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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
- --------------------------------------------------------------------------------
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
For the fiscal year ended DECEMBER 31, 2004. Commission File Number 000-27894
COMMERCIAL BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
- --------------------------------------------------------------------------------
OHIO 34-1787239
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
118 S. SANDUSKY AVENUE, UPPER SANDUSKY, OHIO 43351
(Address of principal executive offices including zip code)
Registrant's telephone number, including area code: (419) 294-5781
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
TITLE OF EACH CLASS
none
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
TITLE OF EACH CLASS
Common Shares, no par value
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days. Yes [-] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in the Securities Exchange Act of 1934 Rule 12b-2). Yes [ ] No [-]
At June 30, 2004, the aggregate market value of voting stock held by
non-affiliates of the registrant, based on a share price of $26.00 per share
(such price being the last sale price on that date, and there being 1,127,498
non-affiliated, voting shares outstanding) was $29,314,948.
At March 1, 2005, there were issued and outstanding 1,172,518 of the
registrant's Common Shares.
DOCUMENTS INCORPORATED BY REFERENCE
PORTIONS OF THE REGISTRANT'S 2004 ANNUAL REPORT TO SHAREHOLDERS ARE INCORPORATED
BY REFERENCE INTO PARTS I AND II OF THIS FORM 10-K. PORTIONS OF THE REGISTRANT'S
PROXY STATEMENT DATED MARCH 17, 2005 FOR THE APRIL 13, 2005 ANNUAL MEETING OF
SHAREHOLDERS ARE INCORPORATED BY REFERENCE INTO PART III OF THE FORM 10-K.
INDEX
FORM 10-K
Page
----
PART I
ITEM 1. Description of Business 3
ITEM 2. Properties 5
ITEM 3. Legal Proceedings 6
ITEM 4. Submission of Matters to a Vote of Security Holders 6
PART II
ITEM 5. Market for Common Equity Related Shareholder Matters and Issuer
Purchases of Equity Securities 6
ITEM 6. Selected Financial Data 6
ITEM 7. Management's Discussion and Analysis of Financial Condition
and Results of Operation 6
ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk 6
ITEM 8. Financial Statements and Supplementary Data 7
ITEM 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 7
ITEM 9A. Controls and Procedures 7
ITEM 9B. Other Information 7
PART III
ITEM 10. Directors and Executive Officers of the Registrant 7
ITEM 11. Executive Compensation 7
ITEM 12. Security Ownership of Certain Beneficial Owners and Management 8
ITEM 13. Certain Relationships and Related Transactions 8
ITEM 14. Principal Accountant Fees and Services 8
PART IV
ITEM 15. Exhibits and Financial Statement Schedules 9
SIGNATURES 10
INDEX TO EXHIBITS 11
2
PART I
ITEM 1 - DESCRIPTION OF BUSINESS
GENERAL
In February 1995, Commercial Bancshares, Inc. (the "Corporation") received
approval from the Board of Governors of the Federal Reserve System to become a
bank holding company by acquiring all the voting shares of common stock of The
Commercial Savings Bank (the "Bank"). The principal business of the Corporation
presently is to operate the Bank, which is a wholly owned subsidiary, and its
principal asset. The Corporation and the main office of the Bank are located at
118 South Sandusky Avenue, Upper Sandusky, Ohio 43351. In May 1997, the Board of
Directors approved the establishment of the Corporation's second wholly owned
subsidiary, a consumer finance company, and thereby chartered a new Ohio
corporation by the name of "Advantage Finance, Inc." (the "Finance Company"). On
December 24, 1997, approval was granted by the Ohio Division of Financial
Institutions (the "Division") for the Finance Company to do business in Ohio. On
April 10, 1998 the Finance Company opened for business at 117 North Greenwood,
Marion, Ohio providing small consumer loans to customers in the Marion area. In
January 1999, the Corporation received regulatory approval from the Division to
establish the Finance Company as a subsidiary of the Bank to facilitate its
future operations. Finance Company offices were added in Marion and Findlay
during 2000 and 2001. During the year 2001, the Corporation elected to file to
be a Financial Services Holding Company, and received approval having met all
additional capital requirements. On December 23, 2003, Articles of Incorporation
were filed for Commercial Financial and Insurance Agency, LTD ("Commercial
Financial"), an Ohio limited liability company. This company, which did not
operate in 2003, is a subsidiary of the Corporation and was formed to enable the
Corporation to expand the products and services available to current customers
and others to include the sales of non-deposit investment products and other
selected financial and insurance products and services. Activity in this new
affiliate started during the third quarter of 2004, but had very little effect
on the year's performance.
Although wholly owned by the Corporation, the Bank functions as an independent
community bank. The Bank was organized on April 20, 1920 as a state-chartered
Bank and incorporated as "The Lewis Bank & Trust Corporation" under the laws and
statutes of the State of Ohio. An amendment to the articles of incorporation on
February 8, 1929 changed the name of the Bank to its present name. The Bank
provides customary retail and commercial banking services to its customers,
including acceptance of deposits for demand, savings and time accounts and
servicing of such accounts; commercial, consumer and real estate lending,
including installment loans, individual retirement accounts (IRA's), safe
deposit facilities and night depository facilities. The Bank is a nonmember of
the Federal Reserve System, is insured by the Federal Deposit Insurance
Corporation (FDIC) and is regulated by the Division and the FDIC.
The Bank grants residential, installment and commercial loans to customers
located primarily in the Ohio counties of Wyandot, Marion, Hancock, and Franklin
and the surrounding area. Commercial loans are primarily variable rate and
include operating lines of credit and term loans made to small businesses
primarily based on the ability to repay the loan from the cash flow of the
business. Such loans are typically secured by business assets, such as equipment
and inventory, and occasionally by the business owner's personal residence. When
the borrower is not an individual, the Bank generally obtains the personal
guarantee of the business owner. Commercial real estate loans are primarily
secured by borrower-occupied business real estate, and are dependent on the
ability of the related business to generate adequate cash flow to service the
debt. Such loans primarily carry adjustable interest rates. Residential real
estate loans are made with primarily variable rates and are secured by the
borrower's residence. Such loans are made based on the borrower's ability to
make repayment from employment and other income. The Bank generally makes these
loans in amounts of 80% or less of the value of collateral. An appraisal is
obtained from a qualified real estate appraiser for substantially all loans
secured by real estate. Construction loans are secured by residential and
business real estate that primarily will be borrower-occupied upon completion.
The Bank usually does not make the permanent loan at the end of the construction
phase, unless the customer accepts a variable rate mortgage. Installment loans
to individuals include loans secured by automobiles and other consumer assets,
including second mortgages on personal residences. Loans secured by automobiles
are generated both by direct application from the customer and from the Bank's
purchase of indirect retail installment contracts from the dealers. Most of the
indirect installment business now flows through the Finance Company subsidiary.
Credit card and overdraft protection loans are unsecured personal lines of
credit to individuals. The Finance Company
3
specializes in direct and indirect lending for consumer goods, 90-day and
six-month same-as-cash loans, second mortgage, and installment loans. The Bank
entered into a business relationship during 2000 whereby the Bank obtained an
ownership interest in Beck Title Agency, Ltd. of Carey, Ohio ("Beck Title").
This joint venture provides an additional source of fee income for title
research activity on new home loan originations in the local market.
The general economic conditions in the Corporation's market area have generally
been consistent with the nation as a whole. Unemployment statistics have
generally been consistent with the State of Ohio as a whole and real estate
values have been stable. The Corporation is not aware of any exposure to
material costs associated with environmental hazardous waste cleanup. Bank loan
procedures require that state and federal environmental regulatory studies be
obtained by Bank management before approving any commercial real estate loan
where such potential risk is considered likely to exist.
COMPETITION IN FINANCIAL SERVICES
The Bank, the Finance Company, Commercial Financial, and Beck Title compete for
business in the Ohio counties of Wyandot, Hancock, Marion, and Franklin. The
Corporation's competitors for business come from two primary sources: large
regional firms and independent community banks and thrifts. The Finance Company
competes with both national and regional finance companies by bidding on
businesses with national networks of dealers. The Bank also competes,
particularly for deposit dollars, with insurance companies, brokerage firms and
investment companies. The Bank finds that it competes favorably with the large
regional banks through its ability to maintain decision-making officers within
branch locations rather than centralizing decision-making in a corporate
headquarters. Competition with the independent community banks is enhanced by
creating product niches so as not to resort solely to pricing as a means to
attract business. Examples of the Bank's product niches include small
tractor/riding mower financing, small-business lending and low-fee demand
deposit accounts. The Finance Company has found a niche in indirect financing of
retail consumer goods from regional retailers.
EMPLOYEES
Currently the Bank has 113 full-time employees and 25 part-time employees. The
Finance Company has 9 full-time employees. Officers of the Corporation are also
employees of the Bank and have been included in these totals.
SUPERVISION AND REGULATION
The Corporation, as a financial holding company, is regulated under the Bank
Holding Company Act of 1956, as amended (the BHC Act), and is subject to the
supervision and examination of the Board of Governors of the Federal Reserve
System (the Federal Reserve Board). The BHC Act requires the prior approval of
the Federal Reserve Board for a financial holding company to acquire or hold
more than a 5% voting interest in any bank. The BHC Act allows interstate bank
acquisitions anywhere in the country and interstate branching by acquisition and
consolidation in those states that have not opted out by January 1, 1997.
Other than as described below with respect to activities that are "financial in
nature", the Corporation is generally prohibited by the BHC Act from acquiring
direct or indirect ownership or control of more than five percent of the voting
shares of any company which is not a bank or bank holding company and from
engaging directly or indirectly in activities other than those of managing or
controlling banks or furnishing services to its subsidiaries.
On November 12, 1999, the Gramm-Leach-Bliley Act (the "GLB Act") was enacted
into law. The GLB Act made sweeping changes with respect to the permissible
financial services which various types of financial institutions may now
provide. The Glass-Steagall Act, which had generally prevented banks from
affiliation with securities and insurance firms, was repealed. Pursuant to the
GLB Act, bank holding companies may elect to become a "financial holding
company," provided that all of the depository institution subsidiaries of the
bank holding company are "well capitalized" and "well managed" under applicable
regulatory standards.
Under the GLB Act, a bank holding company that has elected to become a financial
holding company may affiliate with securities firms and insurance companies and
engage in other activities that are financial in nature. Activities that are
"financial in nature" include securities underwriting, dealing and
market-making, sponsoring mutual
4
funds and investment companies, insurance underwriting and agency, merchant
banking, and activities that the Federal Reserve Board has determined to be
closely related to banking. The Corporation has elected to be a financial
holding company.
The Bank is subject to limitations with respect to transactions with affiliates.
A substantial portion of the Corporation's cash revenues is derived from
dividends paid by the Bank. These dividends are subject to various legal and
regulatory restrictions.
The Bank is subject to primary supervision, regulation and examination by the
Ohio Division of Financial Institutions (the "Division") and the Federal Deposit
Insurance Corporation (FDIC).
Federal regulators adopted risk-based capital guidelines and leverage standards
for banks and financial holding companies. A discussion of the impact of
risk-based capital guidelines and leverage standards is presented in Note 13 of
the Commercial Bancshares, Inc. financial statements included in its Annual
Report, which is incorporated herein by reference.
The Financial Reform, Recovery and Enforcement Act of 1989 (FIRREA) provides
that a holding company's controlled insured depository institutions are liable
for any loss incurred by the Federal Deposit Insurance Corporation in connection
with the default of any FDIC-assisted transaction involving an affiliated
insured bank or savings association.
Noncompliance with laws and regulations by financial holding companies and banks
can lead to monetary penalties or an increased level of supervision or a
combination of these two items. Management is not aware of any current instances
of noncompliance with laws and regulations and does not anticipate any problems
maintaining compliance on a prospective basis. Recent regulatory inspections and
examinations of the Corporation and the Bank have not disclosed any significant
instances of noncompliance. The minor instances of noncompliance detected during
these inspections and examinations were promptly corrected by management and no
action was taken by the regulators against the Corporation or the Bank.
The earnings and growth of the Corporation are affected not only by general
economic conditions, but also by the fiscal and monetary policies of the federal
government and its agencies, particularly the Federal Reserve Board. Its
policies influence the amount of bank loans and deposits and the interest rates
charged and paid thereon, and thus have an effect on earnings. The nature of
future monetary policies and the effect of such policies on the future business
and earnings of the Corporation and Bank cannot be predicted.
REGULATION OF THE FINANCE COMPANY: The Finance Company is chartered in the State
of Ohio and regulated by the Division, the FDIC, and the Federal Reserve Board.
These regulatory agencies have the authority to examine the books and records of
the Finance Company and the Finance Company is subject to their rules and
regulations.
The following schedules present, for the periods indicated, certain financial
and statistical information of the Corporation as required under the Securities
and Exchange Commission's Industry Guide 3, or a specific reference as to the
location of required disclosures in the Corporation's 2004 Annual Report to
Shareholders (the "Annual Report"), which is included as Exhibit 13 to this
document and incorporated herein by reference.
STATISTICAL DISCLOSURES
The following statistical information for 2004, 2003, and 2002, included in the
Annual Report is incorporated herein by reference.
Pages of Annual Report
----------------------
Distribution of Assets, Liabilities and Shareholders, Equity;
Interest Rates and Interest Differential 6-7
Investment Portfolio 14
Loan Portfolio 10-11
Summary of Loan Loss Experience 11-14
Deposits 15
5
Return on Equity and Assets 2
ITEM 2 - PROPERTIES
The Corporation's headquarters and the Bank's main office are located at 118
South Sandusky Avenue, Upper Sandusky, Ohio, in Wyandot County. The building is
used exclusively by the Corporation and the Bank. All of the offices listed
below are owned by the Bank or the Finance Company, except the branch inside the
WalMart located at 2500 Tiffin Avenue in Findlay, Ohio, and are free and clear
of any encumbrances.
Location Description
- ---------------------------------- --------------------------------------------
1. Main Office Two story building built in the early 1900's
118 S. Sandusky Ave. and remodeled in 1991.
Upper Sandusky, Ohio 43351
2. Carey Office One story building built and opened in 1973.
128 S. Vance Street
Carey, OH 43316
3. Harpster Office One story building purchased in 1978.
17480 Cherokee Street
Harpster, OH 43323
4. North Drive-In Office One story drive in office opened in 1981.
400 N. Sandusky Avenue
Upper Sandusky, OH 43351
5. Marion Barks Road Office One story building purchased, renovated,
170 Barks Road East and opened in 1988.
Marion, OH 43302
6. Findlay Tiffin Avenue Office One story building purchased in 1992. The
1600 Tiffin Avenue building was renovated in 1999 to add
Findlay, OH 45840 more office space.
7. Marion Jamesway Office One story building constructed and opened
279 Jamesway in 1996.
Marion, OH 43302
8. Bellefontaine Office One story building purchased, renovated,
1245 Bellefontaine Ave. and opened in 1999.
Marion, OH 43302
9. Findlay Lincoln Street Office One story building purchased in 1999 and
201 Lincoln Street opened in 2000.
Findlay, OH 45840
10. Westerville Office Two story building purchased in 2000 and
17 N. State Street opened in 2001.
Westerville, OH 43081
11. WalMart Office Located inside the store with leased square
2500 Tiffin Avenue footage opened in 2001.
Findlay, OH 45840
12. Advantage Finance Main Street Two story building purchased and opened
141 S. Main Street in 2000.
Marion, OH 43301
The Bank considers its physical properties to be in good operating condition
(subject to reasonable wear and tear) and suitable for the purposes for which
they are being used. The Bank ceased operations at its Richwood, Ohio branch
office on November 1, 2004. The branch was never able to attain the level of
business activity normally associated with profitable branches as the vast
majority of town residents preferred doing business with the locally-owned
community bank. The office building was immediately sold to a local dentist for
a small net profit.
ITEM 3 - LEGAL PROCEEDINGS
There is no pending litigation, other than routine litigation incidental to the
business of the Corporation, Bank,
6
Finance Company, or Commercial Financial of a material nature involving or
naming the Corporation, Bank, Finance Company, or Commercial Financial as a
defendant. Further, there are no material legal proceedings in which any
director, officer, principal shareholder, affiliate of the Corporation, or
security holder owning five percent of the Corporation's common stock; or any
associates of such persons is a party or has a material interest that is adverse
to the Corporation, Bank, Finance Company, or Commercial Financial. None of the
routine litigation in which the Corporation, Bank, Finance Company, or
Commercial Financial is involved is expected to have a material adverse impact
on the financial position or results of operations of the Corporation, Bank,
Finance Company, or Commercial Financial.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of security holders during the fourth quarter
of 2004.
PART II
ITEM 5 - MARKET FOR COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
The information set forth under the heading "Shareholder Information" on page 43
of the Annual Report is incorporated herein by reference.
The following table reflects shares repurchased by the Corporation during the
fourth quarter, 2004. These shares were purchased as part of a program approved
by the Corporation's Board of Directors in June, 2002. The Corporation has no
publicly announced stock repurchase plans or programs.
TOTAL AVERAGE MAXIMUM NUMBER OF
NUMBER PRICE TOTAL NUMBER OF SHARES THAT MAY YET
OF SHARES PAID PER SHARES PURCHASED AS BE PURCHASED UNDER
PERIOD PURCHASED SHARE PART OF THE PLAN THE PLAN
December, 2004 4,574 $ 26.52 15,954 63,784
All shares were purchased in open-market transactions. The plan provides for a
maximum repurchase of 10% of the Corporation's common stock outstanding as of
the date of the plan's approval over a period of five years. Shares not
purchased of each year's 2% allocation are no longer considered for purchase as
each anniversary date is reached.
ITEM 6 - SELECTED FINANCIAL DATA
The information set forth under the heading "Comparative Summary of Selected
Financial Data" on page 2 of the Annual Report is incorporated herein by
reference.
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION
The information set forth under the heading "Management's Discussion and
Analysis of Financial Condition and Results of Operations" on pages 3 through
18, inclusive, of the Annual Report is incorporated herein by reference.
7
ITEM 7A - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The information set forth under the heading "Quantitative and Qualitative
Disclosures about Market Risk" on pages 18 through 19 of the Annual Report is
incorporated herein by reference.
ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information contained in the consolidated financial statements and related
notes and the report of independent auditors thereon, on pages 23 through 43,
inclusive, of the Annual Report is incorporated herein by reference.
ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
There were no disagreements between the Corporation and its independent
accountants on accounting and financial disclosures.
ITEM 9A - CONTROLS AND PROCEDURES
Commercial Bancshares, Inc. carried out an evaluation, under the supervision and
with the participation of its management, including its Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and operation of
the Corporation's disclosure controls and procedures as of December 31, 2004,
pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, the Chief
Executive Officer and Chief Financial Officer concluded that the Corporation's
disclosure controls and procedures were effective as of December 31, 2004, in
timely alerting them to material information relating to the Corporation
(including its consolidated subsidiaries) required to be in the Corporation's
periodic SEC filings.
ITEM 9B - OTHER INFORMATION
None.
PART III
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information concerning Directors and Executive Officers of the Corporation
appears on pages 2, 3, 4, 6 through 11 inclusive and page 18 under the captions
"Board and Committee Membership", "Committees of the Board", "Information
relating to Nominees and other Directors", "Executive Officers", "Report of the
Audit Committee of the Board of Directors", and "Section 16(a) Beneficial
Ownership Reporting Compliance" in the Corporation's Definitive Proxy Statement
dated March 17, 2005 for the Annual Meeting of Shareholders to be held on April
13, 2005 and is incorporated herein by reference.
The Corporation has adopted a code of ethics that applies to its principal
executive officer, principal financial officer, and principal accounting
officer. A copy of the Corporation's Code of Ethics may be viewed on the
Corporation's website, www.csbanking.com. In the event we make any amendment to,
or grant any waiver of, a provision of our code of ethics, we intend to disclose
such amendment or waiver, the reasons for it, and the nature of any waiver, the
name of the person to whom it was granted, and the date, on our internet
website.
ITEM 11 - EXECUTIVE COMPENSATION
Information concerning executive compensation appears on pages 4 and 12 through
14 and 16, under the captions "Compensation of Directors", "Compensation
Committee Interlocks and Insider Participation", "Executive Compensation",
"Deferred Compensation Plan", "Stock Option Plan", "Supplemental Executive
Retirement Plan", and "Aggregated Option Exercises in Last Fiscal Year and
FY-End Option Values", in the Corporation's Definitive Proxy Statement dated
March 17, 2005 for the Annual Meeting of Shareholders to be held on April 13,
2005 and is incorporated herein by reference.
8
ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
Information concerning security ownership of certain beneficial owners and
management is contained on pages 2 and 6 through 9 under the captions "Voting
Securities and Principal Holders Thereof", "Information Relating to Nominees and
other Directors", and "Share Ownership of Management and Directors" in the
Corporation's Definitive Proxy Statement dated March 17, 2005 for the Annual
Meeting of Shareholders to be held on April 13, 2005 and is incorporated herein
by reference.
The following table includes information as of December 31, 2004 with respect to
the 1997 Commercial Bancshares, Inc. Stock Option Plan, under which equity
securities of the Corporation are authorized for issuance. The Corporation has
no other compensation plans under which equity securities of the Corporation are
authorized for issuance.
Number of securities
remaining available for
Number of securities to be Weighted-average future issuance under
issued upon exercise of exercise price of equity compensation
outstanding options, outstanding options, plans (excluding securities
Plan category warrants and rights warrants and rights reflected in column(a))
- -------------------- -------------------------- -------------------- --------------------------
(a) (b) (c)
Equity Compensation
plans approved by
security holders 35,567 $ 25.1346 76,138
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information concerning certain relationships and related transactions is
contained on page 5 under the caption "Related Transactions" in the
Corporation's Definitive Proxy Statement dated March 17, 2005 for the Annual
Meeting of Shareholders to be held on April 13, 2005 and is incorporated herein
by reference.
ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES
Information concerning principal accountant fees and services is contained on
pages 11, 12, 18 and 19 under the captions "Report of the Audit Committee of the
Board of Directors", "Principal Accounting Firm Fees" and "Relationship with
Independent Registered Public Accountants" of the Corporation's Definitive Proxy
Statement dated March 17, 2005 for the Annual Meeting of Shareholders to be held
on April 13, 2005 and is incorporated herein by reference.
9
ITEM 15 - EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) The following Consolidated Financial Statements and related Notes to
Consolidated Financial Statements, together with the reports of
Independent Registered Public Accounting Firms dated March 7, 2005 and
February 7, 2003, appear on pages 21 through 43 of the Commercial
Bancshares, Inc. 2004 Annual Report and are incorporated herein by
reference.
1. Financial Statements
Consolidated Balance Sheets
December 31, 2004 and 2003
Consolidated Statements of Income for the Years Ended
December 31, 2004, 2003 and 2002
Consolidated Statements of Shareholders' Equity for the Years Ended
December 31, 2004, 2003 and 2002
Consolidated Statements of Cash Flows for the Years Ended
December 31, 2004, 2003 and 2002
Notes to Consolidated Financial Statements for the Years Ended
December 31, 2004, 2003 and 2002
Reports of Independent Registered Public Accounting Firms
Financial statement schedules are omitted as they are not required
or are not applicable or because the required information is
included in the consolidated financial statements or notes thereto.
(b) EXHIBITS
Exhibit Number Description of Document
- -------------- ---------------------------------------------------------------------------
3.1 Amended Articles of Incorporation of the Corporation
(incorporated by reference to Registrant's Form 8-K dated April 27, 1995)
3.2 Code of Regulations of the Corporation
(incorporated by reference to Registrant's Form 8-K dated April 27, 1995)
4 Form of Certificate of Common Shares of the Corporation
(incorporated by reference to Registrant's Form 8-K dated April 27, 1995)
10.1 Commercial Bancshares, Inc. 1997 Stock Option Plan
(incorporated by reference to Appendix II to our Proxy Statement, as filed
with the SEC on Schedule 14A on March 13, 1997)
10.2 Commercial Bancshares, Inc. Deferred Compensation Plan
(incorporated by reference to Exhibit 4.1 to our Registration Statement on
Form S-8, as filed with the SEC on March 17, 1999)
10.3 Commercial Bancshares Supplemental Executive Retirement Plan
10.4 Executive Employment Contract, dated as of March 31, 2004, between Tracy
Morgan and Advantage Finance, Inc.
13 Annual Report to Shareholders for the Year Ended 2004
10
21 Subsidiaries of the Registrant
23.1 Consent of Plante & Moran, PLLC
23.2 Consent of Crowe, Chizek and Company, LLP
31.1 Certification by CEO Pursuant to Sarbanes Oxley Section 302
31.2 Certification by CFO Pursuant to Sarbanes Oxley Section 302
32.1 Certification by CEO Pursuant to Sarbanes Oxley Section 906
32.2 Certification by CFO Pursuant to Sarbanes Oxley Section 906
All of such previously filed documents are hereby incorporated by reference in
accordance with Item 601 of Regulation S-K. Such documents are available to
shareholders without charge upon request from the Issuer.
11
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the under signed, thereunto
duly authorized.
03/28/2005 COMMERCIAL BANCSHARES, INC.
Date
By: /s/ PHILIP W. KINLEY
-----------------------------------
Philip W. Kinley, President and CEO
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities indicated on
March 31, 2005.
Signatures Signatures
- ----------------------------------------- -------------------------------
/s/ PHILIP W. KINLEY /s/ EDWIN G. EMERSON
- ----------------------------------------- -------------------------------
Philip W. Kinley Edwin G. Emerson
President and Principal Executive Officer Director
/s/ JOHN C. HALLER /s/ HAZEL FRANKS
- ----------------------------------------- -------------------------------
John C. Haller Hazel Franks
Senior Vice President and Chief Financial Director
Officer
/s/ RICHARD SHEAFFER /s/ DEBORAH J. GRAFMILLER
- ----------------------------------------- -------------------------------
Richard Sheaffer Deborah J. Grafmiller
Director, Chairman of the Board Director
/s/ DANIEL E. BERG /s/ KURT D. KIMMEL
- ----------------------------------------- -------------------------------
Daniel E. Berg Kurt D. Kimmel
Director Director
/s/ J. WILLIAM BREMYER /s/ MICHAEL A. MASTRO
- ----------------------------------------- -------------------------------
J. William Bremyer Michael A. Mastro
Director Director
/s/ LYNN R. CHILD /s/ MICHAEL A. SHOPE
- ----------------------------------------- -------------------------------
Lynn R. Child Michael A. Shope
Director Director
/s/ MARK DILLON /s/ DOUGLAS C. SMITH
- ----------------------------------------- -------------------------------
Mark Dillon Douglas C. Smith
Director Director
12
INDEX TO EXHIBITS
Exhibit Number Description of Document
- -------------- --------------------------------------------------------------------------
3.1 Amended Articles of Incorporation of the Corporation
(incorporated by reference to Registrant's Form 8-K dated April 27, 1995)
3.2 Code of Regulations of the Corporation
(incorporated by reference to Registrant's Form 8-K dated April 27, 1995)
4 Form of Certificate of Common Shares of the Corporation
(incorporated by reference to Registrant's Form 8-K dated April 27, 1995)
10.1 Commercial Bancshares, Inc. 1997 Stock Option Plan
(incorporated by reference to Appendix II to our Proxy Statement, as filed
with the SEC on Schedule 14A on March 13, 1997)
10.2 Commercial Bancshares, Inc. Deferred Compensation Plan
(incorporated by reference to Exhibit 4.1 to our Registration Statement on
Form S-8, as filed with the SEC on March 17, 1999)
10.3 Commercial Bancshares Supplemental Executive Retirement Plan
10.4 Executive Employment Contract, dated as of March 31, 2004, between Tracy
Morgan and Advantage Finance, Inc.
13 Annual Report to Shareholders for the Year Ended 2004
21 Subsidiaries of the Registrant
23.1 Consent of Plante & Moran, PLLC
23.2 Consent of Crowe, Chizek and Company, LLP
31.1 Certification by CEO Pursuant to Sarbanes Oxley Section 302
31.2 Certification by CFO Pursuant to Sarbanes Oxley Section 302
32.1 Certification by CEO Pursuant to Sarbanes Oxley Section 906
32.2 Certification by CFO Pursuant to Sarbanes Oxley Section 906
13