Registration No. 333-35905
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 1 ON
FORM S-8
TO REGISTRATION STATEMENT ON FORM S-4
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) Identification No.)
22 Union Street, North
Concord, North Carolina 28025
(Address of Principal Executive Offices)
CAROLINA STATE BANK
1991 INCENTIVE STOCK OPTION PLAN
LAWRENCE M. KIMBROUGH
President and Chief Executive Officer
First Charter Corporation
22 Union Street, North
Concord, North Carolina 28025
(Name and Address of Agent For Service)
(704) 786-3300
(Telephone Number, Including Area Code, of Agent For Service)
Copy To:
ANNE TEAM KELLY
Smith Helms Mulliss & Moore, L.L.P.
Post Office Box 31247
Charlotte, North Carolina 28231
(704) 343-2000
This Post-Effective Amendment No. 1 covers shares of the
Registrant's Common Stock originally registered on the
Registration Statement on Form S-4 to which this is an amendment.
The registration fees in respect of such Common Stock were paid
at the time of the original filing of the Registration Statement
on Form S-4 relating to such Common Stock.
<PAGE>
PART I. INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents constituting the Prospectus (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 Robert O.
Bratton, Executive Vice President, First Charter Corporation,
Post Office Box 228, Concord, North Carolina 28026-0228.
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, 1996;
(b) The Registrant's Quarterly Reports on Form 10-Q
for the quarters ended March 31, 1997, June 30, 1997 and
September 30, 1997;
(c) The Registrant's Current Reports on Form 8-K filed
on July 2, 1997, August 18, 1997, January 6, 1998 and
January 28, 1998; and
(d) The description of the Registrant's Common Stock
contained in its registration statement filed pursuant to
Section 12 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and any amendment or report
filed for the purpose of updating such description,
including the Registrant's Current Report on Form 8-K filed
on January 28, 1998.
All documents 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 that 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 or therein 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 that also is or is deemed to be incorporated by
reference herein 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.
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 Robert O. Bratton, Executive Vice
President, First Charter Corporation, Post Office Box 228,
Concord, North Carolina 28026-0228. 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 Plans has been passed upon by Smith Helms
Mulliss & Moore, L.L.P., Charlotte, North Carolina. As of the
date of this Post-Effective Amendment No. 1 on Form S-8, certain
attorneys of Smith Helms Mulliss & Moore, L.L.P., beneficially
owned approximately 8,800 shares of the Registrant's Common
Stock.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
There are no provisions in the Registrant's Restated
Articles of Incorporation, contracts between the Registrant and
its directors and officers or resolutions adopted by the
Registrant relating to indemnification. The Registrant's
Restated Articles of Incorporation prevent the recovery by the
Registrant of monetary damages against its directors. However,
in accordance with the provisions of the North Carolina Business
Corporation Act (the "Act"), the Registrant's Amended and
Restated 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 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 current 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 interests, 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 current
or former 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 in which he was
adjudged liable on such basis. The above standard of conduct is
determined by the Board of Directors or a committee thereof 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 because of his capacity as
a director or officer 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 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 permits a corporation to
provide for indemnification of directors, officers, employees or
agents, in its articles of incorporation or bylaws 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
containing detailed specific provisions regarding the
circumstances under which and the person for whose benefit
indemnification shall or may be made and accordingly are
incorporated herein by reference as Exhibit 99.2.
ITEM 8. EXHIBITS.
The following exhibits are filed with or incorporated by
reference in this Registration Statement.
Exhibit No. Description of Exhibit
5.1 Opinion of Smith Helms Mulliss & Moore,
L.L.P. as to legality of securities.*
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Smith Helms Mulliss & Moore,
L.L.P. (included in Exhibit 5.1).
24.1 Power of Attorney and Certified
Resolutions.*
99.1 Carolina State Bank 1991 Incentive Stock
Option Plan, as amended on November 19,
1996.
99.2 Provisions of North Carolina law
relating to indemnification of directors
and officers.*
____________________
* Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-4 to which this is Post-Effective
Amendment No. 1.
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;
(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;
(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, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section
13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new Registration Statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered
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,
each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) 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 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 Securities 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 Securities 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, State of North Carolina, on
March 19, 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 date indicated.
Signature Title Date
/s/ LAWRENCE M. KIMBROUGH President, Chief Executive
(Lawrence M. Kimbrough) Officer and Director
(Principal Executive Officer) March 19, 1998
/s/ ROBERT O. BRATTON Executive Vice President
(Robert O. Bratton) (Principal Financial and
Principal Accounting Officer) March 19, 1998
______________________ Director March __, 199
(William R. Black)
MICHAEL R. COLTRANE* Director March 19, 1998
(Michael R. Coltrane)
J. ROY DAVIS, JR.* Director March 19, 1998
(J. Roy Davis, Jr.)
______________________ Director March __, 1998
(T. Carl Dedmon)
JAMES B. FINCHER* Director March 19, 1998
(James B. Fincher)
______________________ Director March __, 1998
(John J. Godbold, Jr.)
H. CLARK GOODWIN* Director March 19, 1998
(H. Clark Goodwin)
______________________ Director March __, 1998
(Charles F. Harry III)
FRANK H. HAWFIELD, JR.* Director March 19, 1998
(Frank H. Hawfield, Jr.)
J. KNOX HILLMAN, JR.* Director March 19, 1998
(J. Knox Hillman, Jr.)
BRANSON C. JONES* Director March 19, 1998
(Branson C. Jones)
JERRY E. MCGEE* Director March 19, 1998
(Jerry E. McGee)
HUGH H. MORRISON* Director March 19, 1998
(Hugh H. Morrison)
_____________________ Director March __, 1998
(Thomas R. Revels)
*By:/s/ LAWRENCE M. KIMBROUGH
Lawrence M. Kimbrough
Attorney-in-Fact
INDEX TO EXHIBITS
Exhibit No. Description of Exhibit
5.1 Opinion of Smith Helms Mulliss & Moore,
L.L.P. as to legality of securities.*
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Smith Helms Mulliss & Moore,
L.L.P. (included in Exhibit 5.1).
24.1 Power of Attorney and Certified
Resolutions.*
99.1 Carolina State Bank 1991 Incentive Stock
Option Plan, as amended on November 19,1996.
99.2 Provisions of North Carolina law relating
to indemnification of directors and officers.*
____________________
* Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-4 to which this is Post-Effective
Amendment No. 1.
KPMG Peat Marwick LLP
Suite 2800
Two First Union Center
Charlotte, NC 28282-8290
The Board of Directors
First Charter Corporation:
We consent to the incorporation by reference in the Post-
Effective Amendment No. 1 on Form S-8 To Registration Statement
on Form S-4 of First Charter Corporation of our report on the
consolidated financial statements included in the 1996 Annual
Report to Shareholders which is incorporated by reference in the
1996 Form 10-K of First Charter Corporation.
/s/ KPMG PEAT MARWICK LLP
KPMG PEAT MARWICK LLP
Charlotte, North Carolina
March 18, 1998
CAROLINA STATE BANK
1991 INCENTIVE STOCK OPTION PLAN
AMENDED NOVEMBER 19, 1996
Carolina State Bank, a Banking corporation organized and
existing under the laws of the State of North Carolina (herein
referred to as the "Bank"), hereby adopts the following Stock
Option Plan (the "Plan") for certain individuals performing
services for the Bank.
1. Purpose. This Plan is intended to advance the
interests of the Bank by allowing officers and other key
employees who have substantial responsibility for the direction
and management of the Bank to acquire a proprietary interest in
the Bank as an additional incentive to promote the Bank's
success, and by encouraging such individuals to continue to
provide their services to the Bank. These aims will be effected
by the granting of certain stock options. It is intended that
options issued under the Plan and designated by the Committee
(define hereinafter) pursuant to Section 3(b) hereof will qualify
as Incentive Stock Options (hereinafter called "ISO's") under
Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), and the terms of the Plan shall be interpreted in
accordance with this intention. Options granted under this Plan
are referred to hereinafter as "Options."
2. Plan. The Plan shall be administered by the
Compensation Committee (the "Committee") of the Board of
Directors ("the Board") of the Bank, which shall consist of not
less than three members, none of whom may participate in the
Plan. Subject to the provisions of the Plan, the Committee shall
have full authority, in its discretion, to (a) determine the
employees (from the class of employees eligible under Section 3
hereof to receive Options under the Plan) to whom Options shall
be granted; (b) determine the time or times at which Options
shall be granted; (c) determine the options price of the Shares
(defined hereinafter) subject to each Option, which price shall
be not less than the minimum specified in accordance with Section
5 hereof; (d) determine (subject to Sections 7 and 9 hereof) the
time or times when each Option shall become exercisable and the
duration of the exercise; and (e) interpret the Plan and
prescribe, amend, and rescind rules and regulations relating to
it. The interpretation and construction of any provision of the
Plan by the Committee shall be final and conclusive. The
Committee may consult with counsel and other professional
advisors, who may be counsel or advisors to the Bank, and shall
not incur any liability for any action taken in good faith in
reliance upon the advice of such counsel or advisors.
3. Eligibility. (a) Options may be granted by the
Committee only to persons who are officers or other key employees
of the Bank or a subsidiary corporation of the Bank who perform
services of major importance in the management, operation, and
development of the business of the Bank or of any subsidiary of
the Bank, and the Committee shall determine the number of shares
to be allocated to each Option. In determining the eligibility
of an employee to receive an Option as well as in determining the
number of Shares to be optioned to any individual, the Committee
shall consider the position and responsibilities of the
individual being considered, the nature and value to the Bank of
such individual's services and accomplishments, the person's
present and potential contributions to the success of the Bank,
and such other factors as the Committee may deem relevant. A
person receiving an Option pursuant to this Plan shall sometimes
be referred to hereinafter as an "Optionee."
(b) At the time each Option is granted to an employee
under this Plan, the Committee shall determine whether such
Option is to be designated as an ISO. No Option granted to
any employee who at the time of such grant owns stock
possessing more than 10% of the total combined voting power
of all classes of stock of the Bank or any of its
subsidiaries may be designated as an ISO, unless at the time
of such grant the option price is fixed at not less than
110% of the fair market value of the Shares subject to the
Option, and exercise of such Option is prohibited by its
terms after the expiration of five years from the date such
Option is granted.
(c) No individual shall be given the opportunity under
this Plan to exercise Options for Shares valued (at the time
of the granting of the Option) in excess of $100,000 in any
calendar year, unless and except to the extent that said
Options shall have first become exercisable in a preceding
year. No Option shall be granted hereunder for the purchase
of Shares in such a manner as would cause the foregoing
restriction to be violated.
(d) Notwithstanding anything herein to the contrary,
no individual may be granted Options under the Plan which
would result in the total number of Shares at any time
optioned and/or purchased under the Plan by such individual
to exceed 40% of the total Shares allocated to this Plan
pursuant to Section 11 hereof, or, if greater, the maximum
percentage permitted by the North Carolina Commissioner of
Banks.
4. Shares of Stock Subject to the Plan. There will be
reserved for use upon the exercise of Options to be granted from
time to time under the Plan (subject to the provisions of Section
6 hereof) an aggregate of 70,000 Shares of the $6.00 par value
common stock (the "Shares") of the Bank, which, as the Committee
shall from time to time determine, may be in whole or in part
either authorized by unissued Shares, or issued Shares which
shall have been reacquired by the Bank.
Any Shares subject to an Option under the Plan, which Option
for any reason expires or is terminated unexercised as to such
Shares, may again be subjected to an Option under the Plan.
5. Option Price. The purchase price under each Option
issued shall be determined by the Committee at the time the
Option is granted, but in no event shall such purchase price be
less than 100% (110% in the case of an ISO granted to an employee
described in Section 3(b) hereof) of the fair market value of the
Bank's Shares on the date of the grant. If the Shares are traded
in any over-the-counter market, such fair market value shall be
deemed to be the mean between the asked and the bid prices on
such day as reported by NASDAQ. If the Shares are traded on an
exchange, such fair market value shall be deemed to be the mean
of the high and low prices at which it is quoted or traded on
such day on the exchange on which it generally has the greatest
trading volume. In all cases, any determination hereunder by the
Committee as to the fair market value of the Shares for which
Options are granted shall be made in good faith and shall be
determinative for all purposes of this Plan.
6. Adjustment for Dilution, Etc. In the event that there
is (a) a subdivision of consolidation of the Bank's common stock
or any other capital adjustment of the Bank's common stock, (b)
the payment by the Bank of a stock dividend, or (c) any other
increase or decrease in the outstanding common stock of the Bank
effected without receipt of consideration by the Bank, then the
number of Shares then covered by each outstanding Option granted
hereunder shall be adjusted proportionately with no adjustment in
the total purchase price of the Shares then so covered by such
Option, and the number of Shares reserved for the purpose of the
Plan shall be adjusted by the same proportion. All such
adjustments shall be made by the Committee, whose determination
upon the same shall be final and binding upon the Optionees. No
fractional Shares shall be issued and any fractional Shares
resulting from the computations pursuant to this Section 6 shall
be eliminated from the respective Option. No adjustment shall be
made for cash dividends or the issuance to stockholders of rights
to subscribe for additional Shares or other securities.
7. Duration and Exercise of Options. (a) All Options
issued under the Plan shall be for such period as the Committee
shall determine, but for not more than ten years (five years in
the case of any employee described in Section 3(b) hereof) from
the date of the grant thereof. The period of the Option, once it
is granted, may be reduced only as outlined in Section 9 hereof.
Except as provided in Section 9 or subsection (b) below, no
Option may be exercised after termination of the Optionee's
employment with the Bank, and in no event may an option be
exercised after the expiration of its term.
(b) Except as otherwise modified by the Committee, or
as otherwise expressly provided for herein, each Option
granted under this Plan shall become exercisable only after
five years' continued employment of the Optionee with the
Bank or subsidiary corporation of the Bank immediately
following the date the Option is granted. Notwithstanding
the preceding sentence, in the event an employee's
employment with the Bank shall terminate for any reason
during such five-year period, such former employee may,
within three months after termination of his employment,
exercise his option with respect to the vested portion of
the Shares subject to the Option, determined in accordance
with and based on the whole number of years of the
Optionee's continued employment with the Bank or subsidiary
corporation of the Bank from the date the Option is granted
through the date of Optionee's termination of employment,
determined in accordance with the following schedule:
Years of Percentage of
Continued Employment Shares Vested
1 20%
2 40%
3 60%
4 80%
5 100%
In the event an Optionee terminates employment within the five-year
period described above, all Shares not vested in accordance
with the Schedule described above shall be forfeited, and the
Optionee shall have no right to exercise his Option with respect
to any such forfeited Shares. In each case, such limitations
shall be calculated, in the case of the resulting fraction to the
nearest low whole number of Shares. Notwithstanding the
foregoing, the Committee may, in its sole discretion, (i)
prescribe longer time periods and additional requirements with
respect to the exercise of an Option, (ii) prescribe different
vesting schedules with respect to any Option, and (iii) terminate
in whole or in part such portion of any Options as has not yet
become exercisable at the time of termination if it determines
that the Optionee is not performing satisfactorily the duties to
which he was assigned on the date the Option was granted or
duties of at least equal responsibility. Except as provided
herein or in Section 9 hereof, no Option may be exercised unless
the Optionee is at the time of such exercise in the employ of the
Bank or of a subsidiary corporation of the Bank, and shall have
been continuously so employed since the granting of his Option.
Absence or leave approved by the management of the Bank, provided
said leave of absence does not exceed ninety (90) days, shall not
be considered an interruption of employment for any purpose under
the Plan.
(c) Subject to limitations contained herein as to the
time for exercise of an Option and the amount of Shares
subject to such Option, and notwithstanding subsection (b)
above, each Option shall be exercisable in whole or in part
or in installments at such time or times and in such manner
as the Committee may prescribe and specify in granting the
Option to the Optionee, which manner may differ from the
exercise periods otherwise prescribed in subsection (b)
above. No Shares shall be delivered pursuant to any
exercise of an Option until the requirements of such laws
and regulations as may be deemed by the Committee to be
applicable to them have been satisfied, and further until
receipt by the Bank of the full option price in cash for the
Shares for which an Option is exercised. In order to
facilitate the accumulation of funds to enable employees to
exercise their Options, each Optionee shall have the right,
if he or she so elects, to direct the Bank or subsidiary
corporation of the Bank to withhold from his or her
compensation regular amounts to be applied toward the
exercise of the Options. Funds credited to the Stock Option
accounts will be under the control of the Bank until applied
to the payment of the Option price at the direction of the
employee or returned to the employee in the event the amount
is to be used for purchase of Shares under Option, and all
funds received or held by the Bank under the Plan may be
used for any corporate purpose, and no interest shall be
payable to the participant on account of any amounts so
held. Such amounts may be withdrawn by the employee at any
time, in whole or in part, for any reason.
(d) No Optionee or his legal representative, legatees,
or distributees, as the case may be, will be, or will be
deemed to be, a holder of any Shares subject to an Option
unless and until certificates for such Shares are issued to
him or them under the terms of the Plan. Except as
otherwise provided herein, no adjustment shall be made for
dividends or other rights for which the record date is prior
to the date such stock certificate is issued.
(e) "Notwithstanding any provision in the Plan to the
contrary, payment for shares subject to an Option may be
made either in cash or, with the approval of the Committee,
in other stock of the Bank owned by the Optionee or such
other person as may be entitled to exercise such Option.
Any shares of the Bank's stock that are delivered in payment
of the aggregate exercise price of the Option shall be
valued at their fair market value, as determined by the
Committee, on the date of the exercise of such Option."
(f) "In the event of a reorganization, merger, or
consolidation of the Bank with one or more other
corporations in which the Bank is not the surviving
corporation, or the transfer of all or substantially all of
the assets or shares of the Bank to another person or
entity, or in the case of a tender offer approved by the
Board or dissolution or liquidation of the Bank (any such
transaction being hereinafter referred to as an
"Acceleration Event"), (i) any outstanding Options granted
hereunder shall become exercisable in full immediately prior
to the effective date of the Acceleration Event without any
regard to any restrictions on exercise that would otherwise
apply, and (ii) each holder of an Option shall be entitled,
prior the effective date of the Acceleration Event, to
surrender any such Option to the Bank in exchange for
receipt of cash equivalent to the amount by which the fair
market value of the shares subject to the Option immediately
prior to consummation of the Acceleration Event exceeds the
aggregate exercise price of the Option. To the extent that
a person, pursuant to this Subsection 17(f), has a right to
exercise or surrender any Option on account of an
Acceleration Event which such person otherwise would not
have had at that time, such right shall be contingent upon
the consummation of the Acceleration Event."
8. Assignability. Each Option granted under this Plan
shall be transferable only by Will or by laws of descent and
distribution and shall be exercisable during an Optionee's
lifetime, only by the Optionee to whom the Option is granted.
Except as permitted by the preceding sentence, no Option granted
under the Plan or any of the rights and privileges thereby
conferred shall be transferred, assigned, pledged, or
hypothecated in any way (whether by operation of law or
otherwise), and no such Option, right or privilege shall be
subject to execution, attachment, or similar process. Upon any
attempt so to transfer, assign, pledge, hypothecate, or otherwise
dispose of the Option or any right or privilege conferred
thereby, contrary to the provisions hereof, or upon the levy of
any attachment or similar process upon such Option, right, or
privilege, the Option and such rights and privileges shall
immediately become null and void.
9. Effect of Termination of Employment, Death, or
Disability. (a) Notwithstanding anything in this Plan to the
contrary, in the event an Optionee's employment shall be
terminated by reason of the Optionee's retirement at his
Retirement Date (defined hereinafter) the Optionee shall have the
right to exercise such Option or Options held by him, to the
extent that such Options have not previously expired or been
exercised, at any time within three months after such retirement;
upon such retirement, all Options held by such Optionee which
have not been theretofore exercised by him or otherwise expired
shall be immediately vested and exercisable in full,
notwithstanding Section 7(b) or (c) hereof.
(b) In the event that an Optionee shall die while
employed by the Bank, or shall die within three months after
retirement on or after his Retirement Date, any Option or
Options granted to him under this Plan which have not
previously expired or been exercised shall be exercisable by
the estate of the Optionee (or by any person who acquired
such Option by bequest or inheritance from the Optionee) in
full, notwithstanding Section 7(b) or (c) hereof, any time
within one year after the death of the Optionee. References
herein to the Optionee shall be deemed to include any person
entitled to exercise the Option after the death of the
Optionee under the terms of this Section 9(b).
(c) In the event of an Optionee's termination of
employment by reason of the Optionee's disability, the
Optionee shall have the right, notwithstanding Section 7(b)
or (c) hereof, to exercise all Options held by him to the
extent that such Options have not previously expired or been
exercised, Options held by such Optionee which have not been
theretofore exercised by him or otherwise expired shall be
immediately exercisable in full, notwithstanding Section
7(b) or (c) hereof. The term "disability" shall, for the
purposes of this Plan, be defined in the same manner as such
term is defined in Section 22(e)(3) of the code.
(d) For the purposes of this Plan, "Retirement Date"
shall mean, any date an employee is otherwise entitled to
retire under any of the Bank's retirement plans, or if no
such retirement plans exist, then the date on which the
Optionee attains age 65.
10. Listing and Registration of Shares. Each Option shall
be subject to the requirement that if at any time the Committee
shall determine, in its discretion, that the listing,
registration, or qualification of the Shares covered thereby upon
any securities exchange or any state or federal law, or the
consent or approval of any government regulatory body, is
necessary or desirable as a condition of, or in connection with,
the granting of such Option or the issue or purchase of Shares
thereunder, such Option may not be exercised in whole or in part
unless and until listing, registration, qualification, consent,
or approval shall have been effected or obtained free of any
conditions not acceptable to the Committee. The Bank shall not
be required to issue or deliver any certificate for Shares of its
stock purchased upon the exercise of any part of an Option before
(i) the admission of such Shares to listing on any stock exchange
in which the stock of the Bank may then be listed, (ii)
completion of any registration or other qualification of such
Shares under any state or federal law or ruling or regulation of
any governmental regulatory body that the Bank shall, in its sole
discretion, determine is necessary or advisable, and (iii) the
Committee shall have been advised by counsel that all applicable
legal requirements have been complied with and satisfied.
11. Expiration and Termination of the Plan. Options may be
granted under the Plan at any time or from time to time so long
as the total number of Shares at any one time option and/or
purchased under this Plan does not exceed 70,000 Shares. The
Plan may be abandoned or terminated at any time by the Board
except with respect to any Options than outstanding under the
Plan. No option shall be granted pursuant to the Plan after ten
years from the effective date of the Plan.
12. Amendment of Plan. The Board may at any time and from
time to time modify and amend the Plan (including the form of any
option agreement to be executed pursuant thereto) in any
respects; provided, however, that no such amendment shall: (a)
increase (except in accordance with Section 6 hereof) the maximum
number of Shares for which Options may be granted under the Plan
either in aggregate or to any individual; (b) reduce (except in
accordance with Section 6 hereof) the minimum option prices which
may be established under the Plan; (c) extend the period or
periods during which Options may be granted or exercised; (d)
change the provisions relating to the determination of
individuals to whom Options shall be granted and the number of
Shares to be covered by such Options; or (e) change the
provisions relating to adjustments to be made upon changes in
capitalization. The termination or any modification or amendment
of the Plan shall not, without the consent of the Optionee,
affect such Optionee's rights under an Option theretofore granted
to him.
13. Applicability of Plan to Outstanding Stock Options.
This Plan shall not affect the terms and conditions of any
non-qualified stock options heretofore granted to any individual
by the Bank under any other plan or agreement relating to
non-qualified stock options, nor shall it affect any of the
rights of any individuals to whom such a non-qualified stock
option was granted.
14. Effective Date of Plan. This Plan shall become
effective upon adoption by the Board, subject to approval by the
shareholders of the Bank. This Plan shall not become effective
unless such shareholder approval shall be obtained within twelve
months before or after the adoption of the Plan by the Board.
