SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
[ X ] Filed by the registrant
[ ] 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))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
ALGIERS BANCORP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
<PAGE>
June 18, 1997
Dear Stockholder:
You are cordially invited to attend a Special Meeting of Stockholders
of Algiers Bancorp, Inc. The meeting will be held at the Company's main office
located at 1 Westbank Expressway, Algiers, Louisiana on Friday, July 18, 1997 at
10:00 a.m., Central Time. The matters to be considered by stockholders at the
Special Meeting are described in the accompanying materials.
The Board of Directors of Algiers Bancorp, Inc. has determined that the
matters to be considered at the Special Meeting are in the best interests of the
Company and its shareholders. For the reasons set forth in the Proxy Statement,
the Board unanimously recommends that you vote "FOR" each matter to be
considered.
It is very important that your shares be voted at the Special Meeting
regardless of the number you own or whether you are able to attend the meeting
in person. We urge you to mark, sign, and date your proxy card today and return
it in the envelope provided, even if you plan to attend the Special Meeting.
This will not prevent you from voting in person, but will ensure that your vote
is counted if you are unable to attend.
On behalf of the Board of Directors and all of the employees of the
Company, I thank you for your continued interest and support.
Sincerely,
/s/Hugh E. Humphrey, Jr.
------------------------
Hugh E. Humphrey, Jr.
President and Chief Executive Officer
<PAGE>
Algiers Bancorp, Inc.
1 Westbank Expressway
Algiers, Louisiana 70114
(504) 367-8221
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To Be Held on July 18, 1997
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders ("Special
Meeting") of Algiers Bancorp, Inc. (the "Company") will be held at the Company's
main office located at 1 Westbank Expressway, Algiers, Louisiana on Friday, July
18, 1997 at 10:00 a.m., Central Time, for the following purposes, all of which
are more completely set forth in the accompanying Proxy Statement:
(1) To consider and approve the adoption of the Company's 1997
Stock Option Plan;
(2) To consider and approve the adoption of the Company's 1997
Recognition and Retention Plan and Trust Agreement; and
(3) To transact such other business as may properly come before
the meeting or any adjournment thereof. Management is not
aware of any other such business.
The Board of Directors has fixed June 12, 1997 as the voting record
date for the determination of stockholders entitled to notice of and to vote at
the Special Meeting and at any adjournment thereof. Only those stockholders of
record as of the close of business on that date will be entitled to vote at the
Special Meeting or at any such adjournment.
By Order of the Board of Directors
/s/Hugh E. Humphrey, III
------------------------
Hugh E. Humphrey, III
Secretary
Algiers, Louisiana
June 18, 1997
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YOU ARE CORDIALLY INVITED TO ATTEND THE SPECIAL MEETING. IT IS
IMPORTANT THAT YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN
IF YOU PLAN TO BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE
ENCLOSED PROXY PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING, YOU
MAY VOTE EITHER IN PERSON OR BY PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN
WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
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<PAGE>
ALGIERS BANCORP, INC.
PROXY STATEMENT
SPECIAL MEETING OF STOCKHOLDERS
July 18, 1997
This Proxy Statement is furnished to holders of common stock, par value
$.01 per share ("Common Stock"), of Algiers Bancorp, Inc. (the "Company"). The
Company acquired all of the stock of Algiers Homestead Association (the
"Association") issued in connection with the Association's conversion from
mutual to stock form in July 1996 (the "Conversion"). Proxies are being
solicited on behalf of the Board of Directors of the Company to be used at the
Special Meeting of Stockholders ("Special Meeting") to be held at the Company's
main office located at 1 Westbank Expressway, Algiers, Louisiana, on Friday,
July 18, 1997 at 10:00 a.m., Central Time, and at any adjournment thereof for
the purposes set forth in the Notice of Special Meeting of Stockholders. This
Proxy Statement is first being mailed to stockholders on or about June 18, 1997.
The proxy solicited hereby, if properly signed and returned to the
Company and not revoked prior to its use, will be voted in accordance with the
instructions contained therein. If no contrary instructions are given, each
proxy received will be voted FOR the matters described below and upon the
transaction of such other business as may properly come before the meeting in
accordance with the best judgment of the persons appointed as proxies. Any
stockholder giving a proxy has the power to revoke it at any time before it is
exercised by (i) filing with the Secretary of the Company written notice thereof
(Hugh E. Humphrey, III, Secretary, Algiers Bancorp, Inc., 1 Westbank Expressway,
Algiers, Louisiana 70114); (ii) submitting a duly executed proxy bearing a later
date; or (iii) appearing at the Special Meeting and giving the Secretary notice
of his or her intention to vote in person. Proxies solicited hereby may be
exercised only at the Special Meeting and any adjournment thereof and will not
be used for any other meeting.
VOTING
Only stockholders of record of the Company at the close of business on
June 18, 1997 ("Voting Record Date") are entitled to notice of and to vote at
the Special Meeting and at any adjournment thereof. On the Voting Record Date,
there were 615,624 shares of Common Stock of the Company issued and outstanding
and the Company had no other class of equity securities outstanding. A quorum
consists of stockholders representing, either in person or by proxy, a majority
of the outstanding Common Stock entitled to vote at the meeting. Abstentions are
considered in determining the presence of a quorum. Each share of Common Stock
is entitled to one vote at the Special Meeting on all matters properly presented
at the Special Meeting. The affirmative vote of the holders of a majority of the
total votes present in person or by proxy at the Special Meeting is required for
approval of the proposals to approve the Company's 1997 Stock Option Plan
("Stock Option Plan") and the Company's 1997 Recognition and Retention Plan and
Trust ("Recognition Plan"). Because of the required votes, abstentions will have
the same effect as a vote against the proposals with respect to the Stock Option
Plan and the Recognition Plan. The proposals to approve the Stock Option Plan
<PAGE>
and the Recognition Plan are considered "non-discretionary" for which brokers
may not vote if they have not received instructions from the beneficial owner.
Because all of the proposals at the Special Meeting are non-discretionary, there
will be no "broker non-votes" at the Special Meeting.
BENEFICIAL OWNERSHIP OF COMMON STOCK
BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of the Voting Record Date, certain
information as to the Common Stock beneficially owned by (i) each person or
entity, including any "group" as that term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934 ("1934 Act"), who or which was known to the
Company to be the beneficial owner of more than 5% of the issued and outstanding
Common Stock, (ii) the directors of the Company, and (iii) all directors and
executive officers of the Company and the Association as a group.
<TABLE>
<CAPTION>
Common Stock
Beneficially Owned as of
Name of Beneficial Owner June 18, 1997(1)
- ------------------------ ----------------
Amount %
------ -
<S> <C> <C>
Algiers Bancorp, Inc. 51,842(2) 8.42%
Employee Stock Ownership Trust
1 Westbank Expressway
Algiers, Louisiana 70114
Jerome H. and Susan B. Davis 60,200(3) 9.78%
11 Baldwin Farms North
Greenwich, Connecticut 06831
Wellington Management Company, LLP 64,100(4) 10.41%
75 State Street
Boston, Massachusetts 02109
Directors:
Hugh E. Humphrey, Jr. 24,770(5)(6) 4.02%
Thu Dang 2,500(3) *
John H. Gary, III 15,000(3) 2.44%
Hugh E. Humphrey, III 4,225(6)(7) *
Thomas L. Arnold 100 *
All directors and executive officers of the Company and 55,212(2)(6) 8.97%
the Association as a group (six persons)
- ---------------
* Represents less than 1% of the outstanding Common Stock.
(1) Based upon information provided by the respective beneficial owners and
filings with the Securities and Exchange Commission ("SEC") made
pursuant to the 1934 Act. For purposes of this table, pursuant to rules
promulgated under the 1934 Act, an individual is considered to
(Footnotes continued on following page)
<PAGE>
beneficially own shares of Common Stock if he or she directly or
indirectly has or shares (1) voting power, which includes the power to
vote or to direct the voting of the shares; or (2) investment power,
which includes the power to dispose or direct the disposition of the
shares. Unless otherwise indicated, an individual has sole voting power
and sole investment power with respect to the indicated shares.
Excludes shares which will be subject to stock options and Recognition
Plan awards if the Stock Option Plan and Recognition Plan are approved
by stockholders at the Special Meeting.
(2) The Algiers Bancorp, Inc. Employee Stock Ownership Trust ("Trust") was
established pursuant to the Algiers Bancorp, Inc. Employee Stock
Ownership Plan ("ESOP") by an agreement between the Company and Messrs.
Humphrey III, Dang and McCluer, who act as trustees of the plan
("Trustees"). As of the Voting Record Date, 2,592 shares held in the
Trust had been allocated to the accounts of participating employees and
49,250 shares held in the Trust were unallocated. Under the terms of
the ESOP, the Trustees must vote the allocated shares held in the ESOP
in accordance with the instructions of the participating employees.
Unallocated shares held in the ESOP will be voted by the ESOP Trustees
in the same proportion for and against proposals to stockholders as the
ESOP participants and beneficiaries actually vote shares of Common
Stock allocated to their individual accounts. Any allocated shares
which either abstain on the proposal or are not voted will be
disregarded in determining the percentage of stock voted for and
against each proposal by the participants and beneficiaries. The amount
of Common Stock beneficially owned by directors and executive officers
who serve as trustees of the ESOP and by all directors and executive
officers as a group does not include the shares held by the Trust,
except for the shares actually allocated to the accounts of the
executive officers.
(3) The shares are owned jointly with the person's spouse.
(4) The shares are owned of record by clients of Wellington Management
Company. None of the clients own more than 5% of the outstanding Common
Stock, except Bay Pond Partners, L.P.
(5) Includes 9,335 shares held by Mr. Humphrey, Jr.'s spouse, which shares
may be deemed to be beneficially owned by Mr. Humphrey, Jr. Excludes
shares held by Mr. Humphrey, Jr.'s son, Mr. Humphrey, III.
(6) Includes shares allocated to the accounts of individual officers under
the Company's ESOP as follows: Mr. Humphrey, Jr., 435 shares; Mr.
Humphrey, III, 338 shares; and all directors and executive officers as
a group, 1,267 shares.
(7) Includes 887 shares held by Mr. Humphrey, III's IRA and 1,000 shares
for which Mr. Humphrey, III is the trustee for his minor daughter.
Excludes shares held by Mr. Humphrey, III's father, Mr. Humphrey, Jr.
</TABLE>
<PAGE>
PROPOSAL TO ADOPT THE 1997 STOCK OPTION PLAN
General
The Board of Directors has adopted the Stock Option Plan which is
designed to attract and retain qualified personnel in key positions, provide
directors, officers and key employees with a proprietary interest in the Company
as an incentive to contribute to the success of the Company and reward key
employees for outstanding performance. The Stock Option Plan is also designed to
retain qualified directors for the Company. The Stock Option Plan provides for
the grant of incentive stock options intended to comply with the requirements of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")
("incentive stock options"), non-qualified or compensatory stock options and
stock appreciation rights (collectively "Awards"). Awards will be available for
grant to directors and key employees of the Company and any subsidiaries, except
that directors will be eligible to receive only compensatory stock options. If
stockholder approval is obtained, options to acquire shares of Common Stock will
be awarded to key employees of the Company and the Association and directors of
the Company with an exercise price equal to the fair market value of the Common
Stock on the date of grant.
Description of the Stock Option Plan
The following description of the Stock Option Plan is a summary of its
terms and is qualified in its entirety by reference to the Stock Option Plan, a
copy of which is attached hereto as Appendix A.
Administration. The Stock Option Plan will be administered and
interpreted by a committee of the Board of Directors ("Committee") that is
composed solely of two or more "Non-Employee Directors." The initial members of
the Committee will be Messrs. Arnold and Gary, III.
Stock Options. Under the Stock Option Plan, the Board of Directors or
the Committee will determine which directors, officers and key employees will be
granted options, whether such options will be incentive or compensatory options,
the number of shares subject to each option, whether such options may be
exercised by delivering other shares of Common Stock and when such options
become exercisable. The per share exercise price of a stock option shall be
equal to the fair market value of a share of Common Stock on the date the option
is granted.
All options granted to participants under the Stock Option Plan shall
become vested and exercisable at the rate determined by the Board of Directors
or the Committee when making an award. Notwithstanding the foregoing, no vesting
shall occur on or after a participant's employment with the Company is
terminated for any reason other than his death, disability or retirement. Unless
the Committee shall specifically state otherwise at the time an option is
granted, all options granted to participants shall become vested and exercisable
in full on the date an optionee terminates his employment with or service to the
Company or a subsidiary because of his death, disability or retirement. In
addition, all stock options will become vested and exercisable in full in the
event that there is a change in control of the Company, as defined in the Stock
Option Plan.
<PAGE>
Each stock option or portion thereof shall be exercisable at any time
on or after it vests and is exercisable until the earlier of ten years after its
date of grant or three months after the date on which the optionee's employment
or service as a non-employee director terminates, unless extended by the
Committee to a period not to exceed five years from such termination. However,
incentive stock options must be exercised within three months after the date on
which the optionee's employment terminates in order to obtain incentive stock
option treatment. If an optionee dies while serving as an employee or a
non-employee director or terminates his service as an employee or a non-employee
director as a result of disability or retirement without having fully exercised
his options, the optionee's executors, administrators, legatees or distributees
of his estate shall have the right to exercise such options during the
twelve-month period following the earlier of his death or termination due to
disability or retirement, provided no option will be exercisable more than ten
years from the date it was granted. Stock options are non-transferable except by
will or the laws of descent and distribution. Notwithstanding the foregoing, an
optionee who holds non-qualified options may transfer such options to his or her
spouse, lineal ascendants, lineal descendants, or to a duly established trust
for the benefit or one or more of these individuals. Options so transferred may
thereafter be transferred only to the optionee who originally received the grant
or to an individual or trust to whom the original optionee could have initially
transferred the option. Options which are so transferred shall be exercisable by
the transferee according to the same terms and conditions as applied to the
optionee.
Payment for shares purchased upon the exercise of options may be made
either in cash, by certified or cashier's check or, if permitted by the
Committee or the Board, by delivering shares of Common Stock (including shares
acquired pursuant to the exercise of an option) with a fair market value equal
to the total option price, by withholding some of the shares of Common Stock
which are being purchased upon exercise of an option, or any combination of the
foregoing. To the extent an optionee already owns shares of Common Stock prior
to the exercise of his or her option, such shares could be used (if permitted by
Committee or the Board) as payment for the exercise price of the option. If the
fair market value of a share of Common Stock at the time of exercise is greater
than the exercise price per share, this feature would enable the optionee to
acquire a number of shares of Common Stock upon exercise of the option which is
greater than the number of shares delivered as payment for the exercise price.
In addition, an optionee can exercise his or her option in whole or in part and
then deliver the shares acquired upon such exercise (if permitted by the
Committee or the Board) as payment for the exercise price of all or part of his
options. Again, if the fair market value of a share of Common Stock at the time
of exercise is greater than the exercise price per share, this feature would
enable the optionee to either (1) reduce the amount of cash required to receive
a fixed number of shares upon exercise of the option or (2) receive a greater
number of shares upon exercise of the option for the same amount of cash that
would have otherwise been used. Because options may be exercised in part from
time to time, the ability to deliver Common Stock as payment of the exercise
price could enable the optionee to turn a relatively small number of shares into
a large number of shares.
<PAGE>
Stock Appreciation Rights. Under the Stock Option Plan, the Board of
Directors or the Committee is authorized to grant stock appreciation rights to
optionees under which an optionee may surrender any exercisable incentive stock
option or compensatory stock option or any portion thereof in return for payment
by the Company to the optionee of cash or Common Stock in an amount equal to the
excess of the fair market value of the shares of Common Stock subject to the
option, or portion thereof, at the time over the exercise price of the option
with respect to such shares, or a combination of cash and Common Stock. A stock
appreciation right must be granted concurrently with any incentive stock option
to which it relates, and stock appreciation rights with respect to compensatory
stock options may be granted either concurrently with the option or at any time
thereafter which is prior to the exercise or expiration of such option.
Number of Shares Covered by the Stock Option Plan. A total of 64,802
shares of Common Stock has been reserved for issuance pursuant to the Stock
Option Plan, which is 10% of the Common Stock issued in connection with the
Conversion. It is currently anticipated that the shares of Common Stock to be
reserved for issuance pursuant to the Stock Option Plan will be a combination of
treasury shares and previously unissued shares. The issuance of new shares by
the Company pursuant to the Stock Option Plan would be dilutive to the voting
rights of existing stockholders and, depending upon the exercise price of the
Award, possibly the Company's book value per share and earnings per share. In
the event of a stock split, reverse stock split or stock dividend, the number of
shares of Common Stock under the Stock Option Plan, the number of shares to
which any Award relates and the exercise price per share under any option or
stock appreciation right shall be adjusted to reflect such increase or decrease
in the total number of shares of Common Stock outstanding. In addition, in the
event the Company declares a special cash dividend or return of capital in an
amount per share which exceeds 10% of the fair market value of a share of Common
Stock as of the date of declaration, the per share exercise price of all
previously granted Awards which remain unexercised as of the date of such
declaration shall be proportionately adjusted to give effect to such special
cash dividend or return of capital as of the date of payment of such special
cash dividend or return of capital, subject to certain limitations.
Amendment and Termination of the Stock Option Plan. Unless sooner
terminated, the Stock Option Plan shall continue in effect for a period of ten
years from the date the Stock Option Plan was adopted by the Board of Directors,
which was June 11, 1997. Termination of the Stock Option Plan shall not affect
any previously granted Awards.
Federal Income Tax Consequences. Under current provisions of the Code,
the federal income tax treatment of incentive stock options and compensatory
stock options is different. As regards incentive stock options, an optionee who
meets certain holding period requirements will not recognize income at the time
the option is granted or at the time the option is exercised, and a federal
income tax deduction generally will not be available to the Company at any time
as a result of such grant or exercise. With respect to compensatory stock
options, the difference between the fair market value on the date of exercise
and the option exercise price generally will be treated as compensation income
upon exercise, and the Company will be entitled to a deduction in the amount of
income so recognized by the optionee. Upon the exercise of a stock appreciation
right, the holder will realize income for federal income tax purposes equal to
the amount received by him, whether in cash, shares of stock or both, and the
Company will be entitled to a deduction for federal income tax purposes in the
same amount.
<PAGE>
Section 162(m) of the Code generally limits the deduction for certain
compensation in excess of $1 million per year paid by a publicly-traded
corporation to its chief executive officer and the four other most highly
compensated executive officers ("covered executive"). Certain types of
compensation, including compensation based on performance goals, are excluded
from the $1 million deduction limitation. In order for compensation to qualify
for this exception: (i) it must be paid solely on account of the attainment of
one or more pre-established, objective performance goals; (ii) the performance
goal must be established by a compensation committee consisting solely of two or
more outside directors, as defined; (iii) the material terms under which the
compensation is to be paid, including performance goals, must be disclosed to
and approved by stockholders in a separate vote prior to payment; and (iv) prior
to payment, the compensation committee must certify that the performance goals
and any other material terms were in fact satisfied (the "Certification
Requirement").
Final Treasury regulations issued in July 1996 provide that
compensation attributable to a stock option or stock appreciation right is
deemed to satisfy the requirement that compensation be paid solely on account of
the attainment of one or more performance goals if: (i) the grant is made by a
compensation committee consisting solely of two or more outside directors, as
defined; (ii) the plan under which the option or stock appreciation right is
granted states the maximum number of shares with respect to which options or
stock appreciation rights may be granted during a specified period to any
employee; and (iii) under the terms of the option or stock appreciation right,
the amount of compensation the employee could receive is based solely on an
increase in the value of the stock after the date of grant or award. The
Certification Requirement is not necessary if these other requirements are
satisfied.
The Option Plan has been designed to meet the requirements of Section
162(m) of the Code and, as a result, the Company believes that compensation
attributable to stock options and stock appreciation rights granted under the
Option Plan in accordance with the foregoing requirements will be fully
deductible under Section 162(m) of the Code. If the non-excluded compensation of
a covered executive exceeded $1 million, however, compensation attributable to
other awards, such as restricted stock, may not be fully deductible unless the
grant or vesting of the award is contingent on the attainment of a performance
goal determined by a compensation committee meeting specified requirements and
disclosed to and approved by the stockholders of the Company. No officer of the
Company is expected to have compensation in excess of the Section 162(m)
threshold in the foreseeable future.
The above description of tax consequences under federal law is
necessarily general in nature and does not purport to be complete. Moreover,
statutory provisions are subject to change, as are their interpretations, and
their application may vary in individual circumstances. Finally, the
consequences under applicable state and local income tax laws may not be the
same as under the federal income tax laws.
Accounting Treatment. Stock appreciation rights will, in most cases,
require a charge against the earnings of the Company each year representing
appreciation in the value of such rights over periods in which they become
exercisable. Such charge is based on the difference between the exercise price
specified in the related option and the current market price of the Common
Stock. In the event of a decline in the market price of the Common Stock
subsequent to a charge against earnings related to the estimated costs of stock
appreciation rights, a reversal of prior charges is made in the amount of such
decline (but not to exceed aggregate prior charges).
<PAGE>
Neither the grant nor the exercise of an incentive stock option or a
non-qualified stock option under the Stock Option Plan currently requires any
charge against earnings under generally accepted accounting principles. In
October 1995, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based
Compensation," which is effective for transactions entered into after December
15, 1995. This Statement establishes financial accounting and reporting
standards for stock-based employee compensation plans. This Statement defines a
fair value method of accounting for an employee stock option or similar equity
instrument and encourages all entities to adopt that method of accounting for
all of their employee stock compensation plans. However, it also allows an
entity to continue to measure compensation cost for those plans using the
intrinsic value method of accounting prescribed by APB Opinion No. 25,
"Accounting for Stock Issued to Employees." Under the fair value method,
compensation cost is measured at the grant date based on the value of the award
and is recognized over the service period, which is usually the vesting period.
Under the intrinsic value method, compensation cost is the excess, if any, of
the quoted market price of the stock at grant date or other measurement date
over the amount an employee must pay to acquire the stock. The Company
anticipates that it will use the intrinsic value method, in which event pro
forma disclosure will be included in the footnotes to the Company's financial
statements to show what net income and earnings per share would have been if the
fair value method had been utilized. If the Company elects to utilize the fair
value method, its net income and earnings per share may be adversely affected.
Stockholder Approval. No Awards will be granted under the Stock Option
Plan unless the Stock Option Plan is approved by stockholders. Stockholder
ratification of the Stock Option Plan will satisfy certain Nasdaq market listing
and tax requirements.
Awards to be Granted. The Board of Directors of the Company adopted the
Stock Option Plan and the Committee intends to grant compensatory stock options
to directors, executive officers and employees of the Company and the
Association promptly after the date of stockholder approval of the Stock Option
Plan with a per share exercise price equal to the fair market value of a share
of Common Stock on the date of grant. The Stock Option Plan provides that no
individual officer will receive an Award of more than 25% of the shares
available for grant under the Stock Option Plan, that no non-employee director
will receive an Award of more than 5% of the shares available for grant and that
non-employee directors as a group will not receive Awards of more than 30% of
the shares available for grant under the Stock Option Plan. The following table
sets forth certain information with respect to the proposed grants to the
persons or groups shown.
<PAGE>
<TABLE>
<CAPTION>
Estimate of Number of
Name of Individual or Shares to be Subject
Number of Persons in Group Title to Stock Options
- -------------------------- ----- ----------------
<S> <C> <C>
Hugh E. Humphrey, Jr. President and Chief Executive 12,960
Officer
Dennis J. McCluer Vice President and Chief Operating 12,960
Officer
Hugh E. Humphrey, III Secretary and Treasurer 12,960
All executive officers as --- 38,880
a group (three persons)
All non-employee directors --- 9,720
as a group (three persons)
All employees, not including --- 11,016
executive officers, as a
group (nine persons)
</TABLE>
It is currently anticipated that one-fourth of the proposed options set
forth above to be granted to officers and directors will be vested and
exercisable on the date of grant promptly after approval of the Stock Option
Plan and that one-fourth of the aggregate number of options granted will vest
and become exercisable on each of the first three annual anniversary dates
thereafter.
The Board of Directors recommends that stockholders vote FOR adoption
of the 1997 Stock Option Plan.
PROPOSAL TO ADOPT THE RECOGNITION
AND RETENTION PLAN AND TRUST AGREEMENT
General
The Board of Directors of the Company has adopted the Recognition Plan,
the objective of which is to retain qualified personnel in key positions,
provide officers, key employees and directors with a proprietary interest in the
Company as an incentive to contribute to its success and reward key employees
for outstanding performance. Officers and key employees of the Company who are
selected by the Board of Directors of the Company or a committee thereof, as
well as non-employee directors of the Company, will be eligible to receive
benefits under the Recognition Plan. If stockholder approval is obtained, shares
will be granted to employees and to non-employee directors as described below.
Description of the Recognition Plan
The following description of the Recognition Plan is a summary of its
terms and is qualified in its entirety by reference to the Recognition Plan, a
copy of which is attached hereto as Appendix B.
<PAGE>
Administration. The Recognition Plan will be administered and
interpreted by a committee of the Board of Directors ("Committee") that is
composed solely of two or more "Non-Employee Directors." The initial members of
the Committee will be Messrs. Arnold and Gary, III, who will also serve as
trustees of the trust established pursuant to the Recognition Plan ("Trust").
The trustees will have the responsibility to invest all funds contributed by the
Company to the Trust.
Upon stockholder approval of the Recognition Plan, the Company intends
to contribute sufficient funds to the Trust to enable the Trust to purchase a
number of shares of Common Stock equal to 4% of the Common Stock issued in the
Conversion, or 25,921 shares. It is currently anticipated that these shares will
be acquired through open market purchases to the extent available, although the
Company reserves the right to issue previously unissued shares or treasury
shares to the Recognition Plan. The issuance of new shares by the Company would
be dilutive to the voting rights of existing stockholders and to the Company's
book value per share and earnings per share.
Grants. Shares of Common Stock granted pursuant to the Recognition Plan
will be in the form of restricted stock payable over a period as determined by
the Committee or the Board of Directors. A recipient will be entitled to all
voting and other stockholder rights with respect to shares which have been
earned and allocated under the Recognition Plan. However, until such shares have
been earned and allocated, they may not be sold, pledged or otherwise disposed
of and are required to be held in the Recognition Plan Trust. The Recognition
Plan provides that cash held by the Trust pursuant to receipt of dividends or
returns of capital on the Common Stock held by the Trust may be used to purchase
additional shares of Common Stock. Any cash dividends, stock dividends or
returns of capital declared in respect of each vested share held by the
Recognition Plan Trust will be paid by the Recognition Plan Trust as soon as
practicable after the Trust's receipt thereof to the recipient on whose behalf
such share is then held by the Trust. In addition, any cash dividends, stock
dividends or returns of capital declared in respect of unvested share awards
will be held by the Recognition Plan Trust for the benefit of the recipients,
and such dividends or returns of capital, including any interest thereon, will
be paid out proportionately by the Recognition Plan Trust to the recipients
thereof as soon as practicable after the share awards become earned, either in
the form of cash or (if such cash is used by the Trust to purchase additional
shares of Common Stock) shares of Common Stock.
If a recipient terminates employment for reasons other than death,
disability or retirement, the recipient will forfeit all rights to the allocated
shares under restriction. All shares subject to an award held by a recipient
whose employment with or service to the Company or any subsidiary terminates due
to death or Disability, as defined in the Recognition Plan, shall be deemed
earned as of the recipient's last day of employment with or service to the
Company or any subsidiary and shall be distributed as soon as practicable
thereafter. In addition, in the event that a recipient's employment with or
service to the Company or any subsidiary terminates due to Retirement, as
defined in the Recognition Plan, all shares subject to an award held by a
recipient shall be deemed earned as of the recipient's last day of employment
with or service to the Company or any subsidiary and shall be distributed as
soon as practicable thereafter. All shares subject to an award held by a
recipient also shall be deemed to be earned in the event of a change in control
of the Company, as defined in the Recognition Plan.
<PAGE>
During the lifetime of the recipient, shares subject to an award may
only be earned by and paid to the recipient, provided that shares subject to an
award and rights to such shares shall be transferable by a recipient to his or
her spouse, lineal ascendants, lineal descendants, or to a duly established
trust. Shares subject to an award so transferred may not again be transferred
other than to the recipient who originally received the grant or to an
individual or trust to whom such original recipient could have transferred
shares subject to an award. Shares subject to awards which are transferred shall
be subject to the same terms and conditions as would have applied to such shares
subject to awards in the hands of the recipient who originally received the
grant.
Federal Income Tax Consequences. Pursuant to Section 83 of the Code,
recipients of Recognition Plan awards will recognize ordinary income in an
amount equal to the fair market value of the shares of Common Stock granted to
them at the time that the shares vest and are deemed earned. A recipient of a
Recognition Plan award may also elect, however, to accelerate the recognition of
income with respect to his or her grant to the time when the Recognition Plan
award is first granted to him or her, notwithstanding the vesting schedule of
such awards. The Company will be entitled to deduct as a compensation expense
for tax purposes the same amounts recognized as income by recipients of
Recognition Plan awards in the year in which such amounts are included in
income.
Accounting Treatment. For a discussion of SFAS No. 123, see "Proposal
to Adopt the 1997 Stock Option Plan - Accounting Treatment." Under the intrinsic
value method, the Company will also recognize a compensation expense as shares
of Common Stock granted pursuant to the Recognition Plan vest. The amount of
compensation expense recognized for accounting purposes is based upon the fair
market value of the Common Stock at the date of grant to recipients, rather than
the fair market value at the time of vesting for tax purposes. The vesting of
Plan Share Awards will have the effect of increasing the Company's compensation
expense.
Stockholder Approval. No shares will be granted under the Recognition
Plan unless the Recognition Plan is approved by stockholders. Stockholder
ratification of the Recognition Plan will satisfy certain Nasdaq market listing
requirements.
Shares to be Granted. The Board of Directors of the Company adopted the
Recognition Plan and the Committee intends to grant awards to directors,
executive officers and employees of the Company and the Association in one or
more series of awards promptly after the date of stockholder approval of the
Recognition Plan. The Recognition Plan provides that no individual officer will
receive an award of more than 25% of the shares available for grant under the
Recognition Plan, that no non-employee director will receive an award of more
than 5% of the shares available for grant and that non-employee directors as a
group will not receive awards of more than 30% of the shares available for grant
under the Recognition Plan. The following table sets forth certain information
with respect to the proposed grants to the persons or groups shown.
<PAGE>
<TABLE>
<CAPTION>
Estimate of
Name of Individual or Number of Shares
Number of Persons in Group Title to Be Awarded
- -------------------------- ----- -------------
<S> <C> <C>
Hugh E. Humphrey, Jr. President and Chief Executive 5,184
Officer
Dennis J. McCluer Vice President and Chief 5,184
Operating Officer
Hugh E. Humphrey, III Secretary and Treasurer 5,184
All executive officers as --- 15,552
a group (three persons)
All non-employee directors --- 3,888
as a group (three persons)
All employees, not including --- 6,481
executive officers, as a group
(nine persons)
</TABLE>
It is currently anticipated that 20% of the proposed number of shares
set forth above to be granted to officers and directors will be vested on the
date of grant promptly after approval of the Recognition Plan and that 20% of
the aggregate number of shares granted will vest on each of the first four
annual anniversary dates thereafter.
In the event that the Company declares a special cash dividend or
return of capital prior to the award and vesting of all shares under the
Recognition Plan, such amount could be used to purchase additional shares of
Common Stock and those shares would be available for grant to directors and
employees under the Recognition Plan, which could increase the number of shares
subject to the Recognition Plan and the number of shares awarded as described
above.
The Board of Directors recommends that stockholders vote FOR adoption
of the 1997 Recognition and Retention Plan and Trust.
<PAGE>
EXECUTIVE COMPENSATION
Executive Compensation
The following table sets forth the compensation paid by the Association
for services rendered in all capacities during the periods indicated to the
President and Chief Executive Officer of the Association.
<TABLE>
<CAPTION>
Annual Compensation
Name and Principal All Other
Position Year Salary (1) Bonus Other (2) Compensation
- -------- ---- ---------- ----- --------- ------------
<S> <C> <C> <C> <C> <C>
Hugh E. Humphrey, Jr., 1996 $52,260 $2,090 $ -- $5,003(3)
Chairman of the Board, 1995 55,970 -- -- --
President and Chief
Executive Officer
- --------------------
(1) Includes directors' fees of $2,100 in 1996 and $3,720 in 1995.
(2) Annual compensation does not include amounts attributable to other
miscellaneous benefits received by Mr. Humphrey. The costs to the
Association of providing such benefits did not exceed 10% of the total
salary and bonus paid to or accrued for the benefit of such executive
officer.
(3) Represents as of December 31, 1996 the value of the 435 shares
allocated to Mr. Humphrey's account under the ESOP for 1996.
</TABLE>
Employment Agreement
The Company and the Association (collectively, the "Employers") entered
into an employment agreement with Mr. Humphrey in connection with the
Conversion. The Employers have agreed to employ Mr. Humphrey for a term of three
years in his current position at an initial salary of $53,760. At least 30 days
prior to each annual anniversary date of the employment agreement, the Boards of
Directors of the Company and the Association shall determine whether or not to
extend the agreement for an additional one year. Any party may elect not to
extend the agreement for an additional year by providing written notice at least
30 days prior to any annual anniversary date.
The employment agreement is terminable with or without cause by the
Employers. The officer shall have no right to compensation or other benefits
pursuant to the employment agreement for any period after voluntary termination
or termination by the Employers for cause, disability, retirement or death,
provided, however, that (i) in the event the officer terminates his employment
because of failure of the Employers to comply with any material provision of the
employment agreement or (ii) the employment agreement is terminated by the
Employers other than for cause, disability, retirement or death or by the
officer as a result of certain adverse actions which are taken with respect to
the officer's employment following a Change in Control of the Company, as
<PAGE>
defined, Mr Humphrey will be entitled to a cash severance amount equal to three
times his average annual compensation over his most recent five taxable years.
In addition, Mr. Humphrey will be entitled to a continuation of benefits similar
to those he is receiving at the time of such termination for the remaining term
of the agreement or until the officer obtains full-time employment with another
employer, whichever occurs first.
A Change in Control is generally defined in the employment agreement to
include any change in control required to be reported under the federal
securities laws, as well as (i) the acquisition by any person of 25% or more of
the Company's outstanding voting securities and (ii) a change in a majority of
the directors of the Company during any two-year period without the approval of
at least two-thirds of the persons who were directors of the Company at the
beginning of such period.
The employment agreement provides that in the event that any of the
payments to be made thereunder or otherwise upon termination of employment are
deemed to constitute a "parachute payment" within the meaning of Section 280G of
the Code, then such payments and benefits received thereunder shall be reduced,
in the manner determined by the employee, by the amount, if any, which is the
minimum necessary to result in no portion of the payments and benefits being
non-deductible by the Employers for federal income tax purposes. Parachute
payments generally are payments equal to or exceeding three times the base
amount, which is defined to mean the recipient's gross income during the most
recent five taxable years ending before the date on which a change in control of
the employer occurred. Recipients of parachute payments are subject to a 20%
excise tax on the amount by which such payments exceed the base amount, in
addition to regular income taxes, and payments in excess of the base amount are
not deductible by the employer as compensation expense for federal income tax
purposes.
The Employers also entered into similar agreements with Messrs. McCluer
and Humphrey, III, except that Mr. Humphrey, III's agreement has a term of only
one year and provides for severance equal to one times his average annual
compensation. Although the above-described employment agreements could increase
the cost of any acquisition of control of the Company, management of the Company
does not believe that the terms thereof would have a significant anti-takeover
effect.
Employee Stock Ownership Plan
The Company established the ESOP for employees of the Company and the
Association effective January 1, 1996. Full-time employees of the Company and
the Association who have been credited with at least 1,000 hours of service
during a twelve month period and who have attained age 18 are eligible to
participate in the ESOP.
As part of the Conversion, in order to fund the purchase of up to 8% of
the Common Stock to be issued in the Conversion, the ESOP borrowed funds from
the Company in an amount equal to 100% of the aggregate purchase price of the
Common Stock acquired by the ESOP. The loan to the ESOP will be repaid
principally from the Company's and the Association's contributions to the ESOP
over a period of 10 years, and the collateral for the loan is the Common Stock
purchased by the ESOP. The loan to the ESOP bears a fixed interest rate of
8.25%. The Company may, in any plan year, make additional discretionary
contributions for the benefit of plan participants in either cash or shares of
Common Stock, which may be acquired through the purchase of outstanding shares
<PAGE>
in the market or from individual stockholders, upon the original issuance of
additional shares by the Company or upon the sale of treasury shares by the
Company. Such purchases, if made, would be funded through additional borrowings
by the ESOP or additional contributions from the Company. The timing, amount and
manner of future contributions to the ESOP will be affected by various factors,
including prevailing regulatory policies, the requirements of applicable laws
and regulations and market conditions.
Shares purchased by the ESOP with the proceeds of the loan are held in
a suspense account and released on a pro rata basis as debt service payments are
made. Discretionary contributions to the ESOP and shares released from the
suspense account are allocated among participants on the basis of compensation.
Forfeitures are reallocated among remaining participating employees and may
reduce any amount the Company might otherwise have contributed to the ESOP.
Participants vest in their right to receive their account balances within the
ESOP at the rate of 20% per year starting with the completion of one year of
service and will be 100% vested upon the completion of five years of service.
Credit is given for years of service with the Association prior to adoption of
the ESOP. In the case of a "change in control," as defined, however,
participants will become immediately fully vested in their account balances.
Benefits may be payable upon retirement or separation from service. The
Company's contributions to the ESOP are not fixed, so benefits payable under the
ESOP cannot be estimated.
Messrs. Dang, Humphrey, III and McCluer serve as trustees of the ESOP.
Under the ESOP, the trustees must vote all allocated shares held in the ESOP in
accordance with the instructions of the participating employees, and unallocated
shares will be voted in the same ratio on any matters as to those shares for
which instructions are actually given.
Generally accepted accounting principles require that any third party
borrowing by the ESOP be reflected as a liability on the Company's statement of
financial condition. Since the ESOP is borrowing from the Company, such
obligation is not treated as a liability, but the amount of the borrowing is
deducted from stockholders' equity. If the ESOP purchases newly issued shares
from the Company, total stockholders' equity would neither increase nor
decrease, but per share stockholders' equity and per share net earnings would
decrease as the newly issued shares are allocated to the ESOP participants.
The ESOP is subject to the requirements of the Employee Retirement
Income Security Act of 1974, as amended, and the regulations of the Internal
Revenue Service and the Department of Labor thereunder.
Certain Transactions
Mr. Humphrey, Jr., the President and Chief Executive Officer of the
Association, and his wife own the Association's main office building and lease
the building to the Association. Prior to April 1, 1996, the lease was for a
30-year term expiring in September 1997, and the rent was $33,000 per year,
subject to increase to $82,000 per year at the discretion of Mr. Humphrey, Jr.
Effective April 1, 1996, the Association entered into a new 10 year lease with
Mr. Humphrey, Jr. and his spouse, and the rent is $45,000 for the first five
years of the new lease. The rent will increase during the second five years of
the new lease at a rate equal to the rate of increase in the consumer price
index, but the rent will not decrease if the consumer price index decreases. The
new lease may be renewed at the Association's option for two additional 10-year
periods. Under both the old lease and the new lease, the Association pays all
taxes, insurance and maintenance costs.
<PAGE>
Mr. Humphrey, Jr. is the father-in-law of Harold A. Buchler, Jr., a
partner in the law firm of Buchler & Buchler. During 1996, Buchler & Buchler
received an annual retainer of $12,000 from the Association, $5,000 of legal
fees from the Association in connection with foreclosures, and approximately
$14,000 in connection with real estate loan closings. Most of the closing fees
were paid by the borrowers rather than the Association.
Management believes that the above transactions were on terms at least
as favorable to the Association as could be obtained from unaffiliated third
parties.
Indebtedness of Management
The Association, in the ordinary course of business, makes available to
its directors, officers and employees mortgage loans on their primary residences
and other types of loans. Such loans are made on the same terms as comparable
loans to other borrowers. It is the belief of management that these loans
neither involve more than the normal risk of collectibility nor present other
unfavorable features. At December 31, 1996, the Association's outstanding loans
to directors and executive officers of the Association, or members of their
immediate families, totalled approximately $18,000.
During 1996, no current director or executive officer of the
Association, or members of their immediate families, had aggregate indebtedness
in excess of $60,000 to the Association.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have included in the proxy
materials of the Company relating to the next annual meeting of stockholders of
the Company, which is scheduled to be held in April 1998, must be received at
the principal executive offices of the Company, 1 Westbank Expressway, Algiers,
Louisiana 70114, Attention: Hugh E. Humphrey, III, Secretary, no later than
December 5, 1997. If such proposal is in compliance with all of the requirements
of Rule 14a-8 under the 1934 Act, it will be included in the proxy statement and
set forth on the form of proxy issued for such annual meeting of stockholders.
It is urged that any such proposals be sent by certified mail, return receipt
requested.
Stockholder proposals which are not submitted for inclusion in the
Company's proxy materials pursuant to Rule 14a-8 under the 1934 Act may be
brought before an annual meeting provided that the requirements set forth in
Article 9.D of the Company's Articles of Incorporation are satisfied in a timely
manner. To be timely, a stockholder's notice must be delivered to, or mailed and
received at, the principal executive offices of the Company not less than sixty
(60) days prior to the anniversary date of the mailing of the proxy materials by
the Company for the immediately preceding annual meeting of stockholders of the
Company.
OTHER MATTERS
Each proxy solicited hereby also confers discretionary authority on the
Board of Directors of the Company to vote the proxy with respect to the approval
of the minutes of the last meeting of stockholders, the election of any person
as a director if the nominee is unable to serve or for good cause will not
serve, matters incident to the conduct of the meeting, and upon such other
matters as may properly come before the Special Meeting. Management is not aware
<PAGE>
of any business that may properly come before the Special Meeting other than the
matters described above in this Proxy Statement. However, if any other matters
should properly come before the meeting, it is intended that the proxies
solicited hereby will be voted with respect to those other matters in accordance
with the judgment of the persons voting the proxies.
The cost of the solicitation of proxies will be borne by the Company.
The Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending the proxy
materials to the beneficial owners of the Company's Common Stock. In addition to
solicitations by mail, directors, officers and employees of the Company may
solicit proxies personally or by telephone without additional compensation.
YOUR VOTE IS IMPORTANT! WE URGE YOU TO SIGN AND DATE THE ENCLOSED PROXY
CARD AND RETURN IT TODAY IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
<PAGE>
APPENDIX A
ALGIERS BANCORP, INC.
1997 STOCK OPTION PLAN
ARTICLE I
ESTABLISHMENT OF THE PLAN
Algiers Bancorp, Inc. (the "Corporation") hereby establishes this 1997
Stock Option Plan (the "Plan") upon the terms and conditions hereinafter stated.
ARTICLE II
PURPOSE OF THE PLAN
The purpose of this Plan is to improve the growth and profitability of
the Corporation and its Subsidiary Companies by providing Employees and
Non-Employee Directors with a proprietary interest in the Corporation as an
incentive to contribute to the success of the Corporation and its Subsidiary
Companies, and rewarding those Employees for outstanding performance. All
Incentive Stock Options issued under this Plan are intended to comply with the
requirements of Section 422 of the Code, and the regulations thereunder, and all
provisions hereunder shall be read, interpreted and applied with that purpose in
mind.
ARTICLE III
DEFINITIONS
3.01 "Association" means Algiers Homestead Association, the
wholly-owned subsidiary of the Corporation.
3.02 "Award" means an Option or Stock Appreciation Right granted
pursuant to the terms of this Plan.
3.03 "Board" means the Board of Directors of the Corporation.
3.04 "Change in Control of the Corporation" shall be deemed to have
occurred if: (i) any "person," as such term is used in Sections 13(d) and 14(d)
of the Exchange Act (other than the Corporation and any trustee or other
fiduciary holding securities under any employee benefit plan of the
Corporation), is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the
Corporation representing 20% or more of the combined voting power of the
Corporation's then outstanding securities; (ii) during any period of three
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors, and any new director whose election by the Board of
Directors or nomination for election by the Corporation's stockholders was
approved by a vote of at least two-thirds of the directors then still in office
who either were directors at the beginning of the three-year period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute at least a majority of the Board of Directors; (iii) the
stockholders of the Corporation approve a merger or consolidation of the
Corporation with any other corporation, other than a merger or consolidation
that would result in the voting securities of the Corporation outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the combined voting power of the voting securities of
<PAGE>
the surviving corporation outstanding immediately after such merger or
consolidation; or (iv) the stockholders of the Corporation approve a plan of
complete liquidation of the Corporation or an agreement for the sale or
disposition by the Corporation of all or substantially all of the Corporation's
assets. If any of the events enumerated in clauses (i) through (iv) occur, the
Board shall determine the effective date of the Change in Control resulting
therefrom for purposes of the Plan.
3.05 "Code" means the Internal Revenue Code of 1986, as amended.
3.06 "Committee" means a committee of two or more directors appointed
by the Board pursuant to Article IV hereof, each of whom shall be a Non-Employee
Director as defined in Rule 16b-3(b)(3)(i) of the Exchange Act.
3.07 "Common Stock" means shares of the common stock, par value $.01
per share, of the Corporation.
3.08 "Disability" means any physical or mental impairment which
qualifies an Employee for disability benefits under the applicable long-term
disability plan maintained by the Corporation or a Subsidiary Company, or, if no
such plan applies, which would qualify such Employee for disability benefits
under the Federal Social Security System.
3.09 "Effective Date" means the date this Plan is approved by the
stockholders of the Corporation, which shall not be earlier than the one-year
anniversary of the consummation of the Association's conversion from mutual to
stock form pursuant to the Plan of Conversion adopted by the Association.
3.10 "Employee" means any person who is employed by the Corporation or
a Subsidiary Company, or is an Officer of the Corporation or a Subsidiary
Company, but not including directors who are not also Officers of or otherwise
employed by the Corporation or a Subsidiary Company.
3.11 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
3.12 "Fair Market Value" shall be equal to the fair market value per
share of the Corporation's Common Stock on the date an Award is granted. For
purposes hereof, the Fair Market Value of a share of Common Stock shall be the
closing sale price of a share of Common Stock on the date in question (or, if
such day is not a trading day in the U.S. markets, on the nearest preceding
trading day), as reported with respect to the principal market (or the composite
of the markets, if more than one) or national quotation system in which such
shares are then traded, or if no such closing prices are reported, the mean
between the high bid and low asked prices that day on the principal market or
national quotation system then in use, or if no such quotations are available,
the price furnished by a professional securities dealer making a market in such
shares selected by the Committee.
3.13 "Incentive Stock Option" means any Option granted under this Plan
which the Board intends (at the time it is granted) to be an incentive stock
option within the meaning of Section 422 of the Code or any successor thereto.
3.14 "Non-Employee Director" means a member of the Board who is not an
Officer or Employee of the Corporation or any Subsidiary Company. No honorary
directors, advisory directors or directors emeritus shall be entitled to receive
Options under this Plan.
<PAGE>
3.15 "Non-Qualified Option" means any Option granted under this Plan
which is not an Incentive Stock Option.
3.16 "Offering" means the offering of Common Stock to the public
pursuant to the Plan of Conversion adopted by the Association.
3.17 "Officer" means an Employee whose position in the Corporation or
Subsidiary Company is that of a corporate officer, as determined by the Board.
3.18 "Option" means a right granted under this Plan to purchase Common
Stock.
3.19 "Optionee" means an Employee or Non-Employee Director or former
Employee or Non-Employee Director to whom an Option is granted under the Plan.
3.20 "Retirement" means a termination of employment upon or after
attainment of age sixty-five (65) or such earlier age as may be specified in any
applicable plans or policies maintained by the Corporation or a Subsidiary
Company.
3.21 "Stock Appreciation Right" means a right to surrender an Option in
consideration for a payment by the Corporation in cash and/or Common Stock, as
provided in the discretion of the Committee in accordance with Section 8.11.
3.22 "Subsidiary Companies" means those subsidiaries of the
Corporation, including the Association, which meet the definition of "subsidiary
corporations" set forth in Section 425(f) of the Code, at the time the Award in
question is granted.
ARTICLE IV
ADMINISTRATION OF THE PLAN
4.01 Duties of the Committee. The Plan shall be administered and
interpreted by the Committee, as appointed from time to time by the Board
pursuant to Section 4.02. The Committee shall have the authority to adopt, amend
and rescind such rules, regulations and procedures as, in its opinion, may be
advisable in the administration of the Plan, including, without limitation,
rules, regulations and procedures which (i) deal with satisfaction of an
Optionee's tax withholding obligation pursuant to Section 12.02 hereof, (ii)
include arrangements to facilitate the Optionee's ability to borrow funds for
payment of the exercise or purchase price of an Award, if applicable, from
securities brokers and dealers, and (iii) include arrangements which provide for
the payment of some or all of such exercise or purchase price by delivery of
previously-owned shares of Common Stock or other property and/or by withholding
some of the shares of Common Stock which are being acquired. The interpretation
and construction by the Committee of any provisions of the Plan, any rule,
regulation or procedure adopted by it pursuant thereto or of any Award shall be
final and binding in the absence of action by the Board of Directors.
4.02 Appointment and Operation of the Committee. The members of the
Committee shall be appointed by, and will serve at the pleasure of, the Board.
The Board from time to time may remove members from, or add members to, the
Committee, provided the Committee shall continue to consist of two or more
members of the Board, each of whom shall be a non-employee director as defined
in Rule 16b-3(b)(3)(i) of the Exchange Act or any successor thereto. In
addition, each member of the Committee shall be an "outside director" within the
meaning of Section 162(m) of the Code and regulations thereunder at such times
as is required under such regulations. The Committee shall act by vote or
<PAGE>
written consent of a majority of its members. Subject to the express provisions
and limitations of the Plan, the Committee may adopt such rules, regulations and
procedures as it deems appropriate for the conduct of its affairs. It may
appoint one of its members to be chairman and any person, whether or not a
member, to be its secretary or agent. The Committee shall report its actions and
decisions to the Board at appropriate times but in no event less than one time
per calendar year.
4.03 Revocation for Misconduct. The Board of Directors or the Committee
may by resolution immediately revoke, rescind and terminate any Award, or
portion thereof, to the extent not yet vested, previously granted under this
Plan to an Employee who is discharged from the employ of the Corporation or a
Subsidiary Company for cause, which, for purposes hereof, shall mean termination
because of the Employee's 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.
Options granted to a Non-Employee Director who is removed for cause pursuant to
the Corporation's Articles of Incorporation shall terminate as of the effective
date of such removal.
4.04 Limitation on Liability. Neither the members of the Board of
Directors nor any member of the Committee shall be liable for any action or
determination made in good faith with respect to the Plan, any rule, regulation
or procedure adopted pursuant thereto or for any Awards granted hereunder. If
any members of the Board of Directors or a member of the Committee is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of anything done or not done by him in such capacity under or with
respect to the Plan, the Corporation shall, subject to the requirements of
applicable laws and regulations, indemnify such member against all liabilities
and expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in the best interests of the Corporation and its
Subsidiary Companies and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful.
4.05 Compliance with Law and Regulations. All Awards granted hereunder
shall be subject to all applicable federal and state laws, rules and regulations
and to such approvals by any government or regulatory agency as may be required.
The Corporation shall not be required to issue or deliver any certificates for
shares of Common Stock prior to the completion of any registration or
qualification of or obtaining of consents or approvals with respect to such
shares under any federal or state law or any rule or regulation of any
government body, which the Corporation shall, in its sole discretion, determine
to be necessary or advisable. Moreover, no Option or Stock Appreciation Right
may be exercised if such exercise would be contrary to applicable laws and
regulations.
4.06 Restrictions on Transfer. The Corporation may place a legend upon
any certificate representing shares acquired pursuant to an Award granted
hereunder in the event that the transfer of such shares may be restricted by
applicable laws and regulations.
<PAGE>
ARTICLE V
ELIGIBILITY
Awards may be granted to such Employees or Non-Employee Directors of
the Corporation and its Subsidiary Companies as may be designated from time to
time by the Board of Directors or the Committee. Awards may not be granted to
individuals who are not Employees or Non-Employee Directors of either the
Corporation or its Subsidiary Companies. Non-Employee Directors shall be
eligible to receive only Non-Qualified Options.
ARTICLE VI
COMMON STOCK COVERED BY THE PLAN
6.01 Option Shares. The aggregate number of shares of Common Stock
which may be issued pursuant to this Plan, subject to adjustment as provided in
Article IX, shall be 64,802 shares, which is equal to 10.0% of the shares of
Common Stock issued in the Offering. None of such shares shall be the subject of
more than one Award at any time (provided that Stock Appreciation Rights and the
related Options shall be deemed to be a single Award), but if an Option as to
any shares is surrendered before exercise, or expires or terminates for any
reason without having been exercised in full, or for any other reason ceases to
be exercisable, the number of shares covered thereby shall again become
available for grant under the Plan as if no Awards had been previously granted
with respect to such shares. Notwithstanding the foregoing, if an Option is
surrendered in connection with the exercise of a Stock Appreciation Right, the
number of shares covered thereby shall not be available for grant under the
Plan.
6.02 Source of Shares. The shares of Common Stock issued under the Plan
may be authorized but unissued shares, treasury shares, shares purchased by the
Corporation on the open market or from private sources for use under the Plan,
or, if applicable, shares held in a grantor trust created by the Corporation.
ARTICLE VII
DETERMINATION OF
AWARDS, NUMBER OF SHARES, ETC.
7.01 Determination of Awards. The Board of Directors or the Committee
shall, in its discretion, determine from time to time which Employees and
Non-Employee Directors will be granted Awards under the Plan, the number of
shares of Common Stock subject to each Award, whether each Option will be an
Incentive Stock Option or a Non-Qualified Stock Option and the exercise price of
an Option. In making determinations with respect to Employees, there shall be
taken into account the duties, responsibilities and performance of each
respective Employee, his present and potential contributions to the growth and
success of the Corporation, his salary and such other factors as the Board of
Directors or the Committee shall deem relevant to accomplishing the purposes of
the Plan.
7.02 Maximum Awards to Employees. Notwithstanding anything contained in
this Plan to the contrary, the maximum number of shares of Common Stock to which
Awards may be granted to any Employee shall be 16,200, subject to any applicable
adjustment pursuant to Article IX hereof.
<PAGE>
7.03 Maximum Awards to Non-Employee Directors. Notwithstanding anything
contained in this Plan to the contrary, the maximum number of shares of Common
Stock to which Non-Qualified Options may be granted under this Plan to (a) any
Non-Employee Director shall be 3,240 and (b) all Non-Employee Directors as a
group shall be 19,440, subject to any applicable adjustment pursuant to Article
IX hereof.
ARTICLE VIII
OPTIONS AND STOCK APPRECIATION RIGHTS
Each Option granted hereunder shall be on the following terms and
conditions:
8.01 Stock Option Agreement. The proper Officers on behalf of the
Corporation and each Optionee shall execute a Stock Option Agreement which shall
set forth the total number of shares of Common Stock to which it pertains, the
exercise price, whether it is a Non-Qualified Option or an Incentive Stock
Option, and such other terms, conditions, restrictions and privileges as the
Board of Directors or the Committee in each instance shall deem appropriate,
provided they are not inconsistent with the terms, conditions and provisions of
this Plan. Each Optionee shall receive a copy of his executed Stock Option
Agreement.
8.02 Awards to Employees and Non-Employee Directors. Specific Awards to
Employees and Non-Employee Directors shall be made to such persons and in such
amounts as are determined by the Board of Directors or the Committee.
8.03 Option Exercise Price.
(a) Incentive Stock Options. The per share price at which the
subject Common Stock may be purchased upon exercise of an Incentive Stock Option
shall be no less than one hundred percent (100%) of the Fair Market Value of a
share of Common Stock at the time such Incentive Stock Option is granted, except
as provided in Section 8.10(b), and subject to any applicable adjustment
pursuant to Article IX hereof.
(b) Non-Qualified Options. The per share price at which the
subject Common Stock may be purchased upon exercise of a Non-Qualified Option
shall be no less than one hundred percent (100%) of the Fair Market Value of a
share of Common Stock at the time such Non-Qualified Option is granted, and
subject to any applicable adjustment pursuant to Article IX hereof.
8.04 Vesting and Exercise of Options.
(a) General Rules. Incentive Stock Options and Non-Qualified
Options granted hereunder shall become vested and exercisable at the rate, to
the extent and subject to such limitations as may be specified by the Board or
the Committee. Notwithstanding the foregoing, no vesting shall occur on or after
an Employee's employment with the Corporation and all Subsidiary Companies is
terminated for any reason other than his death, Disability or Retirement. In
determining the number of shares of Common Stock with respect to which Options
are vested and/or exercisable, fractional shares will be rounded up to the
nearest whole number if the fraction is 0.5 or higher, and down if it is less.
<PAGE>
(b) Accelerated Vesting. Unless the Committee shall specifically
state otherwise at the time an Option is granted, all Options granted hereunder
shall become vested and exercisable in full on the date an Optionee terminates
his employment with or service to the Corporation or a Subsidiary Company
because of his death, Disability or Retirement. In addition, all outstanding
options shall become immediately vested and exercisable in full in the event
that there is a Change in Control of the Corporation.
8.05 Duration of Options.
(a) General Rule. Except as provided in Sections 8.05(b) and
8.10, each Option or portion thereof granted to Employees and Non-Employee
Directors shall be exercisable at any time on or after it vests and becomes
exercisable until the earlier of (i) ten (10) years after its date of grant or
(ii) three (3) months after the date on which the Optionee ceases to be employed
(or in the service of the Board of Directors in the case of Non-Employee
Directors) by the Corporation and all Subsidiary Companies, unless the Board of
Directors or the Committee in its discretion decides at the time of grant or
thereafter to extend such period of exercise upon termination of employment or
service from three (3) months to a period not exceeding five (5) years.
(b) Exceptions. If an Employee dies while in the employ of the
Corporation or a Subsidiary Company or terminates employment with the
Corporation or a Subsidiary Company as a result of Disability or Retirement
without having fully exercised his Options, the Optionee or the executors,
administrators, legatees or distributees of his estate shall have the right,
during the twelve-month period following the earlier of his death or termination
due to Disability or Retirement, to exercise such Options. If a Non-Employee
Director dies while serving as a Non-Employee Director or terminates his service
to the Corporation or a Subsidiary Company as a result of Disability or
Retirement without having fully exercised his Options, the Non-Employee Director
or the executors, administrators, legatees or distributees of his estate shall
have the right, during the twelve-month period following the earlier of his
death or termination due to Disability or Retirement, to exercise such Options.
In no event, however, shall any Option be exercisable more than ten (10) years
from the date it was granted.
8.06 Nonassignability. Options shall not be transferable by an Optionee
except by will or the laws of descent or distribution, and during an Optionee's
lifetime shall be exercisable only by such Optionee or the Optionee's guardian
or legal representative. Notwithstanding the foregoing, or any other provision
of this Plan, an Optionee who holds Non-Qualified Options may transfer such
Options to his or her spouse, lineal ascendants, lineal descendants, or to a
duly established trust for the benefit of one or more of these individuals.
Options so transferred may thereafter be transferred only to the Optionee who
originally received the grant or to an individual or trust to whom the Optionee
could have initially transferred the Option pursuant to this Section 8.06.
Options which are transferred pursuant to this Section 8.06 shall be exercisable
by the transferee according to the same terms and conditions as applied to the
Optionee.
8.07 Manner of Exercise. Options may be exercised in part or in whole
and at one time or from time to time. The procedures for exercise shall be set
forth in the written Stock Option Agreement provided pursuant to Section 8.01.
<PAGE>
8.08 Payment for Shares. Payment in full of the purchase price for
shares of Common Stock purchased pursuant to the exercise of any Option shall be
made to the Corporation upon exercise of such Option. All shares sold under the
Plan shall be fully paid and nonassessable. Payment for shares may be made by
the Optionee in cash or, at the discretion of the Board of Directors or the
Committee, by delivering shares of Common Stock (including shares acquired
pursuant to the exercise of an Option) or other property equal in Fair Market
Value to the purchase price of the shares to be acquired pursuant to the Option,
by withholding some of the shares of Common Stock which are being purchased upon
exercise of an Option, or any combination of the foregoing. Notwithstanding the
foregoing, payment may also be made by delivering a properly executed exercise
notice together with irrevocable instructions to a broker to promptly deliver to
the Corporation the amount of sale or loan proceeds to pay the exercise price.
8.09 Voting and Dividend Rights. No Optionee shall have any voting or
dividend rights or other rights of a stockholder in respect of any shares of
Common Stock covered by an Option prior to the time that his name is recorded on
the Corporation's stockholder ledger as the holder of record of such shares
acquired pursuant to an exercise of such Option.
8.10 Additional Terms Applicable to Incentive Stock Options. All
Options issued under the Plan as Incentive Stock Options will be subject, in
addition to the terms detailed in Sections 8.01 to 8.09 above, to those
contained in this Section 8.10.
(a) Notwithstanding any contrary provisions contained elsewhere
in this Plan and as long as required by Section 422 of the Code, the aggregate
Fair Market Value, determined as of the time an Incentive Stock Option is
granted, of the Common Stock with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year under
this Plan, and stock options that satisfy the requirements of Section 422 of the
Code under any other stock option plan or plans maintained by the Corporation
(or any parent or Subsidiary Company), shall not exceed $100,000.
(b) Limitation on Ten Percent Stockholders. The price at which
shares of Common Stock may be purchased upon exercise of an Incentive Stock
Option granted to an individual who, at the time such Incentive Stock Option is
granted, owns, directly or indirectly, more than ten percent (10%) of the total
combined voting power of all classes of stock issued to stockholders of the
Corporation or any Subsidiary Company, shall be no less than one hundred and ten
percent (110%) of the Fair Market Value of a share of the Common Stock of the
Corporation at the time of grant, and such Incentive Stock Option shall by its
terms not be exercisable after the earlier of the date determined under Section
8.04 or the expiration of five (5) years from the date such Incentive Stock
Option is granted.
(c) Notice of Disposition; Withholding; Escrow. An Optionee shall
immediately notify the Corporation in writing of any sale, transfer, assignment
or other disposition (or action constituting a disqualifying disposition within
the meaning of Section 421 of the Code) of any shares of Common Stock acquired
through exercise of an Incentive Stock Option within two (2) years after the
grant of such Incentive Stock Option or within one (1) year after the
acquisition of such shares, setting forth the date and manner of disposition,
the number of shares disposed of and the price at which such shares were
disposed of. The Corporation shall be entitled to withhold from any compensation
or other payments then or thereafter due to the Optionee such amounts as may be
necessary to satisfy any withholding requirements of federal or state law or
<PAGE>
regulation and, further, to collect from the Optionee any additional amounts
which may be required for such purpose. The Committee may, in its discretion,
require shares of Common Stock acquired by an Optionee upon exercise of an
Incentive Stock Option to be held in an escrow arrangement for the purpose of
enabling compliance with the provisions of this Section 8.10(c).
8.11 Stock Appreciation Rights.
(a) General Terms and Conditions. The Board of Directors or the
Committee may, but shall not be obligated to, authorize the Corporation, on such
terms and conditions as it deems appropriate in each case, to grant rights to
Optionees to surrender an exercisable Option, or any portion thereof, in
consideration for the payment by the Corporation of an amount equal to the
excess of the Fair Market Value of the shares of Common Stock subject to the
Option, or portion thereof, surrendered over the exercise price of the Option
with respect to such shares (any such authorized surrender and payment being
hereinafter referred to as a "Stock Appreciation Right"). Such payment, at the
discretion of the Board of Directors or the Committee, may be made in shares of
Common Stock valued at the then Fair Market Value thereof, or in cash, or partly
in cash and partly in shares of Common Stock.
The terms and conditions of a Stock Appreciation Right may include
(without limitation), subject to other provisions of this Section 8.11 and the
Plan: the period during which, date by which or event upon which the Stock
Appreciation Right may be exercised (which shall be on the same terms as the
Option to which it relates pursuant to Section 8.04 hereunder); the method for
valuing shares of Common Stock for purposes of this Section 8.11; a ceiling on
the amount of consideration which the Corporation may pay in connection with
exercise and cancellation of the Stock Appreciation Right; and arrangements for
income tax withholding. The Board of Directors or the Committee shall have
complete discretion to determine whether, when and to whom Stock Appreciation
Rights may be granted.
(b) Time Limitations. If a holder of a Stock Appreciation Right
terminates service with the Corporation, the Stock Appreciation Right may be
exercised only within the period, if any, within which the Option to which it
relates may be exercised. Notwithstanding the foregoing, any election by an
Optionee to exercise the Stock Appreciation Rights provided in this Plan shall
be made during the period beginning on the third business day following the
release for publication of quarterly or annual financial information required to
be prepared and disseminated by the Corporation pursuant to the requirements of
the Exchange Act and ending on the twelfth business day following such date. The
required release of information shall be deemed to have been satisfied when the
specified financial data appears on or in a wire service, financial news service
or newspaper of general circulation or is otherwise first made publicly
available.
(c) Effects of Exercise of Stock Appreciation Rights or Options.
Upon the exercise of a Stock Appreciation Right, the number of shares of Common
Stock available under the Option to which it relates shall decrease by a number
equal to the number of shares for which the Stock Appreciation Right was
exercised. Upon the exercise of an Option, any related Stock Appreciation Right
shall terminate as to any number of shares of Common Stock subject to the Stock
Appreciation Right that exceeds the total number of shares for which the Option
remains unexercised.
<PAGE>
(d) Time of Grant. A Stock Appreciation Right granted in
connection with an Incentive Stock Option must be granted concurrently with the
Option to which it relates, while a Stock Appreciation Right granted in
connection with a Non-Qualified Option may be granted concurrently with the
Option to which it relates or at any time thereafter prior to the exercise or
expiration of such Option.
(e) Non-Transferable. The holder of a Stock Appreciation Right
may not transfer or assign the Stock Appreciation Right otherwise than by will
or in accordance with the laws of descent and distribution, and during a
holder's lifetime a Stock Appreciation Right may be exercisable only by the
holder.
ARTICLE IX
ADJUSTMENTS FOR CAPITAL CHANGES
The aggregate number of shares of Common Stock available for issuance
under this Plan, the number of shares to which any outstanding Award relates,
the maximum number of shares that can be covered by Awards to each Employee,
each Non-Employee Director and all Non-Employee Directors as a group, and the
exercise price per share of Common Stock under any outstanding Option shall be
proportionately adjusted for any increase or decrease in the total number of
outstanding shares of Common Stock issued subsequent to the effective date of
this Plan resulting from a split, subdivision or consolidation of shares or any
other capital adjustment, the payment of a stock dividend, or other increase or
decrease in such shares effected without receipt or payment of consideration by
the Corporation. If, upon a merger, consolidation, reorganization, liquidation,
recapitalization or the like of the Corporation, the shares of the Corporation's
Common Stock shall be exchanged for other securities of the Corporation or of
another corporation, each recipient of an Award shall be entitled, subject to
the conditions herein stated, to purchase or acquire such number of shares of
Common Stock or amount of other securities of the Corporation or such other
corporation as were exchangeable for the number of shares of Common Stock of the
Corporation which such optionees would have been entitled to purchase or acquire
except for such action, and appropriate adjustments shall be made to the per
share exercise price of outstanding Options. In the event the Corporation
declares a special cash dividend or return of capital in an amount per share
which exceeds 10% of the fair market value of a share of Common Stock as of the
date of declaration, the per share exercise price of all previously granted
Awards which remain unexercised as of the date of such declaration shall be
proportionately adjusted to give effect to such special cash dividend or return
of capital as of the date of payment of such special cash dividend or return of
capital; provided that the adjustments to the per share exercise price shall
satisfy the criteria set forth in Emerging Issues Task Force 90-9 (or any
successor thereto) so that the adjustments do not result in compensation
expense, and provided further that if such adjustment with respect to incentive
stock options would be treated as a modification of the outstanding incentive
stock options with the effect that, for purposes of Section 422 and 425(h) of
the Code, and the rules and regulations thereunder, new incentive stock options
would be deemed to be granted, then no adjustment to the per share exercise
price of outstanding incentive stock options shall be made.
<PAGE>
ARTICLE X
AMENDMENT AND TERMINATION OF THE PLAN
The Board may, by resolution, at any time terminate or amend the Plan
with respect to any shares of Common Stock as to which Awards have not been
granted, subject to any applicable regulatory requirements and any required
stockholder approval or any stockholder approval which the Board may deem to be
advisable for any reason, such as for the purpose of obtaining or retaining any
statutory or regulatory benefits under tax, securities or other laws or
satisfying any applicable stock exchange listing requirements. The Board may
not, without the consent of the holder of an Award, alter or impair any Award
previously granted or awarded under this Plan except as specifically authorized
herein.
ARTICLE XI
EMPLOYMENT RIGHTS
Neither the Plan nor the grant of any Awards hereunder nor any action
taken by the Committee or the Board in connection with the Plan shall create any
right on the part of any Employee or Non-Employee Director of the Corporation or
a Subsidiary Company to continue in such capacity.
ARTICLE XII
WITHHOLDING
12.01 Tax Withholding. The Corporation may withhold from any cash
payment made under this Plan sufficient amounts to cover any applicable
withholding and employment taxes, and if the amount of such cash payment is
insufficient, the Corporation may require the Optionee to pay to the Corporation
the amount required to be withheld as a condition to delivering the shares
acquired pursuant to an Award. The Corporation also may withhold or collect
amounts with respect to a disqualifying disposition of shares of Common Stock
acquired pursuant to the exercise of an Incentive Stock Option, as provided in
Section 8.10(c).
12.02 Methods of Tax Withholding. The Board of Directors or the
Committee is authorized to adopt rules, regulations or procedures which provide
for the satisfaction of an Optionee's tax withholding obligation by the
retention of shares of Common Stock to which the Employee would otherwise be
entitled pursuant to an Award and/or by the Optionee's delivery of
previously-owned shares of Common Stock or other property.
ARTICLE XIII
EFFECTIVE DATE OF THE PLAN; TERM
13.01 Effective Date of the Plan. This Plan shall become effective on
the Effective Date, and Awards may be granted hereunder as of or after the
Effective Date and prior to the termination of the Plan, provided that no
Incentive Stock Option issued pursuant to this Plan shall qualify as such unless
this Plan is approved by the requisite vote of the holders of the outstanding
voting shares of the Corporation at a meeting of stockholders of the Corporation
held within twelve (12) months of the Effective Date.
<PAGE>
13.02 Term of the Plan. Unless sooner terminated, this Plan shall remain
in effect for a period of ten (10) years ending on the tenth anniversary of the
adoption of this Plan by the Board of Directors, which date of adoption was June
11, 1997. Termination of the Plan shall not affect any Awards previously
granted, and such Awards shall remain valid and in effect until they have been
fully exercised or earned, are surrendered or by their terms expire or are
forfeited.
ARTICLE XIV
MISCELLANEOUS
14.01 Governing Law. To the extent not governed by federal law, this
Plan shall be construed under the laws of the State of Louisiana.
14.02 Pronouns. Wherever appropriate, the masculine pronoun shall
include the feminine pronoun, and the singular shall include the plural.
<PAGE>
APPENDIX B
ALGIERS BANCORP, INC.
1997 RECOGNITION AND RETENTION PLAN AND TRUST AGREEMENT
ARTICLE I
ESTABLISHMENT OF THE PLAN AND TRUST
1.01 Algiers Bancorp, Inc. (the "Corporation") hereby establishes the
1997 Recognition and Retention Plan (the "Plan") and Trust (the "Trust") upon
the terms and conditions hereinafter stated in this 1997 Recognition and
Retention Plan and Trust Agreement (the "Agreement").
1.02 The Trustee hereby accepts this Trust and agrees to hold the Trust
assets existing on the date of this Agreement and all additions and accretions
thereto upon the terms and conditions hereinafter stated.
ARTICLE II
PURPOSE OF THE PLAN
2.01 The purpose of the Plan is to retain personnel of experience and
ability in key positions by providing Employees and Non-Employee Directors of
the Corporation and of Algiers Homestead Association (the "Association") with a
proprietary interest in the Corporation as compensation for their contributions
to the Corporation, the Association, and any other Subsidiaries and as an
incentive to make such contributions in the future.
ARTICLE III
DEFINITIONS
The following words and phrases when used in this Agreement with an
initial capital letter, unless the context clearly indicates otherwise, shall
have the meanings set forth below. Wherever appropriate, the masculine pronouns
shall include the feminine pronouns and the singular shall include the plural.
3.01 "Beneficiary" means the person or persons designated by a Recipient
to receive any benefits payable under the Plan in the event of such Recipient's
death. Such person or persons shall be designated in writing on forms provided
for this purpose by the Committee and may be changed from time to time by
similar written notice to the Committee. In the absence of a written
designation, the Beneficiary shall be the Recipient's surviving spouse, if any,
or if none, his estate.
3.02 "Board" means the Board of Directors of the Corporation.
3.03 "Change in Control of the Corporation" shall be deemed to have
occurred if: (i) any "person," as such term is used in Sections 13(d) and 14(d)
of the Exchange Act (other than the Corporation and any trustee or other
fiduciary holding securities under any employee benefit plan of the
Corporation), is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the
Corporation representing 20% or more of the combined voting power of the
Corporation's then outstanding securities; (ii) during any period of three
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors, and any new director whose election by the Board of
Directors or nomination for election by the Corporation's stockholders was
approved by a vote of at least two-thirds of the directors then still in office
<PAGE>
who either were directors at the beginning of the three-year period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute at least a majority of the Board of Directors; (iii) the
stockholders of the Corporation approve a merger or consolidation of the
Corporation with any other corporation, other than a merger or consolidation
that would result in the voting securities of the Corporation outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the combined voting power of the voting securities of
the surviving corporation outstanding immediately after such merger or
consolidation; or (iv) the stockholders of the Corporation approve a plan of
complete liquidation of the Corporation or an agreement for the sale or
disposition by the Corporation of all or substantially all of the Corporation's
assets. If any of the events enumerated in clauses (i) through (iv) occur, the
Board shall determine the effective date of the Change in Control resulting
therefrom for purposes of the Plan.
3.04 "Code" means the Internal Revenue Code of 1986, as amended.
3.05 "Committee" means the committee appointed by the Board pursuant to
Article IV hereof.
3.06 "Common Stock" means shares of the common stock, par value $.01
per share, of the Corporation.
3.07 "Disability" means any physical or mental impairment which
qualifies an Employee for disability benefits under the applicable long-term
disability plan maintained by the Corporation or any Subsidiary or, if no such
plan applies, which would qualify such Employee for disability benefits under
the Federal Social Security System.
3.08 "Effective Date" means the date this Plan is approved by the
stockholders of the Corporation, which shall not be earlier than the one-year
anniversary of the consummation of the Association's conversion from mutual to
stock form pursuant to the Plan of Conversion adopted by the Association.
3.09 "Employee" means any person who is employed by the Corporation,
the Association or any Subsidiary, or is an officer of the Corporation, the
Association or any Subsidiary, including officers or other employees who may be
directors of the Corporation.
3.10 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
3.11 "Non-Employee Director" means a member of the Board who is not an
Employee. No honorary directors, advisory directors or directors emeritus shall
be entitled to receive Plan Share Awards under this Plan.
3.12 "Plan Shares" or "Shares" means shares of Common Stock held in the
Trust which may be distributed to a Recipient pursuant to the Plan.
3.13 "Plan Share Award" or "Award" means a right granted under this
Plan to receive a distribution of Plan Shares upon completion of the service
requirements described in Article VII.
3.14 "Recipient" means an Employee or Non-Employee Director who
receives a Plan Share Award under the Plan.
<PAGE>
3.15 "Retirement" means a termination of employment upon or after
attainment of age sixty-five (65) or such earlier age as may be specified in
applicable plans or policies of the Corporation, a Subsidiary or in a
Recipient's Plan Share Award.
3.16 "Subsidiary" means Algiers Homestead Association and any other
subsidiaries of the Corporation or the Association which, with the consent of
the Board, agree to participate in this Plan.
3.17 "Trustee" means such firm, entity or persons approved by the Board
of Directors to hold legal title to the Plan for the purposes set forth herein.
ARTICLE IV
ADMINISTRATION OF THE PLAN
4.01 Role of the Committee. The Plan shall be administered and
interpreted by the Committee, which shall consist of two or more members of the
Board, each of whom shall be a Non-Employee Director as defined in Rule
16b-3(b)(3)(i) of the Exchange Act. The Committee shall have all of the powers
allocated to it in this and other sections of the Plan. The interpretation and
construction by the Committee of any provisions of the Plan or of any Plan Share
Award granted hereunder shall be final and binding in the absence of action by
the Board of Directors. The Committee shall act by vote or written consent of a
majority of its members. Subject to the express provisions and limitations of
the Plan, the Committee may adopt such rules, regulations and procedures as it
deems appropriate for the conduct of its affairs. The Committee shall report its
actions and decisions with respect to the Plan to the Board at appropriate
times, but in no event less than one time per calendar year.
4.02 Role of the Board. The members of the Committee and the Trustee
shall be appointed or approved by, and will serve at the pleasure of, the Board.
The Board may in its discretion from time to time remove members from, or add
members to, the Committee, and may remove or replace the Trustee, provided that
any directors who are selected as members of the Committee shall be Non-Employee
Directors as defined in Rule 16b-3(b)(3)(i) of the Exchange Act.
4.03 Limitation on Liability. No member of the Board or the Committee
shall be liable for any determination made in good faith with respect to the
Plan or any Plan Shares or Plan Share Awards granted under it. If a member of
the Board or the Committee is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of anything done or not
done by him in such capacity under or with respect to the Plan, the Corporation
shall, subject to the requirements of applicable laws and regulations, indemnify
such member against all liabilities and expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding if he acted in good
faith and in a manner he reasonably believed to be in the best interests of the
Corporation and any Subsidiaries and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.
4.04 Compliance with Laws and Regulations. All Awards granted hereunder
shall be subject to all applicable federal and state laws, rules and regulations
and to such approvals by any government or regulatory agency as may be required.
The Corporation shall not be required to issue or deliver any certificates for
shares of Common Stock prior to the completion of any registration or
<PAGE>
qualification of or obtaining of consents or approvals with respect to such
shares under any federal or state law or any rule or regulation of any
government body, which the Corporation shall, in its sole discretion, determine
to be necessary or advisable.
ARTICLE V
CONTRIBUTIONS
5.01 Amount and Timing of Contributions. The Board shall determine the
amount (or the method of computing the amount) and timing of any contributions
by the Corporation and any Subsidiaries to the Trust established under this
Plan. Such amounts may be paid in cash or in shares of Common Stock and shall be
paid to the Trust at the designated time of contribution. No contributions by
Employees or Non-Employee Directors shall be permitted.
5.02 Investment of Trust Assets; Number of Plan Shares. Subject to
Section 8.02 hereof, the Trustee shall invest all of the Trust's assets
primarily in Common Stock. The aggregate number of Plan Shares available for
distribution pursuant to this Plan shall be 25,921 shares of Common Stock,
subject to adjustment as provided in Section 9.01 hereof, which shares shall be
purchased from the Corporation and/or from stockholders thereof by the Trust
with funds contributed by the Corporation. In the event that the Trust receives
cash pursuant to receipt of dividends on Common Stock held by the Trust and
unallocated to participants, including the receipt of a special cash dividend or
return of capital, then such funds may be used by the Trust to purchase
additional shares of Common Stock available for future award under this Plan or
the Committee or Board may distribute such cash received by the Trust along with
the Common Stock upon which it was earned upon the award of such previously
unallocated shares. With respect to dividends or returns of capital received by
the Trust with respect to Plan Share Awards that have not yet vested, the Trust
shall either (a) distribute such cash, including any interest therein, to the
Recipient of the Award on a pro rata basis as the Award becomes earned or (b)
purchase additional shares of Common Stock with such cash, which shares shall
then be distributed to the Recipient of the Award on a pro rata basis as the
Award becomes earned, or any combination of the foregoing.
ARTICLE VI
ELIGIBILITY; ALLOCATIONS
6.01 Awards to Non-Employee Directors. Plan Share Awards to
Non-Employee Directors shall be made to such persons and in such amounts as
determined by the Board of Directors or the Committee. Notwithstanding anything
contained in this Plan to the contrary, the maximum number of Plan Shares to
which Awards may be granted under this Plan to (a) any Non-Employee Director
shall be 1,296 and (b) all Non-Employee Directors as a group shall be 7,776,
subject to any applicable adjustment pursuant to Section 9.01 hereof.
6.02 Awards to Employees. Plan Share Awards may be made to such
Employees as may be selected by the Board of Directors or the Committee. In
selecting those Employees to whom Plan Share Awards may be granted and the
number of Shares covered by such Awards, the Committee or the Board shall
consider the duties, responsibilities and performance of each respective
Employee, his present and potential contributions to the growth and success of
the Corporation, his salary and such other factors as shall be deemed relevant
to accomplishing the purposes of the Plan. The Board of Directors or the
<PAGE>
Committee may but shall not be required to request the written recommendation of
the Chief Executive Officer of the Corporation other than with respect to Plan
Share Awards to be granted to him. Notwithstanding anything contained in this
Plan to the contrary, the maximum number of Plan Shares to which Awards may be
granted under this Plan to any Employee shall be 6,480, subject to any
applicable adjustment pursuant to Section 9.01 hereof.
6.03 Form of Allocation. As promptly as practicable after a
determination is made pursuant to Sections 6.01 or 6.02 that a Plan Share Award
is to be issued, the Board of Directors or the Committee shall notify the
Recipient in writing of the grant of the Award, the number of Plan Shares
covered by the Award, the terms upon which the Plan Shares subject to the Award
shall be distributed to the Recipient, and the rate at which the Plan Share
Award shall become vested. The date on which the Board of Directors or the
Committee makes the determination with respect to Plan Share Awards shall be
considered the date of grant of the Plan Share Award. The Board of Directors or
the Committee shall maintain records as to all grants of Plan Share Awards under
the Plan.
6.04 Allocations Not Required to any Specific Non-Employee Director or
Employee. Notwithstanding anything to the contrary in Sections 6.01 and 6.02
hereof, no Non-Employee Director or Employee shall have any right or entitlement
to receive a Plan Share Award hereunder, such Awards being at the total
discretion of the Board of Directors or the Committee.
ARTICLE VII
EARNING AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS
7.01 Earning Plan Shares; Forfeitures.
(a) General Rules. Subject to the terms hereof, Plan Share Awards
shall be earned by a Recipient at the rate determined by the Board of Directors
or the Committee pursuant to Article VI hereof. If the employment of an Employee
or service as a Non-Employee Director is terminated prior to the date such
Awards are vested for any reason (except as specifically provided in subsections
(b), (c) and (d) below), the Recipient shall forfeit the right to any Shares
subject to the Award which have not theretofore been earned. In the event of a
forfeiture of the right to any Shares subject to an Award by a Recipient, such
forfeited Shares shall become available for allocation pursuant to this Plan as
if no Award had been previously granted with respect to such Shares. No
fractional shares shall be distributed pursuant to this Plan.
(b) Exception for Terminations Due to Death, Disability or
Retirement. Notwithstanding the general rule contained in Section 7.01(a), all
Plan Shares subject to a Plan Share Award held by a Recipient whose employment
with or service to the Corporation or any Subsidiary terminates due to death,
Disability or Retirement shall be deemed earned as of the Recipient's last day
of employment with or service to the Corporation or any Subsidiary and shall be
distributed as soon as practicable thereafter.
(c) Exception for Terminations after a Change in Control of the
Corporation. Notwithstanding the general rule contained in Section 7.01(a), all
Plan Shares subject to a Plan Share Award held by a Recipient shall be deemed to
be earned in the event of a Change in Control of the Corporation.
<PAGE>
(d) Revocation for Misconduct. Notwithstanding anything in this
Plan to the contrary, the Board may by resolution immediately revoke, rescind
and terminate any Plan Share Award, or portion thereof, previously awarded under
this Plan, to the extent Plan Shares have not yet been earned, in the case of an
Employee who is discharged from the employ of the Corporation or any Subsidiary
for cause (as hereinafter defined). Termination for cause shall mean termination
because of the Employee's 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.
Plan Share Awards granted to a Non-Employee Director who is removed for cause
pursuant to the Corporation's Articles of Incorporation shall terminate as of
the effective date of such removal.
7.02 Distribution of Dividends. Any cash dividends, stock dividends or
returns of capital declared in respect of each unvested Plan Share Award will be
held by the Trust for the benefit of the Recipient on whose behalf such Plan
Share Award is then held by the Trust, and such dividends or return of capital,
including any interest thereon, will be paid out proportionately by the Trust to
the Recipient thereof as soon as practicable after the Plan Share Awards become
earned, either in the form of cash or (if such cash is used by the Trust to
purchase additional shares of Common Stock pursuant to Section 5.02 hereof)
shares of Common Stock. Any cash dividends, stock dividends or returns of
capital declared in respect of each vested Plan Share held by the Trust will be
paid by the Trust, as soon as practicable after the Trust's receipt thereof, to
the Recipient on whose behalf such Plan Share is then held by the Trust. In the
event that the Trust receives cash pursuant to the receipt of dividends or
returns of capital on the Common Stock held by the Trust and unallocated to
participants, then such funds may be used by the Trust to purchase additional
shares of Common Stock available for future award under this Plan or the
Committee or the Board of Directors may distribute such cash received by the
Trust along with the Common Stock upon which it was earned upon the award of
such previously unallocated shares.
7.03 Distribution of Plan Shares.
(a) Timing of Distributions: General Rule. Except as provided in
Section 7.03(b) hereof, Plan Shares shall be distributed to the Recipient or his
Beneficiary, as the case may be, as soon as practicable after they have been
earned.
(b) Timing: Exception for 10% Stockholders. Notwithstanding
Section 7.03(a) above, no Plan Shares may be distributed prior to the date which
is five years from the date of consummation of the Association's conversion from
mutual to stock form to the extent the Recipient or Beneficiary, as the case may
be, would after receipt of such Shares own in excess of 10% of the issued and
outstanding shares of Common Stock. Any Plan Shares remaining undistributed
solely by reason of the operation of this Section 7.03(b) shall be distributed
to the Recipient or his Beneficiary on the date which is five years from the
date of consummation of the Association's conversion from mutual to stock form.
(c) Form of Distributions. All Plan Shares, together with any
Shares representing stock dividends, shall be distributed in the form of Common
Stock. One share of Common Stock shall be given for each Plan Share earned and
distributable. Payments representing cash dividends or returns of capital shall
be made in cash.
<PAGE>
(d) Withholding. The Trustee may withhold from any cash payment
or Common Stock distribution made under this Plan sufficient amounts to cover
any applicable withholding and employment taxes, and if the amount of a cash
payment is insufficient, the Trustee may require the Recipient or Beneficiary to
pay to the Trustee the amount required to be withheld as a condition of
delivering the Plan Shares. The Trustee shall pay over to the Corporation or any
Subsidiary which employs or employed such Recipient any such amount withheld
from or paid by the Recipient or Beneficiary.
(e) Restrictions on Selling of Plan Shares. Plan Share Awards may
not be sold, assigned, pledged or otherwise disposed of prior to the time that
they are earned and distributed pursuant to the terms of this Plan. Following
distribution, the Board of Directors or the Committee may require the Recipient
or his Beneficiary, as the case may be, to agree not to sell or otherwise
dispose of his distributed Plan Shares except in accordance with all then
applicable federal and state securities laws, and the Board of Directors or the
Committee may cause a legend to be placed on the stock certificate(s)
representing the distributed Plan Shares in order to restrict the transfer of
the distributed Plan Shares for such period of time or under such circumstances
as the Board of Directors or the Committee, upon the advice of counsel, may deem
appropriate.
7.04 Voting of Plan Shares. After a Plan Share Award has been made, the
Recipient shall be entitled to direct the Trustee as to the voting of the Plan
Shares which are covered by the Plan Share Award and which have not yet been
earned and distributed to him, subject to rules and procedures adopted by the
Committee for this purpose. If the Recipient does not direct the Trustee as to
the voting of Plan Shares covered by unvested Awards granted to him, such shares
shall not be voted by the Trustee. All shares of Common Stock held by the Trust
which have not been awarded under a Plan Share Award shall be voted by the
Trustee in the same proportion for and against proposals to stockholders as the
Recipients actually vote unvested Plan Shares covered by Awards granted to them.
Any unvested Plan Shares covered by Awards which either abstain on the proposal
or are not voted will be disregarded in determining the percentage of stock
voted for and against each proposal by the Recipients.
ARTICLE VIII
TRUST
8.01 Trust. The Trustee shall receive, hold, administer, invest and
make distributions and disbursements from the Trust in accordance with the
provisions of the Plan and Trust and the applicable directions, rules,
regulations, procedures and policies established by the Board of Directors or
the Committee pursuant to the Plan.
8.02 Management of Trust. It is the intent of this Plan and Trust that
the Trustee shall have complete authority and discretion with respect to the
arrangement, control and investment of the Trust, and that the Trustee shall
invest all assets of the Trust in Common Stock to the fullest extent
practicable, except to the extent that the Trustee determines that the holding
of monies in cash or cash equivalents is necessary to meet the obligations of
the Trust. In performing their duties, the Trustee shall have the power to do
all things and execute such instruments as may be deemed necessary or proper,
including the following powers:
<PAGE>
(a) To invest up to one hundred percent (100%) of all Trust
assets in Common Stock without regard to any law now or hereafter in force
limiting investments for trustees or other fiduciaries. The investment
authorized herein may constitute the only investment of the Trust, and in making
such investment, the Trustee is authorized to purchase Common Stock from the
Corporation or from any other source, and such Common Stock so purchased may be
outstanding, newly issued or treasury shares.
(b) To invest any Trust assets not otherwise invested in
accordance with (a) above, in such deposit accounts, certificates of deposit,
obligations of the United States Government or its agencies or such other
investments as shall be considered the equivalent of cash.
(c) To sell, exchange or otherwise dispose of any property at any
time held or acquired by the Trust.
(d) To cause stocks, bonds or other securities to be registered
in the name of a nominee, without the addition of words indicating that such
security is an asset of the Trust (but accurate records shall be maintained
showing that such security is an asset of the Trust).
(e) To hold cash without interest in such amounts as may in the
opinion of the Trustee be reasonable for the proper operation of the Plan and
Trust.
(f) To employ brokers, agents, custodians, consultants and
accountants.
(g) To hire counsel to render advice with respect to their
rights, duties and obligations hereunder, and such other legal services or
representation as the Trustee deems desirable.
(h) To hold funds and securities representing the amounts to be
distributed to a Recipient or his Beneficiary as a consequence of a dispute as
to the disposition thereof, whether in a segregated account or held in common
with other assets of the Trust.
Notwithstanding anything herein contained to the contrary, the Trustee
shall not be required to make any inventory, appraisal or settlement or report
to any court, or to secure any order of a court for the exercise of any power
herein contained, or to give any bond.
8.03 Records and Accounts. The Trustee shall maintain accurate and
detailed records and accounts of all transactions of the Trust, which shall be
available at all reasonable times for inspection by any legally entitled person
or entity to the extent required by applicable law, or any other person
determined by the Board of Directors or the Committee.
8.04 Expenses. All costs and expenses incurred in the operation and
administration of this Plan shall be borne by the Corporation or, in the
discretion of the Corporation, the Trust.
8.05 Indemnification. Subject to the requirements of applicable laws
and regulations, the Corporation shall indemnify, defend and hold the Trustee
harmless against all claims, expenses and liabilities arising out of or related
to the exercise of the Trustee's powers and the discharge of its duties
hereunder, unless the same shall be due to the Trustee's gross negligence or
willful misconduct.
<PAGE>
ARTICLE IX
MISCELLANEOUS
9.01 Adjustments for Capital Changes. The aggregate number of Plan
Shares available for distribution pursuant to the Plan Share Awards, the number
of Shares to which any Plan Share Award relates and the maximum number of Plan
Shares which may be granted to any Employee, to any Non-Employee Director or to
all Non-Employee Directors as a group shall be proportionately adjusted for any
increase or decrease in the total number of outstanding shares of Common Stock
subsequent to the date this Plan was adopted by the Board of Directors resulting
from any split, subdivision or consolidation of shares or other capital
adjustment, or other increase or decrease in such shares effected without
receipt or payment of consideration by the Corporation.
9.02 Amendment and Termination of the Plan. The Board may, by
resolution, at any time amend or terminate the Plan and the Trust (including
amendments which may result in the merger of the Plan or the Trust with and into
other plans or trusts of the Corporation or any successor thereto), subject to
any applicable regulatory requirements and any required stockholder approval or
any stockholder approval which the Board of Directors may deem to be advisable
for any reason, such as for the purpose of obtaining or retaining any statutory
or regulatory benefits under tax, securities or other laws or satisfying any
applicable stock exchange listing requirements. The Board may not, without the
consent of the Recipient, alter or impair any Plan Share Award previously
granted under this Plan except as specifically authorized herein. Termination of
this Plan shall not affect Plan Share Awards previously granted, and such Plan
Share Awards shall remain valid and in effect until they (a) have been fully
earned, (b) are surrendered, or (c) expire or are forfeited in accordance with
their terms.
9.03 Nontransferable. During the lifetime of the Recipient, Plan Shares
may only be earned by and paid to the Recipient who was notified in writing of
the Award pursuant to Section 6.03, provided that Plan Share Awards and rights
to Plan Shares shall be transferable by a Recipient to his or her spouse, lineal
ascendants, lineal descendants, or to a duly established trust. Plan Share
Awards so transferred may not again be transferred other than to the Recipient
who originally received the grant of Plan Share Awards or to an individual or
trust to whom such Recipient could have transferred Plan Share Awards pursuant
to this Section 9.03. Plan Share Awards which are transferred pursuant to this
Section 9.03 shall be subject to the same terms and conditions as would have
applied to such Plan Share Awards in the hands of the Recipient who originally
received the grant of such Plan Share Award. No Recipient or Beneficiary shall
have any right in or claim to any assets of the Plan or Trust, nor shall the
Corporation or any Subsidiary be subject to any claim for benefits hereunder.
9.04 Employment or Service Rights. Neither the Plan nor any grant of a
Plan Share Award or Plan Shares hereunder nor any action taken by the Trustee,
the Committee or the Board in connection with the Plan shall create any right on
the part of any Employee or Non-Employee Director to continue in such capacity.
9.05 Voting and Dividend Rights. No Recipient shall have any voting or
dividend rights or other rights of a stockholder in respect of any Plan Shares
covered by a Plan Share Award, except as expressly provided in Sections 7.02 and
7.04 above, prior to the time said Plan Shares are actually earned and
distributed to him.
9.06 Governing Law. To the extent not governed by federal law, the Plan
and Trust shall be governed by the laws of the State of Louisiana.
<PAGE>
9.07 Effective Date. This Plan shall be effective as of the Effective
Date, and Awards may be granted hereunder as of or after the Effective Date and
as long as the Plan remains in effect.
9.08 Term of the Plan. This Plan shall remain in effect until the
earlier of (1) ten (10) years from the Effective Date, (2) termination by the
Board, or (3) the distribution to Recipients and Beneficiaries of all assets of
the Trust.
9.09 Tax Status of the Trust. It is intended that the trust established
hereby be treated as a Grantor Trust of the Corporation under the provisions of
Section 671 et seq. of the Code, as the same may be amended from time to time.
IN WITNESS WHEREOF, the Corporation has caused this Agreement to be
executed by its duly authorized officers and its corporate seal to be affixed
and duly attested, and the initial Trustee established pursuant hereto has duly
and validly executed this Agreement, all on this ____ day of June 1997.
ALGIERS BANCORP, INC.
By:
------------------------
Hugh E. Humphrey, Jr.
President and Chief Executive Officer
ATTEST:
By:
------------------------
Hugh E. Humphrey, III
Secretary
TRUSTEES
By: -------------------------
Trustee
By: -------------------------
Trustee
<PAGE>
REVOCABLE PROXY
ALGIERS BANCORP, INC.
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF ALGIERS
BANCORP, INC. (THE "COMPANY") FOR USE AT THE SPECIAL MEETING OF STOCKHOLDERS TO
BE HELD ON JULY18, 1997 AND AT ANY ADJOURNMENT THEREOF.
The undersigned hereby appoints the Board of Directors of the Company, or any
successors thereto as proxies, with full powers of substitution, to vote the
shares of the undersigned at the Special Meeting of Stockholders of theCompany
to be held at the Main Office located at #1 Westbank Expressway, New Orleans,
Louisiana, on July 18, 1997 at 10:00 a.m., Central Time, and at any adjournment
thereof, with all the powers that the undersigned would possess if personally
present, as follows:
1. Proposal to approve the 1997 Stock Option Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. Proposal to approve the 1997 Recognition and Retention Plan and Trust
Agreement.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
In their discretion, the proxies are authorized to vote with respect to
approval of the minutes of the last meeting of stockholders, matters incident to
the conduct of the meeting, and upon such other matters as may properly come
before the meeting.
The Board of Directors recommends that you vote FOR Proposals 1 and 2. Shares
of common stock of the Company will be voted as specified. If no specification
is made, shares will be voted for Proposals 1 and 2 and otherwise at the
discretion of the proxies. This proxy may be revoked at any time before it is
exercised.
The undersigned hereby acknowledges receipt of the Notice of Special Meeting
of the Stockholders of the Company called for July 18, 1997, and a Proxy
Statement for the Special Meeting.
Please sign this exactly as your name(s) appear(s) on this proxy card. When
signing in a representative capacity, please give title. When shares are held
jointly, only one holder need sign.
<PAGE>
Please be sure to sign and date
this Proxy in the box below.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
ALGIERS BANCORP, INC.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
