SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement. [ ] Confidential, for use of the
Commission only (as permitted by
Rule 14a-6(e)(2)).
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material pursuant to Rule 14a-12
Community Central Bank Corporation
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
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COMMUNITY CENTRAL BANK CORPORATION
120 NORTH MAIN STREET
MOUNT CLEMENS, MI 48043
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 18, 2006
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of COMMUNITY
CENTRAL BANK CORPORATION will be held at the Best Western Concorde Inn, 44315
Gratiot Avenue, Clinton Township, Michigan, on Tuesday, April 18, 2006, at 9:00
a.m., for the purpose of considering and voting upon the following matters:
1. ELECTION OF DIRECTORS. To elect three Class I directors each for a
three-year term, as detailed in the accompanying proxy statement.
2. AMENDMENT TO THE 2002 INCENTIVE PLAN TO ADD 100,000 SHARES TO EXISTING
PLAN: Increase the number of shares of common stock for which awards may be
granted under the 2002 Incentive Plan by 100,000 shares, which is approximately
2.7% of the outstanding shares of the Corporation as of the date of this proxy
statement.
3. OTHER BUSINESS. To transact such other business as may properly be
brought before the annual meeting, or any adjournments of the meeting. As of the
date of this proxy statement, the Board of Directors of the Corporation is not
aware of any such other business.
Only those stockholders of record at the close of business on Monday,
February 27, 2006, shall be entitled to notice of and to vote at the annual
meeting or any adjournments or postponements thereof.
To ensure that your shares are represented at the annual meeting, please
take the time to vote by signing, dating and mailing the enclosed proxy, which
is solicited on behalf of the Corporation's Board of Directors. The proxy will
not be used if you attend and vote at the annual meeting in person. REGARDLESS
OF THE NUMBER OF SHARES YOU OWN, YOUR VOTE IS VERY IMPORTANT. PLEASE ACT TODAY.
By Order of the Board of Directors,
/s/ David A. Widlak
-------------------------------------
David A. Widlak
President and Chief Executive Officer
Dated: March 21, 2006
COMMUNITY CENTRAL BANK CORPORATION
120 NORTH MAIN STREET
MOUNT CLEMENS, MI 48043
PROXY STATEMENT
This proxy statement is furnished to stockholders of Community Central Bank
Corporation in connection with the solicitation of proxies by its Board of
Directors for use at the Corporation's annual meeting of stockholders and at any
and all adjournments or postponements of the meeting. The annual meeting of
stockholders is being held on Tuesday, April 18, 2006, at 9:00 a.m., at the Best
Western Concorde Inn, 44315 Gratiot Avenue, Clinton Township, Michigan. These
proxy materials are first being mailed to our stockholders on or about March 21,
2006. Community Central Bank Corporation is referred to as the "Corporation"
throughout this document. Certain of the information provided herein relates to
Community Central Bank, a wholly owned subsidiary of the Corporation, which is
referred to in this proxy statement as the "Bank."
The Board of Directors, in accordance with the bylaws of the Corporation,
has fixed the close of business on February 27, 2006, as the record date for
determining the stockholders entitled to notice of and to vote at the annual
meeting and at any and all adjournments and postponements of the meeting. At the
close of business on the record date, the Corporation had 3,653,736 shares of
common stock outstanding, with each outstanding share entitled to one vote. A
majority of the outstanding shares will constitute a quorum at the meeting.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its exercise. Unless the proxy is revoked, the
shares represented by it will be voted at the annual meeting or any adjournment
of the meeting. You may revoke your proxy before it is voted at the annual
meeting by (i) submitting a new proxy with a later date; (ii) notifying the
Corporation's Secretary at the above address that you revoke your previously
submitted proxy; or (iii) voting in person at the annual meeting.
The entire cost of soliciting proxies will be borne by the Corporation.
Proxies may be solicited by mail or by directors, officers, or regular employees
of the Corporation or its subsidiary, in person, by telephone or by other forms
of communication. In addition to the solicitation of proxies by mail, Georgeson
Shareholder, a proxy solicitation firm, will assist the Corporation in
soliciting proxies for the annual meeting for a fee of $4,500, plus out of
pocket expenses. The Corporation will reimburse brokerage houses and other
custodians, nominees and fiduciaries for their out-of-pocket expenses for
forwarding soliciting material to the beneficial owners of common stock of the
Corporation.
Shares held in "street name" by a broker, bank or other nominee, as the
record holder of the shares, are required to be voted in accordance with
instructions from the beneficial owner of the shares. If no instructions are
provided to the nominee, the nominee will be entitled to vote the shares with
respect to "discretionary" items but will not be permitted to vote the shares
with respect to "non-discretionary" items. In the case of non-discretionary
items, the shares will be treated as "broker non-votes." The election of
directors is considered a "discretionary" item and, therefore, the broker bank
or other nominee may vote shares without instructions from the beneficial owner.
THE CORPORATION'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE
"FOR" THE ELECTION OF MANAGEMENT'S DIRECTOR NOMINEES AND "FOR" THE AMENDMENT TO
THE 2002 INCENTIVE PLAN TO INCREASE SHARES OF COMMON STOCK AVAILABLE FOR AWARDS
BY 100,000.
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
BENEFICIAL OWNERSHIP
The following table presents information regarding the beneficial ownership
of the Corporation's common stock as of February 27, 2006, the voting record
date for the annual meeting, by each of the directors and director nominees of
the Corporation, each of the executive officers named in the summary
compensation table on page 11, and all directors and executive officers of the
Corporation as a group. The address of each person named in the table, except
where otherwise indicated, is the same address as the Corporation. An asterisk
(*) in the table indicates that an individual beneficially owns less than one
percent of the outstanding common stock of the Corporation.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. In computing the number of shares
beneficially owned by a person and the percentage ownership of that person,
shares of common stock subject to outstanding options that are currently
exercisable or exercisable within 60 days after February 27, 2006, the voting
record date for the annual meeting, are included in the number of shares
beneficially owned by the person and are deemed outstanding for the purpose of
calculating the person's percentage ownership. These shares, however, are not
deemed outstanding for the purpose of computing the percentage ownership of any
other person. As of February 27, 2006, the Corporation had 3,653,736 shares of
common stock outstanding.
Amount and Nature
of Beneficial Percent of
Name of Beneficial Owner Ownership (1) Common Stock
------------------------ ----------------- ------------
Gebran S. Anton, Director............................. 202,340 5.5%
David E. Bonior, Director............................. 5,023 *
Joseph Catenacci, Director Nominee.................... 144,919 4.0%
Salvatore Cottone, Director........................... 174,072 4.7%
Celestina Giles, Director Nominee..................... 24,099 *
Bobby L. Hill, Director............................... 29,616 *
Joseph F. Jeannette, Director......................... 149,331 4.1%
Dean S. Petitpren, Chairman of the Board.............. 211,984 5.8%
Ronald R. Reed, Vice Chairman of the Board............ 78,675 2.1%
John W. Stroh, III, Director.......................... 13,922 *
David A. Widlak, President, CEO and Director Nominee.. 100,923 2.7%
Ray T. Colonius, Treasurer and CFO.................... 59,968 1.6%
All directors and executive officers of the
Corporation as a group (12 persons)................ 1,194,872 31.3%
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(1) Includes shares of Corporation common stock held directly, as well as
shares held jointly with family members, shares held in retirement
accounts, held in a fiduciary capacity, held by certain of the group
members' families, or held by trusts of which the group member is a trustee
or substantial beneficiary, with respect to which shares of common stock
the group member may be deemed to have sole or shared voting and/or
investment powers. Also includes shares of common stock as to which the
named individual has the right to acquire beneficial ownership, currently
or within 60 days after February 27, 2006, pursuant to the exercise of
stock options: Mr. Bonior - 1,213 shares; Mr. Catenacci - 4,851 shares; Mr.
Hill - 1,213 shares; Mr. Jeannette - 4,851 shares; Mr. Reed - 61,212
shares; Mr. Widlak - 43,448 shares; Mr. Colonius - 49,065 shares; and all
directors and executive officers as a group - 165,853 shares.
2
The table below shows the beneficial ownership of the Corporation's common
stock held by each person who was known by the Corporation to own beneficially
more than 5% of the Corporation's common stock as of February 27, 2006 and not
otherwise reported in the table above. To the best of the Corporation's
knowledge, no other person owns more than 5% of the Corporation's outstanding
common stock.
Name and Address Amount and Nature of Percent of
of Beneficial Owner Beneficial Ownership Common Stock
------------------- -------------------- ------------
Tontine Financial Partners, L.P. 240,080(1) 6.6%
Tontine Management, L.L.C.
Jeffrey L. Gendell
55 Railroad Avenue, 3rd Floor
Greenwich, CT 06830
----------
(1) Based on information in a Schedule 13D, dated November 12, 2004, filed by
Tontine Financial Partners, L.P. ("TFP"), a Delaware limited partnership,
Tontine Management, L.L.C. ("TM"), a Delaware limited liability company
which is the general partner of TFP, and Jeffrey L. Gendell, who is the
managing partner of TM. TFP, TM and Mr. Gendell have reported shared voting
and shared dispositive power over all of the reported shares. The shares
reflected in the above table have been adjusted by the Corporation for the
issuance of the 5% stock dividend.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely on our review of copies of reports filed pursuant to Section
16(a) of the Securities Exchange Act of 1934, as amended, or written
representations from persons required to file such reports, we believe that all
filings required to be made were timely made in accordance with the requirements
of the Securities Exchange Act of 1934.
ELECTION OF DIRECTORS
GENERAL
The Corporation's articles of incorporation provide that the number of
directors, as determined from time to time by the Board of Directors, shall be
no less than six and no more than 15. The articles of incorporation further
provide that the directors shall be divided into three classes, Class I, Class
II and Class III, with each class serving a staggered three-year term and with
the number of directors in each class being as nearly equal as possible. Our
Board of Directors currently consists of eleven members, with approximately
one-third of the directors being elected annually.
The Board of Directors, based on the recommendation of the nominating
committee, has nominated Joseph Catenacci, Celestina Giles and David A. Widlak,
as Class I directors, each for a three-year term expiring at the Corporation's
2009 annual meeting of stockholders, and upon election and qualification of
their successors. Each of the nominees is presently a Class I director of the
Corporation whose term expires at the April 18, 2006 annual meeting of
stockholders. The affirmative vote of a plurality of the votes cast is required
for the nominees to be elected. This means that the nominees with the most
affirmative votes are elected to fill the available seats. Accordingly, votes
withheld have no effect on the election of directors. THE CORPORATION'S BOARD OF
DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE ELECTION OF
MANAGEMENT'S DIRECTOR NOMINEES.
3
The other members of the Board, who are Class II and Class III directors,
will continue in office in accordance with their previous elections until the
expiration of their terms at the Corporation's 2007 or 2008 annual meetings of
stockholders, respectively. See "Information About Directors and Nominees as
Directors" below.
It is the intention of the persons named in the enclosed proxy to vote the
proxy for the election of the three nominees. The proposed nominees for election
as directors are willing to be elected and serve; however, in the event that any
nominee at the time of election is unable to serve or is otherwise unavailable
for election, the Board of Directors may select a substitute nominee, and in
that event the persons named in the enclosed proxy intend to vote the proxy for
the person so selected. If a substitute nominee is not selected, the proxy will
be voted for the election of the remaining nominees.
4
INFORMATION ABOUT DIRECTORS AND NOMINEES AS DIRECTORS
The following table presents certain information about the director
nominees and continuing directors of the Corporation. All of the directors
listed are also directors of the Bank. Each of the directors has held the
principal occupation listed in the table below for at least the past five years,
except as specifically indicated otherwise.
Has Served
as a Director Year When Term
Name, Age, Principal Occupation Since of Office Expires
------------------------------- ------------- -----------------
NOMINEES
Joseph Catenacci, 70................................................... 1996 2009
Chief Operating Officer; John Carlo, Inc. (Highway and Heavy
Construction)
Celestina Giles, 59.................................................... 2006 2009
Retired Executive Secretary
David A. Widlak, 57.................................................... 1999 2009
President and CEO of the Corporation
DIRECTORS REMAINING IN OFFICE
Gebran S. Anton, 73.................................................... 1996 2008
Co-owner; Anton, Zorn & Associates (Commercial & Industrial
Real Estate Brokerage)
Sole member; Anton Management Group, LLC. (Real Estate Management)
David E. Bonior, 61.................................................... 2003 2008
Retired U.S. Congressman; U.S. Government, 1977 - 2003
Professor of Labor Studies; Wayne State University, 2003 - present
Salvatore Cottone, 66.................................................. 1996 2007
President; Resco, Inc. (Real Estate Development)
Chairman of the Board of the Bank
Bobby L. Hill, 73...................................................... 1996 2007
County Commissioner; Macomb County Board of Commissioners
Joseph F. Jeannette, 61................................................ 1996 2008
Retired Assistant Director; Utica Community Schools
Dean S. Petitpren, 63.................................................. 1996 2007
President; Petitpren, Inc. (Beer Distribution)
Chairman of the Board of the Corporation
Ronald R. Reed, 59..................................................... 2000 2007
President and CEO of the Bank
Vice Chairman of the Corporation
John W. Stroh, III, 47................................................. 2005 2008
Chairman/CEO; The Stroh Companies (Investments)
5
BOARD MEETINGS, BOARD COMMITTEES
AND CORPORATE GOVERNANCE MATTERS
Attendance at Board, Committee and Annual Stockholders' Meetings. The
Corporation's Board of Directors conducted 10 meetings during fiscal 2005. The
Board of Directors of the Bank, the Corporation's principal operating
subsidiary, conducted 10 meetings during fiscal 2005. Each director attended at
least 75% of the (i) Corporation's Board meetings and any committees on which he
or she served and (ii) Bank's Board meetings and any committees on which he or
she served. In addition, all of our Board members are expected to attend the
Corporation's annual meeting of stockholders, although the Corporation does not
have any written policy as to Board members' attendance at the annual meeting of
stockholders. Last year's annual meeting of stockholders was attended by the
entire Board of Directors.
"Independent" Directors. The Board of Directors has determined that
directors David E. Bonior, Joseph E. Catenacci, Salvatore Cottone, Celestina
Giles, Bobby L. Hill, Joseph F. Jeannette and John W. Stroh, III, consisting of
a majority of the Board members, qualify as "independent" in accordance with the
published listing requirements of the Nasdaq rules. The Nasdaq independent
definition includes a series of objective tests, such as that the director is
not an employee of the corporation and has not engaged in various types of
business dealings with the corporation. As further required by the Nasdaq rules,
the Board has made a subjective determination as to each independent director
that no relationships exist which, in the opinion of the Board, would interfere
with the exercise of his or her independent judgment in carrying out the
responsibilities of a director. In making these determinations, the directors
reviewed and discussed information provided by the directors and the Corporation
with regard to each director's business and personal activities as they may
relate to the Corporation and its management.
In addition, as required by the Nasdaq rules, the members of the Audit
Committee each qualify as "independent" under standards established by the U.S.
Securities and Exchange Commission (the "SEC") for members of audit committees.
The Audit Committee also includes at least one independent member who the Board
has determined meets the qualifications of an "audit committee financial expert"
in accordance with SEC rules, including that the person meets the relevant
definition of an "independent director." Mr. Cottone is the independent director
who has been determined to be an audit committee financial expert.
Board Committees and Charter. The Board of Directors of the Corporation has
standing Executive, Audit, Compensation and Nominating Committees. The Board of
Directors has adopted a written charter for the compensation, audit and
nominating committees, as well as a written code of business conduct and ethics
that applies to all of our directors, officers and employees. You may obtain a
copy of these documents free of charge by writing to our Corporate Secretary at
Community Central Bank Corporation, 120 North Main Street, Mount Clemens,
Michigan 48043, or by calling (586) 783-4500. In addition, our code of business
conduct and ethics has been filed with the SEC as Exhibit 14 to the
Corporation's Annual Report on Form 10-KSB for the year ended December 31, 2003.
Our Audit Committee and Nominating Committee charters were attached to our proxy
statement as Appendices A and B, respectively, for the annual meeting of
stockholders held on April 20, 2004 and filed electronically with the SEC.
The Audit, Compensation and Nominating Committee members consist of solely
independent directors (as that term is defined in the Nasdaq rules), except for
the appointment of Mr. Gebran S. Anton to the Nominating Committee and Mr. Dean
S. Petitpren to the Compensation Committee. During 2003, the Bank purchased the
building serving as the main office of the Corporation and the Bank from a
company owned by Mr. Anton and Mr. Petitpren, thus disqualifying them as
independent directors under the Nasdaq rules. In connection with Mr. Anton's
appointment to the Nominating Committee, the Board, relying on an exception
under the Nasdaq rules, determined that it was in the best interests of the
6
Corporation and its stockholders to have Mr. Anton serve as a member of the
Nominating Committee because of his experience and in light of the lack of any
continuing conflict of interest. In connection with Mr. Petitpren's appointment
to the Compensation Committee, the Board, relying on an exception under the
Nasdaq rules, determined that it was in the best interests of the Corporation
and its stockholders to have Mr. Petitpren serve as a member of the Compensation
Committee because of his experience and in light of the lack of any continuing
conflict of interest.
Executive Committee. The Executive Committee is currently comprised of
Directors Cottone, Petitpren, Reed and Widlak (Chairman). The Executive
Committee met one time during 2005. The Executive Committee shall have and may
exercise the full powers and authority of the Board of Directors in the
management of the business affairs and property of the corporation during the
intervals between meetings of the Board of Directors. The Executive Committee
shall also have the power and authority to declare distributions and dividends
and to authorize the issuance of stock to the extent permitted by Michigan law.
Audit Committee. The Audit Committee is currently comprised of Directors
Cottone (Chairman), Bonior, Hill, Jeannette and Stroh, III, each of whom meets
the independence and financial literary requirements in the Nasdaq rules. The
Audit Committee met four times during fiscal 2005. The Audit Committee's
responsibilities include hiring, terminating or reappointing the Corporation's
independent auditors, reviewing the scope of proposed audits and the procedures
to be used, and the results of the audits, reviewing the adequacy and
effectiveness of accounting and financial controls, and reviewing the entire
internal and independent auditing function and the financial statements of the
Corporation. The Audit Committee also approves non-audit and audit services to
be performed by the independent auditors, reviews and approves all related party
transactions for potential conflict of interest situations, and reviews and
assesses the adequacy of the Audit Committee charter on an annual basis.
Compensation Committee. The Compensation Committee is currently comprised
of Directors Bonior, Catenacci, Jeannette and Petitpren (Chairman). The
Compensation Committee met two times during fiscal 2005. The Compensation
Committee reviews overall compensation policies for the Corporation and the
Bank. The Compensation Committee's responsibilities include determining
compensation and benefits for officers of the Corporation, based on
recommendations of Chief Executive Officer, David A. Widlak, who is not present
during voting or deliberations concerning his compensation. The Compensation
Committee is also responsible for administering the option plans and benefit
plans of the Corporation.
Nominating Committee. The Nominating Committee is currently comprised of
Directors Anton (Chairman), Bonior, Jeannette and Cottone. The Nominating
Committee met one time during fiscal 2005. The Nominating Committee is
responsible for reviewing and making recommendations to the Board of Directors
as to its size and composition and recommending to the Board of Directors
candidates for election as directors at the annual meetings, and filling any
vacancies that may occur between annual meetings. The Nominating Committee will
consider as potential nominees persons recommended by stockholders.
Recommendations should be submitted to the Nominating Committee in care of Lisa
M. Medlock, Secretary of the Corporation. Each recommendation should include a
personal biography of the suggested nominee, an indication of the background or
experience that qualifies such person for consideration, and a statement that
such person has agreed to serve if nominated and elected. Stockholders who
themselves wish to nominate a person for election to the Board of Directors, as
contrasted with recommending a potential nominee to the Board for its
consideration, are required to comply with the advance notice and other
requirements detailed in the Corporation's articles of incorporation. The
Nominating Committee has the following responsibilities:
7
(i) recommend to the Board the appropriate size of the Board and assist in
identifying, interviewing and recruiting candidates for the Board;
(ii) recommend candidates (including incumbents) for election and
appointment to the Board of Directors, subject to the provisions set
forth in the Corporation's articles of incorporation and bylaws
relating to the nomination or appointment of directors, based on the
following criteria: business experience, education, integrity and
reputation, independence, conflicts of interest, diversity, age,
number of other directorships and commitments (including charitable
obligations), tenure on the Board, attendance at Board and committee
meetings, stock ownership, specialized knowledge (such as an
understanding of banking, accounting, marketing, finance, regulation
and public policy) and a commitment to the Corporation's communities
and shared values, as well as overall experience in the context of the
needs of the Board as a whole;
(iii) review nominations submitted by stockholders, which have been
addressed to the Corporation's Secretary, and which comply with the
requirements of the Corporation's articles of incorporation and
bylaws. Nominations from stockholders will be considered and evaluated
using the same criteria as all other nominations;
(iv) annually recommend to the Board committee assignments and committee
chairs on all committees of the Board, and recommend committee members
to fill vacancies on committees as necessary; and
(v) perform any other duties or responsibilities expressly delegated to
the Committee by the Board.
Communications with the Board of Directors. Stockholders may communicate
directly with the Board of Directors, or any individual Board member, by sending
written communications to the Corporation, addressed to the Chairman of the
Board or such individual Board member.
DIRECTOR COMPENSATION
During 2005, each member of the Board of Directors received a monthly
retainer of $2,000, in the aggregate, for services as a director of the
Corporation and the Bank. Non-employee directors of the Corporation and the Bank
also received compensation for their services as committee members. Non-employee
directors of the Executive, Audit, Compensation and Nominating Committees of the
Corporation and the Bank each received $500 per meeting attended, except for the
Chairman of the Audit Committee who received $2,000 per month, the Chairman of
the Compensation Committee who received $500 per month and the Chairman of the
Nominating Committee who received $1,000 per meeting attended during 2005.
Non-employee directors serving on the Bank's Loan and Asset/Liability
Committees each received $50 per meeting attended, except for the chairmen of
such committees who each received $100 per meeting attended. Director Hill
received $1,000 a month for serving as Chairman of the Board of Community
Central Mortgage Company, LLC, the Corporation's mortgage company subsidiary and
directors Cottone, Reed and Widlak each received $500 a month for serving as
advisory board members to the mortgage company.
8
Under the Corporation's 2002 Incentive Plan, which was approved by the
stockholders at the Corporation's annual meeting held in April 2002, each
director is awarded 300 shares of common stock of the Corporation annually. The
awards are made each year, on the first business day of the month following the
annual meeting of stockholders, from 2002 through 2010, during the period that
the director serves on the Board.
9
REPORT OF THE AUDIT COMMITTEE
The following Audit Committee Report does not constitute soliciting
material and should not be deemed filed or incorporated by reference into any
other Corporation filing under the Securities Act of 1933 or the Securities
Exchange Act of 1934, except to the extent the Corporation specifically
incorporates this report by reference.
The members of the Audit Committee consist of Messrs. Bonior, Cottone,
Hill, Jeannette and Stroh, III.
Management has the primary responsibility for the financial statements and
the reporting process, including the Corporation's systems of internal controls.
In fulfilling its oversight responsibilities, the Audit Committee reviewed and
discussed the audited financial statements for the year ended December 31, 2005
with management, including a discussion of the quality and the acceptability of
the Corporation's financial reporting and controls.
The Audit Committee has also discussed with the Corporation's independent
auditors, Plante & Moran, PLLC, which firm is responsible for expressing an
opinion on the conformity of those audited financial statements with generally
accepted accounting principles, their judgments as to the quality and the
acceptability of the Corporation's financial reporting and such other matters as
are required to be discussed with the Audit Committee under generally accepted
auditing standards, including the matters required to be discussed pursuant to
Statement on Auditing Standards Nos. 61 and No. 90 (Communications with Audit
Committees). In addition, the Audit Committee has received written disclosures
and the letter from Plante & Moran, PLLC required by Independence Standards
Board Standard No. 1, Independence Discussions with Audit Committees, disclosing
the matters that, in the auditor's judgment, may reasonably be thought to bear
on the auditors' independence from the Corporation, and has discussed with
Plante & Moran, PLLC their independence from the Corporation. The Audit
Committee has also considered the compatibility of the providing of non-audit
services with maintaining the auditors' independence.
In fulfilling its oversight responsibility of reviewing the services
performed by the Corporation's independent auditors, the Audit Committee
carefully reviews the policies and procedures for the engagement of independent
auditors and the fees paid by the Corporation for such services. The Audit
Committee also discussed with the Corporation's internal and independent
auditors the overall scope and plans for their respective audits and the fees
paid by the Corporation for such services. The Audit Committee meets
periodically with the internal and independent auditors, with and without
management present, to discuss the results of their examinations, their
evaluations of the Corporation's internal controls, and the overall quality of
the Corporation's financial reporting.
The Corporation's Chief Executive Officer and Chief Financial Officer also
reviewed with the Audit Committee the certifications that each such officer will
file with the SEC pursuant to the requirements of Sections 302 and 906 of the
Sarbanes-Oxley Act of 2002 ("Sarbanes"). Management also reviewed with the Audit
Committee the policies and procedures it has adopted to ensure the accuracy of
such certifications.
10
In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in the Annual Report on Form 10-KSB for the year ended
December 31, 2005 for filing with the Securities and Exchange Commission.
Audit Committee
Salvatore Cottone
David E. Bonior
Bobby L. Hill
Joseph F. Jeannette
John W. Stroh, III
11
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE.
The following table sets forth summary information concerning compensation
awarded to, earned by or paid to the named executives for services rendered by
each of them in all capacities with the Corporation and the Bank. No other
executive officer received aggregate compensation, which includes salary and
bonus, exceeding $100,000, for services rendered in 2005. Each of the named
executives received perquisites and other personal benefits in addition to his
salary and bonus during the periods stated; however, the aggregate amount of
these perquisites and other personal benefits did not exceed the lesser of
$50,000 or 10% of his respective total annual salary and bonus and, therefore,
this information has been omitted as permitted by the rules of the SEC.
Annual Compensation Long Term
--------------------------- Compensation All Other
Name and Principal Position Year Salary (1) Bonus Options Compensation (2)
--------------------------- ---- ---------- ------- ------------ ----------------
David A. Widlak, 2005 $288,750 $80,000 10,000 $162,730
President and CEO of the 2004 279,000 31,250 12,000 152,984
Corporation 2003 175,255 47,500 7,000 31,473
Ronald R. Reed, 2005 $211,125 $50,000 5,000 $139,776
President and CEO of the 2004 204,000 22,500 6,000 127,727
Bank 2003 184,102 40,000 5,000 50,684
Ray T. Colonius, 2005 $139,500 $40,000 4,000 $ 35,837
CFO and Treasurer of the 2004 134,950 12,500 5,000 38,565
Corporation and Sr. VP and 2003 118,450 35,000 3,000 15,775
CFO of the Bank
----------
(1) Includes director fees paid to Mr. Widlak and Mr. Reed for each of the
periods reported.
(2) The amounts shown in the table for 2005 reflect the Bank's contributions
made on behalf of the named executive under the Bank's 401(k) plan and the
Corporation's or Bank's accruals on behalf of the named executive under the
non-qualified supplemental executive retirement plans maintained by the
Corporation and the Bank, as follows:
401(k) Matching SERP
Name Contribution Accrual
---- --------------- --------
David A. Widlak $9,066 $153,664
Ronald R. Reed 7,192 132,584
Ray T. Colonius 5,594 30,243
12
OPTIONS GRANTED IN 2005
The following table provides information on options granted to the named
executive officers during the year ended December 31, 2005. No stock
appreciation rights have been granted by the Corporation.
Individual Grants
----------------------------------------------------------
% of Total
Number of Options
Shares Granted to Exercise or
Underlying Options Employees Base Price Expiration
Name Granted (1) in 2005 Per Share Date
---- ------------------ ---------- ----------- ----------
David A. Widlak 10,000 17% $13.21 12-01-2015
Ronald R. Reed 5,000 8% $13.21 12-01-2015
Ray T. Colonius 4,000 7% $13.21 12-01-2015
----------
(1) The option grants to Mr. Widlak, Mr. Reed and Mr. Colonius are immediately
exercisable.
AGGREGATED STOCK OPTION EXERCISES IN 2005 AND YEAR END OPTION VALUES
The following table sets forth the number and value of stock options
exercised in 2005 and unexercised stock options held by the named executive
officers at December 31, 2005. The dollar amounts under the "Value Realized"
column represent the difference between the fair market value of the underlying
stock on the exercise date and the exercise or base price of the option(s). The
dollar amounts under the "Value of Unexercised In-the-Money Options at
12-31-2005" column represent the difference between the exercise or base price
of the named executive officer's stock option(s) and $13.24, the average of the
closing high bid and low asked prices reported by the Nasdaq National Market as
of December 31, 2005. The amounts set forth in the column "Value of Unexercised
In-the-Money Options at 12-31-2005" have not been, and may never be, realized,
as these options have not been, and may not ever be, exercised. Actual gains, if
any, on exercise will depend on the value of the Corporation's common stock on
the date of exercise. Unexercisable options are those which have not yet vested.
No stock appreciation rights have been granted by the Corporation.
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
Shares 12-31-2005 12-31-2005
Acquired on Value Exercisable / Exercisable /
Name Exercise Realized Unexercisable Unexercisable
---- ----------- -------- ------------- ---------------
David A. Widlak 751 $ 4,879 43,448/4,200 $127,592/$3,948
Ronald R. Reed -- -- 61,212/ -- $342,720/$ --
Ray T. Colonius 2,000 $19,520 49,065/ -- $293,308/$ --
13
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
The Corporation, through the Community Central Bank Corporation
Supplemental Executive Retirement Plan (the "Corporation SERP"), and the Bank,
through the Community Central Bank Supplemental Executive Retirement Plan (the
"Bank SERP"), provide supplemental retirement benefits to a select group of
senior officers. Mr. Widlak is a participant in the Corporation SERP and Messrs.
Reed and Colonius are participants in the Bank SERP. Participants in the
Corporation SERP and Bank SERP vest 10 percent a year for each year of credited
service in his retirement benefits under the SERP. As of December 31, 2005,
Messrs. Widlak, Reed and Colonius were 40 percent, 53 percent and 60 percent
vested, respectively, in their retirement benefits.
The Corporation SERP and Bank SERP (collectively, the "SERPs") are designed
to provide monthly benefits over a 15-year period to each participant upon his
retirement. The benefit payable upon retirement is a function of years of
service earned after December 31, 1999. The minimum annual benefit is $75,000
and the maximum annual benefit is 50% of the average of the three highest years
of compensation. Generally, reduced early retirement benefit payments under the
SERP can commence upon the later of the date of the termination of the
participant's employment or age 62; otherwise, benefit payments generally will
commence at age 65. If a participant is terminated for cause he is not entitled
to any benefits under the SERP. If Messrs. Widlak, Reed and Colonius retired as
of December 31, 2005, upon reaching age 65 they would be entitled to receive a
monthly benefit under the SERPs of $5,010, $5,272, and $4,003, respectively, for
the next 15 years.
If a participant dies before receiving any retirement benefits under the
SERP, his designated beneficiary will receive a discounted lump sum payment of
the participant's retirement benefits. If a participant dies after he or she has
begun to receive retirement benefits under the SERP, the remaining payments will
continue to be made to the participant's designated beneficiary for the rest of
the payout period, or the committee administering the SERP may accelerate the
payment of the remaining retirement benefits at such time in a discounted lump
sum payment and in such manner as the committee may determine.
The SERP is an unfunded plan. The Bank has obtained life insurance policies
on the lives of the participants in the SERP as a means of offsetting the costs
of providing the benefits under the SERP.
14
CERTAIN TRANSACTIONS
The Bank has had, and expects to have in the future, loans and other
banking related transactions in the ordinary course of business with the
Corporation's directors, executive officers, and principal stockholders and
their associates. All such transactions (i) are made in the ordinary course of
business, (ii) are made on substantially the same terms, including interest
rates and collateral on loans, as those prevailing at the time for comparable
transactions with other persons, and (iii) in the opinion of management, do not
involve more than the normal risk of collectibility, or present other
unfavorable features. All loans made by the Bank to its directors and officers
are subject to federal banking regulations restricting loan and other
transactions with affiliated persons of the Bank. As of December 31, 2005, the
Bank had outstanding 43 loans to the directors and executive officers of the
Corporation, totaling approximately $8.0 million in the aggregate, with an
additional $3.3 million under commitments. All outstanding loans to directors
and executive officers were performing in accordance with their terms at
December 31, 2005.
15
SELECTION OF AND RELATIONSHIP WITH INDEPENDENT AUDITOR
The Audit Committee of the Board of Directors has appointed Plante & Moran,
PLLC as the Corporation's principal independent auditor for the year ending
December 31, 2006. In making its determination to appoint Plante & Moran, PLLC
as the Corporation's independent auditors for the 2006 fiscal year, the Audit
Committee considered the non-audit services that the independent auditors
provided during the 2005 fiscal year and determined that the provision of these
services is compatible with and does not impair the auditors' independence.
Representatives of Plante & Moran, PLLC plan to attend the annual meeting of
stockholders, will have the opportunity to make a statement if they desire to do
so, and will respond to appropriate questions by stockholders. The Audit
Committee, in its discretion, may direct the appointment of a different
independent accounting firm at any time during the year, if it determines that
such a change would be in the best interest of the Corporation and its
stockholders.
INDEPENDENT AUDITING FIRM FEES
Plante & Moran, PLLC was the Corporation's principal auditor for fiscal
2004 and 2005. The aggregate fees billed to the Corporation by Plante & Moran,
PLLC and its affiliates for the fiscal years ended December 31, 2005 and 2004
were as follows:
Year Ended December 31,
-----------------------
2005 2004
-------- --------
Audit Fees............. $110,500 $100,225
Audit Related Fees(1).. 7,225 4,450
Tax Fees (2)........... 5,525 6,900
All Other Fees (3)..... 8,250 --
-------- --------
Total............... $131,500 $111,575
======== ========
----------
(1) Primarily for services related to research on accounting issues during 2004
and 2005. In addition, 2004 included services rendered in connection with
the enactment of new Sarbanes requirements and an acquisition.
(2) Primarily for tax compliance, tax advice, tax return preparation services
and correspondence with the IRS. The fees reported for both years also
include tax consulting related services in connection with director
retirement.
(3) Primarily for Sarbanes-Oxley 404 facilitation which was separately approved
by the Audit Committee of the Corporation.
PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES
In compliance with Sarbanes, our Audit Committee pre-approves all audit and
permissible non-audit services provided by our independent auditors. These
services may include audit services, audit-related services, tax services and
other services. Prior to engaging our independent auditors to render an audit or
permissible non-audit service, the Audit Committee specifically approves the
engagement to render that service. Accordingly, we do not engage our independent
auditors to render audit or permissible non-audit services pursuant to
pre-approval policies or procedures or otherwise, unless the engagement to
provide such services has been approved by the Audit Committee in advance. The
engagement of Plante & Moran, PLLC to render 100 percent of the services
described in the categories above was approved by the Audit Committee in advance
of the rendering of those services.
16
EQUITY COMPENSATION PLAN INFORMATION
The following table provides information as of December 31, 2005 with
respect to the shares of Corporation's common stock that may be issued under our
existing equity compensation plans and arrangements, which include the
Corporation's 1996 Employee Stock Option Plan, 1999 Stock Option Plan for
Directors, 2000 Employee Stock Option Plan and 2002 Incentive Plan, as amended.
Each of these plans has been approved by the Corporation's stockholders and
filed with the SEC. The table does not include the 100,000 shares subject to the
amendment to the 2002 Incentive Plan, as amended, being submitted for approval
by the Corporation's stockholders at the annual meeting. All amounts in the
table have been adjusted for the two 5% stock dividends paid by the Corporation
to its stockholders in 2005 and 2004.
Number of securities
remaining available for
future issuance under
Number of securities to be Weighted-average exercise equity compensation
issued upon exercise of price of outstanding plans. (excluding
outstanding Option, options, warrants and securities reflected in
warrants and rights. rights. column (a)).
Plan Category (a) (b) (c)
------------- -------------------------- ------------------------- -----------------------
Equity Compensation plans 286,834(1) $9.44 61,851
approved by security holders
Equity compensation plans not None None None
approved by security holders
------- ----- ------
Total 286,834(1) $9.44 61,851
======= ===== ======
(1) Options to purchase 15,015 shares of the Corporation's common stock will
either be exercised or expire on or before December 31, 2006.
17
PROPOSED AMENDMENT TO
COMMUNITY CENTRAL BANK CORPORATION
2002 INCENTIVE PLAN
Stockholders are being requested to approve an amendment to the Community
Central Bank Corporation 2002 Incentive Plan (the "2002 Incentive Plan") to
increase by 100,000 the number of shares of the Corporation common stock for
which stock options and other stock-based incentives may be granted to employees
under the plan. The Board of Directors unanimously recommends approval of the
amendment to the 2002 Incentive Plan to allow the Corporation to continue to
attract and retain the best available officers and employees, and provide an
incentive for all award recipients under the Plan to use their best efforts on
the Corporation's behalf. If stockholders approve the amendment, the number of
shares of Corporation common stock for which awards to employees may be granted
will be increased by 100,000 shares, representing approximately 2.7% of the
outstanding shares of common stock of the Corporation as of the date of this
proxy statement. As a result of such approval, the aggregate number of shares of
common stock for which awards may be granted under the 2002 Incentive Plan would
be increased from 61,851 shares to 161,851 shares. All share and exercise price
information, except where noted, has been adjusted to reflect the two 5% stock
dividends paid by the Corporation to its stockholders in 2005 and 2004.
The Corporation's Board of Directors adopted the 2002 Incentive Plan on
February 19, 2002. The Plan became effective when it was approved by the
Corporation's stockholders at the annual meeting on April 16, 2002 and as
amended April 20, 2004. As of February 27, 2006, awards for 194,795 (less any
forfeitures) have been granted under the 2002 Incentive Plan, as amended, which
includes options granted to employees to purchase 181,376 shares of common
stock, at exercise prices ranging from $7.71 to $14.50 per share, and stock
awards granted to directors of 13,419 shares pursuant to the formula award under
the plan. This leaves only 61,851 shares of common stock available for future
awards under the 2002 Incentive Plan, of which not more than 30,681 shares are
available for award to directors. On February 17, 2004, the Board of Directors,
acting on the recommendation of the Corporation's Compensation Committee,
unanimously adopted this amendment to the 2002 Incentive Plan to increase the
shares available for awards to employees under the plan by 100,000, subject to
the approval of the Corporation's stockholders.
The principal provisions of the 2002 Incentive Plan, as amended, are
summarized below. This summary does not, however, purport to be complete and is
qualified in its entirety by the terms of the plan. The full text of the plan,
as amended by amendment numbers one and two to the plan, are set forth in
Appendix A to this proxy statement.
DESCRIPTION OF THE PLAN
General. The purpose of the 2002 Incentive Plan is to promote the growth
and profitability of the Corporation, to provide certain key officers, employees
and directors of the Corporation and its affiliates with an incentive to achieve
corporate objectives, to attract and retain individuals of outstanding
competence and to provide such individuals with an equity interest in the
Corporation. Options granted under the Stock Option Plan may be either
"incentive stock options," as defined by Section 422 of the Internal Revenue
Code, or non-statutory stock options.
Administration. The Compensation Committee or such other committee the
Board of Directors may designate is responsible for the administration of the
2002 Incentive Plan. That committee determines, within the limitations of the
2002 Incentive Plan, the directors, officers and employees to whom awards are
granted. Subject to certain specific limitations and restrictions set forth in
the 2002 Incentive Plan and limitations as may be imposed from time to time by
the Board of Directors, the
18
committee has authority to interpret the plan, to prescribe, amend and rescind
rules and regulations, if any, relating to the plan and to make all
determinations necessary or advisable for the administration of the plan. The
committee may delegate its duties under the plan to the Chairman of the Board,
President or other senior officer of the Corporation, except that no such
delegation may be made with respect to actions involving persons participating
in the plan who are subject to Section 16 of the Securities Exchange Act of 1934
or are "covered employees under Section 162(m) of the Internal Revenue Code. The
costs and expenses of administering the plan are borne by the Corporation.
Eligibility. Every director, officer and employee of the Corporation and
its affiliates is entitled to participate in the 2002 Incentive Plan. As of the
date of this proxy statement, a total of 151 persons were eligible to receive
awards under the plan, which includes 140 employees and the eleven directors who
receive automatic awards of 300 shares of common stock per year. Incentive stock
options may only be granted to employees of the Corporation and its affiliates.
Non-statutory stock options may be granted to any eligible participant under the
plan.
Shares Subject to the Plan. The Corporation initially reserved and
stockholders approved for reservation 130,000 shares of common stock for awards
under the plan, of which 40,000 shares were available for awards to directors.
The plan was amended on April 20, 2004 to add an additional 100,000 shares for
awards to employees. In any one calendar year, no individual may receive awards
under the Plan consisting of options or SARs that are exercisable for more than
20,000 shares or awards consisting of common stock or units denominated in
common stock covering more than 15,000 shares, or a cash award in excess of
$200,000. The Plan provides that the number of shares reserved for issuance
under the Plan, as well as the awards to be made under the Plan, and the stock
based limits on awards, will be adjusted proportionally by the Board to reflect
any stock dividends or splits, or other subdivisions or consolidations of the
common stock of the Corporation. The shares set forth in this paragraph do not
reflect any adjustments for the prior 5% stock dividends.
If stockholders approve the amendment, 161,851 shares (as adjusted for
prior stock dividends) of common stock will be available for awards under the
2002 Incentive Plan, of which not more than 30,681 shares (as adjusted for prior
stock dividends) will be available for stock awards to directors.
Employee Awards. The following types of awards may be made to employees
under the Plan:
Stock Options. The committee may grant either incentive stock options
or nonqualified stock options. The committee sets option exercise prices
and terms. Regardless of option type, however, the exercise price of an
option may not be less than the fair market value of the Corporation's
common stock on the date of grant. The fair market value of the common
stock on February 22, 2006 was $12.00 per share.
SARs. SARs are rights to receive a payment, in cash or common stock of
the Corporation, equal to the excess of the fair market value or other
specified valuation of a specified number of shares of common stock of the
Corporation on the date the rights are exercised over a specified strike
price. The committee may grant SARs either singly or in combination with an
underlying stock option under the Plan. The terms of a SAR are established
by the committee.
Stock Awards. The committee may grant awards of common stock of the
Corporation or denominated units of common stock. The terms of any Stock
Awards are established by the committee. The committee may decide to
include dividends or dividend equivalents as part of an award.
19
Cash Awards. Cash Awards consist of grants denominated in cash. The
terms of any Cash Awards are established by the committee.
Performance Awards. The committee may elect to grant any of the
employee awards in the form of a Performance Award under which the grant
may be subject to the attainment of one or more performance goals. A
Performance Award is paid, vested or otherwise deliverable solely upon the
attainment of one or more pre-established, objective performance goals
established by the committee. A performance goal may be based upon one or
more business criteria that apply to the employee, one or more business
units of the Corporation or a subsidiary or the Corporation as a whole,
including the following: revenue, net income, stock price, stockholder
return, earnings per share, market performance, return on equity, return on
assets or new business contract values. A performance goal is established
by the committee prior to the earlier of (a) 90 days after the start of the
period of service to which the goal relates and (b) the lapse of 25% of the
period of service, but in any event while the outcome is substantially
uncertain.
Annual Stock Awards to Directors. Under the terms of the plan, each
director receives an annual award of 300 shares of common stock of the
Corporation. This award is made automatically to each director on the first
business day of the month following the annual meeting of stockholders, during
the period that the director serves on the Board of Directors of the
Corporation, through 2010. No other awards are available to non-employee
directors.
Termination or Amendment of the Plan. The Board may amend, modify, suspend
or terminate the plan for the purpose of addressing any changes in legal
requirements or for any other purpose permitted by law, except that no amendment
that would impair the rights of any participant with respect to any award may be
made without the consent of the participant.
Transfers. No award or any other benefit under the plan is transferable
except by will or the laws of descent and distribution or pursuant to a
qualified domestic relations order, provided that the committee may authorize
all or a portion of any nonqualified stock option granted to a participant to be
transferable for no consideration to certain immediate family members, a trust
solely for the benefit of the participant or such immediate family members, or a
partnership or limited liability company in which the only partners are the
participant or such immediate family members or trusts.
FEDERAL INCOME TAX CONSEQUENCES
The federal income tax consequences to the Corporation and its employees of
awards under the 2002 Incentive Plan are complex and subject to change. The
following discussion, which has been prepared by counsel to the Corporation, is
only a summary of the general federal tax rules applicable to the 2002 Incentive
Plan. This summary is not complete and does not address state and local tax
treatment of awards under the plan. Recipients of awards under the plan should
consult their own tax advisors since a taxpayer's particular situation may be
such that some variation of the rules described below will apply.
As discussed above, different types of awards may be issued under the 2002
Incentive Plan. The tax consequences related to the issuance of each is
discussed separately below.
Stock Options. As noted above, options granted under the 2002 Incentive
Plan may be either incentive stock options or non-statutory stock options.
Incentive stock options are options that are designated as such by the
Corporation and that meet certain requirements under Section 422 of the Internal
Revenue Code and the regulations thereunder. Any option that does not satisfy
these requirements will be treated as a non-statutory stock option.
20
Incentive Stock Options. If an option is an incentive stock option, the
optionee will not recognize any income upon either the grant or the exercise of
the option, and the Corporation will not be allowed a deduction for federal tax
purposes. Upon a sale of the shares, the tax treatment to the optionee and the
Corporation will depend primarily upon whether the optionee has met certain
holding period requirements at the time he or she sells the shares. If the
common stock purchased upon the exercise of an incentive stock option is held
for at least two years from the date of the award of the option and for at least
one year after the exercise of the option, any resulting gain is taxed at
long-term capital gains rates. If that common stock is disposed of before the
expiration of that holding period (a "disqualifying disposition"), any gain on
the disposition, up to the difference between the fair market value of the
common stock at the time of exercise and the exercise price, is taxed at
ordinary rates as compensation paid to the employee, and the Corporation is
entitled to a deduction for an equivalent amount. Any amount realized by the
employee upon a disqualifying disposition in excess of the fair market value of
the common stock at the time of exercise is taxed at capital gain rates.
The exercise of an incentive stock option may subject an optionee to
alternative minimum tax liability. The excess of the fair market value of the
shares at the time an incentive stock option is exercised over the purchase
price of the shares is included in income for purposes of the alternative
minimum tax, even though it is not included in taxable income for purposes of
determining the regular tax liability of an employee. Consequently, an optionee
may be obligated to pay alternative minimum tax in the year he or she exercises
an incentive stock option.
Non-Statutory Stock Options. Non-statutory stock options will not qualify
for any special tax benefits to the optionee. An optionee generally will not
recognize any taxable income at the time he or she is granted a non-statutory
stock option, and no deduction is available to the Corporation at such time.
However, upon exercise of a non-statutory stock option (other than delivery of
common stock to the Corporation), the optionee will recognize ordinary income
for federal tax purposes measured by the excess of the then fair market value of
the shares over the exercise price, and the Corporation will receive a tax
deduction for the same amount. If the non-statutory option is exercised by
delivering common stock to the Corporation, the number of shares of common stock
received by the optionee equal to the number of shares so delivered will be
received free of tax and will have the tax basis and holding period of the
delivered shares. The fair market value of additional common stock will be taxed
to the optionee as ordinary income, and the optionee's tax basis in such shares
will be the fair market value on the date of exercise. Upon disposition, any
appreciation or depreciation of the common stock after the date of exercise may
be treated as capital gain or loss. The income realized by the optionee will be
subject to income and other employee withholding taxes.
Restricted Stock. At the time a restricted stock award is granted a grantee
may elect to be taxed at ordinary income tax rates in the year the award is
granted based on the fair market value of the common stock as of the date of
grant. If the election is not exercised within the time prescribed under Section
83(b) of the Internal Revenue Code, the grantee will be taxed in the year the
restrictions expire based on the fair market value of the common stock as of the
date the restrictions expire. The Corporation is entitled to a corresponding
federal income tax deduction for the year in which the grantee is taxed at
ordinary income tax rates. If the grantee is taxed in the year the restrictions
expire, dividends paid to the grantee during the restriction period will be
taxed as additional compensation (ordinary income) and the Corporation will be
entitled to a corresponding deduction. If the grantee is taxed in the year in
which the award is granted, dividends paid to the optionee during the
restriction period with respect to the common stock will be treated as dividend
income, and the Corporation will not be entitled to a corresponding deduction.
SARs. The grant of a SAR would not result in income for the grantee or in a
deduction for the Corporation. Upon the exercise of a SAR, the grantee would
recognize ordinary income and the
21
Corporation would be entitled to a deduction measured by the fair market value
of the shares plus any cash received. Tax withholding would be required for
employees.
Cash Awards; Stock Awards. A grantee will recognize ordinary income upon
receipt of cash pursuant to a Cash Award or Performance Award. A grantee will
not have taxable income upon the grant of a Stock Award in the form of units
denominated in common stock of the Corporation, but rather will generally
recognize ordinary income at the time he or she receives common stock or cash in
satisfaction of such award in an amount equal to the fair market value of the
common stock or cash received. In general, a grantee will recognize ordinary
income as a result of the receipt of common stock pursuant to a Stock Award or
Performance Award in an amount equal to the fair market value of the common
stock when it is received, although if the stock is not transferable and is
subject to a substantial risk of forfeiture when received, the grantee will
recognize ordinary income in an amount equal to the fair market value of the
common stock when it first becomes transferable or is no longer subject to a
substantial risk of forfeiture. Tax withholding would be required for employees.
Section 162(m). Compensation of the named executive officers of the
Corporation in the Summary Compensation Table may be subject to the tax
deduction limits of section 162(m) of the Internal Revenue Code, which, subject
to certain exceptions, prevents the Corporation from deducting compensation paid
to those officers in excess of $1 million in any one year. Stock options, SARs,
and Cash Awards that qualify as "performance-based compensation" are excluded
from the deduction limits under section 162(m). If approved by the Corporation's
shareholders, the Plan will enable the Committee to grant stock options, SARs
and annual incentive bonuses (in the form of Cash Awards under the Plan) that
will be fully tax deductible by the Corporation.
NEW PLAN BENEFITS
At this time, no awards have been granted with respect to the additional
shares being requested pursuant to this amendment. Grants to eligible employees
and directors are subject to the discretion of the committee and, therefore, are
not determinable at this time.
VOTE REQUIRED AND BOARD RECOMMENDATION
The affirmative vote of a majority of the votes cast at the meeting by the
holders of shares entitled to vote is required to approve the amendment to the
2002 Incentive Plan. Shares as to which the "Abstain" box has been selected on
the proxy card for this amendment will be counted as present and entitled to
vote and, accordingly, will have the effect of a vote against the amendment.
Broker non-votes will not be counted as present and entitled to vote at the
annual meeting and will have no effect on the amendment. THE CORPORATION'S BOARD
OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE AMENDMENT TO THE
2002 INCENTIVE PLAN TO INCREASE SHARES OF COMMON STOCK AVAILABLE FOR AWARDS TO
EMPLOYEES BY 100,000.
22
STOCKHOLDER PROPOSALS FOR 2007 ANNUAL MEETING
Any proposal submitted by a stockholder for the 2007 annual meeting of
stockholders should be sent to Lisa Medlock, Corporate Secretary, at 120 North
Main Street, PO Box 7, Mount Clemens, MI 48046-0007. Proposals must be received
by November 20, 2006, in order to be eligible to be included in the
Corporation's proxy statement for that meeting. Stockholder proposals to be
considered for presentation at next year's annual meeting, although not included
in the proxy statement must be received at our executive office at least 10 days
prior to the date of the annual meeting.
All stockholder proposals for inclusion in the Corporation's proxy
materials shall be subject to the requirements of the proxy rules adopted under
the Securities Exchange Act of 1934, as amended, and, as with any shareholder
proposal (regardless of whether it is included in proxy materials), the
Corporation's articles of incorporation and bylaws and Michigan law.
OTHER MATTERS
The Board of Directors does not know of any other matters to be brought
before the annual meeting. If other matters are presented upon which a vote may
properly be taken, it is the intention of the persons named in the proxy to vote
the proxies in accordance with their best judgment.
23
APPENDIX A
COMMUNITY CENTRAL BANK CORPORATION
2002 INCENTIVE PLAN
(As amended April 20, 2004 and April 18, 2006)
1. Plan. This Incentive Plan of Community Central Bank Corporation (the
"Plan"), subject to approval by the shareholders of Community Central Bank
Corporation (the "Company"), shall be effective as of April 16, 2002 and was
amended April 20, 2004.
2. Objectives. This Plan is designed to attract and retain key employees of
the Company and its Subsidiaries (as hereinafter defined), to attract and retain
qualified directors of the Company, to encourage the sense of proprietorship of
such employees and Directors, and to stimulate the active interest of such
persons in the development and financial success of the Company and its
Subsidiaries. These objectives are to be accomplished by making Awards (as
hereinafter defined) under this Plan and thereby providing Participants (as
hereinafter defined) with a proprietary interest in the growth and performance
of the Company and its Subsidiaries. It is intended that neither the Plan nor
any Award issued hereunder shall be subject to Section 409A, and the Plan shall
be operated and interpreted accordingly.
3. Definitions. As used herein, the terms set forth below shall have the
following respective meanings:
"Annual Director Award Date" means, for each year, the first business day
of the month next succeeding the date upon which the annual meeting of
shareholders of the Company is held in such year.
"Authorized Officer" means the Chairman of the Board or the President of
the Company (or any other senior officer of the Company to whom the Committee
(as hereinafter defined) or the Chairman of the Board or President shall
delegate the authority to execute any Award Agreement).
"Award" means an Employee Award or a Director Award.
"Award Agreement" means any Employee Award Agreement or Director Award
Agreement.
"Board" means the Board of Directors of the Company.
"Cash Award" means an award denominated in cash.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Committee" means the Compensation Committee of the Board or such other
committee of the Board as is designated by the Board to administer the Plan.
"Common Stock" means the Common Stock, no par value, of the Company.
"Director" means an individual serving as a member of the Board.
"Director Award" means the grant of a Stock Award to a Director pursuant to
Section 9 hereof.
"Director Award Agreement" means a written agreement between the Company
and a Participant who is a Director setting forth the terms, conditions and
limitations applicable to a Director Award.
"Dividend Equivalents" means, with respect to shares of Restricted Stock
that are to be issued at the end of the Restriction Period, an amount equal to
all dividends and other distributions (or the economic equivalent thereof) which
are payable to shareholders of record during the Restriction Period on a like
number of shares of Common Stock.
"Employee" means an employee of the Company or any of its Subsidiaries.
"Employee Award" means the grant of any Option, SAR, Stock Award, Cash
Award or Performance Award, whether granted singly, in combination or in tandem,
to a Participant who is an Employee pursuant to such applicable terms,
conditions and limitations as the Committee may establish in order to fulfill
the objectives of the Plan.
"Employee Award Agreement" means a written agreement between the Company
and a Participant who is an Employee setting forth the terms, conditions and
limitations applicable to an Employee Award.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.
"Fair Market Value" of a share of Common Stock means, as of a particular
date, (i) if shares of Common Stock are listed on a national securities
exchange, the mean between the highest and lowest sales price per share of
Common Stock on the consolidated transaction reporting system for the principal
national securities exchange on which shares of Common Stock are listed on that
date, or, if there shall have been no such sale so reported on that date, on the
last preceding date on which such a sale was reported, (ii) if shares of Common
Stock are not so listed but are quoted on the Nasdaq Stock Market, the mean
between the highest and lowest sales price per share of Common Stock reported by
the Nasdaq Stock Market on that date, or, if there shall have been no such sale
so reported on that date, on the last preceding date on which such a sale was so
reported, (iii) if the Common Stock is not so listed or quoted but are traded in
the over-the-counter market, the mean between the closing bid and asked price on
that date, or, if there are no quotations available for such date, on the last
preceding date on which such quotations shall be available, as reported by the
Nasdaq Stock Market, or, if not reported by the Nasdaq Stock Market, by the
National Quotation Bureau Incorporated, or (iv) if a determination pursuant to
the provisions of clause (i), (ii) or (iii) above is not practical, then such
amount as may be determined by the Committee in its discretion. The
determination of Fair Market Value shall be consistent with the requirements of
Section 409A.
"Incentive Option" means an Option that is intended to comply with the
requirements set forth in Section 422 of the Code.
"Noncompetition Provisions" has the meaning set forth in paragraph 8(c)
hereof.
"Nonqualified Option" means an Option that is not an Incentive Option.
"Option" means a right to purchase a specified number of shares of Common
Stock at a specified price.
"Participant" means an Employee or Director to whom an Award has been made
under this Plan.
"Performance Award" means an award made pursuant to this Plan to a
Participant who is an Employee that is subject to the attainment of one or more
Performance Goals.
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"Performance Goal" means a standard established by the Committee, to
determine in whole or in part whether a Performance Award shall be earned.
"Restricted Stock" means any Common Stock that is restricted or subject to
forfeiture provisions.
"Restriction Period" means a period of time beginning as of the date upon
which an Award of Restricted Stock is made pursuant to this Plan and ending as
of the date upon which the Common Stock subject to such Award is no longer
restricted or subject to forfeiture provisions.
"Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act, or any
successor rule.
"SAR" means a right to receive a payment, in cash or Common Stock (as
determined by the Committee), equal to the excess of the Fair Market Value or
other specified valuation of a specified number of shares of Common Stock on the
date the right is exercised over a the Fair Market Value of the underlying
shares of Common Stock on the date of the grant.
"Section 409A" means Section 409A of the Code and the regulations and
guidance of general applicability issued thereunder.
"Stock Award" means an award in the form of shares of Common Stock or units
denominated in shares of Common Stock.
"Subsidiary" means (i) in the case of a corporation, any corporation of
which the Company directly or indirectly owns shares representing more than 50%
of the combined voting power of the shares of all classes or series of capital
stock of such corporation which have the right to vote generally on matters
submitted to a vote of the shareholders of such corporation and (ii) in the case
of a partnership, limited liability company or other business entity not
organized as a corporation, any such business entity of which the Company
directly or indirectly owns more than 50% of the voting, capital or profits
interests (whether in the form of partnership interests, membership interests or
otherwise).
4. Eligibility.
(a) Employees. Employees eligible for Employee awards under this Plan shall
consist of those Employees whose performance or contribution, in the judgment of
the Committee, benefits or will benefit the Company.
(b) Directors. Directors eligible for Director Awards under this Plan are
those who are Directors of the Company.
5. Common Stock Available for Awards. Subject to the provisions of
paragraph 15 hereof, the aggregate number of shares of Common Stock that may be
issued under the Plan for Awards granted wholly or partly in Common Stock
(including rights or options which may be exercised for or settled in Common
Stock) is 353,575 shares, of which an aggregate of not more than 44,100 shares
shall be available for Director Awards and the remainder (including any of the
44,100 shares not used for Director Awards) shall be available for Employee
Awards, including Incentive Options (provided, that no Award of an Incentive
Option with respect to such shares shall be made on or after February 1, 2012).
The number of shares of Common Stock that are the subject of any Awards that are
forfeited or terminated, expire unexercised, are settled in cash in lieu of
Common Stock or in a manner such that all or some of the shares covered by the
Award are not issued to a Participant or are exchanged for Awards that do not
involve Common Stock, shall again immediately become available for issuance
under Awards hereunder. The Committee may from time to time adopt and observe
such procedures concerning the counting of
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shares against the Plan maximum as it may deem appropriate. The Board and the
appropriate officers of the Company shall from time to time take whatever
actions are necessary to file any required documents with governmental
authorities, stock exchanges, automated quotation systems and transaction
reporting systems to ensure that shares of Common Stock are available for
issuance pursuant to Awards.
6. Administration.
(a) This Plan shall be administered by the Committee. The Board, in its
sole discretion may exercise any authority of the Committee under the Plan in
lieu of the Committee's exercise thereof, in which instances references to the
Committee shall refer to the Board. To the extent required (i) in order for
Employee Awards to be exempt from Section 16 of the Exchange Act by virtue of
the provision of Rule 16b-3, the Committee shall be the Board or shall consist
of at least two members of the Board who meet the requirements of the definition
of "non-employee director" set forth in Rule 16b-3 promulgated under the
Exchange Act, and (ii) with respect to any Award that is intended to qualify as
"performance-based compensation" under Section 162(m) of the Code, the Committee
shall consist of two or more directors, each of whom meets the definition of
"outside director" under said Section 162(m).
(b) Subject to the provisions hereof, the Committee shall have full and
exclusive power and authority to administer this Plan and to take all actions
which are specifically contemplated hereby or are necessary or appropriate in
connection with the administration hereof. The Committee shall also have full
and exclusive power to interpret this Plan and to adopt, amend and rescind such
rules, regulations and guidelines for carrying out this Plan as it may deem
necessary or proper, all of which powers shall be exercised in the best
interests of the Company and in keeping with the objectives of this Plan. The
Committee may, in its discretion, provide for the extension of the
exercisability of an Award, accelerate the vesting or exercisability of an
Award, eliminate or make less restrictive any restrictions contained in an
Award, waive any restriction or other provision of this Plan or an Award or
otherwise amend or modify an Award in any manner that is either (i) not adverse
to the Participant to whom such Award was granted or (ii) consented to by such
Participant. The Committee may correct any defect or supply any omission or
reconcile any inconsistency in this Plan or in any Award in the manner and to
the extent the Committee deems necessary or desirable to carry it into effect.
Any decision of the Committee in the interpretation and administration of this
Plan shall lie within its sole and absolute discretion and shall be final,
conclusive and binding on all parties concerned.
(c) No member of the Committee or officer of the Company to whom the
Committee has delegated authority in accordance with the provisions of paragraph
7 of this Plan shall be liable for anything done or omitted to be done by him or
her, by any member of the Committee or by any officer of the Company in
connection with the performance of any duties under this Plan, except for his or
own willful misconduct or as expressly provided by statute.
7. Delegation of Authority. The Committee may delegate to the Chairman of
the Board, the President or to other senior officers of the Company any of its
duties under this Plan pursuant to such conditions or limitations as the
Committee may establish, except that the Committee may not delegate to any
person the authority to grant Awards to, or take other action with respect to,
Participants who at the time of such awards or action are subject to Section 16
of the Exchange Act or are "covered employees" as defined in Section 162(m) of
the Code.
8. Employee Awards.
(a) The Committee shall determine the type or types of Employee Awards to
be made under this Plan and shall designate from time to time the Employees who
are to be the recipients of such Awards. Each Employee Award may be embodied in
an Employee Award Agreement, which shall
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contain such terms, conditions and limitations as shall be determined by the
Committee in its sole discretion and shall be signed by the Participant to whom
the Employee Award is made and by an Authorized Officer for and on behalf of the
Company. Employee Awards may consist of those listed in this paragraph 8(a)
hereof and may be granted singly, in combination or in tandem. No term,
condition or limitation associated with any Employee Award shall be permitted
that causes either the Employee Award or the Plan to be subject to Section 409A.
Employee Awards may also be made in combination or in tandem with, in
replacement of, or as alternatives to, grants or rights under this Plan or any
other employee plan of the Company or any of its Subsidiaries, including the
plan of any acquired entity. An Employee Award may provide for the grant or
issuance of additional, replacement or alternative Employee Awards upon the
occurrence of specified events, including the exercise of the original Employee
Award granted to a Participant. All or part of an Employee Award may be subject
to conditions established by the Committee, which may include, but are not
limited to, continuous service with the Company or its Subsidiaries, achievement
of specific business objectives, increases in specified indices, attainment of
specified growth rates and other comparable measurements of performance. Upon
the termination of employment by a Participant who is an Employee, any
unexercised, deferred, unvested or unpaid Employee Awards shall be treated as
set forth in the applicable Employee Award Agreement.
(i) Stock Option. An Employee Award may be in the form of an Option.
An Option awarded pursuant to this Plan may consist of an Incentive Option
or a Nonqualified Option. The price at which shares of Common Stock may be
purchased upon the exercise of an Incentive Option shall be not less than
the Fair Market Value of the Common Stock on the date of grant. The price
at which shares of Common Stock may be purchased upon the exercise of a
Nonqualified Option shall be not less than the Fair Market Value of the
Common Stock on the date of grant. Incentive Options shall only be issued
to employees of the Company, or any Subsidiary of the Company whose
employees are eligible to receive Incentive Options under the Code. Subject
to the foregoing provisions, the terms, conditions and limitations
applicable to any Options awarded pursuant to this Plan, including the term
of any Options and the date or dates upon which they become exercisable,
shall be determined by the Committee.
(ii) Stock Appreciation Right. An Employee Award may be in the form of
an SAR. The terms, conditions and limitations applicable to any SARs
awarded pursuant to this Plan, including the term of any SARs and the date
upon which they become exercisable, shall be determined by the Committee.
For any SAR awarded after December 31, 2004, the exercise price may not be
less than the Fair Market Value of the underlying shares of Common Stock on
the date the SAR is granted.
(iii) Stock Award. An Employee Award may be in the form of a Stock
Award. The terms, conditions and limitations applicable to any Stock Awards
granted pursuant to this Plan shall be determined by the Committee.
(iv) Cash Award. An Employee Award may be in the form of a Cash Award.
The terms, conditions and limitations applicable to any Cash Awards granted
pursuant to this Plan shall be determined by the Committee.
(v) Performance Award. Without limiting the type or number of Employee
Awards that may be made under the other provisions of this Plan, an
Employee Award may be in the form of a Performance Award. A Performance
Award shall be paid, vested or otherwise deliverable solely on account of
the attainment of one or more pre-established, objective Performance Goals
established by the Committee prior to the earlier to occur of (x) 90 days
after the commencement of the period of service to which the Performance
Goal relates and (y) the elapse of 25% of the period of service (as
scheduled in good faith at the time the goal is established), and in any
event
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while the outcome is substantially uncertain. A Performance Goal is
objective if a third party having knowledge of the relevant facts could
determine whether the goal is met. A Performance Goal may be based on one
or more of business criteria that apply to the individual, one or more
business units of the Company or a Subsidiary, or the Company as a whole,
and may include one or more of the following criteria: revenue, net income,
Common Stock price, shareholder return, shareholder value, economic value,
earnings per share, market performance, return on assets, return on equity,
earnings, operating profits, cash flow, working capital costs, new business
contract values, and/or such other financial, accounting or quantitative
metric determined by the Committee. A Performance Goal may, but need not
be, based upon a change or an increase or positive result under a
particular business criterion and could include, for example, maintaining
the status quo, limiting economic losses, or a relative comparison of
performance to the performance of a peer group or other external or
internal measure (measured, in each case, by reference to specific business
criteria). A Performance Goal may include or exclude items to measure
specific objectives, including, without limitation, extraordinary or other
non-recurring items, acquisitions and divestitures, internal restructuring
and reorganizations, accounting charges and effects of accounting changes.
In interpreting Plan provisions applicable to Performance Goals and
Performance Awards applicable to Awards to employees who are "covered
employees" under Section 162(m) of the Code, it is the intent of the Plan
to conform with the standards of Section 162(m) of the Code and Treasury
Regulations Section 1.162-27(e)(2), and the Committee in establishing such
goals and interpreting the Plan shall be guided by such provisions. Prior
to the payment of any compensation based on the achievement of Performance
Goals to any such "covered employee", the Committee must certify in writing
that applicable Performance Goals and any of the material terms thereof
were, in fact, satisfied. Subject to the foregoing provisions, the terms,
conditions and limitations applicable to any Performance Awards made
pursuant to this Plan shall be determined by the Committee; provided,
however, that no Performance Award issued after December 31, 2004, shall
include provisions that would cause the Performance Award to be subject to
Section 409A.
(b) Notwithstanding anything to the contrary contained in this Plan, the
following limitations shall apply to any Employee Awards made hereunder:
(i) No Participant may be granted, during any calendar year period,
Employee Awards consisting of Options or SARs that are exercisable for more
than 20,000 shares of Common Stock, subject to adjustment pursuant to the
provisions of paragraph 15 hereof;
(ii) No Participant may be granted, during any calendar year period,
Employee Awards consisting of shares of Common Stock or units denominated
in such shares (other than any Employee Awards consisting of Options or
SARs) covering or relating to more than 15,000 shares of Common Stock,
subject to adjustment pursuant to the provisions of paragraph 15 hereof
(the limitation set forth in this clause (ii), together with the limitation
set forth in clause (i) above, being hereinafter collectively referred to
as the "Stock Based Awards Limitations"); and
(iii) No Participant may be paid under any Employee Awards consisting
of Cash Awards or any other form permitted under this Plan (other than
Employee Awards consisting of Options or SARs or otherwise consisting of
shares of Common Stock or units denominated in such shares) in respect of
any calendar-year period an amount in excess of $200,000.
(c) Awards shall be subject to such restrictions and other provisions
relating to competition or other conduct detrimental to the Company as
determined by the Committee.
9. Director Awards of Common Stock.
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(a) Each Director of the Company shall be granted Director Awards in
accordance with this paragraph 9 and subject to the applicable terms, conditions
and limitations set forth in this Plan and the applicable Director Award
Agreement. Notwithstanding anything to the contrary contained herein, Director
Awards shall not be made in any year in which a sufficient number of shares of
Common Stock are not available to make such Awards under this Plan.
(b) On each Annual Director Award Date occurring on or after January 1,
2002 and on or before December 31, 2010, each Director shall automatically be
granted a Stock Award of 300 shares of Common Stock. Each Director Award may be
accompanied by a Director Award Agreement, which shall contain such terms,
conditions and limitations as shall be determined by the Board or Committee in
its discretion, and shall be signed by the Participant to whom the Director
Award is granted and may be signed by an Authorized Officer for and on behalf of
the Company.
10. Payment of Awards.
(a) General. Payment of Employee Awards may be made in the form of cash or
Common Stock, or a combination thereof, and may include such restrictions as the
Committee shall determine, including, in the case of Common Stock, restrictions
on transfer and forfeiture provisions. If payment of an Employee Award is made
in the form of Restricted Stock, the Employee Award Agreement relating to such
shares shall specify whether they are to be issued at the beginning or end of
the Restriction Period. In the event that shares of Restricted Stock are to be
issued at the beginning of the Restriction Period, the certificates evidencing
such shares (to the extent that such shares are so evidenced) shall contain
appropriate legends and restrictions that describe the terms and conditions of
the restrictions applicable thereto. In the event that shares of Restricted
Stock are to be issued at the end of the Restricted Period, the right to receive
such shares shall be evidenced in such manner as the Committee may determine.
(b) Dividends and Interest. Rights to dividends or Dividend Equivalents may
be extended to and made part of any Employee Award consisting of shares of
Common Stock or units denominated in shares of Common Stock, subject to such
terms, conditions and restrictions as the Committee may establish. The Committee
may also establish rules and procedures for the crediting of interest on
deferred cash payments and Dividend Equivalents for Employee Awards consisting
of shares of Common Stock or units denominated in shares of Common Stock.
(c) Substitution of Awards. At the discretion of the Committee, a
Participant who is an Employee may be offered an election to substitute an
Employee Award for another Employee Award or Employee Awards of the same or
different type.
11. Stock Option Exercise. The price at which shares of Common Stock may be
purchased under an Option shall be paid in full at the time of exercise in cash
or if elected by the optionee, the optionee may purchase such shares by means of
tendering Common Stock or, if approved by the Committee, by surrendering another
Award, including Restricted Stock, valued at Fair Market Value on the date of
exercise, or any combination thereof. The Committee shall determine acceptable
methods for Participants who are Employees to tender Common Stock (including by
attestation of ownership) or other Employee Awards; provided that any Common
Stock that is or was the subject of an Employee Award may be so tendered only if
it has been held by the Participant for six months. The Committee may provide
for procedures to permit the exercise or purchase of such Awards by use of the
proceeds to be received from the sale of Common Stock issuable pursuant to an
Employee Award. Unless otherwise provided in the applicable Award Agreement, in
the event shares of Restricted Stock are tendered as consideration for the
exercise of an Option, a number of the shares issued upon the exercise of the
Option,
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equal to the number of shares of Restricted Stock used as consideration
therefor, shall be subject to the same restrictions as the Restricted Stock so
submitted as well as any additional restrictions that may be imposed by the
Committee.
12. Tax Withholding. The Company shall have the right to deduct applicable
taxes from any Employee Award payment and withhold, at the time of delivery or
vesting of cash or shares of Common Stock under this Plan, or if later, the date
of income recognition, an appropriate amount of cash or number of shares of
Common Stock or a combination thereof for payment of taxes required by law or to
take such other action as may be necessary in the opinion of the Company to
satisfy all obligations for withholding of such taxes. The Committee may also
permit withholding to be satisfied by the transfer to the Company of shares of
Common Stock theretofore owned by the holder of the Employee Award with respect
to which withholding is required. If shares of Common Stock are used to satisfy
tax withholding, such shares shall be valued based on the Fair Market Value when
the tax withholding is required to be made. The Committee may provide for loans,
on either a short term or demand basis, from the Company to a Participant who is
an Employee to permit the payment of taxes required by law.
13. Amendment, Modification, Suspension or Termination. The Board may
amend, modify, suspend or terminate this Plan for the purpose of meeting or
addressing any charges in legal requirements or for any other purpose permitted
by law, except that (a) no amendment or alteration that would adversely affect
the rights of any Participant under any Award previously granted to such
Participant shall be made without the consent of such Participant, and (b) no
amendment or alteration of either the Plan or an Award shall be permitted that
results in either the plan or the Award being subject to Section 409A and any
such amendment or alteration shall be void ab initio.
14. Assignability. Except as provided below, no Award or any other benefit
under this Plan shall be assignable or otherwise transferable except by will or
the laws of descent and distribution or as required pursuant to a qualified
domestic relations order as defined by the Code or Title I of the Employee
Retirement Income Security Act, or the rules thereunder. Notwithstanding the
foregoing, the Committee may, in its discretion, authorize all or a portion of
the Nonqualified Options granted to a Participant to be transferable to:
(a) the spouse, parents, children, stepchildren, grandchildren or legal
dependents of the Participant ("Immediate Family Members");
(b) a trust or trusts solely for the benefit of the Participant and/or
such Immediate Family Members, or;
(c) a partnership or limited liability company in which the only partners
or members, as applicable, are the Participant, such Immediate Family
Members and/or a trust or trusts solely for the benefit of the
Participant and/or such Immediate Family Members;
provided that:
(i) there may be no consideration for any such transfer;
(ii) the Employee Award Agreement pursuant to which such Options are
granted expressly provides for transferability in a manner
consistent with this paragraph 14, and
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(iii) subsequent transfers of transferred Options shall be prohibited
except those to the Participant or individuals or entities
described in clauses (a), (b) or (c) above, or by the laws of
descent or distribution.
Following transfer, any such Options shall continue to be subject to the same
terms and conditions as were applicable immediately prior to transfer, including
but not limited to, the restrictions or other provisions relating to competition
or other conduct detrimental to the Company, and (ii) the obligation of the
Participant for payment of taxes with respect to the exercise of such Options
and the rights of the Company to withhold such taxes from the Participant or to
otherwise require the Participant to satisfy all obligations for the withholding
of such taxes as contemplated by paragraph 12 above. The provisions relating to
the period of exercisability and expiration of the Option shall continue to be
applied with respect to the original Participant, and the Options shall be
exercisable by the transferee only to the extent, and for the periods, set forth
in the Employee Award Agreement.
The Committee may prescribe and include in applicable Award Agreements
other restrictions on transfer. Any attempted assignment of an Award or any
other benefit under this Plan in violation of this paragraph 14 shall be null
and void.
15. Adjustments.
(a) The existence of outstanding Awards shall not affect in any manner the
right or power of the Company or its shareholders to make or authorize any or
all adjustments, recapitalizations, reorganizations or other changes in the
capital stock of the Company or its business or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior preference
stock (whether or not such issue is prior to, on a parity with or junior to the
Common Stock) or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other corporate
act or proceeding of any kind, whether or not of a character similar to that of
the acts or proceedings enumerated above.
(b) In the event of any subdivision or consolidation of outstanding shares
of Common Stock, declaration of a dividend payable in shares of Common Stock or
other stock split, then (i) the number of shares of Common Stock reserved under
this Plan, (ii) the number of shares of Common Stock covered by outstanding
Awards in the form of Common Stock or units denominated in Common stock, (iii)
the exercise or other price in respect of such Awards, (iv) the appropriate Fair
Market Value and other price determinations for such Awards, (v) the number of
shares of Common Stock automatically granted pursuant to paragraph 9 hereof, and
(vi) the Stock Based Awards Limitations shall each be proportionately adjusted
by the Board to reflect such transaction. In the event of any other
recapitalization or capital reorganization of the Company, any consolidation or
merger of the Company with another corporation or entity, the adoption by the
Company of any plan of exchange affecting the Common Stock or any distribution
to holders of Common Stock of securities or property (other than normal cash
dividends or dividends payable in Common Stock), the Board or Committee shall
make appropriate adjustments to (i) the number of shares of Common Stock covered
by Awards in the form of Common Stock or units denominated in Common Stock, (ii)
the exercise or other price in respect of such Awards, (iii) the appropriate
Fair Market Value and other price determinations for such Awards, (iv) the
number of shares of Common Stock automatically granted pursuant to paragraph 9
hereof and (v) the Stock Based Awards Limitations to give effect to such
transaction shall each be proportionately adjusted by the Board to reflect such
transaction; provided that such adjustments shall only be such as are necessary
to maintain the proportionate interest of the holders of the Awards and
preserve, without exceeding the value of such Awards. In the event of a
corporate merger, consolidation, acquisition of property or stock, separation,
reorganization or liquidation, the Board shall be authorized to issue or assume
Awards by means of substitution of new Awards, as appropriate, for previously
issued Awards or
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an assumption of previously issued Awards as part of such adjustment. The
preceding sentence shall be applied in a manner that does not cause any of the
Awards to be treated as a liability for financial statement purposes pursuant to
Financial Accounting Standards Board Number 123R.
16. Restrictions. No Common Stock or other form of payment shall be issued
with respect to any Award unless the Company shall be satisfied based on the
advice of its counsel that such issuance will be in compliance with applicable
federal and state securities laws. It is the intent of the Company that this
Plan comply with Rule 16b-3 with respect to persons subject to Section 16 of the
Exchange Act unless otherwise provided herein or in an Award Agreement, that any
ambiguities or inconsistencies in the construction of this Plan be interpreted
to give effect to such intention, and that if any provision of this Plan is
found not to be in compliance with Rule 16b-3, such provision shall be null and
void to the extent required to permit this Plan to comply with Rule 16b-3.
Certificates evidencing shares of Common Stock certificates delivered under this
Plan (to the extent that such shares are so evidenced) may be subject to such
stop transfer orders and other restrictions as the Committee may deem advisable
under the rules, regulations and other requirements of the Securities and
Exchange Commission, any securities exchange or transaction reporting system
upon which the Common Stock is then listed or to which it is admitted for
quotation and any applicable federal or state securities law. The Committee may
cause a legend or legends to be placed upon such certificates (if any) to make
appropriate reference to such restrictions. Any Award Agreement may include
representations, warranties and agreements by the Participant that the Committee
deems appropriate to establish that an exemption from registration is available
under any applicable securities law.
17. Unfunded Plan. Insofar as it provides for Awards of cash, Common Stock
or rights thereto, this Plan shall be unfunded. Although bookkeeping accounts
may be established with respect to Participants who are entitled to cash, Common
Stock or rights thereto under this Plan, any such accounts shall be used merely
as a bookkeeping convenience. The Company shall not be required to segregate any
assets that may at any time be represented by cash, Common Stock or rights
thereto, nor shall this Plan be construed as providing for such segregation, nor
shall the Company, the Board or the Committee be deemed to be a trustee of any
cash, Common Stock or rights thereto to be granted under this Plan. Any
liability or obligation of the Company to any Participant with respect to an
Award of cash, Common Stock or rights thereto under this Plan shall be base
solely upon any contractual obligations that may be created by this Plan and any
Award Agreement, and no such liability or obligation of the Company shall be
deemed to be secured by any pledge or other encumbrance on any property of the
Company. Neither the Company nor the Board or the Committee shall be required to
give any security bond for the performance of any obligation that may be created
by this Plan.
18. Governing Law. This Plan and all determinations made and actions taken
pursuant hereto, to the extent not otherwise governed by mandatory provisions of
the Code or the securities laws of the United States, shall be governed by and
construed in accordance with the laws of the State of Michigan.
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Community Central Bank Corporation
[ ] Mark this box with an X if you have made
changes to your name or address details above.
ANNUAL MEETING PROXY CARD
A ELECTION OF DIRECTORS PLEASE REFER TO THE REVERSE SIDE FOR INTERNET AND TELEPHONE VOTING INSTRUCTIONS.
1. The Board of Directors recommends a vote FOR the listed nominees.
For Withhold
01 - Joseph Catenacci [ ] [ ]
For Withhold
02 - Celestina Giles [ ] [ ]
For Withhold
03 - David A. Widlak [ ] [ ]
B ISSUES
The Board of Directors recommends a vote FOR the amendment to the 2002 Incentive
Plan.
2. Amendment to the 2002 Incentive Plan to For Against Abstain
add 100,000 shares to the existing plan. [ ] [ ] [ ]
In their discretion, the proxies are authorized to vote upon any other business
that may properly come before the meeting, or at any adjournment(s) thereof.
[ ] Mark this box with an X if you have made comments below.
_________________________________________________________________________
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C AUTHORIZED SIGNATURES - SIGN HERE - THIS SECTION MUST BE COMPLETED FOR YOUR INSTRUCTIONS TO BE EXECUTED.
PLEASE BE SURE TO SIGN AND DATE THIS PROXY CARD. PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) HEREON. JOINT OWNERS SHOULD
EACH SIGN PERSONALLY. TRUSTEES AND OTHER FIDUCIARIES SHOULD INDICATE THE CAPACITY IN WHICH THEY SIGN. IF A CORPORATION OR
PARTNERSHIP, THE SIGNATURE SHOULD BE THAT OF AN AUTHORIZED PERSON WHO SHOULD STATE HIS OR HER TITLE.
Signature 1 - Please keep signature within the box Signature 2 - Please keep signature within the box Date (mm/dd/yyyy)
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PROXY - COMMUNITY CENTRAL BANK CORPORATION
120 NORTH MAIN STREET
MOUNT CLEMENS, MI 48043
ANNUAL MEETING OF STOCKHOLDERS - APRIL 18, 2006
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Salvatore Cottone and Dean S. Petitpren, or
either of them, with full power of substitution in each, as proxies to vote all
of the shares of common stock of Community Central Bank Corporation which the
undersigned is entitled to vote at the Annual Meeting of Stockholders of
Community Central Bank Corporation to be held at the Best Western Concorde Inn,
44315 Gratiot Avenue, Clinton Township, Michigan 48036, on Tuesday, April 18,
2006, at 9:00 a.m., or at any adjournment or postponement thereof, as follows on
the reverse side.
THIS PROXY, WHEN PROPERLY EXECUTED AND TIMELY RETURNED, WILL BE VOTED AS
DIRECTED HEREIN. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED "FOR" ALL
NOMINEES, "FOR" THE AMENDMENT TO THE 2002 INCENTIVE PLAN AND IN THE DISCRETION
OF THE PROXY HOLDER ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE
MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF. SHOULD A NOMINEE BE UNABLE
TO SERVE AS A DIRECTOR, AN EVENT THAT WE DO NOT ANTICIPATE, THE PERSONS NAMED IN
THIS PROXY RESERVE THE RIGHT, IN THEIR DISCRETION, TO VOTE FOR A SUBSTITUTE
NOMINEE DESIGNATED BY THE CORPORATION.
PLEASE VOTE, DATE AND SIGN ON REVERSE SIDE, AND RETURN PROMPTLY USING THE
ENCLOSED ENVELOPE.
Dear Stockholder,
Please take note of the important information enclosed with this proxy card. You
are requested to vote on the election of directors and amendment to the 2002
Incentive Plan as discussed in the enclosed proxy materials. Your board of
directors recommends that you vote "FOR" all of the nominees and "FOR" the
amendment to the 2002 Incentive Plan.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Please mark the boxes on this proxy card to indicate how your shares will be
voted. Then sign and date the card, and return your proxy vote in the enclosed
postage paid envelope.
Your vote must be received prior to the Annual Meeting of Stockholders, April
18, 2006.
Thank you in advance for your prompt consideration of this matter.
Sincerely,
-------------------------------------
David A. Widlak
President and Chief Executive Officer