<PAGE>
<PAGE>
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. ___ )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
COMMUNITY FINANCIAL CORP.
- ----------------------------------------------------------------
(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):
[ X ] No fee required.
[ ] Fee computed on table below per Exchange Act
Rules 14a-6(i)(1) 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>
<PAGE>
COMMUNITY FINANCIAL CORP.
240 E. CHESTNUT STREET
OLNEY, ILLINOIS 62450-2295
(618) 395-8676
ANNUAL MEETING
April 27, 2000
Dear Fellow Stockholder:
You are cordially invited to attend the Annual Meeting of
Stockholders (the "Annual Meeting") of Community Financial Corp.
(the "Company") which will be held on Thursday, April 27, 2000,
at The Holiday Motel located at 1300 S. West Street, Olney,
Illinois at 11:00 a.m., local time. Your Board of Directors and
management look forward to greeting personally those
stockholders able to attend.
The attached Notice of Annual Meeting and Proxy Statement
describe the formal business to be transacted at the Annual
Meeting. During the meeting, we will also report on the
operations of your Company's wholly owned bank subsidiaries.
Directors and officers of the Company will be present to respond
to any questions the stockholders may have.
CAUTION
A dissident shareholder, Mr. Barrett Rochman, has
announced his intention to commence a proxy contest in
opposition to your Board of Directors. Mr. Rochman will be
seeking your support to, among other things, elect himself and
another dissident in place of the two highly qualified and
experienced nominees proposed for election by your board. WE
URGE YOU TO REJECT MR. ROCHMAN'S SOLICITATION -- DO NOT SIGN ANY
PROXY CARD HE MAY SEND YOU. PLEASE BE ASSURED THAT YOUR BOARD
OF DIRECTORS WILL CONTINUE TO ACT IN THE BEST INTEREST OF ALL
COMMUNITY FINANCIAL STOCKHOLDERS.
______________________
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES
YOU OWN. ON BEHALF OF YOUR BOARD OF DIRECTORS, WE URGE YOU TO
SIGN, DATE AND MAIL THE ENCLOSED WHITE PROXY CARD AS SOON AS
POSSIBLE EVEN IF YOU CURRENTLY PLAN TO ATTEND THE ANNUAL
MEETING. This will not prevent you from voting in person but
will assure that your vote is counted if you are unable to
attend the meeting.
On behalf of the Board of Directors and all the employees
of your Company, thank you for your continued interest and
support.
Sincerely,
/s/ Wayne H. Benson
Wayne H. Benson
President and Chief Executive Officer
<PAGE>
<PAGE>
________________________________________________________________
COMMUNITY FINANCIAL CORP.
240 E. CHESTNUT STREET
OLNEY, ILLINOIS 62450-2295
________________________________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on April 27, 2000
________________________________________________________________
NOTICE IS HEREBY GIVEN that the Annual Meeting of
Stockholders (the "Annual Meeting") of Community Financial Corp.
(the "Company") will be held at The Holiday Motel located at
1300 S. West Street, Olney, Illinois on Thursday, April 27,
2000, at 11:00 a.m., local time.
A Proxy Statement and White Proxy Card for the Annual
Meeting are enclosed.
The Annual Meeting is for the purpose of considering and
acting upon the following matters:
1. The election of two directors of the Company;
2. A stockholder proposal submitted by Mr.
Barrett Rochman; and
3. Such other business as may properly come
before the Annual Meeting or any adjournment
thereof.
The Board of Directors is not aware of any other business
to come before the Annual Meeting.
Any action may be taken on any one of the foregoing pro-
posals at the Annual Meeting on the date specified above or on
any date or dates to which, by original or later adjournment,
the Annual Meeting may be adjourned. Stockholders of record at
the close of business on March 10, 2000, are the stockholders
entitled to notice of and to vote at the Annual Meeting and any
adjournment thereof.
You are requested to sign and date the enclosed White
Proxy Card 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 and vote at the Annual Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Steven Walser
Steven Walser
Secretary
Olney, Illinois
March 14, 2000
IMPORTANT
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU
OWN. ACCORDINGLY, PLEASE SIGN, DATE AND MAIL YOUR WHITE PROXY
CARD AT YOUR EARLIEST CONVENIENCE. A SELF-ADDRESSED ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES. STOCKHOLDERS WITH QUESTIONS OR REQUIRING
ASSISTANCE MAY CALL D.F. KING & CO., INC., WHICH IS ASSISTING
US, TOLL-FREE AT (888) 242-8155.
<PAGE>
<PAGE>
________________________________________________________________
PROXY STATEMENT
OF
COMMUNITY FINANCIAL CORP.
240 E. CHESTNUT STREET
OLNEY, ILLINOIS 62450-2295
________________________________________________________________
ANNUAL MEETING OF STOCKHOLDERS
APRIL 27, 2000
________________________________________________________________
________________________________________________________________
GENERAL
________________________________________________________________
This Proxy Statement and the enclosed White Proxy Card are
furnished to stockholders of Community Financial Corp. (the
"Company") in connection with the solicitation by the Board of
Directors of the Company of proxies to be used at the Annual
Meeting of Stockholders (the "Annual Meeting"), which will be
held at The Holiday Motel located at 1300 S. West Street, Olney,
Illinois on Thursday, April 27, 2000, at 11:00 a.m., local time,
and at any adjournment thereof. The accompanying Notice of
Annual Meeting and White Proxy Card and this Proxy Statement are
being first mailed to stockholders on or about March 14, 2000.
________________________________________________________________
VOTING AND REVOCABILITY OF PROXIES
________________________________________________________________
The securities entitled to vote at the Annual Meeting
consist of the Company's common stock, par value $.01 per share
(the "Common Stock"). Stockholders of record as of the close of
business on March 10, 2000 (the "Record Date") are entitled to
one vote for each share of Common Stock then held. As of the
Record Date, there were 2,213,645 shares of Common Stock issued
and outstanding. The presence, in person or by proxy, of at
least one-third of the total number of shares of Common Stock
outstanding and entitled to vote will be necessary to constitute
a quorum at the Annual Meeting.
Regardless of the number of shares of the Common Stock
owned, it is important that stockholders be represented by proxy
or present in person at the Annual Meeting. Stockholders are
requested to vote by completing the enclosed white proxy card
and returning it signed and dated in the enclosed postage-paid
envelope.
Proxies solicited by the Board of Directors of the Company
which are properly executed and returned to the Company will be
voted at the Annual Meeting, and any adjournments or
postponements thereof, in accordance with the directions given
thereon. Executed proxies on which no directions are indicated
will be voted "FOR" the election of the Company's nominees named
herein and "AGAINST" Proposal No. II of Mr. Rochman. If any
other matters are properly brought before the Annual Meeting,
the proxies solicited by the Board of Directors will be voted on
such matters as determined by a majority of the Board. Other
than the election of directors, the Board of Directors is not
currently aware of any other matters to be brought before the
Annual Meeting. Proxies marked as abstentions will not be
counted as votes cast. In addition, shares held in street name
which have been designated by brokers on proxy cards as not
voted will not be counted as votes cast. Proxies marked as
abstentions or as broker nonvotes, however, will be treated as
shares present for purposes of determining whether a quorum is
present.
Execution of a White Proxy Card will not affect your right
to attend the Annual Meeting and to vote in person. A
stockholder executing a proxy may revoke such proxy at any time
before it is voted by (i) filing a written notice of revocation
with the Secretary of the Company at the address provided above,
(ii) filing a duly executed proxy bearing a later date, or (iii)
attending and voting in person at the Annual Meeting.
Attendance at the Annual Meeting without voting thereat will not
revoke a proxy previously executed and duly submitted by you.
<PAGE>
________________________________________________________________
RECENT DEVELOPMENTS
________________________________________________________________
On March 1, 2000, Barrett R. Rochman filed definitive
proxy materials with the Securities and Exchange Commission for
the solicitation of proxies for the election of himself and
Michael B. Nadler to the Company's Board of Directors. Such
solicitation would be in opposition to the solicitation by the
Board of Directors for the election of C. Richard King and
Steven L. Schonert as directors of the Company pursuant to this
Proxy Statement, and the Company urges all stockholders not to
sign any proxy card to you by Mr. Rochman, not even as a vote of
protest.
In addition, in his definitive proxy materials, Mr.
Rochman indicated his intent to solicit proxies in favor of a
stockholder proposal. For further information regarding this
proposal, see "Proposal II -- Stockholder Proposal."
STOCKHOLDERS WISHING TO VOTE ON THIS PROPOSAL WILL BE
AFFORDED AN OPPORTUNITY TO DO SO ON THE ENCLOSED WHITE PROXY
CARD. THE COMPANY OPPOSES THIS PROPOSAL AND RECOMMENDS THAT
STOCKHOLDERS VOTE AGAINST THIS PROPOSAL.
________________________________________________________________
SECURITY OWNERSHIP
________________________________________________________________
Persons and groups beneficially owning more than 5% of the
Common Stock are required to file certain reports with respect
to such ownership pursuant to the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The following table sets
forth information regarding the shares of Common Stock
beneficially owned as of the Record Date by persons who
beneficially own more than 5% of the Common Stock, each of the
Company's directors, each executive officer of the Company named
in the Summary Compensation Table set forth under "Proposal I --
Election of Directors -- Executive Compensation -- Summary
Compensation Table" and all of the Company's directors and
executive officers as a group.
<TABLE>
<CAPTION>
Shares of Common Stock
Beneficially Owned Percent
at Record Date (1) of Class
---------------------- --------
<S> <C> <C>
Persons Owning Greater than 5%:
- ------------------------------
Community Financial Corp. 195,046 (2) 8.8%
Employee Stock Ownership Plan ("ESOP")
240 E. Chestnut Street
Olney, Illinois 62450-2295
Wellington Management Company, LLP 155,500 7.0
75 State Street
Boston, Massachusetts 02109
First Financial Fund, Inc. 155,500 7.0
Gateway Center Three
100 Mulberry Street, 9th Floor
Newark, New Jersey 07102-7503
(continued on following page)
2
<PAGE>
<PAGE>
Shares of Common Stock
Beneficially Owned Percent
at Record Date (1) of Class
---------------------- --------
<S> <C> <C>
Persons Owning Greater than 5%(continued):
- ------------------------------
Barrett R. Rochman 129,340 5.8
1345 East Park Street
Carbondale, Illinois 62901
Directors:
Michael F. Bauman 19,925 (3) .8
Wayne H. Benson 75,597 (4) 3.2
Roger A. Charleston 40,325 (5) 1.7
Gary L. Graham 7,406 .3
Roger L. Haberer 8,106 (6) .3
Brad A. Jones 23,785 1.0
Shirley B. Kessler 78,284 (7) 3.3
C. Richard King 17,885 .8
Nominee for Director:
- --------------------
Steven L. Schonert 1,000 *
Executive Officer:
- -----------------
Douglas W. Tompson 51,761 (8) 2.2
Chief Financial Officer
All directors, nominees for directors 324,074 13.6
and executive officers of the Company
as a group (10 persons)
</TABLE>
_________
(1) In accordance with Rule 13d-3 under the Exchange Act, a
person is deemed to be the beneficial owner, for purposes of
this table, of any shares of Common Stock if he or she has
shares with voting or investment power with respect to such
Common Stock or has a right to acquire beneficial ownership
at any time within 60 days from the Record Date. As used
herein, "voting power" is the power to vote or direct the
voting of shares, and "investment power" is the power to
dispose or direct the disposition of shares. Except as
otherwise noted, ownership is direct, and the named
individuals and group exercise sole voting and investment
power over the shares of the Common Stock. Amounts shown
include 9,918, 38,617, 9,918, 5,290, 5,290, 9,918, 43,378,
9,918, 0, 26,450 and 158,697 shares which may be acquired by
Directors Bauman, Benson, Charleston, Graham, Haberer,
Jones, Kessler and King, Director Nominee Schonert and Mr.
Thompson and by all directors, nominees for director and
executive officers of the Company as a group, respectively,
upon the exercise of options exercisable within 60 days of
the Record Date. Does not include shares with respect to
which Directors Bauman, Charleston and Jones have voting
power by virtue of their positions as trustees of the trusts
holding 195,046 shares under the Company's ESOP and 2,116
shares under the Company's Management Recognition Plan
("MRP"). The shares held by the MRP trust are voted in the
same proportion as the ESOP trustees vote the shares held in
the ESOP trust.
(2) These shares are currently held in a suspense account for
future allocation and distribution among participants as the
loan used to purchase the shares is repaid. The ESOP
trustees vote all allocated shares in accordance with the
instructions of the participating employees. Unallocated
shares and allocated shares for which no instructions have
been received are voted by the trustees in the manner
directed by the Company's Board of Directors, and in the
absence of such direction from the Company's Board of
Directors, the ESOP trustees would have sole discretion as
to the voting of such shares. As of the Record Date,
108,841 shares had been allocated.
(3) Includes 290 shares owned by Mr. Bauman's spouse.
(4) Includes 3,350 shares owned by Mr. Benson's spouse, 9,402
shares allocated to Mr. Benson's account under the ESOP and
2,222 shares held in the Company's 401(k) Thrift Plan.
3
<PAGE>
<PAGE>
(5) Includes 3,230 shares owned by Mr. Charleston's spouse.
(6) Includes 500 shares owned by Mr. Haberer's spouse.
(7) Includes 10,398 shares allocated to Ms. Kessler's account
under the ESOP and 4,095 shares held in the Company's 401(k)
Thrift Plan. Ms. Kessler's term as a director will expire
at the Annual Meeting.
(8) Includes 9,643 shares allocated to Mr. Tompson's account
under the ESOP and 978 shares held in the Company's 401(k)
Thrift Plan.
* Less than .1%.
________________________________________________________________
PROPOSAL I -- ELECTION OF DIRECTORS
________________________________________________________________
GENERAL
The Company's Board of Directors currently consists of
eight members. The Company's Articles of Incorporation require
that directors be divided into three classes, as nearly equal in
number as possible, with approximately one-third of the
directors elected each year. At the Annual Meeting, two
directors will be elected for a term expiring at the 2003 Annual
Meeting. The Board of Directors has nominated C. Richard King
and Steven L. Schonert to serve as directors for a three-year
period. Mr. King currently is a member of the Board. Ms.
Kessler's term as a director is expiring at the Annual Meeting,
and Ms. Kessler is retiring from the Board at the expiration of
her current term. The Board of Directors has nominated Mr.
Schonert for election to the Board to fill the vacancy that will
be created upon the expiration of Ms. Kessler's term as a
director. Under Illinois law and the Company's Articles of
Incorporation, directors are elected by a majority of the votes
cast at a meeting at which a quorum is present.
It is intended that the persons named in the proxies
solicited by the Board of Directors will vote for the election
of the named nominees. 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 size of the Board may be reduced to eliminate
the vacancy. At this time, the Board knows of no reason why
either nominee might be unavailable to serve.
The following table sets forth, for each nominee for
director and continuing director of the Company, his age, the
year he first became a director and the expiration of his term
as a director. Each director of the Company, with the exception
of Mr. Graham and Mr. Benson, also is a member of the Board of
Directors of Community Bank & Trust, N.A. ("CB&T"), and Mr.
Benson and Mr. Schonert will be named as directors of CB&T at
CB&T's next annual meeting. In addition, Mr. Graham serves as a
director of MidAmerica Bank of St. Clair County ("MidAmerica"),
and Mr. Benson serves as a director of MidAmerica, American Bank
of Illinois in Highland ("American"), The Egyptian State Bank
("Egyptian") and Saline County State Bank ("Saline"). CB&T,
MidAmerica, American, Egyptian and Saline (collectively, the
"Bank Subsidiaries") are operating subsidiaries of the Company.
4
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Age at Year First Current
December 31, Elected as Term
Name 1999 Director to Expire
---- ----------- ---------- ---------
<S> <C> <C> <C>
BOARD NOMINEES FOR TERMS TO EXPIRE IN 2003
C. Richard King 72 1974 (1) 2000
Steven L. Schonert 43 -- N/A
DIRECTORS CONTINUING IN OFFICE
Michael F. Bauman 53 1990 (1) 2001
Roger A. Charleston 56 1989 (1) 2001
Brad A. Jones 44 1992 (1) 2001
Wayne H. Benson 46 1998 2002
Gary L. Graham 55 1998 2002
Roger L. Haberer 55 1996 2002
<FN>
________
(1) Refers to year first elected as Director of CB&T; each of
these individuals was appointed as a director of the Company
upon its formation in 1994.
</FN>
</TABLE>
Set forth below is information concerning the Company's
directors. Unless otherwise stated, all directors have held the
positions indicated for at least the past five years.
C. Richard King - Mr. King is retired. Mr. King formerly
owned and operated King's Furniture Store. He is a member of
the Bible Fellowship Church and a past member of the Chamber of
Commerce and the Retail Association and the Rotary Club.
Steven L. Schonert - Mr. Schonert has been a partner with
the regional accounting firm of Kemper CPA Group, L.L.C., which
has 19 offices throughout Southern Illinois and Indiana and six
offices in California and Florida, since 1996. He joined the
firm in 1981 and currently manages the Olney office location.
He has served as member-in-charge of the firm's quality
assurance department. He has also been a past member of the
Illinois CPA Society Quality Review Report Acceptance committee.
He is currently a member of the American Institute of Certified
Public Accountants (AICPA) and the Illinois Society of Certified
Public Accountants (ICPA). Mr. Schonert has served as member in
charge for various tax and audit engagements, including clients
in banking, health care, government, manufacturing, wholesale
distribution and employee benefits. Mr. Schonert serves as
Chairman of Finance of First United Methodist Church in Olney
and as Treasurer of Olney Chamber of Commerce, and he is the
past Treasurer of First United Methodist Church, the past
Treasurer of Richland County Country Club and the past President
of Big Brothers/Big Sisters of Richland County.
Michael F. Bauman - Mr. Bauman is the former owner of
Bauman Cement, Inc. and is presently engaged in real estate
investments in the Olney area. He was elected to the Richland
County Board in November 1998. He was a former Chairman of the
City of Olney Police and Fire Boards and a former Committee
Member of the Secretary of State Antique Auto Events Committee,
and served as Chairman of the 1993 Secretary of State Antique
Auto Show held in Springfield, Illinois. Mr. Bauman previously
served as a member of the School Board of East Richland
Community Unit Schools.
Roger A. Charleston serves as Chairman of the Board of the
Company. Mr. Charleston is a civil engineer and the owner of
Charleston Engineering, a consulting firm located in Olney that
provides professional consulting
5
<PAGE>
<PAGE>
engineering services to municipal and county governments in
south/central Illinois. He is City Engineer for various cities
in south/central Illinois and is a member of the Chamber of
Commerce.
Brad A. Jones - Mr. Jones is the co-owner and manager of
Rural King Supply, a retail farm and home store with locations
in Olney, Mt. Carmel, Robinson, Carmi, Salem and Highland. Mr.
Jones also is a member of the Olney Chamber of Commerce. He is
the past regional group president for Mid States Distributing, a
farm products distribution organization.
Wayne H. Benson - Mr. Benson is the President and Chief
Executive Officer of the company and CB&T. He joined CB&T in
1984 as the Branch Manager of CB&T's Lawrenceville Branch. Mr.
Benson also serves on the Board of Directors of the Richland
County Development Corporation, an organization which promotes
economic development and business retention for Richland County.
Mr. Benson is a member of the Board of Directors for Illinois
BancService Corporation, a wholly owned subsidiary of the
Illinois Bankers Association, and he serves on the Board of
Directors of American, MidAmerica, Egyptian and Saline.
Gary L. Graham - Mr. Graham is the Mayor of the City of
O'Fallon, Illinois, and owner of LUCO, Inc., a river barge
business. He serves on the Boards of Belleville Area College
Foundation and the Southwest Illinois YMCA. Mr. Graham also
served on the O'Fallon Planning Commission, Economic Development
Committee, Community Center Major Gift Committee, and the
Chamber of Commerce. He is a member of SWIMPAC, the
Southwestern Illinois Council of Mayors, the Rotary Club,
Shriners, B.P.O.E., and the First United Methodist Church.
Additionally, Mr. Graham was appointed to the East West Gateway
Coordinating Council in 1997 by Governor Edgar and served on the
Southwestern Illinois Regional Airport Task Force as well. Mr.
Graham is also a past President of the St. Louis Coal and
Transportation Exchange, an organizing Board Member of
MidAmerica Bank of St. Clair County, and has served on the Board
of Directors of American Waterways Operators. He served as a
youth soccer coach for many years and as a mentor for Central
School District 104.
Roger L. Haberer - Mr. Haberer is the Information Services
Manager for Westaff, an employment services company. He retired
from the Casey school district after serving twenty-seven years
as a teacher. Mr. Haberer is also a football official for the
Big Ten Conference.
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
The following sets forth information with respect to the
executive officer of the Company who does not serve on the Board
of Directors.
<TABLE>
<CAPTION>
Age at
December 31,
Name 1999 Title
---- ------------ -----
<S> <C> <C>
Douglas W. Tompson 48 Chief Financial Officer
</TABLE>
Douglas W. Tompson - Mr. Tompson has served as CB&T's
Chief Financial Officer since 1988. Prior to that time, he was
the Assistant Corporate Comptroller for Champion Laboratories,
Inc. Mr. Tompson has also been involved as a Cub Scout Leader
and in coaching local youth athletic teams, and has served on
several committees at the St. Joseph Catholic Church and held
several offices in the Olney and state level Elks Lodge. Mr.
Tompson also serves as Secretary-Treasurer for Southeastern
Illinois Residential Organization, which is a non-profit
organization helping provide low income assisted living housing
for the frail and elderly of Southeastern Illinois.
6
<PAGE>
<PAGE>
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company meets monthly and
schedules special meetings as necessary. During the year ended
December 31, 1999, the Board of Directors of the Company met 12
times. No director attended fewer than 75% in the aggregate of
the total number of Company Board of Directors meetings held
during the year ended December 31, 1999 and the total number of
meetings held by committees on which he served during such
fiscal year, except for Director Gary L. Graham. The Board of
Directors has established Audit and Executive Committees to
assist it in discharging its duties. The Executive Committee
also serves as the Compensation Committee. The full Board of
Directors as assisted by the Executive Committee serves as a
Nominating Committee.
The Audit Committee consists of non-employee Directors
Roger L. Haberer, Roger A. Charleston, Shirley B. Kessler and C.
Richard King, who serves as Chairman. The Audit Committee met
three times during the year ended December 31, 1999 to examine
and approve the audit report prepared by the independent
auditors of the Company and the Company's wholly owned
subsidiaries, to review and recommend the independent auditors
to be engaged by the Company, to review the internal audit
function and internal accounting controls, and to review and
approve conflict of interest and audit policies.
The Executive Committee of the Company consists of
Directors Brad A. Jones, Wayne H. Benson, Roger A. Charleston
and Roger L. Haberer. Mr. Haberer, a non-employee director,
serves as Chairman of the Executive Committee. The Executive
Committee meets only as needed and has the authority to exercise
the powers of the Board of Directors when the Board of Directors
is not in session. The Committee has the power to exercise most
powers of the Board of Directors in the intervals between
meetings of the Board, and any activity is reported to the Board
monthly. The Executive Committee met six times during the year
ended December 31, 1999.
The Executive Committee of the Board of Directors
considers and recommends potential nominees to the Board of
Directors. The full Board of Directors acts as a nominating
committee for the selection of management's nominees to the
Board of Directors. During the year ended December 31, 1999,
the Executive Committee met twice to discuss potential nominees
for recommendation to the Board of Directors. The Board of
Directors met once as a nominating committee during the year
ended December 31, 1999. In its deliberations, the Executive
Committee, functioning as a nominating committee, considers the
candidate's knowledge of the banking business and involvement in
community, business and civic affairs, and also considers
whether the candidate would allow the Board to continue its
geographic diversity that provides for adequate representation
of its market area. The Company's Articles of Incorporation set
forth procedures that must be followed by stockholders seeking
to make nominations for directors. In order for a stockholder
of the Company to make any nominations, he or she must give
written notice thereof to the Secretary of the Company not less
than thirty days nor more than sixty days prior to the date of
any such meeting; provided, however, that if less than forty
days' notice of the meeting is given to stockholders, such
written notice shall be delivered or mailed, as prescribed, to
the Secretary of the Company not later than the close of
business on the tenth day following the day on which notice of
the meeting was mailed to stockholders. Each such notice given
by a stockholder with respect to nominations for the election of
directors must set forth (i) the name, age, business address
and, if known, residence address of each nominee proposed in
such notice; (ii) the principal occupation or employment of each
such nominee; and (iii) the number of shares of stock of the
Company which are beneficially owned by each such nominee. In
addition, the stockholder making such nomination must promptly
provide any other information reasonably requested by the
Company.
The Executive Committee of the Board of Directors also
serves as a compensation committee. While acting as a
compensation committee, the Executive Committee evaluates the
compensation and benefits of the directors, officers and
employees, recommends changes, and monitors and evaluates
employee morale. Directors who also are officers abstain from
discussion and voting on matters affecting their compensation.
The Executive Committee met two times as a compensation
committee during the year ended December 31, 1999. The full
Board of Directors approved the recommendations of the Executive
Committee at one of its regular Board meetings.
7
<PAGE>
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table. The following table sets
forth cash and noncash compensation for fiscal 1999, 1998 and
1997 awarded to or earned by the Chief Executive Officer and the
other highest paid executive officer of the Company, as well as
the individual who served as the Company's Chief Executive
Officer during a portion of fiscal 1999, whose salary and bonus
earned in fiscal 1999 exceeded $100,000. No other executive
officer received salary and bonus in excess of $100,000 during
the fiscal years ended December 31, 1999, 1998 or 1997.
<TABLE>
<CAPTION>
Long-Term Compensation
-----------------------------------------
Awards Payouts
------------------------ -------------
Name and Annual Compensation(1) Restricted Securities
Principal --------------------- Stock Underlying All Other
Position Year Salary Bonus Award(s)(2) Options(#) Compensation
- ---------- ---- ------- ----- ------------ ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Wayne H. Benson 1999 $100,000 $ -- -- -- $21,020 (3)
Chief Executive 1998 89,751 9,000 -- -- 34,456
Officer 1997 87,733 35,253 -- -- 14,666
Douglas W. Tompson 1999 93,000 -- -- -- 5,276 (3)
Chief Financial 1998 88,633 8,600 -- -- 9,403
Officer 1997 86,641 34,814 -- -- 4,141
Shirley B. Kessler 1999 135,000 -- -- -- 19,704 (3)
President (4) 1998 124,525 12,500 -- -- 30,602
1997 121,726 48,912 -- -- 19,710
<FN>
________
(1) Executive officers receive indirect compensation in the form of certain
perquisites and other personal benefits. The amount of such benefits
received by the named executive officers in fiscal 1998 did not exceed
10% of the executive officer's salary and bonus.
(2) As of December 31, 1999, Messrs. Benson and Tompson each had 5,036 shares
of restricted Common Stock. Of the unvested shares, 2,518 were scheduled
to vest on each of January 12, 2000 and 2001. As of December 31, 1999,
based on the closing sale prices of the Common Stock of $9.375, as
reported on the Nasdaq National Market System, the aggregate value of the
unvested restricted Common Stock held by each of Messrs. Benson and
Tompson was $47,213. In the event the Company pays dividends with
respect to its Common Stock, when shares of restricted stock vest and/or
are distributed, the holder will be entitled to receive any cash
dividends and a number of shares of Common Stock equal to any stock
dividends, declared and paid with respect to a share of restricted Common
Stock between the date the restricted stock was awarded and the date the
restricted stock is distributed, plus interest on cash dividends,
provided that dividends paid with respect to unvested restricted stock
must be repaid to the Company in the event the restricted stock is
forfeited prior to vesting. On December 31, 1999 as a result of her retirement,
17,353 shares of restricted stock previously awarded to Ms. Kessler vested.
(3) Includes: (i) contributions of $6,000, $2,790 and $5,870 made by CB&T in
fiscal 1999 for the account of Mr. Benson and Mr. Tompson and Ms.
Kessler, respectively, pursuant to CB&T's 401(k) Thrift Plan; (ii)
$11,334 paid by the Company to a trust for the benefit of Ms. Kessler
pursuant to a Supplemental Executive Retirement Agreement with such
individual; (iii) $2,320 and $2,486 paid by the Company to purchase
disability insurance for the benefit of Mr. Benson and Mr. Tompson,
respectively; and (iv) $12,700 and $2,500 paid to Mr. Benson and Ms.
Kessler, respectively, for service as directors of the Company's
subsidiary banks.
(4) Ms. Kessler retired as President of the Company effective December 31,
1999.
</FN>
</TABLE>
8
<PAGE>
<PAGE>
Year-End Option Values. The following table sets forth
information concerning the value as of December 31, 1999 of
options held by the executive officers named in the Summary
Compensation Table set forth above.
<TABLE>
<CAPTION>
Number of Value of
Securities Underlying Unexercised
Unexercised Options In-the-Money Options
at Fiscal Year-End at Fiscal Year-End (1)
Name Exercisable/Unexercisable Exercisable/Unexercisable
---- ------------------------- -------------------------
<S> <C> <C>
Wayne H. Benson 38,617/-- $--/$--
Douglas W. Tompson 26,450/-- $--/$--
Shirley B. Kessler 43,378/-- $--/$--
<FN>
________
(1) At December 31, 1999, the exercise price of $13.125 per share was
below the fair market value of the underlying Common Stock of $9.375
as quoted on the Nasdaq National Market System.
</FN>
</TABLE>
No options were granted to or exercised by executive
officers during fiscal year 1999, and no options held by any
executive officer of the Company repriced during the past ten
full fiscal years.
Employment Agreements. The Company and CB&T have entered
into employment agreements (the "Employment Agreements") with
Mr. Benson and Mr. Tompson (collectively, the "Employees").
The Employment Agreements currently provide Mr. Benson and
Mr. Tompson with annual base salaries of $130,000 and $94,860,
respectively. The Employment Agreements with Mr. Benson expire
in August 2001, and the Employment Agreements with Mr. Tompson
expire in June 2000. On each anniversary date from the date of
commencement of the Employment Agreements, the term of
employment may be extended for up to a three-year term beyond
the then effective expiration date, upon a determination by the
Board of Directors that the performance of each Employee has met
the required performance standards and that each Employment
Agreement should be extended. The Employment Agreements provide
the Employees with salary reviews by the Board of Directors not
less often than annually, as well as inclusion in any
discretionary bonus plans, retirement and medical plans, related
benefits and vacation and sick leave. An Employment Agreement
will terminate upon an Employee's death or disability, and is
terminable for "just cause" as defined in the Employment
Agreements. In the event of termination for just cause, no
severance benefits are available. If the Employee is terminated
without just cause, the Employee will be entitled to a
continuation of his salary and benefits from the date of
termination through the remaining term of the Employment
Agreement plus an additional 12-month period, but not to exceed
three years' salary. Severance benefits payable to an Employee
or to his estate will be paid in a lump sum or in installments,
as the Employee elects. If an Employment Agreement is
terminated due to an Employee's "disability" (as defined in the
Employment Agreements), the Employee will not be entitled to a
continuation of his salary and benefits. In the event of an
Employee's death during the term of his Employment Agreement,
the Employee's estate will be entitled to receive his salary
through the last day of the calendar month in which the death
occurred. An Employee may voluntarily terminate his Employment
Agreement by providing 60 days' written notice to the Boards of
Directors of CB&T and the Company, in which case the Employee is
entitled to receive only his compensation, vested rights and
benefits up to the date of termination.
The Employment Agreements provide that in the event of an
Employee's involuntary termination of employment in connection
with, or within one year after, any change in control of CB&T or
the Company, other than for "just cause," the Employee will be
paid within 10 days of such termination an amount equal to the
difference between (i) 2.99 times his "base amount," as defined
in Section 280G(b)(3) of the Internal Revenue Code, and (ii) the
sum of any other parachute payments, as defined under Section
280G(b)(2) of the Internal Revenue Code, that the Employee
receives on account of the change in control. "Control"
generally refers to the acquisition, by any person or entity, of
the ownership or power to vote more than 25% of CB&T's or
Company's voting stock, the control of the
9
<PAGE>
<PAGE>
election of a majority of CB&T's or the Company's directors, or
the exercise of a controlling influence over the management or
policies of CB&T or the Company. In addition, under the
Employment Agreements, a change in control occurs when, during
any consecutive two-year period, directors of the Company or
CB&T at the beginning of such period cease to constitute a
majority of the Board of Directors of the Company or CB&T,
unless the election of replacement directors was approved by a
majority vote of the initial directors then in office. The
Employment Agreements with CB&T provide that within 5 business
days of a change in control, CB&T shall fund, or cause to be
funded, a trust in the amount of 2.99 times each Employee's base
amount, that will be used to pay the Employees amounts owed to
them upon termination, other than for just cause, within one
year of the change in control. The amount to be paid to an
Employee from this trust upon his termination is determined
according to the procedures outlined in the Employment
Agreements with CB&T, and any money not paid to an Employee is
returned to CB&T. The Employment Agreements also provide for a
similar lump sum payment to be made in the event of an
Employee's voluntary termination of employment within one year
following a change in control, upon the occurrence, or within 90
days thereafter, of certain specified events following the
change in control, which have not been consented to in writing
by an Employee, including (i) the requirement that the Employee
perform his principal executive functions more than 35 miles
away from CB&T's current primary office, (ii) a material
reduction in the Employee's base compensation as then in effect,
(iii) the failure of the Company or CB&T to maintain existing or
substantially similar employee benefit plans, including material
vacation, fringe benefits, stock option and retirement plans, as
the same may be changed by mutual agreement from time to time,
or with benefits substantially similar to those provided to him
under any employee benefit plan in which the Employee is a
participant at the time of the change in control, (iv) the
assignment to the Employee of duties and responsibilities which
are materially different from those normally associated with his
position with CB&T, (v) a material reduction in the Employee's
authority and responsibility, and (vi) the failure to re-elect
the Employee to the Company's or CB&T's Board of Directors if he
is serving on the Board on the date of the change in control.
The aggregate payments that would be made to Mr. Benson and Mr.
Tompson assuming termination of their employment under the
foregoing circumstances at December 31, 1999, would have been
approximately $388,700 and $283,631, respectively. These
provisions may have an anti-takeover effect by making it more
expensive for a potential acquirer to obtain control of the
Company. In the event that an Employee prevails over the
Company and CB&T in a legal dispute as to the Employment
Agreements, he will be reimbursed for his legal and other
expenses.
Supplemental Executive Retirement Agreements. Messrs.
Benson and Tompson and Ms. Kessler (collectively, the
"Executives") and CB&T entered into supplemental executive
retirement agreements (the "SERAs") effective January 1, 1995.
Pursuant to the terms of the SERAs, each year CB&T will credit
an account for each Executive with the amount, if any, by which
(i) the sum of any annual additions allocated to the Executive's
account under the ESOP and any other tax-qualified, defined
contribution plan maintained by CB&T or the Company (measured
without regard to the limitations on annual additions imposed
under Internal Revenue Code Section 415), exceeds (ii) the limit
imposed on annual additions by Internal Revenue Code Section
415(c)(1) and any regulations thereunder. In addition, if the
limitation imposed by Section 415(e) of the Internal Revenue
Code reduces the benefit that the Executive accrues under any
defined benefit pension plan maintained by CB&T, CB&T shall, as
soon as practicable after the close of the plan year in which
said reduction occurs, contribute to the Executive's account an
amount equal to the present value of such reduction.
Upon an Executive's termination of employment with the
Company or CB&T, for reasons other than death or removal for
"just cause," CB&T will pay the balance of the Executive's
account to the Executive in ten substantially equal annual
installments. In the event that the Executive dies before all
benefit payments have been made to him, CB&T shall pay to the
Executive's beneficiary (or estate, if he has no beneficiary) a
lump sum payment, within 60 days following the Executive's
death, in an amount equal to the balance of the Executive's
account. Termination for "just cause" (as defined in the SERAs)
would result in the forfeiture of all benefits under the SERAs.
In the event of a change in control (as defined in the SERAs),
the balance in the Executive's account shall be due and payable
to the Executive in one lump sum payment within 10 days
following such change in control. CB&T has established an
irrevocable grantor trust to hold assets in order to provide a
source of funds to assist it in meeting its liabilities under
the SERAs. The assets of such trust will remain general assets
of CB&T and be subject to the claims of its general creditors.
10
<PAGE>
<PAGE>
The SERA with Ms. Kessler was terminated in connection
with her retirement.
Deferred Compensation Plan. CB&T's Board of Directors has
established the Deferred Compensation Plan for the exclusive
benefit of members of CB&T's Board of Directors who are not
employees of CB&T, CB&T's President and Executive Vice President
and such other executive officers of CB&T which the Board of
Directors may identify by resolution as being eligible to
participate in the Deferred Compensation Plan. Pursuant to the
terms of the Deferred Compensation Plan, directors may elect to
defer the receipt of all or part of their future fees, and other
plan participants may elect to defer receipt of up to 25% of
their future compensation. Deferred amounts will be credited to
a bookkeeping account in the participant's name, which will also
be credited quarterly with the investment return which would
have resulted if such deferred amounts had been invested, based
upon the participant's choice, in either Common Stock or in a
fund with a return equal to CB&T's annual rate of interest on
one year certificates of deposit. Participants may determine
the time and form of benefit payments and may cease future
deferrals any time. Changes in participant elections generally
become effective only as of the following January 1st, except
that (i) elections designating a beneficiary or ceasing future
contributions will be given immediate effect, and (ii)
participants may change elections as to the timing or form of
distributions only with respect to subsequently deferred
compensation. CB&T contributes the aggregate amounts deferred
to a trust associated with the Deferred Compensation Plan to
assist it in meeting its obligations under the Deferred
Compensation Plan. Contributions to such trust are made on a
quarterly basis and the funds will be used for eventual payments
to participants.
DIRECTOR COMPENSATION
During the year ended December 31, 1999, no fees were paid
for service as a director of the Company. Instead, directors of
the Company received fees for serving as directors of the
Company's subsidiary banks as shown below.
<TABLE>
<CAPTION>
Other
Chairman Nonemployee Directors
-------- ---------------------
<S> <C> <C>
Annual fee for service on CB&T Board $15,000 $5,000
Per Board Meeting Attended -- 350
Per Committee Meeting Attended -- 100
</TABLE>
Mr. Graham received a fee of $500 per MidAmerica Board
meeting attended. Ms. Kessler received a fee of $500 per
MidAmerica Board meeting attended, and Mr. Benson received fees
of $500, $400 and $450, respectively, per MidAmerica, American
and Egyptian and Saline Board meetings attended. MidAmerica
suspended the payment of Board fees for seven months during the
year ended December 31, 1999. Directors who are also members of
the Board of CB&T also are eligible to participate in the
Community Bank & Trust, N.A. Deferred Compensation Plan (the
"Deferred Compensation Plan"). See " -- Executive Compensation
- -- Deferred Compensation Plan." Directors also are eligible to
participate in the Company's 1996 Stock Option and Incentive
Plan ("Option Plan"). No awards were made to directors under
the Option Plan during the year ended December 31, 1999.
In order to more closely align stockholder and director
interests, in November 1999, the Board of Directors voted to
change this fee structure effective January 1, 2000. It is
still the case that no fees are paid for service as a director
of the Company and that directors of the Company receive fees
for serving as directors of the Company's subsidiary banks.
However, effective January 1, 2000, annual retainer fees will be
paid at the end of the Company's fiscal year in the form of
Company Common Stock, and cash retainer fees will no longer be
paid. Under the new structure, effective January 1, 2000, fees
will be paid as follows:
11
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Other Nonemployee
Directors Who
Who Serves as Wayne
Chairman Director of CB&T Benson
-------- ---------------- ------
<S> <C> <C> <C>
Annual fee $5,000/1,000 shares 500 shares --
Per Board Meeting
Attended -- $350 --
Per Committee Meeting
Attended -- $100 --
</TABLE>
Mr. Graham will continue to receive a fee of $500 per MidAmerica
Board meeting attended. Mr. Benson will receive fees of $500,
$400 and $450 per MidAmerica, American and Egyptian and Saline
Board meetings attended, respectively. Directors who are also
members of the Board of CB&T also will continue to be eligible
to participate in the Community Bank & Trust, N.A. Deferred
Compensation Plan (the "Deferred Compensation Plan"). See " --
Executive Compensation -- Deferred Compensation Plan."
Directors also will continue to be eligible to participate in
the Option Plan.
TRANSACTIONS WITH MANAGEMENT
The Bank Subsidiaries offer loans to their directors and
officers. These loans currently are made in the ordinary course
of business with the same collateral, interest rates and
underwriting criteria as those of comparable transactions
prevailing at the time and do not involve more than the normal
risk of collectibility or present other unfavorable features.
Under current law, loans to directors and executive officers are
required to be made on substantially the same terms, including
interest rates, as those prevailing for comparable transactions
and must not involve more than the normal risk of repayment or
present other unfavorable features. Furthermore, all loans
above $500,000 to such persons must be approved in advance by a
disinterested majority of the Board of Directors. At December
31, 1999, the Bank Subsidiaries' loans to directors and
executive officers totaled $1.4 million, or 4.2% of the
Company's stockholders' equity, at that date.
________________________________________________________________
PROPOSAL II -- STOCKHOLDER PROPOSAL
________________________________________________________________
In his definitive proxy materials filed with the
Securities and Exchange Commission, Mr. Rochman indicated his
intent to solicit proxies in favor of the following proposal:
"RESOLVED, that the stockholders of Community Financial
Corp., present in person or by proxy, recommend that the Board
of Directors (a) engage the services of a consultant or other
advisor which has experience in advising financial institutions
to make recommendations to the Board of Directors as to specific
actions designed to improve earnings of Community Financial
Corp. and enhance stockholder value, and (b) prepare a report
regarding the advisor's or consultant's recommendations, at
reasonable expense, for distribution to stockholders within six
months of this meeting of stockholders."
As the Company recently announced, the Board of Directors
has adopted a new strategic plan for the Company and the Bank
Subsidiaries. This plan reflects several months of effort on
the part of the Board and management, together with Professional
Bank Services, a nationally recognized bank consulting group
retained by the Company. THE PRIMARY FOCUS AND GOAL OF THE
STRATEGIC PLAN IS TO MAXIMIZE SHAREHOLDER VALUE.
The Company expects the implementation of the Plan will
increase earnings while decreasing liquidity and interest rate
risks, through numerous initiatives in the areas of operating
efficiency, asset and liability mix and productivity. The
strategic plan calls for the Company to take a variety of
actions to increase operating efficiency, including
consolidating the charters of its subsidiary banks, reducing or
limiting operating expenses and using
12
<PAGE>
<PAGE>
technology to enhance efficiency. A significant feature of the
Plan relates to changes in the asset and liability mix.
Specifically, the Company will seek to become more "bank" like
by increasing construction, agricultural and commercial real
estate loans while decreasing its emphasis on residential
lending. SUCCESSFUL IMPLEMENTATION OF OUR STRATEGIC PLAN WILL
ENABLE THE COMPANY TO UNDERTAKE A SIGNIFICANT STOCK REPURCHASE
PROGRAM.
As part of the strategic planning process, the Board
diligently explored all of the Company's options and concluded
that this strategic plan represents the Company's best
opportunity to maximize long-term shareholder value.
Since the Company has already substantially completed the
actions that Mr. Rochman seeks with his proposal, the Board
believes his proposal is moot and the Board unanimously
recommends that stockholders vote AGAINST it.
STOCKHOLDERS WISHING TO VOTE ON THIS PROPOSAL WILL BE
AFFORDED AN OPPORTUNITY TO DO SO ON THE ENCLOSED WHITE PROXY
CARD. THE COMPANY OPPOSES THIS PROPOSAL AND RECOMMENDS THAT
STOCKHOLDERS VOTE AGAINST THIS PROPOSAL.
________________________________________________________________
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
________________________________________________________________
Larsson, Woodyard, & Henson, CPAs, was the Company's
independent auditor for the 1999 fiscal year. No firm has been
retained to date by the Board of Directors to be the Company's
auditor for the 2000 fiscal year, pending a review of the
Company's needs and the anticipated fees to be charged by an
audit firm. A representative of Larsson, Woodyard & Henson,
CPAs is expected to be present at the Annual Meeting, will have
the opportunity to make a statement if he or she so desires and
is expected to be available to respond to appropriate questions.
________________________________________________________________
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
________________________________________________________________
Pursuant to regulations promulgated under the Exchange
Act, the Company's officers and directors and all persons who
own more than ten percent of the Common Stock ("Reporting
Persons") are required to file reports detailing their ownership
and changes of ownership in the Common Stock and to furnish the
Company with copies of all such ownership reports that are
filed. Based solely on the Company's review of the copies of
such ownership reports which it has received in the past fiscal
year or with respect to the past fiscal year, or written
representations that no annual report of changes in beneficial
ownership were required, the Company believes that during fiscal
year 1999 and prior fiscal years all Reporting Persons have
complied with these reporting requirements, except that due to
an oversight Director Gary L. Graham filed one late report
regarding a single transaction.
________________________________________________________________
OTHER MATTERS
________________________________________________________________
The Board of Directors is not aware of any business to
come before the Annual Meeting other than those matters
described above in this proxy statement and matters incident to
the conduct of the Annual Meeting. However, if any other
matters should properly come before the Annual Meeting, it is
intended that proxies in the accompanying form will be voted in
respect thereof in accordance with the determination of a
majority of the Board of Directors.
________________________________________________________________
MISCELLANEOUS
________________________________________________________________
The cost of soliciting proxies will be borne by the
Company. The Company will reimburse brokerage firms and other
custodians, nominees and fiduciaries for reasonable expenses
incurred by them in sending proxy materials to the beneficial
owners of Common Stock. In addition to solicitations by mail,
directors, officers and regular employees of the Company may
solicit proxies personally or by telegraph, telephone or other
electronic means without
13
<PAGE>
<PAGE>
additional compensation therefor. The Company has retained D.F.
King & Co., Inc. ("D.F. King") to assist in the solicitation of
proxies for a fee estimated at $40,000 plus expenses. It is
anticipated that approximately 25 persons will be used by D. F.
King in its solicitation efforts. Total expenditures for the
solicitation of proxies (including fees of attorneys,
accountants, public relations or financial advisors, solicitors,
printing, transportation and other costs incidental to the
solicitation but excluding the amount normally expended for a
solicitation for an election of directors) are estimated to be
$150,000, and total cash expenditures to date have been
approximately $35,000.
The Company's 1999 Annual Report to Stockholders,
including financial statements, is being mailed to all
stockholders of record as of the close of business on the Record
Date. Any stockholder who has not received a copy of such
Annual Report may obtain a copy by writing to the Secretary of
the Company. Such Annual Report is not to be treated as a part
of the proxy solicitation material or as having been
incorporated herein by reference.
________________________________________________________________
STOCKHOLDER PROPOSALS
________________________________________________________________
Under the Company's Articles of Incorporation, stockholder
proposals must be submitted in writing to the Secretary of the
Company at the address stated later in this paragraph no less
than 30 days nor more than 60 days prior to the date of such
meeting; provided, however, that if less than forty days' notice
of the meeting is given to stockholders, such written notice
shall be delivered or mailed, as prescribed, to the Secretary of
the Company not later than the close of business on the tenth
day following the day on which notice of the meeting was mailed
to stockholders. For consideration at the Annual Meeting, a
stockholder proposal must be delivered or mailed to the
Company's Secretary no later than March 28, 2000.
Pursuant to the requirements of Rule 14a-8 under the
Exchange Act, in order to be eligible for inclusion in the
Company's proxy materials for next year's Annual Meeting of
Stockholders, any stockholder proposal must be received at the
Company's executive office at 240 E. Chestnut Street, Olney,
Illinois 62450-2295, no later than November 14, 2000. Any such
proposal shall be subject to the requirements of the proxy rules
adopted under the Exchange Act.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Steven Walser
Steven Walser
Secretary
March 14, 2000
Olney, Illinois
________________________________________________________________
ANNUAL REPORT ON FORM 10-K
________________________________________________________________
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR
THE FISCAL YEAR ENDED DECEMBER 31, 1999 AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION WILL BE FURNISHED WITHOUT
CHARGE TO EACH STOCKHOLDER AS OF THE RECORD DATE UPON WRITTEN
REQUEST TO CORPORATE SECRETARY, COMMUNITY FINANCIAL CORP., 240
E. CHESTNUT STREET, OLNEY, ILLINOIS 62450-2295.
________________________________________________________________
14
<PAGE>
<PAGE>
SCHEDULE A
INFORMATION CONCERNING THE DIRECTORS AND CERTAIN OFFICERS
The following table sets forth the name and the present
principal occupation or employment (except with respect to the
directors and the nominee for director, whose principal
occupation is set forth in the Proxy Statement), and the name,
principal business and address of any corporation or other
organization in which such employment is carried on, of the
directors and certain officers of the Company and/or its
subsidiary banks who may assist in soliciting proxies from the
Company's shareholders. Unless otherwise indicated below, the
principal business address of each such person is 240 E.
Chestnut Street, Olney, Illinois 62450-2295 and such person is
an employee of the Company or the indicated subsidiary bank.
Directors are indicated with an asterisk.
<TABLE>
<CAPTION>
PRESENT OFFICER OR OTHER
NAME AND PRINCIPAL BUSINESS ADDRESS PRINCIPAL OCCUPATION OR EMPLOYMENT
- ----------------------------------- ----------------------------------
<S> <C>
C. Richard King *
Retired
Michael F. Bauman *
Real Estate Owner
1208 Hall Court
Olney, IL 62450
Roger A. Charleston *
Civil Engineer
105 N. Kitchell
Olney, IL 62450
Brad A. Jones *
Co-Owner and Manager
of Rural King Supply
Rt. 130 South
Olney, IL 62450
Wayne H. Benson * President and Chief Executive Officer
of the Company and CB&T
Gary L. Graham *
Mayor of the City O'Fallon
Owner of LUCO, Inc.
807 W. Highway 50
O'Fallon, IL 62269
A-1
<PAGE>
<PAGE>
PRESENT OFFICER OR OTHER
NAME AND PRINCIPAL BUSINESS ADDRESS PRINCIPAL OCCUPATION OR EMPLOYMENT
- ----------------------------------- ----------------------------------
<S> <C>
Roger L. Haberer *
Information Services Manager
Westaff
1530 Lakeland Blvd.
Mattoon, IL 61938
Steven L. Schonert *
Kemper CPA
1213 S. Wost
Olney, IL 62450
Douglas W. Tompson Chief Financial Officer of the
Company and CB&T
Sharon Sue Piper Assistant Vice President of CB&T
Jeffrey L. Wilson Vice President of CB&T
Deborah L. Keller Secretary of CB&T
Assistant Secretary of the Company
</TABLE>
A-2
<PAGE>
<PAGE>
SCHEDULE B
SHARES HELD BY DIRECTORS AND CERTAIN EXECUTIVE OFFICERS
AND CERTAIN TRANSACTIONS IN THE SECURITIES OF
COMMUNITY FINANCIAL CORP. WITHIN THE PAST TWO YEARS
The shares of Common Stock held by the Company's
directors
and nominees for director are set forth in the Proxy Statement.
The following executive officer of the Company and/or one of its
bank subsidiaries owns the following shares:
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED (1)
------------------------ ----------------------
<S> <C>
Douglas W. Tompson 51,761
<FN>
___________
(1) Includes 26,450 shares which may be purchased pursuant to
the exercise of stock options by Mr. Tompson.
</FN>
</TABLE>
The following table sets forth information with respect
to all purchases and sales of shares of Common Stock of the
Company by the directors and certain executive officers of the
Company and/or the Bank during the past two years.
<TABLE>
<CAPTION>
NUMBER OF SHARES DATE
---------------- ----
<S> <C> <C>
C. RICHARD KING 793 1-14-99 (1)
1,586 1-14-00 (1)
MICHAEL F. BAUMAN 793 1-14-99 (1)
1,586 1-14-00 (1)
ROGER A. CHARLESTON 240 11-24-98 (2)
793 1-14-99 (1)
600 2-26-99 (2)
1,000 5-26-99 (2)
1,586 1-14-00 (1)
BRAD A. JONES 793 1-14-99 (1)
1,586 1-14-00 (1)
WAYNE H. BENSON 600 8-12-98 (2)
3,000 5-18-98 (2)
2,518 1-14-99 (1)
200 9-17-99 (2)
5,036 1-14-00 (1)
GARY L. GRAHAM 1,000 3-24-98 (2)
423 1-14-99 (1)
1,000 8-24-99 (3)
1,693 1-14-00 (1)
B-1
<PAGE>
<PAGE>
NUMBER OF SHARES DATE
---------------- ----
<S> <C> <C>
Shirley B. Kessler 51 1-15-98 (2)
800 8-17-98 (2)
3,111 1-14-99 (1)
103 1-15-99 (2)
6,222 12-31-99 (1)
Roger L. Haberer 423 1-14-99 (1)
200 12-3-99 (2)
500 12-15-99 (3)
1,693 1-14-00 (1)
Steven L. Schonert 100 8-25-99 (2)
100 12-13-99 (2)
800 12-17-99 (2)
Douglas W. Tompson 2,518 1-14-99 (1)
5,036 1-14-00 (1)
<FN>
__________
(1) Vesting of shares of restricted stock awarded under
Management Recognition Plan.
(2) Open market purchase.
(3) Open market sale.
</FN>
</TABLE>
Other than as disclosed in this Schedule or in the Proxy
Statement, none of the Company, any of its directors or
executive officers named in this Schedule owns any securities of
the Company or any subsidiary thereof, beneficially or of
record, has purchased or sold any of such securities within the
last two years, or is or was within the past year a party to any
contract, arrangement or understanding with any person with
respect to any such securities. Except as disclosed in this
Schedule or in the Proxy Statement, to the knowledge of the
Company, none of the Company, its directors and executive
officers named in this Schedule, has any substantial interest,
direct or indirect, by security holdings or otherwise, in any
matter to be voted upon at the Annual Meeting.
Other than as disclosed in this Schedule or in the Proxy
Statement, to the knowledge of the Company, none of the Company,
its directors or executive officers named in this Schedule is,
or has been within the past year, a party to any contract,
arrangement or understanding with any person with respect to any
class of securities of the Company, including, but not limited
to, joint ventures, loan or option arrangements, puts or calls,
guarantees against loss or guarantees of profit, division of
losses or profits, or the giving or withholding of proxies.
Other than as set forth in this Schedule or in the Proxy
Statement, to the knowledge of the Company, none of the Company,
its directors or executive officers named in this Schedule, or
any of their associates, has had or will have a direct or
indirect material interest in any transaction or series of
transactions since the beginning of the Company's last fiscal
year or any currently proposed transactions, or series of
similar transactions, to which the Company or any of its
subsidiaries was or is to be a party in which the amount
involved exceeds $60,000.
Other than as set forth in this Schedule or in the Proxy
Statement, to the knowledge of the Company, none of the Company,
its directors or executive officers named in this Schedule, or
any of their associates, has any arrangements or understandings
with any person or persons with respect to any future employment
by the Company or its affiliates or with respect to any future
transactions to which the Company or any of its affiliates will
or may be a party.
B-2
<PAGE>
<PAGE>
I M P O R T A N T
Your vote is important. Regardless of the number of
shares of Community Financial Corp. Common Stock you own, please
vote as recommended by your Board of Directors by taking these
two simple steps:
1. PLEASE SIGN, DATE AND PROMPTLY MAIL the enclosed
Community Financial WHITE PROXY CARD in the postage-
paid envelope provided.
2. DO NOT RETURN ANY BLUE PROXY CARD sent to you by Mr.
B. Rochman, not even as a vote of protest.
IF YOU VOTED MR. ROCHMAN'S BLUE PROXY CARD BEFORE RECEIVING
YOUR COMMUNITY FINANCIAL CORP. WHITE PROXY CARD, YOU HAVE EVERY
RIGHT TO CHANGE YOUR VOTE SIMPLY BY SIGNING, DATING AND MAILING
THE ENCLOSED WHITE PROXY CARD. THIS WILL CANCEL YOUR EARLIER
VOTE. REMEMBER, ONLY YOUR LATEST DATED PROXY CARD WILL COUNT AT
THE ANNUAL MEETING.
INSTRUCTIONS FOR "STREET" NAME SHAREHOLDERS
If you own your shares in the name of a brokerage firm (or
other nominee), only your broker can vote your shares on your
behalf and only after receiving your specific instructions.
Please call your broker and instruct him/her to execute a
Community Financial WHITE PROXY card on your behalf. You should
also promptly sign, date and mail your WHITE PROXY card when you
receive it from your broker. Please do so for each separate
account you maintain.
You should return your WHITE PROXY card at once to ensure
that your vote is counted.
IF YOU HAVE ANY QUESTIONS OR NEED ASSISTANCE IN VOTING YOUR
SHARES, PLEASE CALL D.F. KING, WHICH IS ASSISTING US,
TOLL-FREE AT (888) 242-8155.
<PAGE>
<PAGE>
REVOCABLE PROXY
COMMUNITY FINANCIAL CORP.
OLNEY, ILLINOIS
ANNUAL MEETING OF STOCKHOLDERS APRIL 27, 2000
The undersigned hereby appoints Brad A. Jones, Michael F.
Bauman and Roger L. Haberer, with full powers of substitution,
to act as attorneys and proxies for the undersigned, to vote all
shares of the common stock of Community Financial Corp. (the
"Company") which the undersigned is entitled to vote at the
Annual Meeting of Stockholders, to be held at The Holiday Motel,
located at 1300 S. West Street, Olney, Illinois, on Thursday,
April 27, 2000, at 11:00 a.m. (the "Annual Meeting"), and at any
and all adjournments thereof, as follows:
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS PROXY WILL BE VOTED FOR PROPOSAL NO. I AND
AGAINST PROPOSAL NO. II. IF ANY OTHER BUSINESS IS PRESENTED AT
THE ANNUAL MEETING, INCLUDING MATTERS RELATING TO THE CONDUCT OF
THE ANNUAL MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN
THIS PROXY IN ACCORDANCE WITH THE DETERMINATION OF A MAJORITY OF
THE BOARD OF DIRECTORS. AT THE PRESENT TIME, THE BOARD OF
DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE
ANNUAL MEETING.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
<PAGE>
<PAGE>
[X] Please mark your votes as in this example
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL
NO. I.
VOTE
FOR WITHHELD
---- --------
I. The election as directors of all
nominees listed below (except as
marked to the contrary below). [ ] [ ]
C. Richard King
Steven L. Schonert
INSTRUCTION: To withhold your vote for any individual
nominee, insert that nominee's name on the line provided
below.
________________________________
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" THE FOLLOWING
STOCKHOLDER PROPOSAL
FOR AGAINST ABSTAIN
---- -------- -------
II. A stockholder proposal, as
described in the Company's
Proxy Statement dated March
14, 2000. [ ] [ ] [ ]
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
This proxy revokes all previously executed proxies.
The undersigned acknowledges receipt from the Company prior to
the execution of this proxy of a Notice of Annual Meeting and a
Proxy Statement dated March 14, 2000.
________________________________
________________________________
SIGNATURE(S) OF STOCKHOLDER
Dated: ________________, 2000
Please sign exactly as your name appears above. When
signing as attorney, executor, administrator, trustee or
guardian, please give your full title. Corporation proxies
should be signed in corporate name by an authorized officer. If
shares are held jointly, each holder should sign.
PLEASE SIGN, DATE AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
