SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
[ X ] Filed by the registrant
[ ] Filed by a 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 Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
CAPITAL SAVINGS BANCORP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
<PAGE>
[CAPITAL SAVINGS BANCORP, INC. LETTERHEAD]
September 23, 1997
Dear Fellow Stockholder:
On behalf of the Board of Directors and management of Capital Savings
Bancorp, Inc. (the "Company"), we cordially invite you to attend the Annual
Meeting of Stockholders of the Company. The meeting will be held at 9:00 a.m.
local time, on October 30, 1997, at the Capitol Plaza Hotel located at 415 W.
McCarty Street, Jefferson City, Missouri.
The attached Notice of Annual Meeting of Stockholders and Proxy
Statement discusses the business to be conducted at the meeting. We have also
enclosed a copy of the Company's Annual Report to Stockholders. At the meeting
we will report on the Company's operations and outlook for the year ahead.
You are invited to attend the meeting in person. Whether or not you
plan to attend, however, please read the enclosed Proxy Statement and then
complete, sign and date the enclosed proxy and return it in the accompanying
postage-paid return envelope provided as promptly as possible. This will save
the Company additional expense in soliciting proxies and will ensure that your
shares are represented at the meeting.
Your Board of Directors and management are committed to the continued
success of Capital Savings Bancorp, Inc. and the enhancement of your investment.
As Chairman of the Board, President and Chief Executive Officer, I want to
express my appreciation for your confidence and support.
Sincerely,
/s/LARRY V. SCHEPERS
--------------------
LARRY V. SCHEPERS
Chairman of the Board,
President and Chief Executive Officer
<PAGE>
CAPITAL SAVINGS BANCORP, INC.
425 Madison Street
Jefferson City, Missouri 65101
(573) 635-4151
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held on October 30, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of Capital Savings Bancorp, Inc. ("Capital Savings" or the "Company")
will be held at the Capitol Plaza Hotel located at 415 W. McCarty Street,
Jefferson City, Missouri on October 30, 1997 at 9:00 a.m. local time.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. The election of two directors of the Company;
2. The ratification of the appointment of Williams-Keepers as
auditors for the Company for the fiscal year ending June 30,
1998; and
such other matters as may properly come before the Meeting, or any adjournments
thereof. The Board of Directors is not aware of any other business to come
before the Meeting.
Any action may be taken on the foregoing proposals at the Meeting on
the date specified above, or on any date or dates to which the Meeting may be
adjourned. Stockholders of record at the close of business on September 5, 1997
are the stockholders entitled to vote at the Meeting and any adjournments
thereof. A complete list of stockholders entitled to vote at the Meeting will be
available for inspection by shareholders at the offices of the Company during
the ten day period prior to the Meeting as well as at the Meeting.
You are requested to complete and sign the enclosed form of proxy which
is solicited on behalf of the Board of Directors and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend and vote at the
Meeting in person.
By Order of the Board of Directors
/s/Larry V. Schepers
--------------------
Larry V. Schepers
Chairman of the Board, President and
Chief Executive Officer
Jefferson City, Missouri
September 23, 1997
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING. A PRE-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
WITHIN THE UNITED STATES.
<PAGE>
PROXY STATEMENT
CAPITAL SAVINGS BANCORP, INC.
425 Madison Street
Jefferson City, Missouri 65101
(573) 635-4151
ANNUAL MEETING OF STOCKHOLDERS
October 30, 1997
This Proxy Statement is furnished in connection with the solicitation
on behalf of the Board of Directors of Capital Savings Bancorp, Inc. ("Capital
Savings" or the "Company") of proxies to be used at the Annual Meeting of
Stockholders of the Company (the "Meeting") which will be held at the Capitol
Plaza Hotel located at 415 W. McCarty Street, Jefferson City, Missouri on
October 30, 1997 at 9:00 a.m. local time, and all adjournments of the Meeting.
The accompanying Notice of Meeting, proxy and this Proxy Statement are first
being mailed to stockholders on or about September 23, 1997. Certain information
provided herein relates to Capital Savings Bank, FSB (the "Bank"), a wholly
owned subsidiary of the Company.
At the Meeting, stockholders of the Company are being asked to consider
and vote upon the election of two directors of the Company and to ratify the
appointment of Williams-Keepers as the Company's auditors for the fiscal year
ending June 30, 1998.
Proxies and Proxy Solicitation
If a stockholder properly executes the enclosed proxy distributed by
the Company, the proxies named will vote the shares represented by that proxy at
the Meeting. Where a stockholder specifies a choice, the proxy will be voted in
accordance with the stockholder's instructions. Where no specific direction is
given, the proxies will vote the shares "FOR" the election of management's
nominees for directors of the Company and "FOR" the appointment of
Williams-Keepers as auditors for the fiscal year ending June 30, 1998. As to any
other matters presented at the Meeting, the shares for which proxies have been
received will be voted in accordance with the discretion of the proxies.
Any proxy given pursuant to this solicitation or otherwise may be
revoked by the stockholder giving it at any time before it is voted by
delivering to the Secretary of the Company at the above address, on or before
the taking of the vote at the Meeting, a written notice of revocation bearing a
later date than the proxy or a later dated proxy relating to the same shares of
common stock, par value $.01 per share, of the Company (the "Common Stock"), or
by attending the Meeting and voting in person. Attendance at the Meeting will
not in itself constitute the revocation of a proxy.
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. In addition to solicitation by mail,
directors, officers and employees of the Company and the Bank may solicit
proxies personally or by facsimile, telegraph or telephone, without additional
compensation.
<PAGE>
Voting Rights; Vote Required
Stockholders of record as of the close of business on September 5, 1997
(the "Voting Record Date"), will be entitled to one vote on each matter
presented for a vote at the Meeting for each share of Common Stock then held.
Such vote may be exercised in person or by a properly executed proxy as
discussed above. Directors shall be elected by a plurality of the shares present
in person or represented by proxy at the Meeting and entitled to vote on the
election of directors. Approval of the appointment of Williams-Keepers as
auditors for the year ending June 30, 1998 requires the affirmative vote of the
majority of shares present in person or represented by proxy at the Meeting and
entitled to vote on the matter.
With regard to the election of directors, votes may be cast in favor of
or withheld from each nominee; votes that are withheld will be excluded entirely
from the vote and will have no effect. Abstentions may be specified on all
proposals except the election of directors and will be counted as present for
purposes of the item on which the abstention is noted. Abstentions on the
proposal to ratify Williams-Keepers as the Company's auditors will have the
effect of a negative vote since that proposal requires the affirmative vote of a
majority of the shares present in person or by proxy and entitled to vote at the
Meeting. A broker non-vote (i.e., proxies from brokers or nominees indicating
that such persons have not received instructions from the beneficial owners or
other persons as to certain proposals on which such beneficial owners or persons
are entitled to vote their shares but with respect to which the brokers or
nominees have no discretionary power to vote without such instructions) will
have no effect on the outcome of the election of directors or ratification of
auditors. Brokers who do not receive instructions are entitled to vote on the
election of directors and the ratification of the Company's auditors.
<PAGE>
Voting Securities and Principal Holders Thereof
As of the Voting Record Date, the Company had 1,891,800 shares of
Common Stock issued and outstanding. The following table sets forth information
regarding share ownership of: (i) those persons or entities known by management
to beneficially own more than five percent of the Company's Common Stock and
(ii) all directors and officers as a group. See "Proposal I -Election of
Directors" for information regarding share ownership of the Company's Chief
Executive Officer and its Directors.
<TABLE>
<CAPTION>
Shares Beneficially Percent of
Beneficial Owners Owned Class
----------------- ----- -----
<S> <C> <C>
Capital Savings Bancorp, Inc.(1) 191,680 10.13%
Employee Stock Ownership Plan
425 Madison Street
Jefferson City, Missouri 65101
Investors of America, Limited Partnership(2) 234,596 12.40%
135 North Meramec
Clayton, Missouri 63124
Mr. Larry V. Schepers(3) 132,014 6.73%
Capital Savings Bancorp, Inc.
425 Madison Street
Jefferson City, Missouri 65101
Directors and executive officers 364,933 17.76%
of Capital Savings and the Bank
as a group (8 persons)(4)
- -------------------------
(1) The amount reported represents shares held by the Employee Stock
Ownership Plan ("ESOP"), 101,070 shares of which were allocated to, or
purchased on behalf of, the accounts of participants. First Bankers
Trust Company, N.A., of Quincy, Illinois, as the trustee of the ESOP,
may be deemed to beneficially own the shares held by the ESOP which
have not been allocated to the accounts of participants. Pursuant to
the terms of the ESOP, participants in the ESOP have the right to
direct the voting of shares allocated to, or purchased on behalf of,
their accounts.
(2) As reported by First Securities America, Inc. ("FSAI"), the general
partner of Investors of America, Limited Partnership ("Investors"), on
Form 3 filed with the Securities and Exchange Commission (the "SEC")
during June 1996. FSAI disclaims beneficial ownership of the Common
Stock owned by Investors, except to the extent of FSAI's pecuniary
interest in Investor. On June 18, 1996, Dierberg Four, L.P. ("DFLP"),
the previous record owners of the Common Stock, merged with and into
Investors. DFLP, pursuant to Amendment No. 1 to its Schedule 13D dated
May 12, 1994 and filed with the SEC, had reported sole voting and
investment power with respect to all shares of Common Stock reported
thereunder.
<PAGE>
(3) Mr. Schepers reported sole voting and investment power with respect to
119,312 shares of Common stock and shared power with respect to 12,702
shares of Common Stock reported as beneficially owned by him. Included
in the shares reported as beneficially owned by Mr. Schepers are
options to purchase 70,193 shares of Common Stock.
(4) Includes shares held directly, as well as, jointly with family members
or held by trusts, with respect to which shares the listed individuals
or group members may be deemed to have sole or shared voting and
investment power. Included in the shares reported as beneficially owned
by all directors and executive officers are options to purchase 162,666
shares of Common Stock.
</TABLE>
PROPOSAL I - ELECTION OF DIRECTORS
General
The Company's Board of Directors is currently composed of six members,
each of whom is also a director of the Bank. Directors are generally elected to
serve for three-year terms or until their respective successors are elected and
qualified.
<PAGE>
The table below sets forth, as of the Voting Record Date, certain
information regarding the composition of the Company's Board of Directors,
including each director's term of office. The Board of Directors acting as the
nominating committee has recommended and approved the nominees identified in the
following table. It is intended that the proxies solicited on behalf of the
Board of Directors (other than proxies in which the vote is withheld as to a
nominee) will be voted at the Meeting "For" the election of the nominees. If a
nominee is unable to serve, the shares represented by all valid proxies will be
voted for the election of such substitute nominee as the Board of Directors may
recommend. At this time, the Board of Directors knows of no reason why any
nominee might be unable to serve if elected. Except as disclosed herein, there
are no arrangements or understandings between any director or nominee and any
other person pursuant to which a nominee was selected.
<TABLE>
<CAPTION>
Shares of
Term Common Stock Percent
Position(s) Held Director to Beneficially of
Name Age(1) in the Company Since(2) Expire Owned(3) Class
---- ------ -------------- -------- ------ -------- -----
<S> <C> <C> <C> <C> <C> <C>
NOMINEE
Joseph E. Forck 64 Director and Senior Vice President 1984 2000 31,723(4) 1.67%
Larry V. 52 Chairman of the Board, President 1988 2000 132,014(5) 6.73%
Schepers and Chief Executive Officer
DIRECTORS REMAINING IN OFFICE
Frank A. Sloan 65 Director 1984 1999 35,352 1.86%
Arthur F. Wankum 63 Director, Executive Vice President 1973 1999 64,322(6) 3.30%
and Chief Financial Officer
Ralph J. Kalberloh 71 Director 1984 1998 32,737 1.72%
Wayne R. Walquist 74 Director 1971 1998 30,352(7) 1.59%
- -------------------
(1) At June 30, 1997.
(2) Includes service as a director of the Bank.
(3) The nature of beneficial ownership for shares reported in this column
is sole voting and investment power, except as otherwise noted in these
footnotes. Included in the shares beneficially owned by the named
individuals are options to purchase shares of Common Stock as follows:
Mr. Forck - 12,564 shares; Mr. Schepers - 70,193 shares; Mr. Sloan -
12,564 shares; Mr. Wankum - 24,294 shares; Mr. Kalberloh - 12,564
shares; and Mr. Walquist - 12,564 shares. All shares reported as
beneficially owned have been adjusted for the two for one stock split
paid in the form of a 100% stock dividend by the Company on November
22, 1996.
<PAGE>
(4) Includes 2,046 shares as to which Mr. Forck has reported shared
ownership.
(5) Includes 12,702 shares as to which Mr. Schepers has reported shared
ownership.
(6) Includes 6,526 shares as to which Mr. Wankum has reported shared
ownership.
(7) Includes 14,224 shares as to which Mr. Walquist has reported shared
ownership.
</TABLE>
The principal occupation of each director of the Company is set forth
below. All directors have held their present position for at least five years
unless otherwise indicated.
Joseph E. Forck - Mr. Forck joined Capital Savings in 1962. He has
served as Senior Vice President Lending since 1978 and was elected to the Board
in 1983. He serves as Secretary and as a Director of CSFS. Mr. Forck is active
in various civic organizations, including the Jefferson City Chamber of Commerce
and Missouri Home Builders Association.
Larry V. Schepers - Mr. Schepers has served as Chairman of the Board,
President and Chief Executive Officer of the Company since its incorporation in
1993 and of the Bank since 1989. He also serves as President and as a Director
of Capital Savings Financial Services, Inc. ("CSFC"), a wholly-owned subsidiary
of the Bank. Mr. Schepers has served in various capacities since beginning his
career with the Bank in 1984. He is a Director of the Federal Home Loan Bank of
Des Moines, Past Chairman and current Board member and Legislative Committee
Chairman of the Missouri League of Savings Institutions, past Board member and
Committee Chairman for the Jefferson City Chamber of Commerce, active in the
United Way of Central Missouri, a member of the Jefferson City Rotary Club, past
President of the Helias School Board and a Board member of the Lincoln
University Foundation. Mr. Schepers received his B.S. Degree in Business
Administration from Lincoln University in 1966.
Frank A. Sloan - Mr. Sloan is a self-employed insurance agent in
Jefferson City, Missouri. He is an active emeritus agent with Bankers Life and
Casualty and has been continuously associated with that Company since 1953. He
is a current member and former board member of the Central Missouri Chapter of
Chartered Life Underwriters. Mr. Sloan received his degree in Business
Administration from Northeast Missouri State University in Kirksville, Missouri.
Arthur F. Wankum - Mr. Wankum has been a Director, Executive Vice
President and Chief Financial Officer of the Company since its incorporation and
of the Bank since 1973. Mr. Wankum joined the Bank in 1959. He also serves as a
Director and Vice President of CSFS. Mr. Wankum is a former Legislative
Committee Vice Chairman of the Missouri League of Savings Institutions, former
Board member of the Jefferson City Chamber of Commerce, current member and past
President of the Jefferson City Cosmopolitan Club, and past Board member and
Committee Chairman of the Capital Regional Medical Center. Mr. Wankum received
his B.S. degree in Education from Lincoln University
<PAGE>
Ralph J. Kalberloh - Mr. Kalberloh joined Northwood University located
in Midland, Michigan, in 1992 as a consultant. He retired in 1992 as Executive
Vice President of the Missouri Automobile Dealer's Association. He is a former
President of Memorial Community Hospital, of the Jefferson City Chamber of
Commerce, the Rotary Club and of the Jefferson City and Richmond (Missouri)
Jaycees, and former Chairman of the United Way. In 1997, Mr. Kalberloh was
inducted into the U.S. Jaycees "Hall of Leadership." He is also a former
President of the Missouri Society of Association Executives and in 1992 was
selected to receive their first "Distinguished Service Award." In addition, Mr.
Kalberloh is a former Chairman of the Board of Regents for the Notre Dame
Institute of Organization Management, former Director and Vice President of the
American Society of Association Executives, and past President of the Automotive
Trade Association Executives of the U.S. and Canada. Mr. Kalberloh is also a
Director of Union Investors Life Insurance Company of Columbia, Missouri and an
Advisory Director to Mid-America Alliance Corp. in Jefferson City, Missouri. He
attended Lincoln University and is a graduate of the Academy of Organization
Management.
Wayne R. Walquist - Mr. Walquist is the Chairman of the Board,
President and founder of the Family Benefit Life Insurance company located in
Jefferson City, Missouri. He founded the company in 1964. In addition, Mr.
Walquist is the President and a Director of the Missouri Insurance Associates,
Inc., a property casualty agency and a wholly owned subsidiary of the Family
Benefit Life Insurance Company. He is a member of the Board for Cameron
Companies and a lifetime member of the Board of Governors for Memorial Community
Hospital.
Meetings and Committees of the Boards of Directors
Meetings and Committees of the Company. Meetings of the Company's Board
of Directors are generally held on a monthly basis. The Board of Directors met
12 times during fiscal 1997. During fiscal 1997, no incumbent director of the
Company attended fewer than 75% of the aggregate of the total number of Board
meetings and the total number of meetings held by the committees of the Board of
Directors on which they served.
The Board of Directors of the Company has standing Audit, Stock Option
and Personnel Committees.
The Company's Audit Committee recommends independent auditors to the
full Board, reviews the results of the auditors' services, reviews with
management and the internal auditor the systems of internal control and internal
audit reports, and assures that the books and records of the Company and the
Bank are kept in accordance with applicable accounting principles and standards.
The members of the Audit Committee are Directors Kalberloh, Sloan and Walquist.
This committee met four times during fiscal 1997.
The Stock Option Committee is composed of Directors Kalberloh, Sloan
and Walquist. This committee is responsible for administering the Company's 1994
Stock Option and Incentive Plan (the "Stock Option Plan") and reviews
compensation and benefit matters. This committee met once during fiscal 1997.
The Personnel Committee consisting of Directors Kalberloh, Sloan and
Walquist is responsible for administering the Company's Recognition and
Retention Plan (the "RRP"). This committee met once during fiscal 1997.
<PAGE>
The entire Board of Directors acts as a nominating committee for
selecting nominees for election as directors. Nominations of persons for
election to the Board of Directors may be made only by or at the direction of
the Board of Directors or by any stockholder entitled to vote for the election
of directors who complies with the notice procedures set forth in the Bylaws of
the Company. Pursuant to the Company's Bylaws, nominations by stockholders must
be delivered in writing to the Secretary of the Company at least 30 days prior
to the date of the annual meeting.
Meetings and Committees of the Bank. The Bank's Board of Directors
meets monthly and may have additional special meetings upon the written request
of the Chairman of the Board or at least three directors. The Board of Directors
met 12 times during fiscal 1997. During fiscal 1997, no incumbent director of
the Bank attended fewer than 75% of the aggregate of the total number of Board
meetings and the total number of meetings held by the committees of the Board of
Directors on which he served. The Bank has standing Senior Management,
Asset/Liability, Audit, Senior Management Compensation as well as other
committees which meet periodically. Set forth below is a description of certain
committees of the Bank.
The Bank's Senior Management Committee is responsible for the review
and recommendation of action regarding all aspects of the Banks operational
activities. This Committee is comprised of Directors Schepers, Wankum and Forck,
Senior Vice President Clark and Vice President Britt. The Senior Management
Committee met eight times in fiscal 1997.
The Bank's Asset/Liability Committee is responsible for the Bank's
interest rate risk management activities. This Committee is comprised of
Directors Schepers, Wankum and Forck, Senior Vice President Clark, Vice
President Britt, Compliance Officer Dave Meyer and Savings Manager Arlene Vogel.
The Asset/Liability Committee met eight times in fiscal 1997.
All of the outside directors of the Bank constitute the Bank's Audit
Committee, which selects the Bank's independent accountants and meets with these
accountants to discuss the scope and results of the annual audit. This committee
met four times during fiscal 1997.
The Bank's Senior Management Compensation Committee is responsible for
the review of senior managements' job performance on an annual basis. Directors
Kalberloh, Sloan and Walquist serve on this Committee, which met once in fiscal
1997. President Schepers also serves on this committee in an advisory capacity.
Director Compensation
Directors of the Company were not paid a fee for service on the Board
of Directors or any committee of the Company during fiscal 1997. However,
directors of the Bank received a fee of $12,000 for service on the Bank's Board
of Directors during fiscal 1997. The Bank does not pay directors a fee for
service on any committees.
In addition, directors (except for Mr. Schepers) were granted options
to purchase 2,500 shares of Common Stock during fiscal 1997. These options were
granted at an exercise price of $13.44 per share, the "Market Value" (as defined
in the Stock Option Plan) of the Common Stock on the date of the grant. See
"Executive Compensation" below for information on option awards granted to Mr.
Schepers during fiscal 1997.
<PAGE>
Executive Compensation
The Company has not paid any compensation to its executive officers
since its formation nor does the Company presently anticipate paying any
compensation to such persons. The following table sets forth information
regarding the compensation paid by the Bank to its Chief Executive Officer. No
other officer earned in excess of $100,000 during fiscal 1997.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation Awards
-------------------------------- -----------------------
Restricted Securities
Other Annual Stock Underlying All Other
Salary Bonus Compensation Award Options Compensation
Name and Principal Position Year ($)(1) ($) ($)(2) ($) (#) ($)
--------------------------- ---- ------ --- ------ --- --- ---
<S> <C> <C> <C> <C> <C> <C> <C>
Larry V. Schepers, Chairman, 1997 $142,000 $10,400 --- $26,880(3) 10,000(4) $13,185(5)
President and Chief Executive
Officer 1996 129,200 400 --- --- --- 14,635
1995 117,200 --- --- --- --- 14,901
(1) Includes directors fees of $12,000 for fiscal 1997 and $7,200 for
fiscal 1996 and 1995.
(2) Mr. Schepers did not receive any additional benefits or perquisites
which exceeded, in the aggregate, the lesser of 10% of his salary and
bonus, or $50,000.
(3) Represents the dollar value of 2,000 shares of restricted Common Stock
granted to Mr. Schepers (based on the $13.44 per share "Market Value"
(as defined in the RRP) as of the date of the grant). The shares of
restricted stock vest in five equal annual installments commencing on
January 1, 1998, provided the individual maintains "Continuous Service"
(as defined in RRP) with the Company and/or the Bank. All dividends
declared and paid on the restricted shares are paid directly to Mr.
Schepers. Based on $16.94, the average of the closing bid and asked
prices per share of Common Stock on June 30, 1997, the 2,000 restricted
shares held by Mr. Schepers had an aggregate market value of $33,880.
(4) On December 19, 1996, Mr. Schepers received an option to purchase
10,000 shares of Common Stock at an exercise price of $13.44 per share,
the "Market Value (as defined in the Stock Option Plan) of the Common
Stock on the date of the grant. The option vests in three equal
installments on July 1, 1997, January 1, 1998 and July 1, 1998.
(5) Includes a $12,045 contribution under the ESOP and $1,140 of life
insurance premiums paid by the Company on behalf of Mr. Schepers.
</TABLE>
<PAGE>
The following table sets forth certain information concerning grants of
stock options pursuant to the Company's Stock Option Plan to the named officers
during the fiscal year ended June 30, 1997. No stock appreciation rights or
limited stock appreciation rights have been granted to date.
<TABLE>
<CAPTION>
OPTION GRANTS IN LAST FISCAL YEAR
Individual Grants(1)
% of Total
Number of Securities Options Granted to Exercise or
Underlying Options Employees Base Price Expiration
Name Granted (#) in Fiscal Year(2) ($/Sh) Date
---- ----------- ----------------- ------ ----
<S> <C> <C> <C> <C>
Larry V. Schepers 10,000 25.1% $13.44 12/19/06
(1) These options vest in three equal installments on the following dates:
July 1, 1997, January 1, 1998 and July 1, 1998.
(2) Represents the percentage of options granted to employees of the
Company during fiscal 1997; it does not include option grants to
non-employee directors during the fiscal year.
</TABLE>
The following table provides information as to stock options exercised
and the value of the options held by the Company's Chief Executive Officer at
June 30, 1997. To date, no stock appreciation rights have been granted by the
Company.
<TABLE>
<CAPTION>
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
FY-End (#) FY-End ($)(1)
-------------------------- ---------------------------
Shares Value
Acquired on Realized Exercisable Unexercisable Exercisable Unexercisable
Name Exercise (#) ($) (#) (#) ($) ($)
---- ------------ --- --- --- --- ---
<S> <C> <C> <C> <C> <C> <C>
Larry V. Schepers --- --- 66,860 10,000 $798,308 $35,000
(1) Represents the aggregate market value (market price of the Common Stock
less the exercise price) of the option granted. At June 30, 1997, the
market price of the Company's Common Stock, based upon the average of
the closing bid and the asked prices as reported on The Nasdaq Stock
Market, was $16.94 per share.
</TABLE>
<PAGE>
Employment Agreement
In connection with the Bank's mutual to stock conversion, the Bank
entered into an employment agreement with President and Chief Executive Officer
Schepers. The employment agreement is designed to assist the Bank and the
Company in maintaining a stable and competent management base. The continued
success of the Bank and the Company depends to a significant degree on the
skills and competence of their officers. The employment agreement provides for
an annual base salary in an amount not less than Mr. Schepers' current salary
and an initial term of three years. Subject to annual performance review and
approval by the Board, the term of such employment agreement is extended
annually by one year, in addition to the then-remaining term under the
agreement. For the year ended June 30, 1997, the Bank's Board of Directors
reviewed and approved the extension of Mr. Schepers' employment agreement for an
additional year.
The agreement provides for termination upon the employee's death, for
cause or in certain events specified by Office of Thrift Supervision
regulations. The employment agreement is also terminable by the employee upon
180 days notice to the Bank.
Furthermore, the employment agreement provides for payment to Mr.
Schepers of his salary for the remainder of the term of the agreement, plus up
to 299% of his base compensation, in the event there is a "change in control" of
the Bank where employment terminates involuntarily in connection with such
change in control or within twelve months thereafter. This termination payment
is subject to reduction by the amount of all other compensation to the employee
deemed for purposes of the Internal Revenue Code of 1986, as amended ("Code") to
be contingent on a change in control, and may not exceed three times Mr.
Schepers' average annual compensation over the most recent five year period or
be non-deductible by the Bank for federal income tax purposes. For the purposes
of the employment agreement, a change in control is defined as any event which
would require the filing of an application for acquisition of control or notice
of change in control pursuant to 12 C.F.R. ss. 574.3 or 4. Such events are
generally triggered prior to the acquisition or control of 10% of the Company's
common stock. The agreement guarantees participation in an equitable manner in
employee benefits applicable to executive personnel.
Based on his current salary, if Mr. Schepers' employment had been
terminated as of June 30, 1997 under circumstances entitling him to benefits pay
as described above, he would have been entitled to receive a lump sum cash
payment of approximately $391,000.
Executive Salary Continuation Agreement
On November 1, 1994, the Bank entered into an Executive Salary
Continuation Agreement ("ESCA") with Mr. Schepers. The ESCA is an unfunded,
non-qualified agreement which provides, in general, for a $50,000 annual benefit
to be paid by the Bank for a period of 15-years to Mr. Schepers upon retirement
at age 60 or older ("Retirement Age"). In the event of the death of Mr.
Schepers, whether before or after Retirement Age, the Bank will make such
benefit payments to his designated beneficiary. Furthermore, the ESCA provides
that Mr. Schepers will receive his full annual benefit in the event his
employment is involuntarily terminated following a change of control (as defined
in the ESCA) of the Bank or the Company prior to his reaching age 60. The annual
benefit payable to Mr. Schepers is subject to adjustment to reflect changes in
<PAGE>
the consumer price index, up to a maximum of three percent per year beginning on
the first anniversary of the first benefit payment. In the event Mr. Schepers
becomes disabled (as defined in the ESCA) at any time prior to attaining the age
of 60 while actively employed by the Bank, Mr. Schepers will receive a lump sum
payment of $423,000, which payment will be in lieu of any other retirement or
death benefit payable to Mr. Schepers under the ESCA.
Termination of Mr. Schepers' employment prior to his attaining age 60,
other than by death, disability, or involuntary termination, will entitle Mr.
Schepers to an amount determined in accordance with the vesting schedule set
forth in the ESCA. In the event Mr. Schepers' employment was terminated, as
described in the preceding sentence, as of June 30, 1997, he would have been
entitled to receive approximately $58,600 pursuant to the ESCA.
Certain Transactions
The Bank has followed a policy of granting loans to eligible directors,
officers, employees and members of their immediate families for the financing of
their personal residences and for consumer purposes. All outstanding loans have
been made in the ordinary course of business and on the same terms, including
collateral and interest rates, as those prevailing at the time for comparable
transactions and did not involve more than the normal risk of collectibility. At
June 30, 1997, the Bank had no such outstanding preferential loans to
affiliates.
PROPOSAL II - RATIFICATION OF THE APPOINTMENT OF AUDITORS
The Board of Directors has renewed the Company's arrangement for
Williams-Keepers to be its auditors for the 1998 fiscal year, subject to the
ratification of the appointment by the Company's stockholders. A representative
of Williams-Keepers is expected to attend the Annual Meeting to respond to
appropriate questions and will have an opportunity to make a statement if he or
she so desires.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF WILLIAMS-KEEPERS AS THE COMPANY'S AUDITORS
FOR THE FISCAL YEAR ENDING JUNE 30, 1998.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials
for the next Annual Meeting of Stockholders, any stockholder proposal to take
action at such meeting must be received at the Company's main office, 425
Madison Street, Jefferson City, Missouri no later than May 26, 1998. Any such
proposal shall be subject to the requirements of the proxy rules adopted under
the Exchange Act.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matter should properly come before the Meeting, it is
intended that holders of the proxies will act in accordance with their best
judgment.
<PAGE>
REVOCABLE PROXY
CAPITAL SAVINGS BANCORP, INC.
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
ANNUAL MEETING OF STOCKHOLDERS o October 30, 1997
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints the Board of Directors of Capital Savings
Bancorp, Inc. (the "Company"), and its survivor, with full power of
substitution, to act as attorneys and proxies for the undersigned to vote all
shares of common stock of the Company which the undersigned is entitled to vote
at the Annual Meeting of Stockholders (the "Meeting"), to be held on October 30,
1997 at the Capitol Plaza Hotel located at 415 W. McCarty Street, Jefferson
City, Missouri, at 9:00 A.M. local time, and at any and all adjournments
thereof, as follows:
I. The election of Larry V. Schepers and Joseph E. Forck as directors for a term
to expire in the year 2000.
[ ] FOR [ ] WITHHOLD [ ] EXCEPT
INSTRUCTION: To vote for all nominees mark the box "For" with an "X". To
withhold your vote for an individual nominee mark the box "Except" with an "X"
and write the name of the nominee on the line provided below for whom you wish
your vote withheld. To withhold your vote as to all nominees mark the box
"Withhold" with an "X".
- --------------------------------------------------------------------------------
II. The ratification of the appointment of Williams-Keepers as independent
auditors for the Corporation for the fiscal year ending June 30, 1998.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
In their discretion, the proxies are authorized to vote on any other business
that may properly come before the Meeting or any adjournment thereof.
The Board of Directors recommends a vote "FOR" the listed proposals.
The undersigned acknowledges receipt from the Company, prior to the execution
of this Proxy, of a Notice of the Annual Meeting, a Proxy Statement dated
September 23, 1997 and the Company's Annual Report to Stockholders for the
fiscal year ended June 30, 1997.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
PROXY WILL BE VOTED FOR THE PROPOSALS STATED. IF ANY OTHER BUSINESS IS PRESENTED
AT SUCHMEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY IN THEIR
BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER
BUSINESS TO BE PRESENTED AT THE MEETING.
<PAGE>
Please be sure to sign and date this Proxy in the box below.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
CAPITAL SAVINGS BANCORP, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
This proxy may be revoked at any time before it is voted by delivering to the
Secretary of the Company, on or before the taking of the vote at the Meeting, a
written notice of revocation bearing a later date than the proxy or a later
dated proxy relating to the same shares of Company common stock, or by attending
the Meeting and voting in person. Attendance at the Meeting will not in itself
constitute the revocation of a proxy. If this proxy is properly revoked as
described above, then the power of such attorneys and proxies shall be deemed
terminated and of no further force and effect.
Please sign exactly as your name appears on this proxy card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder should sign.
PLEASE PROMPTLY COMPLETE, DATE, SIGN AND MAIL THIS PROXY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE
