Registration No. 33-__________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
__________
CT COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
NORTH CAROLINA 56-1837282
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
68 CABARRUS AVENUE, EAST
POST OFFICE BOX 227
CONCORD, NORTH CAROLINA 28025
(Address of Principal Executive Offices)
__________
CT COMMUNICATIONS, INC. RESTRICTED STOCK AWARD PROGRAM
(Full title of the Plan)
__________
MICHAEL R. COLTRANE
PRESIDENT AND CEO
CT COMMUNICATIONS, INC,
68 CABARRUS AVENUE,EAST
POST OFFICE BOX 227
CONCORD, NORTH CAROLINA 28025
(Name and address of agent for service)
(704) 788-0214
(Telephone number, including area code, of agent for service)
__________
COPY TO:
R. DOUGLAS HARMON
SMITH HELMS MULLISS & MOORE, L.L.P.
POST OFFICE BOX 31247
CHARLOTTE, NORTH CAROLINA 28231
__________
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of
this Registration Statement.
__________
CALCULATION OF REGISTRATION FEE
Proposed Maximum
Title of each Class of Amount to be Offering
Securities to be Registered Registered Price Per Share (1)
- --------------------------- ------------ -------------------
Class B Nonvoting 5,000 $251
Common Stock shares
$50.00 par value
Proposed Maximum Amount of
Title of each Class of Aggregate Registration
Securities to be Registered Offering Price (1) Fee
- --------------------------- ------------------ ------------
Class B Nonvoting $1,255,000 $432.72
Common Stock
$50.00 par value
(1) Estimated solely for the purpose of calculating the
registration fee and computed according to Rule 457(h) under the
Securities Act of 1933, as amended, based on the price of the
Common Stock of which options granted pursuant to the Plan may be
exercised.
<PAGE>
PART I. INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents constituting the Prospectus of CT
Communications, Inc. (the "Registrant") with respect to this
Registration Statement in accordance with Rule 428 promulgated
pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), are kept on file at the offices of the
Registrant. The Registrant will provide without charge to
employees, on the written or oral request of any such person, a
copy of any or all of the documents constituting the Prospectus.
Written requests for such copies should be directed to the
Treasurer, CT Communications, Inc., 68 Cabarrus Avenue, East,
Post Office Box 227, Concord, North Carolina 28025. Telephone
requests may be directed to (704) 788-0244.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with the
Securities and Exchange Commission (the "Commission") are
incorporated by reference herein and in the Prospectus
constituting a part of this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for
the year ended December 31, 1994, filed pursuant to Section 13 of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act");
(b) The Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1995, filed pursuant to Section 13 of
the Exchange Act; and
(c) The description of the Registrant's Common Stock,
$50 par value, contained in its Registration Statement filed
under the Exchange Act and all amendments and reports filed for
the purpose of updating such description, including the
Registrant's Definitive Proxy Statement filed with the Commission
on September 21, 1993.
All documents filed by the Registrant with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), subsequent
to the effectiveness of this Registration Statement and prior to
the filing of a post-effective amendment hereto, which either
indicates that all securities offered hereto have been sold or
deregisters all securities then remaining unsold shall be deemed
to be incorporated by reference in this Registration Statement
and the Prospectus and to be a part hereof and thereof from the
date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference
herein or therein shall be deemed to be modified or superseded
for purposes of this Registration Statement and the Prospectus to
the extent that a statement contained herein or therein or in any
other subsequently filed document which also is or is deemed to
be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
a part of this Registration Statement or the Prospectus.
The Registrant will provide without charge to each person to
whom the Prospectus constituting a part of this Registration
Statement is delivered, on the written or oral request of any
such person, a copy of any or all of the documents incorporated
herein and in the Prospectus by reference (other than exhibits to
such documents which are not specifically incorporated by
reference in such documents). Written requests for such copies
should be directed to the Treasurer, CT Communications, Inc. 68
Cabarrus Avenue, East, Post Office 227, Concord, North Carolina
28025. Telephone requests may be directed to (704) 788-0244.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
There are no provisions in the Registrant's Articles of
Incorporation, and no contracts between the Registrant and its
directors and officers nor resolutions adopted by the Registrant,
relating to indemnification. The Registrant's Articles of
Incorporation prevent the recovery by the Registrant of monetary
damages against its directors. However, in accordance with the
provisions of the North Carolina Business Corporation Act (the
"Act"), the Registrant's Bylaws provide that, in addition to the
indemnification of directors and officers otherwise provided by
the Act, the Registrant shall, under certain circumstances,
indemnify its directors, executive officers and certain other
designated officers against any and all liability and litigation
expense, including reasonable attorneys' fees, arising out of
their status or activities as directors and officers, except for
liability or litigation expense incurred on account of activities
that were at the time known or reasonably should have been known
by such director or officer to be clearly in conflict with the
best interests of the Registrant. Pursuant to such bylaw and as
authorized by statute, the Registrant maintains insurance on
behalf of its directors and officers against liability asserted
against such persons in such capacity whether or not such
director or officers have the right to indemnification pursuant
to the bylaw or otherwise.
In addition to the above-described provisions, Sections
55-8-50 through 55-8-58 of the Act contain provisions prescribing
the extent to which directors and officers shall or may be
indemnified. Section 55-8-51 of the Act permits a corporation,
with certain exceptions, to indemnify a present or former
director against liability if (i) he conducted himself in good
faith, (ii) he reasonably believed (x) that his conduct in his
official capacity with the corporation was in its best interests
and (y) in all other cases his conduct was at least not opposed
to the corporation's best interest and (iii) in the case of any
criminal proceeding, he had no reasonable cause to believe his
conduct was unlawful. A corporation may not indemnify a director
in connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation or in connection with a proceeding charging improper
personal benefit to him in which he was adjudged liable on such
basis. The above standard of conduct is determined by the Board
of Directors, or a committee or special legal counsel or the
shareholders as prescribed in Section 55-8-55.
Sections 55-8-52 and 55-8-56 of the Act require a
corporation to indemnify a director or officer in the defense of
any proceeding to which he was a party because of his capacity as
a director or officer against reasonable expenses when he is
wholly successful in his defense, unless the articles of
incorporation provide otherwise. Upon application, the court may
order indemnification of the director or officer if he is
adjudged fairly and reasonably so entitled under Section 55-8-54.
Section 55-8-56 allows a corporation to indemnify and advance
expenses to an officer, employee or agent who is not a director
to the same extent as a director or as otherwise set forth in the
corporation's articles of incorporation or bylaws or by
resolution of the Board of Directors.
The foregoing is only a general summary of certain aspects
of North Carolina law dealing with indemnification of directors
and officers and does not purport to be complete. It is
qualified in its entirety by reference to the relevant statutes
which contain detailed specific provisions regarding the
circumstances under which and the person for whose benefit
indemnification shall or may be made and accordingly are set
forth in Exhibit 99.2 hereto and incorporated herein by
reference.
ITEM 8. EXHIBITS.
The following exhibits are filed with or incorporated by
reference in this Registration Statement.
EXHIBIT NO.
(PER EXHIBIT
TABLES IN
ITEM 601 OF
REGULATION S-K) DESCRIPTION OF EXHIBIT
- --------------- ----------------------
4.1 Articles of Incorporation of the Registrant,
incorporated by reference to Registrant's
Annual Report on Form 10-K for the fiscal
year ended December 31, 1993, dated March 29,
1994.
4.2 Bylaws of the Registrant, incorporated by
reference to Registrant's Annual Report on
10-K for the fiscal year ended December 31,
1993, dated March 29, 1994.
5.1 Opinion of Smith Helms Mulliss & Moore,
L.L.P., as to legality of securities to be
registered.
23.1 Consent of Smith Helms Mulliss & Moore,
L.L.P. (included in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP, independent
certified public accountants.
24.1 Power of Attorney (included in signature
page).
99.1 Restricted Stock Award Program.
99.2 Provisions of North Carolina law relating to
indemnification.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) 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;
(iii) 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) do
not apply if the Registration Statement is on Form S-3 or Form
S-8, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13
or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, 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.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) 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.
(c) Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of
the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the
Securities Act of 1933, the Registrant certifies that it has
reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Concord,
North Carolina, on May 18, 1995.
CT COMMUNICATIONS, INC.
By:/S/ MICHAEL R. COLTRANE
Michael R. Coltrane
President and Chief Executive Officer
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each individual whose
signature appears below constitutes and appoints Michael R.
Coltrane and Roy W. Long, and each of them acting individually,
his true and lawful attorneys-in-fact and agents with full power
of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this
registration statement, and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the
Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them acting
individually, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, and each of them acting
individually, or his 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 and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/S/MICHAEL R. COLTRANE President, Chief Executive May 18, 1995
Michael R. Coltrane Officer and Director
(Principal Executive Officer)
\s\L.D. COLTRANE III Chairman of the Board May 18, 1995
L.D. Coltrane III and Director
/S/ROY W. LONG Vice President, Treasurer May 18, 1995
Roy W. Long and Chief Financial
Officer (Principal Financial
and Principal Accounting
Officer)
/S/JOHN R. BOGER, JR. Director May 18, 1995
John R. Boger, Jr.
\s\PHIL W. WIDENHOUSE Director May 18, 1995
Phil W. Widenhouse
/S/JERRY H. MCCLELLAN Executive Vice May 22, 1995
Jerry H. McClellan President, General
Plant Manager, Secretary
and Director
\s\BETTY GAY BIVENS Director May 19, 1995
Betty Gay Bivens
\s\BEN F. MYNATT Director May 19, 1995
Ben F. Mynatt
<PAGE>
EXHIBIT INDEX
EXHIBIT NO.
(PER EXHIBIT
TABLES IN
ITEM 601 OF SEQUENTIAL
REGULATION S-K) DESCRIPTION OF EXHIBIT PAGE NO.
- -------------- ---------------------- ----------
4.1 Articles of Incorporation of the
Registrant, incorporated by
reference to Registrant's Annual
Report on Form 10-K for the fiscal
year ended December 31, 1993, dated
March 29, 1994.
4.2 Bylaws of the Registrant, incorporated by
reference to Registrant's Annual Report
on 10-K for the fiscal year ended
December 31, 1993, dated March 29, 1994.
5.1 Opinion of Smith Helms Mulliss & Moore,
L.L.P., as to legality of securities to
be registered.
23.1 Consent of Smith Helms Mulliss & Moore,
L.L.P. (included in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP,
independent certified public accountants.
24.1 Power of Attorney (included in signature
page).
99.1 Restricted Stock Award Program.
99.2 Provisions of North Carolina law
relating to indemnification.
SMITH HELMS MULLISS & MOORE, L.L.P.
P. O. Box 31247
Charlotte, North Carolina 28231
(704) 343-2000
May 26, 1995
CT Communications, Inc.
68 Cabarrus Avenue, East
P. O. Box 227
Concord, North Carolina 28025
Re: Registration Statement on Form S-8 Filed May 26, 1995 -
5,000 Shares of Class B Nonvoting Common Stock to be Issued
Pursuant to Restricted Stock Award Program
Gentlemen:
In connection with the possible offering and sale from time
to time of all or a portion of 5,000 shares of the Class B
Nonvoting Common Stock, $50.00 par value per share, of CT
Communications, Inc. (the "Shares"), upon the terms and
conditions set forth in the Registration Statement on Form S-8
(the "Registration Statement") filed on May 26, 1995 by the
registrant with the Securities and Exchange Commission under the
Securities Act of 1933, we are of the opinion that when (a) the
Registration Statement shall become effective and (b) the Shares
have been sold upon the terms and conditions set forth in the
Registration Statement, the Shares will be validly authorized and
legally issued, fully paid and non-assessable.
We hereby consent to the filing of a copy of this opinion as
Exhibit 5.1 of the Registration Statement.
Very truly yours,
SMITH HELMS MULLISS & MOORE, L.L.P.
Independent Auditors' Consent
The Board of Directors
CT Communications, Inc.:
We consent to incorporation by reference in the registration
statement on Form S-8 pertaining to the CT Communications, Inc.
Restricted Stock Award Program of our report dated March 3,
1995, related to the consolidated balance sheets as of December
31, 1994 and 1993, and the related consolidated statements of
income, retained earnings, and cash flows for each of the years
in the three-year period ended December 31, 1994, and the
related financial statement schedules which report appears in
the December 31, 1994 annual report on Form 10-K of CT
Communications, Inc.
As discussed in Note 1 to the consolidated financial statements,
the Company changed its method of accounting for investments as
of Januay 1, 1994 to adopt the provisions of its Financial
Accounting Standards Board's Statement of Financial Accounting
Standards (SFAS) No. 115, "Accounting for Certain Investments in
Debt and Equity Securities." As discussed in Note 1, the Company
changed its method of accounting for income taxes on January 1,
1993 to adopt the provisions of the Financial Accounting
Standards Board's SFAS No. 109, "Accounting for Income Taxes."
KPMG PEAT MARWICK LLP
Charlotte, North Carolina
May 25, 1995
CT COMMUNICATIONS, INC.
RESTRICTED STOCK AWARD PROGRAM
THIS RESTRICTED STOCK AWARD PROGRAM (the "Program") is
adopted on the _____ day of _____________, 1995 by CT
Communications, Inc. (the "Corporation"), a corporation organized
and existing under the laws of the State of North Carolina and
having its principal place of business in Cabarrus County, North
Carolina, to provide an incentive to certain key employees of the
Corporation or a Subsidiary (as that term is defined in section
424(f) of the Internal Revenue Code of 1986, as now in force or
as hereafter amended (the "Code"), through the acquisition of an
equity interest in the Corporation. When selecting the employees
eligible to participate in this Program the Named Fiduciary (as
defined in Section 11(c)) will consider, among other criteria,
the position and responsibilities of the employee, the value of
the employee's services to the Corporation and other such factors
as the Named Fiduciary deems pertinent, and each employee
selected to participate in the Program (individually referred to
hereafter as a "Participant") will enter into a separate written
agreement between the Corporation and the Participant
(hereinafter referred to as an "Agreement").
W I T N E S S E T H:
WHEREAS, each Participant is currently, and will be at the
date of an award, employed by the Corporation or Subsidiary as an
executive, management or key employee and, as such, is considered
to be a member of a select group of management of the Corporation
or Subsidiary and/or a highly compensated employee; and
WHEREAS, the Corporation desires to provide deferred
compensation to the Participants, the amount of which is directly
related to the Corporation's continued financial success, in
order to provide an additional incentive to the Participants;
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and conditions as will be set forth in the
respective Agreements and hereinafter set forth, and other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Corporation hereby states:
1. PURPOSE. The purpose of the Program is to provide
deferred compensation and additional equity participation to each
Participant based upon the award of shares of the Corporation's
Class B common stock (the "Class B Stock"). The shares of Class
B Stock that may be granted to the Participants hereunder are
referred to collectively as the "Restricted Stock". The Program
is also intended to benefit the Corporation or Subsidiary by
creating an additional incentive for the Participants. The
awards of Restricted Stock granted hereunder are a matter of
separate inducement and are not made in lieu of any salary or
other compensation for the services of any key employees.
2. SHARES. The aggregate amount of Class B Stock that may
be awarded to Participants under the Program is 5000 shares. Any
grant of shares of Restricted Stock may be made from authorized
but unissued shares of Class B Stock or issued shares of Class B
Stock obtained on the open market.
3. EFFECTIVE DATE. The Effective Date for this Program is
___________ ____, 1995. The Effective Date for each grant to an
individual Participant is the Participant's Effective Date as
indicated in the Agreement signed by each Participant for each
grant hereunder, which is incorporated herein and made an
integral part of this Program.
4. GRANT AND VESTING OF RESTRICTED STOCK.
4.1 GRANT. The Named Fiduciary may from time to time
grant to Participant shares of Restricted Stock, with the number
of any such shares so granted and the terms and conditions of
such grant being indicated in such Participant's Agreement. The
Restricted Stock will be granted based upon and at all times
subject to the provisions, conditions and restrictions in such
Participant's Agreement and shall entitle the Participant to the
rights set forth in this Program.
4.2 RESTRICTED PERIOD. Subject at all times to the
provisions of Section 4.3, the Restricted Stock will remain
subject to the restrictions described in Sections 5 and 6 hereof
until the end of the Restricted Period as specified in a
Participant's Agreement or until the lapse of any other
restriction specified in such Participant's Agreement.
4.3 RESTRICTED PERIOD ACCELERATED. In the event that
a Participant's employment with the Corporation ends due to the
Participant's death, disability (as defined in the CT
Communications, Inc. 1995 Comprehensive Stock Option Plan),
retirement with the consent of the Corporation, or because the
Corporation undergoes a "Change of Control" (as hereinafter
defined), then the Restricted Period shall end and all
restrictions on the Class B Stock granted hereunder other than
those contained in Section 6(a) hereunder shall lapse. A "Change
of Control" shall be deemed to have occurred on (i) the effective
date of a plan of merger of consolidation of the Corporation with
any other corporation as a result of which the holders of the
voting capital stock of the Corporation as a group would receive
less than 50% of the voting capital stock of the surviving or
resulting corporation, (ii) the effective date of an agreement
providing for the sale or transfer (other than as security for
obligations of the Corporation) of all or substantially all the
assets of the Corporation, or (iii) in the absence of a prior
expression of approval by the Board of Directors of the
Corporation, the acquisition except by inheritance or devise of
more than 20% of the Corporation's voting capital stock by any
person within the meaning of Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended, other than a person, or group
including a person, who beneficially owned, as of the effective
date of the Plan, more than five percent of the Corporation's
voting stock or equity.
5. RIGHTS IN SHARES OF RESTRICTED STOCK DURING THE
RESTRICTED PERIOD. Prior to the end of the Restricted Period, a
Participant may not sell, transfer, assign, pledge, hypothecate
or otherwise dispose of, grant a security interest in or encumber
any of such shares of Restricted Stock except as provided in
Section 6. A Participant shall, however, be entitled to any
voting rights with respect to such shares of Restricted Stock and
shall be entitled to receive any cash dividends made with respect
to such shares of Restricted Stock. Any shares issued by the
Corporation pursuant to a stock dividend or stock split in
respect of shares of Restricted Stock prior to the end of the
Restricted Period as described in Sections 4.2 and 4.3 shall be
subject to the restrictions, terms and conditions under the
Program and the Participant's Agreement as the shares of
Restricted Stock in respect of which the shares are issued.
6. RESTRICTIONS ON SHARES DURING THE RESTRICTED PERIOD.
(a) OPTION TO REPURCHASE UPON DEATH OR DISABILITY OF A
PARTICIPANT: Upon the death or disability (as defined in Section
4.3) of a Participant during the Restricted Period, the
Corporation shall have the option, but not the obligation, to
purchase any part or all of any shares of the Class B Stock which
remains restricted hereunder and was acquired by the Participant
pursuant to the Plan and owned at the date of his death.
The option to purchase hereunder may be exercised by
the Corporation's giving written notice to the personal
representative of the Participant's estate within one hundred and
fifty (150) days after the qualification of such personal rep-
resentative.
The purchase price of any share purchased by the
Corporation pursuant to the purchase option under this Section
6(a) will be equal to the fair market value for a share of Class
B Stock in the most recent quarterly appraisal provided by the
Corporation's appraisers. The closing shall occur as set forth
in Section 6 (d) hereof.
(b) OPTION TO REPURCHASE UPON TERMINATION OF
EMPLOYMENT OTHER THAN FOR RETIREMENT: Upon the termination of
the Participant's employment with the Corporation or Subsidiary
during the Restricted Period for any reason other than retirement
with the consent of the Corporation or Subsidiary or as provided
in Section 6(a) hereof, the Corporation shall have the option,
but not the obligation, to purchase any part or all of any shares
of the Class B Stock which remains restricted hereunder and was
acquired by the Participant pursuant to this Plan and owned by
Participant at the date of the termination of his employment with
the Corporation or Subsidiary.
The option to purchase hereunder may be exercised by
the Corporation's giving written notice to Participant within
ninety (90) days after the date of such termination.
The purchase price of any share purchased by the
Corporation pursuant to the purchase option under this Section
6(b) will be the fair market value of a share of Class B Stock as
of the quarterly appraisal provided by the Corporation's
appraisers immediately prior to the Participant's Effective Date
for each grant as described in Section 3 hereof and as indicated
in the individual Participant's Agreements(s) entered into by the
Corporation and a Participant. The closing shall occur as set in
Section 6 (d) hereof.
(c) PARTICIPANT'S RIGHTS UPON RETIREMENT: Upon the
Participant's retirement with the consent of the Corporation or
Subsidiary during the Restricted Period, all restrictions on the
Class B Stock granted hereunder shall lapse and the Participant
will own the Class B Stock without restrictions under this
Program. The Corporation will have no right, option or
obligation to repurchase the Class B Stock granted hereunder but
may do so if the Participant and Corporation so agree.
(d) CLOSING: The closing shall occur at the principal
office of the Corporation in Concord, North Carolina at a time
and date set by the Corporation. At the closing, the Participant
(or his personal representative) shall deliver to the Corporation
the Certificate(s) evidencing the shares being purchased duly
endorsed and the Corporation shall deliver to the Participant (or
his personal representative) the consideration for such shares in
cash or check.
(e) MISCELLANEOUS PROVISIONS: As used herein, the
term "transfer" or "encumber" shall include a transfer or encum-
brance by any means whatsoever including by way of illustration
and not of limitation, by gift, sale, assignment, hypothecation,
pledge, security interest or lien. The Corporation shall have
the right to assign any part or all of its options to purchase
pursuant to Section 6 (a) or (b) hereof to any individual(s) or
entity(s) as it may select. The shares owned by a Participant
(or his estate) shall not be entitled to vote on any matters
relating to the options granted to the Corporation pursuant to
this Section, including, but not limited to, the exercise or
assignment thereof.
The provisions of this Section 6 shall not be
applicable to a transfer by a Participant which is incident to a
transfer by the shareholders of the Corporation resulting in the
transfer of substantially all of the issued and outstanding
shares of the Corporation nor shall it be applicable to the
redemption of a Participant's shares pursuant to a complete
liquidation and dissolution of the Corporation.
7. CERTIFICATES AND LEGEND. The Corporation shall issue a
certificate to a Participant for the Participant's shares of
Restricted Stock as soon as practicable following execution of
the Participant's Agreement. The certificates representing the
shares of Restricted Stock issued to a Participant shall have
endorsed across the face or back thereof the following legend:
"The shares of stock represented by this certificate are subject
to the terms and conditions of the CT Communications, Inc.
Restricted Stock Award Program dated __________, and a Restricted
Stock Award Agreement entered into between the Corporation and
the holder of this certificate, which Program and Agreement are
on file with the Secretary of the Corporation. The shares of
stock represented by this certificate may not be sold,
transferred, assigned, pledged, hypothecated or otherwise
disposed of or encumbered except in accordance with the
provisions of such program and agreement."
8. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. The total
number of shares of Restricted Stock granted, or which may be
granted, under the Program shall be appropriately adjusted for
any increase or decrease in the number of outstanding shares of
Class B Stock resulting from payment of a stock dividend on the
Class B Stock, a subdivision or combination of shares of the
Class B Stock or from a reclassification of the Class B Stock.
Such adjustments shall be determined by the Board of Directors of
the Corporation in its sole discretion. Any such adjustment may
provide for the elimination of any fractional share which might
otherwise result. The grant or award of shares of Restricted
Stock under the Program shall not affect in any way the right or
power of the Corporation or Subsidiary to make adjustments,
reclassifications, reorganizations or changes of its capital or
business structure or to merge or consolidate, or to dissolve,
liquidate or sell, or transfer all or part of its business or
assets.
9. INDEMNIFICATION AND EXPENSES. All expenses and costs
in connection with the administration of the Plan shall be borne
by the Corporation. In addition to and consistent with such
other rights of indemnification as they may have, any individual
or group of individuals appointed by the Corporation to
administer the Program, including but not limited to the Named
Fiduciary as described in Section 11(c), shall be indemnified by
the Corporation, individually and jointly, against all costs and
expenses reasonably incurred by them or any of them in connection
with any action, suit or proceeding to which they or any of them
may be a party by reason of any action taken or failure to act
under or in connection with the Program or any award of
Restricted Stock granted pursuant thereto and against all amounts
paid by them in settlement thereof (provided such settlement is
approved by legal counsel selected by the Corporation) or paid by
them in satisfaction of the judgment in any action, suit or
proceeding; provided, that upon institution of any such action,
suit or proceeding, the person desiring indemnification shall
give the Corporation an opportunity, at the expense of the
Corporation to handle and defend the same.
10. COMPLIANCE WITH LAWS AND REGULATIONS. The shares of
Restricted Stock that may be granted hereunder and the obligation
of the Corporation to deliver such shares is subject to all
applicable federal and state laws, rules and regulations, and to
such approvals by any governmental or regulatory agencies as may
be required. With respect to persons subject to Section 16 of
the Securities Exchange Act of 1934 (the "Exchange Act"),
transactions under this Program are intended to comply with all
applicable conditions of Rule 16b-3 or any successor provision
under the Exchange Act. To the extent that any provision of the
Program or any Participant's Agreement or action by the Named
Fiduciary fails to so comply, it shall be deemed null and void,
to the extent permitted by law and deemed advisable by the Named
Fiduciary.
11. MISCELLANEOUS PROVISIONS.
(a) Nothing contained in this Program or in a
Participant's Agreement, and no action taken pursuant to the
provisions hereof or thereof by any party hereto or thereto,
shall create, or be construed to create, a trust of any
kind, or a fiduciary relationship between the Corporation or
Subsidiary, on the one hand, and a Participant, any
beneficiary or any other person hereunder on the other.
(b) Nothing contained in this Program or in a
Participant's Agreement shall be construed to be a contract
of employment for any term of years nor as conferring upon a
Participant the right to continue in the employ of the
Corporation or Subsidiary in any capacity. It is expressly
understood by the Corporation and each Participant that the
Program and such Participant's Agreement relate exclusively
to additional compensation for such Participant's services,
payable as set forth herein, and are not intended to be an
employment contract.
(c) The Compensation Committee of the Board of
Directors of the Corporation (the "Compensation Committee")
is designated as the Named Fiduciary of and shall administer
this Program. Subject to the provisions of this Program,
the Named Fiduciary will have authority, in its sole
discretion, to determine which key employees of the
Corporation shall be Participants in the Program; any
individual or corporate performance goals applicable to a
Participant; the number of shares of Restricted Stock to be
awarded to a Participant, if any; the restrictions to be
applicable to such shares of Restricted Stock; and all other
terms of the award of Restricted Stock, which need not be
made the same for all Participants. The Named Fiduciary
also shall have full power and authority to interpret,
construe and administer this Program. The Named Fiduciary
shall, in no event, be liable to any person for any action
taken or omitted to be taken in connection with the inter-
pretation, construction, or administration of this Program,
so long as such action or omission to act is made in good
faith. The Compensation Committee, when acting as the Named
Fiduciary, shall operate in accordance with the bylaws of
the Corporation in all respects including, but not limited
to, provisions regarding quorums and voting by the Board of
Directors or a committee thereof.
(d) The Corporation shall deduct any taxes or other
liabilities required by law to be withheld with respect to
the grant or vesting of any shares of Restricted Stock
hereunder, and the granting or vesting of such shares of
Restricted Stock are subject to the condition that such
withholding tax or other withholding liabilities shall have
been satisfied in a manner acceptable to the Corporation.
(e) The Program may be amended, modified, terminated
or suspended by the Board of Directors of the Corporation in
its sole discretion at any time and in any respect as deemed
in the best interest of the Corporation; provided that no
such amendment or modification hereto shall (i) increase the
number of shares of Common Stock which may be awarded as
Restricted Stock under the Program or (ii) without the
consent of a Participant, reduce the amount of any benefit
or adversely change the terms and conditions as specified in
such Participant's Agreement with respect to any outstanding
shares of Restricted Stock. The Board of Directors of the
Corporation shall submit any amendments to the Program to
the shareholders of the Corporation for approval to the
extent necessary to maintain compliance with the
requirements of Rule 16b-3 of the Exchange Act, as amended.
(f) This Program shall be binding upon and inure to
the benefit of the Corporation and Subsidiaries and their
successors and assigns and each Participant, his or her
successors, assigns, heirs, Personal Representative, and
beneficiaries.
(g) Any notice, consent, or demand required or permit-
ted to be given under the provisions of this Program shall
be in writing and shall be signed by the party giving or
making the same. If such notice, consent, or demand is
mailed to a party hereto, it shall be sent by United States
certified mail, postage prepaid, addressed, (i) if to the
Named Fiduciary, to CT Communications, Inc., 68 Cabarrus
Avenue, East, P. O. Box 227, Concord, North Carolina 28026-
0227, Attention: President (ii) if to the Participant, to
the address shown in the Agreement; and (iii) if to another
party, to such party's last known address as shown on the
records of the Corporation. The date of such mailing shall
be deemed to be the date of the notice, consent or demand.
A party may designate a different address for notices by
giving the other party written notice to such effect in the
manner hereinabove prescribed.
(h) Words used herein in the masculine gender shall be
read in the feminine or neuter whenever the context so
requires.
(i) This Program and the rights of the Corporation and
Participant shall be governed by and construed in accordance
with the laws of the State of North Carolina.
(j) The underlying captions set forth in this Program
at the beginning of the various divisions hereof are for
convenience of reference only and shall not be deemed to
define or limit the provisions thereof or to affect in any
way their construction and application.
(k) A Participant may not assign any rights hereunder.
(l) The invalidity of any provision of the Program or
any Agreement shall not in any manner affect the validity of
any other provisions contained herein or therein, and each
and every provision of the Program and any Participant's
Agreement shall be enforceable regardless of the invalidity,
if any, of any other provision contained therein. In the
event that it should be finally judicially determined at any
time that the Program, or a particular grant of Restricted
Stock, is invalid because of the length of its duration,
then, in that event and in that event only, the Program
shall remain in full force and effect for such period as, in
view of all the circumstances, shall be deemed reasonable by
the court passing thereon.
(m) If, under any provision of the Program which
requires a computation of the number of Shares, the number
so computed is not a whole number, such number shall be
rounded up or down to the next closest whole number.
(n) The Program and each respective Agreement set
forth the entire understanding of the parties and supersede
all prior agreements, arrangements and communications,
whether oral or written, pertaining to the shares of
Restricted Stock with respect to each Participant.
(o) The Corporation represents that by proper
corporate action it has been authorized to enter into and be
bound by this Program.
IN WITNESS WHEREOF, the Corporation has executed this
Program as of the day and year first above written.
CT COMMUNICATIONS, INC.
BY: _______________________________
Title _________________________
ATTEST:
Secretary
<PAGE>
PROVISIONS OF NORTH CAROLINA BUSINESS CORPORATION ACT
REGARDING INDEMNIFICATION
"Section 55-8-50. Policy statement and definitions.
(a) It is the public policy of this State to enable
corporations organized under this Chapter to attract and maintain
responsible, qualified directors, officers, employees and agents,
and, to that end, to permit corporations organized under this
Chapter to allocate the risk of personal liability of directors,
officers, employees and agents through indemnification and
insurance as authorized in this Part.
(b) Definitions in this Part:
(1) 'Corporation' includes any domestic or foreign
corporation absorbed in a merger which, if its
separate existence had continued, would have had
the obligation or power to indemnify its
directors, officers, employees, or agents, so that
a person who would have been entitled to receive
or request indemnification from such corporation
if its separate existence had continued shall
stand in the same position under this Part with
respect to the surviving corporation.
(2) 'Director' means an individual who is or was a
director of a corporation or an individual who,
while a director of a corporation, is or was
serving at the corporation's request as a
director, officer, partner, trustee, employee, or
agent of another foreign or domestic corporation,
partnership, joint venture, trust, employee
benefit plan, or other enterprise. A director is
considered to be serving an employee benefit plan
at the corporation's request if his duties to the
corporation also impose duties on, or otherwise
involve services by, him to the plan or to
participants in or beneficiaries of the plan.
'Director' includes, unless the context requires
otherwise, the estate or personal representative
of a director.
(3) 'Expenses' means expenses of every kind incurred
in defending a proceeding, including counsel fees.
(4) 'Liability' means the obligation to pay a
judgment, settlement, penalty, fine (including an
excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred
with respect to a proceeding.
(4a) 'Officer', 'employee', or 'agent' includes, unless
context requires otherwise, the estate or personal
representative of a person who acted in that
capacity.
(5) 'Official capacity' means: (i) when used with
respect to a director, the office of director in a
corporation; and (ii) when used with respect to an
individual other than a director, as contemplated
in G.S. 55-8-56, the office in a corporation held
by the officer or the employment or agency
relationship undertaken by the employee or agent
on behalf of the corporation. 'Official capacity'
does not include service for any other foreign or
domestic corporation or any partnership, joint
venture, trust, employee benefit plan, or other
enterprise.
(6) 'Party' includes an individual who was, is, or is
threatened to be made a named defendant or
respondent in a proceeding.
(7) 'Proceeding' means any threatened, pending, or
completed action, suit, or proceeding, whether
civil, criminal, administrative, or investigative
and whether formal or informal.
Section 55-8-51. Authority to indemnify.
(a) Except as provided in subsection (d), a corporation may
indemnify an individual made a party to a proceeding because he
is or was a director against liability incurred in the proceeding
if:
(1) He conducted himself in good faith; and
(2) He reasonably believed (i) in the case of conduct
in his official capacity with the corporation,
that his conduct was in its best interests; and
(ii) in all other cases, that his conduct was at
least not opposed to its best interests; and
(3) In the case of any criminal proceeding, he had no
reasonable cause to believe his conduct was
unlawful.
(b) A director's conduct with respect to an employee
benefit plan for a purpose he reasonably believed to be in the
interests of the participants in and beneficiaries of the plan is
conduct that satisfies the requirement of subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order,
settlement, conviction, or upon a plea of no contest or its
equivalent is not, of itself, determinative that the director did
not meet the standard of conduct described in this section.
(d) A corporation may not indemnify a director under this
section:
(1) In connection with a proceeding by or in the right
of the corporation in which the director was
adjudged liable to the corporation; or
(2) In connection with any other proceeding charging
improper personal benefit to him, whether or not
involving action in his official capacity, in
which he was adjudged liable on the basis that
personal benefit was improperly received by him.
(e) Indemnification permitted under this section in
connection with a proceeding by or in the right of the
corporation that is concluded without a final adjudication on the
issue of liability is limited to reasonable expenses incurred in
connection with the proceeding.
(f) The authorization, approval or favorable recommendation
by the board of directors of a corporation of indemnification, as
permitted by this section, shall not be deemed an act or
corporate transaction in which a director has a conflict of
interest, and no such indemnification shall be void or voidable
on such ground.
Section 55-8-52. Mandatory indemnification.
Unless limited by its articles of incorporation, a
corporation shall indemnify a director who was wholly successful,
on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the
corporation against reasonable expenses incurred by him in
connection with the proceeding.
Section55-8-53. Advance for expenses.
Expenses incurred by a director in defending a proceeding
may be paid by the corporation in advance of the final
disposition of such proceeding as authorized by the board of
directors in the specific case or as authorized or required under
any provision in the articles of incorporation or bylaws or by
any applicable resolution or contract upon receipt of an
undertaking by or on behalf of the director to repay such amount
unless it shall ultimately be determined that he is entitled to
be indemnified by the corporation against such expenses.
Section 55-8-54. Court-ordered indemnification.
Unless a corporation's articles of incorporation provide
otherwise, a director of the corporation who is a party to a
proceeding may apply for indemnification to the court conducting
the proceeding or to another court of competent jurisdiction. On
receipt of an application, the court after giving any notice the
court considers necessary may order indemnification if it
determines:
(1) The director is entitled to mandatory
indemnification under G.S. 55-8-52, in which case
the court shall also order the corporation to pay
the director's reasonable expenses incurred to
obtain court-ordered indemnification; or
(2) The director is fairly and reasonably entitled to
indemnification in view of all the relevant
circumstances, whether or not he met the standard
of conduct set forth in G.S. 55-8-51 or was
adjudged liable as described in G.S. 55-8-51(d),
but if he was adjudged so liable his
indemnification is limited to reasonable expenses
incurred.
Section 55-8-55. Determination and authorization of indemnification.
(a) A corporation may not indemnify a director under
G.S. 55-8-51 unless authorized in the specific case after a
determination has been made that indemnification of the director
is permissible in the circumstances because he has met the
standard of conduct set forth in G.S. 55-8-51.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a
quorum consisting of directors not at the time
parties to the proceeding;
(2) If a quorum cannot be obtained under subdivision
(1), by majority vote of a committee duly
designated by the board of directors (in which
designation directors who are parties may
participate), consisting solely of two or more
directors not at the time parties to the
proceeding;
(3) By special legal counsel (i) selected by the board
of directors or its committee in the manner
prescribed in subdivision (1) or (2); or (ii) if a
quorum of the board of directors cannot be
obtained under subdivision (1) and a committee
cannot be designated under subdivision (2),
selected by majority vote of the full board of
directors (in which selection directors who are
parties may participate); or
(4) By the shareholders, but shares owned by or voted
under the control of directors who are at the time
parties to the proceeding may not be voted on the
determination.
(c) Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same manner as
the determination that indemnification is permissible, except
that if the determination is made by special legal counsel,
authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled under
subsection (b)(3) to select counsel.
Section 55-8-56. Indemnification of officers, employees, and agents.
Unless a corporation's articles of incorporation provide
otherwise:
(1) An officer of the corporation is entitled to
mandatory indemnification under G.S. 55-8-52, and
is entitled to apply for court-ordered
indemnification under G.S. 55-8-54, in each case
to the same extent as a director;
(2) The corporation may indemnify and advance expenses
under this Part to an officer, employee, or agent
of the corporation to the same extent as to a
director; and
(3) A corporation may also indemnify and advance
expenses to an officer, employee, or agent who is
not a director to the extent, consistent with
public policy, that may be provided by its
articles of incorporation, bylaws, general or
specific action of its board of directors, or
contract.
Section 55-8-57. Additional indemnification and insurance.
(a) In addition to and separate and apart from the
indemnification provided for in G.S. 55-8-51, 55-8-52, 55-8-54,
55-8-55 and 55-8-56, a corporation may in its articles of
incorporation or bylaws or by contract or resolution indemnify or
agree to indemnify any one or more of its directors, officers,
employees, or agents against liability and expenses in any
proceeding (including without limitation a proceeding brought by
or on behalf of the corporation itself) arising out of their
status as such or their activities in any of the foregoing
capacities; provided, however, that a corporation may not
indemnify or agree to indemnify a person against liability or
expenses he may incur on account of his activities which were at
the time taken known or believed by him to be clearly in conflict
with the best interests of the corporation. A corporation may
likewise and to the same extent indemnify or agree to indemnify
any person who, at the request of the corporation, is or was
serving as a director, officer, partner, trustee, employee, or
agent of another foreign or domestic corporation, partnership,
joint venture, trust or other enterprise or as trustee or
administrator under an employee benefit plan. Any provision in
any articles of incorporation, bylaw, contract, or resolution
permitted under this section may include provisions for recovery
from the corporation of reasonable costs, expenses, and
attorneys' fees in connection with the enforcement of rights to
indemnification granted therein and may further include
provisions establishing reasonable procedures for determining and
enforcing the rights granted therein.
(b) The authorization, adoption, approval, or favorable
recommendation by the board of directors of a public corporation
of any provision in any articles of incorporation, bylaw,
contract or resolution, as permitted in this section, shall not
be deemed an act or corporate transaction in which a director has
a conflict of interest, and no such articles of incorporation or
bylaw provision or contract or resolution shall be void or
voidable on such grounds. The authorization, adoption, approval,
or favorable recommendation by the board of directors of a
nonpublic corporation of any provision in any articles of
incorporation, bylaw, contract or resolution, as permitted in
this section, which occurred on or prior to July 1, 1990, shall
not be deemed an act or corporate transaction in which a director
has a conflict of interest, and no such articles of
incorporation, bylaw provision, contract or resolution shall be
void or voidable on such grounds. Except as permitted in
G.S. 55-8-31, no such bylaw, contract, or resolution not adopted,
authorized, approved or ratified by shareholders shall be
effective as to claims made or liabilities asserted against any
director prior to its adoption, authorization, or approval by the
board of directors.
(c) A corporation may purchase and maintain insurance on
behalf of an individual who is or was a director, officer,
employee, or agent of the corporation, or who, while a director,
officer, employee, or agent of the corporation, is or was serving
at the request of the corporation as a director, officer,
partner, trustee, employee, or agent of another foreign or
domestic corporation, partnership, joint venture, trust, employee
benefit plan, or other enterprise, against liability asserted
against or incurred by him in that capacity or arising from his
status as a director, officer, employee, or agent, whether or not
the corporation would have power to indemnify him against the
same liability under any provision of this act.
Section 55-8-58. Application of Part.
(a) If articles of incorporation limit indemnification or
advance for expenses, indemnification and advance for expenses
are valid only to the extent consistent with the articles.
(b) This Part does not limit a corporation's power to pay
or reimburse expenses incurred by a director in connection with
his appearance as a witness in a proceeding at a time when he has
not been made a named defendant or respondent to the proceeding.
(c) This Part shall not affect rights or liabilities
arising out of acts or omissions occurring before July 1, 1990."
