SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
[X] Filed by the Registrant
[ ] 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 Sec. 240.14a-11(c) or
Sec. 240.14a-12
TOWER BANCORP, INC.
-------------------------------------------------
(Name of Registrant as Specified in Its Charter)
SHUMAKER WILLIAMS, P.C.
------------------------------------------------
(Name of Person(s) Filing Proxy Statement if
other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No filing fee required.
<PAGE>
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and O-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 O-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
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
TOWER BANCORP, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 1, 1998
TO THE SHAREHOLDERS OF TOWER BANCORP, INC.:
Notice is hereby given that the Annual Meeting of Shareholders of Tower
Bancorp, Inc. (the "Corporation") will be held at 1:30 p.m., prevailing time, on
Wednesday April 1, 1998, at the Rescue Hose Company Special Events Center, 407
South Washington Street, Greencastle, Pennsylvania 17225, for the following
purposes:
1. To elect two (2) Class B Directors to serve for a three- (3) year term
and until their successors are elected;
2. To consider and act upon a proposal to amend and restate Article 5a of
the Corporation's Articles of Incorporation to eliminate par value for
the Corporation's common stock and preferred stock;
3. To ratify the selection of Smith Elliott Kearns & Company, LLC,
Certified Public Accountants, as the independent auditors for the
Corporation for the year ending December 31, 1998; and
4. To transact such other business as may properly come before the Annual
Meeting and any adjournment or postponement thereof.
In accordance with the By-laws of the Corporation and action of the Board
of Directors, only those shareholders of record at the close of business on
February 13, 1998, will be entitled to notice of and to vote at the Annual
Meeting and any adjournment or postponement thereof.
A copy of the Corporation's Annual Report for the fiscal year ended
December 31, 1997, is enclosed with this Notice. Copies of the Corporation's
Annual Report for the 1996 fiscal year may be obtained by contacting Jeff B.
Shank, President, Tower Bancorp, Inc., P.O. Box 8, Center Square, Greencastle,
Pennsylvania 17225; (717) 597-2137.
You are urged to mark, sign, date and promptly return your proxy in the
enclosed envelope so that your shares may be voted in accordance with your
wishes and in order that the presence of a quorum may be assured. The prompt
return of your signed proxy, regardless of the number of shares you hold, will
aid the Corporation in reducing the expense of additional proxy solicitation.
The giving of such proxy does not affect your right to vote in person if you
attend the meeting and give written notice to the Secretary of the Corporation.
By Order of the Board of Directors,
Jeff B. Shank, President
March 2, 1998
<PAGE>
TOWER BANCORP, INC.
PROXY STATEMENT FOR THE ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON APRIL 1, 1998
GENERAL
Introduction, Date, Time and Place of Annual Meeting
This proxy statement is furnished for the solicitation by the Board of
Directors of Tower Bancorp, Inc. (the "Corporation"), a Pennsylvania business
corporation, of proxies to be voted at the Annual Meeting of Shareholders of the
Corporation to be held on Wednesday, April 1, 1998, at 1:30 p.m., prevailing
time, at the Rescue Hose Company Special Events Center, 407 South Washington
Street, Greencastle, Pennsylvania 17225, and at any adjournment or postponement
of the Annual Meeting.
The main office of the Corporation is located at Center Square,
Greencastle, Pennsylvania 17225. The telephone number for the Corporation is
(717) 597-2137. The Corporation has one wholly owned subsidiary, The First
National Bank of Greencastle (the "Bank"). All inquiries should be directed to
Jeff B. Shank, President of the Corporation and the Bank.
Solicitation and Voting of Proxies
This proxy statement and the enclosed form of proxy (the "Proxy") are first
being sent to shareholders of the Corporation on or about March 2, 1998. Shares
represented by proxies on the accompanying proxy, if properly signed and
returned, will be voted in accordance with the specifications made thereon by
the shareholders. Any proxy not specifying to the contrary will be voted: for
the election of the nominees for directors named below; for the elimination of
par value with respect to the Corporation's securities; for the ratification of
the selection of Smith Elliott Kearns & Company, LLC as the independent auditors
for the Corporation for the year ending December 31, 1998; and for the
transaction of such other business as may properly come before the Annual
Meeting and any adjournment or postponement thereof. Execution and return of the
enclosed proxy will not affect a shareholder's right to attend the Annual
Meeting and vote in person, after giving written notice to the Secretary of the
Corporation. A shareholder that returns a proxy may revoke it at any time before
it is voted by delivering written notice of revocation to John McDowell, Sr.,
Secretary of Tower Bancorp, Inc., at P.O. Box 8, Greencastle, Pennsylvania
17225.
<PAGE>
The cost of preparing, assembling, printing, mailing and soliciting
proxies, and any additional material that the Corporation may furnish
shareholders in connection with the Annual Meeting, will be borne by the
Corporation. In addition to the use of the mails, certain directors, officers
and employees of the Corporation and of the Bank may solicit proxies personally,
by telephone, telegraph and telecopier. Arrangements will be made with brokerage
houses and other custodians, nominees and fiduciaries to forward proxy
solicitation material to the beneficial owners of stock held of record by the
persons and, upon request therefor, the Corporation will reimburse them for
their reasonable forwarding expenses.
Revocability of Proxy
A shareholder who returns a proxy may revoke the proxy at any time before
it is voted only: (1) by giving written notice of revocation to John McDowell,
Sr., Secretary of Tower Bancorp, Inc., at P.O. Box 8, Greencastle, Pennsylvania
17225; (2) by executing a later-dated proxy and giving written notice thereof to
the Secretary of the Corporation; or (3) by voting in person after giving
written notice to the Secretary of the Corporation.
Record Date, Voting Securities, and Quorum
At the close of business on February 13, 1998, the Corporation had
outstanding 883,098 shares of common stock, par value $2.50 per share, the only
issued and outstanding class of stock (the "Common Stock"). The record date for
the Annual Meeting is February 13, 1998. Only holders of Common Stock of record
at the close of business on February 13, 1998 will be entitled to notice of and
to vote at the Annual Meeting. The Corporation is also authorized to issue
500,000 shares of Preferred Stock, par value $2.50 per share, none of which have
been issued. On all matters to come before the Annual Meeting, each share of
Common Stock is entitled to one vote. Cumulative voting rights do not exist with
respect to the election of directors.
Under Pennsylvania law and the By-laws of the Corporation, the presence of
a quorum is required for each matter to be acted upon at the Annual Meeting. The
presence, in person or by proxy, of shareholders entitled to cast at least a
majority of the votes that all shareholders are entitled to cast constitutes a
quorum for the transaction of business at the Annual Meeting. Votes withheld and
abstentions will be counted in determining the presence of a quorum. Broker
non-votes will not be counted in determining the presence of a quorum for the
particular matter as to which the broker withheld authority.
Assuming the presence of quorum, the two- (2) nominees for director
receiving the highest number of votes cast by shareholders entitled to vote for
the election of directors shall be elected. Votes withheld from a nominee and
broker non-votes will not be cast for such nominee.
Assuming the presence of a quorum, the affirmative vote of a majority of
the votes cast by all shareholders entitled to vote thereon is required for
elimination of par value with respect to the Corporation's securities and for
ratification of the selection of the independent auditors. Abstentions and
broker non-votes are not deemed to constitute "votes cast" and, therefore, do
not count either for or against such ratification. Abstentions and broker
non-votes, however, have the practical effect of reducing the number of
affirmative votes required to achieve a majority for each matter by reducing the
total number of shares voted from which the required majority is calculated.
<PAGE>
PRINCIPAL BENEFICIAL OWNERS OF THE CORPORATION'S STOCK
Principal Owners
The following table sets forth, as of February 13, 1998, the name and
address of each person who owns of record or who is known by the Board of
Directors to be the beneficial owner of more than 5 percent (5%) of the
Corporation's outstanding Common Stock. The number of shares beneficially owned
by such person and the percentage of the Corporation's outstanding Common Stock
so owned. Shares beneficially owned reflect a 100% stock split effected in the
form of a dividend paid on May 15, 1996, and a 5% stock dividend paid on July
21,1997(the "Stock Dividends").
<TABLE>
<CAPTION>
Percent of Outstanding
Number of Shares Common Stock
Name and Address Beneficially Owned(1) Beneficially Owned
- ---------------- --------------------- ------------------
<S> <C> <C>
CEDE & Co. 172,234 19.44
Box #20
Bowling Green Station
New York, NY 10004
First National Bank
of Greencastle 111,843 1262
Trust Department
Center Square
P.O. Box 8
Greencastle, PA 17225
- ---------------
<FN>
(1) The securities "Beneficially Owned" by an individual are determined in
accordance with the definitions of "Beneficial Ownership" set forth in
the general rules and regulations of the Securities and Exchange
Commission and may include securities owned by or for the individual's
spouse and minor children and any other relative who has the same home,
as well as securities to which the individual has or shares voting or
investment power or has the right to acquire beneficial ownership
within 60 days after February 13 1998, Beneficial ownership may be
disclaimed as to certain of the securities.
</FN>
</TABLE>
Beneficial Ownership by Officers, Directors and Nominees
The following table sets forth, as of February 13, 1998, and from
information supplied by the respective persons, the amount and the percentage,
if over one percent (1%), of the Common Stock of the Corporation beneficially
owned (as defined in footnote No. 1, above) by each director, each nominee for
director and all officers and directors of the Corporation as a group. Unless
otherwise noted shares are held directly by the respective individual. The
shares beneficially reflect the Stock Dividends.
<PAGE>
<TABLE>
<CAPTION>
Name of Individual or Amount and Nature of
Identity of Group Beneficial Ownership Percent of Class(7)
- ------------------ -------------------- -------------------
<S> <C> <C>
Current Class A Directors
(to serve until 2000)
Harold C. Gayman 8,194(1)
James H. Craig, Jr. 2,608(2) --
Nominees for Class B Directors
(to serve until 2001)
Betty J. Lehman 6,091(3)
Jeff B. Shank 7,020(4)
--
Current Class C Directors
(to serve until 1999)
Robert L. Pensinger 3,883(5) --
Kermit G. Hicks 14,866(6) 1.68%
Lois Easton 2,205(2) --
All Officers, Directors and 54,657 6.17%
Nominees as a Group (10 persons)
- ----------------------
<FN>
(1) Includes 3,827 shares held by Mr. Gayman's spouse. On January 13, 1998,
Mr. Gayman received options to purchase 357 shares under the Directors'
Plan. These options are not exercisable for one year from the date of
grant. In addition, Mr. Gayman has options to purchase 162 shares of
Common Stock, which options are exercisable March 6, 1997, and 340
shares which options are exercisable January 8, 1998. The additional
502 shares were added to the shares currently held by Mr. Gayman and to
total outstanding shares, assuming all exercisable options were
exercised.
<PAGE>
(2) Holds 162 options to purchase Common Stock, which options are
exercisable March 6, 1997, and options to purchase 340 shares of Common
Stock, which options are exercisable January 8, 1998. Received options
to purchase 357 shares under the Directors' Plan on January 13, 1998.
These options are not exercisable for one year from the date of grant.
(3) Includes 3,303 shares held jointly with her spouse. On January 13,
1998, Ms. Lehman received options to purchase 357 shares under the
Directors' Plan. These options are not exercisable for one year from
the date of grant. In addition, Ms. Lehman has options to purchase 162
shares of Common Stock, which options are exercisable March 6, 1997,
and 340 shares which options are exercisable January 8, 1998. The
additional 502 shares were added to the shares currently held by Ms.
Lehman and to total outstanding shares, assuming all exercisable
options were exercised.
(4) Includes 4,661 shares held jointly with his spouse, 43 shares held by
each of his two children and 2,273 shares purchased and held by the
ESOP that are allocated to Mr. Shank's account and over which he
exercises investment control. On January 13, 1998, Mr. Shank received
exercisable options to purchase 357 shares.
(5) Includes 1,150 shares held jointly with Mr. Pensinger's spouse and 109
shares held by Mr. Pensinger's spouse. On January 13, 1998, Mr.
Pensinger received options to purchase 357 shares under the Directors'
Plan. These options are not exercisable for one year from the date of
grant. In addition, Mr. Pensinger has options to purchase 162 shares of
Common Stock, which options are exercisable March 6, 1997, and 340
shares which options are exercisable January 8, 1998. The additional
502 shares were added to the shares partly held by Mr. Pensinger and to
total outstanding shares, assuming all exercisable options were
exercised.
(6) Includes 4,126 shares held by Mr. Hicks' spouse and 396 shares held in
the Hicks Chevrolet, Inc. Profit Sharing Plan. On January 13, 1998, Mr.
Hicks received options to purchase 357 shares under the Directors'
Plan. These options are not exercisable for one year from the date of
grant. In addition, Mr. Hicks has options purchase 162 shares of Common
Stock, which options are exercisable March 6, 1997, and 340 shares
which options are exercisable January 8, 1998. The additional 502
shares were added to the shares partly held by Mr. Hicks and to total
outstanding shares, assuming all exercisable options were exercised.
(7) The percent of class assumes all outstanding options issued to the
directors and officers have been exercised and, therefore, on a pro
forma basis, 883,098 shares of Common Stock outstanding.
</FN>
</TABLE>
ELECTION OF DIRECTORS
Two (2) Class B Directors are to be elected at the Annual Meeting. Each
director will serve for a three- (3) year term and until his or her successor is
elected. Unless otherwise instructed, the Proxyholders will vote the proxies
received by them for the election of the two- (2) nominees named below. If any
nominee should become unavailable for any reason, proxies will be voted in favor
of a substitute nominee as the Board of Directors of the Corporation shall
determine. The Board of Directors has no reason to believe the nominees named
will be unable to serve if elected. Any vacancy occurring on the Board of
Directors of the Corporation for any reason may be filled by a majority of the
directors then in office until the expiration of term of the vacancy.
<PAGE>
In addition, there is no cumulative voting for the election of directors.
Each share of Common Stock is entitled to cast only one vote for each nominee.
For example, if a shareholder owns ten shares of Common Stock, he or she may
cast up to ten votes for each of the two- (2) directors in the class to be
elected.
INFORMATION AS TO NOMINEES, DIRECTORS AND EXECUTIVE OFFICERS
The following table contains certain information, as of February 13, 1998,
with respect to current directors, nominees for director and certain officers of
the Corporation. <TABLE> <CAPTION>
Principal Occupation
for Past Five Years
and Position Held with the
Name Age Corporation and the Bank
- ---- --- ------------------------
<S> <C> <C>
CURRENT CLASS A DIRECTORS
TO SERVE UNTIL 2000
Harold C. Gayman 71 Dairy Farm
James H. Craig, Jr. 64 Dentist
NOMINEES FOR CLASS B DIRECTORS
TO SERVE UNTIL 2001
Betty J. Lehman 72 Retired Vice President of
the Bank
Jeff B. Shank 42 President of the Corporation
and the Bank
CLASS C DIRECTORS
TO SERVE UNTIL 1999
Robert L. Pensinger 64 Retired Insurance Agent
State Farm
Kermit G. Hicks(1) 62 Automobile Dealer-President,
Hicks Chevrolet, Inc.
Lois Easton 62 Retired Marketing Manager
of the Bank
<CAPTION>
Director Since
Name Corp/Bank
- ---- ---------
<S> <C>
CURRENT CLASS A DIRECTORS
TO SERVE UNTIL 2000
Harold C. Gayman 1983/1980
James H. Craig, Jr. 1990/1990
NOMINEES FOR CLASS B DIRECTORS
TO SERVE UNTIL 2001
Betty J. Lehman 1985/1985
Jeff B. Shank 1992/1992
CLASS C DIRECTORS
TO SERVE UNTIL 1999
Robert L. Pensinger 1987/1987
Kermit G. Hicks(1) 1983/1969
Lois Easton 1996/1996
<PAGE>
<FN>
(1) Mr. Hicks serves as a member of the Board of Directors of Accel
International Corp, a Company with a class of securities registered
pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended.
</FN>
</TABLE>
Every member of the Board of Directors is a member of each committee of the
Bank. The directors of the Corporation are also directors of the Bank. Committee
members receive no fee for attendance at Committee meetings. To date, none of
the Committees have designated a Chairman.
Asset/Liability Committee of the Bank: This Committee reviews the investment
portfolio of the Bank and the budget, and oversees implementation of budget
guidelines and expenditures. The Committee meets monthly.
Loan Committee of the Bank: This Committee reviews lines of credit and
substandard loans and makes recommendations to the Board of Directors with
respect thereto. The Committee meets monthly.
Trust Committee of the Bank: This Committee reviews all accounts and investments
held in the Bank's Trust Department. The Committee reviews Trust Department
policies and procedures and determines that the Trust Department is administered
in accordance with Federal Regulations. The Committee meets quarterly.
Executive Committee of the Bank: This Committee consists of the Chairman,
Vice-Chairman, President, Chief Executive Officer and Senior Vice President of
the Bank. This Committee meets when necessary, at the request of the Chairman,
Vice-Chairman or President of the Bank to discuss and prepare recommendations on
various business matters prior to the regular Board of Directors meeting. The
Committee met two (2) times during 1997.
Audit Committee of the Bank: This Committee reviews the annual audit and reports
submitted by the independent auditors. The Committee also reviews the
performance of internal auditing functions and reviews examination reports from
the various regulatory agencies. The Committee meets quarterly.
Trust Audit Committee: This Committee determines that the Bank's fiduciary
activities comply with policies established by the Board of Directors or the
Trust Committee. This Committee met once during 1997.
During 1997, the directors of the Corporation held 10 meetings and the
directors of the Bank held 51 meetings. Each of the directors attended at least
75 percent (75%) of the combined total number of meetings of the Boards of
Directors and of the Committees.
<PAGE>
The Corporation does not have a standing nomination or compensation
committee. A shareholder who desires to propose an individual for consideration
by the Board of Directors as a nominee for director should submit a proposal in
writing to the President of the Corporation in accordance with Section 10.1 of
the Corporation's By-Laws. Any shareholder who intends to nominate any candidate
for election to the Board of Directors must notify the Secretary of the
Corporation in writing not less than forty-five (45) days prior to the date of
any meeting of shareholders called for the election of directors.
EXECUTIVE COMPENSATION
Shown below is information concerning the annual compensation for services
in all capacities to the Corporation for the fiscal years ended December 31,
1997, 1996 and 1995 of those persons who were, as of December 31, 1997 (i) the
Chief Executive Officer, and (ii) the four (4) other most highly compensated
Executive Officers of the Corporation to the extent that such persons total
annual salary and bonus exceeded $100,000: <TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Annual Compensation
-------------------
(a) (b) (c) (d) (e)
Name Other
and Annual
Principal Salary Bonus Compen
Position Year ($) ($) -sation
-------- ---- --- --- -------
<S> <C> <C> <C> <C>
Jeff B. Shank 1997 83,400 20,000 9,800
President and 1996 81,000 20,000 9,800
Chief Executive 1995 75,000 20,000 9,800
Officer
<CAPTION>
Long-Term Compensation
----------------------
Awards Payouts
------ -------
(a) (f) (g) (h) (i)
Name Restricted All Other
and Stock Options/ Compen
Principal Awards SARs Payouts -sation
Position ($) (#)(1) ($) ($)(2)
-------- --- ------ --- ------
<S> <C> <C> <C> <C>
Jeff B. Shank -- 340 -- 21,105
President and -- 324 -- 18,890
Chief Executive -- 144(1) -- 17,357
Officer
- -------------------------
<FN>
(1) Adjusted to reflect two for one stock split paid May 15, 1996, and the 5%
stock dividend paid July 21,1997.
(2) Includes ESOP, profit sharing, and pension plan contributions. </FN>
</TABLE>
Options Grants and Fiscal Year End Values
The following table shows all grants in 1997 of stock options to the
Executive Officers named in the summary compensation table above adjusted to
reflect the Stock Dividends.
<PAGE>
<TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<CAPTION>
Individual Grants
-------------------------------------------------------
Number of % of
Securities Total
Underlying Options/SARs Exercise
Options/SARs Granted to or Base
Granted Employees In Price
Name (#)(1) Fiscal Year ($/Sh)
---- ------ ----------- ------
<S> <C> <C> <C>
Jeff B. Shank 340 100% $1/sh
President and CEO
- ---------------------
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<CAPTION>
Individual Grants
-------------------------------------------------------
Expiration Grant Date
Name Date Present Value ($)
---- ---- -----------------
<S> <C> <C>
Jeff B. Shank None $11,560
President and CEO
- ---------------------
<FN>
(1) All options were granted on January 8, 1997, and became exercisable on the
same day with no vesting schedule or expiration date.
</FN>
</TABLE>
<TABLE>
AGGREGATED OPTION/SAR EXERCISED IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<CAPTION>
Shares Acquired
Name On Exercise (#) Value Realized($)
---- --------------- -----------------
<S> <C> <C>
Jeff B. Shank 340 $13,203
President/CEO
- -------------------
AGGREGATED OPTION/SAR EXERCISED IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<CAPTION>
Value of
Number of Unexercised
Securities Underlying In-the-Money
Unexercised Options/ Option/SARs at
SARs at FY-End(#) FY End($)
Exercisable/ Exercisable/
Name Unexercisable Unexercisable
---- ------------- -------------
<S> <C> <C>
Jeff B. Shank -0-/-0- -0-/-0-
President/CEO
- -------------------
</TABLE>
Profit Sharing Plan
The Bank maintains a profit-sharing plan that generally covers all
employees who have completed one (1) year of service and attained the age of
twenty (20). Contributions to the plan are based on Bank performance as a
percentage of assets and are computed as a percentage of the participant's total
earnings. The payment of benefits to participants is made at death, disability,
termination or retirement. Contributions to the plan for all employees charged
to operations during 1997 amounted to $66,745.00.
<PAGE>
Employee Stock Option Plan
The Bank maintains an Employee Stock Option Plan that generally covers all
employees who have completed one (1) year of service and attained the age of
twenty (20). Contributions to the Plan are based on Bank performance as a
percentage of assets and are computed as a percentage of the participants' total
earnings. The payment of benefits to participants is made at death, disability,
termination or retirement. Contributions to the Plan for all employees charged
to operations during 1997 amounted to $133,490.00.
Insurance
The Bank also maintains a group health, accident, and life insurance plan
that is generally available to all employees. The aggregate amount of personal
benefits to any one person did not exceed $5,000.
The Bank maintains an executive supplemental insurance plan for certain key
executives designated by the Executive Committee of the Board. This plan
provides payments after retirement, which supplement the Bank's pension plan and
provides certain life insurance benefits. The deferred payments will be paid
from the general funds of the Bank; however, the Bank purchases and is the
beneficiary of insurance on the lives of participants, the proceeds of which are
used to help recover the net after-tax cost of the benefits and insurance
premiums paid. Premiums may also be offset by borrowing against the cash values
of the insurance policies. At December 31, 1997, these policies had a net
accumulated cash value of $878,665.00.
Compensation of Directors
During 1997, the Bank's Board of Directors held 51 meetings. Directors
receive $150 for each meeting they attend. Each director is permitted four (4)
absences each year, and will not receive the $150 meeting fee for any meeting
missed in excess of four (4) meetings per year. In addition, each director
receives a fee of $2,000 per year, payable in installments of $500 each quarter.
The Chairman of the Board receives $950 per quarter. Other than the supplemental
insurance plan described below, there are no other special arrangements with any
directors. In 1997, the Board of Directors of the Bank received $48,400.00, in
the aggregate, for all Board of Directors meetings attended and all fees paid.
<PAGE>
The Bank maintains a supplemental insurance plan for directors pursuant to
which a director may elect to defer receipt of a portion of fees for Board
Meetings for at least four (4) years or until he reaches age 65, whichever is
later. An amount equal to fees waived in addition to interest at an annual rate
of 10 percent (10%) per year will be paid to each participating director or his
designated beneficiary during a period of 10 years after the director reaches
age 65. Fees and interest paid by the Bank will be recovered through insurance
policies on the lives of participating directors. Funds from the deferred fees
of a participating director will be used to reimburse the Bank for the costs of
the premium for the insurance policies. The cost of the insurance premiums in
1997 was $31,887.
Pension Plan
The Bank maintains a non-contributory target benefit pension plan with
employer contributions being based on a pension formula, which targets a certain
monthly benefit for each plan participant at retirement. This target benefit
becomes the basis for a contribution to the plan for each eligible participant.
Once determined, these contributions are placed into an individual account for
each participant and accumulated with interest earnings each year. The ultimate
benefit payable to each employee under this pension plan is the total account
balance of the employee as of their respective retirement date. The normal
retirement date for employees is the later of the participant's sixty-fifth
birthday, or the fifth anniversary of the participant joining the Plan. An
employee must be at least twenty years of age and have one full year of service
to become a plan participant. Full vesting in accumulated plan benefits occurs
at the end of five years of service; there is no partial vesting.
For the 1997 plan year, the estimated employer contribution for all plan
participants was $36,000.00.
BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION.
The Board of Directors of the Corporation is responsible for the governance
of the Corporation and the Bank. In fulfilling its fiduciary duties, the Board
of Directors acts in the best interests of the Corporation's shareholders,
customers and the communities served by the Corporation and the Bank. To
accomplish the strategic goals and objectives of the Corporation, 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 Corporation's strategic mission. The Bank provides compensation
to the employees of the Corporation and the Bank.
The fundamental philosophy of the Corporation's and the Bank's compensation
program is to offer competitive compensation opportunities for all employees
based on the individual's contribution and personal performance. The objectives
of the compensation program are to establish a fair compensation policy to
govern executive officers' base salaries and incentive plans to attract and
motivate competent, dedicated, and ambitious managers whose efforts will enhance
the products and services of the Corporation, the results of which will be
improved profitability, increased dividends to our shareholders and subsequent
appreciation in the market value of our shares.
<PAGE>
The compensation of the Corporation's and the Bank's top executives is
reviewed and approved annually by the Board of Directors. As a guideline for
review in determining base salaries, the committee uses, among other things,
information set forth in L.R. Webbers Salary Survey. The Performance Chart uses
a different Peer Group, including only Pennsylvania bank holding companies not
quoted on the NASDAQ because of common industry issues and competition for the
same executive talent group.
Chief Executive Officer
The Board of Directors has determined that the Chief Executive Officer's
1997 compensation of $103,400 and a 2.4 percent (2.4%) increase in aggregate
Chief Executive Officer compensation over the 1996 fiscal year is appropriate.
There is no direct correlation between the Chief Executive Officer's
compensation, the Chief Executive Officer's increase in compensation and any of
the above criteria, nor is there any weight given by the Board of Directors to
any of the above specific individual criteria. Such increase in the Chief
Executive Officer's compensation is based on the committee's subjective
determination after review of all information, including the above, that it
deems relevant.
Executive Officers
The Board of Directors has established that the compensation of the
Corporation's and the Bank's executive officers increased by 3.9% over 1996
compensation of $271,700.00. Compensation increases were determined by the
committee based on its subjective analysis of the individual's contribution to
the Corporation's strategic goals and objectives. In determining whether
strategic goals have been achieved, the Board of Directors considers among
numerous factors the Corporation's performance as measured by earnings,
revenues, return on assets, return on equity, market share, total assets and
non-performing loans. Although the performance and increases in compensation
were measured in light of these factors, there is no direct correlation between
any specific criterion and the employees compensation, nor is there any specific
weight provided to any such criteria in the committee's analysis. The
determination by the committee is subjective after review of all information,
including the above, it deems relevant.
In addition to base salary, executive officers of the Corporation and the
Bank may participate currently in the Profit Sharing Plan and the Employee Stock
Option Plan.
Total compensation opportunities available to the employees of the Bank are
influenced by general labor market conditions, the specific responsibilities of
the individual, and the individual's contributions to the Corporation's success.
Individuals are reviewed annually on a calendar year basis. The Bank strives to
offer compensation that is competitive with that offered by employers of
comparable size in our industry. Through these compensation policies, the
Corporation strives to meet its strategic goals and objectives to its
constituencies and provide compensation that is fair and meaningful to its
employees.
<PAGE>
James H. Craig, Jr.
Lois Easton
Harold C. Gayman
Kermit G. Hicks
Betty J. Lehman
Robert L. Pensinger
Jeff B. Shank
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Jeff B. Shank, President and Chief Executive Officer of the Corporation, is
a member of the Board of Directors. Mr. Shank makes recommendations to the Board
of Directors regarding compensation for employees. Mr. Shank does not
participate in conducting his own review. The entire Board of Directors votes to
establish the Corporation's compensation policies.
<PAGE>
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly change in the
cumulative total shareholder return on the Corporation's Common Stock against
the cumulative total return of the S&P 500 Stock Index and the Peer Group Index
for the period of five fiscal years commencing January 1, 1993 and ended
December 31, 1997. The shareholder return shown on the graph below is not
necessarily indicative of future performance.
[Comparison of five year cumulative total return.]
[Performance Graph Omitted]
[The following is a description of the Perfomance Graph in a tabular format:]
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
Peer Group Total 900.00 1182.6 1345.91 1455.82 1634.98 2550.02
Peer Group Index 100.00 131.40 149.55 161.76 181.66 283.34
Tower Bancorp, Inc. 100.00 130.32 148.72 178.13 239.83 350.55
S&P Total Return 100.00 110.02 111.51 153.26 188.36 251.12
S&P Total Return Index 100.00 110.02 111.51 153.26 188.36 251.12
NOTE: The peer group for which information appears above includes the following
companies: ACNB Corporation; Century Financial Corporation; CNB Financial
Corporation; Drovers Bancshares Corporation; First West Chester Corporation;
Franklin Financial Services Corp.; Hanover Bancorp, Inc.; Penn Security Bank &
Trust Co.; and PennRock Financial Services Corp. These companies were selected
based on four criteria: total assets between $200 million and $700 million;
market capitalization between $15 million and $170 million; headquarters located
in Pennsylvania; and not quoted on NASDAQ.
<PAGE>
CERTAIN TRANSACTIONS
With the exceptions noted below, there have been no material transactions
between the Corporation and the Bank, nor any material transactions proposed,
with any director or executive officer of the Corporation and the Bank, or any
associate or any of the foregoing persons. The Corporation and the Bank have had
and intend to continue to have banking and financial transactions in the
ordinary course of business with directors and executive officers of the
Corporation and the Bank and their associates on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other customers. Total loans outstanding from the
Bank at December 31, 1997, to the Corporation's and Bank's officers and
directors as a group and members of their immediate families and companies in
which they had an ownership interest of 10 percent (10%) or more was
$1,748,668.00 or approximately 8.6% of total equity capital. Such loans do not
involve more than the normal risk of collectibility or present other unfavorable
features.
Change of Control Agreement
In 1995, the Corporation and the Bank entered into a Change of Control
Agreement with Jeff B. Shank, President and Chief Executive Officer of the
Corporation and the Bank (the "Agreement"). The Agreement provides certain
benefits to Mr. Shank in the event of a change of control, as more fully
described below.
In the event that the Corporation and the Bank undergo a change of control,
as defined, Mr. Shank's Agreement provides that it shall automatically become an
employment agreement, binding on any acquirer of the Corporation and the Bank.
Once triggered by a change of control, the Agreement has a three (3) year term
from the date of the change in control and provides for an automatic renewal for
an additional twelve (12) month period annually, unless terminated as provided
in the Agreement. The Agreement provides that Mr. Shank continue his duties as
President and Chief Executive Officer of the Corporation and of the Bank and
remain a member of the respective Boards of Directors. The Agreement restricts
Mr. Shank's ability to gain other employment during the term of the Agreement.
<PAGE>
The Agreement provides that, immediately following the change of control,
Mr. Shank is entitled to an annual direct salary of at least the median salary
for peer group financial institutions, as set forth in L.R. Webber Associates,
Inc. Annual Salary Survey for the calendar year immediately preceding the change
of control. In no event, shall Mr. Shank's salary, pursuant to the Agreement, be
less than his actual salary for the calendar year during which the change in
control occurred. Mr. Shank's annual direct salary after the change of control
is subject to annual review, but, in no event, may the salary be reduced below
the initial direct salary level set forth in the Agreement. The Agreement also
provides that Mr. Shank is eligible to receive periodic bonuses at the
discretion of the respective Boards of Directors of the Corporation of the Bank,
all in accordance with the bonus programs in place immediately prior to the
change in control. The Agreement also provides that Mr. Shank is entitled to
director's fees and certain fringe benefits, vacation, reimbursement of business
expenses and perquisites.
If, following a change of control, Mr. Shank is discharged or resigns for
good reason, as defined in the Agreement, he is entitled to a lump sum payment
equal to 2.99 times his base amount, as defined in the Agreement, plus certain
benefits.
PRINCIPAL OFFICERS OF THE CORPORATION
The following table sets forth selected information, as of February 13,
1998, about the principal officers of the Corporation, each of whom is elected
by the Board of Directors and each of who holds office at the discretion of the
Board of Directors. The shares beneficially owned reflect the Stock Dividends.
<TABLE>
<CAPTION>
Bank
Name And Held Employee
Office Held Since Since
- --------------------------------------------------------------------------------
<S> <C> <C>
Kermit Hicks - Chairman
of the Board 1983 (1)
Jeff B. Shank - President and Chief 1991 1976
Executive Officer
John McDowell - Executive 1986 1977
Vice President/Secretary
Don Kunkle - Vice President 1990 1987
Don Chlebowski - Treasurer 1990 1980
- ------------------------
<CAPTION>
Number Of
Shares Bene- Age as of
Name And ficially Feb. 15,
Office Held Owned 1998
- --------------------------------------------------------------------------------
<S> <C> <C>
Kermit Hicks - Chairman
of the Board 14,866 62
Jeff B. Shank - President and Chief 7,020 42
Executive Officer
John McDowell - Executive 3,028 48
Vice President/Secretary
Don Kunkle - Vice President 5,540 48
Don Chlebowski - Treasurer 1,222 39
- ------------------------
<FN>
(1) Mr. Hicks is not an employee of the Bank.
</FN>
</TABLE>
Each of the principal officers of the Corporation has been employed as an
officer or employee of the Bank for more than the past five- (5) years.
PROPOSAL TO AMEND AND RESTATE ARTICLE 5a
OF THE CORPORATION'S ARTICLES OF INCORPORATION
On December 10, 1997, the Board of Directors unanimously approved and
adopted resolutions to amend and restate Article 5a of the Corporation's
Articles of Incorporation to eliminate par value for the Corporation's Common
Stock and Preferred Stock. A true and correct copy of the proposed Article 5a of
the Corporation's Articles of Incorporation and the resolutions approved and
adopted by the Board of Directors and the proposal to the shareholders are set
forth below:
WHEREAS, the Pennsylvania Business Corporation Law of 1988, as amended (the
"BCL") does not require a corporation's stock to have a "Par Value".
WHEREAS, the Board of Directors of the Corporation believes that the
designation of a Par Value for its securities merely creates additional
cumbersome paperwork for ordinary transactions, such as stock splits and stock
dividends;
WHEREAS, the Board of Directors of the Corporation believes that the
elimination of Par Value for the Corporation's securities is desirable in order
to eliminate the unnecessary and cumbersome feature; and
WHEREAS, the Board of Directors of the Corporation believes that it is in
the best interests of the Corporation and its shareholders to amend the
Corporation's Articles of Incorporation to eliminate par value for the
Corporation's common stock and preferred stock in order to provide the
Corporation with as much flexibility and convenience as possible to issue
additional shares of stock for proper corporate purposes, including stock
splits, stock dividends and other similar purposes.
NOW, THEREFORE, BE IT:
RESOLVED, that, in accordance with Sections 1911, 1912, 1914, 1915 and
1916 of the BCL, the Board of Directors hereby approves and adopts the
following amendment to Article 5a of the Corporation's Articles of
Incorporation, as amended (the "Amendment") and the proper officers of the
Corporation be and they are hereby authorized, empowered and directed to
submit the Amendment to the shareholders of the Corporation for their
approval and adoption at the 1998 Annual Meeting of Shareholders to be held
on April 1, 1998 (the "Annual Meeting"):
Article 5a of the Articles of Incorporation, as amended, of Tower Bancorp,
Inc. is amended and restated to read in full and in its entirety as
follows:
5a. The aggregate number of shares that the Corporation shall have
authority to issue is 5,000,000 shares of Common Stock (the "Common Stock")
and 500,000 shares of preferred stock (the "Preferred Stock").
RESOLVED, that, as soon as practicable after approval and adoption of
the Amendment by the shareholders of the Corporation at the Annual Meeting,
the proper officers of the Corporation, are hereby authorized, empowered
and directed, for and on behalf of the Corporation, to execute, deliver and
file Articles of Amendment, containing the Amendment with the Commonwealth
of Pennsylvania, Department of State, Corporation Bureau, and upon such
filing the Amendment shall be effective;
RESOLVED, that the proper officers of the Corporation be and they are
hereby authorized, empowered and directed to execute, seal, attest,
acknowledge and deliver such documents, applications and other instruments,
in the name and on behalf of the Corporation, and each and every resolution
required to be adopted by any legislation or law, or by any order or
regulation of any legislation or law, or by any order or regulation of any
governmental body or agency, in any state or jurisdiction, and the same
hereby is adopted, approved, and confirmed, and that all action heretofore
taken by the officers of the Corporation with respect to amending the
Corporation" Articles of Incorporation be and the same hereby is ratified,
approved, and confirmed; and
RESOLVED, that the proper officers of the Corporation be and they are
hereby authorized, empowered, directed and ordered, in the name of and on
behalf of the Corporation, to take any and all actions and to execute any
and all documents as may be necessary, appropriate and desirable, in their
discretion, to carry out the intent and the purpose of the foregoing
resolutions.
The Board of Directors believes that it is in the best interests of the
Corporation to eliminate the archaic designation of par value with respect to
the Corporation's stock. The enactment of the General Association Act of 1988,
by the Pennsylvania Legislature was the culmination of a nearly 50 years by the
Pennsylvania Bar Association to "to create and maintain, the Pennsylvania
Corporation Laws as short, definite, clear and fair as possible to shareholders,
management and credit of corporations alike, and to constitute them the finest
legislation on the subject in the country." Without question, the most urgently
needed change was the elimination of the requirement that a dual set of books be
kept; one under current accounting practices, as required by tax and regulatory
authorities, and the other to comply with the 1957-period accounting concepts
"frozen" into the statutory language of the 1993 Business Corporation Law. For
example, under the modern equity method of accounting, earnings of a subsidiary
in which a parent corporation has a significant investment automatically appear
in the retained earnings of the parent, but for purposes of the antiquated
Pennsylvania Business Corporation Law either an actual dividend had to be
declared or complex capital surplus tests had to be met and even this later
option was not available if the subsidiary was a Canadian or other non-US
corporation.
The revisions to the financial provisions of the law reflected a complete
modernization of all the provisions relating to financial matters including the
(i) the elimination of the outmoded concepts of stated capital and par value,
(ii) the definition of "distribution" as a broad term governing dividends, share
repurchases and similar actions that should be governed by the same standard,
(iii) the reformulation of the statutory standards governing the making of
distributions, (iv) the elimination of references to Treasury stock, and (v) the
making of a number of technical and conforming changes that the Pennsylvania
legislature found necessary or advisable in connection with the basic revisions.
Practitioners and legal scholars had long recognized that the pervasive
statutory structure in which "par value" and "stated capital" are basic to State
corporation statutes, did not serve the original purpose of protecting creditors
and senior security holders from payments to junior security holders, and might,
to the extent security holders were led to believe it provides some protection,
tend to be misleading.
The elimination of par value will give the Board of directors more latitude
in regulating the affairs of the Corporation. It will not effect a shareholders
equity in the corporation nor will it change the rights and privileges of the
Common Stock or of Preferred Stock that the Board of Directors has the authority
to issue. Elimination of par value will permit the Board of Directors to, among
other things, declare stock splits without amending the Corporation's Articles
of Incorporation to reflect a change in the par value of the shares. The test
for legality of a dividend, now termed a distribution, is the same whether a
Corporation continues to have shares with a par value or not.
The Board of directors proposes that Article 5A of the Corporation's
Articles of Incorporation be amended to read in full and in its entirety as set
forth above and that the shareholders of the Corporation approve and adopt the
following resolution:
RESOLVED, that the proposed amendment to Article 5a of the Articles of
Incorporation of the Corporation, as set forth in its entirety above, be
and hereby is, approved, adopted, ratified and confirmed.
The affirmative vote of a majority of all votes cast by all shareholders
entitled to vote thereon is required to approve and adopt this amendment to
Article 5a of the Articles of Incorporation of the Corporation. Proxies
solicited by the Board of Directors will be voted for the foregoing resolution
unless shareholders specify to the contrary on their proxies.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE PROPOSAL
TO AMEND THE COPORATION'S ARTICLES OF INCORPORATION TO ELIMINATE NO PAR
VALUE WITH RESPECT TO THE CORPORATION'S SHARES.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Corporation's officers and directors, and persons who own more than
ten percent (10%) of the registered class of the Corporation's equity
securities, to file reports of ownership and changes in ownership with the
Securities and Exchange Commission ("SEC"). Officers, directors, and greater
than ten percent (10%) shareholders are required by SEC regulation to furnish
the Corporation with copies of all Section 16(a) forms they file.
<PAGE>
Based solely on its review of the copies of such forms received by it, or
written representations from reporting persons that no Forms 5 were required for
those persons, the Corporation believes that during the period January 1, 1997
through December 31, 1997, its officers and directors were in compliance with
all filing requirements applicable to them.
LEGAL PROCEEDINGS
In the opinion of the management of the Corporation, there are no
proceedings pending to which the Corporation and the Bank are a party or to
which its property is subject, which, if determined adversely to the Corporation
and the Bank, would be material in relation to the Corporation's and the Bank's
financial condition. There are no proceedings pending other than ordinary
routine litigation incident to the business of the Corporation and the Bank. In
addition, no material proceedings are pending or are known to be threatened or
contemplated against the Corporation and the Bank by government authorities.
RATIFICATION OF INDEPENDENT PUBLIC AUDITORS
Unless instructed to the contrary, it is intended that votes will be cast
pursuant to the proxies for the ratification of the selection of Smith Elliott
Kearns & Company, LLC as the Corporation's independent auditors for its 1998
fiscal year. The Corporation has been advised by Smith Elliott Kearns & Company,
LLC that none of its members has any financial interest in the Corporation.
Ratification of Smith Elliott Kearns & Company, LLC will require the affirmative
vote of a majority of the shares of Common Stock represented in person or by
proxy at the Annual Meeting. Smith Elliott Kearns & Company, LLC served as the
Corporation's independent public accountants for the 1997 fiscal year. In
addition to performing customary audit services, Smith Elliott Kearns & Company,
LLC assisted the Corporation and the Bank with the preparation of their federal
and state tax returns, and provided assistance in connection with regulatory
matters, charging the Corporation for such services at its customary hourly
billing rates. These non-audit services were approved by the Board of Directors
prior to the rendering of such services after due consideration of the effect of
the performance thereof on the independence of the accountants. These services
were approved by the Corporation's Board of Directors and the Board of Directors
reviewed the nature and expense associated with such services and concluded that
there was no effect on the independence of the accountants.
In the event that the shareholders do not ratify the selection of Smith
Elliott Kearns & Company, LLC as the Corporation's independent auditors for the
1998 fiscal year, another accounting firm may be chosen to provide independent
audit services for the 1998 fiscal year. The Board of Directors recommends that
the shareholders vote FOR the ratification of the selection of Smith Elliott
Kearns & Company, LLC as the independent auditors for the Corporation for the
year ending December 31, 1998.
<PAGE>
ANNUAL REPORT
A copy of the Corporation's Annual Report for its fiscal year ended
December 31, 1997 is enclosed with this proxy statement. A representative of
Smith Elliott Kearns & Company, LLC, the accounting firm that examined the
financial statements in the annual report, will attend the annual meeting. This
representative of Smith Elliott Kearns & Company, LLC will have the opportunity
to make a statement, if he desires to do so, and will be available to respond to
any appropriate questions presented by shareholders at the Annual Meeting.
SHAREHOLDER PROPOSALS
Any shareholder who, in accordance with and subject to the provisions of
the proxy rules of the Securities and Exchange Commission, wishes to submit a
proposal for inclusion in the Corporation's proxy statement for its 1999 Annual
Meeting of Shareholders must deliver such proposal in writing to the president
of Tower Bancorp, Inc. principal executive offices at Center Square,
Greencastle, Pennsylvania, not later than Tuesday, November 3, 1998.
OTHER MATTERS
The Board of Directors does not know of any matters to be presented for
consideration other than the matters described in the accompanying Notice of
Annual Meeting of Shareholders, but if any matters are properly presented, it is
the intention of the persons named in the accompanying proxy to vote on such
matters in accordance with their best judgment.
ADDITIONAL INFORMATION
Upon written request of any shareholder, a copy of the Corporation's
report on form 10-K for the fiscal year ended December 31, 1997, including the
financial statements and the schedules thereto, required to be filed with the
SEC pursuant to rule 13a-1 under the Securities Exchange Act of 1934, as
amended, may be obtained, without charge, from Jeff B. Shank, President, Tower
Bancorp, Inc., P.O. Box 8, Center Square, Greencastle, Pennsylvania 17225.
<PAGE>
[X] PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE TOWER BANCORP, INC.
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 1, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby constitutes and appoints Darlene Niswander and C.
Ordean Monn and each or any of them, proxies of the undersigned, with full
power of substitution, to vote all of the shares of Tower Bancorp, Inc. (the
"Corporation") that the undersigned may be entitled to vote at the Annual
Meeting of Shareholders of the Corporation to be held at the Rescue Hose
Company Special Events Center, 407 South Washington Street, Greencastle,
Pennsylvania 17225, on Wednesday, April 1, 1998 at 1:30 p.m., prevailing time,
and at any adjournment or postponement thereof as follows:
With- For All
For hold Except
1. ELECTION OF 2 CLASS B [ ] [ ] [ ]
DIRECTORS TO SERVE A
THREE-YEAR TERM (Except
as marked to the
contrary below):
Betty J. Lehman and Jeff B. Shank
INSTRUCTION: To withhold authority to vote for any individual nominee, mark
"For All Except" and write that nominee's name in the space provided below.
- -----------------------------------------------------------------------
For Against Abstain
2. PROPOSAL TO CONSIDER AND [ ] [ ] [ ]
ACT UPON AMENDMENT OF
ARTICLE 5(a) OF THE CORPORATION'S ARTICLES OF INCORPORATION TO
ELIMINATE PAR VALUE FOR THE CORPORATION'S STOCK.
For Against Abstain
3. PROPOSAL TO RATIFY THE [ ] [ ] [ ]
SELECTION OF SMITH ELLIOT
KEARNS & COMPANY, LLC, CERTIFIED PUBLIC ACCOUNTANTS, AS THE
INDEPENDENT AUDITORS FOR THE CORPORATION FOR THE FISCAL YEAR
ENDING DECEMBER 31, 1998.
4. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting and any adjournment
thereof.
THIS PROXY, WHEN PROPERLY SIGNED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE AFORESIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR ALL NOMINEES LISTED ABOVE AND FOR PROPOSALS 2 AND 3.
Date
Please be sure to sign and date this proxy in the box below._______________
[ ]
[ ]
[_______Shareholder sign above _______Co-holder (if any) sign above________]
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Detach above card, sign, date and mail in postage paid envelope provided.
TOWER BANCORP, INC.
- ------------------------------------------------------------------------------
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.
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
