[Progress Letterhead]
March 19, 1999
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Progress Financial Corporation. The meeting will be held at the Plymouth Country
Club located at Plymouth and Belvoir Roads, Norristown, Pennsylvania on Tuesday,
April 27, 1999 at 9:00 a.m., Eastern Time. The matters to be considered by
stockholders at the Annual Meeting are described 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 the
meeting 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 will ensure that
your vote is counted if you are unable to attend.
We appreciate your support and interest in Progress Financial Corporation.
Sincerely,
W. Kirk Wycoff
Chairman, President and
Chief Executive Officer
<PAGE>
PROGRESS FINANCIAL CORPORATION
4 Sentry Parkway, Suite 200
P.O. Box 3036
Blue Bell, Pennsylvania 19422-0764
(610) 825-8800
----------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on April 27, 1999
----------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders ("Annual
Meeting") of Progress Financial Corporation (the "Company") will be held at the
Plymouth Country Club located at Plymouth and Belvoir Roads, Norristown,
Pennsylvania on Tuesday, April 27, 1999 at 9:00 a.m., Eastern Time, for the
following purposes, all of which are more completely set forth in the
accompanying Proxy Statement:
(1) To elect four (4) directors for a three-year term and one (1) director
for a one-year term and until their successors are elected and qualified;
(2) To amend the Company's 1993 Stock Incentive Plan to increase the number
of shares authorized under the plan;
(3) To ratify the appointment by the Board of Directors of
PricewaterhouseCoopers L.L.P. as the Company's independent accountants for the
year ending December 31, 1999; and
(4) To transact such other business as may properly come before the meeting
or any adjournment thereof. Management is not aware of any other such business.
The Board of Directors has fixed March 5, 1999 as the voting record date
for the determination of stockholders entitled to notice of and to vote at the
Annual Meeting and at any adjournment thereof. Only those stockholders of record
as of the close of business on that date will be entitled to vote at the Annual
Meeting or at any such adjournment.
A copy of the Company's Annual Report for 1998 is enclosed. The Annual
Report is not to be regarded as proxy solicitation material.
By Order of the Board of Directors
Eric J. Morgan
Corporate Secretary
Blue Bell, Pennsylvania
March 19, 1999
- --------------------------------------------------------------------------------
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. IT IS IMPORTANT THAT
YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN IF YOU PLAN TO
BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING, YOU MAY VOTE
EITHER IN PERSON OR BY PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN WRITING
OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
- --------------------------------------------------------------------------------
<PAGE>
PROXY STATEMENT
----------
PROGRESS FINANCIAL CORPORATION
4 Sentry Parkway, Suite 200
P.O. Box 3036
Blue Bell, Pennsylvania 19422-0764
(610) 825-8800
----------
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 27, 1999
This Proxy Statement is furnished to holders of common stock, $1.00 par
value per share ("Common Stock"), of Progress Financial Corporation (the
"Company"), a Delaware corporation, in connection with the solicitation by and
on behalf of the Board of Directors of the Company to be used at the Annual
Meeting of Stockholders ("Annual Meeting") to be held at the Plymouth Country
Club located at Plymouth and Belvoir Roads, Plymouth, Pennsylvania, on Tuesday,
April 27, 1999 at 9:00 a.m., Eastern Time, and at any adjournment thereof. This
Proxy Statement is first being mailed to stockholders on or about March 19,
1999.
At the Annual Meeting, stockholders will be asked to elect four directors
to serve for three-year terms and one director to serve for a one-year term. G.
Daniel Jones, Paul M. LaNoce, Janet E. Paroo and Kevin J. Silverang, will each
serve for terms expiring at the Company's 2002 Annual Meeting and John E. F.
Corson will serve for a term expiring at the Company's 2000 Annual Meeting. In
addition, stockholders will be asked to amend the Company's 1993 Amended and
Restated Stock Incentive Plan (the "Stock Incentive Plan") to increase the
number of shares authorized under the plan; to ratify the appointment of
PricewaterhouseCoopers L.L.P. as the Company's independent accountants for the
year ending December 31, 1999; and to transact such other business as may
properly come before the meeting and all adjournments thereof.
The 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 "FOR" the nominees for director described herein,
"FOR" the proposal to amend the Stock Incentive Plan, "FOR" the appointment of
PricewaterhouseCoopers L.L.P. as the Company's independent accountants for the
year ending December 31, 1999 and, upon the transaction of such other business
as may properly come before
<PAGE>
the meeting, in accordance with the best judgment of the persons appointed as
proxies. 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 (Attention: Eric J. Morgan, Corporate Secretary, Progress
Financial Corporation, 4 Sentry Parkway, Suite 200, P.O. Box 3036, Blue Bell,
Pennsylvania 19422-0764); (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.
VOTING
Only stockholders of record at the close of business on March 5, 1999 (the
"Voting Record Date") will be entitled to vote at the Annual Meeting. On the
Voting Record Date, there were 5,270,728 shares of Common Stock issued and
outstanding, held by approximately 1,800 holders of record, and the Company had
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 meeting.
The presence in person or by proxy of at least a majority of the
outstanding shares of Common Stock entitled to vote is necessary to constitute a
quorum at the Annual Meeting. The persons receiving the greatest number of votes
of the Common Stock in each class, up to the number of directors to be elected
in such class, shall be elected as directors of the Company. The affirmative
vote of the holders of a majority of the total votes cast at the Annual Meeting
is required for approval of the proposals to amend the Stock Incentive Plan and
to ratify the appointment of the Company's independent auditors.
Abstentions will be counted for purposes of determining the presence of a
quorum at the Annual Meeting. Because of the required votes, abstentions will
not be counted as votes cast for the election of directors and the proposals to
amend the Stock Incentive Plan and to ratify the appointment of the Company's
independent auditors and, thus, will have no effect on the voting of these
proposals. Under rules applicable to broker-dealers, the election of directors
and the other proposals are considered "discretionary" items upon which
brokerage firms may vote in their discretion on behalf of their clients if such
clients have not furnished voting instructions and, thus, there will be no
"broker non-votes" at the Annual Meeting.
2
<PAGE>
INFORMATION WITH RESPECT TO NOMINEES FOR
DIRECTOR AND DIRECTORS WHOSE TERMS CONTINUE
Election of Directors
The Certificate of Incorporation and Bylaws of the Company provide that the
Board of Directors of the Company shall consist of no fewer than seven nor more
than 21 members, the exact number to be fixed from time to time by resolution of
the Board of Directors. The Board of Directors shall be divided into three
classes as nearly equal in number as possible, and that the members of each
class are to be elected for a term of three years and until their successors are
elected and qualified. One class of directors is to be elected annually, and
stockholders of the Company are not permitted to cumulate their votes for the
election of directors. By affirmation vote of a majority of the Board of
Directors, a resolution was adopted which presently fixes the number of members
of the Board at 12.
No nominee for director is related to any other director or executive
officer of the Company by blood, marriage or adoption, and there was no
arrangement or understanding pursuant to which any of the nominees for director
was selected as a nominee. All nominees currently serve as directors of the
Company.
Unless otherwise directed, each proxy executed and returned by a
stockholder will be voted for the election of the five nominees for director
listed below. If any person named as nominee should be unable or unwilling to
stand for election at the time of the Annual Meeting, the proxies will vote for
any replacement nominee or nominees 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.
3
<PAGE>
The following tables present information concerning each nominee for
director and each director whose term continues, including the principal
occupation of such person during at least the past five years, their tenure as a
director of the Company and the number and percent of Common Stock beneficially
owned by such persons as of the Voting Record Date.
Nominees for Director for Three-Year Term Expiring in 2002
<TABLE>
<CAPTION>
Common Stock
Principal Occupation During Director Beneficially Owned as of
Name Age the Past Five Years Since March 5, 1999(1)
---- --- --------------------------- -------- ------------------------
No. %
---------- --
<S> <C> <C> <C> <C>
G. Daniel Jones 47 Managing Director of Jones, Hayward & Lenzi, 1999 3,756(2) --
Business Services, Inc., a professional corporation
of certified public accountants, located in Bala
Cynwyd, Pennsylvania, since 1982.
Paul M. LaNoce 39 President of DAR Industrial Products, Inc., an 1991 38,339(3) --
industrial manufacturer in Philadelphia,
Pennsylvania.
Janet E. Paroo 44 Chief Operating Officer of Global Health Group, 1996 31,610(4) --
Inc., a health care company in West Conshohocken,
Pennsylvania involved with the development and
management of health care facilities, systems and
programs primarily in South East Asia and India
since 1995. Banker for Meridian Bank in
Philadelphia, Pennsylvania from 1986 to 1995.
Kevin J. Silverang 43 Attorney/Shareholder with the law firm of 1999 11,025 --
Buchanan Ingersoll in Philadelphia, Pennsylvania
since December 1997. Former attorney and founding
partner of the law firm, Kaufman, Coren, Ress,
Weidman & Silverang, P.C. in Philadelphia,
Pennsylvania from May 1995 to November 1997.
Previously, he was an attorney and founding partner
of the law firm of Huggler & Silverang in
Philadelphia, Pennsylvania.
</TABLE>
Nominee for Director for One-Year Term Expiring in 2000
<TABLE>
<CAPTION>
Common Stock
Principal Occupation During Director Beneficially Owned as of
Name Age the Past Five Years Since March 5, 1999(1)
---- --- --------------------------- -------- ------------------------
No. %
---------- --
<S> <C> <C> <C> <C>
John E. F. Corson 58 Consultant and President of Corson, Investments, a 1991 15,983(5) --
group of family holding companies in Plymouth
Meeting, Pennsylvania.
The Board of Directors recommends a vote FOR election of the nominees for director.
</TABLE>
4
<PAGE>
Members of the Board of Directors Continuing in Office
Directors With Terms Expiring in 2000
<TABLE>
<CAPTION>
Common Stock
Principal Occupation During Director Beneficially Owned as of
Name Age the Past Five Years Since March 5, 1999(1)
---- --- --------------------------- -------- ------------------------
No. %
---------- --
<S> <C> <C> <C> <C>
A. John May, III 43 Partner in the law firm Pepper, Hamilton LLP 1993 18,345(6) --
in Philadelphia, Pennsylvania
Charles J. Tornetta 68 President of Tornetta Realty Corporation, a 1991 70,834(7) 1.33
real estate broker in Norristown, Pennsylvania.
Also, President of Commonwealth Insurance Agency.
W. Kirk Wycoff 41 Chairman, President and Chief Executive Officer 1991 373,012(8) 8.08
of the Company and the Bank.
</TABLE>
Directors With Terms Expiring in 2001
<TABLE>
<CAPTION>
Common Stock
Principal Occupation During Director Beneficially Owned as of
Name Age the Past Five Years Since March 5, 1999(1)
---- --- --------------------------- -------- ------------------------
No. %
---------- --
<S> <C> <C> <C> <C>
William O. Daggett, Jr. 58 Chairman of the Board of NABCO; Managing 1990 83,775(9) 1.58
Partner of Kistler-Tiffany Companies, a firm
engaged in financial and estate planning and
employee benefits in Wayne, Pennsylvania. Also,
President, Benefit Designs, Inc.; and Vice
President, Group Brokerage Associates, Inc.
H. Wayne Griest 50 President and CEO of Progress Realty 1996 32,886(10) --
Advisors, Inc. since January 1996. Former
President of the Lee Financing Group, Inc. in
Wayne, Pennsylvania from July 1986 until
November 1995.
Joseph R. Klinger 56 Principal of KMR Management, Inc., a management 1992 18,735(11) --
consulting company in Glenside, Pennsylvania.
William L. Mueller 47 Attorney/Partner with the law firm Brandt, 1990 136,951(12) 2.58
Haughey, Penberthy, Lewis & Hyland in
Moorestown, New Jersey since December 1996.
Former attorney with Clark, Ladner, Fortenbaugh
and Young in Cherry Hill, New Jersey from
November 1987 until November 1996.
</TABLE>
5
<PAGE>
- ----------
(1) Unless otherwise indicated, the number of shares owned is less than 1% of
the issued and outstanding Common Stock of the Company.
(2) The indicated shares are held through the 401(k) plan of Jones, Hayward &
Lenzi.
(3) Includes 9,289 shares subject to stock options which are exercisable within
60 days of March 5, 1999.
(4) Includes 4,133 shares subject to stock options which are exercisable within
60 days of March 5, 1999.
(5) Includes 7,714 shares subject to stock options which are exercisable within
60 days of March 5, 1999.
(6) Includes 2,204 shares held jointly by Mr. May with or for the benefit of
certain family members and 4,133 shares subject to stock options, in each
case which are exercisable within 60 days of March 5, 1999.
(7) Includes 27,562 shares subject to warrants to purchase Common Stock
("Common Stock Warrants") and 8,764 shares subject to stock options, in
each case which are exercisable within 60 days of March 5, 1999.
(8) Includes 13,230 shares held jointly by Mr. Wycoff with or for the benefit
of certain family members, 13,781 Common Stock Warrants and 227,115 shares
subject to stock options, in each case which are exercisable within 60 days
of March 5, 1999.
(9) Includes 61,230 shares owned by companies of which Mr. Daggett is a
director, officer and 10% stockholder, 13,781 Common Stock Warrants and
8,764 shares subject to stock options, in each case which are exercisable
within 60 days of March 5, 1999.
(10) Includes 6,448 shares subject to stock options which are exercisable within
60 days of March 5, 1999.
(11) Includes 7,714 shares subject to stock options which are exercisable within
60 days of March 5, 1999.
(12) Includes 101,675 shares held jointly by Mr. Mueller with or for the benefit
of certain family members, 27,562 Common Stock Warrants and 7,714 shares
subject to stock options, in each case which are exercisable within 60 days
of March 5, 1999.
6
<PAGE>
Stockholder Nominations
Nominations for members of the Board of Directors of the Company are made
by the Board of Directors or by any stockholder entitled to vote at the Annual
Meeting. Section 8.4(d) of the Company's Certificate of Incorporation sets forth
the procedures which stockholders must follow in order to make nominations for
election to the Board of Directors. In general, such nominations must be
submitted in writing to the Company at least 30 days prior to the date of the
Annual Meeting. The Company is not required to include such nominations in its
proxy statement. If any stockholder properly makes such a nomination, the
ballots provided for use by stockholders at the Annual Meeting will bear the
name of such nominee or nominees.
The Board of Directors and Its Committees
The Board of Directors of the Company held a total of seven meetings during
the year ended December 31, 1998. No incumbent director attended fewer than 75%
of the aggregate total number of meetings of the Board of Directors held during
the year ended December 31, 1998, and the total number of meetings held by all
committees on which he served during such year, except for Mr. May.
The Board of Directors of the Company has established several committees,
including an Executive Committee and an Audit Committee.
The Audit Committee of the Company recommends to the Board independent
auditors to perform audit and non-audit services, reviews the scope and results
of such services, reviews with management and the independent auditors the
systems of internal control and audit, assures adherence in accounting and
financial reporting to generally accepted accounting principles, and performs
such other duties deemed appropriate by the Board of Directors. The Audit
Committee met four times in 1998. The following Board members served on the
Audit Committee in 1998: William O. Daggett, Jr., Chairman, John E. F. Corson
and Paul LaNoce.
The Executive Committee of the Company has been established to make
decisions on acquisitions, investments, and other Board actions between Board
meetings. This committee also acts as the Compensation, Stock Benefits Plan and
Nominating Committees. For 1998, the following Board members served on the
Executive Committee: Joseph R. Klinger, Chairman, Paul M. LaNoce, William O.
Daggett, Jr., Charles J. Tornetta and W. Kirk Wycoff. Mr. Wycoff does not
participate in the decision making process for his compensation.
7
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table includes, as of the Voting Record Date, certain
information as to the Common Stock beneficially owned by: (i) the only persons
or entities, including any "group" as that term is used in Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended ("1934 Act"), who or which was
known to the Company to be the beneficial owner of more than 5% of the issued
and outstanding Common Stock, other than members of the Board of Directors as
disclosed under "Information with Respect to Nominees for Director and Directors
Whose Terms Continue," (ii) certain executive officers of the Company and all
(iii) directors and executive officers of the Company as a group.
Common Stock
Beneficially
Name and Address of Owned as of
Beneficial Owner March 5, 1999(1)
------------------- -------------------
No. %
------- ----
First Financial Fund, Inc.(2) 331,050 6.3%
Gateway Center Three
100 Mulberry Street, 9th Floor
Newark, New Jersey 07102
Emerald Advisors, Inc (3) 273,877 5.2
1857 William Penn Way
Lancaster, Pennsylvania 17601
Executive Officers:
Michael B. High -- --
George Mark 11,712(4) --
Eric J. Morgan 21,368(5) --
All directors and executive officers 868,331(6) 15.25
of the Company as a group (14 persons)
- ----------
(1) Unless otherwise indicated, the number of shares owned is less than 1% of
the issued and outstanding Common Stock.
(2) Based upon filings under the Exchange Act, First Financial Fund possesses
sole voting power and shares dispositive power for the indicated shares
with Wellington Management Company, LLP, in its capacity as investment
advisor to the First Financial Fund.
(3) Based upon filings under the Exchange Act, Emerald Advisors possesses sole
voting power over 176,754 shares and sole dispositive power over 273,877
shares.
(4) Includes 5,250 shares subject to stock options which are exercisable within
60 days of March 5, 1999.
8
<PAGE>
(5) Includes 15,297 shares subject to stock options which are exercisable
within 60 days of March 5, 1999.
(6) Includes 13,230 shares which are held jointly by Mr. Wycoff with or for the
benefit of certain family members, 61,230 shares which are owned by
companies of which Mr. Daggett is a director, officer or 10% stockholder
and 101,675 shares held jointly by Mr. Mueller with or for the benefit of
certain family members. Also includes 312,335 subject to stock options and
82,686 Common Stock Warrants held by the group, in each case which are
exercisable within 60 days of March 5, 1999.
EXECUTIVE COMPENSATION
Summary
The following table sets forth a summary of certain information concerning
the compensation awarded to or paid by the Company to the following executive
officers of the Company for services rendered in all capacities during the last
three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
====================================================================================================================================
Annual Compensation Long Term Compensation
----------------------------------------- -----------------------
Awards Payouts
Other ---------- --------- All
Name and Annual LTIP Other
Principal Position Year Salary(1) Bonus(2) Compensation(3) Options(4) Payouts(5) Compensation(6)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
W. Kirk Wycoff 1998 $346,400 $79,032 -- -- -- $26,199
Chairman, President and 1997 287,885 60,221 -- 105,000 -- 7,152
Chief Executive Officer 1996 265,000 63,923 -- 37,800 -- 4,751
- ------------------------------------------------------------------------------------------------------------------------------------
H. Wayne Griest(7) 1998 125,000 19,570 -- -- -- 8,241
President and Chief 1997 120,000 9,416 -- 2,625 -- 6,002
Executive Officer of 1996 115,000 5,975 -- 5,250 -- 2,521
Progress Realty Advisors, Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
George Mark(8) 1998 148,308 14,350 -- 15,750 -- 2,967
Executive Vice President 1997 12,519 -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Eric J. Morgan 1998 99,826 9,400 -- -- -- 15,545
Senior Vice President and 1997 99,826 12,297 -- 7,350 -- 5,301
Chief Credit Officer 1996 91,927 15,085 -- 1,175 -- 2,742
- ------------------------------------------------------------------------------------------------------------------------------------
Michael B. High (9) 1998 43,687 8,968 -- 15,000 -- 1,092
Senior Vice President and
Chief Financial Officer
====================================================================================================================================
</TABLE>
(1) Includes amounts deferred pursuant to the Company's 401(k) Profit Sharing
Plan, which generally allows employees to defer up to 12% of their
compensation, subject to applicable limitation set forth in the Internal
Revenue Code.
(2) Bonuses are payable in 1999 based on 1998 performance objectives.
(3) Does not include amounts attributable to miscellaneous benefits received by
executive officers, including the use of Company-owned automobiles. In the
opinion of management of the Company the costs to the Company of providing
such benefits to any individual executive officer during the year ended
December 31, 1998 did not exceed the lesser of $50,000 or 10% of the total
of annual salary and bonus reported for the individual.
(4) Represents options granted pursuant to the Company's Stock Incentive Plan.
9
<PAGE>
(5) The Company did not have a long-term incentive program as of December 31,
1998.
(6) Consists of employer contributions made by the Company pursuant to the
401(k) plan and allocations pursuant to the Company's Employee Stock
Ownership Plan ("ESOP"). Employer contributions pursuant to the Company's
401(k) Plan in 1998 were $4,087, $3,614, $2,967, $2,808 and $1,092,
respectively, for Messrs. Wycoff, Griest, Mark, Morgan and High and
allocations pursuant to the ESOP in 1998 were $22,112, $4,627, $0, $12,737,
and $0, respectively.
(7) Mr. Griest join the Company in January 1996.
(8) Mr. Mark joined the Company in December 1997.
(9) Mr. High joined the Company in October 1998 and the amounts shown represent
compensation paid for a portion of 1998.
Compensation of Directors
Director's Fees. The Board of Directors of the Bank meets monthly and the
Board of the Company meets at least quarterly. Cash compensation is paid to
Directors for attendance at regularly scheduled and special Board meetings. Each
non-officer director receives a fee of $650 for attendance at each regular or
special Board meeting. In addition, each non-officer director receives a fee of
$500 for each Executive and Audit Committee meeting attended and $350 for each
Loan Committee attended.
Directors' Stock Option Plan. The Company maintains the Amended and
Restated 1993 Directors' Stock Option Plan (the "Directors' Plan") which
provides for the grant of compensatory stock options to non-employee directors
of the Company and the Bank. Pursuant to the Directors' Plan, in June 1993 each
director of the Company or the Bank who was not an employee of the Company or
any subsidiary was granted a compensatory stock option to purchase 5,512 shares
of Common Stock, at an exercise price of $3.17 per share. In addition, options
to purchase 275 shares were granted to each non-employee director for each year
from 1993 to 1996 and options to purchase 525 shares were granted in 1997 and
551 shares in 1998 and will also be granted to each non-employee director each
year until December 31, 2007. The exercise price is equal to the fair market
value of a share of Common Stock on the date of grant. Options granted pursuant
to the Directors' Plan are immediately vested and exercisable. Share amounts
have been adjusted for stock dividends on the Common Stock.
Compliance with Section 16 (a) of the Securities Exchange Act
Pursuant to Item 405 of Regulation S-K, the Company is required to disclose
(based solely upon a review of Forms 3 and 4 and amendments thereto furnished to
the Company pursuant to Rule 16a-3(e) during its most recent fiscal year and
Forms 5 and amendments thereto furnished to the Company with respect to its most
recent year) each person who, at any time during the fiscal year, was a
director, executive officer or beneficial owner of more than ten percent of the
Company's Common Stock that failed to file on a timely basis, as disclosed in
the above forms, reports required by Section 16(a) of the Exchange Act during
the most recent fiscal year or prior fiscal years.
10
<PAGE>
Based upon its review of Forms 3, 4 and 5 and amendments thereto furnished
to the Company during and with respect to 1998, the Company is not aware of any
director, officer, beneficial owner or more than 10 percent of the Company's
Common Stock or any other person subject to Section 16 of the Exchange Act who
has failed to file any such form on a timely basis during 1998.
Stock Options
The following table sets forth certain information concerning grants of
stock options awarded to the named executive officers during the year ended
December 31, 1998
Option Grants in Last Fiscal Year
<TABLE>
<CAPTION>
=============================================================================================================
Potential Realizable Value
at Assumed Annual Rates
of Stock Price Appreciation
Individual Grants for Option Term(3)
- -------------------------------------------------------------------------------------------------------------
% of Total
Options Options Granted Exercise Expiration
Name Granted to Employees(1) Price(2) Date 5% 10%
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
W. Kirk Wycoff -- -- -- -- -- --
- -------------------------------------------------------------------------------------------------------------
H. Wayne Griest -- -- -- -- -- --
- -------------------------------------------------------------------------------------------------------------
George Mark 15,750 22.65% $15.71 1/1/08 $155,700 $394,451
- -------------------------------------------------------------------------------------------------------------
Eric J. Morgan -- -- -- -- -- --
- -------------------------------------------------------------------------------------------------------------
Michael B. High 15,000 21.57 13.125 10/1/08 123,814 313,768
=============================================================================================================
</TABLE>
(1) Percentage of options granted to all employees during 1998.
(2) In all cases the exercise price was based on the fair market value of a
share of Common Stock on the date of grant.
(3) Assumes compounded rates of return of 5% and 10% for the remaining life of
the options and future stock prices of $25.59 and $40.75, respectively, for
the options granted to Mr. Mark and future stock prices of $21.38 and
$34.03, respectively, for the options granted to Mr. High.
11
<PAGE>
The following table sets forth certain information concerning exercises of
stock options granted pursuant to the Company's stock option plans by the named
executive officers during the year ended December 31, 1998 and options held at
December 31, 1998.
Aggregated Option Exercise in Last Fiscal Year
and Year End Option Values
<TABLE>
<CAPTION>
====================================================================================================================
Number of Unexercised Value of Unexercised
Shares Options at Year End Options at Year End(1)
Acquired on Value ----------------------------------------------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
W. Kirk Wycoff 21,262 $353,239 199,553 27,562 $1,400,865 $133,271
- --------------------------------------------------------------------------------------------------------------------
H. Wayne Griest -- -- 6,448 1,820 45,292 8,903
- --------------------------------------------------------------------------------------------------------------------
George Mark -- -- -- 15,750 -- --
- --------------------------------------------------------------------------------------------------------------------
Eric J. Morgan -- -- 15,297 10,338 116,391 50,573
- --------------------------------------------------------------------------------------------------------------------
Michael B. High -- -- -- 15,000 -- --
====================================================================================================================
</TABLE>
(1) Based on a per share market price of $12.375 at December 31, 1998.
Compensation Committee Interlocks and Insider Participation
The Executive Committee of the Board of Directors also serves as the
Compensation Committee of the Board of Directors of the Company. During 1998,
the members of the Committee were Messrs. LaNoce, Klinger, Daggett, Tornetta and
Wycoff. No member of the Committee is a current officer or employee of the
Company or the Bank except for Mr. Wycoff, who does not participate in the
decision making process for his compensation. The report of the Committee with
respect to compensation for 1998 for the Chief Executive Officer and all other
executive officers is set forth below.
Report of the Compensation Committee
The Compensation Committee establishes the policy for compensation of
executive officers of the Company. The Committee also serves as the Stock
Benefits Plan Committee which makes awards under the Company's stock benefit
plans and recommends to the Board of Directors changes or additions to the
Company's stock benefit programs. The goals of the Committee are to assist the
Company in attracting and retaining qualified management, motivating executives
to achieve performance goals, rewarding management for outstanding performance
and to ensure that the financial interests of the Company's management and
stockholders are satisfied. The Committee believes that this is best
accomplished though an appropriate mix of competitive base salaries, bonus and
stock incentives.
The Committee considers the following factors among others in determining
base salary levels for executive officers, including the Chief Executive
Officer:
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o The position, the amount of responsibility the executive officer has,
experience and number of years in office.
o Compensation levels of corresponding positions at other thrift
companies and commercial banks of similar size within the MidAtlantic
region.
o The performance of the executive officer during the year.
The Committee grants bonuses to executive officers, including the Chief
Executive Officer, based upon the degree of attainment of specified individual
and Company performance objectives for the year. The Company's performance
objectives include reaching target levels based on return on equity and earnings
per share. The bonus objectives are based on 70% for Company performance and 30%
for individual performance.
The committee reviewed compensation surveys prepared by SNL Securities and
Sheshunoff Bank Services which showed average annual compensation for chief
executive officers in the MidAtlantic states for comparable banks as well as
summary compensation information for specific banks and thrifts comparable in
size and products to the Company. Due to the unique mix of banking and other
businesses conducted by the Company and the leadership qualities required to
manage these functions, the Committee believes that compensation between the
median and the 75th percentile of other bank and thrift institutions is
warranted for Mr. Wycoff. Further, the Committee recognized that the financial
performance of the Company over the past two years has shown growth in earnings
per share and asset size of 33% and 27%, respectively, which is considered to be
excellent performance. The Committee ratified the terms of Mr. Wycoff's
employment agreement, extending the term for an additional year, and increased
the amount of his annual bonus above the amount specified in the bonus formula
by $10,000.
Paul M. LaNoce
Joseph R. Klinger
William O. Daggett, Jr.
Charles J. Tornetta
W. Kirk Wycoff
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Performance Graph
The following graph compares the yearly cumulative total return on the
Common Stock of Progress Financial Corporation over the five year period ending
December 31, 1998 with (i) the yearly cumulative total return on the stocks
included in the Nasdaq Stock Market, Inc. and (ii) the yearly cumulative total
return on the stocks included in the Nasdaq Bank Stocks Index. All of these
cumulative returns are computed assuming the reinvestment of dividends at the
frequency with which dividends were paid during the applicable years. A share of
Common Stock purchased on January 1, 1994 and held until December 31, 1998,
delivered a compounded annual return of 24.4%, including the reinvestment of
dividends.
[GRAPHIC]
In the printed version of the document, a line graph appears which depicts
the following plot points:
Progress Nasdaq Nasdaq
Financial Stock Bank
Corporation Market Stocks
----------- ------- ------
1994 100 100 100
1995 132.39 141.44 148.93
1996 197.8 173.92 196.62
1997 431.29 213.38 329.22
1998 360.76 299.95 326.09
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Employment Agreements
The Company and the Bank (the "Employers") have entered into an employment
agreement with W. Kirk Wycoff which provides for his employment for a period of
three years with provisions for one-year extensions subject to Board approval
unless sooner terminated by death, disability or termination for cause. The
employment contract provides for a base salary, bonus plan, and entitles Mr.
Wycoff to participate in all benefit plans and programs available to executive
officers.
The employment agreement is terminable with or without cause by the
Employers of Mr. Wycoff. Mr. Wycoff shall have no right to compensation or other
benefits pursuant to the employment agreement for any period after voluntary
termination or termination by the Employers for cause, disability, retirement or
death, provided, however, that if the employment agreement is terminated by the
Employers other than for cause, disability, retirement or death or by Mr. Wycoff
following a change in control of the Company, as defined, Mr. Wycoff will be
entitled to a cash severance amount equal to 2.99 times the amount of Mr.
Wycoff's annual compensation.
The change in control is generally defined in the employment agreement to
mean a change in control of a nature that would be required to be reported in
response to Item 6(e) of the SEC proxy rules, provided that a change in control
shall be deemed to have occurred if (i) the acquisition by any person of 25% or
more of the Company's outstanding voting securities, or (ii) during any two-year
period a change in a majority of the directors of the Company has occurred
without the approval of at least two-thirds of the persons who were directors of
the Company at the beginning of such period.
The Company has entered into change in control and termination agreements
with certain executive officers of the Company, including Messrs. Griest, Morgan
and High, in order to induce the executives to remain in the employ of the
Company and to assist the Company in maintaining a stable and competent
management base. The agreements are for a five-year term and provide for
payments to the executives upon involuntary termination of the executive or the
occurrence of other specified events related to a reduction in position,
compensation or benefits following a "change in control" of the Company. Under
the agreements, upon a change in control of the Company followed by termination,
the executive would be entitled to the payment of: (i) two times the executive's
highest base salary and annual cash bonus during the last two years in the case
of Messrs. Morgan and High (one times the highest base salary and annual cash
bonus during the last two years in the case of Mr. Griest), (ii) life, medical
and dental benefits for a period of 24 months equivalent to benefits they would
have received if they remained with the Company in the case of Messrs. Morgan
and High (life, medical and dental benefits for a period of 12 months in the
case of Mr. Griest) , and (iii) outplacement services for a period of 12 months.
The present value of the total amount of payments under the agreements, when
aggregated with any other payments to the executive which constitute parachute
payments under Section 280G of the Internal Revenue Code of 1986, may not exceed
2.99 times the executive's base amount as determined under Section 280G.
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<PAGE>
Indebtedness of Management
The Bank offers certain loans to its directors, officers and employees. It
is the belief of management that these loans do not involve more than the normal
risk of collectibility. Except for the waiving in most cases of loan origination
fees for officers and employees during their employment or association with the
Bank, these loans are made on substantially the same terms as those prevailing
at the time for comparable transactions with nonaffiliated persons. Executive
officers, directors, officers and employees of the Bank receive no discount from
the market interest rate for loans made by the Bank. As of December 31, 1998, 16
loans totaling $3.3 million (or 8.0% of the Company's total stockholders'
equity) were outstanding to the Company's directors and executive officers as a
group. During 1998, no director or executive officer of the Company or the Bank
had loans outstanding at preferred interest rates which aggregated $60,000 or
more.
PROPOSAL TO AMEND THE 1993 STOCK INCENTIVE PLAN TO INCREASE
THE NUMBER OF AUTHORIZED SHARES TO BE ISSUED UNDER THE PLAN
At the Annual Meeting, stockholders will be asked to consider and approve a
proposal to amend the 1993 Stock Incentive Plan to increase the number of
authorized shares to be issued under the Plan. Such amendment was unanimously
approved by the Board of Directors of the Company.
Description of the Amendment
The Company maintains the Stock Incentive Plan, which provides for the
grant of stock options and stock appreciation rights to officers and employees
of the Company. The number of shares of Common Stock currently reserved for
issuance under the Stock Incentive Plan is 475,507, of which approximately
10,000 shares remain available for issuance to date. As a result, the Board of
Directors recently amended the Stock Incentive Plan to increase the total number
of shares of Common Stock reserved for issuance upon exercise of awards granted
under the Stock Incentive Plan by 100,000 from 475,507 to 575,507.
The Stock Incentive Plan is designed to attract and retain qualified
personnel in key positions, provide officers, and key employees with a
proprietary interest in the Company as an incentive to contribute to the success
of the Company and to reward key employees for outstanding performance and the
attainment of targeted goals. The Stock Incentive Plan provides for the grant of
incentive stock options intended to comply with the requirements of Section 422
of the Internal Revenue Code of 1986, as amended (the "Code") ("incentive stock
options"), non-qualified or compensatory stock options and stock appreciation
rights (collectively "Awards"). Awards are available for grant to officers and
key employees of the Company and any subsidiaries.
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<PAGE>
Description of the Amended and Restated 1993 Stock Incentive Plan
The following description of the Stock Incentive Plan is a summary of its
terms and is qualified in its entirety by reference to the Stock Incentive Plan.
Administration. The Stock Incentive Plan is administered and interpreted by
a committee of the Board of Directors ("Committee") that is composed solely of
two or more non-employee directors.
Number of Shares Covered by the Stock Incentive Plan. A total of 575,507
shares of Common Stock has been reserved for issuance pursuant to the Stock
Incentive Plan. In the event of a stock split, reverse stock split or stock
dividend, the number of shares of Common Stock under the Stock Incentive Plan,
the number of shares to which any Award relates and the exercise price per share
under any option or stock appreciation right shall be adjusted to reflect such
increase or decrease in the total number of shares of Common Stock outstanding.
Stock Options. Under the Stock Incentive Plan, the Board of Directors or
the Committee determines which officers and key employees will be granted
options, whether such options will be incentive or compensatory options, the
number of shares subject to each option, whether such options may be exercised
by delivering other shares of Common Stock and when such options become
exercisable. The per share exercise price of an incentive stock option shall be
not less than the fair market value of a share of Common Stock on the date the
option is granted, and the per share exercise price of a compensatory stock
option shall at least equal the greater of par value or 85% of the fair market
value of a share of Common Stock on the date the option is granted.
Stock options shall become vested and exercisable in the manner specified
by the Board or the Committee, provided that all outstanding stock options (as
well as stock appreciation rights) will become immediately vested and
exercisable if there is a "change in control" or a "threatened change in
control" of the Company, as defined in the Stock Incentive Plan.
Each stock option or portion thereof shall be exercisable at any time on or
after it vests and is exercisable until the earlier of ten years after its date
of grant or three months after the date on which the optionee's employment
terminates, unless extended by the Board or the Committee to a period not to
exceed five years from such termination. However, failure to exercise incentive
stock options within three months after the date on which the optionee's
employment terminates may result in adverse tax consequences to the optionee. If
an optionee dies while serving as an employee or terminates his service as a
result of disability or retirement without having fully exercised his options,
the optionee's executors, administrators, legatees or distributes of his estate
shall have the right to exercise such options during the twelve-month period
following the earlier of his death or termination due to disability or
retirement, provided no option will be exercisable more than ten years from the
date it was granted. Stock options are non-transferable except by will or the
laws of descent and distribution. Notwithstanding the foregoing, an optionee who
holds non-qualified options may transfer such options to his or her spouse,
lineal ascendents, lineal descendants, or to
17
<PAGE>
a duly established trust for the benefit or one or more of these lineal
descendants, or to a duly established for the benefit or one or more of these
individuals. Options so transferred may thereafter be transferred only to the
optionee who originally received the grant or to an individual or trust to whom
the optionee could have initially transferred the option. Options which are so
transferred shall be exercisable by the transferee according to the same terms
and conditions as applied to the optionee.
Stock Appreciation Rights. Under the Stock Incentive Plan, the Board of
Directors or the Committee is authorized to grant stock appreciation rights to
optionees under which an optionee may surrender any exercisable incentive stock
option or compensatory stock option or any portion thereof in return for payment
by the Company to the optionee of cash or Common Stock in an amount equal to the
excess of the fair market value of the shares of Common Stock subject to option,
or portion thereof, at the time over the exercise price of the option with
respect to such shares, or a combination of cash and Common Stock. Stock
appreciation rights which relate to incentive stock options must be granted
concurrently with the incentive stock options, while stock appreciation rights
which relate to compensatory stock options may be granted concurrently with the
option or at any time thereafter which is prior to the exercise or expiration of
such options.
Amendment and Termination of the Stock Incentive Plan. The Stock Incentive
Plan became effective in 1993 upon adoption by the Board and the stockholders of
the Company. The Stock Incentive Plan shall remain in effect for a period of ten
years from the effective date of the plan. The Board may at any time terminate
or amend the Stock Incentive Plan with respect to any shares of Common Stock as
to which Awards have not been granted. Termination of the Stock Incentive Plan
shall not affect any previously granted Awards.
Federal Income Tax Consequences. Under current provisions of the Internal
Revenue Code, the federal income tax treatment of incentive stock options and
compensatory stock options is substantially different. With regard to incentive
stock options, an optionee who does not dispose of the shares within two years
after the option was granted, or within one year after the option was exercised,
will not recognize income at the time the option is exercised, and no federal
income tax deduction will be available to the Company at any time as a result of
such grant or exercise. However, the excess of the fair market value of the
stock subject to an incentive stock option on the date such option is exercised
over the exercise price of the option will be treated as an item of tax
preference in the year of exercise for purposes of the alternative minimum tax.
If stock acquired pursuant to an incentive stock option is disposed of before
the holding periods described above expire, then the excess of the fair market
value (but not in excess of the sales proceeds) of such stock on the option
exercise date over the option exercise price will be treated as compensation
income to the optionee in the year in which such disposition occurs, and, if it
complies with applicable withholding requirements, the Company will be entitled
to a commensurate income tax deduction. If the holding periods are satisfied,
any difference between the sales proceeds and the fair market value of the stock
on the option exercise date will be treated as long-term capital gain or loss.
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<PAGE>
With respect to compensatory stock options, the difference between the fair
market value of Common Stock on the date of exercise and the option exercise
price generally will be treated as compensation income upon exercise, and the
Company will be entitled to a deduction in the amount of income so recognized by
the optionee. Upon a subsequent disposition of the shares, the difference
between the amount received by the optionee and the fair market value on the
option exercise date will be treated as long or short-term capital gain or loss,
depending on whether the shares were held for more than one year.
No federal income tax consequences are incurred by the Company or the
holder at the time a stock appreciation right is granted. However, upon the
exercise of a stock appreciation right, the holder will realize income for
federal income tax purposes equal to the amount received by him, whether in
cash, shares of stock or both, and the Company will be entitled to a deduction
for federal income tax purposes at the same time and in the same amount.
The above description of tax consequences is necessarily general in nature
and does not purport to be complete. Moreover, statutory provisions are subject
to change, as are their interpretations, and their application may vary in
individual circumstances. Finally, the consequences under applicable state and
local income tax laws may not be the same as under the federal income tax laws.
Accounting Treatment. Stock appreciation rights will, in most cases,
require a charge against the earnings of the Company each year representing
appreciation in the value of such rights over periods in which they become
exercisable. Such charge is based on the difference between the exercise price
specified in the related option and the current market price of the Common
Stock. In the event of a decline in the market price of the Common Stock
subsequent to a charge against earnings related to the estimated costs of stock
appreciation rights, a reversal of prior charges is made in the amount of such
decline (but not to exceed aggregate prior charges).
Neither the grant nor the exercise of an incentive stock option or a
non-qualified stock option under the Stock Incentive Plan currently requires any
charge against earnings under generally accepted accounting principles.
Statement of Financial Accounting Standards No. 123 ("SFAS No. 123"),
"Accounting for Stock-Based Compensation," establishes financial accounting and
reporting standards for stock-based employee compensation. This Statement
defines a fair market value method of accounting for an employee stock option or
similar equity instrument and encourages all entities to adopt that method of
accounting for all of their employee stock compensation plans. However, it also
allows an entity to continue to measure compensation cost for those plans using
the intrinsic value method of accounting prescribed by APB Opinion No. 25,
"Accounting for Stock Issued to Employees." Under the fair value method,
compensation cost is measured at the grant date based on the value of the award
and is recognized over the service period, which is usually the vesting period.
Under the intrinsic value method, compensation cost is the excess, if any, of
the quoted market price of the stock at grant date or other measurement date
over the amount an employee must pay to acquire the stock. The Company uses the
intrinsic value method, whereby pro forma disclosure is included in the
footnotes to the Company's financial statements to show what
19
<PAGE>
net income and earnings per share would have been if the fair value method had
been utilized. If the Company elects to utilize the fair value method, its net
income and earnings per share may be adversely affected.
Stockholder Approval. No awards will be granted under the Stock Incentive
Plan for issuance in excess of the 475,507 shares of Common Stock currently
authorized under the Stock Incentive Plan unless the amendment is approved by
stockholders. Stockholder ratification of the amendment will also satisfy
listing requirements of the Nasdaq Stock Market and federal tax requirements.
The Board of Directors recommends that stockholders vote FOR adoption of
the amendment to the 1993 Stock Incentive Plan.
PROPOSAL TO RATIFY APPOINTMENT OF THE INDEPENDENT ACCOUNTANTS
The Board of Directors of the Company has appointed PricewaterhouseCoopers
L.L.P., independent accountants, to perform the audit of the Company's financial
statements for the year ending December 31, 1999, and further directed that the
selection of auditors be submitted for ratification by the stockholders at the
Annual Meeting.
The Company has been advised by PricewaterhouseCoopers L.L.P. that neither
that firm nor any of its associates has any relationship with the Company other
than the usual relationship that exists between independent certified public
accountants and clients. PricewaterhouseCoopers L.L.P. will have one or more
representatives at the Annual Meeting who will have an opportunity to make a
statement, if they so desire, and will be available to respond to appropriate
questions.
The Board of Directors recommends that you vote FOR the ratification of the
appointment of PricewaterhouseCoopers L.L.P. as independent auditors for the
year ending December 31, 1999.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have included in the proxy
materials of the Company relating to the next annual meeting of stockholders of
the Company, which is scheduled to be held in April 2000, must be received at
the principal executive offices of the Company, 4 Sentry Parkway, Suite 200,
P.O. Box 3036, Blue Bell, Pennsylvania 19422-0764, Attention: Eric J. Morgan,
Corporate Secretary, no later than November 20, 1999. If such proposal is in
compliance with all of the requirements of Rule 14a-8 under the 1934 Act, it
will be included in the proxy statement and set forth on the form of proxy
issued for such annual meeting of stockholders. It is urged that any such
proposals be sent certified mail, return receipt requested.
20
<PAGE>
Stockholder proposals which are not submitted for inclusion in the
Company's proxy materials pursuant to Rule 14a-8 under the 1934 Act may be
brought before an annual meeting pursuant to Section 8.9 of the Company's
Certificate of Incorporation, which provides that business at an annual meeting
of stockholders must be (a) specified in the notice of meeting (or any
supplement thereto) given by or at the direction of the Board of Directors, or
(b) otherwise properly brought before the meeting by a stockholder. For business
to be properly brought before an annual meeting by a stockholder, the
stockholder must have given timely notice thereof in writing to the Secretary of
the Company. To be timely, a stockholder's notice must be delivered to or mailed
and received at the principal executive offices of the Company not less than 30
days prior to the annual meeting. A stockholder's notice must set forth as to
each matter the stockholder proposes to bring before an annual meeting (a) a
brief description of the business desired to be brought before the annual
meeting and the reasons for conducting such business at the annual meeting, (b)
the name and address, as they appear on the Company's books, of the stockholder
proposing such business and any other stockholders known by the stockholder to
be supporting such proposal, (c) the class and number of shares of Common Stock
of the Company which are beneficially owned by the stockholder, and by any other
stockholders known by the stockholder to be supporting such proposal and (d) any
financial interest of the stockholder in such business.
ANNUAL REPORTS
A copy of the Company's Annual Report to Stockholders for the year ended
December 31, 1998 accompanies this Proxy Statement. Such annual report is not
part of the proxy solicitation materials.
Upon receipt of a written request, the Company will furnish to any
stockholder without charge a copy of the Company's Annual Report on Form 10-K
required to be filed with the Securities and Exchange Commission under the 1934
Act. Such written requests should be directed to Patricia Ellick, Director of
Investor Relations, Progress Financial Corporation, 4 Sentry Parkway, Suite 200,
P.O. Box 3036, Blue Bell, Pennsylvania 19422-0764. The Form 10-K is not part of
the proxy solicitation materials.
OTHER MATTERS
Management is not aware of any business to come before the Annual Meeting
other than the matters described above in this Proxy Statement. However, if any
other matters should properly come before the meeting, it is intended that the
proxies solicited hereby will be voted with respect to those other matters in
accordance with the judgment of the persons voting the proxies.
The cost of the 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 the proxy
materials to the beneficial owners of the Company's 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.
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<PAGE>
PROXY
PROGRESS FINANCIAL CORPORATION
4 Sentry Parkway, Suite 200
P.O. Box 3036
Blue Bell, PA 19422-0764
THIS PROXY IS SOLIClTED ON BEHALF OF THE DIRECTORS OF PROGRESS FINANCIAL
CORPORATION FOR USE ONLY AT AN ANNUAL MEETING OF STOCKHOLDERS TO BE HELD
APRIL 27, 1999 AND AT ANY ADJOURNMENT THEREOF.
The undersigned being a stockholder of the Company, hereby appoints Eric J.
Morgan as proxy, with full power of substitution, to represent the undersigned
at the Annual Meeting of Stockholders of the Company to be held at Plymouth
Country Club, Plymouth and Belvoir Roads, Norristown, Pennsylvania on Tuesday,
April 27, 1999 at 9:00 a.m., and at any adjournment of the said meeting, and
thereat to act with respect to all votes that the undersigned would be entitled
to cast, if then personally present, on the following matters and in their
discretion upon such other matters as may properly come before the meeting.
(To be Signed on Reverse Side)
|X| Please mark your
votes as in this
example.
1. ELECTION OF 4 DIRECTORS FOR A 3-YEAR TERM AND 1 DIRECTOR FOR A
1 YEAR TERM.
FOR
WITHHOLD AUTHORITY
all the
nominees
listed below
to vote for
the nominees
listed below
(except as marked to the contrary)
(INSTRUCTION: To withhold authority to vote for any individual nominee, strike a
line through the nominee's name in the list below.)
3 year term: G. Daniel Jones, Paul M. LaNoce, Janet E. Paroo, Kevin J. Silverang
1 year term: John E. F. Corson
FOR
AGAINST
ABSTAIN
2. To amend the 1993 Stock Incentive Plan to increase the shares authorized
under the Plan.
3. To ratify the appointment of PricewaterhouseCoopers L.L.P. as the Company's
independent accountants for the year ending December 31, 1999.
4. To transact such other business as may properly come before the meeting and
all adjournments thereof.
This Proxy when properly executed will be voted in the manner directed herein by
the undersigned shareholder. If not otherwise specified, this Proxy will be
voted "FOR" Proposals 1, 2 and 3 and otherwise at the discretion of the proxies
with respect to any other business which may properly come before the meeting or
any adjournment voted at the annual meeting.
SIGNATURE(S)_____________________________ DATE_________________
Please sign exactly as your name appears hereon. When signing as attorney,
executor, administrator, trustee, guardian, or in any other representative
capacity, please so indicate.
