EXHIBIT 4.3
C&F FINANCIAL CORPORATION
1999 REGIONAL DIRECTOR STOCK COMPENSATION PLAN
C&F FINANCIAL CORPORATION
1999 REGIONAL DIRECTOR STOCK COMPENSATION PLAN
ARTICLE I
DEFINITIONS
1.01. Regional Board means the group known as the regional board of the Citizens
and Commerce Bank, which is a division of the Bank, or any other regional board
of the Company, the Bank (including any other division of the Bank) or any other
Subsidiary approved by the Committee for participation in the Plan.
1.02. 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").
1.03. Agreement means a written agreement (including any amendment or supplement
thereto), sometimes referred to an Memorandum of Option, between the Company and
a Participant specifying the terms and conditions of an Award granted to such
Participant.
1.04. Award means an award of Options as provided for hereunder.
1.05. Bank means Citizens and Farmers Bank, or its successors.
1.06. Beneficial Owner shall have the meaning ascribed to such term in Rule
13d-3 under the Exchange Act.
1.07. Board means the Board of Directors of the Company.
1.08. 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 any 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 shall change such that a majority of the Board shall no
longer consist of Continuing Directors; or
(iii) if at any time, (1) the Company shall consolidate with,
or merge with, any other Person and the Company shall not be the
continuing or surviving corporation, (2) 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 Common Stock shall be changed into or exchanged for
stock or other securities of any other Person or cash or any other
property, (3) the Company shall be a party to a statutory share
exchange with any other Person after which the Company is a subsidiary
of any other Person, or (4) 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.
1.09. Code means the Internal Revenue Code of 1986, as amended.
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1.10. Common Stock means the common stock of the Company.
1.11. Company means C&F Financial Corporation, or its successors.
1.12. Continuing Director means an individual who was a member of the Board on
the Effective Date or whose subsequent nomination for election or re-election to
the Board was recommended or approved by the affirmative vote of two-thirds of
the Continuing Directors then in office.
1.13. Date of Grant means each date as of which an Award is made under the Plan.
1.14. Fair Market Value means the closing price (or, if there are no trades on
the Date of Grant, then the next preceding date upon which a closing price is
available) of the Common Stock as reported on NASDAQ (or other applicable
listing service or exchange used by the Company) on the Option's Date of Grant,
or if in the judgment of the Committee there is insufficient recent trading
activity to warrant determination of the Fair Market Value solely on the basis
of such closing prices on the listing service or exchange, then the Fair Market
Value shall be determined as of the Date of Grant in good faith by the
Committee.
1.15. Option means a stock option granted pursuant to Article IV, and that
entitles the holder to purchase from the Company a stated number of shares of
Common Stock at the shares' Fair Market Value.
1.16. Participant means a member of the Regional Board who is not an employee
of, or member of the Board of Directors of, the Company, the Bank or any other
Subsidiary on the applicable Date of Grant; provided, persons serving on more
than one regional board shall be entitled to participate only as to one Award
under the Plan per year.
1.17. 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).
1.18. Plan means the C&F Financial Corporation 1999 Regional Director Stock
Compensation Plan.
1.19. 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.
ARTICLE II
PURPOSE
The Plan is intended to promote a greater identity of interest between
Participants and the Company's shareholders by increasing the Participants'
proprietary interest in the Company through the receipt of Awards in the form of
Options.
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ARTICLE III
ADMINISTRATION
The Plan shall be administered by a Stock Option Committee consisting
of one or more persons appointed by the Board who are members of the Board (the
"Committee"), and such employees as the Committee shall appropriately designate,
who shall have complete authority to interpret all provisions of this Plan; to
prescribe the form of Agreements; to adopt, amend, and rescind rules and
regulations pertaining to the administration of the Plan; and to make all other
determinations necessary or advisable for the administration of this Plan. Any
decision made, or action taken, by the Committee in connection with the
administration of this Plan shall be final and conclusive. All expenses of
administering this Plan shall be borne by the Company.
ARTICLE IV
GRANT OF OPTIONS
4.01. Initial Awards. At the first meeting of the Committee after the Effective
Date, Options for 1,000 shares of Stock shall be granted to persons then serving
on the Regional Board.
4.02. Discretionary Awards. Subject to the terms and provisions of the Plan,
Options may be granted 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.
ARTICLE V
STOCK SUBJECT TO OPTIONS
Upon the exercise of any Option, the Company may deliver to the
Participant (or the Participant's broker if the Participant so directs)
authorized but unissued Common Stock. The maximum aggregate number of shares of
Common Stock that may be issued pursuant to the exercise of Options under this
Plan is 25,000, subject to adjustment as provided in Article IX. If an Option is
terminated, in whole or in part, for any reason other than its exercise, the
number of shares of Common Stock allocated to the Option or portion thereof may
be reallocated to other Options to be granted under this Plan.
ARTICLE VI
OPTION PRICE
The price per share for Common Stock purchased on the exercise of an
Option shall be the share's Fair Market Value.
ARTICLE VII
EXERCISE OF OPTIONS
7.01. Maximum Option Period. No Option shall be exercisable after the expiration
of ten years from its Date of Grant.
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7.02. Nontransferability. Options granted under this Plan shall be
nontransferable except by will or by the laws of descent and distribution.
During the lifetime of the Participant to whom the Option is granted, the Option
may be exercised only by the Participant. No right or interest of a Participant
in any Option shall be liable for, or subject to, any lien, obligation, or
liability of such Participant.
ARTICLE VIII
METHOD OF EXERCISE OF OPTIONS
8.01. Exercisability of Options. Subject to the provisions of Section 8.04 and
Articles VII and X hereof, one-third of each Option shall become exercisable on
the first anniversary of its Date of Grant, the second one-third of each Option
shall become exercisable on the second anniversary of its Date of Grant, and the
final one-third of each Option shall become exercisable on the third anniversary
of its Date of Grant. However, an Option granted to a Participant shall be
immediately exercisable in full if the Participant's membership on the Regional
Board terminates as a result of the Participant's retirement in accordance with
the Regional Board's or the Company's, the Bank's or any other Subsidiary's
applicable policy, death or permanent and total disability (as such term is
defined in Section 22(e)(3) of the Code) or upon the occurrence of a Change in
Control. An Option shall be forfeited if, as of the termination of the
Participant's membership on the Regional Board, the Option is not then
exercisable and such termination occurs for any reason other than the
Participant's retirement in accordance with the Regional Board's or the
Company's, the Bank's or any other Subsidiary's applicable policy, death or
disability (as defined above) or the occurrence of a Change in Control. For
purposes of determining exercisability and forfeiture, promotion to service on
the board of directors of the Company, the Bank or another Subsidiary of the
Company will be considered continuing service as an Regional Director. Options
that are exercisable or that become exercisable upon the Participant's
termination of membership on the Regional Board will remain exercisable until
the tenth anniversary of the Option's Date of Grant. An Option may be exercised
with respect to any number of whole shares less than the full number for which
the Option could be exercised. A partial exercise of an Option shall not affect
the right to exercise the Option from time to time in accordance with this Plan
and the applicable Agreement with respect to the shares remaining subject to the
Option.
8.02. Payment. Unless otherwise provided by the Agreement, payment of the Option
price shall be made in cash or a cash equivalent acceptable to the Committee. In
addition, to the extent provided in the Agreement or otherwise permitted by the
Committee, all or part of the Option price may be paid by surrendering shares of
Common Stock to the Company. If Common Stock is used to pay all or part of the
Option price, the shares surrendered must have a fair market value that is not
less than such price or part thereof. For purposes of this paragraph 8.02 only,
the fair market value of the surrendered shares shall be based on the closing
price on the most recent date immediately prior to the date of exercise (or, if
there are no trades on such date, then the next preceding date upon which a
closing price is available) of the Common Stock as reported on NASDAQ (or other
applicable listing service or exchange used by the Company).
8.03. Shareholder Rights. No Participant shall have any rights as a shareholder
with respect to shares subject to his Option until the date of exercise of such
Option.
8.04. 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
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so that such Award may be exercised or realized in full on or before a date
initially fixed; (ii) provide for the purchase or settlement of any such Award
by the Company, upon a Participant's request, for an 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
exercisable 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 in Control.
ARTICLE IX
ADJUSTMENT UPON CHANGE IN COMMON STOCK
The maximum number of shares to which Awards may be granted under this
Plan shall be proportionately adjusted, and the terms of outstanding Awards
shall be adjusted, as the Committee shall determine to be equitably required in
the event that the Company (a) effects one or more stock dividends, stock
split-ups, subdivisions or consolidations of shares or (b) engages in a
transaction to which Section 424(a) of the Code applies. Any determination made
under this Article IX by the Committee shall be final and conclusive.
The issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any 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, or upon conversion of shares of obligations
of the Company convertible into such shares or other securities, shall not
affect, and no adjustment by reason thereof shall be made with respect to,
outstanding Awards.
ARTICLE X
COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES
No Option shall be exercisable, no Common Stock shall be issued, no
certificates for shares of Common Stock shall be delivered, and no payment shall
be made under this Plan except in compliance with all applicable federal and
state laws and regulations (including, without limitation, withholding tax
requirements), and applicable requirements of any exchange or other market
having authority over the trading of the Company's shares.
ARTICLE XI
GENERAL PROVISIONS
11.01. Effect on Service. Neither the adoption of this Plan, its operation,
documents describing or referring to this Plan (or any part thereof) shall
confer on any Participant any right to continue service as a member of the
Regional Board.
11.02. Unfunded Plan. The Plan, insofar as it provides for grants, shall be
unfunded and the Company shall not be required to segregate any assets that may
be represented at any time by grants under this Plan. Any liability of the
Company to any person with respect to any grant under this Plan shall be based
solely upon any contractual obligations that are created pursuant to this Plan.
No such obligation of the Company shall be deemed to be secured by any pledge
of, or other encumbrance on, any property of the Company.
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11.03. Rules of Construction. Headings are given to the articles and sections of
the Plan solely as a convenience to facilitate reference. The reference to any
statute, regulation, or provision of law shall be construed to refer to any
amendment to or successor of such provision of law.
ARTICLE XII
AMENDMENT
The Board may amend this Plan from time to time; provided that, if the
Board determines that shareholder approval is required and the Plan is submitted
for such approval and adopted, then no subsequent amendment may become effective
until shareholder approval is obtained if the amendment (i) materially increases
the aggregate number of shares of Common Stock that may be issued under the
Plan, except in accordance with the provisions of Article IX, (ii) materially
changes the class of individuals eligible to become Participants or (iii)
materially increases the benefits that may accrue to Participants under the
Plan, and provided further that the Board may not amend the Plan more than once
in any six month period unless such amendment is required to comply with the
Code. No amendment shall, without a Participant's consent, adversely affect any
rights of such Participant under any Option outstanding at the time such
amendment is made.
ARTICLE XIII
TERMINATION
The Board may terminate this Plan at any time. This Plan will terminate
automatically, without any action of the Board, if, on any Date of Grant, there
are insufficient shares available for the grant of Awards in accordance with the
terms of the Plan. The termination of this Plan shall not affect any rights of a
Participant under any Option outstanding at the time of such termination.
ARTICLE XIV
DURATION OF PLAN
No Award may be granted under this Plan after ten years from the
Effective Date of the Plan. Options granted on or before such date shall remain
valid in accordance with their terms.
ARTICLE XV
EFFECTIVE DATE OF PLAN
This Plan was approved by the Board of Directors of the Company on
October 19, 1999. The Effective Date of the Plan shall be October 19, 1999 and
no Awards may be granted prior to the Effective Date.
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