<PAGE> 1
As filed with the Securities And Exchange Commission on February 12, 1999
- -------------------------------------------------------------------------------
Registration No. 333- 63797
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POST EFFECTIVE AMENDMENT NO. 2
ON FORM S-8
TO
FORM S-4
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
FIRSTMERIT CORPORATION
(Exact name of registrant as specified in its charter)
OHIO 34-1339938
(State of incorporation) (I.R.S. Employer Identification No.)
III CASCADE PLAZA, AKRON OHIO 44308
(Address of Principal Executive Offices) (Zip Code)
SIGNAL AMENDED AND RESTATED STOCK OPTION AND INCENTIVE PLAN;
SIGNAL NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN;
SIGNAL 1997 OMNIBUS INCENTIVE PLAN;
FIRSTSHENANGO BANCORP, INC. 1993 STOCK OPTION PLAN; AND
SUMMIT BANCORP 1989 STOCK INCENTIVE PLAN
(Full Title of the Plans)
TERRY E. PATTON,
SENIOR VICE PRESIDENT AND SECRETARY, FIRSTMERIT CORPORATION
III CASCADE PLAZA, AKRON, OHIO 44308
(330) 996-6300
(Name, address, including zip code, and telephone number, including
area code of agent for service)
COPY TO:
KEVIN C. O'NEIL
BROUSE MCDOWELL, L.P.A.
500 FIRST NATIONAL TOWER
AKRON, OHIO 44308
(330) 434-5207
Calculation of Registration Fee
<TABLE>
<CAPTION>
========================================================================================================================
Title of securities to Amount to be Proposed maximum Proposed maximum Amount of
be registered registered offering price per aggregate offering registration fee
share price
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 930,752 Shares (2) N/A N/A (2) N/A (3)
no par value (1)
========================================================================================================================
</TABLE>
(1) Includes associated rights under the FirstMerit Shareholder Rights
Agreement (the "Rights"). Until the occurrence of certain prescribed events, the
Rights are not exercisable, are evidenced by the certificates representing the
FirstMerit Corporation common stock, without par value ("FirstMerit Common
Stock"), and trade with the FirstMerit Common Stock.
(2) This Post Effective Amendment No. 2 on Form S-8 to Form S-4 covers 930,752
shares of Common Stock originally registered on the Registration Statement on
Form S-4 to which this Amendment relates. These 930,752 shares of Common Stock
are issuable pursuant to options granted under (i) the Signal Amended and
Restated Stock Option and Incentive Plan; (ii) the Signal Non-Employee Director
Stock Option Plan; (iii) the Signal 1997 Omnibus Incentive Plan; (iv) the
FirstShenango Bancorp, Inc. 1993 Stock Option Plan; and (v) the Summit Bancorp
1989 Stock Incentive Plan (collectively, the "Plans"). See "Purpose of
Amendment."
(3) The Registrant previously paid $89,131 upon the initial filing of this
Registration Statement to register 17,047,000 shares of Common Stock issuable to
the Stockholders of Signal Corp, including the 930,752 shares of Common Stock
which may be issued pursuant to the Plans.
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<PAGE> 2
PURPOSE OF AMENDMENT
The purpose of this Post Effective Amendment No. 2 is to
register on Form S-8 930,752 shares of common stock, no par value per share
(the"Common Stock"), of FirstMerit Corporation (the "Company") previously
registered on Form S-4 (Registration No. 333-63797) for issuance pursuant to
options granted under (i) the Signal Amended and Restated Stock Option and
Incentive Plan; (ii) the Signal Non-Employee Director Stock Option Plan; (iii)
the Signal 1997 Omnibus Incentive Plan; (iv) the FirstShenango Bancorp, Inc.
1993 Stock Option Plan; and (v) the Summit Bancorp 1989 Stock Incentive Plan
(collectively, the "Plans") of Signal Corp ("Signal"), pursuant to the terms and
conditions of an Agreement of Affiliation and Plan of Merger dated as of August
10, 1998, between the Registrant and Signal, which provided for the merger of
Signal with and into the Registrant. The merger was consummated on February 12,
1999.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information required in Part I of the
Registration Statement will be provided to each participant in the Plans as
required by Rule 428(b)(1). Such documents are not being filed with the
Securities and Exchange Commission (the "Commission") in accordance with the
instructions to Form S-8, but constitute (along with the documents incorporated
by reference into the Registration Statement pursuant to Item 3 of Part II
hereof) a prospectus that meets the requirements of Section 10(a) of the
Securities Act of 1933.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Commission under the Exchange
Act by the Company (File No. 0-10161) are hereby incorporated by reference into
this Registration Statement Amendment:
a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1997 filed with the Commission on February 24,
1998, as amended by Form 10-K/A filed with the Commission on
April 30, 1998;
b) The portions of the Company's Proxy Statement for the Annual
Meeting of Shareholders held April 8, 1998 that have been
incorporated by reference in the Company's Annual Report on
Form 10-K for the year ended December 31, 1997;
c) The Company's Quarterly Reports on Form 10-Q for the period
ended March 31, 1998 filed with the Commission on May 14,
1998; for the period ended June 30,
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<PAGE> 3
1998 filed with the Commission on August 14, 1998, as amended
by Form 10-Q/A filed with the Commission on August 26, 1998;
and for the period ended September 30, 1998 filed with the
Commission on November 13, 1998;
d) The Company's Current Reports on Form 8-K filed with the
Commission on April 9, 1998, May 22, 1998, June 22, 1998,
August 31, 1998 and September 10, 1998; and
e) (i) The description of the Company's Common Stock contained in
the Company's Current Report on Form 8-K filed with the
Commission on September 10, 1998, and (ii) the description of
the rights issued pursuant to the FirstMerit Shareholders
Rights Agreement, dated as of October 23, 1993, by and between
the Company and FirstMerit Bank, N.A., as rights agent, as
amended and restated May 20, 1998, contained in Amendment No.
2 to the Company's Registration Statement on Form 8-A with
respect thereto filed with the Commission on June 22, 1998;
and any further amendment or report filed for the purpose of
updating the description.
All documents hereafter filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment that indicates that all securities offered have been
sold or that deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be part
hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The validity of the shares of the Company's Common Stock to be issued
by the Company under the Plans has been passed upon for the Company by its
counsel, Brouse McDowell, a Legal Professional Association ("Brouse McDowell").
Philip A. Lloyd II, a director and shareholder of the Company, is a shareholder
of Brouse McDowell. Kevin C. O'Neil is a shareholder of Brouse McDowell, and
the Company.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Pursuant to Article Sixth of the Amended and Restated Articles
of Incorporation of the Company, the Company may indemnify any director or
officer, any former director or officer of the Company and any person who is or
has served at the request of the Company as a director, officer or trustee of
another corporation, partnership, joint venture, trust or other enterprise (and
his heirs, executors and administrators) against expenses, including attorneys'
fees, judgments, fines and amounts paid in settlement, actually and reasonably
incurred by him by reason of the fact that he is or was such director, officer
or trustee in connection with any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative, to the
full extent permitted by applicable law, as the same may be in effect from time
to time. The indemnification
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provided for therein is not deemed to restrict the right of the Company to (i)
indemnify employees, agents and others as permitted by such law, (ii) purchase
and maintain insurance or provide similar protection on behalf of directors,
officers or such other persons against liabilities asserted against them or
expenses incurred by them arising out of their service to the Company, and (iii)
enter into agreements with such directors, officers, employees, agents or others
indemnifying them against any and all liabilities (or such lesser
indemnification as may be provided in such agreements) asserted against them or
incurred by them arising out of their service to the Company.
The rights provided in Article Sixth are in addition to any rights
provided by contract or as a matter of law. Ohio Revised Code Section 1701.13(E)
includes indemnification provisions similar to Article Sixth. Section 1701.13(E)
of the Ohio Revised Code provides that a corporation may indemnify or agree to
indemnify any person who was or is a party, or is threatened to be made a party,
to any threatened, pending, or completed action, suit, or proceeding, whether
civil, criminal, administrative, or investigative, other than an action by or in
the right of the corporation, by reason of the fact that he is or was a
director, officer, employee, or agent of the corporation, or is or was serving
at the request of the corporation as a director, trustee, officer, employee,
member, manager, or agent of another corporation, domestic or foreign, nonprofit
or for profit, a limited liability company, or a partnership, joint venture,
trust, or other enterprise, against expenses, including attorney's fees,
judgments, fines, and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit, or proceeding, if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, if he had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit, or proceeding by judgment, order,
settlement, or conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, that he had reasonable cause to believe that his conduct was
unlawful.
Section 1701.13(E)(2) further specifies that a corporation may
indemnify or agree to indemnify any person who was or is a party, or is
threatened to be made a party, to any threatened, pending, or completed action
or suit by or in the right of the corporation to procure a judgment in its
favor, by reason of the fact that he is or was a director, officer, employee, or
agent of the corporation, or is or was serving at the request of the corporation
as a director, trustee, officer, employee, member, manager, or agent of another
corporation, domestic or foreign, nonprofit or for profit, a limited liability
company, or a partnership, joint venture, trust, or other enterprise, against
expenses, including attorney's fees, actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit, if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation, except that no indemnification shall be made
in respect of (a) any claim, issue, or matter as to which such person shall have
been adjudged to be liable for negligence or misconduct in the performance of
his duty to the corporation unless, and only to the extent, that the court of
common pleas or the court in which such action or suit was brought determines,
upon application, that, despite the adjudication of liability, but in view of
all the circumstances of the case, such person is fairly and reasonably entitled
to indemnity for such expenses as the court of common pleas or such other court
shall deem proper,
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<PAGE> 5
and (b) any action or suit in which the only liability asserted against a
director is pursuant to Section 1701.95 of the Ohio Revised Code concerning
unlawful loans, dividends and distribution of assets.
In addition, Section 1701.13(E) requires a corporation to pay any
expenses, including attorney's fees, of a director in defending an action, suit,
or proceeding referred to above as they are incurred, in advance of the final
disposition of the action, suit, or proceeding, upon receipt of an undertaking
by or on behalf of the director in which he agrees to both (i) repay such amount
if it is proved by clear and convincing evidence that his action or failure to
act involved an act or omission undertaken with deliberate intent to cause
injury to the corporation or undertaken with reckless disregard for the best
interests of the corporation and (ii) reasonably cooperate with the corporation
concerning the action, suit, or proceeding. Section 1701.13(E) further
authorizes a corporation to enter into contracts regarding indemnification and
to purchase and maintain insurance on behalf of any director, trustee, officer,
employee or agent for any liability asserted against him or arising out of his
status as such. The Company presently has contracts with each of its directors
and key officers and maintains insurance for the benefit of persons entitled to
indemnification.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
<PAGE> 6
ITEM 9. UNDERTAKINGS
(a) The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Company's annual
report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934
(and, where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Company of expenses incurred or
paid by a director, officer or controlling person of the Company 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 Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(c) The Company 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 of 1933;
(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;
and
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<PAGE> 7
(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 (1)(i) and (ii) above do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by
the Company pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in
this registration statement.
(2) That for the purpose of determining liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
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<PAGE> 8
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
the requirements for filing on Form S-8, and has duly caused this Post Effective
Amendment No. 2 to Registration Statement No. 333-63797 to be signed on its
behalf by the undersigned, there unto duly authorized, in the City of Akron,
State of Ohio, on February 12, 1999.
FirstMerit Corporation
By: /s/John R. Cochran
-----------------------------
John R. Cochran, Chairman and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Post
Effective Amendment No. 2 to Registration Statement No. 333-63797 has been
signed by the following persons in the capacities and on the dates indicated.
SIGNATURE TITLE
/s/John R. Cochran Chairman and Chief Executive Officer
- -------------------------- (Principal Executive Officer) and
John R. Cochran Director
/s/ Austin J. Mulhern Executive Vice President, Finance and
- ------------------------------- Administration (Chief Financial Officer
Austin J. Mulhern and Chief Accounting Officer)
Karen S. Belden* Director
- -------------------------------
Karen S. Belden
R. Cary Blair* Director
- -------------------------------
R. Cary Blair
John C. Blickle* Director
- -------------------------------
John C. Blickle
Sid A. Bostic* Director
- -------------------------------
Sid A. Bostic
Philip A. Lloyd, II* Director
- -------------------------------
Philip A. Lloyd, II
Richard Colella* Director
- -------------------------------
Richard Colella
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Elizabeth A. Dalton* Director
- -------------------------------
Elizabeth A. Dalton
Terry L. Haines* Director
- -------------------------------
Terry L. Haines
Clifford J. Isroff* Director
- -------------------------------
Clifford J. Isroff
Robert G. Merzweiler* Director
- -------------------------------
Robert G. Merzweiler
Roger T. Read* Director
- -------------------------------
Roger T. Read
Justin T. Rogers, Jr.* Director
- -------------------------------
Justin T. Rogers, Jr.
Richard N. Seaman* Director
- -------------------------------
Richard N. Seaman
Jerry M. Wolf* Director
- -------------------------------
Jerry M. Wolf
Charles F. Valentine* Director
- -------------------------------
Charles F. Valentine
*The undersigned, by signing his name hereto, does sign and execute
this amendment to a registration statement on behalf of each of the indicated
officers and directors of FirstMerit Corporation pursuant to a Power of Attorney
executed by each such officer and director and filed with this registration
statement.
Dated: February 12, 1999 /s/ Kevin C. O'Neil
------------------------
Kevin C. O'Neil
Attorney-in-Fact
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
AMENDMENT NO. 2 TO FORM S-4 ON FORM S-8 REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
--------------------
FIRSTMERIT CORPORATION
(EXACT NAME OF ISSUER AS SPECIFIED IN ITS CHARTER)
---------------
EXHIBITS
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<PAGE> 11
EXHIBIT INDEX
4.2 Signal Amended and Restated Stock Option and Incentive Plan
4.3 Signal Non-Employee Director Stock Option Plan
4.4 Signal 1997 Omnibus Incentive Plan
4.5 FirstShenango Bancorp, Inc. 1993 Stock Option Plan
4.6 Summit Bancorp 1989 Stock Incentive Plan
4.7 Amended and Restated Articles of Incorporation of FirstMerit
Corporation, as amended (incorporated by reference from Exhibit 3(a) to
the Form 8-K filed by the registrant on April 9, 1998 and Exhibit 4 to
the Form 8-K filed by the registrant on June 22, 1998)
4.8 Amended and Restated Code of Regulations of FirstMerit Corporation
(incorporated by reference from Exhibit 3(b) to the Form 10-K filed by
the registrant on April 9, 1998)
4.9 Shareholders Rights Agreement dated October 21, 1993, between
FirstMerit Corporation and FirstMerit Bank, N.A., as amended and
restated July 18, 1996 (incorporated by reference from Exhibit 4 to the
Form 8-A/A filed by the registrant on July 18, 1996)
5.1 Opinion of Brouse McDowell, A Legal Professional Association
23.9 Consent of Brouse McDowell, A Legal Professional Association (included
in Exhibit 5.1)
23.10 Consent of PricewaterhouseCoopers, L.L.P.
23.11 Consent of Deloitte & Touche, LLP
23.12 Consent of Deloitte & Touche, LLP
23.13 Consent of KPMG LLP
23.14 Consent of Ernst & Young, LLP
24. Limited Power of Attorney
<PAGE> 1
Exhibit 4.2
FIRST FEDERAL FINANCIAL SERVICES CORP.
AMENDED AND RESTATED STOCK OPTION AND INCENTIVE PLAN
1. PLAN PURPOSE. The purpose of the Plan is to promote the long-term
interests of the Corporation and its stockholders by providing a means for
attracting and retaining directors, officers and employees of the Corporation
and its Affiliates and for promoting employee and director stock ownership in
the Corporation. This plan is an amendment and restatement of the First Federal
Savings and Loan Association of Wooster 1987 Stock Option and Incentive Plan. No
change to the First Federal Savings and Loan Association of Wooster 1987 Stock
Option and Incentive Plan (i) increases the aggregate number of Shares with
respect to which Awards may be made under such Plan; (ii) materially increases
the benefits accruing to Participants under the Plan; (iii) changes the class of
persons eligible to participate in the Plan; or (iv) creates an extension or
modification (as such term is defined at Section 425 of the Code) of an existing
Incentive Stock Option.
2. DEFINITIONS. The following definitions are applicable to the Plan:
"Affiliate" - means any "parent corporation" or "subsidiary
corporation" of the corporation as such terms are defined in Section 424 (e) and
(f), respectively, of the Code.
"Award" - means the grant by the Committee of an Incentive Stock
Option, a Non- Qualified Stock Option, a Stock Appreciation Right, a Limited
Stock Appreciation Right, or of Restricted Stock, or any combination thereof, as
provided in the Plan.
"Code" - means the Internal Revenue Code of 1986, as amended.
"Committee" - means the Committee referred to in Section 3 hereof.
"Continuous Service" - means the absence of any interruption or
termination of service as a director, officer or employee of the corporation or
an Affiliate, except that when used with respect to persons granted an incentive
Stock Option shall mean the absence of any interruption or termination of
service as an employee of the Corporation or an Affiliate. Service shall not be
considered interrupted in the case of sick leave, military leave or any other
leave of absence approved by the Corporation or in the case of transfers between
payroll locations of the corporation or between the Corporation, its parent, its
subsidiaries or its successor.
"Corporation" - means First Federal Financial Services Corp., an
Ohio corporation and savings and loan holding company of the Association.
"Disinterested Person" - means any member of the Board of Directors
of the Corporation who, at the time discretion under the Plan is exercised, has
not at any time within one year prior of the Corporation or any of its
affiliates (as the term is used in the Exchange Act) except as provided in Rule
16b-3(3)(2)(i) under the Exchange Act and is not selected as a Participant in
the Plan or as a person to whom stock may be allocated or to whom stock options
or stock appreciation rights may be granted pursuant to any other plan of the
Corporation or any of its affiliates (as that
<PAGE> 2
term is used in the Exchange Act) entitling the participants therein to acquire
stock, stock options or stock appreciation rights of the corporation or of any
such affiliates, except as provided in Rule 16b- 3(c)(2)(i) under the Exchange
Act; provided, however, that no recipient of an award granted pursuant to
Section 21 hereof shall be deemed not to be a Disinterested Person solely by
reason of such grant.
"Employee" - means any person who is employed on a full time basis
by the Corporation or any Affiliate.
"ERISA" - means the Employee Retirement Income Security Act of 1974,
as amended.
"Exchange Act" - means the Securities Exchange Act of 1934, as
amended.
"Exercise Price" - means (i) in the case of an Option, the price per
Share at which the Shares subject to such Option may be purchased upon exercise
of such Option and (ii) in the case of a Right, the price per Share (other than
the Market Value per Share on the date of exercise and the Offer Price per Share
as defined in Section 10 hereof) which, upon grant, the Committee determines
shall be utilized in calculating the aggregate value which a Participant shall
be entitled to receive pursuant to Sections 9, 10, or 13 hereof upon exercise of
such Right.
"Incentive Stock Option" - means an option to purchase Shares
granted by the Committee pursuant to Section 6 hereof which is subject to the
limitations and restrictions of Section 8 hereof and is intended to qualify
under Section 422 of the Code.
"Limited Stock Appreciation Right" - means a stock appreciation
right with respect to Shares granted by the Committee pursuant to Sections 6 and
10 hereof.
"Market Value" - means the average of the high and low quoted sales
price on the date in question (or, if there is no reported sale on such date, on
the last preceding date on which any reported sale occurred) of a Share on the
Composite Tape for the New York Stock Exchange-listed Stocks, or, if on such
date the Shares are not quoted on the composite Tape, on the New York Stock
Exchange, or, if the Shares are not listed or admitted to trading on such
Exchange, on the principal United States securities exchange registered under
the Exchange Act on which the Shares are listed or admitted to trading, or, if
the Shares are not listed or admitted to trading on any such exchange, the
average of the high and low quoted sale price with respect to a Share on such
date on the National Association of Securities Dealers, Inc., Automated
Quotations System, or any similar system then in use, or, if no such quotations
are available, the fair market value on such date of a Share as the committee
shall determine.
"Non-Qualified Stock Option" - means an option to purchase shares
granted by the Committee pursuant to Section 6 hereof, which option is not
intended to qualify under Section 422 of the Code.
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<PAGE> 3
"Option" - means an Incentive Stock Option or a Non-Qualified Stock
Option.
"Participant" - means any director, officer or employee of the
Corporation or any Affiliate who is selected by the Committee to receive an
Award.
"Plan" - means the Amended and Restated Stock Option and Incentive
Plan of the Corporation.
"Related" - means (i) in the case of a Right, a Right which is
granted in connection with, and to the extent exercisable, in whole or in part,
in lieu of, an Option or another Right and (ii) in the case of an Option, an
Option with respect to which and to the extent a Right is exercisable, in whole
or in part, in lieu thereof has been granted.
"Restricted Period" - means the period of time selected by the
Committee for the purpose of determining when restrictions are in effect under
Section 11 hereof with respect to Restricted Stock awarded under the Plan.
"Restricted Stock" - means Shares which have been contingently
awarded to a Participant by the Committee subject to the restrictions referred
to in Section 11 hereof, so long as such restrictions are in effect.
"Right" - means a Limited Stock Appreciation Right or a Stock
Appreciation Right.
"Shares" - means the shares of common stock of the Corporation.
"Senior Officer" - means the Corporation's president, principal
financial officer, or principal accounting officer, any vice-president of the
Corporation in charge of a principal business unit, division or function (such
as sales, administration or finance), any other officer who performs a
policy-making function, or any other person who performs similar policy-making
functions for the Corporation. Officers of the Corporation's Affiliates shall be
deemed officers of the Corporation if they perform such policy-making functions
for the Corporation.
"Stock Appreciation Right" - means a stock appreciation right with
respect to Shares granted by the Committee pursuant to Sections 6 and 9 hereof.
"Ten Percent Beneficial owner" - means the beneficial owner of more
than ten percent of any class of the Corporation's equity securities registered
pursuant to Section 12 of the Exchange Act.
3. ADMINISTRATION. The Plan shall be administered by a Committee
consisting of two or more members, each of whom shall be a Disinterested Person.
The members of the Committee shall be appointed by the Board of Directors of the
Corporation. Except as limited by the express provisions of the Plan, the
Committee shall have sole and complete authority and discretion to (i)
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<PAGE> 4
select Participants and grant Awards; (ii) determine the number of Shares to be
subject to types of Awards generally, as well as to individual Awards granted
under the Plan; (iii) determine the terms and conditions upon which Awards shall
be granted under the Plan; (iv) prescribe the form and terms of instruments
evidencing such grants; and (v) establish from time to time regulations for the
administration of the Plan, interpret the Plan, and make all determinations
deemed necessary or advisable for the administration of the Plan. The Committee
may maintain, and update from time to time as appropriate, a list designating
selected directors as Disinterested Persons. The purpose of such list shall be
to evidence the status of such individuals as Disinterested persons, and the
Board of Directors may appoint to the Committee any individual actually
qualifying as a Disinterested Person, regardless of whether identified as such
on said list.
A majority of the Committee shall constitute a quorum, and the acts
of a majority of the members present at any meeting at which a quorum is
present, or acts approved in writing by a majority of the Committee without a
meeting, shall be acts of the Committee.
4. PARTICIPATION. The committee may select from time to time
Participants in the Plan from those directors, officers and employees (other
than Disinterested Persons), of the Corporation or its affiliates who, in the
opinion of the Committee, have the capacity for contributing to the successful
performance of the Corporation or its affiliates.
5. SHARES SUBJECT TO PLAN. Subject to adjustment by the operation of
Section 12 hereof, the maximum number of Shares with respect to which Awards may
be made under the Plan is 110,234 Shares. The Shares with respect to which
Awards may be made under the Plan may be either authorized and unissued shares
or issued shares heretofore or hereafter reacquired and held as treasury shares.
Shares which are subject to Related Rights and Related Options shall be counted
only once in determining whether the maximum number of Shares with respect to
which Awards may be granted under the Plan has been exceeded. an Award shall not
be considered to have been made under the Plan with respect to any Option or
right which terminates or with respect to Restricted Stock which is forfeited,
and new Awards may be granted under the Plan with respect to the number of
Shares as to which such termination or forfeiture has occurred.
6. GENERAL TERMS AND CONDITIONS OF OPTIONS AND RIGHTS. The Committee
shall have full and complete authority and discretion, except as expressly
limited by the Plan, to grant Options and/or Rights and to provide the terms and
conditions (which need not be identical among Participants) thereof. In
particular, the Committee shall prescribe the following terms and conditions:
(i) the Exercise Price of any Option or Right, which shall not be less than the
Market Value per Share at the date of grant of such Option or Right (ii) the
number of Shares subject to, and the expiration date of, any Option or Right,
which expiration date shall not exceed ten years from the date of grant, (iii)
the manner, time and rate (cumulative or otherwise) of exercise of such Option
or Right, and (iv) the restrictions, if any, to be placed upon such Option or
Right. The Committee may, as a condition of granting any Option or Right,
require that a Participant agree not to thereafter exercise one or more Options
or Rights previously granted to such Participant.
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<PAGE> 5
7. EXERCISE OF OPTIONS OR RIGHTS.
(a) An Option or Right granted under the Plan shall be exercisable
during the lifetime of the Participant to whom such Option or Right was granted
only by such Participant, and except as provided in paragraphs (c) and (d) of
this Section 7, no such Option or Right may be exercised unless at the time such
Participant exercises such Option or Right, such Participant has maintained
Continuous Service since the date of grant of such Option or Right.
(b) To exercise an Option or Right under the Plan, the Participant
to whom such Option or Right was granted shall give written notice to the
Corporation in form satisfactory to the Committee (and, if partial exercises
have permitted by the Committee, by specifying the number of Shares with respect
to which such Participant elects to exercise such Option or Right) together with
full payment of the Exercise Price, if any and to the extent required. The date
of exercise shall be the date on which such notice is received by the
Corporation. Payment, if any is required, shall be made in cash (including
check, bank draft or money order).
(c) If a Participant to whom an Option or right was granted shall
cease to maintain Continuous Service for any reason (including voluntary
termination, total and partial disability and normal and early retirement, but
excluding death and termination of employment by the Corporation or any
Affiliate for cause), all rights under any Option or right granted to such
Participant shall cease unless the Committee otherwise determines and so
provides in the applicable instrument or instruments evidencing the grant of
such Option or Right in which case such Participant may, but only within the
period of three months immediately succeeding such cessation of Continuous
Service and in no event after the expiration date of such Option or Right,
exercise such Option or Right to the extent that such Participant was entitled
to exercise such Option or Right at the date of such cessation. If the
Continuous Service of a Participant to whom an Option or Right was granted by
the Corporation is terminated for cause, all rights under any Option or Right of
such Participant shall expire immediately upon the giving to the Participant of
notice of such termination.
(d) In the event of the death of a Participant while in the
Continuous Service of the Corporation or an Affiliate or within the three month
period referred to in paragraph (c) of this Section 7, the person to whom any
Option or Right held by the Participant at the time of his death is transferred
by will or the laws of descent and distribution, may, but only to the extent
such Participant was entitled to exercise such Option or Right immediately prior
to his death, exercise such Option or Right at any time within a period of one
year succeeding the date of death of such Participant, but in no event later
than ten years from the date of grant of such Option or Right. Following the
death of any Participant to whom an Option was granted under the Plan,
irrespective of whether any Related Right shall have theretofore been granted to
the Participant or whether the person entitled to exercise such Related Right
desires to do so, the Committee may, as an alternative means of settlement of
such Option, elect to pay in cash to the person to whom such Option is
transferred by will or by the laws of descent and distribution or, in the case
of an option, other than an Incentive Stock Option, pursuant to a qualified
domestic relations order as defined in the Code or Title I of ERISA, the amount
by which the Market Value per Share on the date of exercise of such
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<PAGE> 6
Option shall exceed the Exercise Price of such Option, multiplied by the number
of Shares with respect to which such Option is properly exercised. Any such
settlement of an Option shall be considered an exercise of such Option for all
purposes of the Plan.
8. INCENTIVE STOCK OPTIONS. Incentive Stock Options may be granted
only to Participants who are Employees. Any provision of the Plan to the
contrary notwithstanding, (i) no Incentive Stock Option shall be granted more
than ten years after the date the Plan was adopted by the Board of Directors of
the Association, the predecessor in interest of the Corporation and no Incentive
Stock Option shall be exercisable more than ten years from the date such
Incentive Stock Option is granted, (ii) the Exercise Price of any Incentive
Stock Option shall not be less than the Market Value per Share on the date such
Incentive Stock Option is granted, (iii) any Incentive Stock Option shall not be
transferable by the Participant to whom such Incentive Stock Option is granted
other than by will or the laws of descent and distribution, and shall be
exercisable during such Participant's lifetime only by such Participant, (iv) no
Incentive Stock Option shall be granted to any individual who, at the time such
Incentive Stock Option is granted, owns stock possessing more than 10% of the
total combined voting power of all classes of stock of the Corporation or any
Affiliate unless the Exercise Price of such Incentive Stock Option is at least
110% of the Market Value per Share at the date of grant and such Incentive Stock
Option is not exercisable after the expiration of five years from the date such
Incentive Stock Option is granted, and (v) the aggregate Market Value,
determined as of the time any Incentive Stock Option is granted, of the Shares
for which any Participant may be granted Incentive Stock Options in any calendar
year may exceed $100,0000, but the aggregate Market Value, determined at the
time an Incentive Stock Option is granted, of the Shares with respect to which
Incentive Stock Options become exercisable for the first time under the terms of
the grant during any calendar year, may not exceed $100,000 for any Participant.
9. STOCK APPRECIATION RIGHTS. A Stock Appreciation Right shall, upon
its exercise, entitle the Participant to whom such Stock Appreciation Right was
granted to receive a number of Shares or cash or combination thereof, as the
Committee in its discretion shall determine, the aggregate value of which (i.e.,
the sum of the amount of cash and/or Market Value of such Shares on date of
exercise) shall equal (as nearly as possible, it being understood that the
Corporation shall not issue any fractional shares) the amount of which the
Market Value per Share on the date of such exercise shall exceed the Exercise
Price of such Stock Appreciation Right, multiplied by the number of Shares with
respect of which such Stock Appreciation Right shall have been exercised. A
Stock Appreciation Right may be Related to an Option or may be granted
independently of any Option as the Committee shall from time to time in each
case determine. At the time of grant of an Option or subsequent thereto, the
Committee shall determine whether and to what extent a Related Stock
Appreciation Right shall be granted with respect thereto; provided, however, and
notwithstanding any other provision of the Plan, that if the Related Option is
an Incentive Stock Option, the Related Stock Appreciation Right shall satisfy
all the restrictions and limitations of Section 8 hereof as if such Related
Stock Appreciation Right were an Incentive Stock Option and as if other rights
which are Related to Incentive Stock Options were Incentive Stock Options. In
the case of a Related Option, such Related Option shall cease to be exercisable
to the extent of the Shares with respect to which the Related Stock Appreciation
Right was exercised. Upon the exercise or termination of a Related
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<PAGE> 7
Option, any Related Stock Appreciation Right shall terminate to the extent of
the Shares with respect to which the Related Option was exercised or terminated.
Notwithstanding the foregoing, no Stock Appreciation Right shall be exercisable
by a Ten Percent Beneficial Owner, director or Senior Officer of the Corporation
within six months of the date of its grant.
10. LIMITED STOCK APPRECIATION RIGHTS. At the time of grant of an
Option or Stock Appreciation Right to any Participant, the Committee shall have
full and complete authority and discretion to also grant to such Participant a
Limited Stock Appreciation Right which is Related to such Option or Stock
Appreciation Right; provided, however, and notwithstanding any other provision
of the Plan, that if the Related Option is an Incentive Stock Option, the
Related Limited Stock Appreciation Right shall satisfy all of the restrictions
and limitations of Section 8 hereof as if such Related Limited Stock
Appreciation Right were an Incentive Stock Option and as if all other Rights
which are Related to Incentive Stock Options were Incentive Stock Options.
Notwithstanding any other provision of the Plan, a Limited Stock Appreciation
Right shall be exercisable only during the period beginning on the first day
following the date of expiration of any "offer" (as such term is hereinafter
defined) and ending on the forty-fifth day following such date, provided,
however, that no Limited Stock Appreciation Right shall be exercisable by a Ten
Percent Beneficial Owner, director of Senior Officer of the Corporation within
six months of the date of its grant.
A Limited Stock Appreciation Right shall, upon its exercise, entitle
the Participant to whom such Limited Stock Appreciation Right was granted to
receive an amount of cash equal to the amount by which the "Offer Price per
Share" (as such term is hereinafter defined) or the Market Value on the date of
such exercise, as shall have been provided by the Committee in its discretion at
the time of grant, shall exceed the Exercise Price of such Limited Stock
Appreciation Right, multiplied by the number of Shares with respect to which
such Limited Stock Appreciation Right shall have been exercised. Upon the
exercise of a Limited Stock Appreciation Right, any Related Option and/or
Related Stock Appreciation Right shall cease to be exercisable to the extent of
the Shares with respect to which such Limited Stock Appreciation Right was
exercised. Upon the exercise or termination of a Related Option or Related Stock
Appreciation Right, any Related Limited Stock Appreciation Right shall terminate
to the extent of the Shares with respect to which such Related Option or Related
Stock Appreciation Right was exercised or terminated.
For the purposes of this Section 10, the term "Offer" shall mean any
tender offer or exchange offer for Shares other than one made by the
Corporation, provided that the corporation, person or other entity making the
offer acquires pursuant to such offer either (i) 25% of the Shares outstanding
immediately prior to the commencement of such offer of (ii) a number of shares
which, together with all other shares acquired in any tender offer or exchange
offer (other than one made by the Corporation) which expired within sixty days
of the expiration date of the offer in question, equals 25% of the Shares
outstanding immediately prior to the commencement of the offer in question. The
term "Offer Price per Share" as used in this Section 10 shall mean the highest
price per Share paid in any Offer which Offer is in effect any time during the
period beginning on the sixtieth day prior to the date on which a Limited Stock
Appreciation Right is exercised and ending on the date on which such Limited
Stock Appreciation Right is exercised. Any securities or property which are part
or all
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<PAGE> 8
of the consideration paid for Shares in the Offer shall be valued in determining
the Offer Price per Share at the higher of (A) the valuation placed on such
securities or property by the corporation, person or other entity making such
Offer or (B) the valuation placed on such securities or property by the
Committee. Notwithstanding the foregoing, no Stock, no Limited Stock
Appreciation Right shall be exercisable by the director or Senior Officer of the
Corporation within six months of the date of its grant.
11. TERMS AND CONDITIONS OF RESTRICTED STOCK. The Committee shall
have full and complete authority, subject to the limitations of the Plan, to
grant awards of Restricted Stock and, in addition to the terms and conditions
contained in paragraphs (a) through (f) of this Section 11, to provide such
other terms and conditions (which need not be identical among Participants) in
respect of such Awards, and the vesting thereof, as the Committee shall
determine and provide in the agreement referred to in paragraph (d) of this
Section 11.
(a) At the time of an Award of Restricted Stock, the Committee
shall establish for each Participant a Restricted Period of not less than six
months during which or at the expiration of which, as the Committee shall
determine and provide in the agreement referred to in paragraph (d) of this
Section 11, the Shares awarded as Restricted Stock shall vest, and subject to
any such other terms and conditions as the Committee shall provide, Shares of
Restricted Stock may not be sold, assigned, transferred, pledged or otherwise
encumbered by the Participant, except as hereinafter provided, during the
Restricted Period. Except for such restrictions, and subject to paragraphs (c),
(d) and (e) of this Section 11 and Section 12 hereof, the Participant as owner
of such Shares shall have all the rights of a stockholder including but not
limited to the right to receive all dividends paid on such shares and the right
to vote such Shares. The Committee shall have the authority, in its discretion,
to accelerate the time at which any or all of the restrictions shall lapse with
respect to any Shares of Restricted Stock prior to the expiration of the
Restricted Period with respect thereto, or to remove any or all of such
restrictions, whenever it 1may determine that such action is appropriate by
reason of changes in applicable tax or other laws or other changes in
circumstances occurring after the commencement of such Restricted Period.
(b) Except as provided in Section 14 hereof, if a Participant
ceases to maintain Continuous Service for any reason (other than death, total or
partial disability or normal or early retirement) unless the Committee shall
otherwise determine and provide in the agreement referred to in paragraph (d) of
this Section 11, all shares of Restricted Stock theretofore awarded to such
Participant and which at the time of such termination of Continuous Service are
subject to the restrictions imposed by paragraph (a) of this Section 11 shall
upon such termination of Continuous Service be forfeited and returned to the
Corporation. Unless the Committee shall have provided otherwise in the agreement
referred to in paragraph (d) of this Section 11 for a ratable lapse of
restrictions in accordance with vesting provisions set forth in the aforesaid
agreement, if a Participant ceases to maintain Continuous Service solely by
reason of death, total or partial disability or normal or early retirement, then
those shares of Restricted Stock which at the time of termination of Continuous
Service (for the reasons set forth in this sentence) are subject to the
restrictions imposed by paragraph (a) of this Section 11 shall vest on a PRO
RATA basis as herein provided: The shares of
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<PAGE> 9
Restricted Stock which at the time of such termination of Continuous Service are
subject to a restricted period which is definitely determinable at the time of
grant shall become free of restrictions, vested and nonforfeitable in the
proportion that the Participant's number of complete 12-consecutive month
periods of Continuous Service during the definitely determinable restricted
period contained in the Participant's agreement referred to in paragraph (d) of
this Section 11 bears to the number of 12-consecutive month periods of
Continuous Service of the definitely determinable restricted period contained in
the Participant's agreement referred to in paragraph (d) of this Section 11.
Notwithstanding the foregoing, in the event that the agreement referred to in
paragraph (d) of this Section 11 also provides for the attainment of certain
performance goals prior to or concurrent with the lapse of any restrictions
hereunder, the provisions in the preceding sentence providing for a PRO RATA
release of shares of Restricted Stock by reasons of total or partial disability
or normal or early retirement shall not be applicable unless the performance
goals set forth in the aforesaid agreement shall have been attained no later
than the conclusion of the restricted period. In the event that such performance
goals are attained at the conclusion of the restricted period, such a
Participant shall be entitled to receive shares of Restricted Stock, free and
clear of all restrictions, based on the formula set forth in this Section 11(b)
at the conclusion of the restricted period. In the event that such performance
goals are not completely achieved, but the aforesaid agreement expressly
contemplated the release of restrictions of a given percentage or number of
shares of Restricted Stock upon partial attainment of a specified performance
goal, a Participant whose Continuous Service had terminated by reason of total
or partial disability or normal or early retirement shall be entitled to
receive, free and clear of all restrictions, at the conclusion of the restricted
period, a number of shares of Restricted Stock determined by multiplying (a) the
number of shares of Restricted Stock released from their restrictions upon
partial attainment of a specified performance goal (as set forth in the
aforesaid agreement), by (b) the fraction determined in this Section 11(b) based
upon such Participant's 12- consecutive month period of Continuous Service. In
the event of a Participant's death prior to the expiration of the restricted
period set forth in the aforesaid Agreement and prior to his termination of
Continuous Service, a Participant shall be entitled to a PRO RATA release of
shares of Restricted Stock as set forth in this Section 11(b), without regard to
whether the aforesaid agreement contains performance goals or whether those
goals have been fully or partially attained.
(c) Each certificate in respect of shares of Restricted Stock
awarded under the Plan shall be registered in the name of the Participant and
deposited by the Participant, together with a stock power endorsed in blank,
with the Corporation and shall bear the following (or a similar) legend:
"The transferability of this certificate and the shares of
stock represented hereby are subject to the terms and conditions (including
forfeiture) contained in the Amended and Restated Stock Option and Incentive
Plan of First Federal Financial Services Corp. and an Agreement entered into
between the registered owner and First Federal Financial Services Corp. Copies
of such Plan and Agreement are on file in the offices of the Secretary of First
Federal Financial Services Corp., 135 East Liberty Street, Wooster, Ohio 44691."
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<PAGE> 10
(d) At the time of an award of shares of Restricted Stock,
the Participant shall enter into an Agreement with the Corporation in a form
specified by the Committee, agreeing to the terms and conditions of the award
and such other matters as the Committee shall in its sole discretion determine.
(e) At the time of an award of shares of Restricted Stock,
the Committee may, in its discretion, determine that the payment to the
Participant of dividends declared or paid on such shares, or specified portion
thereof, by the Corporation shall be deferred until the earlier to occur of (i)
the lapsing of the restrictions imposed under paragraph (a) of this Section 11
or (ii) the forfeiture of such shares under paragraph (b) of this Section 11,
and shall be held by the Corporation for the account of the Participant until
such time. In the event of such deferral, there shall be credited at the end of
each year (or portion thereof) interest on the amount of the account at the
beginning of the year at a rate per annum as the Committee, in its discretion,
may determine. Payment of deferred dividends, together with interest accrued
thereon as aforesaid, shall be made upon the earlier to occur of the events
specified in (i) and (ii) of the immediately preceding sentence.
(f) At the expiration of the restrictions imposed by
paragraph (a) of this Section 11, the Corporation shall deliver to the
Participant (or where the relevant provision of paragraph (b) of this Section 11
applies in the case of a deceased Participant, to his legal representative,
beneficiary or heir) a certificate(s) and stock power free of the restrictions
referred to in paragraph (a) of this Section 11.
12. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. In the event of any
change in the outstanding Shares subsequent to the effective date of the Plan by
reason of any reorganization, recapitalization, stock split, stock dividend,
combination or exchange of shares, merger, consolidation or any change in the
corporate structure or Shares of the Corporation, the maximum aggregate number
and class of shares as to which Awards may be granted under the Plan and the
number and class of shares with respect to which Awards theretofore have been
granted under the Plan shall be appropriately adjusted by the Committee, whose
determination shall be conclusive. Any shares of stock or other securities
received, as a result of any of the foregoing, by a Participant with respect to
Restricted Stock shall be subject to the same restrictions and the
certificate(s) or other instruments representing or evidencing such shares or
securities shall be legended and deposited with the Corporation in the manner
provided in Section 11 hereof.
13. EFFECT OF MERGER ON OPTIONS OR RIGHTS. In the case of any
merger, consolidation or combination of the Corporation (other than a merger,
consolidation or combination in which the Corporation is the continuing
corporation and which does not result in the outstanding Shares being converted
into or exchanged for different securities, cash or other property, or any
combination thereof), any Participant to whom an Option or Right has been
granted under the Plan shall have the right (subject to the provisions of the
Plan and any limitation applicable to such Option or Right), thereafter and
during the term of each such Option or Right, to receive upon exercise of any
such Option or Right an amount equal to the excess of the fair market value on
the date of such exercise of the securities, cash or other property, or
combination thereof, receivable upon such merger,
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<PAGE> 11
consolidation or combination in respect of a Share over the Exercise Price of
such Right or Option, multiplied by the number of Shares with respect to which
such Option or Right shall have been exercised. Such amount may be payable fully
in cash, fully in one or more of the kind or kinds of property payable in such
merger, consolidation or combination, or partly in cash and partly in one or
more of such kind or kinds of property, all in the discretion of the Committee.
14. EFFECT OF CHANGE IN CONTROL. Each of the events specified in the
following clauses (i) through (iii) of this Section 14 shall be deemed a "change
of control": (i) any third person, including a "group" as defined in Section
13(d)(3) of the Exchange Act, shall become the beneficial owner of shares of the
Corporation with respect to which 25% or more of the total number of votes for
the election of the Board of Directors of the Corporation may be cast, (ii) as a
result of, or in connection with, any cash tender offer, merger or other
business combination, sale of assets or contested election, or combination of
the foregoing, the persons who were directors of the Corporation shall cease to
constitute a majority of the Board of Directors of the Corporation or (iii) the
stockholders of the Corporation shall approve an agreement providing either for
a transaction in which the Corporation will cease to be an independent publicly
owned corporation or for a sale or other disposition of all or substantially all
the assets of the Corporation; provided, however, that the occurrence of any
such events shall not be deemed a "change in control" if, prior to such
occurrence, a resolution specifically approving such occurrence shall have been
adopted by at least a majority of the Board of Directors of the Corporation. If
the Continuous Service of any Participant of the Corporation or any Affiliate is
involuntarily terminated for whatever reason, at any time within eighteen months
after a change in control, unless the Committee shall have otherwise provided in
the agreement referred to in paragraph (d) of Section 11 hereof, any Restricted
Period with respect to Restricted Stock theretofore awarded to such Participant
shall lapse upon such termination and all shares awarded as Restricted Stock
shall become fully vested in the Participant to whom such Shares were awarded.
If a tender offer or exchange offer for Shares (other than such an offer by the
Corporation) is commenced, or if the event specified in clause (iii) above shall
occur, unless the Committee shall have otherwise provided in the instrument
evidencing the grant of an Option or Stock Appreciation Right, all Options and
Stock Appreciation Rights theretofore granted and not fully exercisable shall
become exercisable in full upon the happening of such event and shall remain so
exercisable for a period of sixty days following such date after which they
shall revert to being exercisable in accordance with their terms; provided,
however, that no Option or Stock Appreciation Right shall be exercisable by a
Ten Percent Beneficial Owner, director or Senior Officer of the Corporation
within six months of the date of grant of such Option or Stock Appreciation
Right and no Option or Stock Appreciation Right which has previously been
exercised or otherwise terminated shall become exercisable.
15. ASSIGNMENTS AND TRANSFERS. No Award nor any right or interest of
a Participant under the Plan in any instrument evidencing any Award under the
Plan may be assigned, encumbered or transferred except, in the event of the
death of a Participant, by will or the laws of descent and distribution or in
the case of an Award, other than an Incentive Stock Option, pursuant to a
qualified domestic relations order as defined in the Code or Title I of the
ERISA or the rules thereunder.
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<PAGE> 12
16. EMPLOYEE RIGHTS UNDER THE PLAN. No officer or employee shall
have a right to be selected as a Participant nor, having been so selected, to be
selected again as a Participant and no officer, employee or other person shall
have any claim or right to be granted an Award under the Plan or under any other
incentive or similar plan of the Corporation or any Affiliate. Neither the Plan
nor any action taken thereunder shall be construed as giving any employee any
right to be retained in the employ of the Corporation or any Affiliate.
17. DELIVERY AND REGISTRATION OF STOCK. The Corporation's obligation
to deliver Shares with respect to an Award shall, if the Committee so requests,
be conditioned upon the receipt of a representation as to the investment
intention of the Participant to whom such Shares are to be delivered, in such
form as the Committee shall determine to be necessary or advisable to comply
with the provision of the Securities Act of 1933 or any other Federal, state or
local securities legislation. It may be provided that any representation
requirement shall become inoperative upon a registration of the Shares or other
action eliminating the necessity of such representation under such Securities
Act or other securities legislation. The Corporation shall not be required to
deliver any Shares under the Plan prior to (i) the admission of such shares to
listing on any stock exchange on which Shares may then be listed, and (ii) the
completion of such registration or other qualification of such Shares under any
state or Federal law, rule or regulation, as the Committee shall determine to be
necessary or advisable.
This Plan is intended to comply with Rule 16b-3 under the Exchange
Act. Any provision of the Plan which is inconsistent with said Rule shall, to
the extent of such inconsistency, be inoperative and shall not affect the
validity of the remaining provisions of the Plan.
18. WITHHOLDING TAX. Upon the termination of the Restricted Period
with respect to any shares of Restricted Stock the Corporation shall have the
right to require the Participant or other person receiving such shares to pay
the Corporation the amount of any taxes which the Corporation is required to
withhold with respect to such shares, or, in lieu thereof, to retain or sell
without notice, a sufficient number of shares held by it to cover the amount
required to be withheld. The Corporation shall have the right to deduct from all
dividends paid with respect to shares of Restricted Stock the amount of any
taxes which the Corporation is required to withhold with respect to such
dividend payments.
The Corporation shall have the right to deduct from all amounts paid
in cash with respect to the exercise of a Right under the Plan any taxes
required by law to be withheld with respect to such cash payments. Where a
Participant or other person is entitled to receive Shares pursuant to the
exercise of an Option or Right pursuant to the Plan, the Corporation shall have
the right to require the Participant or such other person to pay the Corporation
the amount of any taxes which the Corporation is required to withhold with
respect to such Shares, or, in lieu thereof, to retain, or sell without notice,
a number of such Shares sufficient to cover the amount required to be withheld.
19. AMENDMENT OR TERMINATION. The Board of Directors of the
Corporation may amend, suspend or terminate the Plan or any portion thereof at
any time, but (except as provided in Section
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12 hereof) no amendment shall be made without approval of the stockholders of
the Corporation which shall (i) materially increase the aggregate number of
Shares with respect to which Awards may be made under the Plan; (ii) materially
increase the benefits accruing to Participants under the Plan or (iii) change
the class of persons eligible to participate in the Plan; provided, however,
that no such amendment, suspension or termination shall impair the rights of any
Participant, without his consent, in any Award theretofore made pursuant to the
Plan.
20. EFFECTIVE DATE AND TERM OF PLAN. The Plan became effective upon
its adoption by the Board of Directors of the Association, the predecessor in
interest of the Corporation, and was approved by vote of the holders of a
majority of the outstanding shares of the Association entitled to vote on the
adoption of the Plan. The Plan was assumed by the Corporation pursuant to the
reorganization of the Association to the holding company form effective July 21,
1989. This Plan shall continue in effect until the date ten years from the date
the Plan was initially adopted by the Board of Directors of the Association,
unless sooner terminated under Section 19 hereof.
21. Notwithstanding anything in this Plan to the contrary, to the
extent the Plan is amended to provide for formula awards, as defined in Rule
16b-3(c)(2)(ii) under the Exchange Act, such provisions may not be amended more
than once every six months, other than to comport with changes in the Code,
ERISA or the rules thereunder.
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<PAGE> 1
Exhibit 4.3
FIRSTFEDERAL FINANCIAL SERVICES CORP
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
1. PURPOSE. This Non-Employee Director Stock Option Plan (the "Plan")
is intended to promote the interests of FirstFederal Financial Services Corp
(the "Company") by providing an inducement to attract and retain the services of
qualified persons who are neither employees nor officers of the Company to serve
as members of the Board of Directors and by demonstrating the Company's
appreciation for their service on the Company's Board of Directors.
2. OPTIONS TO BE GRANTED. Under the Plan, options are granted that give
an optionee the right for a specified time period to purchase a specified number
of shares of Common Stock, par value $1.00 per share, of the Company (the
"Common Stock"). The option price is determined in each instance in accordance
with the terms of this Plan.
3. AVAILABLE SHARES. The total number of shares of Common Stock for
which options may be granted shall not exceed 100,000 shares, subject to
adjustment in accordance with Section 13 hereof. Shares subject to the Plan are
authorized but unissued shares or shares that were once issued and subsequently
reacquired by the Company. If any options granted under this Plan are
surrendered before exercise or lapse without exercise, in whole or in part, the
shares reserved therefor shall revert to the option pool and again become
available for grant under the Plan.
4. ADMINISTRATION. The Plan shall be administered by the Compensation
and Benefits Committee of the Board of Directors of the Company (the
"Committee"), each member of which, except as otherwise provided in Rule 16b-
3(c)(2)(i)(A)-(D) (or any successor provision thereto) under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), shall not have been
granted or awarded during the one year period prior to service as an
administrator of a plan of the Company (or any of its affiliates), equity
securities pursuant to the Plan or any other plan of the Company (or any of its
affiliates). The Committee shall, subject to the provisions of the Plan and
Section 16 hereof in particular, have the power to construe the Plan, to
determine all questions thereunder, and to adopt and amend such rules and
regulations for the administration of the Plan as it may deem desirable.
5. OPTION AGREEMENT. Each option granted under the provisions of this
Plan shall be evidenced by an Option Agreement, in such form as may be approved
by the Committee, which Agreement shall be duly executed and delivered on behalf
of the Company and by the optionee to whom such option is granted. The Option
Agreement shall contain such terms, provisions and conditions not inconsistent
with the Plan as may be determined by the Committee.
6. ELIGIBILITY AND LIMITATIONS. Options may be granted pursuant to the
Plan only to members of the Board of Directors of the Company who are not
officers or employees of the Company or any of its subsidiaries ("non-employee
directors").
7. EXERCISE PRICE. The exercise price for the purchase of stock covered
by an option granted pursuant to the Plan shall be 100% of the fair market of
such shares on the day the option is granted. The exercise price will be subject
<PAGE> 2
to adjustment in accordance with the provisions of Section 13 hereof. For
purposes of the Plan, the fair market value of a share of Common Stock means the
average of the high and low quoted sales price on the date in question (or, if
there is no reported sale on such date, on the last preceding date on which any
reported sale occurred) of a share of the Composite Tape for the New York Stock
Exchange-Listed Stocks, or, if the shares are not listed or admitted to trading
on such Exchange, on the principal United States securities exchange registered
under the Securities Exchange Act of 1934 on which the shares are listed or
admitted to trading, or if the shares are not listed or admitted to trading on
any such exchange, the mean between the closing high bid and low asked
quotations with respect to a share on such date on the National Association of
Securities Dealers, Inc. Automated Quotations System, or any similar system then
in use, or, if no such quotations are available, the fair market value on such
date of a share as the Committee shall determine.
8. GRANT OF OPTION AWARDS.
(a) INITIAL GRANT OF OPTIONS. Each non-employee director of the Company
who is serving in such capacity on the date of approval of the Plan by
stockholders of the Company, is hereby granted without further action by the
Board or the Committee an option to purchase 2,500 shares of Common Stock.
(b) AUTOMATIC ANNUAL GRANT OF OPTIONS. As of April 30 of each year,
commencing with April 30, 1995, each non-employee director shall be
automatically granted without further action by the Board or the Committee an
option to purchase 1,000 shares of Common Stock. Each person who is neither an
employee nor an officer of the Company or any of its subsidiaries as of April
21, 1994 and who is thereafter appointed (or elected) to the Board of Directors
after April 21, 1994 shall be automatically granted, on the date of the first
such appointment (or election) and without further action by the Board of
Directors or the Committee, an option to purchase 1,000 shares of Common Stock.
If on any date for the grant of options pursuant to the Plan the aggregate
number of shares then remaining available for options under the Plan is less
than the number of option shares which the Plan provides shall be granted on
such date, options shall be granted on the following basis: first, ratably (to
the nearest whole share) to any persons entitled to receive on such date a grant
pursuant to the first sentence of this Section 8(b), up to a maximum grant of
1,000 option shares per optionee; and second, ratably (to the nearest whole
share) to any persons entitled to receive on such date a grant pursuant to the
second sentence of this Section 8(b), up to a maximum grant of 1,000 option
shares per optionee.
9. PERIOD OF OPTIONS. The options granted hereunder shall expire on a
date which is ten years after the date of grant of the options. The Plan shall
terminate when all options granted hereunder have expired or terminated.
10. EXERCISE OF OPTIONS. Subject to the terms and conditions of the
Plan and the Option Agreement, each option granted hereunder shall, to the
extent then exercisable, be exercisable in whole or in part by giving written
notice to the Company by mail or in person addressed to the Secretary of
FirstFederal Financial Services Corp, 135 East Liberty Street, Wooster, Ohio
44691, stating the number of shares with respect to which the option is being
exercised, accompanied by payment in full of the exercise price for such shares,
which payment may be in whole or in part in shares of the Common Stock of the
Company already owned by the person or persons exercising the option, valued at
fair market value determined in accordance with the provisions of Section 7
hereof. Upon notification from the Company, the Transfer Agent shall, on behalf
of the Company, prepare a certificate or certificates representing the shares
acquired
<PAGE> 3
pursuant to exercise of the option, shall register the optionee as the
owner of such shares on the books of the Company and shall cause the fully
executed certificate(s) representing such shares to be delivered to the optionee
as soon as practicable after payment of the option price in full. The holder of
an option shall not have any rights of a stockholder with respect to the shares
covered by the option, except through the due exercise of the option.
11. VESTING OF SHARES AND NON-TRANSFERABILITY OF OPTIONS.
(a) VESTING. Each option granted under the Plan shall vest in the
optionee, and thus become exercisable, six months from the date it was granted.
If either of the following events shall occur, all options theretofore
granted and not fully exercisable shall become exercisable in full upon the
happening of such event and shall remain so exercisable for a period of 60 days
following such date, after which they shall revert to being exercisable in
accordance with their terms (provided that no option which has previously been
exercised or has expired or otherwise terminated shall become exercisable):
(i) a tender offer or exchange offer for shares of Common Stock
(other than such an offer by the Company) is commenced, or
(ii) the stockholders of the Company approve an agreement
providing either for a transaction in which the Company will cease to
be an independent publicly-owned company or for a sale or disposition
of all or substantially all the assets of the Company.
(b) LEGEND ON CERTIFICATES. The certificates representing such shares
shall carry such appropriate legends, and such written instructions shall be
given to the Company's Transfer Agent, as may be deemed necessary or advisable
by counsel to the Company in order to comply with the requirements of the
Securities Act of 1933 or any state securities laws.
(c) NON-TRANSFERABILITY. Any option granted pursuant to the Plan shall
not be assignable or transferable other than by will or the laws of descent and
distribution, and shall be exercisable during the optionee's lifetime only by
him or her.
12. TERMINATION OF OPTIONS.
(a) In the event an optionee ceases to be a member of the Board of
Directors of the Company for any reason other than death, any options not then
exercisable shall immediately terminate and become void. Any options which are
exercisable, but have not been exercised, at the time the optionee so ceases to
be a member of the Board of Directors may be exercised by the optionee within a
period of three months following the date the optionee so ceases to be a member
of the Board of Directors, but in no event later than the expiration date of the
option.
(b) In the event of the death of an optionee while a member of the
Board of Directors of the Company or during the three-month period referred to
in Section 12(a) hereof, any options, whether or not exercisable at the time of
death, may be exercised (by the optionee's personal representative, heir or
legatee) during the period ending one year after the date of such death, but in
no event later than the expiration date of the option. Following the death of
any person to whom an option was granted under the Plan, the Committee may, as
an alternative means of settlement of such option, elect to pay to the person to
<PAGE> 4
whom such option is transferred by will or by the laws of descent and
distribution the amount by which the fair market value per share on the date of
exercise of such option shall exceed the exercise price of such option,
multiplied by the number of shares with respect to which such option is properly
exercised. Any such settlement of an option shall be considered an exercise of
such option for all purposes of the Plan.
13. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION AND OTHER MATTERS. In
the event that the outstanding shares of Common Stock are changed into or
exchanged for a different number or kind of shares of other securities of the
Company or of another corporation by reason of any reorganization, merger,
consolidation, recapitalization or reclassification, or in the event of a stock
split, combination of shares or dividends payable in capital stock, automatic
adjustment shall be made in the number and kind of shares as to which
outstanding options or portions thereof then unexercised shall be exercisable
and in the available shares set forth in Section 3 hereof, to the end that the
proportionate interest of the option holder shall be maintained as before the
occurrence of such event. Such adjustment in outstanding options shall be made
without change in the total price applicable to the unexercised portion of such
options and with a corresponding adjustment in the exercise price per share.
If an option hereunder shall be assumed, or a new option substituted
therefor, as a result of sale of the Company, whether by a corporate merger,
consolidation or sale of property or stock, then membership on the Board of
Directors of such assuming or substituting corporation, or a parent corporation
thereof, shall be considered for purposes of the Plan to be membership on the
Board of Directors of the Company.
14. DELIVERY AND REGISTRATION OF STOCK. The Company's obligation to
deliver shares of Common Stock upon exercise of an option shall, if the
Committee so requests, be conditioned upon the receipt of a representation as to
the investment intention of the optionee to whom such shares are to be
delivered, in such form as the Committee shall determine to be necessary or
advisable to comply with the provision of the Securities Act of 1933 or any
other Federal, state or local securities legislation. It may be provided that
any representation requirement shall become inoperative upon a registration of
the shares or other action eliminating the necessity of such representation
under such Securities Act or other securities legislation. The Company shall not
be required to deliver any shares under the Plan prior to (i) the admission of
such shares to listing on any stock exchange on which shares may then be listed,
and (ii) the completion of such registration or other qualification of such
shares under any state or Federal law, rule or regulation, as the Committee
shall determine to be necessary or advisable.
15. WITHHOLDING TAX. Where an optionee or other person is entitled to
receive shares pursuant to the exercise of an option pursuant to the Plan, the
Company shall have the right in its sole discretion to require the optionee or
such other person to pay to the Company the amount of any taxes which the
Company is required to withhold with respect to such shares.
16. EFFECTIVENESS. Anything in the Plan to the contrary
notwithstanding, the effectiveness of the Plan and of the grant of all options
hereunder is in all respects subject to, and the Plan and options granted under
it shall be of no force and effect unless and until, and no option granted
hereunder shall in any way vest or become exercisable in any respect unless and
until, the approval of the Plan by the Company's stockholders.
<PAGE> 5
17. COMPLIANCE WITH SECTION 16. This Plan is intended to comply with
Rule 16b-3 promulgated under the Exchange Act ("Rule 16b-3"). Any provision of
the Plan which is inconsistent with said Rule shall, to the extent of such
inconsistency, be inoperative and shall not affect the validity of the remaining
provisions of the Plan.
18. TERMINATION AND AMENDMENT OF PLAN. The Board may at any time
terminate the Plan or make such modification or amendment thereof as it deems
advisable, provided, however, that the Board may not, without approval by the
Company's stockholders (or receipt of an opinion of counsel for the Company to
the effect that stockholder approval is not required for continued qualification
of the Plan under Rule 16b-3), (a) materially increase the benefits accruing to
participants under the Plan; (b) materially increase the number of securities
which may be issued under the Plan; or (c) materially modify the requirements as
to eligibility for participation in the Plan. Termination or any modification or
amendment of the Plan shall not, without the consent of an optionee, affect his
or her rights under an option previously granted. Notwithstanding the foregoing,
to the extent that the Plan provides for formula awards, as defined in Rule
16b-3(c)(2)(ii) under the Exchange Act (or any successor provision thereto),
such provisions may not be amended more than once every six months, other than
to comport with changes to the Internal Revenue Code of 1986, as amended, the
Employee Retirement Income Security Act of 1974, as amended, or the rules
thereunder.
<PAGE> 1
Exhibit 4.4
FIRSTFEDERAL FINANCIAL SERVICES CORP
1997 OMNIBUS INCENTIVE PLAN
1. PLAN PURPOSE. The purpose of the Plan is to promote the long-term
interests of the Company and its stockholders by providing a means for
attracting and retaining directors, advisory directors, officers and employees
of the Company and its Affiliates.
2. DEFINITIONS. The following definitions are applicable to the
Plan:
"Affiliate" -- means any "parent corporation" or "subsidiary
corporation" of the Company as such terms are defined in Section 425(e) and (f),
respectively, of the Code.
"Award" -- means the grant by the Committee under this Plan of
an Incentive Stock Option, a Non- Qualified Stock Option, a Stock Appreciation
Right, Restricted Stock or a Performance Award, or any combination thereof, as
provided in the Plan.
"Award Agreement" -- means the agreement evidencing the grant
of an Award made under the Plan.
"Cause" -- means Termination of Service by reason of personal
dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving
personal profit, intentional failure to perform stated duties or gross
negligence.
"Code" -- means the Internal Revenue Code of 1986, as amended.
"Committee" -- means the Committee referred to in Section 3
hereof.
"Company" -- means FirstFederal Financial Services Corp, an
Ohio corporation, and any successor thereto.
"Continuous Service" -- means the absence of any interruption
or termination of service as a director, advisory director, officer or employee
of the Company or an Affiliate, except that when used with respect to a person
granted an Incentive Stock Option means the absence of any interruption or
termination of service as an employee of the Company or an Affiliate. Service
shall not be considered interrupted in the case of sick leave, military leave or
any other leave of absence approved by the Company or in the case of transfers
between payroll locations of the Company or between the Company, its parent, its
subsidiaries or its successor.
"Early Retirement" -- means retirement from employment with or
as a director or advisory director of the Company prior to the Participant
either (i) having reached the age of 55 or (ii) having maintained Continuous
Service for at least three years.
"ERISA" -- means the Employee Retirement Income Security Act of
1974, as amended.
"Incentive Stock Option" -- means an option to purchase Shares
granted by the Committee which is intended to qualify as an Incentive Stock
Option under Section 422 of the Code. Unless otherwise set forth in the Award
Agreement, any Option which does not qualify as an Incentive Stock Option for
any reason shall be deemed a Non-Qualified Stock Option.
"Market Value" -- means the closing high bid with respect to a
Share on the date in question on the Nasdaq Stock Market, or any similar system
then in use, or, if the Shares are not then traded on the Nasdaq Stock Market or
any similar system, the closing sales price on such date (or, if there is no
reported sale on such date, on the last preceding date on which any reported
sale occurred) of a Share on the Composite Tape for New York Stock
Exchange-Listed Stocks, or, if on such date the Shares are not quoted on the
Composite Tape, on the New York Stock
1
<PAGE> 2
Exchange, or if the Shares are not listed or admitted to trading on such
Exchange, on the principal United States securities exchange registered under
the Securities Exchange Act of 1934 (the "Exchange Act") on which the Shares are
listed or admitted to trading, or, if the Shares are not listed or admitted to
trading on any such exchange, the fair market value on such date of a Share as
the Committee shall determine.
"Non-Qualified Stock Option" -- means an option to purchase
Shares granted by the Committee which does not qualify, for any reason, as an
Incentive Stock Option under Section 422 of the Code.
"Normal Retirement" -- means retirement from employment with or
as a director or advisory director of the Company after the Participant has (i)
reached the age of 65 and (ii) maintained Continuous Service for at least three
years.
"Option" -- means an Incentive Stock Option or a Non-Qualified
Stock Option.
"Participant" -- means any director, advisory director, officer
or employee of the Company or any Affiliate who is selected by the Committee to
receive an Award.
"Plan" -- means this 1997 Omnibus Incentive Plan of the
Company.
"Performance Award" -- means an Award granted pursuant to
Section 5(d) herein.
"Related" -- means (i) in the case of a Stock Appreciation
Right, a Stock Appreciation Right which is granted in connection with, and to
the extent exercisable, in whole or in part, in lieu of, an Option or another
Stock Appreciation Right and (ii) in the case of an Option, an Option with
respect to which and to the extent a Stock Appreciation Right is exercisable, in
whole or in part, in lieu thereof.
"Restricted Stock" -- means Shares awarded to a Participant by
the Committee pursuant to Section 5(c) hereof.
"Shares" -- means the shares of common stock of the Company.
"Stock Appreciation Right" -- means a stock appreciation right
with respect to Shares granted by the Committee pursuant to the Plan.
"Ten Percent Holder" -- means any individual who owns stock
possessing more than ten percent of the total combined voting power of all
classes of stock of the Company and any Affiliate.
3. ADMINISTRATION. The Plan shall be administered by a Committee
consisting of two or more members of the Board of Directors of the Company, each
of whom (i) shall be an outside director as defined under Section 162(m) of the
Code and the regulations thereunder and (ii) shall be a Non-Employee Director as
defined under Rule 16(b) of the Securities Exchange Act of 1934 or any similar
or successor provision. The members of the Committee shall be appointed by the
Board of Directors of the Company. Except as limited by the express provisions
of the Plan or by resolutions adopted by the Board of Directors of the Company,
the Committee shall have sole and complete authority and discretion to (i)
select Participants and grant Awards; (ii) determine the number of Shares to be
subject to types of Awards generally, as well as to individual Awards granted
under the Plan; (iii) determine the terms and conditions upon which Awards shall
be granted under the Plan; (iv) prescribe the form and terms of instruments
evidencing such grants; and (v) establish from time to time regulations for the
administration of the Plan, interpret the Plan, and make all determinations
deemed necessary or advisable for the administration of the Plan.
A majority of the Committee shall constitute a quorum, and the acts of
a majority of the members present at any meeting at which a quorum is present,
or acts approved in writing by a majority of the Committee without a meeting,
shall be acts of the Committee.
4. SHARES SUBJECT TO PLAN.
2
<PAGE> 3
(a) Subject to adjustment by the operation of Section 7, the maximum
number of Shares with respect to which Awards may be made under the Plan is
438,011 Shares. The Shares with respect to which Awards may be made under the
Plan may be either authorized and unissued shares or previously issued shares
reacquired and held as treasury shares. Shares which are subject to Related
Stock Appreciation Rights and Related Options shall be counted only once in
determining whether the maximum number of Shares with respect to which Awards
may be granted under the Plan has been exceeded. An Award shall not be
considered to have been made under the Plan with respect to any Option or Stock
Appreciation Right which terminates or with respect to Restricted Stock which is
forfeited, and new Awards may be granted under the Plan with respect to the
number of Shares as to which such termination or forfeiture has occurred.
(b) During any calendar year, no Participant may be granted Awards
under the Plan with respect to more than 50,000 Shares, subject to adjustment as
provided in Section 7.
5. AWARDS.
(a) Options. The Committee is hereby authorized to grant Options to
Participants with the following terms and conditions and with such additional
terms and conditions not inconsistent with the provisions of the Plan as the
Committee shall determine, including the granting of Options in tandem with
other Awards under the Plan:
(i) Exercise Price. The exercise price per Share for an
Option shall be determined by the Committee; provided that, in the case of an
Incentive Stock Option, the exercise price thereof shall not be less than 100%
of the Market Value of a Share on the date of grant of such Option; provided
further that, in the case of an Incentive Stock Option granted to a Ten Percent
Holder, the exercise price thereof shall not be less than 110% of the Market
Value of a Share on the date of grant of such Option.
(ii) Option Term. The term of each Option shall be fixed by
the Committee, but shall be no greater than 15 years; provided that, in the case
of an Incentive Stock Option, the term of such Option shall not exceed ten
years; provided further that, in the case of an Incentive Stock Option granted
to a Ten Percent Holder, the term of such option shall not exceed five years.
(iii) Time and Method of Exercise. Except as provided in
paragraph (a) of Section 6, no Option granted hereunder may be exercised unless
at the time the Participant exercises such Option, such Participant has
maintained Continuous Service since the date of grant of such Option. To
exercise an Option under the Plan, the Participant to whom such Option was
granted shall give written notice to the Company in form satisfactory to the
Committee (and, if partial exercises have been permitted by the Committee, by
specifying the number of Shares with respect to which such Participant elects to
exercise such Option) together with full payment of the exercise price, if any
and to the extent notice is received by the Company. Payment, if any is
required, shall be made either (i) in cash (including check, bank draft or money
order) or (ii) by delivering (A) Shares already owned by the Participant and
having a fair market value equal to the applicable exercise price, such fair
market value to be determined in such appropriate manner as may be provided by
the Committee or as may be required in order to comply with or to conform to
requirements of any applicable laws or regulations, or (B) a combination of cash
and such Shares.
(iv) Option Agreements. At the time of an Award of an
Option, the Participant shall enter into an Award Agreement with the Company in
a form specified by the Committee, agreeing to the terms and conditions of the
Award and such other matters as the Committee shall in its sole discretion
determine.
(v) Limitations on Value of Exercisable Incentive Stock
Options. The aggregate Market Value of the Shares with respect to which
Incentive Stock Options are exercisable for the first time by a Participant in
any calendar year shall not exceed $100,000.
3
<PAGE> 4
(vi) Eligible Recipients of Incentive Stock Options.
Incentive Stock Options may be granted by the Committee only to officers or
employees of the Company or its Affiliates.
(b) Stock Appreciation Rights. The Committee is hereby authorized to
grant Stock Appreciation Rights to Participants with the following terms and
conditions and with such additional terms and conditions not inconsistent with
the provisions of the Plan as the Committee shall determine:
(i) General. A Stock Appreciation Right shall, upon its
exercise, entitle the Participant to whom such Stock Appreciation Right was
granted to receive a number of Shares or cash or combination thereof, as the
Committee in its discretion shall determine, the aggregate value of which (i.e.,
the sum of the amount of cash and/or Market Value of such Shares on date of
exercise) shall equal (as nearly as possible, it being understood that the
Company shall not issue any fractional shares) the amount by which the Market
Value per Share on the date of such exercise shall exceed the exercise price of
such Stock Appreciation Right, multiplied by the number of Shares with respect
to which such Stock Appreciation Right shall have been exercised.
(ii) Related Options. A Stock Appreciation Right may be
Related to an Option or may be granted independently of any Option as the
Committee shall from time to time in each case determine. In the case of a
Related Option, such Related Option shall cease to be exercisable to the extent
of the Shares with respect to which the Related Stock Appreciation Right was
exercised. Upon the exercise or termination of a Related Option, any Related
Stock Appreciation Right shall terminate to the extent of the Shares with
respect to which the Related Option was exercised or terminated. If the Related
Option is an Incentive Stock Option, the Related Option shall satisfy all
restrictions and the limitations imposed on Incentive Stock Options under
paragraph (a) of this Section 5 (including, without limitation, restrictions on
exercise price and term).
(iii) Exercise Price and Term. The exercise price and term
of each Stock Appreciation Right shall be fixed by the Committee; provided that,
that the term of a Stock Appreciation Right shall not exceed 15 years.
(iv) Stock Appreciation Right Agreements. At the time of an
Award of a Stock Appreciation Right, the Participant shall enter into an Award
Agreement with the Company in a form specified by the Committee, agreeing to the
terms and conditions of the Award and such other matters as the Committee shall
in its sole discretion determine.
(v) Time and Method of Exercise. Except as provided in
paragraph (a) of Section 6, no Stock Appreciation Right may be exercised unless
at the time the Participant exercises such Stock Appreciation Right, such
Participant has maintained Continuous Service since the date of grant of such
Stock Appreciation Right. To exercise a Stock Appreciation Right under the Plan,
the Participant to whom such Stock Appreciation Right was granted shall give
written notice to the Company in form satisfactory to the Committee (and, if
partial exercises have been permitted by the Committee, by specifying the number
of Shares with respect to which such Participant elects to exercise such Stock
Appreciation Right) together with full payment of the exercise price, if any and
to the extent required. The date of exercise shall be the date on which such
notice is received by the Company. Payment, if any is required, shall be made
either (i) in cash (including check, bank draft or money order) or (ii) by
delivering (A) Shares already owned by the Participant and having a fair market
value equal to the applicable exercise price, such fair market value to be
determined in such appropriate manner as may be provided by the Committee or as
may be required in order to comply with or to conform to requirements of any
applicable laws or regulations, or (B) a combination of cash and such Shares.
(c) Restricted Stock. The Committee is hereby authorized to
grant Awards of Restricted Stock to Participants with the following terms and
conditions and with such additional terms and conditions not inconsistent with
the provisions of the Plan as the Committee shall determine:
4
<PAGE> 5
(i) Restrictions. Shares of Restricted Stock shall be
subject to such restrictions as the Committee may impose (including, without
limitation, any limitation on the right to vote a Share of Restricted Stock or
the right to receive any dividend or other right or property with respect
thereto), which restrictions may lapse separately or in combination at such time
or times, in such installments or otherwise as the Committee may deem
appropriate. During the period of time in which the Shares awarded as Restricted
Stock are subject to the restrictions contemplated herein (a "Restricted
Period"), unless otherwise permitted by the Plan or by the Committee as provided
in the applicable Award Agreement, such Shares may not be sold, assigned,
transferred, pledged or otherwise encumbered by the Participant. Except for the
restrictions which may be imposed on Restricted Stock, a Participant to whom
Shares of Restricted Stock have been awarded shall have all the rights of a
stockholder, including but not limited to the right to receive all dividends
paid on such Shares and the right to vote such Shares.
(ii) Restricted Stock Agreements. At the time of an Award of
Shares of Restricted Stock, the Participant shall enter into an Award Agreement
with the Company in a form specified by the Committee, agreeing to the terms and
conditions of the Award and such other matters as the Committee shall in its
sole discretion determine.
(iii) Stock Certificates. Any Restricted Stock granted under
the Plan shall be evidenced by issuance of a stock certificate or certificates,
which certificate or certificates shall be held by the Company. Such certificate
or certificates shall be registered in the name of the Participant and shall
bear the following (or similar) legend:
"The transferability of this certificate and the shares of
stock represented hereby are subject to the terms and
conditions (including forfeiture) contained in the 1997
Omnibus Incentive Plan of FirstFederal Financial Services
Corp and an Agreement entered into between the registered
owner and FirstFederal Financial Services Corp. Copies of
such Plan and Agreement are on file in the offices of the
Secretary of FirstFederal Financial Services Corp, 135 East
Liberty Street, Wooster, Ohio 44691."
(iv) Removal of Restrictions. Shares representing Restricted
Stock that are no longer subject to restrictions shall be delivered to the
holder thereof promptly after the applicable restrictions lapse or are waived.
(d) Performance Awards. The Committee is hereby authorized to grant
Performance Awards to Participants subject to the terms of the Plan and the
applicable Award Agreement. At the time of grant of a Performance Award, the
Participant shall enter into an Award Agreement with the Company in a form
specified by the Committee, agreeing to the terms and conditions of the
Performance Award and such other matters as the Committee shall in its sole
discretion determine. A Performance Award granted under the Plan (i) may be
denominated or payable in cash, Shares (including, without limitation,
Restricted Stock), other securities, other Awards or other property and (ii)
shall confer on the holder thereof the right to receive payments, in whole or in
part, upon the achievement of such performance goals during such performance
periods as the Committee shall establish. Subject to the terms of the Plan, the
performance goals to be achieved during any performance period, the length of
any performance period, the amount of any Performance Award granted and the
amount of any payment or transfer to be made pursuant to any Performance Award
shall be determined by the Committee as provided in the applicable Award
Agreement. The term of a Performance Award shall not exceed 15 years.
6. TERMINATION OF SERVICE.
(a) Options and Stock Appreciation Rights.
(i) If a Participant to whom an Option or Stock Appreciation
Right was granted shall cease to maintain Continuous Service for any reason
(including total and partial disability and Early Retirement, but excluding
Normal Retirement, death and termination of employment by the Company or any
Affiliate for Cause), such Participant may, but only within the period of three
5
<PAGE> 6
months, in the case of an Incentive Stock Option, or one
year, in the case of a Non-Qualified Stock Option or Stock
Appreciation Right, immediately succeeding such cessation of
Continuous Service and in no event after the expiration date
of such Option or Stock Appreciation Right, exercise such
Option or Stock Appreciation Right to the extent that such
Participant was entitled to exercise such Option or Stock
Appreciation Right at the date of such cessation of
Continuous Service. If the Continuous Service of a
Participant to whom an Option or Stock Appreciation Right
was granted by the Company is terminated for Cause, all
rights under any Option or Stock Appreciation Right of such
Participant shall expire immediately upon the giving to the
Participant of notice of such termination.
(ii) If a Participant to whom an Option
or Stock Appreciation Right was granted shall cease to
maintain Continuous Service due to Normal Retirement, such
Participant may, but only within the period of three months,
in the case of an Incentive Stock Option, or two years, in
the case of a Non-Qualified Stock Option or Stock
Appreciation Right, immediately succeeding such cessation of
Continuous Service and in no event after the expiration date
of such Option or Stock Appreciation Right, exercise such
Option or Stock Appreciation Right to the extent that such
Participant was entitled to exercise such Option or Stock
Appreciation Right at the date of such cessation of
Continuous Service.
(iii) In the event of the death of a
Participant while in the Continuous Service of the Company
or an Affiliate or within the periods referred to in
paragraphs (a)(i) and (a)(ii) of this Section 6, the person
to whom any Option or Stock Appreciation Right held by the
Participant at the time of his or her death is transferred
by will or the laws of descent and distribution or in the
case of an Award other than an Incentive Stock Option,
pursuant to a qualified domestic relations order, as defined
in the Code or Title I of ERISA or the rules thereunder, or
as otherwise permitted to be transferred under Section 10 of
the Plan may, but only within the period of two years
immediately succeeding the date of death of such
Participant, and in no event after the expiration date of
such Option or Stock Appreciation Right, exercise such
Option or Stock Appreciation Right to the extent that such
Participant was entitled to exercise such Option or Stock
Appreciation Right immediately prior to his death. Following
the death of any Participant to whom an Option was granted
under the Plan, irrespective of whether any Related Stock
Appreciation Right shall have theretofore been granted to
the Participant or whether the person entitled to exercise
such Related Stock Appreciation Right desires to do so, the
Committee may, as an alternative means of settlement of such
Option, elect to pay to the person to whom such Option is
transferred as permitted by Section 10 of this Plan, the
amount by which the Market Value per Share on the date of
exercise of such Option shall exceed the exercise price of
such Option, multiplied by the number of Shares with respect
to which such Option is properly exercised. Any such
settlement of an Option shall be considered an exercise of
such Option for all purposes of the Plan.
(iv) Notwithstanding the provisions of
subparagraphs (i) through (iii) above, the Committee may, in
its sole discretion, establish different terms and
conditions pertaining to the effect of termination to the
extent permitted by applicable federal and state law.
(b) Restricted Stock. Except as otherwise provided in
this Plan, if a Participant ceases to maintain Continuous Services
for any reason (other than death, total or partial disability or
Normal or Early Retirement) unless the Committee, in its sole
discretion, shall otherwise determine, all shares of Restricted
Stock theretofore awarded to such Participant and which at the time
of such termination of Continuous Service are subject to the
restrictions imposed by paragraph (c)(i) of Section 5 shall upon
such termination of Continuous Service be forfeited and returned to
the Company. Unless the Committee, in its sole discretion, shall
otherwise determine, if a Participant ceases to maintain Continuous
Service by reason of death, total or partial disability or Normal or
Early Retirement, all shares of Restricted Stock theretofore awarded
to such Participant and which at the time of such termination of
Continuous Service are subject to the restrictions imposed by
paragraph (c)(i) of Section 5 shall upon such termination of
Continuous Service be free of restrictions and shall not be
forfeited.
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(c) Performance Awards. In the event that a Participant to
whom a Performance Award has been granted shall cease to maintain Continuous
Service for any reason, the rights of such Participant or any person to whom the
Award may have been transferred as permitted by Section 10 shall be governed by
the terms of the Plan and the applicable Award Agreement.
7. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. In the event of any
change in the outstanding Shares subsequent to the effective date of the Plan by
reason of any reorganization, recapitalization, stock split, stock dividend,
combination or exchange of shares, merger, consolidation or any change in the
corporate structure or Shares of the Company, the maximum aggregate number and
class of shares and exercise price of the Award, if any, as to which Awards may
be granted under the Plan and the number and class of shares and exercise price
of the Award, if any, with respect to which Awards have been granted under the
Plan shall be appropriately adjusted by the Committee, whose determination shall
be conclusive. Any Award which is adjusted as a result of this Section 7 shall
be subject to the same restrictions as the original Award.
8. EFFECT OF MERGER ON OPTIONS AND STOCK APPRECIATION RIGHTS. In the
case of any merger, consolidation or combination of the Company (other than a
merger, consolidation or combination in which the Company is the continuing
corporation and which does not result in the outstanding Shares being converted
into or exchanged for different securities, cash or other property, or any
combination thereof), any Participant to whom an Option or Stock Appreciation
Right has been granted shall have the additional right (subject to the
provisions of the Plan and any limitation applicable to such Option or Stock
Appreciation Right), thereafter and during the term of each such Option or Stock
Appreciation Right, to receive upon exercise of any such Option or Stock
Appreciation Right an amount equal to the excess of the fair market value on the
date of such exercise of the securities, cash or other property, or combination
thereof, receivable upon such merger, consolidation or combination in respect of
a Share over the exercise price of such Stock Appreciation Right or Option,
multiplied by the number of Shares with respect to which such Option or Stock
Appreciation Right shall have been exercised. Such amount may be payable fully
in cash, fully in one or more of the kind or kinds of property payable in such
merger, consolidation or combination, or partly in cash and partly in one or
more of such kind or kinds of property, all in the discretion of the
Participant.
9. EFFECT OF CHANGE IN CONTROL. Each of the events specified in the
following clauses (i) through (iii) of this Section 9 shall be deemed a "change
of control": (i) any third person, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, shall become the beneficial
owner of shares of the Company with respect to which 25% or more of the total
number of votes for the election of the Board of Directors of the Company may be
cast, (ii) as a result of, or in connection with, any cash tender offer, merger
or other business combination, sale of assets or contested election, or
combination of the foregoing, the persons who were directors of the Company
shall cease to constitute a majority of the Board of Directors of the Company,
or (iii) the stockholders of the Company shall approve an agreement providing
either for a transaction in which the Company will cease to be an independent
publicly-owned corporation or for a sale or other disposition of all or
substantially all the assets of the Company. Upon a change in control, unless
the Committee shall have otherwise provided in the applicable Award Agreement,
any restrictions or vesting period with respect to any outstanding Awards shall
lapse and all such Awards shall become fully vested in the Participant to whom
such Awards were awarded; provided, however, that no Award which has previously
been exercised or otherwise terminated shall become exercisable.
10. ASSIGNMENTS AND TRANSFERS. No Award granted under the Plan shall be
transferable otherwise than by will or the laws of descent and distribution,
except that an Award other than an Incentive Stock Option may be transferred
pursuant to a qualified domestic relations order or by gift to any member of the
Participant's immediate family or to a trust for the benefit of one or more of
such immediate family members. During the lifetime of an Award recipient, an
Award shall be exercisable only by the Award recipient unless it has been
transferred as permitted hereby, in which case it shall be exercisable only by
such transferee. For the purpose of this Section 10 a Participant's "immediate
family" shall mean the Participant's spouse, children and grandchildren.
11. EMPLOYEE RIGHTS UNDER THE PLAN. No person shall have a right to be
selected as a Participant nor, having been so selected, to be selected again as
a Participant and no officer, employee or other person shall have any claim or
right to be granted an Award under the Plan or under any other incentive or
similar plan of the Company or any Affiliate. Neither the Plan nor any action
taken thereunder shall be construed as giving any employee any right to be
retained in the employ of or serve as a director or advisory director of the
Company or any Affiliate.
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12. DELIVERY AND REGISTRATION OF STOCK. The Company's obligation to
deliver Shares with respect to an Award shall, if the Committee so requests, be
conditioned upon the receipt of a representation as to the investment intention
of the Participant to whom such Shares are to be delivered, in such form as the
Committee shall determine to be necessary or advisable to comply with the
provisions of the Securities Act of 1933 or any other federal, state or local
securities legislation. It may be provided that any representation requirement
shall become inoperative upon a registration of the Shares or other action
eliminating the necessity of such representation under such Securities Act or
other securities legislation. The Company shall not be required to deliver any
Shares under the Plan prior to (i) the admission of such Shares to listing on
any stock exchange on which Shares may then be listed, and (ii) the completion
of such registration or other qualification of such Shares under any state or
federal law, rule or regulation, as the committee shall determine to be
necessary or advisable.
13. WITHHOLDING TAX. Upon the termination of the restricted period with
respect to any shares of Restricted Stock (or at any such earlier time, if any,
that an election is made by the Participant under Section 83(b) of the Code, or
any successor provision thereto, to include the value of such shares in taxable
income), the Company shall have the right to require the Participant or other
person receiving such shares to pay the Company the amount of any taxes which
the Company is required to withhold with respect to such shares, or, in lieu
thereof, to retain or sell without notice, a sufficient number of shares held by
it to cover the amount required to be withheld. The Company shall have the right
to deduct from all dividends paid with respect to shares of Restricted Stock the
amount of any taxes which the Company is required to withhold with respect to
such dividend payments.
The Company shall have the right to deduct from all amounts paid in
cash with respect to the exercise of a Stock Appreciation Right under the Plan
any taxes required by law to be withheld with respect to such cash payments.
Where a Participant or other person is entitled to receive Shares pursuant to
the exercise of an Option or Stock Appreciation Right pursuant to the Plan, the
Company shall have the right to require the Participant or such other person to
pay the Company the amount of any taxes which the Company is required to
withhold with respect to such Shares, or, in lieu thereof, to retain, or sell
without notice, a number of such Shares sufficient to cover the amount required
to be withheld.
All withholding decisions pursuant to this Section 13 shall be at the
sole discretion of the Committee or the Company.
14. AMENDMENT OR TERMINATION.
(a) Subject to paragraph (b) of this Section 14, the Board of
Directors of the Company may amend, alter, suspend, discontinue, or terminate
the Plan without the consent of shareholders or Participants, except that any
such action will be subject to the approval of the Company's shareholders if,
when and to the extent such shareholder approval is necessary or required for
purposes of any applicable federal or state law or regulation or the rules of
any stock exchange or automated quotation system on which the Shares may then be
listed or quoted, or if the Board of Directors of the Company, in its
discretion, determines to seek such shareholder approval.
(b) Except as otherwise provided herein, the Committee may waive
any conditions of or rights of the Company or modify or amend the terms of any
outstanding Award. The Committee may not, however, amend, alter, suspend,
discontinue or terminate any outstanding Award without the consent of the
Participant or holder thereof, except as otherwise herein provided.
15. EFFECTIVE DATE AND TERM OF PLAN. The plan shall become effective
upon its adoption by the Board of Directors of the Company, subject to the
approval of the Plan by the shareholders of the Company. It shall continue in
effect for a term of 15 years unless sooner terminated under Section 14 hereof.
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<PAGE> 1
Exhibit 4.5
FIRST SHENANGO BANCORP, INC.
1993 STOCK OPTION PLAN
1. PURPOSE OF THE PLAN. The Plan shall be known as the First Shenango
Bancorp, Inc., ("Corporation") 1993 Stock Option Plan (the "Plan"). The purpose
of the Plan is to attract and retain the best available personnel for positions
of substantial responsibility and to provide additional incentive to officers,
directors and key employees of the Corporation, or any present or future parent
or subsidiary of the Corporation to promote the success of the business. The
Plan is intended to provide for the grant of "Incentive Stock Options," within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code") and non-Incentive Stock Options, options that do not so qualify. Each
and every one of the provisions of the Plan relating to Incentive Stock Options
shall be interpreted to conform to the requirements of Section 422 of the Code.
2. DEFINITIONS. As used herein, the following definitions shall apply.
(a) "Association" shall mean First Federal Savings and Loan Association
of New Castle, or any successor corporation thereto.
(b) "Award" means the grant by the Committee of an Incentive Stock
Option or a Non- Incentive Stock Option, or any combination thereof, as provided
in the Plan.
(c) "Board" shall mean the Board of Directors of the Corporation, or
any successor or parent corporation thereto.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(e) "Committee" shall mean the Stock Option Committee appointed by the
Board in accordance with paragraph 5(a) of the Plan.
(f) "Common Stock" shall mean common stock, par value $.10 per share,
of the Corporation, or any successor or parent corporation thereto.
(g) "Continuous Employment" or "Continuous Status as an Employee" shall
mean the absence of any interruption or termination of employment with the
Corporation or any present or future Parent or Subsidiary of the Corporation.
Employment shall not be considered interrupted in the case of sick leave,
military leave or any other leave of absence approved by the Corporation or in
the case of transfers between payroll locations, of the Corporation or between
the Corporation, its Parent, its Subsidiaries or a successor.
(h) "Corporation" shall mean the First Shebang Bancorp, Inc., the
parent corporation for the Association, or any successor or Parent thereof.
(i) "Director" shall mean a member of the Board of the Corporation or
any successor or parent corporation thereto.
(j) "Effective Date" shall mean the date specified in Section 15
hereof.
(k) "Employee" shall mean any person employed by the Corporation or any
present or future Parent or Subsidiary of the Corporation.
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(l) "Incentive Stock Option" or "ISO" shall mean an option to purchase
Shares granted by the Committee pursuant to Section 8 hereof which is subject to
the limitations and restrictions of Section 8 hereof and is intended to qualify
under Section 422 of the Code.
(m) "Non-Incentive Stock Option" or "Non-ISO" shall mean an option to
purchase Shares granted pursuant to Section 9 hereof, which option is NOT
intended to qualify under Section 422 of the Code.
(n) "Option" shall mean an Incentive or Non-Incentive Stock Option
granted pursuant to this Plan providing the holder of such Option with the right
to purchase Common Stock.
(o) "Optioned Stock" shall mean stock subject to an Option granted
pursuant to the Plan.
(p) "Optionee" shall mean any person who receives an Option or Award
pursuant to the Plan.
(q) "Parent" shall mean any present or future corporation which would
be a "parent corporation" as defined in Subsections 424(c) and (g) of the Code.
(r) "Participant" means any director, officer or key employee of the
Corporation or any Parent or Subsidiary of the Corporation or any other person
providing a service to the Corporation who is selected by the Committee to
receive an Award, or who by the express terms of the Plan is granted an Award.
(s) "Plan" shall mean the First Shebang Bancorp, Inc., Stock Option
Plan.
(t) "Share" shall mean one share of the Common Stock.
(u) "Subsidiary" shall mean any present or future corporation which
would be a "subsidiary corporation" as defined in Subsections 424(f) and (g) of
the Code.
3. SHARES SUBJECT TO THE PLAN. Except as otherwise required by the
provisions of Section 13 hereof, the aggregate number of Shares with respect to
which Awards may be made pursuant to the Plan shall not exceed 224,825(1). Such
Shares may either be authorized but unissued shares or treasury shares.
An Award shall not be considered to be made under the Plan with respect to
any Option which terminates prior to its exercise, and new Awards may be granted
under the Plan with respect to the number of Shares as to which such termination
has occurred.
4. SIX MONTH HOLDING PERIOD.
A total of six months must elapse between the date of the grant of an
Option and the date of the sale of Common Stock received through the exercise of
an Option.
5. ADMINISTRATION OF THE PLAN.
(a) (i) COMPOSITION OF THE COMMITTEE. Except as indicated in paragraph
5(a)(ii) below, the Plan shall be administered by the Committee consisting of at
least three non-employee Directors of the Corporation appointed by the Board and
serving at the pleasure of the Board. Officers, Directors, key employers and
other persons who are designated by the Committee shall be eligible to receive
Awards under the Plan, and all persons designated as members of the Committee
shall be "disinterested persons" within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934.
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(1) Equal to 10% of the 2,248,250 shares
issued in the initial stock offering.
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<PAGE> 3
(ii) For the purpose of granting Awards to directors, the
selection of any Director to whom Awards may be granted, as well as the number
of Shares subject to Awards, must be determined by a "disinterested committee",
as defined in Rule 16b-3 under the Securities Exchange Act of 1934.
(b) POWERS OF THE COMMITTEE. The Committee is authorized (but only
to the extent not contrary to the express provisions of the Plan or to
resolutions adopted by the Board) to interpret the Plan, to prescribe, amend and
rescind rules and regulations relating to the Plan, to determine the form and
content of Awards to be issued under the Plan and to make other determinations
necessary or advisable for the administration of the Plan, and shall have and
may exercise such other power and authority as may be delegated to it by the
Board from time to time. A majority of the entire Committee shall constitute a
quorum and the action of a majority of the members present at any meeting at
which a quorum is present shall be deemed the action of the Committee. In no
event may the Committee revoke outstanding Awards without the consent of the
Participant.
The Chairman of the Corporation and such other officers as shall be
designated by the Committee are hereby authorized to execute instruments
evidencing Awards on behalf of the Corporation and to cause them to be delivered
to the Participants.
(c) EFFECT OF COMMITTEE'S DECISION. All decisions, determinations
and interpretations of the Committee shall be final and conclusive on all
persons affected thereby.
6. ELIGIBILITY.
(i) Awards may be granted to officers, Directors, key
employees and other persons. The Committee shall from time to time determine the
officers, Directors, key employees and other persons who shall be granted Awards
under the Plan, the number to be granted to each such officer, Director, key
employee and other persons under the Plan, and whether Awards granted to each
such Participant under the Plan shall be Incentive and/or Non-Incentive Stock
Options. In selecting Participants and in determining the number of Shares of
Common Stock to be granted to each such Participant pursuant to each Award
granted under the Plan, the Committee may consider the nature of the services
rendered by each such Participant, each such Participant's current and potential
contribution to the Corporation and such other factors as the Committee may, in
its sole discretion, deem relevant. Officers, Directors, key employees or other
persons who have been granted an Award may, if otherwise eligible, be granted
additional Awards.
(ii) The aggregate fair market value (determined as of the
date the Option is granted) of the Shares with respect to which Incentive Stock
Options are exercisable for the first time by each Employee during any calendar
year (under all Incentive Stock Option plans, as defined in Section 422 of the
Code, of the Corporation or any present or future Parent or Subsidiary of the
Corporation) shall not exceed $100,000. Notwithstanding the prior provisions of
this Section 6, the Committee may grant Options in excess of the foregoing
limitations, provided said Options shall be clearly and specifically designated
as not being Incentive Stock Options, as defined in Section 422 of the Code.
(iii) In no event shall Shares subject to Options granted to
non-employee Directors in the aggregate under this Plan exceed more than 40%
(89,930 shares) of the total number of Shares authorized for delivery under this
Plan pursuant to Section 3 herein.
7. TERM OF THE PLAN. The Plan shall continue in effect for a term of ten
(10) years from the Effective Date, unless sooner terminated pursuant to Section
18 hereof. No option shall be granted under the Plan after ten (10) years from
the Effective Date.
8. TERMS AND CONDITIONS OF INCENTIVE STOCK OPTIONS. Incentive Stock
Options may be granted only to Participants who are Employees. Each Incentive
Stock Option granted pursuant to the Plan shall be
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<PAGE> 4
evidenced by an instrument in such form as the Committee shall from time to time
approve. Each and every Incentive Stock Option granted pursuant to the Plan
shall comply with, and be subject to, the following terms and conditions:
(a) OPTION PRICE.
(i) The price per Share at which each Incentive Stock Option
granted under the Plan may be exercised shall not, as to any particular
Incentive Stock Option, be less than the fair market value of the Common Stock
at the time such Incentive Stock Option is granted. For such purposes, if the
Common Stock is traded otherwise than on a national securities exchange at the
time of the granting of an Option, then the price per Share of the Optioned
Stock shall be not less than the mean between the bid and asked price on the
date the Incentive Stock Option is granted or, if there is no bid and asked
price on said date, then on the next prior business day on which there was a bid
and asked price. If no such bid and asked price is available, then the price per
Share shall be determined by the Committee. If the Common Stock is listed on a
national securities exchange at the time of the granting of an Incentive Stock
Option, then the price per Share shall be not less than the average of the
highest and lowest selling price on such exchange on the date such Incentive
Stock Option is granted or, if there were no sales on said date, then the price
shall be not less than the mean between the bid and asked price on such date.
(ii) In the case of an Employee who owns Common Stock
representing more than ten percent (10%) of the outstanding Common Stock at the
time the Incentive Stock Option is granted, the Incentive Stock Option price
shall not be less than one hundred and ten percent (110%) of the fair market
value of the Common Stock at the time the Incentive Stock Option is granted.
(b) PAYMENT. Full payment for each Share of Common Stock purchased
upon the exercise of any Incentive Stock Option granted under the Plan shall be
made at the time of exercise of each such Incentive Stock Option and shall be
paid in cash (in United States Dollars), Common Stock or a combination of cash
and Common Stock. Common Stock utilized in full or partial payment of the
exercise price shall be valued at its fair market value at the date of exercise.
The Corporation shall accept full or partial payment in Common Stock only to the
extent permitted by applicable law. No Shares of Common Stock shall be issued
until full payment therefor has been received by the Corporation, and no
Optionee shall have any of the rights of a stockholder of the Corporation until
Shares of Common Stock are issued to him.
(c) TERM OF INCENTIVE STOCK OPTION. The term of each incentive Stock
Option granted pursuant to the Plan shall be not more than ten (10) years from
the date each such Incentive Stock Option is granted, provided that in the case
of an Employee who owns stock representing more than ten percent (10%) of the
Common Stock outstanding at the time the Incentive Stock Option is granted, the
term of the Incentive Stock Option shall not exceed five (5) years.
(d) EXERCISE GENERALLY. Except as otherwise provided in Section 10
hereof, no Incentive Stock Option may be exercised unless the Optionee shall
have been in the employ of the Corporation at all times during the period
beginning with the date of grant of any such Incentive Stock Option and ending
on the date three (3) months prior to the date of exercise of any such Incentive
Stock Option. The Committee may impose additional conditions upon the right of
an Optionee to exercise any Incentive Stock Option granted hereunder which are
not inconsistent with the terms of the Plan or the requirements for
qualification as an Incentive Stock Option under Section 422 of the Code.
(e) CASHLESS EXERCISE. An Optionee who has held an Incentive Stock
Option for at least six months may engage in the "cashless exercise" of the
Option. In a cashless exercise, an Optionee gives the Corporation written notice
of the exercise of the Option together with an order to a registered
broker-dealer or equivalent third party, to sell part or all of the Optioned
Stock and to deliver enough of the proceeds to the Corporation to pay the Option
price and any applicable withholding taxes. If the Optionee does not sell the
Optioned Stock through a registered broker-dealer or equivalent third party, he
can give the Corporation written notice of the
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<PAGE> 5
exercise of the Option and the third party purchaser of the Optioned Stock shall
pay the Option price plus any applicable withholding taxes to the Corporation.
(f) TRANSFERABILITY. Any Incentive Stock Option granted
pursuant to the Plan shall be exercised during an Optionee's lifetime only by
the Optionee to whom it was granted and shall not be assignable or transferable
otherwise than by will or by the laws of descent and distribution.
9. TERMS AND CONDITIONS OF NON-INCENTIVE STOCK OPTIONS. Each
Non-Incentive Stock Option granted pursuant to the Plan shall be evidenced by an
instrument in such form as the Committee shall from time to time approve. Each
and every Non-Incentive Stock Option granted pursuant to the Plan shall comply
with and be subject to the following terms and conditions.
(a) OPTIONS GRANTED TO DIRECTORS. Subject to the limitations
of Section 6(iii), 12,847(2) Non-Incentive Stock Options will be granted to each
Director who is not an Employee as of the Effective Date at an exercise price
equal to the fair market value of the Common Stock on such date of grant. The
Options shall be exercisable at the rate of 25% of the total granted each year
on the anniversary date of the Effective Date, subject to stockholder
ratification of the Plan and will remain exercisable for up to ten years from
such date of grant; provided however that such options shall be 100% exercisable
in the event the optionee terminates service on the Board as a Director or
Director Emeritus after completing at least ten years of service as such or due
to death, disability or a change in control of the Association or the
Corporation as defined in Section 13(b), herein. The price per Share at which
such Options granted shall be equal to the fair market value of the Common Stock
at the time such Options are granted. For such purposes, if the Common Stock is
traded otherwise than on a national securities exchange at the time of the
granting of the Options, then the price per Share of the Optioned Stock shall be
not less than the mean between the bid and asked price on the date the Options
are granted or, if there is no bid and asked price on said date, then on the
next prior business day on which there was a bid and asked price. If no such bid
and asked price is available, then the price per Share shall be determined by
the Committee. If the Common Stock is listed on a national securities exchange
at the time of the granting of an Option, then the price per Share shall be not
less than the average of the highest and lowest selling price on such exchange
on the date such Options are granted or, if there were no sales on said date,
then the price shall be not less than the mean between the bid and asked price
on such date. Such Options may be exercised only while the Optionee is a
Director or Director Emeritus of the Corporation, or within one year after
termination of the Optionee's status as a Director or Director Emeritus but not
later than the date on which such Options would otherwise expire, or in the
event of such person's death during the term of his directorship, by the
personal representative of his estate or person or persons to whom his rights
under such Option shall have passed by will or by laws of descent and
distribution. Such Options of a deceased Director or Director Emeritus may be
exercised within two years from the date of his death, but not later than the
date on which the Option would otherwise expire. Unless otherwise inapplicable,
or inconsistent with the provisions of this paragraph, the Options to be granted
to Directors hereunder shall be subject to all other provisions of this Plan.
(b) OPTION PRICE. The exercise price per Share of Common Stock
for each Non-Incentive Stock Option granted pursuant to the Plan, other than
Options granted pursuant to Section 9(a) herein, shall be at such price as the
Committee may determine in its sole discretion.
(c) Payment. Full payment for each Share of Common Stock
purchased upon the exercise of any Non-Incentive Stock Option granted under the
Plan shall be made at the time of exercise of each such Non- Incentive Stock
Option and shall be paid in cash (in United States Dollars), Common Stock or a
combination of cash and Common Stock. Common Stock utilized in full or partial
payment of the exercise price shall be valued at its fair market value at the
date of exercise. The Corporation shall accept full or partial payment in Common
Stock only to the extent permitted by applicable law. No Shares of Common Stock
shall be issued until full payment therefore has been received by the
Corporation and no Optionee shall have any of the rights of a stockholder of the
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(2) Equal to 40% of total shares reserved under the plan divided by seven
non-employee directors.
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Corporation until the Shares of Common Stock are issued to him.
(d) TERM. The term of each Non-Incentive Stock Option granted
pursuant to the Plan shall be not more than ten (10) years from the date each
such Non-Incentive Stock Option is granted.
(e) EXERCISE GENERALLY. The Committee may impose additional
conditions upon the right of any Participant to exercise any Non-Incentive Stock
Option granted hereunder which is not inconsistent with the terms of the Plan.
(f) CASHLESS EXERCISE. An Optionee who has held a
Non-Incentive Stock Option for at least six months may engage in the "cashless
exercise" of the Option. In a cashless exercise, an Optionee gives the
Corporation written notice of the exercise of the Option together with an order
to a registered broker-dealer or equivalent third party, to sell part or all of
the Optioned Stock and to deliver enough of the proceeds to the Corporation to
pay the Option price and any applicable withholding taxes. If the Optionee does
not sell the Optioned Stock through a registered broker-dealer or equivalent
third party, he can give the Corporation written notice of the exercise of the
Option and the third party purchaser of the Optioned Stock shall pay the Option
price plus any applicable withholding taxes to the Corporation.
(g) TRANSFERABILITY. Any Non-Incentive Stock Option granted
pursuant to the Plan shall be exercised during an Optionee's lifetime only by
the Optionee to whom it was granted and shall not be assignable or transferable
otherwise than by will or by the laws of descent and distribution.
10. EFFECT OF TERMINATION OF EMPLOYMENT, DISABILITY OR DEATH ON INCENTIVE
STOCK OPTIONS.
(a) TERMINATION OF EMPLOYMENT. In the event that any Optionee's
employment with the Corporation shall terminate for any reason, other than
Permanent and Total Disability (as such term is defined in Section 22(e)(3) of
the Code) or death, all of any such Optionee's Incentive Stock Options, and all
of any such Optionee's rights to purchase or receive Shares of Common Stock
pursuant thereto, shall automatically terminate on the earlier of (1) the
respective expiration dates of any such Incentive Stock Options or (ii) the
expiration of not more than three (3) months after the date of such termination
of employment, but only if, and to the extent that, the Optionee was entitled to
exercise any such Incentive Stock Options at the date of such termination of
employment. In the event that a subsidiary ceases to be a subsidiary of the
Corporation, the employment of all of its employees who are not immediately
thereafter employees of the Corporation shall be deemed to terminate upon the
date such subsidiary so ceases to be a Subsidiary of the Corporation.
(b) DISABILITY. In the event that any Optionee's employment with
the Corporation shall terminate as the result of the Permanent and Total
Disability of such Optionee, such Optionee may exercise any Incentive Stock
Options granted to him pursuant to the Plan at any time prior to the earlier of
(i) the respective expiration dates of any such Incentive Stock Options or (ii)
the date which is one (1) year after the date of such termination of employment,
but only if, and to the extent that, the Optionee was entitled to exercise any
such Incentive Stock Options at the date of such termination of employment.
(c) DEATH. In the event of the death of an Optionee, any
Incentive Stock Options granted to such Optionee may be exercised by the person
or persons to whom the Optionee's rights under any such Incentive Stock Options
pass by will or by the laws of descent and distribution (including the
Optionee's estate during the period of administration) at any time prior to the
earlier of (i) the respective expiration dates of any such Incentive Stock
Options or (ii) the date which is two (2) years after the date of death of such
Optionee but only if, and to the extent that, the Optionee was entitled to
exercise any such Incentive Stock Options at the date of death. For purposes of
this Section 10(c), any Incentive Stock Option held by an Optionee shall be
considered exercisable at the date of his death if the only unsatisfied
condition precedent to the exercisability of such Incentive Stock Option at the
date of death is the passage of a specified period of time. At the discretion of
the Committee, upon exercise of such
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<PAGE> 7
Options the Optionee may receive Shares or cash or combination thereof. If cash
shall be paid in lieu of shares, such cash shall be equal to the difference
between the fair market value of such Shares and the exercise price of such
Options on the exercise date.
(d) INCENTIVE STOCK OPTIONS DEEMED EXERCISABLE. For purposes
of Sections 10(a), 10(b) and 10(c) above, any Incentive Stock Option held by any
Optionee shall be considered exercisable at the date of termination of his
employment if any such Incentive Stock Option would have been exercisable at
such date of termination of employment.
(d) TERMINATION OF INCENTIVE STOCK OPTIONS. To the extent that
any Incentive Stock Option granted under the Plan to any Optionee whose
employment with the Corporation terminates shall not have been exercised within
the applicable period set forth in this Section 10, any such Incentive Stock
Option, and all rights to purchase or receive Shares of Common Stock pursuant
thereto, as the case may be, shall terminate on the last day of the applicable
period.
11. EFFECT OF TERMINATION OF EMPLOYMENT, DISABILITY OR DEATH ON
NON-INCENTIVE STOCK OPTIONS. The terms and conditions of Non-Incentive Stock
Options relating to the effect of the termination of an Optionee's employment,
disability of an Optionee or his death shall be such terms and conditions as the
Committee shall, in its sole discretion, determine at the time of termination,
unless specifically provided for by the terms of the Agreement at the time of
grant of the Award.
12. RIGHT OF REPURCHASE AND RESTRICTIONS ON DISPOSITION. The Committee, in
its sole discretion may include, as a term of any Incentive Stock Option or
Non-Incentive Stock Option, the right (the "Repurchase Right"), but not the
obligation, to repurchase all or any amount of the Shares acquired by an
Optionee pursuant to the exercise of any such Options. The intent of the
Repurchase Right is to encourage the continued employment of the Optionee. The
Repurchase Right shall provide for, among other things, a specified duration of
the Repurchase Right, a specified price per Share to be paid upon the exercise
of the Repurchase Right and a restriction on the disposition of the Shares by
the Optionee during the period of the Repurchase Right. The Repurchase Right may
permit the Corporation to transfer or assign such right to another party. The
Corporation may exercise the Repurchase Right only to the extent permitted by
applicable law.
13. RECAPITALIZATION, MERGER, CONSOLIDATION, CHANGE IN CONTROL AND SIMILAR
TRANSACTIONS.
(a) ADJUSTMENT. Subject to any required action by the
stockholders of the Corporation, within the sole discretion of the Committee,
the aggregate number of Shares of Common Stock for which Options may be granted
hereunder, the number of Shares of Common Stock covered by each outstanding
Option, and the exercise price per Share of Common Stock of each such Option,
shall all be proportionately adjusted for any increase or decrease in the number
of issued and outstanding Shares of Common Stock resulting from a subdivision or
consolidation of Shares (whether by reason of merger, consolidation,
recapitalization, reclassification, split-up, combination of shares, or
otherwise) or the payment of a stock dividend (but only on the Common Stock) or
any other increase or decrease in the number of such Shares of Common Stock
effected without the receipt of consideration by the Corporation (other than
Shares held by dissenting stockholders).
(b) CHANGE IN CONTROL. All outstanding Awards shall become
immediately exercisable in the event of a change in control or imminent change
in control of the Corporation, as determined by the Committee. In the event of
such a change in control or imminent change in control, the Optionee shall, at
the discretion of the Committee, be entitled to receive cash in an amount equal
to the fair market value of the Common Stock subject to any Incentive or
Non-Incentive Stock Option over the Option Price of such Shares, in exchange for
the surrender of such Options by the Optionee on that date in the event of a
change in control or imminent change in control of the Corporation. For purposes
of this Section 13, "change in control" shall mean: (i) the execution of an
agreement for the sale of all, or a material portion, of the assets of the
Corporation; (ii) the execution of an agreement for a merger
7
<PAGE> 8
or recapitalization of the Corporation or any merger or recapitalization whereby
the Corporation is not the surviving entity; (iii) a change of control of the
Corporation, as otherwise defined or determined by the Office of Thrift
Supervision or regulations promulgated by it; or (iv) the acquisition, directly
or indirectly, of the beneficial ownership (within the meaning of that term as
it is used in Section 13(d) of the Securities Exchange Act of 1934 and the rules
and regulations promulgated thereunder) of twenty-five percent (25%) or more of
the outstanding voting securities of the Corporation by any person, trust,
entity or group. This limitation shall not apply to the purchase of shares by
underwriters in connection with a public offering of Corporation stock, or the
purchase of shares of up to 25% of any class of securities of the Corporation by
a tax-qualified employee stock benefit plan which is exempt from the approval
requirements, set forth under 12 C.F.R. ss.574.3(c)(1)(vi) as now in effect or
as may hereafter be amended. The term "person" refers to an individual or a
corporation, partnership, trust, association, joint venture, pool, syndicate,
sole proprietorship, unincorporated organization or any other form of entity not
specifically listed herein. For purposes of this Section 13, "imminent change in
control" shall refer to any offer or announcement, oral or written, by any
person or persons acting as a group, to acquire control of the Corporation. The
decision of the Committee as to whether a change in control or imminent change
in control has occurred shall be conclusive and binding.
(c) EXTRAORDINARY CORPORATE ACTION. Subject to any required action
by the stockholders of the Corporation, in the event of any change in control,
recapitalization, merger, consolidation, exchange of Shares, spin-off,
reorganization, tender offer, liquidation or other extraordinary corporate
action or event, the Committee, in its sole discretion, shall have the power,
prior or subsequent to such action or event to:
(i) appropriately adjust the number of Shares of Common Stock
subject to each Option, the exercise price per Share of Common Stock, and the
consideration to be given or received by the Corporation upon the exercise of
any outstanding Option;
(ii) cancel any or all previously granted Options, provided
that appropriate consideration is paid to the Optionee in connection therewith;
and/or
(iii) make such other adjustments in connection with the Plan
as the Committee, in its sole discretion, deems necessary, desirable,
appropriate or advisable; provided, however, that no action shall be taken by
the Committee which would cause Incentive Stock Options granted pursuant to the
Plan to fail to meet the requirements of Section 422 of the Code.
Except as expressly provided in Sections 13(a) and 13(b) hereof, no
Optionee shall have any rights by reason of the occurrence of any of the events
described in this Section 13.
(d) Acceleration. The Committee shall at all times have the power to
accelerate the exercise date of Options previously granted under the Plan.
14. TIME OF GRANTING OPTIONS. The date of grant of an Option under the
Plan shall, for all purposes, be the date on which the Committee makes the
determination of granting such Option. Except, however, for purposes of
compliance with Section 16 of the Securities Exchange Act of 1934, the date of
grant of an Option shall be deemed the later of the date of grant or the date of
stockholder approval of the Plan. Notice of the determination of the grant of an
Option shall be given to each individual to whom an Option is so granted within
a reasonable time after the date of such grant in a form determined by the
Committee.
15. EFFECTIVE DATE. The Plan shall become effective upon the effective
date of the Federal stock charter of the Association and simultaneous
acquisition of all of the stock of the Association by Corporation. Options may
be granted prior to ratification of the Plan by the stockholders if the exercise
of such Options is subject to such stockholder ratification.
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<PAGE> 9
16. APPROVAL BY STOCKHOLDERS. The Plan shall be approved by stockholders
of the Corporation within twelve (12) months before or after the date the Plan
becomes effective.
17. MODIFICATION OF OPTIONS. At any time and from time to time, the Board
may authorize the Committee to direct the execution of an instrument providing
for the modification of any outstanding Option, provided no such modification,
extension or renewal shall confer on the holder of said Option any right or
benefit which could not be conferred on him by the grant of a new Option at such
time, or shall not materially decrease the Optionee's benefits under the Option
without the consent of the holder of the Option, except as otherwise permitted
under Section 18 hereof. Notwithstanding anything herein to the contrary, the
Committee shall have the authority to cancel outstanding Options with the
consent of the Optionee and to reissue new Options at a lower exercise price,
but in no event less than the then fair market value per share of Common Stock,
in the event that the fair market value per share of Common Stock at any time
prior to the date of exercise of outstanding Options falls below the exercise
price of such Options.
18. AMENDMENT AND TERMINATION OF THE PLAN.
(a) ACTION BY THE BOARD. The Board may alter, suspend, or
discontinue the Plan, except that no action of the Board may increase (other
than as provided in Section 13 hereof) the maximum number of Shares permitted to
be optioned under the Plan, materially increase the benefits accruing to
Participants under the Plan or materially modify the requirements for
eligibility for participation in the Plan unless such action of the Board shall
be subject to approval or ratification by the stockholders of the Corporation.
(b) CHANGE IN APPLICABLE LAW. Notwithstanding any other provision
contained in the Plan, in the event of a change in any federal or state law,
rule or regulation which would make the exercise of all or part of any
previously granted Incentive and/or Non-Incentive Stock Option unlawful or
subject the Corporation to any penalty, the Committee may restrict any such
exercise without the consent of the Optionee or other holder thereof in order to
comply with any such law, rule or regulation or to avoid any such penalty.
19. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued with
respect to any Option granted under the Plan unless the issuance and delivery of
such Shares shall comply with all relevant provisions of law, including, without
limitation, the Securities Act of 1933, as amended, the rules and regulations
promulgated thereunder, any applicable state securities law and the requirements
of any stock exchange upon which the Shares may then be listed.
The inability of the Corporation to obtain from any regulatory body or
authority deemed by the Corporation's counsel to be necessary to the lawful
issuance and sale of any Shares hereunder shall relieve the Corporation of any
liability in respect of the non-issuance or sale of such Shares.
As a condition to the exercise of an Option, the Corporation may require
the person exercising the Option to make such representations and warranties as
may be necessary to assure the availability of an exemption from the
registration requirements of federal or state securities law.
20. RESERVATION OF SHARES. During the term of the Plan, the Corporation
will reserve and keep available a number of Shares sufficient to satisfy the
requirements of the Plan.
21. UNSECURED OBLIGATION. No Participant under the Plan shall have any
interest in any fund or special asset of the Corporation by reason of the Plan
or the grant of any Incentive or Non-Incentive Stock Option under the Plan. No
trust fund shall be created in connection with the Plan or any grant of any
Incentive or Non- Incentive Stock Option hereunder and there shall be no
required funding of amounts which may become payable to any Participant.
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<PAGE> 10
22. WITHHOLDING TAX. The Corporation shall have the right to deduct from
all amounts paid in cash with respect to the cashless exercise of Options under
the Plan any taxes required by law to be withheld with respect to such cash
payments. Where a Participant or other person is entitled to receive Shares
pursuant to the exercise of an Option pursuant to the Plan, the Corporation
shall have the right to require the Participant or such other person to pay the
Corporation the amount of any taxes which the Corporation is required to
withhold with respect to such Shares, or, in lieu thereof, to retain, or sell
without notice, a number of such Shares sufficient to cover the amount required
to be withheld.
23. GOVERNING LAW. The Plan shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania except to the
extent that federal law shall be deemed to apply.
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<PAGE> 1
Exhibit 4.6
SUMMIT BANCORP
1989 STOCK INCENTIVE PLAN
<PAGE> 2
<TABLE>
<CAPTION>
SUMMIT BANCORP
1989 STOCK INCENTIVE PLAN
TABLE OF CONTENTS
PAGE
<S> <C>
1. Establishment, Purpose, and Effective Date of Plan.......................................................1
1.1 Establishment ..................................................................................1
1.2 Purpose ........................................................................................1
1.3 Effective Date .................................................................................1
2. Definitions .............................................................................................1
2.1 Definitions ....................................................................................1
2.2 Gender and Number ..............................................................................3
3. Eligibility and Participation ...........................................................................3
3.1 Eligibility and Participation ..................................................................3
3.2 Eligible Directors .............................................................................4
4. Administration ..........................................................................................4
5. Stock Subject to Plan ...................................................................................4
5.1 Number .........................................................................................4
5.2 Unused Stock ...................................................................................4
5.3 Adjustment in Capitalization ...................................................................4
6. Stock Appreciation Rights Subject to Plan ...............................................................5
6.1 Unexercised Rights .............................................................................5
6.2 Adjustment in Capitalization ...................................................................5
7. Duration of Plan .......................................................................................5
8. Stock Options ...........................................................................................5
8.1 Grant of Options Other than Director Stock Options .............................................5
8.2 Grant of Director Stock Options ................................................................6
8.3 Option Agreement ...............................................................................6
8.4 Option Price ...................................................................................6
8.5 Duration of Options ............................................................................6
8.6 Exercise of Options ............................................................................7
8.7 Payment ........................................................................................7
8.8 Restrictions on Stock Transferability ..........................................................7
8.9 Termination of Employment for Specific Reasons .................................................7
8.10 Termination of Employment For Other Than Section 8.9 Reasons ...................................7
8.11 Termination of Eligible Director Shares ........................................................8
8.12 Nontransferability of Options ..................................................................8
9. Stock Appreciation Rights ...............................................................................8
9.1 Grant of Stock Appreciation Rights .............................................................8
9.2 Exercise of SARs in Lieu of Options ............................................................8
9.3 Exercise of SARs in Addition to Options ........................................................8
9.4 Exercise of SARs Upon Lapse of Options .........................................................9
9.5 Exercise of SARs Independent of Options ........................................................9
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</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
TABLE OF CONTENTS (CONTINUED)
PAGE
<S> <C>
9.6 Payment of SAR Amount ..........................................................................9
9.7 Form and Timing of Payment .....................................................................9
9.8 Limit on Appreciation ..........................................................................9
9.9 Rule 16b-3 Requirements ........................................................................9
9.10 Term of SAR ....................................................................................9
9.11 Termination of Employment ......................................................................9
9.12 Nontransferability of SARs .....................................................................9
10. Restricted Stock Awards ................................................................................10
10.1 Grant of Restricted Stock .....................................................................10
10.2 Transferability ...............................................................................10
10.3 Other Restrictions ............................................................................10
10.4 Certificate Legend ............................................................................10
10.5 Removal of Restrictions .......................................................................10
10.6 Voting Rights .................................................................................10
10.7 Dividends and Other Distributions .............................................................11
10.8 Termination of Employment .....................................................................11
11. Performance Shares .....................................................................................11
11.1 Grant of Performance Shares ...................................................................11
11.2 Performance Period ............................................................................11
11.3 Performance Measurement .......................................................................11
11.4 Payment of Awards .............................................................................11
11.5 Termination of Employment Due to Retirement ...................................................12
11.6 Termination of Employment Due to Death or Disability ..........................................12
11.7 Termination of Employment for Reasons Other Than Death,
Disability, or Retirement ...................................................................12
11.8 Nontransferability of Performance Shares ......................................................12
12. Performance Awards .....................................................................................13
12.1 Grant of Performance Awards ...................................................................13
12.2 Performance Period ............................................................................13
12.3 Performance Measurement .......................................................................13
12.4 Payment of Awards .............................................................................13
12.5 Termination of Employment Due to Retirement ...................................................13
12.6 Termination of Employment Due to Death or Disability ..........................................14
12.7 Termination of Employment for Reasons Other Than Death,
Disability, or Retirement ...................................................................14
12.8 Nontransferability of Performance Awards ......................................................14
13. Beneficiary Designation ................................................................................14
14. Rights of Employees ....................................................................................15
14.1 Employment ....................................................................................15
14.2 Participation .................................................................................15
</TABLE>
ii
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<TABLE>
<CAPTION>
TABLE OF CONTENTS (CONTINUED)
PAGE
<S> <C>
15. Change in Control ......................................................................................15
15.1 In General ....................................................................................15
15.2 Limitation on Payments ........................................................................15
15.3 Definition ....................................................................................15
16. Amendment, Modification, and Termination of Plan .......................................................16
17. Tax Withholding ........................................................................................16
18. Indemnification ........................................................................................17
19. Requirements of Law ....................................................................................17
19.1 Requirements of Law ...........................................................................17
19.2 Governing Law .................................................................................18
</TABLE>
iii
<PAGE> 5
SUMMIT BANCORP
1989 STOCK INCENTIVE PLAN
1. ESTABLISHMENT, PURPOSE AND EFFECTIVE DATE OF PLAN
1.1 ESTABLISHMENT. Summit Bancorp, an Ohio corporation ("Corporation")
hereby establishes the "1989 Stock Incentive Plan" ("Plan") for key employees of
the Corporation and its subsidiaries and for directors of the Corporation who
are not employees of the Corporation or any of its subsidiaries. The Plan
permits the grant of "Director Stock Options" to such directors and the grant of
"Stock Options," "Stock Appreciation Rights," "Restricted Stock Awards,"
"Performance Shares," and "Performance Awards" (all as defined below) to such
employees.
1.2 PURPOSE. The purpose of the Plan is to advance the interests of the
Corporation by encouraging and providing for the acquisition of an equity
interest in the Corporation by directors of the Corporation and key employees of
the Corporation and its subsidiaries and by enabling the Corporation to attract
and retain the services of such directors and key employees upon whose judgment,
interest, and special effort the successful conduct of its operations is largely
dependent.
1.3 EFFECTIVE DATE. The Plan shall become effective as of the date of
its adoption by the Board of Directors of the Corporation, subject to
ratification by the shareholders of the Corporation within twelve months of the
adoption date.
2. DEFINITIONS
2.1 DEFINITIONS. Whenever used herein, the following terms shall have
their meanings set forth below:
"Award" means any Option, Stock Appreciation Right, Restricted
Stock Awards, Performance Share, or Performance Award.
"Board" means the Board of Directors of the Corporation.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the Committee of the Corporation's Board of
Directors which shall consist of three or more directors appointed by
the Board. These directors shall be "disinterested persons" within the
meaning of Rule 16b-3 of the Securities Exchange Act of 1934.
"Corporation" means Summit Bancorp, a bank holding company
under the Bank Holding Company Act of 1956 headquartered in Akron,
Ohio.
"Disability" means disability as determined by the Committee.
"Director Stock Option" means an Option granted to an Eligible
Director. Each Director Stock Option shall be a nonqualified stock
option the grant of which is not intended to fall under the provisions
of Section 422A of the Code.
"Eligible Director" means any statutory director of the
Corporation who is not an employee of the Corporation or any of its
subsidiaries.
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<PAGE> 6
"Fair Market Value" means the closing price of the Stock as
reported on the principal United States securities exchange registered
under the Exchange Act on which such Stock is listed, or, if such Stock
is not listed on any such exchange, the highest closing bid quotation
with respect to a share of such Stock on the National Association of
Securities Dealers, Inc. Automated Quotations System or any
substantially equivalent system then in use on a particular date. In
the event that there are no Stock transactions on such date, the Fair
Market Value shall be determined as of the immediately preceding date
on which there were Stock transactions.
"Option" means the right to purchase Stock at a stated price
for a specified period of time. For purposes of the Plan an Option,
other than a Director Stock Option, may be either (i) an incentive
stock option within the meaning of Section 422A of the Code or (ii) a
nonqualified stock option whose grant is intended to fall under the
provisions of Section 422A.
"Option Agreement" means an agreement entered into between the
Corporation and an employee or an Eligible Director in the form
prescribed by the Committee .
"Option Price" means the price at which each share of Stock
subject to an Option may be purchased, determined in accordance with
Sections 8.1 and 8.4 herein.
"Participant" means any individual, other than an Eligible
Director, designated by the Committee to participate in the Plan
pursuant to Section 3.1 herein.
"Period of Restriction" means the period during which the
transfer of shares of Restricted Stock and/or Performance Shares is
restricted pursuant to Section 10 and/or Section 11 of the Plan.
"Performance Awards" means awards of cash granted to a
Participant pursuant to Section 12 of the Plan.
"Performance Objective" shall mean the performance measure(s)
and the achievement goals of the Corporation or one or more of its
subsidiaries set by the Committee.
"Performance Period" shall mean two or more successive fiscal
years of the Corporation with respect to which a Performance Share or
Performance Award may be earned pursuant to this Plan. Performance
Periods shall begin with the first day of the fiscal year in which a
Performance Share or Performance Award is granted. The length of a
Performance Period shall be at the discretion of the Committee. For
each Performance Share and Performance Award, no more than one
Performance Period shall begin in any one fiscal year of the
Corporation.
"Performance Shares" means Stock granted to a Participant
pursuant to Section 11 of the Plan. Each Performance Share shall be the
equivalent of one share of Stock.
"Restricted Stock" means Stock granted to a Participant
pursuant to Section 10 of the Plan.
"Restricted Stock Agreement" means an agreement entered into
between the Corporation and the Employee in the form prescribed by the
Committee.
"Retirement," "Normal Retirement," and "Early Retirement"
means termination of employment upon the normal retirement age set by
the Board of Directors.
"Stock" means the common stock of the Corporation, without par
value.
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<PAGE> 7
"Stock Appreciation Right" and "SAR" means the right to
receive a cash payment from the Corporation equal to the excess of the
Fair Market Value of a share of Stock at the date of exercise over a
specified price fixed by the Committee which shall not be less than one
hundred percent (100%) of the Fair Market Value of the Stock on the
date of grant. In the case of a Stock Appreciation Right which is
granted in conjunction with an Option, the specified price shall be the
Option exercise price.
2.2 GENDER AND NUMBER. Except when otherwise indicated by the context,
words in the masculine gender when used in the Plan shall include the feminine
gender, the singular shall include the plural, and the plural shall include the
singular.
3. ELIGIBILITY AND PARTICIPATION
3.1 ELIGIBILITY AND PARTICIPATION. Participants in the Plan shall be
selected by the Committee from among those employees of the Corporation and its
subsidiaries who are recommended for participation by the Chief Executive
Officer of the Corporation and who, in the opinion of the Committee, are in a
position to contribute materially to the Corporation's continued growth,
development, and long-term financial success. Persons serving on the Committee
shall not be eligible to be a Participant.
3.2 ELIGIBLE DIRECTORS. Eligible Directors are entitled to participate
in the Plan solely with respect to the grant of Director Stock Options and may
not receive any other Award under the Plan. The selection of Eligible Directors
is not subject to the discretion of the Committee. Persons serving on the
Committee who are Eligible Directors may receive grants of Director Stock
Options.
4. ADMINISTRATION
The Committee shall be responsible for the administration of the Plan.
The Committee, by majority action thereof, is authorized to interpret the Plan,
to prescribe, amend, and rescind rules and regulations relating to the Plan, to
provide for conditions and assurances deemed necessary or advisable to protect
the interests of the Corporation, and to make all other determinations necessary
or advisable for the administration of the Plan, but only to the extent not
contrary to the explicit provisions of the Plan. Determinations,
interpretations, or other actions made or taken by the Committee pursuant to the
provisions of the Plan shall be final and binding and conclusive for all
purposes and upon all persons whomsoever.
5. STOCK SUBJECT TO PLAN
5.1 NUMBER. The total number of shares of Stock subject to issuance
under the Plan may not exceed ten percent (10%) of the total shares of capital
stock of the Company issued and outstanding at any time subject to adjustment
upon occurrence of any of the events indicated in Subsection 6.3. The shares to
be delivered under the Plan may consist, in whole or in part, of authorized but
unissued Stock or issued stock reacquired and held as treasury Stock not
reserved for any other purpose.
5.2 UNUSED STOCK. In the event any shares of Stock that are subject to
an Option which, for any reason, expires or is terminated unexercised as to such
shares, or any shares of Stock subject to a Restricted Stock or Performance
Share grant made under the Plan are reacquired by the Corporation pursuant to
the Plan, such shares again shall become available for issuance under the Plan
except as provided in Section 9.4
5.3 ADJUSTMENT IN CAPITALIZATION. In the event that subsequent to the
date of the Plan by the Board the shares of Stock should as a result of a stock
split, stock dividend, combination or exchange of shares, exchange for other
securities, reclassification, reorganization, redesignation, merger,
consolidation, recapitalization or other such change, be increased or decreased
or changed into or exchanged for a different number or kind of shares of Stock
or other securities of the Corporation or of another corporation, then (a) there
shall automatically be substituted for
3
<PAGE> 8
each share of Stock subject to an unexercised Option (in whole or in part)
granted under the Plan and each share of Stock available for additional grants
of Options under the Plan the number and kind of shares of Stock or other
securities into which each outstanding share of Stock shall be changed or for
which each such Share shall be exchanged, (b) the Option Price shall be
increased or decreased proportionately so that the aggregate purchase price for
the securities subject to the Option shall remain the same as immediately prior
to such event and (c) the Board shall make such other adjustments to the
securities subject to Options and the provisions of the Plan and Option
Agreements as may be appropriate and equitable. Any such adjustment may provide
for the elimination of fractional shares. In such event, the Committee also
shall have discretion to make appropriate adjustments in the number and type of
shares subject to Restricted and Performance Share grants then outstanding under
the Plan pursuant to the terms of such grants or otherwise.
6. STOCK APPRECIATION RIGHTS SUBJECT TO PLAN
6.1 UNEXERCISED RIGHTS. In the event any Stock Appreciation Rights
expire unexercised, such Stock Appreciation Rights again shall become available
for issuance under the Plan.
6.2 ADJUSTMENT IN CAPITALIZATION. In the event of any change in the
outstanding shares of Stock that occurs after ratification of the Plan by the
shareholders of the Corporation by reason of a Stock dividend or split,
recapitalization, merger, consolidation, combination, exchange of shares, or
other similar corporate change, the Committee shall make appropriate adjustments
in the number of outstanding Stock Appreciation Rights and the related granted
values.
7. DURATION OF PLAN
The Plan shall remain in effect, subject to the Board's right to
earlier terminate the Plan pursuant to Section 16 hereof, until all Stock
subject to it shall have been purchased or acquired pursuant to the provisions
hereof. Notwithstanding the foregoing, no Option, Stock Appreciation Right,
Restricted Stock, Performance Share, or Performance Award may be granted under
the Plan on or after the tenth (10th) anniversary of the Plan's effective date.
8. STOCK OPTIONS
8.1 GRANT OF OPTIONS OTHER THAN DIRECTOR STOCK OPTIONS. Subject to the
provisions of Sections 5 and 7, Options other than Director Stock Options may be
granted to Participants at any time and from time to time as shall be determined
by the Committee. The Committee shall have complete discretion in determining
the number of Options granted to each Participant. The Committee also shall
determine whether an Option is to be an incentive stock option within the
meaning of Code Section 422A, or a nonqualified stock option whose grant is
intended not to fall within the provisions of Section 422A. However, in no event
shall the aggregate Fair Market Value (determined at the date of grant) of the
stock of which incentive stock options are first exercisable in a particular
calendar year exceed $100,000, computed in accordance with Section 422A(b)(7) of
the Code.
An incentive stock option shall only be granted to a person who owns,
directly or indirectly, Stock possessing more than ten percent (10%) of the
total combined voting power of all classes of Stock of the Corporation, if the
price of any such Option is at least one hundred and ten percent (110%) of the
Fair Market Value of the Stock subject to the Option and the Option by its terms
is not exercisable more than five (5) years from the date it is granted.
Nothing in this Section 8 shall be deemed to prevent the grant of
nonqualified stock options in excess of the maximum established by Section 422A
of the Code.
8.2 GRANT OF DIRECTOR STOCK OPTIONS. Subject to the provisions of
Sections 5 and 7, Director Stock Options shall be granted to Eligible Directors
as provided in this Section 8.2 and the Committee shall have no discretion with
respect to any matters set forth in this Section 8.2.
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VESTING. Each Director Stock Option shall become exercisable on and
after the first anniversary of the date of the grant.
NUMBER OF SHARES. Commencing immediately after the adjournment of the
Corporation's annual meeting of shareholders ("Annual Meeting") in 1991 and
immediately after the adjournment of the Annual Meeting each year thereafter,
any Eligible Director who was an Eligible Director immediately preceding such
Annual Meeting and who has been elected as a director at such Annual Meeting
shall automatically be granted a Director Stock Option for fifty (50) shares of
Stock if, but only if, the return on common equity of the Corporation as set
forth in the Corporation's annual report to shareholders for the immediately
preceding fiscal year is equal to or greater than ten percent (10%).
8.3 OPTION AGREEMENT. Each Option shall be evidenced by an Option
Agreement that shall specify the type of Option granted, the Option Price, the
duration of the Option, the number of shares of Stock to which the Option
pertains, and such other provisions as the Committee shall determine.
8.4 OPTION PRICE. No Option granted pursuant to the Plan shall have an
Option Price that is less than the Fair Market Value of the Stock on the date
the Option is granted.
8.5 DURATION OF OPTIONS. Each Option, other than Director Stock Options
and Options granted to a person who owns, directly or indirectly, Stock
possessing more than ten percent (10%) of the total combined voting power of all
classes of Stock of the Corporation, shall expire at such time as the Committee
shall determine at the time it is granted; provided, however, that no Option,
other than incentive stock options within the meaning of Section 422A of the
Code, shall be exercisable later than twenty (20) years and one day from the
date of its grant and no such incentive stock option shall be exercisable more
than ten (10) years and one day from the date of grant. No Director Stock Option
may be exercisable later than twenty (20) years and one day from the date of its
grant.
8.6 EXERCISE OF OPTIONS. Options granted under the Plan other than
Director Stock Options shall be exercisable at such times and be subject to such
restrictions and conditions as the Committee shall in each instance approve,
which need not be the same for all Participants.
8.7 PAYMENT. The Option Price upon exercise of any Option shall be
payable to the Corporation in full either (i) in cash or its equivalent, or (ii)
by tendering shares of previously acquired Stock having a Fair Market Value at
the time of exercise equal to the total Option Price, or (iii) by a combination
of (i) and (ii). The proceeds from such a payment shall be added to the general
funds of the Corporation and shall be used for general corporate purposes. As
soon as practicable after receipt of full payment (including the necessary tax
withholding), the Corporation shall deliver to the Participant or the Eligible
Director, as the case may be, Stock certificates in an appropriate amount based
upon the number of Options exercised, issued in the name of the Participant or
the Eligible Director, as the case may be.
8.8 RESTRICTIONS ON STOCK TRANSFERABILITY. The Committee shall impose
such restrictions on any shares of Stock acquired pursuant to the exercise of an
Option under the Plan as it may deem advisable, including, without limitation,
restrictions under applicable Federal securities law, under the requirements of
any stock exchange upon which such shares of Stock are then listed under any
blue sky or state securities laws applicable to such shares.
8.9 TERMINATION OF EMPLOYMENT FOR SPECIFIC REASONS. In the event the
employment of a Participant is terminated for any reason, any outstanding Option
granted pursuant to the Plan and any rights thereunder shall be exercisable by
the Participant (or in the case of a deceased Participant by his legal
representative) only to the extent of the accrued right to exercise such Option
at the date of such termination; provided, however, if such termination is by
reason of death or disability or, with the prior consent of the Committee, by
reason of resignation or retirement, and if at the date of such termination the
Participant had completed twelve (12) full months of employment after the date
of the Option grant the Committee may, in its sole discretion, permit the
exercise of all or any portion of the
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Option not otherwise exercisable and may provide that all or some portion of the
Option shall not terminate upon or by virtue of such employment termination. To
the extent that such Option is exercisable at termination or, as the result of
Committee approval, becomes exercisable at termination it must be exercises
prior to the expiration of the expiration date of the Option or within twelve
(12) months and five (5) days after such date of termination of employment,
whichever period is shorter. However, in the case of incentive stock options,
the favorable tax treatment prescribed under Section 422A of the Code shall not
be available if such Option is not exercised within the required statutory
period as specified in Section 422A.
8.10 TERMINATION OF EMPLOYMENT FOR OTHER THAN SECTION 8.9 REASONS. If
the employment of the Participant shall terminate for any reason other than one
of those specified in Section 8.9 of the Plan, the rights under any then
outstanding Option granted pursuant to the Plan which, pursuant to the terms of
the Option Agreement between the Participant and the Corporation, is exercisable
as of the date of such termination, shall terminate upon the expiration date of
the Option or three (3) months after such date of termination of employment,
whichever first occurs. In its sole discretion, the Committee may extend the
three (3) months up to twelve (12) months and five (5) days, but in no event
beyond the expiration date of the Option.
8.11 TERMINATION OF ELIGIBLE DIRECTOR SHARES. In the event that an
Eligible Director ceases to be an Eligible Director for any reason, the rights
under any then outstanding Director Stock Option granted pursuant to the Plan
which are exercisable as of the date he ceases to be an Eligible Director shall
terminate upon the date determined as provided in Section 8.5 above, or three
(3) months after such cessation date, whichever first occurs; provided, however,
that if he ceases to be an Eligible Director by reason of death, the three (3)
month period shall be extended to the sooner of twelve (12) months and five (5)
days or the expiration date of the Director Stock Option.
8.12 NONTRANSFERABILITY OF OPTIONS. No Option granted under the Plan
may be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, otherwise than by will or by the laws of descent and distribution.
All Options granted to a Participant or an Eligible Director under the Plan
shall be exercisable during his lifetime only by such Participant or Eligible
Director.
9. STOCK APPRECIATION RIGHTS
9.1 GRANT OF STOCK APPRECIATION RIGHTS. Subject to the provisions of
Sections 6 and 7, Stock Appreciation Rights may be granted to Participants at
any time and from time to time as shall be determined by the Committee. A SAR
may be granted, in the discretion of the Committee, in any of the following
forms:
(a) In lieu of Options,
(b) In addition to Options,
(c) Upon lapse of Options, or
(d) Independent of Options.
9.2 EXERCISE OF SARS IN LIEU OF OPTIONS. SARs granted in lieu of
Options may be exercised for all or part of the shares of Stock subject to the
related Option upon the surrender of the right to exercise an equivalent number
of Options. The SAR may be exercised only with respect to the shares of Stock
for which its related Option is then exercisable. SARs granted in lieu of
Options will lapse in the event and to the extent that the related Option is
exercised.
9.3 EXERCISE OF SARS IN ADDITION TO OPTIONS. SARs granted in addition
to Options shall be deemed to be exercised upon the exercise of the related
Options.
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9.4 EXERCISE OF SARS UPON LAPSE OF OPTIONS. SARs granted upon lapse of
Options shall be deemed to have been exercised upon the lapse of the related
Options as to the number of shares of Stock subject to the Options.
9.5 EXERCISE OF SARS INDEPENDENT OF OPTIONS. SARs granted independent
of Options may be exercised upon whatever terms and conditions the Committee, in
its sole discretion, imposes upon the SARs.
9.6 PAYMENT OF SAR AMOUNT. Upon exercise of the SAR, the holder shall
be entitled to receive payment of an amount (subject to Section 9.8 below)
determined by multiplying:
(a) The difference between the Fair Market Value of a share of Stock
at the date of exercise over the price fixed by the Committee at the date of
grant, by
(b) The number of shares with respect to which the SAR is exercised.
9.7 FORM AND TIMING OF PAYMENT. At the discretion of the Committee,
payment for SARs may be made in cash or stock, or in a combination thereof. If
payment is made in Stock, the value of such Stock shall be the Fair Market Value
determined as of the date of exercise.
9.8 LIMIT ON APPRECIATION. At the time of grant, the Committee may
establish, in its sole discretion, a maximum amount per share which will be
payable upon exercise of an SAR.
9.9 RULE 16b-3 REQUIREMENTS. Notwithstanding any other provision of the
Plan, the Committee may impose such conditions on exercise of a SAR (including,
without limitation, the right of the Committee to limit the time of exercise to
specified periods) as may be required to satisfy the requirements of Rule 16b-3
(or any successor rule), under the Securities Exchange Act of 1934.
9.10 TERM OF SAR. The term of SAR granted under the Plan shall not
exceed ten (10) years and one (1) day.
9.11 TERMINATION OF EMPLOYMENT. In the event the employment of a
Participant is terminated by reason of Death, Disability, Retirement, or any
other reason, any SARs outstanding shall terminate in the same manner as
specified for Options under Sections 8.9 and 8.10 herein.
9.12 NONTRANSFERABILITY OF SARS. No SAR granted under the Plan may be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
otherwise than by will or by the laws of descent and distribution. Further, all
SARs granted to a Participant under the Plan shall be exercisable during his
lifetime only by such Participant.
10. RESTRICTED STOCK AWARDS
10.1 GRANT OF RESTRICTED STOCK. Subject to the provisions of Sections 5
and 7, the Committee, at any time and from time to time, may award shares of
Restricted Stock under the Plan to such Participants and in such amounts as it
shall determine. Each Restricted Stock Award shall be evidenced by a Restricted
Stock Agreement that shall specify the Period or Periods of Restriction, the
number of Restricted Stock shares awarded, and such other provisions as the
Committee shall determine.
10.2 TRANSFERABILITY. Except as provided in this Section 10, the shares
of Restricted Stock awarded hereunder may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated for such period of time as
shall be determined by the Committee and shall be specified in the Restricted
Stock Agreement, or upon earlier satisfaction of other conditions as specified
by the Committee in its sole discretion and set forth in the Restricted Stock
Agreement.
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10.3 OTHER RESTRICTIONS. The Committee shall impose such other
restrictions on any shares of Restricted Stock awarded pursuant to the Plan as
it may deem advisable including, without limitation, restrictions under
applicable federal or state securities or tax laws, and may legend the
certificates representing Restricted Stock to give appropriate notice of such
restrictions.
10.4 CERTIFICATE LEGEND. In addition to any legends placed on
certificates pursuant to Section 10.3 hereof, each certificate representing
shares of Restricted Stock granted pursuant to the Plan shall bear a legend
which is comparable to the following:
"The sale or other transfer of this certificate or the shares of stock
represented by this certificate, whether voluntary, involuntary, or by
operation of law, is subject to certain restrictions on transfer and
other terms and conditions set forth in the Summit Bancorp 1989
Stock Incentive Plan and a Restricted Stock Agreement dated
____________, 19_. A copy of the Plan and such Restricted Stock
Agreement may be obtained from the Secretary of Summit Bancorp, 2680
W. Market Street, Akron, Ohio 44313.
10.5 REMOVAL OF RESTRICTIONS. Except as otherwise provided in this
Section 10, shares of Restricted Stock covered by each Restricted Stock Award
made under the Plan shall become freely transferable by the Participant after
the last day of the Period of Restriction. Once the shares are released from the
restrictions, the Participant shall be entitled to have the legend required by
Section 10.4 removed from his Stock certificates.
10.6 VOTING RIGHTS. During the Period of Restriction, Participants
holding shares of Restricted Stock awarded hereunder may exercise full voting
rights with respect to those shares.
10.7 DIVIDENDS AND OTHER DISTRIBUTIONS. During the Period of
Restriction, Participants holding shares of Restricted Stock awarded hereunder
shall be entitled to receive all dividends and other distributions paid with
respect to those shares while they are so held. If any such dividends or
distributions are paid in shares of Stock, the shares shall be subject to the
same restrictions on transferability as the shares of Restricted Stock with
respect to which they were paid.
10.8 TERMINATION OF EMPLOYMENT. In the event that a Participant
terminates his employment with the Corporation for any reason, any shares of
Restricted Stock still subject to restrictions at the date of such termination
automatically shall be forfeited and returned to the Corporation; provided,
however, that the Committee, in its sole discretion, at the time of such
retirement may with respect to some or all of the shares still subject to
restrictions at the time of said termination waive the automatic forfeiture,
and/or reduce the restrictions, and/or modify restrictions applicable to such
shares.
11. PERFORMANCE SHARES
11.1 GRANT OF PERFORMANCE SHARES. Subject to the provisions of Sections
5 and 7, the Committee, at any time and from time to time, may grant Performance
Shares to such Participants and in such amounts as it shall determine. Each
grant of Performance Shares shall be in writing.
11.2 PERFORMANCE PERIOD. The period over which Performance Shares may
be earned shall begin on the first day of the fiscal year in which a grant
occurs. The length of the Performance Period for each grant shall be determined
by the Committee, in its sole discretion, but shall not be less than two (2)
years.
11.3 PERFORMANCE MEASUREMENT. At the beginning of each Performance
Period, Performance Objectives shall be established by the Chief Executive
Officer of the Corporation subject to Committee approval. The degree of
attainment of such Performance Objectives shall determine the number of the
Performance Shares payable at the
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end of the Performance Period, in accordance with a schedule established by the
Chief Executive Officer and approved by the Committee at the beginning of the
Performance Period.
The Committee may adjust the Performance Objectives during the
Performance Period if it is determined that changes in business conditions have
materially and unduly influenced the Corporation's ability to meet the
Performance Objectives.
11.4 PAYMENT OF AWARDS. All payments pursuant to Performance Share
grants shall be made as soon as practicable following the end of the applicable
Performance Period based upon the degree of attainment of the Performance
Objectives. Payments shall be made in Stock. The Committee shall review all
calculations of actual Performance Objective accomplishments and shall make any
adjustments in the computations to recognize material extraordinary or
nonrecurring items if, in the judgment of the Committee, the effect of such
adjustments is equitable and in conformity with the purposes of the Plan.
11.5 TERMINATION OF EMPLOYMENT DUE TO RETIREMENT. In the event that a
Participant terminates his employment with the Corporation because of Normal
Retirement during the Performance Period, the Participant shall be entitled to a
prorated award of Performance Shares as of the most recently completed full
fiscal year of the Performance Period. Payments of Performance Shares determined
in this manner shall be multiplied by a fraction, the numerator of which is the
number of full months which have elapsed since the commencement of the
Performance Period, and the denominator of which is the number of full months in
the particular Performance Period. Payment of Performance Shares in this case
shall be made as soon as practicable following the end of the fiscal year of
termination.
In the event that a Participant terminates his employment with the
Corporation because of Early Retirement, any Performance Shares outstanding at
the date of such Early Retirement automatically shall be forfeited; provided,
however, that the Committee may, in its sole discretion, determine a prorated
value for the Participant's then outstanding Performance Shares as it deems
appropriate. Payment of Performance Shares in this case shall be made as soon as
practicable following the end of the fiscal year of termination.
11.6 TERMINATION OF EMPLOYMENT DUE TO DEATH OR DISABILITY. In the event
a Participant terminates his employment with the Corporation because of Death or
Disability during the Performance Period, the Participant shall be entitled to a
prorated award of Performance Shares as of the most recently completed full
fiscal year of the Performance Period. Payments of Performance Shares determined
in this manner shall be multiplied by a fraction, the numerator of which is the
number of full months which have elapsed since the commencement of the
Performance Period, and the denominator of which is the number of full months in
the particular Performance Period. Payment of Performance Shares in this case
shall be made as soon as practicable following the end of the fiscal year of
termination.
11.7 TERMINATION OF EMPLOYMENT FOR REASONS OTHER THAN DEATH,
DISABILITY, OR RETIREMENT. In the event that a Participant terminates his
employment with the Corporation for any reason other than those set forth in
Sections 11.5 and 11.6 hereof during the Performance Period; then any
Performance Shares still outstanding at the date of such termination
automatically shall be forfeited; provided, however, that, in the event of an
involuntary termination of the employment of a Participant by the Corporation
the Committee may, in its sole discretion, waive the automatic forfeiture of any
or all such Performance Shares as it deems appropriate, and pay a prorated
award.
11.8 NONTRANSFERABILITY OF PERFORMANCE SHARES. No Performance Shares
granted under the Plan may be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated, otherwise than by will or by the laws of descent and
distribution until the termination of the applicable Performance Period. All
rights with respect to Performance Shares granted to a Participant under the
Plan shall be exercisable during his lifetime only by such Participant.
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12. PERFORMANCE AWARDS
12.1 GRANT OF PERFORMANCE AWARDS. Subject to the provisions of Sections
5 and 7, the Committee, at any time and from time to time, may grant Performance
Awards under the Plan to such Participants and in such amounts as it shall
determine. Each grant of Performance Awards shall be in writing.
12.2 PERFORMANCE PERIOD. The period over which Performance Awards may
be earned shall begin on the first day of the fiscal year in which a grant
occurs. The length of the Performance Period for each grant shall be determined
by the Committee in its sole discretion but shall not be less than two (2)
years.
12.3 PERFORMANCE MEASUREMENT. At the beginning of each Performance
Period, Performance Objectives shall be established by the Chief Executive
Officer of the Corporation subject to Committee approval. The degree of
attainment of such Performance Objectives shall determine the value of the
Performance Awards at the end of the Performance Period, in accordance with a
schedule established by the Chief Executive Officer and approved by the
Committee at the beginning of the Performance Period.
The Committee may adjust the Performance Objectives during the
Performance Period if it is determined that changes in business conditions have
materially and unduly influenced the Corporation's ability to meet the
Performance Objectives.
12.4 PAYMENT OF AWARDS. All payments pursuant to Performance Award
grants shall be made as soon as practicable following the end of the applicable
Performance Period based upon the degree of attainment of the Performance
Objectives. Payments shall be made in cash. The Committee shall review all
calculations of actual Performance Objective accomplishments and shall make any
adjustments in the computations to recognize material extraordinary or
nonrecurring items if, in the judgment of the Committee, the effect of such
adjustments is equitable and in conformity with the purposes of the Plan.
12.5 TERMINATION OF EMPLOYMENT DUE TO RETIREMENT. In the event that a
Participant terminates his employment with the Corporation because of Normal
Retirement during the Performance Period, the Participant shall be entitled to a
prorated award of Performance Awards as of the most recently completed full
fiscal year of the Performance Period. Payment of Performance Awards determined
in this manner shall be multiplied by a fraction, the numerator of which is the
number of full months which have elapsed since the commencement of the
Performance Period, and the denominator of which is the number of full months in
the particular Performance Period. Payment of Performance Awards in this case
shall be made as soon as practicable following the end of the fiscal year of
termination.
In the event that a Participant terminates his employment with the
Corporation because of Early Retirement, the Committee may, in its sole
discretion, determine a prorated value for the Participant's then outstanding
Performance Awards as it deems appropriate. Payment of Performance Awards in
this case shall be made as soon as practicable following the end of the fiscal
year of termination.
12.6 TERMINATION OF EMPLOYMENT DUE TO DEATH OR DISABILITY. In the event
a Participant terminates his employment with the Corporation because of Death or
Disability during the Performance Period, the Participant shall be entitled to a
prorated award of Performance Awards as of the most recently completed full
fiscal year of the Performance Period. Payments of Performance Awards determined
in this manner shall be multiplied by a fraction, the numerator of which is the
number of full months which have elapsed since the commencement of the
Performance Period, and the denominator of which is the number of full months in
the particular Performance Period. Payment of Performance Awards in this case
shall be made as soon as practicable following the end of the fiscal year of
termination.
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12.7 TERMINATION OF EMPLOYMENT FOR REASONS OTHER THAN DEATH,
DISABILITY, OR RETIREMENT. In the event that a Participant terminates his
employment with the Corporation for any reason other than those set forth in
Sections 12.5 and 12.6 hereof during the Performance Period, then any
Performance Awards still outstanding at the date of such termination
automatically shall be forfeited; provided, however, that in the event of an
involuntary termination of the employment of a Participant by the Corporation
the Committee may, in its sole discretion, waive the automatic forfeiture of any
or all such Performance Awards as it deems appropriate and pay a prorated award.
12.8 NONTRANSFERABILITY OF PERFORMANCE AWARDS. No Performance Awards
granted under the Plan may be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated, otherwise than by will or by the laws of descent and
distribution until the termination of the applicable Performance Period. All
rights With respect to Performance Awards granted to a Participant under the
Plan shall be exercisable during his lifetime only by such Participant.
13. BENEFICIARY DESIGNATION
Each Participant under the Plan may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit under the Plan is to be paid in case of his death before he
receives any or all of such benefit. Each designation will revoke all prior
designations by the same Participant, shall be in a form prescribed by the
Committee, and will be effective only when filed by the Participant in writing
with the Committee during his lifetime. In the absence of any such designation,
benefits remaining unpaid at the Participant's death shall be paid to his
estate.
14. RIGHTS OF EMPLOYEES
14.1 EMPLOYMENT. Nothing in the Plan shall interfere with or limit in
any way the right of the Corporation to terminate any Participant's employment
at any time, nor confer upon any Participant any right to continue in the employ
of the Corporation.
14.2 PARTICIPATION. No employee shall have a right to be selected as a
Participant, or, having been so selected, to be selected again as a Participant.
15. CHANGE IN CONTROL
15.1 IN GENERAL. In the event that (a) the Corporation is a party to a
merger or consolidation agreement, (b) the Corporation is a party to an
agreement to sell substantially all of its assets, or (c) there is change in
control of the Corporation as defined in Section 15.3 below, the Committee may,
in its sole discretion, provide that all outstanding Awards shall become one
hundred percent (100%) vested, that all outstanding Options and SARs shall
become immediately exercisable and that any Period of Restriction shall
immediately lapse. Performance Share and Performance Award values shall be
computed as if the most recently completed full fiscal year was the end of the
Performance Period, except that no Performance Share or Performance Award
payable under this Section, except as limited by Section 15.2 hereof, may be
less than would have been paid had the Corporation achieved one hundred percent
(100%) of its Performance Objectives.
15.2 LIMITATION ON PAYMENTS. If the receipt of any payment under this
Section by any Participant shall, in the opinion of independent tax counsel of
recognized standing selected by the Corporation, result in the payment by such
Participant of any excise tax provided for in Section 280G and Section 4999 of
the Code, then the amount of such payment shall be reduced to the extent
required, in the opinion of independent tax counsel, to prevent the imposition
of such excise tax.
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15.3 DEFINITIONS. For purposes of the Plan, a "change in control" shall
mean any of the following events:
(a) The acquisition of "beneficial ownership," as defined in Rule 13d-3
promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"), of
twenty percent (20%) or more of the total voting capital Stock of the
Corporation then issued and outstanding, by any person, or "group" as defined in
Section 13(d)(3) of the Exchange Act, or
(b) Individuals who were members of the Board of the Corporation
immediately prior to a meeting of the shareholders of the Corporation involving
a contest for the election of directors do not constitute a majority of the
Board immediately following such election, unless the election of such new
directors was recommended to the shareholders by management of the Corporation.
The Board has final authority to determine the exact date on which a
change in control has been deemed to have occurred under (a) and (b) above.
16. AMENDMENT, MODIFICATION AND TERMINATION OF PLAN
The Board may at any time terminate and, from time to time, may amend
or modify the Plan, provided, however, that no such action of the Board, without
approval of the shareholders, may:
(a) Increase the total amount of Stock which may be issued under the
Plan, except as provided in Subsections 5.1 and 5.3 of the Plan.
(b) Change the provisions of the Plan regarding the Option Price except
as permitted by Subsection 5.3.
(c) Materially increase the cost of the Plan or materially increase the
benefits to Participants.
(d) Extend the period during which Options, Stock Appreciation Rights,
Restricted Stock, Performance Shares, or Performance Awards may be granted.
(e) Extend the maximum period after the date of grant during which
Options may be exercised.
No amendment, modification, or termination of the Plan shall in any
manner adversely affect any Options, Stock Appreciation Rights, Restricted
Stock, Performance Shares, or Performance Awards theretofore granted under the
Plan, without the consent of the Participant or the Eligible Director, as the
case may be.
17. TAX WITHHOLDING
(a) The Corporation shall have the right to withhold from any
payments made under the Plan or to collect as a condition of payment,
any taxes required by law to be withheld. At any time when a
Participant or an Eligible Director, as the case may be, is required to
pay to the Corporation an amount required to be withheld under
applicable income tax laws in connection with a distribution of common
stock or upon exercise of an Option or SAR, the Participant or an
Eligible Director, as the case may be, may satisfy this obligation in
whole or in part by electing ("Election") to have the Corporation
withhold from the distribution shares of common stock having a value
equal to the amount required to be withheld. The value of the shares to
be withheld shall be based on the Fair Market Value of the common stock
on the date that the amount of tax to be withheld shall be determined
("Tax Date").
(b) Each Election must be made prior to the Tax Date. The
Committee may disapprove of any Election, may suspend or terminate the
right to make Elections, or may provide with respect to any grant that
the right to make elections shall not apply to such Grant. An Election
is irrevocable.
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<PAGE> 17
(c) If a Participant is an officer of the Corporation within
the meaning of Section 16 of the Securities Exchange Act of 1934 or if
the person making the Election is an Eligible Director, then an
Election is subject to the following additional restrictions:
(1) No Election shall be effective for a Tax Date
which occurs within six (6) months of the grant of the award,
except that this limitation shall not apply in the event Death
or Disability of the Participant or the eligible Director, as
the case may be, occurs prior to the expiration of the
six-month period.
(2) The Election must be made either six (6) months
prior to the Tax Date or must be made during a period
beginning on the third business day following the date of
release for publication of the Corporation's quarterly or
annual summary statements of sales and earnings and ending on
the twelfth business day following such date.
18. INDEMNIFICATION
Each person who is or shall have been a member of the Committee or of
the Board shall be indemnified and held harmless by the Corporation against and
from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by him in connection with or resulting from any claim,
action, suit, or proceeding to which he may be a party or in which he may be
involved by reason of any action taken or failure to act under the Plan and
against and from any and all amounts paid by him in settlement thereof, with the
Corporation's approval, or paid by him in satisfaction of any judgment in any
such action, suit, or proceeding against him, provided he shall give the
Corporation an opportunity, at its own expense, to handle and defend the same
before he under takes to handle and defend it on his own behalf. The foregoing
right of indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled under the Corporation's
Articles of Incorporation or Code of Regulations, as a matter of law, or
otherwise, or any power that the Corporation may have to indemnify them or hold
them harmless.
19. REQUIREMENTS OF LAW
19.1 REQUIREMENTS OF LAW. The granting of Options, Stock Appreciation
Rights, Restricted Stock, Performance Shares, or Performance Awards, and the
issuance of shares of Stock upon the exercise of an Option shall be subject to
all applicable laws, rules, and regulations, and to such approvals by any
governmental agencies or national securities exchanges as may be required.
19.2 GOVERNING LAW. The Plan, and all agreements hereunder, shall be
construed in accordance with and be governed by the laws of the State of Ohio.
13
<PAGE> 1
EXHIBIT 5.1
[Brouse McDowell, A Legal Professional Association, Letterhead]
February 12, 1999
FirstMerit Corporation
III Cascade Plaza, 7th Floor
Akron, Ohio 44308
Re: Registration on Form S-8 of 930,752 Shares of
Common Stock of FirstMerit Corporation
Gentlemen:
We are acting as counsel to FirstMerit Corporation (the "Company") in
connection with the issuance and sale by the Company of up to 930,752 shares
of its Common Stock (the "Shares") upon the exercise or conversion of certain
stock options. The Shares will be issued and sold to certain employees Signal
Corp pursuant to (i) the Signal Amended and Restated Stock Option and Incentive
Plan; (ii) the Signal Non-Employee Director Stock Option Plan; (iii) the Signal
1997 Omnibus Incentive Plan; (iv) the FirstShenango Bancorp, Inc. 1993 Stock
Option Plan; and (v) the Summit Bancorp 1989 Stock Incentive Plan (collectively,
the "Plans").
We have examined such documents, records and matters of law as we have
deemed necessary for purposes of this opinion, and based thereon we are of the
opinion that the Shares which may be issued and sold pursuant to the Plans, upon
the exercise or conversion of stock options, have been duly authorized and, when
issued and sold in accordance with the terms of the Plans, will be validly
issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to
Amendment No.2 on Form S-8 to the Registration Statement on Form S-4 being filed
by the Company with the Securities and Exchange Commission to effect
registration of the Shares under the Securities Act of 1933.
Very truly yours,
Brouse McDowell, A Legal Professional
Association
/s/ Brouse McDowell, A Legal
Professional Association
<PAGE> 1
Exhibit 23.10
PricewaterhouseCoopers [Logo]
Consent of PricewaterhouseCoopers LLP
We consent to incorporation by reference in the Registration Statement (Form
S-8), of our report dated January 15, 1998, relating to the consolidated balance
sheets of FirstMerit Corporation and subsidiaries as of December 31, 1997 and
1996, and the related consolidated statements of income, shareholders' equity,
and cash flows for each of the years in the three year period ended December 31,
1997, which report appears in the 1997 Annual Report on Form 10-K of FirstMerit
Corporation, as amended by Form 10-K/A filed on April 30, 1998.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Akron, Ohio
February 12, 1999
<PAGE> 1
Exhibit 23.11
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
FirstMerit Corporation on Form S-8 filed as Post Effective Amendment No. 2 to
Registration Statement No. 333-63797 on Form S-4 of our report dated January 26,
1996, related to Signal Corp (formerly known as FirstFederal Financial Services
Corp) for the year ended December 31, 1995 appearing in Form 8-K dated August
31, 1998 of FirstMerit Corporation.
/s/ Deloitte & Touche LLP
Columbus, Ohio
February 10, 1999
<PAGE> 1
Exhibit 23.12
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement on
Form S-8 of FirstMerit Corporation (Post Effective Amendment No. 2 to
Registration Statement No. 333-63797 on Form S-4) of our report dated April 22,
1998, appearing in Appendix C to Part 1 (Prospectus and Proxy Statement) of
Registration Statement No. 333-57439 on Form S-4 of FirstMerit Corporation filed
on June 22, 1998, and to the reference to us under the heading "Experts" in such
Prospectus and Proxy Statement.
/s/ Deloitte & Touche LLP
February 10, 1999
Cleveland, Ohio
<PAGE> 1
Exhibit 23.13
Consent of Independent Auditors'
To the Board of Directors of Signal Corp:
We consent to the incorporation by reference in the registration statement on
Form S-8 of FirstMerit Corporation of our report dated February 6, 1998, except
as to note 1 (Stock Dividend), which is as of April 22, 1998, and note 15, which
is as of June 29, 1998, with respect to the consolidated balance sheets of
Signal Corp and subsidiaries as of December 31, 1997 and 1996, and the related
consolidated statements of income, changes in shareholders' equity and cash
flows for the years then ended, which report appears in the Form 8-K of
FirstMerit Corporation dated August 31, 1998.
Our report refers to the adoption of the Financial Accounting Standards Board's
Statement of Financial Accounting Standards No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities," in 1997.
/s/ KPMG LLP
Cleveland, Ohio
February 10, 1999
<PAGE> 1
Exhibit 23.14
Consent of Independent Auditors
We consent to the incorporation by reference in this Registration Statement
(Post Effective Amendment No. 2 on Form S-8) of FirstMerit Corporation for the
registration of up to 930,752 shares of its common stock of our report dated
February 6, 1998, with respect to the consolidated statements of financial
position of First Shenango Bancorp, Inc. and subsidiaries as of December 31,
1997 and 1996, and the related consolidated statements of income, changes in
shareholders' equity, and cash flows for each of the years in the three year
period ended December 31, 1997 included in FirstMerit Corporation's Form 8-K
dated August 31, 1998 filed with the Securities and Exchange Commission.
/s/ Ernst & Young
Pittsburgh, Pennsylvania
February 10, 1999
<PAGE> 1
Exhibit 24
FIRSTMERIT CORPORATION
LIMITED POWER OF ATTORNEY
REGISTRATION STATEMENTS ON FORM S-8
The undersigned directors and officers of FirstMerit Corporation (the
"Company") hereby constitute and appoint Terry E. Patton, and/or Kevin C.
O'Neil, and each of them, with full power of substitution and resubstitution, as
attorneys or attorney of the undersigned, to execute and file under the
Securities Act of 1933 a Post Effective Amendment on Form S-8 to the
Registration Statement on Form S-4 filed by the Company on September 18, 1998,
to register certain shares of the Company's Common Stock that may be issued by
the Company pursuant to (i) the Signal Amended and Restated Stock Option and
Incentive Plan; (ii) the Signal Non-Employee Director Stock Option Plan; (iii)
the Signal 1997 Omnibus Incentive Plan; (iv) the FirstShenango Bancorp, Inc.
1993 Stock Option Plan; and (v) the Summit Bancorp 1989 Stock Incentive Plan,
and any and all amendments and exhibits to the foregoing Registration Statement
and any and all applications or other documents to be filed with the Securities
and Exchange Commission, National Association of Securities Dealers and any
state securities agencies pertaining to such Registration Statement, with full
power and authority to do and perform any and all acts and things whatsoever
necessary, appropriate or desirable to be done in the premises, or in the name,
place and stead of the said directors and officers, hereby ratifying and
approving the acts of said attorneys and any of them and any such substitute.
Effective the 21st day of January, 1999, unless otherwise indicated
below.
/s/ John R. Cochran /s/ Austin J. Mulhern
- ------------------------------- -------------------------------
John R. Cochran Austin J. Mulhern
Director, Chairman and Chief Executive Vice President,
Executive Officer Finance and Administration
(Chief Financial Officer and
Chief Accounting Officer)
/s/ Karen S. Belden /s/ R. Cary Blair
- ------------------------------- -------------------------------
Karen S. Belden, Director R. Cary Blair, Director
/s/ John C. Blickle /s/ Sid A. Bostic
- ------------------------------- -------------------------------
John C. Blickle, Director Sid A. Bostic, Director
/s/ Richard Colella
- ------------------------------- -------------------------------
Robert W. Briggs, Director Richard Colella, Director
/s/ Elizabeth A. Dalton /s/ Terry L. Haines
- ------------------------------- -------------------------------
Elizabeth A. Dalton, Director Terry L. Haines, Director
/s/ Clifford J. Isroff /s/ Philip A. Lloyd, II
- ------------------------------- -------------------------------
Clifford J. Isroff, Director Philip A. Lloyd, II, Director
/s/ Robert G. Merzweiler
- ------------------------------- -------------------------------
Robert G. Merzweiler, Director Stephen E. Myers, Director
/s/ Roger T. Read /s/ Justin T. Rogers
- ------------------------------- -------------------------------
Roger T. Read, Director Justin T. Rogers, Director
/s/ Richard N. Seaman /s/ Jerry M. Wolf
- ------------------------------- -------------------------------
Richard N. Seaman, Director Jerry M. Wolf, Director
/s/ Charles F. Valentine
------------------------------
Charles F. Valentine, Director
