Exhibit 99.0
F&M NATIONAL CORPORATION
1992 INCENTIVE AND NON-QUALIFIED STOCK OPTION PLAN
(As amended and restated February 2, 1998)
ARTICLE I
Establishment, Purpose and Duration
1.1 Establishment of the Plan. F&M National Corporation (the "Company"), a
Virginia corporation, hereby establishes an incentive compensation plan to be
known as the "1992 Incentive and Non-Qualified Stock Option Plan" (hereinafter
referred to as the "Plan"), as set forth in this document. Unless otherwise
defined herein, all capitalized terms shall have the meanings set forth in
Section 2.1 herein. The Plan permits the grant of Incentive Stock Options and
Non-qualified Stock Options.
The Plan was adopted by the Board of Directors on December 11, 1991 and
became effective, as of April 17, 1992 (the "Effective Date"). The Plan was
amended and restated effective as of February 2, 1998, subject to the approval
by vote of shareholders of the Company in accordance with applicable laws.
1.2 Purpose of the Plan. The purpose of the Plan is to promote the success
of the Company and its Subsidiaries by providing incentives to Key Employees
that will promote the identification of their personal interest with the
long-term financial success of the Company and with growth in shareholder value.
The Plan is designed to provide flexibility to the Company in its ability to
motivate, attract, and retain the services of Key Employees upon whose judgment,
interest, and special effort the successful conduct of its operation is largely
dependent.
1.3 Duration of the Plan. The Plan shall commence on the Effective Date,
as described in Section 1.1 here, and shall remain in effect, subject to the
right of the Board of Directors to terminate the Plan at any time pursuant to
Article IX herein, until April 16, 2002, at which time it shall terminate except
with respect to Awards made prior to, and outstanding on, that date which shall
remain valid in accordance with their terms.
ARTICLE II
Definitions
2.1 Definitions. Except as otherwise defined in the Plan, the following
terms shall have the meaning set forth below:
(a) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 under the Securities Exchange Act of
1934, as amended (the "Exchange Act").
(b) "Agreement" means a written agreement implementing the grant of
each Award signed by an authorized officer of the Company and by the
Participant.
(c) "Award" means, individually or collectively, a grant under this
Plan of Incentive Stock Options or Non-qualified Stock Options.
(d) "Award Date" or "Grant Date" means the date on which an Award is
made by the Committee under this Plan.
(e) "Beneficial Owner" shall have the meaning ascribed to such term
in Rule 13d-3 under the Exchange Act.
(f) "Board" means the Board of Directors of the Company.
(g) "Change in Control" shall be deemed to have occurred if the
conditions set forth in any one of the following paragraphs shall have
been satisfied:
(i) any Person (other than the Company, any Subsidiary, a
trustee or other fiduciary holding securities under an employee
benefit plan of the Company or its Subsidiaries), who or which,
together with all Affiliates and Associates of such Person is or
becomes the Beneficial Owner, directly or indirectly, of securities
of the Company representing 20% or more of the combined voting power
of the Company's then outstanding securities; or
(ii) if, at any time after the Effective Date, the composition
of the Board of Directors shall change such that a majority of the
Board shall no longer consist of Continuing Directors; or
(iii) if at any time, (a) the Company shall consolidate with,
or merge with, any other Person and the Company shall not be the
continuing or surviving corporation, (b) any Person shall
consolidate with, or merge with, the Company, and the Company shall
be the continuing or surviving corporation and in connection
therewith, all or part of the outstanding Stock shall be changed
into or exchanged for stock or other securities of any other Person
or cash or any other Person after which the Company is Subsidiary of
any other Person, or (d) the Company shall sell or otherwise
transfer 50% or more of the assets or earning power of the Company
and its Subsidiaries (taken as a whole) to any Person or Persons.
(h) "Code" means the Internal Revenue Code of 1986, as amended from time
to time.
(i) "Committee" means the committee of the Board appointed to administer
the Plan pursuant to Article III, all of the members of which shall be
"disinterested persons" as defined in Rule 16b-3 under the Exchange Act or any
similar or successor rule. Unless otherwise determined by the Board, the members
of the Committee responsible for executive compensation who are not employees of
the Company or its Subsidiaries shall constitute the Committee.
(j) "Company" means F&M National Corporation, or any successor thereto as
provided in Article XI.
(k) "Continuing Director" means an individual who was a member of the
Board on the Effective Date or whose subsequent nomination for election or
election to the Board was recommended or approved by the affirmative vote of
two-thirds of the Continuing Directors then in office.
(l) "Fair Market Value" of a Share means the closing price of the Stock on
the relevant date if it is a trading date, or if not, on the most recent date on
which the Stock was traded prior to such date, as reported by the New York Stock
Exchange, or if, in the opinion of the Committee, this method is inapplicable or
inappropriate for any reason, the fair market value as determined pursuant to a
reasonable method adopted by the Committee in good faith for such purpose.
(m) "Incentive Stock Option" or "ISO" means an option to purchase Stock,
granted under Article VI, which is designed as an incentive stock option and is
intended to meet the requirements of and qualify for favorable Federal income
tax treatment under Code Section 422.
(n) "Key Employee" means an officer or other key employee of the Company
or its Subsidiaries, who, in the opinion of the Committee, can contribute
significantly to the growth and profitability of, or perform services of major
importance to, the Company and its Subsidiaries. "Key Employee" does not include
directors of the Company who are not also employees of the Company or its
Subsidiaries.
(o) "Non-qualified Stock Option" or "NQSO" means an option to purchase
Stock, granted under Article VI, which does not meet the requirements of Code
Section 422, or ever if meeting the requirements of Code Section 422, is not
intended to be an Incentive Stock Option and is so designated.
(p) "Option" means an Incentive Stock Option or Non-qualified Stock
Option.
(q) "Participant" means a Key Employee who has been granted an Award under
the Plan.
(r) "Person" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof,
including a "group" as defined in Section 13(d).
(s) "Plan" means the F&M National Corporation 1992 Incentive and
Non-Qualified Stock Option Plan as amended and restated effective February 2,
1998, as herein described and as hereafter from time to time amended.
(t) "Subsidiary" shall mean a corporation at least 50% of the total
combined voting power of all classes of stock of which is owned by the Company,
either directly or through one or more of its Subsidiaries.
(u) "Stock" or "Shares" means the common stock of the Company.
ARTICLE III
Administration
3.1 The Committee. The Plan shall be administered by the Committee which
shall have all powers necessary or desirable for such administration. The
express grant in this Plan of any specific power to the Committee shall not be
construed as limiting any power or authority of the Committee. In addition to
any other powers and, subject to the provisions of the Plan, the Committee shall
have the following specific powers: (i) to determine the terms and conditions
upon which the Awards may be made and exercised; (ii) to determine all terms and
provisions of each Agreement, which need not be identical; (iii) to construe and
interpret the Agreements and the Plan; (iv) to make all other determinations and
take all other actions necessary or advisable for the administration of the
Plan.
3.2 Selection of Participants. The Committee shall have the authority to
grant Awards under the Plan, from time to time, to such Key Employees as may be
selected by it. Each Award shall be evidenced by an Agreement.
3.3 Decisions Binding. All determinations and decisions made by the Board
or the Committee pursuant to the provisions of the Plan shall be final,
conclusive and binding.
3.4 Rule 16b-3 Requirements. Notwithstanding any other provision of the
Plan, the Board or the Committee may impose such conditions on any Award, and
amend the Plan in any such respects, as may be required to satisfy the
requirements of Rule 16b-3, as amended (or any successor or similar rule), under
the Exchange Act.
3.5 Indemnification of Committee. In addition to such other rights of
indemnification as they may have as directors or as members of the Committee,
the members of the Committee shall be indemnified by the Company against
reasonable expenses, including attorneys' fees, actually and reasonably incurred
in connection with the defense of any action, suit or proceeding, or in
connection with any appeal therein, to which they or any of them may be a party
by reason of any action taken or failure to act under or in connection with the
Plan or any Award granted or made hereunder, and against all amounts reasonably
paid by them in settlement thereof or paid by them in satisfaction of a judgment
in any such action, suit or proceeding, if such members acted in good faith and
in a manner which they believed to be in, and not opposed to, the best interests
of the Company and its subsidiaries.
ARTICLE IV
Stock Subject to the Plan
4.1 Number of Shares. Subject to adjustment as provided in Section 4.4
herein, the maximum aggregate number of Shares that may be issued pursuant to
Awards made under the plan shall not exceed 750,000. Except as provided in
Sections 4.2 and 4.3 herein, the issuance of Shares under the Plan shall reduce
the number of Shares available for future Awards under the Plan.
4.2 Lapsed Awards or Forfeited Shares. If any Award granted under this
Plan terminates, expires, or lapses for any reason other than by virtue of
exercise of the Award, any Stock subject to such Award again shall be available
for the grant of an Award under the Plan.
4.3 Delivery of Shares as Payment. In the event a Participant pays the
Option Price for Shares pursuant to the exercise of an Option with previously
acquired Shares, the number of Shares available for future Awards under the Plan
shall be reduced only by the net number of new Shares issued upon the exercise
of the Option.
4.4 Capital Adjustments. The number and class of Shares subject to each
outstanding Award, the Option Price and the aggregate number and class of Shares
for which Awards thereafter may be made shall be subject to such adjustment, if
any, as the Committee in its sole discretion deems appropriate to reflect such
events as stock dividends, stock splits, recapitalizations, mergers,
consolidations or reorganizations of or by the Company.
ARTICLE V
Eligibility
Persons eligible to participate in the Plan include all employees of the
Company and its Subsidiaries who, in the opinion of the Committee, are Key
Employees. Key Employees may not include directors of the Company who are not
employees of the Company or its Subsidiaries.
ARTICLE VI
Stock Options
6.1 Grant of Options. Subject to the terms and provisions of the Plan,
Options may be granted to Key Employees at any time and from time to time as
shall be determined by the Committee. The Committee shall have complete
discretion in determining the number of Shares subject to Options granted to
each Participant, provided, however, that the aggregate Fair Market Value
(determined at the time the Award is made) of Shares with respect to which any
Participant may first exercise ISOs granted under the Plan during any calendar
year may not exceed $100,000 or such amount as shall be specified in Section 422
of the Code and rules and regulations thereunder.
6.2 Option Agreement. Each Option grant shall be evidenced by an Agreement
that shall specify the type of Option granted, the Option price per share, the
duration of the Option, the number of Shares to which the Option pertains, any
conditions imposed upon the exercisability of Options in the event of
retirement, death, disability or other termination of employment, and such other
provisions as the Committee shall determine. The Agreement shall specify whether
the Option is intended to be an Incentive Stock Option within the meaning of
Code Section 422, or a Non-qualified Stock Option not intended to be within the
provision of Code Section 422.
6.3 Option Price. The exercise price per share of Stock covered by an
Option ("Option Price") shall be determined by the Committee subject to the
following limitations. In the case of an ISO, the Option Price shall not be less
than 100% of the Fair Market Value of such Stock on the Grant Date. An ISO
granted to an Employee who, at the time of grant, owns (within the meaning of
Code Section 425(d)) Stock possessing more than 10% of the total combined voting
power of all classes of Stock of the Company, shall have an Option Price which
is at least equal to 110% of the Fair Market Value of the Stock. In the case of
NQSO, the Option Price shall not be less than 50% of the Fair Market Value of
the Stock on the Grant Date.
6.4 Duration of Options. Each Option shall expire at such time as the
Committee shall determine at the time of grant, provided, however, that no ISO
shall be exerciseable later than the tenth (10th) anniversary date of its Award
Date.
6.5 Exercisability. Options granted under the Plan shall be exerciseable
at such times and be subject to such restrictions and conditions as the
Committee shall determine, which need not be the same for all Participants.
6.6 Method of Exercise. Options shall be exercised by the delivery of a
written notice to the Company in the form prescribed by the Committee setting
forth the number of Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares. The Option Price shall be payable to
the Company in full either in cash, by delivery of Shares of Stock valued at
Fair Market Value at the time of exercise, or by a combination of the foregoing.
As soon as practicable, after receipt of written notice and payment, the Company
shall deliver to the Participant stock certificates in an appropriate amount
based upon the number of Options exercised, issued in the Participant's name. No
Participant who is awarded Options shall have rights as a shareholder until the
date of exercise of the Options.
6.7 Options Awarded Upon Stock Delivery Exercise. The Committee, in its
discretion, may provide in the Agreement that, in the event a Participant pays
the Option Price for an Option by delivery of previously acquired Shares, the
Participant will be granted a new Option ("Replacement Option") for that number
of Shares delivered in payment of the Option Price of the original Option
("Original Option"). The Committee shall determine the terms and conditions of
the Replacement Option; provided, however, that the Option Price of the
Replacement Option shall be the Fair Market Value of Shares on its Award Date
and the term of the Replacement Option shall expire upon the expiration date of
the Original Option.
6.8 Restrictions on Stock Transferability. The Committee shall impose such
restrictions on any Shares acquired pursuant to the exercise of an Option under
the Plan as it may deem advisable, including, without limitation, restrictions
under applicable Federal securities law, under the requirements of the National
Association of Securities Dealers, Inc., or any stock exchange upon which such
Shares are then listed and under any blue sky or state securities laws
applicable to such Shares.
6.9 Nontransferability of Options. No Option granted under the Plan may be
sold, transferred, pledged assigned, or otherwise alienated or hypothecated,
otherwise than by will or by the laws of descent and distribution. Further, all
Options granted to a Participant under the Plan shall be exerciseable during his
lifetime only by such Participant or his guardian or legal representative.
ARTICLE VII
Change in Control
In the event of a Change in Control of the Company, the Committee, as
constituted before such Change in Control, in its sole discretion may, as to any
outstanding Award, either at the time the Award is made or any time thereafter,
take any one or more of the following actions: (i) provide for the acceleration
of any time periods relating to the exercise or realization of any such Award so
that such Award may be exercised or realized in full on or before a date
initially fixed by the Committee; (ii) provide for the purchase or settlement of
any such Award by the Company, upon a Participant's request, for any amount of
cash equal to the amount which could have been obtained upon the exercise of
such Award or realization of such Participant's rights had such Award been
currently exerciseable or payable; (iii) make such adjustment to any such Award
then outstanding as the Committee deems appropriate to reflect such Change in
Control; or (iv) cause any such Award then outstanding to be assumed, or new
rights substituted therefor, by the acquiring or surviving corporation in such
Change of Control.
ARTICLE VIII
Modification, Extension and Renewal of Awards
Subject to the terms and conditions and within the limitations of the
Plan, the Committee may modify, extend or renew outstanding Awards, or, if
authorized by the Board, accept the surrender of outstanding Awards (to the
extent not yet exercised) granted under the Plan and authorize the granting of
new Awards pursuant to the Plan in substitution thereof, and the substituted
Awards may specify a lower exercise price than the surrender Awards, a longer
term than the surrendered Awards or may contain any other provisions that are
authorized by the Plan. The Committee may also modify the terms of an
outstanding Agreement. Notwithstanding the foregoing, however, no modification
of an Award, shall, without the consent of the Participant, adversely affect the
rights or obligations of the Participant.
ARTICLE IX
Amendment, Modification and Termination of Plan
9.1 Amendment, Modification and Termination. At any time and from time to
time, the Board may terminate, amend, or modify the Plan. Such amendment or
modification may be without shareholder approval except to the extent that such
approval is required by the Code, pursuant to the rules under Section 16 of the
Exchange Act, by any national securities exchange or system on which the Stock
is then listed or reported, by an regulatory body having jurisdiction with
respect thereto or under any other applicable laws, rules or regulations.
9.2 Awards Previously Granted. No termination, amendment or modification
of the Plan other than pursuant to Section 4.4 herein shall in any manner
adversely affect any Award therefore granted under the Plan, without the written
consent of the Participant.
ARTICLE X
Withholding
10.1 Tax Withholding. The Company shall have the power and the right to
deduct or withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy Federal, State and local taxes (including the
Participant's FICA obligation) required by law to be withheld with respect to
any grant, exercise, or payment made under or as a result of this Plan.
10.2 Stock Withholding. With respect to withholding required upon the
exercise of Non-qualified Stock Options, or upon the occurrence of any other
similar taxable event, participants may elect, subject to the approval of the
Committee, to satisfy the withholding requirement, in whole or in part, by
having the Company withhold Shares of Stock having a Fair Market Value equal to
the amount required to be withheld. The value of the Shares to be withheld shall
be based on Fair Market Value of the Shares on the date that the amount of tax
to be withheld is to be determined. All elections shall be irrevocable and be
made in writing, signed by the Participant on forms approved by the Committee in
advance of the day that the transaction becomes taxable.
ARTICLE XI
Successors
All obligations of the Company under the Plan, with respect to Awards
granted hereunder, shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation or otherwise, of all or substantially all of the business
and/or assets of the Company.
ARTICLE XII
General
12.1 Requirements of Law. The granting of Awards and the issuance of
Shares of Stock under this Plan shall be subject to all applicable laws, rules,
and regulations, and to such approvals by any governmental agencies as may be
required.
12.2 Effect of Plan. The establishment of the Plan shall not confer upon
any Key Employee any legal or equitable right against the Company, a Subsidiary
or the Committee, except as expressly provided in the Plan. The Plan does not
constitute an inducement or consideration for the employment of any Key
Employee, nor is it a contract between the Company or any of its Subsidiaries
and any Key Employee. Participation in the Plan shall not give any Key Employee
any right to be retained in the service of the Company or any of its
Subsidiaries.
12.3 Creditors. The interests of any Participant under the Plan or any
Agreement are not subject to the claims of creditors and may not, in any way, be
assigned, alienated or encumbered.
12.4 Governing Law. The Plan, and all Agreements hereunder, shall be
governed, construed and administered in accordance with and governed by the laws
of the Commonwealth of Virginia and the intention of the Company is that ISOs
granted under the Plan qualify as such under Section 422 of the Code.
12.5 Severability. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.