<PAGE> 1
SCHEDULE 14-A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange
Act of l934
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
( ) Confidential, For Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
SUMMIT BANCSHARES, INC.
(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.
l) 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.
l) Amount Previously Paid:
........................
2) Form, Schedule or Registration Statement No.:
........................
3) Filing Party:
........................
4) Date Filed:
........................
<PAGE> 2
SUMMIT BANCSHARES, INC.
2969 Broadway
Oakland, California 94611
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be Held Thursday, April 24, 1997
TO THE SHAREHOLDERS OF SUMMIT BANCSHARES, INC.:
NOTICE IS HEREBY GIVEN that pursuant to its Bylaws and the call of its Board
of Directors, an Annual Meeting of Shareholders (the "Annual Meeting") of
Summit Bancshares, Inc. (the "Company") will be held at the principal offices
of the Company located at 2969 Broadway, Oakland, California, on Thursday,
April 24, 1997, at 2:00 p.m., for the purpose of considering and voting upon
the following matters:
1. The election of seven (7) persons to the Board of Directors to serve
until the 1998 Annual Meeting of Shareholders and until their successors are
elected and qualified.
2. The ratification of the selection of Coopers & Lybrand
L.L.P. to audit the financial statements of the Company for fiscal
year 1997.
3. The transaction of such other business as may properly
come before the Annual meeting.
Section 2.3 of the Bylaws of the Company provides for the nomination of
Directors in the following manner:
"Nominations for election of members of the Board of Directors may be made
by the Board of Directors or by any shareholder of any outstanding class of
voting stock of the Corporation entitled to vote for the election of
directors. Notice of intention to make any nominations, other than by the
Board of Directors, shall be made in writing and shall be received by the
President of the Corporation not more than sixty (60) days prior to any
meeting of shareholders called for the election of Directors, no more than
ten (10) days after the date the notice of such meeting is sent to
shareholders pursuant to Section 2.2 of these Bylaws, provided, however,
that if ten (10) days' notice of the meeting is given to shareholders, such
notice of intention to nominate shall be received by the President of the
Corporation not later than the time fixed in the notice of the meeting for
the opening of the meeting. Such notification shall contain the following
information to the extent known to the notifying shareholder: (a) the name
and address of each proposed nominee; (b) the principal occupation of each
proposed nominee; (c) the number of shares of voting stock of the
Corporation owned by each proposed nominee; (d) the name and residence
address of the notifying shareholder; and (e) the number of shares of
voting stock of the Corporation owned by the notifying shareholders.
Nominations not made in accordance herewith shall be disregarded by the
then chairman of the meeting, and the inspectors of election shall then
disregard all votes cast for such nominee."
Only those Shareholders of record at the close of business on February 28,
1997, will be entitled to notice of and to vote at the Annual Meeting.
IT IS VERY IMPORTANT THAT EVERY SHAREHOLDER VOTE. WE URGE YOU TO MARK, SIGN,
DATE AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE, WHETHER OR NOT YOU
PLAN TO ATTEND THE ANNUAL MEETING IN PERSON. IF YOU DO ATTEND THE ANNUAL
MEETING AND ELECT TO VOTE IN PERSON, YOU MAY DO SO. THE PROXY MAY BE REVOKED
AT ANY TIME PRIOR TO ITS EXERCISE.
Dated: March 26, 1997, at Oakland, California.
By Order of the Board of
Directors of Summit Bancshares,
Inc.
/s/ Shirley W. Nelson
-------------------------------
SHIRLEY W. NELSON
Chairman and Chief Executive
Officer
1
<PAGE> 3
SUMMIT BANCSHARES, INC.
2969 BROADWAY
OAKLAND, CALIFORNIA 94611
PROXY STATEMENT ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, APRIL 24, 1997
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies for use at the Annual Meeting of Shareholders (the "Annual Meeting") of
Summit Bancshares, Inc., (the "Company") to be held at 2969 Broadway, Oakland,
California, on Thursday, April 24, 1997, at 2:00 p.m. and at any adjournment or
adjournments thereof. THE SOLICITATION OF THE PROXY ACCOMPANYING THIS PROXY
STATEMENT IS MADE BY MANAGEMENT OF THE COMPANY AND THE COSTS OF SUCH
SOLICITATION, INCLUDING THE EXPENSE OF PREPARING, ASSEMBLING, PRINTING AND
MAILING THIS PROXY STATEMENT AND THE MATERIAL USED IN THIS SOLICITATION OF
PROXIES, WILL BE BORNE BY THE COMPANY. It is contemplated that Proxies will be
solicited through the mail, but officers and regular employees of the Company
may solicit Proxies personally. The Company will also request bank, brokers and
others who hold shares of the Company in nominee names to distribute annual
reports and proxy soliciting materials to beneficial owners, and will reimburse
such banks and brokers for reasonable out-of-pocket expenses which they may
incur in so doing.
It is expected that this Proxy Statement, the form of Proxy and
accompanying Notice will be mailed to Shareholders on or about March 27, 1997.
The matters to be considered and voted upon at the Annual Meeting will be:
1. The election of seven (7) persons to the Board of Directors to serve
until the 1998 Annual Meeting of Shareholders and until their successors are
elected and qualified.
2. The ratification of the selection of Coopers & Lybrand L.L.P.
to audit the financial statements of the Company for fiscal year 1997.
3. The transaction of such other business as may properly come
before the Annual Meeting.
A Proxy for use at the Annual Meeting is enclosed. Any Shareholder who
executes and delivers such Proxy has the right to revoke it at any time before
it is exercised (i) by filing with the Secretary of the Company an instrument
revoking it or a duly executed Proxy bearing a later date or (ii) by appearing
and voting in person at the Annual Meeting. Subject to such revocation, all
shares represented by a properly executed Proxy received in time for the Annual
Meeting will be voted by the Proxy Holders in accordance with
the instructions on the Proxy.
IF NO INSTRUCTION IS SPECIFIED WITH RESPECT TO A MATTER TO BE ACTED UPON
AT THE ANNUAL MEETING, THE SHARES REPRESENTED BY THE PROXY WILL BE VOTED IN
FAVOR OF (i) THE ELECTION AS DIRECTORS OF THE NOMINEES SET FORTH HEREIN, (ii)
THE RATIFICATION FOR FISCAL YEAR 1997 OF THE SELECTION OF COOPERS & LYBRAND
L.L.P. AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS, AND (iii) IN THE EVENT
OTHER BUSINESS IS PROPERLY PRESENTED AT THE ANNUAL MEETING, IN ACCORDANCE WITH
THE BEST JUDGMENT OF THE PROXY HOLDERS.
2
<PAGE> 4
VOTING SECURITIES
On December 18, 1996, the Board of Directors established February 28,
1997, as the Shareholders' record date for the purpose of determining the
Shareholders entitled to notice of and to vote at the Annual Meeting. As of
February 28, 1997, there were 429,224 shares of the Company's no par value
Common Stock issued and outstanding ("Common Stock").
Each holder of Common Stock entitled to notice of and to vote at the
Annual Meeting will be entitled to one vote, in person or by Proxy, for each
share of Common Stock held of record on the books of the Company as of the
record date for the Annual Meeting on any matter submitted to the vote of
Shareholders, except that in connection with the election of Directors, the
shares are entitled to be voted cumulatively if a candidate's or candidates'
name(s) have been properly placed in nomination prior to the voting and a
Shareholder present at the Annual Meeting has given notice of his or her
intention to vote his or her shares cumulatively. If a Shareholder has given
such notice, all Shareholders may cumulate their votes for candidates in
nomination. Cumulative voting entitles a Shareholder to give one nominee as
many votes as is equal to the number of Directors to be elected multiplied by
the number of shares owned by him or her, or to distribute his or her votes on
the same principle between two or more nominees as he or she sees fit. The
seven (7) nominees for Director receiving the highest number of votes shall be
elected as described more fully herein.
The ratification of the appointment of Coopers & Lybrand L.L.P. as the
Company's independent public accountants requires the affirmative vote of at
least a majority of the outstanding shares of the Company's Common Stock
represented in person or by proxy at the Annual Meeting of Shareholders.
PRINCIPAL SECURITY HOLDERS
Other than Shirley W. Nelson, and Thomas F. Louderback, Jr.,
the Company knows of no person who owns of record or beneficially,
either individually or together with his or her associates, more than
five per cent (5%) of the outstanding Common Stock of the Company.
The holdings of Shirley W. Nelson, and Thomas F. Louderback, Jr. are
as follows:
<TABLE>
<CAPTION>
AMOUNT AND
NAME AND NATURE OF
TITLE OF ADDRESS OF BENEFICIAL PERCENT OF
CLASS BENEFICIAL OWNER OWNERSHIP CLASS
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock Thomas F. Louderback, Jr. 26,547 6.18%
1233 21st Street
Oakland, CA 94607
Common Stock Shirley W. Nelson 84,241 18.54%
2969 Broadway
Oakland, CA 94611
</TABLE>
3
<PAGE> 5
SECURITY OWNERSHIP OF MANAGEMENT
The following table set forth, as of February 28, 1997, the number of
shares of the Company's Common Stock which may be deemed to be beneficially
owned by each Director and Nominee, the Chief Executive Officer and one other
Executive Officer of the Bank, and all Officers and Directors as a group and
the percentage of the outstanding Common Stock as owned:
<TABLE>
<CAPTION>
AMOUNT AND
NAME NATURE OF PERCENT
TITLE OF OF BENEFICIAL BENEFICIAL OF
CLASS OWNER OWNERSHIP(1) CLASS
- --------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock Jerrald R. Goldman 16,019 3.73%
Common Stock George H. Hollidge 18,152 (2) 4.23%
Common Stock Kikuo Nakahara 18,293 (3) 4.26%
Common Stock Shirley W. Nelson 84,241 (4) 18.54%
Common Stock Thomas H. State 300 .07%
Common Stock Mary C. Warren 0 .00%
Common Stock Barbara J. Williams 0 .00%
Common Stock C. Michael Ziemann 4,458 (5) 1.03%
Common Stock All Officers,
Directors and
Nominees (9 persons) 141,163 31.06%
</TABLE>
1. Unless otherwise indicated, the named individual exercises sole voting
and investment powers over the shares listed.
2. Includes 572 shares held by Mr. Hollidge as custodian for his child,
and 17,580 shares which were transferred into The Marie J. McKechnie Trust,
a revocable trust.
3. Includes 220 shares held by Mr. Nakahara as custodian for his children.
4. The number of shares does not include all of the 39,000 shares subject
to options under the Company's 1982 Incentive Stock Option Plan (the "ISO
Plan") and the 1992 Employee and Consultant Stock Option Plan, exercisable
in 10 equal yearly installments beginning July 1, 1983, of which 25,271
shares are currently exercisable but have not yet been exercised. The
25,271 shares exercisable are included in the number of shares
beneficially owned.
5. The number of shares does not include all of the 6,945 shares subject to
options under the Company's 1982 Incentive Stock Option Plan (the "ISO
Plan") and the 1992 Employee and Consultant Stock Option Plan, exercisable
in 10 equal yearly installments beginning July 1, 1983, of which 3,358
shares are currently exercisable but have not yet been exercised. The 3,358
shares exercisable are included in the number of shares beneficially owned.
4
<PAGE> 6
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Directors have fixed the exact number of Directors to serve until the
next Annual Meeting of Shareholders and until their successors are elected and
qualified at seven (7). Votes will be cast pursuant to the enclosed Proxy in
such a way as to effect the election of those seven (7) nominees, or as many
thereof as possible under applicable voting rules. All nominees have been
Directors of the Company since the last annual shareholders meeting. In the
event that any of the nominees should be unable to serve as Director, the
Proxies solicited hereby will be voted for the election of such substitute
nominee, if any, as shall be designated by the Board of Directors. Management
has no reason to believe that any nominee will become unavailable to serve.
The following table sets forth the names of, and certain information with
respect to, the persons nominated by the Board of Directors for election as
Directors:
<TABLE>
<CAPTION>
POSITION POSITION
WITH WITH DIRECTOR TERM
NAME AGE COMPANY BANK SINCE EXPIRES
- ----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Jerrald R. Goldman 58 Director Director 1995 1997
George H. Hollidge (2,3,4,5,6) 54 Director Director 1981(1) 1997
and and
Secretary Secretary
Kikuo Nakahara (2,3,4,5,6) 64 Director Director 1981(1) 1997
and
Chief
Financial
Officer
Shirley W. Nelson (3,6,7) 55 Director, Director, 1982 1997
Chairman, Chairman,
Chief and
Executive Chief
Officer, Executive
and Officer
President
Thomas H. State (2,3,4,6) 66 Director Director 1994 1997
Mary C. Warren (2) 75 Director Director 1996 1997
Barbara J. Williams (2,4,5) 60 Director Director 1981(1) 1997
</TABLE>
(1) Includes service as Director for the period during which the Company
was in organization.
(2) Audit Committee member
(3) Loan Committee member
(4) Personnel Committee member
(5) Stock Option Committee member
(6) Executive Committee Member
(7) Ms. Nelson is an Ex Officio member of the Audit and Personnel
Committees. In addition, she is Chairman of the Loan Committee.
5
<PAGE> 7
BUSINESS EXPERIENCE
The following is a brief account of the business experience of the
nominees to the Board of Directors.
GEORGE H. HOLLIDGE has been President of Hollidge Transmission, Inc.,
Oakland, transmission specialists, since 1980. Prior to 1980, Mr. Hollidge was
a partner in Hollidge Hydramatic, transmission specialists.
JERRALD R. GOLDMAN, M. D. has been an orthopedic surgeon with
offices in Oakland since 1972. Dr. Goldman is on the staff of Summit
Medical Center, Oakland; Highland General Hospital, Oakland; John Muir
Medical Center, Walnut Creek; and San Ramon Valley Medical Center, San
Ramon. He is an associate clinical professor in the Department of
Orthopedics at the University of California at San Francisco and
attending staff at Highland General Hospital. Dr. Goldman is also a
member of the Board of Governors of the Doctors' Company, an
Inter-insurance Exchange, a professional liability, inter-insurance
exchange doing business nationally. He is also the past Chairman of
the Board of Summit Bancshares, Inc from 1981 to 1989.
KIKUO NAKAHARA has been Managing Director of American Express Tax &
Business Services, Inc. in Walnut Creek. Prior to this position he was a
partner of Greene & Nakahara, an accounting firm in Walnut Creek, since 1993,
and which merged with IDS Financial Services Inc. in 1994. From 1978 to 1993 he
was managing Director of Greene, Nakahara and Lew Accountancy Corporation in
Oakland.
SHIRLEY W. NELSON has been the Chief Executive Officer and
President of the Company since May, 1983 as well as its Chairman since 1989.
She has also been the Chairman, Chief Executive Officer of the Bank since
1983. In addition, she was the President of the Bank from May, 1983 until
January 1, 1996.
THOMAS H. STATE retired as the President and CEO of Peninsula Bank of
Commerce in 1994. He began his banking career with Bank of America in the
mid-1950s. From 1960 to 1973, he held various managerial positions with Central
Valley National Bank and First National Bank of San Jose. In 1973, he joined
Alameda First National Bank as Vice President and advanced to Executive Vice
President, and in 1980, he was recruited to serve as the start-up President and
CEO for Peninsula Bank of Commerce.
MARY C. WARREN has worked as a government relations consultant since 1980
and is owner of Warren & Associates in Oakland. She held various management
positions with United States Post Office over a 30-year period and has worked
on the staffs of several state and federal elected officials. She serves on the
boards of the, Oakland Metropolitan Chamber of Commerce and the One Hundred
Club of Alameda County. For the past three years, she has been vice president
of Labor and Business for Alameda, Contra Costa and Solano Counties. In
addition, she is a Alameda County Honorary Deputy Sheriff.
BARBARA J. WILLIAMS was a histology technologist for twenty-five years and
until 1980, owned a laboratory in the "Pill Hill" area of Oakland. Since 1980,
Ms. Williams has been the sole proprietor of a company involved in real estate
rehabilitation and investment.
The following is a brief account of the business experience of Executive
Officers of the Bank.
C. MICHAEL ZIEMANN has been President and Chief Operating Officer of the
Bank since January 1, 1996. Prior to this position he was Chief Administrative
Officer of the Bank subsequent to his position as CFO and Cashier to which he
was appointed in April, 1987. Prior to that he was active in the administration
of the Bank and was the manager of the Bank's Walnut Creek Office since April
1985. Prior to joining the Bank, he held various positions during his 16 years
with Bank of America in operations, branch management, and regional
administration where he was a district administrator.
6
<PAGE> 8
COMMITTEES
The Company has a Stock Option Committee ("Option Committee") and
Summit Bank, the wholly-owned subsidiary of Summit Bancshares, Inc.
(the "Bank"), has a Directors' Personnel Committee ("Personnel
Committee") both of which have responsibilities as described below
relating to compensation of directors and executive officers. During
1996 the members of the Option Committee were George H. Hollidge,
Kikuo Nakahara and Barbara J. Williams.
The principal function of the Option Committee is to administer the ISO
Plan which was approved by the Shareholders of the Company at the Special
Shareholders' Meeting held December 15, 1982 as well as the 1992 Employee and
Consultant Stock Option Plan approved at the annual meeting held April 21,
1992. The Option Committee did not meet in 1996.
The Personnel Committee was formed in 1983 and its members during 1996 were
George Hollidge, Kikuo Nakahara, Thomas H. State, and Barbara Williams. The
Personnel Committee is responsible for establishing the method and level of
compensation of executive officers of the Bank. The Personnel Committee met 4
times in 1996
The Company has a standing Audit Committee and during 1996 its members
were George H. Hollidge, Kikuo Nakahara, Thomas H. State and Barbara Williams.
The Audit Committee is charged with the responsibility to recommend the
selection of an independent public accountant and to meet with the accountant
to discuss the course and scope of the Company's audit. The Audit Committee met
5 times in 1996.
The Company neither has nor during 1996 had a standing compensation
committee or any standing committee performing similar functions, other than
the Stock Option Committee and the Directors' Personnel Committee discussed
above.
The Company does not have a Nominating Committee. However, the Bylaws of
the Company, as set forth in the Notice accompanying this Proxy Statement,
provide a mechanism for Shareholder nomination of Directors.
The Company has a standing Loan Committee and during 1996 its members were
Shirley W. Nelson, George Hollidge, Kikuo Nakahara, Thomas State and in
addition Denise Dodini, the Senior Lending Officer for the Company's
subsidiary, Summit Bank. This committee has overall responsibility for credit
administration. The committee met 28 times during 1996.
The Company has a standing Executive Committee and during 1996 its
members were Shirley W. Nelson, George Hollidge, Kikuo Nakahara, and Thomas
State. The committee reviews and acts upon various matters or makes
recommendations to the Board for other corporate actions. The committee met
8 times during 1996.
There were six meetings of the Board of Directors of Summit Bancshares,
Inc. from January 1, 1996, to December 31, 1996. Each Director attended at
least 75% of the aggregate number of the Company's Directors' Meetings with the
exception of Jerrald R. Goldman M.D. who attended 67% of the meetings. The Bank
also held six meetings of the Board of Directors and all of the Directors
attended at least 75% of those meetings with the exception of Jerrald R.
Goldman M.D. who attended 67% of the meetings.
All of the Directors who serve on committees of the Board attended at least
75% of the aggregate number of such committee meetings.
PREVIOUS MEETINGS
Persons holding 76.23% of the outstanding shares participated in the April
25, 1996 Annual Meeting of the Shareholders in person or by proxy. The
following items were approved at that meeting:
1. 2 nominees for Director were elected by a vote of 323,406, and 5
nominees were elected by a vote of 299,609 (92.6% of the shares participating in
the 1996 meeting).
2. The selection of Arthur Andersen LLP to audit the financial statements
of the Company for the fiscal year 1996 was approved by a vote of 318,476
shares (98.5% of the shares participating in the 1996 meeting).
7
<PAGE> 9
CERTAIN TRANSACTIONS
There have been no transactions since January 1, 1996, or presently
proposed to which the Company or the Bank is a party in which any director,
officer, nominee for director, 5% Shareholder, any relative or spouse of any
such person or any relative of such spouse who has the same home as any such
person, of the Company or the Bank, has or is to have a direct or indirect
material interest. Excluded are any transactions where:
A. The rate or charges involved in the transaction are determined by
competitive bids, or the transaction involved the rendering of service as a
common or contract carrier, or public utility, at rates or charges fixed in
conformity with law or governmental authority;
B. The transaction involves services as a bank depository of funds,
transfer agent, registrant, trustee under a trust indenture, or similar
services;
C. The amount involved in the transaction or series of similar
transactions, including all periodic installments in the case of any lease or
other agreement providing for periodic payments or installments, does not exceed
$60,000; or
D. The interest of the specified person arises solely from ownership of
securities of the Company and the specified person receives no extra or special
benefit not shared on a prorated basis.
No director, officer, or nominee for director, or associate of such
director, nominee or officer of the Company or the Bank was indebted to the
Company or Bank during 1996 in an amount exceeding $60,000. Excluded are all
amounts due to any such person for purchases which in the opinion of management
are subject to usual trade terms, for ordinary travel and expense allowances
and for other transactions in the ordinary course of business. Excluded loans
include those made by the Bank to such persons pursuant to Federal Reserve
Regulation T and which in the opinion of management are 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 and not involving more than a normal risk of collectibility or
presenting other unfavorable features.
LEGAL PROCEEDINGS
From time to time the Company is a party to claims and legal proceedings
arising in the ordinary course of business. Currently, the Company has no
outstanding suits brought against it.
EXECUTIVE OFFICER COMPENSATION AND DIRECTOR COMPENSATION
FOR THE COMPANY AND THE BANK
No cash compensation was paid to or accrued for any person for serving
as an executive officer of the Company during 1996. Ms. Nelson and Mr.
Ziemann are compensated by the Bank. Directors' cash fees were paid during
1996 in the following manner: $850.00 for each bi-monthly Summit Bank Board
meeting attended by each of the seven Directors; $1,200 per month for all
Loan Committee meetings held during the month; $600.00 for each Executive
Committee attended; and $500.00 to the Chairman of the Audit and Personnel
Committees for each meeting held. Total compensation paid to the Directors
for 1996 was $103,252.
8
<PAGE> 10
SUMMARY COMPENSATION TABLE
The following table summarizes compensation earned in 1996, 1995 and
1994 by the Chief Executive Officer and one other Executive Officer of the
Bank. The other most highly paid executive officer is excluded as her total
salary and bonus did not exceed $100,000 for 1996.
SUMMARY COMPENSATION TABLE
------- ------------ -----
<TABLE>
<CAPTION>
Annual Compensation Awards
------------------- ------
Other
Annual Stock All Other
Compen- Options Compen-
Name and Principal Salary Bonus sation Granted sation
Position Year ($) ($) ($) (1) (#) ($) (2)
-----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Shirley W. Nelson 1996 172,500 70,000 7,200 0 12,500
Chr. & CEO 1995 172,500 65,000 7,200 0 15,000
1994 172,500 47,339 7,200 4,000 12,500
C. M. Ziemann (3) 1996 90,000 22,500 3,600 0 9,811
Pres. and COO 1995 80,000 25,000 3,600 0 11,275
1994 73,500 6,000 3,600 2,000 6,574
</TABLE>
(1) Automobile allowance
(2) Employer contribution to 401(k) Profit Sharing Plan
(3) Mr. Ziemann was elected as President of the Bank as of January 1, 1996.
PERSONNEL COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Compensaton of the CEO and other Executive Officers is recommended by the
Personnel Committee and approved by the Board. Shirley W. Nelson's compensation
is established in an employment agreement commencing January 1, 1990, with
pursuant to which she serves as the Chairman and Chief Executive Officer of the
Bank. During the term of the agreement, Ms. Nelson will be paid an annual
salary of $150,000, subject to increases at the discretion of the Board of
Directors. The Board increased her annual salary to $172,500 effective January
1, 1994 based on a annual compensation survey performed on behalf of California
Bankers Association by Deloitte & Touche LLP. This comparative study reviewed
various levels of compensation for officers and employees by bank asset size
throughout the State of California. In 1996, Ms. Nelson earned an additional
incentive bonus of $70,000, which is included in the above cash compensation
figure. Ms. Nelson also receives use of an automobile and a monthly auto
allowance of $600.00. In addition, she received $775 during 1996 in payment of
the remainder of her bonus earned in 1995. The deferred compensation amount
identified in the above chart represents Ms. Nelson's vested interest in the
1996 profit sharing contribution made by the Company as outlined below under
401(K) Profit Sharing Plan. Ms. Nelson is a participant in both the ISO Plan and
the 1992 Employee and Consultant Stock Option Plan, pursuant to which Ms. Nelson
has been granted options to purchase an aggregate of 39,000 shares of Common
Stock of the Company at an average per share exercise price of $11.30 in 10
equal yearly installments commencing July 1, 1983.
In 1994 the Board increased the annual salary of Mr. Ziemann to $73,500
with subsequent increases in the years 1995 and 1996 as outlined above based on
annual compensation surveys performed on behalf of California Bankers
Association by Deloitte & Touche LLP. This comparative study reviewed various
9
<PAGE> 11
levels of compensation for officers and employees by bank asset size throughout
the State of California. In 1996, Mr. Ziemann earned an additional incentive
bonus of $22,500, which is included in the above cash compensation figure. Mr.
Ziemann also receives a monthly auto allowance of $300.00. The deferred
compensation amount identified in the above chart represents Mr. Ziemann's
vested interest in the 1996 profit sharing contribution made by the Company as
outlined below under 401(K) Profit Sharing Plan. Mr. Ziemann is a participant
in both the ISO Plan and the 1992 Employee and Consultant Stock Option Plan,
pursuant to which Mr. Ziemann has been granted options to purchase an aggregate
of 6,945 shares of Common Stock of the Company at an average per share exercise
price of $14.14 in 10 equal yearly installments commencing July 1, 1983.
Submitted by the Personnel Committee:
Kikuo Nakahara
George H. Hollidge
Thomas H. State
Barbara J. Williams
STOCK OPTIONS
There were no stock options issued in 1996.
1996 AGGREGATE OPTION EXERCISES AND DECEMBER 31, 1996 OPTION VALUES
---- --------- ------ --------- --- -------- -- ---- ------ ------
<TABLE>
<CAPTION>
Number of Value of
Shares Covered Unexercised
by Unexercised In-the-Money
Options at Options at
Dec. 31, 1996 Dec. 31, 1996
Number of
Shares Value Exercisable/ Exerciseable/
Acquired on Realized Unexercisable Unexerciseable
Name Exercise ($) (1) (#) ($) (2)
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shirley W. Nelson 8,250 183,975 25,271/13,729 542,063/294,487
C. M. Ziemann 1,100 17,441 3,358/ 3,587 47,482/ 66,754
</TABLE>
(1) Calculated as the market value of the Common Stock on the date of
exercise less the applicable exercise price.
(2) Calculated as the difference between the market value of the
Common Stock on December 31, 1996 and the exercise price of the
options.
Other than life and disability insurance policies purchased for all
salaried employees of the Bank, including the executive officers, the premiums
of which are paid by the Bank, there are no other long term incentive plans,
pension, or other employee benefit plans in existence or anticipated except the
1992 Plan discussed below, including profit sharing and group health and
hospitalization plans which discriminate in scope, terms or operation in favor
of officers or directors of the Company or the Bank.
10
<PAGE> 12
STOCK PERFORMANCE CHART
The graph below compares the cumulative total stockholders return on the
Company's Common Stock with the cumulative total return on the Standard & Poor's
500 Index and the Montgomery Securities' Northern California Bank Proxy,
comprised of 16 Banks in Northern California (Footnote #1), for the five fiscal
years commencing December 31, 1992 and ending December 31, 1996, assuming an
investment of $100 and the reinvestment of any dividends.
The comparisons in the graph below are based upon historical data and are
not indicative of, nor intended to forecast, future performance of the Company's
Common Stock
(graph)
The data points depicted on the graph are as follows:
<TABLE>
<CAPTION>
Base Fiscal year ended December 31,
Year 1992 1993 1994 1995 1996
<S> <C> <C> <C> <C> <C> <C>
Summit Bank $100 $ 98 $105 $190 $207 $278
S&P 500 Composite Index 100 108 118 120 165 203
Northern California Bank Proxy 100 102 126 123 187 203
</TABLE>
(1) TriCo Bancshares, Exchange Bank, Redwood Empire Bancorp, Saving Bank of
Mendocino, RCB Corp (River City), Union Bank, Sumitomo Bank of California,
The Pacific Bank, Westamerica, Civic BanCorp, California Bancshares,
Cupertino National Bank, University National Bank and Trust, Silicon Valley
Bancshares, and Pacific Capital Corp.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
requires the Company's officers and directors, and persons who own more than
10% of a registered class of the Company's equity securities, to file reports
of ownership and changes in ownership with the Securities and Exchange
Commission ("SEC"). Officers, directors and shareholders owning greater than
10% of the Common Stock of the Company are required by SEC regulation to furnish
the Company with copies of all reports filed pursuant to Section 16(a).
Based solely on a review of copies of such reports required by Section
16(a) all persons required to file such reports did so on a timely bases except
as follows. Shirley W. Nelson inadvertently failed to file a Form 4 for an
exercise of an option to purchase 8,250 shares of Company stock in December,
1996. A Form 5 reporting this transaction was filed in January, 1997. Mr. Thomas
H. State inadvertently failed to file a Form 4 for the purchase of 200 shares of
Company stock in October, 1996. A Form 5 reporting this transaction was filed in
January, 1997.
11
<PAGE> 13
PROPOSAL NO. 2
RATIFICATION OF SELECTION OF INDEPENDENT
PUBLIC ACCOUNTANTS
The firm of Coopers & Lybrand L.L.P. is being recommended as the Company's
new independent public accountant. Although Arthur Andersen LLP, independent
public accountants, has audited the books and records of the Bank since its
organization in 1981, price differential between the two competing firms were
deemed to be too great for the Company to continue to retain Arthur Andersen
LLP. There were no disagreements with Arthur Andersen LLP in any of their
previous audits which would have caused this change. Coopers & Lybrand L.L.P.
is one of the "Big Six" firms and performs audits for approximately 20 of the
local banks and savings and loans in the Bay Area. Audit services performed by
Coopers & Lybrand L.L.P. will consist of examining financial statements,
preparing management letters, meetings with the Audit Committee of the Board of
Directors and consulting with the Bank on accounting matters. Also, for the year
ending December 31, 1997, Coopers & Lybrand L.L.P. will perform other non-audit
services for the Bank. Such non-audit services consist of tax service, which
included assistance in preparing and filing federal and state income tax
returns, consultation on tax planning matters and other miscellaneous tax
services.
The selection of an independent accounting firm to provide services for the
Bank is approved annually by the Bank's Board of Directors. The Board of
Directors desires to hire Coopers & Lybrand L.L.P. as the independent accounting
firm for the Bank and for the Company during the current fiscal year.
Accordingly, Shareholders are being asked to act upon a proposal to ratify
the Board of Director's selection of Coopers & Lybrand L.L.P. as the principal
independent accounting firm to audit the books and records of the Bank and the
Company and to perform other appropriate services during the current fiscal
year. If the Shareholders do not approve such proposal, the Board of Directors
will reconsider its action with respect to the selection of an independent
accounting firm.
ANNUAL REPORT TO SHAREHOLDERS
The Annual Report to Shareholders, including financial statements for the
year ended December 31, 1996, is provided to you herewith. If any Shareholder
should wish an additional copy of the Annual Report or a copy of the Company's
Report on Form 10-K filed with the Securities and Exchange Commission he or she
should contact Ms. Shirley W. Nelson at Summit Bancshares, Inc., 2969 Broadway,
Oakland, California, 94611 (Telephone: 510 839-8800). Copies will be provided
free of charge.
PROPOSALS BY SHAREHOLDERS
In accordance with the rules of the Securities and Exchange Commission,
Shareholders of the Company may present proposals to the Company, subject to the
certain limitations, for inclusions in the Company's Proxy Statement to be
prepared in connection with its next regular Annual Meeting of Shareholders in
April, 1998. Proposals must be received by January 1, 1998, to be considered for
inclusion in the Proxy Statement.
OTHER BUSINESS
If any other matters come before this meeting, not referred to in the
enclosed proxy, including matters incident to the conduct of the meeting, the
proxy holders will vote the shares represented by the proxies in accordance with
their best judgment. Management is not aware of any other business to come
before their meeting, and as of the date of the preparation of this Proxy
Statement, no Shareholder has submitted to management any proposals to be acted
upon at the meeting.
Dated: March 26, 1997
By Order of the Board of Directors
/s/ George H. Hollidge
-------------------------------------
GEORGE H. HOLLIDGE, Secretary
12
<PAGE> 14
PROXY
SUMMIT BANCSHARES, INC.
Only Shareholders of record as of the close of business on February 28, 1997
are entitled to notice of and to vote at the Annual Shareholders meeting. The
undersigned hereby appoints Shirley W. Nelson and George H. Hollidge and either
of them, proxies for the undersigned, with full power of substitution, to
represent the undersigned and to vote all the shares of the Common Stock of
Summit Bancshares, Inc. (the "Company") which the undersigned is entitled to
vote at the Annual Meeting of shareholders of the Company to be held on
April 24, 1997 and at any and all adjournments thereof.
THE PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
the members of which have an interest in certain of the matters to be voted on
at the meeting. This proxy will be voted as directed here; HOWEVER,IF NOT
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR PROPOSALS 1, 2 AND 3.
Where stock is registered jointly in the name of two or more persons, ALL should
sign. Please sign, date and return promptly in the enclosed envelope. No postage
need be affixed if mailed in the United States.
(Continued, and to be marked, dated and signed, on the other side)
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o FOLD AND DETACH HERE o
<PAGE> 15
<TABLE>
<CAPTION>
Please mark |X|
your votes as
Indicated in
this example
<S> <C> <C>
THE BOARD OF DIRECTORS RECOMMEND A VOTE FOR
ITEMS 1, 2 AND 3.
ITEM 1 - ELECTION OF DIRECTORS FOR WITHHELD ITEM 2 - APPOINTMENT OF FOR AGAINST ABSTAIN
Nominees: FOR ALL COOPERS & LYBRAND, L.L.P. AS
Jerrald R. Goldman, MD |_| |_| public auditors for the |_| |_| |_|
George H. Hollidge calendar year 1997.
Kikuo Nakahara
Shirley W. Nelson ITEM 3 - In their discretion, |_| |_| |_|
Thomas H. State on such other matters as
Mary C. Warren may properly come before
Barbara J. Williams the meeting.
WITHHELD FOR: (Write that nominee's
name in the space provided below):
- ------------------------------
Continued on the reverse side . . .
Signature(s) _______________________________________________________________ Date _____________________
Print Name(s) ______________________________________________________________ Date _____________________
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o FOLD AND DETACH HERE o
</TABLE>
