[Letterhead of Wayne Savings Bancshares, Inc.]
June 25, 1998
Dear Stockholder:
We cordially invite you to attend the 1998 Annual Meeting of
Stockholders of Wayne Savings Bancshares, Inc. (the "Company").
The Annual Meeting will be held at the Black Tie Affair
Conference Center, 50 Riffel Road, Wooster, Ohio, at 10:00 a.m.,
Ohio time, on July 23, 1998.
The enclosed Notice of Annual Meeting and Proxy Statement
describe the formal business to be transacted. During the
meeting we will also report on the operations of the Company.
Directors and officers of the Company, as well as a
representative of our independent auditors, will be present to
respond to any questions that stockholders may have.
At the Annual Meeting, stockholders will be requested to (i)
elect three directors of the Company and (ii) ratify the
appointment of Grant Thornton LLP as auditors for the Company's
fiscal year ending March 31, 1999.
The Board of Directors of the Company has determined that the
matters to be considered at the Annual Meeting are in the best
interest of the Company and its stockholders. For the reasons
set forth in the Proxy Statement, the Board of Directors
unanimously recommends a vote "FOR" each matter to be considered.
Also enclosed for your review is our 1998 Annual Report to
Stockholders, which contains detailed information concerning the
activities and operating performance of the Company. On behalf
of the Board of Directors, we urge you to sign, date and return
the enclosed proxy card as soon as possible even if you currently
plan to attend the Annual Meeting. This will not prevent you
from voting in person, but will assure that your vote is counted
if you are unable to attend the meeting.
Sincerely,
/s/ Charles F. Finn
Charles F. Finn
Chairman, President and Chief Executive Officer
<PAGE>
WAYNE SAVINGS BANCSHARES, INC.
151 North Market Street
Wooster, Ohio 44691
(330) 264-5767
NOTICE OF
1998 ANNUAL MEETING OF STOCKHOLDERS
To Be Held On July 23, 1998
Notice is hereby given that the 1998 Annual Meeting of Wayne
Savings Bancshares, Inc. (the "Company") will be held at the
Black Tie Affair Conference Center, 50 Riffel Road, Wooster,
Ohio, on July 23, 1998 at 10:00 a.m. Ohio time.
A Proxy Card and a Proxy Statement for the Meeting are
enclosed.
The Meeting is for the purpose of considering and acting
upon:
1. The election of three directors of the Company; and
2. The ratification of the appointment of Grant Thornton
LLP as auditors for the Company for the fiscal year ending March
31, 1999; and
such other matters as may properly come before the Meeting, or
any adjournments thereof. The Board of Directors is not aware of
any other business to come before the Meeting.
Any action may be taken on the foregoing proposals at the
Meeting on the date specified above, or on any date or dates to
which the Meeting may be adjourned. Stockholders of record at
the close of business on June 12, 1998, are the stockholders
entitled to vote at the Meeting, and any adjournments thereof.
EACH STOCKHOLDER, WHETHER HE OR SHE PLANS TO ATTEND THE
MEETING, IS REQUESTED TO SIGN, DATE AND RETURN THE ENCLOSED PROXY
CARD WITHOUT DELAY IN THE ENCLOSED POSTAGE-PAID ENVELOPE. ANY
PROXY GIVEN BY THE STOCKHOLDER MAY BE REVOKED AT ANY TIME BEFORE
IT IS EXERCISED. A PROXY MAY BE REVOKED BY FILING WITH THE
SECRETARY OF THE COMPANY A WRITTEN REVOCATION OR A DULY EXECUTED
PROXY BEARING A LATER DATE. ANY STOCKHOLDER PRESENT AT THE
MEETING MAY REVOKE HIS OR HER PROXY AND VOTE PERSONALLY ON EACH
MATTER BROUGHT BEFORE THE MEETING. HOWEVER, IF YOU ARE A
STOCKHOLDER WHOSE SHARES ARE NOT REGISTERED IN YOUR OWN NAME, YOU
WILL NEED ADDITIONAL DOCUMENTATION FROM YOUR RECORD HOLDER TO
VOTE PERSONALLY AT THE MEETING.
By Order of the Board of Directors
/s/ Charles F. Finn
Charles F. Finn
Chairman, President and Chief
Executive Officer
Wooster, Ohio
June 25, 1998
<PAGE>
PROXY STATEMENT
WAYNE SAVINGS BANCSHARES, INC.
151 North Market Street
Wooster, Ohio 44691
(330) 264-5767
NOTICE OF
1998 ANNUAL MEETING OF STOCKHOLDERS
July 23, 1998
This Proxy Statement is furnished in connection with the
solicitation of proxies on behalf of the Board of Directors of
Wayne Savings Bancshares, Inc. (the "Company") to be used at the
1998 Annual Meeting of Stockholders of the Company (the
"Meeting"), which will be held at the Black Tie Affair Conference
Center, 50 Riffel Road, Wooster, Ohio, on July 23, 1998, at
10:00 a.m., Ohio time, and all adjournments of the Meeting. The
accompanying Notice of Annual Meeting of Stockholders and this
Proxy Statement are first being mailed to stockholders on or
about June 25, 1998.
REVOCATION OF PROXIES
Stockholders who execute proxies in the form solicited
hereby retain the right to revoke them in the manner described
below. Unless so revoked, the shares represented by such proxies
will be voted at the Meeting and all adjournments thereof.
Proxies solicited on behalf of the Board of Directors of the
Company will be voted in accordance with the directions given
thereon. Please sign and return your Proxy to the Company in
order for your vote to be counted. Proxies which are signed, but
contain no instructions for voting, will be voted "FOR" the
proposals set forth in this Proxy Statement for consideration at
the Meeting.
Proxies may be revoked by sending written notice of
revocation to the Secretary of the Company at the address of the
Company shown above, or by filing a duly executed proxy bearing a
later date. The presence at the Meeting of any stockholder who
has given a proxy shall not revoke such proxy unless the
stockholder delivers his or her ballot in person at the Meeting
or delivers a written revocation to the Secretary of the Company
prior to the voting of such proxy.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Holders of record of the Company's common stock, par value
$1.00 per share ("Common Stock") as of the close of business on
June 12, 1998 (the "Record Date"), are entitled to one vote for
each share then held. As of the Record Date, there were
2,483,481 shares of Common Stock issued and outstanding. The
presence in person or by proxy of a majority of the outstanding
shares of Common Stock entitled to vote is necessary to
constitute a quorum at the Meeting.
As to the election of directors, the proxy card being
provided by the Board of Directors enables a stockholder to vote
FOR the election of the nominees proposed by the Board, or to
WITHHOLD authority to vote for one or more of the nominees being
proposed. Directors are elected by a plurality of votes of
shares present in person or by proxy and entitled to vote; broker
non-votes will not be counted as shares present and entitled to
vote. Wayne Savings Bancshares, M.H.C., the Company's parent
mutual holding company (the "Mutual Holding Company"), which owns
a majority of the outstanding Common Stock, has indicated its
intention to vote in favor of all matters presented to
stockholders at the Annual Meeting, which would ensure the
approval of such matters.
<PAGE>
Persons and groups owning in excess of 5% of the Common
Stock are required to file certain reports with the Securities
and Exchange Commission (the "SEC") regarding such ownership
pursuant to the Securities Exchange Act of 1934 (the "Exchange
Act"). The following table sets forth, as of June 12, 1998, the
shares of Common Stock beneficially owned by all directors and
executive officers as a group and by each person who was the
beneficial owner of more than 5% of the outstanding shares of
Common Stock. This information is based solely upon information
supplied to the Company and the filings required pursuant to the
Exchange Act.
<TABLE>
Amount of Shares
Owned and Nature Percent of Shares
Name and Address of of Beneficial of Common Stock
Beneficial Owners Ownership (1) Outstanding
<S> <C> <C>
Wayne Savings Bankshares, 1,286,380 51.8%
M.H.C. (2)
151 North Market Street
Wooster, Ohio 44691
All Directors and Executive 215,093 (3) 8.7
Officers as a Group
(11 persons)
</TABLE>
- ------------------------
(1) In accordance with Rule 13d-3 under the Exchange Act, a
person is deemed to be the beneficial owner for purposes of this
table, of any shares of Common Stock if he has sole or shared
voting or investment power with respect to such security, or has
a right to acquire beneficial ownership at any time within 60
days from the date as of which beneficial ownership is being
determined. As used herein, "voting power" is the power to vote
or direct the voting of shares and "investment power" is the
power to dispose or direct the disposition of shares. Includes
all shares held directly as well as by spouses and minor
children, in trust and other indirect ownership, over which
shares the named individuals effectively exercise sole or shared
voting and investment power.
(2) The Company's executive officers and directors are also
executive officers and directors of the Mutual Holding Company.
(3) Includes 15,496 shares of common stock underlying options
granted pursuant to The Wayne Savings and Loan Company 1993 Stock
Option Plan for Outside Directors and 20,652 shares subject to
options under The Wayne Savings and Loan Company 1993 Incentive
Stock Option Plan that may be exercised within 60 days of the
date as of which beneficial ownership is being determined.
<PAGE>
PROPOSAL I ELECTION OF DIRECTORS
The Company's Board of Directors is currently composed of
seven members. The Company's Bylaws provide that approximately
one-third of the directors are to be elected annually. Directors
of the Company are generally elected to serve for a three year-
period and until their respective successors shall have been
elected and shall qualify. Three directors will be elected at
the Meeting to serve for a three-year period and until their
respective successors have been elected and qualified. The Board
of Directors has nominated to serve as directors Donald E.
Massaro, Russell L. Harpster and Terry A. Gardner, each of whom
is currently a member of the Board of Directors.
The table below sets forth certain information regarding the
composition of the Company's Board of Directors, including the
terms of office of Board members. It is intended that the
proxies solicited on behalf of the Board of Directors (other than
proxies in which the vote is withheld as to one or more nominees)
will be voted at the Meeting for the election of the nominees
identified below. If any nominee is unable to serve, the shares
represented by all such proxies will be voted for the election of
such substitute as the Board of Directors may recommend. At this
time, the Board of Directors knows of no reason why any of the
nominees might be unable to serve, if elected. Except as
indicated herein, there are no arrangements or understandings
between any nominee and any other person pursuant to which such
nominee was selected.
<TABLE>
<CAPTION>
Shares of
Common Stock
Positions Beneficially
Held in the Director Current Term Owned on the Percent
Name Age Company Since(1) To Expire Record Date Of Class
- ---------------------------------------------------------------------------------------------------
NOMINEES
<S> <C> <C> <C> <C> <C> <C>
Donald E. Massaro 69 Director 1990 1998 15,554 (4) *
Russell L. Harpster 63 Director 1979 1998 36,650 (5) 1.5
Terry A. Gardner 51 Director 1994 1998 29,993 1.2
DIRECTORS CONTINUING IN OFFICE
Charles F. Finn 60 Chairman of the Board, 1976 1999 38,059 (6) 1.5
President, and Chief
Executive Officer
Joseph L. Retzler 70 Director 1985 1999 14,735 (7) *
Kenneth G. Rhode 89 Director 1958 2000 44,974 1.8
James C. Morgan 60 Director 1995 2000 1,492 *
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Wanda Christopher-Finn 55 Executive Vice 23,984 (8) *
President
Gary C. Miller 57 Senior Vice President 8,222 (9) *
Todd J. Tappel 34 Senior Vice President and 1,430 *
Chief Financial Officer
Anthony Volpe 46 Vice President and Controller *
/TABLE
<PAGE>
- --------------------------------
(*) Less than 1%.
(1) The mailing address for each person listed is 151 North
Market Street, Wooster, Ohio 44691. Each of the persons listed
is also a director or executive officer of the Mutual Holding
Company which owns the majority of the outstanding shares of
Common Stock.
(Footnotes continued on following page)
<PAGE>
(Continued from previous page)
(2) Reflects initial appointment to the Board of Directors of
Wayne Savings Community Bank (the "Bank," or "Wayne Savings"),
the Company's wholly-owned subsidiary.
(3) See definition of "beneficial ownership" in the table in
"Voting Securities and Principal Holders Thereof."
(4) Includes options to purchase 5,082 shares pursuant to the
1993 Stock Option Plan for Outside Directors (the "Directors'
Plan").
(5) Includes options to purchase 5,207 shares pursuant to the
Directors' Plan.
(6) Includes options to purchase 12,383 shares pursuant to the
1993 Incentive Stock Option Plan (the "Stock Option Plan").
(7) Includes options to purchase 5,207 shares pursuant to the
Directors' Plan.
(8) Includes options to purchase 7,887 shares pursuant to the
Stock Option Plan.
(9) Includes options to purchase 382 shares pursuant to the
Stock Option Plan.
The principal occupation during the past five years of each
director and executive officer of the Company is set forth below.
All directors and executive officers have held their present
positions for five years unless otherwise stated.
Kenneth G. Rhode has been Chairman of the Board of the Bank
since 1972. He was Chief Executive Officer of Lightning Rod
Mutual and Western Reserve Mutual Insurance Companies of Wooster,
Ohio prior to his retirement in 1988.
Charles F. Finn has been President and Chief Executive
Officer of the Bank since 1983. He has been employed by Wayne
Savings for 34 years. Mr. Finn is the spouse of Wanda
Christopher-Finn, Executive Vice President of the Company. He was
appointed Chairman of the Board of Directors of the Company on
September 25, 1997.
Donald E. Massaro has been affiliated with the Bank for 33
years. He previously was an officer of the Bank and retired in
December 1992.
Russell L. Harpster is an attorney and a partner in the law
firm of Henderson, Harpster & Vanosdall in Ashland, Ohio.
Joseph L. Retzler is President of Retzler Hardware in
Wooster, Ohio.
Terry A. Gardner is President and General Partner of Terra
Management, Inc., in Wooster, Ohio, a firm involved in the
construction and management of multi-family housing projects. He
was elected director on October 25, 1994 to fill the unexpired
term of a retiring director.
James C. Morgan is President of Franklin Oil & Gas, Inc. in
Wooster, Ohio. He was elected director on February 28, 1995 to
fill the unexpired term of a retiring director.
Wanda Christopher-Finn is Executive Vice President, Chief
Administrative Officer and has been affiliated with the Bank
since 1972. Ms. Christopher-Finn is the spouse of Charles Finn.
Gary C. Miller became Senior Vice President, Manager of the
Loan Origination Division in February 1996 and was promoted to
Chief Lending Officer in August 1997. He was previously Vice
President, Manager of Mortgage Loans. He has been affiliated
with Wayne Savings since 1971.
Todd J. Tappel joined the Bank in April 1996 as Vice
President, Director of Planning. Mr. Tappel was promoted to
Senior Vice President in March, 1997 and to Chief Financial
Officer in August, 1997. He also serves as the Company's
Corporate Secretary. He previously worked for the Office of
Thrift Supervision as a federal thrift regulator.
Anthony Volpe joined the Bank in September, 1997 as Vice
President and Controller. He previously held a similar position
with another financial institution.
<PAGE>
Meetings and Committees of the Board of Directors
The business of the Company's Board of Directors is
conducted through meetings and activities of the Board and its
committees. During the year ended March 31, 1998, the Board of
Directors held seven regular and no special meetings. During the
year ended March 31, 1998, no director attended fewer than 75
percent of the total meetings of the Board of Directors of the
Company and committees on which such director served.
The Executive Committee of the Board of Directors consists
of Directors Kenneth Rhode, Charles Finn, Russell Harpster and
Joseph Retzler, and meets as necessary between meetings of the
full Board of Directors. All actions of the Executive Committee
must be ratified by the full Board of Directors. The Executive
Committee met four times during the year ended March 31, 1998.
The Executive Committee also serves as the Compensation
Committee of the Company, and meets periodically to review the
performance of officers and employees and determine compensation
programs and adjustments. The Executive Committee met three
times in its capacity as the Compensation Committee during the
year ended March 31, 1998.
The Audit Committee consists of Directors Kenneth Rhode,
Donald Massaro, Terry Gardner and James Morgan. This Committee
meets on a quarterly basis with the internal auditor to review
audit programs and the results of audits of specific areas as
well as other regulatory compliance issues. The Company's Audit
Committee met two times during the year ended March 31, 1998.
The Nominating Committee consists of the full Board of
Directors. While the Nominating Committee will consider nominees
recommended by stockholders, it has not actively solicited
recommendations from the Company's stockholders for nominees, nor
established any procedures for this purpose. Any nominations
must, however, be made pursuant to applicable provisions of the
Company's Bylaws. The Board of Directors met one time in its
capacity as the Nominating Committee during the fiscal year ended
March 31, 1998.
Ownership Reports by Officers and Directors
The Common Stock is registered pursuant to Section 12(g) of
the Exchange Act. The officers and directors of the Company and
beneficial owners of greater than 10% of the outstanding shares
of Company Common Stock ("10% beneficial owners") are required to
file reports on Forms 3, 4 and 5 with the SEC disclosing
beneficial ownership and changes in beneficial ownership of the
Company Common Stock. SEC rules require disclosure in the
Company's Proxy Statement and Annual Report on Form 10-KSB of the
failure of an officer, director or 10% beneficial owner of the
Company Common Stock to file a Form 3, 4 or 5 on a timely basis.
Based on the Company's review of such ownership reports, no
officer, director or 10% beneficial owner of the Company failed
to file ownership reports on a timely basis for the fiscal year
ended March 31, 1998.
Executive Compensation
The following table sets forth for the fiscal years ended
March 31, 1998, 1997 and 1996, certain information as to the
total remuneration paid by the Company to the Chief Executive
Officer of the Company. Information in the table below has been
adjusted for the 5% stock dividend paid in June 1996, and the
three-for-two stock split paid in June 1997, and the 10% stock
dividend paid in June 1998.<PAGE>
<TABLE>
<CAPTION>
Summary Compensation Table
Long-Term
Annual Compensation Compensation Awards
Restricted
Other Annual Stock Options/ All Other
Name and Year Ended Salary Bonus Compensation Award(s) SARs LTIP Compensation
Principal Position March 31, ($) ($) (3) Payout ($)(4)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Charles F. Finn 1998 $130,000 $23,000 -- -- -- -- $22,079
Chairman, 1997 120,000 18,000 -- -- -- -- 21,893
President and 1996 115,427 12,000 -- -- -- -- 12,616
Chief Executive
Officer
/TABLE
<PAGE>
(1) No compensation has been deferred at the election of the
executive. Does not include benefits pursuant to the Company's
Pension Plan. See "Benefits."
(2) No other executive officer received salary and bonuses that
in the aggregate exceeded $100,000.
(3) The Company also provides certain members of senior
management with the use of an automobile, membership dues and
other personal benefits. The aggregate amount of such other
benefits provided to Mr. Finn did not exceed the lesser of
$50,000 or 10% of his total annual salary.
(4) Includes the market value at March 31 of shares of common
stock allocated to Mr. Finn pursuant to the Bank's Employee Stock
Ownership Plan.
Employment and Severance Arrangements
The continued success of the Company depends to a
significant degree on the skills and competence of its officers.
The Bank entered into severance agreements with certain executive
officers, to which the Company has succeeded, including
Charles F. Finn, Chairman, President and Chief Executive Officer
of the Company. The severance agreements are intended to assist
the Company in maintaining a stable and competent management base
by enabling the Company to offer to designated employees certain
protections against termination without cause in the event of a
"change in control" as defined in the severance agreements.
These protections against termination without cause in the event
of a change in control are frequently offered by other financial
institutions, and the Company may be at a competitive
disadvantage in attracting and retaining key employees if it does
not offer similar protections. Although the severance agreements
may have the effect of making a takeover more expensive to an
acquiror, the Company believes that the benefits of enhancing the
Company's ability to attract and retain qualified management
persons by offering the severance agreements outweighs any
disadvantage of such agreements. The Company has not in the past
experienced problems attracting and retaining qualified
management persons.
The severance agreements provide that at any time following
a "change in control" of the Company, if the officer's employment
with the Company is involuntarily, or in certain circumstances
voluntarily, terminated during the term of the agreement for any
reason other than "cause" (as defined in the agreement), the
officer would be entitled to receive a payment in an amount equal
to three times the preceding year's base salary. For the
purposes of the severance agreements, a "change in control" is
defined to include: (i) a plan of reorganization, merger, merger
conversion, consolidation, or sale of all or substantially all of
the assets of the Company or the Mutual Holding Company or
similar transaction in which the Company or Mutual Holding
Company is not the resulting entity; (ii) certain changes in the
Board of Directors of the Company or the Mutual Holding Company;
and (iii) a change in control of the Company or
<PAGE>
the Mutual Holding Company within the meaning of 12 C.F.R.
Section 574.4. The severance agreements provide for an initial
one-year term. At the end of the first year, and each year
thereafter, the severance agreements may be extended by the Board
of Directors for an additional year.
Directors' Compensation
Fees. During the fiscal year ended March 31, 1998, the
Company's directors received no fees for serving on the Company's
Board of Directors or committees of the Company. Each outside
director who served on the Board of Directors of the Bank during
the fiscal year ended March 31, 1998 received a monthly meeting
fee of $759 and a monthly retainer of $506. The monthly meeting
fee is paid to the director only if the director attends the
meeting or has an excused absence. No additional fees were paid
for special meetings of the Board of Directors. In addition, the
Company paid each Director Emeritus up to two-thirds of the fees
such Director Emeritus received in the year prior to being
appointed Director Emeritus, excluding committee fees. During
the fiscal year ended March 31, 1998, the members of the
Executive Committee received an annual fee of $2,000; however,
Kenneth Rhode, Chairman of the Board of Directors of the Bank,
received a grandfathered executive committee fee of $4,000.
Members of the Loan Committee and Audit Committee received an
annual fee of $1,800. Directors who attend the monthly meetings
of the Company's Asset Review Committee received a fee of $100
for each meeting attended. The Chairman of the Board of
Directors of the Bank and Chairman of the Executive Committee
received $12,850 in additional fees during the fiscal year ended
March 31, 1998. Mr. Finn did not receive any fees as Chairman of
the Board of the Company.
Stock Option Plan for Outside Directors. The Board of
Directors of the Bank adopted the 1993 Stock Option Plan for
Outside Directors (the "Directors' Plan") in connection with its
conversion to stock form in 1993. The Directors' Plan was
ratified by the Bank's stockholders at the 1993 Annual Meeting.
The Directors' Plan authorizes the grant of non-statutory stock
options for 34,303 shares (as adjusted) of common stock to non-
employee directors of the Company, as adjusted to reflect a 10%
stock dividend, three-for-two stock split and 5% stock dividend
which were distributed June 10, 1998, June 12, 1997 and June 11,
1996, respectively. The Directors' Plan is a self administering
plan that granted to Messrs. Rhode, Harpster, Retzler, and
Massaro non-statutory options to purchase 6,861, 5,207, 5,207 and
5,082 shares of Common Stock (as adjusted), respectively. Grants
of stock options were determined as follows: options to purchase
5,970 shares (as adjusted) were granted to outside directors with
more than 15 years of service; options to purchase 5,207 shares
(as adjusted) were granted to each outside director with 5 to 15
years of service; options to purchase 5,082 shares (as adjusted)
were granted to outside directors with less than 5 years of
service; and options to purchase an additional 891 shares (as
adjusted) were granted to the Chairman of the Board. The
exercise price of the options is equal to the fair market value
of the shares of Common Stock underlying such option on the date
the option was granted, or $5.25 per share (as adjusted) of
Common Stock for options granted on the date of completion of the
Offering. All options granted under the Directors' Plan may be
exercised from time to time in whole or in part, and expire upon
the earlier of 10 years following the date of grant or one year
following the date the optionee ceases to be a director.
Benefits
Pension Plan. The Bank makes available to all full-time
employees who have attained the age of 21 and completed one year
of service with the Bank a defined benefit pension plan. The
pension plan provides for monthly payments to or on behalf of
each covered employee upon the employee's normal retirement date
(i.e., the first day of the month coincident with or next
following the later of age 65 or 5 years of participation).
These payments are calculated in accordance with a formula based
on the employee's "average monthly compensation," which is
defined as the highest average of total compensation for five
consecutive calendar years of employment. The normal retirement
benefit is equal to 29% of the "average monthly compensation" up
to the integration level, plus 51% of the "average monthly
compensation" in excess of the integration level, reduced for
less than 35 years of service. The normal form of benefit is a
monthly income payable for life. Optional forms of benefit are
available.
<PAGE>
Under the pension plan, the Bank makes an annual
contribution for the benefit of eligible employees computed on an
actuarial basis. Employee benefits under the plan vest as
designated in the schedule below:
<TABLE>
Completed Years Vested
of Employment Percentages
<S> <C>
Fewer than 3 0
3 but less than 4 20%
4 but less than 5 40%
5 but less than 6 60%
6 but less than 7 80%
7 or more 100%
</TABLE>
The following table illustrates regular annual allowance
amounts at age 65 under the regular retirement benefit plan
provisions available at various levels of compensation and years
of benefit service (figured on formula described above):
<TABLE>
<CAPTION>
Years of Benefit Service
------------------------------------------------------------
Average
Salary 10 15 20 25 30 35
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 20,000 $ 2,000 $ 3,000 $ 4,000 $ 4,975 $ 5,975 $ 6,975
$ 30,000 3,450 5,175 6,900 8,625 10,350 12,075
$ 50,000 6,375 9,550 12,725 15,900 19,100 22,275
$ 80,000 10,750 16,100 21,475 26,850 32,200 37,575
$100,000 13,650 20,475 27,300 34,125 40,950 47,775
</TABLE>
At March 31, 1998, Mr. Finn had 34 years of credited service
under the pension plan.
Stock Option Plan. The Board of Directors of the Bank
adopted the 1993 Incentive Stock Option Plan (the "Stock Plan")
in connection with its conversion to stock form in 1993. The
Stock Plan was ratified by the Bank's stockholders at the 1993
Annual Meeting. Set forth below is information concerning
exercised and unexercisable options held by Mr. Finn at March 31,
1998.<PAGE>
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUE
Number of Securities
Underlying Unexercised Value of Unexercised In-
Options at The-Money Options at
Fiscal Year-End Fiscal Year-End(2)
Shares Acquired Value
Name Upon Exercise Realized(1) Exercisable/Unexercisable Exercisable/Unexercisable
<S> <C> <C> <C> <C>
Charles F. Finn 1,100 $22,979 9,686/2,696 $202,340/$56,319
/TABLE
<PAGE>
(1) Equals the difference between the aggregate exercise price
of such options and the aggregate fair market value of the shares
of common stock that would be received upon exercise, assuming
such exercise occurred on March 31, 1998 (based on the price of
the last sale reported on the Nasdaq SmallCap Market on March 31,
1998).
<PAGE>
Certain Transactions with the Company
Federal law and regulation generally requires that all loans
or extensions of credit to executive officers and directors must
be made on substantially the same terms, including interest rates
and collateral, as those prevailing at the time for comparable
transactions with the general public and must not involve more
than the normal risk of repayment or present other unfavorable
features. However, recent regulations now permit executive
officers and directors to receive the same terms through benefit
or compensation plans that are widely available to other
employees, as long as the director or executive officer is not
given preferential treatment compared to the other participating
employees. Pursuant to such a program, the Bank has extended a
loan to Senior Vice President Todd J. Tappel which has been
secured by a mortgage on his personal residence. During the
fiscal year ended March 31, 1998, the largest amount of the loan
outstanding was $118,634. As of March 31, 1998, $117,377 of the
loan remained outstanding and Mr. Tappel was being charged an
interest rate of 7.125%. All loans made to a director or
executive officer in excess of the greater of $25,000 or 5% of
the Company's capital and surplus (up to a maximum of $500,000)
must be approved in advance by a majority of the disinterested
members of the Board of Directors. Other than as described
above, all loans the principal balances of which exceeded $60,000
at any time during the fiscal year ended March 31, 1998, made by
the Company to executive officers, directors, immediate family
members of executive officers and directors, or organizations
with which executive officers and directors are affiliated, were
made in the ordinary course of business, on substantially the
same terms including interest rates and collateral, as those
prevailing at the time for comparable transactions with other
persons.
As of March 31, 1998, the aggregate principal balance of
loans outstanding for all executive officers and directors, and
family members was $209,000.
Director Russell L. Harpster is a partner in the law firm of
Henderson, Harpster & Vanosdall of Ashland, Ohio, which has
represented the Company in certain legal matters since 1979.
During the fiscal year ending March 31, 1998, the Company paid
$11,427 in legal fees to the law firm. No retainer was paid, and
the Company was billed for services performed at the firm's
hourly rate.
PROPOSAL II RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors of the Company has approved the
engagement of Grant Thornton LLP to be the Company's auditors for
the fiscal year ending March 31, 1999, subject to the
ratification of the engagement by the Company's stockholders. At
the Meeting, the stockholders will consider and vote on the
ratification of the engagement of Grant Thornton LLP for the
Company's fiscal year ending March 31, 1999. A representative of
Grant Thornton LLP is expected to attend the Meeting to respond
to appropriate questions and to make a statement if he so
desires.
In order to ratify the selection of Grant Thornton LLP as
the auditors for the fiscal year ending March 31, 1999, the
proposal must receive at least a majority of the votes cast,
either in person or by proxy, in favor of such ratification. The
Board of Directors recommends a vote "FOR" the ratification of
Grant Thornton LLP as auditors for the 1999 fiscal year.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy
materials for next year's Annual Meeting of Stockholders, any
stockholder proposal to take action at such meeting must be
received at the Company's executive office, 151 North Market
Street, Wooster, Ohio 44691, no later than February 25, 1999.
Any such proposals shall be subject to the requirements of the
proxy rules adopted under the Exchange Act.
<PAGE>
OTHER MATTERS
The Board of Directors is not aware of any business to come
before the Meeting other than the matters described above in the
Proxy Statement. However, if any matters should properly come
before the Meeting, it is intended that holders of the proxies
will act in accordance with their best judgment.
MISCELLANEOUS
The cost of solicitation of proxies will be borne by the
Company. The Company will reimburse brokerage firms and other
custodians, nominees and fiduciaries for reasonable expenses
incurred by them in sending proxy materials to the beneficial
owners of Common Stock. In addition to solicitations by mail,
directors, officers and regular employees of the Company may
solicit proxies personally or by telegraph or telephone without
additional compensation. The Company's 1998 Annual Report to
Stockholders has been mailed to all stockholders of record as of
the close of business on June 12, 1998. Any stockholder who has
not received a copy of such Annual Report may obtain a copy by
writing the Company. Such Annual Report is not to be treated as
a part of the proxy solicitation material nor as having been
incorporated herein by reference.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE
FISCAL YEAR ENDED MARCH 31, 1998, WILL BE FURNISHED WITHOUT
CHARGE TO STOCKHOLDERS AS OF THE RECORD DATE UPON WRITTEN REQUEST
TO TODD J. TAPPEL, CORPORATE SECRETARY, WAYNE SAVINGS BANCSHARES,
INC., 151 NORTH MARKET STREET, WOOSTER, OHIO 44691.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Charles F. Finn
Charles F. Finn
Chairman, President and Chief
Executive Officer
Wooster, Ohio
June 25, 1998
<PAGE>
WAYNE SAVINGS BANCSHARES, INC.
ANNUAL MEETING OF STOCKHOLDERS
July 23, 1998
The undersigned hereby appoints the official proxy committee
consisting of four members of the Board of Directors, who are not
named as nominees on the reverse side, with full powers of
substitution to act as attorney and proxy for the undersigned,
and to vote all shares of Common Stock of Wayne Savings
Bancshares, Inc. which the undersigned is entitled to vote, at
the Annual Meeting of Stockholders, to be held at the Black Tie
Affair Conference Center, 50 Riffel Road, on July 23, 1998 at
10:00 a.m. Ohio time, and at any and all adjournments thereof, as
indicated on the reverse side.
PLEASE SIGN, DATE AND MAIL THIS PROXY CARD PROMPTLY USING
THE ENCLOSED POSTAGE-PAID ENVELOPE.
This proxy is revocable and will be voted as directed, but
if no instructions are specified, this proxy will be voted FOR
each of the proposals listed. If any other business is presented
at the meeting, this proxy will be voted by those named in this
proxy in their best judgment.
This proxy is solicited by the Board of Directors.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED
PROPOSALS.
FOR WITHHOLD
1. The election as directors of all nominees / / / /
listed below (except as marked to the
contrary below)
Terry A. Gardner
Russell L. Harpster
Donald E. Massaro
INSTRUCTION: To withhold your vote for any individual
nominee, mark "For All Except" and write the name of the
nominees(s) in the space provided below.
- -----------------------------------------------------------------
FOR AGAINST ABSTAIN
2. The ratification of the appointment / / / / / /
of Grant Thornton LLP as auditors
for the fiscal year ending
March 31, 1999.
Should the undersigned be present and elect to vote at the
Meeting or at any adjournment thereof and after notification to
the Secretary of the Company at the Meeting of the stockholder's
decision to terminate this proxy, then the power of said
attorneys and proxies shall be deemed terminated and of no
further force and effect. This proxy may also be revoked by
sending written notice to the Secretary of the Company at the
address set forth on the Notice of Annual Meeting of
Stockholders, or by the filing of a later proxy prior to a vote
being taken on a particular proposal at the Meeting.
The undersigned acknowledges receipt from Wayne Savings
Bancshares, Inc. prior to the execution of this proxy of notice
of the Meeting, a proxy statement dated June 25, 1998, and
audited financial statements.
Dated: -----------------, 1998
Check Box if You Plan
to Attend Meeting / /
- ------------------------- -------------------------
PRINT NAME OF STOCKHOLDER PRINT NAME OF STOCKHOLDER
- ------------------------- -------------------------
SIGNATURE OF STOCKHOLDER SIGNATURE OF STOCKHOLDER
Please sign exactly as your name appears on this card. When
signing as attorney, executor, administrator, trustee or
guardian, please give your full title. If shares are held
jointly, each holder may sign but only one signature is required.
