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Exhibit 10.5
INCENTIVE STOCK OPTION AGREEMENT
UNDER THE
PSB GROUP, INC.
2004 STOCK COMPENSATION PLAN
THIS
INCENTIVE STOCK OPTION AGREEMENT (the "Agreement") is made as of
this
_______________ day of ___________________, _____, between PSB
Group, Inc., a
Michigan corporation (the "Company"), ______ and (the
"Optionee").
WHEREAS, the Company wishes to further align the interests of the
Optionee
with those of shareholders;
WHEREAS, on ____________ (the "Grant Date"), the Committee for the)
PSB
Group, Inc. Stock Compensation Plan (the "Committee") granted
incentive stock
options to certain employees of the Company, including the
Optionee; and
WHEREAS, the parties desire to document the terms of stock option
grants;
NOW
THEREFORE, the parties agree as follows:
1.
GRANT OF OPTIONS. The Company has granted Incentive Stock Options
to
purchase 5,000 shares of Stock, which are intended to satisfy the
requirements
of Section 422 of the Internal Revenue Code, to the Optionee (the
"Options").
Once vested, each Option is exercisable at a price of $____ per
share of the
Company's Stock (the "Option Price").
2.
VESTING OF OPTIONS. Options are not exercisable until they vest.
Except
as otherwise provided herein, Options to purchase ________ shares
of Stock shall
be exercisable as of [1st Anniversary of Grant Date], Options to
purchase
________ shares of Stock shall be exercisable as of [2nd
Anniversary of Grant
Date] and Options to purchase ________ shares of Stock shall be
exercisable as
of [3rd Anniversary of Grant Date]. All Options which have not
previously vested
shall immediately vest and become fully exercisable upon the
Disability or death
of the Optionee. Upon the effective date of a Change in Control of
the Company,
all Options shall become fully and immediately exercisable.
3.
EXPIRATION OF OPTIONS. Unless otherwise determined by the
Committee, to
the extent not previously exercised, the Options will expire on the
earliest of,
(a) the tenth anniversary of the Grant Date; (b) ninety days after
the date that
the Optionee ceases to be an Eligible Participant for any reason
other than
Cause, death, Disability or Retirement; (c) immediately upon the
Optionee's
termination of employment for Cause; (d) one year after the date
that the
Optionee ceases to be an Eligible Participant by reason of such
person's
Retirement, death or Disability; provided, however, that the ISO
will convert to
an NSO if exercised more than twelve months after Disability or
more than three
months after Retirement.
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4.
OPTIONEE RIGHTS. No rights or privileges of a shareholder of the
Company
are conferred by reason of the granting of the Options. The
Optionee will not
become a shareholder of the Company with respect to the Option
Stock unless and
until the Options have been properly exercised and the Option Price
fully paid
for the number of the Options exercised.
5.
TRANSFERABILITY. The Options are not transferable, except by the
laws of
descent and distribution, however, the Committee has the discretion
to allow for
other Transfers of Options, but only to the extent provided in the
Plan and only
when such Transfer would be considered a completed gift for tax
purposes. If an
Option is transferred, it will continue to be subject to the terms
and
conditions of this Agreement, together with the Plan, and may not
be transferred
again. If the Options are transferable during the Optionee's
lifetime, the
Optionee will remain responsible for all applicable withholding
taxes upon the
exercise of any transferred Options and will, prior to transferring
any Options,
notify the Company of the anticipated Transfer. The Company shall
not be
required to provide to the transferee any notice of termination of
any of the
Options. If the Optionee transfers an Option and dies before a
transferred
Option has been exercised, the Option will automatically terminate
upon the
earlier of one year from the date of the Optionee's death or the
expiration of
the Option pursuant to this Agreement.
6.
COMPANY'S REPURCHASE OPTION AND OPTIONEE'S PUT OPTION.
(a)
The Company's Repurchase Option. In the event that Optionee
acquires
Option Stock pursuant to a valid exercise pursuant to this
Agreement, then the
Company shall have the right to repurchase such Option Stock upon
the Optionee
ceasing to be an Eligible Participant for any reason, provided that
the Company
determines that the Option Stock is not then readily tradable, as
such term is
used for purposes of the Peoples State Bank 401(k), Profit Sharing
Plan and
Employee Stock Ownership Plan (the "ESOP") and as determined
pursuant to Code
Section 401(a)(28)(C) ("Readily Tradable"). The repurchase price
per share shall
be the appraised value per share of the Company's common stock held
by the
Peoples State Bank 401(k), Profit Sharing Plan and ESOP as of the
appraisal date
that most recently precedes the date of the Company's election to
repurchase.
The Company may exercise its repurchase option at any time prior to
the later of
(i) 6 months following the Optionee's exercise of Options pursuant
to this
Agreement; or (ii) 6 months following the date on which the
Optionee ceases to
be an Eligible Person. Within 30 days following the date the
Company exercises
its repurchase option, the Optionee shall deliver any certificates
issued to
Optionee for such Option Stock and the Company shall pay Optionee
the purchase
price determined under this Section 6 within 7 days following the
date on which
the Company receives such certificates. The Optionee acknowledges
that the
failure to comply with Optionee's obligations under this Section
6(a) shall
cause the Company irreparable harm and agrees that the Company
shall be entitled
to specific performance and injunctive relief in addition to any
other relief to
which the Company may be entitled.
(b)
The Optionee's Put Option. In the event that Optionee acquires
Option
Stock pursuant to a valid exercise pursuant to this Agreement and
the Optionee
ceases to be an Eligible Participant, then the Participant, or the
Participant's
beneficiary shall have the right to require the
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Company to repurchase such Option Stock (the "Put Option"),
provided that the
Company determines that the Option Stock is not then Readily
Tradable. The
repurchase price shall be the appraised value of the Company's
common stock held
by ESOP as of the appraisal date that most recently precedes the
date of the
Optionee's election to repurchase. The Optionee may exercise
Optionee's Put
Option at any time prior to the later of (i) 6 months following the
Optionee's
exercise of Options pursuant to this Agreement; or (ii) 6 months
following the
date on which the Optionee ceases to be an Eligible Participant. In
order for
the exercise of a Put Option to be valid, the Optionee, concurrent
with the
exercise of the Put Option, must deliver any certificates issued to
Optionee for
such Option Stock. The Company shall pay Optionee the purchase
price determined
under this Section 6 within 7 days following the date on which the
Company
receives such certificates.
7.
TERMS OF OPTIONS. This Agreement, and the Options issued to the
Optionee, are subject to all of the terms and conditions set forth
herein and in
the Plan, as may be amended from time to time, a copy of which has
been provided
to Optionee. To the extent that any conflict may exist between any
term or
provision of this Agreement and any term or provision of the Plan,
the Plan
shall govern. Capitalized terms referenced, but not defined herein,
will have
the meaning attributed to them by the Plan. THE OPTIONEE
ACKNOWLEDGES THAT HE OR
SHE HAS READ THE PLAN AND AGREES TO BE BOUND BY ITS TERMS. Pursuant
to the Plan,
the Committee has authorized the Option Price and any applicable
tax withholding
liability associated with exercise of the Options to be payable in
cash, or by
netting or withholding Option Stock granted pursuant to the Options
being
exercised, subject to the Optionee's attestation that the Optionee
has, for at
least 6 months, owned Stock with a Fair Market Value equal to the
amount of the
exercise price due to the Company.
8.
MISCELLANEOUS. This Agreement, together with the Plan, sets forth
the
complete agreement of the parties concerning the subject matter
hereof,
superseding all prior agreements, negotiations and understandings.
Nothing
contained in this Agreement will confer upon the Optionee any right
with respect
to the continuation of his or her status as an Employee or an
Eligible
Participant. This Agreement shall be binding upon, and shall inure
to the
benefit of, the Company and the Optionee, and their respective
heirs, personal
legal representatives and successors. No change or modification of
this
Agreement shall be valid unless the same is in writing and signed
by the parties
hereto; provided, however, that the Optionee hereby covenants and
agrees to
execute any amendment to this Agreement which shall be required or
desirable (in
the opinion of the Company or its counsel) in order to comply with
the laws
governing this Agreement. This Agreement will be governed by the
substantive law
of the State of Michigan and may be executed in counterparts.
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the
date
first set
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forth above.
ATTEST:
PSB GROUP, INC.
By:
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Optionee:
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NONQUALIFIED STOCK OPTION AGREEMENT
UNDER THE
PSB GROUP, INC. STOCK COMPENSATION PLAN
(DIRECTOR AGREEMENT)
THIS
NONQUALIFIED STOCK OPTION AGREEMENT (the "Agreement") is made as
of
this _______________ day of ___________________, _____, between PSB
Group, Inc.,
a Michgan corporation (the "Company"), ______ and (the
"Optionee").
WHEREAS, the Company wishes to further align the interests of the
Optionee
with those of shareholders;
WHEREAS, on _____________ (the "Grant Date"), the Committee for the
PSB
Group, Inc. Stock compensation plan (the "Committee") granted
nonqualified stock
options to certain directors of the Company, including the
Optionee; and
WHEREAS, the parties desire to document the terms of stock option
grants;
NOW
THEREFORE, the parties agree as follows:
1.
GRANT OF OPTIONS. The Company has granted nonqualified stock
options to
purchase _____ shares of Stock to the Optionee (the "Options").
Once vested,
each Option is exercisable at a price of $______ per share of the
Company's
Stock (the "Option Price").
2.
VESTING OF OPTIONS. Except as otherwise provided herein, Options
to
purchase ______ shares of Stock shall be exercisable as of [1st
Anniversary of
Grant Date], Options to purchase ______ shares of Stock shall be
exercisable as
of [2nd Anniversary of Grant Date] and Options to purchase ______
shares of
Stock shall be exercisable as of [3rd Anniversary of Grant Date].
All Options
which have not previously vested shall immediately vest and become
fully
exercisable upon the Disability or death of the Optionee. Upon the
effective
date of a Change in Control of the Company, all Options shall
become full
