SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
BIG FOOT FINANCIAL CORP.
------------------------
(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.
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
_________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
_________________________________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined.):
_________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
_________________________________________________________________________
5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
_________________________________________________________________________
2) Form, Schedule or Registration Statement No.:
_________________________________________________________________________
3) Filing Party:
_________________________________________________________________________
4) Date Filed:
<PAGE>
[Letterhead of Big Foot Financial Corp.]
September 10, 1998
Dear Shareholder:
You are cordially invited to attend the 1998 Annual Meeting of
Shareholders (the "Annual Meeting") of Big Foot Financial Corp. (the "Company"),
the holding company for Fairfield Savings Bank, F.S.B. (the "Bank"), Long Grove,
Illinois, which will be held on October 20, 1998 at the Holiday Inn Mundelein,
located at 510 East Route 83, Mundelein, Illinois 60060 at 3:00 p.m., Central
Time.
The attached Notice of the 1998 Annual Meeting of Shareholders and
Proxy Statement describe the formal business to be transacted at the Annual
Meeting. Directors and officers of the Company, as well as a representative of
KPMG Peat Marwick LLP, the accounting firm appointed by the Board of Directors
to be the Company's independent auditors for the fiscal year ending June 30,
1999, will be present at the Annual Meeting to respond to appropriate questions.
The Board of Directors of the Company has determined that an
affirmative vote on each matter to be considered at the Annual Meeting is in the
best interests of the Company and its shareholders and unanimously recommends a
vote "FOR" each of these matters.
Please complete, sign and return the enclosed proxy card promptly
whether or not you plan to attend the Annual Meeting. YOUR VOTE IS IMPORTANT
REGARDLESS OF THE NUMBER OF SHARES YOU OWN. VOTING BY PROXY WILL NOT PREVENT YOU
FROM VOTING IN PERSON AT THE ANNUAL MEETING BUT WILL ASSURE THAT YOUR VOTE IS
COUNTED IF YOU ARE UNABLE TO ATTEND. IF YOU ARE A SHAREHOLDER WHOSE SHARES ARE
NOT REGISTERED IN YOUR OWN NAME, YOU WILL NEED ADDITIONAL DOCUMENTATION FROM
YOUR RECORD HOLDER TO ATTEND AND TO VOTE PERSONALLY AT THE ANNUAL MEETING.
EXAMPLES OF SUCH DOCUMENTATION INCLUDE A BROKER'S STATEMENT, LETTER OR OTHER
DOCUMENT CONFIRMING YOUR OWNERSHIP OF SHARES OF THE COMPANY.
On behalf of the Board of Directors and the employees of the Company
and the Bank, we thank you for your continued support and appreciate your
interest.
Sincerely yours,
/s/ George M. Briody
----------------------------------------
George M. Briody
PRESIDENT AND CHIEF EXECUTIVE OFFICER
<PAGE>
BIG FOOT FINANCIAL CORP.
OLD MCHENRY ROAD AND ROUTE 83
LONG GROVE, ILLINOIS 60047
(847) 634-2100
NOTICE OF THE 1998 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 20, 1998
NOTICE IS HEREBY GIVEN that the 1998 Annual Meeting of Shareholders of
Big Foot Financial Corp. (the "Company") will be held on October 20, 1998 at the
Holiday Inn Mundelein, located at 510 East Route 83, Mundelein, Illinois 60060,
at 3:00 p.m., Central Time, to consider and vote upon the following matters:
1. Election of two candidates to the Board of Directors, each to
serve for a term of three years;
2. Ratification of the appointment of KPMG Peat Marwick LLP as
independent auditors for the fiscal year ending June 30, 1999;
and
3. Such other matters as may properly come before the Annual
Meeting or any adjournment or postponement thereof. The
Company is not aware of any other business that may properly
come before the Annual Meeting.
The Board of Directors has fixed September 4, 1998 as the record date
for the determination of shareholders entitled to notice of and to vote at the
Annual Meeting and any adjournment or postponement thereof. Only shareholders of
record at the close of business on that date will be entitled to notice of and
to vote at the Annual Meeting and any adjournment or postponement thereof.
By Order of the Board of Directors,
/s/ Barbara J. Urban
--------------------
Barbara J. Urban
SECRETARY
Long Grove, Illinois
September 10, 1998
- --------------------------------------------------------------------------------
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. IT IS IMPORTANT THAT
YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER OF SHARES YOU OWN. THE BOARD
OF DIRECTORS URGES YOU TO SIGN, DATE AND MARK THE ENCLOSED PROXY CARD PROMPTLY
AND RETURN IT IN THE ENCLOSED ENVELOPE. RETURNING THE PROXY CARD WILL NOT
PREVENT YOU FROM VOTING IN PERSON IF YOU ATTEND THE ANNUAL MEETING.
- --------------------------------------------------------------------------------
<PAGE>
BIG FOOT FINANCIAL CORP.
PROXY STATEMENT FOR THE
1998 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 20, 1998
GENERAL INFORMATION
GENERAL
This Proxy Statement and accompanying proxy card are being furnished to
the shareholders of Big Foot Financial Corp. (the "Company") in connection with
the solicitation of proxies by the Board of Directors of the Company from
holders of the shares of the Company's issued and outstanding common stock, par
value $.01 per share (the "Common Stock"), as of the close of business on
September 4, 1998 (the "Record Date"), for use at the 1998 Annual Meeting of
Shareholders of the Company (the "Annual Meeting") to be held on October 20,
1998 at the Holiday Inn Mundelein, located at 510 East Route 83, Mundelein,
Illinois 60060, at 3:00 p.m., Central Time, and at any adjournment or
postponement thereof. This Proxy Statement, together with the enclosed proxy
card, is first being mailed to shareholders on or about September 10, 1998.
On December 19, 1996, the Company became the holding company for
Fairfield Savings Bank, F.S.B. (the "Bank") upon completion of the conversion of
the Bank from the mutual form of organization into the stock form of
organization (the "Conversion"). The Company, an Illinois corporation, operates
as a savings association holding company for its wholly-owned subsidiary, the
Bank.
RECORD DATE AND VOTING RIGHTS
The Board of Directors of the Company has fixed the close of business
on September 4, 1998 as the Record Date for the determination of the Company's
shareholders entitled to notice of and to vote at the Annual Meeting.
Accordingly, only holders of record of shares of Common Stock at the close of
business on such date will be entitled to vote at the Annual Meeting. On the
Record Date, there were 2,493,100 shares of Common Stock issued and outstanding.
Each holder of shares of Common Stock outstanding at the close of
business on the Record Date will be entitled to one vote for each share held of
record (other than Excess Common Stock as defined below) at the Annual Meeting
and at any adjournment or postponement thereof. The presence, in person or by
proxy, of the holders of at least a majority of the total number of votes
eligible to be cast in the election of directors generally by the holders of the
outstanding shares of Common Stock entitled to vote at the Annual Meeting is
necessary to constitute a quorum thereat.
The Articles of Incorporation of the Company provide that if any person
beneficially owns, directly or indirectly, shares of Common Stock in excess of
10% of the then outstanding shares of Common Stock, all such shares beneficially
owned by such person in excess of the 10% threshold shall be automatically
converted into shares of Excess Common Stock. Shares of Excess Common Stock are
identical to shares of Common Stock except that they are permitted only one
one-hundredth (1/100) of a vote per share. Beneficial ownership of shares
includes shares beneficially owned by such person or any of his or her
affiliates, shares which such person or his or her affiliates have the right to
acquire upon the exercise of conversion rights or options and shares as to which
such person and his or her affiliates have or share investment or voting power,
but shall not include shares beneficially owned by the Company's Employee Stock
Ownership Plan (the "ESOP") or shares that are subject to a revocable proxy and
that are not otherwise beneficially owned or deemed by the Company to be
beneficially owned by such person and his or her affiliates. The Articles of
Incorporation further provide that this provision may be amended only upon the
approval of the Board of Directors or the vote of two-thirds of the votes
eligible to be cast by holders of all outstanding shares of voting stock (after
giving effect to the limitation on voting rights).
<PAGE>
The Company's Articles of Incorporation authorize and impose a duty on the Board
of Directors, by action of a majority, to interpret all of the terms and
provisions of the Articles of Incorporation governing Excess Common Stock and to
determine on the basis of information known to them after reasonable inquiry all
facts necessary to ascertain compliance with the Articles of Incorporation,
including, without limitation, (i) the number of shares of Common Stock
beneficially owned by any person or purported owner; (ii) whether a person or
purported owner is an affiliate or associate of any other person or purported
owner; or (iii) any other matter relating to the applicability or effect of the
Articles of Incorporation.
All properly executed proxies received by the Company will be voted in
accordance with the instructions indicated thereon. IF NO INSTRUCTIONS ARE
GIVEN, EXECUTED PROXIES WILL BE VOTED FOR ELECTION OF EACH OF THE TWO NOMINEES
FOR DIRECTOR, AND FOR THE OTHER PROPOSAL IDENTIFIED IN THE NOTICE OF THE 1998
ANNUAL MEETING OF SHAREHOLDERS. Management is not aware of any matters other
than those set forth in the Notice of the 1998 Annual Meeting of Shareholders
that may be brought before the Annual Meeting. If any other matters properly
come before the Annual Meeting, the persons named in the accompanying proxy card
will vote the shares represented by all properly executed proxies on such
matters in such manner as shall be determined by a majority of the Board of
Directors of the Company.
VOTE REQUIRED
The vote required for each proposal is set forth in the discussion of
such proposal under the caption "--Vote Required."
REVOCABILITY OF PROXIES
A proxy may be revoked at any time before it is voted by filing with
the Secretary of the Company a duly executed instrument revoking the proxy or by
submitting a duly executed proxy bearing a later date. A proxy may also be
revoked by attending and voting at the Annual Meeting or any adjournment or
postponement thereof, if a written revocation is filed with the Secretary of the
Annual Meeting prior to the voting of such proxy.
IF YOU ARE A SHAREHOLDER WHOSE SHARES ARE NOT REGISTERED IN YOUR OWN
NAME, YOU WILL NEED APPROPRIATE DOCUMENTATION FROM YOUR SHAREHOLDER OF RECORD TO
VOTE PERSONALLY AT THE ANNUAL MEETING. Examples of such documentation would
include a broker's statement, letter or other document that will confirm
your ownership of shares of the Company.
SOLICITATION OF PROXIES
The Company will bear the costs of soliciting proxies from its
shareholders. In addition to the use of mail, proxies may be solicited by
officers, directors or employees of the Company and the Bank, by telephone or
through other forms of communication. The Company will also request persons,
firms and corporations holding shares in their names or in the name of their
nominees, which are beneficially owned by others, to send proxy materials to and
obtain proxies from such beneficial owners, and will reimburse such holders for
reasonable expenses incurred in connection therewith. In addition, the Company
has retained Morrow & Co. to assist in the solicitation of proxies, which firm
will be paid a fee of $3,000, plus expenses.
2
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
PRINCIPAL SHAREHOLDERS OF THE COMPANY
The following table sets forth, as of July 31, 1998, certain
information as to Common Stock beneficially owned by persons owning in excess of
5% of the outstanding shares of Common Stock. Management knows of no person,
except as listed below, who beneficially owned more than 5% of the Company's
outstanding shares of Common Stock as of July 31, 1998. Except as otherwise
indicated, the information provided in the following table was obtained from
filings with the Securities and Exchange Commission (the "SEC") and with the
Company pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Addresses provided are those listed in the filings as the
address of the person authorized to receive notices and communications. For
purposes of the table below and the table set forth under "Security Ownership of
Management," in accordance with Rule 13d-3 under the Exchange Act, a person is
deemed to be the beneficial owner of any shares of Common Stock (1) over which
such person has or shares, directly or indirectly, voting or investment power,
or (2) of which such person has the right to acquire beneficial ownership at any
time within 60 days after July 31, 1998. As used herein, "voting power" is the
power to vote or direct the voting of shares, and "investment power" includes
the power to dispose or direct the disposition of such shares.
<TABLE>
<CAPTION>
PERCENT OF
AMOUNT AND COMMON
NAME AND ADDRESS OF NATURE OF STOCK
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP OUTSTANDING(1)
- -------------------------- --------------------------------------- ---------------------------- -----------------
<S> <C> <C> <C>
Common Stock, par Big Foot Financial Corp. 200,715(2) 8.0%
value $.01 per share Employee Stock Ownership
Plan Trust
Old McHenry Road and Route 83
Long Grove, Illinois 60047
</TABLE>
- --------------
(1) The total number of shares of Common Stock outstanding on July 31, 1998 was
2,152,750 shares.
(2) The ESOP is administered by a Plan Administrator, who is an employee of the
Company appointed by the Board of Directors. The ESOP's assets are held in a
trust (the "ESOP Trust"), for which First Bankers Trust Company, N.A. serves
as trustee (the "Trustee"). Under the terms of the ESOP, the Trustee votes
the shares held by the ESOP Trust based upon directions received from the
participants in the ESOP. As of June 30, 1998, 30,153 shares had been
allocated to participants, and 170,867 were unallocated. Under the terms of
the ESOP, each participant may direct the voting of the shares allocated to
such participant. The remaining unallocated shares are voted in the same
manner and proportion as the shares allocated, so long as such vote is in
accordance with the provisions of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA").
3
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information with respect to the shares
of Common Stock beneficially owned by each Director of the Company, by each
Named Executive Officer of the Company identified in the Summary Compensation
Table included elsewhere herein and all directors and executive officers of the
Company as a group, as of July 31, 1998. Except as otherwise indicated, each
person and each group shown in the table has sole voting and investment power
with respect to the shares of Common Stock indicated.
<TABLE>
<CAPTION>
AMOUNT AND PERCENT OF
NATURE OF COMMON
BENEFICIAL STOCK
NAME TITLE (1) OWNERSHIP(2)(3)(4)(5) OUTSTANDING(6)
- ---- --------- --------------------- --------------
<S> <C> <C> <C>
George M. Briody (7) President and Director 64,617 2.6%
F. Gregory Opelka (8) Executive Vice President 49,840 2.0%
and Director
Maurice F. Leahy (9) Director 11,030 *
Eugene W. Pilawski (10) Director 26,680 1.1%
Joseph J. Nimrod (11) Director 39,830 1.6%
Walter E. Powers, M.D. (12) Director 16,093 *
William B. O'Connell (13) Director 21,030 *
Timothy L. McCue (14) Vice President and Chief
Financial Officer 40,051 1.6%
All directors and executive
officers as a group
(11 persons)(15) 562,547 21.9%
</TABLE>
- ----------------
* Less than 1.0% of outstanding Common Stock.
(1) Titles are for both the Company and the Bank.
(2) See "Principal Shareholders of the Company" for a definition of
"beneficial ownership."
(3) Includes restricted stock awards of 4,020 shares of Common Stock made to
each of Messrs. Leahy, Pilawski, Nimrod, Powers and O'Connell under the
Big Foot Financial Corp. 1997 Recognition and Retention Plan (the
"RRP"). Also includes restricted stock awards of 19,235, 15,735 and
15,224 shares of Common Stock made to Messrs. Briody, Opelka and McCue,
respectively, under the RRP. Each recipient of an RRP restricted share
award has sole voting power but no investment power over the shares of
Common Stock covered by the award.
(4) The figures shown above include shares held in trust pursuant to the
ESOP that have been allocated to individual accounts as follows: Mr.
Briody, 3,209 shares; Mr. Opelka, 2,015 shares; Mr. McCue, 1,753 shares;
and all directors and executive officers as a group, 10,457 shares. Such
persons have voting power (subject to the legal duties of the ESOP
Trustee) but no investment power, except in limited circumstances, over
such shares.
(5) Includes 2,010 shares of Common Stock which may be acquired by each of
Messrs. Leahy, Pilawski, Nimrod, Powers and O'Connell pursuant to
options granted to each outside director under the Big Foot Financial
Corp. 1997 Stock Option Plan (the "Stock Option Plan"). The figures
above also include 11,056, 7,539 and 7,538 shares of Common Stock which
may be acquired by Messrs. Briody, Opelka and McCue, respectively, under
the Stock Option Plan.
(6) Percentages with respect to each person or group of persons have been
calculated on the basis of 2,512,750 shares of Common Stock, the total
number of shares of the Company's Common Stock outstanding as of July
31, 1998, plus the number of shares of Common Stock which such person or
group has the right to acquire within 60 days after July 31, 1998, by
the exercise of stock options.
(7) Includes 5,990 shares held in the Fairfield Savings Bank Profit Sharing
and Savings Plan ("401(k) Plan") and 1,255 held by Mr. Briody's spouse.
Mr. Briody disclaims beneficial ownership of the 1,255 shares held by
his spouse.
(FOOTNOTES CONTINUED ON FOLLOWING PAGE)
4
<PAGE>
(8) Includes 6,000 shares held by Mr. Opelka's spouse and 3,551 shares held
by his son. Mr. Opelka disclaims beneficial ownership of the shares held
by his spouse and son.
(9) Includes 683 shares held by Mr. Leahy's spouse.
(10) Includes 5,650 shares held by Mr. Pilawski's spouse. Mr. Pilawski
disclaims beneficial ownership of the 5,650 shares held by his spouse.
(11) Includes 9,500 shares held by a corporation of which Mr. Nimrod is a
controlling shareholder and 3,750 shares held by his spouse. Mr. Nimrod
disclaims beneficial ownership of the 3,750 shares held by his spouse.
(12) Include 2,899 shares held by Dr. Powers' spouse. Dr. Powers disclaims
beneficial ownership of the 2,899 shares held by his spouse.
(13) Includes 15,000 shares held jointly with Mr. O'Connell's spouse as to
which Mr. O'Connell has shared voting power.
(14) Includes 14,400 shares held in the 401(k) Plan and 536 shares held by
Mr. McCue's spouse. Mr. McCue disclaims beneficial ownership of the 536
shares held by his spouse.
(15) The amount of shares for all executive officers and directors as a group
includes 170,867 shares held by the ESOP Trust, over which certain
directors and executive officers may be deemed to have shared investment
power, that have not yet been allocated to the individual accounts of
the participants as of July 31, 1998. The individual participants in the
ESOP have shared voting power with the ESOP Trustee. The amount of
shares for all executive officers and directors as a group also includes
59,611 shares held by the RRP trust, over which certain executive
officers may be deemed to have shared investment power.
-----------------------------------------------------------------
PROPOSAL 1
ELECTION OF DIRECTORS
-----------------------------------------------------------------
GENERAL
The Articles of Incorporation and Bylaws of the Company provide for the
election of directors by the shareholders. For this purpose, the Board of
Directors of the Company is divided into three classes with respect to term of
office, each class to contain, as near as may be possible, one-third of the
entire number of the Board, with the terms of office of one class expiring at
each annual meeting. At each annual meeting of shareholders, the successors to
the class of directors (other than directors elected by holders of shares of one
or more series of Preferred Stock, of which there currently are none) whose term
expires at that time shall be elected by the shareholders to serve for a term of
three years. There are currently seven directors of the Company.
The terms of two directors expire at the Annual Meeting. The Board of
Directors has nominated the two incumbent directors, Eugene W. Pilawski and
Walter E. Powers, M.D., to be re-elected at the Annual Meeting for a three-year
term expiring at the annual meeting of shareholders to be held in 2001, or when
their successors are otherwise duly elected and qualified. Each nominee has
consented to being named in this Proxy Statement and to serve if elected. The
terms of the remaining two classes of directors expire at the annual meetings of
shareholders to be held in 1999 and 2000, or when their successors are otherwise
duly elected and qualified.
In the event that any nominee for election as a director at the Annual
Meeting is unable or declines to serve, which the Board of Directors has no
reason to expect, the persons named in the Proxy Card will vote with respect to
a substitute nominee. Such substitute shall be designated by the incumbent Board
of Directors by delivery to the Secretary, not fewer than five (5) days prior to
the date of the Annual Meeting, of a written notice of substitution.
5
<PAGE>
VOTE REQUIRED
Directors are elected by a plurality of the votes cast by each class of
shares present and entitled to vote in the election at the Annual Meeting. The
holders of Common Stock may not vote their shares cumulatively for the election
of directors. Shares underlying broker non-votes will not be counted as having
been voted in person or by proxy and will have no effect on the election of
directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE
NOMINEES FOR ELECTION AS DIRECTORS.
INFORMATION AS TO NOMINEES AND CONTINUING DIRECTORS
The following table sets forth certain information with respect to each
nominee for election as a director and each director whose term does not expire
at the Annual Meeting ("Continuing Director"). There are no arrangements or
understandings between the Company and any director or nominee pursuant to which
such person was elected or nominated to be a director of the Company. For
information with respect to security ownership of directors, see "Security
Ownership of Certain Beneficial Owners and Management -- Security Ownership of
Management."
<TABLE>
<CAPTION>
POSITIONS HELD WITH DIRECTOR TERM
NOMINEES AGE(1) THE COMPANY SINCE(2) EXPIRES
- -------- ------ ----------- -------- -------
<S> <C> <C> <C>
Eugene W. Pilawski................ 75 Director 1990 2001
Walter E. Powers, M.D............. 70 Director 1977 2001
CONTINUING DIRECTORS
Maurice F. Leahy.................. 68 Director 1978 1999
William B. O'Connell.............. 75 Director 1989 1999
George M. Briody.................. 71 President, Director 1951 2000
Joseph J. Nimrod.................. 69 Director 1978 2000
Executive Vice President,
F. Gregory Opelka................. 70 Director 1972 2000
</TABLE>
- ----------------
(1) At June 30, 1998.
(2) Includes terms as a director of Fairfield Savings Bank, F.S.B.
The principal occupation and business experience of each nominee for
election as director and each Continuing Director are set forth below. Positions
held by a director or executive officer have been held for at least the past
five years unless stated otherwise.
NOMINEES FOR ELECTION AS DIRECTOR
EUGENE W. PILAWSKI joined the Bank in 1949 and serves as a director of
the Bank and the Company. Now retired, he had served as Senior Vice President of
the Bank from 1987 to 1992. Mr. Pilawski has also served as Vice President and
Senior Loan Officer of the Bank. He was elected to the Board of Directors in
September, 1990. Mr. Pilawski is a member of the Chicago Bar Association. Mr.
Pilawski and Dr. Powers are brothers.
WALTER E. POWERS, M.D. serves as a director of the Bank and the Company
and has served as a director of the Bank since 1977. Dr. Powers, now retired,
was a radiologist-flight surgeon for United Airlines, Inc. from 1973 to 1985. He
is a member of the American Medical Association, Illinois State Medical Society,
Chicago
6
<PAGE>
Medical Society, American College of Radiology, Radiology Society of North
America and Illinois Radiology Society. Dr. Powers and Mr. Pilawski are
brothers.
CONTINUING DIRECTORS
MAURICE F. LEAHY serves as a director of the Bank and the Company and
has been a director of the Bank since 1978. Now retired, he was an account
executive for P.M.P. Sales, Inc., a meat and poultry broker. Previously he owned
and operated a meat and poultry retail business for more than 25 years.
WILLIAM B. O'CONNELL serves as a director of the Bank and the Company
and has served as a director of the Bank since November, 1989. Immediately prior
thereto, Mr. O'Connell served as a Chairman of U.S. League Management Services,
Inc. (the "League"), a coordinating organization for the special service
projects of the U.S. League of Savings Institutions, Inc. He served as President
of the League from 1980 to 1988.
GEORGE M. BRIODY serves as the President and a director of the Bank and
the Company. Mr. Briody has been involved in the financial institutions industry
for more than 40 years and has served as President of the Bank since 1966 and as
a director since 1951. He also has served as a director of the Chicago Area
Council, the Illinois Savings and Loan League, the FHLB of Chicago, the U.S.
League of Savings Institutions, Inc. and Electronic Funds Transfer Corporations
I and II. Mr. Briody is currently a member of the Central Savings and Loan
Group. He is also a member of the Illinois and Chicago Bar Associations. He is a
past president of the Central Savings and Loan Group and the Illinois Savings
and Loan League. Mr. Briody and Mr. Opelka are brothers-in-law.
JOSEPH J. NIMROD serves as a director of the Bank and the Company and
has been a director of the Bank since 1978. Mr. Nimrod is the owner of Joseph
Nimrod Decorating Inc., a painting and paperhanging business. He also served as
a former officer and a director of the Painters and Decorators Contractors
Association and is Chairman of the Washburn Apprentice School of Painting. Mr.
Nimrod also serves as a trustee of the Painting Industry Fund.
F. GREGORY OPELKA serves as the Executive Vice President and a director
of the Bank and the Company. Mr. Opelka joined the Bank in 1954 and has served
as a director since 1972. He is a member of the Appraisal Institute and holds
Member, Senior Real Estate Analyst, and Senior Residential Appraiser
designations. He is currently a director of the Market Data Center and an
appraisal consultant authoring "Appraisal Report," a quarterly article for the
America's Community Banker's member magazine. Mr. Opelka and Mr. Briody are
brothers-in-law.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS OF THE COMPANY AND THE BANK
The Board of Directors meets on a monthly basis and may have additional
special meetings from time to time. During the fiscal year ended June 30, 1998,
the Board of Directors of the Bank met 12 times and the Company's Board of
Directors met nine times. No current director attended fewer than 75% of the
total number of Board meetings and committee meetings of which such director was
a member.
The Company and the Bank have established the following committees of
each of their respective Boards of Directors:
The MANAGEMENT SALARY COMPENSATION COMMITTEE of both the Company and
the Bank consists of Messrs. Powers, Leahy and Nimrod. The committee reviews and
makes recommendations to their respective Board of Directors regarding the
compensation of executive officers of the Company and the Bank.
The AUDIT COMMITTEE of both the Company and the Bank consists of
Messrs. Nimrod and Powers. The Audit Committee meets periodically with the
Company's independent certified public accountants in connection with the
Company's annual financial statement audit and to review and evaluate
recommendations made during the annual audit. The Audit Committee also reviews
the regulatory reports of examination.
7
<PAGE>
EXECUTIVE OFFICERS
The following individuals are executive officers of the Company and
hold the offices set forth below opposite their names.
NAME POSITION HELD WITH THE COMPANY
---- ------------------------------
George M. Briody President and Chief Executive Officer
F. Gregory Opelka Executive Vice President
Timothy L. McCue Vice President, Chief Financial Officer
Robert Jones Vice President, Chief Savings Officer
Michael Cahill Vice President, Controller
Jerome A. Maher Vice President, Chief Lending Officer
The executive officers of the Company are elected annually and hold
office until their respective successors have been elected and qualified, or
until death, resignation or removal by the Board of Directors. The Company has
entered into Employment Agreements with certain of its executive officers which
set forth the terms of their employment. See "--Employment Agreements."
Biographical information of executive officers of the Company or the
Bank who are not directors is set forth below.
TIMOTHY L. MCCUE, age 53, has served as the Bank's Vice President,
Chief Financial Officer since December 1984. He is a member of the American
Institute of Certified Public Accountants and the Illinois CPA Society. Mr.
McCue served as the Regional District Director for Financial Managers Society.
ROBERT JONES, age 55, has served as the Bank's Vice President, Chief
Savings Officer since April 1987.
MICHAEL CAHILL, age 44, has served as Vice President, Controller of the
Bank since 1986.
JEROME A. MAHER, age 63, joined the Bank in June, 1996 and has served
as Vice President, Chief Lending Officer since February, 1997. Mr. Maher served
as Vice President and director of Covenant Mortgage Corporation from March 1994
to June 1996 and as a Senior Vice President of Hanover Capital Mortgage
Corporation from July 1993 to February 1994. Prior to that, Mr. Maher was an
Executive Vice President and director of Labe Federal Savings and Loan
Association.
8
<PAGE>
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
MANAGEMENT SALARY COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
THE FOLLOWING REPORT OF THE COMPANY'S MANAGEMENT SALARY COMPENSATION
COMMITTEE IS PROVIDED IN ACCORDANCE WITH THE RULES AND REGULATIONS OF THE SEC.
PURSUANT TO SUCH RULES AND REGULATIONS, THIS REPORT SHALL NOT BE DEEMED
"SOLICITING MATERIAL," FILED WITH THE SEC, SUBJECT TO REGULATION 14A OR 14C OF
THE SEC OR SUBJECT TO THE LIABILITIES OF SECTION 18 OF THE EXCHANGE ACT.
Big Foot Financial, Corp. was formed in 1996 for the purpose of
becoming the holding company for Fairfield Savings Bank, F.S.B. in a stock
conversion that took effect in December 1996. For the fiscal year ended June 30,
1998, substantially all of the business of the Company was conducted through the
Bank. During such fiscal year, the Company's Chief Executive Officer and other
executive officers served as the Chief Executive Officer and executive officers,
respectively, of the Bank and performed substantially all of their services in
connection with the management and operation of the Bank. As a result,
substantially all compensation of the Chief Executive Officer and all other
executive officers for such period was paid by the Bank and determined by the
Board of Directors of the Bank on the recommendation of its Management Salary
Compensation Committee (the "Bank Management Salary Compensation Committee").
The Board of Directors of the Bank accepted without modification all of the Bank
Management Salary Compensation Committee's recommendations on executive
compensation for the fiscal year ended June 30, 1998. The Composition of the
Bank Management Salary Compensation Committee is the same as that of the
Company's Management Salary Compensation Committee.
It is the Company's policy to cause its executive officers to be
compensated, either directly or through its affiliates, using a combination of
cash compensation (consisting of base salary and discretionary cash bonuses) and
fringe benefit plans. These elements are intended to provide an overall
compensation package that is commensurate with the Company's financial
resources, that is appropriate to assure the retention of experienced management
personnel and align their financial interests with those of the Company's
shareholders, and that is responsive to the immediate and long-term needs of
executive officers and their families. The compensation practices of other
savings and community banks in the geographic area are considered, using
information obtained through trade groups and commercial salary surveys, in
establishing the overall level of compensation and the components of the
compensation package; although salaries are not determined by formula, it has
been a general goal to set salaries at levels designed to achieve a ranking at
or around the average for thrift institutions of similar asset size operating in
urban areas in the Midwest.
For the fiscal year ended June 30, 1998, base salaries of all executive
officers were set at levels determined, in the subjective judgment of the Bank
Management Salary Compensation Committee, to be commensurate with the executive
officers' customary respective duties and responsibilities and to enable them to
maintain appropriate standards of living within their communities. Annual salary
rates were increased by an average of approximately 6.5% over the prior year's
salary rates. Fringe benefit plans, consisting of a pension plan, a profit
sharing 401(k) plan providing for employer matching contributions and group
insurance coverage, are designed to provide for the health and welfare of the
executives and their families as well as for their long-term financial needs. In
addition, the Company maintains an ESOP and all executive officers participated
in this program for the fiscal year ended June 30, 1998 and received allocations
of Common Stock for this past fiscal year. Each executive officer has an
individual account within the ESOP Trust which is invested in shares of Common
Stock with the result that a portion of each executive officer's long-term
retirement savings is tied to the performance of the Bank and the Company.
Concurrently with the establishment of the ESOP, the Bank discontinued its prior
practice of making profit-sharing contributions to participants in the 401(k)
plan, since annual allocations under the ESOP serve the same function as the
Bank's profit-sharing contributions.
The determination of the Chief Executive Officer's compensation for the
fiscal year ended June 30, 1998 was based on the same general principles applied
to other executive officers and resulted in a 4.2% salary increase, with no cash
incentive payment.
9
<PAGE>
The Bank Management Salary Compensation Committee recognizes that
successfully managing and operating a public company entails additional ongoing
duties and responsibilities for each executive officer. However, no additional
cash compensation has been awarded on this basis. It is the Bank Management
Salary Compensation Committee's current judgment that compensation for such
duties should take the form of stock-based compensation under the Company's
stock benefit plans which encourage and reward performance that enhances
shareholder value. In this connection, the Company, with the approval of
shareholders, implemented its 1997 Stock Option Plan on June 24, 1997 and its
1997 Recognition and Retention Plan on December 22, 1997. These important
stock-based incentive compensation plans assist the Bank and the Company in
attracting and retaining senior executive personnel of outstanding caliber who
will contribute to the Company's success.
MANAGEMENT SALARY COMPENSATION
COMMITTEE OF BIG FOOT FINANCIAL
CORP.
JOSEPH J. NIMROD, CHAIRMAN
MAURICE F. LEAHY, MEMBER
WALTER E. POWERS, MEMBER
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the fiscal year ended June 30, 1998, the Management Salary
Compensation Committee consisted of Messrs. Powers, Leahy and Nimrod. During the
1998 fiscal year there were no interlocks, as defined under the rules and
regulations of the SEC, between members of the Management Salary Compensation
Committee or executive officers of the Company and corporations with respect to
which such persons are affiliated, or otherwise.
10
<PAGE>
PERFORMANCE GRAPH
The following graph compares the Company's total cumulative shareholder
return from December 19, 1996, the date of the Company's initial public
offering, to June 30, 1998, to the total return for the Nasdaq Stock
Market (U.S.) and the total return for the Nasdaq Bank Index.
Comparison of 18 Month Cumulative Total Return
Among Big Foot Financial Corp.,
The Nasdaq Stock Market (U.S.) Index
and the Nasdaq Bank Index
[Performace Graph}
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
12/20/96 12/31/96 3/31/97 6/30/97 9/30/97 12/31/97 3/31/98 6/30/98
-------- -------- ------- ------- ------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Big Foot Financial
Corp. $ 100 $ 130 $ 141 $ 161 $ 174 $ 210 $ 210 $ 180
Nasdaq Stock
Market (U.S.) 100 100 94 112 131 123 143 148
Nasdaq Bank Index 100 101 108 126 148 168 178 175
</TABLE>
Assumes $100 Invested on December 20, 1996.
Assumes dividends reinvested.
- --------------------------------------------------------------------------------
THERE CAN BE NO ASSURANCE THAT STOCK PERFORMANCE WILL CONTINUE INTO THE FUTURE
WITH THE SAME OR SIMILAR TRENDS DEPICTED IN THE GRAPH ABOVE.
11
<PAGE>
DIRECTORS' COMPENSATION
FEE ARRANGEMENTS. Currently, each director of the Bank receives a
monthly fee of $1,100. The aggregate amount of fees paid to such directors by
the Bank for the fiscal year ended June 30, 1998 was approximately $91,000. No
additional fees are paid for attendance at board committee meetings and
directors of both the Company and the Bank are not separately compensated for
their services on the Board of the Company. Directors have also been granted
stock options under the Company's 1997 Stock Option Plan ("Stock Option Plan")
and restricted stock awards, under the Company's 1997 Recognition and Retention
Plan ("RRP"). For descriptions of the Stock Option Plan and RRP and awards
granted under such plans, see "--Benefits -- Stock Option Plan" and "-- Benefits
- -- Recognition and Retention Plan."
EXECUTIVE COMPENSATION
COMPENSATION DECISIONS. Substantially all of the compensation of the
officers of the Bank is paid by the Bank. Decisions regarding executive
compensation are made by the Bank's Board of Directors based on recommendations
of the Management Salary Compensation Committee, the membership of which
excludes those directors employed by the Bank. Under this structure, no
interlocks exist between members of the Management Salary Compensation Committee
and employees of the Bank.
CASH COMPENSATION. The following table sets forth the cash
compensation paid by the Bank for services rendered in all capacities during the
fiscal year ended June 30, 1998, to the Chief Executive Officer and all
executive officers of the Bank who received compensation in excess of $100,000
(the "Named Executive Officers").
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG TERM COMPENSATION
----------------------
ANNUAL COMPENSATION(1)(2) AWARDS PAYOUTS
------------------------- -------------------- -------
OTHER RESTRICTED
ANNUAL STOCK LTIP ALL OTHER
NAME AND PRINCIPAL COMPENSATION AWARDS OPTIONS PAYOUTS COMPENSATION
POSITIONS YEAR SALARY($) BONUS($) ($)(3) ($)((4) (#) ($) ($)(5)
--------- ---- --------- -------- ------ ------- --- --- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
George M. Briody,
President.............. 1998 $167,340 $15,548 -- $37,018 -- -- $39,557
1997 $147,840 $14,888 -- -- 55,280 -- $25,384
1996 $157,180 $14,550 -- -- -- -- $14,907
F. Gregory Opelka,
Executive Vice
President.............. 1998 $111,745 $10,095 -- $30,280 -- -- $25,101
1997 $ 97,850 $ 9,485 -- -- 37,693 -- $16,153
1996 $103,145 $ 9,240 -- -- -- -- $ 9,376
Timothy L McCue, Vice
President and Chief
Financial Officer..... 1998 $ 99,784 $ 8,941 -- $30,280 -- -- $21,789
1997 $ 87,276 $ 8,351 -- -- 37,691 -- $14,136
1996 $ 91,810 $ 8,130 -- -- -- -- $ 8,220
</TABLE>
- -------------------
(1) Under Annual Compensation, the column titled "Salary" includes base
salary, director's and/or management's fees and payroll deductions for
health insurance under the Bank's health insurance plan for the 11
months ended June 30, 1997, and the fiscal years ended June 30, 1998
and July 31, 1996.
(2) Figures for the fiscal year ended June 30, 1997 represent amounts paid
for the period of 11 months coinciding with the short fiscal year.
(3) For fiscal 1998, there were no: (a) perquisites with an aggregate value
for any named individual in excess of the lesser of $50,000 or 10% of
the total of the individual's salary and bonus for the year; (b)
payments of above-market preferential earnings on deferred
compensation; (c) payments of earnings with respect to long-term
incentive plans prior to settlement or maturation; or (d) preferential
discounts on stock.
(FOOTNOTES CONTINUED ON FOLLOWING PAGE)
12
<PAGE>
(4) Pursuant to the RRP, Mr. Briody, Mr Opelka and Mr. McCue were awarded
19,235, 15,735 and 15,735 shares of restricted stock, respectively as
of December 22, 1997, which vest at a rate of 10% on June 30, 1998; 20%
on June 30, 1999, 2000, 2001 and 2002; and 10% on January 1, 2003.
Dividends attributable to such shares are held in the trust fund of the
RRP and are distributed as soon as it is administratively feasible. The
dollar amounts shown in the table for 1998 are based on the fair market
value of a share of Common Stock on December 22, 1997, which was
$19.25. The aggregate fair market value of the restricted stock awards
made to Messrs. Briody, Opelka and McCue were $34,614, $28,314 and
$28,314, respectively, on June 30, 1998, based on a closing price of
$18.00 per share. During the fiscal years ended June 30, 1997, and July
31, 1996, neither the Bank nor the Company maintained any restricted
stock plans. In the case of death, disability, retirement while in
service and after attaining normal retirement age under any applicable
tax-qualified retirement plan or prior to the effective date of any
change in control of the Company, all restricted stock awards become
immediately vested.
(5) Includes (a) employer contributions to the 401(k) Plan for 1998, 1997
and 1996 as follows: Mr. Briody, $1,685, $7,566 and $14,907; Mr.
Opelka, $1,485, $4,817 and $9,376; and Mr. McCue, $1,305, $4,219 and
$8,220; and (b) allocations of Common Stock under the ESOP (valued
using a price per share of $18.00 and $16.125, the closing sales price
for shares of Common Stock on The Nasdaq Stock Market on June 30, 1998
and 1997, respectively) for 1998 and 1997 as follows: Mr. Briody,
$37,872 and $17,818; Mr. Opelka, $23,616 and $11,336; and Mr. McCue,
$20,484 and $9,917. No allocations were made under the ESOP for the
fiscal year ended July 31, 1996.
EMPLOYMENT AGREEMENTS
Effective December 19, 1996, the Company and the Bank entered into
Employment Agreements with each of Messrs. Briody, Opelka, McCue, Jones, and
Cahill (the "Senior Executives"). These Employment Agreements establish the
respective duties and compensation of the Senior Executives and are intended to
ensure that the Bank and the Company will be able to maintain a stable and
competent management base. The continued success of the Bank and the Company
depends to a significant degree on the skills and competence of the Senior
Executives.
The Employment Agreements provide for three-year terms. The Bank's
Employment Agreements provide that, commencing on the first anniversary date and
continuing on each anniversary date thereafter, the Board of Directors may, with
the Senior Executive's concurrence, extend the Employment Agreements for an
additional year, so that the remaining terms shall be three years, after
conducting a performance evaluation of the Senior Executive. The Company's
Employment Agreements provide for automatic daily extensions such that the
remaining terms of the Employment Agreements shall be three years unless written
notice of non-renewal is given by the Board of Directors or the Senior
Executive. The Employment Agreements provide that the Senior Executive's base
salary will be reviewed annually. This review will be performed by the
Management Salary Compensation Committee, and the Senior Executive's base salary
may be increased on the basis of such officer's job performance and the overall
performance of the Bank. The Employment Agreements also provide for, among other
things, entitlement to participation in stock, retirement and welfare benefit
plans and eligibility for fringe benefits applicable to executive personnel such
as a company car and fees for club and organization memberships deemed
appropriate by the Bank or Company and each Senior Executive. The Employment
Agreements provide for termination by the Bank or the Company at any time for
cause as defined in the Employment Agreements.
In the event the Bank or the Company chooses to terminate the Senior
Executive's employment for reasons other than for cause, or in the event of the
Senior Executive's resignation from the Bank and the Company for the reasons
specified in the Employment Agreements, the Senior Executive would be entitled
to a lump sum cash payment in an amount equal to the present value of the
remaining cash compensation due to the Senior Executive and the additional
contributions or benefits that would have been earned under any employee benefit
plans of the Bank or the Company during the remaining terms of the Employment
Agreements and payments that would have been made under any incentive
compensation plan during the remaining terms of the Employment Agreements. The
Bank and the Company would also continue the Senior Executive's life, health and
any disability insurance or other benefit plan coverage for specified periods.
Reasons specified as grounds for resignation for purposes of the Employment
Agreements are: failure to elect or re-elect the Senior Executive to such
officer's offices; failure to vest in the Senior Executive the functions, duties
or authority associated with such offices; any material breach of contract by
the Bank or the Company which is not cured within 30 days after written notice
thereof; and, following a Change of Control (as defined in the Employment
Agreements), demotion, loss of title, office or significant authority or
responsibility, any reduction in any element of compensation or benefits, any
adverse
13
<PAGE>
change of location of the principal place of employment or working conditions.
In general, for purposes of the Employment Agreements and the plans maintained
by the Company or the Bank, a "change of control" will generally be deemed to
occur when a person or group of persons acting in concert acquires beneficial
ownership of 25% or more of any class of equity security of the Company or the
Bank, upon shareholder approval of a merger or consolidation or a change of the
majority of the Board of Directors of the Company or the Bank or upon
liquidation or sale of substantially all the assets of the Company or the Bank.
Payments to the Senior Executives under the Bank's Employment
Agreements will be guaranteed by the Company in the event that payments or
benefits are not paid by the Bank. Payment under the Company's Employment
Agreements would be made by the Company. To the extent that payments under the
Company's Employment Agreements and the Bank's Employment Agreements are
duplicative, payments due under the Company's Employment Agreements would be
offset by amounts actually paid by the Bank. Senior Executives would be entitled
to reimbursement of certain costs incurred in interpreting or enforcing the
Employment Agreements.
Cash and benefits paid to a Senior Executive under the Employment
Agreements, together with payments under other benefit plans following a "change
of control" of the Bank or the Company, may constitute an "excess parachute"
payment under Section 280G of the Internal Revenue Code of 1986, as amended (the
"Code"), resulting in the imposition of a 20% excise tax on the recipient and
the denial of the deduction for such excess amounts to the Company and the Bank.
The Company's Employment Agreements include a provision indemnifying each Senior
Executive on an after-tax basis for any "golden parachute" excise taxes.
BENEFITS
PENSION PLAN. The Bank maintains the Fairfield Savings Bank Retirement
Plan, a non-contributory, tax-qualified defined benefit pension plan (the
"Pension Plan") for eligible employees. All employees with more than 1,000 hours
of service per year, except leased employees, who have attained age 21 and
completed one year of service are eligible to participate in the Pension Plan.
The Pension Plan provides a benefit for each participant, including executive
officers named in the Summary Compensation Table above. The benefit is equal to
an amount (A) minus (B) where (A) is an amount equal to (i) 2% of the
participant's final average compensation multiplied by the participant's
projected benefit service, reduced by (ii) the participant's social security
offset allowance, and such result multiplied by (iii) a fraction, the numerator
of which equals the participant's benefit service and the denominator of which
is the participant's projected benefit service, and (B) is the amount to which
the participant is entitled under the Fairfield Savings and Loan Association
Pension Plan (the predecessor of the Pension Plan). A participant's social
security offset allowance shall equal 0.6% multiplied by the participant's years
of projected benefit service not in excess of 35 years, multiplied by the lesser
of the participant's (i) final average offset compensation or (ii) covered
compensation, divided by twelve.
Final average offset compensation is the monthly average of a
participant's compensation over sixty (60) consecutive months of employment out
of the participant's last 120 month period of employment during which the
participant's compensation is the highest. A participant is fully vested in his
or her pension after five years of service. The Pension Plan is funded by the
Bank on an actuarial basis, and all assets are held in trust by the Pension Plan
trustee.
14
<PAGE>
The following table illustrates the annual benefit payable upon normal
retirement at age 65 in the normal form of benefit under the Pension Plan (a
straight life annuity) at various levels of annual compensation (12 times final
average offset compensation) and years of service under the Pension Plan. The
amounts in the table are subject to a social security benefit offset allowance
and further reduction by the amount to which a participant is entitled under the
Fairfield Savings and Loan Association Pension Plan, a predecessor qualified
plan.
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE
ANNUAL AVERAGE -------------------------
COMPENSATION 15 20 25 30 35
------------ -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$125,000 $ 37,500 $ 50,000 $ 62,500 $ 75,000 $ 87,500
150,000(1) 45,000 60,000 75,000 90,000 105,000
175,000(1) 52,500 70,000 87,500 105,000 122,500(2)
200,000(1) 60,000 80,000 100,000 120,000(2) 140,000(2)
</TABLE>
- -----------------
(1) For the Pension Plan year ended July 31, 1998, the annual compensation
for calculating benefits may not exceed $150,000 (as adjusted for
subsequent years pursuant to Code provisions).
(2) For the Pension Plan year ended July 31, 1998, the maximum annual
benefit under the Pension Plan may not exceed $120,000. The maximum
annual benefit will be adjusted in subsequent years pursuant to Code
provisions. The Company does not maintain a supplemental plan to make
up for benefits that would be paid under the Pension Plan formula in
the absence of the limitations under the Code.
The following table sets forth the years of credited service and the
final average compensation (monthly average of a participant's compensation over
sixty (60) consecutive months of employment out of the participant's last 120
month period of employment during which the participant's compensation is the
highest) determined as of June 30, 1998, the end of the 1998 plan year, for each
of the individuals named in the Summary Compensation Table.
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE
------------------------- FINAL AVERAGE
YEARS MONTHS COMPENSATION
----- ------ ------------
<S> <C> <C> <C>
Mr. Briody 48 0 $144,952
Mr. Opelka 43 7 92,404
Mr. McCue 13 6 81,251
</TABLE>
401(K) PLAN. The Bank maintains a 401(k) Plan, which permits salaried
employees with at least one year of service to make pre-tax salary deferrals
under section 401(k) of the Code and after-tax contributions under section
401(a) of the Code. Salary deferrals are made by election and are limited to 15%
of compensation up to $160,000 (for 1998), or to a limit imposed under the Code
($9,500 for fiscal 1998). The Bank makes matching contributions equal to 25% of
the amount of pre-tax salary deferrals, up to 6% of salary. The 401(k) Plan also
provides for discretionary contributions as the Bank may determine. For plan
years beginning prior to August 1, 1996, the 401(k) Plan required the Bank to
contribute annually an amount equal to 2% of the base annual salary of
participants. Employer contributions, other than matching contributions, were
discontinued on a prospective basis in connection with the implementation of the
ESOP described herein.
The 401(k) Plan permits participating employees to invest all or any
part of their account balances in the Company's Common Stock. Common Stock held
by the 401(k) Plan may be newly issued or treasury shares acquired from the
Company or outstanding shares purchased in the open market or in privately
negotiated transactions. All Common Stock held by the 401(k) Plan is held by an
independent trustee and allocated to the accounts of individual participants.
Participants control the exercise of voting and tender rights relating to the
Common Stock held in their accounts.
EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST. The Company has established,
and the Bank has adopted for the benefit of eligible employees, an ESOP and
related trust which became effective December 19, 1996. Substantially all
employees of the Bank or the Company who have attained age 21 and have completed
one year of service may be eligible to become participants in the ESOP. The ESOP
purchased eight percent (8%) of the
15
<PAGE>
Common Stock issued in the Conversion. Although contributions to the ESOP are
discretionary, the Company and the Bank intend to make annual contributions to
the ESOP in an aggregate amount at least equal to the principal and interest
requirement on the debt. This loan is for a term of 10 years, with interest at
the rate of 8% per annum and level annual payments of principal plus accrued
interest, designed to amortize the loan over its term. The loan also permits
optional prepayments. The Company and the Bank may make additional annual
contributions to the ESOP to the maximum extent deductible for federal income
tax purposes.
Shares purchased by the ESOP are initially pledged as collateral for
the loan and will be held in a suspense account until released for allocation
among participants in the ESOP as the loan is repaid. The pledged shares will be
released annually from the suspense account in an amount proportional to the
repayment of the ESOP loan for each plan year. The released shares will be
allocated among the accounts of participants on the basis of the participants'
base taxable salary for the year of allocation. Benefits generally become vested
at the rate of 20% per year beginning on completion of a participant's third
year of service with 100% vesting after seven years of service (including past
service). Participants also become immediately vested upon termination of
employment due to death, retirement at age 65 or older, permanent disability or
upon the occurrence of a change of control. Forfeitures of unvested amounts will
be reallocated among remaining participating employees in the same proportion as
contributions.
In connection with the establishment of the ESOP, a Plan Administrator
was appointed to administer the ESOP (the "Plan Administrator"). The Plan
Administrator may instruct the ESOP Trustee regarding investment of funds
contributed to the ESOP. The ESOP Trustee, subject to their fiduciary duty, must
vote all allocated shares held in the ESOP in accordance with the instructions
of the participating employees. Under the ESOP, unallocated shares will be voted
in a manner calculated to most accurately reflect the instructions received from
participants regarding the allocated stock as long as such vote is in accordance
with the provisions of ERISA.
The ESOP may purchase additional shares of Common Stock in the future,
in the open market or otherwise, and may do so either on a leveraged basis with
borrowed funds or with cash dividends, periodic employer contributions or other
cash flow. Whether such purchases will be made and the terms and conditions of
any such purchases will be determined by the ESOP's fiduciaries taking into
account such factors as they consider relevant at the time, including their
judgment as to the attractiveness of the Common Stock as an investment, the
price at which Common Stock may be purchased and, in the case of leveraged
purchases, the terms and conditions on which borrowed funds are available and
the willingness of the Company or the Bank to offer purchase money financing or
guarantee purchase money financing offered by third parties.
STOCK OPTION PLAN. The Stock Option Plan was adopted by the Board of
Directors of the Company and approved by the Company's shareholders at a special
meeting of the shareholders on June 24, 1997. The purpose of the Stock Option
Plan continues to be to promote the growth of the Company, the Bank and other
affiliates by linking the incentive compensation for officers, key employees and
directors with the profitability of the Company. The Stock Option Plan is not
subject to ERISA and is not a tax-qualified plan. The Company has reserved an
aggregate of 251,275 shares of Common Stock for issuance upon the exercise of
stock options granted under the Stock Option Plan.
The members of the Board's Compensation Committee who are disinterested
directors ("Option Committee") administer the Stock Option Plan. In general,
both "incentive stock options" and non-qualified stock options to purchase the
Company's Common Stock ("Options") may be granted to eligible officers,
employees and outside directors, subject the restrictions of the Code. The
Option Committee has discretion under the Stock Option Plan to establish certain
material terms of the Options granted to officers and employees provided such
grants are made in accordance with the Plan's requirements. All Options granted
to outside directors are by automatic formula grant and the Option Committee has
no discretion over the material terms of these grants. As of the effective date
of the Stock Option Plan, each outside director of the Company was granted a
non-qualified stock option to purchase an aggregate of 10,051 shares of Common
Stock at an exercise price of $15.625 per share.
All stock options granted under the Plan generally vest in 20%
increments over a five year period, subject to full vesting upon the optionee's
death, disability, retirement or upon a change in control of the Company, as
16
<PAGE>
defined in the Stock Option Plan, beginning June 24, 1998. The Company believes
the use of a vesting schedule will encourage each Option recipient to remain in
the service of the Company (or an affiliate) and contribute to its profitability
in order to enjoy the full economic benefit of the Option. The Company has
reserved the right to amend or terminate the Plan, in whole or in part, subject
to the requirements of all applicable laws.
The following table provides certain information with respect to the
number of shares of Common Stock acquired through the exercise of, or
represented by, outstanding stock options held by the Named Executive Officers
on June 30, 1998. Also reported is the value of any "in-the-money" options,
which represent the positive spread between the exercise price of any such
existing stock options and the fiscal year-end price of Common Stock, which was
$18.00 per share.
<TABLE>
<CAPTION>
FISCAL YEAR END OPTIONS/SAR VALUES
NUMBER OF SECURITIES VALUE OF UNEXCERCISED
SHARES VALUE UNDERLYING UNEXERCISED IN-THE-MONEY
ACQUIRED ON REALIZED ON OPTIONS/SARS AT FISCAL OPTIONS/SARS AT FISCAL
EXERCISE EXERCISE YEAR-END YEAR-END
(#) ($)
NAME (1) (#) (1) (S) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE (2)
-------- ------- --- ------------------------- -----------------------------
<S> <C> <C> <C> <C>
George M. Briody -- -- 11,056/44,224 26,258/105,032
F. Gregory Opelka -- -- 7,539/30,154 17,905/ 71,616
Timothy L. McCue -- -- 7,538/30,153 17,903/ 71,613
</TABLE>
- -------------
(1) None of the Named Executive Officers exercised options during the
fiscal year ended June 30, 1998.
(2) Of the total outstanding stock options held by Mr. Briody, Mr. Opelka
and Mr. McCue, all of the unexercisable options are "in-the-money"
options.
The Company has reserved 251,275 shares of the Common Stock for
issuance upon exercise of Options. Such Shares may be authorized and unissued
shares or shares previously issued and reacquired by the Company. Any Shares
subject to options under the Stock Option Plan which expire or are terminated,
forfeited or canceled without having been exercised or vested in full, shall
again be available to support additional grants under the Stock Option Plan.
RECOGNITION AND RETENTION PLAN. The RRP was adopted by the Board of
Directors of the Company and approved by the Company's shareholders at the 1997
Annual Meeting. Similar to the Stock Option Plan, the RRP functions as a
long-term incentive compensation program for eligible officers, employees and
outside directors of the Company, the Bank and other affiliates. The RRP is
administered by the members of the Board's Compensation Committee who are
disinterested directors ("RRP Committee"). All costs and expenses of
administering the RRP are paid by the Company.
As required by the terms of the RRP, the Company has established a
trust ("Trust") and has contributed to the Trust, funds sufficient to purchase
up to 100,510 shares of Common Stock, the maximum number of restricted stock
awards ("Restricted Stock Awards") that may be granted under the RRP. Shares of
Common Stock subject to a Restricted Stock Award are held in the Trust until the
Award vests at which time the shares of Common Stock attributable to the portion
of the Award that has vested are distributed to the Award holder. An Award
recipient is entitled to exercise voting rights and receive cash dividends with
respect to the shares of Common Stock subject to his Award, whether or not the
underlying shares have vested. If an individual award recipient terminates
service prior to full vesting of the Restricted Stock Awards granted pursuant to
the RRP, the shares subject to the award will be forfeited and returned to the
Company.
17
<PAGE>
Restricted Stock Awards are granted under the RRP on a discretionary
basis to eligible officers and executives selected by the RRP Committee and are
awarded to outside directors pursuant to the terms of the RRP. As of July 31,
1998, each outside director has been granted a Restricted Stock Award with
respect to 4,020 shares of Common Stock. All outstanding Restricted Stock Awards
to eligible directors and eligible employees will vest and become distributable
at the rate of 10% at June 30, 1998, 20% at June 30, 1999, 2000, 2001, and 2002;
and 10% at January 1, 2003, subject to automatic full vesting on the date of the
Award holder's death, disability or retirement while in service and after
attaining age 65 or upon the effective date of a change in control of the
Company.
The Company may amend or terminate the RRP, in whole or in part, at any
time, subject to the requirements of all applicable laws.
TRANSACTIONS WITH CERTAIN RELATED PERSONS
The Financial Institutions Reform, Recovery and Enforcement Act of 1989
("FIRREA") requires that all loans or extensions of credit to executive officers
and directors must be made on substantially the same terms, including interest
rates and collateral, as those prevailing at the time for comparable
transactions with the general public and must not involve more than the normal
risk of repayment or present other unfavorable features. The Bank has made loans
or extended credit to executive officers and directors and also to certain
persons related to executive officers and directors. All such loans were made by
the Bank in the ordinary course of business and were not made with more
favorable terms nor did they involve more than the normal risk of collectibility
or present unfavorable features. The outstanding principal balance of such loans
to directors, executive officers and their associates totaled $498,000 or 1.2%
of the Company's shareholders' equity at June 30, 1998.
The Company intends that all transactions in the future between the
Company and its executive officers, directors, holders of 10% or more of the
shares of any class of its common stock and affiliates thereof, will contain
terms no less favorable to the Company than could have been obtained by it in
arm's-length negotiations with unaffiliated persons and will be approved by a
majority of independent outside directors of the Company not having any interest
in the transaction.
SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934 BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and certain officers, and persons who own more than 10% of a
registered class of the Company's equity securities to file reports of ownership
and changes in ownership with the SEC. Officers, directors and greater than 10%
shareholders are required by SEC regulation to furnish the Company with copies
of all Section 16(a) forms they file. Based solely on a review of copies of such
reports of ownership furnished to the Company, or written representations that
no forms were necessary, the Company believes that, during the last fiscal year,
all filing requirements applicable to its officers, directors and greater than
ten percent shareholders were complied with.
18
<PAGE>
-----------------------------------------------------------------
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
-----------------------------------------------------------------
GENERAL
The Board of Directors has appointed the firm of KPMG Peat Marwick LLP
to act as independent auditors for the Company for the fiscal year ending June
30, 1999, subject to ratification of such appointment by the Company's
shareholders. A representative of KPMG Peat Marwick LLP is expected to be
present at the Annual Meeting and will be given an opportunity to make a
statement if he or she desires to do so and will be available to respond to
appropriate questions. No determination has been made as to what action the
Board of Directors would take if the shareholders do not ratify KPMG Peat
Marwick LLP's appointment.
VOTE REQUIRED
The ratification of the appointment by the Board of Directors of KPMG
Peat Marwick LLP as the Company's independent auditors requires the affirmative
vote of the holders of a majority of the number of votes eligible to be cast by
the holders of shares of Common Stock represented in person or by proxy and
entitled to vote at the Annual Meeting. Accordingly, shares as to which the
"ABSTAIN" box has been selected on the Proxy Card will be counted as present and
entitled to vote and will have the effect of a vote against Proposal 2. Shares
underlying broker non-votes will not be counted as having been voted in person
or by proxy and will have no effect on the vote for Proposal 2.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR"
APPROVAL OF THE RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS.
19
<PAGE>
ADDITIONAL INFORMATION
NOTICE OF BUSINESS TO BE CONDUCTED AT ANNUAL MEETING
The Bylaws of the Company provide an advance notice procedure for a
shareholder to properly bring business before an annual meeting or to nominate
any person for election to the Board of Directors. The shareholder must be a
shareholder of record and have given timely notice thereof in writing to the
Secretary of the Company. To be timely, a shareholder's notice must be delivered
to or received by the Secretary not later than the following dates: (i) with
respect to an annual meeting of shareholders, sixty (60) days in advance of such
meeting if such meeting is to be held on a day which is within thirty (30) days
preceding the anniversary of the previous year's annual meeting, or ninety (90)
days in advance of such meeting if such meeting is to be held on or after the
anniversary of the previous year's annual meeting; and (ii) with respect to an
annual meeting of shareholders held at a time other than within the time periods
set forth in the immediately preceding clause (i), the close of business on the
tenth (10th) day following the date on which notice of such meeting is first
given to shareholders. Notice shall be deemed to first be given to shareholders
when disclosure of such date of the meeting of shareholders is first made in a
press release reported to Dow Jones News Services, Associated Press or
comparable national news service, or in a document publicly filed by the Company
with the SEC pursuant to Section 13, 14 or 15(d) of the Exchange Act. A
shareholder's notice to the Secretary shall set forth such information as
required by the Bylaws of the Company. Nothing in this paragraph shall be deemed
to require the Company to include in its proxy statement and proxy card relating
to an annual meeting any shareholder proposal or nomination which does not meet
all of the requirements for inclusion established by the SEC in effect at the
time such proposal or nomination is received. See "-- Date For Submission of
Shareholder Proposals."
DATE FOR SUBMISSION OF SHAREHOLDER PROPOSALS
Pursuant to the proxy soliciting regulation of the SEC, any shareholder
proposal intended for inclusion in the Company's proxy statement and proxy card
relating to the Company's 1999 Annual Meeting of Shareholders must be received
by the Company by May 13, 1999. Nothing in this paragraph shall be deemed to
require the Company to include in its proxy statement and proxy card for such
meeting any shareholder proposal which does not meet the requirements of the SEC
in effect at the time. Any such proposal will be subject to 17 C.F.R. ss.
240.14a-8 of the Rules and Regulations promulgated by the SEC under the Exchange
Act.
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors of the
Company does not know of any other matters to be brought before the shareholders
at the 1998 Annual Meeting.
By Order of the Board of Directors,
/s/ Barbara J. Urban
---------------------------------------------
Barbara J. Urban
SECRETARY
Long Grove, Illinois
September 10, 1998
TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE ANNUAL MEETING, PLEASE
COMPLETE, SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY CARD IN THE
POSTAGE-PAID ENVELOPE PROVIDED.
20
<PAGE>
REVOCABLE PROXY
BIG FOOT FINANCIAL CORP.
OLD MCHENRY ROAD AND ROUTE 83
LONG GROVE, ILLINOIS 60047
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
BIG FOOT FINANCIAL CORP. FOR THE ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON OCTOBER 20, 1998.
The undersigned shareholder of Big Foot Financial Corp. hereby appoints
George M. Briody, F. Gregory Opelka and Timothy L. McCue, or any of them, with
full powers of substitution, to represent and to vote as proxy, as designated,
all shares of common stock of Big Foot Financial Corp. held of record by the
undersigned on September 4, 1998, at the Annual Meeting of Shareholders (the
"Annual Meeting") to be held at 3:00 p.m., Central Time, on October 20, 1998, or
at any adjournment or postponement thereof, upon the matters described in the
accompanying Notice of Annual Meeting and Proxy Statement. The undersigned
hereby revokes all prior proxies.
This Proxy, when properly executed, will be voted in the manner
directed herein by the undersigned shareholder. IF NO DIRECTION IS GIVEN, THIS
PROXY WILL BE VOTED "FOR" THE ELECTION OF ALL NOMINEES LISTED IN ITEM 1 AND FOR
THE PROPOSAL LISTED IN ITEM 2.
PLEASE MARK, SIGN AND DATE THIS PROXY ON THE REVERSE SIDE AND RETURN IT
PROMPTLY IN THE ENCLOSED ENVELOPE.
<PAGE>
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. [GRAPHIC]
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" ALL OF THE NOMINEES
NAMED IN ITEM 1 AND A VOTE "FOR" THE PROPOSAL IN ITEM 2.
1. Election of two Directors for terms of FOR WITHHOLD FOR ALL
three years each. ALL ALL EXCEPT
NOMINEES: Eugene W. Pilawski and
Walter E. Powers [GRAPHIC] [GRAPHIC] [GRAPHIC]
INSTRUCTIONS: TO WITHHOLD AUTHORITY to vote for any individual nominee,
mark the oval "For All Except" and write that nominee's name in the space
provided:
-----------------------
Nominee Exception
2. Ratification of the appointment of FOR AGAINST ABSTAIN
KPMG Peat Marwick LLP as
independent auditors for the fiscal
year ending June 30, 1999. [GRAPHIC] [GRAPHIC] [GRAPHIC]
I will attend the Annual Meeting. [ ]
The undersigned hereby acknowledges receipt
of the Notice of the 1998 Annual Meeting of
Shareholders and the Proxy Statement for the
Annual Meeting.
---------------------------------------------
---------------------------------------------
Signature(s)
Dated:_________________________________, 1998
Please sign exactly as your name appears on
this proxy. Joint owners should each sign
personally. If signing as attorney, executor,
administrator, trustee or guardian, please
include your full title. Corporate or
partnership proxies should be signed by an
authorized officer.
<PAGE>
[Letterhead of Big Foot Financial Corp.]
September 10, 1998
TO: ALL RECOGNITION AND RETENTION PLAN ("RRP") PARTICIPANTS
Re: ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 20, 1998
Dear Participants:
As you know, Big Foot Financial Corp. ("Company") recently established
and now maintains the Big Foot Financial Corp. 1997 Recognition and Retention
Plan ("RRP") which provides for stock awards ("Awards") to certain eligible
officers and directors of the Company. A trust has been established for the RRP
holds shares of the Company's common stock pending allocation or distribution to
participants in the RRP. An independent corporate trustee ("Trustee"), has been
appointed for the RRP trust.
As a participant in the RRP, you have the right to direct the Trustee
how to vote the unvested shares of common stock that have been allocated to you
under an RRP Award and are currently held by the RRP on the proposals to be
voted on by the Company's shareholders at the Annual Meeting of Shareholders of
the Company to be held on October 20, 1998 ("Annual Meeting"). In connection
therewith, enclosed are the following documents:
1. RRP Confidential Voting Instruction Form;
2. Proxy Statement for the 1998 Annual Meeting, dated September
10, 1998 including a Notice of the 1998 Annual Meeting of
Shareholders; and
3. 1998 Annual Report to Shareholders.
RRP participants may direct how the Trustee should vote the unvested
shares of his or her RRP Award held in the RRP Trust as of the close of business
on September 4, 1998. The Trustee will vote unvested shares of the Company's
common stock subject to your RRP Award in accordance with the instructions given
on the enclosed RRP Confidential Voting Instruction Form. The number of unvested
shares contained in your RRP Award are shown on the enclosed RRP Confidential
Voting Instruction Form.
The Trustee's fiduciary duties require it not to vote any unvested
shares allocated to a participant's RRP Award for which it receives no voting
instructions. To the extent that shares have not been allocated to any
participant's RRP Award, such shares shall be voted by the Trustee in such
manner as the Committee of the RRP shall direct to reflect the voting
instructions given by participants for those unvested shares contained in
participants' RRP Awards.
* * * * *
<PAGE>
-2-
Your instruction is very important. You are encouraged to review the
enclosed material carefully and to complete, sign and date the enclosed RRP
Confidential Voting Instruction Form. RETURN IT DIRECTLY TO THE TRUSTEE USING
THE POSTAGE-PAID RETURN ENVELOPE PROVIDED. The Confidential Voting Instruction
Forms must be received by the Trustee no later than October 13, 1998. Your vote
will not be revealed to any personnel of the Company or the Bank.
IF YOU HAVE ANY QUESTIONS REGARDING YOUR VOTING RIGHTS OR THE TERMS OF
THE RRP, PLEASE CALL MR. TIMOTHY L. MCCUE AT (847) 634-2100.
Very truly yours,
THE MANAGEMENT SALARY COMPENSATION
COMMITTEE OF BIG FOOT FINANCIAL CORP.
Enclosures
<PAGE>
[Letterhead of Big Foot Financial Corp.]
September 10, 1998
TO: ALL EMPLOYEE STOCK OWNERSHIP PLAN
AND 401(K) SAVINGS PLAN PARTICIPANTS
Re: ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON OCTOBER 20, 1998
Dear Participants:
As you know, Big Foot Financial Corp. (the "Company") maintains the
Employee Stock Ownership Plan (the "ESOP") for employees of Fairfield Savings
Bank, F.S.B. (the "Bank") and the Profit Sharing and Savings Plan ("401(k)
Plan") which includes an investment alternative to purchase the stock of the
Company using funds from your 401(k) Plan account (the "401(k) Stock Fund"). The
401(k) Stock Fund and the ESOP each hold shares of the Company's common stock
for the benefit of participants in those plans. These shares are held by
independent trustees - First Bankers Trust Company, N.A. for the ESOP and George
M. Briody, F. Gregory Opelka and Eugene W. Pilawski for the 401(k) Plan - (in
each case, the "Trustee"). Shares purchased by the ESOP are being held by the
Trustee to be given to ESOP participants over a period of years. Shares that you
have purchased for your account in the 401(k) Stock Fund are being held by the
Trustee for your benefit. Both the ESOP and the 401(k) Plan allow participants
in each respective plan (including former participants and beneficiaries) to
have certain voting rights at the Company's shareholder meetings.
In connection with the Annual Meeting of Shareholders of Big Foot
Financial Corp. to be held on October 20, 1998, enclosed are the following
documents:
1. Confidential Voting Instruction card for the ESOP (blue card)
with return envelope;
2. Confidential Voting Instruction card for the 401(k) Plan
(yellow card) with return envelope;
3. Proxy Statement for the 1998 Annual Meeting dated September
10, 1998, including a Notice of the 1998 Annual Meeting of
Shareholders; and
4. 1998 Annual Report to Shareholders.
As a participant in the ESOP and/or the 401(k) Stock Fund, you have the
right to direct the respective Trustee how to vote the shares held for your
account by the ESOP and/or shares in the
<PAGE>
-2-
401(k) Stock Fund as of September 4, 1998, the record date for the Annual
Meeting (the "Record Date"), on the proposals to be voted by the Company's
shareholders. Your rights as a participant in the ESOP and/or 401(k) Plan will
vary depending on whether the matter being voted on is an "Anticipated Proposal"
or an "Unanticipated Proposal."
ANTICIPATED PROPOSALS.
ESOP PARTICIPANTS.
Each ESOP participant has the right to specify how the Trustee, as
Trustee for the ESOP, should vote the shares in his or her ESOP account as of
the Record Date. In general, the Trustee will vote the shares in your ESOP
account by casting votes on each proposal as you specify on the blue
Confidential Voting Instruction card accompanying this letter. The number of
shares in your ESOP account as of the Record Date are shown on the enclosed blue
Confidential Voting Instruction card.
The Trustee's fiduciary duties require it to vote any shares for which
it receives no voting instructions, as well as any shares not yet given to ESOP
participants, in a manner determined to be prudent and solely in the interest of
the participants and beneficiaries. If you do not direct the Trustee how to vote
the shares in your ESOP account, the Trustee will, to the extent consistent with
its fiduciary duties, vote your shares in a manner calculated to most accurately
reflect the instructions received from other participants in the ESOP. The same
is true of shares not yet placed in anyone's ESOP account.
If you do not have any shares allocated to your account in the ESOP as
of September 4, 1998, there will be no blue Confidential Voting Instruction card
for the ESOP enclosed with this letter.
401(K) STOCK FUND PARTICIPANTS.
In general, participants with investments in the 401(k) Stock Fund have
the right to direct how the Trustee should vote the shares that are held on the
participant's behalf in the 401(k) Stock Fund. In general, the Trustee will vote
FOR and AGAINST each proposal specified on the yellow Confidential Voting
Instruction card in the same proportions as instructions to cast votes FOR and
AGAINST such proposal are given by 401(k) Plan participants entitled to give
voting instructions. The instructions given by each 401(k) Plan participant will
be weighted according to value of his or her respective interest in the 401(k)
Stock Fund as of September 4, 1998. For purposes of the 401(k) Plan, if you
ABSTAIN as to a proposal, or if you do not return your yellow Confidential
Voting Instruction card for the 401(k) Plan to the Trustee by October 13, 1998,
your instructions will not be counted.
If you do not have any shares of Company common stock allocated to your
401(k) Plan account as of September 4, 1998, there will be no yellow
Confidential Voting Instruction card for the 401(k) Stock Fund enclosed with
this letter.
<PAGE>
-3-
UNANTICIPATED PROPOSALS.
It is possible, although very unlikely, that proposals other than those
specified on the Confidential Voting Instruction cards will be presented for
shareholder action at the 1998 Annual Meeting of Shareholders. If this should
happen, the Trustee of the ESOP and the Trustee of the 401(k) Stock Fund will
vote upon such matters in its discretion, or cause such matters to be voted upon
in the discretion of the individuals named in any proxies executed by it.
* * * * *
Your instruction is very important. You are encouraged to review the
enclosed material carefully and to complete, sign and date the enclosed
Confidential Voting Instruction card or cards to signify your direction to the
respective Trustee. YOU SHOULD THEN SEAL THE COMPLETED CARD OR CARDS IN THE
ENCLOSED ENVELOPE AND RETURN IT DIRECTLY TO THE RESPECTIVE TRUSTEE. The
Confidential Voting Instruction card or cards must be received by the Trustees
no later than October 13, 1998.
PLEASE NOTE THAT THE VOTING INSTRUCTIONS OF INDIVIDUAL PARTICIPANTS ARE
TO BE KEPT CONFIDENTIAL BY THE TRUSTEES, WHO HAVE BEEN INSTRUCTED NOT TO
DISCLOSE THEM TO ANYONE AT THE BANK OR THE COMPANY. IF YOU HAVE ANY QUESTIONS
REGARDING YOUR VOTING RIGHTS OR THE TERMS OF THE ESOP OR 401(K) PLAN, PLEASE
CALL MR. TIMOTHY L. MCCUE AT (847) 634-2100 .
Very truly yours,
THE MANAGEMENT SALARY COMPENSATION
COMMITTEE OF BIG FOOT FINANCIAL CORP.
Enclosures
<PAGE>
BIG FOOT FINANCIAL CORP.
CONFIDENTIAL VOTING INSTRUCTION
SOLICITED BY THE COMPENSATION COMMITTEE
OF BIG FOOT FINANCIAL CORP.
1997 RECOGNITION AND RETENTION PLAN
The undersigned participant of the Big Foot Financial Corp. 1997
Recognition and Retention Plan (the "RRP") hereby provides the voting
instructions specified to the trustee ("Trustee") of the RRP trust (the "RRP
Trust"), which instructions shall be taken into account by the Trustee in
voting, in person, by limited or general power of attorney, or by proxy, the
shares and fractional shares of common stock of Big Foot Financial Corp. that
are held by the Trustee, in its capacity as Trustee of the RRP, as of September
4, 1998, at the 1998 Annual Meeting of Shareholders of Big Foot Financial Corp.
to be held on October 20, 1998, and at any adjournment or postponement thereof.
As to the proposals listed on the reverse side, which are more
particularly described in the Proxy Statement dated September 10, 1998, the
Trustee will vote the common stock of Big Foot Financial Corp. held by the RRP
Trust to reflect the voting instructions on this Confidential Voting
Instruction, in the manner described in the accompanying letter from the
Management Salary Compensation Committee dated September 10, 1998.
(CONTINUED ON REVERSE SIDE. PLEASE COMPLETE, SIGN AND DATE ON THE
REVERSE SIDE AND PROMPTLY RETURN IN THE ENCLOSED POSTAGE-PAID ENVELOPE.)
<PAGE>
THE BOARD OF DIRECTORS OF BIG FOOT FINANCIAL CORP. RECOMMENDS A VOTE
"FOR" ALL NOMINEES IN PROPOSAL NO. 1 AND "FOR" PROPOSAL NO. 2. IF THIS
CONFIDENTIAL VOTING INSTRUCTION IS SIGNED BUT NO DIRECTION IS GIVEN, THIS VOTING
INSTRUCTION CARD WILL BE DEEMED TO INSTRUCT VOTES "FOR" ALL NOMINEES IN PROPOSAL
NO. 1 AND "FOR" PROPOSAL NO. 2. THE DIRECTIONS, IF ANY, GIVEN IN THIS
CONFIDENTIAL VOTING INSTRUCTION WILL BE KEPT CONFIDENTIAL FROM ALL DIRECTORS,
OFFICERS AND EMPLOYEES OF BIG FOOT FINANCIAL CORP. OR FAIRFIELD SAVINGS BANK,
F.S.B.
___________________________ ___________________________________________
Participant RRP Common Stock (as of September 4, 1998)
Please mark your votes like this
/X/
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
i. Election of two Directors for terms FOR both nominees WITHHOLD as to both nominees
of three years each. Nominees: (except as otherwise indicated) / /
Eugene W. Pilawski and Walter E. Powers / /
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE THAT NOMINEE'S NAME IN
THE SPACE PROVIDED:___________________________________________________________________
- ------------------------------------------------------------------------------------------------------------------------------------
FOR AGAINST ABSTAIN
ii. Ratification of the appointment of
KPMG Peat Marwick LLP as independent / / / / / /
auditors of Big Foot Financial Corp.
for the fiscal year ending June 30, 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
In its discretion, the Trustee is authorized to vote upon such other
business as may come before the Annual Meeting or any adjournment or
postponement thereof or to cause such matters to be voted upon in the discretion
of the individuals named in any proxies executed by the Trustees.
All proposals listed above in this Confidential Voting Instruction were
proposed by Big Foot Financial Corp.
The undersigned hereby instructs the Trustee to vote in accordance with
the voting instruction indicated above and hereby acknowledges receipt, prior to
the execution of this Confidential Voting Instruction, of a Voting Instruction
Letter, a Notice of Annual Meeting of Shareholders of Big Foot Financial Corp.,
a Proxy Statement dated September 10, 1998 for the Annual Meeting and a 1998
Annual Report to Shareholders.
PLEASE SIGN AND DATE BELOW AND RETURN PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE. YOUR CONFIDENTIAL VOTING INSTRUCTION MUST BE RECEIVED NO
LATER THAN OCTOBER 13, 1998.
DATE
---------------------------------------------
SIGNATURE
---------------------------------------------
Signature of participant, former participant
or designated beneficiary of deceased former
participant. Please sign name exactly as it
appears herein. When signing as attorney,
executor, administrator, trustee or guardian,
please give your full title as such.
<PAGE>
BIG FOOT FINANCIAL CORP.
CONFIDENTIAL VOTING INSTRUCTION
SOLICITED BY THE MANAGEMENT SALARY COMPENSATION COMMITTEE
OF BIG FOOT FINANCIAL CORP.
FOR THE EMPLOYEE STOCK OWNERSHIP PLAN
OF BIG FOOT FINANCIAL CORP.
The undersigned participant, former participant or beneficiary of a
deceased former participant in the Big Foot Financial Corp. Employee Stock
Ownership Plan (the "ESOP") hereby provides the voting instructions hereinafter
specified to the Trustee of the ESOP (the "Trustee"), which instructions shall
be taken into account by the Trustee in voting, in person, by limited or general
power of attorney, or by proxy, the shares and fractional shares of common stock
of Big Foot Financial Corp. that are held by the Trustee, in its capacity as
Trustee of the ESOP, as of September 4, 1998, at the 1998 Annual Meeting of
Shareholders of Big Foot Financial Corp. to be held on October 20, 1998, and at
any adjournment or postponement thereof.
As to the proposals listed on the reverse side, which are more
particularly described in the Proxy Statement dated September 10, 1998, the
Trustee will vote the common stock of Big Foot Financial Corp. held by the ESOP
Trust to reflect the voting instructions on this Confidential Voting
Instruction, in the manner described in the accompanying letter from the
Management Salary Compensation Committee dated September 10, 1998.
(CONTINUED ON REVERSE SIDE. PLEASE COMPLETE, SIGN AND DATE ON THE
REVERSE SIDE AND PROMPTLY RETURN IN THE ENCLOSED POSTAGE-PAID ENVELOPE.)
<PAGE>
THE BOARD OF DIRECTORS OF BIG FOOT FINANCIAL CORP. RECOMMENDS A VOTE
"FOR" ALL NOMINEES IN PROPOSAL NO. 1 AND "FOR" PROPOSAL NO. 2. IF THIS
CONFIDENTIAL VOTING INSTRUCTION IS SIGNED BUT NO DIRECTION IS GIVEN, THIS VOTING
INSTRUCTION CARD WILL BE DEEMED TO INSTRUCT VOTES "FOR" ALL NOMINEES IN PROPOSAL
NO. 1 AND "FOR" PROPOSAL NO. 2. THE DIRECTIONS, IF ANY, GIVEN IN THIS
CONFIDENTIAL VOTING INSTRUCTION WILL BE KEPT CONFIDENTIAL FROM ALL DIRECTORS,
OFFICERS AND EMPLOYEES OF BIG FOOT FINANCIAL CORP. OR FAIRFIELD SAVINGS BANK,
FSB.
___________________________ ___________________________________________
Participant ESOP Common Stock (as of September 4, 1998)
Please mark your votes like this
/X/
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Election of two Directors for terms FOR both nominees WITHHOLD as to both nominees
of three years each. Nominees: (except as otherwise indicated) / /
Eugene W. Pilawski, Walter E. Powers / /
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE THAT NOMINEE'S NAME IN
THE SPACE PROVIDED:___________________________________________________________________
- ------------------------------------------------------------------------------------------------------------------------------------
FOR AGAINST ABSTAIN
2. Ratification of the appointment of
KPMG Peat Marwick LLP as independent / / / / / /
auditors of Big Foot Financial Corp.
for the fiscal year ending June 30, 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
In its discretion, the Trustee is authorized to vote upon such other
business as may properly come before the Annual Meeting or any adjournment or
postponement thereof or to cause such matters to be voted upon in the discretion
of the individuals named in any proxies executed by the Trustees.
All proposals listed above in this Confidential Voting Instruction were
proposed by Big Foot Financial Corp.
The undersigned hereby instructs the Trustee to vote in accordance with
the voting instructions indicated above and hereby acknowledges receipt, prior
to the execution of the 1998 Annual Meeting of Shareholders of Big Foot
Financial Corp., a Proxy Statement dated September 10, 1998 for the 1998 Annual
Meeting and a 1998 Annual Report to Shareholders.
PLEASE SIGN AND DATE BELOW AND RETURN PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE. YOUR CONFIDENTIAL VOTING INSTRUCTION MUST BE RECEIVED NO
LATER THAN OCTOBER 13, 1998.
DATE
---------------------------------------------
SIGNATURE
---------------------------------------------
Signature of participant, former participant
or designated beneficiary of deceased former
participant. Please sign name exactly as it
appears herein. When signing as attorney,
executor, administrator, trustee or guardian,
please give your full title as such.
<PAGE>
BIG FOOT FINANCIAL CORP.
CONFIDENTIAL VOTING INSTRUCTION
SOLICITED BY THE MANAGEMENT SALARY COMPENSATION COMMITTEE
OF BIG FOOT FINANCIAL CORP.
FOR FAIRFIELD SAVINGS BANK PROFIT SHARING AND SAVINGS PLAN
The undersigned participant, former participant or beneficiary of a
deceased former participant in the Fairfield Savings Bank Profit Sharing and
Savings Plan (the "401(k) Plan") hereby provides the voting instructions
hereinafter specified to the Trustee of the 401(k) Plan (the "Trustee"), which
instructions shall be taken into account by the Trustee in voting, in person, by
limited or general power of attorney, or by proxy, the shares and fractional
shares of common stock of Big Foot Financial Corp. that are held by the Trustee,
in its capacity as Trustee of the 401(k) Plan, as of September 4, 1998, at the
1998 Annual Meeting of Shareholders of Big Foot Financial Corp. to be held on
October 20, 1998, and at any adjournment or postponement thereof.
As to the proposals listed on the reverse side, which are more
particularly described in the Proxy Statement dated September 10, 1998, the
Trustee will vote the common stock of Big Foot Financial Corp. held by the
401(k) Plan Trust to reflect the voting instructions on this Confidential Voting
Instruction, in the manner described in the accompanying letter from the
Management Salary Compensation Committee dated September 10, 1998.
(CONTINUED ON REVERSE SIDE. PLEASE COMPLETE, SIGN AND DATE ON THE
REVERSE SIDE AND PROMPTLY RETURN IN THE ENCLOSED POSTAGE-PAID ENVELOPE.)
<PAGE>
THE BOARD OF DIRECTORS OF BIG FOOT FINANCIAL CORP. RECOMMENDS A VOTE
"FOR" ALL NOMINEES IN PROPOSAL NO. 1 AND "FOR" PROPOSAL NO. 2. IF THIS
CONFIDENTIAL VOTING INSTRUCTION IS SIGNED BUT NO DIRECTION IS GIVEN, THIS VOTING
INSTRUCTION CARD WILL BE DEEMED TO INSTRUCT VOTES "FOR" ALL NOMINEES IN PROPOSAL
NO. 1 AND "FOR" PROPOSAL NO. 2. THE DIRECTIONS, IF ANY, GIVEN IN THIS
CONFIDENTIAL VOTING INSTRUCTION WILL BE KEPT CONFIDENTIAL FROM ALL DIRECTORS,
OFFICERS AND EMPLOYEES OF BIG FOOT FINANCIAL CORP. OR FAIRFIELD SAVINGS BANK,
FSB.
___________________________ ___________________________________________
Participant 401(k) Stock Fund Common Stock
(as of September 4, 1998)
Please mark your votes like this
/X/
<TABLE>
<CAPTION>
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<S> <C> <C>
1. Election of two Directors for terms FOR all nominees WITHHOLD as to all nominees
of three years each. Nominees: (except as otherwise indicated) / /
Eugene W. Pilawski and Walter E. Powers / /
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE THAT NOMINEE'S NAME IN
THE SPACE PROVIDED:___________________________________________________________________
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FOR AGAINST ABSTAIN*
2. Ratification of the appointment of
KPMG Peat Marwick LLP as independent / / / / / /
auditors of Big Foot Financial Corp.
for the fiscal year ending June 30, 1999.
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</TABLE>
* For purposes of your 401(k) Plan account, abstaining is the same as not
voting.
In its discretion, the Trustee is authorized to vote upon such other
business as may properly come before the Annual Meeting or any adjournment or
postponement thereof or to cause such matters to be voted upon in the discretion
of the individuals named in any proxies executed by the Trustees.
All proposals listed above in this Confidential Voting Instruction were
proposed by Big Foot Financial Corp.
The undersigned hereby instructs the Trustee to vote in accordance with
the voting instructions indicated above and hereby acknowledges receipt, prior
to the execution of this Confidential Voting Instruction, of a Voting
Instruction Letter, a Notice of the 1998 Annual Meeting of Shareholders of Big
Foot Financial Corp., a Proxy Statement dated September 10, 1998 for the 1998
Annual Meeting and a 1998 Annual Report to Shareholders.
PLEASE SIGN AND DATE BELOW AND RETURN PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE. YOUR CONFIDENTIAL VOTING INSTRUCTION MUST BE RECEIVED NO
LATER THAN OCTOBER 13, 1998.
DATE
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SIGNATURE
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Signature of participant, former participant
or designated beneficiary of deceased former
participant. Please sign name exactly as it
appears herein. When signing as attorney,
executor, administrator, trustee or guardian,
please give your full title as such.
