Registration No.333-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
FIRST CHARTER CORPORATION
(Exact name of registrant as specified in its charter)
North Carolina 56-1355866
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) dentification No.)
22 Union Street, North
Concord, North Carolina 28025
(Address of Principal Executive Offices) (Zip Code)
FIRST CHARTER CORPORATION
COMPREHENSIVE STOCK OPTION PLAN
(Full title of the plan)
Lawrence M. Kimbrough, President
First Charter Corporation
22 Union Street, North
Concord, North Carolina 28025
(Name and address of agent for service)
Tel. (704) 786-3300
(Telephone number, including area code, of agent for service)
Copy to:
Anne Team Kelly, Esq.
Smith Helms Mulliss & Moore, L.L.P.
Post Office Box 31247
Charlotte, North Carolina 28231
Tel. (704) 343-2000 Fax (704) 334-8467
Approximate date of commencement of proposed sale to the
public: from time to time after the effective date of this
Registration Statement.
CALCULATION OF REGISTRATION FEE
______________________________________________-_______________
Title of Proposed Proposed
Securities Amount Maximum Maximum Amount of
To be To be Offering Aggregate Registration
Registered Registered Price Offering Fee
Per Unit* Price*
- -----------------------------------------------------------------
Common Stock 406,741 $23.69 $9,635,695 $2,843
Shares
________________________________________________________________
* Pursuant to Rule 457(h), based on the price of the Common
Stock at which options granted pursuant to the plan may be
exercised.
PART I. INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents constituting the Prospectus of First Charter
Corporation (the "Registrant") with respect to this Registration
Statement in accordance with Rule 428 promulgated pursuant to the
Securities Act of 1933, as amended (the "Securities Act"), are
kept on file at the offices of the Registrant. The Registrant
will provide without charge to employees, on the written or oral
request of any such person, a copy of any or all of the documents
constituting the Prospectus. Written requests for such copies
should be directed to the Director of Human Resources, First
Charter Corporation, 22 Union Street, North, Concord, North
Carolina 28025. Telephone requests may be directed to (704)786-3300.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by the Registrant with the
Securities and Exchange Commission (the "Commission") are
incorporated by reference herein and in the Prospectus
constituting a part of this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for
the year ended December 31, 1997, filed pursuant to Section
13 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act");
(b) The Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1998;
(c) The Registrant's Current Reports on Form 8-K filed
on January 6, 1998, January 28, 1998, April 14, 1998 and
May 28, 1998; and
(d) The description of the Registrant's Common Stock
contained in its Registration Statement filed pursuant to
Section 12 of the Exchange Act and all amendments and
reports filed for the purpose of updating such description,
including the Registrant's Current Report on Form 8-K filed
on January 28, 1998.
Any document filed by the Registrant with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange
Act subsequent to the effectiveness of this Registration
Statement and prior to the filing of a post-effective amendment
hereto which either indicates that all securities offered hereto
have been sold or deregisters all securities then remaining
unsold shall be deemed to be incorporated by reference in this
Registration Statement and the Prospectus and to be a part hereof
and thereof from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this Registration Statement and the
Prospectus to the extent that a statement contained herein or
therein or in any other subsequently filed document which also is
or is deemed to be incorporated by reference herein or therein
modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration
Statement or the Prospectus.
The Registrant will provide without charge to each person to
whom the Prospectus constituting a part of this Registration
Statement is delivered, on the written or oral request of any
such person, a copy of any or all of the documents incorporated
herein and in the Prospectus by reference (other than exhibits to
such documents which are not specifically incorporated by
reference in such documents). Written requests for such copies
should be directed to Laura N. Blalock, Director of Human
Resources, First Charter Corporation, 22 Union Street, North,
Concord, North Carolina 28025. Telephone requests may be
directed to (704) 786-3300.
Item 5. Interests of Named Experts and Counsel.
The legality of the Registrant's Common Stock to be issued
in connection with the Plan has been passed upon by Smith Helms
Mulliss & Moore, L.L.P., Charlotte, North Carolina. As of the
date of this Registration Statement on Form S-8, certain
attorneys of Smith Helms Mulliss & Moore, L.L.P., beneficially
owned approximately 8,500 shares of the Registrant's Common
Stock.
Item 6. Indemnification of Directors and Officers.
There are no provisions in the Registrant's Amended and Restated
Articles of Incorporation and no contracts between the Registrant
and its directors and officers nor resolutions adopted by the
Registrant, relating to indemnification. However, in accordance
with the provisions of the North Carolina Business Corporation
Act (the "Act"), the Registrant's Bylaws provide that, in
addition to the indemnification of directors and officers
otherwise provided by the Act, the Registrant shall, under
certain circumstances, indemnify its directors, executive
officers and certain other designated officers against any and
all liability and litigation expense, including reasonable
attorneys' fees, arising out of their status or activities as
directors and officers, except for liability or litigation
expense incurred on account of activities that were at the time
known or reasonably should have been known by such director or
officer to be clearly in conflict with the best interests of the
Registrant. Pursuant to such Bylaw and as authorized by statute,
the Registrant maintains insurance on behalf of its directors and
officers against liability asserted against such persons in such
capacity whether or not such directors or officers have the right
to indemnification pursuant to the Bylaw or otherwise. In
addition, the Registrant's Amended and Restated Articles of Incorporation
prevent the recovery by the Registrant or any of its shareholders
of monetary damages against its directors.
In addition to the above-described provisions, Sections 55-8-50
through 55-8-58 of the Act contain provisions prescribing
the extent to which directors and officers shall or may be
indemnified. Section 55-8-51 of the Act permits a corporation,
with certain exceptions, to indemnify a present or former
director against liability if (i) he conducted himself in good
faith, (ii) he reasonably believed (x) that his conduct in his
official capacity with the corporation was in its best interests
and (y) in all other cases his conduct was at least not opposed
to the corporation's best interest, and (iii) in the case of any
criminal proceeding, he had no reasonable cause to believe his
conduct was unlawful. A corporation may not indemnify a director
in connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation or in connection with a proceeding charging improper
personal benefit to him. The above standard of conduct is
determined by the Board of Directors, or a committee or special
legal counsel or the shareholders as prescribed in Section 55-8-55.
Sections 55-8-52 and 55-8-56 of the Act require a
corporation to indemnify a director or officer in the defense of
any proceeding to which he was a party against reasonable
expenses when he is wholly successful in his defense, unless the
articles of incorporation provide otherwise. Upon application,
the court may order indemnification of the director or officer if
he is adjudged fairly and reasonably so entitled under Section
55-8-54. Section 55-8-56 allows a corporation to indemnify and
advance expenses to an officer, employee or agent who is not a
director to the same extent as a director or as otherwise set
forth in the corporation's articles of incorporation or bylaws or
by a resolution of the Board of Directors.
In addition, Section 55-8-57 of the Act permits a
corporation to provide for indemnification of directors,
officers, employees or agents, in its articles of incorporation
or by contract or resolution, against liability in various
proceedings and to purchase and maintain insurance policies on
behalf of these individuals.
THE FOREGOING IS ONLY A GENERAL SUMMARY OF CERTAIN ASPECTS
OF NORTH CAROLINA LAW DEALING WITH INDEMNIFICATION OF DIRECTORS
AND OFFICERS AND DOES NOT PURPORT TO BE COMPLETE. IT IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE RELEVANT STATUTES
WHICH CONTAIN DETAILED SPECIFIC PROVISIONS REGARDING THE
CIRCUMSTANCES UNDER WHICH AND THE PERSON FOR WHOSE BENEFIT
INDEMNIFICATION SHALL OR MAY BE MADE AND ACCORDINGLY ARE
INCORPORATED BY REFERENCE AS EXHIBIT 99.2 OF THIS REGISTRATION
STATEMENT.
Item 8. Exhibits.
The following exhibits are filed with or incorporated by
reference in this Registration Statement.
Exhibit No.
(per Exhibit
Tables in
Item 601 of
Regulation S-K) Description of Exhibit
5.1 Opinion of Smith Helms Mulliss & Moore, L.L.P. as
to legality of securities to be registered.
23.1 Consent of Smith Helms Mulliss & Moore, L.L.P.
(included in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP, independent
certified public accountants.
24.1 Power of Attorney.
24.2 Certified Resolution authorizing signature of
Registration Statement.
99.1 Comprehensive Stock Option Plan, as amended.
99.2 Provisions of North Carolina law relating to
indemnification of directors and officers
(incorporated herein by reference to Exhibit 99.10
of First Charter's Registration Statement on Form
S-4, Registration No. 333-35905).
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts
or events arising after the effective date of the
Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease
in volume of securities offered (if the total dollar
value of securities offered would not exceed that which
was registered) and any deviation from the low or high
end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no
more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration
Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
do not apply if the Registration Statement is on Form S-3 or
Form S-8 or Form F-3, and the information required to be
included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to
the Commission by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered
which remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration
Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on
Form S-8 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Concord, North Carolina, on May 29,
1998.
FIRST CHARTER CORPORATION
By:/s/ LAWRENCE M. KIMBROUGH
Lawrence M. Kimbrough
President and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
Signature Title Date
/s/ LAWRENCE M. KIMBROUGH President, Chief May 29, 1998
Lawrence M. Kimbrough Executive Officer
and Director
(Principal Executive
Officer)
/s/ ROBERT O. BRATTON Executive Vice May 29, 1998
Robert O. Bratton President
(Principal Financial
and Principal Accounting
Officer)
Director May __, 1998
William R. Black
MICHAEL R. COLTRANE* Director May 29, 1998
Michael R. Coltrane
J. ROY DAVIS, JR.* Director May 29, 1998
J. Roy Davis, Jr.
T. CARL DEDMON* Director May 29, 1998
T. Carl Dedmon
Director May __, 1998
James B. Fincher
JOHN J. GODBOLD, JR.* Director May 29, 1998
John J. Godbold, Jr.
H. CLARK GOODWIN* Director May 29, 1998
H. Clark Goodwin
Director May __, 1998
Charles F. Harry III
FRANK H. HAWFIELD, JR.* Director May 29, 1998
Frank H. Hawfield, Jr.
J. KNOX HILLMAN, JR.* Director May 29, 1998
J. Knox Hillman, Jr.
JERRY E. MCGEE* Director May 29, 1998
Jerry E. McGee
HUGH H. MORRISON* Director May 29, 1998
Hugh H. Morrison
THOMAS R. REVELS* Director May 29, 1998
Thomas R. Revels
*By:/s/ LAWRENCE M. KIMBROUGH
Lawrence M. Kimbrough
Attorney-in-Fact
EXHIBIT INDEX
Exhibit No.
(per Exhibit
Tables in
Item 601 of
Regulation S-K) Description of Exhibit
5.1 Opinion of Smith Helms Mulliss & Moore, L.L.P.
as to legality of securities to be registered.
23.1 Consent of Smith Helms Mulliss & Moore, L.L.P.
(included in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP, independent
certified public accountants.
24.1 Power of Attorney.
24.2 Certified Resolution authorizing signature of
Registration Statement.
99.1 Comprehensive Stock Option Plan, as amended.
99.2 Provisions of North Carolina law relating
to indemnification of directors and officers
(incorporated herein by reference to Exhibit 99.10
of First Charter's Registration Statement on
Form S-4, Registration No. 333-35905).
SMITH HELMS MULLISS & MOORE, L.L.P.
Attorneys at Law
Post Office Box 31247
Charlotte, North Carolina 28231
(Tel) (704) 343-2000
(Fax) (704) 334-9467
May 29, 1998
First Charter Corporation
22 Union Street, North
Concord, North Carolina 28025
Re: Registration Statement on Form S-8
406,741 Shares of Common Stock
Comprehensive Stock Option Plan
Ladies and Gentlemen:
In connection with the possible offering and sale from time
to time of up to 406,741 shares of the common stock (the
"Shares") of First Charter Corporation (the "Corporation"), upon
the terms and conditions set forth in the Registration Statement
on Form S-8 (the "Registration Statement"), filed on May 29, 1998
by the Corporation with the Securities and Exchange Commission
under the Securities Act of 1933, as amended, and the prospectus
constituting a part thereof (the "Prospectus"), we are of the
opinion that when (a) the Registration Statement shall become
effective, and (b) the Shares have been sold upon the terms and
conditions set forth in the Registration Statement and the
Prospectus, the Shares will be validly authorized and legally
issued, fully paid and nonassessable.
We hereby consent (1) to be named in the Registration
Statement and in the Prospectus as attorneys who will pass upon
the legality of the Shares and (2) to the filing of a copy of
this opinion as Exhibit 5.1 of the Registration Statement.
Very truly yours,
/S/ SMITH HELMS MULLISS & MOORE,L.L.P.
The Board of Directors
First Charter Corporation:
We consent to the incorporation by reference in the Registration Statement on
Form S-8 of First Charter Corporation of our report on the consolidated
financial statements included in the 1997 Annual Report to Shareholders which
is incorporated by reference in the 1997 Form 10-K of First Charter
Corporation.
/s/ KPMG PEAT MARWICK LLP
Charlotte, North Carolina
May 28, 1998
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of First Charter
Corporation (the "Corporation") and the several undersigned
Officers and Directors thereof whose signatures appear below
hereby makes, constitutes and appoints Lawrence M. Kimbrough and
Robert O. Bratton, and each of them acting individually, its and
his true and lawful attorneys, with full power to act without the
other and with full power of substitution, to execute, deliver
and file in its name and on its and his behalf, and in each of
the undersigned Officer's and Director's capacity or capacities
as shown below, (a) a Registration Statement on Form S-8 (or
other appropriate form) with respect to the registration under
the Securities Act of 1933, as amended (the "Securities Act"), of
406,741 shares of the Common Stock of the Corporation for sale
from time to time by the Corporation to various of its employees
pursuant to the exercise of options granted under the
Comprehensive Stock Option Plan, and any and all amendments,
including any and all post-effective amendments, to the foregoing
and any and all documents in support thereof or supplemental
thereto, and (b) such registration statements, petitions,
applications, consents to service of process or other
instruments, and any and all amendments or supplements to the
foregoing and any and all documents in support thereof or
supplemental thereto, as may be necessary or advisable to qualify
or register the securities covered by said Registration Statement
under such state or other securities laws, regulations and
requirements as may be applicable; and each of the Corporation
and said Officers and Directors hereby grants to said attorneys,
and to each of them, full power and authority to do and perform
each and every act and thing whatsoever as said attorneys or
attorney may deem necessary or advisable to carry out fully the
intent of this power of attorney to the same extent and with the
same effect as the Corporation might or could do, and as each of
said Officers and Directors might or could do personally in his
capacity or capacities as aforesaid, and each of the Corporation
and said Officers and Directors hereby ratifies and confirms all
acts and things which said attorneys or attorney might do or
cause to be done by virtue of this power of attorney and its or
his signature as the same may be signed by said attorneys or
attorney, or either of them, to any or all of the following
(and/or any and all amendments and supplements to any or all
thereof): such Registration Statement under the Securities Act,
and all such registration statements, petitions, applications,
consents to service of process and other instruments, and any and
all amendments to the foregoing and any and all documents in
support thereof or supplemental thereto, under such securities
laws, regulations and requirements as may be applicable.
IN WITNESS WHEREOF, First Charter Corporation has caused
this power of attorney to be signed on its behalf, and each of
the undersigned Officers and Directors of the Corporation in the
capacity or capacities noted has hereunto set his hand on the
date indicated.
FIRST CHARTER CORPORATION
By:/s/ LAWRENCE M. KIMBROUGH
Lawrence M. Kimbrough
President and Chief Executive
Officer
Dated: April 15, 1998
Signature Title Date
/S LAWRENCE M. KIMBROUGH President, Chief April 15, 1998
LAWRENCE M. KIMBROUGH Executive Officer
and Director
(Principal Executive
Officer)
/S/ ROBERT O. BRATTON Executive Vice April 15, 1998
Robert O. Bratton President
(Principal Financial
and Principal Accounting
Officer)
______________________ Director April __, 1998
William R. Black
/S/ MICHAEL R. COLTRANE Director April 15, 1998
Michael R. Coltrane
/S/ J. ROY DAVIS, JR. Director April 15, 1998
J. Roy Davis, Jr.
/S/ T. CARL DEDMON Director April 15, 1998
T. Carl Dedmon
______________________ Director April __, 1998
James B. Fincher
/S/ JOHN J. GODBOLD, JR. Director April 15, 1998
John J. Godbold, Jr.
/S/ H. CLARK GOODWIN Director April 15, 1998
H. Clark Goodwin
______________________ Director April __, 1998
Charles F. Harry III
/S/ FRANK H. HAWFIELD, JR. Director April 15, 1998
Frank H. Hawfield, Jr.
/S/ J. KNOX HILLMAN, JR. Director April 15, 1998
J. Knox Hillman, Jr.
/S/ BRANSON C. JONES Director April 15, 1998
Branson C. Jones
/S/ JERRY E. MCGEE Director April 15, 1998
Jerry E. McGee
/S/ HUGH H. MORRISON Director April 15, 1998
Hugh H. Morrison
/S/ THOMAS R. REVELS Director April 15, 1998
Thomas R. Revels
BOARD OF DIRECTORS OF
FIRST CHARTER CORPORATION
______
RESOLUTIONS
______
April 15, 1998
REGISTRATION OF COMPREHENSIVE STOCK OPTION PLAN
WHEREAS, the Corporation currently maintains the
Comprehensive Stock Option Plan (the "Plan"), pursuant to which
options to purchase shares of the Corporation's Common Stock may
be issued to key employees of the Corporation from time to time;
and
WHEREAS, as of the date hereof, 406,741 shares of Common
Stock (as adjusted to reflect certain stock splits) (the
"Shares") remain available under the Plan to be issued pursuant
to the exercise of options granted under the Plan; and
WHEREAS, the Board of Directors has determined that it is in
the best interest of the Corporation to register the Shares under
the Securities Act of 1933, as amended (the "Securities Act")
prior to issuance pursuant to the exercise of options granted
under the Plan;
NOW, THEREFORE, BE IT RESOLVED, that the proper officers of
the Corporation be, and they hereby are, authorized and empowered
(a) to execute and file with the Securities and Exchange
Commission (the "SEC") a Registration Statement on Form S-8 (or
other applicable form as counsel may advise) under the Securities
Act, with respect to the possible issuance or sale from time to
time of some or all of the Shares to its employees pursuant to
the exercise of options granted under the Plan, with such terms
therein as the officers executing the same may approve, their
execution to be conclusive evidence of such approval, and (b) to
execute and file all such other instruments and documents, to
make all such payments, to do all such other acts and things in
connection with said Registration Statement, including the
execution and filing of such amendment or amendments (including
any post-effective amendments) thereto, as they may deem
necessary or advisable in order to effect such filing and to
procure the effectiveness of said Registration Statement (and any
such post-effective amendments thereto) and to make such
supplements to the Prospectus forming a part of said Registration
Statement as may be required or otherwise as they may deem
advisable; and
FURTHER RESOLVED, that the Registration on Form S-8 relating
to the Shares to be sold and distributed pursuant to the Plan,
be, and it hereby is, approved in substantially the form
presented to the Board of Directors, together with any amendment
or amendments that the proper officers of the Corporation, upon
the advice of counsel, may determine to be necessary or
appropriate; and
FURTHER RESOLVED, that Lawrence M. Kimbrough and Robert O.
Bratton, and each of them with full power to act without the
other, be, and they hereby are, authorized and empowered to sign
the aforesaid Registration Statement and any amendment or
amendments (including post-effective amendments) thereto on
behalf of and as attorneys for the Corporation and on behalf of
and as attorneys for any of the following, to wit: the principal
executive officer, the principal financial officer, the principal
accounting officer, and any other officer of the Corporation,
including the Chairman of the Board of Directors and the
President of the Corporation; and
FURTHER RESOLVED, that Lawrence M. Kimbrough be, and he
hereby is, appointed and designated as the Agent for Service of
the Corporation to be named in the aforesaid Registration
Statement, with authority to receive notices and communications
with respect to the registration of the Shares under the
Securities Act, with all powers and functions consequent upon
such designation under the Rules and Regulations of the SEC; and
FURTHER RESOLVED, that it is desirable and in the best
interest of the Corporation that the Shares be qualified or
registered for distribution in various states where appropriate,
that the Chief Executive Officer, Chief Financial Officer and
Secretary of the Corporation hereby are authorized, empowered and
directed to determine the states in which appropriate action
shall be taken to qualify or register for distribution the Shares
as said officers may deem advisable; that said officers are
hereby authorized, empowered and directed to perform on behalf of
the Corporation any and all such acts as they may deem necessary
or advisable in order to comply with the applicable laws of any
such states, and in connection therewith to execute and file all
requisite papers and documents, including, but not limited to,
resolutions, applications, reports, surety bonds, irrevocable
consents and appointments of attorneys for service of process;
and the execution by such officers of any such paper or document
or the doing by them of any act in connection with the foregoing
matters shall conclusively establish their authority therefor
from the Corporation and the approval and ratification by the
Corporation of the papers and documents so executed and the
actions so taken; and
FURTHER RESOLVED, that such officers be, and they hereby
are, authorized and directed to do any and all things which in
their judgment may be necessary or appropriate in order to obtain
a permit, exemption, registration or qualification for, and a
dealer's license with respect to, the distribution of the Shares
under the securities laws of any one or more of the states as
such officers may deem advisable and in connection therewith to
execute, acknowledge, verify, deliver, file and publish all
applications, reports, resolutions, consents, consents to service
of process, powers of attorney, commitments and other papers and
instruments as may be required under such laws and to take any
and all further actions which they may deem necessary or
appropriate in order to secure and to maintain such permits,
exemptions, registrations and qualifications in effect for so
long as they shall deem in the best interest of the Corporation;
and
FURTHER RESOLVED, that upon the issuance thereof pursuant to
the exercise of options granted under the Plan, the Shares shall
be deemed to be fully paid and nonassessable and the holders of
such Shares shall be subject to no further call or liability with
respect thereto; and
FURTHER RESOLVED, that First Charter National Bank be, and
it hereby is, appointed Transfer Agent and Registrar for such
Shares; and it is hereby vested with all the power and authority
as Transfer Agent and Registrar with respect to said Shares as it
has heretofore been vested with for the shares of the
Corporation's Common Stock currently issued and outstanding; and
FURTHER RESOLVED, that the officers of the Corporation be,
and they hereby are, authorized, empowered and directed to file
any form of notification or application or similar form as may be
required to maintain the designation of the Common Stock on The
Nasdaq Stock Market as a National Market Security and to pay any
fees required in connection therewith; and
FURTHER RESOLVED, that the Board of Directors hereby adopts,
as if expressly set forth herein, the form of any resolution
required by any authority to be filed in connection with any
applications, consents to service or other documents,
applications, reports or filings relating to the foregoing
resolutions if (i) in the opinion of the officers of the
Corporation executing same, the adoption of such resolutions is
necessary or desirable and (ii) the Secretary or an Assistant
Secretary of the Corporation evidences such adoption by inserting
in the minutes of this meeting copies of such resolutions, which
will thereupon be deemed to be adopted by the Board of Directors
with the same force and effect as if presented at this meeting;
and
FURTHER RESOLVED, that the officers of the Corporation be,
and they hereby are, authorized, empowered and directed to do
any and all things of any and every nature whatsoever and execute
all instruments, certificates and documents which they in their
discretion deem necessary, appropriate or convenient to carry
into effect the foregoing resolutions and the purpose and intent
thereof.
FIRST CHARTER CORPORATION
CERTIFICATE OF SECRETARY
I, David E. Keul, Assistant Corporate Secretary of First
Charter Corporation, a corporation organized and existing under
the laws of the State of North Carolina (the "Corporation"), do
hereby certify that the foregoing is a true and correct copy of
resolutions duly adopted by the Board of Directors of the
Corporation at a meeting of the Board of Directors held on April
15, 1998, at which meeting a quorum was present and acting
throughout, and that all such resolutions are in full effect and
have not been amended or rescinded as of the date hereof.
IN WITNESS WHEREOF, I have hereupon set my hand and affixed
the seal of the Corporation this 29th day of May, 1998.
/s/ DAVID E. KEUL
David E. Keul
Assistant Corporate Secretary
(CORPORATE SEAL)
FIRST CHARTER CORPORATION
COMPREHENSIVE STOCK OPTION PLAN
AS AMENDED EFFECTIVE MARCH 26, 1996
First Charter Corporation, a North Carolina corporation (the
"Corporation"), hereby establishes this Comprehensive Stock
Option Plan for the benefit of the Corporation and its
Subsidiaries, stockholders and Key Employees:
Article I - General Provisions
Section 1.1 Purpose. This First Charter Corporation
Comprehensive Stock Option Plan (the "Plan") is intended to
secure for First Charter Corporation and its stockholders the
benefits arising from ownership of the Corporation's common stock
by those selected Key Employees of the Corporation who will be
responsible for its future growth. The Program is designed to
help attract and retain superior personnel for positions of
substantial responsibility with the Corporation, and to provide
Key Employees with an additional incentive to contribute to the
success of the Corporation. It is also intended that the Plan
shall satisfy the requirements of Rule 16b-3 under the Securities
Exchange Act of 1934.
Section 1.2 Definitions.
(a) "Board of Directors" means the Board of Directors of
the Corporation.
(b) "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
(c) "Committee" means the Committee appointed by the Board
of Directors to administer the Plan.
(d) "Common Stock" means the common stock, par value $5.00
per share, of the Corporation to be issued pursuant to
the Plan.
(e) "Corporation" means First Charter Corporation.
(f) "Disabled" means the inability of an Optionee to engage
in his or her profession by reason of any medically
determinable physical or mental impairment which can be
expected to result in death or which is to last or can
be expected to last for a continuous period of not less
than twelve months, as determined by the Committee in
its sole discretion upon certification thereof by a
qualified physician selected by the Committee after
such physician examines the Optionee.
(g) "Fair Market Value" means the average of the closing
bid and asked prices for the Common Stock in the over-
the-counter market as reported by the National
Association of Securities Dealers Automated Quotation
("NASDAQ") System if the Common Stock is not listed on
a national securities exchange or the NASDAQ National
Market System; or the closing price of the Common Stock
if the Common Stock is listed on a national securities
exchange or traded on the NASDAQ National Market
System; or the fair value thereof determined in good
faith by the Board of Directors if the Common Stock is
not listed on a national securities exchange or quoted
on the NASDAQ National Market System or the over-the-counter market.
(h) "Incentive Stock Option" means an Option granted by the
Corporation to a Key Employee which is intended to
qualify as an Incentive Stock Option under Section 422
of the Code.
(i) "Key Employee" means an active full time employee of
the Corporation or its Subsidiaries who has significant
responsibility for the growth and financial success of
the Corporation including officers and other employees
of the Corporation and its Subsidiaries.
(j) "Option" means the right granted by the Corporation
pursuant to the Plan to a Key Employee to purchase
shares of Common Stock.
(k) "Optionee" means the individual granted an Option.
(l) "Plan" means the First Charter Corporation
Comprehensive Stock Option Plan.
(m) "Stock Option Agreement" means a formal written
agreement between the Corporation and an Optionee in
such form and containing such provisions not
inconsistent with the provisions of the Plan as the
Committee shall from time to time approve setting forth
the terms and conditions of the grant of an Option to
purchase shares of Common Stock pursuant to the Plan.
(n) "Subsidiary" means a subsidiary corporation of the
Corporation as that term is defined in Section 424(f)
of the Code. "Subsidiaries" means more than one
Subsidiary.
Article II - Administration
Section 2.1 Appointment of Committee. The Board of
Directors shall appoint the Committee which shall consist of not
less than three directors of the Corporation. The Committee
shall be composed of "disinterested persons" within the meaning
of Rule 16b-3 promulgated pursuant to the provisions of the
Securities Exchange Act of 1934. No member of the Committee or
member of the Board of Directors shall be liable for any action
or determination made in good faith with respect to the Plan or
to any option granted thereunder.
Section 2.2 Authority of The Committee. Subject to the
other provisions of the Plan and with a view to effecting its
purpose, the Committee shall have sole authority in its absolute
discretion: (i) to construe and interpret the Plan; (ii) to
define the terms used herein; (iii) to prescribe, amend, and
rescind rules and regulations relating to the Plan; (iv) to
determine the Key Employees of the Corporation and of the
Subsidiaries to whom Options shall be granted; (v) to determine
the time or times when Options shall be granted; (vi) to
determine the price or prices at which Options shall be granted;
(vii) to determine the option periods; (viii) to determine the
number of shares to be subject to each Option; and (ix) to make
any other determinations necessary or advisable for the
administration of the Plan and to do everything necessary or
appropriate to administer the Plan. All decisions,
determinations, and interpretations made by the Committee shall
be binding and conclusive for all purposes upon all persons
including, without limitation, the Corporation and its
Subsidiaries, the Committee and each of the members thereof, the
directors, officers and employees of the Corporation and its
Subsidiaries, the Optionee, and their respective successors in
interest.
Section 2.3 Committee Administration. The members of the
Committee shall serve at the pleasure of the Board of Directors,
which may fill vacancies, however caused, in the Committee. The
Committee shall select one of its members as its chairman and
shall hold its meetings at such times and places as it shall deem
advisable. A majority of its members shall constitute a quorum,
and all actions of the Committee shall be taken by a majority of
its members. Any action of the Committee evidenced by a written
instrument, signed by a majority of its members, shall be fully
as effective as if it had been taken by a vote of a majority of
its members at a meeting duly called and held. The Committee
shall (i) appoint a secretary, who may be but need not be a
member of the Committee, (ii) keep minutes of its meetings, and
(iii) make such rules and regulations for the conduct of its
business as it shall deem advisable.
Section 2.4 Privileges of Stock Ownership. No person
entitled to exercise any option granted under the Plan shall have
any of the rights or privileges of a shareholder of the
Corporation in respect of any shares of stock issuable upon
exercise of such option until certificates representing such
shares shall have been issued and delivered. No shares shall be
required to be issued and delivered upon exercise of any option
under the Plan unless and until all of the requirements of law
and of all regulatory agencies having jurisdiction over the
issuance and delivery of the securities shall have been fully
complied with. No adjustment shall be made for dividends or any
other distributions for which the record date is prior to the
date on which such stock certificate is issued.
Section 2.5 Reservation of Shares of Common Stock. The
Corporation, during the term of this Plan, will at all times
reserve and keep available such number of shares of its Common
Stock as shall be sufficient to satisfy the requirements of the
Plan. In addition, the Corporation will from time to time, as is
necessary to accomplish the purposes of this Plan, seek to obtain
from any regulatory agency having jurisdiction any requisite
authority in order to issue and sell shares of Common Stock
hereunder. The inability of the Corporation to obtain from any
regulatory agency having jurisdiction the authority deemed by the
Corporation's counsel to be necessary to the lawful issuance and
sale of any shares of its stock hereunder shall relieve the
Corporation of any liability in respect of the non-issuance or
sale of the stock as to which the requisite authority shall not
have been obtained.
Section 2.6 Tax Withholding. The exercise of any option
granted under the Plan other than an Incentive Stock Option is
subject to the condition that if at any time the Corporation
shall determine, in its discretion, that the satisfaction of
withholding tax or other withholding liabilities under any state
or federal law is necessary or desirable as a condition of, or in
any connection with, such exercise or the delivery or purchase of
shares pursuant thereto, then in such event, the exercise of the
Option shall not be effective unless such withholding tax or
other withholding liabilities shall have been satisfied in a
manner acceptable to the Corporation. In the event of the
disposition by an Optionee of shares of Common Stock acquired
pursuant to the exercise of an Incentive Stock Option granted
pursuant to the Plan within two years of the granting of the
Incentive Stock Option or within one year after the exercise of
the Incentive Stock Option, the Corporation shall have the right
to require that the Optionee pay to the Corporation or have
withheld from the Optionee's compensation any amounts necessary
to satisfy the Corporation's withholding liabilities with respect
to such disposition.
Article III - Options
Section 3.1 Eligibility. In determining the Key Employees
to whom Options will be granted and the number of shares to be
covered by each Option, the Committee shall take into account the
duties of the respective employees, their present and potential
contributions to the success of the Corporation, the anticipated
number of years of effective service remaining, and such other
factors as they shall deem relevant in connection with
accomplishing the purposes of the Plan. Subject to the limits
set forth in this Plan, a Key Employee who has been granted an
Option may be granted an additional Option or Options if the
Committee shall so determine.
Section 3.2 Stock Subject to Option. Subject to adjustment
as provided in Section 3.8 hereof, shares to be issued upon the
exercise of Options shall be authorized but unissued shares of
Common Stock or issued shares of Common Stock of the Corporation,
and the aggregate amount of Common Stock which may be issued upon
exercise of all Options under the Plan shall not exceed 400,000
of such shares. If any Option granted under the Plan shall
expire or terminate for any reason, without having been exercised
in full, the shares covered by the Option but not purchased shall
again be available for Options to be granted under the Plan.
Section 3.3 Granting of Options; Option Price.
(a) Following the selection by the Committee of a Key
Employee to whom an Option shall be granted, the Corporation
shall tender for a signature a Stock Option Agreement. The date
on which an Option shall be granted shall be the date of the
Committee's authorization of such grant, or such later date as
may be determined by the Committee at the time such grant is
authorized.
(b) The purchase price of the Common Stock under each
Option shall be determined by the Committee, but in no event
shall the purchase price with respect to authorized but
theretofore unissued shares of Common Stock be less than the par
value of the Common Stock.
Section 3.4 Exercise of Option. An Option may be exercised
by written notice to the Corporation at its offices at 22 Union
Street, North, Concord, North Carolina 28025, or such other
address to which the office may be relocated, which notice shall
(i) be signed by the Optionee or by the Optionee's successors, as
hereinafter described in Section 9, (ii) state the number of
shares with respect to which the Option is being exercised, and
(iii) contain the representation that it is the Optionee's
present intention to acquire the shares being purchased for
investment and not for resale and such other representations as
the Committee may require. Payment in full of the option price
of said shares shall be made at the time of the exercise of the
Option (i) in cash or by check payable to the order of the
Corporation, (ii) by delivery of shares of Common Stock of the
Corporation already owned by, and in the possession of, the
Optionee, or (iii) if authorized by the Committee or if specified
in the Option being exercised, by a promissory note made by the
Optionee in favor of the Corporation, upon the terms and
conditions determined by the Committee and secured by the shares
issuable upon exercise, complying with applicable law (including,
without limitation, state corporate and federal margin
requirements), or any combination thereof. Shares of Common
Stock previously held by the Optionee and surrendered in
accordance with rules and regulations adopted by the Committee
for the purpose of making full or partial payment of the option
price, shall be valued for such purpose at the Fair Market Value
thereof on the date the Option is exercised. As soon as
practicable after said notice and the option price have been
received by the Corporation, the Corporation shall deliver to the
Optionee a stock certificate registered in the Optionee's name
representing the Option shares.
Except as provided in Section 3.6 hereof, at the time of the
exercise of an Option, the Optionee must be an employee of the
Corporation or of a Subsidiary.
Except as otherwise provided herein, the Optionee shall not
have any rights of a shareholder of the Corporation with respect
to the shares covered by the Option except to the extent that,
and until, one or more certificates for shares shall have been
delivered to the Optionee upon the due exercise of the Option.
Section 3.5 Term of Option. Options granted hereunder
shall be exercisable in whole or in part or in installments, from
time to time, during the option period determined by the
Committee and set forth in the Stock Option Agreement. Any
exercise of an Option for less than the total number of shares of
Common Stock identified in the Option shall be deemed to be an
exercise in part and the Option may again be exercised in
accordance with the terms of this Plan at such time or times
determined by the Optionee, provided that at each such time the
Option is still exercisable under the terms of the Stock Option
Agreement and the Plan. Except as provided in Section 3.6 and
3.8, no Option granted under the Plan shall be exercisable within
six months of the date the Option is granted; provided, however,
that no Option granted under the Plan shall be exercisable within
six months of the date the Plan is approved by the shareholders
of the Corporation.
Section 3.6 Termination of Employment.
(a) If the employment of any person to whom an Option has
been granted is terminated for any reason other than death,
disability, retirement with the consent of the Corporation or
termination without cause, his or her Option or Options shall
terminate immediately. If an Optionee retires with the consent
of the Corporation or if an Optionee is terminated without cause
by the Corporation, or any of its Subsidiaries, the Optionee may
exercise his or her Option to the extent that he or she was
entitled to exercise it as of the date of said retirement or
termination but only within three months after said retirement or
termination and in no event after the expiration of ten years
from the date such Option was granted. A temporary leave of
absence approved by the Corporation or any of its Subsidiaries
and the Committee shall not be deemed to be a termination of
employment.
(b) If an Optionee dies or becomes Disabled while he or she
is an employee of the Corporation or any of its Subsidiaries, or
shall die within three months after retirement (provided that
such retirement is with the consent of the Corporation), the
Optionee's Option may be exercised (to the extent Optionee would
have been entitled to do so on the date of Optionee's death or
disability) at any time within one year after the date of his or
her death or disability or, if Optionee dies within three months
after retirement (provided that such retirement is with the
consent of the Corporation), at any time within one year after
such retirement, but in no event after the expiration of ten
years from the date the Option is granted. In the event of the
Optionee's death, such Options may be exercisable to the extent
otherwise provided herein by the executor or personal
representative of the Optionee's estate or by any person who
acquired the right to exercise such Options by bequest under the
Optionee's will or by inheritance. In the event the Optionee is
Disabled, such Options may be exercised to the extent otherwise
provided herein by the personal representative of the Optionee or
such other person designated by a court of competent jurisdiction
or by power of attorney to handle the Optionee's personal estate
or affairs.
Section 3.7 The Right of the Corporation to Terminate
Employment. Nothing contained in the Plan or in any Option
granted pursuant to the Plan shall confer upon any Optionee any
right to be continued in the employment of the Corporation or one
of its Subsidiaries, or shall interfere in any way with the right
of the Corporation or any of its Subsidiaries, as the case may
be, to terminate his or her employment at any time for any
reason.
Section 3.8 Adjustments Upon Changes in Capitalization;
Acceleration of Exercise Rights.
(a) The total amount of shares on which Options may be
granted under the Plan and option rights (both as to the number
of shares and the option exercise price per share) shall be
appropriately adjusted for any increase or decrease in the number
of outstanding shares of Common Stock resulting from payment of a
stock dividend on the Common Stock, a subdivision or combination
of shares of the Common Stock or from a reclassification of the
Common Stock, and (in accordance with the provisions contained in
the next following paragraph) in the event of a merger or
consolidation.
(b) After the merger of one or more corporations into the
Corporation or any Subsidiary, any merger of the Corporation or a
Subsidiary into another corporation, any consolidation of the
Corporation or any Subsidiary and one or more other corporations,
or any other corporate reorganization of any form involving the
Corporation or a Subsidiary as a party thereto involving any
exchange, conversion, adjustment or other modification of the
outstanding shares of the Common Stock, each Optionee at the time
of such corporate reorganization shall, at no additional cost, be
entitled, upon any exercise of his Option, to receive, in lieu of
the number of shares as to which such Option shall then be so
exercised, the number and class of shares of stock or other
securities or such other property to which such Optionee would
have been entitled pursuant to the terms of the agreement of
merger or consolidation if at the time of such merger or
consolidation such Optionee had been a holder of record of a
number of shares of Common Stock equal to the number of shares
which then remain exercisable under such Option. Comparable
rights shall accrue to each Optionee in the event of successive
mergers or consolidations of the character described above.
The foregoing adjustments and the manner of application of
the foregoing provisions shall be determined by the Committee in
its sole discretion. Any such adjustment may provide for the
elimination of any fractional share which might otherwise become
subject to an Option.
(c) In the event of (i) the adoption of a plan of merger or
consolidation of the Corporation with any other corporation as a
result of which the holders of the voting capital stock of the
Corporation as a group would receive less than 50% of the voting
capital stock of the surviving or resulting corporation, (ii) the
approval by the Board of Directors of an agreement providing for
the sale or transfer (other than as security for obligations of
the Corporation) of substantially all the assets of the
Corporation, or (iii) in the absence of a prior expression of
approval by the Board of Directors, the acquisition of more than
20% of the Corporation's voting capital stock by any person
within the meaning of Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended, other than a person, or group including
a person, who beneficially owned, as of the effective date of the
Plan, more than five percent of the Corporation's securities;
then any Option granted hereunder shall become immediately
exercisable in full, subject to any appropriate adjustments in
the number of shares subject to the Option and the option
exercise price per share, and shall remain exercisable for the
remaining term of such Option, regardless of whether such Option
has been outstanding for six months or of any provision contained
in the Stock Option Agreement with respect thereto requiring that
the Option or any portion thereof be outstanding for a minimum
amount of time prior to exercise, subject to all of the terms
hereof and the Stock Option Agreement with respect thereto not
inconsistent with this paragraph.
(d) Anything contained herein to the contrary
notwithstanding, upon the dissolution or liquidation of the
Corporation each Option granted under the Plan shall terminate;
provided, however, that following the adoption of a plan of
dissolution or liquidation, and in any event prior to such
dissolution or liquidation (and as provided above regarding
certain mergers and consolidations), each Option granted
hereunder shall be exercisable in full, regardless of whether
such Option has been outstanding for six months or of any
provision contained in the Stock Option Agreement with respect
thereto requiring that the Option or any portion thereof be
outstanding for a minimum amount of time prior to exercise,
subject to all of the terms hereof and of the Stock Option
Agreement with respect thereto not inconsistent with this
paragraph.
The grant of an Option pursuant to this Plan shall not
affect in any way the right or power of the Corporation or any of
its Subsidiaries to make adjustments, reclassifications,
reorganizations, or changes of its capital or business structure,
or to merge or consolidate, or to dissolve, liquidate or sell, or
transfer all or part of its business or assets.
Section 3.9 Non-Transferability of Options. No Option
granted under the Plan shall be transferable by the Optionee
other than by will, or, if Optionee dies intestate, by the laws
of descent and distribution of the state of Optionee's domicile
at the time of death. During the Optionee's lifetime, the Option
shall be exercisable only by the Optionee.
Article IV - Incentive Stock Options
Section 4.1 Committee Discretion. The Committee may in its
sole discretion designate certain Options granted pursuant to the
Plan as Incentive Stock Options. Incentive Stock Options shall
be subject to Section 4.2 hereof and all other terms and
conditions of the Plan, except to the extent that such terms and
conditions conflict with the provisions of Section 4.2 hereof, in
which case section 4.2 shall control.
Section 4.2 Additional Conditions Applicable to Incentive
Stock Options.
(a) Incentive Stock Options shall not be granted more than
10 years after the effective date of the Plan, and shall not be
exercisable after the expiration of ten years from the date the
Incentive Stock Option was granted.
(b) No person may be granted an Incentive Stock Option in
any calendar year if the aggregate Fair Market Value (determined
as of the time the Option is granted) of the stock with respect
to which incentive stock options are exercisable for the first
time by such employee during any calendar year, under this and
all other incentive stock option plans (as defined in Section 422
of the Code) of the Corporation or its Subsidiaries, would exceed
$100,000.
(c) Except as provided in Section 4.3 hereof, no person
shall be eligible to receive an Incentive Stock Option if such
person would beneficially own, directly or indirectly, capital
stock of the Corporation possessing more than ten percent of the
total combined voting power of all classes of capital stock of
the Corporation. For purposes of the preceding sentence, the
rules of Section 424(d) of the Code shall apply, and capital
stock of the Corporation which an employee may purchase under
outstanding options shall be treated as stock owned by such
employee.
Section 4.3 Ten Percent Shareholders. Notwithstanding the
provisions of Section 4.2(c) regarding the ineligibility of
certain ten percent owners of the Corporation's capital stock,
any Key Employee deemed to be ineligible pursuant to the
provisions of Section 4.2(c) hereof may be granted an Option
hereunder which (i) provides for an option price of at least 110%
of the Fair Market Value of the stock at the time of the granting
of the Option, (ii) is not exercisable after the expiration of
five years from the date such Option is granted, and (iii) is
subject to all of the other terms and conditions of the Plan.
Section V - Miscellaneous Provisions
Section 5.1 Amendment and Termination. The Plan may be
amended or terminated by the Board of Directors without
shareholder approval as deemed in the best interests of the
Corporation, provided that the Board of Directors shall submit
any amendments to the shareholders for approval to the extent
necessary to maintain compliance with the requirements of Rule
16b-3 of the Securities and Exchange Act of 1934, as amended.
Section 5.2 Effective Date of the Plan. Effectiveness of
the Plan is subject to approval by the shareholders of the
Corporation within 12 months from the date the Plan is adopted by
the Board of Directors. Notwithstanding any other provision
hereof, options may be granted under the Plan prior to obtaining
shareholder approval, however no Option granted hereunder may be
exercised prior to approval of the Plan by the shareholders of
the Corporation and, in the event the shareholders do not approve
the Plan within one year from the effective date of the Plan, all
Options granted hereunder shall be void.
