As filed with the Securities and Exchange Commission on June 25,
1998.
Registration No. 333-_________
_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
___________________________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
___________________________
MAIN STREET BANCORP, INC.
(Exact Name of Registrant as Specified in its Charter)
Pennsylvania 23-2960905
(State of Incorporation) (I.R.S. Employer Identification No.)
P.O. Box 1097
601 Penn Street
Reading, Pennsylvania 19603
(610) 685-1400
(Address and Telephone Number of Principal Executive Offices)
___________________________
Nelson R. Oswald Jeffrey P. Waldron, Esquire
Chairman and Chief Stevens & Lee
Executive Officer One Glenhardie Corporate Center
Main Street Bancorp, Inc. 1275 Drummers Lane
P.O. Box 1097 Wayne, Pennsylvania 19087
601 Penn Street (610) 293-4961
Reading, Pennsylvania 19603
(610) 685-1400
(Names, Addresses and Telephone Numbers of Agents for Service)
Approximate date of commencement of proposed sale to the
public: As soon as practicable after this Registration Statement
becomes effective.
If the only securities being registered on this form are
being offered pursuant to dividend or interest reinvestment
plans, please check the following box. [X]
<PAGE 1>
If any of the securities being registered on this Form are
to be offered on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act of 1933 other than securities
offered only in connection with dividend or interest reinvestment
plans, check the following box. [ ]
__________________________
CALCULATION OF REGISTRATION FEE
_________________________________________________________________
Title of each Proposed Amount
class of maximum of
securities Amount offering aggregate Regis-
to be to be price per offering tration
registered registered unit(1) price Fee
_________________________________________________________________
Common Stock 5,000,000 $21.625 $108,125,000 $32,766
_________________________________________________________________
(1) Estimated solely for the purposes of calculating the
registration fee based upon the closing price of Main Street
Bancorp, Inc. common stock on June 23, 1998.
__________________
PAGE 2
<PAGE>
PROSPECTUS
MAIN STREET BANCORP, INC.
___________________________
SHAREHOLDER AUTOMATIC DIVIDEND REINVESTMENT AND
STOCK PURCHASE PLAN
___________________________
No person has been authorized to give any information or to make
any representation not contained in this Prospectus, and, if
given or made, such information or representation must not be
relied upon as having been authorized by Main Street Bancorp,
Inc. (the "Company"). Neither the delivery of this Prospectus
nor any sale made hereunder shall, under any circumstances,
create any implication that there has been no change in the
affairs of Company since the date hereof. This Prospectus does
not constitute an offer to sell, or a solicitation of an offer to
buy, any of the securities offered hereby in any jurisdiction to
any person to whom it is unlawful to make such offer in such
jurisdiction.
___________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS
THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
___________________________
5,000,000 authorized and unissued shares of the Company's
common stock ($1.00 par value) have been authorized for purchase
under the Shareholder Automatic Dividend Reinvestment and Stock
Purchase Plan. It is suggested that this Prospectus be retained
for future reference.
___________________________
The date of this Prospectus is June 25, 1998.
PAGE 3
<PAGE>
AVAILABLE INFORMATION
Main Street Bancorp, Inc. (the "Company") is subject to
the information requirements of the Securities Exchange Act of
1934, as amended ("Exchange Act") and, in accordance therewith,
files reports, proxy statements and other information with the
Securities and Exchange Commission ("Commission"). Such reports,
proxy statements and other information can be inspected and
copied at the public reference facilities of the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549,
and should be available for inspection and copying at the
following regional offices of the Commission: New York Regional
Office, 7 World Trade Center, Suite 1300, New York, New York
10048; and the Chicago Regional Office, Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Copies of such material can be obtained at prescribed
rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. The Company's
principal executive offices are located at 601 Penn Street,
Reading, Pennsylvania 19603 and its telephone number is (610)
685-1400. The Registration Statement also is available through
the Commissions's World Wide Web site on the Internet
(http:/www.sec.gov).
The Company has filed with the Commission in
Washington, D.C. a Registration Statement under the Securities
Act of 1933, as amended, with respect to the Common Stock offered
pursuant to this Prospectus. This Prospectus does not contain
all the information set forth in the Registration Statement,
certain portions of which have been omitted as permitted by the
rules and regulations of the Commission. In addition, certain
documents filed by Main Street Bancorp, Inc. with the Commission
have been incorporated in this Prospectus by reference. See
"Incorporation of Certain Documents by Reference." For further
information with respect to the Company and the Common Stock
offered hereby, reference is made to the Registration Statement,
including the exhibits thereto, and the documents incorporated
herein by reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the
Commission are incorporated herein by reference:
(a) Current Report on Form 8-K of the Company filed on
May 15, 1998, as amended on June 25, 1998, pursuant to
Section 13(a) or 15(d) or the Securities Exchange Act of 1934, as
amended (the "Exchange Act").
(b) All other reports filed by the Company pursuant to
Section 13(a) or 15(d) of the Exchange Act since April 29, 1998.
(c) The description of the Company's common stock, par
value $1.00 per share (the "Common Stock"), contained in the
<PAGE 4> Company's Registration Statement on Form 8-A filed with
the Commission on April 30, 1998, and as amended on May 8, 1998.
All documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act, prior to the termination of the offering of Common Stock
covered by this Prospectus, shall be deemed to be incorporated by
reference into this Prospectus and to be a part hereof from the
date of the filing of such documents. Any statement contained in
a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person
to whom this Prospectus is delivered, on the written or oral
request of any such person, a copy of any or all documents
incorporated herein by reference (other than exhibits to such
documents). Requests should be directed to:
Main Street Bancorp, Inc.
P.O. Box 1097
601 Penn Street
Reading, Pennsylvania 19603
Attention: Investor Relations
Telephone requests may be directed to the Company at
(610) 685-1400.
PAGE 5
<PAGE>
THE SHAREHOLDER AUTOMATIC DIVIDEND REINVESTMENT AND
STOCK PURCHASE PLAN
The following, in a question and answer format, are the
provisions of the Company's Shareholder Automatic Dividend
Reinvestment and Stock Purchase Plan (the "Plan"). Those holders
of the Common stock who do not participate in the Plan will
continue to receive cash dividend payments by check, if and when
dividends are declared.
Purpose
1. What is the purpose of the Plan?
The purpose of the Plan is to provide holders of one
(1) or more shares of the Company's common stock, par value $1.00
per share (the "Common Stock"), with an attractive and convenient
method of investing cash dividends and, from time to time, as the
Board of Directors of the Company may in its discretion
determine, voluntary cash payments, in shares of Common Stock.
To the extent the shares are purchased directly from the Company,
the Company will receive additional funds to be used for general
corporate purposes (see "Use of Proceeds").
The Plan offers eligible holders of Common Stock an
opportunity to invest conveniently for long-term growth. The
Plan is not intended to provide short-term holders of shares with
the means to acquire additional shares at a discount from market
price or to provide holders of shares with the means to generate
short-term profits through resale of shares acquired at a
discount from market price. The intended purpose of the Plan
precludes any person, organization or other entity from
establishing a series of related accounts for the purpose of
conducting arbitrage operations or exceeding the voluntary cash
payment limit. The Company accordingly reserves the right to
modify, suspend or terminate participation by a shareholder who
the Company determines is using the Plan for purposes
inconsistent with the intended purpose of the Plan.
Advantages
2. What are the advantages of the Plan?
- Participants may purchase Common Stock with reinvested
dividends at a 5% discount from the average price of
the Common Stock (see No. 11 below).
- Participants may, from time to time, as the Board of
Directors of the Company may in its discretion
determine, purchase Common Stock with voluntary cash
payments at the average price of the Common Stock (see
No. 11 below).
<PAGE 6>
- Participants may reinvest dividends and invest
voluntary cash payments without brokerage commissions
or other charges (see No. 14 below).
- Participants will receive a detailed statement of
account transactions (see No. 18 below).
Administration
3. Who administers the Plan for Participants?
Heritage National Bank, a subsidiary of the Company,
administers the Plan as agent (the "Agent") for Participants, and
in such capacity sends statements of account to Participants and
performs other duties relating to the Plan. All correspondence
relating to the Plan should include your account number and
should be directed to:
Heritage National Bank
120 South Centre Avenue
P.O. Box 1100
Pottsville, Pennsylvania 17901
Attention: Dividend Reinvestment Department
Telephone requests may be directed to the Agent at
1-717-622-2320.
Participation
4. Who is eligible to participate?
All record holders of one (1) or more shares of Common
Stock are eligible to participate in the Plan. If you hold your
shares in your own name, you may participate in the Plan. If you
are a beneficial owner whose shares are registered in any name
other than your own (e.g., in a broker's "street name" or in the
name of a bank nominee), you must either make appropriate
arrangements for your broker or nominee to participate in the
Plan on your behalf or you must become a shareholder of record by
having those shares with respect to which you wish to participate
transferred into your own name.
5. How does an eligible shareholder become a Participant?
An eligible shareholder who is the record holder of
Common Stock may join the Plan at any time by completing and
signing the authorization form ("Authorization Form") included
with this Prospectus and returning it to the Agent. A
postage-paid envelope is provided for that purpose. An eligible
beneficial owner whose shares of Common Stock are registered in
the name of a broker or bank nominee must make arrangements to
have such broker or bank nominee submit an Authorization Form to
the Agent on such beneficial owner's behalf. Additional
Authorization Forms may be obtained from the Agent. <PAGE 7>
Authorization Forms for new Participants must be
received prior to a dividend record date for eligible
shareholders to reinvest the related dividend.
6. What if I participated in the Heritage Bancorp, Inc. or BCB
Financial Services Corporation dividend reinvestment plans?
The Company is the result of the consolidation of
Heritage Bancorp, Inc. ("Heritage") and BCB Financial Services
Corporation ("BCB"). Heritage and BCB each maintained a dividend
reinvestment plan. The Plan is a successor to the Heritage and
BCB plans and, as such, participants in these plans are
automatically enrolled in the Plan. Therefore, if you want to
continue participation in the Plan with respect to all shares
that participated in the Heritage or BCB plan you do not need to
take any further action.
7. Does a shareholder have to authorize dividend reinvestment
on a minimum number of shares?
Yes. An eligible shareholder must authorize the
reinvestment of dividends on at least one share of Common Stock.
8. May a Participant change the number of shares subject to the
Plan?
Yes. If a Participant wishes to change the number of
shares of Common Stock subject to the Plan, the Participant must
notify the Agent in writing to that effect. Any such
notification received after a dividend record date will not be
effective until dividends paid for such record date have been
reinvested and the shares credited to the Participant's account.
Purchases
9. What is the source for shares of Common Stock purchased
under the Plan?
Plan shares will be purchased, at the Company's
discretion, either directly from the Company or on the open
market, or by a combination of the foregoing. Shares purchased
from the Company will be authorized, but unissued shares of
Common Stock.
10. When and how will shares of Common Stock be purchased under
the Plan?
Dividends will be reinvested on the dividend payment
date.
Any voluntary cash payment received by the Agent prior
to the fifth (5th) day of a month will be applied to the purchase
of Common Stock on the tenth (10th) day of that month at a price
determined in accordance with the provisions of the Plan (the
"Purchase Date"). Any voluntary cash payment received after the
<PAGE 8> fifth (5th) day of a month will be applied to the
purchase of Common Stock on the tenth (10th) day of the following
month. No interest will be paid on voluntary cash payments.
Therefore, you should forward voluntary cash payments by the
Agent shortly before the fifth (5th) day of the month while
taking care to allow sufficient time to ensure that a voluntary
cash payment is received by that date. Your uninvested voluntary
cash payments will be returned to you upon request received by
the Agent by the third (3rd) day of the month.
11. At what price will shares of Common Stock be purchased under
the Plan?
The price of shares of Common Stock purchased with
reinvested cash dividends will be 95% of the average price. The
price of shares of Common Stock purchased with voluntary cash
payments, if any, will be 100% of the average price.
In the case of purchases from the Company of authorized
but unissued shares of Common Stock, the average price is
determined by averaging the high and low sale prices of the
Common Stock as reported on the NASDAQ Stock Market on the
relevant Purchase Date. In the case of purchases of shares of
Common Stock on the open market, the average price will be the
weighted average purchase price of shares purchased for the
relevant Purchase Date.
12. How many shares of Common Stock will be purchased for
Participants?
The number of shares that will be purchased for each
Participant will depend on the amount of dividends to be
reinvested, voluntary cash payments, or both in a Participant's
account and the applicable purchase price of the Common Stock
(see No. 11 above). Each Participant's account will be credited
with that number of shares, including any fractional interest
computed to four decimal places, equal to the total amount to be
invested divided by the applicable purchase price as described in
the response to Question No. 11 above.
13. Will dividends on shares held in a Participant's account be
used to purchase additional shares under the Plan?
Yes. All dividends on shares held in a Participant's
account, whether purchased through dividend reinvestment or
voluntary cash payments, will be automatically reinvested in
additional shares of Common Stock.
<PAGE 9>
14. Are there any expenses to Participants in connection with
purchases under the Plan?
No. Participants will incur no brokerage commissions
or other charges for purchases made under the Plan.
Voluntary Cash Payments
15. Who will be eligible to make voluntary cash payments?
All holders of one (1) or more shares of Common Stock
who elect to have dividends reinvested in accordance with
provisions of the Plan may, from time to time, as the Board of
Directors of the Company in its discretion determines, elect to
make voluntary cash payments. Participants will be permitted to
purchase shares of the Common Stock with voluntary cash payments
under the Plan on a monthly basis as described at No. 10 above.
16. What are the limitations on voluntary cash payments?
Voluntary cash payments may be made at any time in
integral multiples of $25. Such payments on behalf of any
Participant may not aggregate more than $3,000 per quarter.
Voluntary cash payments must be made in U.S. currency. The
Company reserves the right in its sole discretion to determine
whether voluntary cash payments are made on behalf of a
particular Participant.
17. How does the voluntary cash payment option work?
A voluntary cash payment may be made by forwarding a
check or money order to the Agent with a payment form which will
periodically be sent to Participants or their brokers or
nominees, as the case may be, with their statement of account.
Checks and money orders should be made payable to Main Street
Bancorp, Inc. and should include the Participant's account
number. Additional payment forms may be obtained from the Agent
(see No. 3 above).
Any voluntary cash payment received on or before one
day prior to an Investment Date (see No. 10 above) will be
applied to the purchase of shares of Common Stock on or for such
Investment Date at a price determined in accordance with
provisions of the Plan (see Nos. 11 and 12 above).
Reports to Participants
18. What kind of reports will be sent to Participants in the
Plan?
A statement of account transactions will be mailed to
each Participant within approximately thirty (30) days after the
Purchase Date (see No. 10 above). These statements will provide
a record of cost information and should be retained for tax
purposes. Each Participant will also receive copies of Company's
<PAGE 10> annual and quarterly reports to shareholders, proxy
statements and information for income tax reporting purposes.
Share Certificates
19. Will certificates be issued for shares of Common Stock
purchased under the Plan?
Unless requested by a Participant, certificates for
shares of Common Stock purchased under the Plan will not be
issued. The number of shares credited to a Participant's account
under the Plan will be shown on his statement of account. This
safekeeping feature protects against loss, theft or destruction
of stock certificates. Certificates will be issued for shares
withdrawn from the Plan (see No. 21 below).
As an additional service to Participants, Participants
may deposit free of charge with the Agent for safekeeping any
certificate for shares of Common Stock subject to reinvestment of
dividends under the Plan. Delivery of certificates for this
service is at the risk of the shareholder and, for delivery by
mail, insured registered mail with return receipt is recommended.
The receipt of any shares delivered for safekeeping will be shown
on your account statement.
20. In whose name will certificates be registered when issued to
Participants?
Unless the Participant otherwise directs, certificates
will be issued in the name in which the Participant's dividend
reinvestment account is maintained. If a Participant requests a
certificate to be issued in a name other than that of the account
registration, the request must bear his or her own signature. If
the account is registered in multiple names, all signatures must
appear on the request. In both cases, the signatures must be
guaranteed by an acceptable financial institution. Upon a
Participant's death, the Agent will follow the instructions of
the decedent's personal representative upon submission of
appropriate proof of authority.
Withdrawal of Shares in Plan Accounts
21. How may a Participant withdraw shares purchased under the
Plan?
A Participant may withdraw all or a portion of the
shares of Common Stock credited to his account by notifying the
Agent in writing to that effect and specifying in the notice the
number of shares to be withdrawn. This notice should be mailed
to the Agent at the address shown in response to Question No. 3
above. Certificates for whole shares of Common Stock so
withdrawn will be registered in the name of and issued to the
Participant (see No. 20 above). Any notice of withdrawal
received after the ex-dividend date for a dividend (normally
three days prior to the applicable dividend record date) will not
<PAGE 11> be effective until dividends paid for the applicable
record date have been reinvested and the shares credited to the
Participant's account. No dividends will be reinvested on shares
withdrawn from a Participant's account unless an Authorization
Form is or has been submitted with respect to such shares.
22. What happens to any fractional interest when a Participant
withdraws shares purchased under the Plan?
Any fractional interest withdrawn will be liquidated by
the Agent at the average of the high and low sale prices of the
Common Stock as reported on the NASDAQ Stock Market (see No. 11
above) on the date the withdrawal request is received by the
Agent and a check will be issued promptly for the proceeds
thereof. In no case will certificates representing a fractional
interest be issued.
Discontinuation of Dividend Reinvestment
23. How does a Participant discontinue participation under the
Plan?
A Participant may discontinue participation under the
Plan by notifying the Agent in writing to that effect (see No. 3
above). Any notice of discontinuation received after the ex-
dividend date for a dividend (normally three days prior to the
applicable dividend record date) will not be effective until
dividends paid for the applicable record date have been
reinvested and the shares credited to the Participant's account.
If a Participant discontinues participation in the Plan,
dividends on shares held in such Participant's account will be
automatically reinvested until such shares are withdrawn (see
No. 21 above). If, after discontinuation, less than one share
remains in such Participant's account, it shall be deemed that
the Participant has withdrawn from the Plan, and the Agent will
liquidate any fractional interest and mail the net proceeds to
such Participant in accordance with provisions of the Plan.
Federal Tax Information
24. What are the federal income tax consequences of
participation in the Plan?
Reinvestment Dividends. In the case of reinvested
dividends, when shares are acquired for a Participant's account
directly from the Company, the Participant must include in gross
income a dividend equal to the number of shares purchased with
reinvested dividends multiplied by the fair market value of the
Common Stock on the relevant dividend payment date. The
Participant's basis in such shares will also equal the fair
market value of the shares on the relevant dividend payment date.
Alternatively, when shares are purchased for a
Participant's account on the open market with reinvested
dividends, a Participant must include in gross income a dividend
<PAGE 12> equal to the actual price of the shares plus that
portion of any brokerage commissions paid by the Company which
are attributable to the purchase of the Participant's shares.
The Participant's basis in shares held for his or her account
will be equal to the purchase price for the shares plus allocable
brokerage commissions.
Optional Cash Payments. In the case of shares
purchased on the open market with optional cash payments,
Participants will be in receipt of a dividend to the extent of
any brokerage commissions paid by the Company. A Participant's
basis in shares acquired with optional cash payments will be
equal to the cost of the shares plus an allocable share of any
brokerage commissions.
Additional Information. The holding period for shares
acquired pursuant to the Plan will begin the day after the date
the shares are acquired. In the case of any shareholder as to
whom federal income tax withholding on dividends is required and
in the case of a foreign shareholder whose taxable income under
the Plan is subject to federal income tax withholding, the
Company will reinvest dividends net of the required amount of tax
withheld.
Participants should consult their own tax advisors as
to the tax consequences of account transactions. Certain tax
information will be provided to Participants by the Company (see
No. 18 above).
Other Information
25. What happens if the Company declares a stock dividend,
effects a stock split or has a rights offering with respect
to Common Stock?
Any shares resulting from a stock dividend or stock
split with respect to the Common Stock (whole shares and any
fractional interest) in a Participant's account will be credited
to such account. The basis for any rights offering will include
the shares of Common Stock and any fractional interest credited
to a Participant's account.
26. How will the shares credited to a Participant's account be
voted at a meeting of the shareholders?
If on a record date for a meeting of shareholders there
are shares credited to a Participant's account under the Plan,
such Participant will be sent proxy materials for such meeting.
A Participant will be entitled to one vote for each whole share
of Common Stock credited to his account. The Participant may
vote by proxy or in person at any such meeting.
<PAGE 13>
27. What is the responsibility of the Agent?
The Agent receives the Participants' dividend payments
and voluntary cash payments, invests such amounts in additional
shares of Common Stock, maintains continuing records of each
Participant's account, and advises Participants as to all
transactions in and the status of their accounts. The Agent acts
in the capacity of agent for the Participants.
All notices from the Agent to a Participant will be
addressed to the Participant at his last address of record with
the Agent. The mailing of a notice to a Participant's last
address of record will satisfy the Agent's duty of giving notice
to such Participant. Therefore, Participants must promptly
notify the Agent of any change of address.
The Agent, in administering the Plan, will not be
liable for any act done in good faith or for any good faith
omission to act, including, without limitation, any claim for
liability arising out of failure to terminate a Participant's
account upon such Participant's death prior to receipt of notice
in writing of such death or modifying, suspending or terminating
participation by a shareholder who the Company determines is
using the Plan for purposes inconsistent with the intended
purposes of the Plan. Neither the Agent nor the Company shall
have any duties, responsibilities or liabilities except such as
are expressly set forth in the Plan.
All transactions in connection with the Plan shall be
governed by the laws of the Commonwealth of Pennsylvania.
28. May the Plan be modified or discontinued?
The Company reserves the right to suspend or terminate
the Plan at any time. It also reserves the right to make
modifications to the Plan. Participants will receive prior
notice of any such suspension, termination or modification. In
addition, the Company and the Agent may adopt reasonable
procedures for the administration of the Plan.
29. May a Participant pledge shares purchased under the Plan?
No. A Participant who wishes to pledge shares credited
to his account must request the withdrawal of such shares in
accordance with the procedures outlined in response to Question
No. 21 above.
30. What procedures should be followed if a Participant wishes
to sell shares purchased under the Plan?
When a Participant wishes to sell all or a portion of
the shares credited to his account, he may request the Agent to
sell such shares and forward the proceeds less applicable
charges, including any brokerage commission and any transfer tax,
to the Participant. <PAGE 14>
SPECIAL CONSIDERATIONS
Prior to investing in the shares of Common Stock
offered hereby, prospective investors should consider, in
addition to the other information set forth herein, the
following:
Competition
The Company faces significant competition from many
other banks, savings institutions and other financial
institutions which have branch offices or otherwise operate in
the Company's market area, as well as many other companies now
offering a variety of financial services. Many of these
competitors have substantially greater financial resources than
the Company including a larger capital base that allows them to
attract customers seeking larger loans than the Banks are able to
make.
Antitakeover Provisions
The Company's Articles of Incorporation, Bylaws and the
Pennsylvania Business Corporation Law contain certain provisions
which may have the effect of deterring or discouraging, among
other things, a non-negotiated tender or exchange offer for
shares of Common Stock, a proxy contest for control of the
Company; the assumption of control of the Company by a holder of
a large block of Common Stock and the removal of the Company's
management. See "DESCRIPTION OF THE COMPANY CAPITAL
STOCK -- Special Charter and Pennsylvania Corporation Law
Provisions."
Economic Conditions and Related Uncertainties
Commercial banking is affected, directly and
indirectly, by local, domestic, and international economic and
political conditions, and by government monetary and fiscal
policies. Conditions such as inflation, recession, unemployment,
volatile interest rates, tight money supply, scarce natural
resources, real estate values, international conflicts and other
factors beyond the control of the Company and the Banks, may
adversely affect the potential profitability of the Company and
the Banks. Management does not expect any one particular factor
to affect the Company or the Bank's results of operations.
However, a continued downtrend in several areas, including real
estate, construction and consumer spending, could have an adverse
impact on the Company and its ability to maintain or increase
profitability.
<PAGE 15>
Federal and State Government Regulation
The operations of the Company and the Banks are heavily
regulated and will be affected by present and future legislation
and by the policies established from time to time by various
federal and state regulatory authorities. In particular, the
monetary policies of the Federal Reserve Board have had a
significant effect on the operating results of banks in the past,
and are expected to continue to do so in the future.
USE OF PROCEEDS
The proceeds from the sale of Common Stock offered
pursuant to the Plan will be used for general corporate purposes,
including, without limitation, investments in and advances to the
Company's banking subsidiary.
DESCRIPTION OF THE COMPANY'S CAPITAL STOCK
The following is a summary of the material provisions
of the Company's Articles of Incorporation and Bylaws. This
summary does not purport to be complete and is qualified in its
entirety by reference to such instruments, each of which is an
exhibit to the Registration Statement of which this Prospectus
forms a part.
Authorized Capital Stock
The Company has 50,000,000 shares of authorized Common
Stock and 5,000,000 shares of preferred stock. As of June 12,
1998, 9,689,724 shares of Common Stock were issued and
outstanding.
Preferred Stock
The preferred stock of the Company may, in the
discretion of the Company's Board of Directors, be issued, from
time to time, as a class without series or, if so determined by
the Board of Directors, either in whole or in part, in one or
more series. The Board of Directors will have the power to
determine the par value, voting rights, designations, preferences
and other rights, and the qualifications, limitations and
restrictions thereof, of the preferred stock. If any preferred
stock is issued, the holders thereof may have a priority in
liquidation or dissolution over the holders of the Common Stock.
Common Stock
Holders of Common Stock are entitled to one vote for
each share held of record on each matter submitted to a vote at a
meeting of shareholders. Each share of Common Stock is entitled
to share, pro rata, in dividends and in the Company's assets in
the event of dissolution or liquidation of the Company. Holders
of shares of Common Stock do not possess any preemptive rights
and are not entitled to cumulate votes in elections of directors.
<PAGE 16> The outstanding shares of Common Stock are fully paid
and nonassessable. No option, warrant, privilege or right has
been issued or is outstanding other than the options granted to
certain employees of the Company and the Banks under the
Company's Stock Option Plans.
Restrictions on Dividends
The Company's principal sources of funds for payment of
dividends on the Common Stock are dividends, loans and advances
from the Banks.
Dividend payments by Berks County Bank to the Company
are subject to the Pennsylvania Banking Code of 1965 (the
"Banking Code") and the Federal Deposit Insurance Act. Under the
Banking Code, no dividends may be paid except from "accumulated
net earnings" (generally undivided profits). Dividend payments
by Heritage National Bank ("Heritage Bank") to the Company are
subject to the National Bank Act and the Federal Deposit
Insurance Act. Under the National Bank Act, no dividends shall
be made in an amount greater than Heritage Bank's net profits
less losses and bad debts (as each term is defined under the
National Bank Act). The National Bank Act provides that no
dividends may be declared until Heritage Bank's surplus fund (as
defined in the National Bank Act) is equal to its common capital;
provided, however, that quarterly or semi-annual dividends may be
paid if at least ten percent of Heritage Bank's net profits of
the preceding six month period have been carried to the surplus
fund, and that annual dividends may be paid if at least ten
percent of Heritage Bank's net profits from the preceding two
consecutive six month periods have been carried to the surplus
fund. Additionally, cash dividends must be approved by the
Office of the Comptroller of the Currency if the total of all
cash dividends declared by Heritage Bank in any calendar year,
including the proposed cash dividend, exceeds the total of
Heritage Bank's net profits for that year plus its retained net
profits from the preceding two years less any required transfers
to surplus or a fund for the retirement of preferred stock, if
any. Under the Federal Deposit Insurance Act, no dividends may
be paid by an insured bank if the bank is in arrears in the
payment of any insurance assessment due to the FDIC.
State and federal regulatory authorities have adopted
standards for the maintenance of adequate levels of capital by
banks. Adherence to such standards further limits the ability of
the banks to pay dividends. The payment of dividends by any
subsidiary bank may also be affected by other regulatory
requirements and policies. If, in the opinion of the applicable
regulatory authority, a bank under its jurisdiction is engaged
in, or is about to engage in, an unsafe or unsound practice
(which, depending on the financial condition of the bank, could
include the payment of dividends), such authority may require,
after notice and hearing, that such bank cease and desist from
such practice. The Federal Reserve Board and the FDIC have
formal and informal policies which provide that insured banks and
<PAGE 17> bank holding companies should generally pay dividends
only out of current operating earnings, with some exceptions.
Special Charter and Pennsylvania Corporate Law Provisions
The Company will be subject to various provisions of
the BCL which are triggered, in general, if any person or group
acquires, or discloses an intent to acquire, 20% or more of the
voting power of a covered corporation, other than pursuant to a
registered firm commitment underwriting or, in certain cases,
pursuant to the approving vote of the Company's Board of
Directors. The relevant provisions are contained in
Subchapters 25E-H of the BCL.
Subchapter 25E of the BCL (relating to control
transactions) provides that if any person or group acquires 20%
or more of the voting power of a covered corporation, the
remaining shareholders may demand from such person or group the
fair value of their shares, including a proportionate amount of
any control premium.
Subchapter 25F of the BCL (relating to business
combinations) delays for five years and imposes conditions upon
"business combinations" between an "interested shareholder" and
the corporation. The term "business combination" is defined
broadly to include various transactions utilizing a corporation's
assets for purchase price amortization or refinancing purposes.
For this purpose, an "interested shareholder" is defined
generally as the beneficial owner of at least 20% of a
corporation's voting shares.
Subchapter 25G of the BCL (relating to control share
acquisitions) prevents a person who has acquired 20% or more of
the voting power of a covered corporation from voting such shares
unless the "disinterested" shareholders approve such voting
rights. Failure to obtain such approval exposes the owner to the
risk of a forced sale of the shares to the issuer. Even if
shareholder approval is obtained, the corporation is also subject
to Subchapters 25I and J of the BCL. Subchapter 25I provides for
a minimum severance payment to certain employees terminated
within two years of the approval. Subchapter 25J prohibits the
abrogation of certain labor contracts prior to their stated date
of expiration.
Subchapter 25H of the BCL (relating to disgorgement)
applies in the event that (i) any person or group publicly
discloses that the person or group may acquire control of the
corporation or (ii) a person or group acquires (or publicly
discloses an offer or intent to acquire) 20% or more of the
voting power of the corporation and, in either case, sells shares
within 18 months thereafter. Any profits from sales of equity
securities of the corporation by the person or group during the
18-month period belong to the corporation if the securities that
were sold were acquired during the 18-month period or within
24 months prior thereto. <PAGE 18>
Subchapters 25E-H of the BCL contain a wide variety of
transactional and status exemptions, exclusions and safe harbors.
Upon completion of the Consolidation, the Company will be subject
to the provisions of Subchapters 25E through J. Such action can
be reversed under certain circumstances.
In addition, the fiduciary duty standards applicable to
the Board of Directors of the Company under the BCL and certain
provisions of the Company's Articles of Incorporation and Bylaws
may have the effect of deterring or discouraging, among other
things, a nonnegotiated tender or exchange offer for the Common
Stock, a proxy contest for control of the Company, the assumption
of control of the Company by a holder of a large block of the
Common Stock and the removal of the Company's management.
INDEMNIFICATION
Pennsylvania law provides that a Pennsylvania
corporation may indemnify directors, officers, employees and
agents of the corporation against liabilities they may incur in
such capacities for any action taken or any failure to act,
whether or not the corporation would have the power to indemnify
the person under any provisions of law, unless such action or
failure to act is determined by a court to have constituted
recklessness or willful misconduct. Pennsylvania law also
permits the adoption of a bylaw amendment, approved by
shareholders, providing for the elimination of a director's
liability for monetary damages for any action taken or any
failure to take any action unless (1) the director has breached
or failed to perform the duties of his office and (2) the breach
or failure to perform constitutes self-dealing, willful
misconduct or recklessness.
The bylaws of the Company provide for
(1) indemnification of directors, officers, employees and agents
of the registrant and its subsidiaries and (2) the elimination of
a director's liability for monetary damages, to the fullest
extent permitted by Pennsylvania law.
Directors and officers are also insured against certain
liabilities for their actions, as such, by an insurance policy
obtained by the Company.
Insofar as indemnification for liabilities arising
under the 1933 Act may be permitted to the directors, officers
and controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in
the opinion of the Commission such indemnification is against
public policy as expressed in the 1933 Act and is, therefore,
unenforceable.
<PAGE 19>
LEGAL MATTERS
The validity of the shares offered hereby will be
passed upon for the Company by Stevens & Lee, Reading,
Pennsylvania.
EXPERTS
The consolidated financial statements of the Company
incorporated in this Prospectus and the Registration Statement by
reference have been audited by Beard & Company, Inc., independent
auditors, to the extent and for the periods as indicated in their
report and are incorporated herein by reference in reliance upon
such report and upon the authority of such firm as experts in
accounting and auditing.
PAGE 20
<PAGE>
MAIN STREET BANCORP, INC.
SHAREHOLDER AUTOMATIC
DIVIDEND REINVESTMENT
AND
STOCK PURCHASE PLAN
____________________
P R 0 S P E C T U S
____________________
Dated: June 24, 1998
PAGE 21
<PAGE>
TABLE OF CONTENTS
Page
Statement of Available
Information 4
Incorporation of Certain
Documents by Reference 4
The Shareholder Automatic
Dividend Reinvestment and
Stock Purchase Plan 5
Special Considerations 11
Use of Proceeds 13
Description of the Company's
Capital Stock 13
Indemnification of Directors
and Officers 14
Legal Matters 15
Experts 15
PAGE 22
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
SEC Registration Fee $32,766.00
Legal Expenses 2,500.00
Printing Costs 1,500.00
Miscellaneous 500.00*
Total $37,266.00
*Estimated
Item 15. Indemnification of Directors
Pennsylvania law provides that a Pennsylvania
corporation may indemnify directors, officers, employees and
agents of the corporation against liabilities they may incur in
such capacities for any action taken or any failure to act,
whether or not the corporation would have the power to indemnify
the person under any provisions of law, unless such action or
failure to act is determined by a court to have constituted
recklessness or willful misconduct. Pennsylvania law also
permits the adoption of a bylaw amendment, approved by
shareholders, providing for the elimination of a director's
liability for monetary damages for any action taken or any
failure to take any action unless (1) the director has breached
or failed to perform the duties of his office and (2) the breach
or failure to perform constitutes self-dealing, willful
misconduct or recklessness.
The bylaws of the Company provide for (1)
indemnification of directors, officers, employees and agents of
the registrant and its subsidiaries and (2) the elimination of a
director's liability for monetary damages, to the fullest extent
permitted by Pennsylvania law.
Directors and officers are also insured against certain
liabilities for their actions, as such, by an insurance policy
obtained by the Company.
Insofar as indemnification for liabilities arising
under the 1933 Act may be permitted to the directors, officers
and controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in
the opinion of the Commission such indemnification is against
public policy as expressed in the 1933 Act and is, therefore,
unenforceable.
<PAGE 23>
Item 16. Exhibits
The following exhibits are included with this Registration
Statement:
4.1 Articles of Incorporation of Main Street Bancorp, Inc.
(incorporated herein by reference to Exhibit 3.1 of the
Registration Statement No. 333-44697 on Form S-4 of the
Registrant).
4.2 Bylaws of Main Street Bancorp, Inc. (incorporated
herein by reference to Exhibit 3.2 of the Registration
Statement No. 333-44697 on Form S-4 of the Registrant).
5.1 Opinion of Stevens & Lee re: legality of common stock
being registered.
23.1 Consent of Stevens & Lee (included at Exhibit 5.1 of
this Registration Statement).
23.2 Consent of Beard & Company, Inc., independent auditors.
24.1 Power of Attorney (included on signature page).
99.1 Main Street Bancorp, Inc. Shareholder Automatic
Dividend Reinvestment and Stock Purchase Plan.
99.2 Authorization Form for Automatic Dividend Reinvestment
Item 17. Undertakings
The undersigned Registrant hereby undertakes to file
during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to
include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
The undersigned Registrant undertakes that, for the
purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
The undersigned Registrant undertakes to remove from
registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of
<PAGE 24> 1934 (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
PAGE 25
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-3 and has duly caused this Registration Statement on Form S-3
to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Reading, the Commonwealth of
Pennsylvania, as of this 23rd day of June, 1998.
MAIN STREET BANCORP, INC.
By /s/ Nelson R. Oswald
Nelson R. Oswald
Chairman and Chief Executive
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Nelson R.
Oswald, Allen E. Kiefer and Jeffrey P. Waldron, Esquire, and each
of them, his true and lawful attorney-in-fact, as agent with full
power of substitute and resubstitution for him and in his name,
place and stead, in any and all capacity, to sign any or all
amendments to this Registration Statement and to file the same,
with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting
unto such attorney-in-fact and agent full power and authority to
do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully and to
all intents and purposes as they might or could do in person,
hereby ratifying and confirming all that said attorneys-in-fact
and agents, or their substitute or substitutes, may lawfully do
or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement on Form S-3 has been signed
below by the following persons in the capacities as of the dates
indicated.
Signature Title Date
/s/ Nelson R. Oswald Chairman of the June 23, 1998
Nelson R. Oswald Board, Chief
Executive Officer
and Director (Principal
Executive Officer)
/s/ Allen E. Kiefer President, Chief June 23, 1998
Allen E. Kiefer Operating Officer
and Director
<PAGE 26>
/s/ Robert D. McHugh, Jr. Executive Vice June 23, 1998
Robert D. McHugh, Jr. President, Chief Financial
Officer and Treasurer
(Principal Financial Officer)
/s/ Donna L. Rickert Senior Vice June 23, 1998
Donna L. Rickert President, Chief Accounting
Officer and Controller
(Principal Accounting Officer)
/s/ Richard T. Biever Director June 23, 1998
Richard T. Biever
/s/ Edward J. Edwards Director June 23, 1998
Edward J. Edwards
/s/ Richard T. Fenstermacher Director June 23, 1998
Richard T. Fenstermacher
/s/ Ivan H. Gordon Director June 23, 1998
Ivan H. Gordon
/s/ Jeffrey W. Hayes Director June 23, 1998
Jeffrey W. Hayes
/s/ Alfred B. Mast Director June 23, 1998
Alfred B. Mast
Director June __, 1998
Wesley R. Pace
/s/ Frederick A. Gosch Director June 23, 1998
Frederick A. Gosch
/s/ Floyd S. Weber Director June 23, 1998
Floyd S. Weber
/s/Joseph Schlitzer Director June 23, 1998
Joseph Schlitzer
/s/ Albert L. Evans, Jr. Director June 23, 1998
Albert L. Evans, Jr.
PAGE 27
<PAGE>
EXHIBIT INDEX
Page No. in Manually
No. Description Signed Original
4.1 Articles of Incorporation of
Main Street Bancorp, Inc.
(incorporated herein by
reference to Exhibit 3.1 of the
Registration Statement
No. 333-44697 on Form S-4
of the Registrant).
4.2 Bylaws of Main Street Bancorp,
Inc. (incorporated herein by
reference to Exhibit 3.2 of the
Registration Statement
No. 333-44697 on Form S-4 of
the Registrant).
5.1 Opinion of Stevens & Lee re:
legality of common stock being
registered.
23.1 Consent of Stevens & Lee
(included at Exhibit 5.1 of
this Registration Statement).
23.2 Consent of Beard & Company, Inc.,
independent auditors.
24.1 Power of Attorney (included on
signature page).
99.1 Main Street Bancorp, Inc.
Shareholder Automatic Dividend
Reinvestment and Stock Purchase
Plan.
99.2 Authorization Form for Automatic
Dividend Reinvestment <PAGE 28>
Exhibit 5.1
June 25, 1998
Board of Directors
Main Street Bancorp, Inc.
601 Penn Street
Reading, Pennsylvania 19603
Re: Main Street Bancorp, Inc. Shareholder Automatic Dividend
Reinvestment and Stock Purchase Plan
Gentlemen:
You have asked us to provide you with our opinion whether
the 5,000,000 shares of common stock, par value $1.00 per share
(the "Common Stock"), of Main Street Bancorp, Inc. (the
"Company") that may be issued from time to time pursuant to the
exercise of options issued under the Main Street Bancorp, Inc.
Shareholder Automatic Dividend Reinvestment and Stock Purchase
Plan (the "Plan"), when and if such shares are issued pursuant to
and in accordance with the Plan, will be duly and validly issued,
fully paid and nonassessable. We, as counsel to the Company,
have reviewed:
1. The Pennsylvania Business Corporation Law of 1988, as
amended;
2. The Articles of Incorporation of the Company;
3. The By-laws of the Company; and
4. The Resolutions of the Board of Directors of the
Company adopted June 23, 1998 as certified by the Corporate
Secretary of the Company.
Based on our review of such documents, it is our opinion
that the Common Stock issuable under the Plan, when and as issued
and paid for in accordance with the provisions of the Plan, will
be duly and validly issued, fully paid and nonassessable. In
giving the foregoing opinion, we have assumed that the Company
will have, at the time of the issuance of such Common Stock, a
sufficient number of authorized shares available for issue.
We consent to the filing of this opinion as an exhibit to
the registration statement the Company is filing today in
connection with the registration of 5,000,000 shares of the
<PAGE 1> Company's Common Stock. In giving this consent to
inclusion of our name in the Registration Statement under the
caption "Legal Matters", we do not thereby admit that we come
within the category of persons whose consent is required under
Section 7 of the Securities Act of 1933, as amended, or the Rules
and Regulations of the Securities and Exchange Commission
thereunder.
Very truly yours
/s/ STEVENS & LEE
STEVENS & LEE <PAGE 2>
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-3, pertaining to the Main Street
Bancorp, Inc. Shareholder Automatic Dividend Reinvestment and
Stock Purchase Plan, of our report dated May 29, 1998, relating
to the supplemental consolidated financial statements of Main
Street Bancorp, Inc. appearing in the Company's Current Report on
Form 8-K/A dated June 25, 1998.
We also consent to the reference to us under the caption
"Experts" in the Prospectus.
/s/ Beard & Company, Inc.
BEARD & COMPANY, INC.
Reading, Pennsylvania
June 19, 1998
MAIN STREET BANCORP, INC.
SHAREHOLDER AUTOMATIC DIVIDEND REINVESTMENT
AND STOCK PURCHASE PLAN
As of ______________ the Board of Directors of MAIN
STREET BANCORP, INC. (the "Company") has established the
Shareholder Automatic Dividend Reinvestment and Stock Purchase
Plan (the "Plan") to provide the Company's shareholders with a
simple, convenient and systematic method for investing quarterly
cash dividends and optional cash payments in additional common
stock of the Company. Any proceeds received by the Company from
sales of common stock under the Plan will provide additional
funds which may be used for such purpose or purposes as the
Company, in its discretion, may deem advisable.
The following sets forth the text of the Plan in its
entirety.
Section 1. Definitions:
The following words and phrases, when capitalized and
used herein, shall have the indicated meanings unless the context
clearly indicates otherwise:
(a) Agent: Heritage National Bank, 120 South
Centre, P.O. Box 1100, Pottsville, Pennsylvania 17901.
(b) Bank: Berks County Bank.
(c) Cash Contribution Purchase Price: the Market
Price Per Share of the Company's Common Stock on the
dividend payment date.
(d) Market Price Per Share of the Company's
Common Stock: (i) as reported on the NASDAQ Stock Market on
any relevant date (or if not a trading date, on the last
prior trading day on which a trade is reported); or (ii) if
the Company's Common Stock is listed for trading on a
national exchange, the mean between the high and low prices
on such exchange on any relevant date, as reported in the
financial press (or if not a trading date, on the last prior
trading day on which a trade is reported).
(e) Company: Main Street Bancorp, Inc.
(f) Common Stock: the Company's common stock,
par value $2.50 per share.
(g) Participant: Any holder of shares of the
Company's Common Stock who meets the eligibility
requirements set forth at Section 3 of the Plan and who
effects the authorizations required by Section 4 of the
Plan. <PAGE 1>
(h) Plan: This Shareholder Automatic Dividend
Reinvestment and Stock Purchase Plan, as it may be hereafter
amended, supplemented, or modified.
(i) Purchase Price: Such price as is actually
paid by the Company using its best efforts under the
circumstances with respect to purchases made in the market
or in negotiated transactions.
(j) Record Date: The date for determining
shareholders of record for the purpose of receiving any
quarterly dividends.
(k) Reinvested Dividend Purchase Price:
Ninety-five percent (95%) of the Market Price Per Share of
the Company's Common Stock on the dividend payment date.
Section 2. Purpose.
The purpose of the Plan is to provide record holders of
one (1) or more shares of the Company's Common Stock with an
attractive and convenient method of investing cash dividends and
voluntary cash payments in the Company's Common Stock for
long-term growth. The Plan is not intended to provide short-term
holders of shares with the means to acquire additional shares at
a discount from market price or to provide holders of shares with
the means to generate short-term profits through resale of shares
acquired at a discount from market price. The intended purpose
of the Plan precludes any person, organization or other entity
from establishing a series of related arbitrage operations or
exceeding the voluntary cash payment limit. The Company
accordingly reserves the right to modify, suspend or terminate
participation by a shareholder who the Company determines is
using the Plan for purposes inconsistent with the intended
purpose of the Plan.
Section 3. Eligibility.
Any holder of one (1) or more shares of the Company's
Common Stock is eligible to participate in the Plan commencing as
of the date such shares are registered in his name on the books
of the Company.
Section 4. Participation.
(a) Full and Partial Dividend Reinvestment
Options. In order to participate in the Plan, a shareholder
who meets the eligibility requirements set forth in
Section 3 must, on such form or forms and in such manner as
may from time to time be prescribed by the Company,
designate and authorize the Company, on such shareholder's
behalf, to reinvest all of the quarterly dividends payable
on at least one (1) or more of such shareholder's shares of
the Company's Common Stock held of record in additional
<PAGE 2> shares of the Company's Common Stock pursuant to
the provisions of Section 6 or Section 7 of the Plan, as the
case may be. Participation, once commenced, shall continue
until a Participant withdraws as such from the Plan in
accordance with Section 12(a) of the Plan or until the Plan
terminates in accordance with Section 13(d) of the Plan.
(b) Voluntary Cash Payment Option. A shareholder
who meets the eligibility requirements set forth at
Section 3 of the Plan and who elects to participate in the
Plan by meeting the requirements set forth in subsection (a)
of this Section 4 may, from time to time as the Board of
Directors of the Company may in its discretion determine,
invest cash in an amount not to exceed $3,000.00 per
quarter, in integral multiples of $25.00, in additional
shares of the Company's Common Stock, by (i) designating and
authorizing the Agent on the form or forms received by the
Agent as described in subsection (a) of this Section 4, to
apply all of such cash to the purchase, on such
Participant's behalf, of additional shares of the Company's
Common Stock, pursuant to the provisions of Section 6 or
Section 7 of the Plan, as the case may be, and (ii) by
transmitting such cash amount to the Agent so that it is
received by the Agent on or before the dividend payment
date, or in the case of a voluntary cash payment made by
check or other draft, by transmitting such check or draft so
that it has cleared prior to the dividend payment date.
Section 5. Agent; Payments by the Company.
The Agent shall be the administrative agent for a
Participant to receive dividends and voluntary cash payments made
by a Participant pursuant to Section 4(b) of the Plan and to
purchase shares of the Company's Common Stock for Participants.
The Agent shall act in such capacity in accordance with the
provisions of Section 6 or Section 7 of the Plan, as the case may
be.
Section 6. Dividend Reinvestment and Cash Purchases
from the Company.
In the event that the Agent does not purchase shares of
the Company's Common Stock on the NASDAQ Stock Market in
accordance with the provisions of Section 7 of the Plan, the
Agent shall, for each Participant, apply:
(a) the quarterly dividends authorized to be
reinvested pursuant to Section 4(a) of the Plan that are
attributable to shares registered in such Participant's name
on the books of the Company as of the Record Date to the
purchase on the dividend payment date, at the Reinvested
Dividend Purchase Price, of additional shares (including
fractions of a whole share computed to 4 decimal places) of
<PAGE 3> the Company's Common Stock held in treasury or
authorized but unissued Company Common Stock;
(b) the quarterly dividends attributable to
shares (including fractions of a whole share computed to 4
decimal places) credited to such Participant's account
pursuant to Section 8(b) of the Plan as of the Record Date
to the purchase on the dividend payment date, at the
Reinvested Dividend Purchase Price, of additional shares
(including fractions of a whole share computed to 4 decimal
places) of the Company's Common Stock held in treasury or
authorized but unissued Company Common Stock; and
(c) the cash payments duly authorized and paid by
such Participant pursuant to Section 4(b) of the Plan to the
purchase on the dividend payment date, at the Cash
Contribution Purchase Price, of additional shares (including
fractions of a whole share computed to 4 decimal places) of
the Company's Common Stock held in treasury or authorized
but unissued Company Common Stock.
Section 7. Dividend Reinvestment and Cash Purchases
Other Than from the Company.
(a) Notwithstanding the provisions of Section 6
of the Plan, the Agent may, subject to approval of the
Company, and in the event that either of the Cash
Contribution Purchase Price or the Reinvested Dividend
Purchase Price is less than the par value per share of the
Company's Common Stock ($2.50), the Agent shall, following
the dividend payment date, for each Participant, apply:
(i) the quarterly dividends authorized to be
reinvested pursuant to Section 4(a) of the Plan that
are attributable to (A) shares registered in such
Participant's name on the books of the Company as of
the Record Date, and (B) shares (including fractions of
a whole share computed to 4 decimal places) credited to
such Participant's account pursuant to Section 8(b) of
the Plan as of the Record Date; and
(ii) the cash payments duly authorized and
paid by such Participant pursuant to Section 4(b) of
the Plan;
to the purchase of whole shares of the Company's Common
Stock in accordance with Section 7(b) below.
(b) All purchases of the Company's Common Stock
pursuant to this Section 7 shall be made at such times as
the Agent may determine within thirty (30) days of the
relevant dividend payment date, or such later date as may be
necessary or advisable under any applicable federal
securities laws. Any such purchases shall be made through
<PAGE 4> one or more broker-dealers independent of the
Company in the over-the-counter market, on an exchange, or
in negotiated transactions upon such terms as to price,
delivery, and related matters as the broker-dealer deems
advisable, subject to approval of the Company with respect
to negotiated transactions. In making purchases on behalf
of a Participant, the Agent may commingle such Participant's
funds with those of other Participants. The price at which
the Agent shall be deemed to have acquired shares for each
Participant's account shall be (i) ninety-five percent (95%)
of the weighted average Purchase Price with respect to all
shares purchased with amounts applied in accordance with
Section 7(a)(i) above and (ii) the weighted average Purchase
Price with respect to all shares purchased with amounts
applied in accordance with Section 7(a)(ii) above, in each
case excluding any fees, commissions, costs or expenses
relating to such purchases. Neither any broker-dealer, the
Company, the Agent nor the Bank shall be liable for any
loss, damage or expense resulting, directly or indirectly,
from the failure to make a purchase or from the timing of
any purchase made. Shares of the Company's Common Stock
purchased pursuant to this Section 7 shall be purchased in
the name of the Agent or its nominee.
Section 8. Administration of the Plan.
(a) The Agent shall administer the Plan for all
Participants.
(b) All shares of the Company's Common Stock
purchased by the Agent pursuant to Section 6 and Section 7
of the Plan, including any fractions of a whole share, shall
be registered in the name of the Agent or its nominee as
agent for each Participant and shall be credited to such
Participant's account on the books and records of the Plan,
which books and records shall be maintained at all times by
the Agent. The Agent shall transmit to a Participant no
later than thirty (30) days following the dividend payment
date or a voluntary cash purchase date, and not loess than
quarterly, a statement setting forth the total number of
whole shares and fractions of a whole share of the Company
Common Stock credited to such Participant's account.
(c) On written request, the Agent will send a
Participant certificates for any full shares of the
Company's Common Stock credited to his account; provided
that no such request received during the period beginning
five (5) trading days prior to a Record Date and ending on
the corresponding dividend payment date shall be effective
until after the reinvestment of dividends pursuant to this
Plan. No share certificate for any full share of the
Company's Common Stock shall be issued to any Participant
except pursuant to such request or upon such Participant's
withdrawal from the Plan in accordance with Section 12(a) of
<PAGE 5> the Plan or termination of the Plan in accordance
with Section 13(d) of the Plan. In no event shall any
certificate be issued evidencing a fraction of a whole share
of the Company's Common Stock.
(d) Participants may deposit free of charge with
the Agent for safekeeping any certificate for shares of the
Company's Common Stock subject to reinvestment of dividends
under the Plan.
(e) All costs of administering the Plan,
including without limitation any brokerage commission or
other fee payable to or through any broker-dealer or any
other party in connection with the purchase of shares, shall
be paid by the Company.
Section 9. Voting of Shares Held Under the Plan.
(a) All shares of the Company's Common Stock held
for a Participant in such Participant's account under the
Plan shall be voted at a meeting of the Company's
shareholders in accordance with the instructions of such
Participant given on any proxy executed by such Participant
and returned to the Agent with respect to such shares. A
Participant desiring to vote shares of the Company's Common
Stock held for a Participant in such Participant's account
under the Plan in person at a meeting of the Company's
shareholders may do so. Shares of the Company's Common
Stock held for a Participant in such Participant's account
under the Plan will not be voted at a meeting of the
Company's shareholders if voting instructions on a proxy are
not received by the Company from such Participant or if such
Participant does not vote such shares in person at the
meeting.
(b) Each Participant shall have the right to
instruct the Agent as to the manner in which to respond to a
tender or exchange offer for shares of the Company Common
Stock, with respect to such shares in such Participant's
account.
Section 10. Stock Dividends and Stock Splits on Shares
Held in Plan.
Shares of the Company's Common Stock (including any
fraction of a whole share) distributed as a result of the
declaration of a stock dividend or a stock split on shares
credited to the account of a Participant under the Plan shall be
added to his account and shall be shares subject to the Plan, and
shall be treated, for all purposes, as if held by such
Participant directly.
<PAGE 6>
Section 11. Effect of Rights Offering on Shares Held in Plan.
In the event that the Company grants to its
shareholders rights to purchase additional shares of the
Company's Common Stock or other securities, rights shall be
granted to the Participant on whole shares of the Company's
Common Stock credited to the account of a Participant under the
Plan. Rights based on any fraction of a share credited to such
Participant's account shall at the Company's option be either
redeemed by the Company for cash or sold for such Participant,
and the net proceeds therefrom shall be credited to his account
and shall be invested as an optional cash payment in accordance
with the provisions of Section 6 or Section 7 of the Plan, as the
case may be.
Section 12. Withdrawal from the Plan.
(a) A Participant may withdraw from the Plan in
whole or in part at any time by giving the Agent written
notice thereof, but any such notice received by the Agent
later than five (5) days prior to a Record Date shall not be
effective until dividends paid for such Record Date have
been credited to such Participant's account. Upon
withdrawal, certificates for the number of whole shares
specified in the Participant's notice and credited to a
Participant's account under the Plan shall be issued to such
Participant and, in the event of a total withdrawal, a cash
payment shall be made for any fractions of a whole share
credited to such Participant's account (based upon the
Market Price Per Share of the Company's Common Stock on the
date the withdrawal request is received, or the last prior
trading day). A Participant who withdraws in whole in
accordance with this Section 12(a) shall again have the
right to participate in the Plan, provided such Participant
meets the eligibility requirements set forth at Section 3 of
the Plan and makes the designation and authorization
required by Section 4(a) of the Plan.
If a Participant so requests in writing, the Agent
shall within seven (7) business days following receipt of
such notice place a sale order for the number of shares
specified in the Participant's notice and credited to such
Participant's account and shall deliver the proceeds
therefrom, less any brokerage fee, transfer tax, and costs,
to the withdrawing Participant.
(b) If a Participant disposes of all the shares
registered in such Participant's name that are enrolled in
the Plan, the Agent shall, until otherwise notified,
continue to reinvest the dividends on the shares of the
Company's Common Stock held in such Participant's account.
However, if such Participant holds less than fifty (50) full
shares of the Company's Common Stock in the Plan, such
Participant shall be deemed to have withdrawn from the Plan.
<PAGE 7>
Section 13. Amendment, Supplementation, Waiver,
Suspension, or Termination.
(a) The Plan may be amended or supplemented by
the Company at any time or times by mailing appropriate
notice to each Participant at such Participant's last
address of record prior to the effective date of such
amendment or supplementation. The amendment or supplement
shall conclusively be deemed to be accepted by each
Participant unless the Agent receives written notice from a
Participant of such Participant's withdrawal from the Plan
in accordance with Section 12(a) of the Plan. Amendments or
supplements may be required from time to time due to changes
in existing rules and regulations or new rules and
regulations issued by a governing authority. In such cases,
the Company may make such amendments or supplements as
required, and thereafter notify each Participant thereof.
(b) Any waiver of any provision of the Plan must
be made by the Company in writing, and each waiver, if any,
shall only apply to the specific instance involved.
(c) The Plan may be suspended by the Company at
any time or times, from time to time, by mailing appropriate
notice to each Participant at such Participant's last
address of record prior to the effective date of such
suspension. In the event of a suspension of this Plan, all
voluntary cash contributions paid by Participants pursuant
to Section 4(b) of the Plan shall be returned to such
Participants immediately.
(d) The Plan may be terminated by the Company at
any time by mailing appropriate notice to each Participant
at such Participant's last address of record prior to the
effective date of such termination. In the event of
termination of the Plan, certificates for whole shares of
the Company's Common Stock credited to a Participant's
account under the Plan shall be issued to such Participant
and a cash payment shall be made for any fractional shares
credited to such Participant's account (computed according
to Section 12(a) of the Plan).
Section 14. Miscellaneous.
(a) In the event that the Company shall, as of
any dividend payment date, have insufficient authorized
shares of the Company's Common Stock available for issuance
pursuant to any purchase required to be made under Section 6
of the Plan, all shares available shall be issued and
credited pro rata to all Participants' accounts. All
uninvested dividends shall be paid to Participants in cash.
<PAGE 8>
(b) There shall be 5,000,000 shares of the
Company's Common Stock available for purchase under the
Plan.
(c) Neither the Company nor the Bank shall be
liable for any loss, damage, or expense arising out of or
resulting from any act performed in good faith or any good
faith omission on the part of any of them including, but not
limited to, (i) the Company's failure to terminate a
Participant's account upon such Participant's death or the
transfer of such Participant's shares prior to a reasonable
length of time after receipt of notice in writing of such
death or such transfer; (ii) any purchase or failure to
purchase shares for a Participant's account at a particular
time or day or at a particular price; and/or
(iii) modifying, suspending or terminating participation by
a shareholder who the Company determines is using the Plan
for purposes inconsistent with the intended purposes of the
Plan.
(d) A Participant shall notify the Agent promptly
in writing of any change of address. Notices to a
Participant may be given by letter addressed to such
Participant at such Participant's last address of record on
file with the Company.
(e) No Participant shall have any right to draw
checks or drafts against his account or to give instructions
to the Company with respect to any shares or cash held
therein except as expressly provided herein, nor shall a
Participant have the right to sell, assign, or transfer his
account.
Section 15. Effective Date of Plan.
The effective date of the Plan shall be ______________.
Section 16. Governing Law.
The validity and enforceability of the Plan and the
rights and obligations set forth therein shall be governed by the
law (but not the law of conflicts of law) of the Commonwealth of
Pennsylvania. <PAGE 9>
