<PAGE>
<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Subsection 240.14a-11(c) or
Subsection 240.14a-12
[ ] Confidential, For Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
COMMERCIAL FEDERAL CORPORATION
- ----------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- ----------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(1) 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:
_________________________________________________________________
4. Proposed maximum aggregate value of transaction:
_________________________________________________________________
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or Schedule
and the date of its filing.
1. Amount Previously Paid:
____________________________________________
2. Form, Schedule or Registration Statement No.:
____________________________________________
3. Filing Party:
____________________________________________
4. Date Filed:
____________________________________________<PAGE>
<PAGE>
[COMMERCIAL FEDERAL CORPORATION LETTERHEAD]
October 17, 1997
ANNUAL MEETING
NOVEMBER 18, 1997
Dear Fellow Stockholder:
You are cordially invited to attend the Annual Meeting of
Stockholders of Commercial Federal Corporation (the
"Corporation") to be held on Tuesday, November 18, 1997, at 10:00
a.m. at the Holiday Inn Central Convention Centre, "Holiday C"
Meeting Room, 3321 South 72nd Street, Omaha, Nebraska. Your
Board of Directors and Management look forward to greeting
personally those stockholders able to attend.
At this meeting, as set forth in the accompanying Notice of
Annual Meeting and Proxy Statement, stockholders will be asked to
consider and act upon (i) the election of one director for a
two-year term and three directors for three-year terms, (ii) a
proposal to amend the Corporation's Articles of Incorporation to
increase the number of authorized shares of common stock and
(iii) a proposal to amend the Corporation's Articles of
Incorporation to establish a variable range for the number of
members on the Board of Directors. During the meeting, we will
also report on the operations of the Corporation and its
principal subsidiary, Commercial Federal Bank, a Federal Savings
Bank. Directors and officers of the Corporation will be present
to respond to any questions you may have.
Your vote is important, regardless of the number of shares
you own. We urge you to sign, date and mail the enclosed proxy
as soon as possible, even if you currently plan to attend the
annual meeting. This will not prevent you from voting in person,
but will assure that your vote is counted if you are unable to
attend the meeting.
On behalf of your Board of Directors, thank you for your
continued support.
Sincerely,
/s/ William A. Fitzgerald /s/ James A. Laphen
William A. Fitzgerald James A. Laphen
Chairman of the Board and President and Chief
Chief Executive Officer Operating Officer
<PAGE>
<PAGE>
COMMERCIAL FEDERAL CORPORATION
2120 SOUTH 72ND STREET
OMAHA, NEBRASKA 68124
(402) 554-9200
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 18, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of
Stockholders (the "Meeting") of Commercial Federal Corporation
(the "Corporation") will be held at the Holiday Inn Central
Convention Centre, "Holiday C" Meeting Room, 3321 South 72nd
Street, Omaha, Nebraska, on Tuesday, November 18, 1997, at 10:00
a.m.
A Proxy Card and a Proxy Statement for the Meeting are
enclosed.
The Meeting is for the purpose of considering and acting
upon:
1. The election of one director of the Corporation for a
two-year term and three directors for three-year terms;
2. An amendment to the Corporation's Articles of
Incorporation to increase the number of authorized shares of
common stock from 25,000,000 shares to 50,000,000 shares;
3. An amendment to the Corporation's Articles of
Incorporation to establish a variable range for the number of
members on the Board of Directors from nine to 12 members; and
4. Such other matters as may properly come before the
Meeting or any adjournments or postponements thereof.
NOTE: The Board of Directors is not aware of any other
business to come before the Meeting.
Any action may be taken on the foregoing matters at the
Meeting on the date specified above or on any date or dates to
which, by original or later adjournment or postponement, the
Meeting may be adjourned or postponed. Pursuant to the Bylaws of
the Corporation, the Board of Directors has fixed the close of
business on October 6, 1997, as the record date for determination
of the stockholders entitled to notice of and to vote at the
Meeting and any adjournments or postponements thereof.
You are requested to sign and date the enclosed form of
proxy which is solicited by the Board of Directors and to mail it
promptly in the enclosed postage-paid envelope. The proxy will
not be used if you attend and vote at the Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Gary L. Matter
GARY L. MATTER
SECRETARY
Omaha, Nebraska
October 17, 1997
<PAGE>
<PAGE>
PROXY STATEMENT
OF
COMMERCIAL FEDERAL CORPORATION
2120 SOUTH 72ND STREET
OMAHA, NEBRASKA 68124
(402) 554-9200
ANNUAL MEETING OF STOCKHOLDERS
November 18, 1997
_________________________________________________________________
GENERAL
_________________________________________________________________
This Proxy Statement and the enclosed Proxy Card are
furnished in connection with the solicitation of proxies
by the Board of Directors of Commercial Federal Corporation (the
"Corporation"), to be used at the Annual Meeting of Stockholders
of the Corporation and at any adjournments or postponements
thereof (the "Meeting") which will be held at the Holiday Inn
Central Convention Centre, "Holiday C" Meeting Room, 3321 South
72nd Street, Omaha, Nebraska, on Tuesday, November 18, 1997, at
10:00 a.m. The accompanying Notice of Annual Meeting, this Proxy
Statement and the Proxy Card are being first mailed to
stockholders on or about October 17, 1997.
_________________________________________________________________
VOTING AND REVOCABILITY OF PROXIES
_________________________________________________________________
The close of business on October 6, 1997, has been fixed as
the record date for the determination of stockholders entitled to
notice of and to vote at the Meeting. At that date, the
Corporation had outstanding 21,584,303 shares of common stock,
par value $.01 per share (the "Common Stock"). Holders of Common
Stock are entitled to one vote per share for the election of
directors, subject to the right to cumulate votes as described
below, and upon all matters on which stockholders are entitled to
vote.
Proxies solicited by the Board of Directors of the
Corporation which are properly executed and returned to the
Corporation will be voted at the Meeting, and any adjournments or
postponements thereof, in accordance with the directions given
thereon. Executed proxies on which no directions are indicated
will be voted FOR Proposals I, II and III. If any other matters
are properly brought before the Meeting, the proxies solicited by
the Board of Directors will be voted on such matters as
determined by a majority of the Board. Other than the election
of directors, the proposal to amend the Corporation's Articles of
Incorporation to increase the number of authorized shares of
Common Stock and the proposal to amend the Corporation's Articles
of Incorporation to establish a variable range for the number of
members on the Board of Directors, the Board of Directors is not
currently aware of any other matters to be brought
before the Meeting.
The presence in person or by proxy of the holders of a
majority of the outstanding shares of Common Stock entitled to
vote at the Meeting is necessary to constitute a quorum thereat.
If a quorum is not present or represented by proxy, the
stockholders entitled to vote, present or represented by proxy,
have the power to adjourn the Meeting from time to time, without
notice other than an announcement at the Meeting, until a quorum
is present or represented. Assuming a quorum is present, under
Nebraska law directors shall be elected by a plurality of votes
cast by stockholders at the Meeting (abstention and broker
non-votes not being considered in determining the outcome of the
election). All other action to be taken at the Meeting requires
the affirmative vote of a majority of the shares represented and
entitled to vote at the Meeting (accordingly, abstentions and
broker non-votes will not affect the outcome of any such action).
<PAGE>
<PAGE>
Pursuant to the Bylaws of the Corporation and Nebraska law,
every stockholder entitled to vote for the election of directors
has the right to vote the number of shares owned thereby for as
many persons as there are directors to be elected, or to cumulate
votes by multiplying the number of shares held by such
stockholder by the number of directors to be elected and to cast
such votes for one director or distribute them among any number
of candidates. Unless otherwise indicated by the stockholder, a
vote FOR the Board of Directors' nominees on the accompanying
Proxy Card will give the proxies named therein discretionary
authority to cumulate all votes to which the stockholder is
entitled and to allocate such votes in favor of one or more of
the Board's nominees, as the proxies may determine.
Additionally, executed proxies will confer discretionary
authority on the proxies named therein to vote with respect to
the election of any person recommended by the Board of Directors
as a director where the nominee is unable to serve or for good
cause will not serve (an event not now anticipated).
Execution of a Proxy Card will not affect your right to
attend the Meeting and to vote in person. A stockholder
executing a proxy may revoke such proxy at any time before it is
voted by (i) filing a written notice of revocation with
the Secretary of the Corporation at the address provided above,
(ii) filing a duly executed proxy bearing a later date,
or (iii) attending and voting in person at the Meeting.
Attendance at the Meeting without voting thereat will not revoke
a proxy previously executed and duly submitted by you.
_________________________________________________________________
PRINCIPAL STOCKHOLDERS
_________________________________________________________________
Persons and groups owning in excess of 5.0% of the Common
Stock are required to file certain reports regarding such
ownership pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). Based upon such reports, and
certain other available information, the following table sets
forth, as of October 6, 1997, certain information as to the
Common Stock beneficially owned (i) by stockholders owning in
excess of 5.0% of the Corporation's outstanding shares of Common
Stock, (ii) by each of the executive officers listed in the
Summary Compensation Table on page 10, and (iii) by all executive
officers and directors of the Corporation as a group.
<TABLE>
<CAPTION>
Amount and Percent of
Nature of Shares of
Beneficial Common Stock
Beneficial Owner Ownership (1) Outstanding
- ---------------- ------------- ------------
<S> <C> <C>
John Hancock Advisers, Inc. 1,297,200 6.01%
101 Huntington Avenue
Boston, MA 02199
William A. Fitzgerald 464,707 (2) 2.13%
James A. Laphen 157,235 (2) .73%
Gary L. Matter 40,173 (2) .19%
Joy J. Narzisi 33,259 (2) .15%
Jon W. Stephenson 15,622 (2) .07%
All Executive Officers and Directors
as a Group (32 persons) 1,471,729 (2) 6.65%
<FN>
______________
(1) As to ownership of shares by executive officers and directors, includes
certain shares of Common Stock owned by businesses in which the director
or executive officer is an officer or major stockholder, or by spouses or
as a custodian or trustee for minor children, over which shares the named
individual or all executive officers and directors as a group effectively
exercise sole or shared voting and investment power, unless otherwise
indicated.
(2) Includes 332,176, 82,219, 18,764, 25,196, 12,640 and 751,726 shares,
respectively, which Messrs. Fitzgerald, Laphen, Matter, Ms. Narzisi and
Mr. Stephenson and all executive officers and directors as a group have
the right to purchase pursuant to the exercise of stock options, as well
as stock held in retirement accounts or funds for the benefit of the named
individuals or group.
</FN>
/TABLE
<PAGE>
<PAGE>
________________________________________________________________
PROPOSAL I -- ELECTION OF DIRECTORS
________________________________________________________________
The Corporation's Board of Directors is composed of nine
members. The Corporation's Articles of Incorporation provide
that directors are to be elected for terms of three years,
one-third of whom are to be elected annually. One director will
be elected at the Meeting to serve for a two-year period or
until his successor has been elected and qualified. The Board
of Directors has nominated Michael P. Glinsky for this seat.
Mr. Glinsky was appointed a director in September 1997 to fill
the vacancy created by the resignation of Charles M. Lillis.
In addition, three directors will be elected at the Meeting to
serve three-year terms, or until their respective successors
have been elected and qualified. The Corporation's Board of
Directors has nominated Talton K. Anderson, Carl G. Mammel and
James P. O'Donnell for these seats, all of whom are currently
members of the Board.
If any nominee is unable to serve, the shares represented by
all valid proxies will be voted for the election of such
substitute as the Board of Directors may recommend. At this
time, the Board knows of no reason why any nominee might be
unavailable to serve.
The Board of Directors intends to vote all of the shares for
which it is given proxies, to the extent permitted thereunder,
FOR the election of the Board's nominees and intends to cumulate
votes so as to maximize the number of such nominees elected to
serve as directors of the Corporation.
The following table sets forth the names of the Board's
nominees for election as directors and of those directors
who will continue to serve as such after the Meeting. Also set
forth is certain other information with respect to each
person's age, the year he became a director, the expiration of
his term as a director, and the number and percentage of
shares of Common Stock beneficially owned at October 6, 1997.
At present, each director of the Corporation is also
a member of the Board of Directors of the Corporation's wholly
owned subsidiary, Commercial Federal Bank, a Federal
Savings Bank (the "Bank"). The Board of Directors of the Bank
is elected by the Corporation as the sole stockholder
of the Bank. The selection of nominees for the election of
directors of the Bank is within the discretion of the Board
of Directors and director nominees for the Bank are selected by
a majority vote of the Board of Directors.
3<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
YEAR FIRST BENEFICIALLY
AGE AT ELECTED OR CURRENT OWNED AT
OCTOBER 6, APPOINTED TERM OCTOBER 6, PERCENT
NAME 1997 DIRECTOR TO EXPIRE 1997 OF CLASS
---- ---------- -------- --------- ------------ --------
BOARD NOMINEES FOR TERMS TO EXPIRE IN 1999
<S> <C> <C> <C> <C> <C>
Michael P. Glinksy 52 1997 (2) 1997 (2) -- --%
BOARD NOMINEES FOR TERMS TO EXPIRE IN 2000
Talton K. Anderson 60 1991 1997 33,203 (3) .15%
Carl G. Mammel 64 1991 1997 81,953 (3) .38%
James P. O'Donnell 49 1991 1997 8,043 (3) .04%
DIRECTORS CONTINUING IN OFFICE
William A. Fitzgerald 59 1984 1998 464,707 (4) 2.13%
Robert D. Taylor 50 1996 1998 54,707 (3) .25%
Aldo J. Tesi 46 1996 1998 3,274 (3) .02%
Robert F. Krohn 64 1984 1999 131,786 (3) .61%
Robert S. Milligan 52 1987 1999 11,772 (3) .05%
<FN>
____________
(1) Includes certain shares of Common Stock owned by businesses in which the
director is an officer or major stockholder or by a spouse, or as a custodian
or trustee for minor children, over which shares the named individual
effectively exercises sole or shared voting and investment power, unless
otherwise indicated. Also includes shares held in retirement accounts
or funds for the benefit of the named individuals.
(2) Mr. Glinsky was appointed in September 1997 to fill the vacancy created by the
resignation of Charles M. Lillis. Under Nebraska law, directors appointed to
fill a vacancy are required to stand for election at the next annual meeting
of stockholders.
(3) Includes 3,000 shares which may be purchased pursuant to the exercise of stock
options.
(4) Includes 218,351 shares which may be purchased pursuant to the exercise of stock
options.
</FN>
</TABLE>
The principal occupation of each director of the Corporation
for the last five years is set forth below.
MICHAEL P. GLINSKY -- Executive Vice President and Chief
Financial Officer of U S WEST, Inc., an international
telecommunications, entertainment and directory and information
services company. Prior to assuming his current position, Mr.
Glinsky served as managing partner of the Denver office of
Coopers & Lybrand from 1990 to 1996 and had served in various
other capacities with that firm since 1967.
TALTON K. ANDERSON -- Owner and President of three
automobile dealerships in Omaha, Nebraska, as well as one in
Lincoln, Nebraska. Mr. Anderson is also the President of a
Nebraska-based automobile leasing company and a reinsurance
company.
CARL G. MAMMEL -- Chairman of the Board of Mammel &
Associates, a consulting firm providing services in executive
benefits, employee benefits planning and wealth transfer
planning. Mr. Mammel is also Chairman of the Board of M
Financial Corporation, a network of financial service firms
throughout the United States.
JAMES P. O'DONNELL -- Executive Vice President, Chief
Financial Officer and Corporate Secretary of ConAgra, Inc., an
Omaha, Nebraska-based international diversified food company
with annual sales of approximately $24 billion.
4<PAGE>
<PAGE>
WILLIAM A. FITZGERALD -- Chairman of the Board and Chief
Executive Officer of the Corporation and the Bank.
ROBERT D. TAYLOR -- Owner and President of Taylor
Financial, based in Wichita, Kansas, a consulting and
investment firm. From December 31, 1990, to October 2, 1995,
Mr. Taylor served as Chairman of the Board of Directors and
Chief Executive Officer of Railroad Financial Corporation and
its wholly owned subsidiary, Railroad Savings Bank, F.S.B.
Railroad Financial Corporation was acquired by the Corporation
effective October 2, 1995.
ALDO J. TESI -- President of First Data Card Enterprise
Group since 1996. Prior to this position, Mr. Tesi was
President of First Data Resources for six years. First Data is
the leading third-party provider of credit, debit, private
label and commercial card processing services.
ROBERT F. KROHN -- Vice Chairman and Chief Executive
Officer of PSI Group, Inc., a national mail presort
company. Mr. Krohn is the former President and Chief Executive
Officer of HDR, Inc., an international architecture,
planning and engineering firm. Mr. Krohn served as Chairman of
the Board of the Corporation and the Bank from 1990
through 1994.
ROBERT S. MILLIGAN -- Chairman of the Board and Chief
Executive Officer of MI Industries, a protein
processing company headquartered in Lincoln, Nebraska, which
produces products for pharmaceutical, biological and
research markets throughout the world.
________________________________________________________________
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
________________________________________________________________
The Board of Directors conducts its business through
meetings of the Board and through its committees, which
permits the Board to more efficiently discharge its duties.
During the fiscal year ended June 30, 1997, the Board of
Directors held eight meetings. With the exception of Director
Tesi, no director attended fewer than 75% of the total
meetings of the Board of Directors and committees on which such
directors were members during the periods which such directors
served. Directors Taylor and Tesi were only eligible to attend
four of the eight meetings as they did not become directors
until November 1996. Director Tesi attended two of the four
meetings he was eligible to attend during fiscal year 1997 and
Director Taylor attended all four of such meetings.
The Corporation's audit committee is currently comprised
entirely of non-employee Directors Anderson (Chairman), Krohn
and Tesi. Michael T. O'Neil and Sharon G. Marvin, directors of
the Bank, also serve as ex-officio members of the audit
committee. This committee's function is to approve the outside
accounting firm for use by the Corporation and Bank and to
review regulatory examination reports. This committee conducts
its business through the Bank's audit committee and serves as
the liaison with the Bank's internal audit department. The
audit committee meets quarterly or on an as needed basis.
During the fiscal year ended June 30, 1997, the audit committee
met five times.
The Corporation's compensation and stock option committee is
currently comprised entirely of non-employee Directors Anderson,
Mammel (Chairman) and O'Donnell. This committee is responsible
for developing the Corporation's executive compensation policies
generally, and for implementing those policies for the
Corporation's executive officers and the Bank's senior executive
officers (the Chairman of the Board and Chief Executive Officer
of the Corporation and the Bank and the President and Chief
Operating Officer of the Corporation and the Bank). See
"Executive Compensation -- Compensation and Stock Option
Committee Report on Executive Compensation." The compensation
committee met twice during the fiscal year ended June 30, 1997.
<PAGE>
The Corporation's full Board of Directors currently acts as
a nominating committee for the annual selection of its nominees
for election as directors. While the Board of Directors will
consider nominees recommended by stockholders, it has not
actively solicited recommendations from the Corporation's
stockholders for nominees nor, subject to the procedural
requirements set forth in the Corporation's Articles of
Incorporation and Bylaws, are there any
5<PAGE>
<PAGE>
formal procedures for this purpose. The Board of Directors held
one meeting in its capacity as nominating committee during
fiscal year 1997.
The Corporation's finance committee is currently comprised
of Directors Fitzgerald, Mammel, Milligan, O'Donnell (Chairman)
and Taylor and met four times during the 1997 fiscal year. This
committee is responsible for monitoring the Corporation's
asset/liability and risk management strategies.
The Corporation's executive committee is comprised of
Directors Anderson, Fitzgerald (Chairman), Krohn and
O'Donnell. This committee transacts necessary business between
Board meetings and met five times during the fiscal
year ended June 30, 1997.
________________________________________________________________
EXECUTIVE COMPENSATION
________________________________________________________________
COMPENSATION AND STOCK OPTION COMMITTEE REPORT ON EXECUTIVE
COMPENSATION
Overview and Objectives
Composed exclusively of outside directors, Talton K.
Anderson, Carl G. Mammel (Chairman) and James P. O'Donnell, the
Compensation and Stock Option Committee (the "Committee") of the
Board of Directors establishes the Corporation's and the Bank's
executive compensation policies. The Committee is responsible
for developing the Corporation's and the Bank's executive
compensation policies generally, and for implementing those
policies for the Corporation's executive officers and the Bank's
senior executive officers (the Chairman of the Board and Chief
Executive Officer of the Corporation and the Bank and the
President and Chief Operating Officer of the Corporation
and the Bank). The Chief Executive Officer of the Bank, under
the direction and pursuant to the policies of the Committee,
implements the executive compensation policies for the remainder
of the Bank's executive officers. The Corporation established
structured compensation guidelines recommended by an outside
professional consulting firm in fiscal year 1994. These
guidelines were used in fiscal year 1997 and updated using
professional surveys from the financial services industry. The
results of the study and applicable updates indicated that the
Corporation's existing compensation programs were within
reasonable and appropriate guidelines.
The Committee's overall objectives in designing and
administering the specific elements of the Corporation's
and the Bank's executive compensation program are as follows:
. to align executive compensation to increases in
shareholder value, as measured by favorable long-term
operating results and continued strengthening of the
Corporation's financial condition;
. to provide incentives for executive officers to work
towards achieving successful annual results as a step in
fulfilling the Corporation's long-term operating results
and strategic objectives;
. to link, as closely as possible, executive officers'
receipt of incentive awards with the attainment of
specified performance objectives;
. to maintain a competitive mix of total executive
compensation with particular emphasis on awards directly
related to increases in long-term shareholder value; and
. to attract, retain and motivate top performing executive
officers in a cost effective manner for the long-term
success of the Corporation.
In furtherance of these objectives, the Corporation's
executive compensation program for fiscal year 1997 consisted of
the following components.
6<PAGE>
<PAGE>
. BASE SALARY. The Committee makes recommendations to the
Board concerning executive compensation on the basis of regional
and national surveys of salaries paid to executive officers of
other savings and loan holding companies, non-diversified banks
and other financial institutions similar to the Corporation in
size, market capitalization and other characteristics. The
Committee's objective is to provide base salaries that are
reasonably competitive with the average salary paid by the
Corporation's peers as identified in such surveys.
. EXECUTIVE INCENTIVE PLAN. The Corporation maintains an
Executive Incentive Plan which provides for annual incentive
compensation based on achieving a combination of Corporation and
individual performance objectives. Under this plan, the
Committee establishes challenging corporate objectives, such as
a targeted level of annual net income, at the beginning of the
fiscal year. If the Corporation meets such objectives, an
amount equal to 4.5% of net income is set aside for payment to
executive officers (defined for this purpose as the Bank's Chief
Executive and Chief Operating Officers, Senior and First Vice
Presidents and such other officers as are designated by the
Committee for any fiscal year) as short-term and long-term
compensation. If the Corporation meets less than a designated
percentage (85% for fiscal year 1997) of the performance
objectives established for a fiscal year, no funds are made
available for awards under this plan for such fiscal year. If
the Corporation meets between designated percentages (between
85% and 100% for fiscal year 1997) of the specified objectives,
an amount between 2.25% and 4.5% of net income is set aside.
During fiscal year 1997, cash compensation under the short-term
portion of the plan was limited to 45.5% of the Chief Executive
Officer's and Chief Operating Officer's salaries and 11% to 37%
of the remaining executive officers' salaries. The remaining
dollars in the pool were allocated to long-term compensation
awards in the form of restricted stock not to exceed 45.5% of
the Chief Executive Officer's and Chief Operating Officer's
salaries and 11% to 37% of the remaining executive officers'
salaries. The excess was allocated to assist with a key
manager cash incentive plan and the balance reverted back to the
Corporation. Non-incentive stock options in the amount of
189,354 shares (.88% of outstanding shares) were awarded to
executives and key managers upon achievement of satisfactory
performance goals. (See the Summary Compensation Table on page
10.) Corporate performance is evaluated without reference to
non-recurring or extraordinary items affecting operating
results.
The plan provides that following allocations of cash bonuses
as provided above, the Committee shall inform the Corporation's
Stock Option Committee (the "Stock Option Committee") of such
allocations. Pursuant to a policy adopted in June 1993 and
subsequently amended and restated by the Stock Option Committee,
whose members are all outside directors, the Stock Option
Committee determines, in its discretion, whether, to whom and in
what amounts restricted stock and/or non-incentive stock options
will be awarded for any fiscal year. Shares of restricted
stockawarded under this policy generally vest over five years,
assuming the individual's continued service with the Corporation
or the Bank, thus helping to retain qualified executives. The
vesting of the stock options awarded under this policy is
determined by the Stock Option Committee at the time of the
award. This policy may be amended or terminated at any time by
action of the Committee.
An individual's eligibility for receiving awards under the
Executive Incentive Plan, and the size of his or her awards, is
dependent on the extent to which he or she achieves certain
individualized performance objectives established at the
beginning of the fiscal year. These objectives vary on the
basis of the individual officer's position with the Corporation
and/or the Bank, and relate both to the officer's individual
performance and the Corporation's corporate performance.
The Committee believes that this plan provides a direct link
between the value created for the Corporation's shareholders and
the compensation paid to executive officers. As previously
mentioned, executive officers are not eligible to receive any
compensation under this plan for a given fiscal year unless the
Corporation's net income for that year exceeds 85% of a
predetermined goal. The distribution of awards under the plan
is determined by the relative success of individual executive
officers in meeting specified performance objectives.
Fulfillment of these objectives promotes both the short- and the
long-term success of the Corporation and is in the best
interests of all the shareholders. During fiscal year 1997,
executive officers received awards in the form of cash bonuses
under the short-term portion of the plan and restricted stock
awards pursuant to the long-term portion of the plan.
Additionally, stock options which
7<PAGE>
<PAGE>
vest partially on the date of grant and on the next two
anniversaries of grant date were awarded at the discretion of
the Stock Option Committee described below.
. 1984 STOCK OPTION AND INCENTIVE PLAN, AS AMENDED AND
RESTATED. The Corporation maintains the 1984 Stock Option and
Incentive Plan as Amended and Restated (the "1984 Plan") as a
means of providing key employees the opportunity to acquire a
proprietary interest in the Corporation and to align their
interests with those of the Corporation's stockholders. Under
the 1984 Plan, participants are eligible to receive stock
options, stock appreciation rights ("SARs"), shares of
restricted stock or a cash bonus as an alternate for a portion
of, or all of, the restricted stock award. Awards under the
plan are subject to vesting and forfeiture as determined by the
Committee. Options and SARs are granted at the market value of
the Common Stock on the date of grant. Thus, such awards
acquire value only if the Corporation's stock price increases.
Restricted stock is granted at no cost. In June 1993, the Stock
Option Committee adopted a policy pursuant to which restricted
stock, or a cash award in lieu of restricted stock, may
be granted under the Stock Option and Incentive Plan following
the allocation of cash bonuses to executive officers under the
Corporation's Executive Incentive Plan. Pursuant to this
policy, as amended, the Stock Option Committee awarded
restricted stock limited to 45.5% of the Chief Executive
Officer's and Chief Operating Officer's salaries and 11% to 37%
of the remaining executive officers' salaries for an aggregate
of 25,174 shares of restricted stock. (For fiscal year 1996,
the Stock Option Committee awarded cash compensation under the
long-term portion of the plan to reduce the shortfall which
could be experienced by limitations under the Change in Control
Agreements if a change in control were to occur. See "--
Employment and Change in Control Agreements." ) Also, effective
May 14, 1997, non-incentive stock options to purchase an
aggregate of 123,500 shares were granted to the senior executive
officers and other executive officers of the Corporation and the
Bank. All executive officers were immediately vested in 60% of
such options with the remaining options to vest over a period of
two years in increments of 20% and 20%. The value of such
awards to the Chief Executive Officer and certain other
executive officers is reflected in the Summary Compensation
Table on page 10.
. 1996 STOCK OPTION AND INCENTIVE PLAN. The Corporation
also maintains the 1996 Stock Option and Incentive Plan (the
"1996 Plan"), in order to supplement the shares available for
issuance under the 1984 Plan and to further the Corporation's
compensation objectives. Under the 1996 Plan, participants are
eligible to receive stock options, SARs, and restricted stock
awards. Stock options and SARs are generally granted at the
market value at the date of grant, though the Stock Option
Committee may, at the election of a director or employee
selected by the Stock Option Committee, permit such individual
to receive stock options in lieu of cash compensation. The
exercise price of such stock options will be discounted below
the market value of the underlying Common Stock, such that the
aggregate discount on the exercise price of the stock options is
equal to the compensation foregone by the individual. Stock
options granted pursuant to the 1996 Plan are fully vested on
the date of grant, unless otherwise provided by the Stock Option
Committee. SARs and restricted stock may also be subject to
vesting, provided that the vesting period for restricted stock
will not exceed five years from the date of its award. See
"Directors' Compensation" for fiscal year 1997 awards by the
1996 Plan.
The Committee believes that the 1984 Plan and the 1996 Plan
align shareholders' and officers' interests and help to retain
and motivate executive officers to improve long-term shareholder
value.
8<PAGE>
<PAGE>
Compensation of the Chief Executive Officer
The Committee determines the Chief Executive Officer's
compensation on the basis of several factors. In determining
Mr. Fitzgerald's base salary for fiscal year 1997, the Committee
conducted surveys of compensation paid to chief executive
officers of similarly situated thrifts and non-diversified banks
both regionally and nationally. Mr. Fitzgerald received both
short- and long-term compensation under the Executive Incentive
Compensation Program in fiscal year 1997 based on his
achievement of objectives established by the Committee in the
following areas:
. Return on Average Assets
. Core Profitability
. Leadership Inside and Outside the Corporation
. Capital Compliance and Regulatory Guidelines
Mr. Fitzgerald achieved all his performance objectives in
these areas during fiscal year 1997. Accordingly, he received a
cash bonus under the short-term portion of the Plan equal to
45.5% of his annual salary. Pursuant to the policy of the Stock
Option Committee effective for fiscal year 1997, Mr. Fitzgerald
received 5,469 shares of restricted stock (45.5% of Mr.
Fitzgerald's salary) with a value of $203,046. Also, effective
May 14, 1997, Mr. Fitzgerald received non-incentive stock
options to purchase 30,000 shares of Common Stock at an exercise
price of $33.25 per share. Such options vest in increments of
60% on the date of grant and 20% on the next two anniversaries
of the date of grant.
The Committee believes that the Corporation's executive
compensation program serves the Corporation and all of its
shareholders by providing a direct link between the interests of
executive officers and those of shareholders generally, and by
helping to attract and retain qualified executive officers who
are dedicated to the long-term success of the Corporation.
COMPENSATION AND STOCK OPTION COMMITTEE
Talton K. Anderson
Carl G. Mammel, Chairman
James P. O'Donnell
9<PAGE>
<PAGE>
SUMMARY COMPENSATION TABLE
The following table sets forth the cash and noncash
compensation for each of the last three fiscal years awarded to
or earned by (i) the Chief Executive Officer, and (ii) the four
highest paid executive officers of the Corporation and the Bank
whose salary and bonus earned in fiscal year 1997 exceeded
$100,000 for services rendered in all capacities to the
Corporation and its subsidiaries.
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
AWARDS
-----------------------
ANNUAL COMPENSATION(1) RESTRICTED SECURITIES
NAME AND PRINCIPAL --------------------- STOCK UNDERLYING ALL OTHER
POSITION YEAR SALARY BONUS AWARDS(2) OPTIONS(3) COMPENSATION(4)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
William A. Fitzgerald 1997 $446,250 $203,046 $203,046 30,000 $35,700
Chairman and Chief Executive 1996 425,000 425,000 12,737 30,000 34,000
Officer of the Corporation 1995 372,514 192,500 192,085 8,855 29,801
and the Bank
James A. Laphen 1997 330,000 150,150 150,150 22,500 26,400
President and Chief Operating 1996 300,000 300,000 8,989 22,500 24,000
Officer of the Corporation 1995 253,342 135,000 134,697 6,210 20,267
and the Bank
Gary L. Matter 1997 161,333 60,310 60,310 5,800 12,906
Senior Vice President, 1996 151,983 122,400 3,060 6,725 12,159
Controller and Secretary of 1995 137,795 49,280 49,159 3,239 11,024
of the Corporation and the
Bank
Joy J. Narzisi 1997 121,667 48,100 48,100 5,200 9,733
Senior Vice President and 1996 108,887 88,000 2,219 4,835 8,711
Treasurer of the Corporation 1995 93,815 33,827 33,763 2,223 7,418
and the Bank
Jon W. Stephenson 1997 116,083 46,250 46,250 5,200 9,287
Senior Vice President 1996 105,965 84,800 2,104 4,659 8,477
of the Bank 1995 99,511 12,250 30,057 1,977 7,619
<FN>
______________
(1) Does not include certain perquisite and other personal benefits which do not exceed the lesser of
$50,000 or 10.0% of the individual's salary and bonus.
(2) Represents awards under the policy of the Stock Option Committee adopted in conjunction with the
Corporation's Executive Incentive Plan. See "Compensation and Stock Option Committee Report on
Executive Compensation -- Overview and Objectives." Restricted stock granted in fiscal years 1995, 1996
and 1997 vests over a period of five years, at a rate of 20.0% per year, assuming continued service with
the Corporation. As of June 30, 1997, the number and value, based on the closing sales price of the
Common Stock of $37.125 at June 30, 1997, of the unvested restricted stock holdings for Messrs.
Fitzgerald, Laphen, Matter, Ms. Narzisi and Mr. Stephenson, were 19,836 shares (value of $736,411),
13,306 shares (value of $493,985), 6,265 shares (value of $232,588), 4,473 shares (value of $166,060)
and 2,306 shares (value of $85,610), respectively. Dividends are payable on these shares if and to the
extent paid on the Common Stock generally. Upon a change in control of the Corporation, all
restrictions on the restricted stock immediately lapse. (For fiscal year 1996, the Stock Option
Committee awarded an additional cash bonus with a corresponding reduction in restricted stock awards.
See " -- Compensation and Stock Option Committee Report on Executive Compensation -- 1984 Stock Option
and Incentive Plan.")
(3) Non-incentive stock options awarded in fiscal year 1997 to Messrs. Fitzgerald, Laphen, Matter, Ms.
Narzisi and Mr. Stephenson vest over two years in increments of 60% on the date of grant and 20% and 20%
on the next two anniversaries of the date of grant. All per share data for prior fiscal years shown on
the table has been restated to reflect the three-for- two stock split effective January 14, 1997.
(4) Includes net contributions to the Bank's 401(k) Plan on behalf of each of the named executive officers
to match elective deferral contributions made by each to such plan and amounts paid under the Bank's
Supplemental Retirement Plan. Matching contributions under the Bank's 401(k) Plan amounted to $8,271,
$9,500, $9,900, $9,733 and $9,287 while the employer matching contributions, under the Supplemental
Retirement Plan benefits, were $27,429, $16,900, $3,007, $0 and $0 for Messrs. Fitzgerald, Laphen,
Matter, Ms. Narzisi and Mr. Stephenson, respectively.
</FN>
</TABLE>
10 <PAGE>
<PAGE>
Option Grants Table
The following table contains information concerning the
grant of stock options under the Corporation's Stock
Option and Incentive Plan to the Chief Executive Officer and
each of the other executive officers named in the preceding
Summary Compensation Table during the fiscal year ended June 30,
1997. All such option grants vest over a two year
period in increments of 60% on the date of grant and 20% on each
of the next two anniversaries of the grant date.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
----------------------------------------- POTENTIAL REALIZABLE
NUMBER OF % OF TOTAL VALUE AT ASSUMED ANNUAL
SECURITIES OPTIONS RATES OF STOCK PRICE
UNDERLYING GRANTED TO EXERCISE APPRECIATION FOR OPTION TERM
OPTIONS EMPLOYEES IN OR BASE EXPIRATION ------------------------------
NAME GRANTED FISCAL YEAR PRICE DATE 5% 10%
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
William A. Fitzgerald 30,000 15.84% $33.25 5/14/07 $627,322 $1,589,758
James A. Laphen 22,500 11.88 33.25 5/14/07 470,492 1,192,319
Gary L. Matter 5,800 3.06 33.25 5/14/07 121,282 307,353
Joy J. Narzisi 5,200 2.75 33.25 5/14/07 108,736 275,558
Jon W. Stephenson 5,200 2.75 33.25 5/14/07 108,736 275,558
</TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR, AND FISCAL
YEAR-END OPTION VALUE
The following table sets forth information concerning the
exercise of options by the Chief Executive Officer and the other
named executive officers during the last fiscal year, as well as
the value of such options held by such persons at the end of the
fiscal year. (All per share data has been restated to reflect
the three-for-two stock split effective January 14, 1997.)
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING VALUE OF
UNEXERCISED UNEXERCISED
OPTIONS IN-THE-MONEY
AT FISCAL OPTIONS AT
YEAR-END FISCAL YEAR-END
SHARES ACQUIRED VALUE (EXERCISABLE/ (EXERCISABLE/
NAME ON EXERCISE REALIZED UNEXERCISABLE) UNEXERCISABLE)(1)
- ---- --------------- -------- -------------- -----------------
<S> <C> <C> <C> <C>
William A. Fitzgerald 10,350 $274,275 196,351/22,000 $5,408,721/$159,450
James A. Laphen 6,000 163,376 60,510/16,500 1,193,825/119,588
Gary L. Matter 915 26,230 15,099/3,665 236,903/24,182
Joy J. Narzisi 1,997 61,817 22,126/3,047 528,259/18,982
Jon W. Stephenson -- -- 8,824/3,012 91,583/18,585
<FN>
__________
(1) Based on the closing sales price of the Common Stock as reported on the
New York Stock Exchange on June 30, 1997, which was $37.125.
</FN>
</TABLE>
EMPLOYMENT AND CHANGE IN CONTROL AGREEMENTS
Set forth below is a discussion of certain employment and
change in control agreements entered into between
the Corporation and the Bank and those executive officers listed
in the Summary Compensation Table on page 10.
11<PAGE>
<PAGE>
The agreement with William A. Fitzgerald, which became
effective in June 1995, provides for Mr. Fitzgerald's
employment as Chairman of the Board and Chief Executive Officer
of the Corporation and the Bank for a term of three years.
Pursuant to the agreement, Mr. Fitzgerald receives an annual
salary and bonus determined by agreement with the Board of
Directors, but in no event less than the rate of compensation
Mr. Fitzgerald received on June 8, 1995. The base compensation
following his election as Chairman of the Board of Directors was
$385,000. Effective June 1, 1997, the Corporation and the Bank
entered into an employment agreement with James A. Laphen, which
provides for Mr. Laphen's employment as President and Chief
Operating Officer of the Corporation and the Bank for a term of
three years. Pursuant to this agreement, Mr. Laphen receives an
annual salary and bonus determined by the agreement with
the Board of Directors, but in no event less than the rate of
compensation Mr. Laphen received on June 1, 1997. Mr. Laphen's
base compensation on June 1, 1997 was $330,000. The Boards of
Directors of the Corporation and the Bank shall review the
employment agreements annually to consider extending the
agreement for an additional one-year period beyond the then
effective expiration date. The contracts provide for
termination for cause or in certain events specified by
regulatory authorities. The contracts are also terminable by
the Bank without cause wherein Messrs. Fitzgerald and Laphen
would be entitled to receive all compensation and benefits
through the effective date of termination, plus a severance
payment equal to 36 months of base salary. Messrs. Fitzgerald
or Laphen shall be entitled to the same benefits and severance
in the event either becomes disabled while the agreement is in
effect. In the event Messrs. Fitzgerald or Laphen dies while
the agreement is in effect, his heirs shall receive a severance
payment equal to 12 months of base salary. The agreements
provide, among other things, for Messrs. Fitzgerald's and
Laphen's participation in an equitable manner in all benefits
available to executive officers of the Corporation and the Bank,
including (i) short-term and long-term incentive compensation
and deferred compensation; (ii) health, disability, life
insurance, retirement and vacation benefits; and (iii) any
benefits available under perquisite programs.
The Corporation and the Bank have also entered into change in
control agreements with Messrs. Fitzgerald, Laphen, Matter, Ms.
Narzisi and Mr. Stephenson. Under these agreements, in the
event of the executive's involuntary termination of employment
in anticipation of, or after, a change in control of the
Corporation or the Bank, other than for "cause," the executive
will be paid in equal monthly installments, the base salary and
all commissions and bonuses (including short- and long-term
incentive compensation awards and stock options granted under
the Corporation's executive incentive plan) in effect at the
time of termination for a period of 35.88 months. During this
period, the executive shall also continue to participate in any
health, disability, life insurance and perquisite plans of any
successor corporation in which such executive was entitled to
participate with the Corporation prior to the change in control.
All benefits and payments under the agreements shall be reduced,
if necessary, to the largest aggregate amount that will result
in no portion thereof being subject to federal excise tax or
being nondeductible to the Corporation and the Bank for federal
income tax purposes. Mr. Matter, Ms. Narzisi and Mr.
Stephenson's severance shall be reduced by amounts received by
the executive as a result of alternative employment obtained
during the period in which salary, commissions and bonuses are
payable under the change in control agreements. Further,
Messrs. Fitzgerald's and Laphen's severance payments under their
change in control agreements shall be reduced by the amount of
severance received under their employment agreements.
A "change in control" shall be deemed to have occurred under
these agreements in each of the following events: (i) at any
time a majority of the directors of the Corporation or the Bank
are not the persons for whom election proxies have been
solicited by the Boards of Directors of the Corporation and the
Bank, or persons then serving as directors appointed by such
Boards, except where such appointments are necessitated by
removal of directors; (ii) at any time 49% or more of the
outstanding stock of the Corporation or the Bank is acquired or
beneficially owned by any person or entity (excluding the
Corporation, the Bank or the executive) or any combination of
persons or entities acting in concert; or (iii) at any time the
shareholders of the Corporation or the Bank approve an agreement
to merge or consolidate the Corporation or the Bank with or into
another corporation, or to sell or otherwise dispose of all, or
substantially all, of the assets of the Corporation or the Bank.
The executive shall also be entitled to receive such payment in
the event of a "constructive involuntary termination," which
under the terms of the agreements shall be deemed to have
occurred if, in anticipation of or following a change in
control, (i) the agreement or the executive's employment is
terminated, (ii) the executive's compensation is reduced,
responsibilities diminished or job title lowered, (iii) the
level of the executive's participation in incentive compensation
is reduced or eliminated, (iv) the executive's
12<PAGE>
<PAGE>
benefit coverage or perquisites are reduced or eliminated,
except to the extent such reduction or elimination applies to
all other employees, or (v) the executive's office location is
changed to a location more than 50 miles from the location of
the executive's office at the time of the change in control.
Pursuant to the terms of a separate agreement between the
Bank and William A. Fitzgerald, in the event of Mr. Fitzgerald's
termination of employment with the Bank, Mr. Fitzgerald will be
entitled to receive in 120 equal monthly installments an amount
equal to three times his highest annual salary received from the
Bank during the five-year period ending with the close of the
fiscal year in which he attains age 65 (or, in the case of death
or disability prior to age 65, the year in which he became
disabled or died). In the event of his death before the payment
of all installments, all remaining installments shall be paid to
his designated beneficiary. In the event of the death of both
Mr. Fitzgerald and the designated beneficiary, all remaining
unpaid installments shall be paid in one lump sum payment to the
estate of the designated beneficiary. Pursuant to the terms of
the agreement, the right to receive any and all unpaid
installments will be forfeited upon the occurrence of any of the
following events (i) without the approval of the Board of
Directors, Mr. Fitzgerald has or possesses, directly or
indirectly, any interest competing with or inimical to the
interests of the Bank within an area within a 300 mile radius of
Omaha, Nebraska, or (ii) Mr. Fitzgerald engages in any activity
or conduct which, in the opinion of the Board, is inimical to
the interests of the Bank.
________________________________________________________________
DIRECTORS' COMPENSATION
________________________________________________________________
Directors receive $1,000 per month for service on the Board
of the Corporation and $1,000 per month plus $750 per meeting
attended for service on the Board of the Bank, with the
exception of William A. Fitzgerald, who does not receive
director's compensation. In addition, on May 14, 1997, each
non-employee director of the Corporation was granted non-
incentive stock options to purchase 3,000 shares of Common Stock
at an exercise price of $33.25 per share. Board members
receiving remuneration are paid their retainer fees one-half in
cash and one-half in Common Stock. Fees for members of the
committees of the Corporation and the Bank are paid at the rate
of $750 per committee meeting attended. The chairman of the
Audit Committee, Compensation and Stock Option Committee, and
the Finance Committee each receive an additional $2,000 per
year.
Pursuant to the 1996 Stock Option and Incentive Plan,
effective May 14, 1997, non-incentive stock options to
purchase an aggregate of 27,000 shares were granted to the
non-employee directors of the Corporation and the Bank.
________________________________________________________________
TRANSACTIONS WITH MANAGEMENT AND OTHERS
________________________________________________________________
The Bank offers first and second mortgages, refinance, equity
and various consumer loans to its directors, officers and
employees. Loans to executive officers and directors are made
in the ordinary course of business on substantially the same
terms and collateral, including interest rates and loan fees
charged, as those of comparable transactions prevailing at the
time and do not involve more than the normal risk of
collectibility or present other unfavorable features.
On August 21, 1996, the Corporation consummated the
repurchase of 1,875,150 shares (after restatement for the
three-for-two stock split effective January 14, 1997) (8.3% of
the outstanding shares of Common Stock prior to the repurchase)
of Common Stock from CAI Corporation ("CAI"), a Dallas-based
investment company, for an aggregate purchase price of $48.9
million. Such purchase price, excluding transaction costs
incurred by the Corporation for this repurchase, consisted of
cash of $28.2 million and the surrender of a warrant (valued at
$20.7 million) which would have enabled the Corporation to
purchase 99 shares of non-voting common stock of CAI. The
Corporation also reimbursed certain expenses of CAI and paid CAI
cash in lieu of the pro rata portion of any dividend CAI
otherwise would have received for the quarter ended September
30, 1996. Concurrent with the close of the repurchase, Robin R.
Glackin and Steven M. Ellis, who had served as directors of the
Corporation and who also serve as executive officers of CAI,
resigned from the Board of Directors.
13
<PAGE>
COMPARATIVE STOCK PERFORMANCE GRAPH
The graph set forth below compares the cumulative total
shareholder return on the Common Stock over the last five years
with the cumulative total return on the S&P 500 Index and an
index comprised of the top 50 publicly traded thrifts in the
United States based on total asset size over the same period.
Cumulative total return on the stock or the index equals the
total increase in value since June 30, 1992, assuming
reinvestment of all dividends paid into the stock or the index,
respectively. The graph was prepared assuming that $100 was
invested on June 30, 1992, in the Common Stock and in the
respective indices.
June 30, 1992 through June 30, 1997
Line graph appears here depicting the cumulative total
shareholder return of $100 invested in the Common Stock as
compared to $100 invested in the S&P 500 Index and an index
comprised of the top 50 publicly traded thrifts in the United
States. Line graph begins at June 30, 1992 and plots the
cumulative total return at June 30, 1993, 1994, 1995, 1996 and
1997. Plot points are provided below.
<TABLE>
<CAPTION>
Cumulative Total Return
--------------------------------------------
6/92 6/93 6/94 6/95 6/96 6/97
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Commercial Federal
Corporation 100 247 221 256 364 534
Peer Group 100 96 97 112 143 235
S & P 500 100 114 115 145 183 247
</TABLE>
14<PAGE>
<PAGE>
_________________________________________________________________
PROPOSAL II - APPROVAL OF INCREASE IN AUTHORIZED SHARES
_________________________________________________________________
GENERAL. The Corporation is currently authorized to issue
25,000,000 shares of Common Stock. The Corporation's Board of
Directors recommends that stockholders approve an amendment (the
"Share Amendment") to Article IV of the Corporation's Articles of
Incorporation that would increase the authorized shares of Common
Stock from 25,000,000 shares to 50,000,000 shares. The number of
authorized shares of preferred stock will remain at 10,000,000
shares. If the Share Amendment is approved by the Corporation's
stockholders, the first sentence of ARTICLE IV of the
Corporation's Articles of Incorporation as amended will read as
follows:
The aggregate number of shares of common stock which this
corporation shall have authority to issue is 50,000,000 shares,
having a par value of $.01 each.
PURPOSE. The Corporation proposes to increase the number of
authorized shares of Common Stock to 50,000,000 shares to provide
additional shares for general corporate purposes, including the
Corporation's pending acquisitions of Liberty Financial
Corporation ("Liberty"), Mid-Continent Bancshares, Inc.
("Mid-Continent") and First National Bank Shares, LTD ("First
National") and possible future acquisitions, stock dividends and
splits, raising additional capital and issuances pursuant to
employee stock benefit plans. Since 1993, the Corporation has
consummated a total of three acquisitions of financial
institutions in exchange at least in part for shares of the
Common Stock. The Corporation also approved and paid in January
1997 a three-for-two stock split effected in the form of a 50%
stock dividend to stockholders. As of June 30, 1997, there were
21,552,837 shares of Common Stock outstanding and an additional
1,844,004 shares were reserved for issuance pursuant to various
stock-based employee benefit plans of the Corporation. This
leaves the Corporation with 1,603,159 authorized but unissued,
unreserved and uncommitted shares of Common Stock available for
issuance.
On August 18, 1997, the Corporation announced that it had
entered into an agreement with Liberty to acquire all of the
outstanding shares of the common stock of Liberty. On September
3, 1997, the Corporation announced it had entered into an
agreement with Mid-Continent to acquire all of its issued and
outstanding shares and on September 12, 1997, the Corporation
announced it had entered into an agreement with First National to
acquire all of its outstanding shares. Pursuant to these
agreements, approximately 5,041,252 additional shares of Common
Stock are to be issued. Pursuant to the terms of these
agreements, approval by the Corporation's stockholders of this
amendment to the Corporation's Articles of Incorporation is a
condition to the Corporation's obligation to close the
transactions. The Corporation would not be able to consummate
all of these acquisitions without approval of the Share
Amendment. In addition, the Board of Directors believes that an
increase in the total number of shares of authorized Common Stock
above the level necessary to consummate the pending acquisitions
will better enable the Corporation to meet its future
needs, and give it greater flexibility in responding quickly to
advantageous business opportunities in the future including
possible future acquisition opportunities. As of the date
hereof, however, there are no present agreements for issuing
a material number of additional shares of Common Stock from the
currently authorized shares of Common Stock or the additional
shares of Common Stock proposed to be authorized pursuant to the
Share Amendment other than the Liberty, Mid-Continent and First
National acquisitions.
DILUTION. The Corporation's issuance of shares of Common
Stock, including the additional shares that will be authorized if
the proposed Share Amendment is adopted, may dilute the present
equity ownership position of current holders of Common Stock and
may be made without stockholder approval, unless otherwise
required by applicable laws or stock exchange regulation. Under
existing New York Stock Exchange regulations, approval of a
majority of the holders of Common Stock would be required in
connection with any transaction or series of related transactions
that would result in the original issuance of additional shares
of Common Stock, other than in a public offering for cash, (i)
if the Common Stock (including securities convertible into or
exercisable for Common Stock) has, or will have upon issuance,
voting power equal to or in excess of 20% of the voting power
outstanding before the issuance of such Common Stock; (ii) if the
number of shares of Common Stock to be issued is or will be equal
to or in excess of 20% of the number of shares outstanding before
the issuance of the Common Stock; or (iii) if the issuance would
result in a change in control of the Corporation.
15<PAGE>
<PAGE>
POTENTIAL ANTI-TAKEOVER EFFECTS. The additional authorized
but unissued shares of the Common Stock that would become
available if the Share Amendment is approved could be used,
whether alone or in tandem with the Corporation's Shareholder
Rights Plan, described below, to make a change in control of the
Corporation more difficult and expensive. Under certain
circumstances, such shares could be used to create impediments
or to frustrate persons seeking to cause a takeover or to
otherwise gain control of the Corporation. Such shares could be
sold to purchasers who might side with the Board in opposing a
takeover bid that the Board determines not to be in the best
interests of the Corporation and its stockholders. The Share
Amendment might also have the effect of discouraging an attempt
by another person or entity, through the acquisition of a
substantial number of shares of the Corporation's Common Stock,
to acquire control of the Corporation with a view to consummating
a merger, sale of all or any part of the Corporation's
assets, or a similar transaction, since the issuance of new
shares could be used to dilute the stock ownership of such
person or entity.
The Corporation also has in effect a plan (the "Rights
Plan") pursuant to which each holder of the Common Stock
outstanding on December 19, 1988 (the initial record date for the
Rights Plan) and thereafter has received, and each future holder
of shares of Common Stock will receive, a dividend of one stock
purchase right (a "Right"). The Rights consist of primary rights
("Primary Rights"), which generally entitle the holders to
purchase shares of Common Stock at 20% of the market price of
such shares in the event any person acquires an interest in 15%
or more of the outstanding shares of Common Stock without
complying with a procedure intended to ensure fair treatment of
all shareholders of the Corporation, and secondary rights (the
"Secondary Rights"), which generally entitle the holders
thereof to purchase shares of the Corporation's Series A Junior
Participating Preferred Stock ("Junior Preferred Stock")
in the event a person acquires an interest in 25% or more of the
outstanding shares of Common Stock without complying with such
procedural requirements. The Rights are designed to protect the
interests of the Corporation and its stockholders against
coercive takeover tactics, by encouraging potential acquirors to
negotiate with the Board of Directors acting on behalf of all
stockholders. The Rights Plan may also, but is not intended to,
deter potential acquirors. The approval of the Share Amendment,
together with the Rights Plan, may also deter such takeover
proposals, given the potential cumulative dilutive effect on an
acquiror's ownership of the Common Stock if any additional
shares of Common Stock authorized by the Share Amendment and
shares of Junior Preferred Stock pursuant to the Rights were
issued. See "-- Dilution."
RECOMMENDATION; VOTE REQUIRED. The Board of Directors
believes that the Share Amendment is in the best interests of the
stockholders of the Corporation. Approval of this proposal
requires a vote in favor of the Share Amendment by the holders of
a majority of the votes cast at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR
THE PROPOSAL TO AMEND THE CORPORATION'S ARTICLES OF INCORPORATION
TO INCREASE THE CORPORATION'S AUTHORIZED SHARES OF COMMON STOCK,
WHICH PROPOSAL IS IDENTIFIED AS PROPOSAL II ON THE ENCLOSED PROXY
CARD.
_________________________________________________________________
PROPOSAL III - APPROVAL OF VARIABLE RANGE FOR MEMBERSHIP OF
BOARD OF DIRECTORS
_________________________________________________________________
GENERAL. Pursuant to Article VII of the Corporation's
Articles of Incorporation, the Board of Directors of the
Corporation is to consist of nine members. The Corporation's
Board of Directors recommends that stockholders approve an
amendment (the "Director Amendment") to Article VII to establish
a variable range for the number of members on the Board of
Directors from nine to 12 members with the precise number of
directors to be specified in the Corporation's Bylaws. If this
amendment is approved, the second sentence of ARTICLE VII of the
Corporation's Articles of Incorporation as amended will read as
follows:
The number of directors shall be not less than nine nor more
than twelve, as provided in the By-laws of the Corporation.
16<PAGE>
<PAGE>
PURPOSE; IMPACT ON CURRENT NUMBER OF MEMBERS ON BOARD. The
purpose of the Director Amendment is to increase the
Corporation's flexibility to obtain the services of up to three
additional qualified individuals as a director of the Corporation
without the need for a Board vacancy to exist as a result of the
death, disability, removal or resignation of a current director.
In particular, the Corporation would be able to add additional
directors, up to the maximum, if prudent to do so, in connection
with future acquisitions.
Assuming approval of the Director Amendment is received, the
Board of Directors intends to initially set the number of
directors at nine, the current number of directors. In
connection with the proposed acquisition of Liberty, the
Corporation has agreed to appoint Mr. William A. Krause, Chairman
of Liberty, as a director of the Corporation immediately after
the consummation of the Liberty acquisition. The Board of
Directors expects that it will amend the Bylaws at such time as
to increase the number of directors to ten. With the exception
of the addition of Mr. Krause, the Corporation does not have any
plans at the present time to further increase the number of
members on the Board.
Assuming approval of the Director Amendment, future changes
to the number of members on the Board of Directors may only be
made within the range from nine to 12 directors by a Bylaw
amendment adopted by either the Board of Directors or the
stockholders. A change in the minimum and maximum limits of the
range could only be effected by an amendment to the Corporation's
Articles of Incorporation adopted by the stockholders.
RECOMMENDATION; VOTE REQUIRED. The Board of Directors
believes that the Director Amendment is in the best interests of
the stockholders of the Corporation. Approval of this proposal
requires the affirmative vote of a majority of the votes eligible
to be cast at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR
THE PROPOSAL TO AMEND THE CORPORATION'S ARTICLES OF INCORPORATION
TO ESTABLISH A VARIABLE RANGE FOR THE NUMBER OF MEMBERS ON THE
BOARD OF DIRECTORS, WHICH PROPOSAL IS IDENTIFIED AS PROPOSAL III
ON THE ENCLOSED PROXY CARD.
_________________________________________________________________
STOCKHOLDER PROPOSALS
_________________________________________________________________
In order to be eligible for inclusion in the Corporation's
proxy materials for next year's Annual Meeting of Stockholders,
any stockholder proposal to take action at such meeting must be
received at the Corporation's executive office at 2120 South 72nd
Street, Omaha, Nebraska 68124, no later than June 19, 1998. Any
such proposal shall be subject to the requirements of the proxy
rules adopted under the Securities Exchange Act of 1934, as
amended.
_________________________________________________________________
INDEPENDENT AUDITORS
_________________________________________________________________
The Board of Directors presently has renewed the
Corporation's arrangements with Deloitte & Touche llp to
be its auditors for the 1998 fiscal year. Deloitte & Touche llp
were the Corporation's independent auditors for the 1997 fiscal
year. Representatives of Deloitte & Touche llp are expected to
be present at the Meeting to respond to appropriate questions
from stockholders and will have the opportunity to make a
statement if they so desire.
_________________________________________________________________
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
_________________________________________________________________
Pursuant to regulations promulgated under the Securities
Exchange Act of 1934, as amended, the Corporation's officers,
directors and persons who own more than 10 percent of the
outstanding Common Stock ("Insiders") are required to file
reports detailing their ownership and changes of ownership in
such Common Stock, and to furnish the Corporation with copies of
all such reports. Based solely on its review of the copies of
such reports or written
17<PAGE>
<PAGE>
representations that no such reports were necessary that the
Corporation received during the past fiscal year or with respect
to the last fiscal year, management believes that during the
fiscal year ended June 30, 1997, all of the Corporation's
Insiders complied with these reporting requirements with the
exception of Melissa M. Beumler, Ronald P. Cheffer, John J.
Griffith, Robert D. Taylor, Aldo J. Tesi, Robert E. Gruwell,
Monte M. Deere and Michael J. Hoffman, each of whom did not
timely file their Initial Statement of Beneficial Ownership of
Securities, although all such reports have since been filed with
the Securities and Exchange Commission.
_________________________________________________________________
EXPENSES OF SOLICITATION
_________________________________________________________________
The cost of soliciting proxies will be borne by the
Corporation. The Corporation will reimburse brokerage firms and
other custodians, nominees and fiduciaries for reasonable
expenses incurred by them in sending proxy materials to the
beneficial owners of Common Stock. In addition to solicitations
by mail, directors, officers and regular employees of the
Corporation may solicit proxies personally or by telegraph,
telephone or other electronic means without additional
compensation. The Corporation has retained D.F. King & Co.,
Inc., a professional proxy solicitation firm, to assist in the
solicitation of proxies by mail, personally or by telephone or
other means of communication, for a fee estimated at $6,500 plus
expenses.
_________________________________________________________________
ADDITIONAL INFORMATION
_________________________________________________________________
The Board of Directors is not aware of any business to come
before the Meeting other than those matters described above in
this Proxy Statement. However, if any other matters should
properly come before the Meeting, it is intended that proxies in
the accompanying form will be voted in respect thereof as
determined by a majority of the Board of Directors.
The Corporation's 1997 Annual Report to Stockholders,
including financial statements, is being mailed to all
stockholders of record as of the close of business on October 6,
1997. Any stockholder who has not received a copy of such Annual
Report may obtain a copy by writing to the Secretary of the
Corporation. Such Annual Report is not to be treated as a part
of the proxy solicitation material or as having been incorporated
herein by reference.
_________________________________________________________________
FORM 10-K
_________________________________________________________________
A COPY OF THE CORPORATION'S FORM 10-K FOR THE FISCAL YEAR
ENDED JUNE 30, 1997 AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION WILL BE FURNISHED WITHOUT CHARGE TO STOCKHOLDERS AS OF
THE RECORD DATE UPON WRITTEN REQUEST TO THE SECRETARY, COMMERCIAL
FEDERAL CORPORATION, 2120 SOUTH 72ND STREET, OMAHA, NEBRASKA
68124.
_________________________________________________________________
_________________________________________________________________
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Gary L. Matter
GARY L. MATTER
SECRETARY
Omaha, Nebraska
October 17, 1997
18<PAGE>
<PAGE>
[FORM OF PROXY CARD]
COMMERCIAL FEDERAL CORPORATION
This Proxy is solicited by the Board of Directors for the
November 18, 1997 Annual Meeting of Stockholders
The undersigned hereby appoints Robert F. Krohn, Robert S.
Milligan and Robert D. Taylor, and each of them, with full power
of substitution, as attorneys in fact, agents and proxies for the
undersigned to vote all of the shares of Common Stock, par value
$.01 per share, of COMMERCIAL FEDERAL CORPORATION (the
"Corporation") which the undersigned is entitled to vote at the
Annual Meeting of Stockholders to be held at the Holiday Inn
Central Convention Centre, "Holiday C" Meeting Room, 3321 South
72nd Street, Omaha, Nebraska on Tuesday, November 18, 1997 at
10:00 a.m., local time, and at any and all adjournments or
postponements thereof (the "Meeting") as indicated below and as
directed by the Board of Directors, with respect such other
matters as may properly come before the Meeting.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO DIRECTIONS
ARE SPECIFIED, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS
PROXY "FOR" PROPOSALS I AND II. IF OTHER MATTERS ARE PROPERLY
BROUGHT BEFORE THE MEETING, THIS PROXY WILL BE VOTED BY THOSE
NAMED IN THIS PROXY AS DIRECTED BY A MAJORITY OF THE BOARD OF
DIRECTORS. There is cumulative voting in the election of
directors and, unless otherwise indicated by the stockholder, a
vote for the nominees listed in Proposal I will give the proxies
discretionary authority to cumulate all votes to which the
undersigned is entitled and to allocate such votes in favor of
one or more of such nominees, as the proxies may determine.
THE UNDERSIGNED HEREBY REVOKES ANY PREVIOUS PROXIES WITH
RESPECT TO THE MATTERS COVERED BY THIS PROXY.
The Board of Directors Recommends a Vote "FOR" Proposal I and II
and III
I. The election as directors of all nominees listed below
(except as marked to the contrary):
For a term to expire in 1999
Michael P. Glinsky
For terms to expire in 2000
Talton K. Anderson, Carl G. Mammel and
James P. O'Donnell
[ ] FOR [ ] WITHHOLD AUTHORITY FOR ALL NOMINEES
INSTRUCTION: TO WITHHOLD YOUR VOTE FOR ANY INDIVIDUAL
NOMINEE(S), MARK "FOR" ABOVE AND WRITE THE NAME(S) OF
THE NOMINEE(S) FOR WHICH YOU DO NOT WISH TO VOTE ON THE
LINE BELOW.
_____________________________________
II. The approval of an amendment to the Corporation's
Articles of Incorporation increasing the number of authorized
shares.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
III. The approval of an amendment to the Corporation's
Articles of Incorporation to establish a range for the size of
the Board of Directors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
Please sign exactly as your name appears on
this card. Joint owners should each sign
personally. Corporation proxies should be
signed in corporate name by an authorized
officer. Executors, administrators, trustees
or guardians should give their title when
signing.
Date: ____________________________________
Signature(s): _____________________________
______________________________
PLEASE SIGN, DATE AND MAIL YOUR PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE.
