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): April 13, 2005
James Monroe Bancorp, Inc.
(Exact name of registrant as specified in its charter)
Virginia 000-32641 54-1941875
(State or other jurisdiction of incorporation) Commission File Number (I.R.S. Employer
Identification No.)
3033 Wilson Boulevard, Arlington, Virginia 22201
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 703.524.8100
Check the appropriate box below if the Form 8-K 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 MATERIAL DEFINITIVE AGREEMENT.
Effective April 13, 2005, the Board of Directors of James Monroe
Bancorp, Inc. (the "Company") approved the acceleration of the vesting of all
"underwater" unvested stock options including options held by executive
officers. A stock option was considered "underwater" if the option exercise
price was greater than $18.05 per share, the opening market price as of the date
of the board action. In addition, the Board of Directors of the Company approved
the granting and immediate vesting of 11,250 shares of the Company's stock to
Richard I. Linhart, Executive Vice President and Chief Operating Officer of the
Company. Under his employment agreement with the Company these shares were
originally scheduled to be granted in the fourth quarter of 2005. As a result of
these actions, the vesting of options to purchase 66,500 shares of the Company's
common stock was accelerated. Under recently issued accounting pronouncements
(SFAS 123R) the Company will be required to recognize compensation expense
related to stock options as they vest, which will reduce net income. The
decision to acceleration of the vesting of options to purchase 66,500 shares of
the Company's common stock was undertaken to eliminate the future compensation
expense that the Company would otherwise recognize in its income statement with
respect to those options upon the adoption of SFAS 123R scheduled for July 2005.
The acceleration of these options will result in the Company not being required
to recognize share-based after tax compensation of approximately $493,389
beginning in the quarter ending September 30, 2005 and ending in the Company's
quarter ending March 30, 2009. This amount will instead be reflected in a
proforma disclosure to the Company's financial statements for the quarter ending
June 30, 2005, as permitted under the transition guidance provided by the
Financial Accounting Standards Board. The Board believes that its action to
reduce the impact that SFAS 123R will have on earnings over the remaining
vesting period of the stock options is in the best interest of the Company's
shareholders. The other terms of each of the option grants will remain
unchanged.
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.
JAMES MONROE BANCORP, INC.
By: /s/ Richard I. Linhart
--------------------------------------------
Richard I. Linhart, Executive Vice President
and Chief Operating Officer
Dated: April 19, 2005