<PAGE> 1
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
CENTRAL COAST BANCORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee.
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(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:
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE> 2
CENTRAL COAST BANCORP
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
THURSDAY, MAY 22, 1997
TO THE SHAREHOLDERS:
The Annual Meeting of Shareholders of Central Coast Bancorp will be
held at 301 Main Street, Salinas, California, on Thursday, May 22, 1997 at
5:30 p.m. for the following purposes:
1. To elect directors.
2. To approve the appointment of Deloitte & Touche LLP as
independent public accountants for the 1997 fiscal year.
3. To transact such other business as may properly come before
the Meeting.
The names of the Board of Directors' nominees to be directors of
Central Coast Bancorp are set forth in the accompanying Proxy Statement and
incorporated herein by reference.
Article III, Section 16 of the Bylaws of Central Coast Bancorp provides
for the nomination of directors in the following manner:
"Nomination for election of members of the Board of Directors may be
made by the Board of Directors or by any shareholder of any outstanding
class of capital stock of the corporation entitled to vote for the election
of directors. Notice of intention to make any nominations shall be made in
writing and shall be delivered or mailed to the President of the
corporation not less than 21 days nor more than 60 days prior to any
meeting of shareholders called for the election of directors; provided
however, that if less than 21 days notice of the meeting is given to
shareholders, such notice of intention to nominate shall be mailed or
delivered to the President of the corporation not later than the close of
business on the tenth day following the day on which the notice of meeting
was mailed; provided further that if notice of such meeting is sent by
third-class mail as permitted by Section 6 of these By-Laws, no notice of
intention to make nominations shall be required. Such notification shall
contain the following information to the extent known to the notifying
shareholder:
(a) the name and address of each proposed nominee;
(b) the principal occupation of each proposed nominee;
(c) the number of shares of capital stock of the corporation owned
by each proposed nominee;
(d) the name and residence address of the notifying shareholder;
and
(e) the number of shares of capital stock of the corporation owned
by the notifying shareholder.
<PAGE> 3
Nominations not made in accordance herewith may, in the discretion of the
Chairman of the meeting, be disregarded and upon the Chairman's instructions,
the inspectors of election can disregard all votes cast for each such nominee.
A copy of this paragraph shall be set forth in a notice to shareholders of any
meeting at which Directors are to be elected."
Only shareholders of record at the close of business on April 23, 1997
are entitled to notice of and to vote at this Meeting and at any postponements
or adjournments thereof.
BY ORDER OF THE BOARD OF DIRECTORS
Salinas, California
April 28, 1997 By: /s/ THOMAS A SA
--------------------
Thomas A. Sa
Secretary
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASE SIGN AND RETURN THE
ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
<PAGE> 4
Mailed to Shareholders
on or about April 28, 1997
CENTRAL COAST BANCORP
PROXY STATEMENT
INFORMATION CONCERNING THE SOLICITATION
This Proxy Statement is being furnished to the shareholders of Central
Coast Bancorp, a California corporation (the "Corporation"), in connection with
the solicitation of proxies by the Board of Directors for use at the Annual
Meeting of Shareholders to be held at 301 Main Street, Salinas, California on
May 22, 1997 at 5:30 p.m. (the "Meeting"). Only shareholders of record on April
23, 1997 (the "Record Date") will be entitled to notice of the Meeting and to
vote at the Meeting. At the close of business on the Record Date, the
Corporation had outstanding and entitled to be voted 4,298,584 shares of its no
par value Common Stock (the "Common Stock").
Shareholders are entitled to one vote for each share held, except that
for the election of directors each shareholder has cumulative voting rights and
is entitled to as many votes as shall equal the number of shares held by such
shareholder multiplied by the number of directors to be elected. Each
shareholder may cast all his or her votes for a single candidate or distribute
such votes among any or all of the candidates as he or she chooses. However, no
shareholder shall be entitled to cumulate votes (in other words, cast for any
candidate a number of votes greater than the number of shares of stock held by
such shareholder) unless such candidate's name has been placed in nomination
prior to the voting and the shareholder has given notice at the Meeting prior to
the voting of the shareholder's intention to cumulate his or her votes. If any
shareholder has given such notice, all shareholders may cumulate their votes for
candidates in nomination. Prior to voting, an opportunity will be given for
shareholders or their proxies at the Meeting to announce their intention to
cumulate their votes. The proxy holders are given, under the terms of the proxy,
discretionary authority to cumulate votes on shares for which they hold a proxy.
Any person giving a proxy in the form accompanying this Proxy Statement
has the power to revoke that proxy prior to its exercise. The proxy may be
revoked prior to the Meeting by delivering to the Secretary of the Corporation
either a written instrument revoking the proxy or a duly executed proxy bearing
a later date. The proxy may also be revoked by the shareholder by attending and
voting at the Meeting.
Votes cast by proxy or in person at the Meeting will be counted by the
Inspectors of Election for the Meeting. The Inspectors will treat abstentions
and "broker non-votes" (shares held by brokers or nominees as to which
instructions have not been received from the beneficial owners or persons
entitled to vote and the broker or nominee does not have discretionary voting
power under applicable rules of the stock exchange or other self regulatory
organization of which the broker or nominee is a member) as shares that are
present and entitled to vote for purposes of determining the presence of a
quorum. Abstentions and "broker non-votes" will not be counted as shares voted
for purposes of determining the outcome of any matter as may properly come
before the Meeting.
<PAGE> 5
Unless otherwise instructed, each valid proxy returned which is not
revoked will be voted in the election of directors "FOR" the nominees of the
Board of Directors and "FOR" proposal No. 2 as described in this Proxy
Statement, and, at the proxy holders' discretion, on such other matters, if any,
which may come before the Meeting (including any proposal to postpone or adjourn
the Meeting).
The Corporation will bear the entire cost of preparing, assembling,
printing and mailing proxy materials furnished by the Board of Directors to
shareholders. Copies of proxy materials will be furnished to brokerage houses,
fiduciaries and custodians to be forwarded to the beneficial owners of the
Common Stock. In addition to the solicitation of proxies by use of the mail,
some of the officers, directors and regular employees of the Corporation and its
subsidiaries, Bank of Salinas and Cypress Bank (the "Subsidiaries"), may
(without additional compensation) solicit proxies by telephone or personal
interview, the costs of which will be borne by the Corporation.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of the Record Date, April 23, 1997, no individual known to the Corporation
owned more than five percent (5%) of the outstanding shares of its Common Stock
except as described below.
<TABLE>
<CAPTION>
Percentage
Name and Address Amount and Nature of Class
Title of of Beneficial of Beneficial Beneficially
Class Owner(1) Ownership Owned (3)
=====================================================================================================================
<S> <C> <C> <C>
Common Stock, Estate of Adele O'Grady 239,352 5.09%
No Par Value
============================ ================================== ======================== ========================
Common Stock, Robert L. Meyer (2) 314,603 6.69%
No Par Value
============================ ================================== ======================== ========================
</TABLE>
(1) The address for all persons listed is c/o Central Coast Bancorp, 301
Main Street, Salinas, California, 93901.
(2) All shares are held by Mr. Meyer and his spouse as trustees of the
Robert L. Meyer and Patricia J. Meyer Trust dated July 28, 1977.
(3) Includes shares of Common Stock subject to stock options exercisable
immediately.
2
<PAGE> 6
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information as of April 23, 1997, concerning
the equity ownership of the Corporation's directors and the executive officers
named in the Summary Compensation Table, and directors and executive officers as
a group. Unless otherwise indicated in the notes to the table, each director and
executive officer listed below possesses sole voting power and sole investment
power for the shares of the Corporation's Common Stock listed below. All of the
shares shown in the following table are owned both of record and beneficially
except as indicated in the notes to the table. The Corporation has only one
class of shares outstanding, Common Stock.
<TABLE>
<CAPTION>
Name and Address(1) of Amount and Nature of Percent of
Title of Class Beneficial Owner Beneficial Ownership Class(2)
- -------------- ---------------- -------------------- --------
<S> <C> <C> <C>
Common Stock,
No Par Value Andrew E. Ausonio 126,909 (3) 2.70%
Common Stock,
No Par Value Robert C. Blatter 6,005 (4) --
Common Stock,
No Par Value C. Edward Boutonnet 136,128 (5) 2.90%
Common Stock,
No Par Value Bradford G. Crandall 97,735 (6) 2.08%
Common Stock,
No Par Value Alfred P. Glover 12,267 --
Common Stock,
No Par Value Richard C. Green 137,255 (7) 2.92%
Common Stock,
No Par Value Duncan L. McCarter 78,409 (8) 1.67%
Common Stock,
No Par Value John F. McCarthy 37,791 (9) --
Common Stock,
No Par Value Robert M.
Mraule, D.D.S., M.D. 90,531 (10) 1.93%
Common Stock,
No Par Value C. Frederick Rowden 17,817 (11) --
Common Stock,
No Par Value Thomas A. Sa 1,650 (12) --
Common Stock,
No Par Value Louis A. Souza 13,716 --
Common Stock,
No Par Value Mose E. Thomas, Jr. 16,392 --
Common Stock,
No Par Value Nick Ventimiglia 35,140 (13) --
All directors and executive officers
of the Corporation
as a group (15 persons) 720,404 (14) 15.33%
</TABLE>
3
<PAGE> 7
(1) The address for all persons listed is c/o Central Coast Bancorp,
301 Main Street, Salinas, California, 93901.
(2) Includes shares of Common Stock subject to stock options exercisable
immediately. Unless otherwise indicated, beneficial ownership
represents less than one percent of the total class of shares
outstanding.
(3) Includes 55,083 shares of Common Stock held by Mr. Ausonio and his
spouse as trustees of the Ausonio Family Trust dated October 4, 1982,
25,224 shares of Common Stock held by Mr. Ausonio and his spouse as
trustees of the Barsotti Grandchildren Trust dated December 20, 1976,
and 46,602 shares of Common Stock subject to stock options exercisable
immediately.
(4) Includes 5,590 shares of Common Stock subject to stock options
exercisable immediately.
(5) Includes 47,887 shares of Common Stock owned jointly with Patricia
Boutonnet, 1,294 shares as custodian, 6,057 shares of Common Stock held
by Mr. Boutonnet as trustee of Boutonnet Farms Money Purchase Trust
dated October 26, 1982, 1,870 shares held by Mr. Boutonnet as trustee
of Boutonnet Farms Money Purchase Pension Plan and Trust dated November
1, 1980, 19,038 shares of Common Stock held by Mr. Boutonnet as trustee
of Boutonnet Farms, Inc. Money Purchase Pension Trust dated November 1,
1976 and 46,602 shares of Common Stock subject to stock options
exercisable immediately.
(6) Includes 51,133 shares of Common Stock held by Mr. Crandall and his
spouse as trustees of the Bradford G. Crandall and Lynne O. Crandall
Trust dated August 8, 1983 and 46,602 shares of Common Stock subject to
stock options exercisable immediately.
(7) Includes 591 shares of Common Stock owned by Mr. Green's spouse and
46,602 shares of Common Stock subject to stock options exercisable
immediately.
(8) Includes 29,888 shares of Common Stock held by Mr. McCarter and his
spouse as trustees of the Duncan L. McCarter and Leslie P. McCarter
Trust dated January 25, 1990, and 46,602 shares of Common Stock subject
to stock options exercisable immediately.
(9) Includes 2,079 shares of Common Stock owned jointly with Mr. McCarthy's
spouse and 35,712 shares of Common Stock subject to stock options
exercisable immediately.
(10) Includes 46,602 shares of Common Stock subject to stock options
exercisable immediately.
(11) Includes 17,106 shares of Common Stock subject to stock options
exercisable immediately.
(12) Includes 1,650 shares of Common Stock subject to stock options
exercisable immediately.
(13) Includes 5,445 shares of Common Stock subject to stock options
exercisable immediately.
(14) Includes 354,721 shares of Common Stock subject to stock options
exercisable immediately.
4
<PAGE> 8
PROPOSAL NO. 1
ELECTION OF DIRECTORS OF THE CORPORATION
The number of directors authorized for election at this meeting is ten
(10). Management has nominated the ten (10) incumbent directors to serve as the
Corporation's directors. Each director will hold office until the next Annual
Meeting of Shareholders and until his successor is elected and qualified.
All proxies will be voted for the election of the ten (10) nominees
listed below (all of whom are incumbent directors) recommended by the Board of
Directors unless authority to vote for the election of any directors is
withheld. The nominees receiving the highest number of affirmative votes of the
shares entitled to be voted for them shall be elected as directors. Abstentions
and votes cast against nominees have no effect on the election of directors. If
any of the nominees should unexpectedly decline or be unable to act as a
director, their proxies may be voted for a substitute nominee to be designated
by the Board of Directors. The Board of Directors has no reason to believe that
any nominee will be become unavailable and has no present intention to nominate
persons in addition to or in lieu of those named below.
The following table sets forth certain information as of the Record
Date, April 23, 1997, with respect to those persons nominated by the Board of
Directors for election as directors, as well as all executive officers. The
Corporation knows of no arrangements, including any pledge by any person of
securities of the Corporation, the operation of which may, at a subsequent date,
result in a change in control of the Corporation. There are no arrangements or
understandings by which any of the executive officers or directors of either the
Corporation or the Subsidiaries were selected. There is no family relationship
between any of the directors or executive officers.
<TABLE>
<CAPTION>
Name Age Position
- ---- --- --------
<S> <C> <C>
Andrew E. Ausonio 66 Director of the Corporation and of Bank of Salinas since
1994 and 1982, respectively. Director of Cypress Bank since
1996.
Robert C. Blatter 36 Senior Vice President and Loan Administrator of the
Corporation since 1996 and the Loan Administrator of Bank of
Salinas since 1989.
C. Edward Boutonnet 57 Director of the Corporation and of Bank of Salinas since
1994 and 1982, respectively. Director of Cypress Bank
since 1996.
Bradford G. Crandall 62 Director of the Corporation and of Bank of Salinas since
1994 and 1982, respectively. Director of Cypress Bank since
1996.
Alfred P. Glover 65 Director of the Corporation and of Bank of Salinas since
1996. Director of Cypress Bank since 1988.
Richard C. Green 58 Director of the Corporation and of Bank of Salinas since
1994 and 1982, respectively. Director of Cypress Bank since
1996.
Duncan L. McCarter 50 Director of the Corporation and of Bank of Salinas since
1994 and 1982, respectively. Director of Cypress Bank
since 1996.
John F. McCarthy 53 Executive Vice President and Chief Operating Officer of the
Corporation and of Bank of Salinas since December 1994 and
1988, respectively.
</TABLE>
5
<PAGE> 9
<TABLE>
<CAPTION>
Name Age Position
- ---- --- --------
<S> <C> <C>
Robert M. Mraule, M.D. 47 Director of the Corporation and of Bank of Salinas since
1994 and 1982, respectively. Director of Cypress Bank since
1996.
C. Frederick Rowden 52 President and Director of Cypress Bank since 1992.
Thomas A. Sa 35 Senior Vice President, Chief Financial Officer and Secretary
of the Corporation and Bank of Salinas since 1995 and
Cypress Bank since 1996.
Louis A. Souza 68 Director of the Corporation and Bank of Salinas since 1996.
Director of Cypress Bank since 1988.
Mose E. Thomas, Jr. 56 Director of the Corporation and Bank of Salinas since 1996.
Director of Cypress Bank since 1989.
Nick Ventimiglia 55 Chairman, President and Chief Executive Officer of the
Corporation since December 1994. Chairman, President and
Chief Executive Officer of Bank of Salinas since 1994.
</TABLE>
The following is a brief account of the business experience for a minimum of
five years of each director and executive officer listed above in addition to
positions indicated.
<TABLE>
<S> <C>
Andrew E. Ausonio Organizer and Former Chairman of the Board of Directors, Bank of
Salinas; President, Ausonio Construction, Inc., general
contractor; Owner, Ausonio Rentals and Aladin Properties, rental
property companies.
Robert C. Blatter Commercial Banking Officer, Bank of America from 1986 to 1989.
C. Edward Boutonnet Organizer, Bank of Salinas; Partner and General Manager,
California Artichoke and Vegetable Growers Corporation, Sea Mist
Farms, and Boutonnet Farms, Inc.
Bradford G. Crandall President, E.B. Stone & Son, Inc., wholesale nursery supply firm.
Alfred P. Glover Owner, Glover Enterprises, a real estate development firm.
Richard C. Green Retired businessman and former President, Green's Camera Shop,
Inc.
Duncan L. McCarter Pharmacist and President, Care Pharmacies, Inc.; President, Care
Home Medical Services, Inc.
John F. McCarthy Vice President and Regional Manager, Hibernia Bank, Salinas from
1986 to 1988; Vice President and Regional Manager, Crocker
National Bank from 1980 to 1986.
C. Frederick Rowden Director and President of Cypress Bank since 1992. Director and
President of Monterey County Bank prior to 1992.
Robert M. Physician, Dentist, Oral and Maxillofacial Surgeon.
Mraule, D.D.S., M.D.
</TABLE>
6
<PAGE> 10
<TABLE>
<S> <C>
Thomas A. Sa Senior Vice President and Chief Financial Officer, South Valley
Bancorporation and South Valley National Bank from 1994 to
1995. Vice President and Chief Financial Officer, South Valley
Bancorporation and South Valley National Bank from 1992 to
1994. Assistant Vice President and Comptroller, South Valley
Bancorporation and South Valley National Bank from 1989 to 1992.
Louis A. Souza Owner, Louis A. Souza Construction, a general contractor.
Mose E. Thomas, Jr. General Manager, Chapel of Seaside, Inc., and Mission Mortuary,
Inc., funeral chapels.
Nick Ventimiglia Organizer, Director, President and Chief Executive Officer, Bank
of Salinas from 1982 to 1994.
</TABLE>
None of the Directors of the Corporation or the Subsidiaries is a
director of any other company with a class of securities registered pursuant to
Section 12 of the Securities Exchange Act of 1934, as amended, or subject to the
requirements of Section 15(d) of such Act or any company registered as an
investment company under the Investment Company Act of 1940, whose common stock
is registered pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended.
COMMITTEES OF THE BOARD OF DIRECTORS
The Audit and Finance Committees, whose common members include Andrew
E. Ausonio, C. Edward Boutonnet (Chairman), Alfred P. Glover, Duncan L.
McCarter, Robert M. Mraule (Vice Chairman) and Mose E. Thomas, Jr., oversees the
Corporation's and Subsidiaries' independent public accountants, analyzes the
results of internal and regulatory examinations and monitors the financial and
accounting organization and reporting. The Audit Committee met four (4) times
and the Finance Committee met eight (8) times in 1996.
The Board of Directors has not established a nominating committee. The
full Board of Directors performs the functions of a nominating committee with
responsibility for considering appropriate candidates for election as directors.
The Premises, Compensation and Performance Committee, whose members
include Andrew E. Ausonio (Chairman), C. Edward Boutonnet (Vice Chairman),
Duncan L. McCarter, Robert M. Mraule and Mose E. Thomas, Jr., oversees physical
premises used in daily operations and reviews and establishes employee benefits
and the compensation paid to executive officers and other employees. The
Premises, Compensation and Performance Committee met eleven (11) times in 1996.
The ALCO/Compliance/Shareholder Relations Committee, whose members
include Andrew E. Ausonio, Bradford G. Crandall, Alfred P. Glover, Richard C.
Green (Vice Chairman) and Robert M. Mraule (Chairman), has responsibility for
asset/liability management, review of the Corporation's investment portfolio,
maintenance of shareholder relations and monitoirng compliance with State and
Federal regulation of the Corporation and the Subsidiaries. The
ALCO/Compliance/Shareholder Relations Committee met four (4) times in 1996.
The Loan Committee, whose members include Andrew E. Ausonio, C.
Edward Boutonnet (Vice Chairman), Bradford G. Crandall (Chairman), Alfred P.
Glover, Richard C. Green and Louis A. Souza, has responsibility for establishing
loan policy and approving loans which exceed certain dollar limits. The Loan
Committee met twenty-two (22) times in 1996.
The Marketing Committee, whose members include Andrew E. Ausonio,
Richard C. Green (Vice Chairman), Duncan L. McCarter (Chairman) and Louis A.
Souza, has responsibility for administering the
7
<PAGE> 11
Corporation's marketing policies and marketing programs. The Marketing Committee
met eight (8) times in 1996.
During 1996, the Corporation's Board of Directors held twelve (12)
meetings. All Directors attended at least seventy-five percent (75%) of the
aggregate of the total number of meetings of the Board of Directors and the
number of meetings of the committees on which they served.
COMPENSATION OF DIRECTORS
The fees paid to directors during 1996 included a base fee of $2,050
per month for attendance at Board meetings of the Corporation and the
Subsidiaries. In addition to the base fee, the Loan Committee Chairman received
$200 per month, the Chairmen of the Audit, ALCO/Compliance/Shareholder
Relations, Marketing, and the Premises, Compensation and Performance Committees
each received $100 per month. The total amount of fees paid to all Directors as
a group for attendance at Board and committee meetings was $237,000 in 1996.
8
<PAGE> 12
EXECUTIVE COMPENSATION
Set forth below is the summary compensation paid or accrued during the
three years ended December 31, 1996 to Nick Ventimiglia, John McCarthy, Thomas
A. Sa, C. Frederick Rowden and Robert C. Blatter, executive officers of the
Corporation and/or the Subsidiaries.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
- ----------------------------------------------------------------------------------------------------------------------------
LONG-TERM COMPENSATION
----------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Name and Year Salary Bonus Other Restricted Securities LTIP All Other
Principal Position ($) 1/ ($) 2/ Annual Stock Under- Payouts Compen-
Compen- Award(s) lying ($) sation
sation ($) Options/ ($) 5/
($) SARs (#)
3/ 4/
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Nick Ventimiglia, Chairman, 1996 $200,000 $146,000 -- -- 22,500 -- $1,900
President and Chief
Executive Officer
1995 175,000 96,969 -- -- 18,150 -- 1,848
1994 175,000 80,804 -- -- -- -- 1,438
John F. McCarthy, Executive 1996 124,142 94,900 -- -- 15,000 -- 1,722
Vice President and Chief
Operating Officer
1995 118,079 64,638 -- -- -- -- 1,847
1994 116,050 53,868 -- -- -- -- 1,412
Thomas A. Sa, Senior Vice 1996 106,667 80,300 -- -- 15,000 -- 441
President, Chief Financial
Officer and Corporate
Secretary
1995 40,193 21,200 -- -- 8,250 -- --
1994 -- -- -- -- -- -- --
C. Frederick Rowden, 1996 88,139 20,000 7,500 570
President, Cypress Bank
1995 93,031 -- -- -- -- -- --
1994 87,364 -- -- -- -- -- --
Robert C. Blatter, Senior 1996 75,000 55,480 -- -- 7,500 -- 1,819
Vice President and Loan
Administrator
1995 74,833 22,893 -- -- -- -- --
1994 69,598 20,812 -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
1/ Amounts shown include cash and non-cash compensation earned and received by
executive officers as well as amounts earned but deferred at the election
of those officers under the 401(k) Plan. The salary paid to Thomas A. Sa in
1995, was the amount earned in the period from the date of initial
employment, August 7, 1995 through December 31, 1995.
2/ Amounts indicated as bonus payments were earned for performance during
1996, 1995 and 1994.
3/ No executive officer received perquisites or other personal benefits in
excess of the lesser of $50,000 or 10% of each such officer's total annual
salary and bonus during 1996, 1995 or 1994.
4/ The Corporation has a 1994 Stock Option Plan, as amended, (the "1994 Plan")
pursuant to which options may be granted to directors, and key,
full-time salaried officers and employees of the Corporation and the
Subsidiaries. Options granted under the 1994 Plan are either incentive
options or non-statutory options. Options granted under the 1994 Plan
become exercisable in accordance with a vesting schedule established at
the time of grant. Vesting may not extend beyond ten years from the
date of grant. Options granted under the 1994 Plan are adjusted to
protect against dilution in the event of certain changes in the
Corporation's capitalization, including stock splits and stock
dividends. All options granted to the named executive officers were
incentive stock options and have an exercise price equal to the fair
market value of the Corporation's Common Stock on the date of grant.
5/ Amounts shown for each named executive officer are 401(k) matching
contributions for the year indicated.
9
<PAGE> 13
The following table sets forth certain information concerning the grant
of stock options under the Corporation's 1994 Stock Option Plan to the named
executive officers during the fiscal year ended December 31, 1996.
<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
- ------------------------------------------------------------------------------------------------------------------------
Individual Grants
- -------------------------------------------------------------------------------------
Percent of
Total Potential Realizable Value at
Options/ Assumed Annual Rates of Stock
Number of SARs Price Appreciation For Option
Securities Granted Term
Underlying to
-----------------------------------
Options/SARs Employees Exercise or
Granted in Fiscal Base Price Expiration
Name ( # ) Year ( $/Share ) Date 5% ($) 10% ($)
(a) (b) (c) (d) (e) (f) (g)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Nick Ventimiglia 22,500 22% $13.50 12/5/06 $438,413 $877,950
President and
Chief Executive Officer
John McCarthy 15,000 14% $13.50 12/5/06 292,275 585,300
Executive Vice President
and Chief Operating Officer
Thomas A. Sa 15,000 14% $13.50 12/5/06 292,275 585,300
Senior Vice President,
Chief Financial Officer and
Corporate Secretary
C. Frederick Rowden 7,500 7% $13.50 12/5/06 146,138 292,650
President, Cypress Bank
Robert C. Blatter 7,500 7% $13.50 12/5/06 146,138 292,650
Senior Vice President
and Loan Administrator
</TABLE>
10
<PAGE> 14
The following table sets forth the number of shares of Common Stock
acquired by each of the named executive officers upon the exercise of stock
options during fiscal 1996, the net value realized upon exercise, the number of
shares of Common Stock represented by outstanding stock options held by each of
the named executive officers as of December 31, 1996 and the value of such
options based on the closing price of the Corporation's Common Stock and certain
information concerning unexercised options under the 1994 Stock Option Plan.
<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FY-END OPTION/SAR VALUES
- -----------------------------------------------------------------------------------------------------------------
Number of
Securities Value of
Underlying Unexercised
Unexercised in-the-Money
Options/SARs Options/SARs
at Fiscal Year-End at Fiscal Year-
Shares Value (#) End($)
Acquired on Realized Exercisable/ Exercisable/
Name Exercise (#) ($) Unexercisable Unexercisable
(a) (b) (c) (d) (e) 1/
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Nick Ventimiglia $0 $0 7,260 / 33,390 $ 77,972 / $358,609
President and
Chief Executive Officer
John McCarthy $0 $0 35,712 / 23,928 $579,011 / $387,953
Executive Vice President
and Chief Operating Officer
Thomas A. Sa $0 $0 1,650 / 21,600 $ 16,258 / $212,832
Senior Vice President,
Chief Financial Officer and
Corporate Secretary
C. Frederick Rowden $0 $0 17,106 / 7,500 $249,063 / $109,200
President, Cypress Bank
Robert C. Blatter $0 $0 5,590 / 13,090 $ 70,993 / $166,243
Senior Vice President
and Loan Administrator
</TABLE>
1/ The aggregate value has been determined based upon the closing price for
the Corporation's Common Stock at exercise or year-end, minus the
exercise price.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
During 1996, the Bank of Salinas entered into employment agreements
with Messrs. Ventimiglia, President and Chief Executive Officer; McCarthy,
Executive Vice President and Chief Operating Officer; Sa, Senior Vice President
and Chief Financial Officer; and Blatter, Senior Vice President and Loan
Administrator. The agreements provide for an original term of three years with
automatic one-year extensions until the agreements are terminated as described
below. In addition, in January 1997, Cypress Bank entered into a two-year
employment agreement with Mr. Rowden to replace a previously existing agreement.
The agreements provide for a base salary of $200,000 for Mr. Ventimiglia;
$130,000 for Mr. McCarthy; $110,000 for Mr. Sa; $99,000 for Mr. Rowden; and
$76,000 for Mr. Blatter. The base salaries under each agreement are reviewed
annually and are subject to adjustment at the discretion of the Board of
Directors. Additionally, the agreements provide for, among other things: (a) a
discretionary annual bonus based upon the Corporation's achievement of certain
profitability, growth and asset
11
<PAGE> 15
quality standards as established by the Board of Directors; (b) payment of base
salary, reduced by the amounts received from state disability insurance or
workers' compensation or other similar insurance benefits through policies
provided by the Bank; (c) stock option grants under the Corporation's stock
option plan, at the sole discretion of the Board of Directors; (d) four weeks
annual vacation leave; (e) use of an automobile; and (f) reimbursement for
ordinary and necessary expenses incurred in connection with employment.
The agreements may be terminated with or without cause, but if the
agreements are terminated due to the occurrence of circumstances that make it
impossible or impractical for the Employer to conduct or continue its business,
the loss by the Employer of its legal capacity to contract or the Employer's
breach of the terms of the agreement the employee is entitled to receive
severance compensation equal to six months of the existing base salary. The
agreements further provide that in the event of a "change in control" as defined
therein and within a period of two years following consummation of such change
in control: (a) the employee's employment is terminated; or (b) any adverse
change occurs in the nature and scope of the employee's position,
responsibilities, duties, salary, benefits or location of employment; or (c) any
event occurs which reasonably constitutes a demotion, significant diminution or
constructive termination of employment, then the employee will be entitled to
receive severance compensation in an amount equal to a multiple of the
employee's average annual compensation for the five years immediately preceding
the change in control as follows: (a) two times for Mr. Ventimiglia; (b) one and
one-half times for Messrs. McCarthy and Sa; and (c) one times for Messrs. Rowden
and Blatter.
Recognizing the importance of building and retaining a competent
management team, additional agreements were entered into to provide
post-retirement benefits to the above named employees. The terms of the
agreements amounts each employee will receive upon the occurrence of certain
specified events, including formal retirement on or after a specified age. The
agreements generally provide for annual retirement benefit payments of Ninety
Thousand Dollars ($90,000) to Mr. Ventimiglia, Seventy Thousand Dollars
($70,000) to Mr. McCarthy, Fifty-Five Thousand Dollars ($55,000) to Mr. Sa,
Fifty Thousand Dollars ($50,000) to Mr. Rowden and Forty-Five Thousand Dollars
($45,000) to Mr. Blatter. The annual retirement benefit amount is payable in
equal monthly installments over a fifteen (15) year period. In the event of an
employee's death, all remaining amounts due are anticipated to be paid to the
employee's designated beneficiary over the remaining payout period. Other events
which may alter when payment of the annual retirement benefit is to begin, or
the amount which is to be paid, include: (a) disability prior to retirement in
which case the employee shall be entitled to a lesser benefit payment amount
based upon the length of employment; and (b) either termination of employment
without cause or constructive termination following a "change of control," in
which case the employee is entitled to receive the full annual benefit payment
in equal monthly installments for fifteen (15) years beginning in the month
following the termination or "change of control." Generally, in those situations
where the employee is terminated for cause, or where the employee voluntarily
terminates his employment prior to retirement or other event triggering a right
to payments under the agreement, the employee is not entitled to the payment of
any benefits.
12
<PAGE> 16
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The compensation of the executive officers of the Corporation and the
Subsidiaries is reviewed and approved annually by the Board of Directors on
recommendation by the Premises, Compensation and Performance Committee (the
"Committee"). During 1996, Messrs. Ausonio, Boutonnet, McCarter, Mraule and
Thomas were members of the Committee. Messrs. Ventimiglia, McCarthy, Sa, Rowden
and Blatter serve as executive officers of the Corporation and/or the
Subsidiaries.
The Committee's philosophy is that compensation should be designed to
reflect the value created for shareholders while supporting the Corporation's
strategic goals. The Committee reviews annually the compensation of the
executive officers to insure that the Corporation's compensation programs are
related to financial performance and consistent generally with employers of
comparable size in the industry. Annual compensation for the Corporation's
executive officers includes the following components:
1) Base salary is related to the individual officer's level of
responsibility and comparison with comparable employers in the industry.
2) Annual cash bonuses are based on individual and Corporation
performance. Factors evaluated include the achievement of certain profitability,
growth and asset quality standards as established by the Board of Directors. The
bonus compensation is funded from the Corporation's pre-tax income. While many
of the factors considered in determining whether to award a bonus are objective,
the Committee recommendation may also include certain subjective factors as part
of the bonus analysis. During 1996, bonuses were recommended by the Committee
for each of the named executive officers. See SUMMARY COMPENSATION TABLE.
3) Stock option grants are intended to increase the executive officers'
interest in the Corporation's long-term success and to link the interests of the
executive officers with those of the shareholders as measured by the
Corporation's share price. Stock options are granted at the prevailing market
value of the Corporation's Common Stock and will only have value if the
Corporation's stock price increases. See SUMMARY COMPENSATION TABLE, OPTION/SAR
GRANTS TABLE AND OPTION/SAR EXERCISE TABLE, and notes thereto for further
description of stock options.
4) The Corporation matches salary deferred by emplyees participating
in its 401(k) Plan at a rate determined annually by the Board of Directors ( 20%
of salary deferred for 1996 ). Executive officers are eligible to participate in
the 401(k) plan. See SUMMARY COMPENSATION TABLE.
13
<PAGE> 17
COMPARISON OF CENTRAL COAST BANCORP SHAREHOLDER RETURN
Set forth below is a line graph comparing the annual percentage change in
the cumulative total return on the Corporation's Common Stock with the
cumulative total return of the SNL Securities Index of National Peer Banks
(asset size of $250 million-$500 million) and the S&P 500 as of the end of each
of the Corporation's last five fiscal years.
[GRAPHIC OMITTED]
<TABLE>
<CAPTION>
PERIOD ENDING
--------------------------------------------------------------------------
Index 12/31/91 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CENTRAL COAST BANCORP 100.00 114.85 105.18 127.29 168.74 246.11
S&P 500 100.00 107.62 118.47 120.03 165.13 202.89
SNL BANKS ($250M - $500M) INDEX 100.00 136.43 178.91 193.04 260.50 338.26
</TABLE>
(1) Assumes that $100.00 was invested on December 31, 1991 in Central Coast
Bancorp Common Stock and each index, and that all dividends were
reinvested. Returns have been adjusted for stock dividends and stock
splits declared by Central Coast Bancorp. Shareholder returns over the
indicated period should not be considered indicative of future
shareholder returns.
14
<PAGE> 18
CHANGES IN CONTROL
The corporation knows of no arrangements, including any pledge by any
person of securities of the Corporation, the operation of which may, at a
subsequent date, result in a change of control of the Corporation.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors, executive officers and ten percent or more shareholders
of the Corporation's equity securities, to file with the Securities and Exchange
Commission initial reports of ownership and reports of changes of ownership of
the Corporation's equity securities. Officers, directors and ten percent or more
shareholders are required by SEC regulation to furnish the Corporation with
copies of all Section 16(a) forms they file. To the Corporation's knowledge,
based solely on review of the copies of such reports furnished to the
Corporation and written representations that no other reports were required,
during the fiscal year ended December 31, 1996, except for directors Souza and
Glover, each of whom failed to timely file one report on Form 3, all Section
16(a) filing requirements applicable to its executive officers, directors and
beneficial owners of ten percent or more of the Corporation's equity securities
appear to have been met.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
TRANSACTIONS WITH MANAGEMENT AND OTHERS
There have been no transactions, or series of similar transactions,
during 1996, or any currently proposed transaction, or series of similar
transactions, to which the Corporation or the Subsidiaries was or is to be a
party, in which the amount involved exceeded or will exceed $60,000 and in which
any director of the Corporation or the Subsidiaries, executive officer of the
Corporation or the Subsidiaries, any shareholder owning of record or
beneficially 5% or more of the Corporation's Common Stock, or any member of the
immediate family of any of the foregoing persons, had, or will have, a direct or
indirect material interest.
CERTAIN BUSINESS RELATIONSHIPS
There were no business relationships during 1996 of the type
requiring disclosure under Item 404(b) of Regulation S-K.
INDEBTEDNESS OF MANAGEMENT
The Corporation, through the Subsidiaries, has had, and expects in the
future to have banking transactions in the ordinary course of its business with
many of the Corporation's directors and officers and their associates, including
transactions with corporations of which such persons are directors, officers or
controlling shareholders, on substantially the same terms (including interest
rates and collateral) as those prevailing for comparable transactions with
others. Management believes that in 1996 such transactions comprising loans did
not involve more than the normal risk of collectibility or present other
unfavorable features. Loans to executive officers of the Corporation and the
Subsidiaries are subject to limitations as to amount and purposes prescribed in
part by the Federal Reserve Act, as amended, and the regulations of the Federal
Deposit Insurance Corporation.
15
<PAGE> 19
PROPOSAL NO. 2
RATIFICATION AND APPOINTMENT OF
INDEPENDENT PUBLIC ACCOUNTANTS
The firm of Deloitte & Touche LLP served the Corporation and the
Subsidiaries as independent public accountants for the 1996 fiscal year.
Deloitte & Touche LLP has no interest, financial or otherwise, in the
Corporation or the Subsidiaries. The services rendered by Deloitte & Touche LLP
during the 1996 fiscal year were audit services, consultation in connection with
various accounting matters and preparation of corporation income tax returns.
The Boards of Directors of the Corporation and the Subsidiaries approved each
professional service rendered by Deloitte & Touche LLP during the 1996 fiscal
year, and the possible effect of each such service on the independence of that
firm was considered by the Boards of Directors before such service was rendered.
Representatives of Deloitte & Touche LLP are expected to be present at
the Meeting and will have an opportunity to make a statement if they so desire
and to answer appropriate questions.
The Board of Directors of the Corporation has selected Deloitte &
Touche LLP to serve as the independent public accountants for the 1997 fiscal
year and recommend that the shareholders vote FOR approval to ratify the
selection of Deloitte & Touche LLP as the Corporation's independent public
accountants for the 1997 fiscal year.
ANNUAL REPORT
The Annual Report of the Corporation containing audited financial
statements for the fiscal year ended December 31, 1996 is included in this
mailing to shareholders.
FORM 10-K
A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED, IS AVAILABLE TO SHAREHOLDERS WITHOUT CHARGE UPON WRITTEN REQUEST TO
THOMAS A. SA, SECRETARY, CENTRAL COAST BANCORP, 301 MAIN STREET, SALINAS,
CALIFORNIA, 93901.
SHAREHOLDERS' PROPOSALS
Next year's Annual Meeting of Shareholders will be held on May 21,
1998. The deadline for shareholders to submit proposals for inclusion in the
Proxy Statement and form of Proxy for the 1998 Annual Meeting of Shareholders is
December 30, 1997. All proposals should be submitted by Certified Mail - Return
Receipt Requested, to Thomas A. Sa, Secretary, Central Coast Bancorp, 301 Main
Street, Salinas, California, 93901.
16
<PAGE> 20
OTHER MATTERS
The Board of Directors knows of no other matters which will be brought
before the Meeting, but if such matters are properly presented to the Meeting,
proxies solicited hereby will be voted in accordance with the judgment of the
persons holding such proxies. All shares represented by duly executed proxies
will be voted at the Meeting in accordance with the terms of such proxies.
CENTRAL COAST BANCORP
Salinas, California
April 28, 1997 By:/s/Thomas A Sa
--------------------
Thomas A. Sa
Secretary
17
<PAGE> 21
PROXY PROXY
CENTRAL COAST BANCORP
Proxy for the Annual Meeting of Stockholders To Be Held May 22, 1997
This Proxy is Solicited on Behalf of the Board of Directors.
The undersigned holder of Common Stock acknowledges receipt of a copy of the
Notice of Annual Meeting of Shareholders of Central Coast Bancorp and the
accompanying Proxy Statement dated April 28, 1997, and revoking any Proxy
heretofore given, hereby constitutes and appoints Andrew F. Ausonio, C. Edward
Boutonnet, and Nick Ventimiglia and each of them, with full power of
substitution, as attorneys and proxies to appear and vote all of the shares of
Common Stock of Central Coast Bancorp, a California corporation, standing in
the name of the undersigned which the undersigned could vote if personally
present and acting at the Annual Meeting of Shareholders of Central Coast
Bancorp, to be held at 301 Main Street, Salinas, California on Thursday, May
22, 1997, at 5:30 p.m. or at any postponements or adjournments thereof, upon
the following items as set forth in the Notice of Meeting and Proxy Statement
and to vote according to their discretion on all other matters which may be
properly presented for action at the Meeting or any postponements or
adjournments thereof. The above-named proxy holders are hereby granted
discretionary authority to cumulate votes represented by the shares covered by
this Proxy in the election of directors.
UNLESS OTHERWISE SPECIFIED THIS PROXY WILL BE VOTED "FOR" THE FOLLOWING ITEMS:
<TABLE>
<S> <C>
1. To elect as directors the nominees set forth below: [ ] WITHHOLD AUTHORITY
[ ] FOR all nominees listed below to vote for all nominees listed below.
(except as marked to the contrary below).
</TABLE>
INSTRUCTION: To withhold authority to vote for any individual nominee, strike
a line through the nominee's name in the list below:
<TABLE>
<S> <C> <C>
Andrew E. Ausonio Richard C. Green Louis A. Souza
C. Edward Boutonnet Duncan L. McCarter Mose E. Thomas, Jr.
Branford G. Crandall Robert M. Mraule, D.D.S., M.D. Nick Ventimiglia
Alfred P. Glover
</TABLE>
2. To approve the appointment of Deloitte & Touche LLP as independent
public accountants for the 1997 fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. To transact such other business as may properly come before the meeting.
<PAGE> 22
THIS PROXY IS SOLICITED BY AND ON BEHALF OF THE BOARD OF DIRECTORS AND MAY BE
REVOKED PRIOR TO ITS EXERCISE. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF DIRECTORS NOMINATED BY THE BOARD OF DIRECTORS AND "FOR"
PROPOSAL NO. 2. THE PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED. IF
NO DIRECTION IS MADE, IT WILL BE VOTED "FOR" THE ELECTION OF DIRECTORS
NOMINATED BY THE BOARD OF DIRECTORS AND "FOR" PROPOSAL NO. 2.
No. of Common Shares
I/We do [ ] or do not [ ] expect to attend this
Meeting.
Dated:___________________________________, 1997
SHAREHOLDER(S)
Please date and sign exactly as your name(s) appear(s). When signing as
attorney, executor, administrator, trustee, or guardian, please give full
title. If more than one trustee, all should sign. All joint owners should sign.
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASE SIGN AND RETURN THIS
PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
