SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
F&M BANCORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $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.:
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(3) Filing party:
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(4) Date filed:
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<PAGE>
[F&M BANCORP LOGO]
110 Thomas Johnson Drive
Frederick, Maryland 21702
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of F&M Bancorp ("Bancorp") will be
held at the Corporate Headquarters, 110 Thomas Johnson Drive, Frederick,
Maryland, on Tuesday, April 15, 1997, at 10:00 a.m., for the following
purposes:
(1) To elect 16 directors of Bancorp;
(2) To consider and act upon amendments to Bancorp's Charter; and
(3) To consider and act upon such other business as may properly come
before the meeting.
Stockholders of Bancorp of record on January 24, 1997 will be entitled
to notice of and to vote at the meeting or any adjournments thereof.
By Order of the Board of Directors,
Gorton M. Cooley
Secretary
Frederick, Maryland
March 13, 1997
IMPORTANT -- YOUR PROXY IS ENCLOSED
Even though you plan to attend the annual meeting, please complete, date
and sign the enclosed proxy and promptly mail it in the return envelope
provided. No postage is required if mailed in the United States. If you attend
the annual meeting and decide that you wish to vote in person, or for any other
reason desire to revoke your proxy, you may do so at any time prior to its use.
<PAGE>
PROXY STATEMENT
INTRODUCTION
This Proxy Statement is furnished to stockholders of F&M Bancorp
("Bancorp") in connection with the solicitation of proxies by Bancorp's Board of
Directors to be used at the annual meeting of stockholders described in the
accompanying notice and at any adjournments thereof. The purpose of the meeting
is to elect 16 directors of Bancorp, to consider and act upon recommended
amendments to Bancorp's Charter and to transact such other business as may
properly come before the meeting. The Proxy Statement and the accompanying form
of proxy are first being sent to stockholders on or about March 13, 1997.
The record of stockholders entitled to notice of and to vote at the annual
meeting was taken as of the close of business on January 24, 1997. At that date
there were outstanding and entitled to vote 5,680,978 shares of Common Stock,
par value $5.00 per share.
The accompanying proxy is solicited by the Board of Directors of Bancorp.
The Board of Directors has selected Faye E. Cannon, David R. Stauffer, and Alice
E. Stonebreaker, or any two of them, to act as proxies with full power of
substitution. Any stockholder executing a proxy has the power to revoke the
proxy at any time before it is voted. This right of revocation is not limited or
subject to compliance with any formal procedure. Any stockholder may attend the
meeting and vote in person whether or not he has previously given a proxy.
In the election of directors, each share is entitled to one vote for each
director to be elected; cumulative voting is not permitted. For all other
matters each share is entitled to one vote.
The cost of solicitation of proxies and preparation of proxy materials will
be borne by Bancorp. Bancorp does not expect to compensate anyone for the
solicitation of proxies but may reimburse brokers and other persons holding
stock in their names, or in the names of nominees, for expenses they incur in
sending proxy materials to principals and in obtaining proxies. In addition to
solicitation of proxies by mail, proxies may be solicited personally or by
telephone or telegram by directors, officers, and employees of Bancorp, Farmers
and Mechanics National Bank (the "Bank"), or Home Federal Savings Bank (the
"Savings Bank") without additional compensation to them.
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth alphabetically, as of January 24, 1997, the
amount of the Company's Common Stock beneficially owned by each of its directors
and nominees, each executive officer named in the Summary Compensation Table,
and all directors and executive officers as a group, based upon information
obtained from such persons:
<TABLE>
<CAPTION>
TOTAL SHARES PERCENT
NAME OF INDIVIDUAL BENEFICIALLY OWNED OF CLASS
- ------------------- ------------------ --------
<S> <C> <C>
R. Carl Benna 9,976 *
Howard B. Bowen 8,349 (1) *
John D. Brunk 14,015 (2) *
Beverly B. Byron 600 *
Faye E. Cannon 14,166 (3) *
Martha E. Church 1,414 *
Albert H. Cohen 75,780 (4) 1.3
Gordon M. Cooley 15,840 (5) *
Maurice A. Gladhill 43,677 (6) *
Charles W. Hoff, III 18,793 (7) *
James K. Kluttz 300 *
Robert K. Moler 21,781 (8) *
Charles A. Nicodemus 36,668 (9) *
Richard W. Phoebus, Sr. 14,711 (10) *
David R. Stauffer 10,856 (11) *
Alice E. Stonebreaker 15,592 (12) *
H. Deets Warfield, Jr. 10,078 (13) *
John C. Warfield 17,257 (14) *
Thomas R. Winkler 1,136 *
All Executive Officers and
Directors as a group (25 persons) 412,011 (15)(16) 7.2
</TABLE>
* Indicates holdings of less than one percent
(1) Includes 880 shares in the form of options exercisable by Mr. Bowen within
60 days.
(2) Includes 9,814 shares owned by family members and as to which Mr. Brunk has
voting and disposition powers.
(3) Includes 3,303 shares owned jointly with family members and as to which Ms.
Cannon has joint voting and disposition powers and 10,631 shares in the
form of options exercisable within 60 days.
(4) Includes 48,558 shares owned jointly with a family member and as to which
Mr. Cohen has joint voting and disposition powers, and 18,824 shares owned
by family members and as to which Mr. Cohen has voting and disposition
powers.
(5) Includes 7,384 shares owned by family members and 5,487 shares in the form
of options exercisable by Mr. Cooley within 60 days.
(6) Includes 14,779 shares held jointly with family members and as to which Mr.
Gladhill has voting and disposition powers, 4,065 shares held by Mr.
Gladhill as custodian for his son, 6,589 shares owned by family members as
to which Mr. Gladhill has voting and disposition powers, and 4,500 shares
held in a family trust, of which Mr. Gladhill has voting and disposition
powers.
(7) Includes 2,204 shares owned by family members and as to which Mr. Hoff has
voting and disposition powers and 6,589 shares in the form of options
exercisable within 60 days.
(8) Includes 2,781 shares owned jointly with a family member and as to which
Mr. Moler has joint voting and disposition powers, 10,596 shares owned by a
corporation controlled by Mr. Moler and as to which he has voting and
disposition powers, and 2,565 shares owned by family members and as to
which Mr. Moler has voting and disposition powers.
(9) Includes 3,954 shares owned by a family member and as to which Mr.
Nicodemus has voting and disposition powers. Also includes 17,116 shares
owned by a mutual corporation of which Mr. Nicodemus is Chairman of the
Board of Directors and as to which Mr. Nicodemus has shared voting and
disposition powers but disclaims beneficial ownership.
(10) Includes 58 shares owned jointly with family members as to which Mr.
Phoebus has voting and disposition powers, 495 shares owned by family
members and as to which Mr. Phoebus has disposition and voting powers, and
5,551 shares in the form of options exercisable within 60 days.
(11) Includes 9,422 shares in the form of options exercisable by Mr. Stauffer
within 60 days.
(12) Includes 3,685 shares owned directly and 11,907 shares in the form of
options exercisable by Ms. Stonebreaker within 60 days.
(13) Includes 2,943 shares owned by family members and as to which Mr. H.
Warfield has voting and disposition powers.
(14) Includes 1,102 shares owned jointly with a family member and as to which
Mr. J. Warfield has joint voting and disposition powers and 14,178 shares
owned by family members as to which Mr. J. Warfield has voting and
disposition powers.
(15) Includes 62,705 shares in the form of options exercisable within 60 days.
(16) Includes 63,903 shares beneficially owned by Director George B. Delaplaine,
Jr. who is not standing for re-election because he has reached mandatory
retirement age for service as a director.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
To the knowledge of Bancorp, no person beneficially owns more than 5.0% of
the outstanding Common Stock of Bancorp, except the Trust Department of the Bank
which, according to a report filed with the Securities and Exchange Commission
on Schedule 13G, beneficially held as of December 31, 1996, 304,630 shares of
Bancorp Common Stock representing 5.3% of the outstanding shares. These shares
are held in multiple accounts, no one of which represents more than 5.0% of the
outstanding Common Stock of Bancorp, where the Bank acts as agent, trustee, or
personal representative for others, and were acquired in the normal course of
its trust business and not for the purpose of acquiring control of Bancorp.
ELECTION OF DIRECTORS
The entire Board of Directors of Bancorp will be elected to hold office
until the next annual meeting of stockholders and until their respective
successors are elected and have qualified. Sixteen persons, all of whom are
currently directors of Bancorp, are nominated as directors. Note, however, that
if the proposed amendments to Bancorp's Charter are approved by the
stockholders, then directors will be elected in classes with staggered terms
ranging from one to three years as detailed in Exhibit A.
It is the Board of Directors' intention that proxies not limited to the
contrary will be voted for the following nominees, or, in the event that any of
the nominees should be unable or unwilling to serve, for the election of such
other persons as may be nominated by the Board of Directors. A plurality of
votes is required to elect directors. Abstentions and broker non-votes will be
treated as shares not voted and will have no effect in the election of
directors.
INFORMATION CONCERNING NOMINEES
The following table presents information concerning persons nominated
by the Board of Directors for election as directors of Bancorp. Except as
indicated, the nominees have been officers of the organizations named below as
their principal occupations or of affiliated organizations for more than five
years. Information is reported as of January 24, 1997.
<TABLE>
<CAPTION>
Name of nominee Age, principal occupations, and
directorships with public companies
- --------------------------------------------------------------------------------
<S> <C>
R. Carl Benna Mr. Benna is 49 years old and has served as a
director of Bancorp since January 1989. He is
President of the North American Housing Corp.,
a modular housing manufacturer. (1)(2)(3)
- --------------------------------------------------------------------------------
Howard B. Bowen Mr. Bowen is 45 years old and has served as a
director of Bancorp since 1996. He is
President, Ewing Oil Co., Inc., a petroleum
distributor.
- --------------------------------------------------------------------------------
John D. Brunk Mr. Brunk is 59 years old and has served as a
director of Bancorp since 1983. He is
President of Frederick Produce Co., Inc., a
wholesale food service distributor. (2)
- --------------------------------------------------------------------------------
Beverly B. Byron Ms. Byron is 64 years old and has served as a
director of Bancorp since 1993. She is a
former member of the U.S. House of
Representatives for the 6th District of
Maryland. She is a member of the Boards of
Directors of the Baltimore Gas and Electric
Company, UNC, Inc., McDonnell Douglas Corp.,
BlueCross BlueShield of Maryland. (1)
- --------------------------------------------------------------------------------
Faye E. Cannon Ms. Cannon is 47 years old and has served as a
a director of Bancorp since 1993. She is
President and Chief Executive Officer of
Bancorp and the Bank. (3)(4)(5)(6)
- --------------------------------------------------------------------------------
Martha E. Church Dr. Church is 66 years old and has served as a
director of Bancorp since 1983. She is
President Emerita of Hood College, an
undergraduate liberal arts college for women,
with a graduate school which meets area
education needs, located in Frederick,
Maryland. (1)
- --------------------------------------------------------------------------------
Albert H. Cohen Mr. Cohen is 74 years old and has served as a
director of Bancorp since 1983. He is an
investor and building consultant. (3)(4)(5)
- --------------------------------------------------------------------------------
Maurice A. Gladhill Mr. Gladhill is 46 years old and has served as
a director of Bancorp since 1985. He is
President of Gladhill Tractor Mart, Inc., a
farm equipment dealership in Frederick,
Maryland. (2)(3)(4)
- --------------------------------------------------------------------------------
Charles W. Hoff, III Mr. Hoff is 62 years old and has served as a
director of Bancorp since 1983. He is Chairman
of the Board of Bancorp and the Bank.(3)(4)(5)
- --------------------------------------------------------------------------------
James K. Kluttz Mr. Kluttz is 55 years old and has served as a
director of Bancorp since 1996. He is
President and Chief Executive Officer of
Frederick Memorial Hospital (2)
- --------------------------------------------------------------------------------
Robert K. Moler Mr. Moler is 69 years old and has served as a
a director of Bancorp since 1995. He is Chief
Executive Officer of The Moler Company, an
investment and farming entity.
- --------------------------------------------------------------------------------
Charles A. Nicodemus Mr. Nicodemus is 67 years old and has served
as a director of Bancorp since 1983. He is
Chairman of the Board of Frederick Mutual
Insurance Company, a property insurance
company. (3)(4)(5)
- --------------------------------------------------------------------------------
Richard W. Phoebus, Sr. Mr. Phoebus is 58 years old and has served as
a director of Bancorp since 1996. He is
President and Chief Executive Officer of the
Savings Bank and Vice President of F&M
Bancorp.
- --------------------------------------------------------------------------------
H. Deets Warfield, Jr. Mr. Warfield is 65 years old and has served as
a director of Bancorp since 1983. He is
President of the Damascus Motor Co., Inc., an
automobile dealership. He is a member of the
Board of Directors of First Citizens Financial
Corporation. (4)(5)(7)
- --------------------------------------------------------------------------------
John C. Warfield Mr. Warfield is 67 years old and has served as
a director of Bancorp since 1983. He is
President of The Frederick Motor Co., an
automobile dealership. (1)(2)(3)(4)(7)
- --------------------------------------------------------------------------------
Thomas R. Winkler Mr. Winkler is 54 years old and has served as
a director of Bancorp since 1992. He is
Executive Vice President and Chief Operating
Officer of Bio Whittaker, Inc. (2)
- --------------------------------------------------------------------------------
</TABLE>
(1) Member of the Audit Committee.
(2) Member of the Personnel, Compensation and Stock Option Committee.
(3) Member of the Planning Committee.
(4) Member of the Executive Committee.
(5) Member of the Nominating Committee.
(6) Ms. Cannon and Alice E. Stonebreaker, Bancorp's Assistant Secretary and
Assistant Treasurer, are sisters.
(7) The Messrs. Warfield are not related. Mr. H. Warfield is the father-in-law
of Gordon M. Cooley, Bancorp's Secretary and Legal Officer.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND CERTAIN COMMITTEES
During 1996, there were 14 meetings of the Board of Directors of Bancorp.
Each of the directors attended at least 75% of the combined total number of
meetings of the Board of Directors and board committees of which he or she is a
member (held during the period for which he or she has been a director), except
Mr. Bowen who attended one of two (50%) meetings and Mr. Delaplaine who attended
22 of 30 (73%) meetings. The Board of Directors of Bancorp has, among others, a
Nominating Committee, an Audit Committee and a Personnel, Compensation and Stock
Option Committee.
The Nominating Committee of Bancorp is responsible for recommending persons
to serve as new directors and met twice during 1996. Members of the Nominating
Committee are designated by note (5) above. Nominations for director which are
presented to the Nominating Committee by stockholders are considered, along with
those developed by the Nominating Committee, in light of the needs of Bancorp,
as well as the nominee's individual knowledge, experience and background.
The Audit Committee of Bancorp meets with Bancorp's internal and
independent auditors to review whether satisfactory accounting procedures are
being followed by Bancorp and subsidiaries and whether internal accounting
controls are adequate, to inform itself with regard to non-audit services
performed by the independent auditors and to review fees charged by the
independent auditors. The Audit Committee also recommends to the Board of
Directors the selection of independent auditors. The Audit Committee met 8 times
in 1996, and members are designated by note (1) above.
The Personnel, Compensation and Stock Option Committee of Bancorp
establishes the compensation for executive officers of Bancorp, the Bank, and
commencing in 1997, the Savings Bank, reviews generally all personnel issues,
and administers Bancorp's 1983 and 1995 Stock Option Plans and the Executive
Supplemental Income Plan. During 1996, the directors designated by note (2)
above were members of the Personnel, Compensation and Stock Option Committee of
Bancorp. The Personnel, Compensation and Stock Option Committee met on 4
occasions during 1996.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Personnel, Compensation and Stock Option Committee of the Board of
Directors (the "Committee") has furnished the following report on executive
compensation.
The Committee establishes the compensation for executive officers of
Bancorp, the Bank and, commencing in 1997, the Savings Bank (collectively, "the
Corporation"), reviews, generally, all personnel issues and administers
Bancorp's 1983 and 1995 Stock Option Plans and the Executive Supplemental Income
Plan. In 1996, the Committee did not administer compensation and benefits for
the Savings Bank officers and employees because the merger of the Savings Bank
and its parent Home Federal Corporation into Bancorp did not occur until
November 15, 1996. Compensation and benefits programs for officers and employees
of the Savings Bank were established and administered by the Savings Bank and
its parent. In 1997, the Committee will review the Savings Bank compensation and
benefits packages as per the merger agreement and coordinate them with those of
the Bank to insure that they support and accomplish the Committee's goals for
the Corporation as a whole as detailed herein. Committee objectives include
administration of a total compensation package that allows the Corporation to
attract and retain qualified persons to fill key executive positions and to
effectively utilize incentive compensation programs which are directly related
to executive officers accomplishing corporate goals and objectives, both
operational and financial, aimed at achieving lasting improvement in the
Corporation's long-term financial performance.
The Committee utilizes the human resources' staff, and, as appropriate,
other qualified consultants to review actual performance of the Chief Executive
Officer and all executive officers and the Corporation's compensation practices
as they compare to industry norms.
Compensation program components include:
1. Base salary - Base pay levels are established within a range for each
position determined, by routinely updated survey data, through comparison with
similar positions at other companies, both financial and non-financial, of like-
size and performance located in the geographic area in which the Corporation
does business and at other financial institutions of similar size, business make
up and performance characteristics located outside the Corporation's market
area. Actual salaries are based on the individual performance and experience of
each executive officer.
2. Annual incentive compensation - In 1996 the Corporation adopted an
incentive compensation program for executive and other designated officers at
the Bank (the "Program") replacing both the annual bonus and merit bonus
programs previously used to compensate executives. The Program was designed in
conjunction with an independent consultant and is similar to existing plans of
other banks and financial service companies. The Program, like these plans in
in general, requires a considerable degree of specificity with regard to
performance measures and evaluations and establishes threshold, target, and
maximum incentive amounts which are benchmarked to industry incentive practices
(banks and financial service companies in the region and nationally). Bonuses
under the Program are paid based on both Bank-wide and individual performance.
The Program allows the Compensation Committee to establish annually both the
performance measures to be used and the threshold, target, and maximum levels of
each of these performance measures in conjunction with the goals in the
Corporation's strategic plan. In 1996 Bank-wide objectives were based on return
on assets and net income. Similarly, individual performance components are
based upon goals established for each individual executive and senior officer
senior officer as a part of the Bank's Employee Performance, Management and
Development Process ("PMDP") and in 1996 related to profitability, expense
control, new clients/customers, specific project completions/milestones, and
human resource management. Executives are eligible for incentive compensation
expressed as a percentage of their base salaries for meeting either or both
individuals and Bank-wide goals, so long as they obtain a PMDP rating of at
least "meet requirements". Levels of incentive compensation increases as
executive officers and the Bank itself achieve beyond threshold to target and
maximum levels of performance. In 1996 the named executive officers received
compensation under the Incentive Compensation Program as a result of meeting
individual and Bank-wide performance objectives.
3. Stock option program - The Corporation maintains 1983 and 1995 Stock
Option Plans which provide for the grant of options to executive and other key
officers, in the Committee's discretion, who have substantial responsibility for
the management and growth of the Corporation. The Committee believes that grants
of stock options, which allow employees to purchase shares of the Common Stock
of the Corporation at specified prices in the future, aligns employees'
interests in corporate performance with the interests of all stockholders. Each
year the Committee determines the number of options, if any, to be granted the
recipients of grants in order to achieve these objectives. Incentive stock
options are granted at the market price of F&M Bancorp stock on the date of
grant. Non-qualified options are granted at 85% of market price on the date of
grant. The Committee considers it significant that officers receiving incentive
stock option awards will profit from those awards only if, and only to the
extent that, the market price of F&M Bancorp stock appreciates following the
date of grant.
In 1996 the Committee established Mr. Hoff's salary with reference to
salary ranges determined in the salary survey for Chief Executive Officers for
that portion of 1996 during which Mr. Hoff served in the capacity as the
Corporation's Chief Executive Officer. Following the Annual Meeting in April
1996, at which time Ms. Cannon was elected Chief Executive Officer, Mr. Hoff's
salary was adjusted to reflect the reduced role he agreed to assume as Chairman
of the Board of Bancorp and the Bank.
The Compensation Committee established Ms. Cannon's salary with reference
to the salary ranges determined in the same survey for Chief Executive Officers
beginning in April 1996 when she assumed responsibility as Chief Executive
Officer of the Corporation.
The Committee considers the Chief Executive Officer responsible for overall
corporate performance, both operational and financial. As such, 100% of the
Chief Executive Officer's potential bonus under the Corporation's Incentive
Compensation Program is related to Corporate performance and 0% related to the
Chief Executive Officer's individual performance. The Committee finds that the
total compensation package for each of the persons serving as Chief Executive
Officer in 1996 were justified based on competitive market data and overall
corporate performance, both financial and operational. The Compensation
Committee took specific notice of Ms. Cannon's role in negotiating and
completing the acquisition of Home Federal Corporation and the Savings Bank as
well as the continued development of the Bank's technological capabilities
including Bank-On-It, its commercial business PC banking service, and
preparation for a personal home PC banking service, as well as the successful
conversion of the Bank's data processing system to a larger, updated platform
capable of serving the Corporation's needs in the coming years and completion of
the corporate headquarters' expansion.
The Committee believes that the total compensation awarded to the Chief
Executive Officer and executives of the Corporation is consistent with the
Committee's objectives. The amounts paid to individual executives are consistent
with competition within the market and with banks of similar size (as reflected
by the salary survey), individual performance of each executive, and, for
incentive compensation, are rationally linked with the fulfillment of corporate
objectives and corporate financial performance.
Personnel, Compensation and Stock
Option Committee of the Board of Directors:
Thomas R. Winkler, Chairman
R. Carl Benna
John D. Brunk
Maurice Gladhill
James K. Kluttz
John C. Warfield
The following table sets forth compensation information with respect to the
Chief Executive Officers serving at any time in 1996 and the four next highest
paid executive officers in 1996 (the "Named Executive Officers").
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term
Annual Compensation
Compensation (1) Awards
---------------- -------
Options All Other
Bonus Shares Compensation
Name and Principal Position Year Salary (2) (3) (4)
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Charles W. Hoff, III 1996 $ 91,667 $36,667 3,000 --
Chairman of Bancorp 1995 186,650 51,526 3,412 $10,712
and of the Bank(5) 1994 176,700 60,169 3,307 12,465
Faye E. Cannon 1996 173,700 72,560 3,000 --
President and CEO of 1995 161,700 41,719 3,412 10,712
Bancorp and of the Bank(6) 1994 152,050 47,839 3,307 12,465
David R. Stauffer 1996 153,000 50,689 2,500 --
Vice President of Bancorp 1995 148,000 32,977 2,835 10,712
and Executive Vice 1994 144,000 38,093 2,756 12,465
President of the Bank
Gordon M. Cooley 1996 106,100 19,894 900 --
Secretary of Bancorp and 1995 97,933 19,613 1,155 7,574
Senior Vice President 1994 93,500 22,517 1,102 8,648
of the Bank
Alice E. Stonebreaker 1996 90,000 29,817 2,200 --
Assistant Secretary and 1995 85,000 18,626 2,520 6,789
Assistant Treasurer of 1994 71,764 18,921 1,102 6,588
Bancorp and Senior Vice
President of the Bank
Patti A. Stuckey 1996 90,000 29,817 2,200 --
Senior Vice President 1995 81,208 18,394 2,520 6,459
of the Bank 1994 65,500 18,748 1,653 6,195
(1) No Named Executive Officer received any perquisites in 1994, 1995, or 1996,
the aggregate amount of which exceeded 10% of the officer's salary and
bonus.
(2) Includes in 1996 bonus paid under Bank's Incentive Compensation Plan and in
1995 and 1994 both annual bonus paid to substantially all employees and
merit bonuses.
(3) Adjusted to reflect 5% stock dividends paid on May 23, 1994 and May 22,
1995.
(4) Includes Bancorp contribution to the account of each Named Executive
Officer in Bancorp's defined contribution Employee Benefit Plan (the
"Plan") qualified under Section 401(k) of the Internal Revenue Code for
both profit-sharing portion and corporate match of Named Executive
Officer's individual contributions to the Plan up to 2% of salary in 1994
and 1995, and up to 3% in 1996, with a salary cap of $150,000. Dollar
values of each contribution for 1996 will not be finally calculated until
after mailing date of the Proxy Statement but will be included in the 1998
Proxy Statement.
(5) Mr. Hoff served as CEO from January 1, 1996 to April 16, 1996.
(6) Ms. Cannon served as CEO from April 16, 1996 through year end.
</TABLE>
The following table sets forth information with respect to stock option
grants to the Chief Executive Officers serving in 1996 and the Named Executive
Officers for the fiscal year ended December 31, 1996. Bancorp does not grant
stock appreciation rights.
<TABLE>
<CAPTION>
OPTIONS GRANTED IN 1996
-----------------------
Potential
Realizable Value
at Assumed Annual
Rates of Stock
Price Appreciation
Individual Grants for Option Term
- ----------------------------------------------------------- --------------------
% of Total
Options Market
Granted Price on
Options to Exercise Date of
Granted Employees Price Grant
(1) in Fiscal (per (per Expiration
Name (shares) 1995 share) share) Date 0% 5% 10%
- ------------ -------- --------- -------- ------- ---------- -- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Charles W.
Hoff, III 3,000 9.80% $29.13 $29.13 3/19/06 0 $54,950 $139,253
Faye E.
Cannon 3,000 9.80 29.13 29.13 3/19/06 0 54,950 139,253
David R.
Stauffer 2,500 8.17 29.13 29.13 3/19/06 0 45,791 116,044
Gordon M.
Cooley 900 2.94 29.13 29.13 3/19/06 0 16,485 41,776
Alice E.
Stonebreaker 2,200 7.19 29.13 29.13 3/19/06 0 40,296 102,119
Patti A.
Stuckey 2,200 7.19 29.13 29.13 3/19/06 0 40,296 102,119
(1) All options granted on March 19, 1996. Options exercisable to the extent
of 25%, 50%, 75% and 100% on March 19, 1997, 1998, 1999 and 2000,
respectively.
</TABLE>
The following table sets forth information with respect to the value of all
options exercised during the fiscal year ended December 31, 1996 and the value
of all options held on December 31, 1996 by the Chief Executive Officers serving
in 1996 and the Named Executive Officers.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
OPTION VALUES AT DECEMBER 31, 1996
Number of Number of Shares Value of Unexercised
Shares Underlying Unexercised In-the-Money Options
Acquired Value Options at 12/31/96(2) at 12/31/96(3)
on Realized------------------------- -------------------------
Name Exercise (1) Exercisable Unexercisable Exercisable Unexercisable
- ----------- -------- ------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Charles W.
Hoff, III 7,010 $104,969 3,333 8,038 $17,787 $9,882
Faye E.
Cannon -0- -0- 8,512 7,901 61,340 8,876
David R.
Stauffer -0- -0- 6,710 6,693 47,851 8,241
Gordon M.
Cooley 4,199 19,218 4,423 2,591 30,978 3,289
Alice E.
Stonebreaker 1,249 19,465 12,284 5,191 78,252 5,315
Patti A.
Stuckey 1,875 21,287 1,044 5,191 957 3,927
(1) Based on the difference between aggregate fair market value on date of
exercise and aggregate exercise price.
(2) Adjusted to reflect stock dividends paid between dates of grant and
December 31, 1996.
(3) Based on the difference between aggregate fair market value at December
31, 1996 and aggregate exercise price.
</TABLE>
Termination Of Employment And Change In Control Arrangements
Bancorp provides an Executive Supplemental Income Plan (the "Supplemental
Plan") in which Executive Officers Cannon, Hoff and Stauffer participate. The
Supplemental Plan provides certain benefits which are integrated with the
benefits provided Executive Officers Cannon, Hoff and Stauffer under Bancorp's
defined contribution employee benefit plan qualifying under Section 401(k) of
the Internal Revenue Code. The Supplemental Plan provides for retirement
benefits to Executive Officers Cannon and Stauffer based on 65% (and 75% for
Executive Officer Hoff) of their cash compensation including salary and bonuses
as measured by the greater of (a) compensation paid during the 12 months
immediately preceding retirement or (b) the average compensation paid during the
three consecutive years of employment that yield the highest average.
The Supplemental Plan also provides for benefits upon termination of
employment following a change in control of the Bank or Bancorp. A change in
control is defined as the acquisition of 25% or more of the combined voting
power of the Bank or Bancorp, or a change in the majority of the members of the
Board of Directors of the Bank or Bancorp during any two-year period. In the
event of a termination of employment after a change in control, full
compensation benefits will be paid to a participant in the Supplemental Plan
until the third anniversary of the change in control. Thereafter, benefits will
be based on a fraction of final compensation as detailed above. Assuming current
compensation practices continue to retirement, in conjunction with current
assumptions relating to contributions to and performance of Bancorp's 401(k)
Plan and current assumptions relating to future levels of Social Security
benefits, Executive Officers Cannon, Hoff and Stauffer would have estimated
annual benefits under the Supplemental Plan of $_______, $_______, and $_______,
respectively.
The Supplemental Plan also provides for a death benefit equal to 50% of a
participant's cash compensation if the participant dies while still employed.
Directors' Fees And Deferred Compensation Plan
During 1996, each director of Bancorp received a quarterly director's fee
of $250 plus $50 for each board meeting attended. Each director of Bancorp who
also served as a director of the Bank received a quarterly fee of $1,500 plus
$400 for each board meeting attended. Each director of Bancorp who also served
as a director of the Savings Bank received a fee of $200 for each board meeting
attended. Fees for attendance at each committee meeting of Bancorp, the Bank,
and the Savigns Bank are $100 for each director except full-time officers. Each
director who is not also an officer of Bancorp, the Bank, or the Savings Bank
may elect to defer all or part of these fees until he or she ceases to be a
director. Interest is earned on the deferred amount at a rate floating equal to
the "prime rate" as published in the Wall Street Journal's Money Rates Table on
December 15th of each year for the next calendar year, currently 8.25%. Payment
of the deferred amount may be made to the director or his or her beneficiary in
a lump sum or in equal monthly installments over 10 years.
Certain Transactions with Directors and Officers
During the past year Bancorp and its subsidiaries have had, and expect to
have in the future, banking transactions in the ordinary course of their
businesses with directors and officers of Bancorp and the Bank and with their
affiliates on substantially the same terms, including interest rates,
collateral, and repayment terms on loans, as those prevailing at the same time
for comparable transactions with others. The extensions of credit did not
involve and do not currently involve more than the normal risk of collectibility
or present other unfavorable features.
The Bank purchased advertising and related services totaling $77,336 in
1995 from the Great Southern Printing and Manufacturing Co. of which Director
George B. Delaplaine, Jr. is President. The Bank purchased automobiles and
related services totaling $62,327 in 1995 from the Frederick Motor Company of
which Director John C. Warfield is President.
Stockholder Return Performance Graph
The following graph compares the cumulative total return of Bancorp's
Common Stock with that of a broad market index (NASDAQ Stock Market, U.S.
Companies only) and an industry peer group index (NASDAQ Bank Stocks).
Information is provided for the five year period ending December 31, 1996. The
graph assumes that the value of the investment in Bancorp's Common Stock and
each index was $100 on December 31, 1991 and that all dividends were reinvested.
COMPARISON OF FIVE-YEAR
CUMULATIVE RETURN
[GRAPH]
<TABLE>
<CAPTION>
DECEMBER 31,
- --------------------------------------------------------------------------------
1991 1992 1993 1994 1995 1996
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
F&M BANCORP 100 137 173 233 257 214
- --------------------------------------------------------------------------------
NASDAQ US COMPANIES 100 116 134 131 185 227
- --------------------------------------------------------------------------------
NASDAQ BANK STOCKS 100 146 166 165 246 326
- --------------------------------------------------------------------------------
</TABLE>
PROPOSAL TO ADOPT AMENDMENTS TO BANCORP'S CHARTER
The Board of Directors proposes that the stockholders of Bancorp approve
amendments to Bancorp's Charter. Attached to this Proxy Statement as Exhibit A
is a copy of the current Charter, incorporating all previous amendments and
containing all proposed amendments. Words lined through represent existing
provisions recommended for deletion. Words underlined represent provisions
recommended for addition. The proposed amendments have been reviewed,
considered, and recommended by the Executive Committee to the full Board of
Directors and by the full Board to the stockholders. Bancorp's goals in
recommending the amendments are to update the documents to reflect current
practices and new opportunities as well as to position Bancorp to do business
in a multi-subsidiary environment. Amendments to the Charter are also designed
to add appropriate anti-takeover defenses. The amendment to increase the number
of shares authorized will provide flexibility for stock option grants, stock
dividends, and stock for additional merger and acquisition activity. The
The amendment to classify the Board of Directors will provide greater
continuity of management in the event a single shareholder or group of
shareholders takes a dominant position in Bancorp's stock. The delineation of
the permissible factors to be considered in exercising business judgment will
allow the Board to consider factors in addition to price when evaluating a
takeover proposal. The proposals, individually and collectively, are recognized
as legitimate provisions to accomplish recognized and appropriate corporate
objectives and have been adopted by a number of companies.
Approval of the amendments requires the affirmative vote of a majority of
the outstanding shares entitled to vote. Abstentions and broker non-votes will
have the effect of a vote against the amendments.
The following summary description of the proposed amendments is qualified
in its entirety by reference to the full text of the proposed amendments in
Exhibit A.
Article Sixth is proposed to be amended to increase the number of shares of
stock Bancorp has authority to issue from 10,000,000 to 50,000,000, all
initially to be classified as Common Stock and with a par value of $5.00 per
share, and to make certain stylistic and clarifying revisions. Bancorp believes
it appropriate to increase the number of authorized shares so as to provide
availability for future stock dividends and splits, for Bancorp's Dividend
Reinvestment Plan and Employee Stock Purchase Plan, for stock option grants, for
the raising of additional capital, for future merger and acquisition activity,
and for other corporate purposes. Bancorp's Common Stock trades on the NASDAQ
National Market under the symbol FMBN. No shares so authorized have been
committed for any purpose nor does Bancorp have present plans to register or
issue any of the shares so authorized. The increase in the number of authorized
shares will not operate to change the preferences or rights of holders of the
stock. The Board of Directors currently has the authority to classify and
reclassify the capital stock of the Corporations pursuant to Article Sixth.
Suggested amendments to Article Sixth could have the affect of delaying,
deferring, or preventing a change in control of Bancorp, through, for example,
the ability to issue additional stock and thereby dilute the stock ownership of
persons who may be seeking to obtain control of Bancorp. The proposed amendments
are not the result of any knowledge on the part of management of any effort to
obtain control of Bancorp nor is it the result of any attempt by management to
make take-overs more difficult.
Article Seventh is proposed to be amended to create a classified Board of
Directors. Currently all directors are elected annually to serve one year terms.
The proposed amendments provide that the directors be divided into three classes
of approximately equal numbers. Each director is elected to serve a three year
term and one class of directors will stand for re-election each year. In 1997,
approximately one-third of the directors are elected to serve a three year term,
approximately one-third to serve a two year term and approximately one-third to
serve a one year term to begin the process. Where applicable, directors have
been assigned a class that will stand for re-election at the next annual meeting
following their 70th birthday such that the current mandatory retirement age of
70 is observed. The number of directors can be increased or decreased by
two-thirds vote of the directors then in office pursuant to the By-laws of
Bancorp. Vacancies occurring during the year may be filled by vote of
stockholders or the directors. If filled by the remaining directors, the
director so elected shall serve until the next annual meeting. If filled by
stockholders the director so elected shall serve for the balance of the term
then remaining.
A classified Board of Directors promotes continuity on the board and in
decision making. Bancorp believes the classified board will also be a deterrent
to unwanted and unsolicited attempts to gain control of Bancorp. The proposed
amendment provides that directors may only be removed for cause and then only by
a vote of at least 80% of all shares outstanding voting as a single class.
Article Eighth is proposed to be amended to more fully and accurately
reflect the current ability Bancorp has under the laws of the State of Maryland
to indemnify directors and officers under certain circumstances and to provide
Bancorp the authority to indemnify employees in certain circumstances also. The
current Charter provides for indemnification of directors and officers in
Article Eighth, subparagraph (5). Stockholders should recognize that members of
the Board of Directors and executive officers have a personal interest in this
matter; however, the Board of Directors believes the amendment to be in the best
interests of Bancorp and its stockholders. The amendment will enhance the
ability of Bancorp to attract and retain the best qualified persons as
directors, officers, and employees and to have these persons exercise
entrepreneurial decision-making without threat of litigation seeking money
damages. As of the dates of the Proxy Statement, Directors and executive
officers of Bancorp are not aware of any pending or threatened litigation or
claims against the Directors or executive officers that would result in their
being indemnified.
Article Eighth is proposed to be amended to expand the factors the Board
may consider in exercising its business judgment involving extraordinary
activities such as a change in control of Bancorp. The Bank has developed a
values statement recognizing its obligations to customers, employees, Bancorp's
stockholders, and the communities it serves. By focusing its efforts to meet
customer needs and recognizing the importance of the needs of employees,
stockholders, and its community, the Bank has identified a strategy that will,
if accomplished, consistently benefit all four of the groups. Bancorp has
committed to remain independent and to look for merger and acquisition
activities that will further expand its geographic and customer based. The
enumerated factors in Article Eighth recognize these decisions and support these
efforts.
Article Eighth is also proposed to be amended to require an 80% majority to
amend the provisions of the classified Board in Article Seventh and the
permissible factors to be considered by the Board in evaluating a change in
control event in Article Eighth. Bancorp believes it important to its long-term
success to provide for the continuation of these provisions once adopted.
Finally, Article Eighth is proposed to be amended to provide that certain
extraordinary events involving Bancorp (including mergers, consolidations,
transfers of all or substantially all of its assets, and dissolutions and
certain Charter amendments) need be approved only by a simple majority vote
rather than a two-thirds majority vote. Bancorp believes the time and expense of
soliciting a two-thirds majority vote to be unnecessary in these instances.
The Board of Directors of Bancorp has deemed the proposed amendments
advisable and recommends the proposed amendments to the stockholders of the
Corporation for their approval.
AUDIT COMMITTEE AND INDEPENDENT PUBLIC ACCOUNTANTS
The accounting firm of Arthur Anderson LLP has acted as Bancorp's
independent public accountants for the year ended December 31, 1996 and has been
recommended by the Audit Committee and selected by the Board of Directors to act
as such for the current fiscal year. A partner of Arthur Andersen LLP is
expected to be present at the annual meeting and will have an opportunity to
make a statement if he desires and to respond to appropriate questions.
On July 9, 1996 Bancorp dismissed its former independent public accounts,
Keller Bruner & Company, L.L.C., ("KB") on the recommendation and approval of
the Audit Committee which was ratified by the full Board after an extensive
review and analysis of submitted proposal from nine accounting firms, including
KB. In reaching its decision, the Audit Committee considered such factors as
depth of management, range of experience, available in-house resources, and
technical expertise in mergers and acquisitions, the thrift industry, taxation
issues and other industry matters. Keller Bruner & Company, L.L.C. was not
dismissed as the result of any disagreement. The reports of KB on the financial
statements of the Registrant for each of the two fiscal years in the period
ended December 31, 1995 did not contain any adverse opinion or disclaimer of
opinion and were not qualified or modified as to uncertainty, auditing scope or
accounting principles. During the two fiscal years in the period ended December
31, 1995 and the subsequent interim periods preceding such dismissal, there were
no disagreements on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure or any reportable event.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based upon review of Forms 3, 4, and 5 and amendments thereto furnished to
the Corporation and inquiry to directors and executive officers, all required
reports of securities activities were timely filed.
OTHER MATTERS
The management of Bancorp knows of no matters to be presented for action at
the annual meeting other than those mentioned above; however, if any other
matters properly come before the annual meeting, it is intended that the persons
named in the accompanying proxy will vote on such other matters in accordance
with their judgment of the best interests of Bancorp. Each such matter generally
requires the affirmative vote of a majority of the shares voted on the matter.
Abstentions and broker non-votes generally will be treated as shares not voted
and will have no effect.
STOCKHOLDER PROPOSALS
Stockholders' proposals intended to be presented at the 1998 Annual Meeting
must be received by Bancorp for inclusion in Bancorp's Proxy Statement and form
of proxy relating to that meeting by ________________, 1997.
ANNUAL REPORT ON FORM 10-K
A copy of the annual report on form 10-K, as filed with the Securities
and Exchange Commission, is available without charge upon written request to
__________________, _______________________, at corporate headquarters.
By Order of the Board of Directors,
Gordon M. Cooley
Secretary
Frederick, Maryland
March 13, 1997
<PAGE>
EXHIBIT A
---------
F&M BANCORP
RESTATED ARTICLES OF INCORPORATION
(Restated as of March __, 1995, not filed for record)
FIRST: THE UNDERSIGNED, Henry D. Kahn, whose address is 1100 Charles
Center South, 36 South Charles Street, Baltimore, Maryland 21201, being at least
eighteen years of age, acting as incorporator, does hereby form a corporation
under the General Laws of the State of Maryland.
SECOND: The name of the corporation (which is hereinafter called the
"Corporation") is:
F&M BANCORP
THIRD: The purposes for which and any of which the Corporation is formed
and the business and objects to be carried on and promoted by it are:
(1) To acquire by purchase, subscription or otherwise, and to
receive, hold, own, guarantee, sell, assign, exchange, transfer, mortgage,
pledge or otherwise dispose of or deal in and with any and all securities, as
such term is hereinafter defined, issued or created by any corporation, firm,
organization, association or other entity, public or private, whether formed
under the laws of the United States of America or of any state, commonwealth,
territory, dependency or possession thereof, or of any foreign country or of
any political subdivision, territory, or issued or created by the United States
of America or any state or commonwealth thereof or any foreign country, or by
any agency, subdivision, territory, dependency, possession or municipality of
any of the foregoing, and as owner thereof to possess and exercise all the
rights, powers and privileges of ownership, including the right to execute
consents and vote thereon, and to do any and all acts and things necessary or
advisable for the preservation, protection, improvement and enhancement in value
thereof.
The term "securities" as used in this Article shall mean any and all
notes, stocks, treasury stocks, bond debentures, evidences of indebtedness,
certificates of interest or participation in any profit-sharing agreement,
collateral-trust certificates, preorganization certificates or subscriptions,
transferable shares, investment contracts, voting trust certificates,
certificates of deposit for a security, fractional undivided interests in oil,
gas, or other mineral rights, or, in general, any interests or instruments
commonly known as "securities", or any and all certificates of interest or
participation in, temporary or interim certificates for, receipts for,
guaranties of, or warrants or rights to subscribe to or purchase, any of the
foregoing.
(2) To engage in any one or more businesses or transactions, or to
acquire all or any portion of any entity engaged in any one or more businesses
or transactions which the Board of Directors may from time to time authorize or
approve, whether or not related to the business described elsewhere in this
Article or to any other business at the time or theretofore engaged in by the
Corporation.
The foregoing enumerated purposes and objects shall be in no way limited or
restricted by reference to, or inference from, the terms of any other clause of
this or any other article of the charter of the Corporation, and each shall be
regarded as independent; and they are intended to be and shall be construed as
powers as well as purposes and objects of the Corporation and shall be in
addition to and not in limitation of the general powers of corporations under
the General Laws of the State of Maryland.
FOURTH: The present address of the principal office of the Corporation in
this State is 110 Thomas Johnson Drive, Frederick, Maryland 21702.
FIFTH: The name and address of the resident agent of the Corporation in
this State are Gordon M. Cooley, 110 Thomas Johnson Drive, Frederick, Maryland
21702. Said resident agent is a citizen of the State of Maryland who resides
there.
SIXTH: (a) The total number of shares of stock of all classes which the
Corporation has authority to issue is 10,000,000 50,000,000 shares of
Common CAPITAL Stock (par value $5.00 per share), amounting in aggregate
par value to $50,000,000 250,000,000. All of such shares are initially
classified as "Common Stock." The Board of Directors may classify and reclassify
any unissued shares of capital stock by setting or changing in any one or more
respects the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications, or terms or
conditions of redemption of such shares of CAPITAL stock.
(b) The following is a description of the preferences, conversion and
other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption of the Common Stock of
the Corporation.
(1) Each share of Common Stock shall have one vote and, except as
otherwise provided in respect of any class of stock hereafter classified or
reclassified, the exclusive voting power for all purposes shall be vested in the
holders of the Common Stock.
(2) Subject to the provisions of law and any preferences of any class
of stock hereafter classified or reclassified, dividends INCLUDING DIVIDENDS
PAYABLE IN SHARES OF ANOTHER CLASS OF THE CORPORATION'S STOCK may be paid on the
Common Stock of the Corporation at such time and in such amounts as the Board of
Directors may deem advisable.
(3) In the event of any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the holders of the Common Stock
shall be entitled, after payment or provision for payment of the debts and other
liabilities of the Corporation and the amount to which the holders of any class
of stock hereafter classified or reclassified having a preference on
distribution in the liquidation, dissolution or winding up of the Corporation
shall be entitled, together with the holders of any other class of stock
hereafter classified or reclassified not having a preference on distributions in
the liquidation, dissolution, or winding up of the Corporation, to share ratably
in the remaining net assets of the Corporation.
(c) Subject to the foregoing, the power of the Board of Directors to
classify and reclassify any of the shares of capital stock shall include,
without limitation, subject to the provisions of the charter, authority to
classify or reclassify any unissued shares of such stock into a class or classes
of preferred stock, preference stock, special stock, or other stock, and to
divide and classify shares of any class into one or more series of such class,
by determining, fixing, or altering one or more of the following:
(1) The distinctive designation of such class or series and the
number of shares to constitute such class or series; provided that, unless
otherwise prohibited by the terms of such or any other class or series, the
number of shares of any class or series may be decreased by the Board of
Directors in connection with any classification or reclassification of unissued
shares and the number of shares of such class or series may be increased by the
Board of Directors in connection with any such classification or
reclassification, and any shares of any class or series which have been
redeemed, purchased, otherwise acquired, or converted into shares of Common
Stock or any other class or series shall become part of the authorized Common
CAPITAL stock and be subject to classification and reclassification as provided
in this Section.
(2) Whether or not and, if so, the rates, amounts and times at which,
and the conditions under which, dividends shall be payable on shares of such
class or series, whether any such dividends shall rank senior or junior to or on
a parity with the dividends payable on any other class or series of stock, and
the status of any such dividends as cumulative, cumulative to a limited extent,
or non-cumulative and as participating or non-participating.
(3) Whether or not shares of such class or series shall have voting
rights, in addition to any voting rights provided by law and, if so, the terms
of such voting rights.
(4) Whether or not shares of such class or series shall have
conversion or exchange privileges and, if so, the terms and conditions thereof,
including provision for adjustment of the conversion or exchange rate in such
events or at such times as the Board of Directors shall determine.
(5) Whether or not shares of such class or series shall be subject to
redemption and, if so, the terms and conditions of such redemption, including
the date or dates upon or after which they shall be redeemable and the amount
per share payable in case of redemption, which amount may vary under different
conditions and at different redemption dates; and whether or not there shall be
any sinking fund or purchase account in respect thereof, and if so, the terms
thereof.
(6) The rights of the holders of shares of such class or series upon
the liquidation, dissolution, or winding up of the affairs of, or upon any
distribution of the assets of, the Corporation, which rights may vary depending
upon whether such liquidation, dissolution, or winding up is voluntary or
involuntary and, if voluntary, may vary at different dates, and whether such
rights shall rank senior or junior to or on a parity with such rights of any
other class or series of stock.
(7) Whether or not there shall be any limitations applicable, while
shares of such class or series are outstanding, upon the payment of dividends or
making of distributions on, or the acquisition of, or the use of moneys for
purchase or redemption of, any stock of the Corporation, or upon any other
action of the Corporation, including action under this Section
SUBPARAGRAPH, and, if so, the terms and conditions thereof.
(8) Any other preferences, rights, restrictions, including
restrictions on transferability, and qualifications of shares of such class or
series, not inconsistent with law and the charter of the Corporation.
(d) For the purposes hereof and of any articles supplementary to the
charter providing for the classification or reclassification of any shares of
capital stock or of any other charter document of the Corporation (unless
otherwise PROVIDED in any such articles or document), any class or series of
stock of the Corporation shall be deemed to rank:
(1) prior to another class or series either as to dividends or upon
liquidation, if the holders of such class or series shall be entitled to the
receipt of dividends or of amounts distributable on liquidation, dissolution, or
winding up, as the case may be, in preference or priority to holders of such
other class or series;
(2) on a parity with another class or series either as to dividends
or upon liquidation, whether or not the dividend rates, dividend payment dates,
or redemption or liquidation price per share thereof be different from those of
such others, if the holders of such class or series of stock shall be entitled
to receipt of dividends or amounts distributable upon liquidation, dissolution,
or winding up, as the case may be, in proportion to their respective dividend
rates or redemption or liquidation prices, without preference or priority over
the holders of such other class or series; and
(3) junior to another class or series either as to dividends or upon
liquidation, if the rights of the holders of such class or series shall be
subject or subordinate to the rights of the holders of such other class or
series in respect of the receipt of dividends or the amounts distributable upon
liquidation, dissolution, or winding up, as the case may be.
SEVENTH: The number of directors of the Corporation shall be thirteen
(13), which number may be increased or decreased pursuant to the By-Laws of the
Corporation, but shall never be less than the minimum number permitted by the
General Laws of the State of Maryland now or hereafter in force. The names of
the directors who serve as director until the 1995 annual meeting and until
their successors are elected and qualify are as follows:
R. Carl Benna George B. Delaplaine, Jr.
John D. Brunk Maurice A. Gladhill
Beverly B. Byron Charles W. Hoff, III
Faye E. Cannon Charles A. Nicodemus
Martha E. Church H. Deets Warfield, Jr.
Albert H. Cohen John C. Warfield
Thomas R. Winkler
(A) THE NUMBER OF DIRECTORS OF THE CORPORATION SHALL BE 16, WHICH NUMBER
MAY BE INCREASED OR DECREASED BY AT LEAST TWO-THIRDS OF THE DIRECTORS THEN IN
OFFICE PURSUANT TO THE BY-LAWS OF THE CORPORATION, BUT SHALL NEVER BE LESS THAN
THE MINIMUM NUMBER PERMITTED BY THE GENERAL LAWS OF THE STATE OF MARYLAND NOW OR
HEREAFTER IN FORCE.
(B) SUBJECT TO THE RIGHTS OF THE HOLDERS OF ANY CLASS OF PREFERRED STOCK
THEN OUTSTANDING, NEWLY INCREASED DIRECTORSHIPS RESULTING FROM ANY INCREASE IN
THE AUTHORIZED NUMBER OF DIRECTORS OR ANY VACANCIES ON THE BOARD OF DIRECTORS
RESULTING FROM DEATH, RESIGNATION, RETIREMENT, DISQUALIFICATION, REMOVAL FROM
OFFICE, OR OTHER CAUSE SHALL BE FILLED BY THE REQUIRED VOTE OF THE STOCKHOLDERS
OR THE DIRECTORS THEN IN OFFICE. A DIRECTOR SO CHOSEN BY THE STOCKHOLDERS SHALL
HOLD OFFICE FOR THE BALANCE OF THE TERM THEN REMAINING. A DIRECTOR SO CHOSEN BY
THE REMAINING DIRECTORS SHALL HOLD OFFICE UNTIL THE NEXT ANNUAL MEETING OF
STOCKHOLDERS, AT WHICH TIME THE STOCKHOLDERS SHALL ELECT A DIRECTOR TO HOLD
OFFICE FOR THE BALANCE OF THE TERM THEN REMAINING. NO DECREASE IN THE NUMBER OF
DIRECTORS CONSTITUTING THE BOARD OF DIRECTORS SHALL AFFECT THE TENURE OF OFFICE
OF ANY DIRECTOR.
(C) WHENEVER THE HOLDERS OF ANY ONE OR MORE SERIES OF PREFERRED STOCK OF
THE CORPORATION SHALL HAVE THE RIGHT, VOTING SEPARATELY AS A CLASS, TO ELECT ONE
OR MORE DIRECTORS OF THE CORPORATION, THE BOARD OF DIRECTORS SHALL CONSIST OF
SAID DIRECTORS SO ELECTED IN ADDITION TO THE NUMBER OF DIRECTORS FIXED AS
PROVIDED ABOVE IN PARAGRAPH (A) OF THIS ARTICLE SEVENTH OR IN THE BY-LAWS.
NOTWITHSTANDING THE FOREGOING, AND EXCEPT AS OTHERWISE MAY BE REQUIRED BY LAW,
WHENEVER THE HOLDERS OF ANY ONE OR MORE SERIES OF PREFERRED STOCK OF THE
CORPORATION SHALL HAVE THE RIGHT, VOTING SEPARATELY AS A CLASS, TO ELECT ONE OR
MORE DIRECTORS OF THE CORPORATION, THE TERMS OF THE DIRECTOR OR DIRECTORS
ELECTED BY SUCH HOLDER SHALL EXPIRE AT THE NEXT SUCCEEDING ANNUAL MEETING OF
STOCKHOLDERS.
(D) SUBJECT TO THE RIGHTS OF THE HOLDERS OF ANY CLASS SEPARATELY ENTITLED
TO ELECT ONE OR MORE DIRECTORS, ANY DIRECTOR, OR THE ENTIRE BOARD OF DIRECTORS,
MAY BE REMOVED FROM OFFICE AT ANY TIME, BUT ONLY FOR CAUSE AND THEN ONLY BY THE
AFFIRMATIVE VOTE OF THE HOLDERS OF AT LEAST 80% OF THE COMBINED VOTING POWER OF
ALL CLASSES OF SHARES OF CAPITAL STOCK ENTITLED TO VOTE IN THE ELECTION FOR
DIRECTORS VOTING TOGETHER AS A SINGLE CLASS.
(E) AT EACH ANNUAL MEETING OF STOCKHOLDERS BEGINNING IN 1997, SUCCESSORS
TO THE CLASS OF DIRECTORS WHOSE TERM EXPIRES AT THAT ANNUAL MEETING SHALL BE
ELECTED FOR A THREE YEAR TERM.
(1) THE FOLLOWING PERSONS SHALL SERVE AS DIRECTORS UNTIL THE 1998
ANNUAL MEETING OF STOCKHOLDERS:
HOWARD B. BOWEN
MARTHA E. CHURCH
ALBERT H. COHEN
CHARLES W. HOFF, III
ROBERT K. MOLER
(2) THE FOLLOWING PERSONS SHALL SERVE AS DIRECTORS UNTIL THE 1999
ANNUAL MEETING OF STOCKHOLDERS:
JOHN D. BRUNK
FAYE E. CANNON
CHARLES A. NICODEMUS
H. DEETS WARFIELD
JOHN C. WARFIELD
(3) THE FOLLOWING PERSONS SHALL SERVE AS DIRECTORS UNTIL THE 2000
ANNUAL MEETING OF STOCKHOLDERS:
R. CARL BENNA
BEVERLY B. BYRON
MAURICE A. GLADHILL
JAMES K. KLUTTZ
RICHARD W. PHOEBUS
THOMAS R. WINKLER
EIGHTH: The following provisions are hereby adopted for the purpose of
defining, limiting, and regulating the powers of the Corporation and of the
directors and stockholders:
(1) The Board of Directors is hereby empowered to authorize the
issuance from time to time of shares of its stock of any class, whether now or
hereafter authorized, or securities convertible into shares of its stock of any
class or class or classes, whether now or hereafter authorized, for such
consideration as may be deemed advisable by the Board of Directors and without
any action by the stockholders.
(2) No holder of any stock or any other securities of the
Corporation, whether now or hereafter authorized, shall have any preemptive
right to subscribe for or purchase any stock or any other securities of the
Corporation other than such, if any, as the Board of Directors, in its sole
discretion, may determine and at such price or prices and upon such other terms
as the Board of Directors, in its sole discretion, may fix; and any stock or
other securities which the Board of Directors may determine to offer for
subscription may, as the Board of Directors in its sole discretion shall
determine, be offered to the holders of any class, series or type of stock or
other securities at the time outstanding to the exclusion of the holders of any
or all other classes, series or types of stock or other securities at the time
outstanding.
(3) The Board of Directors shall have power from time to time and in
its sole discretion to determine in accordance with sound accounting practice,
what constitutes annual or other net profits, earnings, surplus, or net assets
in excess of capital; to fix and vary from time to time the amount to be
reserved as working capital, or determine that retained earnings or surplus
shall remain in the hands of the Corporation; to set apart out of any funds of
the Corporation such reserve or reserves in such amount or amounts and for such
proper purpose or purposes as it shall determine and to abolish any such reserve
or any part thereof; to distribute and pay distributions or dividends in stock,
cash or other securities or property, out of surplus or any other funds or
amounts legally available therefor, at such times and to the stockholders of
record on such dates as it may, from time to time, determine; and to determine
whether and to what extent and at what times and places and under what
conditions and regulations the books, accounts and documents of the Corporation,
or any of them, shall be open to the inspection of stockholders, except as
otherwise provided by statute or by the By-Laws, and, except as so provided,
no stockholder shall have any right to inspect any book, account or document
of the Corporation unless authorized so to do by resolution of the Board of
Directors.
(4) A contract or other transaction between the Corporation and any
of its directors or between the Corporation and any other corporation, firm or
other entity in which any of its directors is a director or has a material
financial interest is not void or voidable solely because of any one or more of
the following: the common directorship or interest; the presence of the
director at the meeting of the Board of Directors which authorizes, approves or
ratifies the contract or transaction; or the counting of the vote of the
director for the authorization, approval or ratification of the contract or
transaction. This Paragraph (4) applies if:
(a) the fact of the common directorship or interest is disclosed
or known to: the Board of Directors and the Board authorizes, approves or
ratifies the contract or transaction by the affirmative vote of a majority of
disinterested directors, even if the disinterested directors constitute less
than a quorum; or the stockholders entitled to vote, and the contract or
transaction is authorized, approved, or ratified by a majority of the votes cast
by the stockholders entitled to vote other than the votes of shares owned of
record or beneficially by the interested director or corporation, firm, or other
entity; or
(b) the contract or transaction is fair and reasonable to the
Corporation.
Common or interested directors or the stock owned by them or by an
interested corporation, firm, or other entity may be counted in determining the
presence of a quorum at a meeting of the Board of Directors or at a meeting of
the stockholders, as the case may be, at which the contract or transaction is
authorized, approved or ratified. If a contract or transaction is not
authorized, approved or ratified in one of the ways provided for in clause (a)
of the second sentence of this Paragraph (4), the person asserting the validity
of the contract or transaction bears the burden of proving that the contract or
transaction was fair and reasonable to the Corporation at the time it was
authorized, approved, or ratified. The procedures in this Paragraph (4) do not
apply to the fixing by the Board of Directors of reasonable compensation for a
director, whether as a director or in any other capacity.
(5) The Corporation shall indemnify (a) its directors to the full
extent provided by the general laws of the State of Maryland now or hereafter in
force, including the advance of expenses under the procedures provided by such
laws; (b) its officers to the same extent it shall indemnify its directors; and
(c) its officers who are not directors to such further extent as shall be
authorized by the Board of Directors and be consistent with law. The foregoing
shall not limit the authority of the Corporation to indemnify other employees
and agents consistent with law.
(5) THE CORPORATION SHALL INDEMNIFY (A) ITS DIRECTORS AND OFFICERS,
WHETHER SERVING THE CORPORATION OR AT ITS REQUEST ANY OTHER ENTITY, TO THE FULL
EXTENT REQUIRED OR PERMITTED BY THE GENERAL LAWS OF THE STATE OF MARYLAND NOW OR
HEREAFTER IN FORCE, INCLUDING THE ADVANCE OF EXPENSES UNDER THE PROCEDURES AND
TO THE FULL EXTENT PERMITTED BY LAW AND (B) OTHER EMPLOYEES AND AGENTS TO SUCH
EXTENT AS SHALL BE AUTHORIZED BY THE BOARD OF DIRECTORS OR THE CORPORATION'S BY-
LAWS AND BE PERMITTED BY LAW. THE FOREGOING RIGHTS OF INDEMNIFICATION SHALL NOT
BE EXCLUSIVE OF ANY OTHER RIGHTS TO WHICH THOSE SEEKING INDEMNIFICATION MAY BE
ENTITLED. THE BOARD OF DIRECTORS MAY TAKE SUCH ACTION AS IS NECESSARY TO CARRY
OUT THESE INDEMNIFICATION PROVISIONS AND IS EXPRESSLY EMPOWERED TO ADOPT,
APPROVE AND AMEND FROM TIME TO TIME SUCH BY-LAWS, RESOLUTIONS OR CONTRACTS
IMPLEMENTING SUCH PROVISIONS OR SUCH FURTHER INDEMNIFICATION ARRANGEMENTS AS MAY
BE PERMITTED BY LAW. NO AMENDMENT OF THE CHARTER OF THE CORPORATION OR REPEAL OF
ANY OF ITS PROVISIONS SHALL LIMIT OR ELIMINATE THE RIGHT TO INDEMNIFICATION
PROVIDED HEREUNDER WITH RESPECT TO ACTS OR OMISSIONS OCCURRING PRIOR TO SUCH
AMENDMENT OR REPEAL.
(6) To the fullest extent permitted by Maryland statutory or
decisional law, as amended or interpreted, no director or officer of this
Corporation shall be personally liable to the Corporation or its stockholders
for money damages. No amendment of the charter of the Corporation or repeal of
any of its provisions shall limit or eliminate the benefits provided to
directors and officers under this provision with respect to any act or omission
which occurred prior to such amendment or repeal.
(7) THE BOARD OF DIRECTORS SHALL, IN CONNECTION WITH THE EXERCISE OF
ITS BUSINESS JUDGMENT INVOLVING A BUSINESS COMBINATION (AS DEFINED IN SECTION 3-
601 OF THE CORPORATIONS AND ASSOCIATIONS ARTICLE OF THE ANNOTATED CODE A
MARYLAND) OR ANY ACTUAL OR PROPOSED TRANSACTION WHICH WOULD OR MAY INVOLVE A
CHANGE IN CONTROL OF THE CORPORATION (WHETHER BY PURCHASES OR SHARES OF STOCK OR
ANY OTHER SECURITIES OF THE CORPORATION IN THE OPEN MARKET, OR OTHERWISE, TENDER
OFFER, MERGER, CONSOLIDATION, DISSOLUTION, LIQUIDATION, SALE OF ALL OR
SUBSTANTIALLY ALL OF THE ASSETS OF THE CORPORATION, PROXY SOLICITATION OR
OTHERWISE), IN DETERMINING WHAT IS IN THE BEST INTERESTS OF THE CORPORATION AND
ITS STOCKHOLDERS AND IN MAKING ANY RECOMMENDATION TO ITS STOCKHOLDERS, GIVE DUE
CONSIDERATION TO ALL RELEVANT FACTORS, INCLUDING, BUT NOT LIMITED TO (A) THE
ECONOMIC EFFECT, BOTH IMMEDIATE AND LONG-TERM, UPON THE CORPORATION'S
STOCKHOLDERS, INCLUDING STOCKHOLDERS, IF ANY, NOT TO PARTICIPATE IN THE
TRANSACTION; (B) THE SOCIAL AND ECONOMIC EFFECT ON THE EMPLOYEES, DEPOSITORS AND
CUSTOMERS OF, AND OTHERS DEALING WITH, THE CORPORATION AND ITS SUBSIDIARIES AND
ON THE COMMUNITIES IN WHICH THE CORPORATION AND ITS SUBSIDIARIES OPERATE OR ARE
LOCATED; (C) WHETHER THE PROPOSAL IS ACCEPTABLE BASED ON THE HISTORICAL AND
CURRENT OPERATING RESULTS OR FINANCIAL CONDITION OF THE CORPORATION; (D) WHETHER
A MORE FAVORABLE PRICE COULD BE OBTAINED FOR THE CORPORATION'S STOCK OR OTHER
SECURITIES IN THE FUTURE; (E) THE REPUTATION AND BUSINESS PRACTICES OF THE
OFFEROR AND ITS MANAGEMENT AND AFFILIATES AS THEY WOULD AFFECT THE EMPLOYEES OF
THE CORPORATION AND ITS SUBSIDIARIES; (F) THE FUTURE VALUE OF THE STOCK OR ANY
OTHER SECURITIES OF THE CORPORATION; (G) ANY ANTITRUST OR OTHER LEGAL AND
REGULATORY ISSUES THAT ARE RAISED BY THE PROPOSAL; AND (H) THE BUSINESS AND
FINANCIAL CONDITION AND EARNINGS PROSPECTS OF THE ACQUIRING PERSON OR ENTITY,
INCLUDING, BUT NOT LIMITED TO, DEBT SERVICE AND OTHER EXISTING FINANCIAL
OBLIGATIONS, FINANCIAL OBLIGATIONS TO BE INCURRED IN CONNECTION WITH THE
ACQUISITION, AND OTHER LIKELY FINANCIAL OBLIGATIONS OR THE ACQUIRING PERSON OR
ENTITY. IF THE BOARD OF DIRECTORS DETERMINES THAT ANY PROPOSED BUSINESS
COMBINATION (AS DEFINED IN SECTION 3-601 OF THE CORPORATIONS AND ASSOCIATIONS
ARTICLE OF THE ANNOTATED CODE OF MARYLAND) OR ACTUAL OR PROPOSED TRANSACTION
WHICH WOULD OR MAY INVOLVE A CHANGE IN CONTROL OF THE CORPORATION SHOULD BE
REJECTED, IT MAY TAKE ANY LAWFUL ACTION TO DEFEAT SUCH TRANSACTION, INCLUDING,
BUT NOT LIMITED TO, ANY OR ALL OF THE FOLLOWING; ADVISING STOCKHOLDERS NOT TO
ACCEPT THE PROPOSAL; INSTITUTING LITIGATION AGAINST THE PARTY MAKING THE
PROPOSAL; FILING COMPLAINTS WITH GOVERNMENTAL AND REGULATORY AUTHORITIES;
ACQUIRING THE STOCK OR ANY OF THE SECURITIES OF THE CORPORATION; SELLING OR
OTHERWISE ISSUING AUTHORIZED BUT UNISSUED STOCK, OTHER SECURITIES OR TREASURY
STOCK OR GRANTING OPTIONS WITH RESPECT THERETO; ACQUIRING A COMPANY TO CREATE AN
ANTITRUST OR OTHER REGULATORY PROBLEM FOR THE PARTY MAKING THE PROPOSAL; AND
OBTAINING A MORE FAVORABLE OFFER FROM ANOTHER INDIVIDUAL OR ENTITY.
( 7 8) The Corporation reserves the right from time to time to
make any amendments of its charter which may now or hereafter be authorized by
law, including any amendments changing the terms of contract rights, as
expressly set forth in its charter, of any of its outstanding stock by
classification, reclassification or otherwise; but no such amendment which
changes such terms or contract rights of any of its outstanding stock shall be
valid unless such amendment shall have been authorized by not less than a
majority of the aggregate number of the votes entitled to be cast thereon, by a
vote at a meeting or in writing with or without a meeting.
The enumeration and definition of particular powers of the Board of
Directors included in the foregoing shall in no way be limited or restricted by
reference to or inference from the terms of any other clause of this or any
other Article of the charter of the Corporation, or construed as or deemed by
inference or otherwise in any manner to exclude or limit any powers conferred
upon the Board of Directors under the General Laws of the State of Maryland now
or hereafter in force. ;PROVIDED, HOWEVER, THAT ANY AMENDMENT TO, REPEAL OF OR
ADOPTION OF ANY PROVISION INCONSISTENT WITH ARTICLE SEVENTH OR SUB-PARAGRAPH (7)
OF ARTICLE EIGHTH, OR THIS SUBPARAGRAPH OF ARTICLE EIGHTH, PARAGRAPH (A) SHALL
HAVE BEEN AUTHORIZED BY NOT LESS THAN 80% OF THE AGGREGATE VOTES ENTITLED TO BE
CAST THEREON (CONSIDERED FOR THIS PURPOSE AS A SINGLE CLASS), BY VOTE AT A
MEETING OR IN WRITING WITH OR WITHOUT A MEETING.
(9) EXCEPT AS PROVIDED IN THESE ARTICLES OF INCORPORATION, NOTWITHSTANDING
ANY PROVISION OF LAW REQUIRING THE AUTHORIZATION OF ANY ACTION BY A GREATER
PROPORTION THAN A MAJORITY OF THE TOTAL NUMBER OF SHARES OF ALL CLASSES OF
CAPITAL STOCK OR OF THE TOTAL NUMBER OF SHARES OF ANY CLASS OF CAPITAL STOCK,
SUCH ACTION SHALL BE VALID AND EFFECTIVE IF AUTHORIZED BY THE AFFIRMATIVE VOTE
OF THE HOLDERS OF A MAJORITY OF THE TOTAL NUMBER OF SHARES OF ALL CLASSES
OUTSTANDING AND ENTITLED TO VOTE THEREON, EXCEPT AS OTHERWISE PROVIDED IN THE
CHARTER.
NINTH: The duration of the Corporation shall be perpetual.
IN WITNESS WHEREOF, I have signed these Articles of Incorporation,
acknowledging the same to be my act, on December 6, 1983.
Witness:
G. P. Stamas /s/ Henry D. Kahn
Henry D. Kahn
[Note for EDGAR version: Text contained between tags and represents
existing provisions recommended for deletion and text in all capitals represent
provisions recommended for addition.]
<PAGE>
F&M BANCORP
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
THE UNDERSIGNED STOCKHOLDER of F&M Bancorp hereby appoints Faye E. Cannon, Alice
E. Stonebreaker, and David R. Stauffer, or any two of them, the lawful attorneys
and proxies of the undersigned with full power of substitution to vote, as
designated below, all shares of Common Stock of the Corporation which the
undersigned is entitled to vote at the Annual Meeting of Stockholders called to
convene at 10:00 a.m. on April 15, 1997, and at any and all adjournments thereof
with respect to the matters set forth below and described in the Notice of
Annual Meeting and Proxy Statement dated March 13, 1997, receipt of which is
hereby acknowledged.
1. ELECTION OF 16 DIRECTORS
/ / FOR all nominees listed below as / / WITHHOLD AUTHORITY to vote
recommended by the Board of Directors for all nominees listed
below (except as marked
to the contrary)
R. BENNA, H. BOWEN, J. BRUNK, B. BYRON, F. CANNON, M. CHURCH, A. COHEN,
M. GLADHILL, C. HOFF, J. KLUTTZ, R. MOLER, C. NICODEMUS, R. PHOEBUS,
H. WARFIELD, J. WARFIELD AND T. WINKLER
(INSTRUCTION: To withhold authority for any individual nominee, strike a
line through the nominee's name in the list above)
2. AMENDMENTS TO BANCORP'S CHARTER
/ / FOR / / AGAINST / / ABSTAIN
3. IN THEIR DISCRETION, on such other matters as may properly come before the
meeting.
(Please mark, date and sign the reverse side)
<PAGE>
CONTINUED FROM OTHER SIDE
SHARES REPRESENTED BY ALL PROPERLY EXECUTED PROXIES WILL BE VOTED (OR THE VOTE
ON SUCH MATTERS WILL BE WITHHELD ON SPECIFIC MATTERS) IN ACCORDANCE WITH
INSTRUCTIONS APPEARING ON THE PROXY. IN THE ABSENCE OF SPECIFIC INSTRUCTIONS,
PROXIES WILL BE VOTED FOR PROPOSAL 1 AND IN THE BEST DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS.
Dated , 1997
---------------------------------------------
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(Signature)
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(Signature)
Please date and sign exactly as name(s) appears
at left. If joint account, both owners should sign.
(PROXY INFORMATION APPEARS ON THE REVERSE SIDE. PLEASE MARK, DATE, SIGN,
AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.)
