Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the registrant [X]
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 Rule 14a-11(c) or Rule 14a-12
PFSB Bancorp, Inc.
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(Name of Registrant as Specified in Its Charter)
PFSB Bancorp, Inc.
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(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] $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:
N/A
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(2) Aggregate number of securities to which transactions applies:
N/A
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
N/A
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(4) Proposed maximum aggregate value of transaction:
N/A
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[ ] 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:
N/A
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(2) Form, schedule or registration statement no.:
N/A
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(3) Filing party:
N/A
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(4) Date filed:
N/A
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December 15, 1999
Dear Stockholder:
You are cordially invited to attend the first annual meeting of
stockholders of PFSB Bancorp, Inc. The meeting will be held at the main office
of Palmyra Savings, 123 West Lafayette Street, Palmyra, Missouri on Thursday,
January 27, 2000 at 2:00 p.m., local time.
The notice of annual meeting and proxy statement appearing on the following
pages describe the formal business to be transacted at the meeting. During the
meeting, we will also report on the operations of the Company. Directors and
officers of the Company, as well as a representative of Moore, Horton & Carlson,
P.C., the Company's independent auditors, will be present to respond to
appropriate questions of stockholders.
It is important that your shares are represented at this meeting, whether
or not you attend the meeting in person and regardless of the number of shares
you own. To make sure your shares are represented, we urge you to complete and
mail the enclosed proxy card. If you attend the meeting, you may vote in person
even if you have previously mailed a proxy card.
We look forward to seeing you at the meeting.
Sincerely,
/s/ Eldon R. Mette
Eldon R. Mette
President and Chief Executive Officer
PFSB BANCORP, INC.
123 West Lafayette Street
Palmyra, Missouri 63461
(573) 769-2134
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held On January 27, 2000
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NOTICE IS HEREBY GIVEN that the first annual meeting of stockholders of
PFSB Bancorp, Inc. ("Company") will be held at the main office of Palmyra
Savings, 123 West Lafayette Street, Palmyra, Missouri on Thursday, January 27,
2000 at 2:00 p.m., local time, for the following purposes:
1. To elect two directors to serve for a term of one year, two directors
to serve for a term of two years and three directors to serve for a
term of three years;
2. To consider and vote upon a proposal to approve the PFSB Bancorp, Inc.
2000 Stock-Based Incentive Plan;
3. To ratify the appointment of Moore, Horton & Carlson, P.C. as
independent auditors for the Company for the fiscal year ending
September 30, 2000; and
4. To transact any other business that may properly come before the
meeting.
NOTE: The Board of Directors is not aware of any other business to come
before the meeting.
Stockholders of record at the close of business on December 1, 1999 are
entitled to receive notice of the meeting and to vote at the meeting and any
adjournment or postponement of the meeting.
Please complete and sign the enclosed form of proxy, which is solicited by
the Board of Directors, and mail it promptly in the enclosed envelope. The proxy
will not be used if you attend the meeting and vote in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Ronald L. Nelson
Ronald L. Nelson
Corporate Secretary
Palmyra, Missouri
December 15, 1999
IMPORTANT: The prompt return of proxies will save the Company the expense of
further requests for proxies in order to ensure a quorum. A self-addressed
envelope is enclosed for your convenience. No postage is required if mailed in
the United States.
PROXY STATEMENT
OF
PFSB BANCORP, INC.
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ANNUAL MEETING OF STOCKHOLDERS
January 27, 2000
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This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of PFSB Bancorp, Inc. ("PFSB Bancorp" or the
"Company") to be used at the first annual meeting of stockholders of the
Company. The Company is the holding company for Palmyra Savings ("Palmyra
Savings"). The annual meeting will be held at the main office of Palmyra
Savings, 123 West Lafayette Street, Palmyra, Missouri on Thursday, January 27,
2000 at 2:00 p.m., local time. This proxy statement and the enclosed proxy card
are being first mailed to stockholders on or about December 15, 1999.
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VOTING AND PROXY PROCEDURE
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Who Can Vote at the Meeting
You are entitled to vote your PFSB Bancorp common stock if the records of
the Company show that you held your shares as of the close of business on
December 1, 1999. As of the close of business on that date, a total of 475,150
shares of PFSB Bancorp common stock were outstanding. Each share of common
stock has one vote. As provided in the Company's Articles of Incorporation,
record holders of the Company's common stock who beneficially own, either
directly or indirectly, in excess of 10% of the Company's outstanding shares are
not entitled to any vote in respect of the shares held in excess of the 10%
limit.
Attending the Meeting
If you are a beneficial owner of PFSB Bancorp common stock held by a
broker, bank or other nominee (i.e., in "street name"), you will need proof of
ownership to be admitted to the meeting. A recent brokerage statement or letter
from a bank or broker are examples of proof of ownership. If you want to vote
your shares of PFSB Bancorp common stock held in street name in person at the
meeting, you will have to get a written proxy in your name from the broker, bank
or other nominee who holds your shares.
Vote Required
The annual meeting will be held if a majority of the outstanding shares of
common stock entitled to vote is represented at the meeting. If you return
valid proxy instructions or attend the meeting in person, your shares will be
counted for purposes of determining whether there is a quorum, even if you
abstain from voting. Broker non-votes also will be counted for purposes for
determining the existence of a quorum. A broker non-vote occurs when a broker,
bank or other nominee holding shares for a beneficial owner does not vote on a
particular proposal because the nominee does not have discretionary voting power
with respect to that item and has not received voting instructions from the
beneficial owner.
In voting on the election of directors, you may vote in favor of all
nominees, withhold votes as to all nominees, or withhold votes as to specific
nominees. There is no cumulative voting for the election of
directors. Directors must be elected by a plurality of the votes cast at the
annual meeting. This means that the nominees receiving the greatest number of
votes will be elected. Votes that are withheld and broker non-votes will have no
effect on the outcome of the election. In voting on the approval of the PFSB
Bancorp, Inc. 2000 Stock-Based Incentive Plan and the ratification of the
appointment of Moore, Horton & Carlson, P.C. as independent auditors, you may
vote in favor of the proposal, vote against the proposal or abstain from voting.
These matters will be decided by the affirmative vote of a majority of the votes
cast at the annual meeting. On these two matters, abstentions and broker non-
votes will have no effect on the voting.
Voting by Proxy
This proxy statement is being sent to you by the Board of Directors of PFSB
Bancorp for the purpose of requesting that you allow your shares of PFSB Bancorp
common stock to be represented at the annual meeting by the persons named in the
enclosed proxy card. All shares of PFSB Bancorp common stock represented at the
annual meeting by properly executed proxies will be voted according to the
instructions indicated on the proxy card. If you sign, date and return a proxy
card without giving voting instructions, your shares will be voted as
recommended by the Company's Board of Directors. The Board of Directors
recommends a vote FOR each of the nominees for director, FOR approval of the
PFSB Bancorp, Inc. 2000 Stock-Based Incentive Plan and FOR ratification of
Moore, Horton & Carlson, P.C. as independent auditors.
If any matters not described in this proxy statement are properly presented
at the annual meeting, the persons named in the proxy card will use their own
judgment to determine how to vote your shares. This includes a motion to adjourn
or postpone the annual meeting in order to solicit additional proxies. If the
annual meeting is postponed or adjourned, your PFSB Bancorp common stock may be
voted by the persons named in the proxy card on the new annual meeting date as
well, unless you have revoked your proxy. The Company does not know of any
other matters to be presented at the annual meeting.
You may revoke your proxy at any time before the vote is taken at the
meeting. To revoke your proxy you must either advise the Secretary of the
Company in writing before your common stock has been voted at the annual
meeting, deliver a later dated proxy, or attend the meeting and vote your shares
in person. Attendance at the annual meeting will not in itself constitute
revocation of your proxy.
If your PFSB Bancorp common stock is held in street name, you will receive
instructions from your broker, bank or other nominee that you must follow in
order to have your shares voted. Your broker or bank may allow you to deliver
your voting instructions via the telephone or the Internet. Please see the
instruction form provided by your broker, bank or other nominee that accompanies
this proxy statement.
Participants in Palmyra Saving's ESOP or 401(k) Plan
If you participate in the Palmyra Savings Employee Stock Ownership Plan or
if you hold shares through Palmyra Savings' 401(k) Plan, the proxy card
represents a voting instruction to the trustees of the ESOP and the 401(k) Plan,
respectively. Each participant in the ESOP and the 401(k) Plan may direct the
trustees as to the manner in which shares of PFSB Bancorp common stock allocated
to the participant's plan account are to be voted. Unallocated shares of common
stock held by the ESOP and allocated shares for which no timely voting
instructions are received will be voted by the ESOP trustees in the same
proportion as shares for which the trustees have received voting instructions,
subject to the exercise of their fiduciary duties. Although no shares have been
allocated to participants' accounts as of December 1, 1999, the ESOP provides
that, before the initial allocation, each participant is deemed to have one
share for purposes of providing voting instructions to the ESOP trustees.
2
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STOCK OWNERSHIP
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The following table provides information as of December 1, 1999 with
respect to persons known to the Company to be the beneficial owners of more than
5% of the Company's outstanding common stock. A person may be considered to
beneficially own any shares of common stock over which he or she has, directly
or indirectly, sole or shared voting or investing power.
Percent of
Number of Common Stock
Name and Address Shares Owned Outstanding
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Palmyra Savings 44,720/(1)/ 9.4%
Employee Stock Ownership Plan
123 West Lafayette Street
Palmyra, Missouri 63461
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(1) Under the terms of the ESOP, the trustees will vote unallocated shares and
allocated shares for which no timely voting instructions are received in the
same proportion as shares for which the trustees have received voting
instructions from participants. As of December 1, 1999, no shares have been
allocated to participants' accounts. However, the ESOP provides that,
before the initial allocation, each participant is deemed to have one share
for purposes of providing voting instructions to the trustees. The trustees
of the ESOP are L. Edward Schaeffer, Eldon R. Mette and Ronald L. Nelson.
The following table provides information about the shares of Company common
stock that may be considered to be beneficially owned by each nominee for
director of the Company and by all directors and executive officers of the
Company as a group as of December 1, 1999. Unless otherwise indicated, each of
the named individuals has sole voting power and sole investment power with
respect to the number of shares shown.
Number of Percent of Common
Name Shares Owned Stock Outstanding
------------------- ------------------- ----------------------------
L. Edward Schaeffer 5,000/(1)/ *
Glen J. Maddox 5,000 *
Eldon R. Mette 5,039/(2)/ 1.0
Albert E. Davis 10,000/(3)/ 1.8
Robert M. Dearing 4,000 *
James D. Lovegreen 4,000 *
Donald L. Slavin 7,500/(4)/ 1.3
All directors and
executive officers as
a group (8 persons) 42,623 7.9
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*Less than 1% of shares outstanding.
(1) Includes 1,000 shares owned by Mr. Schaeffer's spouse. Does not include
44,720 shares held by Palmyra Savings' ESOP, for which Mr. Schaeffer serves
as a trustee.
(2) Includes 25 shares owned by Mr. Mette's son. Does not include 44,720
shares held by Palmyra Savings' ESOP, for which Mr. Mette serves as a
trustee.
(3) Includes 3,000 shares owned by Mr. Davis' spouse.
(4) Includes 3,750 shares owned by Mr. Slavin's spouse.
3
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PROPOSAL 1 -- ELECTION OF DIRECTORS
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The Company's Board of Directors consists of seven members. Six directors
are independent and one is a member of management. The Board is divided into
three classes with three-year staggered terms, with approximately one-third of
the directors elected each year. As required by Missouri law, all seven
directors will be elected at the annual meeting to serve for either a one, two
or three-year term, or until their respective successors have been elected and
qualified. The nominees for election to serve for a one-year term, or until
their respective successors have been elected and qualified, are L. Edward
Schaeffer and Robert M. Dearing. The nominees for election to serve for a two-
year term, or until their respective successors have been elected and qualified,
are Glenn J. Maddox and Albert E. Davis. The nominees for election to serve for
a three-year term, or until their respective successors have been elected and
qualified, are James D. Lovegreen, Eldon R. Mette and Donald L. Slavin. All of
the nominees are currently directors of the Company and Palmyra Savings.
It is intended that the proxies solicited by the Board of Directors will be
voted for the election of the nominees named above. If any nominee is unable to
serve, the persons named in the proxy card would vote your shares to approve the
election of any substitute proposed by the Board of Directors. Alternatively,
the Board of Directors may adopt a resolution to reduce the size of the Board.
At this time, the Board of Directors knows of no reason why any nominee might be
unable to serve.
The Board of Directors recommends a vote "FOR" the election of all of the
nominees.
Information regarding the nominees for election at the annual meeting is
provided below. Unless otherwise stated, each nominee has held his current
occupation for the last five years. The age indicated in each nominee's
biography is as of September 30, 1999. The indicated period for service as a
director includes service as a director of Palmyra Savings.
L. Edward Schaeffer is a blacksmith. Age 69. Director since 1964.
Eldon R. Mette has been employed with Palmyra Saving since 1969. Before
becoming President of the Bank in January 1999, he served as Executive Vice
President since September 1969. Age 62. Director since 1988.
Glenn J. Maddox is a retired supermarket proprietor. Age 73. Director
since 1978.
Albert E. Davis is a retired manufacturing firm executive. Age 63.
Director since 1990.
Robert M. Dearing is a farmer and stockman. Age 50. Director since 1977.
James D. Lovegreen owns an automobile dealership. Age 66. Director since
1971.
Donald L. Slavin is a retired Chief Engineer of an electric utility.
Age 73. Director since 1962.
4
Meetings and Committees of the Board of Directors
The business of the Company and Palmyra Savings is conducted through
meetings and activities of their Boards of Directors and their committees.
During the fiscal year ended September 30, 1999, the Board of Directors of the
Company held five meetings and the Board of Directors of the Bank held 26
meetings. No director attended fewer than 75% of the total meetings of the
Boards of Directors and committees on which such director served.
The Audit Committee, consisting of the entire Board of Directors, receives
and reviews all reports prepared by the Company's independent auditors. The
Audit Committee met once during the fiscal year ended September 30, 1999.
The Compensation Committee, consisting of the entire Board of Directors, is
responsible for setting the salaries of all employees. The Compensation
Committee met once during the fiscal year ended September 30, 1999.
The Nominating Committee, consisting of the entire Board of Directors,
considers and recommends the nominees for director to stand for election at the
Company's annual meeting of shareholders. The Nominating Committee met once
during the fiscal year ended September 30, 1999.
Directors' Compensation
Directors of Palmyra Savings, other than the Chairman of the Board of
Palmyra Savings, receive a monthly fee of $265 plus $200 per meeting attended.
The Chairman of the Board receives a monthly fee of $265 plus $210 per meeting
attended. No separate fees are paid for service on the Company's Board of
Directors.
5
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EXECUTIVE COMPENSATION
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Summary Compensation Table
The following information is furnished for Mr. Mette. No executive officer
of PFSB Bancorp or Palmyra Savings received salary and bonus of $100,000 or more
during the year ended September 30, 1999.
Annual Compensation (1)
-----------------------------------
Other
Annual All Other
Name and Position Year Salary Bonus Compensation Compensation
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Eldon R. Mette 1999 $76,688 $3,294 $12,472(2) $6,781(3)
President and Chief 1998 74,450 3,572 13,129 6,087
Executive Officer
__________________________________
(1) Compensation information for 1997 has been omitted because PFSB Bancorp was
not a public company nor a subsidiary of a public company at that time.
(2) Consists of directors fees of $8,300 and appraisal fees of $4,172. Does not
include the aggregate amount of perquisites and other personal benefits,
which was less than 10% of the total annual salary and bonus reported.
(3) Consists of employer 401(k) contributions of $1,534, employer paid medical
insurance premiums of $4,584, employer paid disability insurance premiums of
$535, employer paid term life insurance premiums of $15 and travel expenses
of $113.
Employment Agreement
Effective March 31, 1999, PFSB Bancorp and Palmyra Savings entered into a
three-year employment agreement with Mr. Mette. Under the employment agreement,
the initial salary level for Mr. Mette is $77,250, which amount is paid by
Palmyra Savings and may be increased at the discretion of the Board of Directors
or an authorized committee of the Board. On the anniversary of the commencement
date of the employment agreement, the term may be extended for an additional
year at the discretion of the Board. The agreement is terminable by the
employers at any time, by Mr. Mette if he is assigned duties inconsistent with
his initial position, duties, responsibilities and status, or upon the
occurrence of certain events specified by federal regulations. If Mr. Mette's
employment is terminated without cause or upon his voluntary termination
following the occurrence of an event described in the preceding sentence,
Palmyra Savings would be required to honor the terms of the agreement through
the expiration of the current term, including payment of current cash
compensation and continuation of employee benefits.
The employment agreement also provides for a severance payment and other
benefits in the event of involuntary termination of employment in connection
with any change in control of PFSB Bancorp or Palmyra Savings. A severance
payment also will be provided on a similar basis in connection with a voluntary
termination of employment where, after a change in control, Mr. Mette is
assigned duties inconsistent with his position, duties, responsibilities and
status immediately before a change in control.
6
The maximum present value of the severance benefits under the employment
agreement is 2.99 times Mr. Mette's average annual compensation during the five-
year period preceding the effective date of the change in control (the "base
amount"). The employment agreement provides that the value of the maximum
benefit may be distributed, at the executive's election, in the form of a lump
sum cash payment equal to 2.99 times the executive's base amount or a
combination of a cash payment and continued coverage under Palmyra Savings'
health, life and disability programs for a 36-month period following the change
in control, the total value of which does not exceed 2.99 times the executive's
base amount. Section 280G of the Internal Revenue Code provides that severance
payments that equal or exceed three times the individual's base amount are
deemed to be "excess parachute payments" if they are contingent upon a change in
control. Individuals receiving excess parachute payments are subject to a 20%
excise tax on the amount of any excess parachute payments, and the Company
would not be entitled to deduct the amount of such excess payments.
The employment agreement restricts Mr. Mette's right to compete against
PFSB Bancorp and Palmyra Savings for a period of one year from the date of
termination of the agreement if he voluntarily terminates employment, except in
the event of a change in control.
PFSB Bancorp and Palmyra Savings have also entered into an employment
agreement with another senior officer of the Company and the Bank on
substantially similar terms.
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
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Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who own more than 10% of any
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Executive officers, directors and greater than 10% stockholders are required by
regulation to furnish the Company with copies of all Section 16(a) reports they
file.
Based solely on its review of the copies of the reports it has received and
written representations provided to the Company from the individuals required to
file the reports, the Company believes that each of its executive officers and
directors has complied with applicable reporting requirements for transactions
in PFSB Bancorp common stock during the fiscal year ended September 30, 1999.
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TRANSACTIONS WITH MANAGEMENT
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Federal regulations require that all loans or extensions of credit to
executive officers and directors of insured financial institutions must be made
on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons,
except for loans made pursuant to programs generally available to all employees,
and must not involve more than the normal risk of repayment or present other
unfavorable features. Palmyra Savings, therefore, is prohibited from making any
new loans or extensions of credit to executive officers and directors at
different rates or terms than those offered to the general public, except for
loans made under programs generally available to all employees, and Palmyra
Savings has adopted a policy to this effect. In addition, loans made to a
director or executive officer in an amount that, when aggregated with the amount
of all other loans to such person
7
and his or her related interests, are in excess of the greater of $25,000 or 5%
of the institution's capital and surplus (up to a maximum of $500,000) must be
approved in advance by a majority of the disinterested members of the Board of
Directors. The aggregate amount of loans by Palmyra Savings to its executive
officers and directors was approximately $56,000 at September 30, 1999.
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PROPOSAL 2 -- RATIFICATION OF 2000 STOCK-BASED INCENTIVE PLAN
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The Board of Directors of the Company is presenting for stockholder
approval the PFSB Bancorp, Inc. 2000 Stock-Based Incentive Plan (the "Incentive
Plan"), in the form attached to this proxy statement as Appendix A. The purpose
of the Incentive Plan is to attract and retain qualified personnel in key
positions, provide officers, employees and non-employee directors of the Company
and Palmyra Savings, with a proprietary interest in the Company as an incentive
to contribute to the success of the Company, promote the attention of management
to other stockholder's concerns, and reward employees for outstanding
performance. The following is a summary of the material terms of the Incentive
Plan which is qualified in its entirety by the complete provisions of the
Incentive Plan attached to this proxy statement as Appendix A.
General
The Incentive Plan authorizes the granting of options to purchase common
stock of the Company and awards of restricted shares of common stock. Subject
to certain adjustments to prevent dilution of awards to participants, the number
of shares of common stock reserved for awards under the Incentive Plan is 78,260
shares, consisting of 55,900 shares reserved for options and 22,360 shares
reserved for restricted stock awards. All employees and non-employee directors
of the Company and its affiliates are eligible to receive awards under the
Incentive Plan. The Incentive Plan will be administered by a committee (the
"Committee") consisting of members of the Board of Directors who are not
employees of the Company or its affiliates. Authorized but unissued shares or
shares previously issued and reacquired by the Company may be used to satisfy
awards under the Incentive Plan. If authorized but unissued shares are used to
satisfy restricted stock awards and the exercise of options granted under the
Incentive Plan, it will result in an increase in the number of shares
outstanding and will have a dilutive effect on the holdings of existing
stockholders. The Company may establish a trust under which the trustee will
purchase, with contributions from the Company or Palmyra Savings, previously
issued shares to fund the Company's obligation for restricted stock awards. As
of the date of this proxy statement, no awards have been granted under the
Incentive Plan.
Types of Awards
General. The Incentive Plan authorizes the grant of awards in the form of:
(1) options intended to qualify as incentive stock options under Section 422 of
the Internal Revenue Code (options which provide certain tax benefits to the
recipients upon compliance with applicable requirements, but which do not result
in tax deductions to the Company); (2) options that do not so qualify (options
which do not provide the same income tax benefits to recipients, but which may
provide tax deductions to the Company), referred to as "non-statutory stock
options"; and (3) grants of restricted shares of common stock. Each type of
award may be subject to certain vesting or service requirements or other
conditions imposed by the Committee.
8
Options. Subject to the terms of the Incentive Plan, the Committee has the
authority to determine the amount of options granted to any individual and the
date or dates on which each option will become exercisable and any other
conditions applicable to an option. The exercise price of all options will be
determined by the Committee but will be at least 100% of the fair market value
of the underlying common stock at the time of grant. The exercise price of any
option may be paid in cash, common stock, or any other form permitted by the
Committee at its discretion. See "-Alternate Option Payments" below. The term
of options will be determined by the Committee, but in no event will an option
be exercisable more than ten years from the date of grant (or five years from
date of grant for a 10% owner with respect to incentive stock options).
All options granted under the Incentive Plan to officers and employees may,
at the discretion of the Committee, qualify as incentive stock options to the
extent permitted under Section 422 of the Internal Revenue Code. Under certain
circumstances, incentive stock options may be converted into non-statutory stock
options. In order to qualify as incentive stock options under Section 422 of
the Internal Revenue Code, the option must generally be granted only to an
employee, must not be transferable (other than by will or the laws of descent
and distribution), the exercise price must not be less than 100% of the fair
market value of the common stock on the date of grant, the term of the option
may not exceed ten years from the date of grant, and no more than $100,000 of
options may become exercisable for the first time in any calendar year.
Notwithstanding the foregoing requirements, incentive stock options granted to
any person who is the beneficial owner of more than 10% of the outstanding
voting stock of the Company may be exercised only for a period of five years
from the date of grant and the exercise price must be at least equal to 110% of
the fair market value of the underlying common stock on the date of grant. Each
non-employee director of the Company or its affiliates, as well as employees,
will be eligible to receive non-statutory stock options.
Unless the Committee determines otherwise, upon termination of an option
holder's services for any reason other than death, disability, retirement,
change in control or termination for cause, all then exercisable options will
remain exercisable for three months following termination, or if sooner, the
expiration of the term of the option If an option holder dies or becomes
disabled all unexercisable options will become exercisable and remain
exercisable for two years, or if sooner, the expiration of the term of the
option. Upon the occurrence of a change in control, all unexercisable options
held by the option holder will become fully exercisable and remain exercisable
until the expiration of the term of the option. In the event of termination for
cause, all exercisable and unexercisable options held by the option holder will
be canceled. If an option holder retires, all unexercisable options will be
canceled, unless the Committee, in its sole discretion, allows unexercisable
options to continue to vest or become exercisable according to their original
terms.
Under generally accepted accounting principles, compensation expense is
generally not recognized with respect to the award of stock options.
Restricted Stock Awards. Subject to the terms of the Incentive Plan and
applicable regulation, the Committee has the authority to determine the amounts
of restricted stock awards granted to any individual and the dates on which
restricted stock awards granted will vest or any other conditions which must be
satisfied before vesting.
Stock award recipients may also receive amounts equal to accumulated cash
and stock dividends or other distributions (if any) with respect to shares
awarded in the form of restricted stock. In addition, before vesting,
recipients of restricted stock awards may also direct the voting of shares of
common stock granted to them.
9
Unless the Committee determines otherwise, upon termination of the services
of a holder of a stock award for any reason other than death, disability,
retirement, change in control or termination for cause, all the holder's rights
in unvested restricted stock awards will be canceled. If the holder of the
stock award dies or becomes disabled or upon the occurrence of a change in
control, all unvested restricted stock awards held by such individual will
become fully vested. In the event of termination for cause of a holder of a
stock award, all unvested stock awards held by such individual will be canceled.
If the holder of a stock award retires, all unvested restricted stock awards
held by such individual will be canceled unless the Committee, in its sole
discretion, determines that all unvested restricted stock awards will continue
to vest or be vested in accordance with the original terms of the grant.
Tax Treatment
Options. An option holder will generally not be deemed to have recognized
taxable income upon grant or exercise of any incentive stock option, provided
that shares transferred in connection with the exercise are not disposed of by
the optionee for at least one year after the date the shares are transferred in
connection with the exercise of the option and two years after the date of grant
of the option. If these holding periods are satisfied, upon disposal of the
shares, the aggregate difference between the per share option exercise price and
the fair market value of the common stock is recognized as income taxable at
capital gains rates. No compensation deduction may be taken by the Company as a
result of the grant or exercise of incentive stock options, assuming these
holding periods are met.
In the case of the exercise of a non-statutory stock option, an option
holder will be deemed to have received ordinary income upon exercise of the
option in an amount equal to the aggregate amount by which the fair market value
of the common stock exceeds the exercise price of the option. If shares
received through the exercise of an incentive stock option are disposed of
before the satisfaction of the holding periods (a "disqualifying disposition"),
the exercise of the option will essentially be treated as the exercise of a non-
statutory stock option, except that the option holder will recognize the
ordinary income for the year in which the disqualifying disposition occurs. The
amount of any ordinary income recognized by an optionee upon the exercise of a
non-statutory stock option or due to a disqualifying disposition will be a
deductible expense of the Company for federal income tax purposes.
Restricted Stock Awards. A participant who has been awarded restricted
stock under the Incentive Plan and does not make an election under Section 83(b)
of the Internal Revenue Code will not recognize taxable income at the time of
the award. At the time any transfer or forfeiture restrictions applicable to
the restricted stock award lapse, the recipient will recognize ordinary income
and the Company will be entitled to a corresponding deduction equal to the
excess of the fair market value of such stock at such time over the amount paid,
if any, therefor. Any dividend paid to the recipient on the restricted stock at
or prior to such time will be ordinary compensation income to the recipient and
deductible as such by the Company.
A recipient of a restricted stock award who makes an election under Section
83(b) of the Code will recognize ordinary income at the time of the award and
the Company will be entitled to a corresponding deduction equal to the fair
market value of such stock at such time over the amount paid, if any, therefor.
Any dividends subsequently paid to the recipient on the restricted stock will be
dividend income to the recipient and not deductible by the Company. If the
recipient makes a Section 83(b) election, there are no federal income tax
consequences either to the recipient or the Company at the time any transfer or
forfeiture restrictions applicable to the restricted stock award lapse.
10
Alternate Option Payments
Subject to the terms of the Incentive Plan, the Committee has discretion to
determine the form of payment for the exercise of an option. The Committee may
indicate acceptable forms in the award agreement covering such options or may
reserve its decision to the time of exercise. No option is to be considered
exercised until payment in full is accepted by the Committee. Any shares of
common stock tendered in payment of the exercise price of an option will be
valued at the fair market value of the common stock on the date before the date
of exercise.
Amendments
Subject to certain restrictions contained in the Incentive Plan, the Board
of Directors or the Committee may amend the Incentive Plan in any respect, at
any time, provided that no amendment may affect the rights of the holder of an
award without his or her permission and such amendment must comply with
applicable law and regulation.
Adjustments
If there is any change in the outstanding shares of common stock of the
Company by reason of any stock dividend or split, recapitalization, merger,
consolidation, spin-off, reorganization, combination or exchange of shares, or
other similar corporate change, or other increase or decrease in such shares
without receipt or payment of consideration by the Company, or if an
extraordinary capital distribution is made, including the payment of an
extraordinary dividend, the Committee may make such adjustments to previously
granted awards, to prevent dilution, diminution or enlargement of the rights of
the holder; provided, however, that in the case of an extraordinary dividend,
the Committee may be required to obtain approval of the Office of Thrift
Supervision before any such adjustment. All awards under this Incentive Plan
will be binding upon any successors or assigns of the Company.
Nontransferability
Unless the Committee determines otherwise, awards under the Incentive Plan
will not be transferable by the recipient other than by will or the laws of
intestate succession or pursuant to a domestic relations order. With the
consent of the Committee, a recipient may permit transferability or assignment
for valid estate planning purposes of a non-statutory stock option as permitted
under the Internal Revenue Code or federal securities laws and a participant may
designate a person or his or her estate as beneficiary of any award to which the
recipient would then be entitled, if the participant dies.
Stockholder Approval, Effective Date of Plan and Regulatory Compliance
The Incentive Plan is subject to the regulations of the Office of Thrift
Supervision. The Office of Thrift Supervision has not endorsed or approved the
Incentive Plan.
The Incentive Plan provides that it shall become effective on April 1,
2000, subject to prior approval of the Incentive Plan by the Company's
stockholders. The effective date of the Incentive Plan has been delayed until
April 1, 2000 to ensure compliance with federal regulations that would otherwise
limit the terms of awards under the Incentive Plan and, specifically, the
circumstances in which the vesting of
11
outstanding awards may be accelerated. Accordingly, assuming stockholder
approval, the Incentive Plan will not be implemented and no awards will be made
before April 1, 2000.
New Plan Benefits
As of the date of this proxy statement, no decisions have been made
regarding the granting of awards under the Incentive Plan.
The Board of Directors recommends that you vote "FOR" approval of the PFSB
Bancorp, Inc. 2000 Stock-Based Incentive Plan.
- --------------------------------------------------------------------------------
PROPOSAL 3 -- RATIFICATION OF INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
Prior to the fiscal year ended September 30, 1998, Palmyra Savings'
consolidated financial statements were audited by Wade, Stables, Schanbacher &
Walker, P.C. The former accountant was dismissed and replaced by Moore, Horton &
Carlson, P.C., which was engaged on August 20, 1998. The decision to change
auditors was approved by the Board of Directors of Palmyra Savings on August 20,
1998.
For the fiscal year ended September 30, 1997 and up to the date of the
replacement of the former accountant, there were no disagreements with the
former accountant on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedure which, if not resolved to
the satisfaction of the former accountant, would have caused it to make a
reference to the subject matter of the disagreement in connection with its
reports. The independent auditors' report on the consolidated financial
statements for the fiscal year ended September 30, 1997 did not contain an
adverse opinion or a disclaimer of opinion, and was not qualified or modified as
to uncertainty, audit scope, or accounting principles.
The Board of Directors has appointed Moore, Horton & Carlson, P.C. to be
its independent auditors for the 2000 fiscal year, subject to the ratification
by stockholders. A representative of Moore, Horton & Carlson, P.C. is expected
to be present at the annual meeting to respond to appropriate questions from
stockholders and will have the opportunity to make a statement should he or she
desire to do so.
If the ratification of the appointment of the independent auditors is not
approved by a majority of the votes cast by stockholders at the annual meeting,
other independent auditors will be considered by the Board of Directors. The
Board of Directors recommends that stockholders vote FOR the ratification of the
appointment of independent auditors.
- --------------------------------------------------------------------------------
MISCELLANEOUS
- --------------------------------------------------------------------------------
The Company will pay the cost of this proxy solicitation. The Company will
reimburse brokerage firms and other custodians, nominees and fiduciaries for
reasonable expenses incurred by them in sending proxy materials to the
beneficial owners of PFSB Bancorp common stock. In addition to soliciting
proxies by mail, directors, officers and regular employees of the Company may
solicit proxies personally or by
12
telephone without receiving additional compensation. The Company has retained
Regan & Associates, Inc. to assist in soliciting proxies for a fee of $3,000,
plus reimbursable expenses up to $1,500.
The Company's Annual Report to Stockholders has been mailed to stockholders
as of the close of business on December 1, 1999. Any stockholder who has not
received a copy of the Annual Report may obtain a copy by writing to the
Secretary of the Company. The Annual Report is not to be treated as part of the
proxy solicitation material or as having been incorporated in this proxy
statement by reference.
A copy of the Company's Form 10-KSB for the fiscal year ended September 30,
1999, as filed with the Securities and Exchange Commission, will be furnished
without charge to stockholders as of the close of business on December 1, 1999
upon written request to Ronald L. Nelson, Corporate Secretary, PFSB Bancorp,
Inc., Palmyra, Missouri 63461.
- --------------------------------------------------------------------------------
STOCKHOLDER PROPOSALS
- --------------------------------------------------------------------------------
Proposals that stockholders seek to have included in the proxy statement
for the Company's next annual meeting must be received by the Company no later
than August 17, 2000. If next years annual meeting is held on a date more than
30 calendar days from January 27, 2001, a stockholder proposal must be received
by a reasonable time before the proxy solicitation for such annual meeting is
made. Any stockholder proposals will be subject to the requirements of the
proxy rules adopted by the Securities and Exchange Commission.
The Company's Bylaws provides that in order for a stockholder to make
nominations for the election of directors or proposals for business to be
brought before the annual meeting, a stockholder must deliver notice of such
nominations and/or proposals to the Secretary not less than 60 nor more than 90
days before the date of the annual meeting; provided that if less than 71 days'
notice of the annual meeting is given to stockholders, such notice must be
delivered not later than the close of the tenth day following the day on which
notice of the annual meeting was mailed to stockholders or public disclosure of
the meeting date was made. A copy of the Bylaws may be obtained from the
Company.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Ronald L. Nelson
Ronald L. Nelson
Corporate Secretary
Palmyra, Missouri
December 15, 1999
13
PFSB BANCORP, INC.
2000 STOCK-BASED INCENTIVE PLAN
1. DEFINITIONS.
-----------
(a) "Affiliate" means any "parent corporation" or "subsidiary corporation"
of the Holding Company, as such terms are defined in Sections 424(e) and 424(f)
of the Code.
(b) "Award" means, individually or collectively, a grant under the Plan of
Non-Statutory Stock Options, Incentive Stock Options and Stock Awards.
(c) "Award Agreement" means an agreement evidencing and setting forth the
terms of an Award.
(d) "Bank" means Palmyra Savings.
(e) "Board of Directors" means the board of directors of the Holding
Company.
(f) "Change in Control" of the Holding Company or the Bank means: (i) an
event of a nature that would be required to be reported in response to Item 1(a)
of the current report on Form 8-K, as in effect on the date hereof, pursuant to
Section 13 or 15(d) of the Exchange Act; or (ii) an event that results in a
change in control of the Bank or the Holding Company within the meaning of the
Home Owners' Loan Act of 1933, as amended, the Federal Deposit Insurance Act,
and the rules and regulations promulgated by the Office of Thrift Supervision
(or its predecessor agency), as in effect on the date hereof (provided, that in
applying the definition of change in control as set forth under the rules and
regulations of the OTS, the Board of Directors shall substitute its judgment for
that of the OTS); or (iii) without limitation such a Change in Control shall be
deemed to have occurred at such time as (A) any "person" (as the term is used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of voting securities of the Bank or the Holding Company representing
20% or more of the Bank's or the Holding Company's outstanding voting securities
or the right to acquire such securities except for any voting securities of the
Bank purchased by the Holding Company and any voting securities purchased by any
employee benefit plan of the Holding Company or its Subsidiaries, or (B)
individuals who constitute the Board of Directors on the date hereof (the
"Incumbent Board") cease for any reason to constitute at least a majority
thereof, provided that any person becoming a director subsequent to the date
hereof whose election was approved by a vote of at least three-quarters of the
directors comprising the Incumbent Board, or whose nomination for election by
the Holding Company's stockholders was approved by a Nominating Committee solely
composed of members which are Incumbent Board members, shall be, for purposes of
this clause (B), considered as though he or she were a member of the Incumbent
Board, or (C) a plan of reorganization, merger, consolidation, sale of all or
substantially all the assets of the Bank or the Holding Company or similar
transaction occurs or is effectuated in which the Bank or Holding Company is not
the resulting entity; provided, however, that such an event listed above will be
deemed to have occurred or to have been effectuated upon the receipt of all
required federal regulatory approvals not including the lapse of any statutory
waiting periods, or (D) a proxy statement has been distributed soliciting
proxies from stockholders of the Holding Company, by someone other than the
current management of the Holding Company, seeking stockholder approval of a
plan of reorganization, merger or consolidation of the Holding Company or Bank
with one or more corporations as a result of which the outstanding shares of the
class of securities then subject to such plan or transaction are exchanged for
or converted into cash or property or securities not issued by the Bank or the
Holding Company, or (E) a tender
offer is made for 20% or more of the voting securities of the Bank or Holding
Company then outstanding by a person other than the Bank or Holding Company.
(g) "Code" means the Internal Revenue Code of 1986, as amended.
(h) "Committee" means the committee designated by the Board of Directors,
pursuant to Section 2 of the Plan, to administer the Plan.
(i) "Common Stock" means the common stock of the Holding Company, par
value $.01 per share.
(j) "Date of Grant" means the effective date of an Award.
(k) "Disability" means any mental or physical condition with respect to
which the Participant qualifies for and receives benefits for under a long-term
disability plan of the Holding Company or an Affiliate, or in the absence of
such a long-term disability plan or coverage under such a plan, "Disability"
shall mean a physical or mental condition which, in the sole discretion of the
Committee, is reasonably expected to be of indefinite duration and to
substantially prevent the Participant from fulfilling his or her duties or
responsibilities to the Holding Company or an Affiliate.
(l) "Effective Date" means April 1, 2000, but only if, prior to such date,
the Plan is approved by the Holding Company's shareholders. The Plan will be so
approved if at an annual or special meeting of shareholders held prior to such
date a quorum is present and the majority of the votes cast at such meeting by
the holders of the Common Stock shall be cast in favor of its approval.
(m) "Employee" means any person employed by the Holding Company or an
Affiliate. Directors who are employed by the Holding Company or an Affiliate
shall be considered Employees under the Plan.
(n) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(o) "Exercise Price" means the price at which a Participant may purchase a
share of Common Stock pursuant to an Option.
(p) "Fair Market Value" means the market price of Common Stock, determined
by the Committee as follows:
(i) If the Common Stock was traded on the date in question on The
Nasdaq Stock Market, then the Fair Market Value shall be equal
to the closing price reported for such date;
(ii) If the Common Stock was traded on a stock exchange on the date
in question, then the Fair Market Value shall be equal to the
closing price reported by the applicable composite transactions
report for such date; and
(iii) If neither of the foregoing provisions is applicable, then the
Fair Market Value shall be determined by the Committee in good
faith on such basis as it deems appropriate.
A-2
Whenever possible, the determination of Fair Market Value by the Committee
shall be based on the prices reported in The Wall Street Journal. The
-----------------------
Committee's determination of Fair Market Value shall be conclusive and binding
on all persons.
(q) "Holding Company" means PFSB Bancorp, Inc.
(r) "Incentive Stock Option" means a stock option granted to a
Participant, pursuant to Section 7 of the Plan, that is intended to meet the
requirements of Section 422 of the Code.
(s) "Non-Statutory Stock Option" means a stock option granted to a
Participant pursuant to the terms of the Plan but which is not intended to be
and is not identified as an Incentive Stock Option or a stock option granted
under the Plan which is intended to be and is identified as an Incentive Stock
Option but which does not meet the requirements of Section 422 of the Code.
(t) "Option" means an Incentive Stock Option or Non-Statutory Stock
Option.
(u) "Outside Director" means a member of the board(s) of directors of the
Holding Company or an Affiliate who is not also an Employee of the Holding
Company or an Affiliate.
(v) "Participant" means any person who holds an outstanding Award.
(w) "Plan" means this PFSB Bancorp, Inc. 2000 Stock-Based Incentive Plan.
(x) "Retirement" means retirement from employment with the Holding Company
or an Affiliate in accordance with the then current retirement policies of the
Holding Company or Affiliate, as applicable. "Retirement" with respect to an
Outside Director means the termination of service from the board(s) of directors
of the Holding Company and any Affiliate following written notice to such
board(s) of directors of the Outside Director's intention to retire.
(y) "Stock Award" means an Award granted to a Participant pursuant to
Section 8 of the Plan.
(z) "Termination for Cause" means termination because of a Participant's
personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty
involving personal profit, intentional failure to perform stated duties, willful
violation of any law, rule or regulation (other than traffic violations or
similar offenses) or material breach of any provision of any employment
agreement between the Holding Company and/or any subsidiary of the Holding
Company and a Participant.
(aa) "Trust" means a trust established by the Board of Directors in
connection with this Plan to hold Common Stock or other property for the
purposes set forth in the Plan.
(bb) "Trustee" means any person or entity approved by the Board of
Directors or its designee(s) to hold any of the Trust assets.
2. ADMINISTRATION.
--------------
(a) The Committee shall administer the Plan. The Committee shall consist
of two or more disinterested directors of the Holding Company, who shall be
appointed by the Board of Directors. A
A-3
member of the Board of Directors shall be deemed to be "disinterested" only if
he or she satisfies such requirements as the Securities and Exchange Commission
may establish for non-employee directors administering plans intended to qualify
for exemption under Rule 16b-3 (or its successor) under the Exchange Act.
(b) The Committee shall (i) select the Employees and Outside Directors who
are to receive Awards under the Plan, (ii) determine the type, number, vesting
requirements and other features and conditions of such Awards, (iii) interpret
the Plan and Award Agreements in all respects and (iv) make all other decisions
relating to the operation of the Plan. The Committee may adopt such rules or
guidelines as it deems appropriate to implement the Plan. The Committee's
determinations under the Plan shall be final and binding on all persons.
(c) Each Award shall be evidenced by a written agreement ("Award
Agreement") containing such provisions as may be required by the Plan and
otherwise approved by the Committee. Each Award Agreement shall constitute a
binding contract between the Holding Company or an Affiliate and the
Participant, and every Participant, upon acceptance of an Award Agreement, shall
be bound by the terms and restrictions of the Plan and the Award Agreement. The
terms of each Award Agreement shall be in accordance with the Plan, but each
Award Agreement may include any additional provisions and restrictions
determined by the Committee, in its discretion, provided that such additional
provisions and restrictions are not inconsistent with the terms of the Plan. In
particular and at a minimum, the Committee shall set forth in each Award
Agreement: (i) the type of Award granted; (ii) the Exercise Price of any Option;
(iii) the number of shares subject to the Award; (iv) the expiration date of the
Award; (v) the manner, time, and rate (cumulative or otherwise) of exercise or
vesting of such Award; and (vi) the restrictions, if any, placed upon such
Award, or upon shares which may be issued upon exercise of such Award. The
Chairman of the Committee and such other directors and officers as shall be
designated by the Committee is hereby authorized to execute Award Agreements on
behalf of the Company or an Affiliate and to cause them to be delivered to the
recipients of Awards.
(d) The Committee may delegate all authority for: (i) the determination of
forms of payment to be made by or received by the Plan and (ii) the execution of
any Award Agreement.
3. TYPES OF AWARDS.
---------------
The following Awards may be granted under the Plan:
(a) Non-Statutory Stock Options.
(b) Incentive Stock Options.
(c) Stock Awards.
4. STOCK SUBJECT TO THE PLAN.
-------------------------
Subject to adjustment as provided in Section 13 of the Plan, the number of
shares reserved for Awards under the Plan is 78,260. Subject to adjustment as
provided in Section 13 of the Plan, the number of shares reserved hereby for
purchase pursuant to the exercise of Options granted under the Plan is 55,900.
The number of the shares reserved for Stock Awards is 22,360. The shares of
Common Stock issued under the Plan may be either authorized but unissued shares
or authorized shares previously issued and acquired or reacquired by the Trustee
or the Holding Company, respectively. To the extent that Options and Stock
A-4
Awards are granted under the Plan, the shares underlying such Awards will be
unavailable for any other use including future grants under the Plan except
that, to the extent that Stock Awards or Options terminate, expire or are
forfeited without having vested or without having been exercised, new Awards may
be made with respect to these shares.
5. ELIGIBILITY.
-----------
Subject to the terms of the Plan, all Employees and Outside Directors shall
be eligible to receive Awards under the Plan. In addition, the Committee may
grant eligibility to consultants and advisors of the Holding Company or an
Affiliate, as it sees fit.
6. NON-STATUTORY STOCK OPTIONS.
---------------------------
The Committee may, subject to the limitations of the Plan and the
availability of shares of Common Stock reserved but not previously awarded under
the Plan, grant Non-Statutory Stock Options to eligible individuals upon such
terms and conditions as it may determine to the extent such terms and conditions
are consistent with the following provisions:
(a) Exercise Price. The Committee shall determine the Exercise Price of
--------------
each Non-Statutory Stock Option. However, the Exercise Price shall not be less
than 100% of the Fair Market Value of the Common Stock on the Date of Grant.
(b) Terms of Non-Statutory Stock Options. The Committee shall determine
------------------------------------
the term during which a Participant may exercise a Non-Statutory Stock Option,
but in no event may a Participant exercise a Non-Statutory Stock Option, in
whole or in part, more than ten (10) years from the Date of Grant. The
Committee shall also determine the date on which each Non-Statutory Stock
Option, or any part thereof, first becomes exercisable and any terms or
conditions a Participant must satisfy in order to exercise each Non-Statutory
Stock Option. The shares of Common Stock underlying each Non-Statutory Stock
Option may be purchased in whole or in part by the Participant at any time
during the term of such Non-Statutory Stock Option, or any portion thereof, once
the Non-Statutory Stock Option becomes exercisable.
(c) Non-Transferability. Unless otherwise determined by the Committee in
-------------------
accordance with this Section 6(c), a Participant may not transfer, assign,
hypothecate, or dispose of in any manner, other than by will or the laws of
intestate succession, a Non-Statutory Stock Option. The Committee may, however,
in its sole discretion, permit transferability or assignment of a Non-Statutory
Stock Option if such transfer or assignment is, in its sole determination, for
valid estate planning purposes and such transfer or assignment is permitted
under the Code and Rule 16b-3 under the Exchange Act. For purposes of this
Section 6(c), a transfer for valid estate planning purposes includes, but is not
limited to: (a) a transfer to a revocable intervivos trust as to which the
Participant is both the settlor and trustee, or (b) a transfer for no
consideration to: (i) any member of the Participant's Immediate Family, (ii) any
trust solely for the benefit of members of the Participant's Immediate Family,
(iii) any partnership whose only partners are members of the Participant's
Immediate Family, and (iv) any limited liability corporation or corporate entity
whose only members or equity owners are members of the Participant's Immediate
Family. For purposes of this Section 6(c), "Immediate Family" includes, but is
not necessarily limited to, a Participant's parents, grandparents, spouse,
children, grandchildren, siblings (including half bothers and sisters), and
individuals who are family members by adoption. Nothing contained in this
Section 6(c) shall be construed to require the Committee to give its approval to
any transfer or assignment of any Non-Statutory Stock Option or portion thereof,
and
A-5
approval to transfer or assign any Non-Statutory Stock Option or portion thereof
does not mean that such approval will be given with respect to any other Non-
Statutory Stock Option or portion thereof. The transferee or assignee of any
Non-Statutory Stock Option shall be subject to all of the terms and conditions
applicable to such Non-Statutory Stock Option immediately prior to the transfer
or assignment and shall be subject to any other conditions prescribed by the
Committee with respect to such Non-Statutory Stock Option.
(d) Termination of Employment or Service (General). Unless otherwise
----------------------------------------------
determined by the Committee, upon the termination of a Participant's employment
or other service for any reason other than Retirement, Disability or death, a
Change in Control, or Termination for Cause, the Participant may exercise only
those Non-Statutory Stock Options that were immediately exercisable by the
Participant at the date of such termination and only for a period of three (3)
months following the date of such termination, or, if sooner, until the
expiration of the term of the Option.
(e) Termination of Employment or Service (Retirement). Unless otherwise
-------------------------------------------------
determined by the Committee, in the event of a Participant's Retirement, the
Participant may exercise only those Non-Statutory Stock Options that were
immediately exercisable by the Participant at the date of Retirement and only
for a period of one (1) year from the date of Retirement or, if sooner, until
the expiration of the term of the Option.
(f) Termination of Employment or Service (Disability or Death). Unless
----------------------------------------------------------
otherwise determined by the Committee, in the event of the termination of a
Participant's employment or other service due to Disability or death, all Non-
Statutory Stock Options held by such Participant shall immediately become
exercisable and remain exercisable for a period two (2) years following the date
of such termination, or, if sooner, until the expiration of the term of the
Option.
(g) Termination of Employment or Service (Termination for Cause). Unless
------------------------------------------------------------
otherwise determined by the Committee, in the event of a Participant's
Termination for Cause, all rights with respect to the Participant's Non-
Statutory Stock Options shall expire immediately upon the effective date of such
Termination for Cause.
(h) Acceleration Upon a Change in Control. In the event of a Change in
-------------------------------------
Control all Non-Statutory Stock Options held by a Participant as of the date of
the Change in Control shall immediately become exercisable and shall remain
exercisable until the expiration of the term of the Non-Statutory Stock Options
regardless of termination of employment or service.
(i) Payment. Payment due to a Participant upon the exercise of a Non-
-------
Statutory Stock Option shall be made in the form of shares of Common Stock.
7. INCENTIVE STOCK OPTIONS.
-----------------------
The Committee may, subject to the limitations of the Plan and the
availability of shares of Common Stock reserved but unawarded under this Plan,
grant Incentive Stock Options to an Employee upon such terms and conditions as
it may determine to the extent such terms and conditions are consistent with the
following provisions:
A-6
(a) Exercise Price. The Committee shall determine the Exercise Price of
--------------
each Incentive Stock Option. However, the Exercise Price shall not be less than
100% of the Fair Market Value of the Common Stock on the Date of Grant;
provided, however, that if at the time an Incentive Stock Option is granted, the
Employee owns or is treated as owning, for purposes of Section 422 of the Code,
Common Stock representing more than 10% of the total combined voting securities
of the Holding Company ("10% Owner"), the Exercise Price shall not be less than
110% of the Fair Market Value of the Common Stock on the Date of Grant.
(b) Amounts of Incentive Stock Options. To the extent the aggregate Fair
----------------------------------
Market Value of shares of Common Stock with respect to which Incentive Stock
Options that are exercisable for the first time by an Employee during any
calendar year under the Plan and any other stock option plan of the Holding
Company or an Affiliate exceeds $100,000, or such higher value as may be
permitted under Section 422 of the Code, such Options in excess of such limit
shall be treated as Non-Statutory Stock Options. Fair Market Value shall be
determined as of the Date of Grant with respect to each such Incentive Stock
Option.
(c) Terms of Incentive Stock Options. The Committee shall determine the
--------------------------------
term during which a Participant may exercise an Incentive Stock Option, but in
no event may a Participant exercise an Incentive Stock Option, in whole or in
part, more than ten (10) years from the Date of Grant; provided, however, that
if at the time an Incentive Stock Option is granted to an Employee who is a 10%
Owner, the Incentive Stock Option granted to such Employee shall not be
exercisable after the expiration of five (5) years from the Date of Grant. The
Committee shall also determine the date on which each Incentive Stock Option, or
any part thereof, first becomes exercisable and any terms or conditions a
Participant must satisfy in order to exercise each Incentive Stock Option. The
shares of Common Stock underlying each Incentive Stock Option may be purchased
in whole or in part at any time during the term of such Incentive Stock Option
after such Option becomes exercisable.
(d) Non-Transferability. No Incentive Stock Option shall be transferable
-------------------
except by will or the laws of descent and distribution and is exercisable,
during his or her lifetime, only by the Employee to whom the Committee grants
the Incentive Stock Option. The designation of a beneficiary does not
constitute a transfer of an Incentive Stock Option.
(e) Termination of Employment (General). Unless otherwise determined by
-----------------------------------
the Committee, upon the termination of a Participant's employment or other
service for any reason other than Retirement, Disability or death, a Change in
Control, or Termination for Cause, the Participant may exercise only those
Incentive Stock Options that were immediately exercisable by the Participant at
the date of such termination and only for a period of three (3) months following
the date of such termination, or, if sooner, until the expiration of the term of
the Option.
(f) Termination of Employment (Retirement). Unless otherwise determined by
--------------------------------------
the Committee, in the event of a Participant's Retirement, the Participant may
exercise only those Incentive Stock Options that were immediately exercisable by
the Participant at the date of Retirement and only for a period of one (1) year
from the date of Retirement, or, if sooner, until the expiration of the term of
the Option. Any Option originally designated as an Incentive Stock Option shall
be treated as a Non-Statutory Stock Option to the extent the Option does not
otherwise qualify as an Incentive Stock Option pursuant to Section 422 of the
Code.
A-7
(g) Termination of Employment (Disability or Death). Unless otherwise
-----------------------------------------------
determined by the Committee, in the event of the termination of a Participant's
employment or other service due to Disability or death, all Incentive Stock
Options held by such Participant shall immediately become exercisable and remain
exercisable for a period two (2) years following the date of such termination,
or, if sooner, until the expiration of the term of the Option. Any Option
originally designated as an Incentive Stock Option shall be treated as a Non-
Statutory Stock Option to the extent the Option does not otherwise qualify as an
Incentive Stock Option pursuant to Section 422 of the Code.
(h) Termination of Employment (Termination for Cause). Unless otherwise
-------------------------------------------------
determined by the Committee, in the event of an Employee's Termination for
Cause, all rights under such Employee's Incentive Stock Options shall expire
immediately upon the effective date of such Termination for Cause.
(i) Acceleration Upon a Change in Control. In the event of a Change in
-------------------------------------
Control all Incentive Stock Options held by a Participant as of the date of the
Change in Control shall immediately become exercisable and shall remain
exercisable until the expiration of the term of the Incentive Stock Options
regardless of termination of employment or service. Any Option originally
designated as an Incentive Stock Option shall be treated as a Non-Statutory
Stock Option to the extent the Option does not otherwise qualify as an Incentive
Stock Option pursuant to Section 422 of the Code.
(j) Payment. Payment due to a Participant upon the exercise of an
-------
Incentive Stock Option shall be made in the form of shares of Common Stock.
(k) Disqualifying Dispositions. Each Award Agreement with respect to an
--------------------------
Incentive Stock Option shall require the Participant to notify the Committee of
any disposition of shares of Common Stock issued pursuant to the exercise of
such Option under the circumstances described in Section 421(b) of the Code
(relating to certain disqualifying dispositions) within 10 days of such
disposition.
8. STOCK AWARDS.
------------
The Committee may make grants of Stock Awards, which shall consist of the
grant of some number of shares of Common Stock, to a Participant upon such terms
and conditions as it may determine to the extent such terms and conditions are
consistent with the following provisions:
(a) Grants of the Stock Awards. Stock Awards may only be made in whole
--------------------------
shares of Common Stock. Stock Awards may only be granted from shares reserved
under the Plan and available for award at the time the Stock Award is made to
the Participant.
(b) Terms of the Stock Awards. The Committee shall determine the dates on
-------------------------
which Stock Awards granted to a Participant shall vest and any terms or
conditions which must be satisfied prior to the vesting of any Stock Award or
portion thereof. Any such terms or conditions shall be determined by the
Committee as of the Date of Grant.
(c) Termination of Employment or Service (General). Unless otherwise
----------------------------------------------
determined by the Committee, upon the termination of a Participant's employment
or service for any reason other than Retirement, Disability or death, a Change
in Control, or Termination for Cause, any Stock Awards in which the Participant
has not become vested as of the date of such termination shall be forfeited and
any rights the Participant had to such Stock Awards shall become null and void.
A-8
(d) Termination of Employment or Service (Retirement). Unless otherwise
-------------------------------------------------
determined by the Committee, in the event of a Participant's Retirement, any
Stock Awards in which the Participant has not become vested as of the date of
Retirement shall be forfeited and any rights the Participant had to such
unvested Stock Awards shall become null and void.
(e) Termination of Employment or Service (Disability or Death). Unless
----------------------------------------------------------
otherwise determined by the Committee, in the event of a termination of the
Participant's service due to Disability or death all unvested Stock Awards held
by such Participant shall immediately vest as of the date of such termination.
(f) Termination of Employment or Service (Termination for Cause). Unless
------------------------------------------------------------
otherwise determined by the Committee, in the event of the Participant's
Termination for Cause, all Stock Awards in which the Participant had not become
vested as of the effective date of such Termination for Cause shall be forfeited
and any rights such Participant had to such unvested Stock Awards shall become
null and void.
(g) Acceleration Upon a Change in Control. In the event of a Change in
-------------------------------------
Control all unvested Stock Awards held by a Participant shall immediately vest.
(h) Issuance of Certificates. Unless otherwise held in Trust and
------------------------
registered in the name of the Trustee, reasonably promptly after the Date of
Grant with respect to shares of Common Stock pursuant to a Stock Award, the
Holding Company shall cause to be issued a stock certificate, registered in the
name of the Participant to whom such Stock Award was granted, evidencing such
shares; provided, that the Holding Company shall not cause such a stock
certificate to be issued unless it has received a stock power duly endorsed in
blank with respect to such shares. Each such stock certificate shall bear the
following legend:
"The transferability of this certificate and the shares of stock
represented hereby are subject to the restrictions, terms and conditions
(including forfeiture provisions and restrictions against transfer)
contained in the PFSB Bancorp, Inc. 2000 Stock-Based Incentive Plan and
Award Agreement entered into between the registered owner of such shares
and PFSB Bancorp, Inc. or its Affiliates. A copy of the Plan and Award
Agreement is on file in the office of the Corporate Secretary of PFSB
Bancorp, Inc. located at 123 West Lafayette Street, Palmyra, Missouri
63461.
Such legend shall not be removed until the Participant becomes vested in such
shares pursuant to the terms of the Plan and Award Agreement. Each certificate
issued pursuant to this Section 8(h), in connection with a Stock Award, shall be
held by the Holding Company or its Affiliates, unless the Committee determines
otherwise.
(i) Non-Transferability. Except to the extent permitted by the Code, the
-------------------
rules promulgated under Section 16(b) of the Exchange Act or any successor
statutes or rules:
(i) The recipient of a Stock Award shall not sell, transfer, assign,
pledge, or otherwise encumber shares subject to the Stock Award
until full vesting of such shares has occurred. For purposes of
this section, the separation of beneficial ownership and
A-9
legal title through the use of any "swap" transaction is deemed
to be a prohibited encumbrance.
(ii) Unless determined otherwise by the Committee and except in the
event of the Participant's death or pursuant to a domestic
relations order, a Stock Award is not transferable and may be
earned in his or her lifetime only by the Participant to whom it
is granted. Upon the death of a Participant, a Stock Award is
transferable by will or the laws of descent and distribution. The
designation of a beneficiary shall not constitute a transfer.
(iii) If a recipient of a Stock Award is subject to the provisions of
Section 16 of the Exchange Act, shares of Common Stock subject to
such Stock Award may not, without the written consent of the
Committee (which consent may be given in the Award Agreement), be
sold or otherwise disposed of within six (6) months following the
date of grant of the Stock Award.
(j) Accrual of Dividends. To the extent Stock Awards are held in Trust and
--------------------
registered in the name of the Trustee, unless otherwise specified by the Trust
agreement, whenever shares of Common Stock underlying a Stock Award are
distributed to a Participant or beneficiary thereof under the Plan, such
Participant or beneficiary shall also be entitled to receive, with respect to
each such share distributed, a payment equal to any cash dividends and the
number of shares of Common Stock equal to any stock dividends, declared and paid
with respect to a share of the Common Stock if the record date for determining
shareholders entitled to receive such dividends falls between the date the
relevant Stock Award was granted and the date the relevant Stock Award or
installment thereof is issued. There shall also be distributed an appropriate
amount of net earnings, if any, of the Trust with respect to any dividends paid
out on the shares related to the Stock Award.
(k) Voting of Stock Awards. After a Stock Award has been granted but for
----------------------
which the shares covered by such Stock Award have not yet been vested, earned
and distributed to the Participant pursuant to the Plan, the Participant shall
be entitled to vote or to direct the Trustee to vote, as the case may be, such
shares of Common Stock which the Stock Award covers subject to the rules and
procedures adopted by the Committee for this purpose and in a manner consistent
with the Trust agreement.
(l) Payment. Payment due to a Participant upon the redemption of a Stock
-------
Award shall be made in the form of shares of Common Stock.
9. DEFERRED PAYMENTS.
-----------------
The Committee, in its discretion, may permit a Participant to elect to
defer receipt of all or any part of any cash or stock payment under the Plan, or
the Committee may determine to defer receipt by some or all Participants, of all
or part of any such payment. The Committee shall determine the terms and
conditions of any such deferral, including the period of deferral, the manner of
deferral, and the method for measuring appreciation on deferred amounts until
their payout.
A-10
10. METHOD OF EXERCISE OF OPTIONS.
-----------------------------
Subject to any applicable Award Agreement, any Option may be exercised by
the Participant in whole or in part at such time or times, and the Participant
may make payment of the Exercise Price in such form or forms permitted by the
Committee, including, without limitation, payment by delivery of cash, Common
Stock or other consideration (including, where permitted by law and the
Committee, Awards) having a Fair Market Value on the day immediately preceding
the exercise date equal to the total Exercise Price, or by any combination of
cash, shares of Common Stock and other consideration, including exercise by
means of a cashless exercise arrangement with a qualifying broker-dealer, as the
Committee may specify in the applicable Award Agreement.
11. RIGHTS OF PARTICIPANTS.
----------------------
No Participant shall have any rights as a shareholder with respect to any
shares of Common Stock covered by an Option until the date of issuance of a
stock certificate for such Common Stock. Nothing contained herein or in any
Award Agreement confers on any person any right to continue in the employ or
service of the Holding Company or an Affiliate or interferes in any way with the
right of the Holding Company or an Affiliate to terminate a Participant's
services.
12. DESIGNATION OF BENEFICIARY.
--------------------------
A Participant may, with the consent of the Committee, designate a person or
persons to receive, in the event of death, any Award to which the Participant
would then be entitled. Such designation will be made upon forms supplied by
and delivered to the Holding Company and may be revoked in writing. If a
Participant fails effectively to designate a beneficiary, then the Participant's
estate will be deemed to be the beneficiary.
13. DILUTION AND OTHER ADJUSTMENTS.
------------------------------
In the event of any change in the outstanding shares of Common Stock by
reason of any stock dividend or split, recapitalization, merger, consolidation,
spin-off, reorganization, combination or exchange of shares, or other similar
corporate change, or other increase or decrease in such shares without receipt
or payment of consideration by the Holding Company, or in the event an
extraordinary capital distribution is made, the Committee may make such
adjustments to previously granted Awards, to prevent dilution, diminution, or
enlargement of the rights of the Participant, including any or all of the
following:
(a) adjustments in the aggregate number or kind of shares of Common Stock
or other securities that may underlie future Awards under the Plan;
(b) adjustments in the aggregate number or kind of shares of Common Stock
or other securities underlying Awards already made under the Plan;
(c) adjustments in the Exercise Price of outstanding Incentive and/or
Non-Statutory Stock Options.
No such adjustments may, however, materially change the value of benefits
available to a Participant under a previously granted Award. All Awards under
this Plan shall be binding upon any successors or assigns
A-11
of the Holding Company. Notwithstanding the above, in the event of an
extraordinary capital distribution, any adjustment under this Section 13 shall
be subject to required approval by the Office of Thrift Supervision.
14. TAXES.
-----
(a) Whenever under this Plan, cash or shares of Common Stock are to be
delivered upon exercise or payment of an Award or any other event with respect
to rights and benefits hereunder, the Committee shall be entitled to require as
a condition of delivery (i) that the Participant remit an amount sufficient to
satisfy all federal, state, and local withholding tax requirements related
thereto, (ii) that the withholding of such sums come from compensation otherwise
due to the Participant or from any shares of Common Stock due to the Participant
under this Plan or (iii) any combination of the foregoing; provided, however,
that no amount shall be withheld from any cash payment or shares of Common Stock
relating to an Award which was transferred by the Participant in accordance with
this Plan. Furthermore, Participants may direct the Committee to instruct the
Trustee to sell shares of Common Stock to be delivered upon the payment of an
Award to satisfy tax obligations.
(b) If any disqualifying disposition described in Section 7(k) is made with
respect to shares of Common Stock acquired under an Incentive Stock Option
granted pursuant to this Plan, or any transfer described in Section 6(c) is
made, or any election described in Section 15 is made, then the person making
such disqualifying disposition, transfer, or election shall remit to the Holding
Company or its Affiliates an amount sufficient to satisfy all federal, state,
and local withholding taxes thereby incurred; provided that, in lieu of or in
addition to the foregoing, the Holding Company or its Affiliates shall have the
right to withhold such sums from compensation otherwise due to the Participant,
or, except in the case of any transfer pursuant to Section 6(c), from any shares
of Common Stock due to the Participant under this Plan.
15. NOTIFICATION UNDER SECTION 83(b).
--------------------------------
The Committee may, on the Date of Grant or any later date, prohibit a
Participant from making the election described below. If the Committee has not
prohibited such Participant from making such election, and the Participant
shall, in connection with the exercise of any Option, or the grant of any Stock
Award, make the election permitted under Section 83(b) of the Code, such
Participant shall notify the Committee of such election within 10 days of filing
notice of the election with the Internal Revenue Service, in addition to any
filing and notification required pursuant to regulations issued under the
authority of Section 83(b) of the Code.
16. AMENDMENT OF THE PLAN AND AWARDS.
--------------------------------
(a) Except as provided in paragraph (c) of this Section 16, the Board of
Directors may at any time, and from time to time, modify or amend the Plan in
any respect, prospectively or retroactively; provided, however, that provisions
governing grants of Incentive Stock Options shall be submitted for shareholder
approval to the extent required by law, regulation or otherwise. Failure to
ratify or approve amendments or modifications by shareholders shall be effective
only as to the specific amendment or modification requiring such ratification or
approval. Other provisions of this Plan will remain in full force and effect.
No such termination, modification or amendment may adversely affect the rights
of a Participant under an outstanding Award without the written permission of
such Participant.
A-12
(b) Except as provided in paragraph (c) of this Section 16, the Committee
may amend any Award Agreement, prospectively or retroactively; provided,
however, that no such amendment shall adversely affect the rights of any
Participant under an outstanding Award without the written consent of such
Participant.
(c) In no event shall the Board of Directors amend the Plan or shall the
Committee amend an Award Agreement in any manner that has the effect of:
(i) Allowing any Option to be granted with an Exercise Price below
the Fair Market Value of the Common Stock on the Date of Grant.
(ii) Allowing the Exercise Price of any Option previously granted
under the Plan to be reduced subsequent to the Date of Award.
(d) Notwithstanding anything in this Plan or any Award Agreement to the
contrary, if any Award or right under this Plan would, in the opinion of the
Holding Company's accountants, cause a transaction to be ineligible for pooling
of interest accounting that would, but for such Award or right, be eligible for
such accounting treatment, the Committee, at its discretion, may modify, adjust,
eliminate or terminate the Award or right so that pooling of interest accounting
is available.
17. EFFECTIVE DATE OF PLAN.
----------------------
The Plan shall become effective on April 1, 2000, but only if, prior to
such date, the Plan is approved by the Holding Company's shareholders. The Plan
will be so approved if at an annual or special meeting of shareholders held
prior to such date a quorum is present and the majority of the votes cast at
such meeting by the holders of the Common Stock shall be cast in favor of its
approval. If the Plan is not approved by shareholders in accordance with the
regulations of the Internal Revenue Service, the Plan shall remain in full force
and effect, and any Incentive Stock Options granted under the Plan shall be
deemed to be Non-Statutory Stock Options.
18. TERMINATION OF THE PLAN.
-----------------------
The right to grant Awards under the Plan will terminate upon the earlier
of: (i) ten (10) years after the Effective Date; (ii) the issuance of a number
of shares of Common Stock pursuant to the exercise of Options or the
distribution of Stock Awards is equivalent to the maximum number of shares
reserved under the Plan as set forth in Section 4 hereof. The Board of
Directors has the right to suspend or terminate the Plan at any time, provided
that no such action will, without the consent of a Participant, adversely affect
a Participant's vested rights under a previously granted Award.
19. APPLICABLE LAW.
--------------
The Plan will be administered in accordance with the laws of the State of
Missouri to the extent not pre-empted by applicable federal law.
A-13
20. TREATMENT OF UNVESTED, UNEXERCISED, OR NON-EXERCISABLE AWARDS UPON A CHANGE
---------------------------------------------------------------------------
IN CONTROL.
-----------
In the event of a Change in Control where the Holding Company or the Bank
is not the surviving entity, the Board of Directors of the Holding Company
and/or the Bank, as applicable, shall require that the successor entity take one
of the following actions with respect to all Awards held by Participants at the
date of the Change in Control:
(a) Assume the Awards with the same terms and conditions as granted to the
Participant under this Plan; or
(b) Replace the Awards with comparable Awards, subject to the same or more
favorable terms and conditions as the Award granted to the Participant under
this Plan, whereby the Participant will be granted common stock or the option to
purchase common stock of the successor entity; or
(c) Replace the Awards with an immediate cash payment of equivalent value.
A-14
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE
REVOCABLE PROXY
PFSB BANCORP, INC.
ANNUAL MEETING OF STOCKHOLDERS
January 27, 2000
_______________________________
The undersigned hereby appoints the full Board of Directors, each with full
power of substitution, to act as proxy for the undersigned, and to vote all
shares of common stock of PFSB Bancorp, Inc. ("Company") owned of record by the
undersigned at the Annual Meeting of Stockholders, to be held on January 27,
2000, at 2:00 p.m., local time, at Palmyra Savings' main office at 123 West
Lafayette Street, Palmyra, Missouri, and at any and all adjournments thereof, as
designated below with respect to the matters set forth below and described in
the accompanying Proxy Statement and, in their discretion, for the election of a
person to the Board of Directors if any nominee named herein becomes unable to
serve or for good cause will not serve and with respect to any other business
that may properly come before the meeting. Any prior proxy or voting
instructions are hereby revoked.
1. The election as directors of all nominees listed (except as marked to
the contrary below):
L. Edward Schaeffer Eldon R. Mette Robert M. Dearing
Glenn J. Maddox Albert E. Davis James D. Lovegreen
Donald L. Slavin
FOR ALL
FOR WITHHOLD EXCEPT
--- -------- ------
[_] [_] [_]
INSTRUCTION: To withhold your vote for any individual nominee, mark "FOR ALL
EXCEPT" and write that nominee's name in the space provided below.
________________________________________________________________________________
2. The approval of the PFSB Bancorp, Inc. 2000 Stock-Based Incentive Plan.
FOR AGAINST ABSTAIN
--- ------- -------
[_] [_] [_]
________________________________________________________________________________
3. The ratification of the appointment of Moore, Horton & Carlson, P.C.
as Independent auditors for the Company for the fiscal year ending September 30,
2000.
FOR AGAINST ABSTAIN
--- ------- -------
[_] [_] [_]
This proxy card will also be used to provide voting instructions to the
trustees for any shares of common stock of the Company allocated to participants
under the Palmyra Savings Employee Stock Ownership Plan and the Palmyra Savings
401(k) Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
EACH OF THE LISTED PROPOSALS.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
This proxy, properly signed and dated, will be voted as directed, but if no
Instructions are specified, this proxy will be voted "FOR" each of the
proposals listed. If any other business is presented at the meeting, including
whether or not to adjourn the meeting, this proxy will be voted by the proxies
in their best judgment. At the present time, the Board of Directors knows of no
other business to be presented at the Annual Meeting.
The above-signed acknowledges receipt from the Company prior to the
execution of this proxy of a Notice of Annual Meeting of Stockholders, a Proxy
Statement for the Annual Meeting and the Annual Report to Stockholders.
Please sign exactly as your name appears on this card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly each holder may sign but only one signature
is required.
Dated:___________________________
_________________________________
STOCKHOLDER SIGNATURE
_________________________________
CO-HOLDER (IF ANY) SIGNATURE
_____________________________
PLEASE COMPLETE, DATE, SIGN AND PROMPTLY MAIL THIS PROXY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE.