Exhibit 4.3
LONG-TERM CAPITAL ACCUMULATION PLAN
PLAN DOCUMENT
1.0 PLAN OBJECTIVES
1.1 Provide a balance between short-term and long-range
performance objectives.
1.2 Provide strong financial incentive for key management
to achieve long-term corporate objectives that relate
to Broad National Bank's profitability and growth
results.
1.3 Provide an additional opportunity for increasing the
Awards based on increased shareholder value.
2.0 PARTICIPATION
2.1 Participation is limited to Top Management (the
Chairman/Chief Executive officer and President/Chief
Operating Officer of Broad National Bank, constituting
Tier 1 of the Bank) and Senior Management (the senior
officers of Broad National Bank constituting Tier II of
the Bank), as selected and approved by the Committee of
disinterested outside directors constituted pursuant to
Section 5.1 below (the "Plan Administrators").
2.2 A participant must be actively employed at the
conclusion of the three (3) year Performance Period in
order to be eligible to receive an Award. Participants
whose employment terminates during the Performance
Period will forfeit all Awards for such Performance
Period. The Plan Administrators at their sole
discretion may provide an Award under the terms of the
Plan.
3.0 PERFORMANCE AWARDS
3.1 The Performance Period cycles over three (3) years, and
for the first Performance Period, will commence on
January 1, 1996 and end on December 31, 1998. The Plan
will cycle two additional times, January 1, 1999
through December 31, 2001, and January 1, 2002 through
December 31, 2004, for a total of nine (9) years.
1996 1997 1998 1999 2000 2001 2002 2003 2004
P A D
P A D
P A
P = Performance measure established A = Award earned
D = Award distributed
3.2 Awards are specified at the beginning of each
three (3) year Performance Period and earned at
the end of the period.
3.3 Performance will be measured against increases in
shareholder value over the three (3) year
Performance Period, as indicated by Return on
Equity, as well as the Bank's Efficiency Ratio,
equal to or better than peer banks. The Plan
Administrators will establish appropriate peer
banks for each specific Performance Period. In
addition, the Plan Administrators may select other
similar performance indices, as necessary.
3.4 Three (3) year Awards are equal to a percentage of
a participant's base salary at the beginning of
the Performance Period, as follows:
TIER I -- CEO AND PRESIDENT 100%
TIER II -- SENIOR MANAGEMENT 70%
3.5 Threshold performance will be determined at the
beginning of the Performance Period by the Plan
Administrators and must be met before any Awards
will be paid.
3.6 Awards will be paid in a combination of 60% stock
and 40% cash, with the cash portion being awarded
to offset the potential tax liability. The Plan
Administrators may, prior to the beginning of any
Performance Period, change the ratios of stock to
cash for that period.
3.7 For purposes of determining the number of shares
of stock to be paid as part of the Award, the
stock price will be the average closing sale price
of Broad National Bancorporation's Common Stock
over the prior 30 business days preceding the
beginning of each Performance Period. The stock
price (regardless of whether at the beginning or
the end of the Performance Period) has no effect
on the aggregate Award being distributed to a
participant, although the stock price at the
beginning of the Performance Period as determined
pursuant to the immediately preceding sentence is
relevant for the purposes of determining the
number of shares issued as part of an Award. For
example, if an aggregate Award of $100,000 is
being distributed to a participant in the form of
$60,000 of stock and $40,000 in cash, the number
of shares of stock so issued to the participant
shall be determined by dividing $60,000 by the
stock price at the beginning of the Performance
Period. If such stock price is $10 per share, for
example, a total of 6,000 shares would be issued
(regardless of the stock price at the end of the
Performance Period or as of the date the stock is
issued). For income tax purposes, however, the
shares will be valued as of the date vested.
3.8 Awards paid in stock will become immediately
vested on the date of issuance, and participants
will have full rights to the stock (dividends and
voting rights). However, the stock may not be
sold, transferred, or collateralized for three
years from the date of issuance, under any
circumstances, without the prior approval of the
Plan Administrators. Regardless of whether the
prior approval of the Plan Administrators has been
obtained for any sale, transfer or
collateralization of stock, all shares issued to a
participant under the Plan must be held at least
six months from the date of issuance before any
such sale, transfer or collateralization may be
made. Any resale must be in accordance with
Federal and State Securities Laws.
3.9 Awards may be increased based on the level of
performance actually achieved, subject to the
determination of the Plan Administrators. The
aggregate number of shares of Broad National
Bancorporation Common Stock that may be awarded
under the Plan is limited to 400,000 shares,
subject to increase or decrease in the event of a
change in the capital structure of Broad National
Bancorporation.
3.10 Additional Plan Feature:
a. At the sole discretion of the Plan Administrators,
an additional feature may be included that will
increase the Earned Awards under the Plan, based
on above average increases in shareholder value.
4.0 AWARD DISTRIBUTION
4.1 Awards will be calculated and paid within a
reasonable period following the end of the three
(3) year period for which the Awards have been
earned.
4.2 The Bank will make appropriate withholding for
income taxes on Awards.
4.3 A participant who has been involuntary terminated,
other than for Cause, may be eligible to receive a
prorated Award at the end of the Performance
Period, as long as he/she has at least one year
participation in the Plan.
4.4 Participants terminated for cause will immediately
forfeit any Earned Awards not yet paid, and they
are ineligible to receive any Award regardless of
the Bank's performance.
4.5 In the event of the death, total disability or
retirement of a participant during the Performance
Period, a pro-rated Award may be paid at the
conclusion of the three (3) year period based on
overall results, if earned, at the determination
of the Plan Administrators.
4.6 If a participant is demoted during the Performance
Period into an ineligible position, he/she may be
eligible to receive a prorated Award at the end of
the Performance Period, as long as he/she has at
least one year participation in the Plan. If a
participant is promoted into a position where the
eligibility and Target Award changes, he/she may
receive, at the discretion of the Plan
Administrator, the higher Award. If the
participant is promoted into an eligible position,
and his/her participation in the Plan has been
approved by appropriate management, he/she may be
eligible to receive a pro-rated Award, subject to
the determination of the Plan Administrators.
4.7 Each participant would agree to sign an investment
undertaking with respect to any shares issued, if
requested by Broad National Bancorporation, and to
have a legend placed on the certificate(s) for
such participant's stock to prevent resale thereof
in violation of Federal or State Securities Laws.
4.8 In the event of any merger transaction in which
Broad National Bancorporation is not the surviving
organization, the Performance Period shall
terminate and Awards shall be prorated by the Plan
Administrators.
4.9 Awards may be adjusted to reflect changes in the
equity structure of the Bank that may affect the
number of outstanding shares (i.e., stock
dividends, stock splits, combination or exchange
of shares, merger, consolidation or other change
in capitalization with a similar effect upon the
Plan or the Awards granted under the Plan). The
Plan Administrators shall have the power and sole
discretion to determine the nature and amount of
the adjustment to be made in each case.
5.0 GENERAL
5.1 The Plan Administrators, consisting of a Committee
comprised of two or more disinterested outside
directors, shall be responsible for the
implementation and on-going administration of the
Plan.
5.2 Interpretation of all matters related to this
Plan, including but not limited to eligibility,
selection of participants, and the timing of the
calculation and determination of Awards, as well
as the resolution of any questions relating to
accounting procedures of the Plan, shall be at the
sole and final determination of the Plan
Administrators.
5.3 The Bank may amend or discontinue this Plan at any
time in respect to future Awards; however, any
Awards earned up to the date of modification or
termination will be distributed in accordance with
Plan provisions at the time they were earned.
5.4 Nothing in this Plan shall be interpreted as
giving any participant the right to be retained as
an employee of the Bank, or of limiting the Bank's
rights to control or terminate the service of any
employee at any time in the course of its
business.
5.5 This Plan shall be construed in accordance with
all applicable Federal, State, securities and
regulatory laws. In the event that any section,
or portion of a section, of the Plan shall be held
invalid, illegal, or unenforceable, that section,
or portion of that section, shall not affect any
other section hereof. This Plan shall be
construed and enforced as if the invalid, illegal,
or unenforceable section, or portion of the
section, had never been contained herein.