This excerpt taken from the LSBK DEF 14A filed Apr 18, 2007.
Description of Article IX of the Stock Option Plan
This section describes the material provisions of Article IX of the Stock Option Plan and is qualified in its entirety by reference to the full text of Article IX, which is included at the end of this proxy statement as Appendix A.
Accelerated Vesting Upon Retirement. Currently, the Stock Option Plan provides for accelerated vesting of stock options only upon death or disability of the option holder or upon a change of control of Lake Shore Bancorp or Lake Shore Savings. Pursuant to Article IX, all options that are outstanding as of the date of an option holders retirement would, to the extent not already exercisable, automatically become fully vested and exercisable.
Discretion to Establish Vesting Schedules. Currently, the Stock Option Plan requires that options granted become exercisable no more rapidly than 20% per year beginning on the first anniversary of the grant date. Pursuant to Article IX, that requirement would apply only if no different vesting schedule is established by the committee that administers the Stock Option Plan and specified in the agreement evidencing the outstanding option. Article IX allows the committee that administers the Stock Option Plan to provide for a different vesting schedule in its discretion.
Elimination of Certain Plan Limits. Currently, the Stock Option Plan provides that options to purchase an aggregate maximum of 89,268 shares of our common stock may be granted to non-employee directors, and options to purchase a maximum of 14,878 shares of our common stock may be granted to any one non-employee director. These limits are subject to adjustment in the event of any merger, consolidation, or other business reorganization in which Lake Shore Bancorp is the surviving entity, and in the event of any stock split, stock dividend or other event generally affecting the number of shares of common stock held by record holders. Article IX would do away with these limits.