1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
SCHEDULE 13D
(RULE 13D-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13D-1(A) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13D-2(A)
(AMENDMENT NO. 8)
Cooperative Bankshares, Inc.
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(Name of Issuer)
Common Stock, par value $1.00 per share
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(Title of Class of Securities)
216844 10 0
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(CUSIP Number)
Frederick Willetts, III
Cooperative Bank
201 Market Street
P.O. Box 600
Wilmington, North Carolina 28402-0600
(910) 343-0181
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(Name, address and telephone number of person
authorized to receive notices and communications)
December 31, 2005
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(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box. /_/
2
CUSIP NO.: 216844 10 0
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1 NAME OF REPORTING PERSON: FREDERICK WILLETTS, III
I.R.S. IDENTIFICATION NOS. OF REPORTING PERSON (ENTITIES ONLY)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) /_/
(b) /_/
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
PF, OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) /_/
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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NUMBER OF SOLE VOTING POWER 415,089 (1)(2)
SHARES
BENEFICIALLY ------------------------------------------------
OWNED BY SHARED VOTING POWER 245,641
EACH
REPORTING ------------------------------------------------
PERSON SOLE DISPOSITIVE POWER 372,412 (1)(2)
WITH
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SHARED DISPOSITIVE POWER 245,641 (1)(2)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
780,113 (1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
/_/
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
18.1% of 4,305,316 shares of Common Stock outstanding
as of December 31, 2005. (1)
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14 TYPE OF REPORTING PERSON
IN
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(1) Includes 43,000 shares that may be acquired pursuant to currently
exercisable stock options.
(2) Includes shares held in the 401(k) Plan for which Mr. Willetts serves as
trustee. See Item 3 for discussion of the 401(k) Plan holdings.
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1 NAME OF REPORTING PERSON:
COOPERATIVE BANK 401(K) SUPPLEMENTAL RETIREMENT PLAN
I.R.S. IDENTIFICATION NOS. OF REPORTING PERSON (ENTITIES ONLY)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) /_/
(b) /_/
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) /_/
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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NUMBER OF SOLE VOTING POWER 180,948
SHARES
BENEFICIALLY ------------------------------------------------
OWNED BY SHARED VOTING POWER 0
EACH
REPORTING ------------------------------------------------
PERSON SOLE DISPOSITIVE POWER 135,337
WITH
------------------------------------------------
SHARED DISPOSITIVE POWER 0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
316,285
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
/_/
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
7.4% of 4,305,316 shares of Common Stock outstanding
as of December 31, 2005.
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14 TYPE OF REPORTING PERSON
EP
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The undersigned hereby amends the Schedule 13D filing made on September
19, 1994 (the "Schedule 13D"), as amended by Amendment #1 on February 20, 1996,
Amendment #2 on September 15, 1998, Amendment #3 on January 31, 2000, Amendment
#4 on April 11, 2002, Amendment #5 on February 12, 2003, Amendment #6 on
February 10, 2004 and Amendment #7 on February 7, 2005 pursuant to Rule 13d-2(a)
under the Securities Exchange Act of 1934, as amended, as set forth below. As
disclosed in Amendment #4, Mr. Willetts became a named fiduciary with respect to
the Cooperative Bank 401(k) Supplemental Retirement Plan (the "401(k) Plan").
The 401(k) Plan previously filed a Schedule 13G and various amendments thereto
with respect to its ownership of shares of Cooperative Bankshares, Inc. common
stock. The 401(k) Plan became a party to Mr. Willetts' Schedule 13D in Amendment
No. 4. The 401(k) Plan is structured as a combined employee stock ownership plan
("ESOP") and 401(k) Plan. Accordingly, the 401(k) Plan maintains separate
accounts for shares related to the ESOP ("ESOP Accounts") and shares related to
401(k) savings accounts ("401(k) Savings Accounts"). As trustee of the 401(k)
Plan, Mr. Willetts has the sole power to direct the voting of all shares of
Cooperative Bankshares, Inc. common stock held in the 401(k) Savings Accounts,
and has the power to direct the disposition of shares held in the ESOP Accounts.
As of December 31, 2005, the 410(k) Plan held 180,948 shares in 401(k) Savings
Accounts and 135,337 shares in ESOP Accounts.
ITEM 1. SECURITY AND ISSUER.
The class of equity securities to which this statement relates is the
common stock, par value $1.00 per share (the "Common Stock"), of Cooperative
Bankshares, Inc. (the "Issuer"). The executive office of the Issuer is located
at 201 Market Street, P.O. Box 600, Wilmington, North Carolina 28402-0600.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This Statement is filed by:
NAME: Frederick Willetts, III
NAME: Cooperative Bank 401(k) Supplemental Retirement Plan
Unless otherwise specified herein, Mr. Willetts and the 401(k)
Plan are collectively referred to herein as the "Reporting
Persons".
(b) ADDRESS: 201 Market Street, P.O. Box 600, Wilmington, North
Carolina 28402-0600 (for both Reporting Persons)
(c) PRESENT PRINCIPAL OCCUPATION: Mr. Willetts: Director,
President, and Chief Executive Officer of the Issuer. The
401(k) Plan is an employee benefit plan maintained by the
Issuer.
(d) CRIMINAL PROCEEDING CONVICTIONS: None
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(e) SECURITIES LAW PROCEEDINGS: None
(f) CITIZENSHIP: United States
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
All shares of Common Stock shown as to which Mr. Willetts has sole
voting and sole dispositive power were purchased with Mr. Willetts' personal
funds except for 500 shares of Common Stock that he received as a gift, 31,556
shares of Common Stock owned by trusts for which he serves as sole trustee,
15,954 shares allocated to him under his ESOP Account and 8,368 shares issued to
him in his 401(k) Savings Account pursuant to employer matching contributions
under the 401(k) Plan. As trustee of the 401(k) Plan, Mr. Willetts has sole
voting power with respect to 180,948 shares held in 401(k) Savings Accounts,
including 18,888 shares held in Mr. Willets' 401(k) Savings Account. As trustee
of the 401(k) Plan, Mr. Willetts has sole dispositive power over 135,337 shares
of Common Stock held by participants in ESOP Accounts in the 401(k) Plan,
including 15,954 shares held in his ESOP Account. Mr. Willetts holds sole
dispositive power and voting power with respect to the 43,000 shares of Common
Stock which may be purchased by him pursuant to currently exercisable options.
Beneficial ownership for the shares of Common Stock shown as to which
Mr. Willetts has shared voting and shared dispositive power was acquired without
payment as follows: (i) the reporting person became beneficial owner of 105,465
shares of Common Stock when he became co-trustee of the Eleanor J. H. Willetts
Irrevocable Trust; (ii) Mr. Willetts also serves as co-trustee of the Frederick
Willetts, III, Helen Margaret Willetts and Elizabeth Messick Willetts Trust
which holds 31,077 shares of Common Stock; and (iii) he also may be deemed to be
the beneficial owner of 2,277 shares of Common Stock owned by his spouse and the
671 shares of Common Stock for which his spouse serves as custodian for their
children. Due to the fact that Mr. Willetts holds general powers of attorney for
his mother and his two sisters, he may also be deemed to share voting and
dispositive power with respect to: (i) 81,750 shares of Common Stock held by his
mother and her IRA account; (ii) 18,885 shares of Common Stock held by his
sister, Helen Margaret Willetts and 2,282 shares of Common Stock for which she
serves as custodian and trustee; and (iii) 3,234 shares of Common Stock owned by
his sister, Elizabeth M. Willetts. Copies of the powers of attorney were filed
as Exhibits 99.1-99.3 to Amendment #5. These powers of attorney were not entered
into in connection with the ownership of the Common Stock.
The 401(k) Plan holds sole voting power with respect to the 180,948
shares it holds in 401(k) Savings Accounts and sole dispositive power with
respect to 135,337 shares it holds in ESOP Accounts. The 401(k) Plan was
originally structured as a combined employee stock ownership plan and 401(k)
Plan. 84,374 shares of Common Stock were purchased by the ESOP through a loan
which has been repaid in full. The remaining 231,911 shares held by the 401(k)
Plan were purchased through the deferral of participants income pursuant to the
terms of the 401(k) Plan and matching contributions by the Bank.
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ITEM 4. PURPOSE OF TRANSACTION.
The shares of Common Stock covered by this statement are being held for
investment purposes. Depending upon a continuing assessment, and upon future
developments, the Reporting Person may determine, from time to time or at any
time, to purchase additional shares of Common Stock for investment or dispose of
shares of Common Stock. As President and Chief Executive Officer of the Issuer,
Mr. Willetts regularly explores potential actions and transactions which may be
advantageous to the Issuer, including possible mergers, acquisitions,
reorganizations or other material changes in the business, corporate structure,
management policies, governing instruments, securities or regulatory or
reporting obligations of the Issuer. As a member of the board of directors of
the Issuer, Mr. Willetts regularly reviews the Issuer's capital management
strategies. Mr. Willetts, as trustee of his sisters' trusts, and his childrens'
trust, may dispose of shares in accordance with his role as trustee. In
accordance with the rules and regulations of the Federal Reserve Board under the
Change in Bank Control Act, Mr. Willetts, together with shares held by family
members and the 401(k) Plan is deemed to own in excess of 10% of the outstanding
shares the Common Stock and was required to obtain the prior approval of the
Federal Reserve Board before becoming the named fiduciary with respect to the
401(k) Plan. Such approval was obtained from the Federal Reserve Board on April
1, 2002. Except as noted above with respect to Mr. Willetts' activities on
behalf of the Issuer, Mr. Willetts has no plans or proposals which relate to or
would result in:
(a) the acquisition by any person of additional securities of the
Issuer, or the disposition of securities of the Issuer, except
as described above;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of
its subsidiaries;
(c) a sale or transfer of a material amount of assets of the
Issuer or any of its subsidiaries;
(d) any change in the present board of directors or management of
the Issuer, including any plans or proposals to change the
number or term of directors;
(e) any material change in the present capitalization or dividend
policy of the Issuer;
(f) any other material change in the Issuer's business or
corporate structure;
(g) changes in the Issuer's Articles of Incorporation or Bylaws or
other actions which may impede the acquisition of control of
the Issuer by any person;
(h) causing a class of securities of the Issuer to be delisted
from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of
a registered national securities association;
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(i) a class of equity securities of the Issuer becoming eligible
for termination of registration pursuant to Section 12(g)(4)
of the Securities Exchange Act; or
(j) any action similar to any of those enumerated above.
The Reporting Person reserves the right to change his investment
purpose with respect to any and all shares of the Common Stock beneficially
owned and to take any and all lawful action with respect to such shares.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) The aggregate number of shares beneficially owned by the
Reporting Persons are 780,113, constituting 18.1% of the
outstanding shares of Common Stock. Included in this amount
are 43,000 shares of Common Stock which Mr. Willetts has the
right to acquire under the stock option plan of the Issuer.
(b) Mr. Willetts has sole voting and dispositive power over the
143,631 shares he holds directly, the 6,006 shares held in his
childrens' trust, over which he serves as sole trustee, and
the 25,550 shares held in the Elizabeth Messick Willetts
Medical Trust, over which he serves as sole trustee. Mr.
Willetts has sole voting and dispositive power with respect to
the 43,000 shares which he may acquire pursuant to the
exercise of currently exercisable stock options. As trustee of
the 401(k) Plan, Mr. Willetts has sole voting power with
respect to 180,948 shares held in 401(k) Savings Accounts,
including 18,888 shares held in Mr. Willets' 401(k) Savings
Account. As trustee of the 401(k) Plan, Mr. Willetts has sole
dispositive power over 135,337 shares of Common Stock held by
participants in ESOP Accounts in the 401(k) Plan, including
15,954 shares held in his ESOP Account. He shares voting and
dispositive power over the 136,542 shares held in two trusts
for which he serves as co-trustee and may be deemed to share
voting and dispositive power with respect to: (i) the 2,277
shares held by his spouse; (ii) the 671 shares for which his
spouse serves as custodian for the benefit of their children;
(iii) the 81,750 shares held by his mother and her IRA
account; (iv) the 18,885 shares held by Helen Margaret
Willetts; (v) the 2,282 shares for which Helen Margaret
Willetts serves as custodian and trustee; and (vi) the 3,234
shares owned by Elizabeth M. Willetts.
The 401(k) Plan holds sole voting power with respect to the
180,948 shares it holds in 401(k) Savings Accounts and sole
dispositive power with respect to 135,337 shares it holds in
ESOP Accounts. Each individual participant has the power to
instruct the 401(k) Plan to sell shares held in the Plan that
are attributable to such individual.
(c) The Reporting Persons' beneficial ownership changed during the
past 60 days as a result of the following transactions:
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NAME DATE # OF SHARES PRICE METHOD
---- ---- ----------- ----- ------
ELIZABETH M. WILLETTS 2/2/06 9,000 (1) $20.23 OPEN MARKET SALE
(1) On January 12, 2006, Elizabeth M. Willetts received a pro rata distribution
of 10,000 shares from the Willetts Building Trust.
(d) Not applicable.
(e) Not applicable.
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ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDING OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
Not applicable.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
None.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: February 14, 2006 /s/ Frederick Willetts, III
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Frederick Willetts, III
Date: February 14, 2006 Cooperative Bank 401(k) Supplemental
Retirement Plan
By: /s/ Frederick Willetts, III
--------------------------------
Frederick Willetts, III
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