<PAGE> 1
PRELIMINARY DRAFT
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[X] Preliminary proxy statement [ ] Confidential for use of the
Commission only (as
[ ] Definitive proxy statement permitted by Rule 14a-6(e)
(2)).
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12.
Merchants and Manufacturers Bancorporation, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specific 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.
<PAGE> 2
May 5, 1999
To: The Shareholders of Merchants & Manufacturers Bancorporation, Inc.
You are cordially invited to attend the Annual Meeting of Shareholders of
Merchants & Manufacturers Bancorporation; Inc. scheduled for 4:00 P.M. on
Tuesday, May 25, 1999, at Alverno College, Milwaukee, Wisconsin. The meeting
will take place in Wehr Hall, #1 indicated on the enclosed map. Enter parking
lot A at the southwest corner of the Alverno campus from Morgan Avenue.
The matters expected to be acted upon at the meeting are described in detail in
the attached Notice of Annual Meeting and Proxy Statement.
We have previously informed you that Merchants and Pyramid Bancorp. (the holding
company for Grafton State Bank) have signed an agreement whereby Pyramid will be
merged into Merchants and Grafton State Bank will become a subsidiary of
Merchants. You will be asked to vote on the merger at a special meeting to be
called after required regulatory filings have been completed and after you have
received proxy materials explaining the merger in detail. For that reason, we
will not be able to discuss the merger at the Annual Meeting on May 25, 1999.
Your Board of Directors and management look forward to greeting you and
discussing the condition of your corporation with you.
Please be sure to sign and return the enclosed proxy card whether or not you
plan to attend the meeting so that your shares will be voted. If you do attend
the meeting, you may revoke your proxy and vote in person if you prefer. The
Board of Directors joins me in hoping that you will attend.
Sincerely yours,
By: /s/ Michael J. Murry
--------------------------------
Michael J. Murry,
Chairman of the Board of Directors
Enclosure
<PAGE> 3
MERCHANTS AND MANUFACTURERS BANCORPORATION, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 25, 1999
TO THE SHAREHOLDERS OF MERCHANTS AND MANUFACTURERS BANCORPORATION, INC.:
The Annual Meeting of Shareholders of Merchants and Manufacturers
Bancorporation, Inc. ("Merchants"), will be held at Alverno College, 3401 South
39th Street, Milwaukee, Wisconsin, on Tuesday, May 25, 1999, at 4:00 p.m., for
the purpose of considering and voting on:
1. To elect six Directors to serve until the annual meeting in the year
2002 as Class I Directors. Management's nominees are named in the
accompanying Proxy Statement.
2. To consider and vote on a proposal to amend Article IV of Merchants'
Articles of Incorporation, as amended, to increase the number of
authorized shares of Common Stock from 3,000,000 to 6,000,000.
3. Such other business as may properly come before the meeting and all
adjournments thereof.
The Board of Directors has fixed April 19, 1999, as the record date for
determining the shareholders of Merchants and Manufacturers Bancorporation,
Inc., entitled to notice of and to vote at the meeting, and only holders of
Common Stock of Merchants and Manufacturers Bancorporation, Inc. of record at
the close of business on such date will be entitled to notice of and to vote at
such meeting and all adjournments.
THE BOARD OF DIRECTORS OF MERCHANTS AND MANUFACTURERS BANCORPORATION, INC.
RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF THE SIX PERSONS NOMINATED
BY THE BOARD OF DIRECTORS AND NAMED IN THE PROXY STATEMENT, AND FOR THE ADOPTION
OF PROPOSAL 2 AS DISCUSSED IN THE PROXY STATEMENT.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE MARK, SIGN, DATE AND
RETURN THE ENCLOSED PROXY PROMPTLY IN THE ACCOMPANYING ENVELOPE. IT IS IMPORTANT
THAT YOUR SHARES BE REPRESENTED AT THE MEETING, WHETHER YOUR HOLDINGS ARE LARGE
OR SMALL. IF YOU DO ATTEND THE MEETING, OR FOR ANY OTHER REASON DESIRE TO REVOKE
YOUR PROXY, YOU MAY DO SO AT ANY TIME BEFORE IT IS VOTED.
Milwaukee, Wisconsin By Order of the Board of Directors of
May 5, 1999 Merchants and Manufacturers Bancorporation, Inc.
By: /s/ Michael J. Murry
--------------------------------
Michael J. Murry, Chairman of the Board of Directors
<PAGE> 4
MERCHANTS & MANUFACTURERS BANCORPORATION, INC.
14100 WEST NATIONAL AVENUE
NEW BERLIN, WISCONSIN 53151
PROXY STATEMENT
ANNUAL MEETING - MAY 25, 1999
VOTING OF PROXIES AND REVOCABILITY
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Directors of Merchants & Manufacturers Bancorporation, Inc.,
hereinafter called "Merchants," to be voted at the Annual Meeting of
Shareholders to be held on Tuesday, May 25, 1999, at 4:00 P.M., at Alverno
College, 3401 South 39th Street, Milwaukee, Wisconsin, and at any adjournment(s)
thereof (the "Annual Meeting").
The expense of printing and mailing proxy material, including forwarding expense
to beneficial owners of stock held in the name of another, will be borne by
Merchants. No solicitation of proxies other than by mail is contemplated, except
that officers or employees of Merchants or its subsidiaries may solicit the
return of proxies from certain shareholders by telephone. The Proxy Statement
and the accompanying Proxy are being sent to Merchants' shareholders commencing
on or about May 5, 1999.
Shares owned through participation in Merchants' Dividend Reinvestment Plan will
be included on the Proxy you receive and will be voted in accordance with your
instructions in the same manner as shares registered in your own name.
Arrangements will be made with brokerage houses, custodians, nominees, and other
fiduciaries to send proxy material to their principals.
The presence, in person or by proxy, of a majority of the shares of Common Stock
outstanding on the record date is required for a quorum, with respect to the
matters on which action is to be taken at the Annual Meeting. Abstentions will
be treated as shares that are present and entitled to vote for purposes of
determining the presence of a quorum, but as unvoted for purposes of determining
the approval of any matter submitted to the shareholders for a vote.
Shares as to which proxies have been executed will be voted as specified in the
proxies. If no specification is made, the shares will be voted "FOR" the
election of management's nominees as directors and FOR adoption of Proposal 2 as
described below. If additional matters are properly presented, the persons named
in the proxy will have discretion to vote in accordance with their own judgment
in such matters.
Proxies may be revoked at any time prior to the exercise thereof by filing with
the Secretary of Merchants a written revocation or a duly executed proxy bearing
a later date. Shareholders who are present at the Annual Meeting may revoke
their proxy and vote in person, if they so desire.
RECORD DATE AND VOTING SECURITIES
The Board of Directors has fixed the close of business on April 19, 1999, as the
record date (the "Record Date") for the determination of shareholders entitled
to notice of, and to vote at, the Annual Meeting. The securities of Merchants
entitled to be voted at the Annual Meeting consist of shares of its Common
Stock, $1.00 par value ("Common Stock") of which 1,489,754 shares were issued
and outstanding at the
<PAGE> 5
close of business on the Record Date. Only shareholders of record at the close
of business on the Record Date will be entitled to receive notice of and to vote
at the Annual Meeting.
Each share of Common Stock is entitled to one vote on all matters. The Common
Stock carries no cumulative voting rights.
SHAREHOLDER PROPOSALS
Any shareholders desirous of including any proposal in Merchants' proxy
soliciting material for the next regularly scheduled annual meeting of
shareholders of Merchants must submit their proposal, in writing, at Merchants'
executive offices not later than January 2, 2000. Any such proposal must comply
with Rule 14a-8 of Regulation 14A of the proxy rules of the Securities and
Exchange Commission.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
No person is known to Merchants to own beneficially more than 5% of the
outstanding shares entitled to vote at the Annual Meeting.
ANNUAL REPORT
The 1998 Annual Report of Merchants, which includes financial statements for the
years ended December 31, 1998, 1997 and 1996, has been mailed concurrently with
this proxy statement to shareholders as of the Record Date. The Annual Report
does not constitute a part of the proxy material.
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors of Merchants is divided into three classes designated as
Class I, II and III, as nearly equal in size as possible, with each class of
directors serving staggered three-year terms. The term of office of directors in
Class I expires at the Annual Meeting. At the Annual Meeting, shareholders will
elect six Class I directors to serve until Merchants' 2002 annual meeting of
shareholders and until their successors are elected and qualified. All of the
nominees for Class I, directors are currently directors of Merchants. Messrs.
Gapinski, Bartels, Krawczyk, Rose, Donaj and Sass were elected at the 1996
annual meeting of shareholders of Merchants to serve until the 1999 Annual
Meeting.
The six nominees have consented to serve, if elected, and at the date of this
Proxy Statement, Merchants has no reason to believe that any of the named
nominees will be unable to serve. Unless otherwise directed, the persons named
as proxies intend to vote in favor of the election of the six nominees listed
below.
The information presented below as to principal occupation and shares of Common
Stock beneficially owned as of April 19, 1999, is based in part on information
received from the respective persons and in part on the records of Merchants.
<PAGE> 6
<TABLE>
<CAPTION>
NOMINEES FOR CLASS I DIRECTORS
(TERM EXPIRING IN 2002)
NAME, AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
--------- --------------------------------------
<S> <C>
Thomas Gapinski Insurance executive, director of Merchants from 1982 to 1986 and
Age: 64 from 1992 to present, director of Lincoln State Bank from 1977 to
present.
J. Michael Bartels President Bartels Management Services, Inc., Milwaukee, WI;
Age: 59 director of Merchants since 1995; director of Franklin State Bank
from 1982 to present.
John Krawczyk Executive Vice President and Chief Operating Officer of Merchants
Age: 43 since 1994; director of Merchants from 1993 to present; director of
Lincoln Community Bank since 1987.
Gervase Rose President Roman Electric Co., Milwaukee WI, director of Merchants
Age: 62 from 1992 to 1993 and from 1994 to present; director of Franklin
State Bank from 1982 to present.
Robert Donaj President of Achieve Mortgage Corporation, from 1997 to present;
Age: 55 Director of Lincoln Community Bank from 1987 to present; director of
Merchants 1993 to present.
James Sass President, Max A. Sass Funeral Home; director of Lincoln Community
Age: 56 Bank from 1987 to present; director of Merchants from 1993 to
present.
<CAPTION>
DIRECTORS CONTINUING IN OFFICE
CLASS II DIRECTORS (TERM EXPIRING IN 2000)
------------------------------------------
NAME, AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
--------- --------------------------------------
<S> <C>
Casimir S. Janiszewski President, Superior Die Set Corporation, Oak Creek, WI; director of
Age: 46 Merchants from 1995 to present, director of Franklin State Bank from
1982 to 1991, director of Lincoln State Bank from 1991 to present.
David Kaczynski President, Cardinal Fabricating Corporation, Milwaukee, WI; director
Age: 59 of Lincoln Community Bank from 1994 to present, director of
Merchants from 1994 to present.
Longin Prazynski Retired building inspector, director of Lincoln Community Bank from
Age: 69 1962 to present, director of Merchants since 1993.
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
CLASS III DIRECTORS (TERM EXPIRING IN 2001)
-------------------------------------------
NAME, AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
--------- --------------------------------------
<S> <C>
James Bomberg President of Merchants from 1994 to present, Chief Executive Officer
Age: 55 of Merchants since 1998, director and president of Lincoln State
Bank, from 1991 to 1993; director and president of M&M Services, from
1994 to 1996, director of Merchants from 1994 to present.
Michael J. Murry Chairman of the Board of Directors of Merchants since 1992; Chief
Age: 53 Executive Officer of Merchants from 1982 to 1998 and director of
Merchants since 1982, director of Lincoln State Bank since 1983,
director of Franklin State Bank, Franklin, Wisconsin, since 1992;
Director of Lincoln Community Bank, since 1994.
Conrad Kaminski Executive officer of Merchants since 1998, President of Lincoln
Age: 64 State Bank from 1994 to 1998; director of Lincoln State Bank from
1992 to present; President of Lincoln Community Bank from 1997 to
1998, director of Lincoln Community Bank since 1997, director of
Merchants from 1991 to present; president of Merchants from 1991 to
1993; executive vice president of Merchants from 1982 to 1991.
Nicholas Logarakis President, General Automotive Manufacturing Co., Inc. Franklin, WI;
Age: 58 director of Lincoln State Bank from 1977 to present; director of
Merchants from 1982 to present.
Keith Winters President, Keith C. Winters & Assoc. Ltd. Franklin, WI; director of
Age: 60 Franklin State Bank from 1982 to present; director of Merchants from
1989 to present.
Duane Cherek Auto dealer, Cherek Lincoln-Mercury, Greenfield, WI; director of
Age: 54 Lincoln Community Bank from 1987 to present; director of Merchants
since 1993, director of M&M Services from 1994 to present.
</TABLE>
Lincoln State Bank, Milwaukee, Lincoln Community Bank, Milwaukee, Franklin State
Bank, Franklin, Achieve Mortgage Corporation, Milwaukee, and M&M Services
Corporation, New Berlin are wholly owned subsidiaries of Merchants.
<PAGE> 8
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth, as of April 19, 1999, information concerning
beneficial ownership of Common Stock of Merchants for each nominee, continuing
director and executive officer.
<TABLE>
<CAPTION>
=============================================================================================================
TITLE OF NAME OF BENEFICIAL AMOUNT OF BENEFICIAL PERCENT OF
CLASS OWNER OWNERSHIP CLASS
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common J. Michael Bartels 19,987 1.34
- -------------------------------------------------------------------------------------------------------------
Common James Bomberg 22,448 1.51
- -------------------------------------------------------------------------------------------------------------
Common Duane Cherek 8,913 *
- -------------------------------------------------------------------------------------------------------------
Common Robert Donaj 8,250 *
- -------------------------------------------------------------------------------------------------------------
Common Thomas Gapinski 1,946 *
- -------------------------------------------------------------------------------------------------------------
Common Casimir S. Janiszewski 5,647 *
- -------------------------------------------------------------------------------------------------------------
Common David Kaczynski 3,035 *
- -------------------------------------------------------------------------------------------------------------
Common Conrad Kaminski 46,821 3.14
- -------------------------------------------------------------------------------------------------------------
Common John Krawczyk 22,894 1.54
- -------------------------------------------------------------------------------------------------------------
Common Nicholas Logarakis 15,352 1.00
- -------------------------------------------------------------------------------------------------------------
Common James Mroczkowski(1) 10,774 *
- -------------------------------------------------------------------------------------------------------------
Common Michael Murry 20,690 1.39
- -------------------------------------------------------------------------------------------------------------
Common Longin Prazynski 4,124 *
- -------------------------------------------------------------------------------------------------------------
Common Gervase Rose 4,330 *
- -------------------------------------------------------------------------------------------------------------
Common James Sass 10,247 *
- -------------------------------------------------------------------------------------------------------------
Common Keith Winters 18,117 1.22
- -------------------------------------------------------------------------------------------------------------
Directors and Executive 223,048 14.97
Officers(2)
=============================================================================================================
</TABLE>
* Less than 1%
(1) Vice President, Chief Financial Officer; not a director of Merchants
(2) Includes all of the above as a group (16 individuals).
Share ownership includes shares issuable within 60 days upon exercise of
incentive stock options owned by certain officers.
All shares reported herein are owned with voting and investment power vested in
those persons whose names are provided herein or their spouses. Some shares may
be owned in joint tenancy, by a spouse, or in the names of minor children.
<PAGE> 9
BOARD COMMITTEES AND MEETING ATTENDANCE
The Board of Directors held eight meetings during 1998. Each director attended
during his/her tenure 75% or more of the total number of meetings of the Board
of Directors and its committees of which they were members.
The Board of Directors of Merchants has the following committees:
EXECUTIVE PERSONNEL COMPENSATION COMMITTEE - See Compensation Committee
Report on Executive Compensation.
Compensation for non-executive officers and employees of Merchants and
its subsidiaries is determined by the management and directors of
Merchants and the respective subsidiary and reviewed by the
PERSONNEL/COMPENSATION COMMITTEE OF MERCHANTS. The
Personnel/Compensation Committee consists of directors of Merchants and
its subsidiary banks. Its members are Messrs. Logarakis, Sass, Rose,
Michael Duginski and Ms. Maria Cameron. The Personnel/Compensation
Committee held four meetings during 1998.
THE STOCK OPTION COMMITTEE is responsible for administering Merchants'
1996 Incentive Stock Option Plan. None of the members of the Stock
Option Committee is eligible to participate in the Stock Option Plan.
The Stock Option Committee consists of Messrs. Sass, Rose and
Logarakis. The Stock Option Committee held one meeting in 1998.
THE MARKETING/SERVICES COMMITTEE assists management in analyzing market
trends for the products of the subsidiary banks and in devising
strategies for promoting, advertising and selling the services of the
subsidiary banks. The Marketing Committee consists of directors of
Merchants and the subsidiary banks. The present members are Messrs.
Michael Dunham, John Klose, Cherek and Sass. The Marketing Committee
met four times during 1998.
THE ASSET/LIABILITY MANAGEMENT COMMITTEE monitors the interest rate
risk of the interest-earning assets of the subsidiary banks in
comparison to their interest-bearing liabilities. The Asset/Liability
Management Committee consists of directors of Merchants and its
subsidiary banks. Its members are Messrs. Winters, Casimir Janiszewski,
Michael Dana, William LaMacchia and Ms. Cameron. The Asset/Liability
Management Committee met four times during 1998.
THE AUDIT/OPERATIONS COMMITTEE reviews budget and auditing matters,
internal control procedures and audit and regulatory reports. The
Audit/Operations Committee consists of directors of Merchants and its
subsidiary banks. Its members are Messrs. Gapinski, Bartels, Gary
Krawczyk, Cherek, Francisco Aguilar, Kaczynski, and Sister Mary
Jendras. The Audit/Operations Committee met four times during 1998.
<PAGE> 10
THE COMPLIANCE COMMITTEE oversees the establishment of policies and
procedures and adherence to such policies and procedures to ensure
compliance by Merchants and its subsidiaries with laws, rules and
regulations applicable to banks and bank holding companies. The
Compliance Committee consists of directors of Merchants and its
subsidiary banks. Its members are Sister Jendras and Messrs. Bartels
and Prazynski. The Compliance Committee met four times during 1998.
THE TECHNOLOGY COMMITTEE was formed in 1998. The purpose of the
committee is to establish framework within which Merchants will meet
the challenges of the new millennium, by providing quality products and
services to its varied constituencies in a cost efficient manner, along
with ensuring that the internal technological architecture of Merchants
meets industry state of the art standards wherever possible. Its
members are Messrs. Bartels, Casimir Janiszewski, Frank Janiszewski and
Dunham. The Technology Committee met two times during 1998.
The Board of Directors does not have a standing Nominating Committee.
DIRECTOR COMPENSATION
Directors of Merchants who are not employees of Merchants or any of its
subsidiaries are paid a fee of $50 for each Board of Directors meeting and $200
for each committee meeting. Fees are only paid for actual attendance at such
meetings.
CERTAIN TRANSACTIONS AND REPORTS
Various officers and directors of Merchants and its subsidiaries, members of
their families, and the companies or firms with which they are associated were
customers of, and had banking transactions, including loans, with one or more of
Merchants' subsidiary banks in the ordinary course of each such bank's business
during 1998. All such loans were made on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable
transactions with other persons and, in the opinion of the management of
Merchants' subsidiary banks, did not involve more than a normal risk of
collectibility or present other unfavorable features.
Keith C. Winters and Associates, LTD, a business interest of director Winters,
lease office space from Merchants. The lease terms are substantially the same as
those offered to other tenants.
Michael Duginski, director of Lincoln State Bank, and Gary Krawczyk, a director
of Franklin State Bank, are principals of the Krawczyk and Duginski, S.C. law
firm that performs legal services for Merchants and its subsidiaries. Krawczyk
and Duginski lease office space in the Merchants corporate headquarters at terms
substantially the same as those offered to other tenants.
Dana Investment Advisors, Inc., a registered investment advisor under the
Investment Advisor's Act of 1940, acts as an investment advisor to subsidiaries
of Merchants. Michael Dana, President of Dana Investment Advisors, Inc., is a
director of Lincoln State Bank. The advisory services are rendered on
substantially the same terms and conditions as those prevailing for similar
services in the relevant market.
<PAGE> 11
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under Section 16(a) of the Securities Exchange Act of 1934, Merchants' directors
and executive officers, as well as certain persons holding more than 10% of
Merchants' stock, are required to report their initial ownership of stock and
subsequent changes in such ownership to the Securities and Exchange Commission
and Merchants (such requirements herein after referred to as "Section 16(a)
filing requirements"). Specific time deadlines for the Section 16(a) filing
requirements have been established.
To Merchants' knowledge, and based solely upon a review of the copies of such
reports furnished to Merchants, with respect to the fiscal year ended December
31, 1998, Merchants directors and executive officers complied with the
applicable Section 16(a) filing requirements.
EXECUTIVE COMPENSATION
The following table sets forth information concerning compensation paid or
accrued for services rendered in all capacities to Merchants and its affiliates
for the fiscal years ended December 31, 1998, 1997 and 1996 of the person who
was, on December 31, 1998, the Chief Executive Officer of Merchants and of the
four highest paid persons whose annual compensation exceeded $100,000 in 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
=================================================================================================================
Long-TermCompensation
Annual Compensation Awards
=================================================================================================================
Securities
Name and Other Annual Underlying All Other
Principal Position Year Salary Bonus Compensation Options/SARs(#) Compensation
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
James Bomberg 1998 $149,723 $18,000 --- --- $ 6,589 (1)
President and Chief 1997 $117,938 $15,000 --- --- $ 5,206 (1)
Executive Officer of 1996 $ 97,149 $14,335 --- --- $ 4,329 (1)
Merchants
- -----------------------------------------------------------------------------------------------------------------
Michael Murry 1998 $125,232 $50,000 --- --- $ 9,356 (2)
Chairman of the Board 1997 $171,766 $80,000 --- --- $12,397 (3)
of Directors of 1996 $204,907 $85,000 --- --- $13,527 (4)
Merchants
- -----------------------------------------------------------------------------------------------------------------
Robert Blonski 1998 $119,689 $18,000 --- --- $ 5,508 (1)
President and Chief 1997 $117,182 $15,000 --- --- $ 5,017 (1)
Executive Officer of 1996 $117,432 $14,335 --- --- $ 5,271 (1)
M&M Services
- -----------------------------------------------------------------------------------------------------------------
Conrad Kaminski 1998 $132,408 $18,000 --- --- $ 5,906 (1)
President of 1997 $121,217 $15,000 --- --- $ 5,346 (1)
Merchants Milwaukee 1996 $106,884 $14,335 --- --- $ 4,732 (1)
Division
- -----------------------------------------------------------------------------------------------------------------
John Krawczyk 1998 $ 95,631 $13,147 --- --- $ 4,266 (1)
Executive Vice 1997 $ 87,405 $11,939 --- --- $ 3,974 (1)
President and Chief 1996 $ 81,087 $10,823 --- --- $ 3,676 (1)
Operations Officer of
Merchants
=================================================================================================================
</TABLE>
(1) Contributions to the Corporation's Defined Contribution 401(k) Plan
(2) Contributions to the Corporation's Defined Contribution 401(k) Plan
of $6,800 and life insurance policy premium of $2,556.
<PAGE> 12
(3) Contributions to the Corporation's Defined Contribution 401(k) Plan
of $9,938 and life insurance policy premium of $2,459.
(4) Contributions to the Corporation's Defined Contribution 401(k) Plan
of $11,080 and life insurance policy premium of $2,447.
EMPLOYMENT AGREEMENTS
In February of 1996, Merchants entered into employment agreements with Messrs.
Murry, Bomberg, Kaminski, John Krawczyk and James Mroczkowski. At the same time,
M&M Services, Inc., a wholly-owned subsidiary of Merchants, entered into
employment agreements with Messrs. Blonski and Stengel, and Achieve Mortgage, a
wholly-owned subsidiary of Merchants, entered into an employment agreement with
Mr. Donaj (the "Employment Agreements"). Messrs. Murry, Bomberg, Kaminski,
Krawczyk and Mroczkowski serve as chairman of the board of directors, president
and chief executive officer, president Milwaukee division, executive vice
president and chief operating officer and vice president and chief financial
officer, respectively, of Merchants. Messrs. Blonski and Stengel are president
and chief executive officer and senior vice president and comptroller,
respectively, of M&M Services. Mr. Donaj serves as president and chief executive
officer, of Achieve Mortgage.
With the exception of the Employment Agreements with Messrs. Murry and
Mroczkowski, all of the Employment Agreements replace previous employment
agreements with the respective officers.
Except for the Employment Agreement with Mr. Murry, all of the Employment
Agreements have terms of three years. Mr. Murry's Employment Agreement has a
term of five years. Each Employment Agreement is automatically extended on its
anniversary date for an additional year, unless either party has given advance
notice that the Agreement will not be extended, in which case the Agreement
expires at the end of its then-remaining term.
Duties to be performed under the Agreements are set forth in the respective
By-Laws and are determined by the respective Board of Directors.
Compensation for services rendered under the Employment Agreements consists of
the Base Salary, as defined in the Agreements, and participation in bonus and
other benefit plans.
If the Agreements are terminated by the employer prior to their expiration for
reasons other than the employee's death, retirement, disability, or other than
for cause as defined in the Agreements, or if the employee terminates the
Agreement for cause as defined in the Agreement or after a change in control, as
defined in the Agreements, then the employee will receive severance payments
equal to the sum of the Base Salary in effect at termination plus the cash
bonus, if any, for the year prior to termination times the number of years of
the remaining employment term. In addition, the employee will receive fringe
benefits during such remaining term.
If termination occurs because of death, retirement or for cause, or if the
employee terminates without cause, then the employer is obligated to pay the
compensation and benefits only through the date of termination.
If termination occurs due to disability, as defined in the Employment
Agreements, the employee will be entitled to payment of his Base Salary at 100%
for one year and at 75% for the remaining portion of the employment term,
adjusted by payments received by the employee pursuant to disability insurance
and social security and workers compensation programs.
<PAGE> 13
The Employment Agreements provide that during the employment period and for one
year thereafter, the employee will not accept employment with any Significant
Competitor, as that term is defined in the Employment Agreements, of the
Corporation or its affiliates.
THE 1996 INCENTIVE STOCK OPTION PLAN
On April 25, 1996, the Board of Directors of Merchants adopted the Merchants and
Manufacturers Bancorporation, Inc. 1996 Incentive Stock Option Plan (the "Plan")
which was approved by the shareholders on May 28, 1996.
The Plan replaced the 1986 Incentive Stock Option Plan, which terminated in
April 1996. The purpose of the Plan is to advance the interests of Merchants and
its subsidiaries by encouraging and providing for the acquisition of an equity
interest in Merchants by key employees and by enabling Merchants and its
subsidiaries to attract and retain the services of employees upon whose skills
and efforts the success of Merchants depends.
The following summary description of the Plan is qualified in its entirety by
reference to the full text of the Plan a copy of which may be obtained from
Merchants upon request to John Krawczyk, Secretary, 14100 West National Avenue,
P.O. Box 511160, New Berlin, WI 53151.
The Plan is administered by the Stock Option Committee of the Board or by any
other committee appointed by the Board consisting of not less than three (3)
directors (the "Committee"). The Committee is comprised of directors who are
disinterested persons within the meaning of Rule 16b-3 as promulgated by the
Securities and Exchange Commission. Subject to the terms of the Plan and
applicable law, the Committee has the authority to: establish rules for the
administration of the Plan; select the individuals to whom options are granted;
determine the numbers of shares of Common Stock to be covered by such options;
and take any other action it deems necessary for the administration of the Plan.
Participants in the Plan consist of the individuals selected by the Committee.
Those selected individuals may include any executive officer or employee of
Merchants or its subsidiaries who, in the opinion of the Committee, contribute
to Merchants' growth and development.
Subject to adjustment for dividends or other distributions, recapitalizations,
stock splits or similar corporate transactions or events, the total number of
shares of Common Stock with respect to which options may be granted pursuant to
the Plan is 60,000. The shares of Common Stock to be delivered under the Plan
may consist of authorized but unissued stock or treasury stock.
Options may be granted by the Committee to key employees as determined by the
Committee. The Committee has complete discretion in determining the number of
options granted to each such grantee. It is intended that all options granted
under the Plan will qualify as incentive stock options within the meaning of
Section 422 of the Internal Revenue Code.
The exercise price for all options granted pursuant to the Plan is the fair
market value of the Common Stock on the date of grant of the option; however, in
case of options granted to a person then owning more than 10% of the outstanding
Common Stock, the option price will be not less than 110% of the fair market
value on such date. The exercise price must be paid in cash at the time of
exercise of the options.
<PAGE> 14
Options granted under the Plan must be exercised within ten (10) years from the
date of grant, provided that options granted to a person then owning more than
10% of the outstanding stock of Merchants must be exercised before the fifth
anniversary of the date of grant. Options not exercised within the stated time
period will expire.
The Committee may impose such transfer restrictions on the shares of Common
Stock acquired pursuant to the exercise of options under the Plan as may be
required, among others, by applicable federal or state securities laws.
Merchants has a "right of first refusal" pursuant to which any shares of Common
Stock acquired by exercising an option must first be offered to Merchants before
they may be sold to a third party. Merchants may then purchase the offered
shares on the same terms and conditions (including price) as apply to the
potential third-party purchaser.
The Board of Directors of Merchants may terminate, amend or modify the Plan at
any time, provided that no such action of the Board, without prior approval of
the shareholders may: increase the number of shares which may be issued under
the Plan; materially increase the cost of the Plan or increase benefits to
participants or change the class of individuals eligible to receive options.
The following is a summary of the principal federal income tax consequences
generally applicable to awards under the Plan. The grant of an option is not
expected to result in any taxable income for the recipient. The holder of an
Incentive Stock Option generally will have no taxable income upon exercising the
Incentive Stock Option (except that a liability may arise pursuant to the
alternative minimum tax), and Merchants will not be entitled to a tax deduction
when an Incentive Stock Option is exercised. The tax consequences to an optionee
upon disposition of shares acquired through the exercise of an option will
depend on how long the shares have been held and upon whether such shares were
acquired by exercising an Incentive Stock Option which qualifies as such under
the Internal Revenue Code. Generally, there will be no tax consequences to
Merchants in connection with the disposition of shares acquired under an option.
The following table presents information about stock options granted in 1998 to
the officers named in the Summary Compensation Table.
STOCK OPTION GRANTS IN 1998
<TABLE>
<CAPTION>
===========================================================================================================
Options % of Total Options Exercise Expiration
Name Granted Granted in Fiscal Year Price Date
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michael Murry 11,000 22.10% $31.14 7/31/08
- -----------------------------------------------------------------------------------------------------------
Robert Blonski 2,475 4.97% $30.91 4/30/08
- -----------------------------------------------------------------------------------------------------------
Conrad Kaminski 3,300 6.63% $30.91 4/30/08
- -----------------------------------------------------------------------------------------------------------
James Bomberg 4,950 9.94% $30.91 4/30/08
- -----------------------------------------------------------------------------------------------------------
John Krawczyk 3,300 6.63% $30.91 4/30/08
===========================================================================================================
</TABLE>
The following table summarizes for each of the officers named in the Summary
Compensation Table the number of shares of Merchants stock acquired upon
exercise of options during the fiscal year ended December 31, 1998; the
aggregate dollar value realized upon exercise of options; the total number of
unexercised options held at the end of the fiscal year ended December 31, 1998;
and the aggregate dollar value of in-the-money unexercised options held at the
end of the fiscal year ended December 31, 1998. Value realized upon exercise is
the difference between fair market value of the underlying stock on the
<PAGE> 15
exercise date and the exercise price of the option. Value of unexercised
in-the-money options at the fiscal year-end is the difference between exercise
price and the fair market value of the underlying stock on December 31, 1998,
which was $39.50 per share. These values, unlike any amount which may be set
forth in the column headed "Value Realized" have not been, and may never be,
realized. The underlying options have not been, and may never be, exercised; the
actual gains, if any, on exercise will depend on the value of Merchants' stock
on the date of exercise. As of December 31, 1998, all unexercised options were
exercisable.
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1998
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
=============================================================================================================
Number of Value of Unexercised
Shares Acquired Value Unexercised Options In-the-Money Options
on Exercise Realized on December 31, 1998 On December 31, 1998
Name (#) $ (#) ($)
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michael Murry 2,250 $47,025 11,000 $ 91,960
- -------------------------------------------------------------------------------------------------------------
Robert Blonski --- --- 2,475 $ 21,260
- -------------------------------------------------------------------------------------------------------------
Conrad Kaminski --- --- 6,600 $117,967
- -------------------------------------------------------------------------------------------------------------
James Bomberg --- --- 6,000 $ 87,606
- -------------------------------------------------------------------------------------------------------------
John Krawczyk --- --- 8,250 $158,872
=============================================================================================================
</TABLE>
BENEFIT PLANS
Merchants maintains a 401k Profit Sharing Plan for the benefit of all employees
who have attained the age of 20-1/2 years and have completed six months of
service as of the 401k Profit Sharing Plan anniversary date, June 1st. A
participating employee may elect to defer a portion of his or her compensation
(between 1% and 12% of base compensation, subject to certain limitations, in 1%
increments) and contribute this amount to the 401k Profit Sharing Plan.
Deferrals of up to 6% of compensation which are contributed to a trust set up
pursuant to the 401k Profit Sharing Plan may be deducted by Merchants for
federal income tax purposes. Merchants may make either or both of the following
types of contributions out of its net profits to the 401k Profit Sharing Plan
(I) matching contributions up to 1% of base compensation; (ii) discretionary
contributions which are based on consolidated earnings of Merchants. Employees
of Merchants are fully vested in all amounts contributed to their account under
matching and discretionary contributions made by Merchants. Total contributions
amounted to $193,187 in 1998, contributions for Messrs. Murry, Blonski,
Kaminski, Bomberg and Krawczyk (the persons listed in the Compensation Table)
were $6,800, $5,508, $5,906, $6,589 and $4,266 respectively. With respect to the
investment of individual accounts, a participant may direct the Trustee in
writing to invest the vested portion of his/her account in specific assets,
including Merchants' securities.
Merchants has established a Salary Continuation Plan to provide retirement
income for President James Bomberg, Chief Financial Officer James Mroczkowski
and Lincoln State Bank President Cynthia Loew. The Salary Continuation Plan is a
non-qualified executive benefit plan in which Merchants agrees to pay the
executive additional benefits at retirement in return for continued satisfactory
performance. The Merchants Continuation Agreement provides for annual retirement
benefits of $60,700 for Mr. Bomberg, $35,800 for Mr. Mroczkowski and $30,700 for
Ms. Loew, commencing at age 65 and continuing for a period of 15 years. The
Salary Continuation Plan is unfunded (no specific assets are set aside by
Merchants in connection with the Plan). If the covered executive leaves the
bank's employ, either
<PAGE> 16
voluntarily or involuntarily, the agreement under the Salary Continuation Plan
terminates and the executive receives no benefits unless obligations under the
Plan are assumed by a subsidiary of Merchants, because of the executive's
employment status with such subsidiary. The Salary Continuation Plan is
informally linked with a single premium universal life insurance policy. The
executive is the insured under the policy, but Merchants is the owner and
beneficiary of the policy. The executive has no claim on the insurance policy,
its cash value or the proceeds thereof.
Franklin State Bank has adopted a Deferred Compensation Plan. Directors of
Franklin State Bank may elect to defer the directors' fees paid to them until
retirement with no income tax payable by the director until retirement benefits
are received. The deferral agreement provides for full vesting since the covered
director is setting aside his current compensation. Payments begin in the first
year following retirement.
COMPENSATION COMMITTEE REPORT ON
EXECUTIVE COMPENSATION
THE COMMITTEE
The Executive Personnel/Compensation Committee meets periodically to review the
performance and compensation of certain senior officers of Merchants and its
subsidiaries, including all executive officers of Merchants. The Executive
Personnel/Compensation Committee is comprised of Messrs. James Sass, Gervase
Rose, and Nicholas Logarakis. No member of the Committee is an employee or
officer of the Corporation or its subsidiaries. The committee is aware of the
limitations imposed by Section 162(m) of the Internal Revenue Code of 1986, as
amended, on the deductibility of compensation paid to certain senior executives
to the extent it exceeds $1.0 million per executive. The Committee's recommended
compensation amounts meet the requirements for deductibility. The Executive
Personnel/Compensation Committee held one meeting during 1998.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Corporations of which Messrs. Sass, Rose and Logarakis are executive officers
had loans with subsidiary banks of Merchants. See "Election of Directors -
Certain Transactions." There are no other interlocking relationships as defined
by the Securities and Exchange Commission, and no Merchants officer is a member
of the Committee.
GENERAL POLICY
The compensation objective of Merchants and its subsidiaries is to link
compensation with corporate and individual performance in a manner which will
attract and retain competent personnel with leadership qualities. The process
gives recognition to the compensation practices of competing organizations.
In an effort to achieve the long-term goals of shareholders, the compensation
program ties a significant portion of total compensation to the financial
performance of the Corporation compared to peer group performance. The Executive
Personnel/Compensation Committee makes recommendations on the compensation of
the Corporation's officers to the Board of Directors. The Compensation
Committee's recommendations reflect its assessment of the contributions to the
long-term profitability and financial performance made by individual officers.
In this connection, the Committee considers, among other things, the type of the
officer's responsibilities, the officer's long-term performance and tenure,
compensation relative to peer group and the officer's role in ensuring the
future financial success of the
<PAGE> 17
Corporation. Financial goals considered by the Committee include earnings per
share, return on assets, return on equity, asset quality, growth and expense
control.
In addition to measuring performance in light of these financial factors, the
Committee considers the subjective judgment of the Chairman of the Board in
evaluating performance and establishing salary, bonus, and long-term incentive
compensation for individual officers, other than the Chairman. The Committee
independently evaluates the performance of the Chairman, taking into
consideration such subjective factors as leadership, innovation and
entrepreneurship in addition to the described financial goals.
BASE SALARY
In determining officer salaries, the Committee considers surveys and data
regarding compensation practices of similar sized financial institutions with
comparable products in similar markets. The Committee also considers the
Chairman's assessment of the performance, the nature of the position and the
contribution and experience of individual officers (other than the Chairman of
the Board). The Committee independently evaluates the Chairman's performance and
compares his compensation to peer group data.
ANNUAL BONUSES
Officers of the Corporation and its subsidiaries are awarded annual bonuses in
January based on the previous year's financial performance at the discretion of
the Committee. The amount of the bonus is recommended to the Committee by the
Chairman, based on his and the officer's immediate supervisor's evaluation of
the achievement of corporate and individual goals and assessment of subjective
factors such as leadership, innovation and commitment to corporate advancement.
The Corporation annual incentive bonus is based on the overall consolidated
financial performance of the Corporation.
CHAIRMAN OF THE BOARD COMPENSATION
The compensation of the Chairman was established at a level which the Committee
believed would approximate compensation of the Chairmen with comparable
responsibilities of similar organizations and would reflect prevailing market
conditions. The Committee took into consideration a variety of factors,
including the achievement of corporate financial goals and individual goals. The
financial goals included increased earnings, return on assets, return on equity
and asset quality. No formula assigning weights to particular goals was used,
and achievement of other corporate performance goals was considered in general.
The Committee believes that the total compensation awarded to the Chairman of
the Board for 1998 is fair and appropriate under the circumstances.
In 1998 the Chairman of the Board reduced his participation in the Corporation's
day to day activities. He remains as the Corporation's chief commercial lender,
new business developer, and strategic planner. The Chairman's 1998 salary was
decreased to reflect the reduced time spent and the delegation of certain duties
to the Chief Executive Officer and other executive officers.
STOCK OPTIONS
The Committee administers the 1996 Incentive Stock Option Plan. Stock options
are designed to furnish long-term incentives to the officers of the Corporation
to build shareholder value and to provide a link between officer compensation
and shareholder interest. The Committee made awards under the Stock
<PAGE> 18
Option Plan to the officers of the Corporation and its subsidiaries in 1998.
Awards were based upon performance, responsibilities and the officer's relative
position and ability to contribute to future performance of the Corporation. In
determining the size of the option grants, the Committee considered information
and evaluations provided by the Chairman of the Board. The award of option
grants to the Chairman is based on the overall performance of the Corporation
and on the Committee's assessment of the Chairman's contribution to the
performance and his leadership.
The Executive Personnel Compensation Committee: Nicholas Logarakis, Gervase
Rose, James Sass
SHAREHOLDER RETURN AND PERFORMANCE PRESENTATION
STOCK PRICE PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly change in the cumulative
total shareholder return (change in year-end stock price plus reinvested
dividends) on Merchants' Common Stock with the cumulative total return of the
Nasdaq Bank Index and the S&P 500 for the period of five fiscal years commencing
on December 31, 1993, and ending December 31, 1998. The Nasdaq Bank Index is
prepared for Nasdaq by the center for Research in Securities Prices at the
University of Chicago. The graph assumes that the value of the investment in
Merchants stock and for each index was $100 on December 31, 1993.
[GRAPH]
<TABLE>
<CAPTION>
----------------------------------------------------------
12/31/93 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
- -------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Merchants 100.00 106.32 115.52 134.28 215.24 303.76
- -------------------------------------------------------------------------
Nasdaq Bank 100.00 99.64 148.38 195.91 328.02 324.90
- -------------------------------------------------------------------------
S&P 500 100.00 101.23 139.28 171.23 228.34 293.60
- -------------------------------------------------------------------------
</TABLE>
Historical stock price performance shown on the graph is not necessarily
indicative of the future price performance.
<PAGE> 19
PROPOSAL 2
PROPOSAL TO AMEND MERCHANTS' ARTICLES OF
INCORPORATION TO INCREASE AUTHORIZED COMMON STOCK.
DESCRIPTION OF AMENDMENT:
The Merchants' Board of Directors unanimously approved and recommended that
Merchants' shareholders approve an amendment to Article IV of the Articles which
will increase the number of authorized shares of Common Stock of Merchants from
3,000,000 shares to 6,000,000 shares. If the proposal is adopted by Merchants'
shareholders, it is expected that the amendment will become effective on May 25,
1999, or as soon as practicable thereafter. No holder of the Common Stock of
Merchants has any preemptive rights. The complete text of the amendment is
attached to this Proxy Statement as Exhibit A.
Under the current Articles, Merchants is authorized to issue up to 3,000,000
shares of Common Stock, par value $1.00. As of April 19, 1999, 1,489,754 shares
were outstanding. If the amendment is adopted, Merchants would be authorized to
issue up to 6,000,000 shares of Common Stock, par value $1.00.
REASONS FOR AND EFFECT OF AMENDMENT:
The Board of Directors believes that it is desirable to have additional
authorized shares of Common Stock available for stock dividends and splits,
possible acquisitions and other general corporate purposes. As previously
announced, Merchants has entered into a merger agreement pursuant to which
additional shares of Common Stock would be issued, if the transaction is
consummated. While Merchants cannot predict when and if stock dividends or stock
splits or acquisitions will occur, having the additional authorized shares
available for issuance in the future will provide greater flexibility and will
avoid the delay and expense of a special shareholders meeting, unless such
meeting is required by applicable law.
The increase in the number of authorized shares is not designed to deter or
prevent a change in control; however, under certain circumstances, Merchants
could use additional shares to avoid a takeover or change in control of
Merchants which the Board of Directors deems not to be in the best interest of
the Shareholders of Merchants. Merchants is not aware of any attempt to effect
such a takeover or change in control. With the exception of the aforementioned
merger, as of this date there are no plans or commitments with respect to the
issuance of additional shares of Common Stock of Merchants.
The authorization of additional shares of Common Stock pursuant to this proposal
will have no dilutive effect upon proportionate voting power of present
shareholders of Merchants. However, to the extent that shares are subsequently
issued to persons other than present shareholders and/or in proportions other
than the proportion that presently exists, such issuance could have a dilutive
effect on present shareholders.
If a quorum exists, the proposed amendment to the Articles of Incorporation is
approved if the votes cast favoring the amendment exceed the votes opposing the
amendment. A majority of the votes entitled to be cast on the amendment
constitutes a quorum. The Board of Directors recommends that the shareholders
vote FOR the amendment. Proxies solicited by the Board of Directors will be so
voted unless shareholders specify to the contrary in their proxies or abstain
from voting on this matter. The complete text of the proposed amendment is
attached to this proxy statement as Exhibit A.
<PAGE> 20
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Ernst & Young LLP as Merchants' independent
auditors for the fiscal year ending December 31, 1999. Representatives of Ernst
& Young will be present at the Annual Meeting to make any statement they may
desire and to respond to questions from shareholders.
OTHER MATTERS
Although management is not aware of any other matters that may come before the
meeting, if any such matters should be presented, the persons named in the
accompanying proxy intend to vote such proxy in accordance with their best
judgment.
SHAREHOLDERS MAY OBTAIN A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AT NO COST BY WRITING TO THE
OFFICE OF THE SECRETARY, MERCHANTS AND MANUFACTURERS BANCORPORATION, INC., 14100
WEST NATIONAL AVENUE, P.O.BOX 511160, NEW BERLIN, WISCONSIN, 53151.
By Order of the Board of Directors,
By: /s/ Michael J. Murry
-----------------------------------
Michael J. Murry
Chairman of the Board
May 5, 1999
<PAGE> 21
EXHIBIT A
RESOLVED, that the Articles of Incorporation of Merchants and
Manufacturers Bancorporation, Inc. be amended by striking out amended
Article IV, relating to Capital, reading as follows:
"The aggregate number of shares of stock which this Corporation
shall have authority to issue shall be three million (3,000,000)
shares of Common Stock of the par value of One Dollar ($1.00) per
share."
and inserting in lieu thereof the following:
"The aggregate number of shares of stock which this Corporation
shall have authority to issue shall be six million (6,000,000)
shares of Common Stock of the par value of One Dollar ($1.00) per
share."
<PAGE> 22
MERCHANTS AND MANUFACTURERS BANCORPORATION, INC.
14100 WEST NATIONAL AVENUE
NEW BERLIN, WISCONSIN
PROXY FOR ANNUAL MEETING
This Proxy is solicited by the Board of Directors of Merchants and Manufacturers
Bancorporation, Inc. ("Merchants") for the Annual Meeting of shareholders on May
25, 1999.
The undersigned hereby constitutes and appoints Keith Winters and Casimir
Janiszewski, and each of them, with full power to act alone and with power of
substitution, to be the true and lawful attorney and proxy of the undersigned to
vote at the Annual Meeting of Shareholders of Merchants, to be held at Alverno
College, 3401 South 39th Street, Milwaukee, Wisconsin 53215 on May 25, 1999 at
4:00 p.m. (or at any adjournment(s) thereof), the shares of stock which the
undersigned would be entitled to vote on the election of Directors and the
proposal to amend the Articles of Incorporation and in their discretion on such
other business as may properly come before the meeting or adjournment(s). The
undersigned hereby revokes any proxy heretofore given and ratifies all that said
attorneys and proxies or their substitutes may do by virtue hereof.
1. ELECTION OF DIRECTORS
To elect the six persons listed below as Class I Directors as discussed in
the Proxy Statement dated May 5, 1999 attached hereto.
Thomas Gapinski Gervase Rose
J. Michael Bartels Robert Donaj
John Krawczyk James Sass
[ ] Elect as Directors the six nominees listed above.
[ ] Withhold authority to vote for the six nominees listed above.
[ ] Withhold authority to vote for individual nominees (to
withhold authority to vote for any individual nominee, check
this box and draw a line through that nominee's name above).
2. ADOPTION OF RESOLUTION AMENDING THE CORPORATION'S ARTICLES OF
INCORPORATION
Adoption of the resolution amending the Corporation's Articles of
Incorporation to increase the number of authorized shares of $1.00 par
value common stock from 3,000,000 to 6,000,000 shares.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
<PAGE> 23
The Board of Directors recommends a vote FOR the election of the six persons
listed above, and FOR adoption of Proposal 2, as described in the Proxy
Statement.
If any additional matters are properly presented, the persons named in the proxy
will have the discretion to vote in accordance with their own judgment in such
matters. This proxy is solicited on behalf of the Board of Directors and may be
revoked prior to its exercise by written notice to the Secretary of the
Corporation, or by submitting a later-dated proxy, or by attending the annual
meeting. This Proxy will be voted in accordance with instructions given by the
stockholder, but if no instructions are given, this Proxy will be voted to elect
the persons listed above and FOR adoption of the listed proposal.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting
dated May 5, 1999, and the Proxy Statement enclosed herewith.
Dated , 1999
--------------------------------
Number of Shares:
-----------------
- --------------------------------- ----------------------------------
Signature of Stockholder Stockholder's Name (Please print)
- --------------------------------- ----------------------------------
Signature of Stockholder Stockholder's Name (Please print)
(Please sign your name exactly as it appears on the stock
certificate. In signing as Executor, Administrator, Personal
Representative, Guardian, Trustee, or Attorney, please add your title
as such. All joint owners should sign.)
