-----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, TUe5QudfBOGFjlC82DNCjWiqQeFguPIVH1eJG8Aw8p4zYpktnQnQXkTVk4ZqjPY9 svSz1Mde9vArekJC8RM57w== 0000948688-97-000005.txt : 19970414 0000948688-97-000005.hdr.sgml : 19970414 ACCESSION NUMBER: 0000948688-97-000005 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970514 FILED AS OF DATE: 19970411 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: MIDSOUTH BANCORP INC CENTRAL INDEX KEY: 0000745981 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 721020809 STATE OF INCORPORATION: LA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-11826 FILM NUMBER: 97578816 BUSINESS ADDRESS: STREET 1: 102 VERSAILLES BLVD CITY: LAFAYETTE STATE: LA ZIP: 70501 BUSINESS PHONE: 3182378343 MAIL ADDRESS: STREET 1: 102 VERSAILLES BLVD CITY: LAFAYETTE STATE: LA ZIP: 70501 DEF 14A 1 SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 Filed by the Registrant [X] Filed by a Party other than the Registrant [ ] Check the appropriate box: [ ] Preliminary Proxy Statement [ ] Confidential, for Use of [X] Definitive Proxy Statement Commission Only (as [ ] Definitive Additional Materials permitted by Rule 14a- [ ] Soliciting Material Pursuant to 6(e)(2)) to par 240.14a-11(c) or par. 240.14a-12 MidSouth Bancorp, Inc. ________________________________________________ (Name of Registrant as Specified In Its Charter) Board of Directors of MidSouth Bancorp, Inc. ________________________________________________ (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of Filing Fee (Check the appropriate box): [X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or item 22(a)(2) of Schedule 14A. [ ] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. 1) Title of each class of securities to which transaction applies: 2) Aggregate number of securities to which transaction applies: 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): 4) Proposed maximum aggregate value of transaction: 5) Total Fee Paid: [ ] 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: 2) Form, Schedule or Registration Statement No.: 3) Filing Party: 4) Date Filed: c:\sally\wp\inv-rela\share97a.wpd MIDSOUTH BANCORP, INC. 102 Versailles Boulevard Versailles Centre Lafayette, Louisiana 70501 NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 14, 1997 Lafayette, Louisiana April 11, 1997 The annual meeting of shareholders of MidSouth Bancorp, Inc. ("MidSouth") will be held on Wednesday, May 14, 1997 at 2:00 p.m., local time, at MidSouth's main office, 102 Versailles Boulevard, Lafayette, Louisiana to vote upon: 1. The election of directors. 2. MidSouth's 1997 Stock Incentive Plan. 3. Such other matters as may properly come before the meeting or any adjournments thereof. Only holders of record of common stock at the close of business on March 31, 1997 are entitled to notice of and to vote at the meeting. Your vote is important regardless of the number of shares you own. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE MARK, DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE. YOUR PROXY MAY BE REVOKED BY APPROPRIATE NOTICE TO MIDSOUTH'S SECRETARY AT ANY TIME PRIOR TO THE VOTING THEREOF. BY ORDER OF THE BOARD OF DIRECTORS Karen L. Hail Secretary MIDSOUTH BANCORP, INC. 102 Versailles Boulevard Versailles Centre Lafayette, Louisiana 70501 PROXY STATEMENT This Proxy Statement is furnished holders of common stock of MidSouth Bancorp, Inc. ("MidSouth") in connection with the solicitation on behalf of its Board of Directors (the "Board") of proxies for use at MidSouth's annual shareholders meeting (the "Meeting") to be held on Wednesday, May 14, 1997 at the time and place shown in the accompanying notice and at any adjournments thereof. This Proxy Statement is first being mailed to shareholders about April 11, 1997. Only holders of record of MidSouth common stock ("Common Stock") at the close of business on March 31, 1997 are entitled to notice of and to vote at the Meeting. On that date, MidSouth had outstanding 1,379,589 shares of Common Stock plus any shares issued on conversion of its Preferred Stock from March 21 through March 31, 1997, each of which is entitled to one vote. The presence, in person or by proxy, of a majority of the outstanding shares of Common Stock entitled to vote is necessary to constitute a quorum. If a quorum is present, directors are elected by plurality vote and approval of MidSouth's 1997 Stock Incentive Plan (the "Plan") is determined by the vote of a majority of the voting power present at the Meeting. With respect to any other proposal that may properly come before the Meeting, MidSouth's Articles of Incorporation ("Articles") provide that if the Board has recommended it by the affirmative vote of the majority of the Continuing Directors, as defined in the Articles, then, generally, the affirmative vote of a majority of the votes cast is required to approve it, but if it is not so recommended, then the affirmative vote of 80% of the Total Voting Power, as defined in the Articles, is required to approve it. MidSouth's By-laws provide that the Continuing Directors will appoint the Judge(s) of Election and that all questions as to the qualification of voters, validity of proxies and the acceptance or rejection of votes will be decided by the Judge(s). Abstentions or broker non-votes will have no effect on the election of directors. With respect to any other proposal, abstentions will be counted as votes not cast and will have the effect of a vote against the proposal to approve the Plan and any other proposal requiring an affirmative vote of a percentage of the voting power present. Broker non-votes with respect to a particular matter will be treated as shares not voted and not present with respect to such matter, and will thus have no effect on the proposal to approve the Plan or any other proposal requiring a percentage of the voting power present but will have the effect of a vote against any proposal requiring an affirmative vote of a percentage of the Total Voting Power. All proxies received in the form enclosed will be voted as specified and, in the absence of instructions to the contrary, will be voted for the election of the nominees named herein and for the proposal to approve the Plan. MidSouth does not know of any matters to be presented at the Meeting other than those described herein; however, if any other matters properly come before the Meeting or any adjournments thereof, it is the intention of the persons named in the enclosed proxy to vote the shares represented by them in accordance with their best judgment. The enclosed proxy may be revoked by the shareholder at any time prior to its exercise by filing with MidSouth's Secretary a written revocation or a duly executed proxy bearing a later date. A shareholder who votes in person at the Meeting in a manner inconsistent with a proxy previously filed on his or her behalf will be deemed to have revoked the proxy as to the matters voted upon in person. The cost of soliciting proxies in the enclosed form will be borne by MidSouth. In addition to the use of the mails, proxies may be solicited by personal interview, telephone, telegraph, facsimile and e-mail. Banks, brokerage houses and other nominees or fiduciaries may be requested to forward the soliciting material to their principals and to obtain authorization for the execution of proxies, and MidSouth will, upon request, reimburse them for their expenses in so acting. ELECTION OF DIRECTORS MidSouth's Articles provide that the number of directors will be set by the By-laws, which currently provide for a Board of eight persons. The Articles also provide for three classes of directors, with one class to be elected at each annual meeting for a three-year term. At the Meeting, Class I Directors will be elected to serve until the third succeeding annual meeting and until their successors have been duly elected and qualified. Unless authority is withheld, the persons named in the enclosed proxy will vote the shares represented by the proxies received by them for the election of the three Class I director nominees named below. In the unanticipated event that one or more nominees cannot be a candidate at the Meeting, the shares represented will be voted in favor of such other nominees as may be designated by the Board. Directors will be elected by plurality vote. MidSouth's Articles provide that only persons nominated in accordance with the procedures in Article IV(H) of the Articles are eligible for election as directors. Other than the Board, only shareholders entitled to vote for the election of directors who have complied with these procedures may nominate a person for election. For such shareholder to do so, he or she must have given written notice to MidSouth by January 16, 1997 of the following: (1) as to each person whom he or she proposes to nominate, (a) the nominee's name, age, business address, residential address, principal occupation or employment, and the class and number of shares of MidSouth's stock of which her or she is the beneficial owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934 ("Rule 13d-3") and (b) any other information relating to the nominee that would be required to be disclosed in solicitations of proxies for the election of directors by Regulation 14A under the Securities Exchange Act of 1934 (the "Exchange Act"); and (2) as to the shareholder giving the notice, (a) his or her name and address and the class and number of shares of stock of MidSouth of which he or she is the beneficial owner (as defined in Rule 13d-3) and (b) a description of any agreements, arrangements or relationships between the shareholder and each person he or she proposes to nominate. Two inspectors, not affiliated with MidSouth, appointed by MidSouth's Secretary, will determine whether the notice provisions were met; if they determine that the shareholder has not complied with Article IV(H), the defective nomination will be disregarded. The following table sets forth certain information as of March 25, 1997 with respect to each director nominee and each director whose term as a director will continue after the Meeting. Unless otherwise indicated, each person has been engaged in the principal occupation shown for the past five years. The Board recommends a vote FOR each of the three nominees named below.
Director Nominees for terms expiring in 2000 (Class I Directors) Year First Name Age Principal Occupation Became Director ____ ___ ____________________ _______________ C. R. Cloutier 50 President and C.E.O., 1984 MidSouth and MidSouth National Bank (the "Bank"), the wholly- owned subsidiary of MidSouth J. B. Hargroder, M.D. 66 Physician, retired 1984 William M. Simmons 63 Private Investments 1984
Directors whose terms expire in 1998 (Class II Directors) Year First Became Name Age Principal Occupation Director ____ ___ ____________________ __________ Will G. 49 President, Acadiana Fast 1985 Charbonnet, Sr. Foods Inc. (owner/operator fast food stores); Chairman of the Board, MidSouth and the Bank Clayton Paul 71 President, Badger Oil 1992 Hilliard Corporation
Directors whose terms expire in 1999 (Class III Directors) Year First Became Name Age Principal Occupation Director ____ ___ ____________________ __________ James R. Davis, Jr. 44 Owner, Davis/Wade 1991 Financial Services, LLC (1995-Present); Owner, Safe-America Security System, Baton Rouge, LA (1994 -1995); Director of Gas Supply for La., Victoria Gas Corporation (1992 - 1993); President, Elsbury Production, Inc. (1982-1992) Karen L. Hail 43 Chief Financial Officer 1988 and Secretary, MidSouth Milton B. Kidd, 48 Optometrist, Kidd Vision 1996 III, O.D. Centers
Mr. Hilliard also served on the boards of MidSouth and the Bank from 1985 to 1987. Dr. Kidd, III has served on the board of the Bank since April 1, 1994. _____________________ During 1996, the Board held 14 meetings. Each incumbent director attended at least 75% of the aggregate number of meetings held during 1996 of the Board and committees of which he or she was a member. The Board has an Executive Committee, an Audit and Loan Review Committee and a Personnel Committee. The members of the Executive Committee are Messrs. Charbonnet, Cloutier and Hargroder. The Committee's duties include nominations, shareholder relations, Bank examination and Securities and Exchange Commission ("SEC") reporting. The Committee will consider nominees that are proposed by shareholders in accordance with the procedures, described above, in MidSouth's Articles. The Committee did not meet in 1996 as matters usually taken up by it were brought to the full Board. The members of the Audit and Loan Review Committee are Messrs. Davis, Kidd, and Hilliard. The Committee, which held 12 meetings in 1996, is responsible for maintaining a program of internal accounting controls and monitoring all loans and lines of credit for consistency with the Bank's loan policy. The members of the Personnel Committee are Messrs. Charbonnet, Davis, Hargroder, Hilliard, Kidd, III, and Simmons. The Committee, which met 3 times in 1996, is responsible for evaluating the performance and setting the compensation of MidSouth's executive officers. Directors of MidSouth are also directors of the Bank. Directors are entitled to fees of $200 per month for service on both boards, except for the Chairman of the Board, who receives an additional $400 per month. Each director also receives $250 for each regular meeting, and $125 for each special meeting, of the Board of the Bank and $100 for the first hour, and $50 per hour for each additional hour, of each committee meeting. Directors receive fees only for meetings they attend. Section 16(a) of the Exchange Act requires MidSouth's directors, executive officers and ten percent shareholders to file with the SEC initial reports of ownership and reports of changes in ownership of equity securities of MidSouth. Executive officers, directors and ten-percent shareholders are required to furnish MidSouth with copies of all the reports they file. To MidSouth's knowledge, based on a review of reports furnished to MidSouth, all required reports were filed on a timely basis. SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS Security Ownership of Management The following table sets forth certain information as of March 25, 1997 concerning the beneficial ownership of MidSouth's equity securities, consisting of Common Stock and Series A Convertible Preferred Stock, by each director and nominee of MidSouth, by its Chief Executive Officer and Chief Financial Officer (who are also directors), and by all directors and executive officers as a group, determined in accordance with Rule 13d-3. Unless otherwise indicated, the securities are held with sole voting and investment power. The table reflects shares of Common Stock beneficially owned, and the footnotes provide information on beneficial ownership of Preferred Stock. Amount and Nature of Beneficial Percent Name and Address Ownership of Class ________________ __________ _______ Will G. Charbonnet, Sr. 73,297 5.31 % C. R. Cloutier 84,400 6.11% James R. Davis, Jr. 29,132 2.11% Karen L. Hail 24,393 1.76 % J. B. Hargroder, M.D. 135,506 9.80 % Clayton Paul Hilliard 62,909 4.55 % Milton B. Kidd, III, O.D. 60,449 4.38 % William M. Simmons 47,127 3.41 % All directors and 548,979 39.07 % executive officers as a group (13 persons) __________________________
Common Stock held by MidSouth's Directors' Deferred Compensation Trust (the "Trust") is beneficially owned by its Plan Administrator, MidSouth's Executive Committee, the members of which could be deemed to share beneficial ownership with respect to all Common Stock held in the Trust (96,656 shares or 7.0% as of March 25, 1997). For each director, the table includes the number of shares held for his or her account only, while the group figure includes all shares held in the Trust at March 25, 1997. Common Stock held by MidSouth's Employee Stock Ownership Plan (the "ESOP") is not included in the table, except that shares allocated to an individual's account are included as beneficially owned by that individual. Shares which may be acquired on conversion of Preferred Stock are deemed outstanding for purposes of computing the percentage of outstanding Common Stock owned by persons beneficially owning such shares and by all directors and executive officers as a group but are not otherwise deemed to be outstanding. Includes 15,791 shares as to which he shares voting and investment power and 12,668 shares held for his account in the Trust. Mr. Charbonnet's address is 1003 Hugh Wallis Road, South, Suite F, Lafayette, Louisiana 70508. Includes 14,758 shares held by the ESOP for his account, 42,808 shares as to which he shares voting and investment power and 15,072 shares held for his account in the Trust. Mr. Cloutier's address is P. O. Box 3745, Lafayette, Louisiana 70502. Includes 6,851 shares as to which he shares voting and investment power and 10,019 shares held for his account in the Trust. Includes 10,950 shares held for her account in the ESOP, 372 shares as to which she shares voting and investment power, and 9,890 shares held for her account in the Trust. Includes 118,256 shares as to which he shares voting and investment power, 13,619 shares held for his account in the Trust and 1,362 shares he has the right to acquire on conversion of 1,756 shares of Preferred Stock owned by him. Dr. Hargroder's address is P. O. Box 1049, Jennings, Louisiana 70546. Includes 55,623 shares as to which he shares voting and investment power, and 5,765 shares held for his account in the Trust. Includes 22,488 shares as to which he shares voting and investment power and 3,041 shares held for his account in the Trust. Includes 1,333 shares as to which he shares voting and investment power and 13,059 shares held for his account in the Trust. ____________________ Security Ownership of Certain Beneficial Owners The following table sets forth certain information as of March 25, 1997 concerning the only person other than the persons listed in the table above known to MidSouth to be the beneficial owner of more than five percent of its Common Stock, determined in accordance with Rule 13d-3.
Name and Address Shares Beneficially Percent of Beneficial Owner Owned of Class ___________________ ___________________ ________ MidSouth Bancorp, Inc. 144,810 10.49% Employee Stock Ownership Plan, ESOP Trustees and ESOP Administrative Committee P. O. Box 3745 Lafayette, LA 70502
The Administrative Committee directs the Trustees how to vote the approximately 15,212 unallocated shares of Common Stock in the ESOP as of March 25, 1997. Voting rights of the shares allocated to ESOP participants' accounts are passed through to them. The Trustees have investment power with respect to the ESOP's assets, but must exercise it in accordance with an investment policy established by the Administrative Committee. The Trustees are Donald R. Landry, an executive officer of MidSouth, and Russell Henson and Kim Cormier, Bank employees. The Administrative Committee consists of Teri S. Stelly, an executive officer of MidSouth, and Dailene Melancon, a Bank employee. ______________________ PROPOSAL TO APPROVE THE MIDSOUTH BANCORP, INC. 1997 STOCK INCENTIVE PLAN General The Board believes that the growth of MidSouth depends significantly upon the efforts of its directors, officers and other key employees and that such individuals are best motivated to put forth maximum effort on behalf of MidSouth if they own an equity interest in MidSouth. In accordance with this philosophy, in February, 1997, the Board unanimously adopted MidSouth's 1997 Incentive Compensation Plan (the "Plan") and has directed that the Plan be submitted for approval by the shareholders at the Meeting. Officers and other key employees will be eligible to receive awards ("Incentives") under the Plan when designated by the Personnel Committee, which administers the Plan. Incentives may be granted in any one or a combination of the following forms: (a) incentive and non-qualified stock options, (b) stock appreciation rights, (c) restricted stock, (d) performance shares, (e) stock awards, and (f) cash awards. MidSouth currently has 7 employees who participate in the Plan. In addition, the Plan automatically grants options to non- employee directors of MidSouth. See "Options to Non-Employee Directors." General Purposes of the Proposal The Board has determined to maintain a compensation system that includes, to a significant extent, grants of equity-based incentive awards. The Board believes that providing directors and key personnel with a proprietary interest in the growth and performance of MidSouth is crucial to stimulating individual performance while enhancing shareholder value. The Board further believes that the Plan will assist MidSouth in attracting, retaining and motivating directors and key personnel in a manner that is tied to the interests of shareholders. Shares Issuable through the Plan. A total of eight percent of the shares of Common Stock of MidSouth outstanding from time to time are authorized to be issued under the Plan. Proportionate adjustments will be made to the number of shares of Common Stock subject to the Plan in the event of any recapitalization, stock dividend, stock split, combination of shares or other change in the Common Stock. The Committee may also amend the terms of any Incentive to the extent appropriate to provide participants with the same relative rights before and after the occurrence of such an event. Shares of Common Stock subject to Incentives that are cancelled, terminated or forfeited, or shares of Common Stock that are issued as Incentives and forfeited or reacquired by MidSouth, will again be available for issuance under the Plan. On March 25, 1997, the closing sales price for a share of Common Stock, as reported on the American Stock Exchange, was $11.25. Administration of the Plan. The Committee administers the Plan and has plenary authority to award Incentives under the Plan, to interpret the Plan, to establish any rules or regulations relating to the Plan that it determines to be appropriate, to delegate its authority as appropriate, and to make any other determination that it believes necessary or advisable for the proper administration of the Plan. Amendments to the Plan. The Board may amend or discontinue the Plan at any time. However, MidSouth anticipates that any amendment that would materially increase the benefits under the Plan, materially increase the number of securities that may be issued under the Plan or materially modify the eligibility requirements, will be submitted to the holders of Common Stock for their approval. Except in limited circumstances, no amendment or discontinuance may change or impair any previously granted Incentive without the consent of the recipient thereof. Types of Incentives. The Committee will be authorized under the Plan to grant stock options, restricted stock, stock appreciation rights, performance shares, stock awards and cash awards, each of which is described below. Stock Options. The Committee may grant non-qualified stock options or incentive stock options to purchase shares of Common Stock. The Committee will determine the number and exercise price of the options to employees, and the time or times that the options become exercisable, provided that the option exercise price may not be less than the fair market value of the Common Stock on the date of grant. The term of an option will also be determined by the Committee, provided that the term of an incentive stock option may not exceed 10 years. The Committee may approve the purchase by MidSouth of an unexercised stock option from the optionee by mutual agreement for the difference between the exercise price and the fair market value of the shares covered by such option. The option exercise price may be paid in cash, in shares of Common Stock, in a combination of cash and shares of Common Stock, through a broker-assisted exercise arrangement or in such other manner as may be authorized by the Committee. If an optionee exercises an option while employed by MidSouth or a subsidiary and pays the exercise price with previously owned shares of Common Stock, the Committee may grant to the optionee an additional option to purchase the same number of shares as were surrendered at an exercise price equal to the fair market value of the Common Stock on the date of grant. Incentive stock options will be subject to certain additional requirements necessary in order to qualify as incentive stock options under Section 422 of the Internal Revenue Code (the "Code"). Restricted Stock. Shares of Common Stock may be granted by the Committee to an eligible employee and made subject to restrictions regarding their sale, pledge or other transfer by the employee for a specified period (the "Restricted Period"). All shares of restricted stock will be subject to such restrictions as the Committee may designate in an agreement with the employee, including, among other things, that the shares are required to be forfeited or resold to MidSouth in the event of termination of employment. Subject to the restrictions provided in the participant's agreement and the Plan, a participant receiving restricted stock will have all of the rights of a shareholder as to such shares. Stock Appreciation Rights. A stock appreciation right, or "SAR," is a right to receive, without payment to MidSouth, a number of shares of Common Stock, cash or any combination thereof, the amount of which is determined by the Committee. A SAR may be granted in conjunction with a stock option or alone without reference to any stock option. A SAR granted in conjunction with a stock option may be granted concurrently with the grant of such option or at such later time as determined by the Committee and as to all or any portion of the shares subject to the option. The Plan confers on the Committee discretion to determine the number of shares to which a SAR will relate as well as the duration and exercisability terms of a SAR. In the case of a SAR granted with respect to a stock option, the number of shares of Common Stock to which the SAR pertains will be reduced in the same proportion that the holder exercises the related option. Unless otherwise provided by the Committee, a SAR will be exercisable for the same time period as any stock option to which it relates. Upon exercise of a SAR, the holder is entitled to receive an amount equal to the aggregate amount of the appreciation in the shares of Common Stock as to which the SAR is exercised. For this purpose, the "appreciation" in the shares consists of the amount by which the fair market value of the shares of Common Stock on the exercise date exceeds (a) in the case of a SAR related to a stock option, the purchase price of the shares under the option or (b) in the case of a SAR granted alone without reference to a related stock option, an amount determined by the Committee at the time of grant. The Committee may pay the amount of this appreciation to the holder of the SAR by the delivery of Common Stock, cash, or any combination of Common Stock and cash. Performance Shares. Performance Shares consist of the grant by MidSouth to an eligible participant of a contingent right to receive shares of Common Stock or cash with or without any payment by the participant. Each performance share will be subject to the achievement of performance objectives by MidSouth, a business unit, a department or a subsidiary by the end of or within a specified period. The number of shares granted and the performance criteria will be determined by the Committee. The award of performance shares will not create any rights in a participant as a shareholder of MidSouth until the issuance of shares of Common Stock with respect to an award. Performance shares may be awarded in conjunction with the grant of dividend equivalent payment rights that entitle a participant to receive an amount equal to the cash dividends paid on an equal number of shares of Common Stock during the period beginning on the date of grant of an award and ending on the date on which the award is paid or forfeited. Stock Awards. Shares of Common Stock may be awarded by MidSouth to an eligible participant as a stock award. The number of shares awarded pursuant to any stock award will be determined by the Committee. Cash Awards. A cash award may be made by MidSouth to an eligible participant as additional compensation for services provided to MidSouth. Payment may depend on the achievement of specified performance objectives by MidSouth or the individual or may relate to the tax obligation imposed on a participant as the result of the grant, vesting or exercise of another Incentive. The amount of any monetary payment constituting a cash award will be determined by the Committee. Termination of Employment. If a participant ceases to be an employee, of MidSouth for any reason, including death, any Incentive may be exercised, will vest or will expire at such time or times as may be determined by the Committee in the Incentive agreement with the participant. Loans to Participants. The Committee may authorize the extension of a loan to a participant by MidSouth to cover the participant's tax liability that arises in connection with an Incentive. The terms of the loan will be determined by the Committee. Change of Control. If (a) MidSouth is not the survivor in a merger, consolidation or other reorganization, (b) it sells, leases or exchanges all or substantially all of its assets, (c) it is to be dissolved or liquidated, (d) any person or entity, other than an employee benefit plan of MidSouth or a related trust, acquires or gains control of more than 30% of its outstanding shares of Common Stock or (e) in connection with a contested election of directors, the persons who were directors of MidSouth before the election no longer are a majority of the Board (collectively, "corporate changes"), all outstanding Incentives will automatically become exercisable and vested, all performance criteria will be waived, and the Committee will have authority to take several actions regarding outstanding Incentives. Within certain time periods, it may (i) require that all outstanding options and SARs remain exercisable only for a limited time, after which they will terminate, (ii) require the surrender of some or all outstanding options and SAR's in exchange for a cash or Common Stock payment for each option or SAR equal in value to the per share change of control value, calculated as described on the Plan, over the exercise price, (iii) make any equitable adjustment to outstanding Incentives as it deems necessary to reflect the corporate change or (iv) provide that an option or SAR shall become an option or SAR relating to the number and class of shares of stock or other securities or property (including cash) to which the participant would have been entitled in connection with the corporate change if he or she had been the holder of record of the number of shares of Common Stock then covered by such options or SARs. The Board believes that providing the Committee with the choices outlined above will permit the Committee to review all relevant tax, accounting and other issues relating to the treatment of outstanding Incentives at the time of the corporate change, and thereby enable the Committee to choose the treatment that will best serve the participants and MidSouth. Although the automatic vesting of Incentives and the actions permitted to be taken by the Committee in the event of a change of control could discourage a takeover of MidSouth, these provisions have not been included for the purposes of making MidSouth a less attractive takeover target. Transferability of Incentives. Options, SARs and performance shares are not transferable except (a) by will, (b) by the laws of descent and distribution, (c) pursuant to a domestic relations order or (d) to family members, to a trust for the benefit of family members or to charitable institutions, if permitted by the Committee after considering tax and securities law consequences and if so provided in the Incentive agreement. Stock Options Granted to Employees The following incentive stock options have been granted to the persons named in the table below, subject to shareholder approval of the plan at the Meeting. If the Plan is not approved, all of these options will be forfeited. The options have an exercise price of $11.25 per share, the fair market value of such shares as determined by the Committee as of the date of grant, and will expire on February 27, 2007, or earlier in the event of termination of employment, death or disability. All options will be exercisable in 20% annual increments beginning one year after the date of grant. OPTIONS TO EMPLOYEES UNDER THE 1997 INCENTIVE PLAN
Number of Shares Subject to Name Stock Options ____ ______________ C. R. Cloutier 15,000 Karen L. Hail 10,000 Donald R. Landry 7,500 William R. Snyder 5,000 Teri S. Stelly 2,500 Jennifer S. Fontenot 2,500 Sally D. Gary 1,000 ______ Total 43,500
Stock Options to Non-Employee Directors Directors who are not also full-time employees of MidSouth ("Non-Employee Directors") have been granted, and any person who becomes a Non-Employee Director in the future will be automatically granted at such time, a non-qualified option to purchase up 6,500 shares of Common Stock at fair market value on the date of grant, exercisable in annual 20% increments beginning one year from the date of grant. Non-Employee Directors are not eligible to receive any other Incentive under the Plan. Generally, the terms of the Plan described above will apply to such options, except that (i) the Committee has no power to accelerate any options, (ii) transfer of options other than in specified situations, may be permitted only by the full Board and (iii) all unexercisable options at the time a Non-Employee Director terminates Board service for any reason will expire, and all exercisable options at the time must be exercised within 6 months of termination for death, disability or retirement after age 65, and within 90 days for any other reason. The table under "Election of Directors" lists the directors of MidSouth, each of whom received Non-Employee Director options under the Plan, other than Mr. Cloutier and Ms. Hail, at an exercise price of $11.25 per share, the fair market value of a share of Common Stock on the date of grant. A total of 39,000 shares of Common Stock underlying the options granted to the Non- Employee Directors. Federal Income Tax Consequences Under existing federal income tax provisions, a participant who receives stock options, SARs or performance shares or who receives shares of restricted stock that are subject to restrictions which create a "substantial risk of forfeiture" (within the meaning of Section 83 of the Code) will not normally realize any income, nor will MidSouth normally receive any deduction for federal income tax purposes, in the year such Incentive is granted. When a non-qualified stock option granted pursuant to the Plan is exercised, the recipient will realize ordinary income measured by the difference between the aggregate purchase price of the shares of Common Stock as to which the option is exercised and the aggregate fair market value of the shares of Common Stock on the exercise date, and MidSouth will be entitled to a deduction in the year the option is exercised equal to the amount the recipient is required to treat as ordinary income. An employee, consultant or advisor generally will not recognize any income upon the exercise of any incentive stock option, but the excess of the fair market value of the shares at the time of exercise over the option price will be an item of adjustment, which may subject the holder of the option to the alternative minimum tax imposed by Section 55 of the Code. The alternative minimum tax is imposed to the extent it exceeds federal regular individual income tax, and it is intended to ensure that individual taxpayers who have economic income do not avoid income tax by taking advantage of exclusions, deductions and credits for regular tax purposes. An optionee will recognize capital gain or loss in the amount of the difference between the exercise price and the sale price on the sale or exchange of stock acquired pursuant to the exercise of an incentive stock option, provided the optionee does not dispose of such stock within two years from the date of grant and one year from the date of exercise of the incentive stock option (the "required holding periods"). An optionee disposing of such shares before the expiration of the required holding period will recognize ordinary income generally equal to the difference between the option price and the fair market value of the stock on the date of exercise. The remaining gain, if any, will be capital gain. MidSouth will not be entitled to a federal income tax deduction in connection with the exercise of an incentive stock option, except where the optionee disposes of the Common Stock received upon exercise before the expiration of the required holding period. If the exercise price of an option is paid by the surrender of previously owned shares, the basis of the previously owned shares carries over to the shares received in replacement therefor. If the option is a non-qualified option, the income recognized on exercise is added to the basis. If the option is an incentive stock option, the optionee will recognize gain if the shares surrendered were acquired through the exercise of an incentive stock option and have not been held for the applicable holding period. This gain will be added to the basis of the shares received in replacement of the previously owned shares. When a SAR is exercised, the participant will recognize ordinary income in the year the SAR is exercised equal to the value of the appreciation that he is entitled to receive pursuant to the formula previously described, and MidSouth will be entitled to a deduction in the same year and in the same amount. An employee who receives restricted stock or performance shares will normally recognize taxable income on the date the shares become transferable or no longer subject to substantial risk of forfeiture or on the date of their earlier disposition. The amount of such taxable income will be equal to the amount by which the fair market value of the shares of Common Stock on the date such restrictions lapse (or any earlier date on which the shares are disposed of) exceeds their purchase price, if any. An employee may elect, however, to include in income in the year of purchase or grant the excess of the fair market value of the shares of Common Stock (without regard to any restrictions) on the date of purchase or grant over its purchase price. Subject to the limitations imposed by Section 162(m) of the Code, MidSouth will be entitled to a deduction for compensation paid in the same year and in the same amount as income is realized by employee. Dividends currently paid to the participant will be taxable compensation income to the participant and deductible by MidSouth. A participant who receives a stock award under the Plan consisting of shares of Common Stock will realize ordinary income in the year of the award in an amount equal to the fair market value of the shares of Common Stock covered by the award on the date it is made, and MidSouth will be entitled to a deduction equal to the amount the participant is required to treat as ordinary income. A participant who receives a cash award will realize ordinary income in the year the award is paid equal to the amount thereof, and the amount of the cash award will be deductible by MidSouth. If, upon a change in control of MidSouth, the exercisability or vesting of an Incentive granted under the Plan is accelerated, any excess on the date of the change in control of the fair market value of the shares or cash issued under Incentives over the purchase price of such shares, if any, may be characterized as Parachute Payments (within the meaning of Section 280G of the Code) if the sum of such amounts and any other such contingent payments received by the employee exceeds an amount equal to three times the "Base Amount" for such employee. The Base Amount generally is the average of the annual compensation of such employee for the five years preceding such change in ownership or control. An Excess Parachute Payment, with respect to any employee, is the excess of the Parachute Payments to such person, in the aggregate, over and above such person's Base Amount. If the amounts received by an employee upon a change in control are characterized as Parachute Payments, such employee will be subject to a 20% excise tax on the Excess Parachute Payment, and MidSouth will be denied any deduction with respect to such Excess Parachute Payment. The Plan permits a participant to elect to have a sufficient number of shares withheld to satisfy the participant's withholding tax obligation with respect to the grant or vesting of an Incentive. The summary of federal income tax consequences does not purport to be complete. Reference should be made to the applicable provisions of the Code. There also may be state and local income tax consequences applicable to transactions involving Incentives. Vote Required The Board of Directors has unanimously approved the Plan. Approval of the Plan requires the affirmative vote of the holders of a majority of the shares of Common Stock present at the meeting. The Board of Directors unanimously recommends that you vote for approval of the Plan. EXECUTIVE COMPENSATION AND CERTAIN TRANSACTIONS Summary of Executive Compensation The following table shows all compensation awarded to, earned by or paid to MidSouth's Chief Executive Officer, C. R. Cloutier, and Chief Financial Officer, Karen L. Hail, for all services rendered by them in all capacities to MidSouth and its subsidiaries for 1996. No other executive officer of MidSouth had total annual salary and bonus exceeding $100,000 for the year.
Long-Term Compensation ______________________________________________________ Re- Other stricted Securities Name and Annual Stock Underlying LTIP All Other Principal Salary Bonus Compen- Award(s) Option(s) Payouts Compensation Position Year ($) ($) sation($) ($) SARs($) ($) ($) ________ ____ ________ ________ ________ ________ __________ _______ ____________ C. R. Cloutier 1996 $124,075 $17,586 0 0 0 0 $7,311 Chief Executive 1995 $119,450 $19,445 0 0 0 0 5,865 Officer 1994 $111,517 $15,071 0 0 0 0 9,165 Karen L. Hail 1996 $ 88,600 $11,104 0 0 0 0 $7,143 Chief Financial 1995 $ 85,100 $12,235 0 0 0 0 5,520 Officer 1994 $ 85,074 $ 8,417 0 0 0 0 3,732 ________________________
Includes director fees of $13,075 and $12,850 for 1996; $11,950 and $11,600 for 1995; and $11,900 and $12,000 for 1994 for Mr. Cloutier and Ms. Hail, respectively. Awarded pursuant to the Incentive Compensation Plan of the Bank. Consists of an estimated $6,484 contributed by MidSouth to the ESOP for the accounts of each of Mr. Cloutier and Ms. Hail, and $827 and $659 paid by MidSouth in insurance premiums for term life insurance for the benefit of Mr. Cloutier and Ms. Hail, respectively. ____________________________ Option Exercises and Holdings The following table sets forth information with respect to MidSouth's Chief Executive Officer, C. R. Cloutier, and Chief Financial Officer, Karen L. Hail, concerning their exercise of options during 1996 and unexercised options held as of December 31, 1996. As of December 31, 1996, no other officers of MidSouth held options to purchase shares of MidSouth. See "Stock Options Granted to Employees" for information as to options granted after December 31, 1996. AGGREGATED OPTION EXERCISES IN 1996 AND OPTION VALUES AS OF DECEMBER 31, 1996
No. of Number of Securities Value of Unexercised Shares Underlying Unexercised In-the-Money Options/SARs Acquired on Value Options/SARs Realized Options/SARs at Name Exercise Realized December 31, 1996 December 31, 1996 ____ __________ ________ __________________________ __________________________ Exercisable Unexercisable Exercisable Unexercisable C. R. Cloutier 14,000 $93,943 0 0 0 N.A. Karen L. Hail 10,000 $77,225 0 0 0 N.A.
Employment and Severance Contracts with Named Executive Officers Mr. Cloutier and Ms. Hail each have a written employment agreement with the Bank for a term of one year, beginning February 15th of each year. The agreements are automatically extended for one year every year thereafter beginning on the termination date, unless written notice of termination is given by any party to the agreement not later than 60 days before the termination date. Pursuant to the contract, Mr. Cloutier and Ms. Hail receive term life insurance equal to four times their annual salary payable to a beneficiary of their choice and disability insurance of not less than two-thirds of their annual salary. Mr. Cloutier's and Ms. Hail's contracts have a severance provision which entitles them to one year's salary if the agreement is terminated by the Bank, unless they are removed by a regulatory body. Certain Transactions Directors, nominees and executive officers of MidSouth and their associates have been customers of, and have borrowed from, the Bank in the ordinary course of business, and such transactions are expected to continue in the future. In the opinion of MidSouth's management, such transactions have been on substantially the same terms, including interest rates and collateral, as those prevailing at the time of comparable transactions with other persons and did not involve more than the normal risk of collectibility or present other unfavorable features. RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS MidSouth's consolidated financial statements for 1996 were audited by Deloitte & Touche, LLP, and the Board has appointed it to audit MidSouth's financial statements for 1997. Representatives of Deloitte & Touche, LLP are not expected to be present at the meeting. SHAREHOLDER PROPOSALS Eligible shareholders who desire to present a proposal qualified for inclusion in the proxy materials relating to the 1998 annual meeting must forward such proposal to the Secretary of MidSouth at the address listed on the first page of this Proxy Statement in time to arrive at MidSouth before January 15, 1998. ANY SHAREHOLDER MAY BY WRITTEN REQUEST OBTAIN WITHOUT CHARGE A COPY OF MIDSOUTH'S ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED DECEMBER 31, 1996, WITHOUT EXHIBITS. REQUESTS SHOULD BE ADDRESSED TO SALLY D. GARY, INVESTOR RELATIONS, MIDSOUTH BANCORP, INC., P. O. BOX 3745, LAFAYETTE, LOUISIANA 70502. By Order of the Board of Directors Karen L. Hail Secretary Lafayette, Louisiana April 11, 1997 SAMPLE BALLOT FOR MIDSOUTH BANCORP, INC. ANNUAL MEETING TO BE HELD ON 5-14-97 AT 2:00 P.M. CDT FOR HOLDERS AS OF MARCH 31, 1 97- CUSIP NO. 598039105 1. Election of Class I Directors Nominees: C. R. Cloutier J. B. Hargroder, M.D. William M. Simmons ___ FOR all nominees listed except as marked to the contrary ___ WITHHOLD authority for all nominees ___ If you wish to withhold authority to vote for certain of the nominees listed, strike through the nominee(s) names. 2. Approval of MidSouth's 1997 Stock Incentive Plan ___ FOR ___ AGAINST ___ ABSTAIN 3. In their discretion, to vote upon such other business as may properly come before the meeting or any adjournment thereof. This proxy will be voted as specified. If no specific directions are given, this proxy will be voted FOR the nominees named and FOR approval of the 1997 Stock Incentive Plan. Please sign exactly as name appears on the certificate or certificates representing shares to be voted by the proxy. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized persons. If a partnership, please sign in partnership name by authorized persons. Dated:___________________1997 _____________________________ Signature of Shareholder _____________________________ Signature (if jointly owned) PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD TO THE COMPANY PROMPTLY USING THE ENCLOSED ENVELOPE. PROXY MIDSOUTH BANCORP, INC. May 14, 1997 Annual Meeting of Shareholders THIS PROXY IS SOLOCITED ON BEHALF OF THE BOARD OF DIRECTORS. The undersigned hereby appoints Raymond F. Mikolajczyk and Barbara Hightower, or any of them, proxies of the undersigned, with full power of substitution, to represent the undersigned and to vote all of the shares of Common Stock of MidSouth Bancorp, Inc. (the "Company") that the undersigned is entitled to vote at the annual meeting of the shareholders of the Company to be held on May 14, 1997 and at any and all adjournments thereof. EX-99 2 MIDSOUTH BANCORP, INC. 1997 STOCK INCENTIVE PLAN 1. Purpose. The purpose of this Plan (the "Plan") is to increase shareholder value of MidSouth Bancorp, Inc. ("MidSouth") and to advance the interests of it and its subsidiaries (collectively, the "Company") by furnishing a variety of economic incentives (the "Incentives") designed to attract, retain and motivate key employees, officers and directors and to strengthen the mutuality of interests between such persons and shareholders. Incentives may consist of opportunities to purchase or receive shares of MidSouth common stock (the "Common Stock"), monetary payments or both, on terms determined under the Plan. As used in the Plan, the term "subsidiary" means any corporation of which MidSouth owns (directly or indirectly) within the meaning of Section 425(f) of the Internal Revenue Code of 1986, as amended (the "Code"), 50% or more of the total combined voting power of all classes of stock. 2. Administration. 1 Composition. The Plan shall be administered by the personnel committee (the "Committee") of MidSouth's Board of Directors ("Board"). The Committee shall consist of not fewer than two members of the Board, each of whom shall qualify as a "non-employee director" under Rule 16b-3 under the Securities Exchange Act of 1934 (the "1934 Act") and an "outside director" under Section 162(m) of the Code. 2 Authority. The Committee shall have plenary authority to award Incentives within Plan limits, to interpret the Plan, to establish any rules or regulations relating to the Plan that it determines to be appropriate, to enter into agreements with participants as to the terms of the Incentives ("Incentive Agreements") and to make any other determination that it believes necessary or advisable for the Plan's proper administration. Its decisions in matters relating to the Plan shall be final and conclusive on the Company and participants. The Committee may delegate its authority hereunder to the extent provided elsewhere herein. The Committee shall not have authority to award Incentives under the Plan to directors of MidSouth who are not also full-time employees of the Company ("Outside Directors"), but Outside Directors may receive awards under the Plan as specifically provided in Section 10 hereof. 3. Eligible Employees. Key employees of the Company (including officers and directors who are full-time employees, but excluding Outside Directors) shall become eligible to receive Incentives under the Plan when designated by the Committee. Employees may be designated individually or by groups or categories, as the Committee deems appropriate. With respect to participants not subject to Section 16 of the 1934 Act and not covered employees under Section 162(m) of the Code, the Committee may delegate its authority to designate participants, to determine the size and type of Incentives to be received by those participants and to determine or modify performance objectives for those participants. 4. Types of Incentives. Incentives may be granted under the Plan in any of the following forms, either individually or in combination: (a) incentive stock options (ISO") and non-qualified stock options ("NQO"); (b) stock appreciation rights ("SARs"); (c) restricted stock ("ISO"); and (d) performance shares. 5. Shares Subject to the Plan. 1 Number of Shares. Subject to adjustment as provided in Section 11.5, a total of eight percent of the shares of Common Stock from time to time outstanding are authorized to be issued under the Plan. If a stock option, SAR or performance share granted hereunder expires or is terminated or canceled prior to exercise or payment, any shares of Common Stock that were issuable thereunder may be issued again under the Plan. If shares of Common Stock are issued as Incentives under the Plan and thereafter are forfeited or reacquired by the Company pursuant to rights reserved upon issuance thereof, such forfeited and reacquired shares may be issued again under the Plan. If an Incentive is to be paid in cash by its terms, the Committee need not make a deduction from the shares of Common Stock issuable under the Plan with respect thereto. If and to the extent that an Incentive may be paid in cash or shares of Common Stock, the total number of shares available for issuance hereunder shall be decreased by the number of shares payable under such Incentive, provided that upon any payment of all or part of such Incentive in cash, the total number of shares available for issuance hereunder shall be increased by the appropriate number of shares represented by the cash payment, as determined in the sole discretion of the Committee. Additional rules for determining the number of shares granted under the Plan may be made by the Committee, as it deems necessary or appropriate. 2 Type of Common Stock. Common Stock issued under the Plan may be authorized and unissued shares or issued shares held as treasury shares. 6. Stock Options. A stock option is a right to purchase shares of Common Stock from MidSouth. Stock options granted under this Plan may be ISOs or NQOs. Any option that is designated as a NQO shall not be treated as an ISO. Each stock option granted by the Committee under this Plan shall be subject to the following terms and conditions: 1 Price. The exercise price per share shall be determined by the Committee, subject to adjustment under Section 11.5; provided that in no event shall the option price shall not be less than the Fair Market Value of a share of Common Stock on the date of grant. 2 Number. The number of shares of Common Stock subject to the option shall be determined by the Committee, subject to adjustment under Section 11.5. 3 Duration and Time for Exercise. The term and exercisability of each stock option shall be determined by the Committee, which may also accelerate the exercisability of any stock option. 4 Repurchase. Upon approval of the Committee, MidSouth may repurchase a previously granted stock option from a participant before it has been exercised by payment to the participant of the amount per share by which the Fair Market Value (as defined in Section 11.12) of the Common Stock subject to the option on the date of purchase exceeds the exercise price. 5 Manner of Exercise. A stock option may be exercised, in whole or in part, by giving written notice to Mid South specifying the number of shares of Common Stock to be purchased and accompanied by the full purchase price for such shares in United States dollars. The price may be paid (a) by cash, uncertified or certified check or bank draft, (b) by delivery of shares of Common Stock held by the optionee for at least six months in payment of all or any part of the option price, which shares shall be valued for this purpose at the Fair Market Value on the date such option is exercised, (c) by delivering a properly executed exercise notice together with irrevocable instructions to a broker approved by MidSouth (with a copy to MidSouth) to promptly deliver to MidSouth the amount of sale or loan proceeds to pay the exercise price or (d) in such other manner as may be authorized from time to time by the Committee. In the case of delivery of an uncertified check upon exercise of a stock option, no shares shall be issued until the check has been paid in full. Prior to the issuance of shares of Common Stock upon the exercise of a stock option, a participant shall have no rights as a shareholder. 6 Incentive Stock Options. Notwithstanding anything in the Plan to the contrary, the following additional provisions shall apply to the grant of stock options that are intended to qualify as ISOs (as is defined in Section 422A of the Code): (a) Any ISO agreement authorized under the Plan shall contain such other provisions as the Committee shall deem advisable, but shall in all events be consistent with and contain or be deemed to contain all provisions required in order to qualify the options as ISOs. (b) All ISO must be granted within ten years from the date on which this Plan is adopted by the Board. (c) Unless sooner exercised, all ISO shall expire no later than ten years after the date of grant. (d) The option price for ISO shall be not less than the Fair Market Value of the Common Stock subject to the option on the date of grant. (e) No ISO shall be granted to any participant who, at the time such option is granted, would own (within the meaning of Section 422A of the Code) stock possessing more than 10% of the total combined voting power of all classes of stock of the employer corporation or of its parent or subsidiary corporation. (f) The aggregate Fair Market Value (determined with respect to each ISO as of the time such ISO is granted) of the Common Stock with respect to which ISO are exercisable for the first time by a participant during any calendar year (under the Plan or any other plan of the Company) shall not exceed $100,000. To the extent this $100,000 limitation is exceeded, the options that relate to the excess shall be treated as NQOs. 7. Restricted Stock. 1 Grant of Restricted Stock. The Committee may award shares of restricted stock to such key employees as it determines to be eligible pursuant to Section 3. An award may be subject to the attainment of specified performance goals or targets, restrictions on transfer, forfeitability provisions and such other terms and conditions as the Committee may determine, subject to the Plan. To the extent restricted stock is intended to qualify as performance based compensation under Section 162(m) of the Code, it must meet the additional requirements imposed thereby. 2 The Restricted Period. At the time an award of restricted stock is made, the Committee shall establish a period of time during which the transfer of the shares shall be restricted (the "Restricted Period"). Each award of restricted stock may have a different Restricted Period. A Restricted Period of at least three years is required, except that if vesting of the shares is subject to the attainment of specified performance goals, a Restricted Period of one year or more is permitted. The expiration of the Restricted Period shall also occur as provided under Section 11.11. 3 Escrow. The participant receiving restricted stock shall enter into an Incentive Agreement with MidSouth setting forth the conditions of the grant. Certificates representing shares of restricted stock shall be registered in the name of the participant and deposited with MidSouth, together with a stock power endorsed in blank by the participant. Each such certificate shall bear a legend in substantially the following form: The transferability of this certificate and the shares represented by it is subject to the terms (including conditions of forfeiture) of the MidSouth Bancorp, Inc. 1997 Stock Incentive Plan (the "Plan") and an agreement entered into between the registered owner and MidSouth Bancorp, Inc. thereunder. Copies of the Plan and agreement are on file and available for inspection at the principal office of the Company. 4 Dividends on Restricted Stock. Any and all cash and stock dividends paid with respect to the shares of restricted stock shall be subject to any restrictions on transfer, forfeitability provisions or reinvestment requirements as the Committee may, in its discretion, prescribe in the Incentive Agreement. 5 Forfeiture. If any shares of restricted stock are forfeited under the Incentive Agreement (including any additional shares that may result from the reinvestment of cash and stock dividends, if so provided in the Incentive Agreement), such forfeited shares shall be surrendered and the certificates canceled. The participants shall have the same rights and privileges, and be subject to the same forfeiture provisions, with respect to any additional shares received pursuant to Section 11.5 due to a recapitalization, merger or other change in capitalization. 6 Expiration of Restricted Period. Upon the expiration or termination of the Restricted Period and the satisfaction of any other conditions prescribed by the Committee or at such earlier time as provided for in Section 7.2 and in the Incentive Agreement, the restrictions applicable to the restricted stock shall lapse and a stock certificate for the number of shares of restricted stock with respect to which the restrictions have lapsed shall be delivered, free of all such restrictions and legends other than those required by law, to the participant or the participant's estate, as the case may be. 7 Rights as a Shareholder. Subject to the Plan and to any restrictions on the receipt of dividends that may be imposed in the Incentive Agreement, each participant receiving restricted stock shall have all the rights of a shareholder with respect to such stock during any period in which such stock is subject to forfeiture and restrictions on transfer, including without limitation, the right to vote such stock. 8. Stock Appreciation Rights. A SAR is a right to receive, without payment to MidSouth, a number of shares of Common Stock, cash or any combination thereof, the amount of which is determined pursuant to the formula set forth in Section 8.4. A SAR may be granted (a) with respect to any stock option granted under the Plan, either concurrently with the grant of such option or at such later time as determined by the Committee (as to all or any portion of the shares of Common Stock subject to the option), or (b) alone, without reference to any related option. Each SAR granted by the Committee under the Plan shall be subject to the following terms and conditions: 1 Number. The SAR shall relate to such number of shares of Common Stock as shall be determined by the Committee, subject to Section 5.1 and subject to adjustment as provided in Section 11.5. In the case of a SAR granted with respect to a stock option, the number of shares of Common Stock to which the SAR pertains shall be reduced in the same proportion that the holder of the option exercises the related stock option. 2 Duration and Time for Exercise. The term and exercisability of each SAR shall be determined by the Committee. Unless otherwise provided by the Committee in the Incentive Agreement, each SAR issued in connection with a stock option shall become exercisable at the same time or times, to the same extent and upon the same conditions as the related stock option. The Committee may in its discretion accelerate the exercisability of any SAR at any time. 3 Exercise. A SAR may be exercised, in whole or in part, by giving written notice to MidSouth, specifying the number of SARs that the holder wishes to exercise. MidSouth shall, within 30 days of receipt of notice of exercise, deliver to the exercising holder certificates for the shares of Common Stock or cash or both, as determined by the Committee, to which the holder is entitled pursuant to Section 8.4. 4 Payment. Subject to the right of the Committee to deliver cash in lieu of shares of Common Stock, the number of shares of Common Stock that shall be issuable upon the exercise of an SAR shall be determined by dividing: (a) the number of shares as to which the SAR is exercised multiplied by the amount by which the Fair Market Value of the shares of Common Stock subject to the SAR on the Exercise Date exceeds (1) in the case of a SAR related to a stock option, the purchase price of the shares under the option or (2) in the case of a SAR granted alone, without reference to a related stock option, an amount equal to the Fair Market Value of a share of Common Stock on the date of grant, which shall be determined by the Committee at the time of grant, subject to adjustment under Section 11.5); by (b) the Fair Market Value of a share of Common Stock on the Exercise Date. In lieu of issuing shares of Common Stock upon the exercise of a SAR, the Committee may elect to pay the holder of the SAR cash equal to the Fair Market Value on the Exercise Date of any or all of the shares that otherwise would be issuable. No fractional shares of Common Stock shall be issued upon the exercise of a SAR; instead, the holder of a SAR shall be entitled to receive a cash adjustment equal to the same fraction of the Fair Market Value of a share of Common Stock on the Exercise Date or to purchase the portion necessary to make a whole share at its Fair Market Value on the Exercise Date. 9. Performance Shares. A performance share consists of an award that may be paid in shares of Common Stock or in cash, as described below. The award of performance shares shall be subject to such terms and conditions as the Committee deems appropriate. 1 Performance Objectives. Each performance share will be subject to performance objectives for MidSouth or one of its subsidiaries, divisions or departments to be achieved by the end of a specified period. The number of performance shares awarded shall be determined by the Committee and may be subject to such terms and conditions as it shall determine. If the performance objectives are achieved, each participant will be paid (a) a number of shares of Common Stock equal to the number of performance shares initially granted to him or her; (b) a cash payment equal to the Fair Market Value of such number of shares of Common Stock on the date the performance objectives are met or such other date as may be provided by the Committee or (c) a combination of shares of Common Stock and cash, as may be provided by the Committee. If such objectives are not met, each award may provide for lesser payments in accordance with a pre-established formula set forth in the Incentive Agreement. Notwithstanding the foregoing, unless otherwise provided in the Incentive Agreement, the Committee may in its discretion declare the performance objectives achieved or waived. To the extent a performance share is intended to qualify as performance based compensation under Section 162(m) of the Code, it must meet the additional requirements imposed thereby. 2 Not a Shareholder. The award of performance shares to a participant shall not create any rights in such participant as a shareholder of MidSouth, until the payment of shares of Common Stock with respect to an award, at which time such stock shall be considered issued and outstanding. 3 Dividend Equivalent Payments. A performance share award may be granted in conjunction with dividend equivalent payment rights or other such rights. Dividend equivalent payments may be made to the participant at the time of the payment of the dividend or issuance of the other right or at the end of the specified performance period or may be deemed to be invested in additional performance shares at the Fair Market Value of a share of Common Stock on the date of payment of the dividend or issuance of the right. 10. Stock Options for Outside Directors 1 Eligibility. Each Outside Director who is serving on the date of adoption of this Plan or who becomes an Outside Director subsequently shall on the later of such date of adoption or the second anniversary of the date he becomes an Outside Director, be automatically granted a NQO to acquire 6,500 shares of Common Stock. 2 Exercisability of Stock Options. The stock options granted to Outside Directors under this Section 10 shall become exercisable as follows: 20% of the total number of shares covered by the stock options beginning one year after the date of grant; 40% of the total number of shares covered by the stock options beginning two years after the date of grant, less any shares previously issued; 60% of the total number of shares covered by the stock options beginning three years after the date of grant, less any shares previously issued; 80% of the total number of shares covered by the stock options beginning four years after the date of grant, less any shares previously issued; 100% of the total number of shares covered by the stock options beginning five years after the date of grant, less any shares previously issued; provided, however, that such stock options shall become immediately exercisable under Section 11.11 hereof and in the event of death, disability causing his removal from the Board, or retirement from the Board on or after reaching age 65. No stock option granted to an Outside Director under the terms of this Section 10 may be exercised more than ten years after the date of grant. 3 Exercise Price. The per share exercise price of stock options granted to Outside Directors shall be equal to 100% of the Fair Market Value of a share of Common Stock on the date of grant. 4 Exercise after Termination of Board Service. If an Outside Director ceases to serve on the Board because of death, retirement on or after reaching age 65, or disability causing his removal from the Board, all stock options previously granted that are not then exercisable will expire and the options that are exercisable must be exercised within six months from the date of termination of Board service, but in no event later than ten years after the date of grant. If an Outside Director ceases to serve on the Board for any other reason, all options not then exercisable will expire and all options that are exercisable must be exercised within 90 days from the date of termination of Board service, but in no event later than ten years after the date of grant. 10.5 Certain Provisions Applicable. Sections 6.4 and 6.5 of this Plan shall apply to options granted under this Section 10. 11. General. 1 Duration. Subject to Section 11.10, the Plan shall remain in effect until all Incentives granted under the Plan have either been satisfied by the issuance of shares of Common Stock or the payment of cash or been terminated under the terms of the Plan and all restrictions imposed on shares of Common Stock in connection with their issuance under the Plan have lapsed. 2 Transferability of Incentives. Options, SARs and performance shares granted under the Plan may not be transferred except: (a) by will; (b) by the laws of descent and distribution; or (c) in the case of stock options only, if (i) with respect to options under Section 10, permitted by the Board or (ii) with respect to all other options, permitted by the Committee and so provided in the Incentive Agreement, (iii) pursuant to a domestic relations order, as defined in the Code, (iv) to Immediate Family Members, (v) to a partnership or limited liability company in which Immediate Family Members, or entities in which Immediate Family Members are the sole owners, members or beneficiaries, as appropriate, are the only partners or members or (vi) to a trust for the sole benefit of Immediate Family Members. "Immediate Family Members" means the spouse and natural or adopted children or grandchildren of the participant and his or her spouses. To the extent that an ISO is permitted to be transferred during the lifetime of the participant, it shall be treated thereafter as a NQO. Stock options or SARs may be exercised during the lifetime of a participant only by the participant, by the participant's guardian or legal representative or, in the case of stock options, by a permitted transferee as provided in (c) above. Any attempted assignment, transfer, pledge, hypothecation or other disposition of an Incentive, or levy of attachment or similar process upon the Incentive not specifically permitted herein, shall be null and void and without effect. 3 Effect of Termination of Employment or Death. If an employee participant ceases to be an employee of the Company for any reason, including death, disability, early retirement or normal retirement, any Incentives may be exercised, shall vest or shall expire at such times as may be determined by the Committee in the Incentive Agreement. 4 Additional Condition. Anything in this Plan to the contrary notwithstanding: (a) MidSouth may, if it determines it necessary or desirable for any reason, at the time of award of any Incentive or the issuance of any shares of Common Stock pursuant to any Incentive, require the recipient, as a condition to the receipt thereof or to the receipt of shares of Common Stock issued pursuant thereto, to deliver to MidSouth a written representation of present intention to acquire the Incentive or the shares of Common Stock issued pursuant thereto for his own account for investment and not for distribution; and (b) if at any time MidSouth further determines, in its sole discretion, that the listing, registration or qualification (or any updating of any such document) of any Incentive or the shares of Common Stock issuable pursuant thereto is necessary on any securities exchange or under any federal or state securities or blue sky law, or that the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with the award of any Incentive, the issuance of shares of Common Stock pursuant thereto, or the removal of any restrictions imposed on such shares, such Incentive shall not be awarded or such shares of Common Stock shall not be issued or such restrictions shall not be removed, as the case may be, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to MidSouth. 5 Adjustment. In the event of any merger, consolidation or reorganization of MidSouth with any other corporation or corporations, there shall be substituted for each of the shares of Common Stock then subject to the Plan, including shares subject to restrictions, options, or achievement of performance share objectives, the number and kind of shares of stock or other securities to which the holders of the shares of Common Stock will be entitled pursuant to the transaction. In the event of any recapitalization, stock dividend, stock split, combination of shares or other change in the Common Stock, the number of shares of Common Stock then subject to the Plan, including shares subject to outstanding Incentives, shall be adjusted in proportion to the change in outstanding shares of Common Stock. In the event of any such adjustments, the purchase price of any option, the performance objectives of any Incentive, and the shares of Common Stock issuable pursuant to any Incentive shall be adjusted as and to the extent appropriate, in the reasonable discretion of the Committee, to provide participants with the same relative rights before and after such adjustment. 6 Incentive Agreements. The terms of each Incentive other than those granted under Section 10 shall be stated in an agreement approved by the Committee. 7 Withholding. At any time that a participant is required to pay to the Company an amount required to be withheld under the applicable income tax laws in connection with the issuance of shares of Common Stock under the Plan or upon the lapse of restrictions on shares of restricted stock, the participant may, subject to the Committee's right of disapproval, satisfy this obligation in whole or in part by electing (the "Election") to have the Company withhold from the distribution shares of Common Stock having a value equal to the amount required to be withheld. The value of the shares withheld shall be based on the Fair Market Value of the Common Stock on the date that the amount of tax to be withheld shall be determined (the "Tax Date"). Each Election must be made prior to the Tax Date. The Committee may disapprove of any Election or may suspend or terminate the right to make Elections. If a participant makes an election under Section 83(b) of the Code with respect to shares of restricted stock, an Election is not permitted to be made. A participant may also satisfy his or her total tax liability related to an Incentive by delivering shares of Common Stock that have been owned by the participant for at least six months. The value of the shares delivered shall be based on the Fair Market Value of the Common Stock on the Tax Date. 8 No Continued Employment. No participant shall have any right, because of his or her participation, to continue in the employ of the Company for any period of time or to any right to continue his or her present or any other rate of compensation. 9 Deferral Permitted. Payment of cash or distribution of any shares of Common Stock to which a participant is entitled under any Incentive shall be made as provided in the Incentive Agreement. Payment may be deferred at the option of the participant if provided in the Incentive Agreement. 10 Amendment of the Plan. The Board may amend or discontinue the Plan at any time; provided, however, that no such amendment or discontinuance shall change or impair, without the consent of the recipient, an Incentive previously granted; and provided further, that an amendment to materially increase the number of shares of Common Stock issuable through the Plan, materially modify the eligibility requirements or materially increase the benefits under the Plan must be approved by the shareholders of MidSouth. 11. Change of Control. (a) A Change of Control shall mean: (i) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the 1934 Act) of beneficial ownership (within the meaning of Rule 13d-3 under the 1934 Act) of more than 25% of the outstanding voting power with respect to the election of directors ("Voting Securities"); provided, however, that for purposes of this subsection (i), no Change of Control will be over as a result of acquisition of Voting Securities: (a) directly from or by the Company, (b) by any employee benefit plan (or related trust) sponsored or maintained by the Company, or (c) by any corporation pursuant to a transaction that complies with clauses a), b) and c) of subsection (iii) of this Section; or (ii) individuals who, as of the date this Plan was adopted by the Board of Directors (the "Approval Date"), constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Approval Date whose election, or nomination for election by the shareholders of the Company, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered a member of the Incumbent Board, unless such individual's initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Incumbent Board; or (iii)consummation of a reorganization, merger or consolidation, or sale or other disposition of all or substantially all of the assets of the Company (a "Business Combination"), in each case unless, following such Business Combination, a) all or substantially all of the individuals and entities who were the beneficial owners of the outstanding Common Stock and the Voting Securities of the Company immediately prior to such Business Combination have direct or indirect beneficial ownership, respectively, of more than 50% of the then outstanding shares of common stock, and more than 50% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, of the corporation resulting from such Business Combination (which, for purposes of this clause) and clauses b) and c), shall include a corporation that as a result of such transaction owns the Company or all or substantially all of the assets of the Company either directly or through one or more subsidiaries), and b) except to the extent that such ownership existed prior to the Business Combination, no person (excluding any corporation resulting from such Business Combination or any employee benefit plan or related trust of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 25% or more of the then outstanding shares of common stock of the corporation resulting from such Business Combination or 25% or more of the combined voting power of the then outstanding voting securities of such corporation, and c) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or (iv) approval by the shareholders of the Company of a plan of complete liquidation or dissolution of the Company. (b) Upon a Change of Control, or immediately prior to the closing of a transaction that will result in a Change of Control if consummated, all outstanding options and SARs granted pursuant to the Plan shall automatically become fully exercisable, all restrictions or limitations on any Incentives shall lapse and all performance criteria and other conditions relating to the payment of Incentives shall be deemed to be achieved and waived by the Company, without the necessity of action by any person. (c) The Committee may take such other action with respect to an Incentive as shall be provided in an agreement with the holder thereof. 12 Definition of Fair Market Value. "Fair Market Value" of Common Stock shall be determined for purposes of this Plan, as follows: (a) if it is listed on an established stock exchange or any automated quotation system that provides sale quotations, the closing sale price for a share on such exchange or quotation system on the applicable date, or if no sale shall have been made on that day, on the next preceding day on which there was a sale; (b) if it is not listed on any exchange or quotation system, but bid and asked prices are quoted and published, the mean between the quoted bid and asked prices on the applicable date, and if bid and asked prices are not available on such day, on the next preceding day on which such prices were available; and (c) if it is not regularly quoted, the fair market value of a share on the applicable date as established by the Committee in good faith. Adopted by the Board of Directors _______________, 1997. Approved by the Shareholders _______________, 1997. 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