UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
|_| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-12
CASS INFORMATION SYSTEMS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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|_| Fee paid previously with preliminary materials.
|_| 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:
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CASS INFORMATION SYSTEMS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held on
April 19, 2004
TO THE SHAREHOLDERS:
The Annual Meeting of Shareholders of Cass Information Systems, Inc. will
be held at the offices of Cass Information Systems, Inc. located at 13001
Hollenberg Drive, Bridgeton, Missouri on Monday, April 19, 2004, at 11:00 a.m.,
for the following purposes:
1. To elect four Directors, each to serve for a three year term;
2. To act upon such other matters as may properly come before the
meeting.
The close of business on March 5, 2004 has been fixed as the record date
for determining shareholders entitled to notice of and to vote at the Meeting.
By Order of the Board of Directors,
Eric H. Brunngraber
Secretary
March 17, 2004
Bridgeton, Missouri
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING.
WHETHER OR NOT YOU INTEND TO BE PRESENT, IT IS IMPORTANT THAT YOUR SHARES BE
REPRESENTED AND VOTED AT THE ANNUAL MEETING. YOU CAN VOTE YOUR SHARES BY ONE OF
THE FOLLOWING METHODS: VOTE OVER THE INTERNET OR BY TELEPHONE USING THE
INSTRUCTIONS ON THE ENCLOSED PROXY CARD, OR MARK, SIGN, DATE AND PROMPTLY RETURN
THE ENCLOSED PROXY CARD. THE PRESENCE, IN PERSON OR BY PROPERLY EXECUTED PROXY,
OF A MAJORITY OF THE COMMON STOCK OUTSTANDING ON THE RECORD DATE IS NECESSARY TO
CONSTITUTE A QUORUM AT THE ANNUAL MEETING.
CASS INFORMATION SYSTEMS, INC.
13001 Hollenberg Drive
Bridgeton, Missouri 63044
PROXY STATEMENT
Annual Meeting of Shareholders
to be held April 19, 2004
This Proxy Statement is being furnished to the common shareholders of Cass
Information Systems, Inc. (the "Company") on or about March 17, 2004 in
connection with the solicitation of proxies on behalf of the Board of Directors
of the Company for use at the annual meeting of shareholders (the "Annual
Meeting") to be held on April 19, 2004 at the time and place and for the
purposes set forth in the accompanying Notice of Annual Meeting, and at any
adjournment or postponement of that meeting.
Holders of shares of common stock, par value $.50 per share ("Shares" or
the "Common Stock"), of the Company at its close of business on March 5, 2004
(the "Record Date") are entitled to receive notice of and vote at the Annual
Meeting. On the Record Date, 3,679,452 shares of Common Stock were outstanding.
Holders of record of Common Stock (the "Shareholders") are entitled to one vote
per share of Common Stock they held of record on the Record Date on each matter
that may properly come before the Annual Meeting. Company management
("Management"), and members of the Board of Directors (the "Board"), in the
aggregate, directly or indirectly controlled approximately 25.90% of the Common
Stock outstanding on the Record Date.
Shareholders of record on the Record Date are entitled to cast their votes
in person or by properly executed proxy at the Annual Meeting. The presence, in
person or by properly executed proxy, of a majority of the Common Stock
outstanding on the Record Date is necessary to constitute a quorum at the Annual
Meeting. If a quorum is not present at the time the Annual Meeting is convened,
the Company may adjourn or postpone the Annual Meeting.
A plurality of the votes of Shareholders cast at the Annual Meeting is
required for the election of each director. Abstentions are counted in the
number of shares present for purposes of determining whether a quorum is
present, and are counted as having voted on each matter presented for vote. As a
result, an abstention has the same effect as a vote against a proposal, but will
have no effect on the vote to elect directors. Broker non-votes are counted in
the number of shares present for purposes of determining whether a quorum is
present, but as not being present as to matters for which voting instructions
are not given. As a result, broker non-votes will not effect voting on any
matter voted on at the meeting.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before it is voted. Proxies may be revoked by (i) filing
with the Secretary of the Company, at or before the Annual Meeting, a written
notice of revocation bearing a date later than the date of the proxy, (ii) duly
executing and dating a subsequent proxy relating to the Common Stock and
delivering it to the Secretary of the Company at or before the vote is taken at
the Annual Meeting, or (iii) attending the Annual Meeting and voting in person
(although attendance at the Annual Meeting will not in and of itself constitute
a revocation of a proxy). Any written notice revoking a proxy should be sent to
Eric H. Brunngraber, Secretary, Cass Information Systems, Inc., 13001 Hollenberg
Drive, Bridgeton, Missouri 63044 (telephone number (314) 506-5500).
All Common Stock represented at the Annual Meeting by properly executed
proxies received prior to or at the Annual Meeting and not properly revoked will
be voted at the Annual Meeting in accordance with the instructions indicated in
such proxies. If no instructions are indicated, such proxies will be voted FOR
the election of the Board's director nominees. The Board of Directors of the
Company does not know of any matters, other than the matters described in the
Notice of Annual Meeting attached to the Proxy Statement that will come before
the Annual Meeting.
The proxies are solicited by the Board of Directors of the Company. In
addition to the use of the mails, proxies may be solicited personally or by
telephone or facsimile transmission, by directors, officers or regular employees
of the Company or persons employed by the Company for the purpose of soliciting
proxies. It is contemplated that brokerage houses, custodians, nominees and
fiduciaries will be requested to forward the soliciting material to the
beneficial owners of Common Stock held of record by such persons, and will be
reimbursed by the Company for expenses incurred therewith. The cost of
solicitation of proxies will be borne by the Company.
1
ELECTION OF DIRECTORS
Pursuant to the by-laws of the Company, the Company's Board of Directors
is divided into three classes of approximately equal numbers of directors. Each
of the twelve directors is elected for a three-year term, and the term of each
class of directors expires in a different year.
During 2003, directors who were not officers of the Company received a
$300 monthly retainer fee, a $600 fee for attendance at each meeting of the
Board and a $400 fee for attendance at each meeting of a Committee of the Board.
Upon re-election to the Board, each director who was not an officer of the
Company received 300 shares of restricted stock, which the director is entitled
to vote and upon which they are entitled to receive dividends. Shares are
subject to a three-year vesting schedule, with 1/3 of the shares vesting each
year on the anniversary date of the awards.
The nominees for election to the Board of Directors are Mr. Collett, Mr.
Grace, Mr. Shepard, and Mr. Signorelli, each of whom is a current director of
the Company. The Board of Directors of the Company recommends a vote FOR the
nominees for election to the Board of Directors.
The members of the Company's Board of Directors whose terms will continue
after the meeting, including the nominees for re-election to the Board, with
certain information about each of them, including their principal occupations
for the past five years, are listed below:
Principal Occupation
Director During Past 5 Years
-------- -------------------
Robert J. Bodine Chairman Emeritus, Bodine
Age: 79 Aluminum, Inc. since 1990.
Director since 1966
Current term expires 2006
Eric H. Brunngraber Chief Financial Officer and
Age: 47 Vice President-Secretary of the
Director since 2003 Company & subsidiaries since 1997.
Current term expires 2005
Bryan S. Chapell President, Covenant
Age: 49 Theological Seminary since 1994.
Director since 1998
Current term expires 2005
Lawrence A. Collett Chairman of the Board of the Company
Age: 61 & subsidiaries since 1992;
Director since 1983 Chief Executive Officer of the
Current term expires 2004 Company & subsidiaries since 1990.
Mr. Collett is a nominee for
re-election to the Board of
Directors.
Thomas J. Fucoloro Retired President, CEO
Age: 78 Todd Uniform
Director since 1986
Current term expires 2006
Wayne J. Grace Managing Director,
Age: 63 Grace Advisors, Inc. since 1983.
Director since 2003 Mr. Grace is a nominee for
Current term expires 2004 re-election to the Board of
Directors.
2
Principal Occupation
Director During Past 5 Years
-------- -------------------
Harry J. Krieg Chairman Emeritus of the Company &
Age: 79 subsidiaries since 1992.
Director since 1962
Current term expires 2006
Howard A. Kuehner Investor
Age: 88 Retired Insurance Agent
Director since 1966
Current term expires 2006
Jake Nania Investor
Age: 79 Retired President, Bridal Originals
Director since 1967
Current term expires 2005
Irving A. Shepard President, Venture
Age: 86 Consultants, Inc. since 1985.
Director since 1970 Mr. Shepard is a nominee for
Current term expires 2004 re-election to the Board of
Directors.
Andrew J. Signorelli Vice President, Andrews Educational
Age: 64 & Research Center since 1983;
Director since 1986 Founder, Hope Educational & Research
Current term expires 2004 Center. Mr. Signorelli is a nominee
for re-election to the Board of
Directors.
Bruce E. Woodruff Attorney, of counsel to Armstrong
Age: 73 TeasdaleLLP since 1996. Prior thereto
Director since 1995 Mr. Woodruff served as Associate and
Current term expires 2005 Partner with Armstrong Teasdale LLP
from 1959 to 1995.
Board and Committee Membership
The Company's Board of Directors oversees and guides the Company's
management and its business. Committees support the role of the Board on issues
that benefit from consideration by a smaller, more focused subset of directors.
Based on the independence standards defined by the rules of Nasdaq, the
Board has determined in its business judgment that each of the 10 non-management
directors on the Board of 12 members is independent. Mr. Collett and Mr.
Brunngraber are members of management and as a result are not considered
independent directors.
During 2003, there were 12 meetings of the Board of Directors. Each
director attended at least 75% of the aggregate number of meetings of the Board
and committees on which he served. The Company's directors are encouraged, but
not required, to attend the Company's annual meeting of shareholders. Six
directors attended the 2003 Annual Meeting.
3
The following table presents, as of March 5, 2004, the key Committees of
the Board, the membership of such Committees and the number of times each such
Committee met in 2003.
---------------------------------------------
Committee
---------------------------------------------
Nominating and
Corporate
Nominee/Director Audit Compensation Governance**
------------------------------------------------------------------------
Robert J. Bodine X
Eric H. Brunngraber
Bryan S. Chapell X
Lawrence A. Collett
Thomas J. Fucoloro
Wayne J. Grace X X
Harry J. Krieg X X*
Howard A. Kuehner
Jake Nania
Irving A. Shepard X X
Andrew J. Signorelli X*
Bruce E. Woodruff X*
------------------------------------------------------------------------
Number of Meetings in 2003: 5 6 --
------------------------------------------------------------------------
* Committee Chairman
** The committee was formed in November 2003 and held its first
meeting in January 2004.
The Audit Committee is composed entirely of independent directors and
operates pursuant to a written charter, included as Exhibit I and available at
www.cassinfo.com. The Committee is responsible for appointing the independent
auditors for the Company, and meeting with the independent auditors and other
corporate officers to review matters relating to corporate financial reporting
and accounting procedures and policies. Among other responsibilities, the Audit
Committee also reviews financial information provided to shareholders and
others, assesses the adequacy of financial, accounting, operating and disclosure
controls, evaluates the scope of the audits of the independent auditors and
reports on the results of such reviews to the Board of Directors. In addition,
the Committee assists the Board in its oversight of the performance of the
Company's internal auditors. The Committee meets with the internal auditors on a
quarterly basis to review the scope and results of such services. The Board of
Directors has determined that Mr. Grace and Mr. Krieg serve as "audit committee
financial experts", as defined by the Securities and Exchange Commission (SEC)
and Nasdaq listing rules.
The Compensation Committee is composed entirely of independent directors
and operates pursuant to a written charter, which is available at
www.cassinfo.com. The Committee reviews and recommends to the Board the salaries
and all other forms of compensation of the officers of the Company and its
subsidiaries.
The Nominating and Corporate Governance Committee is composed entirely of
independent directors and operates pursuant to a written charter, which is
available at www.cassinfo.com. The Nominating and Corporate Governance Committee
is responsible for identifying individuals qualified to become members of the
Board, recommending director nominees, and developing and addressing corporate
governance principles and issues applicable to the Company and its subsidiaries.
In recommending director nominees to the Board, the Committee solicits candidate
recommendations from its own members, other directors and management. Although
the Nominating and Corporate Governance Committee does not specifically solicit
suggestions for possible candidates from shareholders, the Committee will
consider candidates meeting the criteria set by the Committee with the
concurrence of the full Board and re-evaluated periodically, including those set
out in the Committee's charter. Suggestions, together with a description of the
proposed nominee's qualifications, other relevant biographical information and
an indication of the willingness of the proposed nominee to serve, should be
sent to the Nominating and Corporate Governance Committee, c/o Eric H.
Brunngraber, Secretary, Cass Information Systems, Inc., 13001 Hollenberg Drive,
Bridgeton, Missouri 63044.
4
Report of the Audit Committee
The Audit Committee, composed entirely of independent directors, assists
the Board in its oversight of (1) the integrity of the financial statements of
the Company, (2) the independent auditor's qualifications and independence (3)
the performance of the independent auditors and the Company's internal audit
function, and (4) the compliance by the Company with legal and regulatory
requirements. The Audit Committee operates pursuant to a written charter that
was last revised and adopted January 2004, and is included as Exhibit I.
In the performance of its oversight function and in connection with the
December 31, 2003 consolidated financial statements, the Audit Committee
reviewed and discussed the audited consolidated financial statements with
management. The Committee also discussed with the independent auditors the
matters required by Statement on Auditing Standards No. 61, Communications with
Audit Committees, as currently in effect. The Committee has also received and
discussed with the independent auditors the matters required by Independence
Standards Board Statement No. 1, Independence Discussions with Audit Committees,
as currently in effect. The Committee has considered whether the provision of
all non-audit services by the independent auditors to the Company is compatible
with maintaining the independent auditors' independence and has discussed with
them their independence.
Based upon these reviews and discussions, and the roles and
responsibilities of the Committee outlined in its charter, the Audit Committee
recommended to the Board of Directors that the audited consolidated financial
statements be included in the Annual Report on Form 10-K filed with the SEC.
Bruce E. Woodruff, Chairman
Wayne J. Grace
Harry J. Krieg
Irving A. Shepard
Report of the Compensation Committee
The Compensation Committee is appointed by the Board of Directors and is
composed of three independent directors, one of whom serves as chairman of the
Committee. The Committee operates under a written charter approved by the Board
of Directors. The Committee establishes and administers the Company's executive
compensation programs and benefits. During the year, the Committee analyzed,
reviewed and approved each of these programs. While the Committee may seek input
occasionally from the Chief Executive Officer, the Chief Financial Officer or
the Director of Human Resources, all matters are independently resolved and
decided without the presence or voting of any officer of the Company or its
subsidiaries. The Compensation Committee of the Board is also responsible for
recommending salary levels for executive officers to the Board of Directors of
the Company and recommending the overall levels of salary compensation for the
entire corporation.
The Committee's goal with regard to executive compensation has been to
develop and provide a combination of programs, which enables the Company to
attract and retain competent executive officers and other management personnel
with the capabilities and experience necessary to continue leading the Company
in meeting its objectives and in furthering its growth and profitability. It is
further the goal of the Committee to reward executives and managers in
accordance with the results that are accomplished. The Committee believes that
total compensation should be related to profits and to the performance of the
Company. For this reason, overall compensation is tied to incentive bonus plans
that are directly related to the Company's earnings.
In order to determine the levels of peer compensation within its industry,
the Committee utilizes the services of Peter R. Johnson & Company of West
Chester, Pennsylvania. Additionally, when evaluating the cash compensation and
stock incentives for senior executive management, the Committee utilizes the
services of Towers Perrin and other compensation sources for comparison to
companies performing in industries similar to those of the Company. The
Committee considers stock options and grants to be a significant motivational
tool for rewarding its executive officers and senior management. Stock options
and grants provided under the Company's stock incentive programs are awarded
primarily on the basis of performance of the Company, performance of the
individual operating subsidiaries, relationship of the Company's performance to
other companies in its peer group, and the recommendation of the CEO regarding
the individual's performance.
The Committee seeks to maintain salaries at levels competitive with peer
groups. Bonuses are available to all personnel in the Company based upon the
level of profits before taxes achieved by the Company. These bonuses are
distributed on the basis of merit. Performance is measured on the basis of
several factors deemed relevant and bonuses are calculated on the basis of these
evaluations. The determination of bonuses for the Company's executive officers
is a subjective process, which utilizes individual performance, growth in the
5
Company's profits, resources, and the quality of the Company's operations, as
well as adherence to regulatory requirements. The amount of bonus available for
executive officers is a percentage of the profit sharing allocation for all
staff members and is based on the growth in net earnings of the Company. As a
result, the amount available for executive officers in 2003 was increased from
2002 levels and most of the executives received bonuses in 2003 comparable or
slightly higher than those received in 2002 due to the level of profits achieved
in 2003.
Salaries of the CEO, CFO and other executive officers are reviewed by the
Committee annually in December for the following fiscal year. Bonuses are
calculated in July and January, and relate directly to the profit performance
for the year. The CEO's bonus is a percentage of total profit sharing
allocations and fluctuates with the Company's return on equity. The CEO's salary
was increased in 2003 due to improved profitability in 2002. The CEO's bonus for
2003 was directly related to profit performance in 2003 and was slightly higher
than that received in 2002. The CEO also received long-term incentive awards for
2003 in the form of Incentive Stock Options and Restricted Stock Grants.
Andrew J. Signorelli, Chairman
Robert J. Bodine
Irving A. Shepard
Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee is or was during the year ended
December 31, 2003 an officer, former officer or employee of the Company or any
of its subsidiaries or a person having a relationship requiring disclosure by
the Company pursuant to item 404 of SEC Regulation S-K. No executive officer of
the Company served as a member of (i) the compensation committee of another
entity in which one of the executive officers of such entity served on the
Company's Compensation Committee or (ii) the Board of Directors of another
entity in which one of the executive officers of such entity served on the
Company's Board of Directors, during the year ended December 31, 2003.
Certain Relationships and Related Party Transactions
Some of the directors and executive officers of the Company, and members
of their immediate families and firms and corporations with which they are
associated, have had transactions with the Company's subsidiary bank, including
borrowing and investments in depository accounts. All such loans and investments
have been made in the ordinary course of business, have been made on
substantially the same terms, including interest rates charged or paid and
collateral required, as those prevailing at the same time for comparable
transactions with unaffiliated persons, and did not involve more than the normal
risk of collectibility or present other unfavorable features. As of December 31,
2003, the aggregate amount of all loans and available credit to officers and
directors of the Company and to firms and corporations in which they have at
least a 10% beneficial interest was approximately $3,285,081, which represented
approximately 5% of the Company's consolidated shareholders' equity at that
date.
Communications with the Board of Directors
Shareholders may communicate with any and all members of the Board of
Directors by transmitting correspondence to the following address or fax number:
Name of Director(s)
c/o Eric H. Brunngraber, Secretary
Cass Information Systems, Inc.
13001 Hollenberg Drive
Bridgeton, Missouri 63044
(314) 506-5560 (fax)
The Secretary will forward all correspondence to the Chairman of the Board
or the identified director as soon as practicable. Communications that are
abusive, in bad taste or that present a safety or security concern may be
handled differently. Correspondence addressed to the full Board will be
forwarded to the Chairman of the Board. As deemed necessary, the Chairman will
present the correspondence to the full Board or a committee thereof. If a
response to the communication is warranted, the content and method of the
response may be coordinated with the Company's legal counsel.
6
Executive Officers
The executive officers of the Company, their ages and their positions with
the Company and subsidiaries are set forth below. All officers serve at the
pleasure of the Company's Board of Directors.
Name Age Positions
---- --- ---------
Lawrence A. Collett 61 Chairman and Chief Executive Officer of
the Company and subsidiaries; Director
of the Company and subsidiaries
Eric H. Brunngraber 47 Chief Financial Officer and Vice
President-Secretary of the Company and
subsidiaries; Director of the Company
and subsidiaries
Harry M. Murray 50 Executive Vice President
John F. Pickering 53 Chief Operating Officer - Transportation
Information Services
Executive Compensation
The following table summarizes compensation to the Company's Chief
Executive Officer and all other executive officers of the Company for each of
the last three fiscal years.
Long Term Compensation
------------------------
Annual Compensation Restricted Securities
Name and ------------------- Stock, ($) Underlying All Other
Principal Position Year Salary Bonus Awards Options (#)* Compensation (1)
- ------------------ ---- ------ ----- ------ ------------ ----------------
Lawrence A. Collett 2003 $365,000 $ 60,900 $ 67,716(2) 9,029 $ 4,980
Chairman and 2002 341,000 58,000 -- -- 4,290
Chief Executive Officer 2001 316,000 56,700 -- -- 3,840
of the Company
and subsidiaries
Eric H. Brunngraber 2003 $181,600 $ 33,000 $ 22,275(3) 2,970 $ 3,450
Chief Financial Officer and 2002 156,600 29,000 -- -- 3,056
Vice President - Secretary 2001 126,600 25,500 -- -- 2,586
of the Company and
subsidiaries
Harry M. Murray 2003 $170,000 $ 30,500 $ 15,042(4) 1,818 $ 3,690
Executive Vice President 2002 150,000 21,000 -- -- 2,914
2001 140,000 14,700 -- -- 2,755
John F. Pickering 2003 $150,000 $ 24,000 -- -- $ 3,378
Chief Operating Officer - 2002 150,000 19,080 -- -- 3,168
Transportation Information 2001 166,500 14,500 -- -- 3,240
Services
* All share information has been restated to reflect the 10% stock dividend
declared by the Company in February 2004.
(1) These amounts represent Company matching contributions paid on behalf of the
executive under the Company's 401(k) Plan (in 2003 contributions were $3,000 for
Mr. Collett, $3,000 for Mr. Brunngraber, $3,000 for Mr. Murray, and $2,688 for
Mr. Pickering) and the imputed value of group term life premiums paid on their
behalves (in 2003 premiums were $1,980 for Mr. Collett, $450 for Mr.
Brunngraber, $690 for Mr. Murray, and $690 for Mr. Pickering).
(2) Represents the value of restricted stock awarded to Mr. Collett on January
21, 2003 for performance of the Company in 2002, pursuant to the terms of the
Company's 1995 Restricted Stock Bonus Plan. The value of restricted stock was
calculated by multiplying the number of shares awarded by the average of the
high and low market price of the Company's stock on the day prior to the date of
the award. Shares are subject to a three-year vesting schedule, with 1/3 of the
shares vesting each year on the anniversary date of the awards, beginning
January 21, 2004. Mr. Collett is entitled to vote and entitled to receive
dividends on these restricted shares. At December 31, 2003 the unvested
restricted stock holding of Mr. Collett consisted of 3,009 shares, with a value
of $90,589 based on the market value of the Company's shares at December 31,
2003.
7
(3) Represents the value of restricted stock awarded to Mr. Brunngraber on
January 21, 2003 for performance of the Company in 2002, pursuant to the terms
of the Company's 1995 Restricted Stock Bonus Plan. The value of restricted stock
was calculated by multiplying the number of shares awarded by the average of the
high and low market price of the Company's stock on the day prior to the date of
the award. Shares are subject to a three-year vesting schedule, with 1/3 of the
shares vesting each year on the anniversary date of the awards, beginning
January 21, 2004. Mr. Brunngraber is entitled to vote and entitled to receive
dividends on these restricted shares. At December 31, 2003 the unvested
restricted stock holding of Mr. Brunngraber consisted of 990 shares, with a
value of $29,799 based on the market value of the Company's shares at December
31, 2003.
(4) Represents the value of restricted stock awarded to Mr. Murray on April 15,
2003, pursuant to the terms of the Company's 1995 Restricted Stock Bonus Plan.
The value of restricted stock was calculated by multiplying the number of shares
awarded by the average of the high and low market price of the Company's stock
on the day prior to the date of the award. Shares are subject to a three-year
vesting schedule, with 1/3 of the shares vesting each year on the anniversary
date of the awards, beginning April 15, 2004. Mr. Murray is entitled to vote and
entitled to receive dividends on these restricted shares. At December 31, 2003
the unvested restricted stock holding of Mr. Murray consisted of 606 shares,
with a value of $18,244 based on the market value of the Company's shares at
December 31, 2003.
Option/SAR Grants in 2003
The following table summarizes options granted during 2003 to the
executive officers named above, together with estimates of the value of such
options at the end of their seven-year terms assuming the market value of the
Common Stock appreciates at an annual rate of 5% or 10%.
Percent of Potential Realizable
Number of Total Value at Assumed Annual
Securities Options Rates of Stock Price
Underlying Granted to Appreciation For
Options Employees Exercise Options Term
Granted in Fiscal Base Price Expiration ----------------------
(#)(*) Year ($/SH)(*) Date 5% ($) 10% ($)
---------- ---------- ---------- ---------- -------- --------
Mr. Collett 9,029 58% $22.500 2010 $179,277 $326,489
Mr. Brunngraber 2,970 19 22.500 2010 58,966 107,384
Mr. Murray 1,818 12 24.745 2010 32,018 61,661
* All share information has been restated to reflect the 10% stock dividend
declared by the Company in February 2004.
Options Exercised in 2003 and Year-end Option Values
The following table summarizes options exercised during 2003 and the
values of options outstanding on December 31, 2003, for the executive officers
named above.
Number of Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
Shares Fiscal Year-End Fiscal Year-End
Acquired on Value Exercisable/ Exercisable/
Exercise (#)* Realized ($) Unexercisable (#)* Unexercisable ($)(1)
------------- ------------ ------------------ --------------------
Mr. Collett 26,421 $507,923 664 / 37,240 $5,471 / $300,982
Mr. Brunngraber -- -- 1,173 / 11,036 9,441 / 86,639
Mr. Murray -- -- 66 / 7,526 552 / 56,760
Mr. Pickering -- -- 66 / 5,708 552 / 47,024
* All share information has been restated to reflect the 10% stock dividend
declared by the Company in February 2004.
(1) Based on the market value of the Company's common stock on the Nasdaq Stock
Market on December 31, 2003.
8
Defined Contribution Savings Plan
All full-time employees of the Company and subsidiaries are eligible to
participate in the Cass Information Systems, Inc. 401(k) Plan. Employees may
voluntarily defer up to 15% of pre-tax earnings subject to the IRS maximum
limitation, which was $12,000 for 2003. Voluntary deferrals contributed to the
401(k) Plan by the Executive officers are included in Annual Salary Compensation
in the Summary Compensation Table. The Company matches 50% of the first 3% of
employee contributions, subject to IRS limitations. Amounts contributed to the
Plan in 2003 for the benefit of the executive officers are included in Other
Compensation in the Summary Compensation Table. Each executive officer is fully
vested in Company contributions.
Defined Benefit Retirement Plans
Retirement Plan for Employees of Cass Information Systems, Inc.
All executive officers of the Company and subsidiaries are participants in
the Retirement Plan for Employees of Cass Information Systems, Inc., which
covers all full-time employees. Upon retirement, participants in the plan will
begin to receive monthly payments equal to one-twelfth of the sum of:
(a) .9% of Final Average Earnings multiplied by the number of
years of participation, plus
(b) .5% of Final Average Earnings in excess of Covered
Compensation multiplied by years of participation.
Final Average Earnings is defined as the average annual total compensation
for the five consecutive years of highest earnings during the last ten years of
employment. Covered Compensation is the average of the maximum social security
taxable wage bases in effect for each calendar year during the 35-year period
ending with the year in which retirement age is attained under the Social
Security Act. Earnings covered by the Plan equal total compensation as reported
in the Summary Compensation Table including any amounts deferred under the Cass
Information Systems, Inc. 401(k) Plan.
Normal retirement under the Plan commences at age 65. At normal retirement
the years of participation under the Plan for the executive officers listed in
the Compensation Table would be as follows: Mr. Collett-41; Mr. Brunngraber-41;
Mr. Murray-34; and Mr. Pickering-37.
The following table shows the estimated annual benefits payable at
retirement, assuming a straight-life annuity with 120 months guaranteed.
Estimated Annual Retirement Benefit (1)(2)
Final Years of Service Credited at Retirement
Average ---------------------------------------
Earnings 10 15 20 25 30 35 40
- --------------------------------------------------------------------------------------------------------
$ 125,000 $ 15,100 $ 22,600 $ 30,100 $ 37,700 $ 45,200 $ 52,800 $ 60,300
150,000 18,600 27,900 37,100 46,400 55,700 65,000 74,500
175,000 22,100 33,100 44,100 55,200 66,200 77,300 88,300
200,000 25,600 38,400 51,100 63,900 76,700 89,500 102,300
(1) Estimated benefit calculation assumes retirement at age 65 in the year
2005 with no increase in the maximum social security taxable wage base
after 2003.
(2) Estimated benefits would be subject to Internal Revenue Service maximum
retirement limitations in effect at the retirement date. The maximum
annual compensation that may be recognized for determining benefits in
2003 was $200,000.
9
Supplemental Executive Retirement Plan
In addition to the above defined benefit plan, in 1998 the Company
established the Cass Information Systems, Inc. Supplemental Retirement Plan,
which covers key executive officers of the Company. This supplemental plan was
designed to provide additional retirement benefits to key executives whose
benefits are limited by the Internal Revenue Service under the Company's
qualified plan.
Upon retirement, participants in the plan will receive monthly payments
equal to one twelfth of 70% of Final Average Earnings and reduced
proportionately for length of service less than 25 years and reduced by the
participant's: (a) Qualified retirement plan benefit, (b) Primary social
security benefit, and (c) 401(k) hypothetical annuity.
Final Average Earnings, normal retirement age and years of participation
at normal retirement are the same as under the Retirement Plan for Employees of
Cass Information Systems, Inc.
The following table shows the estimated annual benefits payable at
retirement, assuming a straight-life annuity with 120 months guaranteed.
Estimated Annual Retirement Benefit (1)
Final Years of Service Credited at Retirement
Average ---------------------------------------
Earnings 10 15 20 25 30 35 40
- --------------------------------------------------------------------------------------------------------
$ 125,000 $ -- $ -- $ 4,100 $ 14,000 $ 6,500 $ -- $ --
150,000 -- -- 8,200 19,900 10,600 1,300 --
175,000 -- -- 12,300 25,700 14,700 3,600 --
200,000 -- 3,400 18,700 33,900 21,100 8,300 --
300,000 26,500 45,400 74,700 103,900 91,100 78,300 65,500
400,000 54,500 87,400 130,700 173,900 161,100 148,300 135,500
(1) Estimated benefit calculation assumes retirement at age 65 in the year
2004.
10
Performance Quoted on The Nasdaq Stock Market for the last Five Fiscal Years
The following graph compares the cumulative total returns of the Company,
the Nasdaq Stock Market, and the Nasdaq Computer and Data Processing Stocks over
the last five fiscal years. The graph assumes that $100 was invested on December
31, 1998, with dividends reinvested. Returns are based on end of period prices.
Comparison of Cumulative Total Returns
Performance Quoted on The Nasdaq Stock Market for the last Five Fiscal Years
Cass Information Systems, Inc.
[PERFORMANCE CHART]
Nasdaq
Cass Nasdaq Computer and
Information Stock Data Processing
Systems, Inc. Market (US) Stocks
- ------------------------------------------------------------------------------------------
12/31/1998 12/31/1998 100.000 100.000 100.000
1/29/1999 100.000 114.503 120.902
2/26/1999 100.503 104.250 107.240
3/31/1999 100.772 112.122 120.611
4/30/1999 100.265 115.683 114.460
5/28/1999 99.759 112.432 111.699
6/30/1999 100.020 122.529 125.444
7/30/1999 100.020 120.317 117.975
8/31/1999 99.255 125.386 124.253
9/30/1999 104.927 125.529 130.631
10/29/1999 96.697 135.582 140.423
11/30/1999 89.496 152.015 163.310
12/31/1999 12/31/1999 84.040 185.428 219.990
1/31/2000 83.521 178.613 194.264
2/29/2000 85.077 212.670 230.223
3/31/2000 82.774 208.330 217.293
4/28/2000 88.013 175.216 166.506
5/31/2000 88.537 154.081 146.191
6/30/2000 87.799 181.135 177.313
7/31/2000 86.212 171.671 159.226
8/31/2000 82.298 191.960 179.439
9/29/2000 74.816 167.017 164.011
10/31/2000 73.747 153.291 150.101
11/30/2000 78.691 118.103 108.876
12/29/2000 12/29/2000 75.642 111.832 101.251
1/31/2001 96.714 125.375 117.071
2/28/2001 88.609 97.055 89.540
3/30/2001 80.192 83.408 73.862
4/30/2001 85.342 95.847 90.749
5/31/2001 86.847 95.742 90.899
6/29/2001 87.252 98.357 96.178
7/31/2001 88.177 92.108 84.396
8/31/2001 87.913 82.080 69.644
9/28/2001 93.566 68.247 58.826
10/31/2001 93.477 77.007 68.386
11/30/2001 105.050 87.970 77.581
12/31/2001 12/31/2001 109.980 88.710 81.535
1/31/2002 109.980 88.037 81.107
2/28/2002 112.562 78.882 73.087
3/30/2002 113.558 84.055 75.234
4/30/2002 112.224 77.073 63.694
5/31/2002 113.445 73.673 59.624
6/29/2002 113.577 67.001 59.794
7/31/2002 111.279 60.883 52.514
8/31/2002 104.911 60.238 52.777
9/28/2002 106.514 53.760 46.254
10/31/2002 107.342 61.104 55.913
11/30/2002 112.173 67.916 63.272
12/31/2002 12/31/2002 119.815 61.331 56.226
1/31/2003 123.712 60.668 54.972
2/28/2003 129.167 61.521 54.648
3/30/2003 128.846 61.698 54.780
4/30/2003 158.886 67.306 59.030
5/31/2003 129.582 73.216 62.138
6/29/2003 147.762 74.391 63.554
7/31/2003 144.275 79.518 65.766
8/31/2003 154.563 82.983 68.764
9/28/2003 164.108 81.904 69.375
10/31/2003 154.100 88.496 71.602
11/30/2003 149.196 89.809 71.162
12/31/2003 12/31/2003 165.982 91.702 74.078
11
Principal Shareholders
The following table contains information with respect to beneficial
ownership of the Company's outstanding common stock, as of March 5, 2004, by:
(1) each person known to the Company to be the beneficial owner of more than 5%
of common stock, (2) each director of the Company and (3) each executive officer
of the Company. All share information has been restated to reflect the 10% stock
dividend declared by the Company in February 2004. The address of each director
and executive officer is c/o Cass Information Systems, Inc., 13001 Hollenberg
Drive, Bridgeton, Missouri 63044. Unless otherwise indicated, the named person
has sole voting and investment rights with respect to such shares.
Name of Number of Shares Percent
Beneficial Owner Beneficially Owned of Class
- ---------------- ------------------ --------
Rutabaga Capital Management 228,953 (1) 6.22%
64 Broad Street, 3rd Floor Boston, MA 02109
Directors and Executive Officers:
Robert J. Bodine 98,741 (2) 2.68%
Eric H. Brunngraber 7,417 (3) *
Bryan S. Chapell 1,042 (4) *
Lawrence A. Collett 70,369 (5) 1.91
Thomas J. Fucoloro 676 (6) *
Wayne J. Grace 110 (7) *
Harry J. Krieg 59,105 (8) 1.61
Howard A. Kuehner 137,289 (9) 3.73
Harry M. Murray 11,339 (10) *
Jake Nania 397,742 (11) 10.81
John F. Pickering 10,851 (12) *
Irving A. Shepard 20,450 (13) *
Andrew J. Signorelli 129,663 (14) 3.52
Bruce E. Woodruff 8,200 (15) *
All directors and executive officers --------
as a group 952,994 25.90%
- ----------
* Less than 1% of class.
(1) Information with respect to the outstanding shares beneficially held by
Rutabaga Capital Management is based on Schedule 13G/A filed with the SEC
on February 4, 2004 by such firm.
(2) Includes 330 shares granted under the Company's 1995 Restricted Stock
Bonus Plan, which are subject to forfeiture; however, Mr. Bodine has
voting but no investment rights. Excludes 11,245 shares held in a trust as
to which Mr. Bodine's wife has sole voting and investment rights.
(3) Includes 3,192 shares owned jointly with his wife. Includes 1,526 shares
granted under the Company's 1995 Restricted Stock Bonus Plan, which are
subject to forfeiture; however, Mr. Brunngraber has voting but no
investment rights. Includes 2,698 shares Mr. Brunngraber has the right to
acquire under the 1995 Performance-Based Stock Option Plan.
(4) These shares are owned jointly with his wife. Includes 231 shares granted
under the Company's 1995 Restricted Stock Bonus Plan, which are subject to
forfeiture; however, Mr. Chapell has voting but no investment rights.
(5) Includes 33,721 shares owned jointly with his wife. Includes 4,429 shares
granted under the Company's 1995 Restricted Stock Bonus Plan, which are
subject to forfeiture; however, Mr. Collett has voting but no investment
rights. Includes 5,428 shares Mr. Collett has the right to acquire under
the 1995 Performance-Based Stock Option Plan.
12
(6) Includes 330 shares granted under the Company's 1995 Restricted Stock
Bonus Plan, which are subject to forfeiture; however, Mr. Fucoloro has
voting but no investment rights. Excludes 231 shares held in a trust as to
which Mr. Fucoloro's wife has sole voting and investment rights.
(7) Represents shares granted under the Company's 1995 Restricted Stock Bonus
Plan, which are subject to forfeiture; however, Mr. Grace has voting but
no investment rights. Excludes 550 shares owned by his wife.
(8) Includes 58,775 shares held in a trust with Mr. Krieg having shared voting
and investment rights. Includes 330 shares granted under the Company's
1995 Restricted Stock Bonus Plan, which are subject to forfeiture;
however, Mr. Krieg has voting but no investment rights. Excludes 59,148
shares owned by his wife.
(9) Includes 65,437 shares held in a trust with Mr. Kuehner having shared
voting and investment rights. Includes 330 shares granted under the
Company's 1995 Restricted Stock Bonus Plan, which are subject to
forfeiture; however, Mr. Kuehner has voting but no investment rights.
Excludes 123,569 shares owned by his wife.
(10) Includes 9,858 shares owned jointly with his wife. Includes 606 shares
granted under the Company's 1995 Restricted Stock Bonus Plan, which are
subject to forfeiture; however, Mr. Murray has voting but no investment
rights. Includes 875 shares Mr. Murray has the right to acquire under the
1995 Performance-Based Stock Option Plan.
(11) Includes 397,511 shares held in a trust with Mr. Nania having sole voting
and investment rights. Includes 231 shares granted under the Company's
1995 Restricted Stock Bonus Plan, which are subject to forfeiture;
however, Mr. Nania has voting but no investment rights.
(12) Includes 9,975 shares owned jointly with his wife. Includes 875 shares Mr.
Pickering has the right to acquire under the 1995 Performance-Based Stock
Option Plan.
(13) Includes 20,334 shares held in a family partnership in which Mr. Shepard
has shared voting and investment rights. Includes 115 shares granted under
the Company's 1995 Restricted Stock Bonus Plan, which are subject to
forfeiture; however, Mr. Shepard has voting but no investment rights.
(14) Includes 129,548 shares held in various trusts with Mr. Signorelli having
shared voting and investment rights. Includes 115 shares granted under the
Company's 1995 Restricted Stock Bonus Plan, which are subject to
forfeiture; however, Mr. Signorelli has voting but no investment rights.
(15) Includes 7,969 shares held in a trust with Mr. Woodruff having sole voting
and investment rights. Includes 231 shares granted under the Company's
1995 Restricted Stock Bonus Plan, which are subject to forfeiture;
however, Mr. Woodruff has voting but no investment rights.
Section 16(a) Beneficial Ownership Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of the registered class of the Company's equity securities, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission (SEC) and The Nasdaq Stock Market. Directors and executive officers
and greater than ten-percent shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file.
Based on its review of the copies of such forms received by it and written
representation from certain reporting persons that no Forms 5 were required for
those persons, the Company believes that during 2003 all filing requirements
applicable to its directors, executive officers, and greater than ten-percent
beneficial owners were complied with in a timely manner.
13
INDEPENDENT AUDITORS
KPMG LLP were the auditors of the Company during the year ended December
31, 2003 and also have been selected by the Audit Committee of the Board of
Directors to serve as auditors for the present year. KPMG LLP has served as the
Company's independent auditors since 1983.
A representative of KPMG LLP is expected to be present at the Meeting,
will have an opportunity to make a statement if he or she desires to do so, and
is expected to be available to respond to appropriate questions of Shareholders.
Fees Incurred For 2003 Services Performed by the Independent Auditors
For the years ended December 31, 2003 and 2002, the Company incurred the
following fees for services performed by KPMG LLP:
2003 2002
---- ----
Audit Fees (1)(3) $101,300 $101,850
Audit-related Fees - -
Taxes (2)(3) 69,745 74,200
All Other Fees (3) - 28,489 (4)
(1) The Audit Committee has considered whether the provision of these services
is compatible with maintaining the principal auditor's independence.
(2) Represents tax compliance and preparation services.
(3) 100% of these services were pre-approved by the Audit Committee.
(4) Represents services performed during an Information Technology Security
review.
It is the policy of the Audit Committee to pre-approve all non-audit
services provided by our independent auditors.
OTHER MATTERS
Management does not intend to present to the Annual Meeting any business
other than the items stated in the "Notice of Meeting of Shareholders" and does
not know of any matters to be brought before the Meeting other than those
referred to above. If, however, any other matters properly come before the
Meeting, the persons designated as proxies will vote on each such matter in
accordance with their best judgment.
SHAREHOLDER PROPOSALS
Any proposal to be presented at next year's Annual Meeting must be
received at the principal executive offices of the Company not later than
November 17, 2004. Any such proposals should be directed to the attention of the
Secretary for consideration for inclusion in the Company's Proxy Statement and
Form of Proxy relating to the next Annual Meeting. Any such proposals must
comply in all respects with the rules and regulations of the Securities and
Exchange Commission. The Company's Form of Proxy for next year's Annual Meeting
may permit the representatives named in the proxy to vote in their discretion on
any other shareholder proposal of which notice has not been given to the Company
by January 31, 2005. It is suggested that proponents of any proposals submit
such proposals to the Company sufficiently in advance of the deadline by
Certified Mail-Return Receipt Requested.
By Order of the Board of Directors
Eric H. Brunngraber
Secretary
14
Cass Information Systems, Inc. Exhibit I
Audit Committee Charter
The purpose of this charter is to set forth the objectives, composition, and
responsibilities of the Audit Committee of the Board of Directors (the
Committee) of Cass Information Systems, Inc. (the Company).
I. PURPOSE
The Audit Committee is appointed by the Board of Directors to assist in
fulfilling its oversight responsibilities of regulatory compliance,
corporate accounting and financial reporting practices of the Company and
each of its subsidiaries. In addition, the Committee will:
o Oversee and appraise the quality of the internal and external audit
processes;
o Maintain free and open means of communication between the Board of
Directors, the independent auditors, the internal auditors, and
management of the Company;
o Serve as an independent and objective party to monitor the integrity
of the financial information presented by management to
shareholders, regulators, and the general public;
o Review the adequacy of the Company's administrative, operating and
internal accounting controls, and the Company's compliance with the
letter and spirit of applicable Federal and state laws and
regulations.
II. COMPOSITION AND MEETINGS
The Committee will be comprised of at least three directors who are (1)
independent of the management of the Company, (2) receive no consulting,
advisory or other compensatory fees from the Company, other than
directors' fees, and (3) are free from any relationship that, in the
opinion of the Board of Directors, would interfere with their exercise of
independent judgement as a committee member.
All members of the Committee shall have a basic understanding of finance
and accounting and be able to read and understand fundamental financial
statements, and at least one member of the Committee shall have accounting
or related financial management expertise.
The Committee will hold at least four meetings per year and such
additional meetings as the Committee shall require in order to perform its
designated duties.
III. RESPONSIBILITIES AND DUTIES
Financial Reporting and Review
1. Review and assess the adequacy of this charter at least annually.
Submit the charter to the Board of Directors for approval and have
the document published at least every three years in accordance with
Securities and Exchange Commission regulations.
2. Review the annual audited financial statements with management and
the independent auditors prior to the Company filing its annual
report on Form 10-K, including any significant issues regarding
accounting principles, practices and judgements.
3. Review with management and the independent auditors the Company's
quarterly financial results prior to the Company filing its report
on Form 10-Q, or where practicable, prior to the first public
release of quarterly earnings.
1 of 3
Cass Information Systems, Inc. Exhibit I
Audit Committee Charter
4. Discuss any significant changes to the Company's accounting
principles and any items required to be communicated by the
independent auditors in accordance with Statement on Auditing
Standards No. 61 (SAS 61), Communication With Audit Committees.
5. Review with the independent auditors and management the Company's
"critical accounting policies," as defined by the SEC, including an
assessment regarding the adequacy of the Company's disclosures.
6. Discuss earnings releases, as well as financial information and
earnings guidance provided by the Company to analysts and ratings
agencies.
7. Receive and review reports from the internal auditors and the
independent auditors that assess the adequacy and effectiveness of
the Company's internal accounting control system; accounting
policies and procedures; and, financial and accounting management.
8. Review any disclosures provided by the CEO and the CFO to the
Committee regarding significant deficiencies in the design or
operation of internal controls which could adversely affect the
Company's ability to record, process, summarize, and report
financial data.
9. Review legal and regulatory matters that may have a material impact
on the financial statements, related Company compliance policies,
and programs and reports received from regulators.
10. Monitor management's response and actions taken to correct any
deficiencies noted by internal auditors, independent auditors or
regulatory agencies.
Independent and Internal Audit Oversight
11. Exercise sole authority in the selection and appointment of the
independent auditors that is ultimately accountable to the Committee
and the Board of Directors.
12. Exercise sole authority to approve the compensation of the
independent auditors.
13. Evaluate with the Board the performance and independence of the
independent auditors and, if so determined in the Committee's sole
authority, replace the independent auditors.
14. Ensure the rotation of the lead audit partner having responsibility
for the audit and the concurring review partner responsible for
reviewing the audit in accordance with applicable Nasdaq rules and
regulations and applicable laws, rules and regulations.
15. Review and concur in the appointment, replacement, or dismissal of
the internal auditors.
16. Assist in oversight of the internal auditors' responsibilities,
performance, and the adequacy of its resources to carry out its
responsibilities.
17. Consider the audit scopes and plans of the internal auditors and
independent auditors. Exercise sole authority to approve the terms
of all audit engagements of the independent auditors.
18. Review with the internal auditors and the independent auditors the
coordination of audit effort to assure completeness of coverage,
reduction of redundant efforts, and the effective use of audit
resources.
2 of 3
Cass Information Systems, Inc. Exhibit I
Audit Committee Charter
19. Annually, receive a formal, written statement from the independent
auditors consistent with standards set by Independence Standards
Board Standard No. 1, Independence Discussions with Audit
Committees. The Committee shall discuss with the independent
auditors and approve in advance any relationships or services that
may affect their objectivity or independence.
20. Annually prepare a report to shareholders as required by the
Securities and Exchange Commission. The report will be included in
the Company's annual proxy statement.
21. Maintain minutes of meetings and periodically report to the Board of
Directors on significant results of the foregoing activities.
22. Meet with the internal auditors, independent auditors and management
in private sessions to discuss any matters that the Committee or
these groups believe should be discussed privately with the
Committee.
23. Determine that there are no management restrictions placed on the
internal auditors or the independent auditors.
24. Conduct or authorize investigations into any matters within the
committee's scope of responsibilities, and perform such other
functions as assigned by law, the Company's by-laws, or the Board of
Directors.
25. Obtain advice, as deemed by the Committee to be necessary and
appropriate, from outside legal, accounting and other advisors.
26. Review the results of monitoring compliance with the Company's code
of business ethics and conduct.
27. Establish procedures for: (a) the receipt, retention and treatment
of complaints received by the Company regarding accounting, internal
accounting controls and auditing matters; and (b) the confidential,
anonymous submission by employees of the Company of concerns
regarding questionable accounting or auditing matters.
28. Review and approve all related-party transactions, as defined by the
SEC, with the exclusion of any and all transactions subject to
Regulation O issued by the Federal Reserve System.
The foregoing shall be the common activities of the Committee. These
functions are set forth as a guide with the understanding that the
Committee may diverge from this guide as deemed appropriate.
While the Committee has the responsibility and powers set forth in this
Charter, it is not the duty of the Committee to plan or conduct audits or
to determine that the Company's financial statements are complete and
accurate and in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent auditors.
3 of 3
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE Mark Here
FOLLOWING PROPOSAL: for Address |_|
Change or
Comments
1. Election of four directors to serve until the annual meeting in 2007, or
until their successors are elected and qualified.
FOR all nominees WITHHOLD
listed at right AUTHORITY
(except as marked to vote for all nominees
to the contrary) listed at right
|_| |_|
Nominees: 01 Lawrence A. Collett, 02 Wayne J. Grace, 03 Irving A. Shepard and
04 Andrew J. Signorelli
(INSTRUCTIONS: To withhold authority to vote for an individual nominee write
that nominee's name on the line below.)
________________________________________________________________________________
When properly executed and returned, this proxy will be voted in the manner
specified thereon, and in the best judgement of the Proxies on any other
business which properly comes before the meeting. If no manner is specified,
this proxy will be voted FOR the proposal.
Signature __________________ Date ______ Signature _________________ Date ______
Note: Please sign as your name appears hereon. If shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give your full name as such. If a corporation,
please sign in full corporate name by an authorized officer. If a partnership,
please sign in full partnership name by authorized person.
- --------------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
Vote by Internet or Telephone or Mail
24 Hours a Day, 7 Days a Week
Internet and telephone voting is available through 11:59 PM Eastern Time
the day prior to annual meeting day.
Your Internet or telephone vote authorizes the named proxies to vote your shares
in the same manner as if you marked, signed and returned your proxy card.
- ------------------------------------ -------------------------------- ----------------------
Internet Telephone Mail
http://www.eproxy.com/cass 1-800-435-6710 Mark, sign and date
Use the Internet to vote your proxy. Use any touch-tone telephone to your proxy card
Have your proxy card in hand when OR vote your proxy. Have your proxy OR and
you access the web site. card in hand when you call. return it in the
enclosed postage-paid
envelope.
- ------------------------------------ -------------------------------- ----------------------
If you vote your proxy by Internet or by telephone,
you do NOT need to mail back your proxy card.
CASS INFORMATION SYSTEMS, INC.
Solicited by the Board of Directors
The undersigned hereby constitutes and appoints Lawrence A. Collett and
Eric H. Brunngraber, and either of them, attorneys with full power of
substitution, with the powers the undersigned would possess if personally
present, to vote all shares of Common Stock of the undersigned in CASS
INFORMATION SYSTEMS, INC. at the Annual Meeting of Shareholders to be held at
11:00 a.m., April 19, 2004 and at any adjournments thereof on all matters
properly before the meeting.
(Continued and To Be Signed On Other Side.)
________________________________________________________________________________
Address Change/Comments (Mark the corresponding box on the reverse side)
________________________________________________________________________________
________________________________________________________________________________
- --------------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^