SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported): January 4, 2008
COOPERATIVE BANKSHARES, INC.
(Exact name of registrant as specified in charter)
NORTH CAROLINA 0-24626 56-1886527
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
201 MARKET STREET, WILMINGTON, NORTH CAROLINA 28401
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (910) 343-0181
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 5.02 COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.
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(e) On January 4, 2008, Cooperative Bank (the "Bank"), the wholly owned
subsidiary of Cooperative Bankshares, Inc. (the "Company"), entered into an
amended and restated supplemental executive retirement agreement (such
agreement, as amended and restated, being referred to herein as the "Agreement")
with its President and Chief Executive Officer, Frederick Willetts, III. The
Agreement, effective as of January 1, 2008, amends and restates Mr. Willetts'
prior supplemental executive retirement agreement with the Bank to ensure that
the benefits are consistent with the projections considered by the parties when
the supplemental executive retirement agreement was originally entered into, and
to ensure consistency with the benefits of similarly situated executives
employed by institutions in the Bank's peer group.
The Agreement provides Mr. Willetts with an annual retirement benefit,
for 24 years, following separation from service (other than for cause) on or
after attaining age 65. This retirement benefit equals 75% of the following
calculation: the highest rate of annual base salary received by Mr. Willetts
during the 60-month period preceding termination of employment, minus:
A) one-half of the annual amount payable (before any earnings
reduction) to him as a primary Social Security retirement benefit at
age 65;
B) the annual benefit payable to him as a single life annuity under any
tax-qualified defined benefit pension plan of the Bank in which he was
a participant during his period employment with the Bank; and
C) the annual benefit that would be payable to him under any
tax-qualified defined contribution plan of the Bank if he received the
balance to his account under such plan(s) in the form of an actuarially
equivalent single-life annuity (subject to certain limitations).
If Mr. Willetts separates from service prior to age 65 for reasons
other than death, disability or following a change in control, he would receive
an early retirement benefit based on the extent to which the annual retirement
benefit described above should be accrued by the Bank under generally accepted
accounting principles as of the date of termination. If Mr. Willetts separates
from service due to death or disability or following a change-in-control of the
Company, he or his beneficiary will receive the normal retirement benefit,
regardless of his age at the time of separation from service or death. In the
event of a change-in-control of the Company, Mr. Willetts will receive his
benefit in the form of a lump sum payment. The agreement provides that benefit
payments will not commence until six months following Mr. Willetts' separation
from service, to the extent required under Section 409A of the Internal Revenue
Code of 1986, as amended.
The foregoing summary of the Agreement is qualified in its entirety by
the Agreement itself, a copy of which is attached hereto as Exhibit 10.1 and
which is incorporated herein by reference.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
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(d) Exhibits
Number Description
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10.1 Supplemental Executive Retirement Agreement by and
between Cooperative Bank and Frederick Willetts, III,
executed January 4, 2008
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
COOPERATIVE BANKSHARES, INC.
/s/ Frederick Willetts, III
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Frederick Willetts, III
President
Date: January 4, 2008