As filed with the Securities and Exchange Commission on March 31, 2000
Registration No. 333-
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
METROCORP BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
Texas 76-0579161
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9600 Bellaire Boulevard, Suite 252
Houston, Texas 77036
(713) 776-3876
(Address, including zip code, and telephone
number, including area code, of registrant's principal
executive offices)
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Ruth E. Ransom
Chief Financial Officer
MetroCorp Bancshares, Inc.
9600 Bellaire Boulevard, Suite 252
Houston, Texas 77036
(713) 776-3876
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copy to:
William T. Luedke IV
Bracewell & Patterson, L.L.P.
711 Louisiana, Suite 2900
Houston, Texas 77002
(713) 223-2900
Approximate date of commencement of proposed sale to the public: As soon as
possible after the effective date of this Registration Statement.
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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]
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. [ ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ] _____________
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] _____________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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TITLE OF EACH CLASS OF PROPOSED MAXIMUM PROPOSED MAXIMUM
SECURITIES TO BE AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF REGISTRATION
REGISTERED REGISTERED(1) SHARE(2) PRICE(2) FEE
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Shares of Common
Stock, $1.00 par value 700,000 $7.6875 $5,381,250 $1421
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(1) Plus such additional number of shares as may be required in the event of a
stock dividend, reverse stock split, split-up, recapitalization or other
similar event.
(2) Estimated solely for the purpose of computing the registration fee and
calculated pursuant to Rule 457(c) by multiplying the number of shares to
be registered by the average of the high and low prices of a share of
Common Stock as reported on The Nasdaq Stock Market, Inc. on March 27,
2000, which was $7.6875.
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PROSPECTUS
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METROCORP BANCSHARES, INC.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
700,000 SHARES OF COMMON STOCK
We are offering a maximum of 700,000 shares of our $1.00 par value common stock
issuable through our Dividend Reinvestment and Stock Purchase Plan, which was
adopted by our Board of Directors on January 28, 2000. The plan provides you
with an economical and convenient method of investing both cash dividends and
optional cash payments in additional shares of common stock without payment of
any brokerage commissions, service charges or other costs.
The price of the shares purchased with reinvested dividends and optional cash
payments, if any, will be the market price of the shares as determined under the
plan. Our stock is traded on The Nasdaq Stock Market, Inc. National Market
System under the symbol "MCBI".
We have selected American Stock Transfer & Trust Company to administer the plan.
Registered shareholders of the company may enroll in the plan by completing the
enclosed authorization card. A broker, bank or other nominee may reinvest cash
dividends and make optional cash payments on behalf of beneficial owners.
THIS PROSPECTUS SHOULD BE RETAINED FOR FUTURE REFERENCE.
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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.
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CASH DIVIDENDS, OPTIONAL CASH PAYMENTS AND SHARES OF COMMON STOCK PURCHASED
PURSUANT TO THE PLAN ARE NOT SAVINGS OR DEPOSIT ACCOUNTS AND ARE NOT INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE BANK INSURANCE FUND OR ANY OTHER
GOVERNMENTAL AGENCY.
THE DATE OF THIS PROSPECTUS IS MARCH 31, 2000
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WHERE YOU CAN FIND MORE INFORMATION
MetroCorp Bancshares, Inc. has filed with the Securities and Exchange
Commission a registration statement on Form S-3 to register the MetroCorp
Bancshares, Inc. common stock to be issued pursuant to the Dividend Reinvestment
and Stock Purchase Plan. As allowed by Commission rules, this prospectus does
not contain all the information you can find in the registration statement or
the exhibits thereto. The registration statement, including its exhibits and
schedules, contains additional relevant information about us and our common
stock. This prospectus is a part of the registration statement.
In addition to filing this registration statement with the Commission, we
file reports, proxy statements and other information with the Commission under
the Securities Exchange Act of 1934. You may read and copy the information at
the following locations of the Commission:
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Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, New York 10048 Suite 1400
Chicago, Illinois 60661-2511
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You may obtain information on the operation of the Public Reference Room by
calling the Commission at 1-800-SEC-0330. The Commission also maintains an
Internet world wide web site that contains reports, proxy statements and other
information about issuers, like MetroCorp Bancshares, Inc., who file
electronically with the Commission. The address of that site is
http://www.sec.gov.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Commission allows us to "incorporate by reference" the information we
file with it, which means that we can disclose important information to you by
referring to those documents. The information incorporated by reference is
considered to be an important part of this prospectus. In addition, information
that we file later with the Commission will automatically update and supersede
the information in this prospectus and incorporated by reference.
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We incorporate by reference the documents listed below and any future
filings made with the Commission under Sections 13(a), 14 or 15(d) of the
Securities Exchange Act of 1934 until we no longer issue securities under the
plan:
1. Our Annual Report on Form 10-K for the year ended December 31, 1999;
and
2. Our Registration Statement on Form 8-A filed with the Commission on
November 10, 1998, as updated in any amendment or report filed for that
purpose.
We will promptly furnish you, at no cost, a copy of any and all of the
information that we have incorporated by reference in this prospectus (without
exhibits, unless such exhibits are specifically incorporated by reference) upon
your oral or written request to:
Ruth E. Ransom
Chief Financial Officer
9600 Bellaire Boulevard, Suite 252
Houston, Texas 77036
(713) 776-3876
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METROCORP BANCSHARES, INC.
We are a Texas corporation and a bank holding company headquartered in
Houston, Texas. We conduct business through our subsidiary, MetroBank, N.A. We
operate in a niche market by addressing the banking needs of the Asian and
Hispanic communities in Houston and Dallas. We have fifteen full-service banking
offices located in areas with a large Asian or Hispanic community. We seek to
provide personalized, culturally sensitive service to small and medium-sized
businesses and consumers located in our market areas. Our principal lines of
business are commercial and industrial loans, commercial mortgage loans,
residential mortgage products, government guaranteed small business loans, trade
finance loans and letters of credit, and accounts receivable factoring. We also
offer a wide variety of loan and deposit products and services to consumers.
At December 31, 1999, we had total assets of $660.6 million, total loans of
$500.7 million, total deposits of $544.4 million and total shareholders' equity
of $52.6 million. Our principal executive offices are located at 9600 Bellaire
Boulevard, Suite 252, Houston, Texas 77036.
DESCRIPTION OF THE METROCORP BANCSHARES, INC. DIVIDEND REINVESTMENT
AND STOCK PURCHASE PLAN
On January 28, 2000, the Board of Directors of the company voted to adopt
this plan which provides for the issuance and sale by the company of authorized
but unissued and treasury shares of $1.00 par value common stock of the company
to shareholders of the company. The plan also provides for the purchase of the
company's common stock on the open market. The company has reserved 700,000
shares of its common stock for issuance and sale under the plan and pursuant to
this prospectus.
The following is a question and answer statement explaining the provisions
of the plan. A copy of the plan may be obtained from the company at 9600
Bellaire Boulevard, Suite 252, Houston, Texas 77036, Attention: Chief Financial
Officer. In the event of any conflict between the answers to these questions and
the plan, the more detailed provisions of the plan will control. Shareholders
who do not participate in the plan will continue to receive cash dividends, if,
when and as declared, in the usual manner.
PURPOSE
1. WHAT IS THE PURPOSE OF THE PLAN?
The purpose of the plan is to provide the shareholders of the company with
a simple and convenient method of investing cash dividends and optional cash
payments in
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additional shares of the common stock of the company without payment of any
brokerage commissions, service charges or other costs. The plan is intended to
benefit long-term investors who wish to increase their investment in the common
stock. To the extent that shares are purchased from the company rather than in
the open market, the plan will assist the company in raising funds for general
corporate purposes.
ADVANTAGES AND DISADVANTAGES TO PLAN PARTICIPANTS
2. WHAT ARE THE ADVANTAGES OF THE PLAN?
o REINVESTMENT. The plan permits you to reinvest cash dividends paid on
all or a portion of your shares in additional shares of common stock
without incurring any brokerage commission costs.
o FULL INVESTMENT. The plan permits you to acquire shares of the common
stock automatically. You may reinvest all cash dividends paid on your
shares because the plan allows you to purchase fractional shares.
Fractional shares will earn dividends in the same manner as whole
shares.
o COST SAVINGS. The plan provides you with the opportunity to make
additional voluntary cash contributions in amounts not less than $100
nor more than $5,000 during any dividend period, to purchase shares of
common stock, without the payment of service charges or brokerage
commissions.
o EASE OF RECORDKEEPING. Your recordkeeping will be simplified because
you will receive a detailed statement of your account, including the
cost basis of the shares purchased, after each investment is made.
o SAFEKEEPING. The plan administrator provides you with free safekeeping
services for the certificates representing the shares purchased and
credited to your account.
3. WHAT ARE THE DISADVANTAGES OF THE PLAN?
If you reinvest dividends paid on shares of common stock, you will be
treated for federal income tax purposes as having received a dividend but will
not receive cash to pay any tax payment obligations. In addition, because the
plan agent will generally purchase the shares of common stock for your benefit
at any time within thirty (30) days after an investment date, you will have
limited control regarding the specific timing of purchases of common stock made
for your accounts.
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ADMINISTRATION
4. WHO ADMINISTERS THE PLAN?
The plan will be administered by American Stock Transfer & Trust Company
(the "plan agent"). The plan agent also serves as the company's stock transfer
agent and registrar. The plan agent will keep records, send statements of
account to you and perform other duties related to the plan. The company may
adopt rules and regulations to facilitate administration of the plan and may
replace the plan agent at any time.
The plan agent may be contacted at:
American Stock Transfer & Trust Company
Dividend Reinvestment Department
40 Wall Street, 46th Floor
New York, New York 10005
(800) 278-4353
PARTICIPATION
5. WHO IS ELIGIBLE TO PARTICIPATE IN THE PLAN?
All holders of record of the common stock are eligible to participate in
the plan. A beneficial owner of common stock whose shares are registered in a
name other than his own must become a shareholder of record by having all or a
part of such shares transferred into his own name, or arrange for the holder of
record of such shares to enroll in the plan, in order to participate in the
plan.
6. HOW DOES AN ELIGIBLE SHAREHOLDER ENROLL IN THE PLAN?
You may enroll in the plan by completing and signing the authorization card
accompanying this prospectus and returning it to the plan agent. If your shares
are registered in more than one name (E.G., joint tenants or trustees), all
registered owners must sign the authorization card exactly as their names appear
on the account registration.
You may obtain additional authorization cards at any time by written or
oral request to the plan agent. Upon enrollment, your participation continues
automatically until you terminate it or until the plan is terminated by the
company.
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7. WHEN MAY AN ELIGIBLE SHAREHOLDER ENROLL IN THE PLAN?
You may enroll in the plan at any time. If your authorization card
requesting reinvestment of dividends is received by the plan agent on or before
the record date established for a particular dividend, reinvestment will
commence with that dividend. If the plan agent receives your authorization card
after the record date established for a particular dividend, the reinvestment of
dividends will begin with the dividend following the next record date, if you
are still a holder of record.
All optional cash payments received prior to an investment date will be
invested at that investment date. Optional cash payments made on or after an
investment date will be invested for the next investment date. (See Questions 10
through 12.)
8. WHAT DOES THE AUTHORIZATION CARD PROVIDE?
The authorization card allows you to determine the extent to which you want
to participate in the plan. You may invest your cash dividends in additional
shares of common stock by electing either one of the following investment
options:
o "FULL DIVIDEND REINVESTMENT" -- directs the plan agent to apply cash
dividends paid on all shares of common stock registered in your name
or which are held for you in your reinvestment account, together with
any optional cash payments, towards the purchase of additional shares
of common stock.
o "PARTIAL DIVIDEND REINVESTMENT" -- directs the plan agent to apply
cash dividends only with respect to the number of shares of common
stock you identify on the authorization card and with respect to any
additional shares of common stock held for you in your reinvestment
account, together with any optional cash payments, towards the
purchase of additional shares of common stock.
o "OPTIONAL CASH PAYMENTS ONLY" -- directs the plan agent to establish
an account for investment of your optional cash payments only, of not
less than $100 nor more than $5,000 per quarter. Such cash payments as
well as dividends received on the shares held in your reinvestment
account will be used to purchase additional shares of common stock.
You will continue to receive all cash dividends on the shares of
common stock registered in your name.
If you elect the dividend reinvestment option, you may also make optional
cash payments. If you elect the dividend reinvestment option, dividends will be
reinvested on all shares of common stock registered in your name, including
shares subsequently acquired. Whether or not you elect to reinvest dividends on
the shares registered in your name, all
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cash dividends paid on whole or fractional shares previously credited to your
plan account will be reinvested automatically.
9. MAY A PARTICIPANT CHANGE THE EXTENT OF HIS OR HER PARTICIPATION IN THE PLAN?
You may change your investment option under the plan at any time by
completing a new authorization card and returning it to the plan agent.
OPTIONAL CASH PAYMENTS
10. HOW CAN I MAKE OPTIONAL CASH PAYMENTS?
If you are a shareholder of record and submitted a signed authorization
card, you are eligible to make optional cash payments, whether or not you elect
to reinvest dividends. You may make optional cash payments to the plan of not
less than $100 and not more than $5,000 per quarter. The same amount need not be
invested in each quarter. You are under no obligation to make any optional cash
payments.
You may make an optional cash payment by forwarding a check or money order,
payable to the plan agent, with a completed authorization card when enrolling in
the plan. In addition, you may make an optional cash payment at any time if it
is accompanied by the optional cash payment form included with each statement of
your account.
Optional cash payments may only be made during a dividend period in which a
dividend is actually paid. If the company does not pay a dividend during any
dividend period, the plan agent will not purchase shares of common stock
pursuant to any optional cash payments.
11. WHEN WILL OPTIONAL CASH PAYMENTS BE INVESTED?
Optional cash payments are invested as of each dividend payment date
(normally January 15, April 15, July 15, and October 15) (the "investment
date"). The plan agent will apply any optional cash payment received from you
before the investment date to the purchase of common stock for your account on
the investment date. An optional cash payment will not be deemed to have been
made by you or received by the plan agent until the funds are actually
collected.
Interest will not be paid on optional cash payments. For this reason, it is
to your benefit to mail payments so that they are received by the plan agent
immediately prior to the next investment date.
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12. MAY OPTIONAL CASH PAYMENTS BE RETURNED TO A PARTICIPANT?
Yes. Optional cash payments will be returned to you upon written request to
the plan agent, provided that the request is received not later than 48 hours
prior to the next scheduled investment date.
Any optional cash payments in an amount less than the $100 minimum will be
returned. If an optional cash payment exceeds the $5,000 maximum, the excess
above $5,000 will be returned.
PURCHASES
13. WHAT IS THE SOURCE OF THE COMMON STOCK PURCHASED UNDER THE PLAN?
The plan agent may purchase shares of common stock for participants' plan
accounts by either:
o authorized but unissued shares or treasury shares of the company; or
o shares of common stock purchased in the open market. The source of
shares will be as determined by the company's board of directors. The
company will not exercise any direct or indirect control over the
prices or timing of purchases the plan agent makes.
14. HOW WILL THE PRICE OF SHARES PURCHASED UNDER THE PLAN BE DETERMINED?
The purchase price of common stock purchased directly from the company will
be the average of the high and low sales prices as reported on the Nasdaq
National Market System for a share of common stock on the day preceding the
relevant investment date. If no shares were traded on that day, the average of
the previous trading day's reported high and low sales prices will be used.
The purchase price of shares purchased on the open market will be the
weighted average cost per share (excluding brokerage commissions) to the plan
agent of such purchases for the applicable investment date.
15. HOW WILL THE NUMBER OF SHARES PURCHASED FOR EACH PARTICIPANT BE DETERMINED?
The number of shares to be purchased for you by the plan agent will equal
your total dollar amount to be invested divided by the applicable purchase
price. Fractional shares shall be calculated to three (3) decimal places.
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If you elect to reinvest dividends on common stock registered in your name,
your dollar amount to be invested as of any investment date will be the sum of:
o the dividend on all shares registered in your name;
o any optional cash payments to be invested as of the investment date; and
o the dividend on all whole or fractional shares of common stock
previously credited to your plan account.
If you elect to invest only optional cash payments, your dollar amount to
be invested as of any investment date will be the sum of:
o any optional cash payments to be invested as of the investment date; and
o the dividend on all whole or fractional shares of common stock
previously credited to your plan account.
16. WHEN WILL SHARES BE PURCHASED?
Shares of common stock may be purchased at any time but generally not later
than thirty (30) days after the investment date. Temporary suspension of
purchases may occur at any time when, in the judgment of the plan agent, the
purchase of shares would violate any governmental, judicial, securities exchange
or National Association of Securities Dealers, Inc. order. Dividend and voting
rights will commence upon settlement of the purchase. For the purposes of making
purchases, the plan agent will commingle your funds with those of all other
participants.
DIVIDENDS
17. HOW WILL DIVIDENDS BE PAID ON SHARES HELD IN PARTICIPANT ACCOUNTS?
As record holder of the shares held in participants' account under the
plan, the plan agent will receive dividends on all such shares held on each
record date, will credit such dividends to participants' accounts on the basis
of whole or fractional shares held in each account and will automatically
reinvest these dividends in shares of common stock.
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COSTS
18. WHAT ARE THE COSTS TO A PARTICIPANT IN THE PLAN?
You will incur no brokerage commissions, service charges or other expenses
for purchases of common stock made under the plan. We will pay all costs of
administration of the plan; however, you will be charged a fee when you withdraw
from the plan or request a share certificate.
REPORTS TO PARTICIPANTS
19. WHAT KIND OF REPORTS WILL BE SENT TO PARTICIPANTS?
As soon as practicable after common stock is purchased for your account,
the plan agent will send you a statement showing
o the amount of the dividend and optional cash payment, if any, applied
toward such investment,
o the taxes withheld, if any,
o the net amount invested,
o the number of shares purchased,
o the average cost per share,
o the total shares accumulated under the plan, computed to three (3)
decimal places,
o the cost basis of whole and fractional shares purchased, and
o the date of purchase.
You will receive annually an Internal Revenue Service Form 1099, or any
successor form, for the purpose of reporting dividend income received and other
relevant information.
In addition, you will receive the communications sent to every other holder
of common stock, including the company's Annual Report and Notice of Annual
Meeting and Proxy Statement.
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CERTIFICATES FOR SHARES
20. WILL CERTIFICATES BE ISSUED FOR SHARES PURCHASED?
No. All plan shares will be registered in the name of the plan agent or its
nominee, as agent for the participants. Certificates for shares purchased under
the plan ("plan shares") will be issued to you only if you request such
certificates in writing from the plan agent. Certificates for the number of
whole plan shares you specify will be issued to you normally within fifteen (15)
days of your signed written request. Any remaining whole or fractional plan
shares will continue to be held by the plan agent as your agent. Certificates
for fractional shares will not be issued under any circumstances.
Shares of common stock held in your plan account may not be pledged, sold
or otherwise transferred. If you want to pledge, sell or transfer your plan
shares, you must first request that a certificate for those shares be issued in
your name.
WITHDRAWAL OF SHARES IN PLAN ACCOUNTS
21. MAY I WITHDRAW SHARES HELD UNDER THE PLAN?
Yes. You may withdraw any number of whole shares held in your account by
requesting certificates for those shares as described in Question 20.
Withdrawing some but not all of your shares will not terminate your
participation in the plan.
22. WILL DIVIDENDS ON SHARES WITHDRAWN FROM THE PLAN CONTINUE TO BE REINVESTED?
If you authorized "Full Dividend Reinvestment" on your authorization
card, cash dividends on the shares withdrawn from the plan will continue to be
reinvested.
If you authorized "Partial Dividend Reinvestment" on your authorization
card, dividends will only be reinvested on the number of shares you specified on
your authorization card. You may change the number of shares on which dividends
are reinvested by completing a new authorization card specifying a different
number of shares.
VOTING RIGHTS
23. HOW WILL SHARES HELD BY THE PLAN AGENT BE VOTED?
For each meeting of shareholders, the company will send you a proxy
statement and form of proxy which covers both the shares registered in your name
and all shares,
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including fractional shares, credited to your plan account as of the record date
for the meeting.
STOCK DIVIDENDS, STOCK SPLITS, AND RIGHTS OFFERINGS
24. WHAT HAPPENS IF THE COMPANY DECLARES A STOCK DIVIDEND OR A STOCK SPLIT?
If there is a stock dividend or stock split, the plan agent will credit
your account with the applicable number of whole and/or fractional shares of
common stock based on the number of shares held in your plan account. Stock
dividends or split shares distributed with respect to shares of common stock
registered in your name will be mailed directly to you in the same manner as to
shareholders who do not participate in the plan.
25. WHAT HAPPENS IF THE COMPANY MAKES A RIGHTS OFFERING?
In the event of a rights offering by the company, the plan agent will sell
rights received with respect to plan shares held in your plan account, or in its
discretion, may distribute rights to participants. If the plan agent sells all
rights received with respect to plan shares, the plan agent will invest the
proceeds of such sales in additional shares of common stock, which will be
retained by the plan agent, as custodian, and credited proportionately to your
plan account. Participants who wish to exercise such rights must request the
plan agent to forward a share certificate to the participant (See Question 20
above). Such request must be made prior to the record date for exercising such
rights.
Rights on shares of common stock registered in your own name will be mailed
directly to you.
TERMINATION OF PARTICIPATION
26. HOW AND WHEN MAY A PARTICIPANT TERMINATE PARTICIPATION IN THE PLAN?
You may terminate your participation in the plan at any time by giving
written notice of termination to the plan agent. Any notice received less than
four (4) days prior to a record date shall not be effective until dividends and
other accumulated funds, if any, have been invested and credited to your
account.
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Within a reasonable time after termination, the plan agent will deliver to
you
o a certificate for all whole shares held under the plan,
o a check in lieu of the issuance of any fractional share in your
account, equal to the fractional share multiplied by the fair market
value per share of common stock, determined pursuant to the plan, on
the date that you terminate participation in the plan, and
o a check representing any uninvested optional cash payments.
You may be taxed on any cash received for a fractional share. See Question
29.
27. MAY A PARTICIPANT REQUEST THAT SHARES HELD IN HIS OR HER PLAN ACCOUNT BE
SOLD?
Yes. You may request that the plan agent sell all or part of the shares
held in your plan account. If all shares in the account are sold, the account
will be automatically terminated and you must complete a new authorization card
to again participate in the plan.
The shares will be sold by the plan agent at the market price of the common
stock on the date of sale, as soon as practicable after such request is received
by the plan agent. You will receive the proceeds of the sale, less any brokerage
commissions, applicable transfer tax and service charges of the plan agent.
AMENDMENT AND TERMINATION OF PLAN
28. MAY THE PLAN BE AMENDED, SUSPENDED OR TERMINATED?
Yes. The company may amend, supplement, suspend, modify or terminate the
plan at any time without the approval of the participants. To the extent
practicable, you will be sent notice thirty (30) days prior to the effective
date of any suspension, material amendment or termination and in all such
events, you have the right to withdraw from the plan. Participants who do not
withdraw from the plan before the effective date of an amendment will be deemed
to have accepted the amendment.
FEDERAL INCOME TAX CONSEQUENCES
29. WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF PARTICIPATING IN THE PLAN?
The following discussion summarizes the principal federal income tax
consequences, under current law, of participation in the plan. It does not
address all potentially relevant
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federal income tax matters, including consequences peculiar to persons subject
to special provisions of federal income tax law (such as tax-exempt
organizations, insurance companies, and foreign persons). The discussion is
based on various rulings of the Internal Revenue Service regarding several types
of dividend reinvestment plans. No ruling, however, has been issued or requested
regarding the plan. The following discussion is for your general information
only, and you are urged to consult your own tax advisor to determine the
particular tax consequences that may result from your participation in the plan
and in the disposition of any shares of common stock purchased pursuant to the
plan.
REINVESTED DIVIDENDS
Dividends that are reinvested to acquire shares of common stock will be
taxable to you (including any fractional share), as if you received the
dividends. For federal income tax purposes, you will have to report the receipt
of dividend income equal to the fair market value of the common stock purchased
with reinvested dividends. For example, if $100 of your dividends are reinvested
to purchase shares of common stock with a fair market value of $100, the total
amount of the dividend you will be treated as receiving for federal income tax
purposes will be $100.
The initial tax basis of shares of common stock you acquire with reinvested
dividends will equal the amount of the dividend you are treated as having
received for tax purposes. Consequently, your initial basis in a share acquired
with reinvested dividends will be the share's purchase price. The holding period
for shares of common stock acquired with reinvested dividends will begin the day
after the date the shares are purchased for you. A whole share resulting from
the acquisition of two or more fractional shares on different dates will have a
split holding period, with the holding period for each fractional component
beginning the day after the purchase date when the fraction was acquired.
The foregoing discussion is based on the assumption that newly issued or
treasury shares will be purchased from the company. If the shares are purchased
on the open market, the payment of the applicable brokerage commissions by the
company in connection with such purchases will be treated as additional dividend
income to the participants and will increase the tax basis of those shares.
OPTIONAL CASH PAYMENTS
The purchase of shares of common stock under the plan with your optional
cash payments will not be considered a taxable dividend. The initial tax basis
in shares of common stock acquired with an optional cash payment will be the
purchase price. The holding period for shares acquired with optional cash
payments under the plan will begin the day after the purchase date. A share
consisting of fractional shares purchased on
15
<PAGE>
different dates will have a split holding period, with the holding period for
each fractional component beginning the day after its purchase date.
RECEIPT OF SHARE CERTIFICATES AND CASH
You will not realize any income when you receive certificates for whole
shares credited to your account under the plan. Any cash received for a
fractional share held in your account will be treated as an amount realized on
the sale of the fractional share. You therefore will recognize gain or loss
equal to any difference between the amount of cash received for a fractional
share and your tax basis in the fractional share.
OTHER INFORMATION
30. WHO SHOULD BE CONTACTED WITH QUESTIONS CONCERNING THE PLAN?
All inquiries concerning the plan should be directed to:
American Stock Transfer & Trust Company
Dividend Reinvestment Department
40 Wall Street, 46th Floor
New York, New York 10005
(800) 278-4353
31. WHO WILL INTERPRET THE PROVISIONS OF THE PLAN?
Any question of interpretation arising under the plan will be determined by
the company pursuant to applicable federal and state law and the rules and
regulations of all regulatory authorities, and such determination shall be final
and binding on all participants and the plan agent.
32. WHO BEARS THE RISK OF MARKET FLUCTUATIONS IN THE COMMON STOCK?
A participant's investment in shares held in his or her account is no
different from investment in shares held directly. The participant bears all
risk of loss and has the opportunity for gain from market price changes in the
common stock.
16
<PAGE>
RESPONSIBILITY OF THE COMPANY AND THE PLAN AGENT
33. WHAT ARE THE RESPONSIBILITIES OF THE COMPANY AND THE PLAN AGENT WITH
RESPECT TO THE PLAN?
Neither the company nor the plan agent shall be liable for any act done in
good faith, or for any good faith omission to act, including, without
limitation, any claim or liability arising out of failure to terminate a
participant's account upon such participant's death prior to receipt of written
notice of the death, the prices at which shares are purchased, the times when
purchases or sales are made or any inability to purchase or sell common stock
for any reason, or should recognize fluctuations in the market value of the
common stock.
The participants should realize that neither the company nor the plan agent
can provide any assurance of a profit or protection against loss on any shares
purchased under the plan.
USE OF PROCEEDS
The net proceeds from the sale of the newly issued common stock or treasury
shares of common stock offered pursuant to the plan will be used by the company
for general corporate purposes.
PLAN OF DISTRIBUTION
The common stock being sold under the plan is being distributed directly by
us rather than through an underwriter, broker or dealer. You will not be charged
any brokerage commissions or other fees for shares you purchase under the plan.
Upon the sale of shares of common stock held under the plan, you will receive
the proceeds of the sale, less any brokerage commissions, applicable transfer
tax and service charges of the plan agent. See Question 27.
INDEMNIFICATION
The company's Articles of Incorporation and Bylaws require the company to
indemnify officers and directors of the company to the fullest extent permitted
by Article 2.02-1 of the Business Corporation Act of the State of Texas (the
"TBCA"). Generally, Article 2.02-1 of the TBCA permits a corporation to
indemnify a person who was, is, or is threatened to be made a named defendant or
respondent in a proceeding because the person was or is a director or officer if
it is determined that such person (i) conducted himself in good faith, (ii)
reasonably believed (a) in the case of conduct in his official capacity as a
director or officer of the corporation, that his conduct was in the
corporation's best interests, or (b) in other cases, that his conduct was at
least not opposed to the corporation's best interests, and (iii) in the case of
any criminal proceeding, had no reasonable cause to believe that his conduct was
unlawful. In addition, the TBCA requires a corporation to indemnify a director
or officer for any action that such director or officer is wholly successfully
in defending on the merits.
17
<PAGE>
The company's Articles of Incorporation provide that a director of the
company will not be liable to the corporation for monetary damages for an act or
omission in the director's capacity as a director, except to the extent not
permitted by law. Texas law does not permit exculpation of liability in the case
of (i) a breach of the director's duty of loyalty to the corporation or its
shareholders, (ii) an act or omission not in good faith that constitutes a
breach of duty of the director to the corporation or an act or omission that
involves intentional misconduct or a knowing violation of the law, (iii) a
transaction from which a director received an improper benefit, whether or not
the benefit resulted from an action taken within the scope of the director's
office or (iv) an act or omission for which the liability of the director is
expressly provided by statute.
The company may provide liability insurance for each director and officer
for certain losses arising from claims or charges made against them while action
in their capabilities as directors or officers of the company, whether or not
the company would have the power to indemnify such person against such
liability, as permitted by law.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
registrant pursuant to the foregoing provisions, the registrant has been
informed 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.
EXPERTS
The consolidated financial statements of the company for the years ended
December 31, 1998 and 1997 incorporated in this prospectus and Registration
Statement by reference to the company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1999 have been audited by PricewaterhouseCoopers
LLP, independent accountants, as stated in their report with respect thereto,
and are incorporated herein by reference in reliance upon such report given upon
their authority as experts in accounting and auditing.
The consolidated financial statements of the company for the year ended
December 31, 1999 incorporated in this prospectus and Registration Statement by
reference to the company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1999 have been audited by Deloitte & Touche LLP, independent
auditors, as stated in their report with respect thereto, and are incorporated
by reference in reliance upon such report given upon their authority as experts
in accounting and auditing.
LEGAL MATTERS
The validity of the common stock offered hereby has been passed upon for
the company by Bracewell & Patterson, L.L.P., Houston, Texas.
18
<PAGE>
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. THE
COMPANY HAS NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. IF
ANYONE PROVIDES YOU WITH DIFFERENT OR INCONSISTENT INFORMATION, YOU SHOULD NOT
RELY ON IT. WE ARE NOT MAKING AN OFFER TO SELL THESE SECURITIES IN ANY STATE
WHERE THE OFFER OR SALE IS NOT PERMITTED.
YOU SHOULD ASSUME THAT THE INFORMATION APPEARING IN THIS PROSPECTUS OR THE
DOCUMENTS INCORPORATED BY REFERENCE ARE ACCURATE AS OF THE DATE ON THE FRONT
COVER OF THIS PROSPECTUS OR THOSE DOCUMENTS ONLY.
------------------------
SUMMARY TABLE OF CONTENTS
Page
----
Where You Can Find More
Information........................ 2
Incorporation of Certain Information
by Reference....................... 2
Description of the MetroCorp
Bancshares, Inc. Dividend
Reinvestment and Stock Purchase
Plan............................... 4
Use of Proceeds...................... 17
Plan of Distribution................. 17
Indemnification...................... 17
Experts.............................. 18
Legal Matters........................ 18
700,000 SHARES
[LOGO]
METROCORP BANCSHARES, INC.
COMMON STOCK
($1.00 PAR VALUE)
---------------------------------
PROSPECTUS
---------------------------------
DIVIDEND REINVESTMENT
AND STOCK PURCHASE PLAN
MARCH 31, 2000
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following is an estimate of all expenses expected to be incurred by the
Registrant in connection with the issuance and distribution of the securities
registered hereby:
Securities and Exchange Commission registration fee .... $ 1,421
Transfer agent fees .................................... 4,000
Printing expenses ...................................... 1,500
Legal fees and expenses of counsel for Registrant ...... 10,000
Accounting fees and expenses ........................... 2,500
Miscellaneous .......................................... 579
-------
TOTAL .................................... $20,000
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
MetroCorp's Articles of Incorporation and Bylaws require MetroCorp to indemnify
officers and directors of MetroCorp to the fullest extent permitted by Article
2.02-1 of the Business Corporation Act of the State of Texas (the "TBCA").
Generally, Article 2.02-1 of the TBCA permits a corporation to indemnify a
person who was, is, or is threatened to be made a named defendant or respondent
in a proceeding because the person was or is a director or officer if it is
determined that such person (i) conducted himself in good faith, (ii) reasonably
believed (a) in the case of conduct in his official capacity as a director or
officer of the corporation, that his conduct was in the corporation's best
interests, or (b) in other cases, that his conduct was at least not opposed to
the corporation's best interests, and (iii) in the case of any criminal
proceeding, had no reasonable cause to believe that his conduct was unlawful. In
addition, the TBCA requires a corporation to indemnify a director or officer for
any action that such director or officer is wholly successfully in defending on
the merits.
MetroCorp's Articles of Incorporation provide that a director of MetroCorp will
not be liable to the corporation for monetary damages for an act or omission in
the director's capacity as a director, except to the extent not permitted by
law. Texas law does not permit exculpation of liability in the case of (i) a
breach of the director's duty of loyalty to the corporation or its shareholders,
(ii) an act or omission not in good faith that constitutes a breach of duty of
the director to the corporation or an act or omission that involves intentional
misconduct or a knowing violation of the law, (iii) a transaction from which a
director received an improper benefit, whether or not the benefit resulted from
an action taken within the scope of the director's office or (iv) an act or
omission for which the liability of the director is expressly provided by
statute.
MetroCorp may provide liability insurance for each director and officer for
certain losses arising from claims or charges made against them while action in
their capabilities as directors or officers of MetroCorp, whether or not
MetroCorp would have the power to indemnify such person against such liability,
as permitted by law.
<PAGE>
ITEM16. EXHIBITS
The following documents are filed as exhibits to this Registration Statement:
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
5.1 Opinion of Bracewell & Patterson, L.L.P. as to the legality of the
securities being registered
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of Bracewell & Patterson, L.L.P. (included in the opinion
filed as Exhibit 5.1)
24.1 Powers of Attorney (included on page II-3).
99.1 MetroCorp Bancshares, Inc. Dividend Reinvestment and Stock Purchase
Plan.
ITEM 17. 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:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(b) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high and of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price
represent no more than 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.
(c) 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.
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) of this
section do not apply if the registration statement is on Form S-3, Form
S-8 or Form F-3, and the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic reports
filed with or furnished to the Commission by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference n the registration statement.
(2) 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.
(3) 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.
II-2
<PAGE>
B. 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 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.
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 FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION STATEMENT
TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE
CITY OF HOUSTON, STATE OF TEXAS, ON MARCH 31, 2000.
MetroCorp Bancshares, Inc.
(Registrant)
By: /s/ DON J. WANG
Don J. Wang
Chairman of the Board and President
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints Don J.
Wang or Ruth E. Ransom with full power to each of them to act without the other,
as the undersigned's true and lawful attorney-in-fact and agent, with full power
of substitution and resubstitution, for the undersigned and in the undersigned's
name, place and stead, in any and all capacities (until revoked in writing), to
sign this Registration Statement and any and all amendments (including post-
effective amendments) thereto, to file the same, together with all exhibits
thereto and documents in connection therewith, with the Securities and Exchange
Commission, to sign any and all applications, registration statements, notices
and other documents necessary or advisable to comply with the applicable state
securities authorities, granting unto said attorney- in-fact and agent, or his
or their substitute or substitutes, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in order to
effectuate the same as fully to all intents and purposes as the undersigned
might or could do if personally present, thereby ratifying and confirming all
that said attorneys-in-fact and agents, or his 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 BY THE FOLLOWING PERSONS IN THE CAPACITIES INDICATED
ON MARCH 31, 2000.
SIGNATURE TITLE
/s/ DON J. WANG Chairman of the Board and President
Don J. Wang (principal executive officer)
/s/ RUTH E. RANSOM Senior Vice President and Chief Financial Officer
Ruth E. Ransom (principal financial officer and principal
accounting officer)
/s/ TOMMY F. CHEN Director
Tommy F. Chen
II-3
<PAGE>
/s/ HELEN F. CHEN Director
Helen F. Chen
/s/ MAY P. CHU Director
May P. Chu
/s/ JANE W. KWAN Director
Jane W. Kwan
/s/ GEORGE M. LEE Director
George M. Lee
/s/ JOHN LEE Director
John Lee
/s/ DAVID TAI Director
David Tai
/s/ JOE TING Director
Joe Ting
II-4
<PAGE>
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
5.1 Opinion of Bracewell & Patterson, L.L.P. as to the legality of the
securities being registered
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of Bracewell & Patterson, L.L.P. (included in the opinion
filed as Exhibit 5.1)
24.1 Powers of Attorney (included on page II-3).
99.1 MetroCorp Bancshares, Inc. Dividend Reinvestment and Stock Purchase
Plan.
II-5
EXHIBIT 5.1
[BRACEWELL & PATTERSON L.L.P. LETTERHEAD]
March 31, 2000
MetroCorp Bancshares, Inc.
9600 Bellaire Boulevard, Suite 252
Houston, Texas 77036
Ladies and Gentlemen:
We have acted as counsel to MetroCorp Bancshares, Inc., a Texas corporation (the
"Company"), in connection with the registration and proposed issuance of up to
700,000 shares (the "Shares") of its common stock, par value $1.00 per share
(the "Common Stock") in connection with the MetroCorp Bancshares, Inc. Dividend
Reinvestment and Stock Purchase Plan (the "Plan"). The Company is filing with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended, a Registration Statement on Form S-3 relating to the
Shares (the "Registration Statement").
We have examined originals or copies of (1) the Registration Statement; (2) the
Articles of Incorporation of the Company, as amended; (3) the Bylaws of the
Company, as amended; (4) certain resolutions of the Board of Directors of the
Company; and (5) such other documents and records as we have deemed necessary
and relevant for purposes hereof. In addition, we have relied upon certificates
of officers of the Company and telegrams of public officials as to certain
matters of fact relating to this opinion and have made such investigations of
law as we have deemed necessary and relevant as a basis hereof. In such
examination, we have assumed the genuineness of all signatures, the authenticity
of all documents, certificates and records submitted to us as originals, the
conformity to original documents, certificates and records of all documents,
certificates and records submitted to us as copies, and the truthfulness of all
statements of fact contained therein.
In rendering our opinion, we have assumed that any previously issued shares of
Common Stock reacquired by the Company and reissued and sold under the Plan were
duly authorized, validly issued and fully paid at the time of their original
issuance.
Based on the foregoing, and subject to the limitations set forth herein, and
having due regard for such legal considerations as we deem relevant, we are of
the opinion that the Shares have
<PAGE>
MetroCorp Bancshares, Inc.
March 30, 2000
Page 2
been duly and validly authorized and when issued and paid for in accordance with
the terms of the Plan, for a consideration at least equal to the par value
thereof, the Shares will be validly issued, fully paid and nonassessable.
The foregoing opinion is based on and is limited to the law of the State of
Texas and the relevant law of the United States of America, and we render no
opinion with respect to the laws of any other jurisdiction.
We hereby consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement and to the use of our
name therein. By giving such consent, we do not admit that we are experts with
respect to any part of the Registration Statement, including this Exhibit within
the meaning of the term "expert" as used in the Securities Act of 1933, as
amended, or the rules and regulations thereunder.
Very truly yours,
/s/ BRACEWELL & PATTERSON, L.L.P.
Bracewell & Patterson, L.L.P.
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
MetroCorp Bancshares, Inc. on Form S-3 of our report dated February 4, 2000,
appearing in the Annual Report on Form 10-K of MetroCorp Bancshares, Inc. for
the year ended December 31, 1999 and to the reference to us under the heading
"Experts" in the Prospectus, which is part of this Registration Statement.
DELOITTE & TOUCHE LLP
/s/ Deloitte & Touche LLP
Houston, Texas
March 30, 2000
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated March 19, 1999 relating to the
financial statements which appear in MetroCorp Bancshares, Inc.'s Annual Report
on Form 10-K for the year ended December 31, 1998. We also consent to the
reference to us under the heading "Experts" in such Registration Statement.
/s/ PricewaterhouseCoopers
Houston, Texas
March 29, 2000
EXHIBIT 99.1
METROCORP BANCSHARES, INC.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
1. PURPOSE OF THE PLAN
The purpose of this Dividend Reinvestment and Stock Purchase Plan (the "Plan")
is to provide the participating shareholders of MetroCorp Bancshares, Inc. (the
"Company") with an economical and convenient method of investing both cash
dividends and optional cash payments in additional shares of the Common Stock of
the Company without payment of any brokerage commissions, service charges or
other costs.
2. DEFINITIONS
For purposes of the Plan, the following words or phrases shall have meanings
assigned to them below:
A. "Authorization Card" shall mean the card or other document
designated by the Plan Agent as the required evidence of a
shareholder's election to participate in the Plan.
B. "Bank" shall mean MetroBank, N.A.
C. "Common Stock" shall mean the $1.00 par value Common Stock of the
Company.
D. "Company" shall mean MetroCorp Bancshares, Inc.
E. "Dividend Reinvestment Committee" shall mean the committee so
designated by the Board of Directors of the Company. The Dividend
Reinvestment Committee shall be composed of at least three (3)
persons, one of whom shall be the chief executive officer of the
Company.
F. "Employee" shall mean an employee of the Bank or the Company.
G. "Fair Market Value" shall mean the value of the Common Stock
determined by the Dividend Reinvestment Committee as follows:
(i) During such time as the Common Stock is listed on an
established stock exchange or exchanges, the fair market value
shall be deemed to be the closing price of the Common Stock on
the stock exchange(s) on the applicable date or, if no sale of
the Common Stock has been made on any exchange on that day,
the fair market value shall be determined by reference to such
prices on the next preceding day on which Common Stock was
traded.
<PAGE>
(ii) During such time as the Common Stock is not listed on an
established stock exchange but is listed on the Nasdaq
National Market, the fair market value per share shall be the
average of the highest and lowest trading prices for the
Common Stock on the applicable date or, if no trade of Common
Stock occurred on that day, the fair market value shall be
determined by reference to such price on the next preceding
day on which the Common Stock was traded.
(iii) During such time as the Common Stock is not listed on an
established stock exchange or on the Nasdaq National Market
but is quoted by Nasdaq, the fair market value per share shall
be the average of the closing dealer "bid" and "ask" prices
for the Common Stock, as quoted by Nasdaq for the applicable
day or, if no "bid" and "ask" prices are quoted for that day,
the fair market value shall be determined by reference to such
prices on the next preceding day on which such prices were
quoted.
(iv) During such time as the Common Stock is not listed on an
established stock exchange or quoted by Nasdaq, the fair
market value per share shall be the average of the lowest
"bid" and highest "ask" quotations of the Common Stock on the
applicable date, as reported by one or more brokerage firms
which then make a market in the Common Stock or, in the
absence of either a "bid" or "ask" quotation, the quotation
(or average of the quotations, if several) reported on the
applicable date, whether "bid" or "ask".
(v) In the event the Common Stock is not traded on an established
stock exchange or quoted by Nasdaq and no "bid" and "ask"
prices are available or if, in the determination of the
Dividend Reinvestment Committee, the value determined pursuant
to subparagraph 4 above does not accurately reflect the fair
market value of the Common Stock, the fair market value of the
Common Stock shall be as determined in good faith by the
Dividend Reinvestment Committee.
H. "Investment Date" shall mean the date a dividend is actually paid by
the Company.
I. "Participant" shall mean a holder of Common Stock of the Company who
has elected to participate in the Plan by delivering an executed
Authorization Card to the Plan Agent.
J. "Plan" shall mean this Dividend Reinvestment and Stock Purchase
Plan.
K. "Plan Agent" shall mean American Stock Transfer & Trust Company and
shall also mean any other entity to which the Plan Agent has
delegated all or any part of its responsibilities hereunder, with
the exception of purchasing Plan Shares pursuant to the Plan.
-2-
<PAGE>
L. "Plan Shares" shall mean shares of Common Stock that have been
purchased by a Participant under the Plan and which are held by the
Plan Agent in a custodial account.
M. "Purchasing Agent" shall mean any entity designated by the Plan
Agent to purchase Plan Shares for the Participants.
N. "Record Date" shall mean the date on which a person must be
registered as a shareholder on the stock books of the Company in
order to receive a dividend.
3. ADMINISTRATION
The Plan shall be administered by the Plan Agent, however, the purchase of Plan
Shares may be delegated to an unaffiliated third party (the "Purchasing Agent").
All Plan Shares will be registered in the name of the Plan Agent (or its
nominee) as agent for the Participants. The Plan Shares will be credited to the
accounts of the respective Participants as their interest may appear.
4. PARTICIPATION
Subject to the provisions of Sections 4, 5, and 17 herein, all holders of record
of the Common Stock of the Company are eligible to participate in the Plan. A
beneficial owner whose shares are registered in a name other than his own must
first become a shareholder of record by having all or a part of such shares
transferred into his own name, or arrange for the holder of record of such
shares to enroll in the Plan, in order to participate in the Plan.
The Company reserves the right not to offer participation in the Plan to those
holders of record who reside in jurisdictions which require (i) registration or
qualification of the Common Stock to be issued pursuant to the Plan with the
securities commission of that jurisdiction, or (ii) registration or
qualification of the Company or the Plan Agent, or any of their respective
officers or employees, as a broker, dealer, salesman or agent.
5. ENROLLMENT
A shareholder of record may enroll in the Plan at any time, unless (i) the Plan
Agent or any Purchasing Agent has reason to believe that such enrollment is not,
at such time, permitted under the laws of the jurisdiction in which such
shareholder resides or under the laws of the United States, or (ii) the Plan is
suspended or terminated as hereinafter provided, by completing and signing an
Authorization Card and returning it to the Plan Agent. If an Authorization Card
requesting reinvestment of dividends is received by the Plan Agent on or before
the Record Date established for a particular dividend, reinvestment will
commence with that dividend. If an Authorization Card is received from a
shareholder after the Record Date established for a particular dividend, the
reinvestment of dividends will begin on the Investment Date following the next
Record Date if the shareholder is still a holder of record.
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<PAGE>
A shareholder who elects to enroll in the Plan may participate with respect to
some, but not all shares of Common Stock owned of record by that shareholder.
Once a shareholder has enrolled in the Plan, his participation continues with
respect to his participating shares until terminated by such shareholder or
until the Plan is terminated by the Company.
6. OPTIONAL CASH PAYMENTS
Each Participant may make optional cash payments to the Plan of not less than
$100.00 nor more than $5,000.00 during any single dividend period. Participants
need not invest the same amounts during each dividend period. Participants are
under no obligation to make any optional cash payments.
An optional cash payment shall be made by forwarding a check or money order,
payable to the Plan Agent, with a completed Authorization Card when enrolling in
the Plan, or thereafter, accompanied by the transmittal form for mailing
optional cash payments that will be included with each statement of account
furnished to Participants pursuant to Section 11 hereof. The Plan Agent will
apply each optional cash payment received from a Participant before an
Investment Date to the purchase of Common Stock for the account of that
Participant on the next Investment Date. An optional cash payment will not be
deemed to have been made by a Participant or received by the Plan Agent until
the funds contributed are actually collected.
Interest will not be paid on optional cash payments. Optional cash payments will
be returned to a Participant upon written request to the Plan Agent, provided
that the request is received not later than 48 hours prior to the next scheduled
Investment Date.
An optional cash payment in an amount less than $100.00 will be returned to the
Participant. If an optional cash payment exceeds $5,000.00, the excess amount
above $5,000.00 will be returned to the Participant.
Optional cash payments may only be made during a dividend period in which a
dividend is actually paid. If the Company does not pay a dividend during any
dividend period, the Plan Agent will not purchase shares of Common Stock
pursuant to any optional cash payments received for that dividend period.
7. PURCHASES
On each Investment Date, the Company will pay to the Plan Agent the total amount
of dividends payable on each Participant's shares of Common Stock enrolled in
the Plan (including Plan Shares) and, except as otherwise directed by the
Company, the Plan Agent shall use that amount, in addition to the Participant's
optional cash payments, if any, for either, as directed by the Company:
(i) the purchase from the Company out of the Company's authorized but
unissued shares or treasury shares of Common Stock, such number of
shares of Common Stock as the Company is then willing to sell to the
Plan Agent for purposes of investing such dividends in Company
Common Stock; or
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(ii) the purchase of shares of Company Common Stock in the open market,
which purchases may be made from time to time after the dividend
payment date but shall be made no later than thirty (30) days after
the Investment Date.
The purchase price of shares of Common Stock purchased directly from the Company
will be the average of the high and low sales prices as reported on the Nasdaq
National Market System for a share of Common Stock on the day preceding the
relevant Investment Date. If no shares were traded on that day, the previous
trading day's reported high and low sales prices will be used.
The price of shares purchased on the open market will be the weighted average
cost per share (excluding brokerage commissions) to the Plan Agent of such
purchases for the applicable Investment Date.
Purchases will be made as soon as possible after the applicable Investment Date,
but no more than thirty (30) days after such date. No Common Stock will be
allocated to a Participant's account until the date on which the Plan Agent has
purchased sufficient shares of Common Stock to cover purchases for all
Participants in the Plan. If purchases occur at different prices, the purchase
price per share of Common Stock to all Participants will be based upon the
average of the prices of all shares of Common Stock purchased.
Each Participant's account will be credited with the number of whole and
fractional shares (calculated to three (3) decimal places) equal to the amount
to be invested divided by the applicable purchase price.
8. TEMPORARY CURTAILMENT OF PURCHASES OR SALES
Temporary curtailment or suspension of purchases or sales of shares may be made
at any time when such purchases or sales would, in the judgment of the Plan
Agent, contravene or be restricted by applicable regulations, interpretations or
orders of the Securities and Exchange Commission, or any other governmental
commission, agency or instrumentality, of any court or securities exchange or of
the National Association of Securities Dealers, Inc. The Plan Agent shall not be
accountable or otherwise liable for failure to make purchases or sales at such
times.
9. DIVIDENDS ON PLAN SHARES
As record holder of the Plan Shares held in Participants' accounts under the
Plan, the Plan Agent will receive dividends on all Plan Shares held on each
dividend record date, will credit such dividends to Participants' accounts on
the basis of whole or fractional shares held in each account and will
automatically reinvest these dividends in the Common Stock of the Company.
10. COSTS
All brokerage commissions for purchases of Common Stock and costs of
administration of the Plan will be borne by the Company; however, a reasonable
service charge may be assessed at the time of a Participant's withdrawal from
the Plan or at any time a Participant requests that he be issued a share
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certificate. Participants will be charged the full actual cost, including any
brokerage commissions, of all shares of Common Stock sold upon a Participant's
request from such Participant's account.
11. REPORTS TO PARTICIPANTS
As soon as practicable after completion of each investment on behalf of a
Participant, the Plan Agent will mail to such Participant a statement of account
showing:
(i) the amount of the dividend and optional cash payment, if any,
applied toward such investment,
(ii) the taxes withheld, if any,
(iii) the net amount invested,
(iv) the number of shares purchased,
(v) the average cost per share,
(vi) the total shares accumulated under the Plan, computed to three (3)
decimal places,
(vii) the cost basis of whole and fractional shares purchased, and
(viii) the date of purchase.
Each Participant will receive annually Internal Revenue Service Form 1099, or
any successor form, for the purpose of reporting dividend income received and
other relevant information.
12. VOTING OF SHARES
For each meeting of shareholders, the Company will send each Participant a proxy
statement and form of proxy for the purpose of voting all shares registered in
that Participant's name and all Plan Shares, including fractional shares. The
Plan Shares of a Participant who does not return a proxy will not be voted.
13. CERTIFICATES FOR SHARES
All Plan Shares will be registered in the name of the Plan Agent or its nominee,
as agent for the Participants. Certificates for Plan Shares will not be issued
to Participants unless requested in writing. Certificates for any number of
whole Plan Shares will be issued to a Participant within fifteen (15) days of a
written request to the Plan Agent signed by the Participant. A reasonable fee
may be charged for each certificate requested. Any remaining whole or fractional
Plan Shares will continue to be held by the Plan Agent as the agent for the
Participant. Certificates for fractional shares will not be issued under any
circumstances.
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Certificates will, however, be issued to Participants upon withdrawal of Plan
Shares or upon termination of participation in the Plan. Certificates will be
registered in the name or names in which the Participant's account is
maintained.
A Participant may not pledge, sell or otherwise transfer shares held in the
Plan. In order to pledge, sell or otherwise transfer Plan Shares, the
Participant must request a certificate for those shares from the Plan Agent.
14. TERMINATION OF ACCOUNT AND WITHDRAWALS
TERMINATION
A Participant may terminate his account at any time by giving written notice of
termination to the Plan Agent, however, any notice received less than four (4)
days prior to a Record Date shall not be effective until dividends and other
accumulated funds, if any, have been invested and credited to the Participant's
account. The Plan Agent may terminate any account by written notice to the
Participant.
Within a reasonable time after termination, the Plan Agent will deliver to the
Participant:
(i) a certificate for all whole Plan Shares held under the Plan;
(ii) a check in lieu of the issuance of a fractional share equal to the
fractional Plan Share multiplied by the Fair Market Value per share
of the Common Stock on the date of termination; and
(iii) a check for any uninvested optional cash payments.
The Participant shall have no right to draw checks or drafts against his account
or to give instructions to the Plan Agent with respect to any Plan Shares or
cash held in the Participant's account except as expressly provided in the Plan.
The Participant will be charged a reasonable fee for issuance of the
certificate.
WITHDRAWALS
A Participant may withdraw any number of whole Plan Shares credited to his
account by requesting a certificate for those shares. A withdrawal of some but
not all Plan Shares does not automatically terminate participation in the Plan
unless written notice of such termination is provided as described above.
If a Participant authorized "Full Dividend Reinvestment" on the Authorization
Card, cash dividends received on the shares which were withdrawn from the Plan
will continue to be reinvested. If a Participant authorized "Partial Dividend
Reinvestment", dividends will be reinvested only on the number of shares the
Participant specified on the Authorization Card.
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15. DISPOSITION OF SHARES
If a Participant disposes of all shares of Common Stock registered in his name
other than shares under the Plan, the Plan Agent will, unless otherwise
instructed by the Participant, continue to reinvest the dividends on the shares
still credited to the Participant's account under the Plan. However, if a
Participant, has only a fractional share of Common Stock credited to his account
under the Plan on the Record Date for any cash dividend on the Common Stock, the
Company reserves the right not to reinvest any additional dividends on such
fractional share and pay the Participant in cash for such fractional share and
any dividend thereon. The cash payment for the fractional share will be based
upon the average of the high and low sales prices of a share of Common Stock as
reported by the Nasdaq National Market for the business day prior to the date
the Company elects to make such cash payment to the Participant.
16. STOCK DIVIDENDS; STOCK SPLITS; RIGHTS OFFERINGS
Any stock dividends or split shares distributed by the Company with respect to
the Plan Shares of a Participant will be added to his Plan account as additional
Plan Shares. Stock dividends or split shares distributed with respect to shares
of Common Stock registered in a Participant's name will be mailed directly to
the Participant in the same manner as to shareholders who do not participate in
the Plan.
In the event of a rights offering by the Company, the Plan Agent may either sell
all rights received with respect to Plan Shares held of record by the Plan Agent
as custodian, or, in its discretion, may distribute rights to Participants. If
the Plan Agent sells all rights received with respect to Plan Shares, the Plan
Agent will invest the proceeds of such sales in additional shares of Common
Stock, which will be retained by the Plan Agent as custodian and credited
proportionately to the accounts of the Participants. Participants who wish to
exercise rights with respect to Plan Shares must request the Plan Agent to
forward a share certificate to the Participant as provided in Section 13 of the
Plan. Such request must be made prior to the record date for exercising such
rights. Rights on shares of Common Stock registered in the name of a Participant
will be mailed directly to the Participant.
17. AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN
The Company may amend, supplement, suspend, modify or terminate the Plan at any
time without the approval of the Participants. To the extent practicable, thirty
(30) days notice of any suspension, material amendment or termination shall be
sent to all Participants, who shall in all events have the right to withdraw
from the Plan. Participants who do not withdraw from the Plan prior to the
effective date of an amendment will be deemed to have accepted the amendment.
18. INTERPRETATION OF THE PLAN
Any question of interpretation arising under the Plan will be determined by the
Board of Directors of the Company pursuant to applicable federal and state law
and the rules and regulations of all regulatory authorities, and such
determination shall be final and binding on all Participants and the Plan Agent.
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19. NOTICES
All communications with or notices to the Participants may be given by letter
addressed to the Participant at the Participant's last address of record with
the Company. The Participant agrees to give prompt written notice to the Company
of any change of address.
All communications with or notices required to be given to the Plan Agent should
be addressed to:
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
Additional Authorization Cards may be requested and inquiries made about the
Plan by writing to the mailing address shown above or by calling the Plan Agent
at (800) 278-4353.
In the event of any change in or substitution of the Plan Agent, a notice of the
new Plan Agent's address and telephone number shall be sent to all Participants
and this Section 19 shall be amended accordingly.
20. DUTIES AND RESPONSIBILITIES
Neither the Company, the Plan Agent nor its nominees shall have any
responsibility beyond the exercise of ordinary care for any action taken or
omitted pursuant to the Plan, nor shall they have any duties, responsibilities
or liabilities except such as are expressly set forth herein. Neither the
Company nor the Plan Agent shall be liable for any act done in good faith, or
for any good faith omission to act, including, without limitation, any claims of
liability (i) arising out of failure to terminate a Participant's account upon
such Participant's death prior to receipt of notice in writing of his or her
death, (ii) with respect to the prices at which shares of Common Stock are
purchased, (iii) with respect to the time when shares of Common Stock are
purchased or sold for a Participant's account, or any inability o purchase or
sell Common Stock, for any reason, and (iv) for any fluctuation in the market
value after the purchase or sale of Common Stock.
21. GOVERNING LAW
The Plan is governed by the laws of the State of Texas.
22. NO TERMINATION BY OPERATION OF LAW
The delivery by a Participant of a signed Authorization Card to the Plan Agent
shall constitute an irrevocable appointment of the Plan Agent as such
Participant's agent, which appointment can be terminated by terminating such
Participant's account in the manner provided in Section 14. The authority
conferred by the Authorization Card shall not be terminated by operation of law,
whether by the death or incapacity of the Participant, the termination of any
trust, the dissolution of any corporation or the occurrence of any other event.
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23. GENDER AND NUMBER
Except when otherwise indicated by the context, the masculine gender shall also
include the feminine gender, and the definition of any term herein in the
singular shall also include the plural.
24. EFFECTIVE DATE
The foregoing Plan was adopted by the Company's Board of Directors on January
28, 2000 and is effective as of March 31, 2000.
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