<PAGE> 1
As filed with the Securities & Exchange Commission on August 20, 1999
Registration No. 333-______
Securities & Exchange Commission
Washington, D.C. 20549
FORM S-8
Registration Statement Under The Securities Act of 1933
SOUTHFIRST BANCSHARES, INC.
---------------------------
(Exact name of registrant as specified in its charter)
Delaware 63-1121255
-------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
126 North Norton Avenue
Sylacauga, Alabama 35150
------------------------
(Address of principal executive offices)
1998 STOCK OPTION AND INCENTIVE PLAN
------------------------------------
(Full Title of the Plan)
DONALD C. STROUP
PRESIDENT AND CHIEF EXECUTIVE OFFICER
126 NORTH NORTON AVENUE
SYLACAUGA, ALABAMA 35150
(256) 245-4365
------------------------------
(Name, address and telephone number, including
area code, of agent for service)
------------------------------
Copies Requested to:
W. Thomas King, Esq.
Smith, Gambrell & Russell
Suite 3100, Promenade II
1230 Peachtree Road, N.E.
Atlanta, Georgia 30309-3592
(404) 815-3678
------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Proposed Proposed
Securities Amount Maximum Maximum Amount of
to be to be Offering Price Aggregate Registration
Registered Registered Per Share (1) Offering Price (1) Fee
- ----------- ---------- -------------- ------------------ -----------
<S> <C> <C> <C> <C>
Options and
underlying shares 63,361 $12.25 $776,172 $215.00
of Common Stock Shares
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) based upon the average of the high and low prices of the
Common Stock on the American Stock Exchange on August 19, 1999.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The documents listed below are hereby incorporated by reference into
this Registration Statement, and all documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act
of 1934, prior to the filing of a post-effective amendment which indicates that
all securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing such
documents:
(a) the Company's Annual Report on Form 10-KSB for the fiscal year
ended September 30, 1998;
(b) the Company's Quarterly Report on Form 10-QSB for the quarter
ended December 31, 1999;
(c) the Company's Quarterly Report on Form 10-QSB for the quarter
ended March 31, 1999; and
(d) the Company's Registration Statement on Form 8-A, as declared
effective by the Securities and Exchange Commission on February 22, 1995, to
register the Company's Common Stock, $.01 par value per share, under Section
12(b) of the Securities and Exchange Act of 1934, as amended, which Registration
Statement contains a description of the Common Stock.
Item 4. Description of Securities.
No response is required to this item.
Item 5. Interests of Named Experts and Counsel.
No response is required to this item.
Item 6. Indemnification of Officers and Directors.
Certificate of Incorporation. The Company's Amended and Restated
Certificate of Incorporation (the "Certificate") provides that, except with
respect to a matter as to which any person shall have been adjudicated in any
proceeding not to have acted in good faith or in a manner he reasonably believed
to be in, or not opposed to, the best interests of the Company, all persons
shall be entitled to be indemnified by the Company to the fullest extent
permitted by Delaware General Corporation law against any and all expenses
incurred in connection with any proceeding in which any such person is involved
as a result of serving or having served (a) as a director, officer, employee or
agent of the Company, or (b) as a director, officer, employee, agent, partner or
trustee of any other corporation, organization, partnership, joint venture,
trust or other entity at the request or direction of the Company.
In the event of a threatened, pending or completed action or suit by or
in the right of the Company, such person shall be indemnified if such person is
successful on the merits or if such person acted in good
<PAGE> 3
faith in the transaction which is the subject of the suit or action, or in a
manner such person reasonably believed to be in, or not opposed to, the best
interests of the Company, including the taking of any and all actions in
connection with the Company's response to any tender offer or any offer or
proposal of another party to engage in a business combination not approved by
the Board of Directors. However, such person shall not be indemnified in respect
of any claim, issue or matter as to which such person has been adjudged liable
to the Company unless (and only to the extent that) the court in which the suit
was brought shall determine, upon application, that despite the adjudication but
in view of all the circumstances, such person is fairly and reasonably entitled
to indemnity for such expenses as the court shall deem proper.
In the case of a threatened, pending or completed suit, action or
proceeding (whether civil, criminal, administrative or investigative), other
than a suit by or in the right of the Company (hereafter referred to as a
nonderivative suit), such person shall not be indemnified unless such person is
successful on the merits or acted in good faith in the transaction and in a
manner he reasonably believed to be in, or not opposed to, the best interests of
the Company, including the taking of any actions in connection with the
Company's response to any tender offer or any offer or proposal of any party to
engage in a business combination not approved by the Board of Directors or with
respect to any criminal action such person had no reasonable cause to believe
was unlawful.
No person shall be indemnified for expenses, penalties or other
payments incurred in connection with an administrative proceeding or action
instituted by a federal or state regulatory authority that results in a final
order assessing civil monetary penalties or requiring such person to make
payments to the Company. The Certificate provides that no director will be
personally liable to the Company or its shareholders for monetary damages for
breach of any fiduciary duty as a director other than (i) a breach of the
director's duty of loyalty to the Company or its shareholders, (ii) acts or
omissions not in good faith or involving intentional misconduct or knowing
violations of law, (iii) any transaction from which the director derives any
improper personal benefit, or (iv) acts specified under Section 174 of the
General Corporation Law of Delaware.
Delaware Corporate Law. Section 145 of the General Corporation Law of
the State of Delaware provides generally that a corporation may indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he/she is
or was a director, officer, employee or agent of the corporation, or is or was
serving at its request in such capacity in another corporation or business
association, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him/her in
connection with such action, suit or proceeding if he/she acted in good faith
and in a manner he/she reasonably believed to be in or not opposed to the best
interests of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his/her conduct was unlawful.
Plan Administrators. Pursuant to the terms of the Plan, the Company has
agreed to indemnify directors who serve as members of the committee responsible
for administering the Plan.
Insurance. The Company may purchase and maintain insurance on behalf of
any person who is or was a director, officer, employee or agent of the Company
or is or was serving at the request of the Company
II-2
<PAGE> 4
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
such person and incurred by such person in any such capacity or arising out of
his status as such, whether or not the Company would have the power to indemnify
him against such liability under the provisions of the Certificate.
Item 7. Exemption From Registration Claimed.
No response to this Item is required.
Item 8. Exhibits.
The following exhibits are filed with this Registration Statement.
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
------- ----------------------
<S> <C>
4.1 - Registrant's 1998 Stock Option and Incentive Plan, as Amended and Restated.
4.2 - Form of Stock Option Agreement.
5.1 - Opinion of Smith, Gambrell & Russell, LLP.
23.1 - Consent of Jones & Kirkpatrick, P.C.
23.1.1 - Consent of KPMG Peat Marwick LLP.
23.2 - Consent of Smith, Gambrell & Russell, LLP (contained in their opinion filed as
Exhibit 5.1).
</TABLE>
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration Statement to
include any material information with respect to the plan of distribution not
previously disclosed in the Registration Statement or any material change to
such information in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-3
<PAGE> 5
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in the Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Sylacauga, State of Alabama, on this 23rd day of
June, 1999.
SOUTHFIRST BANCSHARES, INC.
By: /s/ Donald C. Stroup
------------------------------------------------
Donald C. Stroup
President and Chief Executive Officer
(Principal Executive Officer)
By: /s/ Joe K. McArthur
------------------------------------------------
Joe K. McArthur
Executive Vice President, Chief Financial Officer,
Secretary and Treasurer (Principal Financial and
Accounting Officer)
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Donald C. Stroup and Joe K. McArthur, and
each of them, his true and lawful attorneys-in-fact and agents, with full power
of substitution and resubstitution for him, in his name, place and stead, in any
and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises as fully and to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Donald C. Stroup President and Chief Executive June 23, 1999
- --------------------- Officer
Donald C. Stroup
/s/ Joe K. McArthur Executive Vice President, June 23, 1999
- --------------------- Chief Financial Officer,
Joe K. McArthur Secretary, Treasurer and
Director
</TABLE>
[Signatures continued on following page]
II-5
<PAGE> 7
<TABLE>
<S> <C> <C>
/s/ H. David Foote, Jr. Director June 23, 1999
- -----------------------------
H. David Foote, Jr.
/s/ John T. Robbs Director June 23, 1999
- -----------------------------
John T. Robbs
/s/ Allen Gray McMillan, III Director June 23, 1999
- -----------------------------
Allen Gray McMillan, III
/s/ Charles R. Vawter, Jr. Director June 23, 1999
- -----------------------------
Charles R. Vawter, Jr.
/s/ J. Malcomb Massey Director June 23, 1999
- -----------------------------
J. Malcomb Massey
/s/ Bobby R. Cook Director June 23, 1999
- -----------------------------
Bobby R. Cook
</TABLE>
<PAGE> 8
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
- ------- ----------------------
<S> <C>
4.1 Registrant's 1998 Stock Option and Incentive Plan, as Amended and Restated.
4.2 Form of Incentive Stock Option Agreement.
5.1 Opinion of Smith, Gambrell & Russell, LLP.
23.1 Consent of Jones & Kirkpatrick, P.C.
23.1.1 Consent of KPMG Peat Marwick LLP
</TABLE>
<PAGE> 1
EXHIBIT 4.1
SOUTHFIRST BANCSHARES, INC.
1998 STOCK OPTION AND INCENTIVE PLAN
(AS AMENDED AND RESTATED)
1. PURPOSE OF THE PLAN
The purpose of this SouthFirst Bancshares, Inc. 1998 Stock Option and
Incentive Plan, as amended and restated (the "Plan") is to advance the interests
of SouthFirst Bancshares, Inc. (the "Company"), through providing select key
Employees and Directors of the Association, the Company and their Affiliates
with the opportunity to acquire Shares and participate in the equity of the
Company. By encouraging such stock ownership, the Company seeks to attract,
retain and motivate the best available personnel for positions of substantial
responsibility and to provide additional incentive to Directors and key
Employees of the Company, the Association or any Affiliate to promote the
success of the business.
2. DEFINITIONS
As used herein, the following definitions shall apply.
(a) "Affiliate" shall mean any "parent corporation" or
"subsidiary corporation" of the Company or the Association, as such terms are
defined in Section 424(e) and (f), respectively, of the Code, and shall also
include, as the context requires, the Company and the Association.
(b) "Agreement" shall mean a written agreement entered
into in accordance with Paragraph 5(c).
(c) "Association" shall mean First Federal of the South,
a Federal Savings Association.
(d) "Awards" shall mean, collectively, Options and SARs,
unless the context clearly indicates a different meaning.
(e) "Board" shall mean the Board of Directors of the
Company.
(f) "Change in Control" shall mean the occurrence of any
one of the following events: (1) a change in the ownership, holding or power to
vote more than 25% of the Association's or Company's voting stock, (2) a change
in the ownership or possession of the ability to control the election of a
majority of the Association's or Company's directors, (3) a change in the
ownership or possession of the ability to exercise a controlling influence over
the management or policies of the Association or the Company by any person or by
persons acting as a "group" (within the meaning of Section 13(d) of the
Securities Exchange Act of 1934) (except in the case of (1), (2) and (3) hereof,
ownership or control of the Association or its directors by the Company itself
shall not constitute a "Change in Control"), or (4) during any period of two (2)
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors of the Company or the Association (the "Continuing
Directors") cease for any reason to constitute at least two-thirds of the
members of such Board of Directors, provided that any individual whose election
or nomination for election as a member of such Board was approved by a vote of
at least two-thirds of the Continuing Directors then in office shall be
considered a Continuing Director. For purposes of this subparagraph only, the
term "person" refers to an individual or a corporation, partnership, trust,
association, joint venture, pool,
1
<PAGE> 2
syndicate, sole proprietorship, unincorporated organization or any other form of
entity not specifically listed herein. The decision of the Committee as to
whether a Change in Control has occurred shall be conclusive and binding.
(g) "Code" shall mean the Internal Revenue Code of 1986,
as amended.
(h) "Committee" shall mean, as the case may be, either, a
committee appointed by the Board in accordance with Paragraph 5(a) hereof or the
Board.
(i) "Common Stock" shall mean the common stock, par value
$.01 per share, of the Company.
(j) "Company" shall mean SouthFirst Bancshares, Inc.
(k) "Continuous Service" shall mean the absence of any
interruption or termination of service as an Employee or Director of the Company
or an Affiliate. Continuous Service shall not be considered interrupted in the
case of sick leave, military leave or any other leave or absence approved by the
Company or in the case of transfers between payroll locations of the Company or
between the Company, the Association or an Affiliate.
(l) "Director" shall mean any member of the Board or of
the Board of Directors of an Affiliate, including any member of the Board or
Board of Directors of an Affiliate who is serving as an Emeritus Director.
(m) "Disinterested Person" shall mean any Non-Employee
Director.
(n) "Effective Date" shall mean the date specified in
Paragraph 15 hereof.
(o) "Emeritus Director" means any Director of the Company
appointed by the Board who is 72 years of age or older.
(p) "Employee" shall mean any person employed by the
Company or an Affiliate.
(q) "Exercise Price" shall mean the price per Optioned
Share at which an Option or SAR may be exercised.
(r) "ISO" means an option to purchase Common Stock which
meets the requirements set forth in the Plan, and which is intended to be and is
identified as an "incentive stock option" within the meaning of Section 422 of
the Code.
(s) "Market Value" shall mean the fair market value of
the Common Stock, as determined under Paragraph 7(b) hereof.
(t) "Non-Employee Director" means any member of the Board
who is a 'non-employee director' within the meaning of Rule 16b-3.
(u) "Non-ISO" means an option to purchase Common Stock
which meets the requirements set forth in the Plan, but which is not intended to
be, and is not identified as, an ISO.
2
<PAGE> 3
(v) "Officer" means any officer of the Company or an
Affiliate.
(w) "Option" means an ISO and/or a Non-ISO.
(x) "Optioned Shares" shall mean Shares subject to an
option granted pursuant to this Plan.
(y) "Participant" shall mean any person who receives an
Award pursuant to the Plan.
(z) "Plan" shall mean the SouthFirst Bancshares, Inc.
1998 Stock Option and Incentive Plan, as amended and restated.
(aa) "Retirement" means termination of employment with the
Company, other than upon death, Total and Permanent Disability, or for Cause (as
defined in Section 8(c)), on or after the date of the 65th birthday of the
retiring person, in the case of an Employee, or on or after the date of the 72nd
birthday of the retiring person, in the case of a Director; provided that
Retirement for any Emeritus Director means termination of his or her
directorship, other than for Cause (as defined in Section 8(c)), on or after the
date of the 75th birthday of such Emeritus Director.
(bb) "Rule 16b-3" shall mean Rule 16b-3 of the General
Rules and Regulations under the Securities Exchange Act of 1934, as amended. .
(cc) "SAR" (or "Stock Appreciation Right") means a right
to receive the appreciation in value, or a portion of the appreciation in value,
from the date of grant, of a specified number of shares of Common Stock.
(dd) "Shares" means the shares of Common Stock reserved
for issuance under the Plan.
3. TERM OF THE PLAN AND AWARDS
(a) Term of the Plan. The Plan shall continue in effect
for a term of ten (10) years from the Effective Date, unless sooner terminated
pursuant to Paragraph 19 hereof. No Award shall be granted under the Plan after
ten (10) years from the Effective Date.
(b) Term of Awards. The term of each Award granted under
the Plan shall be established by the Committee, but shall not exceed ten (10)
years from the date of grant; provided, however, that in the case of the grant
of an ISO to an Employee who owns shares representing more than 10% of the
outstanding Common Stock of the Company at the time the ISO is granted, the term
of such ISO shall not exceed five (5) years.
4. SHARES SUBJECT TO THE PLAN
(a) General Rule. Except as otherwise required by the
provisions of Paragraph 12 hereof, the aggregate number of Shares issuable
pursuant to Awards shall be 63,361 Shares. Such Shares may either be
authorized-but-unissued shares of Common Stock or shares of Common Stock held in
treasury. If Awards shall expire, become unexercisable or be forfeited for any
reason without having been exercised or become vested in full, the Optioned
Shares shall, unless the Plan shall have been terminated, be available for the
grant of additional Awards under the Plan.
3
<PAGE> 4
(b) Special Rule for SARs. The number of Shares with
respect to which an SAR is granted, but not the number of Shares which the
Company delivers or could deliver to an Employee or individual upon exercise of
an SAR, shall be charged against the aggregate number of Shares remaining
available under the Plan; provided, however, that in the case of an SAR granted
in conjunction with an Option, under circumstances in which the exercise of the
SAR results in termination of the Option and vice versa, only the number of
Shares subject to the Option shall be charged against the aggregate number of
Shares remaining available under the Plan. The Shares relating to an Option as
to which option rights have terminated by reason of the exercise of a related
SAR, as provided in Paragraph 10 hereof, shall not be available for the grant of
further Options under the Plan.
5. ADMINISTRATION OF THE PLAN
(a) Administration by Entire Board or Committee. The Plan
shall be administered by, either, the Board or by a committee appointed by the
Board, which committee, if appointed, shall consist of not less than two (2)
members of the Board who are Disinterested Persons. Members of this committee
shall serve at the pleasure of the Board. In the absence at any time of a duly
appointed committee, the Plan shall be administered by the Board.
(b) Powers of the Committee. Except as limited by the
express provisions of the Plan or by resolutions adopted by the Board, the
Committee shall have the sole and complete authority and discretion (i) to
select Participants and grant Awards, (ii) to determine the form and content of
Awards to be issued and the form of Agreements under the Plan, (iii) to
interpret the Plan, (iv) to prescribe, amend and rescind rules and regulations
relating to the Plan, and (v) to make other determinations necessary or
advisable for the administration of the Plan. The Committee shall have and may
exercise such other power and authority as may be delegated to it by the Board
from time to time. A majority of the entire Committee shall constitute a quorum
and the action of a majority of the members present at any meeting at which a
quorum is present, or acts approved in writing by a majority of the Committee
without a meeting, shall be deemed the action of the Committee.
(c) Agreement. Each Award shall be evidenced by a written
agreement containing such provisions as may be approved by the Committee. Each
such Agreement shall constitute a binding contract between the Company and the
Participant, and every Participant, upon acceptance of such Agreement, shall be
bound by the terms and restrictions of the Plan and of such Agreement. The terms
of each such Agreement shall be in accordance with the Plan, but each Agreement
may include such additional provisions and restrictions determined by the
Committee, in its discretion, provided that such additional provisions and
restrictions are not inconsistent with the terms of the Plan. In particular, the
Committee shall set forth in each Agreement (i) the Exercise Price of an Option
or SAR, (ii) the number of Shares subject to, and the expiration date of, the
Award, (iii) the manner, time and rate (cumulative or otherwise) of exercise or
vesting of such Award, and (iv) the restrictions, if any, to be placed upon such
Award, or upon Shares which may be issued upon exercise of such Award.
The Chairman of the Committee and such other officers as shall
be designated by the Committee are hereby authorized to execute Agreements on
behalf of the Company and to cause them to be delivered to the recipients of
Awards.
(d) Effect of the Committee's Decisions. All decisions,
determinations and interpretations of the Committee shall be final and
conclusive on all persons affected thereby.
4
<PAGE> 5
(e) Indemnification. In addition to such other rights of
indemnification as they may have, the members of the Committee shall be
indemnified by the Company in connection with any claim, action, suit or
proceeding relating to any action taken or failure to act under or in connection
with the Plan or any Award, granted hereunder to the full extent provided for
under the Company's Charter or By-Laws with respect to the indemnification of
Directors.
6. GRANT OF OPTIONS
(a) General Rule. In its sole discretion, the Committee
may grant Options to Employees of the Company or its Affiliates. Non-Employee
Directors may be granted Options only in accordance with Paragraph 9 hereof.
(b) Special Rules for ISOs. The aggregate Market Value, as of
the date the Option is granted, of the Shares with respect to which ISOs are
exercisable for the first time by an Employee during any calendar year (under
all incentive stock option plans, as defined in Section 422 of the Code, of the
Company or any present or future Parent or Subsidiary of the Company) shall not
exceed $100,000. Notwithstanding the prior provisions of this paragraph, the
Committee may grant Options in excess of the foregoing limitation, in which case
such Options granted in excess of which limitation shall be Options which are
Non-ISOs.
7. EXERCISE PRICE FOR OPTIONS
(a) Limits on Committee Discretion. The Exercise Price as
to any particular Option granted under the Plan shall be determined by the
Committee but shall not be less than the Market Value of the Optioned Shares on
the date of grant. In the case of an Employee who owns shares of Common Stock
representing more than 10% of the Company's outstanding shares of Common Stock
at the time an ISO is granted, the Exercise Price of such ISO shall not be less
than 110% of the Market Value of the Optioned Shares at the time the ISO is
granted.
(b) Standards for Determining Exercise Price. If the
Common Stock is listed on a national securities exchange (including the NASDAQ
National Market System) on the date in question, then the Market Value per Share
shall be not less than the average of the highest and lowest selling price on
such exchange on such date, or if there were no sales on such date, then the
Exercise Price shall be not less than the mean between the bid and asked price
on such date. If the Common Stock is traded otherwise than on a national
securities exchange on the date in question, then the Market Value per Share
shall be not less than the mean between the bid and asked price on such date,
or, if there is no bid and asked price on such date, then on the next prior
business day on which there was a bid and asked price. If no such bid and asked
price is available, then the Market Value per Share shall be its fair market
value as determined by the Committee, in its sole and absolute discretion.
8. EXERCISE OF OPTIONS
(a) Generally. Any Option granted hereunder shall be
exercisable at such times and under such conditions as shall be permissible
under the terms of the Plan and of the Agreement granted to a Participant.
However, the exercise of any Option granted hereunder shall be subject to, and
shall not exceed, vesting at a rate of 20% a year, from the date of the Award,
provided that (i) each Participant shall be 100% vested upon death or upon
Permanent and Total Disability (as defined in Section 8 (c) below), (ii) each
Participant shall be 100% vested upon Retirement, and (iii) each Participant
shall be 100% vested upon
5
<PAGE> 6
the occurrence of a Change in Control event in accordance with Section 11,
below. An Option may not be exercised for a fractional Share.
(b) Procedure for Exercise. A Participant may exercise
Options, subject to provisions relative to its termination and limitations on
its exercise, only by (1) written notice to the Company of intent to exercise
the Option with respect to a specified number of Shares, and (2) payment to the
Company (contemporaneously with delivery of such notice) in cash, in Common
Stock, or a combination of cash and Common Stock, of the amount of the Exercise
Price for the number of Shares with respect to which the Option is then being
exercised. Each such notice (and payment where required) shall be delivered, or
mailed by prepaid registered or certified mail, addressed to the Treasurer of
the Company at the Company's executive offices. Common Stock utilized in full or
partial payment of the Exercise Price for Options shall be valued at its Market
Value at the date of exercise.
(c) Period of Exercisability. Except to the extent
otherwise provided by the Committee in the terms of an Agreement, an Option may
be exercised by an Employee only while he is an Employee and has maintained
Continuous Service from the date of the grant of the Option, or within three (3)
months after termination of such Continuous Service (but not later than the date
on which the Option would otherwise expire), except if the Participant's
Continuous Service terminates by reason of --
(1) "Cause" which for purposes hereof shall have the
meaning set forth in any unexpired employment or severance
agreement between the Participant and the Association and/or
the Company (and, in the absence of any such agreement, shall
mean termination because of the Participant's personal
dishonesty, incompetence, willful misconduct, breach of
fiduciary duty involving personal profit, intentional failure
to perform stated duties, willful violation of any law, rule
or regulation (other than traffic violations or similar
offenses) or final cease-and-desist order), in which case the
Participant's rights to exercise such Option shall expire on
the date of such termination;
(2) Death, in which case, 100% of the outstanding Options
of the deceased Participant such Options having vested in
their entirety as a consequence of the death of the
Participant, as provided in Section 8(a), may be exercised
within two (2) years from the date of his death (but not later
than the date on which the Option would otherwise expire) by
the personal representative of his estate or person or persons
to whom his rights under such Option shall have passed by will
or by laws of descent and distribution;
(3) Permanent and Total Disability (as such term is
defined in Section 22(e)(3) of the Code), in which case, 100%
of the outstanding Options of the Permanently and Totally
disabled Participant, such Options having vested in their
entirety as a consequence of the Permanent and Total
Disability of the Participant, as provided in Section 8(a),
may be exercised within one (1) year from the date of such
permanent and total disability, but not later than the date on
which the Option would otherwise expire.
(4) Retirement, in which case 100% of the outstanding
Options of the retiring Participant, such Options having
vested in their entirety as a consequence of the Retirement of
the Participant, as provided in Section 8(a), may be exercised
within six (6) months from the date of the Participant's
retirement, but not later than the date on which the Option
would otherwise expire.
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<PAGE> 7
(5) Change in Control, in which case 100% of the
outstanding Options of each Participant in the Plan shall
become immediately exercisable in accordance with Section 11
of the Plan.
Notwithstanding the provisions of any Option which provides for its exercise in
installments as designated by the Committee, such Option shall become
immediately exercisable upon the vesting of such Option upon the occurrence of a
vesting event set forth in Section 8(a).
(d) Effect of the Committee's Decisions. The Committee's
determination whether a Participant's Continuous Service has ceased, and the
effective date thereof shall be final and conclusive on all persons affected
thereby.
9. GRANTS OF OPTIONS TO NON-EMPLOYEE DIRECTORS
(a) Automatic Grants. Notwithstanding any other
provisions of this Plan, each Director who is a Non-Employee Director, other
than an Emeritus Director, on the Effective Date shall receive, on said date,
Non-ISOs to purchase 2,700 Shares, at an Exercise Price per Share equal to the
Market Value of the Common Stock on the date of grant.
(b) Terms of Exercise. Options received under the
provisions of this Paragraph 9 may be exercised from time to time by (a) written
notice to the Company of intent to exercise the Option with respect to all or a
specified number of the Optioned Shares, and (b) payment to the Company
(contemporaneously with the delivery of such notice), in cash, in Common Stock,
or a combination of cash and Common Stock, of the amount of the Exercise Price
for the number of Optioned Shares with respect to which the Option is then being
exercised. Each such notice and payment shall be delivered, or mailed by prepaid
registered or certified mail, addressed to the Treasurer of the Company at the
Company's executive offices. A Director who exercises Options pursuant to this
Paragraph may satisfy all applicable federal, state and local income and
employment tax withholding obligations, in whole or in part, by irrevocably
electing to have the Company withhold shares of Common Stock, or to deliver to
the Company shares of Common Stock that he already owns, having a value equal to
the amount required to be withheld; provided that to the extent not inconsistent
herewith, such election otherwise complies with those requirements of Paragraphs
8 and 21 hereof.
Options granted under this Paragraph shall have a term of ten (10)
years, and may be exercised at any time and from time to time prior to their
expiration only while the Participant is a Director of the Company, or within
three (3) months after termination of the Participant's Continuous Service as a
Director for reasons other than "Cause," death, "Permanent and Total Disability"
or "Retirement" of the Director, or a "Change in Control" of the Company. In the
event of such Director's death during the term of his directorship, Options
granted under this Paragraph may be exercised within one (1) year from the date
of his death by the personal representatives of his estate or person or persons
to whom his rights under such Options shall have passed by will or by laws of
descent and distribution, but in no event later than the date on which such
Options would otherwise expire. Unless otherwise inapplicable or inconsistent
with the provisions of this Paragraph, the Options to be granted to Directors
hereunder shall be subject to all other provisions of this Plan, including the
provisions of Section 8(c) relating to the period of exercisability if a
Director's Continuous Service terminates for "Cause," "Permanent and Total
Disability" or "Retirement" and the provisions of Section 11 relating to the
vesting and exercise of Options upon a "Change in Control" of the Company.
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<PAGE> 8
10. SARS (STOCK APPRECIATION RIGHTS)
(a) Granting of SARs. In its sole discretion, the
Committee may from time to time grant `SARs to Employees either in conjunction
with, or independently of, any Options granted under the Plan. An SAR granted in
conjunction with an Option may be an alternative right wherein the exercise of
the Option terminates the SAR to the extent of the number of shares purchased
upon exercise of the Option and, correspondingly, the exercise of the SAR
terminates the Option to the extent of the number of Shares with respect to
which the SAR is exercised. Alternatively, an SAR granted in conjunction with an
Option may be an additional right wherein both the SAR and the Option may be
exercised. An SAR may not be granted in conjunction with an ISO under
circumstances in which the exercise of the SAR affects the right to exercise the
ISO or vice versa, unless the SAR, by its term, meets all of the following
requirements:
(1) The SAR will expire no later than the ISO;
(2) The SAR may be for no more than the difference
between the Exercise Price of the ISO and the Market Value of
the Shares subject to the ISO at the time the SAR is
exercised;
(3) The SAR is transferable only when the ISO is
transferable, and under the same conditions;
(4) The SAR may be exercised only when the ISO may be
exercised; and
(5) The SAR may be exercised only when the Market Value
of the Shares subject to the ISO exceed the Exercise Price of
the ISO.
(b) Exercise Price. The Exercise Price as to any
particular SAR shall not be less than the Market Value of the Optioned Shares on
the date of grant.
(c) Timing of Exercise. Any election by a Participant to
exercise SARs shall be made during the period beginning on the 3rd business day
following the release for publication of quarterly or annual financial
information and ending on the 12th business day following such date. This
condition shall be deemed to be satisfied when the specified financial data is
first made publicly available. In no event, however, may an SAR be exercised
within the six-month period following the date of its grant.
The provisions of Paragraph 8(c) regarding the period of
exercisability of Options is incorporated by reference herein, and shall
determine the period of exercisability of SARs.
(d) Exercise of SARs. An SAR granted hereunder shall be
exercisable at such times and under such conditions as shall be permissible
under the term of the Plan and of the Agreement granted to a Participant,
provided that an SAR may not be exercised for a fractional Share. Upon exercise
of an SAR, the Participant shall be entitled to receive, without payment to the
Company except for applicable withholding taxes, an amount equal to the excess
of (or, in the discretion of the Committee if provided in the Agreement, a
portion of the excess of) the then aggregate Market Value of the number of
Optioned Shares with respect to which the Participant exercises the SAR, over
the aggregate Exercise Price of such number of Optioned Shares. This amount
shall be payable by the Company, in the discretion of the Committee, in cash or
in Shares valued at the then Market Value thereof, or any combination thereof.
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<PAGE> 9
(e) Procedure for Exercising SARs. To the extent not
inconsistent herewith, the provisions of Paragraph 8(b) as to the procedure for
exercising Options are incorporated by reference, and shall determine the
procedure for exercising SARs.
11. CHANGE IN CONTROL
(a) General Rule. Notwithstanding the provisions of any
Award which provides for the exercise or vesting in installments, and for a
period of sixty (60) days beginning on the date of such Change in Control, all
Options and SARs shall be immediately exercisable and fully vested. With respect
to Options, at the time of a Change in Control, the Participant shall, at the
discretion of the Committee, be entitled to receive cash in an amount equal to
the excess of the Market Value of the Common Stock subject to such Option over
the Exercise Price of such Shares, in exchange for the cancellation of such
Options by the Participant.
(b) Exception to General Rule. Notwithstanding
subparagraph (a) of this Paragraph, in no event may an SAR be exercised, or an
Option be canceled in exchange for cash, within the six-month period following
the date of its grant.
12. EFFECT OF CHANGES IN COMMON STOCK SUBJECT TO THE PLAN
(a) Recapitalizations; Stock Splits, Etc. The number and
kind of Shares reserved for issuance under the Plan, and the number and kind of
Shares subject to outstanding Awards (and the Exercise Price thereof in the case
of Options and SARs), shall be proportionately adjusted for any increase,
decrease, change or exchange of Shares for a different number or kind of Shares
or other securities of the Company which results from a merger, consolidation,
recapitalization, reorganization, reclassification, stock dividend, split-up,
combination of Shares, or similar event in which the number or kind of Shares is
changed without the receipt or payment of consideration by the Company.
(b) Transactions in which the Company is Not the
Surviving Entity. In the event of (i) the liquidation or dissolution of the
Company, (ii) a merger or consolidation in which the Company is not the
surviving entity, or (iii) the sale or disposition of all or substantially all
of the Company's assets (any of the foregoing to be referred to herein as a
"Transaction"), all outstanding Awards shall be surrendered. With respect to
each Award so surrendered, the Committee shall in its sole and absolute
discretion, but subject to the vesting requirements of Section 8(a), determine
whether the holder of the surrendered Award shall receive --
(1) for each Share then subject to an outstanding Award
the number and kind of Shares into which each outstanding
Share (other than Shares held by dissenting stockholders) is
changed or exchanged, together with an appropriate adjustment
to the Exercise Price in the case of Options and SARs; or
(2) a cash payment (from the Company or the successor
corporation), in an amount equal to the Market Value of the
Shares subject to the Award on the date of the Transaction,
less the Exercise Price of the Award in the case of Options
and SARs.
(c) Special Rule for ISOs. Any adjustment made pursuant
to subparagraphs (a) or (b)(1) hereof shall be made in such a manner as not to
constitute a modification, within the meaning of Section 424(h) of the Code, of
outstanding ISOs.
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<PAGE> 10
(d) Conditions and Restrictions on New, Additional, or
Different Shares or Securities. If, by reason of any adjustment made pursuant to
this Paragraph, a Participant becomes entitled to new, additional, or different
Shares of stock or securities, such new, additional, or different Shares of
stock or securities shall thereupon be subject to all of the conditions and
restrictions which were applicable to the Shares pursuant to the Award before
the adjustment was made.
(e) Other Issuances. Except as expressly provided in this
Paragraph, the issuance by the Company or an Affiliate of Shares of stock of any
class, or of securities convertible into Shares or stock of another class, for
cash or property or for labor or services either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor, shall not affect, and no
adjustment shall be made with respect to, the number, class, or Exercise Price
of Shares then subject to Awards or reserved for issuance under the Plan.
13. NON-TRANSFERABILITY OF AWARDS
Awards may not be sold, pledged, assigned, hypothecated, transferred or
disposed of in any manner other than by will or by the laws of descent and
distribution, or pursuant to the terms of a "qualified domestic relations order"
(within the meaning of Section 414(p) of the Code and the regulations and
rulings thereunder).
14. TIME OF GRANTING AWARDS
The date of grant of an Award shall, for all purposes, be the date on
which the Committee makes the determination for granting such Award. Notice of
the determination shall be given to each Participant to whom an Award is so
granted within a reasonable time after the date of such grant.
15. EFFECTIVE DATE
The effective date of the Plan (the "Effective Date") shall be the date
the Plan is adopted by the Board or the date the Plan is approved by the
shareholders of the Company, whichever is earlier. The Plan must be approved by
the affirmative vote, cast either in person or by proxy, of not less than a
majority of the Shares entitled to vote at a meeting at which a quorum is
present, which shareholder vote must be taken within twelve (12) months after
the date the Plan is adopted by the Board of Directors. Such shareholder vote
shall not alter the Effective Date of the Plan. In the event shareholder
approval of the adoption of the Plan is not obtained within the aforesaid twelve
(12) month period, then any Options granted in the intervening period shall be
void.
16. MODIFICATION OF AWARDS
At any time, and from time to time, the Board may authorize the
Committee to direct execution of an instrument providing for the modification of
any outstanding Award, provided no such modification shall confer on the holder
of such Award any right or benefit which could not be conferred on him by the
grant of a new Award at such time, or impair the Award without the consent of
the holder of the Award, or revise the terms of the Award, including the
exercise price at which the Award was granted.
17. AMENDMENT AND TERMINATION OF THE PLAN
With respect to any shares of stock at the time not subject to an award
of Options or SARs under the Plan, the Board may at any time and from time to
time, terminate, modify or amend the Plan in any respect, except that no such
modification or amendment shall be made absent the approval of the
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<PAGE> 11
shareholders of the Company to: (i) increase the number of shares for which
Options or SARs may be granted under the Plan; (ii) extend the period during
which Options or SARs may be granted or exercised; (iii) change the class of
persons eligible for awards of Options or SARs; or (iv) otherwise materially
modify the requirements as to eligibility for participation in the Plan. The
Company's Board of Directors may also suspend the granting of Options or SARs
pursuant to the Plan at any time and may terminate the Plan at any time;
provided, however, no such suspension or termination shall modify or amend any
Option or SAR granted before such suspension or termination unless the affected
participant consents in writing, to such modification or amendment or there is a
dissolution or liquidation of the Company.
18. CONDITIONS UPON ISSUANCE OF SHARES
(a) Compliance with Securities Laws. Shares of Common
Stock shall not be issued with respect to any Award unless the issuance and
delivery of such Shares shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the rules
and regulations promulgated thereunder, any applicable state securities law, and
the requirements of any stock exchange upon which the Shares may then be listed.
The Plan is intended to comply with Rule 16b-3, and any provision of the Plan
which the Committee determines in its sole and absolute discretion to be
inconsistent with said Rule shall, to the extent of such inconsistency, be
inoperative and null and void, and shall not affect the validity of the
remaining provisions of the Plan.
(b) Special Circumstances. The inability of the Company
to obtain approval from any regulatory body or authority deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares hereunder
shall relieve the Company of any liability in respect of the non-issuance or
sale of such Shares. As a condition to the exercise of an option or SAR, the
Company may require the person exercising the Option or SAR to make such
representations and warranties as may be necessary to assure the availability of
an exemption from the registration requirements of federal or state securities
law.
(c) Committee Discretion. The Committee shall have the
discretionary authority to impose in Agreements such restrictions on Shares as
it may deem appropriate or desirable, including, but not limited to, the
authority to impose a right of first refusal or to establish repurchase rights
or both of these restrictions.
19. RESERVATION OF SHARES
The Company, during the term of the Plan, will reserve and keep
available a number of Shares sufficient to satisfy the requirements of the Plan.
20. WITHHOLDING TAX
The Company's obligation to deliver Shares upon exercise of Options
and/or SARs (or such earlier time that the Participant makes an election under
Section 83(b) of the Code) shall be subject to the Participant's satisfaction of
all applicable federal, state and local income and employment tax withholding
obligations. The Committee, in its discretion, may permit the Participant to
satisfy the obligation, in whole or in part, by irrevocably electing to have the
Company withhold the Shares, or to deliver to the Company the Shares that he
already owns, having a value equal to the amount required to be withheld. The
value of Shares to be withheld, or delivered to the Company, shall be based on
the Market Value of the Shares on the date the amount of tax to be withheld is
to be determined. As an alternative, the Company may retain, or sell without
notice, a number of such Shares sufficient to cover the amount required to be
withheld.
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<PAGE> 12
21. NO EMPLOYMENT OR OTHER RIGHTS
In no event shall an Employee's or Director's eligibility to
participate or participation in the Plan create or be deemed to create any legal
or equitable right of the Employee, Director, or any other party to continue
service with the Company, the Association, or any Affiliate of such
corporations. No Employee or Director shall have a right to be granted an Award
or, having received an Award, the right to again be granted an Award, except to
the extent provided in Paragraph 9(a). However, an Employee or Director who has
been granted an Award may, if otherwise eligible, be granted an additional Award
or Awards.
22. GOVERNING LAW
The Plan shall be governed by and construed in accordance with the laws
of the State of Delaware, except to the extent that federal law shall be deemed
to apply.
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<PAGE> 1
EXHIBIT 4.2
FORM OF
SOUTHFIRST BANCSHARES, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT ("Option Agreement") is made and entered
into as of the ____ day of ________, ____, by and between SouthFirst Bancshares,
Inc. (the "Company") and __________________, an employee [a director] of [the
Company] [First Federal of the South, an Affiliate] [Pension & Benefit Financial
Services, Inc., an Affiliate] ("Participant").
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company has adopted that certain
SouthFirst Bancshares, Inc. 1998 Stock Option and Incentive Plan, as amended and
restated (the "Plan"), a copy of which is attached hereto as Exhibit "A" and
incorporated herein by reference. Pursuant to the terms of the Plan, the Board
of Directors has selected Participant to participate in the Plan and desires to
grant to Participant certain stock options to purchase shares of the Company's
authorized common stock ("Stock"), subject to the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual promises, agreements and
covenants contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. INCORPORATION OF PROVISIONS
This Option Agreement is subject to, and is to be construed in all
respects in a manner which is consistent with, the terms of the Plan, the
provisions of which are hereby incorporated by reference into this Option
Agreement. To the extent that any terms contained herein are contrary to, or
inconsistent with, the terms of the Plan, the terms of the Plan shall govern.
Unless specifically provided otherwise, all defined terms used in this Option
Agreement shall have the same meaning as in the Plan.
2. GRANT OF OPTION
Subject to the further terms and conditions of this Option Agreement,
Participant is hereby granted an incentive stock option to purchase _______
shares of Stock, effective as of the date first written above. This stock option
is intended to be [a Non-ISO] [an ISO].
3. MARKET VALUE OF STOCK
The Board of Directors has determined, in good faith and in its best
judgment, that the Market Value per share of Stock, as of the date the stock
option is granted pursuant to this Option Agreement, is $________.
<PAGE> 2
4. OPTION PRICE
The Board of Directors has determined that the price for each share of
Stock purchased under this Option Agreement shall be $________, the Market Value
per share of Stock.
5. EXPIRATION OF OPTIONS
The option to acquire Stock pursuant to this Option Agreement shall
expire (to the extent not previously fully exercised) upon the first to occur of
the following:
(a) __________ (the tenth anniversary of the Effective Date),
unless an ISO granted to a 10% holder, in which case __________ (the fifth
anniversary of the Effective Date);
(b) The date which is three months following the date upon which
Participant ceases Continuous Service with the Company, or any Affiliate,
otherwise than as a result of a Change in Control of the Company or
Participant's death, Permanent and Total Disability, Retirement, or termination
for Cause;
(c) The date upon which Participant ceases Continuous Service
with the Company, or any Affiliate, other than as a result of termination for
Cause, with respect to any portion of this option which is not then exercisable
on the date Participant ceases his employment with the Company;
(d) The date which is 60 days following the date upon which
Participant ceases to be employed by the Company, or any Affiliate, by reason of
a Change in Control of the Company;
(e) The date which is the second anniversary of the date upon
which Participant ceases to be employed by the Company, or any Affiliate, by
reason of Participant's death;
(f) The date which is the first anniversary of the date upon
which Participant ceases to be employed by the Company, or any Affiliate, by
reason of Participant's Permanent and Total Disability;
(g) The date which is six months following the date upon which
Participant ceases to be employed by the Company, or any Affiliate, by reason of
Participant's Retirement; or
(h) The date upon which Participant ceases to be employed by the
Company, or any Affiliate, by reason of Participant's termination for Cause.
6. EXERCISE OF OPTION
Unless options hereunder shall earlier lapse or expire pursuant to
Section 5 hereof, the option to acquire the aggregate number of ______ shares
under this option may be first exercised on the
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<PAGE> 3
dates and with respect to the aggregate number of shares subject to this Option
Agreement as follows:
(a) One year from date of grant, _____ shares (20%);
(b) Two years from date of grant, an additional _____
shares (20%);
(c) Three years from date of grant, an additional _____
shares (20%);
(d) Four years from date of grant, an additional _____
shares (20%);
(e) Five years from date of grant, an additional _____
shares (20%).
To the extent such options become exercisable in accordance with the
foregoing, Participant may exercise the stock option granted hereunder, in whole
or in part, from time to time. The option exercise price may be paid by
Participant either in cash or by surrender of other shares of Stock of the
Company held by Participant. Participant, shall be given credit against the
option exercise price hereunder for such shares surrendered equal to the Market
Value on the day preceding exercise of the option.
7. MANNER OF EXERCISE
The stock option granted hereunder may be exercised by written notice
to the Company specifying the number of shares to be purchased and signed by
Participant or such other person who may be entitled to acquire stock under this
Option Agreement. If any such notice is signed by a person other than
Participant, such person shall also provide such other information and documenta
tion as the Committee may reasonably require to assure that such person is
entitled to acquire Stock under the terms of the Plan and this Option Agreement.
8. RESTRICTIONS ON TRANSFERABILITY
The stock option granted hereunder shall not be transferable by
Participant, otherwise than by will or by the laws of descent and distribution,
or pursuant to the terms of a "qualified domestic relations order" within the
meaning of Section 414(p) of the Code and the regulations and rulings thereunder
("QDRO"). Unless transferred pursuant to the terms of a QDRO, such stock option
shall be exercisable during Participant's lifetime only by Participant.
9. FURTHER RESTRICTIONS ON EXERCISE AND SALE OF STOCK
No portion of the stock option granted hereunder shall be exercisable
at any time during which there is not on file with the Securities and Exchange
Commission an effective registration statement covering the option shares on
Form S-8, or similar form promulgated by the Securities and Exchange Commission.
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<PAGE> 4
Nothing contained in this section shall be construed to obligate the
Company to, or to grant any right to the holder of the stock option granted
hereunder to, cause the Company to file any registration statement; or, if any
such registration statement is filed, to prepare any additional prospectus, to
file any amendments to the registration statement, or to continue said
registration statement in effect.
If, at any time during which the stock option is otherwise exercisable
according to its terms, there is no effective Registration Statement on file
with the Securities and Exchange Commission covering the shares then acquirable
hereunder, the Committee may, in its sole discretion, permit the stock option to
be exercised by the holder, upon its satisfaction that the offer and sale of
such option shares to the option holder is exempt in fact from the registration
requirements of the Securities Act of 1933, as amended, and such state
securities laws as shall be applicable, and may condition such exercise upon its
receipt of such representations, factual assurances and legal opinions as it
shall deem necessary to determine and document the availability of any such
exemption and may further condition such exercise upon such undertakings by the
holder hereof or such restriction upon the transferability of the shares to be
acquired hereunder as it shall determine to be necessary to effectuate and
protect the claim to any such exemption.
10. REORGANIZATION AND RECAPITALIZATION
In the event that dividends are payable in Stock of the Company or in
the event there are splits, subdivisions or combinations of shares of Stock of
the Company, the number of shares available under the Plan shall be increased or
decreased proportionately, as the case may be, and the number of shares
deliverable upon the exercise thereafter of any option theretofore granted shall
be increased or decreased proportionately, as the case may be, without change in
the aggregate purchase price.
In case the Company is merged or consolidated with another corporation
and the Company is not the surviving corporation, or in case the property or
stock of the Company is acquired by another corporation, or in case of a
separation, reorganization, recapitalization or liquidation of the Company, all
outstanding Awards shall be surrendered. With respect to each such surrendered
Award, the Committee shall determine, subject to the vesting requirements of
Sections 5 and 6 of this Option Agreement and Section 8(a) of the Plan, whether
the holder of the surrendered Award shall receive
(i) for each share then subject to an outstanding award, the number and
kind of Shares into which each outstanding Share (other than Shares
held by dissenting stockholders) is changed or exchanged, together with
an appropriate adjustment to the Exercise Price; or
(ii) a cash payment (from the Company or the successor corporation), in
an amount equal to the Market Value of the Shares subject to the Award
on the date of the Transaction, less the Exercise Price of the Award.
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<PAGE> 5
Any adjustment made hereunder shall be made in such a manner as not to
constitute a modification, within the meaning of Section 424(h) of the Code.
11. AGREEMENT WITH RESPECT TO PRIOR OPTIONS
Participant hereby agrees to and approves the rescission and
cancellation of all stock options granted to Participant on __________ under the
Plan and the replacement of such stock options with a like number of stock
options granted under the Plan pursuant to this Option Agreement.
IN WITNESS WHEREOF, the Committee has caused this Option Agreement to
be executed by a duly authorized officer of the Company, and Participant has
executed this Option Agreement as of the date first above written.
SOUTHFIRST BANCSHARES, INC.
By:
----------------------------------------
Title:
-------------------------------------
ATTEST:
- --------------------------------
Secretary or Assistant Secretary
"PARTICIPANT"
----------------------------------
5
<PAGE> 1
EXHIBIT 5.1
[LETTERHEAD OF SMITH, GAMBRELL & RUSSELL, LLP]
August 20, 1999
Board of Directors
SouthFirst Bancshares, Inc.
126 North Norton Avenue
Sylacauga, Alabama 35150
RE: SouthFirst Bancshares, Inc.
Registration Statement on Form S-8
63,361 Shares of Common Stock
1998 Stock Option and Incentive Plan
Gentlemen:
We have acted as counsel for SouthFirst Bancshares, Inc. (the
"Company") in connection with the registration of 63,361 shares of its $.01 par
value Common Stock (the "Shares") reserved to the Company's 1998 Stock Option
and Incentive Plan, as Amended and Restated (the "Plan") pursuant to a
Registration Statement on Form S-8 to be filed with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended (the "Act"),
covering the Shares.
In connection therewith, we have examined the following:
(1) The Certificate of Incorporation of the Company, as amended, certified
by the Secretary of State of the State of Delaware;
(2) The Bylaws of the Company, certified as complete and correct by the
Secretary of the Company;
(3) The minute book of the Company, certified as correct and complete by
the Secretary of the Company; and
(4) The Registration Statement on Form S-8 to be filed with the Securities
and Exchange Commission pursuant to the Act (the "Registration
Statement").
Based upon such examination and upon examination of such other
instruments and records as we have deemed necessary, we are of the opinion that
the Shares covered by the Registration Statement have been legally authorized
and, when issued in accordance with the terms described in the Registration
Statement, will be validly issued, fully paid and nonassessable.
<PAGE> 2
Board of Directors
SouthFirst Bancshares, Inc.
August 20, 1999
Page 2
We consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to this firm under the caption
"Legal Matters" in the Prospectus. In giving this consent, we do not thereby
admit that we come within the category of persons whose consent is required
under Section 7 of the Act, or the rules and regulations of the Securities and
Exchange Commission thereunder.
Sincerely,
SMITH, GAMBRELL & RUSSELL, LLP
/s/ W. Thomas King
------------------------------
W. Thomas King
<PAGE> 1
EXHIBIT 23.1
Consent of Jones and Kirkpatrick, P.C., Independent Auditors
We consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated November 10, 1998 appearing in the
Annual Report on Form 10-KSB of SouthFirst Bancshares, Inc. for its fiscal year
ended September 30, 1998.
/s/ Jones & Kirkpatrick, P.C.
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Jones & Kirkpatrick, P.C.
Birmingham, Alabama
August 20, 1999
<PAGE> 1
EXHIBIT 23.1.1
Consent of KPMG Peat Marwick LLP, Independent Auditors
The Board of Directors
SouthFirst Bancshares, Inc.:
We consent to the use of our report incorporated herein by reference.
/s/ KPMG Peat Marwick LLP
- -------------------------
KPMG Peat Marwick LLP
Birmingham, Alabama
August 16, 1999
