-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Fs9GQbY9ITY7mFqtwh7RT92RRxQnzMnVYSG1B7BwYf7p8m25xy0jjwmRXpoqkdw0 /yJV4y0DhnuZSoi8P3J23w== 0000912057-96-028391.txt : 19961206 0000912057-96-028391.hdr.sgml : 19961206 ACCESSION NUMBER: 0000912057-96-028391 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 19961205 EFFECTIVENESS DATE: 19961205 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: BROADWAY FINANCIAL CORP \DE\ CENTRAL INDEX KEY: 0001001171 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 954547287 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-17331 FILM NUMBER: 96676425 BUSINESS ADDRESS: STREET 1: 4835 W VENICE BLVD CITY: LOS ANGELES STATE: CA ZIP: 90019 BUSINESS PHONE: 2139311886 MAIL ADDRESS: STREET 1: 4835 WEST VENICE BLVD CITY: LOS ANGELES STATE: CA ZIP: 90019 S-8 1 FORM S-8 As filed with the Securities and Exchange Commission on December 5, 1996 REGISTRATION NO. 333-_____ - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------- FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ---------------------- BROADWAY FINANCIAL CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 95-4547287 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) ------------------------- 4835 WEST VENICE BOULEVARD, LOS ANGELES, CALIFORNIA 90019 (Address of principal executive offices) (zip code) BROADWAY FINANCIAL CORPORATION 1996 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS BROADWAY FINANCIAL CORPORATION LONG TERM INCENTIVE PLAN (Full title of the plan) ---------------------------- PAUL C. HUDSON BROADWAY FINANCIAL CORPORATION 4835 WEST VENICE BOULEVARD LOS ANGELES, CALIFORNIA 90019 (213) 931-1886 (Name, address, including zip code, and telephone number including area code, of agent for service) ---------------------------- Copies to: JAMES R. WALTHER MAYER, BROWN & PLATT 350 SOUTH GRAND AVENUE LOS ANGELES, CALIFORNIA 90071 (213) 229-9500 APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. /X/
CALCULATION OF REGISTRATION FEE - ------------------------------------------------------------------------------------------------- Proposed Proposed Title of Amount Maximum Maximum Amount of Securities to be Offering Price Aggregate Registration to be Registered Registered(1) Per Share(2) Offering Price Fee - ------------------------------------------------------------------------------------------------- Common Stock, $0.01 par value 89,269 $9.44 $842,699 $256 - -------------------------------------------------------------------------------------------------
(1) Of this number, 26,781 shares are being registered for issuance under the Stock Option Plan for Outside Directors and 62,488 shares are being registered for issuance under the Long Term Incentive Plan (the foregoing Plans are referred to herein collectively as the "Plans"). (2) Estimated solely for the purpose of calculating the amount of the registration fee. Pursuant to Rule 457(c) of the Securities Act of 1933, as amended, the price per share is estimated to be $9.44, based upon the average of the bid and asked prices of the common stock, par value $0.01 per share, of the Registrant as reported on the NASDAQ SmallCap Market as reported by Tradeline on December 3, 1996. THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE IMMEDIATELY UPON FILING IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, (THE "SECURITIES ACT") AND 17 C.F.R. Section 230.462. BROADWAY FINANCIAL CORPORATION. PART I INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS ITEMS 1. & 2. The documents containing the information for the Broadway Financial Corporation (the "Company" or the "Registrant") 1996 Stock Option Plan for Outside Directors and the Company's Long Term Incentive Plan (the "Plans") required by Part I of the Registration Statement will be sent or given to the participants in the Plans as specified by Rule 428(b)(1). Such documents are not filed with the Securities and Exchange Commission (the "SEC") either as a part of this Registration Statement or as a prospectus or prospectus supplement pursuant to Rule 424 in reliance on Rule 428. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents filed or to be filed with the SEC are incorporated by reference in this Registration Statement: (a) The Company's Registration Statement on Form S-1 (File No. 33-96814). (b) The Company's Annual Report on Form 10-KSB for the fiscal year ended December 31, 1995 (File No. 00027464). (c) The Company's Quarterly Report on Form 10-QSB filed by the Registrant for the fiscal quarter ended March 31, 1996 (File No. 00027464). (d) The Company's Quarterly Report on Form 10-QSB filed by the Registrant for the fiscal quarter ended June 30, 1996 (File No. 00027464). (e) The Company's Quarterly Report on Form 10-QSB filed by the Registrant for the quarter ended September 30, 1996 (File No. 00027464). (f) The description of Registrant's Common Stock contained in Registrant's Form 8-A (File No. 00027464), as filed with the SEC pursuant to Section 12(g) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 12b-15 promulgated thereunder on December 28, 1995. (g) All documents filed by the Registrant pursuant to Section 13(a), 13(c), 14 and 15(d) of the Exchange Act after the date hereof and prior to the filing of a post-effective amendment which indicates that all securities offered hereby have been sold or which deregisters all securities then remaining unsold. ANY STATEMENT CONTAINED IN THIS REGISTRATION STATEMENT, OR IN A DOCUMENT INCORPORATED OR DEEMED TO BE INCORPORATED BY REFERENCE HEREIN, SHALL BE DEEMED TO BE MODIFIED OR SUPERSEDED FOR PURPOSES OF THIS REGISTRATION STATEMENT TO THE EXTENT THAT A STATEMENT CONTAINED HEREIN, OR IN ANY OTHER SUBSEQUENTLY FILED DOCUMENT WHICH ALSO IS INCORPORATED OR DEEMED TO BE INCORPORATED BY REFERENCE HEREIN, MODIFIES OR SUPERSEDES SUCH STATEMENT. ANY SUCH STATEMENT SO MODIFIED OR -1- SUPERSEDED SHALL NOT BE DEEMED, EXCEPT AS SO MODIFIED OR SUPERSEDED, TO CONSTITUTE A PART OF THIS REGISTRATION STATEMENT. ITEM 4. DESCRIPTION OF SECURITIES Not applicable. ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL Not applicable. ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS Directors and officers of the Registrant are indemnified and held harmless against liability to the fullest extent permissible by the Delaware General Corporation Law ("DGCL") as it currently exists or as it may be amended provided any such amendment provides broader indemnification provisions than currently exists. This indemnification applies to the Directors who administer the Plans. Section 102(b)(7) of the DGCL provides that a corporation in its original certificate of incorporation or an amendment thereto may eliminate or limit the personal liability of a director for monetary damages for a breach of the director's fiduciary duty, except (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the DGCL (providing for liability of directors for the willful or negligent violation of Sections 160 or 173 of the DGCL relating to stock purchases and redemptions and payment of dividends) or (iv) for any transaction from which a director derived an improper personal benefit. The Registrant's Certificate of Incorporation provides for the limitation on personal liability of a director as permitted by Section 102(b)(7) of the DGCL. The Certificate of Incorporation and the Bylaws of the Company provide for indemnification of officers and directors to the fullest extent permitted by Delaware law. Section 145 of the DGCL provides that a corporation may indemnify any person, including an officer or director, who is, or is threatened to be made, a party to any threatened, pending or completed legal action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation) by reason of the fact that such person was an officer, director, employee or agent of such corporation, or is or was serving at the request of such corporation as an officer, director, employee or agent of another corporation, partnership, joint venture, trust or other enterprise. The indemnity may include expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided such officer, director, employee or agent acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation's best interests and, for criminal actions or proceedings, had no reasonable cause to believe that his or her conduct was unlawful. A Delaware corporation also may indemnify any such person who is, or is threatened to be made, a party to an action by or in the right of the corporation as provided above, except that no indemnification is permitted without judicial approval if such person is adjudged to be liable -2- to the corporation. If such person is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify him or her against the expenses (including attorneys' fees) which such person actually and reasonably incurred. In addition, the Company and its officers and directors are covered by directors' and officers' liability insurance, which generally provides coverage for losses directors and officers become obligated to pay, or for which the Company may be required or permitted by law to pay as indemnity to the directors and officers, for certain claims made against the directors and officers. ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. Not applicable. ITEM 8. LIST OF EXHIBITS. The following exhibits are filed with or incorporated by reference into this Registration Statement on Form S-8: 4.1 Form of Common Stock Certificate. 5.1 Opinion of Mayer, Brown & Platt, Los Angeles, California as to the legality of the Common Stock registered hereby. 23.1 Consent of Mayer, Brown & Platt (contained in the opinion included as Exhibit 5.1). 23.2 Consent of KPMG Peat Marwick LLP. 24.1 Power of Attorney is located on the signature pages. 99.1 Broadway Financial Corporation 1996 Stock Option Plan for Outside Directors. 99.2 Broadway Financial Corporation Long Term Incentive Plan. ITEM 9. UNDERTAKINGS The undersigned Registrant 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; -3- (ii) To reflect in the Prospectus any facts or events which, individually or together, represent a fundamental change in the information in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) To include any additional or changed material information on the plan of distribution. unless the information required by (i) and (ii) is contained in periodic reports filed by the Registrant pursuant to Section 13 or 15(d) of the Exchange Act that are incorporated by reference into this 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 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. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to trustees, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has 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. -4- SIGNATURES THE REGISTRANT. Pursuant to the requirements of the Securities Act of 1933, as amended, the 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 Los Angeles, State of California, on December 4, 1996. BROADWAY FINANCIAL CORPORATION By: /s/ Paul C. Hudson ------------------------------ Paul C. Hudson CHIEF EXECUTIVE OFFICER AND PRESIDENT POWER OF ATTORNEY Each person whose signature appears below constitutes and appoints Paul C. Hudson or Bob Adkins or any of them, such person's true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, to sign any or all amendments (including post-effective amendments) to this Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed by the following persons in the capacities and on the date indicated. /s/ Paul C. Hudson - ----------------------------------------- Paul C. Hudson Chief Executive Officer, President and Director /s/ Bob Adkins - ----------------------------------------- Bob Adkins Senior Vice President, Principal Financial Officer and Principal Accounting Officer /s/ Elbert T. Hudson - ----------------------------------------- Elbert T. Hudson Chairman of the Board /s/ Kellogg Chan - ----------------------------------------- Kellogg Chan Director /s/ Dr. Willis K. Duffy - ----------------------------------------- Dr. Willis K. Duffy Director /s/ Rosa M. Hill - ----------------------------------------- Rosa M. Hill Director /s/ A. Odell Maddox - ----------------------------------------- A. Odell Maddox Director /s/ Lyle A. Marshall - ----------------------------------------- Lyle A. Marshall Director /s/ Larkin Teasley - ----------------------------------------- Larkin Teasley Director DATED: December 4, 1996 EX-4.1 2 EXHIBIT 4.1 COMMON STOCK COMMON STOCK PAR VALUE $.01 CUSIP 111444105 SEE REVERSE FOR CERTAIN DEFINITIONS BROADWAY FINANCIAL CORPORATION INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE THIS CERTIFIES THAT SPECIMEN is the owner of: FULLY PAID AND NONASSESSABLE SHARES OF COMMON STOCK $.01 PAR VALUE PER SHARE OF BROADWAY FINANCIAL CORPORATION transferable on the books of the Corporation by the holder hereof in person or by duly authorized attorney upon the surrender of this Certificate properly endorsed. This certificate and the shares represented hereby are issued and shall be held subject to all the provisions of the Certificate of Incorporation of the Corporation and any amendments thereto (copies of which are on file with the Transfer Agent), to all of which provisions the holder by acceptance hereof, assents. This certificate is not valid unless countersigned and registered by the Transfer Agent and Registrar. The shares represented by this Certificate are not insured by the Federal Deposit Insurance Corporation or any other government agency. WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers. Dated: [SEAL] President Secretary Countersigned and Registered American Securities Transfer Incorporated (P.O. Box 1596, Denver, CO 80201) Transfer Agent and Registrar The shares represented by this certificate are subject to a limitation contained in the Certificate of Incorporation to the effect that in no event shall any record owner of any outstanding common stock which is beneficially owned, directly or indirectly, by a person who beneficially owns in excess of 10% of the outstanding shares of common stock (the "Limit") be entitled or permitted to any vote in respect of shares held in excess of the Limit. The Board of Directors of the Corporation is authorized by resolution(s), from time to time adopted, to provide the issuance of serial preferred stock in series and to fix and state the voting powers, designations, preferences and relative, participating, optional, or other special rights of the shares of each such series and the qualifications, limitations and restrictions thereof. The Corporation will furnish to any shareholder upon request and without charge a full description of each class of stock and any series thereof. The shares represented by this certificate may not be cumulatively voted on any matter. The affirmative vote of the holders of at least two-thirds of the voting stock of the Corporation, voting together as a single class, shall be required to approve certain business combinations and other transactions, pursuant to the Certificate of Incorporation or to amend certain provisions of the Certificate of Incorporation. The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common UNIF GIFTS MIN ACT - _______ custodian _______ (Cust) (Minor) TEN ENT - as tenants by the entireties under Uniform Gifts to Minors Act _________________________________ (State) JT TEN - as joint tenants with right of survivorship and not as tenants in common Additional abbreviations may also be used though not in the above list. For value received, ____________ hereby sell, assign and transfer unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFICATION NUMBER OF ASSIGNEE ________________________________________________________________________________ Please print or typewrite name and address including postal zip code of assignee __________________________________ shares of common stock represented by the within Certificate, and do hereby irrevocably constitute and appoint ___________________________________ Attorney to transfer the said stock on the books of the within-named Corporation with full power of substitution in the premises. DATED:________________________ ________________________________________________ NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. SIGNATURE GUARANTEED: _______________________________________________________ THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17A-d-15. EX-5.1 3 EXHIBIT 5.1 December 4, 1996 Board of Directors Broadway Financial Corporation 4835 West Venice Boulevard Los Angeles, California 90019 Ladies and Gentlemen: We have acted as special counsel to Broadway Financial Corporation, a Delaware corporation (the "Corporation"), in connection with the preparation and filing with the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, of a Registration Statement on Form S-8 (the "Registration Statement"), relating to the registration of up to 89,269 shares of Corporation common stock, $0.01 par value per share ("Common Stock"), to be issued pursuant to (i) the Corporation's 1996 Stock Option Plan for Outside Directors (the "Option Plan") upon the exercise of stock options ("Option Rights") and (ii) the Corporation's Long Term Incentive Plan (the "LTIP"). We have been requested by the Corporation to furnish this opinion to be included as an exhibit to the Registration Statement. We have reviewed the Registration Statement, the Certificate of Incorporation and Bylaws of the Corporation, the Option Plan, the LTIP, a specimen stock certificate evidencing the Common Stock of the Corporation and such other corporate records and documents as we have deemed appropriate for the purpose of rendering this opinion. We have also reviewed and relied upon the originals, or copies certified or otherwise identified to our satisfaction, such records of the Corporation and such other instruments, certificates and written and oral representations of public officials, and officers and representatives of the Corporation as we have deemed appropriate or relevant as a basis for the opinion set forth below. In addition, we have assumed, without independent verification, the genuineness of all signatures and the authenticity of all documents furnished to us and the conformity in all respects of copies to originals. For purposes of this opinion, we have also assumed that (i) the shares of Common Stock issuable pursuant to Option Rights granted under the terms of the Option Plan will continue to be Board of Directors Broadway Financial Corporation December 4, 1996 Page 2 validly authorized on the dates the Common Stock is issued pursuant to the Option Rights; (ii) on the dates the Option Rights are exercised, the Option Rights granted under the terms of the Option Plan will constitute valid, legal and binding obligations of the Corporation and will (subject to applicable bankruptcy, moratorium, insolvency, reorganization and other laws and legal principles affecting the enforceability of creditors' rights generally) be enforceable as to the Corporation in accordance with their terms; (iii) no change will occur in applicable law or the pertinent facts; and (iv) the provisions of applicable state securities laws will have been complied with to the extent required. Based upon the foregoing, and subject to the qualifications and assumptions set forth herein, we are of the opinion as of the date hereof that the shares of Common Stock to be issued pursuant to the Option Plan and the LTIP, when issued pursuant to and in accordance with the Registration Statement, the Option Plan and the LTIP and, upon receipt of the consideration required thereby, will be legally issued, fully paid and non-assessable shares of Common Stock of the Corporation. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. Very truly yours, /s/Mayer, Brown & Platt MAYER, BROWN & PLATT EX-23.2 4 EXHIBIT 23.2 CONSENT OF INDEPENDENT AUDITORS' The Board of Directors Broadway Financial Corporation: We consent to incorporation by reference in the registration statement dated on or about December 5, 1996, on Form S-8 of Broadway Financial Corporation and subsidiaries of our report dated March 11, 1996, relating to the consolidated balance sheets of Broadway Federal Bank, f.s.b. and subsidiary (formerly Broadway Federal Savings and Loan Association) as of December 31, 1995 and 1994, and the related consolidated statements of earnings, retained earnings, and cash flows for each of the years in the three-year period ended December 31, 1995, which report appears in the December 31, 1995, annual report on Form 10-KSB of Broadway Financial Corporation. /s/ KPMG Peat Marwick LLP Los Angeles, California December 5, 1996 EX-99.1 5 EXHIBIT 99.1 BROADWAY FINANCIAL CORPORATION 1996 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS I. PURPOSE The purpose of this 1996 Stock Option Plan for Outside Directors (the "PLAN") is to promote the growth and profitability of Broadway Financial Corporation (the "HOLDING COMPANY") and Broadway Federal Bank, f.s.b. (the "BANK") by providing Outside Directors (as defined in Section II(a)) of the Holding Company and its affiliates, including the Bank, with an incentive to achieve the long-term objectives of the Holding Company and to attract and retain non-employee directors of outstanding abilities by providing such outside directors with an opportunity to acquire an equity interest in the Holding Company. II. GRANT OF OPTIONS (a) INITIAL GRANT. Each member of the Board of Directors of the Holding Company or any of its affiliates not also serving as a full-time employee of the Holding Company or any of its affiliates (an "OUTSIDE DIRECTOR"), who was serving in such capacity on the date of the Holding Company's initial public offering of securities and who is continuing in such service at the effective date of this Plan, is hereby granted a nonqualified stock option ("OPTION") to purchase shares of the common stock, $0.01 par value of the Holding Company ("COMMON STOCK"), subject to adjustment pursuant to Section IV, based on the number of his or her years of service with the Holding Company or any of its affiliates on a non-cumulative basis in accordance with the following schedule: Years of Service Shares Granted ---------------- -------------- 0 - 2 892 3 - 14 1,620 15 - 18 3,101 The purchase price per share of the Common Stock deliverable on exercise of Options shall be the Fair Market Value (as defined in paragraph (d) below) of the Common Stock on the date of grant. The grants provided for in this paragraph (a) shall be deemed granted on the Effective Date (as defined in Section V). (b) GRANTS TO SUBSEQUENT OUTSIDE DIRECTORS. Each Outside Director who is first elected as a director subsequent to the Effective Date ("SUBSEQUENT OUTSIDE DIRECTOR") shall be granted an Option in accordance with the following: -1- (i) To the extent shares are then available under this Plan, as of the date on which such Subsequent Outside Director is qualified and first begins to serve as an Outside Director, the Subsequent Outside Director shall be granted an Option to purchase 892 shares of Common Stock, subject to adjustment pursuant to Section IV. (ii) The purchase price per share of the Common Stock deliverable upon exercise of such Option shall equal the Fair Market Value of a share of Common Stock on the date the Option is granted. (iii) If sufficient shares are not available under this Plan to fulfill the grants of Options provided for in subparagraph (i) above, and thereafter shares become available for such purpose, each Subsequent Outside Director who has not previously received an Option for the full number of shares set forth in subparagraph (i) above, shall receive an Option to purchase the number of shares of Common Stock determined by dividing pro rata among each such Subsequent Outside Directors the number of shares then available under this Plan, but in no event shall a Subsequent Outside Director receive an Option for a number of shares which exceeds the number of shares set forth in subparagraph (i). The date of grant for Options awarded under this subparagraph (iii) shall be the date shares become available. The purchase price per share of the Common Stock deliverable upon exercise of each such Option shall equal the Fair Market Value of a share of Common Stock on the date the Option is granted. (c) INELIGIBILITY. An Option under this Plan shall not be granted to any Outside Director who at any previous time was an employee of either the Holding Company or the Bank and in such capacity was eligible to receive any Options to purchase Common Stock. (d) FAIR MARKET VALUE. For purposes of this Plan, "Fair Market Value" means the average of the high and low bid prices of the Common Stock as reported by the Nasdaq Small-Cap Stock Market (as published by the Wall Street Journal, if then so published) or, if the Common Stock is then listed on or quoted through a stock exchange or transaction reporting system on or through which actual sale prices are regularly reported, the closing sale price of the Common Stock, on the grant date, or if the Common Stock was not traded on such date, on the next preceding day on which the Common Stock was quoted or traded, as the case may be. -2- III. TERMS AND CONDITIONS (a) OPTION AGREEMENT. Each Option shall be evidenced by a written option agreement between the Holding Company and the recipient specifying the number of shares of Common Stock that may be acquired through its exercise and containing such other terms and conditions as are necessary or appropriate and not inconsistent with the terms of this grant. (b) VESTING. Subject to paragraph (e) below, each Option granted shall vest (become exercisable) in five annual cumulative installments of twenty percent (20%) per year, commencing on the first anniversary of the grant date and each subsequent anniversary thereof. (c) MANNER OF EXERCISE. The Option may be exercised from time to time, in whole or in part to the extent then vested, by delivering a written notice of exercise to the Chief Executive Officer of the Holding Company. Such notice is irrevocable and must be accompanied by full payment of the exercise price (as determined in accordance with Section II(a) or (b)) in cash or shares of previously acquired Common Stock of the Holding Company, or in a combination of cash and previously acquired shares. To the extent shares of Common Stock are tendered in payment of all or part of the exercise price, such shares shall be valued at the Fair Market Value thereof on the date of exercise. (d) TRANSFERABILITY. Each option granted herein may be exercised only by the Outside Director to whom it is issued or in the event of the Outside Director's death, his or her personal representative(s) or designee(s), heir(s) or devisee(s), if applicable under paragraph (e) below. (e) TERMINATION OF SERVICE; CHANGE OF CONTROL. Upon the termination of Outside Director's service on the Board for any reason other than Disability (as defined herein), death, Removal for Cause (as defined herein) or, to the extent not prohibited by 12 C.F.R. Section 563b.3(g)(4), following a Change in Control (as defined herein) of the Bank or the Holding Company, the Outside Director's Option shall be exercisable within the period described in paragraph (f) below, but only to the extent the Option was vested at the date of termination. In the event of death or termination of service due to Disability of any Outside Director or, to the extent not prohibited by 12 C.F.R. Section 563b.3(g)(4), following a Change in Control of the Bank or Holding Company, an Option held by such Outside Director, whether or not exercisable at such time, shall become immediately exercisable by the Outside Director or the Outside Director's legal representatives or beneficiaries. In -3- the event of a Change in Control as the result of a Terminating Event (as defined herein), the Outside Director's Option will become exercisable pursuant to this paragraph only if no provision has been made in writing in connection with such Terminating Event for the continuance of this Plan and for the assumption of the Options theretofore granted hereunder, or the substitution for such Options of new awards issued by the successor corporation or, if applicable, the publicly traded entity that is the parent entity of the successor corporation, with such appropriate adjustments as may be determined or approved by a committee of the Board of Directors or its successor, in which event this Plan and the Options theretofore granted or substituted therefor shall continue in the manner and under the terms so provided. For purposes of this Plan the following terms are defined as follows: (i) As used herein, a "CHANGE IN CONTROL" of the Bank or the Holding Company shall mean an event of a nature that (i) would be required to be reported in response to Item 1 of a current report filed on Form 8-K pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT") as in effect on the Effective Date of this Plan; or (ii) results in any person acquiring control of the Bank or the Holding Company within the meaning of the Home Owners' Loan Act of 1933, as amended, and the rules and regulations promulgated by the Office of Thrift Supervision ("OTS") (or its predecessor agency), as in effect on the Effective Date of this Plan by the Board of Directors of the Holding Company (provided, that in applying the definition of change in control as set forth under the rules and regulations of the OTS, the Board shall substitute its judgment for that of the OTS), and, without limitation, such a Change in Control shall be deemed to have occurred at such time as (A) any "person" (as that term is used in Sections 13(d) and 14(d) of the Exchange Act and the regulations of the Securities and Exchange Commission ("SEC") thereunder, each as in effect on the date of the adoption of this Plan by the Board of Directors of the Holding Company, and including any such persons that may be deemed to be acting in concert with respect to the Bank or the Holding Company, or the acquisition, ownership or voting of Bank or Holding Company securities) is or becomes the "beneficial owner" (as defined in -4- Rule 13d-3 under the Exchange Act and the regulations of the SEC thereunder, each as in effect on the date of the adoption of this Plan by the Board of Directors of the Holding Company), directly or indirectly, of securities of the Bank or the Holding Company representing 20% or more of the Bank's or the Holding Company's outstanding securities except for any securities of the Bank purchased by the Holding Company in connection with the conversion of the Bank to stock form and any securities purchased by any tax-qualified employee benefit plan of the Bank or the Holding Company; or (B) individuals who constitute the Board on the date of the adoption of this Plan by the Board of Directors of the Holding Company (the "INCUMBENT BOARD") cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to the date hereof whose election was approved by a vote of at least three-quarters of the directors then comprising the Incumbent Board, or whose nomination for election by the Holding Company's stockholders was approved by the same nominating committee serving under an Incumbent Board, shall be, for purposes of this clause (B), considered as though he or she were a member of the Incumbent Board; or (C) a plan of liquidation, reorganization, merger, consolidation, sale of all or substantially all the assets of the Bank or the Holding Company or similar transaction is not the resulting entity (a "TERMINATING EVENT"), is approved by the Board of Directors and stockholders or otherwise occurs; or (D) solicitations of stockholders of the Holding Company, by someone other than the Incumbent Board of the Holding Company, seeking stockholder approval of a plan of reorganization, merger or consolidation of the Holding Company or Bank or similar transaction with one or more corporations as a result of which the outstanding shares of the class of securities then subject to this Plan are exchanged for or converted into cash or property or securities not issued by the Bank or the Holding Company shall be distributed; or (E) a tender offer is made for 20% or more of the voting securities of the Bank or the Holding Company; or (F) any other event, transaction or series of transactions occurs as a result of which any person may be deemed to "acquire -5- control" of the Bank or the Holding Company (as such terms are defined in the regulations of the OTS set forth at 12 C.F.R. Part 574 as in effect on the Effective Date). (ii) "DISABILITY" means the permanent and total inability by reason of mental or physical infirmity, or both, of an Outside Director to perform his or her duties as such. If requested by the Board of Directors, a medical doctor selected or approved by the Board of Directors must advise the Board that it is either not possible to determine when such disability will terminate or that it appears probable that such disability will be permanent during the remainder of such Director's lifetime. (iii) "REMOVAL FOR CAUSE" means the removal of the Outside Director by shareholder, regulatory or other appropriate action because of a material loss to the Holding Company or one of its affiliates caused by the Outside Director's personal dishonesty, willful misconduct, any breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, or the willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease and desist order. (f) TERMINATION OF OPTION. Each Option shall expire upon the earlier of (i) 120 months following the date of grant, or (ii) one year following the date on which the recipient ceases to serve in the capacity of Outside Director, consultant or advisory director for any reason other than Removal for Cause. If the Outside Director dies before fully exercising any portion of an Option then exercisable, such Option may be exercised by such Outside Director's beneficiary, personal representative(s), heir(s) or devisee(s) at any time within the one year period following his or her death; provided, however, that in no event shall the option be exercisable more than 120 months after the date of its grant. If the Outside Director's service terminates on account of Removal for Cause, Option awarded to him or her shall expire upon such removal. IV. COMMON STOCK SUBJECT TO THIS PLAN The shares which shall be issued and delivered upon exercise of Options granted under this Plan may be either authorized and unissued shares of Common Stock or authorized and issued shares of Common Stock purchased by the Holding Company. The number of -6- shares of Common Stock reserved for issuance under this Plan shall not exceed 26,781 shares of the Common Stock, subject to adjustments pursuant to this Section IV. Any shares of Common Stock subject to an Option which for any reason either terminates unexercised or expires, shall again be available for issuance under this Plan. In the event of any change or changes in the outstanding Common Stock of the Holding Company by reason of any stock dividend or stock split, recapitalization, reorganization, merger, consolidation, spin-off, combination or any similar corporate change, or other increase or decrease in such shares effected without receipt or payment of consideration by the Company, the number of shares of Common Stock which may be issued under this Plan, the number of shares of Common Stock subject to Options granted under this Plan and the exercise price of such Options, shall be automatically adjusted to prevent dilution or enlargement of the rights granted to recipient under this Plan. V. APPROVAL AND EFFECTIVE DATE OF THIS PLAN Pursuant to OTS regulations, this Plan must be approved by the OTS and a majority of the Holding Company's stockholders. This Plan shall become effective on December 1, 1995 (the "EFFECTIVE DATE"), stockholder approval has been obtained. No Options shall be granted under this Plan prior to the Effective Date. In the event this Plan does not receive stockholder approval, this Plan shall be null and void. VI. TERMINATION OF THIS PLAN The right to grant Options under this Plan will terminate automatically upon the earlier of ten years after the Effective Date of this Plan or the issuance of the maximum number of shares of Common Stock reserved for issuance pursuant to this Plan. VII. AMENDMENT OF THIS PLAN This Plan may be amended from time to time by the Board of Directors of the Company provided that Section II and III hereof shall not be amended more than once every six months other than to comport with the Internal Revenue Code of 1986, as amended, or the Employee Retirement Income Security Act of 1974, as amended, or the respective rules thereunder. Except as provided in Section IV hereof, rights and obligations under any Option granted before an amendment shall not be altered or impaired by such amendment without the written consent of the optionee. If this Plan satisfies the requirements of Rule 16b-3 ("RULE 16b-3") of the Exchange Act, and an amendment would require stockholder approval to retain this Plan's exemption under Rule 16b-3, then subject to the discretion of the Board of Directors of the -7- Holding Company, such amendment shall be presented to stockholders for ratification, provided, however, that the failure to obtain stockholder ratification shall not affect the validity of this Plan as so amended and the Options granted thereunder. VIII. APPLICABLE LAW This Plan shall be governed by and construed in accordance with the internal laws of the State of California. IX. COMPLIANCE WITH SECTION 16 Unless otherwise hereafter determined by the Board of Directors of the Holding Company, to the extent that any provision of this Plan fails to satisfy the requirements of Rule 16b-3, such provisions shall be deemed null and void, to the extent permitted by law. -8- EX-99.2 6 EXHIBIT 99.2 BROADWAY FINANCIAL CORPORATION LONG TERM INCENTIVE PLAN Section 1 PURPOSE The purpose of this Broadway Financial Corporation 1996 Long Term Incentive Plan (this "PLAN") is to increase stockholder value and to advance the interests of Broadway Financial Corporation (the "HOLDING COMPANY") and its subsidiary, Broadway Federal Bank, f.s.b. (the "BANK") (the Holding Company and Bank are collectively referred to herein as the "COMPANY") by awarding equity based incentives designed to attract, retain and motivate employees. . Section 2 ADMINISTRATION 2.1. ADMINISTRATION BY COMMITTEE. This Plan shall be administered by a committee (the "COMMITTEE") consisting of two or more members of the Holding Company's Board of Directors ("Board"), who are appointed and may be removed by the Board, and who are "disinterested persons" within the meaning of Securities and Exchange Commission Rule 16b-3 ("RULE 16B-3") promulgated under the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT") and "outside directors" within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the "CODE"). 2.2. AUTHORITY. Subject to the provisions of this Plan, the Committee shall have the authority to (a) manage and control the operation of this Plan, (b) interpret and construe the provisions of this Plan, and prescribe, amend and rescind rules and regulations relating to this Plan, (c) make awards under this Plan in such forms and amounts and subject to such restrictions, limitations and conditions as it deems appropriate, including, without limitation, awards which are made in combination with or in tandem with other awards (whether or not contemporaneously granted), (d) modify the terms of outstanding awards, (e) prescribe the form of agreement, certificate or other instrument evidencing any award under this Plan, (f) correct any defect or omission and reconcile any inconsistency in this Plan or in any award hereunder, and (g) make all other determinations and take all other actions as it deems necessary or desirable for the implementation and administration of this Plan. The determination of the Committee on matters within its authority shall be conclusive and binding on the Company and all other persons. Section 3 PARTICIPATION All employee of the Company, or of any subsidiaries or affiliates, are eligible to receive awards granted pursuant to this Plan. Subject to the terms and conditions of this Plan, the Committee shall determine and designate from time to time the employees of the Company and its subsidiaries and affiliates (including employees who are directors) who shall receive awards under this Plan ("PARTICIPANTS"). Section 4 SHARES SUBJECT TO THIS PLAN 4.1. NUMBER OF SHARES RESERVED. Subject to adjustment in accordance with subsection 4.2, the maximum number of shares of common stock, $0.01 par value, of the Holding Company ("COMMON STOCK") which may be issued under this Plan shall not exceed 62,488 shares in the aggregate, and shall not exceed 4,463 shares with respect to any one individual in any calendar year. Such shares may be either authorized and unissued shares, treasury shares or a combination thereof, as the Committee shall determine. The number of shares related to awards that expire unexercised or are forfeited, surrendered, terminated or cancelled (except for shares of Common Stock withheld or surrendered to satisfy tax withholding obligations) shall again be available for additional awards under this Plan unless this Plan shall have terminated. 4.2. ADJUSTMENTS TO SHARES RESERVED. In the event of any merger, consolidation, reorganization, recapitalization, spinoff, stock dividend, stock split, reverse stock split, exchange or other distribution with respect to shares of Common Stock or other change in the corporate structure or capitalization of the Company affecting the Common Stock, the type and number of shares of stock which are or may be subject to awards under this Plan and the terms of any outstanding awards (including the price at which shares of stock may be issued pursuant to an outstanding award) shall be equitably adjusted by the Committee, in its sole discretion, to preserve the value of benefits awarded or to be awarded to Participants under this Plan. Section 5 STOCK OPTIONS 5.1. AWARDS. Subject to the terms and conditions of this Plan, the Committee shall designate the Participants to whom options to purchase shares of Common Stock ("OPTIONS") are to be awarded under this Plan and shall determine the number, type and terms of the Options to be awarded to each of them. Each Option awarded under this Plan shall be a "nonqualified stock option" for tax purposes, unless the Option satisfies all of the -2- requirements of Section 422 of the Code and the Committee designates such Option as an "Incentive Stock Option". 5.2. OPTION PRICE. The "Option Price" for any Option awarded hereunder shall not be less than the Fair Market Value of a share of Common Stock on the date the Option is awarded. The "Fair Market Value" of a share of Common Stock as of any date shall be equal to the average of the high and low bid prices of the Common Stock or the closing sale price thereof as reported by an applicable transaction reporting system or stock exchange on the date preceding the applicable date or, if no bid quotations or sale prices of Common Stock are reported on such date, the average of the high and low bid prices or closing sale price of a share of Common Stock on the date as of which trading in the Common Stock was last reported on the applicable transaction reporting system or exchange. If the Common Stock is not listed or admitted to trading on any exchange or system that reports actual sale prices or bid and asked quotations, the Fair Market Value of a share of Common Stock shall be as determined in good faith by the Committee. 5.3. OPTION EXPIRATION DATE. All rights to purchase shares of Common Stock pursuant to an Option shall cease as of the date (the "OPTION EXPIRATION DATE") established by the Committee at the time of the award of such Option (subject to any earlier permitted termination by the Committee), but in no event later than the date which is ten years after the date on which the Option is awarded. Unless provided otherwise by the Committee, if the employment of a Participant terminates for any reason, his or her nonvested options shall terminate and his or her vested options shall be exercisable no later than the earliest to occur of (i) twelve months after termination of the Participant's employment if termination is by reason of his or her becoming disabled (within the meaning of Section 22(e)(3) of the Code) or his or her death, (ii) 90 days after the date of his or her termination of employment for any other reason, or (iii) the Option Expiration Date. 5.4. VESTING. Each Option awarded under this Plan shall vest (become exercisable), either in whole or in part, at such time or times as shall be determined by the Committee at the time the Option is granted, or at such earlier time or times as the Committee shall subsequently determine. 5.5. MANNER OF EXERCISE. An Option may be exercised by a Participant (or, in the event of his or her death, by the person or persons to whom that right passes by will or by the laws of descent and distribution), to the extent then vested, by giving written notice of such exercise to the Secretary of the Company at the principal executive offices of the Company prior to the Option Expiration Date; provided, however, that an Option may only be exercised with respect to whole shares of Common Stock. -3- Such notice shall specify the number of shares of Common Stock to be purchased and shall be accompanied by payment of the Option Price for such shares (and, if required by the Committee, any applicable withholding taxes) in such form and manner as the Committee may from time to time approve. Section 6 STOCK APPRECIATION RIGHTS 6.1. AWARDS. Subject to the terms and conditions of this Plan, the Committee shall designate the employees to whom stock appreciation rights ("SARS") are to be awarded under this Plan and shall determine the number and terms of the SARs to be awarded to each of them. An SAR may be awarded in tandem with an Option at the time the Option is granted or thereafter. Notwithstanding any provision of this Section 6 to the contrary, an SAR awarded in tandem with an Option shall be exercisable only to the extent that the related Option is exercisable. 6.2. PAYMENT. Subject to the terms and conditions of this Plan, upon exercise of an SAR, a Participant shall be entitled to receive the number of shares of Common Stock having a Fair Market Value (as of the date of exercise) equal to: (a) the number of shares of Common Stock as to which the SAR is exercised; MULTIPLIED BY (b) the excess of the Fair Market Value (as of the date of exercise) of a share of Common Stock over the exercise price of the SAR; provided, however, that, in lieu of fractional shares of Common Stock, a Participant shall be entitled to receive an appropriate cash payment; and provided, further, that the Committee, in its sole discretion, may elect to settle the SAR (or any portion thereof) in cash equal to the Fair Market Value on the exercise date of any or all of the shares of Common Stock that would otherwise be issuable upon such exercise. 6.3. SAR EXPIRATION DATE. All rights to acquire shares of Common Stock pursuant to an SAR shall cease as of the date (the "SAR EXPIRATION DATE") established by the Committee at the time of award (subject to any earlier permitted termination by the Committee), but in no event later than the date which is ten years after the date on which the SAR is awarded. Unless provided otherwise by the Committee, if the employment of a Participant terminates for any reason, his or her nonvested SARs shall terminate and his or her vested SARs shall be exercisable no later than the earliest to occur of (i) twelve months after -4- termination of the Participant's employment if termination is by reason of his or her becoming disabled (within the meaning of Section 22(e)(3) of the Code) or his or her death, (ii) 90 days after the date of his or her termination of employment for any other reason, or (iii) the SAR Expiration Date. 6.4. VESTING. Each SAR awarded under this Plan shall become exercisable, either in whole or in part, at such time or times as shall be determined by the Committee at the time the SAR is granted, or at such earlier times as the Committee shall subsequently determine. 6.5. MANNER OF EXERCISE. An SAR may be exercised, in whole or in part to the extent then vested, by giving written notice of such exercise to the Secretary of the Company prior to the date on which the SAR expires. Such notice shall specify the number of shares with respect to which the SAR is exercised. As soon as practicable after receipt of such notice, the Company shall deliver to the Participant certificates for the shares of Common Stock or cash or both to which the Participant is entitled pursuant to subsection 6.2. To the extent that an SAR that is awarded in tandem with an Option is exercised, the related Option will be cancelled, and to the extent that an Option awarded in tandem with an SAR is exercised, the tandem SAR will be cancelled. Section 7 LIMITED STOCK APPRECIATION RIGHTS 7.1. AWARDS. Subject to the terms and conditions of this Plan, the Committee may designate that limited stock appreciation rights ("LSARS") are to be awarded in tandem with all or a portion of any Option award under this Plan. An LSAR may be awarded in tandem with an Option at the time the Option is granted or thereafter. Notwithstanding any provision of this Section 7 to the contrary, an LSAR shall be exercisable only to the extent that the related Option is exercisable. Unless otherwise provided by the Committee, an LSAR shall not be exercised in whole or part prior to the date which is six months after the date of award of the LSAR and may only be exercised following a Change in Control (as defined in subsection 7.5) of the Company. 7.2. PAYMENT. Subject to the terms and conditions of this Plan, upon exercise of an LSAR, a Participant shall be entitled to receive a cash payment equal to: (a) the number of shares of Common Stock as to which the LSAR is exercised; MULTIPLIED BY -5- (b) the excess of the Fair Market Value (as of the date of exercise) of a share of Common Stock over the exercise price of the LSAR. 7.3. LSAR EXPIRATION DATE. All rights to exercise an LSAR shall cease as of the date (the "LSAR EXPIRATION DATE") established by the Committee at the time of the award (subject to any earlier permitted termination by the Committee), but in no event later than the date which is ten years after the date on which the LSAR is awarded. Unless provided otherwise by the Committee, if the employment of a Participant terminates for any reason, his or her nonvested LSARs shall terminate and his or her vested LSARs shall be exercisable no later than the earliest to occur of (i) twelve months after termination of the Participant's employment if termination is by reason of his or her becoming disabled (within the meaning of Section 22(e)(3) of the Code) or his or her death, (ii) 90 days after the date of his or her termination of employment for any other reason, or (iii) the LSAR Expiration Date. Notwithstanding any provision of this subsection 7.3 to the contrary, an LSAR shall be exercisable only to the extent that the underlying Option is exercisable. 7.4. MANNER OF EXERCISE. An LSAR may be exercised, in whole or in part to the extent then vested, by giving written notice of such exercise to the Secretary of the Company after the date of a Change in Control and prior to the date on which the LSAR expires. Such notice shall specify the number of shares with respect to which the LSAR is exercised. To the extent that an LSAR is exercised, the related Option will be cancelled, and to the extent that an Option awarded in tandem with an LSAR is exercised, the tandem LSAR will be cancelled. Section 8 RESTRICTED STOCK 8.1. AWARDS. Subject to the terms and conditions of this Plan, the Committee shall designate the employees to whom shares of "Restricted Stock" shall be awarded under this Plan and determine the number of shares and the terms and conditions of each such award. Each Restricted Stock award shall entitle the Participant to receive shares of Common Stock upon the terms and conditions specified by the Committee and subject to the following provisions of this Section 8. 8.2. RESTRICTIONS. All shares of Restricted Stock awarded hereunder shall be subject to such restrictions as the Committee may determine, including, without limitation, any or all of the following: -6- (a) a required period of employment with the Company, as determined by the Committee, prior to the vesting of the shares of Restricted Stock; (b) a prohibition against the sale, assignment, transfer, pledge, hypothecation or other encumbrance of the shares of Restricted Stock for a specified period as determined by the Committee; and (c) a requirement that the holder of shares of Restricted Stock forfeit all or a part of such shares in the event of termination of his or her employment during any period in which such shares are subject to restrictions. All restrictions on shares of Restricted Stock awarded pursuant to this Plan shall expire, and such shares shall vest in the Participant when they were awarded, at such time or times as the Committee shall specify. 8.3. REGISTRATION OF SHARES. Shares of Restricted Stock awarded pursuant to this Plan shall be registered in the name of the Participant and, in the discretion of the Committee, may be deposited with an entity designated by the Committee or with the Company. The Committee may require the Participant to endorse a stock power in blank with respect to shares of Restricted Stock awarded to the Participant. 8.4. STOCKHOLDER RIGHTS. Subject to the terms and conditions of this Plan, during any period in which shares of Restricted Stock are subject to forfeiture or restrictions on transfer, each Participant who has been awarded shares of Restricted Stock shall have such rights of a stockholder with respect to such shares as the Committee may designate at the time of the award, including the right to vote such shares and the right to receive all dividends paid on such shares. Unless otherwise provided by the Committee, stock dividends or dividends in kind and any other securities distributed with respect to Restricted Stock shall be restricted to the same extent and subject to the same terms and conditions as the Restricted Stock to which they are attributable. 8.5. LAPSE OF RESTRICTIONS. Subject to the terms and conditions of this Plan, at the end of any time period during which the shares of Restricted Stock are subject to forfeiture or restrictions on transfer, such shares will vest and thereupon be delivered free of all restrictions to the Participant (or to the Participant's legal representative, beneficiary or heir). Section 9 GENERAL -7- 9.1. EFFECTIVE DATE. This Plan will become effective on the date it is adopted by the Holding Company's Board of Directors, subject to its approval by the Company's stockholders. Awards may be issued under this Plan prior to the time stockholder approval is obtained, but if stockholder approval is not received within twelve months of this Plan's adoption, such awards shall be cancelled and be of no effect. In no event may an Option or SAR be exercised, or restrictions on Restricted Stock lapse, prior to the date stockholder approval is obtained. 9.2. DURATION. This Plan shall remain in effect until all awards made under this Plan have either been satisfied by the issuance of shares of Common Stock or the payment of cash or been terminated in accordance with the terms of this Plan and the award and until all restrictions imposed on shares of Common Stock issued under this Plan have lapsed. No award may be made under this Plan after the tenth anniversary of the date this Plan is adopted by the Company's Board of Directors. 9.3. NON-TRANSFERABILITY OF INCENTIVES. No Option, SAR, LSAR or share of Restricted Stock may be transferred, pledged or assigned by the holder thereof (except, in the event of the holder's death, by will or the laws of descent and distribution), and the Company shall not be required to recognize any attempted assignment of such rights by any Participant. During a Participant's lifetime, awards may be exercised only by him or her or by his or her guardian or legal representative. 9.4. EFFECT OF TERMINATION OF EMPLOYMENT OR DEATH. In the event that a Participant ceases to be an employee of the Company for any reason, including death, any awards then outstanding may be exercised or shall expire in accordance with the terms of this Plan and the award. 9.5. EFFECT OF CHANGE IN CONTROL. (a) To the extent not then prohibited by 12 C.F.R. Section 563b.3(g)(4) or other applicable regulation or law, unless determined otherwise by the Committee, upon a Participant's termination of employment within the twelve months following a Change in Control, all unvested Restricted Stock awards shall become fully vested and all Options, SARs and LSARs shall be exercisable for a period ending on the earlier of the Expiration Date of the Option, SAR or LSAR or the first anniversary of the Participant's termination of employment. Notwithstanding the foregoing provisions of this subsection 9.5, in the event of a Change in Control as the result of a Terminating Event, a Participant's Options, SARs, LSARs and Restricted Stock will become exercisable pursuant to this paragraph only if no provision has been made in writing in connection -8- with such Terminating Event for the continuance of this Plan and for the assumption of the awards theretofore granted hereunder, or the substitution for such awards of new awards issued by the successor corporation or, if applicable, the publicly traded entity that is the parent entity of the successor corporation, with such appropriate adjustments as may be determined or approved by the Committee, in which event this Plan and the awards theretofore granted or substituted therefor shall continue in the manner and under the terms so provided. (b) As used in this Plan, a "Change in Control" of the Company shall mean an event of a nature that (i) would be required to be reported in response to Item 1 of a current report filed on Form 8-K pursuant to Section 13 or 15(d) of the Exchange Act as in effect on the Effective Date of this Plan; or (ii) results in any person acquiring control of the Bank or the Holding Company within the meaning of the Home Owners' Loan Act of 1933, as amended and the rules and regulations promulgated by the Office of Thrift Supervision ("OTS") (or its predecessor agency), as in effect on the Effective Date of this Plan, (provided, that in applying the definition of change in control as set forth under the rules and regulations of the OTS, the Board shall substitute its judgment for that of the OTS); and, without limitation, such a change in control shall be deemed to have occurred at such time as (A) any "person" (as that term is used in Sections 13(d) and 14(d) of the Exchange Act and the regulations of the SEC thereunder, each as in effect on the date of the adoption of this Plan by the Board of Directors of the Holding Company, and including any such persons that may be deemed to be acting in concert with respect to the Bank or the Holding Company, or the acquisition, ownership or voting of Bank or Holding Company securities) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act and the regulations of the SEC thereunder, each as in effect on the date of the adoption of this Plan by the Board of Directors of the Holding Company), directly or indirectly, of securities of the Bank or the Holding Company representing 20% or more of the Bank's or the Holding Company's outstanding securities except for any securities of the Bank purchased by the Holding Company in connection with the conversion of the Bank to the stock form and any securities purchased by any tax-qualified employee benefit plan of the Bank; or (B) individuals who constitute the Board on the date of the adoption of this Plan by the Board of Directors of the Holding Company (the "INCUMBENT BOARD") cease for any -9- reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to the date hereof whose election was approved by a vote of at least three-quarters of the directors then comprising the Incumbent Board, or whose nomination for election by the Holding Company's stockholders was approved by the same Nominating Committee serving under an Incumbent Board, shall be, for purposes of this clause (B), considered as though he were a member of the Incumbent Board; or (C) a plan of liquidation reorganization, merger, consolidation, sale of all or substantially all the assets of the Bank or the Holding Company or similar transaction in which the Bank or Holding Company is not the resulting entity (a "TERMINATING EVENT") is approved by the Board and the stockholders or otherwise occurs; or (D) solicitations of stockholders of the Holding Company, by someone other than the Incumbent Board of the Holding Company, seeking stockholder approval of a plan of reorganization, merger or consolidation of the Holding Company or Bank or similar transaction with one or more corporations as a result of which the outstanding shares of the class of securities then subject to this Plan are exchanged for or converted into cash or property or securities not issued by the Bank or the Holding Company shall be distributed; or (E) a tender offer is made for 20% or more of the voting securities of the Bank or the Holding Company; or (F) any other event, transaction or series of transactions occurs as a result of which any person may be deemed to "acquire control" of the Bank or the Holding Company (as such terms are defined in the regulations of the OTS set forth at 12 C.F.R. Part 574 as in effect on the effective date of this Plan). 9.6. COMPLIANCE WITH APPLICABLE LAW AND WITHHOLDING. (a) This Plan shall be governed by and construed in accordance with the internal laws of the State of California. Notwithstanding any other provision of this Plan, the Company shall have no obligation to issue any shares of Common Stock under this Plan if such issuance would violate any applicable law or any applicable regulation or requirement of any securities exchange or similar entity. (b) Prior to the issuance of any shares of Common Stock under this Plan, the Company may require a written statement that the recipient is acquiring the shares for investment and not for the purpose or with the intention of distributing the shares and will not dispose of them in violation of the registration requirements of Securities Act of 1933, as amended. -10- (c) With respect to any person who is subject to Section 16(a) of the Exchange Act, the Committee may, at any time, add such conditions and limitations to any award under this Plan that it deems necessary or desirable to comply with the requirements of Rule 16b-3. (d) If, at any time, the Company, in its sole discretion, determines that the listing, registration or qualification (or any updating of any of the foregoing) of any type of award, or the shares of Common Stock issuable pursuant thereto, is necessary on any securities exchange or under any federal or state securities or blue sky law, or that the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, any award, the issuance of shares of Common Stock pursuant to any award, or the removal of any restrictions imposed on shares subject to an award, such award shall not be made and the shares of Common Stock shall not be issued or such restrictions shall not be removed, as the case may be, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Company. (e) All awards and payments under this Plan are subject to withholding of all applicable taxes and the Company shall have the right to withhold from any award under this Plan or to collect as a condition of any payment under this Plan, as applicable, any taxes required by law to be withheld. To the extent provided by the Committee, a Participant may elect to have any distribution otherwise required to be made under this Plan to be withheld or to surrender to the Company shares of Common Stock already owned by the Participant to fulfill any tax withholding obligation. 9.7. NO CONTINUED EMPLOYMENT. This Plan does not constitute a contract of employment or continued service, and participation in this Plan will not give any employee or Participant the right to be retained in the employ of the Company or the right to continue as a director of the Company or any right or claim to any benefit under this Plan unless such right or claim has specifically accrued under the terms of this Plan or the terms of any award under this Plan. 9.8. TREATMENT AS A STOCKHOLDER. Any award to a Participant under this Plan shall not create any rights in such Participant as a stockholder of the Holding Company until shares of Common Stock are registered in the name of the Participant. -11- 9.9. AMENDMENT OF THIS PLAN. The Board may, at any time and in any manner, amend, suspend or terminate this Plan; provided, however, that no such amendment or discontinuance shall: (a) make any "material" (as such term is interpreted from time to time for purposes of Rule 16b-3) increase in the number of shares reserved under subsection 4.1 without stockholder approval; (b) make any other change that would disqualify this Plan, or any award granted under this Plan, intended to be so qualified, from the exemption provided by Rule 16b-3; or (c) alter or impair the rights of Participants with respect to awards previously made under this Plan without the consent of the holder thereof. -12- -----END PRIVACY-ENHANCED MESSAGE-----