<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
GREAT FALLS BANCORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
GREAT FALLS BANCORP
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(j)(2) or
Item 22(a)(2) of Schedule 14A
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3)
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11
1) Title of each class of securities to which transaction applies:
---------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
---------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction pursuant to
Exchange Act Rule 0-11: (Set forth the amount on which the filing fee is
calculated and state how it was determined):
--------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------------
5) Total fee paid:
---------------------------------------------------------------------------
[X] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount previously paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
<PAGE>
GREAT FALLS BANCORP
55 UNION BOULEVARD
TOTOWA, NEW JERSEY 07512
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 30, 1996
- --------------------------------------------------------------------------------
NOTICE IS HEREBY GIVEN THAT the Annual Meeting of Stockholders (the "Annual
Meeting") of Great Falls Bancorp (the "Corporation") will be held at the
Corporation's headquarters located at 55 Union Boulevard, Totowa, New Jersey, at
4:00 p.m. on Tuesday, April 30, 1996, to consider and act upon the following
matters:
1. The election of five directors to serve for the respective terms described
in the accompanying Proxy Statement.
2. Amending the Certificate of Incorporation to change the Corporation's
corporate name to Greater Community Bancorp.
3. Amending the Certificate of Incorporation to increase the authorized Common
Stock from 4 million shares to 10 million shares.
4. The approval of the proposed Great Falls Bancorp 1996 Employee Stock
Option Plan.
5. The approval of the proposed Great Falls Bancorp 1996 Stock Option Plan
for Nonemployee Directors.
6. The transaction of such other business as may properly come before the
Annual Meeting or any adjournments thereof. The Board of Directors is not
aware of any other business to come before the Annual Meeting.
Action may be taken on any one of the foregoing proposals at the Annual
Meeting on the date specified above or on any date or dates to which, by
original or later adjournment, the Annual Meeting may be adjourned. Only
stockholders of record at the close of business on March 1, 1996, are entitled
to notice of and to vote at the Annual Meeting and any adjournments thereof.
A Proxy Card and a Proxy Statement relating to the Annual Meeting are
enclosed. You are requested to fill in and sign the enclosed Proxy Card which
is solicited by the Board of Directors and to mail it promptly in the enclosed
envelope. Stockholders are cordially invited to attend the meeting in person.
If you attend the Annual Meeting and vote in person, the enclosed Proxy Card
will not be used.
By order of the Board of Directors,
Edith A. Leonhard, Secretary
Totowa, New Jersey
April 1, 1996
- --------------------------------------------------------------------------------
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE YOUR CORPORATION THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES IN ORDER TO INSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN
THE UNITED STATES.
- --------------------------------------------------------------------------------
<PAGE>
PROXY STATEMENT OF
GREAT FALLS BANCORP
55 UNION BOULEVARD
TOTOWA, NEW JERSEY 07512
201-942-1111
- --------------------------------------------------------------------------------
1996 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 30, 1996
- --------------------------------------------------------------------------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Great Falls Bancorp (the "Corporation")
to be used at the 1996 Annual Meeting of Stockholders of the Corporation (the
"Annual Meeting") to be held at the Corporation's headquarters located at 55
Union Boulevard, Totowa, New Jersey on Tuesday, April 30, 1996 at 4:00 p.m.
The accompanying Notice of Annual Meeting and form of Proxy and this Proxy
Statement are being first mailed to stockholders on or about April 1, 1996.
- --------------------------------------------------------------------------------
PURPOSES OF ANNUAL MEETING; VOTING AND REVOCABILITY OF PROXIES
- --------------------------------------------------------------------------------
PURPOSES OF THE ANNUAL MEETING
Five matters will be presented at the Annual Meeting to be considered and
voted upon. These are (1) the election of directors (see "PROPOSAL ONE--
ELECTION OF DIRECTORS"), (2) approval of an amendment to the Corporation's
Certificate of Incorporation changing its corporate name (see "PROPOSAL TWO--
APPROVAL OF AMENDMENT TO CERTIFICATE OF INCORPORATION CHANGING THE
CORPORATION'S CORPORATE NAME TO GREATER COMMUNITY BANCORP"), (3) approval of
a second amendment to the Certificate of Incorporation increasing the number
of shares of authorized Common Stock (see "PROPOSAL THREE--APPROVAL OF
AMENDMENT TO CERTIFICATE OF INCORPORATION INCREASING AUTHORIZED COMMON
STOCK"), (4) approval of a proposed new stock option plan for employees (see
"PROPOSAL FOUR--APPROVAL OF GREAT FALLS BANCORP 1996 EMPLOYEE STOCK OPTION
PLAN"), and (5) approval of a proposed new stock option plan for nonemployee
directors (see "PROPOSAL FIVE--APPROVAL OF GREAT FALLS BANCORP 1996 STOCK
OPTION PLAN FOR NONEMPLOYEE DIRECTORS").
Except for those five matters, the Board of Directors does not know of any
other matter to be presented for consideration at the Annual Meeting. Should
any other matter come before the Annual Meeting, however, the persons named
in the accompanying Proxy will have the discretionary authority to vote all
Proxies with respect to any such other matter in accordance with their
judgment.
QUORUM; VOTES REQUIRED
The presence at the Annual Meeting, in person or by proxy, of shares
entitled to cast a majority of the votes constitutes a quorum. Each share of
Common Stock is entitled to one vote on each matter to come before the Annual
Meeting. Directors shall be elected by a plurality of the votes cast, in
person or by proxy, by the holders of shares entitled to vote at the Annual
Meeting. Approval of the other matters to come before the Annual Meeting
will require the affirmative vote of a majority of the votes cast, in person
or by proxy, by the holders of Common Stock entitled to vote at the Annual
Meeting.
VOTING OF PROXY
Proxies solicited by the Board of Directors will be voted in accordance
with the directions given therein. WHERE NO INSTRUCTIONS ARE INDICATED,
PROXIES WILL BE VOTED FOR THE NOMINEES FOR DIRECTORS SET FORTH BELOW, FOR
APPROVAL OF THE TWO PROPOSED AMENDMENTS TO THE CERTIFICATE OF INCORPORATION,
AND FOR APPROVAL OF THE TWO PROPOSED STOCK OPTION PLANS. The proxy confers
discretionary authority on the persons named therein to vote with respect to
the election of any person as director where the nominee is unable to serve
or for good cause
<PAGE>
will not serve, and with respect to matters incident to the conduct of the
Annual Meeting. If any other business is presented at the Annual Meeting,
proxies will be voted by those named therein in their discretion. Proxies
marked as abstentions will not be counted as votes cast. In addition, shares
held in street name which have been designated by brokers on proxy cards as
not voted will not be counted as votes cast. Proxies marked as abstentions
or as broker no votes will, however, be treated as shares present for
purposes of determining whether a quorum is present.
REVOCABILITY OF PROXY
Stockholders who execute proxies retain the right to revoke them at any
time prior to the voting thereof. Unless so revoked, the shares represented
by properly executed proxies will be voted at the Annual Meeting and all
adjournments thereof. Proxies may be revoked by written notice to the
Corporation's Secretary at the above address or by the filing of a later
dated proxy prior to a vote being taken on a particular proposal at the
Annual Meeting. A proxy will not be voted if a stockholder attends the
Annual Meeting and votes in person. A stockholder's mere presence at the
Annual Meeting will not revoke such stockholder's proxy.
- --------------------------------------------------------------------------------
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
- --------------------------------------------------------------------------------
The securities entitled to vote at the Annual Meeting consist of the
Corporation's common stock, $1.00 par value per share (the "Common Stock").
As of the close of business on March 1, 1996 (the "Record Date"), 1,709,451
shares of Common Stock were issued and outstanding. Only stockholders of
record of Common Stock on the Record Date are entitled to notice of and to
vote at the Annual Meeting or any adjournments thereof.
At March 1, 1996 the Corporation knew of no individual or group which
beneficially owned more than 5% of the Common Stock, other than John L.
Soldoveri and Alfred R. Urbano, both of whom are directors of the
Corporation. Details of their stock ownership are set forth below (see
"PROPOSAL ONE--ELECTION OF DIRECTORS--Security Ownership of Management").
PROPOSAL ONE
ELECTION OF DIRECTORS
Under the Corporation's Certificate of Incorporation, directors are
divided into three classes and elected for terms of three years and until
their successors are elected and qualified. Each class of directors is to
consist, as nearly as may be, of one-third of the number of directors then
constituting the whole Board. The Corporation's Board of Directors is
currently comprised of ten members, three of whom became directors effective
at the end of 1995 in connection with the consummation of the Corporation's
acquisition of Bergen Commercial Bank. The terms of office of those three
members and two previously elected directors will end at the time of the
election of their successors at the Annual Meeting. The terms of the other
five directors will continue beyond the Annual Meeting.
For the coming year the Board of Directors has fixed the total number of
directors at ten. Five persons are to be elected at the Annual Meeting for
terms of either two years or three years as described below. Under New
Jersey law, directors are elected by a plurality of the votes present in
person or represented by proxy at the Annual Meeting and entitled to vote on
the election of directors.
The Board of Directors, which has no nominating committee, has nominated
Anthony M. Bruno, Jr., C. Mark Campbell, Joseph A. Lobosco, John L.
Soldoveri, and Charles J. Volpe, each of whom is a member of the current
Board whose term expires in 1996, for reelection. Mr. Bruno has been
nominated to serve for a two-year term expiring in 1998, and Messrs.
Campbell, Lobosco, Soldoveri and Volpe have been nominated
2
<PAGE>
to serve for three-year terms expiring in 1999. All of such terms will
continue until the years in which their terms expire and their respective
successors are elected and have qualified.
Other nominations may be made pursuant to the Corporation's Bylaws, which
require, among other things, that advance written notice of any such
nomination be delivered or mailed to the Chairman of the Board of the
Corporation. Any such written nomination shall be delivered or mailed not
less than 14 days prior to the Annual Meeting, that is, on or before April 2,
1996, provided, that if less than 21 days' notice of the Annual Meeting is
given to stockholders, then such nomination shall be mailed or delivered to
the Chairman of the Board not later than the close of business on the seventh
day following the day on which the Notice of Annual Meeting was mailed.
The Corporation's Bylaws permit the Board of Directors to increase the
number of directors by not more than two members, and to fill the vacancies
created by such increase, between Annual Meetings of Stockholders. In the
event of any such increase in the number of directors by the Board, the terms
of the directors filling such vacancies shall be fixed by the Board in such
manner as to result in each class consisting, as nearly as may be, of one-
third of the number of directors then constituting the whole Board as so
increased. A director elected by the Board to fill a vacancy created in such
manner will serve only until the next Annual Meeting of Stockholders, at
which time the stockholders will elect such director's successor for the
succeeding term, or if applicable, for the remaining portion of the full term
previously fixed by the Board. The Board of Directors has no plans at the
present time to make any such increase and fill vacancies prior to the Annual
Meeting.
It is intended that the persons named as proxies in the Proxy Cards
solicited by the Board of Directors will vote for the election of the named
nominees. If any nominee is unable to serve, the shares represented by all
properly executed proxies which have not been revoked will be voted for the
election of such substitute as the Board of Directors may recommend or the
size of the Board may be reduced to eliminate the vacancy. At this time the
Board knows of no reason why any nominee might be unable to serve.
The following table sets forth, for each nominee and each continuing
director, his name, age as of the Record Date and the year he first became a
director of the Corporation. The table also sets forth the names, ages and
positions of the Corporation's current executive officers and the year each
was first elected to his current position. Each director of the Corporation
is also a member of the Board of Directors of either Great Falls Bank (GFB)
or Bergen Commercial Bank (BCB), as indicated on the table.
BOARD NOMINEE FOR TWO-YEAR TERM EXPIRING AT ANNUAL MEETING IN 1998
Age as of First year as a
Name Record Date Director of Corporation
- ------------------------- ------------ ------------------------
Anthony M. Bruno, Jr. 41 1995/1/
(BCB)
/1/ Mr. Bruno was one of the original directors of both Great Falls Bancorp
and Great Falls Bank in 1985, but resigned in 1987 in connection with the
formation of Bergen Commercial Bank.
BOARD NOMINEES FOR THREE-YEAR TERMS EXPIRING AT ANNUAL MEETING IN 1999
Age as of First year as a
Name Record Date Director of Corporation
- -------------------------- ------------ ------------------------
C. Mark Campbell (BCB) 45 1995
Joseph A. Lobosco (GFB) 61 1990
John L. Soldoveri (GFB) 72 1995
Charles J. Volpe (BCB) 58 1995
DIRECTORS CONTINUING IN OFFICE
3
<PAGE>
<TABLE>
<CAPTION>
Age as of First Year as a Year of Expiration
Name Record Date Director of of Term as a Director
- ---------------------------------------------------- ------------------ Corporation -------------------------
<S> <C> <C> <C>
M.A. Bramante (GFB) 63 1985 1997
Robert J. Conklin (GFB) 57 1985 1997
William T. Ferguson (GFB) 53 1985 1997
George E. Irwin (GFB) 52 1987 1998
Alfred R. Urbano (GFB) 49 1986 1998
</TABLE>
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
Year First
Age as of Elected to
Name Office the Record Date Current Office
- ------------------------------- ------------------- --------------- --------------
<S> <C> <C> <C>
John L. Soldoveri Chairman and Chief 72 1985
Executive Officer
Anthony M. Bruno, Jr. Vice Chairman 41 1995
George E. Irwin President and 52 1995
Chief
Operating Officer
C. Mark Campbell Executive Vice 45 1995
President
Naqi A. Naqvi Treasurer 39 1987
</TABLE>
4
<PAGE>
Presented below is certain additional information concerning the directors
and executive officers of the Corporation.
Marino A. Bramante, an orthodontist, has been the President of M.A.
Bramante, D.D.S., P.A. since 1960. He has served as a founding director of
both the Corporation and Great Falls Bank since 1985.
Anthony M. Bruno, Jr. was appointed as a director and Vice Chairman of the
Board of Directors of the Corporation at the end of 1995 in connection with
the Corporation's acquisition of Bergen Commercial Bank. Mr. Bruno has been
Chairman of the Board of Bergen Commercial Bank since 1987. Prior thereto
Mr. Bruno was a founding director of the Corporation and the Bank in 1985,
positions from which he resigned in 1987 when Bergen Commercial Bank was
formed. Mr. Bruno is a senior partner of Bruno, DiBello & Co., L.L.C.,
Certified Public Accountants. Mr. Bruno is a minority partner in Anjo
Realty, which invests in real estate. Mr. Bruno is a nephew of Mr. Soldoveri
and is Mr. Campbell's brother-in-law.
C. Mark Campbell was appointed as a director and Executive Vice President
of the Corporation at the end of 1995 in connection with the Corporation's
acquisition of Bergen Commercial Bank. He has acted as President and Chief
Executive Officer and a director of Bergen Commercial Bank since 1987. Mr.
Campbell is Mr. Bruno's brother-in-law.
Robert J. Conklin has been the President of The Conklin Corporation, which
is engaged in construction and engineering, since 1960. He is also President
of an electronics firm, Crystal Accel. He has been a founding director of
both the Corporation and Great Falls Bank since 1985.
William T. Ferguson has been the Vice President of Ted Car Inc., an auto
wholesaler, since 1977. He has served as a founding director of both the
Corporation and Great Falls Bank since 1985.
George E. Irwin was appointed as the President and Chief Operating Officer
of the Corporation at the end of 1995. Prior thereto Mr. Irwin had served
since 1987 as the Corporation's Vice President. He has been the President
and Chief Executive Officer of Great Falls Bank since 1987. During 1986 Mr.
Irwin was the Bank's Executive Vice President, Treasurer, and Senior Loan
Officer. He has been a director of both the Corporation and Great Falls Bank
since 1987.
Joseph A. Lobosco retired at the end of 1994 as the Senior Partner of
Joseph Lobosco & Sons, an insurance agency, of which he had been a partner
since 1961. He has served as a director of both the Corporation and Great
Falls Bank since 1990.
John L. Soldoveri is the Chairman of the Board of Directors and Chief
Executive Officer of the Corporation. He was appointed to the latter
position at the end of 1995, having acted as the Corporation's President from
1985 until the end of 1995. Mr. Soldoveri has been a founding director of
both the Corporation and Great Falls Bank since 1985. Mr. Soldoveri was
President of Soldoveri Agency and Rhodes Agency Inc., real estate brokerage
and insurance agency firms, for many years until 1991. He has served as Vice
President of both companies since 1991. Mr. Soldoveri has been the
controlling partner in Anjo Realty since 1980 and is an active investor in
real estate, directly and through various entities. Mr. Soldoveri is Mr.
Bruno's uncle.
Alfred R. Urbano has been the President of Rubicon Realty Corp., a real
estate investment firm, since 1980. He is active in the real estate business
as an investor and a manager, directly and through various entities. Mr.
Urbano has served as a director of both the Corporation and Great Falls Bank
since 1986.
Charles J. Volpe was appointed as a director and Executive Vice President
of the Corporation at the end of 1995 in connection with the Corporation's
acquisition of Bergen Commercial Bank. Mr. Volpe is the chief executive
officer and principal of J.P. Patti Company (roofing). He has been a
director of Bergen Commercial Bank since 1987.
Naqi A. Naqvi has been the Corporation's Treasurer since 1988, and Vice
President and Treasurer of Great Falls Bank since 1987.
5
<PAGE>
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MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
- --------------------------------------------------------------------------------
The Corporation's Board of Directors conducts its business through meetings
of the Board of Directors and its committees. The Board meets monthly on a
regular basis and may also have special meetings. During the year ended
December 31, 1995, the Corporation's full Board held fourteen meetings. No
director attended fewer than 75% in the aggregate of the total number of
Board meetings held during 1995 and the total number of meetings held by
committees on which he served during such year.
The Board has a standing Audit Committee, consisting of Messrs. Bramante
(Chairman), Soldoveri and Urbano. Such Committee met twice during 1995. The
Audit Committee performs the following customary functions: (i) recommending
to the Board of Directors the appointment of the Corporation's independent
auditors; (ii) reviewing and approving in advance for each year the audit and
non-audit services and fees of such auditors; (iii) meeting separately and
privately with the independent auditors and the Corporation's internal
auditors, if any, to insure that the scope of their activities has not been
restricted, and to consider other matters generally pertaining to their
examinations; (iv) reviewing the adequacy of internal financial and
accounting controls and the results of the auditors' examinations thereof;
(v) reviewing matters relating to corporate financial reporting and
accounting policies and procedures; and (vi) reporting its findings on any of
the above to the Board of Directors, as appropriate.
The Board also has a standing Stock Option Committee. During 1995 this
committee was comprised of Messrs. Bramante, Conklin, and Soldoveri. The
Stock Option Committee makes recommendations to the Board concerning options
to be granted under the Corporation's stock option plans and generally to
administer such Plans. Such Committee did not meet during 1995.
Except for the Audit and Stock Option Committees, there were no nominating,
compensation, or other committees of the Corporation's Board of Directors in
existence during 1995. The full Board thus in effect acted as such
committees.
In addition, seven of the Corporation's directors serve as directors of
Great Falls Bank, and in that capacity various Board members also serve on
committees of Great Falls Bank's Board of Directors and through these
committees coordinate the functions of the Corporation and Great Falls Bank.
During 1995, committees of Great Falls Bank's Board included the Audit
Committee, the Executive Committee, the Loan Committee, the Personnel
Committee, the Business Development and Marketing Committee, the Investment
Committee, and the Security and Insurance Committee.
Similarly, three of the Corporation's directors serve as directors of
Bergen Commercial Bank, and in that capacity they served on committees of
Bergen Commercial Bank's Board of Directors. During 1995, committees of
Bergen Commercial Bank's Board included the Audit/Examining Committee, the
Executive Committee, the Investment/Financial Committee, the Loan Committee,
the Personnel/Compensation Committee, and the Marketing Committee.
Effective with the Corporation's acquisition of Bergen Commercial Bank at
the end of 1995, the Board of Directors of the Corporation established two
additional standing committees, the Executive Committee and the Management
Coordinating Committee. The members of the Executive Committee are Messrs.
Bramante, Bruno, Conklin, Irwin, Soldoveri and Urbano. Its duties will be to
carry out the responsibilities of the Corporation's Board of Directors
between meetings of the full Board. The members of the Management
Coordinating Committee are Messrs. Campbell, Irwin, and Bruno. Its duties
will be to coordinate the policies and operations of Great Falls Bank and
Bergen Commercial Bank. The first meetings of these two new committees were
during 1996. See also "PROPOSAL FOUR--APPROVAL OF GREAT FALLS BANCORP 1996
EMPLOYEE STOCK OPTION PLAN--Administration" for information concerning the
committee established in 1996 to administer the Employee Plan.
6
<PAGE>
- --------------------------------------------------------------------------------
EXECUTIVE COMPENSATION AND OTHER BENEFITS
- --------------------------------------------------------------------------------
SUMMARY COMPENSATION TABLE
The following table summarizes compensation earned or awarded during the
years ended December 31, 1995, 1994 and 1993 to the Corporation's Chief
Executive Officer and its other executive officers whose total salary and
bonus in 1995 exceeded $100,000. Although all of Mr. Campbell's compensation
was earned prior to the Corporation's acquisition of Bergen Commercial Bank,
it is included in the following table because that acquisition was
consummated immediately prior to the end of 1995 and is being accounted for
on a pooling of interests basis.
<TABLE>
<CAPTION>
Annual Compensation
Long Term
Compensation
- -------------------------------------------------------------------------------
Name and Principal Position in Salary Bonus Other Annual Stock Options
1995 Year ($) ($) Compensation ($) Awarded (#)/(1)/
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
JOHN L. SOLDOVERI 1995 0 0 19,100 /(2)/ 3,300
President and Chief Executive 1994 0 0 20,238 /(2)/ 0
Officer of the Corporation 1993 0 0 13,638 /(2)/ 2,662
- ---------------------------------------------------------------------------------------------------------
GEORGE E. IRWIN 1995 135,035 10,000 39,557 /(3)/ 0
President of Great Falls Bank 1994 127,530 0 42,036 /(3)/ 12,870
1993 118,535 0 34,566 /(3)/ 0
- ---------------------------------------------------------------------------------------------------------
C. MARK CAMPBELL 1995 139,812 12,000/(4)/ 10,518/(4)/ 0
President of Bergen 1994 124,635 12,500/(4)/ 0 0
Commercial Bank 1993 110,115 10,000/(4)/ 0 0
- ---------------------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
/(1)/ The numbers of shares underlying stock options awarded in 1995, 1994
and 1993 have been adjusted to reflect increases in such shares
resulting from the Corporation's payment of stock dividends
after the awards.
/(2)/ Primarily represents fees paid for attendance at meetings of the Board
of Directors of Great Falls Bank and committees of that Board. The 1995
and 1994 amounts also include monthly stipends totalling $9,000 and
$8,500 during those years. The 1995, 1994 and 1993 amounts include
compensation of $6,808, $2,563 and $1,188, respectively, realized upon
Mr. Soldoveri's exercise of options to purchase Common Stock during
those years.
/(3)/ These amounts include employer contributions on behalf of Mr. Irwin to
the Corporation's 401K Plan ($20,370 for 1995, $16,324 for 1994, and
$14,612 for 1993). The amounts for 1994 and 1993 also include
compensation of $16,712 and $10,954 realized by Mr. Irwin, respectively,
upon his exercise of stock options during those two years. Finally,
these amounts also include an auto allowance of $750 per month, or
$9,000 per year, for each of the three years indicated and $1,187 for
term life insurance.
/(4)/ Mr. Campbell's Other Annual Compensation for 1995 is comprised of
$6,673 realized upon his exercise of options to purchase Common Stock
during 1995, $2,062 auto expense reimbursement, and $1,783 for group
term life insurance.
OPTION GRANTS DURING 1995
The Corporation currently maintains three stock option plans. The 1988
Nonstatutory Stock Option Plan ("1988 Plan") permits the grant of stock
options to employees of the Corporation and its subsidiaries on conditions
stated in that plan. The 1993 Stock Option Plan ("1993 Plan") and the 1995
Stock Option Plan ("1995 Plan") both provide for the grant of options to
nonemployee directors of Great Falls Bank.
No options were granted under either the 1988 Plan or the 1993 Plan during
1995.
In April, 1995, following approval of the 1995 Plan by the Corporation's
Stockholders at the 1995 Annual Meeting, the Board of Directors granted
options to purchase 3,300 shares at an exercise price of $11.36 per share to
each of the nine nonemployee directors of Great Falls Bank at that time (the
number of shares and the option exercise price are adjusted for the 1995
stock dividend). The option price was equal to the mean between the bid and
asked prices for the Common Stock on February 28, 1995, the valuation date
provided in the 1995 Plan.
The following table contains information concerning the grant of stock
options during 1995 to the named executive officer of the Corporation.
<TABLE>
<CAPTION>
Individual Grants
Number of % of Total Options Exercise or Base
Securities Granted to Employee in Price Expiration
Name Underlying Options Fiscal Year ($/share) Date
Granted (#)
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
John L. Soldoveri 3,300 /(1)/ n/a /(2)/ $11.36 12/31/02
- -------------------------------------------------------------------------------------------------
</TABLE>
/(1)/ Mr. Soldoveri's options become exercisable at the rate of 1/3 each in
October, 1995, January, 1996 and January, 1997. All such options will
lapse on December 31, 1997, subject to an earlier lapse in the event of
a termination of his status as a director.
/(2)/ Mr. Soldoveri is not an employee of the Corporation. The options
granted to Mr. Soldoveri under the 1995 Plan were 11.1% of the total
options granted under that Plan during 1995.
8
<PAGE>
OPTION EXERCISES AND YEAR-END OPTION VALUE
The following table sets forth information with respect to the named
executive officers of the Corporation concerning their exercise of options
during 1995 and unexercised options held on December 31, 1995.
<TABLE>
<CAPTION>
Number of Shares Dollar Value of
Underlying Unexercised Unexercised
Options at Fiscal Year End In-the-Money
Options at Fiscal
Year End /(1)/
- ---------------------------------------------------------------------------------------------
# of Shares Exercisable Exercisable
Acquired Value (E)/ (E)/
on Realized Unexercisable Unexercisable
Name Exercise ($) (U) (U)
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
John L. Soldoveri 665 $6,808 1,766 (E) $13,849 (E)
2,200 (U) $14,058 (U)
- ---------------------------------------------------------------------------------------------
George E. Irwin 0 n/a 998 (E) $ 10,220 (E)
17,196 (U) /(2)/ $126,538 (U)
- ---------------------------------------------------------------------------------------------
</TABLE>
/(1)/ All unexercised options held by the named individuals were "in-the-
money" at the end of 1995. The year-end values of such options have
been calculated as the difference between (a) $17.75, the value of
shares subject to such options using the mean between the bid and asked
prices per share of the Common Stock at the close of business on
December 29, 1995, the last business day of 1995, as quoted by Ryan,
Beck & Co., a principal market maker in the Common Stock, and (b) the
aggregate price payable to the Corporation upon exercise of such
options.
/(2)/ 17,196 options held by Mr. Irwin were unexercisable at December 31,
1995 because the earliest permitted exercise dates are after that date.
The exercisability of 12,870 of such options is subject to the further
condition that the Corporation achieve certain annual performance
standards.
CERTAIN AGREEMENTS
In December, 1987, the Corporation entered into an agreement to continue
Mr. Irwin's employment as Vice President of the Corporation and President and
Chief Executive Officer of Great Falls Bank. The agreement was for an
initial period of one year commencing January 1, 1988, subject to provisions
for earlier termination and for annual extensions. The agreement has been
extended for 1996 at an annual salary of $150,000, plus an auto allowance of
$750 per month and certain other benefits.
DIRECTORS' COMPENSATION
During 1995 the Corporation's directors were compensated for services
rendered in that capacity at the rate of $200 per meeting attended. The
Corporation paid a total of $12,800 to its directors for 1995 in that
capacity.
During 1995 Great Falls Bank's directors were compensated $250 for each
meeting of the Board of Great Falls Bank attended, $150 for each Executive
Committee meeting attended, $100 for each Loan Committee meeting attended,
and $75 for each meeting attended of each other committee of Great Falls
Bank's Board. Great Falls Bank paid a total of $56,700 in directors fees
during 1995 to all directors of Great Falls Bank for acting in those
capacities, of which $39,050 was paid to those Bank directors who are also
directors of the Corporation.
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During 1995 Bergen Commercial Bank's directors who attended at least 75% of
all scheduled meetings were compensated $300 for each Board meeting attended.
Bergen Commercial Bank's directors were also compensated $50 for each
committee meeting which they attended. Bergen Commercial Bank paid a total
of $49,300 in directors fees during 1995 to all directors of Bergen
Commercial Bank for acting in those capacities.
As of January 1, 1996 the fees to the Corporation's Directors were
increased to $350 for each regular Board Meeting attended and $150 for each
Executive Committee Meeting attended. There will be no fees paid to the
newly formed Management Coordinating Committee. The fees for the directors
of both Great Falls Bank and Bergen Commercial Bank were also increased as of
January 1, 1996 to $350 for each regular Board Meeting attended, $100 for
each Loan Committee meeting attended, and $75 for each meeting of all other
Committees attended.
In addition, during 1995 each of the Corporation's nonemployee directors
realized value upon the exercise of options to purchase shares of Common
Stock. Dr. Bramante realized $6,560 and Mr. Urbano realized $13,130 upon the
exercise during November, 1995 of options to purchase 665 shares and 1,331
shares, respectively, granted under the 1993 Plan. Mr. Lobosco realized
$20,651 upon the exercise during December, 1995 of options to purchase 2,431
shares granted under the 1993 Plan and the 1995 Plan. At the end of
December, 1995, Messrs. Conklin, Ferguson, and Soldoveri each exercised
options under the 1993 Plan to purchase 665 shares, each of them thereby
realizing a value of $6,808.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The building in which the Corporation's offices and Great Falls Bank's main
branch are situated is owned by Anjo Realty, a partnership in which Mr.
Soldoveri, Chairman of the Board and Chief Executive Officer of the
Corporation, has a 51% interest, and Mr. Bruno, Vice Chairman of the
Corporation, has a 14% interest. The leased premises during 1995 consisted
of 10,354 square feet at an annual rental of $146,490. As a result of the
continued expansion of both the Corporation and Great Falls Bank, effective
January 1, 1996 the leased premises increased to 13,973 square feet, with the
rent increasing by $46,140 to an annual rental of $192,630. Management
believes the rental paid to Anjo Realty is at or below the fair rental value
of comparable office space.
The Corporation provides a liability insurance policy for all of its
officers and directors and the officers and directors of the two bank
subsidiaries. Coverage is provided by a policy with a major insurance
company in the aggregate amount of $1,500,000, with a standard deductible
amount per claim. The policy also insures the Corporation against amounts
paid by it to indemnify directors and officers. The policy covering the
Corporation and Great Falls Bank ran for a period of one year from January 1,
1995 to January 1, 1996 at a cost to the Corporation of $13,731. During 1995
Bergen Commercial Bank maintained a similar policy for its directors and
officers at a cost of $17,113. For 1996 the Corporation's policy has been
expanded to cover Bergen Commercial Bank's officers and directors and to
increase the coverage to the aggregate amount of $3,000,000 at a cost of
$24,656.
Directors and officers of the Corporation and their associates were
customers of and had transactions with both Great Falls Bank and Bergen
Commercial Bank during 1995, and it is expected that they will continue to
have such transactions in the future. All deposit accounts, loans and
commitments comprising such transactions were made in the ordinary course of
business of the respective banks on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable
transactions with other persons, and in the opinion of management did not
involve more than normal risks of collectibility or present other unfavorable
features. At December 31, 1995, the total amount of loans outstanding from
Great Falls Bank and Bergen Commercial Bank in the aggregate to the executive
officers and directors of the Corporation was $4,530,648 which represented
23% of the Corporation's consolidated stockholders' equity on that date. At
that date, Great Falls Bank and Bergen Commercial Bank in the aggregate also
had commitments to extend credit under revolving lines of credit totalling
$1,444,850 at various rates, to the Corporation's directors, executive
officers and their affiliates.
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- --------------------------------------------------------------------------------
SECURITY OWNERSHIP OF MANAGEMENT
- --------------------------------------------------------------------------------
The following table sets forth information concerning beneficial ownership
of Common Stock on January 31, 1996 by each director and executive officer of
the Corporation and by all directors and executive officers of the
Corporation as a group. All directors and executive officers have an address
c/o Great Falls Bancorp, 55 Union Boulevard, Totowa, New Jersey 07512. All
shares of a named person are deemed to be subject to that person's sole
voting power and sole investment power unless otherwise indicated.
<TABLE>
<CAPTION>
Name of Amount and Nature of
Beneficial Owner Beneficial Ownership(*) Percent of Class(**)
- --------------------------------------------------------------------------------------------
<S> <C> <C>
Marino A. Bramante 63,386 (a) 3.65%
Anthony M. Bruno, Jr. 38,070 (b) 2.23%
C. Mark Campbell 28,155 (c) 1.65%
Robert J. Conklin 57,487 (d) 3.31%
William T. Ferguson 18,984 (e) 1.11%
George E. Irwin 37,879 (f) 2.21%
Joseph A. Lobosco 25,176 (g) 1.46%
John L. Soldoveri 179,199 (h) 10.27%
Alfred R. Urbano 105,614 (i) 6.13%
Charles J. Volpe 25,804 (j) 1.51%
Naqi A. Naqvi 3,019 (k) 0.18%
All directors and executive officers as a
group (11 in number) 582,773 (a)-(l) 31.90%
</TABLE>
/(*)/ Unless otherwise noted, all shares are owned of record and
beneficially by the named person. Beneficially owned shares include shares
over which the named person exercises either sole or shared voting power or
sole or shared investment power. It also includes shares (i) owned by a
spouse, minor children or by relatives sharing the same home, (ii) owned by
entities owned or controlled by the named person, and (iii) with respect to
which the named person has the right to acquire such shares within 60 days
by the exercise of any right or option. Such options include the right to
purchase shares pursuant to Cancellable Mandatory Stock Purchase Contracts
due November 1, 1997 ("Equity Contracts"). In accordance with the
Securities and Exchange Commission's rules relating to the computation of
beneficial ownership, the percentage of common stock beneficially owned by
a person or group assumes the exercise of options held by such person or
group but the nonexercise of options held by all other persons.
/(**)/ Based upon 1,709,451 shares issued and outstanding on January 31,
1996.
(a) Includes 10,474 shares held by Dr. Bramante's wife and 25,579 shares held
by Dr. Bramante's employer's retirement trust (the "Bramante Trust") and
1,244 shares held indirectly by a corporation. Also includes 25,398
shares which Dr. Bramante has the right to acquire pursuant to Equity
Contracts owned by the Bramante Trust and his wife (22,532 shares) and
stock options held by Dr. Bramante (2,866 shares).
(b) Includes 17,576 shares held by Mr. Bruno's wife and 9,469 shares held in
his self-directed IRA.
(c) Includes 6,483 shares held in a 401K Plan, 1,295 held by Mr. Campbell as
custodian for his minor children, 1,089 shares held by a trust of which
Mr. Campbell is a trustee, and 1,659 shares subject to stock options.
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<PAGE>
(d) Includes 20,210 shares held by a corporation owned by Mr. Conklin and his
wife and 460 shares owned by his wife. Also includes 25,211 shares which
Mr. Conklin has the right to acquire pursuant to stock options (2,866
shares) and Equity Contracts (22,345 shares, of which 3,724 shares are
held by his wife alone).
(e) Includes 2,866 shares subject to stock options, 1,857 shares owned by Mr.
Ferguson's children, and 1,857 shares owned by a corporation of which Mr.
Ferguson is a shareholder. Mr. Ferguson disclaims beneficial ownership
of the shares held by such corporation except his pro rata interest
therein, consisting of 929 shares.
(f) Includes 1,298 shares owned by a corporation controlled by Mr. Irwin, 182
shares owned by his children, and the right to acquire 3,069 shares
pursuant to stock options.
(g) Includes 2,417 shares owned by Mr. Lobosco's wife. Also includes Mr.
Lobosco's right to acquire beneficial ownership of a total of 10,299
shares, pursuant to Equity Contracts (8,099 shares) and stock options
(2,200 shares).
(h) Includes 27,013 shares owned by Mr. Soldoveri's wife. Also includes
34,998 shares which Mr. Soldoveri has the right to acquire pursuant to
Equity Contracts (29,795 shares for Mr. Soldoveri and 2,327 shares for
his wife) and stock options (2,866 shares).
(i) Includes Mr. Urbano's right to acquire beneficial ownership of a total of
12,157 shares, pursuant to Equity Contracts (as to 9,957 shares) and
stock options (2,200 shares).
(j) Includes 1,662 shares held by Mr. Volpe's wife.
(k) Includes Mr. Naqvi's right to acquire 1,504 shares pursuant to stock
options.
(l) The total for all directors and executive officers includes the right to
acquire 117,151 shares pursuant to Equity Contracts and stock options.
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PROPOSAL TWO
APPROVAL OF AMENDMENT TO CERTIFICATE OF INCORPORATION
CHANGING THE CORPORATION'S CORPORATE NAME TO
GREATER COMMUNITY BANCORP
AMENDMENT REGARDING CHANGE OF CORPORATE NAME
The Corporation's Board of Directors has adopted an amendment to the
Corporation's Certificate of Incorporation changing the Corporation's
corporate name to "Greater Community Bancorp" (the "Name Change Amendment").
REASON FOR THE NAME CHANGE AMENDMENT
As a result of the Corporation's acquisition of all of the stock of Bergen
Commercial Bank at the end of 1995, the Corporation became the owner of two
separate bank subsidiaries, Great Falls Bank and Bergen Commercial Bank.
These two bank subsidiaries are independently managed by their separate
Boards of Directors (subject to oversight by the Corporation's own Board of
Directors and coordination of their policies and operations by the Board's
Management Coordinating Committee), and they operate in the separate
communities which define their respective geographical market areas.
The Corporation's Board of Directors is actively considering the
possibility of acquiring other community banks in New Jersey. Consistent
with the Board's philosophy with respect to the manner in which Bergen
Commercial Bank conducts its business, the Board's present philosophy would
be to permit other acquired banks, if any, to continue as separate community
banks independently managed by their separate Boards of Directors and
operating in their own geographical market areas.
The Board therefore selected a new corporate name for the Corporation which
the Board believes reflects the Corporation's current business structure and
philosophy more accurately than the present corporate name.
The change of the Corporation's corporate name will not affect the names of
either Great Falls Bank or Bergen Commercial Bank, both of which will
continue to operate as community banks under their existing names.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR APPROVAL
OF THE AMENDMENT TO THE CERTIFICATE OF INCORPORATION CHANGING THE CORPORATE
NAME TO GREATER COMMUNITY BANCORP.
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PROPOSAL THREE
APPROVAL OF AMENDMENT TO CERTIFICATE OF INCORPORATION
INCREASING AUTHORIZED COMMON STOCK
AMENDMENT REGARDING INCREASE
The Board of Directors has unanimously adopted a second amendment to the
Certificate of Incorporation to increase the Corporation's authorized Common
Stock from 4,000,000 to 10,000,000 shares (the "Capital Increase Amendment").
In order to become effective, the Capital Increase Amendment requires
shareholder approval by the affirmative vote of a majority of the votes cast
by holders of the Common Stock at a meeting of shareholders.
The Corporation is presently authorized to issue a total of 5,000,000
shares of capital stock, consisting of 4,000,000 shares of common stock,
$1.00 par value per share ("Common Stock"), and 1,000,000 shares of preferred
stock without par value and otherwise with presently unspecified rights
("Preferred Stock"). Common Stock does not have preemptive rights.
As of January 31, 1996, 1,709,451 shares of Common Stock were issued and
outstanding. Of the remaining authorized but unissued shares, 151,896 shares
are reserved for issuance under the Corporation's stock option plans and an
additional 800,000 shares are reserved for issuance pursuant to the
Corporation's outstanding Cancellable Mandatory Stock Purchase Contracts
("Equity Contracts"), which presently require the purchase not later than
November 1, 1997 of approximately 465,549 shares of Common Stock at a price
of $10.74/share (as adjusted for stock dividends). The Board of Directors
therefore presently has authority only to issue up to 1,338,653 shares of
Common Stock without restriction.
The Capital Increase Amendment increases the Corporation's total authorized
stock to 11,000,000 shares, consisting of 10,000,000 shares of Common Stock
(increasing presently authorized Common Stock from 4,000,000 shares), and
1,000,000 shares of the Preferred Stock (no change in authorized Preferred
Stock will be made under the Capital Increase Amendment). The increased
shares of authorized Common Stock under the Capital Increase Amendment would
have all of the same characteristics as the presently authorized Common
Stock.
No shares of Preferred Stock have been issued. Under the terms of the
Corporation's Certificate of Incorporation, as amended, the Corporation's
Board of Directors may determine, without further shareholder approval, the
relative rights, preferences and limitations of the Preferred Stock
including, without limitation, stated value, dividend rights, rights to
convert such shares into shares of another class or series (such as Common
Stock or another class or series of Preferred Stock), voting rights,
liquidation preferences, redemption rights, division into classes and into
series within any class or classes, sinking fund provisions and similar
matters, and generally to determine all the characteristics of the Preferred
Stock other than the total number of such shares which the Board has
authority to issue. The availability of authorized but unissued Preferred
Stock with unspecified voting rights and possibly other rights, such as a
required approval of mergers or other extraordinary corporate transactions,
could be used by the Corporation's management to create voting impediments or
to frustrate persons seeking to effect a merger or otherwise to gain control
of the Corporation (for another provision which could also have an "anti-
takeover" effect, see "--Existing 'Anti-Takeover' Provisions" below).
REASONS FOR THE CAPITAL INCREASE AMENDMENT
The last increase in the Corporation's authorized stock was approved by the
shareholders in 1993. At that time the Board of Directors had authority to
issue 2,000,000 million shares of Common Stock, of which 656,865 shares were
issued and outstanding and 163,057 shares were reserved for issuance pursuant
to stock option plans. At the 1993 Annual Meeting the shareholders approved
an increase in authorized stock to the present 4,000,000 shares of Common
Stock and 1,000,000 shares of Preferred Stock. In the past three years the
number of shares of Common Stock outstanding has increased to 1,709,451
shares as a result of (i) three consecutive 10% stock dividends during 1993,
1994 and 1995, (ii) the acquisitions during 1995 of Family First Federal
Savings Bank and Bergen Commercial Bank, and (iii) exercises of stock
options. In addition, the number of shares of Common Stock reserved for
issuance has increased to 951,896,
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<PAGE>
primarily as a result of the issuance of Equity Contracts at the end of 1993
as well as the adjustment effect of stock dividends upon the number of shares
needed for issuance pursuant to both Equity Contracts and stock options.
Because the Board of Directors has authority to issue only 1,338,653 shares
of Common Stock without restriction, the Board recommends that the Capital
Increase Amendment be approved to assist in further business combinations, to
facilitate expansion of the Corporation's capital base, to permit continued
payment of stock dividends, and to facilitate the issuance of shares pursuant
to outstanding Equity Contracts as well as both existing and proposed stock
option plans, as discussed below.
BUSINESS COMBINATIONS. Although the Board does not presently contemplate
any specific business combination, the Board of Directors is continuously
seeking business combination opportunities for the Corporation. The Board
believes it is desirable for it to be able to take advantage of various
acquisition opportunities sought by the Corporation or which otherwise
present themselves. An increase in authority to issue Common Stock, coupled
with existing authority to issue Preferred Stock, will increase the Board's
flexibility to negotiate and consummate business combination transactions
which the Board views favorably.
EXPANSION OF CAPITAL BASE. Although the Board presently has no specific
plans to raise additional capital, the Board believes it is advantageous
generally for it to have the maximum flexibility to be able to raise capital
in the most beneficial way if and when the need arises. The Capital Increase
Amendment's additional authority to issue Common Stock, either for cash or in
connection with combinations with other businesses (see "--Business
Combinations" above), coupled with the existing authority to issue Preferred
Stock, should enhance that flexibility for the foreseeable future.
STOCK DIVIDENDS. The Corporation has paid stock dividends for many years.
Stock issued to fund stock dividends has been provided from authorized but
unissued shares. Although there can be no assurance that the Corporation
will continue to pay stock dividends in the future, such payments are
possible and the proposed increase in authorized stock will facilitate such
payments.
EQUITY CONTRACTS AND STOCK OPTION PLANS. The Corporation's outstanding
Equity Contracts require the issuance of Common Stock not later than November
1, 1997. At the present price, as adjusted for stock dividends, 465,549
shares of Common Stock will be required. In addition, the Corporation
maintains three stock option plans (see "PROPOSAL ONE--ELECTION OF DIRECTORS-
-Option Grants") and the Board of Directors has adopted two additional stock
option plans, subject to approval by the shareholders at the Annual Meeting
(see "PROPOSAL FOUR--APPROVAL OF GREAT FALLS BANCORP 1996 EMPLOYEE STOCK
OPTION PLAN" and "PROPOSAL FIVE--APPROVAL OF GREAT FALLS BANCORP 1996 STOCK
OPTION PLAN FOR NONEMPLOYEE DIRECTORS"). The number of shares needed to fund
the Equity Contracts and stock options will increase further in the event
future stock dividends are paid.
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<PAGE>
EFFECTS OF PROPOSED INCREASE IN AUTHORIZED COMMON STOCK
The principal effect of the Capital Increase Amendment is to increase the
authority of the Board of Directors, in its discretion and acting alone
without further approval by the shareholders, to issue more shares of Common
Stock than it presently has authority to issue. Such shares may be issued
for the purposes discussed above.
Another possible effect of the Capital Increase Amendment could be to
render the accomplishment of a tender offer or other takeover attempt
("takeover") more difficult. Although the Board did not adopt the Capital
Increase Amendment for such a reason, the Capital Increase Amendment could
have that effect by enabling the Board to issue Common Stock to one or more
persons other than takeover bidders. The Board believes approval of the
Capital Increase Amendment could thus encourage potential takeover bidders to
seek approval of the Board through negotiation with the Board rather than, or
at least prior to, attempting a "hostile" takeover. Because negotiation at
an early stage would thus be encouraged, the Board would have a better
opportunity to analyze any prospective offers, negotiate more favorable
terms, if appropriate, and make a considered recommendation to shareholders
as to the benefits and detriments of the offer.
Since approval of the Capital Increase Amendment could render more
difficult an attempt to gain voting control of the Corporation, it arguably
could also tend to perpetuate incumbent management.
EXISTING "ANTI-TAKEOVER" PROVISIONS
The Corporation's Certificate of Incorporation provides for a staggered
Board of Directors consisting of three classes, each of which is elected for
a three-year term (see "PROPOSAL ONE--ELECTION OF DIRECTORS"). Such a
provision could be said to have an "anti-takeover" effect by preventing a
change of control of the Board at one annual meeting of shareholders. In
addition, the Corporation's Bylaw relating to nominations of candidates to be
elected as directors, and the Bylaw enabling the Board to increase the number
of directors by two members and to fill the vacancies so created (see
"PROPOSAL ONE--ELECTION OF DIRECTORS"), could be viewed as having an anti-
takeover effect. Except for such provisions, the Corporation's Certificate
of Incorporation or Bylaws do not contain other provisions having an anti-
takeover effect.
The Capital Increase Amendment is not a part of a present plan by
management to adopt a series of anti-takeover measures and the Board of
Directors does not presently know of any other specific measures having an
anti-takeover effect which it will propose in future proxy solicitations. On
the other hand, the Board may in the future propose additional measures which
do have such an effect if the Board deems such measures to be in the best
interests of the Corporation and its shareholders.
Cumulative voting for directors is not provided for in the Corporation's
Certificate of Incorporation or Bylaws, nor is such voting required by New
Jersey law unless the Certificate of Incorporation so provides.
BOARD RECOMMENDATION
Shareholders should carefully consider the advantages and disadvantages of
the Capital Increase Amendment in deciding whether to vote for its approval.
The Board has unanimously concluded that the potential benefits of the
Capital Increase Amendment far outweigh potential disadvantages because such
amendment provides the Board with flexibility it believes it needs for
possible use in connection with funding business combinations, future
financing, stock dividends and Equity Contracts and stock options. With
respect to possible takeover situations, although this is not one of the
Board's reasons for adopting the Capital Increase Amendment, the Capital
Increase Amendment does have the potential effect of enhancing the Board's
discretion to protect the Corporation and its shareholders from certain
undesirable takeover attempts and strengthening the Board's ability to
negotiate business combinations which the Board views as being consistent
with its long-term goals for the Corporation.
All members of the Board of Directors intend to vote their shares of Common
Stock in favor of approval of the Capital Increase Amendment (see table of
beneficial ownership above under "PROPOSAL ONE--ELECTION OF DIRECTORS--
Security Ownership of Management"). Since approval of the Capital Increase
Amendment could arguably be used to perpetuate incumbent management, the
Board arguably has a conflict
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<PAGE>
of interest in recommending its approval. However, the Board believes this
is inherently the case with any proposal which enhances the Board's
discretion. The Board therefore believes this is basically a question of the
degree of confidence which shareholders have in the directors to exercise
their judgment in any particular case and to discharge their duty to use any
such discretion in a way which is in the best interests of the Corporation
and its shareholders.
The foregoing description of potential consequences of the Capital Increase
Amendment is based upon the beliefs of the Board of Directors. Consequences
of approval of the Capital Increase Amendment may be affected by subsequent
events and particular factual circumstances so that the actual consequences
may differ from those described above.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR APPROVAL OF THE AMENDMENT TO THE CERTIFICATE OF INCORPORATION AUTHORIZING
ADDITIONAL COMMON STOCK OF THE CORPORATION.
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PROPOSAL FOUR
APPROVAL OF GREAT FALLS BANCORP
1996 EMPLOYEE STOCK OPTION PLAN
GENERAL
On February 20, 1996, the Corporation's Board of Directors unanimously
adopted the Great Falls Bancorp 1996 Employee Stock Option Plan (the
"Employee Plan"), subject to the approval of the Corporation's shareholders.
The Employee Plan provides for the granting of incentive stock options
(ISOs), nonqualified stock options (NQSOs) and stock appreciation rights
(SARs) to employees (including officers who are employees) of the Corporation
and its subsidiaries. A Stock Appreciation Right (SAR) is a contractual
right to receive, either in cash or stock, the appreciation in the value of a
certain number of shares of stock over a specified period of time. The
economic value of an exercisable SAR is measurable by the difference between
the option price and the fair market value of the number of shares of Common
Stock subject to the SAR. To facilitate a Participant's financial ability to
exercise stock options and, in the case of an NQSO, to pay income taxes
attributable to the exercise of an option, SARs may be granted in tandem with
stock options (Tandem SARs) or separately from stock options (Non-Tandem
SARs). The Plan also provides discretionary authority for loans to
Participants in connection with their exercise of options. The maximum
number of shares of Common Stock and Non-Tandem SARs that may be made subject
to options granted pursuant to the Employee Plan is 200,000.
Adoption of the Employee Plan is subject to approval by affirmative vote of
the holders of a majority of the outstanding shares of Common Stock present
or represented, and entitled to vote, at a meeting of the Corporation's
shareholders duly held in accordance with New Jersey laws. A copy of the
Employee Plan is attached to this Proxy Statement as Appendix A and the
following description is qualified in its entirety by reference to the
Employee Plan.
PURPOSES
The purposes of the Employee Plan are to attract and retain highly-
qualified employees, to align employee and stockholder long-term interests by
creating a direct link between employee compensation and stockholder return,
to enable employees of the Corporation and its subsidiaries to develop and
maintain stock ownership positions in the Corporation, and to provide
incentives to such employees to contribute to the Corporation's success.
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ADMINISTRATION
The Employee Plan will be administered by a committee (the "Committee") of
the Board of Directors which shall consist of all members of the Board who
qualify as both "disinterested persons" for purposes of the rules promulgated
under Section 16(b) of the Securities Exchange Act of 1934 (the "Exchange
Act") and "outside directors" within the meaning of Section 162(m) of the
Internal Revenue Code of 1986, as amended. Directors who are eligible to be
granted options under the Employee Plan are not eligible to serve on the
Committee. The following members of the Board of Directors serve on the
Committee: M.A. Bramante, Robert J. Conklin, William T. Ferguson, Joseph A.
Lobosco, Alfred R. Urbano, and Charles J. Volpe.
Subject to the provisions of the Employee Plan, the Committee is authorized
(i) to determine which eligible employees of the Corporation or its
subsidiaries shall be granted options and/or SARs, (ii) to grant options
and/or SARs, (iii) to determine the times when options and/or SARs may be
granted and the number of shares that may be purchased pursuant to such
options and/or the number of shares associated with SARs, (iv) to determine
the exercise price of the shares subject to each option, (v) to determine the
time or times when each option and/or SAR becomes exercisable, the duration
of the exercise period, and any other restrictions on exercise, (vi) to
prescribe the form or forms of agreements relating to options or SARs, (vii)
to determine the circumstances under which the time for exercising options
and/or SARs should be accelerated and to accelerate the time for exercising
outstanding options and/or SARs, (viii) to determine the duration and
purposes of leaves of absence which may be granted to a participant without
constituting a termination of service for purposes of the plan, (ix) to
adopt, amend and rescind rules and regulations for the administration of the
plan, and (x) to construe and interpret the plan, the rules and regulations
and option and SAR agreements under the plan, and to make all other
determinations deemed necessary or advisable in the administration of the
plan.
The Committee may delegate to any person or persons (a "Subcommittee") all
or any part of its authority with respect to eligible employees of the
Corporation or its subsidiaries who are not "officers" of the Corporation
within the meaning of Section 16(b) of the Exchange Act.
ELIGIBILITY FOR AWARD OF OPTIONS
All employees of the Corporation and its subsidiaries (presently,
approximately 130 persons), including officers, are eligible to receive
options and/or SARs under the Employee Plan. Nonemployee directors are not
eligible to participate in the Employee Plan.
GRANT OF OPTIONS
The Committee may in its sole discretion grant options and/or SARs to such
employees of the Corporation and its subsidiaries as it determines
appropriate.
The Committee has granted to each of Mr. Campbell and Mr. Irwin NQSOs to
purchase 40,000 shares under the Employee Plan, subject to shareholder
approval of the Employee Plan. See "--Proposed Employee Plan Benefits."
CONSIDERATION
No consideration is to be paid to the Corporation by a Participant in the
Employee Plan in exchange for the grant of an option and/or SAR to such
employee.
UNDERLYING SECURITIES; MARKET VALUE
The Employee Plan provides for the issuance of options to purchase shares
of Common Stock and/or SARs. The maximum number of shares that may be made
subject to options and Non-Tandem SARs granted pursuant to the Employee Plan
is 200,000, which represents approximately 11.7% of the Corporation's Common
Stock outstanding on the date of this Proxy Statement (unadjusted for
approximately 465,000 shares stock issuable upon exercise of the Equity
Contracts and other shares issuable upon exercise of outstanding stock
options). Based upon the mean between the closing bid and asked prices of
the Common
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Stock on February 20, 1996, in the amount of $16.875 per share, as quoted by
Ryan, Beck & Co., Inc., the total value of the stock called for by the total
number of options and Non-Tandem SARs eligible to be granted under the
Employee Plan is $3,375,000.
TERMS AND CONDITIONS OF EMPLOYEE OPTIONS AND SARS
The Committee is authorized to establish the terms which will govern each
option and/or SAR granted under the Employee Plan, provided that such terms
are consistent with the terms and conditions of the Employee Plan. Options
and/or SARs shall be evidenced by option and/or SAR agreements in such forms
as the Committee may from time to time approve. There is no obligation to
grant any two options and/or SARs on the same terms.
Minimum Exercise Price. The exercise price per share for options and/or
-----------------------
SARs granted under the Employee Plan shall be not less than the fair market
value of a share of Common Stock on the date of grant. If, as is currently
the case, on the date of grant the Common Stock is not admitted to quotation
on any securities exchange or the National Association of Securities Dealers
Automated Quotation System ("NASDAQ") or other comparable quotation system,
fair market value on the date of grant is defined as the mean between the
closing bid and asked prices for the Common Stock, as quoted by Ryan, Beck &
Co., Inc., a principal market maker for transactions in the Common Stock on
the over-the-counter market, or other market maker designated by the
Committee or the Board of Directors.
Exercisability and Terms of Options. No option and/or SAR may be
-----------------------------------
exercisable within six months of the date it is granted, other than in the
event of acceleration due to death, disability or a "Change in Control" (see
"Terms and Conditions of Employee Options and SARs--Accelerated Vesting and
Exercise" below). ISOs shall not have a term of more than ten years from the
date of grant. Upon the termination of a Participant's service due to
voluntary resignation, involuntary dismissal without "cause" or retirement,
options and/or SARs that have not become exercisable before the date the
Participant terminates service shall be forfeited and terminated immediately.
A participant may exercise an option and/or SAR to the extent it was
exercisable on the date immediately preceding such termination within the
lesser of (i) one month from the date of termination (six months from the
date of termination in the case of retirement), or (ii) the balance of the
stated term of the option and/or SAR. If a participant's employment is
terminated for "cause," all options and/or SARs granted to such participant
that have not been exercised prior to such termination for cause shall,
whether or not exercisable, be forfeited immediately upon such termination.
"Cause" means (i) conviction of a felony, (ii) indictment for embezzlement or
misappropriation of funds of, or any act of dishonesty towards, the
Corporation, (iii) written confession of embezzlement or misappropriation of
funds of, or any act of dishonesty towards, the Corporation, or (iv) willful
or gross neglect of duties, all as the Committee may determine in its
discretion.
Accelerated Vesting and Exercise. If a participant's employment terminates
--------------------------------
due to death or disability, all options and/or SARs granted to such
participant that have not become exercisable on or before the date of such
termination shall immediately become fully vested and exercisable. All
options and/or SARs held by such participant may be exercised by the
participant, his estate or beneficiary, or his representative, as the case
may be, for a period of one year from the date of such termination, or until
the expiration of the stated term of such option, whichever period is
shorter.
Any option granted under the Employee Plan to a participant which has not
become exercisable as of the date of a Change in Control of the Corporation
shall become fully exercisable as of that date. A "Change in Control" means
the occurrence of one or more of the following events: (i) the Corporation
acquires actual knowledge that any person (other than the Corporation or a
subsidiary) is or becomes the beneficial owner of securities representing
more than 25% of the combined voting power of the Corporation's then
outstanding securities; (ii) the first purchase of Common Stock pursuant to a
tender or exchange offer (other than an offer by the Corporation or a
subsidiary); (iii) approval by the Corporation's shareholders of (x) a merger
or consolidation of the Corporation with or into another corporation (unless
the Corporation is the surviving corporation and the merger or consolidation
does not result in any reclassification or reorganization of the outstanding
Common Stock of the Corporation and does not result in a change in the
Corporation's directors other than the addition of up to three directors),
(y) a disposition of all or substantially all of the Corporation's assets, or
(z) a plan of liquidation or dissolution; (iv) a turnover of at least 1/3 of
the directors during any period of 2 consecutive calendar years unless the
election or nomination of each new director was
20
<PAGE>
approved by a vote of at least 2/3 of the directors then still in office who
were directors at the beginning of such 2-year period; or (v) a sale of
Common Stock if after such sale any person (other than the Corporation or a
subsidiary) owns a majority of the Common Stock or a sale of all or
substantially all of the Corporation's assets.
Nontransferability. No option or SAR shall be transferable except by will
------------------
or the laws of descent and distribution. During the lifetime of the
Participant, options and/or SARs shall be exercisable only by the
Participant. However, the Board may allow for transfers to family members of
NQSOs, Non-Tandem SARs, and Tandem SARs issued in connection with NQSOs,
subject to such conditions or limitations as it may establish to ensure
compliance with Securities and Exchange Commission Rule 16b-3 or for other
purposes.
Special Provisions Applicable to ISOs. To the extent the aggregate fair
-------------------------------------
market value (determined as of the time the option is granted) of the stock
with respect to which any options which are intended to be ISOs may be
exercisable for the first time by the Participant in any calendar year
exceeds $100,000, such options shall not be considered ISOs.
No ISO may be granted to an individual who, at the time the Option is
granted, owns directly or indirectly stock possessing more than 10% of the
total combined voting power of all classes of stock of the Corporation,
unless such option (i) has an exercise price of at least 110% of the fair
market value of the Common Stock on the date of the grant of such option, and
(ii) cannot be exercised more than 5 years after the date of grant.
Each participant who receives an ISO must agree to notify the Corporation
in writing immediately after the participant makes a "disqualifying
disposition" of any Common Stock acquired pursuant to the exercise of an ISO.
A disqualifying disposition is any disposition (including any sale) of such
Common Stock before the later of (i) 2 years after the date the optionee was
granted the ISO or (ii) 1 year after the date the participant acquired Common
Stock by exercising the ISO.
Any other provision of the Employee Plan to the contrary notwithstanding,
no ISO or Tandem SAR granted in conjunction with an ISO shall be granted
after the date which is 10 years from the date the Plan was adopted by the
Board of Directors of the Corporation (February 20, 1996).
EXERCISE OF OPTIONS
Options which have become exercisable may be exercised in whole or in part,
provided that each partial exercise must be for whole shares only. Options
may only be exercised by delivery to the Secretary or his office of written
notice of exercise signed by the Participant (or other person then entitled
to exercise such option), full payment for the purchased shares,
representations and warranties as necessary or advisable to comply with all
applicable securities laws, and full payment of all amounts legally required
to be withheld upon exercise of the option. If the option is being exercised
by a person other than the participant, appropriate proof that such person
has the right to exercise the option must also be furnished.
PAYMENT FOR SHARES
Payment for shares purchased by exercising options under the Employee Plan
shall be made by (i) certified or bank cashier's check or, unless prohibited
by the terms of the applicable option agreement, (ii) unrestricted shares
previously owned by the participant based on the fair market value of such
Common Stock on the date the option is exercised, (iii) a combination of
certified or bank cashier's check and previously owned shares, or (iv) any
other means acceptable to the Corporation. To the extent the exercise price
is paid by delivery of previously owned shares, (i) shares received by the
participant upon exercise of ISOs may only be used if the participant has
held such shares for at least the greater of 2 years from the date the ISOs
were granted or 1 year from the date the shares were transferred to the
participant, and (ii) shares received by the participant upon exercise of
NQSOs may only be used if such shares have been held by the Participant for
at least 6 months.
The Corporation may make loans to such participants as the Committee, in
its discretion, may determine in connection with the exercise of options
granted under the Employee Plan.
21
<PAGE>
The proceeds received by the Corporation from the sale of Common Stock
pursuant to the Employee Plan shall be used for general corporate purposes.
22
<PAGE>
EXERCISE OF SARS
As noted above, a Stock Appreciation Right (SAR) is a right to receive cash
or Common Stock measurable by the difference between the option price and the
fair market value of the number of shares of Common Stock subject to the SAR.
Upon exercise of the SAR, that difference may be paid to the holder of the
SAR in cash, in Common Stock (valued at its fair market value at the time of
the SAR is exercised), or a combination of cash and Common Stock, as set
forth in the agreement describing the SAR granted to a particular
participant.
A Tandem SAR may only be exercised to the extent a related option is
exercisable. Upon exercise of a Tandem SAR, the number of shares subject to
the related option is reduced.
ADJUSTMENTS FOR RECAPITALIZATIONS, ETC.
The aggregate number of shares of Common Stock which may be purchased
pursuant to options or SARs under the Employee Plan, the number of shares
covered by outstanding options or SARs, and the price per share of
outstanding options or SARs, shall each be appropriately adjusted for (i) any
increase or decrease in the number of outstanding shares of Common Stock
resulting from a stock split or other subdivision or consolidation of such
shares, (ii) other capital adjustments, stock dividends or stock
distributions, (iii) other increases or decreases in outstanding shares
effected without receipt of consideration by the Corporation, or (iv) a
reorganization, merger or consolidation, or other similar change affecting
the Common Stock (collectively referred to herein as "Recapitalizations").
Options and SARs shall be adjusted so that the total price applicable to the
unexercised portion of the option or SAR shall be unchanged (except for
changes resulting from rounding). No fractional shares shall be issued as a
result of such adjustment.
In the event of a transaction involving the Corporation's liquidation or
dissolution, a merger or consolidation in which the Corporation is not the
surviving corporation, or the sale or disposition of all or substantially all
of the Corporation's assets, provision shall be made in connection with such
transaction for the assumption of options and SARs previously granted under
the Employee Plan or the substitution of new options and SARs of the
successor corporation (with appropriate adjustments), or, in the discretion
of the Committee, the Employee Plan and any options and SARs granted
thereunder shall terminate on the effective date of such transaction if
appropriate provision is made for payment to Participants of the difference
between the market value of the shares covered by their outstanding options
and SARs and the exercise price for such options and SARs. However, the
Committee shall do nothing which would prevent any such merger, acquisition
or sale of assets from being treated as a pooling of interests.
REGISTRATION OF SHARES
The Corporation intends to register the Common Stock to be issued upon
exercise of options or SARs granted pursuant to the Employee Plan under
applicable federal and state securities laws, but shall have no obligation to
so register such shares or to maintain in effect any such registration.
Unless a registration statement under the Securities Act of 1933 is then in
effect, the Corporation shall require that the offer and sale of shares
covered by such options and SARs shall be exempt from registration; in
furtherance of the foregoing, if a registration statement is not then in
effect, the Corporation may require as a condition precedent to the exercise
of any option or SAR that the optionholder make certain representations and
undertakings to the Corporation, and the Corporation shall place an
appropriate legend on certificates representing any shares issued upon
exercise of such options or SARs regarding restrictions on disposition of
such shares. The Corporation shall not be required to issue or deliver any
certificates for such shares prior to the completion of any required
registration or other qualification of such shares and receipt of any
approval or other clearance from any governmental agency which may be
necessary or advisable.
EFFECTIVE DATE AND EXPIRATION DATE
The Employee Plan shall be effective as of the date it is approved by the
affirmative vote of the holders of a majority of the Shares present, in
person or by proxy, and entitled to vote at a meeting of the Corporation's
shareholders. No ISO or Tandem SAR granted in tandem with an ISO may be
granted under the Employee Plan more than ten years after the Plan was
adopted by the Board of Directors, and no ISO or
23
<PAGE>
Tandem SAR granted in tandem with an ISO may have a term which is more than
ten years after it has been granted. There is no limit upon either the time
within which the Committee must grant, or the term of, NQSOs, Tandem SARs
granted in tandem with NQSOs, or Non-Tandem SARs.
AMENDMENTS AND TERMINATION
Subject to the limitations described below, the Board of Directors may
amend or terminate the Employee Plan. No such action shall adversely affect
options and/or SARs which are then outstanding without the consent of the
option/SAR holder. The Board may not, without approval of the shareholders,
(i) materially increase the total number of shares which may be purchased or
acquired pursuant to options and SARs granted under the Employee Plan (except
for adjustments to reflect recapitalizations, stock splits, stock dividends,
etc.), (ii) expand the class of employees eligible to receive options and
SARs, (iii) decrease the minimum option exercise price, (iv) extend the
maximum term of options and/or SARs granted under the plan, (v) extend the
term of the plan, or (vi) take any other action requiring shareholder
approval under Rule 16b-3 under the Securities Exchange Act of 1934.
COMPLIANCE WITH SEC RULE 16b-3
The Employee Plan is intended to comply with Rule 16b-3 under the
Securities Exchange Act of 1934. Any provisions inconsistent with such Rule
shall be inoperative.
FEDERAL INCOME TAX CONSEQUENCES
The following is a brief summary of certain federal income tax consequences
to Participants in the Employee Plan and the Corporation based on federal
income tax laws in effect on January 1, 1996. This summary is not intended
to be complete and does not describe any state, local or foreign tax
consequences.
NNQSOs. A Participant who is granted a NQSO under the Employee Plan will
------
not realize income upon the grant of the option. A Participant will normally
realize ordinary income at the time of exercise equal to the excess of the
fair market value at such time of the shares purchased over the exercise
price for such shares (the "Spread"). The time of realization of income
could, however, be deferred for up to six months if the option holder could
be subject to suit under Section 16(b) of the 1934 Act. The Corporation will
be entitled to a corresponding income tax deduction for federal income tax
purposes equal to the Spread during the taxable year in which the Participant
realizes income, provided applicable withholding and/or tax reporting
requirements are met. Upon the sale of stock received pursuant to the
exercise of a NQSO, the Participant will realize either gain or loss measured
by the difference between the amount realized from the sale and the
Participant's basis in the shares for income tax purposes. Such basis
generally will equal the fair market value of the shares at the date of
exercise.
If the Participant uses previously-owned stock to exercise a NQSO, a number
of shares received equal to the number of shares delivered to exercise the
NQSO will have the same basis as the shares delivered. The Participant will
realize ordinary income equal to the fair market value of shares received in
excess of the number of shares used to exercise the NQSO. Gain or loss from
the sale of such stock will be considered gain or loss from the sale of a
capital asset if the shares are held for investment purposes. Losses from
sales of capital assets may be subject to limitations based upon the amount
and nature of the Participant's other income, deductions, gains and losses.
ISOs. A Participant generally will not realize income at the time of
----
either grant or exercise of an ISO. However, as explained below, a
Participant may incur alternative minimum tax (AMT) consequences upon the
exercise of an ISO. Upon the sale of stock received pursuant to the exercise
of an ISO, other than a sale of stock which is a "disqualifying disposition,"
as defined below, the Participant will recognize either a gain or loss
measured by the difference between the amount realized from the sale and the
Participant's basis in the shares. The basis in shares received upon
exercise of an ISO will generally be the exercise price of those shares.
However, if the Participant uses previously owned stock to exercise an ISO,
the number of shares received which equal the number of shares delivered to
exercise the ISO will have the same basis as the shares delivered; shares
received in excess of the number of shares used to exercise the option will
have a basis equal to any cash paid on exercise.
24
<PAGE>
Gain or loss from the sale of stock received upon exercise of an ISO, other
than a sale of stock which is a "disqualifying disposition," as defined
below, will be considered gain or loss from the sale of a capital asset if
the shares are held for investment purposes. Losses from sales of capital
assets may be subject to limitations based upon the amount and nature of the
Participant's other income, deductions, gains and losses.
A "disqualifying disposition" of shares received pursuant to the exercise
of an ISO occurs if the Participant disposes of such shares within two years
from the date of the grant of the option or within one year after the
transfer of the shares to the Participant, unless such disposition is (i) a
transfer from a decedent to an estate or a transfer by bequest or
inheritance, (ii) an exchange to which Section 354, Section 355, Section 356
or Section 1036 (or so much of Section 1031 as relates to Section 1036) of
the Internal Revenue Code applies, or (iii) a mere pledge or hypothecation.
In the event of a "disqualifying disposition," the Participant generally will
realize ordinary income in the year of the "disqualifying disposition" in an
amount equal to the difference between the fair market value of the shares on
the date of exercise and the exercise price. If the amount realized on the
disqualifying disposition is less than the fair market value of the shares on
the date of exercise, the amount realized as ordinary income is limited to
the amount by which the amount realized on the sale of the shares in the
"disqualifying disposition" exceeds the exercise price. If the amount
realized from the disqualifying disposition exceeds the fair market value of
the shares on the date of exercise, the excess amount realized will be
treated as additional gain taxed under the rules described in the preceding
paragraph.
The Corporation does not realize any Federal income tax consequences on the
issuance or exercise of ISOs. If the Participant makes a "disqualifying
disposition," however, the Corporation may deduct an amount equal to the
amount included in the Participant's ordinary income, in the year in which
the Participant realizes such income.
If the stock received upon exercise of an ISO is freely transferable or not
subject to a substantial risk of forfeiture, then the excess, if any, of the
fair market value of such stock (determined without regard to any restriction
other than a restriction which by its term will never lapse) over the amount
paid for such stock is included in the determination of the Participant's
alternative minimum taxable income (AMTI) in the year of exercise. If the
stock received pursuant to the exercise of an ISO is not freely transferable
and is subject to a substantial risk of forfeiture, then the excess, if any,
of the fair market value of such stock (determined as above) at the time such
stock becomes freely transferable or no longer is subject to a substantial
risk of forfeiture, whichever of said two events occurs first, over the
amount paid for such stock is included in the determination of the
Participant's AMTI in the year in which such stock becomes freely
transferable or is no longer subject to a substantial risk of forfeiture,
whichever of said two events occurs first. Special rules apply for purposes
of determining whether stock received pursuant to the exercise of an ISO is
freely transferable or subject to a substantial risk of forfeiture.
For purposes of computing the AMT in the year of sale, the basis in the
shares sold is increased by the amount included in the determination of AMTI
in the year the option was exercised. If stock received pursuant to the
exercise of an ISO is sold in the same taxable year in which the option was
exercised, then the amount includible in the determination of the
Participant's AMTI cannot exceed the excess (if any) of the amount realized
on the sale less the Participant's adjusted basis in such stock.
SARs. No taxable event occurs upon the grant of an SAR. A Participant is
----
taxable on the "Spread" upon exercise of an SAR, and the Corporation is
entitled to a deduction in the same amount during the year of exercise. The
time of realization of income could, however, be deferred for up to six
months if the option holder could be subject to suit under Section 16(b) of
the 1934 Act. The Spread is treated as "wages" for employment tax and wage
withholding purposes. These tax results are the same whether the Participant
elects to receive the benefit of the Spread in cash or Common Stock.
PROPOSED EMPLOYEE PLAN BENEFITS
On February 20, 1996, the Committee granted options under the Employee Plan
to the two employees identified in the following table. Such option grants
are subject to approval of the Employee Plan by the Corporation's
shareholders at the Annual Meeting.
25
<PAGE>
<TABLE>
<CAPTION>
Name and Positions Number of Options
- ----------------------------------------------------------------------------
<S> <C>
George E. Irwin 40,000
President and Chief Executive Officer of Great Falls
Bank; President and Chief Operating Officer of
Great Falls Bancorp
C. Mark Campbell 40,000
President and Chief Executive Officer of Bergen
Commercial Bank; Executive Vice President of Great
Falls Bancorp
All current executive officers of the Corporation as a 80,000
group
All current directors of the Corporation who are not 0
executive officers as a group
All other employees as a group 0
</TABLE>
The indicated options are all NQSOs, and no SARs were granted. The above
options are exercisable at a price of $16.875 per share, which was the mean
between the bid and asked prices for the Common Stock on the date of grant,
as quoted by Ryan, Beck & Co.
The options described above will become "vested" at the rate of 20% per
year, or 8,000 shares, for each of the above optionees commencing on date of
grant (February 20, 1996) and each January 1 thereafter (commencing with
January 1, 1997) provided the optionee remains employed by the Corporation or
an affiliate of the Corporation, and each group of vested options will
thereafter become exercisable at the rate of 20% per year commencing January
1st after each vesting date (the first 20% of the first group of options
which vested on February 20, 1996 thereby becoming exercisable to the extent
of 20% on January 1, 1997). All such options will lapse on December 31,
2006, subject to earlier lapsing in the event of a termination of the
optionee's employment (except in certain circumstances), and subject to
possible deferral of exercisability if needed in certain circumstances to
preserve the Corporation's income tax deduction for the compensation element
realized upon exercise. Such options will also generally lapse when an
option holder is no longer employed by the Corporation or an affiliate of the
Corporation.
The exercisability of such options will be accelerated in the event of the
death or disability of the optionee, or in the event of a "Change in Control"
as defined in the Employee Plan. (See "--Terms and Conditions of Employee
Options and SARs--Accelerated Vesting and Exercise.") The option price may
be paid in cash, in previously owned Common Stock (valued at the fair market
value of the stock at the time of exercise), or in a combination of cash and
Common Stock.
At the request of an optionee, the Corporation may make loans to such
employees in connection with their exercise of the options on such terms and
conditions as the Committee may determine at the time of exercise, provided
that any such loan will be secured by Common Stock and/or other collateral
having a value at least equal to the amount of the loan, the interest rate
and other terms of repayment cannot be below market rates or otherwise more
favorable to the optionee than comparable loans by the Corporation's bank
subsidiaries to unrelated customers, and other terms of the Employee Plan and
applicable law must be complied with.
EFFECT OF ADOPTION OF 1996 EMPLOYEE PLAN ON 1988 PLAN
Approval of the 1996 Employee Plan will result in a termination of the 1998
Plan, with the result that no further options may be granted to employees
under the 1988 Plan and shares previously reserved for issuance pursuant to
the exercise of options not yet granted under the 1988 Plan shall no longer
be reserved. However, the termination of the 1988 Plan will not terminate or
otherwise affect the validity or enforceability of presently outstanding
options previously granted to employees under the 1988 Plan or shares
reserved for issuance upon the exercise of such outstanding options under the
1988 Plan.
26
<PAGE>
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR APPROVAL OF THE GREAT FALLS BANCORP 1996 EMPLOYEE STOCK OPTION PLAN.
27
<PAGE>
PROPOSAL FIVE
APPROVAL OF GREAT FALLS BANCORP
1996 STOCK OPTION PLAN FOR NONEMPLOYEE DIRECTORS
GENERAL
On February 20, 1996, the Corporation's Board of Directors unanimously
adopted the Great Falls Bancorp 1996 Stock Option Plan for Nonemployee
Directors (the "Director Plan"), subject to approval by the Corporation's
shareholders.
The Director Plan provides for the granting of nonqualified stock options
to nonemployee directors of the Corporation's bank subsidiaries, Great Falls
Bank and Bergen Commercial Bank (the "Banks"), to purchase a maximum of
95,000 shares of the Corporation's Common Stock.
Adoption of the Director Plan is subject to approval by affirmative vote
of the holders of a majority of the outstanding shares of Common Stock of the
Corporation present, in person or by proxy, and entitled to vote, at a
meeting of the Corporation's shareholders duly held in accordance with New
Jersey laws. A copy of the Director Plan is attached to this Proxy Statement
as Appendix B and the following description is qualified in its entirety by
reference to the Director Plan.
PURPOSES
The purposes of the Director Plan are to attract and retain highly-
qualified nonemployee directors of the Corporation's bank subsidiaries, to
align such nonemployee directors' and stockholders' long-term interests by
creating a direct link between compensation and shareholder return, to enable
such nonemployee directors to develop and maintain stock ownership positions
in the Corporation, and to provide incentives to such nonemployee directors
to contribute to the Corporation's success.
The Banks pay their directors fees for attending meetings of the Banks'
Boards and Board committees, and many (but not all) of the nonemployee
directors of Great Falls Bank were granted options to purchase Common Stock
under the Corporation's 1993 and 1995 Stock Option Plans, which were
previously approved by the Corporation's shareholders (see above, "PROPOSAL
ONE--ELECTION OF DIRECTORS--Executive Compensation and Other Benefits--
Directors' Compensation"). However, all of the options originally authorized
under the 1993 and 1995 Plans were granted during 1993 and 1995, and the
nonemployee directors of the Banks are excluded from eligibility to
participate in the Corporation's other existing stock option plans, namely,
the 1988 Nonstatutory Stock Option Plan and the proposed Employee Plan (see
"PROPOSAL FOUR--APPROVAL OF GREAT FALLS BANCORP 1996 EMPLOYEE STOCK OPTION
PLAN"). The proposed Director Plan is thus intended to complement the stock
option plans for employees.
ADMINISTRATION
The Director Plan will be administered by the Corporation's Board of
Directors. Subject to the provisions of the Director Plan, the Board is
authorized to grant options under the Plan on the terms specified below,
establish rules and regulations under the Plan, and construe and interpret
the Plan.
ELIGIBILITY FOR AWARD OF OPTIONS
Those eligible to be granted options under the Director Plan
("Participants") are the sixteen individuals who were the nonemployee
directors of the Banks on February 20, 1996. Ten were directors of Great
Falls Bank and six were directors of Bergen Commercial Bank. All of the
Corporation's present directors other than Messrs. Campbell and Irwin are
included in this group of Participants, which includes four of the nominees
for reelection at the Annual Meeting as directors, namely, Messrs. Bruno,
Lobosco, Soldoveri and Volpe. For information about the Corporation's
directors, see "PROPOSAL ONE--ELECTION OF DIRECTORS".
28
<PAGE>
GRANT OF OPTIONS
Following adoption of the Director Plan on February 20, 1996, the Board of
Directors granted options to purchase all of the 95,000 shares covered by the
Director Plan to the nonemployee directors of Great Falls Bank and Bergen
Commercial Bank. Such options will not be effective unless and until the
Corporation's shareholders approve the Director Plan at the Annual Meeting.
See "--Proposed Director Plan Benefits."
CONSIDERATION
No consideration is to be paid to the Corporation by a Participant in the
Director Plan in exchange for the grant of an option to such Participant.
UNDERLYING SECURITIES; MARKET VALUE
The aggregate number of shares which may be issued pursuant to the
exercise of options granted under the Director Plan is 95,000 shares, which
represents approximately 5.6% of the Corporation's Common Stock outstanding
on the date of this Proxy Statement (unadjusted for approximately 465,000
shares stock issuable upon exercise of the Equity Contracts and other shares
issuable upon exercise of outstanding stock options). Based upon the mean
between the closing bid and asked prices of the Common Stock on February 20,
1996, in the amount of $16.875 per share, as quoted by Ryan, Beck & Co., the
total value of the stock called for by the total number of options eligible
to be granted under the Director Plan is $1,603,125.
TERMS AND CONDITIONS OF DIRECTOR OPTIONS
The Director Plan provides for the grant of options to purchase a total of
3,000 shares to each eligible participant other than Anthony M. Bruno, Jr.,
and for the grant of options to purchase a total of 50,000 shares to Mr.
Bruno. All options granted under the Director Plan will become "vested" at
the rate of 20% per year (600 shares for each of the nonemployee directors
other than Mr. Bruno; 10,000 shares for Mr. Bruno) commencing on the date of
grant and each January 1 thereafter provided the optionee remains a director
of or employed by the Corporation or an affiliate of the Corporation, and
each group of vested options will thereafter become exercisable at the rate
of 20% per year commencing January 1st after each vesting date. All such
options will lapse on December 31, 2006, subject to possible deferral of
exercisability if needed in certain circumstances to preserve the
Corporation's income tax deduction for the compensation element realized upon
exercise. Such options will also generally lapse when an option holder is no
longer a director or employee of the Corporation or an affiliate of the
Corporation. However, in the event of an option holder's death or permanent
disability, the Director Plan provides that the period of exercisability may
be extended for up to one year, but not later than December 31, 2006. An
option holder may not transfer an option other than by Will or the laws of
descent and distribution.
EXERCISE OF OPTIONS
Options which have become exercisable under the Director Plan may be
exercised in whole or in part. Fractional shares will not be issued.
Options shall be exercised by delivery to the Secretary or his office of
written notice of exercise signed by the Participant (or other person then
entitled to exercise such option), full payment for the purchased shares,
representations and warranties as necessary or advisable to comply with all
applicable securities laws, and full payment of any amounts legally required
to be withheld upon exercise of the option. If the option is being exercised
by a person other than the Participant, appropriate proof that such person
has the right to exercise the option must also be furnished.
Any option granted under the Director Plan to a participant which has not
become exercisable as of the date of a Change in Control of the Corporation
shall become fully exercisable as of that date. "Change in Control" has the
same meaning in the Director Plan as in the Employee Plan. See "PROPOSAL
FOUR--APPROVAL OF GREAT FALLS BANCORP 1996 EMPLOYEE STOCK OPTION PLAN--Terms
and Conditions of Employee Options and SARs--Accelerated Vesting and
Exercise".
29
<PAGE>
PAYMENT FOR SHARES
Common Stock purchased by exercising options under the Director Plan may
be paid for only by cash or check. The purchase price is payable in full at
the time of exercise.
ADJUSTMENTS FOR RECAPITALIZATIONS, ETC.
The aggregate number of shares of Common Stock subject to, and the option
price of, unexercised options granted under the Director Plan shall be
proportionately adjusted under the same circumstances as under the Employee
Plan. See "PROPOSAL FOUR--APPROVAL OF GREAT FALLS BANCORP 1996 EMPLOYEE
STOCK OPTION PLAN--Adjustments for Recapitalizations, Etc."
REGISTRATION OF SHARES
The Corporation intends to register the Common Stock to be issued upon
exercise of options granted pursuant to the Director Plan under applicable
federal and state securities laws, but shall have no obligation to so
register such shares or to maintain in effect any such registration. If the
shares are not so registered, the Corporation will take precautions to comply
with applicable securities laws relating to the unregistered issuance of
shares which are similar to those under the Employee Plan. See "PROPOSAL
FOUR--APPROVAL OF GREAT FALLS BANCORP 1996 EMPLOYEE STOCK OPTION PLAN--
Registration of Shares".
EFFECTIVE DATE
The Director Plan and the options granted thereunder by the Board prior to
approval of the Director Plan by the Corporation's shareholders will become
effective only upon the Director Plan's approval by the affirmative vote,
either in person or by proxy, of the holders of a majority of the shares of
Stock entitled to vote and voting thereon at a meeting of the holders thereof
at which a quorum is present, in person or by proxy.
AMENDMENTS AND TERMINATION
The Corporation's Board of Directors may at any time amend the Director
Plan, except that shareholder approval is also required for any action which
would increase the maximum number of shares for which options may be granted
(other than as an adjustment due to a recapitalization, stock dividend,
etc.), expand the class of persons eligible to participate in the Director
Plan, decrease the minimum stock option price, extend the maximum terms of
options granted thereunder, or take any action requiring shareholder approval
under Rule 16b-3 under the 1934 Act. The Board also has the right to suspend
or terminate the Director Plan at any time. However, no action amending or
terminating the Director Plan may adversely affect a Participant's rights
under an outstanding option without that Participant's consent.
COMPLIANCE WITH SEC RULE 16B-3
The Director Plan is intended to comply with Rule 16b-3 under the
Securities Exchange Act of 1934. Any provisions inconsistent with such Rule
shall be inoperative.
FEDERAL INCOME TAX CONSEQUENCES
The following is a brief summary of certain federal income tax
consequences of the Director Plan to Participants and the Corporation based
on federal income tax laws in effect on January 1, 1996. This summary is not
intended to be complete and does not describe any state, local or foreign tax
consequences.
Options granted under the Director Plan are nonqualified stock options
(NQSOs). A Participant will not recognize income upon the grant of an option
under the Director Plan. A Participant will normally recognize ordinary
income at the time of exercise equal to the excess of the fair market value
at such time of the shares purchased over the option price (the "Spread").
The time of realization of income could, however, be deferred for up to six
months if the option holder could be subject to suit under Section 16(b) of
the 1934 Act.
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<PAGE>
The Banks (and thus the Corporation, assuming a continuation of its prior
practice of filing a consolidated federal income tax return) will be entitled
to a corresponding income tax deduction for federal income tax purposes for
the Spread at the same time the Participant's income is recognized, provided
any applicable withholding and/or tax reporting requirements and any other
applicable requirements are met.
PROPOSED DIRECTOR PLAN BENEFITS
On February 20, 1996 the Board of Directors granted options under the
Director Plan to purchase a total of 95,000 shares to the nonemployee
directors of the Banks as indicated on the following table. Such option
grants are subject to approval of the Director Plan by the Corporation's
shareholders at the Annual Meeting. The indicated options are exercisable at
a price of $16.875 per share, which was the mean between the bid and asked
prices for the Common Stock on the date of grant, as quoted by Ryan, Beck &
Co. Options granted to nonemployee directors of the Banks who are executive
officers of the Corporation consisted of options to purchase 50,000 shares
granted to Anthony M. Bruno, Jr., Vice Chairman of the Corporation, and
options to purchase 3,000 shares granted to John L. Soldoveri, the
Corporation's Chairman and Chief Executive Officer. Each of the remaining
optionees was granted an option to purchase 3,000 shares. All options were
granted on the terms and conditions described in the Director Plan. See "--
Terms and Conditions of Director Options."
<TABLE>
<CAPTION>
Directors of Great Falls Bank Directors of Bergen Commercial Bank
- --------------------------------------------------------------------------------------
<S> <C>
Annemarie Appleton Anthony M. Bruno, Jr.
Marino A. Bramante Stefano A. Masi
Robert J. Conklin Barry G. Novin
David M. Corry Michael R. Petriella
Robert B. Coyle Ralph W. Sifford
William T. Ferguson Charles J. Volpe
Joseph A. Lobosco
John L. Soldoveri
Richard Steuerwald
Alfred R. Urbano
All current director-executive officers 53,000
of the Corporation as a group
All current directors of the Corporation 42,000
who are not executive officers as a group
All other employees as a group 0
</TABLE>
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR APPROVAL OF THE GREAT FALLS BANCORP 1996 STOCK OPTION PLAN FOR
NONEMPLOYEE DIRECTORS.
- --------------------------------------------------------------------------------
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
- --------------------------------------------------------------------------------
Based upon a review of copies of Forms 3 and 4 filed with the Corporation
during 1995, Mr. William T. Ferguson was the only person subject to reporting
requirements of Section 16 of the 1934 Act during 1995 (relating to changes
in beneficial ownership of the Corporation's Common Stock) who failed to file
on a timely basis all reports which he was required to file with respect to
transactions in Common Stock during 1995. Mr. Ferguson's Forms 4 for
December, 1994 and April, 1995 were each filed eight days later than
applicable SEC regulations require.
31
<PAGE>
- --------------------------------------------------------------------------------
STOCKHOLDER PROPOSALS
- --------------------------------------------------------------------------------
Any proposal of a stockholder which is intended to be presented at the
1997 Annual Meeting of Stockholders must be received by the Corporation for
inclusion in next year's Proxy Statement on or before December 17, 1996.
- --------------------------------------------------------------------------------
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
The principal accountant for the Corporation and its subsidiaries for 1995
was Arthur Andersen LLP, Roseland, New Jersey. Arthur Andersen LLP has
served in that capacity since 1985. The Corporation has not yet appointed a
principal accountant for 1996 since the current engagement for 1995 has not
yet expired. It is expected that a representative of Arthur Andersen LLP
will be present at the Annual Meeting with the opportunity to make a
statement, if such representative desires to do so, and will be available to
respond to appropriate questions.
- --------------------------------------------------------------------------------
COSTS OF SOLICITATION; FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The Corporation will bear the costs of soliciting proxies for the Annual
Meeting. The Corporation will reimburse brokerage firms and other
custodians, nominees and fiduciaries for reasonable expenses incurred by them
in sending proxy materials to the beneficial owners of Common Stock. In
addition to solicitations by mail, directors, officers and regular employees
of the Corporation may solicit proxies personally or by telegraph, telephone
or fax (without compensation other than their regular compensation).
The Corporation's Annual Report to Stockholders for the year ended
December 31, 1995, including financial statements, has been mailed to all
stockholders of record as of the close of business on the Record Date. Any
stockholder who has not received a copy of such Annual Report may obtain a
copy by writing to the Secretary of the Corporation. Such Annual Report is
not to be treated as a part of the proxy soliciting material or as having
been incorporated herein by reference.
GREAT FALLS BANCORP
Edith A. Leonhard, Secretary
Totowa, New Jersey
April 1, 1996
- --------------------------------------------------------------------------------
ANNUAL REPORT ON FORM 10-KSB
- --------------------------------------------------------------------------------
ON WRITTEN REQUEST OF ANY STOCKHOLDER OF RECORD OR A BENEFICIAL OWNER OF THE
CORPORATION'S COMMON STOCK ON MARCH 1, 1996, THE CORPORATION WILL FURNISH
WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED
DECEMBER 31, 1995 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. ANY
SUCH WRITTEN REQUEST SHOULD BE DIRECTED TO NAQI A. NAQVI, TREASURER, GREAT
FALLS BANCORP, 55 UNION BLVD., TOTOWA, NJ 07512.
- --------------------------------------------------------------------------------
32
<PAGE>
APPENDIX A
----------
GREAT FALLS BANCORP
1996 EMPLOYEE STOCK OPTION PLAN
ARTICLE I. PURPOSES
--------
The purposes of the Great Falls Bancorp 1996 Employee Stock Option Plan
are to (i) attract and retain highly qualified employees, (ii) align employee
and stockholder long-term interests by creating a direct link between
employee compensation and stockholder return, (iii) enable employees of Great
Falls Bancorp (the "Corporation") and its Subsidiaries to develop and
maintain stock ownership positions in the Corporation, and (iv) provide
incentives to such employees to contribute to the Corporation's success. To
achieve these objectives, the Plan provides for the granting of "incentive
stock options" within the meaning of Section 422 of the Internal Revenue Code
of 1986, as amended, "nonqualified stock options" and "stock appreciation
rights."
ARTICLE II. DEFINITIONS
-----------
Whenever the following terms are used in this Plan, they shall have the
meanings specified below:
(a) "AFFILIATE" shall mean the Corporation or a Subsidiary.
(b) "BOARD" shall mean the Board of Directors of the Corporation.
(c) "CAUSE" shall mean (i) the conviction of the Participant of a felony
by a court of competent jurisdiction, (ii) the indictment of the Participant
by a State or Federal grand jury of competent jurisdiction for embezzlement
or misappropriation of funds of an Affiliate or for any act of dishonesty or
lack of fidelity towards an Affiliate, (iii) the written confession by the
Participant of any act of dishonesty towards an Affiliate or any embezzlement
or misappropriation of an Affiliate's funds, or (iv) willful or gross neglect
of the duties for which the Participant was responsible, all as the Board of
Directors of the Corporation, in its sole discretion, may determine.
(d) "CHANGE IN CONTROL" shall mean the occurrence of one or more of the
following events: (i) the Corporation acquires actual knowledge that any
person (as such term is used in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act) other than an Affiliate is or becomes the beneficial owner (as
defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of
securities of the Corporation representing more than 25% of the combined
voting power of the Corporation's then outstanding securities; (ii) the first
purchase of Common Stock pursuant to a tender or exchange offer (other than a
tender or exchange offer made by an Affiliate); (iii) the approval by the
Corporation's stockholders of (a) a merger or consolidation of the
Corporation with or into another corporation (other than a merger or
consolidation in which the Corporation is the surviving corporation and which
does not result in any reclassification or reorganization of the
Corporation's then outstanding shares of Common Stock or a change in the
Corporation's directors, other than the addition of not more than three
directors), (b) a sale or disposition of all or substantially all of the
Corporation's assets, or (c) a plan of liquidation or dissolution of the
Corporation; (iv) during any period of two consecutive calendar years,
individuals who at the beginning of such period constitute the Board of
Directors of the Corporation cease for any reason to constitute at least two-
thirds thereof, unless the election or nomination for the election by the
Corporation's stockholders of each new director was approved by a vote of at
least two-thirds of the directors then still in office who were directors at
the beginning of the period; or (v) a sale of (a) Common Stock of the
Corporation if after such sale any person (as defined above) other than an
Affiliate owns a majority of the Common Stock or (b) all or substantially all
of the Corporation's assets (other than in the ordinary course of business).
(e) "CODE" shall mean the Internal Revenue Code of 1986, as now in effect
or as hereafter amended. (All citations to sections of the Code are to such
sections as they may from time to time be amended or renumbered.)
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<PAGE>
(f) "COMMITTEE" shall mean the committee consisting of at least three (3)
directors of the Corporation appointed by the Board to administer the Plan
pursuant to the provisions of Article III of the Plan.
(g) "COMMON STOCK" shall mean the common stock of the Corporation, par
value $1.00 per share.
(h) "CORPORATION" shall mean Great Falls Bancorp, a New Jersey business
corporation.
(i) "DISABILITY" shall mean permanent and total disability as defined by
the Corporation's employee welfare benefit plan offering a long-term
disability benefit, or, if no such benefit is offered, as defined by Section
105(d)(4) of the Code (prior to the repeal of such Section). "Disability"
shall also exist if documented by a signed written opinion of a currently
licensed medical doctor reasonably satisfactory to the Board, which written
opinion shall set forth, without limitation, a medical opinion that the
Participant is permanently disabled, the reasons for such disability, and the
date of commencement of such disability.
(j) "EMPLOYEE" shall mean a common law employee (as defined in accordance
with the regulations and Revenue Rulings then applicable under Section
3401(c) of the Code) of an Affiliate.
(k) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as now
in effect or as hereafter amended.
(l) "FAIR MARKET VALUE OF STOCK" shall mean for all purposes of the Plan
as follows: (A) if the Shares are admitted to quotation on the National
Association of Securities Dealers Automated Quotation System ("NASDAQ") or
other comparable quotation system and have been designated as a National
Market System ("NMS") security, fair market value on any date shall be the
last sale price reported for the Shares on such system on such date or on the
last day preceding such date on which a sale was reported; (B) if the Shares
are admitted to quotation on NASDAQ and have not been designated an NMS
security, fair market value on any date shall be the average of the highest
bid and lowest asked prices of the Shares on such system on such date; (C) if
the Shares are admitted to trading on a national securities exchange, fair
market value on any date shall be the last sale price reported for the Shares
on such exchange on such date or on the last date preceding such date on
which a sale was reported; or (D) if neither (A), (B) nor (C) applies to the
Shares, fair market value on any date shall be a price equal to the mean
between the closing bid and asked prices for Shares, as quoted in writing to
the Corporation by Ryan, Beck & Co., Inc., a principal market maker for
transactions in the Corporation's Common Stock on the over-the-counter
market, or other market maker designated by the Committee or the Board of
Directors.
(m) "INCENTIVE STOCK OPTION" shall mean a Stock Option whose terms satisfy
the requirements imposed by Section 422 of the Code and which is intended by
the Committee to be treated as an Incentive Stock Option.
(n) "NONQUALIFIED STOCK OPTION" shall mean either (i) any Stock Option
which, when granted, is not an Incentive Stock Option, or (ii) an Incentive
Stock Option which, subsequent to its grant, ceases to qualify as an
Incentive Stock Option because of a failure to satisfy the requirements of
Section 422(b) of the Code.
(o) "NON-TANDEM STOCK APPRECIATION RIGHT" shall mean a Stock Appreciation
Right not awarded in connection with a Stock Option.
(p) "PARTICIPANT" shall mean an Employee who has been granted a Stock
Option and/or Stock Appreciation Right under the Plan.
(q) "PLAN" shall mean the Great Falls Bancorp 1996 Employee Stock Option
Plan, as may be amended from time to time.
(r) "RETIREMENT" shall mean any normal or early retirement by a
Participant pursuant to the terms of any pension, profit sharing or 401(k)
plan, or policy of the Corporation or any Subsidiary which is applicable to
such Participant at the time of his Termination of Service.
(s) "SECRETARY" shall mean the corporate secretary of the Corporation.
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<PAGE>
(t) "SECURITIES ACT" shall mean the Securities Act of 1933, as now in
effect or as hereafter amended.
(u) "SHARES" shall mean shares of Common Stock.
(v) "STOCK APPRECIATION RIGHT" shall mean a right to receive cash or
Common Stock in exchange for a Stock Appreciation Right which is awarded in
accordance with the terms of the Plan.
(w) "STOCK OPTION" shall mean a right to purchase Common Stock which is
awarded in accordance with the terms of this Plan.
(x) "SUBSIDIARY(IES)" shall mean any corporation or other legal entity,
domestic or foreign, more than 50% of the voting power of which is owned or
controlled, directly or indirectly by the Corporation.
(y) "TANDEM STOCK APPRECIATION RIGHT" shall mean a Stock Appreciation
Right awarded in connection with any Stock Option granted under the Plan,
either at the time the Stock Option is granted or thereafter at any time
prior to the exercise, termination or expiration of the related Stock Option.
(z) "TERMINATE (TERMINATION OF) SERVICE (OR TERMINATION)" shall mean the
time at which the Participant ceases to provide services to an Affiliate as
an Employee, but shall not include a lapse in providing services which the
Committee determines to be a temporary leave of absence.
ARTICLE III. ADMINISTRATION
--------------
The Plan shall be administered by a committee (the "Committee") of the
Board, which shall consist of all members of the Board who qualify as both:
(i) a "disinterested person" within the meaning of the rules promulgated
under Section 16(b) of the Exchange Act and (ii) an "outside director" within
the meaning of Section 162(m) of the Code. The Committee shall hold meetings
at such times as may be necessary for the proper administration of the Plan
and shall keep minutes of its meetings. A majority of the Committee shall
constitute a quorum and a majority of the quorum present at any meeting of
the Committee may authorize any action. No member of the Committee shall be
personally liable for any action, determination or interpretation made in
good faith with respect to the Plan or any Stock Option and/or Stock
Appreciation Right granted pursuant thereto. All members of the Committee
shall be indemnified by the Corporation with respect to any such action,
determination or interpretation to the fullest extent permitted by law.
Subject to the provisions of the Plan, the Committee shall have sole
authority, in its absolute discretion: (i) to determine which eligible
Employees shall be granted Stock Options and/or Stock Appreciation Rights;
(ii) to grant Stock Options and/or Stock Appreciation Rights; (iii) to
determine the times when Stock Options and/or Stock Appreciation Rights may
be granted and the number of Shares that may be purchased pursuant to such
Stock Options and/or the number of Shares associated with Stock Appreciation
Rights; (iv) to determine the exercise price of the Shares subject to each
Stock Option, which price shall be not less than the minimum specified in
Section 6.1; (v) to determine the time or times when each Stock Option and/or
Stock Appreciation Right becomes exercisable, the duration of the exercise
period, and any other restrictions on the exercise of Stock Options and/or
Stock Appreciation Rights issued hereunder; (vi) to prescribe the form or
forms of the Stock Option and/or Stock Appreciation Rights agreements under
the Plan; (vii) to determine the circumstances under which the time for
exercising Stock Options and/or Stock Appreciation Rights should be
accelerated and to accelerate the time for exercising outstanding Stock
Options and/or Stock Appreciation Rights; (viii) to determine the duration
and purposes for leaves of absence which may be granted to a Participant
without constituting a Termination of Service for purposes of the Plan; (ix)
to adopt, amend and rescind such rules and regulations as, in its opinion,
may be advisable in the administration of the Plan; and (x) to construe and
interpret the Plan, the rules and regulations and the Stock Option and Stock
Appreciation Rights agreements under the Plan, and to make all other
determinations deemed necessary or advisable for the administration of the
Plan; provided, however, that with respect to those eligible Employees who
are not "officers" of the Corporation, within the meaning of Section 16(b) of
the Exchange Act, the Committee may delegate to any person or persons
("Subcommittee") all or any part of its authority as set forth in (i) through
(x) above. All references in the Plan to the powers of a Subcommittee to act
for the Committee shall be applicable only to the extent consistent with the
foregoing provision and only to the extent consistent with the powers which
have actually been delegated to it. All decisions, determinations
A-3
<PAGE>
and interpretations of the Committee, or Subcommittee, to the extent
consistent with such delegation, shall be final and binding.
The provisions of this Article III shall survive any termination of the
Plan.
ARTICLE IV. SHARES SUBJECT TO PLAN
----------------------
The aggregate maximum number of Shares that may be made subject to Stock
Options and Non-Tandem Stock Appreciation Rights granted pursuant to the Plan
is Two Hundred Thousand (200,000) (or the number and kind of Shares or other
securities which are substituted for those Shares or to which those Shares
are adjusted pursuant to the provisions of Article X of the Plan). The
Corporation shall reserve such number of Shares for the purposes of the Plan
out of its authorized but unissued shares, or out of Shares held in the
Corporation's treasury, or partly out of each, as shall be determined by the
Board. No fractional Shares shall be issued with respect to Stock Options or
Stock Appreciation Rights granted under the Plan.
In the event that any outstanding Stock Option or Stock Appreciation Right
under the Plan for any reason expires, is terminated, forfeited or is
canceled prior to the expiration date of the Plan, the Shares called for by
the unexercised portion of such Stock Option or Stock Appreciation Right may,
to the extent permitted by Rule 16b-3 under the Exchange Act, again be
subject to a Stock Option or Stock Appreciation Right under the Plan.
ARTICLE V. ELIGIBILITY FOR AWARD OF STOCK OPTIONS
--------------------------------------
AND/OR STOCK APPRECIATION RIGHTS
--------------------------------
All officers who are Employees and other Employees of one or more of the
Affiliates shall be eligible to receive Stock Options and/or Stock
Appreciation Rights under the Plan. Non-Employee directors shall not be
eligible to participate in the Plan. However, a person who otherwise is an
eligible officer or Employee shall not be disqualified from participation in
the Plan by virtue of being a director of the Corporation or any Subsidiary.
ARTICLE VI. GRANT OF STOCK OPTIONS AND/OR
-----------------------------
STOCK APPRECIATION RIGHTS
-------------------------
The Committee or Subcommittee may in its sole discretion grant Stock
Options and/or Stock Appreciation Rights to such Employees as it determines
appropriate consistent with Article V. Stock Options and/or Stock
Appreciation Rights shall be evidenced by Stock Option and/or Stock
Appreciation Rights agreements (which need not be identical) in such forms as
the Committee may from time to time approve.
Stock Option and/or Stock Appreciation Right agreements shall conform to
the terms and conditions of the Plan. Such agreements may provide that the
grant of any Stock Option and/or Stock Appreciation Right under the Plan, or
that Stock acquired pursuant to the exercise of any Stock Option and/or Stock
Appreciation Right, shall be subject to such other conditions (whether or not
applicable to the Stock Option and/or Stock Appreciation Right, or Stock
received by any other Participant), as the Committee determines appropriate,
including, without limitation, provisions conditioning exercise upon the
occurrence of certain events or performance or the passage of time,
provisions to assist the participant in financing the purchase of Stock
through the exercise of Stock Options, provisions for forfeiture, or
restrictions on resale or other disposition, of Shares acquired under the
Plan, provisions giving the Corporation the right to repurchase Shares
acquired under the Plan in the event the Participant elects to dispose of
such Shares, and provisions to comply with Federal and State securities laws
and Federal and State income tax and other payroll tax withholding
requirements. Stock Options granted under this Plan which are intended to
qualify as Incentive Stock Options shall be specifically designated as such
in the Stock Option agreement.
6.1 OPTION PRICE OF STOCK OPTIONS. The exercise price for each Stock Option
granted under the Plan shall be determined by the Committee or Subcommittee;
provided, however, that it shall not be less than the Fair Market Value of
the Stock on the date of grant.
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<PAGE>
6.2 EXERCISABILITY AND TERMS OF STOCK OPTIONS AND/OR STOCK APPRECIATION
RIGHTS. The Committee or Subcommittee shall, subject to the terms of the
Plan, determine the dates after which Stock Options and/or Stock Appreciation
Rights may be exercised, in whole or in part, and may establish a vesting
schedule that must be satisfied before Stock Options and/or Stock
Appreciation Rights may be exercised; provided, however, that no Stock Option
and/or Stock Appreciation Right may be exercisable within six months of the
date it is granted, other than in the event of an acceleration as provided in
Section 6.3. A Stock Option and/or Stock Appreciation Right may provide that
if it is exercisable in installments, installments which are exercisable and
not exercised shall remain exercisable during the term of the Stock Option
and/or the Stock Appreciation Right.
All Incentive Stock Options shall have a term of no more than ten years
from the date of grant. Upon the Termination of Service of a Participant due
to (i) voluntary resignation or involuntary dismissal without Cause, or (ii)
Retirement, all Stock Options and/or Stock Appreciation Rights that have not
become exercisable before the date the Participant Terminates Service shall
be forfeited and terminated immediately. The Participant may exercise a
Stock Option and/or Stock Appreciation Right to the extent it was exercisable
by him on the date immediately preceding such Termination within the lesser
of (i) one month from the date of Termination (six months from the date of
Termination in the case of Retirement), or (ii) the balance of the stated
term of the Stock Option and/or Stock Appreciation Right. If a Participant's
employment shall be terminated with Cause, all Stock Options and/or Stock
Appreciation Rights granted to such Participant that have not been exercised
prior to such Termination for Cause shall, whether or not exercisable, be
forfeited immediately upon such Termination.
6.3 ACCELERATED VESTING AND EXERCISABILITY OF STOCK OPTIONS AND STOCK
APPRECIATION RIGHTS. If a Participant shall Terminate Service by reason of
his death or Disability, all Stock Options and/or Stock Appreciation Rights
granted to such Participant that have not become exercisable on or before the
date of such Termination shall immediately become both "vested" and fully
exercisable. All Stock Options and/or Stock Appreciation Rights held by such
Participant may be exercised by the Participant, his estate or beneficiary,
or his representative, as the case may be, for a period of one year from the
date of such Termination, or until the expiration of the stated term of such
Stock Options and/or Stock Appreciation Rights, whichever period is shorter.
Notwithstanding the provisions of Section 6.2, in the event of a Change in
Control, any Stock Option and/or Stock Appreciation Right granted under the
Plan to a Participant which has not, as of the date of the Change in Control,
become exercisable shall immediately become both "vested" and fully
exercisable.
6.4 NONTRANSFERABILITY OF STOCK OPTIONS AND/OR STOCK APPRECIATION RIGHTS.
No Stock Option or Stock Appreciation Right shall be transferable except by
will or the laws of descent and distribution. During the lifetime of the
Participant, the Stock Option and/or Stock Appreciation Right shall be
exercisable only by him or, in the event of the Participant's incapacity or
death, by the Participant's guardian or legal representative. More
specifically, without limitation, no Stock Option and/or Stock Appreciation
Right may be assigned, transferred (except as specifically permitted by the
Plan or the terms of the specific Stock Option or Stock Appreciation Right
agreement consistent with the Plan), pledged or hypothecated in any way, nor
shall it be assignable by operation of law or subject to execution,
attachment, garnishment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of a Stock Option and/or
Stock Appreciation Right contrary to the provisions hereof, and the levy of
any execution, attachment, garnishment or similar process upon the Stock
Option and/or Stock Appreciation Right, shall be null and void, and without
force or effect. The Committee may, however, in its sole discretion, allow
for transfers of Nonqualified Stock Options, Non-Tandem Stock Appreciation
Rights, and Tandem Stock Appreciation Rights issued in connection with Non-
Qualified Stock Options to family members, subject to such conditions or
limitations as the Board may establish to ensure compliance with Rule 16b-3
promulgated pursuant to the Exchange Act, or for other purposes.
6.5 NO OBLIGATION TO EXERCISE STOCK OPTIONS AND/OR STOCK APPRECIATION
RIGHTS. The grant of a Stock Option and/or Stock Appreciation Right shall
impose no obligation on the Participant to exercise such Stock Option and/or
Stock Appreciation Right.
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<PAGE>
6.6 CANCELLATION OF STOCK OPTIONS AND/OR STOCK APPRECIATION RIGHTS. The
Committee, or Subcommittee, in its discretion, may, with the consent of any
Participant, cancel any outstanding Stock Option and/or Stock Appreciation
Right.
6.7 NO RIGHTS AS A STOCKHOLDER. A Participant or a transferee of a Stock
Option and/or Stock Appreciation Right shall have no rights as a stockholder
with respect to any Share covered by his Stock Option and/or Stock
Appreciation Right until he shall have become the holder of record of such
Share, and he shall not be entitled to any dividends or distributions or
other rights in respect of such Share for which the record date is prior to
the date on which he shall have become the holder of record thereof.
6.8 SPECIAL PROVISIONS APPLICABLE TO INCENTIVE STOCK OPTIONS. To the extent
the aggregate Fair Market Value (determined as of the time the Stock Option
is granted) of the Stock with respect to which any Stock Options granted
hereunder which are intended to be Incentive Stock Options may be exercisable
for the first time by the Participant in any calendar year (under this Plan
or any other stock option plan of the Corporation or any parent or Subsidiary
thereof) exceeds $100,000, such Stock Options shall not be considered
Incentive Stock Options.
No Incentive Stock Option may be granted to an individual who, at the time
the Stock Option is granted, owns directly, or indirectly within the meaning
of Section 424(d)of the Code, stock possessing more than 10 percent of the
total combined voting power of all classes of stock of the Corporation or of
any parent or Subsidiary thereof, unless such Stock Option (i) has an
exercise price of at least 110 percent of the Fair Market Value of the Stock
on the date of the grant of such Stock Option, and (ii) cannot be exercised
more than five years after the date it is granted.
Each participant who receives an Incentive Stock Option must agree to
notify the Corporation in writing immediately after the Participant makes a
disqualifying disposition of any Stock acquired pursuant to the exercise of
an Incentive Stock Option. A disqualifying disposition is any disposition
(including any sale) of such Stock before the later of (i) two years after
the date the Participant was granted the Incentive Stock Option or (ii) one
year after the date the Participant acquired Stock by exercising the
Incentive Stock Option. Any transfer of ownership to a broker or nominee
shall be deemed to be a disposition unless the Participant provides proof
satisfactory to the Committee of his continued beneficial ownership of the
Stock.
Any other provision of the Plan to the contrary notwithstanding, no
Incentive Stock Option shall be granted after the date which is ten years
from the date this Plan is adopted, or the date the Plan is approved by the
stockholders of the Corporation, whichever is earlier.
6.9 DEFERRED EXERCISE OF STOCK OPTIONS AND STOCK APPRECIATION RIGHTS. If a
Participant's timely exercise of a Nonqualified Stock Option and/or Stock
Appreciation Right during a given taxable year, together with other
compensation paid to the Participant for such year, would result in a
disallowance for Federal income tax purposes, pursuant to Section 402(m) of
the Code, of a deduction to the Corporation of all or part of the
Participant's income to be recognized during such taxable year for Federal
income tax purposes upon such exercise, then such Participant's exercise of
such Nonqualified Stock Option and/or Stock Appreciation Right shall be
ineffective and such exercise shall be automatically deferred (except to the
extent specifically permitted by the Committee) beyond the end of such
taxable year of the Corporation to the extent necessary to avoid such
disallowance of a deduction to the Corporation. The deferral of exercise of
a Nonqualified Stock Option and/or Stock Appreciation Right provided by this
Section 6.9 shall be until the next succeeding taxable year in which the
Corporation is not denied a tax deduction related to such exercise. The
deferral of exercise is for the Corporation's benefit and therefore
supersedes any other limitation on exercisability which may be set forth in
any other provision of this Plan or any Stock Option or Stock Appreciation
Right agreement.
ARTICLE VII. EXERCISE OF STOCK OPTIONS
-------------------------
Any Stock Option may be exercised in whole or in part at any time
subsequent to such Stock Option's becoming exercisable during the term of
such Stock Option; provided, however, that each partial exercise shall be for
whole Shares only. Each Stock Option, or any exercisable portion thereof,
may only be exercised by delivery to the Secretary or his office of (i)
notice in writing signed by the Participant (or other person then
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entitled to exercise such Stock Option) that such Stock Option, or a
specified portion thereof, is being exercised; (ii) payment in full for the
purchased Shares (as specified in Section 7.2 below); (iii) such
representations and documents as are necessary or advisable to effect
compliance with all applicable provisions of Federal or State securities laws
or regulations; (iv) in the event that the Stock Option or portion thereof
shall be exercised pursuant to Section 6.3 or 6.4 by any person or persons
other than the Participant, appropriate proof of the right of such person or
persons to exercise the Stock Option or portion thereof; and (v) full payment
to the Corporation of all amounts which, under Federal or State law, it is
required to withhold upon exercise of the Stock Option (as specified in
Section 7.3 below).
7.1 SHARE CERTIFICATES. Upon receiving notice and payment, the Corporation
will cause to be delivered to the Participant, as soon as practicable, a
certificate in the Participant's name for the Shares purchased. The Shares
issuable and deliverable upon the exercise of a Stock Option shall be fully
paid and nonassessable. The Corporation shall not be required to issue or
deliver any certificate or certificates for Shares purchased upon the
complete or partial exercise of the Stock Option prior to fulfillment of (i)
the completion of any registration or other qualification of such Shares
under any Federal or State law or under rulings or regulations of the
Securities and Exchange Commission or of any other governmental regulatory
body which may be necessary or advisable; and (ii) the obtaining of any
approval or other clearance from any Federal or State governmental agency
which may be necessary or advisable.
7.2 PAYMENT FOR SHARES. Payment for Shares purchased under a Stock Option
granted hereunder shall be made in full upon exercise of the Stock Option, by
certified or bank cashier's check payable to the order of the Corporation or,
unless otherwise prohibited by the terms of a Stock Option agreement, by one
or more of the following: (i) in the form of Shares already owned by the
Participant based in any such instance on the Fair Market Value of the Stock
on the date the Stock Option is exercised; provided, however, that, in the
case of an Incentive Stock Option, the right to make a payment in the form of
already owned Shares may be authorized only at the time the Stock Option is
granted; (ii) by a combination thereof, in each case in the manner provided
in the Stock Option agreement; or (iii) by any other means acceptable to the
Corporation. To the extent the Stock Option exercise price may be paid in
Shares as provided above, Shares delivered by the Participant may be (i)
Shares which were received by the Participant upon exercise of one or more
Incentive Stock Options, but only if such Shares have been held by the
Participant until the later of (a) two years from the date the Incentive
Stock Options were granted or (b) one year after the transfer of Shares to
the Participant, or (ii) Shares which were received by the Participant upon
exercise of one or more Nonqualified Stock Options and/or Stock Appreciation
Rights, but only if such Shares have been held by the Participant for at
least six months.
7.3 SHARE WITHHOLDING. The Committee shall require that a Participant pay
to the Corporation, at the time of exercise of a Nonqualified Stock Option
and/or Stock Appreciation Right, such amount as the Committee deems necessary
to satisfy the Corporation's obligation to withhold Federal or State income
or other taxes incurred by reason of the exercise or the transfer of Shares
thereupon. A Participant may satisfy such withholding requirements by having
the Corporation withhold from the number of Shares otherwise issuable upon
exercise of the Stock Option and/or Stock Appreciation Right that number of
shares having an aggregate fair market value on the date of exercise equal to
the minimum amount required by law to be withheld; provided, however, that in
the case of an exercise by a Participant who is subject to Section 16(b) of
the Exchange Act, such Participant must (i) exercise the Stock Option and/or
the Stock Appreciation Right during the period beginning on the third
business day following the date of release to the press of the quarterly or
annual summary of earnings for the Corporation, and ending on the twelfth
business day following such date, or (ii) irrevocably elect to utilize Share
withholding at least six months prior to the date of exercise.
7.4 LOANS. The Corporation may make loans to such Participants as the
Committee, in its discretion, may determine in connection with the exercise
of Stock Options granted under the Plan; provided, however, that the
Committee shall not authorize the making of any loan where the possession of
such discretion or the making of such loan would either result in a
"modification" (as defined in Section 424 of the Code) of any Incentive Stock
Option or disqualify such Stock Option from otherwise qualifying as an
Incentive Stock Option. Such loans may be subject to the following terms and
conditions and such other terms and conditions as the Committee shall
determine not inconsistent with the Plan. Such loans may bear interest at
such rates as the Committee shall determine from time to time, which rates
may be below then current market rates. In no event may any such loan exceed
the exercise price, at the date of exercise, of the Shares
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covered by the Stock Option or portion thereof exercised by the Participant.
When a loan shall have been made, the Committee may require that Shares of
Common Stock and/or other collateral having a fair market value at least
equal to the principal amount of the loan shall be pledged by the Participant
to the Corporation as security for payment of the unpaid balance of the loan.
Every loan shall also comply with all applicable laws, regulations and rules
of the Board of Governors of the Federal Reserve System and any other
governmental agency having jurisdiction thereof.
ARTICLE VIII. EXERCISE OF TANDEM STOCK APPRECIATION RIGHT
-------------------------------------------
A Tandem Stock Appreciation Right shall be exercisable only to the extent
that the related Stock Option is exercisable. Each Tandem Stock Appreciation
Right, or any exercisable portion thereof, may only be exercised by delivery
to the Secretary or his office of (i) notice in writing signed by the
Participant (or other person then entitled to exercise such Tandem Stock
Appreciation Right) that such Tandem Stock Appreciation Right, or a specified
portion thereof, is being exercised; (ii) such representations and documents
as are necessary or advisable to effect compliance with all applicable
provisions of Federal or State securities laws or regulations; (iii) in the
event that the Tandem Stock Appreciation Right or portion thereof shall be
exercised pursuant to Section 6.3 or 6.4 by any person or persons other than
the Participant, appropriate proof of the right of such person or persons to
exercise the Tandem Stock Appreciation Right or portion thereof; and (iv)
full payment to the Corporation of all amounts which, under Federal or State
law, it is required to withhold upon exercise of the Stock Appreciation Right
(as specified in Section 7.3).
On exercise of a Tandem Stock Appreciation Right, the Participant shall
surrender unexercised, the related Stock Option (or such portion or portions
thereof which the Participant from time to time determines to surrender for
this purpose) and shall receive in exchange, subject to the rules and
regulations as from time to time may be established by the Committee, a
payment having an aggregate value equal to (A) the excess of (i) the Fair
Market Value of the Stock on the exercise date per share over (ii) the Option
Price of the related Stock Option per share, times (B) the number of Shares
called for by the related Stock Option or portion thereof which is
surrendered.
The payment due the Participant upon the exercise of a Tandem Stock
Appreciation Right shall be made (i) in cash, (ii) in Common Stock (valued
with reference to the Fair Market Value of Stock as of the date of exercise),
or (iii) partly in cash and partly in Common Stock (valued with reference to
the Fair Market Value of Stock as the date of exercise), as set forth by the
Tandem Stock Appreciation Right agreement, and by the Committee, in its sole
discretion. If the payment is to be made in Common Stock, no fractional
shares of Common Stock shall be issued and cash payment shall be made in lieu
of fractional shares. Notwithstanding any provision in this Plan to the
contrary, in the case of an exercise of a Tandem Stock Appreciation Right by
a Participant who is subject to Section 16(b) of the Exchange Act, such
Participant may exercise the Tandem Stock Appreciation Right only during the
period beginning on the third business day following the date of release to
the press of the quarterly or annual summary of earnings for the Corporation,
and ending on the twelfth business day following such date.
Any Shares issuable and deliverable upon the exercise of a Tandem Stock
Appreciation Right shall be fully paid and nonassessable. The Corporation
shall not be required to issue or deliver any certificate or certificates
upon the complete or partial exercise of a Tandem Stock Appreciation Right
prior to fulfillment of (i) the completion of any registration or other
qualification of such Shares under any Federal or State law or under rulings
or regulations of the Securities and Exchange Commission or of any other
governmental regulatory body which the Corporation may deem necessary or
advisable; and (ii) the obtaining of any approval or other clearance from any
Federal or State governmental agency which the Corporation may deem necessary
or advisable.
No payment shall be required from the Participant upon the exercise of a
Tandem Stock Appreciation Right, except that any amount necessary to satisfy
applicable Federal, state or local tax requirements shall be withheld or paid
prior to or concurrently with delivery of cash or Shares.
Upon the exercise of a Tandem Stock Appreciation Right, the number of
Shares subject to exercise under the related Stock Option shall automatically
be reduced by the number of Shares represented by the Stock Option or portion
thereof surrendered. Shares subject to Stock Options or portions thereof
surrendered
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upon the exercise of a Tandem Stock Appreciation Right shall not be available
for subsequent awards under this Plan.
Notwithstanding any provision in this Plan to the contrary, a Tandem Stock
Appreciation Right shall be issued in connection with an Incentive Stock
Option only if the Tandem Stock Appreciation Right meets the following
requirements:
(a) The Tandem Stock Appreciation Right will expire no later than the
expiration of the underlying Incentive Stock Option;
(b) The Tandem Stock Appreciation Right provides for a payment to the
Participant not in excess of the difference between the exercise price of the
underlying Incentive Stock Option and the Fair Market Value of Stock subject
to the underlying Incentive Stock Option at the time the Tandem Stock
Appreciation Right is exercised;
(c) The Tandem Stock Appreciation Right is transferable only when the
underlying Incentive Stock Option is transferable, and under the same
conditions;
(d) The Tandem Stock Appreciation Right may be exercised only when the
underlying Stock Option is eligible to be exercised; and
(e) The Tandem Stock Appreciation Right may be exercised only when the
Fair Market Value of Stock subject to the Incentive Stock Option exceeds the
exercise price of the Incentive Stock Option.
ARTICLE IX. EXERCISE OF NON-TANDEM STOCK APPRECIATION RIGHT
-----------------------------------------------
Each Non-Tandem Stock Appreciation Right, or any exercisable portion
thereof, may only be exercised by delivery to the Secretary or his office of
(i) notice in writing signed by the Participant (or other person then
entitled to exercise such Non-Tandem Stock Appreciation Right) that such Non-
Tandem Stock Appreciation Right, or a specified portion thereof, is being
exercised; (ii) such representations and documents as are necessary or
advisable to effect compliance with all applicable provisions of Federal or
State securities laws or regulations; (iii) in the event that the Non-Tandem
Stock Appreciation Right or portion thereof shall be exercised pursuant to
Section 6.3 or 6.4 by any person or persons other than the Participant,
appropriate proof of the right of such person or persons to exercise the Non-
Tandem Stock Appreciation Right or portion thereof; and (iv) full payment to
the Corporation of all amounts which, under Federal or State law, it is
required to withhold upon exercise of the Stock Appreciation Right (as
specified in Section 7.3).
On exercise of a Non-Tandem Stock Appreciation Right, the Participant
shall receive, subject to the rules and regulations as from time to time may
be established by the Committee, a payment having an aggregate value equal to
(A) the excess of (i) the Fair Market Value of Stock on the exercise date
over (ii) the Fair Market Value of Stock on the date of grant, times (B) the
number of Shares which are subject to the Non-Tandem Stock Appreciation Right
which is being exercised.
The payment due the Participant upon the exercise of a Non- Tandem Stock
Appreciation Right shall be made (i) in cash, (ii) in Common Stock (valued
with reference to the Fair Market Value of Stock as of the date of exercise),
or (iii) partly in cash and partly in Common Stock (valued with reference to
the Fair Market Value of Stock as the date of exercise), as set forth by the
Non-Tandem Stock Appreciation Right agreement, and by the Committee, in its
sole discretion. If the payment is to be made in Common Stock, no fractional
shares of Common Stock shall be issued and cash payment shall be made in lieu
of fractional shares. Notwithstanding any provision in this Plan to the
contrary, in the case of an exercise of a Non-Tandem Stock Appreciation Right
by a Participant who is subject to Section 16(b) of the Exchange Act, such
Participant may exercise the Non-Tandem Stock Appreciation Right only during
the period beginning on the third business day following the date of release
to the press of the quarterly or annual summary of earnings for the
Corporation, and ending on the twelfth business day following such date.
Any Shares issuable and deliverable upon the exercise of a Non-Tandem
Stock Appreciation Right shall be fully paid and nonassessable. The
Corporation shall not be required to issue or deliver any certificate or
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certificates upon the complete or partial exercise of a Non-Tandem Stock
Appreciation Right prior to fulfillment of (i) the completion of any
registration or other qualification of such Shares under any Federal or State
law or under rulings or regulations of the Securities and Exchange Commission
or of any other governmental regulatory body which the Corporation may deem
necessary or advisable; and (ii) the obtaining of any approval or other
clearance from any Federal or State governmental agency which the Corporation
may deem necessary or advisable.
No payment shall be required from the Participant upon the exercise of a
Non-Tandem Stock Appreciation Right, except that any amount necessary to
satisfy applicable Federal, state or local tax requirements shall be withheld
or paid prior to or concurrently with delivery of cash or Shares.
ARTICLE X. ADJUSTMENT FOR RECAPITALIZATION, ETC.
-------------------------------------
The aggregate number of Shares which may be purchased under the Plan
pursuant to Stock Options or issued pursuant to Stock Appreciation Rights,
the number of Shares covered by each outstanding Stock Option and Stock
Appreciation Right, and the exercise price of each Stock Option and the Fair
Market Value of Stock on the date of grant of a Non-Tandem Stock Appreciation
Right shall be appropriately adjusted for any increase or decrease in the
number of outstanding Shares resulting from a stock split or other
subdivision or consolidation of Shares or for other capital adjustments or
payments of stock dividends or distributions, other increases or decreases in
the outstanding Shares effected without receipt of consideration by the
Corporation, or reorganization, merger or consolidation, or other similar
change affecting the Shares.
Such adjustment to a Stock Option or Stock Appreciation Right shall be
made without a change to the total exercise price applicable to the
unexercised portion of the Stock Option or total value applicable to the
unexercised portion of a Stock Appreciation Right (except for any change in
the aggregate price resulting from rounding-off of Share quantities or
prices). Any such adjustment made by the Committee shall be final and
binding upon all Participants, the Corporation, their representatives, and
all other interested persons. No fractional Shares shall be issued as a
result of such adjustment.
In the event of a transaction involving (i) the liquidation or dissolution
of the Corporation, (ii) a merger or consolidation in which the Corporation
is not the surviving corporation or (iii) the sale or disposition of all or
substantially all of the Corporation's assets, provision shall be made in
connection with such transaction for the assumption of Stock Options and/or
Stock Appreciation Rights theretofore granted under the Plan, or the
substitution for such Stock Options and/or Stock Appreciation Rights of new
Stock Options and/or Stock Appreciation Rights of the successor corporation,
with appropriate adjustment as to the number and kind of Shares and the
purchase price for Shares thereunder, or, in the discretion of the Committee,
the Plan and the Stock Options and/or Stock Appreciation Rights issued
hereunder shall terminate on the effective date of such transaction if
appropriate provision is made for payment to the Participant of an amount in
cash equal to the fair market value of a Share multiplied by the number of
Shares subject to the Stock Options or Stock Appreciation Rights (to the
extent such Stock Options or Stock Appreciation Rights have not been
exercised) less the exercise price for such Stock Options (to the extent such
Stock Options have not been exercised) or the Fair Market Value of the Stock
on the date of grant of such Stock Appreciation Rights (to the extent such
Stock Appreciation Rights have not been exercised); provided, however, that
in no event shall the Committee take any action or make any determination
under this Article X which would prevent a transaction described in clause
(ii) or (iii) above from being treated as a pooling of interests under
generally accepted accounting principles.
ARTICLE XI. GOVERNMENT REGULATIONS AND REGISTRATION OF SHARES
-------------------------------------------------
The Plan, and the grant and exercise of Stock Options and/or Stock
Appreciation Rights thereunder, and the Corporation's obligation to sell,
deliver stock, and make payments under such Stock Options and/or Stock
Appreciation Rights, shall be subject to all applicable Federal and State
laws, rules and regulations and to such approvals by any regulatory or
governmental agency as may be required.
Each Stock Option and/or Stock Appreciation Right is subject to the
requirement that if, at any time, the Committee determines, in its absolute
discretion, that the listing, registration or qualification of Shares
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issuable pursuant to the Plan is required by any securities exchange or
NASDAQ or under any State or Federal law, or the consent or approval of any
governmental regulatory body is necessary or desirable as a condition of, or
in connection with, the issuance of Shares, no Shares shall be issued, in
whole or in part, unless such listing, registration, qualification, consent
or approval has been effected or obtained, free of any conditions not
acceptable to the Committee. The Corporation shall not be deemed, by reason
of the granting of any Stock Option and/or Stock Appreciation Right, to have
any obligation to register the Shares subject to such Stock Option and/or
Stock Appreciation Right under the Securities Act or to maintain in effect
any registration of such Shares which may be made at any time under the
Securities Act.
Unless a registration statement under the Securities Act and the
applicable rules and regulations thereunder is then in effect with respect to
Shares issued upon exercise of any Stock Option and/or Stock Appreciation
Right (which registration shall not be required), the Corporation shall
require that the offer and sale of such Shares be exempt from the
registration provisions of said Act. In furtherance of such exemption, the
Corporation may require, as a condition precedent to the exercise of any
Stock Option and/or Stock Appreciation Right, that the person exercising the
Stock Option and/or Stock Appreciation Right give to the Corporation written
representation and undertaking, satisfactory in form and substance to the
Corporation, that he is acquiring the Shares for his own account for
investment and not with a view to the distribution or resale thereof and
otherwise establish to the Corporation's satisfaction that the offer or sale
of the Shares issuable upon exercise of the Stock Option and/or Stock
Appreciation Right will not constitute or result in any breach or violation
of the Securities Act or any similar State act or statute or any rules or
regulations thereunder. In the event a Registration Statement under the
Securities Act is not then in effect with respect to the Shares issued upon
exercise of a Stock Option and/or Stock Appreciation Right, the Corporation
shall place upon any stock certificate an appropriate legend referring to the
restrictions on disposition under the Securities Act.
The Corporation is relieved from any liability for the nonissuance or
nontransfer or any delay in issuance or transfer of any Shares subject to
Stock Options and/or Stock Appreciation Rights under the Plan which results
from the inability of the Corporation to obtain, or in any delay in
obtaining, from any regulatory body having jurisdiction, all requisite
authority to issue or transfer Shares upon exercise of the Stock Options
and/or Stock Appreciation Rights under the Plan if counsel for the
Corporation deems such authority necessary for lawful issuance or transfer of
any such Shares. Appropriate legends may be placed on the stock certificates
evidencing Shares issued upon exercise of Stock Options and/or Stock
Appreciation Rights to reflect such transfer restrictions.
ARTICLE XII. OTHER PROVISIONS
----------------
The validity, interpretation and administration of the Plan and any rules,
regulations, determinations or decisions made thereunder, and the rights of
any and all persons having or claiming to have any interest therein or
thereunder, shall be determined exclusively in accordance with the laws of
the State of New Jersey.
As used herein, the masculine gender shall include the feminine gender.
The headings in the Plan are for reference purposes only and shall not
affect the meaning or interpretation of the Plan.
All notices or other communications made or given pursuant to this Plan
shall be in writing and shall be sufficiently made or given if hand-delivered
or mailed by certified mail, addressed to any Participant at the address
contained in the records of the Corporation or to the Corporation at its
principal office.
The proceeds received from the sale of Shares pursuant to the Plan shall
be used for general corporate purposes.
Nothing in the Plan or in any Stock Option and/or Stock Appreciation Right
granted hereunder shall confer on any Participant or eligible Employee any
right to continue in the employ of the Corporation or any of its
Subsidiaries, or to interfere in any way with the right of the Corporation or
any of its Subsidiaries to terminate such Participant's or Employee's
employment at any time.
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The Plan is intended to comply with Rule 16b-3 promulgated under the
Exchange Act and the Committee shall interpret and administer the provisions
of the Plan or any Stock Option and/or Stock Appreciation Right in a manner
consistent therewith. Any provisions inconsistent with such Rule shall be
inoperative and shall not affect the validity of the Plan.
All expenses and costs incurred in connection with the operation of the
Plan shall be borne by the Corporation.
The adoption of this Plan shall not affect any other compensation or
incentive plans in effect for the Affiliates, or any of them. Nothing in
this Plan shall be construed to limit the right of any Affiliate (i) to
establish, alter or terminate any other forms of incentives, benefits or
compensation for Employees, including, without limitation, conditioning the
right to receive other incentives, benefits or compensation on an Employee's
not participating in this Plan; or (ii) to grant or assume options otherwise
than under this Plan in connection with any proper corporate purpose,
including, without limitation, the grant or assumption of stock options in
connection with the acquisition by purchase, lease, merger, consolidation or
otherwise, of the business, stock, or assets of any corporation, firm or
association.
Participants shall have no rights as shareholders unless and until
certificates for Shares are registered in their names in satisfaction of a
properly exercised Stock Option and/or Stock Appreciation Right.
If the Committee or Subcommittee shall find that any person to whom any
benefit is due or payable under the Plan is unable to care for his affairs
because of illness or accident, or is a minor, or has died, then any payment
due to such person or his estate (unless a prior claim therefor has been made
by a duly appointed legal representative), may, if the Committee or
Subcommittee so directs the Corporation, be paid to his spouse, child,
relative, an institution maintaining or having custody of such person, or any
other person deemed by the Committee to be a proper recipient on behalf of
such person otherwise entitled to payment. Any such payment shall be a
complete discharge of the liability of the Committee and the Corporation
therefor.
ARTICLE XIII. EFFECTIVE DATE AND EXPIRATION DATE OF PLAN
------------------------------------------
The Plan is effective as of such date as it is approved by the
stockholders of the Corporation in a manner which complies with Rule 16b-3
under the Exchange Act and Section 422 of the Code and applicable State law.
ARTICLE XIV. AMENDMENT OR DISCONTINUANCE OF PLAN
-----------------------------------
The Board may, without the consent of the Corporation's stockholders or
Participants under the Plan, at any time terminate the Plan entirely, and at
any time or from time to time amend or modify the Plan, provided that no such
action shall adversely affect Stock Options and/or Stock Appreciation Rights
theretofore granted hereunder without the Participant's consent, and provided
further that no such action by the Board, without approval of the
stockholders, may (i) materially increase the total number of Shares which
may be purchased or acquired pursuant to Stock Options and/or Stock
Appreciation Rights granted under the Plan, either in the aggregate or for
any Participant or eligible Employee, except as contemplated in Article X;
(ii) expand the class of employees eligible to receive Stock Options and/or
Stock Appreciation Rights under the Plan; (iii) decrease the minimum Stock
Option exercise price; (iv) extend the maximum term of Stock Options and/or
Stock Appreciation Rights granted hereunder; (v) extend the term of the Plan;
or (vi) take any other action requiring stockholder approval under Rule 16b-3
under the Exchange Act. No amendment or modification may become effective if
it would cause the Plan to fail to meet the applicable requirements of Rule
16b-3.
ARTICLE XV. SHAREHOLDER APPROVAL
--------------------
Anything in the Plan to the contrary notwithstanding, the grant of Stock
Options and/or Stock Appreciation Rights hereunder shall be of no force or
effect, and no Stock Option and/or Stock Appreciation
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Right granted hereunder shall vest or become exercisable in any respect,
unless and until the Plan is approved by the affirmative vote of the holders
of a majority of the Shares present, in person or by proxy, and entitled to
vote at a meeting of the shareholders of the Corporation duly held in
accordance with the laws of New Jersey.
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APPENDIX B
----------
GREAT FALLS BANCORP
1996 STOCK OPTION PLAN
FOR NONEMPLOYEE DIRECTORS
ARTICLE I. PURPOSES
--------
The purposes of the Great Falls Bancorp 1996 Stock Option Plan for
Nonemployee Directors (the "Plan") are to (i) attract and retain highly
qualified nonemployee directors of Great Falls Bank and Bergen Commercial
Bank (the "Bank Subsidiaries"), which are the bank subsidiaries of Great
Falls Bancorp (the "Corporation"), (ii) align the long-term interests of
nonemployee directors of the Bank Subsidiaries and the Corporation's
stockholders by creating a direct link between compensation of nonemployee
directors and stockholder return, (iii) enable nonemployee directors of the
Bank Subsidiaries to develop and maintain stock ownership positions in the
Corporation, and (iv) provide incentives to such nonemployee directors to
contribute to the Corporation's success. To achieve these objectives, the
Plan provides for the granting of "nonqualified stock options" to the
nonemployee directors of the Bank Subsidiaries.
ARTICLE II. DEFINITIONS
-----------
Whenever the following terms are used in this Plan, they shall have the
meanings specified below:
(a) "AFFILIATE" shall mean the Corporation or a Subsidiary.
(b) "BANK SUBSIDIARIES" means Great Falls Bank and Bergen Commercial Bank,
both of which are banking corporations of the State of New Jersey and
Subsidiaries of the Corporation. "BANK SUBSIDIARY" means either Great Falls
Bank or Bergen Commercial Bank, as the context may require.
(c) "BOARD" shall mean the Board of Directors of the Corporation.
(d) "CAUSE" shall mean (i) the conviction of the Participant of a felony
by a court of competent jurisdiction, (ii) the indictment of the Participant
by a State or Federal grand jury of competent jurisdiction for embezzlement
or misappropriation of funds of an Affiliate or for any act of dishonesty or
lack of fidelity towards an Affiliate, (iii) the written confession by the
Participant of any act of dishonesty towards an Affiliate or any embezzlement
or misappropriation of an Affiliate's funds, or (iv) willful or gross neglect
of the duties for which the Participant was responsible, all as the Board, in
its sole discretion, may determine.
(e) "CHANGE IN CONTROL" shall mean the occurrence of one or more of the
following events: (i) the Corporation acquires actual knowledge that any
person (as such term is used in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act) other than an Affiliate is or becomes the beneficial owner (as
defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of
securities of the Corporation representing more than 25% of the combined
voting power of the Corporation's then outstanding securities; (ii) the first
purchase of Common Stock pursuant to a tender or exchange offer (other than a
tender or exchange offer made by an Affiliate); (iii) the approval by the
Corporation's stockholders of (a) a merger or consolidation of the
Corporation with or into another corporation (other than a merger or
consolidation in which the Corporation is the surviving corporation and which
does not result in any reclassification or reorganization of the
Corporation's then outstanding shares of Common Stock or a change in the
Corporation's directors, other than the addition of not more than three
directors), (b) a sale or disposition of all or substantially all of the
Corporation's assets, or (c) a plan of liquidation or dissolution of the
Corporation; (iv) during any period of two consecutive calendar years,
individuals who at the beginning of such period constitute the Board cease
for any reason to constitute at least two-thirds thereof, unless the election
or nomination for the election by the Corporation's stockholders of each new
director was approved by a vote of at least two-thirds of the directors then
still in office who were directors at the beginning of the period; or (v) a
sale of (a) Common Stock of the Corporation if after such sale any person (as
defined above) other than an Affiliate owns a
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majority of the Common Stock or (b) all or substantially all of the
Corporation's assets (other than in the ordinary course of business).
(f) "CODE" shall mean the Internal Revenue Code of 1986, as now in effect
or as hereafter amended. (All citations to sections of the Code are to such
sections as they may from time to time be amended or renumbered.)
(g) "COMMON STOCK" shall mean the common stock of the Corporation, par
value $1.00 per share.
(h) "CORPORATION" shall mean Great Falls Bancorp, a New Jersey business
corporation.
(i) "DISABILITY" shall mean permanent and total disability as defined by
the Corporation's employee welfare benefit plan offering a long-term
disability benefit, or, if no such benefit is offered, as defined by Section
105(d)(4) of the Code (prior to the repeal of such Section). "Disability"
shall also exist if documented by a signed written opinion of a currently
licensed medical doctor reasonably satisfactory to the Board, which written
opinion shall set forth, without limitation, a medical opinion that the
Participant is permanently disabled, the reasons for such disability, and the
date of commencement of such disability.
(j) "EMPLOYEE" shall mean a common law employee (as defined in accordance
with the regulations and Revenue Rulings then applicable under Section
3401(c) of the Code) of an Affiliate.
(k) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as now
in effect or as hereafter amended.
(l) "FAIR MARKET VALUE OF STOCK" shall mean for all purposes of the Plan
as follows: (A) if the Shares are admitted to quotation on the National
Association of Securities Dealers Automated Quotation System ("NASDAQ") or
other comparable quotation system and have been designated as a National
Market System ("NMS") security, fair market value on any date shall be the
last sale price reported for the Shares on such system on such date or on the
last day preceding such date on which a sale was reported; (B) if the Shares
are admitted to quotation on NASDAQ and have not been designated an NMS
security, fair market value on any date shall be the average of the highest
bid and lowest asked prices of the Shares on such system on such date; (C) if
the Shares are admitted to trading on a national securities exchange, fair
market value on any date shall be the last sale price reported for the Shares
on such exchange on such date or on the last date preceding such date on
which a sale was reported; or (D) if neither (A), (B) nor (C) applies to the
Shares, fair market value on any date shall be a price equal to the mean
between the closing bid and asked prices for Shares, as quoted in writing to
the Corporation by Ryan, Beck & Co., Inc., a principal market maker for
transactions in the Corporation's Common Stock on the over-the-counter
market, or other market maker designated by the Board.
(m) "PARTICIPANT" shall mean any one of the individuals who was a member
of the Board of Directors of either of the Bank Subsidiaries on February 20,
1996 provided such individual was not also an Employee on such date.
(n) "PLAN" shall mean the Great Falls Bancorp 1996 Stock Option Plan for
Nonemployee Directors, as may be amended from time to time.
(o) "SECRETARY" shall mean the corporate secretary of the Corporation.
(p) "SECURITIES ACT" shall mean the Securities Act of 1933, as now in
effect or as hereafter amended.
(q) "SHARES" shall mean shares of Common Stock.
(r) "STOCK OPTION" shall mean a right to purchase Common Stock which is
awarded in accordance with the terms of this Plan.
(s) "SUBSIDIARY(IES)" shall mean any corporation or other legal entity,
domestic or foreign, more than 50% of the voting power of which is owned or
controlled, directly or indirectly by the Corporation.
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(t) "TERMINATE (TERMINATION OF) SERVICE (OR TERMINATION)" shall mean the
time at which the Participant ceases to provide services to an Affiliate as a
director or an Employee, but shall not include a lapse in providing services
which the Board determines to be a temporary leave of absence.
ARTICLE III. ADMINISTRATION
--------------
The Plan shall be administered by the Board. No member of the Board shall
be personally liable for any action, determination or interpretation made in
good faith with respect to the Plan or any Stock Option granted pursuant
thereto. All members of the Board shall be indemnified by the Corporation
with respect to any such action, determination or interpretation to the
fullest extent permitted by law.
The Board is authorized, subject to the provisions of the Plan, to: (i)
grant Stock Options to the respective Participants to purchase the respective
numbers of Shares indicated in Article VI of this Plan, either following
approval of the adoption of the Plan by the Corporation's shareholders or
prior to shareholder approval but subject to subsequent approval of the Plan
by the Corporation's shareholders; (ii) determine the exercise price of the
Shares subject to each Stock Option, which price shall be not less than the
minimum specified in Section 6.1; (iii) determine who is a "nonemployee
director" of a Bank Subsidiary eligible to be a Participant; (iv) establish
such rules and regulations as it deems necessary for the proper
administration of the Plan; and (v) make whatever determinations and
interpretations in connection with the Plan as it deems necessary or
advisable. All determinations and interpretations made by the Board shall be
binding and conclusive on all Participants and on their legal representatives
and beneficiaries.
The provisions of this Article III shall survive any termination of the
Plan.
ARTICLE IV. SHARES SUBJECT TO PLAN
----------------------
The aggregate maximum number of Shares that may be made subject to Stock
Options granted pursuant to the Plan is Ninety-Five Thousand (95,000) (or the
number and kind of Shares or other securities which are substituted for those
Shares or to which those Shares are adjusted pursuant to the provisions of
Article VIII of the Plan). The Corporation shall reserve such number of
Shares for the purposes of the Plan out of its authorized but unissued
shares, or out of Shares held in the Corporation's treasury, or partly out of
each, as shall be determined by the Board. No fractional Shares shall be
issued with respect to Stock Options granted under the Plan.
In the event that any outstanding Stock Option under the Plan for any
reason expires, is terminated, forfeited or is canceled at any time, the
shares subject to such Options will be unavailable for future grants under
the Plan.
ARTICLE V. ELIGIBILITY FOR AWARD OF STOCK OPTIONS
--------------------------------------
Only a Participant (as defined in paragraph (m) of Article II) shall be
eligible to be granted Stock Options; provided, however, that a Participant
shall not be eligible unless such Participant is still a nonemployee director
of one of the Bank Subsidiaries on the date Stock Options are granted by the
Board under the Plan.
ARTICLE VI. GRANT OF STOCK OPTIONS
----------------------
Each Participant other than Anthony M. Bruno, Jr. shall be eligible to be
granted Stock Options to purchase Three Thousand (3,000) Shares on the terms
and conditions set forth in this Article VI. Anthony M. Bruno, Jr. shall be
eligible to be granted Stock Options to purchase Fifty Thousand (50,000)
Shares on the terms and conditions set forth in this Article VI. Stock
Options shall be evidenced by Stock Option agreements in such form as the
Board approves. Stock Option agreements shall conform to the provisions of
the Plan and shall be identical for all Participants except as necessary
solely to reflect differences in the number of shares covered by the Stock
Options.
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<PAGE>
6.1 OPTION PRICE OF STOCK OPTIONS. The exercise price for each Stock Option
granted under the Plan shall be equal to the Fair Market Value of the Stock
on the date of grant.
6.2 VESTING, EXERCISABILITY AND TERMS OF STOCK OPTIONS.
(a) Stock Options will become "vested" at the rate of 20% per year (10,000
Shares per year for Mr. Bruno and 600 Shares per year for each of the
Participants other than Mr. Bruno) commencing on the date of grant and
continuing on each January 1 thereafter on which the Participant remains a
director of a Bank Subsidiary and/or a director of an Affiliate and/or
Employee of an Affiliate.
(b) Each group of "vested" Stock Options will thereafter become
exercisable at the rate of 20% per year commencing on the later of (a) six
(6) months and one day after the date the Stock Options are granted or (b)
January 1st after each vesting date.
(c) All Stock Options will generally lapse on December 31, 2006 to the
extent not fully exercised prior thereto.
(d) Upon the Termination of Service of a Participant due to voluntary
resignation or involuntary removal without Cause, all Stock Options which
have not become exercisable before the date the Participant Terminates
Service shall be forfeited and terminated immediately. The Participant may
exercise a Stock Option to the extent it was exercisable by him on the date
immediately preceding such Termination within the lesser of (i) one month
from the date of Termination (six months from the date of Termination in the
case of voluntary resignation), or (ii) the balance of the stated term of the
Stock Option. If a Participant shall be removed as a director of an
Affiliate for Cause, all Stock Options granted to such Participant that have
not been exercised prior to such Termination for Cause shall, whether or not
exercisable, be forfeited immediately upon such Termination.
6.3 ACCELERATED VESTING AND EXERCISABILITY OF STOCK OPTIONS. If a
Participant shall Terminate Service by reason of his death or Disability, all
Stock Options granted to such Participant which have not become exercisable
on or before the date of such Termination shall immediately become both
"vested" and fully exercisable. All Stock Options held by such Participant
may be exercised by the Participant, his estate or beneficiary, or his
representative, as the case may be, for a period of one year from the date of
such Termination, or until the expiration of the stated term of such Stock
Options, whichever period is shorter.
Notwithstanding the provisions of Section 6.2, in the event of a Change in
Control, any Stock Option granted under the Plan to a Participant which has
not, as of the date of the Change in Control, become exercisable shall
immediately become both "vested" and fully exercisable.
6.4 NONTRANSFERABILITY OF STOCK OPTIONS. No Stock Option shall be
transferable except by will or the laws of descent and distribution. During
the Participant's lifetime, the Stock Option shall be exercisable only by him
or, in the event of the Participant's incapacity or death, by the
Participant's guardian or legal representative. More specifically, without
limitation, no Stock Option may be assigned, transferred (except as
specifically permitted by the Plan or the terms of the specific Stock Option
agreement consistent with the Plan), pledged or hypothecated in any way, nor
shall it be assignable by operation of law or subject to execution,
attachment, garnishment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of a Stock Option
contrary to the provisions hereof, and the levy of any execution, attachment,
garnishment or similar process upon the Stock Option, shall be null and void,
and without force or effect. The Board may, however, in its sole discretion,
allow for transfers of Stock Options to family members, subject to such
conditions or limitations as the Board may establish to ensure compliance
with Rule 16b-3 promulgated pursuant to the Exchange Act, or for other
purposes.
6.5 NO OBLIGATION TO EXERCISE STOCK OPTIONS. The grant of a Stock Option
shall impose no obligation on the Participant to exercise such Stock Option.
6.6 CANCELLATION OF STOCK OPTIONS. The Board in its discretion may, with
the consent of any Participant, cancel any outstanding Stock Option.
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<PAGE>
6.7 NO RIGHTS AS A STOCKHOLDER. A Participant or a transferee of a Stock
Option shall have no rights as a stockholder with respect to any Share
covered by his Stock Option until he shall have become the holder of record
of such Share, and he shall not be entitled to any dividends or distributions
or other rights in respect of such Share for which the record date is prior
to the date on which he shall have become the holder of record thereof.
6.8 DEFERRED EXERCISE OF STOCK OPTIONS. If a Participant's timely exercise
of a Stock Option during a given taxable year, together with any other
compensation paid to the Participant for such year, would result in a
disallowance for Federal income tax purposes, pursuant to Section 402(m) of
the Code, of a deduction to the Corporation of all or part of the
Participant's income to be recognized during such taxable year for Federal
income tax purposes upon such exercise, then such Participant's exercise of
such Stock Option shall be ineffective and such exercise shall be
automatically deferred (except to the extent specifically permitted by the
Board) beyond the end of such taxable year of the Corporation to the extent
necessary to avoid such disallowance of a deduction to the Corporation. The
deferral of exercise of a Stock Option provided by this Section 6.9 shall be
until the next succeeding taxable year in which the Corporation is not denied
a tax deduction related to such exercise. The deferral of exercise is for
the Corporation's benefit and therefore supersedes any other limitation on
exercisability which may be set forth in any other provision of this Plan or
any Stock Option agreement.
ARTICLE VII. EXERCISE OF STOCK OPTIONS
-------------------------
Any Stock Option may be exercised in whole or in part at any time
subsequent to such Stock Option's becoming exercisable during the term of
such Stock Option; provided, however, that each partial exercise shall be for
whole Shares only. Each Stock Option, or any exercisable portion thereof,
may only be exercised by delivery to the Secretary or his office of (i)
notice in writing signed by the Participant (or other person then entitled to
exercise such Stock Option) that such Stock Option, or a specified portion
thereof, is being exercised; (ii) payment in full for the purchased Shares
(as specified in Section 7.2 below); (iii) such representations and documents
as are necessary or advisable to effect compliance with all applicable
provisions of Federal or State securities laws or regulations; (iv) in the
event that the Stock Option or portion thereof shall be exercised pursuant to
Section 6.3 or 6.4 by any person or persons other than the Participant,
appropriate proof of the right of such person or persons to exercise the
Stock Option or portion thereof; and (v) full payment to the Corporation of
all amounts which, under Federal or State law, it is required to withhold
upon exercise of the Stock Option (as specified in Section 7.3 below).
7.1 SHARE CERTIFICATES. Upon receiving notice and payment, the Corporation
will cause to be delivered to the Participant, as soon as practicable, a
certificate in the Participant's name for the Shares purchased. The Shares
issuable and deliverable upon the exercise of a Stock Option shall be fully
paid and nonassessable. The Corporation shall not be required to issue or
deliver any certificate or certificates for Shares purchased upon the
complete or partial exercise of the Stock Option prior to fulfillment of (i)
the completion of any registration or other qualification of such Shares
under any Federal or State law or under rulings or regulations of the
Securities and Exchange Commission or of any other governmental regulatory
body which may be necessary or advisable; and (ii) the obtaining of any
approval or other clearance from any Federal or State governmental agency
which may be necessary or advisable.
7.2 PAYMENT FOR SHARES. Payment for Shares purchased under a Stock Option
granted hereunder shall be made in full upon exercise of the Stock Option,
(i) by certified or bank cashier's check payable to the order of the
Corporation, (ii) in the form of Shares already owned by the Participant
based in any such instance on the Fair Market Value of the Stock on the date
the Stock Option is exercised, or (iii) by a combination of cash and Shares
already owned. To the extent the Stock Option exercise price is paid in
Shares as provided above, Shares delivered by the Participant may be Shares
which were received by the Participant upon exercise of one or more Stock
Options, but only if such Shares have been held by the Participant for at
least six months.
7.3 SHARE WITHHOLDING. The Board shall require that a Participant pay to
the Corporation, at the time of exercise of a Stock Option, such amount as
the Board deems necessary to satisfy the Corporation's obligation, if any, to
withhold Federal or State income or other taxes incurred by reason of the
exercise or the transfer of Shares thereupon. A Participant may satisfy such
withholding requirements by having the
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<PAGE>
Corporation withhold from the number of Shares otherwise issuable upon
exercise of the Stock Option that number of shares having an aggregate fair
market value on the date of exercise equal to the minimum amount required by
law to be withheld; provided, however, that in the case of an exercise by a
Participant who is subject to Section 16(b) of the Exchange Act, such
Participant must (i) exercise the Stock Option during the period beginning on
the third business day following the date of release to the press of the
quarterly or annual summary of earnings for the Corporation, and ending on
the twelfth business day following such date, or (ii) irrevocably elect to
utilize Share withholding at least six months prior to the date of exercise.
7.4 LOANS. The Corporation may make loans to such Participants as the
Board, in its discretion, may determine in connection with the exercise of
Stock Options granted under the Plan. Such loans shall be subject to the
following terms and conditions and such other terms and conditions as the
Board shall determine not inconsistent with the Plan. Any such loan must
bear interest at a rate, and otherwise be on repayment terms, which are not
more favorable to the Participant than comparable loans by the Bank
Subsidiaries to unrelated customers at the time the loan is made. In no
event may the principal amount of any such loan exceed the exercise price, at
the date of exercise, of the Shares covered by the Stock Option or portion
thereof exercised by the Participant. When a loan shall have been made, the
Board shall require that Shares of Common Stock and/or other collateral
having a value at least equal to the amount of the loan having a fair market
value at least equal to the principal amount of the loan shall be pledged by
the Participant to the Corporation as security for payment of the unpaid
balance of the loan. Every such loan shall also comply with all applicable
laws, regulations and rules of the Board of Governors of the Federal Reserve
System and any other governmental agency having jurisdiction thereof.
ARTICLE VIII. ADJUSTMENT FOR RECAPITALIZATION, ETC.
-------------------------------------
The aggregate number of Shares which may be purchased under the Plan
pursuant to Stock Options, the number of Shares covered by each outstanding
Stock Option, and the exercise price of each Stock Option shall be
appropriately adjusted for any increase or decrease in the number of
outstanding Shares resulting from a stock split or other subdivision or
consolidation of Shares or for other capital adjustments or payments of stock
dividends or distributions, other increases or decreases in the outstanding
Shares effected without receipt of consideration by the Corporation, or
reorganization, merger or consolidation, or other similar change affecting
the Shares.
Such adjustment to a Stock Option shall be made without a change to the
total exercise price applicable to the unexercised portion of the Stock
Option (except for any change in the aggregate price resulting from rounding-
off of Share quantities or prices). Any such adjustment made by the Board
shall be final and binding upon all Participants, the Corporation, their
representatives, and all other interested persons. No fractional Shares
shall be issued as a result of such adjustment.
In the event of a transaction involving (i) the liquidation or dissolution
of the Corporation, (ii) a merger or consolidation in which the Corporation
is not the surviving corporation or (iii) the sale or disposition of all or
substantially all of the Corporation's assets, provision shall be made in
connection with such transaction for the assumption of Stock Options
theretofore granted under the Plan, or the substitution for such Stock
Options of new Stock Options of the successor corporation, with appropriate
adjustment as to the number and kind of Shares and the purchase price for
Shares thereunder, or, in the discretion of the Board, the Plan and the Stock
Options issued hereunder shall terminate on the effective date of such
transaction if appropriate provision is made for payment to the Participant
of an amount in cash equal to the fair market value of a Share multiplied by
the number of Shares subject to the Stock Options (to the extent such Stock
Options have not been exercised) less the exercise price for such Stock
Options (to the extent such Stock Options have not been exercised); provided,
however, that in no event shall the Board take any action or make any
determination under this Article VIII which would prevent a transaction
described in clause (ii) or (iii) above from being treated as a pooling of
interests under generally accepted accounting principles.
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ARTICLE IX. GOVERNMENT REGULATIONS AND REGISTRATION OF SHARES
-------------------------------------------------
The Plan, and the grant and exercise of Stock Options thereunder, and the
Corporation's obligation to sell and deliver Shares, shall be subject to all
applicable Federal and State laws, rules and regulations and to such
approvals by any regulatory or governmental agency as may be required.
Each Stock Option is subject to the requirement that if, at any time, the
Board determines, in its absolute discretion, that the listing, registration
or qualification of Shares issuable pursuant to the Plan is required by any
securities exchange or NASDAQ or under any State or Federal law, or the
consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the issuance of Shares,
no Shares shall be issued, in whole or in part, unless such listing,
registration, qualification, consent or approval has been effected or
obtained, free of any conditions not acceptable to the Board. The
Corporation shall not be deemed, by reason of the granting of any Stock
Option, to have any obligation to register the Shares subject to such Stock
Option under the Securities Act or to maintain in effect any registration of
such Shares which may be made at any time under the Securities Act.
Unless a registration statement under the Securities Act and the
applicable rules and regulations thereunder is then in effect with respect to
Shares issued upon exercise of any Stock Option (which registration shall not
be required), the Corporation shall require that the offer and sale of such
Shares be exempt from the registration provisions of said Act. In
furtherance of such exemption, the Corporation may require, as a condition
precedent to the exercise of any Stock Option, that the person exercising the
Stock Option give to the Corporation written representation and undertaking,
satisfactory in form and substance to the Corporation, that he is acquiring
the Shares for his own account for investment and not with a view to the
distribution or resale thereof and otherwise establish to the Corporation's
satisfaction that the offer or sale of the Shares issuable upon exercise of
the Stock Option will not constitute or result in any breach or violation of
the Securities Act or any similar State act or statute or any rules or
regulations thereunder. In the event a Registration Statement under the
Securities Act is not then in effect with respect to the Shares issued upon
exercise of a Stock Option, the Corporation shall place upon any stock
certificate an appropriate legend referring to the restrictions on
disposition under the Securities Act.
The Corporation is relieved from any liability for the nonissuance or
nontransfer or any delay in issuance or transfer of any Shares subject to
Stock Options under the Plan which results from the inability of the
Corporation to obtain, or in any delay in obtaining, from any regulatory body
having jurisdiction, all requisite authority to issue or transfer Shares upon
exercise of the Stock Options under the Plan if counsel for the Corporation
deems such authority necessary for lawful issuance or transfer of any such
Shares. Appropriate legends may be placed on the stock certificates
evidencing Shares issued upon exercise of Stock Options to reflect such
transfer restrictions.
ARTICLE X. OTHER PROVISIONS
----------------
The validity, interpretation and administration of the Plan and any rules,
regulations, determinations or decisions made thereunder, and the rights of
any and all persons having or claiming to have any interest therein or
thereunder, shall be determined exclusively in accordance with the laws of
the State of New Jersey.
As used herein, the masculine gender shall include the feminine gender.
The headings in the Plan are for reference purposes only and shall not
affect the meaning or interpretation of the Plan.
All notices or other communications made or given pursuant to this Plan
shall be in writing and shall be sufficiently made or given if hand-delivered
or mailed by certified mail, addressed to any Participant at the address
contained in the records of the Corporation or to the Corporation at its
principal office.
The proceeds received from the sale of Shares pursuant to the Plan shall
be used for general corporate purposes.
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<PAGE>
Nothing in the Plan or in any Stock Option granted hereunder shall confer
on any Participant any right to continue as, or to become, a director or
Employee of any Affiliate, or to interfere in any way with the right of the
Corporation or any of its Subsidiaries to terminate such Participant's status
as an Employee or as a director of any Subsidiary at any time, subject to the
Participant's contract rights, if any, and applicable law.
The Plan is intended to comply with Rule 16b-3 promulgated under the
Exchange Act and the Board shall interpret and administer the provisions of
the Plan or any Stock Option in a manner consistent therewith. Any
provisions inconsistent with such Rule shall be inoperative and shall not
affect the validity of the Plan.
All expenses and costs incurred in connection with the operation of the
Plan shall be borne by the Corporation.
The adoption of this Plan shall not affect any other compensation or
incentive plans in effect for the Affiliates, or any of them. Nothing in
this Plan shall be construed to limit the right of any Affiliate (i) to
establish, alter or terminate any other forms of incentives, benefits or
compensation for directors and/or Employees, including, without limitation,
conditioning the right to receive other incentives, benefits or compensation
on an individual's not participating in this Plan; or (ii) to grant or assume
options otherwise than under this Plan in connection with any proper
corporate purpose, including, without limitation, the grant or assumption of
stock options in connection with the acquisition by purchase, lease, merger,
consolidation or otherwise, of the business, stock, or assets of any
corporation, firm or association.
Participants shall have no rights as shareholders unless and until
certificates for Shares are registered in their names in satisfaction of a
properly exercised Stock Option.
If the Board shall find that any person to whom any benefit is due or
payable under the Plan is unable to care for his affairs because of illness
or accident, or is a minor, or has died, then any payment due to such person
or his estate (unless a prior claim therefor has been made by a duly
appointed legal representative), may, if the Board so determines, be paid to
his spouse, child, relative, an institution maintaining or having custody of
such person, or any other person deemed by the Board to be a proper recipient
on behalf of such person otherwise entitled to payment. Any such payment
shall be a complete discharge of the liability of the Board and the
Corporation therefor.
ARTICLE XI. EFFECTIVE DATE AND EXPIRATION DATE OF PLAN
------------------------------------------
The Plan is effective as of such date as it is approved by the
stockholders of the Corporation in a manner which complies with Rule 16b-3
under the Exchange Act and applicable State law.
ARTICLE XII. AMENDMENT OR DISCONTINUANCE OF PLAN
-----------------------------------
The Board may, without the consent of the Corporation's stockholders or
Participants under the Plan, at any time terminate the Plan entirely, and at
any time or from time to time amend or modify the Plan, provided that no such
action shall adversely affect Stock Options theretofore granted hereunder
without the Participant's consent, and provided further that no such action
by the Board, without approval of the stockholders, may (i) increase the
total number of Shares which may be purchased or acquired pursuant to Stock
Options granted under the Plan, either in the aggregate or for any
Participant or eligible nonemployee director, except as contemplated in
Article VIII; (ii) expand the class of individuals eligible to receive Stock
Options under the Plan; (iii) decrease the minimum Stock Option exercise
price; (iv) extend the maximum term of Stock Options granted hereunder; or
(v) take any other action requiring stockholder approval under Rule 16b-3
under the Exchange Act. No amendment or modification may become effective if
it would cause the Plan to fail to meet the applicable requirements of Rule
16b-3.
ARTICLE XIII. SHAREHOLDER APPROVAL
--------------------
Anything in the Plan to the contrary notwithstanding, the grant of Stock
Options hereunder shall be of no force or effect, and no Stock Option granted
hereunder shall vest or become exercisable in any respect,
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<PAGE>
unless and until the Plan is approved by the affirmative vote of the holders
of a majority of the Shares present, in person or by proxy, and entitled to
vote at a meeting of the shareholders of the Corporation duly held in
accordance with the laws of New Jersey.
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X Please mark your votes as in this example 9406
This proxy when properly executed will be voted in the manner directed herein
by the undersigned stockholder. If no direction is made, this Proxy will be
voted FOR Proposal 1, 2, 3, 4 and 5 and the Proxies will be authorized to vote
this Proxy in their discretion upon such other business as may properly come
before the meeting.
1. ELECTION OF DIRECTORS:
[ ] FOR [ ] WITHHELD
For, except vote withheld from following nominees(s): __________________
2. APPROVAL OF AMENDMENT TO CERTIFICATE OF INCORPORATION CHANGING CORPORATE
NAME TO GREATER COMMUNITY BANCORP
-------------------------
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. APPROVAL OF AMENDMENT TO CERTIFICATE OF INCORPORATION INCREASING AUTHORIZED
COMMON STOCK TO 10 MILLION SHARES
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. APPROVAL OF PROPOSED 1996 EMPLOYEE STOCK OPTION PLAN
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. APPROVAL OF PROPOSED 1996 STOCK OPTION PLAN FOR NONEMPLOYEE DIRECTORS
[ ] FOR [ ] AGAINST [ ] ABSTAIN
6. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
SIGNATURE(S) The signer hereby revokes all
proxies heretofore given by the
signer to vote at said meeting
or any adjournments thereof. The
signer hereby confers discretion
to the proxies to vote upon such
NOTE: PLEASE SIGN EXACTLY AS NAME APPREARS other natters as may properly
HEREON. JOINT OWNERS SHOULD EACH SIGN. WHEN come before the meeting.
SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR,
TRUSTEEE OR GUARDIAN, PLEASE GIVE FULL TITLE
AS SUCH.
<PAGE>
GREAT FALLS BANCORP
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS ON APRIL 30, 1996
The undersigned hereby appoints Toby W. Giardiello, Naqi A. Naqvi and Robin A.
Peterson, and each of them, as the undersigned's true and lawful agents and
proxies with full power of substitution in each, to represent the undersigned at
the Annual Meeting of Stockholders of GREAT FALLS BANCORP to be held at the main
office of Great Falls Bank, 55 Union Boulevard, Totowa, New Jersey on Tuesday,
April 30, 1996 at 4:00 p.m., and at any adjournment thereof, on all matters
coming before such meeting.
Election of Directors, Nominees:
JOSEPH A. LOBOSCO, JOHN L. SOLDOVERI, C. MARK CAMPBELL AND CHARLES J. VOLPE
(three-year term)
ANTHONY M. BRUNO, JR. (two-year term)
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE BOXES, SEE
REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES IF YOU WISH TO VOTE IN ACCORDANCE
WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS. THE ABOVE PROXIES CANNOT VOTE
YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD.
