SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [_]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[_] Definitive Additional Materials by Rule 14a-6(e)(2))
[_] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
WYMAN PARK BANCORPORATION, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
________________________________________________________________________________
1) Title of each class of securities to which transaction applies:
________________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
________________________________________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
________________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
________________________________________________________________________________
5) Total fee paid:
[_] Fee paid previously with preliminary materials:
________________________________________________________________________________
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
(SC14A-07/98)
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[WYMAN PARK BANCORPORATION, INC. LETTERHEAD]
December 8, 1998
Dear Fellow Stockholder:
On behalf of the Board of Directors and management of Wyman Park
Bancorporation, Inc. (the "Company"), I cordially invite you to attend the
Special Meeting of Stockholders. The meeting will be held at 3:00 p.m.,
Lutherville, Maryland time on January 20, 1999 at the main office located at 11
West Ridgely Road, Lutherville, Maryland.
An important aspect of the meeting process is the stockholder vote on
corporate business items. I urge you to exercise your rights as a stockholder to
vote and participate in this process. Stockholders are being asked to consider
and vote upon proposals to ratify the adoption of the 1999 Stock Option and
Incentive Plan and the Recognition and Retention Plan. The Board has carefully
considered both of these proposals and believes that their approval will enhance
the ability of the Company to recruit and retain quality directors and
management. Accordingly, your Board of Directors unanimously recommends that you
vote FOR both of the proposals.
I encourage you to attend the meeting in person. Whether or not you attend
the meeting, I hope that you will read the enclosed Proxy Statement and then
complete, sign and date the enclosed proxy card and return it in the postage
prepaid envelope provided. This will save the Company additional expense in
soliciting proxies and will ensure that your shares are represented. Please note
that you may vote in person at the meeting even if you have previously returned
the proxy card.
Thank you for your attention to this important matter.
Sincerely,
/s/ ERNEST A. MORETTI
ERNEST A. MORETTI
President and Chief Executive Officer
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WYMAN PARK BANCORPORATION, INC.
11 West Ridgely Road
Lutherville, Maryland 21093
(410) 252-6450
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To be Held on January 20, 1999
Notice is hereby given that the Special Meeting of Stockholders (the
"Meeting") of Wyman Park Bancorporation, Inc. (the "Company") will be held at
the Company's main office located at 11 West Ridgely Road, Lutherville, Maryland
at 3:00 p.m., Lutherville, Maryland time, on January 20, 1999.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. The ratification of the adoption of the Company's 1999 Stock Option and
Incentive Plan;
2. The ratification of the adoption of the Company's Recognition and
Retention Plan;
and such other matters as may properly come before the Meeting, or any
adjournments thereof. The Board of Directors is not aware of any other business
to come before the Meeting.
Any action may be taken on the foregoing proposals at the Meeting on the
date specified above, or on any date or dates to which the Meeting may be
adjourned. Stockholders of record at the close of business on December 1, 1998
are the stockholders entitled to vote at the Meeting and any adjournments
thereof.
You are requested to complete and sign the enclosed proxy card, which is
solicited on behalf of the Board of Directors, and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend and vote at the
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ ERNEST A. MORETTI
Ernest A. Moretti
President and Chief Executive Officer
Lutherville, Maryland
December 8, 1998
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING. A SELF-
ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF
MAILED WITHIN THE UNITED STATES.
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PROXY STATEMENT
WYMAN PARK BANCORPORATION, INC.
11 West Ridgely Road
Lutherville, Maryland 21093
(410) 252-6450
SPECIAL MEETING OF STOCKHOLDERS
January 20, 1999
This Proxy Statement is furnished in connection with the solicitation on
behalf of the Board of Directors of Wyman Park Bancorporation, Inc. (the
"Company"), the parent company of Wyman Park Federal Savings & Loan Association
(the "Association"), of proxies to be used at the Special Meeting of
Stockholders of the Company (the "Meeting") which will be held at the Company's
main office located at 11 West Ridgely Road, Lutherville, Maryland on January
20, 1999, at 3:00 p.m., Lutherville, Maryland time, and all adjournments of the
Meeting. The accompanying Notice of Annual Meeting and this Proxy Statement are
first being mailed to stockholders on or about December 8, 1998.
At the Meeting, stockholders of the Company are being asked to consider and
vote upon proposals to ratify the adoption of the Wyman Park Bancorporation,
Inc. 1999 Stock Option and Incentive Plan (the "Stock Option Plan") and the
Wyman Park Bancorporation, Inc. Recognition and Retention Plan (the "RRP").
Vote Required and Proxy Information
All shares of the Company's Common Stock, par value $.01 per share (the
"Common Stock"), represented at the Meeting by properly executed proxies
received prior to or at the Meeting, and not revoked, will be voted at the
Meeting in accordance with the instructions thereon. If no instructions are
indicated, properly executed proxies will be voted for the proposals set forth
in this Proxy Statement. The Company does not know of any matters, other than as
described in the Notice of Special Meeting, that are to come before the Meeting.
If any other matters are properly presented at the Meeting for action, the
persons named in the enclosed proxy card and acting thereunder will have the
discretion to vote on such matters in accordance with their best judgment.
The affirmative vote by the holders of a majority of the votes cast at the
meeting shall be the act of the stockholders. Proxies marked to abstain with
respect to a proposal have the same effect as votes against the proposal. Broker
non-votes have no effect on the vote. One-third of the shares of the Common
Stock, present in person or represented by proxy, shall constitute a quorum for
purposes of the Meeting. Abstentions and broker non-votes are counted for
purposes of determining a quorum.
A proxy given pursuant to this solicitation may be revoked at any time
before it is voted. Proxies may be revoked by: (i) filing with the Secretary of
the Company at or before the Meeting a written notice of revocation bearing a
later date than the proxy, (ii) duly executing a subsequent proxy relating to
the same shares and delivering it to the Secretary of the Company at or before
the Meeting, or (iii) attending the Meeting and voting in person (although
attendance at the Meeting will not in and of itself constitute revocation of a
proxy). Any written notice revoking a proxy should be delivered to Secretary,
Wyman Park Bancorporation, Inc., 11 West Ridgely Road, Lutherville, Maryland
21093.
Voting Securities and Certain Holders Thereof
Stockholders of record as of the close of business on December 1, 1998 will
be entitled to one vote for each share of Common Stock then held. As of that
date, the Company had 966,313 shares of Common Stock issued and outstanding. The
following table sets forth information regarding share ownership of those
persons or entities known by management to beneficially own more than five
percent of the Common Stock and all directors and executive officers of the
Company and the Association as a group.
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Shares
Beneficially
Owned
at December Percent
Beneficial Owner 1, 1998 of Class
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Jeffrey L. Gendell, 95,200 9.85%
Tontine Financial Partners, L.P. and
Tontine Management, L.L.C.
200 Park Avenue, Suite 3900
New York, New York 10166(1)
Terry Maltese, 90,000 9.31
Sandler O'Neill Asset Management LLC,
SOAM Holdings, LLC,
Malta Partners, L.P.,
Malta Hedge Fund, L.P.,
Malta Partners II, L.P., and
Malta Hedge Fund II, L.P.
712 Fifth Avenue, 22nd Floor
New York, New York 10019(2)
Wyman Park Bancorporation, Inc.'s 80,937 8.38
Employee Stock Ownership Plan(3)
Allan B. Heaver, Chairman of the Board 9,000 0.93
H. Douglas Huether, Director 10,000 1.03
Jay H. Salkin, Director 10,200 1.06
Ernest A. Moretti, Director, President and CEO 10,199 1.06
John K. White, Director 5,000 0.52
G. Scott Barhight, Director 350 0.03
John R. Beever, Director 10,000 1.03
Albert M. Copp, Director 1,160 0.12
Gilbert D. Marsiglia, Sr., Director 4,500 0.47
Directors and executive officers of the Company 65,663 6.80
and the Association, as a group (11 persons)(4)
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(1) As reported on Amendment No. 2 to a Schedule 13D under the Exchange Act of
1934 (the "Exchange Act), dated June 22, 1998.
(2) As reported by Sandler O'Neill Asset Management LLC ("SOAM"); SOAM
Holdings, LLC ("Holdings"); Malta Partners, L.P. ("MP"); Malta Hedge Fund,
L.P. ("MHF"); Malta Partners II, L.P. ("MPII"); Malta Hedge Fund II, L.P.
("MHII") and Terry Maltese in a statement as of September 25, 1998 on
Amendment No. Two to a Schedule 13D under the Exchange Act. MP beneficially
owned 37,000 shares of Common Stock; MHF beneficially owned 24,800 shares
of Common Stock; MPII beneficially owned 14,200 shares of Common
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Stock; MHFII beneficially owned 14,000 shares of Common Stock; Holdings
owned zero shares directly, but may be deemed to beneficially own 90,000
shares of Common Stock because of its position as general partner of MP,
MHF, MPII and MHFII; SOAM owned zero shares directly, but may be deemed to
beneficially own 90,000 shares of Common Stock by reason of its position as
management company for MP, MHF, MPII and MHFII; and Mr. Maltese owns zero
shares directly, but may be deemed to beneficially own 70,900 shares of
Common Stock by reason of his position as President of Holdings and SOAM.
Terry Maltese, SOAM and Holdings each reported shared voting and
dispositive power with respect to all shares reported. MP reported shared
voting and dispositive power with respect to 37,000 shares; MPII reported
shared voting and dispositive power with respect to 14,200 shares; MHF
reported shared voting and dispositive power with respect to 24,800 shares,
and MHFII reported shared voting and dispositive power with respect to
14,000 shares.
(3) The amount reported represents shares held by the Employee Stock Ownership
Plan ("ESOP"), 8,928 of which have been allocated to accounts of
participants. First Bankers Trust Co., N.A., the Trustee of the ESOP, may
be deemed beneficially to own the shares held by the ESOP which have not
been allocated to the participants.
(4) Amount includes shares held directly, as well as shares held jointly with
family members, shares held in retirement accounts, shares allocated to the
ESOP accounts of the group members, held in a fiduciary capacity or by
certain family members, with respect to which shares the group members may
be deemed to have sole voting and/or investment power.
Director Compensation
Directors are currently not compensated for membership on the Board of
Directors of the Company. Each director of the Association is currently paid a
fee of $575 for each regular meeting attended. Non-employee directors receive
committee fees of $175 for each meeting attended. Employee directors do not
receive fees for participation on any committees.
Executive Compensation
The Company has not paid any compensation to its executive officers since
its formation. The following table sets forth information concerning the
compensation paid or granted to the Association's Chief Executive Officer for
services rendered by the Association's Chief Executive Officer. No other
executive officer of the Company has aggregate compensation (salary plus bonus)
in excess of $100,000 in fiscal 1998.
<TABLE>
<CAPTION>
Summary Compensation Table
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Long-Term Compensation
Annual Compensation Awards
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Restricted
Name and Principal Other Annual Stock Options/ All Other
Position Year(1) Salary($) Bonus($) Compensation($) Award($) SARs(#) Compensation($)
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<S> <C> <C> <C> <C> <C> <C>
Ernest A. Moretti 1998 $115,000 $24,700 $-- $-- --/-- $335,369(2)
President, Chief Executive 1997 115,000 23,000 -- -- --/-- 10,550
Officer and Director
</TABLE>
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(1) In accordance with the revised rules on executive officer and director
compensation disclosure adopted by the Securities and Exchange Commission,
Summary Compensation information is excluded for the year ended June 30,
1996, as the Association was not a public company during such period.
(2) Includes $4,818 of life, health and disability premiums paid by the
Association, $3,087 paid by the Association in discretionary contributions
pursuant to the Association's 401(k) Plan, a one-time contribution of
$271,941 plus accrued interest of $15,684 to fund the executive
supplemental retirement plan for Mr. Moretti, the value of a car provided
to Mr. Moretti of $1,435 and the value of 2,730 shares allocated to Mr.
Moretti under the Company's ESOP at June 30, 1998.
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Employment Agreement. The Association has an employment contract with
President Moretti. The agreement provides for a salary of $115,000, contains
bonus provisions tied to the Association's performance and has a term of three
years (subject to an annual extension for an additional year following an annual
performance review). The agreement provides that under certain circumstances,
including a change in control, Mr. Moretti would be entitled, subject to certain
limitations, to a severance payment in lieu of salary equal to a percentage of
his base amount of compensation, as defined. The contract provides for
termination upon the employee's death, for cause or in certain events specified
by OTS regulations. The employment contract is terminable by the employee upon
90 days' notice to the Association.
In the event there is a change in control of the Association, as defined in
the agreement, if employment terminates involuntarily in connection with such
change in control or within 12 months thereafter, the employment contract
provides for a payment equal to 299% of Mr. Moretti's base amount of
compensation as defined in the Internal Revenue Code. Assuming a change in
control were to take place as of June 30, 1998, the aggregate amounts payable to
Mr. Moretti pursuant to this change in control provision would be approximately
$343,850.
The contract provides, among other things, for participation in an
equitable manner in employee benefits applicable to executive personnel. The
employment contract may have an "anti-takeover" effect that could affect a
proposed future acquisition of control of the Company.
Executive Supplemental Retirement Plan. Effective fiscal 1998, the
Association adopted the Wyman Park Federal Savings and Loan Association
Executive Supplemental Retirement Plan (the "SERP") for the benefit of Mr.
Moretti. The SERP provides for payment of a specified amount to Mr. Moretti, as
President of the Association, upon the occurrence of the later of (i) Mr.
Moretti's attainment of age 65 or (ii) the termination (other than for cause) of
Mr. Moretti as President of the Association ("Payment Event"). Specifically,
upon the occurrence of a Payment Event, Mr. Moretti shall be entitled to an
annual amount, payable in twelve (12) monthly installments, over the greater of
the life of Mr. Moretti or one hundred twenty (120) months, equal to the excess
of (A) sixty-five percent of Mr. Moretti's highest five-year average annual
compensation, as defined in the defined benefit retirement plan provided by the
Association (the "Qualified Plan"), but without regard to the limitations
imposed by Section 401(a)(17) of the Internal Revenue Code of 1986, as amended,
reduced by (B) Mr. Moretti's annualized monthly retirement benefit payable under
the Qualified Plan under the normal form of benefit, as defined as of September
30, 1997, under the Qualified Plan, such form being a 10-year certain and
continuous annuity.
PROPOSAL I - RATIFICATION OF THE 1999 STOCK OPTION AND INCENTIVE PLAN
General
Establishment and implementation of the Stock Option Plan is subject to
ratification by stockholders
The Stock Option Plan has been adopted by the Board of Directors of the
Company, subject to ratification by stockholders at the Meeting. Ratification by
stockholders of the adoption of the Stock Option Plan will ratify the awards
proposed thereunder and as described in "Awards Under the Stock Option Plan"
below, and will ratify the granting of additional awards pursuant to the
provisions of the Stock Option Plan. Pursuant to the Stock Option Plan, the
Company will reserve for issuance thereunder either from authorized but unissued
shares or from issued shares reacquired and held as treasury shares, 101,171
shares of the Common Stock (10.0% of the Company's shares issued in its initial
public offering). Management currently intends, to the extent practicable and
feasible, to fund the Stock Option Plan from issued shares reacquired by the
Company in the open market. To the extent the Company utilizes authorized but
unissued Common Stock to fund the Stock Option Plan, the exercise of stock
options will have the effect of diluting the holdings of persons who own Common
Stock. Assuming all options under the Stock Option Plan are awarded and
exercised through the use of authorized but unissued Common Stock, current
stockholders would be diluted by approximately 9.5%. Upon ratification of the
Stock Option Plan by stockholders, options to purchase an aggregate of 85,990
shares of Common Stock will be awarded, which will leave available 15,181shares
for future awards.
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The Board of Directors believes that it is appropriate for the Company to
adopt a flexible and comprehensive Stock Option Plan which permits the granting
of a variety of long-term incentive awards to directors, advisory directors,
officers and employees as a means of enhancing and encouraging the recruitment
and retention of those individuals on whom the continued success of the Company
most depends. However, because the awards are granted only to persons affiliated
with the Company, the adoption of the Stock Option Plan could make it more
difficult for a third party to acquire control of the Company and therefore
could discourage offers for the Company's stock that may be viewed by the
Company's stockholders to be in their best interest. In addition, certain
provisions included in the Company's Certificate of Incorporation and Bylaws may
discourage potential takeover attempts, particularly those that have not been
negotiated directly with the Board of Directors of the Company. Included among
these provisions are provisions (i) limiting the voting power of shares held by
persons owning 10% or more of the Common Stock, (ii) requiring a supermajority
vote of stockholders for approval of certain business combinations, (iii)
establishing a staggered Board of Directors, (iv) permitting special meetings of
stockholders to be called only by the Board of Directors and (v) authorizing a
class of preferred stock with terms to be established by the Board of Directors.
These provisions could prevent the sale or merger of the Company even where a
majority of the stockholders approve of such transaction.
In addition, federal regulations prohibit the beneficial ownership of more
than 10% of the stock of a converted savings institution or its holding company
without prior approval of the OTS. Federal law and regulations also require OTS
approval prior to the acquisition of "control" (as defined in the OTS
regulations) of an insured institution, including a holding company thereof.
These regulations could have the effect of discouraging takeover attempts of the
Company.
Attached as Exhibit A to this Proxy Statement is the complete text of the
Stock Option Plan. The principal features of the Stock Option Plan are
summarized below.
Principal Features of the Stock Option Plan
The Stock Option Plan provides for awards in the form of stock options,
stock appreciation rights ("SARs") and limited stock appreciation rights
("Limited SARs"). Each award shall be on such terms and conditions, consistent
with the Stock Option Plan, as the committee administering the Stock Option Plan
may determine. Subject to certain exceptions described herein, awards made under
such plan vest at a rate of one-fifth of the initial award per year, subject to
the participant maintaining continuous service since the date of grant.
Shares may be either authorized but unissued shares or reacquired shares
held by the Company in its treasury. Any shares subject to an award which
expires or is terminated unexercised will again be available for issuance under
the Stock Option Plan or any other plan of the Company or its subsidiaries.
Generally, no award or any right or interest therein is assignable or
transferable except under certain limited exceptions set forth in the Stock
Option Plan.
The Stock Option Plan is administered by the RRP and SOP Committee of the
Board of Directors of the Company, which is comprised of non-employee directors
of the Company. Directors, Heaver, Huether and Salkin have been appointed as the
present members of the RRP and SOP Committee. Pursuant to the terms of the Stock
Option Plan, any director, advisory director, emeritus director, officer or
employee of the Company or its affiliates is eligible to participate in the
Stock Option Plan, which currently includes approximately 24 persons. In
granting awards under the Stock Option Plan, the RRP and SOP Committee
considers, among other things, position and years of service, value of the
participant's services to the Company and the Association, and the added
responsibilities of such individuals as employees, directors and officers of a
public company.
Stock Options
The term of stock options will not exceed ten years from the date of grant.
The RRP and SOP Committee may grant either "incentive stock options" as defined
under Section 422 of the Code or stock options not intended to qualify as such
("non-qualified stock options").
In general, stock options will not be exercisable after the expiration of
their terms. Unless otherwise determined by the RRP and SOP Committee, in the
event a participant ceases to maintain continuous service (as defined in the
Stock Option Plan) with the Company or one of its affiliates, for any reason
other than termination for cause, an
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<PAGE>
exercisable stock option will continue to be exercisable for three months
thereafter but in no event after the expiration date of the option. Unless
otherwise provided by the RRP and SOP Committee, if a participant to whom an
option was granted ceases to maintain continuous service by reason of normal
retirement, early retirement or disability, all options granted and not then
exercisable shall become exercisable in full for a period of three months
following such date. Unless otherwise provided by the RRP and SOP Committee, in
the event of the death of a participant during such service or within the
three-month period described above following termination of service, an
exercisable option will continue to be exercisable for one year, to the extent
exercisable by the participant immediately prior to his death, but in no event
later than ten years after grant. Following the death of any participant, the
RRP and SOP Committee may, as an alternative means of settlement of an option,
elect to pay to the holder thereof an amount of cash equal to the amount by
which the market value of the shares covered by the option on the date of
exercise exceeds the exercise price. A stock option will automatically terminate
and will no longer be exercisable as of the date a participant is notified of
termination for cause.
The exercise price for the purchase of shares subject to a stock option at
the date of grant may not be less than 100% of the market value of the shares
covered by the option on the date of grant of such stock options. The exercise
price must be paid in full in cash or shares of Common Stock, or a combination
of both.
The Stock Option Plan provides for the grant of a non-qualified stock
option to purchase 5,058 shares of Common Stock to each director who is not an
employee of the Company, as of the date of stockholder ratification of the Stock
Option Plan. Such options have a term of ten years, are not transferable and
vest at the rate of 20% per year commencing from the date of grant of the stock
option. The exercise price per share of the options shall be equal to the fair
market value of the Common Stock on the date of grant of such stock option.
Stock Appreciation Rights
The RRP and SOP Committee may grant SARs at any time, whether or not the
participant then holds stock options, granting the right to receive the excess
of the market value of the shares represented by the SARs on the date exercised
over the exercise price. SARs generally will be subject to the same terms and
conditions and exercisable to the same extent as stock options, as described
above. Upon the exercise of a SAR, the participant will receive the amount due
in cash or shares, or a combination of both, as determined by the RRP and SOP
Committee. SARs may be related to stock options ("tandem SARs"), in which case
the exercise of one will reduce to that extent the number of shares represented
by the other. Notwithstanding the foregoing, no SAR may be exercisable by a
director, Senior Officer or Ten Percent Beneficial owner of the Company within
six months of the date of its grant.
"Senior Officer" means the Company's president, principal financial officer
or principal accounting officer, any vice president of the Company in charge of
a principal business unit, division or function (such as sales, administration
or finance), any other officer who performs a policy-making function, or any
other person who performs similar policy-making functions for the Company.
Officers of the Company's affiliates shall be deemed Senior Officers of the
Company if they perform such policy-making functions for the Company. "Ten
Percent Beneficial Owner" means the beneficial owner of more than ten percent of
any class of the Company's equity securities registered pursuant to Section 12
of the Securities Exchange Act of 1934.
SARs will require an expense accrual by the Company each year for the
appreciation on the SARs which it is anticipated will be exercised. The amount
of the accrual is dependent upon whether and the extent to which the SARs are
granted and the amount, if any, by which the market value of the SARs exceeds
the exercise price.
Limited Stock Appreciation Rights
Limited SARs will be exercisable only for a limited period in the event of
a tender or exchange offer for shares of the Company's Common Stock, other than
by the Company, where 25% or more of the outstanding shares are acquired in that
offer or any other offer which expires within 60 days of that offer. The amount
paid on exercise of a Limited SAR will be the excess of (a) the market value of
the shares on the date of exercise, or (b) the highest price paid pursuant to
the offer, over the exercise price. Payment upon exercise of a Limited SAR will
be in cash.
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Limited SARs may be granted at the time of, and must be related to, the
grant of a stock option or SAR. The exercise of one will reduce to that extent
the number of shares represented by the other. Subject to vesting, Limited SARs
will be exercisable only for the 45 days following the expiration of the tender
or exchange offer, during which period the related stock option or SAR will be
exercisable. However, no Limited SAR will be exercisable by a director, Senior
Officer or Ten Percent Beneficial Owner of the Company within six months of the
date of its grant.
Effect of Change in Control and Other Adjustments
The restricted period with respect to options granted pursuant to the Stock
Option Plan will lapse, and the stock options will be earned, in the event of a
change in control, unless otherwise determined by the RRP and SOP Committee. A
change in control will be deemed to occur when (i) any third person, including a
"group" as defined in Section 13(d)(3) of the Securities Exchange Act of 1934,
as amended, shall become the beneficial owner of shares of the Company with
respect to which 25% or more of the total number of votes for the election of
the Board of Directors of the Company may be cast, (ii) as a result of, or in
connection with, any cash tender offer, merger or other business combination,
sale of assets or contested election, or combination of the foregoing, the
persons who were directors of the Company shall cease to constitute a majority
of the Board of Directors of the Company, or (iii) the stockholders of the
Company shall approve an agreement providing either for a transaction in which
the Company will cease to be an independent publicly-owned corporation or for a
sale or other disposition of all or substantially all the assets of the Company.
Shares as to which awards may be granted under the Stock Option Plan, and
shares then subject to awards, will be adjusted appropriately by the RRP and SOP
Committee in the event of any merger, consolidation, reorganization,
recapitalization, stock dividend, stock split or other change in the corporate
structure or Common Stock of the Company.
In the event of any merger, consolidation or combination of the Company
with or into another financial institution holding company or other entity,
whereby either the Company is not the continuing entity or its outstanding
shares of Common Stock are converted into or exchanged for different securities,
cash or property, or any combination thereof, pursuant to a plan or agreement
the terms of which are binding upon all stockholders, any participant to whom a
stock option, SAR or Limited SAR has been granted will have the right upon
exercise of the option, SAR or Limited SAR (subject to the terms of the Stock
Option Plan and any other applicable limitation) to an amount equal to the
excess of fair market value on the date of exercise of the consideration
receivable in the merger, consolidation or combination with respect to the
shares covered or represented by the stock option, SAR or Limited SAR over the
exercise price of the option, SAR or Limited SAR multiplied by the number of
shares with respect to which the option, SAR or Limited SAR has been exercised.
Amendment and Termination
The Board of Directors of the Company may at any time amend, suspend or
terminate the Stock Option Plan or any portion thereof, but may not, without the
prior ratification of the stockholders, make any amendment which shall (i)
materially increase the aggregate number of securities which may be issued under
the Stock Option Plan (except as specifically set forth under the Stock Option
Plan), (ii) materially increase the aggregate number of securities which may be
issued under the Stock Option Plan to directors who are not employees of the
Company, or (iii) change the class of persons eligible to participate in the
Stock Option Plan, provided, however, that no such amendment, suspension or
termination shall impair the rights of any participant, without his consent, in
any award made pursuant to the Stock Option Plan. Unless previously terminated,
the Stock Option Plan shall continue in effect for a term of ten years, after
which no further awards may be granted under the Stock Option Plan.
Federal Income Tax Consequences
Under present federal income tax laws, awards under the Stock Option Plan
will have the following consequences:
(1) The grant of an award will neither, by itself, result in the
recognition of taxable income to the participant nor entitle the Company to a
deduction at the time of such grant.
(2) The exercise of a stock option which is an "Incentive Stock Option"
within the meaning of Section 422 of the Code will generally not, by itself,
result in the recognition of taxable income to the participant nor entitle the
7
<PAGE>
Company to a deduction at the time of such exercise. However, the difference
between the exercise price and the fair market value of the option shares on the
date of exercise is an item of tax preference which may, in certain situations,
trigger the alternative minimum tax. The alternative minimum tax is incurred
only when it exceeds the regular income tax. The alternative minimum tax will be
payable at the rate of 26% on the first $175,000 of "minimum taxable income"
above the exemption amount ($33,750 for single individual and $45,000 for
married individuals filing jointly), and 28% on minimum taxable income more than
$175,000 above the exemption amounts. If a taxpayer has alternative minimum
taxable income in excess of $150,000 (married individuals filing jointly) or
$112,500 (single individual), the $45,000 or $33,750 exemptions are reduced by
an amount equal to 25% of the amount by which the alternative minimum taxable
income of the taxpayer exceeds $150,000 or $112,500, respectively. The
participant will recognize long-term capital gain or loss upon resale of the
shares received upon such exercise, provided that the participant holds the
shares for more than one year following exercise.
(3) The exercise of a stock option which is not an Incentive Stock Option
will result in the recognition of ordinary income by the participant on the date
of exercise in an amount equal to the difference between the exercise price and
the fair market value on the date of exercise of the shares acquired pursuant to
the stock option.
(4) The exercise of a SAR will result in the recognition of ordinary income
by the participant on the date of exercise in an amount of cash, and/or the fair
market value on that date of the shares, acquired pursuant to the exercise.
(5) The Company will be allowed a deduction at the time, and in the amount
of, any ordinary income recognized by the participant under the various
circumstances described above, provided that the Company meets its federal
withholding tax obligations.
Awards Under the Stock Option Plan
The following table presents information at December 1, 1998, with respect
to the number of awards of options which are intended to be granted under the
Stock Option Plan, subject to stockholder ratification of the Stock Option Plan,
to (i) the Named Officer, (ii) all executive officers of the Company and the
Association as a group, (iii) directors who are not executive officers of the
Company and the Association as a group, and (iv) all non-executive officer
employees of the Company or the Association as a group. On December 1, 1998, the
average of the closing bid and asked prices for the Common Stock as quoted on
the OTC Electronic Bulletin Board was $11.50 per share.
<TABLE>
<CAPTION>
===========================================================================================
1998 STOCK OPTION AND INCENTIVE PLAN
- -------------------------------------------------------------------------------------------
Name and Position Dollar Value(1) Number of Shares
===========================================================================================
<S> <C> <C>
Ernest A. Moretti, Director, President and
Chief Executive Officer............................... $ --- 25,292
Executive Officer Group (3 persons)..................... --- 35,408
Non-Executive Officer Director Group (8 persons)........ --- 40,464
Non-Executive Officer Employee Group (2 persons)........ --- 10,118
===========================================================================================
</TABLE>
(1) Any value realized will be the difference between the exercise price and
the market value upon exercise. Since the options have not been granted,
there is no current value.
Subject to the conditions of the Stock Option Plan, the proposed awards
described in the preceding table will vest in five equal annual installments
with the first installment immediately vesting on the date of stockholder
ratification of the Stock Option Plan and the additional installments vesting
ratably on the four subsequent anniversaries of the date of stockholder
ratification of the Stock Option Plan. All options are required to be granted
with an exercise price equal to the fair market value of the shares on the date
of grant of such stock option.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE ADOPTION OF THE 1999 STOCK OPTION AND INCENTIVE PLAN.
8
<PAGE>
PROPOSAL II - RATIFICATION OF THE RECOGNITION AND RETENTION PLAN
General
Establishment and implementation of the Recognition and Retention Plan
("RRP") is subject to ratification by stockholders
The RRP has been adopted by the Board of Directors of the Company, subject
to stockholder ratification. The RRP is designed to provide directors, officers
and employees with a proprietary interest in the Company in a manner designed to
encourage such individuals to remain with the Company and the Association.
Ratification by stockholders of the adoption of the RRP will ratify the awards
proposed thereunder and as described in "Awards under the RRP" below, and will
ratify the granting of additional restricted stock awards pursuant to the
provisions of the RRP. Pursuant to the RRP, 40,468 shares of Common Stock (or
4.0% of the shares of the Company issued in its initial public offering), funded
from either authorized but unissued shares or issued shares subsequently
reacquired and held as treasury shares, will be available for awards. Management
currently intends, to the extent practicable and feasible, to fund the RRP from
issued shares reacquired by the Company in the open market. To the extent the
Company utilizes authorized but unissued shares to fund the RRP the interests of
current stockholders will be diluted. Assuming all RRP Shares are awarded
through the use of authorized but unissued Common Stock, current stockholders
would be diluted by approximately 4.0%. Upon ratification of the RRP by
stockholders, an aggregate of 34,394 shares of Common Stock will be awarded to
directors, officers and employees of the Company and the Association, which will
leave 6,074 shares available for future awards.
Attached as Exhibit B to this Proxy Statement is the complete text of the
form of the RRP. The principal features of the RRP are summarized below.
Principle Features of the RRP
The RRP provides for the award of shares of Common Stock ("RRP Shares")
subject to the restrictions described below. Each award under the RRP will be
made on such terms and conditions, consistent with the RRP, as the RRP and SOP
Committee shall determine.
The RRP is administered by the Company's RRP and SOP Committee, which is
comprised of directors Heaver, Huether and Salkin. The RRP and SOP Committee
will select the recipients and terms of awards pursuant to the RRP. In
determining to whom and in what amount to grant awards, the RRP and SOP
Committee considers the position and responsibilities of eligible individuals,
the value of their services to the Company and the Association, and other
factors it deems relevant. Pursuant to the terms of the RRP, any director,
advisory director, emeritus director, officer or employee of the Company or its
affiliates may be selected by the RRP and SOP Committee to participate in the
RRP, which currently includes eligible participants of approximately 24 persons.
The RRP provides that RRP Shares used to fund awards under the RRP may be
either authorized but unissued shares or reacquired shares held by the Company
in its treasury. Any RRP Shares which are forfeited will again be available for
issuance under the RRP or any other plan of the Company or its subsidiaries.
RRP award recipients earn (i.e., become vested in) awards, over a period of
time as determined by the RRP and SOP Committee, at the time of grant. RRP
Shares to be awarded in 1999 to directors, officers and employees will vest in
five equal annual installments, with the first installment vesting immediately
upon the date of ratification of the RRP by the Company's stockholders, subject
to the conditions described below. RRP Shares are subject to forfeiture if the
recipient fails to remain in the continuous service (as defined in the RRP) as
an employee, officer or director (including advisory and emeritus directors) of
the Company or the Association for a stipulated period (the "restricted
period"). Vested shares are distributed to recipients as soon as practicable
following the date on which they are earned.
The RRP and SOP Committee may, in its discretion, accelerate the time at
which any or all restrictions will lapse, or may remove any or all of the
restrictions. In the event a recipient ceases to maintain continuous service
with the Company or the Association by reason of early retirement, normal
retirement, death or disability, RRP Shares still subject to restrictions will
be free of these restrictions and shall not be forfeited. In the event of
termination for any other reason, all shares will be forfeited and returned to
the Company.
9
<PAGE>
Holders of RRP Shares may not sell, assign, transfer, pledge or otherwise
encumber any of the RRP Shares during the restricted period. All dividends
declared or paid on RRP shares, including those RRP shares still subject to
restrictions, will be paid to the participant.
Finally, the RRP provides for an award of 2,023 RRP Shares to each director
who is not an employee of the Company, as of the date of stockholder
ratification of the RRP.
Adjustments Upon Changes in Capitalization
The restricted period with respect to shares granted pursuant to the RRP
will lapse, and the stock will be earned, in the event of a change in control,
unless otherwise determined by the RRP and SOP Committee. A change in control
will be deemed to occur when (i) any third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,
shall become the beneficial owner of shares of the Company with respect to which
25% or more of the total number of votes for the election of the Board of
Directors of the Company may be cast, (ii) as a result of, or in connection
with, any cash tender offer, merger or other business combination, sale of
assets or contested election, or combination of the foregoing, the persons who
were directors of the Company shall cease to constitute a majority of the Board
of Directors of the Company, or (iii) the stockholders of the Company shall
approve an agreement providing either for a transaction in which the Company
will cease to be an independent publicly-owned corporation or for a sale or
other disposition of all or substantially all of the assets of the Company.
RRP Shares awarded under the RRP will be adjusted by the RRP and SOP
Committee in the event of a reorganization, recapitalization, stock split, stock
dividend, combination or exchange of shares, merger or other change in corporate
structure or the Common Stock of the Company.
Federal Income Tax Consequences
Holders of RRP Shares will recognize ordinary income on the date that the
RRP Shares are no longer subject to a substantial risk of forfeiture, in an
amount equal to the fair market value of the shares on that date. In certain
circumstances, a holder may elect to recognize ordinary income and determine
such fair market value on the date of the grant of the restricted stock. Holders
of RRP Shares will also recognize ordinary income equal to their dividend or
dividend equivalent payments when such payments are received.
Amendment to the RRP
The Board of Directors of the Company may amend, suspend or terminate the
RRP or any portion thereof at any time, provided however, that no such
amendment, suspension or termination shall materially impair the rights of any
participant, without his or her consent, in any award made pursuant to the RRP.
Notwithstanding anything in the RRP to the contrary, such provisions may not be
amended more than once every six months, other than to comport with changes in
the Code, ERISA or the rules thereunder.
10
<PAGE>
Awards Under the RRP
The following table presents information at December 1, 1998, with respect
to the number of shares of restricted stock which are intended to be granted
under the RRP, subject to stockholder ratification of the RRP, to (i) the Named
Officer (ii) all executive officers of the Company and the Association as a
group, and (iii) directors who are not executive officers of the Company or the
Association as a group, and (iv) all non-executive officer employees of the
Company or the Association as a group.
<TABLE>
<CAPTION>
====================================================================================================================
RECOGNITION AND RETENTION PLAN
- --------------------------------------------------------------------------------------------------------------------
Name and Position Dollar value(1) Shares of Restricted Stock
====================================================================================================================
<S> <C> <C>
Ernest A. Moretti, Director, President and Chief Executive Officer... $116,346 10,117
Executive Officer Group (3 persons).................................. 172,190 14,973
Non-Executive Officer Director Group (8 persons)..................... 186,116 16,184
Non-Executive Officer Employee Group (2 persons)..................... 37,226 3,237
====================================================================================================================
</TABLE>
- ----------
(1) Assumes an aggregate market value of the shares of restricted stock based
on the average of the closing bid and asked prices of the Common Stock of
$11.50 as reported on the OTC Electronic Bulletin Board on December 1,
1998.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE ADOPTION OF THE RECOGNITION AND RETENTION PLAN.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials for
the next annual meeting of stockholders, any stockholder proposal to take action
at such meeting must be received at the Company's office located at 11 West
Ridgely Road, Lutherville, Maryland 21093, no later than May 28, 1999. Any such
proposal shall be subject to the requirements of the proxy rules adopted under
the Exchange Act. If a proposal does not meet the above requirements for
inclusion in the Company's proxy materials, but otherwise meets the Company's
eligibility requirements to be presented at the next Annual Meeting of
Stockholders, the persons named in the enclosed form of proxy and acting thereon
will have the discretion to vote on any such proposal in accordance with their
best judgment if the proposal is received at the Company's main office later
than August 29, 1999.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matter should properly come before the Meeting, it is
intended that holders of the proxies will act in accordance with their best
judgment.
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. The Company has retained Regan &
Associates, Inc. to assist in the solicitation of proxies for a fee of $3,000,
plus reasonable out-of-pocked expenses not to exceed $1,750. In addition to
solicitation by mail, directors, officers and regular employees of the Company
and/or the Bank may solicit proxies personally or by telegraph or telephone
without additional compensation.
Lutherville, Maryland
December 8, 1998
11
<PAGE>
EXHIBIT A
WYMAN PARK BANCORPORATION, INC.
1999 STOCK OPTION AND INCENTIVE PLAN
1. Plan Purpose. The purpose of the Plan is to promote the long-term
interests of the Corporation and its stockholders by providing a means for
attracting and retaining directors, advisory directors, directors emeriti,
officers and employees of the Corporation and its Affiliates. It is intended
that designated Options granted pursuant to the provisions of this Plan to
persons employed by the Corporation or its Affiliates will qualify as Incentive
Stock Options. Options granted to persons who are not employees will be
Non-Qualified Stock Options.
2. Definitions. The following definitions are applicable to the Plan:
"Affiliate" - means any "parent corporation" or "subsidiary corporation" of
the Corporation, as such terms are defined in Section 424(e) and (f),
respectively, of the Code.
"Association" - means Wyman Park Federal Savings & Loan Association and
any successor entity.
"Award" - means the grant of an Incentive Stock Option, a Non-Qualified
Stock Option, a Stock Appreciation Right, a Limited Stock Appreciation Right or
any combination thereof, as provided in the Plan.
"Code" - means the Internal Revenue Code of 1986, as amended.
"Committee" - means the Committee of the Board of Directors referred to in
Section 3 hereof.
"Continuous Service" - means the absence of any interruption or termination
of service as a director, advisory director, director emeritus, officer or
employee of the Corporation or an Affiliate, except that when used with respect
to persons granted an Incentive Stock Option means the absence of any
interruption or termination of service as an Employee of the Corporation or an
Affiliate. Service shall not be considered interrupted in the case of sick
leave, military leave or any other leave of absence approved by the Corporation
or any Affiliate or in the case of transfers between payroll locations of the
Corporation or between the Corporation, its Affiliates or its successor. With
respect to any advisory director or director emeritus, continuous service shall
mean the availability to perform such functions as may be required of such
persons.
"Corporation" - means Wyman Park Bancorporation, Inc.
"Disability" - means any physical or mental impairment which qualifies a
director, advisory director, director emeritus, officer or employee for
disability benefits under any applicable long-term disability plan maintained by
the Association or an Affiliate, or, if no such plan applies, which
A-1
<PAGE>
renders such employee or director, in the judgment of the Committee, unable to
perform his customary duties and responsibilities.
"Early Retirement" -- means retirement from employment with or as a
director, advisory director, or emeritus director of the Corporation prior to
the Participant either (i) having reached the age of 62 or (ii) having
maintained Continuous Service for at least three years.
"Employee" - means any person, including an officer or director, who is
employed by the Corporation or any Affiliate.
"ERISA" - means the Employee Retirement Income Security Act of 1974, as
amended.
"Exercise Price" - means (i) in the case of an Option, the price per Share
at which the Shares subject to such Option may be purchased upon exercise of
such Option and (ii) in the case of a Right, the price per Share (other than the
Market Value per Share on the date of exercise and the Offer Price per Share as
defined in Section 10 hereof) which, upon grant, the Committee determines shall
be utilized in calculating the aggregate value which a Participant shall be
entitled to receive pursuant to Sections 9, 10 or 12 hereof upon exercise of
such Right.
"Incentive Stock Option" - means an option to purchase Shares granted by
the Committee pursuant to Section 6 hereof which is subject to the limitations
and restrictions of Section 8 hereof and is intended to qualify under Section
422(b) of the Code.
"Limited Stock Appreciation Right" - means a stock appreciation right with
respect to Shares granted by the Committee pursuant to Sections 6 and 10 hereof.
"Market Value" - means the average of the high and low quoted sales price
on the date in question (or, if there is no reported sale on such date, on the
last preceding date on which any reported sale occurred) of a Share on the
Composite Tape for the New York Stock Exchange-Listed Stocks, or, if on such
date the Shares are not quoted on the Composite Tape, on the New York Stock
Exchange, or, if the Shares are not listed or admitted to trading on such
Exchange, on the principal United States securities exchange registered under
the Securities Exchange Act of 1934 on which the Shares are listed or admitted
to trading, or, if the Shares are not listed or admitted to trading on any such
exchange, the mean between the closing high bid and low asked quotations with
respect to a Share on such date on the Nasdaq Stock Market, or any similar
system then in use, or, if no such quotations are available, the fair market
value on such date of a Share as the Committee shall determine.
"Non-Employee Director" - means a director who (a) is not currently an
officer or employee of the Corporation; (b) is not a former employee of the
Corporation who receives compensation for prior services (other than from a
tax-qualified retirement plan); (c) has not been an officer of the Corporation;
(d) does not receive renumeration from the Corporation in any capacity other
than as a director; and (e) does not possess an interest in any other
transactions or is not engaged in a business relationship for which disclosure
would be required under Item 404(a) or (b) of Regulation S-K.
A-2
<PAGE>
"Non-Qualified Stock Option" - means an option to purchase Shares granted
by the Committee pursuant to Section 6 hereof, which is not intended to qualify
under Section 422(b) of the Code.
"Normal Retirement" -- means retirement from employment with or as a
director, advisory director, or emeritus director of the Corporation after the
Participant has (i) reached the age of 65 and (ii) maintained Continuous Service
for at least three years.
"Option" - means an Incentive Stock Option or a Non-Qualified Stock Option.
"Participant" - means any director, advisory director, director emeritus,
officer or employee of the Corporation or any Affiliate who is selected by the
Committee to receive an Award or who is granted an Award.
"Plan" - means the 1999 Stock Option and Incentive Plan of the Corporation.
"Related" - means (i) in the case of a Right, a Right which is granted in
connection with, and to the extent exercisable, in whole or in part, in lieu of,
an Option or another Right and (ii) in the case of an Option, an Option with
respect to which and to the extent a Right is exercisable, in whole or in part,
in lieu thereof has been granted.
"Right" - means a Limited Stock Appreciation Right or a Stock Appreciation
Right.
"Shares" - means the common stock, par value $0.01 per share, of the
Corporation.
"Stock Appreciation Right" - means a stock appreciation right with respect
to Shares granted by the Committee pursuant to Sections 6 and 9 hereof.
3. Administration. The Plan shall be administered by a Committee consisting
of two or more members, each of whom shall be a Non-Employee Director. The
members of the Committee shall be appointed by the Board of Directors of the
Corporation. Except as limited by the express provisions of the Plan, the
Committee shall have sole and complete authority and discretion to (i) select
Participants and grant Awards; (ii) determine the number of Shares to be subject
to types of Awards generally, as well as to individual Awards granted under the
Plan; (iii) determine the terms and conditions upon which Awards shall be
granted under the Plan; (iv) prescribe the form and terms of instruments
evidencing such grants; and (v) establish from time to time regulations for the
administration of the Plan, interpret the Plan, and make all determinations
deemed necessary or advisable for the administration of the Plan.
A majority of the Committee shall constitute a quorum, and the acts of a
majority of the members present at any meeting at which a quorum is present, or
acts approved in writing by a ma jority of the Committee without a meeting,
shall be acts of the Committee.
4. Participation in Committee Awards. The Committee may select from time to
time Participants in the Plan from those directors (including advisory directors
and directors emeriti),
A-3
<PAGE>
officers and employees of the Corporation or its Affiliates who, in the opinion
of the Committee, have the capacity for contributing to the successful
performance of the Corporation or its Affiliates.
5. Shares Subject to Plan. Subject to adjustment by the operation of
Section 11 hereof, the maximum number of Shares with respect to which Awards may
be made under the Plan is 101,171 of the common shares of the Corporation. The
Shares with respect to which Awards may be made under the Plan may be either
authorized and unissued shares or issued shares heretofore or hereafter
reacquired and held as treasury shares. Shares which are subject to Related
Rights and Related Options shall be counted only once in determining whether the
maximum number of Shares with respect to which Awards may be granted under the
Plan has been exceeded. An Award shall not be considered to have been made under
the Plan with respect to any Option or Right which terminates and new Awards may
be granted under the Plan with respect to the number of Shares as to which such
termination has occurred.
6. General Terms and Conditions of Options and Rights. The Committee shall
have full and complete authority and discretion except as expressly limited by
the Plan, to grant Options and/or Rights and to provide the terms and conditions
(which need not be identical among Participants) thereof. In particular, the
Committee shall prescribe the following terms and conditions: (i) the Exercise
Price of any Option or Right, which shall not be less than the Market Value per
Share at the date of grant of such Option or Right, (ii) the number of Shares
subject to, and the expiration date of, any Option or Right, which expiration
date shall not exceed ten years from the date of grant, (iii) the manner, time
and rate (cumulative or otherwise) of exercise of such Option or Right, and (iv)
the restrictions, if any, to be placed upon such Option or Right or upon Shares
which may be issued upon exercise of such Option or Right. The Committee may, as
a condition of granting any Option or Right, require that a Participant agree
not to thereafter exercise one or more Options or Rights previously granted to
such Participant. No individual shall be granted Awards in any calendar year
with respect to more than 25,292 shares, subject to adjustment as provided in
Section 11.
At the time of any Award, the Participant shall enter into an agreement
with the Corporation in a form specified by the Committee, agreeing to the terms
and conditions of the Award and such other matters as the Committee, in its sole
discretion, shall determine (the "Option Agreement").
7. Exercise of Options or Rights.
(a) Except as provided herein, an Option or Right granted under the Plan shall
be exercisable during the lifetime of the Participant to whom such Option
or Right was granted only by such Participant and, except as provided in
paragraphs (c) and (d) of this Section 7, no such Option or Right may be
exercised unless at the time such Participant exercises such Option or
Right, such Participant has maintained Continuous Service since the date of
grant of such Option or Right.
(b) To exercise an Option or Right under the Plan, the Participant to whom such
Option or Right was granted shall give written notice to the Corporation in
form satisfactory to the Committee (and, if partial exercises have been
permitted by the Committee, by specifying the number of Shares with respect
to which such Participant elects to exercise such Option or Right) together
A-4
<PAGE>
with full payment of the Exercise Price, if any and to the extent required.
The date of exercise shall be the date on which such notice is received by
the Corporation. Payment, if any is required, shall be made either (i) in
cash (including check, bank draft or money order) or (ii) by delivering (A)
Shares already owned by the Participant and having a fair market value
equal to the applicable Exercise Price, such fair market value to be
determined in such appropriate manner as may be provided by the Committee
or as may be required in order to comply with or to conform to requirements
of any applicable laws or regulations, or (B) a combination of cash and
such Shares.
(c) If a Participant to whom an Option or Right was granted shall cease to
maintain Continuous Service for any reason other than termination for
cause, such Participant may, but only within the period of three months
immediately succeeding such cessation of Continuous Service and in no event
after the expiration date of such Option or Right, exercise such Option or
Right to the extent that such Participant was entitled to exercise such
Option or Right at the date of such cessation, provided, however, that such
right of exercise after cessation of Continuous Service shall not be
available to a Participant if the Committee otherwise determines and so
provides in the applicable instrument or instruments evidencing the grant
of such Option or Right. If a Participant to whom an Option or Right was
granted shall cease to maintain Continuous Service by reason of death,
Normal Retirement, Early Retirement, or Disability then, unless the
Committee shall have otherwise provided in the instrument evidencing the
grant of an Option or Right, all Options and Rights granted and not fully
exercisable shall become exercisable in full upon the happening of such
event and shall remain so exercisable (i) in the event of death for the
period described in paragraph (d) of this Section 7 and (ii) in the event
of Normal Retirement, Early Retirement or Disability, for a period of three
months following such date. If the Continuous Service of a Participant to
whom an Option or Right was granted by the Corporation is terminated for
cause, all rights under any Option or Right of such Participant shall
expire immediately upon the giving to the Participant of notice of such
termination.
(d) In the event of the death of a Participant while in the Continuous Service
of the Corporation or an Affiliate or within the three-month period
referred to in paragraph (c) of this Section 7, the person to whom any
Option or Right held by the Participant at the time of his death is
transferred by will or the laws of descent and distribution, or in the case
of an Award other than an Incentive Stock Option, pursuant to a qualified
domestic relations order, as defined in the Code or Title I of ERISA or the
rules thereunder may, but only to the extent such Participant was entitled
to exercise such Option or Right as set forth in paragraph (c) of this
Section 7, exercise such Option or Right at any time within a period of one
year succeeding the date of death of such Participant, but in no event
later than ten years from the date of grant of such Option or Right.
Following the death of any Participant to whom an Option was granted under
the Plan, irrespective of whether any Related Right shall have theretofore
been granted to the Participant or whether the person entitled to exercise
such Related Right desires to do so, the Committee may, as an alternative
means of settlement of such Option, elect to pay to the person to whom such
Option is transferred by will or by the laws of descent and distribution,
or in the case of an Option other than an Incentive Stock Option, pursuant
to a qualified domestic relations order, as defined in the Code or Title I
of ERISA or the rules
A-5
<PAGE>
thereunder, the amount by which the Market Value per Share on the date of
exercise of such Option shall exceed the Exercise Price of such Option,
multiplied by the number of Shares with respect to which such Option is
properly exercised. Any such settlement of an Option shall be considered an
exercise of such Option for all purposes of the Plan.
8. Incentive Stock Options. Incentive Stock Options may be granted only to
Participants who are Employees. Any provision of the Plan to the contrary
notwithstanding, (i) no Incentive Stock Option shall be granted more than ten
years from the date the Plan is adopted by the Board of Di rectors of the
Corporation and no Incentive Stock Option shall be exercisable more than ten
years from the date such Incentive Stock Option is granted, (ii) the Exercise
Price of any Incentive Stock Option shall not be less than the Market Value per
Share on the date of grant of such Incentive Stock Option, (iii) any Incentive
Stock Option shall not be transferable by the Participant to whom such Incentive
Stock Option is granted other than by will or the laws of descent and
distribution, and shall be exercisable during such Participant's lifetime only
by such Participant, (iv) no Incentive Stock Option shall be granted to any
individual who, at the time such Incentive Stock Option is granted, owns stock
possessing more than ten percent of the total combined voting power of all
classes of stock of the Corporation or any Affiliate unless the Exercise Price
of such Incentive Stock Option is at least 110 percent of the Market Value per
Share at the date of grant and such Incentive Stock Option is not exercisable
after the expiration of five years from the date such Incentive Stock Option is
granted, and (v) the aggregate Market Value (determined as of the time any
Incentive Stock Option is granted) of the Shares with respect to which Incentive
Stock Options are exercisable for the first time by a Participant in any
calendar year shall not exceed $100,000.
9. Stock Appreciation Rights. A Stock Appreciation Right shall, upon its
exercise, entitle the Participant to whom such Stock Appreciation Right was
granted to receive a number of Shares or cash or combination thereof, as the
Committee in its discretion shall determine, the aggregate value of which (i.e.,
the sum of the amount of cash and/or Market Value of such Shares on date of
exercise) shall equal (as nearly as possible, it being understood that the
Corporation shall not issue any fractional shares) the amount by which the
Market Value per Share on the date of such exercise shall exceed the Exercise
Price of such Stock Appreciation Right, multiplied by the number of Shares with
respect of which such Stock Appreciation Right shall have been exercised. A
Stock Appreciation Right may be Related to an Option or may be granted
independently of any Option as the Committee shall from time to time in each
case determine. At the time of grant of an Option the Committee shall determine
whether and to what extent a Related Stock Appreciation Right shall be granted
with respect thereto; provided, however, and notwithstanding any other provision
of the Plan, that if the Related Option is an Incentive Stock Option, the
Related Stock Appreciation Right shall satisfy all the restrictions and
limitations of Section 8 hereof as if such Related Stock Appreciation Right were
an Incentive Stock Option and as if other rights which are Related to In centive
Stock Options were Incentive Stock Options. In the case of a Related Option,
such Related Option shall cease to be exercisable to the extent of the Shares
with respect to which the Related Stock Appreciation Right was exercised. Upon
the exercise or termination of a Related Option, any Related Stock Appreciation
Right shall terminate to the extent of the Shares with respect to which the
Related Option was exercised or terminated.
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10. Limited Stock Appreciation Rights. At the time of grant of an Option
or Stock Appreciation Right to any Participant, the Committee shall have full
and complete authority and discretion to also grant to such Participant a
Limited Stock Appreciation Right which is Related to such Option or Stock
Appreciation Right; provided, however and notwithstanding any other provision of
the Plan, that if the Related Option is an Incentive Stock Option, the Related
Limited Stock Appreciation Right shall satisfy all the restrictions and
limitations of Section 8 hereof as if such Related Limited Stock Appreciation
Right were an Incentive Stock Option and as if all other Rights which are
Related to Incentive Stock Options were Incentive Stock Options. Notwithstanding
any other provision of the Plan, a Limited Stock Appreciation Right shall be
exercisable only during the period beginning on the first day following the date
of expiration of any "offer" (as such term is hereinafter defined) and ending on
the forty-fifth day following such date.
A Limited Stock Appreciation Right shall, upon its exercise, entitle the
Participant to whom such Limited Stock Appreciation Right was granted to receive
an amount of cash equal to the amount by which the "Offer Price per Share" (as
such term is hereinafter defined) or the Market Value on the date of such
exercise, as shall have been provided by the Committee in its discretion at the
time of grant, shall exceed the Exercise Price of such Limited Stock
Appreciation Right, multiplied by the number of Shares with respect to which
such Limited Stock Appreciation Right shall have been exercised. Upon the
exercise of a Limited Stock Appreciation Right, any Related Option and/or
Related Stock Appreciation Right shall cease to be exercisable to the extent of
the Shares with respect to which such Limited Stock Appreciation Right was
exercised. Upon the exercise or termination of a Related Option or Related Stock
Appreciation Right, any Related Li mited Stock Appreciation Right shall
terminate to the extent of the Shares with respect to which such Related Option
or Related Stock Appreciation Right was exercised or terminated.
For the purposes of this Section 10, the term "Offer" shall mean any tender
offer or exchange offer for Shares other than one made by the Corporation,
provided that the corporation, person or other entity making the offer acquires
pursuant to such offer either (i) 25% of the Shares outstanding immediately
prior to the commencement of such offer or (ii) a number of Shares which,
together with all other Shares acquired in any tender offer or exchange offer
(other than one made by the Corporation) which expired within sixty days of the
expiration date of the offer in question, equals 25% of the Shares outstanding
immediately prior to the commencement of the offer in question. The term "Offer
Price per Share" as used in this Section 10 shall mean the highest price per
Share paid in any Offer which Offer is in effect any time during the period
beginning on the sixtieth day prior to the date on which a Limited Stock
Appreciation Right is exercised and ending on the date on which such Limited
Stock Appreciation Right is exercised. Any securities or property which are part
or all of the consideration paid for Shares in the Offer shall be valued in
determining the Offer Price per Share at the higher of (A) the valuation placed
on such securities or property by the corporation, person or other entity making
such Offer or (B) the valuation placed on such securities or property by the
Committee.
11. Adjustments Upon Changes in Capitalization. In the event of any change
in the outstanding Shares subsequent to the effective date of the Plan by reason
of any reorganization, re capitalization, stock split, stock dividend, cash
distribution in excess of normal dividend levels, combination or exchange of
Shares, merger, consolidation or any change in the corporate structure
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or Shares of the Corporation, the maximum aggregate number, class and Exercise
Price of shares as to which Awards may be granted under the Plan and the number
and class of Shares with respect to which Awards theretofore have been granted
under the Plan shall be appropriately adjusted by the Committee, whose
determination shall be conclusive.
12. Effect of Merger. In the event of any merger, consolidation or
combination of the Corporation (other than a merger, consolidation or
combination in which the Corporation is the continuing entity and which does not
result in the outstanding Shares being converted into or exchanged for different
securities, cash or other property, or any combination thereof) pursuant to a
plan or agreement the terms of which are binding upon all stockholders of the
Corporation (except to the extent that dissenting stockholders may be entitled,
under statutory provisions or provisions contained in the certificate of
incorporation, to receive the appraised or fair value of their holdings), any
Participant to whom an Option or Right has been granted shall have the right
(subject to the pro visions of the Plan and any limitation applicable to such
Option or Right), thereafter and during the term of each such Option or Right,
to receive upon exercise of any such Option or Right an amount equal to the
excess of the fair market value on the date of such exercise of the securities,
cash or other property, or combination thereof, receivable upon such merger,
consolidation or combination in respect of a Share over the Exercise Price of
such Right or Option, multiplied by the number of Shares with respect to which
such Option or Right shall have been exercised. Such amount may be payable fully
in cash, fully in one or more of the kind or kinds of property payable in such
merger, consolidation or combination, or partly in cash and partly in one or
more of such kind or kinds of property, all in the discretion of the Committee.
13. Effect of Change in Control. Each of the events specified in the
following clauses (i) through (iii) of this Section 13 shall be deemed a "change
of control": (i) any third person, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended, shall become the
beneficial owner of shares of the Corporation with respect to which 25% or more
of the total number of votes for the election of the Board of Directors of the
Corporation may be cast, (ii) as a result of, or in connection with, any cash
tender offer, merger or other business combination, sale of assets or contested
election, or combination of the foregoing, the persons who were directors of the
Corporation shall cease to constitute a majority of the Board of Directors of
the Corporation, or (iii) the stockholders of the Corporation shall approve an
agreement providing either for a transaction in which the Corporation will cease
to be an independent publicly-owned corporation or for a sale or other
disposition of all or substantially all the assets of the Corporation. Upon a
change in control, unless the Committee shall have otherwise provided in the
applicable Option Agreement, all Options and Stock Appreciation rights
theretofore granted and not fully exercisable shall become exercisable in
accordance with their terms; provided, however, that no Option or Stock
Appreciation Right which has previously been exercised or otherwise terminated
shall become exercisable.
14. Assignments and Transfers. No Award nor any right or interest of a
Participant under the Plan in any instrument evidencing any Award under the Plan
may be assigned, encumbered or transferred except, in the event of the death of
a Participant, by will or the laws of descent and distribution or in the case of
Awards other than Incentive Stock Options pursuant to a qualified domestic
relations order, as defined in the Code or Title I of ERISA or the rules
thereunder.
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15. Employee Rights Under the Plan. No director, advisory director,
director emeritus, officer or employee shall have a right to be selected as a
Participant nor, having been so selected, to be selected again as a Participant
and no director, advisory director, director emeritus, officer, employee or
other person shall have any claim or right to be granted an Award under the Plan
or under any other incentive or similar plan of the Corporation or any
Affiliate. Neither the Plan nor any action taken thereunder shall be construed
as giving any Employee any right to be retained in the employ of the Corporation
or any Affiliate.
16. Delivery and Registration of Stock. The Corporation's obligation to
deliver Shares with respect to an Award shall, if the Committee so requests, be
conditioned upon the receipt of a representation as to the investment intention
of the Participant to whom such Shares are to be delivered, in such form as the
Committee shall determine to be necessary or advisable to comply with the
provisions of the Securities Act of 1933 or any other Federal, state or local
securities legislation or regulation. It may be provided that any representation
requirement shall become inoperative upon a registration of the Shares or other
action eliminating the necessity of such representation under such Securities
Act or other securities legislation. The Corporation shall not be required to
deliver any Shares under the Plan prior to (i) the admission of such Shares to
listing on any stock exchange on which Shares may then be listed, and (ii) the
completion of such regis tration or other qualification of such Shares under any
state or Federal law, rule or regulation, as the Committee shall determine to be
necessary or advisable.
This Plan is intended to comply with Rule 16b-3 under the Securities
Exchange Act of 1934. Any provision of the Plan which is inconsistent with said
Rule shall, to the extent of such inconsistency, be inoperative and shall not
affect the validity of the remaining provisions of the Plan.
17. Withholding Tax. The Corporation shall have the right to deduct from
all amounts paid in cash with respect to the exercise of a Right under the Plan
any taxes required by law to be withheld with respect to such cash payments.
Where a Participant or other person is entitled to receive Shares pursuant to
the exercise of an Option or Right pursuant to the Plan, the Corporation shall
have the right to require the Participant or such other person to pay the
Corporation the amount of any taxes which the Corporation is required to
withhold with respect to such Shares, and may, in its sole discretion, withhold
sufficient Shares to cover the amount of taxes which the Corporation is required
to withhold. No discretion or choice shall be conferred upon any Participant
with respect to the form, timing or method of any such tax withholding.
18. Amendment or Termination. The Board of Directors of the Corporation may
amend, suspend or terminate the Plan or any portion thereof at any time, but no
amendment shall be made without approval of the stockholders of the Corporation
which shall (i) materially increase the aggregate number of Shares with respect
to which Awards may be made under the Plan, (ii) materially increase the
aggregate number of Shares which may be subject to Awards to Participants who
are not Employees, or (iii) change the class of persons eligible to participate
in the Plan; provided, however, that no such amendment, suspension or
termination shall impair the rights of any Participant, without his consent, in
any Award theretofore made pursuant to the Plan.
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19. Effective Date and Term of Plan. The Plan shall become effective upon
its ratification by stockholders of the Corporation. It shall continue in effect
for a term of ten years unless sooner terminated under Section 18 hereof.
20. Initial Grants. By, and simultaneously with, ratification of this Plan
by the Corporation's stockholders, each member of the Board of Directors of the
Corporation at the time of the stockholders ratification of the Plan who is not
an Employee, is hereby granted a ten year, NonQualified Stock Option to purchase
5,058 Shares of the Corporation's common stock at an Exercise Price per Share
equal to the Market Value of the Corporation's common stock on the date of grant
of the Option. Each such Option shall be evidenced by a Non-Qualified Stock
Option agreement in a form approved by the Board of Directors of the Corporation
and shall be subject in all respects to the terms and conditions of this Plan,
which are controlling.
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EXHIBIT B
WYMAN PARK BANCORPORATION, INC.
RECOGNITION AND RETENTION PLAN
1. Plan Purpose. The purpose of the Plan is to promote the long-term
interests of the Corporation and its stockholders by providing a means for
attracting and retaining directors, officers and employees of the Corporation
and its Affiliates.
2. Definitions. The following definitions are applicable to the Plan:
"Affiliate" - means any "parent corporation" or "subsidiary corporation" of
the Corporation, as such terms are defined in Section 424(e) and (f),
respectively, of the Code.
"Association" - means Wyman Park Federal Savings & Loan Association, a
savings institution and its successors.
"Award" - means the grant of Restricted Stock pursuant to the terms of
Section 13 of the Plan or by the Committee, as provided in the Plan.
"Beneficiary" - means the person or persons designated by a Participant to
receive any benefits payable under the Plan in the event of such Participant's
death. Such person or persons shall be designated in writing on forms provided
for this purpose by the Committee and may be changed from time to time by
similar written notice to the Committee. In the absence of a written
designation, the Beneficiary shall be the Participant's surviving spouse, if
any, or if none, his estate.
"Code" - means the Internal Revenue Code of 1986, as amended.
"Committee" - means the Committee of the Board of Directors of the
Corporation referred to in Section 7 hereof.
"Continuous Service" - means the absence of any interruption or termination
of service as a director, advisory director, director emeritus, officer or
employee of the Corporation or any Affiliate. Service shall not be considered
interrupted in the case of sick leave, military leave or any other leave of
absence approved by the Corporation or any Affiliate or in the case of transfers
between payroll locations of the Corporation or between the Corporation, its
Affiliates or its successor. With respect to any advisory director or director
emeritus, continuous service shall mean the availability to perform such
functions as may be required of such individuals.
"Corporation" - means Wyman Park Bancorporation, Inc.
"Disability" - means any physical or mental impairment which qualifies a
director, advisory director, director emeritus, officer or employee for
disability benefits under any
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applicable long-term disability plan maintained by the Association or an
Affiliate, or, if no such plan applies, which renders such employee or director,
in the judgment of the Committee, unable to perform his customary duties and
responsibilities.
"Early Retirement" -- means retirement from employment with or as a
director, advisory director, or emeritus director of the Corporation prior to
the Participant either (i) having reached the age of 62 or (ii) having
maintained Continuous Service for at least three years.
"ERISA" - means the Employee Retirement Income Security Act of 1974, as
amended.
"Non-Employee Director" - means a director who (a) is not currently an
officer or employee of the Corporation; (b) is not a former employee of the
Corporation who receives compensation for prior services (other than from a
tax-qualified retirement plan); (c) has not been an officer of the Corporation;
(d) does not receive renumeration rom the Corporation in any capacity other than
as a director; and (e) does not possess an interest in any other transactions or
is not engaged in a business relationship for which disclosure would be required
under Item 404(a) or (b) of Regulation S-K.
"Normal Retirement" -- means retirement from employment with or as a
director, advisory director, or emeritus director of the Corporation after the
Participant has (i) reached the age of 65 and (ii) maintained Continuous Service
for at least three years.
"Participant" - means any director, advisory director, director emeritus,
officer or employee of the Corporation or any Affiliate who is selected by the
Committee to receive an Award or is granted an Award.
"Plan" - means the Recognition and Retention Plan of the Corporation.
"Restricted Period" - means the period of time selected by the Committee
for the purpose of determining when restrictions are in effect under Section 3
hereof with respect to Restricted Stock awarded under the Plan.
"Restricted Stock" - means Shares which have been contingently awarded to a
Participant by the Committee subject to the restrictions referred to in Section
3 hereof, so long as such restrictions are in effect.
"Shares" - means the common stock, par value $0.01 per share, of the
Corporation.
3. Terms and Conditions of Restricted Stock. The Committee referred to in
Section 7 hereof shall have full and complete authority, subject to the
limitations of the Plan, to grant Awards and, in addition to the terms and
conditions contained in paragraphs (a) through (f) of this Section 3, to provide
such other terms and conditions (which need not be identical among Participants)
in respect of such Awards, and the vesting thereof, as the Committee shall
determine.
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(a) At the time of an Award, the Committee shall establish for each Participant
a Restricted Period during which or at the expiration of which, as the
Committee shall determine and provide in the agreement referred to in
paragraph (d) of this Section 3, the Shares awarded as Restricted Stock
shall vest, and subject to any such other terms and conditions as the
Committee shall provide, Shares of Restricted Stock may not be sold,
assigned, transferred, pledged, voted or otherwise encumbered by the
Participant, except as hereinafter provided, during the Restricted Period.
Except for such restrictions, and subject to paragraphs (d) and (e) of this
Section 3 and Section 4 hereof, the Participant as owner of such Shares
shall have all the rights of a stockholder. The Committee shall have the
authority, in its discretion, to accelerate the time at which any or all of
the restrictions shall lapse with respect to an Award, or to remove any or
all of such restrictions, whenever it may determine that such action is
appropriate by reason of changes in applicable tax or other laws or other
changes in circumstances occurring after the commencement of such
Restricted Period.
(b) Except as provided in Section 5 hereof, if a Participant ceases to maintain
Continuous Service for any reason (other than death, Disability, Normal
Retirement, or Early Retirement), unless the Committee shall otherwise
determine, all Shares of Restricted Stock theretofore awarded to such
Participant and which at the time of such termination of Continuous Service
are subject to the restrictions imposed by paragraph (a) of this Section 3
shall upon such termination of Continuous Service be forfeited and returned
to the Corporation. If a Participant ceases to maintain Continuous Service
by reason of death, Disability, Normal Retirement, or Early Retirement,
Restricted Stock then still subject to restrictions imposed by paragraph
(a) of this Section 3 will be free of those restrictions as of the day
prior to such death, Disability, Normal Retirement, or Early Retirement.
(c) Each certificate in respect of Shares of Restricted Stock awarded under the
Plan shall be registered in the name of the Participant and deposited by
the Participant, together with a stock power endorsed in blank, with the
Corporation and shall bear the following (or a similar) legend:
The transferability of this certificate and the shares of stock
represented hereby are subject to the terms and conditions (including
forfeiture) contained in the Recognition and Retention Plan of Wyman Park
Bancorporation, Inc. Copies of such Plan are on file in the offices of the
Secretary of Wyman Park Bancorporation, Inc., 11 West Ridgely Road,
Lutherville, Maryland 21093.
(d) At the time of the granting of any Award, the Participant shall enter into
an Agreement with the Corporation in a form specified by the Committee,
agreeing to the terms and conditions of the Award and such other matters as
the Committee, in its sole discretion, shall determine (the "Restricted
Stock Agreement").
(e) At the time of an Award, the Committee may, in its discretion, determine
that the payment to the Participant of dividends declared or paid by the
Corporation on any Restricted Stock shall be deferred until the earlier to
occur of (i) the lapsing of the restrictions imposed
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under paragraph (a) of this Section 3 or (ii) the forfeiture of such Shares
under paragraph (b) of this Section 3, and shall instead be held by the
Corporation for the account of the Participant until such time. In the
event of such deferral, there shall be credited at the end of each year (or
portion thereof) interest on the amount of the Participant's account at the
beginning of the year at a rate per annum as the Committee, in its
discretion, may determine. Payment of deferred dividends to the
Participant, together with interest accrued thereon, shall be made upon the
earlier to occur of the events specified in (i) and (ii) of the immediately
preceding sentence.
(f) At the lapsing of the restrictions imposed by paragraph (a) of this Section
3, the Corporation shall redeliver to the Participant (or where the
relevant provision of paragraph (b) of this Section 3 applies in the case
of a deceased Participant, to his legal representative, Beneficiary or
heir) the certificate(s) and stock power deposited with it pursuant to
paragraph (c) of this Section 3 and the Shares represented by such
certificate(s) shall be free of the restrictions referred to in paragraph
(a) of this Section 3.
4. Adjustments Upon Changes in Capitalization. In the event of any change
in the outstanding Shares subsequent to the effective date of the Plan by reason
of any reorganization, recapitalization, stock split, stock dividend,
combination or exchange of shares, merger, consolidation or any change in the
corporate structure or shares of the Corporation, the maximum aggregate number
and class of Shares as to which Awards may be granted under the Plan and the
number and class of Shares with respect to which Awards theretofore have been
granted under the Plan shall be appropriately adjusted by the Committee, whose
determination shall be conclusive. Any shares of stock or other securities
received, as a result of any of the foregoing, by a Participant with respect to
Restricted Stock shall be subject to the same restrictions and the
certificate(s) or other instruments representing or evidencing such shares or
securities shall be legended and deposited with the Corporation in the manner
provided in Section 3 hereof.
5. Effect of Change in Control. Each of the events specified in the
following clauses (i) through (iii) of this Section 5 shall be deemed a "change
of control": (i) any third person, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended, shall become the
beneficial owner of shares of the Corporation with respect to which 25% or more
of the total number of votes for the election of the Board of Directors of the
Corporation may be cast, (ii) as a result of, or in connection with, any cash
tender offer, merger or other business combination, sale of assets or contested
election, or combination of the foregoing, the persons who were directors of the
Corporation shall cease to constitute a majority of the Board of Directors of
the Corporation, or (iii) the stockholders of the Corporation shall approve an
agreement providing either for a transaction in which the Corporation will cease
to be an independent publicly-owned corporation or for a sale or other
disposition of all or substantially all of the assets of the Corporation. Upon a
change in control, unless the Committee shall have otherwise provided in the
applicable Restricted Stock Agreement, any Restricted Period with respect to
Restricted Stock theretofore awarded to such participant shall lapse upon the
happening of such event and all Shares awarded as Restricted Stock shall become
fully vested in the Participant to whom such Shares were awarded.
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6. Assignments and Transfers. During the Restricted Period, no Award nor
any right or interest of a Participant under the Plan in any instrument
evidencing any Award under the Plan may be assigned, encumbered or transferred
except (i) in the event of the death of a Participant, by will or the laws of
descent and distribution, or (ii) pursuant to a qualified domestic relations
order as defined in the Code or Title I of ERISA or the rules thereunder.
7. Administration. The Plan shall be administered by a Committee consisting
of two or more members, each of whom shall be a Non-Employee Director. The
members of the Committee shall be appointed by the Board of Directors of the
Corporation. Except as limited by the express provisions of the Plan, the
Committee shall have sole and complete authority and discretion to: (i) select
Participants and grant Awards; (ii) determine the number of Shares to be subject
to types of Awards generally, as well as individual Awards granted under the
Plan; (iii) determine the terms and conditions upon which Awards shall be
granted under the Plan; (iv) prescribe the form and terms of instruments
evidencing such grants; and (v) establish from time to time regulations for the
administration of the Plan, interpret the Plan, and make all determinations
deemed necessary or advisable for the administration of the Plan.
A majority of the Committee shall constitute a quorum, and the acts of a
majority of the members present at any meeting at which a quorum is present, or
acts approved in writing by a majority of the Committee without a meeting, shall
be acts of the Committee.
8. Shares Subject to Plan and Delivery and Registration of Stock. Subject
to adjustment by the operation of Section 4 hereof, the maximum number of Shares
with respect to which Awards may be made under the Plan is 40,468 Shares of the
Corporation. The Shares with respect to which Awards may be made under the Plan
may be either authorized and unissued Shares or issued Shares heretofore or
hereafter reacquired and held as treasury Shares. An Award shall not be
considered to have been made under the Plan with respect to Restricted Stock
which is forfeited and new Awards may be granted under the Plan with respect to
the number of Shares as to which such forfeiture has occurred.
The Corporation's obligation to deliver Shares with respect to an Award
shall, if the Committee so requests, be conditioned upon the receipt of a
representation as to the investment intention of the Participant to whom such
Shares are to be delivered, in such form as the Committee shall determine to be
necessary or advisable to comply with the provisions of the Securities Act of
1933 or any other Federal, state or local securities legislation or regulation.
It may be provided that any representation requirement shall become inoperative
upon a registration of the Shares or other action eliminating the necessity of
such representation under such Securities Act or other securities legislation.
The Corporation shall not be required to deliver any Shares under the Plan prior
to (i) the admission of such shares to listing on any stock exchange on which
Shares may then be listed, and (ii) the completion of such registration or other
qualification of such Shares under any state or Federal law, rule or regulation,
as the Committee shall determine to be necessary or advisable.
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This Plan is intended to comply with Rule 16b-3 under the Securities
Exchange Act of 1934. Any provision of the Plan which is inconsistent with said
Rule shall, to the extent of such inconsistency, be inoperative and shall not
affect the validity of the remaining provisions of the Plan.
9. Employee Rights Under the Plan. No director, advisory director, director
emeritus, officer or employee shall have a right to be selected as a Participant
nor, having been so selected, to be selected again as a Participant and no
director, advisory director, director emeritus officer, employee or other person
shall have any claim or right to be granted an Award under the Plan or under any
other incentive or similar plan of the Corporation or any Affiliate. Neither the
Plan nor any action taken thereunder shall be construed as giving any officer or
employee any right to be retained in the employ of the Corporation, the
Association or any Affiliate.
10. Withholding Tax. Upon the termination of the Restricted Period with
respect to any shares of Restricted Stock (or at any such earlier time, if any,
that an election is made by the Participant under Section 83(b) of the Code, or
any successor provision thereto, to include the value of such Shares in taxable
income), the Corporation may withhold from any payment or distribution made
under this Plan sufficient Shares or may withhold or cause to be paid by the
Participant sufficient cash to cover any applicable withholding and employment
taxes. The Corporation shall have the right to deduct from all dividends paid
with respect to Shares of Restricted Stock the amount of any taxes which the
Corporation is required to withhold with respect to such dividend payments. No
discretion or choice shall be conferred upon any Participant with respect to the
form, timing or method of any such tax withholding.
11. Amendment or Termination. The Board of Directors of the Corporation may
amend, suspend or terminate the Plan or any portion thereof at any time;
provided, however, that no such amendment, suspension or termination shall
impair the rights of any Participant, without his consent, in any Award
theretofore made pursuant to the Plan.
12. Effective Date and Term of Plan. The Plan shall become effective upon
its ratification by the stockholders of the Corporation. It shall continue in
effect for a term of ten years unless sooner terminated under Section 10 hereof.
13. Initial Grants. By, and simultaneously with, the ratification of the
Plan by the Corporation's stockholders, each member of the Board of Directors of
the Corporation who is not a full-time Employee, is hereby granted an Award
equal to 2,023 Shares of the Corporation's common stock. Each such Award shall
be evidenced by a Restricted Stock Agreement in a form approved by the Committee
administering this Plan and shall be subject in all respects to the terms and
conditions of this Plan, which are controlling. The Awards will vest in five
equal installments, with the first installment vesting immediately upon the
ratification of the Plan by the Corporation's stockholders and each additional
installment vesting after the end of the subsequent calendar years, as long as
the director maintains Continuous Service with the Corporation or its
Affiliates.
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REVOCABLE PROXY REVOCABLE PROXY
Wyman Park Bancorporation, Inc.
SPECIAL MEETING OF STOCKHOLDERS
January 20, 1999
The undersigned hereby appoints the Board of Directors of Wyman Park
Bancorporation, Inc. (the "Company"), with full powers of substitution, to act
as attorneys and proxies for the undersigned to vote all shares of capital stock
of the Company which the undersigned is entitled to vote at the Special Meeting
of Stockholders (the "Meeting") to be held at the main office of the Company
located at 11 West Ridgely Road, Lutherville, Maryland on January 20, 1999 at
3:00pm and at any and all adjournments and postponements thereof.
1. The ratification of the adoption of the Company's 1999 Stock Option and
Incentive Plan.
[_] FOR [_] AGAINST [_] ABSTAIN
II. The ratification of the adoption of the Company's Recognition and Retention
Plan.
[_] FOR [_] AGAINST [_] ABSTAIN
In their discretion, the proxies are authorized to vote on any other
business that may properly come before the Meeting or any adjournment or
postponement thereof.
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THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR EACH OF THE PROPOSALS LISTED ABOVE. IF ANY OTHER
BUSINESS IS PRESENTED AT THE MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN
THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS
KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
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The Board of Directors recommends a vote "FOR" each of the proposals listed
above.
(Continued and to be SIGNED on Reverse Side)
<PAGE>
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
Should the undersigned be present and choose to vote at the Meeting or at
any adjournment or postponements thereof, and after notification to the
Secretary of the Company at the Meeting of the stockholder's decision to
terminate this proxy, the power of such attorneys or proxies shall be deemed
terminated and of no further force and effect. This proxy may also be revoked by
filing a written notice of revocation with the Secretary of the Company or by
duly executing a proxy bearing a later date.
The undersigned acknowledges receipt from the Company, prior to the
execution of this proxy, of notice of the Meeting and a proxy statement.
Dated:__________________________ ___________________________________
Signature of Stockholder
___________________________________
Signature of Stockholder
Please sign exactly as your name(s)
appear(s) on this card. When signing
as attorney, executor,
administrator, trustee or guardian,
please give your full title. If
shares are held jointly, each holder
should sign.
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PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE
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