UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 29, 2005
FIDELITY BANKSHARES, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 000-29040 65-0717085
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(State or Other Jurisdiction) (Commission File No.) (I.R.S. Employer
of Incorporation) Identification No.)
205 Datura Street, West Palm Beach, Florida 33401
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (561) 803-9900
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Not Applicable
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Definitive Material Agreement.
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On December 29, 2005, the Benefits Committee of the Board of Directors of
Fidelity Bankshares, Inc. (the "Company") amended the Company's 2002 Incentive
Stock Benefit Plan (the "Plan") to eliminate "Limited Rights" from the Plan and
any other feature that grants an option holder the right to receive a cash
settlement of an option in circumstances that are not within the sole discretion
of the Company, and to require that any Company shares tendered as payment for
the exercise of a stock option have been held at least six months at the time of
tender to the Company. The Board determined to adopt these amendments in
response to a recent interpretation of FAS 123(R) that would require
reclassification as a "liability" and subsequent mark-to-market accounting, for
any option or other award the settlement of which, in cash, is not in the sole
discretion of the issuer of the option. Pursuant to Instruction 2 of Item
601(b)(10) of Regulation S-K, the amendments to the Plan will be filed as
exhibits to the Company's Annual Report on Form 10-K.
Additionally, on December 29, 2005, the Benefits Committee of the Board of
Directors of the Company approved the accelerated vesting and exercisability of
all unvested and unexercisable stock options granted as a part of the Plan held
by directors, officers or employees on December 30, 2005. As a result, options
to purchase 436,640 shares of common stock, which would otherwise have vested
and become exercisable from time to time over the next seventeen months, became
fully vested and immediately exercisable on December 30, 2005. The number of
shares and exercise prices of the options subject to acceleration are unchanged.
The accelerated options have exercise prices that range from $13.51 to $27.67
per share. The accelerated options include 267,000 options held by directors and
executive officers and 160,640 options held by other employees.
The Company estimates that accelerating the vesting and exercisability of
these options will reduce the impact of the adoption of Statement of Financial
Accounting Standards No. 123R "Share Based Payments" on 2006 compensation
expense related to outstanding options from approximately $953,000 to virtually
no expense.
Item 9.01 Financial Statements and Exhibits
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(a) Financial Statements of businesses acquired. Not
Applicable.
(b) Pro forma financial information. Not Applicable.
(c) Exhibits. Not Applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
FIDELITY BANKSHARES, INC.
DATE: January 4, 2006 By: /s/ Vince A. Elhilow
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Vince A. Elhilow
Chairman of the Board, President and
Chief Executive Officer