As filed with the Securities and
Exchange Commission on February 5, 2003
Registration No. 333-__________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
NARA BANCORP, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 95-4170121 | |
| (State of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
3701 Wilshire Boulevard, Suite 220
Los Angeles, California 90010
(Address of Principal Executive Offices)
NARA BANK 2002 STOCK OPTION AGREEMENT — WILLIAM DAVIS
NARA BANK 2002 STOCK OPTION AGREEMENT — MICHEL URICH
(Full title of the plan)
Benjamin B. Hong
President and Chief Executive Officer
NARA BANCORP, INC.
3701 Wilshire Boulevard, Suite 220
Los Angeles, California 90010
(213) 639-1700
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to
:
Nancy H. Wojtas, Esq.
COOLEY GODWARD LLP
5 Palo Alto Square
3000 El Camino Real
Palo Alto, California 94306
(650) 843-5000
CALCULATION OF REGISTRATION FEE
Approximate date of commencement of proposed sale to the public
:
2.
Proposed Maximum
Proposed Maximum
Title of Securities
Amount to be
Offering
Aggregate Offering
Amount of
to be Registered
Registered(1)
Price per Share(2)
Price(2)
Registration Fee
(par value $.001 per
share)
20,000 shares
$
22.04
$
440,800.00
$
40.55
Table of Contents
(1)
In addition, pursuant to Rule 416(a) under the Securities Act of 1933, as
amended (the “Securities Act”), this registration statement shall also
cover any additional shares of the common stock of Nara Bancorp, Inc. (the
“Company”) that become issuable under the Nara Bank 2002 Stock Option
Agreements with each of William Davis and Michel Urich, by reason of any
stock dividend, stock split, recapitalization or other similar transaction
effected without the Company’s receipt of consideration that results in an
increase in the number of the Company’s outstanding shares of common
stock.
(2)
Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(c) and (h)(1) under the Securities
Act. The offering price per share and aggregate offering price for the
unissued stock options and common stock are based upon the average of the
high and low prices of the Company’s common stock on January 30, 2003, as
reported on the Nasdaq National Market. The following chart illustrates
the calculation of the registration fee:
Offering Price per
Aggregate Offering
Securities
Number of Shares
Share
Price
10,000
$
22.04
$
220,400.00
10,000
$
22.04
$
220,400.00
20,000
$
440,800.00
$
40.55
as soon as practicable after this Registration Statement becomes effective.
Table of Contents
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents filed by Nara Bancorp, Inc. (the “Registrant”) with the Securities and Exchange Commission (the “Commission”) are incorporated in this Registration Statement on Form S-8 (this “Registration Statement”) by reference:
a. The Registrant’s Annual Report on Form 10-K for the year ended December 31, 2001, filed with the Commission on April 1, 2002 (“Form 10-K”), as amended by Amendment No. 1 to Form 10-K, filed with the Commission on April 30, 2002.
b. The Registrant’s Definitive Proxy Statement on Schedule 14A, filed with the Commission on May 7, 2002.
c. The Registrant’s Quarterly Reports on Forms 10-Q, for the quarters ended March 31, June 30 and September 30, 2002, respectively, filed with the Commission on May 15, August 14 and November 14, 2002, respectively.
d. The Registrant’s Current Reports on Form 8-K, filed with the Commission on September 26, 2002 and January 28, 2003, respectively.
All other documents filed by the Registrant pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Registration Statement and prior to the filing of a post-effective amendment which indicate that all securities offered 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 of such documents.
Any statement made in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained herein or in any other subsequently filed document which is also incorporated or deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement.
Item 4. Description of Securities
The Registrant’s certificate of incorporation, as amended, authorizes the issuance of up to 20,000,000 shares of the Registrant’s common stock, $0.001 par value per share. Currently, the Registrant has approximately 5,545,928 shares of common stock outstanding. The Registrant’s certificate of incorporation does not provide for any other class of stock.
The Registrant’s common stock has no preemptive, conversion or redemption rights or sinking fund provisions and all of the issued and outstanding shares of the Registrant’s common stock are fully paid and nonassessable. The Registrant is empowered by Delaware law to buy its shares of stock from its stockholders at the mutual accord of the stockholder and the Registrant.
3.
Holders of the Registrant’s common stock are entitled to one vote, in person or by proxy, for each share of the Registrant’s common stock held of record in the stockholder’s name on the books of the Registrant as of the record date on any matter submitted to the vote of the stockholders. Cumulative voting in the election of directors is not available to stockholders of the Registrant. Each share of the Registrant’s common stock has the same rights, privileges and preferences as every other share and will share equally in the Registrant’s net assets upon liquidation or dissolution after satisfaction of liabilities.
The Registrant’s stockholders are entitled to dividends when, and if, declared by the Registrant’s board of directors out of funds legally available therefor, and after satisfaction of the prior rights of holders of outstanding preferred stock, if any (subject to certain restrictions on payment of dividends imposed by the laws of Delaware).
The Registrant’s bylaws, as amended, provide that a special meeting of the stockholders may be called by, among others, a holder or holders of 10% or more of the outstanding stock of the Registrant. The Registrant’s bylaws also provide that any action that is required or permitted to be taken by stockholders at an annual or special meeting may be taken by a written consent without a meeting, if the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote were present and voted, signed the consent.
The Registrant is covered by the anti-takeover provisions in Delaware law, which may discourage a future takeover attempt in which stockholders might receive a premium for their shares over the then-current market price and may make removal of incumbent management more difficult.
The Delaware General Corporation Law provides that buyers who acquire more than 15% of the outstanding stock of a Delaware corporation, such as the Registrant, are prohibited from completing a hostile takeover of such corporation for three years. However, the takeover can be completed if: (i) the buyer, while acquiring the 15% interest, acquires at least 85% of the corporation’s outstanding stock (the 85% requirement excludes shares held by directors who are also officers and certain shares held under employee stock plans), or (ii) the takeover is approved by the target corporation’s board of directors and two-thirds of the shares of outstanding stock of the corporation (excluding shares held by the bidder). The Registrant is governed by this provision of the Delaware General Corporation Law.
Certain provisions of the Registrant’s bylaws will impede changes in majority control of the Registrant’s board of directors. The Registrant’s bylaws provide that:
1. the size of the board of directors may be increased or decreased either by a majority vote of the whole board or a majority vote of the outstanding capital stock entitled to vote;
2. any vacancy occurring in the board of directors, including a vacancy created by an increase in the number of directors, shall be filled for the remainder of the unexpired term by a majority vote of the directors then in office;
3. a director, in general, may only be removed by the affirmative vote of a majority of the shares eligible to vote; and
4.
4. nominations for election to the board of directors may be made by the board of directors or by any stockholder of any outstanding capital stock of the Registrant entitled to vote for the election of directors.
Nominations, other than those made by or on behalf of the management of the Registrant, must be made in writing and be delivered or mailed to the president of the Registrant not less than 14 days nor more than 50 days prior to any meeting of stockholders called for the election of directors. If less than 21 days’ notice of the meeting is given to the stockholders, these nominations shall be mailed or delivered to the president of the Registrant before the close of business on the seventh day following the day on which the notice of meeting was mailed. This notification shall contain the name and address of each proposed nominee, the principal occupation of each proposed nominee, the total number of shares of capital stock of the Registrant owned by each proposed nominee, the name and address of the notifying stockholder and the number of shares of capital stock of the Registrant owned by the notifying stockholder. Nominations not made in accordance with these procedures may be disregarded by the chairman of the meeting, and upon his instructions, the vote tellers may disregard all votes cast for each such nominee.
Amendments to the Registrant’s certificate of incorporation require the approval of a majority vote of the Registrant’s board of directors and also by a majority of the outstanding shares of the Registrant’s voting stock. The Registrant’s bylaws may be amended by a majority vote of the board of directors or the affirmative vote of a majority of the total votes eligible to be voted at a duly constituted meeting of stockholders.
The Registrant is authorized to issue common stock from time to time under its certificate of incorporation. In the event of a proposed merger, tender offer or other attempt to gain control of the Registrant that the board of directors does not approve, it might be possible for the board of directors to authorize the issuance of shares of common stock that would impede the completion of such a transaction. An effect of the possible issuance of common stock, therefore, may be to deter a future takeover attempt.
Item 5. Interests of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Directors and Officers
The Registrant’s certificate of incorporation, as amended, provides that its directors and officers shall be indemnified to the fullest extent permissible under Delaware law. The certificate of incorporation also provides that a director shall not be liable to the Registrant or its stockholders for monetary damages for breach of fiduciary duty as a director. The Registrant’s bylaws provide that the Registrant shall indemnify any director, officer, employee or agent of the Registrant for reasonable expenses actually incurred in connection with any proceeding to which he or she was made a party by reason of his or her having served the Registrant as a director, officer, employee or agent; provided, that no person shall be indemnified if found liable to the Registrant as a result of an action or suit by or in the right of the Registrant, and that any indemnification amount shall be approved by a majority of the board of directors who were not parties to the action or suit, or by the stockholders.
5.
Section 102(b) of the Delaware General Corporation Law authorizes a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to corporation or its stockholders for monetary damages for breach or alleged breach of the director’s “duty of care.” While this statute does not change directors’ duty of care, it enables corporations to limit available relief to equitable remedies such as injunction or rescission. The statute has no effect on a director’s duty of loyalty or liability for acts or omissions not in good faith or involving intentional misconduct or knowing violations of law, illegal payment of dividends or stock redemptions or repurchases, or for any transaction from which the director derives an improper personal benefit. As permitted by the statute, the Registrant has adopted provisions in its certificate of incorporation which eliminate to the fullest extent permissible under Delaware law the personal liability of its directors to the Registrant and its stockholders for monetary damages for breach or alleged breach of their duty of care.
Section 145 of the Delaware General Corporation Law provides for the indemnification of officers, directors, employees and agents of a corporation. The Registrant’s bylaws provide for indemnification of its directors, officers, employees and agents to the fullest extent permitted under Delaware law, including those circumstances in which indemnification would otherwise be discretionary under Delaware law. The Registrant’s bylaws also empower it to enter into indemnification agreements with its directors and officers and to purchase insurance on behalf of any person whom it is required or permitted to indemnify. The Registrant has entered into agreements with its directors and certain of its executive officers that require the Registrant to indemnify such persons to the fullest extent permitted under Delaware law against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred (including expenses of a derivative action) in connection with any proceeding, whether actual or threatened, to which any such person may be made a party by reason of the fact that such person is or was a director or an executive officer of the Registrant or any of its affiliated enterprises. The indemnification agreements also set forth certain procedures that will apply in the event of a claim for indemnification thereunder.
Section 145 of the Delaware General Corporation Law provides for indemnification in terms sufficiently broad to indemnify such individuals, under certain circumstances, for liabilities (including reimbursement of expenses incurred) arising under the Securities Act.
Item 7. Exemption from Registration Claimed
Not Applicable.
Item 8. Exhibits
Exhibit Number
Exhibit Description
3.3
Certificate of Amendment to the Registrant’s Certificate of
Incorporation, as filed with the Secretary of State of the
State of Delaware on May 31, 2002
5.1
Opinion of Cooley Godward LLP
23.1
Consent of Deloitte & Touche, LLP, Independent Auditors
23.2
Consent of Cooley Godward LLP is contained in Exhibit 5.1
to this Registration Statement
24.1
Power of Attorney is contained on the signature page to
this Registration
6.
Exhibit Number
Exhibit Description
Statement
99.1
Form of Nara Bank 2002 Stock Option Agreement
Item 9. Undertakings
1. The undersigned registrant hereby undertakes:
a. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement.
(iii) 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;
provided, however , that paragraphs (a)(i) and (a)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference herein.
b. That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
c. 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.
2. The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
3. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing
7.
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 Securities 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 or 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 Securities Act and will be governed by the final adjudication of such issue.
8.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, 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 Los Angeles, State of California, on February 5, 2003.
| NARA BANCORP, INC. | ||||
| By: | /s/ Benjamin Hong | |||
|
|
||||
| Benjamin Hong | ||||
| President and Chief Executive Officer | ||||
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Benjamin Hong and Bon T. Goo, and each or any one of them, his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective 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 agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their, his, or her substitutes or substitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated:
| Signature | Title | Date | ||
|
|
|
|
||
|
/s/ Benjamin Hong
Benjamin Hong |
President and Chief Executive Officer (Principal Executive Officer), Director | February 5, 2003 | ||
|
/s/ Bon T. Goo
Bon T. Goo |
Executive Vice President and Chief Financial Officer (Principal Financial Officer, Principal Accounting Officer) | February 5, 2003 | ||
|
/s/ Thomas Chung
Thomas Chung |
Chairman of the Board | February 5, 2003 | ||
|
/s/ Jesun Paik
Jesun Paik |
Director | February 5, 2003 | ||
|
/s/ Ki Suh Park
Ki Suh Park |
Director | February 5, 2003 | ||
|
/s/ Steve Y. Kim
Steve Y. Kim |
Director | February 5, 2003 | ||
|
/s/ Yong Hwan Kim
Yong Hwan Kim |
Director | February 5, 2003 | ||
|
/s/ John M. Park
John M. Park |
Director | February 5, 2003 |
EXHIBIT INDEX
EXHIBIT NUMBER
DESCRIPTION
3.3
Certificate of Amendment to the Registrant’s Certificate of
Incorporation, as filed with the Secretary of State of the
State of Delaware on May 31, 2002
5.1
Opinion of Cooley Godward LLP
23.1
Consent of Deloitte & Touche, LLP, Independent Auditors
23.2
Consent of Cooley Godward LLP is contained in Exhibit 5.1
to this Registration Statement
24.1
Power of Attorney is contained on the signature page to
this Registration Statement
99.1
Form of Nara Bank 2002 Stock Option Agreement
Exhibit 3.3
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 02:00 PM 05/31/2002
020349418 - 3239893
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
NARA BANCORP, INC.
a Delaware Corporation
NARA BANCORP, INC., a corporation organized and existing under and by virtue of the laws of the State of Delaware (the "Corporation"), hereby certifies as follows:
1. That Article IV to the Certificate of Incorporation of the Corporation is amended to read in full as follows:
IV.
"The total number of shares of all classes of stock which the Corporation shall have authority to issue is twenty million (20,000,000) shares of Common Stock, $0.001 par value per share ("Common Stock"). Except to the extent required by governing law, rule or regulation, the shares of capital stock may be issued from time to time by the Board of Directors without further approval of stockholders. The Corporation shall have the authority to purchase its capital stock out of funds lawfully available therefore, which funds shall include, without limitation, the Corporation's unreserved and unrestricted capital surplus."
2. That said amendment has been duly adopted in accordance with Section 242 of the Delaware General Corporation Law by:
(a) the adoption of resolutions of the Board of Directors of the Corporation; and
(b) the adoption of resolutions by the holders of a majority of the outstanding shares of capital stock entitled to vote thereon.
IN WITNESS WHEREOF, said NARA BANCORP, INC., has caused this Certificate of Amendment to be signed by Michel Urich, its Secretary, the 30th day of May, 2002.
/s/ Michel Urich ----------------------------------- Michel Urich, Secretary |
EXHIBIT 5.1
[Cooley Godward LLP Letterhead]
February 4, 2003
Nara Bancorp, Inc.
3701 Wilshire Boulevard, Suite 220
Los Angeles, California 90010
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in connection with the filing by Nara Bancorp, Inc. (the "Company") of a Registration Statement on Form S-8 (the "Registration Statement") with the Securities and Exchange Commission covering the offering of an aggregate of 20,000 shares of the Company's common stock, $.001 par value (the "Shares"), pursuant to the Company's 2002 Stock Option Agreements with William Davis and Michel Urich, respectively (collectively, the "Agreements").
In connection with this opinion, we have examined the Registration Statement and related Prospectus, your Amended Certificate of Incorporation and Bylaws and such other documents, records, certificates, memoranda and other instruments as we deem necessary as a basis for this opinion. We have assumed the genuineness and authenticity of all documents submitted to us as originals, the conformity to originals of all documents submitted to us as copies thereof and the due execution and delivery of all documents where due execution and delivery are a prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, we are of the opinion that the Shares, when sold and issued in accordance with the Agreements, the Registration Statement and the related Prospectus, will be validly issued, fully paid and nonassessable (except as to shares issued pursuant to certain deferred payment arrangements, which will be fully paid and nonassessable when such deferred payments are made in full).
We consent to the filing of this opinion as an exhibit to the Registration Statement.
Very truly yours,
Cooley Godward LLP
By: /s/ Nancy H. Wojtas
----------------------
Nancy H. Wojtas
|
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of Nara Bancorp, Inc. on Form S-8 of our report dated March 26, 2002, appearing in the Annual Report on Form 10-K of Nara Bancorp, Inc. for the year ended December 31, 2001.
/s/ Deloitte & Touche LLP Los Angeles, California January 30, 2003 |
Exhibit 99.1
FORM OF
NARA BANCORP, INC.
NARA BANK 2002 STOCK OPTION GRANT NOTICE
Nara Bancorp, Inc. (the "COMPANY"), hereby grants to the Optionholder named below an option to purchase the number of shares of the Company's common stock set forth below. The terms and conditions of the Option are set forth in this Stock Option Agreement (the "AGREEMENT") and the Notice of Exercise, both of which are enclosed herewith and incorporated herein in their entirety.
Optionholder: ____________________
Date of Grant: ______________, 2001
Number of Shares Subject to Option: ____________________
Exercise Price Per Share: $___________________
Expiration Date: ______________, 2011
Type of Grant: [X] Nonstatutory Stock Option
Vesting Schedule: _____________________________________________________________
Payment: By one or a combination of the following items (as
described in Section 3 of this Agreement):
By cash or check
Pursuant to a Regulation T Program
By delivery of already-owned shares
|
ACKNOWLEDGEMENTS: By signing this cover sheet, you acknowledge receipt of, and understand and agree to, all of the terms and conditions described in this Agreement and Notice of Exercise, a copy of which also is enclosed. Further, you acknowledge that as of the Date of Grant, this Agreement and the Notice of Exercise set forth the entire understanding between you and the Company regarding the acquisition of stock in the Company and supersede all prior oral and written agreements (including, without limitation, any employment agreement with the Company) on that subject.
NARA BANCORP, INC.: OPTIONHOLDER: By:________________________________ __________________________________ Signature Signature Name:______________________________ Date:_____________________________ Title:_____________________________ Date:______________________________ Attachments: Agreement and Notice of Exercise |
NARA BANK 2002 STOCK OPTION AGREEMENT
The details of your option ("OPTION") to purchase shares of the Company's common stock (such common stock, or any security of the Company issued in substitution, exchange or lieu thereof, "COMMON STOCK") granted pursuant to this Agreement are as follows:
1. VESTING. Subject to the limitations contained herein, your Option will vest as provided in the Grant Notice, provided that vesting will cease upon the termination of your Continuous Service. For purpose of this Agreement, the term "CONTINUOUS SERVICE" means that your service with Nara Bancorp, Inc. (the "COMPANY"), or any corporation or entity that is a subsidiary of the Company ("SUBSIDIARY") within the meaning of Section 424(f) of the Internal Revenue Code of 1986, as amended (the "CODE"), whether as an employee, director or consultant, is not interrupted or terminated. Your Continuous Service shall not be deemed to have terminated merely because of a change in the capacity in which you render services to the Company or a Subsidiary as an employee, director or consultant or a change in the entity for which you render such service, provided that there is no interruption or termination of your Continuous Service. For example, a change in status from an employee of the Company to a director of the Company will not constitute an interruption of Continuous Service. The board of directors of the Company (the "BOARD") or the chief executive officer of the Company, in that party's sole discretion, may determine whether Continuous Service shall be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal leave.
2. NON-QUALIFIED OPTIONS. The Option granted under this Agreement is in the form of a Non-Qualified Stock Option, subject to the terms and conditions set forth in this Agreement. The Option is not intended to qualify as an incentive stock option within the meaning of Section 422 of the Code.
3. NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of
Common Stock subject to your Option and your exercise price per share, as set
forth on the cover sheet of this Agreement, may be adjusted from time to time
for adjustments upon changes in capitalization of the Company. In the event of
any change in capitalization affecting the Common Stock after the effective date
of this Agreement, such as a stock dividend, stock split, recapitalization,
merger, consolidation, split-up, combination, exchange of shares, other form of
reorganization or any other change affecting the Common Stock, such
proportionate adjustments, if any, as the Board in its discretion may deem
appropriate to reflect such change shall be made with respect to (i) the number
of shares of Common Stock subject to your Option pursuant to this Agreement, and
(ii) the exercise price per share. Adjustments may also be made in the number of
shares covered by, and the price or other value of your Option in the event of a
spin-off or other distribution (other than normal cash dividends) of Company
assets to stockholders.
4. METHOD OF PAYMENT. Payment of the exercise price is due in full upon exercise of all or any part of your Option. You may elect to make payment of the exercise price in cash or by check or in any other manner permitted on the cover sheet of this Agreement, which may include one or more of the following:
(A) In the Company's sole discretion at the time your Option is exercised, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board which, prior to the issuance of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds.
2.
(B) In the Company's sole discretion at the time your Option is exercised, by Delivery of already-owned shares of Common Stock that either have been held for the period required to avoid a charge to the Company's reported earnings (generally six months) or were not acquired, directly or indirectly from the Company, that are owned free and clear of any liens, claims, encumbrances or security interests, and that are valued at the Fair Market Value on the date of exercise.
(C) For the purpose of this Agreement, "DELIVERY," in the sole discretion of the Company at the time your Option is exercised, shall include delivery to the Company of your attestation of ownership of such shares of Common Stock in a form approved by the Company. Notwithstanding the foregoing, your Option may not be exercised by tender to the Company of Common Stock to the extent such tender would constitute a violation of the provisions of any law, regulation or agreement restricting the redemption of the Company's stock.
(D) For the purpose of this Agreement, "FAIR MARKET VALUE" means, on any given date, the closing price for the Common Stock on such date, or, if the Common Stock was not traded on such date, on the next preceding day on which the Common Stock was traded, determined in accordance with the following rules:
(I) If the Common Stock is admitted to trading or listing on a national securities exchange registered under the Exchange Act, the closing price for any day shall be the last reported sale price during the last regular business day, or in the case no such reported sale takes place on such date, the average of the last reported bid and ask prices during the last regular business day, in either case on the principal national securities exchange on which the Common Stock is admitted to trading or is listed, or
(II) If not admitted to trading or listed on any national securities exchange, the last sale price of the Common Stock on the National Association of Securities Dealers Automated Quotation National Market System ("NMS") or, in case no such reported sale takes place, the average of the closing bid and ask prices on such date, or
(III) If not quoted on the NMS, the average of the closing bid and ask prices of the Common Stock on the National Association of Securities Dealers Automated Quotation System ("NASDAQ") or any comparable system, or
(IV) If the Common Stock is not listed on NASDAQ or any comparable system, the closing bid and ask prices as furnished by any member of the National Association of Securities Dealers, Inc., selected from time to time by the Company for that purpose.
5. WHOLE SHARES. Your Option may only be exercised for whole shares.
6. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary contained herein, your Option may not be exercised unless the shares issuable upon exercise of your Option are then registered under the Securities Act of 1933, as amended (the "SECURITIES ACT") or, if such shares are not then so registered, the Company has determined that such exercise and issuance would be exempt from the registration requirements of the Securities Act. The exercise of your Option must also comply with other applicable laws and regulations governing the Option, and the Option may not be exercised if the Company determines that the exercise would not be in material compliance with such laws and regulations.
7. TERM. The term of your Option commences on the Date of Grant, as set forth on the cover sheet of this Agreement ("DATE OF GRANT") and expires upon the earliest of the following:
3.
(A) three (3) months after the termination of your Continuous Service for any reason other than Disability (defined below) or death, provided that if during any part of such three (3) month period the Option is not exercisable solely because of the condition set forth in paragraph 6 hereto, the Option shall not expire until the earlier of the Expiration Date set forth on the cover sheet of this Agreement ("EXPIRATION DATE") or until it shall have been exercisable for an aggregate period of three (3) months after the termination of your Continuous Service;
(B) twelve (12) months after the termination of your Continuous Service due to Disability;
(C) twelve (12) months after your death if you die either during your Continuous Service or within three (3) months after your Continuous Service terminates;
(D) the Expiration Date; or
(E) the tenth (10th) anniversary of the Date of Grant.
For the purpose of this Agreement, "DISABILITY" means permanent and total
disability as determined by the Board in accordance with the standards under
Section 22(e)(3) of the Code.
8. EXERCISE.
(A) You may exercise the vested portion of your Option during its term by delivering a Notice of Exercise (in a form designated by the Company) together with the exercise price to the Secretary of the Company, or to such other person as the Company may designate, during regular business hours, together with such additional documents as the Company may then require.
(B) By exercising your Option you agree that, as a condition to any exercise of your Option, the Company may require you to enter an arrangement providing for the payment by you to the Company of any tax withholding obligation of the Company arising by reason of (1) the exercise of your Option or (2) the lapse of any substantial risk of forfeiture to which the shares are subject at the time of exercise.
9. CHANGE IN CONTROL.
(A) In the event of a Change in Control (as defined in paragraph (b) below) of the Company, and except as otherwise provided in this Agreement, if your Option is then outstanding, it shall become fully vested and exercisable as of the date of the Change in Control (and shall terminate at such time as specified in this Agreement).
(B) A "CHANGE IN CONTROL" shall be deemed to have occurred upon the occurrence of any one (or more) of the following events:
(I) Any person, including a group as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), becomes the beneficial owner of shares of the Company with respect to which 25% or more of the total number of votes for the election of the Board may be cast;
(II) As a result of, or in connection with, any cash tender offer, exchange offer, merger or other business combination, sale of assets or contested election or combination
4.
of the foregoing, persons who were directors of the Company just prior to such event shall cease to constitute a majority of the Board;
(III) The stockholders of the Company shall approve an agreement providing either for a transaction in which the Company will cease to be an independent publicly owned corporation or for a sale or other disposition of all or substantially all of the assets of the Company; or
(IV) A tender offer or exchange offer is made for shares of Common Stock (other than one made by the Company) and shares of Common Stock are acquired thereunder (an "OFFER"). However, the acceleration of the exercisability of outstanding options upon the occurrence of an Offer shall be within the discretion of the Board.
(V) The formation of a holding company for the Company in which the shareholdings of the holding company after its formation are substantially the same as for the Company prior to the holding company formation does not constitute a Change in Control for purposes of this Agreement.
(C) In the event that any payment under this Agreement (alone or in conjunction with other payments) would otherwise constitute an "parachute payment" under Section 280G of the Code (in the sole judgment of the Company), such payment shall be reduced or eliminated to the extent the Company determines necessary to avoid deduction disallowance under Section 280G of the Code or the imposition of excise tax under Section 4999 of the Code. The Company may consult with you regarding the application of Section 280G and/or Section 4999 to payments otherwise due to you under this Agreement, but the judgment of the Company as to applicability of those provisions, the degree to which a payment must be reduced to avoid those provisions and whether your Option shall be reduced, is final. The Board shall act on behalf of the Company in interpreting and administering this limitation.
10. TRANSFERABILITY. Your Option is not transferable, except by will or by the laws of descent and distribution, and is exercisable during your life only by you. Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, shall thereafter be entitled to exercise your Option.
11. OPTION NOT A SERVICE CONTRACT. Your Option is not an employment or service contract, and nothing in your Option shall be deemed to create in any way whatsoever any obligation on your part to continue in the employ of the Company or a Subsidiary, or of the Company or a Subsidiary to continue your employment. In addition, nothing in your Option shall obligate the Company or a Subsidiary, their respective stockholders, boards of directors, officers or employees to continue any relationship that you might have as a director for the Company or a Subsidiary.
12. WITHHOLDING OBLIGATIONS.
(A) At the time your Option is exercised, in whole or in part, or at any time thereafter as requested by the Company, you hereby authorize withholding from payroll and any other amounts payable to you, and otherwise agree to make adequate provision for (including by means of a "cashless exercise" pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or a Subsidiary, if any, which arise in connection with your Option.
(B) Upon your request and subject to approval by the Company, in its sole discretion, and compliance with any applicable conditions or restrictions of law, the Company may
5.
withhold from fully vested shares of Common Stock otherwise issuable to you upon the exercise of your Option a number of whole shares having a Fair Market Value, determined by the Company as of the date of exercise, not in excess of the minimum amount of tax required to be withheld by law. Any adverse consequences to you arising in connection with such share withholding procedure shall be your sole responsibility.
(C) Your Option is not exercisable unless the tax withholding obligations of the Company and/or any Subsidiary are satisfied. Accordingly, you may not be able to exercise your Option when desired even though your Option is vested, and the Company shall have no obligation to issue a certificate for such shares or release such shares from any escrow provided for herein.
13. ADMINISTRATION. The Board shall administer the terms and conditions of the Agreement. The Board shall have the power, subject to, and within the limitations of, the express provisions of the Agreement:
(A) to construe and interpret the Agreement, and to establish, amend and revoke rules and regulations for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Agreement, in a manner and to the extent it shall deem necessary or expedient to make the Agreement fully effective. All decisions and interpretations of the Board shall be binding on all persons, and
(B) to amend the Agreement, as provided in Section 14 hereto, and
(C) generally, to exercise such powers and to perform such acts as the Board deems necessary or expedient to promote the best interests of the Company that are not in conflict with the provisions of the Agreement.
14. AMENDMENT. The Board may at any time amend the Agreement in such respects as the Board may deem advisable; provided, however, that the Board may not amend the Agreement to impair your outstanding rights under the Agreement without your consent.
15. NOTICES. Any notices provided for in your Option shall be given in writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by the Company to you, five (5) days after deposit in the United States mail, postage prepaid, addressed to you at the last address you provided to the Company.
16. GOVERNING LAW. This Agreement and all actions taken hereunder shall be governed by and construed in accordance with the laws of the State of California.
By signing the cover sheet of this Agreement, you agree to all of the term and conditions described above.
6.
NOTICE OF STOCK OPTION EXERCISE
NARA BANCORP, INC.
NARA BANK 2002 STOCK OPTION AGREEMENT
Ladies and Gentlemen:
This constitutes notice under my Option that I elect to purchase the number of shares for the price set forth below.
Type of option (check one): Nonstatutory [ ] Stock option dated: ______________________________________ Number of shares as to which option is exercised: ______________________________________ Certificates to be issued in name of: ______________________________________ Total exercise price: ______________________________________ Cash payment delivered herewith: ______________________________________ |
By this exercise, I agree (a) to provide such additional documents as you may require pursuant to the terms of the 2002 Stock Option Agreement and (b) to provide for the payment by me to you (in the manner designated by you) of your withholding obligation, if any, relating to the exercise of this option.
I hereby make the following certifications and representations with respect to the number of shares of common stock of the Company listed above (the "SHARES"), which are being acquired by me for my own account upon exercise of the Option as set forth above:
I acknowledge that I will only be able to resell the Shares under Rule 144 promulgated under the Securities Act of 1933, as amended, or another available exemption.
I further acknowledge that all certificates representing any of the Shares subject to the provisions of the Option shall have endorsed thereon appropriate legends reflecting the foregoing in limitations, as well as any legends reflecting restrictions pursuant to the Company's organizational documents and/or applicable securities laws.
I further acknowledge that there may be tax consequences as a result of the purchase or disposition of the Shares, and I have consulted with any tax consultants I wished to consult and I am not relying on the Company for any tax advice.
Very truly yours,