Registration No. 333-_____ As filed with the Commission on October 20, 2000
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------
Webster City Federal Bancorp
(Exact Name of Registrant as Specified in its Charter)
United States 42-1491186
----------
(State or Other Jurisdiction of Incorporation) (IRS Employer Identification No.)
820 Des Moines Street
Webster City, Iowa 50595-0638
(Address of Principal Executive Offices and Zip Code)
---------------------------
Webster City Federal Savings Bank and
WCF Financial, M.H.C. 1996 Stock Option Plan
(Full Title of the Plan)
Copies to:
Phyllis A. Murphy Robert B. Pomerenk, Esquire
President and Chief Executive Officer Luse Lehman Gorman Pomerenk & Schick
Webster City Federal Bancorp A Professional Corporation
820 Des Moines Street 5335 Wisconsin Ave., NW, #400
Webster City, Iowa 50595-0638 Washington, D.C. 20015
(515) 832-3071 (202) 274-2000
(Name, Address and Telephone
Number of Agent for Service)
---------------------------
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box. |X|
CALCULATION OF REGISTRATION FEE
Title of Securities Amount to be Proposed Proposed Amount of
to be Registered Registered (1) Maximum Maximum Registration Fee
Offering Price Per Aggregate Offering
Share Price
Common Stock,
par value $.10 76,000 shares (2) $12.75(3) $969,000 $270
per share
Common Stock,
par value $.01 19,000 shares (4) 11.25(5) 213,750 60
per share
Total 95,000 shares $1,182,750 $330
-------------
(1) Together with an indeterminate number of additional shares which may be
necessary to adjust the number of shares reserved for issuance pursuant to
the Webster City Federal Savings Bank and WCF Financial, M.H.C. 1996 Stock
Option Plan (the "Stock Option Plan") as the result of a stock split, stock
dividend or similar adjustment of the outstanding Common Stock of Webster
City Federal Bancorp pursuant to 17 C.F.R. ss. 230.416(a).
(2) Represents the number of shares currently reserved for issuance for options
granted pursuant to the Stock Option Plan.
(3) Determined by the exercise price of options pursuant to 17
C.F.R.ss.230.457(h)(1).
(4) Represents the number of shares reserved for issuance for options which
have not been granted pursuant to the Stock Option Plan.
(5) Determined by reference to the fair market value of the common stock on
October 19, 2000, pursuant to 17 C.F.R. ss.230.457(c).
------------------------------------
This Registration Statement shall become effective upon filing in
accordance with Section 8(a) of the Securities Act of 1933 and 17 C.F.R. ss.
230.462.
2
PART I.
Items 1 and 2. Plan Information and Registrant Information and Employee Plan
Annual Information
This Registration Statement relates to the registration of 95,000 shares of
common stock of Webster City Federal Bancorp (the "Company") reserved for
issuance and delivery upon the exercise of options under the Webster City
Federal Savings Bank and WCF Financial, M.H.C. 1996 Stock Option Plan. The
documents containing the information specified in Part I of this Form S-8 have
been or will be sent or given to participants in the Stock Option Plan as
specified by Rule 428(b)(1) promulgated by the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Securities Act").
Such documents are not filed with the Commission either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424 in reliance on Rule 428.
PART II.
Item 3. Incorporation of Documents by Reference
The following documents previously or concurrently filed by the Company
with the Commission are hereby incorporated by reference in this Registration
Statement:
(a) the Company's Annual Report on Form 10-KSB for the year ended December 31,
1999 (File No. 0-26577) filed pursuant to Rule 13a-1 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act");
(b) all other reports filed by the Company pursuant to Section 13(a) or 15(d)
of the Exchange Act since the end of the year covered by the Annual Report
referred to above;
(c) the Company's definitive Proxy Statement for its Annual Meeting of
Stockholders held on April 19, 2000;
(d) the description of the common stock, par value $.10 per share, of the
Company contained in the Company's Current Report on Form 8-KSB filed with
the Commission on July 1, 1999, and all amendments or reports filed for the
purpose of updating such description.
All documents subsequently filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act, after the
date hereof, and prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or which deregisters
all securities then remaining unsold, shall be deemed incorporated by reference
into this Registration Statement and to be a part thereof from the date of the
filing of such documents. Any statement contained in the documents incorporated,
or deemed to be incorporated, by reference herein or therein shall be deemed to
be modified or superseded for purposes of this Registration Statement and the
prospectus to the extent that a statement contained herein or therein or in any
other subsequently filed document which also is, or is deemed to be,
incorporated by reference herein or therein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement and the prospectus.
The Company shall furnish without charge to each person to whom the
prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the documents incorporated by reference, other than exhibits to
such documents (unless such exhibits are specifically incorporated by reference
to the information that is incorporated). Requests should be directed to Phyllis
A. Murphy, President and Chief Executive Officer, Webster City Federal Bancorp,
820 Des Moines Street, Webster City, Iowa 50595-0638, Tel. (515) 832-3071.
All information appearing in this Registration Statement and the prospectus
is qualified in its entirety by the detailed information, including financial
statements, appearing in the documents incorporated herein or therein by
reference.
3
Item 4. Description of Securities
Not applicable.
Item 5. Interests of Named Experts and Counsel
None.
Item 6. Indemnification of Directors and Officers
Generally, federal regulations define areas for indemnity coverage for
federal savings associations, and proposed federal regulations define areas for
indemnity coverage for federal MHC subsidiary holding companies, as follows:
(a) Any person against whom any action is brought by reason of the fact
that such person is or was a director or officer of the institution shall
be indemnified by the institution for:
(i) Reasonable costs and expenses, including reasonable attorneys'
fees, actually paid or incurred by such person in connection with
proceedings related to the defense or settlement of such action;
(ii) Any amount for which such person becomes liable by reason of any
judgment in such action;
(iii) Reasonable costs and expenses, including reasonable attorneys'
fees, actually paid or incurred in any action to enforce his rights
under this section, if the person attains a final judgment in favor of
such person in such enforcement action.
(b) Indemnification provided for in subparagraph (a) shall be made to such
officer or director only if the requirements of this subsection are met:
(i) The institution shall make the indemnification provided by
subparagraph (a) in connection with any such action which results in a
final judgment on the merits in favor of such officer or director.
(ii) The institution shall make the indemnification provided by
subparagraph (a) in case of settlement of such action, final judgment
against such director or officer or final judgment in favor of such
director or officer other than on the merits except in relation to
matters as to which he shall be adjudged to be liable for negligence
or misconduct in the performance of duty, only if a majority of the
directors of the institution determines that such a director or
officer was acting in good faith within what he was reasonably
entitled to believe under the circumstances was the scope of his
employment or authority and for a purpose which he was reasonably
entitled to believe under the circumstances was in the best interest
of the institution or its members.
(c) As used in this paragraph:
(i) "Action" means any action, suit or other judicial or
administrative proceeding, or threatened proceeding, whether civil,
criminal, or otherwise, including any appeal or other proceeding for
review;
(ii) "Court" includes, without limitation, any court to which or in
which any appeal or any proceeding for review is brought;
(iii) "Final Judgment" means a judgment, decree, or order which is
appealable and as to which the period for appeal has expired and no
appeal has been taken;
4
(iv) "Settlement" includes the entry of a judgment by consent or by
confession or upon a plea of guilty or of nolo contendere.
Item 7. Exemption From Registration Claimed
Not applicable.
Item 8. List of Exhibits
Regulation S-B Reference to Prior Filing or
Exhibit Number Document Exhibit No. Attached Hereto
- -------------- -------- ---------------------------
4 Specimen form of common stock *
certificate of Webster City Federal
Bancorp
5 Opinion of Luse Lehman Gorman Attached as Exhibit 5
Pomerenk & Schick, P.C.
10 Webster City Federal Savings Bank
and WCF Financial, M.H.C.1996 Stock
Option Plan Attached as Exhibit 10
15 Letter on unaudited interim financial
information Not Applicable
23.1 Consent of Luse Lehman Gorman Pomerenk Contained in Exhibit 5
& Schick, P.C.
23.2 Consent of KPMG, LLP Attached as Exhibit 23.2
24 Power of Attorney Contained on Signature Page
* Filed as an exhibit to the Company's Current Report on Form 8-KSB (File No.
0-26577) filed with the Commission on July 1, 1999.
Item 9. Undertakings
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
this Registration Statement or any material change to such information in this
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;
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
Stock Option Plan;
4. 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 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities
5
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof; and
5. 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.
6
EXHIBIT INDEX
Exhibit Number Description
5 Opinion of Luse Lehman Gorman Pomerenk & Schick, A
Professional Corporation as to the legality of the
Common Stock registered hereby.
10 Webster City Federal Savings Bank and WCF Financial, M.H.C.
1996 Stock Option Plan
23.1 Consent of Luse Lehman Gorman Pomerenk & Schick,
A Professional Corporation (contained in the opinion included
as Exhibit 5)
23.2 Consent of KPMG, LLP
7
SIGNATURES
The Registrant. 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 Webster City, Iowa, on this 18th day of October, 2000.
Webster City Federal Bancorp
By: /s/Phyllis A. Murphy
-------------------------------------
Phyllis A. Murphy, President and
Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned directors and officers of Webster City Federal Bancorp
(the "Company") hereby severally constitute and appoint Phyllis A. Murphy as our
true and lawful attorney and agent, to do any and all things in our names in the
capacities indicated below which said Phyllis A. Murphy may deem necessary or
advisable to enable the Company to comply with the Securities Act of 1933, and
any rules, regulations and requirements of the Securities and Exchange
Commission, in connection with the registration statement on Form S-8 relating
to the offering of the Company's Common Stock, including specifically, but not
limited to, power and authority to sign for us in our names in the capacities
indicated below the registration statement and any and all amendments (including
post-effective amendments) thereto; and we hereby approve, ratify and confirm
all that said Phyllis A. Murphy shall do or cause to be done by virtue thereof.
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 as of the dates indicated.
Signatures Title Date
/s/Phyllis A. Murphy President, Chief Executive October 18, 2000
- ------------------------- Officer and Director
Phyllis A. Murphy (Principal Executive Officer)
/s/Stephen L. Mourlam Executive Vice President October 18, 2000
- ------------------------- (Principal Financial and
Stephen L. Mourlam Accounting Officer)
/s/Ellis S. Swon Chairman of the Board October 18, 2000
- -------------------------
Ellis S. Swon
/s/Donald I. Newman Director October 18, 2000
- -------------------------
Donald I. Newman
/s/Dennis J. Tasler Director October 18, 2000
- -------------------------
Dennis J. Tasler
/s/Dr. Carroll E. Haynes Director October 18, 2000
- -------------------------
Dr. Carroll E. Haynes
EXHIBIT 5
OPINION OF LUSE LEHMAN GORMAN POMERENK & SCHICK, P.C.
October 20, 2000
Board of Directors
Webster City Federal Bancorp
820 Des Moines Street
Webster City, Iowa 50595
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
You have requested the opinion of this firm as to certain matters in
connection with the offer and sale of Webster City Federal Bancorp (the
"Company") common stock, par value $.10 per share (the "Common Stock"), pursuant
to the Webster City Federal Savings Bank 1996 Stock Option Plan. We have
reviewed the Company's Certificate of Incorporation, Registration Statement on
Form S-8 (the "Form S-8"), as well as applicable statutes and regulations
governing the Company and the offer and sale of the Common Stock.
Based on the foregoing, we are of the following opinion:
Upon the effectiveness of the Form S-8, the Common Stock, when sold in
connection with the exercise of options granted pursuant to the plan, will
be legally issued, fully paid and non-assessable.
This opinion has been prepared solely for the use of the Company in
connection with the preparation and filing of the Form S-8, and should not be
used for any other purpose or relied upon by any other person without the prior
written consent of this firm. We hereby consent to the use of this opinion in
the Form S-8.
Very truly yours,
/s/ Luse Lehman Gorman Pomerenk & Schick
Luse Lehman Gorman Pomerenk & Schick
A Professional Corporation
EXHIBIT 10
STOCK OPTION PLAN
WEBSTER CITY FEDERAL SAVINGS BANK
and WCF FINANCIAL, M.H.C.
1996 STOCK OPTION PLAN
1. Purpose
The purpose of the Webster City Federal Savings Bank and WCF Financial,
M.H.C. 1996 Stock Option Plan (the "Plan") is to advance the interests of
Webster City Federal Savings Bank (the "Bank") and its shareholders by providing
Employees and Outside Directors of the Bank and its affiliates, including WCF
Financial, M.H.C., the mutual holding company of the Bank (the "Company"), upon
whose judgment, initiative and efforts the successful conduct of the business of
the Bank and its affiliates largely depends, with an additional incentive to
perform in a superior manner as well as to attract people of experience and
ability to such positions with the Bank and the Company.
2. Definitions
"Affiliate" means any "parent corporation" or "subsidiary corporation" of
the Bank or the Company, as such terms are defined in Section 424(e) or 424(f),
respectively, of the Code.
"Award" means an Award of Nonstatutory Stock Options, Incentive Stock
Options, and/or Limited Rights granted under the provisions of the Plan.
"Beneficiary" means the person or persons designated by a Recipient to
receive any benefits payable under the Plan in the event of such Recipient's
death. Such person or persons shall be designated in writing on forms provided
for this purpose by the Committee and may be changed from time to time by
similar written notice to the Committee. In the absence of a written
designation, the Beneficiary shall be the Recipient's surviving spouse, if any,
or if none, his estate.
"Board of Directors" means the Board of Directors of the Bank and the
Company, as applicable.
"Change in Control" means:
(1)(i) A reorganization, merger, merger conversion, consolidation or sale
of all or substantially all of the assets of the Bank or the Company or a
similar transaction in which the Bank or Company is not the resulting entity or
the Stock Holding Company is not the resulting entity; (ii) individuals who
constitute the Board of Directors of the Bank or the Board of Directors of the
Company as of the date hereof (the "Incumbent Board"), cease for any reason to
constitute at least a majority thereof, provided that any person becoming a
director subsequent to the date hereof whose election was approved by a vote of
at least three-fourths of the directors composing the Incumbent Board or whose
nomination for election by the Bank's or Company's stockholders or members,
respectively, was approved by the Nominating Committee serving under an
Incumbent Board shall be for purposes of this section considered as though he
were a member of the Incumbent Board; or (iii) an acquisition of "control" of
the Bank or the Company as defined by the Home Owners Loan Act, as amended, and
applicable rules and regulations promulgated thereunder as in effect at the time
of the Change in Control (collectively, the "HOLA"), or (iv) an acquisition of
the Bank's stock requiring submission of notice under the Change in Bank Control
Act;
(2) In the event the Company converts from the mutual form of organization
to the stock form of organization in a Conversion Transaction at any time
subsequent to the effective date of this Plan, a "Change in Control" shall mean
a change in control of the Bank or the Stock Holding Company of a nature that:
(i) would be required to be reported in response to Item 1a of the current
report on Form 8-K, as in effect on the date hereof, pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 (the "Exchange Act"); or (ii)
results in a change in control of the Bank or the Stock Holding Company within
the meaning of the Bank Holding Company Act ("BHCA"); or (iii) without
limitation, results in (a) any "person" (as such term is used in Section 13(d)
and 14(d) of
10-1
the Exchange Act) becoming the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Bank or
the Stock Holding Company representing 25% or more of the Bank's or Stock
Holding Company's outstanding securities ordinarily having the right to vote at
the election of directors, except for any securities purchased by the Bank's or
the Stock Holding Company's employee stock benefit plans; or (b) the Incumbent
Board ceasing for any reason to constitute at least a majority of the Board of
Directors of the Bank or Stock Holding Company; or (c) results in a
reorganization, merger, consolidation, sale of all or substantially all of the
assets of the Bank or the Stock Holding Company or similar transaction.
Notwithstanding anything to the contrary herein, the conversion of the
Company to stock form, on a stand- alone basis, shall not be a Change in
Control.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the Stock Benefits Committee (or the equivalent) of the
Board of Directors consisting of at least three Outside Directors of the Bank or
the Company, and all of whom are and must be "disinterested directors" as that
term is defined under Rule 16b-3 under the Exchange Act.
"Common Stock" means the common stock of the Bank, par value $.10 per
share.
"Company" means WCF Financial, M.H.C.
"Conversion Transaction" means the conversion of the Company from the
mutual to stock form of organization either on a stand-alone basis or in the
context of a merger conversion with an unrelated entity, as contemplated by
regulations of the Office of Thrift Supervision ("OTS") or any successor
thereof.
"Date of Grant" means the actual date on which an Award is granted by the
Committee.
"Director" means a member of the Board of Directors.
"Disability" means the permanent and total inability by reason of mental or
physical infirmity, or both, of an Employee to perform the work customarily
assigned to him. Additionally, a medical doctor selected or approved by the
Board of Directors must advise the Committee that it is either not possible to
determine when such Disability will terminate or that it appears probable that
such Disability will be permanent during the remainder of such Employee's
lifetime.
"Employee" means any person who is currently employed by the Bank or the
Company or an Affiliate, including officers.
"Fair Market Value" means, when used in connection with the Common Stock on
a certain date, the reported closing price of the Common Stock as reported by
the National Association of Securities Dealers Automated Quotation ("Nasdaq")
"Small-Cap Issues" (as published by the Wall Street Journal, if published) on
such date, or if the Common Stock was not traded on such date, on the next
preceding day on which the Common Stock was traded; provided, however, that if
the Common Stock is not reported on the Nasdaq "Small-Cap Issues", Fair Market
Value shall mean the average sale price of all shares of Common Stock sold
during the 30-day period immediately preceding the date on which such stock
option was granted, and if no shares of stock have been sold within such 30-day
period, the average sale price of the last three sales of Common Stock sold
during the 90-day period immediately preceding the date on which such stock
option was granted. In the event Fair Market Value cannot be determined in the
manner described above, then Fair Market Value shall be determined by the
Committee. The Committee is authorized, but is not required, to obtain an
independent appraisal to determine the Fair Market Value of the Common Stock.
"Incentive Stock Option" means an Option granted by the Committee to an
Employee Participant, which Option is designated as an Incentive Stock Option
pursuant to Section 8.
"Limited Right" means the right to receive an amount of cash based upon the
terms set forth in Section 9.
10-2
"Nonstatutory Stock Option" means an Option granted by the Committee to (i)
an Outside Director or (ii) to any other Participant and such option is either
(A) not designated by the Committee as an Incentive Stock Option, or (B) fails
to satisfy the requirements of an Incentive Stock Option as set forth in Section
422 of the Code and the regulations thereunder.
"Normal Retirement" means, for an Employee, retirement at the normal or
early retirement date as set forth in the Bank's Employee Stock Ownership Plan,
or any successor plan. For an Outside Director, Normal Retirement means
retirement from service on the Board.
"Offering" means the initial public offering of the Common Stock of the
Bank.
"Option" means an Award granted under Section 7 or Section 8.
"Outside Director" means a Director who is not also an Employee.
"Participant" means an Outside Director or an Employee chosen by the
Committee to participate in the Plan.
"Reorganization" means the reorganization of Webster City Federal Savings
Bank as a mutual holding company and the establishment of the Bank as its
majority-owned subsidiary.
"Stock Holding Company" means the holding company resulting from a stock
conversion of the Company in a Conversion Transaction.
"Termination for Cause" means the termination of employment or service
caused by the individual's personal dishonesty, incompetence, willful
misconduct, any breach of a fiduciary duty involving personal profit or
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, or a material breach of a material provision hereof. In
the case of an Outside Director, Termination for Cause means a removal for cause
pursuant to the Bank's Bylaws.
3. Administration
The Plan shall be administered by the Committee. The Committee is
authorized, subject to the provisions of the Plan, to establish such rules and
regulations as it deems necessary for the proper administration of the Plan and
to make whatever determinations and interpretations in connection with the Plan
it deems necessary or advisable. All determinations and interpretations made by
the Committee shall be binding and conclusive on all Participants in the Plan
and on their legal representatives and beneficiaries.
The Awards of Nonstatutory Options to Outside Directors under Section 7 are
intended to comply with Rule 16b-3 under the Exchange Act. Notwithstanding any
term to the contrary appearing herein, unless permitted by Rule 16b-3(c)(2)(ii),
neither the Committee nor the Board of Directors shall have the authority to
determine the amount and price of securities to be awarded and/or timing of
awards under Section 7 to designated directors or categories of directors, which
terms shall be set forth herein. To the extent any provision of the Plan or
action by Plan administrators fails to comply with this Section 3, such
provision or action shall be deemed null and void to the extent permitted by law
and deemed advisable by the Board of Directors.
4. Types of Awards
Awards under the Plan may be granted in any one or a combination of (a)
Incentive Stock Options; (b) Non-Statutory Stock Options; and (c) Limited
Rights.
5. Stock Subject to the Plan
Subject to adjustment as provided in Section 14, the maximum number of
shares reserved for issuance under the Plan is ten percent (10%) of the shares
of Common Stock of the Bank sold in connection with the Offering (or 95,000
shares). The maximum number of shares reserved for issuance to Employees is
71,250 shares or 75.0% of
10-3
the shares of Common Stock issued in connection with the Offering. The maximum
number of shares reserved for issuance to Outside Directors is 23,750 shares or
25.0% of the shares of Common Stock issued in connection with the Offering.
The shares of Common Stock represented by such options may be either
authorized but unissued shares or shares previously issued and reacquired by the
Bank or the Company. The Company may use dividends received from the Bank to
fund the purchase of shares necessary to satisfy the exercise of stock options.
To the extent that options together with any related rights and Limited Rights
granted under the Plan terminate, expire or are cancelled without having been
exercised or, in the case of Limited Rights, without having been exercised for
cash, new Awards may be made with respect to shares underlying such options.
6. Eligibility
Employees shall be eligible to receive Incentive Stock Options,
Nonstatutory Stock Options and/or Limited Rights under the Plan. Outside
Directors shall not be eligible to receive Incentive Stock Options under the
Plan. Outside Directors shall be eligible to receive only Nonstatutory Stock
Options and Limited Rights.
7. Nonstatutory Stock Options
7.1 Grant of Nonstatutory Stock Options
(a) Grants to Outside Directors. Each Outside Director who is serving in
such capacity on the effective date of the Plan (the "Effective Date"), shall be
granted Options to purchase 4,750 shares of Common Stock of the Bank, subject to
adjustment pursuant to Section 14. Each person who becomes an Outside Director
subsequent to the Effective Date, shall be granted Nonstatutory Stock Options to
purchase 2,375 shares of the Common Stock, subject to adjustment pursuant to
Section 14, to the extent shares remain available under the Plan. Nonstatutory
Stock Options granted under the Plan are subject to the terms and conditions set
forth in this Section 7.
(b) Grants to Employees. The Committee may, from time to time, grant
Nonstatutory Stock Options to Employees and, upon such terms and conditions as
the Committee may determine, grant Nonstatutory Stock Options in exchange for
and upon surrender of previously granted Awards under the Plan. Nonstatutory
Stock Options granted under the Plan are subject to the terms and conditions set
forth in this Section 7.
(c) Option Agreement. Each Option shall be evidenced by a written option
agreement between the Bank and the Employee specifying the number of shares of
Common Stock that may be acquired through its exercise and containing such other
terms and conditions that are not inconsistent with the terms of this grant. The
maximum number of shares subject to a Nonstatutory Option that may be awarded
under the Plan to any Employee shall be 23,750.
(d) Price. The purchase price per share of Common Stock deliverable upon
the exercise of each Non-statutory Stock Option shall be determined by the
Committee on the date the Option is granted. Except as provided below, such
purchase price shall not be less than 100% of the Fair Market Value of the
Common Stock on the date the Option is granted. The purchase price per share of
Common Stock deliverable upon the exercise of each Nonstatutory Stock Option
granted in exchange for and upon surrender of previously granted Awards shall be
not less than 85% of the Fair Market Value of the Common Stock on the date the
Option is granted, but in no event may the purchase price of any Nonstatutory
Stock Option be less than the par value of the Common Stock. Shares may be
purchased only upon full payment of the purchase price. Payment of the purchase
price may be made, in whole or in part, through the surrender of shares of the
Common Stock at the Fair Market Value of such shares.
(e) Manner of Exercise. Nonstatutory Stock Options awarded to Outside
Directors shall vest in a Participant at the rate of thirty-three and one-third
percent (33.3%) per year commencing from the date of grant. The vested Option
may be exercised from time to time, in whole or in part, by delivering a written
notice of exercise to the President or Chief Executive Officer of the Bank. Such
notice is irrevocable and must be accompanied by full payment of the purchase
price in cash or shares of previously acquired Common Stock of the Bank at the
Fair Market Value of such shares determined on the exercise date.
10-4
(f) Terms of Options. The term during which each Nonstatutory Stock Option
may be exercised shall be determined by the Committee, but in no event shall a
Nonstatutory Stock Option be exercisable in whole or in part more than 10 years
and one day from the Date of Grant. The Nonstatutory Options awarded to
Employees shall be exercisable in installments, as determined by the Committee.
The Committee shall determine the date on which each installment shall become
exercisable. The shares comprising each installment may be purchased in whole or
in part at any time after such installment becomes exercisable. The Committee,
in its sole discretion, may accelerate the time at which any Nonstatutory Stock
Option awarded to Employees may be exercised in whole or in part, provided that
the Committee may not accelerate the time at which a Nonstatutory Stock Option
may be exercised due to retirement of such Employee. Notwithstanding the above,
in the event of a Change in Control, all Nonstatutory Stock Options shall become
immediately exercisable.
(g) Termination of Employment or Service. Upon the termination of an
Employee's employment or upon termination of an Outside Director's service for
any reason other than Normal Retirement, Disability, death, or Termination for
Cause, the Employee's or Outside Director's Nonstatutory Stock Options shall be
exercisable only as to those shares that were immediately purchasable by the
Employee or Outside Directors at the date of termination and only for a period
of one year following termination. In the event of Termination for Cause, all
rights under the Nonstatutory Stock Options shall expire upon termination. In
the event of the Normal Retirement, death or Disability of any Employee or
Outside Director, all Nonstatutory Stock Options held by such Employee or
Outside Director, whether or not exercisable at such time, shall be exercisable
by such person or his legal representatives or beneficiaries for one year
following the date of his death or cessation of employment or service, as
applicable, due to Disability or Normal Retirement, provided that in no event
shall the period extend beyond the expiration of the Nonstatutory Stock Option
term. Notwithstanding the above, all Nonstatutory Stock Options held by a
Participant whose employment as an Employee or service as an Outside Director
terminates following a Change in Control shall be deemed earned as of the last
day of employment or service with the Bank or an Affiliate and shall be
exercisable for one year following such termination of employment or service.
8. Incentive Stock Options
8.1 Grant of Incentive Stock Options
The Committee, from time to time, may grant Incentive Stock Options to
Employees. Incentive Stock Options granted pursuant to the Plan shall be subject
to the following terms and conditions:
(a) Option Agreement. Each Option shall be evidenced by a written option
agreement between the Bank and the Employee specifying the number of shares of
Common Stock that may be acquired through its exercise and containing such other
terms and conditions that are not inconsistent with the terms of this grant.
(b) Price. The purchase price per share of Common Stock deliverable upon
the exercise of each Incentive Stock Option shall be not less than 100% of the
Fair Market Value of the Common Stock on the date the Incentive Stock Option is
granted. However, if an Employee owns stock possessing more than 10% of the
total combined voting power of all classes of Common Stock (or under Section
424(d) of the Code, is deemed to own stock representing more than 10% of the
total combined voting power of all classes of stock of the Bank or its
Affiliates by reason of the ownership of such classes of common stock directly
or indirectly, by or for any brother, sister, spouse, ancestor or lineal
descendant of such Employee or by or for any corporation, partnership, estate or
trust of which such Employee is a shareholder, partner or beneficiary), the
purchase price per share of Common Stock deliverable upon the exercise of each
Incentive Stock Option shall not be less than 110% of the Fair Market Value of
the Common Stock on the date the Incentive Stock Option is granted. Shares may
be purchased only upon payment of the full purchase price. Payment of the
purchase price may be made, in whole or in part, through the surrender of shares
of the Common Stock. If previously acquired shares of Common Stock are tendered
in payment of all or part of the exercise price, the value of such shares shall
be determined as of the date of exercise of the Incentive Stock Option.
(c) Manner of Exercise. Incentive Stock Options granted under the Stock
Option Plan shall vest in a Participant at the rate or rates determined by the
Committee. The vested Option may be exercised from time to time, in whole or in
part, by delivering a written notice of exercise to the President or Chief
Executive Officer of the Bank,
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provided, however, that no Options shall be exercisable prior to approval of the
Plan by stockholders. Such notice is irrevocable and must be accompanied by full
payment of the purchase price in cash or shares of previously acquired Common
Stock. If previously acquired shares of Common Stock are tendered in payment of
all or part of the exercise price, the Fair Market Value of such shares shall be
determined as of the date of such exercise of the Incentive Stock Option.
(d) Amount of Options. Incentive Stock Options may be granted to any
Employee in such amounts as determined by the Committee; provided that the
amount granted is consistent with the terms of Section 422 of the Code.
Notwithstanding the above, the maximum number of shares that may be subject to
an Incentive Stock Option awarded under the Plan to any Employee shall be
23,750. In granting Incentive Stock Options, the Committee shall consider the
position and responsibilities of the Employee, the length and value of his or
her service to the Bank, the Company, or the Affiliate, the compensation paid to
the Employee and the Committee's evaluation of the performance of the Bank, the
Company, or the Affiliate, according to measurements that may include, among
others, key financial ratios, levels of classified assets, and independent audit
findings. In the case of an Option intended to qualify as an Incentive Stock
Option, to the extent required by Section 422 of the Code, the aggregate Fair
Market Value (determined as of the time the Option is granted) of the Common
Stock with respect to which Incentive Stock Options granted are exercisable for
the first time by the Participant during any calendar year (under all plans of
the Participant's employer corporation and its parent and subsidiary
corporations) shall not exceed $100,000. The provisions of this Section 8.1(d)
shall be construed and applied in accordance with Section 422(d) of the Code and
the regulations, if any, promulgated thereunder.
(e) Term of Options. The term during which each Incentive Stock Option may
be exercised shall be determined by the Committee, but in no event shall an
Incentive Stock Option be exercisable in whole or in part more than 10 years
from the Date of Grant. If any Employee, at the time an Incentive Stock Option
is granted to him, owns Common Stock representing more than 10% of the total
combined voting power of the Bank or its Affiliates (or, under Section 424(d) of
the Code, is deemed to own Common Stock representing more than 10% of the total
combined voting power of all such classes of Common Stock, by reason of the
ownership of such classes of Common Stock, directly or indirectly, by or for any
brother, sister, spouse, ancestor or lineal descendent of such Employee, or by
or for any corporation, partnership, estate or trust of which such Employee is a
shareholder, partner or beneficiary), the Incentive Stock Option granted to him
or her shall not be exercisable after the expiration of five years from the Date
of Grant. No Incentive Stock Option granted under the Plan is transferable
except by will or the laws of descent and distribution and is exercisable during
his lifetime only by the Employee to which it is granted.
The Committee shall determine the date on which each Incentive Stock Option
shall become exercisable and may provide that an Incentive Stock Option shall
become exercisable in installments. The shares comprising each installment may
be purchased in whole or in part at any time after such installment becomes
purchasable, provided that the amount able to be first exercised in a given year
is consistent with the terms of Section 422 of the Code. The Committee, in its
sole discretion, may accelerate the time at which any Incentive Stock Option may
be exercised in whole or in part; provided that it is consistent with the terms
of Section 422 of the Code. Notwithstanding the above, in the event of a Change
in Control, all Incentive Stock Options shall become immediately exercisable
unless the Fair Market Value of the amount exercisable as a result of a Change
in Control shall exceed $100,000 (determined as of the date of grant). In such
event, the first $100,000 of Incentive Stock Options (determined as of the date
of grant) shall be exercisable as Incentive Stock Options and any excess shall
be exercisable as Nonstatutory Stock Options.
(f) Termination of Employment. Upon the termination of an Employee's
employment for any reason other than Normal Retirement, Disability, Change in
Control, death, or Termination for Cause, his or her Incentive Stock Options
shall be exercisable only as to those shares that were immediately purchasable
by him at the date of termination and only for a period of three months
following termination. In the event of Termination for Cause, all rights under
his or her Incentive Stock Options shall expire upon termination.
In the event of termination of an Employee's employment due to a Change in
Control, Normal Retirement, death or Disability, all Incentive Stock Options
held by such Employee, whether or not exercisable at such time, shall be
exercisable by such Employee (or in the event of his death, his legal
representative or beneficiary) for one year following the date of his cessation
of employment; provided, however, that, to the extent prohibited by law, such
Options shall not be eligible for treatment as Incentive Stock Options in the
event such Options are exercised more
10-6
than three months following the Employee's cessation of employment. In no event
shall the exercise period extend beyond the expiration of the Incentive Stock
Option term.
(g) Compliance with Code. The Options granted under this Section 8 are
intended to qualify as Incentive Stock Options within the meaning of Section 422
of the Code, but the Bank makes no warranty as to the qualification of any
Option as an incentive stock option within the meaning of Section 422 of the
Code. If an Option granted hereunder fails for whatever reason to comply with
the provisions of Section 422 of the Code and such failure is not or cannot be
cured, such Option shall be a Nonstatutory Stock Option.
9. Limited Rights
9.1 Grant of Limited Rights
The Committee may grant a Limited Right simultaneously with the grant of
any Option to any Employee or Outside Director with respect to all or some of
the shares covered by such Option. Limited Rights granted under the Plan are
subject to the following terms and conditions:
(a) Terms of Rights. In no event shall a Limited Right be exercisable in
whole or in part before the expiration of six months from the date of grant of
the Limited Right. A Limited Right may be exercised only in the event of a
Change in Control.
The Limited Right may be exercised only when the underlying Option is
eligible to be exercised, provided that the Fair Market Value of the underlying
shares on the day of exercise is greater than the exercise price of the related
Option.
Upon exercise of a Limited Right, the related Option shall cease to be
exercisable. Upon exercise or termination of an Option, any related Limited
Rights shall terminate. The Limited Rights may be for no more than 100% of the
difference between the exercise price and the Fair Market Value of the Common
Stock subject to the underlying Option. The Limited Right is transferable only
when the underlying Option is transferable and under the same conditions.
(b) Payment. Upon exercise of a Limited Right, the holder shall promptly
receive from the Bank an amount of cash equal to the difference between the Fair
Market Value on the Date of Grant of the related Option and the Fair Market
Value of the underlying shares on the date the Limited Right is exercised,
multiplied by the number of shares with respect to which such Limited Right is
being exercised. In the event of a Change of Control in which pooling accounting
treatment is a condition to the transaction, the Limited Right shall be
exercisable solely for shares of stock of the Bank, or in the event of a merger
transaction, for shares of the acquiring corporation, or its parent, as
applicable. The number of shares to be received on the exercise of such Limited
Right shall be determined by dividing the amount of cash that would have been
available under the first sentence above by the Fair Market Value at the time of
exercise of the shares underlying the Option subject to the Limited Right.
10. Surrender of Option
In the event of a Participant's termination of employment or termination of
service as a result of death or Disability, the Participant (or his personal
representative(s), heir(s), or devisee(s)) may, in a form acceptable to the
Committee, make application to surrender all or part of the Options held by such
Participant in exchange for a cash payment from the Bank of an amount equal to
the difference between the Fair Market Value of the Common Stock on the date of
termination of employment or service and the exercise price per share of the
Option on the Date of Grant. Whether the Bank accepts such application or
determines to make payment, in whole or part, is within its sole discretion, it
being expressly understood that the Bank is under no obligation to any
Participant to make such payments. In the event that the Bank accepts such
application and determines to make payment, such payment shall be in lieu of the
exercise of the underlying Option and such Option shall cease to be exercisable.
10-7
11. Rights of a Shareholder; Non-transferability
A Participant shall have no rights as a shareholder with respect to any
shares covered by a Non-statutory and/or Incentive Stock Option until the date
of issuance of a stock certificate for such shares. Nothing in the Plan or in
any Award granted confers on any person any right to continue in the employ of
the Bank or its Affiliates or to continue to perform services for the Bank or
its Affiliates or interferes in any way with the right of the Bank or its
Affiliates to terminate his or her services as an Employee or Director at any
time.
No Award under the Plan shall be transferable by the optionee other than by
will or the laws of descent and distribution and may only be exercised during
his or her lifetime by the Participant, or by a guardian or legal representative
of the Participant.
12. Agreement with Participants
Each Award of Options, and/or Limited Rights shall be evidenced by a
written agreement, executed by the Participant and the Bank or its Affiliates
that describes the conditions for receiving the Awards including the date of
Award, the purchase price if any, applicable periods, and any other terms and
conditions as may be required by the Board of Directors or applicable securities
law.
13. Designation of Beneficiary
A Participant, with the consent of the Committee, may designate a person or
persons to receive, in the event of death, any Option or Limited Rights Award to
which he or she would then be entitled. Such designation will be made upon forms
supplied by and delivered to the Bank and may be revoked in writing. If a
Participant fails effectively to designate a Beneficiary, then his estate will
be deemed to be the Beneficiary.
14. Dilution and Other Adjustments
In the event of any change in the outstanding shares of Common Stock by
reason of any stock dividend or split, recapitalization, pro-rata return of
capital to all shareholders, merger, consolidation, spin-off, reorganization,
combination or exchange of shares, or other similar corporate change, or other
increase or decrease in such shares without receipt or payment of consideration,
the Committee will make such adjustments to previously granted Awards, to
prevent dilution or enlargement of the rights of the Participant, including any
or all of the following:
(a) adjustments in the aggregate number or kind of shares of Common Stock
that may be awarded under the Plan;
(b) adjustments in the aggregate number or kind of shares of Common Stock
covered by Awards already made under the Plan; or
(c) subject to Section 8.1(b), adjustments in the purchase price of
outstanding Incentive and/or Nonstatutory Stock Options, or any Limited
Rights attached to such options.
No such adjustments, however, may change materially the value of benefits
available to a Participant under a previously granted Award.
15. Limitations upon Exercise of Options
Notwithstanding any other provision of the Plan, so long as the Company
remains in the mutual form of organization and so long as any applicable statute
or regulation requires the Company to own at least a majority of the outstanding
shares of Common Stock, an Option granted under the Plan may not be exercised if
the exercise of such an Option would result in the Company owning less than a
majority of the Common Stock. Nothing herein shall preclude the Bank from
issuing additional authorized but unissued shares of Common Stock to the Company
to allow for the exercise of options that would otherwise have resulted in the
Company owning less than a majority of the Common Stock.
10-8
16. Treatment of Options in the Event of a Conversion Transaction
In the event that the Company converts to stock form in a Conversion
Transaction, any Options outstanding shall, at the option of the holder, (i) be
convertible into Options for common stock of the Stock Holding Company, or (ii)
if vested, be exercised by the holder prior to the effective date of the
Conversion Transaction and the holder shall be entitled to exchange, in the same
manner as other minority stockholders of the Bank, the shares of Common Stock
received upon such exercise for shares of common stock of the Stock Holding
Company. If for any reason such options are not to be converted or such shares
are not exchanged, the holders of Options under the Plan shall receive cash
payment for the shares of Common Stock represented by the Options in an amount
equal to the Fair Market Value of the underlying Options or the initial offering
price of the common stock of the Stock Holding Company for which the Common
Stock underlying the Option would otherwise be exchanged, less the original
exercise price of such Options and, with respect to Options that have been
exercised, the Stock Holding Company shall redeem such shares for cash in the
same manner as such redemption would occur for other minority stockholders of
the Bank. Any exchange, conversion of Options, or cash payment for shares shall
be subject to applicable federal and state regulations and, if necessary,
subject to the approval of the appropriate regulatory authorities.
17. Withholding
There may be deducted from each distribution of cash and/or Common Stock
under the Plan the amount of tax required by any governmental authority to be
withheld.
18. Amendment of the Plan
The Board of Directors may at any time, and from time to time, modify or
amend the Plan in any respect; provided, however, that if necessary to continue
to qualify the Plan under the Securities and Exchange Commission Rule 16b-3, the
approval by a majority of the shares of Common Stock represented in person or by
proxy at an annual or special meeting of the Bank shall be required for any such
modification or amendment that:
(a) increases the maximum number of shares for which Options may be
granted under the Plan (subject, however, to the provisions of Section
14);
(b) reduces the exercise price at which Awards may be granted (subject,
however, to the provisions of Sections 7, 8, and 14;
(c) extends the period during which Options may be granted or exercised
beyond the times originally prescribed (subject, however, to the
provisions of Sections 7 and 8; or
(d) changes the persons eligible to participate in the Plan.
Failure to ratify or approve amendments or modifications to subsections (a)
through (d) of this Section 18 by shareholders shall be effective only as to the
specific amendment or modification requiring such ratification. Other
provisions, sections, and subsections of the Plan will remain in full force and
effect.
No such termination, modification or amendment may affect the rights of a
Participant under an outstanding Award.
19. Approval by Stockholders
The Plan shall be approved by stockholders of the Bank. No Options shall be
granted pursuant to the Plan prior to such stockholder approval.
20. Effective Date of Plan
The Plan shall become effective upon the date adopted by the Board of
Directors, following the approval of stockholders.
10-9
21. Termination of the Plan
The right to grant Awards under the Plan will terminate upon the earlier of
ten (10) years after the Effective Date or the date on which the exercise of
Options or related rights equaling the maximum number of shares reserved under
the Plan occurs as set forth in Section 5. The Board of Directors has the right
to suspend or terminate the Plan at any time; provided that no such action will,
without the consent of a Participant, affect adversely his rights under a
previously granted Award.
[Remainder of Page Left Intentionally Blank]
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22. Applicable Law
The Plan will be administered in accordance with federal law and the laws
of the State of Iowa.
Adopted April 17, 1996
ATTEST: WEBSTER CITY FEDERAL SAVINGS BANK
___________________________ By: _____________________________________
Corporate Secretary President and Chief Executive Officer
WCF FINANCIAL, M.H.C.
___________________________ By: ____________________________________
Corporate Secretary President and Chief Executive Officer
April 17, 1996
Date Approved by Stockholders
10-11
EXHIBIT 23.2
CONSENT OF KPMG
Independent Auditors' Consent
The Board of Directors
Webster City Federal Bancorp
We consent to incorporation by reference in the Registration Statement on Form
S-8 of Webster City Federal Bancorp of our report dated January 21, 2000,
relating to the consolidated balance sheets of Webster City Federal Bancorp and
subsidiaries as of December 31, 1999 and 1998, and the related consolidated
statements of operations, stockholders' equity and cash flows for each of the
years in the three-year period ended December 31, 1999, which report appears in
the December 31, 1999 annual report on Form 10-KSB of Webster City Federal
Bancorp.
/s/KPMG, LLP
Des Moines, Iowa
October 16, 2000