Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
CASCADE FINANCIAL CORPORATION
_______________________________________________
(Name of Registrant as Specified in Its Charter)
CASCADE FINANCIAL CORPORATION
_________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $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:
N/A
(2) Aggregate number of securities to which transactions applies:
N/A
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
N/A
(4) Proposed maximum aggregate value of transaction:
N/A
[ ] 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:
N/A
(2) Form, schedule or registration statement no.:
N/A
(3) Filing party:
N/A
(4) Date filed:
N/A
<PAGE> <PAGE>
September 13, 1996
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Cascade Financial Corporation, to be held at the Corporation's main office,
2828 Colby Avenue, Everett, Washington on Saturday, October 26, 1996 at 10:00
a.m.
The attached Notice of Annual Meeting and Proxy Statement describe the
formal business to be transacted at the Meeting. During the Meeting, we will
also report on the operations of the Corporation. Directors and officers of
the Corporation as well as a representative from the Corporation's independent
accounting firm, KPMG Peat Marwick LLP, will be present to respond to
appropriate questions of stockholders.
Detailed information concerning our activities and operating performance
during our fiscal year ended June 30, 1996 is contained in our Annual Report
to Stockholders which is also enclosed.
To ensure proper representation of your shares at the Meeting, the Board
of Directors requests that you sign, date and return the enclosed proxy card
in the enclosed postage-prepaid envelope as soon as possible, even if you
currently plan to attend the Meeting. If you attend the Meeting, you may vote
in person even if you have previously mailed a proxy card.
We look forward to seeing you at the Meeting.
Sincerely,
/S/FRANK M. MCCORD
Frank M. McCord
Chairman of the Board and
Chief Executive Officer
PAGE
<PAGE>
CASCADE FINANCIAL CORPORATION
2828 COLBY AVENUE
EVERETT, WASHINGTON 98201
(206) 339-5500
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 26, 1996
The Annual Meeting of Stockholders of Cascade Financial Corporation
("Corporation") will be held at the Corporation's main office located at 2828
Colby Avenue, Everett, Washington on Saturday, October 26, 1996 at 10:00 a.m.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. The election of four directors of the Corporation; and
2. Such other matters as may properly come before the Meeting or
any adjournments thereof.
NOTE: The Board of Directors is not aware of any other business to come
before the Meeting.
Any action may be taken on any one of the foregoing proposals at the
Meeting on the date specified above, or on any date or dates to which, by
original or later adjournment, the Meeting may be adjourned. Pursuant to the
Bylaws, the Board of Directors has fixed the close of business on August 23,
1996, as the record date for determination of the stockholders entitled to
vote at the Meeting and any adjournments thereof.
You are requested to fill in and sign the enclosed form of proxy, which
is solicited by the Board of Directors, and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend the Meeting and
vote in person.
BY ORDER OF THE BOARD OF DIRECTORS
/S/RUSSELL E. ROSENDAL
RUSSELL E. ROSENDAL
SECRETARY
Everett, Washington
September 13, 1996
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE YOUR CORPORATION THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES.
PAGE
<PAGE>
PROXY STATEMENT
OF
CASCADE FINANCIAL CORPORATION
2828 COLBY AVENUE
EVERETT, WASHINGTON 98201
(206) 339-5500
ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 26, 1996
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Cascade Financial Corporation
("Corporation") to be used at the Annual Meeting of Stockholders of the
Corporation ("Meeting") which will be held at the Corporation's main office
located at 2828 Colby Avenue, Everett, Washington, on Saturday, October 26,
1996 at 10:00 a.m. The Corporation is the holding company for Cascade Savings
Bank, FSB ("Savings Bank"). The accompanying Notice of Annual Meeting of
Stockholders and this Proxy Statement are being first mailed to stockholders
on or about September 13, 1996.
VOTING AND PROXY PROCEDURE
Stockholders of record as of the close of business on August 23, 1996 are
entitled to one vote for each share of common stock ("Common Stock") of the
Corporation then held. As of September 4, 1996, the Corporation had 2,050,581
shares of Common Stock issued and outstanding. The presence, in person or by
proxy, of at least a majority of the total number of outstanding shares of
Common Stock entitled to vote is necessary to constitute a quorum at the
Annual Meeting. Abstentions will be counted as shares present and entitled to
vote at the Annual Meeting for purposes of determining the existence of a
quorum. Broker non-votes will not be considered shares present for purposes of
determining a quorum.
The Board of Directors solicits proxies so that each stockholder has the
opportunity to vote on the proposals to be considered at the Annual Meeting.
When a proxy card is returned properly signed and dated, the shares
represented thereby will be voted in accordance with the instructions on the
proxy card. Where no instructions are indicated, proxies will be voted FOR
the nominees for directors set forth below. If a stockholder attends the
Annual Meeting, he or she may vote by ballot.
If a stockholder does not return a signed proxy card or does not attend
the Annual Meeting and vote in person, his or her shares will not be voted.
Stockholders who execute proxies retain the right to revoke them at any
time. Proxies may be revoked by written notice delivered in person or mailed
to the Secretary of the Corporation or by filing a later proxy prior to a vote
being taken on a particular proposal at the Annual Meeting. Attendance at the
Annual Meeting will not automatically revoke a proxy, but a stockholder in
attendance may request a ballot and vote in person, thereby revoking a prior
granted proxy.
If a stockholder is a participant in the Cascade Savings Bank, FSB
Employee Stock Ownership Plan (the "ESOP"), the proxy card represents a voting
instruction to the trustees of the ESOP as to the number of shares in the
participant's plan account. Each participant in the ESOP may direct the
trustees as to the manner in which shares of Common Stock allocated to the
participant's plan account are to be voted. Unallocated shares of Common
Stock held by the ESOP and allocated shares for which no voting instructions
are received will be voted by the trustees in the same proportion as shares
for which the trustees have received voting instructions.
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<PAGE>
The four directors to be elected at the Annual Meeting will be elected by
a plurality of the votes cast by stockholders present in person or by proxy
and entitled to vote. Stockholders are not permitted to cumulate their votes
for the election of directors. With respect to the election of directors,
votes may be cast for or withheld from each nominee. Votes that are withheld
and broker non-votes will have no effect on the outcome of the election
because directors will be elected by a plurality of votes cast.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Persons and groups who beneficially own in excess of 5% of the
Corporation's Common Stock are required to file certain reports disclosing
such ownership pursuant to the Securities Exchange Act of 1934, as amended
("Exchange Act"). Based on such reports, the following table sets forth, as
of August 19, 1996, certain information as to those persons who were
beneficial owners of 5% or more of the outstanding shares of Common Stock.
Management knows of no persons other than those set forth below who
beneficially owned more than 5% of the outstanding shares of Common Stock at
August 19, 1996. The following table also sets forth, as of August 19, 1996,
information as to the shares of Common Stock beneficially owned by each
director, by the Chief Executive Officer of the Corporation, by the
Corporation's named executive officers who received salaries and bonuses in
excess of $100,000 during the year ended June 30, 1996 and by all executive
officers and directors of the Corporation as a group.
Percent
Amount and Nature of of Common Stock
Name Beneficial Ownership Outstanding
Beneficial Owners
of 5% or More
Frank M. McCord
Chairman of the Board,
Chief Executive Officer
and Director 135,983(a) 6.6%
Arthur W., Andrew P. and
Craig G. Skotdal
c/o Douglas A. Schafer
Schafer Law Firm
P.O. Box 1134
Tacoma, Washington 98401 101,246(b) 5.0%
Directors
Paull H. Shin 3,438 0.2
Joan M. Earl 1,625 0.1
Dwayne Lane 10,159 0.5
Gary L. Meisner 2,379 0.1
David W. Duce 10,036 0.5
G. Brandt Westover 8,668 0.4
Dennis R. Murphy 12,481 0.6
Ronald E. Thompson 22,796 1.1
(table continued on following page)
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Percent
Amount and Nature of of Common Stock
Name Beneficial Ownership Outstanding
Named Executive Officers
Frank M. McCord* 135,983(c) 6.6%
C. Fredrick Safstrom* 39,080 1.9
Robert G. Disotell* 33,294 1.6
All Executive Officers
and Directors as a
Group (11 persons) 279,939(d)(e) 12.0
_______________
* Also a director of the Corporation and the Savings Bank.
(a) Based on records maintained by the Corporation and information
from a Schedule 13D filed by Mr. McCord on June 14, 1993. Also,
there have been no amended filings received by the Corporation.
According to the Schedule 13D, Mr. McCord exercises shared voting
and investment authority over these shares with his wife.
(b) This information is based on a Schedule 13D filed with the OTS on
May 13, 1994, adjusted for stock splits. Also, there have been
no amended filings received by the Corporation.
(c) Chief Executive Officer of the Corporation and the Savings Bank.
(d) Includes certain shares owned by spouses, or as custodian or
trustee for minor children, over which shares all officers and
directors as a group effectively exercise sole or shared
voting and investment power, unless otherwise indicated.
(e) Does not include 71,202 shares owned by the Corporation's ESOP
over which shares the ESOP Committee, consisting of certain
directors and officers of the Corporation, exercises partial
investment power, or 28,700 shares owned by the Corporation's
401(k) plan.
PROPOSAL I -- ELECTION OF DIRECTORS
The Corporation's Board of Directors currently is composed of eleven
members. The Corporation's Bylaws provide that directors are to be elected
for terms of three years, approximately one-third of whom are elected
annually.
The Nominating Committee has nominated for election as directors Ms. Joan
M. Earl and Messrs. Frank M. McCord, C. Fredrick Safstrom and David W. Duce
each for a three year term. All nominees currently serve as members of the
Boards of Directors of the Corporation and the Savings Bank.
If any nominee is unable to serve, the shares represented by all valid
proxies will be voted for the election of such substitute as the Board of
Directors may recommend or the Board of Directors may amend the Bylaws and
reduce the size of the Board. At this time, the Board knows of no reason why
any nominee might be unable to serve.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" ALL OF THE
NOMINEES NAMED BELOW FOR DIRECTORS OF THE CORPORATION.
The following table sets forth as to each nominee and director continuing
in office, his or her name, age, principal occupation(s) during the past five
years and the year he or she first became a director.
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<PAGE>
Year First
Positions Elected or
Held With Appointed Term to
Name Age(a) the Corporation Director (b) Expire
BOARD NOMINEES
Joan M. Earl 42 Director 1995 1999(c)
Frank M. McCord 66 Chairman of the Board, 1986 1999(c)
Chief Executive Officer
and Director
C. Fredrick
Safstrom 42 President, Chief Operating 1990 1999(c)
Officer and Director
David W. Duce 37 Vice Chairman of the 1991 1999(c)
Board
DIRECTORS CONTINUING IN OFFICE
Dwayne Lane 61 Director 1995 1997
G. Brandt Westover 36 Director 1986 1997
Dennis R. Murphy 54 Director 1991 1997
Ronald E. Thompson 47 Director 1991 1997
Robert G. Disotell 41 Executive Vice President 1990 1998
and Director
Paull H. Shin 60 Director 1995 1998
Gary L. Meisner 61 Director 1995 1998
____________
(a) At August 19, 1996.
(b) Includes prior service on the Board of Directors of the Savings
Bank.
(c) Assuming the individuals are reelected at the Meeting.
The principal occupation of each director of the Corporation is set forth
below. All of the directors have held their present position for at least
five years unless otherwise stated.
JOAN M. EARL is the Deputy County Executive for Snohomish County.
Formerly, Ms. Earl was the City Manager of Mill Creek, Washington and the
Budget Director and Fiscal Officer for Kitsap County, Washington. Ms. Earl is
active in community affairs and is a board member of the Camp Fire Boys and
Girls of Snohomish County and Snohomish County United Way.
FRANK M. MCCORD, C.P.A. became Chairman of the Board of Directors,
President and Chief Executive Officer of the Savings Bank in 1990. Mr. McCord
was the Managing Partner of KPMG Peat Marwick LLP, Seattle, Washington office
until his retirement in 1986. In addition to his responsibilities to the
Corporation, Mr. McCord is a director of the Everett Area Chamber of Commerce
and serves as its Chairman, the Everett Performing Arts Association, and
Housing Hope, a local housing agency. Mr. McCord also serves as a Director of
Horizon/CMS Healthcare Corporation, a publicly-held company listed on the New
York Stock Exchange, which is one of the largest diversified healthcare
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<PAGE>
providers in the United States. Mr. McCord has previously served as President
of the Evergreen Area Council of Boy Scouts of America, Treasurer of the
United Way of King County, Trustee of Seattle University, a Fellow of Seattle
Pacific University, Treasurer of the Washington Society of Certified Public
Accountants, and a Director of the Seattle Chamber of Commerce.
C. FREDRICK SAFSTROM joined Cascade in 1976 and has managed several areas
including branch management, secondary marketing, loan underwriting and
regulatory compliance. In June 1990 Mr. Safstrom was elected to the Board of
Directors and in December 1991 was elected President. Mr. Safstrom is a
trustee and the treasurer of the Snohomish County YMCA, a board member of the
Snohomish County Investment Plan Corporation, a director of the Everett Public
Schools Foundation, a member of the Everett Rotary, and is active in various
housing related boards and committees.
DAVID W. DUCE is a practicing attorney with Duce, Bastian, Peterson and
Zielke in Everett, Washington. He has also served as a volunteer attorney at
Snohomish County Legal Services, a Bishop in the Church of Jesus Christ Latter
Day Saints, and a former member of Senator Henry M. Jackson's
Washington, D.C. staff. Mr. Duce has been a director since January 1991 and
was elected Vice Chairman in 1995.
DWAYNE LANE is the owner of three automobile dealerships in Everett and
Arlington, Washington. Mr. Lane, an Everett native, is active in community
affairs. Mr. Lane served 12 years as an Everett Port Commissioner and was a
board member for Olympic Bank and Providence Hospital.
G. BRANDT WESTOVER is a Vice President with PaineWebber Inc. in Bellevue,
Washington. He was an account executive with the investment firm of Smith
Barney Harris Upham, Seattle, Washington from 1987 to 1992. Mr. Westover has
been a director since January 1986.
DENNIS R. MURPHY is the Dean and a Professor of Economics at Western
Washington University, Bellingham, Washington. He has also served on the
Citizens Advisory Board of Bellingham Public Schools, Community
Problem-Solving Partnership, United Way of Whatcom County, Board of Directors
Whatcom Chamber of Commerce and Industry and Bellingham Rotary. He is a
resident of Bellingham, Washington. Dr. Murphy has been a director since
January 1991.
RONALD E. THOMPSON is the President of WRE Commercial and Property
Management, Inc., Everett, Washington, a real estate sales and property
management company. He is a past president of the Snohomish County-Camano
Association of Realtors, a current State director of the Washington
Association of Realtors, member of the Everett Rotary Club, and serves on the
Board of Directors for the Mt. Baker Council Boy Scouts of America. Mr.
Thompson resides in Everett and has been a director of the Savings Bank since
January 1991.
ROBERT G. DISOTELL has been employed by Cascade for approximately 17
years and currently serves as a Director and an Executive Vice President. As
Chief Lending Officer, he is responsible for loan production. Mr. Disotell is
a resident of Arlington, Washington.
PAULL H. SHIN is a Professor of History at Shoreline Community College,
Seattle, Washington. Dr. Shin is Chairman of Transpacific Telecommunications,
Inc. and a board member of the Snohomish County United Way, YMCA and KIRO
Inc., a local broadcasting company. Dr. Shin is a resident of Mukilteo,
Washington.
GARY L. MEISNER is President of the Small Business Center, Inc., an
independent insurance agency in Everett, Washington. Prior to this position,
Mr. Meisner spent 14 years in commercial and consumer banking. Mr. Meisner is
a graduate of Wayne State College and the Pacific Coast Banking School. Mr.
Meisner is active in community affairs.
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Meetings and Committees of the Board of Directors
The Boards of Directors of the Corporation and the Savings Bank conduct
their business through meetings of the Boards and through their committees.
During the fiscal year ended June 30, 1996, the Board of Directors of the
Corporation and the Savings Bank held seven meetings. No director of the
Corporation or the Savings Bank attended fewer than 75% of the total meetings
of the Board of Directors and committee meetings on which such Board member
served during this period.
The Board of Directors of the Corporation and the Savings Bank has an
Audit and Finance Committee consisting of Messrs. Murphy (Chairman), Earl and
Meisner. The purpose of the Committee is to provide direction and oversight
to the Internal Auditor and bears responsibility for the audit function and
reviews the examination of the Savings Bank by federal and state regulatory
authorities and the audit by the independent auditing firm. The Audit and
Finance Committee meets at least quarterly and met seven times during the 1996
fiscal year.
The Board of Directors has a Compensation and Nominations Committee
consisting of Messrs. Duce (Chairman), Lane and Shin, all of whom are outside
directors. This committee is responsible for reviewing the compensation
policies of the Corporation and the Savings Bank, approving compensation of
executive officers, and recommending the granting of stock options. The
committee met three times during the 1996 fiscal year.
In connection with the Annual Meeting and selection of the management
nominees for election as directors, Article II, Section 14 of the
Corporation's Bylaws provides that the Board of Directors of the Corporation
shall act as a nominating committee for selecting the management nominees for
election as directors. Such section of the Bylaws also provides as follows:
"... no nominations for directors except those made by the nominating
committee shall be voted upon at the annual meeting unless other nominations
by stockholders are made in writing and delivered to the secretary of the
Corporation in accordance with the provisions of the Corporation's Certificate
of Incorporation." Article II, Section 15 further provides that any new
business to be taken up at the annual meeting shall be stated in writing and
filed with the secretary of the Corporation in accordance with the provisions
of the Corporation's Certificate of Incorporation. Article XI of the
Certificate of Incorporation provides that written notice of a stockholder's
intent to make a nomination or present new business at the meeting
("stockholder notice") must be given not less than 30 days nor more than 60
days prior to any such meeting; provided, however, that if less than 31 days'
notice of the meeting is given to stockholders by the Corporation, a
stockholder notice shall be delivered or mailed, as prescribed, to the
Secretary of the Corporation not later than the close of the tenth day
following the day on which notice of the meeting was mailed to stockholders.
If properly made, such nominations shall be considered by stockholders at such
meeting. The Board of Directors of the Corporation held one meeting in its
capacity as the nominating committee during fiscal 1996, in order to nominate
the individuals for election at the Meeting.
Directors' Compensation
Outside members of the Board of Directors receive a $7,200 retainer per
year. Committee meeting fees are $200 ($300 for committee chairman). Total
fees paid to directors during the year ended June 30, 1996 were $58,000.
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Executive Compensation
Summary Compensation Table. The following information is furnished for
the Chief Executive Officer of the Corporation for the year ended June 30,
1996 and those executive officers of the Corporation who received salary and
bonus in excess of $100,000 during the year ended June 30, 1996.
SUMMARY COMPENSATION TABLE
Long-term
Compen-
sation
Annual Compensation Awards
Name and Other Annual Stock All Other
Principle Salary Bonus Compensation Options Compensation
Position Year ($)(1) ($) ($)(2) (#) ($)
Frank M. McCord 1996 $103,200 $39,088 -- -- $6,523
Chief Executive 1995 103,200 58,662 -- -- 6,277(3)
Officer 1994 96,000 39,148 -- -- 5,226
C. Fredrick
Safstrom 1996 $ 77,440 $34,538 -- -- $6,545
1995 72,192 50,057 -- -- 10,183(3)
1994 60,000 31,458 -- -- 10,873
Robert G.
Disotell 1996 $ 77,190 $30,080 -- -- $4,941
1995 72,192 44,476 -- -- 9,582(3)
1994 60,000 27,404 -- -- 6,812
_____________
(1) Includes salary and directors' fees.
(2) Does not include perquisites which did not exceed $50,000 or 10% of
salary and bonus.
(3) All Other Compensation for fiscal year 1996 includes the following:
401(k) Plan: Mr. McCord: $2,023; Mr. Safstrom: $1,682; Mr. Disotell:
$1,347. Employee Stock Ownership Plan: Mr. McCord: $4,500; Mr.
Safstrom: $3,500; Mr. Disotell: $3,500. Other: Mr. McCord: $0; Mr.
Safstrom: $1,363; Mr. Disotell: $94.
Option Exercise/Value Table. The following table sets forth all option
values for the fiscal year ended June 30, 1996 for Messrs. McCord, Safstrom
and Disotell.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
Number of Value of
Unexercised Unexercised
Shares Options at In-the-Money
Acquired FY-End(#) Options at
on Value FY-End ($)(1)
Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
Frank M.
McCord -- -- 25,655/17,104 $384,825/$256,560
C. Frederick
Safstrom -- -- 21,240/14,160 $318,600/$212,400
Robert G.
Disotell -- -- 19,775/13,184 $296,625/$197,760
______________
(1) The value of unexercised in-the-money options is calculated using a fair
market value of $15.00 as of June 30, 1996, based on the last known
trade on or before such date. Options have been adjusted for stock
splits.
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Notwithstanding anything to the contrary set forth in any of the
Corporation's previous filings under the Securities Act of 1933, as amended,
or the Exchange Act that might incorporate future filings, including this
Proxy Statement, in whole or in part, the following report and Performance
Graph shall not be incorporated by reference into any such filings.
Report of the Compensation Committee
Under rules established by the SEC, the Corporation is required to
provide certain data and information in regard to the compensation and
benefits provided to the Corporation's Chief Executive Officer and other
executive officers of the Savings Bank and the Corporation. The Compensation
and Nominations Committee's duties are to establish and administer policies
that govern executive compensation for the Corporation. The Committee
evaluates the individual executive performance of the Chief Executive Officer,
Chief Operating Officer and President, Chief Financial Officer and Chief
Lending Officer of the Corporation regarding individual compensation levels
and reviews compensation policies. The Committee receives input from the
Chief Executive Officer on the other three executive officers' performance and
has final authority to set individual compensation levels.
The executive compensation policies of the Corporation are designed to
reflect the attainment of short and long-term financial performance goals and
to enhance the ability of the Corporation to attract and retain qualified
executive officers. The Committee considers a variety of subjective and
objective factors in determining the compensation package for individual
executives including the performance of the Corporation overall, the
responsibilities assigned to each executive and the performance of each
executive of assigned responsibilities as measured by the progress of the
Corporation during the year.
Base Salary. The Corporation's compensation plan involves a combination
of salary and cash bonuses in regard to short-term performance. Salary levels
are designed to be competitive with the banking industry based on a peer group
analysis of Washington state financial institutions. Specifically, the
Committee reviews the Washington Savings League's compensation report of
senior banking executives. Given the Corporation's performance and size, the
Committee believes the base salaries of executive officers were significantly
below the average and recommended a 15% increase beginning in July 1996.
Bonus program. An incentive bonus plan is in effect for the executive
officers of the Corporation which is designed to provide compensation for
performance. The plan provides for a bonus pool, of no greater than $300,000,
to be shared by the four executive officers noted above based on net earnings
of the Corporation that are above predetermined targets. There were no
bonuses paid or accrued to any executive officer for the year ended June 30,
1995. The actual bonus pool for the year ended June 30, 1996 was $195,000 and
will be paid in quarterly installments beginning in October 1996. Percentages
allocated among the four executive officers are based on the Committee's
evaluation of individual performance.
Compensation of the Chief Executive Officer. For the year ended June 30,
1996, the base salary of Frank M. McCord, Chairman and Chief Executive Officer
of the Savings Bank and the Corporation was $103,200. In addition, he
received $39,088 in deferred bonuses for the fiscal year ended June 30, 1994,
and was also credited with $6,523 in compensation relating to his 401(k) and
ESOP accounts. Mr. McCord's performance bonus reflected the attainment of
specific performance criteria for the 1994 fiscal year established by the
Board of Directors. The Committee believes that Mr. McCord's compensation is
appropriate based on the Corporation's overall performance.
Compensation and Nominations Committee
David W. Duce (Chairman)
Dwayne Lane
Paull H. Shin
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Compensation Committee Interlocks and Insider Participation
The Compensation and Nominations Committee was composed of Messrs. Duce,
Lane and Shin during the year ended June 30, 1996. No executive officer of
the Corporation has served as a member of the compensation committee of
another entity, one of whose executive officers served on the Compensation and
Nominations Committee of the Corporation. No executive officer of the
Corporation has served as a director of another entity, one of whose executive
officers served on the Compensation and Nominations Committee. No executive
officer of the Corporation has served as a member of the compensation
committee of another entity, one of whose executive officers served as a
director of the Corporation.
Performance Graph
The following graph compares the Corporation's cumulative stockholder
return on its Common Stock with the return on the National Association of
Securities Dealers Automated Quotation ("Nasdaq") (U.S. companies) Index and a
peer group of the Nasdaq's Financial Index. Total return assumes the
reinvestment of all dividends.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
CORPORATION, NASDAQ (U.S. COMPANIES) AND NASDAQ FINANCIAL STOCKS
Period Ending
09/30/92 09/30/93 09/30/94 09/30/95 09/30/96
________________________________________________
Corporation 100.00 $286.46 $691.73 $1,144.41 $1,614.29
Nasdaq (Fin.) Index 100.00 137.10 144.50 182.85 203.63
Nasdaq (U.S.) Index 100.00 130.98 132.05 182.38 190.55
The graph assumes $100 was invested on September 15, 1992 when the
Corporation first issued stock to the public. Trading of the stock began
September 15, 1992.
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COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Corporation's executive
officers and directors, and persons who own more than 10% of any registered
class of the Corporation's equity securities, to file reports of ownership and
changes in ownership with the Securities and Exchange Commission. Executive
officers, directors and greater than 10% shareholders are required by
regulation to furnish the Corporation with copies of all Section 16(a) forms
they file.
Based solely on its review of the copies of such forms it has received
and written representations provided to the Corporation by the above
referenced persons, the Corporation believes that during the fiscal year ended
June 30, 1996 all filing requirements applicable to its reporting officers,
directors and greater than 10% shareholders were properly and timely complied
with except for one Form 4, Statement of Change in Beneficial Ownership of
Securities, for Director Dwayne Lane. Mr. Lane's Form 4 for transactions
during the month of January 1996 was filed on March 21, 1996, rather than by
February 10, 1996 as required.
TRANSACTIONS WITH MANAGEMENT
Effective with passage of the Financial Institutions Reform, Recovery,
and Enforcement Act of 1989 ("FIRREA"), executive officers and directors of an
association are prohibited from receiving any loan or extension of credit at
other than market rates and terms. Cascade adopted a policy to discontinue
the granting of preferred loans to directors and officers in April 1990. The
terms of existing loans has not changed, as allowed by the legislation.
Loans extended to the Corporation's officers and directors are made in
the ordinary course of business and were made on substantially the same terms,
including interest rates and collateral, as those of comparable transactions
with other persons and do not involve more than the normal risk of
collectibility or contain other preferential features. At June 30, 1996,
there were three loans outstanding to the Corporation's executive officers and
directors, which in the aggregate totalled $99,238.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Corporation's proxy
materials for the 1996 annual meeting of stockholders, any stockholder
proposal to take action at such meeting must be received at the Corporation's
executive offices at 2828 Colby Avenue, Everett, Washington 98201 no later
than May 17, 1997. Any such proposal shall be subject to the requirements of
the proxy rules adopted under the Exchange Act.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matters should properly come before the Meeting, it is
intended that proxies in the accompanying form will be voted in respect
thereof in accordance with the judgment of the person or persons voting the
proxies, including matters relating to the conduct of the Meeting.
The cost of solicitation of proxies will be borne by the Corporation.
The Corporation will reimburse brokerage firms and other custodians, nominees
and fiduciaries for reasonable expenses incurred by them in sending proxy
material to the beneficial owners of the Corporation's Common Stock. In
addition to solicitations by mail, directors, officers and regular employees
of the Corporation and Savings Bank may solicit proxies personally, by
telegraph or telephone without additional compensation. The Corporation may
use the services of a proxy solicitor.
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FINANCIAL STATEMENTS
The Corporation's Annual Report to Stockholders, including financial
statements, has been mailed to all stockholders of record as of the close of
business on August 23, 1996. Any stockholder who has not received a copy of
such Annual Report may obtain a copy by writing to the Secretary of the
Corporation. Such Annual Report is not to be treated as part of the proxy
solicitation material or as having been incorporated herein by reference.
BY ORDER OF THE BOARD OF DIRECTORS
/S/RUSSELL E. ROSENDAL
RUSSELL E. ROSENDAL
SECRETARY
Everett, Washington
September 13, 1996
FORM 10-K
A COPY OF THE FORM 10-K AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
WILL BE FURNISHED WITHOUT CHARGE TO STOCKHOLDERS AS OF THE RECORD DATE UPON
WRITTEN REQUEST TO RUSSELL E. ROSENDAL, SECRETARY, CASCADE FINANCIAL
CORPORATION, 2828 COLBY AVENUE, EVERETT, WASHINGTON 98201.
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REVOCABLE PROXY
CASCADE FINANCIAL CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 26, 1996
The undersigned hereby appoints the official proxy committee consisting
of all of the members of the Board of Directors of Cascade Financial
Corporation ("Corporation"), Everett, Washington, with full powers of
substitution, to act as attorneys and proxies for the undersigned, to vote all
shares of Common Stock of the Corporation which the undersigned is entitled to
vote at the Annual Meeting of Stockholders, to be held at the Corporation's
main office located at 2828 Colby Avenue, Everett, Washington, on Saturday,
October 26, 1996, at 10:00 a.m., and at any and all adjournments thereof, as
follows:
FOR AGAINST ABSTAIN
I. The election as directors of
all nominees listed below (except
as marked to the contrary below).
Joan M. Earl
Frank M. McCord
C. Fredrick Safstrom
David W. Duce
INSTRUCTION: To withhold your vote for any individual
nominee, write the nominee's name on the line below.
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The Board of Directors recommends a vote "FOR" the listed proposition.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED
THIS PROXY WILL BE VOTED "FOR" THE PROPOSAL STATED. IF ANY OTHER BUSINESS IS
PRESENTED AT THE MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS
PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS
KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING. THIS PROXY ALSO
CONFERS DISCRETIONARY AUTHORITY ON THE BOARD OF DIRECTORS TO VOTE WITH RESPECT
TO THE ELECTION OF ANY PERSON AS DIRECTOR WHERE THE NOMINEE IS UNABLE TO SERVE
OR FOR GOOD CAUSE WILL NOT SERVE, AND MATTERS INCIDENT TO THE CONDUCT OF THE
ANNUAL MEETING.
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THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and elect to vote at the Annual Meeting
or at any adjournment thereof and after notification to the Secretary of the
Corporation at the Annual Meeting of the stockholder's decision to terminate
this proxy, then the power of said attorneys and proxies shall be deemed
terminated and of no further force and effect.
The undersigned acknowledges receipt from the Corporation prior to the
execution of this Proxy, of the Notice of the Annual Meeting of Stockholders,
a Proxy Statement dated September 13, 1996 and the 1996 Annual Report to
Stockholders.
Dated: , 1996
__________________________ ___________________________
PRINT NAME OF STOCKHOLDER PRINT NAME OF STOCKHOLDER
_________________________ ___________________________
SIGNATURE OF STOCKHOLDER SIGNATURE OF STOCKHOLDER
Please sign exactly as your name appears on the envelope in which this card
was mailed. When signing as attorney, executor, administrator, trustee or
guardian, please give your full title. If a corporation, please sign in full
corporate name by the president or other authorized officer. If a
partnership, please sign in partnership name by authorized person. For joint
accounts, only one signature is required.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
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