<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
WEST COAST BANCORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
March 23, 1999
Dear Shareholder:
You are cordially invited to attend the annual meeting of shareholders
of West Coast Bancorp to be held at the Embassy Suites Hotel, located at 9000
S.W. Washington Square Road, Tigard, Oregon, on Friday, April 23, 1999, at 2:00
p.m. local time. The Embassy Suites is located near Washington Square. Take
Interstate 5 to Highway 217 (west bound). Exit at Scholls Ferry/Progress and
turn right onto Scholls Ferry. Take a right onto Hall. The Embassy Suites is on
the right.
At the annual meeting, you will be asked to elect four director
nominees to a term of three years and to approve a new 1999 Stock Option Plan,
along with any other business that properly is raised before close of the annual
meeting.
YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE IN FAVOR
OF THE ABOVE MATTERS.
A proxy card is enclosed in the front of your mailing envelope. Please
indicate your voting instructions and sign, date, and return the proxy card
promptly in the business reply envelope provided. This year, you also have the
option of voting via the Internet or by telephone. If you choose one of these
options, please do not also mail your proxy card to us. Instructions on how to
vote through the internet or by telephone are located in the enclosed Proxy
Statement. Whether or not you plan to attend the annual meeting in person, it is
important that you return the enclosed proxy card, or vote via the Internet or
telephonically, so that your votes will be counted, even if you are unable to
attend the meeting. A proxy that is returned with no voting instructions, will
be voted in favor of the matters and, in appropriate circumstances, will enable
West Coast Bancorp's management to adjourn the meeting to continue to solicit
votes to approve these matters. You may revoke your proxy after you have given
it to us, as long as you do so before the official vote is taken at the annual
meeting, by (1) providing written notice of your revocation to the Secretary of
West Coast Bancorp, (2) submitting a later-dated proxy, or (3) appearing at the
meeting and electing to vote in person.
We value you as a West Coast Bancorp shareholder, and we look forward
to reporting our 1998 activities to you.
Sincerely,
Victor L. Bartruff
President and CEO
<PAGE> 3
WEST COAST BANCORP
5335 MEADOWS ROAD, SUITE 201
LAKE OSWEGO, OREGON 97035
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 23, 1999
2:00 P.M., PACIFIC TIME
To the Shareholders of West Coast Bancorp:
We invite you to attend the 1999 Annual Shareholders Meeting of West
Coast Bancorp ("Company") at the Embassy Suites Hotel, located at 9000 S.W.
Washington Square Road, Tigard, Oregon, on Friday, April 23, 1999, at 2:00 p.m.
local time. The meeting's purpose is to vote on the following proposals,
together with any other business that may properly come before the meeting:
1. ELECT FOUR DIRECTORS TO THREE-YEAR TERMS. The Board has nominated
for re-election current directors Victor L. Bartruff and William
B. Loch. In addition, the Board has nominated Michael J. Bragg,
chair of the board of directors of the Company's subsidiary West
Coast Trust, and Mary B. Pearmine.
2. ADOPT 1999 STOCK OPTION PLAN. The Board asks you to adopt a new
stock option plan to replace the Company's current employee stock
option plan.
You may vote on these proposals in person or by proxy. We encourage you
to promptly complete and return the enclosed proxy card, or to vote
electronically by telephone or internet, in order to ensure that your shares
will be represented and voted at the meeting in accordance with your
instructions. If you attend the meeting in person, you may withdraw your proxy
and vote your shares. Only those shareholders of record at the close of business
on March 5, 1999, are entitled to notice of, and to vote at, the Annual Meeting.
Further information regarding voting rights and the business to be
transacted at the Annual Meeting is given in the accompanying Proxy Statement.
The directors, officers, and personnel who serve you genuinely appreciate your
continued interest as a shareholder in the affairs of the Company, its growth,
and development.
March 23, 1999 BY ORDER OF THE BOARD OF DIRECTORS
Shauna L. Vernal, Secretary
================================================================================
YOUR VOTE IS IMPORTANT
Whether or not you plan to attend the Annual Meeting, please sign and date your
Proxy card and return it in the enclosed postage prepaid envelope. Retention of
the Proxy is not necessary for admission to the Annual Meeting. Instead of
submitting your proxy vote with the paper Proxy Card, you can vote
electronically via the Internet or by telephone. See "Voting Via the Internet or
By Telephone" in the Proxy Statement for further details.
================================================================================
<PAGE> 4
WEST COAST BANCORP
5335 MEADOWS ROAD, SUITE 201
LAKE OSWEGO, OREGON 97035
(503) 684-0884
PROXY STATEMENT
MEETING INFORMATION. This Proxy Statement and the accompanying Proxy are
being sent to shareholders on or about March 23, 1999, for use in connection
with the annual meeting of shareholders ("Annual Meeting") of West Coast Bancorp
("Company" or "WCB") to be held on Friday, April 23, 1999. Only those
shareholders of record at the close of business on March 5, 1999 ("Record
Date"), are entitled to vote. There were approximately 14,177,000 shares of the
Company's no par value common stock ("Common Stock") outstanding on the Record
Date.
SOLICITATION OF PROXIES. Shareholder Proxies are being solicited by the
Company's board of directors ("Board"), and the Company is paying the associated
costs. Solicitation may be made by directors and officers of the Company and its
subsidiaries, West Coast Bank ("Bank") and West Coast Trust, Inc. ("WCT"),
(collectively, the "Subsidiaries"). Solicitation may be made through the mail,
or by telephone, facsimile, or personal interview. The Company does not expect
to pay any compensation for the solicitation of proxies, except to brokers,
nominees, and similar recordholders for reasonable expenses in mailing proxy
materials to beneficial owners.
QUORUM. At least a majority of the total number of the Company's
outstanding Common Stock shares must be present, in person or by proxy, to
constitute a quorum at the Annual Meeting. Abstentions will be counted as shares
present and entitled to vote at the Annual Meeting for purposes of determining
the presence of a quorum. Broker non-votes will not be considered shares present
and will not be included in determining whether a quorum is present.
VOTING ON MATTERS PRESENTED. The four nominees for election as directors
at the Annual Meeting who receive the highest number of affirmative votes will
be elected. Shareholders are not permitted to cumulate their votes for the
election of directors. Votes may be cast for or withheld from each nominee.
Votes that are withheld and broker non-votes will have no effect on the outcome
of the election. With respect to the proposals to approve the adoption of a new
1999 Stock Option Plan, stockholders may vote for the proposal, against the
proposal or may abstain from voting. The affirmative vote of a majority of the
total votes present, in person or by proxy, at the Annual Meeting is required
for the approval to adopt the stock option plan. Shareholders of record will be
entitled to one vote per share on any matter that may properly come before the
Annual Meeting.
VOTING OF PROXIES. Shares of Common Stock represented by properly
executed proxies that are received in time and not revoked, will be voted in
accordance with the instructions indicated on the proxies. If no instructions
are indicated, the persons named in the Proxy will vote the shares represented
by the Proxy FOR the four nominees listed in this Proxy Statement, and FOR the
adoption of the 1999 Stock Option Plan, unless otherwise directed. Any proxy
given by a shareholder may be revoked before its exercise by (1) giving notice
to the Company in writing, (2) delivery to the Company of a subsequently dated
proxy, or (3) notifying the Company at the Annual Meeting before the shareholder
vote is taken. The shares represented by properly executed, unrevoked proxies
will be voted in accordance with the specifications in the Proxy.
1
<PAGE> 5
VOTING ELECTRONICALLY OR BY TELEPHONE. Shareholders with shares
registered directly with the Company's transfer agent, Norwest Shareowner
Services ("Norwest"), may also vote via the Internet at Norwest's Internet
address, or telephonically. Shareholders holding WCB shares with a brokerage
firm or a bank may also be eligible to vote via the Internet or to vote
telephonically by calling the telephone number referenced on their voting form.
For further information on voting via the Internet or telephonically, see
"Voting Via the Internet or by Telephone" set forth below.
RECENT DEVELOPMENTS
Effective December 31, 1998, the Company's bank subsidiaries (The
Commercial Bank, Bank of Vancouver, and Centennial Bank) were merged into the
continuing bank subsidiary formerly known as The Bank of Newport. As part of
this merger, The Bank of Newport's name was changed to "West Coast Bank." As a
result of this consolidation of the bank subsidiaries ("Consolidation"), all
branches of the previous bank subsidiaries now operate as branches of West Coast
Bank. The Company still operates West Coast Trust as a separate subsidiary.
The Board and management believe that the Consolidation will create
certain efficiencies in operations and enhance customer service.
BUSINESS OF THE MEETING
There are two matters being presented for consideration by the
shareholders at the Annual Meeting.
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
GENERAL
The Company's Restated Articles of Incorporation ("Articles") allow the
Board to set the number of directors on the Board within a range of 8 to 20. The
Board reduced the number of directors from 12 to 11 following the recent
resignation of director Healy, whose term would have expired in the year 2001.
The Articles allow the Board to fill vacancies created on the Board.
Directors are elected for terms of three years or until their successors
are elected and qualified. The Company's Articles provide for staggered terms,
with approximately one-third of the directors elected each year. In addition to
the elected Board, Chester C.
Clark serves as an emeritus director to the Board.
The Board has nominated Victor L. Bartruff, William B. Loch, Michael J.
Bragg and Mary B. Pearmine for election as directors for three-year terms to
expire in the year 2002. Messrs. Bartruff and Loch are presently directors of
the Company, and Mr. Bragg is presently the Chair of the board of directors of
WCT. If any of the nominees should refuse or become unable to serve, your Proxy
will be voted for the person the Board designates to replace that nominee. Mr.
Bragg and Ms. Pearmine are nominated to replace Joe L. Snyder, who resigned from
the Board on March 14, 1999, and Robert D. Morrison, who declined to stand for
re-election to the Board.
Other nominations, if any, may be made only in accordance with the prior
notice provisions contained in the Company's Bylaws. These notice provisions
require that a shareholder provide the Company with written notice at least 60
days before the annual meeting (or, if the Company provides less than 90 days'
public notice of such meeting, no later than 15 days after the date of the
Company's public notice). The Company first provided public notice of its annual
meeting date on March 5, 1999.
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<PAGE> 6
INFORMATION WITH RESPECT TO NOMINEES AND
DIRECTORS WHOSE TERMS CONTINUE
The following tables set forth certain information with respect to the
director nominees and the directors serving current terms. The table below
includes their (1) ages, (2) principal occupations during the past five years,
and (3) year of first election or appointment to the Board. The table also shows
the number of shares of Common Stock beneficially owned by each individual on
December 31, 1998, and the percentage of Common Stock outstanding that the
individual's holdings represented on that date. However, where beneficial
ownership was less than one percent of all outstanding shares, the percentage is
not reflected in the table. Except as noted below, each holder has sole voting
and investment power with respect to shares of Common Stock listed as owned. As
of December 31, 1998, directors of the Company also serve as directors of the
Bank.
<TABLE>
<CAPTION>
SHARES AND
PERCENTAGE OF
COMMON STOCK
PRINCIPAL OCCUPATION BENEFICIALLY
NAME, AGE AND OF DIRECTOR DURING OWNED AS OF
TENURE AS DIRECTOR LAST FIVE YEARS DECEMBER 31, 1998
------------------ -------------------- -----------------
(1)(2)(3)
NOMINEES FOR DIRECTOR FOR THREE YEAR TERM EXPIRING 2002
<S> <C> <C>
Victor L. Bartruff, 51 President and Chief Executive 145,225(4)(5)
Since 1995 Officer of the Company and the (1.01%)
Bank; former President and CEO
of The Bank of Newport
Michael J. Bragg, 49 Attorney at Law and Partner of 14,941(4)(6)
First Nomination Grenley, Rotenberg, Evans,
Bragg & Bodie, P.C.; WCT Board
Chair
William B. Loch, 65 President of Capital City 49,468(4)(6)
Since 1982 Companies, Inc. and Capital
Warehouse Company, Inc.
Mary B. Pearmine, 52 Former Marion County 0(7)
First Nomination Commissioner, serving from
1991 to 1998; former Chair of
the County Commission
</TABLE>
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE
NOMINEES TO BE ELECTED AS DIRECTORS.
<TABLE>
<CAPTION>
DIRECTORS WITH TERM EXPIRING IN 2000
<S> <C> <C>
Lloyd D. Ankeny, 61 Personal Investments, formerly 98,551
Since 1995 Owner, Landmar Development
Corporation
Phillip G. Bateman, 59 President, Bateman Funeral 57,756(4)
Since 1995 Homes, Central Coast
Crematorium and Chelan Abbey
Mausoleum and Columbarium
</TABLE>
3
<PAGE> 7
<TABLE>
<S> <C> <C>
C. Douglas McGregor, 60 Former Chairman, Access Long 27,707
Since 1994 Distance (OR)
James J. Pomajevich, 56 Owner and President, 78,868(6)(8)
Since 1996 Pomajevich Properties, Inc.;
former Chair of Bank of
Vancouver
</TABLE>
<TABLE>
<CAPTION>
DIRECTORS WITH TERM EXPIRING IN 2001
<S> <C> <C>
Jack E. Long, 60 Part Owner/President, J&L 35,211
Since 1990 Nursery Co., Inc.; former
Chair of The Commercial Bank
J. F. Ouderkirk, 48 Attorney, Partner of Ouderkirk 53,170
Since 1995 and Hollen; former Chair of
The Bank of Newport; director
of WTC
Gary D. Putnam, 54 Chair & CEO Superior Electric 33,538
(Board Chair) Construction Co.; former
Since 1995 Executive Vice President/CFO,
Brentwood, Inc., Treasurer/CFO
of Pump & Drilling Supply,
Inc., President, Pacific
Drilling Supply Inc.; director
of WCT
</TABLE>
- ----------------
(1) Shares held directly with sole voting and sole investment power, unless
otherwise indicated.
(2) Share amounts include stock options which are exercisable within 60 days
as follows: Lloyd D. Ankeny 11,837 shares; Victor L. Bartruff 110,313
shares; Phillip G. Bateman 27,952 shares; Michael J. Bragg 9,257 shares;
William B. Loch 11,837 shares; Jack E. Long 16,414 shares; C. Douglas
McGregor 5,487 shares; J.F. Ouderkirk 28,112 shares; James J. Pomajevich
20,856 shares; and Gary D. Putnam 19,324 shares.
(3) Share amounts include shares deferred under the Director's Deferred
Compensation Plan as follows: Lloyd D. Ankeny 1,058 shares; Michael J.
Bragg 501 shares; William B. Loch 1,192 shares; Jack E. Long 3,399
shares; C. Douglas McGregor 4,099 shares; J.F. Ouderkirk 2,592 shares;
James J. Pomajevich 3,679 shares; and Gary D. Putnam 2,827 shares.
(4) Share amount includes shares held in an IRA, 401(k) or Keogh account for
the benefit of the individual as follows: Victor L. Bartruff, 1,760
shares; Michael J. Bragg 1,641 shares; William B. Loch 1,601; and
Phillip G. Bateman 5,241 shares.
(5) Share amount includes 638 shares deferred under the Executive Deferred
Compensation Plan for Mr. Bartruff.
(6) Share amounts include shares owned by the spouses of Michael J. Bragg
3,542 shares; William B. Loch 7,331 shares, and James J. Pomajevich
9,992 shares, each of whom disclaims any beneficial ownership of the
shares.
(7) Under the Company's Corporate Governance Policy, Ms. Pearmine, as a
nominee to the Board, must acquire 100 shares of Company Common Stock
prior to election and must accumulate at least 1,000 shares within the
first three years of being elected a director, in order to be eligible
for nomination to any additional terms.
(8) Shares amounts include shares held by the minor children of James J.
Pomajevich 1,193 shares.
4
<PAGE> 8
INFORMATION REGARDING THE BOARD OF DIRECTORS AND ITS COMMITTEES
The following sets forth information concerning the Board and Committees
of the Company during the fiscal year ended 1998.
BOARD OF DIRECTORS
The Company held 11 Board meetings in 1998. Each director attended at
least 75 percent of the aggregate of (1) the total number of meetings of the
Board and (2) the total number of meetings held by all committees on which he
served.
CERTAIN COMMITTEES OF THE BOARD OF DIRECTORS
The Board has established an Audit and Compliance Committee ("Audit
Committee"), a Compensation Committee and an Executive Committee. When the need
arose the full Board served as the Nominating Committee.
Audit Committee. The main function of the Audit Committee includes
reviewing the plan, scope, and audit results of the independent auditors, as
well as reviewing and approving the services of the independent auditors. The
Audit Committee reviews or causes to be reviewed the reports of bank regulatory
authorities and reports its conclusions to the Board. The Audit Committee also
reviews procedures with respect to the Company's records and its business
practices, and reviews the adequacy and implementation of the internal auditing,
accounting and financial controls. The Committee operates under a formal,
written charter. The Committee held 8 meetings during the year. For fiscal year
1998, members of the Audit Committee consisted of Messrs. Ankeny (Chair),
Bateman, Loch, Pomajevich and Snyder.
In March of 1998, the Board charged the Audit Committee with the special
purpose of reviewing the Company's organizational structure. Mr. Loch was
appointed Vice Chair of the Committee for this purpose. The Committee held 3
meetings during the year related specifically to this purpose.
Compensation Committee. The Compensation Committee met 8 times for the
purposes of reviewing salary and incentive compensation for Mr. Bartruff and
certain other executive officers, and reviewing and recommending to the full
Board stock option grants for executive officers. The Compensation Committee
also met to review and recommend to the full Board the compensation to be paid
by the Company to its directors. For the fiscal year 1998, the Compensation
Committee consisted of Messrs. Loch (Chair), Ankeny, Morrison, and Putnam.
Executive Committee. The main functions of the 1998 Executive Committee
were (1) to establish the agenda for the Company's Board meetings, (2) to
receive reports from the executive officers regarding their activities and the
implementation of the Company's business plan, and (3) to ensure the Company is
appropriately on track and that its strategic planning process is being
followed. The Committee held 12 meetings during the year. For the fiscal year
1998, members of the Executive Committee consisted of Messrs.
McGregor (Chair), Bartruff, Healy, Long, Ouderkirk and Putnam.
New Committee Structure. The Board has changed its committee structure
for 1999. The 1999 committees are (1) the Audit and Compliance Committee, which
serves substantially the same functions as the former Audit Committee; (2) the
Compensation and Personnel Committee, which serves substantially the same
functions as the former Compensation Committee; (3) the Planning Committee; (4)
the Loan, Investment, and Asset/Liability Committee; and (5) the Executive
Committee. The Planning Committee is generally responsible for oversight of
strategic planning, merger and acquisition activities, and general operational
matters. The Loan, Investment, and Asset/Liability Committee is responsible for
oversight of lending
5
<PAGE> 9
activities, CRA compliance, management's investment strategies and activities,
and asset and liability management functions. The 1999 Executive Committee
consists of the Company's Chief Executive Officer, the Board chair, and the
chair of each other Board committee. This Committee is not expected to meet on a
regular basis. Its primary functions are to address emergency matters on behalf
of the full Board, to monitor any material litigation matters that may arise,
and to work with management to resolve other critical issues that may arise
outside the normal course of business.
COMPENSATION OF DIRECTORS
The Company has established a program through which non-employee
directors receive annual retainers as members of the Board; directors also
receive fees for committee participation. In 1998, the Board chair and the
Executive Committee chair each received an annual retainer of $15,000; each
other committee chair and each director received an annual retainer of $12,000.
The Audit Committee chair received $300 for each committee meeting attended in
1998. Each committee member received a fee of $200 for each meeting attended in
1998. For 1999, the Board chair and each committee chair will receive a retainer
of $1,750 per month, and each other director will receive a retainer of $1,500
per month, for their service as directors of both WCB and the Bank. Each
director will receive $200 for each committee meeting they attend in 1999 either
as a member of the committee or at the request of the committee. Mr. Clark
receives $200 for each board meeting he attends.
In 1998, directors of the Company's bank subsidiaries were compensated
in accordance with a similar program commensurate with the size of the
institution and the procedures of their peer banks. The boards of the Company's
former bank subsidiaries were disbanded as of December 31, 1998, as a result of
the Consolidation. On December 31, 1998, the former board of directors of The
Bank of Newport was replaced with a new board for West Coast Bank, consisting of
the same members as the Company's Board. In exchange for signing an agreement
not to compete with the Bank, certain former directors of WCB's bank
subsidiaries were appointed Directors Emeritus of the Bank, as of December 31,
1998. These appointments expire on June 30, 1999. Emeritus Directors do not
attend Bank board meetings unless requested, but may be asked to attend
quarterly business development meetings. These directors receive $200 for each
board meeting they are requested to attend and $100 for each business
development meeting attended. The directors of West Coast Trust receive $400 per
meeting, with the board chair receiving $500 per meeting.
DIRECTORS' DEFERRED COMPENSATION PLAN
The Board adopted a Directors' Deferred Compensation Plan ("Directors'
DCP") which went into effect during the 1996 fiscal year. This plan is open to
all non-employee directors of the Company or its Subsidiaries on a completely
voluntary basis.
Under the Directors' DCP, directors may elect to defer payment of some
or all of their directors' fees. There are no Company paid contributions under
this plan. Contributions are transferred to a so-called "rabbi trust." A
director may invest deferred fees in a number of investment funds. Directors may
also invest deferred fees in Company stock. Distributions will be made after a
director is no longer serving as a director for any of the companies
participating in the Directors' DCP or in the event of an unforeseeable
financial emergency. Directors are fully vested in their benefits under the
Directors' DCP at all times.
Benefit payments from the Directors' DCP are taxed as ordinary income in
the year they are received by participants. The Company will generally receive a
deduction for the deferred directors' fees at that time. ERISA's and the
Internal Revenue Code's onerous tax-qualified plan rules generally do not apply
to this plan.
6
<PAGE> 10
DIRECTORS' STOCK OPTION PLAN
In 1995, the Board adopted and the shareholders approved a Director
Stock Option Plan ("1995 DSOP"), which was subsequently amended in 1997. The
1995 DSOP authorizes the Board (or a committee of the Board) to administer the
1995 DSOP and to grant nonqualified stock options to directors of the Company.
At the 1997 annual shareholders' meeting, the 1995 DSOP was amended to allow the
Board, in accordance with Section 16 of the Securities Act of 1934, to grant
options to purchase shares of the Company's Common Stock in the Board's
discretion (rather than pursuant to a pre-authorized schedule) to directors of
the Company and its Subsidiaries. The 1995 DSOP provides that the exercise price
of options granted under the 1995 DSOP must be not less than the greater of book
value or market value at the time of grant. All options granted under the 1995
DSOP will expire not more than ten years from the date of grant. Up to 660,000
shares of the Company's Common Stock may currently be optioned and issued under
the 1995 DSOP, subject to appropriate adjustments for any future stock splits,
stock dividends, or other changes in the capitalization of the Company. Of those
shares, 212,990 remain available for option under future grants.
EXECUTIVE COMPENSATION
The following table sets forth a summary of certain information
concerning compensation awarded to or paid by the Company for services rendered
in all capacities, during the last three fiscal years to the Chief Executive
Officer and to the four most highly compensated executive officers of the
Company and its Subsidiaries, whose total compensation during the last fiscal
year exceeded $100,000.
7
<PAGE> 11
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
==========================================================================================================
LONG TERM
ANNUAL COMPENSATION COMPENSATION
----------------------------------- AWARDS
OTHER ----------------
NAME AND ANNUAL LTIP ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS PAYOUTS COMPENSATION
(1) (2) (3)
- -------------------- ------- ----------- --------- -------------- -------- -------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Victor L. Bartruff, 1998 $ 220,000 $ 77,000 $ 0 15,000 0 $ 13,087(5)
President and CEO 1997 165,000 82,500 34,590(4) 12,375 0 10,790
of the Company and 1996 150,000 60,000 0 10,312 0 10,262
Bank*
- -------------------- ------- ----------- --------- -------------- -------- -------- ---------------
Thomas W. Healy, 1998 $ 208,331(6) $ 46,000 $82,776(6) 2,000 0 $347,198(6)
Director, former
CEO of Centennial
Bank**
- -------------------- ------- ----------- --------- -------------- -------- -------- ---------------
Donald A. Kalkofen 1998 $135,015 $67,500 0 9,599 0 $ 6,060(7)
EVP/CFO of the 1997 116,378 67,000 0 8,250 0 4,693
Company and Bank 1996 100,200 40,080 0 8,250 0 4,026
- -------------------- ------- ----------- --------- -------------- -------- -------- ---------------
Cyndi Haworth, 1998 $95,004 $37,000 0 9,599 0 $ 3,821(8)
EVP/Human Resources 1997 79,920 32,000 0 5,755 0 4,747
Administration of 1996 70,800 21,240 0 5,755 0 2,704
the Company and
Bank*
- -------------------- ------- ----------- --------- -------------- -------- -------- ---------------
Rodney B. Tibbatts 1998 $100,000 $24,000 0 0 0 $ 6,171(9)
EVP/Corporation 1997 125,000 15,000 0 3,300 0 8,496
Development 1996 150,000 37,500 0 10,312 0 7,994
==========================================================================================================
</TABLE>
* Reflects the current positions subsequent to the Consolidation.
** As a result of the Consolidation, Mr. Healy retired from his position
with the Company in December 1998. Mr. Healy resigned as a director of
the Company and the Bank on March 12, 1999.
(1) Represents bonuses earned during the year indicated but paid in a
subsequent year only; does not include bonuses earned in a subsequent year
and paid in the year indicated.
(2) Does not include amounts attributable to miscellaneous benefits received
by executive officers, including the use of company-owned automobiles and
the payment of certain club dues. In the opinion of management, the costs
to the Company of providing such benefits to any individual executive
officer during the year ended December 31, 1998 did not exceed the lesser
of $50,000 or 10% of the total of annual salary and bonus reported for the
individual
(3) Options to acquire shares of Common Stock as adjusted for subsequent stock
dividends and stock splits.
(4) Includes a one-time payment made by the Company on behalf of Mr. Bartruff
of $33,000 for a golf club membership to be used primarily for business
development purposes.
(5) Includes 401(k) Plan contribution in the amount of $5,000, life insurance
premium in the amount of $3,948, and 401(k) Plan contribution in the
amount of $4,139 deferred pursuant to the Company's Executive DCP, paid by
the Company on behalf of Mr. Bartruff for the year ended 1998.
(6) Mr. Healy's salary amount of $208,331 includes the aggregate of $58,331
(representing payments of $8,333 for seven months, paid by the Company to
Mr. Healy, pursuant to his employment letter agreement, as described in
more detail below), deferred pursuant to the Company's Executive DCP. The
amount of $82,776 represents a severance payment made to Mr. Healy upon
termination, paid on January 4, 1999. The amount of $347,198 includes
401(k) contributions in the amount of $5,000 and $532, respectively, and
an additional $341,666, representing the amounts accrued through February
1998 of $312,500 at Centennial
8
<PAGE> 12
Bank for Mr. Healy's retirement, plus an additional $29,166 accrued by
the Company for Mr. Healy for March, April, and May 1998 under the
employment letter agreement detailed below. The total amount of $336,711
($341,666 less $4,954 paid by Mr. Healy for FICA tax) was deferred
pursuant to the Company's Executive DCP.
(7) Includes 401(k) Plan contribution in the amount of $4,050 and 401(k) Plan
contribution in the amount of $2,010 deferred pursuant to the Company's
Executives' DCP, paid by the Company on behalf of Mr. Kalkofen.
(8) Includes 401(k) Plan contribution in the amount of $3,821 paid by the
Company on behalf of Ms. Haworth for the year ended 1998.
(9) Includes 401(k) Plan contribution in the amount of $3,473 and life
insurance premium in the amount of $3,244, paid by the Company on behalf
of Mr. Tibbatts for the year ended 1998.
STOCK OPTIONS
Option Grants. The following table sets forth certain information
concerning individual grants of stock options under the stock option plans to
the named executive officers during the year ended December 31, 1998.
<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
===========================================================================================================
POTENTIAL REALIZABLE
VALUE AT
ASSUMED ANNUAL RATES
OF STOCK PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(1)
- ------------------------------------------------------------------------------- -------------------------
% OF TOTAL
OPTIONS
OPTIONS GRANTED TO EXERCISE EXPIRATION
NAME GRANTED(2) EMPLOYEES PRICE(3) DATE 5% 10%
- ---------------------- ----------- ------------ ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Victor L. Bartruff 3,960 1.59 $21.48 6/25/08 $53,488 $135,548
7,040 2.83 21.48 6/25/08 95,089 240,974
4,000 1.61 18.56 10/29/08 46,697 118,339
- ---------------------- ----------- ------------ ----------- ----------- ----------- -----------
Thomas W. Healy 2,000(4) 0.81 $18.56 10/29/08 $23,348 $ 59,169
- ---------------------- ----------- ------------ ----------- ----------- ----------- -----------
Donald A. Kalkofen 4,427 1.78 $21.48 6/25/08 $59,795 $151,533
2,172 0.87 21.48 6/25/08 29,337 74,346
3,000 1.21 18.56 10/29/08 35,023 88,754
- ---------------------- ----------- ------------ ----------- ----------- ----------- -----------
Cynthia J. Haworth 4,427 1.78 $21.48 6/25/08 $59,795 $151,533
2,172 0.87 21.48 6/25/08 29,337 74,346
3,000 1.21 18.56 10/29/08 35,023 88,754
- ---------------------- ----------- ------------ ----------- ----------- ----------- -----------
Rodney B. Tibbatts 0 0 0 0 0 0
===========================================================================================================
</TABLE>
(1) The potential realizable value is based on the assumption that the stock
price of the Common Stock appreciates at the annual rate shown (compounded
annually) from the date of grant until the end of the ten-year option term.
These numbers are calculated based on the requirements of the Securities
and Exchange Commission and do not reflect the Company's estimate of future
stock price performance.
(2) The Company's stock option plan is administered by a Committee of the Board
of Directors, which determines to whom options are granted, as well as the
number of shares and the exercise price. Options are granted at the fair
market value, vest over a period of time, and are exercisable for ten
years. Options may be exercised for a period of 90 days following
termination of employment and for one year following death or disability.
9
<PAGE> 13
(3) The option exercise price may be paid in cash or by surrendering for
cancellation mature shares of Common Stock owned by the executive officer
or a combination of the foregoing.
(4) This option was granted on October 29, 1998, but does not vest until
October 29, 1999. Since Mr. Healy is no longer a director, this option will
expire before it becomes exercisable.
Option Exercises. The following table sets forth certain information
concerning exercises of stock options under the stock option plans by the named
executive officers during the year ended December 31, 1998 and stock options
held at year end.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND YEAR END OPTION VALUES
<TABLE>
<CAPTION>
===================================================================================================
SHARES
ACQUIRED NUMBER OF VALUE OF
ON VALUE UNEXERCISED UNEXERCISED OPTIONS AT
NAME EXERCISE REALIZED(1) OPTIONS AT YEAR END YEAR END(2)
- --------------------- ---------- ----------- --------------------------- --------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------- ---------- ----------- ------------ -------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Victor L. Bartruff 4,000 $71,652 110,313 4,000 $1,489,078 $9,748
- --------------------- ---------- ----------- ------------ -------------- ----------- -------------
Thomas W. Healy 0 0 0 2,000 0 4,874
- --------------------- ---------- ----------- ------------ -------------- ----------- -------------
Donald A. Kalkofen 1,145 13,007 55,300 3,000 635,962 7,311
- --------------------- ---------- ----------- ------------ -------------- ----------- -------------
Cynthia J. Haworth 0 0 42,314 3,000 471,272 7,311
- --------------------- ---------- ----------- ------------ -------------- ----------- -------------
Rodney B. Tibbatts 44,568 582,603 28,130 0 399,121 0
===================================================================================================
</TABLE>
(1) Reflects the amount realized from the aggregate of the current market
price of the Common Stock less the exercise price.
(2) On December 31, 1998, the closing price of the Common Stock was $21. For
purposes of the foregoing table, stock options with an exercise price
less than that amount are considered to be "in-the-money" and are
considered to have a value equal to the difference between this amount
and the exercise price of the stock option multiplied by the number of
shares covered by the stock option.
EMPLOYMENT ARRANGEMENTS
Salary Continuation Agreement - Thomas W. Healy. In connection with the
acquisition of Centennial Holdings, Ltd. ("CHL"), the Company entered into a
Salary Continuation Agreement with Thomas W. Healy, for a term of one year from
the date of the merger, with automatic one-year extensions unless the parties
provide prior written notice of non-renewal. The agreement provided for a
payment to Mr. Healy in the event of a change in control of the Company or
Centennial Bank. Mr. Healy has subsequently retired from his position with
Centennial Bank, and the Salary Continuation Agreement is no longer in effect.
Employment Letter - Thomas W. Healy. The Company also entered into a
letter agreement with Mr. Healy, in connection with its acquisition of
Centennial Bank. The letter agreement provided, among other things, that
regardless of whether Mr. Healy continued his employment with Centennial Bank,
the Company would either pay to him or contribute $8,333 per month on his behalf
to the Company's Executive DCP, until he reaches age 65. This agreement was made
to allow Mr. Healy to continue to receive a retirement benefit similar to the
one available to him from Centennial Bank before the acquisition. The Company
continues to make these payments to Mr. Healy.
10
<PAGE> 14
SALARY CONTINUATION AGREEMENTS
The Company, and as applicable, its Subsidiaries, have entered into
salary continuation agreements with certain executive officers. Under these
agreements, the executive is entitled to receive a salary continuation payment
if his employment is terminated (i) by the executive for good reason, following
a change in control (as defined); (ii) by the Company, without cause, following
a change in control; or (iii) by the Company, without cause, resulting from a
contemplated change in control. The amount of the salary continuation payment is
based on the executive's salary at the date of termination and his or her most
recent bonus. This payment is a lump sum payment equal to executive's base
salary and bonus over a period of 24 months following the termination event (as
defined) for Messrs. Bartruff, Tibbatts and DeLude, and for a period of 18
months for Mr. Kalkofen, and for a period of 12 months for certain other
executives including Ms. Haworth.
DEFERRED COMPENSATION PLANS
Effective January 1, 1996, the Company adopted an Executives' Deferred
Compensation Plan ("Executives' DCP"), which is open only to executives of the
Company and its Subsidiaries, who are designated by the Board of the Company.
Participants may elect to defer payment of a specified portion of their
salary and bonus. The amount of participants' annual deferral contributions is
unlimited. In addition, the Company will contribute the amount, if any, that the
executives cannot receive under the 401(k) Plan because of the deferral
limitations under IRS regulations. Employer contributions will be subject to the
same vesting schedule as under the 401(k) Plan. Contributions are transferred to
a so-called "rabbi trust." Distributions will be made in accordance with
individual elections by participants. Participants are fully vested in their
portion of contributions under the Executives' DCP at all times.
Benefits under the Executives' DCP will be taxed to participants as they
receive them after termination of employment. The Company will receive a
deduction for its contributions generally at that time. ERISA's and Internal
Revenue Code's onerous tax-qualified plan rules generally do not apply to this
plan.
BONUS COMPENSATION PLANS
The Company and its Subsidiaries have adopted bonus compensation plans
to provide incentive bonuses for are eligible employees. Under the bonus
compensation plans, participants receive additional compensation based on the
Company's and the Subsidiaries levels of profitability and employees' individual
goals.
401(K) PLAN
The Company maintains a 401(k) profit sharing plan ("401(k) Plan") which
is qualified for special tax treatment under Section 401(k) of the Internal
Revenue Code, to provide for a single retirement plan to cover all employees of
the Company, including all of its present and future subsidiaries.
The 401(k) Plan allows for pre-tax employee contributions up to IRS
maximum limits with a Company match of 50% of the first 6% of employee
contribution. The Company may also make an additional discretionary contribution
to qualifying employees. Employee elective contributions are 100% vested at all
times. Matching and discretionary contributions have a five-year vesting
schedule. These contributions vest
11
<PAGE> 15
20% per year, beginning at the end of the first year. Employees must complete at
least 1,000 hours of service in a given year to receive vesting for that year.
As a result of the tax qualification of the 401(k) Plan, employees are
not subject to federal or state income taxation on the employee elective
contributions, employer contributions or earnings thereon until those amounts
are distributed from the 401(k) Plan, although the Company continues to receive
a compensation expense deduction for compensation paid.
EMPLOYEE STOCK OPTION PLANS
Description of Stock Option Plans. The Company currently maintains a
Combined 1991 Incentive Stock Option Plan and 1991 Nonqualified Stock Option
Plan ("1991 Plan") for key employees of the Company and its Subsidiaries. The
Company has also inherited several option plans through acquisitions, from which
options are no longer granted, but which serve merely as a vehicle to allow
those employees who had options outstanding at the time of the acquisition, to
continue to hold, and, eventually exercise their options. At December 31, 1998,
the Company had outstanding granted and unexercised options to purchase an
aggregate of 840,624 shares of Common Stock under the various employee stock
option plans.
The 1991 Plan, which will expire in 2001, currently provides for the
grant of options to purchase up to 2% of the shares of Common Stock of the
Company issued and outstanding on January 1 of each year. The Board has
determined it advisable to adopt the 1999 Stock Option Plan which, among other
things, will establish a fixed maximum number of shares available for issuance
under the plan. Accordingly, as described below under "Proposal No. 2 - Adoption
of 1999 Stock Option Plan," at the 1999 Annual Meeting, the shareholders will be
asked to approve the adoption of a new plan that will replace the existing 1991
Plan.
Stock Repurchase Program. On December 2, 1998, the Company adopted a
stock repurchase program that allows for the repurchase of up to 1,500,000
shares of the Company's Common Stock through open market transactions, block
purchases, or through privately negotiated transactions. The plan repurchases
are limited by the anticipated timing of stock option exercises, as well as by
other factors. The repurchased common shares will be available for use under the
Company's stock option plans.
REPORT ON EXECUTIVE COMPENSATION
The following is a report of the non-employee members of the
compensation committee of the Board ("Committee") who are responsible for
establishing and administering the Company's Executive Compensation Program. The
following report (and members thereof) is specific to matters relating to
compensation during the fiscal year 1998. Although members who comprise the
Committee may change, the Company intends to apply the same philosophy and
objectives in the coming years as it has previously to determine compensation
for its executive officers.
Compensation Philosophy and Objectives. The philosophy underlying the
development and administration of the Company's annual and long-term
compensation plans is the alignment of the interests of executive management
with those of the shareholders. Key elements of this philosophy are:
* Establish compensation plans that deliver pay commensurate with
the Company's performance, as measured by operating, financial
and strategic objectives,
12
<PAGE> 16
* Provide significant equity-based incentives for executives to
ensure that they are motivated over the long-term to respond to
the Company's business challenges and opportunities as owners,
rather than just as employees,
* Reward executives if shareholders receive an above-average return
on their investment over the long-term.
The objective for computing executive base salaries is to structure
salaries that are competitive within the marketplace. An incentive bonus is the
vehicle through which executives can earn additional compensation depending on
individual and Company performance relative to certain annual objectives. The
Company objectives are a combination of operating, financial and strategic goals
(such as loan and deposit levels, asset quality, earnings per share, operating
income, efficiency ratio, etc.) that are considered to be critical to the
Company's fundamental goal - building shareholder value.
The Company's long-term incentive program consists of the 1991 Combined
Incentive and Non-Qualified Stock Option Plan. Annual grants are considered at
the then value of the Company's Common Stock, thereby providing an additional
incentive for executives to build shareholder value. Options granted in 1998
under the stock option plan have a term of 10 years. Executives receive value
from these grants if strategic goals are achieved and the Company's Common Stock
appreciates.
Company Performance and Compensation. Compensation for the current year
is based upon performance for the prior year. During 1998, the Company met or
exceeded its strategic, operating and financial goals for asset quality, and
operating income. Considering these accomplishments, which were not specifically
weighted, the Board awarded the Company's President and CEO, Victor L. Bartruff,
an incentive bonus payment. In addition, the Board increased his base salary by
3%. Despite this increase, Mr. Bartruff's base salary remains comparable to or
less than salaries generally paid by the Company's peer banks to their CEO's.
As an incentive for future performance and because the Company's
performance ratios compared favorably with publicly traded western U.S. banks,
the Board granted Mr. Bartruff stock options for 10,000 shares. This award
provides an incentive for Mr. Bartruff to continue to build shareholder value
over the long-term. Mr. Bartruff was granted stock options for 4,000 additional
shares as an incentive to implement the Consolidation; these options vest in
full one-year from the date of grant. In making these awards, the Board did not
consider prior grants or stock options.
13
<PAGE> 17
STOCK PERFORMANCE GRAPH
The following chart compares the yearly percentage change in the
cumulative shareholder return on the Company's Common Stock during the five
fiscal years ended December 31, 1998, with (1) the Total Return Index for the
NASDAQ Stock Market (U.S. Companies) as reported by the Center for Research in
Securities Prices and (2) the Total Return Index for NASDAQ Bank Stocks as
reported by the Center for Research in Securities Prices. This comparison
assumes $100.00 was invested on December 31, 1993, in the Company's Common Stock
and the comparison groups and assumes the reinvestment of all cash dividends
prior to any tax effect, and retention of all stock dividends.
[GRAPH]
<TABLE>
<CAPTION>
PERIOD ENDING
---------------------------------------------------------------
Index 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
West Coast Bancorp 100.00 101.97 130.53 180.37 381.01 351.59
NASDAQ - Total US 100.00 97.75 138.26 170.01 208.58 293.21
NASDAQ Bank Index 100.00 99.64 148.38 195.91 328.02 324.90
</TABLE>
14
<PAGE> 18
PROPOSAL NO. 2 - ADOPTION OF EMPLOYEE STOCK OPTION PLAN
As discussed above, the Company has maintained the 1991 Plan for the
benefit of key employees of the Company and its Subsidiaries. As described under
"Employee Stock Option Plans," the 1991 Plan currently requires that the plan be
automatically adjusted at the beginning of each year to cause the number of
shares available for issuance under the 1991 Plan to be increased to an amount
equal to 2% of the shares issued and outstanding. This automatic adjustment
factor has caused certain restrictions in structuring employee grants, as well
as creating certain difficulties in maintaining the plan. Therefore, after
discussions with the Company's accountants and legal counsel, the Board has
determined it advisable to discontinue using the current 1991 Plan, and propose
the adoption of a new 1999 Stock Option Plan.
In February 1999, the Board of Directors adopted the new 1999 Stock
Option Plan (the "1999 Plan"), subject to shareholder approval at the 1999
Annual Meeting. The Board of Directors unanimously recommends that the
shareholders adopt the 1999 Plan. The purpose of the 1999 Plan is to establish a
fixed maximum number of shares available for future option grants and to provide
flexibility in granting options. The material features of the 1999 Plan are
summarized below.
Participants. Employees of the Company and its Subsidiaries are eligible
to participate in the 1999 Plan. The Board or the appointed Committee determines
which employees should be granted options under the 1999 Plan. The Board makes
this determination by evaluating the Company's strategic plan and goals, along
with the role of employees in the pursuit of that plan and those goals and the
employee's expected performance. The 1999 Plan also allows the Company to grant
nonqualified stock options to non-employee consultants.
Administration of the Plan. The 1999 Plan will be administered by the
Board of Directors (or a committee of the Board). It will allow additional stock
options to be granted in any combination up to an aggregate of 1,500,000 shares
of Company Common Stock, subject to appropriate adjustments for any stock
splits, stock dividends, or other changes in the capitalization of the Company.
Grant of Options. The 1999 Plan provides for the issuance of options
which qualify as "incentive stock options" within the meaning of Section 422 of
the Internal Revenue Code of 1986, and also for the issuance of nonqualified
stock options. Both of these types of stock options presently may be granted
under the existing 1991 Plan.
Federal Tax Treatment. Holders of incentive stock options incur no tax
(and the Company is not entitled to a deduction) on the grant or exercise of
such options. When stock received upon exercise of an incentive stock option is
sold, the holder incurs tax on the difference between the sale price and the
exercise price of the options. Capital gains rates, would apply, provided
certain holding period requirements are met. In order to qualify under Section
422, incentive stock options are subject to a number of restrictions, including
the following:
o The option price may not be less than the fair market value of
the stock at the time the option is granted.
o The market value of the stock for which an employee's incentive
stock options become exercisable in any year may not exceed
$100,000.
15
<PAGE> 19
The holder of a nonqualified stock option incurs no tax on the date of
grant of such option. On the date of exercise, the holder is taxed on the
difference between the exercise price and the fair market value of the stock
subject to the option, measured at the date of exercise. The income is taxable
at ordinary income rates and is deductible by the Company. The exercise price of
nonqualified options granted under the 1999 Plan may be at or below market
price.
Term of Plan and Options. All options granted under the 1999 Plan will
expire not more than ten years from the date of grant. The Board of Directors
would have the authority to terminate the 1999 Plan at any time. The 1999 Plan
may be amended by the Board of Directors without shareholder approval, except
that no such amendment may (i) increase the number of shares that may be issued
pursuant to the 1999 Plan, or (ii) change the class of employees who may be
granted options, without shareholder approval.
All unexercised options under the existing 1991 Plan will remain
outstanding for their respective terms. Upon shareholder approval of the 1999
Plan, the existing 1991 Plan will be terminated and no further options will be
granted under that plan. Approval of the 1999 Plan requires the affirmative vote
of shareholders owning a majority of the Company's Common Stock present, in
person or by proxy, at the Annual Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR APPROVAL
OF THE 1999 STOCK OPTION PLAN.
16
<PAGE> 20
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table provides information as of December 31, 1998, with
respect to the shares of Common Stock beneficially owned by (i) the non-director
executive officers named in the compensation table; (ii) all executive officers
and directors of the Company as a group; and (iii) each person known to the
Company to beneficially own more than five percent of its outstanding Common
Stock. Except as noted below, each holder has sole voting and investment power
with respect to shares of Common Stock listed as owned.
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
CURRENT POSITION
WITH THE COMPANY AND PRIOR SHARES AND PERCENTAGE
FIVE YEAR BUSINESS OF COMMON STOCK
NAME AND AGE EXPERIENCE* BENEFICIALLY OWNED**(1)
- ------------ --------------------------- -----------------------
<S> <C> <C>
Donald A. Kalkofen, (35) EVP and CFO of the Company 57,836
and the Bank; SVP and CFO
of the Company from 1993
to 1995; SVP and CFO of
Bank from 1993
Cynthia J. Haworth, (46) EVP/Human Resources 44,798
Administration of the
Company and the Bank;
former Senior Vice
President of the Company,
Commercial Bank and Bank
Rodney B. Tibbatts, 59 Executive Vice 54,506 (2)
President/Corp Development
of the Company; director
of WCT; former director
and Co-President and
Co-CEO the Company; former
President and CEO of
Commercial Bancorp
Executive officers and directors as
a group (19 individuals) 1,698,731 (3)
(11.59)%
</TABLE>
* Reflects the current positions with the Company or it Subsidiaries,
subsequent to the Consolidation.
** Unless otherwise noted, all shares owned represent less than one percent.
(1) Share amounts include options which are exercisable within 60 days as
follows: Donald A. Kalkofen 55,300 shares, Cynthia J. Haworth, 42,314
shares, Rodney B. Tibbatts 28,130 shares, directors and executive officers
as a group 422,792 shares.
(2) Includes 25,547 shares held by Mr. Tibbatt's spouse.
(3) Share amount represents stock ownership of those individuals who, at
December 31, 1998, were directors or executive officers of the Company.
17
<PAGE> 21
5% BENEFICIAL OWNERS
<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE OF
SHARES OF OUTSTANDING
NAME AND ADDRESS COMMON STOCK COMMON STOCK
- ---------------- ------------ -------------
<S> <C> <C>
Thomas W. Healy 91,227(1) 5.56%
</TABLE>
(1) Includes 16,826 shares held in the Company's 401(k) Plan and 78,091 shares
held by Puget Sound Capital Corporation, of which Thomas W. Healy is the
owner.
MANAGEMENT
The following table sets forth information with respect to executive
officers who are not directors or nominees for director of the Company, and are
not otherwise named in the compensation table. The information below reflects
the current positions with the Company or it Subsidiaries, subsequent to the
Consolidation.
<TABLE>
<CAPTION>
CURRENT POSITION WITH THE COMPANY AND
NAME AND AGE PRIOR FIVE YEAR BUSINESS EXPERIENCE
------------ -----------------------------------------
<S> <C>
Ronald DeLude, 62 EVP/Chief Operating Officer of Company
and Bank; former President and CEO of
Bank of Vancouver; former SVP/Manager
Western Bank
Adeline C. Hesse, 54 SVP/Marketing Director of the Company and
the Bank; previously held same position
with Commercial Bank since 1994
David Prysock, 55 EVP and Chief Credit Officer; former EVP
of The Commercial Bank
Shauna L. Vernal, 29 VP, General Counsel, and Corporate
Secretary of the Company and Bank;
formerly, attorney in private practice
</TABLE>
TRANSACTIONS WITH MANAGEMENT
Various of the directors and officers of the Company, members of their
immediate families, and firms in which they had an interest were customers of
and had transactions with the Subsidiaries during 1998 in the ordinary course of
business. Similar transactions may be expected to take place in the ordinary
course of business in the future. All outstanding loans and commitments included
in such transactions were made on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable
transactions with other persons and did not, in the opinion of management,
involve more than the normal risk of collectibility nor present other
unfavorable features.
18
<PAGE> 22
COMPLIANCE WITH SECTION 16(a) FILING REQUIREMENTS
Section 16(a) of the Securities Exchange Act of 1934, as amended,
("Section 16(a)") requires that all executive officers and directors of the
Company and all persons who beneficially own more than 10 percent of the
Company's Common Stock file reports with the Securities and Exchange Commission
with respect to beneficial ownership of the Company's Securities. The Company
has adopted procedures to assist its directors and executive officers in
complying with the Section 16(a) filings.
Based solely upon the Company's review of the copies of the filings
which it received with respect to the fiscal year ended December 31, 1998, or
written representations from certain reporting persons, the Company believes
that all reporting persons made all filings required by Section 16(a) on a
timely basis, except that Joe L. Snyder inadvertently failed to timely file a
Form 4 with respect to the sale of 12,000 shares on November 18, 1998.
This report was subsequently filed.
AUDITORS
Arthur Andersen, LLP, independent certified public accountants,
performed the audit of the consolidated financial statements for the Company and
its wholly-owned subsidiaries, the Bank, WCT, Totten, Inc. and Centennial
Funding Corporation for the year ended December 31, 1998. Representatives of
Arthur Andersen, LLP will be present at the Annual Meeting, and will have the
opportunity to make a statement if they so desire. They also will be available
to respond to appropriate questions.
OTHER BUSINESS
The Board knows of no other matters to be brought before the
shareholders at the Annual Meeting. In the event other matters are presented for
a vote at the Annual Meeting, the proxy holders will vote shares represented by
properly executed proxies in their discretion in accordance with their judgment
on such matters.
At the Annual Meeting, management will report on the Company's business
and shareholders will have the opportunity to ask questions.
INFORMATION CONCERNING SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 2000 annual
shareholder's meeting must be received by the Secretary of the Company before
November 23, 1999, for inclusion in the 2000 Proxy Statement and form of proxy.
In addition, if the Company receives notice of a shareholder proposal after
February 6, 2000, the persons named as proxies in such proxy statement and form
of proxy will have discretionary authority to vote on such shareholder proposal.
ANNUAL REPORT TO SHAREHOLDERS
ANY SHAREHOLDER MAY OBTAIN WITHOUT CHARGE A COPY OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-K FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE YEAR ENDED DECEMBER 31, 1998, INCLUDING
FINANCIAL STATEMENTS. Written requests for the Form 10-K should be addressed to
Shauna L. Vernal, Secretary to the Board of West Coast Bancorp, at 5335 Meadows
Road, Suite 201, Lake Oswego, OR 97035.
19
<PAGE> 23
VOTING VIA THE INTERNET OR BY TELEPHONE
FOR SHARES DIRECTLY REGISTERED IN THE NAME OF THE SHAREHOLDER.
Shareholders with shares registered directly with Northwest may vote
telephonically by calling Norwest at (800)240-6326 or you may vote via the
Internet at the following address on the World Wide Webb:
www.eproxy.com/wcbo/.com
FOR SHARES REGISTERED IN THE NAME OF A BROKERAGE FIRM OR BANK. A number
of brokerage firms and banks are participating in a program provided through ADP
Investor Communication Services that offers telephone and Internet voting
options. This program is different than the program provided by Norwest for
shares registered in the name of the shareholder. If your shares are held in an
account at a brokerage firm or bank participating in the ADP program, you may
vote those shares telephonically by calling the telephone number referenced on
your voting form. If your shares are held in an account at a brokerage firm or
Bank participating in the ADP program, you already have been offered the
opportunity to elect to vote via the Internet. Votes submitted via the Internet
through the ADP program must be received by 12:00 p.m. (noon) (EDT) on April 22,
1999. The giving of such proxy will not effect your right to vote in person
should you decide to attend the Annual Meeting.
The telephone and Internet voting procedures are designed to
authenticate shareholders identities, to allow shareholders to give their voting
instructions and to confirm that shareholders' instructions have been recorded
properly. Shareholders voting via the Internet through either Norwest or ADP
Investor Communication Services should understand that there may be costs
associated with electronic access, such as usage charges from Internet access
providers and telephone companies, that must be borne by the shareholder.
March 23, 1999 BY ORDER OF THE BOARD OF DIRECTORS
Shauna L. Vernal, Secretary
20
<PAGE> 24
WEST COAST BANCORP
1999 STOCK OPTION PLAN
1. PURPOSE OF THE PLAN. The purpose of this 1999 Stock Option Plan ("Plan")
is to provide additional incentives to key employees and service
providers of West Coast Bancorp ("Bancorp") and any of its existing or
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 Bancorp. Bancorp intends that Options issued under this
Plan will constitute either Incentive Stock Options within the meaning
of Section 422 of the Code or Nonqualified Stock Options.
2. DEFINITIONS. As used in this Plan, the following definitions apply:
a. "1934 Act" means the Securities Exchange Act of 1934, as amended.
b. "Bancorp" has the meaning set forth in paragraph 1 of this Plan.
c. "Board" means the Board of Directors of Bancorp.
d. "Code" means the Internal Revenue Code of 1986, as amended.
e. "Common Stock" means Bancorp's common stock, currently with no
par value.
f. "Committee" has the meaning set forth in subparagraph 4(a) of
this Plan.
g. "Continuous Status as Employee" means 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.
h. "Date of Grant" of an Option means the date on which the
Committee makes the determination granting such Option, or such
later date as the Committee may designate. The Date of Grant
shall be specified in the Option agreement.
i. "Employee" means any person employed by Bancorp, or a Subsidiary
of Bancorp which is currently in existence or is hereafter
organized or is acquired by Bancorp.
j. "Exercise Price" has the meaning set forth in subparagraph
4(b)(2) of this Plan.
k. "Option" means a stock option granted under this Plan. Options
shall include both Incentive Stock Options as defined under
Section 422 of the Code and Nonqualified Stock Options, which
refer to all stock options other than Incentive Stock Options.
l. "Optionee" means an Employee or Service Provider who receives an
Option.
m. "Plan" has the meaning set forth in paragraph 1 of this Plan.
n. "Service Provider" means any person who provides services to
Bancorp, or a Subsidiary of Bancorp which is currently in
existence or is hereafter organized or is acquired by Bancorp,
under contract or other agreement with Bancorp or a Subsidiary.
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o. "Shareholder-Employee" means an Employee who owns stock
representing more than ten percent (10%) of the total combined
voting power of all classes of stock of Bancorp or of any
Subsidiary or parent company. For this purpose, the attribution
of stock ownership rules provided in Section 424(d) of the Code
shall apply.
p. "Subsidiary" means any corporation of which not less than fifty
percent (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.
3. STOCK SUBJECT TO OPTIONS.
a. Number of Shares Reserved. The maximum number of shares which may
be optioned and sold under this Plan is 1,500,000 shares of the
Common Stock of Bancorp (subject to adjustment as provided in
subparagraph 6(j) of this 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 this 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 will again become available for other
Options.
4. ADMINISTRATION OF THE PLAN.
a. The Committee. The Board will administer this Plan 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. If a separate
Committee is appointed, the chairman of the Board will appoint
one of the Committee members as the chairman of the Committee.
All references in the Plan to the "Committee" refers to this
separate Committee, if any is established, or if none is then in
existence, refers to the Board as a whole. Once appointed, any
Committee will 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, remove members (with or
without cause), appoint new members in substitution, and fill
vacancies however caused. The Committee will hold meetings at
such times and places as the chairman or a majority of the
Committee may determine. At all times, the Board will have the
power to remove all members of the Committee and thereafter to
directly administer this Plan as a Committee of the whole.
(1) Members of the Committee who are eligible for Options or
who have been granted Options will be counted for all
purposes in determining the existence of a quorum at any
meeting of the Committee and will be eligible to vote on
all matters before the Committee respecting the granting
of Options or administration of this Plan.
(2) At least annually, the Committee must present a written
report to the Board indicating the persons to whom Options
have been granted since the date of the last such report,
and in each case the Date of Grant, the number of shares
optioned, and the per-share Exercise Price.
b. Powers of the Committee. All actions of the Committee must be
either (i) by 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. All decisions, determinations and interpretations of the
Committee will be final and binding on all persons, including all
Optionees and any other holders or persons interested in any
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Options, unless otherwise expressly determined by a vote of the
majority of the entire Board. No member of the Committee or of
the Board will be liable for any action or determination made in
good faith with respect to the Plan or any Option. Subject to all
provisions and limitations of the Plan, the Committee will have
the authority and discretion:
(1) to determine the persons to whom Options are to be
granted, the Dates of Grant, and the number of shares to
be represented by each Option;
(2) to determine the price at which shares of Common Stock are
to be issued under an Option, subject to subparagraph 6(b)
of this Plan ("Exercise Price");
(3) to determine all other terms and conditions of each Option
granted under this Plan (including specification of the
dates upon which Options become exercisable, and whether
conditioned on performance standards, periods of service
or otherwise), which terms and conditions can vary between
Options;
(4) to modify or amend the terms of any Option previously
granted, or to grant substitute Options, subject to
subparagraphs 6(l) and 6(m) of this Plan and approval of
the Optionee when required;
(5) 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 effect the
grant of Options by the Committee;
(6) to interpret this Plan and to make all other
determinations and take all other actions which the
Committee deems necessary or appropriate to administer
this Plan in accordance with its terms and conditions.
5. ELIGIBILITY. Options may be granted to Employees and Service Providers,
except that Incentive Stock Options may be granted only to Employees.
Granting of Options under this Plan will be entirely discretionary with
the Committee. Adoption of this Plan will not confer on any Employee or
Service Provider any right to receive any Option or Options under this
Plan unless and until said Options are granted by the Committee in its
sole discretion. Neither the adoption of this Plan nor the granting of
any Options under this Plan will confer upon any Employee any right with
respect to continuation of employment, nor will the same interfere in
any way with his or her right or with the right of Bancorp or any
Subsidiary to terminate his or her employment at any time. Neither the
adoption of this Plan nor the granting of any Options under this Plan
will confer upon any Service Provider any right with respect to
continuation of engagement for services, nor will the same interfere in
any way with the terms of engagement of such Service Provider.
6. TERMS AND CONDITIONS OF OPTIONS. All Options granted under this Plan
must be authorized by the Committee, and must be documented in written
Option agreements in such form as the Committee will approve from time
to time, which agreements must comply with and be subject to all of the
following terms and conditions:
a. Number of Shares; Annual Limitation. Each Option agreement must
state whether the Option is intended to be an Incentive Stock
Option or a Nonqualified Stock Option and the number of shares
subject to Option. Any number of Options may be granted to an
Optionee at any time; except that, in the case of Incentive Stock
Options, the aggregate fair market value (determined as of each
Date of Grant) of all shares of Common Stock with respect to
which Incentive Stock Options become exercisable for the first
time by such Employee during any one calendar year (under all
incentive stock option plans of the Company and all of its
Subsidiaries taken together) shall not exceed $100,000. Any
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portion of an Option in excess of the $100,000 limitation shall
be treated as a Nonqualified Stock Option.
b. Exercise Price and Consideration. Each option agreement must
state the Exercise Price for the shares of Common Stock to be
issued under the Option. The Exercise Price shall be the price
determined by the Committee, subject to subparagraphs (1) and (2)
below.
(1) In the case of Incentive Stock Options, the Exercise Price
shall in no event be less than the fair market value of
the Common Stock on the Date of Grant. In the case of an
Incentive Stock Option granted to a Employee who,
immediately before the grant of such Incentive Stock
Option, is a Shareholder-Employee, the Exercise Price
shall be at least 110% of the fair market value of the
Common Stock on the Date of Grant.
(2) In all cases, the Exercise Price shall be no less than the
greater of (i) the fair market value of the Common Stock
or (ii) the net book value of the Common Stock, each as
determined by the Committee at the time of grant.
(3) In all cases, the Exercise 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, debt instruments or other property.
c. Term of Option. No Option shall in any event be exercisable after
the expiration of ten (10) years from the Date of Grant. Further,
no Incentive Stock Option granted to a Employee who, immediately
before such Incentive Stock Option is granted, is a
Shareholder-Employee shall be exercisable after the expiration of
five (5) years from the Date of Grant. Subject to the foregoing
and other applicable provisions of the Plan including but not
limited to subparagraphs 6(g), 6(h) and 6(i), the term of each
Option will be determined by the Committee in its discretion.
(1) Vesting. The Committee shall provide in the option
agreement if, at its discretion, the Option is subject to
a vesting schedule specifying the date or dates upon which
the Option becomes exercisable and/or is subject to
vesting conditions specifying performance standards,
periods of service or other conditions which must be met
before the Option becomes exercisable. If an Option is
subject to a vesting schedule or vesting condition, then
unless the option agreement states otherwise, and except
as provided in subparagraph 6(l)(2), the Option will cease
to vest and will not become exercisable as to any
additional shares, as of the date on which the Optionee's
status as Employee or Service Provider terminates.
d. Non-transferability of Options.
(1) Except as otherwise provided in this subparagraph 6(d) or
by applicable law, no Option 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.
(2) The Board (in its sole discretion) may permit Nonqualified
Stock Options to be exercised by certain persons or
entities approved by the Board, subject to any conditions
and procedures that the Board (in its sole discretion) may
establish. Any permitted transfer is subject to the
further condition that the Board must receive evidence
satisfactory to it that the transfer is being made for
estate and/or
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tax planning purposes on a gratuitous or donative basis
and without consideration (other than nominal
consideration).
(3) The transfer restrictions in this subparagraph 6(d) do not
apply to transfers to Bancorp or authorization by the
Board of "cashless exercise" procedures with third parties
who provide financing for the purpose of (or who otherwise
facilitate) the exercise of an Option consistent with the
express authorization of the Board and applicable laws.
e. Manner of Exercise. An Option will 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.
f. Rights as Shareholder. An Optionee shall have none of the rights
of a shareholder with respect to any shares covered by his or her
Option unless and until the Optionee has exercised such Option
and submitted full payment for the shares.
g. Death of Optionee. An Option shall be exercisable at any time
prior to termination under subparagraphs (1) or (2), below, 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. In the
event of the death of an Optionee,
(1) an Incentive Stock Option shall terminate no later than
the earliest of (i) one year after the date of death of
the Optionee if the Optionee had been in Continuous Status
as an Employee since the Date of Grant of the Option, or
(ii) the date specified under subparagraph 6(i) of this
Plan if the Optionee's status as an Employee was
terminated prior to his or her death, or (iii) the
expiration date otherwise provided in the applicable
Option agreement; and
(2) a Nonqualified Stock Option shall terminate no later than
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 of a Nonqualified Stock Option should occur during
the 180-day period immediately following the Optionee's
death, such Option shall terminate at the end of such
180-day period.
h. Disability of Optionee. If an Employee-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 Code) and if 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 or her status as an Employee, his or
her Option shall terminate no later than the earlier of (i) one
year after the date of termination of his or her status as an
Employee, or (ii) the expiration date otherwise provided in his
or her Option agreement.
i. Termination of Status as an Employee or Service Provider. Unless
otherwise provided in the Option agreement, if an Optionee's
status as an Employee or Service Provider is terminated at any
time after the grant of an Option to such Optionee for any reason
other than death or, in the case of an Employee-Optionee,
disability (as described in subparagraphs 6(g) and 6(h) above),
then subject to subparagraph 6(l)(2), such Option shall terminate
no later than the earlier of (i) the expiration date otherwise
provided in his or her Option agreement, or (ii) in the case of
an Incentive Stock Option, the same day of the third month after
the date of termination of his or her status as an Employee, or
in the
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case a Nonqualified Stock Option, the same day of the sixth
month after the date of termination of his or her status as an
Employee or Service Provider.
j. 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 per-share Exercise Price in each
outstanding Option, will 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 will not be
deemed to have been "effected without receipt of consideration."
Such adjustment will be made by the Committee, whose
determination in that respect will be final, binding and
conclusive.
(1) Except as otherwise expressly provided in this
subparagraph 6(j), no Optionee will 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, and no issuance by Bancorp of
shares of stock of any class, or securities convertible
into shares of stock of any class, will affect the number
of shares or Exercise Price subject to any Options, and no
adjustments in Options will be made by reason thereof. The
grant of an Option under this Plan will not affect in any
way the right or power of Bancorp to make adjustments,
reclassifications, reorganizations or changes of its
capital or business structure.
k. Conditions Upon Issuance of Shares. Shares of Common Stock will
not be issued with respect to an Option granted under this Plan
unless the exercise of such Option and the issuance and delivery
of such shares pursuant thereto will 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.
l. Corporate Sale Transactions. In the event of a merger or
reorganization of Bancorp with or into any other corporation that
results in a "Change of Control of Bancorp" as defined below, or
a proposed sale of substantially all of the assets of Bancorp, or
a proposed dissolution or liquidation of Bancorp (collectively,
"Sale Transaction"), 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. The Committee may, in the exercise of its sole
discretion, terminate all outstanding Options as of a date fixed
by the Committee; provided that (i) the Committee shall notify
each Optionee of such action in writing not less than ninety (90)
days prior to the termination date fixed by the Committee and
(ii) all outstanding Options that are not the fully exercisable
shall become exercisable upon the date of the 90-day notice.
(1) For purposes of this subparagraph, a "Change of Control of
Bancorp" occurs on the date that any one person, or more
than one person acting as a group, acquires ownership of
stock of Bancorp that, together with stock held by such
person or group, possess more than 50% of the total fair
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market value or total voting power of Bancorp stock.
However, if any one person, or more than one person acting
as a group, is considered to own more that 50% of the
total fair market value or total voting power of stock of
Bancorp, the acquisition of additional stock by the same
person or persons is not considered to cause a Change of
Control of Bancorp. An increase in the percentage of stock
owned by any one person, or more than one person acting as
a group, as a result of a transaction in which Bancorp
acquires its stock in exchange for property will be
treated as an acquisition of stock for purposes of this
subparagraph. For purposes of this definition, persons
will not be considered to be "acting as a group" merely
because they happen to purchase or own stock of Bancorp at
the same time, or as the result of some public offering.
However, persons will be considered to be "acting as a
group" if they are owners of an entity that enters into a
merger, consolidation, purchase or acquisition of stock or
similar business transaction with Bancorp.
(2) If an Employee-Optionee's status as an Employee is
terminated at any time after the grant of an Option to
such Employee and after Bancorp executes an agreement for
a Change of Control of Bancorp but before the closing of
such Change of Control of Bancorp, then all outstanding
Options that are not then fully exercisable shall become
exercisable upon the date of termination.
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 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 stock option.
n. Tax Compliance. Bancorp, in its sole discretion, may take 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 Bancorp 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 Bancorp under applicable tax laws. Withholding or
reporting will be considered required for purposes of this
subparagraph if the Committee, in its sole discretion, so
determines.
o. Holding Period
(1) Incentive Stock Options. With regard to shares of Common
Stock issued pursuant to an Incentive Stock Option granted
under the Plan, if the Optionee (or such other person who
may exercise the Option pursuant to subparagraph 6(g) of
this Plan) makes a disposition of such shares within two
years from the Date of Grant of such Option, or within one
year from the date of issuance of such shares to the
Optionee upon the exercise of such Option, then the
Optionee must notify the Company in writing of such
disposition and must cooperate with the Company in any tax
compliance relating to such disposition.
(2) Section 16 Affiliates. With regard to shares of Common
Stock issued pursuant to any Option granted under this
Plan, if the Optionee is subject to Section 16 of the 1934
Act, such shares may not be sold or otherwise transferred
by the Optionee until six months have elapsed from the
date the Option was granted.
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p. Other Provisions. Option agreements executed under this Plan may
contain such other provisions as the Committee will deem
advisable.
7. TERM OF THE PLAN. This Plan will become effective and Options may be
granted upon the Plan's approval by the Board, subject to shareholder
approval. Unless sooner terminated as provided in subparagraph 7(a) of
this Plan, this Plan will terminate on the tenth (10th) anniversary of
its effective date. Options may be granted at any time after the
effective date and prior to the date of termination of this Plan.
a. Amendment or Early Termination of the Plan. The Board may
terminate this Plan at any time. The Board may amend this Plan at
any time and from time to time in such respects as the Board may
deem advisable, except that shareholder approval shall be
obtained for any amendments whenever required under any
applicable law, including but not limited to any increase in the
number of shares of Common Stock subject to this Plan other than
in connection with an adjustment under subparagraph 6(j) of this
Plan.
b. Effect of Amendment or Termination. No amendment or termination
of this Plan will affect Options granted prior to such amendment
or termination, and all such Options will remain in full force
and effect notwithstanding such amendment or termination.
Notwithstanding the foregoing, the Board may amend the Plan and
Incentive Stock Options previously granted hereunder, to the
extent permitted under the Code without causing a regrant of such
Options, to comply with the requirements of "incentive stock
options" within the scope and meaning of Section 422 of the Code,
or any successor provision.
8. SHAREHOLDER APPROVAL. Adoption of this Plan will be subject to
ratification by affirmative vote of shareholders owning at least a
majority of the outstanding Common Stock of Bancorp at a duly convened
meeting. If such shareholder approval is not obtained within twelve (12)
months after the date of the Board's adoption of this Plan, then this
Plan shall terminate subject to subparagraph 7(b) of the Plan except
that any Incentive Stock Options previously granted under the Plan shall
become Nonqualified Stock Options, and no further Options shall be
granted under the Plan.
* * * * *
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CERTIFICATE OF ADOPTION
I certify that the foregoing 1999 Stock Option Plan was approved by the
Board of Directors of West Coast Bancorp on [date] _______________________.
___________________________________
_______________, Secretary
I certify that the foregoing 1999 Stock Option Plan was approved by the
shareholders of West Coast Bancorp on [date] _______________________.
___________________________________
_______________, Secretary
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[LOGO]
WEST COAST BANCORP
ANNUAL MEETING OF SHAREHOLDERS
FRIDAY, APRIL 23, 1999
- --------------------------------------------------------------------------------
[LOGO]
WEST COAST BANCORP PROXY
- --------------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Victor L. Bartruff and Shauna L. Vernal, and
each of them (with full power to act alone) as Proxies, with full power of
substitution, and hereby authorizes them to represent and to vote, as designated
below, all the shares of common stock of West Coast Bancorp, held of record by
the undesigned on March 5, 1999, at the Annual Meeting of Shareholders to be
held on April 23, 1999, or any adjournment of such Meeting.
Management knows of no other matters that may properly be, or which are likely
to be, brought before the Meeting. However, if any other matters are properly
presented at the Meeting, this Proxy will be voted in accordance with the
recommendations of management.
PLEASE SIGN AND RETURN IMMEDIATELY
See reverse for voting instructions.
<PAGE> 34
--------------------
COMPANY #
CONTROL #
--------------------
THERE ARE THREE WAYS TO VOTE YOUR PROXY
YOUR TELEPHONE OR INTERNET VOTE AUTHORIZES THE NAMED PROXIES TO VOTE YOUR SHARES
IN THE SAME MANNER AS IF YOU MARKED, SIGNED AND RETURNED YOUR PROXY CARD.
VOTE BY PHONE -- TOLL FREE -- 1-800-240-6326 -- QUICK *** EASY *** IMMEDIATE
- - Use any touch-tone telephone to vote your proxy 24 hours a day, 7 days a
week.
- - You will be prompted to enter your 3-digit Company Number and your 7-digit
Control Number which is located above.
- - Follow the simple instructions the Voice provides you.
VOTE BY INTERNET -- HTTP://WWW.EPROXY.COM/WCBO/ -- QUICK *** EASY *** IMMEDIATE
- - Use the Internet to vote your proxy 24 hours a day, 7 days a week.
- - You will be prompted to enter your 3-digit Company Number and your 7-digit
Control Number which is located above to obtain your records and create an
electronic ballot.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope
we've provided or return it to West Coast Bancorp, c/o Shareowner Services(SM),
P.O. Box 64873, St. Paul, MN 55164-0873.
IF YOU VOTE BY PHONE OR INTERNET, PLEASE DO NOT MAIL YOUR PROXY CARD
[ARROW] PLEASE DETACH HERE [ARROW]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE LISTED PROPOSALS.
1. Election of directors: 01 Victor L. Bartruff 02 Michael J. Bragg
03 William B. Loch 04 Mary B. Pearmine
[ ] Vote FOR [ ] Vote WITHHELD
all nominees from all nominees
------------------------------
(INSTRUCTIONS: TO WITHHOLD AUTHORITY
TO VOTE FOR ANY INDICATED NOMINEE,
WRITE THE NUMBER(S) OF THE NOMINEE(S)
IN THE BOX PROVIDED TO THE RIGHT.)
------------------------------
2. ADOPTION OF THE 1999 STOCK OPTION PLAN. The adoption of a new Employee Stock
Option Plan. [ ] For [ ] Against [ ] Abstain
3. WHATEVER OTHER BUSINESS may properly be brought before the Meeting or any
adjournment thereof.
THIS PROXY CONFERS AUTHORITY TO VOTE "FOR" AND WILL BE VOTED "FOR" THE PROPOSALS
LISTED UNLESS AUTHORITY IS WITHHELD OR A VOTE AGAINST OR AN ABSTENTION IS
SPECIFIED, IN WHICH CASE THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATION SO MADE.
Address Change? Mark Box [ ]
Indicate changes below: Date _____________________, 1999
--------------------------------
--------------------------------
Signature(s) in Box
When signing as attorney,
executor, administrator, trustee
or guardian, please give full
title. If more than one trustee,
all should sign. All joint
owners must sign.
