<PAGE> 1
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 the Registrant [X]
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 Rule 14a-11(c) or Rule 14a-12
CNB CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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:
- --------------------------------------------------------------------------------
<PAGE> 2
[CNB CORPORATION LETTERHEAD]
April 16, 1999
Dear Shareholder:
You are cordially invited to attend the annual meeting of CNB Corporation to be
held at the Knights of Columbus Hall, 9840 S. Straits Highway (near the
intersection of highways U.S. 27 and M-33), Cheboygan, Michigan, at 5:30 p.m. on
Tuesday, May 18, 1999. The Notice of Annual Meeting and Proxy Statement follow
this letter and the Corporation's 1998 Annual Report is enclosed.
It is important that your shares be represented at the meeting. Whether or not
you plan to attend, we urge you to sign, date and return your Proxy as soon as
possible in the enclosed postage-paid envelope.
Dinner will be served following the meeting and we hope you will be able to
join us. If you intend to join us for dinner, please complete and return the
enclosed reservation card with your Proxy.
We appreciate Your continuing support of CNB Corporation and we encourage you to
recommend the Corporation's services to your friends and neighbors.
We look forward to seeing you at the meeting.
Respectfully,
Robert E. Churchill
President & Chief Executive Officer
Enclosures
<PAGE> 3
CNB CORPORATION
303 North Main Street
Cheboygan, Michigan 49721
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 18, 1999
TO THE SHAREHOLDERS:
The Annual Meeting of Shareholders of CNB Corporation, a Michigan
corporation, will be held on Tuesday, May 18, 1999, at 5:30 p.m., at the Knights
of Columbus Hall, 9840 N. Straits Highway, Cheboygan, Michigan, for the
following purposes:
1. To elect nine directors, each to hold office for a one year term and
until his or her successor is elected and qualified.
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed March 19, 1999, as the record date for
the determination of shareholders entitled to notice of and to vote at the
meeting or any adjournment thereof.
By order of the Board of Directors,
John P. Ward
Secretary
Dated: April 16, 1999
YOUR VOTE IS IMPORTANT. EVEN IF YOU PLAN TO ATTEND THE MEETING, PLEASE
DATE AND SIGN THE ENCLOSED PROXY FORM, INDICATE YOUR CHOICE WITH RESPECT TO THE
MATTERS TO BE VOTED UPON, AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. IF
YOU DO ATTEND THE MEETING, YOU MAY, IF YOU WISH, REVOKE YOUR PROXY AND VOTE YOUR
SHARES IN PERSON. NOTE THAT IF THE STOCK IS HELD IN MORE THAN ONE NAME, ALL
PARTIES MUST SIGN THE PROXY FORM.
<PAGE> 4
CNB CORPORATION
303 North Main Street
Cheboygan, Michigan 49721
PROXY STATEMENT
1999 ANNUAL MEETING OF SHAREHOLDERS
MAY 18, 1999
This Proxy Statement and the enclosed Proxy are furnished in connection
with the solicitation of proxies by the Board of Directors of CNB Corporation
(the "Corporation"), a Michigan bank holding company whose sole subsidiary is
Citizens National Bank of Cheboygan (the "Bank"), to be voted at the Annual
Meeting of Shareholders of the Corporation to be held on May 18, 1999, at 5:30
p.m., at the Knights of Columbus Hall, 9840 South Straits Highway, Cheboygan,
Michigan (the "Annual Meeting"), or at any adjournment or adjournments thereof,
for the purposes set forth in the accompanying Notice of Annual Meeting and in
this Proxy Statement.
VOTING AT THE MEETING
This Proxy Statement has been mailed on or about April 16, 1999, to all
holders of record of common stock of the Corporation as of the record date. The
Board of Directors of the Corporation has fixed the close of business on March
19, 1999, as the record date for the determination of shareholders entitled to
notice of and to vote at the Annual Meeting and any adjournment thereof.
The Corporation's only class of outstanding stock is its common stock,
par value $2.50 per share. There are presently 1,078,741 shares of common stock
of the Corporation outstanding. Each outstanding share will entitle the holder
thereof to one vote on each separate matter presented for vote at the meeting.
Votes cast at the meeting and submitted by proxy are counted by the inspectors
of the meeting who are appointed by the Corporation.
If a Proxy in the enclosed form is properly executed and returned to
the Corporation, the shares represented by the Proxy will be voted at the Annual
Meeting and any adjournment thereof. If a shareholder specifies a choice, the
Proxy will be voted as specified. If no choice is specified, the shares
represented by the Proxy will be voted for the election of all of the nominees
named in this Proxy Statement and in accordance with the judgment of the persons
named as proxies with respect to any other matter which may come before the
meeting or any adjournment thereof.
A Proxy may be revoked before exercise by notifying the Secretary of
the Corporation in writing, or by submitting a Proxy of a later date or
attending the meeting and voting in person. All shareholders are encouraged to
date and sign the enclosed Proxy form, indicate your choice with respect to the
matters to be voted upon, and return it to the Corporation.
<PAGE> 5
ELECTION OF DIRECTORS
The Bylaws of the Corporation provide for a Board of Directors
consisting of a minimum of one and a maximum of seventeen members. The Bylaws
also provide that at each annual meeting the shareholders shall elect directors
to hold office until the succeeding annual meeting. A director shall hold office
for the term for which he or she is elected and until his or her successor is
elected and qualified. Directors must be shareholders.
Nine persons have been nominated for election to the Board, each to
serve one year expiring at the 2000 Annual Meeting of Shareholders. The Board
has nominated Robert E. Churchill, James C. Conboy, Jr., Kathleen M. Darrow,
Thomas J. Ellenberger, Thomas J. Fisher, Vincent J. Hillesheim, John L. Ormsbee,
Francis J. VanAntwerp, Jr. and John P. Ward. All of the nominees are incumbent
directors previously elected by the Corporation's shareholders.
Unless otherwise directed by a shareholder's Proxy, the persons named
as proxy holders in the accompanying Proxy will vote for the nominees named
above. In the event any of such nominees shall become unavailable, which is not
anticipated, the Board of Directors in its discretion may designate substitute
nominees, in which event the enclosed Proxy will be voted for such substitute
nominees. Proxies cannot be voted for a greater number of persons than the
number of nominees named.
A plurality of the votes cast at the meeting is required to elect the
nominees as directors of the Corporation. Shares not voted at the meeting,
whether by abstention, broker non-vote, or otherwise, will not be treated as
votes cast at the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ELECTION OF ALL NOMINEES
AS DIRECTORS.
-2-
<PAGE> 6
INFORMATION ABOUT DIRECTOR NOMINEES
The following table sets forth certain information regarding each
nominee, including name, age, principal occupation for the past five years, and
term of service as a director of the Corporation. The information set forth in
the table is based in part on information provided by each nominee.
<TABLE>
<CAPTION>
=====================================================================================================================
HAS SERVED
AS A DIRECTOR
NAME AND AGE PRINCIPAL OCCUPATION SINCE (1)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Robert E. Churchill, 58 President and Chief Executive Officer of the Corporation. 1983
Chairman of the Board and Chief Executive
of the Bank.
- ---------------------------------------------------------------------------------------------------------------------
James C. Conboy, Jr., 51 Executive Vice President of the Corporation. 1983
President & Chief Operating Officer of the Bank. Former
Attorney/Partner, Bodman, Longley & Dahling LLP.
- ---------------------------------------------------------------------------------------------------------------------
Kathleen M. Darrow, 56 (2) President/Co-owner of Darrow Bros. Excavating, Inc. 1996 (3)
Retired Group Sales & Special Events Coordinator for
the Mackinac State Historic Parks.
- ---------------------------------------------------------------------------------------------------------------------
Thomas J. Ellenberger, 48 (2) Part owner, Vice President and Secretary of Albert 1995 (3)
Ellenberger Lumber Co. (retail lumber sales).
- ---------------------------------------------------------------------------------------------------------------------
Thomas J. Fisher, 69 (2) Chairman of the Board of the Corporation. 1993
Chairman of the Board of North Country Homes
Corporation (residential home builder/dealer).
- ---------------------------------------------------------------------------------------------------------------------
Vincent J. Hillesheim, 48 (2) President of Crusoe's Rivertown Motors, Inc., d/b/a 1994
Anchor In Marina.
President of Lincoln Bridge Plaza, Inc. (commercial
property leases).
- ---------------------------------------------------------------------------------------------------------------------
John L. Ormsbee, 60 (2) Sole proprietor of Jack's Sales (auctioneering services, 1980
logging, and Christmas tree sales).
- ---------------------------------------------------------------------------------------------------------------------
Francis J. VanAntwerp, Jr., President/Owner of Durocher Dock & Dredge, Inc. 1990
54 (2) (marine construction).
President/Owner of Salvor, Ltd. (real estate and
equipment leasing).
- ---------------------------------------------------------------------------------------------------------------------
John P. Ward, 62 (2) Secretary of the Corporation. 1994
Retired Senior Vice President of the Corporation and
Senior Vice President and Cashier of the Bank.
=====================================================================================================================
</TABLE>
(1) Any service as a director prior to 1985, the year the Corporation was
formed, would have been as a director of the Bank. Since 1985, all
directors of the Corporation also have been directors of the Bank.
(2) Member of the Audit Committee.
(3) Service as a director prior to May, 1996 was as a director of the Bank.
-3-
<PAGE> 7
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of the Corporation has an Audit Committee. The
Committee is comprised of directors Darrow, Ellenberger, Fisher, Hillesheim,
Ormsbee, VanAntwerp, and Ward. Five meetings of the Audit Committee were held
during 1998. The Committee is responsible for the recommendation of the
independent accounting firm to be engaged for the external audit, directing and
supervising investigations into matters relating to audit functions, reviewing
with independent auditors the plan and results of the external audit, the
establishment and continued supervision of internal auditing procedures,
reviewing the degree of independence of the auditors, and reviewing the adequacy
of internal accounting controls.
All directors of the Corporation also serve as the Board of Directors
of the Bank. The Board of Directors of the Corporation held a total of six
meetings during 1998, including the organizational meeting and one special
meeting. The Board of Directors of the Bank held a total of twenty-six meetings
during 1998, including the organizational meeting and one special meeting. All
directors attended 75% or more of the aggregate number of meetings of the two
Boards and the Committees on which they served during the year. There are no
family relationships between or among any of the directors, nominees or
executive officers of the Corporation.
COMPENSATION OF DIRECTORS
All directors initially elected prior to January 1, 1994 participate in
the Citizens National Bank of Cheboygan 1985 Directors' Deferred Compensation
Plan in lieu of current payment of director fees. The plan was adopted by the
Bank in 1985 and in 1993 participation in the plan was closed to directors
initially elected after January 1, 1994. The plan provides for retirement and
death benefits to be paid to the participating directors by the Bank over a
minimum of fifteen years. The Bank is the owner and beneficiary of life
insurance policies which are structured to fund the Bank's obligations under the
terms of the plan.
Directors initially elected after January 1, 1994, may participate in
the Citizens National Bank of Cheboygan 1997 Deferred Compensation Plan. The
plan was adopted by the Bank effective September 1, 1997. The plan permits
deferral of all or any portion of current director fees. Amounts deferred are
credited with interest at a rate equal to the Bank's "yield on earning assets"
as calculated at year end of the prior year. Upon separation for any reason of
the services of a participating director from the Bank, the director will be
entitled to receive the balance of his or her account either in a lump sum or in
approximately equal installments over a period of ten years.
-4-
<PAGE> 8
During 1998, directors participating in the 1985 Directors' Deferred
Compensation Plan received a deferred annual retainer of $4,000 for service on
the Board of Directors of the Corporation and the Bank. Directors not eligible
to participate in the 1985 Directors' Deferred Compensation Plan received a
quarterly retainer of $1,750 for service on the two Boards. The chairman of the
board of the Corporation received an additional quarterly retainer of $250.
Directors are not compensated for attendance at Board or Committee meetings, but
are reimbursed for travel expenses for meetings attended.
COMPENSATION OF EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation received by the named
executives for each of the calendar years shown.
<TABLE>
<CAPTION>
======================================================================================================================
ANNUAL COMPENSATION
-----------------------------------------------------------------
NAME AND PRINCIPAL OTHER
POSITION YEAR SALARY BONUS COMPENSATION
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Robert E. Churchill 1998 $138,000 (2) (3) $72,446 $7,305 (4)
President and Chief
Executive Officer
- ---------------------------------------------------------------------------------------------------------------------
1997 $134,000 (2) (3) $58,203 $6,974 (5)
------------------------------------------------------------------------------------------
1996 $129,000 (3) $52,477 $6,318 (6)
------------------------------------------------------------------------------------------
James C. Conboy, Jr. 1998 (1) $ 37,846 (3) $ 5,287 $ 425
Executive Vice
President
======================================================================================================================
</TABLE>
(1) For the period September 1, 1998 to December 31, 1998
(2) Includes compensation deferred under the 1997 Deferred Compensation Plan.
(3) Includes director fees of $4,000 and compensation deferred under 401(k)
Plan.
(4) Includes employer's matching contribution of $5,760 under 401(k) Plan.
(5) Includes employer's matching contribution of $5,474 under 401(k) Plan.
(6) Includes employer's matching contribution of $5,176 under 401(k) Plan.
-5-
<PAGE> 9
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth the options exercised by the named
executives under the CNB Corporation 1996 Stock Option Plan during the fiscal
year ended December 31, 1998 and the value of unexercised options as of such
date.
<TABLE>
<CAPTION>
==============================================================================================================================
NUMBER OF SECURITIES VALUE OF
UNDERLYING UNEXERCISED UNEXERCISED IN-THE-MONEY
OPTIONS AT FISCAL YEAR OPTIONS AT FISCAL YEAR END(3)
END(2)
---------------------------------------------------------------------
SHARES
ACQUIRED VALUE
NAME ON REALIZED
EXERCISE (1) EXERCISABLE UNEXERCIS- EXERCISABLE UNEXERCIS-
ABLE ABLE
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Robert E. Churchill
President and Chief
Executive Officer 1,000 $33,960 2,307 3,000 $77,193 $64,950
- ------------------------------------------------------------------------------------------------------------------------------
James C. Conboy, Jr.
Executive Vice 0 0 0 3,000 0 $ 7,500
President
==============================================================================================================================
</TABLE>
(1) The value realized is based on the difference between the fair market value
of the shares on the date of exercise and the exercise price of the options.
(2) The number of shares underlying exercisable but unexercised options for Mr.
Churchill has been adjusted to reflect two 5% stock dividends.
(3) The value shown is calculated by determining the difference between the fair
market value of the common stock and the exercised price of the options
(adjusted for two 5% stock dividends for Mr. Churchill) at fiscal year end.
For purposes of this table, fair market value is deemed to be $62.50 per
share, the price at which the stock last traded on or before December 31,
1998.
-6-
<PAGE> 10
REPORT ON EXECUTIVE COMPENSATION
The Board of Directors standing Compensation Committee was dissolved in
1998 and the Corporation's compensation program for executive officers is now
administered by the entire Board of Directors. At present, all officers of the
Corporation, with the exception of Mr. Ward, the Corporation's Secretary, are
also officers of the Bank, and although they receive compensation from the Bank
in their capacity as officers of the Bank, they receive no separate cash
compensation from the Corporation. Mr. Ward receives no compensation as
Secretary of the Corporation.
The Board of Directors has developed and implemented compensation plans
which seek to align the financial interests of the Corporation's senior officers
with those of its shareholders. The Corporation's executive compensation program
is comprised of three primary components: base salary, annual cash incentive
bonus opportunities and longer-term incentive opportunities in the form of stock
option awards. Executives also participate in the Bank's 401(k) Savings Plan and
Pension Plan and are eligible to participate in the Bank's 1997 Deferred
Compensation Plan.
To attract and retain officers with exceptional abilities and talent,
annual base salaries are set to provide competitive levels of compensation
recognizing individual performance and achievements. Annual cash incentive
bonuses are used to reward senior officers and other key employees for
individual performance, accomplishments and achievement of annual business
targets. A significant portion of career compensation for senior officers is
linked to corporate performance through stock option awards.
The Board of Directors determines the annual base salary, incentive
bonus and stock option awards for the Chief Executive Officer. Annual base
salary, incentive bonus and stock option awards with respect to the
Corporation's other senior officers are recommended by the Chief Executive
Officer to, and ultimately determined by, the Board of Directors. All
recommendations of the Chief Executive Officer were approved by the Board of
Directors for the most recent calendar year.
In evaluating the performance of and determining the annual base
salary, incentive bonus and stock option awards for the Chief Executive Officer
and other senior management, the Board of Directors takes into account
management's contribution to the long-term success of the Corporation. The Board
of Directors considers return to shareholders to be primary in measuring
financial performance. The mission of the Corporation is to maximize long-term
return to shareholders consistent with its commitments to maintain the safety
and soundness of the Corporation and the Bank and provide the highest possible
service at a fair price to the customers and communities that it serves. The
Board of Directors has taken these subjective and qualitative factors into
account, along with other quantitative measures of corporate performance, in
establishing the annual base salary, incentive bonus and stock option awards for
the Chief Executive Officer and the Corporation's other senior management,
giving at least equal weight to the subjective and qualitative factors and no
particular weight to any given factor. The determination of the size of stock
option awards is based upon a subjective analysis of each recipient's position
within the organization, his or her individual performance and his or her growth
potential within the organization.
-7-
<PAGE> 11
The Board of Directors primarily considers five quantitative measures
of corporate performance in establishing the compensation to be paid to the
Chief Executive Officer and the Corporation's other senior management. These
measures of corporate performance are: (i) after-tax earnings and earnings
growth; (ii) capital position; (iii) quality of the Bank's loan portfolio; (iv)
targeted as compared to actual operating performance; and (v) the Corporation's
performance and financial condition as compared to that of its Federal Reserve
Bank peer group. These measures were considered by the Board of Directors in
determining each component of executive compensation, with particular weight
being given to after-tax earnings and earnings growth. The Board of Directors
also takes into consideration compensation levels at comparable financial
institutions based on various general and targeted compensation surveys of peer
group commercial banks with total assets between $100 and $200 million and
located in the midwest United States and the state of Michigan.
Submitted by the Board of Directors:
Robert E. Churchill James C. Conboy, Jr. Kathleen M. Darrow
Thomas J. Ellenberger Thomas J. Fisher Vincent J. Hillesheim
John L. Ormsbee Francis J. Van Antwerp, Jr. John P. Ward
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain of the directors and officers of the Corporation have had and
are expected to have in the future, transactions with the Bank, or have been
directors or officers of corporations, or members of partnerships, or sole
proprietors of businesses which have had and are expected to have in the future,
transactions with the Bank. In the opinion of management, all such transactions
with officers and directors and with such related businesses are made in the
ordinary course of business and substantially on the same terms, including
interest rates and collateral, as those prevailing at the same time for
comparable transactions with other customers, and these transactions do not
involve more than normal risk of collectibility or present other unfavorable
features.
-8-
<PAGE> 12
OWNERSHIP OF COMMON STOCK
The following table sets forth certain information as of March 19,
1999, with respect to those persons known by the Corporation to be the
beneficial owner of more than five percent (5%) of the Corporation's outstanding
common stock.
<TABLE>
<CAPTION>
===========================================================================================================================
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP(1)
- ---------------------------------------------------------------------------------------------------------------------------
SOLE VOTING SHARED VOTING TOTAL
NAME AND ADDRESS OF AND DISPOSITIVE OR DISPOSITIVE BENEFICIAL PERCENT OF
BENEFICIAL OWNER POWER POWER(2) OWNERSHIP CLASS
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Dessie M. Ormsbee
P.O. Box 5157
Cheboygan, MI 49721 32,204 32,204 64,408 5.97%
===========================================================================================================================
</TABLE>
(1)The numbers of shares stated include shares personally owned of record by
that person and shares which, under applicable regulations, are considered to be
otherwise beneficially owned by that person. Under these regulations, a
beneficial owner of a security includes any person who, directly or indirectly,
through any contract, arrangement, understanding, relationship or otherwise, has
or shares voting power or dispositive power with respect to the security. Voting
power includes the power to vote or direct the voting of the security.
Dispositive power includes the power to dispose or direct the disposition of the
security. A person will also be considered the beneficial owner of a security if
the person has a right to acquire beneficial ownership of the security within
sixty days.
(2)These numbers include shares over which the listed person is legally entitled
to share voting or dispositive power by reason of joint ownership, trust, or
other contract or property right, and shares held by spouses and children over
whom the listed person may have substantial influence by reason of relationship.
-9-
<PAGE> 13
The following table sets forth certain information as of March 19,
1999, as to the common stock of the Corporation owned beneficially by each
director, the executives named in the Summary Compensation Table above, and by
all directors and executive officers of the Corporation as a group.
<TABLE>
<CAPTION>
===========================================================================================================================
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP(1)
- ---------------------------------------------------------------------------------------------------------------------------
SOLE VOTING SHARED VOTING TOTAL
NAME OF AND/OR AND/OR BENEFICIAL PERCENT OF
BENEFICIAL OWNER DISPOSITIVE POWER DISPOSITIVE POWER(2) OWNERSHIP CLASS
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Robert E. Churchill 13,398 13,398(3) 1.24%
James C. Conboy, Jr. 688 5,685 6,373 *
Kathleen M. Darrow 1,400 1,400 *
Thomas J. Ellenberger 1,951 6,454 8,405 *
Thomas J. Fisher 5,027 1,669 6,696 *
Vincent J. Hillesheim 38,739 38,739 3.50%
John L. Ormsbee 11,862 11,862 23,724 2.20%
Francis J. VanAntwerp, Jr. 651 6,210 6,861 *
John P. Ward 4,046 4,046(3) *
All directors and officers
as a group (12 persons) 20,210 89,611 109,821(4) 10.18%
===========================================================================================================================
</TABLE>
*Less than 1%.
(1)The numbers of shares stated include shares personally owned of record by
that person and shares which, under applicable regulations, are considered to be
otherwise beneficially owned by that person. Under these regulations, a
beneficial owner of a security includes any person who, directly or indirectly,
through any contract, arrangement, understanding, relationship or otherwise, has
or shares voting power or dispositive power with respect to the security. Voting
power includes the power to vote or direct the voting of the security.
Dispositive power includes the power to dispose or direct the disposition of the
security. A person will also be considered the beneficial owner of a security if
the person has a right to acquire beneficial ownership of the security within
sixty days.
(2)These numbers include shares over which the listed person is
legally entitled to share voting or dispositive power by reason of joint
ownership, trust, or other contract or property right, and shares held by
spouses and children over whom the listed person may have substantial influence
by reason of relationship.
(3)The amounts shown do not include 5,307 and 1,500 shares that may be acquired
within 60 days by Mr. Churchill and Mr. Ward, respectively, through the exercise
of stock options.
(4)This amount does not include 14,163 shares that may be acquired within 60
days by executive officers of the Corporation through the exercise of stock
options.
-10-
<PAGE> 14
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The firm of Crowe, Chizek and Company, LLP examined and certified the
financial statements of the Corporation and the Bank for the year ended December
31, 1998. Crowe, Chizek and Company, LLP have been the independent public
accountants of the Bank since 1980 and for the Corporation since its formation
in 1985. Pursuant to the recommendation of the Audit Committee, the Board of
Directors has reappointed Crowe, Chizek and Company, LLP as the independent
public accountants of the Corporation and the Bank for the year ending December
31, 1999. A representative of Crowe, Chizek and Company, LLP is not expected to
be at the Annual Meeting of Shareholders.
SHAREHOLDER PROPOSALS
Any shareholder proposal to be considered by the Corporation for
inclusion in the 2000 Annual Meeting of Shareholders proxy materials must comply
with Rule 14a-8 under the Securities Exchange Act of 1934 and be received by the
Corporation no later than December 14, 1999.
OTHER BUSINESS
The Board of Directors is not aware of any matter to be presented for
action at the meeting, other than the matters set forth herein. If any other
business should come before the meeting, or any adjournment thereof, the Proxy
will be voted in respect thereof in accordance with the best judgment of the
persons authorized therein, and discretionary authority to do so is included in
the Proxy. The cost of soliciting proxies will be borne by the Corporation. In
addition to solicitation by mail, officers and other employees of the
Corporation and the Bank may solicit proxies by telephone or in person, without
compensation other than their regular compensation.
The Annual Report of the Corporation for 1998 is included with this
Proxy Statement.
Shareholders are urged to sign and return the enclosed proxy in the
enclosed envelope. A prompt response will be helpful and appreciated.
By order of the Board of Directors
John P. Ward
Secretary
Dated: April 16, 1999
-11-
<PAGE> 15
CNB CORPORATION
303 North Main Street
Cheboygan, Michigan 49721
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
MAY 18, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Kathleen M. Darrow, Thomas J. Fisher,
and F. J. Van Antwerp, Jr., and each of them, as Proxies, each with the power to
appoint his substitute, and hereby authorizes them to represent and to vote, as
designated below, all the shares of common stock of CNB Corporation held of
record by the undersigned on March 19, 1999, at the Annual Meeting of
Shareholders to be held May 18, 1999, and at any adjournment thereof.
1. In the election of nine directors to be elected for terms expiring in 2000:
<TABLE>
<S><C>
- --------------------------------------------------------------------------------------------------
[ ] FOR all nominees listed below (except as [ ] WITHHOLD AUTHORITY to vote for
marked to the contrary below) all nominees listed below
- --------------------------------------------------------------------------------------------------
</TABLE>
(INSTRUCTION: To withhold authority to vote for any individual nominee strike a
line through the nominee's name in the list below.)
Robert E. Churchill Thomas J. Ellenberger John L. Ormsbee
James C. Conboy, Jr. Thomas J. Fisher Francis J. VanAntwerp, Jr.
Kathleen M. Darrow Vincent J. Hillesheim John P. Ward
COMPLETE AND SIGN ON REVERSE
<PAGE> 16
The undersigned shareholder instructs the Proxies to vote as specified
in this Proxy on the matters described in the Proxy Statement dated April 16,
1999. This Proxy, when properly executed, will be voted by the Proxies in the
manner directed herein by the undersigned shareholder. IF NO CHOICE IS
SPECIFIED, THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED IN PROPOSAL 1. BY
EXECUTION OF THIS PROXY, THE UNDERSIGNED SHAREHOLDER CONFERS UPON THE
ABOVE-APPOINTED PROXIES THE DISCRETIONARY AUTHORITY TO VOTE UPON ANY OTHER
MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING, AND REVOKES ANY PRIOR
PROXIES.
The undersigned shareholder acknowledges receipt of the 1998 Annual
Report to Shareholders, and the Notice of Meeting and Proxy Statement, both
dated April 16, 1999.
The giving of this Proxy does not affect the right of the undersigned
shareholder to vote in person should the undersigned shareholder attend the
annual meeting. This Proxy may be revoked at any time before it is voted.
Each shareholder must sign exactly as his/her name appears below. For
shares held jointly, each joint owner must sign. If signing as attorney,
executor, trustee or in some other representative capacity, sign name and give
full title. If a corporation, sign in full corporate name by authorized officer.
If a partnership, sign in partnership name by authorized person. Brokers
executing proxies should indicate in the space below the number of shares with
respect to which authority is conferred by this Proxy if less than all shares
held by such brokers as nominees are to be voted.
The _________ shares represented by this Proxy are registered on our
books as follows:
Date:____________, 1999 ______________________________________
Signature
Brokers-Number of Shares ___________ ______________________________________
Signature
______________________________________
Signature
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY
IN THE ENCLOSED ENVELOPE PROMPTLY.
