SCHEDULE 14A
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exhange Act of 1934
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement
( ) Confidential, for Use of the Commission Only (as permitted
by rule 14a-6(e)(2))
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to 240.14a-11(c) or
240.14a-12
COMMERCIAL NATIONAL FINANCIAL CORPORATION
-----------------------------------------
(Name of Registrant as Specified In Its Charter)
NONE
----
(Name of Person(s) Filing Statement if other than the Registrant
Payment of Filing Fee (Check the appropriate box):
(X) No fee required.
( ) Fee computed on table below per Exchange Act Rules 14a-
6(i)(4) and 0-11.
1) Title of each class of securities to which transaction
applies.
2) Aggregate number of securities to which transaction
applies.
3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act
Rule 0-11 (Set forth the amount on which the filing
fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials
( ) Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
COMMERCIAL NATIONAL FINANCIAL CORPORATION
Latrobe, Pennysvania
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 18, 2000
TO THE SHAREHOLDERS:
Notice is hereby given that the annual meeting of
shareholders of Commercial National Financial Corporation will be
held at its office, 900 Ligonier Street, Latrobe, Pennsylvania,
on Tuesday, April 18, 2000 at 2:00 P.M. for the following
purposes:
- Election of five directors each for a term of
three years; and
- Ratification of the appointment of Stokes Kelly & Hinds,
LLC as independent auditors for the corporation; and
- Transaction of such other business as may come properly
before the meeting, and any adjournment or postponement
thereof.
Only those shareholders of record as of the close of
business on March 17, 2000 shall be entitled to notice of and to
vote at the meeting.
Enclosed are a proxy statement, a form of proxy and an
addressed return envelope. Please mark, date, sign and promptly
return the proxy in the envelope provided whether or not you plan
to attend the meeting in person. If you do attend the meeting, you
may then withdraw your proxy and vote in person. Your prompt response
will be appreciated.
By Order of the Board of Directors
/s/ Wendy S. Schmucker
Wendy S. Schmucker, Secretary
March 20, 2000
<PAGE>
(All text in the proxy statement is in two-column format except for
tables and graphs which occupy the full width of the page.)
COMMERCIAL NATIONAL FINANCIAL CORPORATION
900 Ligonier Street
Latrobe, Pennsylvania 15650
________________________________________
PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON April 18, 2000
GENERAL
This proxy statement is provided for the solicitation of
proxies by the board of directors of Commercial National
Financial Corporation (the corporation), a Pennsylvania business
corporation and bank holding company, for use at the annual
meeting of shareholders on April 18, 2000 and at any and all
adjournments or postponements thereof. This proxy statement and
the form of proxy, together with the annual report to
shareholders for 1999, are being mailed on March 20, 2000, or as
soon thereafter as possible, to all shareholders entitled to vote
at the annual meeting.
The only class of stock of the corporation presently issued
and outstanding is common stock. The total number of shares of
common stock entitled to vote at the annual meeting is 3,527,568
and only those shareholders of record at the close of business on
March 17, 2000 are entitled to vote.
The shares of stock represented by each proxy properly
signed and returned to the corporation prior to the date of the
annual meeting, will be voted in the manner set forth in this
proxy statement and in accordance with the instructions marked on
the proxy enclosed.
A shareholder who returns a proxy may revoke it at any time
before it is voted, by delivering a written notice of revocation
to Wendy S. Schmucker, secretary of the corporation, or by
executing a later dated proxy and giving written notice thereof
to the secretary of the corporation or by voting in person at the
meeting after giving written notice to the secretary of the
corporation.
The cost of preparing, printing, and soliciting proxies will
be paid by the corporation. In addition to the use of the mails,
certain directors, officers and employees of the corporation may
solicit proxies personally by telephone. Arrangements will be made
with brokerage houses and other custodians, fiduciaries and nominees
to forward proxy solicitation materials to the beneficial owners of
stock held of record by these persons, and, upon request therefore, the
corporation will reimburse them for reasonable forwarding expenses.
At the meeting, the shareholders will
- act upon the proposal to elect as directors the five persons
set forth in this proxy statement each in a class of directors as
set forth below in the following pages;
- ratify the appointment of Stokes Kelly and Hinds, LLC
as independent auditors for the corporation; and
- act upon any other business as may be properly brought before
the meeting.
The board of directors of the corporation recommends the
election, as directors, of the five nominees listed in this
proxy statement. The five nominees receiving the highest number
of votes cast, including votes cast cumulatively, shall be elected
directors. For all other purposes, other than election of
directors, each share of stock is entitled to one vote.
Under the bylaws of the corporation, the presence, in
person or by proxy, of shareholders entitled to cast at least a
majority of the votes which all shareholders are entitled to
cast, shall constitute a quorum. Abstentions will be counted
as present for purposes of determining the existence of a
quorum. Abstentions and broker non-votes will be treated as
shares that neither are capable of being voted nor have been
voted and, accordingly, will have no effect on the outcome of
the vote on the election of directors or on the outcome of the
proposal to ratify the appointment of Stokes Kelly & Hinds, LLC.
<PAGE>
ELECTION OF DIRECTORS
The bylaws of the corporation provide that the board of
directors shall consist of not less than three directors, and
shall be classified into three classes, each class to be
elected for a term of three years. The board of directors,
within the limits set in the bylaws, may from time to time fix
the number of directors and the respective classifications. The
number of directors to constitute the entire board has been fixed
by the board of directors at fifteen with five directors
in each of three classes. At the annual meeting, there shall
be elected five directors as a class to serve until the
annual meeting of shareholders in the year 2003. The proxies
intend to vote for the election of the nominees listed on the
proxy and in this proxy statement. All of the nominees are now
and have been directors of the corporation and of Commercial
National Bank of Pennsylvania (the bank).
Other nominations for director may be made in accordance
with procedures set forth in section 9.1 of the bylaws of the
corporation which require written notice to the secretary of the
corporation of any such nomination at least sixty (60) days prior
to the date of any meeting of the shareholders for the election
of directors. Such notice shall contain the following
information to the extent known by the notifying shareholder:
- the name, address, and age of each proposed nominee;
- the principal occupation of each proposed nominee;
- the number of shares of the corporation owned by each
proposed nominee;
- the total number of shares of the corporation that
will be voted for each proposed nominee;
- the name and address of the notifying shareholder; and
- the number of shares of common stock of the corporation
owned by the notifying shareholder.
Nominations not made within the foregoing procedures may be
disregarded by the chairman at the annual shareholders' meeting.
Each nominee has consented to be named and to serve as a
director, if elected. If any nominee becomes unable to serve as
a director, the proxies named in the proxy will vote for a
substitute nominee selected and recommended by the board of
directors of the corporation.
The names and ages of the nominees, and the year each
nominee began continuous service as a director of the
corporation, together with the principal occupation of each at
present and for at least the previous five years, are as
follows:
<PAGE>
<TABLE>
<CAPTION>
AGE; PRINCIPAL OCCUPATION
FOR THE TERM DIRECTOR
NAME PAST FIVE YEARS EXPIRES SINCE
---- ------------------------ ------- -------
<S> <C> <C> <C>
Gregg E. Hunter(1) 41, vice chairman and chief 2003 1995
financial officer of the corporation
and the bank (1995 - present);
vice president/chief financial
officer of the bank (1994 - 1995)
Joedda M. Sampson 47, president and principal owner 2003 1999
Allegheny City Restorations, Inc.
a development corporation engaged in
restoring and developing historic
properties and operating business
entities that occupy them
Debra L. Spatola 43, president 2003 1997
Laurel Valley Foods, Inc.
Louis A. Steiner(2) 69, chairman of the board of the 2003 1990
corporation and the bank (1997 -
present); chairman of the board
and chief executive officer of the
corporation and the bank (1990 - 1997)
George V. Welty 53, attorney, partner 2003 1997
Flickinger and Welty
</TABLE>
No nominee is a director of any company, other than the
corporation, which is required to file reports with the
Securities and Exchange Commission.
[FN]
(1) Gregg E. Hunter, director and nominee, is the son of Dorothy
S. Hunter, director; nephew of Louis A. Steiner, director and
nominee; and cousin of Louis T. Steiner, director.
(2) Louis A. Steiner, director and nominee, is the brother of
Dorothy S. Hunter, director; father of Louis T. Steiner,
director; and uncle of Gregg E. Hunter, director and nominee.
<PAGE>
CONTINUING DIRECTORS
The remaining ten directors, named below, will continue
to serve in their respective classes. The following table, based
in part on information received from the respective directors and
in part on the records of the corporation, sets forth information
regarding each continuing director as of February 18, 2000.
<TABLE>
<CAPTION>
AGE; PRINCIPAL OCCUPATION
FOR THE TERM DIRECTOR
NAME PAST FIVE YEARS EXPIRES SINCE
---- --------------- ------- ------
<S> <C> <C> <C>
John T. Babilya 40, president, chief executive 2001 1999
officer and co-owner of
Arc-Weld, Inc., a precision
custom manufacturing firm
servicing steel, drilling,
coal, glass, electrical and
geo-environmental industries
George A. Conti, Jr. 61, attorney at law 2001 1996
Frank E. Jobe 78, retired, former 2001 1990
executive vice president
of the bank
Roy M. Landers 71, retired, former 2001 1990
executive vice president
R & L Development Company,
land development
C. Edward Wible 54, certified public accountant 2001 1995
Horner, Wible & Associates,
Certified Public Accountants
Richmond H. Ferguson 68, attorney at law 2002 1990
Dorothy S. Hunter(3) 75, vice president 2002 1990
Latrobe Foundry Machine &
Supply Company
John C. McClatchey 62, chief executive officer 2002 1990
JCM Industries, manufacturer
of hardwood lumber and pallets
Joseph A. Mosso 68, retire, former president 2002 1990
Mosso's Parmacy, Inc.
Louis T. Steiner(4) 38, vice chairman, president 2002 1995
and chief executive officer of
the corporation and the bank
(1998 - present); vice chairman
and chief executive officer of
the corporation and the bank
(1997 - 1998); vice chairman of
the corporation and the bank
(1995 - 1997)
<FN>
(3) Dorothy S. Hunter, director, is the sister of Louis A. Steiner,
director and nominee; mother of Gregg E. Hunter, director and
nominee; and aunt of Louis T. Steiner, director.
(4) Louis T. Steiner, director is the son of Louis A. Steiner,
director and nominee; nephew of Dorothy S. Hunter, director;
and cousin of Gregg E. Hunter, director and nominee.
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth, as of February 18, 2000, the
name and address of each person who owns of record, or who is
known by the board of directors, to be the beneficial owner of
more than five percent of the outstanding common stock, the
number of shares beneficially owned by such person, and the
percentage of the outstanding common stock so owned.
</TABLE>
<TABLE>
<CAPTION>
Percent of
Outstanding
Amount and Nature Common Stock
Name and Address of of Beneficial Beneficially
Beneficial Owner Ownership(1)(2) Owned
---------------- ----------- ------------
<S> <C> <C>
Louis A. Steiner 596,490 (3) 16.57%
R. D. 2, Box 197
Ligonier, PA 15658
Dorothy S. Hunter 183,000 (4) 5.08%
P. O. Box 28
Latrobe, PA 15650
Gregg E. Hunter 210,180 (5) 5.84%
P. O. Box 3
Latrobe, PA 15650
George A. Conti, Jr. 228,600 (6) 6.35%
101 North Main Street
Greensburg, PA 15601
</TABLE>
[FN]
(1) The securities "beneficially owned" by an individual are
determined in accordance with the definitions of "beneficial
ownership" set forth in the general rules and regulations of
the Securities and Exchange Commission and may include securities
owned by or for the individual's spouse and minor children and
any other relative who has the same home, as well as securities
to which the individual has or shares voting or investment power
or has the right to acquire beneficial ownership within 60 days
after February 18, 2000. Beneficial ownershipmay be disclaimed
as to certain of the securities.
(2) Information published by the directors and the corporation.
(3) Includes 223,830 shares held directly by Mr. Steiner; 900
shares held by his spouse, Barbara J. Steiner; 240,000 shares
held by Latrobe Foundry Machine & Supply Company and 131,760
shares held by Ridge Properties, Inc. Louis A. Steiner is the
president of each company.
(4) Includes 3,000 shares held directly by Mrs. Hunter and
180,000 shares held as co-trustee, The Hunter Stock Trust, with
shared voting and investment power.
(5) Includes 30,180 shares held directly by Mr. Hunter and
180,000 shares held as co-trustee, The Hunter Stock Trust, with
shared voting and investment power.
(6) Includes 3,000 shares held in street name by Mr. Conti; 600
shares held as co-trustee of the Conti Trust, with shared voting
and investment power; 79,260 shares held as trustee of the
Corazzi Trust; and 145,740 shares held as trustee of the Iorio
Trust, each with sole voting and investment power.
<PAGE>
BENEFICIAL OWNERSHIP BY OFFICERS, DIRECTORS AND NOMINEES
The following table sets forth as of February 18, 2000, the
amount and percentage of the common stock beneficially owned by
each director, nominee, named executive officer, and all
executive officers and directors of the corporation as a group.
<TABLE>
<CAPTION>
Name of Amount and Nature
Individual or of Beneficial Percent
Identity of Group Ownership (1) (2) of Class
----------------- ----------------- --------
<S> <C> <C>
John T. Babilya 2,503 .07%
George A. Conti, Jr. 228,600(3) 6.35%
Richmond H. Ferguson 5,820 .16%
Dorothy S. Hunter 183,000(4) 5.08%
Gregg E. Hunter 210,180(5) 5.84%
Frank E. Jobe 30,300 .84%
Roy M. Landers 37,700 1.05%
John C. McClatchey 3,000 .08%
Joseph A. Mosso 24,240 .67%
Joedda M. Sampson 1,000 .03%
Debra L. Spatola 1,200 .03%
Louis A. Steiner 596,490(6) 16.57%
Louis T. Steiner 21,432 .60%
George V. Welty 2,680 .07%
C. Edward Wible 2,000 .06%
All executive officers and
directors as a group
(15 directors, 4 officers,
16 persons in total) 1,170,205 32.51%
</TABLE>
[FN]
(1) The securities "beneficially owned" by an individual are
determined in accordance with the definitions of "beneficial
ownership" set forth in the general rules and regulations of
the Securities and Exchange Commission and may include
securities owned by or for the individual's spouse and minor
children and any other relative who has the same home, as
well as securities to which the individual has or shares
voting or investment power or has the right to acquire
beneficial ownership within sixty (60) days after
February 20, 1999. Beneficial ownership may be disclaimed
as to certain of the securities.
(2) Information furnished by the directors and the corporation.
(3) Includes 3,000 shares held in street name by Mr. Conti; 600
shares held as co-trustee of the Conti Trust, with shared
voting and investment power; 79,260 shares held as trustee
of the Corazzi Trust; and 145,740 shares held as trustee of
the Iorio Trust, each with sole voting and investment power.
(4) Includes 3,000 shares held directly by Mrs. Hunter and
180,000 shares held as co-trustee, The Hunter Stock Trust,
with shared voting and investment power.
(5) Includes 30,180 shares held directly by Mr. Hunter and
180,000 shares held as co-trustee, The Hunter Stock Trust,
with shared voting and investment power.
(6) Includes 223,830 shares held directly by Mr. Steiner; 900
shares held by his spouse, Barbara J. Steiner; 240,000
shares held by Latrobe Foundry Machine & Supply Company and
131,760 shares held by Ridge Properties, Inc. Louis A.
Steiner is the president of each company.
<PAGE>
CUMULATIVE VOTING FOR DIRECTORS
The Articles of Incorporation of the corporation provide
that cumulative voting rights shall exist with respect to the
election of directors. Each shareholder entitled to vote shall
have the right to vote the number of shares owned, for as many
persons as there are directors to be elected in each class, or to
cumulate such shares and give one nominee the whole number of
such votes, or distribute the votes among any two or more
nominees in each class. For all other purposes, each share is
entitled to one vote. Management of the corporation reserves the
right to instruct the proxy holders to vote cumulatively.
DIRECTORS' MEETINGS AND COMMITTEES
It is the policy of the corporation that the directors of
the corporation also serve as the directors of the bank. During
1999 the board of the corporation met six times and the board
of the bank met 13 times.
The board of the corporation has an audit committee which
consists of the same persons who serve on the audit committee of
the bank. The audit committee of the corporation met during 1999
at the same times and performed the same functions as the audit
committee of the bank described below. The corporation does not
have a nominating committee. The function of a nominating
committee is performed by the full board.
The corporation has an executive compensation committee
whose functions are described below in the executive compensation
report. In 1999 the committee met two times.
<PAGE>
COMMITTEES OF THE BOARD OF THE BANK
The bylaws of the bank provide for an audit committee,
executive committee, asset quality committee and trust and trust
investment committee. The bank does not have a nominating committee.
That function is performed by the full board. The bank does not have
a compensation committee. That function is performed by the executive
compensation committee of the corporation.
The audit committee currently consists of George A. Conti, Jr.,
Debra L. Spatola and C. Edward Wible, all directors, appointed
by the board. The committee meets quarterly, or more often as
needed, with the internal auditor and staff to monitor and review
bank compliance with regulations and internal policies and procedures
and provides direct liason with the audit department and the
board of directors. The trust audit committee reviews all controls
and procedures of the trust division and the committees of the trust
division. The committee meets with the bank's independent auditors
as it deems necessary not less often than annually. During 1999 the
committee held four meetings.
The executive committee consists of the chairman, Louis A.
Steiner; the vice chairman, president and chief executive officer,
Louis T. Steiner; and the vice chairman and chief financial officer,
Gregg E. Hunter; together with directors Dorothy S. Hunter, Roy M.
Landers, John C. McClatchey and Joseph A. Mosso. The committee meets
monthly to review long- and short-term operating plans for the bank
and related matters and prepare recommendations for appropriate
board consideration and action. During 1999 the committee held
12 meetings.
The asset quality committee consists of the chairman,
Louis A. Steiner; the vice chairman, president and chief executive
officer, Louis T. Steiner; and the vice chairman and chief financial
officer, Gregg E. Hunter; together with directors John T. Babilya,
Richmond H. Ferguson, Frank E. Jobe and Joedda M. Sampson. The
committee meets quarterly to monitor loan and securities investments
to assure conformance with internal policy and all applicable
governmental regulations. During 1999 the committee held four
meetings.
The trust committee and trust investment committee, each
consists of not less than five members appointed by the
chairman of the board. The members of each committee are
chairman, Louis A. Steiner; vice chairman, president and chief
executive officer, Louis T. Steiner; and directors Frank E. Jobe and
George V. Welty; together with Barry W. Morris and Edward J.
Smith, advisory committee members. Each committee meets monthly,
concurrently, to monitor and review all activities and functions
of the trust division. During 1999 the committees held 11 meetings.
<PAGE>
ATTENDANCE AT MEETINGS
During 1999 all directors attended at least 75 percent of the
combined total of meetings of the board of directors and each committee
of which they were a member.
COMPENSATION OF DIRECTORS
Directors of the corporation and the bank are paid a fee of
$500 for attendance at meetings of the board of directors of the
corporation and the bank, and in addition, directors who are not
also officers of the bank are paid $190 for attendance at monthly
meetings and $270 for attendance at quarterly meetings of the
committees of the bank.
<PAGE>
EXECUTIVE COMPENSATION REPORT
To Our Shareholders:
Compensation for the executives of the corporation and its
wholly-owned subsidiary, the bank, is set and paid at the bank
level. The executive compensation committee had the
responsibility and authority to establish executive compensation
for 1999.
The executive compensation committee is composed of three
independent non-employee directors, none of whom are former
officers of the corporation or the bank. The committee is
responsible for setting executive officer salaries and
authorizing executive participation in the employee incentive
programs. The following report describes the actions of the
committee regarding the compensation paid to the executive
officers by the bank during 1999. No compensation was paid by
the corporation to its executive officers.
The bank's executive salary structure is based upon
independent banking industry surveys which focus on banks similar
in size, scope and geographic region to the bank. In addition,
the relative value of each management position to every other
management position is determined by the human resources
department. Using this data, a base salary, midpoint and range
is established for each position. The midpoint serves as a base
salary target for executives performing their jobs competently.
In general, the bank's base salary midpoints are above the median
of relevant competitive institutions. Salary increases are based
on individual performance and actual salary level relative to the
midpoint of the incumbent's salary range.
Salary decisions are based on performance criteria which
include the corporation's earnings over the previous five-year
period and the executive's success in managing risk, optimizing
income, controlling operating costs, improving service quality,
developing management leadership and strengthening the
institution's competitive position. The committee also considers
the extent to which such goals as after-tax income as a
percentage of average total assets, annual total asset growth,
and the capital ratios were met.
1999 was a transition year for the bank's incentive program.
Two plans were in effect during 1999. The first plan, combining
management incentive compensation and performance pay, was in
effect from January 1, 1999, through June 30, 1999. Effective
July 1, 1999, that plan was replaced by by job-specific variable
compensation plans. The incentive plan for key executives as
developed to provide a more direct link between bank performance
and a variable compensation opportunity for eligible participants
if the bank meets or exceeds key financial measures.
After-tax return on average assets and a after-tax net earnings
increase targets for the plan year. Thresholds of performance must
be met or exceeded before payouts occur from the plan. Payout cycles
occur on both quarterly and annual cycles. Payouts, if earned, will
be as a percentage of overall base salary earned either during a
quarter or during the year - up to 20 percent quarterly and up to
8 percent annually.
Executives also participate in the corporation's employee
profit sharing plan described elsewhere in the proxy statement.
On December 8, 1998, the committee set the 1999
compensation for Louis A. Steiner, chairman; and Louis T. Steiner,
vice chairman, president and chief executive officer, as shown in
this proxy statement.
The compensation reported consists of base salaries and other
compensation paid in 1999 and annual bonuses and profit sharing
earned in 1999 as determined by the bank's 1999 performance.
EXECUTIVE COMPENSATION COMMITTEE
Roy M. Landers
John C. McClatchey
Joseph A. Mosso
<PAGE>
EXECUTIVE OFFICERS' COMPENSATION
The corporation has not paid compensation of any kind to any
officer of the corporation. All compensation was paid by the
bank, a subsidiary of the corporation.
The following table sets forth certain information regarding
compensation received by the chief executive officer during 1999
and the remaining executive officers of the corporation whose total
annual salary and bonus exceeded $100,000 for the period indicated.
<TABLE>
SUMMARY COMPENSATION TABLE
Annual Compensation
<CAPTION>
Name And Annual Profit
Principal Position Year Salary Bonus Sharing
- ------------------ ---- ------ ----- -------
<S> <C> <C> <C> <C>
LOUIS A. STEINER
chairman of the board 1999 114,212 16,873 18,502
of directors of the
corporation and bank 1998 109,412 6,403 17,306
1997 118,524 5,962 18,642
LOUIS T. STEINER
vice chairman, 1999 121,526 17,882 19,981
president and chief
executive officer of 1998 114,095 6,496 17,775
the corporation and
bank 1997 73,555 4,403 11,634
GREGG E. HUNTER
vice chairman and 1999 103,036 15,328 16,759
chief financial officer
of the corporation 1998 96,779 5,915 15,169
and bank
1997 74,850 4,347 11,835
<PAGE>
PERFORMANCE GRAPH
(Graphic material has been omitted from this section. The
information is being presented in tabular form.)
The following graph compares the corporation's cumulative
total shareholder returns with the performance of the Nasdaq
Stock Market Index (U.S. Companies) and with the Nasdaq Bank
Stocks Index.
</TABLE>
<TABLE>
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
<CAPTION>
DATE CNAF NASDAQ U.S. CO. NASDAQ BANKS
<S> <C> <C> <C>
1994 100.00 100.00 100.00
1995 116.03 141.32 149.02
1996 210.98 173.87 196.75
1997 218.01 213.05 329.42
1998 243.93 300.22 327.15
1999 232.95 542.37 314.45
</TABLE>
[FN]
Assumes that the value of the investment in CNFC Common
Stock and each index was $100 on December 31, 1994 and that all
dividends were reinvested.
<PAGE>
PROFIT SHARING PLAN
The Employee Profit Sharing Retirement Plan (the plan) of
the bank was created in 1977 and restated in 1984. The plan
covers all employees who are employed for at least 1,000 hours
per year beginning on the first day of the month after completing
one year of service with the bank. The amount to be contributed
is determined by the board of directors of the bank and is a
percentage of the net profits of the bank. The total amount of
the annual contribution cannot exceed fifteen percent of
the total eligible compensation paid by the bank to all
participating employees. There are no contributions made by the
participating employees.
The plan provides for the determination of an account for
each participating employee with notice of the amount in that
account to be given to the participating employee annually.
Distributions under the plan can be made to participating
employees upon retirement (either normal or early retirement as
defined in the plan), at death or disability of the participating
employee or upon severing employment if either partially or fully
vested.
The plan provides for percentage vesting of 20 percent
for the first full three years of service increasing annually
thereafter 100 percent vesting after seven full years of
participation. The plan provides rules in the event it becomes
top-heavy. The funds contributed into the plan by the bank will
be administered and invested by and under the discretion of the
trustees (not less than three) who are appointed by the directors
of the bank.
It is not possible to determine the extent of the benefits
which any participant may be entitled to receive under the plan
on the date of termination of employment, since the amount of
such benefits will be dependent, among other things, upon the
future earnings of the bank, the future compensation of the
participants and the future earnings under the plan.
<PAGE>
TRANSACTIONS WITH DIRECTORS, NOMINEES, OFFICERS AND ASSOCIATES
In the ordinary course of its banking business, the bank has
and anticipates that it will continue to have transactions with
certain directors and officers of the corporation and the bank
and their associates.
To the extent such transactions consisted of extensions of
credit of any material amount, they have been made in the ordinary
course of the bank's business on substantially the same terms
including interest charged and collateral required as those
prevailing at the time for comparable transactions with other
customers of the bank and do not involve more than the normal risk
of collectibility or present other unfavorable features.
AUDITORS
Stokes Kelly & Hinds, LLC, was selected as the independent
auditors for the corporation for the fiscal year ending December 31,
1999, and was last elected by the shareholders of the corporation at the
annual meeting held on April 20, 1999. Stokes Kelly & Hinds, LLC
and its predecessor has certified the corporation's financial
statements for the fiscal year ended December 31, 1990, and all
fiscal years subsequent thereto.
The board of directors of the corporation at a meeting held
November 16, 1999 selected Stokes Kelly & Hinds, LLC as the independent
auditors for the corporation for 2000. A resolution will be presented
at the annual meeting for the ratification by the shareholders of the
appointment of Stokes Kelly & Hinds, LLC as the independent auditors for
the corporation. The board of directors recommends the shareholders
vote in favor of the resolution. The accounting fees are paid by the
corporation to independent auditors and represent payment for
auditing services only.
The auditors render no other type of service to the corporation
or the bank, and no service to any director or principal officer
of the corporation or the bank. There is no agreement to place
any limit on current or future auditors' fees.
A representative of Stokes Kelly & Hinds, LLC will be present
at the annual meeting of shareholders with the opportunity to
make statements and to respond to appropriate questions from
shareholders.
<PAGE>
SHAREHOLDER PROPOSALS - ANNUAL MEETING
Any shareholder who, in accordance with and subject to the
provisions of the proxy rules of the Securities and Exchange
Commission, wishes to submit a proposal for inclusion in the
corporation's proxy material for its annual meeting of
shareholders in the year 2001, must deliver such proposal in
writing to the chairman of the board of Commercial National
Financial Corporation at the office of the corporation, 900
Ligonier Street, Latrobe, Pennsylvania 15650, not later than
November 30, 2000.
OTHER MATTERS
The board of directors and the principal officers of the
corporation do not intend to present to the meeting any business
other than as set forth in the notice of annual meeting and this
proxy statement. The corporation knows of no other business to
be presented for action at the meeting. If, however, any other
business should properly come before the meeting, or any
adjournment thereof, the proxy holders intend to vote shares in
accordance with recommendations of the board of directors of the
corporation.
By Order of the Board of Directors
/s/ Wendy S. Schmucker
Wendy S. Schmucker, Secretary
<PAGE>
(The following proxy has been modified for electronic filing
purposes.)
COMMERCIAL NATIONAL FINANCIAL CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned appoints George A. Conti Jr., Debra L.
Spatola and C. Edward Wible and each of them, as true and
lawful proxies, with full power of substitution, to vote and
act for the undersigned at the annual meeting of shareholders
of the COMMERCIAL NATIONAL FINANCIAL CORPORATION to be held at
900 Ligonier Street, Latrobe, Pennsylvania, on April 18, 2000 at
2:00 P.M., and at any adjournment thereof, as fully as the
undersigned could vote and act if personally present on the
matters set forth on this proxy, and, in their discretion on such
other matters as may properly come before the meeting.
PLEASE SIGN AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
-----------, 2000
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------------------
Shareholders date
and sign here
exactly as name is
printed.
<PAGE>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR ON ALL
---
MATTERS UNLESS THE UNDERSIGNED SPECIFIES OTHERWISE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL ITEMS.
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FOR WITHHELD
1. Elect Gregg E. Hunter, Joedda M. Sampson, ( ) ( )
Debra L. Spatola, Louis A. Steiner and
George V. Welty, as directors, in a class
for a term expiring at the annual meeting
year 2003, EXCEPT VOTE WITHELD FROM FOLLOWING
NOMINEES:
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2. Ratify the appointment of Stokes FOR AGAINST ABSTAIN
Kelly & Hinds, LLC as independent ( ) ( ) ( )
auditors for the corporation.
