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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)
Cooperative Bankshares, Inc.
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(Name of Issuer)
Common Stock, par value $1.00 per share
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(Title of Class of Securities)
216844 10 0
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(CUSIP Number)
Frederick Willetts, III
Cooperative Bank for Savings, Inc., SSB
201 Market Street
P.O. Box 600
Wilmington, North Carolina 28402-0600
(919) 343-0181
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(Name, address and telephone number of person
authorized to receive notices and communications)
June 10, 1998
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(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the subject of
this Schedule 13D, and is filing this schedule because of Rule
13d-1(b)(3) or (4), check the following box. [ ]
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CUSIP No. 216844 10 0 Page 1 of 7 Pages
1. Name of reporting person: Frederick Willetts, III
SSN of reporting person: ###-##-####
2. Check the appropriate box if a member of a group:
(a) [ ]
(b) [ X ]
3. SEC use only:
4. Sources of funds: PF, OO
5. Check box if disclosure of legal proceedings is required
pursuant to Items 2(d) or 2(e): [ ]
6. Citizenship or place of organization: United States
Number of 7. Sole Voting Power: 115,216
shares
beneficially 8. Shared Voting Power: 150,606
owned by
each 9. Sole Dispositive Power: 115,216
reporting
person with 10. Shared Dispositive Power: 150,606
11. Aggregate amount beneficially owned by each reporting
person: 265,822
12. Check box if the aggregate amount in Row 11 excludes
certain shares: [ ]
13. Percent of class represented by amount in Row 11: 9.0%
14. Type of reporting person: IN
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CUSIP NO. 216844 10 0 Page 2 of 7 Pages
The undersigned hereby amends the Schedule 13D filing made
on September 19, 1994 (the "Schedule 13D"), as amended by
amendment #1 on February 20, 1996, pursuant to Rule 13d-2(a)
under the Securities Exchange Act of 1934, as amended, as set
forth below.
Item 1. Security and Issuer
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The class of equity securities to which this statement
relates is the common stock, par value $1.00 per share (the
"Common Stock"), of Cooperative Bankshares, Inc. (the "Issuer").
The executive office of the Issuer is located at 201 Market
Street, P.O. Box 600, Wilmington, North Carolina 28402-0600.
Item 2. Identity and Background
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(a) Name: Frederick Willetts, III
(b) Address: 201 Market Street, P.O. Box 600, Wilmington,
North Carolina 28402-0600
(c) Present Principal Occupation: Director, President, and
Chief Executive Officer of the Issuer
(d) Criminal Proceeding Convictions: None
(e) Securities Laws Proceedings: None
(f) Citizenship: United States
Item 3. Source and Amount of Funds or Other Consideration.
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All shares shown as to which the reporting person has sole
voting and dispositive power were purchased with the reporting
person's personal funds except for 500 shares that he received
as a gift and 1,500 shares owned by trusts established for the
reporting person's children, for which he became the trustee on
May 21, 1998. Beneficial ownership for the shares shown as to
which the reporting person has shared voting and dispositive
power were acquired without payment as follows: the reporting
person became beneficial owner of 59,460 shares (inclusive of <PAGE>
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CUSIP NO. 216844 10 0 Page 3 of 7 Pages
13,332 shares subject to exercisable stock options) when he was
appointed co-executor of his father's estate on June 10, 1998,
the reporting person is also beneficial owner of 70,310 shares
as a trustee of his father's trust, 1,404 shares owned by his
spouse, 414 shares owned by his minor children, 11,605 shares
allocated to his account under the Issuer's Employee Stock
Ownership Plan (the "ESOP"), and 7,413 unallocated shares under
the Issuer's ESOP of which his is a trustee.
Item 4. Purpose of Transaction
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The shares covered by this statement are being held for
investment purposes. Depending upon a continuing assessment,
and upon future developments, the reporting person may
determine, from time to time or at any time, to purchase
additional shares of the Issuer for investment or dispose of
shares of the Issuer's Common Stock. As President and Chief
Executive Officer of the Issuer, Mr. Willetts regularly explores
potential actions and transactions which may be advantageous to
the Issuer, including possible mergers, acquisition,
reorganizations or other material change in the business,
corporate structure, management policies, governing instruments,
securities or regulatory or reporting obligations of the Issuer.
Mr. Willetts as trustee of his father's trust and co-executor of
his father's estate will be disposing of shares in accordance
with his role as trustee and executor, respectively. Except as
noted above with respect to Mr. Willetts' activities on behalf
of the Issuer, Mr. Willetts has no plans or proposals which
relate to or would result in:
(a) the acquisition by any person of additional shares of
the Issuer, or the disposition of securities of the Issuer,
except as described above;
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CUSIP NO. 216844 10 0 Page 4 of 7 Pages
(b) an extraordinary corporate transaction, such as a
merger, reorganization or liquidation, involving the Issuer or
any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of
the Issuer or any of its subsidiaries;
(d) any change in the present board of directors or
management of the Issuer, including any plans or proposals to
change the number or term of directors or to fill any existing
vacancies on the board;
(e) any material change in the present capitalization or
dividend policy of the Issuer;
(f) any other material change in the Issuer's business or
corporate structure;
(g) changes in the Issuer's Charter or Bylaws or other
actions which may impede the acquisition of control of the
Issuer by any person;
(h) causing a class of securities of the Issuer to be
delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a
registered national securities association;
(i) a class of equity securities of the Issuer becoming
eligible for termination of registration pursuant to Section
12(g)(4) of the Securities Exchange Act; or
(j) any action similar to any of those enumerate above.
The reporting person reserves the right to change his
investment purpose with respect to any and all shares of the
Common Stock beneficially owned and to take any and all lawful
action with respect to such shares.
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CUSIP NO. 216844 10 0 Page 5 of 7 Pages
Item 5. Interest in Securities of the Issuer
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(a) The aggregate number of shares beneficially owned by
the reporting person is 265,822, constituting 9.0% of the
outstanding shares of Common Stock. Included in this amount are
71,414 shares which the reporting person has the right to
acquire under the stock option plan of the Issuer.
(b) The reporting person has sole voting and dispositive
power over all such shares, except with respect to 1,818 shares
owned by the reporting person's spouse and minor children, as to
which voting and dispositive power is shared, 11,605 shares
allocated to the reporting person's account under the ESOP, as
to which voting and dispositive power is shared with the
trustees of the ESOP, and 7,413 shares which remain unallocated
under the Issuer's ESOP, as to which the reporting person shares
voting power in his capacity as trustee of the ESOP. Trustees
of the ESOP must vote all allocated shares held in the ESOP in
accordance with the instruction of the participating employees.
Unallocated shares and shares for which no participant direction
has been given are voted by the ESOP Trustees as directed by the
ESOP committee. Trustees of the ESOP must vote all allocated
shares held in the ESOP in accordance with the instructions of
the participating employees. Also included are 70,310 shares
owned by the Frederick Willetts, Jr. Trust, of which the
reporting person is a trustee, and 59,460 shares owned by the
estate of Frederick Willetts, Jr., of which the reporting person
became a co-executor on June 10, 1998.
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CUSIP NO. 216844 10 0 Page 6 of 7 Pages
(c) The reporting person became beneficial owner of
59,460 shares on June 10, 1998 when he was named co-executor of
his father's estate. The reporting person became beneficial
owner of 1,500 shares owned by trusts established for the
reporting person's children, for which he became trustee on May
21, 1998.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer
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Not applicable.
Item 7. Material to be Filed as Exhibits
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None.
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CUSIP NO. 216844 10 0 Page 7 of 7 Pages
SIGNATURE
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After reasonable inquiry and to the best of my knowledge
and belief, I certify that the information set forth in this
statement is true, complete and correct.
Date: September 10, 1998 /s/ Frederick Willetts, III
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Frederick Willetts, III
