<PAGE> 1
As filed with the Securities and Exchange Commission on January 11, 1999
Registration No. 333-63929
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------------------------
(POST-EFFECTIVE AMENDMENT NO. 1)
ON FORM S-8
TO FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------------------------
FRONTIER FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Washington 91-1223535
---------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
323 S.W. Everett Mall Way
P.O. Box 2215
Everett, Washington 98203
(Address, including ZIP code, and telephone number,
including area code, of Registrant's principal executive office)
--------------------------------------------
VALLEY BANCORPORATION DIRECTORS STOCK OPTION PLAN
VALLEY BANCORPORATION EMPLOYEE INCENTIVE STOCK OPTION PLAN
(Full Title of the Plan)
--------------------------------------------
James F. Felicetty
Secretary and Treasurer
Frontier Financial Corporation
323 S.W. Everett Mall Way
P.O. Box 2215
Everett, Washington 98203
(425) 514-0719
(Name and address, including ZIP code, and telephone
number, including area code, of agent of service)
--------------------------------------------
with copies to:
Glen P. Garrison
Keller Rohrback L.L.P.
1201 Third Avenue, Suite 3200
Seattle, Washington 98101-3099
(Name and address, including ZIP code, and telephone
number, including area code)
--------------------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Maximum
Title of Securities to be Amount to be Proposed Maximum Offering Aggregate Offering Amount of
Registered Registered(1) Price Per Share(1) Price(2) Registration Fee
---------- ------------- ------------------ -------- ----------------
<S> <C> <C> <C> <C>
Common Shares, No Par Value 49,809 N/A N/A N/A
</TABLE>
(1) The Registrant previously paid $2,976.32 with the original filing
on September 22, 1998 to register 970,473 shares of Frontier Financial
Corporation Common Stock, including 49,809 shares which may be issued pursuant
to the Valley Bancorporation and Director Stock Option Plan and Valley
Bancorporation Employee Inventive Stock Option Plan.
<PAGE> 2
This amendment shall be effective in accordance with the provisions of
Rule 464 promulgated under the Securities Act of 1933.
EXPLANATORY NOTE
The undersigned Registrant hereby files this post-effective amendment
(the "Registration Statement") on Form S-8 to register 49,809 shares of Frontier
Financial Corporation (hereinafter the "Company" or the Registrant") Common
Stock, no par value, previously registered on Form S-4 (File No. 333-63929)
incorporated by reference herein, for issuance pursuant to options granted under
Valley Bancorporation Directors Stock Option Plan and the Valley Bancorporation
Employee Incentive Stock Option Plan (the "Plans"), pursuant to the terms and
conditions of the Agreement and Plan of Mergers dated as of July 30, 1998 (the
"Merger Agreement") by and among the Company and Valley Bancorporation, a
Washington Corporation. Such merger was consummated on December 21, 1998.
<PAGE> 3
PART II
INFORMATION REQUIRED IN REGISTRATION
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents are hereby incorporated by reference into this
Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1997, filed with the Securities and Exchange Commission (the
"Commission") on March 25, 1998 under Section 13(a) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), which contains certified financial
statements for the most recent fiscal year for which such statements have been
filed;
(b) All other reports filed by the Registrant pursuant to Section 13(a)
or 15(d) of the Exchange Act since the end of the fiscal year covered by the
Annual Report on Form 10-K referred to in (a) above; and
(c) The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-A filed with the Commission on
March 27, 1987, under Section 12 of the Exchange Act, including any amendments
or reports filed for the purpose of updating such description.
In addition, any document filed by the Registrant pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to
the filing of a post-effective amendment that indicates that these securities
offered hereby have been sold or that deregisters the securities covered hereby
then remaining unsold shall also be deemed to be incorporated by reference into
this Registration Statement and to be a part hereof commencing on the respective
date on which such document is filed.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sections 23B.08.500 through 23B.08.600 of the Washington Business
Corporation Act (the "WBCA") authorize a court to award, or a corporation's
board of directors to grant, indemnification to directors, officers, employees
and agents of the Registrant and those serving at the Registrant's request in
similar positions in any other corporation, partnership, joint venture, trust or
other enterprise in terms sufficiently broad to permit such indemnification
under certain circumstances for liabilities (including reimbursement for
expenses incurred) arising under the Securities Act of 1933, as amended (the
"Securities Act"). Article IX of the Registrant's Bylaws provides for
indemnification of the Registrant's directors and officers, to the maximum
extent permitted by Washington law, against expenses and liabilities (including
any obligation to pay any judgment, settlement, fine or expenses, including
attorneys' fees) actually and reasonably incurred in connection with any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, in which the director or officer is,
was or is threatened to be made a party to such action or is otherwise involved
in such action by reason of serving or having served at the request of the
Registrant as a director or officer of another corporation.
Section 23B.08.320 of the WBCA authorizes a corporation to limit a
director's liability to the corporation or its shareholders for monetary damages
for acts or omissions as a director, except in certain circumstances involving
intentional misconduct, self-dealing or illegal corporate loans or
distributions, or any transaction from which the director personally receives a
benefit in money, property or services to which the director is not legally
entitled. The Registrant's Articles of Incorporation provide, to the fullest
extent permitted by Washington law, limitations on a director's liability to
<PAGE> 4
the Registrant and its shareholder. The Registrant also maintains an insurance
policy insuring its directors and officers against liability for certain acts or
omissions while acting in their official capacity.
Pursuant to the Merger Agreement, the six year period ending December
21, 2005, the Registrant will cause the persons serving as officers and
directors of Valley Bancorporation and the Bank of Sumner to be covered by the
current policies maintained by Valley Bancorporation with respect to acts or
omissions of officers and directors, in their capacities as such, occurring on
or prior to December 21, 1998.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
See Exhibit Index.
ITEM 9. UNDERTAKINGS
A. The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made,
a post-effective amendment to the Registration Statement;
i. To include any prospectus required by Section 10(a)(3) of
the Securities Act;
ii. To reflect in the prospectus any facts or events arising
after the effective date of this 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 this Registration
Statement; and
iii. To include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(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 be
Commission by the Registration pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in this Registration Statement.
2. That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. To remove from registration by means of a post-effective amendment
any of the securities being registered that remain unsold at the termination of
the offering.
B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filling of any employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange) that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions or otherwise, the
Registrant has been advised that, in the opinion of the Commission, such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling
<PAGE> 5
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filling on Form S-8 and has duly caused this Amendment No. 1 to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Everett, State of Washington, on the
11th day of January, 1999.
FRONTIER FINANCIAL CORPORATION
By:/s/ ROBERT J. DICKSON
-------------------------------------
Robert J. Dickson
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Post-Effective Amendment No. 1 to the Registration Statement has been
signed below by the following persons in the capacities indicated and on the
date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
By: /s/ ROBERT J. DICKSON President and Chief Executive Officer January 11, 1999
--------------------------------------- (Principal Executive Officer)
By: /s/ JAMES F. FELICETTY Secretary and Treasurer January 11, 1999
--------------------------------------- (Principal Financial and Accounting Officer)
By: /*/ Director January 11, 1999
---------------------------------------
GEORGE E. BARBER
By: /*/ Director January 11, 1999
LUCY DEYOUNG
By: /*/ Director January 11, 1999
---------------------------------------
DAVID A. DUJARDIN
By: /*/ Director January 11, 1999
---------------------------------------
EDARD D. HANSEN
By: /*/ Director January 11, 1999
---------------------------------------
WILLIAM H. LUCAS
By: /*/ Director January 11, 1999
---------------------------------------
</TABLE>
<PAGE> 6
<TABLE>
<S> <C> <C>
JAMES M. MULLIGAN
By: /*/ Director January 11, 1999
---------------------------------------
DONALD REGAN
By: /*/ Director January 11, 1999
---------------------------------------
ROGER L. RICE
By: /*/ Director January 11, 1999
---------------------------------------
ROY A. ROBINSON
By: /*/ Director January 11, 1999
---------------------------------------
WILLIAM J. ROBINSON
By: /*/ Director January 11, 1999
---------------------------------------
DARREL J. STORKSON
By: /*/ Director January 11, 1999
---------------------------------------
EDWARD C. RUBATINO
</TABLE>
*By /s/ ROBERT J. DICKSON
------------------------------------
Robert J. Dickson
Attorney-in-Fact
Robert J. Dickson, by signing his name hereto, does sign this document
on behalf of the persons named above, pursuant to a power of attorney duly
executed by such persons previously filed.
<PAGE> 7
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
<S> <C>
5.1 Opinion of Keller Rohrback L.L.P. regarding legality of the Common Stock being registered.*
10.1 Valley Bancorporation Directors Stock Option Plan.
10.2 Valley Bancorporation Employee Incentive Stock Option Plan.
23.1 Consent of Moss Adams L.L.P.
23.2 Consent of Keller Rohrback L.L.P. (included in its Opinion filed as Exhibit 5.1)
24.1 Power of Attorney*
</TABLE>
* Previously filed as an exhibit to the Registrant's Registration
Statement on Form S-4 to which this is Post-Effective Amendment No. 1.
<PAGE> 1
EXHIBIT 10.1
VALLEY BANCORPORATION
DIRECTOR STOCK OPTION PLAN
1. Purpose of the Plan. The purpose of this Plan is to provide
additional incentives to directors of Valley Bancorporation (and its
subsidiaries), thereby helping to attract and retain the best available
personnel for positions as directors of those corporations and otherwise
promoting the success of the business activities of such corporations. It is
intended that Options issued pursuant to this Plan shall constitute nonqualified
stock options.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Board" shall mean the Board of Directors of Bancorp.
(b) "Common Stock" shall mean Bancorp's common stock, par
value $1.00 per share.
(c) "Committee" shall mean the Board or the Committee
appointed by the Board in accordance with Section 4(a) of the Plan.
(d) "Continuous Status as a Director" shall mean the absence
of any interruption or termination of service as a Director.
(e) "Director" shall mean any person serving as a member of
the Board of Bancorp or any of its subsidiaries.
(f) "Bancorp" shall mean Valley Bancorporation, a Washington
corporation.
(g) "Option" shall mean a stock option granted pursuant to the
Plan, which shall constitute a Nonqualified Stock Option.
(h) "Optioned Stock" shall mean the Common Stock subject to an
Option.
(i) "Optionee" shall mean a Director who receives an Option.
(j) "Plan" shall mean this Director Stock Option Plan.
(k) "Parent" shall mean any corporation owning at least eighty
percent (80%) of the total voting power of the issued and outstanding
stock of Bancorp, and eighty percent (80%) at the total value of the
issued and outstanding stock of Bancorp.
(l) "Subsidiary" shall mean any bank or other corporation of
which not less than 50% of the voting shares are held by Bancorp or a
Subsidiary, whether or not such corporation now exists or is hereafter
organized or acquired by Bancorp or a Subsidiary.
-1-
<PAGE> 2
3. Stock Subject to Options.
(a) Number of Shares Reserved. The maximum number of shares
which may be optioned and sold pursuant to the Plan shall be 6,000
shares of the Common Stock of Bancorp (subject to adjustment as
provided in subparagraph 6(i) of the Plan). During the term of this
Plan, Bancorp will at all times reserve and keep available a sufficient
number of shares of its Common Stock to satisfy the requirements of the
Plan.
(b) Expired Options. If any outstanding Option expires or
becomes unexercisable for any reason without having been exercised in
full, the shares of Common Stock allocable to the unexercised portion
of such Option shall again become available for other Options.
4. Administration of the Plan.
(a) The Committee. The Plan shall be administered by the Board
directly, acting as a Committee of the whole, or if the Board elects,
by a separate Committee appointed by the Board for that purpose and
consisting of at least three Board members. All references in the Plan
to the "Committee" shall refer to such separate Committee, if any is
established, or if none is then in existence, shall refer to the Board
as a whole. Once appointed, any such Committee shall continue to serve
until otherwise directed by the Board. From time to time the Board may
increase the size of the Committee and appoint additional members
thereof, remove members (with or without cause), appoint new members in
substitution therefor, and fill vacancies however caused. The Committee
shall select one of its members as chairman, and shall hold meetings at
such times and places as the chairman or a majority of the Committee
may determine.
Members of the Committee who are either eligible for Options
or who have been granted Options shall be counted for all purposes in
determining the existence of a quorum at any meetings of the Committee
and shall be eligible to vote on all matters before the Committee
respecting the granting of Options or administration of the Plan.
At least annually, the Committee shall present a written
report to the Board indicating the Directors to whom Options have been
granted since the date of the last such report, and in each case the
date or dates of Options granted, the number of shares optioned, and
the Option price per share.
At all times, the Board shall have the power to remove all
members of the Committee and thereafter to directly administer the Plan
as a Committee of the whole.
(b) Powers of the Committee. Subject to all provisions and
limitations of the Plan, the Committee shall have the authority and
discretion:
(1) to determine the Directors to whom Options are to
be granted, the times of grant, and the number of shares to be
represented by each Option;
-2-
<PAGE> 3
(2) to determine the Option price for the shares of
Common Stock to be issued pursuant to each Option, subject to
the provisions of subparagraph 6(b) of the Plan;
(3) to determine all other terms and conditions of
each Option granted under the Plan (including specifying the
dates upon which Options become exercisable), which need not
be identical;
(4) to modify or amend the terms of any Option
previously granted, or to grant substitute Options, subject to
the provisions of subparagraphs 6(1) and 6(m) of the Plan;
(5) to interpret the Plan;
(6) to authorize any person or persons to execute and
deliver Option agreements or to take any other actions deemed
by the Committee to be necessary or appropriate to effectuate
the grant of Options by the Committee;
(7) to make all other determinations and take all
other actions which the Committee deems necessary or
appropriate to administer the Plan in accordance with its
terms and conditions.
All actions of the Committee shall be either by (i) a majority vote of
the members of the full Committee at a meeting of the Committee, or (ii) by
unanimous written consent of all members of the full Committee without a meeting
thereof.
All decisions, determinations and interpretations of the Committee
shall be final and binding upon all persons, including all Optionees and any
other holders or persons interested in any Options, unless otherwise expressly
determined by a vote of the majority of the entire Board. No member of the
Committee or of the Board shall be liable for any action or determination made
in good faith with respect to the Plan or any Option.
5. Eligibility. Options may be granted only to Directors. Granting of
Options pursuant to the Plan shall be entirely discretionary with the Committee,
and the adoption of this Plan shall not confer upon any Director any right to
receive any Option or Options pursuant to the Plan unless and until said Options
are granted by the Committee, in its sole discretion. Neither the adoption of
the Plan nor the granting of any Options pursuant to the Plan shall confer upon
any Director or Optionee any right with respect to continuation of status as a
Director, nor shall the same interfere in any way with his right or with the
right of the shareholders of Bancorp or any subsidiary to terminate his status
as a Director at any time.
6. Terms and Conditions of Options. All Options granted pursuant to the
Plan must be authorized by the Committee, and must be documented in written
agreements in such form as the Committee shall from time to time approve, which
agreements shall comply with and be subject to all of the following terms and
conditions:
-3-
<PAGE> 4
(a) Number of Shares. Each Option agreement shall state the
number of shares subject to Option. Any number of Options may be
granted to a single eligible Director at any time and from time to
time.
(b) Option Price and Consideration. The Option price for the
shares of Common Stock to be issued pursuant to the Option shall be
such price, not less than the greater of net book value or fair market
value at the time of grant, as is determined by the Committee.
The Option price shall be payable either (i) in United States
dollars upon exercise of the Option, or (ii) if approved by the Board,
other consideration including without limitation Common Stock of
Bancorp, services, or other property.
(c) Term of Option. Subject to other applicable provisions of
the Plan including but not limited to Section 6(e) herein, the term of
each Option shall be determined by the Committee in its discretion.
(d) Manner of Exercise; Rights as Shareholder. An Option shall
be deemed to be exercised when written notice of exercise has been
given to Bancorp in accordance with the terms of the Option by the
person entitled to exercise the Option, together with full payment for
the shares of Common Stock subject to said notice.
(e) Death of Optionee. In the event of the death of an
Optionee who at the time of his death was a Director and who had been
in Continuous Status as an Director since the date of grant of the
Option, the Option shall terminate on the earlier of (i) one year after
the date of death of the Optionee, or (ii) the expiration date
otherwise provided in the Option agreement, except that if the
expiration date should occur during the 90-day period immediately
following the Optionee's death, such Option shall terminate at the end
of such 90-day period. The Option shall be exercisable at any time
prior to such termination by the Optionee's estate, or by such person
or persons who have acquired the right to exercise the Option by
bequest or by inheritance or by reason of the death of the Optionee.
(f) Disability of Optionee. If an Optionee's status as a
Director is terminated at any time during the Option period by reason
of a disability (within the meaning of Section 22(e) (3) of the
Internal Revenue Code) and if said Optionee had been in Continuous
Status as a Director at all times between the date of grant of the
Option and the termination of his status as a Director, his Option
shall terminate on the earlier of (i) one year after the date of
termination of his status as a Director, or (ii) the expiration date
otherwise provided in his Option agreement.
(g) Termination of Status as a Director.
(1) If an Optionee's status as a Director is
terminated at any time after the grant of his Option for any
reason other than death or disability, as provided in
subparagraphs (e) and (f) above, and excepting if the Director
is removed for
-4-
<PAGE> 5
cause, as provided in (2) below, his Option shall terminate on
the earlier of (i) the same day of the third month after the
date of termination of his status as a Director, or (ii) the
expiration date otherwise provided in his option agreement.
(2) If an Optionee is removed as a Director for cause
at any time after the grant of his Option, then his Option
shall terminate on the date of termination of his status as an
Director. For this purpose, cause shall be deemed to exist
only if the Board has reasonable grounds to believe that
Bancorp has suffered or will suffer substantial injury as a
result of the gross negligence or dishonesty of the Director
whose removal is proposed.
(h) Non-transferability of Options. No Option granted pursuant
to the Plan may be sold, pledged, assigned, hypothecated, transferred,
or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of
the Optionee, only by the Optionee.
(i) Adjustments Upon Changes in Capitalization. Subject to any
required action by the shareholders of Bancorp, the number of shares of
Common Stock covered by each outstanding Option, the number of shares
of Common Stock available for grant of additional Options, and the
price per share of Common Stock specified in each outstanding Option,
shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from any stock split
or other subdivision or consolidation of shares, the payment of any
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
receipt of consideration by Bancorp; provided, however, that conversion
of any convertible securities of Bancorp shall not be deemed to have
been "effected without receipt of consideration." Such adjustment shall
be made by the Committee, whose determination in that respect shall be
final, binding and conclusive.
Except as otherwise expressly provided in this subparagraph
6(i), no Optionee shall have any rights by reason of any stock split or
the payment of any stock dividend or any other increase or decrease in
the number of shares of Common Stock. Except as otherwise expressly
provided in this subparagraph 6(i), any issue by Bancorp of shares of
stock of any class, or securities convertible into shares of stock of
any class, shall not affect the number of shares or price of Common
Stock subject to any Options, and no adjustments in Options shall be
made by reason thereof. The grant of an Option pursuant to the Plan
shall not affect in any way the right or power of Bancorp to make
adjustments, reclassifications, reorganizations or changes of its
capital or business structure.
(j) Date of Grant of Option. The date of grant of an Option
shall, for all purposes, be the date on which the Committee makes the
determination granting such Option. Said date of grant shall be
specified in the Option agreement.
(k) Conditions Upon Issuance of Shares. Shares of Common Stock
shall not be issued with respect to an Option granted under the Plan
unless the exercise of such
-5-
<PAGE> 6
Option and the issuance and delivery of such shares pursuant thereto
shall comply with all applicable provisions of law, including,
applicable federal and state securities laws.
As a condition to the exercise of an Option, Bancorp may
require the person exercising such Option to represent and warrant at
the time of exercise that the shares of Common Stock are being
purchased only for investment and without any present intention to sell
or distribute such Common Stock if, in the opinion of counsel for
Bancorp, such a representation is required by any of the aforementioned
relevant provisions of law.
(1) Merger, Sale of Assets, Etc. In the event of the merger or
reorganization of Bancorp with or into any other corporation, or in the
event of a proposed sale of substantially all of the assets of Bancorp,
or in the event of a proposed dissolution or liquidation of Bancorp
(collectively, "sale transaction"): (1) all outstanding Options that
are not then fully exercisable shall become exercisable upon the date
of closing of any sale transaction or such earlier date as the
Committee may fix; and (2) the Committee may, in the exercise of its
sole discretion, terminate all outstanding Options as of a date fixed
by the Committee. In such event, however, the Committee shall notify
each Optionee of such action in writing not less than sixty (60) days
prior to the termination date fixed by the Committee, and each Optionee
shall have the right to exercise his Option prior to said termination
date.
(m) Substitute Stock Options. In connection with the
acquisition or proposed acquisition by Bancorp or any Subsidiary,
whether by merger, acquisition of stock or assets, or other
reorganization transaction, of a business any employees of which have
been granted incentive stock options, the Committee is authorized to
issue, in substitution of any such unexercised stock option, a new
Option under this Plan which confers upon the Optionee substantially
the same benefits as the old option.
(n) Tax Compliance. Bancorp, in its sole discretion, may take
any actions reasonably believed by it to be required to comply with any
local, state, or federal tax laws relating to the reporting or
withholding of taxes attributable to the grant or exercise of any
Option or the disposition of any shares of Common Stock issued upon
exercise of an Option, including, but not limited to, (i) withholding
from any Optionee exercising an Option a number of shares of Common
Stock having a fair market value equal to the amount required to be
withheld by Bank under applicable tax laws, and (ii) withholding from
any form of compensation or other amount due an Optionee or holder of
shares of Common Stock issued upon exercise of an Option any amount
required to be withheld by Bank under applicable tax laws. Withholding
or reporting shall be considered required for purposes of this
subparagraph if any tax deduction or other favorable tax treatment
available to Bank is conditioned upon such reporting or withholding
(o) Other Provisions. Option agreements executed pursuant to
the Plan may contain such other provisions as the Committee shall deem
advisable.
-6-
<PAGE> 7
7. Term of the Plan. The Plan shall become effective on the date of
shareholder approval of the Plan as provided in paragraph 9 of the Plan. Unless
sooner terminated as provided in subparagraph 8(a) of the Plan, the Plan shall
terminate on the TENTH ANNIVERSARY of its effective date. Options may be granted
at any time after the effective date and prior to the date of termination of the
plan.
8. Amendment or Early Termination of the Plan.
(a) Amendment or Early Termination. The Board may terminate
the Plan at any time. The Board may amend the Plan at any time and from
time to time in such respects as the Board may deem advisable, except
that, without approval of the shareholders, no such revision or
amendment shall increase the number of shares of Common Stock subject
to the Plan other than in connection with an adjustment under
subparagraph 6(i) of the Plan.
(b) Effect of Amendment or Termination. No amendment or
termination of the Plan shall affect Options granted prior to such
amendment or termination, and all such Options shall remain in full
force and effect notwithstanding such amendment or termination.
9. Shareholder Approval. Effectiveness of the Plan shall be subject to
approval of the Plan by affirmative vote of the shareholders of Bancorp at a
duly convened meeting.
CERTIFICATE OR ADOPTION
I certify that the foregoing Director Stock Option Plan was approved by
the Board of Directors of Valley Bancorporation on March 17, 1994, and by its
shareholders on April 21, 1994.
/s/ Kinuyo Ota
----------------------------------------
Secretary
<PAGE> 1
EXHIBIT 10.2
VALLEY BANCORPORATION
EMPLOYEE INCENTIVE STOCK OPTION PLAN
1. Purpose of the Plan. The purpose of this Plan is to provide
additional incentives to key officers of Valley Bancorporation and its present
and future Subsidiaries, thereby helping to attract and retain the best
available personnel for positions of responsibility with said corporations and
otherwise promoting the success of the business activities of said corporations.
It is intended that all Options issued pursuant to this Plan shall constitute
"incentive stock options" within the meaning of Section 422A of the Internal
Revenue Code.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Employer" shall mean Valley Bancorporation, a Washington
corporation.
(b) "Board" shall mean the Board of Directors or the Employer.
(c) "Common stock" shall mean the Employers common stock, par
value $1.00 per share.
(d) "Committee" shall mean the Committee appointed by the
Board in accordance with section 4(a) of the Plan.
(e) "Continuous Status as an Employee" shall mean the absence
of any interruption or termination of service as an Employee. Continuous Status
as an employee shall not be considered interrupted in the case of sick leave,
military leave, or any other approved leave of absence.
(f) "Employee" shall mean any person employed by the Employer
or any Parent or subsidiary of the Employer which now exists or is hereafter
organized or is acquired by the Employer.
(g) "Option" shall mean a stock option granted pursuant to the
Plan.
(h) "Optioned Stock" shall mean the Common Stock subject to an
Option.
(i) "Optionee" shall mean an Employee who receives an Option.
(j) "Plan" shall mean this Employee Incentive stock Option
Plan.
(k) "Parent" shall mean any corporation having a relationship
with the Employer as described in Section 425(e) of the Internal Revenue Code.
(l) "Shareholder-Employee" shall mean Employee who owns stock
representing more than TEN PERCENT (10%) of the total combined voting power of
all classes
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of stock of the Employer or of any Parent or Subsidiary. For this purpose, the
attribution of stock ownership rules provided in Section 435(4) of the Internal
Revenue Code shall apply.
(m) "Subsidiary" shall mean any bank or other corporation of
which not less than 50% of the voting shares are held by the Employer or a
Subsidiary, whether or not such corporation now exists or is hereafter organized
or acquired by the Employer or a Subsidiary.
3. Stock Subject to Options.
(a) Number of Shares Reserved. The maximum number of shares
which may be optioned and sold pursuant to the Plan shall be 10,000 shares of
the Common Stock of the Employer (subject to adjustment as provided in
subparagraph 6(j) of the Plan). During the term of this Plan, the Employer will
at all times reserve and keep available a sufficient number of shares of its
Common Stock to satisfy the requirements of the Plan.
(b) Expired Options. If any outstanding Option expires or
becomes unexercisable for any reason without having been exercised in full, the
shares of Common Stock allocable to the unexercised portion of such Option shall
again become available for other Options.
4. Administration of the Plan.
(a) The Committee. The Plan shall be administered by a
Committee appointed by the Board. The Committee shall consist of not less than
three members of the Board. Once appointed, the Committee shall continue to
serve until otherwise directed by the Board. From time to time the Board may
increase the size of the committee and appoint additional members thereof,
remove members (with or without cause), appoint new members in substitution
therefor, and fill vacancies however caused. The committee shall select one of
its members as chairman, and shall hold meetings at such times and places as the
chairman or a majority of the committee may determine.
At all times, a majority of the members of the Committee shall consist
of members of the Board who are not eligible to receive options under the plan.
Members of the committee who are either eligible for options or who have been
granted options shall be counted for all purposes in determining the existence
of a quorum at any meetings of the Committee and shall be eligible to vote on
all matters before the committee respecting the granting of Options or
administration of the plan, except only that no such members shall vote or
otherwise act upon the grant or the modification of the terms of any Option
granted or to be granted to himself.
At least annually, the Committee shall present a written report of the
Board indicating the Employees to whom Options have been granted since the date
of the last such report, and in each case the date or dates of Options granted,
the number of shares optioned, and the option price per share.
The Board further shall have the power at any time to remove all
members of the committee and thereafter to directly administer the Plan as a
Committee of the whole. In such event, all references in the Plan to the
"Committee" shall refer to the Board.
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<PAGE> 3
(b) Powers of the Committee. Subject to all provisions and
limitations of the plan, the committee shall have the authority and discretion:
(1) to determine the Employees to whom Options are to be
granted, the times of grant, and the number of shares to be represented
by each Option;
(2) to determine the Option price for the shares of Common
Stock to be issued pursuant to each Option, subject to the provisions
of subparagraph 6(b) of the Plan;
(3) to determine all other terms and conditions of each Option
granted under the Plan, which need not be identical;
(4) to modify or amend the terms of any Option previously
granted, or to grant substitute Options, subject to the provisions of
subparagraph 6(m) of the Plan;
(5) to interpret the Plan;
(6) to authorize any person or persons to execute and deliver
Option agreements or to take actions deemed by the Committee to be
necessary or appropriate to effectuate the grant of Options by the
Committee;
(7) to make all other determinations and take all other
actions which the Committee deems necessary or appropriate to
administer the Plan in accordance with its terms and conditions
All actions of the Committee shall be either by (i) a majority vote of
the members of the full Committee at a meeting of the Committee, or (ii) by
unanimous written consent of all members of the full Committee without a meeting
thereof.
All decisions, determinations and interpretations of the Committee
shall be final and binding upon all persons, including all Optionees and any
other holders or persons interested in any Options, unless otherwise expressly
determined by a vote of the majority of the entire Board.
No member of the Committee or of the Board shall be liable for any
action or determination made in good faith with respect to the Plan or any
Option.
5. Eligibility. Options may be granted only to Employees whom the
Committee, in its discretion, determines to be key Employees.
Granting of Options pursuant to the Plan shall be entirely
discretionary with the Committee, and the adoption of this Plan shall not confer
upon any Employee any right to receive any Option or Options pursuant to the
Plan unless and until said Options are granted by the Committee, in its sole
discretion. Neither the adoption of the Plan nor the granting of any Options
pursuant to the Plan shall confer upon any Employee or Optionee any right with
respect to continuation of employment, nor shall the same interfere in any way
with his right or with the right of the Employer or any subsidiary to terminate
his employment at any time.
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<PAGE> 4
6. Terms and Conditions of Options. All stock Options granted pursuant
to the Plan must be authorized by the Committee, and must be documented in
written agreements in such form as the Committee shall from time to time
approve, which agreements shall comply with and be subject to all of the
following terms and conditions:
(a) Number of shares; Annual Limitation. Each Option agreement
shall state the number of shares subject to Option. Any number of Options may be
granted to a single eligible Employee at any time and from time to time, except
only that the aggregate fair market value, (determined as of the time each
Option is granted) of all shares of Common Stock with respect to which Options
are exercisable for the first time by such Employee in any one calendar year
(under all incentive stock option plans of the Employer, its Parent and all of
its Subsidiaries taken together) shall not exceed $100,000.
(b) Option Price and Consideration. The Option price for the
shares of Common Stock to be issued pursuant to the Option shall be such price
as is determined by the Committee, but shall in no event be less than the fair
market value of the Common Stock on the date of grant of the Option. In the case
of an Option granted to an Employee who, immediately before the grant of such
Option, is a Shareholder-Employee, the Option price shall be at least 110% of
the fair market value of the common Stock on the date of grant of the Option.
The fair market value shall be determined by the Committee in its discretion;
provided, however, that in the event that there is a public market for the
Common Stock, the fair market value shall be the mean of the bid and asked
prices of the Common Stock as of the date of grant as reported on the National
Association of Securities Dealers Automatic Quotation System (NASDAQ), or, in
the event the Common Stock is listed on a stock exchange, the fair market value
shall be the closing price on the exchange as of the date of grant of the
Option.
The Option price shall be payable either (i) in United States dollars
upon exercise of the Option, or (ii) if so determined by the Committee and
specified in the Option agreement, in other property, including without
limitation Common Stock of the Employer.
(c) Term of Option. No Option granted pursuant to the Plan
shall in any event be exercisable after the expiration of ten (10) years from
the date such Option is granted, except that the term of each Option granted to
an Employee who, immediately before such Option is granted, is a
Shareholder-Employee shall be for not more than five (5) years from the date of
grant thereof. Subject to the foregoing and other applicable provisions of the
Plan, the term of each Option shall be determined by the Committee in its
discretion.
(d) Manner of Exercise; Rights as Shareholder. An Option shall
be deemed to be exercised when written notice of exercise has been given to the
Employer in accordance with the terms of the Option by the person entitled to
exercise the Option, together with full payment for the shares of Common Stock
subject to said notice.
Until the issuance (as evidenced by the appropriate entry on the books
of the duly authorized transfer agent of the Employer) of the stock certificate
evidencing such shares of Common Stock, no right to vote or receive dividends or
any other rights as a stockholder shall vest with respect to the Optioned
Shares, notwithstanding the exercise of the Option. No
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<PAGE> 5
adjustment will be made for any dividend or other right for which the record
date is prior to the date the stock certificate is issued, except as provided in
subparagraph 6(j).
(e) Death of Optionee. In the event of the death of an
Optionee who at the time of his death was an Employee and who had been in
Continuous Status as an employee since the date of grant of the Option, the
Option shall terminate on the earlier of (i) one year after the date of death of
the Optionee, or (ii) the expiration date otherwise provided in the Option
agreement. The Option shall be exercisable at any time prior to such termination
by the optionee's estate or by such person or persons who have acquired the
right to exercise the Option by bequest or by inheritance or by reason of the
death of the Optionee.
(f) [DELETED]
(g) Disability of Optionee. If an Optionee's status as an
Employee is terminated at any time during the Option period by reason of a
disability (within the meaning of Section 22(e)(3) of the Internal Revenue Code)
and it said Optionee had been in Continuous Status as an Employee at all times
between the date of grant of the Option and the termination of his status as an
Employee, his Option shall terminate on the earlier of (i) one year after the
date of termination of his status as an Employee or (ii) the expiration data
otherwise provided in his Option agreement. The option shall be exercisable by
the optionee at any time prior to such termination date.
(h) Termination of Status as an Employee.
(1) If an Optionee's status as an Employee is
terminated at any time after the grant of his Option for any
reason other than death or disability, as provided in
subparagraphs (f) and (g) above, or termination by reason of
fraud or willful misconduct, as provided in (2) below, his
Option shall terminate on the earlier of (i) the same day of
the third month after the date of termination of his status as
an Employee, or (ii) the expiration date otherwise provided in
his Option agreement. The Option shall be exercisable by the
Optionee at any time prior to such termination date.
(2) If an optionee's status as an Employee is
terminated at any time after the grant of his Option by reason
of fraud or willful misconduct, then his Option shall
terminate on the date of termination of his status as an
Employee.
(i) Non-transferability of Options. No Option granted pursuant
to the Plan may be sold, pledged, assigned, hypothecated, transferred, or
disposed of in any manner other than by will or by the laws of descent or
distribution and may be exercised, during the lifetime of the Optionee, only by
the optionee.
(j) Adjustments Upon Changes in Capitalization. Subject to any
required action by the shareholders of the Employer, the number of shares of
Common Stock covered by each outstanding Option, the number of shares of Common
Stock available for grant of additional Options, and the price per share of
Common Stock specified in each outstanding Option, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from any stock split or other subdivision or consolidation of
shares, the payment of any stock dividend (but only on the Common Stock) or any
other increase
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<PAGE> 6
or decrease in the number of such shares of Common Stock effected without
receipt of consideration by the Employer; provided, however, that conversion of
any convertible securities of the Employer shall not be deemed to have been
"effected without receipt of consideration." Such adjustment shall be made by
the Committee, whose determination in that respect shall be final, binding and
conclusive.
No Option shall be adjusted by the Committee pursuant to this
subparagraph 6(j) in a manner which causes the Option to fail to continue to
qualify as an incentive stock option within the meaning of Section 422A of the
Revenue Code.
Except as otherwise expressly provided in this subparagraph 6(j), no
Optionee shall have reason of any stock split or the payment of any stock
dividend or any other increase or decrease in the number of shares of Common
Stock. Except as otherwise expressly provided in this subparagraph 6(j), any
issue by the Employer of shares of stock of any class, or securities convertible
into shares of stock of any class, shall not affect the number of shares or
price of Common Stock subject to any Options, and no adjustments in Options
shall be made by reason thereof. The grant of an Option pursuant to the Plan
shall not affect in any way the right or power of the Employer to make
adjustments, reclassifications, reorganizations or changes of its capital or
business structure.
(k) Date of Grant of Option. The date of grant of an Option
shall, for all purposes, be the date on which the Committee makes the
determination granting such Option. Said date of grant shall be specified in the
Option agreement.
(l) Conditions Upon Issuance of Shares. Shares of Common Stock
shall not be issued with respect to an Option granted under the Plan unless the
exercise of such Option and the issuance and delivery of such shares pursuant
thereto shall comply with all relevant provisions of law, including, without
limitation, the Securities Act of 1933, as amended, the Securities Exchange Act
of 1934, as amended, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the Common Stock may then be
listed, and shall be further subject to the approval of counsel for the Employer
with respect to such compliance.
As a condition to the exercise of an Option, the Employer may require
the person exercising such Option to represent and warrant at the time of
exercise that the shares of Common Stock are being purchased only for investment
and without any present intention to sell or distribute such Common Stock if, in
the opinion of counsel for the Employer, such a representation is required by
any of the aforementioned relevant provisions of law
(m) Merger, Sale of Assets. Etc. In the event of the merger of
the Employer with or into any other corporation, or in the event of a proposed
sale of substantially all of the assets of the Employer, or in the event of a
proposed dissolution or liquidation of the employer, the Committee may, in the
exercise of its sole discretion, terminate all outstanding Options as of a date
fixed by the Committee. In such event, however, the Committee shall notify each
Optionee of such action in writing not less than sixty (60) days prior to the
termination date fixed by the Committee, and each Optionee shall have the right
to exercise his Option prior to said termination date.
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<PAGE> 7
(n) Other Provisions. Option agreements executed pursuant to
the Plan may contain such other provisions as the Committee shall deem
advisable, provided that the provisions are not inconsistent with the provisions
of Section 422A)(b) of the Internal Revenue Code or with any of the other terms
and conditions of this Plan.
7. Term of the Plan. The Plan shall be come effective on the earlier of
(a) the date of adoption of the Plan by the Board; or (b) the date of
shareholder approval of the Plan as provided in paragraph 9 of the Plan. Unless
sooner terminated as provided in subparagraph 8(a) of the Plan, the Plan shall
terminate on the tenth anniversary of its effective date. Options may be granted
at any time after the effective date and prior to the date of termination of the
Plan.
8. Amendment or Early Termination of the Plan.
(a) Amendment of Early Termination. The Board may terminate
the Plan at any time. The Board may amend the Plan at any time and from time to
time in such respects as the Board may deem advisable, except that, without
approval of the holders of a majority of the outstanding shares of the Common
Stock, no such revision or amendment shall:
(1) increase the number of chase of Common Stock
subject to the Plan other than in connection with an
adjustment under subparagraph 6(j) of the Plan; or
(2) change the designation of the class of Employees
eligible to be granted Options, as provided in paragraph 5 of
the Plan.
(b) Effect of Amendment or Termination. No amendment or
termination of the Plan shall effect Options granted prior to such amendment or
termination, and all such Options shall remain in full force and effect
notwithstanding such amendment or termination.
9. Shareholder Approval. Continuance of the Plan shall be subject to
approval of the Plan by affirmative vote of the holders of a majority of the
outstanding shares of Common Stock of the Employer at a duly convened meeting of
the shareholders of the Employer, which approval must occur within twelve (12)
months before or after the date of adoption of the Plan by the Board.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Post Effective Amendment Number 1 on Form S-8 to the
Registration Statement on Form S-4 (No. 333-63929) of our report dated January
20, 1998 included in Frontier Financial Corporation's Annual Report on Form 10-K
for the year ended December 31, 1997.
/s/ MOSS ADAMS LLP
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MOSS ADAMS LLP
Everett, Washington
January 11, 1999
