Exhibit 4.7
VIRGINIA FIRST SAVINGS BANK, F.S.B.
1992 INCENTIVE PLAN
AS AMENDED SEPTEMBER 19, 1995
Article 1
DEFINITIONS
1.01 Affiliate means any "subsidiary" or "parent corporation"
(within the meaning of Section 424 of the Code) of the Company.
1.02 Agreement means a written agreement (including any amendment
or supplement thereto) between the Company and a Participant specifying the
terms and conditions of a Grant or an Award issued to such Participant.
1.03 Award means an award of Common Stock, Restricted Stock and/or
Phantom Stock.
1.04 Board means the Board of Directors of the Company.
1.05 Change of Control means and shall be deemed to have taken
place if: (i) a third person, including a "group" as defined in Section 13(d)(3)
of the Securities Exchange Act of 1934, who after the effective date of the Plan
becomes the beneficial owner of shares of the Company having 20 percent or more
of the total number of votes that may be cast for the election of Directors of
the Company; or, (ii) as the result of, or in connection with, any cash tender
or exchange offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing transactions (a
"Transaction"), the persons who were Directors of the Company before the
Transaction shall cease to constitute a majority of the Board of the Company or
any successor to the Company.
1.06 Change of Control Date is the date on which an event described
in (i) or (ii) of Section 1.05 occurs.
1.07 Code means the Internal Revenue Code of 1986, and any
amendments thereto.
1.08 Committee means the Executive Compensation Committee of the
Board.
1.09 Common Stock means the Common Stock of the Company.
1.10 Company means Virginia First savings Bank, F.S.B.
1.11 Fair Market Value means, on any given date, the average of the
bid and asked prices at closing of a share of Common Stock on the
over-the-counter market as reported in the Richmond Times Dispatch on such day
or, if the Common Stock was not traded on such day, then on the next preceding
day that the Common Stock was traded on such exchange, all as reported by such
source as the Committee may select.
1.12 Grant means the grant of an option and/or an SAR.
1.13 Incentive Stock Option means an Option that is intended to
qualify as an "incentive stock option" under Section 422 of the Code.
1.14 Initial Value means, with respect to an SAR, the Fair Market
Value of one share of Common Stock on the date of grant, as set forth in the
Agreement.
1.15 Non-Qualified Stock Option means an option other than an
Incentive Stock Option.
1.16 Option means a stock option that entitles the holder to
purchase from the Company a stated number of shares of Common Stock at the price
set forth in an Agreement.
1.17 Option Price means the price per share for Common Stock
purchased on the exercise of an option as provided in Article VI.
1.18 Participant means an employee of the Company or of a
Subsidiary, including an employee who is a member of the Board, who satisfies
the requirements of Article IV and is selected by the Committee to receive a
Grant or an Award.
1.19 Phantom Stock means a bookkeeping entry on behalf of a
Participant by which his account is credited (but not funded) as though Common
Stock had been transferred to such account.
1.20 Plan means the Virginia First Savings Bank, F.S.B. 1992
Incentive Plan.
1.21 Restricted Stock means shares of Common Stock awarded to a
Participant under Article IX. Shares of Common Stock shall cease to be
Restricted Stock when, in accordance with the terms of the applicable Agreement,
they become transferable and free of substantial risks of forfeiture.
1.22 Rule 16b-3 means Rule 16b-3, as promulgated by the Securities
and Exchange Commission under Section 16(b) of the Securities Exchange Act of
1934, as amended from time to time.
1.23 SAR means a stock appreciation right that entitles the holder
to receive, with respect to each share of Common Stock encompassed by the
exercise of such SAR, the lesser of (a) the excess of the Fair Market Value at
the time of exercise over the Initial Value of the SAR or (b) the Initial Value
of the SAR.
1.24 Securities Broker means the registered securities broker
acceptable to the Company who agrees to effect the cashless exercise of an
option pursuant to Section 8.05 hereof.
1.25 Subsidiary means any corporation (other than the Company)
in an unbroken chain of corporations beginning with the Company if each of the
corporations in the chain (other than the last corporation) owns stock
possessing at least 50 percent of the total combined voting power of all classes
of stock in one of the other corporations in such chain.
-2-
Article II
PURPOSES
The Plan is intended to assist the Company in recruiting and retaining
key employees with ability and initiative by enabling employees who contribute
significantly to the Company or an Affiliate to participate in its future
success and to associate their interests with those of the Company and its
shareholders. The Plan is intended to permit the award of Common Stock,
Restricted Stock, and Phantom Stock, and the issuance of options qualifying as
Incentive Stock Options or Non-Qualified Stock Options as designated by the
Committee at time of grant, and SARs. No Option that is intended to be an
Incentive Stock Option, however, shall be invalid for failure to qualify as an
Incentive Stock Option under Section 422 of the Code but shall be treated as a
Non-Qualified Stock Option.
Article III
ADMINISTRATION
The Plan shall be administered by the Committee. The Committee shall
have authority to issue Grants and Awards upon such terms (not inconsistent with
the provisions of this Plan) as the Committee may consider appropriate. The
terms of such Grants and Awards may include conditions (in addition to those
contained in this Plan) on (i) the exercisability of all or any part of an
Option or SAR and (ii) the transferability or forfeitability of Restricted Stock
or Phantom Stock. In addition, the Committee shall have complete authority to
interpret all provisions of this Plan; to prescribe the form of Agreements; to
adopt, amend, and rescind rules and regulations pertaining to the administration
of the Plan; and to make all other determinations necessary or advisable for the
administration of this Plan.
The express grant in the Plan of any specific power to the Committee
shall not be construed as limiting any power or authority of the Committee. Any
decision made, or action taken, by the Committee or in connection with the
administration of this Plan shall be final and conclusive. All expenses of
administering this Plan shall be borne by the Company.
Article IV
ELIGIBILITY
4.01 General. Any employee of the Company or of any Subsidiary
(including any corporation that becomes a Subsidiary after the adoption of this
Plan) who, in the judgment of the Committee, has contributed significantly or
can be expected to contribute significantly to the profits or growth of the
Company or a Subsidiary may receive one or more Awards or Grants, or any
combination or type thereof. Directors of the Company who are employees are
eligible to participate in this Plan. A person who is a member of the Committee
may not be issued Awards or Grants while he is a member of the Committee.
4.02 Grants and Awards. The Committee will designate individuals
to whom Grants and/or Awards are to be issued and will specify the number of
shares of Common Stock subject to each such Grant or Award. An Option may be
granted with or without a related SAR. An SAR may be granted with or without a
related Option. All Grants or Awards issued under this Plan
-3-
shall be evidenced by Agreements which shall be subject to applicable provisions
of this Plan and to such other provisions as the Committee may adopt. No
Participant may be granted Options that are Incentive Stock Options, or related
SARs (under all Incentive Stock Option Plans of the Company and Affiliates)
which are first exercisable in any calendar year for stock having an aggregate
Fair Market Value (determined as of the date an Option is granted) exceeding
$100,000.
4.03 Reload Options. The Committee shall have the authority to
specify at the time of Grant that an optionee shall be granted the right to a
further Non-Qualified Stock Option (a "Reload Option") in the event such
optionee exercises all or a part of an Option, including a Reload Option (an
"Original Option"), by surrendering in accordance with Section 8.02 hereof
already owned shares of Common Stock in full or partial payment of the Option
Price under such Original Option. Each Reload Option shall be granted on the
date of exercise of the Original Option, shall cover a number of shares of
Common Stock not exceeding the whole number of shares of Common Stock
surrendered in payment of the Option Price under such Original Option, shall
have an Option Price equal to the Fair Market Value on the date of Grant of such
Reload option, shall expire on the stated expiration date of the Original Option
and shall be subject to such other terms and conditions as the Committee may
determine.
4.04 Designation of Option as an Incentive Stock Option or a
Non-Qualified Stock Option. The Committee will designate at the time an Option
is granted whether the Option is to be treated as an Incentive Stock Option or a
Non-Qualified Stock Option. In the absence, however, of any such designation,
such option shall be treated as a Non-Qualified Stock Option.
Article V
STOCK SUBJECT TO PLAN
The maximum number of shares of Common Stock available for Grants and
Awards under the Plan shall be 337,500, of which 62,500 shall be available only
as Reload Options. Such maximum number of shares of Common Stock is subject to
adjustment as provided in Article XI. Shares of Common Stock subject to Grants
and Awards under the Plan may be authorized but previously unissued shares of
Common Stock or previously issued shares of Common Stock reacquired by the
Company. The grant of a Reload Option under the Plan, by restoring an option
opportunity on the number of shares of Common Stock surrendered to exercise an
Original option, will encourage a Participant to maximize his ownership interest
in the Company without reducing the percentage interests of shareholders.
If any shares of Restricted Stock are forfeited for which the
Participant did not receive any benefits of ownership (other than voting
rights), or if any option or any SAR terminates without being exercised, or if
any SAR is exercised for cash, shares of Common Stock subject to such Grants or
Awards shall be available for distribution in connection with Grants or Awards
under the Plan.
-4-
Article VI
OPTION PRICE
The price per share for Common Stock purchased on the exercise of an
option shall be fixed by the Committee on the date of grant; provided, however,
that in the case of an option that is an Incentive Stock option, the price per
share shall not be less than the Fair market Value on such date.
Article VII
EXERCISE OF OPTIONS
7.01 Maximum Option or SAR Period. The period in which an option or
SAR may be exercised shall be determined by the Committee on the date of grant;
provided, however that an Incentive Stock option or related SAR shall not be
exercisable after the expiration of 10 years from the date the Incentive Stock
option was granted.
7.02 Nontransferability. Any Option or SAR granted under this
plan shall be nontransferable except by will or by the laws of descent and
distribution. In the event of any such transfer, the Option and any related SAR
must be transferred to the same person or persons, trust or estate. During the
lifetime of the Participant to whom an Incentive Stock Option or related SAR is
granted, the Option or SAR may be exercised only by the Participant. No right or
interest of a Participant in any Option or SAR shall be liable for, or subject
to, any lien, obligation, or liability of such Participant.
7.03 Employee Status. For purposes of determining the
applicability of Section 422 of the Code (relating to incentive stock options),
or in the event that the terms of any Grant provide that it may be exercised
only during employment or within a specified period of time after termination of
employment, the Committee may decide to what extent leaves of absence for
governmental or military service, illness, temporary disability, or other
reasons shall not be deemed interruptions of continuous employment.
Article VIII
METHOD OF EXERCISE
8.01 Exercise. Subject to the provisions of Articles VII and XII,
an option or SAR may be exercised in whole at any time or in part from time to
time at such times and in compliance with such requirements as the Committee
shall determine; provided, however, that a SAR that is related to an option may
be exercised only to the extent that the related option is exercisable and when
the Fair Market Value exceeds the option Price of the related Option. An Option
or SAR granted under this Plan may be exercised with respect to any number of
whole shares less than the full number for which the Option or SAR could be
exercised. Such partial exercise of an Option or SAR shall not affect the right
to exercise the option or SAR from time to time in accordance with this Plan
with respect to remaining shares subject to the option or related SAR. The
exercise of an Option shall result in the termination of the SAR to the extent
of the number of shares with respect to which the Option is exercised.
-5-
8.02 Payment. Unless otherwise provided by the Agreement, payment
of the Option Price shall be made in cash. If the Agreement provides, payment of
all or part of the Option Price may be made by withholding shares of Common
Stock upon exercise of an Option or by surrendering already owned shares of
Common Stock to the Company, provided the shares withheld or surrendered have a
Fair Market Value (determined as of the day preceding the date of exercise) that
is not less than such price or part thereof. In addition, the Committee may
establish such payment or other terms as it may deem to be appropriate and
consistent with these purposes.
8.03 Determination of Payment of Cash and/or Common Stock Upon
Exercise of SAR. At the Committee's discretion, the amount payable as a result
of the exercise of an SAR may be settled in cash, Common Stock, or a combination
of cash and Common Stock. No fractional shares shall be delivered upon the
exercise of an SAR but a cash payment will be made in lieu thereof.
8.04 Shareholder Rights. No participant shall have any rights
as a shareholder with respect to shares subject to his Option or SAR until the
date he exercises such Option or SAR.
8.05 Cashless Exercise. To the extent permitted under the
applicable laws and regulations, at the request of the Participant and with the
consent of the Committee, the Company agrees to cooperate in a "cashless
exercise" of the Option. The cashless exercise shall be effected by the
Participant delivering to the Securities Broker instructions to exercise all or
part of the Option, including instructions to sell a sufficient number of shares
of Common Stock to cover the costs and expenses associated therewith.
Article IX
COMMON STOCK AND RESTRICTED STOCK
9.01 Award. In accordance with the provisions of Article IV, the
Committee will designate employees to whom an award of Common Stock and/or
Restricted Stock is to be made and will specify the number of shares of Common
Stock covered by such award or awards.
9.02 Vesting. In the case of Restricted Stock, on the date of the
award, the Committee may prescribe that the Participant's rights in the
Restricted Stock shall be forfeitable or otherwise restricted for a period of
time set forth in the Agreement and/or until certain financial performance
objectives are satisfied as determined by the Committee in its sole discretion.
Subject to the provisions of Article XII hereof, the Committee may award Common
Stock to a Participant which is not forfeitable and is free of any restrictions
or transferability.
9.03 Shareholder Rights. Prior to their forfeiture in accordance
with the terms of the Agreement and while the shares are Restricted Stock, a
Participant will have all rights of a shareholder with respect to Restricted
Stock, including the right to receive dividends and vote the shares; provided,
however, that (i) a Participant may not sell, transfer, pledge, exchange,
hypothecate, or otherwise dispose of Restricted Stock, (ii) the Company shall
retain custody of the certificates evidencing shares of Restricted Stock, and
(iii) the Participant will deliver to the Company a stock power, endorsed in
blank, with respect to each award of Restricted Stock.
-6-
Article X
PHANTOM STOCK
10.01 Award. Pursuant to this Plan or a separate plan or an
agreement establishing additional terms and conditions, the Committee may
designate employees to whom awards of Phantom Stock may be made and will specify
the number of shares of Common Stock covered by the award.
10.02 Vesting. The Committee may prescribe such terms and
conditions under which a Participant's right to receive payment for Phantom
Stock shall become vested.
10.03 Shareholder Rights. A Participant for whom Phantom Stock has
been credited generally shall have none of the rights of a shareholder with
respect to such Phantom stock. However, a plan or agreement for the use of
Phantom Stock may provide for the crediting of a Participant's Phantom Stock
account with cash or stock dividends declared with respect to Common Stock
represented by such Phantom Stock.
10.04 Payment. Payment to a Participant for Phantom Stock credited
to his account shall be made in cash, Common Stock or a combination of both
unless otherwise provided in any plan or agreement.
Article XI
ADJUSTMENT UPON CHANGE IN COMMON STOCK
Should the Company effect one or more (x) stock dividends, stock
split-ups, subdivisions or consolidations of shares or other similar changes in
capitalization; (y) spin-offs, spin-outs, split-ups, split-offs, or other such
distribution of assets to shareholders; or (z) direct or indirect assumptions
and/or conversions of outstanding Options due to an acquisition of the Company,
then the maximum number of shares as to which Grants and Awards may be issued
under this Plan shall be proportionately adjusted and their terms shall be
adjusted as the Committee shall determine to be equitably required, provided
that the number of shares subject to any Grant or Award shall always be a whole
number. Any determination made under this Article XI by the Committee shall be
final and conclusive.
The issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or property
or for labor or services, either upon direct sale or upon the exercise of rights
or warrants to subscribe therefor, or upon conversion of shares or
obligations-of the Company convertible into such shares or other securities,
shall not affect, and no adjustment by reason thereof shall be made with respect
to any Grant or Award.
Article XII
COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES
No Grant shall be exercisable, no Common Stock shall be issued, no
certificates for shares of Common Stock shall be delivered, and no payment shall
be made under this Plan except in compliance with all applicable Federal and
state laws and regulations (including, without
-7-
limitation, withholding tax requirements) and the rules of all domestic stock
exchanges on which the Company's shares may be listed. The Company may rely on
an opinion of its counsel as to such compliance. Any share certificate issued to
evidence Common Stock for which a Grant is exercised or an Award is issued may
bear such legends and statements as the Committee may deem advisable to assure
compliance with Federal and state laws and regulations. No Grant shall be
exercisable, no Common Stock shall be issued, no certificate for shares shall be
delivered, and no payment shall be made under this Plan until the Company has
obtained such consent or approval as the Committee may deem advisable from
regulatory bodies having jurisdiction over such matters.
Article XIII
GENERAL PROVISIONS
13.01 Effect on Employment. Neither the adoption of this Plan, its
operation, nor any documents describing or referring to this Plan (or any part
thereof) shall confer upon any employee any right to continue in the employ of
the Company or a Subsidiary or in any way affect any right and power of the
Company or a Subsidiary to terminate the employment of any employee at any time
with or without assigning a reason therefor.
13.02 Unfunded Plan. The Plan, insofar as it provides for a Grant or
an award of Phantom Stock, is not required to be funded, and the Company shall
not be required to segregate any assets that may at any time be represented by a
Grant or an award of Phantom Stock under this Plan.
13.03 Change of Control. At the discretion of the Committee, a
Participant's interest in Restricted Stock or Phantom Stock may be made
nonforfeitable and transferable as of a Change of Control Date. The Committee
may also provide in an Agreement that a Participant may elect, by written notice
to the Company within 60 days after a Change of Control Date, to receive, in
exchange for shares that were Restricted Stock or Phantom Stock immediately
before the Change of Control Date, a cash payment equal to the Fair Market value
of the shares surrendered on the last business day the Common Stock is traded on
the NASDAQ Market prior to receipt by the Company of such written notice.
Notwithstanding any other provision in this Plan to the contrary, unless the
Committee provides otherwise in an Agreement, a Grant may be exercised
immediately in full upon a Change of Control.
13.04 Rules of Construction. Headings are given to the articles
and sections of this Plan for ease of reference. The reference to any statute,
regulation, or other provision of law shall be construed to refer to any
amendment to or successor of such provision of law.
13.05 Amendment. The Board may amend or terminate this Plan from
time to time; provided, however, that no amendment may become effective until
shareholder approval is obtained if the amendment (i) materially increases the
aggregate number of shares that may be issued pursuant to Options and Common
Stock and Restricted Stock awards, (ii) materially increases the benefits to
Participants under the Plan, or (iii) materially changes the class of employees
eligible to become Participants. No amendment shall, without a Participant's
consent, adversely affect any rights of such Participant under any Grant or
Award outstanding at the time such amendment is made, except such an amendment
made to cause the Plan to qualify for the Rule 16b-3 exemption. No amendment
shall be made if it would disqualify the Plan from the exemption provided by
Rule 16b-3. The Committee may amend the terms of any Grant or Award
-8-
theretofore issued under this Plan, prospectively or retrospectively, and
include in such amendment the right of the Committee to pay a Participant cash
in lieu of shares of Common Stock upon the termination (by exercise or
otherwise) of an Option, but no such amendment shall impair the rights of any
Participant without the Participant's consent except such an amendment made to
cause the Plan, or Grant or Award, to qualify for the exemption provided by Rule
16b-3.
13.06 Duration of Plan. No Grant or Award may be issued under this
Plan before July 1, 1992, or after June 30, 2001; provided, however, a Grant of
a Reload option may be issued after June 30, 2001, upon the exercise of an
original Option as provided in Section 4.03 hereof.
13.07 Shareholder Approval. This Plan has been approved by the Board
of Directors of the Company and shall be effective as of July 1, 1992 subject,
however, to approval by the shareholders of the Company entitled to vote at the
1992 Annual Meeting of Shareholders.
