<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2)
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Materials Pursuant to Rule 14a-11(c) or Rule 14a-12
CNBT BANCSHARES, INC.
------------------------------------------
(Name of Registrant as Specified in Its Charter)
John T. Unger, Snell & Smith, P.C., 1000 Louisiana, Suite 1200, Houston, TX
77002
---------------------------------------------------------------------------
(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)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
_________________________________________________________________
2) Aggregate number of securities to which transaction applies:
_________________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
_________________________________________________________________
4) Proposed maximum aggregate value of transaction:
_________________________________________________________________
5) Total fee paid:
_________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing fee for which the offsetting fee was paid
previously. Identify the previous filing by registration number, or the Form or
Schedule and the date of its filing.
1) Amount Previously Paid:
_____________________________________________
2) Form, Schedule, or Registration Statement No.:
_____________________________________________
3) Filing Party:
_____________________________________________
4) Date Filed:
_____________________________________________
<PAGE>
CNBT BANCSHARES, INC.
5320 BELLAIRE BOULEVARD
BELLAIRE, TEXAS 77401
713-661-4444
April 17, 2000
Dear Stockholder:
You are cordially invited to attend the 2000 Annual Meeting of Stockholders
of CNBT Bancshares, Inc. The meeting will be held on Tuesday, May 23, 2000 at
3:00 p.m., Houston time, at the offices of Citizens National Bank of Texas (the
"Bank"), 5320 Bellaire Boulevard, Bellaire, Texas 77401. We hope that you will
be able to attend.
Enclosed is a notice setting forth the business expected to come before the
meeting, the Proxy Statement, a form of proxy card, and a copy of the Company's
1999 Annual Report.
Whether or not you plan to attend the meeting in person, your shares should
be represented and voted at the meeting. After reading the enclosed Proxy
Statement, kindly complete, sign, date, and promptly return the proxy card in
the enclosed self-addressed envelope. No postage is required if it is mailed in
the United States. Submitting the proxy will not preclude you from voting in
person at the meeting should you later decide to do so.
Your cooperation in promptly submitting your proxy is greatly appreciated.
On behalf of the Board of Directors, thank you for your cooperation and
continued support.
Very truly yours,
/s/ Frank G. Cook /s/ Ralph Williams
- --------------------- ---------------------
Frank G. Cook Ralph Williams
Chairman of the Board President and Chief Executive Officer
<PAGE>
CNBT BANCSHARES, INC.
5320 BELLAIRE BOULEVARD
BELLAIRE, TEXAS 77401
NOTICE OF 2000 ANNUAL MEETING OF STOCKHOLDERS
<TABLE>
<CAPTION>
April 17, 2000
<S> <C> <C>
TIME 3:00 p.m. Houston time on Tuesday, May 23, 2000
PLACE Citizens National Bank of Texas, 5320 Bellaire
Boulevard, Bellaire, Texas 77401
ITEMS OF BUSINESS 1. To elect 17 members to the Board of Directors
for the ensuing year.
2. To ratify the Board of Directors' appointment of
Mann Frankfort Stein & Lipp as the Company's
independent auditors for the fiscal year ending
December 31, 2000.
3. To transact such other business as may properly
come before the meeting.
RECORD DATE You are entitled to vote if you were a stockholder at
the close of business on March 31, 2000.
VOTING BY PROXY Please submit a proxy as soon as possible so that your
shares can be voted at the meeting in accordance with
your instructions. You may submit your proxy (1) over
the Internet, (2) by telephone, or (3) by mail. For
specific instructions, please refer to the Questions
and Answers, beginning on page 1 of this proxy
statement and the instructions on the proxy card.
Additional information regarding the matters to be
acted on at the Annual Meeting can be found in the
accompanying Proxy statement.
By order of the Board of Directors,
/s/ Kay Cronover
--------------------
KAY CRONOVER
Secretary
PLEASE MARK, SIGN, DATE, AND RETURN YOUR PROXY IN THE
ENCLOSED ENVELOPE OR SUBMIT YOUR PROXY
BY PHONE OR THE INTERNET
</TABLE>
<PAGE>
CNBT BANCSHARES, INC.
5320 BELLAIRE BOULEVARD
BELLAIRE, TEXAS 77401
-----------------------
PROXY STATEMENT
-----------------------
This Proxy Statement is furnished to the stockholders of CNBT Bancshares, Inc.
(the "Company"), in connection with the solicitation by its Board of Directors
of proxies to be voted at the 2000 Annual Meeting of Stockholders to be held on
Tuesday, May 23, 2000, at 3:00 p.m., local time, at 5320 Bellaire Boulevard,
Bellaire, Texas 77401, and at any adjournment or postponement thereof.
ABOUT THE MEETING
WHAT IS THE PURPOSE OF THE ANNUAL MEETING?
At the Company's annual meeting, stockholders will act upon the matters
outlined in the accompanying notice of meeting, including the election of
directors and ratification of the Company's independent auditors. In addition,
the Company's management will report on the performance of the Company during
1999 and respond to questions from stockholders.
WHO IS ENTITLED TO VOTE?
Only stockholders of record at the close of business on the record date, March
31, 2000, are entitled to receive notice of the annual meeting and to vote the
shares of common stock that they held on that date at the meeting, or any
postponement or adjournment of the meeting. Each outstanding share entitles its
holder to cast one vote on each matter to be voted upon.
WHO CAN ATTEND THE MEETING?
All stockholders as of the record date, or their duly appointed proxies, may
attend the meeting. Each stockholder may be asked to present valid picture
identification, such as a driver's license or passport. Cameras, recording
devices, and other electronic devices will not be permitted at the meeting.
Please note that if you hold your shares in "street name" (that is, through a
broker or other nominee), you will need to bring a copy of a brokerage statement
reflecting your stock ownership as of the record date and check in at the
registration desk at the meeting.
Parking is available in the Bank's parking lot.
WHAT CONSTITUTES A QUORUM?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the shares of common stock outstanding on the record date will
constitute a quorum, permitting the meeting to conduct its business. As of the
record date, 4,926,918 shares of common stock of the Company were outstanding.
Proxies received but marked as abstentions and broker non-votes that are voted
on any matter will be included in the calculation of the number of shares
considered to be present at the meeting.
<PAGE>
HOW DO I VOTE?
If you complete and properly sign the accompanying proxy card and return it to
the Company, it will be voted as you direct. If you are a registered stockholder
and attend the meeting, you may deliver your completed proxy card in person.
"Street name" stockholders who wish to vote at the meeting will need to obtain a
proxy form from the institution that holds their shares.
CAN I VOTE BY TELEPHONE OR ELECTRONICALLY?
If you are a registered stockholder (that is, if you hold your stock in your
own name), you may vote by telephone, or electronically through the Internet, by
following the instructions included with your proxy card.
If your shares are held in "street name," you will need to contact your broker
or other nominee to determine whether you will be able to vote by telephone or
electronically.
CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD?
Yes. Even after you have submitted your proxy, you may change your vote at any
time before the proxy is exercised by filing with the Secretary of the Company
either a notice of revocation or a duly executed proxy bearing a later date. The
powers of the proxy holders will be suspended if you attend the meeting in
person and so request, although attendance at the meeting will not by itself
revoke a previously granted proxy.
WHAT ARE THE BOARD'S RECOMMENDATIONS?
Where a choice is specified on any proxy card as to the vote on any matter to
come before the Annual Meeting, the proxy will be voted in accordance with such
specification. Where no choice is specified, the persons named as proxy holders
on the proxy card will vote in accordance with the recommendations of the Board
of Directors. The Board's recommendation is set forth together with the
description of each item in this proxy statement. In summary, the Board
recommends a vote:
. for election of the nominated slate of directors (see page 4); and
. for ratification of the appointment of Mann Frankfort Stein & Lipp as the
Company's independent auditors (see page 16)
With respect to any other matter that properly comes before the meeting, the
proxy holders will vote as recommended by the Board of Directors or, if no
recommendation is given, in their own discretion.
WHAT VOTE IS REQUIRED TO APPROVE EACH ITEM?
Election of Directors. The affirmative vote of a plurality of the votes cast
at the meeting is required for the election of directors. A properly executed
proxy marked "WITHHOLD AUTHORITY" with respect to the election of one or more
directors will not be voted with respect to the director or directors indicated,
although it will be counted for purposes of determining whether there is a
quorum.
2
<PAGE>
Other Items. For each other item, the affirmative vote of the holders of a
majority of the shares represented in person or by proxy and entitled to vote on
the item will be required for approval. A properly executed proxy marked
"ABSTAIN" with respect to any such matter will not be voted in favor of or
against such matter, although it will be counted as votes for purposes of
determining whether there is a quorum.
If you hold shares in "street name" through a broker or other nominee, your
broker or nominee may not be permitted to exercise voting discretion with
respect to some of the matters to be acted upon. Thus, if you do not give your
broker or nominee specific instructions, your shares may not be voted on those
matters and will not be counted in determining the number of shares necessary
for approval. Shares represented by such "broker non-votes" will, however, be
counted in determining whether there is a quorum.
WHO WILL BEAR THE COST OF SOLICITING VOTES FOR THE MEETING?
The cost of soliciting proxies will be paid by the Company. Copies of
solicitation material will be furnished to brokerage houses, fiduciaries, and
custodians to forward to beneficial owners of stock held in the name of such
nominees. The solicitation of proxies will be by mail, telephone, or otherwise
through the officers and regular employees of the Company and the Bank without
special compensation therefor.
WHO ARE THE LARGEST OWNERS OF THE COMPANY'S STOCK?
The Company knows of no single person or group that is the beneficial owner of
more than 5% of the outstanding shares of Common Stock. The directors and
officers of the Company, as a group, beneficially owned (including currently
exercisable stock options) approximately 27.6% of the shares of Common Stock.
HOW MUCH STOCK DO THE COMPANY'S DIRECTORS AND EXECUTIVE OFFICERS OWN?
The table on page 17 shows the amount of common stock of the Company
beneficially owned by the Company's directors, the executive officers of the
Company named in the Summary Compensation Table on page 11, and the directors
and executive officers of the Company as a group.
3
<PAGE>
ELECTION OF DIRECTORS
Article III, Section 2 of the Bylaws of the Company provides that the
number of directors of the Company shall be set by the Board of Directors. The
Company currently has 17 directors and four advisory directors. The nominees
receiving an affirmative vote of a plurality of the shares entitled to vote and
present, either in person or by proxy, at the Annual Meeting, will be elected as
members of the Board. All of the elected directors will serve until their
respective successors have been duly elected and qualified or until they resign,
die, or are removed from office.
A stockholder may vote the number of shares owned by him or her for as many
persons as there are directors to be elected. Cumulative voting is not
permitted.
NOMINEES FOR DIRECTOR
The persons named as proxies in the enclosed form of proxy were selected by
the Board, and have advised the Board that, unless authority is withheld, they
intend to vote the shares represented by them at the Annual Meeting for the
election of John B. Barnes, William H. Bruecher, Jr., James K. Chancelor, C. Joe
Chapman, Frank G. Cook, Robert C. Dawson, Randall W. Dobbs, James B. Earthman,
III, Lura M. Griffin, Alton L. Hollis, Joseph E. Ives, Larry L. January, Albert
V. Kochran, I.W. Marks, David E. Preng, Mary A. Walker, and B. Ralph Williams as
directors John M. James, Robert J. Kramer, and Sheila J. Scantlin, as advisory
directors. All of the nominees are current members of the Board. All of the
nominees have consented to their nomination and will serve if elected to the
Board. The Board of Directors of the Company is the same as the Board of
Directors of the Bank.
THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE ELECTION OF THE
NOMINEES LISTED ABOVE AS DIRECTORS. UNLESS OTHERWISE DIRECTED IN THE
ACCOMPANYING PROXY, THE PERSONS NAMED THEREIN WILL VOTE "FOR" THE ELECTION OF
THE NOMINEES LISTED ABOVE AS DIRECTORS.
The Board knows of no reason why any nominee for director would be unable
to serve as a director. If at the time of the Annual Meeting any of the named
nominees are unable or unwilling to serve as directors of the Company, the
persons named as proxies intend to vote for such substitutes as may be nominated
by the Board.
Set forth below is a brief description of the background of the nominees
for election as directors.
John B. Barnes.
Mr. Barnes, age 57, has been a director of the Company since 1998 and the Bank
since 1988. Mr. Barnes is the founder and President and Chief Executive Officer
of Barney's Enterprises, Inc., a vending company, and Bar-Gal Enterprises, Inc.,
a management company.
4
<PAGE>
William H. Bruecher, Jr.
Mr. Bruecher, age 72, has been a director of the Company since 1998 and the
Bank since 1985. Mr. Bruecher is retired. He was President of Damon Hardware,
Inc. from 1984 to 1994.
James K. Chancelor.
Mr. Chancelor, age 59, has been a director of the Company since 1998 and the
Bank since December 1997. Mr. Chancelor is President and Chief Executive Officer
of TRS Financial Services Corp. which he founded in 1974.
C. Joe Chapman.
Mr. Chapman, age 76, has been a director of the Company since 1998 and the
Bank since 1988. Mr. Chapman is retired. He was Chairman of the Board of Key
Engineering, Inc., a Houston-based engineering contracting firm from 1980 to
1995. Mr. Chapman was Chairman of the Board of Chapman Engineers, Inc. from 1961
to 1979.
Frank G. Cook.
Mr. Cook, age 74, has been a director of the Company since 1998 and of the
Bank since 1983. He was a founder of the Bank in 1983, was President from 1983
until 1986, when he was elected Chairman of the Board, and was Chief Executive
Officer from 1983 until 1992. Prior to joining the Bank, Mr. Cook was Executive
Vice President and Cashier of First National Bank of Bellaire where he was
employed from 1979 until 1981. From 1950 until 1979, Mr. Cook was employed by
First State Bank of Bellaire; having advanced to the position of Executive Vice
President and Cashier and Secretary to the Board of Directors at the time he
left the bank.
Robert C. Dawson.
Mr. Dawson, age 85, has been a director of the Company since 1998 and the Bank
since 1983. Mr. Dawson is retired. He was President and General Manager of
Dawson TV, Inc. from 1952 to 1996.
Randall W. Dobbs.
Mr. Dobbs, age 42, has been a director of the Company since June 1999. He was
an advisory director of the Company from 1998 to June 1999 and has been a
director of the Bank since 1995. He joined the Bank as its first Cashier in
1983, became Chief of Operations in 1992, and Executive Vice President and Chief
of Operations in 1996. Prior to joining the Bank, Mr. Dobbs was employed by
Texas Bank & Trust from 1981 until 1983 and First National Bank of Bellaire from
1974 until 1981.
5
<PAGE>
James B. Earthman, III.
Mr. Earthman, age 65, has been a director of the Company since 1998 and the
Bank since 1983. Mr. Earthman is President of Galveston Capital Corporation. He
was Chairman of the Board of Earthman's, Inc., a funeral services company, from
1989 to 1994, when it was acquired by The Loewen Group, Inc. He also was
Chairman of the Board of National Capitol Life Insurance Co. from 1989 to 1994.
Mr. Earthman also practiced law with the firm of Jim Earthman & Associates, P.C.
from 1973 to 1997.
Lura M. Griffin.
Ms. Griffin, age 75, has been a director of the Company since 1998 and the
Bank since 1992. Since 1985, Ms. Griffin has been Secretary of Bud Griffin
Customer Service, Inc., a retail computer parts and service company with respect
to equipment sold by Bud Griffin & Associates, a computer systems support
business.
Alton L. Hollis.
Mr. Hollis, age 71, has been a director of the Company since 1998 and the Bank
since 1985. Mr. Hollis has been President and Chairman of the Board of Hollis
Oil Company, an independent oil producer and operator since 1985.
Joseph E. Ives.
Mr. Ives, age 55, has been a director of the Company since 1998 and the Bank
since 1984. He joined the Bank as Senior Vice President and was elected
Executive Vice President in 1986. Prior to joining the Bank, Mr. Ives was a
Senior Vice President with Texas Commerce Bank - Stafford from 1981 to 1984.
Prior to 1981, Mr. Ives was a loan officer with First National Bank of Bellaire
and First State Bank of Bellaire.
Larry L. January.
Mr. January, age 69, has been a director of the Company since 1998 and the
Bank since 1983. Mr. January is retired. He was President of January Home
Appliance Systems, an appliance sales company, which he founded in 1954, until
1992.
Albert V. Kochran.
Mr. Kochran, age 75, has been a director of the Company since 1998 and the
Bank since March 1998. Mr. Kochran has been Chairman of the Board of Southwest
Houston Tire Sales, Inc. since 1976. From 1951 to 1976, he was sales manager of
the Southwest Division of the Goodyear Tire and Rubber Company.
I.W. Marks.
Mr. Marks, age 65, has been a director of the Company since 1998 and the Bank
since 1983. Mr. Marks is President, Chief Executive Officer, and owner of I.W.
Marks Jewelers, Inc., an independent jewelry business operating in the Southwest
Houston area since 1978.
6
<PAGE>
David E. Preng.
Mr. Preng, age 53, has been a director of the Company since 1998 and the Bank
since 1983. Mr. Preng is founder and since 1980, has been President of Preng &
Associates, Inc., a retained executive search firm with offices in Houston,
London, Moscow, and Vienna. Mr. Preng is a director of Box Energy Corporation.
Mary A. Walker.
Ms. Walker, age 62, has been a director of the Company since 1998 and Bank
since 1986. She joined the Bank as Vice President in 1983 and was elected a
Director of the Bank in 1986 and a Senior Vice President in 1986. Prior to
joining the Bank, Ms. Walker was employed with First National Bank of Bellaire
as a Vice President and loan officer from 1979 to 1983.
B. Ralph Williams.
Mr. Williams, age 59, has been a director of the Company since 1998 and the
Bank since 1983. He was a founder of the Bank in 1983 and has been President
since 1986 and Chief Executive Officer since 1992. Prior to joining the Bank,
Mr. Williams was employed by East Texas National Bank of Palestine as a Vice
President, Loan Officer, and Compliance Officer from 1981 to 1983. He was
associated with First National Bank of Bellaire as Senior Vice President from
1979 to 1981, and with First State Bank of Bellaire from 1963 until 1979,
initially as a teller, and in various capacities advancing to Senior Vice
President. Mr. Williams was with Houston National Bank from 1958 to 1963.
There is no family relationship between any director, executive officer, or
person nominated or selected by the Board to become a director or executive
officer.
Advisory Directors
The Board of Directors has also elected three advisory directors: John M.
James, Robert J. Kramer, and Sheila J. Scantlin. The Advisory Directors attend
all meetings of the Board of Directors but are not entitled to vote on matters
presented to the Board of Directors for its approval.
John M. James
Mr. James, age 60, joined the Bank as a Senior Vice President in 1993. He was
elected an Advisory Director in December 1998. From 1985 to 1992, he served as
President of First City National Bank of Bellaire. From 1978 to 1985, Mr. James
was employed by First City National Bank in its corporate office
7
<PAGE>
in Houston. From 1973 to 1978, he was employed by the Federal Reserve Bank of
Dallas in its holding company examination division.
Robert J. Kramer.
Mr. Kramer, age 58, has been an Advisory Director of the Company since 1998.
Mr. Kramer joined the Bank on April 1, 1998, as President of the Northwest
Houston office, and was elected an Advisory Director of the Bank in June 1998.
From July 1985 to April 1998, he was President and Chief Executive Officer of
Independence Bank, N.A., Houston, Texas. From January 1983 to June 1985, he was
President and Chief Executive Officer of Mont Belvieu State Bank, Mont Belvieu,
Texas. From April 1975 to January 1983, he was Senior Vice President and cashier
of Charter National Bank - Colonial, Houston, Texas. Mr. Kramer has been active
in banking in the Houston area since 1961.
Sheila J. Scantlin.
Ms. Scantlin, age 38, has been an Advisory Director of the Company since 1998.
Ms. Scantlin joined the Bank as President of the Sugar Land office in 1995 and
was elected an Advisory Director of the Bank in November 1997. From February
1988 to July 1995, she was employed by Park National Bank - Stafford as a Vice
President. From 1982 to 1988 she was employed by American National Bank, which
was acquired by Park National Bank in 1988.
WHAT COMMITTEES HAS THE BOARD ESTABLISHED?
The Company has two committees: an Audit Committee and a Compensation
Committee. In addition, the Bank has seven committees: an Audit Committee, a
Building Committee, a Compensation Committee, a Personnel Committee, an
Investment-Asset/Liability Committee, a Loan Committee, and a Strategic Planning
Committee. The Board has no other standing committees. The Audit Committee and
the Compensation Committee of the Company and the Bank have the same members.
The Audit Committee currently consists of Mr. Hollis, Chairperson, Mr. Barnes,
Mr. Dawson, Ms. Griffin, Mr. January, and Mr. Preng, none of whom is an employee
of the Company or the Bank. The Audit Committee reviews the general scope of the
audit conducted by the Company's and the Bank's independent auditors, the fees
charged therefor, and matters relating to the Bank's internal control systems.
In performing its functions, the Audit Committee meets separately with
representatives of the Company's and the Bank's independent auditors and with
representatives of senior management. The Audit Committee held six meetings in
1999.
The Compensation Committee currently consists of Mr. Barnes, Chairperson, Mr.
Bruecher, Mr. Chancelor, Mr. Dawson, Mr. Hollis, Mr. Marks, and Mr. Preng. The
Compensation Committee is responsible for making recommendations to the Board of
Directors with respect to the compensation of the Company's executive officers
and is responsible for the establishment of policies dealing with various
compensation and employee benefit matters for the Company and the Bank,
administers the Company's stock option plans, and makes recommendations to the
Board of Directors as to option grants to Bank employees under such plans. The
Compensation Committee held one meeting in 1999.
The Personnel Committee currently consists of Ms. Griffin, Chairperson, Mr.
Cook, Mr. Dawson, Mr. Dobbs, Mr. Hollis, Mr. Ives, and Mr. Williams. The primary
function of the Personnel Committee is
8
<PAGE>
to set compensation for all personnel of the Bank other than officers. The
Personnel Committee met once during 1999.
The Investment-Asset/Liability Committee currently consists of Mr. Cook,
Chairperson, Mr. Hollis, Vice Chairman, Mr. Barnes, Mr. Dobbs, Mr. January, Mr.
Kochran, Mr. Kramer, Mr. Preng, and Mr. Williams. The primary function of the
Investment-Asset/Liability Committee is to plan and control the process of
matching the mix and maturities of assets and liabilities of the Bank in ways
that will provide a favorable and even flow of net interest income while
assuming reasonable business risk. The Investment-Asset/Liability Committee met
six times during 1999.
The Loan Committee currently consists of Mr. Williams, Chairperson,
Mr. Barnes, Mr. Bruecher, Mr. Cook, Mr. Dawson, Mr. Dobbs, Mr. Hollis, Mr. Ives,
Mr. James, Mr. Kramer, Ms. Scantlin, and Ms. Walker, and Peggy Cook and Sandra
Scott. The primary function of the Loan Committee is to review and approve
requests for loans in excess of the established lending authority of the
officers of the Bank. The Loan Committee meets as needed to approve loan
applications and met 87 times during 1999.
The Strategic Planning Committee currently consists of Ms. Scantlin,
Chairperson, Mr. Barnes, Mr. Cook, Mr. Dawson, Mr. Dobbs, Mr. Earthman,
Mr. Hollis, Mr. Ives, Mr. January, Mr. Kramer, Mr. Marks, Mr. Preng, and
Mr. Williams. The primary function of the Strategic Planning Committee is to
develop and review the Bank's strategic plan including the expansion of
facilities and services and the development of new products. The Strategic
Planning Committee met two times during 1999.
The Building Committee currently consists of Mr. Williams, Chairperson, Mr.
Barnes, Mr. Chancelor, Mr. Chapman, Mr. Cook, Mr. Dobbs, Mr. January, and Mr.
Kochran. The primary function of the Building Committee is to evaluate and
approve sites and plans for new branch
offices. The Building Committee met three times in 1999.
HOW OFTEN DID THE BOARD AND ITS COMMITTEES MEET DURING 1999?
During 1999, the Board met in person 13 times (including the Annual Meeting),
the Audit Committee held six meetings, and the Compensation Committee met once.
All directors attended more than 75% of the meetings held by the Board or the
committees of the Board on which they served, except for Mr. Marks who attended
eight of the 13 Board meetings.
The Restated Certificate of Incorporation and Bylaws of the Company provide
for the indemnification of the Company's directors in connection with their
activities as directors.
COMPENSATION OF DIRECTORS
Directors of the Company and the Bank receive a fee of $500 for each meeting
of the Board of Directors attended and $75 for each committee meeting attended.
The fee for committee meetings has been increased to $100 per meeting for 2000.
9
<PAGE>
NOMINATION OF DIRECTORS
In the event you are a stockholder entitled to vote for the election of
directors at a meeting and wish to make a director nomination at a stockholders
meeting, you must give written notice of your intention to make such nomination,
either by personal delivery or by U.S. mail, postage prepaid, to the President
of the Company, 5320 Bellaire Boulevard, Bellaire, Texas 77401, not less than 60
nor more than 90 days prior to an annual meeting. Each such notice must set
forth: (a) your name and address, (b) the name, age, business address, home
address, and principal occupation of the person or persons to be nominated;
(c) the principal occupation of the person or persons nominated; (d) the total
number of shares of capital stock of the Company that will be voted for each
person nominated; (e) the number of shares of capital stock you own; (f) a
representation that you are a holder of record of stock of the Company entitled
to vote at such meeting and intend to appear in person or by proxy at the
meeting to nominate the person or persons specified in the notice; (g) a
description of all arrangements or understandings between you and each nominee
and any other person or persons (naming such person or persons) pursuant to
which you are making the nomination or nominations; (h) such other information
regarding each nominee you propose as is required to be included in a proxy
statement filed pursuant to the rules of the SEC, had the nominee been
nominated, or intended to be nominated, by the Board of Directors; and (i) the
written consent of each nominee to serve as a director of the Company if so
elected. The chairman of the stockholder meeting will determine if a nomination
complies with the foregoing requirements and may disregard the nomination of any
person not made in compliance with the foregoing procedure.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS
No executive officers or employees of the Company or the Bank were members of
the Compensation Committee during 1999.
10
<PAGE>
EXECUTIVE COMPENSATION AND OTHER INFORMATION
The following table provides certain summary information concerning
compensation paid or accrued by the Company to or on behalf of the Company's
Chief Executive Officer and the four most highly compensated executive officers
other than the Chief Executive Officer (the "Named Executives").
<TABLE>
<CAPTION>
ANNUAL LONG-TERM
COMPENSATION COMPENSATION
------------- ---------------
STOCK
NAME AND UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS ($) OPTIONS(#) COMPENSATION(1)
- ------------------------------------------ ---------- ---------- ------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
B. Ralph Williams......................... 1999 $175,000 $40,000 -- $16,499
President and........................... 1998 175,000 40,000 -- 16,991
Chief Executive Officer................. 1997 144,000 25,000 10,000 17,201
Frank G. Cook............................. 1999 110,000 50,000 -- 18,484
Chairman of the Board................... 1998 110,000 50,000 -- 18,206
1997 110,000 35,000 10,000 19,073
Robert J. Kramer.......................... 1999 113,000 7,500 -- 14,303
President of Northwest Houston Office... 1998 82,500 7,500 10,000 4,000
Sheila J. Scantlin........................ 1999 104,000 18,000 -- 14,696
President of Sugar Land Office.......... 1998 92,000 15,000 -- 13,084
1997 80,000 15,000 10,000 6,769
Joseph E. Ives............................ 1999 100,000 12,500 -- 14,366
Executive Vice President................ 1998 96,000 10,000 -- 13,312
1997 91,800 10,000 10,000 13,560
- ----------------
</TABLE>
(1) Includes fees for Director's meetings attended, the Company's contribution
to the Company's 401(k) plan, and premiums on additional life insurance.
No options were granted to the officers named above under the Company's stock
option plans in 1999.
11
<PAGE>
STOCK OPTION EXERCISES AND FISCAL YEAR-END VALUES
The following table sets forth certain information concerning the value
realized on the exercise of stock options by the Named Executives during 1999
and the value of unexercised options held by each of the Named Executives at
December 31, 1999.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 1999 DECEMBER 31, 1999(1)
ACQUIRED ON VALUE ----------------- -------------------
EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- -------- ----------------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
B. Ralph Williams.... 10,000 $73,125 9,040 10,000 $ 73,320 $17,500
Frank G. Cook........ -- - - 10,000 - 17,500
Joseph E. Ives....... 3,616 28,476 2,904 10,000 23,232 17,500
Robert J. Kramer..... - - - 10,000 - 2,500
Sheila J. Scantlin... - - 4,840 17,260 22,0222 50,533
- ------------
</TABLE>
(1) The value is based on a closing price of $10.75 per share on December 31,
1999.
SEVERANCE AGREEMENTS
The Board of Directors has entered into agreements with Messrs. Dobbs, Ives,
James, Kramer, and Williams and Ms. Scantlin and Walker that provide generally
that in the case of a change in control of the Company and the discharge of any
such officer without cause within two years after such change in control, such
officer will be paid for two years and eleven months at their current salary. To
be eligible for such payment, the named officers must remain in the Company's
employ until the change in control is completed.
EMPLOYEE STOCK OPTION PLANS
The stockholders of the Company approved employee stock option plans in 1992,
1994, 1995, and 1997, providing for the grant of options, after adjustment for
stock splits and dividends, for 72,600, 36,300, 12,100, and 95,000 shares,
respectively. Options granted under the plans may be either "non-qualified" or
"incentive" stock options. The price at which options may be granted may not be
less than the fair market value on the dates of grant. Generally, under the
plans, options vest 20% at the end of the third year following the date of
grant, an additional 20% at the end of each of the two following years, and are
exercisable in full at the end of the sixth year following the date of grant.
Options must be exercised within ten years following the date of grant or no
more than three months after the optionee's termination of employment with the
Company, if earlier. The Board of Directors granted options for 10,000 shares to
Mr. Kramer in 1998.
At December 31, 1999, options for 151,517 shares granted to 16 employees were
outstanding, with per share exercise prices ranging from $2.75 to $10.50 per
share (as adjusted for subsequent stock dividends and stock splits), and of the
outstanding options, options to purchase an aggregate of 39,417 shares were
exercisable.
12
<PAGE>
401(K) PLAN
In 1991, the Bank adopted a contributory profit sharing plan pursuant to
Internal Revenue Code Section 401(k) (the "401(k) Plan") covering substantially
all employees. Each year the Bank determines, at its discretion, the amount of
contributions to the 401(k) Plan. Total plan expense charged to the Company's
operations for 1999, 1998, and 1997 was approximately $248,000, $200,000, and
$180,000, respectively.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee annually evaluates the performance of management,
reviews the compensation levels of members of management, and considers
management succession and related matters. The Committee reviews with the Board
of Directors in detail all of compensation for the nine officers who constitute
the Company's senior management group including a recommendation for annual cash
bonuses and grants of stock options.
The Compensation Committee administers an executive compensation plan which is
designed to:
1. Allow the Company to compete for and retain executives critical to the
Company's future success by providing compensation that is commensurate
with the Company's position as a well-capitalized institution that is
engaged in various activities to enhance its business.
2. Align the interest of its executives with the interest of the Board of
Directors and our stockholders by providing performance based awards
through annual cash bonuses and salary increases.
3. Increase ownership in the our Common Stock by our senior management through
the grant of stock options, thereby providing further incentive to senior
officers to improve the performance of the Company and our Common Stock.
The Compensation Committee believes that compensation for the senior
management of the Company should be based on achievement of an overall corporate
profit goal as well as business and individual goals and should provide an
incentive for effective management of our assets.
In 1999, the Compensation Committee based its evaluation of the performance
and compensation of the chief executive officer and the other executive officers
primarily on their leadership and performance in achieving the 1999 corporate
performance goals of the Company as well as on peer data for comparable
positions in financial institutions of a similar size.
John B. Barnes, Chairperson
William H. Bruecher, Jr.
James K. Chancelor
Robert C. Dawson
Alton L. Hollis
I.W. Marks
David E. Preng
13
<PAGE>
STOCK PERFORMANCE GRAPH
The graph below provides an indicator of cumulative total stockholder
returns for the Company as compared with the Nasdaq National Market Composite
Index and the Nasdaq Composite Bank Stock Index. This graph covers the period
from October 1, 1997, when the Company Common Stock was first traded on the
Nasdaq Stock Market, through December 31, 1999, and assumes that $100 was
invested on October 1, 1997, in the Company Common Stock, the Nasdaq National
Market Composite Index and the Nasdaq Composite Bank Stock Index, and that all
dividends were reinvested. The historical stock price performance for the
Company's Common Stock shown on the graph is not necessarily indicative of
future stock performance.
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
October 1, December 31, December 31, December 31,
1997 1997 1998 1999
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Company Common Stock* $100.00 $104.49 $ 85.04 $ 97.66
- ----------------------------------------------------------------------------------------
Nasdaq NMS Composite 100.00 92.90 129.72 240.74
- ----------------------------------------------------------------------------------------
Nasdaq Composite Bank Index 100.00 109.46 96.58 88.87
- ----------------------------------------------------------------------------------------
</TABLE>
* Based on a closing price on October 1, 1997, of $12.25. If the initial
offering price of $10.50 per share was used, the values at December 31, 1997,
1998, and 1999, would be $119.05, $98.10, and $113.94, respectively.
14
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the federal securities laws, the Company's directors, executive (and
certain other) officers, and any persons holding more than ten percent of the
Company's Common Stock are required to report their ownership of Common Stock
and any changes in that ownership to the Company and the SEC. Specific due dates
for these reports have been established by regulation and the Company is
required to report in this proxy statement any failure to file by these dates in
1999. All of these filings were satisfied by the Company's directors, officers,
and ten percent holders. Mr. Earthman filed one Form 4 late with respect to one
transaction.
As of April 10, 2000, the Company believes that all directors, officers and
ten percent holders are current in their filings. In making these statements,
the Company has relied on the written representations of its directors, officers
and ten percent holders and copies of reports that they have filed with the SEC.
INTERESTS OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
Many of the directors and executive officers of the Company and the Bank
and their associates, which include corporations, partnerships, and other
organizations in which they are officers or partners or in which they and their
immediate families have at least a 5% interest, are customers of the Bank.
During 1999, the Bank made loans in the ordinary course of business to certain
directors of the Company and the Bank and their associates, all of which the
Company believes were on substantially the same terms, including interest rates
and collateral, as those prevailing at the time for comparable transactions with
persons unaffiliated with the Company and the Bank and did not involve more than
the normal risk of collectibility or present other unfavorable features. Loans
to directors, executive officers, and principal stockholders of the Company and
the Bank (i.e., those who own 10% or more of the outstanding shares of Common
Stock) are subject to limitations contained in the Federal Reserve Act and
regulations issued by the Federal Reserve Board, the principal effect of which
is to require that extensions of credit by the Bank to executive officers,
directors and principal stockholders satisfy the foregoing standards. On
December 31, 1999, all of such loans aggregated approximately $1,683,000, which
was 5.00% of the Bank's Tier 1 capital at such date. The Bank expects to have
such transactions or transactions on a similar basis with its directors,
executive officers, and principal stockholders and their associates in the
future.
15
<PAGE>
RATIFICATION OF THE SELECTION OF INDEPENDENT
AUDITORS FOR THE BANK
The Board of Directors of the Company has selected the accounting firm of
Mann Frankfort Stein & Lipp, Certified Public Accountants, a Professional
Corporation, to audit the Company's financial statements for, and otherwise act
as the Company's independent accountants with respect to the fiscal year ending
December 31, 2000. In accordance with the Board's resolution, the selection of
Mann Frankfort Stein & Lipp for the current fiscal year is submitted to
stockholders for ratification. The Company knows of no direct or indirect
financial interest by Mann Frankfort Stein & Lipp in the Company.
Mann Frankfort Stein & Lipp, served as the Company's independent auditors
for the 1999 fiscal year and has served as the independent auditors for the
Company and the Bank since 1984. In addition to performing customary audit
services, Mann Frankfort Stein & Lipp assisted the Company and the Bank with the
preparation of its federal and state tax returns and provided assistance in
connection with regulatory matters and other agreed upon matters, charging the
Company and the Bank for such services at its customary hourly billing rates.
These non-audit services were approved by the Bank's Board of Directors after
the Board of Directors reviewed the nature and expense associated with such
services and concluded that there was no effect on the independence of the
accountants. The Company has been advised by Mann Frankfort Stein & Lipp that
none of its members has any financial interest in the Company.
A representative of Mann Frankfort Stein & Lipp is expected to be present
at the Annual Meeting and will be available to make a statement if he or she so
desires, and to respond to appropriate questions of the stockholders.
The proposal to ratify the appointment of Mann Frankfort Stein & Lipp as
the Company's independent auditors requires the affirmative vote of a majority
of the outstanding shares of Common Stock represented and entitled to vote at
the Annual Meeting.
THE BOARD UNANIMOUSLY RECOMMENDS THAT EACH STOCKHOLDER VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF MANN FRANKFORT STEIN & LIPP AS THE
INDEPENDENT AUDITORS OF THE COMPANY.
16
<PAGE>
PRINCIPAL HOLDERS OF COMMON STOCK
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of March 31, 2000, by (i) each
director, (ii) each of the Named Executives, (iii) each person who is known by
the Company to own beneficially 5% or more of the Common Stock, and (iv) all
directors and executive officers as a group. Unless otherwise indicated, each
person has sole voting and dispositive power over the shares indicated as owned
by such person.
<TABLE>
<CAPTION>
Number of Percentage
Shares Beneficially Owned
------------ -------------------
<S> <C> <C>
John B. Barnes..................... 150,791 3.0%
William H. Bruecher, Jr............ 24,442 *
C. Joe Chapman..................... 62,252 1.3
James K. Chancelor................. 23,000 *
Frank G. Cook...................... 159,616 3.2
Robert C. Dawson................... 52,290 1.1
Randall W. Dobbs................... 28,153(1) *
James B. Earthman III.............. 64,854 1.3
Lura M. Griffin.................... 20,328 *
Alton L. Hollis.................... 87,296 1.8
Joseph E. Ives..................... 21,186 *
Larry L. January................... 67,000 1.4
Albert V. Kochran.................. 25,686(2) *
I.W. Marks......................... 238,580(3) 4.8
David E. Preng..................... 186,200(4) 3.8
Mary A. Walker..................... 44,651(5) *
B. Ralph Williams.................. 100,809(6) 2.0
Directors and Executive Officers
as a Group (21 persons).......... 1,366,814(7) 27.6
- ------------
</TABLE>
* Does not exceed 1.0%.
(1) Includes 4,903 shares that may be acquired within 60 days pursuant to
outstanding stock options.
(2) Includes 17,649 shares owned by Kochran Family Living Trust.
(3) Mr. Marks address is 3841 Bellaire Boulevard, Houston, Texas 77025.
(4) Includes 11,000 shares owned by Mr. Preng's spouse.
(5) Includes 10,890 shares that may be acquired within 60 days pursuant to
outstanding stock options.
(6) Includes 9,040 shares that may be acquired within 60 days pursuant to
outstanding stock options.
(7) Includes 34,513 shares that may be acquired within 60 days pursuant to
outstanding stock options.
17
<PAGE>
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Any record or beneficial owner of Common Stock, in accordance with and
subject to the provisions of the proxy rules of the SEC and the Bylaws of the
Company, may submit proposals on proper subjects for action at the 2001 Annual
Meeting of Stockholders of the Holding Company. All such proposals must be
mailed to CNBT Bancshares, Inc., 5320 Bellaire Boulevard, Bellaire, Texas 77401,
attention: Randall W. Dobbs, and must be received at that address no later that
December 1, 2000, in order to be considered for inclusion in the Company's proxy
statement and form of proxy relating to the 2001 Annual Meeting. Submission of a
stockholder proposal does not guarantee inclusion in the Company's proxy
statement or form of proxy because certain SEC rules must be met.
Under the Company's Bylaws, nominations for director may be made only by the
Board of Directors or by a stockholder entitled to vote who delivers a notice to
the Company not less than 60 days nor more than 90 days prior to the date of an
annual meeting. For the Company's meeting in the year 2001, the Company must
receive this notice on or after February 20, 2001, and on or before March 22,
2001.
The Bylaws also provide that no business may be brought before an annual
meeting unless it has been properly brought before the meeting. To be properly
brought before the meeting a stockholder must deliver a written notice to the
Company of the stockholder's intention to present a proposal (containing certain
information specified in the Bylaws) within the time limits described above for
delivering of notice of a nomination for the election of a director. These
requirements apply to any matter that a stockholder wishes to raise at an annual
meeting other than pursuant to the procedures in SEC Rule 14a-8. The chairman of
the meeting will determine if a proposal is properly brought before the meeting
and if it is determined that a proposal is not properly brought before the
meeting, no action shall be taken on such proposal.
The proxy solicited by the Board of Directors for the 2001 Annual Meeting of
Stockholders will confer discretionary authority to vote on any stockholder
proposal presented at that meeting, unless the Company is provided with notice
of such proposal no later than February 15, 2001.
A copy of the full text of the Bylaws provisions discussed above may be
obtained by writing to CNBT Bancshares, Inc., 5320 Bellaire Boulevard, Bellaire,
Texas 77401, attention: Randall W. Dobbs
ANNUAL REPORT
The financial statements of the Company are contained in the 1999 Annual
Report to Stockholders, which has been provided to the stockholders concurrently
herewith. Such report and the financial statements contained therein are not to
be considered as a part of this soliciting material. Copies of the Company's
Annual Report to Stockholders and Annual Report on Form 10-K for the year ended
December 31, 1999, are available without charge upon request. Please direct your
request to CNBT Bancshares, Inc., Attention: Investor Relations, 5320 Bellaire
Boulevard, Bellaire, Texas 77401, (713) 661-4444.
18
<PAGE>
OTHER MATTERS
The Board knows of no matters other than those listed in the attached Notice
of Annual Meeting which are likely to come before the Annual Meeting. However,
if any other matter properly comes before the Annual Meeting, the persons named
on the enclosed proxy card will vote the proxy in accordance with their best
judgment on such matters.
In the event that sufficient votes in favor of the proposals set forth in the
Notice of the Annual Meeting of Stockholders and Proxy Statement are not
received by the time scheduled for the Annual Meeting, the individuals named as
proxies may move for one or more adjournments of the Annual Meeting to permit
further solicitation of proxies with respect to any such proposals.
19
<PAGE>
CNBT BANCSHARES, INC.
5320 Bellaire Boulevard
Bellaire, Texas 77401
This Proxy is solicited on behalf of the Board of Directors of CNBT
Bancshares, Inc. (the "Company") for the Annual Meeting of Stockholders on May
23, 2000.
The undersigned hereby constitutes and appoints B. Ralph Williams or Frank
G. Cook, or either of them, with full power of substitution and revocation to
each, the true and lawful attorneys and proxies of the undersigned at the Annual
Meeting of Stockholders of CNBT Bancshares, Inc. to be held on May 23, 2000, at
3:00 p.m. local time, at 5320 Bellaire Boulevard, Bellaire, Texas 77401, or any
adjournment thereof (the "Annual Meeting") and to vote the shares of Common
Stock, $1.00 par value per share, of the Company ("Shares"), standing in the
name of the undersigned on the books of the Company on March 31, 2000, the
record date for the Annual Meeting, with all powers the undersigned would
possess if personally present at the Annual Meeting.
The undersigned hereby acknowledges previous receipt of the Notice of
Annual Meeting of Stockholders and the Proxy Statement and hereby revokes any
proxy or proxies heretofore given by the undersigned.
_______________________________________________________________________________
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE NOMINEES
AND FOR PROPOSAL 2 AND IF NO SPECIFICATION IS MADE, THE SHARES WILL BE VOTED FOR
SAID NOMINEES AND PROPOSALS.
1. Election of Directors. The seventeen nominees for a one-year term or until
their successors are elected and shall qualify are: John B. Barnes, William
H. Bruecher, Jr., James K. Chancelor, C. Joe Chapman, Frank G. Cook, Robert
C. Dawson, Randall W. Dobbs, James B. Earthman, III, Lura M. Griffin, Alton
L. Hollis, Joseph E. Ives, Larry L. January, Albert V. Kochran, I.W. Marks,
David E. Preng, Mary A. Walker, and B. Ralph Williams. You may withhold
authority to vote for any nominee as you indicate below:
FOR _______ WITHHELD _______ _____________________________________
FOR ALL NOMINEES EXCEPT AS NOTED
2. Ratification of the appointment of Mann Frankfort Stein & Lipp as the
independent auditors of the Bank for the fiscal year ending December 31,
2000:
FOR __________ AGAINST ___________ ABSTAIN ___________
3. In their discretion, the proxies are authorized to vote upon such other
matters as may properly come before the meeting.
FOR __________ AGAINST ___________ ABSTAIN ___________
Please sign exactly as name appears hereon. When
shares are held by joint tenants both should sign.
When signing as attorney, executor, administrator,
trustee, or guardian, please give full title as
such. If a corporation, please sign in full
corporate name by President or other authorized
officer. If a partnership, please sign in
partnership name by authorized persons.
Date_____________________________________
Signature _________________________________
Signature _________________________________
