EXHIBIT 10(A)
COMMERCE BANCSHARES, INC.
EXECUTIVE INCENTIVE COMPENSATION PLAN
AMENDMENT AND RESTATEMENT AS OF DECEMBER 31, 1999
1. PURPOSE
The policy of Commerce Bancshares, Inc. ("Commerce") is to
compensate its officers based on performance. The purpose of
this Executive Incentive Compensation Plan ("Plan") is to provide
incentive compensation awards to those individuals whose
management efforts reflect a desire to meet commonly agreed upon
objectives or to those who by their superior performance directly
contribute to the profitability of Commerce and to encourage the
retention of outstanding contributors.
2. ADMINISTRATION
The Plan shall be administered by the Compensation and
Benefits Committee of the Board of Directors ("Board") of
Commerce, which shall consist solely of two or more directors who
are "non-employee directors" under Rule 16b-3(b)(3) promulgated
under the Securities Exchange Act of 1934, as amended, or any
successor provision thereto. The Committee shall have authority
in its sole discretion to interpret the Plan, establish rules and
procedures thereunder, and make all determinations, including the
determination of incentive compensation awards eligible to be
deferred under the Plan. All determinations made by the
Committee shall be final and binding.
3. ELIGIBLE PARTICIPANTS
All chief executive officers, Chairmen of the Board,
Presidents, and Vice Presidents of Commerce or any of its
affiliated banks or subsidiary companies shall be eligible to
participate in the Plan, together with such other officers of
Commerce and its affiliated banks and subsidiary companies as the
Committee shall determine. Directors who are not officers or
employees of Commerce, an affiliated bank, or a subsidiary
company, are not eligible to participate in the Plan.
4. DETERMINATION OF AWARD
The Board of Commerce shall at its sole discretion approve
the amount of the aggregate incentive compensation awards to be
granted based on the recommendations of the Committee. Incentive
compensation awards made under this Plan shall be determined with
reference to performance during the preceding year. The
incentive compensation awards to be made to the Chairman of the
Board, President and/or Chief Executive Officer of Commerce shall
be determined by the Committee and all other awards to be made
under this Plan may be determined by the Committee or, should the
Committee so direct, by a committee consisting of the Chief
Executive Officer, a Vice Chairman designated by the Chief
Executive Officer, and the chief human resources officer.
5. PAYMENT OF INCENTIVE AWARD
Incentive compensation awards are generally determined and
made on or before the date of the annual meeting of shareholders
of Commerce. The normal method of payment will be in the form of
cash and awards will be paid as soon as practicable after the
awards are determined; provided, that the recipient of an award
shall not have elected to defer receipt of the incentive
compensation award as hereinafter provided.
6. DEFERRAL OPTIONS
a. Eligible employees who are members of a select group of
management or highly compensated employees, as selected
by the Commerce Director of Human Resources in his or
her discretion, may elect to defer all or a portion of
an incentive compensation award until the earlier to
occur of retirement, death, or termination. A deferral
must be expressed either as "all" or as a specified
dollar amount. Any incentive compensation award above
the specified amount will be paid in cash, and if the
award is less than the amount deferred, the total award
will be deferred. The granting of an incentive
compensation award is discretionary and neither
delivery of deferral election materials nor an election
to defer shall affect entitlement to such an award.
All deferral elections made under the Plan are
irrevocable. It is intended that this arrangement
qualify as, and shall be administered to qualify as
being unfunded and being primarily for the purpose of
providing deferred compensation for a select group of
management or highly compensated employees.
b. In order to ensure that elections to defer
incentive compensation awards are effective under
applicable tax laws, all persons eligible to
participate in this Plan will be given the
opportunity to defer payment of all or a portion of
an incentive compensation award. An election to
defer must be made in a written form satisfactory
to Commerce and must be received by the Commerce
Director of Human Resources on or before the last
business day of the year preceding the year for
which performance is measured to determine the
granting of an incentive compensation award
c. An eligible employee in electing a deferred payment
shall also elect the accounts, from among the accounts
that Commerce makes available to the participating
employee, to which the relevant portion of the award
deferral will be credited. Credits to available
accounts for deferral of an incentive compensation
award shall be determined from time to time based upon
hypothetical measuring investments (the "Measuring
Investments") for each account; one of which shall
consist of a Company Stock Account and there shall be
such other accounts determined from time to time by the
Director of Human Resources in his or her discretion.
Such accounts are bookkeeping accounts only and are
maintained for the sole purpose of determining the
amount payable by Commerce to the eligible employee
based upon the hypothetical performance of the
Measuring Investments for each such account, determined
as if the account had assets invested in the Measuring
Investments for such account. No assets shall be
segregated for the
benefit of an eligible employee and the bookkeeping
account shall not represent assets set aside for the
benefit of an eligible employee.
With the exception of the Commerce Stock Account,
an eligible employee may elect to transfer credits
between accounts, and the amount credited to all
such accounts shall be determined from time to
time, all pursuant to non-discriminatory rules,
procedures and deadlines set by the Commerce
Director of Human Resources, which rules,
procedures, and deadlines may be amended from time
to time in such officer's discretion (the
"Administrative Rules"). Except as set forth in
the following paragraph, however, an eligible
employee may elect to transfer credits into the
Commerce Stock Account, but not out of the
Commerce Stock Account. Any election to transfer
a credit to the Commerce Stock Account or among
the other accounts (a "Transfer Election") must be
received by the Commerce Director of Human
Resources by the date set by the Commerce Director
of Human Resources and must be in a written form
satisfactory to such officer, in each case
pursuant to the Administrative Rules. Any
transfer to the Commerce Stock Account shall be
based upon the last sale price of Commerce Stock
as reported by the National Association of
Security Dealers National Market System on the
trading day determined in accordance with the
Administrative Rules. The credit transferred from
any other account shall be based upon the amount
credited to such account as of the date determined
in accordance with the Administrative Rules.
Notwithstanding the above, an eligible employee
may make a one-time election to remove any or all
amounts out of the Commerce Stock Account (a
"Diversification Election") as of February 17,
2000. Such Diversification Election must be made
at the time and in the manner determined pursuant
to the Administrative Rules. Any transfer from
the Commerce Stock Account shall be based upon the
last sale price of Commerce Stock as reported by
the National Association of Security Dealers
National Market System on the trading day
determined in accordance with the Administrative
Rules. The amount transferred from the Commerce
Stock Account pursuant to the Diversification
Election shall be based upon the number of units
credited to such account as of the date determined
in accordance with the Administrative Rules.
d. The accounts made available for the deferral of incentive
compensation awards are bookkeeping accounts. The amount
credited to each account, including any hypothetical earnings,
gains or losses, will be determined in accordance with the
Administrative Rules, based on the investment performance of the
Measuring Investments for such Account. The timing and manner of
making credits or debits to each account shall be determined in
accordance with the Administrative Rules.
e. Commerce shall provide periodically to each participant
(but not less frequently than once per calendar year) a
statement setting forth the balance to the credit of
such participant in each of the accounts.
f. Amounts deferred under the provisions of this Plan will
be disbursed to participants in accordance with the
following:
(1) An amount equal to the amounts credited to
accounts other than the Commerce Stock Account
will be paid by Commerce in a single distribution
as soon as reasonably practicable after
retirement, disability, death or other termination
of employment, except that a participant may elect
to instead have payment made in up to ten annual
equal installments or in such installments after
receiving a lump sum payment of a portion of the
payment due. Annual installments will be paid in
an amount, less applicable withholding taxes,
determined by multiplying the balance in the
Discretionary Account by a fraction, the numerator
of which is one (1) and the denominator of which
is a number equal to remaining unpaid annual
installments.
(2) If a participant dies after the commencement of
payments from such participant's accounts other
than the Commerce Stock Account, the designated
beneficiary shall receive the remaining
installments over the elected installment period.
(3) With respect to a participant's Commerce Stock
Account, upon such participant's disability,
death, retirement, or other termination of
employment, Commerce shall transfer to such
participant a number of shares of Commerce stock,
and cash for any fractional shares, equal to the
units credited to the participant's Commerce Stock
Account. No payment, however, shall be made with
respect to the Commerce Stock Account until
arrangements satisfactory to Commerce shall have
been made to provide for payment to Commerce of
federal, state, local, and payroll withholding
taxes attributable to such payment.
(4) Each participant shall have the right at any time
to designate any person or persons as beneficiary
or beneficiaries (both principal as well as
contingent) to whom payment under this Plan shall
be made in the event of death prior to complete
distribution to the participant of the amounts due
under this Plan. Any beneficiary designation may
be changed by a participant by the filing of such
change in writing on a form prescribed by
Commerce. The filing of a new beneficiary
designation form will cancel all beneficiary
designations previously filed and will apply to
all deferrals in the account. If a beneficiary
has not been designated or if all designated
beneficiaries predecease the participant, then any
amounts payable to the beneficiary shall be paid
to the participant's estate in one lump sum.
(5) If there is any change in the number or class of
shares of Commerce stock through the declaration
of stock dividend or other extraordinary dividends
or recapitalization resulting in stock splits or
combinations or exchanges of such shares or in the
event of similar corporate transactions, each
participant's Commerce Stock Account shall be
equitably adjusted to
reflect any such change in the number or class of
issued shares of common stock of Commerce or to
reflect such similar corporate transaction.
(6) The Human Resources/Salary Committee of Commerce,
upon 30 days written notice, may approve a
"hardship" request for distribution of a deferred
award. Unless the participant presents proof
satisfactory to such committee of financial need,
requests for hardship distribution will be denied.
Each request will be evaluated on the basis of
uniformly applied criteria.
7. AMENDMENT AND TERMINATION OF PLAN
The Board of Directors may at its discretion and at any time
amend the Plan in whole or in part. The Committee may terminate
the Plan in its entirety at any time, and, upon such termination
or such later date or dates, each participant shall: receive, in
a single distribution, the shares and cash for the fractions
thereof of Commerce Stock credited to the Commerce Stock Account;
and shall be paid, in a single distribution or over such period
of time as determined by the Committee, an amount equal to the
then remaining amount credited to such participant's accounts
other than the Commerce Stock Account.
8. MISCELLANEOUS
a. A participant under this Plan is merely a general unsecured
creditor and nothing contained in this Plan shall create a trust
of any kind or a fiduciary relationship between Commerce and the
participant or the participant's estate. Nothing contained
herein shall be construed as conferring upon the participant the
right to continued employment with Commerce or its subsidiaries
or to an incentive compensation award. Except as otherwise
provided by applicable law, benefits payable under this Plan may
not be assigned or hypothecated, and no such benefits shall be
subject to legal process or attachment for the payment of any
claim of any person entitled to receive the same.
b. The amendment of the Plan to allow a Commerce Stock deferral
option shall become effective on the date the shareholders of
Commerce approve the same. Subject to such approval, an employee
having a deferred option may elect (but prior to June 30, 1994)
to transfer his balance in the Treasury Bill Account and/or the
Treasury Note Account as of April 1, 1994 to the Commerce Stock
Account with the number of units credited to his account
determined as provided in Section 6d hereof but based on the last
sale price as of the last day in March 1994 on which a trade of
Commerce Stock is reported. An employee who in 1993 deferred a
potential incentive compensation award with respect to
performance in 1994 and elected either a Treasury Bill Account or
a Treasury Note Account may elect prior to June 30, 1994 to defer
such award for 1994 to the Common Stock Account.
c. Notwithstanding any other provision herein, Commerce may
establish a trust subject to the claims of the general creditors
of Commerce (a "rabbi trust") and
deposit amounts into the rabbi trust. Although any payments
from the rabbi trust to a participant shall discharge Commerce's
obligation to the extent of payment made, this plan is unfunded
and no participant shall have an interest in any rabbi trust asset.