SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. __)
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
[X] Definitive Proxy Statement Commission Only (as permitted by
[ ] Definitive Additional Materials Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
FIRST FINANCIAL BANCORP
----------------------------------------------------------
(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 transactions applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing party:
(4) Date filed:
<PAGE>
FIRST FINANCIAL BANCORP
701 South Ham Lane
Lodi, California 95242
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON
APRIL 25, 2000
TO EACH SHAREHOLDER OF
FIRST FINANCIAL BANCORP:
You are invited to attend the Annual Meeting of Shareholders of First
Financial Bancorp, a California corporation (the "Company"), which will be held
at the Company's executive offices, 701 South Ham Lane, Lodi, California 95242,
on Tuesday, April 25, 2000, at 5:30 p.m., Pacific Daylight Time, for the
following purposes:
1. To elect a Board of eight directors to serve until the next annual
meeting of shareholders or until their successors are elected and
qualified. The names of the nominees to be presented for election are
set forth in the accompanying Proxy Statement.
2. To transact such other business as may properly be brought before the
meeting or any adjournment or postponement thereof.
Section 2.05 of the Bylaws of the Company, as amended, provides as
follows:
"Nominations for election to the Board of Directors may be
made by the Board of Directors or by any shareholder entitled
to vote for the election of directors. Nominations, other than
those made by the Board of Directors, shall be made in writing
and shall be delivered or mailed, with first-class United
States mail postage prepaid, to the Secretary not less than 20
days nor more than 50 days prior to any meeting of
shareholders called for the election of directors; provided,
however, that if less than 25 days' notice of the meeting is
given to the shareholders, such nomination shall be mailed or
delivered to the Secretary not later than the close of
business on the seventh day following the day on which the
notice of the meeting was mailed. Shareholder nominations
shall contain the following information: (a) the name, age,
business address and, if known, residence address of each
proposed nominee; (b) the principal occupation or employment
of each proposed nominee; (c) the total number of shares of
capital stock of the Corporation that are beneficially owned
by each proposed nominee and by the nominating shareholder;
(d) the name and residence address of the notifying
shareholder; and (e) any other information the Corporation
must disclose regarding director nominees in the Corporation's
proxy solicitation. Nominations not made in accordance with
this Section may be disregarded by the Chairman of the
meeting, and if the Chairman so instructs, the inspectors of
election may disregard all votes cast for each such nominee."
<PAGE>
Only shareholders of record at the close of business on March 29, 2000,
are entitled to notice of, and to vote at, the meeting. In order to ensure your
representation, please complete, sign and date the enclosed proxy as promptly as
possible and return it in the enclosed envelope. If you attend the meeting and
wish to vote in person, your proxy will not be used.
By Order of the Board of Directors,
Leon Zimmerman
President and Chief Executive Officer
Lodi, California
March 30, 2000
<PAGE>
FIRST FINANCIAL BANCORP
701 South Ham Lane
Lodi, California 95242
PROXY STATEMENT
MARCH 30, 2000
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of First Financial Bancorp, a California
corporation (the "Company"), for the annual meeting of shareholders of the
Company, to be held on Tuesday, April 25, 2000, at 5:30 p.m., Pacific Time, at
the Company's executive offices, 701 South Ham Lane, Lodi, California 95242, and
any adjournment or postponement thereof (the "Annual Meeting"). The purposes of
the meeting are set forth in the Notice of Annual Meeting of Shareholders to
which this Proxy Statement is attached. The Company anticipates mailing this
Proxy Statement and form of proxy to its shareholders on or about April 5, 2000.
The cost of this solicitation will be paid by the Company. The
solicitation of proxies will be made primarily by use of the mails. In addition,
directors, officers and regular employees of the Company may make solicitations
by telephone, facsimile or personal interviews, and may request banks, brokers,
fiduciaries and other persons holding stock in their names, or in the names of
their nominees, to forward proxies and proxy materials to their principals and
obtain authorization for the execution and return of such proxies to management.
The Company will reimburse such banks, brokers and fiduciaries for their
out-of-pocket expenses incurred in connection therewith.
A proxy for use at the Annual Meeting is enclosed. Any proxy given may
be revoked by a shareholder at any time before it is exercised by filing with
the Secretary of the Company a notice in writing revoking it or by duly
executing a proxy bearing a later date. Proxies may also be revoked by any
shareholder present at the Annual Meeting who expresses a desire to vote such
shares in person. Subject to such revocation, all proxies duly executed and
received prior to or at the time of the Annual Meeting will be voted in
accordance with the instructions on the proxy. If no specification is made,
proxies will be voted in the election of directors "FOR" the nominees of the
Board of Directors, and, at the proxyholders' discretion, on such other matters,
if any, which may come before the meeting (including any proposal to postpone or
adjourn the meeting).
OUTSTANDING SHARES AND VOTING RIGHTS
There were issued and outstanding 1,445,034 shares of the Company's
common stock, no par value (the "Common Stock"), on March 29, 2000, which has
been set as the record date (the "Record Date") for the purpose of determining
the shareholders entitled to notice of, and to vote at, the Annual Meeting.
The presence in person or by proxy of a majority of the shares entitled
to vote is necessary to constitute a quorum at the Annual Meeting. Abstentions
and broker non-votes will be counted for purposes of determining the presence or
absence of a quorum. "Broker non-votes" are shares held by brokers or nominees
who are present in person or represented by proxy, but which are not voted on a
particular matter because under applicable rules the broker cannot vote on the
matter in the absence of instructions from the beneficial owner. The effect of
abstentions and broker non-votes on the calculation of the required vote on
specific proposals to be brought before the Annual Meeting is discussed under
each proposal, where applicable.
On any matter submitted to a shareholder vote, each holder of Common
Stock will be entitled to one vote, in person or by proxy, for each share of
stock outstanding in the holder's name on the books of the Company as of the
Record Date. For the election of directors, each shareholder has cumulative
voting rights. Cumulative voting rights entitle each shareholder to cast that
number of votes which equals the number of shares held by such shareholder,
multiplied by the number of directors to be elected. Each shareholder may cast
all his or her votes for a single candidate or may distribute his or her votes
among any or all of the
<PAGE>
candidates as he or she chooses. In order for a shareholder to cumulate votes,
the nominee's name must be placed in nomination prior to the voting and the
shareholder desiring to cumulate votes must give notice at the Annual Meeting
prior to the voting of the shareholder's intention to cumulate votes. If any
shareholder has given such notice, all shareholders may cumulate their votes.
The proxy holders are given discretionary authority under the terms of the proxy
to cumulate votes with respect to shares for which they hold a proxy.
PRINCIPAL SHAREHOLDERS
As of March 29, 2000, no individual known to the Company owned
beneficially or of record more than five percent (5%) of the outstanding shares
of its Common Stock, except as described below:
Title or Name and Address of Number of Shares Percentage
Class Principal Owner Beneficially Owned Owned
- ----- --------------- ------------------ -----
Common Weldon D. Schumacher 115,647 (1) 8.00%
Stock 1303 Rivergate Drive
Lodi, CA 95240
Common Raymond H. Coldani 89,557 (2) 6.20%
Stock 13199 N. Ray Road
Lodi, CA 95242
Common Leon J. Zimmerman 83,128 (3) 5.75%
Stock 701 S. Ham Lane
Lodi, CA 95242
Common Bank of Lodi, Employee 144.309 (4) 9.99%
Stock Stock Ownership Plan (ESOP)
701 South Ham Lane
Lodi, CA 95242
- --------------
(1) Includes 2,713 shares owned by Dr. Schumacher's wife, 93,461 shares held as
community property and 540 shares subject to options that are exercisable
as of March 29, 2000, or become exercisable within 60 days thereafter.
(2) Includes 16,871 shares owned by Mr. Coldani's wife and 61,062 shares held
as joint tenants.
(3) Includes 3,917 shares owned by Mr. Zimmerman's wife, 15,404 shares held in
trust by Mr. Zimmerman and his wife, and 46,350 shares subject to options
that are exercisable as of March 29, 2000, or become exercisable within 60
days thereafter.
(4) Shares of Common Stock beneficially owned by the ESOP are allocated on an
annual basis among ESOP participants. The Board of Directors of the Company
has authority to appoint Trustees of the ESOP. The Trustees possess
authority to manage all of the assets of the ESOP. As of the Record Date,
Messrs. Goebring, Anagnos and Coldani served as Trustees and Administrative
Committee members of the ESOP.
2
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS OF THE COMPANY
The Bylaws provide that the Company's Board of Directors shall consist
of not less than eight nor more than fifteen directors, the exact number to be
determined by the Board from time to time. The authorized number of directors to
be elected at the Annual Meeting is eight. The term of office for each director
extends until the next annual meeting and until his or her successor, as set by
the Board, is elected and qualified.
Shares represented by properly executed proxies will be voted, if
authority to do so is not withheld, for the election of the eight nominees named
below, subject to the proxyholders' discretionary power to cumulate votes. Votes
withheld and broker non-votes as to one or more or all nominees have no legal
effect, although such votes will be counted as shares that are present for
purposes of determining the presence of a quorum. The eight nominees receiving
the highest number of affirmative votes of the shares entitled to be voted for
them shall be elected as directors. Instructions on the proxy to withhold
authority to vote for one or more of the nominees will result in such nominees
receiving fewer affirmative votes. If any of the Board of Directors' nominees is
unable or declines to serve as a director at the time of the Annual Meeting, the
proxy will be voted for any nominee who shall be designated by the present Board
of Directors to fill the vacancy.
<TABLE>
The following table sets forth certain information with respect to
those persons nominated by the Board of Directors of the Company for election as
directors, as well as all directors and executive officers as a group. All of
the shares shown in the following table are owned both of record and
beneficially except as indicated in the notes to the table. There is no family
relationship between any of the directors or executive officers. The Company has
only one class of shares, Common Stock, outstanding.
3
<PAGE>
<CAPTION>
Common Stock Beneficially
Owned as of March 29, 2000
--------------------------
Number of
Name Age Position with Company Shares Percent
---- --- --------------------- ------ -------
<S> <C> <C> <C>
Incumbent Nominees:
Benjamin R. Goehring (a,b,c,d) 68 Chairman of the Board 36,391(1) 2.52%
of Directors
Weldon D. Schumacher (a,b,d) 64 Vice Chairman of the 115,647(2) 8.00%
Board of Directors
Angelo J. Anagnos (b,c,d) 65 Director 27,348(3) 1.89%
Steven M. Coldani (c) 47 Director 20,207(4) 1.40%
Bozant Katzakian (c,d) 85 Director 46,504(5) 3.22%
David M. Philipp (b) 37 Director 32,115(6) 2.22%
Leon J. Zimmerman (a,c,d) 57 Director, President and 83,128(7) 5.75%
Chief Executive Officer
New Nominees:
Robert H. Daneke 46 Director, Chief Credit 2,100(8) --
Officer
All directors and executive officers 382,549(9)
26.47%
as a group (10 persons)
<FN>
- -------------------------------
(a) Member of the Executive Committee
(b) Member of the Audit Committee and the Compensation and Stock Option Committee
(c) Member of the Loan and Investment Committee
(d) Member of the Marketing Committee
- -------------------------------
(1) Includes 11,596 shares owned by Mr. Goehring's wife, 950 shares owned by
Mr. Goehring in joint tenancy with his children, and 4,860 shares subject
to options that are exercisable as of March 29, 2000 or become exercisable
within 60 days thereafter.
(2) Includes 2,713 shares owned by Dr. Schumacher's wife, 93,461 shares held as
community property and 540 shares subject to options that are exercisable
as of March 29, 2000 or become exercisable within 60 days thereafter.
(3) Includes 7,948 shares owned by Mr. Anagnos' wife and 4,860 shares subject
to options that are exercisable as of March 29, 2000 or become exercisable
within 60 days thereafter.
(4) Includes 4,088 shares held as community property by Mr. Coldani and his
wife, 113 shares held as joint tenants by Mr. Coldani and his wife, 1,380
shares held as custodian for minor children, and 1,000 shares subject to
options that are exercisable as of March 29, 2000 or become exercisable
within 60 days thereafter.
4
<PAGE>
(5) Includes 41,644 shares held in trust by Mr. Katzakian and his wife as
trustees and 4,860 shares subject to options that are exercisable as of
March 29, 2000 or become exercisable within 60 days thereafter.
(6) Includes 1,168 shares owned by Mr. Philipp's wife, 102 shares held as
custodian for minor children, and 1,000 shares subject to options that are
exercisable as of March 29, 2000 or become exercisable within 60 days
thereafter.
(7) Includes 3,933 shares owned by Mr. Zimmerman's wife, 15,404 shares held in
trust by Mr. Zimmerman and his wife, and 46,350 shares subject to options
that are exercisable as of March 29, 2000, or become exercisable within 60
days thereafter.
(8) Includes 1,600 shares subject to options that are exercisable as of March
29, 2000, or become exercisable with 60 days thereafter.
(9) Officers included in this total are the President and Chief Executive
Officer; the Executive Vice President and Chief Credit Officer; Senior Vice
President and Chief Financial Officer; and the Senior Vice President and
Operations Administrator--in each case of the Company and the Bank. Shares
include 65,070 shares subject to options that are exercisable as of March
29, 2000 or become exercisable within 60 days thereafter.
</FN>
</TABLE>
The following is a brief description of the business experience of each
nominee.
BENJAMIN R. GOEHRING was appointed Chairman of the Board of Directors
of the Bank in February, 1996 and Chairman of the Board of Directors of the
Company in April, 1996. He is President of T&G Technologies, Inc., and was
formerly the President and principal shareholder of Goehring Meat, Inc., a meat
processing concern headquartered in Lodi, California, prior to its sale to
Victor Fine Foods in 1988. He holds a Bachelor of Science degree from the
University of California. He is a member of many civic, fraternal and
professional organizations, and also serves on the board of directors for the
National Meat Association, the Mokelumne River School, and several environmental
companies.
WELDON D. SCHUMACHER, M.D. was appointed Vice Chairman of the Board of
the Bank and the Company in April, 1996. Dr. Schumacher has been engaged in the
private practice of medicine in Lodi, California, since 1968. He holds a
Bachelor of Arts degree from Loma Linda University, Loma Linda, California, and
a Doctor of Medicine degree from Loma Linda University School of Medicine. Dr.
Schumacher is active in a number of civic and professional organizations,
including the San Joaquin County Medical Society, California Medical
Association, American Medical Association, American Academy of Family Physicians
and the Lodi District Chamber of Commerce.
ANGELO J. ANAGNOS is an active investor and an owner/manager of various
real estate holdings. He owned Sunwest Liquors and Delicatessen in Lodi,
California from 1983 to 1998. He was also the previous owner of Payless Market
and Liquors in Lodi, California from 1957 to 1983. Mr. Anagnos is a member of a
number of fraternal and professional organizations including Lodi Elks Club,
Lodi Eagles, Order of Ahepa, Lodi Hellenic Society, and the Lodi District
Chamber of Commerce.
STEVEN M. COLDANI is a real estate broker and farmer. He is co-owner of
Coldani Realty Inc. in Lodi, California and co-owner of Graeagle Associates,
Realtors in Graeagle, California. He holds a Bachelor of Science degree from the
University of the Pacific School of Business. He is a director of Lodi Memorial
Hospital Foundation, Inc., a member of the Lodi and Plumas County Boards of
Realtors, San Joaquin County Farm Bureau, and the California Asparagus
Commission. Mr. Coldani is also a past president of the Lodi Board of Realtors
and a past director of the California Association of Realtors.
5
<PAGE>
BOZANT KATZAKIAN is a retired real estate broker and an investor. He
was Chairman of the Board of the Company from inception to April, 1996 and was
Chairman of the Board of the Bank from inception through February, 1995. He also
has served as Chairman of Delta Title Guaranty Co. and as a member of the Board
of Directors for Oceanic Financial Corporation in San Francisco and Old Republic
Title of San Francisco. Mr. Katzakian served eight years on the Lodi City
Council and was the Mayor of Lodi for three years. Mr. Katzakian was
instrumental in organizing the Lodi Area Crime Stoppers and served as its first
President. Mr. Katzakian has been active in, and is a past President of, the
Lodi Lodge of the Fraternal Order of Eagles, Lodi Lions Club, Lodi District
Chamber of Commerce, Lodi Board of Realtors, Lodi Grape Festival and National
Wine Show, Central Valley Division of California Cities, and District Seven
California Association of Realtors. Mr. Katzakian was also the 1968 Lodi
Outstanding Citizen of the Year, is a member of both the Realtors and United Way
Volunteer Hall of Fame, and past recipient of the Lions International Melvin
Jones Fellow Award.
DAVID M. PHILIPP is the Chief Financial Officer for, and an investor
in, Electronic Freight Exchange Corp. (EFX), a multimodal, multicarrier webbased
transportation exchange and shipping solution. Mr. Philipp is a CPA and was the
Chief Financial Officer for the Company and the Bank from April, 1992 to April,
1999. Prior to joining the Company and the Bank, he was the Budget Director and
Financial Analyst for a national retailer from 1990 to 1992 and he was with
KPMG, LLP from 1986 to 1990. Mr. Philipp lives with his wife and two sons in El
Dorado Hills, California.
LEON J. ZIMMERMAN joined the Company in April, 1990. He was promoted
from Executive Vice President and Chief Credit Officer of Bank of Lodi to
President and CEO in August of 1994. Mr. Zimmerman became President and CEO of
the Company effective August 1995. He lives in Lodi with his wife and has
resided and worked in the San Joaquin/Sacramento Valley since 1960, serving in
various banking capacities since 1962. Mr. Zimmerman serves on many community
boards and committees, including the Lodi Police Chaplaincy Association, San
Joaquin County Education Foundation, Chamber of Commerce - Economic Development
Task Force & Agribusiness Committees, LEED - Sacramento Steering Committee and
Lodi Grape Festival and Harvest Fair. He is an active member of Rotary, Sutter
Club, Independent Order of Odd Fellows and several other community groups.
ROBERT H. DANEKE joined the Company in December, 1999 bringing on board
22 years of banking experience. Prior to joining the Company, Mr. Daneke was
employed at Clovis Community Bank for the past eight years and was promoted to
Senior Vice President/Senior Credit Officer in 1997. In addition, his career has
included: seven years with the Correspondent Bank Division of Community Bank in
Redwood City and seven years with Bank of America Technology Banking Group. Mr.
Daneke holds a B.B.A. Degree in Finance from the University of Iowa. He is also
a graduate of Pacific Coast Banking School at the University of Washington and
the California Intermediate Banking School at the University of San Diego. He
has been President and Chairman of the Board for the Clovis District Chamber of
Commerce and has served on the Board of Directors for both the Clovis Kiwanis
Club and the Sequoia Council of Boy Scouts of America. Mr. Daneke has recently
purchased a home in the Lodi area where he will reside with his wife and two
children.
6
<PAGE>
Committees of the Board of Directors
In order to facilitate the handling of various functions of the Board
of Directors, the Board has appointed several standing committees, including an
Executive Committee, an Audit Committee, a Loan and Investment Committee, a
Marketing Committee, and a Compensation and Stock Option Committee. The regular
meetings of the Loan and Investment, Audit and Marketing Committees are held
jointly each month. The Board of Directors of the Bank has similar committees.
Membership of these committees is the same for the Company and the Bank. The
members of such committees are set forth above in the table under "ELECTION OF
DIRECTORS OF THE COMPANY."
The Board of Directors has not established a nominating committee or
similar committee. The Board of Directors has approved the nominees listed above
as candidates for election as directors. Nominees for election to the Board of
Directors may also be nominated by shareholders, pursuant to the procedures set
forth in the Company's Bylaws and in the Notice of Annual Meeting of
Shareholders to which this Proxy Statement is attached.
The Executive Committee meets from time to time as necessary and, while
the Board is not in session, possesses all the powers and may exercise all the
duties of the Board of Directors in the management of the business of the
Company which may, by law, be delegated to it by the Board of Directors. The
Executive Committee met two times during 1999.
The Audit Committee is empowered to (i) meet with the independent
auditors of the Company and review the scope of the annual audit, any open
questions as to the choice of acceptable accounting principles to be applied and
all other matters relating to the auditors' relationship with the Company, (ii)
advise and assist the Board in evaluating the auditors' performance, including
the scope and adequacy of the auditors' examination, (iii) nominate, with the
approval of the Board, the firm of independent auditors to be submitted to the
shareholders of the Company for ratification at the annual meeting thereof, if
such submission is deemed desirable by the Board, (iv) review the Company's
annual financial statements and discuss such statements with the auditors prior
to their release, (v) receive and consider the auditors' comments and
suggestions as to the internal audit and control procedures, adequacy of staff
and other matters, (vi) perform such other functions and undertake such
investigations relating to the financial accounting aspects of the Company as
the Board may direct, and (vii) retain and consult with counsel or other experts
as the Committee may consider necessary or appropriate in the discharge of its
duties. The functions of the Committee are limited to the foregoing and do not
include normal management functions concerning accounting or auditing practices.
The Audit Committee met twelve times during 1999 on a joint basis with the Loan
and Investment and Marketing Committees.
The Loan and Investment Committee is authorized and empowered to (i)
establish investment and loan policies, (ii) establish individual investment and
loan limits, (iii) supervise and administer the investment and loan function,
(iv) undertake such other functions as the Board may from time to time direct.
The Loan and Investment Committee met twelve times on a joint basis with the
Audit and Marketing Committees and twelve times on a separate basis during 1999.
The Marketing Committee is empowered to oversee and guide the efforts
of the Company with respect to (i) cultivating and promoting the Company's
position within the community, (ii) the marketing of products and services, and
(iii) the discharge of responsibilities with respect to the Community
Reinvestment Act. The Marketing Committee met six times on a joint basis with
the Loan and Investment Committee and the Audit Committee during 1999.
The Compensation and Stock Option Committee is authorized and empowered
to investigate and recommend to the Board (i) the compensation to be paid to
executive officers of the Company and the Bank, (ii) the amount of any bonus
under the terms of any contract of employment between the Company or the Bank
and any executive officer, (iii) employee benefit plans deemed appropriate for
the employees of the Company and the Bank, (iv) supervise the administration of
any such employee benefit plans adopted by the Company and the Bank and (v)
undertake such other investigations and perform such other functions as the
Board may from time to time direct. The Compensation and Stock Option Committee
met one time during 1999.
7
<PAGE>
The Board of Directors of the Bank held twelve regular meetings and one
special meeting during 1999. The Board of Directors of the Company held seven
regular meetings and five special meetings during 1999. No director attended
fewer than 75% of the total number of meetings of the Boards and the committees
on which he served during 1999.
Compensation of Directors
During 1999, fees totaling $121,500 and $8,000 were paid to the
Directors for attending meetings of the Bank's Board of Directors and the
Company's Board of Directors, respectively. Each Director received $650 for each
Bank Board meeting, $600 for each joint Bank Audit, Loan, and Marketing
Committee meeting attended, and $300 for each individual Bank committee meeting
attended outside of the joint committee meeting schedule. Each director received
$650 for each special Company Board meeting attended. The Chairman of the Board
of Directors of the Bank was paid $850 for each Bank Board meeting attended.
Each Committee Chairman was paid an additional $100 for each joint Bank Audit,
Loan, and Marketing Committee meeting attended and $400 for each individual Bank
committee meeting attended outside of the joint committee meeting schedule.
The Directors have also received options to purchase shares of the
Company's Common Stock pursuant to the automatic grant features of the 1991
Director Stock Option Plan. For more information, see the discussion of the 1991
Director Stock Option Plan under "Change in Control Arrangements--1991 Stock
Option Plans" herein.
Effective April 3, 1998, the Company and the Bank established a
director emeritus program (the "Director Emeritus Program") for retired members
of the Board of Directors. Any Director who has served continuously for at least
ten years as a Director of the Company or the Bank prior to retirement is
eligible to be granted the status of "Director Emeritus" under the Director
Emeritus Program. A Director Emeritus is required to (a) represent the goodwill
of the Company and the Bank in the community, (b) promote the continued
profitability of the Company and the Bank, (c) maintain communication and meet
periodically with the President and the Chairman, (d) provide consultation in
his field of expertise, and (e) comply with the Company's policies applicable to
the activities of a Director Emeritus. A Director Emeritus does not have the
status of a Director of the Company or the Bank and is not entitled to attend or
vote at any meetings of the Board of Directors or committees of the Board of
Directors. The term of any Director Emeritus is three years. No fees or other
compensation will be paid to a Director Emeritus, although any such person with
a Director Supplemental Compensation Agreement will be eligible for annual
payments totaling $7,500 during each of the first three years of service as a
Director Emeritus (for more information regarding such payments, see the
discussion of Director Supplemental Compensation Agreements under "Supplemental
Compensation Agreements" below).
During 1998, each member of the Board of Directors became entitled to
certain fringe benefits, payable upon death, disability or retirement and upon
early termination of service as a Director due to a change in control or certain
other events other than voluntary resignation, pursuant to the terms of
individual Director Supplemental Compensation Agreements and Life Insurance
Endorsement Method Split Dollar Plan Agreements signed with the Bank. Said
Agreements were made effective as of April 3, 1998, the premium date of
single-premium life insurance policies purchased by the Bank on the lives of
certain executive officers and directors. For more information, see the
discussion of Director Supplemental Compensation Agreements under "Supplemental
Compensation Agreements" below.
The Company maintains a salary continuation plan (see "Salary
Supplemental Compensation Agreements" on page 10) for its executive officers,
certain senior officers and its directors. As of December 31, 1999, the
Company's non-employee directors were credited with $49,000 in accrued benefits
under the directors' salary continuation plan. The Company allocated $26,000 to
the Salary Continuation Plan in 1999 on behalf of its non-employee directors.
8
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
<TABLE>
The following table sets forth, for each of the last three fiscal
years, the compensation of Leon J. Zimmerman, President and Chief Executive
Officer of the Company and the Bank. No other executive officer of the Company
or the Bank received for the fiscal year ended December 31, 1999 annual salary
and bonus exceeding $100,000.
<CAPTION>
Long-Term Compensation
-------------------------------
Annual Compensation Awards Payouts
---------------------------------------------- -------------------- -------
Restricted
Other Annual Stock LTIP All Other
Year Salary (1) Bonus Compensation (2) Award(s) Options Payouts Compensation (3)
---- ---------- ------- ---------------- -------- ------- ------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Leon J. Zimmerman:
1999 $147,000 $ 4,000 -- -- -- -- $9,953
1998 $140,000 $22,531 -- -- -- -- $7,924
1997 $128,750 $12,500 -- -- -- -- $5,081
<FN>
- ----------------------------
(1) Amounts shown for each year include compensation earned and received as
well as amounts earned but deferred at the officer's election.
(2) Mr. Zimmerman did not receive perquisites or other personal benefits in
excess of the lesser of $50,000 or 10% of his total annual salary and bonus
during 1999, 1998 and 1997.
(3) All other compensation includes contributions to the Bank of Lodi Employee
Stock Ownership Plan (see description herein below) and matching
contributions to the Company's 401(k) Profit Sharing Plan. All other
compensation does not include the value of certain benefits payable to Mr.
Zimmerman pursuant to Executive Supplemental Compensation Agreements and
Life Insurance Endorsement Method Split Dollar Plan Agreements, entered
into between the Bank and Mr. Zimmerman, dated as of April 3, 1998 (to
coincide with the premium date of single-premium life insurance policies
purchased by the Bank on his life), upon death, retirement or termination
of employment without cause (for more information, see the discussion of
Executive Supplemental Compensation Agreements under "Supplemental
Compensation Agreements" hereinbelow).
</FN>
</TABLE>
9
<PAGE>
Employment Agreements
Leon J. Zimmerman, President and Chief Executive Officer of the Company
and the Bank, entered into an Employment Agreement with the Company, effective
September 30, 1998, for a one year term ending April 30, 1999, subject to
automatic extensions for additional one-year periods and also subject to certain
early termination provisions. The Agreement provides for a base salary of
$140,000 per annum, with increases effective on the 1st of January each year,
commencing with January 1, 1999, at the sole discretion of the Board of
Directors based upon a review of his performance during the previous year and
competitive factors. Such salary includes Mr. Zimmerman's service on the Board
of Directors of the Company and the Bank. The Agreement also provides that Mr.
Zimmerman shall participate in any officer bonus plan and he is entitled to the
same group insurance plans and other benefits made available to employees
generally, plus the use of an automobile. The Company may immediately terminate
the Agreement if the termination is for cause. The Company may also terminate
the Agreement without cause by giving Mr. Zimmerman thirty (30) days' written
notice. In the event the Company terminates Mr. Zimmerman's employment without
cause, Mr. Zimmerman will be entitled to receive as severance compensation an
amount equal to twelve months' salary. Upon a change in control, or if Mr.
Zimmerman is terminated after a change in control or he voluntarily terminates
his employment within two years after a change in control in response to a
constructive termination, Mr. Zimmerman will be entitled to receive as severance
compensation an amount equal to two times his average annual compensation for
the two years immediately preceding the change in control. For purposes of the
Agreement, "change in control" means a change in control of the Company of a
nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A (or in response to any similar item on any
similar schedule or form) promulgated under the Securities Exchange Act. A
"constructive termination" is defined by the Agreement to include a material
reduction in base salary, a material change in responsibilities, or a
requirement to relocate.
Supplemental Compensation Agreements
Effective April 3, 1998 the Bank entered into a Supplemental
Compensation Agreement ("SCA") with Leon J. Zimmerman, President and Chief
Executive Officer of the Company and the Bank, and with the Directors of the
Company and the Bank. Each SCA provides lifetime income benefits of $7,500 per
annum as well as a death benefit to the participant. At the same time, the Bank
has invested in single-premium life insurance policies written on the lives of
the certain senior officers and directors. The Bank is the designated
beneficiary on all of the policies. The policies were purchased in order to
indirectly offset the anticipated costs of benefits payable pursuant to the
SCA's. The Bank also entered into a Life Insurance Endorsement Method Split
Dollar Plan Agreement with certain senior officers and directors in order to
provide for the division of death proceeds of such policies as between the Bank
and the designated beneficiary(ies).
Executive Supplemental Compensation Agreements. Each Executive SCA
provides for the payment of certain benefits upon retirement (age 62 or older)
or early retirement (prior to attaining age 62), upon death or disability prior
to retirement, or in the event employment is terminated prior to retirement. If
the employment of the executive is terminated prior to the executive attaining
age 62, other than by reason of death disability or retirement, then the
entitlement of the executive to the benefits specified in his Executive SCA will
depend on whether the executive is terminated (i) without cause, or on account
of or after a change in control of the Bank, in which case the designated
benefits will be payable, or (ii) with cause, or by voluntary resignation of the
executive prior to 100 percent vesting of his benefits, in which case all rights
and benefits will be forfeited.
For Leon J. Zimmerman, the benefits designated in his Executive SCA
were 80% vested on April 2, 1999, and will be 100% vested on April 2, 2000. Mr.
Zimmerman will be entitled to receive a projected benefit under his Executive
SCA that is equal to 46% of his 1999 total compensation at his normal retirement
age of 62.
10
<PAGE>
Director Supplemental Compensation Agreements. Each Director SCA provides for
the payment of certain benefits, commencing after the expiration of the initial
three year period as Director Emeritus following retirement from the Board of
Directors of the Bank, and continuing until the Director's death. During service
as Director Emeritus, he will also be entitled to receive certain payments
during the three-year period commencing on his retirement date from the Board of
Directors. Each Director SCA further provides for the payment of certain
benefits in the event the Director becomes disabled while serving on the Board
of Directors of the Bank, which benefits will continue until the Director's
death, and certain other benefits in the event the service of the Director is
terminated, other than by reason of death, disability or retirement, prior to
age 65, which benefits depend on whether his service is terminated (i) without
cause, or on account of or after a change in control of the Bank, in which case
the designated benefits will be payable, or (ii) with cause, or by voluntary
resignation of the Director prior to 100 percent vesting of his benefits, in
which case all rights and benefits will be forfeited. All current directors are
fully vested in these benefits.
The benefits are defined in each Director SCA. Upon a Director's
retirement, and assuming that he serves as a Director Emeritus, the Bank will
pay to the Director the sum of $7,500 per year for the first three years of such
service. In any event, commencing on the third anniversary of the Director's
retirement, the Bank will pay to the Director the sum of $7,500 per year,
continuing until the Director's death.
Aggregated Option Exercises in 1999 and Fiscal Year-end Option Values
<TABLE>
The following table sets forth information pertaining to options
exercised during the last fiscal year and unexercised options as of the end of
the last fiscal year for Leon J. Zimmerman, President and Chief Executive
Officer of the Company and the Bank:
<CAPTION>
Number of Value Realized Securities Underlying Value of Unrealized
Shares (Market Price at Number of Unexercised in-the-money
Acquired exercise less Options at FY-End Options at FY-End
on Exercise exercise price) Exercisable Unexercisable Exercisable Unexercisable
----------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Leon J. Zimmerman:
-- -- 46,350 -- $171,337.50 --
</TABLE>
Transactions with Management
During 1999, certain directors and officers of the Company and the Bank
had loans outstanding with the Bank. Such loans were made in the ordinary course
of business on substantially the same terms, including interest rate and
collateral, as those prevailing at the time for comparable transactions with
other persons, and did not involve more than the normal risk of collectibility
or present other unfavorable features.
There are no existing or proposed material interests or transactions
between the Company and any of its executive officers or directors.
Change in Control Arrangements
Employment Contract. Upon a change in control, or if Mr. Zimmerman is
terminated after a change in control or he voluntarily terminates his employment
within two years after a change in control in response to a constructive
termination, Mr. Zimmerman will be entitled to receive as severance compensation
an amount equal to two times his average annual compensation for the two years
immediately preceding the change in control. For purposes of the Agreement,
"change in control" means a change in control of the Company of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A (or in response to any similar item on any similar schedule or
form) promulgated under the Securities Exchange Act. A "constructive
termination" is defined by the Agreement to include a material reduction in base
salary, a material change in responsibilities, or a requirement to relocate.
11
<PAGE>
1991 Stock Option Plans. On February 19, 1991, the Board of Directors
adopted (i) the First Financial Bancorp 1991 Employee Stock Option Plan (the
"Employee Stock Option Plan"), under which officers and key full-time salaried
employees of the Company and its subsidiaries may be granted options to purchase
shares of the Company's Common Stock; and (ii) the First Financial Bancorp 1991
Director Stock Option Plan (the "Director Stock Option Plan"), under which
members of the Board of Directors are granted options to purchase shares of the
Company's Common Stock. At the 1991 Annual Meeting, the shareholders approved
the adoption of the Employee Stock Option Plan and the Director Stock Option
Plan (collectively referred to as the "1991 Stock Option Plans"). The 1991 Stock
Option Plans are intended to further the growth, development and financial
success of the Company and its subsidiaries by providing additional incentives
to members of the Board of Directors, officers and key employees, and by
assisting them in acquiring shares of the Company's Common Stock, which will
allow them to benefit directly from the Company's growth, development and
financial success. The Director Stock Option Plan was amended at the 1995 annual
meeting of shareholders in respect of the timing of option grants. Section 5(a)
of the Director Stock Option Plan, as amended, provides that, on May 1, 1995,
each person who is an eligible Board member and who has continuously served on
the Board since June 18, 1991, shall be granted an option to purchase 3,150
shares of Common Stock. Accordingly, on May 1, 1995, each of the Directors of
the Company (including six of the nominees described in this Proxy Statement)
was granted a nonstatutory option for 3,150 shares of Common Stock.
The Board of Directors of the Company adopted a new, 1997 Stock Option
Plan and the shareholders approved such Plan at the annual meeting held on April
22, 1997. No additional option grants will be made under the 1991 Stock Option
Plans after such date. Such discontinuance will not adversely affect any stock
option previously granted and outstanding under the 1991 Stock Option Plans.
1997 Stock Option Plan. On March 20, 1997, the Board of Directors
adopted the First Financial Bancorp 1997 Stock Option Plan (the "1997 Stock
Option Plan"), under which directors, officers and key full-time salaried
employees of the Company and its subsidiaries and any consultant to the Company
and its subsidiaries who is not a member of the Board of Directors may be
granted options to purchase shares of the Company's Common Stock. At the 1997
Annual Meeting, the shareholders approved the adoption of the 1997 Stock Option
Plan. The 1997 Stock Option Plan is intended to further the growth, development
and financial success of the Company and its subsidiaries by providing
additional incentives to members of the Board of Directors, officers and key
employees and consultants.
Change in Control. In the event of a sale, dissolution or liquidation
of the Company or a merger or consolidation in which the Company is not the
surviving or resulting corporation, the Board has the power to cause the
termination of options which are then outstanding under the Company's 1991 Stock
Option Plans if the surviving or resulting corporation does not agree to assume
all outstanding options under such plans; provided, however that in such event
the optionees shall have the right prior to such sale, liquidation, dissolution,
merger or consolidation to notification thereof as soon as practicable and,
thereafter until three days prior to the effectiveness of such sale,
dissolution, liquidation, merger or consolidation, to exercise the option
without regard to the vesting provisions. This right is conditioned upon the
execution of a definitive agreement of merger or consolidation or final plan of
sale, liquidation, or dissolution. Under the 1997 Stock Option Plan, in the
event of a change in control of the Company, the outstanding options will be
subject to the terms of the agreement of merger or reorganization. Such an
agreement may provide for the assumption of outstanding options, for payment of
a cash settlement or for acceleration of exercisability, in all cases without
the consent of the optionees.
12
<PAGE>
Employee Stock Ownership Plan
Effective January 1, 1992, the Company and the Bank established the
Bank of Lodi Employee Stock Ownership Plan. The plan covers all employees, age
21 or older, beginning with the first plan year in which the employee completes
at least 1,000 hours of service. The Bank's annual contributions to the plan are
made in cash and are at the discretion of the Board of Directors based upon a
review of the Company's consolidated profitability. Contributions to the plan
are invested primarily in the common stock of the Company and are allocated to
participants on the basis of salary in the year of allocation. Benefits become
20% vested after the third year of credited service, with an additional 20%
vesting each year thereafter until 100% vested after seven years. The amount of
contributions for the benefit of Mr. Zimmerman is included in the Summary Cash
Compensation table in the column entitled "All Other Compensation."
Profit Sharing Plan
Effective January 1, 1997, the Company established the First Financial
Bancorp 401(k) Profit Sharing Plan. The plan covers all employees, age 18 or
older, beginning with the first plan year in which the employee completes at
least 1,000 hours of service. The plan is intended to supplement income upon
retirement; the actual retirement benefit for each employee will depend on the
amount in the employee's plan account balance at the time of retirement. For
each plan year, participating employees may elect to have a portion of their
compensation contributed to the plan, and the Company or the Bank may, at its
discretion, make matching or other contributions. Company and Bank contributions
to the plan for the benefit of employees become 20% vested after the second year
of service, with an additional 20% vesting each year thereafter until 100%
vested after six years. The amount of contributions for the benefit of Mr.
Zimmerman is included in the Summary Cash Compensation table in the column
entitled "All Other Compensation."
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and any person who owns more than
ten percent of the Company's Common Stock, to file with the Securities and
Exchange Commission (the "SEC") initial reports of ownership and reports of
changes in ownership of Common Stock of the Company. Directors, executive
officers and greater than ten percent shareholders, if any, are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file. To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, all directors and executive officers of the Company were
in compliance with the applicable Section 16(a) filing requirements. To the
Company's knowledge, during the fiscal year ended December 31, 1999, no person
owned more than ten percent of the Common Stock of the Company.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected KPMG LLP as the Company's certified
public accountants for 2000. KPMG LLP audited the financial statements of the
Company for the year ended December 31, 1999. KPMG LLP has no interest,
financial or otherwise, in the Company. The services rendered by KPMG LLP during
the 1999 fiscal year were audit services and included consultation in connection
with various accounting, tax reporting, strategic planning, and compensation
matters. The Audit Committee of the Board of Directors of the Company approved
each professional service rendered by KPMG LLP during the 1999 fiscal year, and
the possible effect of each such service on the independence of that firm was
considered by the Audit Committee of the Board of Directors before such service
was rendered.
A representative of KPMG LLP is expected to be present at the Annual
Meeting and will have an opportunity to make a statement and to respond to
appropriate questions.
13
<PAGE>
ANNUAL REPORT
The annual report of the Company containing audited financial
statements for the fiscal year ended December 31, 1999, has been combined with
the required information of the Annual Report on Form 10-K. The Company's
combined Annual Report on Form 10-K for the year ended December 31, 1999, as
filed with the SEC under the Securities Exchange Act of 1934, accompanies this
Proxy Statement.
SHAREHOLDERS' PROPOSALS FOR 2001 ANNUAL MEETING;
DISCRETIONARY VOTING
Any proposal of a shareholder intended to be presented at the Company's
2001 Annual Meeting must be received by the Company no later than November 30,
2000 for inclusion in the Proxy Statement and form of proxy for that meeting and
must meet the requirements of the SEC's proxy rules. Any such proposal should be
directed to the attention of the President, First Financial Bancorp, 701 South
Ham Lane, Lodi, California 95242. The proxy holders may vote in their discretion
all proxies solicited for the company's 2001 Annual Meeting on any matter raised
at that meeting of which the Company did not have notice by at least February
19, 2001.
OTHER MATTERS
Management knows of no other matters to be voted upon at the Annual
Meeting. If any other matter properly comes before the Annual Meeting, it is the
intention of the persons named in the enclosed form of proxy to vote on such
matters in accordance with their judgment.
You are urged to sign, date and return the enclosed proxy in the
envelope provided. No further postage is required if the envelope is mailed from
within the United States. If you subsequently decide to attend the Annual
Meeting and wish to vote your shares in person, you may do so. Your cooperation
in giving this matter your prompt attention is appreciated.
By Order of the Board of Directors,
Leon J. Zimmerman
President and Chief Executive Officer
Lodi, California
March 30, 2000
