SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
COMMUNITY FINANCIAL CORP.
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(Name of Registrant as Specified In Its Charter)
BARRETT R. ROCHMAN
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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<PAGE>
BARRETT R. ROCHMAN
1345 East Park Street
Carbondale, Illinois 62901
(800) 529-3513
______________, 2000
Dear Fellow Stockholder:
Enclosed are my proxy statement and proxy card relating to the 2000
annual meeting of stockholders of Community Financial Corp. ("Community
Financial") and, if directors are not elected at the annual meeting, the next
meeting of stockholders at which directors are elected. I decided to solicit
your vote in favor of electing Michael B. Nadler and me to the Board of
Directors of Community Financial because I am disappointed, among other reasons,
with the financial performance and stock price of Community Financial. I also am
soliciting proxies in favor of my stockholder proposal recommending that the
Board of Directors of Community Financial hire an advisor or other consultant
which specializes in financial institutions to make recommendations of specific
actions designed to improve earnings and enhance stockholder value at Community
Financial.
As my proxy statement indicates, I am soliciting proxies to elect the 2
directors of Community Financial who are up for election at the 2000 annual
meeting of stockholders. I do have past experience with the board of directors
of a publicly-held company, having served on the board of directors of Heartland
Bancshares, a bank holding company in Herrin, Illinois, until the time of its
sale to Banterra Corp. in 1999. Mr. Nadler has over 20 years of experience in
the banking industry, having most recently served as First Vice President of
Exchange National Bank, a bank with approximately $1 billion in assets before it
was sold. While at Exchange National, Mr. Nadler had responsibility for a $100
million loan portfolio. The holding company for Exchange National also was a
publicly-held company.
If I am elected, I will encourage the Board of Directors to take
measures designed to improve earnings at Community Financial. These measures, if
implemented, hopefully will result in enhanced stockholder value and an increase
in Community Financial's stock price. Although I have no plans to recommend
pursuing an immediate sale of Community Financial, I remain open to considering
a sale as part of a strategy for enhancing stockholder value.
Among the things that trouble me with Community Financial is its
current stock price. When Community Financial's stock was first offered to the
public in 1995, it sold for $10 a share. On January 27, 2000, some 4 1/2 years
later, the last trade was at $9-3/16. Think about it for a moment, a person who
purchased Community Financial stock in the initial public offering in 1995 and
who still is a stockholder today probably would have been better off investing
his or her money in a money market account earning 5% per year rather than
investing in Community Financial stock.
Another thing that troubles me with Community Financial is the amount
of directors fees paid to our directors. Each outside director of Community
Financial has the opportunity to receive at least $9,200 per year in directors
and committee fees, with the Chairman of the Board having the opportunity to
receive at least $15,000 per year. If directors fees are going to be paid, then
we should expect better results from Community Financial. If elected, I will
immediately recommend that directors fees be eliminated or reduced until
Community Financial's stock price has traded at not less than $14 per share for
at least 6 consecutive months and until reasonable earnings goals are met. I
think our directors need an incentive to take appropriate steps to increase our
company's stock price. I would like our directors to establish earnings and
stock price goals each year and not accept directors fees unless those goals are
met.
<PAGE>
Stockholders of Community Financial Corp.
____________, 2000
Page 2
In addition, I am very disappointed with the Management Recognition
Plan of Community Financial. Under the Management Recognition Plan,
approximately 60,000 shares of Community Financial were awarded to directors.
That seems to me to be a lot of stock to be awarded when the stock price of
Community Financial is trading at a price today that is lower than its initial
public offering price of $10 per share and when its returns on equity and assets
are significantly below its peers. The question we stockholders should ask is,
"what is our company recognizing?" It appears to me that instead of rewarding
excellence, the Management Recognition Plan has at best rewarded mediocrity and
should instead have been called the "Mediocre Rewards Plan."
I have two more items to share with you. First, I was disappointed with
the financial performance and stock price of another bank holding company,
Heartland Bancshares, Inc., which was the holding company for Heartland National
Bank in Herrin, Illinois until it sold to Banterra Corp. last year. I owned
almost 8% of the outstanding stock of Heartland Bancshares. I also ran for the
board of directors and solicited proxies in favor of my election. During the two
months before I went on Heartland's board, the stock was trading between about
$9 and $12 per share. Within about a month after I joined the board, the stock
was trading above $14 a share. Now, I'm not suggesting that my going on the
board of Heartland was the sole reason for the increase in the stock price, but
I'd like to think that my appointment to the Board did have a positive effect on
the stock price. Also, shortly after I joined the board at Heartland, it decided
to sell to Banterra Corp. That sale closed in mid-1999 at sale price of $15.75 a
share. While I am not implying here that similar increases in Community
Financial's stock price or that a sale of Community Financial will occur if I am
elected to the Board, I did want you to know what happened at another bank
holding company whose board I recently served on.
Second, I also was disappointed with the financial performance and
stock price of another holding company, CSB Bancorp, which is the holding
company for Centralia Savings Bank in Centralia, Illinois. I own in excess of 3%
of the outstanding stock of CSB, and I asked the board of directors of CSB to
make another individual and me the management's nominees for election as
directors at the 2000 annual meeting of stockholders of CSB. I wanted to go on
the board with goals of trying to increase earnings and enhance stockholder
value at CSB. When CSB did not respond to my request, I filed my proxy materials
with the Securities and Exchange Commission, received the SEC's clearance to
mail my proxy materials and was prepared to mail my proxy statement to CSB's
stockholders. About 2 or 3 days before I was going to mail my proxy materials,
however, CSB announced that it was going to sell to Midland States Bancorp, with
stockholders to receive a cash price of $16 for each share of CSB (incidentally,
I voluntarily determined not to mail my proxy materials after the merger
announcement was made). Before the announcement of its sale, CSB's stock had
traded at a high of about $11 and a low of about $9 during 1999. Again, while I
am not implying here that a sale of Community Financial will occur if I am
elected to the Board or if I solicit proxies in favor of my election and my
stockholder proposal, I did want you to know what happened at another bank
holding company where I was a significant stockholder and where I was actively
considering running a proxy contest in an effort to get elected to the board.
After you have read my proxy statement, please sign the enclosed blue
proxy card and return it to me as soon as possible in the enclosed
self-addressed, postage pre-paid envelope. If you hold your shares through a
broker or a bank, please call the person responsible for your account as soon as
possible and ask him or her to vote the blue proxy card and not to vote the
proxy card you receive from Community Financial.
You also should receive a separate proxy statement and proxy card from
the Board of Directors of Community Financial similar to the way you received
those materials in the past. I encourage you to sign
<PAGE>
Stockholders of Community Financial Corp.
____________, 2000
Page 3
and return only the enclosed blue proxy card and not the proxy card you may
receive from Community Financial. If you do sign, date and return a blue proxy
card to me and if you then later sign and return a proxy card to Community
Financial, only the later proxy will be counted and the blue proxy will not be
voted.
Thank you in advance for your support. If you have any questions at
all, need further assistance or want to discuss my views regarding Community
Financial, please do not hesitate to call me at (800) 529- 3513.
Sincerely,
/s/ Barrett R. Rochman
Barrett R. Rochman
<PAGE>
PROXY STATEMENT
OF
BARRETT R. ROCHMAN
1345 EAST PARK STREET
CARBONDALE, ILLINOIS 62901
(800) 529-3513
Solicitation of Proxies in Opposition to Proxies to be Solicited
by the Board of Directors of Community Financial Corp.
INTRODUCTION
My name is Barrett R. Rochman, and I am a significant stockholder of
Community Financial Corp. ("Community Financial"). I am the third largest
stockholder of Community Financial and own more shares than any member of its
Board of Directors. I beneficially own 128,740 shares, which represents
approximately 5.8% of the outstanding shares of stock of Community Financial. I
am sending this Proxy Statement and the enclosed BLUE PROXY card to the holders
of common stock of Community Financial in connection with my solicitation of
proxies to be voted at the 2000 Annual Meeting of Stockholders of Community
Financial and, if directors are not elected at the next Annual Meeting, then
also at the next meeting of stockholders at which directors are elected, and at
any and all adjournments of those meetings (individually and collectively, the
"Stockholders Meeting"). Although I do not know the time and location of the
next Stockholders Meeting, notice of such meeting will be sent to you by
Community Financial. I am soliciting proxies for use at the Stockholders Meeting
(i) to vote in favor of the election of Michael B. Nadler and me to the Board of
Directors of Community Financial, (ii) to vote in favor of my stockholder
proposal included in this Proxy Statement, (iii) to vote in favor of the
independent auditors of Community Financial recommended by management (if
presented for a vote) and (iv) to vote in my discretion on such other matters
that may properly be presented at the Stockholders Meeting.
I am sending this Proxy Statement to you directly or through Community
Financial's transfer agent on or about February _____, 2000.
You should receive two different proxy statements, each with its own
accompanying form of proxy, in connection with the Stockholders Meeting this
year. You are receiving this Proxy Statement and the enclosed BLUE PROXY card
from me. You also should receive a separate proxy statement and proxy card from
the Board of Directors of Community Financial (which probably will be white),
similar to the way you received these materials in prior years. These two proxy
statements will be very different because both the Board of Directors of
Community Financial and I will be attempting to obtain authority from you to
vote your shares at the Stockholders Meeting in accordance with our respective
recommendations. Even if you plan to attend the Stockholders Meeting, I
encourage you to sign and return only the enclosed BLUE PROXY card and not the
proxy card which you may receive from Community Financial. Any BLUE PROXY card
that you sign and return to me will be voted only in accordance with your
instructions.
Only one proxy of yours will be counted and used at the Stockholders
Meeting. If you sign, date and mail a BLUE PROXY card to me and if you later
sign and return a proxy card to Community Financial, the blue proxy card will
not be counted when the votes are tabulated. I strongly urge you not to return
any proxy card sent to you by the Board of Directors of Community Financial.
<PAGE>
REASONS WHY I AM SOLICITING PROXIES
I decided to seek a position on the Board of Directors in an effort to
encourage the Board to take the following actions:
o to improve the financial performance of Community
Financial;
o to enhance stockholder value at Community Financial;
and
o to reduce directors fees at Community Financial.
I have experience in serving as a director of a publicly-held company,
as I served on the Board of Directors of Heartland Bancshares, Inc., a bank
holding company located in Herrin, Illinois, until it sold to Banterra Corp. in
1999. Mr. Nadler, my other nominee, was a First Vice President of Exchange
National Bank and had responsibility for a $100 million loan portfolio. Exchange
National was a bank with assets of approximately $1 billion before it was sold
and was a subsidiary of a holding company that was a publicly-held company.
As one of the significant stockholders of Community Financial, I am
very interested in the success of our company and in doing what is best for all
Community Financial stockholders. I believe that the current directors are not
operating Community Financial in a manner that is maximizing Community
Financial's financial performance or enhancing the value of Community
Financial's common stock. My belief is supported by the facts: in comparison to
the national averages for bank holding companies, consider for yourself
Community Financial's unfavorable return on stockholder equity, its unfavorable
return on total assets and its dismal stock price. The Board of Directors must
be held accountable for Community Financial's weak performance.
COMMUNITY FINANCIAL'S PERFORMANCE - LOOK AT THE FACTS
For many stockholders of companies, the price at which their stock is
trading is very important. I, for one, am happy when the price of my stock goes
up and am unhappy when the stock price goes down. Well, I am very unhappy with
the current stock price of Community Financial. On January 27, 2000, the last
trade was at $9-3/16.
If you look back a little farther, on May 1, 1998, Community
Financial's stock reached a 4-year high of a $23.50 per share. The price of
$9-3/16 on January 27, 2000 represents a decrease in value of almost 60% when
compared to the 4-year high of $23.50. To put it another way, if you had
invested $1,000 in the common stock of Community Financial at $23.50 a share,
your investment would now be worth about $391 (not including dividends).
Something must be done to increase the stock price of our company.
Let me summarize for you below the high and low stock prices at which
the common stock of Community Financial has traded in the past 5 years. And
remember, when the stock of Community Financial was first sold to the public in
March, 1995, the initial subscription price was $10 per share.
High Low
---- ---
1995 $14.00 $11.25
1996 $13.75 $11.75
1997 $20.25 $12.75
1998 $23.50 $11.00
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<PAGE>
1999 $11.50 $ 7.75
Many observers believe that one test of a company's performance is how
it compares to industry averages. Based upon its most recent reports on Form
10-Q and Form 10-K filed with the Securities and Exchange Commission (the
"SEC"), Community Financial had a return on average stockholders equity of 2.41%
for the quarterly period ended September 30, 1999 and a 3.43% return on average
stockholders equity for the year ended December 31, 1998. Based on statistics
included in the Bank Holding Company Performance Report provided by the Federal
Reserve Bank of St. Louis, the average return on equity for bank holding
companies nationwide with assets greater than $300 million, but less than $500
million, was 12.32% for the quarterly period ended September 30, 1999 and 13.21%
for 1998. So, you can easily see that Community Financial's recent return on
average stockholders equity has been about one-fifth to one-quarter of the
national averages.
In addition, based again upon its most recent reports on Form 10-Q and
10-K filed with the SEC, Community Financial had a return on average assets of
0.26% for the quarterly period ended September 30, 1999 and 0.44% for the year
ended December 31, 1998. Again, based on statistics included in the Bank Holding
Company Performance Report, the average return on assets for bank holding
companies nationwide with assets greater than $300 million, but less than $500
million, was 1.09% for the quarterly period ended September 30,1999 and 1.14%
for 1998. So, you can see that Community Financial's recent return on assets has
been about 25% to 39% of the national averages.
I have summarized these facts in the table below.
Bank holding companies
with greater than $300 but
Community Financial less than $500 million in assets
------------------- --------------------------------
1999 1998 1999 1998
---- ---- ---- ----
Return on Equity 2.41% 3.43% 12.32% 13.21%
Return on Assets 0.26% 0.44% 1.09% 1.14%
Let's face reality and "cut to the chase." In my opinion, Community
Financial's recent financial performance has been relatively poor. To look at it
another way, those of you who bought stock of Community Financial in its initial
public offering in 1995 and who still hold the stock today probably would have
been better off investing your money in a 5% money market account five years ago
instead of investing in Community Financial stock.(1) All the while, Community
Financial has operated and continues to operate, in my opinion, at a sub-par
level.
Now, consider the directors fees that Community Financial continues to
pay its Board members. Each non-employee member of Community Financial's Board
who is also a director of Community Bank & Trust, N.A. ("CB&T"), Community
Financial's largest subsidiary, receives an annual fee of $5,000, except for the
Chairman of the Board of CB&T, who receives an annual fee of $15,000. If that is
not enough, the outside directors (other than the Chairman of the Board) also
receive a fee of $350 for each Board meeting
- --------
(1) Assumes a stock price of $9-3/16 as of January 27, 2000. Based on investing
at Community Financial's IPO price of $10 per share and including dividends,
your investment would be worth almost $10.50 today. That same $10, at a 5%
interest rate, would have been worth $12.50 after five years. Neither value has
been compounded.
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<PAGE>
attended and $100 for each committee meeting attended (that means an additional
$4,200 in fees based on 12 Board meetings per year). Furthermore, certain
directors are provided the opportunity to make as much as $500 per board meeting
attended with respect to the various other subsidiaries of Community Financial.
Here is a summary of these fees based on information from last year's
annual meeting proxy statement.
Person Amount of Fees
------ --------------
Chairman of the Board $15,000 per year.
Other Directors (who are not also $9,200 per year, plus $100 for
employees of Community Financial) each committee meeting of
Community Financial attended.
Wayne H. Benson $4,200 per year, plus $100 for
each committee meeting of
Community Financial attended,
plus up to $500 for each meeting
attended of various Community
Financial subsidiaries.
Shirley B. Kessler $4,200 per year, plus $100 for
each committee meeting of
Community Financial attended,
plus $500 for each meeting
attended of one of Community
Financial's subsidiaries.
If I am elected, I will immediately recommend that the Board of
Directors reduce or eliminate all directors fees. While I believe people should
be paid for serving on Community Financial's Board of Directors, the directors
fees should be tied to Community Financial's performance. Thus, I would like to
see all directors fees eliminated or reduced until Community Financial's stock
price trades above $14 for six consecutive months and until reasonable earnings
goals are met.
To top it all off, directors are eligible to participate in Community
Financial's Management Recognition Plan (the "MRP"). Almost 60,000 shares have
been issued to directors of Community Financial under the MRP. The question we
stockholders should ask is, "what is our company recognizing?" It appears to me
that Community Financial has recognized and applauded poor company performance
resulting from the Board's actions and decisions. Let's face it, in order to
reflect the true performance of these individuals, the MRP should, at best, be
renamed the "Mediocre Results Plan."
If I am elected, I also will immediately recommend that the Board hire
a consultant or other advisor which specializes in financial institutions to
make recommendations to the Board regarding specific measures designed to
improve earnings at Community Financial. I plan to evaluate and recommend
specific alternatives for enhancing stockholder value after I have been elected
to the Board of Directors of Community Financial and have had an opportunity to
review the operations of Community Financial as well as the recommendations of
the consultant. These measures and alternatives, if implemented, hopefully would
result in enhanced stockholder value and an increase in Community Financial's
stock price. Additionally, although I have no plans to recommend or pursue an
immediate sale of Community Financial, I am open to considering a sale of
Community Financial as part of a strategy for enhancing stockholder value.
I believe that I can serve the best interests of the stockholders of
Community Financial, but I need your support to elect Michael Nadler and me to
the Board of Directors.
-4-
<PAGE>
ELECTION OF DIRECTORS OF COMMUNITY FINANCIAL
The Articles of Incorporation of Community Financial that are on file
with the SEC provide that the Board of Directors of Community Financial will
consist of not less than six nor more than eleven directors divided into three
classes as nearly equal in number as possible. The directors of each class are
elected to serve for a term expiring at the third succeeding annual meeting of
stockholders and until their successors have been elected and qualified. One
class is to be elected annually by the stockholders of Community Financial. A
class of two directors should be elected at the Stockholders Meeting for a term
expiring at the annual meeting of stockholders in the year 2003. I am soliciting
proxies to elect Michael Nadler and me to fill this class of directors.
The Articles of Incorporation of Community Financial provide that each
share of common stock is entitled to one vote. The two nominees who receive the
highest number of votes will be elected as directors. I intend to vote only for
Michael Nadler and myself for election as directors whose term will expire in
2003.
Only your latest dated proxy will be counted at the Stockholders
Meeting. If you choose to vote by proxy for Michael Nadler and me by using the
enclosed BLUE PROXY, you may not also use the proxy card provided by Community
Financial to vote for any other nominees. In addition, you CANNOT use the proxy
card provided by the Board of Directors of Community Financial to vote for
either Michael Nadler or me.
I have agreed to serve as a director of Community Financial if elected.
Michael Nadler has informed me that he has agreed to serve as a director of
Community Financial if elected. This is the only agreement or understanding
between Michael Nadler and me. Michael Nadler and I have no agreements or
understandings as to how we will vote or what actions we will propose if elected
as directors. Michael Nadler and I, if elected, will each act in a manner that
we respectively believe will be in the best interests of Community Financial's
stockholders. I believe that immediate action must be taken to improve Community
Financial's financial performance and stock price.
Unless you instruct me otherwise, I will vote the BLUE PROXIES received
by me FOR the election of Michael Nadler and me as directors of Community
Financial.
APPROVAL OF MY PROPOSAL
I also intend to submit the proposal set forth below for consideration
by the stockholders of Community Financial at the upcoming Stockholders Meeting.
Additionally, I intend to submit the following statement in support of my
proposal. Absent instructions to the contrary, the BLUE PROXIES received by me
will be voted FOR my stockholder proposal. The affirmative vote of a majority of
the shares represented at the Stockholders Meeting is required to approve my
proposal.
My Stockholder 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.
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<PAGE>
My Statement in Support of My Proposal
--------------------------------------
I believe that the Board of Directors should hire a consultant
or other advisor which has experience in advising in financial
institutions to assist the Board in taking action designed to improve
earnings and enhance stockholder value at Community Financial's common
stock and to increase the stock price of Community Financial.
Accordingly, I respectfully ask you to vote in favor of my proposed
resolution. Please note, however, that if my resolution is approved by
stockholders, it would recommend that the Board of Directors take
certain action but not mandate any action.
INFORMATION ABOUT
BARRETT R. ROCHMAN AND MICHAEL B. NADLER
The following table shows the number and percentage of the outstanding
shares of common stock of Community Financial owned by my nominees for election
as directors:
Name Number Percentage (1)
---- ------ ----------
Barrett R. Rochman 128,740 5.8%
Michael B. Nadler 6,000 0.3%
(1) Based upon 2,213,645 outstanding shares of common stock of
Community Financial, as disclosed in Community Financial's Form 10-Q for the
quarter ended September 30, 1999.
o Barrett R. Rochman
------------------
My principal occupation is the real estate investment business. My
principal real estate investment activities include owning and renting
commercial and residential real estate and purchasing tax certificates in
Illinois. I have over 30 years of experience as a real estate investor. I am 56
years old and both my office and home are located in Carbondale, Illinois, where
I have lived for the past 35 years. My business address is 1345 East Park
Street, Carbondale, Illinois 62901.
The SEC instituted proceedings against me in 1998 alleging that I
violated Section 13(d) of the Securities Exchange Act of 1934 and certain rules
thereunder (collectively the "Laws"). These proceedings were settled on February
17, 1999 without me having to admit or deny any of the alleged violations. As
part of the settlement, the SEC ordered me to cease and desist from committing
or causing any violation or any future violation of the Laws. The proceedings of
the SEC related to certain reports that I was required to file with the SEC
because I owned more than 5% of the outstanding shares of common stock of
Heartland Bancshares, Inc. I was not required to pay any fine or penalty in
connection with the settlement.
o Michael B. Nadler
-----------------
Mr. Nadler's principal occupation is real estate investment and
consulting. He has over 20 years of experience in the banking industry, having
most recently served as First Vice President of Exchange National Bank, which
was bank with approximately $1 billion in assets before it was sold. While at
Exchange National, Mr. Nadler had responsibility for a $100 million loan
portfolio. The holding company for Exchange National was a publicly-held
company. Mr. Nadler also has served as president and a senior level manager at
CNA Tax Investors, Ltd. and Capital Asset Research Corp., respectively. Mr.
Nadler is 51 years old and both his office and home are located in Riverwoods,
Illinois, which is a suburb of Chicago. He has
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lived in Riverwoods, Illinois for the past six years. Mr. Nadler's business
address is 1919 Thornwood Lane, Riverwoods, Illinois 60015.
-----------------------------------
Neither Michael Nadler nor I nor any of our associates (i) are, or
within the past year have been, a party to any contract, arrangement or
understanding with any person with respect to any securities of Community
Financial, (ii) have, or during the past two years had, a direct or indirect
interest in any transaction or series of similar transactions or in any
currently proposed transaction or series of proposed transactions to which
Community Financial, or any of its subsidiaries, was or is to be a party, (iii)
have any arrangement or understanding with any person or between ourselves with
respect to any future transactions to which Community Financial or any of its
affiliates will or may be a party, or (iv) have any arrangement or understanding
with any person or between ourselves with respect to future employment by
Community Financial or its affiliates. Neither Michael Nadler nor I nor any
companies that we control have had loans outstanding with Community Financial
since the beginning of its last fiscal year.
Neither Michael Nadler nor I have any arrangement or understanding with
any other person or between ourselves according to which either of us will be
nominated as a director of Community Financial. Neither Michael Nadler nor I nor
any of our associates have any interest in the matters to be voted upon at the
Stockholders Meeting other than our interest as stockholders of Community
Financial.
I estimate that my total expenditures relating to my solicitation of
proxies will be approximately $50,000 (including, but not limited to, costs
related to attorneys, printing, transportation and other costs incidental to the
solicitation). My expenditures to date relating to this solicitation have been
approximately $15,000. If elected as a director, I intend to seek reimbursement
of these expenses from Community Financial. I do not know if the Board of
Directors will submit my reimbursement request to a vote of stockholders of
Community Financial.
During the past year, my transactions in shares of Community Financial
common stock have been the following purchases:
Date Number of Shares
---- ----------------
January 7, 1999 1,000 shares
January 8, 1999 800 shares
January 11, 1999 200 shares
February 1, 1999 200 shares
February 9, 1999 2,000 shares
July 1, 1999 8,500 shares
July 2, 1999 7,500 shares
August 25, 1999 5,000 shares
September 1, 1999 4,700 shares
September 8, 1999 2,000 shares
September 23, 1999 6,000 shares
October 5, 1999 6,000 shares
October 19, 1999 4,000 shares
October 20, 1999 3,000 shares
November 2, 1999 6,000 shares
November 4, 1999 5,000 shares
November 30, 1999 2,000 shares
December 27, 1999 600 shares
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<PAGE>
January 3, 2000 10,000 shares
January 5, 2000 2,000 shares
January 5, 2000 2,300 shares
January 6, 2000 2,300 shares
January 6, 2000 2,000 shares
January 6, 2000 1,000 shares
January 6, 2000 1,000 shares
January 7, 2000 1,000 shares
January 10, 2000 1,100 shares
February 1, 2000 12,500 shares
My wife, Marilyn Rochman, whose address also is 1345 East Park Street,
Carbondale, Illinois 62901, directly owns 6,340 shares of common stock of
Community Financial. I disclaim any beneficial interest in the 6,340 shares
owned by Marilyn Rochman.
The Boo Rochman Charitable Corp. and the Rochman Family Investment,
both of which I am administrator, own 20,300 and 2,400 shares of common stock of
Community Financial, respectively. I share the power to vote and dispose of
these shares with my wife.
As of the date of this Proxy Statement, the total amount of funds that
I have used in the purchase of shares of common stock of Community Financial for
myself or on behalf of the Boo Rochman Charitable Corp. or Rochman Family
Investment is approximately $1,156,000. This figure is based on the total number
of shares of common stock of Community Financial that I have purchased, as well
as the total number of shares purchased by the Boo Rochman Charitable Corp. and
Rochman Family Investments, multiplied by the price per share paid and does not
include broker fees associated with such purchases. To date, I have obtained
personal loans in the amount of approximately $500,000 from the First National
Bank & Trust Company, Carbondale, Illinois, and the Boo Rochman Charitable
Corp., Rochman Family Investments and I have used a total of approximately
$656,000 of our respective funds, including funds obtained from broker margin
accounts, for such purchases.
During the past year, Michael Nadler's transactions in shares of
Community Financial common stock have been the following purchases, all of which
were completed using his personal funds totaling approximately $57,000:
Date Number of Shares
---- ----------------
December 30, 1999 2,000 shares
January 10, 2000 2,000 shares
January 12, 2000 2,000 shares
CERTAIN INFORMATION ABOUT COMMUNITY FINANCIAL
Based upon Community Financial's report on Form 10-Q filed with the SEC
for the quarter ended September 30, 1999, there were 2,213,645 shares of common
stock, $.01 par value per share, of Community Financial outstanding as of the
close of business on November 2, 1999. Under Community Financial's Articles of
Incorporation, each share of common stock is entitled to one vote on each matter
to be considered at the Stockholders Meeting. The address of Community
Financial's principal office is 240 East Chestnut, Olney, Illinois 62450-2295.
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DATE, TIME AND PLACE OF THE COMMUNITY FINANCIAL
STOCKHOLDERS MEETING
According to the Bylaws of Community Financial currently on file with
the SEC, the Stockholders Meeting will be held at the main office of Community
Financial at such date and time as the Community Financial Board of Directors
may determine. Notice of the time and location of such Meeting will be sent to
you by Community Financial. I do not yet know the record date for stockholders
entitled to notice of and to vote at the Stockholders Meeting and any
adjournment thereof.
OTHER MATTERS
I will vote your shares of Community Financial common stock represented
by properly executed BLUE PROXIES in the manner which you direct. If no specific
direction is given, I will vote pursuant to the BLUE PROXIES FOR the election of
Michael Nadler and me to the Board of Directors of Community Financial, FOR
approval of my stockholder proposal set forth above and, if presented for a
vote, FOR the ratification or approval of the appointment of the independent
auditors of Community Financial recommended by management. However, I am
assuming that the only matters to be presented at the Stockholders Meeting will
be the election of two directors of Community Financial and my stockholder
proposal. If other matters are properly presented at the Stockholders Meeting,
the BLUE PROXIES will grant me authority to vote such proxies in my discretion
on such matters. Although I do not expect any such matters to be presented, if
they are presented, I intend to vote in accordance with my best judgment on such
matters.
Proxies marked as abstentions, broker non-votes or as withholding
authority to vote for Michael Nadler or me as directors or my stockholder
proposal will be treated as shares present for purposes of determining whether a
quorum for the Stockholders Meeting is present but will not be counted as votes
cast for Michael Nadler or me or my stockholder proposal.
Please refer to Community Financial's proxy statement relating to the
Stockholders Meeting that may be sent to all stockholders with respect to
information concerning (i) beneficial ownership by management of Community
Financial's securities, (ii) beneficial owners of 5% or more of Community
Financial's securities, (iii) committees of Community Financial's Board of
Directors, (iv) meetings of Community Financial's Board of Directors and all
committees thereof, (v) certain information regarding the existing directors as
well as management's nominees to serve as directors of Community Financial, (vi)
compensation and remuneration paid and payable to Community Financial's
directors and management, (vii) the date by which stockholders must submit
proposals to Community Financial for inclusion in Community Financial's next
annual meeting proxy statement, and (viii) other matters required by law to be
disclosed. I have no independent knowledge as to the accuracy or completeness of
the proxy statement that Community Financial's Board of Directors may send to
you in connection with the Stockholders Meeting.
The expense of preparing and mailing this Proxy Statement and my other
soliciting material, as well as my cost of soliciting proxies, will be borne by
me but, if elected, I will seek reimbursement of such costs and expenses from
Community Financial. In addition to the use of the mails, proxies may be
solicited by me, by my employees or agents or by employees or agents of S.I.
Securities who will not be specially compensated for such soliciting, through
the use of telephone, fax, telegram, mail and personal solicitation.
Approximately two employees or agents will be involved in soliciting proxies for
me. I also will request brokerage firms, banks, nominees, custodians and
fiduciaries to forward my solicitation materials to the beneficial owners of
common stock of Community Financial held by such institutions or persons, and I
will reimburse such institutions and persons for their reasonable costs of
forwarding such material.
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Once the Board of Directors has established the agenda for the
Stockholders Meeting and the record date for stockholders of Community Financial
who are eligible to attend and vote at the meeting, I may send additional
information to you regarding the meeting. If you buy or sell shares of Community
Financial common stock between the date of this Proxy Statement and the record
date for the Stockholders Meeting, then you may have to complete and sign a new
BLUE PROXY.
IMPORTANT -- Please sign and date only the enclosed BLUE PROXY and mail
it as soon as possible in the self-addressed, postage-prepaid envelope provided.
When you receive a proxy card from Community Financial relating to the
Stockholders Meeting, please do not sign or return it to Community Financial. If
you do so, it may revoke any proxy that you return to me. If you want to revoke
any proxy you have given to me, you may do so by signing and returning a new
proxy (dated subsequent to any previous proxy), by attending the Stockholders
Meeting and voting in person or by sending me a written letter of revocation of
your proxy at the address shown on page 1 of this Proxy Statement.
* * *
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IMPORTANT
---------
Your vote is important. No matter how many or how few shares you own,
please vote for the election of Michael Nadler and me as Directors of Community
Financial, for my stockholder proposal and for the appointment of the
independent auditors of Community Financial recommended by management (if
presented for a vote) by signing, dating and mailing the enclosed BLUE PROXY as
soon as possible.
Please sign and mail only the enclosed BLUE PROXY if you wish to vote
in accordance with my recommendations. Do not sign any proxy card that you may
receive from the Board of Directors of Community Financial.
You must sign your BLUE PROXY exactly as your name appears on your
stock certificate of Community Financial. If you own your stock jointly, both
owners should sign the BLUE PROXY.
STREET NAME STOCKHOLDERS: If your shares of common stock are held in
the name of your broker, bank or other nominee, you must to contact your broker,
bank or nominee and give them instructions as to the voting of your stock. Your
broker or bank cannot vote your shares without receiving your instructions.
Please contact the person responsible for your account and instruct them to
execute a BLUE PROXY as soon as possible. You should also return your proxy card
to your broker or bank as soon as you receive it.
The proxies that I am soliciting will be valid only at the Stockholders
Meeting. The proxies will not be used for any other meeting and may be revoked
at any time before they are exercised.
If you have any questions or need further assistance, please do not
hesitate to contact me at (800) 529-3513.
The date of this Proxy Statement is February , 2000.
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PROXY PROXY
PROXY SOLICITED ON BEHALF OF BARRETT R. ROCHMAN
FOR USE AT THE 2000 ANNUAL MEETING OF STOCKHOLDERS
OF COMMUNITY FINANCIAL CORP. AND, IF
DIRECTORS ARE NOT ELECTED AT THAT MEETING, AT THE NEXT MEETING OF
STOCKHOLDERS AT WHICH DIRECTORS ARE ELECTED
The undersigned hereby appoints Barrett R. Rochman as proxy, with full
power to appoint his substitute, to represent and to vote, as indicated below,
all shares of common stock of Community Financial Corp. ("Community Financial")
which the undersigned is entitled to vote at the 2000 Annual Meeting of
Stockholders of Community Financial and, if directors are not elected at that
meeting, then also at the next meeting of stockholders at which directors are
elected, and at any and all adjournments thereof (individually and collectively,
the "Stockholders Meeting") upon the following matters:
1. Election of Barrett R. Rochman and Michael B. Nadler as
Directors.
[ ] FOR the election of Barrett R. Rochman
[ ] WITHHOLD authority to vote for Barrett R. Rochman
[ ] FOR the election of Michael B. Nadler
[ ] WITHHOLD authority to vote for Michael B. Nadler
2. Stockholder Proposal of Mr. Rochman.
Approval of Mr. Rochman's proposal with regard to hiring a consultant
or other advisor which specializes in financial institutions to make
recommendations to the Board of Directors regarding actions to be taken to
improve the earnings of Community Financial and to enhance stockholder value.
[ ] FOR [ ] WITHHOLD [ ] ABSTAIN
3. Ratification or Approval of the Appointment of the Independent
Auditors of Community Financial recommended by Management (if
presented for a vote).
[ ] FOR [ ] WITHHOLD [ ] ABSTAIN
4. Other Matters.
In Mr. Rochman's discretion, to vote on such other matters as may
properly be presented at the Stockholders Meeting.
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This Proxy will be voted as directed, but if no direction is indicated,
this Proxy will be voted FOR the election of Barrett R. Rochman and Michael B.
Nadler as directors of Community Financial, FOR the approval of the proposal of
Mr. Rochman with regard to hiring a consultant or other advisor which
specializes in financial institutions to make recommendations to the Board of
Directors regarding actions to be taken to improve earnings and enhance
stockholder value at Community Financial, and FOR the ratification or approval
of the independent auditors of Community Financial recommended by management (if
presented for a vote). With respect to any other matters that may properly be
presented at the Stockholders Meeting, Mr. Rochman intends to vote in accordance
with his best judgment on such matters.
THE UNDERSIGNED HEREBY REVOKES ANY AND ALL PROXIES RELATING TO THE
STOCKHOLDERS MEETING PREVIOUSLY GIVEN BY THE UNDERSIGNED WITH RESPECT TO ALL
SHARES OF COMMON STOCK OF COMMUNITY FINANCIAL OWNED BY THE UNDERSIGNED.
Dated:
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(Signature)
--------------------------------
(Signature, if held jointly)
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(Title, if applicable)
Please sign exactly as your name
appears on the stock records of
Community Financial. If there are
two or more owners, both should
sign this Proxy. When signing as
attorney, executor, administrator,
trustee, guardian or other
representative capacity, please
give full title as such. If owner
is a corporation, please indicate
full corporate name and sign by an
authorized officer. If owner is a
partnership or limited liability
company, please indicate full
partnership or limited liability
company name and sign by an
authorized person.
