<PAGE> 1
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SCHEDULE 14A
(RULE 14A)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / 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 sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
XXXXX
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
XXXXXXXXXXXXXXXX
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
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<PAGE> 2
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD TUESDAY, APRIL 11, 1995
CORTLAND BANCORP
194 WEST MAIN STREET
CORTLAND, OHIO 44410
March 17, 1995
TO THE HOLDERS OF SHARES OF COMMON STOCK:
NOTICE IS HEREBY GIVEN that, pursuant to call of its
Directors, the regular Annual Meeting of Shareholders (the "Annual Meeting") of
Cortland Bancorp (the "Corporation") will be held at the Corporation's
principal office, 194 West Main Street, Cortland, Ohio, 44410, Tuesday, April
11, 1995, at 7:00 P.M., for the purpose of considering and voting upon the
following matters:
1. To elect Directors; and
2. To transact such other business as may properly
be brought before the meeting or any adjournment
thereof.
Only shareholders of record at the close of business on March
1, 1995, shall be entitled to notice of the meeting and to vote at the meeting
or at any adjournment thereof.
By Order of the Board of Directors
/s/ Dennis E. Linville
-------------------
Dennis E. Linville
Secretary
WE URGE YOU TO MARK, DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED
SELF-ADDRESSED ENVELOPE AS PROMPTLY AS POSSIBLE WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING IN PERSON. IF YOU DO ATTEND THE MEETING, YOU MAY WITHDRAW
YOUR PROXY AND VOTE IN PERSON.
<PAGE> 3
CORTLAND BANCORP
194 W. MAIN STREET
CORTLAND, OHIO 44410
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of Cortland Bancorp, an Ohio Corporation
(the "Corporation"), of Proxies in the accompanying form to be voted at the
Annual Meeting of Shareholders (the "Annual Meeting") of the Corporation to be
held on April 11, 1995, at 7:00 P.M., at the principal office of the
Corporation, 194 W. Main Street, Cortland, Ohio 44410. This Proxy Statement and
Proxy are first being sent to Shareholders on or about March 17, 1995.
All costs of solicitation of the Proxies will be borne by the
Corporation. Solicitation will be made by mail. Proxies may be further
solicited at no additional compensation by officers, directors, or employees of
the Corporation by telephone, written communication or in person. The
Corporation will reimburse banks, brokerage firms, and other custodians,
nominees, and fiduciaries for expenses reasonably incurred by them in sending
proxy material to the beneficial owners of shares of common stock of the
Corporation ("Common Shares"). No solicitation is to be made by specially
engaged employees or other paid solicitors.
A Proxy for use at the Annual Meeting accompanies this Proxy
Statement and is solicited by the Board of Directors of the Corporation. A
shareholder of the Corporation may use his Proxy if he is unable to attend the
Annual Meeting in person or wishes to have his Common Shares of the Corporation
voted by proxy even if he does attend the Annual Meeting. Without affecting any
vote previously taken, any shareholder executing a proxy may revoke it at any
time before it is voted by filing with the Secretary of the Corporation, at the
address of the Corporation set forth on the cover page of this Proxy Statement,
written notice of such revocation; by executing a later-dated proxy which is
received by the Corporation prior to the Annual Meeting; or by attending the
Annual Meeting and giving notice of such revocation in person. ATTENDANCE AT
THE ANNUAL MEETING WILL NOT, IN AND OF ITSELF, CONSTITUTE REVOCATION OF A
PROXY.
The Cortland Savings & Banking Company (the "Bank") is a
wholly-owned subsidiary of the Corporation.
<PAGE> 4
VOTING
Only those shareholders of record at the close of business on
March 1, 1995, will be entitled to vote at the Annual Meeting. The holder of
Common Shares is entitled to one vote for each Common, and a fractional vote on
each fractional Common Share held on all matters including the election of
Directors.
In the election of Directors, pursuant to Ohio law and the
Corporation's By-laws, the nominees receiving the greatest number of votes will
be elected. Common Shares as to which the authority to vote is withheld and
broker non-votes are not counted toward the election of directors, or toward
the election of the individual nominees specified in the Proxy.
CERTAIN BENEFICIAL OWNERS
The following table sets forth, as of January 31, 1995,
certain information with respect to the only person known to the Corporation to
be the beneficial owner of more than five percent (5%) of the outstanding
Common Shares of the Corporation. The Common Shares represent the Corporation's
only class of stock.
NAME & ADDRESS OF NUMBER OF SHARES
BENEFICIAL OWNER BENEFICIALLY OWNED (1) PERCENT (2)
----------------- ---------------------- -----------
Ohio Bancorp (3) 68,484 6.92%
801 Dollar Bank Bldg
20 Federal Plaza
Youngstown, Ohio 44503
1. Represents sole voting and investment power.
Information regarding number of shares is from
the Bank's records as transfer agent.
2. Based upon 988,745 outstanding Common Shares as
of January 31, 1995.
3. The Corporation understands that Ohio Bancorp has
been merged into National City Corporation, however,
no request has been made to transfer these Common
Shares into the name of National City Corporation.
ELECTION OF DIRECTORS
The Code of Regulations for the Corporation, adopted April 13,
1993, provides for a classified Board of Directors. Under Section 2.02(D) of
the Code of Regulations, the Board of Directors is divided into three classes
as nearly equal in number as the then fixed number of directors permits, with
the term of office of one class expiring each year. It further states that the
directors elected at the Annual Meeting in 1991, will hold office for a term
2
<PAGE> 5
expiring in 1994, the directors elected at the Annual Meeting in 1992, will
hold office for a term expiring in 1995, and the directors elected at the
Annual Meeting in 1993 will hold office for a term expiring in 1996. Each
director will hold office until the Annual Meeting for the year in which his
term expires and until his successor is duly elected and qualified, or until
his earlier resignation, removal from office or death.
It is the intention of the persons named in the proxy to vote
for the election of William A. Hagood, Richard L. Hoover, K. Ray Mahan and
Rodger W. Platt.
All nominees are presently members of the Board of Directors.
All of the nominees have stated their willingness to serve and no reason is
presently known why any of the nominees would be unable to serve as a director.
Each Proxy will be voted for such nominees unless the Proxy otherwise directs.
There are no family relationships among the executive officers
and/or directors of the Corporation. Each of the nominees and directors listed
below has furnished to the Corporation the information set forth with respect
to his principal occupation or employment and his beneficial ownership of
securities.
NOMINEES FOR ELECTION WHOSE TERMS WILL EXPIRE IN 1998
<TABLE>
<CAPTION>
PRINCIPAL COMMON SHARES PERCENT DIRECTOR OF
OCCUPATION(S) BENEFICIALLY OF COMMON THE CORP.
NAME & AGE SINCE 1990 OWNED 1/31/95(1) SHARES (2) SINCE
- ---------- ------------- ---------------- ----------- ----------
<S> <C> <C> <C> <C>
William A. Hagood, Owner & President, 1,989.085 (3) .20 1984
63 Tri-City Mobile
Homes, Inc.
Richard L. Hoover, Vice Pres. of 3,132.309 (3)(4) .32 1984
63 Sales & Consul-
tant, Apollo Com-
munications Sys-
tems, Inc. 1989-
1992; Consultant
& Sales Mgr, VMX,
Inc, 1992 & 1993;
Consultant & Major
Acct. Exec, VMX Inc.
1993 to 1994.
Retired in 1994
K. Ray Mahan, President, Mahan 24,953.969 (3)(5) 2.52 1984
55 Packing Company.
Rodger W. Platt, President & Chair- 7,027.019 (3)(6) .71 1984
59 man of the Board
of the Corp. and
President, Chair-
man of the Bank.
</TABLE>
3
<PAGE> 6
<TABLE>
<CAPTION>
PRINCIPAL COMMON SHARES PERCENT DIRECTOR OF
OCCUPATION(S) BENEFICIALLY OF COMMON THE CORP.
NAME & AGE SINCE 1990 OWNED 1/31/95(1) SHARES (2) SINCE
- ---------- ------------- ---------------- ----------- ----------
CONTINUING DIRECTORS WHOSE TERMS WILL EXPIRE IN 1997
<S> <C> <C> <C> <C>
George E. Gessner, Attorney at Law, 4,447.502 (7) .45 1987
50 Gessner, Platt &
Dull Co. L.P.A.
James E. Hoffman,III, Attorney & Presi- 552.171 .06 1984
43 dent Hoffman &
Walker Co. L.P.A.
Timothy K. Woofter, Executive Vice 6,801.547 .69 1985
44 President, and
part owner of
Stanwade Metals
Products.
CONTINUING DIRECTORS WHOSE TERMS WILL EXPIRE IN 1996
P. Bennett Bowers, Vice President & 3,901.145 (8) .40 1988
44 25% Owner Bowers
Insurance Agency,
Inc.
David C. Cole, General Manager, 429.000 (9) .04 1989
36 Clyde Cole
Cadillac until
1992, General
Manager, Cole
Valley Motor Co.
since 1992.
Dennis E. Linville, Executive Vice 1,618.000 (10) .16 1988
44 President, Corp.
Secy. of the
Corporation and
the Bank.
Treasurer of
the Corporation
and the Bank from
1987-1992.
Executive Officers 56,776.585 (11) 5.74
and Directors as a
Group (12 Persons)
(1) Represents sole voting and investment power unless otherwise indicated.
(2) Based upon 988,745 of the Corporation's Common Shares outstanding as
of January 31, 1995.
(3) Director of Cortland Savings and Banking Company prior to
formation of the Corporation.
</TABLE>
4
<PAGE> 7
(4) Includes 1,589.309 Common Shares owned by Marlene Hoover, Mr. Hoover's
wife.
(5) Includes 6,271.222 Common Shares owned by Nancy Mahan, Mr. Mahan's
wife and 1,511.706 Common Shares owned by Jill Mahan, Mr. Mahan's
child.
(6) Includes 251 Common Shares owned by Marie Platt, Mr. Platt's wife, 111
Common Shares held by Julie Platt, and 111 Common Shares owned by Mark
Platt, Mr. Platt's children.
(7) Includes 2,874 Common Shares held in a voting trust of which Mr.
George Gessner is the trustee and Mr. John F. Gessner is the
beneficial owner.
(8) Includes 3,121 Common Shares held in a voting trust of which Mr. P.
Bennett Bowers is the trustee and Mr. Paul C. Bowers is the beneficial
owner. The amount also includes 100 Common Shares owned by Laraine
Bowers, Mr. P. Bennett Bowers' wife, in a self-directed IRA.
(9) Includes 54 Common Shares owned by Marian Cole, Mr. Cole's wife, 115
Common Shares held by Marian Cole for Christopher Cole, and 24 Common
Shares held by Marian Cole for Jonathan David Cole, Mr. Cole's
children.
(10) Includes 53.96 Common Shares owned by Erin Linville and 40.564 Common
Shares owned by Brandon Linville, Mr. Linville's children.
(11) See notes (1) through (10).
THE BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors of the Corporation held eleven (11)
meetings during the fiscal year ended December 31, 1994. Every Director
attended at least 75% of the meetings of the Board and committees on which he
served during the year.
The Corporation's Board of Directors does not have committees.
The Bank's Board of Directors has an Audit Committee, which met five (5) times
in 1994. Timothy Woofter attended five (5) meetings, David Cole attended four
(4) meetings and P. Bennett Bowers attended three (3) meetings. The functions
performed by the Audit Committee include the following: (1) to recommend to
the Board of Directors independent accountants for the coming year; (2) to
ensure that all director examinations and audits are in compliance with
statutory requirements; (3) to review and approve
5
<PAGE> 8
the audit plan of the external auditors; (4) to review non-audit services
performed by external auditors; (5) to determine that a competent internal
audit organization exists to meet the needs of the Corporation and the Bank;
(6) to review and approve the audit plan submitted by the General Auditor; (7)
to receive periodic reports from the General Auditor regarding the completion
of the audit schedule and the results of reviews performed by the internal
audit function; (8) to receive on an annual basis a summary of internal audit
activities, including a summary of the status of significant items disclosed
during the year and an opinion on the adequacy of the organization's system of
internal controls; (9) to review and approve audit policies; (10) to review the
results of regulatory examinations and receive periodic updates on management's
efforts to address any noted deficiencies or recommendations; (11) to review
with representatives of the external audit firm periodic accounting and
financial reports and to review the contents of the management letter issued by
the external audit firm; and (12) to evaluate with the auditors and management
the Corporation's and the Bank's compliance with banking regulations, other
pertinent laws and internal guidelines on employee conduct and conflicts of
interest.
The Executive Compensation Committee consists of three members of the
Bank's Board of Directors, Richard L. Hoover, K. Ray Mahan and David C. Cole,
and the Bank's Director of Human Resources, Stephen A. Telego, Sr. (Every
member of the Executive Compensation Committee attended at least 75% of the
committee's meetings during 1994.) The Corporation does not compensate its
employees. Instead, all employees of the Corporation are compensated in their
capacities as employees of the Corporation and the Bank. It is the
responsibility of the Executive Compensation Committee to establish and
administer the Bank's compensation policies and evaluations for its executive
officers.
Neither the Corporation nor the Bank has a Nominating
Committee.
REMUNERATION OF OFFICERS AND DIRECTORS
EXECUTIVE COMPENSATION
The following table sets forth cash compensation paid by the
Bank to Rodger W. Platt, President and Chairman of the Board of Directors of
the Corporation and President and Chairman of the Bank, for services performed
for the Corporation and the Bank. Mr. Platt is the only executive officer of
the Corporation to earn salary and bonus in excess of $100,000, for the three
fiscal years ended December 31, 1994.
6
<PAGE> 9
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
ANNUAL ALL OTHER
COMPENSATION COMPENSATION
- ----------------------------------------------------------------------------------------------------------------------------------
NAME AND
PRINCIPAL
POSITION YEAR SALARY ($)(1) ($)(2)(3)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Rodger W. Platt, 1994 $ 126,388 $10,062
President and Chairman of 1993 115,644 4,386
the Board of the Corporation 1992 110,034 4,161
and President, and Chairman
of the Bank
(1) The salary amounts listed for each of the above years include $6,000
in directors' fees for serving as a director of the Bank.
(2) Includes Profit Sharing paid to employees on December 31, 1994. Mr.
Platt's share of the profit was calculated with the same formula
used for all employees.
(3) Includes a combination of non-elective contributions for Mr. Platt and
employer matching of employee contributions up to two percent
(2%) of salary under the Bank's 401(k) plan.
</TABLE>
DIRECTORS' COMPENSATION
- -----------------------
The Directors of the Corporation do not receive remuneration
for their service to the Corporation; however, the same persons that serve as
Directors for the Corporation serve as Directors for the Bank. In 1994, each
non-employee ("outside") Director for the Bank received fixed compensation for
serving as a Director at the rate of $750 per month. Each employee ("inside")
Director for the Bank received fixed compensation for serving as a Director at
the rate of $500 per month. Neither the inside nor the outside directors
received any additional amounts for participation at Board of Directors'
meetings, committee participation or special assignments.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Corporation and the Bank retained the legal services of
Hoffman & Walker Co., L.P.A. during 1994. James E. Hoffman, III, is a member of
the Corporation's Board of Directors. Mr. Hoffman is also a member of Hoffman &
Walker Co., L.P.A. The amount of fees paid to Hoffman & Walker Co., L.P.A. by
the Corporation and the Bank during 1994 was less than five percent (5%) of the
law firms gross revenue during 1994.
7
<PAGE> 10
The Corporation and Bank also retained the legal services of
Gessner, Platt & Dull Co., L.P.A. Mr. George E. Gessner is a member of the
Corporation's Board of Directors. Mr. Gessner is also a member of Gessner,
Platt & Dull Co., L.P.A.. The amount of fees paid to Gessner, Platt & Dull Co.
L.P.A. by the Corporation and the Bank during 1994 was less than five percent
(5%) of the law firm's gross revenues during 1994.
REPORT ON EXECUTIVE COMPENSATION
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE
CORPORATION'S PREVIOUS FILINGS UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, THAT
MIGHT INCORPORATE FUTURE FILINGS, INCLUDING THIS PROXY STATEMENT, IN
WHOLE OR IN PART, THIS REPORT AND THE GRAPH SET FORTH ON PAGE 11,
SHALL NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH FILINGS.
The executive officers of the Corporation receive no
compensation from the Corporation. Instead, they are paid by the Bank for
services rendered in their capacity as executive officers of the Corporation
and the Bank.
Pursuant to the compensation program, the executive officers
of the Bank, including Mr. Platt, are evaluated on their performance. The
ratings range from a top score of 5, which is superior rating; to a rating of
1, which represents a low rating, deficiency of job performance. The major
areas of performance measurements are Job Knowledge/Information, Work Quality,
Accuracy, Initiative, Originality, Customer Relations, Priority Setting,
Ability To Provide Instruction to Staff, Subordinate Feedback and Overall
Evaluation.
In addition, key responsibilities and duties of the position
are measured. For Mr. Platt, those key responsibilities are leadership,
direction and guidance of Bank activities; keeping the Board of Directors
informed on all significant Bank activities; initiating recommendations to the
Board regarding competition, organizational changes, new products, and
expansion of service area; communicating policies and goals to officers and
department heads as well as monitoring employee morale; striving to maintain
"esprit de corps" at a level conductive to high productivity; delegating
responsibility; reviewing and evaluating performance of senior officers in
carrying out their responsibilities; insuring integrity of Bank assets;
cultivating relationships with customers, the community and other bankers in
order to monitor the needs of the marketplace and the services provided by
competitors; maintaining relationships with stockholders of the Corporation and
the outside financial community; exploring potential bank and non-bank business
opportunities for enhancing the profitability of the Community Banks and parent
holding company and the outside
8
<PAGE> 11
financial community; providing guidance and direction for an on-going strategic
planning process.
At its February 22, 1994 Committee meeting, the Executive
Compensation Committee reviewed the self-evaluation of Rodger W. Platt. The
Committee was in concurrence with Mr. Platt's self-evaluation of a rating of a
four (4) which is "above expected" and made a recommendation to the Board of
Directors for its review and acceptance.
The Executive Compensation Committee approved and recommended
to the Board of Directors a seven percent (7%) merit adjustment based on the
Employee Evaluation/Matrix Program. This adjusted Mr. Platt's salary to
$115,688.40.
In addition to the merit adjustment, the Executive
Compensation Committee addressed the salary grade level and range assigned to
Mr. Platt's position. It was noted by the Committee that Mr. Platt's salary
was in the lower one-third of his pay grade. Thus, based on Mr. Platt's recent
job evaluation of "above expected" it was the Committee's decision to recommend
to the Board of Directors, an additional adjustment to his salary. This would
bring Mr. Platt's salary more in line with his peer group.
Therefore, the Committee recommended to the Board of Directors
that Mr. Platt be awarded an additional $5,311.60 which brought his salary to
$121,000 per year, which is at a level between the lower one-third and the
midpoint of his pay range.
The above Executive Compensation Committee recommendations
were made to the entire Board on March 1, 1994 and were approved by the Board
for immediate implementation.
THE EXECUTIVE COMPENSATION COMMITTEE
Board Members
-------------
Richard L. Hoover
K. Ray Mahan
David C. Cole
Advisor
-------
Stephen A. Telego, Sr.
Director of Human Resources
9
<PAGE> 12
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG CORTLAND BANCORP, THE S&P 500 INDEX AND
SNL SECURITIES INDEX OF BANKS ASSET-SIZE UNDER $500M
The graph on the following page sets forth a comparison of
five year cumulative total return among the Common Shares, the Standard &
Poor's Index ("S&P 500 Index") and the SNL Securities Index of Banks Asset-size
under $500M for the fiscal years indicated. Information reflected on the graph
assumes an investment of $100 on December 31, 1989, in each of Common Shares,
the S&P 500 Index and the SNL Securities Index. Cumulative total return
assumes reinvestment of dividends. The Corporation is not among the banking
companies included in the SNL Securities Index.
10
<PAGE> 13
<TABLE>
CORTLAND BANCORP
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
AMONG CORTLAND BANCORP., S&P 500 INDEX AND SNL <$500M BANK INDEX
<CAPTION>
Period Cortland S&P 500 SNL<500M Bank
Ending Bancorp Index Index
- -------------------------------------------------------------------
<S> <C> <C> <C>
12/31/89 100.00 100.00 100.00
12/31/90 102.37 96.90 55.00
12/31/91 72.58 126.43 77.36
12/31/92 97.45 136.06 112.70
12/31/93 112.44 149.77 138.53
12/31/94 140.48 151.45 146.52
</TABLE>
11
<PAGE> 14
INDEBTEDNESS OF AND TRANSACTIONS WITH MANAGEMENT
Some of the Directors, officers and affiliates of both the
Corporation and the Bank are customers of and have banking transactions with
the Bank. All of these transactions were in the ordinary course of the Bank's
business during 1994 and up to the present time. All loans and commitments to
loan included in such transactions were made in the ordinary course of business
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 the Corporation, do not involve more
than a normal risk of collectibility or present other unfavorable features.
REPORTING PURSUANT TO SECTION 16 OF SECURITIES EXCHANGE ACT
Under the securities laws of the United States, the
Corporation's Directors, executive officers, and persons holding more than ten
percent of the Common Shares are required to report their ownership of the
Common Shares and any changes in that ownership to the Securities and Exchange
Commission (the "Commission"). The Corporation is required to report in this
Proxy Statement any omissions from such reports during the last fiscal year.
According to the records of the Corporation, all of these filing requirements
were satisfied by the Corporation's Directors and officers. In making these
statements, the Corporation has relied on the written representations of its
Directors and officers and copies of the reports that they have filed with the
Commission.
AUDITING MATTERS
On February 8, 1994, the Board of Directors of the Corporation
and the Bank engaged the independent accounting firm of Packer Thomas and
Company to audit the consolidated financial statements for the period ending
December 31, 1994. The independent accounting firm of Crowe Chizek and Company,
which has audited the consolidated financial statements as of December 31,
1993, has been dismissed effective as of February 4, 1994, the date of the
firm's issuance of the Report of the Independent Auditors. In connection with
the audits of the Corporation's financial statements for the year ended
December 31, 1993, there were no disagreements with Crowe Chizek and Company on
any matters of accounting principles or practices, financial statement
disclosure, or auditing scope and procedure. The report of Crowe Chizek and
Company on the Corporation's financial statements for the year ended December
31, 1993, did not contain an adverse opinion or a disclaimer of opinion and was
not qualified or modified as to uncertainty, audit scope or accounting
principles. The decision to change independent accountants was reviewed by the
Bank's Audit Committee and unanimously approved by the Board of Directors of
the Corporation. The report of Packer Thomas and Company on the Corporation's
financial statements for the year ended December 31, 1994, did not
12
<PAGE> 15
contain an adverse opinion or a disclaimer of opinion and was not qualified or
modified as to uncertainty, audit scope or accounting principles.
Neither representatives of Crowe Chizek and Company nor
representatives of Packer Thomas and Company are expected to be in attendance
at the Annual Meeting.
OTHER MATTERS
The Board of Directors is not aware of any other matters which
may come before the Annual Meeting. However, if any other matters requiring a
vote of shareholders are properly presented to the meeting, it is intended that
Proxies in the accompanying form will be voted on such other matters in
accordance with the recommendations of the Board of Directors or in accordance
with their best judgment on such matters.
ANNUAL REPORT
The 1994 Annual Report, including the required audited
financial statements of the Corporation and related financial information, is
enclosed with this proxy soliciting material.
A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K INCLUDING FINANCIAL
STATEMENTS AND FINANCIAL STATEMENT SCHEDULES, AS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION, IS AVAILABLE WITHOUT CHARGE UPON WRITTEN REQUEST OF A
SHAREHOLDER. PLEASE ADDRESS YOUR REQUEST TO DENNIS E. LINVILLE, SECRETARY,
CORTLAND BANCORP, 194 WEST MAIN STREET, CORTLAND, OHIO 44410. [P.O. BOX #98],
TELEPHONE (216) 637-8040.
PROPOSALS BY SHAREHOLDERS FOR 1996 MEETING
If any shareholder of the Corporation wishes to submit a
proposal to be included in next year's Proxy Statement and acted upon at the
annual meeting of the Corporation to be held in 1996, the proposal must be
received by the Corporation prior to the close of business on November 17,
1995.
MISCELLANEOUS
You are urged to mark, date, sign, and return your proxy
promptly. For your convenience, a self-addressed envelope is enclosed on which
no postage is required if mailed in the United States.
By Order of the Board of Directors
/s/ Dennis E. Linville
------------------
Dennis E. Linville
Secretary
March 17, 1995
13
<PAGE> 16
FORM OF PROXY
CORTLAND BANCORP
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CORTLAND BANCORP
The undersigned holder of Common Shares of Cortland Bancorp. (The
"Corporation") hereby appoints David C. Cole, George E. Gessner, and James E.
Hoffman III, or any of them, each with power of substitution, as his proxies to
attend the Annual Meeting of Shareholders of the Corporation to be held on
Tuesday, April 11, 1995 at 7:00 p.m. at the Corporation's principal office,
194 West Main street, Cortland, Ohio, to vote as designated below upon the
following matters:
(1) FOR election as Directors WITHHOLD AUTHORITY
of all nominees listed below. to vote for all nominees
listed below.
William A. Hagood, Richard L. Hoover, K. Ray Mahan, Rodger W. Platt
(INSTRUCTIONS: To withhold authority to vote for any individual nominee write
that nominee's name on the space provided below.)
____________________________________________________________________
(2) In their discretion, the proxies are authorized to vote on the
transaction of such other business as may properly come before the meeting.
FOR AGAINST ABSTAIN
------ ------ ------
The Corporation's Board of Directors is not aware of any other matters that
will be presented for action at said meeting.
SHARES WILL BE VOTED AS SPECIFIED, BUT IF NO SPECIFICATION IS MADE, SHARES WILL
BE VOTED FOR THE ELECTION OF ALL OF THE NOMINEES LISTED IN ITEM (1), AND, AT
THE DISCRETION OF THE PROXIES, ON ANY OTHER BUSINESS PROPERLY BROUGHT BEFORE
THE MEETING.
Receipt of the Notice of Annual Meeting of Shareholders and Proxy Statement is
hereby acknowledged.
Please sign, date, and return this proxy promptly in the enclosed envelope.
Dated:_________________________, 1995
Signed:________________________________
Signed:________________________________
Please sign exactly as the name appears
hereon. If executor, trustee, etc.,
give full title. If shares are
registered in two names, both
shareholders should sign.
