<PAGE>
As filed with the Securities and Exchange Commission on November 14, 1997
Registration No. 333- ________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
COMMUNITY BANK SHARES OF INDIANA, INC.
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(Exact name of Registrant as specified in its charter)
Indiana 6711 35-1938254
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(State or other juris- (Primary Standard (I.R.S. Employer
diction of incorporation Industrial Classification Identification No.)
or organization) Code No.)
202 East Spring Street
New Albany, Indiana 47150
(812) 944-2224
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(Address, including zip code and telephone number, including area code,
of Registrant's principal executive offices)
Robert E. Yates
President and Chief Executive Officer
Community Bank Shares of Indiana, Inc.
202 East Spring Street
New Albany, Indiana 47150
(812) 944-2224
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(Name, address, including zip code, and telephone number, including area
code, of agent for service)
with a copy to:
Raymond A. Tiernan, Esq
Kenneth B. Tabach, Esq.
Elias, Matz, Tiernan & Herrick L.L.P.
734 15th Street, N.W.
Washington, D.C. 20005
(202) 347-0300
Approximate date of commencement of proposed sale to the public: As soon
as practicable after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. /x/
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities
Act of 1933, other than securities offered only in connection with dividend
or interest reinvestment plans, check the following box. / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(b)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
<TABLE>
<CAPTION>
Calculation of Registration Fee
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Amount to Proposed Maximum Proposed Maximum
Title of Each Class of be Offering Price Aggregate Offering Amount of
Securities to be Registered Registered Per Share Price(1) Registration Fee
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<S> <C> <C> <C> <C>
Common Stock, par value $.10 per share 100,000 $21.25(2) $2,125,000 $644
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</TABLE>
(1) Estimated solely for purposes of calculating the registration fee.
(2) Based upon the average of the bid and ask prices of a share of Common
Stock as reported by the Nasdaq Stock Market on November 10, 1997 pursuant to
Rule 457(c) of the Securities Act of 1933.
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<PAGE>
PROSPECTUS
COMMUNITY BANK SHARES OF INDIANA, INC.
DIVIDEND REINVESTMENT PLAN
100,000 shares of Common Stock
(par value, $.10 per share)
This Prospectus relates to 100,000 shares of common stock, par value $.10
per share (the "Common Stock") of Community Bank Shares of Indiana, Inc. (the
"Company") registered for purchase under the Community Bank Shares of
Indiana, Inc. Dividend Reinvestment Plan (the "Plan"). The Company is
registering these shares of Common Stock for issuance pursuant to the Plan.
The Plan provides each holder of Common Stock with a method of purchasing
additional shares of Common Stock through the reinvestment of all or a
portion of dividends without payment of any brokerage commissions or other
administrative fees of any kind.
Shares of Common Stock available under the Plan may be obtained, at the
option of the Company, on the open market, from treasury shares held by the
Company or from the legally authorized, but unissued shares of Common Stock
held by the Company. The purchase price for shares obtained under the Plan
will be based upon the market price of the Common Stock.
Each participant in the Plan should recognize that neither the Company
nor Registrar and Transfer Company, the transfer agent administering the Plan
for the Company, can provide any assurance that shares of Common Stock
purchased under the Plan will, at any time, be worth more or less than their
purchase price.
The Plan does not represent a change in the dividend policy of the
Company, which will continue to depend upon earnings, financial requirements
and other factors, and which will be determined by the Company's Board of
Directors from time to time. Stockholders who do not wish to participate in
the Plan will continue to receive cash dividends as declared. It is
suggested that this Prospectus be retained for future reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is November 14, 1997.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy and information statements and
other information with the Securities and Exchange Commission (the
"Commission"). Reports, proxy and information statements and other
information filed by the Company can be inspected and copied at the public
references facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. and at its Regional Offices at 75 Park Place, New York, New
York 10007, and copies of such material can be obtained at prescribed rates
from the Public Reference Section of the Commission at 450 Fifth Street
N.W., Judiciary Plaza, Washington, D.C. 20549.
The Company has filed with the Commission a registration statement
on Form S-3 (such registration statement, together with all amendments and
exhibits thereto, being hereinafter referred to as the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities
Act"), for the registration under the Securities Act of the shares of Common
Stock offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain parts of which
are omitted in accordance with the rules and regulations of the Commission.
Reference is hereby made to the Registration Statement for further
information with respect to the Company and the Common Stock offered hereby.
Statements contained herein concerning the provisions of documents filed as
exhibits to the Registration Statement are necessarily summaries of such
documents, and each such statement is qualified in its entirety by reference
to the copy of the applicable document filed with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates in this Prospectus by reference the
following documents heretofore filed with the Commission:
(i) The Company's Annual Report on Form 10-K for the year ended
December 31, 1996;
(ii) The Company's Quarterly Reports on Form 10-Q for the three months
ended March 31, 1997, June 30, 1997 and September 30, 1997;
(iii) The Company's Current Reports on Form 8-K filed on February 12,
1997, April 22, 1997 and June 30, 1997; and
(iv) The description of the Company's Common Stock which is contained
in the Company's Registration Statement on Form 8-A.
In addition, all documents subsequently filed by the Company with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
after the date of this
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<PAGE>
Prospectus and prior to the termination of this offering shall be deemed
incorporated by reference into this Prospectus and to be a part hereof from
the date of filing of such documents. Any statement contained herein or in a
document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, upon such person's written or oral request, a
copy of any and all of the documents which are incorporated by reference
herein (other than exhibits to such documents, unless such exhibits are
specifically incorporated by reference into such documents). Such requests
should be directed to Community Bank Shares of Indiana, Inc., 202 East Spring
Street, New Albany, Indiana 47150, Attention: Pamela Echols, Assistant
Corporate Secretary, telephone: (812) 944-2224.
THE COMPANY
Community Bank Shares of Indiana, Inc. (the "Company") is an Indiana
corporation and the bank holding company for Community Bank of Southern
Indiana and Heritage Bank of Southern Indiana (the "Banks"). Community Bank
of Southern Indiana and Heritage Bank of Southern Indiana are state-chartered
stock commercial banks headquartered in New Albany, Indiana and
Jeffersonville, Indiana, respectively. The Banks are regulated by the
Indiana Department of Financial Institutions and the Federal Deposit of
Insurance Corporation (the "FDIC"). The principal source of funds for
dividend payments by the Company is dividends paid by the Banks to the
Company. The amount of dividends paid by the Banks is limited by state and
federal laws and regulations.
The offices of the Company are located at 202 East Spring Street, New
Albany, Indiana 47150. The telephone number of the Company is (812) 944-2224.
The provisions of the Company's Dividend Reinvestment Plan (the "Plan")
are presented herein in a question and answer format. Those stockholders who
do not participate in the Plan will continue to receive cash dividends, if
and when declared.
THE PLAN
The Plan provides stockholders with a simple method of obtaining
additional shares of Common Stock by reinvesting all or a portion of their
cash dividends without payment of any brokerage commission or administrative
commissions or fees. The only cost to a participant is a termination fee if
the participant decides to withdraw from the Plan. The Plan will be
administered by the Company's stock transfer agent, Registrar and Transfer
Company, having an office at 10 Commerce Drive, Cranford, New Jersey 07016.
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<PAGE>
INVESTMENT CONSIDERATIONS
Purchase Price
The purchase price of the Common Stock purchased under the Plan is based
upon the market price of the Common Stock as listed on The Nasdaq Stock
Market, Small-Cap Market.
Shares Not Deposits
Potential investors should be aware that shares of the Common Stock
purchased under the Plan are not deposit accounts of the Banks and are not
insured by the FDIC or any other governmental organization. An investment in
the Common Stock is subject to market risk and possible loss of investment.
DESCRIPTION OF THE PLAN
The following provides a description of the Plan in question and answer
format.
1. WHAT IS THE PURPOSE OF THE PLAN?
The purpose of the Plan is to provide stockholders of the Company with an
opportunity to increase their investment in the Common Stock without paying
brokerage commissions or other administrative fees of any kind. Through the
reinvestment of all or a portion of dividends, stockholders may purchase
additional whole or fractional shares of the Common Stock under the Plan.
2. WHO ADMINISTERS THE PLAN?
The Plan is administered by Registrar and Transfer Company, the Company's
transfer agent ("R&T"). R&T, acting as agent for each participant, will
apply cash dividends on Common Stock subject to the Plan (including shares
held in the participant's name and shares accumulated under the Plan), to the
purchase of additional whole and fractional shares of Common Stock for such
participant.
Any questions and correspondence concerning the Plan should be directed
to: Registrar and Transfer Company, Dividend Reinvestment Plans, 10 Commerce
Drive, Cranford, New Jersey 07016, telephone: 1-800-368-5948.
Any written correspondence sent to R&T should refer to Community Bank
Shares of Indiana, Inc. or include the top portion of a participant's
account statement with such correspondence.
4
<PAGE>
3. WHO IS ELIGIBLE TO PARTICIPATE IN THE PLAN?
All stockholders of record of the Company are eligible to participate in
the Plan. Any stockholders whose shares are registered in names other than
their own (i.e. the name of a brokerage firm, bank or nominee) must become
stockholders of record by having their shares transferred into their own
names in order to participate in the Plan. Once a stockholder becomes a
registered stockholder of record, he or she will be eligible to participate
in the Plan and may do so by completing an authorization card.
4. HOW DOES A STOCKHOLDER ENROLL IN THE PLAN?
Stockholders may enroll in the Plan by completing an authorization card.
If R&T receives the signed authorization card at least 10 days prior to the
date on which a dividend will be paid ("Dividend Payment Date"), the Plan
will become effective for the participant as of that Dividend Payment Date.
Otherwise, the Plan will be effective for such participant as of the next
Dividend Payment Date.
5. WHAT PORTION OF DIVIDENDS MAY BE REINVESTED PURSUANT TO THE PLAN?
Participants in the Plan may elect that all dividends are reinvested
pursuant to the Plan or that a specified percentage (25%, 50% or 75%) of
their dividends are reinvested in the Plan. Participants shall direct on the
authorization card the desired level of participation in the Plan.
6. WHAT IS THE PURCHASE PRICE FOR SHARES PURCHASED UNDER
THE PLAN?
Participants under the Plan may reinvest all or a portion of their cash
dividends to purchase additional whole or fractional shares of Common Stock
which will be credited to their accounts. Dividends on the shares of Common
Stock credited to a participant's account under the Plan will also be
reinvested for the participants, thereby compounding their investments. All
shares of Common Stock purchased pursuant to the Plan will be purchased
either directly from the Company, in which case the shares will be issued by
the Company out of treasury shares or its legally authorized but unissued
shares of Common Stock, or on the open market at then current market prices.
The choice of whether shares will be purchased from the Company or on the
open market will be determined by the Company in its discretion, based on the
best interests of the Company.
The purchase price for Common Stock purchased under the Plan directly
from the Company will be equal to the average market price of Common Stock
for the 10 business days preceding the Dividend Payment Date as reported by
The Nasdaq Stock Market Small-Cap Market. The purchase price for Common
Stock purchased through the Plan on the open market will be R&T's purchase
price for the Common Stock.
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<PAGE>
7. WHEN WILL PURCHASES OF SHARES BE MADE?
R&T will make every reasonable effort to invest all dividend payments as
promptly after receipt as possible. Participants' funds held by R&T prior to
purchase during this period will not bear interest. Investment in the Common
Stock will then be completed as soon as possible.
8. HOW WILL PURCHASES UNDER THE PLAN BE MADE?
All purchases of Common stock under the Plan will be made, at the
discretion of the Company, either directly from the Company and issued out
of the Company's legally authorized but unissued shares or on the open
market.
9. HOW MANY SHARES OF COMMON STOCK WILL BE CREDITED TO
PARTICIPANTS?
For each participant in the Plan, the specified percentage of such
participant's dividend will be used to purchase the Common Stock. If the
amount purchased is not equal to an exact whole number of shares, the
participant's account will be credited with a fractional share (calculated to
four decimal places).
10. WILL CERTIFICATES BE ISSUED FOR COMMON STOCK PURCHASES?
The shares of Common Stock purchased under the Plan will be held by R&T
in a participant's account without charge. Upon receipt of a written request
from a participant and payment of a fee of $15, the Company will issue a
certificate or certificates representing the whole shares of Common Stock in
such participant's account.
11. WHAT HAPPENS IF A PARTICIPANT SELLS ALL OF THE SHARES FOR
WHICH THE PARTICIPANT HAS RECEIVED A CERTIFICATE?
Participation in the Plan will apply to all shares of Common Stock that
are registered to a Participant at the time of enrollment, plus all shares of
Common Stock that the Participant acquires while his or her authorization
remains in effect. If a participant sells all the shares for which he has a
certificate, but his participation in the Plan is not terminated, dividends
on the shares of Common Stock held in such participant's account under the
Plan will continue to be reinvested.
12. ARE THERE ANY FEES OR EXPENSES INCURRED BY PARTICIPANTS IN
THE PLAN?
There are no additional fees or expenses charged to stockholders who
participate in the Plan. The Company will pay all brokerage commissions and
administrative fees
6
<PAGE>
connected with a stockholder's participation in the Plan. The only cost to
a participant is a termination fee if the participant decides to withdraw
from the Plan.
13. HOW DOES A PARTICIPANT WITHDRAW FROM THE PLAN?
A participant may withdraw from the Plan at any time and for any reason.
The participant must give R&T written notice of withdrawal from the Plan at
least 10 days before a Dividend Payment Date. The notice should include a
termination fee of $25. Upon termination, the Company will provide the
participant with a certificate for the total number of whole shares credited
to such participant's account under the Plan and a check for any fraction of
a share of Common Stock valued at the then current market price of the Common
Stock. R&T may also terminate a participant's account at any time in its
discretion by notice in writing mailed to the participant.
14. HOW WILL A PARTICIPANT'S COMMON STOCK BE VOTED AT MEETINGS
OF STOCKHOLDERS?
Each participant will have the sole right to vote any whole shares (but
not fractional shares) purchased for such participant's account under the
Plan on the record date for a vote. Shares for which no voting instructions
are received will not be voted.
15. WHO INTERPRETS THE PLAN?
R&T, as transfer agent for the Company, will interpret the Plan. The
terms, conditions, and operations of the Plan are governed by the laws of the
State of Indiana.
16. WHAT REPORTS WILL BE SENT TO PARTICIPANTS IN THE PLAN?
R&T will provide each participant with an account statement each time
shares of Common Stock are purchased for the participant under the Plan. The
statement will show the total number of whole and fractional shares in the
participant's account as of a certain date, as well as the amount of the most
recent dividend, the number of shares of Common Stock purchased and the price
per share.
Dividends on the accumulated shares and any fees paid on each
participant's behalf by the Company will be included in an information tax
return filed with the Internal Revenue Service. A copy of this return will
also be supplied to participants.
17. MAY THE PLAN BE AMENDED, SUPPLEMENTED OR TERMINATED?
The Plan may be amended, supplemented or terminated by R&T or the Company
at any time by the delivery of written notice to each participant at least 30
days prior to the effective date of the amendment, supplement or
termination. Any amendment or
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<PAGE>
supplement shall be deemed to be accepted by the participant unless prior to
its effective date, R&T receives written notice of termination of the
participant's account under the Plan.
18. WHAT IS THE RESPONSIBILITY OF THE COMPANY AND R&T
UNDER THE PLAN?
Neither the Company nor R&T shall have any responsibility beyond the
exercise of ordinary care for any action taken or omitted pursuant to the
Plan; nor shall they have any duties, responsibilities or liabilities except
as are expressly set forth herein; nor shall they be liable for any act done
in good faith or for any good faith omission to act; nor shall they have any
liability in connection with an inability to purchase shares or with respect
to the timing or the price of any purchase.
19. HOW IS A RIGHTS OFFERING, STOCK DIVIDEND, OR STOCK SPLIT
HANDLED UNDER THE PLAN?
Any stock dividend or stock split applicable to shares of Common Stock
held by a participant under the Plan, whether held in the participant's
account or in the participant's own name, will be credited to the
participant's account. In the event the Company makes available to
stockholders the rights to purchase additional shares or securities,
participants under the Plan will receive a subscription warrant for such
rights directly from R&T.
20. WHAT IS THE TAX STATUS OF REINVESTED CASH DIVIDENDS AND
SHARES OF COMMON STOCK ACQUIRED THROUGH THE PLAN?
For federal income tax purposes, participants in the Plan who have their
cash dividends reinvested in Common Stock under the Plan will be treated the
same as nonparticipants with respect to the cash dividends on their shares
of Common Stock which are reinvested in Common Stock under the Plan. All
participants in the Plan will be treated as having received on each Dividend
Payment Date, the full amount of the cash dividend for that Dividend Payment
Date regardless of whether the cash dividends are actually received or are
applied to the purchase of shares of Common Stock under the Plan.
Participants in the Plan who have their cash dividends reinvested in
Common Stock will also be treated as if they actually received a cash
dividend to the extent and in the amount that any administrative fees are
paid by the Company on their behalf. Each participant in the Plan will have
a tax basis in the shares of Common Stock purchased equal to the amount of
cash dividends applied to the purchase of such shares of Common Stock plus
any administrative fees which was treated as a cash dividend actually paid to
such participant.
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<PAGE>
USE OF PROCEEDS
The Company does not know precisely the number of shares of its Common
Stock that it will ultimately sell under the Plan or the prices at which
those shares will be sold. The net proceeds from the sale of Common Stock
offered pursuant to the Plan will be used for general corporate purposes,
including without limitation, investments in and advances to the Banks and
any other subsidiaries which the Company may form or acquire.
LEGAL OPINION
The validity of the shares of Common Stock offered hereby is being passed
upon for the Company by Elias, Matz, Tiernan & Herrick L.L.P., Washington,
D.C.
EXPERTS
The financial statements of the Company incorporated by reference from
the Company's Annual Report on Form 10-K for the year ended December 31, 1996
have been audited by Monroe Shine & Co., Inc., independent public
accountants, as indicated in their report with respect thereto and are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
INDEMNIFICATION
Chapter 37 of the Indiana Business Corporation Law sets forth
circumstances under which directors, officers, employees and agents may be
insured or indemnified against liability which they may incur in their
capacity as such. The Articles of Incorporation of the Company provide for
indemnification of directors, officers, employees and agents of the Company
to the full extent permitted by Indiana law. Such indemnity shall extend to
expenses, including attorney's fees, judgments, fines and amounts paid in the
settlement, prosecution or defense of the foregoing actions.
With respect to possible indemnification of officers, directors,
employees and agents of the Company for liabilities arising under the
Securities Act, the Company has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus, and, if given or made, such information or representation must
not be relied upon as having been authorized by the Company. This
Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, any of the securities offered hereby in any jurisdiction in
which, or to any person to whom, such offer or solicitation may not lawfully
be made. Neither the delivery of this Prospectus nor any sales made
hereunder shall, under any circumstances, create any implication that the
information contained herein is correct as of any time subsequent to the date
hereof.
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
SEC Registration Fee .................................$ 644
Legal Fees and Expenses............................... 2,000
Accounting Fees and Expenses.......................... 2,000
Printing Fees and Expenses............................ 2,000
Miscellaneous......................................... 1,356
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TOTAL: ........................................$ 8,000
Item 15. Indemnification of Directors and Officers.
Chapter 37 of the Indiana Business Corporation Law sets forth
circumstances under which directors, officers, employees and agents may be
insured or indemnified against liability which they may incur in their
capacity as such. The Articles of Incorporation of the Company provide for
indemnification of directors, officers, employees and agents of the Company
to the full extent permitted by Indiana law. Such indemnity shall extend to
expenses, including attorney's fees, judgments, fines and amounts paid in the
settlement, prosecution or defense of the foregoing actions.
Item 16. Exhibits.
Exhibit No. Description
- ----------- -----------
4 Dividend Reinvestment Plan
5 Opinion of Elias, Matz, Tiernan & Herrick L.L.P.
23.1 Consent of Monroe Shine & Co., Inc.
23.2 The consent of Elias, Matz, Tiernan & Herrick L.L.P. is contained
in their opinion filed as Exhibit 5 to this Registration Statement
99 Authorization Card for Participation in the Dividend Reinvestment
Plan
II-1
<PAGE>
Item 17. Undertakings.
The undersigned Registrant hereby undertakes to file during any period in
which offers or sales are being made, a post-effective amendment to this
Registration Statement to include any material information with respect to
the plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the Registration
Statement.
The undersigned Registrant hereby undertakes that, for the purpose of
determining any liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
The undersigned Registrant hereby undertakes to remove from registration
by means of a post-effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New Albany, State of Indiana on the
28th day of October 1997.
COMMUNITY BANK SHARES OF INDIANA, INC.
By: /s/ Robert E. Yates
--------------------------------------
Robert E. Yates
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each of the directors and/or officers
of Community Bank Shares of Indiana, Inc. whose signature appears below
hereby appoints Robert E. Yates and C. Thomas Young, and each of them
severally, as his or her attorney-in-fact to sign in his or her name and
behalf, in any and all capacities stated below and to file with the
Securities and Exchange Commission any and all amendments, including
post-effective amendments, to this Registration Statement on Form S-3, making
such changes in the Registration Statement as appropriate, and generally to
do all such things in their behalf in their capacities as directors and/or
officers to enable Community Bank Shares of Indiana, Inc. to comply with the
provisions of the Securities Act of 1933, and all requirements of the
Securities and Exchange Commission.
/s/ C. Thomas Young Date: October 28, 1997
- ---------------------------------
C. Thomas Young
Chairman of the Board
/s/ Gary L. Libs Date: October 28, 1997
- ---------------------------------
Gary L. Libs
Director
II-3
<PAGE>
/s/ James W. Robinson Date: October 28, 1997
- ---------------------------------
James W. Robinson
Director
/s/ Timothy T. Shea Date: October 28, 1997
- ---------------------------------
Timothy T. Shea
Vice Chairman
/s/ Robert E. Yates Date: October 28, 1997
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Robert E. Yates
Director, President and
Chief Executive Officer
/s/ Robert J. Koetter, Sr. Date: October 28, 1997
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Robert J. Koetter, Sr.
Director
/s/ James Stutsman Date: October 28, 1997
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James Stutsman
Senior Vice President and Chief
Financial Officer
/s/ Steve Stemler Date: October 28, 1997
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Steve Stemler
Director
/s/ Gordon Huneilman Date: October 28, 1997
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Gordon Huneilman
Director
/s/ Dale Orem Date: October 28, 1997
- ---------------------------------
Dale Orem
Director
/s/ Kerry Stemler Date: October 28, 1997
- ---------------------------------
Kerry Stemler
Director
II-4
<PAGE>
Exhibit Index
Exhibit No. Description
- ----------- -----------
4 Dividend Reinvestment Plan
5 Opinion of Elias, Matz, Tiernan & Herrick L.L.P.
23.1 Consent of Monroe Shine & Co., Inc.
23.2 The consent of Elias, Matz, Tiernan & Herrick L.L.P. is
contained in their opinion filed as Exhibit 5 to this
Registration Statement
99 Authorization Card for Participation in the Dividend
Reinvestment Plan
II-5
<PAGE>
EXHIBIT 4
{LETTERHEAD OF COMMUNITY BANK SHARES OF INDIANA, INC.}
November 14, 1997
Dear Shareholder:
We are pleased to announce the availability of the Community Bank Shares of
Indiana, Inc. Dividend Reinvestment Plan. This Plan enables you to apply your
dividends on our common stock toward the purchase of additional shares of
Company common stock.
The Company will pay all brokerage commissions and administrative fees
connected with your participation in the Plan. This will ensure that the full
amount of your reinvested dividends will be applied to the purchase of
additional shares. However, if a Participant directs the Plan administrator to
sell his or her shares, or terminates his or her interest in the Plan, the
Participant will be charged an administrative fee incurred in connection with
the sale of such shares by the Plan administrator or the termination of a
Participant's interest in the Plan.
The Plan is a convenient and economical way for you to increase your
ownership of Company common stock. Participation in the Plan is entirely
voluntary, and you may enroll or withdraw at any time. If you do not enroll in
the Plan, you will continue to receive your regular dividend checks in the mail.
The enlcosed Prospectus and brochure include important details about your
Dividend Reinvestment Plan. Please read this information carefully to see if
the Plan is right for you.
The Plan is administered by Registrar and Transfer Company, the Company's
stock transfer agent. You may enroll in the Plan by having all registered
owners sign the enclosed Authorization Card and mailing it to Registrar and
Transfer Company in the enclosed prepaid envelope.
Sincerely,
Robert E. Yates
President and Chief Executive Officer
<PAGE>
Community Bank Shares of Indiana, Inc.
Dividend Reinvestment Plan
THE COMPANY
Community Bank Shares of Indiana, Inc. (the "Company") is an Indiana
corporation and the bank holding company for Community Bank of Southern Indiana
and Heritage Bank of Southern Indiana (the "Banks"). Community Bank of Southern
Indiana and Heritage Bank of Southern Indiana are state-chartered stock
commercial banks headquartered in New Albany, Indiana and Jeffersonville,
Indiana, respectively. The Banks are regulated by the Indiana Department of
Financial Institutions and the Federal Deposit of Insurance Corporation (the
"FDIC").
The offices of the Company are located at 202 East Spring Street, New
Albany, Indiana 47150. The telephone number of the Company is (812) 944-2224.
The Company publishes Annual Reports, Proxy Statements and other
periodic reports which are made available to its shareholders. All such reports
are hereby incorporated by reference into the description of the Company in this
Dividend Reinvestment Plan (the "Plan"). The Company will provide, without
charge, to each person to whom a copy of the Plan is delivered, on the oral or
written request of any such person, a copy of any or all of the foregoing
documents. Written requests for such copies should be made to Community Bank
Shares of Indiana, Inc., 202 East Spring Street, New Albany, Indiana 47150,
Attention: Pamela Echols.
THE PLAN
The Plan described in this brochure offers you the opportunity to
increase your investment in the Company's common stock, par value $.10 per
share (the "Common Stock"), with no brokerage commissions or administrative fees
of any kind. The Plan permits you to use all or a portion of your cash
dividends to purchase additional whole and fractional shares of Common Stock.
The Plan is administered by the Company's stock transfer agent, Registrar and
Transfer Company, 10 Commerce Drive, Cranford, New Jersey 07016 ("R&T").
INVESTMENT CONSIDERATIONS
The purchase price of stock purchased under the Plan is based upon the
market price of the Common Stock.
Shares of Common Stock purchased under the Plan are NOT deposit accounts of
the Banks and are NOT insured by Federal Deposit Insurance Corporation or any
other governmental organization. Shares of Common Stock are subject to market
risk and possible loss of investment.
<PAGE>
The Plan permits you to invest your Company cash dividends in additional
shares of Common Stock. Instead of sending all or a portion of your regular
dividend check to you, R&T will use your dividend to purchase whole and
fractional shares of Common Stock and credit them to your account. Dividends
on the shares credited to your account under the Plan will also be reinvested
for you, thereby compounding your investment. All shares purchased pursuant to
this Plan will be purchased either directly from the Company, in which case they
will be issued by the Company out of treasury shares or its legally authorized
but unissued shares of Common Stock, or on the open market at then current
market prices. The choice of whether shares will be purchased from the Company
or on the open market will be determined by the Company in its discretion, based
on the best interests on the Company.
The purchase price for shares of Common Stock purchased through the Plan
directly from the Company will be equal to the average market price of shares of
the Common Stock for the ten business days preceding the dividend payment date.
The purchase price for shares of Common Stock purchased through the Plan on the
open market will be R&T's actual purchase price.
The Company will pay all brokerage commissions and administrative fees
connected with your participation in the Plan. The only cost will be a
termination fee if you decide to withdraw from the Plan.
ACCOUNT STATEMENTS
You will receive an account statement from R&T each time that shares are
purchased for you under the Plan. The statement will show the total number of
whole and fractional shares in your account to date, as well as the amount of
the most recent dividend, the number of shares purchased and the price per
share. You should retain all account statements for your personal accounting
and record keeping purposes.
ELIGIBILITY
Participation in the Plan is limited to registered shareholders of record
of the Common Stock. Any shareholder whose common shares are registered in
names other than their own (i.e., the name of a brokerage firm, bank or
nominee) must become a shareholder of record by having their shares transferred
into their own name in order to participate in the Plan. Once you have become a
registered shareholder of record, you will be eligible to participate in the
Plan and may do so by completing an authorization card.
ENROLLMENT
To enroll in the Plan, just complete the enclosed authorization card and
return it to R&T in the enclosed envelope. On the card, you will indicate
whether you want all of your dividends reinvested in Common Stock or 25%, 50% or
75% of such dividends reinvested. If your signed authorization card is received
at least 10 business days before a dividend payment date, the Plan will go into
effect for you with that dividend. Otherwise, your
<PAGE>
participation will be deferred until the next dividend. Your participation in
the Plan will apply to all shares that are registered to you at time of
enrollment, plus all shares that you acquire while your authorization remains in
effect. If you sell all of your shares for which you have a certificate, but
your participation in the Plan is not terminated, dividends on the shares held
in your account under the Plan will continue to be reinvested.
TAXATION OF DIVIDENDS
You will be taxed on the dividends that are reinvested on your behalf, just
the same as you would have been if they had been paid directly to you. In
addition, the amount of any brokerage commissions and administrative fees paid
for you by the Company in connection with the purchase of shares, will be taxed
as income to you. At year-end R&T will send all applicable tax information to
you and to the Internal Revenue Service. If you have any remaining tax
questions, you should consult your personal tax advisor.
CERTIFICATES
Shares purchased for your account under the Plan will normally be held by
R&T, without charge. If you wish, however, a certificate or certificates for
whole shares credited to your account will be delivered to you upon your written
request to R&T. R&T will impose a certificate fee of $15 per request.
VOTING OF SHARES
You will be given the right to direct R&T to vote any whole shares (but not
fractional shares) held for you under the Plan on the record date for a vote.
Shares for which no voting directions are received will not be voted.
FRACTIONAL SHARES
While you are a participant in the Plan, the entire amount of your dividend
payment will be used to purchase shares of Common Stock. If the amount is not
equal to an exact number of whole shares, your account will be credited with a
fractional share (calculated to four decimal places). A fractional share will
earn dividends for you, in proportion to the size of the fraction just as full
shares do.
WITHDRAWAL FROM PLAN
You may terminate or change your level of participation in the Plan at any
time and for any reason. To withdraw from the Plan, simply give written notice
to R&T at least 10 business days before a dividend payment date. Your notice
should include a termination fee of $25. Upon termination, you will receive a
certificate for the number of whole shares credited to your account under the
Plan, plus a check for any fraction of a share, valued at the then current
market price of Common Stock.
<PAGE>
QUESTIONS AND CORRESPONDENCE
Please direct all questions and correspondence regarding the Plan to:
Registrar and Transfer Company
Dividend Reinvestment Plan
10 Commerce Drive
Cranford, NJ 07016
Telephone: 1-800-368-5948
Be sure to refer to Community Bank Shares of Indiana, Inc. or enclose the
top portion of your account statement with all correspondence.
<PAGE>
Terms and Conditions
Community Bank Shares of Indiana, Inc.
Dividend Reinvestment Plan
(a) Participation; Agent: The Plan is available to shareholders of record
of the Common Stock. R&T, acting as agent for each participant in the Plan,
will apply cash dividends which become payable to such participant on shares of
Common Stock (including shares held in the participant's name and shares
accumulated under the Plan), to the purchase of additional whole and fractional
shares of stock for such participant. Each participant shall direct whether all
or a specified percentage (25%, 50% or 75%) of his or her dividends will be
reinvested.
(b) Stock Purchases: In making purchases for the accounts of
participants, R&T may commingle the funds of one participant with those of other
participants in the Plan. In the case of each purchase, the price per share for
each participant's account for shares purchased with reinvested dividends shall
be the average price of all shares purchased during that dividend period, with
the price of each share determined in accordance with the Dividend Reinvestment
section hereof. At the discretion of the Company, purchases may be made
directly from the Company or on the open market, at such prices and on such
terms as R&T shall determine its discretion. R&T shall have no responsibility
with respect to the market value of the Common Stock acquired for participants
under the Plan.
(c) Timing Of Purchases: R&T will make every reasonable effort to invest
all dividends as promptly after receipt as possible. Participant's funds held
by R&T prior to purchase during this period will not bear interest. Investment
in the Common Stock will then be completed as soon as possible.
(d) Account Statements: Following each purchase of shares, R&T will mail
to each participant an account statement showing the cash dividends and optional
cash payments received, the number of shares purchased, the price per share, and
the participant's total shares accumulated under the Plan.
(e) Expenses: There will be no expenses to participants for the
administration of the Plan. Brokerage commissions and administrative fees
associated with the Plan, if any, will be paid by the Company.
(f) Taxation of Dividends: The reinvestment of dividends does not relieve
the participant of any taxes which may be payable on such dividends. In
addition, brokerage commissions and administrative fees paid by the Company, if
any, on behalf of the participant, may constitute additional income. Dividends
paid on accumulated shares, and the amount of brokerage commissions and
administrative fees paid by the Company on behalf of each participant, will be
included in an annual information return filed with the Internal Revenue
Service. A copy of the return will be sent to the participant, or the
<PAGE>
information included in the return will be shown on the participant's final
account statement for the year.
(g) Stock Certificates: No share certificates will be issued to a
participant unless the participant so requests or until the participant's
account is terminated. Such requests must be made in writing to R&T, and must
be accompanied by a check or money order in the amount of $15 in payment of the
certificate fee. No certificates for fractional shares will be issued.
(h) Voting of Shares: In connection with any matter requiring the vote of
shareholders of the Company, Plan participants shall be entitled to direct R&T
to vote all whole shares held on their account in the Plan. Fractional shares
will not be voted.
(i) Termination of Participation: A participant may terminate
participation in the Plan at any time by written instructions to R&T. Notice of
termination must be accompanied by a termination fee of $25. To be effective on
a dividend payment date, the Notice of Termination must be received by R&T at
least 10 business days before that dividend payment date. Upon receipt of
Notice of Termination from the participant, R&T will send to the participant a
certificate for all whole shares in the participant's account. Fractional shares
credited to the terminated account will be paid in cash at the then prevailing
market rate. R&T may also terminate any participants account at any time in its
discretion by notice in writing mailed to the participant.
(j) Stock Dividends, Stock Splits, Rights: Any stock dividends or stock
splits on the Common Stock applicable to shares belonging to a participant under
the Plan, whether held in the participant's account or in the participant's own
name, will be credited to the participant's account. In the event the Company
makes available to its shareholders rights to purchase additional shares or
securities, participants under the Plan will receive a subscription warrant for
all such rights directly from R&T.
(k) Limitation of Liability: Neither the Company nor R&T shall have any
responsibility beyond the exercise of ordinary care for any action taken or
omitted pursuant to this agreement; nor shall they have any duties,
responsibilities or liabilities except as are expressly set forth herein; nor
shall they be liable for any act done in good faith or for any good faith
omission to act; nor shall they have any liability in connection with an
inability to purchase shares or with respect to the timing or the price of any
purchase.
(l) Amendment of Plan: This agreement may be amended, supplemented or
terminated by the Company or R&T at any time by the delivery of written notice
to each participant at least 30 days prior to the effective date of the
amendment, supplement or termination. Any amendment or supplement shall be
deemed to be accepted by the participant unless, prior to its effective date,
R&T receives written Notice of Termination of the participant's account.
(m) Governing Law: This agreement and the authorization card signed by
the participant (which is deemed a part of this agreement) and the participant's
account shall
<PAGE>
be governed by and construed in accordance with the laws of the State of
Indiana. This agreement cannot be changed orally.
COMMUNITY BANK SHARES OF INDIANA, INC.
Dividend Reinvestment Plan
<PAGE>
EXHIBIT 5
Law Offices
ELIAS, MATZ, TIERNAN & HERRICK L.L.P.
12th Floor
734 15th Street, N.W.
Washington, D.C. 20005
Telephone (202) 347-0300
November 14, 1997
Board of Directors
Community Bank Shares of Indiana, Inc.
202 East Spring Street
New Albany, Indiana 47150
Re: Registration Statement on Form S-3
Gentlemen:
We are special counsel to Community Bank Shares of Indiana, Inc., an
Indiana corporation (the "Corporation"), in connection with the preparation and
filing with the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended (the "Act"), of a Registration Statement on Form S-3
(the "Registration Statement"), relating to the registration of up to 100,000
shares of common stock, par value $0.10 per share ("Common Stock"), to be issued
pursuant to the Corporation's Dividend Reinvestment Plan (the "Plan"). We have
been requested by the Corporation to furnish an opinion to be included as an
exhibit to the Registration Statement.
For this purpose, we have reviewed the Registration Statement and related
Prospectus, the Articles of Incorporation and Bylaws of the Corporation, the
Plan, a specimen stock certificate evidencing the Common Stock of the
Corporation and such other corporate records and documents as we have deemed
appropriate. We are relying upon the originals, or copies certified or
otherwise identified to our satisfaction, of the corporate records of the
Corporation and such other instruments, certificates and representations of
public officials, officers and representatives of the Corporation as we have
deemed relevant as a basis for this opinion. In addition, we have assumed,
without independent verification, the genuineness of all signatures and the
authenticity of all documents furnished to us and the conformance in all
respects of copies to originals. Furthermore, we have made such factual
inquiries and reviewed such laws as we determined to be relevant for this
opinion.
<PAGE>
Board of Directors
November 14, 1997
Page 2
Based on the foregoing, and subject to the assumptions set forth herein,
we are of the opinion as of the date hereof that the shares of Common Stock to
be issued pursuant to the Plan, when issued and sold pursuant to the Plan and
upon receipt of the consideration required thereby, will be legally issued,
fully paid and non-assessable shares of Common Stock of the Corporation.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Legal
Opinion" in the Prospectus. In giving such consent, we do not thereby admit
that we are in the category of persons whose consent is required under Section 7
of the Act.
Very truly yours,
ELIAS, MATZ, TIERNAN & HERRICK L.L.P
By: /s/ Kenneth B. Tabach
--------------------------
Kenneth B. Tabach, a Partner
<PAGE>
EXHIBIT 23.1
Consent of Independent Public Accountants
The Board of Directors
Community Bank Shares of Indiana, Inc.
We consent to the use of our report dated January 31, 1997, incorporated by
reference herein, relating to the consolidated balance sheets of Community Bank
Shares of Indiana, Inc. and subsidiaries as of December 31, 1996 and 1995, and
the related consolidated statements of income, changes in shareholders' equity,
and cash flows for each of the years in the three-year period ended December 31,
1996 and to the reference to our firm under the heading "Experts" in the
Prospectus contained in the Company's Registration Statement on Form S-3.
/s/ Monroe Shine & Co.
New Albany, Indiana
November 13, 1997
<PAGE>
Exhibit 99
Community Bank Shares of Indiana, Inc.
Authorization for Dividend Reinvestment Plan
Please enroll me in the Community Bank Shares of Indiana, Inc. Dividend
Reinvestment Plan as indicated below.
1. / / Full Dividend Reinvestment --
Please apply dividends on all
shares of Community Bank Shares of
Indiana, Inc. common stock held in
my account to the purchase of
additional shares of Community
Bank Shares of Indiana, Inc.
common stock.
2. / / Partial Dividend Reinvestment
-- Please apply dividends on
_________ (specify either 25%, 50%
or 75%) of my shares of Community
Bank Shares of Indiana, Inc.
common stock registered in my name
to the purchase of additional
shares of Community Bank Shares of
Indiana, Inc. common stock.
Please print
Name:
-------------------------
Social Security Number:
- -
-------------------------
Address:
-------------------------
-------------------------
All persons whose Names Appear on the
Certificate Must Sign.
- ------------------------------------------
Stockholder's Signature Date
- ------------------------------------------
Stockholder's Signature Date
