UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
CORNERSTONE BANCORP
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(Exact name of registrant as specified in its charter)
South Carolina 57-1077978
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(State of incorporation or organization) (IRS Employer Identification Number)
1670 East Main Street, Easley, South Carolina 29640
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(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
N/A
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If this form relates to the registration of a class of securities pursuant to
Section 12(b) of the Exchange Act and is effective pursuant to General
Instruction A.(c), check the following box. [ ]
If this form relates to the registration of a class of securities pursuant to
Section 12(g) of the Exchange Act and is effective pursuant to General
Instruction A.(d), check the following box. [X]
Securities Act registration statement file number to which this form relates:
(if applicable) N/A
Securities to be registered pursuant to Section 12(g) of the Act.
Common Stock (no par value)
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(Title of class)
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 1. Description of Registrant's Securities to be Registered.
The following summarizes certain provisions of the Articles of
Incorporation of Cornerstone Bancorp and state law, but is not complete and is
qualified in its entirety by reference to the Articles of Incorporation and by
the applicable statutory provisions.
Cornerstone Bancorp is a South Carolina corporation. As such, South
Carolina law controls the rights of shareholders and other matters relating to
the stock of Cornerstone Bancorp.
Capitalization. We are authorized to issue 20,000,000 shares of common
stock (no par value). We may also issue options or warrants to purchase some of
these authorized shares of common stock, including the options to be issued to
our directors and organizers. Our common stock has unlimited voting rights and
is entitled to receive our net assets upon dissolution. We are also authorized
to issue up to 10,000,000 shares of preferred stock in one or more series having
the preferences, limitations and relative rights determined by the Board of
Directors.
Quorum. A majority of our shares entitled to vote constitutes a quorum
at any meeting of shareholders.
Voting Rights; No Cumulative Voting. In general, each holder of our
common stock is entitled to one vote per share and to the same and identical
voting rights as other holders of our common stock. In the election of
directors, each shareholder has the right to vote the number of shares owned by
him on the record date for as many persons as there are directors to be elected.
Cumulative voting is not permitted. Absence of cumulative voting makes it more
difficult to effect a change in our board of directors.
Mergers, Consolidations, Exchanges, Sales of Assets or Dissolution. Our
Articles of Incorporation provide that, with respect to any plan of merger,
consolidation or exchange or any plan for the sale of all, or substantially all,
of our property and assets, with or without the good will, or any resolution to
dissolve us, which plan or resolution shall not have been adopted by the
affirmative vote of at least two-thirds of our full board of directors, such
plan or resolution must be approved by the affirmative vote of holders of 80% of
our outstanding shares. If at least two-thirds of the full board of directors
approves any such plan or resolution, the plan or resolution need only be
approved by the affirmative vote of holders of two-thirds of our outstanding
shares. Consequently, unless two-thirds of our directors favor such a plan or
resolution, it may be very difficult to effect any such transaction.
Classified Board of Directors. Our Articles of Incorporation provide
that our board of directors shall have the power to set the number of directors
from time to time at six or more directors. Our Articles provide further that
the board of directors shall be divided into three classes, each class to be as
nearly equal in number as possible. (This type of board is sometimes referred to
as a "classified board.") At each annual shareholders' meeting, directors are
chosen for a term of three years to succeed those directors whose terms expire.
Existence of a classified board makes it more difficult to effect a change in
control because it would normally require at least two elections to gain a
majority representation on the board, and three elections to change the entire
board.
Nomination of Directors. Our Articles of Incorporation provide that no
person shall be eligible to be elected as one of our directors at a meeting of
shareholders unless that person has been nominated by a shareholder entitled to
vote at such meeting by giving written notice of such nomination to our
corporate secretary at least 90 days prior to the date of the meeting. The
notice is required to include any information required by our Bylaws.
Removal of Directors. Our Articles of Incorporation provide that an
affirmative vote of 80% of our outstanding shares shall be required to remove
any or all of the directors without cause.
Duty of Directors. Our Articles of Incorporation provide that, when
evaluating any proposed plan of merger, consolidation, exchange or sale of all,
or substantially all, of our assets, our board of directors shall consider the
interests of our employees and the community or communities in which we and our
subsidiaries, if any, do business in addition to the interests of our
shareholders. Absent this provision, under existing common law, directors would
be required to give paramount consideration with respect to such matters to the
best interests of shareholders.
Limitation of Director Liability. Our Articles of Incorporation provide
that, to the extent permitted by the South Carolina Business Corporation Act,
our directors will not be personally liable to us or our shareholders for
monetary damages for breaches of their fiduciary duties. This provision does
not, however, eliminate or limit the liability of any director (i) for any
breach of the director's duty of loyalty to us or our shareholders, (ii) for
acts or omissions not in good faith or which involve gross negligence,
intentional misconduct or a knowing violation of law, (iii) imposed for unlawful
distributions as set forth in the South Carolina Business Corporation Act, or
(iv) for any transaction from which the director derived an improper personal
benefit.
No Preemptive Rights. Our shareholders do not have preemptive rights
with respect to the issuance of additional shares, options or rights of any
class of our stock. As a result, our directors may sell additional authorized
shares of our common stock without first offering them to existing shareholders
and giving them the opportunity to purchase sufficient additional shares to
prevent dilution of their ownership interests.
Amendment to Articles of Incorporation. Unless such amendment shall
have been approved by the affirmative vote of at least two-thirds of our full
board of directors, no amendment to our Articles of Incorporation which amends,
alters, repeals or is inconsistent with any of provisions of the Articles
described in this paragraph or in the nine paragraphs above, or in the
provisions relating to business combinations set forth under "Statutory Matters"
below, shall be effective unless it is approved by the affirmative vote of 80%
of our outstanding shares. If two-thirds of the full board of directors approves
such an amendment, the amendment need only be approved by holders of two-thirds
of our outstanding shares. Amendments to change the number and classes of shares
we are authorized to issue and to change our name only require the approval of a
majority of the outstanding shares. Other amendments requiring shareholder
approval must be approved by two-thirds of the outstanding shares.
Dividends. Our common stock is entitled, pro rata, to dividends paid by
us when, if and as declared by our board of directors from funds legally
available, whether in cash or in stock, but common stockholders have no specific
right to dividends. The determination and declaration of dividends is within the
discretion of our board of directors and will take into account our financial
condition, results of operations and other relevant factors. No assurances can
be given that any future dividends will be declared or, if declared, what the
amount of such dividends will be or whether such dividends will continue for
future periods. We may not declare or pay a cash dividend on any of our stock if
we are insolvent or if the payment of the dividend would render us insolvent. If
we issue preferred stock, the terms of the preferred stock may require us to pay
dividends to holders of preferred stock under some circumstances. The payment of
dividends to holders of preferred stock will not entitle our common stockholders
to the payment of dividends.
Conversion; Redemption; Sinking Fund. None of our common stock is
convertible, has any redemption rights or is entitled to any sinking fund.
Statutory Matters.
Business Combination Statute. The South Carolina business combinations
statute provides that a 10% or greater shareholder of a resident domestic
corporation cannot engage in a "business combination" (as defined in the
statute) with such corporation for a period of two years following the date on
which the 10% shareholder became such, unless the business combination or the
acquisition of shares is approved by a majority of the disinterested members of
such corporation's board of directors before the 10% shareholder's share
acquisition date. This statute further provides that at no time (even after the
two-year period subsequent to such share acquisition date) may the 10%
shareholder engage in a business combination with the relevant corporation
unless certain approvals of the board of directors or disinterested shareholders
are obtained or unless the consideration given in the combination meets certain
minimum standards set forth in the statute. The law is very broad in its scope
and is designed to inhibit unfriendly acquisitions but it does not apply to
corporations whose articles of incorporation contain a provision electing not to
be covered by the law. Our Articles of Incorporation do not contain such a
provision. An amendment of our Articles of Incorporation to that effect would,
however, permit a business combination with an interested shareholder although
that status was obtained prior to the amendment. Unless we have a class of
securities registered under Section 12 of the Securities Exchange Act of 1934,
this statute would not ordinarily apply to us. However, we have specifically
elected in our Articles of Incorporation to make the provisions of the statute
applicable to us.
Control Share Acquisitions. The South Carolina corporations law also
contains provisions that, under certain circumstances, would preclude an
acquiror of the shares of a South Carolina corporation who crosses one of three
voting thresholds (20%, 33-1/3% or 50%) from obtaining voting control with
respect to such shares unless a majority in interest of the disinterested
shareholders of the corporation votes to accord voting power to such shares.
The legislation provides that, if authorized by the articles of
incorporation or bylaws prior to the occurrence of a control share acquisition,
the corporation may redeem the control shares if the acquiring person has not
complied with certain procedural requirements (including the filing of an
"acquiring person statement" with the corporation within 60 days after the
control share acquisition) or if the control shares are not accorded full voting
rights by the shareholders. We are not authorized by our Articles of
Incorporation or bylaws to redeem control shares.
Indemnification of Directors and Officers. Under South Carolina law, a
corporation has the power to indemnify directors and officers who meet the
standards of good faith and reasonable belief that their conduct was lawful and
in the corporate interest (or not opposed thereto) set forth by statute. A
corporation may also provide insurance for directors and officers against
liability arising out of their positions although the insurance coverage is
broader than the power of the corporation to indemnify. Unless limited by its
articles of incorporation, a corporation must indemnify a director or officer
who is wholly successful, on the merits or otherwise, in the defense of any
proceeding to which he was a party because he is or was a director against
reasonable expenses incurred by him in connection with the proceeding. Our
Articles of Incorporation do not limit such indemnification.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Act") may be permitted to our directors, officers and
controlling persons pursuant to the foregoing provisions, or otherwise, we have
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.
General
Taken together, the foregoing provisions of our Articles of
Incorporation and South Carolina law favor maintenance of the status quo and may
make it more difficult to change current management, and may impede a change of
control of Cornerstone Bancorp even if desired by a majority of our
shareholders.
Item 2. Exhibits.
1. Articles of Incorporation of Cornerstone Bancorp (incorporated by
reference to Registration Statement on Form SB-2 (No. 333-79543))
2. Bylaws of Cornerstone Bancorp (incorporated by reference to
Registration Statement on Form SB-2 (No. 333-79543))
3. Cornerstone Bancorp 2003 Stock Option Plan
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.
Cornerstone Bancorp
April 21, 2006 By: s/J. Rodger Anthony
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J. Rodger Anthony
President and Chief Executive Officer
EXHIBIT INDEX
1. Articles of Incorporation of Cornerstone Bancorp (incorporated by reference
to Registration Statement on Form SB-2 (No. 333-79543))
2. Bylaws of Cornerstone Bancorp (incorporated by reference to Registration
Statement on Form SB-2 (No. 333-79543))
3. Cornerstone Bancorp 2003 Stock Option Plan