SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
[ X ] Filed by the registrant
[ ] Filed by a party other than the registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
Fidelity Bancorp, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
<PAGE>
[FIDELITY BANCORP, INC. LETTERHEAD]
January 8, 1999
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders
(the "Annual Meeting") of Fidelity Bancorp, Inc. The Annual Meeting will be held
at the Perrysville Branch of Fidelity Bank, PaSB, 1009 Perry Highway,
Pittsburgh, Pennsylvania on Tuesday, February 2, 1999, at 5:00 p.m., Eastern
Time. The matters to be considered by stockholders at the Annual Meeting are
described in detail in the accompanying materials.
It is very important that you be represented at the Annual Meeting
regardless of the number of shares you own or whether you are able to attend in
person. We urge you to mark, sign and date your proxy card today and return it
in the envelope provided, even if you plan to attend the Annual Meeting. This
will not prevent you from voting in person, but it will ensure that your vote is
counted if you are unable to attend.
Your continued interest in Fidelity Bancorp, Inc. is sincerely
appreciated.
Very truly yours,
/s/William L. Windisch
----------------------
William L. Windisch
President
<PAGE>
FIDELITY BANCORP, INC.
1009 PERRY HIGHWAY
PITTSBURGH, PENNSYLVANIA 15237
412-367-3300
NOTICE OF ANNUAL MEETING
TO BE HELD ON FEBRUARY 2, 1999
The Annual Meeting of Stockholders (the "Annual Meeting") of Fidelity
Bancorp, Inc. (the "Company") will be held at 1009 Perry Highway, Pittsburgh,
Pennsylvania on Tuesday, February 2, 1999, at 5:00 p.m., Eastern Time, for the
following purposes, all of which are more completely set forth in the
accompanying proxy statement:
(1) The election of three directors of the Company;
(2) To ratify the appointment of KPMG Peat Marwick LLP as the
Company's independent auditors for the fiscal year ending
September 30, 1999; and
(3) Such other matters as may properly come before the Annual
Meeting or any adjournments thereof.
The Board of Directors is not aware of any other business to come
before the Annual Meeting. Any action may be taken on any one of the foregoing
proposals at the Annual Meeting on the date specified above or on any date or
dates to which, by original or later adjournment, the Annual Meeting may be
adjourned.
Stockholders of record of the Company at the close of business on
December 22, 1998 are entitled to notice of and to vote at the Annual Meeting
and at any adjournment thereof.
You are requested to complete and sign the enclosed form of proxy which
is solicited by the Board of Directors and to mail it promptly in the enclosed
envelope. The proxy will not be used if you attend and vote at the Annual
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/Susan J. Lowe,
-----------------
Susan J. Lowe
Secretary
Pittsburgh, Pennsylvania
January 8, 1999
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THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF FURTHER
REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. A SELF- ADDRESSED ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES.
- --------------------------------------------------------------------------------
<PAGE>
FIDELITY BANCORP, INC.
1009 PERRY HIGHWAY
PITTSBURGH, PENNSYLVANIA 15237
(412) 367-3300
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 2, 1999
GENERAL
This Proxy Statement is furnished to the holders of the common stock of
Fidelity Bancorp, Inc. (the "Company"), the bank holding company of Fidelity
Bank, PaSB, Pittsburgh, Pennsylvania (the "Bank"), in connection with the
solicitation of proxies by the board of directors of the Company for use at the
Annual Meeting of Stockholders ("Annual Meeting") to be held at 1009 Perry
Highway, Pittsburgh, Pennsylvania on Tuesday, February 2, 1999, at 5:00 p.m.,
Eastern Time, and at any adjournment thereof for the purposes set forth in the
Notice of Annual Meeting. The Company is the sole stockholder of the Bank. This
Proxy Statement is expected to be mailed to stockholders on or about January 8,
1999.
VOTING SECURITIES AND
REVOCABILITY OF PROXIES
Only stockholders of record of the Company at the close of business on
December 22, 1998 ("Voting Record Date") are entitled to notice of and to vote
at the Annual Meeting and at any adjournment thereof. On the Voting Record Date,
there were 1,980,590 shares of common stock, par value $.01 per share (the
"Common Stock"), of the Company issued and outstanding, and the Company has no
other class of equity securities outstanding. Each share of Common Stock is
entitled to one vote at the Annual Meeting on all matters properly presented at
the Annual Meeting and does not vote cumulatively in the election of directors.
At the Annual Meeting, stockholders will consider and vote upon (i) the
election of three directors and (ii) to ratify the appointment of KPMG Peat
Marwick LLP as the Company's independent auditors for the fiscal year ending
September 30, 1999. The board of directors of the Company (the "Board" or the
"Board of Directors") knows of no additional matters that will be presented for
consideration at the Annual Meeting.
As to other matters that may properly come before the Annual Meeting,
unless otherwise provided in the Articles of Incorporation or Bylaws of the
Company or by statute, a majority of these votes cast by shareholders shall be
sufficient to pass on a matter.
Each proxy solicited hereby, if properly signed and returned to the
Company and not revoked prior to its use, will be voted in accordance with the
instructions contained therein. If no contrary instructions are given, each
proxy received will be voted (i) for the election of each nominee for director
described herein; (ii) for the ratification of the appointment of KPMG Peat
Marwick LLP as the Company's independent auditors for the fiscal year ending
September 30, 1999; and (iii) upon such matters as may properly come before the
Annual Meeting, in accordance with the best judgment of the persons appointed as
proxies.
1
<PAGE>
The proxy confers discretionary authority on the persons named therein
to vote with respect to the election of any person as a director where the
nominee is unable to serve, or for good cause will not serve, and matters
incident to the conduct of the Annual Meeting, including matters of which the
registrant did not receive notice until after November 25, 1998.
Any stockholder giving a proxy has the power to revoke it at any time
before it is exercised by (i) filing with the Secretary of the Company written
notice thereof (Susan J. Lowe, Secretary, Fidelity Bancorp, Inc., 1009 Perry
Highway, Pittsburgh, Pennsylvania 15237), (ii) submitting a duly executed proxy
bearing a later date or (iii) appearing at the Annual Meeting and giving the
Secretary notice of his or her intention to vote in person. Proxies solicited
hereby may be exercised only at the Annual Meeting and any adjournment thereof
and will not be used for any other meeting.
CERTAIN BENEFICIAL OWNERS THEREOF
Persons and groups owning in excess of 5% of the Common Stock are
required to file certain reports disclosing such ownership pursuant to the
Securities Exchange Act of 1934, as amended ("Exchange Act"). Based upon such
reports and information provided to the Company, the Company does not know of
any person or entity who was a beneficial owner of more than 5% of the Company's
outstanding shares of Common Stock on the Voting Record Date, other than those
listed below. Security ownership of executive officers named in the Summary
Compensation Table and of directors, including Mr. Windisch, is included under
"Proposal I - Election of Directors."
<TABLE>
<CAPTION>
Name of Beneficial Owner Amount and Nature of
or Number of Beneficial Ownership as of Percent of
Persons in Group December 22, 1998 (1) Common Stock
---------------- --------------------- ------------
<S> <C> <C>
Fidelity Bancorp, Inc. 157,821 (2) 7.97%
Employee Stock Ownership Plan
1009 Perry Highway
Pittsburgh, PA 15237
The Banc Funds 122,945 (3) 6.21%
208 South LaSalle Street
Chicago, IL 60604
National City Corporation 165,131 (4) 8.34%
1900 E. Ninth Street
Cleveland, OH 44114
William L. Windisch 107,484 (5) 5.36%
Director; President and Chief
Executive Officer of the Company and Bank
</TABLE>
(1) Based upon filings made pursuant to the Exchange Act and information
furnished by the respective individuals. Under regulations promulgated
pursuant to the Exchange Act, shares of Common Stock are deemed to be
beneficially owned by a person if he or she directly or indirectly has
or shares (i) voting power, which includes the power to vote or to
direct the voting of the shares or (ii) investment power, which
includes the power to dispose or direct the disposition of the shares.
Unless otherwise indicated,
2
<PAGE>
the named beneficial owner has sole voting and dispositive power with
the respect to the shares. Adjusted to reflect two 10% stock dividends
and the 5-for-4 stock split.
(2) Pursuant to a schedule 13G filed by Integra Financial Corporation,
Integra Investment Company and Integra Trust Company trustee of and/or
administrator of the Bank's Employee Stock Ownership Plan ("ESOP"),
which has shared dispositive power over 157,821 shares of Common Stock.
Such shares are voted by the trustee in accordance with instructions
from either participants (as to shares allocated to their accounts) or
the Plan Administrator of the ESOP (as to unallocated shares).
(3) Pursuant to an amended Schedule 13D which indicates that Banc Funds,
consisting of the following: The Midwest Bank Fund II, L.P., an
Illinois limited partnership; Bank Fund III, L.P., an Illinois limited
partnership; Bank Fund III Trust; Bank Fund IV, L.P., an Illinois
limited partnership; and Bank Fund IV Trust.
(4) Pursuant to an amended Schedule 13G filed by National City Corp.,
Cleveland, Ohio ("NCC"). NCC acts as trustee for the Company's ESOP
(see Note 2).
(5) See Note (5) to the table under "Proposal I - Election of Directors.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Common Stock is registered pursuant to Section 12(g) of the
Exchange Act. The executive officers and directors of the Company and beneficial
owners of greater than 10% of the Common Stock ("10% beneficial owners") are
required to file reports on Forms 3, 4 and 5 with the Securities and Exchange
Commission ("SEC") disclosing changes in beneficial ownership of the Common
Stock. Based on the Company's review of Forms 3, 4 and 5 filed by officers,
directors and 10% beneficial owners of Common Stock, no executive officer,
director or 10% beneficial owner of Common Stock failed to file such ownership
reports on a timely basis during the fiscal year ended September 30, 1998.
PROPOSAL I - ELECTION OF DIRECTORS
The Bylaws of the Company presently provide that (i) the Board of
Directors shall consist of not less than five members and (ii) the Board of
Directors shall be divided into three classes as nearly equal in number as
possible. The members of each class are to be elected for a term of three years
or until their successors are elected and qualified. One class of directors is
to be elected annually.
Unless otherwise directed, each proxy executed and returned by a
stockholder will be voted for the election of the nominees listed below. If the
nominees should be unable or unwilling to stand for election at the time of the
Annual Meeting, the Board of Directors, as proxies, will nominate and vote for a
replacement nominee recommended by the Board of Directors. At this time, the
Board of Directors knows of no reason why any of the nominees listed below may
not be able to serve as a director if elected.
The following table sets forth each nominee and continuing director's
name, age, the year he or she first became a director, the year in which his or
her current term will expire and the number of shares and percentage of the
Common Stock beneficially owned on the Voting Record Date. The following table
also sets forth, for all executive officers and directors as a group and for
each executive officer listed in
3
<PAGE>
the Summary Compensation Table under the caption "Executive Compensation," the
number of shares and the percentage of the Company's Common Stock beneficially
owned on the Record Date.
<TABLE>
<CAPTION>
Shares of
Year First Current Common Stock Percent
Elected Term to Beneficially of
Name Age(1) Director(2) Expire Owned(3)(4) Class
- ---- ------ ----------- ------ ----------- -----
<S> <C> <C> <C> <C>
BOARD NOMINEES FOR TERMS TO EXPIRE IN 2002
Robert F. Kastelic................... 64 1990 1999 11,567 *
Oliver D. Keefer..................... 55 1987 1999 36,150 1.82%
Charles E. Nettrour.................. 66 1987 1999 61,668(6) 3.10%
DIRECTORS CONTINUING IN OFFICE
William L. Windisch 66 1958 2000 107,484(5) 5.36%
Joanne Ross Wilder 56 1996 2000 3,779 *
J. Robert Gales...................... 63 1984 2001 77,858 3.91%
CERTAIN EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Richard G. Spencer................... 51 42,307 2.11%
Michael A. Mooney.................... 44 25,992 1.30%
All executive officers and directors
as a group (8 persons)............... 366,805(7) 17.54%
</TABLE>
* Represents less than 1% of the outstanding Common Stock.
(1) As of September 30, 1998.
(2) Includes terms as a director of the Bank prior to the formation of the
Company in 1993. All directors of the Company currently serve as
directors of the Bank.
(3) As of December 22, 1998. Based on information furnished by the
respective individuals. Unless otherwise indicated, the named
beneficial owner has sole voting and dispositive power with respect to
the shares.
(4) Includes shares of Common Stock which may be acquired within 60 days
pursuant to the exercise of outstanding stock options. Shares of Common
Stock which are subject to stock options are deemed to be outstanding
for the purpose of computing the percentage of Common Stock owned by
such person but are not deemed to be outstanding for the purpose of
computing the percentage of Common Stock owned by any other person. The
amounts of such shares included above are as follows: Mr. Windisch,
26,304 shares; Mr. Gales, 9,450 shares; Mr. Kastelic, 9,450 shares; Mr.
Keefer, 9,450 shares; Mr. Nettrour, 9,450 shares; Ms. Wilder, 3,517
shares; Mr. Spencer, 22,117 shares and Mr. Mooney, 21,321 shares.
(5) Includes 42,994 shares of Common Stock owned jointly with Mr.
Windisch's wife, 20,748 shares owned solely by Mr. Windisch's wife, and
1,409 shares held by his daughter who resides with him. Includes 16,029
shares of the Common Stock held in the ESOP which have been allocated
to Mr. Windisch's account and 26,304 shares which may be acquired by
Mr. Windisch within 60 days pursuant to exercise of stock options. Does
not include 8,075 shares held by the ESOP which have not been allocated
to participants' accounts, which shares are voted by the trustee of the
ESOP in accordance with instructions from Mr. Windisch in his capacity
as the Plan Administrator of the ESOP.
(6) Includes 40,507 shares owned by Mr. Nettrour and 11,711 shares owned by
Martin & Nettrour, Incorporated.
4
<PAGE>
(7) Includes options for 111,059 shares of Common Stock which may be
acquired within 60 days pursuant to the exercise of outstanding stock
options under the Company's Employee Stock Compensation Program and
31,225 shares of Common Stock held in the ESOP which have been
allocated to the accounts of the Bank's officers.
The principal occupation during the past five years of each nominee,
director and executive officer of the Company is set forth below.
Directors
Robert F. Kastelic is President and Chief Executive Officer of X-Mark
Industries, a precision metal manufacturer in Washington, Pennsylvania. He is
also Chairman of the Board of Directors of Quasitronics Inc., an electronic and
computer peripheral equipment company in Houston, Pennsylvania.
Oliver D. Keefer is owner of Ralph E. Lane, certified public
accountants in Zelienople, Pennsylvania.
Charles E. Nettrour is President and Chief Executive Officer of Martin
& Nettrour, Incorporated, an insurance brokerage and consulting firm in
Pittsburgh, Pennsylvania and also of Retirement Designs Unlimited, Inc.,
retirement plan specialists in Pittsburgh, Pennsylvania.
William L. Windisch is President and Chief Executive Officer of the
Company and Bank.
Joanne Ross Wilder is President of Wilder, Mahood & Crenney, a legal
services firm in Pittsburgh, Pennsylvania.
J. Robert Gales is President and owner of J.R. Gales & Associates, a
civil engineering consulting firm in Pittsburgh, Pennsylvania.
Executive Officers Who Are Not Directors
Richard G. Spencer is the Vice President, Chief Financial Officer and
Treasurer of the Company and Bank.
Michael A. Mooney is the Vice President of the Company and Bank and the
Chief Lending Officer of the Bank.
Board Meetings and Committees
The Board of Directors of the Company met 14 times during the fiscal
year ended September 30, 1998 and maintains standing Executive, Audit,
Investment, Compensation, Nominating, Employee Stock Compensation and
Shareholder Value Committees. During the fiscal year ended September 30, 1998,
the Board of Directors of the Bank met 13 times. No director
5
<PAGE>
attended fewer than 75% of the aggregate number of meetings held during fiscal
1998 by the Board of Directors of the Company or the Bank and by all committees
on which he or she served during the year.
The Audit Committee of the Company and the Bank, which met three times
in fiscal 1998, reviews the records and affairs of the Company and the Bank to
determine its financial condition, reviews with management and the independent
auditors the systems of internal control, and monitors the Company's and the
Bank's adherence in accounting and financial reporting to generally accepted
accounting principles. Currently, all non-employee directors serve as members of
this Committee.
The Nominating Committee of the Company and the Bank met once in fiscal
year 1998 and consists of the entire Boards of Directors. This Committee selects
nominees for election as directors of the Company and the Bank. Although the
Nominating Committee of the Company will consider nominees recommended by
stockholders, it has not actively solicited recommendations for nominees from
stockholders nor has it established procedures for this purpose. However, the
Company's articles of incorporation (the "Articles") allows stockholders
entitled to vote at the election to submit nominations. The nominations must be
made in writing and submitted to the Company's Secretary no less than 60 days
prior to the anniversary date of the immediately preceding annual meeting of the
Company stockholders. Furthermore, any nomination not made in compliance with
the procedures set forth in the Articles may be refused to be acknowledged by
the presiding officer.
The Compensation Committee of the Company and the Bank met twice in
fiscal 1998 and has the responsibility of reviewing the compensation paid by the
Company and Bank.
Director Compensation
Except for Mr. Windisch, directors of the Company receive an annual
stipend of $10,000 per year without regard to attendance at meetings. No fees
are paid by the Company for attending Board or Committee meetings of the
Company, although such meetings are generally held in conjunction with
comparable meetings of the Bank for which fees are paid. Directors of the Bank
receive $275 for each regular or special Board meeting attended, $275 for the
first Bank Committee meeting attended on any date, $100 for any subsequent Bank
Committee meeting held on the same date, and $100 for any telephone Bank
Committee meeting. Mr. Windisch, as a salaried employee, receives no director's
fees. The Company paid a total of $92,200 in directors' fees for the fiscal year
ended September 30, 1998.
At the Company's 1994 Annual Meeting, the stockholders approved the
1993 Directors' Stock Option Plan (the "Directors Plan"). Pursuant to the terms
of the Directors Plan, an aggregate of 60,500 of authorized but unissued shares
(as adjusted for two 10% stock dividends and a 5-for-4 stock split) were
reserved for future issue to non-employee directors. On December 31, 1997, each
non-employee director (i.e., Directors Gales, Keefer, Nettrour, Wilder and
6
<PAGE>
Kastelic) received options to purchase 1,890 shares of Common Stock from the
Directors Plan reserved shares.
Executive Compensation
The following table sets forth, for the fiscal years ended September
30, 1998, 1997 and 1996, certain information as to the total remuneration
received by the chief executive officer as well as by each of the two other most
highly compensated executive officers of the Company whose total annual salary
and bonus exceeded $100,000 during these periods for services rendered in all
capacities to the Company.
<TABLE>
<CAPTION>
SUMMARY OF COMPENSATION TABLE
Annual Compensation Long Term Compensation Awards
----------------------------------------- -----------------------------
Securities
Other Annual Restricted Underlying All
Compensation Stock Award(s) Options/ Other
Name & Principal Position Year Salary($)(1) Bonus($) ($)(2) ($) SARs (#) Compensation(3)
- ------------------------- ---- ------------ -------- ------ --- -------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
William L. Windisch 1998 147,846 25,025 0 0 3,750 $79,059(4)
President and CEO 1997 140,538 20,250 0 0 3,781 10,680
1996 130,397 5,000 0 0 3,025 23,739
Richard G. Spencer 1998(5) 89,585 12,960 0 0 3,125 4,905
CFO and Treasurer
Michael A. Mooney 1998(5) 89,462 12,900 0 0 3,125 3,901
Vice President
</TABLE>
- -----------------
(1) Includes amounts deferred pursuant to the Company's Thrift Plan which
allows employees to defer up to 15% of their compensation, up to the
maximum established by law.
(2) Does not include amounts attributable to miscellaneous benefits received,
including the use of Bank-owned automobiles.
(3) Consists of matching contributions by the Bank on behalf of these
executives pursuant to the Bank's Thrift Plan and allocations to their
account in the ESOP. The value placed on the ESOP shares assumes a per
share value as of the last day of the fiscal year. Also includes benefits
received under the Bank's SCP and GTR Plan.
(4) Includes $69,444 for the amount of benefits received under the Bank's SCP.
(5) No disclosure is provided for the fiscal year ended September 30, 1997 and
1996 as such executive officer's total annual salary and bonus did not
exceed $100,000 during these periods.
Employment Agreements
The Company and the Bank currently have an employment agreement with
William L. Windisch, the President and Chief Executive Officer of the Company
and the Bank (collectively, the "Employers"). Mr. Windisch's employment
agreement commenced on January 1, 1994, with an initial term of three years and
was extended effective January 1, 1998, through December 31, 2000 by action of
the Board of Directors.
<PAGE>
Mr. Windisch's agreement is terminable by the Employers for just cause,
as defined, at any time upon written notice or in the occurrence of certain
events specified therein. The agreement contains provisions which provide Mr.
Windisch with specified benefits in the event that he is terminated subsequent
to a change in control of the Company, as defined, or terminates his employment
in connection with a change in control for good reason, as defined in the
agreement. The current annual salary for Mr.
7
<PAGE>
Windisch under his employment agreement is $150,000, which amount may be
adjusted each year as determined by the Board of Directors.
Payments and other benefits are provided for under the employment
agreement in the event of involuntary termination of employment in connection
with a change in control of the Company. A payment will also be provided on a
similar basis in connection with a voluntary termination of employment where,
subsequent to a change in control, Mr. Windisch is assigned duties and
responsibilities inconsistent with his position and status immediately prior to
a change in control. The payment to Mr. Windisch under the employment agreement
would generally equal 2.99 times his average annual compensation for the
preceding five calendar years, or approximately $417,956 if his employment had
been terminated in 1998. Such amount would be paid within five days following
the termination of employment. Section 280G of the 1986 Internal Revenue Code,
as amended (the "Code") states that severance payments which equal or exceed
three times the base compensation of an individual are deemed to be "excess
parachute payments" if they are contingent upon a change in control. Individuals
receiving excess parachute payments are subject to a 20% excise tax on the
amount of such excess payments, and the employer is not entitled to deduct the
amounts of such excess payments. Mr. Windisch's agreement provides that if the
severance payments to him would constitute an excess parachute payment, then the
payment would be reduced to the largest amount that could be paid without
constituting an excess parachute payment. If Mr. Windisch's employment is
terminated for reasons other than for cause and other than in connection with or
subsequent to a change in control, he will be entitled to a severance payment
equal to 2.99 times his then current base salary.
The Company also entered into three-year employment agreements with
Richard G. Spencer and Michael A. Mooney effective as of January 1, 1994. The
agreements provide for change in control payments equal to 2.99 times Mr.
Spencer's and Mr. Mooney's average compensation, in each case subject to the
limits of Section 280G of the Code. If employment is terminated for reasons
other than for cause, disability, retirement or death and other than in
connection with or subsequent to a change in control, the agreements provide for
severance equal to one times the officer's then current annual base salary, plus
the continuation of various benefits for one year.
In 1998, the Bank implemented two new benefit plans for certain
officers of the Bank. First, the Group Term Replacement Plan ("GTR") is a plan
where the Bank applies for and owns a life insurance policy on the life of the
employee. By way of a separate split dollar agreement, the policy interests are
divided between the Bank and the employee. The Bank owns the policy cash
surrender value, including the accumulated policy earnings, and the policy death
benefits over and above the cash surrender value are endorsed to the employee
and his or her beneficiary. The Bank also implemented the Salary Continuation
Plan ("SCP") which is a non-qualified executive benefit plan where the Bank
agrees to pay the executive additional benefits in the future, usually at
retirement. In 1998, pursuant to the SCP, the Bank entered into three separate
agreements with Messrs. Windisch, Spencer and Mooney.
8
<PAGE>
Stock Compensation Programs
The following tables set forth information concerning options granted
to the named executives.
<TABLE>
<CAPTION>
OPTION/SAR GRANTS TABLE
Option/SAR Grants in Last Fiscal Year
Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation for
Individual Grants Option Term
- -------------------------------------------------------------------------------------------- ---------------------------
Number of % of Total
Securities Option/SARs
Underlying Granted to Exercise or
Option/SARs Employees in Base Price Expiration
Name Granted (#) Fiscal Year ($/Sh) Date 5% ($) 10% ($)
------ ------------ ------------- -------- ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
William L. Windisch 3,750 13.15% 23.20 Dec. 31, 2007 54,714 138,656
Richard G. Spencer 3,125 10.96 23.20 Dec. 31, 2007 45,595 115,546
Michael A. Mooney 3,125 10.96 23.20 Dec. 31, 2007 45,595 115,546
<CAPTION>
OPTION/SAR EXERCISES AND YEAR END VALUE TABLE
Aggregated Option/SAR Exercises in Last Fiscal Year and FY-End Option/SAR Values
--------------------------------------------------------------------------------
Number of Securities
Underlying Unexercised Value of Unexercised In-
Option/SARs The-Money Option/SARs
Shares Acquired at FY-End (#) at FY-End (2)($)
Name on Exercise Value Realized ($)(1) Exercisable/Unexercisable Exercisable/Unexercisable
- -------------------- ------------- ---------------------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
William L. Windisch 6,915 162,696 23,781/2,523 224,302/0
Richard G. Spencer 1,825 42,464 20,286/1,831 180,394/0
Michael A. Mooney -- -- 19,490 1,831 166,925/0
</TABLE>
(1) Market value of the underlying securities at the date of exercise minus the
exercise price, multiplied by the number of underlying securities.
(2) Market value of the underlying securities at year-end minus the exercise
price, multiplied by the number of underlying securities.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee (the "Committee") of the Company consists of
Directors Gales, Kastelic, Keefer, Nettrour, and Wilder. This committee also
serves as the Compensation Committee for the Bank. Members of the Committee are
non-employee directors of the Company and Bank. The Committee met twice during
the fiscal year to review the performance of the Bank's officers and employees,
and to recommend compensation programs and salary actions for the Bank and its
personnel.
<PAGE>
Board Compensation Committee Report on Executive Compensation
The Compensation Committee of the Board of Directors has been assigned
the responsibility of recommending compensation levels and benefit programs for
the executive officers, including management employment agreements. The
Committee met two times during the past year, at which meetings they reviewed
executive management's current compensation, participation in employee benefit
programs and the terms of the existing management employment agreements. They
also made recommendations to the Board of Directors as to compensation
increases, as well as adjustments to the terms of the management employment
agreements.
When considering management compensation, the Committee reviews at
least one current compensation survey, comparing the Company's base salary,
bonus and benefit programs with savings and
9
<PAGE>
commercial banks of comparable size operating in the geographic area of
the Bank. The Committee uses the Bank's performance, by comparing current
performance results to overall Bank profitability. They also review the
individual performance of each executive officer and the contribution that
person has made to the Company during the year.
The Compensation Committee has established the following goals for the
compensation programs that pertain to executive management:
o To motivate the executive officers to enhance the stockholder value by
associating their compensation with the performance of the Company's
stock.
o To provide opportunities for earning compensation consistent with
competitive norms in the community in which the Company operates.
o To reward executives for achieving strategic performance initiatives.
For the calendar year ending December 31, 1998, President and Chief
Executive Officer William L. Windisch received an annual increase in base salary
from $143,000 to $150,000. In arriving at its recommendation, the Committee
considered the overall profitability of the Company during the past year.
In 1997 a Management Incentive Compensation Plan was established for
the calculation and payment of bonuses to senior executives. The Plan specifies
that a pool of funds will be created based upon the Bank achieving certain
income and other miscellaneous goals. The full amount of the pool will be paid
upon the attainment of 90% of the goal. Mr. Windisch's share of any pool created
will be 30%. The amount of that bonus for calendar year 1998 is $31,847. For
additional information of Mr. Windisch's compensation, please see the sections
on Executive Compensation, Employment Agreements, and Stock Compensation
Programs.
Certain Relationships and Related Transactions
The Bank offers loans to its directors, officers and employees.
However, all of such loans are made in the ordinary course of business, are made
on substantially the same terms, including interest rates, collateral and
application fees, as those prevailing at the time for comparable transactions
with non-affiliated persons and do not involve more than the normal risk of
collectibility or present other unfavorable features.
Charles E. Nettrour, a director of the Company, is the President and
sole owner of Martin & Nettrour, Incorporated, which provides insurance and
brokerage services to the Bank. During the fiscal year ended September 30, 1998,
that firm received $211,262 from the Bank in annualized general and group life,
health and long-term disability insurance premiums.
Performance Graph
The following graph compares the cumulative total shareholder return of
the Common Stock with that of (a) the total return index for domestic companies
listed on the Nasdaq Stock Market and (b) the total return index for banks
listed on the Nasdaq Stock Market. These total return indices of the Nasdaq
Stock Market are computed by the Center for Research in Securities Prices
("CRSP") at the University of Chicago. All three investment comparisons assume
the investment of $1,000 at the market close on
10
<PAGE>
September 30, 1993 and the reinvestment of dividends when paid. The graph
provides comparisons at the end of the past five fiscal years of the Company.
There can be no assurance that the Common Stock performance will
continue with the same or similar trends depicted in the graph below. The
Company will not make or endorse any predictions as to future stock performance.
[GRAPHIC-GRAPH PLOTTED TO POINTS LISTED BELOW]
<TABLE>
<CAPTION>
9/30/93 9/30/94 9/30/95 9/30/96 09/30/97 9/30/98
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Nasdaq U.S. $1000 $1,008 $1,393 $1,652 $2,268 $2,318
Nasdaq Bank $1000 1,052 1,326 1,693 2,820 2,798
Fidelity Bancorp $1000 1,113 1,070 1,541 2,219 3,164
</TABLE>
PROPOSAL II - RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
KPMG Peat Marwick LLP was the Company's independent auditor for the
1998 fiscal year. The Board of Directors has approved the selection of KPMG Peat
Marwick LLP as its auditor for the 1999 fiscal year, subject to ratification by
the Company's stockholders. A representative of KPMG Peat Marwick LLP is
expected to be present at the Annual Meeting to respond to stockholders'
questions and will have the opportunity to make a statement if he or she so
desires.
Ratification of the appointment of the auditors requires the
affirmative vote of a majority of the votes cast by the stockholders of the
Company at the Meeting. The Board of Directors recommends that stockholders vote
"FOR" the ratification of the appointment of KPMG Peat Marwick LLP as the
Company's auditors for the 1999 fiscal year.
11
<PAGE>
FINANCIAL INFORMATION
The audited financial statements of the Company for its fiscal year ended
September 30, 1998, prepared in conformity with generally accepted accounting
principles, are included in the Company's 1998 Annual Report to Stockholders,
which accompanies this Proxy Statement. Any stockholder who has not received a
copy of the Company's 1998 Annual Report to Stockholders may obtain a copy by
writing to the Secretary of the Company. Such Annual Report is not to be treated
as a part of the Company's proxy solicitation materials or as having been
incorporated herein by reference.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company'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 Company's main office at 1009
Perry Highway, Pittsburgh, Pennsylvania 15237, no later than September 9, 1999.
Any such proposals shall be subject to the requirements of the proxy rules
adopted under the Exchange Act.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Annual Meeting other than those matters described above in this Proxy Statement.
However, if any other matters should properly come before the Annual Meeting, it
is intended that proxies in the accompanying form will be voted in respect
thereof in accordance with the judgment of the person or persons voting the
proxies.
The cost of solicitation of proxies will be borne by the Company. The
Company 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 the Common Stock. In addition to solicitations by
mail, directors, officers and employees of the Company may solicit proxies
personally or by telephone without additional compensation.
FORM 10-K
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED
SEPTEMBER 30, 1998, AS FILED WITH THE SEC, WILL BE FURNISHED WITHOUT CHARGE TO
STOCKHOLDERS AS OF THE RECORD DATE UPON WRITTEN REQUEST TO THE SECRETARY,
FIDELITY BANCORP, INC., 1009 PERRY HIGHWAY, PITTSBURGH, PENNSYLVANIA 15237.
BY ORDER OF THE BOARD OF DIRECTORS
/s/Susan J. Lowe,
-----------------
Susan J. Lowe
Secretary
Pittsburgh, Pennsylvania
January 8, 1999
12
<PAGE>
REVOCABLE PROXY
FIDELITY BANCORP, INC.
[X] PLEASE MARK VOTES AS IN THIS EXAMPLE
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 2, 1999
The undersigned hereby appoints the Board of Directors of Fidelity Bancorp,
Inc. ("Company"), with full powers of substitution, to act as attorneys and
proxies for the undersigned, to vote all shares of Common Stock of the Company
that the undersigned is entitled to vote at the Annual Meeting of Stockholders,
to be held at the Perrysville Branch of Fidelity Bank, PaSB, 1009 Perry Highway,
Pittsburgh, Pennsylvania, on Tuesday, February 2, 1999 at 5:00 p.m.,
("Meeting"), and at any and all adjournments thereof, as follows:
1. The election as a director of all nominees listed below for terms specified
(except as marked to the contrary below):
Robert F. Kastelic (three years)
Oliver D. Keefer (three years)
Charles E. Nettrour (three years)
[ ] FOR [ ] WITHHOLD [ ] EXCEPT
INSTRUCTION: To withhold authority to vote for any individual nominee, mark
"Except" and write that nominee's name in the space provided below.
- --------------------------------------------------------------------------------
2. The ratification of the appointment of KPMG Peat Marwick LLP as auditors of
the Company for the 1999 fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PLEASE CHECK BOX IF YOU PLAN TO ATTEND THE MEETING. [ ]
In their discretion, such attorneys and proxies are authorized to vote on any
other business that may properly come before the Meeting or any adjournments
thereof.
The Board of Directors recommends a vote "FOR" Propositions 1 and 2.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR PROPOSITIONS 1 AND 2. IF ANY OTHER BUSINESS IS
PRESENTED AT THE MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY
IN THEIR BEST JUDGEMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO
OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
<PAGE>
Please be sure to sign and date
this Proxy in the box below.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
FIDELITY BANCORP, INC.
1009 Perry Highway o Pittsburgh, Pennsylvania 15237
(412) 367-3300
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS.
Should the above signed be present and elect to vote at the Meeting or at any
adjournment thereof and after notification to the Secretary of the Company at
the Meeting of the stockholder's decision to terminate this proxy, then the
power of said attorneys and proxies shall be deemed terminated and of no further
force and effect.
The above signed acknowledges receipt from the Company prior to the execution
of this proxy of the notice of Annual Meeting of Stockholders, a proxy statement
dated January 8, 1999 and an annual report.
Please sign exactly as your name appears on this proxy. When signing as
attorney, executor, administrator, trustee or guardian, please give full title.
If shares are held jointly, each holder should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY
PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE
