<PAGE>
As filed with the Securities and Exchange Commission on May 15, 1998
Registration No.________
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------
Form S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
-------------------
BYL BANCORP
(Exact name of issuer as specified in its charter)
California 33-0755794
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
18206 Imperial Highway, Yorba Linda,
California 92886 (Address of principal
executive offices)
BYL BANCORP 1997 STOCK OPTION PLAN
(Full title of the plan)
Robert Ucciferri
President and Chief Executive Officer
BYL Bancorp
18206 Imperial Highway
Yorba Linda, California 92886
(Name and address of agent for service)
(714) 996-1800
(Telephone number, including area code, of agent for service)
Copy to:
Loren P. Hansen, Esquire
Knecht & Hansen
1301 Dove Street, Suite 900
Newport Beach, California 92660
1
<PAGE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
- -----------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES TO AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
BE REGISTERED REGISTERED(1) SHARE(2) PRICE REGISTRATION FEE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, No Par
Value 460,519 $23.00 $10,591,937 $3,124.62
- -------------------------- ------------------------ ----------------------- ------------------------ -----------------------
</TABLE>
EXPLANATORY NOTE
_______________
(1) This Registration Statement covers, in addition to the number of shares
of Common Stock stated above, such indeterminate number of shares as
may become subject to options under the BYL Bancorp 1997 Stock Option
Plan.
(2) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(g).
2
<PAGE>
In accordance with the Note to Part I of the Form S-8, the information
specified by Part I has been omitted from this Registration Statement.
3
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 3. Incorporation of Documents by Reference. The Company
hereby incorporates by reference into this Registration Statement the
following documents:
(a) The BYL Bancorp Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1997.
(b) All other reports filed with the Securities and Exchange Commission
("Commission") pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934, as amended ("1934 Act"), since December 31, 1996.
(c) The description of the Common Stock contained in the Company's
Registration Statement on Form S-4 that was filed with the Commission on
September 5, 1997 (file number 333-34995) and the Company's Registration
Statement on Form S-4 that was filed with the Commission on February 27, 1998
(file number 333-47013).
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the 1934 Act prior to the filing of a
post-effective amendment which indicates that all securities have been sold or
which deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference in this Registration Statement and to be a part hereof
from the date of filing such documents.
ITEM 4. Description of Securities.
Inapplicable
ITEM 5. Interests of Named Experts and Counsel.
Inapplicable
ITEM 6. Indemnification of Directors and Officers.
Section 3.15 of the Company's Bylaws provides as follows:
(a) The corporation shall, to the maximum extent and in the manner
permitted by the California Corporations Code (the "Code"), indemnify each of
its directors against expenses (as defined in Section 317(a) of the Code),
judgments, fines, settlements, and other amounts actually and reasonably
incurred in connection with any proceeding (as defined in Section 317(a) of the
Code), arising by reason of the fact that such person is or was an agent of the
corporation. For purposes of this Section 3.15, a "director" of the corporation
includes any person (i) who is or was a director of the corporation, (ii) who is
or was serving at the request of the corporation as a director of another
corporation, partnership, joint venture, trust or other enterprise, or (iii) who
was a director of a
4
<PAGE>
corporation which was a predecessor corporation of the corporation or of another
enterprise at the request of such predecessor corporation.
(b) The corporation shall have the power, to the extent and in the
manner permitted by the Code, to indemnify each of its officers, employees and
agents against expenses (as defined in Section 317(a) of the Code), judgments,
fines, settlements, and other amounts actually and reasonably incurred in
connection with any proceeding (as defined in Section 317(a) of the Code),
arising by reason of the fact that such person is or was an officer, employee or
agent of the corporation. For purposes of this Section 3.15, an "officer",
"employee" or "agent" of the corporation includes any person (i) who is or was
an officer, employee, or agent of the corporation, (ii) who is or was serving at
the request of the corporation as an officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, or (iii) who
was an officer, employee or agent of the corporation which was a predecessor
corporation of the corporation or of another enterprise at the request of such
predecessor corporation.
(c) Expenses incurred in defending any civil or criminal action or
proceeding for which indemnification is required pursuant to Section 3.15 shall
be paid by the corporation in advance of the final disposition of such action or
proceeding upon receipt of an undertaking by or on behalf of the indemnified
party to repay such amount if it shall ultimately be determined that the
indemnified party is not entitled to be indemnified as authorized in this
Section 3.15. Expenses incurred in defending any civil or criminal action or
proceeding for which indemnification is permitted pursuant to Section 3.15 may
be paid by the corporation in advance of the final disposition of such action or
proceeding upon receipt of an undertaking by or on behalf of the indemnified
party to repay such amount if it shall ultimately be determined that the
indemnified party is not entitled to be indemnified as authorized in this
Section 3.15.
(d) The indemnification provided by this Section 3.15 shall not be
deemed exclusive of any other rights to which those seeking indemnification may
be entitled under any bylaw, agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in an official capacity and as to
action in another capacity while holding such office, to the extent that such
additional rights to indemnification are authorized in the Articles of
Incorporation.
(e) The corporation shall have the power to purchase and maintain
insurance on behalf of any person who is or was an agent of the corporation
against any liability asserted against or incurred by such person in such
capacity or arising out of such person's status as such, whether or not the
Corporation would have the power to indemnify him against such liability under
the provisions of this Section 3.15.
(f) No indemnification or advance shall be made under this Section
3.15, except where such indemnification or advance is mandated by law or the
order, judgment or decree of any court of competent jurisdiction, in any
circumstance where it appears:
(1) That it would be inconsistent with a provision of the Articles of
5
<PAGE>
Incorporation, these bylaws, a resolution of the shareholders or an agreement in
effect at the time of the accrual of the alleged cause of the action asserted in
the proceeding in which the expenses were incurred or other amounts were paid,
which prohibits or otherwise limits indemnification; or
(2) That it would be inconsistent with any condition expressly imposed
by a court in approving a settlement.
Section 204 of the California Corporations Code allows a corporation to
adopt a partial exemption from liability of its directors. New subsections (10)
and (11) of Section 204(a) of the California Corporations Code permit the
Articles of Incorporation to include the following provisions:
"(10) Provisions eliminating or limiting the personal
liability of a director for monetary damages in an action
brought by or in the right of the corporation for breach of
director's duties to the corporation and its shareholders, as
set forth in Section 309, provided, however, that (A) such a
provision may not eliminate or limit the liability of
directors (i) for acts or omissions that involve intentional
misconduct or a knowing and culpable violation of law, (ii)
for acts of omissions that a director believes to be contrary
to the best interests of the corporation or its shareholders
or that involve the absence of good faith on the part of the
director, (iii) for any transaction from which a director
derived an improper personal benefit, (iv) for acts or
omissions that show a reckless disregard for the director's
duty to the corporation or its shareholders in circumstances
in which the director was aware, or should have been aware, in
the ordinary course of performing a director's duties, of a
risk of serious injury to the corporation or its shareholders,
(v) for acts or omissions that constitute an unexcused pattern
of inattention that amounts to an abdication of the director's
duty to the corporation or its shareholders, (vi) under
Section 310 (which relates to transactions between
corporations and directors of corporations have interrelated
directors) or (vii) under Section 316 (which relates to
liability for illegal distributions or dividends) (B) no such
provision shall eliminate or limit the liability of a director
for any act or omission occurring prior to the date when the
provision becomes effective, and (C) no such provision shall
eliminate or limit the liability of an officer for any act or
omission as an officer, notwithstanding that the officer is
also a director or that his or her actions, if negligent or
improper, have been ratified by the directors.
"(11) A provision authorizing, whether by bylaw,
agreement, or otherwise, the indemnification of agents (as
defined in Section 317) in excess of that expressly permitted
by Section 317 for those agents of the corporation for breach
of duty to the corporation and its stockholders, provided,
however, that the provision may not provide for
indemnification of any agent for any acts or omissions or
transactions from which a director may not be relieved of
liability as set forth in the exception to paragraph (10) or
as to circumstances in which indemnity is expressly prohibited
by Section 317.
6
<PAGE>
Notwithstanding this subdivision, in the case of a
close corporation any of the provisions referred to above may
be validly included in a shareholders' agreement.
Notwithstanding this subdivision, bylaws may require for all
or any actions by the board the affirmative vote of a majority
of the authorized number of directors. Nothing contained in
this subdivision shall affect the enforceability, as between
the parties thereto, of any lawful agreement not otherwise
contrary to public policy."
Section 204.5(a) was added to the California Corporations Code and
provides that if the articles of incorporation include a provision reading
substantially as follows: "The liability of the directors of the corporation for
monetary damages shall be eliminated to the fullest extent permissible under
"California law", then the corporation shall be considered to have adopted a
provision as authorized by paragraph (10) of subdivision (a) of Section 204 and
more specific wording shall not be required.
The Articles of the Company contains the following Article V:
"ARTICLE V - DIRECTOR LIABILITY
The liability of the directors of the Corporation for
monetary damages shall be eliminated to the fullest
extent permissible under California law."
In addition, the Articles of the Company contains the
following Article VI:
"ARTICLE VI - INDEMNIFICATION
The corporation is authorized to provide
indemnification of agents (as defined in Section 317
of the Corporation Code) for breach of duty to the
corporation and its stockholders through bylaw
provisions or through agreements with the agents, or
both, in excess of the indemnification otherwise
permitted by Section 317 of the Corporations Code,
subject to the limits on such excess indemnification
set forth in Section 204 of the Corporations Code."
The Company has adopted provisions in its bylaws and indemnification agreements
pursuant to the above provisions.
7
<PAGE>
Section 317 of the California General Corporation Law is set forth below:
"Section 317. Indemnification of Corporate "Agent".
(a) For the purposes of this section, "agent" means any person who is
or was a director, officer, employee or other agent of the corporation, or is or
was serving at the request of the corporation as a director, officer, employee
or agent of another foreign or domestic corporation, partnership, joint venture,
trust or other enterprise, or was a director, officer, employee or agent of a
foreign or domestic corporation which was a predecessor corporation of the
corporation or of another enterprise at the request of such predecessor
corporation; "proceeding" means any threatened, pending or completed action or
proceeding, whether civil, criminal, administrative or investigative; and
"expenses" includes without limitation attorneys' fees and any expenses of
establishing a right to indemnification under subdivision (d) or paragraph (3)
of subdivision (e).
(b) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any proceeding (other than an
action by or in the right of the corporation to procure a judgment in its favor)
by reason of the fact that such person is or was an agent of the corporation,
against expenses, judgments, fines, settlements and other amounts actually and
reasonably incurred in connection with such proceeding if such person acted in
good faith and in a manner such person reasonably believed to be in the best
interests of the corporation and, in the case of a criminal proceeding, had no
reasonable cause to believe the conduct of such person was unlawful. The
termination of any proceeding by judgment, order, settlement, conviction or upon
a plea of nolo contendere or its equivalent shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which the
person reasonably believed to be in the interests of the corporation or that the
person had reasonable cause to believe that the person's conduct was unlawful.
(c) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action by or in the right of the corporation to procure a judgment in
its favor by reason of the fact that such person is or was an agent of the
corporation, against expenses actually and reasonably incurred by such person in
connection with the defense or settlement of such action if such person acted in
good faith, in a manner such person believed to be in the best interests of the
corporation and its shareholders.
No indemnification shall be made under this subdivision for any of the
following:
(1) In respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable to the corporation in the performance of
such person's duty to the corporation and its shareholders, unless and only to
the extent that the court in which such proceeding is or was pending shall
determine upon application that, in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for the expenses and
then only to the extent that the court shall determine.
8
<PAGE>
(2) Of amounts paid in settling or otherwise disposing of a pending
action without court approval.
(3) Of expenses incurred in defending a pending action which is settled
or otherwise disposed of without court approval.
(d) To the extent that an agent of a corporation has been successful on
the merits in defense of any proceeding referred to in subdivision (b) or (c) or
in defense of any claim, issue or matter therein, the agent shall be indemnified
against expenses actually and reasonably incurred by the agent in connection
therewith.
(e) Except as provided in subdivision (d), any indemnification under
this section shall be made by the corporation only if authorized in the specific
case, upon a determination that indemnification of the agent is proper in the
circumstances because the agent has met the applicable standard of conduct set
forth in subdivision (b) or (c), by any of the following:
(1) A majority vote of a quorum consisting of directors who are
not parties to such proceeding.
(2) If such a quorum of directors is not obtainable, by
independent legal counsel in a written opinion.
(3) Approval of the shareholders (Section 153), with the shares
owned by the person to be indemnified not being entitled to vote thereon.
(4) The court in which such proceeding is or was pending upon
application made by the corporation or the agent or the attorney or other
person rendering services in connection with the defense, whether or not such
application by the agent, attorney or other person is opposed by the
corporation.
(f) Expenses incurred in defending any proceeding may be advanced by
the corporation prior to the final disposition of such proceeding upon receipt
of an undertaking by or on behalf of the agent to repay such amount unless it
shall be determined ultimately that the agent is not entitled to be indemnified
as authorized in this section.
(g) The indemnification provided by this section shall not be deemed
exclusive of any additional rights to indemnification for breach of duty to the
corporation and its shareholders while acting in the capacity of a director or
officer of the corporation to the extent the additional rights to
indemnification are authorized in an article provision adopted pursuant to
paragraph (11) of subdivision (a) of section 204. The indemnification provided
by this section for acts, omissions, or transactions while acting in the
capacity of, or while serving as, a director or officer of the corporation but
not involving breach of duty to the corporation and its shareholders shall not
be deemed exclusive of any other rights to which those seeking indemnification
may be entitled under any bylaw, agreement, vote of
9
<PAGE>
shareholders or disinterested directors, or otherwise, to the extent the
additional rights to indemnification are authorized in the articles of the
corporation. An article provision authorizing indemnification "in excess of that
otherwise permitted by Section 317" or "to the fullest extent permissible under
California law" or the substantial equivalent thereof shall be construed to be
both a provision for additional indemnification for breach of duty to the
corporation and its shareholders as referred to in, and with the limitations
required by, paragraph (11) of subdivision (a) of section 204 and a provision
for additional indemnification as referred to in the second sentence of this
subdivision. The rights to indemnity hereunder shall continue as to a person who
has ceased to be a director, officer, employee, or agent and shall inure to the
benefit of the heirs, executors, and administrators of the person. Nothing
contained in this section shall affect any right to indemnification to which
persons other than such directors and officers may be entitled by contract or
otherwise.
(h) No indemnification or advance shall be made under this section,
except as provided in subdivision (d) or paragraph (3) of subdivision (e), in
any circumstance where it appears:
(1) That it would be inconsistent with a provision of the
articles, bylaws, a resolution of the shareholders or an agreement in effect
at the time of the accrual of the alleged cause of action asserted in the
proceeding in which the expenses were incurred or other amounts were paid,
which prohibits or otherwise limits indemnification.
(2) That it would be inconsistent with any condition expressly
imposed by a court in approving a settlement.
(i) A corporation shall have power to purchase and maintain insurance
on behalf of any agent of the corporation against any liability asserted against
or incurred by the agent in such capacity or arising out of the agent's status
as such whether or not the corporation would have the power to indemnify the
agent against such liability under the provisions of this section. The fact that
a corporation owns all or a portion of the shares of the company issuing a
policy of insurance shall not render this subdivision inapplicable if either of
the following conditions are satisfied: (l) if the articles authorize
indemnification in excess of that authorized in this section and he insurance
provided by this subdivision is limited as indemnification is required to be
limited by paragraph (11) of subdivision (a) of Section 204; or (2)(A) the
company issuing the insurance policy is organized, licensed, and operated in a
manner that complies with the insurance laws and regulations applicable to its
jurisdiction of organization, (B) the company issuing the policy provides
procedures for processing claims that do not permit that company to be subject
to the direct control of the corporation that purchased that policy, and (C) the
policy issued provides for some manner of risk sharing between the issuer and
purchaser of the policy, on one hand, and some unaffiliated person or persons,
on the other, such as by providing for more than one unaffiliated owner of the
company issuing the policy or by providing that a portion of the coverage
furnished will be obtained from some unaffiliated insurer or reinsurer.
10
<PAGE>
(j) This section does not apply to any proceeding against any trustee,
investment manager or other fiduciary of an employee benefit plan in such
person's capacity as such, even though such person may also be an agent as
defined in subdivision (a) of the employer corporation. A corporation shall have
power to indemnify such a trustee, investment manager or other fiduciary to the
extent permitted by subdivision (f) of Section 207."
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers or persons controlling the
registrant pursuant to the foregoing provisions, the registrant has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is
therefore unenforceable.
ITEM 7. Exemption from Registration Claimed.
Inapplicable.
ITEM 8. Exhibits.
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
4 BYL Bancorp 1997 Stock Option
Plan, as amended, and form Stock
Option Agreement
5 Opinion of Knecht & Hansen regarding
legality of shares to be registered
15 Letter regarding unaudited interim financial
information (Not Applicable)
23(a) Consent of Knecht & Hansen (filed as part of
Exhibit 5)
23(b) Consent of independent public accountants
25 Power of Attorney (included in signature page)
</TABLE>
ITEM 9. Undertakings.
(a) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended (the
"1933 Act"), each filing of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the 1934 Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the 1934 Act)
hat is incorporated by reference in the
11
<PAGE>
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(b) Insofar as indemnification for liabilities arising under the 1933
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the 1933 Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer of controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the 1933 Act and will be governed by the final
adjudication of such issue.
(c) The undersigned registrant undertakes to include any material
information with respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such information in
the registration statement.
(d) The undersigned registrant undertakes that, for the purpose of
determining any liability under the 1933 Act, each such post-effective
amendment shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(e) The undersigned registrant undertakes to remove from
registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
12
<PAGE>
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized in the City of Yorba Linda, State of California, on this 15th
day of May, 1998.
BYL BANCORP
By /s/ Robert Ucciferri
--------------------------------------
Robert Ucciferri
President and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Robert Ucciferri and Barry J. Moore,
jointly and severally, each in his own capacity, his true and lawful
attorneys-in-fact and agents, each with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments to this Registration Statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and every act and thing requisite or necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that each of said
attorneys-in-fact and agents, or his substitute or substitutes, may lawfully do
or cause to be done by virtue.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Name Title Date
------ ----- ------
<S> <C> <C>
Principal Executive Officer:
/s/ Robert Ucciferri President and Chief Executive May 15, 1998
- ----------------------------- Officer
Robert Ucciferri
Principal Financial and Accounting Officer:
/s/ Barry J. Moore Senior Executive Vice President May 15, 1998
- ----------------------------- and Chief Financial Officer
Barry J. Moore
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Leonard O. Lindborg Director May 15, 1998
- -----------------------------
Leonard O. Lindborg
/s/ H. Rhoads Martin, Jr. Director, Chairman of the Board May 15, 1998
- -----------------------------
H. Rhoads Martin, Jr.
/s/ John F. Myers Director May 15, 1998
- -----------------------------
John F. Myers
/s/ Brent W. Wahlberg Director May 15, 1998
- -----------------------------
Brent W. Wahlberg
</TABLE>
The Plan. Pursuant to the requirements of the Securities Act of 1933,
the Board of Directors who administer the BYL Bancorp 1997 Stock Option Plan has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Yorba Linda, State of
California, on the 15th day of May, 1998.
BYL BANCORP
1997 STOCK OPTION PLAN
By /s/ Robert Ucciferri
----------------------------
Robert Ucciferri, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Name Title Date
<S> <C> <C>
Principal Executive Officer:
/s/ Robert Ucciferri President and Chief Executive May 15, 1998
- -----------------------------
Robert Ucciferri Officer
Principal Financial and Accounting Officer:
/s/ Barry J. Moore Senior Executive Vice President May 15, 1998
- ----------------------------- and Chief Financial Officer
Barry J. Moore
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Leonard O. Lindborg Director May 15, 1998
- -----------------------------
Leonard O. Lindborg
/s/ H. Rhoads Martin, Jr. Director, Chairman of the Board May 15, 1998
- -----------------------------
H. Rhoads Martin, Jr.
/s/ John F. Myers Director May 15, 1998
- -----------------------------
John F. Myers
/s/ Brent W. Wahlberg Director May 15, 1998
- -----------------------------
Brent W. Wahlberg
</TABLE>
15
<PAGE>
EXHIBIT 4
BYL Bancorp 1997 Stock Option Plan, as amended
<PAGE>
BYL BANCORP
1997 STOCK OPTION PLAN
Adopted April 23, 1997
Amended July 23, 1997
Amended February 18, 1998
1. Purpose
-------
The purpose of the BYL Bancorp 1997 Stock Option Plan (the "Plan") is to
strengthen BYL Bancorp (the "Corporation") and those corporations which are
or hereafter become subsidiary corporations by providing additional means of
attracting and retaining competent managerial personnel and by providing to
participating directors, officers, key employees, consultants and others with
significant and material business relationships added incentives for high
levels of performance and for unusual efforts to increase the earnings of the
Corporation and any Subsidiary corporations; and to allow such individuals
the opportunity to participate in the ownership of the Corporation and
thereby have an interest in the success and increased value of the
Corporation. The Plan seeks to accomplish these purposes and achieve these
results by providing a means whereby such directors, officers, key employees,
consultants and others with significant and material business relationships
may purchase shares of Common Stock of the Corporation pursuant to Stock
Options granted in accordance with this Plan.
1
<PAGE>
Stock Options granted pursuant to this Plan are intended to be Incentive
Stock Options or Non-Qualified Stock Options, as shall be determined and
designated by the Stock Option Committee upon the grant of each Stock Option
hereunder.
2. Definitions
-----------
For the purposes of this Plan, the following terms shall have the
following meanings:
(a) "Common Stock." This term shall mean shares of the Corporation's
no par value common stock, subject to adjustment pursuant to Paragraph 14
(Adjustment Upon Changes in Capitalization) hereunder.
(b) "Corporation." This term shall mean BYL Bancorp, a California
corporation.
(c) "Eligible Participant." This term shall mean: (i) all directors
of the Corporation or any Subsidiary; (ii) all full time officers (whether or
not they are also directors) of the Corporation or any Subsidiary; (iii) all
full time key employees (as such persons may be determined by the Stock
Option Committee from time to time) of the Corporation or any Subsidiary; and
(iv) consultants and others with significant and material business
relationships with the Corporation.
(d) "Employer." This term shall mean the Corporation, as defined
herein, or any other subsidiary of the Corporation, as appropriate, depending
upon which company Optionee is employed.
(e) "Fair Market Value." This term shall mean the fair market value
of the Corporation's Common Stock as determined by any reasonable valuation
method
2
<PAGE>
in accordance with the Commissioner of Corporations Regulation Section
260.140.50, which generally provides that in determining whether the price is
fair, predominant weight will be given to the following: (a) if securities of
the same class are publicly traded on an active market of substantial depth,
the recent market price of such securities; (b) if the securities of the same
class have not been so publicly traded, the price at which securities of
reasonable comparable corporations (if any) in the same industry are being
traded, subject to appropriate adjustments for the dissimilarities between
the corporations being compared; or (c) in the absence of any reliable
indicator under subsection (a) or (b), the earnings history, book value and
prospects of the issuer in light of market conditions generally.
(f) "Incentive Stock Option." This term shall mean a Stock Option
which is an "Incentive Stock Option" within the meaning of Section 422A of
the Internal Revenue Code of 1986, as amended.
(g) "Non-Qualified Stock Option." This term shall mean a Stock
Option which is not an Incentive Stock Option.
(h) "Option Shares." This term shall mean shares of Common Stock
which are covered by and subject to any outstanding unexercised Stock Option
granted pursuant to this Plan.
(i) "Optionee." This term shall mean any Eligible Participant to
whom a stock option has been granted pursuant to this Plan, provided that at
least part of the Stock Option is outstanding and unexercised.
3
<PAGE>
(j) "Plan." This term shall mean the BYL Bancorp 1997 Stock Option
Plan as embodied herein and as may be amended from time to time in accordance
with the terms hereof and applicable law.
(k) "Stock Option." This term shall mean the right to purchase from
the Corporation a specified number of shares of Common Stock under the Plan
at a price and upon terms and conditions determined by the Stock Option
Committee.
(l) "Stock Option Committee." The Board of Directors of the
Corporation may select and designate a stock option committee consisting of
at least three and not more than five persons, at least two of whom are
directors, having full authority to act in the matters. Regardless of whether
a Stock Option Committee is selected, the Board of Directors may act as the
Stock Option Committee and any action taken by the Board of Directors as such
shall be deemed to be action taken by the Stock Option Committee. All
references in the Plan to the "Stock Option Committee" shall be deemed
references to the Board of Directors acting as a stock option committee and
to a duly appointed Stock Option Committee, if there be one. In the event of
any conflict between any action taken by the Board of Directors acting as a
Stock Option Committee and any action taken by a duly appointed Stock Option
Committee, the action taken by the Board of Directors shall be controlling
and the action taken by the duly appointed Stock Option Committee shall be
disregarded.
(m) "Subsidiary." This term shall mean any subsidiary corporation of
the Corporation as such term is defined in Section 425(f) of the Internal
Revenue Code of 1986, as amended.
4
<PAGE>
3. Administration
(a) Stock Option Committee. This Plan shall be administered by the
Stock Option Committee. The Board of Directors of the Corporation shall have
the right, in its sole and absolute discretion, to remove or replace any
person from or on the Stock Option Committee at any time for any reason
whatsoever.
(b) Administration of the Plan. Any action of the Stock Option
Committee with respect to the administration of the Plan shall be taken
pursuant to a majority vote, or pursuant to the unanimous written consent, of
its members. Any such action taken by the Stock Option Committee in the
administration of this Plan shall be valid and binding, so long as the same
is in conformity with the terms and conditions of this Plan. Subject to
compliance with each of the terms, conditions and restrictions set forth in
this Plan, including, but not limited to, those set forth in Section 6(a)(ii)
hereof, the Stock Option Committee shall have the exclusive right, in its
sole and absolute discretion, to establish the terms and conditions of any
Stock Options granted under the Plan, including, without limitation, the
power to: (i) establish the number of Stock Options, if any, to be granted
hereunder, in the aggregate and with regard to any individual Eligible
Participant; (ii) determine the time or times when such Stock Options, or any
parts thereof, may be exercised; (iii) determine and designate which Stock
Options granted under the Plan shall be Incentive Stock Options and which
shall be Non-Qualified Stock Options; (iv) determine the Eligible
Participants, if any, to whom Stock Options are granted; (v) determine the
duration and purposes, if any, of leaves of absence which may be
5
<PAGE>
permitted to holders of unexercised, unexpired Stock Options without such
constituting a termination of employment under the Plan; (vi) prescribe and
amend the terms, provisions and form of any instrument or agreement setting
forth the terms and conditions of every Stock Option granted hereunder; and
(vii) make loans to or guarantee any obligations of any Optionees, except
directors, in connection with the exercise of Stock Options as specified in
Section 8(d) hereof, whenever the Stock Option Committee determines that such
loan or guarantee may reasonably be expected to benefit the corporation,
subject to the provisions of Section 315(b) of the California General
Corporations Law of 1977, as amended and subject to Regulations G, U and T
promulgated by the Board of Governors of the Federal Reserve System pursuant
to Section 7 of the Securities Exchange Act of 1934, if the Option Shares are
listed on a stock exchange or are contained in the list of over-the-counter
margin securities published by the Federal Reserve Board.
(c) Decisions and Determinations. Subject to the express provisions
of the Plan, the Stock Option Committee shall have the authority to construe
and interpret the Plan, to define the terms used therein, to prescribe,
amend, and rescind rules and regulations relating to the administration of
the Plan, and to make all other determinations necessary or advisable for
administration of the Plan. Determinations of the Stock Option Committee on
matters referred to in this Section 3 shall be final and conclusive so long
as the same are in conformity with the terms of this Plan.
6
<PAGE>
4. Shares Subject to the Plan
--------------------------
Subject to adjustments as provided in Section 14 hereof, the maximum
number of shares of Common Stock which may be issued upon exercise of Stock
Options granted under this Plan is limited to 30% of the issued and
outstanding shares of the Corporation up to a maximum of 460,519 shares in
the aggregate. If any Stock Option shall be canceled, surrendered, or expire
for any reason without having been exercised in full, the unpurchased Option
Shares represented thereby shall again be available for grants of Stock
Options under this Plan.
5. Eligibility
-----------
Only Eligible Participants shall be eligible to receive grants of Stock
Options under this Plan.
6. Grants of Stock Options
-----------------------
(a) Grant. Subject to the express provisions and limitations of the
Plan, the Stock Option Committee, in its sole and absolute discretion, may
grant Stock Options to Eligible Participants of the Corporation, for a number
of Option Shares, at the price(s) and time(s), on the terms and conditions
and to such Eligible Participants as it deems advisable and specifies in the
respective grants.
Subject to the limitations and restrictions set forth in the Plan,
an Eligible Participant who has been granted a Stock Option may, if otherwise
eligible, be granted additional Stock Options if the Stock Option Committee
shall so determine. The Stock Option Committee shall designate in each grant
of a Stock Option whether the Stock Option is an Incentive Stock Option or a
Non-Qualified Stock Option.
7
<PAGE>
An eligible director, officer or employee shall not
participate in the granting of his or her own options.
(b) Date of Grant and Rights of Optionee. The determination of the
Stock Option Committee to grant a Stock Option shall not in any way
constitute or be deemed to constitute an obligation of the Corporation, or a
right of the Eligible Participant who is the proposed subject of the grant,
and shall not constitute or be deemed to constitute the grant of a Stock
Option hereunder unless and until both the Corporation and the Eligible
Participant have executed and delivered the form of stock option agreement
then required by the Stock Option Committee as evidencing the grant of the
Stock Option, together with such other instruments as may be required by the
Stock Option Committee pursuant to this Plan; provided, however, that the
Stock Option Committee may fix the date of grant as any date on or after the
date of its final determination to grant the Stock Option (or if no such date
is fixed, then the date of grant shall be the date on which the determination
was finally made by the Stock Option Committee to grant the Stock Option),
and such date shall be set forth in the stock option agreement. The date of
grant as so determined shall be deemed the date of grant of the Stock Option
for purposes of this Plan.
(c) Shareholder-Employees. Notwithstanding anything to the contrary
contained elsewhere herein, a Stock Option shall not be granted hereunder to
an Eligible Participant who owns, directly or indirectly, at the date of the
grant of the Stock Option, more than ten percent (10%) of the total combined
voting power of all classes of capital stock of the Corporation or a
Subsidiary corporation, unless the
8
<PAGE>
purchase price of the Option Shares subject to said Stock Option is at least
110% of the Fair Market Value of the Option Shares, determined as of the date
said Stock Option is granted.
(d) Maximum Value of Stock Options. Except as provided in paragraph
(e) of this Section 6, the maximum aggregate Fair Market Value of Option
Shares (determined as of the respective Stock Option grant dates) for which
an Eligible Participant may be granted Incentive Stock Options in any
calendar year shall not exceed $100,000, plus any "unused carryover amount."
The unused carryover amount, determined on a yearly basis, shall be equal to
one-half (1/2) of the difference between $100,000 and the aggregate Fair
Market Value (determined as of the respective Stock Option grant dates) of
all of the Option Shares subject to Incentive Stock Options granted to the
Optionee during the calendar year under the Plan. The provisions of Section
422A(c)(4) of the Internal Revenue Code of 1986, as amended, are incorporated
herein by this reference for the purpose of the determination and application
of the unused carryover amount.
The aggregate fair market value (determined at the time the option
is granted) of the stock with respect to which incentive stock options are
exercisable for the first time by such individual under the terms of the Plan
during any calendar year is limited to $100,000, but the value of stock for
which options may be granted to an employee in a given year may exceed
$100,000, but such options in excess of $100,000 shall be treated as
non-qualified options.
9
<PAGE>
(e) Substituted Stock Options. If all of the outstanding shares of
common stock of another corporation are changed into or exchanged solely for
common stock in a transaction to which Section 425(a) of the internal Revenue
Code of 1986, as amended, applies, then, subject to the approval of the Board
of Directors of the Bank, Stock Options under the Plan may be substituted
("Substituted Options") in exchange for valid, unexercised and unexpired
stock options of such other corporation. Substituted options shall qualify as
Incentive Stock Options under the Plan, provided that (and to the extent) the
stock options exchanged for the Substituted Options were "Incentive Stock
Options" within the meaning of Section 422A of the Internal Revenue Code of
1986, as amended.
(f) Non-Qualified Stock Options. All Stock Options granted by the
Stock Option Committee which: (i) are designated at the time of grant as
Incentive Stock Options but do not so qualify under the provisions of Section
422A of the Code or any regulations or rulings issued by the Internal Revenue
Service for any reason; (ii) are in excess of the fair market value
limitations set forth in Section 6(d); or (iii) are designated at the time of
grant as Non-Qualified Stock Options, shall be deemed Non-Qualified Stock
Options under this Plan. Non-Qualified Stock Options granted or substituted
hereunder shall be so designated in the stock option agreement entered into
between the Corporation and the Optionee.
7. Stock Option Exercise Price
---------------------------
(a) Minimum Price. The exercise price of any Option Shares
shall be determined by the Stock Option Committee, in its sole and absolute
discretion, upon
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<PAGE>
the grant of a Stock Option. Except as provided elsewhere herein, said
exercise price shall not be less than one hundred percent (100%) of the Fair
Market Value of the Common Stock represented by the Option Share on the date
of grant of the related Stock Option.
(b) Exchanged Stock Options. Where the outstanding shares of stock
of another corporation are changed into or exchanged for shares of Common
Stock of the Corporation without monetary consideration to that other
corporation, then, subject to the approval of the Board or Directors of the
Corporation, Stock Options may be granted in exchange for unexercised,
unexpired stock options of the other corporation, and the exercise price of
the Option Shares subject to each Stock Option so granted may be fixed at a
price less than one hundred percent (100%) of the Fair Market Value of the
Common Stock at the time such Stock Option is granted if said exercise price
has been computed to be not less than the exercise price set forth in the
stock option of the other corporation, with appropriate adjustment to reflect
the exchange ratio of the shares of stock of the other corporation into the
shares of Common Stock of the Corporation.
(c) Substituted Options. The exercise price of the Option Shares
subject to each Substituted Option may be fixed at a price less than one
hundred percent (100%) of the Fair Market Value of the Common Stock at the
time such Substituted option is granted if said exercise price has been
computed to be not less than the exercise price set forth in the stock option
of the other corporation for which it was
11
<PAGE>
exchanged, with appropriate adjustment to reflect the exchange ratio of the
shares of stock of the other corporation into the shares of Common Stock. 8.
Exercise of Stock Options.
8. Exercise of Stock Options.
--------------------------
(a) Exercise. Except as otherwise provided elsewhere herein, each
Stock Option shall be exercisable in such increments, which need not be
equal, and upon such contingencies as the Stock Option Committee shall
determine at the time of grant of the Stock Option; provided, however, (i)
that if an Optionee shall not in any given period exercise any part of a
Stock Option which has become exercisable during that period, the Optionee's
right to exercise such part of the Stock Option shall continue until
expiration of the Stock Option or any part thereof as may be provided in the
related Stock Option Agreement, and (ii) in the case of options that are not
granted to officers, directors, consultants of, or others with significant
and material business relationships with, the Company, a minimum of 20% of
the stock options shall be exercisable in each year over a five year period
from the date the option is granted. No Stock Option or part thereof shall be
exercisable except with respect to whole shares of Common Stock, and
fractional share interests shall be disregarded except that they may be
accumulated.
(b) Prior Outstanding Incentive Stock Options. Incentive Stock
Options granted to an Optionee may be exercisable while such Optionee has
outstanding and unexercised any Incentive Stock Option previously granted (or
substituted) to him or her pursuant to this Plan. The Stock Option Committee
shall determine if such options shall be exercisable if there are any
Incentive Stock Options previously
12
<PAGE>
granted (or substituted) to him or her pursuant to this Plan, and such
determination shall be evidenced in the Agreement executed by the Optionee
and Company, subject to the requirements of Rule 260.141.41(f) of the
California Commissioner of Corporations. An Incentive Stock Option shall be
treated as outstanding until it is exercised in full or expires by reason of
lapse of time.
(c) Notice and Payment. Stock Options granted hereunder shall be
exercised by written notice delivered to the Corporation specifying the
number of Option Shares with respect to which the Stock Option is being
exercised, together with concurrent payment in full of the exercise price as
hereinafter provided in Section 8(d) hereof. If the Stock Option is being
exercised by any person or persons other than the Optionee, said notice shall
be accompanied by proof, satisfactory to counsel for the Corporation, of the
right to such person or persons to exercise the Stock Option. The
Corporation's receipt of a notice of exercise without concurrent receipt of
the full amount of the exercise price shall not be deemed an exercise of a
Stock Option by an Optionee, and the Corporation shall have no obligation to
an Optionee for any Option Shares unless and until full payment of the
exercise price is received by the Corporation in accordance with Section 8(d)
hereof, and all of the terms and provisions of the Plan and the related stock
option agreement have been complied with.
(d) Payment of Exercise Price. The exercise price of any Option
Shares purchased upon the proper exercise of a Stock Option shall be paid in
full at the time of each exercise of a Stock Option in cash and/or, with the
prior written approval of
13
<PAGE>
the Stock Option Committee, in Common Stock of the Corporation which, when
added to the cash payment, if any, has an aggregate Fair Market Value equal
to the full amount of the exercise price of the Stock Option, or part
thereof, then being exercised and/or, with the prior written approval of the
Stock Option Committee and if legally permitted, on a deferred basis
evidenced by a promissory note, containing such terms and subject to such
security as the Stock Option Committee shall determine to be fair and
reasonable from time to time, for the total option price for the number of
shares so purchased. No Director may purchase any Stock Option on a deferred
basis evidenced by a promissory note. Unless payment is on a deferred basis,
payment by an Optionee as provided herein shall be made in full concurrently
with the Optionee's notification to the Corporation of his intention to
exercise all or part of a Stock Option. If all or part of payment is made in
shares of Common Stock as heretofore provided, such payment shall be deemed
to have been made only upon receipt by the Corporation of all required share
certificates, and all stock powers and other required transfer documents
necessary to transfer the shares of Common Stock to the Corporation.
(e) Reorganization. Notwithstanding any provision in any stock
option agreement pertaining to the time of exercise of a Stock Option, or
part thereof, upon adoption by the requisite holders of the Corporation's
outstanding shares of Common Stock of any plan of dissolution, liquidation,
reorganization, merger, consolidation or sale of all or substantially all of
the assets of the Corporation to another corporation, or the acquisition of
stock representing more than 50% of the voting power of the
14
<PAGE>
Corporation then outstanding, by another corporation or person, which would,
upon consummation, result in termination of a Stock Option in accordance with
Section 16 hereof, the Stock Option shall become immediately exercisable as
to all Option Shares, whether or not vested, for such period of time as may
be determined by the Stock Option Committee, but in any event not less than
30 days prior to the adoption of the plan of dissolution, liquidation,
reorganization, merger, consolidation, sale, or acquisition on the condition
that the terminating event described in Section 16 hereof is consummated. Any
Option Shares not exercised will be terminated. If such Terminating Event is
not consummated, Stock Options granted pursuant to the Plan shall be
exercisable in accordance with their respective terms.
(f) Minimum Exercise. Not less than ten (10) Option Shares may be
purchased at any one time upon exercise of a Stock Option unless the number
of shares purchased is the total number which remains to be purchased under
the Stock Option.
(g) Compliance With Law. No shares of Common Stock shall be issued
by the Corporation upon exercise of any Stock Option, and an Optionee shall
have no rights or claim to such shares, unless and until: (a) payment in full
as provided in Section 8(d) hereof has been received by the Corporation; (b)
in the opinion of the counsel for the Corporation, all applicable
registration requirements of the Securities Act of 1933, all applicable
listing requirements of securities exchanges or associations on which the
Corporation's Common Stock is then listed or traded, and all other
requirements of law and of regulatory bodies having jurisdiction over such
issuance
15
<PAGE>
and delivery, have been fully complied with; and (c) if required by federal
or state law or regulation, the Optionee shall have paid to the Corporation
the amount, if any, required to be withheld on the amount deemed to be
compensation to the Optionee as a result of the exercise of his or her Stock
Option, or made other arrangements satisfactory to the Corporation, in its
sole discretion, to satisfy applicable income tax withholding requirements.
9. Nontransferability of Stock Options.
------------------------------------
Each Stock Option shall, by its terms, be nontransferable by
the Optionee other than by will or the laws of descent and distribution, and
shall be exercisable during the Optionee's lifetime only by the Optionee or his
or her guardian or legal representative.
10. Continuation of Employment
--------------------------
Except for Optionees with a written contract for any definite term, this
Agreement shall not obligate the Corporation or a Subsidiary to employ
Optionee.
11. Cessation of Employment
-----------------------
Except as provided in Sections 8(e), 12, 13, 14, 15 or 16 hereof, if,
for any reason, an Optionee's status as an Eligible Participant is
terminated, the Stock Options granted to such Optionee shall expire on the
expiration dates specified for said Stock Options at the time of their
initial grant, or three (3) months after the Optionee's status as an Eligible
Participant is terminated, whichever is earlier. Thereafter, Options shall be
exercisable only as to those increments, if any, which had become exercisable
as of such expiration date, and any Stock Options or
16
<PAGE>
increments which had not become exercisable as of such date shall expire and
terminate automatically on such expiration date.
12. Termination for Violation of Standards of Conduct as Referenced in
Optionee's Employee Handbook
------------------------------------------------------------------
If Optionee's status as an Eligible Participant is terminated for
violation of the Employer's Standards of Conduct, the vested portion of Stock
Options granted to such Optionee shall be exercisable for a thirty (30) day
period following such termination, and thereafter such Stock Options shall
automatically expire and terminate in their entirety; provided, however, that
the Stock Option Committee may, in its sole discretion, within thirty (30)
days of such termination, reinstate such Stock Options to the status of
options terminated for reasons other than violations of the Employer's
Standards of Conduct, death or disability by giving written notice of such
reinstatement to the Optionee. In the event of such reinstatement, the
Optionee may exercise the Stock Options as provided in Section 11 herein.
Reasons for termination for violation of the Employer's Standards of Conduct
shall include, but not be limited to, termination for malfeasance or gross
misfeasance in the performance of duties or conviction of illegal activity in
connection therewith, and, in any event, the determination of the Stock
Option Committee with respect thereto shall be final and conclusive.
13. Death of Optionee
If an Optionee loses his status as an Eligible Participant by reason of
death, or if an Optionee dies during the three-month period referred to in
Section 12 hereof, the
17
<PAGE>
Stock Options granted to such Optionee shall expire on the expiration dates
specified for said Stock Options at the time of their initial grant, or one
(l) year after the date of such death, whichever is earlier. After such death
but before such expiration, subject to the terms and provisions of the Plan
and the related stock option agreements, the person or persons to whom such
Optionee's rights under the Stock Options shall have passed by will or by the
applicable laws of descent and distribution, or the executor or administrator
of the Optionee's estate, shall have the right to exercise such Stock Options
to the extent that increments, if any, had become exercisable as of the date
on which the Optionee's status as an Eligible Participant had been lost.
14. Disability of Optionee
----------------------
If an Optionee is disabled while employed by or while serving as a
director of the Corporation or a Subsidiary or during the three-month period
referred to in Section 12 hereof, the Stock Options granted to such Optionee
shall expire on the expiration dates specified for said Stock Options at the
time of their initial grant, or one (l) year after the date of such
disability, whichever is earlier. After such disability but before such
expiration, the Optionee or a guardian or conservator of the Optionee's
estate, as duly appointed by a court of competent jurisdiction, shall have
the right to exercise such Stock Options to the extent that increments, if
any, had become exercisable as of the date on which the Optionee became
disabled or ceased to be employed by the Corporation or a Subsidiary as a
result of the disability. For the purpose of this Section 14, an Optionee
shall be deemed to have become "disabled" if it shall appear
18
<PAGE>
to the Stock Option Committee, upon written certification delivered to the
Corporation by a qualified licensed physician, that the Optionee has become
permanently and totally unable to engage in any substantial gainful activity
by reason of any medically determinable physical or mental impairment which
can be expected to result in death, or which has lasted or can be expected to
last for a continuous period of not less than 12 months.
15. Adjustment Upon Changes in Capitalization
If the outstanding shares of Common Stock of the Corporation are
increased, decreased, or changed into or exchanged for a different number or
kind of shares or securities of the Corporation, through a reorganization,
merger, recapitalization, reclassification, stock split, stock dividend,
stock consolidation, or otherwise, without consideration to the Corporation,
an appropriate and proportionate adjustment shall be made in the number and
kind of shares as to which Stock Options may be granted. A corresponding
adjustment changing the number or kind of Option Shares and the exercise
prices per share allocated to unexercised Stock Options, or portions thereof,
which shall have been granted prior to any such change, shall likewise be
made. Any such adjustment, however, in an outstanding Stock Option shall be
made without change in the total price applicable to the unexercised portion
of the Stock Option, but with a corresponding adjustment in the price for
each Option Share subject to the Stock Option. Any adjustment under this
Section shall be made by the Stock Option Committee, whose determination as
to what adjustments shall be made, and the extent thereof, shall be final and
conclusive. No fractional shares of stock shall be
19
<PAGE>
issued or made available under the Plan on account of any such adjustment,
and fractional share interests shall be disregarded and the fractional share
interest shall be rounded down to the nearest whole number.
16. Terminating Events
Not less than thirty (30) days prior to consummation of a plan of
dissolution or liquidation of the Corporation, or consummation of a plan of
reorganization, merger or consolidation of the Corporation with one or more
corporations, as a result of which the Corporation is not the surviving
corporation and the outstanding securities of the class then subject to
options hereunder are changed or exchanged for cash or property or securities
not of the Corporation's issue, or upon the sale of all or substantially all
the assets of the Corporation to another corporation, or the acquisition of
stock representing more than fifty percent (50%) of the voting power of the
Corporation then outstanding by another corporation or person (the
"Terminating Event"), the Stock Option Committee or the Board of Directors
shall notify each Optionee of the pendency of the Terminating Event. Upon the
effective date of the Terminating Event, the Plan shall automatically
terminate and all Stock Options theretofore granted shall terminate, unless
provision is made in connection with such transaction for the continuance of
the Plan and/or assumption of Stock Options theretofore granted, or
substitution for such Stock Options with new stock options covering stock of
a successor employer corporation, or a parent or subsidiary corporation
thereof, solely at the discretion of such successor corporation, or parent or
subsidiary corporation, with appropriate adjustments as to number and kind of
20
<PAGE>
shares and prices, in which event the Plan and options theretofore granted
shall continue in the manner and under the terms so provided. If the Plan and
unexercised options shall terminate pursuant to the foregoing sentence, all
persons shall have the right to exercise any unexercised portions of options
outstanding and not exercised, shall have the right, at such time prior to
the consummation of the transaction causing such termination as the
Corporation shall designate and for a period of not less than 30 days, to
exercise all unexercised portions of their options, including the portions
which would, but for this paragraph entitled "Terminating Events," not yet be
exercisable.
17. Amendment and Termination
The Board of Directors of the Corporation may at any time and from
time-to-time suspend, amend, or terminate the Plan and may, with the consent
of Optionee, make such modifications of the terms and conditions of a Stock
Option as it shall deem advisable; provided that, except as permitted under
the provisions of Section 16 hereof, no amendment or modification may be
adopted without the Corporation having first obtained all necessary
regulatory approvals and approval of the holders of a majority of the
Corporation's shares of Common Stock present, or represented, and entitled to
vote at a duly held meeting of shareholders of the Corporation if the
amendment or modification would:
(a) materially increase the benefits accruing to participants under
the Plan;
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<PAGE>
(b) materially increase the number of securities which may be issued
under the Plan;
(c) materially modify the requirements as to eligibility for
participation in the Plan;
(d) increase or decrease the exercise price of any Stock Options
granted under the Plan;
(e) increase the maximum term of Stock Options provided for herein;
(f) permit Stock Options to be granted to any person who is not an
Eligible Participant; or
(g) change any provision of the Plan which would affect the
qualification as an Incentive Stock Option under the Plan.
No Stock Option may be granted during any suspension of the Plan or after
termination of the Plan. Amendment, suspension, or termination of the Plan
shall not (except as otherwise provided in Section 17 hereof), without the
consent of the Optionee, alter or impair any rights or obligations under any
Stock Option theretofore granted.
18. Rights of Eligible Participants and Optionees
Neither any Eligible Participant, any Optionee or any other person shall
have any claim or right to be granted any Stock Option under this Plan, and
neither this Plan nor any action taken hereunder shall be deemed or construed
as giving any Eligible Participant, Optionee or any other person any right to
be retained in the employ of the Corporation or any subsidiary of the
Corporation. Without limiting the
22
<PAGE>
generality of the foregoing, there is no vesting of any right in the
classification of any person as an Eligible Participant or Optionee, such
classification being used solely to define and limit those persons who are
eligible for consideration of the grant of Stock Options under the Plan.
19. Privileges of Stock Ownership; Securities Law Compliance; Notice of Sale
------------------------------------------------------------------------
No Optionee shall be entitled to the privileges of stock ownership as to
any Option Shares not actually issued and delivered. No Option Shares may be
purchased upon the exercise of a Stock Option unless and until all then
applicable requirements of all regulatory agencies having jurisdiction and
all applicable requirements of securities exchanges upon which the stock of
the Corporation is listed (if any) shall have been fully complied with. The
Corporation will diligently endeavor to comply with all applicable securities
laws before any options are granted under the Plan and before any stock is
issued pursuant to options. The Optionee shall, not more than five (5) days
after each sale or other disposition of shares of Common Stock acquired
pursuant to the exercise of Stock Options, give the Corporation notice in
writing of such sale or other disposition.
The Corporation will provide to each Optionee its Annual Report as
required by Section 260.140.46 of the regulations of the California
Commissioner of Corporations.
20. Effective Date of the Plan
--------------------------
The Plan shall be deemed adopted as of April 23, 1997, and shall be
effective immediately, subject to approval of the Plan by the holders of at
least a majority of
23
<PAGE>
the Corporation's outstanding shares of Common Stock and approval of the Plan
by the California Commissioner of Corporations.
21. Termination
-----------
Unless previously terminated as aforesaid, the Plan shall terminate ten
(10) years from the earliest date of (i) adoption of the Plan by the Board of
Directors, or (ii) approval of the Plan by holders of at least a majority of
the Corporation's outstanding shares of Common Stock. No Stock Options shall
be granted under the Plan thereafter, but such termination shall not affect
any Stock Option theretofore granted.
22. Option Agreement
----------------
Each Stock Option granted under the Plan shall be evidenced by a written
stock option agreement executed by the Corporation and the Optionee, and
shall contain each of the provisions and agreements herein specifically
required to be contained therein, and such other terms and conditions as are
deemed desirable by the Stock Option Committee and are not inconsistent with
the Plan.
23. Stock Option Period
-------------------
Each Stock Option and all rights and obligations thereunder shall expire
on such date as the Stock Option Committee may determine, but not later than ten
(10) years from the date such Stock Option is granted, and shall be subject to
earlier termination as provided elsewhere in the Plan.
24
<PAGE>
24. Exculpation and Indemnification of Stock Option Committee
---------------------------------------------------------
In addition to such other rights of indemnification which they may have
as directors of the Corporation or as members of the Stock Option Committee,
the present and former members of the Stock Option Committee, and each of
them, shall be indemnified by the Corporation for and against all costs,
judgments, penalties and reasonable expenses, including reasonable attorney's
fees, actually and necessarily incurred by them in connection with any
action, suit or proceeding, or in connection with any appeal thereof, to
which they or any of them may be a party by reason of any act or omission of
any member of the Stock Option Committee under or in connection with the Plan
or any Stock Option granted thereunder; provided, however, that a member of
the Stock Option Committee shall not be entitled to any indemnification
whatsoever pursuant to this Section for or as a result of any act or omission
of such member which was not taken in good faith and which constituted
willful misconduct or gross negligence by such member; provided further, that
any amounts paid by any member of the Stock Option Committee in settlement of
any action, suit or proceeding for which indemnification may be sought
pursuant to this Section shall be first approved in writing by independent
legal counsel selected by the Corporation; and, provided further, that within
thirty (30) days after institution of any action, suit or proceeding against
any member with respect to which such member is entitled to indemnification
hereunder, such member shall, in writing, offer the Corporation the
opportunity, at its own expense, to handle (including settle) and
25
<PAGE>
conduct the defense thereof. The provisions of this Section shall apply to
the estate, executor and administrator of each member of the Stock Option
Committee.
25. Agreement and Representations of Optionee
-----------------------------------------
Unless the shares of Common Stock covered by this Plan have been
registered with the Securities and Exchange Commission pursuant to Section 5
of the Securities Act of 1933, each Optionee shall by and upon accepting a
Stock Option, represent and agree in writing, for himself or herself and his
or her transferees by will or the laws of descent and distribution, that he
or she is a bona fide California resident, that all such Option Shares will
be acquired for investment purposes and not for resale or distribution and
that the optioned stock will not be transferred to a person who is not a
California resident for the nine month period specified in SEC Rule 147. Upon
the exercise of a Stock Option, or a part thereof, the person entitled to
exercise the same shall, unless waived by the Corporation, furnish evidence
satisfactory to the Corporation, including written and signed
representations, to the effect that he or she is a California resident, that
the Option Shares are being acquired for investment purposes and not for
resale or distribution, and that the Option Shares being acquired shall not
be sold or otherwise transferred to any individual or entity not a resident
of the State of California for the nine month period specified in SEC Rule
147. Furthermore, the Corporation, at its sole discretion, to assure itself
that any sale or distribution by the Optionee complies with this Plan and any
applicable federal or state securities laws, may take all reasonable steps,
including placing stop transfer instructions with the corporation's transfer
agent prohibiting transfers in violation of
26
<PAGE>
the Plan and affixing the following legend (and/or such other legend or
legends as the Stock Option Committee shall require) on certificates
evidencing the shares:
"IT IS UNLAWFUL TO CONSUMMATE A SALE OR
TRANSFER OF THIS SECURITY, OR ANY INTEREST
THEREIN, OR TO RECEIVE ANY CONSIDERATION
THEREFOR, WITHOUT THE PRIOR WRITTEN CONSENT OF
THE COMMISSIONER OF CORPORATIONS OF THE STATE OF
CALIFORNIA, EXCEPT AS PERMITTED IN THE
COMMISSIONER'S RULES."
and
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED
OR OTHERWISE TRANSFERRED OR OFFERED FOR SALE IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT WITH
RESPECT TO THEM UNDER THE ACT OR A DETERMINATION BY
BYL Bancorp THAT REGISTRATION IS NOT REQUIRED."
At any time that an Optionee contemplated the disposition of any of the
Option Shares (whether by sale, exchange, gift or other form of transfer) he
or she shall first notify the Corporation of such proposed disposition and
shall thereafter cooperate with the Corporation in complying with all
applicable requirements of law which, in the opinion of counsel for the
Corporation, must be satisfied prior to the making of such disposition.
Before consummating such disposition, BYL Bancorp shall determine that such
disposition will not result in a violation of any state or federal securities
law or regulations. The Corporation shall remove any legend affixed to
certificates for Option Shares pursuant to this Section if and when all of
the
27
<PAGE>
restrictions on the transfer of the Option Shares, whether imposed by this
Plan or federal or state law, have terminated. An Optionee who thereafter
sells or disposes of his shares of Common Stock will be required to notify
the Corporation of such sale or disposition within five (5) days after the
sale or disposition.
26. Notices
-------
All notices and demands of any kind which the Stock Option Committee, any
Optionee, Eligible Participant, or any other person may be required or
desires to serve under the terms of this Plan shall be in writing and shall
be served by personal service upon the respective person or by leaving a copy
of such notice or demand at the address of such person as may be reflected in
the records of the Corporation, or in the case of the Stock Option Committee,
with the Secretary of the Corporation, or by mailing a copy thereof by
certified or registered mail, postage prepaid, with return receipt requested.
In the case of service by mail, it shall be deemed complete at the expiration
of the third day after the day of mailing, except for notice of the exercise
of any Stock Option and payment of the Stock Option exercise price, both of
which must be actually received by the Corporation.
27. (Reserved)
28. Limitation of Rights
--------------------
The Stock Option Committee, in its sole and absolute discretion, is
entitled to determine who, if anyone, is an Eligible Participant under this
Plan, and which, if any, Eligible Participant shall receive any grant of a
Stock Option. No oral or written agreement by any person on behalf of the
Corporation relating to this Plan or any
28
<PAGE>
Stock Option granted hereunder is authorized, and such agreement may not bind
the Corporation or the Stock Option Committee to grant any Stock Option to
any person.
29. Severability
------------
If any provision of this Plan as applied to any person or to any
circumstances shall be adjudged by a court of competent jurisdiction to be
void, invalid, or unenforceable, the same shall in no way effect any other
provision hereof, the application of any such provision in any other
circumstances, or the validity of enforceability hereof.
30. Construction
-----------
Where the context or construction requires, all words applied in the
plural shall be deemed to have been used in the singular and vice versa, and
the masculine gender shall include the feminine and the neuter.
31. Headings
--------
The headings of the several paragraphs of this Plan are inserted solely
for convenience of reference and are not intended to form a part of and are
not intended to govern, limit or aid in the construction of any term or
provision hereof.
32. Successors
----------
This Plan shall be binding upon the respective successors, assigns,
heirs, executors, administrators, guardians and personal representatives of
the Corporation and any Optionee.
29
<PAGE>
33. Governing Law
-------------
This Plan shall be governed by and construed in accordance with the laws
of the State of California.
34. Conflict
--------
In the event of any conflict between the terms and provisions of this
Plan, and any other document, agreement or instrument, including, without
limitation, any stock option agreement, the terms and provisions of this Plan
shall control.
30
<PAGE>
SECRETARY'S CERTIFICATE OF ADOPTION
-----------------------------------
I, the undersigned, do hereby certify:
1. That I am the duly elected and acting Assistant Secretary of BYL
Bancorp; and
2. That the foregoing BYL Bancorp 1997 Stock Option Plan, as
amended, was duly adopted by the Board of Directors of BYL Bancorp as the
Stock Option Plan for the Corporation at a meeting duly called as required by
law and convened on the 18th day of February, 1998.
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed
the seal of the Corporation this 18th day of February, 1998.
/s/ Barry J. Moore
-------------------------------------
Barry J. Moore, Assistant, Secretary
[SEAL]
31
<PAGE>
<PAGE>
OPTIONEES TO WHOM INCENTIVE STOCK OPTIONS ARE GRANTED MUST MEET CERTAIN HOLDING
PERIOD AND EMPLOYMENT REQUIREMENTS FOR FAVORABLE TAX TREATMENT.
UNLESS OTHERWISE STATED, ALL DEFINED TERMS IN THE PLAN SHALL HAVE THE SAME
MEANING HEREIN AS SET FORTH IN THE PLAN.
IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY, OR ANY
INTEREST THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFOR, WITHOUT THE PRIOR
WRITTEN CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA,
EXCEPT AS PERMITTED IN THE COMMISSIONER'S RULES.
BYL BANCORP
STOCK OPTION AGREEMENT
/ / Incentive Stock Option
/ / Non-Qualified Stock Option
THIS AGREEMENT, dated the ____ day of ____________, 19__, by
and between BYL Bancorp, a California corporation (the "Corporation"), and
_____________________ (the "Optionee");
WHEREAS, pursuant to the Corporation's 1997 Stock Option Plan
(the "Plan"), the Stock Option Committee has authorized the grant to Optionee of
a Stock Option to purchase all or any part of _____________________ (______)
authorized but unissued shares of the Corporation's Common Stock at the price of
_________________ Dollars ($_____) per share, such Stock Option to be for the
term and upon the terms and conditions hereinafter stated;
NOW, THEREFORE, it is hereby agreed:
1
<PAGE>
1. Grant of Stock Option. Pursuant to said action of the Stock
Option Committee and pursuant to authorizations granted by all appropriate
regulatory and governmental agencies, the Corporation hereby grants to Optionee
a Stock Option to purchase, upon and subject to the terms and conditions of the
Plan, which is incorporated in full herein by this Reference, all or any part of
________________ (_______) Option Shares of the Corporation's Common Stock, at
the price of ____________________ Dollars ($_____) per share. For purposes of
this Agreement and the Plan, the date of grant shall be _________________, 19__.
At the date of grant, Optionee [does] [does not own] stock possessing more than
10% of the total combined voting power of all classes of capital stock of the
Corporation or any Subsidiary.
The Stock Option granted hereunder [is] [is not] intended to
qualify as an Incentive Stock Option within the meaning of Section 422A of the
Internal Revenue Code of 1986, as amended.
2. Exercisability. This Stock Option shall be exercisable as
to ________________ Option Shares on ________________, 19__, as to
__________________ Option Shares on ________________, 19__, as to
__________________ Option Shares on ________________, 19__, as to
__________________ Option Shares on ________________, 19__, and as to
_________________ Option Shares on ________________, 19__. This Stock Option
shall remain exercisable as to all of such Option Shares until _______________,
19__ (but not later than ten (10) years from the date hereof), at which time it
shall expire in its entirety, unless this Stock Option has expired or
2
<PAGE>
terminated earlier in accordance with the provisions hereof. Option shares as to
which this Stock Option becomes exercisable may be purchased at any time prior
to expiration of this Stock Option.
3. Exercise of Stock Option. Subject to the provision of
Paragraph 4 hereof, this Stock Option may be exercised by written notice
delivered to the Corporation stating the number of Option Shares with respect to
which this Stock Option is being exercised, together with cash and/or, if
permitted at the time of exercise by the Stock Option Committee, shares of
Common Stock of the Corporation which, when added to the cash payment, if any,
have an aggregate Fair Market Value equal to the full amount of the purchase
price of such Option Shares, and/or, if permitted at the time of exercise by the
Stock Option Committee and if legally permitted, and if Optionee is not also a
director, consultant or business advisor of the Corporation or any of its
subsidiaries, on a deferred basis evidenced by a promissory note. Not less than
ten (10) Option shares may be purchased at any one time unless the number
purchased is the total number which remains to be purchased under this Stock
Option and in no event may the Stock Option be exercised with respect to
fractional shares. Upon exercise, Optionee shall make appropriate arrangements
and shall be responsible for the withholding of any federal and state income
taxes then due.
4. Prior Outstanding Stock Options. Incentive Stock Options
granted to an Optionee may be exercisable while such Optionee has outstanding
and unexercised any Incentive Stock Option previously granted to him or her
pursuant to
3
<PAGE>
this Plan. The Stock Option Committee shall determine if such options shall be
exercisable if there are any Incentive Stock Options previously granted (or
substituted) to him or her pursuant to this Plan, and such determination shall
be evidenced in the Agreement executed by the Optionee and the Corporation,
subject to the requirements of Rule 260.141.41(f) of the California Commissioner
of Corporations. An Incentive Stock Option shall be treated as outstanding until
it is exercised in full or expires by reason of lapse of time.
5. Cessation of Employment. Except as provided in paragraphs
7, 9, or 11 hereof, if Optionee's status as an Eligible Participant under the
Plan is terminated, this Stock Option shall expire three (3) months thereafter
or on the date specified in Paragraph 2 hereof, whichever is earlier. During
such period after termination of status as an Eligible Participant, this Stock
Option shall be exercisable only as to those increments, if any, which had
become exercisable as of the date on which the Optionee's status as an Eligible
Participant was terminated, and any Stock Options or increments which had not
become exercisable as of such date shall expire and terminate automatically on
such date.
6. Termination for Violation of Standards of Conduct as
Referenced in Optionee's Employee Handbook. If Optionee's status as an Eligible
Participant under the Plan is terminated for violation of the Employer's
Standard of Conduct, the vested portion of this Stock Option shall be
exercisable for a thirty (30) day period following such termination, and
thereafter this Stock Option shall automatically expire and terminate in their
entirety; provided, however, that the Stock Option Committee may,
4
<PAGE>
in its sole discretion, within thirty (30) days of such termination, reinstate
such Stock Options to the status of options terminated for reasons other than
voilations of the Employer's Standards of Conduct, death or disability by giving
written notice of such reinstatements to the Optionee. In the event of such
reinstatement, the Optionee may exercise the Stock Options as provided in
Section 11 herein. Termination for violation of the Employer's Standard of
Conduct shall include, but not be limited to, or termination for malfeasance or
gross misfeasance in the performance of duties or conviction of illegal activity
in connection therewith, and, in any event, the determination of the Stock
Option Committee with respect thereto shall be final and conclusive.
7. Disability or Death of Optionee. If Optionee loses his or
her status as an Eligible Participant under the Plan by reason of death or if
Optionee is disabled while employed by the Corporation or a Subsidiary, or if
Optionee dies or becomes so disabled during the three-month period referred to
in Paragraph 5 hereof, this Stock Option shall automatically expire and
terminate one (l) year after the date of Optionee's disability or death or on
the day specified in Paragraph 2 hereof, whichever is earlier. After Optionee's
disability or death but before such expiration, the person or persons to whom
Optionee's rights under this Stock Option shall have passed by order of a court
of competent jurisdiction or by will or the applicable laws of descent and
distribution, or the executor, administrator or conservator of Optionee's
estate, shall have the right to exercise this Stock Option to the extent that
increments, if any, had become exercisable as of the date on which Optionee's
status
5
<PAGE>
as an Eligible Participant under the Plan had been terminated. For purposes
hereof, "disability" shall have the same meaning as set forth in Section 14 of
the Plan.
8. Nontransferability. This Stock Option shall not be
transferable except by will or by the laws of descent and distribution, and
shall be exercisable during Optionee's lifetime only by Optionee or his or her
guardian or legal representative.
9. Employment. Except for optionees with a written contract
for any definite term, this Agreement shall not obligate the Corporation or a
Subsidiary to employ Optionee.
10. Privileges of Stock Ownership. Optionee shall have no
rights as a stockholder with respect to the Option Shares unless and until said
Option Shares are issued to Optionee as provided in the Plan. Except as provided
in Section 15 of the Plan, no adjustment will be made for dividends or other
rights in respect of which the record date is prior to the date such stock
certificates are issued.
11. Modification and Termination by Board of Directors. The
rights of Optionee are subject to modification and termination upon the
occurrence of certain events as provided in Sections 12, 13, 14, 15 and 16 of
the Plan. Upon adoption by the requisite holders of the Corporation's
outstanding shares of Common Stock of any plan of dissolution, liquidation,
reorganization, merger, consolidation or sale of all or substantially all of the
assets of the Corporation to, or the acquisition of stock representing more than
fifty percent (50%) of the voting power of the Corporation then outstanding by
another corporation or person which would, upon consummation,
6
<PAGE>
result in termination of this Stock Option in accordance with Section 16 of the
Plan, this Stock Option shall become immediately exercisable as to all
unexercised Option Shares notwithstanding the incremental exercise provisions of
paragraph 2 of this Agreement for a period then specified by the Stock Option
Committee, but in any event not less than 30 days, in accordance with Section
8(e) of the Plan, on the condition that the terminating event described in
Section 16 of the Plan is consummated. If such terminating event is not
consummated, this Stock Option shall be exercisable in accordance with the terms
of the Agreement, excepting this Paragraph 11.
12. Notification of Sale. Optionee agrees that Optionee, or
any person acquiring Option Shares upon exercise of this Stock Option, will
notify the Corporation in writing not more than five (5) days after any sale or
other disposition of such Shares.
13. Representations of Optionee. No Option Shares issuable
upon the exercise of this Stock Option shall be issued and delivered unless and
until all requirements of applicable state and federal law and of the Securities
and Exchange Commission pertaining to the issuance and sale of such Option
Shares, and all applicable listing requirements of the securities exchanges, if
any, on which shares of Common Stock of the Corporation of the same class are
then listed, shall have been complied with. Without limiting the foregoing, the
undersigned Optionee hereby agrees, represents and warrants that unless and
until the shares of Common Stock covered by the Plan and issued to Optionee have
been registered with the Securities
7
<PAGE>
and Exchange Commission pursuant to the Securities Act of 1933, as amended,
Optionee will acquire all Option Shares upon exercise of this Stock Option for
investment purposes only and not for resale or for distribution, and Optionee
hereby agrees to execute and deliver to the Corporation a representation letter
in the form and substance of Exhibit "A" attached hereto, and to be bound by the
representations, warranties, covenants and promises contained therein. Optionee
further agrees, represents and warrants that upon exercise of all or part of
this Stock Option, Optionee will not transfer any such Option Shares except in
compliance with said registration provisions or an applicable exemption
therefrom. Upon each exercise of any portion of this Stock Option, the person
entitled to exercise same shall, unless waived by the Corporation, furnish
evidence satisfactory to counsel for the Corporation (including written and
signed representations in the form attached hereto as Exhibit "B") that the
Option Shares are being acquired in good faith for investment purposes only and
not for resale or distribution except in compliance with the state and federal
requirements described above or applicable exemptions therefrom. Furthermore,
the Corporation, may, if it deems appropriate, issue stop transfer instructions
against any Option Shares and affix to any certificate representing such Shares
the legends of the type described in Section 25 of the Plan.
14. Notices. All notices to the Corporation provided for in
this Agreement shall be addressed to it in care of its President or Chief
Financial Officer at its principal office and all notices to Optionee shall be
addressed to Optionee's address on file with the Corporation or a subsidiary
corporation, or to such other
8
<PAGE>
address as either may designate to the other in writing, all in compliance with
the notice provisions set forth in Section 26 of the Plan.
15. Incorporation of Plan. All of the provisions of the Plan
are incorporated herein by reference as if set forth in full hereat. In the
event of any conflict between the terms of the Plan and any provision contained
herein, the terms of the Plan shall be controlling and the conflicting
provisions herein shall be disregarded.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement.
BYL Bancorp
By:
- -----------------------------------
By:
- -----------------------------------
OPTIONEE
-----------------------------------
9
<PAGE>
EXHIBIT 5
Opinion of Knecht & Hansen
<PAGE>
KNECHT & HANSEN
A PARTNERSHIP OF PROFESSIONAL CORPORATIONS
ATTORNEYS AT LAW
RICHARD E. KNECHT 1301 DOVE STREET, SUITE 900 TELECOPIER:
LOREN P. HANSEN NEWPORT BEACH, CALIFORNIA 92660 (714) 851-1732
TELEPHONE: (714) 851-8070
May 15, 1998
Board of Directors
BYL Bancorp
18206 Imperial Highway
Yorba Linda, California 92886
Re: BYL Bancorp - 1997 Stock Option Plan
Gentlemen:
We are acting as counsel for BYL Bancorp in connection
with the registration under the Securities Act of 1933, as amended (the
"Act"), of 460,519 shares of Common Stock, no par value, of BYL Bancorp, a
California corporation, to be issued upon the exercise of options under the
BYL Bancorp 1997 Stock Option Plan (the "Plan"), plus an indeterminate
number of shares as may become subject to options under the Plan
(collectively referred to as the "Shares"). A registration statement on
Form S-8 (the "Registration Statement") will be filed under the Act with
respect to the offering of the Shares. Based upon the examination of such
instruments, documents and records as we deem necessary, including the
Registration Statement, we are of the opinion that:
1. BYL Bancorp has been duly incorporated and is validly
existing under the laws of the State of California.
2. The Shares to be offered by BYL Bancorp under the Plan,
have been duly authorized and legally issued, fully paid, and nonassessable
under the laws of the State of California.
Consent is hereby given to the filing of this opinion as
an Exhibit to the Registration Statement and to the reference to this firm
under the caption "Legal Opinions" in the Exhibits to the Registration
Statement.
Very truly yours,
/s/ Loren P. Hansen
-------------------
Loren P. Hansen of
Knecht & Hansen
<PAGE>
EXHIBIT 23(b)
Consent of independent public accountants
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the inclusion of our Independent Auditor's Report dated
January 30, 1998 regarding the consolidated balance sheets of BYL Bancorp and
Subsidiary as of December 31, 1997 and 1996, and the related consolidated
statements of income, changes in shareholders' equity, and cash flows for each
of the three years in the period ended December 31, 1997, in the Form 10-KSB
filed with the Securities and Exchange Commission (SEC) and incorporated by
reference in the Form S-8 filed by BYL Bancorp with the SEC and the reference
to our firm as experts therein.
/s/ Vavrinck, Trine, Day & Co., LLP
May 15, 1998
Laguna Hills, California
