<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
X Quarterly report under Section 13 or 15(d) of the Securities Exchange
- --- Act of 1934 For the quarterly period ended March 31, 1997
Transition report under Section 13 or 15(d) of the Exchange Act
- --- For the transition period from to
--------------- ----------------
Commission File No. 333-1546
FNB BANCSHARES, INC.
--------------------
(Exact Name of Small Business Issuer as Specified in its Charter)
South Carolina 57-1033165
-------------- ----------
(State of Incorporation) (I.R.S. Employer Identification No.)
Post Office Box 1539, Gaffney, South Carolina 29342
---------------------------------------------------
(Address of Principal Executive Offices)
(864) 488-2265
--------------
(Issuer's Telephone Number, Including Area Code)
Not Applicable
--------------
(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes X No
--- ---
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date:
616,338 shares of common stock, par value $.01 per share, were issued
and outstanding as of March 31, 1997.
Transitional Small Business Disclosure Format (check one):
Yes No X
--- ---
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FNB BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
MARCH 31, 1997 DECEMBER 31, 1996
(UNAUDITED) (AUDITED)
----------- ---------
<S> <C> <C>
ASSETS
Cash and Cash Equivalents:
Cash $ 675,770 $ 342,680
Federal Funds Sold 6,530,000 7,930,000
------------ ------------
7,205,770 8,272,680
Securities 1,349,855 344,190
Loans Receivable 5,905,371 2,043,972
Less Allowance for loan loss (50,000) (20,000)
------------ ------------
Loans, net 5,855,371 2,023,972
Premises and equipment 824,097 734,443
Accrued Interest Receivable 61,874 11,180
Other Assets 378,843 346,436
------------ ------------
Total Assets $ 15,675,810 $ 11,732,901
LIABILITIES
Deposits:
Non-interest bearing transaction accounts $ 1,672,592 $ 1,125,050
Interest bearing transaction accounts 2,006,641 1,234,402
Savings 1,680,785 550,717
Time deposits $100,000 and over 1,207,029 798,765
Other time deposits 2,617,468 2,095,431
------------ ------------
9,184,515 5,804,365
Repurchase Agreements 651,921 0
Accrued Interest Payable 59,325 20,213
Other Liabilities 24,675 13,997
------------ ------------
Total Liabilities 9,920,436 5,838,575
------------ ------------
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; 10,000,000
shares authorized and unissued
Common Stock, $.01 par value; 10,000,000
shares authorized; 616,338 shares issued 6,163 6,163
Capital surplus 6,112,318 6,112,318
Retained earnings (deficit) (363,107) (224,155)
------------ ------------
Total Stockholders' equity 5,755,374 5,894,326
------------ ------------
Total Liabilities and Stockholders' equity $ 15,675,810 $ 11,732,901
</TABLE>
See Accompanying Notes to Financial Statements
<PAGE> 3
PART I - FINANCIAL INFORMATION (continued)
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
FNB BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31
(UNAUDITED)
<TABLE>
<CAPTION>
1997 1996
-------- ---------
<S> <C> <C>
INTEREST INCOME
Loans, including fees $ 115,375 $ 0
Investment securities, taxable 12,398 0
Federal funds sold 89,123 0
------------ ------------
Total revenues 216,896 0
------------ ------------
INTEREST EXPENSE
Time deposits $100,000 and over 14,192 0
Other deposits 48,807 0
Repurchase agreements 4,878 0
Short term borrowings 0 3,372
------------ ------------
67,877 3,372
------------ ------------
NET INTEREST INCOME 149,019 (3,372)
Provision for loan loss 30,000 0
------------ ------------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 119,019
------------ ------------
(3,372)
OTHER INCOME
Service charges on deposit accounts 12,537 0
Other service charges, commissions and fees 10,882 0
------------ ------------
23,419 0
------------ ------------
OTHER EXPENSE
Salaries and employee benefits 161,162 19,622
Furniture and equipment 46,003 1,019
Other operating expense 74,225 49,594
------------ ------------
281,390 70,235
------------ ------------
INCOME (LOSS) BEFORE TAXES (138,952) (73,607)
INCOME TAX EXPENSE (BENEFIT) 0 0
------------ ------------
NET INCOME (LOSS) $ (138,952) $ (73,607)
PER SHARE
Average shares outstanding 616,338 --
Net income (loss) $ (.23) --
</TABLE>
See Accompanying Notes to Financial Statements
<PAGE> 4
PART I - FINANCIAL INFORMATION (CONTINUED)
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
FNB BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD ENDED MARCH 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
Retained
Common Stock Capital Earnings
Shares Amount Surplus (Deficit) Total
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCE, DECEMBER 31, 1996 616,338 $ 6,163 $ 6,112,318 $ (224,155) $ 5,894,326
Net income (loss) 0 0 0 (138,952) (138,952)
------- ----------- ----------- ----------- -----------
BALANCE, MARCH 31, 1997 616,338 $ 6,163 $ 6,112,318 $ (363,107) $ 5,755,374
</TABLE>
See Accompanying Notes to Financial Statements
<PAGE> 5
PART I - FINANCIAL INFORMATION (CONTINUED)
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
FNB BANCSHARES, INC.
UNAUDITED STATEMENTS OF CASH FLOWS
FROM DECEMBER 31 TO MARCH 31
<TABLE>
<CAPTION>
1997 1996
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (138,952) $ (73,607)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities
Provision for loan losses 30,000 0
Depreciation 20,901 0
Accretion and premium amortization (4,540) 0
Increase in interest receivable (50,694) 0
Increase in interest payable 39,112 0
Increase in other assets (32,407) 0
Increase in other liabilities 10,678 70,000
------------ ------------
Net cash used by operating activities (125,902) (3,607)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of securities held to maturity (1,001,125) 0
Net increase in loans made to customers (3,861,399) 0
Purchase of premises and equipment (110,555) (10,842)
------------ ------------
Net cash used by investing activities (4,973,079) (10,842)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in demand deposits, interest bearing
transaction accounts and savings accounts 793,201 0
Net increase in time deposits 2,586,949 0
Net increase(decrease) in Repurchase Agreements 651,921 0
------------ ------------
Net cash provided by financing activities 4,032,071 0
------------ ------------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (1,066,910) (14,449)
------------ ------------
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 8,272,680 18,898
------------ ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 7,205,770 $ 4,449
</TABLE>
See Accompanying Notes to Financial Statements
<PAGE> 6
PART I - FINANCIAL INFORMATION (CONTINUED)
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
FNB BANCSHARES, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION
ORGANIZATION AND CONSOLIDATION - FNB Bancshares, Inc. (the "Company") is a bank
holding company. Through its subsidiary, First National Bank of the Carolinas
(the "Bank"), the Company provides banking services to domestic markets
principally in Cherokee County, South Carolina. The Bank commenced operations on
October 18, 1996. The consolidated financial statements include the accounts of
the parent company and its wholly-owned subsidiary after elimination of all
significant intercompany balances and transactions.
BASIS OF PRESENTATION. The accompanying consolidated financial statements have
been prepared in accordance with the requirements for interim financial
statements and, accordingly, they are condensed and omit disclosures which would
substantially duplicate those contained in the most recent annual report to
shareholders. The financial statements for the interim periods ended March 31,
1996 and 1997 are unaudited and, in the opinion of management, include all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation. The financial information as of December 31, 1996 has been
derived from audited financial statements as of that date. For further
information, refer to the financial statements and the notes included in FNB
Bancshares, Inc.'s 1996 Annual Report.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
The following is a discussion of the Company's financial condition as of March
31, 1997 compared to December 31, 1996, and the results of operations for the
three months ended March 31, 1997 compared to the three months ended March 31,
1996. These comments should be read in conjunction with the Company's condensed
consolidated financial statements and accompanying footnotes appearing in this
report.
RESULTS OF OPERATIONS
The Company commenced operations on October 18, 1996. The 1996 expenses through
March 31, 1996 were a result of the start-up of the Company; therefore,
comparison of the 1996 to 1997 results is not meaningful.
Net Interest Income
Net interest income for the three month period ended March 31, 1997 was
$149,019. The interest rate spread was 3.75% at March 31, 1997.
Provision and Allowance for Loan Losses
The provision for loan losses is the charge to operating earnings that
management feels is necessary to maintain the allowance for possible loan losses
at an adequate level. For the three months ended March 31, 1997, the provision
charged to expense was $30,000. Based on present information, management
believes the allowance for loan losses is adequate at March 31, 1997 to meet
presently known and inherent risks in the loan portfolio.
<PAGE> 7
PART I - FINANCIAL INFORMATION (CONTINUED)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION (CONTINUED)
Non-Interest Income
Non-interest income for the three months ended March 31, 1997 was $23,419,
$12,537 of which was a result of deposit account service charges which include
NSF and account maintenance fees.
Non-Interest Expense
Non-interest expense for the three month period ended March 31, 1997 was
$281,390. Salaries and employee benefits comprise $161,162 of this amount.
Depreciation of furniture and equipment accounted for $20,901.
ASSETS AND LIABILITIES
During the first three months of 1997, total assets increased $3,942,909, or
34%, when compared to December 31, 1996. The primary growth in assets was in
loans with an increase of 189% since December 31, 1996. Total liabilities
increased $4,081,861, or 70%, when compared to December 31, 1996. Within the
deposit area, savings accounts increased 205% and interest bearing transaction
accounts increased 63%.
Loans
Balances within the major loan categories as of March 31, 1997 and December 31,
1996 are as follows:
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---- ----
<S> <C> <C>
Commercial and Industrial $ 3,339,094 $ 886,758
Real Estate 73,000 0
Consumer 953,048 523,005
Other, net 1,540,229 634,209
------------ ------------
$ 5,905,371 $ 2,043,972
Allowance for loan loss, December 31, 1996 $ 20,000
Provision 30,000
Charge-offs 0
Allowance for loan loss, March 31, 1997 $ 50,000
Gross loans outstanding, December 31, 1996 $ 2,043,972
Gross loans outstanding, March 31, 1997 $ 5,905,371
Allowance for loan losses to loans
outstanding, December 31, 1996 .98 %
---
Allowance for loan losses to loans
outstanding, March 31, 1997 .85 %
---
</TABLE>
Deposits
Balances within the major deposit categories as of March 31, 1997 and December
31, 1996 are as follows:
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
------------ --------------
<S> <C> <C>
Non-interest bearing demand deposits $ 1,672,592 $ 1,125,050
Interest bearing demand deposits 2,006,641 1,234,402
Savings deposits 1,680,785 550,717
Certificates of deposit 3,824,497 2,894,196
------------ ------------
$ 9,184,515 $ 5,804,365
</TABLE>
<PAGE> 8
PART I - FINANCIAL INFORMATION (CONTINUED)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION (CONTINUED)
Liquidity
Liquidity needs are met by the Company through scheduled maturities of loans and
investments on the asset side and through pricing policies on the liabilities
side for interest-bearing deposit accounts. The level of liquidity is measured
by the loan-to-total borrowed funds ratio which was 60% at March 31, 1997 and
35% at December 31, 1996.
Capital Resources
Total shareholders' equity decreased $138,952 to $5,755,374 at March 31, 1997.
The decrease is attributable to losses for the period.
Bank holding companies and their banking subsidiaries are required by banking
regulators to meet certain minimum levels of capital adequacy which are
expressed in the form of certain ratios. Capital is separated into Tier 1
capital (essentially common shareholders' equity less intangible assets) and
Tier 2 capital (essentially the allowance for loan losses limited to 1.25% of
risk weighted assets). The first two ratios, which are based on the degree of
credit risk in the Company's assets, require the weighting of assets based on
assigned risk factors and include off-balance sheet items such as loan
commitments and stand-by letters of credit. The ratio of Tier 1 capital to
risk-weighted assets must be at least 4% and the ratio of total capital (Tier 1
capital plus Tier 2) to risk-weighted assets must be at least 8%. The capital
leverage ratio supplements the risk-based capital guidelines. The leverage ratio
is Tier 1 capital divided by the adjusted quarterly average total assets. Banks
and bank holding companies are required to maintain a minimum leverage ratio of
3.0%.
The following table summarizes the Company's risk-based capital at March 31,
1997:
<TABLE>
<S> <C>
Shareholders' equity $ 5,755,374
Less: intangibles 179,797
-----------
Tier 1 capital $ 5,575,577
Plus: allowance for loan losses (1) 50,000
-----------
Total Capital $ 5,625,577
Risk-weighted assets $ 8,553,258
-----------
Risk based capital ratios
Tier 1 65.19%
Total capital 65.77%
Leverage ratio 41.15%
</TABLE>
(1) limited to 1.25% of risk-weighted assets
Regulatory Matters
The management of the Company is not aware of any current recommendations by
regulatory authorities which, if they were to be implemented, would have a
material effect on liquidity, capital resources, or operations.
<PAGE> 9
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not Applicable
ITEM 2. CHANGES IN SECURITIES
Not Applicable
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On April 22, 1997, the Company held its Annual Meeting of Shareholders for the
purpose of (a) electing three directors for three-year terms, and (b) approving
the Stock Option Plan.
Each nominee for director received the number of affirmative votes of
shareholders required for such nominee's election in accordance with the Bylaws
of the Company, with 356,677 shares voting for each nominee and 4,200 shares
withholding vote out of a total 616,338 outstanding shares. The three nominees
elected at the meeting were Richard D. Gardner, Harold D. Pennington, Sr., and
Heyward W. Porter. The other directors of the Company are Barry L. Hamrick,
Haskell D. Mallory, Bill H. Mason, V. Stephen Moss, and Harold D. Pennington,
Jr. The Stock Option Plan also received the requisite number of affirmative
votes required for approval pursuant to the Bylaws of the Company. Of the
616,338 outstanding shares of the Company, the voting was as follows: 327,547
shares voted for, 26,450 voted against, and 6,880 abstained.
ITEM 5. OTHER INFORMATION
Not Applicable
ITEM 6. EXHIBITS AND REPORT ON FORM 8-K
(a) Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
3.1 Articles of Incorporation of the Company (incorporated by reference to
Exhibit 3.1 of the Registration Statement on Form S-1, File No.
333-1546)
3.2 Bylaws of the Company (incorporated by reference to Exhibit 3.2 of the
Registration Statement on Form S-1, File No. 333-1546)
4.1 Provisions in the Company's Articles of Incorporation and Bylaws
defining the rights of holders of the Company's Common Stock
(incorporated by reference to Exhibit 4.1 of the Registration Statement
on Form S-1, File No. 333-1546)
10.1 Option Agreement dated October 20, 1995, between James L. Moss, as
seller, and FNB Bancshares, Inc., as purchaser, for the Blacksburg
Office property (incorporated by reference to Exhibit 10.1 of the
Registration Statement on Form S-1, File No. 333-1546)
</TABLE>
<PAGE> 10
<TABLE>
<S> <C>
10.2 Option Agreement dated December 31, 1995, between William K. Brumbach,
Jr., Linwood B. Brumbach, Evelyn B. Sanles and Patricia Brumbach Clary,
as sellers, and FNB Bancshares, Inc., as purchaser, for the secondary
parcel for the Gaffney Office property (incorporated by reference to
Exhibit 10.2 of the Registration Statement on Form S-1, File No.
333-1546)
10.3 Option Agreement dated January 10, 1996, between Wylie L. Hamrick and
Catherine H. Beattie, as sellers, and FNB Bancshares, Inc., as
purchaser, for the primary parcel for the Gaffney Office property
(incorporated by reference to Exhibit 10.3 of the Registration
Statement on Form S-1, File No. 333-1546)
10.4 Line of Credit Note dated September 27, 1995, by The Company to The
Bankers Bank (incorporated by reference to Exhibit 10.4 of the
Registration Statement on Form S-1, File No. 333-1546)
10.5. Employment Agreement dated January 17, 1996, between the Company and V.
Stephen Moss (incorporated by reference to Exhibit 10.5 of the
Registration Statement on Form S-1, File No. 333-1546)
10.6. Escrow Agreement dated March 8, 1996, between The Company and The
Bankers Bank (incorporated by reference to Exhibit 10.6 of the
Registration Statement on Form S-1, File No. 333-1546)
10.7 Commitment Letter dated March 27, 1996, from Spartanburg National Bank
for a $150,000 line of credit (incorporated by reference to Exhibit
10.7 of the Registration Statement on Form S-1, File No. 333-1546)
10.8 Stock Option Plan dated as of March 25, 1997
21.1 Subsidiaries of the Company (incorporated by reference to Exhibit 10.8
of the Form 10-KSB for the period ending December 31, 1996, File No.
333-1546)
27.1 Financial Data Schedule (For SEC use only)
</TABLE>
(b) Reports on Form 8-K - No reports on Form 8-K were filed during the
quarter ended March 31, 1997
<PAGE> 11
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
FNB BANCSHARES, INC.
--------------------
(Registrant)
Date: May 7, 1997 By: /s/ V. Stephen Moss
------------------------------------
V. Stephen Moss
President and Chief Executive Officer
<PAGE> 1
EXHIBIT 10.8
FNB BANCSHARES, INC.
1997 STOCK OPTION PLAN
<PAGE> 2
FNB BANCSHARES, INC.
1997 STOCK OPTION PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE I
DEFINITIONS..................................................................................................... 1
ARTICLE II
THE PLAN........................................................................................................ 5
2.1 Name.......................................................................................... 5
2.2 Purpose....................................................................................... 5
2.3 Effective Date................................................................................ 5
ARTICLE III
PARTICIPANTS.................................................................................................... 5
ARTICLE IV
ADMINISTRATION.................................................................................................. 5
4.1 Duties and Powers of the Committee............................................................ 5
4.2 Interpretation; Rules......................................................................... 6
4.3 No Liability.................................................................................. 6
4.4 Majority Rule................................................................................. 6
4.5 Company Assistance............................................................................ 6
ARTICLE V
SHARES OF STOCK SUBJECT TO PLAN................................................................................. 6
5.1 Limitations................................................................................... 6
5.2 Antidilution.................................................................................. 7
ARTICLE VI
OPTIONS......................................................................................................... 8
6.1 Types of Options Granted...................................................................... 8
6.2 Option Grant and Agreement.................................................................... 8
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C> <C> <C>
6.3 Optionee Limitations.......................................................................... 9
6.4 $100,000 Limitation........................................................................... 9
6.5 Exercise Price................................................................................ 9
6.6 Exercise Period............................................................................... 10
6.7 Option Exercise............................................................................... 10
6.8 Reload Options................................................................................ 11
6.9 Nontransferability of Option.................................................................. 11
6.10 Termination of Employment or Service.......................................................... 11
6.11 Employment Rights............................................................................. 12
6.12 Certain Successor Options..................................................................... 12
6.13 Effect of Change in Control................................................................... 12
ARTICLE VII
RESTRICTED STOCK................................................................................................ 12
7.1 Awards of Restricted Stock.................................................................... 12
7.2 Non-Transferability........................................................................... 13
7.3 Lapse of Restrictions......................................................................... 13
7.4 Termination of Employment..................................................................... 13
7.5 Treatment of Dividends........................................................................ 13
7.6 Delivery of Shares............................................................................ 13
ARTICLE VIII
STOCK APPRECIATION RIGHTS....................................................................................... 13
8.1 SAR Grants.................................................................................... 13
8.2 Determination of Price........................................................................ 14
8.3 Exercise of a SAR............................................................................. 14
8.4 Payment for a SAR............................................................................. 14
8.5 Status of a SAR under the Plan................................................................ 14
8.6 Termination of SARs........................................................................... 14
8.7 No Shareholder Rights......................................................................... 15
ARTICLE IX
STOCK CERTIFICATES.............................................................................................. 15
ARTICLE X
TERMINATION AND AMENDMENT....................................................................................... 16
10.1 Termination and Amendment..................................................................... 16
10.2 Effect on Grantee's Rights.................................................................... 16
</TABLE>
ii
<PAGE> 4
<TABLE>
<S> <C>
ARTICLE XI
RELATIONSHIP TO OTHER COMPENSATION PLANS........................................................................ 16
ARTICLE XII
MISCELLANEOUS................................................................................................... 16
12.1 Replacement or Amended Grants................................................................. 16
12.2 Forfeiture for Competition.................................................................... 16
12.3 Plan Binding on Successors.................................................................... 16
12.4 Singular, Plural; Gender...................................................................... 16
12.5 Headings, etc., No Part of Plan............................................................... 17
12.6 Interpretation................................................................................ 17
Exhibit A....................................................................................................... i
SCHEDULE A...................................................................................................... vi
SCHEDULE B......................................................................................................vii
</TABLE>
iii
<PAGE> 5
FNB BANCSHARES, INC.
1997 STOCK OPTION PLAN
ARTICLE I
DEFINITIONS
As used herein, the following terms have the following meanings unless
the context clearly indicates to the contrary:
"Award" shall mean a grant of Restricted Stock or an SAR.
"Board" shall mean the Board of Directors of the Company.
"Cause" shall mean theft or destruction of property of the
Company, a Parent, or a Subsidiary, disregard of Company
rules or policies, or conduct evincing willful or wanton
disregard of the interests of the Company. Such determination
shall be made by the Committee based on information presented
by the Company and the Employee and shall be final and
binding on all parties hereto.
"Change in Control" shall mean the occurrence of either of
the following events:
(i) A change in the composition of the Board of
Directors as a result of which fewer than one-half
of the incumbent directors are directors who either:
(A) Had been directors of the Company 24 months
prior to such change; or
(B) Were elected, or nominated for election, to
the Board of Directors with the affirmative
votes of at least a majority of the
directors who had been directors of the
Company 24 months prior to such change and
who were still in office at the time of the
election or nomination; or
<PAGE> 6
(ii) Any "person" (as such term is used in sections 13(d)
and 14(d) of the Exchange Act), other than any
person who is a shareholder of the Company on or
before the effective date of the Plan, by the
acquisition or aggregation of securities is or
becomes the beneficial owner, directly or
indirectly, of securities of the Company
representing 50 percent or more of the combined
voting power of the Company's then outstanding
securities ordinarily (and apart from rights
accruing under special circumstances) having the
right to vote at elections of directors (the "Base
Capital Stock"); except that any change in the
relative beneficial ownership of the Company's
securities by any person resulting solely from a
reduction in the aggregate number of outstanding
shares of Base Capital Stock, and any decrease
thereafter in such person's ownership of securities,
shall be disregarded until such person increases in
any manner, directly or indirectly, such person's
beneficial ownership of any securities of the
Company.
"Code" shall mean the United States Internal Revenue Code of
1986, including effective date and transition rules (whether
or not codified). Any reference herein to a specific section
of the Code shall be deemed to include a reference to any
corresponding provision of future law.
"Committee" shall mean a committee of at least two Directors
appointed from time to time by the Board, having the duties
and authority set forth herein in addition to any other
authority granted by the Board; provided, however, that with
respect to any Options or Awards granted to an individual who
is also a Section 16 Insider, the Committee shall consist of
either the entire Board of Directors or a committee of at
least two Directors (who need not be members of the Committee
with respect to Options or Awards granted to any other
individuals) who are Non-Employee Directors, and all
authority and discretion shall be exercised by such
Non-Employee Directors, and references herein to the
"Committee" shall mean such Non-Employee Directors insofar as
any actions or determinations of the Committee shall relate
to or affect Options or Awards made to or held by any Section
16 Insider. At any time that the Board shall not have
appointed a committee as described above, any reference
herein to the Committee shall mean a reference to the Board.
"Company" shall mean FNB Bancshares, Inc., a South Carolina
corporation.
"Director" shall mean a member of the Board and any person
who is an advisory or honorary director of the Company if
such person is considered a director for the purposes of
Section 16 of the Exchange Act, as determined by reference to
such Section 16 and to the rules, regulations, judicial
decisions, and interpretative or "no-action" positions with
respect thereto of the Securities and Exchange Commission, as
the same may be in effect or set forth from time to time.
"Employee" shall mean an employee of the Employer.
2
<PAGE> 7
"Employer" shall mean the corporation that employs a Grantee.
"Exchange Act" shall mean the Securities Exchange Act of
1934. Any reference herein to a specific section of the
Exchange Act shall be deemed to include a reference to any
corresponding provision of future law.
"Exercise Price" shall mean the price at which an Optionee
may purchase a share of Stock under a Stock Option Agreement.
"Fair Market Value" on any date shall mean (i) the closing
sales price of the Stock, regular way, on such date on the
national securities exchange having the greatest volume of
trading in the Stock during the thirty-day period preceding
the day the value is to be determined or, if such exchange
was not open for trading on such date, the next preceding
date on which it was open; (ii) if the Stock is not traded on
any national securities exchange, the average of the closing
high bid and low asked prices of the Stock on the
over-the-counter market on the day such value is to be
determined, or in the absence of closing bids on such day,
the closing bids on the next preceding day on which there
were bids; or (iii) if the Stock also is not traded on the
over-the-counter market, the fair market value as determined
in good faith by the Board or the Committee based on such
relevant facts as may be available to the Board, which may
include opinions of independent experts, the price at which
recent sales have been made, the book value of the Stock, and
the Company's current and future earnings.
"Grantee" shall mean a person who is an Optionee or a person
who has received an Award of Restricted Stock or an SAR.
"Incentive Stock Option" shall mean an option to purchase any
stock of the Company, which complies with and is subject to
the terms, limitations and conditions of Section 422 of the
Code and any regulations promulgated with respect thereto.
"Non-Employee Director" shall have the meaning set forth in
Rule 16b-3 under the Exchange Act, as the same may be in
effect from time to time, or in any successor rule thereto,
and shall be determined for all purposes under the Plan
according to interpretative or "no-action" positions with
respect thereto issued by the Securities and Exchange
Commission.
"Officer" shall mean a person who constitutes an officer of
the Company for the purposes of Section 16 of the Exchange
Act, as determined by reference to such Section 16 and to the
rules, regulations, judicial decisions, and interpretative or
"no-action" positions with respect thereto of the Securities
and Exchange Commission, as the same may be in effect or set
forth from time to time.
"Option" shall mean an option, whether or not an Incentive
Stock Option, to
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purchase Stock granted pursuant to the provisions of Article
VI hereof.
"Optionee" shall mean a person to whom an Option has been
granted hereunder.
"Parent" shall mean any corporation (other than the Employer)
in an unbroken chain of corporations ending with the Employer
if, at the time of the grant (or modification) of the Option,
each of the corporations other than the Employer owns stock
possessing 50 percent or more of the total combined voting
power of the classes of stock in one of the other
corporations in such chain.
"Permanent and Total Disability" shall have the same meaning
as given to that term by Code Section 22(e)(3) and any
regulations or rulings promulgated thereunder.
"Plan" shall mean the FNB Bancshares, Inc. 1997 Stock Option
Plan, the terms of which are set forth herein.
"Purchasable" shall refer to Stock which may be purchased by
an Optionee under the terms of this Plan on or after a
certain date specified in the applicable Stock Option
Agreement.
"Qualified Domestic Relations Order" shall have the meaning
set forth in the Code or in the Employee Retirement Income
Security Act of 1974, or the rules and regulations
promulgated under the Code or such Act.
"Reload Option" shall have the meaning set forth in Section
6.8 hereof.
"Restricted Stock" shall mean Stock issued, subject to
restrictions, to a Grantee pursuant to Article VII hereof.
"Restriction Agreement" shall mean the agreement setting
forth the terms of an Award, and executed by a Grantee as
provided in Section 7.1 hereof.
"SAR" means a stock appreciation right, which is the right to
receive an amount equal to the appreciation, if any, in the
Fair Market Value of a share of Stock from the date of the
grant of the right to the date of its payment, all as
provided in Article VIII hereof.
"SAR Price" means the base value established by the Committee
for a SAR on the date the SAR is granted and which is used in
determining the amount of benefit, if any, paid to a Grantee.
"Section 16 Insider" shall mean any person who is subject to
the provisions of Section 16 of the Exchange Act, as provided
in Rule 16a-2 promulgated pursuant to the Exchange Act.
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"Stock" shall mean the Common Stock, par value $1.00 per
share, of the Company or, in the event that the outstanding
shares of Stock are hereafter changed into or exchanged for
shares of a different stock or securities of the Company or
some other entity, such other stock or securities.
"Stock Option Agreement" shall mean an agreement between the
Company and an Optionee under which the Optionee may purchase
Stock hereunder, a sample form of which is attached hereto as
Exhibit A (which form may be varied by the Committee in
granting an Option).
"Subsidiary" shall mean any corporation (other than the
Employer) in an unbroken chain of corporations beginning with
the Employer if, at the time of the grant (or modification)
of the Option, each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50
percent or more of the total combined voting power of all
classes of stock in one of the other corporations in such
chain.
ARTICLE II
THE PLAN
2.1 Name. This Plan shall be known as "FNB Bancshares, Inc. 1997
Stock Option Plan."
2.2 Purpose. The purpose of the Plan is to advance the interests
of the Company, its Subsidiaries and its shareholders by affording certain
employees and Directors of the Company and its Subsidiaries, as well as key
consultants and advisors to the Company or any Subsidiary, an opportunity to
acquire or increase their proprietary interests in the Company. The objective
of the issuance of the Options and Awards is to promote the growth and
profitability of the Company and its Subsidiaries because the Grantees will be
provided with an additional incentive to achieve the Company's objectives
through participation in its success and growth and by encouraging their
continued association with or service to the Company.
2.3 Effective Date. The Plan shall become effective on March 25,
1997; provided, however, that if the shareholders of the Company have not
approved the Plan on or prior to the first anniversary of such effective date,
then all options granted under the Plan shall be non-Incentive Stock Options.
ARTICLE III
PARTICIPANTS
The class of persons eligible to participate in the Plan shall consist
of all persons whose participation in the Plan the Committee determines to be
in the best interests of the Company which shall include, but not be limited
to, all Directors and employees, including but not limited to executive
personnel, of the Company or any Subsidiary, as well as key consultants and
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advisors to the Company or any Subsidiary.
ARTICLE IV
ADMINISTRATION
4.1 Duties and Powers of the Committee. The Plan shall be administered
by the Committee. The Committee shall select one of its members as its Chairman
and shall hold its meetings at such times and places as it may determine. The
Committee shall keep minutes of its meetings and shall make such rules and
regulations for the conduct of its business as it may deem necessary. The
Committee shall have the power to act by unanimous written consent in lieu of a
meeting, and to meet telephonically. In administering the Plan, the Committee's
actions and determinations shall be binding on all interested parties. The
Committee shall have the power to grant Options or Awards in accordance with
the provisions of the Plan and may grant Options and Awards singly, in
combination, or in tandem. Subject to the provisions of the Plan, the Committee
shall have the discretion and authority to determine those individuals to whom
Options or Awards will be granted and whether such Options shall be accompanied
by the right to receive Reload Options, the number of shares of Stock subject
to each Option or Award, such other matters as are specified herein, and any
other terms and conditions of a Stock Option Agreement or Restriction
Agreement. The Committee shall also have the discretion and authority to
delegate to any Officer its powers to grant Options or Awards under the Plan to
any person who is an employee of the Company but not an Officer or Director. To
the extent not inconsistent with the provisions of the Plan, the Committee may
give a Grantee an election to surrender an Option or Award in exchange for the
grant of a new Option or Award, and shall have the authority to amend or modify
an outstanding Stock Option Agreement or Restriction Agreement, or to waive any
provision thereof, provided that the Grantee consents to such action.
4.2 Interpretation; Rules. Subject to the express provisions of the
Plan, the Committee also shall have complete authority to interpret the Plan,
to prescribe, amend, and rescind rules and regulations relating to it, to
determine the details and provisions of each Stock Option Agreement, and to
make all other determinations necessary or advisable for the administration of
the Plan, including, without limitation, the amending or altering of the Plan
and any Options or Awards granted hereunder as may be required to comply with
or to conform to any federal, state, or local laws or regulations.
4.3 No Liability. Neither any member of the Board nor any member of
the Committee shall be liable to any person for any act or determination made
in good faith with respect to the Plan or any Option or Award granted
hereunder.
4.4 Majority Rule. A majority of the members of the Committee shall
constitute a quorum, and any action taken by a majority at a meeting at which a
quorum is present, or any action taken without a meeting evidenced by a writing
executed by all the members of the Committee, shall constitute the action of
the Committee.
4.5 Company Assistance. The Company shall supply full and timely
information to the Committee on all matters relating to eligible persons, their
employment, death, retirement,
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disability, or other termination of employment, and such other pertinent facts
as the Committee may require. The Company shall furnish the Committee with such
clerical and other assistance as is necessary in the performance of its duties.
ARTICLE V
SHARES OF STOCK SUBJECT TO PLAN
5.1 Limitations. Subject to any antidilution adjustment pursuant to
the provisions of Section 5.2 hereof, the maximum number of shares of Stock
that may be issued hereunder shall be 92,451. Any or all shares of Stock
subject to the Plan may be issued in any combination of Incentive Stock
Options, non-Incentive Stock Options, Restricted Stock, or SARs, and the amount
of Stock subject to the Plan may be increased from time to time in accordance
with Article X, provided that the total number of shares of Stock issuable
pursuant to Incentive Stock Options may not be increased to more than 92,451
(other than pursuant to anti-dilution adjustments) without shareholder
approval. Shares subject to an Option or issued as an Award may be either
authorized and unissued shares or shares issued and later acquired by the
Company. The shares covered by any unexercised portion of an Option that has
terminated for any reason (except as set forth in the following paragraph), or
any forfeited portion of an Award, may again be optioned or awarded under the
Plan, and such shares shall not be considered as having been optioned or issued
in computing the number of shares of Stock remaining available for option or
award hereunder.
If Options are issued in respect of options to acquire stock of any
entity acquired, by merger or otherwise, by the Company (or any Subsidiary of
the Company), to the extent that such issuance shall not be inconsistent with
the terms, limitations and conditions of Code section 422 or Rule 16b-3 under
the Exchange Act, the aggregate number of shares of Stock for which Options may
be granted hereunder shall automatically be increased by the number of shares
subject to the Options so issued; provided, however, that the aggregate number
of shares of Stock for which Options may be granted hereunder shall
automatically be decreased by the number of shares covered by any unexercised
portion of an Option so issued that has terminated for any reason, and the
shares subject to any such unexercised portion may not be optioned to any other
person.
5.2 Antidilution.
(a) If (x) the outstanding shares of Stock are changed into
or exchanged for a different number or kind of shares or other securities of
the Company by reason of merger, consolidation, reorganization,
recapitalization, reclassification, combination or exchange of shares, or stock
split or stock dividend, (y) any spin-off, spin-out or other distribution of
assets materially affects the price of the Company's stock, or (z) there is any
assumption and conversion to the Plan by the Company of an acquired company's
outstanding option grants, then:
(i) the aggregate number and kind of shares of Stock
for which Options or Awards may be granted hereunder shall be
adjusted proportionately by the Committee; and
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(ii) the rights of Optionees (concerning the number
of shares subject to Options and the Exercise Price) under
outstanding Options and the rights of the holders of Awards
(concerning the terms and conditions of the lapse of any
then-remaining restrictions), shall be adjusted
proportionately by the Committee.
(b) If the Company shall be a party to any reorganization in
which it does not survive, involving merger, consolidation, or acquisition of
the stock or substantially all the assets of the Company, the Committee, in its
discretion, may:
(i) notwithstanding other provisions hereof, declare
that all Options granted under the Plan shall become
exercisable immediately notwithstanding the provisions of the
respective Stock Option Agreements regarding exercisability,
that all such Options shall terminate 30 days after the
Committee gives written notice of the immediate right to
exercise all such Options and of the decision to terminate
all Options not exercised within such 30-day period, and that
all then-remaining restrictions pertaining to Awards under
the Plan shall immediately lapse; and/or
(ii) notify all Grantees that all Options or Awards
granted under the Plan shall be assumed by the successor
corporation or substituted on an equitable basis with options
or restricted stock issued by such successor corporation.
(c) If the Company is to be liquidated or dissolved in
connection with a reorganization described in Section 5.2(b), the provisions of
such Section shall apply. In all other instances, the adoption of a plan of
dissolution or liquidation of the Company shall, notwithstanding other
provisions hereof, cause all then-remaining restrictions pertaining to Awards
under the Plan to lapse, and shall cause every Option outstanding under the
Plan to terminate to the extent not exercised prior to the adoption of the plan
of dissolution or liquidation by the shareholders, provided that,
notwithstanding other provisions hereof, the Committee may declare all Options
granted under the Plan to be exercisable at any time on or before the fifth
business day following such adoption notwithstanding the provisions of the
respective Stock Option Agreements regarding exercisability.
(d) The adjustments described in paragraphs (a) through (c)
of this Section 5.2, and the manner of their application, shall be determined
solely by the Committee, and any such adjustment may provide for the
elimination of fractional share interests; provided, however, that any
adjustment made by the Board or the Committee shall be made in a manner that
will not cause an Incentive Stock Option to be other than an Incentive Stock
Option under applicable statutory and regulatory provisions. The adjustments
required under this Article V shall apply to any successors of the Company and
shall be made regardless of the number or type of successive events requiring
such adjustments.
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ARTICLE VI
OPTIONS
6.1 Types of Options Granted. The Committee may, under this Plan,
grant either Incentive Stock Options or Options which do not qualify as
Incentive Stock Options. Within the limitations provided in this Plan, both
types of Options may be granted to the same person at the same time, or at
different times, under different terms and conditions, as long as the terms and
conditions of each Option are consistent with the provisions of the Plan.
Without limitation of the foregoing, Options may be granted subject to
conditions based on the financial performance of the Company or any other
factor the Committee deems relevant.
6.2 Option Grant and Agreement. Each Option granted hereunder shall be
evidenced by minutes of a meeting or the written consent of the Committee and
by a written Stock Option Agreement executed by the Company and the Optionee.
The terms of the Option, including the Option's duration, time or times of
exercise, exercise price, whether the Option is intended to be an Incentive
Stock Option, and whether the Option is to be accompanied by the right to
receive a Reload Option, shall be stated in the Stock Option Agreement. No
Incentive Stock Option may be granted more than ten years after the earlier to
occur of the effective date of the Plan or the date the Plan is approved by the
Company's shareholders.
Separate Stock Option Agreements may be used for Options intended to
be Incentive Stock Options and those not so intended, but any failure to use
such separate agreements shall not invalidate, or otherwise adversely affect
the Optionee's interest in, the Options evidenced thereby.
6.3 Optionee Limitations. The Committee shall not grant an Incentive
Stock Option to any person who, at the time the Incentive Stock Option is
granted:
(a) is not an employee of the Company or any of its
Subsidiaries; or
(b) owns or is considered to own stock possessing at least
10% of the total combined voting power of all classes of stock of the Company
or any of its Parent or Subsidiary corporations; provided, however, that this
limitation shall not apply if at the time an Incentive Stock Option is granted
the Exercise Price is at least 110% of the Fair Market Value of the Stock
subject to such Option and such Option by its terms would not be exercisable
after five years from the date on which the Option is granted. For the purpose
of this subsection (b), a person shall be considered to own: (i) the stock
owned, directly or indirectly, by or for his or her brothers and sisters
(whether by whole or half blood), spouse, ancestors and lineal descendants;
(ii) the stock owned, directly or indirectly, by or for a corporation,
partnership, estate, or trust in proportion to such person's stock interest,
partnership interest or beneficial interest therein; and (iii) the stock which
such person may purchase under any outstanding options of the Employer or of
any Parent or Subsidiary of the Employer.
6.4 $100,000 Limitation. Except as provided below, the Committee shall
not grant an Incentive Stock Option to, or modify the exercise provisions of
outstanding Incentive Stock Options held by, any person who, at the time the
Incentive Stock Option is granted (or modified),
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would thereby receive or hold any Incentive Stock Options of the Employer and
any Parent or Subsidiary of the Employer, such that the aggregate Fair Market
Value (determined as of the respective dates of grant or modification of each
option) of the stock with respect to which such Incentive Stock Options are
exercisable for the first time during any calendar year is in excess of
$100,000 (or such other limit as may be prescribed by the Code from time to
time); provided that the foregoing restriction on modification of outstanding
Incentive Stock Options shall not preclude the Committee from modifying an
outstanding Incentive Stock Option if, as a result of such modification and
with the consent of the Optionee, such Option no longer constitutes an
Incentive Stock Option; and provided that, if the $100,000 limitation (or such
other limitation prescribed by the Code) described in this Section 6.4 is
exceeded, the Incentive Stock Option, the granting or modification of which
resulted in the exceeding of such limit, shall be treated as an Incentive Stock
Option up to the limitation and the excess shall be treated as an Option not
qualifying as an Incentive Stock Option.
6.5 Exercise Price. The Exercise Price of the Stock subject to each
Option shall be determined by the Committee. Subject to the provisions of
Section 6.3(b) hereof, the Exercise Price of an Incentive Stock Option shall
not be less than the Fair Market Value of the Stock as of the date the Option
is granted (or in the case of an Incentive Stock Option that is subsequently
modified, on the date of such modification).
6.6 Exercise Period. The period for the exercise of each Option
granted hereunder shall be determined by the Committee, but the Stock Option
Agreement with respect to each Option intended to be an Incentive Stock Option
shall provide that such Option shall not be exercisable after the expiration of
ten years from the date of grant (or modification) of the Option.
6.7 Option Exercise.
(a) Unless otherwise provided in the Stock Option Agreement
or Section 6.6 hereof, an Option may be exercised at any time or from time to
time during the term of the Option as to any or all full shares which have
become Purchasable under the provisions of the Option, but not at any time as
to less than 100 shares unless the remaining shares that have become so
Purchasable are less than 100 shares. The Committee shall have the authority to
prescribe in any Stock Option Agreement that the Option may be exercised only
in accordance with a vesting schedule during the term of the Option.
(b) An Option shall be exercised by (i) delivery to the Company at
its principal office a written notice of exercise with respect to a specified
number of shares of Stock and (ii) payment to the Company at that office of the
full amount of the Exercise Price for such number of shares in accordance with
Section 6.7(c). If requested by an Optionee, an Option may be exercised with
the involvement of a stockbroker in accordance with the federal margin rules
set forth in Regulation T (in which case the certificates representing the
underlying shares will be delivered by the Company directly to the
stockbroker).
(c) The Exercise Price is to be paid in full in cash upon the
exercise of the Option and the Company shall not be required to deliver
certificates for the shares purchased
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until such payment has been made; provided, however, that in lieu of cash, all
or any portion of the Exercise Price may be paid by tendering to the Company
shares of Stock duly endorsed for transfer and owned by the Optionee, or by
authorization to the Company to withhold shares of Stock otherwise issuable
upon exercise of the Option, in each case to be credited against the Exercise
Price at the Fair Market Value of such shares on the date of exercise (however,
no fractional shares may be so transferred, and the Company shall not be
obligated to make any cash payments in consideration of any excess of the
aggregate Fair Market Value of shares transferred over the aggregate Exercise
Price); provided further, that the Board may provide in a Stock Option
Agreement (or may otherwise determine in its sole discretion at the time of
exercise) that, in lieu of cash or shares, all or a portion of the Exercise
Price may be paid by the Optionee's execution of a recourse note equal to the
Exercise Price or relevant portion thereof, subject to compliance with
applicable state and federal laws, rules and regulations.
(d) In addition to and at the time of payment of the Exercise
Price, the Optionee shall pay to the Company in cash the full amount of any
federal, state, and local income, employment, or other withholding taxes
applicable to the taxable income of such Optionee resulting from such exercise;
provided, however, that in the discretion of the Committee any Stock Option
Agreement may provide that all or any portion of such tax obligations, together
with additional taxes not exceeding the actual additional taxes to be owed by
the Optionee as a result of such exercise, may, upon the irrevocable election
of the Optionee, be paid by tendering to the Company whole shares of Stock duly
endorsed for transfer and owned by the Optionee, or by authorization to the
Company to withhold shares of Stock otherwise issuable upon exercise of the
Option, in either case in that number of shares having a Fair Market Value on
the date of exercise equal to the amount of such taxes thereby being paid, and
subject to such restrictions as to the approval and timing of any such election
as the Committee may from time to time determine to be necessary or appropriate
to satisfy the conditions of the exemption set forth in Rule 16b-3 under the
Exchange Act, if such rule is applicable.
(e) The holder of an Option shall not have any of the rights
of a shareholder with respect to the shares of Stock subject to the Option
until such shares have been issued and transferred to the Optionee upon the
exercise of the Option.
6.8 Reload Options.
(a) The Committee may specify in a Stock Option Agreement (or may
otherwise determine in its sole discretion) that a Reload Option shall be
granted, without further action of the Committee, (i) to an Optionee who
exercises an Option (including a Reload Option) by surrendering shares of Stock
in payment of amounts specified in Sections 6.7(c) or 6.7(d) hereof, (ii) for
the same number of shares as are surrendered to pay such amounts, (iii) as of
the date of such payment and at an Exercise Price equal to the Fair Market
Value of the Stock on such date, and (iv) otherwise on the same terms and
conditions as the Option whose exercise has occasioned such payment, except as
provided below and subject to such other contingencies, conditions, or other
terms as the Committee shall specify at the time such exercised Option is
granted; provided, that the shares surrendered in payment as provided above
must have been held by the Optionee for at least six months prior to such
surrender.
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(b) Unless provided otherwise in the Stock Option Agreement, a Reload
Option may not be exercised by an Optionee (i) prior to the end of a one-year
period from the date that the Reload Option is granted, and (ii) unless the
Optionee retains beneficial ownership of the shares of Stock issued to such
Optionee upon exercise of the Option referred to above in Section 6.8(a)(i) for
a period of one year from the date of such exercise.
6.9 Nontransferability of Option. No Option shall be transferable by
an Optionee other than by will or the laws of descent and distribution or, in
the case of non-Incentive Stock Options, pursuant to a Qualified Domestic
Relations Order. During the lifetime of an Optionee, Options shall be
exercisable only by such Optionee (or by such Optionee's guardian or legal
representative, should one be appointed).
6.10 Termination of Employment or Service. The Committee shall have
the power to specify, with respect to the Options granted to a particular
Optionee, the effect upon such Optionee's right to exercise an Option of
termination of such Optionee's employment or service under various
circumstances, which effect may include immediate or deferred termination of
such Optionee's rights under an Option, or acceleration of the date at which an
Option may be exercised in full; provided, however, that in no event may an
Incentive Stock Option be exercised after the expiration of ten years from the
date of grant thereof.
6.11 Employment Rights. Nothing in the Plan or in any Stock Option
Agreement shall confer on any person any right to continue in the employ of the
Company or any of its Subsidiaries, or shall interfere in any way with the
right of the Company or any of its Subsidiaries to terminate such person's
employment at any time.
6.12 Certain Successor Options. To the extent not inconsistent with
the terms, limitations and conditions of Code section 422 and any regulations
promulgated with respect thereto, an Option issued in respect of an option held
by an employee to acquire stock of any entity acquired, by merger or otherwise,
by the Company (or any Subsidiary of the Company) may contain terms that differ
from those stated in this Article VI, but solely to the extent necessary to
preserve for any such employee the rights and benefits contained in such
predecessor option, or to satisfy the requirements of Code section 424(a).
6.13 Effect of Change in Control. The Committee may determine, at the
time of granting an Option or thereafter, that such Option shall become
exercisable on an accelerated basis in the event that a Change in Control
occurs with respect to the Company (and the Committee shall have the discretion
to modify the definition of a Change in Control in a particular Option
Agreement). If the Committee finds that there is a reasonable possibility that,
within the succeeding six months, a Change in Control will occur with respect
to the Company, then the Committee may determine that all outstanding Options
shall be exercisable on an accelerated basis.
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ARTICLE VII
RESTRICTED STOCK
7.1 Awards of Restricted Stock. The Committee may grant Awards of
Restricted Stock, which shall be governed by a Restriction Agreement between
the Company and the Grantee. Each Restriction Agreement shall contain such
restrictions, terms, and conditions as the Committee may, in its discretion,
determine, and may require that an appropriate legend be placed on the
certificates evidencing the subject Restricted Stock.
Shares of Restricted Stock granted pursuant to an Award hereunder
shall be issued in the name of the Grantee as soon as reasonably practicable
after the Award is granted, provided that the Grantee has executed the
Restriction Agreement governing the Award, the appropriate blank stock powers
and, in the discretion of the Committee, an escrow agreement and any other
documents which the Committee may require as a condition to the issuance of
such Shares. If a Grantee shall fail to execute the foregoing documents within
any time period prescribed by the Committee, the Award shall be void. At the
discretion of the Committee, Shares issued in connection with an Award shall be
deposited together with the stock powers with an escrow agent designated by the
Committee. Unless the Committee determines otherwise and as set forth in the
Restriction Agreement, upon delivery of the Shares to the escrow agent, the
Grantee shall have all of the rights of a shareholder with respect to such
Shares, including the right to vote the Shares and to receive all dividends or
other distributions paid or made with respect to the Shares.
7.2 Non-Transferability. Until any restrictions upon Restricted Stock
awarded to a Grantee shall have lapsed in a manner set forth in Section 7.3,
such shares of Restricted Stock shall not be transferable other than by will or
the laws of descent and distribution, or pursuant to a Qualified Domestic
Relations Order, nor shall they be delivered to the Grantee.
7.3 Lapse of Restrictions. Restrictions upon Restricted Stock awarded
hereunder shall lapse at such time or times (but, with respect to any award to
a Grantee who is also a Section 16 Insider, not less than six months after the
date of the Award) and on such terms and conditions as the Committee may, in
its discretion, determine at the time the Award is granted or thereafter.
7.4 Termination of Employment. The Committee shall have the power to
specify, with respect to each Award granted to any particular Grantee, the
effect upon such Grantee's rights with respect to such Restricted Stock of the
termination of such Grantee's employment under various circumstances, which
effect may include immediate or deferred forfeiture of such Restricted Stock or
acceleration of the date at which any then-remaining restrictions shall lapse.
7.5 Treatment of Dividends. At the time an Award of Restricted Stock
is made the Committee may, in its discretion, determine that the payment to the
Grantee of any dividends, or a specified portion thereof, declared or paid on
such Restricted Stock shall be (i) deferred until the lapsing of the relevant
restrictions and (ii) held by the Company for the account of the Grantee until
such lapsing. In the event of such deferral, there shall be credited at the end
of each year (or portion thereof) interest on the amount of the account at the
beginning of the year at a rate per annum determined by the Committee. Payment
of deferred dividends, together with
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interest thereon, shall be made upon the lapsing of restrictions imposed on
such Restricted Stock, and any dividends deferred (together with any interest
thereon) in respect of Restricted Stock shall be forfeited upon any forfeiture
of such Restricted Stock.
7.6 Delivery of Shares. Except as provided otherwise in Article IX
below, within a reasonable period of time following the lapse of the
restrictions on shares of Restricted Stock, the Committee shall cause a stock
certificate to be delivered to the Grantee with respect to such shares and such
shares shall be free of all restrictions hereunder.
ARTICLE VIII
STOCK APPRECIATION RIGHTS
8.1 SAR Grants. The Committee, in its sole discretion, may grant to
any Grantee a SAR. The Committee may impose such conditions or restrictions on
the exercise of any SAR as it may deem appropriate, including, without
limitation, restricting the time of exercise of the SAR to specified periods as
may be necessary to satisfy the requirements of Rule 16b-3.
8.2 Determination of Price. The SAR Price shall be established by the
Committee in its sole discretion. The SAR Price shall not be less than 100% of
Fair Market Value of the Stock on the date the SAR is granted for a SAR issued
in tandem with an Incentive Stock Option.
8.3 Exercise of a SAR. Upon exercise of a SAR, the Grantee shall be
entitled, subject to the terms and conditions of this Plan and the Agreement,
to receive the excess for each share of Stock being exercised under the SAR of
(i) the Fair Market Value of such share of Stock on the date of exercise over
(ii) the SAR Price for such share of Stock.
8.4 Payment for a SAR. At the sole discretion of the Committee, the
payment of such excess shall be made in (i) cash, (ii) shares of Stock, or
(iii) a combination of both. Shares of Stock used for this payment shall be
valued at their Fair Market Value on the date of exercise of the applicable
SAR.
8.5 Status of a SAR under the Plan. Shares of Stock subject to an
Award of a SAR shall be considered shares of Stock which may be issued under
the Plan for purposes of Section 5.1 hereof, unless the Agreement making the
Award of the SAR provides that the exercise of such SAR results in the
termination of an unexercised Option for the same number of shares of Stock.
8.6 Termination of SARs. A SAR may be terminated as follows:
(a) During the period of continuous employment with the
Company, Parent or Subsidiary, a SAR will be terminated only if it has
been fully exercised or it has expired by its terms.
(b) Upon termination of employment, the SAR will terminate
upon the
14
<PAGE> 19
earliest of (i) the full exercise of the SAR, (ii) the expiration of
the SAR by its terms, and (iii) not more than three months following
the date of employment termination; provided, however, should
termination of employment (A) result from the death or Permanent and
Total Disability of the Grantee, the period referenced in clause (iii)
hereof shall be one year or (B) be for Cause, the SAR will terminate
on the date of employment termination. For purposes of the Plan, a
leave of absence approved by the Company shall not be deemed to be
termination of employment unless otherwise provided in the Agreement
or by the Company on the date of the leave of absence.
(c) Subject to the terms of the Agreement with the Grantee,
if a Grantee shall die or become subject to a Permanent and Total
Disability prior to the termination of employment with the Company,
Parent or Subsidiary and prior to the termination of a SAR, such SAR
may be exercised to the extent that the Grantee shall have been
entitled to exercise it at the time of death or disability, as the
case may be, by the Grantee, the estate of the Grantee or the person
or persons to whom the SAR may have been transferred by will or by the
laws of descent and distribution.
(d) Except as otherwise expressly provided in the Agreement
with the Grantee, in no event will the continuation of the term of a
SAR beyond the date of termination of employment allow the Employee,
or his beneficiaries or heirs, to accrue additional rights under the
Plan, have additional SARs available for exercise, or receive a higher
benefit than the benefit payable as if the SAR had been exercised on
the date of employment termination.
8.7 No Shareholder Rights. The Grantee shall have no rights as a
shareholder with respect to a SAR. In addition, no adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, securities or other
property) or distributions or rights except as provided in Section 5.2 hereof.
ARTICLE IX
STOCK CERTIFICATES
The Company shall not be required to issue or deliver any certificate
for shares of Stock purchased upon the exercise of any Option granted hereunder
or any portion thereof, or deliver any certificate for shares of Restricted
Stock granted hereunder, prior to fulfillment of all of the following
conditions:
(a) The admission of such shares to listing on all stock exchanges on
which the Stock is then listed;
(b) The completion of any registration or other qualification of such
shares which the Committee shall deem necessary or advisable under any federal
or state law or under the rulings or regulations of the Securities and Exchange
Commission or any other governmental regulatory body;
15
<PAGE> 20
(c) The obtaining of any approval or other clearance from any federal
or state governmental agency or body which the Committee shall determine to be
necessary or advisable; and
(d) The lapse of such reasonable period of time following the exercise
of the Option as the Board from time to time may establish for reasons of
administrative convenience.
Stock certificates issued and delivered to Grantees shall bear such
restrictive legends as the Company shall deem necessary or advisable pursuant
to applicable federal and state securities laws.
ARTICLE X
TERMINATION AND AMENDMENT
10.1 Termination and Amendment. The Board may at any time terminate
the Plan; provided, however, that the Board (unless its actions are approved or
ratified by the shareholders of the Company within twelve months of the date
that the Board amends the Plan) may not amend the Plan to:
(a) Increase the total number of shares of Stock issuable
pursuant to Incentive Stock Options under the Plan, except as contemplated in
Section 5.2 hereof; or
(b) Change the class of employees eligible to receive Incentive
Stock Options that may participate in the Plan.
10.2 Effect on Grantee's Rights. No termination, amendment, or
modification of the Plan shall affect adversely a Grantee's rights under a
Stock Option Agreement or Restriction Agreement without the consent of the
Grantee or his legal representative.
ARTICLE XI
RELATIONSHIP TO OTHER COMPENSATION PLANS
The adoption of the Plan shall not affect any other stock option,
incentive, or other compensation plans in effect for the Company or any of its
Subsidiaries; nor shall the adoption of the Plan preclude the Company or any of
its Subsidiaries from establishing any other form of incentive or other
compensation plan for employees or Directors of the Company or any of its
Subsidiaries.
16
<PAGE> 21
ARTICLE XII
MISCELLANEOUS
12.1 Replacement or Amended Grants. At the sole discretion of the
Committee, and subject to the terms of the Plan, the Committee may modify
outstanding Options or Awards or accept the surrender of outstanding Options or
Awards and grant new Options or Awards in substitution for them. However no
modification of an Option or Award shall adversely affect a Grantee's rights
under a Stock Option Agreement or Restriction Agreement without the consent of
the Grantee or his legal representative.
12.2 Forfeiture for Competition. If a Grantee provides services to a
competitor of the Company or any of its Subsidiaries, whether as an employee,
officer, director, independent contractor, consultant, agent, or otherwise,
such services being of a nature that can reasonably be expected to involve the
skills and experience used or developed by the Grantee while an Employee, then
that Grantee's rights under any Options outstanding hereunder shall be
forfeited and terminated, and any shares of Restricted Stock held by such
Grantee subject to remaining restrictions shall be forfeited, subject in each
case to a determination to the contrary by the Committee.
12.3 Plan Binding on Successors. The Plan shall be binding upon the
successors and assigns of the Company.
12.4 Singular, Plural; Gender. Whenever used herein, nouns in the
singular shall include the plural, and the masculine pronoun shall include the
feminine gender.
12.5 Headings, etc., No Part of Plan. Headings of Articles and
Sections hereof are inserted for convenience and reference; they do not
constitute part of the Plan.
12.6 Interpretation. With respect to Section 16 Insiders, transactions
under this Plan are intended to comply with all applicable conditions of Rule
16b-3 or its successors under the Exchange Act. To the extent any provision of
the Plan or action by the Plan administrators fails to so comply, it shall be
deemed void to the extent permitted by law and deemed advisable by the Plan
administrators.
* * * * *
17
<PAGE> 22
Exhibit A to
FNB Bancshares, Inc.
1997 Stock Option Plan -
Form of Stock Option Agreement
FNB BANCSHARES, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this "Agreement"), entered into as of
this day of , , by and between FNB Bancshares, Inc., a South Carolina
corporation (the "Company"), and _________________ (the "Optionee").
WHEREAS, on March 25, 1997, the Board of Directors of the Company
adopted a stock option plan known as the "FNB Bancshares, Inc. 1997 Stock
Option Plan" (the "Plan"), and recommended that the Plan be approved by the
Company's shareholders; and
WHEREAS, the Committee has granted the Optionee a stock option to
purchase the number of shares of the Company's common stock as set forth below,
and in consideration of the granting of that stock option the Optionee intends
to remain in the employ of the Company; and
WHEREAS, the Company and the Optionee desire to enter into a written
agreement with respect to such option in accordance with the Plan.
NOW, THEREFORE, as an employment incentive and to encourage stock
ownership, and also in consideration of the mutual covenants contained herein,
the parties hereto agree as follows.
1. Incorporation of Plan. This option is granted pursuant to the
provisions of the Plan and the terms and definitions of the Plan are
incorporated herein by reference and made a part hereof. A copy of the Plan has
been delivered to, and receipt is hereby acknowledged by, the Optionee.
2. Grant of Option. Subject to the terms, restrictions, limitations
and conditions stated herein, the Company hereby evidences its grant to the
Optionee, not in lieu of salary or other compensation, of the right and option
(the "Option") to purchase all or any part of the number of shares of the
Company's Common Stock, par value $1.00 per share (the "Stock"), set forth on
Schedule A attached hereto and incorporated herein by reference. The Option
shall be exercisable in the amounts and at the time specified on Schedule A.
The Option shall expire and shall not be exercisable on the date specified on
Schedule A or on such earlier date as determined pursuant to Section 8, 9, or
10 hereof. Schedule A states whether the Option is intended to be an Incentive
Stock Option.
i
<PAGE> 23
3. Purchase Price. The price per share to be paid by the Optionee for
the shares subject to this Option (the "Exercise Price") shall be as specified
on Schedule A, which price shall be an amount not less than the Fair Market
Value of a share of Stock as of the Date of Grant (as defined in Section 11
below) if the Option is an Incentive Stock Option.
4. Exercise Terms. The Optionee must exercise the Option for at least
the lesser of 100 shares or the number of shares of Purchasable Stock as to
which the Option remains unexercised. In the event this Option is not exercised
with respect to all or any part of the shares subject to this Option prior to
its expiration, the shares with respect to which this Option was not exercised
shall no longer be subject to this Option.
5. Option Non-Transferable. No Option shall be transferable by an
Optionee other than by will or the laws of descent and distribution or, in the
case of non-Incentive Stock Options, pursuant to a Qualified Domestic Relations
Order. During the lifetime of an Optionee, Options shall be exercisable only by
such Optionee (or by such Optionee's guardian or legal representative, should
one be appointed).
6. Notice of Exercise of Option. This Option may be exercised by the
Optionee, or by the Optionee's administrators, executors or personal
representatives, by a written notice (in substantially the form of the Notice
of Exercise attached hereto as Schedule B) signed by the Optionee, or by such
administrators, executors or personal representatives, and delivered or mailed
to the Company as specified in Section 14 hereof to the attention of the
President or such other officer as the Company may designate. Any such notice
shall (a) specify the number of shares of Stock which the Optionee or the
Optionee's administrators, executors or personal representatives, as the case
may be, then elects to purchase hereunder, (b) contain such information as may
be reasonably required pursuant to Section 12 hereof, and (c) be accompanied by
(i) a certified or cashier's check payable to the Company in payment of the
total Exercise Price applicable to such shares as provided herein, (ii) shares
of Stock owned by the Optionee and duly endorsed or accompanied by stock
transfer powers having a Fair Market Value equal to the total Exercise Price
applicable to such shares purchased hereunder, or (iii) a certified or
cashier's check accompanied by the number of shares of Stock whose Fair Market
Value when added to the amount of the check equals the total Exercise Price
applicable to such shares purchased hereunder. Upon receipt of any such notice
and accompanying payment, and subject to the terms hereof, the Company agrees
to issue to the Optionee or the Optionee's administrators, executors or
personal representatives, as the case may be, stock certificates for the number
of shares specified in such notice registered in the name of the person
exercising this Option.
7. Adjustment in Option. The number of Shares subject to this Option,
the Exercise Price and other matters are subject to adjustment during the term
of this Option in accordance with Section 5.2 of the Plan.
ii
<PAGE> 24
8. Termination of Employment.
(a) Except as otherwise specified in Schedule A hereto, in the event
of the termination of the Optionee's employment with the Company or any of its
Subsidiaries, other than a termination that is either (i) for cause, (ii)
voluntary on the part of the Optionee and without written consent of the
Company, or (iii) for reasons of death or disability or retirement, the
Optionee may exercise this Option at any time within 30 days after such
termination to the extent of the number of shares which were Purchasable
hereunder at the date of such termination.
(b) Except as specified in Schedule A attached hereto, in the event of
a termination of the Optionee's employment that is either (i) for cause or (ii)
voluntary on the part of the Optionee and without the written consent of the
Company, this Option, to the extent not previously exercised, shall terminate
immediately and shall not thereafter be or become exercisable.
(c) Unless and to the extent otherwise provided in Exhibit A hereto,
in the event of the retirement of the Optionee at the normal retirement date as
prescribed from time to time by the Company or any Subsidiary, the Optionee
shall continue to have the right to exercise any Options for shares which were
Purchasable at the date of the Optionee's retirement provided that, on the date
which is three months after the date of retirement, the Options will become
void and unexercisable unless on the date of retirement the Optionee enters
into a noncompete agreement with FNB Bancshares, Inc. and continues to comply
with such noncompete agreement. This Option does not confer upon the Optionee
any right with respect to continuance of employment by the Company or by any of
its Subsidiaries. This Option shall not be affected by any change of employment
so long as the Optionee continues to be an employee of the Company or one of
its Subsidiaries.
9. Disabled Optionee. In the event of termination of employment
because of the Optionee's becoming a Disabled Optionee, the Optionee (or his or
her personal representative) may exercise this Option, within a period ending
on the earlier of (a) the last day of the one year period following the
Optionee's death or (b) the expiration date of this Option, to the extent of
the number of shares which were Purchasable hereunder at the date of such
termination.
iii
<PAGE> 25
10. Death of Optionee. Except as otherwise set forth in Schedule A
with respect to the rights of the Optionee upon termination of employment under
Section 8(a) above, in the event of the Optionee's death while employed by the
Company or any of its Subsidiaries or within three months after a termination
of such employment (if such termination was neither (i) for cause nor (ii)
voluntary on the part of the Optionee and without the written consent of the
Company), the appropriate persons described in Section 6 hereof or persons to
whom all or a portion of this Option is transferred in accordance with Section
5 hereof may exercise this Option at any time within a period ending on the
earlier of (a) the last day of the one year period following the Optionee's
death or (b) the expiration date of this Option. If the Optionee was an
employee of the Company at the time of death, this Option may be so exercised
to the extent of the number of shares that were Purchasable hereunder at the
date of death. If the Optionee's employment terminated prior to his or her
death, this Option may be exercised only to the extent of the number of shares
covered by this Option which were Purchasable hereunder at the date of such
termination.
11. Date of Grant. This Option was granted by the Board of Directors
of the Company on the date set forth in Schedule A (the "Date of Grant").
12. Compliance with Regulatory Matters. The Optionee acknowledges that
the issuance of capital stock of the Company is subject to limitations imposed
by federal and state law and the Optionee hereby agrees that the Company shall
not be obligated to issue any shares of Stock upon exercise of this Option that
would cause the Company to violate law or any rule, regulation, order or
consent decree of any regulatory authority (including without limitation the
Securities and Exchange Commission) having jurisdiction over the affairs of the
Company. The Optionee agrees that he or she will provide the Company with such
information as is reasonably requested by the Company or its counsel to
determine whether the issuance of Stock complies with the provisions described
by this Section 12.
13. Restriction on Disposition of Shares. The shares purchased
pursuant to the exercise of an Incentive Stock Option shall not be transferred
by the Optionee except pursuant to the Optionee's will, or the laws of descent
and distribution, until such date which is the later of two years after the
grant of such Incentive Stock Option or one year after the transfer of the
shares to the Optionee pursuant to the exercise of such Incentive Stock Option.
14. Miscellaneous.
(a) This Agreement shall be binding upon the parties hereto and their
representatives, successors and assigns.
(b) This Agreement is executed and delivered in, and shall be governed
by the laws of, the State of South Carolina.
(c) Any requests or notices to be given hereunder shall be deemed
given, and any elections or exercises to be made or accomplished shall be
deemed made or accomplished, upon actual delivery thereof to the designated
recipient, or three days after deposit thereof in the United States mail,
registered, return receipt requested and postage prepaid, addressed, if
iv
<PAGE> 26
to the Optionee, at the address set forth below and, if to the Company, to the
executive offices of the Company at 303 North Granard Street, Gaffney, South
Carolina 29342.
(d) This Agreement may not be modified except in writing executed by
each of the parties hereto.
IN WITNESS WHEREOF, the Board of Directors of the Company has caused
this Stock Option Agreement to be executed on behalf of the Company and the
Company's seal to be affixed hereto and attested by the Secretary or an
Assistant Secretary of the Company, and the Optionee has executed this Stock
Option Agreement under seal, all as of the day and year first above written.
FNB BANCSHARES, INC. OPTIONEE
By:
------------------- ------------------------
Name: Name:
Title: Address:
ATTEST:
------------------
------------------
- -----------------------
Secretary/Assistant Secretary
[SEAL]
v
<PAGE> 27
SCHEDULE A
TO
STOCK OPTION AGREEMENT
BETWEEN
FNB BANCSHARES, INC.
AND
_________________________
Dated:_____________
1. Number of Shares Subject to Option: _______________ Shares.
2. This Option (Check one) [ ] is [ ] is not an Incentive Stock Option.
3. Option Exercise Price: $_____________ per Share.
4. Date of Grant: _______________________
5. Option Vesting Schedule:
Check one:
( ) Options are exercisable with respect to all shares
on or after the date hereof
( ) Options are exercisable with respect to the number
of shares indicated below on or after the date
indicated next to the number of shares:
No. of Shares Vesting Date
6. Option Exercise Period:
Check One:
( ) All options expire and are void unless exercised
on or before _______, 19 .
( ) Options expire and are void unless exercised on or
before the date indicated next to the number of
shares:
No. of Shares Expiration Date
7. Effect of Termination of Employment of Optionee (if different from
that set forth in Sections 8 and 10 of the Stock Option Agreement):
<PAGE> 28
SCHEDULE B
NOTICE OF EXERCISE
The undersigned hereby notifies FNB Bancshares, Inc. (the
"Company") of this election to exercise the undersigned's stock option to
purchase ___________ shares of the Company's common stock, par value $1.00 per
share (the "Common Stock"), pursuant to the Stock Option Agreement (the
"Agreement") between the undersigned and the Company dated . Accompanying this
Notice is (1) a certified or a cashier's check in the amount of $ payable to
the Company, and/or (2) _______________ shares of the Company's Common Stock
presently owned by the undersigned and duly endorsed or accompanied by stock
transfer powers, having an aggregate Fair Market Value (as defined in the First
Bancshares, Inc. 1997 Stock Option Plan) as of the date hereof of
$__________________, such amounts being equal, in the aggregate, to the
purchase price per share set forth in Section 3 of the Agreement multiplied by
the number of shares being purchased hereby (in each instance subject to
appropriate adjustment pursuant to Section 5.2 of the Agreement).
IN WITNESS WHEREOF, the undersigned has set his hand and seal,
this day of _________, 19____.
OPTIONEE [OR OPTIONEE'S
ADMINISTRATOR,
EXECUTOR OR PERSONAL
REPRESENTATIVE]
--------------------------
Name:
Position (if other than Optionee):
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 675,770
<INT-BEARING-DEPOSITS> 2,006,641
<FED-FUNDS-SOLD> 6,530,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 1,349,855
<INVESTMENTS-MARKET> 1,349,855
<LOANS> 5,905,371
<ALLOWANCE> (50,000)
<TOTAL-ASSETS> 15,675,810
<DEPOSITS> 9,184,515
<SHORT-TERM> 711,246
<LIABILITIES-OTHER> 24,675
<LONG-TERM> 0
0
0
<COMMON> 6,163
<OTHER-SE> 5,749,211
<TOTAL-LIABILITIES-AND-EQUITY> 15,675,810
<INTEREST-LOAN> 115,375
<INTEREST-INVEST> 12,398
<INTEREST-OTHER> 89,123
<INTEREST-TOTAL> 216,896
<INTEREST-DEPOSIT> 62,999
<INTEREST-EXPENSE> 67,877
<INTEREST-INCOME-NET> 149,019
<LOAN-LOSSES> 30,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 281,390
<INCOME-PRETAX> (138,952)
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (138,952)
<EPS-PRIMARY> (.23)
<EPS-DILUTED> 0
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 20,000
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 50,000
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 50,000
</TABLE>
