option on the exercise date, upon tender
of full payment of the exercise price, with respect to all or any
part of the number of Option Shares (then) exercisable in
accordance with the vesting schedule set forth in Schedule I
by giving the Secretary of Alliance written notice of intent to
exercise. The notice of exercise shall specify the number of Option
Shares as to which the Option is to be exercised and the date of
exercise thereof, which date shall be at least five days after
Alliance’s receipt of such notice unless an earlier time
shall have been mutually agreed upon.
(b) Full
payment (in U.S. dollars) by the Grantee of the option price for
the Option Shares purchased shall be made on or before the exercise
date specified in the notice of exercise in cash, or, with the
prior written consent of the Committee subject to approval by the
Board, in whole or in part through the surrender of previously
acquired shares of Stock, or shares that would otherwise be
acquired upon Option exercise, at their fair market value on the
exercise date.
On the exercise
date specified in the Grantee’s notice or as soon thereafter
as is practicable, Alliance shall cause to be delivered to the
Grantee, a certificate or certificates for the Option Shares then
being purchased (out of theretofore unissued Stock or
reac
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