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 the Commission Only (as permitted by Rule
14a-6(e)(2))
{X} Definitive Proxy Statement
{ } Definitive Additional Materials
{ } Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
WINTRUST FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(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)(1) 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 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>
WINTRUST FINANCIAL CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 25, 2000
The 2000 Annual Meeting of Shareholders of Wintrust Financial
Corporation will be held at the Michigan Shores Club, 911 Michigan Avenue,
Wilmette, Illinois 60091, on Thursday, May 25, 2000, at 10:00 a.m. local time,
for the following purposes:
1. To elect eight Class I directors to hold office for a three-year
term;
2. To consider a proposal to amend the Wintrust Financial
Corporation 1997 Stock Incentive Plan to increase the number of
shares authorized under the Plan;
3. To transact such other business as may properly come before the
Meeting and any adjournment thereof.
The record date for determining shareholders entitled to notice of, and to vote
at, the Meeting is the close of business on April 3, 2000. To make it easier for
you to vote, we are introducing internet and telephone voting. The instructions
printed on your proxy card describe how to use these convenient services. Of
course, if you prefer, you can vote by mail by completing your proxy card and
returning it in the enclosed postage-paid envelope.
By order of the Board of Directors,
David A. Dykstra
Secretary
April 20, 2000
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, IT IS IMPORTANT THAT YOU
VOTE BY ONE OF THE METHODS NOTED ABOVE.
<PAGE>
WINTRUST FINANCIAL CORPORATION
727 North Bank Lane
Lake Forest, Illinois 60045
PROXY STATEMENT
FOR THE 2000 ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD THURSDAY, MAY 25, 2000
These proxy materials are furnished in connection with the solicitation
by the Board of Directors of Wintrust Financial Corporation (the "Company"), an
Illinois corporation, of proxies to be used at the 2000 Annual Meeting of
Shareholders of the Company and at any adjournment of such meeting.
You are cordially invited to attend the Company's Annual Meeting of
Shareholders to be held on May 25, 2000, at 10:00 a.m., at the Michigan Shores
Club, 911 Michigan Avenue, Wilmette, Illinois 60091.
PROXIES, OUTSTANDING VOTING SECURITIES, AND SHAREHOLDERS ENTITLED TO VOTE
The Board of Directors has fixed the close of business on April 3, 2000
as the record date for determining shareholders entitled to notice of, and to
vote at, the Annual Meeting. On the record date, the Company had outstanding
8,752,643 shares without par value Common Stock ("Common Stock"). Each
outstanding share of Common Stock entitles the holder to one vote.
Representation at the meeting of a majority of shares will constitute a quorum.
Proxies received from shareholders in proper form will be voted at the
meeting and, if specified, as directed by the shareholder. Unless contrary
instructions are given, the proxy will be voted at the meeting FOR the election
of each of the nominees for Class I Director as set forth below, FOR approval of
the amendment to the 1997 Stock Incentive Plan and, in accordance with the best
judgment of the persons voting the proxies, with respect to any other business
which may properly come before the meeting and is submitted to a vote of the
shareholders. Under Illinois law and the Company's By-laws, directors are
elected by a plurality of votes cast. Approval of Proposal No. 2 requires the
affirmative vote of a majority of the shares present in person or represented by
proxy at the meeting and entitled to vote. Therefore abstentions will have the
effect of voting against Proposal No. 2. With respect to brokers who are
prohibited from exercising discretionary authority for beneficial owners who
have not returned proxies to the brokers, those shares WILL NOT be included in
--------
the vote totals, although both abstentions and broker non-votes are counted as
shares present for the purpose of determining whether the shares represented at
the meeting constitute a quorum. A proxy may be revoked at any time prior to its
exercise by means of a written revocation or submission of a properly executed
proxy bearing a later date. Shareholders of record having executed and returned
a proxy who attend the meeting and desire to vote in person are requested to so
notify the Secretary of the Company prior to or at the time of a vote taken at
the meeting.
YOUR VOTE IS IMPORTANT. Because many shareholders cannot personally
----------------------
attend the Annual Meeting, it is necessary that a large number be represented by
proxy. Whether or not you plan to attend the meeting in person, prompt voting
will be appreciated. This year, registered shareholders can vote their shares
via the Internet or by using a toll-free telephone number. Instructions for
using these convenient new services are provided on the proxy card. Of course,
you may still vote your shares on the proxy card. To do so, we ask that you
complete, sign, date and return the enclosed proxy card promptly in the
postage-paid envelope.
This Proxy Statement is being mailed to shareholders on or about April
20, 2000.
<PAGE>
COST OF PROXY SOLICITATION
The cost of soliciting proxies has been or will be borne by the
Company. Directors, officers, employees and agents of the Company may solicit
proxies in person or by mail, telephone, facsimile transmission and other means.
Directors, officers and employees will receive no additional compensation for
solicitation services. Brokerage houses, nominees, fiduciaries and other
custodians have been requested to forward soliciting materials to the beneficial
owners of shares of record held by them and will be reimbursed for their
expenses.
PROPOSAL NO. 1
ELECTION OF DIRECTORS AND OWNERSHIP OF SHARES
The By-laws of the Company provide that the number of directors of the
Company shall be 24, divided into three classes of eight Directors who are
elected to hold office for staggered three-year terms. Each year the
shareholders elect members of one class of Directors for a term of three years.
The term of office of those persons currently serving as Class I Directors will
expire at this Annual Meeting of Shareholders. The term of those persons
currently serving as Class II Directors expires at the Annual Shareholder
Meeting to be held in 2001; and the term of Class III Directors expires at the
Annual Shareholder Meeting to be held in 2002. In January 2000, Mr. John Leopold
was appointed by the Board of Directors to fill a Class I vacancy. Currently,
there are 24 members of the Board of Directors.
The eight persons named below have been nominated for election as Class
I directors for a term to end at the Annual Meeting of Shareholders in the year
2003 or until their successors are elected and qualified. All of the nominees
currently serve as Class I directors except nominee Ms. Dorothy Mueller who is a
director of the Company's subsidiary, Crystal Lake Bank & Trust Company. Each
nominee has indicated a willingness to serve, and the Board of Directors has no
reason to believe that any of the nominees will not be available for election.
However, if any of the nominees is not available for election, proxies may be
voted for the election of other persons selected by the Board of Directors.
Proxies cannot, however, be voted for a greater number of persons than the
number of nominees named. Shareholders of the Company have no cumulative voting
rights with respect to the election of directors.
The following sections set forth the names of nominees, continuing
directors of each class, their ages, a brief description of their recent
business experience, including present occupation and employment, certain
directorships held by each, and the year in which they became directors of the
Company. Director positions in the Company's subsidiaries are included in the
biographical information set forth below. Such subsidiaries include Lake Forest
Bank & Trust Company ("Lake Forest Bank"), Hinsdale Bank & Trust Company
("Hinsdale Bank"), North Shore Community Bank & Trust Company ("North Shore
Bank"), Libertyville Bank & Trust Company ("Libertyville Bank"), Barrington Bank
& Trust Company, N.A. ("Barrington Bank"), Crystal Lake Bank & Trust Company,
N.A. ("Crystal Lake Bank"), Crabtree Capital Corporation ("Crabtree"), First
Insurance Funding Corp. ("FIFC"), Wintrust Asset Management Company, N.A.
("WAMC"), and Tricom, Inc. of Milwaukee ("Tricom").
NOMINEES TO SERVE AS CLASS I DIRECTORS UNTIL THE ANNUAL
MEETING OF SHAREHOLDERS IN THE YEAR 2003
JAMES E. MAHONEY (62), DIRECTOR SINCE 1996 From 1978 to present, Mr. Mahoney has
been the owner and President of Heidi's Cheese Products, Inc., Mundelein,
Illinois. Mr. Mahoney is a Director of Libertyville Bank.
JAMES B. MCCARTHY (48), DIRECTOR SINCE 1996 From 1991 to present, Mr. McCarthy
has been Chairman and Chief Executive Officer of Gemini Consulting Group, Inc.,
Oak Brook, Illinois, an international management consulting firm focusing on the
health care industry. Mr. McCarthy is a Director of Hinsdale Bank.
- 2 -
<PAGE>
John W. Leopold (56), DIRECTOR SINCE 2000 From 1989 to present, Mr. Leopold has
been President of Tricom, Inc. of Milwaukee, the newly acquired financial
services subsidiary of the Company. Mr. Leopold serves as a Director of the
National Technical Services Association. Mr. Leopold is a Director of Tricom.
DOROTHY M. MUELLER (45), DIRECTOR NOMINEE For the past 23 years, Ms. Mueller has
been Vice President of Mark I Construction, Crystal Lake, Illinois, a custom
home building company. Ms. Mueller is a Director of Crystal Lake Bank.
THOMAS J. NEIS (51), DIRECTOR SINCE 1999 Mr. Neis is the owner of Neis Insurance
Agency, Inc., Longaker Insurance Agency and Neis Insurance Consultants, Inc. and
is an independent insurance agent with these companies. He serves as a director
of the McHenry County Fondation, the McHenry County Economic Development Corp.
and several other charitable and fraternal organizations. Mr. Neis is a Director
of Crystal Lake Bank.
J. CHRISTOPHER REYES (46), DIRECTOR SINCE 1996 Mr. Reyes is Chairman of Reyes
Holdings which owns businesses in beverage distribution, food distribution and
processing with headquarters in Lake Forest, IL. Mr. Reyes serves on the board
of directors of Dean Foods Co., the Boys & Girls Clubs of Chicago and the
Children's Memorial Hospital. Mr. Reyes is a Director of Lake Forest Bank.
PETER P. RUSIN (47), DIRECTOR SINCE 1997 Since 1994, Mr. Rusin has served as
Executive Director of JFK Health World, a not for profit children's health
education center and museum, located in Barrington, Illinois. Mr. Rusin is a
Director of Barrington Bank.
EDWARD J. WEHMER (46), DIRECTOR SINCE 1996 Since May 1998, Mr. Wehmer has served
as President and Chief Executive Officer of Wintrust Financial Corporation.
Prior to May 1998, he served as President and Chief Operating Officer of the
Company since its formation in 1996. He served as the President of Lake Forest
Bank from 1991 to 1998. He was one of the principal organizers of each of the
banking subsidiaries and serves as Chairman or Vice Chairman and a Director of
each of the subsidiary Banks, FIFC, WAMC and Tricom. Prior to joining the
Company, Mr. Wehmer was, from 1985 to 1991, Senior Vice President, Chief
Financial Officer, and a director of River Forest Bancorp, Chicago, Illinois.
Mr. Wehmer is also a certified public accountant and earlier in his career spent
seven years with the accounting firm of Ernst & Young LLP specializing in the
banking field and particularly in the area of bank mergers and acquisitions. Mr.
Wehmer is involved in several other charitable and fraternal organizations.
CLASS II - CONTINUING DIRECTORS SERVING UNTIL THE YEAR 2001
BRUCE K. CROWTHER (48), DIRECTOR SINCE 1998 Mr. Crowther has served as President
and Chief Executive Officer of Northwest Community Healthcare, Northwest
Community Hospital and certain of its affiliates since January 1992. Prior to
that time he served as Executive Vice President and Chief Operating Officer from
1989 to 1991. He is a Fellow of the American College of Healthcare Executives.
Mr. Crowther is the past Chairman of the Board of Directors of the Illinois
Hospital and Health Systems Association as well as a member of the boards of
directors of the Chicago Hospital Risk Pooling Program and Dianon Systems, Inc.
Mr. Crowther is a Director of Barrington Bank.
MAURICE F. DUNNE, JR. (73), DIRECTOR SINCE 1996 Mr. Dunne has been the President
of Maurice F. Dunne Ltd., an educational consulting firm, since September 1991.
Prior thereto, he served as President of the Lake Forest Graduate School of
Management, Lake Forest, Illinois for more than 25 years. Mr. Dunne also served
as the chief operating officer of the Northern Illinois Business Association
from September 1991 to June 1993. Mr. Dunne is a Director of Lake Forest Bank
and North Shore Bank.
WILLIAM C. GRAFT (38), DIRECTOR SINCE 1997 Since December 1999, Mr. Graft is the
founding managing partner of Graft, Sciaccotta & Associates, a law firm with a
practice concentrated in general corporate matters, commercial litigation,
finance and complex commercial real estate law. From April 1996 to December 1999
he was the sole
- 3 -
<PAGE>
shareholder and President of his law firm. Until December 1995, Mr. Graft was a
partner in the national law firm of Keck Mahin & Cate. Mr. Graft is also a
principal and general partner of several real estate investment partnerships and
corporations actively owning and developing commercial and medical real estate
facilities. He serves on the Good Shepherd Hospital Development Council, is
President of the Board of Directors of the Barrington Area Arts Council and
serves as a director of several other private business enterprises. Mr. Graft is
a Director of Barrington Bank.
MARGUERITE SAVARD MCKENNA (57), DIRECTOR SINCE 1996 Ms. McKenna, an attorney,
has practiced law in Wilmette since 1983. She is a member of the Rotary Club,
the Wilmette Chamber of Commerce, the North Suburban Bar Assoc. and President of
New Trier High School Parents Association. Ms. McKenna is a Director of North
Shore Bank.
ALBIN F. MOSCHNER (47), DIRECTOR SINCE 1996 Since December 1999, Mr. Moschner
has been President and Chief Executive Officer of One Point Services, LLC, a
telecommunications company. From September 1997 to November 1999, he served as
President and Chief Executive Officer of Millecom, LLC, a developmental stage
internet communications company. From August 1996 to August 1997, he served as
Vice Chairman and director and an officer of Diba, Inc., a development stage
internet technology company. Mr. Moschner served as President and CEO and a
director of Zenith Electronics, Glenview, Illinois, from 1991 to July 1996. Mr.
Moschner is also a director of Polaroid Corporation and Pella Windows
Corporation. Mr. Moschner serves as a Director of Lake Forest Bank.
INGRID S. STAFFORD (46), DIRECTOR SINCE 1998 Ms. Stafford has held various
positions since 1977 with Northwestern University, where she is currently
Associate Vice President for Finance and Controller. She has been a Director of
Wittenberg University since 1993 and serves as its Vice Chair. She is a member
of the National Association of College and University Business Officers. Ms.
Stafford is the Chair of Leadership Evanston and a board member of the Evanston
Community Foundation. She is also the former President of the Board of Directors
of Childcare Network of Evanston and former chair of the Board of Directors of
the Evanston McGaw YMCA. Ms. Stafford is a Director of North Shore Bank.
JANE R. STEIN (55), DIRECTOR SINCE 1996 Since 1983, Ms. Stein has been the
Executive Director of the Lake County Medical Society, Vernon Hills, Illinois, a
not-for-profit professional association for physicians in Lake County. Since
February, 1999, she has been the Executive Director of the Illinois Society of
Oral and Maxillofacial Surgeons. Ms. Stein also serves as President of Marble
House, Ltd., a management education and consulting firm. She is also the past
president of the Chicago Association of Healthcare Executives. Ms. Stein is a
Director of Libertyville Bank.
KATHARINE V. SYLVESTER (60), DIRECTOR SINCE 1996 Since November 1997, Ms.
Sylvester has been the Office Manager for Fibrex Sales, Ltd. Ms. Sylvester has
been active in civic affairs in the Hinsdale area for many years. She is on the
Board of Trustees of the Hinsdale Community House and is an Associate Member of
the Women's Auxiliary of the Robert Crown Center for Health Education. Ms.
Sylvester is a Director of Hinsdale Bank and Tricom.
CLASS III - CONTINUING DIRECTORS SERVING UNTIL THE YEAR 2002
JOSEPH ALAIMO (69), DIRECTOR SINCE 1997 Since September 1998, Mr. Alaimo has
been the President of WAMC. Immediately prior thereto, Mr. Alaimo served as
Director of Trust Investments at Lake Forest Bank since December 1994. Prior to
joining Lake Forest Bank, he was employed for more than 30 years by Continental
Bank, where he served most recently as Director of Investor Relations. Mr.
Alaimo held various senior positions in the trust department at Continental Bank
before he became their Director of Investor Relations. Mr. Alaimo also currently
serves as a trustee of Loomis Sayles Funds. Mr. Alaimo is a Director of WAMC.
PETER D. CRIST (48), DIRECTOR SINCE 1996 Since December 1999, Mr. Crist has
served as Vice Chairman of Korn/Ferry, International, the largest executive
search firm in the world. Previously he was President of Crist Partners, Ltd.,
an executive search firm he founded in 1995 and sold to Korn/Ferry,
International in 1999. Immediately prior thereto he was the Managing Director of
the Chicago office of Russell Reynolds Associates, Inc., the largest executive
- 4 -
<PAGE>
search firm in the Midwest, where he was employed for more than 18 years. Mr.
Crist also serves as a director of Northwestern Memorial Corporation. He is a
Director of Hinsdale Bank.
KATHLEEN R. HORNE (56), DIRECTOR SINCE 1997 Mrs. Horne is a former elementary
school teacher. For 14 years she was Vice President of the International
Creative Group - London/Chicago Ltd., a creative-marketing consultancy. From
1995 to 1997, she served as President of the Woman's Board of the Chicago
Horticultural Society and as a member of the Board of Directors of that
organization. Currently, Mrs. Horne is National Advisor to the Flower Arranging
Study Group of The Garden Club of America. Mrs. Horne is a Director of
Barrington Bank.
JOHN S. LILLARD (69), DIRECTOR SINCE 1996 Mr. Lillard has served as the
Company's Chairman since May 1998. He spent more than 15 years as an executive
with JMB Institutional Realty Corporation, a real estate investment firm, where
he served as President from 1979 to 1991 and as Chairman from 1992 to 1994. Mr.
Lillard was a general partner of Scudder Stevens & Clark until joining JMB in
1979. Mr. Lillard currently serves as a director of Cintas Corporation and
Stryker Corporation. Mr. Lillard is a Director of Lake Forest Bank and WAMC.
HOLLIS W. RADEMACHER (64), DIRECTOR SINCE 1996 Mr. Rademacher is self-employed
as a business consultant and private investor. He has participated in the
organization of five of the six Banks. From 1957 to 1993, Mr. Rademacher held
various positions, including Officer in Charge, U.S. Banking Department and
Chief Credit Officer, of Continental Bank, N.A., Chicago, Illinois, and from
1988 to 1993 held the position of Chief Financial Officer. Mr. Rademacher is a
director of Schawk, Inc. and College Television Network, as well as several
other private business enterprises. Mr. Rademacher currently serves as a
Director of each of the subsidiary Banks, FIFC, WAMC and Tricom.
JOHN N. SCHAPER (48), DIRECTOR SINCE 1996 Since 1991, Mr. Schaper has been a
general agent for American United Life Insurance Company. Mr. Schaper is a
Director of Libertyville Bank.
JOHN J. SCHORNACK (69), DIRECTOR SINCE 1996 Since 1999 Mr. Schornack has served
as Chairman of Strong Arm Products, LLC. Mr. Schornack is also the former
Chairman and CEO of KraftSeal Corporation, Lake Forest, Illinois, a position he
held from 1991 to 1997, and retired Chairman of Binks Sames Corporation,
Chicago, Illinois., where he served from 1996 to 1998. From 1955 to 1991, Mr.
Schornack was with Ernst & Young LLP, serving most recently as Vice Chairman and
Managing Partner of the Midwest Region. He is a Life Trustee of the Chicago
Symphony Orchestra, a trustee of the Kohl Children's Museum and The Night
Ministry. He also is the retired Chairman of the Board of Trustees of Barat
College, Lake Forest, Illinois. Mr. Schornack is a Director of North Shore Bank
and several other private business enterprises.
LARRY V. WRIGHT (60), DIRECTOR SINCE 1996 For the past 35 years, Mr. Wright has
been Vice President of Milbank Corporation, Chicago, Illinois, an investment
advisory firm. Mr. Wright also serves as a director of Milbank Corporation.
RETIRING DIRECTOR AND DIRECTOR EMERITUS
LEMUEL H. TATE, JR. (73), DIRECTOR SINCE 1996 For the past three years, Mr. Tate
has, from time to time served as a consultant to the Company and its
subsidiaries regarding real estate leasing and acquisition matters in connection
with expansion activities. From 1982 to 1988, Mr. Tate was an executive with
Northwestern Telecommunication Services (now known as Northwestern Technologies
Group) which is a venture partnership jointly owned by Northwestern University
and Northwestern Memorial Hospital Group. He retired as President and Chief
Operating Officer of the company in 1988. Since 1988, he has been active in
volunteer work in the local Chicago area. He is a member of the Evanston Rotary
Club and is active in the International Executive Service Corps. Since its
inception in 1994, Mr. Tate has been Chairman and a Director of North Shore
Bank. Effective at the Annual Meeting, Mr. Tate will become a Director Emeritus
for a one year term that is renewable at the Board's discretion and will be
available to consult with the Board.
- 5 -
<PAGE>
BOARD OF DIRECTORS' COMMITTEES AND COMPENSATION
BOARD OF DIRECTORS' COMMITTEES
Members of the Company's Board of Directors have been appointed to
serve on various committees of the Board of Directors. The Board of Directors
has established four committees: (i) the Compensation and Nominating Committee;
(ii) the Audit Committee; (iii) the Risk Management Committee; and (iv) the
Executive Committee.
Compensation and Nominating Committee. The Compensation and Nominating
Committee is composed entirely of outside directors who are not now, and have
never been, officers of the Company. Currently, the members of the Compensation
and Nominating Committee are Messrs. Crist (Chairman), Lillard, Mahoney,
Moschner, Neis, Rademacher and Reyes and Ms. McKenna. The Compensation and
Nominating Committee is responsible for reviewing the Company's compensation
policies and administering the Company's employee benefit and stock incentive
programs, and reports to the Board regarding executive compensation
recommendations. This Committee also functions as a nominating committee to
propose to the full Board a slate of nominees for election as directors. During
1999, five Compensation Committee meetings were held.
Audit Committee. The Audit Committee is composed entirely of outside
directors who are not now, and have never been, officers of the Company.
Currently, the members of the Audit Committee are Messrs. Schornack (Chairman),
Crowther, Dunne, and Graft and Ms. Stein and Ms. Sylvester. The Audit Committee
is responsible for oversight of the Company's accounting, reporting and
financial controls practices, reports to the Board regarding audit activities
and examinations, and annually reviews the qualifications of independent
auditors. During 1999, six Audit Committee meetings were held.
Risk Management Committee. The Risk Management Committee currently
consists of Messrs. Rademacher (Chairman), Moschner, Rusin, Schaper, and Tate
and Ms. Horne. The Risk Management Committee is responsible for monitoring and
overseeing the Company's insurance program, interest rate risk and credit risk
exposure on a consolidated basis and at the subsidiaries. This Committee is also
responsible for development and implementation of the Company's overall
asset/liability management and credit policies. During 1999, four Risk
Management Committee meetings were held.
Executive Committee. The Executive Committee currently consists of
Messrs. Rademacher (Chairman), Crist, Lillard, Reyes, Schornack, and Wehmer, and
Ms. Stafford. The Executive Committee is authorized to exercise certain powers
of the Board, and meets as needed, usually in situations where it is not
feasible to take action by the full Board. No Executive Committee meetings were
held during 1999.
BOARD OF DIRECTORS' COMPENSATION
Non-employee members of the Board of Directors are compensated by the
Company at the rate of $500 for each Board of Directors meeting attended and
$200 for each committee meeting attended. There were five meetings of the Board
of Directors during 1999. In addition to regular board and committee meeting
fees, the Company pays retainers to the Chairman of the Board, the chairman of
the Risk Management Committee, the chairman of the Compensation and Nominating
Committee and the chairman of the Audit Committee. During 1999, such retainers
were $40,000, $20,000, $2,000 and $2,000, respectively, and are set to be
$50,000, $30,000, $3,000 and $3,000, resprectively, in 2000. Employee members of
the Board of Directors receive no Board of Director compensation. All
non-employee directors who serve on the subsidiary boards of directors are also
entitled to compensation for such service. For the period during 1999 in which
they served, all of the directors attended at least 75% of the total number of
meetings held of the Board and those Committees on which they served, except for
Directors Crowther, Horne, McCarthy, Moschner, Rusin, and Wright.
- 6 -
<PAGE>
DEFERRED COMPENSATION FOR NON-EMPLOYEE DIRECTORS
The Wintrust Financial Corporation Deferred Director Fee Plan allows
non-employee Directors to elect to defer receipt of director fees and retainers
due such Directors. The deferred director fees and retainers are payable at the
Director's option as a lump sum or in installments over a period not to exceed
ten years. Cumulative deferred amounts bear interest at the 91-day Treasury Bill
discount rate, adjusted monthly, until paid. Payments under the plan, which are
unfunded obligations of the Company, begin at the date specified by the Director
or upon cessation of service as a Director.
EXECUTIVE OFFICERS OF THE COMPANY
The Company's Executive Officers are elected annually by the Company's
Board of Directors at the first meeting of the Board following the Annual
Meeting of Shareholders. Certain information regarding those persons serving as
the Company's Executive Officers is set forth below.
Edward J. Wehmer (46) -- President and Chief Executive Officer - Mr. Wehmer
serves as the Company's President and performs the functions of the Chief
Executive Officer. Accordingly, he is responsible for overseeing the execution
of the Company's day-to-day operations and strategic initiatives. See the
description above under "Election of Directors" for additional biographical
information.
David A. Dykstra (39) -- Executive Vice President, Chief Financial Officer,
Secretary and Treasurer - Mr. Dykstra serves as the Company's Chief Financial
Officer and oversees all financial affairs of the Company, including internal
and external financial reporting. Prior thereto, Mr. Dykstra was employed from
1990 to 1995 by River Forest Bancorp, Inc., Chicago, Illinois, most recently
holding the position of Senior Vice President and Chief Financial Officer. Prior
to his association with River Forest Bancorp, Mr. Dykstra spent seven years with
KPMG LLP, most recently holding the position of Audit Manager in the banking
practice. Mr. Dykstra is a Director of Libertyville Bank, FIFC and Tricom.
Lloyd M. Bowden (46) -- Executive Vice President -- Technology - Mr. Bowden
serves as Executive Vice President - Technology for the Company and is
responsible for planning, implementing and maintaining all aspects of the
subsidiary banks' internal data processing systems and technology designed to
service the subsidiary banks' customer base. Mr. Bowden joined the Company in
April 1996 to serve as the Director of Technology with responsibility for
implementing technological improvements to enhance customer service capabilities
and operational efficiencies. Prior thereto, he was employed by Electronic Data
Systems, Inc. in various capacities since 1982, most recently in an executive
management position with the Banking Services Division and previously in the
Banking Group of the Management Consulting Division.
Robert F. Key (45) -- Executive Vice President -- Marketing - Mr. Key serves as
the Executive Vice President - Marketing for the Company and directs all
advertising and marketing programs for each of the subsidiary banks and WAMC.
Mr. Key joined the Company in March 1996 to serve as Executive Vice President of
Marketing. From 1978 through March 1996, Mr. Key was a Vice President/Account
Director at Leo Burnett Company.
Todd A. Gustafson (36) -- Vice President -- Finance - Mr. Gustafson served as
the Vice President of Finance from June 1998 until April 2000 when he relocated
his employment to Rockford, Illinois. He was responsible for the management of
all accounting, audit, financial and tax activities of the Company and its
subsidiaries. Previously, Mr. Gustafson was employed from 1990 to 1996 as Vice
President and Corporate Controller for Amcore Financial, Inc., Rockford,
Illinois and from 1997 to 1998 as Manager of Financial Reporting and Analysis
for Woodward Governor Company, Rockford, Illinois. Mr. Gustafson is a certified
public accountant and previously specialized in the financial institutions
industry as a Senior Audit Manager for BDO Seidman, LLP and as an Audit Manager
for KPMG LLP.
David J. Galvan (39) -- Vice President -- Investments - Mr. Galvan has served as
the Vice President of Investments since June 1999. He directs all securities
investment activity, wholesale funding and interest rate risk management for the
Company. Previously, Mr. Galvan was employed for 16 years at Amcore Financial,
Inc., Rockford, Illinois, where he served as Vice President and Funds Manager.
- 7 -
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS, DIRECTORS AND MANAGEMENT
The following table sets forth the beneficial ownership of the Common
Stock as of the Annual Meeting Record Date, with respect to (i) each Director
and each Named Executive Officer of the Company; (ii) all Directors and
executive officers of the Company as a group; and (iii) any shareholder known to
hold in excess of 5% of any class of the Company's voting securities.
<TABLE>
<CAPTION>
AMOUNT OF CURRENTLY TOTAL
COMMON SHARES EXERCISABLE AMOUNT OF TOTAL
BENEFICIALLY OPTIONS & BENEFICIAL PERCENTAGE
OWNED(1) WARRANTS (1) OWNERSHIP(1) OWNERSHIP
---------------- --------------- -------------- -------------
<S> <C> <C> <C> <C>
DIRECTORS
---------
Joseph Alaimo.......................... 7,395 22,873 30,268 *
Peter D. Crist......................... 28,884 2,672 31,556 *
Bruce Crowther......................... 645 255 900 *
Maurice F. Dunne, Jr................... 44,902 9,415 54,317 *
William C. Graft....................... 10,000 340 10,340 *
Kathleen R. Horne...................... 500 306 806 *
John W. Leopold........................ 188,442 -- 188,442 2.15%
John S. Lillard........................ 109,760 4,507 114,267 1.30%
James E. Mahoney....................... 10,720 1,208 11,928 *
James B. McCarthy...................... 13,840 2,551 16,391 *
Marguerite Savard McKenna.............. 15,074 4,156 19,230 *
Albin F. Moschner...................... 8,869 -- 8,869 *
Thomas J. Neis......................... 100 -- 100 *
Hollis W. Rademacher................... 51,007 10,136 61,143 *
J. Christopher Reyes................... 163,940 4,005 167,945 1.92%
Peter P. Rusin......................... 1,000 187 1,187 *
John N. Schaper........................ 1,207 1,208 2,415 *
John J. Schornack...................... 9,500 3,804 13,304 *
Ingrid Stafford........................ 2,992 3,887 6,879 *
Jane R. Stein.......................... -- 1,208 1,208 *
Katharine V. Sylvester................. 3,120 2,793 5,913 *
Lemuel H. Tate......................... 15,879 10,070 25,949 *
Edward J. Wehmer**..................... 147,000 173,076 320,076 3.59%
Larry V. Wright(2)..................... 389,865 28,492 418,357 4.76%
OTHER NAMED EXECUTIVE OFFICERS
------------------------------
Lloyd M. Bowden........................ 15,641 23,819 39,460 *
David A. Dykstra....................... 18,574 52,706 71,280 *
Todd A. Gustafson ..................... -- 1,500 1,500 *
Robert F. Key.......................... 22,652 36,186 58,838 *
TOTAL DIRECTORS & EXECUTIVE
---------------------------
OFFICERS (29 PERSONS) ............. 1,282,108 401,360 1,683,468 18.39%
---------------------
DIRECTOR NOMINEE NOT CURRENTLY SERVING
--------------------------------------
Dorothy M. Mueller..................... 150 -- 150 *
OTHER SIGNIFICANT SHAREHOLDERS
------------------------------
Howard D. Adams(3) .................... 463,340 8,735 472,075 5.39%
Emmett McCarthy(4)..................... 367,952 93,302 461,254 5.21%
<FN>
* Less than 1%
** Denotes person serving as Director and as an executive officer.
- 8 -
<PAGE>
(1) Beneficial ownership and percentages are calculated in accordance with SEC
Rule 13d-3 promulgated under the Securities Exchange Act of 1934.
Information for Other Significant Shareholders is based on their most
recent Schedule 13G filings with the SEC.
(2) Includes (i) 21,433 shares and 4,667 shares subject to Warrants held
directly by Larry Wright; (ii) 3,000 shares held by Milbank Corporation
("Milbank") of which Mr. Wright is an officer, director and sole
shareholder and with respect to which shares he exercises shared voting and
investment power; (iii) 8,721 shares and 1,092 shares subject to Warrants
held by an employee retirement plan of Milbank of which Mr. Wright is a
trustee with shared voting and investment power; (iv) 351,884 shares and
22,733 shares subject to Warrants held in Deerpath Investments LLP, a
limited partnership ("Deerpath"), to which Milbank serves as investment
advisor and with respect to which Mr. Wright exercises shared voting and
investment power; and (v) 4,827 shares held in certain family trusts of
another officer of Milbank with respect to which Mr. Wright acts as
co-trustee and exercises shared voting power. The address of Mr. Wright is
135 South LaSalle Street, Chicago, Illinois 60603.
(3) Includes 30,137 shares held in certain family trusts for the benefit of
Howard D. Adams' son and 3,957 shares held in a charitable foundation with
respect to which shares Mr. Adams disclaims beneficial ownership. Also
includes 29,463 shares held by Mr. Adams' wife. Does not include additional
shares held directly by, or indirectly through certain other family trusts
(for which neither Mr. Adams nor his wife acts as co-trustee) for the
benefit of Mr. Adams' two adult children. The address of Mr. Adams is 570
Crabtree Lane, Lake Forest, Illinois 60045.
(4) Includes 16,367 shares owned by Emmett D. McCarthy and his family. Also
reflects 169,930 shares, 28,962 shares subject to Warrants, and 17,689
shares subject to options held by the Alan W. Adams Family Trust and
152,781 shares, 28,962 shares subject to Warrants, and 17,689 shares
subject to options held by the Sarah K. Adams Family Trust, irrevocable
trusts for which Emmett D. McCarthy and either Alan W. Adams or Sarah K.
Adams, respectively, serve as co-trustees. The beneficiaries of the
respective trusts are Alan W. Adams and Sarah K. Adams, respectively, the
two adult children of Howard D. Adams. Mr. McCarthy disclaims beneficial
ownership of all such shares. Also reflects 28,874 shares held by the Sarah
Katherine Adams Trust, an irrevocable trust for which Emmett D. McCarthy
serves as trustee, the beneficiary of which trust is Sarah K. Adams. The
address of Mr. McCarthy, as Trustee, is c/o 570 Crabtree Lane, Lake Forest,
Illinois 60045.
</FN>
</TABLE>
- 9 -
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table summarizes the compensation paid by the Company and
its subsidiaries to those persons serving as Chief Executive Officer and the
four other most highly compensated executive officers (the "Named Executive
Officers") during 1999, 1998 and 1997. In determining the level of bonuses in
1999, the Company's Compensation Committee evaluated the bonus amount in
conjunction with stock incentive awards. See further discussion of the Company's
overall compensation philosophy in the "Compensation Committee Report on
Executive Compensation" contained later in this Proxy Statement.
<TABLE>
<CAPTION>
Summary Compensation Table
-------------------------------------------------------------------------------------
Long-Term
Compensation
Annual Compensation Awards
-----------------------------------------------------
Other Annual Securities All Other
Compen- Underlying Compen-
Name and Salary Bonus sation(1) Options/ sation(2)
Principal Position Year ($) ($) ($) SARs (#) ($)
------------------ ---- ---- ---- ---- --------- ----
<S> <C> <C> <C> <C> <C> <C>
Edward J. Wehmer 1999 450,000 11,000 9,446 14,667 900
President & Chief 1998 450,000 45,000 9,895 -- 1,200
Executive Officer 1997 425,000 40,000 12,420 20,000(3) 881
David A. Dykstra 1999 225,000 8,000 6,911 10,667 --
Executive Vice President & 1998 206,000 30,000 6,517 -- --
Chief Financial Officer 1997 176,000 35,000 6,862 18,000 980
Robert F. Key 1999 190,000 4,500 6,003 5,600 720
Executive Vice President & 1998 180,000 18,000 6,482 -- 469
Director of Marketing 1997 165,000 25,000 6,233 10,000 434
Lloyd M. Bowden 1999 150,500 4,000 2,222 5,333 450
Executive Vice President & 1998 140,500 18,000 2,523 -- 332
Director of Technology 1997 128,000 15,000 2,533 8,000 296
Todd A. Gustafson 1999 123,000 14,000 -- 5,000 --
Vice President - Finance 1998(4) 60,596 15,000 -- 7,500 --
- --------------------------------------------
<FN>
(1) Other annual compensation represents the value of certain perquisites,
including the use of a Company car and/or the payment of club dues.
(2) Represents the aggregate life insurance premium paid on behalf of the
named executive officer by the Company and/or other miscellaneous
benefits.
(3) Represents grants of options approved in January 1998 with respect to
executive's service in 1997.
(4) Reflects compensation for partial year service during executive's
initial year of employment with the Company. The 1998 base salary for
Mr. Gustafson was $115,000. The 1998 bonus amount includes a signing
bonus of $5,000.
</FN>
</TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The table on the following page summarizes for each Named Executive
Officer certain information about options which were granted by the Company
under the 1997 Stock Incentive Plan with respect to the executives' service in
1999. All options were granted at per share exercise prices equal to the fair
market value per share on the date of grant.
- 10 -
<PAGE>
<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
% OF TOTAL POTENTIAL REALIZABLE
NUMBER OF OPTIONS/ VALUE AT ASSUMED
SHARES SARS ANNUAL RATES OF
UNDERLYING GRANTED TO EXERCISE STOCK PRICE
OPTIONS/ EMPLOYEES OR BASE APPRECIATION
SARS IN FISCAL PRICE EXPIRATION FOR OPTION/SAR TERM
---------------------
NAME GRANTED YEAR ($/SH) DATE 5% 10%
---- -------- ----- ------- ----- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Edward J. Wehmer (1)....... 14,667 5.62% $ 17.00 10/28/09 $156,808 $397,382
David A. Dykstra (1)....... 10,667 4.08% 17.00 10/28/09 114,043 289,008
Robert F. Key (1).......... 5,600 2.14% 17.00 10/28/09 59,871 151,724
Lloyd M. Bowden (1)........ 5,333 2.04% 17.00 10/28/09 57,016 144,490
Todd A. Gustafson (2)...... 5,000 1.91% 18.44 4/29/09 57,976 146,923
- -------------------------------------------------
<FN>
(1) Pursuant to the terms of the option awards, all such Options vested
100% as of December 31, 1999.
(2) Options were to vest in 20% annual increments beginning on April 29,
2000. Such options were forfeited upon Mr. Gustafson's departure from
the Company in April, 2000.
</FN>
</TABLE>
AGGREGATED OPTION/SAR EXERCISES AND YEAR-END VALUES
The following table summarizes for each Named Executive Officer the number
of shares of Common Stock subject to outstanding Options/SARs and the value of
such Options/SARs that were unexercised at December 31, 1999.
<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION/SAR VALUES
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
SHARES UNEXERCISED IN-THE-MONEY
ACQUIRED ON VALUE OPTIONS/SARS AT OPTIONS/SARS AT
NAME EXERCISE (#) REALIZED ($) DECEMBER 31, 1999 (#) DECEMBER 31, 1999 ($)
---- ------------ ------------ --------------------- ---------------------
EXERCISABLE/ EXERCISABLE/
UNEXERCISABLE(1) UNEXERCISABLE(1)
--------------------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
Edward J. Wehmer.......... -- -- 149,938 / 16,000 $1,121,851 / $ 0
David A. Dykstra.......... -- -- 47,666 / 18,705 134,048 / 11,643
Robert F. Key............. -- -- 34,186 / 10,514 64,719 / 3,848
Lloyd M. Bowden........... -- -- 22,219 / 9,784 35,289 / 9,440
Todd A. Gustafson......... -- -- 1,500 / 11,000 0 / 0
- ----------------------------------------
<FN>
(1) The numbers and amounts represent shares of Common Stock subject to
outstanding Options/SARs granted by the Company or its predecessors that
were unexercised as of December 31, 1999.
</FN>
</TABLE>
- 11 -
<PAGE>
EMPLOYMENT AGREEMENTS
In 1998, the Company entered into a new employment agreements with
Edward J. Wehmer, David A. Dykstra, Robert F. Key, and Lloyd M. Bowden, as well
as certain other officers of the Company and its subsidiaries. The employment
agreements contain confidentiality agreements and two-year non-compete
provisions in the event of termination of employment for any reason, and provide
for up to 24 months of severance pay at an annual rate equal to the executive's
current base salary and prior year bonus amount in the event of (i) termination
without cause, (ii) a material reduction in duties and responsibilities, (iii)
permanent disability (as defined in the agreement), or (iv) reduction in base
annual compensation to less than 75% of the executive's "Adjusted Total
Compensation", as defined in the agreement to be the aggregate of current base
salary plus the dollar value of all perquisites for the preceding twelve month
period. "Adjusted Total Compensation" excludes any bonus payments paid or earned
by the executives. The severance amounts payable under the agreement are subject
to reduction for any income earned from other employment during the two-year
period or, in the case of disability, any long-term disability insurance
benefits from policies maintained or paid for by the Company. In addition, in
the event of the executive's death resulting in termination of employment, the
executive's beneficiaries are entitled to a lump sum payment equal to the
aggregate severance pay amount, reduced by any life insurance benefits under
policies paid for by the Company. The "Adjusted Total Compensation" as of the
respective dates of such agreements for Messrs. Wehmer, Dykstra, Key, and Bowden
were $469,000, $214,000, $190,000 and $149,000, respectively. In addition to any
increases in base salaries that may be agreed to from time to time, the
executives are entitled to participate in any employee insurance and fringe
benefit programs that may be established by the Company for its employees. The
current annual base salaries of Messrs. Wehmer, Dykstra, Key and Bowden are
$470,000, $250,000, $200,000 and $160,000, respectively.
The employment agreements also provide for a lump sum payment in the
event the executive's employment is terminated without cause (or constructively
terminated due to a material reduction in duties and responsibilities or a
reduction in Adjusted Total Compensation as described above) within 12 months
following a change in control (as defined in the agreement) of the Company. Such
change in control payment shall be equal to two times the sum of the executive's
base annual salary plus prior year's bonus, subject to reduction in certain
circumstances if the amount payable under the agreement together with any other
amounts payable by the Company to the executive is deemed to result in "excess
parachute payments" under Section 280G of the Internal Revenue Code. The
agreement does not require the amount to be scaled back to satisfy the Section
280G limit, however, if the contractual change in control payment minus the
excise taxes that would be payable by the executive would be greater than the
reduced amount.
Pursuant to an amendment made to Mr. Wehmer's employment agreement in
January 2000, he is also entitled to certain special bonus payments to pay
interest on a loan made to him by the Company. See "Certain Transactions."
COMPENSATION AND NOMINATING COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Committee that determines executive compensation consists entirely
of non-employee Directors, although Edward J. Wehmer, President and Chief
Executive Officer of the Company, makes recommendations to the Committee
regarding compensation of officers other than himself. Mr. Wehmer serves on the
compensation committees of each of the Company's subsidiaries, including WAMC,
North Shore Bank and Tricom which are responsible for determining the
compensation of the senior officers of those subsidiaries. Joseph Alaimo, Lemuel
Tate, and John Leopold, senior officers of WAMC, North Shore Bank, and Tricom,
respectively, are Directors of the Company.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
OVERALL COMPENSATION PHILOSOPHY: The Compensation and Nominating
Committee of the Board of Directors (the "Committee") has the responsibility to
monitor and implement the overall executive compensation program of the Company.
The objectives of the Company's compensation policies are to enhance shareholder
value; to create and sustain high performance; to attract and retain as
executives individuals who can contribute substantially to the Company's short
and long term goals; and to align the interests of executives with those of the
- 12 -
<PAGE>
shareholders of the Company. The philosophy is to provide competitive base
salaries which reflect individual levels of responsibility and performance,
annual bonuses based upon personal achievement and contributions to annual
corporate performance, and stock-based incentive awards. The combined result is
a strengthening of the mutuality of interest in the Company's long-term
performance between its executive officers and the Company's shareholders.
BASE SALARIES: Base salaries for executive officers were determined at
the time of hire by comparing responsibilities of the position with those of
other similar executive officer positions in the marketplace and the
individual's experience. Annual salary adjustments have been determined giving
consideration to the Company's performance and the individual's contribution to
that performance. While there are no specific performance weightings
established, the salary recommendations are based on performance criteria such
as:
o financial performance of the Company with a balance between
long and short term growth in earnings, revenue and asset
growth;
o role in development and implementation of long term strategic
plans;
o responsiveness to changes in the financial institution
marketplace; and
o growth and diversification of the Company.
In the absence of similar de novo bank holding companies, it is
difficult to identify appropriate peer group comparisons for the base salaries
of the Company's executives. In addition, the Company's strategy is to pay
executives very competitive salaries in an effort to attract and retain highly
qualified, well-experienced individuals which, given the relatively young
history of the Company, currently may be higher than those paid by comparably
sized financial institutions. However, as the Company matures, the Committee
believes that increases to total cash compensation should increasingly be more
heavily weighted toward the bonus and stock incentive components than the base
salary component. This philosophy is intended to ensure a pay for performance
compensation framework which is aligned with shareholder value.
BONUSES: Executives may earn annual cash bonuses based upon a
pay-for-performance philosophy which are determined at year-end. In recommending
bonuses, the Committee considers the achievements of each executive officer for
that year, as well as the Company's performance. The achievements may be
quantitative or qualitative. Qualitative factors include but are not limited to
commitment, dedication, demonstration of the entrepreneurial spirit, creativity
and initiative, and attention to personnel relations. The Committee also
evaluates the bonus amount in conjunction with stock incentive awards, if any.
Given the size of the Company and its relatively early growth stage,
the Committee believes it is feasible to evaluate the different individual
contributions of each of the Company's executive officers, and, as a matter of
policy, there has not been a defined bonus plan established. However, the
Committee did evaluate the attainment of certain specific Company and individual
objectives in determining the bonus amounts awarded to executives. The primary
objectives were based upon net income, deposit growth, loan growth, certain
financial performance measures such as net interest margin and net overhead
ratios, and tailored personal objectives for each executive. The Committee used
these measurable objectives as a guideline to establish executive bonuses, but
the end determination of such bonuses was ultimately a discretionary decision.
Accordingly, the policy used by the Board to set cash bonuses is considered
subjective. The bonuses for each of the executive officers other than the
President and CEO were set at the levels recommended by management.
STOCK OPTIONS: To ensure a direct connection between the executive
officer interests and the shareholders of the Company, the Company has awarded
and intends to award stock-based incentives which are longer term in nature than
the base salary and annual bonus components of overall compensation. The
incentives have been primarily in the form of stock options granted at exercise
prices at or above fair market value on the date of grant. The intention is to
incentivize employees to create shareholder value over the long term since the
full benefit of the compensation package cannot be realized unless an
appreciation in the share price occurs over a specified number of years. The
Company did not award equity incentives for 1998. In 1999, the Company granted
non-qualified stock
- 13 -
<PAGE>
options to senior management as part of their overall compensation package and
in lieu of larger cash bonuses. The equity incentives were determined in the
fourth quarter of 1999. Such stock options were granted at exercise prices equal
to fair market value on the date of grant, were fully exercisable as of December
31, 1999 and have a term of ten years.
CHIEF EXECUTIVE OFFICER COMPENSATION: Mr. Edward J. Wehmer was
appointed Chief Executive Officer, in addition to his role as President, in May
1998. Mr. Wehmer's base salary for 1999 was established by the Committee at the
beginning of the year and the salary level of $450,000 was held constant with
the base salary level of 1998. The Committee determined that the base salary
level was appropriate and that Mr. Wehmer's compensation level should be
influenced more heavily by incentive-based compensation than by base salary
increases.
The 1999 bonus amount and stock options awarded to Mr. Wehmer were
based on the recognition by the members of the Committee of his dedication to
the success of the Company as exhibited through long-term vision,
entrepreneurial spirit, hard work ethic, knowledge of the financial services
industry, strong operational and financial control knowledge and his ability to
recruit a management team with similar characteristics. In addition, the
Committee considered the following corporate achievements:
(1) The continued growth of the Company as one of the largest de
novo banking operations in the Midwest area.
(2) The increase in the profitability of the Company to $9.4
million in 1999 from $6.2 million in 1998, and the exceptional
201% (or $9.4 million) increase in pre-tax earnings to $14.2
million in 1999 from $4.7 million in 1998. The Committee
considers the increase in pre-tax profits to be a better
barometer of growth in core earnings.
(3) The growth of the Company's assets, deposits and loans during
1999 of $331 million, $234 million and $286 million,
respectively. The increases show growth in these categories in
the range of 19% to 29%.
(4) The successful acquisition of Tricom, Inc. of Milwaukee, a
financial services firm to the temporary staffing industry.
(5) The successful completion of a private placement of additional
common stock during the year that provided for continued
growth of the Company while maintaining an efficient capital
structure.
(6) The successful opening of three additional banking facilities
during the year that expanded the geographical reach of the
organization and enlarged the platform utilized by the Company
to effectuate continued growth.
(7) The reduction in the ratio of noninterest expenses as a
percent of average assets to 2.65% in 1999 from 3.04% in 1998
despite the opening of the three additional banking facilities
in 1999.
(8) The improvement in the Company's net interest margin to 3.54%
in 1999 from 3.43% in 1998 and his commitment to improving the
margin through the strategy of having the Company be "asset
driven" through a diverse set of earning asset portfolios.
(9) The continuing stability in the manageable level of
non-performing assets.
SECTION 162(M): The Compensation and Nominating Committee does not
believe that the provisions of Section 162(m) of the Internal Revenue Code of
1986, as amended (the "Code"), relating to the deductibility of compensation
paid to the Named Executive Officers, will limit the deductibility of the
executive compensation currently expected to be paid by the Company. The
Compensation and Nominating Committee will continue to
- 14 -
<PAGE>
evaluate the impact of such provisions and to consider compensation policies and
programs appropriate for an organization of the Company's size and history in an
effort to address the potential impact, if any, in the future.
CONCLUSION: The Compensation Committee believes the executive officers'
individual compensation packages are designed in a manner which is consistent
with the Company's overall compensation philosophy.
PETER D. CRIST (Chairman of the Committee) ALBIN F. MOSCHNER
JOHN S. LILLARD THOMAS J. NEIS
JAMES E. MAHONEY J. CHRISTOPHER REYES
MARGUERITE SAVARD MCKENNA HOLLIS W. RADEMACHER
PERFORMANCE GRAPH
The following performance graph compares the percentage change in the
Company's cumulative shareholder return on common stock compared with the
cumulative total return on composites of (1) all Nasdaq National Market stocks
for United States companies (broad market index) and (2) all Nasdaq National
Market bank stocks (peer group index). Cumulative total return is computed by
dividing the sum of the cumulative amount of dividends for the measurement
period and the difference between the Company's share price at the end and the
beginning of the measurement period by the share price at the beginning of the
measurement period. The Nasdaq National Market for United States companies index
comprises all domestic common shares traded on the Nasdaq National Market and
the Nasdaq Small-Cap Market. The Nasdaq National Market bank stocks index
comprises all banks traded on the Nasdaq National Market and the Nasdaq
Small-Cap Market.
The Total Return Performance Graph omitted represented a graph of date points as
follows:
<TABLE>
<CAPTION>
1/24/97 6/30/97 12/31/97 6/30/1998 12/31/1998 6/30/1999 12/31/1999
<S> <C> <C> <C> <C> <C> <C> <C>
Wintrust Financial Corporation 100 110.66 111.48 129.51 128.69 115.57 100.00
Nasdaq - Total US 100 104.49 114.41 137.58 161.22 197.32 291.27
Nasdaq - Bank Index 100 118.50 158.61 164.23 157.51 162.27 151.40
</TABLE>
The Company became subject to reporting its cumulative shareholder
returns as of January 24, 1997 when the Company became a registrant under the
Securities Exchange Act of 1934. Accordingly, the graph presents the cumulative
shareholder returns from January 24, 1997 through December 31, 1999.
- 15 -
<PAGE>
TRANSACTIONS WITH MANAGEMENT AND OTHERS
Some of the executive officers and Directors of the Company are, and
have been during the preceding year, customers of the Bank, and some of
the officers and Directors of the Company are direct or indirect owners of 10%
or more of the stock of corporations which are, or have been in the past,
customers of the Bank. As such customers, they have had transactions in the
ordinary course of business of the Bank, including borrowings, all of which
transactions are or were on substantially the same terms (including interest
rates and collateral on loans) as those prevailing at the time for comparable
transactions with nonaffiliated persons. In the opinion of management of the
Company, none of the transactions involved more than the normal risk of
collectibility or presented any other unfavorable features. At December 31,
1999, the Bank had $22.1 million in loans outstanding to certain Directors and
executive officers of the Company and certain executive officers of the Banks,
which amount represented 23.8% of total shareholders' equity as of that date.
Mr. Lemuel Tate, a director of the Company whose term expires at the
meeting, provides consulting services to the Company related to real estate
leasing and property acquisitions for new banking locations. Mr. Tate also
oversees certain construction projects at various bank premises. During 1999,
Mr. Tate received an aggregate of $67,179 in fees from the Company and its
subsidiaries for such services. Mr. Tate also serves as the Chairman of North
Shore Bank and received an annual retainer of $56,000 in lieu of bank director
fees for his service in this role in 1999 and is expected to receive $56,000 in
2000 for continued service in this capacity. Mr. Tate is eligible for
discretionary bonuses in addition to the amounts noted above.
In October 1999, the Company acquired 100% of Tricom, Inc. of
Milwaukee. Mr. Leopold was the majority shareholder of Tricom prior to the
acquisition by the Company. Subsequent to the acquisition, in January 2000, Mr.
Leopold became a director of the Company. Mr. Leopold received 188,442 shares of
the Company's common stock and cash of approximately $2.8 million from the
Company as consideration for his ownership interest in Tricom. Mr. Leopold also
entered into an employment agreement with the Company for an initial term of one
year. The employment agreement is renewable at the mutual consent of Mr. Leopold
and the Company.
During the organization of the Company's predecessor companies, Edward
J. Wehmer, President and Chief Executive Officer, purchased various shares of
Company stock using borrowed funds. Mr. Wehmer maintained the loan for such
purchases at an unaffiliated bank. In January 2000, the Company entered into a
term note agreement with Mr. Wehmer and his spouse and loaned them $1,200,000 in
order for Mr. Wehmer to retire the debt at the unaffiliated bank. The note has a
maturity date of January 31, 2005 and bears interest at an annual rate of 7%,
compounded annually. Interest is payable annually. The note is full recourse to
the borrowers and is also is secured by a pledge of 100,000 shares of the
Company's common stock. If Mr. Wehmer's employment with the Company terminates
for any reason, the Company has the right to immediately accelerate the maturity
of the Note if the principal and accrued interest on the Note is not paid in
full within 90 days of the date of termination. The Company also agreed to amend
Mr. Wehmer's employment agreement to provide for a special annual bonus to be
paid to Mr. Wehmer in the amount equal to the accrued interest on the note,
payable one business day prior to each anniversary of the date of the Note. If
Mr. Wehmer is terminated without cause, or if he resigns for any reason within
18 months following a change of control, he is entitled to receive a special
severance payment equal to accumulated interest through his termination date.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's Directors and executive officers to file reports of holdings and
transactions in the Company's Common Stock with the the Securities and Exchange
Commission. Based upon its review of copies of such reports and of trading in
the Company's common stock, the Company is not aware of any late filings during
1999 with the following exception: Director Neis should have filed a Form 3 in
February, 1999 to report his holdings at the time he became a director of the
Company in January, 1999; however, the appropriate form was not filed until
December, 1999 due to an oversight on the part of the Company to properly inform
the new director of the reporting requirements.
- 16 -
<PAGE>
PROPOSAL NO. 2
SHAREHOLDER APPROVAL OF AMENDMENT TO
1997 STOCK INCENTIVE PLAN
Introduction. At the Annual Meeting, there will be submitted a proposal
to approve an amendment to the Wintrust Financial Corporation 1997 Incentive
Plan (the "Stock Incentive Plan" or the "Plan"). The Board of Directors adopted
the amendment on January 27, 2000, subject to shareholder approval, to increase
the number of shares of Common Stock authorized to be issued under the Stock
Incentive Plan by 450,000 shares.
The Stock Incentive Plan was originally adopted in 1997 to amend,
restate and continue the prior stock-based incentive plans of the Company's
predecessor corporations into a single plan and was approved by shareholders at
the 1997 Annual Meeting of Shareholders.
Approval of the amendment to the Plan requires the affirmative vote of
a majority of the shares represented in person or by proxy and entitled to vote
at the 2000 Annual Meeting of Shareholders.
The following description of the Plan sets forth the material terms of
the Plan, as amended; however, it is a summary, and does not purport to be
complete and is qualified in its entirety by reference to the provisions of the
Plan. A copy of the Plan can be obtained upon written request from David A.
Dykstra, Executive Vice President and Chief Financial Officer, Wintrust
Financial Corporation, 727 North Bank Lane, Lake Forest, Illinois 60045.
Purpose. The Stock Incentive Plan is intended to provide the Company
with the ability to provide market-responsive, stock-based incentives and other
rewards for employees and directors of the Company and its subsidiaries and
consultants to the Company and its subsidiaries (i) to provide such employees,
directors and consultants a stake in the growth of the Company, and (ii) to
encourage them to continue in the service of the Company and its subsidiaries.
Because there are only 63,621 shares remaining to be awarded under the Stock
Incentive Plan, the Board of Directors believes that it is appropriate to
increase the shares reserved for issuance under the Plan by 450,000 shares.
Additionally, some of the Company's existing options will be exercised or expire
during the next two years, reducing the total option shares outstanding.
These shares will enable the Company to be competitive in attracting
key employees to manage planned additional bank and branch location. For
example, management estimates that it typically requires approximately 70,000
option shares to attract management to staff a new de novo banking operation.
The additional shares will also be important to promote the retention of key
employees while at the same time aligning their interests closely with those of
the shareholders. Accordingly, additional option shares are an important
component in continuing the Company's growth.
Participants. All of the approximately 412 employees and all of the
non-employee directors of the Company and its subsidiaries, currently
approximately 86, will be eligible to participate in the Plan. In addition,
certain persons who have consulting arrangements with the Company or its
subsidiaries may be selected to participate if it is determined that any such
individual has a significant responsibility for the success and future growth
and profitability of the Company.
Authorization. The Stock Incentive Plan currently provides that the
total number of shares of Common Stock as to which awards may be granted may not
exceed 1,937,359 shares. Approval by shareholders of the proposed amendment to
the Stock Incentive Plan will increase this maximum to 2,387,359 shares. Of this
amount, the number of shares that would be available for new awards would be
513,621 shares. A total of 229,024 shares have already been issued pursuant to
the exercise of prior awards under the Plan.
The shares of Common Stock subject to awards under the Stock Incentive
Plan and available for future awards will be reserved for issuance out of the
Company's total authorized shares. A participant in the Plan is
- 17 -
<PAGE>
permitted to receive multiple grants of stock-based awards. The terms and
provisions of a type of award with respect to any recipient need not be the same
with respect to any other recipient of such award. The Plan provides that during
any calendar year the maximum number of shares of Common Stock which may be made
subject to award to any single participant may not exceed 100,000.
Administration. The Board of Directors of the Company has delegated the
administration of the Stock Incentive Plan to its Compensation Committee (the
"Committee"). The Committee will make determinations with respect to the
participation of employees, directors and consultants in the Plan and, except as
otherwise required by law or the Plan, the grant terms of awards including
vesting schedules, price, length of relevant performance, restriction or option
period, dividend rights, rights to dividend equivalents, post-retirement and
termination rights, payment alternatives, and such other terms and conditions as
the Committee deems appropriate. The Committee may designate other persons to
carry out its responsibilities under such conditions and limitations as it may
set, other than its authority with regard to awards granted to employees who are
executive officers or directors of the Company.
The disposition of an award in the event of the retirement, disability,
death or other termination of a participant's employment shall be as determined
by the Committee as set forth in the award Agreement.
Awards. The following types of awards may be granted under the
Stock Incentive Plan:
Stock Options. Stock Options may be granted in the form of
incentive stock options within the meaning of Section 422 of the
Internal Revenue Code (the "Code") or stock options not meeting such
Code definition ("nonqualified stock options"). The Plan permits all of
the shares available under the Plan to be awarded in the form of
incentive stock options if the Committee so determines. The exercise
period for any stock option will be determined by the Committee at the
time of grant which may provide that options may be exercisable in
installments. The exercise price per share of Common Stock of any
option may not be less than the fair market value of a share of Common
Stock on the date of grant. Each stock option may be exercised in
whole, at any time, or in part, from time to time, after the grant
becomes exercisable. The exercise price is payable in cash, in shares
of already owned Common Stock or in any combination of cash and shares,
or by such methods as the Committee may deem appropriate, including but
not limited to loans by the Company on such terms and conditions as the
Committee may determine. No award other than stock options may be made
to any director (other than a director who is an employee at the time
of the award).
Stock Appreciation Rights. Stock appreciation rights ("SARs")
may be granted independently of any stock option or in tandem with all
or any part of a stock option granted under the Plan, upon such terms
and conditions as the Committee may determine. Upon exercise, an SAR
entitles a participant to receive the excess of the fair market value
of a share of Common Stock on the date the SAR is exercised over the
fair market value of a share of Common Stock on the date the SAR is
granted. The Committee will determine whether an SAR will be settled in
cash, Common Stock or a combination of cash and Common Stock. Upon
exercise of an SAR granted in conjunction with a stock option, the
option or the portion thereof to which the SAR relates will be
surrendered.
Restricted Shares. Restricted shares are shares of Common
Stock that may not be sold or otherwise disposed of during a restricted
period after grant, the duration of which will be determined by the
Committee. The Committee may provide for the lapse of such restrictions
in installments. Restricted shares may be voted by the recipient.
Dividends on the restricted shares may be payable to the recipient in
cash or in additional restricted shares. A recipient of a grant of
restricted shares will generally earn unrestricted ownership thereof
only if the individual is continuously employed by the Company or a
subsidiary during the entire restricted period.
- 18 -
<PAGE>
Performance Shares. Performance shares are grants of shares of
Common Stock which are earned by achievement of performance goals
established for the award by the Committee. During the applicable
performance period determined by the Committee for an award, the shares
may be voted by the recipient and the recipient is also entitled to
receive dividends thereon unless the Committee determines otherwise. If
the applicable performance criteria are met, at the end of the
applicable performance period, the shares are earned and become
unrestricted. The Committee may provide that a certain percentage
(which may be greater than 100%) of the number of shares originally
awarded may be earned based upon the attainment of the performance
goals.
Stock Units. Stock units are fixed or variable share or dollar
denominated units valued, at the Committee's discretion, in whole or in
part by reference to, or otherwise based on, the fair market value of
the Company's Common Stock. The Committee will determine the terms and
conditions applicable to stock units, including any applicable
restrictions, conditions or contingencies, which may be related to
individual, corporate or other categories of performance. A stock unit
may be payable in Common Stock, cash or a combination of both. An
employee who receives a stock unit may be given rights to dividend
equivalents on such stock units, payable in cash, stock, or additional
stock units, subject to any conditions the Committee may impose.
Other Incentive Awards. The Committee may grant other types of
awards of Common Stock or awards based in whole or in part by reference
to Common Stock ("Other Incentive Awards"). Such Other Incentive Awards
include, without limitation, restricted share units, performance share
units, unrestricted stock grants (to other than executive officers),
dividend or dividend equivalent rights or awards related to the
establishment or acquisition by the Company or any subsidiary of a new
or start-up business or facility. The Committee will determine the time
at which grants of such Other Incentive Awards are to be made, the size
of such awards and all other conditions of such awards, including any
restrictions, deferral period or performance requirements. The
recipient will have the right to receive currently or on a deferred
basis as determined by the Committee, interest or dividends, or
interest or dividend equivalents. Common Stock issued on a bonus basis
pursuant to Other Incentive Awards may be issued for no cash
consideration to nonexecutive officers of the Company.
Except to the extent permitted by specific terms of any nonqualified
stock options, no award will be assignable or transferable except by will, the
laws of descent and distribution or, in the Committee's discretion, in certain
other manners.
Adjustments. In the event there is a change in the capital structure of
the Company as a result of any stock dividend or split, recapitalization,
merger, consolidation or spin-off or other similar corporate change, the
Committee may make an adjustment in the number of shares of Common Stock
available for issuance, the number of shares covered by any outstanding award
and the price per share thereof. In the event there is a change of control (as
defined in the Stock Incentive Plan) of the Company all options and SARs
outstanding shall become immediately exercisable and remain exercisable for
their entire term, all restrictions on restricted shares will lapse and, unless
otherwise specified in a participant's award agreement, all performance goals
applicable to any awards shall be deemed attained at the maximum payment level.
Amendments and Termination. The Board of Directors may at any time
amend, suspend or terminate the Stock Incentive Plan, to the extent permitted by
law; provided, however, no such action may affect in any material way any awards
previously granted thereunder. Any such action by the Board of Directors may be
taken without the approval of the shareholders of the Company to the extent that
such approvals are not required by applicable law or regulation. There is no set
termination date for the Plan, although no incentive options may be granted more
than 10 years after the effective date of the Plan.
- 19 -
<PAGE>
Federal Income Tax Considerations. The following discussion summarizes
the federal income tax consequences to participants who may receive grants of
awards under the Stock Incentive Plan. The discussion is based upon
interpretations of the Code in effect as of January 1, 2000, and the regulations
promulgated thereunder as of such date.
Nonqualified Stock Options. For federal income tax purposes,
no income is recognized by a participant upon the grant of a
nonqualified stock option under the Stock Incentive Plan. Upon the
exercise of a nonqualified option, compensation taxable as ordinary
income will be realized by the participant in an amount equal to the
excess of the fair market value of a share of Common Stock on the date
of such exercise over the exercise price. A subsequent sale or exchange
of such shares will result in gain or loss measured by the difference
between (a) the exercise price, increased by any compensation reported
upon the participant's exercise of the option and (b) the amount
realized on such sale or exchange. Such gain or loss will be capital in
nature if the shares were held as a capital asset and will be long-term
if such shares were held for more than one year.
The Company is entitled to a deduction for compensation paid
to a participant at the same time and in the same amount as the
participant is considered to have realized compensation by reason of
the exercise of an option.
Incentive Stock Options. No taxable income is realized by the
participant pursuant to the exercise of an incentive stock option
granted under the Stock Incentive Plan, and if no disqualifying
disposition of such shares is made by such participant within two years
after the date of grant or within one year after the transfer of such
shares to such participant, then (a) upon sale of such shares, any
amount realized in excess of the option price will be taxed to such
participant as a long-term capital gain and any loss sustained will be
a long-term capital loss, and (b) no deduction will be allowed to the
Company for Federal income tax purposes. Upon exercise of an incentive
stock option, the participant may be subject to alternative minimum tax
on certain items of tax preference.
If the shares of Common Stock acquired upon the exercise of an
incentive stock option are disposed of prior to the expiration of the
two-years-from-grant/one-year-from-transfer holding period, generally
(a) the participant will realize ordinary income in the year of
disposition in an amount equal to the excess (if any) of the fair
market value of the shares at exercise (or, if less, the amount
realized on the disposition of the shares) over the option price
thereof, and (b) the Company will be entitled to deduct such amount.
Any further gain or loss realized will be taxed as short-term or
long-term capital gain or loss, as the case may be, and will not result
in any deduction by the Company.
If an incentive stock option is exercised at a time when it no
longer qualifies as an incentive stock option, the option is treated as
a nonqualified stock option.
Stock Appreciation Rights. No taxable income is recognized by
a participant upon the grant of an SAR under the Stock Incentive Plan.
Upon the exercise of an SAR, however, compensation taxable as ordinary
income will be realized by the participant in an amount equal to the
cash received upon exercise, plus the fair market value on the date of
exercise of any shares of Common Stock received upon exercise. Shares
of Common Stock received on the exercise of an SAR will be eligible for
capital gain treatment, with the capital gain holding period commencing
on the date of exercise of the SAR.
The Company is entitled to a deduction for compensation paid
to a participant at the same time and in the same amount as the
participant is considered to have realized compensation by reason of
the exercise of the SAR.
- 20 -
<PAGE>
Restricted and Performance Shares. A recipient of restricted
shares or performance shares generally will be subject to tax at
ordinary income rates on the fair market value of the Common Stock at
the time the restricted shares or performance shares are no longer
subject to forfeiture. However, a recipient who so elects under Section
83(b) of the Code within 30 days of the date of the grant will have
ordinary taxable income on the date of the grant equal to the fair
market value of the restricted shares or performance shares as if the
restricted share were unrestricted or the performance shares were
earned and could be sold immediately. If the shares subject to such
election are forfeited, the recipient will not be entitled to any
deduction, refund or loss for tax purposes with respect to the
forfeited shares. Upon sale of the restricted shares or performance
shares after the forfeiture period has expired, the holding period to
determine whether the recipient has long-term or short-term capital
gain or loss begins when the restriction period expires. However, if
the recipient timely elects to be taxed as of the date of the grant,
the holding period commences on the date of the grant and the tax basis
will be equal to the fair market value of the shares on the date of the
grant as if the shares were then unrestricted and could be sold
immediately.
Stock Units. A recipient of stock units will generally be
subject to tax at ordinary income rates on the fair market value of any
Common Stock issued pursuant to such an award, and the Company will
generally be entitled to a deduction equal to the amount of the
ordinary income realized by the recipient. The fair market value of any
Common Stock received will generally be included in income (and a
corresponding deduction will generally be available to the Company) at
the time of receipt. The capital gain or loss holding period for any
Common Stock distributed under an award will begin when the recipient
recognizes ordinary income in respect of that distribution.
Other Incentive Awards. The federal income tax consequences of
Other Incentive Awards will depend on how such awards are structured.
Generally, the Company will be entitled to a deduction with respect to
such awards only to the extent that the recipient realizes compensation
income in connection with such awards. It is anticipated that Other
Incentive Awards will usually result in compensation income to the
recipient in some amount. However, some forms of Other Incentive Awards
may not result in any compensation income to the recipient or any
income tax deduction for the Company.
Performance Goals and Maximum Awards. Section 162(m) disallows federal
income tax deductions for certain compensation in excess of $1,000,000 per year
paid to each of the Company's Chief Executive Officer and its other four most
highly compensated executive officers (collectively, the "Covered Employees").
Under Section 162(m), compensation that qualifies as "other performance-based
compensation" is not subject to the $1,000,000 limit. One of the conditions
necessary to qualify certain incentive awards as "other performance-based
compensation" is that the material terms of the performance goals under which
the award is made must be disclosed to, and approved by, the shareholders of the
Company before the incentive compensation is paid.
For those types of awards under the Stock Incentive Plan which require
performance criteria to meet the definition of "other performance-based
compensation" the Committee will, from time to time, establish performance
criteria with respect to an award. These performance criteria may be measured in
absolute terms or measured against, or in relationship to, other companies
comparably, similarly or otherwise situated and may be based on, or adjusted
for, other objective goals, events, or occurrences established by the Committee
for a performance period, including earnings, earnings growth, revenues,
expenses, stock price, market share, charge-offs, loan loss reserves, reductions
in non-performing assets, return on assets, return on equity, return on
investment, regulatory compliance, satisfactory internal or external audits,
improvements in financial ratings, achievement of balance sheet or income
statement objectives, extraordinary charges, losses from discontinued
operations, restatements and accounting changes and other unplanned special
charges such as restructuring expenses, acquisition expenses including goodwill,
unplanned stock offerings and strategic loan loss provisions. The performance
criteria related to an award
- 21 -
<PAGE>
must be established by the Committee prior to the completion of 25% of the
performance period or such earlier date as may be required by Section 162(m) of
the Code.
At the end of each performance period for an award, the Committee will
determine the extent to which the performance criteria established for the
performance period have been achieved and determine the pay out of the
performance award. The committee may, in its sole discretion, reduce or
eliminate the payout of any award to the extent permitted under the Stock
Incentive Plan and applicable law.
Plan Benefits. The following table provides certain information with
respect to all awards which have been made under the 1997 Stock Incentive Plan
(and certain predecessor plans) to specific individuals and groups of
individuals, specifying the amounts granted to Named Executive Officers
individually, all current directors who are not executive officers as a group,
all director nominees individually, all current executive officers as a group
and all employees, including current officers who are not executive officers, as
a group.
<TABLE>
<CAPTION>
NUMBER OF UNITS 1
-----------------
PERFORMANCE STOCK RESTRICTED
NAME AND POSITION SHARES OPTIONS SHARES
- ----------------- ------ ------- ------
<S> <C>
Edward J. Wehmer, -- 165,938 --
President and Chief Executive Officer
David A. Dykstra, -- 66,371 --
Executive Vice President / Chief Financial Officer
Robert F. Key, -- 44,700 --
Executive Vice President / Director of Marketing
Lloyd M. Bowden, -- 32,003 --
Executive Vice President / Director of Technology
Todd A. Gustafson -- 1,500 --
Vice President / Finance
Director Nominees, named individually
James E. Mahoney -- 1,208 --
James B. McCarthy -- 2,051 --
John W. Leopold -- -- --
Dorothy M. Mueller -- -- --
Thomas J. Neis -- -- --
J. Christopher Reyes -- 4,005 --
Peter P. Rusin -- 187 --
Edward J. Wehmer -- 165,938 --
Executive Officer Group -- 328,012 --
Non-Executive Officer Director Group -- 92,688 --
Non-Executive Officer Employee Group -- 1,116,546 --
<FN>
(1) Includes all awards to each specified individual or group of
individuals made prior to April 15, 2000.
</FN>
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS VOTE FOR APPROVAL OF THE
AMENDMENT TO THE 1997 STOCK INCENTIVE PLAN.
- 22 -
<PAGE>
INDEPENDENT AUDITORS
Ernst and Young LLP served as the Company's independent auditor for
1999. One or more representatives of Ernst and Young LLP will be present at the
meeting and will have the opportunity to make a statement if they desire to do
so and will be available at the meeting to respond to appropriate questions.
SHAREHOLDER PROPOSALS
Shareholders' proposals intended to be presented at the Company's 2001
Annual Meeting of Shareholders must be received in writing by the Secretary of
the Company no later than December 22, 2000, in order to be considered for
inclusion in the proxy material for that meeting. Any such proposals shall be
subject to the requirements of the proxy rules adopted under the Securities
Exchange Act of 1934 (the "Exchange Act"). Furthermore, in order for any
shareholder to properly propose any business for consideration at the 2001
Annual Meeting, including the nomination of any person for election as a
director, or any other matter raised other than pursuant to Rule 14a-8 of the
proxy rules adopted under the Exchange Act, written notice of the shareholder's
intention to make such proposal must be furnished to the Company in accordance
with the By-laws. Under the provisions of the By-laws, the deadline for such
notice is March 25, 2001.
OTHER BUSINESS
The Company is unaware of any other matter to be acted upon at the
annual meeting for shareholder vote. In case of any matter properly coming
before the meeting for shareholder vote, unless discretionary authority has been
denied the proxy holders named in the proxy accompanying this statement shall
vote them in accordance with their best judgment.
BY ORDER OF THE BOARD OF DIRECTORS
David A. Dykstra
Secretary
- 23 -
<PAGE>
The Directors and Officers of
Wintrust Financial Corporation
cordially invite you to attend our
2000 Annual Meeting of Shareholders
Thursday, May 25, 2000, 10:00 a.m.
Michigan Shores Club
911 Michigan Avenue
Wilmette, Illinois
YOU CAN VOTE IN ONE OF THREE WAYS: 1) BY MAIL, 2) BY PHONE, 3) BY INTERNET.
See the reverse side of this sheet for instructions.
IF YOU ARE NOT VOTING BY TELEPHONE OR BY INTERNET, COMPLETE BOTH SIDES OF THE
---
PROXY CARD, DETACH HERE AND RETURN IN THE ENCLOSED ENVELOPE TO:
Illinios Stock Transfer Co.
209 West Jackson Boulevard, Suite 903
Chicago, Illinois 60606
IMPORTANT
---------
Please complete both sides of the PROXY CARD, sign, date,
detach and return in the enclosed envelope.
- --------------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. IF NOT OTHERWISE
SPECIFIED ON THE REVERSE SIDE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED
AND FOR PROPOSAL 2. THE UNDERSIGNED REVOKES ALL PROXIES HERETOFORE GIVEN TO VOTE
AT SUCH MEETING AND ALL ADJOURNMENTS OR POSTPONEMENTS.
Dated _____________________
___________________________
___________________________
(Please sign here)
Please sign your name as it appears above. If executed by a corporation, a duly
authorized officer should sign. Executors, administrators, attorneys, guardians
and trustees should so indicate when signing. If shares are held jointly, at
least one holder must sign.
- --------------------------------------------------------------------------------
Wintrust Financial Corporation
If you personally plan to attend the Annual Meeting of Shareholders, please
check the box below and list the names of attendees on reverse side.
Return this stub in the enclosed envelope with your completed proxy card.
I/We do plan to attend
the 2000 meeting ________
<PAGE>
TO VOTE BY MAIL
To vote by mail, complete both sides, sign and date the proxy card below. Detach
the card below and return it in the envelope provided.
TO VOTE BY TELEPHONE
Your telephone vote is quick, confidential and immediate. Just follow these easy
steps:
1. Read the accompanying Proxy Statement.
2. Using a Touch-Tone telephone, call Toll Free 1-800-555-8140 and follow the
instructions.
3. When asked for your Voter Control Number, enter the number printed just above
your name on the front of the proxy card below. Please note that all votes cast
by telephone must be submitted prior to midnight Central Time, May 23, 2000.
Your telephone vote authorizes the named proxies to vote your shares to the same
extent as if you marked, signed, dated and returned the proxy card.
If You Vote By TELEPHONE Please Do Not Return Your Proxy Card By Mail
TO VOTE BY INTERNET
Your internet vote is quick, confidential and your vote is immediately
submitted. Just follow the se easy steps:
1. Read the accompanying Proxy Statement.
2. Visit our Internet voting Site at HTTP://WWW.EPROXYVOTE.COM/IST-WFCCM/ and
follow the instructions on the screen.
3. When prompted for your Voter Control Number, enter the number printed just
above your name on the front of the proxy card. Please note that all votes cast
by internet must be submitted prior to midnight Central Time, May 23, 2000. Your
Internet vote authorizes the named proxies to vote your shares to the same
extent as if you marked, signed, dated and returned the proxy card.
THIS IS A "SECURED" WEB PAGE SITE. YOUR SOFTWARE AND/OR INTERNET PROVIDER MUST
BE ENABLED TO ACCESS THIS SITE. PLEASE CALL YOUR SOFTWARE OR INTERNET PROVIDER
FOR FURTHER INFORMATION.
If You Vote By Internet, Please Do Not Return Your Proxy Card By Mail
- --------------------------------------------------------------------------------
Wintrust Financial Corporation
REVOCABLE PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints John S. Lillard and Edward J. Wehmer and either
of themas Proxies, each with the power to appoint his substitute, and hereby
authorizes each them to represent and to vote, as designated below, all the
shares of Common Stock of Wintrust Financial Corporation which the undersigned
is entitled to vote at the Annual Meeting of Shareholders to be held on May 25,
2000 or any adjournment thereof. If any other business is presented at the
Annual Metting, including whether or not to adjourn the metting, this proxy will
be voted, to the extent legally permissable, by those named in this proxy in
their best judgement.
PROPOSAL 1 - ELECTION OF DIRECTORS (To be designated as Class I
Directors with term ending in 2003.)
[ ] FOR ALL NOMINEES LISTED BELOW
(Except as marked to the contrary below).
[ ] WITHHOLD AUTHORITY to vote for all nominees below.
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR
ANY INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH THE
NOMINEE'S NAME).
01 JAMES E. MAHONEY 05 THOMAS J. NEIS
02 JAMES B. MCCARTHY 06 J. CHRISTOPHER REYES
03 JOHN W. LEOPOLD 07 PETER P. RUSIN
04 DOROTHY M. MUELLER 08 EDWARD J. WEHMER
PROPOSAL 2 - APPROVAL OF AN AMENDMENT TO THE 1997 STOCK INCENTIVE PLAN,
AS DESCRIBED IN THE PROCY STATEMENT
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(To be signed on the other side)
<PAGE>
