U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act
of 1934.
For the quarterly period ended June 30, 1998.
[_] Transition report under Section 13 or 15(d) of the Exchange Act
of 1934.
For the transition period from to .
------------ ------------
Commission file number 000-22925
AMERICASBANK CORP.
(Exact Name of Small Business Issuer as Specified in Its Charter)
Maryland 52-1948980
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
3621 East Lombard Street, Baltimore, Maryland 21224
---------------------------------------------------
(Address of Principal Executive Offices)
(410) 342-8303
--------------
(Issuer's Telephone Number, Including Area Code)
---------------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year, if Changed
Since Last Report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No
----- -----
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: As of July 31, 1998, there
were 300,000 shares of Issuer's $.01 par value common stock outstanding.
Transitional Small Business Disclosure Format (check one):
Yes X No
----- -----
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
AMERICASBANK CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF JUNE 30, 1998 AND DECEMBER 31, 1997
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
------------ ------------
(unaudited)
<S><C>
Assets
Cash and cash equivalents:
On-hand and due from banks $ 93,000 $ 155,000
Interest-bearing accounts 15,000 31,000
Federal funds sold 2,945,000 3,151,000
Investment securities, available for sale 531,000 569,000
Loans receivable, net 6,562,000 6,251,000
Investment in Federal Home Loan Bank stock, at cost 54,000 54,000
Accrued interest receivable 61,000 51,000
Property and equipment, net 744,000 746,000
Organizational costs, net 118,000 133,000
Other assets, net 262,000 279,000
----------- -----------
Total assets $11,385,000 $11,420,000
=========== ===========
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing $ 396,000 $ 952,000
Interest-bearing 7,996,000 7,444,000
Mortgage escrow deposits 202,000 119,000
Accrued interest on deposits - 32,000
Accounts payable and accrued expenses 72,000 62,000
---------- ----------
Total liabilities $8,666,000 $8,609,000
---------- ----------
Stockholders' Equity:
Preferred stock, par value $0.01 per share,
5,000,000 shares authorized, 0 shares issued
and outstanding
Common stock, par value $0.01 per share,
5,000,000 shares authorized, 300,000 shares
issued and outstanding 3,000 3,000
Additional paid-in capital 2,847,000 2,847,000
Accumulated deficit (131,000) (39,000)
------------ -----------
Total stockholders' equity 2,719,000 2,811,000
------------ -----------
Total liabilities and stockholders' equity $11,385,000 $11,420,000
============ ===========
</TABLE>
The accompanying notes are an integral part of this consolidated balance sheet.
2
<PAGE>
AMERICASBANK CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATION
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30, Three Months Ended June 30,
------------------------- ---------------------------
1998 1997 1998 1997
---- ---- ---- ----
<S><C>
Interest Income:
Interest income on loans $ 311,000 $ - $ 160,000 $ -
Interest income on investment securities 84,000 11,000 45,000 9,000
--------- -------- --------- --------
Total interest income 395,000 11,000 205,000 9,000
Interest expense on deposits 180,000 - 93,000 -
--------- ------- --------- -------
Net interest income 215,000 11,000 112,000 9,000
Provision for loan losses 18,000 - 8,000 -
--------- ------- --------- -------
Net interest income after provision for
loan losses 197,000 11,000 104,000 9,000
--------- -------- --------- --------
Fees and service charges 7,000 - 5,000 -
--------- ------- --------- -------
Other operating expenses:
Salaries and benefits 62,000 - 30,000 -
Depreciation and amortization 71,000 - 37,000 -
Occupancy expense 10,000 - 4,000 -
Data processing 28,000 - 12,000 -
Professional fees 69,000 5,000 50,000 5,000
Office supplies 10,000 - 5,000 -
Other operating expenses 46,000 - 23,000 -
--------- ------- --------- -------
Total other operating expenses 296,000 5,000 161,000 5,000
--------- ------- --------- -------
(Loss) income before provision for
income taxes (92,000) 6,000 (52,000) 4,000
Provision for Income Taxes - - - -
--------- ------- --------- -------
Net (loss) income $ (92,000) $ 6,000 $ (52,000) $ 4,000
========= ======= ========= =======
Loss Per Common Share - Basic and Diluted $ (.31) $ - $ (.17) $ -
========= ======= ========= =======
Weighted Average Shares Outstanding 300,000 - 300,000 -
========= ======= ========= =======
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
3
<PAGE>
AMERICASBANK CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1998 1997
---- ----
<S><C>
Cash Flows from Operating Activities:
Net (loss) income $ (92,000) $ 6,000
Adjustments to reconcile net (loss) income
to net cash provided by operating activities-
Provision for loan losses 18,000 -
Depreciation and amortization 71,000 -
Increase in accrued interest receivable (10,000) (1,000)
Increase in other assets (16,000) -
Decrease in accrued interest on deposits (32,000) -
Increase in accounts payable and accrued expenses 10,000 5,000
----------- ---------
Net cash provided by (used in) operating
activities (51,000) 10,000
----------- ---------
Cash Flows from Investing Activities:
Sales of investment securities 38,000 -
Loan principal disbursements (1,143,000) -
Principal repayments on loans receivable 814,000 -
Purchase of property and equipment (21,000) -
Cash paid for organizational costs - (9,000)
----------- ---------
Net cash used in investing activities (312,000) (9,000)
----------- ---------
Cash Flows from Financing Activities:
Decrease in savings deposits (4,000) -
Increase in mortgage escrow deposits 83,000 -
Stock offering costs - (8,000)
Advances from related parties - 193,000
----------- ---------
Net cash (used in) provided from financing
activities 79,000 185,000
----------- ---------
(Decrease) Increase In Cash and Cash Equivalents (284,000) 186,000
Cash and Cash Equivalents, beginning of period 3,337,000 298,000
----------- ---------
Cash and Cash Equivalents, end of period $ 3,053,000 $ 484,000
=========== =========
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
4
<PAGE>
AMERICASBANK CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) Organization and Business
AmericasBank Corp. (the Company) was incorporated under the laws of the State of
Maryland on June 4, 1996 primarily to hold all the outstanding shares of capital
stock of a federal stock savings bank.
Effective November 30, 1997, the Company completed an initial public offering
(the Offering) in which it sold 300,000 shares of common stock for $10 per
share, less offering costs. On December 1, 1997, the Company acquired certain
assets and assumed certain deposit liabilities primarily related to the
Baltimore Branch of Rushmore Trust and Savings, FSB. Concurrent with the
acquisition, the branch commenced banking operations under the name AmericasBank
(the Bank) as a wholly-owned subsidiary of the Company. The Bank is a member of
the Federal Home Loan Bank System, and its deposits are insured by the Federal
Deposit Insurance Corporation.
As the Bank is a start-up operation, there can be no assurance that the Bank can
attract sufficient depositors or issue sufficient quality loans to operate at a
profit. The Bank is subject to other risks and uncertainties, including interest
rate risk. The interest rate risk related to interest rates is significant to
the Bank as its deposits have relatively short maturities, while the loans have
much longer maturities at fixed rates. Without a significant change in the
Bank's investment, deposit or loan portfolio, an increase in interest rates
could have a significant negative effect on the Bank's net interest income and
results of operations.
(2) Basis of Presentation
The financial statements included herein have been prepared by the Company,
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. However, the Company believes that the disclosures are adequate to
make the information presented not misleading. These condensed financial
statements should be read in conjunction with the financial statements and notes
thereto for the year ended December 31, 1997, included in the Company's Annual
Report on Form 10-KSB.
The unaudited condensed financial statements included herein reflect all
adjustments (which include only normal, recurring adjustments) which are, in
the opinion of management, necessary to state fairly the results for the six
months ended June 30, 1998 and 1997. The results of the interim periods are not
necessarily indicative of the results expected for the full fiscal year.
(3) Stock Options
On June 1, 1998, the Company adopted a stock option plan for the
granting of stock options to employees and nonemployee directors. The
5
<PAGE>
options are vested immediately and may be exercised six months after the grant
date. In the event of termination without cause, the stock options expire in
three months from the date of termination. Options granted to directors expire
on the first anniversary of the effective date of termination as a director. All
options expire on the 10th anniversary of the grant date.
As of June 30, 1998, 29,840 stock options have been issued at an option price of
$10.00 per share, which approximates management's estimate of the fair value of
the Company's common stock on the date of grant. No options have been exercised
as of June 30, 1998.
(4) Subsequent Event
On August 13, 1998, the Company filed a Registration Statement on Form SB-1 with
the Securities and Exchange Commission in connection with the offering by the
Company of a minimum of 125,000 units and a maximum of 312,500 units, each unit
consisting of one share of common stock and one common stock purchase warrant,
at a price of $12.00 per unit.
6
<PAGE>
Item 2. Plan of Operation
General
AmericasBank Corp. (the "Company") was incorporated under the laws of the
State of Maryland on June 4, 1996, primarily to own all of the outstanding
shares of capital stock of a federal stock savings bank to be named AmericasBank
(the "Bank"). On April 15, 1997, the Office of Thrift Supervision (the "OTS")
granted the Company the necessary approvals to acquire the capital stock of the
Bank and to become a savings and loan holding company of the Bank. The Company
acquired all of the Bank's capital stock and the Bank opened on December 1,
1997. The Bank currently has one branch in Baltimore, Maryland.
Effective as of December 1, 1997, the Bank also purchased certain assets
and assumed certain deposit liabilities primarily related to the Baltimore,
Maryland branch office of Rushmore Trust and Savings, FSB ("Rushmore"), located
at 3621 East Lombard Street, Baltimore, Maryland 21224 (the "Baltimore Branch").
The Company currently is classified as a non-diversified unitary savings
and loan holding company and, as such, the Company may engage in certain
non-banking activities that the OTS has deemed to be closely related to banking.
Although the Company has no present intention of engaging in any activity other
than owning all of the outstanding shares of capital stock of the Bank and the
outstanding shares of capital stock of AmericasBank Holdings Corporation, a
subsidiary formed to hold certain real property, if circumstances should lead
the Company's management to determine that it would be beneficial for the
Company to engage in other business activities, management of the Company would
have the flexibility to do so, subject to applicable regulatory requirements.
If the Conversion is consummated (see "Business Conducted by the Bank,"
below), the Company will become a bank holding company under the Bank Holding
Company Act of 1956, as amended, and generally would be limited to banking and
banking related activities.
As the Bank commenced operations as of December 1, 1997, the fiscal
quarter ended June 30, 1998 was only the second full fiscal quarter for which
the Bank was in operation. Prior to December 1, 1997, the Company and the Bank
were engaged in the activities necessary to organize the Bank and the Company.
7
<PAGE>
Business Conducted and to be Conducted by the Bank
The Bank is a community-oriented financial institution. Its business has
been to attract retail deposits and to seek to invest those deposits, together
with funds generated from operations and borrowings, in one-to four-family
mortgage loans. Over 80% of the loans acquired from Rushmore were one-to-four
family mortgage loans. To a lesser extent, the Bank has sought to invest in home
equity and second trust loans, multi-family loans, commercial real estate loans,
commercial business loans, construction and lot loans (primarily for one- to
four-family home construction for the borrower) and consumer loans. The Bank's
deposit base is comprised of traditional deposit products including checking
accounts, insured investment accounts, statement savings accounts, passbook
deposit accounts, money market accounts, certificates of deposit and individual
retirement accounts.
The Bank offers direct deposit of payroll and social security checks and
automatic drafts for various accounts to its customers. Although it did not do
so as of June 30, 1998, the Bank intends to offer its customers cash management
services, safe deposit boxes and travelers checks, and intends to become
associated with a network of automated teller machines that may be used by
customers of the Bank throughout Maryland and other regions.
Management has determined that as a result of recent consolidations of
financial institutions, the Bank's current and potential market areas are not
being adequately served by existing financial institutions and that there is an
increasing local demand for commercial real estate, commercial business,
construction and consumer loans offered by a truly community-oriented financial
institution. As a result, the Bank will seek to convert from a federal stock
savings bank to a Maryland commercial bank (the "Conversion"), and management
will seek to refocus the Bank's lending strategy. Pursuant to this strategy,
while continuing to pursue its existing business of seeking to originate
mortgage loans for the purpose of financing and refinancing one-to-four family
residential properties, the Bank intends to expand gradually its commercial real
estate, commercial business, construction and consumer lending.
The Conversion will require the approval of the Commissioner of Financial
Regulation of the State of Maryland (the "Commissioner"). Management believes
that to obtain the Commissioner's approval, the Company must, among other
things, raise additional capital. Management also believes that the Bank must
recruit a person with substantial experience in commercial banking to serve as
President of the Bank in order to implement the refocused lending strategy and
to enhance the Bank's management in connection with the Conversion.
8
<PAGE>
There can be no assurance that the Company will be able to raise the necessary
additional capital, that the necessary regulatory approvals will be obtained,
that management will be able to hire a new President or that the new President
will be able to successfully implement the refocused lending strategy. See
"Capital Resources," below.
Strategy
The Bank intends to pursue a strategy of long term growth by competing for
loans and deposits in its market area, establishing a new branch office in
Towson, Maryland and by opening additional branches, either through internal
growth or through acquisitions of existing financial institutions or branches
thereof.
On December 31, 1997, the Company's wholly owned subsidiary, AmericasBank
Holdings Corporation, purchased from NationsBank, N.A. ("NationsBank"), a
building located at 500 York Road, Towson, Maryland 21286 (the "Towson
Property"). Until July 1997, the Towson Property had served as a branch of
NationsBank. Subject to, among other things, regulatory approval, the Company
intends to utilize the Towson Property as a branch of the Bank. Management
believes that to obtain regulatory approval to open the Towson branch, the
Company must, among other things, raise additional capital. There can be no
assurance that the Company will be able to raise the necessary additional
capital or that the necessary regulatory approvals will be obtained.
See "Capital Resources," below.
The Bank's ability to expand internally by establishing new branch offices
will be dependent on the ability to identify advantageous locations for such
branches and to fund the development of new branches. The ability to grow
through selective acquisitions of other financial institutions or branches of
such institutions will be dependent on successfully identifying, acquiring and
integrating such institutions or branches. Furthermore, the success of the
branch expansion strategy will be dependent upon the Bank's access to capital,
its ability to attract and train or retain qualified employees and its ability
to obtain regulatory approvals. The branch expansion strategy anticipates losses
from branch operations until such time as branch deposits and the volume of
other banking business reach the levels necessary to support profitable branch
operations. At this time, other than the plan to open a Towson branch, the
Company and the Bank have no specific plans regarding new branch offices or
acquisitions of existing financial institutions or branches thereof.
There can be no assurance that the Bank will be able to generate internal
growth or identify attractive acquisition candidates, acquire such candidates on
favorable terms, or successfully integrate any
9
<PAGE>
acquired institutions or branches into its operations. In addition, the Bank's
inability to implement the branch expansion strategy could negatively impact the
Bank's long term ability to successfully compete in the marketplace.
The Company's executive offices and the Bank's current banking office are
located at 3621 East Lombard Street, Baltimore, Maryland 21224. Upon opening a
Towson branch, the Company's and the Bank's executive offices will move to the
Towson Property. Management anticipates that the Bank will draw most of its
customer deposits and conduct most of its lending transactions from within the
area surrounding its branch offices, as well as from within the Baltimore
metropolitan area.
Capital Resources
On August 7, 1997, the Company commenced an initial public offering (the
"Offering") of a maximum of 300,000 shares of its common stock, $0.01 par value
per share (the "Common Stock"), pursuant to the Company's Registration Statement
on Form SB-1 (No. 333-28881), primarily for the purpose of raising the funds
necessary to capitalize the Bank. The Offering was terminated by the Company on
November 30, 1997 when the Company sold the maximum number of shares available
in the Offering. The Company received gross Offering proceeds of $3,000,000, and
incurred Offering expenses of $150,000, resulting in net Offering proceeds of
$2,850,000. Effective as of December 1, 1997, the Company purchased $2,150,000
of the capital stock of the Bank, and the Bank became a wholly owned subsidiary
of the Company.
Management believes that the Company must raise approximately $1,100,000
of additional capital in connection with the opening of a Towson Branch.
Management also believes that the Company must raise approximately $3,300,000
(inclusive of the $1,100,000) of additional capital in connection with the
Conversion. Furthermore, if an opportunity to open other branches arises,
whether through internal growth or through an acquisition, and it is determined
that additional funds are required to finance the transaction, the Company will
seek to raise additional funds. Any equity or debt financings, if available at
all, may be on terms which are not favorable to the Company or the Bank and, in
the case of equity financings, could result in dilution to the Company's
stockholders. If adequate capital is not available, the Bank may be required to
curtail significantly its expected operations and its expansion strategy.
The Bank currently maintains a liquidity ratio and a level of
capitalization in excess of the minimum standards required by the Bank's primary
regulator, the OTS.
10
<PAGE>
As of March 24, 1998, the Company's Common Stock became eligible to be
quoted on the OTC Bulletin Board and reported in the "pink sheets" under the
symbol AMBB.
Summary of Financial Condition and Results of Operations
The Bank commenced operations as of December 1, 1997, and its activities
have primarily consisted of accepting deposits, making loans and servicing the
deposits and loans acquired from Rushmore.
At June 30, 1998, the Company had total assets of approximately
$11,385,000, total loans of approximately $6,562,000 and total deposits of
approximately $8,392,000. From December 31, 1997 to June 30, 1998, the Company's
loans increased from approximately $6,251,000 to $6,562,000, and its deposits
decreased from approximately $8,396,000 to $8,392,000. The Company experienced a
loss of approximately $92,000 for the six months ended June 30, 1998.
Net interest income for the second quarter of 1998 was approximately
$104,000, an increase of approximately $11,000 from the first quarter of 1998.
Net interest income for the six months ended June 30, 1998 was $197,000. Net
interest income, which is the difference between the interest expense incurred
in connection with the Company and the Bank's interest-bearing liabilities, such
as interest on deposit accounts, and the interest income received from
interest-earning assets, such as loans and investment securities, is the most
significant component of the Company's earnings. Volatility in interest rates
could cause the Bank to pay increased interest rates to obtain deposits and, if
the Bank is not able to increase the interest rate on its loans and the rate of
return on its investment portfolio, net interest income will suffer.
In April 1998, the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants issued Statement of Position
98-5 (the "SOP") regarding financial reporting on the costs of start-up
activities. Under the SOP, organizational costs are considered start-up costs
and, commencing with fiscal years beginning after December 15, 1998, entities
are required to expense such costs as they are incurred. As a result of the SOP,
the Company will be required to write off its unamortized organizational costs
during the first quarter of 1999, as a cumulative change in an accounting
principal. It is anticipated that an aggregate of approximately $115,000 will be
written off by the Company and the Bank during the first quarter of 1999, which
will negatively affect the Company's consolidated results of operations for that
period.
11
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Year 2000 Compliance
The much publicized Year 2000 Issue is the result of computer programs
being written using two digits rather than four to define an applicable year.
Computer programs with date-sensitive software may recognize a date using "00"
as the year 1900 rather than the year 2000. With respect to software used for
bank operations, mistakes of this nature could cause disruptions of operations,
including, among other things, the temporary inability to process transactions
or engage in similar normal business activities. In addition, the Year 2000
Issue increases transaction risk with third parties, including customers.
The Bank contracts with an outside firm to provide data processing
services. The Bank's contract with this firm is schedule to expire on December
1, 2000. The data processing firm has advised the Bank in writing that it
intends for its software to be Year 2000 compliant by December 31, 1998;
therefore, the data processing firm's software would not be impacted by any
date-sensitive calculations related to the Year 2000 Issue. The Bank does not
anticipate incurring any extra costs from the data processing firm in connection
with the Year 2000 Issue. The data processing firm provides the Bank with
periodic updates on its progress with regard to the Year 2000 Issue. The Bank
does not believe that its business will be materially impacted by the Year 2000
Issue, assuming that the data processing firm fulfills its representation to the
Bank that its software will be Year 2000 compliant by December 31, 1998.
However, there can be no assurance that the Bank's data processing system will
be Year 2000 compliant, and such failure may have a material adverse affect on
the Company's earnings, cash flows and overall financial condition.
In addition, in accordance with OTS requirements, the Bank has appointed a
Year 2000 Committee and has adopted a written plan detailing the procedures to
be followed by management to identify and solve potential problems and to
monitor the progress made by the Bank and the data processing firm to avoid Year
2000 problems. The OTS recently evaluated the Bank's Year 2000 plan and, of the
two ratings available - "needs improvement" and "satisfactory," gave the Bank a
"satisfactory" rating.
IN ADDITION TO THE HISTORICAL INFORMATION CONTAINED IN PART I OF THIS
QUARTERLY REPORT ON FORM 10-QSB, THE DISCUSSION IN PART I OF THIS QUARTERLY
REPORT ON FORM 10-QSB CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS SUCH AS
STATEMENTS OF THE COMPANY'S PLANS, OBJECTIVES, EXPECTATIONS AND INTENTIONS THAT
INVOLVE RISKS AND UNCERTAINTIES. THESE RISKS AND UNCERTAINTIES INCLUDE, AMONG
OTHERS, THE COMPANY'S LACK OF OPERATING HISTORY AND HISTORY OF LOSSES; ABILITY
TO OPEN A
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TOWSON BRANCH; DELAY OR DENIAL OF CONVERSION; RISKS RELATED TO COMMERCIAL,
CONSTRUCTION AND CONSUMER LENDING; RISKS RELATED TO NEW MANAGEMENT; IMPACT OF
INTEREST RATE VOLATILITY ON DEPOSITS; INTEREST RATE, LENDING AND OTHER RISKS
ASSOCIATED WITH THE LOANS ACQUIRED FROM RUSHMORE; RISK OF LOAN LOSSES; RISK OF
BRANCH EXPANSION STRATEGY; DEPENDENCE ON OFFICERS OF BANK AND KEY PERSONNEL;
IMPACT OF GOVERNMENT REGULATION ON OPERATING RESULTS; RISKS OF COMPETITIVE
MARKET; IMPACT OF MONETARY POLICY AND OTHER ECONOMIC FACTORS ON OPERATING
RESULTS; DIVIDEND RESTRICTIONS; UNCERTAINTY AS TO EFFECTS OF PROPOSED FEDERAL
LEGISLATION; DEVELOPMENTS IN TECHNOLOGY; YEAR 2000 ISSUES; CONTROL BY
MANAGEMENT; AND WRITE-OFF OF CAPITALIZED AMOUNTS. THE COMPANY'S ACTUAL RESULTS
COULD DIFFER MATERIALLY FROM THOSE DISCUSSED HEREIN.
13
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities and Use of Proceeds.
Not applicable.
Item 3. Defaults Upon Senior Securities.
Not applicable.
Item 4. Submission of Matters to a Vote of Securities Holders.
On May 28, 1998, AmericasBank Corp. (the "Company") held its Annual
Meeting of Stockholders. At the meeting, the following persons were elected to
the Board of Directors to hold office until the annual meeting held in the year
indicated opposite each of such director's name, and until his or her successor
has been elected and qualified. The votes cast and withheld for each such
director was as follows:
<TABLE>
<CAPTION>
Name Term to Expire For Withheld
- ---- -------------- --- --------
<S><C>
Garbis Baklayan 2000 208,003 250
Nicholas J. Belitsos, M.D. 2000 208,003 250
King V. Cheek 2001 208,003 250
Cynthia B. Conklin 2000 208,003 250
William A. Fogle, Jr. 2001 208,003 250
Constantine Frank 1999 208,003 250
Leonard Frenkil 1999 208,003 250
J. Clarence Jameson, III 2001 208,003 250
Kemp Jayadeva 2001 208,003 250
Norman H. Katz 2001 208,003 250
Shawki N. Malek, M.D. 2001 208,003 250
Michael Mekalian 1999 208,003 250
Mark D. Noar, M.D. 1999 208,003 250
Larry D. Ohler 2001 208,003 250
Kenneth D. Pezzulla 2001 208,003 250
George E. Rayme, Jr. 1999 208,003 250
Ramon F. Roig, Jr., M.D. 2000 208,003 250
Russell A. Rourke 2000 208,003 250
Melanie R. Sabelhaus 2000 208,003 250
Baldev Singh 2000 208,003 250
Michael Stern 1999 208,003 250
</TABLE>
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In addition, the Company's stockholders approved the following proposals:
Ratification of the appointment of Arthur Andersen LLP as independent
auditors of the Company for the fiscal year ended December 31, 1998, as
follows:
FOR - 207,003 AGAINST - 0 ABSTAIN - 0 BROKER N0N-VOTES - 0
Approval of the Company's Stock Option Plan, as follows:
FOR - 182,803 AGAINST -12,000 ABSTAIN - 0 BROKER N0N-VOTES - 0
Item 5. Other Information.
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
The following exhibits are being filed herewith:
EXHIBIT 3 Amended and Restated Bylaws
EXHIBIT 10 AmericasBank Corp. Stock Option Plan
EXHIBIT 27 Financial Data Schedules
(b) Reports on Form 8-K.
None.
15
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of
1934, as amended, the registrant caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
AMERICASBANK CORP.
Date: August 14, 1998 By: /s/ J. Clarence Jameson, III
-------------------------------
J. Clarence Jameson, III,
President and Chairman of the
Board of Directors
(Principal Executive Officer)
Date: August 14, 1998 By: /s/ Larry D. Ohler
-------------------------------
Larry D. Ohler, Treasurer
(Principal Financial and
Accounting Officer)
16
EXHIBIT 3
AMERICASBANK CORP.
AMENDED AND RESTATED BYLAWS
ARTICLE I
Stockholders
SECTION 1. Annual Meeting. The annual meeting of the stockholders of
AmericasBank Corp. (the "Corporation") shall be held on a day duly designated by
the Board of Directors in May of each year, for the purpose of electing
Directors to succeed those whose terms shall have expired as of the date of such
annual meeting, and for the transaction of such other corporate business as may
come before the meeting.
SECTION 2. Special Meeting. Special meetings of the stockholders may be
called at any time for any purpose or purposes by the Chairman of the Board, the
President, by a Vice President, or by eighty percent (80%) of the members of the
Board of Directors, and shall be called forthwith by the Chairman of the Board,
the President, by a Vice President, the Secretary or any Director of the
Corporation upon the request in writing of the holders of twenty-five percent
(25%) of all the shares outstanding and entitled to vote on the business to be
transacted at such meeting. Such request shall state the purpose or purposes of
the meeting. Business transacted at all special meetings of stockholders shall
be confined to the purpose or purposes stated in the notice of the meeting.
SECTION 3. Place of Holding Meetings. All meetings of stockholders
shall be held at the principal office of the Corporation or elsewhere
in the United States as designated by the Board of Directors.
SECTION 4. Notice of Meetings. Written notice of each meeting of the
stockholders shall be mailed, postage prepaid by the Secretary, to each
stockholder of record entitled to vote thereat at his post office address, as it
appears upon the books of the Corporation, at least ten (10) days before the
meeting. Each such notice shall state the place, day, and hour at which the
meeting is to be held and, in the case of any special meeting, shall state
briefly the purpose or purposes thereof.
SECTION 5. Quorum. The presence in person or by proxy of the holders of
record of a majority of the shares of the capital stock of the Corporation
issued and outstanding and entitled to vote thereat shall constitute a quorum at
all meetings of the stockholders, except as otherwise provided by law, by the
Charter or by these By-Laws. If less than a quorum shall be in attendance at the
time for which the
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meeting shall have been called, the meeting may be adjourned from time to time
by a majority vote of the stockholders present or represented, without any
notice other than by announcement at the meeting, until a quorum shall attend.
At any adjourned meeting at which a quorum shall attend, any business may be
transacted which might have been transacted if the meeting had been held as
originally called.
SECTION 6. Conduct of Meetings. Meetings of stockholders shall be presided
over by the Chairman of the Corporation or, if he is not present, by the
President, or, if none of said officers is present, by a chairman to be elected
at the meeting. The Secretary of the Corporation, or if he is not present, any
Assistant Secretary shall act as secretary of such meetings; in the absence of
the Secretary and any Assistant Secretary, the presiding officer may appoint a
person to act as Secretary of the meeting.
SECTION 7. Voting. At all meetings of stockholders, every stockholder
entitled to vote thereat shall have one (1) vote for each share of stock
standing in his name on the books of the Corporation on the date for the
determination of stockholders entitled to vote at such meeting. Such vote may be
either in person or by proxy appointed by an instrument in writing subscribed by
such stockholder or his duly authorized attorney, bearing a date not more than
three (3) months prior to said meeting, unless said instrument provides for a
longer period. Such proxy shall be dated, but need not be sealed, witnessed or
acknowledged. All elections shall be had and all questions shall be decided by a
majority of the votes cast at a duly constituted meeting, except as otherwise
provided by law, by the Charter or by these By-Laws.
If the chairman of the meeting shall so determine, a vote by ballot may be
taken upon any election or matter, and the vote shall be so taken upon the
request of the holders of ten percent (10%) of the stock entitled to vote on
such election or matter. In either of such events, the proxies and ballots shall
be received and be taken in charge and all questions touching the qualification
of voters and the validity of proxies and the acceptance or rejection of votes,
shall be decided by the tellers. Such tellers shall be appointed by the chairman
of said meeting.
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ARTICLE II
Board of Directors
SECTION 1. General Powers. The property and business of the Corporation
shall be managed under the direction of the Board of Directors of the
Corporation.
SECTION 2. Number and Term of Office. The number of Directors of the
Corporation shall be nine (9), which number may be increased or decreased by the
Board of Directors pursuant to a resolution adopted by majority of the members
of the entire Board of Directors. The stockholders shall not be entitled to fix
the number of members of the Board of Directors.
At the first annual meeting of the stockholders, the Directors shall be
divided into three classes, Class A, Class B and Class C, the number of
directors in each class to be as nearly equal in number as possible. Each
Director shall serve for a term ending on the date of the third annual meeting
following the annual meeting at which such Director was elected; provided,
however, that the Class A Directors first chosen shall hold office for one year
or until the first annual meeting following their election, the Class B
Directors first chosen shall hold office for two years or until the second
annual meeting following their election, and the Class C Directors first chosen
shall hold office for three years or until the third annual meeting following
their election. The Directors shall be elected each year at the annual meeting
of stockholders, except as provided above, and each Director shall serve until
his successor shall be elected and shall qualify.
SECTION 3. Filling of Vacancies. Newly created directorships resulting from
any increase in the number of Directors or any vacancies in the Board of
Directors resulting from death, resignation, retirement, disqualification,
removal from office or other cause shall be filled by a majority vote of the
remaining Directors, and the Directors so chosen shall hold office for a term
expiring at the next annual meeting of stockholders at which successors shall be
elected and shall qualify. Newly created directorships resulting from an
increase in the number of Directors shall be apportioned by the Board of
Directors among the three (3) classes so as to maintain the number of Directors
in each class as nearly equal in number as possible.
SECTION 4. Removal of Directors. At any meeting of stockholders,
duly called and at which a quorum is present, the stockholders may, by
the affirmative vote of a majority of all the votes entitled to be
cast for the election of directors, remove any Director from office,
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but only for cause. The stockholders may elect a successor to fill any
resulting vacancy for the balance of the term of the removed Director.
SECTION 5. Place of Meeting. The Board of Directors may hold their meetings
and have one or more offices, and keep the books of the Corporation, either
within or outside the State of Maryland, at such place or places as they may
from time to time determine. The Board of Directors may hold their meetings by
conference telephone or other similar electronic communications equipment in
accordance with the provisions of the Maryland General Corporation law.
SECTION 6. Regular Meetings. Regular meetings of the Board of Directors may
be held without notice at such time and place as shall from time to time be
determined by resolution of the Board, provided that notice of every resolution
of the Board fixing or changing the time or place for the holding of regular
meetings of the Board shall be mailed to each Director at least three (3) days
before the first meeting held pursuant thereto. The annual meeting of the Board
of Directors shall be held immediately following the annual stockholders'
meeting at which members of a Class of Directors are elected. Any business may
be transacted at any regular meeting of the Board.
SECTION 7. Special Meetings. Special meetings of the Board of Directors shall
be held whenever called by direction of the Chairman of the Board or the
President and must be called by the Chairman of the Board, the President or the
Secretary upon written request of eighty percent (80%) of the members of the
Board of Directors. The Secretary shall give notice of each special meeting of
the Board of Directors, by mailing the same at least three (3) days prior to the
meeting or by telegraphing the same at least two (2) days before the meeting, to
each Director; but such notice may be waived by any Director. Unless otherwise
indicated in the notice thereof, any and all business may be transacted at any
special meeting. At any meeting at which every Director shall be present, even
though without notice, any business may be transacted and any Director may in
writing waive notice of the time, place and objectives of any special meeting.
SECTION 8. Quorum. A majority of the entire number of Directors shall
constitute a quorum for the transaction of business at all meetings of the Board
of Directors, but, if at any meeting less than a quorum shall be present, a
majority of those present may adjourn the meeting from time to time, and the act
of a majority of the Directors present at any meeting at which there is a quorum
shall be the act of the Board of Directors, except as may be otherwise
specifically provided by law or by the Charter or by these By-Laws.
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SECTION 9. Action by Directors. Any action required or permitted to be taken
at a meeting of the Board of Directors may be taken without a meeting, if an
unanimous written consent which sets forth the action is signed by each member
of the Board and filed with the minutes of proceedings of the Board.
SECTION 10. Compensation of Directors. Directors shall not receive any stated
salary for their services as such, but each Director shall be entitled to
receive from the Corporation reimbursement of the expenses incurred by him in
attending any regular or special meeting of the Board, and, by resolution of the
Board of Directors, a fixed sum may also be allowed for attendance at each
regular or special meeting of the Board and such reimbursement and compensation
shall be payable whether or not a meeting is adjourned because of the absence of
a quorum. Nothing herein contained shall be construed to preclude any Director
from serving the Corporation in any other capacity and receiving compensation
therefor.
SECTION 11. Committees. The Board of Directors may, by resolution passed by a
majority of the entire Board, designate an executive and one or more other
committees, each committee to consist of two or more of the Directors of the
Corporation, which, to the extent provided in the resolution and as permitted by
law, shall have and may exercise the powers of the Board of Directors, and may
authorize the seal of the Corporation to be affixed to all papers which may
require it. Such committee or committees shall have such names as may be
determined from time to time by resolution adopted by the Board of Directors.
ARTICLE III
Officers
SECTION 1. Election, Tenure and Compensation. The officers of the Corporation
shall be a President, an Executive Vice President, a Secretary, and a Treasurer,
and also such other officers including a Chairman of the Board, a Vice Chairman
of the Board and/or additional Vice Presidents and/or one or more assistants to
the foregoing officers as the Board of Directors from time to time may consider
necessary for the proper conduct of the business of the Corporation. The
officers shall be elected by the Board of Directors at its first meeting and
thereafter annually following the annual meeting of the stockholders except
where a longer term is expressly provided in an employment contract duly
authorized and approved by the Board of Directors. The President, Chairman of
the Board and Vice Chairman of the Board shall be Directors and the other
officers may, but need not be, Directors. Any two or more of the above offices,
except those of
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President and Vice President, and Chairman of the Board and Vice Chairman of the
Board, may be held by the same person, but no officer shall execute, acknowledge
or verify any instrument in more than one capacity if such instrument is
required by law or by these By-Laws to be executed, acknowledged or verified by
any two or more officers. The compensation or salary paid all officers of the
Corporation shall be fixed by resolutions adopted by the Board of Directors.
In the event that any office other than an office required by law shall not
be filled by the Board of Directors, or, once filled, subsequently becomes
vacant, then such office and all references thereto in these By-Laws shall be
deemed inoperative unless and until such office is filled in accordance with the
provisions of these By-Laws.
Except where otherwise expressly provided in a contract duly authorized by
the Board of Directors, all officers, agents and employees of the Corporation
shall be subject to removal at any time by the affirmative vote of a majority of
the entire Board of Directors, and all officers, agents, and employees shall
hold office at the discretion of the Board of Directors or of the officers
appointing them.
SECTION 2. Powers and Duties of the Chairman of the Board and Vice Chairman
of the Board. The Chairman of the Board shall preside at all meetings of the
Board of Directors unless the Board of Directors shall by a majority vote of a
quorum thereof elect a chairman other than the Chairman of the Board to preside
at meetings of the Board of Directors. He may sign and execute all authorized
bonds, contracts or other obligations in the name of the Corporation; and he
shall be ex-officio a member of all standing committees.
The Vice Chairman of the Board shall (except as otherwise provided by
resolution of the Board of Directors) have the power to perform all duties of
the Chairman of the Board in the absence or disability of the Chairman of the
Board and shall have such other powers and perform such other duties as may be
assigned to him by the Board of Directors.
SECTION 3. Powers and Duties of the President. The President shall be the
chief executive officer of the Corporation and shall
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have general charge and control of all its business affairs and properties.
The President may sign and execute all authorized bonds, contracts or other
obligations in the name of the Corporation. He shall have the general powers and
duties of supervision and management usually vested in the office of chief
executive officer of a corporation. The President shall be ex-officio a member
of all standing committees. He shall do and perform such other duties as may,
from time to time, be assigned to him by the Board of Directors.
In the event that the Board of Directors does not take affirmative action to
fill the office of Chairman of the Board or Vice Chairman of the Board, the
President shall assume and perform all powers and duties given to the Chairman
of the Board by these By-Laws.
SECTION 4. Powers and Duties of the Executive Vice President. The Board of
Directors shall appoint an Executive Vice President and may appoint more than
one other Vice President. The Executive Vice President shall be the chief
operating officer of the Corporation and he shall have the general powers and
duties of supervision and management usually vested in the office of chief
operating officer of a corporation. Any Vice President (unless otherwise
provided by resolution of the Board of Directors) may sign and execute all
authorized bonds, contracts, or other obligations in the name of the
Corporation. Each Vice President shall have such other powers and shall perform
such other duties as may be assigned to him by the Board of Directors or by the
President. In case of the absence or disability of the President, the duties of
that office shall be performed by the Executive Vice President, and the taking
of any action by the Executive Vice President in place of the President shall be
conclusive evidence of the absence or disability of the President.
SECTION 5. Secretary. The Secretary shall give, or cause to be given, notice
of all meetings of stockholders and Directors and all other notices required by
law or by these By-Laws, and in case of his absence or refusal or neglect to do
so, any such notice may be given by any person thereunto directed by the
President, or by the Directors or stockholders upon whose written request the
meeting is called as provided in these By-Laws. The Secretary shall record all
the proceedings of the meetings of the stockholders and of the Directors in
books provided for that purpose, and he shall perform such other duties as may
be assigned to him by the Directors or the President.
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He shall have custody of the seal of the Corporation and shall affix the same to
all instruments requiring it, when authorized by the Board of Directors or the
President, and attest to the same. In general, the Secretary shall perform all
the duties generally incident to the office of Secretary, subject to the control
of the Board of Directors and the President.
SECTION 6. Treasurer. The Treasurer shall have custody of all the funds and
securities of the Corporation, and he shall keep full and accurate account of
receipts and disbursements in books belonging to the Corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
Corporation in such depository or depositories as may be designated by the Board
of Directors.
The Treasurer shall disburse the funds of the Corporation as may be ordered
by the Board of Directors, taking proper vouchers for such disbursements. He
shall render to the President and the Board of Directors, whenever either of
them so requests, an account of all his transactions as Treasurer and of the
financial condition of the Corporation.
The Treasurer shall give the Corporation a bond, if required by the Board of
Directors, in a sum, and with one or more sureties, satisfactory to the Board of
Directors, for the faithful performance of the duties of his office and for the
restoration to the Corporation in case of his death, resignation, retirement or
removal from office of all books, papers, vouchers, moneys, and other properties
of whatever kind in his possession or under his control belonging to the
Corporation.
The Treasurer shall perform all the duties generally incident to the office
of the Treasurer, subject to the control of the Board of Directors and the
President.
SECTION 7. Assistant Secretary. The Board of Directors may appoint an
Assistant Secretary or more than one Assistant Secretary. Each Assistant
Secretary shall (except as otherwise provided by resolution of the Board of
Directors) have power to perform all duties of the Secretary in the absence or
disability of the Secretary and shall have such other powers and shall perform
such other duties as may be assigned to him by the Board of Directors or the
President. In case of the absence or disability of the Secretary, the duties of
the office shall be performed by any Assistant Secretary, and the taking of any
action by any such Assistant Secretary in place of the Secretary shall be
conclusive evidence of the absence or disability of the Secretary.
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SECTION 8. Assistant Treasurer. The Board of Directors may appoint an
Assistant Treasurer or more than one Assistant Treasurer. Each Assistant
Treasurer shall (except as otherwise provided by resolution of the Board of
Directors) have power to perform all duties of the Treasurer in the absence or
disability of the Treasurer and shall have such other powers and shall perform
such other duties as may be assigned to him by the Board of Directors or the
President. In case of the absence or disability of the Treasurer, the duties of
the office shall be performed by any Assistant Treasurer, and the taking of any
action by any such Assistant Treasurer in place of the Treasurer shall be
conclusive evidence of the absence or disability of the Treasurer.
ARTICLE IV
Capital Stock
SECTION 1. Issuance of Certificates of Stock. The certificates for shares of
the stock of the Corporation shall be of such form not inconsistent with the
Charter, as shall be approved by the Board of Directors. All certificates shall
be signed by the Chairman and President or by the Executive Vice President and
countersigned by the Secretary or by an Assistant Secretary. All certificates
for each class of stock shall be consecutively numbered. The name of the person
owning the shares issued and the address of the holder, shall be entered in the
Corporation's books. All certificates surrendered to the Corporation for
transfer shall be cancelled and no new certificates representing the same number
of shares shall be issued until the former certificate or certificates for the
same number of shares shall have been so surrendered, and cancelled, unless a
certificate of stock be lost or destroyed, in which event another may be issued
in its stead upon proof of such loss or destruction and unless waived by the
President, the giving of a satisfactory bond of indemnity not exceeding an
amount double the value of the stock. Both such proof and such bond shall be in
a form approved by the general counsel of the Corporation.
SECTION 2. Transfer of Shares. Shares of the capital stock of the Corporation
shall be transferred on the books of the Corporation only by the holder thereof
in person or by his attorney upon surrender and cancellation of certificates for
a like number of shares as hereinabove provided.
SECTION 3. Registered Stockholders. The Corporation shall be entitled to
treat the holder of record of any share or shares of stock as the holder in fact
thereof and accordingly shall not be bound to recognize any equitable or other
claim to or interest in such share in
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the name of any other person, whether or not it shall have express or other
notice thereof, save as expressly provided by the laws of the State of Maryland.
SECTION 4. Closing Transfer Books/Fixing of Record Date. The Board of
Directors may fix the time, not exceeding twenty (20) days preceding the date of
any meeting of stockholders or any dividend payment date or any date for the
allotment of rights, during which time the books of the Corporation shall be
closed against transfer of stock, or, in lieu thereof, the Directors may fix a
date not exceeding ninety (90) days preceding the date of any meeting of
stockholders or any dividend payment date or any date for the allotment of
rights, as a record date for the determination of the stockholders entitled to
notice of and to vote at such meeting or to receive such dividends or rights as
the case may be; and only stockholders of record on such date shall be entitled
to notice of and to vote at such meeting or to receive such dividends or rights
as the case may be.
ARTICLE V
Corporate Seal
SECTION 1. Seal. In the event that the President shall direct the Secretary
to obtain a corporate seal, the corporate seal shall be circular in form and
shall have inscribed thereon the name of the Corporation, the year of its
organization and the word "Maryland". Duplicate copies of the corporate seal may
be provided for use in the different offices of the Corporation but each copy
thereof shall be in the custody of the Secretary of the Corporation or of an
Assistant Secretary of the Corporation nominated by the Secretary.
ARTICLE VI
Bank Accounts and Loans
SECTION 1. Bank Accounts. Such officers or agents of the Corporation as from
time to time shall be designated by the Board of Directors shall have authority
to deposit any funds of the Corporation in such banks or trust companies as
shall from time to time be designated by the Board of Directors and such
officers or agents as from time to time shall be authorized by the Board of
Directors may withdraw any or all of the funds of the Corporation so deposited
in any such bank or trust company, upon checks, drafts or other instruments or
orders for the payment of money drawn against the account or in the name or
behalf of this Corporation, and made or signed by such officers or agents; and
each bank or trust company with which funds of the Corporation are so deposited
is authorized to
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accept, honor, cash and pay, without limit as to amount, all checks, drafts or
other instruments or orders for the payment of money, when drawn, made or signed
by officers or agents so designated by the Board of Directors until written
notice of the revocation of the authority of such officers or agents by the
Board of Directors shall have been received by such bank or trust company. There
shall from time to time be certified to the banks or trust companies in which
funds of the Corporation are deposited, the signature of the officers or agents
of the Corporation so authorized to drawn against the same. In the event that
the Board of Directors shall fail to designate the persons by whom checks,
drafts and other instruments or orders for the payment of money shall be signed,
as hereinabove provided in this Section, all of such checks, drafts and other
instruments or orders for the payment of money shall be signed by the President
or a Vice President and countersigned by the Secretary or Treasurer or an
Assistant Secretary or an Assistant Treasurer of the Corporation.
SECTION 2. Loans. Such officers or agents of this Corporation as from time to
time shall be designated by the Board of Directors shall have authority to
effect loans, advances or other forms of credit at any time or times for the
Corporation from such banks, trust companies, institutions, corporations, firms
or persons as the Board of Directors shall from time to time designate, and as
security for the repayment of such loans, advances, or other forms of credit to
assign, transfer, endorse and deliver, either originally or in addition or
substitution, any or all stocks, bonds, rights and interests of any kind in or
to stocks or bonds, certificates of such rights or interests, deposits,
accounts, documents covering merchandise, bills and accounts receivable and
other commercial paper and evidences of debt at any time held by the
Corporation; and for such loans, advances or other forms of credit to make,
execute and deliver one or more notes, acceptances or written obligations of the
Corporation on such terms, and with such provisions as to the security or sale
or disposition thereof as such officers or agents shall deem proper; and also to
sell to, or discount or rediscount with, such banks, trust companies,
institutions, corporations, firms or persons any and all commercial paper, bills
receivable, acceptances and other instruments and evidences of debt at any time
held by the Corporation, and to that end to endorse, transfer and deliver the
same. There shall from time to time be certified to each bank, trust company,
institution, corporation, firm or person so designated the signatures of the
officers or agents so authorized; and each such bank, trust company,
institution, corporation, firm or person is authorized to rely upon such
certification until written notice of the revocation by the Board of Directors
of the authority of such officers or agents shall be delivered to such bank,
trust company, institution, corporation, firm or person.
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ARTICLE VII
Reimbursements
Any payments made to an officer or other employee of the Corporation, such as
salary, commission, interest or rent, which shall be disallowed in whole or in
part as a deductible expense by the Internal Revenue Service, shall be
reimbursed by such officer or other employee of the Corporation to the full
extent of such disallowance. It shall be the duty of the Directors, as a Board,
to enforce payment of each such amount disallowed. In lieu of payment by the
officer or other employees subject to the determination of the Directors,
proportionate amounts may be withheld from his future compensation payments
until the amount owed to the Corporation has been recovered.
ARTICLE VIII
Indemnification
As used in this Article VIII, any word or words that are defined in Section
2-418 of the Maryland General Corporation Law, as amended from time to time (the
"Indemnification Section"), shall have the same meaning as provided in the
Indemnification Section.
The Corporation shall indemnify and advance expenses to a director or officer
of the Corporation in connection with a proceeding to the fullest extent
permitted by and in accordance with the Indemnification Section.
With respect to an employee or agent, other than a director or officer of the
Corporation, the Corporation may, as determined by the Board of Directors of the
Corporation, indemnify and advance expenses to such employee or agent in
connection with a proceeding to the fullest extent permitted by and in
accordance with the Indemnification Section.
ARTICLE IX
Miscellaneous Provisions
SECTION 1. Fiscal Year. The fiscal year of the Corporation shall
end on the date determined by the Board of Directors.
SECTION 2. Notices. Except as otherwise provided in these By-Laws,
whenever under the provisions of these By-Laws notice is required to
be given to any Director, officer or stockholder, it shall not be
construed to mean personal notice, but such notice shall be given in
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writing, by mail, by depositing the same in a post office or letter box in a
postpaid sealed wrapper addressed to each stockholder, officer or Director at
such address as appears on the books of the Corporation, or in default of any
other address, to such Director, officer or stockholder, at the general post
office in the City of Baltimore, Maryland, and such notice shall be deemed to be
given at the time the same shall be thus mailed. Any Director, officer or
stockholder may waive any notice required to be given under these By-laws.
ARTICLE X
Amendments
The Board of Directors shall have the exclusive power and authority to amend,
alter or repeal these By-Laws or any provision thereof, and may from time to
time make additional By-Laws; by resolution adopted by a majority of all of the
Directors, at any regular or special meeting of the Board.
The stockholders shall have no power or authority to amend, alter or repeal
these By-Laws or any provision thereof, or to make additional By-Laws.
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EXHIBIT 10
AMERICASBANK CORP.
STOCK OPTION PLAN
AmericasBank Corp. (the "Corporation") sets forth herein the terms of this
Stock Option Plan (the "Plan") as follows:
1. PURPOSE.
The Plan is intended to advance the interests of the Corporation by providing
eligible individuals (as designated pursuant to Section 4 below) with an
opportunity to acquire or increase a proprietary interest in the Corporation,
which thereby will create a stronger incentive to expend maximum effort for the
growth and success of the Corporation and its subsidiaries, and will encourage
such eligible individuals to remain in the employ of the Corporation or that of
one or more of its subsidiaries. Each stock option granted under the Plan (an
"Option") is intended to be an "incentive stock option" ("Incentive Stock
Option") within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended, or the corresponding provision of any subsequently enacted tax
statute (the "Code"), except (i) to the extent that any such Option would exceed
limitations set forth in Section 7 below; and (ii) for Options specifically
designated at the time of grant as not being Incentive Stock Options; and (iii)
for Options granted to non-employee directors of the Company or a subsidiary.
2. ADMINISTRATION.
(a) COMMITTEE. The Board of Directors of the Corporation (the "Board") shall
appoint a compensation committee (the "Committee") to the extent permitted by
the By-Laws of the Corporation and applicable law and such Committee shall be
composed solely of two or more Non-Employee Directors as such term is defined in
Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended, or
shall otherwise be constituted in accordance with Rules promulgated under
Section 16 of said Act from time to time. The Board may remove members, add
members, and fill vacancies on the Committee from time to time, all in
accordance with the Corporation's Articles of Incorporation and By-Laws, and
with applicable law. The majority vote of the Committee, or acts reduced to or
approval in writing by a majority of the members of the Committee, shall be
valid acts of the Committee.
(b) ADMINISTRATION. The Plan shall be administered by the Committee which
shall have full power and authority to take all actions, and to make all
determinations required or provided for under the Plan or any
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Option granted or Option Agreement (as defined in Section 8 below) entered into
hereunder and all such actions and determinations not inconsistent with the
specific terms and provisions of the Plan deemed by the Committee to be
necessary or appropriate to the administration of the Plan or any Option granted
or Option Agreement entered into hereunder. Unless otherwise expressly
determined or overruled by the Board, the interpretation and construction by the
Committee of any provision of the Plan or of any Option granted or Option
Agreement entered into hereunder shall be final and conclusive. The Committee
may make different determinations for different Plan participants regarding the
Plan, Options or Option Agreement. The Committee shall cause a copy of this Plan
to be delivered to each participant in the Plan.
(c) NO LIABILITY. No member of the Board or of the Committee shall be liable
for any action or determination made in good faith with respect to the Plan or
any Option granted or Option Agreement entered into hereunder.
(d) DELEGATION TO THE COMMITTEE. In the event that the Plan or any Option
granted or Option Agreement entered into hereunder provides for any action to be
taken by or determination to be made by the Board, such action may be taken by
or such determination may be made by the Committee if the power and authority to
do so has been delegated to the Committee by the Board as provided for in
Section 2(a) above.
3. STOCK.
The stock that may be issued pursuant to Options granted under the Plan shall
be shares of Common Stock, par value $.01 per share, of the Corporation (the
"Stock"), which shares may be authorized but unissued shares or shares that may
be purchased by the Corporation in the open market or in private transactions.
The number of shares of Stock that may be issued pursuant to Options granted
under the Plan shall not exceed in the aggregate 45,000 shares, which number of
shares is subject to adjustment as hereinafter provided in Section 17 below. If
any Option expires, terminates, or is terminated or canceled for any reason
prior to exercise in full, the shares of Stock that were subject to the
unexercised portion of such Option shall be available for future Options granted
under the Plan. Shares withheld or surrendered for the payment of taxes or
shares surrendered in payment of the exercise price of an Option may not be
again available for awards under the Plan.
4. ELIGIBILITY.
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(a) EMPLOYEES. Options may be granted under the Plan to any full-time
employee of the Corporation or any Subsidiary (including any such employee who
is an officer or director of the Corporation or any Subsidiary) as the Committee
shall determine and designate from time to time prior to expiration or
termination of the Plan. For this purpose, a full-time employee is one who is
customarily employed at least 20 hours per week.
(b) NON-EMPLOYEE DIRECTORS OF THE CORPORATION. Each non-employee director of
the Corporation serving on the effective date of the Plan, as set forth in
Section 5 hereof, shall be granted an option on the effective date to purchase
20 shares of the Stock for each Board of Directors meeting and Capital Committee
meeting attended by such person from August 1, 1996 through and including the
effective date, and 20 shares of the Stock for each other Board committee
meeting attended by such person from January 1, 1998 through and including the
effective date. Thereafter, each non-employee director of the Corporation shall
be granted an option as of the date of his or her attendance at a meeting of the
Board of Directors of the Corporation or of a Board committee to purchase 20
shares of the Stock. Each Option granted to a non-employee directors shall be
granted at an Option Price equal to the greater of par value or 100 percent of
the fair market value of a share of Stock on the date of grant, which value
shall be determined as set forth in Section 9 hereof. The Board of Directors may
from time to time grant to an non-employee director such other options as the
Board of Directors shall determine to be reasonable, all of which options shall
be granted at an Option Price equal to the greater of par value or 100 percent
of the fair market value of a share of Stock on the date of grant, which value
shall be determined as set forth in Section 9 hereof.
5. EFFECTIVE DATE AND TERM OF THE PLAN.
(a) EFFECTIVE DATE. The Plan shall be effective as of June 1,1998 (the
"Effective Date"), subject to approval by the Board and the approval by holders
of a majority of the shares of the Stock voted. If the stockholders do not
approve the Plan within 12 months after the Board approves the Plan, then the
Plan and any grants of Options hereunder shall be void.
(b) TERM. The Plan shall terminate on the 10th anniversary of the Effective
Date.
6. GRANT OF OPTIONS.
Subject to the terms and conditions of the Plan, the Committee may, at any
time and from time to time, prior to the date of termination of the Plan, grant
to such eligible individuals as the Committee may
3
<PAGE>
determine ("Optionees"), Options to purchase such number of shares of the Stock
on such terms and conditions as the Committee may determine, including any terms
or conditions which may be necessary to qualify such Options as Incentive Stock
Options under Section 422 of the Code. The date on which the Committee approves
the grant of an Option shall be considered the date on which such Option is
granted
7. LIMITATION ON OPTIONS RECEIVED IN CALENDAR YEAR.
An Option (other than an Option described in exception (i) or (ii) or (iii)
of Section 1) shall constitute an Incentive Stock Option to the extent that the
aggregate fair market value (determined at the time the Option is granted) of
the Stock with respect to which Incentive Stock Options are exercisable for the
first time by an Optionee during any calendar year (under the Plan and all other
plans of the Optionee's employer corporation and its parent and subsidiary
corporations within the meaning of Section 422(d) of the Code) does not exceed
$100,000. This limitation shall be applied by taking Options into account in the
order in which they were granted.
8. OPTION AGREEMENTS.
All Options granted pursuant to the Plan shall be evidenced by written
agreements ("Option Agreements"), to be executed by the Corporation and by the
Optionee, in such form or forms as the Committee shall from time to time
determine. Option Agreements covering Options granted from time to time or at
the same time need not contain similar provisions; provided, however, that all
such Option Agreements shall comply with all terms of the Plan.
9. OPTION PRICE.
The purchase price of each share of the Stock subject to an Option (the
"Option Price") shall be fixed by the Committee and stated in each Option
Agreement; provided, however that the purchase price of any Option intended to
be an Incentive Stock Option shall be not less than the greater of par value or
100% of the fair market value of a share of the Stock on the date the Option is
granted; provided further, that in the event the Optionee would otherwise be
ineligible to receive an Incentive Stock Option by reason of the provisions of
Sections 422(b)(6) and 424(d) of the Code (relating to stock ownership of more
than 10%), the Option Price of an Option which is intended to be an Incentive
Stock Option shall be not less than the greater of par value or 110% of the fair
market value of a share of Stock at the time such Option is granted. In the
event that the Stock is listed on an established national or regional stock
exchange, is quoted on a quotation system of The Nasdaq Stock Market, Inc., or
is publicly
4
<PAGE>
traded in an established securities market, in determining the fair market value
of the Stock, the Committee shall use the closing price of the Stock on such
exchange or system or in such market (the highest such closing price if there is
more than one such exchange or market) on the date the Option is granted or, if
such date was not a trading date, on the trading date immediately preceding the
date the Option is granted (or, if there is no such closing price, then the
Committee shall use the mean between the highest bid and the lowest asked prices
or between the high and low prices on such date). If there is no established
market for the Stock, then the fair market value shall be established by the
Committee in good faith.
10. TERM AND EXERCISE OF OPTIONS.
(a) TERM. Each Option granted under the Plan shall terminate, and all rights
to purchase shares thereunder shall cease no later than the expiration of ten
years from the date such Option is granted. as may be fixed by the Committee and
stated in the Option Agreement relating to such Option; provided. however, that
in the event the Optionee would otherwise be ineligible to receive an Incentive
Stock Option by reason of the provisions of Sections 422(b)(6) and 424(d) of the
Code (relating to stock ownership of more than 10%), an Option granted to such
Optionee which is intended to be an Incentive Stock Option shall in no event be
exercisable after the expiration of five years from the date it is granted.
(b) OPTION PERIOD AND LIMITATIONS OR EXERCISE. Except as otherwise provided
in an Option Agreement. each Option granted may be exercised in whole or in part
at any time after the date of grant. Notwithstand ing the foregoing, the
Committee, subject to the terms and conditions of the Plan, may in its sole
discretion provide other time periods during which an Option may be exercised in
whole or in part while such Option is outstanding. Any limitation on the
exercise of an Option may be rescinded, modified or waived by the Committee, in
its sole discretion, at any time and from time to time after the date of grant
of such Option so as to accelerate the time at which the Option may be
exercised.
(c) METHOD OF EXERCISE. An Option that is exercisable hereunder may be
exercised by delivery to the Corporation on any business day, at its principal
office, addressed to the attention of the Committee, of written notice of
exercise, which notice shall specify the number of shares with respect to which
the Option is being exercised, accompanied by payment of the Option Price except
as provided in this Subsection (c). The minimum number of shares of Stock with
respect to which an Option may be exercised, in whole or in part, at any time
shall be the lesser of 100 shares or the maximum number of shares
5
<PAGE>
available for purchase under the Option at the time of exercise. Payment of the
Option Price for the shares of Stock purchased pursuant to the exercise of an
Option shall be made (i) in cash or in cash equivalents; (ii) through the tender
to the Corporation of shares of Stock, which shares shall be valued, for
purposes of determining the extent to which the Option Price has been paid
thereby, at their fair market value (determined in the manner described in
Section 9 above) on the date of exercise; (iii) through the tender to the
Corporation of Options, to the extent of the difference between the Option Price
and the fair market value of the shares of Stock subject to such Option
(determined in the manner described in Section 9 above) on the exercise date; or
(iv) by combination of the methods described in (i), (ii), and (iii) above.
Payment in full of the Option Price need not accompany the written notice of
exercise provided the notice of exercise directs that the Stock certificate or
certificates for the shares for which the Option is exercised be delivered to a
licensed broker applicable to the Corporation as the agent for the individual
exercising the Option and, at the time such Stock certificate or certificates
are delivered, the broker tenders to the Corporation cash (or cash equivalents
acceptable to the Corporation) equal to the Option Price for the shares of Stock
purchased pursuant to the exercise of the Option plus the amount (if any) of
federal and/or the taxes which the Corporation may, in its judgment, be required
to withhold with respect to the exercise of the Option. An attempt to exercise
any Option granted hereunder other than as set forth above shall be invalid and
of no force and effect. Promptly after the exercise of an Option and the payment
in full of the Option Price of the shares of Stock covered thereby, the
individual exercising the Option shall be entitled to the issuance of a Stock
certificate or certificates evidencing his ownership of such shares; provided,
however, that the Corporation shall have the right to withhold and deduct from
the number of shares of Stock deliverable upon exercise of an Option, a number
of shares having an aggregate fair market value (determined in the manner
described in Section 9 above) equal to the amount of any taxes and other charges
the Corporation or any Subsidiary is obligated to withhold or deduct from
amounts payable to such individual. A separate Stock certificate or certificates
shall be issued for any shares purchased pursuant to the exercise of an Option
which is an Incentive Stock Option, which certificate or certificates shall not
include any shares which were purchased pursuant to the exercise of an Option
which is not an Incentive Stock Option. An individual holding or exercising an
Option shall have none of the rights of a shareholder until the shares of Stock
covered thereby are fully paid and issued to him and, except as provided in
Section 17 below, no adjustment shall be made for dividends or other rights, if
any, for which the record date is prior to the date of such issuance.
6
<PAGE>
11. TRANSFERABILITY OF OPTIONS.
During the lifetime of an Optionee to whom an Option is granted, only such
Optionee (or, in the event of legal incapacity or incompetency, the Optionee's
guardian or legal representative) may exercise the Option. No Option shall be
assignable or transferable by the Optionee to whom it is granted, other than by
will or the laws of the descent and distribution.
12. TERMINATION OF SERVICE OR EMPLOYMENT.
Upon the termination of the employment of an Optionee with the Corporation or
a Subsidiary, any Option granted pursuant to the Plan shall terminate three
months after the date of such termination of employment, unless earlier
terminated pursuant to Section 10(a) above, and such Optionee shall have no
further right to purchase shares of Stock pursuant to such Option; provided
however, that if such termination is by reason of (i) the death or "permanent
and total disability" (within the meaning of Section 22(e)(3) of the Code) of
such Optionee, then termination of the Option shall be governed by Section 13
hereof, or (ii) the dismissal of such Optionee for dishonesty or commission of a
crime or for any reason constituting "cause" under the terms of an employment
agreement, if any, between the Optionee and the Corporation or a Subsidiary, or
for "cause" as otherwise determined by the Corporation in good faith, then the
Option shall terminate on the effective date of such dismissal. Notwithstanding
the foregoing, however, the Committee may provide, by inclusion of appropriate
language in an Option Agreement, that an Optionee may (subject to the general
limitations on exercise set forth in Section 10(b) above), in the event of
termination of employment of the Optionee with the Corporation or a Subsidiary,
exercise an Option, in whole or in part, at any time subsequent to such
termination of employment and prior to termination of the Option as provided in
Section 10(a) above either subject to or without regard to any installment
limitation or exercise imposed pursuant to Section 10(b) above. Whether a leave
of absence or leave on military or government services shall constitute a
termination of employment for purposes of the Plan shall be determined by the
Committee, which determination shall be final and conclusive. For purposes of
the Plan, a termination of employment with the Corporation or a Subsidiary shall
not be deemed to occur if immediately thereafter the Optionee is employed with
the Corporation or any Subsidiary.
Any option granted to a non-employee director shall terminate on the first
anniversary of the effective date of termination of such person's service on the
Board of Directors or such earlier time specified in an Option Agreement for
such option. Notwithstanding the
7
<PAGE>
foregoing, any option granted to a non-employee director shall terminate one
year following the date in which a non-employee director ceases to be a member
of the Board of Directors by reason of death or "permanent and total disability
"as defined in Section 13(b) hereof.
13. RIGHTS IN THE EVENT OF DEATH OR DISABILITY
(a) DEATH OF AN EMPLOYEE. If an Optionee dies while employed by the
Corporation or a Subsidiary, the executors or administrators or legatees or
distributees of such Optionee's estate shall have the right (subject to the
general limitations on exercise set forth in Section 10(b) above), at any time
within one year after the date of such Optionee's death and prior to termination
of the Option as provided in Section 10(a) above, to exercise, in whole or in
part, any Option held by such Optionee at the date of such Optionee's death,
whether or not such Option was exercisable immediately prior to such Optionee's
death; provided, however, that the Committee may provide, by inclusion of
appropriate language in an Option Agreement, that, in the event of the death of
the Optionee, the executors or administrators or legatees or distributees of
such Optionee's estate may exercise an Option (subject to the general
limitations on exercise set forth in Section 10(b) above), in whole or in part,
at any time subsequent to such Optionee's death and prior to termination of the
Option as provided in Section 10(a) above, either subject to or without regard
to any installment limitation on exercise imposed pursuant to Section 10(b)
above.
(b) DISABILITY OF AN EMPLOYEE. If an Optionee terminates employment with the
Corporation or a Subsidiary by reason of the "permanent and total disability"
(within the meaning of Section 22(e)(3) of the Code) of such Optionee, then such
Optionee shall have the right (subject to the general limitations on exercise
set forth in Section 10(b) above), at any time within one year after such
termination of employment and prior to termination of the Option as provided in
Section 10(a) above, to exercise, in whole or in part, any Option held by such
Optionee at the date of such termination of employment, whether or not such
Option was exercisable immediately prior to such termination of employment;
provided, however, that the Committee may provide, by inclusion of appropriate
language in the Option Agreement, that the Optionee may (subject to the general
limitations on exercise set forth in Section 10(b) above), in the event of the
termination of employment of the Optionee with the Corporation or a Subsidiary
by reason of the "permanent and total disability" (within the meaning of Section
22(e)(3) of the Code) of such Optionee, exercise an Option , in whole or in
part, at any time subsequent to such termination of employment and prior to
termination of the Option as provided in Section 10(a) above, either subject to
or without regard to any installment
8
<PAGE>
limitation on exercise imposed pursuant to Section 10(b) above. Whether a
termination of employment is to be considered by reason of "permanent and total
disability" for purposes of this Plan shall be determined by the Committee,
which determination shall be final and conclusive.
14. USE OF PROCEEDS.
The proceeds received by the Corporation from the sale of Stock pursuant to
Options granted under the Plan shall constitute general funds of the
Corporation.
15. REQUIREMENTS OF LAW.
(a) VIOLATIONS OF LAW. The Corporation shall not be required to sell or issue
any share of Stock under any Option if the sale or issuance of such shares would
constitute a violation by the individual exercising the Option or the
Corporation of any provision of any law or regulation of any governmental
authority, including without limitation any federal or state securities laws or
regulations. Specifically in connection with the Securities Act of 1933, as
amended, (as now in effect with respect to the shares covered by any Option),
unless a registration statement under such Act is in effect with respect to the
shares of Stock covered by such Option, the Corporation shall not be required to
sell or issue such shares unless the Corporation has received evidence
satisfactory to it that the holder of such Option may acquire such shares
pursuant to an exemption from registration under such Act, and the shares of
Stock to be issued upon the exercise of all or any portion of any Option granted
under the Plan shall be issued on the condition that the Optionee represents
that the purchase of Stock upon such exercise shall be for investment purposes
and not with a view to resale, distribution, offering, transferring, mortgaging,
pledging, hypothecating or otherwise disposing of any such Stock under the
circumstances which would constitute a public offering or distribution under the
Securities Act of 1933, as amended, or the securities laws of any state. No
share of Stock shall be issued upon the exercise of any Option unless the
Corporation shall have received from the Optionee a written statement
satisfactory to legal counsel for the Corporation containing the above
representations, stating that certificates representing such shares may bear a
legend restricting their transfer and stating that the Corporation's transfer
agent or agents may be given instructions to stop transfer of any certificate
bearing such legend. Such representation and restrictions provided for herein
shall not be required if (i) an effective registration statement for such shares
under the Securities Act of 1933, as amended, and any applicable state laws has
been filed with the Securities and Exchange Commission and
9
<PAGE>
with the appropriate agency or commission of any state whose laws apply to the
transaction, or (ii) an opinion of counsel satisfactory to the Corporation has
been delivered to the Corporation to the effect that registration is not
required under the Securities Act of 1933, as amended, or under the applicable
securities laws of any state. Any determination by the Committee regarding the
foregoing shall be final, binding, and conclusive . The Corporation shall not be
obligated to take any affirmative action in order to cause the exercise of an
Option or the issuance of shares pursuant thereto to comply with any law or
regulation or any governmental authority.
(b) RESTRICTION ON TRANSFER OF STOCK. Unless a registration statement under
the Securities Act of 1933, as amended, is in effect, the certificate or
certificates for Stock issued upon the exercise of an Option shall bear the
following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
PURSUANT TO AN INVESTMENT REPRESENTATION ON THE PART OF THE HOLDER
THEREOF AND SHALL NOT BE SOLD, PLEDGED, HYPOTHECATED, DONATED, OR
OTHERWISE TRANSFERRED, WHETHER OR NOT FOR CONSIDERATION, EXCEPT UPON THE
ISSUANCE TO THE ISSUER OF A FAVORABLE OPINION OF ITS COUNSEL AND/OR THE
SUBMISSION OF OTHER EVIDENCE SATISFACTORY TO COUNSEL TO THE ISSUER, TO
THE EFFECT THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE
SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES
LAWS.
16. AMENDMENT AND TERMINATION OF THE PLAN.
The Board may, at any time and from time to time, amend, suspend or terminate
the Plan as to any shares of Stock as to which Options have not been granted.
Except as permitted under Section 17 hereof, no amendment, suspension or
termination of the Plan shall, without the consent of the holder of the Option,
alter or impair rights or obligations under any Option theretofore granted under
the Plan. In no event, however, shall any amendment result in any of the
following, unless holders of at least a majority of the shares voted approve
such amendment:
Increasing the number of shares available for Options (except subject to
adjustments as provided in Section 17 of the Plan); or
Materially increasing benefits available to participants in the Plan.
17. EFFECT OF CHANGES IN CAPITALIZATION.
10
<PAGE>
(a) CHANGES IN STOCK. If the outstanding shares of Stock are increased or
decreased or changed into or exchanged for a different number of kind of shares
or other securities of the Corporation by reason of any recapitalization,
reclassification, stock split-up, combination of shares, exchange of shares,
stock divided or other distribution payable in capital stock, or other increase
or decrease in such shares effected without receipt of consideration by the
Corporation, occurring after the effective date of the Plan, the number and
kinds of shares for the purchase of which Options may be granted under the Plan
shall be adjusted proportionately and accordingly by the Corporation. In
addition, the number and kind of shares for which Options are outstanding shall
be adjusted proportionately and accordingly so that the proportionate interest
of the holder of the Option immediately following such event shall, to the
extent practicable, be the same as immediately prior to such event. Any such
adjustment in outstanding Options shall not change the aggregate Option Price
payable with respect to shares subject to the unexercised portion in the Option
outstanding but shall include a corresponding proportionate adjustment in the
Option price per share.
(b) REORGANIZATION IN WHICH THE CORPORATION IS THE SURVIVING CORPORATION.
Subject to Subsection (d) hereof, if the Corporation shall be the surviving
corporation in any reorganization, merger, share exchange or consolidation of
the Corporation with one or more other corporations, any Option theretofore
granted pursuant to the Plan shall pertain to and apply to the securities to
which a holder of the number of shares of Stock subject to such Option would
have been entitled immediately following such reorganization, merger, or
consolidation, with a corresponding proportionate adjustment of the Option Price
per share so that the aggregate Option Price thereafter shall be the same as the
aggregate Option Price of the shares remaining subject to the Option immediately
prior to such reorganization, merger, or consolidation.
(c) REORGANIZATION IN WHICH THE CORPORATION IS NOT THE SURVIVING CORPORATION
OR SALE OF ASSETS OR STOCK. In the event of the commencement of a tender offer
(other than by the Corporation) for any shares of the corporation or a sale or
transfer, in one or a series of transactions, of assets having a fair market
value of 50% or more of the fair market value of all assets of the Corporation,
or a merger, consolidation or share exchange pursuant to which shares of the
Corporation may be exchanged for or converted into cash, property or securities
of another issuer, or the liquidation of the Corporation (an "Extraordinary
Event"), then regardless of whether or not any Option granted pursuant to the
Plan shall have vested or become fully exercisable, all Options granted pursuant
to the Plan shall immediately vest and become fully exercisable for the full
number of
11
<PAGE>
shares subject to any such Option on and at all times after the "Event Date" of
the Extraordinary Event.
(i) The "Event Date" is the date of the commencement of the tender
offer, if the Extraordinary event is a tender offer, and in the case of any
other Extraordinary Event, the day preceding the date as of which
shareholders of record become entitled to the consideration payable in
respect of such Extraordinary Event.
(ii) In the event of the exercise pursuant to this Section of any Option
the Option Price for which shall not have been fixed as of the Event Date,
the Option Price in respect of such Option shall be equal to the average fair
market value (determined in the manner described in Section 9 above) for the
30 days preceding the announcement or other publication of the Extraordinary
Event.
(iii) In the event that an Optionee fails to exercise his or her Option,
in whole or in part, pursuant to this Section upon an Extraordinary Event,
the Corporation shall take such action as may be necessary to enable each
Optionee to receive upon any subsequent exercise of his or her Option, in
whole or in part, in lieu of shares of the Corporation, securities or other
assets as were issuable or payable upon such Extraordinary Event in respect
of, or in exchange for, such shares.
(d) ADJUSTMENTS. Adjustments under this Section 17 related to stock or
securities of the Corporation shall be made by the Committee, whose
determination in that respect shall be final, binding, and conclusive. No
fractional shares of Stock or units of other securities shall be issued pursuant
to any such adjustment, and any fractions resulting from any such adjustment
shall be eliminated in each case by rounding downward to the nearest whole share
or unit.
(e) NO LIMITATIONS ON CORPORATION. The grant of an Option pursuant to the
Plan shall not affect or limit in any way the right or power of the Corporation
to make adjustments, to effect reclassifications, reorganizations or changes of
its capital or business structure or to merge, consolidate, dissolve or
liquidate, or sell or transfer all or any part of its business or assets.
18. DISCLAIMER OF RIGHTS.
No provision in the Plan or in any Option granted or Option Agreement entered
into pursuant to the Plan shall be construed to confer upon any individual the
right to remain in the employ or service of the Corporation or any Subsidiary,
or to interfere in any way with the right and authority of the Corporation or
any Subsidiary
12
<PAGE>
either to increase or decrease the compensation of any individual at any time,
or to terminate any employment or other relationship between any individual and
the Corporation or any Subsidiary.
19. NON-EXCLUSIVITY OF THE PLAN.
Neither the adoption of the Plan nor the submission of the Plan to the
shareholders of the Corporation for approval shall be construed as creating any
limitations upon the right and authority of the Board to adopt such other
incentive compensation arrangements (which arrangements may be applicable either
generally to a class or classes of individual or specifically to a particular
individual or individual(s) as the Board in its discretion determines desirable,
including, without limitation, the granting of stock options otherwise than
under the Plan.
20. WITHHOLDING.
All awards and payments under the Plan which are made to employees of the
Corporation are subject to withholding of all applicable taxes and the
Corporation shall have the right to withhold from any such award under the Plan
or to collect as a condition of any payment under the Plan, as applicable, any
taxes required by law to be withheld. To the extent provided by the Committee,
an Optionee may elect to have shares of Stock withheld upon the exercise of an
Option, or to surrender to the Corporation shares of Stock already owned by the
Optionee, to fulfill any tax withholding obligation.
13
<TABLE> <S> <C>
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<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<CASH> 93,000
<INT-BEARING-DEPOSITS> 15,000
<FED-FUNDS-SOLD> 2,945,000
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<INVESTMENTS-HELD-FOR-SALE> 531,000
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<ALLOWANCE> (70,000)
<TOTAL-ASSETS> 11,385,000
<DEPOSITS> 8,392,000
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0
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<COMMON> 3,000
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