Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
CNS BANCORP, INC.
(Name of Registrant as Specified in Its Charter)
CNS BANCORP, INC.
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
N/A
(2) Aggregate number of securities to which transactions applies:
N/A
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
N/A
(4) Proposed maximum aggregate value of transaction:
N/A
[ ] Check box if any part of the fee is offset as provided by Exchange Act
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:
N/A
(2) Form, schedule or registration statement no.:
N/A
(3) Filing party:
N/A
(4) Date filed:
N/A
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March 19, 1997
Dear Shareholder:
You are cordially invited to attend the first Annual Meeting of Shareholders
of CNS Bancorp, Inc. to be held at the Company's main office at 427 Monroe
Street, Jefferson City, Missouri, on Tuesday, April 22, 1997, at 10:00 a.m.,
local time. Effective June 11, 1996, the Company became the holding company
for City National Savings Bank, FSB.
The Notice of Annual Meeting of Shareholders and Proxy Statement appearing on
the following pages describe the formal business to be transacted at the
meeting. During the meeting, we will also report on the operations of the
Company. Directors and officers of the Company, as well as a representative
of Williams-Keepers, LLP, the Company's independent auditors, will be present
to respond to appropriate questions of shareholders.
It is important that your shares are represented at this meeting, whether or
not you attend the meeting in person and regardless of the number of shares
you own. To make sure your shares are represented, we urge you to complete
and mail the enclosed proxy card. If you attend the meeting, you may vote in
person even if you have previously mailed a proxy card.
We look forward to seeing you at the meeting.
Sincerely,
Robert E. Chiles
President and Chief Executive Officer
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CNS BANCORP, INC.
427 Monroe Street
Jefferson City, Missouri 65101
(573) 634-3336
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held On April 22, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of CNS Bancorp,
Inc. ("Company") will be held at the Company's main office at 427 Monroe
Street, Jefferson City, Missouri, on Tuesday, April 22, 1997, at 10:00 a.m.,
local time, for the following purposes:
(1) To elect three directors to serve for a term of three years;
(2) To consider and vote upon a proposal to adopt the CNS Bancorp,
Inc. 1997 Stock Option Plan;
(3) To consider and vote upon a proposal to adopt the CNS Bancorp,
Inc. 1997 Management Recognition and Development Plan; and
(4) To consider and act upon such other matters as may properly come
before the meeting or any adjournments thereof.
NOTE: The Board of Directors is not aware of any other business to come
before the meeting.
Any action may be taken on the foregoing proposals at the meeting on the
date specified above or on any date or dates to which, by original or later
adjournment, the meeting may be adjourned. Shareholders of record at the
close of business on February 24, 1997 are entitled to notice of and to vote
at the meeting and any adjournments or postponements thereof.
You are requested to complete and sign the enclosed form of proxy, which
is solicited by the Board of Directors, and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend the meeting and
vote in person.
BY ORDER OF THE BOARD OF DIRECTORS
DAVID L. JOBE
SECRETARY
Jefferson City, Missouri
March 19, 1997
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES.
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PROXY STATEMENT
OF
CNS BANCORP, INC.
427 Monroe Street
Jefferson City, Missouri 65101
ANNUAL MEETING OF SHAREHOLDERS
April 22, 1997
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of CNS Bancorp, Inc. ("Company"), the
holding company for City National Savings Bank, FSB (the "Savings Bank"), to
be used at the Annual Meeting of Shareholders of the Company. The Annual
Meeting will be held at the Company's main office at 427 Monroe Street,
Jefferson City, Missouri on Tuesday, April 22, 1997, at 10:00 a.m., local
time. This Proxy Statement and the enclosed proxy card are being first mailed
to shareholders on or about March 19, 1997.
VOTING AND PROXY PROCEDURE
Shareholders Entitled to Vote. Shareholders of record as of the close of
business on February 24, 1997 are entitled to one vote for each share of
common stock ("Common Stock") of the Company then held. As of February 24,
1997, the Company had 1,653,125 shares of Common Stock issued and outstanding.
Quorum. The presence, in person or by proxy, of at least a majority of
the total number of outstanding shares of Common Stock entitled to vote is
necessary to constitute a quorum at the Annual Meeting. Abstentions will be
counted as shares present and entitled to vote at the Annual Meeting for
purposes of determining the existence of a quorum. Broker non-votes will not
be considered shares present and will not be included in determining whether a
quorum is present.
Voting. The Board of Directors solicits proxies so that each shareholder
has the opportunity to vote on the proposals to be considered at the Annual
Meeting. When a proxy card is returned properly signed and dated the shares
represented thereby will be voted in accordance with the instructions on the
proxy card. Where no instructions are indicated, proxies will be voted FOR
the nominees for directors set forth below, FOR adoption of the CNS Bancorp,
Inc. 1997 Stock Option Plan and FOR adoption of the CNS Bancorp, Inc. 1997
Management Recognition and Development Plan. If a shareholder attends the
Annual Meeting, he or she may vote by ballot.
The three directors to be elected at the Annual Meeting will be elected
by a plurality of the votes cast by shareholders present in person or by proxy
and entitled to vote. Shareholders are not permitted to cumulate their votes
for the election of directors. With respect to the election of directors,
votes may be cast for or withheld from each nominee. Votes that are withheld
and broker non-votes will have no effect on the outcome of the election
because directors will be elected by a plurality of votes cast. With respect
to the other proposals to be voted upon, shareholders may vote for a proposal,
against a proposal or may abstain from voting. Adoption of the 1997 Stock
Option Plan and the 1997 Management Recognition and Development Plan will
require the affirmative vote of a majority of the outstanding shares. Thus,
abstentions and broker non-votes will have the same effect as a vote against
adoption of the Stock Option Plan and the Management Recognition and
Development Plan.
Revocation of a Proxy. Shareholders who execute proxies retain the right
to revoke them at any time. Proxies may be revoked by written notice
delivered in person or mailed to the Secretary of the Company or by filing a
later proxy prior to a vote being taken on a particular proposal at the Annual
Meeting. Attendance
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at the Annual Meeting will not automatically revoke a proxy, but a shareholder
in attendance may request a ballot and vote in person, thereby revoking a
prior granted proxy.
Participants in the Savings Bank's ESOP. If a shareholder is a
participant in the City National Savings Bank, FSB Employee Stock Ownership
Plan (the "ESOP"), the proxy card represents a voting instruction to the
trustees of the ESOP as to the number of shares in the participant's plan
account. Each participant in the ESOP may direct the trustees as to the
manner in which shares of Common Stock allocated to the participant's plan
account are to be voted. Unallocated shares of Common Stock held by the ESOP
and allocated shares for which no voting instructions are received will be
voted by the trustees in the same proportion as shares for which the trustees
have received voting instructions.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Persons and groups who beneficially own in excess of 5% of the Company's
Common Stock are required to file certain reports disclosing such ownership
pursuant to the Securities Exchange Act of 1934, as amended ("Exchange Act").
Based on such reports, the following table sets forth, as of February 24,
1997, certain information as to those persons who were beneficial owners of
more than 5% of the outstanding shares of Common Stock. Management knows of
no persons other than those set forth below who beneficially owned more than
5% of the outstanding shares of Common Stock at February 24, 1997. The
following table also sets forth, as of February 24, 1997, information as to
the shares of Common Stock beneficially owned by each director, by the Chief
Executive Officer of the Company and by all executive officers and directors
of the Company as a group.
Number of Shares Percent of Shares
Beneficial Owner Beneficially Owned (1) Outstanding
- ---------------- ---------------------- -----------
Beneficial Owners of More Than 5%
City National Savings Bank, FSB 132,250 8.0%
Employee Stock Ownership Plan Trust
Directors
Richard E. Caplinger 16,000 *
Robert E. Chiles** 16,183 *
Michael A. Dallmeyer 10,000 *
John C. Kolb 10,000(2) *
James F. McHenry 15,000 *
Ronald D. Roberson 18,900 1.1
James E. Whaley 15,000 *
All Executive Officers and 129,456 7.8
Directors as a Group
(9 persons)
_______________
* Less than 1% of shares outstanding.
** Mr. Chiles is also Chief Executive Officer of the Company.
(1) In accordance with Rule 13d-3 under the Exchange Act, a person is deemed
to be the beneficial owner, for purposes of this table, of any shares of
Common Stock if he or she has voting or investment power with respect to
such security. The table includes shares owned by spouses, other
immediate family members in trust, shares held in retirement accounts or
funds for the benefit of the
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named individuals, and other forms of ownership, over which shares the
persons named in the table may possess voting and/or investment power.
Shares held in accounts under the Savings Bank's ESOP, as to which the
holders have voting power but not investment power, are included as
follows: Mr. Chiles, 1,183 shares; all executive officers and directors as
a group, 2,606 shares.
(2) Includes 5,000 shares owned by Mr. Kolb's children and 5,000 shares owned
by Mr. Kolb's spouse.
PROPOSAL I -- ELECTION OF DIRECTORS
The Company's Board of Directors consists of seven members. The Board of
Directors is divided into three classes with three-year staggered terms, with
approximately one third of the directors elected each year. Three directors
will be elected at the Annual Meeting to serve for a three-year period, or
until their respective successors have been elected and qualified. The
nominees for election this year are James F. McHenry, James E. Whaley and
Ronald D. Roberson. The nominees are current members of the Boards of
Directors of the Company and the Savings Bank.
It is intended that the proxies solicited by the Board of Directors will
be voted for the election of the above named nominees. If any nominee is
unable to serve, the shares represented by all valid proxies will be voted for
the election of such substitute as the Board of Directors may recommend or the
Board of Directors may adopt a resolution to amend the Bylaws and reduce the
size of the Board. At this time the Board of Directors knows of no reason why
any nominee might be unable to serve.
The Board of Directors recommends a vote "FOR" the election of Messrs.
McHenry, Whaley and Roberson.
The following table sets forth certain information regarding the nominees
for election at the Annual Meeting, as well as information regarding those
directors continuing in office after the Annual Meeting.
Year First
Elected Term to
Name Age (1) Director (2) Expire
- ------------------ -------- ------------ -------
BOARD NOMINEES
James F. McHenry 66 1964 2000(3)
James E. Whaley 60 1975 2000(3)
Ronald D. Roberson 58 1983 2000(3)
DIRECTORS CONTINUING IN OFFICE
Richard E. Caplinger 63 1975 1998
Michael A. Dallmeyer 44 1994 1998
Robert E. Chiles 61 1967 1999
John C. Kolb 48 1989 1999
______________
(1) As of December 31, 1996.
(2) Includes prior service on the Board of Directors of the Savings Bank.
(3) Assuming the individual is re-elected.
The present principal occupation and other business experience during the last
five years of each nominee for election and each director continuing in office
is set forth below:
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Robert E. Chiles serves as President and Chief Executive Officer of the
Savings Bank, positions he has held since 1974. Mr. Chiles has also served as
President and Chief Executive Officer of the Company since its formation in
1996. Mr. Chiles is currently a member of the Loan Review Committee, the
Planning Committee, the Investment Committee and the In-House Loan Committee.
Mr. Chiles served as a member of the FHLB-Des Moines Board from 1989 to 1994
and as Vice Chairman in 1994.
James F. McHenry is a retired Circuit Court Judge for Cole County. Mr.
McHenry is currently a member of the Budget and Salary Committee.
James E. Whaley is the majority owner of Whaley's East End Drug, a retail
pharmacy in Jefferson City. He is currently a member of the Loan Review
Committee, the Planning Committee, and the Budget and Salary Committee. Mr.
Whaley is also a member of the Jefferson City Rotary.
Ronald D. Roberson is the sole owner of R.D. Roberson & Associates, a
financial and management consulting firm that he founded in 1990. He
previously served as President of the Missouri Chamber of Commerce from 1974
to 1990. Mr. Roberson currently serves on the Loan Review Committee and the
Investment Committee.
Richard E. Caplinger is co-owner of Caplinger's Inc., a mens' specialty
retailer, with which he has been associated since 1952. Mr. Caplinger has
served as Chairman of the Board of Directors of the Savings Bank since 1993
and as Chairman of the Company since its formation in 1996. He currently
serves on the Planning Committee, the Budget and Salary Committee and the
Compliance Committee. Mr. Caplinger is also chairman of the Jefferson City
Community Betterment Association and a member of the small business task force
of the Jefferson City Chamber of Commerce.
Michael A. Dallmeyer is a partner in the law firm of Hendren and Andrae,
Jefferson City, Missouri, with which he has been associated since 1977. He is
currently a member of the Insurance Committee and the Compliance Committee.
John C. Kolb is the President and part-owner of Jefferson City Oil Co.,
Inc., an oil and fuel distributor with which he has been associated since
1973. He is currently a member of the Loan Review Committee, the Insurance
Committee and the Planning Committee. Mr. Kolb is also a member of the
Jefferson City Chamber of Commerce Committee of 50 and of the Helias High
School Foundation Board.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Boards of Directors of the Company and the Savings Bank conduct their
business through meetings of the Boards and through their committees. During
the fiscal year ended December 31, 1996, the Board of Directors of the Company
held one meeting in connection with its initial organization and four
subsequent meetings, and the Board of Directors of the Savings Bank held 15
meetings. No director of the Company or the Savings Bank attended fewer than
75% of the total meetings of the Boards and committees on which such person
served during this period.
The entire Board of Directors of the Company serves as the Audit
Committee and meets with the Company's outside auditor to discuss the results
of the annual audit and any related matters. The Audit Committee, including
meetings of the Savings Bank's Audit Committee prior to the completion of the
Savings Bank's mutual to stock conversion, met one time during the fiscal year
ended December 31, 1996.
The Budget and Salary Committee, consisting of Directors McHenry
(Chairman), Whaley and Caplinger, is responsible for reviewing and approving
the annual operating budget and business plan of the Company. The Budget and
Salary Committee establishes the overall compensation budget and establishes
the
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compensation for the executive officers. The Budget and Salary Committee met
two times during the fiscal year ended December 31, 1996.
The Board of Directors of the Company acts as a nominating committee for
selecting the nominees for election as directors. The Board of Directors met
once in its capacity as nominating committee to select nominees for election
at the Annual Meeting.
DIRECTORS' COMPENSATION
Directors of the Savings Bank currently receive a monthly retainer of
$1,000. Directors may participate in the Savings Bank's medical and dental
insurance plans at their own expense. No separate fees are paid for service
on the Board of Directors of the Company.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following information is furnished for the Chief Executive Officer of
the Company. No other executive officers of the Company or the Savings Bank
received salary and bonus in excess of $100,000 during the year ended December
31, 1996.
Annual Compensation(1)
___________________________________________________________
Name and Other Annual All Other
Position Year Salary($) Bonus($) Compensation($)(3) Compensation($)
---- --------- -------- --------------- ---------------
Robert E. Chiles 1996 105,600(2) 100 -- 17,900(4)
Chief Executive 1995 92,400 7,000 -- --
Officer and
President
_________________
(1) Compensation information for the fiscal year ended December 31, 1994 has
been omitted as the Company was not a public company nor a subsidiary
thereof at such time.
(2) Includes directors fees of $12,000.
(3) Does not include perquisites which did not exceed the lesser of $50,000
or 10% of salary and bonus.
(4) Consists of employer contributions to ESOP.
Employment Agreements
On June 11, 1996, the Company and the Savings Bank (collectively, the
"Employers") entered into a three- year employment agreement with Mr. Chiles.
Mr. Chiles base salary under the agreement currently is $93,600, which amount
is paid by the Savings Bank and may be increased at the discretion of the
Board of Directors or an authorized committee of the Board. On each
anniversary of the commencement date of the agreement, the term of the
agreement may be extended for an additional year. The agreement is terminable
by the Employers at any time or upon the occurrence of certain events
specified by federal regulations.
The employment agreement provides for severance payments and other
benefits in the event of involuntary termination of employment in connection
with any change in control of the Employers. Severance payments also will be
provided on a similar basis in connection with a voluntary termination of
employment where, subsequent to a change in control, Mr. Chiles is assigned
duties inconsistent with his position, duties,
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responsibilities and status immediately prior to such change in control. The
term "change in control" is defined in the agreement as having occurred when,
among other things, (a) a person other than the Company purchases shares of
Common Stock pursuant to a tender or exchange offer for such shares, (b) any
person (as such term is used in Sections 13(d) and 14(d)(2) of the Exchange
Act) is or becomes the beneficial owner, directly or indirectly, of securities
of the Company representing 25% or more of the combined voting power of the
Company's then outstanding securities, (c) the membership of the Board of
Directors changes as the result of a contested election, or (d) shareholders
of the Company approve a merger, consolidation, sale or disposition of all or
substantially all of the Company's assets, or a plan of partial or complete
liquidation.
The severance payment from the Employers will equal 2.99 times Mr.
Chiles' average annual compensation during the five-year period preceding the
change in control. Such amount will be paid in a lump sum within ten business
days following the termination of employment. Assuming that a change in
control had occurred at December 31, 1996, Mr. Chiles would be entitled to a
severance payment of approximately $289,000. Section 280G of the Internal
Revenue Code of 1986, as amended ("Code"), states that severance payments
which equal or exceed three times the base compensation of the individual are
deemed to be "excess parachute payments" if they are contingent upon a change
in control. Individuals receiving excess parachute payments are subject to a
20% excise tax on the amount of such excess payments, and the Employers would
not be entitled to deduct the amount of such excess payments.
The agreement restricts Mr. Chiles' right to compete against the
Employers for a period of one year from the date of termination of the
agreement if Mr. Chiles voluntarily terminates employment, except in the event
of a change in control.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Company's executive
officers and directors, and persons who own more than 10% of any registered
class of the Company's equity securities, to file reports of ownership and
changes in ownership with the Securities and Exchange Commission. Executive
officers, directors and greater than 10% shareholders are required by
regulation to furnish the Company with copies of all Section 16(a) forms they
file.
Based solely on its review of the copies of such forms it has received
and written representations provided to the Company by the above referenced
persons, the Company believes that, during the fiscal year ended December 31,
1996, all filing requirements applicable to its reporting officers, directors
and greater than 10% shareholders were properly and timely complied with.
TRANSACTIONS WITH MANAGEMENT
As required by federal regulations, all loans or extensions by the
Savings Bank of credit to executive officers and directors are made on
substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons
and do not involve more than the normal risk of repayment or present other
unfavorable features. In addition, loans made by the Savings Bank to a
director or executive officer in an amount that, when aggregated with the
amount of all other loans by the Savings Bank to such person and his or her
related interests, are in excess of the greater of $25,000 or 5% of the
Savings Bank's capital and surplus (up to a maximum of $500,000) are subject
to approval in advance by a majority of the disinterested members of the Board
of Directors.
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PROPOSAL II -- RATIFICATION OF 1997 STOCK OPTION PLAN
The Company's Board of Directors adopted the CNS Bancorp, Inc. 1997 Stock
Option Plan ("Option Plan") on February 18, 1997, subject to approval by the
Company's shareholders. Assuming shareholder approval, the Option Plan will
be effective on June 12, 1997. By postponing the effective date, the Option
Plan will not be subjected to certain regulatory restrictions otherwise
applicable to plans implemented prior to the first anniversary of the Savings
Bank's mutual to stock conversion. The following description of the Option
Plan is qualified in its entirety by reference to the complete text of the
Option Plan, which is attached to this Proxy Statement as Exhibit A.
Administration of the Option Plan
The Option Plan is administered by a committee of the Board of Directors
(the "Committee"). The Committee consists of not less than two non-employee
members of the Board of Directors. In addition to determining who will be
granted options, the Committee has the authority and discretion to determine
when options will be granted and the number of options to be granted. In
making such determination, the Committee will consider those non-employee
directors, officers and employees who are expected to make significant
contributions to the long-term success of the Company and the Savings Bank.
With respect to awards to officers and employees, the Committee also
determines which options are intended to qualify for special treatment under
the Code ("Incentive Stock Options") or to be issued as options which are not
intended to so qualify ("Non-Qualified Stock Options"). The Option Plan
provides that all options granted to non-employee directors are Non-Qualified
Stock Options.
The Option Plan provides that (i) no officer or employee will receive an
award of stock options covering in excess of 25% of the number of shares
reserved for issuance under the Option Plan, (ii) no non-employee director
will receive an award of stock options covering in excess of 5% of the number
of shares reserved for issuance under the Option Plan and (iii) non-employee
directors serving as of the date of shareholder approval will not receive
awards of stock options covering in excess of 30% in the aggregate of the
number of shares reserved for issuance under the Option Plan.
The Board may from time to time amend or terminate the Option Plan in any
respect. An amendment to the Option Plan may be subject to shareholder
approval if such approval is necessary to comply with any tax or regulatory
requirement. No amendment or termination may retroactively impair the rights
of any person with respect to an option.
Shares Subject to the Option Plan
The Company has reserved an aggregate of 165,313 shares of the Company's
Common Stock for issuance pursuant to the exercise of stock options, which may
be granted to officers, employees and non-employee directors. Such shares may
be treasury shares or authorized but unissued shares. The use of authorized
but unissued shares may dilute the interests of existing shareholders.
In the event of a merger, consolidation, sale of all or substantially all
of the property of the Company, reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or other
distribution, an appropriate and proportionate adjustment shall be made in (i)
the maximum number of shares available, (ii) the number and kind of shares
subject to outstanding options, if any, and (iii) the price for each share.
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Option Price
The exercise price of Non-Qualified Stock Options and Incentive Stock
Options may not be less than 100% of the fair market value of the shares of
Common Stock of the Company on the date of grant. Any Incentive Stock Option
granted to a person owning more than 10% of the Company's outstanding Common
Stock must have an exercise price of at least 110% of fair market value on the
date of grant. The maximum aggregate fair market value (determined as of the
date of grant) of the shares to which Incentive Stock Options held by an
individual become exercisable for the first time during any calendar year may
not exceed $100,000.
Terms of Options
In general, the Committee has the discretion to fix the term of each
option granted to an officer or employee under the Option Plan, except that
the maximum term of each option is ten years, subject to earlier termination
as provided in the Option Plan (five years in the case of Incentive Stock
Options granted to an employee who owns over 10% of the total combined voting
power of all classes of the Company's stock). The Option Plan provides that
all awards under the Option Plan will become exercisable in equal installments
over a five-year period following the date of grant. However, unvested
options will become immediately exercisable in the event of the option
holder's death or disability, or upon a change in control (as defined in the
Option Plan) of the Company or the Savings Bank.
Except in limited circumstances, an option may not be transferred other
than by will or by laws of descent and distribution and, during the lifetime
of the option holder, may be exercised only by such holder. If any option
expires or terminates for any reason without having been exercised in full,
the unpurchased shares subject to such option will be available again for
purposes of the Option Plan.
Federal Income Tax Consequences of Non-Qualified Options
An option holder who is granted a Non-Qualified Stock Option under the
Option Plan will not realize any income for Federal income tax purposes on the
grant of an option. An option holder will realize ordinary income for Federal
income tax purposes on the exercise of an option, provided the shares are not
then subject to a substantial risk of forfeiture within the meaning of Section
83 of the Code ("Risk of Forfeiture"), in an amount equal to the excess, if
any, of the fair market value of the shares of Common Stock on the date of
exercise over the exercise price thereof. If the shares are subject to a Risk
of Forfeiture on the date of exercise, the option holder will realize ordinary
income for the year in which the shares cease to be subject to a Risk of
Forfeiture in an amount equal to the excess, if any, of the fair market value
of the shares at the date they cease to be subject to a Risk of Forfeiture
over the exercise price, unless the option holder shall have made a timely
election under Section 83 of the Code to include in his or her income for the
year of exercise an amount equal to the excess of the fair market value of the
shares of Common Stock on the date of exercise over the exercise price. The
amount realized for tax purposes by an option holder by reason of the exercise
of a Non-Qualified Stock Option granted under the Option Plan is subject to
withholding by the Company and the Company is entitled to a deduction in an
amount equal to the income so realized by an option holder, provided all
necessary withholding requirements under the Code are met.
Provided that the option holder satisfies certain holding period
requirements provided by the Code, an employee will realize long-term capital
gain or loss, as the case may be, if the shares issued upon exercise of a Non-
Qualified Stock Option are disposed of more than one year after (i) the shares
are transferred to the employee or (ii) if the shares were subject to a Risk
of Forfeiture on the date of exercise and a valid election under Section 83 of
the Code shall not have been made, the date as of which the shares cease to be
subject to a Risk of Forfeiture. The amount recognized upon such disposition
will be the difference between the option holder's basis in such shares and
the amount realized upon such disposition. Generally, an option holder's
basis in the shares will be equal to the exercise price plus the amount of
income recognized upon exercise of the option.
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Federal Income Tax Consequences of Incentive Stock Options
An Incentive Stock Option holder who meets the eligibility requirements
of Section 422 of the Code will not realize income for Federal income tax
purposes, and the Company will not be entitled to a deduction, on either the
grant or the exercise of an Incentive Stock Option. If the Incentive Stock
Option holder does not dispose of the shares acquired within two years after
the date the Incentive Stock Option was granted to him or her or within one
year after the transfer of the shares to him or her, (i) any proceeds realized
on a sale of such shares in excess of the option price will be treated as
long-term capital gain and (ii) the Company will not be entitled to any
deduction for Federal income tax purposes with respect to such shares.
If an Incentive Stock Option holder disposes of shares during the
two-year or one-year periods referred to above (a "Disqualifying
Disposition"), the Incentive Stock Option holder will not be entitled to the
favorable tax treatment afforded to incentive stock options under the Code.
Instead, the Incentive Stock Option holder will realize ordinary income for
Federal income tax purposes in the year the Disqualifying Disposition is made,
in an amount equal to the excess, if any, of the fair market value of the
shares of Common Stock on the date of exercise over the exercise price.
An Incentive Stock Option holder generally will recognize long-term
capital gains or loss, as the case may be, if the Disqualifying Disposition is
made more than one year after the shares are transferred to the Incentive
Stock Option holder. The amount of any such gain or loss will be equal to the
difference between the amount realized on the Disqualifying Disposition and
the sum of (x) the exercise price and (y) the ordinary income realized by the
Incentive Stock Option holder as the result of the Disqualifying Disposition.
The Company will be allowed in the taxable year of a Disqualifying
Disposition a deduction in the same amount as the ordinary income recognized
by the Incentive Stock Option holder provided all necessary withholding
requirements are met.
Notwithstanding the foregoing, if the Disqualifying Disposition is made
in a transaction with respect to which a loss (if sustained) would be
recognized to the Incentive Stock Option holder, then the amount of ordinary
income required to be recognized upon the Disqualifying Disposition will not
exceed the amount by which the amount realized from the disposition exceeds
the exercise price. Generally, a loss may be recognized if the transaction is
not a "wash" sale, a gift or a sale between certain persons or entities
classified under the Code as "related persons."
Alternative Minimum Tax
For purposes of computing the alternative minimum tax with respect to
shares acquired pursuant to the exercise of Incentive Stock Options, the
difference between the fair market value of the shares on the date of exercise
over the exercise price will be an item of tax preference in the year of
exercise if the shares are not subject to a Risk of Forfeiture; if the shares
are subject to a Risk of Forfeiture, the amount of the tax preference taken
into account in the year the Risk of Forfeiture ceased will be the excess of
the fair market value of the shares at the date they cease to be subject to a
Risk of Forfeiture over the exercise price. The basis of the shares for
alternative minimum tax purposes, generally, will be an amount equal to the
exercise price, increased by the amount of the tax preference taken into
account in computing the alternative minimum taxable income.
New Plan Benefits
The following table sets forth information regarding the number of
options anticipated to be granted under the Option Plan as of the effective
date of the Option Plan. Each option award specified below will be granted at
100% of the fair market value of the Company's Common Stock on the date of
grant and that each award will become exercisable in equal installments over a
five-year period.
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Name Position Anticipated Stock Option Grant
- ---------------- -------- ------------------------------
Robert E. Chiles President and Chief 33,062
Executive Officer
All executive officers ---- 53,725
as a group (three persons)
All non-employee directors ---- 49,596
(six persons)
The balance of the options that may be granted under the Option Plan are
expected to be allocated in the future to current and prospective non-employee
directors, officers and employees.
Adoption of the Option Plan
Subject to approval by the Company's shareholders, the Board of Directors
adopted the Option Plan to encourage stock ownership by employees and
non-employee directors of the Company and its subsidiaries by issuing options
to purchase shares of the Company's Common Stock, thereby enabling such
directors, officers and employees to acquire or increase their proprietary
interest in the Company and encouraging them to remain in the employ or remain
directors of the Company and its subsidiaries. The Board of Directors has
determined that the Option Plan is desirable, cost effective and produces
incentives that will benefit the Company and its shareholders. Moreover, the
Board of Directors believes that the terms of the Option Plan are consistent
with the terms of similar stock compensation programs implemented by other
recently converted financial institutions in the Company's peer group. The
foregoing Option Plan must be approved by a majority of the outstanding shares
of Common Stock of the Company. The Board of Directors recommends a vote
"FOR" the adoption of the Option Plan attached as Exhibit A.
PROPOSAL III -- RATIFICATION OF THE MANAGEMENT
RECOGNITION AND DEVELOPMENT PLAN
The Board of Directors of the Company adopted the CNS Bancorp, Inc. 1997
Management Recognition and Development Plan ("MRDP") on February 18, 1997 for
the benefit of officers, employees and non-employee directors of the Company
and its subsidiaries. Assuming shareholder approval, the MRDP will be
effective on June 12, 1997. By postponing the effective date, the MRDP will
not be subject to certain regulatory restrictions otherwise applicable to
plans implemented prior to the first anniversary of the Savings Bank's
mutual-to-stock conversion. The following description of the MRDP is
qualified in its entirety by reference to the complete text of the MRDP, which
is attached to this Proxy Statement as Exhibit B.
The purpose of the MRDP is to encourage and provide an additional
incentive to non-employee directors, officers and employees of the Company and
its subsidiaries to increase the value of the Company and its Common Stock by
permitting them to acquire a significant equity interest in the Company. The
MRDP is also intended to assist the Company in retaining superior personnel
and to strengthen their desire to remain as directors or employees of the
Company.
All awards under the MRDP are made by a committee of the Board of
Directors consisting of at least two non-employee directors. The MRDP
provides that (i) no officer or employee will receive an award of restricted
stock covering in excess of 25% of the number of shares reserved for issuance
under the MRDP, (ii) no non- employee director shall receive an award of
restricted stock covering in excess of 5% of the number of shares reserved for
issuance under the MRDP and (iii) non-employee directors serving as of the
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date of shareholder approval will not receive awards of restricted stock
covering in excess of 30% in the aggregate of the number of shares reserved
for issuance under the MRDP.
MRDP awards are made in the form of restricted stock that is subject to
restrictions on transfer of ownership. MRDP awards generally will vest over a
five-year period in equal installments beginning on the first anniversary of
the effective date of the MRDP. If the employee or non-employee director
terminates service for reasons other than death or disability, the employee
or director forfeits all rights to the allocated shares under restriction. If
the employee's or director's termination is caused by death or disability, all
restrictions expire and all shares allocated become unrestricted. MRDP awards
also will become fully vested upon a change in control (as defined in the
MRDP) of the Company or the Savings Bank. Compensation expense in the amount
of the fair market value of the Common Stock at the date of the grant to the
officer or director will be recognized over the period in which the shares
vest. An eligible officer or director will not be entitled to voting and
other shareholder rights with respect to the shares while restricted.
Furthermore, the shares, while restricted, may not be sold, pledged or
otherwise disposed of and dividends paid during the period of restriction will
be held in escrow.
A recipient of an award who receives a grant of restricted stock and does
not elect to be taxed at the time of grant will not recognize income upon an
award of shares of Common Stock, and the Company will not be entitled to a
deduction until the termination of the restrictions. Upon such termination,
the recipient will recognize ordinary income in an amount equal to the fair
market value of the Common Stock at the time (less any amount paid by the
recipient for such shares) and the Company will be entitled to a deduction in
the same amount after satisfying federal income tax withholding requirements.
However, the recipient may elect to recognize ordinary income in the year the
restricted stock is granted in an amount equal to the fair market value of the
shares at that time, determined without regard to the restrictions. In that
event, the Company will be entitled to a deduction in such year and in the
same amount. Any gain or loss recognized by the recipient upon subsequent
disposition of the stock will be capital in nature.
The MRDP may utilize authorized but unissued shares of Common Stock from
the Company in fulfillment of awards. Any such use of shares by the MRDP
could dilute the holdings of the Company's shareholders. The MRDP also may
purchase Common Stock in the open market through a trust established in
connection with the MRDP and funded with contributions from the Company. No
more than 66,125 shares may be issued under the MRDP, subject to adjustment in
the event of a stock dividend, stock split, or similar event. The Board of
Directors can terminate the MRDP at any time, and if it does so, any shares
not allocated will revert to the Company.
New Plan Benefits
The following table sets forth information regarding the number of
restricted shares anticipated to be granted under the MRDP following the
effective date of the MRDP.
Anticipated Restricted
Name Position Stock Grant
- ---------------- -------- ----------------------
Robert E. Chiles President and Chief 16,531
Executive Officer
All executive officers as ---- 29,756
a group (three persons)
All non-employee directors ---- 19,836
(six persons)
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The balance of the shares that may be issued pursuant to the MRDP is
expected to be allocated in the future to current and prospective non-employee
directors, subsidiary directors, officers and employees.
The Board of Directors has determined that the MRDP is desirable and will
produce incentives for management that will benefit the Company and its
shareholders. The Board of Directors believes that the MRDP will be a
significant factor in aligning the interests of management with those of
shareholders and that the terms of the MRDP are consistent with the terms of
similar stock compensation programs implemented by other recently converted
financial institutions in the Company's peer group. The MRDP must be approved
by a majority of the outstanding shares of Common Stock of the Company. The
Board of Directors recommends a vote "FOR" the adoption of the MRDP attached
as Exhibit B.
AUDITORS
The Board of Directors has appointed Williams-Keepers, LLP, independent
public accountants, to serve as the Company's auditors for the fiscal year
ending December 31, 1997. A representative of Williams-Keepers, LLP is
expected to be present at the Annual Meeting to respond to appropriate
questions from shareholders and will have the opportunity to make a statement
if he or she so desires.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Annual Meeting other than those matters described above in this Proxy
Statement. However, if any other matters should properly come before the
Annual Meeting, it is intended that proxies in the accompanying form will be
voted in respect thereof in accordance with the judgment of the person or
persons voting the proxies.
MISCELLANEOUS
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy
materials to the beneficial owners of the Common Stock. In addition to
solicitations by mail, directors, officers and regular employees of the
Company may solicit proxies personally or by telecopier or telephone without
additional compensation. The Company has retained Regan & Associates, Inc. to
assist in soliciting proxies of shareholders whose shares are held in street
name by brokers, banks and other institutions at a cost of $3,500 plus
expenses up to $1,750.
The Company's 1996 Annual Report to Shareholders, including financial
statements, has been mailed to all shareholders of record as of the close of
business on February 24, 1997. Any shareholder who has not received a copy of
such annual report may obtain a copy by writing to the Company. The Annual
Report is not to be treated as part of the proxy solicitation material or as
having been incorporated herein by reference.
A copy of the Company's Form 10-KSB for the fiscal year ended December
31, 1996, as filed with the Securities and Exchange Commission, will be
furnished without charge to shareholders of record as of February 24, 1997
upon written request to David L. Jobe, Corporate Secretary, CNS Bancorp, Inc.,
427 Monroe Street, Jefferson City, Missouri 65101.
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SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the Company's
annual meeting expected to be held in April 1998 must be received by the
Company no later than November 19, 1997 to be considered for inclusion in the
proxy materials and form of proxy relating to such meeting. Any such
proposals shall be subject to the requirements of the proxy rules adopted
under the Exchange Act.
The Company's Certificate of Incorporation provides that in order for a
shareholder to make nominations for the election of directors or proposals for
business to be brought before the Annual Meeting, a shareholder must deliver
notice of such nominations and/or proposals to the Secretary not less than 30
nor more than 60 days prior to the date of the Annual Meeting; provided that
if less than 31 days' notice of the Annual Meeting is given to shareholders,
such notice must be delivered not later than the close of the tenth day
following the day on which notice of the Annual Meeting was mailed to
shareholders. As specified in the Certificate of Incorporation, the notice
with respect to nominations for election of directors must set forth certain
information regarding each nominee for election as a director, including such
person's written consent to being named in the proxy statement as a nominee
and to serving as a director, if elected, and certain information regarding
the shareholder giving such notice. The notice with respect to business
proposals to be brought before the Annual Meeting must state the shareholder's
name, address and number of shares of Common Stock held, and briefly discuss
the business to be brought before the Annual Meeting, the reasons for
conducting such business at the Annual Meeting and any interest of the
shareholder in the proposal.
BY ORDER OF THE BOARD OF DIRECTORS
DAVID L. JOBE
SECRETARY
Jefferson City, Missouri
March 19, 1997
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EXHIBIT A
CNS Bancorp, Inc.
1997 Stock Option Plan
SECTION 1. Purpose. The purposes of the CNS Bancorp, Inc. 1997 Stock Option
Plan are to promote the interests of the Company, its affiliates, and its
stockholders by (i) attracting and retaining exceptional executive personnel
and other key employees and directors of the Company and its affiliates; (ii)
motivating such employees and Eligible Directors by means of performance-
related incentives to achieve longer-range performance goals; and (iii)
enabling such employees and Eligible Directors to participate in the long-term
growth and financial success of the Company.
SECTION 2. Definitions. As used in the Plan, the following terms shall have
the meanings set forth below:
"Affiliate" shall mean the Bank and any other "subsidiary" of the Company as
defined in Section 424(f) of the Code.
"Award" shall mean any grant of Options or Director Options.
"Award Agreement" shall mean any written agreement, contract, or other
instrument or document evidencing any Award, which may, but need not, be
executed or acknowledged by a Participant.
"Bank" shall mean City National Savings Bank, FSB, Jefferson City, Missouri,
or any successor thereto.
"Board" shall mean the Board of Directors of the Company.
"Change in Control" shall mean an event deemed to occur if and when (a) an
offeror other than the Company purchases shares of the common stock of the
Company or the Bank pursuant to a tender or exchange offer for such shares,
(b) any person (as such term is used in Sections 13(d) and 14(d)(2) of the
Exchange Act) is or becomes the beneficial owner, directly or indirectly, of
securities of the Company or the Bank representing twenty-five percent (25%)
or more of the combined voting power of the Company's or the Bank's then
outstanding securities, (c) the membership of the board of directors of the
Company or the Bank changes as the result of a contested election, such that
individuals who were directors at the beginning of any twenty-four (24) month
period (whether commencing before or after the date of adoption of this Plan)
do not constitute a majority of the Board at the end of such period, or (d)
shareholders of the Company or the Bank approve a merger, consolidation, sale
or disposition of all or substantially all of the Company's or the Bank's
assets, or a plan of partial or complete liquidation. If any of the events
enumerated in clauses (a) - (d) occur, the Board shall determine the effective
date of the change in control resulting therefrom, for purposes of the Plan.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Committee" shall mean a committee of the Board consisting of at least two
non-employee directors designated by the Board to administer the Plan. If a
separate committee is not so designated, the Board shall serve as the
Committee for all purposes under the Plan.
"Company" shall mean CNS Bancorp, Inc., a Delaware corporation.
"Director Option" shall mean a Non-Qualified Stock Option granted to an
Eligible Director pursuant to Section 6(e).
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"Disability" shall have the meaning set forth in Section 22(e)(3) of the Code.
For purposes of the Plan, all determinations as to whether a Participant has
become disabled shall be made by a majority of the Board upon the basis of
such evidence as it deems necessary or desirable, and shall be final and
binding on all interested persons.
"Effective Date" shall mean the date specified in Section 9(a) of the Plan.
"Eligible Director" shall mean, on any date, a person who is serving as a
member of the Board but shall not include a person who is an Employee.
"Employee" shall mean an employee of the Company or any Affiliate.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Fair Market Value" shall be determined as follows:
(a) If the Shares are traded or quoted on the Nasdaq Stock Market or other
national securities exchange at the time of grant of the Award, then the Fair
Market Value shall be the average of the highest and lowest selling price on
such exchange on the date such Award is granted or, if there were no sales on
such date, then on the next prior business day on which there was a sale.
(b) If the Shares are not traded or quoted on the Nasdaq Stock Market or
other national securities exchange, then the Fair Market Value shall be a
value determined by the Committee in good faith on such basis as it deems
appropriate.
"Incentive Stock Option" shall mean a right to purchase Shares from the
Company that is granted under Section 6 of the Plan and that is intended to
meet the requirements of Section 422 of the Code or any successor provision
thereto.
"Non-Qualified Stock Option" shall mean a right to purchase Shares from the
Company that is granted under Section 6 of the Plan and that is not intended
to be an Incentive Stock Option.
"Option" shall mean an Incentive Stock Option or a Non-Qualified Stock Option
but shall not include a Director Option.
"Participant" shall mean any Employee or Eligible Director selected by the
Committee to receive an Award of Options or Director Options, as appropriate.
"Person" shall mean any individual, corporation, partnership, association,
joint-stock company, trust, unincorporated organization, government or
political subdivision thereof or other entity.
"Plan" shall mean the CNS Bancorp, Inc. 1997 Stock Option Plan.
"Rule 16b-3" shall mean Rule 16b-3 as promulgated and interpreted by the SEC
under the Exchange Act, or any successor rule or regulation thereto as in
effect from time to time.
"SEC" shall mean the Securities and Exchange Commission or any successor
thereto and shall include the staff thereof.
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"Shares" shall mean common shares of the Company, or such other securities of
the Company as may be designated by the Committee from time to time.
"Ten Percent Stockholder" shall mean any stockholder who, at the time an
Incentive Stock Option is granted to such stockholder, owns (within the
meaning of Section 424(d) of the Code) more than ten percent (10%) of the
voting power of all classes of stock of the Company.
"Termination for Cause" shall mean termination because of a Participant's
personal dishonesty, incompetence, willful misconduct, breach of fiduciary
duty involving personal profit, intentional failure to perform stated duties,
willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or material breach of any provision of any
employment agreement between the Company and/or, the Bank and a Participant.
SECTION 3. Administration.
(a) The Plan shall be administered by the Committee. Subject to the terms of
the Plan and applicable law, and in addition to other express powers and
authorizations conferred on the Committee by the Plan, the Committee shall:
(i) designate Participants; (ii) determine the type or types of Awards to be
granted to an eligible Employee; (iii) determine the number of Shares to be
covered by, or with respect to which payments, rights, or other matters are to
be calculated in connection with, Awards; (iv) determine the terms and
conditions of any Award; (v) determine whether, to what extent, and under what
circumstances Awards may be settled or exercised in cash, Shares, other
securities, other Awards or other property, or canceled, forfeited, or
suspended; (vi) determine whether, to what extent, and under what
circumstances cash, Shares, other securities, other Awards, other property,
and other amounts payable with respect to an Award shall be deferred either
automatically or at the election of the holder thereof or of the Committee;
(vii) interpret and administer the Plan and any instrument or agreement
relating to, or Award made under, the Plan; (viii) establish, amend, suspend,
or waive such rules and regulations and appoint such agents as it shall deem
appropriate for the proper administration of the Plan; and (ix) make any other
determination and take any other action that the Committee deems necessary or
desirable for the administration of the Plan.
(b) Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations, and other decisions under or with respect to
the Plan or any Award shall be within the sole discretion of the Committee,
may be made at any time and shall be final, conclusive, and binding upon all
Persons, including the Company, and Participant, any holder or beneficiary of
any Award, any shareholder and any Employee.
SECTION 4. Shares Available for Awards.
(a) Shares Available. Subject to adjustment as provided in Section 4(b), the
number of Shares with respect to which Options and Director Options may be
granted under the Plan shall be 165,313. If, after the effective date of the
Plan, any Shares covered by an Option or Director Option granted under the
Plan, or to which such an Option or Director Option relates, are forfeited, or
if an Option or Director Option otherwise terminates or is canceled without
the delivery of Shares, then the Shares covered by such Option or Director
Option, or to which such Option or Director Option relates, or the number of
Shares otherwise counted against the aggregate number of Shares with respect
to which Options and Director Options may be granted, to the extent of any
such settlement, forfeiture, termination or cancellation, shall again be, or
shall become, Shares with respect to which Options and Director Options may be
granted. In the event that any Option or Director Option is exercised through
the delivery of Shares, the number of Shares available for Awards under the
Plan shall be increased by the number of Shares surrendered.
(b) Adjustments. In the event that any dividend or other distribution
(whether in the form of cash, Shares, other securities, or other property),
recapitalization, stock split, reverse stock split, reorganization,
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merger, consolidation, split-up, spin-off, combination, repurchase, or
exchange of Shares or other securities of the Company, issuance of warrants or
other rights to purchase Shares or other securities of the Company, or other
similar corporate transaction or event affects the Shares such that an
adjustment is necessary in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the Plan,
then the Committee shall proportionately adjust any or all (as necessary) of
(i) the number of Shares or other securities of the Company (or number and
kind of other securities or property) with respect to which Awards may be
granted, (ii) the number of Shares or other securities of the Company (or
number and kind of other securities or property) subject to outstanding
Awards, and (iii) the grant or exercise price with respect to any Award;
provided, in each case, that with respect to Awards of Incentive Stock Options
no such adjustment shall be authorized to the extent that such authority would
cause the Plan to violate Section 422(b)(1) of the Code, as from time to time
amended.
(c) Sources of Shares. Any Shares delivered pursuant to an Option or
Director Option may consist, in whole or in part, of authorized and unissued
Shares or of treasury Shares.
SECTION 5. Eligibility. An Employee, including any officer or
employee-director of the Company, shall be eligible to be designated a
Participant. Each Eligible Director shall be eligible to receive Director
Options in accordance with Section 6(e) hereof.
SECTION 6. Options and Director Options.
(a) Grant. Subject to the provisions of the Plan and the recommendation of
the Board, the Committee shall determine the Employees to whom Options shall
be granted, the number of Shares to be covered by each Option, the option
price therefor and the conditions and limitations applicable to the exercise
of the option. The Committee shall have the authority to grant Incentive
Stock Options, or to grant Non-Qualified Stock Options, or to grant both types
of options. In such case of Incentive Stock Options, the terms and conditions
of such grants shall be subject to and comply with such rules as may be
prescribed by Section 422 of the Code, as from time to time amended, and any
regulations implementing such statute, including without limitation, the
requirements of Code Section 422(d), which limits the aggregate fair market
value of Shares of which Incentive Stock Options are exercisable for the first
time to one hundred thousand dollars ($100,000) per calendar year. Each
provision of the Plan and of each written option agreement relating to an
Option designated an Incentive Stock Option shall be construed so that such
Option qualifies as an Incentive Stock Option, and any provision that cannot
be so construed shall be disregarded.
(b) Exercise Price. The Committee shall establish the exercise price at the
time each Option or Director Option is granted, which price shall not be less
than one hundred percent (100%) of the per Share Fair Market Value on the date
of grant. Notwithstanding any provision contained herein, in the case of an
Incentive Stock Option, the exercise price at the time such Incentive Stock
Option is granted to any Employee who, at the time of such grant, is a Ten
Percent Stockholder, shall not be less than one hundred ten percent (110%) of
the per Share Fair Market Value on the date of grant.
(c) Exercise. Each Option shall be exercisable at such times and subject to
such terms and conditions as the Committee may, in its sole discretion,
specify in the applicable Award Agreement or thereafter; provided, however,
that in the case of an Incentive Stock Option, a Participant may not exercise
such Option as an Incentive Stock Option after the earlier of (i) the date
which is ten (10) years (five (5) years in the case of a Participant who is a
Ten Percent Stockholder) after the date on which such Incentive Stock Option
is granted, or (ii) the date which is three (3) months (twelve (12) months in
the case of a Participant who becomes Disabled, or who dies) after the date on
which he ceases to be an employee of the Company or an Affiliate; provided,
further, that no Award of Options under the Plan shall vest more rapidly than
ratably over a five (5) year period whereby twenty percent (20%) of the Award
shall become exercisable on each of the first through the fifth anniversaries
of the date of grant so long as the Participant remains an Employee of the
Company or an Affiliate; provided, further, that an Award of Options shall be
one hundred percent
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(100%) vested upon a Participant's death or Disability. In the event of an
Employee's Termination for Cause, his Options shall be canceled on the date he
ceases to be an Employee. The Committee may impose such conditions with
respect to the exercise of Options, including without limitation, any relating
to the application of federal or state securities laws, as it may deem
necessary or advisable.
(d) Payment. No Shares shall be delivered pursuant to any exercise of an
Option or Director Option until payment in full of the option price therefor
is received by the Company. Such payment may be made in cash or its
equivalent, or, if and to the extent permitted by the Committee, by exchanging
Shares owned by the optionee (which are not the subject of any pledge or other
security interest), or by a combination of the foregoing, provided that the
combined value of all cash and cash equivalents and the Fair Market Value of
any such Shares so tendered to the Company as of the date of such tender is at
least equal to such option price. The Committee may, in its discretion,
arrange procedures for the payment of the exercise price with one or more
stock brokerage firms for the purpose of allowing a Participant to make a
"cashless exercise" of an Option or Director Option.
(e) Director Options. Subject to the provisions of the Plan and the
recommendation of the Board, the Committee shall determine the Eligible
Directors to whom Director Options shall be granted, the number of shares to
be covered by each Director Option and the condition and limitations
applicable to the exercise of each Director Option. Each Award of Director
Options shall vest ratably over a five (5) year period whereby twenty percent
(20%) of the Award shall vest on each of the first through the fifth
anniversaries of the date of grant so long as the Eligible Director continues
to serve as a member of the Board; provided, however, that the Award shall be
one hundred percent (100%) vested in the event of the Eligible Director's
death or Disability. A Director Option shall be exercisable until the earlier
to occur of the following two (2) dates (i) the tenth anniversary of the date
of grant of such Director Option or (ii) one (1) year (two (2) years in the
case of an Eligible Director who becomes Disabled, or who dies) after the date
the Eligible Director ceases to be a member of the Board, except that if the
Eligible Director ceases to be a member of the Board upon Termination for
Cause, his Director Option shall be canceled on the date he ceases to be a
member of the Board. An Eligible Director may pay the exercise price of a
Director Option in the manner described in Section 6(d).
(f) Effect of a Change in Control. In the event of a Change in Control, all
then outstanding Options and Director Options, shall become one hundred
percent (100%) vested and exercisable as of the effective date of the Change
in Control. If, in connection with or as a consequence of a Change in
Control, the Company or the Bank is merged into or consolidated with another
corporation, or if the Company or the Bank sells or otherwise disposes of
substantially all of its assets to another corporation, then unless provisions
are made in connection with such transaction for the continuance of the Plan
and/or the assumption or substitution of then outstanding Options and Director
Options with new options covering the stock of the successor corporation, or
parent or subsidiary thereof, with appropriate adjustments as to the number
and kind of shares and prices, such Options or Director Options shall be
canceled as of the effective date of the merger, consolidation, or sale and
the Participant or Eligible Director shall be paid in cash an amount equal to
the difference between the Fair Market Value of the Shares subject to the
Options or Director Options as of the effective date of such corporate event
and the exercise price of the Options or Director Options, as appropriate.
(g) Limitation on Awards. Notwithstanding anything herein to the contrary,
(i) no Employee shall receive an Award covering in excess of twenty five
percent (25%), (ii) no Eligible Director shall receive an Award covering in
excess of five percent (5%) and (iii) Eligible Directors shall not receive
Awards covering in excess of thirty percent (30%) in the aggregate, of the
number of shares reserved for issuance under the Plan.
SECTION 7. Amendment and Termination.
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(a) Amendments to the Plan. The Board may amend, alter, suspend,
discontinue, or terminate the Plan or any portion thereof at any time;
provided that no such amendment, alteration, suspension, discontinuation or
termination shall be made without shareholder approval if such approval is
necessary to comply with any tax or regulatory requirement with which the
Committee deems it necessary or appropriate to comply.
(b) Amendments to Awards. The Committee may waive any conditions or rights
under, amend any terms of, or alter, suspend, discontinue, cancel or
terminate, any Award theretofore granted, prospectively or retroactively;
provided, however, that any such waiver, amendment, alteration, suspension,
discontinuance, cancellation or termination that would impair the rights of
any Participant or any holder or beneficiary of any Award theretofore granted
shall not to that extent be effective without the consent of the affected
Participant, holder or beneficiary.
(c) Cancellation. Any provision of this Plan or any Award Agreement to the
contrary notwithstanding, the Committee may cause any Award of Options granted
hereunder to be canceled in consideration of the granting to the holder of an
alternative Award of Options having a Fair Market Value equal to the Fair
Market Value of such canceled Award.
SECTION 8. General Provisions.
(a) Nontransferability.
(i) Each Award, and each right under any Award, shall be exercisable only by
the Participant during his lifetime, or, if permissible under applicable law,
by the Participant's guardian or legal representative or a transferee
receiving such Award pursuant to a domestic relations order or Section
8(a)(ii) as determined by the Committee.
(ii) No Award may be assigned, alienated, pledged, attached, sold or
otherwise transferred or encumbered by a Participant otherwise than by will or
by the laws of descent and distribution or pursuant to a domestic relations
order, and any such purported assignment, alienation, pledge, attachment,
sale, transfer or encumbrance shall be void and unenforceable against the
Company; provided, however, that the designation of a beneficiary shall not
constitute an assignment, alienation, pledge, attachment, sale, transfer or
encumbrance. Notwithstanding the preceding sentence, the Committee shall have
discretionary authority to permit the transfer of any Non-Qualified Stock
Option to members of a Participant's immediate family, including trusts for
the benefit of such family members and partnerships in which such family
members are the only partners; provided, however, that a transferred
Non-Qualified Stock Option may be exercised by the transferee on any date only
to the extent that the Participant would have been entitled to exercise the
Non-Qualified Stock Option on such date had the Non-Qualified Stock Option not
been transferred. Any transferred Non-Qualified Stock Option shall remain
subject to the terms and conditions of the Participant's Award Agreement.
(b) No Rights to Awards. No Employee, Participant or other Person shall have
any claim to be granted any Award, and there is no obligation for uniformity
of treatment of Employees, Participants, or holders or beneficiaries of
Awards. The terms and conditions of Awards need not be the same with respect
to each recipient.
(c) Share Certificates. All Shares or other securities of the Company
delivered under the Plan pursuant to any Award or the exercise thereof shall
be subject to such stop transfer orders and other restrictions as the
Committee may deem advisable under the Plan or the rules, regulations, and
other requirements of the SEC, any stock exchange or national securities
association upon which such Shares or other securities are then listed, and
any applicable Federal or state laws, and the Committee may cause a
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legend or legends to be put on any certificates representing such Shares or
other securities to make appropriate reference to such restrictions.
(d) Delegation. Subject to the terms of the Plan and applicable law, the
Committee may delegate to one or more officers or managers of the Company, or
to a committee of such officers or managers, the authority, subject to such
terms and limitations as the Committee shall determine, to grant Awards to, or
to cancel, modify or waive rights with respect to, or to alter, discontinue,
suspend, or terminate Awards held by, Employees who are not officers or
directors of the Company for purposed of Section 16 of the Exchange Act, or
any successor section thereto, or who are otherwise not subject to such
Section.
(e) Withholding. A Participant shall be required to pay to the Company and
the Company is hereby authorized to withhold from any Award, from any payment
due or transfer made under any Award or from any compensation or other amount
owing to a Participant the amount of any applicable withholding taxes in
respect of an Award, its exercise, or any payment or transfer under an Award
and to take such other action as may be necessary in the opinion of the
Company to satisfy all obligations for the payment of such taxes, including,
but not limited to, the withholding of the issuance of Shares to be issued
upon the exercise of any Option or Director Option until the Participant
reimburses the Company for any amount required to be withheld.
(f) Award Agreements. Each Award hereunder shall be evidenced by an Award
Agreement which shall be delivered to the Participant and shall specify the
terms and conditions of the Award and any rules applicable thereto.
(g) No Limit on Other Compensation Arrangements. Nothing contained in the
Plan shall prevent the Company or any Affiliate from adopting or continuing in
effect other compensation arrangements, which may, but need not, provide for
the grant of options, restricted stock, Shares and other types of Awards
provided for hereunder (subject to shareholder approval if such approval is
required), and such arrangements may be either generally applicable or
applicable only in specific cases.
(h) No Right to Employment. The grant of an Award shall not be construed as
giving a Participant the right to be retained in the employ of the Company or
an Affiliate. Further, the Company may at any time dismiss a Participant from
employment, free from any liability or any claim under the Plan, unless
otherwise expressly provided in the Plan or in any Award Agreement.
(i) No Rights as Stockholder. Subject to the provisions of the applicable
Award, no Participant or holder or beneficiary of any Award shall have any
rights as a stockholder with respect to any Shares to be distributed under the
Plan until he has become the holder of such Shares.
(j) Governing Law. The validity, construction, and effect of the Plan and
any rules and regulations relating to the Plan and any Award Agreement shall
be determined in accordance with the laws of the State of Missouri, without
giving effect to the choice of law principles thereof.
(k) Severability. If any provisions of the Plan or any Award is or becomes
or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or
as to any Person or Award, or would disqualify the Plan or any Award under any
law deemed applicable by the Committee, such provision shall be construed or
deemed amended to conform to the applicable laws, or if it cannot be construed
or deemed amended without, in the determination of the Committee, materially
altering the intent of the Plan or the Award, such provision shall be stricken
as to such jurisdiction, Person or Award and the remainder of the Plan and any
such Award shall remain in full force and effect.
(l) Other Laws. The Committee may refuse to issue or transfer any Shares or
other consideration under an Award if, acting in its sole discretion, it
determines that the issuance or transfer of
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such Shares or such other consideration might violate any applicable law or
regulation or entitle the Company to recovery under Section 16(b) of the
Exchange Act, and any payment tendered to the Company by a Participant, other
holder or beneficiary in connection with the exercise of such Award shall be
promptly refunded to the relevant Participant, holder or beneficiary. Without
limiting the generality of the foregoing, no Award granted hereunder shall be
construed as an offer to sell securities of the Company, and no such offer
shall be outstanding, unless and until the Committee in its sole discretion
has determined that any such offer, if made, would be in compliance with all
applicable requirements of the U.S. federal securities laws.
(m) No Trust or Fund Created. Neither the Plan nor any Award shall create or
be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company and a Participant or any other Person. To
the extent that any Person acquires a right to receive payments from the
Company pursuant to an Award, such rights shall be no greater than the right
of any unsecured general creditor of the Company.
(n) Rule 16b-3 Compliance. With respect to persons subject to Section 16 of
the Exchange Act, transactions under this Plan are intended to comply with all
applicable terms and conditions of Rule 16b-3 and any successor provisions.
To the extent that any provision of the Plan or action by the Committee fails
to so comply, it shall be deemed null and void, to the extent permitted by law
and deemed advisable by the Committee.
(o) Headings. Headings are given to the Sections and subsections of the Plan
solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation
of the Plan or any provision thereof.
(p) No Impact on Benefits. Unless specifically provided under any other
benefit plan of the Company or its Affiliates, Awards shall not be treated as
compensation for purposes of calculating an Employee's or Eligible Director's
rights under such benefit plans.
(q) Indemnification. Each person who is or shall have been a member of the
Committee or of the Board shall be indemnified and held harmless by the
Company against and from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him in connection with or resulting
from any claim, action, suit, or proceeding to which he may be made a party or
in which he may be involved by reason of any action taken or failure to act
under the Plan and against and from any and all amounts paid by him in
settlement thereof, with the Company's approval, or paid by him in
satisfaction of any judgement in any such action, suit, or proceeding against
him, provided he shall give the Company an opportunity, at its own expense, to
handle and defend the same before he undertakes to handle and defend it on his
own behalf. The foregoing right of indemnification shall not be exclusive and
shall be independent of any other rights of indemnification to which such
persons may be entitled under the Company's articles of incorporation or
bylaws, by contract, as a matter of law, or otherwise.
SECTION 9. Term of the Plan.
(a) Effective Date. The Plan shall become effective on June 12, 1997 but
only if, prior to such date, the Plan is approved by a majority of the
Company's stockholders at an annual or special meeting of stockholders of the
Company held not more than twelve (12) months after the date of adoption of
the Plan by the Board.
(b) Expiration Date. The Plan shall terminate on and no Award shall be
granted under the Plan after the tenth anniversary of the Effective Date.
Unless otherwise expressly provided in the Plan or in an applicable Award
Agreement, any Award granted hereunder may, and the authority of the Board or
the Committee to amend, alter, adjust, suspend, discontinue, or terminate any
such Award or to waive any conditions or rights under any such Award shall,
continue after the tenth anniversary of the Effective Date.
* * *
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EXHIBIT B
CNS Bancorp, Inc.
1997 Management Recognition and Development Plan
1. Purpose; Definitions.
The purpose of the Plan is to increase the proprietary and vested
interest of the key Employees and Eligible Directors of the Company and its
Affiliates in the growth, development and financial success of the Company and
its Affiliates by granting them awards of Restricted Shares.
Whenever the following terms are used in the Plan, they shall have the
meaning specified below unless the context clearly indicated to the contrary.
"Affiliate" shall mean the Bank and any other "subsidiary" of the Company as
defined in Section 424(f) of the Code.
"Award" shall mean an award of Restricted Shares under the Plan.
"Bank" shall mean City National Savings Bank, FSB, Jefferson City, Missouri,
or any successor thereto.
"Board" shall mean the Board of Directors of the Company.
"Change in Control" shall mean an event deemed to occur if and when (a) an
offeror other than the Company purchases shares of the common stock of the
Company or the Bank pursuant to a tender or exchange offer for such shares,
(b) any person (as such term is used in Sections 13(d) and 14(d)(2) of the
Exchange Act) is or becomes the beneficial owner, directly or indirectly, of
securities of the Company or Bank representing twenty-five percent (25%) or
more of the combined voting power of the Company's or the Bank's then
outstanding securities, (c) the membership of the board of directors of the
Company or the Bank changes as the result of a contested election, such that
individuals who were directors at the beginning of any twenty-four (24) month
period (whether commencing before or after the date of adoption of this Plan)
do not constitute a majority of the Board at the end of such period, or (d)
shareholders of the Company or the Bank approve a merger, consolidation, sale
or disposition of all or substantially all of the Company's or the Bank's
assets or a plan of partial or complete liquidation. If any of the events
enumerated in clauses (a) - (d) occur, the Board shall determine the effective
date of the change in control resulting therefrom.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Committee" shall mean a committee of the Board consisting of at least two
non-employee directors designated by the Board to administer the Plan. If a
separate committee is not designated by the Board, the Board shall serve as
the Committee for all purposes under the Plan.
"Company" shall mean CNS Bancorp, Inc., a Delaware corporation.
"Designated Beneficiary" shall have the meaning set forth in Section 2.2
hereof.
"Disability" shall have the meaning set forth in Section 22(e)(3) of the Code.
For purposes of the Plan, all determinations as to whether a Participant has
become disabled shall be made by a majority of the Committee, upon the basis
of such evidence as it deems necessary or desirable, and shall be final and
binding on all interested persons.
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"Effective Date" shall have the meaning set forth in Section 5.1 hereof.
"Eligible Director" shall mean a member of the Board on the Effective Date who
is not also an Employee.
"Employee" shall mean any person who is employed by the Company or an
Affiliate.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Participant" shall mean an Employee or Eligible Director to whom an award of
Restricted Shares is granted pursuant to the Plan.
"Plan" shall mean this CNS Bancorp, Inc. 1997 Management Recognition and
Development Plan, as hereinafter amended from time to time.
"Restricted Shares" shall mean Shares which are awarded to an Employee or
Eligible Director that are subject to the transfer and forfeitability
restrictions described in Section 4.2.
"Share" shall mean a share of the Company's common stock, par value $.01 per
share.
2. Administration.
2.1 Administration
The Plan shall be administered by the Committee, which shall have the
power to interpret the Plan and to adopt such rules for the administration,
interpretation and application of the Plan and Awards thereunder as are
consistent with its terms and provisions and to interpret, amend or revoke any
such rules. All actions taken and all interpretations and determinations made
by the Committee shall be binding upon all persons, including the Company,
shareholders, Participants and Designated Beneficiaries. The Secretary of the
Company shall be authorized to implement the Plan in accordance with its
terms, and to take such actions of a ministerial nature as shall be necessary
to effectuate the intent and purposes thereof. No member of the Committee
shall be personally liable for any action, determination or interpretation
made in good faith with respect to the Plan or the Awards thereunder, and all
members of the Committee shall be fully protected by the Company in respect to
any such action, determination or interpretation.
2.2 Designated Beneficiaries
If a Participant dies prior to receiving any payment due under the Plan,
such payment shall be made to his Designated Beneficiary. A Participant's
Designated Beneficiary shall be the beneficiary specifically designated by a
Participant in writing to receive amounts due the Participant in the event of
the Participant's death. In the absence of an effective designation by the
Participant, Designated Beneficiary shall mean the Participant's surviving
spouse or, if none, his estate.
3. Shares Subject To The Plan.
3.1 Shares Subject to the Plan
The maximum number of Shares that may be the subject of Awards under this
Plan shall be 66,125. The Company shall reserve such number of Shares for the
purposes of the Plan out of its authorized but unissued Shares or out of
Shares held in the Company's treasury, or partly out of each. In the event
that a trust is established in connection with the Plan pursuant to Section
5.4, the Company may authorize the trustees of the trust to purchase Shares in
the open market with funds contributed by the Company or an
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Affiliate and such shares shall be included in the number of shares that may
be the subject of Awards. In the event that Restricted Shares are forfeited
for any reason, such Shares shall thereafter again be available for award
pursuant to the Plan.
3.2 Changes in the Company's Shares
In the event that the Committee shall determine that any
recapitalization, reorganization, merger, consolidation, stock split,
spin-off, combination, or exchange of Shares, or other similar corporate event
affects the Shares such that an adjustment is required in order to preserve
the benefits or potential benefits intended under this Plan, the Committee
shall, in such manner as it may deem equitable, adjust any or all of the
number and kind of Shares which thereafter may be awarded under the Plan, or
the number and kind of Shares subject to outstanding awards; provided,
however, that the number of Shares subject to any award shall always be a
whole number.
4. Restricted Shares
4.1 Eligibility; Awards Under the Plan
(a) Eligibility. Employees (including officers and employee directors of the
Bank) and Eligible Directors shall be eligible to participate in the Plan upon
designation by the Committee. To the extent that Shares are available for
grant under the Plan, then upon recommendation of the Board, the Committee
shall determine which of the Employees and Eligible Directors shall be granted
an Award and the number of Restricted Shares covered by each Award. In
selecting those Employees to whom Awards will be granted and the number of
Shares covered by such Awards, the Committee shall consider the position and
responsibilities of the eligible Employees, the length and value of their
services to the Company and its Affiliates, the compensation paid to the
Employees and any other factors the Committee may deem relevant, and the
Committee may request the written recommendation of the chief executive
officer and other senior executive officers of the Company and its Affiliates.
(b) Limitation on Awards. Notwithstanding anything herein to the contrary,
(i) no Employee shall receive Awards covering in excess of twenty five percent
(25%), (ii) no Eligible Director shall receive Awards covering in excess of
five percent (5%) and (iii) Eligible Directors shall not receive Awards
covering in excess of thirty percent (30%) in the aggregate, of the number of
shares reserved for issuance under the Plan.
(c) Fractions of Shares. Whenever under the terms of the Plan a fractional
share would be required to be issued, the fractional share shall be rounded up
to the next full share.
4.2 Terms of Awards
The Restricted Shares awarded hereunder shall be awarded only pursuant to
a written agreement, which shall be executed by the Participant and a duly
authorized officer of the Company and which shall contain the following terms
and conditions:
(a) Acceptance of Award. An award of Restricted Shares must be accepted by
the Participant within a period of sixty (60) days (or such other period as
the Committee may specify at grant) after the award date by the execution of a
Restricted Share award agreement in the form provided by the Company.
(b) Restrictions and Conditions. The Restricted Shares awarded to a
Participant pursuant to this Section 4 shall be subject to the following
restrictions and conditions:
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(i) A Participant shall not be permitted to vote, sell, transfer, pledge,
assign or otherwise encumber Restricted Shares awarded under the Plan prior to
the date on which such shares vest in accordance with clause (iii), except in
accordance with the laws of descent and distribution.
(ii) On the date an Award of Restricted Shares vests in accordance with
clause (iii), a Participant (or his beneficiary) shall be entitled to receive
any cash dividends previously paid with respect to the Restricted Shares,
together with interest accrued thereon (at a reasonable rate established from
time to time by the Committee). Prior to such date, cash dividends shall be
held by the Company for the account of the Participant. Stock dividends, if
any, issued with respect to Restricted Shares shall be treated as additional
Restricted Shares that are subject to the same restrictions and other terms
and conditions that apply with respect to the Restricted Shares with respect
to which such dividends are paid.
(iii) Subject to the applicable provisions of the Restricted Share award
agreement and this Section, a Participant's interest in Shares shall
immediately become fully vested and nonforfeitable, and the restrictions set
forth in this Section 4.2 shall lapse (x) ratably over a five (5) year period
whereby twenty percent (20%) of the Award shall vest on each of the first
through the fifth anniversaries of the date of grant so long as the
Participant remains an Employee or Eligible Director (y) upon the
Participant's death or Disability, or (z) upon a Change in Control.
4.3 Stock Certificates
Except as otherwise provided herein, a stock certificate registered in
the name of each Participant receiving a Restricted Share award (or in the
name of a trustee for the benefit of each Participant) shall be issued in
respect of such shares. Such certificate shall bear whatever appropriate
legend referring to the terms, conditions, and restrictions applicable to such
award as the Committee shall determine. The Committee may, in its sole
discretion, require that the stock certificates evidencing Restricted Shares
be held in custody by the Company (or in trust by a trustee) until the
restrictions thereon shall have lapsed. If a trust is established in
connection with the Plan, a certificate or certificates may be solely issued
in the name of the trust; provided, however, that the trustee shall maintain a
record of Awards authorized under the Plan and the amount of cash dividends
payable to a Participant upon the vesting of any Award or installment thereof.
5. Miscellaneous.
5.1 Shareholder Approval; Effective Date; Term
The Plan shall become effective on June 12, 1997 but only if, prior to
such date, the Plan is approved by a majority of the Company's shareholders at
an annual or special meeting of shareholders of the Company. The Plan shall
continue in effect until the tenth anniversary of the Effective Date.
5.2 Amendment, Suspension or Termination of the Plan
The Plan may be wholly or partially amended or otherwise modified,
suspends or terminated at any time or from time to time by the Board;
provided, however, that no amendment or modification shall be made without
shareholder approval if such approval is necessary to comply with any tax or
regulatory requirement with which the Board deems it necessary or appropriate
to comply.
From and after the Effective Date, neither the amendment, suspension nor
termination of the Plan shall, without the consent of the Participant, alter
or impair any rights or obligations under any award theretofore granted. No
awards may be granted during any period of suspension nor after termination or
expiration of the Plan.
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5.3 Regulations and Other Approvals
(a) The obligation of the Company to deliver Shares with respect to any award
granted under the Plan shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state securities laws, and
the obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Board.
(b) The Board may make such changes to the Plan as may be necessary or
appropriate to comply with the rules or requirements of any governmental
authority.
(c) Each award of Shares is subject to the requirement that, if at any time
the Board determines, in its sole discretion, that the listing, registration
or qualification of Shares issuable pursuant to the Plan is required by any
securities exchange or under any United States, state or federal law, or the
consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, issuance of Shares, no
Shares shall be issued, in whole or in part, unless listing, registration,
qualification, consent or approval has been effected or obtained free of any
conditions as acceptable to the Board.
(d) In the event that the disposition of Shares acquired pursuant to the Plan
is not covered by a then current registration statement under the Securities
Act of 1933, and is not otherwise exempt from such registration, such Shares
shall be restricted against transfer to the extent required by the Securities
Act of 1933 or regulations thereunder, and the Board may require any
individual receiving Shares pursuant to the Plan, as a condition precedent to
receipt of such Shares, to represent to the Company in writing that the Shares
acquired by such individual are acquired for investment only and not with a
view to distribution. The certificate for any Shares acquired pursuant to the
Plan shall include any legend that the Board deems appropriate to reflect any
restrictions on transfer.
(e) At the time of grant of any award, the Board may provide in the
Restricted Share award agreement that any Shares received as a result of such
grant shall be subject to a right of first refusal in favor of the Company,
pursuant to which the Participant shall be required to offer to the Company
any Shares that he wishes to sell, with the price being the then fair market
value of such Shares, subject to such other terms and conditions as the Board
may specify in the award agreement.
(f) With respect to persons subject to Section 16 of the Exchange Act,
transactions under this Plan are intended to comply with all applicable terms
and conditions of Rule 16b-3 and any successor provisions. To the extent that
any provision of the Plan or action by the Committee fails to so comply, it
shall be deemed null and void, to the extent permitted by law and deemed
advisable by the Committee.
(g) A Participant shall be required to pay to the Company or an Affiliate the
amount of any applicable withholding taxes in respect of an Award and the
Company shall be authorized to take such other action as may be necessary in
the opinion of the Company to satisfy all obligations for the payment of such
taxes, including, but not limited to, the withholding of the issuance of
Shares to be issued upon the vesting of any Award, until the Participant
reimburses the Company for any amount required to be withheld.
5.4 Trust Arrangement
All benefits under the Plan represent an unsecured promise to pay by the
Company. The Plan shall be unfunded and the benefits hereunder shall be paid
only from the general assets of the Company resulting in the Participants
having no greater rights than the Company's general creditors; provided,
however, that nothing herein shall prevent or prohibit the Company from
establishing a trust or other arrangement for the purpose of providing for the
payment of the benefits payable under the Plan.
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5.5 Governing Law
The Plan and the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the State of Missouri
without giving effect to the choice of law principles thereof.
5.6 Titles; Construction
Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of the Plan. The masculine pronoun
shall include the feminine and neuter and the singular shall include the
plural, when the context so indicates.
* * *
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REVOCABLE PROXY
CNS BANCORP, INC.
ANNUAL MEETING OF SHAREHOLDERS
April 22, 1997
The undersigned hereby appoints Richard E. Caplinger, Michael A.
Dallmeyer, Robert E. Chiles and John C. Kolb of the Board of Directors of CNS
Bancorp, Inc. (the "Company") with full powers of substitution to act as
attorneys and proxies for the undersigned, to vote all shares of Common Stock
of the Company which the undersigned is entitled to vote at the Annual Meeting
of Shareholders, to be held at the Company's main office at 427 Monroe Street,
Jefferson City, Missouri, on Tuesday, April 22, 1997, at 10:00 a.m., local
time, and at any and all adjournments thereof, as follows:
VOTE
FOR WITHHELD
1. The election as directors of the nominees [ ] [ ]
listed below (except as marked to the
contrary below).
James F. McHenry
James E. Whaley
Ronald D. Roberson
INSTRUCTIONS: To withhold your vote
for any individual nominee, write the
nominee's name on the line below.
______________________________________
FOR AGAINST ABSTAIN
2. The adoption of the CNS [ ] [ ] [ ]
Bancorp, Inc. 1997
Stock Option Plan.
3. The adoption of the CNS [ ] [ ] [ ]
Bancorp, Inc. 1997 Management
Recognition and Development Plan.
4. In their discretion, upon such other matters
as may properly come before the meeting.
The Board of Directors recommends a vote "FOR" the listed propositions.
This proxy also provides voting instructions to the Trustees of the City
National Savings Bank, FSB Employee Stock Ownership Plan for participants with
shares allocated to their accounts.
This proxy will be voted as directed, but if no instructions are specified
this proxy will be voted for the propositions stated. If any other business
is presented at the Annual Meeting, this proxy will be voted by the Board of
Directors in its best judgment. At the present time, the Board of Directors
knows of no other business to be presented at the Annual Meeting. This proxy
also confers discretionary authority on the Board of Directors to vote with
respect to the election of any person as director where the nominees are
unable to serve or for good cause will not serve and matters incident to the
conduct of the Annual Meeting.
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THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and elect to vote at the Annual Meeting
or at any adjournment thereof and after notification to the Secretary of the
Company at the Annual Meeting of the shareholder's decision to terminate this
proxy, then the power of said attorneys and proxies shall be deemed terminated
and of no further force and effect.
The undersigned acknowledges receipt from the Company prior to the
execution of this proxy of the Notice of Annual Meeting of Shareholders, a
Proxy Statement dated March 19, 1997 and the 1996 Annual Report to
Shareholders.
Dated:____________________ , 1997
____________________________ ____________________________
PRINT NAME OF SHAREHOLDER PRINT NAME OF SHAREHOLDER
____________________________ ____________________________
SIGNATURE OF SHAREHOLDER SIGNATURE OF SHAREHOLDER
Please sign exactly as your name appears on the enclosed card. When signing
as attorney, executor, administrator, trustee or guardian, please give your
full title. If shares are held jointly, each holder should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE.
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