SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of
the Commission Only (as
permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Comm Bancorp, 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] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
_______________________________________________________________
2) Aggregate number of securities to which transaction applies:
_______________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
_______________________________________________________________
4) Proposed maximum aggregate value of transaction:
_______________________________________________________________
5) Total fee paid:
_______________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
_____________________________________________
2) Form, Schedule or Registration Statement No.:
_____________________________________________
3) Filing Party:
_____________________________________________
4) Date Filed:
_____________________________________________
____________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 7, 1996
____________________________________
TO THE STOCKHOLDERS OF COMM BANCORP, INC:
Notice is hereby given that the Annual Meeting of Stockholders of COMM
BANCORP, INC. (the "Company") will be held at 1:00 p.m., prevailing time, on
Friday, June 7, 1996, at the American Legion Post #524, Dundaff Street, Forest
City, Pennsylvania 18421, for the following purposes:
1. To fix the number of directors to be elected at nine (9);
2. To elect nine (9) directors to serve for a one-year term and until
their successors are duly elected and qualified;
3. To ratify the selection of Kronick Kalada Berdy & Co. of Kingston,
Pennsylvania, Certified Public Accountants, as the independent
auditors for the Company for the year ending December 31, 1996; and
4. To transact such other business as may properly come before the
Annual Meeting and any adjournment or postponement thereof.
In accordance with the By-laws of the Company and action of the Board of
Directors, only those stockholders of record at the close of business on May 8,
1996, will be entitled to notice of and to vote at the Annual Meeting and at any
adjournment or postponement thereof.
Copies of the Company's Annual Report for the fiscal year ended December
31, 1995, are being mailed with this Notice. Copies of the Company's Annual
Report for the 1994 fiscal year may be obtained at no cost by contacting Scott
A. Seasock, Chief Financial Officer, Comm Bancorp, Inc., 521 Main Street, P.O.
Box 129, Forest City, Pennsylvania 18421, telephone: (717) 785-2181.
You are urged to mark, sign, date and promptly return your Proxy in the
enclosed envelope so that your shares may be voted in accordance with your
wishes and in order that the presence of a quorum may be assured. The prompt
return of your signed Proxy, regardless of the number of shares you hold, will
aid the Company in reducing the expense of additional Proxy solicitation. The
giving of such Proxy does not affect your right to vote in person, if you attend
the meeting and give written notice to the Secretary of the Company.
By Order of the Board of Directors,
/s/ William F. Farber, Sr.
William F. Farber, Sr.
Chairman of the Board
May 8, 1996
PROXY STATEMENT FOR THE ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD ON JUNE 7, 1996
GENERAL
Introduction, Date, Time and Place of Annual Meeting
____________________________________________________
This Proxy Statement is being furnished in connection with the
solicitation by the Board of Directors (the "Board") of COMM BANCORP, INC. (the
"Company"), a Pennsylvania business corporation, of Proxies to be voted at the
Annual Meeting of Stockholders of the Company to be held on Friday, June 7,
1996, at 1:00 p.m., prevailing time, at the American Legion Post #524, Dundaff
Street, Forest City, Pennsylvania 18421, and at any adjournment or postponement
of the Annual Meeting.
The principal executive offices of the Company are located at Community
Bank & Trust Company, 521 Main Street, P.O. Box 129, Forest City, Pennsylvania
18421. The telephone number for the Company is (717) 785-3181. All inquiries
should be directed to Scott A. Seasock, Chief Financial Officer of the Company.
Community Bank & Trust Company, a Pennsylvania banking institution (the "Bank"),
is a wholly-owned subsidiary of the Company.
Solicitation and Voting of Proxies
__________________________________
This Proxy Statement and the enclosed form of Proxy (the "Proxy") are
first being sent to stockholders of the Company on or about May 8, 1996.
Shares represented by Proxies on the accompanying Proxy, if properly
signed and returned, will be voted in accordance with the specifications made
thereon by the stockholders. Any Proxy not specifying to the contrary will be
voted: FOR the proposal to fix the number of Directors to be elected at nine
(9); FOR the election of the nine (9) nominees for Director named below; and FOR
the ratification of the selection of Kronick Kalada Berdy & Co., Certified
Public Accountants, as the independent auditors for the Company for the year
ending December 31, 1996. Execution and return of the enclosed Proxy will not
affect a stockholder's right to attend the Annual Meeting and vote in person,
after giving written notice to the Secretary of the Company. The cost of
preparing, assembling, printing, mailing and soliciting Proxies, and any
additional material which the Company may furnish stockholders in connection
with the Annual Meeting, will be borne by the Company. In addition to the use
of the mails, certain directors, officers and employees of the Company and the
Bank may solicit Proxies personally, by telephone, telegraph and
telecopier. Arrangements will be made with brokerage houses and other
custodians, nominees and fiduciaries to forward Proxy solicitation material to
the beneficial owners of stock held of record by these persons, and, upon
request thereof, the Company will reimburse them for their reasonable forwarding
expenses.
Revocability of Proxy
_____________________
A stockholder who returns a Proxy may revoke the Proxy at any time before
it is voted only: (1) by giving written notice of revocation to Michael T.
Goskowski, Secretary of Comm Bancorp, Inc., at 521 Main Street, P.O. Box 129,
Forest City, Pennsylvania 18421; (2) by executing a later-dated Proxy and giving
written notice thereof to the Secretary of the Company; or (3) by voting in
person after giving written notice to the Secretary of the Company.
Voting Securities, Record Date and Quorum
_________________________________________
At the close of business on May 8, 1996, the Company had issued and
outstanding 2,200,080 shares of common stock, par value $0.33 per share, the
only authorized class of stock (the "Common Stock").
Only holders of Common Stock of record at the close of business on May 8,
1996, will be entitled to notice of and to vote at the Annual Meeting.
Cumulative voting rights do not exist with respect to the election of directors.
On all matters to come before the Annual Meeting, each share of Common Stock is
entitled to one vote.
Under Pennsylvania law, the presence of a quorum is required for each
matter to be acted upon at the Annual Meeting. In accordance with Section 1756
of the Business Corporation Law of 1988, as amended, the presence, in person or
by Proxy, of stockholders entitled to cast at least a majority of the votes that
all stockholders are entitled to cast shall constitute a quorum for the
transaction of business at the Annual Meeting. Votes withheld will be counted
in determining the presence of a quorum for the particular matter. Broker non-
votes will not be counted in determining the presence of a quorum for the
particular matter as to which the broker withheld authority.
Assuming the presence of a quorum, the affirmative vote of a majority of
all votes cast by stockholders is required to approve the proposal to fix the
number of directors to be elected at nine. Votes withheld and broker non-votes
are not deemed to constitute "votes cast" and therefore do not count for or
against such proposal. Votes withheld and broker non-votes, however, have a
practical effect of reducing the number of affirmative votes required to achieve
a majority for such matter by reducing the total number of shares voted from
which the required majority is calculated.
Assuming the presence of a quorum, the nine (9) nominees for director
receiving the highest number of votes cast by stockholders entitled to vote for
the election of directors shall be elected. Votes withheld from a nominee and
broker non-votes will not be cast for such nominee.
Assuming the presence of a quorum, the affirmative vote of a majority of
all votes cast by stockholders is required for the ratification of the selection
of independent auditors. Votes withheld and broker non-votes are not deemed to
constitute "votes cast" and therefore do not count for or against such
ratification. Votes withheld and broker non-votes, however, have the practical
effect of reducing the number of affirmative votes required to achieve a
majority for each such matter by reducing the total number of shares voted from
which the required majority is calculated.
PRINCIPAL BENEFICIAL OWNERS OF THE COMMON STOCK
Principal Owners
________________
The following table sets forth, as of May 8, 1996, the name and address of
each person who owns of record or who is known by the Board of Directors to be
the beneficial owner of more than five percent of the outstanding Common Stock,
the number of shares beneficially owned by such person and the percentage of the
outstanding Common Stock so owned.
Percent of Outstanding
Shares Beneficially Common Stock
Name and Address Owned(1) Beneficially Owned
________________ ___________________ ______________________
Joseph P. Moore, Jr. 217,260(2) 9.88%
400 Williamson Road
Gladwyne, PA 19035
William F. Farber, Sr. 187,320 8.51%
Crystal Lake Road
R.R. 1, Box 1281
Carbondale, PA 18407
Gerald B. Franceski 155,478(3) 7.07%
Lewis Lake, P.O. Box 88
Union Dale, PA 18470
Robert T. Seamans 129,360(4) 5.88%
P.O. Box 462
Factoryville, PA 18419
(1) The securities "beneficially owned" by an individual are
determined in accordance with the definitions of "beneficial
ownership" set forth in the General Rules and Regulations of
the SEC and may include securities owned by or for the
individual's spouse and minor children and any other relative who
has the same home, as well as securities to which the individual
has or shares voting or investment power or has the right to
acquire beneficial ownership within sixty (60) days after
May 8, 1996. Beneficial ownership may be disclaimed as to
certain of the securities.
(2) Includes 30,240 shares held individually; 6,300 shares held in
the Moore Motors, Inc. Profit Sharing Plan; and 180,720 shares
held beneficially by Moore & Company, which are held in trust
for his various relatives.
(3) Includes 104,478 shares held jointly with his spouse; and 51,000
shares held jointly in various combinations with his spouse,
sons, brother, sister and aunt.
(4) Includes 128,025 shares held individually; and 1,335 shares held
individually by his spouse.
Beneficial Ownership by Officers, Directors and Nominees
________________________________________________________
The following table sets forth as of May 8, 1996, the amount and
percentage of the Common Stock beneficially owned by each director and all
officers and directors of the Company as a group.
NAME OF INDIVIDUAL AMOUNT AND NATURE OF PERCENT
OR IDENTITY OF GROUP BENEFICIAL OWNERSHIP(1)(2)(3) OF CLASS(4)
____________________ _____________________________ ___________
David L. Baker 11,304(5) ----
Donald R. Edwards, Sr. 51,816(6) 2.36%
William F. Farber, Sr. 187,320 8.51%
Judd B. Fitze 10,200(7) ----
Michael T. Goskowski 21,096(8) ----
John P. Kameen 20,280(9) ----
William B. Lopatofsky 25,410(10) 1.15%
J. Robert McDonnell 32,544(10) 1.48%
Joseph P. Moore, Jr. 217,260(11) 9.88%
Scott A. Seasock 2,745(12) ----
Thomas E. Sheridan 1,764(10) ----
Eric Stephens 6,960(13) ----
All Executive Officers and Directors
of the Company as a Group
(9 Directors, 6 Officers,
12 Persons in Total) 588,699 26.76%
(1) Does not include any Common Stock held in fiduciary accounts
under the control of the Trust Department of the Bank.
(2) See footnote (1) under the above caption entitled "Principal
Owners" for the definition of "beneficial ownership."
(3) Information furnished by the directors and the Company.
(4) Less than 1.0 percent unless otherwise indicated.
(5) See footnote (3) under the above caption entitled "Principal
Officers of the Company."
(6) Includes 1,200 shares held individually; 5,580 shares held
individually by his spouse; 900 shares held jointly with his
daughter; 43,920 shares held jointly by his spouse and daughter;
108 shares held under his IRA; and 108 shares held under his
spouse's IRA.
(7) Includes 1,200 shares held under his IRA; and 9,000 shares held
jointly with his spouse.
(8) See footnote (7) under the above caption entitled "Principal
Officers of the Company."
(9) Includes 17,280 held jointly with his spouse and 3,000 shares
held as tennants-in-common with other individuals.
(10) Held jointly with his spouse.
(11) See footnote (2) under the above caption entitled "Principal
Owners."
(12) See footnote (5) under the above caption entitled "Principal
Officers of the Company."
(13) Includes 5,340 shares held individually; 900 shares held
individually by his spouse; and 720 shares held individually by
his children.
ELECTION OF DIRECTORS
Unless otherwise instructed, the Proxyholders will vote the
Proxies received by them for the election of the nine (9) nominees named below.
If any nominee should become unavailable for any reason, Proxies will be voted
in favor of a substitute nominee as the Board of Directors of the Company shall
determine. The Board of Directors has no reason to believe that the nominees
named will be unable to serve if elected. Any vacancy occurring on the Board of
Directors of the Company for any reason may be filled by a majority of the
directors then in office until the expiration of the term of the vacancy.
Article 12 of the Amended Articles of Incorporation requires the
number of directors to be fixed and determined by a resolution of a majority of
the stockholders at any annual or special meeting of the stockholders. Unless
otherwise instructed, the Proxyholders will vote the Proxies received by them
for a resolution to fix the number of directors of the Company at nine (9).
In addition, there is no cumulative voting for the election of
directors. Each share of Common Stock is entitled to cast only one vote for
each nominee. For example, if a stockholder owns ten (10) shares of Common
Stock, he or she may cast up to ten (10) votes for each of the nine (9)
directors to be elected.
INFORMATION AS TO NOMINEES AND EXECUTIVE OFFICERS
The following table contains certain information with respect to
the nominees and executive officers:
AGE AS OF PRINCIPAL OCCUPATION FOR PAST DIRECTOR OF
MARCH 1, FIVE YEARS AND POSITION HELD COMPANY/
NAME 1996 WITH THE COMPANY AND BANK BANK SINCE
____ _________ _____________________________ ___________
David L. Baker 50 President and Chief Executive 1988/1993
Officer ("CEO") of the Company
and Bank (as of April 26, 1995);
Senior Vice President of the Bank
(as of January 20, 1993);
President of FNB Nicholson
(1987-1992) prior to its merger
with the Bank
Donald R. Edwards, Sr.(1) 52 Owner, Mountain View Inn 1988/1993
William F. Farber, Sr. 58 President, Farber's Restaurants; 1983/1970
Chairman of the Boards of Directors
of the Company and Bank
Judd B. Fitze 44 Partner, Farr, Davis & Fitze 1995/1992
(attorney-at-law)
Michael T. Goskowski(2) 73 President, Kartri Sales Mfg. 1984/1984
(manufacturing); Secretary of
the Company and Bank
John P. Kameen 54 Publisher, Forest City News 1983/1979
William B. Lopatofsky 64 Owner, Northeast Distributors 1983/1982
and Equipment
J. Robert McDonnell 60 Owner, McDonnell's Restaurant; 1983/1979
Vice President of the Company
Joseph P. Moore, Jr. 69 Retired President, Moore Motors Inc. 1988/1992
(automobile dealership); President
Elk Mountain Ski Resort, Inc.
Eric Stephens(1) 44 Auto Dealer, H.L. Stephens and Son 1988/1993
(automobile dealership)
(1) Eric Stephens is married to the niece of Donald R. Edwards, Sr.
(2) In accordance with Article 10 of the Amended Articles of
Incorporation of the Company, Mr. Goskowski served as a director of
the Corporation until December 31, 1995, the completion of the year
in which he attained 72 years of age. Mr. Goskowski continues to
serve as a director of the Bank. Mr. Goskowski is not a nominee
for director at this 1996 annual meeting of stockholders.
The Executive Compensation Committee of the Bank meets annually or as
needed to review salaries, compensation and personnel policies, the fee
structure for advisory boards and directors of the Company. John P.
Kameen, Joseph P. Moore, Jr., Michael T. Goskowski, William F. Farber, Sr.
and Judd B. Fitze serve as members of this committee. This committee met
one (1) time in 1995. Committee members received no remuneration for
serving on this committee.
The ALCO Committee of the Bank meets once a month to make
recommendations to the Board of Directors regarding the asset liability
functions of the Bank. William F. Farber, Sr., Judd B. Fitze, Michael T.
Goskowski, John P. Kameen, Joseph P. Moore, Jr., and Eric Stephens serve as
members of this committee. This committee met ten (10) times in 1995.
Scott A. Seasock, Senior Vice President and Chief Financial Officer of the
Company and the Bank, Thomas E. Sheridan, Senior Vice President and Chief
Operating Officer of the Company and the Bank, and Mark E. Caterson, Vice
President and Senior Trust Officer of the Bank, are ex-officio members of
this committee. Committee members received no remuneration for serving on
this committee.
The Director's Loan Committee of the Bank meets bi-monthly to review
commercial loans over $75,000 and consumer loans over $150,000. (The full
Board of Directors reviews all loans over $500,000). William F. Farber,
Sr., J. Robert McDonnell, David L. Baker, Donald R. Edwards, Sr., Robert J.
Babcock, William B. Lopatofsky, Erwin T. Kost, Theodore W. Porosky and
Robert T. Seamans serve as members of this committee. This committee met
eighteen (18) times in 1995. Committee members received no remuneration
for serving on this committee.
The Audit Committee of the Bank met eight (8) times in 1995 to make
recommendations concerning the Auditors of the Company and the Bank. John
P. Kameen, William B. Lopatofsky and Robert J. Babcock serve as members of
this committee. Messrs. William F. Farber, Sr. and Ms. M. Evelyn Pantzar,
Vice President and Internal Auditor of the Bank, are ex-officio members of
this committee. Committee members received no remuneration for serving on
this committee.
The Investment Committee of the Bank met fourteen (14) times in 1995
to review investments made by the Bank and its investment portfolio with
regard to the purchases and sales made, the schedule of maturities and the
investment results. John P. Kameen, Eric Stephens, Judd B. Fitze, Michael
T. Goskowski, Joseph P. Moore, Jr. and William F. Farber, Sr. are members
of this committee. Messrs. Scott A. Seasock, Thomas E. Sheridan, and Mark
E. Caterson are ex-officio members of this committee. Committee members
received no remuneration for serving on this committee.
The Trust Committee of the Bank met four (4) times in 1995 to review
the activities of the Trust Department of the Bank. David L. Baker, Robert
J. Babcock and Judd B. Fitze serve as members of this committee. Messrs.
William F. Farber, Sr. and Mark E. Caterson are ex-officio members of this
committee. Committee members received no remuneration for serving on this
committee.
The Board of Directors of the Bank met fourteen (14) times in 1995.
Each of the Directors of the Company and the Bank attended at least
seventy-five percent (75%) of the combined total number of meetings of the
Boards of Directors of the Company and the Bank and the committees of which
he is a member.
The Board of Directors of the Company has at present no standing
committees. The Company does not have a nominating committee. A
stockholder who desires to propose an individual for consideration by the
Board of Directors as a nominee for director should submit a proposal in
writing to Michael T. Goskowski, Secretary of the Company, in accordance
with Section 202 of the Company's By-laws.
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's officers and directors, and persons who own more
than ten percent (10%) of the 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
persons who own more than ten percent (10%) of the Company's Stock are
required by SEC regulation to furnish the Company with copies of all
Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by
it, or written representations from certain reporting persons that no Form
5 was required for those persons, the Company believes that during the
period January 1, 1995 through December 31, 1995, its officers and
directors were in compliance with all filing requirements applicable to
them.
EXECUTIVE COMPENSATION
Shown below is information concerning the annual compensation for
services in all capacities to the Company and Bank for the fiscal years
ended December 31, 1995, 1994, and 1993, to the present and former
President and CEO of the Company and Bank. No other officers' total annual
salary and bonus exceeded $100,000 during the fiscal years reported:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
___________________________
ANNUAL COMPENSATION AWARDS PAYOUTS
_________________________________________________________________________________________________________________________
Other
Name and Annual Restricted All Other
Principal Compens- Stock Options LTIP Compensa-
Position Year Salary($) Bonus($) ation($)(1) Award(s) /SARs Payouts tion($)
_________________________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C> <C> <C>
David L. Baker 1995 84,666 6,000 -0- -0- -0- -0- 1,379(2)
President and CEO
Gerald B. 1995 31,785 -0- -0- -0- -0- -0- 207,472(4)
Franceski(3) 1994 96,374 26,500 -0- -0- -0- -0- 4,020(2)
1993 93,044 30,000 -0- -0- -0- -0- 4,131(2)
<FN>
(1) The amount of perquisites and other personal benefits was less than ten
percent (10%) of the salary and bonus reported, and, therefore, need not be
presented.
(2) Represents the contribution the Bank made on behalf of Messrs. Baker and
Franceski pursuant to the profit sharing plan.
(3) The Company and Bank terminated the employment agreement with Mr. Franceski
on April 26, 1995.
(4) Represents the lump-sum payment at termination required by the employment
agreement with Mr. Franceski.
</TABLE>
PENSION PLAN
____________
The Company has a profit sharing plan ("Plan"), which covers all
employees who have completed 1,000 hours of service, attained 21 years of
age and have been employed by the Company for at least one year. The entry
date of an employee into the Plan is January 1 of the year following the
satisfaction of the eligibility requirements. Normal retirement age is
sixty-five (65). The normal retirement benefit is the accumulated account
balance of annual contributions, investment income and forfeitures. The
annual contribution is determined by the Board of Directors each year.
Contributions are allocated to each participant based on a pro-rata share
of compensation covered under the Plan. Investment income is allocated to
each participant based on a pro-rata share of the account balances
accumulated at the beginning of the year. Forfeitures are allocated to
each participant based on a pro-rata share of compensation covered under
the Plan. If a participant separates from service prior to retirement, the
participant will be entitled to a portion of the profit sharing account
based on years of service according to the following schedule:
Years of Service Vested Interest
________________ _______________
Less than 1 0%
1 10
2 20
3 30
4 40
5 60
6 80
7 or more 100%
A participant is always 100.0 percent vested in pension plan transferred
balances.
During 1995, $113,728 was allocated among the participants' accounts
of the Plan. The amount contributed by the Bank in 1995 to the Plan for
Mr. Franceski, the then President and CEO of the Company was $3,000. Mr.
Franceski had sixteen (16) years of credited service under the Plan. The
amount contributed by the Bank in 1995 to the Plan for Mr. Baker, the
President and CEO of the Company was $4,296. Mr. Baker had nine (9) years
of credited service under the Plan.
COMPENSATION OF DIRECTORS
_________________________
During 1995, Messrs. Baker and Franceski, officers of the Company and
Bank, sat on the Company's and Bank's Board of Directors and various
committees of the Company and Bank. Messrs. Baker and Franceski received
no fees for their services on such committees. Messr. Franceski received
$620 in fees for his services as a director on the Company's Board and no
fees for his services on the Bank's Board. Messr. Baker received no fees
for his services on the Company's or Bank's Board.
Except for Mr. Farber, members of the Bank's Board of Directors
received a fee of $800 per month. Mr. Farber, as the Chairman of the Bank,
received a fee of $1,300 per month. Aggregate directors' fees paid by the
Bank in 1995 were $140,400. All members of the Company's Board of
Directors, including Mr. Farber, the Chairman of the Company, received a
fee of $400 per quarter. Aggregate directors' fees paid by the Company in
1995 were $24,520.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
_____________________________________________________________
The Board of Directors of the Company is responsible for the
governance of the Company and Bank. In fulfilling its fiduciary duties,
the Board of Directors acts in the best interests of the Company's
stockholders, customers and the communities served by the Company and Bank.
To accomplish the strategic goals and objectives of the Company, the Board
of Directors engages competent persons who undertake to accomplish these
objectives with integrity and in a cost-effective manner. The compensation
of these individuals is part of the Board of Directors' fulfillment of its
duties to accomplish the Company's strategic mission. The Bank provides
compensation to the employees of the Company and Bank.
The fundamental philosophy of the Company's and Bank's compensation
program is to offer competitive compensation opportunities for all
employees based on the individual's contribution and personal performance.
The compensation program is administered by the Executive Compensation
Committee ("Committee") comprised of four outside directors, and a member
of the Bank's Board of Directors listed in the section "Executive
Officers," thereto. The objectives of the Committee are to establish a
fair compensation policy to govern executive officers' base salaries and
incentive plans to attract and motivate competent, dedicated and ambitious
managers whose efforts will enhance the products and services of the
Company, the results of which will be improved profitability, increased
dividends to our stockholders and subsequent appreciation in the market
value of our stock.
The compensation of the Company's and Bank's top executives is
reviewed and approved annually by the Board of Directors. The top
executives whose compensation is determined by the Committee include the
CEO and all other Vice Presidents. As guidance for review in determining
base salaries, the Committee uses information composed of a Pennsylvania
bank peer group. This bank peer group is different than the peer group
utilized for the performance chart. Pennsylvania peer group banks have
been utilized because of common industry issues and competition for the
same executive talent group.
CEO COMPENSATION
________________
The Board of Directors has determined that the CEO's 1995 compensation
of $90,666 (which represents Mr. Baker's annual salary and bonus) was
appropriate in light of the Company's 1995 performance accomplishments.
There is no direct correlation, however, between the President and CEO's
compensation and the Company's performance, nor is there any weight given
by the Committee to any specific individual criteria. Such 1995
compensation was based on the Committee's subjective determination after
review of all information that it deemed relevant.
EXECUTIVE OFFICERS
__________________
Compensation for the Bank's executive officers is determined by the
Committee based on its subjective analysis of the individual's contribution
to the Company's strategic goals and objectives. In determining whether
strategic goals have been achieved, the Board of Directors considers, among
numerous other factors, the following: the Company's performance as
measured by earnings, revenues, return on assets, return on equity, market
share, total assets and nonperforming loans. Although the performance and
increases in compensation are measured in light of these factors, there is
no direct correlation between any specific criterion and the employees
compensation, nor is there any specific weight provided to any such
criteria in the Committee's analysis. The determination by the Committee
is subjective after review of all information, including the above, it
deems relevant.
Total compensation opportunities available to the employees of the
Bank are influenced by general labor market conditions, the specific
responsibilities of the individual and the individual's contributions to
the Company's success. Individuals are reviewed annually on a calendar
year basis. The Bank strives to offer compensation that is competitive
with that offered by employers of comparable size in the banking industry.
Through these compensation policies, the Company strives to meet its
strategic goals and objectives to its constituents and provide compensation
that is fair and meaningful to its employees.
Submitted by the Executive Compensation Committee
_________________________________________________
William F. Farber, Sr.
Michael T. Goskowski
John P. Kameen
Joseph P. Moore, Jr.
Judd B. Fitze
STOCK PERFORMANCE GRAPH AND TABLE
_________________________________
<TABLE>
<CAPTION>
The following graph and table compare the cumulative stockholder
return on the Company's Common Stock during the period January 1, 1990,
through and including December 31, 1995, with (I) a Peer Group Index(1) and
(II) the Standard & Poor's 500 Index. The comparison assumes $100 was
invested on January 1, 1990, in the Company's Common Stock and in each of
the below indices and assumes further the reinvestment of dividends into
the applicable securities.
1990 1991 1992 1993 1994 1995
____ ____ ____ ____ ____ ____
(In Dollars)
<S> <C> <C> <C> <C> <C> <C>
Peer Group Index(1) $100.00 $ 95.06 $105.90 $146.10 $177.51 $202.19
Comm Bancorp, Inc. 100.00 88.59 90.73 112.13 158.80 169.26
Standard & Poor's 500 Index $100.00 $126.31 $131.95 $141.25 $139.08 $186.52
<FN>
(1) The Peer Group Index, for which information appears above, includes the
following companies: CNB Financial Corporation, Citizens & Northern
Corporation, Heritage Bancorp, Inc., Penn Security Bank & Trust Company,
Penns Woods Bancorp, Inc., Pioneer American Holding Company and Wayne Bank.
These companies were selected based on four criteria: total assets between
$150 million and $600 million; market capitalization greater than $20
million; headquarters located in Pennsylvania; and not quoted on the NASDAQ
Stock Market.
</TABLE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
______________________________________________
Except as described in the paragraphs below, there have been no
material transactions between the Company and Bank, nor any material
transactions proposed, with any director or executive officer of the
Company and Bank, or any associate of the foregoing persons. The Company
and Bank have had financial transactions in the ordinary course of business
with directors and officers of the Company and Bank. The Company and Bank
intend to continue to have banking and financial transactions in the
ordinary course of business with directors and officers of the Company and
Bank and their associates on substantially the same terms, including
interest rates and collateral, as those prevailing from time to time for
comparable transactions with other persons. Total loans outstanding from
the Bank as of December 31, 1995, to the Company's and Bank's executive
officers and directors as a group and members of their immediate families
and companies in which they had an ownership interest of 10.0 percent or
more was $3,157,222 or approximately 11.3 percent of the total equity
capital of the Company. Loans to such persons were made in the ordinary
course of business and were made on substantially the same terms, including
interest rates 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.
The Bank leases its Carbondale branch office from William F. Farber,
Sr., the Chairman of the Boards of Directors of the Company and Bank. The
lease, which commenced in October 1988, expires in 1998 and contains an
option that allows the Bank to purchase the property at fair market value
or renew the lease for two additional terms of five years each. In 1995,
lease payments to Mr. Farber were $6,020 per month or $72,240 annually.
The Bank has extended credit to Joseph P. Moore, Jr., a director of
the Company and Bank, who is President of Elk Mountain Ski Resort, Inc.
("Elk Mountain"). As of December 31, 1995, the Bank had outstanding
balances with Elk Mountain of $540.0 thousand, secured by a first lien
mortgage on all real property and equipment, and of $750.0 thousand,
secured by a second lien mortgage on all real property and equipment. The
interest rate on these mortgages was, and is, the Bank's prime rate of
interest.
PRINCIPAL OFFICERS OF THE COMPANY
_________________________________
<TABLE>
<CAPTION>
The following table sets forth selected information about the
principal officers of the Company, each of whom is elected by the Board of
Directors and each of whom holds office at the discretion of the Board of
Directors:
COMPANY
HELD EMPLOYEE NUMBER OF SHARES AGE AS OF
NAME AND POSITION SINCE SINCE BENEFICIALLY OWNED MARCH 1, 1996
_________________ _____ ________ __________________ _____________
<S> <C> <C> <C> <C>
William F. Farber, Sr. 1983 (1) 187,320 58
Chairman of the Board
David L. Baker 1995 1992(2) 11,304(3) 50
President and CEO
Scott A. Seasock 1987 1992(4) 2,745(5) 38
Senior Vice President and
Chief Financial Officer
Thomas E. Sheridan 1989 1985 1,764(6) 39
Senior Vice President and
Chief Operating Officer
J. Robert McDonnell 1983 (1) 32,544(6) 60
Vice President
Michael T. Goskowski 1984 (1) 21,096(7) 73
Secretary
<FN>
(1) Messrs. Farber, McDonnell and Goskowski are not employees of the
Bank.
(2) Prior to the merger of FNB Nicholson with the Bank, Mr. Baker
was employed by FNB Nicholson from 1987 to 1992 as the President.
(3) Includes 5,040 shares held individually; 4,800 shares held
jointly with his spouse; 732 shares held under his IRA; and 732
shares held under his spouse's IRA.
(4) Prior to the merger of FNB Nicholson with the Bank, Mr. Seasock
was employed by FNB Nicholson from 1987 to 1992 as Senior Vice
President and Chief Financial Officer.
(5) Includes 660 shares held under his IRA; 825 shares held jointly
with his spouse; 60 shares held jointly with his spouse and son;
and 1,200 shares held jointly with his spouse and sons.
(6) Held jointly with his spouse.
(7) Includes 9,540 shares held jointly with his spouse; 1,236 shares
held in trust for his granddaughter; and 10,320 shares held
jointly with his spouse and daughter.
</TABLE>
PRINCIPAL OFFICERS OF THE BANK
______________________________
<TABLE>
<CAPTION>
The following table sets forth selected information about the
principal officers of the Bank, each of whom is elected by the Board of
Directors of the Bank and each of whom holds office at the discretion of
the Bank's Board of Directors:
BANK
HELD EMPLOYEE NUMBER OF SHARES AGE AS OF
NAME AND POSITION SINCE SINCE BENEFICIALLY OWNED MARCH 1, 1996
_________________ _____ ________ __________________ _____________
<S> <C> <C> <C> <C>
David L. Baker 1995 1993(1) 11,304 50
President and CEO
Scott A. Seasock 1992 1992(2) 2,745 38
Senior Vice President and
Chief Financial Officer
Thomas E. Sheridan 1989 1985 1,764 39
Senior Vice President and
Chief Operating Officer
Thomas M. Chesnick 1989 1952 27,900(3) 61
Vice President, Cashier and
Assistant Secretary
<FN>
(1) See footnote (2) above under the caption entitled "Principal
Officers of the Company" as to the employment history of Mr.
Baker.
(2) See footnote (4) above under the caption entitled "Principal
Officers of the Company" as to the employment history of Mr.
Seasock.
(3) Includes 17,520 shares held jointly with his spouse; and 10,380
shares held jointly with various relatives.
</TABLE>
LEGAL PROCEEDINGS
GENERAL
_______
The nature of the Company's and the Bank's business generates a
certain amount of litigation involving matters arising in the ordinary
course of business. However, in the opinion of management of the Company
and the Bank, there are no proceedings pending to which the Company and the
Bank is a party or to which their property is subject, which, if determined
adversely to the Company and the Bank, would be material in relation to the
Company's and the Bank's undivided profits or financial condition, nor are
there any proceedings pending other than ordinary routine litigation
incident to the business of the Company and the Bank. In addition, no
material proceedings are pending or are known to be threatened or
contemplated against the Company and the Bank by government authorities or
others.
ENVIRONMENTAL ISSUES
____________________
There are several federal and state statutes that govern the
obligations of financial institutions with respect to environmental issues.
Besides being responsible under such statues for its own conduct, a bank
also may be held liable under certain circumstances for actions of
borrowers or other third parties on properties that collateralize loans
held by the bank. Such potential liability may far exceed the original
amount of the loan made by the bank. Currently, the Bank is not a party to
any pending legal proceedings under any environmental statute nor is the
Bank aware of any circumstances that may give rise to liability of the Bank
under any such statue.
RATIFICATION OF INDEPENDENT AUDITORS
Unless instructed to the contrary, it is intended that votes
will be cast pursuant to the Proxies for the ratification of the selection of
Kronick Kalada Berdy & Co., Certified Public Accountants of Kingston,
Pennsylvania ("Kronick Kalada Berdy"), as the Company's independent public
accountants for its fiscal year ending December 31, 1996. The Company has
been advised by Kronick Kalada Berdy that none of its members has any
financial interest in the Company. Ratification of Kronick Kalada Berdy
will require an affirmative vote of a majority of the shares of Common
Stock represented at the Annual Meeting. Kronick Kalada Berdy served as
the Company's independent public accountants for the Company's 1995 fiscal
year.
In addition to performing customary audit services, Kronick
Kalada Berdy assisted the Company with the preparation of its federal and state
tax returns, and provided assistance in connection with regulatory matters,
charging the Company for such services at its customary hourly billing
rates. These non-audit services were approved by the Company's and the
Bank's Board of Directors, after due consideration of the effect of the
performance thereof on the independence of the accountants and after the
conclusion by the Company's and the Bank's Board of Directors that there
was no effect on the independence of the accountants.
In the event that the shareholders do not ratify the selection
of Kronick Kalada Berdy as the Company's independent public accountant's for
the 1996 fiscal year, another accounting firm will be chosen to provide
independent public accountant audit services. The Board of Directors
recommends that the stockholders vote FOR the ratification of the selection
of Kronick Kalada Berdy as the auditors for the Company for the year ending
December 31, 1996.
It is understood that even if the selection of Kronick Kalada
Berdy is ratified, the Board of Directors, in its discretion, may direct the
appointment of a new independent auditing firm at any time during the year
if the Board of Directors determines that such a change would be in the
best interests of the Company and its stockholders.
ANNUAL REPORT
A copy of the Company's Annual Report for its fiscal year ended
December 31, 1995 is enclosed with this Proxy Statement. A representative
of Kronick Kalada Berdy & Co., the accounting firm which examined the
financial statements in the Annual Report, will attend the Annual Meeting.
This representative will have the opportunity to make a statement, if he
desires to do so, and at his discretion will respond to any appropriate
questions presented by stockholders at the Annual Meeting.
STOCKHOLDER PROPOSALS
Any stockholder who, in accordance with and subject to the
provisions of the Proxy rules of the Securities and Exchange Commission, wishes
to submit a proposal for inclusion in the Company's Proxy Statement for its
1997 Annual Meeting of Stockholders must deliver such proposal in writing
to the President of Comm Bancorp, Inc. at its principal executive offices
in Forest City, Pennsylvania 18421, no later than Wednesday, January 8, 1997.
OTHER MATTERS
The Board of Directors does not know of any matters to be
presented for consideration other than the matters described in the accompanying
Notice of Annual Meeting of Stockholders, but if any matters are properly
presented, it is the intention of the persons named in the accompanying
Proxy to vote on such matters in accordance with their best judgment.
ADDITIONAL INFORMATION
UPON WRITTEN REQUEST OF ANY STOCKHOLDER, A COPY OF THE COMPANY'S
REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED DECEMBER 31, 1995, AS
AMENDED, INCLUDING THE FINANCIAL STATEMENTS AND THE SCHEDULES THERETO,
REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT
TO RULE 13a-1 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, MAY BE
OBTAINED, WITHOUT CHARGE, FROM SCOTT A. SEASOCK, CHIEF FINANCIAL OFFICER,
COMM BANCORP, INC.
IN ADDITION, A COPY OF THE ANNUAL DISCLOSURE STATEMENT OF
COMMUNITY BANK AND TRUST COMPANY MAY ALSO BE OBTAINED, WITHOUT CHARGE, FROM
SCOTT A. SEASOCK, CHIEF FINANCIAL OFFICER OF THE BANK.
COMM BANCORP, INC.
PROXY
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 7, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Scott A. Seasock
and Thomas E. Sheridan and each or any of them, Proxies of the undersigned,
with full power of substitution, to vote all of the shares of Comm Bancorp,
Inc. (the "Company") that the undersigned may be entitled to vote at the
Annual Meeting of Stockholders of the Company to be held at the American
Legion Post #524, Dundaff Street, Forest City, Pennsylvania 18421, on
Friday, June 7, 1996 at 1:00 p.m., prevailing time, and at any adjournment
or postponement thereof as follows:
1. PROPOSAL TO FIX THE NUMBER OF DIRECTORS TO BE ELECTED AT NINE
(9).
[ ] FOR [ ] AGAINST
The Board of Directors recommends a vote FOR this proposal.
________________________________________________________________________________
2. ELECTION OF DIRECTORS TO SERVE FOR A ONE-YEAR TERM
[ ] FOR ALL NOMINEES [ ] WITHHOLD AUTHORITY
LISTED BELOW (except to vote for all
as marked to the nominees listed
contrary below) below
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE, WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
David L. Baker, Donald R. Edwards, Sr., William F. Farber, Sr.,
Judd B. Fitze, John P. Kameen, William B. Lopatofsky, J. Robert
McDonnell, Joseph P. Moore, Jr., Eric Stephens
________________________________________________________________________________
3. PROPOSAL TO RATIFY THE SELECTION OF KRONICK KALADA BERDY & CO.
AS THE INDEPENDENT AUDITORS FOR THE COMPANY FOR THE YEAR ENDING
DECEMBER 31, 1996.
[ ] FOR [ ] AGAINST
The Board of Directors recommends a vote FOR this proposal.
________________________________________________________________________________
4. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON
SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING AND
ANY ADJOURNMENT OR POSTPONEMENT THEREOF.
THIS PROXY, WHEN PROPERLY SIGNED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR ALL NOMINEES LISTED ABOVE AND FOR PROPOSALS 1 AND 3.
Dated:_________________ , 1996
______________________________
______________________________
Signature(s) (Seal)
Number of Shares Held of
Record on May 8, 1996
_____________________
THIS PROXY MUST BE DATED AND SIGNED BY THE STOCKHOLDER. WHEN
SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE GIVE
FULL TITLE. IF MORE THAN ONE TRUSTEE, ALL SHOULD SIGN. IF STOCK IS HELD
JOINTLY, EACH OWNER SHOULD SIGN.
