SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-K/A
X ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [Fee Required]
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
___ TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [No Fee Required]
FOR THE TRANSITION PERIOD FROM _______ to _______
Commission File Number 0-7275
CULLEN/FROST BANKERS, INC.
(Exact name of registrant as specified in its charter)
Texas 74-1751768
- ------------------------------- -----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
100 W. Houston Street
San Antonio, Texas 78205
- ------------------------------- -------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (210) 220-4011
Securities registered pursuant to Section 12(b) of the Act: None.
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $5 Par Value
(with attached rights)
--------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
--- ----
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X
---
The aggregate market value of the voting stock held by non-affiliates of
the registrant was $532,348,838 based on the closing price of such stock as of
March 25, 1996.
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
Outstanding at
Class March 25, 1996
-------------------------- --------------
Common Stock, $5 par value 11,213,693
DOCUMENTS INCORPORATED BY REFERENCE
(1) Annual Report to Shareholders for the Year Ended December 31, 1995 (Parts I
& II)
(2) Proxy Statement for Annual Meeting of Shareholders to be held May 29, 1996
(Part III)
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
AMENDMENT TO APPLICATION OR REPORT
FILED PURSUANT TO SECTION 12,13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
CULLEN/FROST BANKERS, INC.
(Exact name of registrant as specified in its charter)
AMENDMENT NO. 1
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 as set forth in the pages attached
hereto:
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
1. Financial Statements--Reference is made to Part II, Item 8 of this Annual
Report on Form 10-K. In addition, pursuant to Rule 15d-21 under the
Securities Exchange Act of 1934 the financial statements and supplemental
schedules required by Form 11-K with respect to the 1991 Thrift Incentive
Stock Purchase Plan for Employees of Cullen/Frost Bankers, Inc. are filed
herewith as Exhibit 19.1 to this Annual Report on Form 10-K.
2. Exhibits--The following additional exhibits are filed herewith as a part of
this Amendment No. 1 to the registrant's Annual Report on Form 10-K.
3.2 Amended By-Laws of Cullen/Frost Bankers, Inc.
19.1 The financial statements and exhibits required by Form 11-K with
respect to the 1991 Thrift Incentive Stock Purchase Plan for Employees
of Cullen/Frost Bankers, Inc. for the fiscal years ended December 31,
1995 and 1994.
23.2 Consent of Independent Auditors with respect to Form 11-K for the 1991
Thrift Incentive Stock Purchase Plan.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
Cullen/Frost Bankers, Inc.
--------------------------
(Registrant)
Date: April 29, 1996 By:/s/Phillip D. Green
-----------------------
Phillip D. Green
Executive Vice President
and Treasurer
(Duly Authorized Officer and
Principal Accounting Officer)
<PAGE>
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
- --------------------------------------------------------------------------
(a) The following documents are filed as part of this Annual Report on Form
10-K:
1. Financial Statements -- Reference is made to Part II, Item 8, of this
Annual Report on Form 10-K.
2. The Financial Statement Schedules are omitted, as the required information
is not applicable.
3. Exhibits -- The following exhibits are filed as a part of this Annual
Report on Form 10-K:
Exhibit
Number
-------
3.1 Restated Articles of Incorporation, as amended (1988 Form S-8,
Exhibit 4(a))(3)
3.2 Amended By-Laws of Cullen/Frost Bankers, Inc.
4.1 Guaranty, dated April 27, 1981, by Cullen/Frost Bankers, Inc. to
Colonial/Citizens Associates (1985 Form S-8, Exhibit 4(e))(1)
4.2 Shareholder Protection Rights Agreement dated as of July 25, 1989
between Cullen/Frost Bankers, Inc. and The Bank of New York, as
Rights Agent (1989 Form 8-K, Exhibit 1)(5)
10.1 1983 Non-qualified Stock Option Plan, as amended (1989 Form S-8,
Exhibit 4(g))(6)
10.2 Restoration of Retirement Income Plan for Participants in the
Retirement Plan for Employees of Cullen/Frost Bankers, Inc. and its
Affiliates (as amended and restated)(1988 Form 10-K, Exhibit
10.4)(4)*
10.3 Contract of Sale, dated June 9, 1987, between The Frost National
Bank of San Antonio and Tower Investors, Ltd. for the sale of the
Frost Bank Tower (1987 Form 10-K, Exhibit 10.10)(2)
10.4 Master Lease, dated June 9, 1987, between The Frost National Bank
of San Antonio and Tower Investments, Ltd. for the lease of the
Frost Bank Tower (1987 Form 10-K, Exhibit 10.11)(2)
10.5 Form of Revised Change-In-Control Agreements with four Executive
Officers (1989 Form 10-K, Exhibit 10.13(a))(8)*
10.6 1988 Non-qualified Stock Option Plan (1989 Form S-8, Exhibit
4(g))(7)
10.7 The 401(k) Stock Purchase Plan for employees of Cullen/Frost
Bankers, Inc. and its Affiliates (1990 Form S-8, Exhibit 4(g))(9)*
10.8 1991 Thrift Incentive Stock Purchase Plan for Employees of
Cullen/Frost Bankers, Inc. and its Affiliates (1991 Form S-8,
Exhibit 4(g))(10)*
10.9 Cullen/Frost Bankers, Inc. Restricted Stock Plan (1992 Form S-8,
Exhibit 4(d))(11)*
10.10 Cullen/Frost Bankers, Inc. 1992 Stock Plan (1992 Form S-8, Exhibit
4(d))(12)
10.11 Cullen/Frost Bankers, Inc. Supplemental Executive Retirement Plan
(1994 Form 10-K, Exhibit 10.13)(13)
10.12 Form of Revised Change-in-Control Agreements with one Executive
Officer (1994 Form 10-K, Exhibit 10.14)(13)
11 Statement re: computation of earnings per share
13 The Cullen/Frost 1995 Annual Report to Shareholders for the Year
Ended December 31, 1995, (furnished for the information of the
Commission and not deemed to be "filed" except for the portion
expressly incorporated by reference)
19.1 Annual Report on Form 11-K for the Year Ended December 31, 1995,
for the 1991 Thrift Incentive Stock Purchase Plan (filed pursuant
to Rule 15d-21 of the Securities and Exchange Act of 1934)(14)
12
<PAGE>
19.2 Annual Report on Form 11-K for the Year Ended December 31, 1995,
for the 401(k) Stock Purchase Plan (filed pursuant to Rule 15d-21
of the Securities and Exchange Act of 1934)(14)
21 Subsidiaries of Cullen/Frost
23 Consent of Independent Auditors
24 Power of Attorney
* Management contract or compensatory plan or arrangement required to be filed
as an exhibit pursuant to Item 601 of Regulation S-K.
(b) Reports on Form 8-K -- No such reports were filed during the quarter ended
December 31, 1995.
- ----------------------
(1) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed December 18, 1985
(File No. 33-2271)
(2) Incorporated herein by reference to the designated Exhibits to the
Cullen/Frost Annual Report on Form 10-K for the Year Ended
December 31, 1987 (File No. 0-7275)
(3) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed June 24, 1988
(File No. 33-22758)
(4) Incorporated herein by reference to the designated Exhibits to the
Cullen/Frost Annual Report on Form 10-K for the Year Ended
December 31, 1988 (File No. 0-7275)
(5) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Current Report on Form 8-K dated July 25, 1989
(File No. 0-7275)
(6) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed September 5, 1989
(File No. 33-30776)
(7) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed September 5, 1989
(File No. 33-30777)
(8) Incorporated herein by reference to the designated Exhibits to the
Cullen/Frost Annual Report on Form 10-K for the Year Ended
December 31, 1989 (File No. 0-7275)
(9) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed October 31, 1990
(File No. 33-37500)
(10) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed March 18, 1991
(File No. 33-39478)
(11) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed October 20, 1992
(File No. 33-53492)
(12) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Report on Form S-8 filed October 23, 1992
(File No. 33-53622)
(13) Incorporated herein by reference to the designated Exhibits to
Cullen/Frost's Annual Report on Form 10-K for the Year-Ended
December 31, 1994 (File No. 0-7275)
(14) To be filed as an amendment.
13
<PAGE>
EXHIBIT INDEX TO FORM 10-K/A
Exhibit
Number Description of Exhibits
- ------------------------------------------
3.2 Amended By-Laws of Cullen/Frost Bankers, Inc.
19.1 The financial statements and exhibits required by Form 11-K with
respect to the 1991 Thrift Incentive Stock Purchase Plan for Employees
of Cullen/Frost Bankers, Inc. for the fiscal years ended December 31,
1995 and 1994 (filed pursuant to Rule 15d-21 of the Securities and
Exchange Act of 1934)
23.2 Consent of Independent Auditors with respect to Form 11-K for the 1991
Thrift Incentive Stock Purchase Plan.
EXHIBIT 3.2
Amended By-Laws of Cullen/Frost Bankers, Inc.
<PAGE>
BYLAWS
OF
CULLEN/FROST BANKERS, INC.
ARTICLE I - OFFICES
-------------------
SECTION 1.1 - REGISTERED OFFICE: The registered office of the corporation
shall be at 100 W. Houston Street, San Antonio, Texas.
SECTION 1.2 - EXECUTIVE OFFICES: The executive offices of the corporation
shall be at 100 W. Houston Street, San Antonio, Texas.
SECTION 1.3 - OTHER OFFICES: The corporation may also have offices at such
other places as the Board of Directors may from time to time determine or the
business of the corporation may require.
ARTICLE II - SHAREHOLDERS
-------------------------
SECTION 2.1 - ANNUAL MEETING: The annual meeting of the shareholders for the
purpose of electing Directors shall be on such date as shall be fixed by the
Board of Directors. Any business may be transacted at an annual meeting to the
extent permitted by law and these bylaws.
SECTION 2.2 - SPECIAL MEETING: A special meeting of the shareholders may be
called at any time by the holders of at least ten percent (10%) of the
outstanding stock entitled to be voted at such meeting, by the Board of
Directors, by the Senior Chairman of the Board, by the Chairman of the Board or
by the President. Upon receipt at the corporation's executive offices of a
request to call a special meeting (and a notice calling a meeting shall be
deemed to constitute a request), the Board of Directors shall, within fifteen
(15) days, set a record date, not later than ten (10) days from the date of
such board action, to determine shareholders entitled to call a special
meeting. If the board fails to set such record date, the record date shall be
the date the first shareholder signs the notice of such meeting. Only such
business shall be transacted at a special meeting as may be stated in the
notice of such meeting.
<PAGE>
SECTION 2.3 - PLACE: The annual meeting and any special meeting of the
shareholders shall be held at such place as is designated by the Board of
Directors.
SECTION 2.4 - NOTICE: Written or printed notice stating the place, day and
hour of each meeting of shareholders and, in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered, in the
case of an annual meeting or a special meeting not called by shareholders, not
less than ten (10) nor more than sixty (60) days before the date of the
meeting, and, in the case of a special meeting called by shareholders, not less
than fifty (50) nor more than sixty (60) days before the date of the meeting,
in each case either personally or by mail, to each shareholder of record
entitled to vote at such meeting.
SECTION 2.5 - QUORUM: The holders of a majority of the shares issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall be requisite and shall constitute a quorum at all meetings of the
shareholders for the transaction of business except as otherwise provided by
statute, by the articles of incorporation or by these bylaws. If, however,
such quorum shall not be present or represented at any meeting of the
shareholders, the shareholders entitled to vote thereat, present in person or
by proxy, shall have power to adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be present
or represented. At such adjourned meeting at which a quorum shall be present
or represented any business may be transacted which might have been transacted
at the meeting as originally notified. When a quorum is present at any
meeting, the vote of the holders of a majority of the shares having voting
power present in person or represented by proxy shall decide any question
brought before such meeting, unless the question is one upon which by
express provision of the statutes, of any stock exchange or the National
Association of Securities Dealers, Inc. or of the articles of incorporation or
of these bylaws, a different vote is required in which case such express
provision shall govern and control the decision of such question. The
shareholders present at a duly organized meeting may not continue to transact
business following the withdrawal of enough shareholders to leave less than a
quorum.
<PAGE>
SECTION 2.6 - PROXIES: At all meetings of shareholders, a shareholder may vote
either in person or by proxy executed in writing by the shareholder or by his
duly authorized attorney-in-fact. Such proxies shall be filed with the
Secretary of the corporation before or at the time of the meeting. No proxy
shall be valid after eleven (11) months from the date of its execution unless
otherwise provided in the proxy. Each proxy shall be revocable unless
expressly provided therein to be irrevocable, and unless otherwise made
irrevocable by law.
SECTION 2.7 - VOTES PER SHARES AND CUMULATIVE VOTING: Each outstanding share,
regardless of class, shall be entitled to one vote on each matter submitted to
a vote at a meeting of shareholders, except to the extent that the voting
rights of the shares of any class or classes are limited or denied by the
articles of incorporation, or as otherwise provided by the Texas Business
Corporation Act. At each election of Directors every shareholder entitled to
vote at such election shall have the right to vote, in person or by proxy, the
number of shares owned by him for as many persons as there are Directors to be
elected and for whose election he has a right to vote. Directors shall be
elected by a plurality of the votes cast. It is expressly prohibited for any
shareholder to cumulate his votes in any election of Directors for any other
purpose.
SECTION 2.8 - PRESIDING OFFICERS: The Senior Chairman of the Board shall
preside at and the Secretary shall keep the records of each meeting of
shareholders, and in the absence of the Senior Chairman, his duties shall be
performed by the Chairman of the Board and in his absence, the President. In
the absence of the Secretary, his duties shall be performed by the Assistant
Secretary. The order of business at each such meeting shall be as determined
by the presiding officer of the meeting. The presiding officer of the meeting
shall have the right and authority to prescribe such rules, regulations and
procedures and to do all such acts and things as are necessary or desirable for
the proper conduct of the meeting, including, without limitation, the
establishment of procedures for the maintenance of order and safety,
limitations on the time allotted to questions or comments on the affairs of the
corporation, restrictions on entry to such meeting after the time prescribed
for the commencement thereof and the opening and closing of the voting polls.
<PAGE>
SECTION 2.9 - LIST OF SHAREHOLDERS: A complete list of shareholders entitled
to vote at each shareholders' meeting, arranged in alphabetical order, with the
address of and number of shares held by each, shall be prepared by the
Secretary and filed at the registered office and the executive offices of the
corporation and subject to inspection by any shareholder during usual business
hours for a period of ten (10) days prior to such meeting. Such list shall be
produced and subject to inspection by any shareholder during such meeting.
SECTION 2.10 - ADVANCE NOTICE OF SHAREHOLDER PROPOSALS: Following the 1996
Annual Meeting, at any annual or special meeting of shareholders, proposals by
shareholders and nominations for directors made by shareholders shall be
considered only if advance notice thereof has been timely given as provided
herein and such proposals or nominations are otherwise proper for consideration
under applicable law and the articles of incorporation and the bylaws. Notice
of any proposal to be presented by any shareholder or of the name of any person
to be nominated by any shareholder for election as a director of the
corporation at any meeting of shareholders shall be delivered to the Secretary
of the corporation at its executive offices not less than sixty (60) nor more
than ninety (90) days prior to the date of the meeting; provided, however, that
if the date of the meeting is first publicly announced or disclosed (in a
public filing or otherwise) less than seventy (70) days prior to the date of
the meeting, such advance notice shall be given not more than ten (10) days
after such date is first so announced or disclosed. Public notice shall be
deemed to have been given seventy (70) days or more in advance of the annual
meeting if the corporation shall have previously disclosed, in these bylaws or
otherwise, that the annual meeting in each year is to be held on a determinable
date, unless and until the Board determines to hold the meeting on a different
date. Any shareholder who gives notice of any such proposal shall deliver
therewith the text of the proposal to be presented and a brief written
statement of the reasons why such shareholder favors the proposal and setting
forth such shareholder's name and address, the number and class of all shares
of each class of stock of the corporation beneficially owned by such
shareholder and any material interest of such shareholder in the proposal
(other than as a shareholder). Any shareholder desiring to nominate any person
for election as a director of the corporation shall deliver with such notice a
statement in writing setting forth the name of the person to be nominated, the
number and class of all shares of each class of stock of the corporation
<PAGE>
beneficially owned by such person, the information regarding such person
required by paragraphs (a), (e) and (f) of Item 401 of Regulation S-K adopted
by the Securities and Exchange Commission (or the corresponding provisions of
any regulation subsequently adopted by the Securities and Exchange Commission
applicable to the corporation), such person's signed consent to serve as a
director of the corporation if elected, such shareholder's name and address and
the number and class of all shares of each class of stock of the corporation
beneficially owned by such shareholder. As used herein, shares "beneficially
owned" shall mean all shares as to which such person, together with such
person's affiliates and associates (as defined in Rule 12b-2 under the
Securities Exchange Act of 1934), may be deemed to beneficially own pursuant to
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as well as all
shares as to which such person, together with such person's affiliates and
associates, has the right to become the beneficial owner pursuant to any
agreement or understanding, or upon the exercise of warrants, options or rights
to convert or exchange (whether such rights are exercisable immediately or only
after the passage of time or the occurrence of conditions). The person
presiding at the meeting, in addition to making any other determinations that
may be appropriate to the conduct of the meeting, shall determine whether such
notice has been duly given and shall direct that proposals and nominees not be
considered if such notice has not been given.
ARTICLE III - BOARD OF DIRECTORS
--------------------------------
SECTION 3.1 - POWERS: The business and property of the corporation shall be
managed by the Board of Directors, and subject to the restrictions imposed by
law, by the articles of incorporation, or by these bylaws, they may exercise
all the powers of the corporation.
SECTION 3.2 - NUMBER: The Board of Directors shall consist of one or more
members, the number thereof to be determined from time to time by the Board.
SECTION 3.3 - ELECTION; TERM; RESIGNATION; REMOVAL; VACANCIES: Commencing with
the 1996 Annual Meeting, the Directors shall be divided into three classes,
designated Class I, Class II and Class III, with the term of Class I initially
expiring in 1997, the term of Class II initially expiring in 1998 and the term
<PAGE>
of Class III initially expiring in 1999. After such initial expiration dates,
each class shall be elected for a three-year term. Each class shall be as
nearly equal in number as possible. Each Director shall hold office until the
next election of the class for which such Director shall have been chosen, and
until his or her successor is elected and qualified or until his or her earlier
resignation or removal. Any Director may resign at any time upon written
notice to the Board of Directors or to the Senior Chairman, Chairman, President
or Secretary of the Corporation. Such resignation shall take effect at the
time specified therein, and unless otherwise specified therein no acceptance of
such resignation shall be necessary to make it effective. Any Director or,
subject to the following sentence, the entire Board of Directors may be
removed, only for cause, by the holders of two-thirds of the shares then
entitled to vote for the election of such Directors. Whenever the holders of
any class or series of stock are entitled to elect one or more Directors by the
articles of incorporation, the provisions of the preceding sentence shall
apply, in respect to the removal of a Director or Directors so elected, to the
vote of the holders of the outstanding shares of that class or series and not
to the vote of the outstanding shares as a whole. Vacancies and newly created
directorships resulting from any increase in the authorized number of directors
elected by all of the stockholders having the right to vote or from any other
cause may be filled by a majority of the directors then in office, although
less than a quorum or by election at an annual or special meeting of
shareholders called for such purpose. Whenever the holders of any class or
classes of stock or series thereof are entitled to elect one or more Directors
by the articles of incorporation, vacancies and newly created directorships of
such class or classes or series may be filled by a majority of the directors
elected by such class or classes or series thereof then in office, or by the
sole remaining director so elected or by the vote of the holders of such class
or classes or series of stock. Any Director elected or appointed to fill a
vacancy by reason of an increase in the number of Directors shall hold office
until the next election of Directors by the shareholders, provided that the
Board of Directors may not fill more than two such directorships during the
period between two successive annual meetings of shareholders. Any other
Directors elected to fill vacancies shall hold office until the next election
of the class of Directors of the Director which such Director replaced, and
until and his or her successor is elected and qualified or until his or her
earlier resignation or removal.
<PAGE>
SECTION 3.4 - MEETING OF DIRECTORS: The Directors may hold their meetings and
may have an office and keep the books of the corporation, except as otherwise
provided by statute, in such place or places, as the Board of Directors may
from time to time determine.
SECTION 3.5 - ORGANIZATIONAL MEETING: Other than the first meeting of the
initial Board of Directors, each newly elected Board of Directors may hold its
first meeting for the purpose of organization and the transaction of business,
if a quorum is present, immediately after and at the same place as the annual
meeting of the shareholders, and no notice of such meeting shall be necessary.
SECTION 3.6 - ELECTION OF OFFICERS: At the first meeting of the Board of
Directors in each year at which a quorum shall be present, held next after the
annual meeting of shareholders, the Board of Directors shall proceed to the
election of the officers of the corporation.
SECTION 3.7 - REGULAR MEETINGS: Regular meetings of the Board of Directors
shall be held at such times and places as shall be designated, from time to
time by resolution of the Board of Directors.
SECTION 3.8 - SPECIAL MEETINGS: Special meetings of the Board of Directors may
be called by the Senior Chairman, the Chairman or the President or on the
written request of a majority of the Directors.
SECTION 3.9 - NOTICE: Notice of such regular meetings shall not be required.
The Secretary shall give notice of each special meeting in person, or by
telephone, mail, telegraph, or facsimile at least one (1) day before the
meeting to each Director. The attendance of a Director at any meeting shall
constitute a waiver of notice of such meeting, except where a Director attends
a meeting for the express purpose of objecting to the transaction of any
business on the grounds that the meeting is not lawfully called or convened.
Neither the business to be transacted at, nor the purpose of, special meeting
of the Board of Directors need be specified in the notice or waiver of notice
of such meeting.
SECTION 3.10 - QUORUM: A majority of the Directors fixed in the manner
provided in these bylaws shall constitute a quorum for the transaction of
business, but if at any meeting of the Board of Directors there be less than a
<PAGE>
quorum present, a majority of those present or any Director solely present may
adjourn the meeting from time to time without further notice. The act of a
majority of the Directors present at a meeting at which a quorum is in
attendance shall be the act of the Board of Directors, unless the act of a
greater number is required by the articles of incorporation or by these bylaws.
SECTION 3.11 - ORDER OF BUSINESS: At meetings of the Board of Directors,
business shall be transacted in such order as from time to time the Senior
Chairman may determine.
SECTION 3.12 - COMPENSATION: Directors as such shall not receive any stated
salary for their service, but by resolution of the Board a fixed sum and
expense of attendance, if any, may be allowed for attendance at such regular or
special meetings of the Board; provided that nothing contained herein shall be
construed to preclude any Director from serving the corporation in any other
capacity or receiving compensation therefor.
SECTION 3.13 - PRESUMPTION OF ASSENT: A Director of the corporation who is
present at a meeting of the Board of Directors at which action on any
corporation matter is taken shall be presumed to have assented to the action
unless his dissent shall be entered in the minutes of the meeting or unless he
shall file his written dissent to such action with the person acting as
Secretary of the meeting before the adjournment thereof or shall forward such
dissent by registered mail to the Secretary of the corporation immediately
after the adjournment of the meeting. Such right to dissent shall not apply to
a Director who voted in favor of such action.
SECTION 3.14 - EXECUTIVE COMMITTEE AND OTHER COMMITTEES: The Board of
Directors by resolution adopted by a majority of the full Board of Directors,
may designate from among its members an Executive Committee and one or more
committees, each of which, to the extent provided in such resolution, shall
have and may exercise all of the authority of the Board of Directors except
that no committee shall have the authority of the Board of Directors in those
matters specifically prohibited by Art. 2.36 of the Texas Business Corporation
Act. The designation of any such committee and the delegation thereto of
authority shall not operate to relieve the Board of Directors, or any member
thereof, of any responsibility imposed by law. Each committee shall keep
<PAGE>
regular minutes of its meetings and report the same to the Board of Directors
at the Board's next meeting.
ARTICLE IV - OFFICERS
---------------------
SECTION 4.1 - OFFICERS; ELECTION: As soon as practicable after the annual
meeting of shareholders in each year, the Board of Directors shall elect a
President and a Secretary, and it may, if it so determines, elect from among
its members a Senior Chairman of the Board, a Chairman of the Board and one or
more Vice Chairmen of the Board. The Board may also elect one or more Vice
Presidents, one or more Assistant Vice Presidents, one or more Assistant
Secretaries, a Treasurer and one or more Assistant Treasurers and such other
officers as the Board may deem desirable or appropriate and may give any of
them such further designations or alternate titles as it considers desirable.
Any number of offices may be held by the same person unless the articles of
incorporation or these bylaws otherwise provide.
SECTION 4.2 - TERM OF OFFICE; RESIGNATION; REMOVAL; VACANCIES: Unless
otherwise provided in the resolution of the Board of Directors electing any
officer, each officer shall hold office until his or her successor is elected
and qualified or until his or her earlier resignation or removal. Any officer
may resign at any time upon written notice to the Board or to the Senior
Chairman, Chairman, President or Secretary. Such resignation shall take effect
at the time specified therein, and unless otherwise specified therein no
acceptance of such resignation shall be necessary to make it effective. The
Board may remove any officer with or without cause at any time. Any such
removal shall be without prejudice to the contractual rights of such officer,
if any, with the corporation, but the election of an officer shall not of
itself create contractual rights. Any vacancy occurring in any office of the
corporation by death, resignation, removal or otherwise may be filled by the
Board at any regular or special meeting.
SECTION 4.3 - POWERS AND DUTIES: The officers of the corporation shall have
such powers and duties in the management of the corporation as shall be stated
in these bylaws or in a resolution of the Board of Directors which is not
inconsistent with these bylaws and, to the extent not so stated, as generally
pertain to their respective offices, subject to the control of the Board. The
<PAGE>
Secretary shall have the duty to record the proceedings of the meetings of the
stockholders, the Board of Directors and any committees in a book to be kept
for that purpose. The Board may require any officer, agent or employee to give
security for the faithful performance of his or her duties.
ARTICLE V - INDEMNIFICATION OF DIRECTORS AND OFFICERS
------------------------------------------------------
SECTION 5.1 - IN GENERAL: The corporation shall, to the fullest extent to
which it is empowered to do so by the Texas Business Corporation Act and any
other applicable laws as may from time to time be in effect, indemnify any
person who was, is or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he or she is or was
a director or officer of the corporation, or is or was serving at the request
of the corporation as a director, officer, partner, venturer, proprietary,
trustee, employee, agent or similar functionary of another foreign or domestic
corporation, partnership, joint venture, trust or other enterprise, against all
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding. The corporation's obligations under this section
include, but are not limited to, the convening of any meeting, and the
consideration of any matter thereby, required by statute in order to determine
the eligibility of an officer or director for indemnification. Reasonable
expenses incurred in defending a civil or criminal action, suit or proceeding
shall be paid by the corporation in advance of the final disposition of such
action, suit or proceeding upon receipt of (i) a written affirmation by the
director, officer, employee or agent who may be entitled to such
indemnification of his or her good faith belief that he or she has met the
standard of conduct necessary for indemnification under the applicable statute,
and (ii) a written undertaking by or behalf of the director, officer, employee
or agent who may be entitled to such indemnification, to repay such amount if
it shall ultimately be determined that he or she is not entitled to be
indemnified by the corporation. The corporation's obligation to indemnify and
to prepay expenses under this Section 5.1 shall arise, and all rights granted
to directors, officers, employees or agents hereunder shall vest, at the time
of the occurrence of the transaction or event to which such action, suit or
<PAGE>
proceeding relates, or at the time that the action or conduct to which such
action, suit or proceeding relates was first taken or engaged (or omitted to be
taken or engaged in), regardless of when such action, suit or proceeding is
first threatened, commenced or completed. Notwithstanding any other provision
of these bylaws or the Articles of Incorporation of the corporation, no action
taken by the corporation, either by amendment of the bylaws or the Articles of
Incorporation of the corporation or otherwise, shall diminish or adversely
affect any rights to indemnification or prepayment of expenses granted under
this Section 5.1 which shall have become vested as aforesaid prior to the date
that such amendment or other corporate action is taken. Further, if any
provision of this Section 5.1 shall be held to be invalid or unenforceable, the
validity and enforceability of the remaining provisions shall not in any way be
affected or impaired.
ARTICLE VI - CAPITAL STOCK
--------------------------
SECTION 6.1 - CERTIFICATES OF SHARES: The certificates for shares of the
capital stock of the corporation shall be in such form as shall be approved by
the Board of Directors. The certificates shall be signed by the Senior
Chairman or Chairman of the Board or the President or a Vice-President, and
also by the Secretary or an Assistant Secretary or by the Treasurer or an
Assistant Treasurer and may be sealed with the seal of this corporation or a
facsimile thereof. They shall be consecutively numbered and shall be entered
in the books of the corporation as they are issued and shall exhibit the
holder's name and the number of shares.
SECTION 6.2 - TRANSFER OF SHARES: The shares of stock of the corporation shall
be transferable only on the books of the corporation by the holders thereof in
person or by their duly authorized attorneys or legal representatives, upon
surrender and cancellation of certificates for a like number of shares.
SECTION 6.3 - REGULATIONS: The Board of Directors shall have power and
authority to make all such rules and regulations as they may deem expedient
concerning the issue, transfer and registration or the replacement of
certificates for shares of the capital stock of the corporation.
<PAGE>
ARTICLE VII - MISCELLANEOUS PROVISIONS
--------------------------------------
SECTION 7.1 - FISCAL YEAR: The fiscal year of the corporation shall be such as
the Board of Directors shall by resolution, establish.
SECTION 7.2 - SEAL: The seal of the corporation shall be such as from time to
time may be approved by the Board of Directors.
SECTION 7.3 - NOTICE AND WAIVER OF NOTICE: Whenever any notice whatsoever is
required to be given to shareholders under the provisions of these bylaws, said
notice shall be deemed to be sufficient if given by depositing the same in a
post office box in a sealed postpaid wrapper addressed to the person entitled
thereto at his post office address, as it appears on the books of the
corporation, and such notice shall be deemed to have been given on the day of
such mailing. A waiver of notice, signed by the person or persons entitled to
said notice, whether before or after the time stated therein, shall be deemed
equivalent to the giving of such notice.
SECTION 7.4 - SECURITIES OF OTHER CORPORATIONS: The President (or any Vice-
President) of the corporation shall have power and authority to transfer,
endorse for transfer, vote, consent and take any other action with respect to
any securities of another issuer which may be held or owned by the corporation
and to make, execute and deliver any waiver, proxy or consent with respect to
any such securities.
SECTION 7.5 - DIVIDENDS: Dividends upon the outstanding shares of the
corporation, subject to the provision of the articles of incorporation, if any,
may be declared by the Board of Directors at any regular or special meeting.
Dividends may be paid in cash, property, or in shares of the corporation,
subject to the provisions of the Texas Business Corporation Act, and the
articles of incorporation.
SECTION 7.6 - CONTRACTS: The Board of Directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver
any instrument in the name of and on behalf of the corporation, and such
authority may be general or confined to specific instances.
SECTION 7.7 - BYLAWS: These bylaws may be altered, amended, or repealed and
new bylaws may be adopted by a vote of a majority of the number of Directors as
fixed in accordance with these bylaws or by a vote of the holders of three-
quarters of the outstanding shares entitled to vote thereon.
_______________________________________
EXHIBIT 19.1
The Financial Statements for the 1991 Thrift Incentive Stock
Purchase Plan for Employees of Cullen/Frost Bankers, Inc.
<PAGE>
1991 Thrift Incentive Stock Purchase
Plan for Employees of Cullen/Frost
Bankers, Inc.
Financial Statements
Years Ended December 31, 1995 and 1994
with Report of Independent Auditors
<PAGE>
1991 Thrift Incentive Stock Purchase Plan
for Employees of Cullen/Frost Bankers, Inc.
Financial Statements
Years Ended December 31, 1995 and 1994
Contents
Report of Independent Auditors...............................................1
Financial Statements
Statements of Net Assets Available for Benefits..............................2
Statements of Changes in Net Assets Available for Benefits...................3
Notes to Financial Statements................................................4
<PAGE>
Report of Independent Auditors
Compensation and Benefits Committee of
Cullen/Frost Bankers, Inc.
We have audited the accompanying statements of net assets available for
benefits of the 1991 Thrift Incentive Stock Purchase Plan for Employees of
Cullen/Frost Bankers, Inc. as of December 31, 1995 and 1994, and the related
statements of changes in net assets available for benefits for the years then
ended. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the 1991 Thrift
Incentive Stock Purchase Plan for Employees of Cullen/Frost Bankers, Inc. at
December 31, 1995 and 1994, and the changes in its net assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles.
/s/Ernst & Young LLP
April 2, 1996
1
<PAGE>
1991 Thrift Incentive Stock Purchase Plan
for Employees of Cullen/Frost Bankers, Inc.
Statements of Net Assets Available for Benefits
December 31
1995 1994
-------------
Assets $ - $ -
Liabilities - -
-------------
Net assets available for benefits $ - $ -
=============
See accompanying notes.
2
<PAGE>
1991 Thrift Incentive Stock Purchase Plan
for Employees of Cullen/Frost Bankers, Inc.
Statements of Changes in Net Assets Available for Benefits
December 31
1995 1994
------------------
Additions:
Employer contributions $595,162 $571,987
Employee contributions 29,637 36,429
Dividend Income 9,413 5,712
Interest Income 1,030 408
Gain(loss) on sale of investments 445 (181)
Appreciation (depreciation) in fair value of
Investments 105,477 (68,777)
-------------------
Total additions 741,164 545,578
Deductions:
Benefit payments 741,164 545,578
-------------------
Total deductions 741,164 545,578
Net assets available for benefits at beginning of year --- ---
-------------------
Net assets available for benefits at end of year $ --- $ ---
===================
See accompanying notes.
3
<PAGE>
1991 Thrift Incentive Stock Purchase Plan
for Employees of Cullen/Frost Bankers, Inc.
Notes to Financial Statements
December 31, 1995 and 1994
1. Significant Accounting Policies
The financial statements of the 1991 Thrift Incentive Stock Purchase Plan for
Employees of Cullen/Frost Bankers, Inc. (the Plan) are presented on the accrual
basis of accounting. Participating entities include: Cullen/Frost Bankers,
Inc. (CFBI); Frost National Bank; Cullen/Frost Bank of Dallas (through April
14, 1994) and United States National Bank, all of which are referred to herein
as "the Company."
The cost of a specific security sold is used to compute gains and losses on the
sale of investments.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.
2. Description of the Plan
The Plan, amended and restated on January 1, 1991, is a non-qualified
contributory plan. In addition to the Plan, the Company maintains the 401(k)
Stock Purchase Plan for Employees of Cullen/Frost Bankers, Inc. and its
Affiliates (the 401(k) Plan). The Plan covers substantially all eligible
employees who have been determined to be highly compensated employees with
respect to the plan year under the provisions of the 401(k) Plan regarding
discretionary matching contributions, and who have been designated by the
Plan's administrative committee as eligible for participation. The Plan was
adopted to offer to eligible employees whose participation in the 401(k) Plan
is limited an alternative means of receiving comparable benefits.
For each plan year, each active participant is eligible to contribute an amount
not to exceed the total of:
i) the amount by which the active participants 401(k) Plan contributions
have been limited by IRS regulations not to exceed the difference
between
a) six percent of the participant's compensation for the respective plan
year,
b) the total before and after tax contributions allocated under the
401(k) Plan, and
4
<PAGE>
1991 Thrift Incentive Stock Purchase Plan
for Employees of Cullen/Frost Bankers, Inc.
Notes to Financial Statements
December 31, 1995 and 1994
2. Description of the Plan (continued)
ii) the amount by which the participant's contributions to the 401(k) Plan
have been limited by IRS regulations.
For each plan year, the Company makes contributions equal to 100% of the
participants' before- and after-tax contributions to the Plan and the 401(k)
Plan, up to six percent of the participants' compensation for the respective
plan year.
Participants are immediately vested 100% in their accounts which are
distributed to them as of the date the distribution is made.
With respect to each plan year, all contributions under the Plan, both from the
participants and the Company, are invested in common stock of CFBI.
All assets of the Plan are distributed on an annual basis by the end of each
plan year. Participants receive stock certificates for their allocated portion
of CFBI common stock (in whole shares), and cash for fractional shares.
3. Transactions With Parties-In-Interest
The Company may pay for certain or all expenses incurred in administering the
provisions of the Plan. During 1995 and 1994, all such expenses were paid by
the Company.
4. Income Tax Status
The Plan is not subject to federal income taxes.
5
EXHIBIT 23.2
Consent of Independent Auditors with respect to Form 11-K
for the 1991 Thrift Incentive Stock Purchase Plan.
<PAGE>
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 33-30776) pertaining to the Cullen/Frost Bankers, Inc. 1983
Nonqualified Stock Option Plan, the Registration Statement (Form S-8 No.
33-30777) pertaining to the Cullen/Frost Bankers, Inc. 1988 Nonqualified Stock
Option Plan, the Registration Statement (Form S-8 No. 33-37500) pertaining to
the 401(k) Stock Purchase Plan for Employees of Cullen/Frost Bankers, Inc. and
its Affiliates, the Registration Statement (Form S-8 No. 33-39478) pertaining
to the 1991 Thrift Incentive Stock Purchase Plan for Employees of Cullen/Frost
Bankers, Inc. and its Affiliates, the Registration Statement (Form S-8 No.
33-53492) pertaining to the Cullen/Frost Bankers, Inc. Restricted Stock Plan,
and the Registration Statement (Form S-8 No. 33-53622) pertaining to the
Cullen/Frost Bankers, Inc. 1992 Stock Plan, of our report dated April 2, 1996,
with respect to the financial statements of the 1991 Thrift Incentive Stock
Purchase Plan for Employees of Cullen/Frost Bankers, Inc. included in this
Annual Report (Form 10-K/A) for the year ended December 31, 1995.
ERNST & YOUNG LLP
San Antonio, Texas
April 25, 1996
