SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[x] Preliminary Proxy Statement [ ] Confidential, for Use of the
[ ] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
IBW FINANCIAL CORPORATION
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
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2. Aggregate number of securities to which transaction applies:
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3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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4. Proposed maximum aggregate value of transaction:
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5. Total Fee Paid:
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[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1. Amount Previously Paid:
2. Form, Schedule or Registration Statement No.:
3 Filing Party:
4. Date Filed:
<PAGE>
IBW FINANCIAL CORPORATION
NOTICE OF ANNUAL MEETING
AND
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
APRIL 28, 1998
<PAGE>
IBW FINANCIAL CORPORATION
4812 GEORGIA AVENUE
WASHINGTON, D.C. 20011
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 28, 1998
TO THE SHAREHOLDERS OF IBW FINANCIAL CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of IBW
Financial Corporation, a District of Columbia corporation (the "Company"), will
be held in the Board Room at the Company's executive offices, located at 4812
Georgia Avenue, Washington, D.C., on Tuesday, April 28, 1998 at 5:00 pm for the
following purposes:
1. To elect nine (9) directors to serve until the next Annual Meeting of
Shareholders and until their successors are duly elected and
qualified;
2. To consider and vote upon a resolution to amend the bylaws to impose a
mandatory retirement age for directors of the Company; and
3. To transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.
Shareholders of record as of the close of business on March 24, 1998 are
entitled to notice of and to vote at the Annual Meeting or any adjournment or
postponement thereof.
By Order of the Board of Directors
Clinton W. Chapman, Chairman
March 31, 1998
PLEASE SIGN, DATE AND RETURN YOUR PROXY PROMPTLY, WHETHER OR NOT YOU
PLAN TO ATTEND THE MEETING IN PERSON. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES IN THE ENCLOSED ENVELOPE. IF YOU ATTEND THE
MEETING, YOU MAY, IF YOU DESIRE, REVOKE YOUR PROXY AND VOTE IN PERSON.
<PAGE>
IBW FINANCIAL CORPORATION
4812 Georgia Avenue
Washington, DC 20011
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ANNUAL MEETING OF SHAREHOLDERS
PROXY STATEMENT
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INTRODUCTION
This Proxy Statement is furnished to shareholders of IBW Financial
Corporation, a District of Columbia corporation (the "Company"), in connection
with the solicitation of proxies by the Board of Directors of the Company for
use at the Annual Meeting of Shareholders to be held at 5:00 p.m. on April 28,
1998 (the "Annual Meeting"), and at any adjournment or postponement thereof, for
the purposes of (1) electing nine (9) directors to serve until the next Annual
Meeting of Shareholders and until their successors are duly elected and
qualified; (2) considering and voting upon a resolution to amend the bylaws to
impose a mandatory retirement age on directors of the Company; and (3)
transacting such other business as may properly come before the Annual Meeting
or any adjournment or postponement thereof.
The Annual Meeting will be held in the Board Room at the executive offices
of the Company, located at 4812 Georgia Avenue, Washington D.C.
This Proxy Statement and the accompanying form of proxy are being sent to
shareholders of the Company on or about March 31, 1998. A copy of the Annual
Report to Shareholders of IBW Financial Corporation for the year ended December
31, 1997, also accompanies this Proxy Statement.
The cost of this proxy solicitation is being borne by the Company. In
addition to the use of the mail, proxies may be solicited personally or by
telephone by officers, regular employees or directors of the Company or the
Bank, who will not be compensated for any such services. The Company may also
reimburse brokers, custodians, nominees and other fiduciaries for their
reasonable out-of-pocket and clerical costs for forwarding proxy materials to
their principals.
VOTING RIGHTS AND PROXIES
VOTING RIGHTS
Only shareholders of record at the close of business on March 24, 1998,
will be entitled to notice of and to vote at the Annual Meeting or any
adjournment or postponement thereof. On that date, the Company had outstanding
668,360 shares of common stock, par value $1.00 per share (the "Common Stock"),
constituting the only class of stock outstanding, and held by approximately 560
shareholders of record. Each share of Common Stock is entitled to one vote on
all matters submitted to a vote of the shareholders. Shareholders do not have
the right to cumulate votes in the election of directors. Nominees receiving a
plurality of the votes cast at the Annual Meeting in the election of directors
will be elected as director, in the order of the number of votes received. The
presence, in person or by proxy, of not less than a majority of the total number
of outstanding shares of Common Stock is necessary to constitute a quorum at the
Annual Meeting. Members of the Board of Directors, and family members thereof,
having the power to vote or direct the voting of in excess of fifty percent of
the outstanding shares of Common Stock have indicated their intention to vote in
favor of the election of all of the nominees for election as director, and to
vote against the proposal to amend the bylaws to impose a mandatory retirement
age on directors.
PROXIES
Shares represented by proxies received by the Company will be voted in
accordance with the instructions contained therein. Shares represented by
proxies for which no instruction is given will be voted FOR the election
<PAGE>
of the directors specified herein, AGAINST the proposal to amend the bylaws to
impose a mandatory retirement age on directors, and in the discretion of the
holders of the proxies on all other matters properly brought before the meeting
and any adjournment or postponement thereof. The judges of election appointed by
the Board of Directors for the Annual Meeting will determine the presence of a
quorum and will tabulate the votes cast at the Annual Meeting. Abstentions will
be treated as present for purposes of determining a quorum, but as unvoted for
purposes of determining the approval of any matter submitted to the vote of
shareholders. If a broker indicates that he or she does not have discretionary
authority to vote any shares of Common Stock as to a particular matter, such
shares will be treated as present for general quorum purposes, but will not be
considered as present or voted with respect to such matter.
Shareholders are requested to sign, date, mark and return promptly the
enclosed proxy in the postage paid envelope provided for this purpose in order
to assure that their shares are voted. A proxy may be revoked at any time prior
to the voting thereof at the Annual Meeting through the granting of a later
proxy with respect to the same shares, by written notice to B. Doyle Mitchell,
Jr., President of the Company, at the address noted above, at any time prior to
the voting thereof, or by voting in person at the Annual Meeting. Attendance at
the Annual Meeting will not, in itself, revoke a proxy.
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<PAGE>
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
SECURITIES OWNERSHIP OF DIRECTORS, OFFICERS AND CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information as of February 28, 1998
concerning the number and percentage of shares of the Company's Common Stock
beneficially owned by its directors, nominees for director, executive officers
the compensation of which is disclosed herein, and by its directors and all
executive officers as a group, as well as information regarding each other
person known by the Company to own in excess of 5% of the outstanding Common
Stock. Except as otherwise indicated, all shares are owned directly, and the
named person possesses sole voting and sole investment power with respect to all
such shares. Except as set forth below, the Company knows of no other person or
persons, who beneficially own in excess of five percent of the Company's Common
Stock. Further, the Company is not aware of any arrangement which at a
subsequent date may result in a change of control of the Company.
<TABLE>
<CAPTION>
NAME NUMBER OF SHARES(1) PERCENT OF CLASS
---- ------------------- ----------------
<S> <C> <C>
Clinton W. Chapman, Esquire 11,121(2) 1.66%
George H. Windsor, Esquire 16,340(3) 2.44%
Benjamin L. King, CPA 1,176(4) *
B. Doyle Mitchell, Jr. 74,813(5) 11.19%
4812 Georgia Avenue, NW
Washington, DC 20011
Massie S. Fleming 5,233(6) *
Cynthia T. Mitchell 100,763(7) 15.08%
2029 Trumbull Terrace, NW
Washington, DC 20011
Patricia Mitchell 77,407(8) 11.58%
4812 Georgia Avenue, NW
Washington, DC 20011
Marjorie H. Parker, Ph.D 7,521 1.13%
Robert L. White 1,000(9) *
Emerson A. Williams, M.D. 3,646 *
Industrial Bank, National Association 54,720 8.19%
Employee Stock Ownership Plan
4812 Georgia Avenue, NW
Washington, DC 20011
All directors and executive 276,893(10) 41.34%(10)
officers as a group (13 persons)
</TABLE>
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* Less than one percent
(1) For purposes hereof, a person is deemed to be the beneficial owner of
securities with respect to which he has or shares voting or investment
power. Except as otherwise indicated, the named beneficial owner has sole
voting and investment power with respect to all shares beneficially owned
by such person.
(2) Does not include 54,720 shares held by the Industrial Bank of Washington
Employee Stock Ownership Plan ("ESOP") as to which Mr. Chapman is a
co-trustee. Includes 4,200 shares held jointly with spouse, as to which Mr.
Chapman shares voting and investment power.
(Footnotes continued on following page)
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<PAGE>
(Footnotes continued from prior page)
(3) Includes 16,340 shares held by a trust of which Mr. Windsor and his spouse
are trustees. Does not include 2,000 shares held by Mr. Windsor's daughter,
and as to which Mr. Windsor disclaims beneficial ownership.
(4) Does not include 54,720 shares held by ESOP as to which Mr. King is a
co-trustee.
(5) Includes 72,813 shares held in a revocable trust of which Mr. Mitchell is
the trustee, and Mr. Mitchell's spouse and son are beneficiaries. Does not
include shares held by Mrs. Cynthia Mitchell as trustee for Mr. Mitchell
and Ms. Mitchell. Does not include 1,500 shares held by Mr. Mitchell's
spouse. Does not include 54,720 shares held by ESOP as to which Mr.
Mitchell is a co-trustee.
(6) Includes 233 shares held jointly with son and as to which Mrs. Fleming
shares voting and investment power.
(7) Includes shares held by three trusts of which Mrs. Mitchell is trustee, and
with respect to one of which Mr. Mitchell and Ms. Mitchell are
beneficiaries.
(8) Includes shares held in a revocable trust of which Ms. Mitchell is the
trustee, and of which Mr. Mitchell is the beneficiary. Does not include
shares held by Mrs. Cynthia Mitchell as trustee for Mr. Mitchell and Ms.
Mitchell. Ms. Mitchell is an employee of the Bank.
(9) Includes 800 shares held jointly with spouse and as to which Mr. White
shares voting and investment power.
(10) Includes 54,720 shares held by ESOP as to which Messrs. Chapman, King and
Mitchell are trustees. If these shares were not included, the directors and
executive officers as a group would beneficially own 222,173 shares, or
33.24% of the outstanding shares of Common Stock. Does not include shares
held by Ms. Mitchell.
ELECTION OF DIRECTORS
The Company's bylaws set the size of the Board of Directors at ten
directors. There is currently one (1) vacancy on the Board of Directors,
resulting from the retirement of Mrs. Margaret B. Stewart from the Board of
Directors in February 1998, after sixteen (16) years of service with the Company
and the Bank. The Board of Directors has nominated nine (9) directors for
election at the Annual Meeting, for a one-year period until the 1999 Annual
Meeting of Shareholders and until their successors have been elected and
qualified. The Board of Directors is conducting a search for qualified people to
join the Board of Directors, and intends to fill the vacancy by action of the
Board of Directors following the Meeting. Each of the nominees for election as a
director currently serves as a member of the Board of Directors. Unless
authority is withheld, all proxies in response to this solicitation will be
voted for the election of the nominees listed below. Each nominee has indicated
a willingness to serve if elected. However, if any nominee becomes unable to
serve, the proxies received in response to this solicitation will be voted for a
replacement nominee selected in accordance with the best judgment of the proxy
holders named therein.
The Board of Directors recommends that shareholders vote FOR each of the
nominees to the Company's Board of Directors.
NOMINEES FOR ELECTION AS DIRECTORS
Set forth below is certain information as of the Record Date concerning the
nominees for election as director of the Company. Except as otherwise indicated,
the occupation listed has been such person's principal occupation for at least
the last five years. Each of the members of the Board of Directors of the
Company has served since the organization of the Company in 1994. The longevity
of service listed below reflects service on the Board of Directors of Industrial
Bank, National Association (the "Bank"), the Company's sole subsidiary,
including service prior to the conversion of the Bank to a national banking
association. Each of the directors of the Company also currently serves as a
director of the Bank.
Clinton W. Chapman, 73, Chairman of the Board of Directors, has served as a
director since 1984. Mr. Chapman, an attorney with Clinton Chapman and
Associates since 1997, and Chapman and Chapman, P.C. prior to that time, has
been engaged in the private practice of law for more than thirty years.
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<PAGE>
George H. Windsor, 79, Vice Chairman of the Board of Directors, has served
as a director since 1969. Mr. Windsor, an attorney with Cobb, Howard, Hayes and
Windsor, has been in private law practice for twenty-six years.
Benjamin L. King, C.P.A., 70 is Secretary of the Company and has served as
a director since 1972. Mr. King is a certified public accountant, and is
self-employed as a management and tax consultant.
B. Doyle Mitchell, Jr., 35, President of the Company, has served as a
director since 1990. Mr. Mitchell has served as President of the Bank since
March 1993. Prior to that date, he served in various executive and
administrative positions at the Bank since 1983, including as Vice
President-Commercial Lending from 1991 to 1993 and Assistant Vice
President-Commercial Lending from 1989 to 1991. Mr. Mitchell is the son of Mrs.
Cynthia Mitchell, a director of the Bank, and the late B. Doyle Mitchell, a
founder of the Bank. Mr. Mitchell's sister, Patricia Mitchell, is a significant
shareholder and an employee of the Bank.
Massie S. Fleming, 71, has served as a director since 1985. Mrs. Fleming
retired at the end of 1997 from her position as Executive Vice President of the
Bank, a position she had held since 1985. Prior to that date, she served in
various executive and administrative positions at the Bank since 1959, including
as Chief Executive Officer from 1985 to mid 1997.
Cynthia T. Mitchell, 71, has served as a director since 1993. Mrs. Mitchell
is retired. Until 1982 she was a teacher in the District of Columbia public
schools system. Mrs. Mitchell's late husband was a founder of the Bank. Mrs.
Mitchell's son is B. Doyle Mitchell Jr., the President of the Bank, and her
daughter Patricia Mitchell, is a significant shareholder and an employee of the
Bank.
Marjorie H. Parker, PhD., 81, has served as a director since 1975. Dr.
Parker is a retired educator. Until 1975 she was the Chairman of the Board of
Trustees of the University of the District of Columbia.
Robert L. White, 81, has served as a director since 1982. Mr. White is
retired. Until 1989 he served as President of NAPFE, a national labor union
representing postal and federal workers.
Emerson A. Williams, M.D., 81, has served as a director since 1975. Mr.
Williams is retired from the active practice of medicine. For many years he
served as an instructor at Howard University School of Medicine.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of the Company met twelve (12) times during 1997.
All members of the Board of Directors, attended at least 75% of the meetings
held by the Board of Directors and by all committees on which such member served
during the 1997 fiscal year or any portion thereof.
The Board of Directors has a standing Audit Committee. The Board of
Directors does not have a standing Nominating Committee or Compensation
Committee,the functions of which are performed by the Executive Committee. The
Company also has a standing Loan and Discount Committee.
The Audit Committee, presently composed of Mrs. Fleming, Mrs. Mitchell and
Messrs. Chapman, King, Mitchell and White, is responsible for the review and
evaluation of the Company's/Bank's internal controls and accounting procedures.
It also periodically reviews audit reports with the Company's independent
auditors, and recommends the annual appointment of such auditors. During the
1997 fiscal year, the Audit Committee met four (4) times.
The Executive Committee, presently composed of Dr. Parker, Mrs. Fleming and
Messrs. Chapman, Mitchell and Windsor serves the function of a compensation and
personnel committee. In that capacity, it is responsible, together with
management, for the adoption of the Bank's personnel policies and establishing
salary and
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<PAGE>
compensation guidelines and levels for all Company officers and personnel. The
Committee is also responsible for annually nominating the officers of the Bank
and evaluating the performance thereof. During the 1997 fiscal year, the
Compensation Committee met three (3) times.
DIRECTORS' COMPENSATION
Each director of the Company, including directors who are full time
employees of the Company or the Bank, receives $600 for each regular meeting of
the Board of Directors attended, with the exception of Mr. Chapman, Chairman of
the Board who receives $1,500 for each regular meeting which he attends and a
$5,000 annual fee. Additionally, directors who are not employees, serving on
committees of the Board, receive $400 for each meeting attended, except if such
service is as chairman of any committee, in which case such director receives
$500 for each meeting. Total fees paid to directors in 1997 for Board and
committee meeting attendance was $183,600.
EXECUTIVE COMPENSATION
The following table sets forth a summary of certain information relating to
the compensation of the President and the Executive Vice-President of the
Company. All compensation paid to Mr. Mitchell and Mrs. Fleming was for services
rendered in their capacities as officers of the Bank. Except as disclosed below,
no executive officer of the Company or the Bank received salary and bonus in
excess of $100,000 in 1997.
ANNUAL COMPENSATION(1)
<TABLE>
<CAPTION>
Other
Name and Principal Position Year Ended December 31 Salary Bonus Compensation(2)
--------------------------- ---------------------- ------ ----- ---------------
<S> <C> <C> <C> <C>
B. Doyle Mitchell 1997 $113,400 $2,398 $7,800
President & Director 1996 113,400 17,955 7,800
1995 90,000 2,360 7,800
Massie S. Fleming 1997 $91,160 $2,283 $7,800
Executive Vice President & 1996 91,160 5,729 7,800
Director 1995 86,000 2,590 7,800
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</TABLE>
(1) The Company does not maintain any long-term or stock-based compensation
plans.
(2) Represents fees paid for attendance at meetings of Board of Directors and
committees thereof. Does not include vehicle allowances of $6,162, $4,100
and $3,842 in 1997, 1996 and 1995 respectively, in the case of Mr.
Mitchell, and of $5,600, $5,600 and $5,600 paid to Mrs. Fleming in 1997,
1996 and 1995, respectively. Also does not include value of contributions
to the Bank's employee stock ownership plan estimated at $1,100, $1,086 and
$1,762, and $1,000, $851 and $1,736 for Mr. Mitchell and Mrs. Fleming,
respectively, in 1997, 1996 and 1995. Does not include Bank paid membership
fees of approximately $350 for Mr. Mitchell, or of insurance premiums for
policies on Mr. Mitchell's life, of which the Bank and Mr. Mitchell's
spouse are co-beneficiaries. Does not include bonus of $10,000 to be paid
in 1998 for services rendered by Mr. Mitchell in 1997.
Employment Agreements. As of December 31, 1997, neither the Bank nor the
Company had any employment agreements or other compensation contracts or other
arrangements in existence. Under the terms of the Company's loan agreement
relating to the interim capital assistance incurred in connection with the
Bank's 1994 deposit assumption transaction with the Resolution Trust Corporation
(the "RTC"), the Bank may not grant any salary increase, or pay any bonuses to,
its directors, officers or key employees, except that it may do so during and
after the second year of the interim capital assistance with the prior approval
of the RTC. Mr. Mitchell's salary was raised to an annual rate of $150,000,
effective January 1, 1998.
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<PAGE>
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Set forth below is certain information regarding persons who are executive
officers of the Company or the Bank. Except as otherwise indicated, the
occupation listed has been such person's principal occupation for at least the
last five years.
Lester Johnson, 52, was promoted to Chief Credit Officer of the Bank in
April 1995, and to Senior Vice President in January 1996. Mr. Johnson joined the
Bank as a Vice President and Commercial Loan Officer in January 1988.
David G. Poole, 61, has served as Senior Vice President-Operations of the
Bank since 1983.
Richard Williams, 38, has served as Senior Vice President-Chief Lending
Officer since July 1995. Mr. Williams joined the Bank as a Vice President and
Commercial Loan Officer in October 1988.
Thomas A. Wilson, 46, has served as Senior Vice President-Controller of the
Bank since January 1992. Prior to serving in this position he served (since
April 1986) at various times as Commercial Loan Manager and Loan Review Officer
of the Bank. Prior to joining the Bank in 1986, he served as a National Bank
Examiner with the OCC from 1974 to 1986.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Bank has had, and expects to have in the future, banking transactions
in the ordinary course of business with some of its and the Company's directors,
officers, and employees and their associates. In the past, substantially all of
such transactions have been on the same terms, including interest rates,
maturities and collateral requirements as those prevailing at the time for
comparable transactions with non-affiliated persons and did not involve more
than the normal risk of collectibility or present other unfavorable features.
The maximum aggregate amount of loans to officers, directors and affiliates
of the Company during 1997 amounted to $786,000, representing approximately 4%
of the Company's total shareholders' equity at December 31, 1997. In the opinion
of the Board of Directors, the terms of these loans are no less favorable to the
Bank than terms of the loans from the Bank to unaffiliated parties. On December
31, 1997, no loans were outstanding to individuals who, during 1997, were
officers, directors or affiliates of the Company. At the time each loan was
made, management believed that the loan involved no more than the normal risk of
collectibility and did not present other unfavorable features. None of such
loans were classified as Substandard, Doubtful or Loss. Under the terms of the
interim capital assistance agreement, the Bank may not, during the term of the
interim capital assistance loan, make any loan or advance to the Company or any
affiliate of the Bank or Company, or enter into any transaction (other than
arm's length deposit transactions in the ordinary course of business) with such
persons.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934.
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of
the Common Stock, to file reports of ownership and changes in ownership on Forms
3, 4 and 5 with the Securities and Exchange Commission, and to provide the
Company with copies of all Forms 3, 4, and 5 they file.
Based solely upon the Company's review of the copies of the forms which it
has received and written representations from the Company's directors, executive
officers and ten percent shareholders, the Company is not aware of any failure
of any such person to comply with the requirements of Section 16(a).
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<PAGE>
PROPOSAL TO AMEND THE BYLAWS
At the 1997 annual meeting of shareholders, comments were made by
shareholders which expressed the concern that the majority of the members of the
Board of Directors of the Company were too old, and requested that the issue of
imposing a mandatory retirement age for the directors be presented to the
shareholders. No vote was taken at that meeting as the proposal was ruled out of
order, and untimely. However, the issue was submitted to the Executive Committee
of the Board of Directors for study. The Board of Directors has elected to
follow the recommendation of the committee that the issue be presented to the
shareholders at the Annual Meeting, in the form of a proposed amendment to the
bylaws, in order to obtain an accurate reading of the views of the Company's
shareholders on the issue. The Executive Committee also recommended that the
issue be presented with the recommendation to shareholders that the amendment
not be adopted.
The proposed amendment to the bylaws, the full text of which appears below,
would have the effect of precluding any person of 70 years or older from
standing or being nominated for election, reelection, appointment or
reappointment as a director of the Company. Any person who reaches the age of 70
while sitting on the Board of Directors would be entitled to complete his or her
term. If approved , the amendment would become effective for the election of
directors to be held at the annual meeting of shareholders in 1999.
The proposed amendment would add a new paragraph to Section 3.01 of the
bylaws reading in its entirety as follows:
"Commencing with the annual meeting of stockholders to be
held in 1999, and notwithstanding anything to the contrary
contained herein, no person of an age 70 years or older will
be eligible for election, reelection, appointment or
reappointment as a member of the Board of Directors of the
corporation, and no director shall serve as such beyond the
annual meeting of stockholders of the corporation
immediately following the attainment of the age of 70."
RECOMMENDATION OF THE BOARD OF DIRECTORS
Although the Board of Directors has submitted the proposed amendment for
the consideration and vote of shareholders, neither the Board of Directors nor
management of the Company believe that the proposed amendment is in the best
interests of the Company and its shareholders. The Board of Directors and
management recognize that all but one of the members of the Board of Directors
is 70 years of age or more. However, the Board and management believe that the
proposed amendment, which would require the retirement of all of those directors
at the next annual meeting, would be detrimental to the Company in that it would
require a radical restructuring of the Board of Directors, deprive the Company
of the experience, knowledge, judgment, wisdom and institutional memory of the
directors, and present the Company with a new Board, most of the members of
which would be largely unfamiliar with the Company's operations. The Board of
Directors and management do not agree that age is a sign of inability to
continue to provide capable service and leadership to the Company. As
shareholders and long-time supporters of the Company and the Bank, each of the
directors places the best interest of the Company and the Bank, above their
personal interest in continuing as a member of the Board of Directors. The Board
of Directors and management believe that the indiscriminate and radical approach
epitomized by the proposed amendment and its underlying concerns would be a
disservice to the Company and its shareholders.
The Board of Directors has long considered its advancing age and has
prepared a reasoned and evolutionary approach to succession issues. Management
has been instructed to conduct an informal search among the constituencies which
the Company and the Bank serve for individuals with the skills, acumen, judgment
and commitment to community and shareholder service to which the present Board
aspires. Once appropriate individuals have been identified, the Company plans to
add such persons to the Board of the Company and/or the Bank, in order to allow
them to acclimate themselves to service on the Company's boards, without
overwhelming the ability of the Company to assimilate new directors, and without
any decrease in the efficiency or operations of the Company. As
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<PAGE>
more such individuals are included on the Board, and as existing directors
retire, the average age of the Board will decrease. The Board would welcome
suggestions as to possible candidates from the shareholders.
Recommendation and Vote Required. Approval of the proposed amendment
requires to vote of not less than a majority of the shares represented at the
Annual Meeting. For the reasons set forth above, the Board of Directors and
Management recommend that shareholders vote AGAINST the proposed amendment.
Directors and officers of the Company and the Bank and family members thereof
having the power to vote in excess of fifty percent of the outstanding shares
have indicated that they intend to vote against the proposed amendment. As such
there is no possibility that the proposal will be approved.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Deloitte & Touche, L.L.P., independent
public accountants, to audit the Company's financial statements for the fiscal
year ending December 31, 1998. Deloitte and Touche, L.L.P. (or its predecessor
firm, Touche Ross & Company) has audited the financial statements of the Company
since its organization and of the Bank since 1977. Representatives of Deloitte &
Touche, L.L.P. are expected to be present at the Annual Meeting and available to
respond to appropriate questions/are not expected to be present at the Annual
Meeting. The representatives also will be provided with an opportunity to make a
statement, if they desire.
FORM 10-KSB ANNUAL REPORT
THE COMPANY WILL PROVIDE, WITHOUT CHARGE, TO ANY SHAREHOLDER OF RECORD
ENTITLED TO VOTE AT THE MEETING OR ANY BENEFICIAL OWNER OF COMMON STOCK
SOLICITED HEREBY, A COPY OF ITS 1997 ANNUAL REPORT ON FORM 10-KSB FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, UPON THE WRITTEN REQUEST OF SUCH
SHAREHOLDER. REQUESTS SHOULD BE DIRECTED TO THOMAS A. WILSON, JR., SENIOR VICE
PRESIDENT AND CONTROLLER, IBW FINANCIAL CORPORATION, 4812 GEORGIA AVENUE, NW,
WASHINGTON, DC 20011.
OTHER MATTERS
The Board of Directors of the Company is not aware of any other matters to
be presented for action by shareholders at the Annual Meeting. If, however, any
other matters not now known are properly brought before the meeting or any
adjournment thereof, the persons named in the accompanying proxy will vote such
proxy in accordance with their judgment on such matters.
SHAREHOLDER PROPOSALS
All proposals or nominations for election as directors by shareholders, to
be presented for consideration at the next annual meeting must be received by
the Company no later than December 1, 1998.
By Order of the Board of Directors
Clinton W. Chapman, Chairman
March 31, 1998
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FRONT REVOCABLE PROXY
IBW FINANCIAL CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby makes, constitutes and appoints Mervin O. Parker,
Sr., Ernestine G. Mann and Frances S. Wash, and each of them (with the power of
substitution), proxies for the undersigned to represent and to vote, as
designated below, all shares of common stock of IBW Financial Corporation (the
"Company ") which the undersigned would be entitled to vote if personally
present at the Company's Annual Meeting of Shareholders to be held on April 28,
1998 and at any adjournment or postponement thereof.
ELECTION OF DIRECTORS
[ ] FOR all nominees listed below (except as noted to the contrary below)
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below
Nominees: Clinton W. Chapman, Esquire; George H. Windsor, Esquire;
Benjamin L. King, C.P.A.; B. Doyle Mitchell, Jr.; Massie S.
Fleming; Cynthia T. Mitchell; Marjorie H. Parker, Ph.D.;
Robert L. White; Emerson A. Williams, M.D.
(Instructions: To withhold authority to vote for any individual nominee,
write that nominee's name in the space provided below.)
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PROPOSAL TO AMEND THE BYLAWS
[ ] FOR [ ] AGAINST [ ] ABSTAIN the proposal to amend the Bylaws of
the Company to impose a mandatory retirement age for directors of the Company.
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made, this proxy will be
voted FOR all of the nominees set forth above and AGAINST the proposal to amend
the Bylaws. In addition, this proxy will be voted at the discretion of the proxy
holder(s) upon any other matter which may properly come before the Annual
Meeting or any adjournment or postponement thereof.
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BACK
Important: Please date and sign your name as addressed, and return this proxy in
the enclosed envelope. When signing as executor, administrator, trustee,
guardian, etc., please give full title as such. If the shareholder is a
corporation, the proxy should be signed in the full corporate name by a duly
authorized officer whose title is stated.
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Signature of Shareholder
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Signature of Shareholder
Dated:_________________, 1998
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
