PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
APRIL 20, 1999
Solicitation and Voting of Proxies
This Proxy Statement and the accompanying Proxy Card are being furnished to
shareholders of Citizens Community Bancorp, Inc. ("Company") the parent company
of Citizens Community Bank of Florida ("Citizens Bank") in connection with the
solicitation of proxies by the Board of Directors to be used at the Company's
Annual Meeting of Shareholders ("Annual Meeting") or any adjournment thereof,
which will be held on Tuesday, April 20, 1999, at 10:00 a.m., Eastern Time at
the Olde Marco Inn, 100 Palm Street, Marco Island, Florida.
Regardless of the number of shares of common stock that you may own, it is
important that shareholders be represented by Proxy or in person at the Annual
Meeting. We would ask that you complete the enclosed Proxy Card and return it
signed and dated in the enclosed postage prepaid envelope. Please remember to
indicate the way you wish to vote in the space provided on the Proxy Card.
Proxies solicited by the Board of Directors of the Company will be voted in
accordance with the directions given therein. Where no instructions are
indicated, proxies will be voted :
"FOR" the management director nominees;
"FOR" the amendment to the Company's Articles of Incorporation which
would eliminate classes of director;
"FOR" ratification of the appointment of Hacker, Johnson, Cohen &
Grieb, PA as the independent auditors of the Company for the fiscal
year ending December 31, 1999; and
"FOR" the adjournment of the Annual Meeting to solicit additional
proxies in the event there are not sufficient votes to approve one or
more of the foregoing proposals.
Revocation of Proxy
Your presence at this Annual Meeting will not automatically revoke your
Proxy. You may revoke a Proxy at any time prior to the polls closing at the
Annual Meeting by:
o filing with the Company's Corporate Secretary a written notice of
revocation,
o by delivering to the Company a duly executed Proxy Card bearing a
later date, or
o by attending the Annual Meeting and voting in person.
<PAGE>
Voting Securities
The securities which may be voted at this Annual Meeting consist of shares
of common stock of the Company with each share entitling its owner to one vote
for the election of directors and any other matters that may come before the
Annual Meeting. The close of business on March 5, 1999, has been fixed by the
Board of Directors as the record date ("Record Date") for the determination of
shareholders entitled to notice of and to vote at this Annual Meeting and any
adjournment thereof. The total number of shares of the common stock outstanding
on the record date was 722 shares, which are held by approximately 3,455,039
shareholders. The presence, in person or by Proxy, of at least a majority of the
total number of outstanding shares of common stock is necessary to constitute a
quorum at the Annual Meeting.
If your shares are held in street name, your brokerage firm, under certain
circumstances, may vote your shares. Brokerage firms have authority under New
York Stock Exchange rules to vote customers' unvoted shares on certain "routine"
matters, including election of directors. The only non-routine matter being
considered at this Annual Meeting is Proposal II, the Amendment of the Articles
of Incorporation. If you do not vote your proxy, your brokerage firm may either:
o vote your shares on routine matter, or
o leave your shares unvoted.
We encourage you to provide instructions to your brokerage firm by voting your
proxy. This ensures your shares will be voted at the meeting.
When a brokerage firm votes its customers' unvoted shares on routine
matters, these shares are counted for purposes of establishing a quorum to
conduct business at the meeting. A brokerage firm cannot vote customer shares on
non-routine matters. Accordingly, these shares are considered not entitled to
vote on non-routine matters, rather than as a vote against the matter.
Certain Shareholders
As of March 5, 1999, no persons or apparent groups of persons, other than
officers or directors of the Company or Citizens Bank, and the following person,
are known by management to own beneficially five percent or more of the
outstanding shares of the Company's common stock:
Amount of Percent
Name Common Stock of Class
- ---- ------------ --------
Richard Storm, Jr.
264 Rock Hill Court
Marco Island, Florida 34145 523,000 15.09%
- -----------------
* Amount includes stock options to acquire 10,000 shares of common stock.
<PAGE>
PROPOSAL I -- ELECTION OF DIRECTORS
The Company's Board of Directors is composed of nine members, divided into
three classes. The terms of each class are staggered so that approximately
one-third of the directors are elected each year. The Board of Directors has
nominated three Class III Directors who will be elected to a three-year term to
stand for election at this Annual Meeting.
Management's nominees to fill the Class III terms are Stephen A.
McLaughlin, Richard Storm, Jr., and John J. Wolf. Each of the nominees are
presently directors of the Company.
It is intended that the proxies solicited by the Board of Directors will be
voted "FOR" the election of director nominees. If any nominee is unable to
serve, the shares represented by all valid proxies will be voted for the
election of such substitute as the Board may recommend. At this time we know of
no reason why any nominee might not be able to serve.
- --------------------------------------------------------------------------------
The Board of Directors recommends that shareholders vote "FOR"
election of the nominees.
- --------------------------------------------------------------------------------
BOARD OF DIRECTORS - Standing for Re-election:
Class III Directors
Photo
STEVEN A. McLAUGHLIN Director since 1995.
Mr. McLaughlin, age 52, is a founding director of the Company and of Citizens
Bank. He is the Treasurer of the Company, serves as Chairman of the Strategic
Planning Committee, and is a member of the ALCO, Audit, Executive Loan, and Year
2000 Committees. Prior to 1996, Mr. McLaughlin's business involved the
operations of several Maine-based real estate consulting and timber companies,
including Stillwater Land & Lumber Limited.
Photo
RICHARD STORM, JR. Director since 1995.
Mr. Storm, age 57, is a founding director, Chairman, CEO and President of the
Company, and serves on the Executive and Strategic Planning Committees of the
Board. He is also the Chairman of the Board of Directors of Citizens Bank, where
he serves on the Executive, Loan, Building Facilities, and Loan Loss Recovery
Committees. Mr. Storm is currently an at-large director for Group VI for
Community Bankers of Florida. Mr. Storm has an extensive background in real
estate management, marketing, finance and development. From 1987 to 1994, Mr.
Storm served as a director of Citizens National Bank and Citizens National
<PAGE>
Corporation, both of Naples, Florida. From 1992 to 1994, Mr. Storm served as
Corporate Secretary for Citizens National Corporation. Following the Citizens
National merger with AmSouth Bank of Florida in 1994, Mr. Storm served as a City
Director of AmSouth Bank until April 1995. In addition to his bank affiliations,
Mr. Storm is currently Chairman and CEO Community Broadcasting Corporation,
President of Lonestar Capital, Inc., Chairman and President of Deer Run
Properties, Inc. (a mortgage and venture capital company), and the Managing
General Partner for Cumberland Properties, Inc. a shopping center owner/operator
with principal offices in Windham, Maine. He is a member of the Loyal Order of
Moose in Marco Island.
Photo
JOHN G. WOLF Director since 1997.
Mr. Wolf, age 51, is Assistant Treasurer and a member of the Board of Directors
of the Company and serves as the Chairman of the Audit Committee. He is also a
member of the Strategic Planning Committee. Mr. Wolf is a practicing dentist in
Naples, Florida and is on the Board of Directors of the Florida Sports Shooting
Association, and a member of the Governor's Council on Sports and Fitness. Mr.
Wolf is also involved in health care delivery and the development and marketing
of dental practices.
CONTINUING DIRECTORS:
Photo
DIANE M. BEYER Class I - Director since 1995 - term expires 2000. Mrs. Beyer,
age 59, is a director and Assistant Secretary of the Company, and is a member of
its Audit, Loan and Year 2000 Committees. She also serves as a director of
Citizens Bank and as Chairman of the Board's Compensation and Personnel
Committee and is a member of the Audit, Compensation and Personnel, CRA and
Executive Committees. Mrs. Beyer has extensive business experience in the areas
of administration and human resources, and is a member of the National
Association of Women in Construction and was Chairman of its Public Relations/
Marketing Committee for 1990- 91. She has been a resident of Naples, Florida,
and a Human Resources Consultant since 1993, and serves in a policy-making role
in several non-profit organizations.
Photo
JOEL M. COX, SR. Class I - Director since 1995 - term expires 2000.
Mr. Cox, age 60, has 37 years of experience in banking and insurance. Mr. Cox is
a director of the Company and serves as Chairman of the ALCO, Executive and Loan
Committees. Mr. Cox is a member of the Board of Citizens Bank and is the
Chairman of the Asset/Liability Committee and the Vice Chairman of the Loan
Committee. He also serves on the Citizen Bank's Audit, Building and Facilities,
Compensation and Personnel and Executive Committees. Mr. Cox has been Vice
President and Director of Cox Insurance Agency, Inc., on Marco Island, Florida,
since 1985. He currently serves as Membership Chairman of the Kiwanis Club of
Marco Island and serves on the Marco Island Fair Water Committee.
Photo
JAMES S. HAGEDORN Class I - Director since 1996 - term expires 2000.
Mr. Hagedorn, age 55, is a director and Vice Chairman of the Company. He is also
a member of the Executive Committee. Mr. Hagedorn is a member the Board of
Directors of Citizens Bank, where he serves as Chairman of the Executive and
Loan Committees. Mr. Hagedorn has been President and Director of Waterside
Development Corp. since 1995. He served as Chairman, President, and CEO of The
Merchant Bank of Florida, Bradon, Florida, and as President of The Merchant
Bancorporation of Florida from 1986 through 1994.
Photo
THOMAS B. GARRISON Class II - Director since 1995 - Term Expires 2001. Mr.
Garrison, age 53, is a director of the Company and serves as Chairman of the
Year 2000 Committee. Mr. Garrison has over 30 years of experience in the design
and development of major software projects. Formerly with the Barron-Collier
Companies, where he served as the Management Information Systems Director, Chief
Information Officer, and currently as the Network Technology Manager. He has
been a Collier County resident, residing in Naples, Florida, since 1988, and has
been an active member of several Collier County civic organizations, including
Toastmaster, Naples Investment Club, Small CAP Investment Club, Naples Computer
Club, and the Latin- American Business Association.
Photo
DENNIS J. LYNCH Class II - Director since 1995 - Term Expires 2001. Mr. Lynch,
age 56, is a member of the Board of Directors of the Company and serves on its
ALCO and Executive Committees. Mr. Lynch has been involved in the real estate
sales and development business since moving to Naples in 1971. He has been the
owner and President of Dennis J. Lynch and Associates, a real estate sales
agency established in 1979. Since 1979, his firm has developed and been involved
in the management of over 500,000 square feet of commercial real estate space in
Collier County.
Photo
LOUIS J. SMITH Class II - Director since 1997 - Term Expires 2001.
Mr. Smith, age 74, is a member of the Board of Directors of the Company and
serves on its Audit and Executive Committees. Mr. Smith was a self-employed
Pharmacist for 34 years, currently owns and operates Pat's Hallmark is the Shops
of Marco on Marco Island and is the Officer in Charge of a U.S. Post Office in
Marco Island. Mr. Smith was formerly a bank director for the 1st Wisconsin Bank
of Wisconsin (now First-Star).
<PAGE>
The following table indicates certain information regarding the current
beneficial ownership of common stock by each of our directors and executive
officers, and all of the directors and executive officers as a group as of the
Record Date. As required by Rule 13d-3, under the Securities Act of 1933, the
number and percentage of shares held by each person reflects the number of
shares that person currently owns, plus the number of shares that person has the
right to acquire within the next 60 days as provided in currently outstanding
options.
- --------------------------------------------------------------------------------
Number of % of
Shares Right to Beneficial
Name Owned(1) Acquire(2) Ownership
Diane M. Beyer(3) 19,008 10,800 0.86%
Joel M. Cox, Sr.(4) 72,267 10,800 2.40
Thomas B. Garrison(5) 57,780 10,800 1.98
James S. Hagedorn(6) 25,380 10,800 1.04
Bruce G. Fedor(7) 2,160 10,800 0.37
Dennis J. Lynch(8) 84,240 10,800 2.74
Stephen A. McLaughlin(9) 100,310 17,280 3.39
Michael A. Micallef, Jr.(7) 4,320 32,400 1.05
Louis J. Smith 11,232 10,800 0.63
Richard Storm, Jr.(10) 513,000 10,800 15.11
W. Terrell Upson(11) 8,640 32,400 1.18
John J. Wolf 55,000 10,800 1.90
All Directors and Executive 953,337 179,280 31.16
Officers as a Group (12
persons)
- --------------------------------------------------------------------------------
(1) Includes shares for which the named person:
o has sole voting and investment power,
o has shared voting and investment power with a spouse, or
o holds in an IRA or other retirement plan program, unless
otherwise indicated in these footnotes, and
o does not include shares that may be acquired by exercising stock
options
(2) Includes shares that may be acquired by exercising vested stock
options.
(3) Includes 14,688 shares owned jointly by Mrs. Beyer and her spouse as
co-trustees FBO Diane M. Beyer.
(4) Includes 27,740 shares owned by the Joel M. Cox Revocable Trust for
which Mr. Cox is trustee; 11,880 shares held by Cede & Company f/b/o
for Mr. Cox; 6,696 shares held by Cox's Insurance of which Mr. Cox is
the Vice-President; 7,560 shares owned by Joan C. Cox, Maudie M.
Greene and William Greene; 4,557 shares owned by the Joan C. Cox
Revocable Trust; 11,880 shares held by Joel M. Cox's individual
retirement account, 13,834 shares held by Joan C. Cox's individual
retirement account.
(5) Includes 1,080 shares held by his wife's individual retirement
account.
(6) Includes 20,520 shares held by Robert W. Baird & Co. as trustee FBO
James S. Hagedorn IRA; and 1,080 shares held by Robert W. Baird & Co.
as trustee FBO for Mr. Hagedorn's spouse.
(7) An Executive Officer, not a director.
(8) Includes 31,320 shares held by Cede & Co. f/b/o Dennis Lynch IRA and
10,800 shares held by Cede & Co. f/b/o Bonnie Lynch.
(9) Includes 16,200 shares owned individually by Mr. McLaughlin; 8,640
shares held by the Stillwater Land & Lumber Limited Pension Plan of
which Mr. McLaughlin is the administrator and sole beneficiary; and
18,360 shares held by the Stillwater Land & Lumber Limited Profit
Sharing Plan of which Mr. McLaughlin is the administrator and sole
beneficiary.
<PAGE>
(10) Includes 11,000 shares owned by Storm & Company; 51,000 shares held by
the Richard Storm Profit Sharing Plan; 20,000 shares owned by the
Kathleen Storm Profit Sharing Plan; 540 shares owned by his wife,
Kathleen Storm; and 30,000 held by US Clearing FBO Richard Storm, Jr.
profit sharing plan.
(11) Former executive officer and director.
Board of Directors Meetings
The Board of Directors holds meetings on a regular basis. No current
director attended fewer than 75% of the total meetings of the Board of Directors
for the full year. The Company does not presently compensate directors for Board
or Committee meetings. Effective November 1, 1997, Citizens Bank began paying
directors' fees to its outside directors. Bank directors receive $100 for each
Board meeting attended and $25 for each Committee meeting attended.
Committees of the Board of Directors
================================================================================
Strategic Year
Board Member Board ALCO Audit Executive Loan Planning 2000
- --------------------------------------------------------------------------------
Diane M. Beyer X X X X
- --------------------------------------------------------------------------------
Joel M. Cox, Sr. X X X X
- --------------------------------------------------------------------------------
Thomas B. Garrison X X
- --------------------------------------------------------------------------------
James S. Hagedorn X X
- --------------------------------------------------------------------------------
Dennis J. Lynch X X X X
- --------------------------------------------------------------------------------
Stephen A. McLaughlin X X X X X X X
- --------------------------------------------------------------------------------
Louis J. Smith X X X
- --------------------------------------------------------------------------------
Richard Storm, Jr. X X X X
- --------------------------------------------------------------------------------
John J. Wolf X X X
- --------------------------------------------------------------------------------
Meetings Held in 1998 12 1 1 3 2 1 12
================================================================================
ALCO Committee
Establishes the asset and liability management policies of the Company, monitors
and sets limitations for interest-rate risk and formulate loan pricing.
Audit Committee
Reviews auditing, accounting, financial reporting and internal control
functions. Recommends our independent accountant and reviews their services. All
members are nonemployee directors.
Executive Committee
Limited powers to act on behalf of the Board whenever the Board is not in
session. Meets twice a month and acts only by unanimous vote. If any nonemployee
director wants a matter to be addressed by the Board rather than the Executive
Committee, then such matter is submitted to the Board.
<PAGE>
Loan Committee
Meets as required to act upon loan requests to be handled by the Company
individually or jointly with Citizens Bnak.
Strategic Planning Committee
Reviews the performance of the Company and Citizens Bank to determine if
budgeted goals are being met and to suggest methods by which corporate goals can
be achieved, both on a short-term and long-term basis. Responsible for
establishing a three-year strategic plan for the Company.
Year 2000 Committee
Meets monthly with management to evaluate the progress being made and the steps
being taken to ensure that the Company's computer and data processing systems
will be Year 2000 compliant.
<PAGE>
Report of the Board of Directors on Executive Compensation
Compensation Philosophy. The Board of Directors believes that there is a
close relationship between the financial interests of the our shareholders and
our officers and key employees, including the officers of our subsidiaries. The
Board further believes that compensation for officers and key employees should
be structured in such a way that total compensation consists of a base salary,
and short- and long-term incentive awards. To that end, we have created a
compensation program that provides for a base salary which is believed to be
competitive within the industry for persons with comparable responsibilities,
combined with annual cash bonus awards tied to specific performance, as well as
long-term stock option awards, which are also related to the Company's
performance and the performance of the officer or key employees and base salary
levels.
Executive Base Salary. Base salaries for executive officers are established
primarily through the use of peer group salary evaluations. The Board of
Directors utilized published compensation studies with regard to compensation
levels and practices of comparable commercial banks and similar financial
institutions in order to formulate its recommendation regarding executive
officer salaries for the year ended December 31, 1998. For fiscal year 1999, Mr.
Micallef's base salary was established using the Board's evaluation of salaries
paid to Chief Executive Officers with similar duties at comparable financial
institutions.
Annual Cash Bonus Awards. Cash bonus awards to executive officers, if any,
are determined annually by the Board of Directors and are based primarily on the
Company's financial results for that year. Objectives are established annually
by the Board and cash bonus awards are determined in relationship to the
achievements relating to these objectives.
Long-Term Pay Compensation. The long-term compensation plan is structured
around the Company's 1996 Incentive Stock Option Plan.
The following Summary Compensation Table shows compensation information
regarding Richard Storm, Jr. , Chairman of the Board and Chief Executive Officer
of the Company and Michael A. Micallef, Jr., President and Chief Executive
Officer of Citizens Bank, during the last three fiscal years. No other executive
officer received compensation at a level required to be reported herein by
Securities and Exchange regulations.
[Table follows this page]
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term Compensation*
-----------------------
Annual Compensation Awards Payouts
------------------- ------ -------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Securities
Name and Other Annual Restricted Underlying LTIP All Other
principal position Year Salary ($) Bonus ($) Compensation ($) Award(s)($) Options Payouts($) Compensation($)
- ------------------ ---- ---------- --------- ---------------------------- ------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Richard Storm, Jr. 1998 $24,000 --- --- --- --- --- ---
Chairman, President, 1997 --- --- --- --- --- --- ---
and CEO of Company 1996 --- --- --- --- --- --- ---
Michael Micallef, Jr. 1998 $82,000 --- --- --- --- --- ---
President and CEO of 1997 $48,396 $5,000 $9,115 30,000 --- --- ---
Bank 1996 (*) --- --- --- --- --- ---
- ------------------
(*) Employment effective May 13, 1997.
</TABLE>
Explanation of Columns
(c) Base Salary - Total base salary paid during the calendar year. Mr.
Micallef's current base salary is $82,000. Citizens Bank was responsible
for 100% of Mr. Micallef's cash compensation for the year ended December
31, 1998. Mr. Storm receives $1,500 per month from the Company for his
services and $500 per month from Citizens Bank.
(d) Annual Cash Bonus Award - Annual incentive awards paid for results
achieved during the calendar year, which were paid during the year
immediately following the years indicated.
(e) Other Annual Compensation - All additional forms of cash and
non-cash compensation paid, awarded or earned. Amount includes auto
allowances for 6 months and moving expenses of $6,000. The value of all
other personal benefits and perquisites received by Mr. Micallef was less
than the required reporting threshold.
(f) Restricted Stock Awards - Stock awarded to an executive that
carries vesting restrictions.
(g) Securities Underlying Options - Grants of stock options made under
the Company's 1996 Incentive Stock Option Plan.
(h) "LTIPs" - The dollar value of all payouts pursuant to long-term
incentive plans.
(i) All Other Compensation - All other compensation that does not fall
under any of the aforementioned catego ries.
Benefits
Insurance. Full-time officers and employees of Citizens Bank are
provided hospitalization, major medical, short- and long-term disability, dental
insurance, and term life insurance under group plans on generally the same basis
to all full-time employees.
Employment Contracts
The Company does not have an employment agreement with any of its
officers. Citizens Bank has an employment agreement ("Agreement") with its
President and Chief Executive Officer, Michael A. Micallef, Jr. The Agreement,
which became effective June 2, 1997, is for a one-year term and is automatically
renewed for a successive six month term unless either party notifies the other
of their desire to terminate the Agreement at the expiration of the term. Such
notice must be given at least 30 days prior to the expiration of the current
term.
Mr. Micallef's base salary under the current Agreement is $82,000,
plus reimbursement of reasonable business expenses. In addition, Mr. Micallef
may be granted an annual performance bonus, which is solely at the discretion of
the Board of Directors. Under the Agreement, Mr. Micallef was granted Incentive
Options for 15,000 shares of common stock at a grant price of $10.00 per share
(adjusted to 30,000 shares at $5.00 per share as a result of the December 15,
1997, two for one stock split) which options vest 20% per year and expire 10
years from the date of grant. Mr. Micallef is also provided an automobile
allowance and three-months disability coverage.
Mr. Micallef may participate in all employee benefits, stock option
plans, pension plans, insurance plans and other fringe benefits programs
commensurate with his position. The Agreement provides for termination by
Citizens Bank for "good cause". In the event Citizens Bank chooses to terminate
Mr. Micallef's employment for reasons other than for good cause, he (or in the
event of death, his beneficiaries) would be entitled to a severance payment
equal to the total annual compensation for the remainder of the term of the
Agreement, or six months pay, whichever is greater. In the event of a change of
control of the Company, Mr. Micallef will be entitled to one- year's annual
compensation.
In the event Mr. Micallef voluntarily terminates his employment other
than for the reasons mentioned herein, all rights and benefits under the
Agreement shall immediately terminate upon the effective date of termination.
[This space intentionally left blank]
<PAGE>
The following table sets forth information concerning the Incentive
Stock Options that have been granted to the executive officers of the Company
and Citizens Bank.
================================================================================
Shares Date Price
Name Granted(1) of Grant Per Share(2)
- ---- ---------- -------- ------------
Diane M. Beyer 10,800 April 30, 1998 $ 7.50
Joel M. Cox, Sr 10,800 May 19, 1998 7.50
David Klein 16,200(2) April 1, 1997 4.75
3,240(2) August 19, 1997 5.50
3,240(2) October 21, 1997 6.00
Bruce Fedor 10,800(2) November 10, 1997 6.00
864 December 31, 1998 5.52
Sharon Ginn 10,800(2) October 20, 1997 5.63
Stephen A. McLaughlin 4,320(2) October 8, 1996 4.50
2,160(2) May 21, 1997 5.00
10,800 October 28, 1998 7.50
Jeffrey L. Merwin 21,600 July 23, 1998 6.90
2,000 January 21, 1999 9.25
Michael A. Micallef, Jr 32,400(2) June 3, 1997 5.00
James F. Schaffer 10,800 October 28, 1998 9.50
11,880 December 17, 1998 9.50
Louis Smith 10,800 May 20, 1996 7.50
Richard Storm, Jr 10,800 February 24, 1998 7.50
W. Terrell Upson 21,600(2) May 20, 1996 4.50
10,800(2) February 18, 1997 4.50
John J. Wolf 10,800(2) April 29, 1997 7.50
================================================================================
(1) Adjusted to reflect the December 31, 1998, 8% stock dividend.
(2) Adjusted to reflect the December 15, 1997, two for one stock split.
The Board of Directors adopted an amendment to the 1996 Incentive
Stock Option Plan on February 3, 1998, increasing the number of shares available
for issuance to 275,000 shares. The amendment was approved by the shareholders
at the 1998 Annual Meeting. All other terms of the Stock Option Plan remained
unchanged.
PROPOSAL II -- APPROVE AMENDMENT TO ARTICLE VIII -
NUMBER AND TERM, SECTION 3, OF THE ARTICLES OF INCORPORATION
To amend the Articles of Incorporation to eliminate staggered terms
and multiple classes of directors and to provide for the election of directors
for one year rather than three-year terms.
General
On February 18, 1999 the Board of Directors unanimously proposed to
amend ARTICLE VIII, Section 3, of the Articles of Incorporation of the Company
in the form attached hereto as Appendix "A" (the "First Amendment") and
recommended that the shareholders consider and adopt the First Amendment at this
Annual Meeting. If approved by the affirmative vote of the holders of a majority
of the outstanding common stock of the Company, the First Amendment will become
effective upon filing with the Secretary of State of Florida. The First
Amendment will not affect the terms of the directors being elected at this
Annual Meeting nor will it affect the remaining terms of the Continuing Board.
Beginning in the Year 2000 and each year thereafter, directors standing for
election shall be elected for one-year terms. By the year 2002 there will only
be one class of directors.
<PAGE>
Background
The Company was incorporated and its Articles of Incorporation filed
with the Florida Secretary of State on May 24, 1995. The changes proposed in the
First Amendment will give the shareholders more input into and control over the
Company. Staggered terms and multiple classes of directors will be eliminated as
each Class stands for reelection. Thereafter, directors will be elected for one
year rather than three-year terms, making it easier for shareholders to add new
directors, as well as change the composition of the Board of Directors.
Proposed Amendments to the Articles of Incorporation
ARTICLE VIII - NUMBER OF DIRECTORS, Section 3 - Classes. This
provision has been amended to phase out the following the completion of the
current terms by each class, each director shall be elected for a term of
approximately one year.
Adoption of the First Amendment
The First Amendment must be approved by the favorable vote of the
holders of a majority of the shares of common stock outstanding as of the Record
Date for the Annual Meeting. The Board of Directors has unanimously proposed the
First Amendment and recommended its adoption by the shareholders. If approved by
the shareholders, the Company shall file, with the Florida Secretary of State,
the First Amendment, which shall become effective at the time and date of
filing. Proxies solicited by the Board of Directors will be voted in favor of
adoption of the First Amendment, unless the shareholders specify in their
proxies a contrary choice.
- --------------------------------------------------------------------------------
The Board of Directors unanimously recommends that
shareholders vote FOR the adoption of the First Amendment.
- --------------------------------------------------------------------------------
PROPOSAL III -- RATIFICATION OF APPOINTMENT OF
AUDITORS FOR FISCAL YEAR ENDING DECEMBER 31, 1998
The Company's independent auditors since its inception and for the
fiscal year ended December 31, 1998, were Hacker, Johnson, Cohen & Grieb, PA.
The Board of Directors has appointed Hacker, Johnson, Cohen & Grieb, PA to be
its independent auditors for the fiscal year ending December 31, 1999, subject
to shareholder ratification.
- --------------------------------------------------------------------------------
The Board of Directors recommends that shareholders vote
"FOR" the ratification of the appointment of Hacker, Johnson, Cohen &
Grieb, PA as independent auditors for the fiscal year ending December
31, 1999.
- --------------------------------------------------------------------------------
PROPOSAL IV -- ADJOURNMENT OF ANNUAL MEETING
The Company seeks approval to adjourn the Annual Meeting in the event
that the number of proxies sufficient to approve Proposals I, II or III are not
received by April 20, 1999. In order to permit proxies that have been received
by the Company at the time of the Annual Meeting to be voted, if necessary, for
the adjournment, is submitting the question of adjournment to permit further
solicitation of proxies to approve Proposals I, II or III to the shareholders as
a separate matter for your consideration. If it becomes necessary to adjourn the
Annual Meeting, and the adjournment is for a period of less than 30 days, no
notice of the time and place of the adjourned meeting needs to be given to the
shareholders, other than an announcement made at the Annual Meeting.
- --------------------------------------------------------------------------------
The Board of Directors recommends that shareholders vote
"FOR" the approval of the adjournment of the Annual Meeting.
- --------------------------------------------------------------------------------
Solicitation
The cost of soliciting proxies on behalf of the Board of Directors for
the Annual Meeting will be borne by the Company. Proxies may be solicited by
directors, officers or regular employees of the Company or Citizens Bank in
person or by telephone, telegraph or mail. The Company will request persons,
firms and corporations holding shares in their names, or in the names of their
nominees, which are beneficially owned by others, to send proxy materials to and
obtain proxies from such beneficial owners, and will reimburse such holders for
their reasonable out-of-pocket expenses in doing so.
Shareholder Proposals
In order to be eligible for inclusion in the Proxy materials for next
year's Annual Meeting of Shareholders, any shareholder proposal to take action
at such Annual Meeting must be received at the Corporate Office of the Company,
650 East Elkcam Circle, Marco Island, Florida 34145 on or before November 12,
1999. Proposals must comply with the provisions of 17 C.F.R. Section 240.14a-8
("Rule 14a") of the rules and regulations of the Securities and Exchange
Commission in order to be included in the Company's Proxy materials.
New business may be taken up at the Annual Meeting, provided the
proposal is stated in writing and filed with the Corporate Secretary at least
five days before the Annual Meeting. Any shareholder may make any other proposal
at the Annual Meeting and the same may be discussed and considered, but unless
stated in writing and filed with the Corporate Secretary by the above date, such
proposal shall be laid over for action at an adjourned Annual Meeting or at a
Special Meeting taking place 30 or more days thereafter. This provision does not
prevent the consideration and approval or disapproval at the Annual Meeting of
reports of officers, directors, and committees. In connection with such reports,
however, no new business shall be acted upon at such Annual Meeting unless
stated and filed as provided herein.
Financial Statements
The 1998 Annual Report containing consolidated audited financial
statements for the year ended December 31, 1998, accompany this Proxy Statement.
Other Matters
The Board of Directors knows of no other matters to be brought before
the Annual Meeting. If other matters should, however, come before the Annual
Meeting, it is the intention of the persons named in the enclosed Revocable
Proxy to vote the Proxy in accordance with their judgment and in the best
interest of the Company.
CITIZENS COMMUNITY BANCORP, INC.
Marco Island, Florida
March 19, 1999
<PAGE>
APPENDIX "A"
FIRST AMENDMENT TO
THE ARTICLES OF INCORPORATION
OF
CITIZENS COMMUNITY BANCORP, INC.
MARCO ISLAND, FLORIDA
The undersigned officer of Citizens Community Bancorp, Inc. does
hereby certify that pursuant to Section 607.1006, Florida Statutes, the Board of
Directors and holders of at least 66% of the outstanding shares of common stock,
approved the amendment to Article VIII, Section 3, as set forth herein.
Shareholders approval was obtained.
The following amendment is being made pursuant at the 1999 Annual
Meeting of Shareholders. Section 3, of Article VIII of the Articles of
Incorporation which now reads:
ARTICLE VIII - NUMBER OF DIRECTORS
Section 3 - Terms of Directors: Beginning in the year 2002 and each
year thereafter, the terms for directors standing for election shall be for one
year. As the terms of each Class of directors expires, the directors being
nominated shall be elected to serve one-year terms. By the year 2002 there will
only be one Class of directors.
The undersigned has executed this First Amendment to the Articles of
Incorporation on behalf of Citizens Community Bancorp, Inc. on this ___ day of
April, 1999.
Attest: CITIZENS COMMUNITY BANCORP, INC.
_________________________________ By: _________________________________
Richard Storm, Jr.
President and Chief Executive Officer
B-17
<PAGE>
--------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
--------------------
TO OUR SHAREHOLDERS:
The 1998 Annual Meeting of the Shareholders of Citizens Community Bancorp,
Inc. will be held at the Marriott Marco Island Resort and Golf Club, 400 South
Collier Boulevard, Marco Island, Florida on: Tuesday, April 20, 1999 at 10:00
a.m. Eastern Standard Time
for the following purposes:
PROPOSAL I. To elect three (3) Directors for a one-year term expiring in 2002.
PROPOSAL II. To consider and vote upon Amendment to Article VIII, Section 3 of
the Articles of Incorporation of Citizens Community Bancorp, Inc., to eliminate
staggered terms for directors in further elections.
PROPOSAL III. To ratify the appointment of Hacker, Johnson, Cohen & Grieb, PA as
independent auditors of Citizens Community Bancorp, Inc. for the fiscal year
ending December 31, 1999.
PROPOSAL IV. Approve the adjournment of the Annual Meeting to solicit additional
proxies in the event that there are not sufficient votes to approve any one or
more of the foregoing proposals.
o To transact such other business properly coming before the Annual Meeting.
Only those shareholders who were shareholders of record at the close of
business on March 5, 1999, will be entitled to vote in person or by proxy at the
Annual Meeting, or any adjournment thereof. A complete list of these
shareholders will be available for inspection prior to the Annual Meeting at
Citizens Community Bancorp, Inc.'s principal executive officers at 650 East
Elkcam Circle, Marco Island, Florida.
Shareholders are cordially invited to attend the Annual Meeting in person,
but we urge you to complete, sign, and date the enclosed proxy and return it in
the envelope provided as promptly as possible.
By order of the board of directors
-------------------------------------------
Bruce G. Fedor, Corporate Secretary
Marco Island, Florida
March 19, 1999
