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 Section 240.14a-11(c) or
Section 240.14a-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] No Fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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4) Date Filed:
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NOTICE OF 2000
ANNUAL MEETING
OF STOCKHOLDERS
AND PROXY STATEMENT
PLEASE COMPLETE, SIGN, DATE AND RETURN
YOUR PROXY PROMPTLY
Friday, April 28, 2000
10:30 A.M.
Elk Mountain Ski Resort
Route 374
Union Dale, Pennsylvania
Comm Bancorp, Inc.
521 Main Street
Forest City, PA 18421
(570) 785-3181
WILLIAM F. FARBER, SR.
Chairman
March 29, 2000
Dear Stockholder:
You are cordially invited to join us at the 2000 Annual Meeting of Stockholders
in Union Dale, Pennsylvania, on April 28, 2000.
Enclosed with this Proxy Statement are your voting instructions and the 1999
Annual Report.
At this meeting, we will vote on the matters described in the Proxy Statement.
We know that it is not practical for many stockholders to attend the Annual
Meeting in person. In addition, annual meetings are not the most efficient way
to communicate with our stockholders. Therefore, we encourage you to visit
our site on the Worldwide Web at http://www.combk.com for up-to-the-moment
news about the Company. After the meeting, you are invited to enjoy a light
luncheon.
Whether or not you plan to attend the Annual Meeting, we strongly encourage you
to designate the proxies shown on the attached form to vote your shares.
Please complete, sign, date and return by mail the enclosed proxy form in the
envelope provided.
I would like to take this opportunity to remind you that your vote is
important.
Sincerely,
/s/ William F. Farber, Sr.
--------------------------
William F. Farber, Sr.
Chairman
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
DATE : April 28, 2000
TIME : 10:30 A.M.
PLACE: Elk Mountain Ski Resort
Route 374
Union Dale, Pennsylvania
MATTERS TO BE VOTED UPON:
1. A proposal to fix the number of directors to be elected at thirteen;
2. A proposal to elect the nominees named in the attached proxy as directors
to serve for a one-year term;
3. A proposal to ratify the appointment of Kronick Kalada Berdy & Co. as our
independent auditors for the year 2000; and
4. Any other matters that may properly come before the meeting.
YOUR BOARD OF DIRECTORS RECOMMENDS YOU VOTE IN FAVOR OF THE PROPOSALS TO FIX
THE NUMBER OF DIRECTORS AT THIRTEEN, TO ELECT THE NOMINEES AS DIRECTORS AND TO
APPOINT KRONICK KALADA BERDY & CO.
Stockholders who are holders of record of the Common Stock at the close of
business on January 31, 2000, will be entitled to vote at the meeting. If you
plan to attend the meeting, please indicate your wish by checking the box that
appears on the proxy form.
IT WILL BE HELPFUL TO US IF YOU WILL READ THE PROXY STATEMENT AND THE VOTING
INSTRUCTIONS ON THE PROXY FORM, AND THEN VOTE BY PROMPTLY FILLING OUT, SIGNING
AND DATING THE PROXY FORM AND RETURNING IT BY MAIL IN THE ENVELOPE PROVIDED.
By Order of the Board of Directors
/s/William F. Farber Sr.
- --------------------------
William F. Farber, Sr. Forest City, Pennsylvania
Chairman March 29, 2000
TABLE OF CONTENTS
Page No.
QUESTIONS AND ANSWERS . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
BOARD OF DIRECTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
* PROPOSAL TO FIX THE NUMBER OF DIRECTORS AT THIRTEEN (ITEM 1 ON PROXY FORM) 2
* PROPOSAL TO ELECT THE NOMINEES AS DIRECTORS (ITEM 2 ON PROXY FORM). . . . 3
Committees of the Board of Directors . . . . . . . . . . . . . . . . . 5
Board of Directors' Compensation . . . . . . . . . . . . . . . . . . . 6
STOCK OWNERSHIP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Stock Owned by Directors, Nominees and Executive Officers. . . . . . . 7
Compliance with Section 16(a) of the Securities Exchange Act of 1934 . 7
Voting Stock Owned by "Beneficial Owner" . . . . . . . . . . . . . . . 8
EXECUTIVE COMPENSATION. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Summary Compensation Table . . . . . . . . . . . . . . . . . . . . . . 8
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . 9
Estimated Retirement Benefits. . . . . . . . . . . . . . . . . . . . . 10
Change in Control Agreements . . . . . . . . . . . . . . . . . . . . . 10
Five-Year Performance Graph. . . . . . . . . . . . . . . . . . . . . . 11
INDEPENDENT AUDITORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
* PROPOSAL TO RATIFY THE APPOINTMENT OF KRONICK KALADA BERDY & CO.
(ITEM 3 ON PROXY FORM) . . . . . . . . . . . . . . . . . . . . . . . . 13
OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Transactions Involving the Company's Directors and Executive Officers 13
No Significant Legal Proceedings . . . . . . . . . . . . . . . . . . . 13
Other Proposed Action. . . . . . . . . . . . . . . . . . . . . . . . . 13
Stockholder Proposals and Nominations for 2001 Annual Meeting. . . . . 14
Additional Information Available . . . . . . . . . . . . . . . . . . . 14
- -----------------
* Matters to be voted upon
QUESTIONS AND ANSWERS
____________________________________________________________________________
Q: WHAT AM I VOTING ON?
A: Three proposals. Item numbers refer to item numbers on the proxy form.
Item 1. To fix the number of directors at thirteen.
Item 2. To elect the nominees as directors.
Item 3. To ratify the appointment of Kronick Kalada Berdy & Co. as
independent auditors of the Company for the year ending
December 31, 2000.
____________________________________________________________________________
Q: WHO CAN VOTE?
A: All stockholders of record at the close of business on January 31, 2000,
are entitled to vote. Holders of the Company's Common Stock are entitled
to a vote per share. Fractional shares, such as those in the dividend
reinvestment plan, will be voted.
____________________________________________________________________________
Q: HOW DO I VOTE FOR DIRECTORS?
A: Each share is entitled to cast a vote for each nominee. For example, if
you can vote 100 shares, you can cast up to 100 votes for each nominee
for director.
____________________________________________________________________________
Q: WHO CAN ATTEND THE MEETING?
A: All stockholders as of the record date, or their duly appointed proxies,
may attend the meeting. Seating, however, is limited. Upon arrival at
the meeting, everyone is required to check in at the registration desk.
____________________________________________________________________________
Q: HOW DO I VOTE?
A: You may cast your vote by completing, signing, dating and mailing the
proxy form in the enclosed postage-paid envelope. By voting, you will
authorize the individuals named on the proxy form, referred to as the
proxies, to vote your shares according to your instructions.
____________________________________________________________________________
Q: WHAT HAPPENS IF I DO NOT INDICATE MY PREFERENCE FOR ONE OF THE ITEMS?
A: If you leave Item 1 blank, the proxies will vote FOR the proposal to fix
the number of directors at thirteen in number (Item 1). If you do not
indicate how you wish to vote for one or more of the nominees for
director, the proxies will vote FOR election of all the nominees for
Director (Item 2). If you "withhold" your vote for any of the nominees,
this will be counted as a vote AGAINST that nominee. If you
leave Item 3 blank, the proxies will vote FOR ratification of the
appointment of Kronick Kalada Berdy & Co. (Item 3).
____________________________________________________________________________
Q: WHAT IF I VOTE AND THEN CHANGE MY MIND?
A: You can revoke your proxy by writing to us, by voting again via mail,
or by attending the meeting and casting your vote in person. Your last
vote will be the vote that is counted.
____________________________________________________________________________
Q: WHAT CONSTITUTES A QUORUM?
A: As of the record date, January 31, 2000, the Company had 2,017,034
shares of Common Stock outstanding. The holders of Common Stock have
the right to cast a total of 2,017,034 votes. The presence, in person
or by proxy, of stockholders entitled to cast at least a majority of
the votes, which all stockholders are entitled to cast, constitutes a
quorum for adopting the proposals at the meeting. If you have properly
designated the proxies and indicated your voting preferences by mail,
you will be considered part of the quorum, and the proxies will vote
your shares as you have instructed them. If a broker holding your
shares in "street" name indicates to us on a proxy form that the broker
lacks discretionary authority to vote your shares, we will not consider
your shares as present or entitled to vote for any purpose.
___________________________________________________________________________
Q: IS MY VOTE CONFIDENTIAL?
A: Yes. Proxy forms, ballots and voting tabulations that identify
individual stockholders are kept confidential except in certain
circumstances where it is important to protect the interests of the
Company and its stockholders. Generally, only the judge of election
and the employees of the Company processing the votes will have access
to your name. They will not disclose your name as the author of any
comments you include on the proxy form unless you ask that your name be
disclosed to management.
___________________________________________________________________________
Q: WHO WILL COUNT THE VOTES?
A: Employees of the Company will tabulate the votes and the judge of
election will review their tabulation process.
___________________________________________________________________________
Q: WHAT SHARES ARE INCLUDED IN THE PROXY FORM?
A: The shares listed on your form sent by the Company represent all the
shares of Common Stock held in your name (as distinguished from those
held in "street" name), including those held in the dividend
reinvestment plan. You will receive a separate proxy form or forms
from your broker if you hold shares in "street" name.
___________________________________________________________________________
Q: WHAT DOES IT MEAN IF I GET MORE THAN ONE PROXY FORM?
A: It indicates that your shares are held in more than one account, such
as two brokerage accounts and registered in different names. You
should vote each of the proxy forms to ensure that all of your shares
are voted. We encourage you to register all of your brokerage accounts
in the same name and address for better stockholder service. You may
do this by contacting our transfer agent, American Stock Transfer and
Trust Company, at 1-800-937-5449.
___________________________________________________________________________
Q: HOW MUCH DID THIS PROXY SOLICITATION COST?
A: The Company solicits proxies from stockholders at an estimated cost of
$250. (Note that this fee does not include the costs of printing and
mailing the proxy statements.) Some of the officers and other
employees of the Company also may solicit proxies personally, by
telephone and by mail. The Company will also reimburse brokerage
houses and other custodians for their reasonable out-of-pocket expenses
for forwarding proxy and solicitation material to the beneficial owners
of Common Stock.
___________________________________________________________________________
Q: WHOM CAN I CALL WITH ANY QUESTIONS?
A: You may call Investor Relations at (570) 586-0377, extension 308.
BOARD OF DIRECTORS AND NOMINEES
PROPOSAL TO FIX THE NUMBER OF DIRECTORS AT THIRTEEN
Item 1 on Proxy Form
The Company desires to increase the number of directors from ten to thirteen.
Directors are a source of strength to the Company's business. Directors
assist in the generation of new business for the Company; serve on various
administrative committees of our subsidiary bank, Community Bank and Trust
Co. ("Community Bank"); and identify strategic opportunities for the
development of new products and services and new delivery channels for
our current products and services.
The increase of three directors will better distribute the administrative,
marketing and strategic development tasks among the members of the Board of
Directors.
REQUIRED VOTE
Article 12 of the Company's Amended Articles of Incorporation requires the
exact number of directors to be fixed by a "majority of stockholders."
Therefore, for purposes of this proposal, an affirmative vote of a majority
of the issued and outstanding shares is required to approve this proposal.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL TO INCREASE
THE NUMBER OF DIRECTORS FROM TEN TO THIRTEEN. PROXIES SOLICITED FROM THE
BOARD OF DIRECTORS WILL BE SO VOTED UNLESS YOU SPECIFY OTHERWISE.
PROPOSAL TO ELECT THE NOMINEES AS DIRECTORS
Item 2 on Proxy Form
The Company has ten directors. Each director holds office for a one-year term.
Assuming the stockholders approve the proposal to increase the number of
directors to be elected, the stockholders elect thirteen directors at this
meeting. Unless you withhold authority to vote for one or more of the
nominees, the persons named as proxies intend to vote for the election of
the thirteen nominees for director. All of the nominees are recommended by
the Board of Directors:
David L. Baker
Thomas M. Chesnick
William F. Farber, Sr.
Judd B. Fitze
John P. Kameen
William A. Kerl
Erwin T. Kost
William B. Lopatofsky
Robert A. Mazzoni
J. Robert McDonnell
Joseph P. Moore, III
Theodore W. Porosky
Eric G. Stephens
All nominees have consented to serve as directors. The Board of Directors has
no reason to believe that any of the nominees should be unable to act as a
director. However, if any nominee is unable to stand for election, the Board
of Directors will designate a substitute. If a substitute nominee is named,
the proxies will vote for the election of the substitute.
THIS SECTION GIVES BIOGRAPHICAL INFORMATION ABOUT OUR DIRECTORS AND NOMINEES
FOR DIRECTORS AND DESCRIBES THEIR MEMBERSHIP ON BOARD OF DIRECTORS'
COMMITTEES, THEIR ATTENDANCE AT MEETINGS AND THEIR COMPENSATION.
The following information includes the age of each nominee as of January 31,
2000.
DAVID L. BAKER, 54
Director of the Company since 1988 and director of Community Bank and
Trust Co. ("Community Bank") since 1993; President and Chief Executive
Officer of the Company and Community Bank since 1995.
THOMAS M. CHESNICK, 65
Director of Community Bank since January 19, 2000. Retired. Vice
President of Community Bank from 1995 to 1999.
WILLIAM F. FARBER, SR., 62
Director of the Company since 1983 and director of Community Bank since
1970; and Chairman of the Boards of Directors of the Company and
Community Bank. Retired president of Farber's Restaurants.
JUDD B. FITZE, 47
Director of the Company since 1995 and director of Community Bank since
1993. Partner in Farr, Davis & Fitze, a law firm.
JOHN P. KAMEEN, 58
Director of the Company since 1983 and director of Community Bank since
1979; and Secretary of the Company and Community Bank. Publisher of the
Forest City News.
------ ---- ----
WILLIAM A. KERL, 63
Director of Community Bank since 1997. President of Carbondale Concrete
Company, Inc. and Kerl Coal, Oil & Trucking Company, Inc. Partner in
Kerl Ice Company.
ERWIN T. KOST, 56
Director of the Company since 1997 and director of Community Bank since
1993. President of Kost Tire Distributors, Inc.
WILLIAM B. LOPATOFSKY, 67
Director of the Company since 1983 and director of Community Bank since
1982. Retired.
ROBERT A. MAZZONI, 51
Director of Community Bank since January 19, 2000. Partner in Mazzoni &
Karam, a law firm.
J. ROBERT MCDONNELL, 64
Director of the Company since 1983 and director of Community Bank since
1979; and Vice President of the Company. President of McDonnell's
Restaurant.
JOSEPH P. MOORE, III, 48
Director of Community Bank since January 19, 2000. President of
J.J. Motors, Inc., an automobile dealership.
THEODORE W. POROSKY, 52
Director of the Company since 1997 and director of Community Bank since
1989. Owner of Porosky Lumber Company.
ERIC G. STEPHENS, 48
Director of the Company since 1988 and director of Community Bank since
1993. Auto Dealer, H.L. Stephens and Son, an automobile dealership.
REQUIRED VOTE
If the stockholders do not approve the proposal to fix the number of directors
to be elected at thirteen, ten nominees will be elected who receive the ten
highest numbers of votes.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTOR LISTED
ABOVE. ABSTENTIONS AND VOTES WITHHELD FOR DIRECTORS WILL HAVE THE SAME EFFECT
AS VOTES AGAINST.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company has no standing committees. The
following information is for committees of Community Bank. Appointments to
these committees occurred January 19, 2000.
<TABLE>
<CAPTION>
EXECUTIVE ASSET/
NAME EXECUTIVE COMPENSATION AUDIT INVESTMENT LIABILITY LOAN TRUST MARKETING
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
DAVID L. BAKER X X X X
- ----------------------------------------------------------------------------------------------
THOMAS M. CHESNICK X
- ----------------------------------------------------------------------------------------------
WILLIAM F. FARBER, SR. X X X X X
- ----------------------------------------------------------------------------------------------
JUDD B. FITZE X X X X
- ----------------------------------------------------------------------------------------------
JOHN P. KAMEEN X X X X X
- ----------------------------------------------------------------------------------------------
WILLIAM A. KERL X X
- ----------------------------------------------------------------------------------------------
ERWIN T. KOST X X X
- ----------------------------------------------------------------------------------------------
WILLIAM B. LOPATOFSKY X X
- ----------------------------------------------------------------------------------------------
ROBERT A. MAZZONI X X
- ----------------------------------------------------------------------------------------------
J. ROBERT McDONNELL X X X X X
- ----------------------------------------------------------------------------------------------
JOSEPH P. MOORE, III X X
- ----------------------------------------------------------------------------------------------
JOSEPH P. MOORE, JR. X X X
- ----------------------------------------------------------------------------------------------
THEODORE W. POROSKY X
- ----------------------------------------------------------------------------------------------
ERIC G. STEPHENS X X X X
- ----------------------------------------------------------------------------------------------
</TABLE>
NUMBER OF MEETINGS
The Board of Directors met 12 times during 1999. All of the Company's
directors attended 75% or more of all Board of Directors and Committee
meetings of the Company and Community Bank during 1999.
EXECUTIVE COMMITTEE
The Executive Committee is responsible for exercising the authority of the
Board of Directors in the intervals between the meetings of the Board of
Directors so far as may be permitted by law.
EXECUTIVE COMPENSATION COMMITTEE
The Executive Compensation Committee is responsible for reviewing salaries,
compensation and personnel policies, and the fee structure for advisory
boards and directors of the Company and Community Bank.
AUDIT COMMITTEE
The Audit Committee is responsible for the review and evaluation of the
system of internal controls and corporate compliance with applicable rules,
regulations and laws. The Audit Committee meets with Community Bank's internal
auditor, outside independent auditors and senior management to review the scope
of the internal and external audit engagements, the adequacy of the internal
and external auditors, corporate policies to ensure compliance and significant
changes in accounting principles.
INVESTMENT COMMITTEE
The Investment Committee is responsible for reviewing the investment portfolio
with regard to the purchases and sales of securities, the schedule of
maturities, and the portfolio's risk and return.
ASSET/LIABILITY COMMITTEE
The Asset/Liability Committee is responsible for making recommendations to the
Board of Directors regarding the asset/liability functions.
LOAN COMMITTEE
The Loan Committee is responsible for reviewing commercial loans over
$100,000 and consumer loans over $150,000. The full Board of Directors
reviews all loans over $500,000.
TRUST COMMITTEE
The Trust Committee is responsible for reviewing the activities of the Trust
Department.
MARKETING COMMITTEE
The Marketing Committee is responsible for reviewing the marketing strategies.
BOARD OF DIRECTORS' COMPENSATION
DIRECTORS' FEES
Directors' fees, paid only to directors who are not employees of the Company
or Community Bank, are as follows:
Monthly fee for service as Company director . . . . . . . $ 500
Monthly fee for service as Community Bank director
(except Chairman). . . . . . . . . . . . . . . . . . . . $1,000
Monthly fee for service as Community Bank Chairman. . . . $3,500
1999 year-end bonus fee to each Community Bank director . $1,500
Company directors received in the aggregate in 1999 $54,000 in fees.
Community Bank directors received in the aggregate in 1999 $186,000 in fees.
STOCK OWNERSHIP
THIS SECTION DESCRIBES HOW MUCH STOCK OUR DIRECTORS, NOMINEES FOR DIRECTOR AND
EXECUTIVE OFFICERS OWN. IT ALSO DESCRIBES THE PERSONS OR ENTITIES THAT OWN
MORE THAN 5% OF OUR VOTING STOCK.
STOCK OWNED BY DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS
This table indicates the number of shares of Common Stock owned by the
directors, nominees for director and executive officers as of
January 31, 2000. The aggregate number of shares owned by all directors,
nominees for director and executive officers is 17.94%. Unless otherwise
noted, each individual has sole voting and investment power for the shares
indicated below.
<TABLE>
<CAPTION>
NAME OF INDIVIDUAL AMOUNT AND NATURE OF
OR IDENTITY OF GROUP BENEFICIAL OWNERSHIP(1) PERCENT OF CLASS
- -------------------------------------------------------------------------
<S> <C> <C>
David L. Baker 13,658.717 ----
- -------------------------------------------------------------------------
Thomas M. Chesnick (2) 26,377.544 1.31%
- -------------------------------------------------------------------------
William F. Farber, Sr. 184,020.000 9.12%
- -------------------------------------------------------------------------
Judd B. Fitze 12,640.779 ----
- -------------------------------------------------------------------------
John P. Kameen 20,391.552 1.01%
- -------------------------------------------------------------------------
William A. Kerl (2) 12,500.368 ----
- -------------------------------------------------------------------------
Erwin T. Kost 10,080.114 ----
- -------------------------------------------------------------------------
William B. Lopatofsky 26,730.000 1.33%
- -------------------------------------------------------------------------
Robert A. Mazzoni (2) 100.000 ----
- -------------------------------------------------------------------------
J. Robert McDonnell 33,581.183 1.66%
- -------------------------------------------------------------------------
Joseph P. Moore, III (2) 100.000 ----
- -------------------------------------------------------------------------
Theodore W. Porosky 3,692.374 ----
- -------------------------------------------------------------------------
Scott A. Seasock (3) 4,185.480 ----
- -------------------------------------------------------------------------
Thomas E. Sheridan(3) 6,323.850 ----
- -------------------------------------------------------------------------
Eric G. Stephens 7,409.653 ----
- -------------------------------------------------------------------------
All Directors, Nominees and
Executive Officers of the
Company as a group
(9 Directors, 13 Nominees,
6 Officers, 15 persons in
total) 361,791.614 17.94%
(1) Includes shares held (a) directly, (b) jointly with spouse, (c) by
spouse, (d) jointly with various relatives, (e) by the transfer agent
in the Company dividend reinvestment account, and (f) in various trusts.
(2) A nominee for director, not a current director.
(3) Executive Officer, not a director or nominee.
</TABLE>
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Executive officers and directors and "beneficial owners" of more than ten
percent of the Common Stock must file initial reports of ownership and
reports of changes in ownership with the SEC and The NASDAQ Stock Market
pursuant to Section 16(a).
We have reviewed the reports and written representations from the executive
officers and directors. Based on this review, the Company believes that all
filing requirements were met during 1999.
VOTING STOCK OWNED BY "BENEFICIAL OWNER"
The following are the persons or entities known by the Company to own
beneficially more than five percent of the Common Stock as of January 31, 2000.
<TABLE>
<CAPTION>
Name and Address Number of Shares(1) Percent of Class
- ----------------------------------------------------------------------------
<S> <C> <C>
Joseph P. Moore, Jr. (2)
400 Williamson Road
Gladwyne, PA 19035 195,935.000 9.71%
- ----------------------------------------------------------------------------
William F. Farber, Sr.
Crystal Lake Road
R.R. 1, Box 1281
Carbondale, PA 18407 184,020.000 9.12%
- ----------------------------------------------------------------------------
(1) Includes shares held (a) directly and (b) in various trusts.
(2) Mr. Moore retired from the Company's Board of Directors effective
January 1, 2000, due to the mandatory age requirement.
</TABLE>
EXECUTIVE COMPENSATION
THIS SECTION CONTAINS CHARTS THAT SHOW THE AMOUNT OF COMPENSATION EARNED BY OUR
EXECUTIVE OFFICERS WHOSE SALARY AND BONUS EXCEEDED $100,000 FOR 1999. IT ALSO
CONTAINS THE PERFORMANCE GRAPH COMPARING THE COMPANY'S PERFORMANCE RELATIVE TO
ITS PEER GROUP AND THE REPORT OF OUR EXECUTIVE COMPENSATION COMMITTEE
EXPLAINING THE COMPENSATION PHILOSOPHY FOR OUR MOST HIGHLY PAID OFFICERS.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
-----------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
- --------------------------------------------------------------------------------------
OTHER ANNUAL RESTRICTED LTIP ALL OTHER
SALARY BONUS COMPENSTAION OPTIONS STOCK PAYOUTS COMPENSATION
NAME AND POSITION YEAR ($) ($) ($)(1) (#) (#) ($) ($)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
David L. Baker 1999 116,619 19,400 2,179 -0- -0- -0- -0-
President and Chief 1998 116,151 19,400 3,245 -0- -0- -0- -0-
Executive Officer 1997 111,401 18,700 3,346 -0- -0- -0- -0-
of the Company and
Community Bank
- ----------------------------------------------------------------------------------------------------
Scott A. Seasock 1999 94,345 11,400 1,696 -0- -0- -0- -0-
Senior Vice 1998 92,486 11,400 2,453 -0- -0- -0- -0-
President and Chief 1997 88,953 10,700 2,281 -0- -0- -0- -0-
Financial Officer
of the Company and
Community Bank
- ----------------------------------------------------------------------------------------------------
(1) Represents the contribution Community Bank made on behalf of Messrs. Baker and Seasock pursuant
to the profit sharing plan. Aggregate perquisites and other personal benefits were less than
10.0 percent of the salary and bonus reported, and therefore, need not be presented.
</TABLE>
EXECUTIVE COMPENSATION
Executive compensation for the officers of the Company and Community Bank is
determined by the Executive Compensation Committee of Community Bank's Board
of Directors. Salaries and bonuses for the executive officers are reviewed
annually. All executive compensation is paid by Community Bank to the
applicable executive.
EXECUTIVE COMPENSATION COMMITTEE REPORT
The Board of Directors is responsible for the governance of the Company and
Community 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 Community 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. Community Bank provides
compensation to the employees of the Company and the Community Bank.
The fundamental philosophy of the Company's and Community Bank's compensation
program is to offer competitive compensation opportunities for all employees
based on the individual's contribution and personal performance. The
objective of the Executive Compensation Committee is 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 Community Bank's top executives is
reviewed and approved annually by the Board of Directors. The top executives
whose compensation is determined by this committee include the Chief
Executive Officer and all other executive management. As a guideline for
review in determining base salaries, this committee uses information composed
from 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.
EXECUTIVE COMPENSATION
The Board of Directors has determined that the 1999 compensation for the
President and Chief Executive Officer of $136,019 and the Senior Vice
President and Chief Financial Officer of $105,745 were appropriate in light
of the Company's 1999 performance accomplishments. There is no direct
correlation, however, between such compensation and the Company's
performance, nor is there any weight given by the Committee to any specific
individual criteria. Such 1999 compensation was based on the Committee's
subjective determination after review of all information that it deemed
relevant.
EXECUTIVE OFFICERS
Compensation for the Company's and Community Bank's executive officers is
determined by the Executive Compensation 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 the Company's performance as measured by,
among numerous other factors, the following: (i) earnings; (ii) revenues;
(iii) return on assets; (iv) return on equity; (v) market share; (vi) total
assets; and (vii) non-performing 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 this committee's analysis. The determination by this committee is
subjective after review of all information, including the above, it deems
relevant.
Total compensation opportunities available to the employees of the Company and
Community 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 Company 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 constituencies and provide
compensation that is fair and meaningful to its employees.
Submitted by the Executive Compensation Committee
-------------------------------------------------
William F. Farber, Sr.
Judd B. Fitze
John P. Kameen
J. Robert McDonnell
Eric G. Stephens
ESTIMATED RETIREMENT BENEFITS
Community Bank has a profit sharing plan, which covers all employees who have
completed 1,000 hours of service, attained twenty-one (21) years of age and
have been employed by Community Bank for at least one year. 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 one hundred percent (100%) vested in pension plan
transferred balances.
During 1999, $45,754 was allocated among the participants' accounts for the
plan. The amount contributed by Community Bank in 1999 to the plan for Mr.
Baker was $2,179 and Mr. Seasock was $1,696. Both Messrs. Baker and Seasock
had thirteen (13) years of credited service under the plan.
CHANGE IN CONTROL AGREEMENTS
The Company entered into agreements with David L. Baker, President and Chief
Executive Officer, Thomas E. Sheridan, Senior Vice President and Chief
Operations Officer, and Scott A. Seasock, Senior Vice President and Chief
Financial Officer, to provide these key officers with a reasonable degree
of financial security after the occurrence of a change in control of the
Company.
These agreements contain the following principal features:
- - during the 24 months following a change in control of the Company, if the
officer is terminated "without good cause" or "constructively terminated,"
as these terms are defined in the agreement, then the Company (or its
successor) shall:
-- pay, in a lump sum or in 24 equal monthly installments, to the
terminated officer an amount equal to two times his highest annual
base salary rate during the 5-year period ending on the date of
termination;
-- continue to provide the terminated officer and his dependents for a
period of 24 months after the date of termination all health
programs or their substantial equivalent at a cost to the terminated
officer not exceeding the equivalent cost of coverage to senior
management employees of the Company;
-- pay any additional monies to the terminated officer to place him in
the same after-tax position if there is imposed any excise tax as a
result of the amount of these payments; and
-- continue, for a 6-year period, to provide indemnification protection
under the Company's Amended Articles of Incorporation and Bylaws and
coverage under director's and officer's liability and fiduciary
liability insurance policies.
- - under these agreements, a change in control means:
-- acquisition of 25% or more of the voting power of all outstanding
stock by a person or group of persons;
-- combination of the Company into another entity in which the Company's
stockholders do not hold at least 50% of the voting power of the
outstanding stock after the combination;
-- nomination and election of 50% or more of the members of the Board
without the recommendation of the Board; or
-- the sale of Community Bank to another financial institution.
FIVE-YEAR PERFORMANCE GRAPH
Set forth below is a line graph comparing the cumulative total stockholder
return on the Company's Common Stock, based on the market price change and
assuming reinvestment of dividends, with the cumulative total return of the
index for The NASDAQ Stock Market (US Companies) and the index for
Mid-Atlantic Bank Stocks (Delaware, Maryland, New Jersey, New York,
Pennsylvania and Washington, D.C. Companies) during the five-year period
ended December 31, 1999. The stockholder return shown on the graph and
table below is not necessarily indicative of future performance. The
Company's Common Stock began trading on The NASDAQ Stock Market under the
symbol "CCBP" on June 17, 1996. Prior to that date, the Company's Common
Stock was quoted on the Over-the-Counter Electronic Bulletin Board
Interdealer System.
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
- --------- Comm Bancorp, Inc. . . . . 100.0 106.6 202.5 280.4 226.7 320.7
- -- - - -- Total Returns Index
for The NASDAQ
Stock Market
(US Companies) . . . . . . 100.0 141.3 173.9 213.1 300.3 542.4
- - - - - - Total Returns Index
for Mid-Atlantic
Bank Stocks . . . . . . . 100.0 160.0 229.7 326.4 361.9 459.8
INDEPENDENT AUDITORS
PROPOSAL TO RATIFY THE APPOINTMENT OF KRONICK KALADA BERDY & CO.
Item 3 on Proxy Form
Kronick Kalada Berdy & Co., Certified Public Accountants, have audited the
consolidated financial statements of the Company and Community Bank for many
years, and the Board of Directors has appointed them for 2000. From time to
time Kronick Kalada Berdy & Co. also performs consulting work for the
Company. The firm has no other relationship with the Company or Community
Bank except the existing professional relationship as certified public
accountants. The Audit Committee and the Board of Directors believe that
Kronick Kalada Berdy & Co.'s long-term knowledge of the Company and Community
Bank is valuable to the Company. Representatives of Kronick Kalada Berdy &
Co. have direct access to members of the Audit Committee and regularly
attend their meetings.
A representative of Kronick Kalada Berdy & Co. will attend the meeting and
will have the opportunity to make a statement if he desires to do so. This
representative will also be available to respond to appropriate questions.
REQUIRED VOTE
The proposal will be approved if it receives the affirmative vote of a
majority of the shares of Common Stock represented in person or by proxy at
the meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR APPROVAL OF THE APPOINTMENT
OF KRONICK KALADA BERDY & CO. PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL
BE SO VOTED UNLESS YOU SPECIFY OTHERWISE.
OTHER INFORMATION
THIS SECTION SETS OUT OTHER INFORMATION YOU SHOULD KNOW BEFORE YOU VOTE.
TRANSACTIONS INVOLVING THE COMPANY'S DIRECTORS AND EXECUTIVE OFFICERS
The Company encourages its directors and executive officers to have banking and
financial transactions with Community Bank. All of these transactions are made
on comparable terms and with similar interest rates as those prevailing for
other customers.
The total consolidated loans made by the Company at December 31, 1999, to
its directors and officers as a group, members of their immediate families
and companies in which they have a 10% or more ownership interest was $4.1
million or 11.7% of the Company's total consolidated capital accounts. The
largest amount for all of these loans in 1999 was $4.2 million or 11.7% of
the Company's total consolidated capital accounts. During 1999, advances
and repayments on these loans were $3.5 million and $3.1 million,
respectively. These loans did not involve more than the normal risk of
collectibility nor did they present other unfavorable features.
NO SIGNIFICANT LEGAL PROCEEDINGS
The Company and Community Bank are not parties to any legal proceedings that
could have any significant effect upon the Company's financial condition or
income. In addition, the Company and Community Bank are not parties to any
legal proceedings under federal and state environmental laws.
OTHER PROPOSED ACTION
The Board of Directors is not aware of any other matters to be presented at
the meeting. If any other matters should properly come before the meeting,
the persons named in the enclosed proxy form will vote the proxies in
accordance with their best judgment.
STOCKHOLDER PROPOSALS AND NOMINATIONS FOR 2001 ANNUAL MEETING
Stockholder proposals for the 2001 Annual Meeting must be received by
November 24, 2000, to be considered for inclusion in the Company's 2001
Proxy Statement. Stockholder proposals for the 2001 Annual Meeting for
which the proponents do not desire them to be included in the Company's
2001 Proxy Statement must be received by February 14, 2001. Such proposals
should be addressed to the Secretary. Under the Company's Bylaws, notice of
any stockholder nomination for director must be given by mail or by personal
delivery to the Secretary no later than 60 days in advance of the meeting.
Stockholders wishing to make nominations should contact the Secretary as to
information required to be supplied in such otice.
ADDITIONAL INFORMATION AVAILABLE
THE COMPANY FILES AN ANNUAL REPORT ON FORM 10-K WITH THE SEC. STOCKHOLDERS MAY
OBTAIN A PAPER COPY OF THIS REPORT (WITHOUT EXHIBITS), WITHOUT CHARGE, BY
WRITING TO SCOTT A. SEASOCK, SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER,
COMM BANCORP, INC., 521 MAIN STREET, FOREST CITY, PA 18421; TELEPHONE:
(570) 586-0377.
IN ADDITION, A COPY OF THE ANNUAL DISCLOSURE STATEMENT OF COMMUNITY BANK MAY BE
OBTAINED, WITHOUT CHARGE, FROM SCOTT A. SEASOCK.
By order of the Board of Directors
/s/ William F. Farber, Sr.
- --------------------------
William F. Farber, Sr.
Chairman
Forest City, Pennsylvania
March 29, 2000
PROXY
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 28, 2000
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 Elk Mountain Ski
Resort, Route 374, Union Dale, Pennsylvania 18470, on Friday, April 28, 2000,
at 10:30 a.m., prevailing time, and at any adjournment or postponement
thereof as follows:
1. PROPOSAL TO FIX THE NUMBER OF DIRECTORS TO BE ELECTED AT THIRTEEN.
FOR AGAINST
---- ----
The Board of Directors recommends a vote FOR this proposal.
2. PROPOSAL TO ELECT THE NOMINEES AS DIRECTORS TO SERVE FOR A ONE-YEAR TERM.
FOR ALL NOMINEES LISTED BELOW WITHHOLD AUTHORITY - to
---- ----
(except as marked to the contrary vote for all nominees
below) listed below
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE, WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
David L. Baker, Thomas M. Chesnick, William F. Farber, Sr., Judd B. Fitze,
John P. Kameen, William A. Kerl, Erwin T. Kost, William B. Lopatofsky,
Robert A. Mazzoni, J. Robert McDonnell, Joseph P. Moore, III.,
Theodore W. Porosky, Eric G. Stephens
_____________________________________________________________________________
3. PROPOSAL TO RATIFY THE APPOINTMENT OF KRONICK KALADA BERDY & CO. AS THE
INDEPENDENT AUDITORS FOR THE COMPANY FOR THE YEAR ENDING DECEMBER 31,
2000.
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: ______________________, 2000
Number of Shares Held of Record on ______________________
January 31, 2000 - _______________
____________________________________
Signature(s) (Seal)
Please check this box if you plan to attend the Annual Meeting.
----
If so, number attending: __________
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.
