SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. __)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
RIDGESTONE FINANCIAL SERVICES, INC.
(Name of Registrant as Specified in its Charter)
RIDGESTONE FINANCIAL SERVICES, INC.
(Name of person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
RIDGESTONE FINANCIAL SERVICES, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 22, 1997
To the Shareholders of
Ridgestone Financial Services, Inc.:
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders
of Ridgestone Financial Services, Inc. (the "Company") will be held on
Tuesday, April 22, 1997, at 10:00 A.M., local time, at the Westmoor
Country Club, 400 South Moorland Road, Brookfield, Wisconsin 53005, for
the following purposes:
1. To elect twelve directors to hold office until the 1998
annual meeting of shareholders and until their successors are duly elected
and qualified.
2. To consider a proposal to approve the Ridgestone Financial
Services, Inc. 1996 Stock Option Plan.
3. To consider and act upon such other business as may
properly come before the meeting or any adjournment or postponement
thereof.
The close of business on March 3, 1997 has been fixed as the
record date for the determination of shareholders entitled to notice of,
and to vote at, the meeting and any adjournment or postponement thereof.
A proxy for the meeting and a proxy statement are enclosed
herewith.
By Order of the Board of Directors
RIDGESTONE FINANCIAL SERVICES, INC.
Christine V. Lake
Vice President and Secretary
Brookfield, Wisconsin
March 21, 1997
YOUR VOTE IS IMPORTANT NO MATTER HOW LARGE OR SMALL YOUR HOLDINGS MAY BE.
TO ASSURE YOUR REPRESENTATION AT THE MEETING, PLEASE SIGN AND DATE THE
ENCLOSED PROXY, WHICH IS SOLICITED BY THE BOARD OF DIRECTORS, SIGN EXACTLY
AS YOUR NAME APPEARS THEREON AND RETURN IMMEDIATELY.
<PAGE>
RIDGESTONE FINANCIAL SERVICES, INC.
13925 West North Avenue
Brookfield, Wisconsin 53005
PROXY STATEMENT
For
ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 22, 1997
This proxy statement is being furnished to shareholders by the
Board of Directors (the "Board") of Ridgestone Financial Services, Inc.
(the "Company") beginning on or about March 21, 1997 in connection with a
solicitation of proxies by the Board for use at the Company's annual
meeting of shareholders to be held on Tuesday, April 22, 1997, at
10:00 A.M., local time, at the Westmoor Country Club, 400 South Moorland
Road, Brookfield, Wisconsin 53005, and all adjournments or postponements
thereof (the "Annual Meeting"), for the purposes set forth in the attached
Notice of Annual Meeting of Shareholders.
Execution of a proxy given in response to this solicitation will
not affect a shareholder's right to attend the Annual Meeting and to vote
in person. Presence at the Annual Meeting of a shareholder who has signed
a proxy does not in itself revoke a proxy. Any shareholder giving a proxy
may revoke it at any time before it is exercised by giving notice thereof
to the Company in writing or in open meeting.
A proxy, in the enclosed form, which is properly executed,
returned to the Company and not revoked will be voted in accordance with
the instructions contained therein. The shares represented by executed
but unmarked proxies will be voted FOR the twelve persons nominated for
election as directors referred to herein, FOR the approval of the
Ridgestone Financial Services, Inc. 1996 Stock Option Plan (the "1996
Plan"), and on such other business or matters that may properly come
before the Annual Meeting in accordance with the best judgment of the
persons named as proxies in the enclosed form of proxy. Other than the
election of directors and the approval of the 1996 Plan, the Board has no
knowledge of any matters to be presented for action by the shareholders at
the Annual Meeting.
Only holders of record of the Company's common stock, no par
value (the "Common Stock"), at the close of business on March 3, 1997 are
entitled to vote at the Annual Meeting. On that date, the Company had
outstanding and entitled to vote 834,340 shares of Common Stock, each of
which is entitled to one vote per share.
The Company, which commenced operations in 1995, is the holding
company for Ridgestone Bank (the "Bank").
ELECTION OF DIRECTORS
At the Annual Meeting, the shareholders will elect twelve
directors to hold office until the 1998 annual meeting of shareholders and
until their successors are duly elected and qualified. Unless
shareholders otherwise specify, the shares represented by the proxies
received will be voted in favor of the election as directors of the twelve
persons named as nominees herein. The Board has no reason to believe that
any of the listed nominees will be unable or unwilling to serve as a
director if elected. However, in the event that any nominee should be
unable to serve or for good cause will not serve, the shares represented
by proxies received will be voted for another nominee selected by the
Board.
Directors will be elected by a plurality of the votes cast at
the Annual Meeting (assuming a quorum is present). An abstention from
voting will be tabulated as a vote withheld on the election and will be
included in computing the number of shares present for purposes of
determining the presence of a quorum, but will not be considered in
determining whether each of the nominees has received a plurality of the
votes cast at the Annual Meeting. A broker or nominee holding shares
registered in its name, or the name of its nominee, which are beneficially
owned by another person and for which it has not received instructions as
to voting from the beneficial owner, has the discretion to vote the
beneficial owner's shares with respect to the election of directors.
The following sets forth certain information, as of March 1,
1997, about all of the Board's nominees for election at the Annual
Meeting. All current directors of the Company also serve as directors of
the Bank.
Nominees for Election at the Annual Meeting
Paul E. Menzel, 59, has been President and Chief Executive
Officer of the Company and the Bank since 1995. For ten years prior
thereto, Mr. Menzel was President and a director of M&I Wauwatosa State
Bank, Wauwatosa, Wisconsin. Mr. Menzel has been a director of the Company
since 1995.
William R. Hayes, 52, has been a Vice President and Treasurer of
the Company and Vice President, Cashier/Controller of the Bank since 1995.
From 1988 to 1994, Mr. Hayes was employed as Vice President, Cashier and
Controller of M&I Wauwatosa State Bank, with responsibility for bank
operations, financial reporting, human resources and regulatory
compliance. Mr. Hayes has been a director of the Company since 1995.
Christine V. Lake, 44, has been a Vice President of the Company
since 1995, Secretary of the Company since January 1996 and Executive Vice
President of the Bank since February 1996. Ms. Lake served as Vice
President of M&I Wauwatosa State Bank from 1991 to 1994 with
responsibilities for management of the Consumer Banking Division. From
1994 to 1995, Ms. Lake was a Vice President of M&I Marshall & Ilsley Bank
in Retail Administration. Ms. Lake has been a director of the Company
since 1996.
Charles N. Ackley, 66, has been owner of C.N.A. Associates,
Inc., a company engaged in sales representation of manufacturers, since
1992. He was President of Ackley-Dornbach, Inc. from 1962 to 1992 and
President of A.D.G. Erectors, Inc. from 1972 to 1987. Mr. Ackley has been
a director of the Company since 1995.
Gregory J. Hoesly, 40, has been President of L.L. Richards
Machinery Co., Inc., a Butler, Wisconsin machine tool dealer, since 1992
and has been employed by such company since 1984. He is a member of the
American Machine Tool Distributors Association, the Machinery Dealers
National Association, the Association of Machinery and Equipment
Appraisers and the Butler Area Chamber of Commerce. Mr. Hoesly has been a
director of the Company since 1996.
John E. Horning, 59, is Chairman of the Board and Chief
Executive Officer of Wauwatosa Realty Company, Wisconsin Mortgage
Corporation and Heritage Title Service, all located in Wauwatosa,
Wisconsin. He has been employed by Wauwatosa Realty since 1950. He is a
member of the national, state and Metropolitan Milwaukee Boards of
Realtors. Mr. Horning has been a director of the Company since 1995.
William F. Krause, Jr., 59, has been President since 1994 and
was Vice President from 1962 to 1994 of Krause Funeral Home, Inc., a
multi-location funeral service provider based in Milwaukee, Wisconsin. He
is a member of the National and Wisconsin Funeral Directors Associations.
Mr. Krause has been a director of the Company since 1996.
Charles G. Niebler, 52, has been President of Eye Care Vision
Centers, a multi-location optometry practice based in Brookfield,
Wisconsin, since 1970. He is a member of the Milwaukee Optometric Society
and the American and Wisconsin Optometric Associations. Dr. Niebler has
been a director of the Company since 1996.
Frederick I. Olson, 81, was a Professor of History at the
University of Wisconsin-Milwaukee until his retirement in 1985. He also
served as Associate Dean of the University's College of Letters.
Professor Olson has been a director of the Company since 1995.
James E. Renner, 58, owns Renner Oldsmobile and Renner
Mitsubishi in Wauwatosa, Wisconsin. He became associated with the
Oldsmobile dealership in 1958, and acquired the Mitsubishi dealership in
1993. Mr. Renner is a member of the Automobile Dealers of Mega Milwaukee,
Inc. and the National Automobile Dealers Association. Mr. Renner has been
a director of the Company since 1995.
Richard A. Streff, 65, has been Chairman of the Board of Streff
Advertising, Inc. of Wauwatosa, Wisconsin since 1960. He is a member of
the Promotional Products Association of America. Mr. Streff has been a
director of the Company since 1995.
William J. Tetzlaff, 65, has been President of Tetzlaff
Associates, Inc., a consulting services company in Wauwatosa, Wisconsin,
since 1991, President of Advanced Plastics Technology, Inc., a
distribution company located in Wauwatosa, Wisconsin, since 1992 and Vice
President of Executive Travel Services, Ltd., a travel agency located in
Wauwatosa, Wisconsin, since 1995. Mr. Tetzlaff is a member of the
Wauwatosa Chamber of Commerce. Mr. Tetzlaff has been a director of the
Company since 1995.
THE BOARD RECOMMENDS THE FOREGOING NOMINEES FOR ELECTION AS
DIRECTORS AND URGES EACH SHAREHOLDER TO VOTE "FOR" EACH NOMINEE. UNLESS
MARKED TO THE CONTRARY, THE SHARES REPRESENTED BY PROPERLY EXECUTED
PROXIES RECEIVED PRIOR TO, OR AT THE ANNUAL MEETING, AND NOT REVOKED, WILL
BE VOTED "FOR" EACH NOMINEE.
BOARD OF DIRECTORS
General
The Board has standing Audit and Personnel Committees. The
functions of the Audit Committee are to recommend to the Board the
appointment of independent auditors, review the independence of the
auditors, approve the scope of the annual audit, approve the audit fee
payable to the auditors and review the audit results. Messrs. Horning,
Olson and Renner are members of the Audit Committee. The Audit Committee
did not meet during 1996.
The Personnel Committee of the Board is responsible for
administering the 1996 Plan, which is subject to shareholder approval at
the Annual Meeting. See "Approval of the 1996 Plan." The members of the
Personnel Committee, which met once in 1996, are Messrs. Krause, Renner
and Streff. Beyond administering the 1996 Plan, the Personnel Committee
of the Board does not consider any other matters regarding compensation
since such compensation is currently paid only at the Bank level and not
at the Company level. The Personnel Committee of the Board of Directors
of the Bank reviews and recommends to the Bank Board the compensation
structure for the directors, officers and other managerial personnel of
the Bank, including salary rates, fringe benefits, non-cash perquisites
and other forms of compensation. The Personnel Committee of the Board of
Directors of the Bank, which met twice in 1996, consists of Messrs.
Krause, Renner and Streff.
The Board does not have a standing nominating committee. The
Board will consider nominations for directors made by shareholders
provided such nominations are made in writing, contain certain information
specified in the Company's bylaws and are delivered to the President of
the Company no less than 14 days or more than 50 days prior to any meeting
of shareholders called for the election of directors.
The Board held six meetings during the fiscal year ended
December 31, 1996. During fiscal 1996, each director of the Company
attended at least 75% of the aggregate of (a) the total number of meetings
of the Board and (b) the total number of meetings held by all committees
of the Board on which such director served during the year, except Messrs.
Horning, Niebler and Olson.
Director Compensation
The Company currently does not pay any compensation to its
directors. Directors of the Bank receive a fee of $250 per meeting
attended as well as a fee of $50 per committee meeting attended. Employee
directors of the Bank are not entitled to receive the committee meeting
fee.
EXECUTIVE OFFICERS
Paul E. Menzel, the Company's President and Chief Executive
Officer, William R. Hayes, the Company's Vice President and Treasurer, and
Christine V. Lake, the Company's Vice President and Secretary, are the
only executive officers of the Company. Certain information regarding the
executive officers is set forth under the caption "Election of Directors."
The executive officers of the Company serve at the pleasure of the Board.
PRINCIPAL SHAREHOLDERS
The following table sets forth information, as of March 3, 1997,
regarding beneficial ownership of Common Stock by each director and
nominee, the Company's Chief Executive Officer, and all of the directors,
nominees and executive officers of the Company as a group. As of the date
of this Proxy Statement, the Company was not aware of any shareholder who
beneficially owned in excess of 5% of the outstanding shares of Common
Stock.
Number of
Shares Percent
Beneficially of
Name of Beneficial Owner(1) Owned Class
Charles N. Ackley 10,000 1.2%
William R. Hayes 7,500 *
Gregory J. Hoesly 5,500(2) *
John E. Horning 2,500 *
William F. Krause, Jr. 12,500(3) 1.5
Christine V. Lake 7,500(4) *
Paul E. Menzel 30,600(5) 3.7
Charles G. Niebler 9,000(6) 1.1
Frederick I. Olson 3,000 *
James E. Renner 7,000(7) *
Richard A. Streff 5,000(8) *
William J. Tetzlaff 2,500 *
Directors, nominees and executive officers
of the Company as a group (12 persons) 102,600 12.3%
_______________
* Less than one percent (1%).
(1) The address of each of the persons named in the table is 13925 West
North Avenue, Brookfield, Wisconsin 53005.
(2) Includes 5,000 shares held by River Parkway Partnership, of which
Mr. Hoesly is a Partner.
(3) Includes 10,000 shares held by the Krause Funeral Home, Inc.
Employees Profit Sharing Plan, of which Mr. Krause is a trustee.
(4) Includes 2,000 shares held by Ms. Lake's spouse.
(5) Includes 2,623 shares held by Mr. Menzel's spouse and 2,700 shares
held by Mr. Menzel's children.
(6) Includes 1,380 shares held by Dr. Niebler's spouse.
(7) Includes 2,000 shares held by Mr. Renner's children.
(8) Includes 1,000 shares held by Mr. Streff's spouse and 1,000 shares
held by Streff Advertising, Inc.
EXECUTIVE COMPENSATION
Summary Compensation Information
The following table sets forth certain information concerning
compensation paid in 1996 to Mr. Menzel, the Company's Chief Executive
Officer. From the inception of the Company and the Bank, the executive
officers have been compensated at levels below those at which they were
compensated in their prior positions. Their intent in accepting such
compensation has been to achieve earlier profitability for the Company and
the Bank by reducing operating expenses. Consistent with this position,
Mr. Menzel received no cash compensation during fiscal 1995 and did not
receive any cash compensation for service as an executive officer in
fiscal 1996 until September 1, 1996. No executive officer of the Company
or the Bank received in excess of $100,000 in cash compensation during
fiscal 1996.
Summary Compensation Table
Long Term
Compensation
Annual
Compensation Awards
Securities
Underlying All
Name and Principal Salary Bonus Stock other
Position Year ($) ($) Options(#) compensation
Paul E. Menzel .. 1996 $28,156(1) 0 25,000 $3,123(2)
President 1995 0 0 0
______________
(1) Includes $3,000 in directors fees and $56 in life insurance
premiums paid by the Bank.
(2) Consists of a car allowance.
Stock Options
The Company has in effect the 1996 Plan pursuant to which options to
purchase Common Stock may be granted to employees (including officers) of
the Company and its subsidiaries. The following table presents certain
information about grants of stock options made during fiscal 1996 to Mr.
Menzel. The 1996 Plan is subject to approval at the Annual Meeting and
all options granted thereunder are subject to receipt of such approval.
Option Grants in 1996 Fiscal Year
Individual Grants
Percent of
Number of Total
Securities Options Exercise
Underlying Granted to or Base
Options Employees in Price Expiration
Name Granted(#)(1) Fiscal Year ($/Share) Date
Paul E. Menzel 25,000 51.0% $11.75 July 16, 2006
________________
(1) The options reflected in the table (which are nonstatutory options
for purposes of the Internal Revenue Code of 1986, as amended (the
"Code")) were granted on July 16, 1996, subject to approval of the
1996 Plan by shareholders at the Annual Meeting. One-third of the
options will vest and become exercisable on the first anniversary
of grant, an additional one-third of the options will vest and
become exercisable on the second anniversary of grant and the final
one-third of the option will vest and become exercisable on the
third anniversary of grant.
The following table sets forth information regarding the fiscal
year-end value of unexercised options held by Mr. Menzel. No options were
exercised by Mr. Menzel in 1996.
Fiscal Year-End Option Values
Number of Securities
Underlying Unexercised Value of Unexercised
Options at Fiscal In-the-Money Options
Year-End (#) at Fiscal Year End ($)(1)
Name Exercisable Unexercisable Exercisable Unexercisable
Paul E. Menzel .. 0 25,000 0 $31,250
______________
(1) The dollar value is calculated by determining the difference
between the fair market value of the underlying Common Stock and
the exercise price of the option at fiscal year-end.
Employment Agreement
The Bank has entered into an employment agreement with Mr.
Menzel for a two-year term beginning December 31, 1996. The agreement
provides that the term will be automatically extended on December 31 of
each year for an additional year, unless at least 60 days before such
renewal date the Bank or Mr. Menzel gives notice that the term will not be
extended beyond the then current expiration date. The agreement further
provides that Mr. Menzel will be paid a base salary and such bonuses as
may from time to time be determined by the Board of Directors of the Bank.
The agreement provides that Mr. Menzel's base salary (exclusive of bonus)
will not be less than his salary (exclusive of bonus) in effect on the
date of the agreement and may not be reduced at any time after any
increase is approved by the Board of Directors of the Bank. The agreement
will terminate upon Mr. Menzel's death or disability, for cause, or upon
voluntary termination by Mr. Menzel.
If Mr. Menzel resigns or is terminated following a "change in
control" (as defined below), Mr. Menzel will be entitled to a lump sum
severance payment equal to two times the sum of (i) his then current
salary and (ii) his average bonus over the two years preceding
termination. Alternatively, Mr. Menzel may elect to receive his severence
payment in installments over a period of two years commencing on the
termination date. The agreement defines a "change in control" as any of
the following, whether in a single transaction or in a series of
transactions: (i) the acquisition by any person or group of 25% or more
of the voting power of the Company or the Bank; (ii) the combination of
the Company or Bank with any entity after which less than 75% of the
outstanding securities of the surviving entity are owned by former
shareholders of the Company; or (iii) the sale, lease or other transfer by
either the Company or the Bank of all or substantially all of its
respective properties or assets other than in the ordinary course of
business. In addition, if Mr. Menzel is terminated by the Bank "in
contemplation of" a change of control, or is terminated by the Bank (or
other surviving entity) during the twelve-month period after a change of
control, such termination will be deemed to be a change of control for
purposes of the agreement. The agreement also provides that if Mr. Menzel
is terminated by the Bank during the three-month period prior to the
announcement of a change of control, such termination will be deemed to be
a termination "in contemplation of" a change of control.
If any of the following events occur after a change in control
without Mr. Menzel's written consent, then Mr. Menzel may terminate his
employment by giving at least 90 days' prior written notice: Mr. Menzel
is assigned to positions, duties or responsibilities that are less
significant than his positions, duties and responsibilities at the
commencement of the employment term; Mr. Menzel is removed from or is not
re-elected to any of his positions (subject to certain exceptions); Mr.
Menzel's base salary or relative bonus is reduced; Mr. Menzel is
transferred to a location more than 35 miles from Brookfield, Wisconsin;
or in the event of a change of control of the Company in which the Company
is not the surviving entity, the surviving entity fails to execute an
employment agreement in substantially the same form as Mr. Menzel's
current employment agreement. If Mr. Menzel terminates his employment in
such a situation, then he will be entitled to the same severance payment
as if he had been terminated following a change in control.
For the two years following termination, Mr. Menzel will also be
entitled to receive all other benefits, including retirement benefits and
deferred compensation, to which he would have been entitled had he
remained employed by the Bank. If Mr. Menzel's employment with the Bank
is terminated before Mr. Menzel's 60th birthday, Mr. Menzel generally must
take reasonable steps to obtain substantially similar employment and
thereby mitigate the amount of compensation and benefits payable to him by
the Bank.
APPROVAL OF THE 1996 PLAN
General
The purpose of the 1996 Plan is to promote the best interests of
the Company and its shareholders by providing key employees of the Company
and its affiliates with an opportunity to acquire a proprietary interest
in the Company. The 1996 Plan is intended to promote continuity of
management and to provide increased incentive and personal interest in the
welfare of the Company by those key employees who are primarily
responsible for shaping and carrying out the long-range plans of the
Company and securing the Company's continued growth and financial success.
The 1996 Plan was adopted by the Board on July 16, 1996. The
1996 Plan became effective on that date subject to shareholder approval
within twelve months following the Board's adoption of the 1996 Plan.
The following summary description of the 1996 Plan is qualified
in its entirety by reference to the full text of the 1996 Plan which is
attached to this Proxy Statement as Appendix A.
Administration and Eligibility
The 1996 Plan is required to be administered by a committee of
the Board (the "Committee") consisting of no less than two directors who
are "nonemployee directors" within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and who
are "outside directors" within the meaning of Section 162(m) of the Code.
In the event that the Committee is not appointed, the functions of the
Committee will be exercised by those members of the Board who qualify as
"nonemployee directors" under Rule 16b-3 and as "outside directors" within
the meaning of Section 162(m). The Personnel Committee of the Board has
been designated as the current administrator of the 1996 Plan. Among
other functions, the Committee has the authority to establish rules for
the administration of the 1996 Plan; to select the key employees of the
Company and its affiliates to whom stock options will be granted; to
determine the number of shares of Common Stock subject to the options to
be granted to key employees; and to set the terms and conditions of such
stock options. Subject to the express terms of the 1996 Plan,
determinations and interpretations with respect thereto will be in the
sole discretion of the Committee, whose determinations and interpretations
will be binding on all parties.
Any key employee of the Company or any affiliate, including any
executive officer or employee-director of the Company who is not a member
of the Committee, is eligible to be granted awards by the Committee under
the 1996 Plan. Currently, approximately 18 employees are eligible to
participate in the 1996 Plan. The number of eligible employees may
increase over time based upon future growth of the Company.
Awards Under the 1996 Plan; Available Shares
The 1996 Plan authorizes the granting to key employees of stock
options, which may be either incentive stock options meeting the
requirements of Section 422 of the Code ("ISOs") or non-qualified stock
options. The 1996 Plan provides that up to a total of 100,000 shares of
Common Stock (subject to adjustment as described below) will be available
for the granting of options thereunder.
If any shares subject to options granted under the 1996 Plan, or
to which any option relates, are forfeited, or if an option otherwise
terminates, expires or is canceled prior to the delivery of all of the
shares or other consideration issuable or payable pursuant to the option,
such shares will be available for the granting of new options under the
1996 Plan. Any shares delivered pursuant to exercise of an option granted
under the 1996 Plan may be either authorized and unissued shares of Common
Stock or treasury shares held by the Company.
Stock Option Awards
During any one calendar year, no individual key employee may be
granted options to purchase in excess of 25,000 shares of Common Stock
under the 1996 Plan (subject to adjustment as described below).
The exercise price per share of Common Stock subject to options
granted to key employees under the 1996 Plan will be determined by the
Committee, provided that the exercise price may not be less than 100% of
the fair market value of a share of Common Stock on the date of grant.
The term of any option granted to a key employee under the 1996 Plan will
be as determined by the Committee, provided that no stock option may have
a term which exceeds ten years from the date of its grant. Options
granted to key employees under the 1996 Plan will become exercisable in
such manner and within such period or periods and in such installments or
otherwise as determined by the Committee. Options may be exercised by
payment in full of the exercise price, either (at the discretion of the
Committee) in cash or (in whole or in part) by tendering shares of Common
Stock or other consideration having a fair market value on the date of
exercise equal to the option exercise price. Pursuant to the terms of the
1996 Plan, no ISO may be granted thereunder after July 16, 2006. All ISOs
granted under the 1996 Plan will also be required to comply with all other
terms of Section 422 of the Code.
Adjustments
If any dividend or other distribution, recapitalization, stock
split, reverse stock split, reorganization, merger, consolidation, split-
up, spin-off, combination, repurchase, or exchange of shares of Common
Stock or other securities of the Company, issuance of warrants or other
rights to purchase shares of Common Stock or other securities of the
Company, or other similar corporate transaction or event affects the
shares of Common Stock so that an adjustment is appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the 1996 Plan, then the Committee will
generally have the authority to, in such manner as it deems equitable,
adjust (a) the number and type of shares subject to the 1996 Plan and
which thereafter may be made the subject of options, (b) the number and
type of shares subject to outstanding options, and (c) the exercise price
with respect to any option, or may make provision for a cash payment to
the holder of an outstanding option.
Limits on Transferability
Except as otherwise provided by the Committee, no option granted
under the 1996 Plan may be assigned, sold, transferred or encumbered by
any participant, otherwise than by will, by designation of a beneficiary,
or by the laws of descent and distribution. Except as otherwise provided
by the Committee, each option will be exercisable during the participant's
lifetime only by such participant or, if permissible under applicable law,
by the participant's guardian or legal representative.
Amendment and Termination
The Board may amend, suspend or terminate the 1996 Plan at any
time, except that no such action may adversely affect any option granted
and then outstanding thereunder without the approval of the respective
participant. The 1996 Plan further provides that shareholder approval of
any amendment thereto must also be obtained if required by (a) the Code or
any rules promulgated thereunder (to allow for ISOs to be granted
thereunder), (b) any other applicable law or (c) the quotation or listing
requirements of the exchange or market on which the Common Stock is then
traded (in order to maintain the trading of the Common Stock on such
exchange or market).
Withholding
Not later than the date as of which an amount first becomes
includible in the gross income of a key employee for federal income tax
purposes with respect to any option granted under the 1996 Plan, the key
employee will be required to pay to the Company, or make arrangements
satisfactory to the Company regarding the payment of, any federal, state,
local or foreign taxes of any kind required by law to be withheld with
respect to such amount. Unless otherwise determined by the Committee,
withholding obligations arising with respect to options granted under the
1996 Plan may be settled with shares of Common Stock, including shares of
Common Stock that are received upon exercise of the option that gives rise
to the withholding requirement. The obligations of the Company under the
1996 Plan are conditional on such payment or arrangements, and the Company
and any affiliate will, to the extent permitted by law, have the right to
deduct any such taxes from any payment otherwise due to the key employee.
The Committee may establish such procedures as it deems appropriate for
the settling of withholding obligations with shares of Common Stock.
Certain Federal Income Tax Consequences
The grant of an option under the 1996 Plan will create no income
tax consequences to the key employee. A key employee who is granted a
non-qualified stock option will generally recognize ordinary income at the
time of exercise in an amount equal to the excess of the fair market value
of the Common Stock acquired at such time over the exercise price. The
Company will be entitled to a deduction in the same amount and at the same
time as ordinary income is recognized by the key employee. A subsequent
disposition of the Common Stock will give rise to capital gain or loss to
the extent the amount realized from the sale differs from the tax basis,
i.e, the fair market value of the Common Stock on the date of exercise.
This capital gain or loss will be a long-term capital gain or loss if the
Common Stock has been held for more than one year from the date of
exercise.
In general, a key employee will recognize no income or gain as a
result of exercise of an ISO (except that the alternative minimum tax may
apply). Except as described below, any gain or loss realized by the key
employee on the disposition of the Common Stock acquired pursuant to the
exercise of an ISO will be treated as a long-term capital gain or loss and
no deduction will be allowed to the Company. If the key employee fails to
hold the shares of Common Stock acquired pursuant to the exercise of an
ISO for a least two years from the date of grant of the ISO and one year
from the date of exercise, the key employee will recognize ordinary income
at the time of the disposition equal to the lesser of (a) the gain
realized on the disposition, or (b) the excess of the fair market value of
the shares of Common Stock acquired on the date of exercise over the
exercise price. The Company will be entitled to a deduction in the same
amount and at the same time as ordinary income is recognized by the key
employee. Any additional gain realized by the key employee over the fair
market value at the time of exercise will be treated as a capital gain.
This capital gain will be a long-term capital gain if the Common Stock has
been held for more than one year from the date of exercise.
Awards under the 1996 Plan
The following table sets forth information with respect to
option grants that have been made to Mr. Menzel under the 1996 Plan during
fiscal 1996. All of such options were granted contingent upon shareholder
approval of the 1996 Plan at the Annual Meeting. The options are non-
qualified options and will vest and become exercisable ratably over a
three-year period from the date of grant. The options granted to Mr.
Menzel have per share exercise prices of $11.75. Any future option grants
will be made at the direction of the Committee.
New Plan Benefits
Ridgestone Financial Services, Inc.
1996 Stock Option Plan
Number of Shares
Name and Position Subject to Options
Paul E. Menzel, President and 25,000
Chief Executive Officer
Executive Group 40,000
Non-Executive Officer Employee Group 9,025
The last reported price per share of the Common Stock on
March 3, 1997 was $13.50.
Vote Required
The affirmative vote of the holders of a majority of the shares
of Common Stock represented and voted at the Annual Meeting with respect
to the 1996 Plan (assuming a quorum is present) is required to approve the
1996 Plan. Any shares of Common Stock not voted at the Annual Meeting
with respect to the 1996 Plan (whether as a result of broker non-votes or
otherwise, except abstentions) will have no impact on the vote. Shares of
Common Stock as to which holders abstain from voting will be treated as
votes against the 1996 Plan.
THE BOARD RECOMMENDS A VOTE "FOR" THE 1996 PLAN AND URGES EACH SHAREHOLDER
TO VOTE FOR THE 1996 PLAN. UNLESS MARKED TO THE CONTRARY, THE SHARES
REPRESENTED BY PROPERLY EXECUTED PROXIES RECEIVED PRIOR TO, OR AT THE
ANNUAL MEETING, AND NOT REVOKED, WILL BE VOTED "FOR" THE 1996 PLAN.
CERTAIN TRANSACTIONS
Organizational Matters
During 1995, the organizers of the Bank (Messrs. Ackley,
Thomas C. Birdsall, Hayes, Horning, Curtis Lang, Menzel, Niebler, Olson,
Peterman, Renner, Streff and Tetzlaff) loaned an aggregate of $36,000 to
the Company to cover organizational expenses of the Bank and the Company.
Interest was payable on these loans at an annual interest rate of 10%.
Mr. Menzel also made loans to the Company under two separate lines of
credit of $150,000 and $100,000, respectively, to fund salaries and other
administrative expenses of the Company and the Bank during their
organization. Each line of credit bore interest at a variable rate (8.75%
initially) and matured on December 6, 1995. The loans Mr. Menzel entered
into to fund his loans to the Company were subject to certain limited
guarantees provided by the organizers. All of the foregoing loans were
repaid out of the net proceeds of the Company's November 1995 initial
public offering.
Mr. Birdsall, an organizer of the Bank engaged in the business
of commercial and industrial real estate brokerage, was paid a broker's
commission of approximately $10,400, which was equal to one-half of the 6%
commission paid on the five-year lease covering the Bank premises, and is
entitled to additional commissions if the Company exercises its options
for further five-year lease terms and if the Company later purchases the
shopping mall in which the Bank premises are located. The other half of
this commission was paid to Birdsall-Horning & Associates, Inc., a wholly-
owned subsidiary of Wauwatosa Realty Company, of which Mr. Horning, a
director of the Company and the Bank, is both Chairman of the Board and a
principal shareholder. Mr. Birdsall is Vice President of Birdsall-
Horning & Associates, Inc. The broker's commission was determined by a
majority of the independent outside directors of the Company to be on
terms no less favorable to the Company than those that are generally
available from unaffiliated third parties. The payment of the commission
was ratified by a majority of the independent outside directors who do not
have an interest in the transaction other than in their capacity as
directors of the Company.
Banking Transactions
The Bank has adopted a policy pursuant to which it will make
loans to eligible directors, executive officers, and members of their
immediate families for the financing of their personal residences and for
consumer or business purposes. Under the Bank's policy, all such loans
will be made in the ordinary course of business and on substantially the
same terms and conditions (including interest rates and collateral) as
those of comparable transactions prevailing at the time, and will not
involve more than the normal risk of collectibility or present other
unfavorable features.
Set forth below is certain information about the only loans made
by the Bank to a director, nominee for election as a director, executive
officer or member of their immediate families, whose aggregate
indebtedness to the Bank exceeded $60,000 at any time since the Company's
inception. Such loans were made in accordance with the Bank's policy as
described above.
Largest Balance
Amount as of
Name Date Type Outstanding December
of of of Since 31, Interest
Borrower Loan Loan Inception 1996 Rate
Charles October Commercial $94,500 $94,146 Prime
Niebler 23, 1996 Loan
(1)
James October Construc- $50,000(3) $50,000 7.50%
Krause(2) 16, 1996 tion Loan
David August Residen- $111,920 $111,717 8.25%
Niebler 16, 1996 tial
(4) Mortgage
Charles August Home $0(6) $0 Prime
Niebler 13, 1996 Equity Line
(5)
Christopher August 2, Residential $100,000 0 7.75%
Grow(7) 1996 Mortgage
James July 3, Home $92,819 $92,819 Prime
Krause(2) 1996 Equity
Line
JDW Realty April 24, Commercial $1,176,485 $1,002,104 8.0
Company 1996 Mortgage to
(8) 8.25%
River December Business $280,000(10) $280,000 Prime
Parkway, 12, 1995 Line + .25%
Ltd.(9)
Renner December Business $301,079(12) $150,000 Prime
Oldsmobile 13, 1995 Line
(11)
_______________
(1) Dr. Niebler is a director of the Company. The loan was made
jointly to Dr. Niebler and an unaffiliated third party.
(2) Mr. Krause, a director of the Company, is the brother of James
Krause.
(3) The maximum amount that can be borrowed under the credit line is
$479,529.
(4) Dr. Niebler, a director of the Company, is the father of David
Niebler.
(5) Dr. Niebler is a director of the Company.
(6) The maximum amount that can be borrowed under the credit line is
$132,000.
(7) Mr. Menzel, President and Chief Executive Officer of the
Company, is the father-in-law of Christopher Grow. This loan
was sold by the Company in the secondary market after
origination.
(8) Mr. Krause, a director of the Company, is the spouse and brother-
in-law of the general partners of JDW Realty Company.
(9) Mr. Hoesly, a director of the Company, is Secretary of River
Parkway, Ltd.
(10) The maximum amount that can be borrowed under the credit line
is $450,000.
(11) Mr. Renner, a director of the Company, is the owner of Renner
Oldsmobile.
(12) The maximum amount that can be borrowed under the credit line
is $675,000.
INDEPENDENT AUDITORS
Conley McDonald LLP served as the Company's independent auditors
for the fiscal year ended December 31, 1996. The Board has similarly
appointed Conley McDonald LLP to serve as independent auditors for the
Company for the fiscal year ending December 31, 1997. Representatives of
Conley McDonald LLP are expected to be present at the Annual Meeting with
the opportunity to make a statement if they so desire. Such
representatives are also expected to be available to respond to
appropriate questions.
MISCELLANEOUS
Shareholder Proposals
Proposals which shareholders of the Company intend to present at
and have included in the Company's proxy statement for the 1998 annual
meeting must be received by the Company by the close of business on
November 20, 1997.
Solicitation Expenses
The cost of soliciting proxies will be borne by the Company. In
addition to soliciting proxies by mail, proxies may be solicited
personally and by telephone by certain officers and regular employees of
the Company. The Company will also reimburse brokers and other nominees
for their reasonable expenses in communicating with the persons for whom
they hold Common Stock.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company's
executive officers and directors to file reports of ownership and changes
of ownership with the Securities and Exchange Commission. The regulations
of the Securities and Exchange Commission require such persons to furnish
the Company with copies of all Section 16(a) reports they file. Based on
such reports, the Company believes that all of its officers and directors
have complied with the Section 16(a) filing requirements, except that Mr.
Krause filed two late reports with respect to two purchases of Common
Stock, and Mr. Hoesly filed one late report with respect to a purchase of
Common Stock.
The Company will provide without charge a copy of its Annual
Report on Form 10-KSB (including financial statements and financial
schedules, but not including exhibits thereto), as filed with the
Securities and Exchange Commission, to each person who is a record or
beneficial owner of Common Stock as of the record date for the Annual
Meeting. A written request for a Form 10-KSB should be directed to
William R. Hayes, Vice President and Treasurer, Ridgestone Financial
Services, Inc., 13925 West North Avenue, Brookfield, Wisconsin 53005.
By Order of the Board of Directors
RIDGESTONE FINANCIAL SERVICES, INC.
Christine V. Lake
Vice President and Secretary
March 21, 1997
<PAGE>
Appendix A
RIDGESTONE FINANCIAL SERVICES, INC.
1996 Stock Option Plan
Section 1. Purpose
The purpose of the Ridgestone Financial Services, Inc. 1996 Stock
Option Plan (the "Plan") is to promote the best interests of Ridgestone
Financial Services, Inc. (together with any successor thereto, the
"Company") and its shareholders by providing key employees of the Company
and its Affiliates (as defined below) with an opportunity to acquire a
proprietary interest in the Company. It is intended that the Plan will
promote continuity of management and increased incentive and personal
interest in the welfare of the Company by those key employees who are
primarily responsible for shaping and carrying out the long-range plans of
the Company and securing the Company's continued growth and financial
success.
Section 2. Definitions
As used in the Plan, the following terms shall have the respective
meanings set forth below:
(a) "Affiliate" shall mean any entity that, directly or through one
or more intermediaries, is controlled by, controls, or is under common
control with, the Company, including, without limitation, Ridgestone Bank.
(b) "Stock Option Agreement" shall mean any written agreement,
contract, or other instrument or document evidencing any Option granted
under the Plan.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
(d) "Commission" shall mean the United States Securities and
Exchange Commission or any successor agency.
(e) "Committee" shall mean a committee of the Board of Directors of
the Company designated by such Board to administer the Plan and comprised
of not less than two directors, each of whom is eligible and qualified to
serve thereon as provided by Rule 16b-3 and each of whom is an "outside
director" within the meaning of Section 162(m)(4)(C) of the Code (or any
successor provision thereto).
(f) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time.
(g) "Fair Market Value" shall mean, with respect to any property
(including, without limitation, any Shares or other securities), the fair
market value of such property determined by such methods or procedures as
shall be established from time to time by the Committee.
(h) "Incentive Stock Option" shall mean an Option granted under
Section 6(a) of the Plan that is intended to meet the requirements of
Section 422 of the Code (or any successor provision thereto).
(i) "Key Employee" shall mean any officer or other key employee of
the Company or of any Affiliate who is responsible for or contributes to
the management, growth or profitability of the business of the Company or
any Affiliate as determined by the Committee.
(j) "Non-Qualified Stock Option" shall mean an Option granted under
Section 6(a) of the Plan that is not intended to be an Incentive Stock
Option.
(k) "Option" shall mean an Incentive Stock Option or a Non-Qualified
Stock Option.
(l) "Participating Key Employee" shall mean a Key Employee
designated to be granted an Option under the Plan.
(m) "Person" shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization, or
government or political subdivision thereof.
(n) "Rule 16b-3" shall mean Rule 16b-3 as promulgated by the
Commission under the Exchange Act, or any successor rule or regulation
thereto.
(o) "Shares" shall mean shares of common stock of the Company, no
par value, and such other securities or property as may become subject to
Options pursuant to an adjustment made under Section 4(b) of the Plan.
Section 3. Administration
The Plan shall be administered by the Committee; provided, however,
that if at any time the Committee shall not be in existence, the functions
of the Committee as specified in the Plan shall be exercised by a
committee consisting of those members of the Board of Directors of the
Company who qualify as persons eligible to serve thereon pursuant to Rule
16b-3 and as "outside directors" under Section 162(m)(4)(C) of the Code
(or any successor provision thereto). Subject to the terms of the Plan
and without limitation by reason of enumeration, the Committee shall have
full power and authority to: (i) designate Participating Key Employees;
(ii) determine the type or types of Options to be granted to each
Participating Key Employee under the Plan; (iii) determine the number of
Shares to be covered by Options granted to Participating Key Employees;
(iv) determine the terms and conditions of any Option granted to a
Participating Key Employee; (v) interpret and administer the Plan and any
instrument or agreement relating to, or Option granted under, the Plan
(including, without limitation, any Stock Option Agreement); (vi)
establish, amend, suspend, or waive such rules and regulations and appoint
such agents as it shall deem appropriate for the proper administration of
the Plan; and (vii) make any other determination and take any other action
that the Committee deems necessary or desirable for the administration of
the Plan. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations, and other decisions under
or with respect to the Plan or any Option shall be within the sole
discretion of the Committee, may be made at any time, and shall be final,
conclusive, and binding upon all Persons, including the Company, any
Affiliate, any Participating Key Employee, any holder or beneficiary of
any Option, any shareholder, and any employee of the Company or of any
Affiliate.
Section 4. Shares Available for Award
(a) Shares Available. Subject to adjustment as provided in
Section 4(b):
(i) Number of Shares Available. The number of Shares with
respect to which Options may be granted under the Plan shall be 100,000.
If, after the effective date of the Plan, an Option is forfeited or if an
Option otherwise terminates, expires or is cancelled prior to the delivery
of all of the Shares or of other consideration issuable or payable
pursuant to such Option, then the number of Shares counted against the
number of Shares available under the Plan in connection with the grant of
such Option, to the extent of any such forfeiture, termination, expiration
or cancellation, shall again be available for granting of additional
Options under the Plan.
(ii) Limitations on Option Grants to Individual Participants.
During any one calendar year, no Participating Key Employee shall be
granted Options under the Plan for more than 25,000 Shares. Such number
of Shares as specified in the preceding sentence shall be subject to
adjustment in accordance with the terms of Section 4(b) hereof. In all
cases, determinations under this Section 4(a)(ii) shall be made in a
manner that is consistent with the exemption for performance-based
compensation provided by Section 162(m) of the Code (or any successor
provision thereto) and any regulations promulgated thereunder.
(iii) Accounting for Options. The number of Shares covered by
an Option under the Plan shall be counted on the date of grant of such
Option against the number of Shares available for granting of Options
under the Plan.
(iv) Sources of Shares Deliverable Under Options. Any Shares
delivered pursuant to an Option may consist, in whole or in part, of
authorized and unissued Shares or of treasury Shares.
(b) Adjustments. In the event that the Committee shall determine
that any dividend or other distribution (whether in the form of cash,
Shares, other securities, or other property), recapitalization, stock
split, reverse stock split, reorganization, merger, consolidation, split-
up, spin-off, combination, repurchase, or exchange of Shares or other
securities of the Company, issuance of warrants or other rights to
purchase Shares or other securities of the Company, or other similar
corporate transaction or event affects the Shares such that an adjustment
is determined by the Committee to be appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to
be made available under the Plan, then the Committee may, in such manner
as it may deem equitable, adjust any or all of (i) the number and type of
Shares subject to the Plan and which thereafter may be made the subject of
Options under the Plan, (ii) the number and type of Shares subject to
outstanding Options, and (iii) the exercise price with respect to any
Options, or, if deemed appropriate, make provision for a cash payment to
the holder of an outstanding Option; provided, however, in each case, that
with respect to Incentive Stock Options no such adjustment shall be
authorized to the extent that such authority would cause the Plan to
violate Section 422(b) of the Code (or any successor provision thereto);
and provided further that the number of Shares subject to an Option shall
always be a whole number.
Section 5. Eligibility
Any Key Employee, including any executive officer or employee-
director of the Company or of any Affiliate, who is not a member of the
Committee shall be eligible to be designated a Participating Key Employee.
Section 6. Awards
(a) Option Awards to Key Employees. The Committee is hereby
authorized to grant Options to Key Employees with the terms and conditions
as set forth below and with such additional terms and conditions, in
either case not inconsistent with the provisions of the Plan, as the
Committee shall determine.
(i) Exercise Price. The exercise price per Share of an
Option granted pursuant to this Section 6(a) shall be determined by the
Committee; provided, however, that such exercise price shall not be less
than 100% of the Fair Market Value of a Share on the date of grant of such
Option.
(ii) Option Term. The term of each Option shall be fixed by
the Committee; provided, however, that in no event shall the term of any
Option exceed a period of ten years from the date of its grant.
(iii) Exercisability and Method of Exercise. An Option shall
become exercisable in such manner and within such period or periods and in
such installments or otherwise as shall be determined by the Committee.
The Committee also shall determine the method or methods by which, and the
form or forms, including, without limitation, cash, Shares, other
securities, other Options, or other property, or any combination thereof,
having a Fair Market Value on the exercise date equal to the relevant
exercise price, in which payment of the exercise price with respect to any
Option may be made or deemed to have been made.
(iv) Incentive Stock Options. The terms of any Incentive
Stock Option granted under the Plan shall comply in all respects with the
provisions of Section 422 of the Code (or any successor provision thereto)
and any regulations promulgated thereunder. Notwithstanding any provision
in the Plan to the contrary, no Incentive Stock Option may be granted
hereunder after the tenth anniversary of the adoption of the Plan by the
Board of Directors of the Company.
(b) General.
(i) No Consideration for Options. Options shall be granted
to Participating Key Employees without the requirement of cash
consideration unless otherwise determined by the Committee.
(ii) Stock Option Agreements. Each Option granted under the
Plan shall be evidenced by a Stock Option Agreement in such form
(consistent with the terms of the Plan) as shall have been approved by the
Committee.
(iii) Options May Be Granted Separately or Together. Options
granted to Participating Key Employees under the Plan may be granted
either alone or in addition to, in tandem with, or in substitution for any
other Option or any award granted under any other plan of the Company or
any Affiliate. Options granted in addition to or in tandem with other
Options, or in addition to or in tandem with awards granted under any
other plan of the Company or any Affiliate, may be granted either at the
same time as or at a different time from the grant of such other Options
or awards.
(iv) Limits on Transfer of Options. No Option shall be
assignable, alienable, salable or transferable by a Participating Key
Employee otherwise than by will or by the laws of descent and
distribution; provided, however, that a Participating Key Employee at the
discretion of the Committee may be entitled, in the manner established by
the Committee, to designate a beneficiary or beneficiaries to exercise his
or her rights, and to receive any property distributable, with respect to
any Option upon the death of the Participating Key Employee; and provided
further that a participating Key Employee at the discretion (as reflected
in the applicable Stock Option Agreement) of the Committee and subject to
the limitations of the Code in the case of an Incentive Stock Option may
be entitled to assign, alienate, sell or transfer an Option to the extent
permitted by Rule 16b-3. Unless otherwise provided by the Committee in
its sole discretion (as reflected in the applicable Stock Option
Agreement) and subject to the limitations of the Code in the case of an
Incentive Stock Option, (i) each Option shall be exercisable, during the
lifetime of the Participating Key Employee, only by such individual or, if
permissible under applicable law, by such individual's guardian or legal
representative and (ii) no Option may be pledged, attached, or otherwise
encumbered, and any purported pledge, attachment, or encumbrance thereof
shall be void and unenforceable against the Company or any Affiliate.
(v) Term of Options. The term of each Option shall be for
such period as may be determined by the Committee but the expiration date
of an Option shall be not later than ten years after the date such Option
is granted.
(vi) Share Certificates; Representation. All certificates for
Shares delivered under the Plan pursuant to the exercise of any Option
shall be subject to such stop transfer orders and other restrictions as
the Committee may deem advisable under the Plan or the rules, regulations,
and other requirements of the Commission, any stock exchange or other
market upon which such Shares are then listed or traded, and any
applicable federal or state securities laws, and the Committee may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions. The Committee may require each
Participating Key Employee or other Person who acquires Shares under the
Plan by means of an Option originally made to a Participating Key Employee
to represent to the Company in writing that such Participating Key
Employee or other Person is acquiring the Shares without a view to the
distribution thereof.
Section 7. Amendment and Termination of the Plan; Correction of Defects
and Omissions
(a) Amendments to and Termination of the Plan. The Board of
Directors of the Company may at any time amend, alter, suspend,
discontinue, or terminate the Plan; provided, however, that shareholder
approval of any amendment of the Plan shall also be obtained if otherwise
required by: (i) the Code or any rules promulgated thereunder (in order
to allow for Incentive Stock Options to be granted under the Plan), (ii)
any other applicable law, or (iii) the quotation or listing requirements
of any principal securities exchange or market on which the Shares are
then traded (in order to maintain the quotation or listing of the Shares
thereon). Amendment, alteration, suspension, discontinuance or
termination of the Plan shall not affect the rights of Participating Key
Employees without their consent with respect to Options previously granted
to them, and all unexpired Options shall continue in force and effect
after termination of the Plan except as they may lapse or be terminated by
their own terms and conditions.
(b) Correction of Defects, Omissions and Inconsistencies. The
Committee may correct any defect, supply any omission, or reconcile any
inconsistency in any Option or Stock Option Agreement in the manner and to
the extent it shall deem desirable to carry the Plan into effect.
Section 8. General Provisions
(a) No Rights to Options. No Key Employee, Participating Key
Employee or other Person shall have any claim to be granted an Option
under the Plan, and there is no obligation for uniformity of treatment of
Key Employees, Participating Key Employees, or holders or beneficiaries of
Options under the Plan. The terms and conditions of Options need not be
the same with respect to each Participating Key Employee.
(b) Withholding. No later than the date as to which an amount first
becomes includable in the gross income of a Participating Key Employee for
federal income tax purposes with respect to any Option granted under the
Plan, the Participating Key Employee shall pay to the Company, or make
arrangements satisfactory to the Company regarding the payment of, any
federal, state, local or foreign taxes of any kind required or permitted
by law to be withheld with respect to such amount. Unless otherwise
determined by the Committee, withholding obligations arising with respect
to Options granted to Participating Key Employees under the Plan may be
settled with Shares, including Shares that are part of, or are received
upon exercise of, the Option that gives rise to the withholding
requirement. The obligations of the Company under the Plan shall be
conditional on such payment or arrangements, and the Company and any
Affiliate shall, to the extent permitted by law, have the right to deduct
any such taxes from any payment otherwise due to the Participating Key
Employee. The Committee may establish such procedures as it deems
appropriate for the settling of withholding obligations with Shares,
including, without limitation, the establishment of such procedures as may
be necessary to satisfy the requirements of Rule 16b-3.
(c) No Limit on Other Compensation Arrangements. Nothing contained
in the Plan shall prevent the Company or any Affiliate from adopting or
continuing in effect other or additional compensation arrangements, and
such arrangements may be either generally applicable or applicable only in
specific cases.
(d) Rights and Status of Recipients of Options. The grant of an
Option shall not be construed as giving a Participating Key Employee the
right to be retained in the employ of the Company or any Affiliate.
Further, the Company or any Affiliate may at any time dismiss a
Participating Key Employee from employment, free from any liability, or
any claim under the Plan, unless otherwise expressly provided in the Plan
or in any Stock Option Agreement. Participating Key Employees shall have
no rights as holders of Shares as a result of the granting of Options
hereunder.
(e) Governing Law. The validity, construction and effect of the
Plan and any rules and regulations relating to the Plan shall be
determined in accordance with the laws of the State of Wisconsin and
applicable federal law.
(f) Severability. If any provision of the Plan or any Stock Option
Agreement or any Option is or becomes or is deemed to be invalid, illegal,
or unenforceable in any jurisdiction, or as to any Person or Option, or
would disqualify the Plan, any Stock Option Agreement or any Option under
any law deemed applicable by the Committee, such provision shall be
construed or deemed amended to conform to applicable laws, or if it cannot
be so construed or deemed amended without, in the determination of the
Committee, materially altering the intent of the Plan, any Stock Option
Agreement or the Option, such provision shall be stricken as to such
jurisdiction, Person, or Option, and the remainder of the Plan, any such
Stock Option Agreement and any such Option shall remain in full force and
effect.
(g) No Fractional Shares. No fractional Shares or other securities
shall be issued or delivered pursuant to the Plan, any Stock Option
Agreement or any Option, and the Committee shall determine (except as
otherwise provided in the Plan) whether cash, other securities, or other
property shall be paid or transferred in lieu of any fractional Shares or
other securities, or whether such fractional Shares or other securities or
any rights thereto shall be canceled, terminated, or otherwise eliminated.
(h) Headings. Headings are given to the Sections and subsections of
the Plan solely as a convenience to facilitate reference. Such headings
shall not be deemed in any way material or relevant to the construction or
interpretation of the Plan or any provision thereof.
Section 9. Effective Date of the Plan
The Plan shall be effective on the date of adoption of the Plan by
the Board of Directors of the Company provided that the Plan is approved
by the shareholders of the Company within twelve months following the date
of adoption of the Plan by the Board of Directors. All Options granted
prior to shareholder approval of the Plan shall be contingent upon
shareholder approval and shall not be exercisable until after such
approval.
<PAGE>
Ridgestone Financial Services, Inc.
13925 West North Avenue
Brookfield, Wisconsin 53005
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Paul E. Menzel and William R. Hayes, or
either of them (with full power of substitution in each of them), as
Proxies, and hereby authorizes them to represent and to vote as designated
below all of the shares of Common Stock of Ridgestone Financial Services,
Inc. held of record by the undersigned on March 3, 1997 at the annual
meeting of shareholders to be held on April 22, 1997, or any adjournment
or postponement thereof.
1. ELECTION OF DIRECTORS (terms expiring at the 1998 Annual Meeting)
[_] FOR all nominees listed below [_] WITHHOLD AUTHORITY
(except as marked to the contrary below) to vote for all
nominees listed
below
PROXY P. Menzel, W. Hayes, C. Lake, C. Ackley, G. Hoesly, J. Horning,
W. Krause, Jr., C. Niebler, F. Olson,
J. Renner, R. Streff and W. Tetzlaff
INSTRUCTION: To withhold authority to vote for any individual
nominee, write that nominee's name on the space
provided below.
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2. PROPOSAL TO APPROVE THE 1996 STOCK OPTION PLAN.
[_] FOR [_] AGAINST [_] ABSTAIN
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH
OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this
proxy will be voted "FOR" the election of the Board's nominees and "FOR"
the proposal to adopt the 1996 Stock Option Plan.
Please sign exactly as your name appears hereon. When shares
are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please
give your full title as such. If a corporation, please sign in
full corporate name by President or other authorized officer.
If a partnership, please sign in partnership name by authorized
person.
DATED: ____________________, 1997
______________________________________________
Signature
______________________________________________
Signature (if held jointly)
PLEASE SIGN, DATE AND RETURN THE PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE
