<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 /X/ Confirming Copy
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
First Community Bancorp, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
First Community Bancorp, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/ / $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
/X/ 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: $125
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.: Schedule 14A
- --------------------------------------------------------------------------------
(3) Filing party: First Community Bancorp, Inc.
- --------------------------------------------------------------------------------
(4) Date filed: March 30, 1995 Via Paper
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<PAGE> 2
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
OF
1ST COMMUNITY BANCORP, INC.
TO BE HELD ON APRIL 27, 1995
109 East Division
Sparta, Michigan 49345
Telephone: (616) 887-7366
General Information
This Proxy Statement is being furnished to holders of common
stock, $10.00 par value per share, of 1st Community Bancorp, Inc. (the
"Corporation"), in connection with a proxy solicitation by the Corporation's
Board of Directors for use at the Annual Meeting of Shareholders of the
Corporation to be held on April 27, 1995 (the "Annual Meeting"), and any
adjournment thereof. The Annual Meeting will be held at Cleo's Banquet Room,
5225 Alpine, N.W., Grand Rapids, Michigan, at 7:30 p.m. Eastern Standard time.
The first date on which proxy materials are being mailed or given to
shareholders is on or about April 5, 1995.
Purposes of the Annual Meeting
The purposes of the Annual Meeting are to elect directors, to
approve the Board of Directors' selection of accountants for the Corporation's
current fiscal year, and to consider all other business that may properly come
before the Annual Meeting and any adjournment thereof.
Voting by Proxy
If a Proxy in the form distributed by the Corporation is
properly executed and returned, the shares represented by that Proxy will be
voted at the Annual Meeting and at any adjournment thereof. If a shareholder
designates a particular choice, the Proxy will be voted in accordance with that
choice. If no specific choice is made, the shares represented by the Proxy
will be voted "for" the election of all nominees as directors, and "for" the
approval of management's selection of accountants for the Corporation's current
fiscal year. The Corporation's management is unaware of any other business to
be presented at the Annual Meeting, but if other business is presented the
Proxy will be voted in accordance with the recommendations of the Corporation's
management.
Any shareholder who submits a Proxy has the right to revoke it
at any time before it is exercised by delivering a written notice of revocation
to the Secretary of the Corporation at the Corporation's main office or by
orally revoking it at the Annual Meeting. Therefore, signing and returning the
Proxy will
<PAGE> 3
not affect a shareholder's right to attend the Annual Meeting and vote in
person.
Solicitation of Proxies
The Board of Directors is soliciting proxies for the Annual
Meeting by mailing these proxy materials to all of the Corporation's current
shareholders. Additionally, Proxies may be solicited personally, by telephone,
telegram or otherwise, by officers, directors and employees of the Corporation,
without special compensation for such solicitations.
Election of Directors
The Bylaws of the Corporation provide that there shall not be
less than nine (9) nor more than fifteen (15) directors. The Articles of
Incorporation provide that the Board of Directors shall be divided into three
(3) classes with the term of one (1) class expiring each year. At its August
15, 1990 meeting, the Board of Directors, acting under the Articles of
Incorporation and Bylaws of the Corporation, increased the number of members of
the Corporation's Board of Directors from eleven (11) to thirteen (13). One
new position was created in Class II and one new position was created in Class
III.
The Corporation amended its Bylaws at the September, 1993
meeting of the Board of Directors. The amendment increased the number of
consecutive three (3) year terms that a Corporation Board member may serve from
three (3) to five (5). The Board of Directors of the Bank adopted a similar
Bylaw amendment by increasing the number of consecutive one (1) year terms that
a Bank Board member may serve from ten (10) to fifteen (15). An individual who
has served for five (5) consecutive three (3) year terms in the case of the
Corporation or fifteen (15) consecutive one (1) year terms in the case of the
Bank will not be eligible again for a period of three (3) years.
The Board of Directors of the Corporation and Bank accepted
the resignation of Marvin J. Besteman effective October 1, 1994, as President
and Chief Executive Officer. He will no longer serve as a director of the
Corporation or the Bank. Linda R. Pitsch was appointed at the December 14,
1994 Board of Directors Meetings of the Corporation and the Bank to fill the
vacancy in Class III directors which resulted from the resignation on October
1, 1994 of Marvin J. Besteman. Jae M. Maxfield was appointed at the January
11, 1995 Board of Directors Meetings of the Corporation and the Bank to fill
the vacancy which existed in Class III directors with their respective terms
expiring at the 1996 Annual Meetings of the Corporation and the Bank.
Effective February 20, 1995, Mary Jean Herwaldt reached mandatory retirement
age as established in the Bylaws and, therefore, no longer serves as Director
or Secretary of the Corporation or the Bank, leaving a vacancy in Class III
directors.
2
<PAGE> 4
After the election of Class II directors at the Annual Meeting
of Shareholders on April 27, 1995, there will be eleven (11) members of the
Board of Directors. Two (2) vacancies will exist on the Board. The Board of
Directors may elect to fill one or both of these vacancies pursuant to the
authority granted by the Articles of Incorporation.
The Board of Directors has nominated the following four
(4) persons for election as Class II directors to the Corporation's Board of
Directors at the Annual Meeting:
Lawrence D. Bradford
Lewis G. Emmons
Frank G. Berris
Stuart Goodfellow
All of the nominees are presently members of the Corporation's
Board of Directors. Class II Directors are to be elected at the Annual Meeting
to serve a three (3) year term ending at the Annual Meeting of Shareholders in
1998, and until their successors are elected and qualify, or until their
resignation or removal. The nominees have expressed a willingness to be
elected and to serve as members of the Board of Directors. In the event that
any of the nominees are unable to serve or are otherwise unavailable for
election, events which management does not anticipate, the incumbent Board of
Directors of the Corporation may select a substitute nominee. If a substitute
nominee is selected, all proxies will be voted for the nominee selected. If a
substitute is not selected, all proxies will be voted for the election of the
remaining nominees. Proxies will not be voted for a greater number of nominees
than are named above.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR THE ELECTION OF ALL NOMINEES AS DIRECTORS.
Directors and Executive Officers
The Corporation's Board of Directors has thirteen (13)
authorized positions, of which eleven (11) positions are currently occupied.
All of the members of the Corporation's Board of Directors also serve as
Directors of the Bank. The Corporation's Articles of Incorporation provide for
the election of Directors in three (3) classes. Approximately one-third (1/3)
of the Directors are elected annually to serve for a term of three (3) years.
The following information describes each nominee and each
director continuing to serve, including their name, age, principal occupation,
the year in which they first became a director of the Corporation,
directorships in other business corporations, committees of the Corporation and
the Bank that they serve on, and the number of shares of the Corporation's
Common Stock beneficially owned by them and by all directors and officers as a
group and the percentage of such shares to the total shares outstanding on
December 31, 1994 (see Notes (1) and (2)).
3
<PAGE> 5
Directors
Nominees for Election to the Board
of Directors as Class II Directors
for a Three Year Term Expiring at the Annual
Meeting of Shareholders in April, 1998
Lawrence D. Bradford, 55, Independent Insurance Agent and part-owner of
Bradford Insurance Centre, Ltd.; joined the Corporation's Board of Directors in
1986; served as a Director of the Bank from 1974 to the present; serves as
Chairman of the Corporation's and the Bank's Personnel/Compensation Committee
and as a member of the Executive Committee and Ad Hoc Committee of the
Corporation and the Bank.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 723(4)
Lewis G. Emmons, 50, President and a Director of Emmons Development-Real
Estate, Special Projects Coordinator for Great Day Food Stores; joined the
Corporation's Board of Directors in 1986; served as a Director of the Bank from
1978 to the present; serves as a member of the Corporation's and the Bank's
Personnel/Compensation Committee, and Pension Plan Administration Committee.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 3866(3)(4) 1.0%
Frank G. Berris, 47, President and Owner of American Gas & Oil, Inc., Past
President of West Michigan Oilman's Club, Member of Michigan Petroleum
Association, American Quarter Horse Association, Michigan Quarter Horse
Association and the Michigan Association of Convenience Stores; joined the
Corporation's and the Bank's Board of Directors in 1991; serves as a member of
the Corporation's and Bank's Audit, Investment and Asset Liability Committees.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 961
Stuart Goodfellow, 51, Owner of Goodfellow Blueberry Farms and Goodfellow
Vending Services; past Vice President and Director of the Michigan Blueberry
Growers Association; joined the Corporation's and the Bank's Board of Directors
in 1991; serves as a member of the Corporation's and Bank's
Personnel/Compensation, Investment, and Asset Liability Committee and Audit
Committees.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 4535(4) 1.1%
4
<PAGE> 6
Class III Directors
Members of the Board of Directors Whose
Terms Expire at the Annual Meeting
of Shareholders in April, 1996
Jae M. Maxfield, 49, Director, President and CEO of the Corporation and Bank
since January 11, 1995. Mr. Maxfield previously served from 1974 to 1993 as
President and CEO of the Society Bank in Monroe, Michigan, formerly a
subsidiary of First of America Bank, and known initially as Erie State Bank.
From 1993 through January 10, 1995, Mr. Maxfield operated Maxfield Associates,
an association of financial advisors engaged in providing financial services to
business and professional occupations. Mr. Maxfield remains the owner of
Maxfield Associates. Mr. Maxfield also serves as a Director of West Shore
Computer Services, Inc. of Scottville, Michigan and previously served as
Chairman of Monroe County Chamber of Commerce Board of Directors, Monroe County
Industrial Development Board of Directors, Monroe Downtown Development
Authority, Monroe County Strategic Planning Symposium, Monroe County Community
Foundation Board of Directors Strategic Planning Committee and served on the
Monroe County Center for the Arts Advisory Board and Frenchtown Industrial Park
Advisory Board. Mr. Maxfield was an instructor for Monroe County Community
College and served on their Curriculum Advisory Committee.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . None
Linda R. Pitsch, 47, Sr. Vice President and Cashier of Sparta State Bank.
Serves as director of the Corporation and the Bank since December 14, 1994 and
as Secretary of Corporation and Bank as of February 20, 1995. Mrs. Pitsch has
been an employee of Sparta State Bank since September 1969. Mrs. Pitsch serves
as Director and President of the Grand Rapids Chapter of the American Institute
of Banking, Instructor at Davenport College of Business and serves on its
Accounting Advisory Board. Mrs. Pitsch is a member of the Village of Sparta
Board of Appeals and acts as a business consultant to the Junior Achievement
Class at Sparta Area Schools.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 297
Jon E. Pike, 53, Certified Public Accountant and Managing Partner of Beene,
Garter & Co., CPAs, Grand Rapids, Michigan; appointed to the Corporation's and
the Bank's Board of Directors in September, 1990 to fill the vacancy in Class
III directors; serves as a Director of Wm. A. Rogers & Co., a retail hardware
business in Sparta, Michigan and President and Director of B.G. Systems, Inc.,
a computer software business affiliated with Beene, Garter & Co., both of which
are for-profit entities; serves as a Director of Celebration on the Grand, of
Grand Rapids, Michigan, and as a director of Denver Seminary, of Denver,
Colorado, both of which are non-profit corporations; serves as Chairman of the
Corporation's and the Bank's Audit Committee and as a member of the
Corporation's and Bank's Pension Plan Administrative, and Ad Hoc Committees.
5
<PAGE> 7
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 687(4)
Class I Directors
Members of the Board of Directors
Continuing in Office Whose Terms Expire
at the Annual Meeting of Shareholders in April, 1997
L. Edmond Eary, Jr., M.D., 66, Medical Doctor, retired solo practitioner,
served as an Associate Professor of Family Practice, College of Human Medicine,
Michigan State University until June 30, 1988; joined the Corporation's Board
of Directors in 1986; Director of the Bank from 1969 to the present and
Vice-Chairman of the Board of Directors of the Corporation and the Bank from
May 16, 1990 to May 15, 1991, Chairman of the Board of Directors for the
Corporation and the Bank from May 15, 1991 to the present; Director of
Northwest Ambulance Corp., a non-profit corporation and a Past President,
Director and Treasurer of the Michigan Academy of Family Physicians; serves as
a member of the Corporation's and the Bank's Ad Hoc, Investment, and
Asset/Liability Committees and Chairman of the Corporation's and the Bank's
Executive Committee.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 2101(3)
Walter Hill, 68, part owner of Hill Brothers Fruit Farm and Cider Mill; joined
the Corporation's and the Bank's Board of Directors in 1986; Director of the
Bank from 1983 to the present; Director of Jack Brown Produce and Michigan
Agricultural Commodities Marketing Association; serves as a member of the
Corporation's and the Bank's Personnel/Compensation Committee.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 5270(3) 1.3%
Andrew Zamiara, 53, Registered Pharmacist and President/Manager of Momber
Pharmacy and Gift Shop; appointed to the Corporation's and the Bank's Board of
Directors in August, 1990 to fill the Class I vacancy created by the death of
H. Paul McFall; serves as a member of the Corporation's and the Bank's
Investment and Asset/Liability, and Personnel/Compensation Committees.
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 762(4)
William F. Cutler, Jr., 47, formerly Vice President of the H. H.
Cutler Company; joined H. H. Cutler on January 5, 1970 and worked
there until January 28, 1994. The H. H. Cutler Company was sold to VF
(Vanity Fair) Corporation on January 4, 1994. Mr. Cutler became a
Director of the Corporation and the Bank on October 13, 1993. Mr.
Cutler is President of the Board of Directors of the Sparta Health
Center of which he has been a Director since 1981. Mr. Cutler is also
a Trustee of the Rockford Education Foundation.
6
<PAGE> 8
Shares of the Corporation's Common
Stock owned beneficially . . . . . . . 825
All Directors and Executive Officers as a group (16 persons)
owned 24,853 shares of Common Stock of the Corporation as of March 1, 1995,
representing approximately 6.1% of the outstanding shares. (1)(2)(3)(4)
(1) Except as otherwise indicated, each Director has sole
voting and investment power over the shares he or she beneficially owns.
(2) Where no percentages are shown for the shares owned
by the nominee, the percentage of ownership is less than 1%.
(3) Includes shares held by family members of certain
Directors and Officers in which such Directors and Officers disclaim any
beneficial interest.
(4) Includes shares owned jointly with spouse.
Except as discussed above, each of the nominees or Directors
of the Corporation has had the principal occupation set forth above or has been
an executive officer or partner with the respective organization for the past
five (5) years.
There are no family relationships between any director,
executive officer, or person nominated or chosen by the Corporation to become a
director or executive officer.
Executive Officers
<TABLE>
<CAPTION>
Years As An
Executive Officer
Of The
Name Age Position with Corporation Corporation
- ---- --- ------------------------- -----------
<S> <C> <C> <C>
L. Edmond Eary, Jr.
M.D. 66 Chairman of the Board 4
(since May 15, 1991)
Jae M. Maxfield 49 President/Chief Executive 0
Officer (since January 11,
1995)
Denis L. Crosby 52 Vice President (since May 15, 4
1991)
</TABLE>
7
<PAGE> 9
<TABLE>
<S> <C> <C> <C>
Linda R. Pitsch 47 Secretary (since February 20,
1995); Senior Vice President
(since January 1, 1993)
and Cashier (since August 1,
1984) of Sparta State Bank 0
Thomas L. Lampen 39 Treasurer (since March 12, 9
1986)
Gerald P. David 56 Senior Vice President of Sparta 0
State Bank (since January 1, 1985)
</TABLE>
There are no arrangements or understandings between any of the
directors, executive officers or any other persons pursuant to which any of the
directors or executive officers of the Corporation have been selected for their
respective positions. None of the directors, nominees or executive officers
are involved in any material pending legal proceedings other than ordinary,
routine litigation incidental to the business to which the Corporation or any
of its subsidiaries is a party or of which any of their property is subject.
Voting Securities
As of March 1, 1995, the Corporation had Four Hundred Five
Thousand Seven Hundred Sixty (405,760) issued and outstanding shares of voting
common stock, $10.00 par value per share, all of the same class ("Common
Stock"). All holders of record of Common Stock as of 5:00 p.m. Eastern
Standard time on March 24, 1995 will be entitled to vote at the Annual Meeting
and any adjournment thereof. Each share of Common Stock is entitled to cast
one (1) vote on each matter presented for a vote at the Annual Meeting.
Security Ownership of Certain Beneficial Owners
The Corporation's management is not aware of any beneficial
owners of more than 5% of the Corporation's Common Stock as of December 31,
1994.
Transactions with Management
Directors, executive officers and their associates were
customers of, and had transactions with, the Bank in the ordinary course of
business in 1994. Comparable transactions may be expected to continue in the
future.
Certain directors and executive officers of the Corporation
and the Bank, members of their immediate families, and business affiliates of
certain directors and executive officers were indebted to the Bank from time to
time during 1994. As of December 31, 1994, the outstanding aggregate balance
of the loans
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<PAGE> 10
to such persons was approximately $2,048,710. These loans were made in the
ordinary course of business, were made on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with others, and did not involve more than the normal
risk of collectibility or present other unfavorable features.
On May 22, 1990, the Bank opened a new branch facility on the
corner of Division Street and Ida Red Avenue in Sparta, Michigan. Bradford
Insurance Centre Ltd. has entered into a Lease and Option to Purchase with the
Bank providing for the lease/purchase of a portion of the land and building
which is also occupied by the Bank. Mr. Bradford and two of his brothers are
the stockholders of Bradford Insurance Centre Ltd. The Lease and Option to
Purchase was negotiated by the Bank and Bradford Insurance Center, Ltd. on an
arm's length basis and contains terms and conditions comparable to other
lease/purchase transactions in the area.
Committees of the Board of Directors
The Board of Directors of the Corporation and the Bank have
identical committees that are served by the same individuals. The Corporation's
Board of Directors had sixteen (16) meetings, including both regularly
scheduled and special meetings, which were held during the last full fiscal
year. All Directors attended at least 75% of the meetings of the Board of
Directors and the various committees of which they are members. The various
committees of the Corporation and the Bank as they existed on December 31, 1994
are discussed below.
Investment Committee
In 1994, the Corporation's Board of Directors had a standing
Investment Committee comprised of five (5) Directors, two (2) executive
officers of the Corporation and two (2) members from the Bank's management: Dr.
L. Edmond Eary (Chairman), Walter Hill, Thomas Lampen, Kelly Potes, Gerald
David, Denis Crosby, Andrew Zamiara, Stuart Goodfellow and Frank Berris. The
duties of this committee include monitoring the written Investment Policy of
the Bank and reviewing portfolio composition and reports to the Board of
Directors. Three (3) meetings were held in 1994.
Asset/Liability Committee
In 1994, the Corporation's Board of Directors had a standing
Asset/Liability Committee comprised of the same members who served on the
Investment Committee. The functions of this committee include responsibility
and authority to carry out directives among all areas of the Bank which are
consistent with the policies set forth by the Board of Directors and monitoring
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<PAGE> 11
interest rate risk. The Investment and Asset/Liability Committees meet
concurrently. Three (3) meetings were held in 1994.
Audit Committee
In 1994, the Corporation's Board of Directors had a standing
Audit Committee comprised of the following four (4) directors who are not
employees of the Corporation or the Bank: Jon Pike (Chairman), Stuart
Goodfellow, William F. Cutler, Jr. and Frank Berris. The functions generally
performed by this committee include reviewing the scope of the Corporation's
and the Bank's procedures for internal auditing and the results thereof,
reviewing the scope of the audit by external auditors, reviewing the management
letter of the external auditors, making a recommendation to the Board of
Directors to retain the external auditors of the Corporation for the ensuing
fiscal year and reviewing the consolidated financial statements of the
Corporation prior to their release. The Audit Committee meets quarterly.
Personnel/Compensation Committee
In 1994, the Corporation's Board of Directors had a standing
Personnel/Compensation Committee comprised of the following six (6) directors,
all of whom are not employees of the Corporation or the Bank: Lawrence
Bradford (Chairman), Lewis Emmons, Walter Hill, Andrew Zamiara, Stuart
Goodfellow, and Mary Jean Herwaldt. The committee receives recommendations
from senior management and makes recommendations to the Board of Directors on
the total compensation and benefits of the officers of the Bank. The committee
also monitors the provisions of the Personnel Manual and sets the parameters
for the incentive bonus program of the Bank. The Personnel/Compensation
Committee held three (3) meetings in 1994.
Pension Plan Administrative Committee
In 1994, the Corporation's Board of Directors had a Pension
Plan Administrative Committee comprised of the following three (3) directors of
the Corporation: Jon Pike, Lewis Emmons, and Mary Jean Herwaldt. This
committee functions as needed to administer the established Pension Plan of the
Bank. Two (2) meetings of this committee were held in 1994.
Loan Review Committee
In 1994, the Corporation's Board of Directors had a Loan
Review Committee comprised of three (3) non-officer directors of the
Corporation serving on a rotating basis as appointed monthly by the Chairman of
the Board. This committee reviews all aspects of loan activity for the Bank
for the preceding month, including new loans of $25,000.00 or greater, problem
loans and loans classified by examiners, loans 60 days or more past due and
non-accruals. This
10
<PAGE> 12
Committee approves loan charge-offs and extensions of credit up to 15% of the
capital and surplus of the Bank. The Loan Review Committee held twelve (12)
meetings in 1994.
Executive Committee
In 1994, the Corporation's Board of Directors had a standing
Executive Committee comprised of the following directors: Andrew Zamiara
(Chairman), Dr. L. Edmond Eary, Lawrence Bradford, and Denis Crosby. Mr.
Crosby is also an executive officer of the Bank. This committee may function
as the Directors' Loan Review Committee and has the same lending authority as
that committee. It may also act in other capacities as authorized by the Board
of Directors. The Executive Committee held seven (7) meetings in 1994.
Compliance/CRA Committee
In 1994, the Corporation's Board of Directors had a standing
Compliance/CRA Committee comprised of three (3) Directors, one (1) Executive
officer of the Corporation and two (2) members of Bank's management: Linda
Pitsch (Chairman), Gerald David, Denis Crosby, Dr. L. Edmond Eary, Mary Jean
Herwaldt and Anna Parker. The duties of this committee include monitoring the
compliance/CRA program of the Bank, reviewing the external compliance reviews,
reviewing implementation of guidelines for new regulations, and reviewing
Community Reinvestment Act Compliance Program. Five (5) meetings were held in
1994.
Ad Hoc Committee
In 1994, the Corporation's Board of Directors had a standing
Ad Hoc Committee comprised of four (4) Directors: Jon Pike, Dr. L. Edmond
Eary, Lawrence Bradford, and William F. Cutler, Jr. The duties of the
committee included evaluating and hiring a search firm for candidates of office
of President of the Corporation and Bank and evaluating and presenting to the
full Board of Directors possible candidates for office of President of the
Corporation and the Bank. Five (5) meetings were held in 1994.
Strategic Planning Committee
In 1994, the Corporation's Board of Directors established a
Strategic Planning Committee for the Corporation and the Bank which included
the following directors: Dr. L. Edmond Eary, William F. Cutler, Jr., Andrew
Zamiara, Lewis G. Emmons and Marvin J. Besteman. Also included on this
Committee were the following employees of the Bank: Thomas L. Lampen, Linda R.
Pitsch, Dean Anderson and Kelly Potes. The purpose of this Committee is to
conduct strategic planning for the Corporation and the Bank. The Strategic
Planning Committee did not meet in 1994.
11
<PAGE> 13
Committee to Consider Acquisitions
In 1994, the Corporation's Board of Directors established a
Committee to Consider Acquisitions for the Corporation and the Bank which
included the following directors: Jon E. Pike, Dr. L. Edmond Eary, Marvin J.
Besteman and Lawrence D. Bradford. The purpose of this Committee is to
consider potential acquisitions by the Bank and/or the Corporation. The
Committee to Consider Acquisitions did not meet in 1994.
Compensation of Directors and Officers
The Corporation has paid no remuneration, direct or indirect,
to its directors or executive officers since December 31, 1993 for attending
any of the meetings described above, other than fees to directors in the amount
of $50.00 per person for regular monthly meetings of the Board of Directors.
The outside directors of the Corporation were also paid $60.00 per hour by the
Bank for meetings of the committees of the Board of Directors. The secretary
of the Corporation and the Bank is paid predetermined amounts equal to $25.00
per month and $225.00 per month, respectively, for her services. During fiscal
year 1994, a total of $61,720 was paid in director's fees to the directors of
the Corporation and the Bank as a group for monthly meetings of the Board of
Directors and for committee meetings. No amounts have accrued under any
retirement or other employee benefit plan of the Corporation since December 31,
1993.
The Board of Directors of the Corporation announced to its
shareholders on September 30, 1994, that Marvin J. Besteman resigned his
position as President and Chief Executive Officer, effective October 1, 1994.
Mr. Besteman no longer serves as a director of the Corporation, but will
continue to be affiliated as an advisor and consultant to the Board of
Directors until June 30, 1996, when he will take full retirement. Dr. L.
Edmond Eary, Jr., Chairman of the Board of Directors, served as interim
President and Chief Executive Officer until January 11, 1995 when Jae M.
Maxfield was named as the new President and Chief Executive Officer of the
Corporation and the Bank. Dr. Eary has been the Chairman of the Board of
Directors of the Corporation and the Bank since May 1991. He has been a member
of the Corporation's Board of Directors since its formation in November 1986,
and a member of the Board of Directors of the Bank since January 1969.
The following table sets forth the total compensation paid or
accrued by the Bank during the fiscal year ended December 31, 1994 for the
Bank's Chief Executive Officer and each of the four (4) most highly compensated
executive officers whose total compensation for all services rendered to the
Bank exceeded $100,000.
12
<PAGE> 14
<TABLE>
<CAPTION>
Summary Compensation Table
--------------------------
Annual Compensation Awards Payouts
--------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
All
Name Other Other
and Annual Restricted Compen-
Principal Compen- Stock Optional LTIP sation($)
Position Year Salary($) Bonus($)(1) sation($)(2) Award(s)($) SARs($) Payouts($) (3),(4),(5),
- --------- ------ --------- ----------- ------------ ----------- -------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Marvin J. 1994 $91,538 $10,023 $38,324 $ 0 $ 0 $ 0 $2,403
Besteman/ 1993 $99,000 $22,097 $22,133 0 0 0 $4,106
CEO 1992 $95,000 $23,085 $20,235 0 0 0 $3,718
L. Edmond 1994 $10,550 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Eary/Interim
CEO
</TABLE>
- --------------------
(1) The Bonus column includes the incentive bonus accrued for Mr. Besteman
for the fiscal year indicated, which was paid in the following fiscal
year.
(2) Other Annual Compensation includes $12,459 for 1994, $13,124 for 1993,
and $11,575 for 1992 for the benefit of the automobile provided to Mr.
Besteman and the taxes due in connection with this benefit. Other
Annual Compensation for 1994 also includes a one-time, lump sum
payment of $10,000 to Mr. Besteman in connection with a Separation
Agreement and Release, dated September 14, 1994 ("Agreement"), between
Mr. Besteman, the Corporation and the Bank and $9,000 representing the
value of the automobile previously provided by the Corporation for Mr.
Besteman's use, the ownership of which was transferred to Mr. Besteman
pursuant to the Agreement.
(3) The All Other Compensation column does not include supplemental
retirement benefits payable to Mr. Besteman under an Agreement dated
February 19, 1985, as amended by a letter agreement dated October 14,
1987, and the Modified and Amended Employment Agreement dated June 15,
1988 (the "Agreement"). The Agreement provides for payments of
$2,083.33 per month for a period of 120 months, subject to the
following exceptions. All benefits are forfeited by Mr. Besteman if
he becomes an employee, officer, director or consultant of any
financial institution with a business location within 50 miles of
Sparta, Michigan, within three years after terminating his employment
with the Bank. If Mr. Besteman dies after the payments have begun,
but before 120 payments have been made, the monthly payments to Mr.
Besteman's spouse will be reduced to $1,041.67 per month. If Mr.
Besteman and his spouse both die before 120 payments are made, no
further benefits shall be paid. If Mr. Besteman dies while (i)
employed by the Bank, (ii) receiving disability benefits, or (iii)
receiving severance benefits, discussed below, monthly payments of
$1,041.67 will be paid to Mr. Besteman's spouse beginning on the first
day of the calendar month after Mr. Besteman would have attained age
62 (or the first day of the calendar month after Mr. Besteman's
death, if death occurs after attaining age 62). Monthly payments will
continue until a total of 120 monthly payments are made or Mr.
Besteman's spouse dies, whichever occurs first.
13
<PAGE> 15
(4) The All Other Compensation column includes $328 for 1994, $1,289 for
1993, and $1,745 for 1992 paid by the Bank under a Split Dollar
Insurance Agreement entered into by the Bank and Mr. Besteman on June
15, 1988 ("Split Dollar Insurance Agreement"). The Split Dollar
Insurance Agreement provides that Mr. Besteman pays the term cost of a
$100,000 life insurance policy and the Bank pays the balance of the
annual premium due under the policy. The cash surrender value of the
policy equal to the total premiums paid by the Bank is the property of
the Bank and any additional cash surrender value is payable to Mr.
Besteman. Mr. Besteman's beneficiary or beneficiaries are entitled to
a death benefit of $100,000. The balance of the death benefit under
the policy at the time of Mr. Besteman's death is payable to the Bank.
The All Other Compensation column also includes $702 for 1994, $1,332
for 1993, and $1,260 for 1992 paid by the Bank under a group term life
insurance policy. Finally, the All Other Compensation column includes
the Bank's matching contributions of $.25 for every $1.00 contributed
by Mr. Besteman up to six percent (6%) of his annual salary. These
amounts were $1,373 for 1994, $1,485 for 1993 and $713 for 1992.
(5) Mr. Besteman will continue to be affiliated with Sparta State Bank
performing such duties and consulting services at such reasonable
times and places as the Board of Directors may reasonably request at
an annual salary of Fifty Thousand Dollars ($50,000) beginning as of
October 1, 1994 through June 30, 1996. Mr. Besteman shall be eligible
to receive benefits under the terms and conditions provided for in the
Sparta State Bank Employee Handbook through June 30, 1996, or until
his employment with the bank is terminated.
(6) Dr. Eary served as the Interim Chief Executive Officer from October 1,
1994 to January 10, 1995.
---------------
Disclosure of Late Filings and Non-Filings
Under Section 16(a) of the Securities Exchange Act of 1934, as
amended, the Corporation's directors, its executive officers, and any persons
holding more than ten percent (10%) of the Corporation's common stock are
required to report their ownership of the Corporation's common stock and any
changes in that ownership to the Securities and Exchange Commission ("SEC").
Officers, directors and greater than 10% shareholders are required by SEC
regulations to furnish the Corporation with copies of all Section 16(a) forms
they file. Specific due dates for these reports have been established and the
Corporation is required to report in this Proxy Statement any failure to file
by these dates during 1993 and 1994.
Based solely upon review of such reports furnished to the
Corporation or written representations that no other reports were required, the
Corporation believes that during the 1994 fiscal year
14
<PAGE> 16
all of these filing requirements were satisfied by its directors, officers and
10% beneficial owners, except that one (1) report covering one (1) transaction
was filed late by Frank G. Berris, and one (1) report covering one (1)
transaction was filed late by Jae M. Maxfield. Information regarding these
filings was provided to the responsible officers of the Corporation in a timely
fashion, but the filings were not made until after their respective due dates.
Pension Plan
The Sparta State Bank Pension Plan (the "Pension Plan") is a
defined benefit plan which was originally adopted effective as of April 1,
1968. The Pension Plan is qualified under Section 401(a) of the Internal
Revenue Code. The cost of the Pension Plan is borne entirely by the Bank. The
purpose of the Pension Plan is to provide retirement benefits to Bank
employees. In order to comply with federal law, each participant is fully
vested after six Years of Vested Service.
Subject to certain minimums, the monthly Normal Retirement
Benefit is equal to 1.1% of the participant's Average Monthly Compensation
multiplied by his or her Years of Vested Service (without limit on amount),
plus 0.6% of the participant's Average Monthly Compensation in excess of
Covered Compensation multiplied by his or her Years of Vested Service (up to a
maximum of 35 years). "Average Monthly Compensation" means the monthly average
of the participant's compensation during the five highest paid consecutive Plan
Years during the ten Plan Years immediately preceding his or her termination of
employment. "Covered Compensation" means the greater of (i) $1,000.00 or (ii)
one-twenty-fourth (1/24) of the covered compensation (determined under IRS
regulations) of an individual who attains social security retirement age in the
plan year in which the benefit is calculated. Election of available joint and
survivor benefits, early retirement benefits and other payment options would
reduce monthly retirement benefits.
Since retirement benefits under the Pension Plan are based in
substantial part upon compensation during the ten (10) years before termination
of employment, it is not possible to predict accurately the annual retirement
benefits to be paid to any participant. The Pension Table set forth below
shows estimated annual benefits payable under the Pension Plan upon retirement
to persons in the compensation and years-of-service classifications specified
below:
15
<PAGE> 17
Pension Plan Table(1)(2)(3)
<TABLE>
<CAPTION>
Final
Average
Annual Years of Benefit Service
Remuneration(4) 10 15 20 25 30 35 40
- --------------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 20,000 $ 2,671 $ 4,006 $ 5,341 $ 6,677 $ 8,012 $ 9,347 $10,447
40,000 $ 6,071 $ 9,106 $12,141 $15,177 $18,212 $21,247 $23,447
60,000 $ 9,471 $14,206 $18,941 $23,677 $28,412 $33,147 $36,447
80,000 $12,871 $19,306 $25,741 $32,177 $38,612 $45,047 $49,447
100,000 $16,271 $24,406 $32,541 $40,677 $48,812 $56,947 $62,447
</TABLE>
- ---------------
(1) The amount of contribution with respect to a specified person is not
and cannot readily be separately calculated under the actuarial cost
method (Entry Age Normal) employed by the plan actuaries. Benefits
are annual amounts, based on a straight-life annuity at age 65, and
are not subject to offset by Social Security.
(2) The aggregate contribution to the Plan for the 1994 plan year
represents 2.00% of the total remuneration covered by the Plan.
(3) The remuneration covered by the Plan includes salary, hourly wages,
overtime, incentive pay, bonuses and commissions.
(4) The average of the highest remuneration for five (5) consecutive years
during the last ten (10) years of employment.
401(k) Plan
The Sparta State Bank 401(k) Retirement Savings Plan (the
"Savings Plan") is a 401(k) plan which was established as of July 1, 1992. The
Savings Plan is qualified under Section 401(a) of the Internal Revenue Code.
The purpose of the Savings Plan is to permit Bank employees to
save for retirement on a pre-tax basis. In addition to the pre-tax
contributions by Bank employees, the Bank may make discretionary matching
and/or profit-sharing contributions to the Savings Plan. If matching and/or
profit-sharing contributions are made to the Savings Plan, a participant is
fully vested in those contributions after six Years of Vested Service.
Each participant in the Plan has an account to record his or
her interest in the Plan. The amount of the contributions made
16
<PAGE> 18
by or on behalf of the participants are credited to their accounts. The
participant directs the investment of his or her account in various investment
funds made available by the trustee of the Savings Plan. A participant's
benefit from the Savings Plan is equal to the vested amount in the account when
he or she terminates employment with the Bank. Accordingly, it is not possible
to accurately predict the benefits to be paid to any participant from the
Savings Plan.
Incentive Bonus Plan
The Bank's Incentive Bonus Plan (the "Plan") was established
for all of the Bank's officers effective for the 1985 fiscal year. The Plan
has applied to all employees (both officer and non-officer personnel)
commencing with the 1986 fiscal year. The purposes of the Plan are to (i)
motivate all personnel of the Bank, (ii) encourage growth of profits and
maximization of return on assets of the Bank, and (iii) provide an opportunity
for participants to be rewarded for efforts and results that are deemed above
average.
The Plan was revised for the 1990 fiscal year and consists of
a two part plan. The Personal Performance part of the plan is to be paid if
the Bank has reached a net profit for the year. Maximum eligible bonuses under
this segment of the plan are 12%, 9%, 5% and 3% of base salary for the year for
the President, all other officers, full-time employees (those who work 1,000 or
more hours during the plan year), and part-time employees (those who work less
than 1,000 hours during the plan year), respectively. Bonus awards are
determined by an evaluation of each individual's performance.
The Bank Profit part of the plan is a guaranteed portion of
the profits of the Bank based on the ratio of achieved ROA (return on assets)
to maximum ROA. The Board of Directors will annually determine minimum and
maximum ROA percentages to govern this plan. Maximum Bank Profit bonus
percentages under this segment of the plan are 16.5%, 12.5%, 6.25% and 3.125%
of base salary for the year for the President, all other officers, full-time
employees and part-time employees, respectively.
Determinations of eligibility, funding, allocations and
amounts of awards are subject to the review and final approval of the Board of
Directors of the Bank. The Bank's executive officers, as a group, who are also
executive officers of the Corporation received incentive bonuses totaling
$43,436 for the 1994 fiscal year.
Independent Public Accountants
The Board of Directors of the Corporation recommends that the
shareholders approve management's selection of Crowe, Chizek and Co., C.P.A. to
act as the Corporation's accountants for the
17
<PAGE> 19
Corporation's current fiscal year. Representatives of Crowe, Chizek and Co.,
C.P.A. will have an opportunity to make a statement at the Annual Meeting if
they desire to do so. A representative of Crowe, Chizek and Co., C.P.A. is not
expected to be present at the Annual Meeting, or to respond to questions.
Crowe, Chizek & Co. has been the external auditor for both the
Bank and the Corporation from 1986 to the present. Subject to approval by the
Corporation's shareholders, the Corporation's Audit Committee will engage
Crowe, Chizek & Co., C.P.A., to perform its annual audit for the fiscal year
1995.
Crowe, Chizek and Co., C.P.A., has examined and rendered an
unqualified opinion on the consolidated financial statements of 1st Community
Bancorp, Inc. for the periods indicated in those statements, which are enclosed
with this Proxy Statement.
18
<PAGE> 20
1ST COMMUNITY BANCORP, INC.
109 E. Division St., Sparta, Michigan 49345
PROXY/BALLOT SOLICITED BY BOARD OF DIRECTORS FOR ANNUAL MEETING OF SHAREHOLDERS
DIRECTORS RECOMMEND: FOR ALL THE NOMINEES LISTED BELOW AND FOR THE OTHER
PROPOSALS DESCRIBED BELOW
The undersigned shareholder of 1st Community Bancorp, Inc., common
stock as of stock on record date March 24, 1995, hereby constitutes and
appoints L. Edmond Eary, Jr., MD, Jae M. Maxfield and Linda R. Pitsch, and each
of them, attorneys for the undersigned, to vote as proxy with respect to all
shares owned by or registered in the name of the undersigned with full power of
substitution, at the Annual Meeting of the Shareholders of 1st Community
Bancorp, Inc., to be held at Cleo's Banquet Room, 5255 Alpine, N.W., Grand
Rapids, Michigan, on Thursday, April 27, 1995, at 7:30 p.m., Eastern Standard
Time, and any adjournments thereof, with all power which the undersigned would
possess if personally present with respect to the following propositions:
1. ELECTION OF CLASS II DIRECTORS - PLEASE MARK ONE BOX ONLY.
FRANK BERRIS LEWIS EMMONS
LAWRENCE BRADFORD STUART GOODFELLOW
/ / FOR all nominees listed (except as marked to the contrary below)
To withhold authority to vote for any individual nominee(s),
write name(s) on below line:
_____________________________________________________________________
/ / WITHHOLD authority to vote for all nominees listed.
2. APPROVAL OF THE DIRECTORS' SELECTION OF ACCOUNTANTS, CROWE. CHIZEK AND
CO., CPA FOR THE CORPORATION'S CURRENT FISCAL YEAR.
MARK ONE BOX ONLY
/ / FOR / / AGAINST / / ABSTAIN
3. TO VOTE AT THEIR DISCRETION ON SUCH OTHER MATTERS AS MAY COME BEFORE
THE MEETING OR ANY ADJOURNMENTS THEREOF.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS INSTRUCTED HEREIN BY THE
UNDERSIGNED SHAREHOLDER. IF NO INSTRUCTION IS GIVEN, THIS PROXY WILL BE VOTED
FOR ALL THE NOMINEES LISTED ABOVE AND FOR THE OTHER PROPOSALS DESCRIBED ABOVE.
Any shareholder who gives a proxy has the right to revoke it at any time before
it is exercised. It may be revoked by delivering to the Secretary of the
Corporation at the address shown above a written notice of revocation, or by
revoking it orally at the meeting.
PLEASE MARK, SIGN, DATE, AND RETURN THIS PROXY IN THE ENCLOSED ENVELOPE WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
DATED:____________________, 1995
_____________________________
Signature
_____________________________
Signature
_____________________________
Signature
If stock is registered in the name of two or more persons, all must sign. When
signing as attorney, executor, administrator, trustee, or guardian, give full
title as such.
