As filed with the Securities and Exchange Commission on April 5, 2002
Registration No. [_________]
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------------
MOUNTAINBANK FINANCIAL CORPORATION
(Exact name of Registrant as specified in its charter)
North Carolina 56-2237240
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
201 Wren Drive
Hendersonville, North Carolina 28792
(Address of principal executive offices, including zip code)
(828) 693-7376
Registrant's telephone number, including area code
-------------------------
First Western Bank Nonstatutory Stock Options
(Full title of the Plan)
-------------------------
Gregory L. Gibson Copy to:
MountainBank Financial Corporation William R. Lathan, Jr., Esq.
201 Wren Drive Ward and Smith, P.A.
Hendersonville, North Carolina 28792 1001 College Court
(828) 697-0030 New Bern, North Carolina 28562
(Name and address of agent for service) (252) 672-5458
-------------------------
CALCULATION OF REGISTRATION FEE
===================================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Registration
to be Registered Registered Per Share (1) Offering Price (1) Fee (1)
- ---------------------------------------------------------------------------------------------------
Common Stock,
$4.00 par value 68,750 $ 20.44 $ 1,405,250 $ 129.28
===================================================================================================
(1) The shares of Common Stock are being offered to former directors of First
Western Bank ("First Western") pursuant to the terms of options granted by
First Western under its 1998 and 1999 Nonstatutory Stock Option Plans (the
"Plans") which were assumed by Registrant in connection with its
acquisition of First Western. Pursuant to Rule 457(h), the Aggregate
Offering Price and Registration Fee have been calculated on the basis of
the maximum number of shares to be issued under the Plans and the weighted
average exercise price of the options under the Plans.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference
The following documents we have filed with the Securities and Exchange
Commission (the "Commission") under the Securities Exchange Act of 1934 (the
"Exchange Act") are incorporated herein by reference:
(i) our Annual Report on Form 10-KSB for the year ended December 31,
2001; and
(ii) our Current Report on Form 8-K dated December 31, 2001, as amended by
Form 8-K/A dated March 12, 2002.
All documents we subsequently file with the Commission pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold, or which registers all securities then remaining unsold, will be deemed to
be incorporated into this Registration Statement by reference and to be a part
hereof from the dates of filing of those documents.
Item 4. Description of Securities
Authorized Capital Stock. Our authorized capital stock currently consists
of 10,000,000 shares of $4.00 par value common stock, of which 3,112,699 shares
were issued and outstanding on March 31, 2002, and 3,000,000 shares of no par
value preferred stock, of which 359,758 shares were issued and outstanding on
March 31, 2002.
Our Board of Directors is authorized to issue shares of our preferred stock
from time to time, to create separate series of preferred stock within that
class, and to determine the numbers of shares, designations, terms, relative
rights, preferences and limitations of the preferred stock, or of shares within
each series of preferred stock, at the time of issuance, all by its resolution
and without any further shareholder approval. Pursuant to that authority, our
Board of Directors has established a series of preferred stock ("Series A
Preferred Stock") consisting of 450,000 shares having the terms, relative
rights, preferences and limitations further described below. On March 31, 2002,
all our outstanding shares of preferred stock were Series A Preferred Stock.
In addition to Series A Preferred Stock, in the future our Board of
Directors may create additional series of preferred stock and issue shares of
those series from time to time. The numbers of shares, designations, terms,
relative rights, preferences and limitations of shares within each such
additional series of preferred stock would be determined by our Board of
Directors at the time of issuance by its resolution and without any shareholder
approval. Any shares of preferred stock we issue in the future likely would have
certain preferences over, or special terms that differed from, the outstanding
shares of our common stock or Series A Preferred Stock. Among other things,
those preferences and special terms might include:
. the right to receive dividends (which may be cumulative or noncumulative)
at a stated rate before any dividend could be paid on our common stock or
other capital stock;
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. the right to receive a stated distribution upon our liquidation before any
distribution could be made to holders of our common stock or other capital
stock;
. if they are voting shares, special voting rights, including rights to vote
as a separate group or class in matters submitted for a vote of our
shareholders;
. terms providing for the conversion of shares of preferred stock into shares
of our common stock, either automatically or at our option or the option of
the holders of the preferred stock, at specified rates; and
. terms providing for the redemption of shares of the preferred stock, either
at our option or the option of the holders of those shares or both, or upon
the happening of a specified event, and, if they are redeemable, the
redemption prices, conditions and times upon which redemption may take
place.
The issuance of any other shares of preferred stock in the future would
dilute the relative percentage equity interests of the then current holders of
our common stock and other shares of capital stock. Holders of our capital stock
(common or preferred) will not have preemptive rights to acquire a proportionate
share, or any portion, of any additional shares of capital stock we issue in the
future, including any additional shares of preferred stock we issue.
Nature of Capital Stock. Shares of our common stock and preferred stock
represent equity interests in us and are not deposits or savings accounts and
are not obligations of or guaranteed by us or our banking subsidiary. They are
not insured by the FDIC or any other government agency and are subject to
investment risk, including the possible loss of principal.
Voting Rights. Holders of our common stock are entitled to one vote per
share held of record on all matters submitted to a vote of shareholders.
Our Series A Preferred Stock is nonvoting stock. Except in the case of
certain matters as to which the North Carolina statutes provide for mandatory
voting by all outstanding shares (whether or not they otherwise are voting
shares), the holders of Series A Preferred Stock will not be entitled to any
vote on matters submitted to a vote of our shareholders, including the election
of our directors.
The North Carolina Control Share Acquisition Act, in general, provides that
shares of voting stock of a corporation (to which that Act applies) acquired in
a "control share acquisition" ("Control Shares") will have no voting rights
unless those rights are granted by resolution adopted by the holders of at least
a majority of the outstanding shares of the corporation entitled to vote in the
election of directors, excluding shares held by the person who has acquired or
proposes to acquire the Control Shares and excluding shares held by any officer
or director who is also an employee of the corporation. "Control Shares" are
defined as shares of a corporation acquired by any person which, when added to
the shares already owned by that person, would entitle the person (except for
the application of the Act) to voting power in the election of directors equal
to or greater than (i) one-fifth of all voting power, (ii) one-third of all
voting power, or (iii) a majority of all voting power. "Control share
acquisition" means the acquisition by any person of beneficial ownership of
Control Shares with certain exceptions, including an acquisition pursuant to
certain agreements of merger or consolidation to which the corporation is a
party, and purchases of shares directly from the corporation.
Dividends. Holders of our common stock are entitled to cash dividends if
and when declared by our Board of Directors from funds legally available,
whether in cash or in stock.
Each share of Series A Preferred Stock provides for stated, non-cumulative
cash dividends from us at an annual rate of $1.44. Dividends will be payable as
they are declared by our Board of Directors at
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such time or times as it elects, and the stated annual dividend may be declared
and paid in increments (including quarterly) during each calendar year.
Holders of Series A Preferred Stock do not have a right to receive any cash
dividend on their preferred stock unless and until the dividend is declared by
our Board of Directors from funds legally available for the payment of
dividends. So, we will not be obligated to pay any cash dividend on our Series A
Preferred Stock during any year. Further, since the Series A Preferred Stock
will be non-cumulative on a year-to-year basis as to dividends, if we do not pay
all or part of the stated cash dividend in a calendar year, that dividend will
not carry forward to any future calendar year. However, during any calendar
year, we may not pay any cash dividend on our common stock unless and until we
have declared and paid in full, or set apart for payment, not less than a pro
rata portion of the stated annual dividend on our Series A Preferred Stock for
that year through the date on which we wish to pay the cash dividend on the
common stock. Shares of Series A Preferred Stock are non-participating, so
holders of our Series A Preferred Stock will not participate in cash dividends
paid with respect to any other class or series of our capital stock, and the
stated dividend is the maximum cash dividend that we will pay for any year on
our Series A Preferred Stock.
Conversion. Our common stock is not convertible into any other type of our
capital stock or other securities.
Subject to certain notice requirements, each holder of Series A Preferred
Stock, at the holder's option, and at any time after that stock is issued, may
convert each share of that stock he holds into one share of our common stock.
After two years following the date it is issued, and subject to certain
notice requirements, we may convert part or all of our outstanding shares of
Series A Preferred Stock into shares of our common stock, at a rate of one share
of common stock for each share of preferred stock, at any time when the market
value of a share of our common stock is more than $28.80. If we elect to convert
less than all outstanding shares of Series A Preferred Stock into common stock,
we may choose the shares to be converted randomly, proportionately, or in any
other manner that we consider to be appropriate.
For purposes of determining when we may convert Series A Preferred Stock,
the market value of a share of our common stock will be deemed to be the average
of the reported closing prices for the common stock for the 30 trading days
preceding the date on which we give you the required notice of conversion.
If we (i) declare any dividend payable by us in shares of our common stock,
(ii) engage in any recapitalization, reclassification, split, reverse split,
consolidation or combination of the outstanding shares of our common stock, or
(iii) engage in an exchange of the outstanding shares of our common stock for a
different number or class of shares of our stock or other securities in
connection with a merger, statutory share exchange or other reorganization of or
involving us and in which we are the surviving or resulting corporation, then
the number and/or type of shares of our common stock or other securities into
which each outstanding share of Series A Preferred Stock may be converted will
be proportionately adjusted, effective on the date of any such event, to prevent
the dilution of conversion rights pertaining to the preferred stock.
If, as a result of an adjustment described above in the number of shares of
our common stock into which each share of Series A Preferred Stock is
convertible, a conversion would result in a fractional share of our common
stock, then, upon conversion of a holder's shares, we will issue to the holder
the number of whole shares of common stock into which each of that holder's
shares is convertible and, in lieu of issuing the fractional share, we will pay
the holder in cash an amount equal to that fraction multiplied by the then
current market value of a share of our common stock. The market value of a share
of our common stock will be determined by our Board of Directors in a manner
which it considers to be reasonable and appropriate.
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Liquidation. If we are liquidated or dissolved, or our business is wound
up, whether voluntarily or involuntarily, holders of our common stock would
entitled to participate ratably in the distribution of assets legally available
for distribution to holders of common stock after any distribution to holders of
our outstanding preferred stock.
In connection with any such liquidation or dissolution, the holders of our
Series A Preferred Stock will be entitled to receive, for each preferred share
they hold (without preference or priority as between shares of the Series A
Preferred Stock or other series of preferred stock), from our assets available
for distribution to our shareholders a sum equal to $24.00 plus the amount of
any dividend that has been declared on the shares but which has not yet been
paid. Holders of Series A Preferred Stock would receive that amount before we
could make any distribution of assets to the holders of our common stock. That
distribution would be full payment to holders of Series A Preferred Stock, and
they would not participate with the holders of any other class or series of our
capital stock in the distribution of any of our additional assets.
Election of Directors. Our Bylaws provide that our Board of Directors is
divided into three classes and our directors are elected to staggered three-year
terms. The terms of directors in one class expire each year, and directors in
that class are elected for new three-year terms. The effect of staggered terms
is that only approximately one-third of our directors are elected each year.
Since it would take longer for someone who is attempting to acquire control of
us to replace our directors through the normal election process, under some
circumstances staggered terms may be used as, or have the effect of, an
"anti-takeover" device or a deterrent to an acquisition or change in control of
us, whether or not such a transaction was favored by our shareholders.
Charter Amendments. Subject to certain conditions, an amendment to our
charter, including an amendment to increase or change our authorized capital
stock, may be effected if the amendment is recommended to our shareholders by
the Board of Directors and if the votes in favor of the amendment cast by
shareholders who are eligible to vote exceed the votes cast opposing the
amendment.
Merger, Share Exchange, Sale of Assets and Dissolution. In general, North
Carolina law requires that any merger, share exchange, voluntary liquidation or
transfer of substantially all the assets (other than in the ordinary course of
business) of a business corporation be recommended to its shareholders by its
board of directors and be approved by the affirmative vote of the holders of at
least a majority of the outstanding shares of its voting stock. However, under
the North Carolina Shareholder Protection Act, the affirmative vote of the
holders of 95% of our outstanding voting shares (voting as a single class, but
excluding shares owned by an "interested shareholder") is required to approve
certain business combinations between us and an entity which owns more than 10%
of our voting shares.
Miscellaneous. Holders of our common stock and preferred stock do not have
preemptive rights to acquire other or additional shares which might be issued by
us in the future or any redemption or sinking fund rights.
Item 5. Interests of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
Permissible Indemnification. The North Carolina Business Corporation Act
(the "BCAct") allows a corporation, by charter, bylaw, contract, or resolution,
to indemnify or agree to indemnify its officers, directors, employees, and
agents and any person who is or was serving at the corporation's request as a
director, officer, employee, or agent of another entity or enterprise or as a
trustee or administrator under an employee benefit plan, against liability and
expenses, including reasonable attorneys' fees, in any proceeding (including
without limitation a proceeding brought by or on behalf of
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the corporation itself) arising out of their status as such or their activities
in any of the foregoing capacities as summarized herein. Any provision in a
corporation's charter or bylaws or in a contract or resolution may include
provisions for recovery from the corporation of reasonable costs, expenses and
attorneys' fees in connection with the enforcement of rights to indemnification
granted therein and may further include provisions establishing reasonable
procedures for determining and enforcing such rights.
The corporation may indemnify such person against liability expenses
incurred only where such person conducted himself or herself in good faith and
reasonably believed (i) in the case of conduct in his or her official corporate
capacity, that his or her conduct was in the corporation's best interests, and
(ii) in all other cases, that his or her conduct was at least not opposed to the
corporation's best interests; and, in the case of a criminal proceeding, he or
she had no reasonable cause to believe his or her conduct was unlawful. However,
a corporation may not indemnify such person either in connection with a
proceeding by or in the right of the corporation in which such person was
adjudged liable to the corporation, or in connection with any other proceeding
charging improper personal benefit to such person (whether or not involving
action in an official capacity) in which such person was adjudged liable on the
basis that personal benefit was improperly received.
Mandatory Indemnification. Unless limited by the corporation's charter, the
BCAct requires a corporation to indemnify a director or officer of the
corporation who is wholly successful, on the merits or otherwise, in the defense
of any proceeding to which such person was a party because he or she is or was a
director or officer of the corporation against reasonable expenses incurred in
connection with the proceeding.
Advance for Expenses. Expenses incurred by a director, officer, employee,
or agent of the corporation in defending a proceeding may be paid by the
corporation in advance of the final disposition of the proceeding as authorized
by the board of directors in the specific case, or as authorized by the charter
or bylaws or by any applicable resolution or contract, upon receipt of an
undertaking by or on behalf of such person to repay amounts advanced, unless it
ultimately is determined that such person is entitled to be indemnified by the
corporation against such expenses.
Court-Ordered Indemnification. Unless otherwise provided in the
corporation's charter, a director or officer of the corporation who is a party
to a proceeding may apply for indemnification to the court conducting the
proceeding or to another court of competent jurisdiction. On receipt of an
application, the court, after giving any notice the court deems necessary, may
order indemnification if it determines either (i) that the director or officer
is entitled to mandatory indemnification as described above, in which case the
court also will order the corporation to pay the reasonable expenses incurred to
obtain the court-ordered indemnification, or (ii) that the director or officer
is fairly and reasonably entitled to indemnification in view of all the relevant
circumstances, whether or not such person met the requisite standard of conduct
or was adjudged liable to the corporation in connection with a proceeding by or
in the right of the corporation or on the basis that personal benefit was
improperly received in connection with any other proceeding so charging (but if
adjudged so liable, indemnification is limited to reasonable expenses incurred).
Parties Entitled to Indemnification. The BCAct defines "director" to
include former directors and the estate or personal representative of a
director. Unless its charter provides otherwise, a corporation may indemnify and
advance expenses to an officer, employee or agent of the corporation to the same
extent as to a director and also may indemnify and advance expenses to an
officer, employee or agent who is not a director to the extent, consistent with
public policy, as may be provided in its charter or bylaws, by general or
specific action of its board of directors, or by contract.
Indemnification by Us. Our Bylaws provide for indemnification of our
directors and officers to the fullest extent permitted by North Carolina law and
require the Board of Directors to take all actions necessary and appropriate to
authorize such indemnification.
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Under North Carolina law, a corporation also may purchase insurance on
behalf of any person who is or was a director or officer against any liability
arising out of his status as such. We currently maintain a directors' and
officers' liability insurance policy and its coverage is applicable to all our
directors and officers.
Item 7. Exemption From Registration Claimed
Not applicable.
Item 8. Exhibits
The following exhibits are filed herewith or incorporated herein by
reference as part of this Registration Statement:
Exhibit Number Description
-------------- -------------------------------------------------------
5 Opinion of Ward and Smith, P.A.
23.1 Consent of Larrowe & Company, PLLC
23.2 Consent of Ward and Smith, P.A. (contained in its
opinion filed herewith as Exhibit 5).
24 Powers of Attorney
99.1 1998 Nonstatutory Stock Option Plan
99.2 1999 Nonstatutory Stock Option Plan
Item 9. Undertakings
MountainBank Financial Corporation hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or
most recent post-effective amendment thereto) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement; and,
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the 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
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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 offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of our annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 that is incorporated by reference in the Registration
Statement 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.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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. In the event that a claim for
indemnification against such liabilities (other than the payment
by us of expenses incurred or paid by one of our directors,
officers or controlling persons 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, we will, unless in the opinion of our counsel the
matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such
indemnification by us is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, 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 the City of Hendersonville, State of North Carolina, on April 5,
2002.
MOUNTAINBANK FINANCIAL CORPORATION
By: /s/ J. W. Davis
------------------------------------------
J. W. Davis
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ J. W. Davis President, Chief Executive Officer April 5, 2002
- ------------------------------------ Officer and Director
J. W. Davis (principal executive officer)
/s/ Gregory L. Gibson Executive Vice President and April 5, 2002
- ------------------------------------ Chief Financial Officer
Gregory L. Gibson (principal financial and
accounting officer)
* /s/ Boyd L. Hyder Chairman April 5, 2002
- ------------------------------------
Boyd L. Hyder
* /s/ William A. Banks Director April 5, 2002
- ------------------------------------
William A. Banks
* /s/ William H. Burton III Director April 5, 2002
- ------------------------------------
William H. Burton III
* /s/ Kenneth C. Feagin Director April 5, 2002
- ------------------------------------
Kenneth C. Feagin
* /s/ Danny L. Ford Director April 5, 2002
- ------------------------------------
Danny L. Ford
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* /s/ J. Edward Jones Director April 5, 2002
- ------------------------------------
J. Edward Jones
* /s/ Ronald R. Lamb Director April 5, 2002
- ------------------------------------
Ronald R. Lamb
* /s/ H. Steve McManus Director April 5, 2002
- ------------------------------------
H. Steve McManus
* /s/ Van F. Phillips Director April 5, 2002
- ------------------------------------
Van F. Phillips
* /s/ Catherine H. Schroader Director April 5, 2002
- ------------------------------------
Catherine H. Schroader
* /s/ Maurice A. Scott Director April 5, 2002
- ------------------------------------
Maurice A. Scott
* Gregory L. Gibson hereby signs this Registration Statement on Form S-8 on
April 5, 2002, on behalf of each of the indicated persons for whom he is
attorney-in-fact pursuant to Powers of Attorney filed herewith.
By: /s/ Gregory L. Gibson
---------------------------------------------
Gregory L. Gibson
As Attorney-In-Fact
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EXHIBIT INDEX
Exhibit
Number Description
------ -------------------------------------------------------
5 Opinion of Ward and Smith, P.A.
23.1 Consent of Larrowe & Company, PLLC
23.2 Consent of Ward and Smith, P.A. (contained in its
opinion filed herewith as Exhibit 5).
24 Powers of Attorney
99.1 1998 Nonstatutory Stock Option Plan
99.2 1999 Nonstatutory Stock Option Plan