EXHIBIT 10.2
(FOR ORGANIZERS)
MOUNTAIN VALLEY COMMUNITY BANK
WARRANT AGREEMENT
THIS WARRANT AGREEMENT (the "Warrant Agreement") is made and entered into
effective as of the ____ day of __________, 2004 by and between MOUNTAIN VALLEY
COMMUNITY BANK (the "Bank") and ________________________, a resident of the
State of Georgia (the "Warrantholder").
WHEREAS, the Warrantholder was named as an organizing director of the Bank
and has placed assets at risk to fund the organizational expenses in expectation
of being granted warrants to purchase the number of shares of the common stock
of the Bank equal to the number of shares subscribed by the Warrantholder; and
WHEREAS, the Bank hereby grants the number of warrants to the
Warrantholder on the terms and conditions hereinafter stated as part of the
Warrantholder's investment in the Bank;
NOW, THEREFORE, this Warrant Agreement is entered into by the Bank and the
Warrantholder with the following terms:
1. WARRANT.
The Bank hereby grants to the Warrantholder warrants (the "Warrants") to
purchase _____________________ (___________) shares (the "Shares") of the
common stock ($5.00 par value) (the "Common Stock") of the Bank in accordance
with the terms and subject to the restrictions hereinafter set forth.
2. TERMINATION.
The Warrants have been granted on the date of this Warrant Agreement and
shall terminate on ___________, _____, the date which is ten years from the date
of the Bank's incorporation, unless sooner terminated as follows. The Warrants
shall terminate on the date that is ninety days from the date on which the
Warrantholder ceases to be an active officer, employee or director of the Bank
other than by reason of his or her death or disability and six months after the
Warrantholder ceases being an active officer, employee or director of the
Company by reason of his or her death or disability.
3. EXERCISE OF WARRANTS.
The Warrants must be exercised within ten (10) years from the date of the
Bank's incorporation, _____________, _____. If any Warrants are not exercised in
this ten (10)-year period, those Warrants shall be null and void.
No fractional shares will be issued upon exercise of Warrants, but the
Bank will pay the cash value of any fractional shares otherwise issuable.
The Warrants shall be exercised, in whole or in part, by written notice
directed to the Secretary of the Bank at the Bank's main office or at such other
address as the Bank shall have notified the Warrantholder in writing. Such
written notice shall be accompanied by payment in full in cash or by check or
shares of the Common Stock previously held by the Warrantholder of the Warrant
Price for the number of Shares specified in such written notice. In the event of
the Warrantholder's death or mental incapacity, the Warrants may be exercised by
the Warrantholder's personal representative.
4. VESTING.
The Warrants shall have the following vesting schedule:
VESTING PERCENTAGE
OF TOTAL
DATE WARRANTS GRANTED
---- ------------------
First Anniversary of the Date Hereof 33(1/3)%
Second Anniversary of the Date Hereof 33(1/3)%
Third Anniversary of the Date Hereof 33(1/3)%
5. WARRANT PRICE.
The price per share at which Shares may be purchased pursuant to exercise
of the Warrants (the "Warrant Price") shall be $10.00(1) (which amount has been
determined by the Board to be the fair market value per share of the Common
Stock on the date that these Warrants are granted).
6. EXERCISE OR FORFEITURE OF WARRANTS DUE TO CAPITAL BELOW MINIMUM
REQUIREMENTS.
If the Bank's capital falls below the minimum requirements, as determined
by the State of Georgia Department of Banking and Finance (the "Department") or
the Federal Deposit Insurance Corporation (the "FDIC"), and if directed by the
Department and/or the FDIC, the Bank can require the Warrantholder to exercise
or forfeit his or her Warrants.
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(1) Please note that since the dates of the original warrants the exercise
price has been reduced to $8.00 per share by virtue of a stock split.
7. ADJUSTMENTS IN CERTAIN EVENTS.
The Warrants granted hereunder shall be appropriately adjusted both as to
the number of shares subject to the Warrants and the Warrant Price for any
increase or decrease in the number of outstanding shares of Common Stock of the
Bank resulting from a stock split or payment of a stock dividend on the Common
Stock, a subdivision or combination of shares of the Common Stock, or a
reclassification of the Common Stock, and in the event of a merger or
consolidation in accordance with the following paragraph.
After any merger, consolidation or reorganization of any form involving
the Bank as a party thereto involving any exchange, conversion, adjustment or
other modification of the outstanding shares of the Bank's Common Stock,
Warrantholder at the time of such reorganization shall, at no additional cost,
be entitled, upon any exercise of his or her Warrant, to receive, in lieu of the
number of shares as to which such Warrant shall then so be exercised, the number
and class of shares of stock or other securities or such other property to which
such Warrantholder would have been entitled pursuant to the terms of the
agreement of merger or consolidation, if at the time of such merger or
consolidation, such Warrantholder had been a holder of record of a number of
shares of the Common Stock of the Bank equal to the number of shares as to which
such Warrant shall then be so exercised. Comparable rights shall accrue to each
Warrantholder in the event of successive mergers or consolidations of the
character described above.
The foregoing adjustments and the manner of their application will be in
the discretion of the Bank to determine.
8. LIMITATION ON PERCENTAGE OF COMMON STOCK OWNED.
Exercise of the Warrants shall not result in the Warrantholder (including
shares owned by the Warrantholder's spouse and minor children) owning more than
twenty percent (20%) of the outstanding Common Stock of the Bank, unless the
Department has approved the Warrantholder owning more than twenty percent (20%)
of the outstanding Common Stock of the Bank in the approval of the Bank's
charter application. Any attempt to exercise the Warrants which would result in
a violation of the above restriction shall be null and void to the extent of any
excess over the above limitation.
9. LIMITATION OF RIGHTS.
The Warrantholder or the personal representative of the Warrantholder is
not entitled, by virtue of being such a holder, to receive dividends or to
consent or to receive notice as a stockholder in respect to any meeting of
stockholders for the election of directors of the Bank or any other matters, or
to vote at any such meeting, or to any other rights whatsoever as a stockholder
of the Company. The Warrantholder or the personal representative of the
Warrantholder shall have no rights as a stockholder with respect to the Common
Stock covered by the Warrants until the Warrantholder or the personal
representative of the Warrantholder shall become the holder of record of such
Common Stock.
10. RESTRICTIONS ON TRANSFER AND PLEDGE.
The Warrants and all rights and privileges granted hereunder shall not be
transferred, assigned, pledged or hypothecated in any way, whether by operation
of law or otherwise, and shall not be subject to execution, attachment or
similar process. Upon any attempt to transfer, assign, pledge, hypothecate or
otherwise dispose of the Warrants or any right or privilege granted hereunder,
or upon the levy or any attachment or similar process upon the rights and
privileges herein conferred, the Warrants and the rights and privileges
hereunder shall become immediately null and void.
11. RESTRICTIONS ON ISSUANCE OF SHARES.
If at any time the Board of Directors of the Bank shall determine, in its
discretion, that listing, registration or qualification of the Common Stock
covered by the Warrants upon any securities exchange or under any state or
federal law, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition to the exercise of the Warrants, the
Warrants may not be exercised in whole or in part unless and until such listing,
registration, qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Board of Directors.
IN WITNESS WHEREOF, the Bank, acting by and through its duly authorized
officers, has caused this Warrant Agreement to be executed and the Warrantholder
has executed this Warrant Agreement, all as of the day and year first above
written.
MOUNTAIN VALLEY COMMUNITY BANK
[SEAL]
Attest: By: ____________________________
Xxxx X. Xxxxxx
By: __________________________ President
WARRANTHOLDER:
________________________________
Print Name: ____________________
