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.
/ / 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
[Letterhead of Big Foot Financial Corp.]
September 17, 1999
Dear Shareholder:
You are cordially invited to attend the 1999 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 19, 1999 at the Holiday Inn Mundelein,
located at 510 East Route 83, Mundelein, Illinois 60060 at 2:00 p.m., Central
Daylight Time.
The attached Notice of Annual Meeting and Proxy Statement describe the
formal business that we will transact at the Annual Meeting. In addition to the
formal items of business, management will report on the operations and
activities of the Company and the Bank, and you will have an opportunity to ask
questions. We also expect representatives of the accounting firm of KPMG LLP to
be present at the Annual Meeting to respond to 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 CANNOT 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'S COMMON STOCK.
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 1999 ANNUAL MEETING OF SHAREHOLDERS
DATE: TUESDAY, OCTOBER 19, 1999
TIME: 2:00 P.M., CENTRAL DAYLIGHT TIME
PLACE: HOLIDAY INN MUNDELEIN
510 EAST ROUTE 83
MUNDELEIN, ILLINOIS 60060
At our 1999 Annual Meeting, we will ask you to:
o Elect one candidate to serve as a director for a three-year
term expiring at the 2002 annual meeting;
o Ratify the appointment of KPMG LLP as independent public
accountants for the fiscal year ending June 30, 2000; and
o Transact any other business as may properly come before the
Annual Meeting.
You may vote at the Annual Meeting and at any adjournment or
postponement thereof if you were a shareholder of the Company at the close of
business on September 3, 1999, the record date.
By Order of the Board of Directors,
/s/ Barbara J. Urban
--------------------
Barbara J. Urban
SECRETARY
Long Grove, Illinois
September 17, 1999
================================================================================
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>
PROXY STATEMENT FOR THE BIG FOOT FINANCIAL CORP.
1999 ANNUAL MEETING OF SHAREHOLDERS
INFORMATION ABOUT THE ANNUAL MEETING AND VOTING
WHY WE SENT YOU THIS PROXY STATEMENT
We have sent to the shareholders of Big Foot Financial Corp. (the
"Company") this Proxy Statement and enclosed proxy card because the Board of
Directors of the Company is soliciting your proxy to vote at the Annual Meeting.
You do not need to attend the Annual Meeting to vote your shares. You may simply
complete, sign and return the enclosed proxy card, and your votes will be cast
for you at the Annual Meeting. This process is described below in the section
entitled "Voting Rights."
We began mailing this Proxy Statement, the Notice of Annual Meeting and
the enclosed proxy card on or about September 17, 1999 to all shareholders
entitled to vote. If you owned shares of the Company's common stock at the close
of business on September 3, 1999, the record date, you are entitled to vote at
the Annual Meeting. On the record date, there were 2,255,949 shares of common
stock issued and outstanding.
QUORUM
A quorum of shareholders is necessary to hold a valid meeting. 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 entitled to vote at the Annual Meeting
is necessary to constitute a quorum.
VOTING RIGHTS
You are entitled to one vote at the Annual Meeting for each share of
the Company's common stock that you owned at the close of business on September
3, 1999. Our Articles of Incorporation provide restrictions on the voting of our
common stock if you beneficially own more than 10% of our outstanding common
stock. The number of shares you own (and may vote) is listed on the enclosed
proxy card.
You may vote your shares at the Annual Meeting in person or by proxy.
To vote in person, you must attend the Annual Meeting and obtain and submit a
ballot, which we will provide to you at the Annual Meeting. To vote by proxy,
you must complete, sign and return the enclosed proxy card. If you properly
complete and sign your proxy card and send it to us in time to vote, your
"proxy" (ONE OF THE INDIVIDUALS NAMED ON YOUR PROXY CARD) will vote your shares
as you have directed. IF YOU SIGN THE PROXY CARD BUT DO NOT SPECIFY HOW YOU WANT
TO VOTE YOUR SHARES, YOUR PROXY WILL VOTE YOUR SHARES FOR THE ELECTION OF THE
NOMINEE FOR DIRECTOR AND FOR THE RATIFICATION OF THE APPOINTMENT OF THE
COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS.
If any other matters are presented, your proxy will vote the shares
represented by all properly executed proxies on such matters as a majority of
the Board of Directors determines. As of the date of this Proxy Statement, we
know of no other matters that may be presented at the Annual Meeting, other than
those discussed in this Proxy Statement.
<PAGE>
VOTE REQUIRED
PROPOSAL 1: Directors are elected by a plurality vote.
Elect One Director Because there is only one nominee for director,
he will be elected if there are more votes
"for" than votes "against." So, if you do not
vote for the nominee, or you indicate "withhold
authority" on your proxy card, your vote will
not count "for" or "against" the nominee.
PROPOSAL 2: The affirmative vote of a majority of the
Ratify Appointment shares present in person or by proxy at the
of Independent Annual Meeting and entitled to vote on this
Public Accountants proposal is required to ratify the appointment
of KPMG LLP as the Company's independent public
accountants. So, if you "abstain" from voting,
it will have the same effect as if you voted
"against" this proposal.
EFFECT OF BROKER NON-VOTES
If your broker holds shares that you own in "street name," the broker
may vote your shares on the two proposals listed above even if the broker does
not receive instructions from you. If your broker does not vote on Proposal 1 or
2, this will constitute a "broker non-vote." A broker non-vote will not be
counted as having voted in person or by proxy and will have no effect on the
outcome of the election of a director or the ratification of the appointment of
our independent public accountants.
CONFIDENTIAL VOTING POLICY
We maintain a policy of keeping shareholder votes confidential. We only
let our Inspector of Election, Harris Trust and Savings Bank, examine the voting
materials. We will not disclose your vote to management unless it is necessary
to meet legal requirements. We will, however, forward any written comments that
you may have to management.
REVOKING YOUR PROXY
You may revoke your proxy at any time before it is actually voted at
the Annual Meeting by:
o Filing with the Secretary of the Company a letter revoking the
proxy;
o Submitting another signed proxy with a later date; or
o Attending the Annual Meeting and voting in person, provided you
file a written revocation with the Secretary of the Annual
Meeting prior to voting.
IF YOUR SHARES ARE NOT REGISTERED IN YOUR OWN NAME, YOU WILL NEED
APPROPRIATE DOCUMENTATION FROM YOUR RECORD HOLDER TO VOTE PERSONALLY AT THE
ANNUAL MEETING. Examples of such documentation include a broker's statement,
letter or other document that will confirm your ownership of shares of the
Company's common stock.
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<PAGE>
SOLICITATION OF PROXIES
The Company will pay the costs of soliciting proxies from its
shareholders. Directors, officers or employees of the Company and the Bank may
solicit proxies by:
o mail;
o telephone; and
o other forms of communication.
We will reimburse banks, brokers, nominees and other fiduciaries for
the expenses they incur in forwarding the proxy materials to you. In addition,
we have hired Morrow & Co. to assist in the solicitation
of proxies for a fee of $3,000, plus reimbursement of expenses.
OBTAINING AN ANNUAL REPORT ON FORM 10-K
If you would like a copy of our Annual Report on Form 10-K for the year
ended June 30, 1999, which we will file with the SEC, we will send you one
(without exhibits) free of charge. Please write to:
Timothy L. McCue
Senior Vice President and Chief Financial Officer
Big Foot Financial Corp.
1190 RFD
Long Grove, Illinois 60047-7304
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<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
PRINCIPAL SHAREHOLDERS OF THE COMPANY
The following table shows certain information for persons who we know
"beneficially owned" 5% or more of our common stock as of July 31, 1999. In
general, beneficial ownership includes those shares over which a person has
voting or investment power. In this proxy statement, "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 shares. Beneficial ownership also
includes the number of shares that a person has the right to acquire within 60
days (such as through the exercise of stock options) after July 31, 1999. We
obtained the information provided in the following table from filings with the
SEC and with the Company.
<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. Employee 200,367(2) 8.8%
value $.01 per share Stock Ownership Plan Trust
Old McHenry Road and Route 83
Long Grove, Illinois 60047
Common Stock, par Wellington Management Company, LLP 125,000(3) 5.5%
value $.01 per share 75 State Street
Boston, MA 02109
</TABLE>
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(1) The total number of shares of common stock outstanding on July 31, 1999 was
2,270,949 shares.
(2) A Plan Administrator, who is an employee of the Company appointed by the
Board of Directors, administers the ESOP. 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 July 31, 1999, 49,602 shares had been
allocated to current participants, and 150,765 shares 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) Based on a Schedule 13G filed with the SEC on February 8, 1999, these
shares of common stock are owned by Wellington Management Company, LLP in
its capacity as an investment advisor for First Financial Fund, Inc., an
investment company registered under Section 8 of the Investment Company
Act.
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<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table shows the number of shares of our common stock
beneficially owned by each director and named executive officer identified in
the Summary Compensation Table included elsewhere in this proxy statement, and
all directors and executive officers of the Company as a group, as of July 31,
1999. 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 owned by such person or group.
<TABLE>
<CAPTION>
AMOUNT AND PERCENT OF
NATURE OF COMMON
BENEFICIAL STOCK
NAME TITLE (1) OWNERSHIP(2) OUTSTANDING(3)
- ---- --------- ------------ --------------
<S> <C> <C> <C>
George M. Briody (4) President and Director 78,416 (5)(6)(7) 3.4%
F. Gregory Opelka (8) Executive Vice President and 58,774 (5)(6)(7) 2.6%
Director
Eugene W. Pilawski (9) Director 28,690 (5)(7) 1.3%
Stephen E. Nelson Director 6,397 (5)(7) *
Joseph J. Nimrod (10) Director 43,390 (5)(7) 1.9%
Walter E. Powers, M.D. (11) Director 18,103 (5)(7) *
Timothy L. McCue (12) Senior Vice President and 47,890 (5)(6)(7) 2.1%
Chief Financial Officer
All directors and executive 510,969 (5)(6)(7) 21.6%
officers as a group
(10 persons)(13)
</TABLE>
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* 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 the definition of
"beneficial ownership."
(3) Percentages with respect to each person or group of persons have been
calculated on the basis of 2,270,949 shares of common stock, the total
number of shares of common stock outstanding as of July 31, 1999, plus
the number of shares of common stock which such person or group has the
right to acquire within 60 days after July 31, 1999, by the exercise of
stock options.
(4) Includes 6,751 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.
(5) Includes restricted stock awards of 2,814 shares of common stock made
to each of Messrs. Nelson, Pilawski, Nimrod and Powers under the Big
Foot Financial Corp. 1997 Recognition and Retention Plan (the "RRP").
Also includes restricted stock awards of 13,465, 11,015 and 11,015
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.
(6) The figures shown above include shares held in trust pursuant to the
ESOP that have been allocated to individual accounts as follows: Mr.
Briody, 5,192 shares; Mr. Opelka, 3,368 shares; Mr. McCue, 3,032
shares; and executive officers as a group, 17,520 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.
(7) Includes 4,020 shares of common stock that may be acquired by each of
Messrs. Pilawski, Nimrod and Powers and 838 shares of common stock that
may be acquired by Mr. Nelson pursuant to vested 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
22,112, 15,076, and 15,076 shares of common stock that may be acquired
by Messrs. Briody, Opelka and McCue, respectively, under the Stock
Option Plan.
(FOOTNOTES CONTINUED ON FOLLOWING PAGE)
- 5 -
<PAGE>
(8) Includes 6,000 shares held by Mr. Opelka's spouse and 3,593 shares held
by his son. Mr. Opelka disclaims beneficial ownership of the shares
held by his spouse and son.
(9) Includes 5,650 shares held by Mr. Pilawski's spouse of which Mr.
Pilawski disclaims beneficial ownership.
(10) Includes 11,200 shares held by a corporation of which Mr. Nimrod is a
controlling shareholder and 3,950 shares held by his spouse. Mr. Nimrod
disclaims beneficial ownership of the 3,950 shares held by his spouse.
(11) Includes 2,899 shares held by Dr. Powers' spouse of which Dr. Powers
disclaims beneficial ownership.
(12) 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.
(13) The amount of shares for all directors and executive officers as a
group includes 150,765 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, 1999. The individual
participants in the ESOP have shared voting power with the ESOP
Trustee. The amount of shares for all directors and executive officers
as a group also includes 73,630 shares held by the RRP trust, over
which certain executive officers may be deemed to have shared
investment power.
DISCUSSION OF PROPOSALS RECOMMENDED BY THE BOARD
-----------------------------------------------------------------
PROPOSAL 1
ELECTION OF DIRECTOR
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GENERAL
The Company's Articles of Incorporation provide that the Board of
Directors shall be divided into three classes with respect to term of office, as
nearly equal in number as possible with the terms of one class expiring at each
annual meeting. At each annual meeting of shareholders, the successors to the
class of directors whose term expires are elected by the shareholders to serve
for a term of three years. The Company's Board of Directors currently consists
of six members. The Board of Directors appointed Mr. Stephen E. Nelson to the
Board in February, 1999 to fill a vacancy created by the death of Mr. Maurice
Leahy. Mr. Nelson was also nominated in July, 1999 to stand for election as a
director at the 1999 Annual Meeting for a three-year term to expire in 2002.
Each of our directors also serves as a director of the Bank.
If you elect Mr. Nelson, he will hold office until the Annual Meeting
in 2002, or until his successor has been duly elected and qualified. Mr. Nelson
has consented to being named in this proxy statement and to serve if elected. We
know of no reason why Mr. Nelson may be unable to serve as a director. If he is
unable to serve, your proxy may vote for another nominee proposed by the Board.
If for any reason this nominee is unable or unwilling to stand for election, the
Board will nominate an alternate or reduce the size of the Board of Directors to
eliminate the vacancy. The Board must notify the Secretary of the Company in
writing of the alternate proposed nominee no fewer than five (5) days prior to
the date of the Annual Meeting.
================================================================================
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
A VOTE "FOR" THE NOMINEE FOR ELECTION AS A DIRECTOR.
================================================================================
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<PAGE>
INFORMATION AS TO THE NOMINEE AND CONTINUING DIRECTORS
<TABLE>
<CAPTION>
POSITIONS HELD WITH DIRECTOR TERM
NOMINEE AGE(1) THE COMPANY SINCE(2) EXPIRES
- ------- ------ ----------------------------- ---------- -------
<S> <C> <C> <C>
Stephen E. Nelson................. 30 Director 1999 2002
CONTINUING DIRECTORS
George M. Briody.................. 72 President, Director 1951 2000
Joseph J. Nimrod.................. 70 Director 1978 2000
F. Gregory Opelka................. 71 Executive Vice 1972 2000
President, Director
Eugene W. Pilawski................ 76 Director 1990 2001
Walter E. Powers, M.D............. 71 Director 1977 2001
</TABLE>
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(1) At June 30, 1999.
(2) Includes terms as a director of Fairfield Savings Bank, F.S.B.
The principal occupation and business experience of the nominee for
election as director and each Continuing Director is set forth below. Positions
held by a director or executive officer have been held for
at least the past five years unless stated otherwise.
NOMINEE FOR ELECTION AS DIRECTOR
STEPHEN E. NELSON has served as a director of the Bank and the Company
since February, 1999. Mr. Nelson has been employed by the investment firm of
Hovde Financial, Inc. for the past five years. Mr. Nelson is a Vice President
and specializes in advising Midwestern financial institutions on their
respective strategic and financial needs. In this capacity, he is actively
involved in structuring and negotiating mergers and acquisitions on their
behalf, advising on branch acquisitions and divestitures and recommending
capital raising alternatives to tailor specific strategic and financial needs.
Mr. Nelson, as an employee of Hovde Financial, Inc., was also involved in our
conversion to stock form in December, 1996.
CONTINUING DIRECTORS
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.
- 7 -
<PAGE>
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.
EUGENE W. PILAWSKI joined the Bank in 1949 and serves as a director of
the Bank and the Company since 1990. 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. 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 Medical Society, American College of Radiology, Radiology Society of
North America and Illinois Radiology Society. Dr. Powers and Mr. Pilawski are
brothers.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS OF THE COMPANY AND THE BANK
The Board of Directors oversees our business and monitors the
performance of our management. In accordance with our corporate governance
procedures, the Board of Directors does not involve itself in our day-to-day
operations, which is overseen by our executive officers and management. Our
directors attend regular meetings of the Board which are generally held on a
monthly basis. Our directors also discuss matters relating to the business of
the Company and the Bank with the President and Chief Executive Officer, other
key executives, and our principal external advisers (legal counsel, independent
public accountants, financial advisors and other consultants).
The Board of Directors held nine regular meetings during the fiscal
year ended June 30, 1999. Each incumbent director attended at least 75% of the
meetings of the Board of Directors and meetings of the
committees on which that particular director served during this period.
The Company and the Bank have established the following committees of
each of their respective Boards of Directors:
AUDIT The Audit Committee meets periodically with the
Company's independent COMMITTEE 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.
Directors Nimrod and Powers serve as members of
the committee.
The Audit Committee met once in the 1999 fiscal
year.
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<PAGE>
MANAGEMENT The committee reviews and makes recommendations
SALARY to their respective Board of Directors
COMPENSATION regarding the compensation of executive
COMMITTEE officers of the Company and the Bank.
Directors Powers, Pilawski and Nimrod serve as
members of the committee.
The Compensation Committee met once in the 1999
fiscal year.
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 Senior 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 Board of Directors elects the executive officers of the Company,
annually. The elected officers 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 its
executive officers which set forth the terms of their employment. See
"--Employment Agreements.
Biographical information of executive officers who are not directors is
set forth below.
TIMOTHY L. MCCUE, age 54, has served as the Bank's Senior Vice
President, Chief Financial Officer since July 1999 and as 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 is the
Vice Chairman for the Financial Managers Society.
ROBERT JONES, age 56, has served as the Bank's Vice President, Chief
Savings Officer since April 1987. MICHAEL CAHILL, age 45, has served as Vice
President, Controller of the Bank since 1986.
JEROME A. MAHER, age 64, 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.
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<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,
1999, 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, 1999. 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 and stock 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, 1999, 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, on average, not increased 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, 1999 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.
- 10 -
<PAGE>
The determination of the Chief Executive Officer's compensation for the
fiscal year ended June 30, 1999 was based on the same general principles applied
to other executive officers and resulted in a $12,000 reduction in base salary,
with no cash incentive payment.
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
EUGENE W. PILAWSKI, MEMBER
WALTER E. POWERS, MEMBER
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the fiscal year ended June 30, 1999, the Management Salary
Compensation Committee consisted of Messrs. Powers, Pilawski and Nimrod. During
the 1999 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.
- 11 -
<PAGE>
PERFORMANCE GRAPH
The following graph compares the Company's total cumulative shareholder
return from December 20, 1996, the date following the Company's initial public
offering, to June 30, 1999, to the total return for the Nasdaq Stock Market
(U.S.) and the total return for the Nasdaq Bank Index.
[GRAPHIC OMITTED]
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
12/20/96 12/31/96 6/30/97 12/31/97 6/30/98 12/31/98 6/30/99
-------- -------- ------- -------- ------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Big Foot Financial Corp.......... $100 $130 $161 $210 $180 $143 $150
Nasdaq Stock
Market (U.S.)................. 100 100 112 123 148 173 211
Nasdaq Bank Index................ 100 101 126 169 175 168 173
*Assumes $100 invested on December 20, 1996.
Assumes dividends reinvested.
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
THERE CAN BE NO ASSURANCE THAT STOCK PERFORMANCE WILL CONTINUE INTO THE FUTURE
WITH THE SAME OR SIMILAR TRENDS DEPICTED IN THE GRAPH ABOVE.
- 12 -
<PAGE>
DIRECTORS' COMPENSATION
FEE ARRANGEMENTS. Currently, each director of the Bank receives a
monthly fee of $1,100. The total of fees paid to the directors by the Bank for
the fiscal year ended June 30, 1999 was approximately $84,150. 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 Stock Option Plan and restricted stock awards under the Company's
Recognition and Retention Plan. For descriptions of these plans and awards
granted under such plans, see "--Benefits -- Stock Option Plan" and "-- Benefits
- -- Recognition and Retention Plan."
EXECUTIVE COMPENSATION
COMPENSATION DECISIONS. The Bank pays substantially all of the
compensation of the executive officers of the Bank and the Company. The Bank's
Board of Directors makes decisions regarding executive compensation based on
recommendations of the Bank Management Salary Compensation Committee.
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, 1999, to the Chief Executive Officer and all
executive officers of the Company 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)
--------- ---- ------ ----- --- --- --- --- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C>
George M. Briody,
President................ 1999 $156,100 $15,990 -- -- -- -- $31,048
1998 $167,340 $15,548 -- $370,274 -- -- $39,557
1997 $147,840 $14,888 -- -- 55,280 -- $25,384
F. Gregory Opelka,
Executive
Vice President........... 1999 $112,200 $10,400 -- -- -- -- $21,555
1998 $111,745 $10,095 -- $302,899 -- -- $25,101
1997 $ 97,850 $ 9,485 -- -- 37,693 -- $16,153
Timothy L McCue, Senior
Vice President and Chief
Financial Officer........ 1999 $106,800 $ 9,200 -- -- -- -- $20,394
1998 $ 99,784 $ 8,941 -- $302,899 -- -- $21,789
1997 $ 87,276 $ 8,351 -- -- 37,691 -- $14,136
</TABLE>
- --------------
(1) Under Annual Compensation, the column titled "Salary" includes base
salary, director's and/or management fees and payroll deductions for
health insurance under the Bank's health insurance plan for the fiscal
years ended June 30, 1999, 1998 and 1997.
(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) 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
(FOOTNOTES CONTINUED ON FOLLOWING PAGE)
- 13 -
<PAGE>
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, multiplied by the total shares granted to the named executive
officer. The aggregate fair market value of the unvested restricted
stock awards made to Messrs. Briody, Opelka and McCue were $201,975,
$165,225 and $165,225, respectively, on June 30, 1999, based on a
closing price of $15.00 per share. 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.
(4) Includes (a) employer contributions to the 401(k) Plan for 1999, 1998
and 1997 as follows: Mr. Briody, $1,663, $1,685, and $7,566; Mr.
Opelka, $1,485, $1,485, and $4,817; and Mr. McCue, $1,404, $1,305, and
$4,219; and (b) allocations of common stock under the ESOP (valued
using a price per share of $15.00, $18.00 and $16.125, the closing
sales price for shares of common stock on The Nasdaq Stock Market on
June 30, 1999, 1998 and 1997, respectively) for 1999, 1998 and 1997 as
follows: Mr. Briody, $29,385, $37,872 and $17,818; Mr. Opelka, $20,070,
$23,616 and $11,336; and Mr. McCue, $18,990, $20,484 and $9,917.
EMPLOYMENT AGREEMENTS
The Company and the Bank entered into Employment Agreements with each
of Messrs. Briody, Opelka, McCue, Jones, and Cahill effective December 19, 1996,
and with Mr. Maher effective October 20, 1998 (collectively, 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
- 14 -
<PAGE>
or responsibility, any reduction in any element of compensation or benefits, any
adverse 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.
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
- 15 -
<PAGE>
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, 1999, the annual compensation
for calculating benefits may not exceed $160,000 (as adjusted for
subsequent years pursuant to Code provisions).
(2) For the Pension Plan year ended July 31, 1999, 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, 1999, the end of the 1999 plan year, for each
of the individuals named in the Summary Compensation Table.
YEARS OF CREDITED SERVICE
------------------------- FINAL AVERAGE
YEARS MONTHS COMPENSATION
----- ------ ------------
Mr. Briody.................... 49 0 $147,532
Mr. Opelka.................... 44 7 95,238
Mr. McCue..................... 14 6 84,964
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 1999), or to a limit imposed under the Code
($10,000 for fiscal 1999). 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 our common stock issued in our conversion to
stock form. Although contributions to the ESOP are
- 16 -
<PAGE>
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 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 Company's Board of Directors adopted the Stock
Option Plan and the Company's shareholders approved it at a special meeting 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 maximum aggregate number of shares of common
stock available for issuance upon the exercise of stock options granted under
the Stock Option Plan is 258,143.
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
- 17 -
<PAGE>
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. Mr.
Stephen E. Nelson, a director appointed on February 23, 1999 and a nominee for
election as a director, was granted a non-qualified stock option to purchase an
aggregate of 6,868 shares of common stock at an exercise price of $12.8125 per
share which vests as follows: 838 shares at June 24, 1999 and 2,010 shares at
June 24, 2000, 2001, and 2002.
All stock options granted under the Plan generally vest in 20%
increments over a five year period, subject to full vesting upon the optionee's
death, disability, retirement or upon a change in control of the Company, as
defined in the Stock Option Plan, beginning June 24, 1998. The Company believes
the use of a vesting schedule will encourage each Option recipient to remain in
the service of the Company (or an affiliate) and contribute to its profitability
in order to enjoy the full economic benefit of the Option. The Company has
reserved the right to amend or terminate the Plan, in whole or in part, subject
to the requirements of all applicable laws.
The following table provides certain information with respect to the
number of shares of common stock acquired through the exercise of, or
represented by, outstanding stock options held by the Named Executive Officers
on June 30, 1999.
<TABLE>
<CAPTION>
FISCAL YEAR END OPTIONS/SAR VALUES
NUMBER OF SECURITIES VALUE OF UNEXCERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES VALUE OPTIONS/SARS AT FISCAL OPTIONS/SARS AT FISCAL
ACQUIRED ON REALIZED ON YEAR-END YEAR-END
EXERCISE EXERCISE (#) ($)
NAME (#) (1) ($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE (2)
---- ------- --- ------------------------- -----------------------------
<S> <C> <C> <C> <C>
George M. Briody -- -- 22,112/33,168 N/A
F. Gregory Opelka -- -- 15,076/22,617 N/A
Timothy L. McCue -- -- 15,076/22,615 N/A
</TABLE>
- --------------
(1) None of the Named Executive Officers exercised options during the
fiscal year ended June 30, 1999.
(2) Of the total outstanding stock options held by Mr. Briody, Mr. Opelka
and Mr. McCue, all of the unexercisable options are "out-of-the-money"
options at June 30, 1999, i.e., the exercise price of the options was
greater than the closing price of the Company's common stock at June
30, 1999.
The Shares reserved for issuance upon exercise of options 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 Board of Directors of the Company
adopted the RRP and it was 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 106,929 shares of Common stock ("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
- 18 -
<PAGE>
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.
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,
1999, each outside director, Messrs. Pilawski, Nimrod and Powers, has been
granted a Restricted Stock Award with respect to 4,020 shares of Common stock.
As of July 31, 1999, outside director Mr. Nelson has been granted a Restricted
Stock Award with respect to 3,149 shares of common stock which vests as follows:
335 shares at June 30, 1999; 804 shares at June 30, 2000, 2001 and 2002; and 402
shares at June 30, 2003. All outstanding Restricted Stock Awards to eligible
directors (with the exception of Mr. Nelson) and eligible employees will vest
and become distributable at the rate of 10% at June 30, 1999, 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
Under applicable federal law, 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 $438,000 or 1.3%
of the Company's shareholders' equity at June 30, 1999.
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) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires that the
Company's directors and executive officers, and any person holding more than ten
percent of the Company's common stock, file with the SEC reports of ownership
and changes in ownership, and that such individuals furnish the Company with
copies of the reports.
Based solely on our review of the copies of such reports that we have
received, or written representations from certain reporting persons, we believe
that all of our executive officers and directors complied with all Section 16(a)
filing requirements applicable to them.
- 19 -
<PAGE>
-----------------------------------------------------------------
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------------------------------
The Board of Directors has appointed KPMG LLP as our independent public
accountants for the fiscal year ending June 30, 2000, and we are asking
shareholders to ratify the appointment. We expect representatives of KPMG LLP to
attend the Annual Meeting and to 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 LLP's appointment.
================================================================================
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF KPMG LLP
AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE COMPANY.
================================================================================
ADDITIONAL INFORMATION
INFORMATION ABOUT SHAREHOLDER PROPOSALS
Under the proxy solicitation regulations of the SEC, if you wish to
submit a proposal to be included in our proxy statement for the 2000 Annual
Meeting, we must receive it by May 20, 2000. SEC rules contain standards as to
whether shareholder proposals are required to be included in the proxy
statement. Any such proposal will be subject to 17 C.F.R. ss. 240.14a-8 of the
rules and regulations promulgated by the SEC.
In addition, under the Company's Bylaws, if you wish to nominate a
director or bring other business before an annual meeting:
o You must be a shareholder of record and have given timely notice
in writing to the Secretary of the Company; and
o Your notice must contain specific information required in our
Bylaws.
By Order of the Board of Directors,
/s/ Barbara J. Urban
--------------------
Barbara J. Urban
SECRETARY
Long Grove, Illinois
September 17, 1999
================================================================================
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 19, 1999.
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 3, 1999, at the Annual Meeting of Shareholders (the
"Annual Meeting") to be held at 2:00 p.m., Central Time, on October 19, 1999, 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 THE NOMINEE 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. / /
The Board of Directors unanimously recommends a vote "FOR" the nominee named in
Item 1 and a vote "FOR" the proposal in Item 2.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1. Election of one Director for a term of FOR WITHHOLD AUTHORITY 2. Ratification of the appointment of FOR AGAINST ABSTAIN
three years. KPMG LLP as independent auditors
NOMINEE: Stephen E. Nelson / / / / for the fiscal year ending
June 30, 2000. / / / / / /
</TABLE>
I will attend the Annual Meeting.
The undersigned hereby acknowledges receipt of the Notice of
the 1999 Annual Meeting of Shareholders and the Proxy
Statement for the Annual Meeting.
-----------------------------------------------------------
-----------------------------------------------------------
Signature(s)
Dated:____________________________________________ , 1999
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 17, 1999
TO: ALL RECOGNITION AND RETENTION PLAN ("RRP") PARTICIPANTS
Re: Annual Meeting of Shareholders to be held on October 19, 1999
-------------------------------------------------------------
Dear Participants:
As you know, Big Foot Financial Corp. ("Company") 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 which 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 the 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 19, 1999 ("Annual Meeting"). In connection
therewith, enclosed are the following documents:
1. RRP Confidential Voting Instruction Form;
2. Proxy Statement for the 1999 Annual Meeting, dated September
17, 1999 including a Notice of the 1999 Annual Meeting of
Shareholders; and
3. 1999 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 3, 1999. 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 12, 1999. 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>
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
3, 1999, at the 1999 Annual Meeting of Shareholders of Big Foot Financial Corp.
to be held on October 19, 1999, 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 17, 1999, 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 17, 1999.
(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" THE NOMINEE 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" THE NOMINEE 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 3, 1999)
Please mark your votes like this
/X/
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Election of one Director for a term of three years each. Nominee: Stephen E. Nelson FOR WITHHOLD AUTHORITY
/ / / /
- ------------------------------------------------------------------------------------------------------------------------------------
2. Ratification of the appointment of KPMG LLP as independent public accountants of FOR AGAINST ABSTAIN
Big Foot Financial Corp. for the fiscal year ending June 30, 2000. / / / / / /
- ------------------------------------------------------------------------------------------------------------------------------------
</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 17, 1999 for the Annual Meeting and
a 1999 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 12, 1999.
------------------------------------------------------------
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>
[Letterhead of Big Foot Financial Corp.]
September 17, 1999
TO: ALL EMPLOYEE STOCK OWNERSHIP PLAN
AND 401(K) SAVINGS PLAN PARTICIPANTS
Re: Annual Meeting of Shareholders to be held on October 19, 1999
-------------------------------------------------------------
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 19, 1999, 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 1999 Annual Meeting dated September 17,
1999, including a Notice of the 1999 Annual Meeting of
Shareholders; and
4. 1999 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 3, 1999, 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 3, 1999, 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 3, 1999. 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 12, 1999,
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 3, 1999, 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 1999 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 12, 1999.
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 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 3, 1999, at the 1999 Annual Meeting of
Shareholders of Big Foot Financial Corp. to be held on October 19, 1999, 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 17, 1999, 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 17, 1999.
(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" THE NOMINEE 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" THE NOMINEE 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 3, 1999)
Please mark your votes like this
/X/
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Election of one Director for a term of three years. Nominee: Stephen E. Nelson FOR WITHHOLD AUTHORITY
/ / / /
- ------------------------------------------------------------------------------------------------------------------------------------
2. Ratification of the appointment of KPMG LLP as independent public accountants of FOR AGAINST ABSTAIN
Big Foot Financial Corp. for the fiscal year ending June 30, 2000. / / / / / /
- ------------------------------------------------------------------------------------------------------------------------------------
</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 Trustee.
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 1999 Annual Meeting of Shareholders of Big
Foot Financial Corp., a Proxy Statement dated September 17, 1999 for the 1999
Annual Meeting and a 1999 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 12, 1999.
------------------------------------------------------------
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 3, 1999, at the
1999 Annual Meeting of Shareholders of Big Foot Financial Corp. to be held on
October 19, 1999, 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 17, 1999, 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 17, 1999.
(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" THE NOMINEE 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" THE NOMINEE 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 3, 1999)
Please mark your votes like this
/X/
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Election of one Director for a term of three years. Nominee: Stephen E. Nelson FOR WITHHOLD AUTHORITY
/ / / /
- ------------------------------------------------------------------------------------------------------------------------------------
2. Ratification of the appointment of KPMG LLP, as independent public accountants FOR AGAINST ABSTAIN*
of Big Foot Financial Corp. for the fiscal year ending June 30, 2000. / / / / / /
- ------------------------------------------------------------------------------------------------------------------------------------
</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 Trustee.
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 1999 Annual Meeting of Shareholders of Big
Foot Financial Corp., a Proxy Statement dated September 17, 1999 for the 1999
Annual Meeting and a 1999 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 12, 1999.
------------------------------------------------------------
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.
