SCHEDULE 14A/A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant |X|
Filed by a Party other than the Registrant|_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
|_| Definitive Proxy Statement
|X| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
NORTH CENTRAL BANCSHARES, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X|1 $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
|_| $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
|_| 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:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how
it was determined.):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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|_| 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 the date of its filing.
1) Amount Previously Paid:
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4) Date Filed:
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1 Fee paid with Schedule 14A filed with the Commission on August 14,
1996.
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[LETTERHEAD OF NORTH CENTRAL BANCSHARES, INC.]
August 19, 1996
Dear Shareholder:
You recently received the Proxy Statement for a Special Meeting of
Shareholders of North Central Bancshares, Inc. to be held on September 21, 1996.
Enclosed is the North Central Bancshares, Inc. 1996 Stock Option Plan, which
serves as Appendix A to the Proxy Statement, but which was inadvertently not
included with the materials you received. We apologize for any inconvenience
this may have caused you.
We urge you to read the Proxy Statement and Appendix A carefully and
vote your shares in favor with the proposal to approve the North Central
Bancshares, Inc. 1996 Stock Option Plan.
Thank you.
Sincerely,
/s/ David M. Bradley
David M. Bradley
PRESIDENT AND CHIEF EXECUTIVE OFFICER
<PAGE>
APPENDIX A
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NORTH CENTRAL BANCSHARES, INC.
1996 STOCK OPTION PLAN
ARTICLE I
PURPOSE
SECTION 1.1 GENERAL PURPOSE OF THE PLAN.
The purpose of the Plan is to promote the growth and
profitability of North Central Bancshares, Inc., to provide certain key
officers, employees and directors of North Central Bancshares, Inc. and its
affiliates with an incentive to achieve corporate objectives, to attract and
retain individuals of outstanding competence and to provide such individuals
with an equity interest in North Central Bancshares, Inc.
ARTICLE II
DEFINITIONS
The following definitions shall apply for the purposes of this
Plan, unless a different meaning is plainly indicated by the context:
SECTION 2.1 BANK means First Federal Savings Bank of Fort
Dodge, a federally chartered savings institution, and any successor thereto.
SECTION 2.2 BOARD means the board of directors of North
Central Bancshares, Inc.
SECTION 2.3 CHANGE IN CONTROL OF THE COMPANY means any of the
following events:
(a) approval by the stockholders of North Central
Bancshares, Inc. of a transaction that would result in the
reorganization, merger or consolidation of North Central Bancshares,
Inc. with one or more other persons, other than a transaction following
which:
(i) at least 51% of the equity ownership interests of
the entity resulting from such transaction are beneficially
owned (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) in substantially the same relative proportions
by persons who, immediately prior to such transaction,
beneficially owned (within the meaning of Rule 13d-3
promulgated under the Exchange Act) at least 51% of the
outstanding equity ownership interests in North Central
Bancshares, Inc.; and
(ii) at least 51% of the securities entitled to vote
generally in the election of directors of the entity resulting
from such transaction are beneficially owned (within the
meaning of Rule 13d- 3 promulgated under the Exchange Act) in
substantially the same relative proportions by persons who,
immediately prior to such transaction, beneficially owned
(within the meaning of Rule 13d-3 promulgated under the
Exchange Act) at least 51% of the securities entitled to vote
generally in the election of directors of North Central
Bancshares, Inc.;
(b) the acquisition of all or substantially all of the
assets of North Central Bancshares, Inc. or beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 20% or more of the outstanding securities of North Central
Bancshares, Inc. entitled to vote generally in the election of
directors by any person or by any persons acting in concert, or
approval by the stockholders of North Central Bancshares, Inc. of any
transaction which would result in such an acquisition;
(c) a complete liquidation or dissolution of North
Central Bancshares, Inc., or approval by the stockholders of North
Central Bancshares, Inc. of a plan for such liquidation or dissolution;
(d) the occurrence of any event if, immediately following
such event, at least 50% of the members of the Board of Directors of
North Central Bancshares, Inc. do not belong to any of the following
groups:
(i) individuals who were members of the Board of
Directors of North Central Bancshares, Inc. on the effective
date of this Plan; or
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(ii) individuals who first became members of the
Board of Directors of North Central Bancshares, Inc. after the
effective date of this Plan either:
(A) upon election to serve as a member of
the Board of Directors of North Central Bancshares,
Inc. by affirmative vote of three-quarters of the
members of such Board, or of a nominating committee
thereof, in office at the time of such first
election; or
(B) upon election by the stockholders of
North Central Bancshares, Inc. to serve as a member
of the Board of North Central Bancshares, Inc., but
only if nominated for election by affirmative vote of
three-quarters of the members of the Board of
Directors of North Central Bancshares, Inc., or of a
nominating committee thereof, in office at the time
of such first nomination;
PROVIDED, HOWEVER, that such individual's election or
nomination did not result from an actual or threatened
election contest (within the meaning of Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies or consents
(within the meaning of Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) other than by or on behalf
of the Board of North Central Bancshares, Inc.; or
(e) any event which would be described in section 2.3(a),
(b), (c) or (d) if the term "Bank" were substituted for the term "North
Central Bancshares, Inc." therein.
In no event, however, shall a Change in Control be deemed to have occurred as a
result of any acquisition of securities or assets of North Central Bancshares,
Inc., the Bank, or a subsidiary of either of them, by North Central Bancshares,
Inc., the Bank, or a subsidiary of either of them, or by any employee benefit
plan maintained by any of them. For purposes of this section 2.3, the term
"person" shall have the meaning assigned to it under sections 13(d)(3) or
14(d)(2) of the Exchange Act.
SECTION 2.4 CODE means the Internal Revenue Code of 1986
(including the corresponding provisions of any succeeding law).
SECTION 2.5 COMMITTEE means the Committee described in
section 3.1.
SECTION 2.6 COMPANY means North Central Bancshares,
Inc., a corporation organized and existing under the laws of the State of Iowa,
and any successor thereto, the Bank and any successor thereto and, with the
prior approval of the Board, and subject to such terms and conditions as may be
imposed by the Board, any other savings bank, savings and loan association,
bank, corporation, financial institution or other business organization or
institution.
SECTION 2.7 DISABILITY means a condition of total
incapacity, mental or physical, for further performance of duty with the Company
which the Committee shall have determined, on the basis of competent medical
evidence, is likely to be permanent.
SECTION 2.8 DISINTERESTED BOARD MEMBER means a member of
the Board who (a) is not a current employee of the Company, (b) is not a former
employee of the Company who receives compensation for prior services (other than
benefits under a tax-qualified retirement plan) during the taxable year, (c) has
not been an officer of the Company, (d) does not receive remuneration from the
Company, either directly or indirectly, in any capacity other than as a director
and (d) is not currently and for a period of at least one year has not been
eligible for discretionary awards under any stock compensation plan of the
Company. The term Disinterested Board Member shall be interpreted in such manner
as shall be necessary to conform to the requirements of section 162(m) of the
Code and Rule 16b-3 promulgated under the Exchange Act.
SECTION 2.9 EFFECTIVE DATE means September 21, 1996.
SECTION 2.10 ELIGIBLE INDIVIDUAL means any individual
whom the Committee may determine to be a key officer or employee of the Company
and select to receive a grant of an Option pursuant to the Plan.
SECTION 2.11 ELIGIBLE DIRECTOR means a member of the
Board who is not also an employee or an officer of the Company.
SECTION 2.12 EXCHANGE ACT means the Securities Exchange
Act of 1934, as amended.
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SECTION 2.13 EXERCISE PRICE means the price per Share at
which Shares subject to an Option may be purchased upon exercise of the Option,
determined in accordance with section 4.3 with regard to Options granted to
Eligible Individuals and section 4.4 with regard to Options granted to Eligible
Directors.
SECTION 2.14 FAIR MARKET VALUE means, with respect to a
Share on a specified date:
(a) the final reported sales price on the date in question (or
if there is no reported sale on such date, on the last preceding date
on which any reported sale occurred) as reported in the principal
consolidated reporting system with respect to securities listed or
admitted to trading on the principal United States securities exchange
on which the Shares are listed or admitted to trading; or
(b) if the Shares are not listed or admitted to trading on any
such exchange, the closing bid quotation with respect to a Share on
such date on the National Association of Securities Dealers Automated
Quotations System, or, if no such quotation is provided, on another
similar system, selected by the Committee, then in use; or
(c) if sections 2.14(a) and (b) are not applicable, the fair
market value of a Share as the Committee may determine.
SECTION 2.15 INCENTIVE STOCK OPTION means a right to
purchase Shares that is granted pursuant to section 4.1, that is designated by
the Committee to be an Incentive Stock Option and that is intended to satisfy
the requirements of section 422 of the Code.
SECTION 2.16 LIMITED STOCK APPRECIATION RIGHT means a
right granted pursuant to section 4.8.
SECTION 2.17 NON-QUALIFIED STOCK OPTION means a right to
purchase Shares that (a) is granted pursuant to section 4.1 or section 4.4 and
is designated by the Committee to be a Non-Qualified Stock Option, or (b) does
not satisfy the requirements of section 422 of the Code.
SECTION 2.18 OPTION means either an Incentive Stock
Option or a Non-Qualified Stock Option.
SECTION 2.19 OPTION PERIOD means the period during which
an Option may be exercised, determined in accordance with section 4.3 with
regard to Options granted to Eligible Individuals and section 4.4 with regard to
Options granted to Eligible Directors.
SECTION 2.20 PERSON means an individual, a corporation, a
bank, a savings bank, a savings and loan association, a financial institution, a
partnership, an association, a joint-stock company, a trust, an estate, an
unincorporated organization and any other business organization or institution.
SECTION 2.21 PLAN means the North Central Bancshares,
Inc. 1996 Stock Option Plan, as amended from time to time.
SECTION 2.22 QUALIFIED DOMESTIC RELATIONS ORDER means a
Domestic Relations Order that: (a) clearly specifies (i) the name and last known
mailing address of the Option holder and of each person given rights under such
Domestic Relations Order, (ii) the amount or percentages of the Option holder's
benefits under this Plan to be paid to each person covered by such Domestic
Relations Order, (iii) the number of payments or the period to which such
Domestic Relations Order applies, and (iv) the name of this Plan; and (b) does
not require the payment of a benefit in a form or amount that is (i) not
otherwise provided for under the Plan, or (ii) inconsistent with a previous
Qualified Domestic Relations Order. For the purposes of this Plan, a "Domestic
Relations Order" means a judgment, decree or order (including the approval of a
property settlement) that is made pursuant to a state domestic relations or
community property law and relates to the provision of child support, alimony
payments, or marital property rights to a spouse, child or other dependent of an
Option holder.
SECTION 2.23 RETIREMENT means retirement at the normal or
early retirement date as set forth in any tax-qualified retirement plan of the
Bank.
SECTION 2.24 SERVICE means service for the Company as an
employee in any capacity, service as a director or advisory director of the
Company, or, with respect to any individual who is contractually bound by
restrictive covenants against competition or solicitation which operate to
benefit the Company, performance under such covenants.
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SECTION 2.25 SHARE means a share of Common Stock, par
value $.01 per share, of North Central Bancshares, Inc.
SECTION 2.26 TERMINATION FOR CAUSE means one of the
following:
(a) for an Eligible Employee who is not an officer or employee
of any bank or savings institution regulated by the Office of Thrift
Supervision, termination of employment with the Company upon the
occurrence of any of the following: (i) the employee intentionally
engages in dishonest conduct in connection with his performance of
services for the Company resulting in his conviction of a felony; (ii)
the employee is convicted of, or pleads guilty or NOLO CONTENDERE to, a
felony or any crime involving moral turpitude; (iii) the employee
willfully fails or refuses to perform his duties under any employment
or retention agreement and fails to cure such breach within sixty (60)
days following written notice thereof from the Company; (iv) the
employee breaches his fiduciary duties to the Company for personal
profit; or (v) the employee's willful breach or violation of any law,
rule or regulation (other than traffic violations or similar offenses),
or final cease and desist order in connection with his performance of
services for the Company;
(b) for an Eligible Employee who is an officer or employee of
a bank or savings institution regulated by the Office of Thrift
Supervision, termination of employment for personal dishonesty,
incompetence, willful misconduct, breach of fiduciary duty involving
personal profit, intentional failure to perform stated duties, willful
violation of any law, rule or regulation (other than traffic violations
or similar offenses) or final cease and desist order, or any material
breach of this Agreement, in each case as measured against standards
generally prevailing at the relevant time in the savings and community
banking industry;
PROVIDED, HOWEVER, that such individual shall not be deemed to have been
discharged for cause unless and until he shall have received a written notice of
termination from the Board, which notice shall be given to such individual not
later than five (5) business days after the Board adopts, and shall be
accompanied by, a resolution duly approved by affirmative vote of a majority of
the entire Board at a meeting called and held for such purpose (which meeting
shall be held not more than fifteen (15) days nor more than thirty (30) days
after notice to the individual), at which meeting there shall be a reasonable
opportunity for the individual to make oral and written presentations to the
members of the Board, on his own behalf, or through a representative, who may be
his legal counsel, to refute the grounds for the proposed determination) finding
that in the good faith opinion of the Board grounds exist for discharging the
individual for cause.
ARTICLE III
ADMINISTRATION
SECTION 3.1 COMMITTEE.
The Plan shall be administered by a Committee consisting of
the members of the Compensation Committee of North Central Bancshares, Inc. who
are Disinterested Board Members. If fewer than two members of the Compensation
Committee are Disinterested Board Members, then the Board shall appoint to the
Committee such additional Disinterested Board Members as shall be necessary to
provide for a Committee consisting of at least two Disinterested Board Members.
SECTION 3.2 COMMITTEE ACTION.
The Committee shall hold such meetings, and may make such
administrative rules and regulations, as it may deem proper. A majority of the
members of the Committee shall constitute a quorum, and the action of a majority
of the members of the Committee present at a meeting at which a quorum is
present, as well as actions taken pursuant to the unanimous written consent of
all of the members of the Committee without holding a meeting, shall be deemed
to be actions of the Committee. All actions of the Committee shall be final and
conclusive and shall be binding upon the Company and all other interested
parties. Any Person dealing with the Committee shall be fully protected in
relying upon any written notice, instruction, direction or other communication
signed by the secretary of the Committee and one member of the Committee, by two
members of the Committee or by a representative of the Committee authorized to
sign the same in its behalf.
SECTION 3.3 COMMITTEE RESPONSIBILITIES.
Subject to the terms and conditions of the Plan and such
limitations as may be imposed from time to time by the Board, the Committee
shall be responsible for the overall management and administration of the Plan
and shall have such authority as shall be necessary or appropriate in order to
carry out its responsibilities, including, without limitation, the authority:
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(a) to interpret and construe the Plan, and to determine
all questions that may arise under the Plan as to eligibility for
participation in the Plan, the number of Shares subject to the Options,
if any, to be granted, and the terms and conditions thereof;
(b) to adopt rules and regulations and to prescribe forms
for the operation and administration of the Plan; and
(c) to take any other action not inconsistent with the
provisions of the Plan that it may deem necessary or appropriate.
ARTICLE IV
STOCK OPTIONS
SECTION 4.1 IN GENERAL.
Subject to the limitations of the Plan, the Committee may, in
its discretion, grant to an Eligible Individual an Option to purchase Shares.
Any such Option shall be evidenced by a written agreement which shall:
(a) designate the Option as either an Incentive Stock
Option or a Non-Qualified Stock Option;
(b) specify the number of Shares covered by the Option;
(c) specify the Exercise Price, determined in accordance
with section 4.3(b), for the Shares subject to the Option;
(d) specify the Option Period determined in accordance
with section 4.3(c);
(e) set forth specifically or incorporate by reference
the applicable provisions of the Plan; and
(f) contain such other terms and conditions not
inconsistent with the Plan as the Committee may, in its discretion,
prescribe with respect to an Option granted to an Eligible Individual.
SECTION 4.2 AVAILABLE SHARES.
Subject to section 5.3, the maximum aggregate number of Shares
with respect to which Options may be granted at any time shall be equal to the
excess of:
(a) 401,105 Shares; over
(b) the sum of:
(i) the number of Shares with respect to which
previously granted Options may then or may in the future be
exercised; plus
(ii) the number of Shares with respect to which
previously granted Options have been exercised.
For purposes of this section 4.2, an Option shall not be considered as having
been exercised to the extent that such Option terminates by reason other than
the purchase of the related Shares. In no event shall more than a cumulative
total of 120,331 Shares be issued under Options granted to Eligible Directors
hereunder.
SECTION 4.3 GRANTS TO ELIGIBLE INDIVIDUALS.
(a) Subject to sections 4.2 and 4.9 and such limitations as
the Board may from time to time impose, the number of Shares as to which an
Eligible Individual may be granted Options shall be determined by the Committee,
in its discretion. Except as provided in section 4.9, the maximum number of
Shares that may be optioned to any one individual under this Plan during its
entire duration shall be the entire number of Shares available under the Plan.
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(b) The price per Share at which an Option granted to an
Eligible Individual may be exercised shall be determined by the Committee, in
its discretion; PROVIDED, HOWEVER, that the Exercise Price shall not be less
than the Fair Market Value of a Share on the date on which the Option is
granted.
(c) Subject to section 4.9, the Option Period during which an
Option granted to an Eligible Individual may be exercised shall commence on the
date specified by the Committee in the Option agreement and shall expire on the
date specified in the Option agreement or, if no date is specified, on the
earliest of:
(i) the close of business on the last day of the
three-month period commencing on the date of the Eligible Individual's
termination of employment with the Company, other than on account of
death or Disability, Retirement or a Termination for Cause;
(ii) the close of business on the last day of the one-year
period commencing on the date of the Eligible Individual's termination
of employment due to death, Disability or Retirement;
(iii) the date and time when the Eligible Individual ceases
to be an employee of the Company due to a Termination for Cause; and
(iv) the last day of the ten-year period commencing on the
date on which the Option was granted.
SECTION 4.4 GRANTS TO ELIGIBLE DIRECTORS.
(a) On the Effective Date, each Person who is then an Eligible
Director shall be granted an Option to purchase Twenty Thousand (20,000) Shares.
(b) Any Person who becomes an Eligible Director after the
Effective Date shall be granted, subject to section 4.2, on January 1 of each
succeeding calendar year during which the Plan is in effect (or, if such date is
not a business day, the first business day thereafter) and provided that the
Eligible Director is still an Eligible Director on that date, an additional
Option to purchase Five Hundred (500) Shares. All Options granted under this
section 4.4(b) after March 21, 1997 shall not be subject to section 4.9(c) but
shall instead be exercisable immediately upon grant.
(c) Any Option granted under this section 4.4 shall be
evidenced by a written agreement which shall specify the number of Shares
covered by the Option, the Exercise Price for the Shares subject to the Option,
and the Option Period, all as determined pursuant to this section 4.4. The
Option agreement shall also set forth specifically or incorporate by reference
the applicable provisions of the Plan.
(d) Notwithstanding sections 4.4(a) and (b), in the event
that, as of the first business day of any calendar month, the number of
available Shares determined under section 4.2 is less than the total number of
Shares with respect to which Options would be granted under section 4.4(b)
during such month, each Eligible Director scheduled to receive a grant of
Options during such month shall be granted an Option for the number of whole
Shares determined by multiplying (i) the number of Shares with respect to which
the Eligible Director would have been granted an Option on such date by (ii) a
fraction, the numerator of which is the number of Shares that are then available
under section 4.2 and the denominator of which is the total number of Shares
that would have to have been available under section 4.2 in order to grant all
of the Options that would otherwise have been granted under section 4.4(b)
during such month, and rounding to the nearest whole Share; PROVIDED, HOWEVER,
if rounding will require more Shares to be available than provided in section
4.1, then the amount determined pursuant to this section 4.4(c) will be
calculated by rounding down to the lesser whole number.
(e) The price per Share at which an Option granted to an
Eligible Director under this section 4.4 may be exercised shall be the Fair
Market Value of a Share on the date on which the Option is granted.
(f) Subject to section 4.4(g), the Option Period during which
an Option granted to an Eligible Director under this section 4.4 may be
exercised shall commence on the date the Option is granted and shall expire on
the earlier of:
(i) removal for cause in accordance with the Company's
bylaws; or
(ii) the last day of the ten-year period commencing on the
date on which the Option was granted.
(g) During the Option Period, the maximum number Shares as to
which an outstanding Option granted pursuant to section 4.4(a) may be exercised
shall be as follows:
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(i) prior to the first anniversary of the date on which
the Option is granted, the Option shall not be exercisable;
(ii) on and after the first anniversary, but prior to the
second anniversary, of the date on which the Option is granted, the
Option may be exercised as to a maximum of Four Thousand (4,000)
Shares;
(iii) on and after the second anniversary, but prior to the
third anniversary, of the date on which the Option is granted, the
Option may be exercised as to a maximum of Eight Thousand (8,000)
Shares, including in such number any optioned Shares purchased prior to
such second anniversary;
(iv) on and after the third anniversary, but prior to the
fourth anniversary, of the date on which the Option is granted, the
Option may be exercised as to a maximum of Twelve Thousand (12,000)
Shares, including in such number any optioned Shares purchased prior to
such third anniversary;
(v) on and after the fourth anniversary, but prior to the
fifth anniversary, of the date on which the Option is granted, the
Option may be exercised as to a maximum of Sixteen Thousand (16,000)
Shares, including in such number any optioned Shares purchased prior to
such fourth anniversary; and
(vi) on and after the fifth anniversary of the date on which
the Option is granted and for the remainder of the Option Period, the
Option may be exercised as to the entire number of optioned Shares not
theretofore purchased.
To the extent that any Option shall not have become exercisable prior to the
date on which the Option holder terminates all Service with the Company, such
Option shall not thereafter become exercisable; PROVIDED, HOWEVER, that such an
Option shall become fully exercisable, and all optioned Shares not previously
purchased shall become available for purchase, on the date of the Option
holder's termination of Service due to death or Disability.
SECTION 4.5 METHOD OF EXERCISE.
(a) Subject to the limitations of the Plan and the Option
agreement, an Option holder may, at any time during the Option Period, exercise
his right to purchase all or any part of the Shares to which the Option relates;
PROVIDED, HOWEVER, that the minimum number of Shares which may be purchased
shall be 100, or, if less, the total number of Shares relating to the Option
which remain unpurchased. An Option holder shall exercise an Option to purchase
Shares by:
(i) giving written notice to the Committee, in such form
and manner as the Committee may prescribe, of his intent to exercise
the Option;
(ii) delivering to the Committee full payment, consistent
with section 4.5(b), for the Shares as to which the Option is to be
exercised; and
(iii) satisfying such other conditions as may be prescribed
in the Option agreement.
(b) The Exercise Price of Shares to be purchased upon exercise
of any Option shall be paid in full in cash (by certified or bank check or such
other instrument as the Company may accept) or, if and to the extent permitted
by the Committee, by one or more of the following: (i) in the form of Shares
already owned beneficially for a period of more than six months by the Option
holder having an aggregate Fair Market Value on the date the Option is exercised
equal to the aggregate Exercise Price to be paid; (ii) after a period of six
months from the date of grant of any such Option, by requesting the Company to
cancel without payment Options outstanding to such Person for that number of
Shares whose aggregate Fair Market Value on the date of exercise, when reduced
by their aggregate Exercise Price, equals the aggregate Exercise Price of the
Options being exercised; or (iii) by a combination thereof; PROVIDED, HOWEVER,
that an election under section 4.5(b)(ii) or (iii) shall be subject to the
conditions and limitations of Rule 16b-3 promulgated under the Exchange Act.
Payment for any Shares to be purchased upon exercise of an Option may also be
made by delivering a properly executed exercise notice to the Company, 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.
(c) When the requirements of section 4.5(a) and (b) have been
satisfied, the Committee shall take such action as is necessary to cause the
issuance of a stock certificate evidencing the Option holder's ownership of such
Shares. The Person exercising the Option shall have no right to vote or to
receive dividends, nor have any other rights with respect to the Shares, prior
to the date as of which such Shares are transferred to such Person on the stock
transfer records of the
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Company, and no adjustments shall be made for any dividends or other rights for
which the record date is prior to the date as of which such transfer is
effected, except as may be required under section 5.3.
SECTION 4.6 LIMITATIONS ON OPTIONS.
(a) An Option by its terms shall not be transferable by the
Option holder other than by will or by the laws of descent and distribution, or
pursuant to the terms of a Qualified Domestic Relations Order, and shall be
exercisable, during the lifetime of the Option holder, only by the Option holder
or an alternate payee designated pursuant to such a Qualified Domestic Relations
Order; PROVIDED, HOWEVER, that notwithstanding any provisions of this Plan to
the contrary, and if permitted by the Committee, an option which is not an
Incentive Stock Option may be transferred by, and only by, the person to whom
the Option was originally granted to (i) one or more of his spouse, children and
grandchildren, or (ii) one or more trusts for the benefit of himself and/or one
or more of the foregoing individuals. Any such transfer shall be effected by
written notice to the Company given in such form and manner as the Committee may
prescribe and shall be recognized only if such notice is received by the Company
prior to the death of the person giving it. Thereafter, the transferee shall
have, with respect to such Option, all of the rights, privileges and obligations
which would attach thereunder to the transferor if the Option were issued to
such transferor. If a privilege of the Option depends on the life, employment or
other status of the transferor, such privilege of the Option for the transferee
shall continue to depend on the life, employment or other status of the
transferor. The Committee shall have full and exclusive authority to interpret
and apply the provisions of this Plan to transferees to the extent not
specifically described herein.
(b) The Company's obligation to deliver Shares with respect to
an Option shall, if the Committee so requests, be conditioned upon the receipt
of a representation as to the investment intention of the Option holder 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 applicable
federal, state or local law. It may be provided that any such representation
shall become inoperative upon a registration of the Shares or upon the
occurrence of any other event eliminating the necessity of such representation.
The Company shall not be required to deliver any Shares under the Plan prior to
(i) the admission of such Shares to listing on any stock exchange on which
Shares may then be listed, or (ii) the completion of such registration or other
qualification under any state or federal law, rule or regulation as the
Committee shall determine to be necessary or advisable.
SECTION 4.7 ADDITIONAL RESTRICTIONS ON INCENTIVE
STOCK OPTIONS.
In addition to the limitations of section 4.6, an Option
designated by the Committee to be an Incentive Stock Option shall be subject to
the following limitations:
(a) If, for any calendar year, the sum of (i) plus (ii)
exceeds $100,000, where (i) equals the Fair Market Value (determined as
of the date of the grant) of Shares subject to an Option intended to be
an Incentive Stock Option which first become available for purchase
during such calendar year, and (ii) equals the Fair Market Value
(determined as of the date of grant) of Shares subject to any other
options intended to be Incentive Stock Options and previously granted
to the same Eligible Individual which first become exercisable in such
calendar year, then that number of Shares optioned which causes the sum
of (i) and (ii) to exceed $100,000 shall be deemed to be Shares
optioned pursuant to a Non-Qualified Stock Option or NonQualified Stock
Options, with the same terms as the Option or Options intended to be an
Incentive Stock Option;
(b) The Exercise Price of an Incentive Stock Option granted to
an Eligible Individual who, at the time the Option is granted, owns
Shares comprising more than 10% of the total combined voting power of
all classes of stock of the Company shall not be less than 110% of the
Fair Market Value of a Share, and if an Option designated as an
Incentive Stock Option shall be granted at an Exercise Price that does
not satisfy this requirement, the designated Exercise Price shall be
observed and the Option shall be treated as a Non-Qualified Stock
Option;
(c) The Option Period of an Incentive Stock Option granted to
an Eligible Individual who, at the time the Option is granted, owns
Shares comprising more than 10% of the total combined voting power of
all classes of stock of the Company, shall expire no later than the
fifth anniversary of the date on which the Option was granted, and if
an Option designated as an Incentive Stock Option shall be granted for
an Option Period that does not satisfy this requirement, the designated
Option Period shall be observed and the Option shall be treated as a
Non-Qualified Stock Option;
(d) An Incentive Stock Option that is exercised during its
designated Option Period but more than (i) three (3) months after the
termination of employment with the Company (other than on account of
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disability within the meaning of section 22(e)(3) of the Code or death)
of the Eligible Individual to whom it was granted; and (ii) one (1)
year after such individual's termination of employment with the Company
due to disability (within the meaning of section 22(e)(3) of the Code);
may be exercised in accordance with the terms but shall be treated as a
Non-Qualified Stock Option; and
(e) Except with the prior written approval of the Committee,
no individual shall dispose of Shares acquired pursuant to the exercise
of an Incentive Stock Option until after the later of (i) the second
anniversary of the date on which the Incentive Stock Option was
granted, or (ii) the first anniversary of the date on which the Shares
were acquired.
SECTION 4.8 LIMITED STOCK APPRECIATION RIGHTS.
(a) Each Option granted under this Plan shall be accompanied
by a Limited Stock Appreciation Right that is exercisable at the times and upon
the terms and conditions set forth herein. Each Limited Stock Appreciation Right
granted hereunder shall be exercisable for a period commencing on the date on
which a Change in Control of the Company occurs and ending six (6) months after
such date or, if later in the case of any Person, thirty (30) days after the
earliest date on which such Person may exercise the Limited Stock Appreciation
Right without subjecting himself to liability under section 16 of the Securities
Exchange Act of 1934, as amended. A Person in possession of a Limited Stock
Appreciation Right granted hereunder may exercise such Limited Stock
Appreciation Right by:
(i) giving written notice to the Committee, in such form
and manner as the Committee may prescribe, of his intent to exercise
the Limited Stock Appreciation Right; and
(ii) agreeing in such written notice to the cancellation of
Options then outstanding to him for a number of Shares equal to the
number of Shares for which the Limited Stock Appreciation Right is
being exercised.
Except as provided in section 4.8(c), within ten (10) days after the giving of
such a notice, the Committee shall cause the Company to deliver to such Person a
monetary payment in an amount per Share equal to the amount by which the Change
in Control Consideration exceeds the Exercise Price per Share of each of the
Options being cancelled.
(b) For purposes of section 4.8(a), the term Change in Control
Consideration shall mean the greater of (i) the highest price per Share paid by
any Person who initiated or sought to effect the Change in Control for a Share
during the period of one (1) year ending on the date of the relevant Change in
Control of the Company; and (ii) the average Fair Market Value of a Share over
the last ten (10) trading days preceding the date of exercise of the Limited
Stock Appreciation Right.
(c) Notwithstanding anything herein contained to the contrary,
the Limited Stock Appreciation Rights granted hereunder shall be cancelled at
the effective time of a Change in Control of the Company resulting from a
transaction between the Company and another party pursuant to a written
agreement whereby the consummation of the transaction is conditioned upon the
delivery to each Option holder, upon the closing of such transaction and in
exchange for the cancellation of all of such Option holder's outstanding
Options, of a monetary payment or property with a value equivalent to the value
of the Options being cancelled.
SECTION 4.9 REQUIRED REGULATORY PROVISIONS.
Notwithstanding anything contained herein to the contrary:
(a) no Option shall be granted under the Plan prior to
the date on which the Plan is approved by the requisite vote of holders
of Shares;
(b) at any time prior to March 21, 1997, no individual
may be granted Options to purchase more than One Hundred Thousand Two
Hundred Seventy-Six (100,276) Shares;
(c) each Option granted prior to March 21, 1997 shall
become exercisable as follows:
(i) prior to the first anniversary of the date
on which the Option is granted, the Option shall not be
exercisable;
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(ii) on and after the first anniversary, but
prior to the second anniversary, of the date on which the
Option is granted, the Option may be exercised as to a maximum
of twenty percent (20%) of the Shares subject to the Option
when granted;
(iii) on and after the second anniversary, but
prior to the third anniversary, of the date on which the
Option is granted, the Option may be exercised as to a maximum
of forty percent (40%) of the Shares subject to the Option
when granted, including in such forty percent (40%) any
optioned Shares purchased prior to such second anniversary;
(iv) on and after the third anniversary, but
prior to the fourth anniversary, of the date on which the
Option is granted, the Option may be exercised as to a maximum
of sixty percent (60%) of the Shares subject to the Option
when granted, including in such sixty percent (60%) any
optioned Shares purchased prior to such third anniversary;
(v) on and after the fourth anniversary, but
prior to the fifth anniversary, of the date on which the
Option is granted, the Option may be exercised as to a maximum
of eighty percent (80%) of the Shares subject to the Option
when granted, including in such eighty percent (80%) any
optioned Shares purchased prior to such fourth anniversary;
and
(vi) on and after the fifth anniversary of the
date on which the Option is granted and for the remainder of
the Option Period, the Option may be exercised as to the
entire number of optioned Shares not theretofore purchased.
To the extent that any Option shall not have become exercisable prior
to the date on which the Option holder terminates Service with the
Company, such Option shall not thereafter become exercisable; PROVIDED,
HOWEVER, that such an Option shall become fully exercisable, and all
optioned Shares not previously purchased shall become available for
purchase, on the date of the Option holder's death or Disability; and
(d) The Exercise Period of any Option granted hereunder,
whether or not previously vested, shall be suspended as of the time and
date at which the Option holder has received notice from the Board that
his or her employment is subject to a possible Termination for Cause.
Such suspension shall remain in effect until the Option holder receives
official notice from the Board that he or she has been cleared of any
possible Termination for Cause, at which time, the original Exercise
Period shall be reinstated without any adjustment for the intervening
suspended period.
(e) No Option granted hereunder, whether or not previously
vested, shall be exercised after the time and date at which the Option
holder's employment with the Company is terminated in a Termination for
Cause.
ARTICLE V
AMENDMENT AND TERMINATION
SECTION 5.1 TERMINATION.
The Board may suspend or terminate the Plan in whole or in
part at any time prior to the tenth anniversary of the Effective Date by giving
written notice of such suspension or termination to the Committee Unless sooner
terminated, the Plan shall terminate automatically on the day preceding the
tenth anniversary of the Effective Date. In the event of any suspension or
termination of the Plan, all Options theretofore granted under the Plan that are
outstanding on the date of such suspension or termination of the Plan shall
remain outstanding and exercisable for the period and on the terms and
conditions set forth in the Option agreements evidencing such Options.
SECTION 5.2 AMENDMENT.
The Board may amend or revise the Plan in whole or in part at
any time; PROVIDED, HOWEVER, that if the amendment or revision:
(a) materially increases the benefits accruing under the
Plan;
(b) materially increases the number of Shares which may
be issued under the Plan; or
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(c) materially modifies the requirements as to
eligibility for Options under the Plan;
such amendment or revision shall be subject to approval by the shareholders of
the Company; AND PROVIDED, FURTHER, that (i) sections 4.1, 4.2, 4.3 and 4.4
shall not be amended more frequently than once in any period of six months and
(ii) no amendment required to comply with or conform to any condition imposed
under section 162(m) of the Code on federal income tax deductions allowable to
the Company in respect of the Plan shall require such approval.
SECTION 5.3 ADJUSTMENTS IN THE EVENT OF A BUSINESS
REORGANIZATION.
(a) In the event of any merger, consolidation, or other
business reorganization in which the Company is the surviving entity, and in the
event of any stock split, stock dividend or other event generally affecting the
number of Shares held by each Person who is then a holder of record of Shares,
the number of Shares covered by each outstanding Option and the number of Shares
available pursuant to section 4.2 shall be adjusted to account for such event.
Such adjustment shall be effected by multiplying such number of Shares by an
amount equal to the number of Shares that would be owned after such event by a
Person who, immediately prior to such event, was the holder of record of one
Share, and the Exercise Price of the Options shall be adjusted by dividing the
Exercise Price by such number of Shares; PROVIDED, HOWEVER, that the Committee
may, in its discretion, establish another appropriate method of adjustment.
(b) In the event of any merger, consolidation, or other
business reorganization in which the Company is not the surviving entity, any
Options granted under the Plan which remain outstanding may be cancelled as of
the effective date of such merger, consolidation, business reorganization,
liquidation or sale by the Committee upon 30 days' written notice to the Option
holder; PROVIDED, HOWEVER, that on or as soon as practicable following the date
of cancellation, each Option holder shall receive a monetary payment in such
amount, or other property of such kind and value, as the Committee determines in
good faith to be equivalent in value to the Options that have been cancelled.
(c) In the event that the Company shall declare and pay any
dividend with respect to Shares (other than a dividend payable in Shares or a
regular quarterly cash dividend), including a dividend which results in a
nontaxable return of capital to the holders of Shares for federal income tax
purposes, or otherwise than by dividend makes distribution of property to the
holders of its Shares, at the election of the Committee:
(i) the Company shall make an equivalent payment to each
Person holding an outstanding Option as of the record date for such
dividend. Such payment shall be made at substantially the same time, in
substantially the same form and in substantially the same amount per
optioned Share as the dividend or other distribution paid with respect
to outstanding Shares; PROVIDED, HOWEVER, that if any dividend or
distribution on outstanding Shares is paid in property other than cash,
the Company, in its discretion applied uniformly to all outstanding
Options, may make such payment in a cash amount per optioned Share
equal in fair market value to the fair market value of the non-cash
dividend or distribution; or
(ii) the Committee, in its discretion applied uniformly to all
outstanding Options, may adjust the Exercise Price per Share of
outstanding Options in such a manner as the Committee may determine to
be necessary to reflect the effect of the dividend or other
distribution on the Fair Market Value of a Share.
ARTICLE VI
MISCELLANEOUS
SECTION 6.1 STATUS AS AN EMPLOYEE BENEFIT PLAN.
This Plan is not intended to satisfy the requirements for
qualification under section 401(a) of the Code or to satisfy the definitional
requirements for an "employee benefit plan" under section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended. It is intended to be a
non-qualified incentive compensation program that is exempt from the regulatory
requirements of the Employee Retirement Income Security Act of 1974, as amended.
The Plan shall be construed and administered so as to effectuate this intent.
SECTION 6.2 NO RIGHT TO CONTINUED EMPLOYMENT.
Neither the establishment of the Plan nor any provisions of
the Plan nor any action of the Board or the Committee with respect to the Plan
shall be held or construed to confer upon any Eligible Individual any right to a
continuation of employment by the Company or upon any Eligible Director any
right to a continuation of his position as a director of the Company. The
Company reserves the right to dismiss any Eligible Individual or remove any
Eligible Director or otherwise deal with any Eligible Individual or Eligible
Director to the same extent as though the Plan had not been adopted.
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SECTION 6.3 CONSTRUCTION OF LANGUAGE.
Whenever appropriate in the Plan, words used in the singular
may be read in the plural, words used in the plural may be read in the singular,
and words importing the masculine gender may be read as referring equally to the
feminine or the neuter. Any reference to an Article or section number shall
refer to an Article or section of this Plan unless otherwise indicated.
SECTION 6.4 GOVERNING LAW.
The Plan shall be construed, administered and enforced
according to the laws of the State of Iowa without giving effect to the conflict
of laws principles thereof, except to the extent that such laws are preempted by
federal law.
SECTION 6.5 HEADINGS.
The headings of Articles and sections are included solely for
convenience of reference. If there is any conflict between such headings and the
text of the Plan, the text shall control.
SECTION 6.6 NON-ALIENATION OF BENEFITS.
The right to receive a benefit under the Plan shall not be
subject in any manner to anticipation, alienation or assignment, nor shall such
right be liable for or subject to debts, contracts, liabilities, engagements or
torts, except to the extent provided in a Qualified Domestic Relations Order.
SECTION 6.7 TAXES.
The Company shall have the right to deduct from all amounts
paid by the Company in cash with respect to an Option under the Plan any taxes
required by law to be withheld with respect to such Option. Where any Person is
entitled to receive Shares pursuant to the exercise of an Option, the Company
shall have the right to require such Person to pay the Company the amount of any
tax which the Company is required to withhold with respect to such Shares, or,
in lieu thereof, to retain, or to sell without notice, a sufficient number of
Shares to cover the amount required to be withheld.
SECTION 6.8 APPROVAL OF SHAREHOLDERS.
The Plan and all Options and Limited Stock Appreciation Rights
granted hereunder shall be conditioned on the approval of the Plan by the
holders of Shares of North Central Bancshares, Inc. at an annual or special
meeting of the holders of Shares held no earlier than September 21, 1996. No
Option or Limited Stock Appreciation Rights under the Plan shall be granted, nor
shall any such Option or Limited Stock Appreciation Rights be exercised or any
Shares issued or purchased, prior to such approval.
SECTION 6.9 NOTICES.
Any communication required or permitted to be given under the
Plan, including any notice, direction, designation, comment, instruction,
objection or waiver, shall be in writing and shall be deemed to have been given
at such time as it is delivered personally or five (5) days after mailing if
mailed, postage prepaid, by registered or certified mail, return receipt
requested, addressed to such party at the address listed below, or at such other
address as one such party may by written notice specify to the other party:
(a) If to the Committee:
North Central Bancshares, Inc.
825 Central Avenue
P.O. Box 1237
Fort Dodge, Iowa 50501
Attention: CORPORATE SECRETARY
(b) If to an Option holder, to the Option holder's
address as shown in the Company's personnel records.
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