UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): JULY 21, 2005
THE BANC CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
0-25033 63-1201350
(Commission File Number) (IRS Employer Identification No.)
17 NORTH 20TH STREET, BIRMINGHAM, ALABAMA 35203
(Address of Principal Executive Offices) (Zip Code)
(205) 327-3600
(Registrant's Telephone Number, Including Area Code)
NOT APPLICABLE
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligations of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
SECTION 1 - REGISTRANT'S BUSINESS AND OPERATIONS
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On July 21, 2005, The Banc Corporation (the "Company") announced that it
had entered into agreements to buy out the existing employment agreements of
David R. Carter, Chief Financial Officer of the Company, and F. Hampton
McFadden, Jr., General Counsel of the Company, and had entered into new
agreements with Mr. Carter and Mr. McFadden relating to the transition of their
duties. These transactions were entered into as part of the continuing
transition of the Company to a new management team and structure, which began in
January 2005.
See Item 5.02 below for additional information, including a brief
description of the terms and conditions of such agreements that are material to
the Company.
ITEM 1.02. TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT.
On July 21, 2005, in connection with the arrangements with David R. Carter
and F. Hampton McFadden, Jr. described under Item 1.01 above and more
particularly described under Item 5.02 below, the Employment Agreement, dated
September 19, 2000, between the Company and Mr. Carter and the Employment
Agreement, dated January 16, 2001, between the Company and Mr. McFadden were
terminated.
See Item 5.02 below for additional information, including a brief
description of the terms and conditions of such agreements that are material to
the Company.
SECTION 5 - CORPORATE GOVERNANCE AND MANAGEMENT
ITEM 5.02. DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS;
APPOINTMENT OF PRINCIPAL OFFICERS.
BACKGROUND
Beginning in January 2005, the Company has implemented a significant
transition from its founding management team to a new management team believed
by the Company's Board of Directors to be well-positioned to lead the Company
into its next phase of operational improvement and growth and to enhance
stockholder value. In that regard, on January 24, 2005, the Board approved the
retention of a new senior management team led by C. Stanley Bailey, Chief
Executive Officer.
In connection with that management transition, certain rights were
triggered under the Company's existing employment agreements with David R.
Carter, Chief Financial Officer, and F. Hampton McFadden, Jr., General Counsel,
which would have allowed either or both of such officers to elect to terminate
their employment agreements and receive, among other things, three
years' compensation and associated benefits, together with certain other
benefits. In order to help ensure a smooth transition to the new senior
management team, the Board approved "standstill" agreements with the two
officers, pursuant to which they agreed to continue to work under their existing
employment agreements for a period ending January 24, 2006 while engaging in
discussions with the Company concerning potential revisions to their employment
arrangements. Under these standstill agreements, the officers reserved all
rights to terminate their employment and receive the specified separation
benefits.
As a result of those discussions, the Company and the officers reached
agreements whereby the Company would buy out its remaining obligations under the
original employment agreements. The Company and the employees signed Memorandum
Contracts reflecting the buyout arrangements as of June 30, 2005, which were
binding subject to approval of definitive contracts by the Board of Directors.
The Board approved those definitive contracts on July 21, 2005, effective as of
June 30, 2005. Specific information concerning the contracts is provided below.
The Company will recognize after-tax expense of approximately $2.0 million, or
$0.11 per share, with respect to the new buy-out contracts in the second quarter
of 2005.
AGREEMENTS WITH DAVID R. CARTER AND F. HAMPTON MCFADDEN, JR.
The Company was a party to employment agreements with Mr. Carter and Mr.
McFadden. These agreements are described in the Company's previous filings with
the Securities and Exchange Commission, including the Company's Proxy Statement
in connection with its 2005 Annual Meeting of Stockholders. These agreements
have been bought out and terminated, and the Company has entered into new
agreements with the officers, effective June 30, 2005. The material terms of the
new agreements are as set forth below:
Mr. Carter. The Company's subsidiary The Bank will pay to Mr. Carter, in a
lump sum, an amount equal to the discounted present value of three times his
annual base salary and other cash compensation, plus a cash amount in
satisfaction of the Company's contractual obligation to provide certain health
insurance benefits to him, for a total pre-tax cash payment of approximately
$1.25 million. In addition, Mr. Carter will be fully vested in stock options and
restricted stock previously granted to him and in benefits under his deferred
compensation agreement with the Company, and will be entitled to certain other
incidental benefits. In exchange for these payments, Mr. Carter will release the
Company from all obligations under his previous employment agreement and will be
restricted from certain activities that might be competitive with those of the
Company.
Mr. Carter will continue to serve as Chief Financial Officer of the
Company through the filing of the Company's Quarterly Report on Form 10-Q for
the three months ended September 30, 2005, and will serve thereafter as a
consultant to the Bank for a period ending January 24, 2006, during which time
he will receive his normal compensation.
Mr. McFadden. The Company's subsidiary The Bank will pay to Mr. McFadden,
in a lump sum, an amount equal to the discounted present value of three times
his annual base salary and other cash compensation, plus a cash amount in
satisfaction of the Company's contractual obligation to provide certain health
insurance benefits to him, for a total pre-tax cash payment of
approximately $1.10 million. In addition, Mr. McFadden will be fully vested in
stock options and restricted stock previously granted to him and in benefits
under his deferred compensation agreement with the Company, and will be entitled
to certain other incidental benefits. In exchange for these payments, Mr.
McFadden will release the Company from all obligations under his previous
employment agreement and will be restricted from certain activities that might
be competitive with those of the Company.
Mr. McFadden will continue to serve as General Counsel of the Company
through September 30, 2005, and will serve thereafter as an outside legal
advisor to the Bank for a period ending January 24, 2006, during which time he
will receive his normal compensation.
APPOINTMENT OF CHIEF ACCOUNTING OFFICER AND CONTROLLER
The Board of Directors has appointed Chris Gossett as Chief Accounting
Officer of the Company, an executive officer position, effective immediately.
Mr. Gossett, age 42, became Controller of The Bank in 1999 and was named Chief
Financial Officer of The Bank in 2003. Mr. Gossett is a Certified Public
Accountant. The Company and Mr. Gossett are not parties to any employment
agreement providing for a specified term of employment. However, the Company and
Mr. Gossett are parties to an agreement dated April 1, 2002, under which
Mr. Gossett would be entitled to one year's compensation (including bonus
compensation) and immediate vesting of all unvested amounts under stock
incentive or deferred compensation arrangements in the event that Mr. Gossett
voluntarily terminates his employment for Good Reason (as defined) within one
year after a Change in Control (as defined) of the Company.
In addition, the Board of Directors has appointed Nicole Stokes, currently
Controller of The Bank, to the additional position of Controller of the company,
a non-executive officer position. Ms. Stokes is a Certified Public Accountant.
SECTION 7 - REGULATION FD
ITEM 7.01. REGULATION FD DISCLOSURE.
On July 21, 2005, the Company issued a press release which is attached to
this Current Report on Form 8-K as Exhibit 99 and which announced the agreements
and transactions described in this report. This information is furnished
pursuant to Item 7.01 of Form 8-K and shall not be deemed to be "filed" for the
purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise
subject to the liabilities of that Section, unless we specifically incorporate
it by reference in a document filed under the Securities Act of 1933 or the
Securities Exchange Act of 1934. By filing this report on Form 8-K and
furnishing this information, we make no admission as to the materiality of any
information in this report that is required to be disclosed solely by reason of
Regulation FD.
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
Exhibit 10-1 Employment Agreement, dated September 19, 2000, by and between The
Banc Corporation and David R. Carter, filed as Exhibit (10)-14 to The
Banc Corporation's Annual Report on Form 10-K for the year ended
December 31, 2001, is hereby incorporated herein by reference.
Exhibit 10-2 Employment Agreement, dated as of January 16, 2001, by and between
The Banc Corporation and F. Hampton McFadden, Jr., filed as Exhibit
(10)-13 to The Banc Corporation's Registration Statement on Form S-l
(Registration No. 333-82428) is hereby incorporated herein by
reference.
Exhibit 10-3 Agreement, dated June 30, 2005, between The Banc Corporation, The
Bank and David R. Carter
Exhibit 10-4 Agreement, dated June 30, 2005, between The Banc Corporation, The
Bank and F. Hampton McFadden, Jr.
Exhibit 99 Press Release of The Banc Corporation issued July 21, 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Current Report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
THE BANC CORPORATION
Date: July 22, 2005 By: /s/ F. Hampton McFadden, Jr.
______________________________________
F. Hampton McFadden, Jr.
Executive Vice President, General Counsel
And Secretary