<PAGE> 1
GBC BANCORP
800 WEST SIXTH STREET
LOS ANGELES, CALIFORNIA 90017
(GBC LOGO)
TO THE SHAREHOLDERS OF GBC BANCORP:
NOTICE IS HEREBY GIVEN that, pursuant to the call of its Board of
Directors, the Annual Meeting of Shareholders (the "Meeting") of GBC Bancorp
("Bancorp") will be held in the Corporate Board Room of Bancorp, located at 800
West Sixth Street, 15th Floor, Los Angeles, California 90017, on Thursday, April
22, 1999 at 4:00 p.m., for the purpose of considering and voting on the
following matters:
1. ELECTION OF DIRECTORS. To elect fourteen directors to serve for the
ensuing year.
2. APPROVAL OF THE GBC BANCORP 1999 EMPLOYEE STOCK INCENTIVE PLAN. To act
upon a proposal, which the Board of Directors supports, to approve the
GBC Bancorp 1999 Employee Stock Incentive Plan.
3. OTHER BUSINESS. To transact such other business as may properly come
before the meeting and any adjournments thereof.
The Board of Directors has fixed the close of business on February 28, 1999
as the record date for determination of shareholders entitled to notice of, and
the right to vote at the Meeting.
YOU ARE URGED TO VOTE IN FAVOR OF THE PROPOSALS BY SIGNING AND RETURNING
THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE, WHETHER OR NOT YOU PLAN TO ATTEND
THE MEETING IN PERSON. THE ENCLOSED PROXY IS SOLICITED BY BANCORP'S BOARD OF
DIRECTORS. ANY SHAREHOLDER GIVING A PROXY MAY REVOKE IT PRIOR TO THE TIME IT IS
VOTED BY NOTIFYING THE SECRETARY IN WRITING TO THAT EFFECT, BY FILING WITH HIM A
LATER DATED PROXY, OR BY VOTING IN PERSON AT THE MEETING.
By Order of the Board of Directors
/s/ PETER WU
-------------------
Peter Wu
Secretary
Dated: March 22, 1999
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PROXY STATEMENT
GBC BANCORP
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 22, 1999
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
the Proxies to be used at the Annual Meeting of Shareholders (the "Meeting") of
GBC Bancorp ("Bancorp") to be held on Thursday, April 22, 1999 at 4:00 p.m., in
the Corporate Board Room of Bancorp, 800 West Sixth Street, 15th Floor, Los
Angeles, California 90017, and at any adjournment thereof.
It is expected that this Proxy Statement and accompanying Notice and form
of Proxy will be mailed to shareholders on or about March 22, 1999.
The matters to be considered and voted upon at the Meeting will be:
1. ELECTION OF DIRECTORS. To elect fourteen directors to serve for the
ensuing year.
2. APPROVAL OF THE GBC BANCORP 1999 EMPLOYEE STOCK INCENTIVE PLAN. To act
upon a proposal, which the Board of Directors supports, to approve the
GBC Bancorp 1999 Employee Stock Incentive Plan.
3. OTHER BUSINESS. To transact such other business as may properly come
before the meeting and any adjournments thereof.
REVOCABILITY OF PROXIES
A Proxy for use at the Meeting is enclosed. Any shareholder who executes
and delivers such Proxy has the right to revoke it at any time before it is
exercised by filing with the Secretary of Bancorp an instrument revoking it or a
duly-executed Proxy bearing a later date. In addition, the powers of the
proxyholders will be suspended if the person executing the Proxy is present at
the Meeting and elects to vote in person by advising the Chairman of the Meeting
of his/her election to vote in person, and voting in person at the Meeting.
Subject to such revocation or suspension, all shares represented by a properly
executed Proxy received in time for the Meeting will be voted by the
proxyholders in accordance with the instructions on the Proxy. If no instruction
is specified with regard to a matter to be acted upon, the shares represented by
the proxy will be voted in accordance with the recommendations of management.
Abstentions and broker non-votes are not considered votes cast.
PERSONS MAKING THE SOLICITATION
This solicitation of Proxies is being made by the Board of Directors of
Bancorp. The expense of preparing, assembling, printing, and mailing this Proxy
Statement and the materials used in the solicitation of Proxies for the Meeting
will be borne by Bancorp. It is contemplated that Proxies will be solicited
principally through the use of the mail, but officers, directors, and employees
of Bancorp may solicit Proxies personally or by telephone without receiving
special compensation therefor. Bancorp may reimburse banks, brokerage houses and
other custodians, nominees and fiduciaries for their reasonable expenses in
forwarding these Proxy materials to their principals. In addition, Bancorp may
utilize the services of individuals or companies not regularly employed by
Bancorp in connection with the solicitation of Proxies, if management of Bancorp
determines that this is advisable.
VOTING SECURITIES
There were issued and outstanding 13,665,098 shares of Bancorp's common
stock ("Common Stock") on February 28, 1999 which has been fixed as the record
date (the "Record Date") for the purpose of
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determining shareholders entitled to notice of, and to vote at, the Meeting.
Each holder of Bancorp's Common Stock will be entitled to one vote, in person or
by proxy, for each share of Common Stock held as of the Record Date on any
matter submitted to the vote of the shareholders.
SHAREHOLDINGS OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
BY MANAGEMENT
The following table sets forth, as of January 31, 1999, the number and
percentage of shares of Bancorp's outstanding Common Stock beneficially owned,
directly or indirectly, by each of Bancorp's directors, and the executive
officers included in the Summary Compensation Table set forth under the caption
"EXECUTIVE COMPENSATION" on page 10, and by the directors and officers as a
group. The shares "beneficially owned" are determined under Securities and
Exchange Commission Rules, and do not necessarily indicate ownership for any
other purpose. In general, beneficial ownership includes shares over which
director, principal shareholder, or officer has sole or shared voting or
investment power and shares which such person has the right to acquire within 60
days of January 31, 1999. Unless otherwise indicated, the persons listed below
have sole voting and investment powers of the shares beneficially owned.
Management is not aware of any arrangements which may, at a subsequent date,
result in a change of control of Bancorp.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENTAGE OF CLASS
---------------- -------------------- -------------------
<S> <C> <C>
Helen Chen 386,560(1) 2.83%
Thomas C. T. Chiu 113,100(2) 0.83%
Chuang-I Lin 56,500(3) 0.41%
Ko-Yen Lin 119,800(4) 0.88%
Ting Y. Liu 386,786(5) 2.83%
John Wang 63,984(6) 0.47%
Kenneth C. Wang 63,984(7) 0.47%
Chien-Te Wu 179,280 1.31%
Julian Wu 80,614(8) 0.59%
Li-Pei Wu 477,912(9) 3.38%
Peter Wu 560,424(10) 4.09%
Ping C. Wu 666,904(11) 4.88%
Walter Wu 127,382(12) 0.93%
Chin-Liang Yen 417,122(13) 3.05%
26 Present Directors and Officers as
a group 3,803,280 26.71%
</TABLE>
- ---------------
(1) Includes 338,500 shares held by the Helen Y. Chen Revocable Living Trust,
Helen Y. Chen, Trustee, as to which shares Ms. Chen has sole voting and
investment powers. Also includes 48,060 shares held by Ms. Chen's children
in their own names, as to which shares Ms. Chen has shared voting and
investment powers.
(2) Includes 82,280 shares held jointly with Dr. Chiu's spouse, 9,680 shares
held by Dr. Chiu in his own name, 16,940 shares held by Dr. Chiu's spouse
in her own name, as to which shares Dr. Chiu has shared voting and
investment powers, and 4,200 shares owned by Dr. Chiu's Pension Fund.
(3) Includes 56,000 shares owned by Myriad Capital, Inc., which is 95% owned by
Mr. Lin, as to which shares Mr. Lin has shared voting and investment
powers. Also includes 500 shares owned by Mr. Lin's spouse, as to which
shares Mr. Lin has shared voting and investment power.
(4) Includes 100,000 shares held on behalf of Mr. Lin by Thomas Green
Securities Inc.
(5) Includes 383,156 shares held jointly with Mr. Liu's spouse, and 3,630
shares held by Jade Realty Pension Trust which is 100% owned by Mr. Liu, as
to which shares Mr. Liu has voting and investment powers.
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(6) Does not include 102,730 shares held by Mr. Wang's mother and 63,984 shares
held by his non-director brother, Michael Wang, as to which shares Mr. Wang
holds a power to vote in accordance with their instructions. Mr. Wang
disclaims beneficial ownership of these shares.
(7) Does not include 102,730 shares held by Mr. Wang's mother and 63,984 shares
held by his non-director brother, Michael Wang, as to which shares Mr. Wang
holds a power to vote in accordance with their instructions. Mr. Wang
disclaims beneficial ownership of these shares.
(8) Includes 7,260 shares held by Unison Investment of which Mr. Wu is the
General Partner. Does not include 2,420 shares held by Mr. Wu's children in
their own names, as to which shares Mr. Wu has no voting and investment
powers. Also does not include 309,734 shares held by Mr. Wu's brothers and
sisters in their own names, as to which shares Mr. Wu holds a power of
attorney to vote in accordance with their instructions. Mr. Wu disclaims
beneficial ownership of these shares.
(9) Includes 1,650 shares held jointly with Mr. Wu's spouse, as to which shares
Mr. Wu has shared voting and investment powers, and 262 shares held on
behalf of Mr. Wu by Merrill Lynch, Pierce, Fenner & Smith, Inc. Also
includes 476,000 shares subject to options presently exercisable or which
will become exercisable within 60 days.
(10) Includes 432,204 shares held under Wu Trust UA 6-19-91. Also includes
26,008 shares held by Mr. Wu's children under the California Uniform
Transfers to Minors Act, Chong Hwei Wu, Custodian, as to all of which
shares Mr. Wu has shared voting and investment powers. Also includes 9,212
shares held on behalf of Mr. Wu by Fidelity Management & Research Co., and
69,800 shares by Wedbush Morgan Securities. Also includes 23,200 shares
subject to options presently exercisable or which will become exercisable
within 60 days.
(11) Includes 172,464 shares owned by President Global Corp., as to which shares
Mr. Wu has sole voting and investment powers. Also includes 396,724 shares
held under the Wu Family 1998 Trust, 2,056 shares held by Mr. Wu's defined
benefit plan, 6,654 shares held by Mrs. Wu's defined benefit plan, and a
total of 89,006 shares held by Mr. Wu's children in their own names, as to
all of which shares Mr. Wu has shared voting and investment powers.
(12) Includes 33,332 shares held jointly with Mr. Wu's spouse and 20,000 shares
held by Mr. Wu's spouse as trustee, as to which shares Mr. Wu has shared
voting and investment powers.
(13) Includes 297,340 shares held jointly with Ms. Yen's spouse and 119,782
shares held by Ms. Yen's children in their own names, as to which shares
Ms. Yen has shared voting and investment powers.
BY OTHERS
FMR Corp. of 82 Devonshire Street, Boston, Massachusetts 02109 has reported
in a filing on Schedule 13G/A under the Securities Exchange Act of 1934 that its
wholly-owned subsidiary Fidelity Management & Research Company ("Fidelity"), in
its capacity as an investment adviser registered under the Investment Advisers
Act of 1940, is the beneficial owner of 857,500 shares of Bancorp's Common
Stock, constituting 6.054% of Common Stock outstanding as of December 31, 1998.
Such shares are owned by one investment company, Fidelity Low-Priced Stock Fund.
FMR Corp., through its control of Fidelity, FMR Corp.'s Chairman, Edward C.
Johnson 3d, and the fund each has the sole power to dispose of the shares owned
by the fund, but neither FMR Corp. nor Edward C. Johnson 3d has the sole power
to vote or direct the voting of the shares, which power resides in the Board of
Trustees of the Fidelity funds. FMR Corp. states in its Schedule 13G/A filing
that by virtue of the ownership of FMR Corp. stock and a shareholders' voting
agreement members of the Edward C. Johnson 3d family group may be deemed to form
a controlling group with respect to FMR Corp. under the Investment Company Act
of 1940. Reference is made to such Schedule 13G/A filing with the Securities and
Exchange Commission (the "SEC") for further information with respect to the
beneficial ownership of such shares.
The Board of Directors knows of no other person who owns, beneficially or
of record either individually or together with associates, 5% or more of the
outstanding shares of Bancorp's Common Stock.
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ELECTION OF DIRECTORS
The persons named below have been nominated to serve as directors of
Bancorp until the 2000 Annual Meeting of Shareholders and until their respective
successors are elected and qualify, and management does not intend to nominate
any other persons as directors at this Annual Meeting. There are no family
relationships between any director, executive officer or person nominated to
become a director or executive officer, except: (i) Peter Wu, Ping C. Wu and
Chien-Te Wu are brothers and are first cousins to Julian Wu; and (ii) John Wang
and Kenneth Wang are brothers. The term family relationship means any
relationship by blood, marriage or adoption not more remote than first cousin.
The following is a brief biographical description of each nominee. Each of the
nominees was elected to his or her present term of office at Bancorp's last
Annual Meeting of Shareholders.
<TABLE>
<CAPTION>
BANCORP
DIRECTOR PRINCIPAL OCCUPATION
NAME AGE SINCE DURING THE PAST FIVE YEARS
---- --- -------- --------------------------
<S> <C> <C> <C>
Helen Y. Chen 56 1986 From 1974 to present, Vice President of Fullong
Enterprise Corp.
Thomas C.T. Chiu 51 1983 Medical doctor.
Chuang-I Lin, Ph.D. 58 1983 1980 to present, Chairman and President of Myriad
Capital, Inc.
Ko-Yen Lin 55 1986 1977 to present, President of T. K. Lin Investment Co.,
Calabasas, CA.
Ting Y. Liu, Ph.D. 62 1981 From 1984 to present, Chairman, Phoenix Hotel Group,
Inc.; and since July 1994, Chairman of General Link
Inc., Chatsworth, CA.
John C. Wang 36 1989 From 1987 to present, Vice President of The Wang
Partnership; 1990 to present, Managing Director of South
Bay Capital Corporation; and since 1991 President,
Pacific Coast Realty Services, Inc.
Kenneth C. Wang 38 1991 From 1986 to present, Executive Vice President of The
Wang Partnership, and from 1993 to present, Executive
Vice President of Kenjohn Trading.
Chien-Te Wu 37 1994 From September 1990 to July 1993, Executive Vice
President, and since August 1993 to present, President,
of Tone Yee Investments & Developments.
Julian Wu, Ph.D. 57 1981 1977 to present, General Partner of West Union
Investment Co., Torrance, CA.
Li-Pei Wu 64 1982 From May 1982 to present, Chief Executive Officer and
from June 1984 to present, also Chairman of the Board of
Bancorp and General Bank. President of Bancorp and
General Bank from May 1982 to March 1998.
Peter Wu, Ph.D. 50 1981 From 1979 to March 1998, Executive Vice President and
since January 1995, also Chief Operating Officer, of
General Bank; from 1981 to March 1998, Executive Vice
President of Bancorp. Elected President and Chief
Operating Officer of Bancorp and General Bank in March
1998. Presently also Secretary of Bancorp and General
Bank.
Ping C. Wu 53 1981 1975 to present, President of President Global Corp.,
Buena Park, CA.
Walter Wu 53 1981 1984 to present, President of Wenix International Corp.
Chin-Liang Yen 56 1983 From 1986 to present, President of San Yang Enterprises
Corp.
</TABLE>
The enclosed Proxy will be voted in favor of the election of the
above-named nominees as directors, unless authority to vote for directors is
withheld. If any of the nominees should be unable or decline to serve, which is
not anticipated, discretionary authority is reserved for the proxyholders to
vote for a substitute, to be designated by the present Board of Directors.
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THE BOARD OF DIRECTORS AND COMMITTEES
As of December 31, 1998, there were fourteen directors of Bancorp. Bancorp
had eleven (11) special Board of Directors meetings in 1998. All fourteen
directors attended more than 75% of the Board Meetings of Bancorp with the
exception of Mr. Kenneth Wang. Bancorp does not have any standing audit,
compensation, nominating or personnel committee.
The Board of Directors of General Bank (the "Bank") had twelve (12) regular
meetings during the year 1998. Members of the Board of Directors of the Bank
also attended thirty-one (31) loan committee meetings during the year 1998. The
Bank has an audit committee composed of seven outside directors which met four
(4) times in 1998. The audit committee reviews audits of the Bank and considers
the adequacy of auditing procedures.
DIRECTORS' COMPENSATION
Each director who attends the regular Board of Directors meetings of the
Bank is paid $1,600.00 for each attendance. Any director who does not attend is
paid $1,000.00 per meeting. Directors are not paid any fee for attending special
Board Meetings unless agreed to by a majority of the Board of Directors.
Directors are not paid any fee for attending Board Meetings of Bancorp.
Non-employee directors who are members of and attend meetings of the various
committees of the Board of Directors of the Bank are paid attendance fees as
follows: (a) $600.00 per attendance at a loan committee meeting; (b) $500.00 per
attendance at a CRA committee meeting; and (c) $500.00 per attendance at an
audit committee meeting. In addition, the audit committee Chair receives a
$3,000.00 annual retainer.
Pursuant to a program to grant non-qualified options for Bancorp's Common
Stock to the non-employee directors, immediately after the Company's last Annual
Meeting of Shareholders held on May 7, 1998, each of the twelve (12)
non-employee directors elected was granted a non-qualified option to purchase
20,000 shares of Common Stock, with the exercise price of the options to be the
fair market value of the Common Stock on the date of said meeting. The program
further provides that, beginning on January 1, 1999 and continuing thereafter on
January 1 of each succeeding year, each non-employee director serving on such
date who shall have served as a director for at least one year as of such date
will be granted a non-qualified option to purchase 3,000 shares of Common Stock
with an exercise price equal to the fair market value of the Common Stock on the
first business day of each such year, with such option to vest on the one year
anniversary date of the grant thereof. All options granted under the program
will be fully exercisable on the first anniversary date of the grant and will be
exercisable over a ten (10)-year period from the date of the grant.
APPROVAL OF THE GBC BANCORP 1999 EMPLOYEE
STOCK INCENTIVE PLAN
GENERAL
In January 1999, the Board of Directors of Bancorp (the "Board") adopted
the GBC Bancorp 1999 Employee Stock Incentive Plan (the "Plan") pursuant to
which employees, non-employee directors and consultants of Bancorp, its
subsidiaries and certain affiliates are eligible to receive shares of Common
Stock of Bancorp or other securities or benefits with a value derived from the
value of the Common Stock of Bancorp. A copy of the Plan is attached to this
Proxy Statement as Appendix A. The following is a brief summary of the Plan,
which is qualified in its entirety by reference to Appendix A.
The purpose of the Plan is to enable Bancorp to attract, retain and
motivate employees, non-employee directors and consultants by providing for or
increasing their proprietary interests in Bancorp and, thereby, further align
their interests with those of Bancorp's shareholders.
The maximum number of shares of Common Stock that may be issued pursuant to
awards granted under the Plan may not exceed the sum of (i) 1,000,000 shares,
including any shares issuable pursuant to that certain Employment Agreement
dated as of January 1, 1998, between Bancorp and Li-Pei Wu, as the same may be
amended from time to time (see "EXECUTIVE COMPENSATION -- Employment Agreement"
5
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on pages 14-16), (ii) any shares available for future awards under any prior
plan of Bancorp as of the effective date of the Plan and (iii) any shares
subject to awards granted under any prior plan of Bancorp which are forfeited,
expire or are canceled without delivery of shares (subject to adjustment to
prevent dilution).
ADMINISTRATION
The Plan is administered by the Board or, at the election of the Board, may
be administered by a committee of two or more directors appointed by the Board,
each of whom is an "outside director" within the meaning of Section 162(m) of
the Internal Revenue Code of 1986, as amended (the "Code"), and who otherwise
comply with the requirements of Rule 16b-3 promulgated under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). The term "Committee"
shall mean the Board or any such committee of the Board designated by the Board
to administer the Plan. The Committee has full and final authority to select the
recipients of awards and to grant such awards. Subject to the provisions of the
Plan, the Committee has a wide degree of flexibility in determining the terms
and conditions of awards and the number of shares to be issued pursuant thereto,
including conditioning the receipt or vesting of awards upon the achievement by
Bancorp of specified performance criteria. The expenses of administering the
Plan are borne by Bancorp.
TERMS OF AWARDS
The Plan authorizes the Committee to enter into any type of arrangement
with an eligible recipient that, by its terms, involves or might involve the
issuance of Common Stock or any other security or benefit with a value derived
from the value of Common Stock. Awards are not restricted to any specified form
or structure and may include, without limitation, sales or bonuses of stock,
restricted stock, stock options, reload stock options, stock purchase warrants,
other rights to acquire stock, securities convertible into or redeemable for
stock, stock appreciation rights, phantom stock, dividend equivalents,
performance units or performance shares. An award may consist of one such
security or benefit or two or more of them in tandem or in the alternative.
An award granted under the Plan may include a provision accelerating the
receipt of benefits upon the occurrence of specified events, such as a change of
control of Bancorp or a dissolution, liquidation, merger, reclassification, sale
of substantially all of the property and assets of Bancorp or other significant
corporate transactions. The Committee may grant options that either are intended
to be "incentive stock options" as defined under Section 422 of the Code, or are
not intended to be incentive stock options ("non-qualified stock options").
Awards to consultants and non-employee directors may only be non-qualified stock
options.
An award may permit the recipient to pay all or part of the purchase price
of the shares or other property issuable pursuant thereto, or to pay all or part
of such recipient's tax withholding obligation with respect to such issuance, by
(i) delivering previously owned shares of capital stock of Bancorp or other
property or (ii) reducing the amount of shares or other property otherwise
issuable pursuant to the award or (iii) delivering a promissory note, the terms
and conditions of which will be determined by the Committee. If an award permits
the recipient to pay for the shares issuable pursuant thereto with previously
owned shares, the recipient would be able to exercise the award in successive
transactions, starting with a relatively small number of shares and, by a series
of exercises using shares acquired from each such transaction to pay the
purchase price of the shares acquired in the following transaction, to exercise
an award for a large number of shares with no more investment than the original
share or shares delivered. The exercise price and any withholding taxes are
payable in cash by consultants and non-employee directors, although the
Committee at its discretion may permit such payment by delivery of shares of
Common Stock, or by delivery of broker instructions authorizing a loan secured
by the shares acquired upon exercise or payment of proceeds from the sale of
such shares.
Subject to limitations imposed by law, the Board may amend or terminate the
Plan at any time and in any manner. However, no such amendment or termination
may deprive the recipient of an award previously granted under the Plan or any
rights thereunder without the recipient's consent.
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Pursuant to Section 16(b) of the Exchange Act, directors, certain officers
and ten percent shareholders of Bancorp are generally liable to Bancorp for
repayment of any "short-swing" profits realized from any non-exempt purchase and
sale of Common Stock occurring within a six-month period. Rule 16b-3,
promulgated under the Exchange Act, provides an exemption from Section 16(b)
liability for certain transactions by an officer or director pursuant to an
employee benefit plan that complies with such Rule. Specifically, the grant of
an option under an employee benefit plan that complies with Rule 16b-3 will not
be deemed a purchase of a security for purposes of Section 16(b). The Plan is
designed to comply with Rule 16b-3.
Awards may not be granted under the Plan after the tenth anniversary of the
adoption of the Plan. Although any award that was duly granted on or prior to
such date may thereafter be exercised or settled in accordance with its terms,
no shares of Common Stock may be issued pursuant to any award after the
twentieth anniversary of the adoption of the Plan.
The business criteria on which performance goals are based under the Plan
will be determined on a case-by-case basis, except that with respect to stock
options and stock appreciation rights compensation is based on increases in the
value of the Common Stock after the date of grant of award. Similarly, the
maximum amount of compensation that could be paid to any participant or the
formula used to calculate the amount of compensation to be paid to the
participant if a performance goal is obtained will be determined on a case-by-
case basis, except that in the case of stock options the maximum possible
compensation will be calculated as the difference between the exercise price of
the option and the fair market value of the Common Stock on the date of option
exercise, times the maximum number of shares for which grants may be made to any
participant.
Bancorp intends to register under the Securities Act of 1933, as amended,
the shares of Common Stock issuable pursuant to the Plan.
FEDERAL INCOME TAX TREATMENT
The following is a brief description of the federal income tax treatment
that generally will apply to awards made under the Plan, based on federal income
tax laws in effect on the date hereof. The exact federal income tax treatment of
any award will depend on the specific nature of such award. Such an award may,
depending on the conditions applicable to the award, be taxable as an option, an
award of restricted or unrestricted stock, an award which is payable in cash or
otherwise. The following discussion is based on present federal tax laws and
regulations and does not purport to be complete. Participants may also be
subject to foreign, state and local taxes which are not described below.
INCENTIVE STOCK OPTIONS
Pursuant to the Plan, participants may be granted options which are
intended to qualify as incentive stock options. Generally, the optionee is not
taxed, and Bancorp is not entitled to a deduction, on the grant or exercise of
an incentive stock option. However, if the optionee sells the shares acquired
upon the exercise of an incentive stock option at any time within (i) one year
after the date of exercise of the option or (ii) two years after the date of
grant of the option (a "disqualifying disposition"), then the optionee will
recognize ordinary income in an amount equal to the excess, if any, of the
lesser of the sale price or the fair market value on the date of exercise over
the exercise price of the option. Bancorp generally will be entitled to a
deduction in an amount equal to the amount of ordinary income recognized by the
optionee.
In addition to the regular income tax, an optionee may be subject to the
federal alternative minimum tax if his or her alternative minimum taxable income
("AMTI") exceeds certain amounts. The excess of the fair market value of the
stock received upon exercise of an incentive stock option over the exercise
price generally is includable in the participant's AMTI. In the case of a
participant who exercises an incentive stock option within six months after its
date of grant and whose sale of stock could subject him or her to suit under
Section 16(b) of the Exchange Act, generally the excess of the fair market value
over the exercise price on the date six months following the date of grant is
includable in AMTI. However, if a disqualifying disposition occurs at a loss in
the same taxable year that the excess was includable in AMTI, the includable
amount is limited to the excess of the amount realized on the disqualifying
disposition over the exercise price. For the
7
<PAGE> 9
purpose of the alternative minimum tax, the gain or loss on sale of stock is
calculated by including a basis adjustment for the amount included in AMTI upon
exercise.
If the holder of an incentive stock option pays the exercise price with
previously acquired shares of stock, the exchange should not affect the
incentive stock option tax treatment of the option exercised. However, if stock
previously acquired through the exercise of an incentive stock option is used to
pay the exercise price, then the exchange of the previously acquired shares of
stock will be considered a disposition of such shares for the purpose of
determining whether a disqualifying disposition has occurred. Otherwise,
generally no gain or loss is recognized on the exchange, and the shares of stock
received by the participant which are equal in number to the previously acquired
shares exchanged therefor will have the same basis and holding period for
long-term capital gain purposes as the previously acquired shares. However, the
optionee will not be able to utilize the old holding period for the purpose of
satisfying the incentive stock option one-year and two-year holding period
requirements. Shares of stock received by the optionee in excess of the number
of previously acquired shares generally will have a basis of zero and a holding
period which commences as of the date the shares of stock are issued to the
optionee upon exercise of the incentive stock option.
NON-QUALIFIED STOCK OPTIONS
The grant of an option or other similar right to acquire stock that does
not qualify for treatment as an incentive stock option generally is not a
taxable event for the optionee. Upon exercise of such an option, the optionee
generally will recognize ordinary income in an amount equal to the excess of the
fair market value of the stock acquired upon exercise (determined as of the date
of exercise) over the exercise price of such option, and Bancorp will be
entitled to a deduction equal to such amount.
Special rules will apply, however, if the optionee is subject to Section 16
of the Exchange Act and during any period of time (the "Section 16(b) Period") a
sale of the stock acquired upon exercise of the option could subject such
optionee to suit under Section 16. In such case, the optionee will not recognize
ordinary income, and Bancorp will not be entitled to a deduction, until the
expiration of the Section 16(b) Period. Upon such expiration, the optionee will
recognize ordinary income, and Bancorp will be entitled to a deduction, equal to
the excess of the fair market value of the stock (determined as of the
expiration of the Section 16(b) Period) over the option exercise price. Such an
optionee may elect under Section 83(b) of the Code to recognize ordinary income
on the date of exercise, in which case Bancorp would be entitled to a deduction
at that time equal to the amount of the ordinary income recognized. Such an
election must be filed within 30 days after the stock is considered to be
received for income tax purposes.
If a holder of a non-qualified stock option pays the exercise price in
cash, his or her basis in the shares acquired is equal to the fair market value
of the stock on the date ordinary income is recognized and, upon subsequent
disposition, any further gain or loss is taxable either as a short-term or
long-term capital gain or loss, depending on how long the shares of stock are
held. The holding period for such shares commences as of the date ordinary
income is recognized.
If a holder of a non-qualified stock option pays the exercise price with
previously acquired shares of stock, he or she will recognize ordinary income in
an amount equal to the excess of the fair market value of the stock received
over the exercise price. No additional gain or loss is recognized as a result of
the disposition of previously acquired shares of stock. The shares of stock
received by the participant, equal in number to the previously acquired shares
exchanged therefor, will have the same basis and holding period as such
previously acquired shares. The shares of stock received by the participant in
excess of the number of previously acquired shares will have a basis equal to
the fair market value of such additional shares as of the date ordinary income
is recognized. The holding period for such additional shares will commence as of
the date ordinary income is recognized.
Generally, gain or loss from a disposition of shares is characterized as
"short-term" for shares held for 12 months or less, and "long term" if held more
than 12 months. Short-term capital gains are taxed at ordinary income rates,
while long-term capital gains are normally taxed at a rate of twenty percent
(20%).
8
<PAGE> 10
OTHER TYPES OF AWARDS
Awards under the Plan may also include stock sales, stock bonuses or other
grants of stock. Stock issued pursuant to these awards may be subject to certain
restrictions. Pursuant to Section 83 of the Code, stock sold or granted under
the Plan will give rise to taxable income at the earliest time at which such
stock is not subject to a substantial risk of forfeiture or is freely
transferable for purposes of Section 83. At that time, the holder will recognize
ordinary income equal to the excess of the fair market value of the shares
(determined as of such time) over the purchase price, and Bancorp will be
entitled to a deduction equal to such amount. If the holder of the stock is a
person subject to Section 16(b) and if the sale of the stock at a profit could
subject such person to suit under Section 16(b), income will be recognized in
accordance with the rules described above regarding stock issued to such persons
upon the exercise of an option, unless the holder makes a timely election under
Section 83(b) to recognize income on the date the stock is issued.
Awards may also be granted under the Plan that do not fall clearly into the
categories described above. The federal income tax treatment of these awards
will depend upon the specific terms of such awards.
WITHHOLDING
Bancorp generally will be required to withhold applicable taxes with
respect to any ordinary income recognized by a participant upon exercise of a
non-qualified stock option or recognition of income in connection with awards
made under the Plan.
LIMITATIONS ON DEDUCTIBILITY
The terms of the agreements pursuant to which specific awards are made
under the Plan may provide for accelerated vesting or payment of an award in
connection with a change in ownership or control of Bancorp. In that event and
depending upon the individual circumstances of the recipient, certain amounts
with respect to such awards may constitute "excess parachute payments" under the
golden parachute provisions of the Code. Pursuant to such provisions, an
employee will be subject to a 20% excise tax on any "excess parachute payment,"
and Bancorp will be denied any deduction with respect to such excess parachute
payment.
In addition, Section 162(m) of the Code renders nondeductible to Bancorp
certain compensation paid to the Chief Executive Officer and four other most
highly compensated executives in excess of $1,000,000 in any year unless such
excess compensation is "performance-based" (as defined in the Code) or is
otherwise exempt from these limitations on deductibility. Options granted under
the Plan at an exercise price equal to their fair market value at the date of
grant are intended to qualify for the exemption for performance-based
compensation under Section 162(m). However, in light of the ambiguities in
Section 162(m) and uncertainties regarding the ultimate interpretation and
application in these circumstances, no assurances can be given that the
compensation paid under the Plan to any such executive officer will in fact be
deductible, if it should, together with other non-exempt compensation paid to
such executive officer, exceed the $1,000,000 limit.
SHARES ISSUABLE UNDER THE 1998 AWARD PROGRAM TO LI-PEI WU
Bancorp has entered into an Employment Agreement, dated as of January 1,
1998 and amended as of March 19, 1998, with Mr. Li-Pei Wu, the Chief Executive
Officer of Bancorp (the "Agreement"). The incentive compensation award program
contained in the Agreement was approved by the shareholders of Bancorp at the
1998 annual meeting held on May 7, 1998. For a description of the Agreement and
the incentive compensation award program contained therein, see "EXECUTIVE
COMPENSATION -- Employment Agreement" on pages 14-16.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE PROPOSAL TO
APPROVE THE GBC BANCORP 1999 EMPLOYEE STOCK INCENTIVE PLAN.
9
<PAGE> 11
EXECUTIVE COMPENSATION
The following table sets forth the cash and noncash compensation paid or
accrued by Bancorp or the Bank to or for the account of the Chief Executive
Officer and each of the other most highly compensated executive officers of
Bancorp and the Bank whose total annual salary and bonus for the last fiscal
year exceeds $100,000 (the "Named Executives") for the fiscal years ended
December 31, 1998, 1997, and 1996.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION(1)
---------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------------------- ----------------------- -------
OTHER RESTRICTED SECURITIES
ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARDS OPTIONS LTIP COMPENSATION
PRINCIPAL POSITION YEAR ($) (2)($) (3)($) ($) (4)(#) ($) (5)($)
------------------ ---- -------- ---------- ------------ ---------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Li-Pei Wu 1998 $402,336 $1,558,863 $306,611 N/A(6) -- N/A $27,400
Chairman of the Board, 1997 383,048 1,497,504 294,542 N/A -- N/A 20,000
Chief Executive Officer and 1996 364,224 1,010,620 198,778 N/A -- N/A 21,500
Director of Bancorp and Bank
Peter Wu 1998 156,000 174,468 34,316 N/A 20,000 N/A 27,084
President, 1997 112,025 200,000 39,338 N/A 8,000 N/A 16,534
Secretary, Chief Operating 1996 108,000 100,000 16,875 N/A 14,000 N/A 19,090
Officer, and Director of
Bancorp and Bank
Peter Lowe 1998 118,800 92,045 18,104 N/A 8,000 N/A 6,116
Executive Vice President and 1997 115,060 117,000 23,013 N/A 6,000 N/A 5,753
Chief Financial Officer of 1996 109,200 108,574 18,322 N/A 8,000 N/A 5,452
Bancorp and Bank
Eddie Chang 1998 84,000 99,585 16,805 N/A 6,000 N/A 4,188
Senior Vice President and 1997 75,450 102,588 17,312 N/A 4,000 N/A 3,773
Manager of Real Estate 1996 64,800 67,360 9,079 N/A 5,000 N/A 3,235
Lending Department of Bank
Domenic Massei 1998 87,000 92,487 18,191 N/A 7,000 N/A 4,339
Senior Vice President of 1997 81,400 90,000 15,188 N/A 3,000 N/A 4,070
Operations Administration of 1996 76,800 60,000 10,125 N/A 6,000 N/A 3,830
Bank
</TABLE>
- ---------------
(1) Bancorp has no plans for granting restricted stock awards, or stock
appreciation rights, or making LTIP (Long-term Incentive Plan) payouts.
(2) Amounts shown are profit sharing awards paid for services rendered during
the years indicated.
(3) Amounts shown represent gross-up payments to cover the federal income tax
for the portion (up to 30%) of the profit sharing award paid to the Named
Executive for services rendered during the year which such Executive elects
to set aside pursuant to savings incentives. Amounts shown assume each of
the Named Executives elects to set aside 30% of the profit sharing award
paid to him.
(4) Options reflect a 2-for-1 stock split to shareholders of record on April 30,
1998.
(5) Amounts shown include the matching funds contributed by the Bank pursuant to
the General Bank Profit Sharing 401(k) Plan and Director Fees received by
the Named Executives who are Directors.
(6) Pursuant to Li-Pei Wu's Employment Agreement with the Company, for 1998 Mr.
Wu was granted a vested, deferred contractual right to receive 23,800 shares
of Bancorp Common Stock, which shares will be granted to him on January 1,
2004 (together with an additional number of shares equal in value to the
dividends that would have been paid on such shares during the deferral
period). See "EXECUTIVE COMPENSATION -- Employment Agreement" on pages
14-16.
10
<PAGE> 12
OPTION GRANTS IN LAST FISCAL YEAR
The following table reflects information with regard to stock options
granted under the GBC Bancorp Amended and Restated 1988 Stock Option Plan to the
Named Executives during fiscal 1998, as indicated in the Summary Compensation
Table.
OPTION GRANTS IN LAST FISCAL YEAR
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(4)
<S> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
<CAPTION>
NO. OF SECURITIES
UNDERLYING % OF TOTAL OPTIONS EXERCISE OR
OPTIONS GRANTED TO EMPLOYEES BASE PRICE EXPIRATION 5% 10%
NAME GRANTED(1)(2) IN FISCAL YEAR ($/SHARE)(3) DATE ($) ($)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Li-Pei Wu 0 N/A N/A N/A 0 0
- ----------------------------------------------------------------------------------------------------------------------
Peter Wu 4,000 1.68% 27.125 1/14/2000 11,121 22,785
4,000 1.68% 27.125 1/14/2001 17,102 35,914
4,000 1.68% 27.125 1/14/2002 23,382 50,355
4,000 1.68% 27.125 1/14/2003 29,977 66,240
4,000 1.68% 27.125 1/14/2004 36,900 83,714
- ----------------------------------------------------------------------------------------------------------------------
Peter Lowe 1,600 0.67% 27.125 1/14/2000 4,449 9,114
1,600 0.67% 27.125 1/14/2001 6,841 14,365
1,600 0.67% 27.125 1/14/2002 9,353 20,142
1,600 0.67% 27.125 1/14/2003 11,991 26,496
1,600 0.67% 27.125 1/14/2004 14,760 33,486
- ----------------------------------------------------------------------------------------------------------------------
Eddie Chang 1,200 0.50% 27.125 1/14/2000 3,336 6,836
1,200 0.50% 27.125 1/14/2001 5,131 10,774
1,200 0.50% 27.125 1/14/2002 7,015 15,106
1,200 0.50% 27.125 1/14/2003 8,993 19,872
1,200 0.50% 27.125 1/14/2004 11,070 25,114
- ----------------------------------------------------------------------------------------------------------------------
Domenic Massei 1,400 0.59% 27.125 1/14/2000 3,892 7,975
1,400 0.59% 27.125 1/14/2001 5,986 12,570
1,400 0.59% 27.125 1/14/2002 8,184 17,624
1,400 0.59% 27.125 1/14/2003 10,492 23,184
1,400 0.59% 27.125 1/14/2004 12,915 29,300
</TABLE>
- --------------------------------------------------------------------------------
- ---------------
(1) Options granted in 1998 are exercisable starting 6 months after the grant
date, with 20% of the shares covered thereby becoming exercisable at that
time and with an additional 20% of the option shares becoming exercisable on
each successive anniversary date, with full vesting occurring on the fourth
anniversary date.
(2) Options have a term of 6 years, subject to earlier termination in the event
of the optionee's cessation of service with Bancorp. Each installment of
vesting shares (reported as separate grants in the above table) will
terminate on the second anniversary of the first date as of which such
installment becomes exercisable, except for the first installment which will
terminate one and one-half years after the date such installment becomes
exercisable. Options will become immediately exercisable in the event of a
liquidation, reorganization, merger or consolidation of Bancorp with another
corporation as a result of which Bancorp is not the surviving corporation,
or an asset sale of Bancorp to another person.
(3) The exercise price and tax withholding obligations related to exercise are
payable by the optionee at time of exercise.
(4) The difference between the exercise price as multiplied by the annual
appreciation rate shown compounded annually for the full term of the option
and exercise price, multiplied by the number of options granted. The dollar
amounts set forth under the heading are the result of calculations at the 5%
and 10% rates set by the SEC and therefore are not intended to forecast
possible future valuation, if any, of the stock price of Bancorp.
11
<PAGE> 13
OPTION EXERCISES IN LAST FISCAL YEAR AND VALUE OF UNEXERCISED OPTIONS AT YEAR
END
<TABLE>
<CAPTION>
VALUE OF
SECURITIES
NUMBER OF UNDERLYING
SECURITIES UNEXERCISED
UNDERLYING IN-THE-MONEY
UNEXERCISED OPTIONS AT
OPTIONS AT 12/31/98(1)(2)
SHARES ACQUIRED 12/31/98(2) EXERCISABLE/
ON EXERCISE VALUE REALIZED(1) EXERCISABLE/ UNEXERCISABLE
NAME (#) ($) UNEXERCISABLE ($)
---- --------------- ----------------- -------------- -----------------
<S> <C> <C> <C> <C>
Li-Pei Wu................ 65,000 2,815,800 476,000/0 9,120,160/0
Peter Wu................. -- -- 12,400/28,800 140,375/196,350
Peter Lowe............... 8,000 163,811 4,400/17,200 41,100/172,000
Eddie Chang.............. 1,500 53,319 3,600/9,200 36,988/61,725
Domenic Massei........... 2,200 92,850 4,800/10,600 56,875/76,850
</TABLE>
- ---------------
(1) Value is based on market value of Bancorp's Common Stock at date of exercise
or end of fiscal 1998 minus the exercise price.
(2) Bancorp has no plans pursuant to which stock appreciation rights may be
granted.
BOARD OF DIRECTORS' REPORT ON EXECUTIVE COMPENSATION
Compensation for each of the Named Executives, as well as other middle
level officers and above and certain business development employees, is
comprised mainly of a base salary and incentive compensation. The incentive
compensation may be made in awards of individual direct incentives, department
incentives, Company-wide profit sharing, and long-term compensation in the form
of stock options.
GBC Bancorp and General Bank (collectively the "Company") have maintained
the philosophy that compensation to officers should be highly incentive
oriented, and that employees should be encouraged to pursue better individual
and/or group performance and be rewarded accordingly. Consistent with this
compensation philosophy, the Company's existing profit sharing plan was amended
in February, 1996 and was expanded to create, in addition to the existing profit
sharing program, a new direct incentive program for officers and certain
non-officer employees whose business development or profit center financial
results can be quantified. Annual profit sharing and incentive awards are made
to the Company's officer-employees and eligible non-officer employees involved
in business development and marketing under the Company's profit sharing and
incentive compensation programs in accordance with the criteria discussed below.
The amount available for awards under the Company's profit sharing and
incentive compensation programs is based on the audited year end financial
statements, computed as follows: (i) 5.4% of any amount by which the Bank's tax
equivalent income before taxes exceeds 10% of the net equity of the Bank at the
beginning of that fiscal year but does not exceed 15% of such net equity; and
(ii) 6.4% of any amount by which such income exceeds 15% of such net equity. Of
the amount so determined to be available for the annual profit sharing and
incentive awards, specific incentive awards shall first be allocated to those
officers eligible to receive direct incentive compensation by virtue of their
quantifiable performance, and, only after such incentive awards are so
allocated, the Company-wide profit sharing awards shall then be allocated to
eligible officers of the Company from the remaining available funds. However,
since officers eligible to receive direct individual or group incentives are
rewarded based on quantifiable profitability improvements and achievements made
during a year, such incentive awards are not dependent upon the Company's
achieving the threshold of 10% return on shareholder's equity, but are based
upon the officer's individual and/or departmental profitability results.
Accordingly, awards may be made to such eligible officers for direct incentives
even if the threshold return described above is not met. The Company's
management shall report to the Board of Directors if and when such situation
arises.
The Company has established certain weighting guidelines in allocating the
Company-wide profit sharing awards. The weighting guidelines are based upon a
categorization of the Company's officers and business development personnel into
groups representing different job responsibilities. The exact weights assigned
to
12
<PAGE> 14
each of the groups will be reviewed annually by the Company's Chief Executive
Officer, and may be adjusted depending on the Chief Executive Officer's
assessment about each group's contribution to the Company's profits. The
allocation of the Company-wide profit sharing awards within each group will be
based on each individual's salary and job performance.
A further component of officer compensation is the awarding of stock
options. The Company believes that stock ownership by key employees provides a
valuable incentive for them as they will benefit as the Bancorp stock price
increases, and that stock-based performance compensation arrangements are also
conducive to aligning employees' and shareholders' interests.
Compensation for the Chief Executive Officer, Mr. Li-Pei Wu, was made in
accordance with his five year employment agreement with Bancorp and the Bank
with an effective date of January 1, 1998 (described on pages 14-16) pursuant to
the direction and approval of their respective Board of Directors. The formula
of the profit sharing award for the Chief Executive Officer was initially
approved by the Board in 1982 as a part of the compensation provided in his
prior employment agreement, which agreement was subsequently renewed three times
without any change in such profit sharing formula. Under Mr. Wu's new employment
agreement, the incentive compensation cash award payable to him in the fiscal
years 2000, 2001 and 2002 will be subject to maximum dollar limitations. See
"Employment Agreement" on page 14.
In setting the compensation to the Chief Executive Officer pursuant to the
aforesaid employment agreement effective as of January 1, 1998, the Board of
Directors took particular note of the management's success, under the direction
of the Chief Executive Officer, in achieving the financial goals and in
effectively directing the Company's operations. The Board of Directors believes
Mr. Wu has managed the Company extremely well in a challenging business climate
and has accomplished distinguished results in comparison to peer companies in
the banking industry.
The philosophy guiding the Board in its structuring of Mr. Wu's
compensation program under his new employment agreement was to place an emphasis
on the Common Stock of Bancorp as a component of incentive compensation with the
intention to motivate Mr. Wu to improve stock market performance. Furthermore,
in order to encourage Mr. Wu to take a long-term view towards the Company's
performance, and related thereto to take an active role in the selection and
training of his successor as Chief Executive Officer of the Company, the Board
felt it advisable to provide for the grant of new stock options to Mr. Wu in
2001 for his promise not to compete with the business of the Company for five
(5) years after termination of his employment, and also to require that shares
granted to him under the stock retention program of the new employment agreement
be received by him only after deferral periods of two (2) or five (5) years. In
setting Mr. Wu's compensation under his new employment agreement the Board took
into consideration the Company's exceptional performance under his management,
particularly when compared to other members of its peer group.
In connection with the compensation of the Named Executives, the Board has
considered the applicability of Section 162(m) of the Internal Revenue Code.
Section 162(m) limits deductibility of compensation in excess of $1,000,000.00
paid to a Named Executive unless this compensation qualifies as
"performance-based". During the course of negotiating Mr. Wu's compensation
under his new employment agreement (described on pages 14-16) with Bancorp and
the Bank, the Board considered the application of Section 162(m), and Mr. Wu's
compensation has been structured to minimize the possibility that the non-
performance-based compensation portion of his annual compensation will exceed
the $1,000,000.00 Section 162(m) limitation. The Board believes that the
incentive compensation cash award payable to Mr. Wu qualifies as
performance-based compensation and satisfies the requirements for exemption
under Section 162(m).
Mr. Wu's non-performance-based compensation for 1998 did not exceed the
Section 162(m) limitation, and the Board believes that the likelihood is low
that such Section 162(m) limitation will be exceeded for any year that Mr. Wu is
a Named Executive. However, to the extent that the non-performance-based
compensation payable to Mr. Wu under such employment agreement may exceed the
$1,000,000.00 limitation of Section 162(m) for any year that he is a Named
Executive, such excess amount will not be tax deductible by the Company.
13
<PAGE> 15
Other than Mr. Wu, there are no employees of the Company who received
compensation over $1,000,000.00 during 1998, and the Board does not believe that
the compensation payable to any of the Company's executive officers other than
Mr. Wu will approach the $1,000,000.00 limitation in the near future.
<TABLE>
<S> <C>
THE BOARD OF DIRECTORS:
Helen Chen Chien-Te Wu
Thomas C. T. Chiu Julian Wu
Chuang-I Lin Li-Pei Wu
Ko-Yen Lin Peter Wu
Ting Y. Liu Ping C. Wu
John Wang Walter Wu
Kenneth Wang Chin-Liang Yen
</TABLE>
EMPLOYMENT AGREEMENT
On February 19, 1998 Mr. Li-Pei Wu, Bancorp and the Bank entered into an
employment agreement having an effective date of January 1, 1998, which
agreement was modified by an amendment entered into on March 19, 1998 with an
effective date of January 1, 1998 (as so amended, the "Employment Agreement").
The incentive compensation award program provided for in the Employment
Agreement was approved by the holders of a majority of the outstanding shares of
the Company at the Company's Annual Meeting of Shareholders held in 1998.
The Employment Agreement provides for an employment term of five (5) years,
commencing January 1, 1998, and ending December 31, 2002. Pursuant to the
Employment Agreement, Mr. Wu will serve as Chairman of the Board of Bancorp and
the Bank throughout the entire term of the Employment Agreement, and will serve
as Chief Executive Officer of Bancorp and the Bank only through December 31,
2000.
The Employment Agreement provides for a base annual salary of $402,336.00,
which amount was adjusted on January 1, 1999, and will be further adjusted on
each anniversary thereof, by a percentage increase equal to three percent (3%)
over the increase in the Consumer Price Index.
The Employment Agreement also provides for an annual incentive compensation
award payable to Mr. Wu, which award is based upon a formula identical to that
for the annual profit sharing award included in Mr. Wu's prior employment
agreement, to be computed as follows: (i) three percent (3%) of any amount by
which the Bank's tax equivalent income before taxes exceeds ten percent (10%) of
the net equity of the Bank at the beginning of that fiscal year but does not
exceed fifteen percent (15%) of such net equity; and (ii) four percent (4%) of
any amount by which such income exceeds fifteen percent (15%) of such net
equity. In addition, Mr. Wu will be entitled to receive from each Bancorp
subsidiary (other than the Bank), if any exists, an incentive compensation cash
award computed in accordance with a formula identical to the one described in
the preceding sentence. The aggregate incentive compensation cash award payable
to Mr. Wu shall be subject to the following maximum dollar limitations
commencing with the fiscal year ending December 31, 2000: (i) $1,500,000.00 for
the fiscal year 2000; (ii) $400,000.00 for the fiscal year 2001; and (iii)
$400,000.00 for the fiscal year 2002. Amounts of incentive compensation cash
awards received by Mr. Wu with respect to services rendered in 1998, 1997, 1996
are included in the Summary Compensation Table on page 10.
Pursuant to grants of non-qualified options under the GBC Bancorp Amended
and Restated 1988 Stock Option Plan made to Mr. Wu in accordance with his prior
employment agreement, which options have all become exercisable and have been
exercised in part, Mr. Wu now holds unexercised options to acquire 476,000
shares of Common Stock at a price of $6.59 per share. Such options will expire
on December 19, 2001 or, notwithstanding such expiration date, three (3) months
after the termination of Mr. Wu's employment with the Company, provided that (i)
in the case of his death during such three (3)-month period or while still
employed, such options would expire one (1) year after his death or (ii) in the
case of termination by reason of disability, within one (1) year after such
termination.
14
<PAGE> 16
Under the Employment Agreement, subject to the approval of the GBC Bancorp
1999 Employee Stock Incentive Plan by the shareholders of the Company at the
Meeting (see "APPROVAL OF THE GBC BANCORP 1999 EMPLOYEE STOCK INCENTIVE PLAN" on
pages 5-9) and provided that Mr. Wu continues in the employ of the Company
through December 19, 2001, on such date Mr. Wu will be granted a non-qualified
stock option to purchase shares of Bancorp Common Stock equal to the aggregate
of the number of shares of Bancorp Common Stock that are covered by the
unexercised portion of Mr. Wu's December 19, 1991 non-qualified stock option as
of December 31, 2000 and/or the number of shares that had been previously
acquired by Mr. Wu by reason of exercising such non-qualified stock option and
which shares are held by him as of December 31, 2000. The number of shares of
Bancorp Common Stock subject to the new non-qualified stock option will be
equitably adjusted in the event of any change to Bancorp Common Stock occurring
as a result of any stock split, stock dividend, reorganization or similar
transaction. The exercise price under such new option will be the fair market
value of Bancorp Common Stock on the date of grant and such option will vest
immediately. The new option will be exercisable until December 31, 2007;
provided, that if Mr. Wu's employment with the Company terminates prior to
December 31, 2002, the exercise period will only be three (3) months from such
termination date, or, if Mr. Wu dies or becomes disabled, the exercise period
will be the earlier of one (1) year from his death or disability or December 31,
2007.
The Employment Agreement provides that commencing with the fiscal year
ending December 31, 1999 Mr. Wu may elect in his discretion to receive up to
one-half ( 1/2) of his incentive compensation cash award for any fiscal year in
shares of Bancorp Common Stock. If Mr. Wu makes such an election he will receive
as of the date of such election Bancorp Common Stock equal in value (determined
as of such election date) to the portion of the cash award for which he elected
to receive Bancorp Common Stock. In addition, he will be awarded as of such
election date a vested, deferred contractual right to receive two (2) years
later Bancorp Common Stock equal in value to the sum of fifty percent (50%) in
value of the portion of the cash award for which he elected to receive Bancorp
Common Stock plus the value of dividends that would have been paid during the
two (2)-year deferral period had such Bancorp Common Stock actually been granted
to him on the date of his election. The number of shares of Bancorp Common Stock
subject to the vested, deferred contractual right will be equitably adjusted in
the event of any change to Bancorp Common Stock occurring as a result of any
stock split, stock dividend, reorganization or similar transaction.
The Employment Agreement further provides that during the first three (3)
years of Mr. Wu's employment thereunder Bancorp shall grant to him a vested,
deferred contractual right to receive one share of Bancorp Common Stock for
every twenty (20) shares of Bancorp Common Stock acquired by him through
exercise of his non-qualified stock option, or acquired by reason of his
election to receive up to one-half ( 1/2) of his incentive compensation cash
award for any fiscal year in Bancorp Common Stock, excluding shares for which
Mr. Wu has a vested, deferred contractual right to receive, and/or of vested
option shares (even though not exercised) under his non-qualified stock option
that are held during the full term of the relevant fiscal year. Pursuant to such
provision of the Employment Agreement, for 1998 Mr. Wu was granted a vested,
deferred contractual right to receive 23,800 shares of Bancorp Common Stock. The
total number of shares to be received by Mr. Wu shall not in the aggregate
exceed 100,000, which number is subject to equitable adjustment in the event of
any change to Bancorp Common Stock occurring as a result of any stock split,
stock dividend, reorganization or similar transaction. Such additional shares
shall be granted on the fifth (5th) anniversary of the first (1st) day of
January following the year with respect to which the contractual right to
receive the additional shares was awarded (together with a further number of
shares equal in value to the dividends that would have been paid on the
additional shares during such five (5)-year deferral period).
In the event of the disability of Mr. Wu, either he or the Company may
elect to terminate his employment upon six (6) months prior written notice,
during which period he is entitled to his regular pay and a proportionate part
of any incentive compensation award.
The Employment Agreement gives Mr. Wu a right to at any time, with or
without cause, to terminate the Employment Agreement upon six (6) months prior
written notice to the Company, during which period he is entitled to his regular
pay and a proportionate part of any incentive compensation award.
15
<PAGE> 17
Under the Employment Agreement, at the expiration of its stated term on
December 31, 2002 (other than for cause), Mr. Wu will be entitled to an annual
retirement benefit equal to fifty percent (50%) of the annual base salary he
earned during his final year of employment. This retirement benefit will be
payable in equal monthly installments over the five (5) years following the
expiration of the term of the Employment Agreement.
The Employment Agreement contains a noncompetition provision whereby Mr. Wu
agrees not to compete with the Company for a period of five (5) years following
the date of his termination of employment under the Employment Agreement. In the
event that Mr. Wu fails to comply with such noncompetition provision, as of the
date of such failure to comply, (i) the new stock option granted to Mr. Wu on
December 19, 2001, to the extent not yet exercised, or Mr. Wu's right to receive
such option if not yet granted, will expire or terminate, (ii) Mr. Wu will no
longer be entitled to the retirement benefit provided for under the Employment
Agreement, to the extent not yet paid, and (iii) Mr. Wu will no longer be
allowed continued use of an office and automobile.
In the event of any merger or consolidation or acquisition of Bancorp or
the Bank, whereby Bancorp or the Bank is not the surviving entity, or another
entity or person acquires more than fifty percent (50%) of the outstanding
Common Stock of the Bank or Bancorp in one or more transactions, or the Bank or
Bancorp ceases to exist pursuant to any of such transactions or similar
transactions (any of which herein referred to as a "Triggering Event"), under
the contingency stock option granted pursuant to his prior employment agreement
with the Company, provided Mr. Wu is then in the employ of the Company, Mr. Wu
shall have the right to purchase 242,000 shares of Bancorp Common Stock at $1.86
per share, exercisable upon the execution of an agreement or the application to
any regulatory authority for approval of or consent to any Triggering Event,
such right to remain exercisable in whole or in part until 45 days after the
consummation of the Triggering Event. If any Triggering Event is not
consummated, such contingent option shall then not be exercisable, but shall
continue in full force and effect and be exercisable upon the occurrence of any
future Triggering Event.
CHANGE IN CONTROL ARRANGEMENTS
Bancorp has certain compensatory arrangements with its executive officers
which will result from a change in control of the Company. All stock option
agreements outstanding under the GBC Bancorp Amended and Restated 1988 Stock
Option Plan provide for the acceleration of exercisability of options upon the
occurrence of certain triggering events, including a liquidation,
reorganization, merger or consolidation of Bancorp with another corporation as a
result of which Bancorp is not the surviving or resulting corporation, or a sale
of substantially all the assets of Bancorp to another person, or a reverse
merger in which Bancorp is the surviving corporation but the shares of Bancorp's
stock outstanding immediately preceding the merger are converted by virtue of
the merger into other property.
The GBC Bancorp 1999 Employee Stock Incentive Plan proposed for shareholder
approval at the Meeting also includes certain change in control provisions. See
"APPROVAL OF THE GBC BANCORP 1999 EMPLOYEE STOCK INCENTIVE PLAN" on pages 5-9.
In addition, pursuant to the authorization of the Board of Directors of
Bancorp, certain employees of the Bank were granted contingency stock options to
purchase Common Stock of Bancorp upon the occurrence of a triggering event. The
term triggering event for this purpose shall mean the execution of an agreement
providing for any of the following transactions or the application to any
regulatory authority for approval of or consent to any of the following
transactions: sale of substantially all of the assets of the Bank or Bancorp,
any merger or consolidation or acquisition of the Bank or Bancorp whereby the
Bank or Bancorp is not the surviving entity, or an entity or person or such
person and his associates acquires up to fifty percent (50%) of the outstanding
Common Stock of the Bank or Bancorp in one transaction or in a series of related
transactions, or the Bank or Bancorp ceases to exist pursuant to any such
transactions or similar transactions. The contingency stock option may be
exercised in whole or in part by the employee at any time after the occurrence
of the triggering event and until 45 days after the date the triggering event is
consummated. In the event an employee's employment by the Bank is terminated,
the contingency stock option previously granted to him is also terminated.
16
<PAGE> 18
DISCLOSURE OF LATE FILINGS OF SECTION 16(A) REPORTS
Section 16(a) of the Exchange Act requires Bancorp's directors and
executive officers, and persons who own more than 10% of a registered class of
Bancorp's equity security (if any), to file with the SEC reports of ownership
and changes in ownership of common stock of Bancorp. Officers, directors and
greater than 10% shareholders are required by SEC regulation to furnish the
issuer with copies of all Section 16(a) forms they file.
Based solely on review of the copies of such reports furnished to Bancorp
or representations that no other reports were required, Bancorp believes that,
during the 1998 fiscal year, all filing requirements applicable to Bancorp's
officers and directors were complied with, except that Chuang-I Lin, Director,
failed to timely file a Form 4 Report on a single transaction.
COMPARATIVE STOCK PERFORMANCE
Set forth below is a line graph comparing the cumulative total shareholder
return on the Common Stock of Bancorp for the last five fiscal years with the
cumulative total return on the S&P 500 Index and the SNL Securities, L.P.
California Independent Bank Stock Index over the same period.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
ON GBC BANCORP COMMON STOCK, S&P 500 INDEX & SNL SECURITIES, L.P.
CALIFORNIA INDEPENDENT BANK STOCK INDEX
TOTAL RETURN PERFORMANCE
<TABLE>
<CAPTION>
CALIFORNIA INDEPENDENT
GBC BANCORP S&P 500 BANKS
----------- ------- ----------------------
<S> <C> <C> <C>
12/31/93 100.00 100.00 100.00
12/31/94 94.21 101.32 106.07
12/31/95 118.43 139.39 146.57
12/31/96 190.53 171.26 180.90
12/31/97 442.57 228.42 354.40
12/31/98 361.68 293.69 334.34
</TABLE>
ASSUMES $100 INVESTED ON DECEMBER 31, 1993 IN GBC BANCORP COMMON STOCK, S&P 500
INDEX, AND SNL SECURITIES, L.P. CALIFORNIA INDEPENDENT BANK STOCK INDEX
* TOTAL RETURN ASSUMES REINVESTMENT OF DIVIDENDS
17
<PAGE> 19
SELECTION OF AUDITORS
The Board of Directors of Bancorp has engaged the firm of Deloitte & Touche
LLP as independent auditors of Bancorp, effective October 22, 1998. On such date
the firm of KPMG Peat Marwick LLP was terminated as Bancorp's independent
auditors, and the termination was approved by the Board of Directors of Bancorp.
Reports of the former independent auditors on Bancorp's financial
statements did not contain any adverse opinion or disclaimer of opinion or were
qualified as to an uncertainty, nor were there any disagreements between Bancorp
and the former auditors on any matter of accounting principles or practices,
financial statement disclosures, or auditing scope or procedure which, if not
resolved to the satisfaction of the former auditors, would have caused them to
make a reference to the subject matter of the disagreement in their report.
There were also no "reportable events" occurring within Bancorp's two most
recent fiscal years.
Representatives of Deloitte & Touche LLP are expected to be present at the
Meeting. They will have an opportunity to make a statement if they desire to do
so and will be available to respond to appropriate questions.
CERTAIN TRANSACTIONS
Some of the directors and executive officers of Bancorp and the companies
with which they are associated are customers and have had banking transactions
with the Bank in the ordinary course of the Bank's business, and the Bank
expects to have banking transactions with such persons in the future. In
management's opinion, all loans and commitments to lend included in such
transactions were made on substantially the same terms, including interest rates
and collateral, as those prevailing for comparable transactions with other
persons of similar creditworthiness and, in the opinion of management, did not
involve more than a normal risk of collectibility or present other unfavorable
features. The aggregate balance outstanding at December 31, 1998, of all such
loans and credit extensions to all directors and executive officers of the Bank,
together with their associates, was $1,888,293, constituting approximately 1.19%
of the Bank's Stockholders' Equity.
SHAREHOLDERS' PROPOSALS
Any shareholder of Bancorp who wishes to present a proposal to be
considered at the next Annual Meeting of Shareholders of Bancorp and who wishes
to have such proposal presented in Bancorp's Proxy Statement for such Meeting
must deliver such proposal in writing to Bancorp at its head office stated above
not later than December 31, 1999.
18
<PAGE> 20
OTHER MATTERS
The Board of Directors has no knowledge of any other matters which may come
before the Meeting and does not intend to present any other matters. However, if
any other matters shall properly come before the Meeting or any adjournment
thereof, the persons named as proxies will have discretionary authority to vote
the shares represented by the accompanying proxy in accordance with their best
judgment.
GBC BANCORP
/s/ PETER WU
--------------------
Peter Wu
Secretary
Dated: March 22, 1999
A COPY OF BANCORP'S 1998 ANNUAL REPORT TO THE SECURITIES AND EXCHANGE
COMMISSION ON FORM 10-K WILL BE PROVIDED TO SHAREHOLDERS WITHOUT CHARGE UPON
WRITTEN REQUEST TO GBC BANCORP, 800 WEST SIXTH STREET, LOS ANGELES, CALIFORNIA
90017. ATTENTION: INVESTOR RELATIONS.
19
<PAGE> 21
APPENDIX A
GBC BANCORP
1999 EMPLOYEE STOCK INCENTIVE PLAN
SECTION 1. Purpose of Plan
The purpose of this 1999 Employee Stock Incentive Plan ("Plan") of GBC
Bancorp, a California corporation (the "Company"), is to enable the Company and
its subsidiaries to attract, retain and motivate their employees, nonemployee
directors and consultants by providing for or increasing the proprietary
interests of such employees, nonemployee directors and consultants in the
Company and, thereby, further align their interests with those of the
shareholders of the Company.
SECTION 2. Persons Eligible Under Plan
Each of the following persons (each, a "Participant") shall be eligible to
be considered for the grant of Awards (as hereinafter defined) hereunder: (1)
any employee of the Company or any of its subsidiaries or any other entity in
which the Company has a significant equity or other interest as determined by
the Committee, including any director who is also such an employee, (2) any
director of the Company or any of its subsidiaries who is not also an employee
of the Company or any of its subsidiaries (a "Nonemployee Director") and (3) any
consultant of the Company or any of its subsidiaries.
SECTION 3. Awards
(a) The Committee (as hereinafter defined), on behalf of the Company, is
authorized under this Plan to enter into any type of arrangement with a
Participant that is not inconsistent with the provisions of this Plan
and that, by its terms, involves or might involve the issuance of (i)
shares of common stock of the Company ("Common Shares") or (ii) a
Derivative Security (as such term is defined in Rule 16a-1 promulgated
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), as such rule may be amended from time to time) with an exercise
or conversion privilege at a price related to the Common Shares or with
a value derived from the value of the Common Shares. The entering into
of any such arrangement is referred to herein as the "grant" of an
"Award."
(b) Awards are not restricted to any specified form or structure and may
include, without limitation, sales or bonuses of stock, restricted
stock, stock options, reload stock options, stock purchase warrants,
other rights to acquire stock, securities convertible into or
redeemable for stock, stock appreciation rights, phantom stock,
dividend equivalents, performance units or performance shares, and an
Award may consist of one such security or benefit, or two or more of
them in tandem or in the alternative.
(c) Awards may be issued, and Common Shares may be issued pursuant to an
Award, for any lawful consideration as determined by the Committee,
including, without limitation, services rendered by the recipient of
such Award.
(d) Subject to the provisions of this Plan, the Committee, in its sole and
absolute discretion, shall determine all of the terms and conditions of
each Award granted under this Plan, which terms and conditions may
include, among other things:
(i) a provision permitting the recipient of such Award, including any
recipient who is a director or officer of the Company, to pay the
purchase price of the Common Shares or other property issuable
pursuant to such Award, or such recipient's tax withholding
obligation with respect to such issuance, in whole or in part, by
any one or more of the following:
(A) the delivery of cash;
(B) the delivery of other property deemed acceptable by the
Committee;
A-1
<PAGE> 22
(C) the delivery of previously owned shares of capital stock of the
Company (including "pyramiding") or other property;
(D) a reduction in the amount of Common Shares or other property
otherwise issuable pursuant to such Award;
(E) authorizing a third party to sell Common Shares or other
property otherwise issuable pursuant to such Award and to remit
to the Company a sufficient portion of the sale proceeds to pay
for all the Common Shares acquired through such exercise or any
tax withholding obligation resulting from such exercise; or
(F) crediting toward the purchase price a portion of the recipient's
deferred compensation account balance;
(ii) a provision conditioning or accelerating the receipt of benefits
pursuant to such Award, either automatically or in the discretion
of the Committee, upon the occurrence of specified events,
including, without limitation, a change of control of the Company
(as defined by the Committee), an acquisition of a specified
percentage of the voting power of the Company, the dissolution or
liquidation of the Company, a sale of substantially all of the
property and assets of the Company or an event of the type
described in Section 7 hereof; or
(iii) a provision required in order for such Award to qualify as an
incentive stock option under Section 422 of the Internal Revenue
Code (an "Incentive Stock Option"); provided, however, that no
Award issued to any consultant or any Nonemployee Director may
qualify as an Incentive Stock Option.
(e) All certificates evidencing Awards or Common Shares issued pursuant
thereto shall bear any legend determined by the Committee (as defined
below) to be necessary or appropriate.
SECTION 4. Stock Subject to Plan
(a) Subject to adjustment as provided in Section 7, at any time, the
aggregate number of Common Shares issued and issuable pursuant to all
Awards granted under this Plan shall not exceed the sum of (i)
1,000,000, including any Common Shares issuable pursuant to that
certain Employment Agreement dated as of January 1, 1998, between the
Company and Li-Pei Wu, as the same may be amended from time to time,
(ii) any Common Shares available for future awards under any prior plan
of the Company as of the effective date of the Plan and (iii) any
Common Shares subject to awards granted under any prior plan of the
Company which are forfeited, expire or are canceled without delivery of
Common Shares.
(b) For purposes of Section 4(a) hereof, the aggregate number of Common
Shares issued and issuable pursuant to Awards granted under this Plan
shall at any time be deemed to be equal to the sum of the following:
(i) the number of Common Shares that were issued prior to such time
pursuant to Awards granted under this Plan, other than Common
Shares that were subsequently reacquired by the Company pursuant to
the terms and conditions of such Awards and with respect to which
the holder thereof received no benefits of ownership such as
dividends; plus
(ii) the number of Common Shares that were otherwise issuable prior to
such time pursuant to Awards granted under this Plan, but that
were withheld by the Company as payment of the purchase price of
the Common Shares issued pursuant to such Awards or as payment of
the recipient's tax withholding obligation with respect to such
issuance; plus
(iii) the maximum number of Common Shares that are or may be issuable at
or after such time pursuant to Awards granted under this Plan
prior to such time.
A-2
<PAGE> 23
SECTION 5. Duration of Plan
No Awards shall be made under this Plan after April 22, 2009. Although
Common Shares may be issued after April 22, 2009 pursuant to Awards made prior
to such date, no Common Shares shall be issued under this Plan after April 22,
2019.
SECTION 6. Administration of Plan
(a) This Plan shall be administered by the Board of Directors of the
Company (the "Board") or, at the election of the Board, by a committee
of the Board consisting of two or more directors, each of whom is an
"outside director" within the meaning of Section 162(m) of the Internal
Revenue Code of 1986, as amended, and who otherwise comply with the
requirements of Rule 16b-3 promulgated under the Exchange Act. The term
"Committee" shall mean the Board or any such committee of the Board
which shall have been designated by the Board to administer this Plan.
(b) Subject to the provisions of this Plan, the Committee shall be
authorized and empowered to do all things necessary or desirable in
connection with the administration of this Plan, including, without
limitation, the following:
(i) adopt, amend and rescind rules and regulations relating to this
Plan;
(ii) determine which persons are Participants and to which of such
Participants, if any, Awards shall be granted hereunder;
(iii) grant Awards to Participants and determine the terms and
conditions thereof, including the number of Common Shares
issuable pursuant thereto, any performance or vesting
contingencies and the terms of any transferability of such
Awards;
(iv) determine whether, and the extent to which adjustments are
required pursuant to Section 7 hereof;
(v) interpret and construe this Plan and the terms and conditions of
any Award granted hereunder; and
(vi) certify in writing prior to payment of compensation that the
performance goals and any other material terms of an Award were
in fact satisfied. For this purpose, approved minutes of the
Committee meeting in which the certification is made are treated
as a written certification.
SECTION 7. Adjustments
If the outstanding securities of the class then subject to this Plan are
increased, decreased or exchanged for or converted into cash, property or a
different number or kind of securities, or if cash, property or securities are
distributed in respect of such outstanding securities, in either case as a
result of a reorganization, merger, consolidation, recapitalization,
restructuring, reclassification, dividend (other than a regular cash dividend)
or other distribution, stock split, reverse stock split or the like, or if
substantially all of the property and assets of the Company are sold, then,
unless the terms of such transaction shall do so, the Committee shall make
appropriate and proportionate adjustments in (i) the number and type of shares
or other securities or cash or other property that may be acquired pursuant to
Awards theretofore granted under this Plan and (ii) the maximum number and type
of shares or other securities that may be issued pursuant to Awards thereafter
granted under this Plan.
SECTION 8. Amendment, Suspension and Termination of Plan
The Board may amend, suspend or terminate this Plan at any time and in any
manner, provided that no such amendment, suspension or termination shall impair,
or deprive the recipient of, any Award theretofore granted under this Plan,
without the consent of such recipient, of any of his or her rights thereunder or
with respect thereto.
A-3
<PAGE> 24
SECTION 9. Effective Date of Plan
This Plan shall be effective as of April 22, 1999, the date upon which it
was approved by the affirmative votes of the holders of a majority of the
securities of the Company present, or represented, and entitled to vote at a
meeting duly held in accordance with the laws of the State of California.
SECTION 10. Governing Law
This Plan and any Award granted hereunder shall be governed by and
construed and enforced in accordance with the laws of the State of California
without reference to choice or conflict of law principles.
A-4
<PAGE> 25
GBC BANCORP
ANNUAL MEETING OF SHAREHOLDERS, APRIL 22, 1999
The undersigned hereby appoints Sheila Miller and Peter Wu, or either of
them proxies, each with full power to appoint his substitute, and hereby
authorizes them to represent and to vote, as designated on the reverse, all the
shares of common stock of GBC Bancorp held on record by the undersigned on
February 28, 1999, at the Annual Meeting of Shareholders to be held on April
22, 1999 or any adjournments thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
(Please mark, sign, date and return the proxy card promptly using the enclosed
envelope.)
(To be signed on the other side.)
--------------
SEE
REVERSE SIDE
--------------
<PAGE> 26
Please mark your
A [X] votes as in this
example.
FOR all nominees WITHHOLD AUTHORITY
listed at right (except to vote for all
as marked to the nominees
contrary below) listed at right
1. ELECTION OF [ ] [ ]
DIRECTORS
INSTRUCTIONS: To withhold authority to NOMINEES: Helen Y. Chen
vote for any individual nominee, write Thomas C.T. Chu
that name on the space provided below. Chuang-I Lin
Ko-Yen Lin
_______________________________________ Ting Y. Liu
John C. Wang
Kenneth C. Wang
Chien-Te Wu
Julian Wu
Li-Pei Wu
Peter Wu
Ping C. Wu
Walter Wu
Chin-Liang Yen
2. Approval of the GBC Bancorp 1999 FOR AGAINST ABSTAIN
Employee Stock Incentive Plan. [ ] [ ] [ ]
3. OTHER BUSINESS: In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR ITEMS (1) AND (2). IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING,
THIS PROXY CONFERS AUTHORITY TO AND SHALL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS.
PLEASE DATE THIS PROXY AND SIGN AS THE NAME APPEARS BELOW.
YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND MAIL THIS PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
Signature(s)______________________________________________ Date __________, 1999
NOTE: When shares are held by joint tenants, both should sign. When signing as
attorney, as executor, administrator, trustee or guardian, please give full
title as such. If a corporation, please sign in full corporate name by
President or other authorized officer. If a partnership, please sign in
partnership name by authorized person.
