SUCCESS BANCSHARES, INC.
STOCK OPTION AGREEMENT
(NON-TRANSFERABLE)
Success Bancshares, Inc., a Delaware corporation (the _Company_), hereby
grants to Frank L. Baasch (the _Optionee_) an option to purchase a total of
3,000 shares of Common Stock (the _Shares_) of the Company, at the price set
forth herein, and in all respects subject to the terms and provisions of the
Company's 1999 Stock Option Plan (the _Plan_) applicable to stock options
which terms and provisions are hereby incorporated by reference herein.
Unless otherwise defined or the context herein otherwise requires, the
capitalized terms used herein shall have the same meanings ascribed to them in
the Plan.
1. DATE OF GRANT; TERM OF OPTION. This Option is granted as of August 23,
2000, and it may not be exercised later than August 23, 2010.
2. OPTION EXERCISE PRICE. The Option exercise price is $12.00 per Share,
which price is not less than the Fair Market Value (as defined in the Plan)
thereof on the date this Option was granted.
3. EXERCISE OF OPTION. This Option shall be exercisable during its term
only in accordance with the terms and provisions of the Plan and this Option
as follows:
(a) RIGHT TO EXERCISE. The total number of Shares subject to this
Option is 3,000. Subject to the foregoing and the limitations contained
herein and in the Plan, this Option shall vest and be exercisable,
cumulatively, as follows;
Number of Share Exercisable First Date Option is Exercisable
3,000 August 23, 2001
provided, however, that, upon any Corporate transaction (as defined in the
Plan), this Option shall become immediately exercisable as to all shares
remaining subject to this Option and all restrictions on vesting shall
terminate.
(b) METHOD OF EXERCISE. This Option shall be exercisable by written
notice which shall state the election to exercise this Option, the number of
Shares in respect to which this Option is being exercised and such other
representations and agreements as to the Optionee's investment intent with
respect to such Shares as may be required by the Company hereunder or pursuant
to the provisions of the Plan. Such written notice shall be signed by the
Optionee and shall be delivered in person or by certified mail to the
Secretary of the Company or such other person as may be designated by the
Company. The written notice shall be accompanied by payment of the exercise
price. The exercise price may be paid: (i) in cash; (ii) by check; (iii)
tendering (either actually or, if and so long as the Common Stock is
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registered under Section 12(b) or 12(g) of the Securities Exchange Act of
1934, as amended (the _Exchange Act_), by attestation) Common Stock already
owned by the Optionee for at least six months (or any shorter period necessary
to avoid a charge to the Company's earnings for financial reporting purposes)
having a Fair Market Value on the day prior to the exercise date equal to the
aggregate Option exercise price or by transferring shares of Common Stock
having a Fair Market Value on the day prior to the exercise date equal to the
aggregate Option exercise price to the Company's transfer agent for delivery
to the Company provided that the written notice of exercise is accompanied by
a written acknowledgment by the Optionee that the Optionee has instructed his
broker dealer to transfer such shares and such transfer is confirmed by a
letter from a broker dealer acknowledging that the Optionee has directed such
broker dealer to transfer such shares; or (iv) if and so long as the Common
Stock is registered under Section 12(b) or 12(g) of the Exchange Act, deliver
of a properly executed exercise notice, together with irrevocable
instructions, to (A) a brokerage firm designated by the Company to deliver
promptly to the Company the aggregate amount of sale or loan proceeds to pay
the Option exercise price and any withholding tax obligations that may arise
in connection with the exercise and (B) the Company to deliver the
certificates for such purchased shares directly to such brokerage firm, all in
accordance with the regulations of the Federal Reserve Board. In addition,
the exercise price for shares purchased under this Option may be paid, either
singly or in combination with one or more of the alternative forms of payment
authorized by this Section 3(b), by such other consideration as the Board may
permit. Upon receipt of payment, the Company shall deliver to Optionee or the
person exercising this Option for Optionee, an appropriate certificate or
certificates for fully paid nonassessable Shares. For purposes of clause
(iii), should any Optionee fail to have the number of shares required to pay
the exercise price delivered to the Company'' transfer agent within 90 days,
this Option, with respect to the number of shares stated in the written
notice, will terminate and be deemed to be forfeited by the optionee. The
certificate or certificates for the Shares as to which the Option shall be
exercised shall be registered in the name of the Optionee and shall be
legended as set forth in the Plan and/or as required under applicable law.
This Option may not be exercised for a fraction of a share.
(c) RESTRICTIONS ON EXERCISE. This Option may not be exercised if the
issuance of the Shares upon such exercise would constitute a violation of any
applicable federal or state securities laws or other laws or regulations. As
a condition to the exercise of this Option, the Company may require the
Optionee to make such representations and warranties to the Company as may be
required by any applicable law or regulation.
(d) NO SHAREHOLDER RIGHTS BEFORE EXERCISE AND ISSUANCE. No rights as a
shareholder shall exist with respect to the Shares subject to the Option as a
result of the grant of the Option. Such rights shall exist only after
issuance of a stock certificate following the exercise of the Option as
provided in this Agreement and the Plan.
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(e) TERMINATION OF EMPLOYMENT. In the event that the Optionee ceases to
be a non-employee Director of the Company or its Subsidiary (as defined in the
Plan), the exercisability of the Option is subject to the provisions of
Section 7.6 of the Plan.
4. INVESTMENT REPRESENTATIONS. In connection with the acquisition of this
Option, the Optionee represents and warrants as follows:
(a) The Optionee is acquiring this Option, and upon exercise of this
Option, he will be acquiring the Shares, for investment for his own account,
not as a nominee or agent, and not with a view to, or for resale in connection
with, any distribution thereof.
(b) The Optionee has a preexisting business or personal relationship with
the Company or one of its directors, officers or controlling persons and by
reason of his business or financial experience, has, and could be reasonably
assumed to have, the capacity to evaluate the merits and risks of purchasing
Common Stock of the Company and to make an informed investment decision with
respect thereto and to protect Optionee's interest in connection with the
acquisition of this Option and the Shares.
5. WITHHOLDING. The Company reserves the right to withhold, in accordance
with any applicable laws, from any compensation or other consideration payable
to the Optionee, any taxes required to be withheld by federal, state or local
law as a result of the grant or exercise of this Option or the sale or other
disposition of the Shares issued upon exercise of this Option; and, if such
compensation or consideration is insufficient, the Company may require
Optionee to pay to the Company an amount sufficient to cover such withholding
tax liability.
6. TRANSFERABILITY OF OPTION. This Option may not be assigned, pledged or
transferred by the Optionee other than by will or by the applicable laws of
descent and distribution, and, during the Optionee's lifetime, this Option may
be exercised only by the Optionee or a permitted assignee or transferee of the
Optionee (as provided below). Notwithstanding the foregoing, and to the
extent permitted by Section 422 of the Internal Revenue Code of 1986, as
amended, the Board, in its sole discretion, may permit such assignment,
transfer and exercisability and may permit the Optionee to designate a
beneficiary who may exercise this Option after the Optionee's death; provided,
however, that in such event this Option if so assigned or transferred shall be
subject to all the same terms and conditions contained in this Stock Option
Agreement.
7. CONTINUATION OF EMPLOYMENT. Neither the Plan nor this Option shall (a)
confer upon the Optionee any right whatsoever to continue to serve as a non-
employee Director of the Company or any Subsidiary or (b) limit or restrict in
any respect the rights of the Company, which rights are hereby expressly
reserved, to terminate the Optionee's service as a non-employee Director and
any compensation being paid to Optionee at any time for any reason whatsoever,
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with or without cause, in the Company's sole discretion and with or without
notice.
8. THE PLAN. This Option is subject to, and the Company and the Optionee
agree to be bound by, all the terms and conditions of the Company's Plan as
such Plan may be amended from time to time in accordance with the terms
thereof, provided that no such amendment shall deprive the Optionee, without
his consent, of this Option or any rights hereunder. Pursuant to the Plan,
the Board is authorized to adopt rules and regulations not inconsistent with
the Plan as it shall deem appropriate and proper. A copy of the Plan in its
present form is available for inspection at the Company's principal office
during business hours by the Optionee or the persons entitled to exercise this
Option.
9. ENTIRE AGREEMENT. The terms of this Agreement and the Plan constitute
the entire agreement between the Company and the Optionee with respect to the
subject matter hereof and supersede any and all previous agreements between
the Company and the Optionee.
SUCCESS BANCSHARES, INC., a Delaware corporation
Dated as of: August 23, 2000 By: ___________________________________
Name: Wilbur G. Meinen, Jr.
Title: Chairman, President and CEO
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The Optionee hereby acknowledges receive of a copy of the Plan, a copy of
which is attached hereto, and represents that he has read and is familiar with
the terms and provisions thereof and of this Agreement, and hereby accepts
this Option subject to all of the terms and provisions thereof and of this
Agreement. Optionee hereby agrees to accept as binding, conclusive and final
all decisions or interpretations of the Board upon any questions arising under
the Plan.
Dated as of:
____________________________________
Signature of Optionee
____________________________________
Address
____________________________________
City State Zip Code
THIS OPTION AND THE SECURITIES WHICH MAY BE PURCHASED UPON EXECUTION OF
THIS OPTION ARE SUBJECT TO THE RESTRICTIONS ON TRANSFERABILITY SET FORTH IN
RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, TO THE
EXTENT THAT THEY ARE HELD BY AFFILIATES OF THE COMPANY.
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