Registration No. 333-_______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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STATE FINANCIAL SERVICES CORPORATION
(Exact name of registrant as specified in its charter)
Wisconsin 39-1489983
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10708 W. Janesville Road 53130
Hales Corners, Wisconsin (Zip Code)
(Address of principal executive offices)
Home Bancorp of Elgin, Inc. 1997 Stock Option Plan
(Full title of the plan)
Michael J. Falbo
President and Chief Executive Officer Copy to:
State Financial Services Corporation Ulice Payne, Jr.
10708 W. Janesville Road Foley & Lardner
Hales Corners, Wisconsin 53130 777 East Wisconsin Avenue
(414) 425-1600 Milwaukee, Wisconsin 53202
(Name, address and telephone number, (414) 271-2400
including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
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Proposed
Proposed Maximum
Title of Amount Maximum Aggregate Amount of
Securities to be to be Offering Price Offering Registration
Registered Registered Per Share Price Fee
- ------------------------ ---------------------- ---------------------- ------------------------- -------------------
Common Stock,
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$.10 par value 640,645 shares $16.85(1) $10,794,868.25(1) $3,000.98(2)
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(1) Estimated pursuant to Rule 457(h) under the Securities Act of 1933, as
amended, based on an exercise price of $16.85 per share of the
Registrant's Common Stock, par value $.10 per share.
(2) The registration fee has been calculated pursuant to Section 6(b) of the
Securities Act as follows: .000278 times the Proposed Maximum Offering
Price.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document or documents containing the information specified in Part
I are not required to be filed with the Securities and Exchange Commission
("Commission") as part of this Form S-8 Registration Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by State Financial Services Corporation
(the "Company") with the Commission are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997, which includes audited financial statements as of and for the
year ended December 31, 1997.
(b) All other reports filed by the Company pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
since December 31, 1997.
(c) The description of the Company's Common Stock contained in Item 1
of the Company's Registration Statement on Form 8-A, dated June 4, 1990, filed
with the Commission pursuant to Section 12 of the Exchange Act, and any
amendments or reports filed for the purpose of updating such description.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of filing of this
Registration Statement and prior to such time as the Company files a
post-effective amendment to this Registration Statement which indicates that all
securities offered hereby have been sold or which deregisters all securities
then remaining unsold shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of such
documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
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Item 6. Indemnification of Directors and Officers.
Pursuant to the provisions of the Wisconsin Business Corporation Law
("WBCL"), directors and officers of the Company are entitled to mandatory
indemnification from the Company against certain liabilities (which may include
liabilities under the Securities Act of 1933) and expenses (i) to the extent
that such officers or directors are successful in the defense of a proceeding;
and (ii) in proceedings in which the director or officer is not successful in
the defense thereof, unless it is determined that the director or officer
breached or failed to perform his or her duties to the Company and such breach
or failure to perform constituted: (a) a wilful failure to deal fairly with the
Company or its shareholders in connection with a matter in which the director or
officer had a material conflict of interest; (b) a violation of criminal law,
unless the director or officer had reasonable cause to believe his or her
conduct was lawful or had no reasonable cause to believe his or her conduct was
unlawful; (c) a transaction from which the director or officer derived an
improper personal profit; or (d) wilful misconduct.
Additionally, under the WBCL, directors of the Company are not subject
to personal liability to the Company, its shareholders or any person asserting
rights on behalf thereof, for certain breaches or failures to perform any duty
resulting solely from their status as directors, except in circumstances
paralleling those outlined in (a) through (d) above.
The Company's By-Laws contain similar indemnification provisions as to
its officers and directors.
The indemnification provided by the WBCL and the Company's By-Laws is
not exclusive of any other rights to which a director or officer of the Company
may be entitled. The Company also carries directors' and officers' liability
insurance.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
The following exhibits have been filed (except where otherwise
indicated) as part of this Registration Statement:
Exhibit No. Exhibit
(4.1) Home Bancorp of Elgin, Inc. 1997 Stock Option Plan
(4.2) Form of Stock Option Agreement for Officers and Employees
under the Home Bancorp of Elgin, Inc. 1997 Stock Option Plan
(4.3) Form of Stock Option Agreement for Outside Directors under the
Home Bancorp of Elgin, Inc. 1997 Stock Option Plan
(5) Opinion of Foley & Lardner
(23.1) Consent of Foley & Lardner (included in Exhibit 5 hereof)
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(23.2) Consent of Ernst & Young LLP
(24) Power of Attorney relating to subsequent amendments (included
on the signature page to this Registration Statement)
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 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.
(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 herein, 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 this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, 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 the 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.
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SIGNATURES
The Registrant. 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 Hales Corners, and State of Wisconsin, on this
7th day of January, 1999.
STATE FINANCIAL SERVICES
CORPORATION
By: /s/Michael J. Falbo
Michael J. Falbo,
President and Chief Executive Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated. Each person whose signature appears below
constitutes and appoints Michael J. Falbo and Michael A. Reindl, and each of
them individually, his or her true and lawful attorney-in-fact and agent, with
full power of substitution and revocation, for him or her and in his or her
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he or she might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or either of them, may lawfully do or cause to be
done by virtue hereof.
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Signature Title Date
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/s/Michael J. Falbo President, Chief Executive Officer January 7, 1999
Michael J. Falbo (Principal Executive Officer) and
Director
/s/Michael A. Reindl Senior Vice President, Controller and January 7, 1999
Michael A. Reindl Chief Financial Officer (Principal
Financial and Accounting Officer)
Jerome J. Holz Chairman of the Board, Vice President January 7, 1999
Jerome J. Holz and Director
/s/Richard A. Horn Director January 7, 1999
Richard A. Horn
/s/Barbra E. Holz-Weis Director January 7, 1999
Barbara E. Holz-Weis
/s/David M. Stamm Director January 7, 1999
David M. Stamm
/s/Ulice Payne, Jr. Director January 7, 1999
Ulice Payne, Jr.
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EXHIBIT INDEX
HOME BANCORP OF ELGIN, INC.
1997 STOCK OPTION PLAN
Exhibit No. Exhibit Sequentially
Numbered Page
(4.1) Home Bancorp of Elgin, Inc. 1997 Stock
Option Plan
(4.2) Form of Stock Option Agreement for Officers
and Employees under the Home Bancorp of
Elgin, Inc. 1997 Stock Option Plan
(4.3) Form of Stock Option Agreement for Outside
Directors under the Home Bancorp of Elgin,
Inc. 1997 Stock Option Plan
(5) Opinion of Foley & Lardner
(23.1) Consent of Foley & Lardner (included in
Exhibit 5 hereof)
(23.2) Consent of Ernst & Young LLP
(24) Power of Attorney relating to subsequent ___
amendments (included on the signature page to
this Registration Statement)
Exhibit 4.1
HOME BANCORP OF ELGIN, INC.
1997 STOCK OPTION PLAN
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Adopted January 16, 1997
Effective as of April 17, 1997
Incorporating Amendments No. 1 and 2
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TABLE OF CONTENTS
Page
Article I Purpose
Section 1.1 General Purpose of the Plan..................................1
Article II Definitions
Section 2.1 Association..................................................1
Section 2.2 Board........................................................1
Section 2.3 Change in Control............................................1
Section 2.4 Code.........................................................2
Section 2.5 Committee....................................................2
Section 2.6 Company......................................................2
Section 2.7 Disability...................................................2
Section 2.8 Disinterested Board Member...................................3
Section 2.9 Effective Date...............................................3
Section 2.10 Eligible Director............................................3
Section 2.11 Eligible Employee............................................3
Section 2.12 Employer.....................................................3
Section 2.13 Exchange Act.................................................3
Section 2.14 Exercise Price...............................................3
Section 2.15 Fair Market Value............................................3
Section 2.16 Family Member................................................4
Section 2.17 Incentive Stock Option.......................................4
Section 2.18 Non-Profit Organization......................................4
Section 2.19 Non-Qualified Stock Option...................................4
Section 2.20 Option.......................................................4
Section 2.21 Option Period................................................4
Section 2.22 OTS Regulations..............................................4
Section 2.23 Person.......................................................4
Section 2.24 Plan.........................................................4
Section 2.25 Retirement...................................................4
Section 2.26 Share........................................................4
Section 2.27 Termination for Cause........................................5
Article III Available Shares
Section 3.1 Available Shares.............................................5
Article IV Administration
Section 4.1 Committee....................................................6
Section 4.2 Committee Action.............................................6
Section 4.3 Committee Responsibilities...................................6
Article V Stock Options For Eligible Directors
Section 5.1 In General...................................................7
(i)
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Section 5.2 Exercise Price...............................................7
Section 5.3 Option Period................................................7
Article VI Stock Options For Eligible Employees
Section 6.1 Size of Option...............................................9
Section 6.2 Grant of Options.............................................9
Section 6.3 Exercise Price...............................................9
Section 6.4 Option Period...............................................10
Section 6.5 Required Regulatory Provisions..............................10
Section 6.6 Additional Restrictions on Incentive Stock Options..........12
Article VII Options - In General
Section 7.1 Method of Exercise..........................................13
Section 7.2 Limitations on Options......................................14
Article VIII Amendment And Termination
Section 8.1 Termination.................................................15
Section 8.2 Amendment...................................................15
Section 8.3 Adjustment in the Event of a Business Reorganization........15
Article IX Miscellaneous
Section 9.1 Status as an Employee Benefit Plan..........................16
Section 9.2 No Right to Continued Employment............................16
Section 9.3 Construction of Language....................................17
Section 9.4 Governing Law...............................................17
Section 9.5 Headings....................................................17
Section 9.6 Non-Alienation of Benefits..................................17
Section 9.7 Taxes.......................................................17
Section 9.8 Approval of Shareholders....................................17
Section 9.9 Notices.....................................................18
(ii)
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HOME BANCORP OF ELGIN, INC.
ARTICLE I
PURPOSE
Section 1.1 General Purpose of the Plan.
The purpose of the Plan is to promote the growth and profitability of
Home Bancorp of Elgin, Inc., to provide eligible directors, certain key officers
and employees of Home Bancorp of Elgin, Inc. and its affiliates with an
incentive to achieve corporate objectives, to attract and retain individuals of
outstanding competence and to provide such individuals with an equity interest
in Home Bancorp of Elgin, Inc.
ARTICLE II
DEFINITIONS
The following definitions shall apply for the purposes of this Plan,
unless a different meaning is plainly indicated by the context:
Section 2.1 Association means Home Federal Savings and Loan Association
of Elgin, a federally chartered savings institution, and any successor thereto.
Section 2.2 Board means the board of directors of the Company.
Section 2.3 Change in Control means any of the following events:
(a) the occurrence of any event upon which any "person" (as such
term is used in sections 13(d) and 14(d) of the Securities Exchange Act
of 1934, as amended ("Exchange Act")), other than (A) a trustee or other
fiduciary holding securities under an employee benefit plan maintained
for the benefit of employees of the Company; (B) a corporation owned,
directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the
Company; or (C) any group constituting a person in which employees of the
Company are substantial members, becomes the "beneficial owner" (as
defined in Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of securities issued by the Company representing 25% or more
of the combined voting power of all of the Company's then outstanding
securities; or
(b) the occurrence of any event upon which the individuals who on
the date the Plan is adopted are members of the Board, together with
individuals whose election by the Board or nomination for election by the
Company's stockholders was approved by the affirmative vote of at least
two-thirds of the members of the Board then in office who were either
members of the Board on the date this Plan is adopted or whose nomination
or election was previously so approved, cease for any reason to
constitute a majority of the members of the
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Board, but excluding, for this purpose, any such individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of directors of the Company (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act); or
(c) the shareholders of the Company approve either:
(i) a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation following which
both of the following conditions are satisfied:
(A) either (I) the members of the Board of the
Company immediately prior to such merger or consolidation
constitute at least a majority of the members of the
governing body of the institution resulting from such
merger or consolidation; or (II) the shareholders of the
Company own securities of the institution resulting from
such merger or consolidation representing 80% or more of
the combined voting power of all such securities of the
resulting institution then outstanding in substantially the
same proportions as their ownership of voting securities of
the Company immediately before such merger or
consolidation; and
(B) the entity which results from such merger or
consolidation expressly agrees in writing to assume and
perform the Company's obligations under the Plan; or
(ii) a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or
substantially all of its assets; and
(d) any event that would be described in section 2.3(a), (b) or
(c) if "the Association" were substituted for "the Company" therein.
Section 2.4 Code means the Internal Revenue Code of 1986 (including the
corresponding provisions of any succeeding law).
Section 2.5 Committee means the Committee described in section 4.1.
Section 2.6 Company means Home Bancorp of Elgin, Inc., a corporation
organized and existing under the laws of the State of Delaware, and any
successor thereto.
Section 2.7 Disability means a condition of total incapacity, mental or
physical, for further performance of duty with the Company which the Committee
shall have determined, on the basis of competent medical evidence, is likely to
be permanent.
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Section 2.8 Disinterested Board Member means a member of the Board who
(a) is not a current employee of the Company or a subsidiary, (b) is not a
former employee of the Company who receives compensation for prior services
(other than benefits under a tax-qualified retirement plan) during the taxable
year, (c) has not been an officer of the Company, (d) does not receive
remuneration from the Company or a subsidiary, either directly or indirectly, in
any capacity other than as a director and (e) does not possess an interest in
any other transaction, and is not engaged in a business relationship, for which
disclosure would be required pursuant to Item 404(a) or (b) of the proxy
solicitation rules of the Securities and Exchange Commission. The term
Disinterested Board Member shall be interpreted in such manner as shall be
necessary to conform to the requirements of section 162(m) of the Code or Rule
16b-3 promulgated under the Exchange Act.
Section 2.9 Effective Date means April 17, 1997.
Section 2.10 Eligible Director means a member of the board of directors
of an Employer who is not also an employee or an officer of an Employer.
Section 2.11 Eligible Employee means any employee whom the Committee may
determine to be a key officer or employee of an Employer and select to receive a
grant of an Option pursuant to the Plan.
Section 2.12 Employer means the Company, the Association and any
successor thereto and, with the prior approval of the Board, and subject to such
terms and conditions as may be imposed by the Board, any other savings bank,
savings and loan association, bank, corporation, financial institution or other
business organization or institution. With respect to any Eligible Employer or
Eligible Director, the Employer shall mean the entity which employs such person
or upon whose board of directors such person serves.
Section 2.13 Exchange Act means the Securities Exchange Act of 1934, as
amended.
Section 2.14 Exercise Price means the price per Share at which Shares
subject to an Option may be purchased upon exercise of the Option, determined in
accordance with section 5.2.
Section 2.15 Fair Market Value means, with respect to a Share on a
specified date:
(a) the final reported sales price on the date in question (or if
there is no reported sale on such date, on the last preceding date on
which any reported sale occurred) as reported in the principal
consolidated reporting system with respect to securities listed or
admitted to trading on the principal United States securities exchange on
which the Shares are listed or admitted to trading; or
(b) if the Shares are not listed or admitted to trading on any
such exchange, the closing bid quotation with respect to a Share on such
date on the
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National Association of Securities Dealers Automated Quotations System,
or, if no such quotation is provided, on another similar system, selected
by the Committee, then in use; or
(c) if sections 2.15(a) and (b) are not applicable, the fair
market value of a Share as the Committee may determine.
Section 2.16 Family Member means the spouse, parent, child or sibling of
an Eligible Director or Eligible Employee.
Section 2.17 Incentive Stock Option means a right to purchase Shares that
is granted to Eligible Employees pursuant to section 6.1, that is designated by
the Committee to be an Incentive Stock Option and that is intended to satisfy
the requirements of section 422 of the Code.
Section 2.18 Non-Profit Organization means any organization which is
exempt from federal income tax under section 501(c)(3), (4), (5), (6), (7), (8)
or (10) of the Internal Revenue Code.
Section 2.19 Non-Qualified Stock Option means a right to purchase Shares
that is granted pursuant to section 5.1 or 6.1. For Eligible Employees, an
Option will be a Non-Qualified Stock Option if (a) it is not designed by the
Committee to be an Incentive Stock Option, or (b) it does not satisfy the
requirements of section 422 of the Code.
Section 2.20 Option means either an Incentive Stock Option or a
Non-Qualified Stock Option.
Section 2.21 Option Period means the period during which an Option may be
exercised, determined in accordance with Section 5.3 and 6.4.
Section 2.22 OTS Regulations means the regulations issued by the Office
of Thrift Supervision and applicable to the Plan, the Association or the
Company.
Section 2.23 Person means an individual, a corporation, a bank, a savings
bank, a savings and loan association, a financial institution, a partnership, an
association, a joint-stock company, a trust, an estate, an unincorporated
organization and any other business organization or institution.
Section 2.24 Plan means the Home Bancorp of Elgin, Inc. 1997 Stock Option
Plan, as amended from time to time.
Section 2.25 Retirement means retirement at or after the normal or early
retirement date set forth in any tax-qualified retirement plan of the
Association.
Section 2.26 Share means a share of Common Stock, par value $.01 per
share, of Home Bancorp of Elgin, Inc.
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Section 2.27 Termination for Cause means one of the following:
(a) for an Eligible Employee who is not an officer or employee of
any bank or savings institution regulated by the Office of Thrift
Supervision, "Termination for Cause" means termination of employment with
the Employer upon the occurrence of any of the following: (i) the
employee intentionally engages in dishonest conduct in connection with
his performance of services for the Employer resulting in his conviction
of a felony; (ii) the employee is convicted of, or pleads guilty or nolo
contendere to, a felony or any crime involving moral turpitude; (iii) the
employee willfully fails or refuses to perform his duties under any
employment or retention agreement and fails to cure such breach within
sixty (60) days following written notice thereof from the Employer; (iv)
the employee breaches his fiduciary duties to the Employer for personal
profit; or (v) the employee's willful breach or violation of any law,
rule or regulation (other than traffic violations or similar offenses),
or final cease and desist order in connection with his performance of
services for the Employer;
(b) for an Eligible Employee who is an officer or employee of a
bank or savings institution regulated by the Office of Thrift
Supervision, "Termination for Cause" means termination of employment for
personal dishonesty, incompetence, willful misconduct, breach of
fiduciary duty involving personal profit, intentional failure to perform
stated duties, willful violation of any law, rule or regulation (other
than traffic violations or similar offenses) or final cease and desist
order, or any material breach of this Agreement, in each case as measured
against standards generally prevailing at the relevant time in the
savings and community banking industry; provided, however, that such
individual shall not be deemed to have been discharged for cause unless
and until he shall have received a written notice of termination from the
Board, which notice shall be given to such individual not later than five
(5) business days after the board of directors of the Employer adopts,
and shall be accompanied by, a resolution duly approved by affirmative
vote of a majority of the entire board of directors of the Employer at a
meeting called and held for such purpose (which meeting shall be held not
less than fifteen (15) days nor more than thirty (30) days after notice
to the individual), at which meeting there shall be a reasonable
opportunity for the individual to make oral and written presentations to
the members of the board of directors of the Employer, on his own behalf,
or through a representative, who may be his legal counsel, to refute the
grounds for the proposed determination) finding that in the good faith
opinion of the board of directors of the Employer grounds exist for
discharging the individual for cause.
ARTICLE III
AVAILABLE SHARES
Section 3.1 Available Shares.
Subject to section 8.3, the maximum aggregate number of Shares with
respect to which Options may be granted at any time shall be equal to the excess
of:
(a) 700,925 Shares; over
(b) the sum of:
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(i) the number of Shares with respect to which previously
granted Options may then or may in the future be exercised; plus
(ii) the number of Shares with respect to which previously
granted Options have been exercised.
A maximum aggregate of 490,647 Shares may be granted to Eligible Employees and a
maximum aggregate of 210,276 Shares may be granted to Eligible Directors. For
purposes of this section 3.1, an Option shall not be considered as having been
exercised to the extent that such Option terminates by reason other than the
purchase of related Shares; provided, however, that for purposes of meeting the
requirements of section 162(m) of the Code, no Eligible Employee who is a
covered employee under section 162(m) of the Code shall receive a grant of
Options in excess of the amount specified under this Section 3.1, computed as if
any Option which is cancelled reduced the maximum number of Shares.
ARTICLE IV
ADMINISTRATION
Section 4.1 Committee.
The Plan shall be administered by the members of the Compensation
Committee of Home Bancorp of Elgin, Inc. who are Disinterested Board Members. If
the Committee consists of fewer than two Disinterested Board Members, then the
Board shall appoint to the Committee such additional Disinterested Board Members
as shall be necessary to provide for a Committee consisting of at least two
Disinterested Board Members.
Section 4.2 Committee Action.
The Committee shall hold such meetings, and may make such administrative
rules and regulations, as it may deem proper. A majority of the members of the
Committee shall constitute a quorum, and the action of a majority of the members
of the Committee present at a meeting at which a quorum is present, as well as
actions taken pursuant to the unanimous written consent of all of the members of
the Committee without holding a meeting, shall be deemed to be actions of the
Committee. All actions of the Committee shall be final and conclusive and shall
be binding upon the Company and all other interested parties. Any Person dealing
with the Committee shall be fully protected in relying upon any written notice,
instruction, direction or other communication signed by the secretary of the
Committee and one member of the Committee, by two members of the Committee or by
a representative of the Committee authorized to sign the same in its behalf.
Section 4.3 Committee Responsibilities.
Subject to the terms and conditions of the Plan and such limitations as
may be imposed form time to time by the Board, the Committee shall be
responsible for the overall management and administration of the Plan and shall
have such authority as shall be necessary
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or appropriate in order to carry out its responsibilities, including, without
limitation, the authority:
(a) to interpret and construe the Plan, and to determine all
questions that may arise under the Plan as to eligibility for
participation in the Plan, the number of Shares subject to the Options,
if any, to be granted, and the terms and conditions thereof;
(b) to adopt rules and regulations and to prescribe forms for the
operation and administration of the Plan; and
(c) to take any other action not inconsistent with the provisions
of the Plan that it may deem necessary or appropriate.
ARTICLE V
STOCK OPTIONS FOR ELIGIBLE DIRECTORS
Section 5.1 In General.
(a) On the Effective Date, each Eligible Director shall be granted an
Option to purchase 35,046 Shares.
(b) Any Option granted under this section 5.1 shall be evidenced by a
written agreement which shall specify the number of Shares covered by the
Option, the Exercise Price for the Shares subject to the Option and the Option
Period, all as determined pursuant to this Article V. The Option agreement shall
also set forth specifically or incorporate by reference the applicable
provisions of the Plan.
Section 5.2 Exercise Price.
The price per Share at which an Option granted to an Eligible Director
under section 5.1 may be exercised shall be the Fair Market Value of a Share on
the date on which the Option is granted.
Section 5.3 Option Period.
(a) Subject to section 5.3(b), the Option Period during which an Option
granted to an Eligible Director under section 5.1 may be exercised shall
commence on the date the Option is granted and shall expire on the earlier of:
(i) removal for cause in accordance with the Employer's bylaws; or
(ii) the last day of the ten-year period commencing on the date on
which the Option was granted.
<PAGE>
-7-
(b) During the Option Period, the maximum number of Shares as to which an
outstanding Option may be exercised shall be as follows:
(i) prior to the first anniversary of the date on which the Plan
is approved by shareholders pursuant to section 9.8, the Option shall not
be exercisable;
(ii) on and after the first anniversary, but prior to the second
anniversary, of the date on which the Plan is approved by shareholders
pursuant to section 9.8, the Option may be exercised as to a maximum of
twenty percent (20%) of the Shares subject to the Option;
(iii) on and after the second anniversary, but prior to the third
anniversary, of the date on which the Plan is approved by shareholders
pursuant to section 9.8, the Option may be exercised as to a maximum of
forty percent (40%) of the Shares subject to the Option, when granted,
including in such number any optioned Shares purchased prior to such
second anniversary;
(iv) on and after the third anniversary, but prior to the fourth
anniversary, of the date on which the Plan is approved by shareholders
pursuant to section 9.8, the Option may be exercised as to a maximum of
sixty percent (60%) of the Shares subject to the Option, when granted,
including in such number any optioned Shares purchased prior to such
third anniversary;
(v) on and after the fourth anniversary, but prior to the fifth
anniversary, of the ate on which the Plan is approved by shareholders
pursuant to section 9.8, the Option may be exercised as to a maximum of
eighty percent (80%) of the Shares subject to the Option, when granted,
including in such number any optioned Shares purchased prior to such
fourth anniversary; and
(vi) on and after the fifth anniversary of the date on which the
Plan is approved by shareholders pursuant to section 9.8 and for the
remainder of the Option Period, the Option may be exercised as to the
entire number of optioned Shares not theretofore purchased;
provided, however, that such an Option shall become fully exercisable, and all
optioned Shares not previously purchased shall become available for purchase, on
the date of the Option holder's death, Disability or Retirement or upon the date
of a Change in Control.
<PAGE>
-9-
ARTICLE VI
STOCK OPTIONS FOR ELIGIBLE EMPLOYEES
Section 6.1 Size of Option.
Subject to sections 6.2 and 6.5 and such limitations as the Board may
from time to time impose, the number of Shares as to which an Eligible Employee
may be granted Options shall be determined by the Committee, in its discretion.
Except as provided in section 6.5, the maximum number of Shares that may be
optioned to any one individual under this Plan during its entire duration shall
be the entire number of Shares available under section 3.1 of the Plan.
Section 6.2 Grant of Options.
(a) Subject to the limitations of the Plan, the Committee may, in its
discretion grant to an Eligible Employee an Option to purchase Shares. The
Option for such Eligible Employees must be designated as either an Incentive
Stock Option or a Non-Qualified Stock Option and, if not designated as either,
shall be a Non-Qualified Stock Option.
(b) Any Option granted under this section 6.2 shall be evidenced by a
written agreement which shall:
(i) specify the number of Shares covered by the Option;
(ii) specify the Exercise Price, determined in accordance with
section 6.3, for the Shares subject to the Option;
(iii) specify the Option Period determined in accordance with
section 6.4;
(iv) set forth specifically or incorporate by reference the
applicable provisions of the Plan; and
(v) contain such other terms and conditions not inconsistent with
the Plan as the Committee may, in its discretion, prescribe with respect
to an Option granted to an Eligible Employee.
Section 6.3 Exercise Price.
The price per Share at which an Option granted to an Eligible Employee
shall be determined by the Committee, in its discretion; provided, however, that
the Exercise Price shall not be less than the Fair Market Value of a Share on
the date on which the Option is granted.
<PAGE>
-10-
Section 6.4 Option Period.
Subject to section 6.5, the Option Period during which an Option granted
to an Eligible Employee may be exercised shall commence on the date specified by
the Committee in the Option agreement and shall expire on the date specified in
the Option agreement or, if no date is specified, on the earliest of:
(a) the close of business on the last day of the three-month
period commencing on the date of the Eligible Employee's termination of
employment with the Employer, other than on account of death or
Disability, Retirement or a Termination for Cause;
(b) the close of business on the last day of the one-year period
commencing on the date of the Eligible Employee's termination of
employment due to death, Disability or Retirement;
(c) the date and time when the Eligible Employee ceases to be an
employee of the Employer due to a Termination for Cause; and
(d) the last day of the ten-year period commencing on the date on
which the Option is granted.
Section 6.5 Required Regulatory Provisions.
Notwithstanding anything contained herein to the contrary:
(a) no Option shall be granted to an Eligible Employee under the
Plan prior to the shareholder approval under section 9.8;
(b) no Eligible Employee may be granted Options to purchase more
than 175,236 Shares;
(c) each Option granted to an Eligible Employee shall become
exercisable as follows:
(i) prior to the first anniversary of the date on which the
Plan is approved by shareholders pursuant to section 9.8, the
Option shall be exercisable;
(ii) on and after the first anniversary, but prior to the
second anniversary, of the date on which the Plan is approved by
shareholders pursuant to section 9.8, the Option may be exercised
as to a maximum of twenty percent (20%) of the Shares subject to
the Option when granted;
(iii) on and after the second anniversary, but prior to the
third anniversary, of the date on which the Plan is approved by
shareholders pursuant to section 9.8, the Option may be exercised
as to a maximum of
<PAGE>
-11-
forty percent (40%) of the Shares subject to the Option when
granted, including in such forty percent (40%) any optioned Shares
purchased prior to such second anniversary;
(iv) on and after the third anniversary, but prior to the
fourth anniversary, of the date on which the Plan is approved by
shareholders pursuant to section 9.8, the Option may be exercised
as to a maximum of sixty percent (60%) of the Shares subject to
the Option when granted, including in such sixty percent (60%) any
optioned Shares purchased prior to such third anniversary;
(v) on and after the fourth anniversary, but prior to the
fifth anniversary, of the date on which the Plan is approved by
shareholders pursuant to section 9.8, the Option may be exercised
as to a maximum of eighty percent (80%) of the Shares subject to
the Option when granted, including in such eighty percent (80%)
any optioned Shares purchased prior to such fourth anniversary;
and
(vi) on and after the fifth anniversary of the date on
which the Plan is approved by shareholders pursuant to section 9.8
and for the remainder of the Option Period, the Option may be
exercised as to the entire number of optioned Shares not
theretofore purchased;
provided, however, that such an Option shall become fully exercisable,
and all optioned Shares not previously purchased shall become available
for purchase, on the date of the Option holder's death, Disability or
Retirement or upon a Change in Control; and provided, further, that the
Committee may establish a different vesting schedule in a particular case
or as a matter of policy.
(d) The Option Period of any Option granted to an Eligible
Employee hereunder, whether or not previously vested, shall be
suspended as of the time and date at which the Option holder has
received notice from the Board that his or her employment is
subject to a possible Termination for Cause. Such suspension shall
remain in effect until the Option holder receives official notice
from the Board that he or she has been cleared of any possible
Termination for Cause, at which time, the original Exercise Period
shall be reinstated without any adjustment for the intervening
suspended period. In the event that the Option Period under
section 6.4 expires during such suspension, the Company shall pay
to the Eligible Employee, within 30 days after his reinstatement
as an employee of the Company, damages equal to the value of the
expired Options less the Exercise Price of such Options.
(e) No Option granted to an Eligible Employee hereunder,
whether or not previously vested, shall be exercised after the
time and date at which the Option holder's employment with the
Employer is terminated in a Termination for Cause.
<PAGE>
-12-
Section 6.6 Additional Restrictions on Incentive Stock Options.
In addition to the limitations of section 7.2, an Option granted to an
Eligible Employee designated by the Committee to be an Incentive Stock Option
shall be subject to the following limitations:
(a) If, for any calendar year, the sum of (i) plus (ii) exceeds
$100,000, where (i) equals the Fair Market Value (determined as of the
date of the grant) of Shares subject to an Option intended to be an
Incentive Stock Option which first become available for purchase during
such calendar year, and (ii) equals the Fair Market Value (determined as
of the date of the grant) of Shares subject to any other options intended
to be Incentive Stock Options and previously granted to the same Eligible
Employee which first become exercisable in such calendar year, then that
number of Shares optioned which causes the sum of (i) and (ii) to exceed
$100,000 shall be deemed to be Shares optioned pursuant to a
Non-Qualified Stock Option or Non-Qualified Stock Options, with the same
terms as the Option or Options intended to be an Incentive Stock Option;
(b) The Exercise Price of an Incentive Stock Option granted to an
Eligible Employee who, at the time the Option is granted, owns Shares
comprising more than 10% of the total combined voting power of all
classes of stock of the Company shall not be less than 110% of the Fair
Market Value of a Share, and if an Option designated as an Incentive
Stock Option shall be granted at an Exercise Price that does not satisfy
this requirement, the designated Exercise Price shall be observed and the
Option shall be treated as a Non-Qualified Stock Option;
(c) The Option Period of an Incentive Stock Option granted to an
Eligible Employee who, at the time the Option is granted, owns Shares
comprising more than 10% of the total combined voting power of all
classes of stock of the Company, shall expire no later than the fifth
anniversary of the date on which the Option was granted, and if an Option
designated as an Incentive Stock Option shall be granted for an Option
Period that does not satisfy this requirement, the designated Option
Period shall be observed and the Option shall be treated as a
Non-Qualified Stock Option;
(d) An Incentive Stock Option that is exercised during its
designated Option Period but more than:
(i) three (3) months after the termination of employment
with the Company, a parent or a subsidiary (other than on account
of disability within the meaning of section 22(e)(3) of the Code
or death) of the Eligible Employee to whom it was granted; and
<PAGE>
-13-
(ii) one (1) year after such individual's termination of
employment with the Company, a parent or a subsidiary due to
disability (within the meaning of section 22(e)(3) of the Code);
may be exercised in accordance with the terms but shall at the time of
exercise be treated as a Non-Qualified Stock Option; and
(e) Except with the prior written approval of the Committee, no
individual shall dispose of Shares acquired pursuant to the exercise of
an Incentive Stock Option until after the later of (i) the second
anniversary of the date on which the Incentive Stock Option was granted,
or (ii) the first anniversary of the date on which the Shares were
acquired.
ARTICLE VII
OPTIONS - IN GENERAL
Section 7.1 Method of Exercise.
(a) Subject to the limitations of the Plan and the Option agreement, an
Option holder may, at any time during the Option Period, exercise his or her
right to purchase all or any part of the Shares to which the Option relates;
provided, however, that the minimum number of Shares which may be purchased at
any time shall be 100, or, if less, the total number of Shares relating to the
Option which remain unpurchased. An Option holder shall exercise an Option to
purchase Shares by:
(i) giving written notice to the Committee, in such form and
manner as the Committee may prescribe, of his intent to exercise the
Option;
(ii) delivering to the Committee full payment, consistent with
section 7.1(b), for the Shares as to which the Option is to be exercised;
and
(iii) satisfying such other conditions as may be prescribed in the
Option agreement.
(b) The Exercise Price of Shares to be purchased upon exercise of any
Option shall be paid in full in cash (by certified or bank check or such other
instrument as the Company may accept) or, if and to the extent permitted by the
Committee, by one or more of the following: (i) in the form of Shares already
owned by the Option holder having an aggregate Fair Market Value on the date the
Option is exercised equal to the aggregate Exercise Price to be paid; (ii) by
requesting the Company to cancel without payment Options outstanding to such
Person for that number of Shares whose aggregate Fair Market Value on the date
of exercise, when reduced by their aggregate Exercise Price, equals the
aggregate Exercise Price of the Options being exercised; or (iii) by a
combination thereof. Payment for any Shares to be purchased upon exercise of an
Option may also be made by delivering a properly executed exercise notice to the
Company, together with a copy of irrevocable instructions to a broker to deliver
promptly to the Company the amount of sale or loan
<PAGE>
-14-
proceeds to pay the purchase price. To facilitate the foregoing, the Company may
enter into agreements for coordinated procedures with one or more brokerage
firms.
(c) When the requirements of section 7.1(a) and (b) have been satisfied,
the Committee shall take such action as is necessary to cause the issuance of a
stock certificate evidencing the Option holder's ownership of such Shares. The
Person exercising the Option shall have no right to vote or to receive
dividends, nor have any other rights with respect to the Shares, prior to the
date as of which such Shares are transferred to such Person on the stock
transfer records of the Company, and no adjustments shall be made for any
dividends or other rights for which the record date is prior to the date as of
which such transfer is effected, except as may be required under section 8.3.
Section 7.2 Limitations on Options.
(a) An Option by its terms shall not be transferable by the Option holder
other than to Family Members or Non-profit Organizations or by will or by the
laws of descent and distribution and shall be exercisable, during the lifetime
of the Option holder, only by the Option holder, a Family Member or a Non-profit
Organization. Any such transfer shall be effected by written notice to the
Company given in such form and manner as the Committee may prescribe and shall
be recognized only if such notice is received by the Company prior to the death
of the person giving it. Thereafter, the transferee shall have, with respect to
such Option, all of the rights, privileges and obligations which would attach
thereunder to the transferor if the Option were issued to such transferor. If a
privilege of the Option depends on the life, employment or other status of the
transferor, such privilege of the Option for the transferee shall continue to
depend on the life, employment or other status of the transferor. The Committee
shall have full and exclusive authority to interpret and apply the provisions of
this Plan to transferees to the extent not specifically described herein.
Notwithstanding the foregoing, an Incentive Stock Option is not transferable by
an Eligible Employee other than by will or the laws of descent and distribution,
and is exercisable, during his lifetime, solely by him.
(b) The Company's obligation to deliver Shares with respect to an Option
shall, if the Committee so requests, be conditioned upon the receipt of a
representation as to the investment intention of the Option holder to whom such
Shares are to be delivered, in such form as the Committee shall determine to be
necessary or advisable to comply with the provisions of applicable federal,
state or local law. It may be provided that any such representation shall become
inoperative upon a registration of the Shares or upon the occurrence of any
other event eliminating the necessity of such representation. The Company shall
not be required to deliver any Shares under the Plan prior to (i) the admission
of such Shares to listing on any stock exchange on which Shares may then be
listed, or (ii) the completion of such registration or other qualification under
any state or federal law, rule or regulation as the Committee shall determine to
be necessary or advisable.
<PAGE>
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ARTICLE VIII
AMENDMENT AND TERMINATION
Section 8.1 Termination.
The Board may suspend or terminate the Plan in whole or in part at any
time prior to the tenth anniversary of the Effective Date by giving written
notice of such suspension or termination to the Committee. Unless sooner
terminated, the Plan shall terminate automatically on the day preceding the
tenth anniversary of the Effective Date. In the event of any suspension or
termination of the Plan, all Options theretofore granted under the Plan that are
outstanding on the date of such suspension or termination of the Plan shall
remain outstanding and exercisable for the period and on the terms and
conditions set forth in the Option agreements evidencing such Options.
Section 8.2 Amendment.
The Board may amend or revise the Plan in whole or in part at any time;
provided, however, that, to the extent required to comply with section 162(m) of
the Code, no such amendment or revision shall be effective if it amends a
material term of the Plan unless approved by the holders of a majority of the
voting Shares of Home Bancorp of Elgin, Inc.; and provided, further, that no
such amendment shall result in non-compliance with any applicable OTS
Regulation.
Section 8.3 Adjustment in the Event of a Business Reorganization.
(a) In the event of any merger, consolidation, or other business
reorganization in which the Company is the surviving entity, and in the event of
any stock split, stock dividend or other event generally affecting the number of
Shares held by each Person who is then a holder of record of Shares, the number
of Shares covered by each outstanding Option and the number of Shares available
pursuant to section 3.1 shall be adjusted to account for such event. Such
adjustment shall be effected by multiplying such number of Shares by an amount
equal to the number of Shares that would be owned after such event by a Person
who, immediately prior to such event, was the holder of record of one Share, and
the Exercise Price of the Options shall be adjusted by dividing the Exercise
Price by such number of Shares; provided, however, that the Committee may, in
its discretion, establish another appropriate method of adjustment.
(b) In the event of any merger, consolidation, or other business
reorganization in which the Company is not the surviving entity, any Options
granted under the Plan which remain outstanding, whether or not exercisable, may
be canceled as of the effective date of such merger, consolidation, business
reorganization, liquidation or sale by the Board upon 30 days' written notice to
the Option holder; provided, however, that on or as soon as practicable
following the date of cancellation, each Option holder shall receive a monetary
payment in such amount, or other property of such kind and value, as the Board
determines in good faith to be equivalent in value to the Options that have been
canceled.
<PAGE>
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(c) In the event that the Company shall declare and pay any dividend with
respect to Shares (other than a dividend payable in Shares) which results in a
nontaxable return of capital to the holders of Shares for federal income tax
purposes or otherwise than by dividend makes distribution of property to the
holders of its Shares, the Company shall, in the discretion of the Committee,
either:
(i) make an equivalent payment to each Person holding an
outstanding Option as of the record date for such dividend. Such payment
shall be made at substantially the same time, in substantially the same
form and in substantially the same amount per optioned Share as the
dividend or other distribution paid with respect to outstanding Shares;
provided, however, that if any dividend or distribution on outstanding
Shares is paid in property other than cash, the Company, in the
Committee's discretion, may make such payment in a cash amount per
optioned Share equal in fair market value to the fair market value of the
non-cash dividend or distribution; or
(ii) adjust the Exercise Price of each outstanding Option in such
manner as the Committee may determine to be appropriate to equitably
reflect the payment of the dividend; or
(iii) take the action described in section 8.3(c)(i) with respect
to certain outstanding Options and the action described in section
8.3(c)(ii) with respect to the remaining outstanding Options;
provided, however, that no such action shall be taken without the approval of
the Office of Thrift Supervision until the stockholders of the Company have
voted to approve the provisions of this section 8.3(c) by a majority of the
votes cast in a vote taken after September 26, 1997.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Status as an Employee Benefit Plan.
This Plan is not intended to satisfy the requirements for qualification
under section 401(a) of the Code or to satisfy the definitional requirements for
an "employee benefit plan" under section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended. It is intended to be a non-qualified incentive
compensation program that is exempt from the regulatory requirements of the
Employee Retirement Income Security Act of 1974, as amended. The Plan shall be
construed and administered so as to effectuate this intent.
Section 9.2 No Right to Continued Employment.
Neither the establishment of the Plan nor any provisions of the Plan nor
any action of the Board or the Committee with respect to the Plan shall be held
or construed to confer upon any Eligible Director or Eligible Employee any right
to a continuation of his or her position as a director or employee of the
Company. The Employers reserve the right to
<PAGE>
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remove any Eligible Director or dismiss any Eligible Employee or otherwise deal
with any Eligible Director or Eligible Employee to the same extent as though the
Plan had not been adopted.
Section 9.3 Construction of Language.
Whenever appropriate in the Plan, words used in the singular may be read
in the plural, words used in the plural may be read in the singular, and words
importing the masculine gender may be read as referring equally to the feminine
or the neuter. Any reference to an Article or section number shall refer to an
Article or section of this Plan unless otherwise indicated.
Section 9.4 Governing Law.
The Plan shall be construed, administered and enforced according the laws
of the State of Illinois without giving effect to the conflict of laws
principles thereof, except to the extent that such laws are preempted by federal
law. The Plan shall be construed to comply with applicable OTS Regulations.
Section 9.5 Headings.
The headings of Articles and sections are included solely for convenience
of reference. If there is any conflict between such headings and the text of the
Plan, the text shall control.
Section 9.6 Non-Alienation of Benefits.
The right to receive a benefit under the Plan shall not be subject in any
manner to anticipation, alienation or assignment, nor shall such right be liable
for or subject to debts, contracts, liabilities, engagements or torts, except to
the extent provided in a qualified domestic relations order as defined in
section 414(p) of the Code.
Section 9.7 Taxes.
The Company shall have the right to deduct from all amounts paid by the
Company in cash with respect to an Option under the Plan any taxes required by
law to be withheld with respect to such Option. Where any Person is entitled to
receive Shares pursuant to the exercise of an Option, the Company shall have the
right to require such Person to pay the Company the amount of any tax which the
Company is required to withhold with respect to such Shares, or, in lieu
thereof, to retain, or to sell without notice, a sufficient number of Shares to
cover the amount required to be withheld.
Section 9.8 Approval of Shareholders.
The Plan shall not be effective or implemented unless approved by
shareholders of Home Bancorp of Elgin, Inc. as follows:
<PAGE>
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(a) if, prior to the one year anniversary of the stock conversion
of Home Federal Savings and Loan Association of Elgin to stock form, the
Plan is, approved by the holders of a majority of the total votes
eligible to be cast at any duly called annual or special meeting of the
Company, the Plan shall be effective as of the date of such approval; and
(b) if subsequent to the one year anniversary of such conversion,
the Plan is approved by the affirmative vote of the holders of a majority
of Shares present or represented by proxy at the meeting and entitled to
vote at an annual or special meeting at which a quorum is present, the
Plan shall be effective as of the date of such approval.
Shareholder approval shall not be obtained at an annual or special meeting
earlier than six months following such conversion unless permitted by the Office
of Thrift Supervision. No Option shall be granted prior to shareholder approval
of the Plan.
Section 9.9 Notices.
Any communication required or permitted to be given under the Plan,
including any notice, direction, designation, comment, instruction, objection or
waiver, shall be in writing and shall be deemed to have been given at such time
as it is delivered personally or five (5) days after mailing if mailed, postage
prepaid, by registered or certified mail, return receipt requested, addressed to
such party at the address listed below, or at such other address as one such
party may by written notice specified to the other party:
(a) If to the Committee:
Home Bancorp of Elgin, Inc.
16 North Spring Street
Elgin, Illinois 60010
Attention: Corporate Secretary
(b) If to an Option holder, to the Option holder's address as
shown in the Employer's records.
Exhibit 4.2
OFFICERS AND EMPLOYEES
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
STOCK OPTION AGREEMENT
- -
- ------------------------------------ --------- ------- -----------
Name of Option Recipient Social Security Number
- --------------------------------------------------------------------------------
Street Address
- -------------------------- --------------------------- -------------------
City State ZIP Code
This Stock Option Agreement is intended to set forth the terms and conditions on
which a Stock Option has been granted under the Home Bancorp of Elgin, Inc. 1997
Stock Option Plan. Set forth below are the specific terms and conditions
applicable to this Stock Option. Attached as Exhibit A are its general terms and
conditions.
<TABLE>
<CAPTION>
=============================== ================== ================== =================== ================== ==================
Option Grant (A) (B) (C) (D) (E)
=============================== ================== ================== =================== ================== ==================
<S> <C> <C> <C> <C> <C>
Grant Date:
- ------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Class of Optioned Shares* Common Common Common Common Common
- ------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
No. of Optioned Shares*
- ------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Exercise Price Per Share*
- ------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Option Type (ISO or NQSO)
- ------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Vesting
- ------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Earliest Exercise Date*
- ------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Option Expiration Date*
=============================== ================== ================== =================== ================== ==================
*Subject to adjustment as provided in the Plan and the General Terms and Conditions.
</TABLE>
By signing where indicated below, Home Bancorp of Elgin, Inc. (the "Company")
grants this Stock Option with respect to the shares of its common stock, par
value $0.01 per share ("Common Stock"), identified above, upon the specified
terms and conditions, and the Option Recipient acknowledges receipt of this
Stock Option Agreement, including Exhibit A, and agrees to observe and be bound
by the terms and conditions set forth herein.
HOME BANCORP OF ELGIN, INC. OPTION RECIPIENT
By ___________________________ __________________________
Name: Name of Recipient
Title:
- --------------------------------------------------------------------------------
Instructions: This page should be completed by or on behalf of the Compensation
Committee. Any blank space intentionally left blank should be crossed out. An
option grant consists of a number of optioned shares with uniform terms and
conditions. Where options are granted on the same date with varying terms and
conditions (for example, varying exercise prices or earliest exercise dates),
the options should be recorded as a series of grants each with its own uniform
terms and conditions.
<PAGE>
EXHIBIT A - OFFICERS AND EMPLOYEES
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
STOCK OPTION AGREEMENT
General Terms and Conditions
Section 1. Incentive Stock Option. If the Option is designated as an ISO,
the Company intends the Option evidenced hereby to be an "incentive stock
option" within the meaning of section 422 of the internal Revenue Code of 1986
("Code). If the Option or any part of the Option does not qualify as an
"incentive stock option" under the Plan or the Code, the Option or the part not
qualifying shall be treated as a Non-Qualified Stock Option under the Code.
Section 2. Option Period. a. You shall have the right to purchase all or
any portion of the optioned Common Stock at any time during the period ("Option
Period") commencing on the Earliest Exercise Date and ending on the earliest to
occur of the following dates:
(i) the close of business on the last day of the 3-month period
commencing on the date of the termination of all employment with the
Company and the Home Federal Savings and Loan Association of Elgin;
provided, however, that if such termination is on account of death,
disability or retirement, such date shall be the last day of the 1-year
period commencing on such termination;
(ii) the date of Termination for Cause; or
(iii) the Option Expiration Date.
(b) If the Option is designated as an ISO, the favorable tax treatment
applicable to incentive stock options may not apply if it is exercisable more
than three months after your termination of employment for reasons other than
total and permanent disability (within this meaning of section 22(e)(3) of the
Code) or more than one year after your termination of employment due to total
and permanent disability.
(c) Upon the termination of your service with the Company, any Option
granted hereunder whose Earliest Exercise Date has not occurred is deemed
forfeited. In the event your termination results from your death or disability
(as defined in the Plan), the date of your termination shall be the Earliest
Exercise Date for any options that are not already exercisable. To the extent
authorized pursuant to a Plan provision that is approved by the Company's
shareholders after September 26, 1997, in the event of your retirement (as
defined in the Plan) or a change in control (as defined in the Plan), the date
of such retirement or change in control shall be the Earliest Exercise Date of
any Options that are not already exercisable.
Section 3. Exercise Price. During the Option Period, and after the
applicable Earliest Exercise Date, you shall have the right to purchase all or
any portion of the optioned Common Stock at the Exercise Price per share.
<PAGE>
Section 4. Method of Exercise. You may, at any time during the Option
Period provided by section 2, exercise your right to purchase all or any part of
the optioned Common Stock then available for purchase; provided, however, that
the minimum number of shares of optioned Common Stock which may be purchased
shall be one hundred (100) or, if less, the total number of shares of optioned
Common Stock then available for purchase. Your may exercise such right by:
(a) giving written notice to the Committee, in the form attached hereto
as Appendix A; and
(b) delivering to the Committee full payment of the Exercise Price for
the optioned Common Stock to be purchased.
The date of exercise shall be the earliest date practicable following the date
the requirements of this section 4 have been satisfied, but in no event more
than three (3) days after such date. Payment shall be made (i) in United States
dollars by certified check, money order or bank draft made payable to the order
of Home Bancorp of Elgin, Inc., (ii) in shares of Common Stock duly endorsed for
transfer and with all necessary stock transfer tax stamps attached, already
owned by you and having a fair market value equal to the Exercise Price, such
fair market value to be determined in such manner as may be provided by the
Committee or as may be required in order to comply with or conform to the
requirements of any applicable laws or regulations, or (iii) in a combination of
(i) and (ii). If this Option is designated as an ISO, you shall not, without the
prior written approval of the Committee, dispose of shares of Common Stock
acquired pursuant to the exercise of an "Incentive Stock Option" until after the
later of (i) the second anniversary of the date on which the Incentive Stock
Option was granted, or (ii) the first anniversary of the date on which the
Incentive Stock Option was exercisable.
Section 5. Delivery and Registration of Optioned Shares. As soon as is
practicable following the date on which you have satisfied the requirements of
section 4, the Committee shall take such action as is necessary to cause the
Company to issue a stock certificate evidencing your ownership of the optioned
Common Stock that has been purchased. You shall have no right to vote or to
receive dividends, nor have any other rights with respect to optioned Common
Stock, prior to the date as of which said such optioned Common Stock is
transferred to you on the stock transfer records of the Company, and no
adjustments shall be made for any dividends or other rights for which the record
date is prior to the date as of which such transfer is effected. The obligation
of the Company to deliver Common Stock under this Agreement shall, if the
Committee so requests, be conditioned upon the receipt of a representation as to
the investment intention of the person to whom such Common Stock is to be
delivered, in such form as the Committee shall determine to be necessary or
advisable to comply with the provisions of applicable federal, state or local
law. It may be provided that any such representation shall become inoperative
upon a registration of the Common Stock or upon the occurrence of any other
event eliminating the necessity of such representation. The Company shall not be
required to deliver any Common Stock under this Agreement prior to (a) the
admission of such Common Stock to listing on any stock exchange on which Common
Stock may then be listed, or (b) the completion of such registration or other
qualification under any state of federal law, rule or regulations as the
Committee shall determine to be necessary or advisable.
Section 6. Adjustments in the Event of Reorganization. In the event of
any merger, consolidation, or other business reorganization in which the Company
is the surviving entity, and in the event of any stock split, stock dividend or
other event generally affecting the number of shares of Common Stock held by
each person who is then an shareholder of record, the number of shares of Common
Stock subject to the option granted hereunder and the Exercise Price
<PAGE>
per share of such option shall be adjusted in accordance with section 8.3 of the
Plan to account for such event. In the event of any merger, consolidation, or
other business reorganization in which the Company is not the surviving entity,
any exercisable option granted hereunder shall be cancelled or adjusted in
accordance with the Plan. In the event that the Company shall declare and pay
any dividend with respect to shares of Common Stock (other than a dividend
payable in shares of Common Stock) which results in a nontaxable return of
capital to the holders of shares of Common Stock for federal income tax
purposes, or otherwise than by dividend makes distribution of property to the
holders of its shares of Common Stock, at the election of the Committee, the
Company shall either (i) make an equivalent payment to each Person holding an
outstanding Option as of the record date for such dividend or distribution in
accordance with section 8.3 of the plan or (ii) adjust the Exercise Price per
share of outstanding Options in such a manner as the Committee may determine to
be necessary to reflect the effect of the dividend or distribution, or (iii)
take any other action described in section 8.3(c) of the Plan. Actions taken
under section 8.3(c) of the Plan is obtained by the stockholders of the Company
after September 26, 1997.
Section 7. No Right to Continued Service. Nothing in this Agreement nor
any action of the Board or Committee with respect to the Agreement shall be held
or construed to confer upon you any right to a continuation of service by the
Company or the Home Federal Savings and Loan Association of Elgin. You may be
dismissed or otherwise dealt with as though this Agreement had not been entered
into.
Section 8. Taxes. Where any person is entitled to receive shares pursuant
to the exercise of the Option granted hereunder, the Company shall have the
right to require such person to pay to the Company the amount of any tax which
the Company is required to withhold with respect to such shares, or, in lieu
thereof, to retain, or to sell without notice, a sufficient number of shares to
cover the amount required to be withheld.
Section 9. Notices. Any communication required or permitted to be given
under the Plan, including any notice, direction, designation, comment,
instruction, objection or waiver, shall be in writing and shall be deemed to
have been given at such time as it is delivered personally or five (5) days
after mailing if mailed, postage prepaid, by registered or certified mail,
return receipt requested, addressed to such party at the address listed below,
or at such other address as one such party may by written notice specify to the
other party:
(a) If to the Committee:
Home Bancorp of Elgin, Inc.
c/o Home Federal Savings and Loan Association of Elgin
16 North Spring Street
Elgin, Illinois 60120
Attention: Corporate Secretary
(b) If to you, to your address as shown in the Company's personnel
records.
Section 10. Restrictions on Transfer. The option granted hereunder shall
not be subject in any manner to anticipation, alienation or assignment, nor
shall such option be liable for or subject to debts, contracts, liabilities,
engagements or torts, nor shall it be transferable by you other than by will or
by the laws of descent and distribution or as otherwise permitted by the Plan.
To name a Beneficiary who may exercise your options following your death,
complete the attached Appendix B and file it with the Corporate Secretary of
Home Bancorp of Elgin, Inc.
<PAGE>
Section 11. Successors and Assigns. This Agreement shall inure to the
benefit of and shall be binding upon the Company and you and your respective
heirs, successors and assigns.
Section 12. Construction of Language. Whenever appropriate in the
Agreement, words used in the singular may be read in the plural, words used in
the plural may be read in the singular, and words importing the masculine gender
may be read as referring equally to the feminine or the neuter. Any reference to
a section shall be a reference to a section of this Agreement, unless the
context clearly indicates otherwise. Capitalized terms not specifically defined
herein shall have the meanings assigned to them under the Plan.
Section 13. Governing Law. This Agreement shall be construed,
administered and enforced according to the laws of the State of Illinois without
giving effect to the conflict of laws principles thereof, except to the extent
that such laws are preempted by the federal law.
Section 14. Amendment. This Agreement may be amended, in whole or in part
and in any manner not inconsistent with the provisions of the Plan, at any time
and from time to time, by written agreement between the Company and you.
Section 15. Plan Provisions Control. This Agreement and the rights and
obligations created hereunder shall be subject to all of the terms and
conditions of the Plan. In the event of any conflict between the provisions of
the Plan and the provisions of this Agreement, the terms of the Plan, which are
incorporated herein by reference, shall control. By signing this Agreement, you
acknowledge receipt of a copy of the Plan.
<PAGE>
APPENDIX A TO STOCK OPTION AGREEMENT
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
Notice of Exercise of Stock Option
- --------------------------------------------------------------------------------
Use this notice to inform the Committee administering the Home Bancorp of Elgin,
Inc. 1997 Stock Option Plan ("Plan") that you are exercising your right to
purchase shares of common stock ("Shares") of Home Bancorp of Elgin, Inc. (the
"Company") pursuant to an option ("Option") granted under the Plan. If you are
not the person to whom the Option was granted ("Option Recipient") you must
attach to this notice proof of your right to exercise the Option granted under
the Stock Option Agreement entered into between the Company and the Option
Recipient ("Agreement"). This Notice should be personally delivered or mailed by
certified mail, return receipt requested to: Home Bancorp of Elgin, Inc., c/o
Home Federal Savings and Loan Association of Elgin, 16 North Spring Street,
Elgin, Illinois 60120 Attention: Corporate Secretary. The effective date of the
exercise of the Option shall be the earliest date practicable following the date
this Notice is received by the Company, but in no event more than three days
after such date ("Effective Date"). Except as specifically provided to the
contrary herein, capitalized terms shall have the meanings assigned to them
under the Plan. This Notice is subject to all of the terms and conditions of the
Plan and the Agreement.
OPTION INFORMATION Identify below the Option that you are exercising by
providing the following information from the Stock Option Agreement.
Name of Option Recipient:
--------------------------------------------------
Option Grant Date: ,
---------------------------- ----------------
(Month and Day) (Year)
Exercise Price per share: $ _______.___
EXERCISE PRICE Compute the Exercise Price below and select a method of payment.
Total Exercise Price x $ . =
------------------- --------- ----
(No. of Shares) Exercise Price
---------------------
Total Exercise Price
Method of Payment
|_| I enclose a certified check, money order,
or bank draft payable to the order of
Home Bancorp of Elgin, Inc. in the amount of $
----------------
|_| I enclose Shares duly endorsed for transfer
to the Company with all stamps attached and $
having a fair market value of ----------------
Total Exercise Price $
----------------
ISSUANCE OF CERTIFICATES
I hereby direct that the stock certificates representing the Shares
purchased pursuant to section 2 above be issued to the following
person(s) in the amount specified below:
Name and Address Social Security No. No of Shares
- ------------------------------- - -
----- ----- ----- ------------
- -------------------------------
- ------------------------------- - -
----- ----- ----- ------------
- -------------------------------
<PAGE>
WITHHOLDING ELECTIONS For Employee Option Recipients with Non-Qualified Stock
Options only. Beneficiaries and Outside Directors should not complete.
I understand that I am responsible for the amount of federal, state and
local taxes required to be withheld with respect to the Shares to be
issued to me pursuant to this Notice, but that I may request the Company
to retain or sell a sufficient number of such Shares to cover the amount
to be withheld. I hereby request that any taxes required to be withheld
be paid in the following manner [check one]:
|_| With a certified or bank check that I will deliver to the
Committee on the day after the Effective Date of my exercise.
|_| With the proceeds from a sale of Shares that would otherwise be
distributed to me.
|_| Retain shares that would otherwise be distributed to me.
I understand that the withholding elections I have made on this form are
not binding on the Committee, and that the Committee will decide the
amount to be withheld and the method of withholding and advise me of its
decision prior to the Effective Date. I further understand that the
Committee may request additional information or assurances regarding the
manner and time at which I will report the income attributable to the
distribution to be made to me.
COMPLIANCE WITH TAX AND SECURITIES LAWS
I understand that must rely on, and consult with, my own tax and legal
S H counsel (and not the Company) regarding the application of all laws -
particularly tax and securities laws - to the transactions to be effected
I E pursuant to my Option and this Notice. I understand that I will be
responsible for paying any federal, state and local taxes that may become
G R due upon the sale (including a sale pursuant to a "cashless exercise") or
other disposition of Shares issued pursuant to this Notice and that I
N E must consult with my own tax advisor regarding how and when such income
will be reportable. I further understand that if I have elected to have
Shares sold to satisfy tax withholding I may be asked to pay a minimal
amount of such taxes in cash in order to avoid the sale of more Shares
than are necessary.
---------------------------------------------------- ----------------
Signature Date
---------------------------------------------------------------------------
Address
- --------------------------------------------------------------------------------
Internal Use Only
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Corporate Secretary Received [check one] |_| By Hand
|_| By Mail Post Marked
-----------------------------
Date of Post Mark
By
--------------------------------------------- -----------------------------
Authorized Signature Date of Receipt
- --------------------------------------------------------------------------------
<PAGE>
APPENDIX B TO STOCK OPTION AGREEMENT
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
Beneficiary Designation Form
- --------------------------------------------------------------------------------
General
Information Use this form to designate the Beneficiary(ies) who may exercise
Options outstanding to you at the time of your death.
Name of Person
Making Designation Social Security Number - -
-------------- ----- ---- -----
BENEFICIARY Complete sections A and B. If no percentage shares are specified,
DESIGNATION each Beneficiary in the same class (primary or contingent) shall
have an equal share. If any designated Beneficiary predeceases
you, the shares of each remaining Beneficiary in the same class
(primary or contingent) shall be increased proportionately
A Primary Beneficiary(ies). I hereby designate the following person as my
primary Beneficiary under the Plan, reserving the right to change or revoke this
designation at any time prior to my death:
Name Address Relationship Birthdate Share
%
- ----------------- ------------------ --------- ------- --------
------------------
%
- ----------------- --------- ------- --------
------------------
------------------
%
- ----------------- --------- ------- --------
------------------
Total = 100%
------------------
B Contingent Beneficiary(ies). I hereby designate the following person(s) as my
contingent Beneficiary(ies) under the Plan to receive benefits only if all of my
primary Beneficiaries should predecease me, reserving the right to change or
revoke this designation at any time prior to my death as to all outstanding
Options:
Name Address Relationship Birthdate Share
%
- ----------------- ------------------ --------- ------- --------
------------------
%
- ----------------- --------- ------- --------
------------------
------------------
%
- ----------------- --------- ------- --------
------------------
------------------
<PAGE>
S H I understand that this Beneficiary Designation shall be effective only if
properly completed and received by the Corporate Secretary of Home
I E Bancorp of Elgin, Inc. prior to my death, and that it is subject to all
of the terms and conditions of the Plan. I also understand that an
G R effective Beneficiary designation revokes my prior designations) with
respect to all outstanding Options.
N E
--------------------------------------------- -------------------
Your Signature Date
- --------------------------------------------------------------------------------
Internal Use Only
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
This Beneficiary Designation was received Comments
by the Corporate Secretary of Home Bancorp
of Elgin, Inc. on the date indicated.
By
--------------------------------------- ------------------
Authorized Signature Date
- --------------------------------------------------------------------------------
Exhibit 4.3
OUTSIDE DIRECTORS
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
- -
- ------------------------------------------- ------- ------- -------
Name of Option Recipient Social Security Number
- --------------------------------------------------------------------------------
Street Address
- ----------------------------- ------------------------- ------------------
City State ZIP Code
This Non-Qualified Stock Option Agreement is intended to set forth the terms and
conditions on which a Non-Qualified Stock Option has been granted under the Home
Bancorp of Elgin, Inc. 1997 Stock Option Plan. Set forth below are the specific
terms and conditions applicable to this Non-Qualified Stock Option. Attached as
Exhibit A are its general terms and conditions.
<TABLE>
<CAPTION>
================================ ================== ================== =================== ================== ==================
<S> <C> <C> <C> <C> <C>
Option Grant (A) (B) (C) (D) (E)
================================ ================== ================== =================== ================== ==================
Grant Date:
- -------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Class of Optioned Shares* Common Common Common Common Common
- -------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
No. of Optioned Shares*
- -------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Exercise Price Per Share*
- -------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Vesting
- -------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Earliest Exercise Date*
- -------------------------------- ------------------ ------------------ ------------------- ------------------ ------------------
Option Expiration Date*
================================ ================== ================== =================== ================== ==================
*Subject to adjustment as provided in the Plan and the General Terms and Conditions.
</TABLE>
By signing where indicated below, Home Bancorp of Elgin, Inc. (the "Company")
grants this Stock Option with respect to the shares of its common stock, par
value $0.01 per share ("Common Stock"), identified above, upon the specified
terms and conditions, and the Option Recipient acknowledges receipt of this
Non-Qualified Stock Option Agreement, including Exhibit A, and agrees to observe
and be bound by the terms and conditions set forth herein.
HOME BANCORP OF ELGIN, INC. OPTION RECIPIENT
By ___________________________________ __________________________
Name: Name of Recipient
Title:
- --------------------------------------------------------------------------------
Instructions: This page should be completed by or on behalf of the Compensation
Committee. Any blank space intentionally left blank should be crossed out. An
option grant consists of a number of optioned shares with uniform terms and
conditions. Where options are granted on the same date with varying terms and
conditions (for example, varying exercise prices or earliest exercise dates),
the options should be recorded as a series of grants each with its own uniform
terms and conditions.
<PAGE>
EXHIBIT A - OUTSIDE DIRECTORS
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
General Terms and Conditions
Section 1. Incentive Stock Option. The Company does not intend the Option
evidenced hereby to be an "incentive stock option" within the meaning of section
422 of the Internal Revenue Code of 1986 ("Code"). This Option shall be treated
for all purposes as a Non-Qualified Stock Option under the Code.
Section 2. Option Period. (a) You shall have the right to purchase all or
any portion of the optioned Common Stock at any time during the period ("Option
Period") commencing on the Earliest Exercise Date and ending on the earlier to
occur of the following dates:
(i) the date of your "removal for cause" determined in accordance
with the Company's By-Laws; or
(ii) the last day of the ten-year period commending on the date on
which the Option was granted.
(b) Upon the termination of your service with the Company, any Option
granted hereunder whose Earliest Exercise Date has not occurred is deemed
forfeited. In the event your termination of service results from death or
disability (as defined in the Plan), the date of termination will be the
Earliest Exercise Date for any Option that is not already exercisable. To the
extent authorized pursuant to a Plan provision that is approved by the Company's
shareholders after September 26, 1997, in the event of your retirement (as
defined in the Plan) or a change in control (as defined in the Plan), the date
of your retirement or the change in control shall be the Earliest Exercise Date
for any Options that are not already exercisable.
Section 3. Exercise Price. During the Option Period, you shall have the
right to purchase all or any portion of the optioned Common Stock at the
Exercise Price per share.
Section 4. Method of Exercise. You may, at any time during the Option
Period provided by section 2, exercise your right to purchase all or any part of
the optioned Common Stock then available for purchase; provided, however, that
the minimum number of shares of optioned Common Stock which may be purchased
shall be one hundred (100) or, if less, the total number of shares of optioned
Common Stock then available for purchase. Your may exercise such right by:
(a) giving written notice to the Committee, in the form attached hereto
as Appendix A; and
(b) delivering to the Committee full payment of the Exercise Price for
the optioned Common Stock to be purchased.
The date of exercise shall be the earliest date practicable following the date
the requirements of this section 4 have been satisfied, but in no event more
than three (3) days after such date. Payment shall be made (i) in United States
dollars by certified check, money order or bank draft made payable to the order
of Home Bancorp of Elgin, Inc., (ii) in shares of Common Stock duly endorsed for
transfer and with all necessary stock transfer tax stamps attached, already
owned by you and having a fair market value equal to the Exercise Price, such
fair market value to be determined in such manner as may be provided by the
Committee or as may be required in order to comply with or conform to the
requirements of any applicable laws or
<PAGE>
regulations, or (iii) in a combination of (i) and (ii).
Section 5. Delivery and Registration of Optioned Shares. As soon as is
practicable following the date on which you have satisfied the requirements of
section 4, the Committee shall take such action as is necessary to cause the
Company to issue a stock certificate evidencing your ownership of the optioned
Common Stock that has been purchased. You shall have no right to vote or to
receive dividends, nor any other rights with respect to optioned Common Stock,
prior to the date as of which said such optioned Common Stock is transferred to
you on the stock transfer records of the Company, and no adjustments shall be
made for any dividends or other rights for which the record date is prior to the
date as of which such transfer is effected. The obligation of the Company to
deliver Common Stock under this Agreement shall, if the Committee so requests,
be conditioned upon the receipt of a representation as to the investment
intention of the person to whom such Common Stock is to be delivered, in such
form as the Committee shall determine to be necessary or advisable to comply
with the provisions of applicable federal, state or local law. It may be
provided that any such representation shall become inoperative upon a
registration of the Common Stock or upon the occurrence of any other event
eliminating the necessity of such representation. The Company shall not be
required to deliver any Common Stock under this Agreement prior to (a) the
admission of such Common Stock to listing on any stock exchange on which Common
Stock may then be listed, or (b) the completion of such registration or other
qualification under any state of federal law, rule or regulations as the
Committee shall determine to be necessary or advisable.
Section 6. Adjustments in the Event of Reorganization. In the event of
any merger, consolidation, or other business reorganization in which the Company
is the surviving entity, and in the event of any stock split, stock dividend or
other event generally affecting the number of shares of Common Stock held by
each person who is then an shareholder of record, the number of shares of Common
Stock subject to the option granted hereunder and the Exercise Price per share
of such option shall be adjusted in accordance with section 8.3 of the Plan to
account for such event. In the event of any merger, consolidation, or other
business reorganization in which the Company is not the surviving entity, any
exercisable option granted hereunder shall be cancelled or adjusted in
accordance with the Plan. In the event that the Company shall declare and pay
any dividend with respect to shares of Common Stock (other than a dividend
payable in shares of Common Stock) which results in a nontaxable return of
capital to the holders of shares of Common Stock for federal income tax
purposes, or otherwise than by dividend makes distribution of property to the
holders of its shares of Common Stock, at the election of the Committee, the
Company shall either (i) make an equivalent payment to each Person holding an
outstanding Option as of the record date for such dividend or distribution in
accordance with section 8.3 of the plan or (ii) adjust the Exercise Price per
share of outstanding Options in such a manner as the Committee may determine to
be necessary to reflect the effect of the dividend or distribution, or (iii)
take any other action described in section 8.3(c) of the plan. Actions taken
under section 8.3(c) of the Plan is obtained by the stockholders of the Company
after September 26, 1997.
Section 7. No Right to Continued Service. Nothing in this Agreement nor
any action of the Board or Committee with respect to the Agreement shall be held
or construed to confer upon you any right to a continuation of service by the
Company or the Home Federal Savings and Loan Association of Elgin. You may be
dismissed or otherwise dealt with as though this Agreement had not been entered
into.
Section 8. Taxes. Where any person is entitled to receive shares pursuant
to the exercise of the Option granted hereunder, the Company shall have the
right to require such person to pay to the Company the amount of any tax which
the Company is required to withhold with respect to such shares, or, in lieu
thereof, to retain, or to sell without notice, a sufficient number of shares to
cover the amount required to be withheld.
Section 9. Notices. Any communication required or permitted to be given
under the Plan, including any notice, direction, designation, comment,
instruction, objection or waiver, shall be in writing and shall be deemed to
have been given at such time as it is delivered personally or five (5) days
after
<PAGE>
mailing if mailed, postage prepaid, by registered or certified mail, return
receipt requested, addressed to such party at the address listed below, or at
such other address as one such party may by written notice specify to the other
party:
(a) If to the Committee:
Home Bancorp of Elgin, Inc.
c/o Home Federal Savings and Loan Association of Elgin
16 North Spring Street
Elgin, Illinois 60120
Attention: Corporate Secretary
(b) If to you, to your address as shown in the Company's personnel
records.
Section 10. Restrictions on Transfer. The option granted hereunder shall
not be subject in any manner to anticipation, alienation or assignment, nor
shall such option be liable for or subject to debts, contracts, liabilities,
engagements or torts, nor shall it be transferable by you other than by will or
by the laws of descent and distribution or as otherwise permitted by the Plan.
To name a Beneficiary who may exercise your options following your death,
complete the attached Appendix B and file it with the Corporate Secretary of
Home Bancorp of Elgin, Inc.
Section 11. Successors and Assigns. This Agreement shall inure to the
benefit of and shall be binding upon the Company and you and your respective
heirs, successors and assigns.
Section 12. Construction of Language. Whenever appropriate in the
Agreement, words used in the singular may be read in the plural, words used in
the plural may be read in the singular, and words importing the masculine gender
may be read as referring equally to the feminine or the neuter. Any reference to
a section shall be a reference to a section of this Agreement, unless the
context clearly indicates otherwise. Capitalized terms not specifically defined
herein shall have the meanings assigned to them under the Plan.
Section 13. Governing Law. This Agreement shall be construed,
administered and enforced according to the laws of the State of Illinois without
giving effect to the conflict of laws principles thereof, except to the extent
that such laws are preempted by the federal law.
Section 14. Amendment. This Agreement may be amended, in whole or in part
and in any manner not inconsistent with the provisions of the Plan, at any time
and from time to time, by written agreement between the Company and you.
Section 15. Plan Provisions Control. This Agreement and the rights and
obligations created hereunder shall be subject to all of the terms and
conditions of the Plan. In the event of any conflict between the provisions of
the Plan and the provisions of this Agreement, the terms of the Plan, which are
incorporated herein by reference, shall control. By signing this Agreement, you
acknowledge receipt of a copy of the Plan.
<PAGE>
APPENDIX A TO STOCK OPTION AGREEMENT
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
Notice of Exercise of Stock Option
- --------------------------------------------------------------------------------
Use this notice to inform the Committee administering the Home Bancorp of Elgin,
Inc. 1997 Stock Option Plan ("Plan") that you are exercising your right to
purchase shares of common stock ("Shares") of Home Bancorp of Elgin, Inc. (the
"Company") pursuant to an option ("Option") granted under the Plan. If you are
not the person to whom the Option was granted ("Option Recipient") you must
attach to this notice proof of your right to exercise the Option granted under
the Stock Option Agreement entered into between the Company and the Option
Recipient ("Agreement"). This Notice should be personally delivered or mailed by
certified mail, return receipt requested to: Home Bancorp of Elgin, Inc., c/o
Home Federal Savings and Loan Association of Elgin, 16 North Spring Street,
Elgin, Illinois 60120 Attention: Corporate Secretary. The effective date of the
exercise of the Option shall be the earliest date practicable following the date
this Notice is received by the Company, but in no event more than three days
after such date ("Effective Date"). Except as specifically provided to the
contrary herein, capitalized terms shall have the meanings assigned to them
under the Plan. This Notice is subject to all of the terms and conditions of the
Plan and the Agreement.
OPTION INFORMATION Identify below the Option that you are exercising by
providing the following information from the Stock Option Agreement.
Name of Option Recipient:
--------------------------------------------------
Option Grant Date: ,
---------------------------- ----------------
(Month and Day) (Year)
Exercise Price per share: $ _______.___
EXERCISE PRICE Compute the Exercise Price below and select a method of payment.
Total Exercise Price x $ . =
------------------- --------- ----
(No. of Shares) Exercise Price
---------------------
Total Exercise Price
Method of Payment
|_| I enclose a certified check, money order,
or bank draft payable to the order of
Home Bancorp of Elgin, Inc. in the amount of $
----------------
|_| I enclose Shares duly endorsed for transfer
to the Company with all stamps attached and $
having a fair market value of ----------------
Total Exercise Price $
----------------
ISSUANCE OF CERTIFICATES
I hereby direct that the stock certificates representing the Shares
purchased pursuant to section 2 above be issued to the following
person(s) in the amount specified below:
Name and Address Social Security No. No of Shares
- ------------------------------- - -
----- ----- ----- ------------
- -------------------------------
- ------------------------------- - -
----- ----- ----- ------------
- -------------------------------
<PAGE>
WITHHOLDING ELECTIONS For Employee Option Recipients with Non-Qualified Stock
Options only. Beneficiaries and Outside Directors should not complete.
I understand that I am responsible for the amount of federal, state and
local taxes required to be withheld with respect to the Shares to be
issued to me pursuant to this Notice, but that I may request the Company
to retain or sell a sufficient number of such Shares to cover the amount
to be withheld. I hereby request that any taxes required to be withheld
be paid in the following manner [check one]:
|_| With a certified or bank check that I will deliver to the
Committee on the day after the Effective Date of my exercise.
|_| With the proceeds from a sale of Shares that would otherwise be
distributed to me.
|_| Retain shares that would otherwise be distributed to me.
I understand that the withholding elections I have made on this form are
not binding on the Committee, and that the Committee will decide the
amount to be withheld and the method of withholding and advise me of its
decision prior to the Effective Date. I further understand that the
Committee may request additional information or assurances regarding the
manner and time at which I will report the income attributable to the
distribution to be made to me.
COMPLIANCE WITH TAX AND SECURITIES LAWS
I understand that must rely on, and consult with, my own tax and legal
S H counsel (and not the Company) regarding the application of all laws -
particularly tax and securities laws - to the transactions to be effected
I E pursuant to my Option and this Notice. I understand that I will be
responsible for paying any federal, state and local taxes that may become
G R due upon the sale (including a sale pursuant to a "cashless exercise") or
other disposition of Shares issued pursuant to this Notice and that I
N E must consult with my own tax advisor regarding how and when such income
will be reportable. I further understand that if I have elected to have
Shares sold to satisfy tax withholding I may be asked to pay a minimal
amount of such taxes in cash in order to avoid the sale of more Shares
than are necessary.
---------------------------------------------------- ----------------
Signature Date
---------------------------------------------------------------------------
Address
- --------------------------------------------------------------------------------
Internal Use Only
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Corporate Secretary Received [check one] |_| By Hand
|_| By Mail Post Marked
-----------------------------
Date of Post Mark
By
--------------------------------------------- -----------------------------
Authorized Signature Date of Receipt
- --------------------------------------------------------------------------------
<PAGE>
APPENDIX B TO STOCK OPTION AGREEMENT
HOME BANCORP OF ELGIN, INC. 1997 STOCK OPTION PLAN
Beneficiary Designation Form
- --------------------------------------------------------------------------------
General
Information Use this form to designate the Beneficiary(ies) who may exercise
Options outstanding to you at the time of your death.
Name of Person
Making Designation Social Security Number - -
-------------- ----- ---- -----
BENEFICIARY Complete sections A and B. If no percentage shares are specified,
DESIGNATION each Beneficiary in the same class (primary or contingent) shall
have an equal share. If any designated Beneficiary predeceases
you, the shares of each remaining Beneficiary in the same class
(primary or contingent) shall be increased proportionately
A Primary Beneficiary(ies). I hereby designate the following person as my
primary Beneficiary under the Plan, reserving the right to change or revoke this
designation at any time prior to my death:
Name Address Relationship Birthdate Share
%
- ----------------- ------------------ --------- ------- --------
------------------
%
- ----------------- --------- ------- --------
------------------
------------------
%
- ----------------- --------- ------- --------
------------------
Total = 100%
------------------
B Contingent Beneficiary(ies). I hereby designate the following person(s) as my
contingent Beneficiary(ies) under the Plan to receive benefits only if all of my
primary Beneficiaries should predecease me, reserving the right to change or
revoke this designation at any time prior to my death as to all outstanding
Options:
Name Address Relationship Birthdate Share
%
- ----------------- ------------------ --------- ------- --------
------------------
%
- ----------------- --------- ------- --------
------------------
------------------
%
- ----------------- --------- ------- --------
------------------
------------------
<PAGE>
S H I understand that this Beneficiary Designation shall be effective only if
properly completed and received by the Corporate Secretary of Home
I E Bancorp of Elgin, Inc. prior to my death, and that it is subject to all
of the terms and conditions of the Plan. I also understand that an
G R effective Beneficiary designation revokes my prior designations) with
respect to all outstanding Options.
N E
--------------------------------------------- -------------------
Your Signature Date
- --------------------------------------------------------------------------------
Internal Use Only
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
This Beneficiary Designation was received Comments
by the Corporate Secretary of Home Bancorp
of Elgin, Inc. on the date indicated.
By
--------------------------------------- ------------------
Authorized Signature Date
- --------------------------------------------------------------------------------
Exhibit 5
CHICAGO FIRSTAR CENTER SACRAMENTO
DENVER 777 EAST WISCONSIN AVENUE SAN DIEGO
JACKSONVILLE MILWAUKEE, WISCONSIN 53202-5367 SAN FRANCISCO
LOS ANGELES TELEPHONE (414) 271-2400 TALLAHASSEE
MADISON FACSIMILE (414) 297-4900 TAMPA
MILWAUKEE WASHINGTON, D.C.
ORLANDO WEST PALM BEACH
CLIENT/MATTER NUMBER
042326-0101
January 7, 1999
State Financial Services Corporation
10708 West Janesville Road
Hales Corners, Wisconsin 53130
Ladies and Gentlemen:
We have acted as counsel for State Financial Services Corporation, a
Wisconsin corporation (the "Company"), in connection with the preparation of a
Form S-8 Registration Statement (the "Registration Statement") to be filed by
the Company with the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "Securities Act"), relating to 640,645 shares of the
Company's Common Stock, $.10 par value per share (the "Common Stock"), which may
be issued or acquired pursuant to the Home Bancorp of Elgin, Inc. 1997 Stock
Option Plan (the "Plan").
In this regard, we have examined: (a) the Plan; (b) a signed copy of the
Registration Statement; (c) the Company's Amended and Restated Articles of
Incorporation and Bylaws, as amended to date; (d) resolutions of the Company's
Board of Directors relating to the Plan; and (e) such other documents and
records as we have deemed necessary to enable us to render this opinion.
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation validly existing under the laws of the
State of Wisconsin.
2. The shares of Common Stock, when issued by the Company in the manner
contemplated in the Plan, will be validly issued, fully paid and nonassessable,
except with respect to wage claims of, or other debts owing to, employees of the
Company for services performed, but not exceeding six months' service in any one
case, as provided by Section 180.0622(2)(b) of the Wisconsin Business
Corporation Law and judicial interpretations thereof.
<PAGE>
FOLEY & LARDNER
State Financial Services Corporation
January 7, 1999
Page 2
We consent to the use of this opinion as an exhibit to the Registration
Statement. In giving this consent, we do not admit that we are "experts" within
the meaning of Section 11 of the Securities Act or within the category of
persons whose consent is required by Section 7 of the Securities Act.
Yours truly,
/s/FOLEY & LARDNER
FOLEY & LARDNER
Exhibit 23.2
Consent of Independent Auditors
We consent to the incorporation by reference in Registration Statement (Form
S-8) pertaining to the Home Bancorp of Elgin, Inc. 1997 Stock Option Plan of our
report dated January 16, 1998, with respect to the consolidated financial
statements of State Financial Services Corporation incorporated by reference in
its Annual Report (Form 10-K) for the year ended December 31, 1997, filed with
the Securities and Exchange Commission.
January 7, 1999
/s/ Ernst & Young LLP
