As filed with the Securities and Exchange Commission on June 26,
1998.
Registration No. 333-______
_________________________________________________________________
_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM S-8
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.)
601 Penn Street, Reading, PA 19603
(Address of Principal Executive Offices) (Zip Code)
Main Street Bancorp, Inc. 1995 Stock Option Plan
for Non-Employee Directors
(Full title of the Plan)
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
601 Penn Street P.O. Box 1275
Reading, PA 19603 Wayne, PA 19087
(610) 685-1400 (610) 293-4961
(Names, Addresses and Telephone Numbers of Agents for Service)
CALCULATION OF REGISTRATION FEE
_________________________________________________________________
<TABLE>
<CAPTION>
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Unit Price Fee
<S> <C> <C> <C> <C>
Common stock, 53,340 $26.125 $1,393,507.50(1) $423
$1.00 par value
per share
______________________________________________________________________________
<PAGE 1>
<FN>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457, on the basis of the closing price of Main Street
Bancorp, Inc. common stock on June 23, 1998.
</TABLE>
PAGE 2
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents have been filed by Main Street
Bancorp, Inc. (the "Registrant") with the Securities and Exchange
Commission ("SEC") and are incorporated herein by reference:
(a) Registrant's Current Report on Form 8-K dated May 15,
1998 filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended (the
"Exchange Act") and as amended on Form 8-K/A on
June 25, 1998.
(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 Registrant's common stock, par
value $1.00 per share (the "Common Stock"), set forth
in the Registrant's Registration Statement on Form 8-A
filed with the Securities and Exchange Commission on
April 30, 1998, and as amended on Form 8-A/A on May 8,
1998.
All documents subsequently filed by the Registrant pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior
to the filing of a post-effective amendment which indicates that
all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to
be a part hereof from the date of filing 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 hereof to the extent that a
statement contained herein or in any other subsequently filed
incorporated document 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 hereof.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
<PAGE 3>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
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 an failure to act, whether or not the
corporation would have the power to indemnify the person under
any provision 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 (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.
ITEM 7. INCORPORATION OF DOCUMENTS BY REFERENCE
Not applicable.
ITEM 8. EXHIBITS
4.1 Articles of Incorporation of Main Street Bancorp,
Inc., as amended, 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 Beard & Company, Inc., independent
auditors.
24. Power of Attorney (included on signature page).
99.1 Main Street Bancorp, Inc. 1995 Stock Option Plan
for Non-Employee Directors.
<PAGE 4>
ITEM 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
registration statement to include any additional or changed
material information with respect to the plan of distribution.
(2) That, for the purpose of determining
liability under the Securities Act of 1933, to treat each
post-effective amendment as a new registration statement of the
securities offered, and the offering of such securities at that
time to be the initial bona fide offering thereof.
(3) To file a post-effective amendment to remove
from registration any of the securities being registered which
remain unsold at the termination of the offering.
Provided, however, that subparagraphs (a)(1)(i)
and (a)(1)(ii) of this section do not apply if the information
required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the Registration Statement.
(4) 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.
(5) To remove from registration by means of a
post-effective amendment any of the securities being registered
that remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that,
for the purpose 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 1934 (and, where applicable, each filing of a
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in this
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.
(c) The undersigned Registrant hereby undertakes to
deliver or cause to be delivered with the prospectus, to each
person to whom the prospectus is sent or given, the latest annual
report to security holders that is incorporated by reference in
the prospectus and furnished pursuant to and meeting the
<PAGE 5> requirements of Rule 14a-3 or Rule 14c-3 if under the
Securities Act of 1934; and, where interim financial information
required to be presented by Article 3 of Regulation S-X are not
set forth in the prospectus, to deliver, or cause to be delivered
to each person to whom the prospectus is sent or given, the
latest quarterly report that is specifically incorporated by
reference in the prospectus to provide such interim financial
information.
(d) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
PAGE 6
<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-8 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Reading, Commonwealth of Pennsylvania,
on June 23, 1998.
MAIN STREET BANCORP, INC.
By:/s/ Nelson R. Oswald
Nelson R. Oswald
Chairman and Chief Executive
Officer
POWER OF ATTORNEY
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 and agent, with
full power of substitution and resubstitution, for such person
and in such person's name, place and stead, in any and all
capacities, to sign any and all amendments (including post-
effective amendments) to the Registration Statement to which this
power of attorney is attached, and to file all those amendments
and all exhibits to them and other documents to be filed in
connection with them, with the Securities and Exchange
Commission, granting unto such attorneys-in-fact and agents 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 has been signed below by the
following persons in the capacities and on the date indicated
below.
Signature Title Date
/s/ Nelson R. Oswald Chairman and June 23, 1998
Nelson R. Oswald Chief Executive Officer
(Principal Executive
Officer)
/s/ Allen E. Kiefer President and June 23, 1998
<PAGE 7>
Allen E. Kiefer Chief Operating
Officer
/s/ Robert D. McHugh, Jr. Executive Vice June 23, 1998
Robert D. McHugh, Jr. President and Chief
Financial Officer
(Principal Financial
Officer)
/s/ Richard A. Ketner Executive Vice June 23, 1998
Richard A. Ketner President and Chief
Administrative
Officer
/s/ Donna L. Rickert Vice President and June 23, 1998
Donna L. Rickert Controller (Principal
Accounting Officer)
/s/ Richard D. Biever Director June 23, 1998
Richard D. 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/ 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 8
<PAGE>
INDEX TO EXHIBITS
Sequential
Exhibit No. Exhibit Page Number
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 Beard & Company, Inc., independent
auditors.
24. Power of Attorney (included on signature
page).
99.1 Main Street Bancorp, Inc. 1995 Stock
Option Plan for Non-Employee Directors. <PAGE 9>
Exhibit 5.1
June 26, 1998
Board of Directors
Main Street Bancorp, Inc.
601 Penn Street
Reading, Pennsylvania 19603
Re: Main Street Bancorp, Inc. 1995 Stock Option Plan for Non-
Employee Directors
Gentlemen:
You have asked us to provide you with our opinion whether
the 40,000 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. 1995 Stock
Option Plan for Non-Employee Directors (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 upon the exercise of options
granted 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 40,000 shares of the
<PAGE 1> Company's Common Stock. In giving this consent, 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 23.1
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8, pertaining to the Main Street
Bancorp, Inc. 1995 Stock Option Plan for Non-Employee Directors,
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.
/s/ Beard & Company, Inc.
BEARD & COMPANY, INC.
Reading, Pennsylvania
June 19, 1998
EXHIBIT "B"
MAIN STREET BANCORP, INC.
1995 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
1. Purpose of the Plan.
The purpose of the Main Street Bancorp, Inc. 1995 Stock
Option Plan for Non-Employee Directors is to promote the success
of Main Street Bancorp, Inc. (the "Company") by attracting and
retaining non-employee directors of the Company and its
wholly-owned subsidiary, Heritage National Bank (the "Bank"), by
supplementing their cash compensation and providing a means for
them to increase their holdings of common stock of the Company.
2. Definitions.
As used herein, the following definitions shall apply:
2.1 "Annual Meeting Date" means the date of the Annual
Meeting of the shareholders of the Company at which directors are
elected.
2.2 "Bank" means Heritage National Bank, a
wholly-owned subsidiary of the Company.
2.3 "Code" means the Internal Revenue Code of 1986, as
amended.
2.4 "Committee" means any committee of the Company
Board designated by the Company Board to administer the Plan
pursuant to Section 4 hereof.
2.5 "Common Stock" means the Common Stock, par value
$1.00 per share, of the Company.
2.6 "Company" shall refer to Main Street Bancorp,
Inc., a Pennsylvania corporation.
2.7 "Company Annual Meeting" means the annual meeting
of the shareholders of the Company (as described in the By-Laws
of the Company) at which directors are elected.
2.8 "Company Board" means the Board of Directors of
the Company.
2.9 "Eligible Director" means, as of any date and/or
time, any person who is a member of the Company Board or the Bank
Board and who is not an employee, full-time or part-time, of the
Company, the Bank or any of their Subsidiaries as of such date
and/or time; an advisory, emeritus or honorary director of the
Company or the Bank shall not be considered a member of the
<PAGE B-1> Company Board or the Bank Board, as the case may be,
and shall not be an "Eligible Director" for purposes of this
Plan.
2.10 "Fair Market Value" as of any date means the
market price of the Shares, determined by the Company Board as
follows:
(a) The Fair Market Value shall be equal to the
average of the high and low sales prices of the Shares
reported in Nasdaq trading for that date or if no reported
sale of Shares shall have occurred on such date, then on the
next preceding day on which there was a reported sale.
(b) If the Shares were traded over-the-counter on
the date in question but the Stock was not classified by
Nasdaq as a national market issue (or, in the judgment of
the Company Board, a comparable designation), then the Fair
Market Value shall be equal to the mean between the last
reported representative bid and asked prices quoted by the
Nasdaq system for such date.
(c) If the Shares were traded on a stock exchange
on the date in question, then the Fair Market Value shall be
equal to the closing price reported by the applicable
composite transactions report for such date; and
(d) If none of the foregoing provisions is
applicable, then the Fair Market Value shall be determined
by the Company Board in good faith on such basis as it deems
appropriate.
Whenever possible, the determination of Fair Market Value by the
Company Board shall be based on the prices reported in the
Eastern Edition of THE WALL STREET JOURNAL. Such determination
shall be conclusive and binding on all persons.
2.11 "Option" means a stock option granted pursuant to
this Plan, which shall be nonstatutory options not intended to
qualify under Section 422 of the Code.
2.12 "Option Agreement" means the agreement between the
Company and an Optionee for the grant of an option.
2.13 "Option Price" means the purchase price for Shares
to be purchased pursuant to an Option, which shall be the Fair
Market Value as of the date of grant.
2.14 "Option Stock" means stock subject to an Option
granted pursuant to this Plan.
2.15 "Optionee" means a person who receives an Option.
<PAGE B-2>
2.16 "Plan" means this 1995 Stock Option Plan for
Non-Employee Directors, as the same may be amended from time to
time by the Company Board.
2.17 "Shares" means shares of the Common Stock.
2.18 "Subsidiary" means a "subsidiary corporation" as
defined in Section 424(f) and (g) of the Code.
3. Stock Subject to the Plan.
The maximum number of Shares which may be optioned and
sold under the Plan shall be 40,000 Shares, subject to adjustment
in accordance with Section 10 hereof. Such Shares shall be
authorized but unissued Shares or Shares reacquired by the
Company, including, without limitation, Shares purchased in the
open market or in private transactions. If an Option should be
cancelled or terminated or expire or become unexercisable for any
reason without having been exercised in full, the unpurchased
Shares which were subject thereto shall, unless the Plan shall
have been terminated, become available for the grant of other
Options under the Plan and shall not be counted against the total
number of Shares.
4. Administration of the Plan.
This Plan shall be administered by the Company Board or
any Committee of the Company Board so designated by the Company
Board, which Board or Committee, as the case may be, shall have
authority to adopt such rules and regulations, and to make such
determinations as are not inconsistent with the Plan and are
necessary or desirable for its implementation and administration.
If any such Committee is designated by the Company Board,
references herein to administrative actions or authority of the
Company Board shall be deemed to refer to actions or authority of
the Committee, unless the context otherwise requires.
5. Grants of Options.
5.1 Nondiscretionary Annual Grants. An Option to
purchase 200 Shares (as adjusted pursuant to Section 10) shall be
granted automatically each year, immediately following the
Company Annual Meeting, to each Eligible Director as of such
time:
(a) who is a director of the Company, or
(b) who is a director of the Bank but not a
director of the Company,
such grants to begin with the Company Annual Meeting at which the
Plan is approved by shareholders of the Company.
5.2 Adjustment. Any outstanding Option shall be
subject to adjustment from time to time in accordance with
<PAGE B-3> Section 10 hereof. The initial number of shares to be
subject to Options to be granted pursuant to Section 5. 1
subsequent to any adjustment in accordance with Section 10 hereof
shall also be adjusted; provided, however, that at the time of
grant of any such Option, the number of Shares subject to such
Option shall, if necessary, be rounded down to the nearest whole
number.
6. Term of Plan.
This Plan shall become effective immediately following
approval by the shareholders of the Company, and shall continue
in effect until all Options granted hereunder have expired or
been exercised, unless sooner terminated under the provisions
hereof.
7. Terms of Option Agreement.
Upon the grant of each Option, the Company and the
Eligible Director shall enter into an Option Agreement which
shall specify the Grant Date and the Option Price, and shall
include or incorporate by reference this Plan, including the
substance of all of the following provisions and such other
provisions consistent with this Plan as the Company Board may
determine.
7.1 Term. The term of the Option shall be ten years
from its Grant Date, subject to earlier termination in accordance
with Sections 7.6, 10.2, 10.3 or 10.4 hereof.
7.2 Exercisability. The Option shall be immediately
exercisable.
7.3 Option Price. The purchase price of the Shares
subject to each Option (the "Option Price") shall be the Fair
Market Value thereof on the date such Option is granted.
7.4 Payment of Purchase Price. The purchase price of
Shares acquired pursuant to an Option shall be paid in full at
the time the Option is exercised, in cash.
7.5 Nontransferability. No Option shall be
transferable otherwise than by will or the laws of descent and
distribution, and an Option shall be exercisable during the
Eligible Director's lifetime only by the Eligible Director.
7.6 Termination of Eligible Director Status. If an
Eligible Director's status as an Eligible Director terminates for
any reason, an Option held at the date of termination of Eligible
Director status may be exercised in whole or in part at any time
within one year after the date of such termination (but in no
event after the term of the Option expires) and shall thereafter
automatically terminate.
<PAGE B-4>
8. Use of Proceeds.
Proceeds from the sale of Shares pursuant to this Plan
shall be used by the Company for general corporate purposes.
9. Exercise of Options.
9.1 Procedure for Exercise. An Option may be
exercised, in whole or in part, from time to time prior to its
expiration or termination. An Option shall be deemed to be
exercised when written notice of such exercise has been given to
the Company in accordance with the terms of the Option by the
person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been
received by the Company. The minimum number of Shares with
respect to which an Option may be exercised at any one time shall
be one hundred (100) Shares, unless the number purchased is the
total number at the time available for purchase under the Option.
An Option may not be exercised for a fractional Share. No Option
may be exercised after the expiration of its term as specified in
Section 7.1. Until the issuance of the stock certificates (as
evidenced by the appropriate entry on the books of the Company or
of a duly authorized transfer agent of the Company), no light to
vote or receive dividends or any other rights as a shareholder
shall exist with respect to Option Shares notwithstanding the
exercise of the Option. No adjustment will be made for a
dividend or other rights for which the record date is prior to
the date the stock certificates are issued except as provided in
Section 10 of the Plan.
9.2 Exercise Following Death or Disability. In the
case of Optionee's death, exercise shall be by the person or
persons (including his estate) to whom his rights under such
Option shall have passed by will or by laws of descent and
distribution.
9.3 Compliance with Law: Legend on Shares. The
exercise of each Option shall be on the condition that the
purchases of Shares or other securities thereunder shall be for
investment purposes, and not with a view to resale or
distribution unless the Shares or other securities subject to
such Option are registered under the Securities Act of 1933, as
amended, and any applicable state laws, or if in the opinion of
counsel for the Corporation such registration is not required
under the Securities Act of 1933 or any other applicable law,
regulation, or rule of any state or governmental agency. Any
Share certificate may bear legends and statements the Company
Board shall deem advisable to assure compliance with federal and
state laws and regulations.
<PAGE B-5>
10. Adjustment Upon Changes in Capitalization.
10.1 Changes in Capitalization. If the number of
Shares of the Company as a whole are increased, decreased or
changed into, or exchanged for, a different number or kind or
shares or securities of the Company, whether through merger,
consolidation, reorganization, recapitalization,
reclassification, stock dividend, stock split, combination of
shares, exchange of shares, change in corporate structure or the
like, an appropriate and proportionate adjustment shall be made
in the number and kind of shares subject to this Plan, in the
initial number and kind of shares to be subject to Options to be
granted pursuant to Section 5 hereof subsequent to such event,
and in the number, kind, and per share exercise price of Shares
subject to unexercised Options or portions thereof granted prior
to any such change. Any such adjustment in an outstanding
Option, however, shall be made without a change in the total
price applicable to the unexercised portion of the Option but
with a corresponding adjustment in the price for each Share
covered by the Option. A change in only the par value of the
Shares shall not require any adjustment in the number of Shares
subject to the Option.
10.2 Acquisition. Any agreement to which the Company is
a party which provides for any merger, consolidation or similar
transaction of the Company with or into another corporation
whereby the Company is not to be the surviving corporation may
provide, without limitation, for the assumption of outstanding
Options by the surviving corporation or its parent, for
accelerated vesting and accelerated expiration, or for an
equitable mandatory settlement of outstanding Options in cash
based on the consideration paid to shareholders in such
transaction and all outstanding Options shall be subject to such
agreement. In any case where the Options are assumed by another
corporation, appropriate equitable adjustments as to the number
and kind of shares or other securities and the per share purchase
prices shall be made.
10.3 Fractional Shares. No fractional Shares shall be
issued under the Plan on account of any adjustment specified
above; provided, however, that prior to exercise, fractional
Shares shall be carried through in adjustments of Shares subject
to outstanding Options. In determining the initial number of
shares to be subject to Options granted subsequent to any event
causing an adjustment pursuant to this Section 10, Options for
fractional shares shall not be granted and the initial adjusted
number of shares to be subject to such Options shall be rounded
down, if necessary, to the nearest whole number as provided in
Section 5.2 hereof. In the event that an Option is exercised for
all full or whole Shares subject to the Option, the Option shall
be deemed rounded down to the nearest whole number and, upon
exercise for such whole number of Shares, the Option shall
terminate.
<PAGE B-6>
10.4 Dissolution or Liquidation. Upon the dissolution
or liquidation of the Company, this Plan and the Options issued
thereunder shall terminate.
10.5 Determinations by the Company Board or Committee.
All determinations as to appropriate adjustments pursuant to this
Section 10 shall be made by the Company Board or, if the Company
Board has designated a Committee to administer the Plan as
provided in Section 4 hereof, by the Committee and all such
determinations shall be binding and conclusive on all parties.
11. Approval, Amendment and Termination of the Plan.
11.1 Approval. This Plan shall be adopted by the
Company Board, and shall be presented to the shareholders of the
Company for their approval by vote of a majority of such
shareholders present, or represented, and entitled to vote at a
meeting duly held.
11.2 Amendment. The Company Board may amend, terminate
or suspend the Plan at any time, in its sole and absolute
discretion; provided, however, that if required to qualify the
Plan under Rule 16b-3 promulgated under Section 16 of the
Securities Exchange Act of 1934, as amended, no amendment shall
be made more than once every six months that would change the
amount, price or timing of the annual grants, other than to
comport with changes in the Internal Revenue Code of 1986, as
amended, the Employee Retirement Income Security Act, or the
rules and regulations promulgated thereunder; and provided,
further, that if required to qualify the Plan under Rule 16b-3,
no amendment that would
(a) materially increase the number of securities
that may be issued under the Plan,
(b) materially modify the requirements as to
eligibility for participation in the Plan, or
(c) otherwise materially increase the benefits
accruing to participants under the Plan
shall be made without the approval of the Company's shareholders.
11.3 Effect of Termination or Suspension by the Company
Board. Any termination or suspension of the Plan by the Company
Board pursuant to Section 11.2 shall not affect Options already
granted and, except as otherwise provided herein in Section 10.2
and 10.4, such Options shall remain in full force and effect as
if this Plan had not been terminated or suspended. No Option may
be granted while the Plan is suspended or after it is terminated.
Except as provided in Sections 10.2 and 10.4, fights and
obligations under any Option granted while this Plan is in effect
shall not be altered or impaired by suspension or termination of
this Plan, except with the consent of the person to whom the
Option was granted. <PAGE B-7>
12. Conditions upon Issuance of Shares.
The Company shall not be required to issue any
certificate or certificates for Shares upon the exercise of an
Option granted under the Plan or to record as a holder of record
of Shares the name of the individual exercising an Option under
the Plan, without obtaining to the complete satisfaction of the
Company Board, the approval of all regulatory bodies deemed
necessary by the Company Board and without complying, to the
Company Board's complete satisfaction, with all rules and
regulations under federal, state, or local law deemed applicable
by the Company Board. Inability of the Company to obtain
authority from any regulatory body having jurisdictional
authority deemed by its counsel to be necessary to the lawful
issuance and sale of any Shares hereunder, or for the Company to
be in compliance with all rules, regulations and orders
applicable to it, shall relieve the Company of any liability in
respect to the non-issuance or sale of such Shares as to which
such requisite authority shall not have been obtained.
13. Reservation of Shares.
The Company, during the terms of this Plan, will at all
times reserve and keep available a number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
14. General Provisions.
14.1 No Additional Rights. The establishment of the
Plan shall not confer upon any Eligible Director any legal or
equitable right against the Company, the Bank or the Company
Board, except as expressly provided in the Plan.
14.2 No Contract. The Plan does not constitute
inducement for the service of any Eligible Director, nor is it a
contract between the Company and any Eligible Director or between
the Bank and any Eligible Director. Participation in the Plan
shall not give any Eligible Director any right to be retained in
the service of the Company or the Bank.
14.3 No Restrictions on Issuances of Other Shares and
Securities. Neither the adoption of this Plan, nor its
submission to the shareholders, shall be taken to impose any
limitations on the powers of the Company, its Subsidiaries or any
other of its or their affiliates to issue, grant, award or assume
stock or options, warrants or rights to purchase or receive
stock, otherwise than under this Plan, or to adopt other stock
plans or to impose any requirement of shareholder approval upon
the same.
14.4 Not Subject to Claims of Creditors. The interests
of any Eligible Director under the Plan are not subject to the
claims of creditors and may not, in any way, be assigned,
alienated or encumbered.
<PAGE B-8>
14.5 References to Statutes or Regulations. Any
reference contained in this Plan to a particular section or
provision of law, rule or regulations, including, but not limited
to, the Internal Revenue Code of 1986 and the Securities Exchange
Act of 1934, both as amended, shall include any subsequently
enacted or promulgated section or provision of law, rule or
regulation, a as the case may be, of similar import.
14.6 Persons Subject to Section 16. With respect to
persons subject to Section 16 of the Securities Exchange Act of
1934, as amended, transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3 or any
successor rule that may be promulgated by the Securities and
Exchange Commission, and to the extent any provision of this Plan
or action by the Company Board or any Committee designated by the
Company Board fails to so comply, it shall be deemed null and
void, to the extent permitted by applicable law and deemed
advisable by the Company Board or any Committee designated by the
Company Board.
14.7 Governing Law. The Plan shall be governed,
construed and administered in accordance with the laws of the
Commonwealth of Pennsylvania, without regard to the conflict of
laws principles thereof. <PAGE B-9>
