<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant / /
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
NSD BANCORP, INC,
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 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.
/ / 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:
* No fee required
<PAGE> 2
NSD BANCORP, INC.
5004 MCKNIGHT ROAD
PITTSBURGH, PENNSYLVANIA 15237
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 28, 1998
Notice is hereby given that the Annual Meeting of Shareholders of NSD
Bancorp, Inc. will be held in the Ballroom of the Holiday Inn, 4859 McKnight
Road, Pittsburgh, Pennsylvania, on April 28, 1998, at 3:00 P.M. Local Time, for
the following purposes:
(1) To vote upon the election of five persons to the Board of Directors of
the Corporation, to hold office for a two-year term and until their
successors are duly elected and qualified.
(2) To consider and act upon a proposal to amend Article 4 of the Articles
of Incorporation of the Corporation, as amended, to increase the number
of authorized shares of the Corporation's Common Stock, par value $1.00
per share, from 5,000,000 shares to 10,000,000 shares.
(3) To consider and act upon a proposal to add a new Article, Article 12 of
the Articles of Incorporation of the Corporation, as amended, to
provide that fundamental transactions, such as a merger, acquisition or
sale of all or substantially all of the assets of the Corporation,
requires the approval of 75% of the outstanding shares of the
Corporation unless first approved by 75% of the Board of Directors, in
which case the approval of only 51% of the outstanding shares is
required to approve the transaction, and to provide that the new
Article shall not be amended except by the affirmative vote of 75% of
the outstanding shares.
(4) To ratify the appointment of Deloitte & Touche, L.L.P., Certified
Public Accountants, as independent auditors and accountants for the
Corporation for the year ending December 31, 1998.
(5) To transact such other business as may properly come before the
meeting.
The Board of Directors has established the close of business on March 17,
1998, as the record date for the determination of shareholders entitled to
notice of and to vote at the Annual Meeting and any adjournment or postponement
thereof.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THIS MEETING REGARDLESS
OF THE NUMBER OF SHARES THAT YOU HOLD. PLEASE COMPLETE, SIGN AND DATE THE
ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED POSTAGE-PAID ENVELOPE, WHETHER OR
NOT YOU PLAN TO ATTEND THE MEETING.
By Order of the Board of Directors,
/s/ GLORIA J. BUSH
GLORIA J. BUSH
Secretary
March 30, 1998
<PAGE> 3
NSD BANCORP, INC.
5004 MCKNIGHT ROAD
PITTSBURGH, PENNSYLVANIA 15237
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
APRIL 28, 1998
GENERAL INFORMATION
This Proxy Statement is furnished to holders of Common Stock of NSD
Bancorp, Inc. (the "Corporation") in connection with the solicitation of Proxies
on behalf of the Board of Directors of the Corporation to be used at the Annual
Meeting of Shareholders (the "Annual Meeting") to be held on Tuesday, April 28,
1998, at the time and place and for the purposes set forth in the accompanying
Notice of Annual Meeting of Shareholders, and at any adjournment or postponement
thereof. The approximate mailing date of this Proxy Statement and the
accompanying Proxy is March 30, 1998.
The Corporation is a Pennsylvania business corporation and a bank holding
company registered with the Federal Reserve Board having its principal offices
at 5004 McKnight Road, Pittsburgh, Pennsylvania 15237, telephone (412) 231-6900.
The sole subsidiary of the Corporation is NorthSide Bank (the "Bank").
RECORD DATE, VOTING RIGHTS AND OUTSTANDING STOCK
Only holders of common stock of record at the close of business on March
17, 1998, will be entitled to notice of and to vote at the Annual Meeting. The
number of shares of common stock, par value $1.00 per share (the "Common Stock")
outstanding and entitled to vote as of the record date was 2,589,435. All share
amounts disclosed in this proxy statement have been adjusted to reflect the
effect of the three for two stock split paid December 31, 1997.
SOLICITATION AND VOTING OF PROXIES
Shares represented by proxies on the accompanying Proxy, if properly signed
and returned, will be voted in accordance with the specifications made thereon
by the shareholders. Any Proxy not specifying to the contrary will be voted FOR
the election of the nominees for First Class Director named below, FOR the
proposal to approve and adopt an amendment to Article 4 of the Articles of
Incorporation of the Corporation, as amended, to increase the number of
authorized shares of common stock of the Corporation to 10,000,000, FOR the
proposal to approve and adopt a new Article of the Articles of Incorporation of
the Corporation, as amended, to provide that fundamental transactions, require
the approval of 75% of the outstanding shares of the Corporation unless first
approved by 75% of the Board of Directors, in which case the approval of only
51% of the outstanding shares is required to approve the transaction and FOR
ratification of Deloitte & Touche, L.L.P., as independent public accountants for
the year ending December 31, 1998.
QUORUM
Under Pennsylvania law and the By-Laws of the Corporation, the presence of
a quorum is required for each matter to be acted upon at the Annual Meeting.
Pursuant to Article III, Section 3.04 of the By-Laws, the presence, in person or
by proxy, of shareholders entitled to cast at least a majority of the votes that
all shareholders are entitled to cast constitutes a quorum for the transaction
of business at the Annual Meeting. Votes withheld and abstentions will be
counted in determining the presence of a quorum for the particular matter.
Broker non-votes will not be counted in determining the presence of a quorum for
the particular matter as to which the broker withheld authority.
Assuming the presence of a quorum, the five (5) nominees for director
receiving the highest number of votes cast by shareholders entitled to vote for
the election of directors shall be elected. Votes withheld from a nominee
<PAGE> 4
and broker non-votes will not be cast for such nominee. Abstentions and broker
non-votes are not votes cast and therefore do not count either for or against
such election.
Assuming the presence of a quorum, the affirmative vote of a majority of
all votes by shareholders on such matter is required to approve and adopt the
proposed amendment to Article 4 of the Corporation's amended Articles of
Incorporation and to adopt proposed new Article 12. Abstentions and broker
non-votes are not votes cast and therefore, do not count either for or against
such approval and adoption. Abstentions and broker non-votes, however, have the
practical effect of reducing the number of affirmative votes required to achieve
a majority for each matter by reducing the total number of shares voted from
which the required percentage is calculated.
PRINCIPAL SHAREHOLDERS OF THE CORPORATION
The following table sets forth certain information concerning ownership of
the Corporation's Common Stock by persons known to the Corporation to be the
beneficial owner of more than 5% of the outstanding shares of the Corporation's
Common Stock as of March 17, 1998. Each such individual has sole voting and
investment power with respect to the shares listed except as otherwise indicated
in the footnotes to the table.
<TABLE>
<CAPTION>
PERCENTAGE OF
AMOUNT AND NATURE OF OUTSTANDING
NAME AND ADDRESS BENEFICIAL OWNERSHIP(A) COMMON STOCK
---------------- ----------------------- -------------
<S> <C> <C>
Estate of Carl H. Brandt 265,066 10.24%
2185 Ben Franklin Drive
Pittsburgh, PA 15237
William R. Baierl 231,672(b)(c) 8.95%
100 Federal Street
Pittsburgh, PA 15212
</TABLE>
- ---------
(a) 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 March 17,
1998. Beneficial ownership may be disclaimed as to certain of the
securities.
(b) Includes 100,246 shares owned by a company controlled by Mr. Baierl. Also
includes 9,181 shares held in trust as to which Mr. Baierl has voting and
dispositive power but disclaims beneficial ownership.
(c) Includes options to purchase 2,323 shares granted under the Corporation's
Non-Employee Director Stock Option Plan.
SHAREHOLDER PROPOSALS
Shareholders of the Corporation may submit proposals to be considered for
shareholder action at the Annual Meeting of Shareholders in 1999, if they do so
in accordance with the appropriate regulations of the Securities and Exchange
Commission. Any such proposal must be received by the Secretary of the
Corporation at the Corporation's address (listed on Page 1 of this Proxy
Statement) no later than November 29, 1998, in order to be included in the
Corporation's proxy materials relating to that meeting.
ELECTION OF DIRECTORS
(Proposal 1)
The Articles of Incorporation of the Corporation provide that the Board of
Directors of the Corporation shall be divided into two classes as nearly equal
in number as possible, with the term of office of one class expiring each year.
Five Directors of the First Class are to be elected at the Annual Meeting. Each
Director of the First Class will serve for a term of two years or until his or
her successor has been duly elected and has qualified.
Pursuant to the Corporation's Articles of Incorporation, voting rights for
the election of Directors are not cumulative. Each shareholder entitled to vote
has the right to cast one vote for each share of stock held for each of
2
<PAGE> 5
the candidates to be elected. To be elected, a Director must receive a majority
of the outstanding votes cast at the Annual Meeting.
The persons named in the enclosed Proxy will vote FOR the election of the
nominees named below unless authority is withheld. Each nominee has consented to
be named as a nominee and has agreed to serve if elected. If for any reason any
of the persons named below should become unavailable to serve (an event which
management does not presently anticipate), Proxies will be voted for the
remaining nominees and such other person or persons as the Board of Directors
may designate.
Set forth below are the names of the nominees for Director of the First
Class and the names of the Directors of the Second Class (Directors of the
Second Class are not standing for election at the Annual Meeting but will
continue in office after the Annual Meeting until the expiration of their
respective terms), together with certain information regarding each of them:
NOMINEES FOR DIRECTORS:
DIRECTORS OF THE FIRST CLASS--TERM EXPIRING IN 1998
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR EMPLOYMENT FOR AGE AS OF
PAST FIVE YEARS, AND ALL POSITIONS AND OFFICES MARCH 17, DIRECTOR
NAME WITH THE CORPORATION AND THE BANK 1998 SINCE (1)
---- --------------------------------- --------- ---------
<S> <C> <C> <C>
Nicholas C. Geanopulos....................... President of N.C. Geanopulos, Inc. (restaurant 49 1988
services) President of Geanopulos
Representations
Lloyd G. Gibson.............................. President and Chief Executive Officer of the 42 1993
Corporation and the Bank; President (and
former Executive Vice President) of the Miners
and Mechanics Savings and Trust Company in
Steubenville, Ohio (1991-1993)
Charles S. Lenzner........................... President Lenzner Tours and Airlines 48 1990
Transportation Co. (transportation services)
David W. McConnell........................... Executive Vice President, Chief Financial 43 1990
Officer and Treasurer of Allegheny Health,
Education & Research Foundation; Vice Chair
and Chief Executive Officer Allegheny
University Medical Practices; and Chief
Executive Officer of Diversified Health Group,
Inc.
Kenneth L. Rall.............................. President of D.S.C., Inc. and D.S.C. Services, 65 1987
Inc. (mobile home sales and service);
President International Service and Supply
Co.; and President Renaissance Home Sales,
Inc.
</TABLE>
- ---------
(1) Includes any service as a Director of the Bank prior to the formation of the
Corporation in 1993.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
ELECTION OF ALL NOMINEES FOR DIRECTOR.
3
<PAGE> 6
DIRECTORS CONTINUING IN OFFICE:
DIRECTORS OF THE SECOND CLASS--TERM EXPIRING IN 1999
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR EMPLOYMENT FOR AGE AS OF
PAST FIVE YEARS, AND ALL POSITIONS AND OFFICES MARCH 17, DIRECTOR
NAME WITH THE CORPORATION AND THE BANK 1998 SINCE (1)
---- --------------------------------- ---- ---------
<S> <C> <C> <C>
William R. Baierl............................ President and Chief Executive Officer of 69 1977
Baierl Chevrolet, Inc. (automobile dealership)
Grant A. Colton, Jr.......................... President, Corporate Director and Chief 57 1990
Executive Officer of GA Industries, Inc.
(valve manufacturer)
L.R. Gaus.................................... Managing Partner of L.R. Gaus and Associates, 65 1971
certified public accountants; Chairman of the
Board of the Corporation and the Bank
Polly B. Lechner............................. Educator--North Allegheny School District 56 1987
Arthur J. Rooney, II......................... President--Klett, Lieber, Rooney & Schorling 45 1988
</TABLE>
- ---------
(1) Includes any service as a director of the Bank prior to the formation of the
Corporation in 1993.
MEETINGS OF THE BOARD OF DIRECTORS AND STANDING COMMITTEES; DIRECTORS'
COMPENSATION
The Board of Directors of the Corporation met twelve times during 1997.
Each of the Directors, except Arthur J. Rooney, II, attended at least 75% of the
meetings of the Board of Directors.
The Board of Directors of the Corporation maintains an Audit Committee, a
Nominating Committee and a Stock Option Committee. The Corporation's Nominating
Committee consists of Grant A. Colton, Jr. (Chairman), Nicholas C. Geanopulos,
Charles S. Lenzner, and Arthur J. Rooney, II. It is expected that the Nominating
Committee of the Corporation will consider director candidates recommended by
shareholders who submit the candidate's resume by sending it to the Chairman of
the Nominating Committee at the Corporation's principal business address. The
Nominating Committee met one (l) time during 1997.
The Corporation's Audit Committee from April 22, 1997, consisted of Kenneth
L. Rall (Chairman), Charles S. Lenzner and Henry E. Rea, Jr. Prior to April 22,
1997, the Audit Committee consisted of Kenneth L. Rall (Chairman), Henry E. Rea,
Jr. and Charles S. Lenzner. This Committee met four times during 1997 to review
reports presented by the Corporation's auditors. This Committee also reviews the
reports prepared by regulatory authorities. The Committee makes suggestions to
management designed to improve internal control and to protect against improper
security for all assets and records.
The Corporation's Stock Option Committee consists of William R. Baierl, L.
R. Gaus, David W. McConnell, Henry E. Rea, Jr. and Arthur J. Rooney, II. The
Committee's function is to administer and approve stock option grants under the
1994 Stock Option Plan (the "Plan") and interpret the Plan and prescribe such
rules, regulations and procedures in connection with the operation of the Plan
as it shall deem to be necessary and advisable for the administration of the
Plan consistent with the purposes of the Plan. The Stock Option Committee met
one (1) time during 1997.
The Bank's Personnel Committee, which acts as a compensation committee for
the Corporation, met five times in 1997. Prior to April 22, 1997, the Committee
consisted of David W. McConnell (Chairman), L. R. Gaus, William R. Baierl, Lloyd
G. Gibson and Polly B. Lechner. As of April 22, 1997, this Committee consisted
of David W. McConnell (Chairman), William R. Baierl, L. R. Gaus, Lloyd G.
Gibson, and Polly B. Lechner. This Committee establishes terms of employment and
compensation of all officers of the Bank, reviews and
4
<PAGE> 7
recommends employee benefits, bonus or similar plans to the Board for its
approval and administers, construes and interprets any such plans (other than
the Plan).
Each non-employee director of the Bank is paid a fee of $800 per month base
rate plus $200 for each Bank Board of Directors meeting or committee meeting
attended, not to exceed $1,000 monthly except L. R. Gaus, who receives a fee of
$600 per month base rate only. Directors of the Corporation currently are not
paid for attendance at meetings of the Corporation's Board of Directors or
committees thereof. Non-employee Directors of the Corporation also receive
grants of stock options under the Corporation's Non-Employee Director Stock
Option Plan. In addition to the per meeting compensation, L. R. Gaus received
compensation in the amount of $24,000 during 1997, payable on a monthly basis,
for services rendered as Chairman of the Board of the Corporation.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Lloyd G. Gibson, President and Chief Executive Officer of the Corporation
and the Bank, is a member of the Personnel Committee of the Bank (which acts as
a compensation committee for the Corporation and the Bank). Mr. Gibson did not
participate in any deliberations of the Personnel Committee with regard to his
compensation during 1997.
EXECUTIVE OFFICERS OF THE CORPORATION
The following table sets forth the name, age, position held and business
experience of each executive officer of the Corporation.
<TABLE>
<CAPTION>
AGE AS OF
MARCH 17, POSITION HELD AND BUSINESS EXPERIENCE
NAME 1998 DURING LAST FIVE YEARS SINCE(A)
---- ---- ---------------------- --------
<S> <C> <C> <C>
Lloyd G. Gibson...................... 42 President and Chief Executive Officer of the 1993
Bank and the Corporation (1993-present);
President (and former Executive Vice
President) of The Miners and Mechanics
Savings and Trust Company in Steubenville,
Ohio (1991-1993)
Edward A. Balmer..................... 49 Executive Vice President of the Bank and Vice 1993
President of the Corporation (1993-present);
Vice President of Dollar Bank in Pittsburgh,
Pennsylvania
James R. Schafer..................... 55 Executive Vice President/Chief Operating 1989
Officer of the Bank (1989 to present)
James P. Radick...................... 35 Senior Vice President, Chief Financial 1993
Officer and Treasurer of the Bank and
Treasurer of the Corporation (1993-present);
and Chief Auditor of the Bank (1989-1993)
</TABLE>
- ---------
(a) Includes any service as an officer of the Bank prior to the formation of the
Corporation in 1993.
REMUNERATION OF MANAGEMENT
The following table is a summary of certain information concerning the
compensation awarded or paid to, or earned by, the Corporation's chief executive
officer during each of the last three fiscal years. No other executive officer
employed by the Corporation or the Bank received aggregate remuneration
exceeding $100,000 during 1997.
5
<PAGE> 8
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
--------------------
AWARDS PAYOUTS
---------- -------
(A) (B) (C) (D) (F) (G)
(E) RESTRICTED SECURITIES (H) (I)
OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION AWARD(S) OPTIONS/ PAYOUTS COMPENSATION
POSITION YEAR ($) ($) ($) ($) SARS(#) ($) ($)
------------------ ---- ------ ----- ------------ ---------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Lloyd G. Gibson, 1995 123,963 20,790 5,836(1) 0 6,615 0 10,162(2)
President and Chief 1996 124,378 25,000 6,392(1) 0 6,300 0 11,165(2)
Executive Officer 1997 134,408 15,000 7,135(1) 0 6,000 0 12,439(2)
</TABLE>
- ---------
(1) Represents the value of an automobile allowance.
(2) Represents amount of contributions by the Bank pursuant to the Bank's Profit
Sharing Plan ($6,697); ($6,473); and ($7,570) for 1995; 1996; and 1997 and
401(k) Plan employee matching contributions of ($3,465); ($4,692); and
($4,869) for 1995; 1996; and 1997.
Mr. Gibson serves as President and Chief Executive Officer under an
employment agreement with the Bank dated July 1, 1993, which is renewable for
additional one year periods after July 1, 1995. The agreement provides for an
initial employment term of two years with base compensation currently equal to
$137,808 annually (subject to review of the Board of Directors). In addition,
the agreement entitles Mr. Gibson to participate in any incentive compensation
program or stock option plan implemented by the Corporation or the Bank and
customary insurance and other benefit programs for executives of the Corporation
or the Bank. The agreement was renewed for an additional one year term in 1997,
that will expire July 1, 1998.
PERSONNEL COMMITTEE AND STOCK OPTION COMMITTEE REPORT ON
EXECUTIVE COMPENSATION
The Bank's Personnel Committee has acted, and continues to act, as a
compensation committee for the Bank and the Corporation since the Corporation, a
bank holding company organized in 1993, does not have any employees (executive
officers of the Corporation are employed and compensated by the Bank). The
central objective of the Bank's compensation policies is to provide fair and
reasonable compensation to all employees.
As a matter of long-standing, general practice, the base salaries payable
to the executive officers for their services in a particular year are fixed at
or about the beginning of the year, upon the recommendation of the Bank's
Personnel Committee and subject to approval by the Board of Directors of the
Corporation.
Under the Bank's compensation policy, base salaries for executive officers
are determined principally after consideration of (a) independently prepared pay
survey information for 24 other bank and thrift institutions having total assets
of $300 million to $499 million located in the eight county region comprising
Southwestern Pennsylvania; (b) internal performance reviews for each officer;
and (c) other criteria such as seniority and individual performance. The overall
performance of the Bank and the Corporation is a factor considered in
determining base salary only to the extent it reflects individual performance by
the officer; however, executive officers also were compensated during 1997 under
the Bank's Profit Sharing Plan, which provides for annual discretionary
contributions by the Bank based on the Bank's financial performance. For 1997,
salary increases were awarded to the executive officers which increases averaged
3.83%.
Lloyd G. Gibson, the Chief Executive Officer of the Corporation and the
Bank, was hired effective July 1, 1993 pursuant to an employment agreement which
set his base salary for the initial year of the agreement. Mr. Gibson received a
base salary increase of 6.00% effective July 1, 1997, to $137,808. This increase
was based on the Committee's review of pay survey information (as described
above), the salaries paid historically to previous Chief Executive Officers of
the Bank and the Committee's evaluation of his individual performance, in
particular, the current favorable financial performance of the Corporation
relative to the internal budget and also to peer group performance levels. Mr.
Gibson's compensation ranks at or about the 50th percentile of the
6
<PAGE> 9
comparative group of banks as listed in the L. R. Webber Associates, Inc. pay
survey described above. Mr. Gibson also participated in the Bank's Profit
Sharing Plan described above.
During 1997, the Stock Option Committee granted stock options covering an
aggregate of 13,500 shares of Common Stock to the Corporation's executive
officers, including options covering 6,000 shares granted to Mr. Gibson, the
Chief Executive Officer. The number of options granted to executive officers was
based primarily on the officer's relative position and the Committee's
assessment of the officer's value to the Corporation and the Bank and, to a
lesser extent, individual performance.
By the Members of the Personnel Committee:
David W. McConnell (Chairman), William R. Baierl, L.R. Gaus,
Lloyd G. Gibson and Polly B. Lechner
By the Members of the Stock Option Committee:
William R. Baierl, L. R. Gaus, David W. McConnell,
Arthur J. Rooney, II and Henry E. Rea, Jr.
EMPLOYEE BENEFIT PLANS
The following descriptions of certain employee benefit plans of the Bank
are summaries and do not purport to be complete. Such descriptions are qualified
in their entirety by the provisions of the respective plans.
401(K) PLAN. The NorthSide Bank 401(k) Plan was established January 1,
1995. Under the NorthSide Bank 401(k) Plan, employees of NorthSide Bank may
elect to participate in the 401(k) Plan after they have completed one year of
service, completed 1,000 hours of service and attained age 21. Those employees
who participate may elect to make a salary deferral contribution up to 15% of
compensation. The Bank will make a matching contribution equal to 50% of the
employee's salary deferral contribution. The amount of the Bank's matching
contribution, however, shall not exceed 6% of an employee's compensation.
NorthSide Bank may also elect to make a discretionary contribution which would
be allocated to participants who are employed on the last day of the plan year
(December 31) and have worked at least 1,000 hours in that same year. This
contribution would be allocated on a prorata basis using compensation. The
employees are always 100% vested in their salary deferral accounts. The vesting
for employee and employer matching accounts shall be: 33.33% for one year of
service; 66.67% for two years of service; and 100% for three years of service.
Upon termination, if the participant's account balance does not exceed $3,500,
he or she can receive his or her distribution in the first plan year following
the date of termination. If the employee's account balance exceeds $3,500, he or
she can receive his or her distribution as of any date following a one year
break in service (a plan year in which less than 501 hours are worked) or
attainment of normal retirement age. Future benefits cannot be estimated because
the benefits are contingent upon future events.
1994 STOCK OPTION PLAN
During 1997, a total of 18,375 stock options were granted under the
Corporation's 1994 Stock Option Plan (the "Plan") to 11 employees. During 1997,
8,211 stock options were exercised. The following tables set forth information
relating to stock options granted under the Plan to the Chief Executive Officer
of the Corporation during 1997 and the aggregate values of all options granted
under the Plan to the Chief Executive Officer as of December 31, 1997.
7
<PAGE> 10
OPTION GRANTS IN FISCAL YEAR 1997
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM (2)(3)
- ---------------------------------------------------------------------- --------------------------
PERCENT OF
TOTAL
OPTIONS
GRANTED TO EXERCISE
OPTIONS EMPLOYEES OR BASE
GRANTED IN FISCAL PRICE EXPIRATION
NAME (#) YEAR ($/SH) DATE (1) 5%($) 10%($)
(A) (B) (C) (D) (E) (F) (G)
---- ------- ---------- -------- ---------- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Lloyd G. Gibson......... 6000 32.7% $19.07 7/22/07 $186,349 $296,729
</TABLE>
- ---------
(1) Options granted on July 22, 1997, all of which were exercisable on the date
of grant.
(2) Based on the product of (a) the difference between (i) the per share market
price of the Common Stock on the date of the grant, compounded annually over
the term of the option (10 years) at the assumed annual rates indicated, and
(ii) the exercise price per share and (b) the number of shares of Common
Stock obtainable upon exercise of the option.
(3) Amounts shown were calculated at the assumed 5% and 10% annual rates
required by the Securities and Exchange Commission and are not intended as a
forecast of future appreciation in the price of the Common Stock.
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1997 AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
SHARES UNEXERCISED IN-THE-MONEY
ACQUIRED VALUE OPTIONS AT OPTIONS AT FISCAL
ON EXERCISE REALIZED FISCAL YEAR-END YEAR-END
NAME (#) ($) (#) ($)(1)
---- ----------- -------- --------------- -----------------
EXERCISABLE/ EXERCISABLE/
UNEXERCISABLE UNEXERCISABLE
------------- -------------
(A) (B) (C) (D) (E)
--- --- --- --- ---
<S> <C> <C> <C> <C>
Lloyd G. Gibson.................. N/A N/A 25,794/0 $443,887/0
--- --- -------- ----------
</TABLE>
- ---------
(1) Based on the closing price per share of Common Stock on the NASDAQ National
Market System as of December 31, 1997, minus the exercise price per share,
multiplied by the number of shares obtainable upon exercise of such options.
OWNERSHIP OF SECURITIES BY CORPORATION DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information as of March 17, 1998, regarding
the amount and nature of beneficial ownership of Common Stock by each of the
Directors of the Corporation, each of the executive officers listed in the
Summary Compensation Table above, and by all of the Directors and executive
officers of the
8
<PAGE> 11
Corporation as a group. Each such individual has sole voting and investment
power with respect to the shares listed except as otherwise indicated in the
footnotes to the table.
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENTAGE OF
NAME OF OF OUTSTANDING
BENEFICIAL OWNER BENEFICIAL OWNERSHIP COMMON STOCK(J)
---------------- -------------------- ---------------
<S> <C> <C> <C>
William R. Baierl....................... 231,672 (a)(g) 8.95%
Grant A. Colton, Jr..................... 95,232 (b)(g) 3.68%
L.R. Gaus............................... 32,583 (g) 1.26%
Nicholas C. Geanopulos.................. 6,397 (c)(g) --
Lloyd G. Gibson......................... 25,878 (d) 1.00%
Polly B. Lechner........................ 280,029 (e)(g) 10.81%
Charles S. Lenzner...................... 11,603 (c)(f)(g) --
David W. McConnell...................... 45,734 (g) 1.77%
Kenneth L. Rall......................... 19,157 (g)(h) --
Henry E. Rea, Jr........................ 282,122 (c)(e)(g) --
Arthur J. Rooney, II.................... 7,632 (g)(i) --
All Directors and executive officers of
the Corporation as a group (14
persons).............................. 802,710 31.00%
</TABLE>
- ---------
(a) Includes 100,246 shares owned by a company controlled by Mr. Baierl. Also
includes 9,181 shares held in trust as to which Mr. Baierl has voting and
dispositive power but disclaims beneficial ownership.
(b) Includes 60,081 shares owned by companies controlled by Mr. Colton, and
32,828 shares owned jointly by Mr. Colton and his wife as to which he shares
voting and investment power.
(c) These shares are jointly owned by the named individual and his spouse and
the named individual shares voting and investment power over such shares
with his spouse.
(d) Includes 25,794 stock options granted to Mr. Gibson.
(e) Includes 265,066 shares held in the Estate of H. Carl Brandt as to which Ms.
Lechner is a part beneficiary and Ms. Lechner and Mr. Rea are co-executors
in the estate.
(f) Includes 471 shares held in custodian accounts for children as to which Mr.
Lenzner shares voting power.
(g) Includes 2,323 stock options granted under the Corporation's Non-Employee
Director Stock Option Plan which are currently exercisable.
(h) Includes 6,957 shares held in a profit sharing plan as to which Mr. Rall
shares voting and dispositive power as co-trustee.
(i) Includes 2,853 shares held by an investment club as to which Mr. Rooney
shares voting power.
(j) Unless otherwise indicated, the number of shares owned does not exceed one
percent of the class.
TRANSACTIONS WITH DIRECTORS AND EXECUTIVE OFFICERS
Except as otherwise indicated, there have been no material transactions
between the Corporation and the Bank, nor any material transactions proposed,
with any director or executive officer of the Corporation and the Bank, or any
associate of the foregoing persons. The Corporation and the Bank have engaged in
and intend to continue to engage in banking and financial transactions in the
ordinary course of business with directors and officers of the Corporation and
the Bank and their associates on comparable terms and with similar interest
rates as those prevailing from time to time for other customers of the
Corporation and the Bank. Total loans outstanding from the Corporation and the
Bank at December 31, 1997, to the Corporation's and the Bank's officers and
directors as a group and to members of their immediate families and companies in
which they had an ownership interest of 10 percent or more was $5,919,061 or
approximately 19.5% percent of the total equity capital of the Bank. Such 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 other persons, and do not involve more
than the normal risk of collectibility or present other unfavorable features.
9
<PAGE> 12
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires each of the Corporation's Directors and executive
officers and each holder of more than 10% of the Corporation's Common Stock to
file with the Securities and Exchange Commission initial reports of his
ownership of, and periodic reports of his or her transactions in, the
Corporation's Common Stock. Based solely upon the Corporation's review of Forms
3, 4 and 5 and amendments thereto furnished to the Corporation for the fiscal
year ended December 31, 1997, and for written representations from certain
reporting persons that no Forms 5 were required for those persons, the
Corporation believes that, during the period January 1, 1997, through December
31, 1997, all reports of the Corporation's executive officers, directors and 10
percent shareholders were in compliance with all filing requirements applicable
to them, except for the following persons who inadvertently filed late reports
for three transactions to report the granting of stock options: William R.
Baierl, Edward A. Balmer, Gloria J. Bush, Grant A. Colton, Jr., L. R. Gaus,
Nicholas C. Geanopulos, Lloyd G. Gibson, Polly B. Lechner, Charles S. Lenzner,
David W. McConnell, James P. Radick, Kenneth L. Rall, Henry E. Rea, Jr., Arthur
J. Rooney II, and James R. Schafer.
PROPOSAL TO AMEND ARTICLE 4 OF THE ARTICLES OF INCORPORATION
OF THE CORPORATION, AS AMENDED, TO INCREASE THE NUMBER
OF AUTHORIZED SHARES OF COMMON STOCK
(Proposal 2)
The Articles of Incorporation of the Corporation, as amended, currently
authorize Five Million (5,000,000) shares of Common Stock, par value $1.00 per
share. As of March 17, 1998, there were 2,589,435 shares of Common Stock issued
and outstanding. The Corporation thus has only a limited number of authorized
but unissued shares available for issuance, from time to time, as may be
necessary in connection with future financings, investment opportunities,
acquisitions of other companies, the declaration of stock dividends, stock
splits or other distributions, or for other corporate purposes.
Accordingly, on February 24, 1998, the Board of Directors of the
Corporation approved resolutions to amend Article 4 of the Corporation's
Articles of Incorporation, as amended, to increase the number of authorized
shares of Common Stock from 5,000,000 shares to 10,000,000 shares. The increase
in the number of authorized shares of Common Stock requires that the
shareholders approve and adopt the proposed amendment to the Corporation's
Articles of Incorporation, as amended. A true and correct copy of the proposed
amendment to Article 4 of the Corporation's Articles of Incorporation, as
amended, and the resolutions approved and adopted by the Board of Directors are
set forth below:
NOW, THEREFORE, BE IT RESOLVED, that in accordance with Sections 1911,
1912, 1914, 1915 and 1916 of the Business Corporation Law of 1988, as amended,
the Board of Directors hereby approves and adopts the following proposed
amendment to the Corporation's Articles of Incorporation, as amended, and hereby
directs that the following proposed amendment to the Articles of Incorporation,
as amended, of this Corporation be submitted to the shareholders of the
Corporation for their approval and adoption at the 1998 Annual Meeting of
Shareholders of the Corporation to be held on April 28, 1998, at 3:00 p.m.,
prevailing time, at Pittsburgh, Pennsylvania, to wit:
Article 4 of the Articles of Incorporation, as amended, of NSD Bancorp,
Inc. is amended and restated to read in full and in its entirety as
follows:
4. The aggregate number of shares that the Corporation shall have authority
to issue is 10,000,000 shares of Common Stock of the par value of $1.00 per
share (the "Common Stock").
Except as described in this section of the Proxy Statement, the Corporation
has no present plans, understandings or arrangements for issuing the additional
shares to be authorized by the proposed amendment. The Board of Directors
believes that it is advisable to have authorization for such additional shares
in order to enable the Corporation, as the need may arise, to take prompt
advantage of market conditions and the availability of favorable opportunities
for the acquisition of other companies without the delay and expense incident to
the holding of a special meeting of shareholders of the Corporation. The future
issuance by the Corporation of shares of Common Stock may dilute the present
equity ownership position of current holders of the Common Stock. The
10
<PAGE> 13
proposed amendment is not intended to have an anti-takeover effect. The
issuance, however, of any of the shares proposed to be authorized, as well as
currently authorized but unissued shares, may potentially have an anti-takeover
effect by making it more difficult to obtain shareholder approval of actions
such as certain business combinations or removal of management.
The proposed amendment, if adopted by the shareholders, would increase the
number of authorized but unissued shares of Common Stock of the Corporation from
5,000,000 shares to 10,000,000 shares. The unissued shares of Common Stock will
be available for issuance at the discretion of the Board of Directors from time
to time for any proper corporate purposes generally without further action of
the shareholders upon the affirmative vote of a majority of the members of the
Board of Directors. If the proposed amendment is adopted by the shareholders,
the Board of Directors is not likely to solicit shareholder approval to issue
the additional authorized shares, except to the extent that such approval may be
required by law, regulation or any agreement governing the trading of the
Corporation's stock.
As a result, the Board of Directors proposes that Article 4 of the amended
Articles of Incorporation of the Corporation be amended and restated to read in
full and in its entirety as set forth above and that the shareholders approve
and adopt the following resolution:
RESOLVED, that the proposed amendment to Article 4 of the
Corporation's Articles of Incorporation, as amended, and as set forth in
its entirety above, be and hereby is, approved, adopted, ratified and
confirmed.
The affirmative vote of a majority of the votes cast by all shareholders
entitled to vote thereon is required to approve and adopt this amendment to the
Corporation's Articles of Incorporation, as set forth above.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE PROPOSAL TO
AMEND THE CORPORATION'S ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF
AUTHORIZED SHARES OF COMMON STOCK FROM 5,000,000 TO 10,000,000.
PROPOSAL TO APPROVE AND ADOPT A PROPOSED NEW ARTICLE,
ARTICLE 12 OF THE ARTICLES OF INCORPORATION OF THE
CORPORATION, AS AMENDED
(Proposal 3)
On February 24, 1998, the Board of Directors unanimously approved and
adopted resolutions to approve and adopt a proposed new Article, Article 12 of
the Articles of Incorporation of the Corporation, as amended, to provide that
fundamental transactions, such as a merger, acquisition or sale of all or
substantially all of the assets of the corporation, requires the approval of 75%
of the outstanding shares of the corporation unless first approved by 75% of the
members of the Board of Directors, in which case the approval of only 51% of the
outstanding shares is required to approve the transaction. In addition, the new
Article could only be amended with the approval of the holders of 75% of the
outstanding shares of the Corporation. The addition of this new article to the
Corporation's amended Articles of Incorporation requires that the shareholders
approve and adopt proposed Article 12. A true and correct copy of the proposed
Article 12 of the Corporation's amended Articles of Incorporation and the
resolutions approved and adopted by the Board of Directors and the proposal to
the shareholders are set forth below:
NOW, THEREFORE, BE IT RESOLVED, that in accordance with Sections 1911,
1912, 1914, 1915 and 1916 of the Business Corporation Law of 1988, as amended,
the Board of Directors hereby approves and adopts the following proposed
amendment to the Corporation's Articles of Incorporation, as amended, and hereby
directs that the following proposed amendment to the Articles of Incorporation,
as amended, of this Corporation be submitted to the shareholders of the
Corporation for their approval and adoption at the 1998 Annual Meeting of
Shareholders of the Corporation to be held on April 28, 1998, at 3:00 p.m.,
prevailing time, at Pittsburgh, Pennsylvania, to wit:
A new Article, Article 12, be added to the Articles of Incorporation,
as amended, of the Corporation and state, in full and in its entirety,
Article 12 as follows:
11
<PAGE> 14
12. No merger, consolidation, liquidation or dissolution of the
Corporation, nor any action that would result in the sale or other
disposition of all or substantially all of the assets of the Corporation
shall be valid unless first approved by the affirmative vote of:
(a) the holders of at least seventy-five percent (75%) of the
outstanding shares of Common Stock of the Corporation; or
(b) the holders of at least fifty-one percent (51%) of the outstanding
shares of Common Stock of the Corporation, provided that such
transaction has received the prior approval of at least seventy-five
percent (75%) of the members of the Board of Directors;
This Article 12 shall not be amended unless first approved by the
affirmative vote of the holders of at least seventy-five percent (75%)
of the outstanding shares of Common Stock of this Corporation.
The adoption of this provision by the shareholders requires that a
merger, acquisition or other fundamental transaction to be approved by 75%
of the outstanding shares of the Corporation. However, only 51% of the
outstanding shares of the Corporation need approve such a transaction if
the transaction is first approved by 75% of the members of the Board of
Directors. In addition, this Article could not be amended except with the
approval of the holders of 75% of the outstanding shares of the
Corporation. The overall effect of this provision may be to deter a future
offer or other merger or acquisition proposal that a majority of the
shareholders might view to be in their best interests as the offer might
include a premium over the market price of the holding company's common
stock at that time. In addition, these provisions may have the effect of
assisting the holding company's current management in retaining its
position and placing it in a better position to resist changes that the
shareholders may want to make if dissatisfied with the conduct of the
holding company's business. The Board of Directors believes that this
amendment is desirable in order to increase the Corporation's existing
anti-takeover protection, so that any situation that may arise can be
viewed with all of the shareholders' best interests as the objective, and
not a minority of the shareholders.
The Board of Directors proposes that an Article 12 of the amended
Articles of Incorporation of the Corporation, be added to read in full and
in its entirety as set forth above and that the shareholders of the
Corporation approve and adopt the following amendment:
RESOLVED, that the proposed addition of Article 12 of the amended
Articles of Incorporation of the Corporation, as set forth in its entirety
above, be and hereby is approved, adopted, ratified and confirmed.
The affirmative vote of at least a majority of all votes cast by
shareholders entitled to vote thereon is required to approve and adopt this
new Article 12 of the Articles of Incorporation of the Corporation, as
amended.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE PROPOSAL TO
APPROVE AND ADOPT ARTICLE 12 TO PROVIDE THAT FUNDAMENTAL TRANSACTIONS
REQUIRE THE APPROVAL OF 75% OF THE OUTSTANDING SHARES OF THE CORPORATION
UNLESS FIRST APPROVED BY 75% OF THE MEMBERS OF THE BOARD OF DIRECTORS, IN
WHICH CASE THE APPROVAL OF ONLY 51% OF THE OUTSTANDING SHARES IS REQUIRED.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
(Proposal 4)
The Board of Directors has engaged the services of Deloitte & Touche,
L.L.P., Certified Public Accountants, of Pittsburgh, Pennsylvania, as
independent accountants to examine the financial statements for the Corporation
and its subsidiaries for the 1998 fiscal year. Representatives of Deloitte &
Touche, L.L.P., are not expected to be present at the Annual Meeting, but would
be permitted to attend and make a statement if they desired to do so. They are
available to respond to appropriate questions which can be addressed in writing
to Deloitte & Touche, L.L.P., 2500 One PPG Place, Pittsburgh, PA 15222-5401.
On March 24, 1998, the Board of Directors of the Corporation approved a
resolution, based upon the recommendations of the Board of Directors of the Bank
and the Audit Committee of the Board of Directors of the Bank, to engage
Deloitte & Touche, L.L.P., as the Corporation's independent accountants,
replacing
12
<PAGE> 15
Coopers & Lybrand, L.L.P., its prior independent accountants. Coopers &
Lybrand's report on the Corporation's consolidated financial statements for the
prior two years contained no adverse opinion or disclaimer of opinion or
qualification as to uncertainty, audit scope or accounting principles. In
connection with the audits of the two most recent fiscal years and subsequent
interim period prior to dismissal, there were no disagreements with Coopers &
Lybrand on any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements, if not resolved
to the satisfaction of the former accountants, would have caused them to make
reference in connection with their report to the subject matter of the
disagreement. The Corporation acknowledges that disagreements required to be
reported in response to the preceding sentence include both those resolved to
the former accountants' satisfaction and those not resolved to the former
accountant's satisfaction. The Corporation further acknowledges that
disagreements contemplated by this rule are those which occurred at the
decision-making level; i.e., between personnel of the Corporation responsible
for the presentation if its financial statements and personnel of the accounting
firm responsible for rendering its report. There have been no 'reportable
events', within the meaning of Item 304 of Securities and Exchange Commission
Regulation S-K.
On March 18, 1998, the Corporation filed a Current Report on Form 8-K with
the Securities and Exchange Commission (the 'Commission') to notify the
Commission of the Corporation's change in accountants. The Corporation provided
Coopers & Lybrand with a copy of the Form 8-K and requested that they furnish
the Corporation with a letter addressed to the Commission stating whether such
firm agrees with the statements made by the Corporation contained in the Form
8-K and, if not, stating the respects in which the firm disagrees. Coopers &
Lybrand's letter of response indicated no disagreements with the statements
made, as described above. The letter was attached as an exhibit to the
above-referenced Current Report on Form 8-K. Coopers & Lybrand is not expected
to be represented at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR
RATIFICATION OF DELOITTE & TOUCHE, L.L.P., AS INDEPENDENT PUBLIC ACCOUNTANTS FOR
THE YEAR 1998.
CORPORATION PERFORMANCE
The Corporation's Common Stock trades on the NASDAQ National Market tier of
the NASDAQ Stock Market under the symbol: NSDB. The following graph compares the
percentage change in cumulative total shareholder return on the Corporation's
Common Stock during the period from August 5, 1993 (the date on which the
Corporation's Common Stock first traded on the NASDAQ National Market System) to
December 31, 1997, with the cumulative total shareholder return on stocks
included in (a) the NASDAQ composite index and (b) the NASDAQ bank stocks index.
The information presented in the graph assumes that the value of the investment
in the Corporation's Common Stock and each index was $100 on August 5, 1993 and
that all dividends were reinvested.
13
<PAGE> 16
NSD BANCORP, INC.
TOTAL RETURN PERFORMANCE
<TABLE>
<CAPTION>
MEASUREMENT PERIOD NSD NASDAQ- NASDAQ
(FISCAL YEAR COVERED) BANCORP, INC. TOTAL US BANK INDEX
<S> <C> <C> <C>
08/05/93 100.00 100.00 100.00
12/31/93 108.69 108.83 103.11
12/31/94 113.04 106.38 102.73
12/31/95 121.87 150.45 152.99
12/31/96 135.21 185.04 201.99
12/31/97 273.74 227.07 341.24
</TABLE>
PERIOD ENDING
<TABLE>
<CAPTION>
08/05/93 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
NSD Bancorp, Inc. 100.00 108.69 113.04 121.87 135.21 273.74
NASDAQ-Total US 100.00 108.83 106.38 150.45 185.04 227.07
NASDAQ-Bank Index 100.00 103.11 102.73 152.99 201.99 341.24
</TABLE>
OTHER MATTERS
As of the date of this Proxy Statement, management has no knowledge of any
other matters to be presented for consideration at the Annual Meeting other than
those referred to above. If any other matters properly come before the Annual
Meeting, the persons named in the accompanying Proxy intend to vote, to the
extent permitted by law, in accordance with their best judgment.
By Order of the Board of Directors
/s/ GLORIA J. BUSH
Gloria J. Bush
Secretary
Upon request the Corporation will furnish, without charge, a copy of its
Annual Report to the Securities and Exchange Commission on Form 10-K for the
fiscal year ended December 31, 1997, to any record or beneficial owner of its
Common Stock at the close of business on March 17, 1998. All requests must be in
writing, addressed to the Treasurer, NSD Bancorp, Inc., 100 Federal Street,
Pittsburgh, Pennsylvania 15212, and if from a beneficial owner, must contain a
representation that the person making the request was the beneficial owner, as
of March 17, 1998, of Common Stock of the Corporation. The Corporation reserves
the right to charge a reasonable fee for providing a copy of its Annual Report
on Form 10-K to persons other than those referred to above.
14
