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As filed with the Securities and Exchange Commission on June , 1999
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under the
Securities Act of 1933
COMMERCIAL NATIONAL FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Michigan 38-1688835
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
101 North Pine River
Ithaca, Michigan 48847
(517) 875-4144
(Address, including zip code, and telephone number,
including area code, or registrant's principal executive offices)
Jeffrey S. Barker
President and Chief Executive Officer
Commercial National Financial Corporation
101 North Pine River
Ithaca, Michigan 48847
(517) 875-4144
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this registration statement.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box: [X]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [ ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering: [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: [ ]
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<CAPTION>
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CALCULATION OF REGISTRATION FEE
==========================================================================================
Proposed Proposed
Title of each class Amount Maximum Maximum Amount of
of Securities to be Offering Price Aggregate Registration
to be Registration Registered Per Unit Offering Price Fee
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<S> <C> <C> <C> <C>
Common Shares 50,000 (1) $38.50(2) $1,925,000(2) $535.15(2)
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</TABLE>
(1) Plus such indeterminate number of additional shares as may be required to be
issued in the event of an adjustment as a result of an increase in the number of
issued shares of common stock resulting from a subdivision of such shares, the
payment of stock dividends or certain other capital adjustments.
(2) Estimated based on the average price of the common stock on June 24, 1999,
pursuant to Section 6(b) and in accordance with Rule 457(c) of the General Rules
and Regulations under the Securities Act of 1933, as amended, solely for
purposes of calculating the registration fee.
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COMMERCIAL NATIONAL
FINANCIAL CORPORATION
PROSPECTUS
DIVIDEND REINVESTMENT PLAN
OFFERING UP TO 120,000 SHARES OF
COMMON STOCK, WITHOUT PAR VALUE
The Dividend Reinvestment Plan (the "Plan") of Commercial National
Financial Corporation (the "Corporation") provides holders of the Corporation's
Common Stock, without par value ("Common Stock"), with a convenient method of
purchasing additional shares of Common Stock by automatically reinvesting the
cash dividends received on their shares of Common Stock without payment of any
brokerage commission or service charge.
The shares purchased under the Plan may be newly issued shares or
shares purchased for participants in the open market, at the Corporation's
option. The Plan currently provides that shares purchased for participants with
reinvested dividends will be purchased at ninety-five percent (95%) of the fair
market value determined as provided in the Plan. The Corporation, however,
reserves the right to modify the pricing or any other provision of the Plan at
any time. The Plan does not represent a change in the Corporation's dividend
policy or a guarantee of future dividends, which will continue to depend on
earnings, financial requirements, and other factors.
Shareholders enrolled in the Plan will continue to be enrolled unless
they notify Commercial Bank, Agent for the Plan, that they wish to withdraw from
participation (see "Description of the Plan"). Shareholders who do not wish to
participate in the Plan will continue to receive cash dividends, as declared, by
check or direct deposit in the usual manner.
This Prospectus relates to shares of Common Stock of the Corporation
registered for purchase under the Plan. It is suggested that this Prospectus be
retained for future reference.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COM-
MISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
---------------
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR
A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECU-
RITIES OFFERED BY THIS PROSPECTUS IN ANY JURIS-
DICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER IN SUCH JURISDICTION.
The date of this Prospectus is June 30, 1999.
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No person has been authorized to give any information or to make any
representation other than as contained or incorporated by reference in this
Prospectus. This Prospectus does not constitute an offer of any securities other
than those described on the cover page or an offer to sell or a solicitation of
an offer to buy within any jurisdiction to any person to whom it is unlawful to
make such offer or solicitation within such jurisdiction. Neither the delivery
of this Prospectus nor any sales made under this Prospectus shall under any
circumstances create any implication that there has been no change in the
affairs of the Corporation since the date of this Prospectus.
AVAILABLE INFORMATION
The Corporation is subject to the information requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and in
accordance therewith files reports, proxy statements, and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements, and other information may be read and copied, at the Commission's
Public Reference Room located at 450 5th Street, N.W., Washington, D.C. 20549.
The public may obtain information on the operation of the Public Reference Room
by calling the Commission at 1-800-SEC-0330. The Commission maintains an
Internet site that contains reports, proxy and information statements, and other
information regarding issuers that file electronically with the Commission. The
address of the Commission's Internet site is http://www.sec.gov.
The Corporation will furnish without charge to each person, including
any beneficial owner, to whom this Prospectus is delivered, upon the person's
written or oral request, a copy of any or all of the documents described under
the caption "Incorporation of Certain Documents by Reference," other than
exhibits to such documents (unless such exhibits are specifically incorporated
by reference into such documents). Requests should be directed to COMMERCIAL
NATIONAL FINANCIAL CORPORATION, 101 North Pine River, Ithaca, Michigan 48847,
(517) 875-4144.
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COMMERCIAL NATIONAL FINANCIAL CORPORATION
Commercial National Financial Corporation is a bank holding company,
owning all of the outstanding stock of Commercial Bank of Ithaca, Michigan.
The Corporation was incorporated under the laws of the State of
Michigan in 1987 for the purpose of becoming a bank holding company by acquiring
Commercial Bank (f/k/a Commercial National Bank). The Corporation's offices are
located at 101 North Pine River, Ithaca, Michigan 48847, and its telephone
number is (517) 875-4144.
Aside from the stock of its subsidiary bank, the Corporation has no
substantial assets. The Company's income depends upon management fees, interest
charges, and dividends received from its subsidiary bank, which are limited by
applicable state and federal regulations.
As a bank holding company, the Corporation has broader corporate powers
than its subsidiary bank. These broader corporate powers principally include the
power to engage in certain nonbanking businesses closely related to banking, to
own the capital stock of banks located in Michigan, and to own the capital stock
of business corporations which are not banks, located either within Michigan or
outside of Michigan, all subject, however, to the provisions of the Bank Holding
Company Act of 1956, as amended, and regulations of the Board of Governors of
the Federal Reserve System.
USE OF PROCEEDS
The Corporation has no basis for estimating precisely either the number
of shares of Common Stock that ultimately may be sold pursuant to the Plan or
the prices at which such shares will be sold. However, the Corporation proposes
to use the net proceeds from the sale of authorized but unissued shares of
Common Stock pursuant to the Plan, when and as received, to increase the
Corporation's capital and for other general corporate purposes. The net proceeds
from the sale of shares of Common Stock purchased in the open market pursuant to
the Plan will be applied to the purchase price and expenses of acquiring such
shares in the market.
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DESCRIPTION OF THE PLAN
The following is a question and answer statement of the provisions of
the Plan.
1. What is the purpose of the Plan?
The purpose of the Plan is to provide holders of record of
shares of the Common Stock of the Corporation with a convenient and economical
method of investing cash dividends in additional shares of Common Stock, so long
as such additional shares are being made available by the Corporation, or, if
additional shares are not being made so available, in shares of Common Stock
purchased in the open market without payment of any brokerage commission or
service charge. Shares of Common Stock purchased from the Corporation's treasury
or authorized but unissued shares will provide the Corporation with additional
funds for general corporate purposes. The Corporation will receive no proceeds
from purchases by the Plan of any shares in the open market. As used herein, the
term "additional shares" includes authorized but unissued shares.
2. What are the advantages of the Plan?
Participants in the Plan may have cash dividends on their shares
of Common Stock automatically reinvested in shares of Common Stock at a five
percent (5%) discount from the current market value of the Common Stock (as
determined under the Plan) and without paying any brokerage commission or
service charge in connection with purchases under the Plan. Full investment of
funds is possible under the Plan because the Plan permits fractions of shares,
as well as full shares, to be credited to participants' accounts. In addition,
dividends in respect of such fractions, as well as full shares, are credited to
participants' accounts. Participants can avoid the inconvenience and expense of
safekeeping certificates for shares credited to their accounts under the Plan
(see Question 17). Quarterly statements of accounts are furnished to
participants to provide simplified rccordkeeping.
3. Who administers the Plan for participants?
Commercial Bank (the "Agent"), a wholly owned subsidiary of the
Corporation, administers the Plan for participants, keeps records, sends
quarterly statements of account to participants and performs other duties
relating to the Plan (see Question 29). Shares of Common Stock purchased under
the Plan are registered in the name of the Agent (or its nominee), as agent, and
credited to the accounts of the respective participants.
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4. Who is eligible to participate?
All holders of record of shares of Common Stock are eligible to
participate in the Plan, except as described below. Although shares purchased
with reinvested dividends are registered in the name of the Agent (see Question
3), shareholders will continue to hold those shares currently held by them in
their own names and should not transfer such shares to the Agent. The
Corporation reserves the right to exclude participation by shareholders who
reside in jurisdictions, other than Michigan, having laws or regulations that
impose conditions which the Corporation finds unacceptable to its making the
Plan available in such jurisdictions or who fail to provide documentation
acceptable to the Corporation of their state or country (if other than the
United States) of residence. Consequently, the Plan may not be available to
shareholders who live in some states other than Michigan or in countries other
than the United States. A holder of record who wishes to participate in the Plan
must certify the holder's state or country (if other than the United States) of
residence in the Authorization Form and undertake to notify the Agent if such
state or country of residence changes (see Question 9). Upon receipt of the
Authorization Form, the Agent will notify the holder of record within a
reasonable time if the Plan is not available in the state or country where the
holder resides.
5. Can a beneficial owner who is not a holder of record participate
in the Plan?
In order to be eligible to participate fully in the Plan,
beneficial owners of shares of Common Stock whose shares are registered in names
other than their own (for instance, in the name of a broker or nominee) must
become shareholders of record by having shares transferred into their own names.
Beneficial owners interested in participating in the Plan indirectly through
brokers or nominee shareholders should contact their brokers or nominee
shareholders to determine whether such indirect participation is available to
them. The broker or nominee must certify the beneficial owner's state or country
(if other than the United States) of residence in the Authorization Form and
undertake to promptly notify the Agent of any changes in such state or country
of residence (see Question 9). Upon receipt of the Authorization Form, the Agent
will notify the holder of record within a reasonable time if the Plan is not
available in the state or country where the beneficial owner resides.
6. How does a shareholder participate?
A holder of record of shares of Common Stock may join the Plan
at any time by completing and signing an Authorization Form and returning it to
the Agent. An Authorization Form may be obtained by written request to the Agent
(see Question 29).
7. When will investment of dividends start?
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The record dates for the payments of dividends with respect to
the Corporation's Common Stock are chosen from time to time by the Board of
Directors of the Corporation and are customarily in the months of March, June,
September and December of each year. If the Authorization Form is received by
the Agent before the record date for determining the holders of shares entitled
to the next dividend, the reinvestment of dividends will commence with the next
dividend. If the Authorization Form is received on or after such record date,
the reinvestment of dividends will not start until payment of the ensuing
dividend. The Authorization Form must be forwarded so that it will be received
prior to the first day of the record date month in which you desire to commence
participation.
Shareholders are cautioned that the Plan does not represent a
change in the Corporation's dividend policy or a guarantee of future dividends,
which will continue to depend upon the Corporation's earnings, financial
requirements and other factors.
8. Are shareholders enrolled in the Plan required to send in a new
Authorization Form annually?
No. Shareholders enrolled in the Plan will continue to be
enrolled in the Plan without further action on their part, unless the
participant moves to a state or country where the Plan is not available or gives
notice to the Agent in writing that the participant wishes to withdraw from
participation. (See the answers to Questions 21 and 22 for information
concerning withdrawal from the Plan.)
9. What does the Authorization Form provide?
The Authorization Form directs the Agent to apply all of the
participating shareholder's cash dividends on all shares of Common Stock of the
Corporation registered in the participant's own name, as well as on all shares
credited to the participant's account under the Plan, to the purchase of shares
of Common Stock under the Plan.
The Authorization Form also requires the holder of record,
broker or nominee to indicate the state or country (if other than the United
States) of residence of the beneficial owner and to promptly notify the Agent if
such state or country of residence changes.
10. May a participant elect to make optional cash payments under the
Plan?
No. Participation in the Plan is limited to shareholders who
complete the Authorization Form directing the Agent to apply all dividends on
Common Stock held of
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record by them to the purchase of shares of Common Stock under the Plan. A
shareholder may not make optional cash payments under the Plan.
11. Are there any expenses to participants in connection with
purchases under the Plan?
There are no brokerage fees or service charges to participants
in connection with purchases of shares of Common Stock under the Plan. All costs
of administration of the Plan are paid by the Corporation. However, if a
participant requests the Agent to sell the participant's shares in the event of
the participant's withdrawal from the Plan, the participant may be required to
pay a brokerage commission, a service charge and any transfer tax (see Question
21).
12. How will shares be purchased under the Plan?
Cash dividends will be invested on each dividend payment date
for the Common Stock (generally during the months of March, June, September and
December of each year). To the extent the Corporation is making additional
shares of Common Stock available for purchase under the Plan in respect of any
dividend payment date, the Agent will purchase such additional shares of Common
Stock from the Corporation. To the extent the Corporation is not then making
additional shares available for purchase under the Plan, the Agent will purchase
shares of Common Stock in the open market. The Corporation reserves the right,
in its sole discretion, to cease or resume making additional shares of Common
Stock available for such purposes at any time and from time to time.
If the Corporation determines not to make additional shares of
Common Stock available for purchase under the Plan and in the event applicable
law or the closing of the securities markets requires temporary curtailment or
suspension of open market purchases of shares of Common Stock, the Agent is not
accountable for its inability to make purchases at such time. If additional or
other shares of Common Stock are not available for purchase for a period longer
than 90 days, the Agent will promptly mail to each participant a check in the
amount of any unapplied funds in the participant's account.
13. What will be the price of shares purchased under the Plan?
The price of Common Stock purchased with reinvested dividends
for Plan participants will be ninety-five percent (95%) of the Market value of
the Common Stock on the date immediately preceding the dividend payment date.
There is no established market for the Common Stock, and no published
information with respect to its Market value. "Market value" is defined as the
mean between the bid and asked prices obtained from an independent
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broker for the date immediately preceding the dividend payment date, or for the
last preceding date (within 30 days) for which such information is available.
If such information is not available, Market value is defined as
the weighted average price of all sales of Common Stock known to management,
which occurred during the immediately proceeding 3-month period, other than
sales involving officers, directors or other affiliates of the Corporation. If
the Board of Directors determines that such information is for any reason not a
reliable determination of the Market value of the Corporation's Common Stock,
the Board of Directors shall determine the Market value of the Common Stock as
of the date immediately preceding the dividend payment date. In making the
determination, the Board of Directors may consider the financial condition of
the Corporation and its recent operating results, values of publicly traded
securities of other financial institutions giving effect to the relative book
values and earnings of such institutions and the lack of liquidity of the
Corporation's shares, and such other factors as the Board of Directors in its
sole and absolute discretion deems relevant.
If in the future, transactions of the Corporation's Common Stock
become reported on the National Association of Securities Dealers Automatic
Quotation System ("NASDAQ"), the price of shares of Common Stock purchased from
the Corporation for participants in the Plan with reinvested cash dividends will
be ninety-five percent (95%) of the last reported sale price for the
Corporation's Common Stock at the close of trading on the over-the-counter
market as quoted by NASDAQ on the trading day immediately preceding the dividend
payment date. If in the future the Corporation's Common Stock becomes quoted by
NASDAQ in the bid and asked quotations but the volume of transactions is
insufficient to be quoted by NASDAQ as a transaction reported, then the price of
shares of Common Stock purchased from the Corporation for participants in the
Plan with reinvested cash dividends will be ninety-five percent (95%) of the
average of the high bid and low asked quotation for the Common Stock as reported
by NASDAQ for the three trading days immediately preceding the dividend payment
date.
14. How many shares will be purchased for participants?
The number of shares that will be purchased for each participant
on any dividend payment date will depend on the amount of the participant's
dividend and the purchase price of the shares of Common Stock. Each
participant's account will be credited with that number of shares (including
fractions computed to four decimal places) equal to the total amount to be
invested, divided by the applicable purchase price (also computed to four
decimal places).
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15. What kind of reports will be sent to participants in the Plan?
Each participant in the Plan will receive quarterly statements
of account. These statements are a participant's record of the costs of the
participant's purchases and should be retained for income tax purposes. In
addition, each participant will receive the most current Prospectus for the Plan
and copies of the same communications sent to all other holders of shares of
Common Stock, including the Corporation's quarterly reports and annual report to
shareholders, a notice of the annual meeting and proxy statement and Internal
Revenue Service information for reporting dividend income received.
16. Will participants receive dividends on shares held in their Plan
accounts?
Yes. Dividends on full shares, and any fraction of a share,
credited to a participant's account will be reinvested in shares of Common Stock
and credited to the participant's account.
17. Will certificates be issued for shares of Common Stock purchased
under the Plan?
Shares of Common Stock purchased under the Plan for the accounts
of participants will be registered in the name of the Agent (or its nominee),
and certificates for such shares will not be issued to participants until
requested. The total number of shares credited to an account under the Plan will
be shown on each statement of account. This custodial service protects
participants against the risk of loss, theft, or destruction of stock
certificates.
Certificates for any number of whole shares credited to an
account under the Plan will be issued at any time upon the written request of a
participant to the Agent. Any remaining full shares and fraction of a share will
continue to be credited to the participant's account. Certificates for fractions
of shares will not be issued under any circumstances.
18. In whose name will certificates be registered when issued?
Accounts under the Plan will be maintained in the names in which
certificates of the participants were registered at the time the participants
entered the Plan. Consequently, certificates for whole shares will be similarly
registered when issued at the request of a participant (see Question 17).
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19. What happens when a participant sells or transfers all of the
shares registered in the participant's name?
If a participant disposes of all shares of Common Stock
registered in the participant's name (those for which the participant holds
certificates), the dividends on the shares credited to the participant's account
under the Plan will continue to be reinvested until the participant notifies the
Agent that the participant wishes to withdraw from the Plan.
20. May shares in a Plan account be pledged?
No. A participant who wishes to pledge shares credited to the
participant's Plan account must request that certificates for such shares be
issued to the participant.
21. How does a participant withdraw from the Plan?
A participant may withdraw from the Plan at any time by sending
a written notice to the Agent that the participant wishes to withdraw. When a
participant withdraws from the Plan, or upon termination of the Plan by the
Corporation, certificates for whole shares credited to the participant's account
under the Plan will be issued and a cash payment will be made for any fraction
of a share (see Question 22).
Upon withdrawal from the Plan, the participant may, if the
participant desires, also request that all of the shares, both whole and
fractional, credited to the participant's account be sold by the Agent. If such
sale is requested, the Agent will place a sale order, as promptly as possible
after the processing of the request for withdrawal, for the account of the
participant through an independent broker designated by the Agent. The
participant will receive from the Agent a check for the proceeds of the sale
less a service charge of $1, any brokerage commission and any transfer tax.
22. What happens to a fraction of a share when a participant
withdraws from the Plan?
When a participant withdraws from the Plan, a cash adjustment
representing the value of any fraction of a share then credited to the
participant's account will be mailed directly to the participant. The cash
adjustment will be based on the fair market value of the Common Stock as
determined in accordance with the Plan.
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23. What happens if the Corporation issues a stock dividend or
declares a stock split?
Any stock dividends or split shares distributed by the
Corporation on shares registered in the name of or credited to the account of a
participant under the Plan will be added to the participant's account and not
mailed or delivered directly to the participant. The participant, however, may
request the Corporation to issue certificates for such stock dividends or split
shares once they are added to the participant's account (see Question 17).
24. How will a participant's shares be voted at meetings of
shareholders?
For each meeting of shareholders, the participant will receive a
proxy which will enable the participant to vote shares registered in the
participant's name as well as whole shares credited to the participant's Plan
account. If the proxy card is returned properly signed and marked for voting,
all of such whole shares will be voted as marked. The total number of whole
shares held may also be voted in person at a meeting.
If no instructions are received on a properly signed returned
proxy card with respect to any item thereon, all of a participant's whole
shares--those registered in the participant's name and those credited to the
participant's account under the Plan--will be voted in accordance with the
recommendations of the Corporation's management, just as for nonparticipating
shareholders who return proxies and do not provide instructions. If the proxy
card is not returned or if it is returned unsigned, none of the participant's
shares will be voted unless the participant votes in person.
25. What are the federal income tax consequences of participation in
the Plan?
In general, a participant will have the same federal income tax
consequences with respect to dividends payable to the participant on shares
credited to the participant's Plan account and on shares held by the participant
directly as other holders of the Corporation's shares of Common Stock. In
accordance with Internal Revenue Service rulings applicable to dividend
reinvestment plans similar to the Plan, a participant will be treated for
Federal income tax purposes as having received, on the dividend payment date, a
dividend equal to the full amount of the cash dividend payable on such date with
respect to the participant's shares even though that amount is not actually
received by the participant in cash but, instead, is applied to the purchase of
shares for the participant's account.
If the shares of Common Stock are purchased by the Agent in the
open market, the payment of brokerage commissions and services charges by the
Corporation in connection
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with the purchase of shares in the open market will be treated as additional
dividend income to the participants.
The tax basis of shares acquired under the Plan will be the
purchase price for the stock, plus, as to the shares acquired in the open
market, any commissions, charges or mark-ups paid by the Corporation. For shares
acquired by the Agent directly from the Corporation under the Plan, the holding
period begins the day after the applicable dividend payment date. For shares
acquired by the Agent in the open market under the Plan, the holding period
begins on the purchase date.
A participant will not realize any taxable income when the
participant receives certificates for whole shares credited to the participant's
account under the Plan, either upon the participant's request for such
certificates or upon withdrawal from or termination of the Plan. However, a
participant who receives, upon withdrawal from or termination of the Plan, a
cash payment for any full share then sold for the participant, or for a
fractional share then held in the participant's account, will realize gain or
loss measured by the difference between the amount of the cash which the
participant receives and the price at which such full share or fractional share
was credited to the participant's account. Such gain or loss will be capital in
character if such full share or fractional share is a capital asset in the hands
of the participant. For further information as to tax consequences of
participation in the Plan, participants should consult with their own tax
advisers.
Information for income tax purposes for participants in the Plan
will be printed on the participant's statement of account.
26. What provision is made for foreign shareholders subject to
income tax withholding?
In the case of foreign shareholders who elect to have their
dividends reinvested and whose dividends are subject to United States income tax
withholding, an amount equal to the dividends payable to such shareholders, less
the amount of tax required to be withheld, will be applied to the purchase of
shares of Common Stock under the Plan.
27. What is the responsibility of the Corporation and the Agent
under the Plan?
The Corporation and the Agent, in administering the Plan, will
not be liable for any act done in good faith or for any good faith omission to
act, including without limitation any claim of liability arising out of failure
to terminate a participant's account upon such participant's death prior to
receipt of notice in writing of such death.
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PARTICIPANTS SHOULD RECOGNIZE THAT NEITHER THE CORPORATION NOR
THE AGENT CAN ASSURE THEM OF A PROFIT OR PROTECT THEM AGAINST A LOSS ON THE
SHARES PURCHASED BY THEM UNDER THE PLAN.
28. May the Plan be changed or discontinued?
The Corporation reserves the right to suspend, amend, modify, or
terminate the Plan at any time. All participants will receive notice of any such
suspension, amendment, modification, or termination. Any such modification or
termination will not, of course, affect previously executed transactions.
29. Where should correspondence regarding the Plan be directed?
All correspondence regarding the Plan should be addressed to:
COMMERCIAL BANK
101 North Pine River
Ithaca, Michigan 48847
(517) 875-4144
Please mention the Commercial National Financial Corporation
Dividend Reinvestment Plan on all correspondence.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed in (a) through (d) below and all documents
subsequently filed pursuant to Sections 13(a), 13(c), 14, and 15(d) of the
Exchange Act, prior to the termination of the offering, are incorporated by
reference in this Prospectus.
(a) The Corporation's latest annual report on Form 10-K filed
pursuant to Section 13(a) or 15(d) of the Exchange Act which contains,
either directly or by incorporation by reference, financial statements
for the Corporation's latest fiscal year for which a Form 10-K was
required to have been filed.
(b) All other reports filed pursuant to Section 13(a) or 15(d)
of the Exchange Act since the end of the fiscal year covered by the
annual report referred to in (a) above.
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(c) The description of the Corporation's Common Stock,
registered under Section 12 of the Exchange Act, contained in the
Registration Statement on Form S-4 filed under the Securities Act of
1933, including any amendment or reports filed for the purpose of
updating such description.
(d) All information included in the future in appendixes to
the Commercial National Financial Corporation Dividend Reinvestment
Plan Prospectus.
INDEMNIFICATION
The Corporation's Articles of Incorporation and Bylaws and
certain agreements with directors contain provisions regarding the
indemnification by the Corporation of directors, officers and other persons
under certain conditions.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, or persons
controlling the Corporation pursuant to the foregoing provisions, the
Corporation has been informed that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is therefore unenforceable.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The expenses payable by the Registrant in connection with the
issuance and distribution of the securities being registered are estimated to
be:
<TABLE>
<S> <C>
Registration Fee.....................................$ 535.15
Legal Fees and Expenses...............................2,000.00
Accountant's Fees and Expenses........................1,000.00
Printing Fees and Expenses..............................250.00
Miscellaneous Expenses..................................100.00
------
TOTAL $3,885.15
=========
</TABLE>
Item 15. Indemnification of Directors and Officers
Under Sections 561-567 of the Michigan Business Corporation Act,
directors and officers of a Michigan corporation may be entitled to
indemnification by the corporation against judgments, expenses, fines, and
amounts paid by the director or officer in settlement of claims brought against
them by third persons or by or in the right of the corporation if those
directors and officers acted in good faith and in a manner reasonably believed
to be in, or not opposed to, the best interests of the corporation or its
shareholders.
The Registrant is obligated under its Articles of Incorporation and
Bylaws to indemnify a present or former director or executive officer of the
Registrant, and may indemnify any other person, to the fullest extent now or
hereafter permitted by law in connection with any actual or threatened civil,
criminal, administrative, or investigative action, suit or proceeding arising
out of their past or future service to the Registrant or a subsidiary, or to
another organization at the request of the Registrant or a subsidiary. The
Registrant and its directors and officers in their capacities as such are
insured against liability for wrongful acts.
15
<PAGE> 17
Item 16. Exhibits.
The following exhibits have been filed as part of this registration
statement:
Exhibit Number Description
-------------- -----------
5 Opinion of Counsel.
21 Subsidiary of Registrant.
23(a) Consent of Crowe Chizek.
(b) Consent of Counsel (see Exhibit 5).
99(a) Authorization Card.
(b) Letter to Shareholders Concerning Plan.
(c) Summary Brochure Describing Plan.
(d) The Commercial National Financial
Corporation Dividend Reinvestment Plan is
set forth in full in the Prospectus.
Item 17. Undertakings
(a) The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registrant
Statement:
(i) to include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) to reflect in the Prospectus any facts or
events arising after the effective date of the Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the
Registrant Statement; and
(iii) to include any material information with
respect to the plan of distribution not previously disclosed
in the Registration Statement or any material change to such
information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to
16
<PAGE> 18
be a new registration statement relating to the securities
offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of the
offering.
(b) The Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the Registration Statement shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
17
<PAGE> 19
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Ithaca, State of Michigan, on the 24th day of June,
1999.
COMMERCIAL NATIONAL FINANCIAL
CORPORATION
By: /s/ Jeffrey S. Barker
---------------------------------------
Jeffrey S. Barker
Its: President and Chief Executive Officer
18
<PAGE> 20
Pursuant to the requirements of the Securities Act of 1933, this
Form S-3 Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Date Name and Title
---- --------------
<S> <C>
/s/ Jeffrey S. Barker
June 24, 1999 ------------------------------------------------
Jeffrey S. Barker
President, Chief Executive Officer and
Director (Principal executive officer)
/s/ Patrick G. Duffy
June 24, 1999 ------------------------------------------------
Patrick G. Duffy
Vice President, Chief Financial Officer and
Director (Principal financial and accounting
officer)
/s/ Richard F. Abbott
June 24, 1999 ------------------------------------------------
Richard F. Abbott
Director
/s/ Jefferson P. Arnold
June 24, 1999 ------------------------------------------------
Jefferson P. Arnold
Director
/s/ Donald J. Dewey
June 24, 1999 ------------------------------------------------
Donald J. Dewey
Director
/s/ David A. Ferguson
June 24, 1999 ------------------------------------------------
David A. Ferguson
Director
/s/ Kenneth R. Luneack
June 24, 1999 ------------------------------------------------
Kenneth R. Luneack
Director
/s/ Kim C. Newson
June 24, 1999 ------------------------------------------------
Kim C. Newson
Director
/s/ Howard D. Poindexter
June 24, 1999 ------------------------------------------------
Howard D. Poindexter
Director
/s/ Scott E. Sheldon
June 24, 1999 ------------------------------------------------
Scott E. Sheldon
Director
/s/ Russell M. Simmet
June 24, 1999 ------------------------------------------------
Russell M. Simmet
Director
</TABLE>
19
<PAGE> 21
EXHIBITS
Exhibit Number Description
-------------- -----------
5 Opinion of Counsel.
21 Subsidiary of Registrant.
23(a) Consent of Crowe Chizek.
(b) Consent of Counsel (see Exhibit 5).
99(a) Authorization Card.
(b) Letter to Shareholders Concerning Plan.
(c) Summary Brochure Describing Plan.
(d) The Commercial National Financial
Corporation Dividend Reinvestment Plan is
set forth in full in the Prospectus.
<PAGE> 1
EXHIBIT 5
[FOSTER, SWIFT, COLLINS & SMITH, P.C. LETTERHEAD]
June 22, 1999
Commercial National
Financial Corporation
101 North Pine River
Ithaca, MI 48847
Dear Gentlemen:
Re: Commercial National Financial Corporation
Registration Statement on Form S-3
You have requested our opinion as counsel to Commercial National Financial
Corporation, a Michigan corporation, in connection with a Registration Statement
filed with the Securities and Exchange Commission under the Securities Act of
1933, as amended, on Form S-3. The Registration Statement relates to the
offering of an additional 50,000 shares of Commercial National Financial
Corporation common stock to be issued to stockholders in connection with the
Commercial National Financial Corporation Dividend Reinvestment Plan.
Based upon such examination and upon examination of such other instruments and
records as we deem necessary, we are of the opinion that:
1. The Corporation has been duly incorporated under the laws of the State
of Michigan, and is validly existing and in good standing under the
laws of that state.
2. The 50,000 shares of common stock covered by this Registration
Statement have been legally authorized; and when such shares have been
duly delivered to stockholders against payment therefore as
contemplated by the Commercial National Financial Corporation Dividend
Reinvestment Plan, such shares will be legally issued, fully paid and
nonassessable.
This opinion is furnished for use as an Exhibit to the Registration Statement.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement.
FOSTER, SWIFT, COLLINS & SMITH, P.C.
/s/ Foster, Swift, Collins & Smith, P.C.
<PAGE> 1
EXHIBIT 21
Commercial Bank, a Michigan banking corporation, wholly owned by Commercial
National Financial Corporation
<PAGE> 1
EXHIBIT 23(a)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement of
Commercial National Financial Corporation on Form S-3, of our report dated
February 4, 1999 on the consolidated financial statements of Commercial
National Financial Corporation, which report is included in the 1998 Annual
Report on Form 10-K of Commercial National Financial Corporation.
CROWE, CHIZEK AND COMPANY LLP
Crowe, Chizek and Company LLP
South Bend, Indiana
June 23, 1999
<PAGE> 1
EXHIBIT 99 (a)
AUTHORIZATION FORM
PLEASE READ CAREFULLY BEFORE SIGNING
I hereby appoint Commercial Bank as my agent under the terms and conditions of
the Dividend Reinvestment Plan, as described in the Prospectus accompanied this
Authorization Form, to receive any cash dividends that may become payable to me
on my shares of Commercial National Financial Corporation Common Stock and to
apply such dividends to the purchase of shares as provided in the Plan.
I hereby represent and confirm that I am the holder of record of shares of
common stock of Commercial National Financial Corporation and the principal
residence is in the state or country shown below. I hereby undertake to promptly
notify Commercial Bank if my state or country of resident changes.
I acknowledge receipt of the Commercial National Financial Corporation Dividend
Reinvestment Plan Prospectus and agree to the terms and conditions of the Plan
stated in that Prospectus.
I understand that I may revoke this authorization at any time by notifying
Commercial Bank in writing of my desire to terminate my participation.
DATE
-------------------------------------
- ------------------------------------ -------------------------------------
Shareholder Signature State or country (if other than
the United States) of residence
- ------------------------------------ -------------------------------------
Joint Shareholder Signature State or country (if other than
(if jointly held) the United States) of residence
if jointly held)
<PAGE> 2
THIS IS NOT A PROXY
Return this card only if you wish to join the Plan. An addressed postage paid
envelope is provided for that purpose. All owners of joint registration must
sign. When signing as trustee, guardian, executor, administrator, or corporate
officer, please give your full title.
- --------------------------------------------------------------------------------
(IF BENEFICIAL OWNER IS OTHER THAN THE HOLDER OF RECORD)
In addition to the above statements and representations, I hereby represent and
confirm that I am the broker or nominee of the beneficial owner of certain
shares of common stock of Commercial National Financial Corporation and that the
beneficial owner principally resides in the state or country (if other than the
United States) of . I hereby undertake to promptly notify
----------------------
Commercial Bank if the state or country of residence of the beneficial owner
changes.
----------------------------------
Broker or Nominee
<PAGE> 1
EXHIBIT 99 (b)
To Our Shareholders:
We are pleased to report that a Dividend Investment Plan is available which
enables you to increase your investment in Commercial National Financial
Corporation Common Stock in a convenient, economical manner. If you decide to
participate in the Plan, your dividends will be invested automatically in
additional shares of Commercial National Financial Corporation Common Stock.
The provisions of the Dividend Investment Plan are detailed in this brochure.
Your participation, of course, is voluntary and you may enroll or withdraw at
any time.
If after reviewing the features of the Plan you wish to participate, merely
complete and return the enclosed Authorization card.
Sincerely
Mr. Jeffrey S. Barker
President and Chief Executive Officer
Commercial National Financial Corporation
<PAGE> 1
EXHIBIT 99(c)
COMMERCIAL NATIONAL FINANCIAL CORPORATION
101 N. Pine River St.
Ithaca, MI 48847
Phone (517) 875-4144
Automatic Dividend Reinvestment Plan
<PAGE> 2
HOW TO PARTICIPATE
This brochure summarizes the principal benefits and features of the plan.
Participation in the plan is offered only by means of a prospectus which
accompanies this brochure and which describes the plan in detail. You should be
sure to read the prospectus before you decide whether to participate.
After reading the prospectus, simply complete and sign the enclosed
Authorization Form and return it in the postage-paid envelope provided.
Your participation will begin with the next dividend payment, provided the form
is received on or before the record date. Authorizations received after the
record date will delay your participation until the following dividend.
Any questions concerning the Plan or requests for copies of the prospectus
should be addressed to:
Commercial Bank Dividend Reinvestment Department
101 North Pine River Street
Ithaca, MI 48847
Telephone inquiries may be made to the bank at
(517) 875-4144.
COMMERCIAL NATIONAL FINANCIAL
CORPORATION
<PAGE> 3
SHAREHOLDER
BENEFITS
*You can increase your holdings of Commercial National Financial Corporation
common stock with no brokerage fees or service charges.
*All your purchases will be entitled to a 5% discount off the current market
price, enabling you to accumulate shares at a savings only available to
shareholders.
*Your increased holdings generate additional dividend income.
*Your dividends go directly to Commercial Bank who acts as agent under the Plan.
These dividends are fully invested because the Plan allows fractions of shares
to be credited to your account.
*Your personal record keeping is simplified by a detailed account statement sent
to you quarterly.
*You may join the Plan or terminate participation at any time. The Plan is
entirely voluntary.
HOW THE PLAN WORKS
1. The Plan is offered only by means of a prospectus through the Corporation's
Stock Transfer Agent, Commercial Bank. It will make stock purchases for you
in accordance with the Plan.
2. Once you have completed, signed, and returned the enclosed Authorization
Form, reinvestment of your dividends is automatic. Commercial Bank, as you
agent, will receive all dividends on both the shares you hold directly and
those acquired for you through the Plan. Dividends will be used to purchase
Commercial National Financial Corporation common stock at the market price
less a 5% discount.
3. If the total of your dividends is not large enough to buy a full additional
share, your account will be credited with a fractional share, computed to
four decimal places.
4. For your convenience, Commercial Bank will hold in safekeeping the shares
it has purchased for you. However, upon your written request, Commercial
Bank will issue to you, at any time and without charge, certificates for
the full shares acquired for you through the Plan.
5. You will receive a detailed statement of your account quarterly, showing
total dividends, shares purchased, and total shares held in your name.
6. You may terminate your participation in the Plan at any time by notifying
Commercial Bank in writing; however, your request to terminate or withdraw
shares must be received at least 10 days before the record date for a
dividend or it will not become effective until after that dividend has been
paid and reinvested. Upon termination, all whole shares credited to your
account and cash payment for any fractional share will be sent to you. You
may rejoin the Plan again at any time. If you so elect, Commercial Bank
will sell your shares and forward the proceeds, less brokerage commissions,
directly to you.
7. The Corporation reserves the right to amend, suspend, modify, or terminate
the Plan at any time. You will receive written notice of any such action.
8. You can vote all the shares held for you by Commercial Bank in your
dividend reinvestment account. Commercial Bank will forward proxy materials
and voting instructions to you prior to any shareholder meeting.
