Exhibit 10(b)
Amended and Restated
TCF Financial Incentive Stock Program
(As submitted to the TCF Annual Stockholders’
Meeting on April 28, 2004 and amended on October 16, 2006
and amended and restated on January 21, 2008)
1.
Purpose; Program Renewal
.
The
purpose of the TCF Financial Incentive Stock Program (the “Program”) is to
attract and retain outstanding individuals as officers and other employees of
TCF Financial Corporation (the “Company”) and its subsidiaries, and to furnish
incentives to such persons by providing such persons opportunities to acquire
common shares of the Company, par value $.01 per share (the “Common Shares”),
or monetary payments based on the value of such shares or the financial
performance of the Company, or both, on advantageous terms as herein provided
(the “Benefits”).
This
Program is a renewal of the TCF Financial 1995 Incentive Stock Program (the “Prior
Program”).
2.
Administration
.
The
Program will be administered by a committee (the “Committee”) of at least two
persons which shall be either the Compensation Committee of the Board of
Directors of the Company or such other committee comprised entirely of “disinterested
persons” as defined in Rule 16b-3 of the Securities and Exchange
Commission and “independent directors” as defined under the rules of the
New York Stock Exchange as the Board of Directors may from time to time
designate. In addition, if necessary for purposes of Section 162(m) of
the Internal Revenue Code of 1986, as amended (the “Code”), membership on the
Committee shall be limited to individuals who qualify as “outside directors”
under that Section. The Committee shall interpret the Program, prescribe,
amend and rescind rules and regulations relating thereto, and make all
other determinations necessary or advisable for the administration of the
Program. A majority of the members of the Committee shall constitute a
quorum, and all determinations of the Committee shall be made by a majority of
its members. Any determination of the Committee under the Program may be
made without notice of meeting of the Committee by a writing signed by a
majority of the Committee members.
3.
Participants
.
Participants
in the Program will consist of such officers and other employees of the Company
and its subsidiaries as the Committee in its sole discretion may designate from
time to time to receive Benefits hereunder. The Committee’s
1
designation
of a participant in any year shall not require the Committee to designate such
person to receive a Benefit in any other year. The Committee shall
consider such factors as it deems pertinent in selecting participants and in
determining the type and amount of their respective Benefits, including without
limitation (i) the financial condition of the Company; (ii) anticipated
profits for the current or future years; (iii) contributions of
participants to the profitability and development of the Company; and (iv) other
compensation provided to participants.
4.
Types of Benefits
.
Benefits
under the Program may be granted in any one or a combination of (a) Incentive
Stock Options; (b) Non-qualified Stock Options; (c) Stock
Appreciation Rights; (d) Restricted Stock Awards; and (e) Performance
Units or Performance Stock, all as described below and pursuant to the Plans
set forth in paragraphs 6-10 hereof. Notwithstanding the foregoing, the
Committee may not award more than 400,000 shares [800,000 shares after giving
effect to a two-for-one stock split on September 3, 2004. (the “Company 2004 Stock Split”)] in the
aggregate in the form of Incentive Stock Options, Non-qualified Stock Options
and Stock Appreciation Rights combined in any one calendar year to any
individual participant, and the Committee may not award more than 350,000 shares
[700,000 shares after giving effect to the Company 2004 Stock Split] of
Performance Stock in any one calendar year to any individual participant. The
Committee may not award monetary value of Performance Units greater than two
percent (2%) of the Corporation’s net income (as defined below) to the Chief
Executive Officer in any one calendar year, or one percent (1%) of the
Corporation’s net income (as defined below) in any one calendar year to any
other individual participant, in each case reduced by the monetary value of any
cash awards under the TCF Performance-Based Compensation Policy. Any
Benefits awarded under the Program shall be evidenced by a written agreement (an
“Award Agreement”) containing such terms and conditions as the Committee may
determine, including but not limited to vesting of Benefits.
5.
Shares Reserved Under the Program
.
There
is hereby reserved for issuance under the Program, subject to subsequent
adjustments under paragraph 17, all of the shares remaining available for
issuance under the Prior Program as of March 1, 2004, a total of 2,458,739
shares [4,917,478 shares after giving effect to the Company 2004 Stock split].
If there is a lapse, expiration, termination or cancellation of any Benefit
granted hereunder or under the Prior Program without the issuance of unrestricted
Common Shares or payment of cash thereunder, the shares subject to or reserved
for such Benefit may again be used for new options, rights or awards of any
sort authorized under this Program.
6.
Incentive Stock Option Plan
.
Incentive
Stock Options will consist of options to purchase Common Shares at purchase
prices not less than one hundred percent (100%) of the Fair Market Value (as
defined in paragraph 16 below) of such Common Shares on the date of grant.
2
Incentive
Stock Options will not be exercisable more than ten (10) years after the
date of grant. In the event of termination of employment for any reason
other than retirement, disability or death, the right of the optionee to
exercise an Incentive Stock Option shall terminate upon the earlier of the end
of the original term of the option or three (3) months after the optionee’s
last day of work for the Company and its subsidiaries. If the optionee should
die within three (3) months after termination of employment for any reason
other than retirement or disability, the right of his or her
successor-in-interest to exercise an Incentive Stock Option shall terminate
upon the earlier of the end of the original term of the option or three (3) months
after the date of such death. In the event of termination of employment
due to retirement or disability, or if the optionee should die while employed,
the right of the optionee or his or her successor in interest to exercise an
Incentive Stock Option shall terminate upon the earlier of the end of the
original term of the option or twelve (12) months after the date of such
retirement, disability or death. If the optionee should die within twelve (12)
months after termination of employment due to retirement or disability, the
right of his or her successor-in-interest to exercise an Incentive Stock Option
shall terminate upon the later of twelve (12) months after the date of such
retirement or disability or three (3) months after the date of such death,
but not later than the end of the original term of the option. The
aggregate fair market value (determined as of the time the Option is granted)
of the Common Shares with respect to which Incentive Stock Options are exercisable
for the first time by any individual during any calendar year (under all option
plans of the Company and its subsidiaries) shall not exceed $100,000. An
Incentive Stock Option granted to a participant who is subject to Section 16
of the Securities Exchange Act of 1934, as amended (the “Securities Exchange
Act”), may be exercised only after six (6) months from its grant date
(unless otherwise permitted under Rule 16b-3 of the Securities and
Exchange Commission).
7.
Non-qualified Stock Option Plan
.
Non-qualified
Stock Options will consist of options to purchase Common Shares at purchase
prices not less than eighty-five percent (85%) of the Fair Market Value of such
Common Shares on the date of grant. Non-qualified Stock Options will be
exercisable over not more than ten (10) years after the date of
grant. Unless otherwise provided in the applicable Award Agreement, in
the event of termination of employment for any reason other than retirement,
disability or death, the right of the optionee to exercise a Non-qualified
Stock Option shall terminate upon the earlier of the end of the original term
of the option or three (3) months after the optionee’s last day of work
for the Company and its subsidiaries. Unless otherwise provided in the
applicable Award Agreement, if the optionee should die within three (3) months
after termination of employment for any reason other than retirement or
disability, the right of his or her successor-in-interest to exercise a
Non-qualified Stock Option shall terminate upon the earlier of the end of the
original term of the option or three (3) months after the date of such
death. Unless otherwise provided in the
applicable Award Agreement, in the event of termination of employment due to
retirement or disability, or if the optionee should die while employed, the
right of the optionee or his or her successor-in-interest to exercise a
Non-qualified Stock Option shall terminate upon the earlier of the end of the
original term of the option or twelve (12) months after the date of such
retirement, disability or
3
death.
Unless otherwise provided in the applicable Award Agreement, if the optionee
should die within twelve (12) months after termination of employment due to
retirement or disability, the right of his or her successor-in-interest to
exercise a Non-qualified Stock Option shall terminate upon the later of twelve
(12) months after the date of such retirement or disability or three (3) months
after the date of such death, but not later than the end of the original term
of the option. A Non-qualified Stock Option granted to a participant who
is subject to Section 16 of the Securities Exchange Act may be exercised
only after six (6) months from its grant date (unless otherwise permitted
under Rule 16b-3 of the Securities and Exchange Commission).
8.
Stock Appreciation Rights Plan
.
The
Committee may, in its discretion, grant a Stock Appreciation Right to the
holder of any Stock Option granted hereunder or under the Prior Stock Option
Programs. Such Stock Appreciation Rights shall be subject to such terms
and conditions consistent with the Program as the Committee shall impose from
time to time, including the following:
(a)
A Stock Appreciation Right may be granted
with respect to a Stock Option at the time of its grant or at any time
thereafter.
(b)
Subject to paragraph 8(d) below, Stock
Appreciation Rights will permit the holder to surrender any related Stock
Option or portion thereof which is then exercisable and to elect to receive in
exchange therefor cash in an amount equal to:
(i)
The excess of the Fair Market Value on the
date of such election of one Common Share over the option price multiplied by
(ii)
The number of shares covered by such option
or portion thereof which is so surrendered.
(c)
A Stock Appreciation Right granted to a
participant who is subject to Section 16 of the Securities Exchange Act
may be exercised only after six (6) months from its grant date (unless
otherwise permitted under Rule 16b-3 of the Securities and Exchange
Commission).
(d)
The Committee shall have the discretion to
satisfy a participant’s right to receive the amount of cash determined under
subparagraph (b) hereof, in whole or in part, by the delivery of Common
Shares valued as of the date of the participant’s election.
(e)
In the event of the exercise of a Stock
Appreciation Right, the number of shares reserved for issuance hereunder shall
be reduced by the number of shares covered by the Stock Option or portion
thereof surrendered.
4
9.
Restricted Stock Awards Plan
.
Restricted
Stock Awards will consist of Common Shares transferred to participants without
other payment therefor as additional compensation for their services to the
Company or one of its subsidiaries. Restricted Stock Awards shall be
subject to such terms and conditions as the Committee determines appropriate
including, without limitation, restrictions on the sale or other disposition of
such shares and rights of the Company to reacquire such shares upon termination
of the participant’s employment within specified periods. Subject to such
other restrictions as are imposed by the Committee, the Common Shares covered
by a Restricted Stock Award granted to a participant who is subject to Section 16
of the Securities Exchange Act may be sold or otherwise disposed of only after
six (6) months from the grant date of the award (unless otherwise
permitted under Rule 16b-3 of the Securities and Exchange Commission).
10.
Performance Units Plan
(I)
Performance Units shall consist of monetary
units granted to participants which may be earned in whole or in part if the
Company achieves certain goals established by the Committee over a designated
period of time, but not in any event more than five (5) years. The goals
established by the Committee may use any of the following business criteria:
Net Income, Return on Average Assets (“ROA”), Business Unit ROA, Return on
Average Equity (“ROE”), Business Unit ROE, Return on Tangible Equity (“ROTE”),
Business Unit ROTE, Earnings Per Share (“EPS”) or Cash EPS, as defined
below. In the event the minimum corporate goal established by the
Committee is not achieved at the conclusion of a period, no amount shall be
paid to or vested in the participant. In the event the maximum corporate
goal is achieved, one hundred percent (100%) of the monetary value of the
Performance Units shall be paid to or vested in the participants, unless the
Committee in its discretion elects to reduce the amount of the payment.
Partial achievement of the maximum goal may result in a payment or vesting
corresponding to the degree of achievement. Payment of an award earned
may be in cash or in Common Shares (valued as of the date on which certificates
for such Common Shares are issued to the participant) or in a combination of
both, and may be made when earned, or vested and deferred, as the Committee in
its sole discretion determines. Deferred awards shall earn interest on
the terms and at a rate determined by the Committee. The number of shares
reserved for issuance hereunder shall be reduced by the largest whole number
obtained by dividing the monetary value of the units at the commencement of the
performance period by the Fair Market Value of a Common Share at such time,
provided that such number of shares may again become available for issuance
under this Program as is provided in paragraph 5 hereof.
(II)
Performance Stock awards are intended to
qualify as performance-based compensation for purposes of Code section
162(m). Performance Stock shall consist of common shares granted to
participants which may be vested in whole
5
or
in part if the Company achieves certain goals established by the Committee over
a designated period of time, but not in any event more than ten (10) years.
The goals established by the Committee may use any of the following business
criteria: Net Income, Return on Average Assets (“ROA”), Business Unit ROA,
Return on Average Equity (“ROE”), Business Unit ROE, Return on Tangible Equity
(“ROTE”), Business Unit ROTE, Earnings Per Share (“EPS”) or Cash EPS, as
defined below:
(a)
The term “Net Income” shall mean the Corporation’s or Business Unit’s after-tax
net income for the applicable Performance Period as reported in the Corporation’s
or Business Unit’s consolidated financial statements, adjusted to eliminate the
effect of the following: (1) in the event a significant merger or
acquisition is made effective during the Performance Period, the effect on
operations attributable to such acquisition with respect to the portion of the
Performance Period following the effective date of such merger or acquisition; (2) losses
resulting from discontinued operations; (3) extraordinary gains or losses;
(4) the cumulative effect of changes in generally accepted accounting
principles (“GAAP”); and (5) any other unusual, non-recurring gain
or loss which is separately identified and quantified in the Corporation’s or
Business Unit’s financial statements in accordance with GAAP (any reference
herein to the Corporation’s financial statements shall be deemed to include any
footnotes thereto as well as management’s discussion and analysis).
Notwithstanding the foregoing, in determining the Corporation’s Net Income for
a Performance Period the Committee may from time to time in its discretion
disregard any one or more, or all, of the foregoing adjustments (1) - (5) provided
that the effect of doing so would be to reduce the amount of incentive payable
to a Covered Executive Officer for such Performance Period.
(b)
The term “Performance Period” shall mean a calendar year, commencing January 1
and ending December 31 or such other period as designated by the Committee
which is permissible under the Code and Regulations, including but not limited
to calendar quarter(s) or multiple years.
(c)
The term “Return on Average Equity” shall mean the Net Income of the
Corporation, less dividends on preferred stock held by an unaffiliated third
party, divided by the Corporation’s Average Total Common Equity (adjusted to
eliminate net unrealized gains or losses on assets available for sale resulting
from SFAS 115) for the Performance Period.
(d)
The term “Return on Average Assets” shall mean the Net Income of the Corporation,
divided by the Corporation’s average total assets (adjusted to eliminate
unrealized gains or losses on assets available for sale resulting from SFAS
115) for the Performance Period.
(e)
The term “Business Unit ROA” means the Net Income of a business unit or
subsidiary managed by a Covered Executive Officer, divided by the business
6
unit’s
or subsidiary’s average total assets (adjusted to eliminate unrealized gains or
losses on assets available for sale resulting from SFAS 115) for the
Performance Period.
(f)
The term “Business Unit ROE” means the Net Income of a business unit or
subsidiary managed by a Covered Executive Officer, less dividends on preferred
stock held by an unaffiliated third party, divided by the business unit’s or
subsidiary’s Average Total Common Equity.
(g)
The term “Return on Tangible Equity” shall mean the Net Income of the
Corporation plus the after tax effects of amortization or other adjustments to
intangible assets other than mortgage servicing rights acquired in business
combinations, less dividends on preferred stock held by an unaffiliated third
party, divided by the Corporation’s Average Total Common Equity (adjusted
to eliminate net unrealized gains or losses on assets available for sale
resulting from SFAS 115 and intangible assets other than mortgage servicing
rights) for the Performance Period.
(h)
The term “Business Unit Return on Tangible Equity” means the Net Income of a
business unit or subsidiary managed by a Covered Executive Officer, plus the
after tax effects of amortization or other adjustments to intangible assets
other than mortgage servicing rights acquired in business combinations, less
dividends on preferred stock held by an unaffiliated third party, divided by
the Corporation’s Average Total Common Equity (adjusted to eliminate net
unrealized gains or losses on assets available for sale resulting from SFAS 115
and intangible assets other than mortgage servicing rights) for the Performance
Period.
(i)
The term “Earnings Per Share” shall mean the Net Income of the Corporation
divided by the Corporation’s weighted average common and common equivalent
shares outstanding, as determined for purposes of calculating the Corporation’s
basic or diluted (whichever the Committee shall designate at the time it
establishes the goal) earnings per share under GAAP (as adjusted to eliminate
the effect of shares issued in mergers or acquisitions identified in Sections
4.(a)(1) and (2) above where those Sections also resulted in
adjustments to Net Income) for the Performance Period.
(j)
The term “Average Total Common Equity” shall mean the common equity of the
Corporation or Business Unit, adjusted to eliminate the effect of mergers or
acquisitions completed during the Performance Period where those mergers or
acquisitions resulted in adjustments to Net Income under Sections 4.(a)(1), (2) or
(3) above.
(k)
The term “Cash Earnings per Share” shall mean Earnings per Share, as further
adjusted to eliminate the after-tax impact of the amortization and other
adjustments to goodwill and other intangible assets other than mortgage
servicing
7
rights
acquired in business combinations.
The
Committee shall establish the goal(s) for each award of Performance Units
or Performance Stock in writing on or before the last date permitted under Section 162(m) of
the Code. The Committee shall also select the employees to whom the
Performance Stock shall be awarded, who shall all be “key employees” as
determined by the Committee. The Committee shall also establish in
objective terms the method for computing the number of shares vested to the
employee if the goal is achieved.
The
maximum amount or value of an incentive compensation award for any Performance
Period to the Chief Executive Officer shall not exceed two percent (2%) of the
Corporation’s Net Income for the Performance Period, reduced by any cash
performance-based award for the same Performance Period under the TCF
Performance-Based Compensation Policy. The maximum amount or value of an
incentive compensation award for any Performance Period to any other Covered
Executive Officer shall not exceed one percent (1%) of the Corporation’s Net
Income for the Performance Period, reduced by any monetary performance unit
award for the same Performance Period under the TCF Performance-Based
Compensation Policy.
11.
Nontransferability
.
Each
Stock Option and Stock Appreciation Right granted under this Program shall not
be transferable other than by will or the laws of descent and distribution, and
shall be exercisable, during the participant’s lifetime, only by the
participant. A participant’s interest in a Performance Unit shall not be
transferable until payment or delivery of the award is made.
Notwithstanding the foregoing, the Committee may in its discretion award
Non-qualified Stock Options which are transferable at the discretion of the
participant to whom they are awarded.
12.
Other Provisions
.
The
award of any Benefit under the Program may also be subject to other provisions
(whether or not applicable to the Benefit awarded to any other participant) as
the Committee determines appropriate including, without limitation, provisions
for the purchase of Common Shares under Stock Options under the Program in
installments, provisions for the payment of the purchase price of shares under
Stock Options under the Program by delivery of other Common Shares of the
Company which have been owned for at least six months having a then market value
equal to the purchase price of such shares, restrictions on resale or other
disposition, such provisions as may be appropriate to apply with federal or
state securities laws and stock exchange requirements and understandings or
conditions as to the participant’s employment in addition to those specifically
provided for under the Program.
The
Committee may, in its discretion, permit payment of the purchase price of
shares under Stock Options under the Program by delivery of a properly executed
8
exercise
notice together with a copy of irrevocable instructions to a broker to deliver
promptly to the Company the amount of sale or loan proceeds to pay the purchase
price. To facilitate the foregoing, the Company may enter into agreements
for coordinated procedures with one or more brokerage firms.
The
Committee may, in its discretion and subject to such rules as it may
adopt, permit a participant to pay all or a portion of the federal, state and
local taxes, including FICA withholding tax, arising in connection with the
following transactions: (a) the exercise of a Non-qualified Stock
Option; (b) the lapse of restrictions on Common Shares received as a
Restricted Stock Award; or (c) the receipt or exercise of any other
Benefit; by paying cash for such amount or by electing (i) to have the
Company withhold Common Shares, (ii) to tender back Common Shares received
in connection with such Benefit or (iii) to deliver other previously
acquired Common Shares of the Company, and, in each case, having a Fair Market
Value approximately equal to the amount to be withheld.
13.
Term of Program and Amendment, Modification,
Cancellation or Acceleration of Benefits
.
No
Benefit shall be granted more than ten (10) years after April 21,
2004, the date of the approval of this Program by the stockholders; provided,
however, that the terms and conditions applicable to any Benefits granted prior
to such date may at any time be amended, modified or canceled by mutual
agreement between the Committee and the participant or such other persons as
may then have an interest therein, so long as any amendment or modification
does not increase the number of Common Shares issuable under this Program
without stockholder approval for such increase; and provided further, that the
Committee may, at any time and in its sole discretion, declare any or all Stock
Options and Stock Appreciation Rights then outstanding under this Program or
the Prior Program to be exercisable, any or all then outstanding Restricted
Stock awards (but not Performance Stock awards) to be vested, and any or all
then outstanding Performance Units to have been earned, whether or not such
options, rights, awards or units are then otherwise exercisable, vested or
earned, unless the Committee has provided otherwise in the Award Agreement
evidencing the Benefit awarded in order for the Benefit to qualify for special
treatment under Section 162(m) of the Code.
14.
No Further Awards Under Prior Program
.
No
options or other awards shall be granted under the Prior Program on or after
the date of stockholder approval of this Program.
15.
Taxes
.
The
Company shall be entitled to withhold the amount of any tax attributable to any
amount payable or shares deliverable under this Program after giving the person
entitled to receive such amount or shares notice as far in advance as
practicable, and the Company may defer making payment or delivery if any such
tax may
9
be
pending unless and until indemnified to its satisfaction. In no event shall the
Company withhold any amount for the payment of tax in excess of the minimum
statutory withholding rates for Federal and state tax purposes.
16.
Definitions
.
Fair Market Value.
The term “Fair Market Value” of
the Company’s Common Shares means as of any applicable date the average of the
high and low sales prices for the Company’s Common Shares on such date, as
reported on the New York Stock Exchange or, if no such prices shall have been
so reported on such date, on the next preceding date upon which prices are so
reported.
Subsidiary.
The term “subsidiary” for all purposes other than the
Incentive Stock Option Plan described in paragraph 6, shall mean any
corporation, partnership, joint venture or business trust, fifty percent (50%)
or more of the control of which is owned, directly or indirectly, by the
Company. For Incentive Stock Option Plan purposes the term “subsidiary”
shall be defined as provided in Section 424(f) of the Code.
Change in Control.
A “Change in Control” shall be
deemed to have occurred if:
(a)
any “person” as defined in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) is or
becomes the “beneficial owner” as defined in Rule 13d-3 under the Exchange
Act, directly or indirectly, of securities of the Company representing thirty
percent (30%) or more of the combined voting power of the Company’s then
outstanding securities. For purposes of this clause (a), the term “beneficial
owner” does not include any employee benefit plan maintained by the Company
that invests in the Company’s voting securities; or
(b)
during any period of two (2) consecutive
years (not including any period prior to the date on which the Program was
approved by the Company’s Board of Directors) there shall cease to be a
majority of the Board comprised as follows:
individuals who at the beginning of such period constitute the Board or
new directors whose nomination for election by the Company’s stockholders was
approved by a vote of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved; or
(c)
the stockholders of the Company approve a
merger or consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the
10
surviving
entity) at least 70% of the combined voting power of the voting securities of
the Company or such surviving entity outstanding immediately after such merger
or consolidation, or the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all the Company’s assets; provided, however,
that no change in control will be deemed to have occurred if such merger,
consolidation, sale or disposition of assets, or liquidation is not
subsequently consummated.
Notwithstanding
the foregoing, the Committee may provide a different definition of Change in Control
in the Award Agreement establishing the terms and conditions of any award,
provided that any such definition is not more generous to the grantee under
such Award Agreement than the foregoing definition.
Stock Options.
The term “Stock Options” shall
mean Incentive Stock Options and Non-qualified Stock Options under the Program
and, if the context includes the Prior Stock Option Programs, options granted
under the Prior Stock Option Programs.
Disability.
The term “disability” for all purposes of this Program
shall be determined by the Committee in such manner as the Committee deems
equitable or required by the applicable laws or regulations.
Retirement.
The term “retirement” for all purposes of the Program shall
be determined by the Committee in such manner as the Committee may deem
equitable or required by law.
17.
Adjustment Provisions
.
If
the Company shall at any time after approval of this Program by the
stockholders change the number of issued Common Shares without new
consideration to the Company (such as by reason of any reorganization,
recapitalization, stock split, combination or exchange of shares, merger,
consolidation or any change in the corporate
structure of TCF Financial or in the Common Shares, or in the event of
any issuance of preferred stock or other change in the capital structure of TCF
Financial which is significant for purposes of this Agreement), the total
number of shares reserved for issuance under this Program, the maximum limit on
awards to any person in any year in paragraph 4 hereof, and the number of
shares covered by each outstanding Benefit shall be automatically adjusted so
that the limitations, the aggregate consideration payable to the Company, and
the value of each such Benefit shall not be changed.
Notwithstanding
any other provision of this Program, and without affecting the number of shares
otherwise reserved or available hereunder, the Committee may authorize the
issuance or assumption of Benefits in connection with any merger,
consolidation, acquisition of property or stock, or reorganization upon such
terms and conditions as it may deem appropriate.
11
Unless
otherwise provided in the applicable Award Agreement, subject to the six month
holding requirements of paragraphs 6, 7, 8(c) and 9 but notwithstanding
any other provision of this Program or the Prior Stock Option Programs, upon
the occurrence of a Change in Control:
(a)
All Stock Options then outstanding under this
Program shall become fully exercisable as of the date of the Change in Control,
whether or not then otherwise exercisable;
(b)
All Stock Appreciation Rights then
outstanding shall become fully exercisable as of the date of the Change in
Control, whether or not then otherwise exercisable;
(c)
All terms and conditions of all Restricted
Stock Awards then outstanding shall be deemed satisfied and all such Awards
shall vest as of the date of the Change in Control; and
(d)
All Performance Units then outstanding shall
be deemed to have been fully earned as determined by the Committee and to be
immediately payable, in cash, as of the date of the Change in Control and shall
be paid within thirty (30) days thereafter and all shares of Performance Stock
then outstanding shall be fully vested and immediately distributable in the
form of shares of common stock.
18.
Amendment and Termination of Program
.
The
Committee may amend this Program from time to time or terminate this Program at
any time, but no such action shall reduce the then existing amount of any
participant’s Benefit or adversely change the terms and conditions thereof
without the participant’s consent, increase the number of authorized shares
under this Program or cause a performance-based award to fail to qualify under
Code Section 162(m). No amendment of this Program shall result in
any Committee member losing his or her status as a “disinterested person” as
defined in Rule 16b-3 of the Securities and Exchange Commission with
respect to any employee benefit plan of the Company or result in the program
losing its status as a protected plan under said Rule 16b-3.
19.
Stockholder Approval
.
The
Prior Program was adopted by the Board of Directors and approved by the
stockholders in 1995. This Program was adopted by the Board of Directors
of the Company in March 2004, effective upon obtaining stockholder
approval at the 2004 Annual Stockholders Meeting. This Program and any
Benefit granted thereunder shall be null and void if stockholder approval is
not obtained within twelve (12) months of the adoption of the Program by the
Board of Directors.
12
Exhibit 10(b)-9
TCF FINANCIAL INCENTIVE STOCK
PROGRAM
RESTRICTED STOCK AGREEMENT
RS
NO. 95-«Agr_No» (Non-deferred) (Executive Stock Award)
Shares of Restricted Stock are hereby awarded effective January
,
2008 by TCF Financial Corporation (“TCF Financial”) to «Recipient_First_Name» «MI» «Recipient_Last_Name» (the “Grantee”), subject
to the terms and conditions set forth in this Restricted Stock Agreement (the “Agreement”):
1.
Share Award
. TCF Financial hereby awards
the Grantee «M
of_Shares»
shares (the “Shares”) of Common Stock, par value $.01 per share (“Common Stock”)
of TCF Financial pursuant to the TCF Financial Incentive Stock Program (the “Program”),
upon the terms and conditions therein and hereinafter set forth. A copy of the Program as currently in effect
is incorporated herein by reference and is attached hereto as
Exhibit A
.
2.
Restrictions on Transfer; Restricted Period and
Earned Shares
.
(a)
During the period (the “Restricted Period”) described
in subparagraph 2(b), the Shares may not be sold, assigned, transferred,
pledged, or otherwise encumbered by the Grantee.
(b)
The Shares will be subject to the restrictions in
subparagraph 2(a) during the Restricted Period commencing on the date of
this Agreement (the “Commencement Date”) and (subject to the forfeiture
provisions herein) continuing until the date specified in clauses (i) and (ii) below,
on which date such restrictions will expire with respect to a percentage of the
Shares (“Earned Shares”) as follows:
(i)
Shares (50% of the Shares awarded hereunder) will no longer be subject to the restrictions
for the Restricted Period expiring on January 31, 2011, if and only if TCF
Financial achieves a return on average equity (“ROE”) of 15% or greater based
on the three-year average for fiscal years 2008, 2009 and 2010, the
determination of which shall be made by the Committee as soon as practicable
after January 1, 2011.
Notwithstanding the foregoing, any Shares under this subparagraph (b)(i) that
are not Earned Shares on January 31, 2011, shall be forfeited and returned
to TCF Financial on or about the date of the Committee’s determination that
such three-year average of ROE has not been achieved; and
(ii)
Shares (remaining 50% of the Shares awarded hereunder) will no longer be
subject to the restrictions for the Restricted Period expiring on January 31,
2012, if and only if TCF Financial achieves a return on average equity (“ROE”)
of 15% or greater based on the three-year average for fiscal years 2009, 2010
and 2011, the determination of which shall be made by the Committee as soon as
practicable
1
after January 1, 2012.
Notwithstanding the foregoing, any Shares under this subparagraph (b)(ii) that
are not Earned Shares on January 31, 2012, shall be forfeited and returned
to TCF Financial on or about the date of the Committee’s determination that
such ROE has not been achieved.
3.
Vesting
(a)
Earned Shares will vest, and no longer be subject
to the restrictions imposed by paragraph 2(a), at the expiration of the
Restricted Period with respect thereto.
The Committee referred to in section 2 of the Program or its successor
(the “Committee”) shall not have any authority to accelerate the time at which
any or all of the restrictions in paragraph 2(a) shall expire with respect
to any Shares, or to remove any or all such restrictions. However, the Committee shall have all the
authority provided in the Program with respect to performance-based compensation,
including the authority to reduce or delay the Shares vesting under this
Agreement
or the determination of the amount of
ROE growth achieved, or to otherwise reduce the compensation provided under
this Agreement in any other manner which the Committee considers appropriate in
its discretion
(b)
Termination of Service for Reasons other than
Disability, Retirement or Death
. In the event of the Grantee’s termination of
employment for any reason other than disability, retirement or death during any
Restricted Period, all Shares at the time of such event shall be forfeited and
returned to TCF Financial.
(c)
Termination of Service by Reason of Retirement,
Death or Disability
.
(i)
In the event Grantee’s retirement (as determined
by the Committee), disability, or death occurs after the date hereof but prior
to the expiration of one or both of the Restricted Periods set forth in
subparagraph 2
(b) above: (1) all
Shares will continue to be subject to the restrictions in paragraph 2(a) until
the expiration of the applicable Restricted Period as provided in subparagraphs
2(b)(i) and 2(b)(ii) at which time the Grantee shall be entitled to a
prorated portion (to be calculated in the manner set forth below) of the Earned
Shares. The prorated portion of Earned
Shares
(rounding up to the next highest whole share) shall be the sum
of: (a) the number of Earned Shares under subparagraph 2(b)(i) multiplied
by a fraction, the
numerator
of
which is the number of full calendar months the Grantee was employed by TCF Financial
from January 31, 2008 through the date of such termination; and the
denominator
of which is 36,
provided
,
however
,
this clause (a) shall apply only if the event of termination occurs on a
date prior to January 31, 2011; and (b) the number of Earned Shares
under subparagraph 2(b)(ii) multiplied by a fraction, the
numerator
of which is the number of full calendar months the
Grantee was employed by TCF Financial from January 31, 2008 through the
date of such termination; and the
denominator
of
which is 48.
(ii)
All Earned Shares in excess of Grantee’s prorated
portion, as determined in accordance with subparagraph 3(c)(i), or all unvested
Shares, as the case
2
may be, shall be forfeited and returned to TCF Financial in accordance
with subparagraphs 2(b)(i) and 2
(b)
(ii).
(iii)
For purposes of this paragraph 3(c), the Grantee’s retirement date
shall be determined by the Committee and the date Grantee became disabled shall
be the date on which the Grantee has received disability benefits under TCF’s
long-term disability plan for three months.
4.
Certificates for Shares
. TCF
Financial may issue one or more certificates in respect of the Shares in the
name of the Grantee, and shall hold such certificate(s) on deposit for the
account of the Grantee until the expiration of the Restricted Period with
respect to the Shares represented thereby.
Certificate(s) for Shares subject to a Restricted Period shall bear
the following legend:
“
The transferability of this certificate and
the shares of stock represented hereby are subject to the terms and conditions
(including forfeiture) contained in the TCF Financial Incentive Stock Program
(the “Program”) and an agreement entered into between the registered owner and
TCF Financial Corporation. Copies of
such Program and agreement are on file in the offices of the Secretary of TCF
Financial Corporation, 200 Lake Street East, Wayzata, MN 55391.
”
The
Grantee further agrees that, if certificates are issued, simultaneously with
the execution of this Agreement one or more stock powers shall be executed,
endorsed in blank and promptly delivered to TCF Financial.
If
certificates are not issued, TCF Financial shall direct the transfer agent to
issue and hold the Shares during the Restricted Period in an account where
their transferability is subject to the restrictions set forth in paragraph 2(a) of
this Agreement.
5.
Grantee’s Rights
. Except
as otherwise provided herein, Grantee, as owner of the Shares, shall have all
rights of a stockholder, including the right to vote the Shares. The Grantee hereby irrevocably and
unconditionally assigns to TCF Financial any and all cash and non-cash
dividends and other distributions paid with respect to the Shares during the
Restricted Period.
6.
Expiration of Restricted Period
. Upon the
expiration of the applicable Restricted Period with respect to the Shares, TCF
Financial shall redeliver or deliver to the Grantee (or, if the Grantee is
deceased, to his legal representative, beneficiary or heir) the certificate(s) in
respect of the number of Shares that become Earned Shares, without the
restrictive legend provided for in paragraph 4 above or re-register the number
of Shares that become Earned Shares in an account with the transfer agent which
is not subject to the restrictions set forth in paragraph 2(a) of this
Agreement.
7.
Adjustments for Changes in Capitalization of TCF
Financial
. In the event of any change in the outstanding
Common Stock of TCF Financial by reason of any reorganization,
recapitalization, stock split, combination or exchange of shares, merger,
consolidation or any change in the corporate structure of TCF Financial or in
the shares of Common Stock, or in the event of any issuance of preferred stock
or other change in the capital structure of
3
TCF Financial which the Committee deems significant for purposes of
this Agreement, the number and class of Shares covered by this Agreement as
well as the ROE vesting and forfeiture provisions in paragraphs 2 and 3, shall
be appropriately adjusted by the Committee, whose determination of the
appropriate adjustment, or whose determination that there shall be no
adjustment, shall be conclusive. Any Shares of Common Stock or other securities
received, as a result of the foregoing, by the Grantee subject to the
restrictions contained in paragraph 2(a) above also shall be subject to
such restrictions and the certificate or other instruments representing or
evidencing such Shares or securities shall be legended and deposited with TCF
Financial or otherwise restricted by the transfer agent in the manner provided
in paragraph 4 above.
8.
Effect of Merger
. In the
case of any merger, consolidation, or combination of TCF Financial with or into
another corporation or other business organization (other than a merger,
consolidation, or combination in which TCF Financial is the continuing entity
and which does not result in the outstanding shares of Common Stock being
converted into or exchanged for different securities, cash or other property,
or any combination thereof), the Committee may authorize the issuance or
assumption of Benefits (as defined in the Program) as it may deem appropriate.
9.
Effect of Change in Control
. Each of
the events specified in the following clauses (a) through (c) of this
paragraph 9 shall be deemed a “change in control” of TCF Financial (herein
referred to as the “Company”):
(a)
Any “person”, as defined in sections 13(d) and
14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) is or
becomes the “beneficial owner” as defined in Rule 13d-3 under the Exchange
Act, directly or indirectly, of securities of the Company representing fifty
percent (50%) or more of the combined voting power of the Company’s then
outstanding securities (for purposes of this clause (a), the term “beneficial
owner” does not include any employee benefit plan maintained by the Company
that invests in the Company’s voting securities); or
(b)
During any period of two (2) consecutive years
there shall cease to be a majority of the Company’s Board of Directors (the “Board”)
comprised as follows: individuals who at the beginning of such period
constitute the Board of new directors whose nomination for election by the
Company’s stockholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the beginning
of the period or whose election or nomination for election was previously so
approved; or
(c)
The stockholders of the Company approve a merger
or consolidation of the Company with any other corporation, other than a merger
or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) at least 50% of the combined voting power of the voting securities of
the Company or such surviving entity outstanding immediately after such merger
or consolidation, or the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all the
4
Company’s assets; provided, however, that no change in control will be
deemed to have occurred until such merger, consolidation, sale or disposition
of assets, or liquidation is subsequently consummated.
Subject to the six month holding requirement, if any, of Rule 16b-3
of the Securities and Exchange Commission but notwithstanding any other
provision in this Program (including, but not limited to, paragraphs 2(b) and
4 of this Agreement) in the event of a change in control of TCF Financial, all
terms and conditions of this Agreement shall be deemed satisfied, all the
Shares awarded hereunder shall vest as of the date of such change in control
and shall thereafter be administered as provided in paragraph 6 of this
Agreement.
Notwithstanding the foregoing, in the event any change in control of
TCF Financial is deemed to have occurred after the date hereof but prior to January 1,
2009, then this Agreement and all of Grantee’s rights to the Shares awarded
hereunder shall automatically terminate and be of no further force or effect.
10.
Delivery and Registration of Shares of Common
Stock
. TCF Financial’s obligation to deliver Shares
of Common Stock hereunder shall, if the Committee so requests, be conditioned
upon the receipt of a representation as to the investment intention of the Grantee
or any other person to whom such Shares are to be delivered, in such form as
the Committee shall determine to be necessary or advisable to comply with the
provisions of the Securities Act of 1933, as amended, or any other federal,
state, or local securities law or regulation.
It may be provided that any representation requirement shall become
inoperative upon a registration of such Shares or other action eliminating the
necessity of such representation under such Securities Act or other securities
law or regulation. TCF Financial shall
not be required to deliver any Shares under the Program prior to (i) the
admission of such Shares to listing on any stock exchange on which the Common
Stock may be listed, and (ii) the completion of such registration or other
qualification of such Shares under state or federal law, rule, or regulation,
as the Committee shall determine to be necessary or advisable.
11.
Program and Program Interpretations as
Controlling; Performance-Based Status.
The Shares hereby awarded and
the terms and conditions herein set forth are subject in all respects to the
terms and conditions of the Program, which are controlling. All determinations and interpretations of the
Committee shall be binding and conclusive upon the Grantee or Grantee’s legal
representatives with regard to any question arising hereunder or under the
Program. The Shares awarded hereunder
are intended to qualify as performance-based compensation under section 162(m) of
the Internal Revenue Code and under the Program, and the terms of this
Agreement shall be construed in accordance with that intent.
12.
Grantee Service
. Nothing in this Agreement
shall limit the right of TCF Financial or any of its affiliates to terminate
the Grantee’s service as a director, officer, or employee, or otherwise impose
upon TCF Financial or any of its affiliates any obligation to employ or accept
the services of the Grantee.
13.
Grantee Acceptance
. The
Grantee shall signify acceptance of the terms and conditions of this Agreement
by signing in the space provided below and signing the stock powers, as
5
required under paragraph 4 above, and returning a signed copy hereof
and of the stock powers to TCF Financial.
14.
Section 409A
of the Internal Revenue Code
. The
arrangements described in this Agreement are intended to comply with Section 409A
of the Internal Revenue Code to the extent (if any) such arrangements are
subject to that law.
15.
Non-Competition
and Non-Solicitation Obligations.
The Grantee acknowledges that Grantee is subject to certain
non-competition, non-solicitation and other obligations (the “Obligations”)
under separate contractual agreement(s) with TCF Financial or TCF National
Bank. Grantee affirms that this Agreement
and the Shares awarded hereunder constitute additional consideration for the
Obligations, which Grantee hereby re-affirms as binding and enforceable
obligations of the Grantee, and that the Shares (including Earned Shares) and
other consideration awarded hereunder may be cancelled or forfeited in the
event Grantee breaches the Obligations.
I
N WITNESS WHEREOF, the parties hereto have caused this RESTRICTED STOCK
AGREEMENT to be executed as of the date first above written.
|
|
TCF
FINANCIAL CORPORATION
|
|
|
|
|
|
By
|
|
|
|
|
Secretary
|
|
|
|
|
|
ACCEPTED:
|
|
|
|
|
|
|
|
|
|
|
|
Signature
|
|
|
|
|
|
|
|
|
|
|
|
(Street
Address)
|
|
|
|
|
|
|
|
|
|
|
|
(City,
State and Zip Code)
|
6
Exhibit 10(b)-10
TCF FINANCIAL INCENTIVE STOCK
PROGRAM
NONQUALIFIED STOCK OPTION AGREEMENT
NQO
NO.
This option is granted on
by
TCF Financial Corporation (“TCF Financial”) to
(the
“Optionee”) in accordance with the following terms and conditions:
1.
Option Grant, Vesting and Exercise Period
.
a.
TCF Financial hereby grants to the Optionee an
Option (the “Option”) to purchase, pursuant to the TCF Financial Stock
Incentive Program (the “Plan”), and upon the terms and conditions therein and
hereinafter set forth, up to but not exceeding in the aggregate
shares
(the “Option Shares”) of common stock of TCF Financial at an exercise price of
$
per
share. A copy of the Plan, as currently
in effect, is incorporated herein by reference and is attached hereto.
b.
This Option shall be exercisable only during the
period (“Exercise Period”) commencing on the date of grant of this Option and
ending at 5:00 p.m., Minneapolis, Minnesota time, on the date ten years
and one day after the date of grant of this Option, such time and date being
hereinafter referred to as the “Expiration Date.” This Option shall become exercisable (“vest”)
with respect to fifty percent (50%) of the Option Shares on January 1,
2011 and with respect to the remaining fifty percent (50%) of the Option Shares
on January 1, 2012, except as may be otherwise provided under paragraphs 5
and 9 of this Agreement. Once the Option
has vested, it may be exercised, in whole or in part, at any time and from time
to time during the remainder of the Exercise Period, provided that the total
percentage vesting under this Agreement shall never in any event exceed 100% of
the Option Shares.
2.
Method of Exercise of this Option
. To the
extent it is exercisable under subparagraph 1.b of this Agreement, this Option
may be exercised during the Exercise Period by giving written notice to TCF
Financial specifying the number of Option Shares to be purchased. The notice must be in the form prescribed by
the committee referred to in section 2 of the Plan or its successor (the “Committee”)
and directed to the address set forth in paragraph 12 below. The date of exercise is the date on which
such notice is received by TCF Financial.
Such notice must be accompanied by payment in full for the Option Shares
to be purchased upon such exercise.
Payment shall be made either (i) in cash, which may be in the form
of a check, bank draft, or money order payable to TCF Financial, or (ii) if
the Committee shall have previously approved such form of payment, by
delivering shares of Common Stock already owned by the Optionee having a “Fair
Market Value” (as defined in the Plan as in effect on the date of the grant of
this Option) on the date of exercise equal to the applicable exercise price, or
(iii) if the Committee
shall
have previously approved such form of payment, a combination of cash and
such already-owned shares or (iv) if
the Committee shall have previously approved a cashless exercise program, the
Optionee may also exercise the Option in accordance with a cashless exercise
program by electing to have withheld from shares of Common Stock otherwise
issuable to Optionee upon exercise of the Option a number of shares of Common
Stock whose “Fair Market Value” (as defined in the Plan) on the date of
exercise is equal to the applicable exercise price. Promptly after such payment, subject to
paragraph 3 below, TCF Financial shall issue and deliver to the Optionee or
other person exercising this Option a certificate or certificates representing
the shares of Common Stock so purchased, registered in the name of the Optionee
(or such other person), or, upon request, in the name of the Optionee (or other
person) and in the name of another jointly with right of survivorship.
3.
Delivery and Registration of Shares of Common
Stock
. TCF Financial’s obligation to deliver shares
of Common Stock hereunder shall, if the Committee so requests, be conditioned
upon the receipt of a representation as to the investment intention of the
Optionee or any other person to whom such shares are to be delivered, in such
form as the Committee shall determine to be necessary or advisable to comply
with the provisions of the Securities Act of 1933, as amended, or any other
Federal, state, or local securities law or regulation. In requesting any such representation, it may
be provided that such representation requirement shall become inoperative upon
a registration of such shares or other action eliminating the necessity of such
representation under such Securities Act or other securities law or
regulation. TCF Financial shall not be
required to deliver any shares upon exercise of the Option prior to (i) the
admission of such shares to listing on any stock exchange or system on which
the shares of Common Stock may then be listed, and (ii) the completion of
such registration or other qualification of such shares under any state or
Federal law, rule, or regulation, as the Committee shall determine to be
necessary or advisable.
4.
Non-transferability of this Option
. This
Option may not be assigned, encumbered, or transferred except, in the event of
the death of the Optionee, by will or the laws of descent and distribution to
the extent provided in paragraph 5 below.
This Option is exercisable during the Optionee’s lifetime only by the
Optionee. The provisions of the Option
shall be binding upon, inure to the benefit of, and be enforceable by the
parties hereto, the successors and assigns of TCF Financial, and any person to
whom this Option is transferred by will or by the laws of descent and
distribution.
5.
Termination of Service or Death of the Optionee
.
a.
Except as provided in subparagraphs b., c., or d.
of this paragraph 5 and notwithstanding any other provision of this Option to
the contrary, this Option shall not be exercisable unless the Optionee, at the
time the Optionee exercises this Option, has maintained “Continuous Service”
(as defined herein) since the date of the grant of this Option. “Continuous Service” shall mean that the
Optionee is an employee of TCF Financial or a subsidiary of TCF Financial at
all times during the period beginning on the date of the granting of this
Option and ending on a date no earlier than three months before the date of
exercise of this Option, provided that such employment status is determined
consistently with the requirements that would apply if
2
this
Option were an incentive stock option.
b.
If the Optionee shall cease to maintain
Continuous Service for any reason (excluding disability, retirement or death),
the Optionee may, but only within the period of three months immediately
following such cessation of Continuous Service and in no event after the
Expiration Date, exercise this Option to the extent the Optionee was entitled
to exercise this Option at the date of cessation. If the Optionee is terminated for cause,
however, all rights under this Option shall expire immediately upon the giving
to the Optionee of notice of such termination.
c.
In the event of termination of employment due to
retirement (as determined in the discretion of the Committee), disability or
death after the date of grant but prior to one or both of the vesting dates set
forth in subparagraph 1.b above, the Optionee may, but only within the period
of twelve months immediately following the applicable vesting date exercise a
prorated portion of this Option, which prorated portion shall be equal to the
sum of:
(1)
the number of Option Shares (rounding up to the
next highest whole share but not to exceed 50% of the Option Shares) obtained
by multiplying (a) the number of Option Shares subject to this Option that
would have vested on January 1, 2011 had such termination of employment
not occurred by (b) a fraction,
the
numerator
of which is the number of
Optionee’s full calendar months of Continuous Service from January 1, 2008
through the date of such termination; and the
denominator
of which is 36,
provided
,
however
, this clause (1) shall apply
only if the event of termination occurs on a date prior to January 1, 2011;
and
(2)
the number of Option Shares (rounding up to
the next highest whole share but not to exceed 50% of the aggregate Option
Shares)
obtained by multiplying (a) the
number of Option Shares subject to this Option that would have vested on January 1,
2012 had such termination of employment not occurred by (b) a fraction,
the
numerator
of
which is the number of Optionee’s full calendar months of Continuous Service
from January 1, 2008 through the date of such termination; and the
denominator
of which is 48.
As
to the remaining Option Shares that do not become exercisable based on the
calculations in clauses (1) and (2) above, all rights under this
Option shall expire immediately.
d.
In the event of termination of employment during
the Exercise Period due to retirement (as determined in the discretion of the
Committee), disability or death of the
Optionee while in Continuous Service of TCF Financial, the Optionee (or in the
case of death, the person to whom the Option has been transferred by will or by
the laws of descent and distribution, to the extent the Optionee was entitled
to exercise this Option immediately prior to such death) may exercise this
Option at any time within one year following such retirement, disability or
death, but in no event later than the Expiration Date. If the Optionee should die within three
months after termination of employment for any reason other than retirement or
disability, the right of the Optionee’s successor-in-interest to exercise this
Option shall terminate upon the earlier of the Expiration Date or the date
three months after the Optionee’s death.
If the Optionee should die within twelve months after termination of
employment due to retirement
3
or
disability, the right of the Optionee’s successor-in-interest to exercise this
Option shall terminate upon the later of twelve months after the date of
employment termination or three months after the Optionee’s death, but not
later than the Expiration Date. Following the death of the Optionee, the
Committee may, as an alternative means of settlement of this Option, elect to
pay to the person to whom this Option is transferred by will or by the laws of
descent and distribution the amount by which the Fair Market Value (as defined
in the Plan) of a share of Common Stock on the date of exercise of this Option
shall exceed the Exercise Price per Option Share, multiplied by the number of
Option Shares with respect to which this Option is properly exercised. Any such settlement of this Option shall be
considered an exercise of this Option for all purposes of this Option and of
the Plan.
6.
No Notice of Sale
. The
Optionee or any person to whom the Option or the Option Shares shall have been
transferred by will or by the laws of descent and distribution shall not be
required to give notice to TCF Financial in the event of the sale or other
disposition of Option Shares subsequent to exercise of the Option, except to
the extent the Optionee is required to report transactions in TCF Financial
common stock in general.
7.
Adjustments for Changes in Capitalization of TCF
Financial
. In the event of any change in the outstanding
shares of Common Stock by reason of any reorganization, recapitalization, stock
split, stock dividend, combination or exchange of shares, merger,
consolidation, or any change in the corporate structure of TCF Financial or in
the shares of Common Stock, the number and class of shares covered by this
Option and the Exercise Price shall be appropriately adjusted by the Committee,
whose determination shall be conclusive.
Notwithstanding the foregoing, the Committee shall not make any
modifications that would cause the Option to become subject to 409A of the
Internal Revenue Code.
8.
Effect of Merger
. In the
case of any merger, consolidation, or combination of TCF Financial with or into
another corporation or other business organization (other than a merger,
consolidation, or combination in which TCF Financial is the continuing entity
and which does not result in the outstanding shares of Common Stock being
converted into or exchanged for different securities, cash or other property,
or any combination thereof), the Committee may authorize the issuance or
assumption of Benefits (as defined in the Plan) as it may deem
appropriate. Notwithstanding the
foregoing, the Committee shall not make any modifications that would cause the
Option to become subject to 409A of the Internal Revenue Code.
9.
Effect of Change in Control
. Each of
the events specified in the following clauses (a) through (c) of this
paragraph 9 shall be deemed a “change in control” of TCF Financial (herein
referred to as the “Company”):
(a)
any “person” as defined in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) is or
becomes the “beneficial owner” as defined in Rule 13d-3 under the Exchange
Act, directly or indirectly, of securities of the Company representing thirty
percent (30%) or more of the combined
voting
power of the
Company’s then outstanding securities.
For purposes of this clause (a), the term “beneficial owner” does not
include any employee benefit plan maintained
4
by
the Company that invests in the Company’s voting securities; or
(b)
during any period of two (2) consecutive
years (not including any period prior to the date on which the Plan was
approved by the Company’s Board of Directors) there shall cease to be a
majority of the Company’s Board of Directors (“Board”) comprised as
follows: individuals who at the
beginning of such period constitute the Board or new directors whose nomination
for election by the Company’s stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved; or
(c)
the stockholders of the Company approve a
merger or consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) at least 70% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately
after such merger or consolidation, or the stockholders of the Company approve
a plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all the Company’s assets;
provided, however, that no change in control will be deemed to have occurred if
such merger, consolidation, sale or disposition of assets, or liquidation is
not subsequently consummated.
This
Option shall (to the extent it is not then exercisable) become exercisable in
full upon the happening of such event and shall remain so exercisable until the
Expiration Date, provided that (a) the provisions of this paragraph 9
shall not be deemed to cause this Option to be exercisable to the extent it has
previously been exercised or otherwise terminated; and (b) the provisions
of this paragraph 9 shall not cause this Option to become exercisable within
six months after the date of grant if the Optionee is then subject to the
restrictions of Section 16(b) of the Securities Exchange Act of 1934.
Notwithstanding the foregoing, in the event any change
in control of TCF Financial is deemed to have occurred after the date hereof
but prior to January 1, 2009, then this Agreement and all of the Optionee’s
rights to the Option awarded hereunder shall automatically terminate and be of
no further force or effect.
10.
Stockholder Rights not Granted by this Option
. The
Optionee is not entitled by virtue hereof to any rights of a stockholder of TCF
Financial or to notice of meetings of stockholders or to notice of any other
proceedings of TCF Financial.
11.
Withholding Tax
. Where the Optionee or another
person is entitled to receive Option Shares pursuant to the exercise of this
Option, TCF Financial shall have the right to require the Optionee or such
other person to pay to TCF Financial the amount of any taxes which TCF Financial
or any of it affiliates is required to withhold with respect to such Option
Shares, or, in lieu thereof, to retain, or sell without notice, a sufficient
number of such shares to cover
5
the
amount required to be withheld or in lieu of any of the foregoing, to withhold
or direct the withholding of a sufficient sum from the Optionee’s compensation
to satisfy such tax withholding requirements.
TCF Financial’s method of satisfying its withholding obligations shall
be solely in the discretion of TCF Financial, subject to applicable federal,
state, and local law.
12.
Notices
. All notices hereunder to TCF
Financial shall be delivered or mailed to it addressed to TCF Financial
Corporation, 200 East Lake Street, Wayzata, Minnesota 55391. Any notices hereunder to the Optionee shall
be delivered personally or mailed to the Optionee’s address noted below. Such addresses for the service of notices may
be changed at any time provided written notice of the change is furnished in
advance to TCF Financial or to the Optionee, as the case may be.
13.
Plan and Plan Interpretations as Controlling
. This
Option and the terms and conditions herein set forth are subject in all
respects to the terms and conditions of the Plan, which are controlling. All determinations and interpretations of the
Committee shall be binding and conclusive upon the Optionee or his legal
representatives with regard to any question arising hereunder or under the
Plan.
14.
Optionee Service
. Nothing in
this Option shall limit the right of TCF Financial or any of its affiliates to
terminate the Optionee’s service as a director, officer, or employee, or
otherwise impose upon TCF Financial or any of its affiliates any obligation to
employ or accept the services of the Optionee.
15.
Optionee Acceptance
. The
Optionee shall signify his or her acceptance of the terms and conditions of
this Option by signing in the space provided below and returning a signed copy
hereof to TCF Financial at the address set forth in paragraph 12 above.
16.
Non-Competition and Non-Solicitation Obligations
.
The Optionee acknowledges that Optionee is
subject to certain non-competition, non-solicitation and other obligations (the
“Obligations”) under separate contractual agreement(s) with TCF Financial
or TCF National Bank. Optionee affirms
that this Agreement and the Shares awarded hereunder constitute additional
consideration for the Obligations, which Optionee hereby re-affirms as binding
and enforceable obligations of the Optionee, and that the Options and other
consideration awarded hereunder may be cancelled or forfeited in the event
Optionee breaches the Obligations.
IN WITNESS WHEREOF, the parties hereto have caused this Option to be
executed as of the date first above written.
|
|
TCF
FINANCIAL CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By
|
|
|
|
|
|
Secretary
|
|
|
|
|
|
6
|
|
ACCEPTED
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Street
address)
|
|
|
|
|
|
|
|
|
|
|
|
(City,
State and Zip Code)
|
|
7
