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EXHIBIT 10.2
WGNB CORP
INCENTIVE STOCK OPTION PLAN
1. Purpose. The purpose of the WGNB CORP Incentive Stock Option
Plan (the "Plan") is to advance the interests of WGNB CORP (the "Company") by
encouraging and enabling present and future key employees of the Company and any
parent or subsidiary to acquire a financial interest in the Company through
incentive stock options under the Plan. The Company believes that the Plan will
also aid the Company and any parent or subsidiary in attracting and retaining
outstanding key employees and in stimulating the efforts of such employees to
work for the success of the Company.
2. Administration.
(a) General. The Plan shall be administered, construed and
interpreted by the Executive Compensation and Management Succession
Committee (the "Committee") of the Board of Directors of the Company,
or if no such committee is established, then by the Board of Directors.
In the event that there is not a Committee established at any time
during the term of any option granted hereunder, references herein to
the committee shall be interpreted to be references to the Board of
Directors.
(b) Grant of Options. The Committee shall from time to time
recommend the persons who shall participate in the Plan and the extent
of their participation. The Committee also shall recommend the price to
be paid for shares upon the exercise of options granted under the Plan,
the period within which each option may be exercised, and the terms and
conditions of each individual Stock Option Agreement by and between the
Company and the holder of the option. The terms and conditions of each
individual Stock Option Agreement shall be consistent with the
provisions of the Plan, but the Committee may provide for such
additional terms and conditions, not in conflict with the provisions of
the Plan, as it deems advisable. All such recommendations by the
Committee shall be final upon approval of the Board of Directors.
(c) Interpretation of Plan. In interpreting the Plan, the
Committee and Board of Directors shall be governed by the principles
and requirements of sections 421, and 422 and related sections of the
Internal Revenue Code of 1986, as amended ("the Code"), and the
Treasury Regulations applicable to incentive stock options and
incentive stock option plans. Where applicable, unless otherwise
defined, a parent corporation is any corporation in an unbroken chain
of corporations ending with the Company if, at the time the option is
granted, each of the corporations other than the Company owns stock
possessing fifty percent (50%) or more of the total combined voting
power of all
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classes of stock in one of the other corporations in the chain. A
subsidiary corporation is any corporation in an unbroken chain of
corporations beginning with the company if, at the time the option is
granted, each of the corporations, other than the last corporation in
the unbroken chain, owns stock possessing fifty percent (50%) or more
of the total combined voting power of all classes of stock in one of
the other corporations in the chain. Such definitions of parent and
subsidiary shall be consistent with the definition of such terms as set
forth in Code section 424. All other terms used herein shall have and
shall be interpreted as having the meanings set forth in the applicable
provisions of the Code. The interpretation and construction by the
Committee of any provision of or term used in the Plan or any option
granted under the Plan and any determination pursuant to any provision
of the Plan or any such option shall be final and conclusive, unless
otherwise determined by the Board of Directors. No member of the
Committee or Board of Directors shall be liable for any action or
determination made in good faith, and members of the Committee and
Board of Directors shall be entitled to indemnification and
reimbursement from time to time for expenses incurred in defense of
such good faith action or determination.
3. Eligibility. Options under the Plan may be granted to key
senior officers, key officers and other key employees of the Company or of one
or more of any future parents or subsidiaries of the Company who, in the opinion
of the Committee, are contributing significantly to the effective management and
supervision of the business of the Company or its parents or subsidiaries.
Options may be granted under the Plan only to persons who are employed by the
Company or one of its parents or subsidiaries at the time of the grant. The fact
that an employee is a member of the Board of Directors of the Company shall not
make him ineligible for an option grant unless his vote is required to secure a
majority vote in favor of the grant of his option. For purposes of the Plan, a
person to whom an option is granted under the Plan shall be referred to as a
"Grantee".
4. Shares Subject to Plan. The shares subject to the Plan shall
be authorized but unissued or treasury shares of the Company's Two and 50/100
Dollars ($2.50) par value common stock (the "Common Stock"). Subject to
readjustment in accordance with the provisions of paragraph 6 of the Plan, the
maximum number of shares of Common Stock for which options may be granted under
the Plan shall be equal to five percent (5%) of the outstanding Common Stock as
of the date of approval by the shareholders, or 40,000 shares of Common Stock,
and the adoption of the Plan by the Board of Directors of the Company shall
constitute a reservation of such shares of Common Stock for issuance only upon
the exercise of options granted under the Plan. In the event that any
outstanding option granted under the Plan for any reason expires or is
terminated prior to the end of the period during which options may be granted
under the Plan, the shares of Common Stock allocable to the unexercised portion
of such option may again be subject in whole or in part to any option granted
under the Plan.
5. Terms and Conditions of Options. Options granted pursuant to
the Plan shall be evidenced by agreements (the "Stock Option Agreements") in
such form as the Committee and Board of Directors shall, consistent with the
provisions of Code sections 421 and 422 and related sections of the Code and
applicable Treasury Regulations, approve from time to time. Such Stock Option
Agreements and the options evidenced thereby shall comply with and be subject to
the following terms and conditions:
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(a) Number of Shares. Each Stock Option Agreement shall state
the total number of shares of Common Stock to which it pertains.
(b) Amount Limitation. A key employee may not be granted
incentive stock options which are exercisable for the first time in any
one calendar year under the Plan and any other incentive stock option
plan of the Company or any parent or subsidiary corporation of the
Company, for the purchase of Common Stock with an aggregate fair market
value of more than One Hundred Thousand Dollars ($100,000) (valued as
of the date of grant of the option).
(c) Option Price. The option price for each option granted
under the Plan shall be the amount determined by the Board of
Directors, upon the recommendation of the Committee, but, subject to
the provisions of paragraph 5(j) of the Plan, shall not be less than
one hundred percent (100%) of the fair market value of the shares of
Common Stock subject to the option on the date of grant of the option.
The date on which the Board of Directors approves the granting of an
option shall be considered the date on which such option is granted.
For purposes of the Plan, the "fair market value" of the shares of
Common Stock shall be the mean between the high "bid" and the low
"asked" prices of the Common Stock in the over-the-counter market on
the day on which such value is to be determined or, if no shares were
traded on such day, on the next preceding day on which shares were
traded, as reported. If the Common Stock is not regularly traded in the
over-the-counter market but is registered on a national securities
exchange, the "fair market value" of the shares of Common Stock shall
mean the closing price of the Common Stock on such national securities
exchange on the day on which such value is to be determined or, if no
shares were traded on such day, on the next preceding day on which
shares were traded, as reported by National Quotation Bureau,
Incorporated or other national quotation service. If the Common Stock
is not regularly traded in the over-the-counter market or registered in
a national securities exchange the Committee shall determine the fair
market value of the common stock in good faith in accordance with Code
section 422 (c) (1) and accompanying Treasury Regulations.
(d) Medium and Time of Payment. The option price shall be
payable upon the exercise of an option in cash or by check or, if
provided in the Stock Option Agreement, in shares of Common Stock owned
by the Grantee. In the event that all or part of the option price is
paid in shares of Common-Stock, the value of such shares shall be equal
to the fair market value of such shares on the date of exercise of the
option (determined as provided in paragraph 5(c) of the Plan), and the
Grantee shall deliver to the Company a certificate or certificates
representing such shares duly endorsed to the Company or accompanied by
a duly-executed separate instrument of transfer satisfactory to the
Committee.
(e) Term and Exercise. Except as set forth in paragraph 5(j)
of the Plan each option granted under the Plan shall be exercisable by
the Grantee only during a term fixed by the Board of Directors upon
recommendation of the Committee ending not later than ten (10) years
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after the date of grant of the option. The Board of Directors upon
recommendation of the Committee shall determine whether the option
shall be exercisable in full at any time during the term or in
cumulative or non-cumulative installments during the term.
(f) Method of Exercise. All options granted under the Plan
shall be exercised by written notice directed to the officer of the
Company indicated in the Stock Option Agreement at the Company's
principal place of business. Such written notice shall specify the form
of payment made by the Grantee or his successor as provided by
paragraph 5(d) of the Plan and shall be accompanied by payment in full
of the option price for the shares for which such option is being
exercised. The Company shall make delivery of certificates representing
the shares for which an option has been exercised within a reasonable
period of time; provided, however, that if any law, regulation or
agreement requires the Company to take any action with respect to the
shares for which an option has been exercised before the issuance
thereof, then the date of delivery of such shares shall be extended for
the period necessary to take such action.
(g) Effect of Termination of Employment or Death.
(A) Termination of Employment.Except as otherwise
provided in this subparagraph (A) or in subparagraph (B) below
upon termination of the employment of any Grantee with the
Company or any parent or subsidiary corporation of the Company
for any reason, all options held by the Grantee under the Plan
shall immediately terminate. Whether military, government or
other service or other leave of absence shall constitute a
termination of employment shall be determined in each case by
the Committee in its discretion, and any determination by the
Committee shall be final and conclusive. The Board of
Directors upon recommendation of the Committee at its election
may provide in any Stock Option Agreement that the Grantee may
exercise an option at any time within three (3) months after
the termination of employment of the Grantee with the Company
or any parent or subsidiary corporation then employing the
Grantee (or within one (1) year after the termination of such
employment if such employment is terminated due to the
Grantee's permanent disability). In no event, however, will
the option be exercisable after the expiration of the term of
the option. In addition, exercise of the option following
termination of the Grantee's employment shall be subject to
the following terms and conditions: (i) with respect to any
and all installments of the option that had not become
exercisable at the time of termination of employment, the
period of extension shall not, unless otherwise provided in
the Stock option Agreement, operate to permit such installment
to become exercisable within such period; and (ii) with
respect to any installment of the option that had become
exercisable at the time of termination of employment, the
period of extension shall not operate to permit the exercise
of such installment after the expiration of the period within
which such installment may be exercised. For purposes of this
subparagraph (A), if any corporation ceases to be a parent or
subsidiary of the
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Company, the employment of any Grantee employed by such
corporation shall be deemed to have terminated unless such
Grantee becomes an employee of the company or another parent
or subsidiary of the Company simultaneously with or prior to
the time such corporation ceases to be a parent or subsidiary
of the Company. For purposes of the Plan, "permanent
disability" shall mean a permanent disability as defined in
Code section 22(e)(3).
(B) Death. In granting any option under the Plan, the
Board of Directors and Committee may provide in the Stock
Option Agreement representing such option that in the event of
the death of a grantee at a time when an option is exercisable
by the Grantee, the Grantee's personal representatives, heirs
or legatees (the "Grantee's Successors") may exercise all or
any portion of such option held by the Grantee on the date of
his death upon proof satisfactory to the Company of their
authority. The Grantee's Successors must exercise any such
option within twelve (12) months after the date of the
Grantee's death and in any event prior to the date of
expiration of the option. Such exercise otherwise shall be
subject to the terms and conditions of the Plan; provided,
however, that with respect to any installment of the option
that had not become exercisable on the date of the Grantee's
death, the period of extension shall not, unless otherwise
provided in the Option Agreement, operate to permit such
installment to become exercisable within such period.
(h) Nonassignability of Option Rights. No option shall be
assignable or transferable by the Grantee except by will or by the laws
of descent and distribution. During the lifetime of the Grantee, the
option shall be exercisable only by the Grantee.
(i) Rights as Stockholder. Neither the Grantee nor the
Grantee's Successors shall have rights as a stockholder of the Company
with respect to shares of Common Stock covered by the Grantee's option
until the Grantee or the Grantee's Successors become the holder of
record of such shares. Except as specified in paragraph 6 of the Plan,
no adjustment will be made for dividends or other rights for which the
record date is prior to the date on which shares are issued upon
exercise of an option.
(j) No Options in Certain Cases. Except as set forth in
paragraph 5 (j) of the Plan, no options shall be granted except within
a period of ten (10) years after the effective date of the Plan. In no
event shall an option be granted to any person who, at the time such
option is granted, owns (as defined in Code section 422 (b)(6)) stock
possessing more than ten percent (10%) of the total combined voting
power or value of all classes of stock of the Company or of any parent
or subsidiary corporation of the Company unless (i) the option price
under such option is not less than one hundred and ten percent (110%)
of the fair market value of the shares of Common Stock subject to such
option on the date of grant of such option (determined as provided in
paragraph 5(c) of the Plan) and (ii) the terms of the Stock Option
Agreement shall make such option expire on the date that is the fifth
(5th) anniversary after the date on which the option is granted.
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(k) Miscellaneous Provisions. The Stock option Agreements
authorized under the Plan may contain such other provisions, not
inconsistent with the Plan or the applicable provisions of the Code as
the Committee shall deem advisable.
6. Adjustments.
(a) Recapitalization. In the event that, after the effective
date of the Plan, the outstanding shares of Common Stock are increased
or decreased or changed into or exchanged for a different number or
kind of shares or other securities of the Company by reason of a
recapitalization, reclassification, stock split-up, combination of
shares, or dividend payable in stock, appropriate adjustments shall be
made by the Committee in the number and kind of shares or other
securities for which options may be granted under the Plan. In
addition, the Committee upon the occurrence of such an event shall make
appropriate adjustments in the number and kind of shares or other
securities as to which outstanding options, or portions thereof then
unexercised, shall be exercisable, so that each Grantee's proportionate
interest shall be maintained as before the occurrence of such event.
Such adjustment in outstanding options shall be made without change in
the total price applicable to the unexercised portion of each option
and with a corresponding adjustment in the option price per share. Any
fractional shares resulting from any of the foregoing adjustments under
this subparagraph (a) shall be disregarded and eliminated. Each such
adjustment under this subparagraph (a) shall be made in such a manner
that such adjustment will not constitute a "modification" as defined in
Code section 424. All adjustments made by the Committee (unless
otherwise determined by the Board of Directors) under this subparagraph
(a) shall be final and conclusive.
(b) Reorganizations; Liquidation. If the Company shall be a
party to any reorganization involving a merger, consolidation or
acquisition of the stock or the assets of the Company, the Committee,
in its discretion, may:
(A) Declare that all options granted under the Plan
shall become exercisable immediately notwithstanding the provisions
of the respective Stock Option Agreements regarding exercisability
and that all options shall terminate thirty (30) days after the
Committee gives written notice to all Grantees of their immediate
right to exercise all options then outstanding and of the
Committee's decision to terminate all options not exercised within
such thirty-day period; or
(B) Notify all Grantees that all options granted under
the Plan shall apply with appropriate adjustments as determined by
the Committee to the securities of the resulting corporation to
which holders of the number of shares of Common Stock subject to
such options would have been entitled.
The adoption of a plan of dissolution or liquidation by the Board of
Directors and the stockholders of the Company shall cause every
option outstanding under the Plan to terminate to the extent not
exercised prior to the adoption of the plan of
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dissolution or liquidation by the stockholders; provided, however,
that the Committee, in its discretion, may declare that all options
granted under the Plan shall become exercisable immediately
notwithstanding the provisions of the respective Stock Option
Agreements regarding exercisability; and provided further that in
the event of the adoption of a plan of dissolution or liquidation in
connection with a reorganization as described in the first sentence
of this subparagraph (b), outstanding options shall be governed by
and be subject to the provisions of such sentence.
(c) Rights or Warrants. If any rights or warrants to subscribe
for additional shares are given pro rata to holders of outstanding
shares of the Common Stock, each Grantee under the Plan shall be
entitled to the same rights or warrants on the same basis as holders of
the outstanding shares with respect to such portion of the Grantee's
option that may be exercised on or prior to the date of the expiration
of such rights or warrants.
7. Effective Date and Termination of Plan.
(a) Effective Date. The effective date of the Plan shall be
January 11, 1994, the date of its adoption by the Board of Directors of
the Company, provided that the stockholders of the Company (acting at a
duly called meeting of the stockholders) shall approve the Plan before
January 10, 1995.
(b) Termination. The Plan shall terminate ten (10) years after
its effective date, but the Board of Directors may terminate the Plan
at any time prior to such date. Termination of the Plan shall not alter
or impair any of the rights or obligations under any option theretofore
granted under the Plan unless the Grantee shall so consent.
8. Application of Funds. The proceeds received by the Company
from the sale of shares of Common Stock pursuant to options granted under the
Plan will be used for general corporate purposes.
9. No Obligation to Exercise Option. The granting of an option
shall impose no obligation upon the Grantee to exercise such option.
10. Amendment. The Board of Directors of the Company by majority
vote may at any time and from time to time amend the Plan in such respects as it
shall deem advisable in order that options granted under the Plan shall be
"incentive stock options" as defined in Code section 422, or to conform to any
change in the law, or for any other purpose; provided, however, that without the
approval of the stockholders of the Company, no such amendment shall change:
(a) The maximum number of shares of Common Stock as to which
options may be granted under the Plan (except by operation of the
adjustment provisions of the Plan); or
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(b) The date on which the Plan will terminate as provided by
paragraph 7 (b) of the Plan; or
(c) The minimum option price as provided under paragraph 5(c)
of the Plan, other than to change the manner of determining the fair
market value of the Common Stock to conform with any provisions of the
Code or Treasury Regulations thereunder applicable to incentive stock
options or if such change is necessitated by a change in the manner in
which Common Stock is traded; or
(d) The period during which options may be granted as provided
in paragraph 5(j) of the Plan (provided, however, that the Board of
Directors of the Company shall have the power set forth in paragraph
7(b) to terminate the Plan); or
(e) The provisions of paragraph 3 of the Plan relating to the
determination of employees to whom options may be granted.
Any amendment to the Plan shall not, without the written consent of the
Grantee, affect such Grantee's rights under any option theretofore granted to
such Grantee.
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