-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LvbxK/W41wqDJRr1xuYMMzoqtJ0gK5e1ALmWDFaLiIwCq+VVtyqnGXZjGvTpXKSu Cf7ZsqpVnXMPe34NUAuY7Q== 0001065407-04-000338.txt : 20040625 0001065407-04-000338.hdr.sgml : 20040625 20040625145643 ACCESSION NUMBER: 0001065407-04-000338 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031231 FILED AS OF DATE: 20040625 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CFS BANCORP INC CENTRAL INDEX KEY: 0001058438 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 332042093 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-24611 FILM NUMBER: 04881953 BUSINESS ADDRESS: STREET 1: 707 RIDGE ROAD CITY: MUNSTER STATE: IN ZIP: 46321 BUSINESS PHONE: 2198365500 MAIL ADDRESS: STREET 1: 707 RIDGE ROAD CITY: MUNSTER STATE: IN ZIP: 46321 11-K 1 form11k.txt FORM 11-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 __________________ FORM 11-K (Mark One): [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2003 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ___________ Commission file number: 0-24611 A. Full title of the plan and address of the plan, if different from that of the issuer named below: Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: CFS Bancorp, Inc. 707 Ridge Road Munster, Indiana 46371 REQUIRED INFORMATION Financial Statements. The following financial statements and schedule are filed as part of this annual report for the Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust (the "Plan"): Page No. -------- Report of Independent Registered Public Accounting Firm..............1 Financial Statements Statements of Net Assets Available for Benefits.................2 Statements of Changes in Net Assets Available for Benefits......3 Notes to Financial Statements...................................4 Supplemental Schedule Schedule H, Line 4 - Schedule of Assets (Held at End of Year)...9 Report of Independent Registered Public Accounting Firm Plan Administrators Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust We have audited the accompanying statements of net assets available for benefits of Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust (the Plan) as of December 31, 2003 and 2002, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2003 and 2002, and the changes in its net assets available for benefits for the years then ended, in conformity with U.S. generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2003, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole. /s/ Ernst & Young LLP May 25, 2004 1 Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Statements of Net Assets Available for Benefits December 31 2003 2002 ------------------------ Assets Investments, at fair value: CFS Bancorp, Inc. common stock $4,174,946 $4,591,630 Collective investment funds 5,606,826 3,977,353 Short-term investment fund 193,515 136,016 Participant loans 205,574 263,633 ------------------------- Total investments 10,180,861 8,968,632 Receivables: Employer's contribution 5,706 13,115 Participants' contributions 15,675 38,129 Dividends 31,030 32,109 Other 3,331 55,721 ------------------------- Total receivables 55,742 139,074 ------------------------- Total assets 10,236,603 9,107,706 Liabilities Accounts payable 4,795 42,158 ------------------------- Net assets available for benefits $10,231,808 $9,065,548 ========================= See notes to financial statements. 2 Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Statements of Changes in Net Assets Available for Benefits Year ended December 31, 2003 2002 ----------------------- Additions Contributions: Participants $ 742,352 $ 783,522 Employer 223,053 260,707 ---------------------- Total contributions 965,405 1,044,229 Investment income (loss): Dividend and interest income 145,411 158,885 Net realized and unrealized appreciation (depreciation) in fair value of investments 1,099,204 (550,735) ---------------------- Total investment income (loss) 1,244,615 (391,850) ---------------------- Total additions 2,210,020 652,379 Deductions Distributions to participants 992,760 855,105 Administrative expenses 51,000 48,308 ---------------------- Total deductions 1,043,760 903,413 ---------------------- Net increase (decrease) in assets available for benefits 1,166,260 (251,034) Net assets available for benefits at beginning of year 9,065,548 9,316,582 ----------------------- Net assets available for benefits at end of year $10,231,808 $9,065,548 ======================= See notes to financial statements. 3
Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Notes to Financial Statements December 31, 2003 and 2002 1. Description of the Plan The following description of the Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust (the Plan) is provided for general information purposes only. Participants should refer to the Plan document for more complete information. General The Plan, adopted by Citizens Financial Services, FSB (the Bank) on April 30, 1998, and effective on May 1, 1998, is a single employer defined-contribution plan. Effective March 1, 2000, the Suburban Federal Savings 401(k) Plan was merged into the Plan. Eligible participants of Suburban Federal Savings, FSB became participants in the Plan and were granted credit for certain prior service under the terms of the Plan for purposes of eligibility and vesting. The Plan allows all employees of the Bank and its subsidiaries to participate after meeting certain age and service requirements. To be eligible to participate in the Plan, an employee must have attained the age of 21 and completed 1,000 hours of service during a 12 consecutive month period. The Plan is subject to certain provisions of the Employee Retirement Income Security Act of 1974 (ERISA) and is intended to qualify as a salary reduction plan under Section 401(k) of the Internal Revenue Code, as amended by the Tax Reform Act of 1986 (the Code). Contributions The Bank contributes and allocates to each participant's account the amount withheld from each participant's compensation (employee contributions) pursuant to his or her elective deferral agreement and within a range specified by the Plan. The Bank matches 50% of each participant's contributions to the Plan up to the first 6% of each participant's compensation. The Employer may make discretionary contributions to the Plan. Upon enrollment, participants may direct their contributions, and related matching contributions, in any of the Plan's investment options. 4 Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Notes to Financial Statements (continued) 1. Description of the Plan (continued) Participant Accounts Each participant's account is credited with the participant's contribution, the Bank's matching contribution, and an allocation of Plan earnings and is charged with an allocation of administrative expenses. Plan earnings from each investment fund option are allocated to participants based on their proportionate share of total assets in that investment fund option. Vesting Participants immediately vest in both their employee contributions and the Bank's matching contributions and any related earnings thereon. Payment of Benefits Payment of benefits to a participant who terminates employment or becomes disabled may be made in a lump sum, in annual installments over a specified period, or rolled into another qualified plan. A participant also may elect to defer distribution of his or her account until attaining age 70 1/2. Payment of benefits to the beneficiary of a deceased participant may also be made in the form of a lump-sum payment, annual installments over a specified period, or rolled into another qualified plan. Participant Loans Under the Plan, participants may borrow up to one-half of their account balance in any amount between $1,000 and $50,000. The rate of interest for the term of the loan will be established as of the loan date and shall be a reasonable rate of interest generally comparable to the rates of interest then in effect at a major banking institution. The repayment period is between 1 and 15 years for loans used exclusively for the purchase of a primary residence or 1 and 5 years for all other loans, at the participant's option. Repayments are made through payroll deductions. When a loan is made, the amount borrowed is transferred from the participant's deposit account to the participant's loan account. An origination fee of $50.00, plus an annual administrative fee of $40.00 is deducted from the participant's account at the time the loan is originated. Subsequent annual administrative fees will be deducted from the participant's account each year on or about the anniversary of the loan origination. Loan repayments, including interest, are immediately invested in the participant's deposit account. 5 Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Notes to Financial Statements (continued) 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires the plan administrator to make estimates that affect amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. Reclassifications Certain reclassifications have been made to the 2002 financial statements to conform to the 2003 presentation. Investment Valuation and Income Recognition The Plan's investments are stated at fair value. Collective investment funds are valued at quoted market prices, which represent the net asset value of shares held by the Plan at year-end. The common stock is valued at its quoted market price. Participant notes receivable are valued at cost, which approximates fair value. Purchases and sales of investments are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the declaration date. Payment of Benefits Benefits are recorded when paid. 3. Investments In conjunction with the Bank's conversion from a mutual to a stock form of ownership, the Plan utilized existing funds to purchase common stock of CFS Bancorp, Inc., the Bank's Holding Company (the Company). At the date of conversion, the Plan purchased 307,232 shares of stock at $10.00 per share for participants indicating a desire to purchase stock in the Company. Additional employee and Bank contributions and cash dividends are utilized to purchase additional shares on a regular basis. At December 31, 2003 and 2002, the Plan was the beneficial owner of 282,091 shares and 321,093 shares of Company common stock, respectively. The fair value of this stock at December 31, 2003 and 2002 was $14.80 per share and $14.30 per share, respectively. 6 Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Notes to Financial Statements (continued) 3. Investments (continued) During 2003 and 2002, the Plan's investments (including investments purchased, sold as well as held during the year) appreciated (depreciated) in fair value as determined by quoted market prices as follows: Year ended December 31, 2003 2002 ----------------------- CFS Bancorp, Inc. common stock $ 122,331 $ (28,126) Collective investment funds 976,873 (522,609) ----------------------- $ 1,099,204 $ (550,735) ======================= The fair value of individual investments that represent 5% or more of the Plan's net assets is as follows: 2003 2002 --------------------- CFS Bancorp, Inc. common stock $4,174,946 $4,591,630 Pentegra S&P 500 Stock Fund 1,632,813 1,190,989 Pentegra S&P Midcap Stock Fund 1,271,230 869,433 Pentegra Stable Value Fund 954,207 822,408 4. Plan Termination Although it has not expressed any intent to do so, the Bank has the right under the Plan to discontinue its contribution at any time and to terminate the Plan, subject to the provisions of ERISA. 5. Income Tax Status The Plan has received a determination letter from the Internal Revenue Service (IRS) dated December 2, 2003, stating that the Plan is qualified under Section 401 (a) of the Code, and, therefore, the related trust is exempt from taxation. The Plan was amended subsequent to the IRS determination letter. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The Plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code, and therefore believes that the Plan, as amended, is qualified and the related trust is tax-exempt. 7 Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Notes to Financial Statements (continued) 6. Subsequent Event Effective January 1, 2004, the Bank amended the eligibility requirements of the Plan. An employee may contribute to the Plan after completing 250 hours of service during a three consecutive month period. An employer match begins after completing 1,000 hours of service during a 12 consecutive month period. The employee still must have attained the age of 21 to be eligible to participate. 8 Supplemental Schedule EIN 13-3381592 Plan #002 Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust Schedule H, Line 4i - Schedule of Assets (Held at End of Year) December 31, 2003 Identity of Issue, Borrower, Current or Similar Party Description Value - ------------------------------------------------------------------------------ CFS Bancorp, Inc. common stock* 282,091 Shares $ 4,174,946 Pentegra S&P 500 Stock Fund 106,303 Units 1,632,813 Pentegra S&P Midcap Stock Fund 58,744 Units 1,271,230 Pentegra Stable Value Fund 64,801 Units 954,207 Pentegra Money Market Fund 358,308 Units 358,308 Pentegra Russell 2000 Stock Fund 24,763 Units 338,259 Pentegra Government Bond Fund 12,572 Units 220,258 Collective Short Term Investment Fund 193,515 Units 193,515 Pentegra 500 Growth Stock Fund 22,687 Units 186,259 Pentegra International Stock Fund 9,772 Units 172,867 Pentegra Growth Asset Allocation Fund 11,480 Units 152,686 Pentegra Growth & Income Asset Allocation Fund 9,908 Units 140,792 Pentegra 500 Value Stock Fund 12,248 Units 128,356 Pentegra Income Plus Asset Allocation Fund 3,496 Units 50,791 Participant loans (interest rates of 5.0% to 10.5%) 205,574 ---------- $10,180,861 ========== *Denotes party in interest. SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees for the Plan have duly caused this annual report to be signed by the undersigned hereunto duly authorized. CITIZENS FINANCIAL SERVICES, FSB EMPLOYEES' SAVINGS & PROFIT SHARING PLAN AND TRUST June 24, 2004 By: /s/ Thomas F. Prisby ---------------------------------- Thomas F. Prisby Plan Administrator INDEX TO EXHIBITS Number Description ------ -------------------------------------------------------- 23 Consent of Independent Registered Public Accounting Firm EX-23 2 ex23.txt ERNST & YOUNG LLP CONSENT Exhibit 23 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-62053) pertaining to the Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust of our report dated May 25, 2004, with respect to the financial statements and schedule of Citizens Financial Services, FSB Employees' Savings & Profit Sharing Plan and Trust included in this Annual Report (Form 11-K) for the year ended December 31, 2003. /s/ Ernst & Young LLP Chicago, Illinois June 24, 2004 -----END PRIVACY-ENHANCED MESSAGE-----