SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by Registrant [ x ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ x ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
REDWOOD EMPIRE BANCORP
(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:
REDWOOD EMPIRE BANCORP
111 Santa Rosa Avenue
Santa Rosa, California 95404
Notice of Annual Meeting of Shareholders
May 21, 2002
TO THE SHAREHOLDERS OF REDWOOD EMPIRE BANCORP:
The 2002 Annual Meeting of Shareholders of Redwood Empire Bancorp
("Redwood") will be held at the Hotel La Rose, 308 Wilson Street, Santa Rosa,
California, at 4:00 p.m. on May 21, 2002, for the following purposes:
1. Election of Directors. To elect the following nominees to serve as a
Board of five Directors to serve for the ensuing year: John H.
Brenengen, Dana R. Johnson, Patrick W. Kilkenny, Gregory J. Smith, and
William B. Stevenson.
2. Ratification of Independent Auditors. To ratify the appointment of
Crowe, Chizek and Company LLP ("Crowe Chizek") as independent
certified accountants to audit Redwood's consolidated financial
statements for the fiscal year ending December 31, 2002.
3. Other Business. To consider and act upon such other business as may
properly come before the Annual Meeting or any adjournment thereof.
Only record holders of Common Stock as of the close of business on April
10, 2002 will be entitled to vote at the meeting or any adjournment thereof.
By Order of the Board of Directors
Marta J. Idica
Corporate Secretary
Dated: April 10, 2002
YOU ARE URGED TO VOTE IN FAVOR OF MANAGEMENT'S PROPOSALS BY SIGNING AND
RETURNING THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE, WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING IN PERSON. THE ENCLOSED PROXY IS SOLICITED BY REDWOOD'S BOARD
OF DIRECTORS. ANY SHAREHOLDER GIVING A PROXY MAY REVOKE IT PRIOR TO THE TIME IT
IS VOTED BY NOTIFYING THE SECRETARY OF REDWOOD IN WRITING OF SUCH REVOCATION, BY
FILING A DULY-EXECUTED PROXY BEARING A LATER DATE, OR BY ATTENDING THE ANNUAL
MEETING IN PERSON AND VOTING BY BALLOT.
REDWOOD EMPIRE BANCORP
111 Santa Rosa Avenue
Santa Rosa, California 95404
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
May 21, 2002
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies for use at the 2002 Annual Meeting of Shareholders (the "Annual
Meeting") of Redwood Empire Bancorp ("Redwood" and, including its subsidiaries,
the "Company") to be held at the Hotel La Rose, 308 Wilson Street, Santa Rosa,
California, at 4:00 p.m. on May 21, 2002, and at any and all adjournments
thereof.
It is anticipated that this Proxy Statement and the accompanying Notice and
form of proxy will be mailed to shareholders eligible to receive notice of and
vote at the Annual Meeting on or about April 12, 2002.
Revocability of Proxies
- -----------------------
A form of proxy for voting your shares at the Annual Meeting is enclosed.
Any shareholder who executes and delivers such proxy has the right to, and may,
revoke it at any time before it is exercised by filing with the Secretary of
Redwood an instrument revoking it or a duly executed proxy bearing a later date.
In addition, if the person executing a proxy is present at the Annual Meeting
and elects to vote in person, the powers of the proxy holders will be superseded
as to those proposals on which the shareholder actually votes at the Annual
Meeting.
1
Persons Making the Solicitation
- -------------------------------
This solicitation of proxies is being made by Redwood's Board of Directors.
The expenses of preparing, assembling, printing, and mailing this Proxy
Statement and the materials used in the solicitation of proxies for the Annual
Meeting will be paid by the Company. It is contemplated that proxies will be
solicited principally through the use of the mails and by officers, directors,
and employees of the Redwood and its subsidiary, National Bank of the Redwoods
("NBR"), who may solicit proxies personally or by telephone without receiving
special compensation therefor. The Company will reimburse banks, brokerage
houses and other custodians, nominees, and fiduciaries for their reasonable
expenses in forwarding these proxy materials to shareholders whose stock in
Redwood is held of record by such entities. In addition, the Company may use the
services of individuals or companies it does not regularly employ in connection
with this solicitation of proxies if management determines it to be advisable.
VOTING SECURITIES
There were issued and outstanding [3,485,757] shares of Redwood's common
stock (the "Common Stock") on April 10, 2002, which date has been fixed as the
record date for the purpose of determining shareholders entitled to notice of,
and to vote at, the Annual Meeting (the "Record Date"). A majority of the shares
of Common Stock entitled to vote, present in person or by proxy, constitutes a
quorum.
All properly executed proxies delivered pursuant to this solicitation and
not revoked will be voted at the Annual Meeting in accordance with the
directions given. Regarding the election of directors (Proposal No. 1),
shareholders may vote in favor of all nominees, withhold their votes as to all
nominees, or withhold their votes as to specific nominees by following the
instructions on the enclosed proxy card. With respect to the ratification of
Crowe, Chizek and Company LLP ("Crowe Chizek") to serve as the Company's
independent auditors for the 2002 fiscal year (Proposal No. 2), shareholders may
vote in favor of or against the proposal, or may abstain from voting, by
specifying their choice as indicated on the enclosed proxy card. If no specific
instructions are given with respect to any matter to be voted on, the shares
represented by a signed proxy will be voted FOR the election of the Board's
nominees and FOR the ratification of Crowe Chizek as independent auditors.
Directors will be elected by a plurality of the votes cast by the holders
of Redwood's Common Stock voting in person or by proxy at the Annual Meeting.
Ratification of the appointment of Crowe Chizek as independent auditors will
require the affirmative vote of the holders of a majority of the shares of
Common Stock voting on such appointment in person or by proxy at the Annual
Meeting. Abstentions, although they will be counted in determining whether a
quorum is present, will have the same effect as negative votes. Similarly, while
broker non-votes are counted towards a quorum, they are not counted for
determining whether a matter has been approved and thus have the same effect as
negative votes.
2
On any matter submitted to the vote of the shareholders, other than the
election of directors, each holder of Common Stock will be entitled to one vote,
in person or by proxy, for each share of Common Stock held of record as of the
Record Date. In connection with the election of directors, shares may be voted
cumulatively, but only for persons whose names have been placed in nomination
prior to the voting for the election of directors and only if a shareholder
present at the Annual Meeting gives notice at the Annual Meeting, prior to such
voting, of his or her intention to vote cumulatively. Notice of intention to
vote cumulatively may not be given by simply marking and returning a proxy. If
any Company shareholder gives such notice, then all shareholders eligible to
vote will be entitled to cumulate their votes in voting for the election of
directors. Cumulative voting allows a shareholder to cast a number of votes
equal to the number of shares held in his or her name, as of the Record Date,
multiplied by the number of directors to be elected. All of these votes may be
cast for any one nominee or they may be distributed among as many nominees as
the shareholder thinks fit. The nominees receiving the highest number of votes,
up to the number of directors to be elected, will be elected.
If one of Redwood's shareholders gives notice of intention to vote
cumulatively, the persons holding the proxies solicited by the Board of
Directors will exercise their cumulative voting rights, at their discretion, to
vote the shares they hold in such a way as to ensure the election of as many of
the Board's nominees as they deem possible. This discretion and authority of the
proxy holders may be withheld by checking the box on the proxy card marked
"withhold from all nominees." However, such an instruction will also deny the
proxy holders the authority to vote for any or all of the nominees of the Board
of Directors, even if cumulative voting is not called for at the Annual Meeting.
Checking the box on the proxy card marked "withhold from all nominees" will not
prevent the proxy holders from voting, at their discretion, for any other person
whose name may be properly placed in nomination at the Annual Meeting.
A shareholder may choose to withhold from the proxy holders the authority
to vote for any of the individual candidates nominated by the Board of Directors
by marking the appropriate box on the proxy card and striking out the names of
the disfavored candidates as they appear on the proxy card. In that event, the
proxy holders will not cast any of the shareholder's votes for candidates whose
names have been crossed out, whether or not cumulative voting is called for at
the Annual Meeting, but will retain the authority to vote for the candidates
nominated by the Board of Directors whose names have not been struck out and for
any candidates who may be properly nominated at the Annual Meeting. If a
shareholder wishes to specify the manner in which his or her votes are allocated
in the event of cumulative voting, he or she must appear and vote in person at
the Annual Meeting. Ballots will be available at the Annual Meeting for persons
desiring to vote in person.
All votes will be tabulated by the Company's tabulating agent, Mellon
Investor Services LLC. A representative of Mellon Investor Services LLC will be
in attendance at the Annual Meeting in order to receive any votes cast at that
time.
3
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners
- -----------------------------------------------
Management of the Company knows of no person who beneficially owns,
directly or indirectly, more than five percent of the outstanding shares of
Redwood's Common Stock, except as set forth in the following table. Unless
otherwise indicated, the persons listed have sole voting and investment power
over the shares beneficially owned. Such information is presented as of March
31, 2002.
Amount and Nature of
Name and Address of Beneficial Percent
Beneficial Owner Ownership of Class (7)
---------------- --------- ------------
Mr. B. John Barry 843,501 shares (1) 24.20
1128 Red Mountain Road
Aspen, CO 81611
Banc Fund III L.P., 223,312 shares (2) 6.41
Bank Fund III Trust,
Banc Fund IV L.P. and
Banc Fund V L.P.
208 S. LaSalle Street
Chicago, IL 60604
Dimensional Fund Advisors Inc. 214,350 shares (3) 6.15
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401
Thomas J. Barry 187,500 shares (4) 5.38
2104 Hasting Avenue, Suite 200
Newport, MN 55055-1520
Jessica M. Barry 186,300 shares (5) 5.34
2104 Hasting Avenue, Suite 200
Newport, MN 55055
Michael B. Barry 183,081 shares (6) 5.25
2104 Hasting Avenue, Suite 200
Newport, MN 55055-1520
____________________________
4
(1) Based on information reported by B. John Barry in a Schedule 13D filed with
the Securities and Exchange Commission reflecting ownership data as of
December 21, 1999.
(2) Based on information reported by Banc Fund III L.P. in a Schedule 13G filed
with the Securities and Exchange Commission reflecting ownership data as of
February 13, 2002.
(3) Based on information reported by Dimensional Fund Advisors Inc. in a
Schedule 13G filed with the Securities and Exchange Commission reflecting
ownership data as of January 30, 2002.
(4) Based on information reported by Thomas J. Barry in a Schedule 13G filed
with the Securities and Exchange Commission reflecting ownership data as of
February 14, 2002. Thomas J. Barry is the adult son of B. John Barry.
(5) Based on information reported by Jessica M. Barry in a Schedule 13G filed
with the Securities and Exchange Commission reflecting ownership data as of
February 14, 2002. Jessica M. Barry is the adult daughter of B. John Barry.
(6) Based on information reported by Michael B. Barry in a Schedule 13G filed
with the Securities and Exchange Commission reflecting ownership data as of
February 14, 2002. Michael B. Barry is the adult son of B. John Barry.
(7) Such percentage is calculated by dividing the number of shares listed above
by the Company's total outstanding shares as of March 31, 2002.
5
Security Ownership of Management
- --------------------------------
The following table sets forth, as of March 31, 2002, the number and
percentage of shares of Redwood's outstanding Common Stock which are
beneficially owned, directly or indirectly, by (a) each of Redwood's directors
and nominees for director, (b) the Chief Executive Officer of Redwood and
Redwood's only other executive officer (the "named executive officers"), and (c)
Redwood's directors and the named executive officers as a group. Redwood
identifies as its executive officers the Chief Executive Officer and the Chief
Operating Officer. The number of shares "beneficially owned" is determined under
Securities and Exchange Commission Rules and does not necessarily indicate
ownership for any other purpose. In general, beneficial ownership includes
shares over which the indicated person has sole or shared voting or investment
power and shares that he has the right to acquire within 60 days of March 31,
2002. Unless otherwise indicated, the persons listed have sole voting and
investment power over the shares beneficially owned. Management is not aware of
any arrangements that may, at a subsequent date, result in a change of control
of the Company.
Number of Shares That May
Company Be Acquired
Shares Within 60 Days By
Beneficially Exercise of Percent of
Owned Options Total Class (1)
James E. Beckwith --- 36,750 36,750 1.04
John H. Brenengen --- --- --- ---
Dana R. Johnson 600 4,985 5,585 *
Patrick W. Kilkenny 25,765 70,808 96,573 2.72
Gregory J. Smith 2,400 5,175 7,575 *
William B. Stevenson 750 28,500 29,250 *
Directors, Nominees and
Executive Officers as a
Group (6 persons) 29,515 146,218 175,733 4.84
_____________
* Represents less then one percent of the outstanding shares.
(1) The percentage for each individual (and for the group) is calculated by
dividing (i) the number of Redwood shares beneficially owned (including
shares that could be obtained through the exercise of options within 60
days after March 31, 2002) by (ii) the number of Redwood shares outstanding
on March 31, 2002 plus, in each case, the number of shares which the
individual (or group) could obtain through the exercise of options within
60 days after March 31, 2002.
6
PROPOSAL NO. 1: ELECTION OF DIRECTORS
Nominees
- --------
Redwood's directors are elected annually to serve until the next Annual
Meeting of Shareholders and until their respective successors have been elected.
Redwood's Bylaws provide that the number of directors of Redwood may not be
less than five (5), nor more than nine (9), unless changed by an amendment to
the Bylaws adopted by Redwood's shareholders. The exact number of directors
within that range may be set by the Board of Directors. The Board of Directors
has currently set that number at five.
The persons named below will be nominated for election as directors at the
Annual Meeting to serve until the 2003 Annual Meeting of Shareholders and until
their successors have been duly elected. Unless otherwise instructed, proxy
holders will vote the proxies received by them for the election of the nominees
below (or as many thereof as possible under the rules of cumulative voting). In
the event that any of the nominees should be unable to serve as a director, it
is intended that the proxy will be voted for the election of such substitute
nominee, if any, as shall be designated by the Board of Directors. The Board of
Directors has no reason to believe that any of the nominees named below will be
unable to serve if elected. Additional nominations for director may only be made
by complying with the nomination procedures which are described under the
heading "Shareholder Proposals and Nominations" at the end of this Proxy
Statement.
The following table sets forth the names of, and certain information
concerning, the persons to be nominated by the Board of Directors for election
as directors of Redwood.
7
Year First
Appointed Principal Occupation
Name and Title Age Director During Past Five Years
- -------------- --- -------- ----------------------
John H. Brenengen 60 2001 Retired Senior Bank Executive. Attorney. Appointed as
Director Director of Redwood in October 2001.
Dana R. Johnson 42 1999 President of MidAmerica Capital Partners, LLC, St. Paul,
Director and Minnesota, an asset management firm. Chief Financial Officer
Chairman of Pinnacle Bancorp, Inc., a financial services company, from
of the Board 1995 to 1999. Appointed as Director of Redwood in 1999.
Patrick W. Kilkenny 55 1995 Director, Chief Executive Officer, and President since 1995.
Director, Chief Chairman of the Board of NBR from 1994 to 1997; CEO and
Executive Officer, Director of NBR since 1984. Director of Redwood from 1988 to
and President 1993 and re-appointed in 1995. Re-appointed Chairman of the Board
of NBR in 2000 to present.
Gregory J. Smith 51 1999 Managing Principal of LarsonAllen Financial, LLC, an affiliate
Director of Larson, Allen, Weishair & Co., LLP, Minneapolis, Minnesota,
a professional service firm. President of MidAmerica Capital
Partners, LLC from 1981 to 1999. Appointed as Director of
Redwood in 1999.
William B. Stevenson 71 1995 Principal, Financial Institutions Analysts & Consultants, a
Director financial institution consultancy in the San Francisco area
since 1992. President and CEO, Pan American Savings Bank,
from 1984 to 1991. Director of Redwood and NBR since 1995.
MidAmerica Capital Partners, LLC, of which Mr. Johnson is President,
provides asset management services to Mr. B. John Barry and members of his
family and is controlled by Mr. Barry. Mr. Barry, as of March 31, 2002,
beneficially owned approximately 24.20% of Redwood's outstanding Common Stock.
See "Security Ownership of Certain Beneficial Owners" at page 4 of this Proxy
Statement. Mr. Johnson and Mr. Smith (who was formerly President of MidAmerica
Capital Partners, LLC) each were initially introduced by Mr. Barry in 1999 to
the Board of Directors of Redwood in response to an inquiry from the Chairman of
the Board regarding possible candidates for the Board.
8
No director was selected pursuant to any arrangement or understanding other
than with the directors and officers of Redwood acting within their capacities
as such. There are no family relationships between any of the directors and
executive officers of Redwood. No director or officer of Redwood serves as a
director of any company that has a class of securities registered under, or
which is subject to the periodic reporting requirements of, the Securities
Exchange Act of 1934, as amended, or of any company registered as an investment
company under the Investment Company Act of 1940.
The Board of Directors recommends a vote FOR each of the nominees for
director described above.
PROPOSAL NO. 2: RATIFICATION OF INDEPENDENT AUDITORS
Upon the recommendation of Redwood's Audit Committee, consisting of Richard
I. Colombini, Margie L. Handley, Dana R. Johnson, Mark H. Rodebaugh and William
B. Stevenson, Chairman, the Board of Directors appointed Crowe, Chizek and
Company LLP (Crowe Chizek) as the Company's independent accountants to audit the
consolidated financial statements of Redwood for the 2001 fiscal year.
On September 25, 2000, the Company terminated the appointment of Deloitte &
Touche LLP as the Company's principal accountants. The decision to change
accountants was approved by the Audit Committee of the Redwood's Board of
Directors.
During the Company's two most recent fiscal years ended December 31, 1999
and any subsequent interim period through September 25, 2000, there were no
disagreements with Deloitte & Touche LLP on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or procedure,
which disagreements, if not resolved to their satisfaction, would have caused
them to make reference to the subject matter of the disagreements in connection
with their report.
The audit report of Deloitte & Touche LLP on the Company's consolidated
financial statements, as of and for the years ended December 31, 1999 and 1998,
did not contain an adverse opinion or disclaimer of opinion, nor was it
qualified or modified as to uncertainty, audit scope, or accounting principles.
Crowe Chizek was engaged on September 27, 2000 as the Company's auditors
for the fiscal years ended December 31, 2000 and 2001.
9
Audit Fees
- ----------
The aggregate fees billed by Crowe Chizek for professional services
rendered for the audit of the Company's annual consolidated financial statements
for the fiscal year ended December 31, 2001 and for the reviews of the
consolidated financial statements included in the Company's Quarterly Reports on
Form 10-Q for that fiscal year were $44,415.
Financial Information Systems Design and Implementation Fees
- ------------------------------------------------------------
For the fiscal year ended December 31, 2001, Crowe Chizek did not perform
professional services related to "Financial Information Systems Design and
Implementation."
All Other Fees
- --------------
Crowe Chizek performed professional services related to efficiency and
process improvement. Such fees totaled $81,117 for the fiscal year ended
December 31, 2001.
The Board of Directors recommends a vote FOR Proposal No. 2, ratification
of the appointment of Crowe Chizek as the Company's independent auditors for the
succeeding year. If the appointment is not ratified, Redwood's Board of
Directors will select other independent auditors. A representative of Crowe
Chizek will be present at the Annual Meeting to respond to appropriate questions
from the shareholders and will be given the opportunity to make a statement, if
desired.
Audit Committee Report
- ----------------------
Notwithstanding anything to the contrary set forth in any of Redwood's
previous or future filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate any proxy
statement or future filings with the SEC, in whole or in part, the following
report shall not be deemed incorporated by reference to such filing.
The role of the Audit Committee is to assist the Board of Directors in its
oversight of the Redwood's financial reporting process. The Board of Directors,
in its business judgment, has determined that all members of the Committee are
"independent," as required by applicable listing standards of the Nasdaq
National Market. The Committee operates pursuant to a Charter that was last
amended April 27, 2001 and approved by the Board on May 15, 2001. In addition,
Redwood's Audit Committee is comprised of members of the Board of Directors of
Redwood Empire Bancorp and National Bank of the Redwoods.
10
Management of Redwood is responsible for the presentation and integrity of
the Company's financial statements, the Company's accounting and financial
reporting principles and internal controls and procedures designed to assure
compliance with accounting standards and applicable laws and regulations.
The independent auditors are responsible for auditing the Company's audited
financial statements and expressing an opinion as to their conformity with
generally accepted accounting principles.
In the performance of its oversight function, the Committee has considered
and discussed the audited consolidated financial statements with management and
the independent auditors. The Committee has also discussed with the independent
auditors the matters required to be discussed by Statement on Auditing Standards
No. 61, Communication with Audit Committees, as currently in effect. Finally,
the Committee has received the written disclosures and the letter from the
independent auditors required by Independence Standards Board Standard No. 1,
Independence Discussions with Audit Committees, as currently in effect. As part
of this review, the Committee has considered whether the provision of the
non-audit services by the independent auditors to the Company is compatible with
maintaining the auditor's independence and has discussed with the auditors their
independence.
One or more of the members of the Audit Committee have been professionally
engaged in the practice of auditing or accounting and are experts in the fields
of accounting and auditing, including in respect of auditor independence.
Members of the Committee rely without independent verification on the
information provided to them and on the representations made by management and
the independent accountants. Accordingly, the Audit Committee's oversight does
not provide an independent basis to determine that management has maintained
appropriate accounting and financial reporting principles or appropriate
internal control and procedures designed to assure compliance with accounting
standards and applicable laws and regulations. Furthermore, the Audit
Committee's considerations and discussions referred to above, rely on the
assurance that the audit of Redwood's financial statements has been carried out
in accordance with generally accepted auditing standards, that the financial
statements are presented in accordance with generally accepted accounting
principles, and that Redwood's auditors are in fact "independent." In accordance
with the Audit Committee Charter, the Audit Committee reviews the annual audited
financial statement with management to discuss major issues regarding accounting
and auditing principals and practices, as well as, the adequacy of internal
controls that could significantly affect Redwood's financial statement.
11
Based upon the reports and discussions described in this report, and
subject to the limitations on the role and responsibilities of the Committee
referred to above and in the Charter, the Committee recommended to the Board of
Directors that the audited consolidated financial statements be included in
Redwood's Annual Report on Form 10-K for the year ended December 31, 2001 to be
filed with the Securities and Exchange Commission.
SUBMITTED BY THE AUDIT COMMITTEE
OF REDWOOD'S BOARD OF DIRECTORS
Richard I. Colombini (1)
Margie L. Handley (1)
Dana R. Johnson (2)
William B. Stevenson, Chairman (2)
Mark H. Rodebaugh (1)
(1) Member of National Bank of the Redwoods' Board of Directors.
(2) Member of Redwood Empire Bancorp's Board of Directors and National Bank of
the Redwoods' Board of Directors.
12
OTHER INFORMATION
Performance Graph
- -----------------
Set forth below is a performance graph comparing the yearly cumulative
total shareholder returns on Redwood's Common Stock with the yearly cumulative
total shareholder return on stocks included in the S&P 500 composite index, and
an index of western banking companies published by SNL Securities, L.C.
The total cumulative return on investment for each of the periods indicated
for Redwood, the SNL Western Bank Index, and the S&P 500 is based on the stock
price or composite index at the end of 1996.
[Graph]
13
Committees and Meetings of the Board of Directors
- -------------------------------------------------
The Board of Directors of Redwood held thirteen regular meetings in 2001.
All directors attended 80% or more of the aggregate number of Board meetings and
committee meetings on which each director served, except for Director Cook, who
due to health issues passed away in May 2001.
The Board of Directors of Redwood has the following committees: Audit
Committee, Executive Committee, Nominating Committee, Senior Compensation
Committee, and Stock Option Committee.
Audit Committee. The present members of the Audit Committee are Richard I.
Colombini, Margie L. Handley, Dana R. Johnson, Mark H. Rodebaugh and William B.
Stevenson, Chairman. The Audit Committee met thirteen times during 2001.
Executive Committee. The Executive Committee is comprised of Dana R.
Johnson, Chairman, Patrick W. Kilkenny and Gregory J. Smith. The Executive
Committee met three times in 2001.
Nominating Committee. The Nominating Committee is comprised of Dana R.
Johnson, Chairman, Patrick W. Kilkenny, and Gregory J. Smith. The function of
the Nominating Committee is to recommend candidates for nomination to the Board
of Directors of Redwood. The Nominating Committee met twice in 2001. The
procedures for a shareholder who would like to make a nomination are set forth
under the heading "Shareholder Proposals and Nominations" at the end of this
Proxy Statement.
Stock Option Committee. The Stock Option Committee is comprised of Dana R.
Johnson, Chairman, Gregory J. Smith and William B. Stevenson. The function of
the Stock Option Committee is to recommend employee and director stock option
grants to the Board of Directors of Redwood. The Stock Option Committee met
twice in 2001.
Senior Compensation Committee. The members of the Senior Compensation
Committee include Dana R. Johnson, Chairman, Gregory J. Smith and William B.
Stevenson. The function of the Senior Compensation Committee is to recommend
compensation for executive officers and directors and to monitor the
compensation plan for the entire Company. The Senior Compensation Committee met
two times in 2001.
The Senior Compensation Committee interfaces with the Board of Directors of
Redwood and NBR. The Committee reviews and makes recommendations regarding the
salary and bonus of the Company's Chief Executive Officer to the Board of
Directors. In addition, the committee reviews recommendations from the Chief
Executive Officer for salary levels of other senior staff members.
14
Board Compensation Committee Report on Executive Compensation
- -------------------------------------------------------------
The Senior Compensation Committee of Redwood's Board of Directors provides
compensation recommendations for Redwood's executive officers subject to review
by the full Board of Directors. Compensation decisions relating to the executive
officers of Redwood's subsidiary, NBR, are made by NBR's Board of Directors and
neither the Senior Compensation Committee nor Redwood's Board of Directors
participate in compensation awards to such individuals except to the extent of
stock option awards made pursuant to Redwood's 2001 Stock Option Plan. Option
awards are determined for the executive officers of Redwood and the executive
officers and directors of NBR by Redwood's full Board of Directors. Individual
directors of Redwood have their annual option grants fixed pursuant to the 2001
Stock Option Plan.
Executive Compensation Policy. The goal of the Senior Compensation
Committee is to ensure that executive compensation is appropriate in order to
retain key employees of Redwood and to motivate them to perform at a superior
level for the benefit of shareholders. In order to achieve this goal, Redwood
integrates annual base compensation with bonuses based on Redwood's performance
and the performance and initiative of its individual executive officers. Redwood
attempts to establish base salaries that are generally within the range of
salaries paid to officers holding comparably responsible positions at other peer
group financial institutions in California, taking into account the individual's
past performance and potential contributions. Bonus compensation is based
primarily on the performance of Company and specific individual performance
goals. Measurement of the Company performance is based primarily against the
Company's goals and objectives and the performance of other peer group financial
institutions. Stock options are occasionally granted to officers of Redwood and
NBR on the basis of the recipient's potential for contribution to the Company's
future growth and profitability.
The Senior Compensation Committee links executive compensation to corporate
performance. This is intended to align executive compensation with Redwood's
strategic goals and the interests of shareholders. As performance goals are met
or exceeded, resulting in increased shareholder value, Redwood's executives are
rewarded.
Executive Base Salary. The Senior Compensation Committee reviews Mr.
Kilkenny's and Mr. Beckwith's salary on an annual basis. Factors that are
considered by the Committee include the annual performance review performed by
the Company's Senior Compensation Committee and peer group compensation surveys.
Based on its review of these factors, the Committee believes that Mr. Kilkenny's
and Mr. Beckwith's base salary are well within peer group levels.
15
Bonus Compensation. The Senior Compensation Committee has approved bonus
compensation for Redwood's executive officers for the last three years. As part
of the approval process in 2001, the Senior Compensation Committee made the
recommendation to Redwood's Board of Directors regarding executive bonus. The
purpose of the plan is to motivate each participant to perform in an outstanding
manner and to encourage teamwork at the executive level. The maximum amount an
executive may receive under the plan is determined at the discretion of the
Committee and the Board of Directors. However, in the last three years such
bonuses have not exceeded 40% of salary. In determining the amount of the bonus
compensation, the Committee considers the performance factors of Return on
Equity, Return on Assets, efficiency, and the level of non-performing assets.
SENIOR COMPENSATION COMMITTEE MEMBERS
Dana R. Johnson, Chairman
Gregory J. Smith
William B. Stevenson
Compensation of Directors
- -------------------------
Employee Directors of Redwood and NBR do not receive additional
compensation for their service on the Board of Directors. For all of 2001,
non-employee Directors of Redwood received a fee of $1,000 per Board meeting for
attendance and participation (this fee was conditioned upon 80% annual
attendance). Non-employee NBR Directors received $1,000 per Board meeting for
attendance and participation (this fee was also conditioned upon 80% annual
attendance).
In his position as Chairman of the Board of Directors of Redwood, Mr. Smith
received an additional $500 per month from January 2001 to May 2001. In June of
2001 Mr. Johnson replaced Mr. Smith as Chairman and effective June 2001 the fee
was changed to $1,000 per month. During 2001, Mr. Johnson received a total of
$13,092 for consulting services.
Non-employee Redwood and NBR Directors who were assigned the responsibility
of Committee Chairman received additional compensation in the form of an annual
Chairman's fee. As such, the Audit Committee Chairman received $3,000; NBR Loan
Committee Chairman $2,000; NBR ALCO/Risk Management Committee Chairman $1,500;
NBR Human Resources Chairman $1,500; NBR Internal Asset Review Committee
Chairman $1,500; and NBR Marketing Committee Chairman $1,500. Additionally, each
non-employee Redwood and NBR Director received $250 per each Board committee
meeting attended. Moreover, in 2001, the Company paid $19,627.36 for
transportation and lodging costs of its directors in connection with their
attendance at Board or committee meetings.
16
Executive Officers
- ------------------
The following table sets forth certain information regarding the named
executive officers of Redwood.
Year First
Appointed
Executive Position & Offices with Company and Principal
Name Age Officer Occupation or Employment for Past Five Years
Patrick W. Kilkenny 55 1984 Chief Executive Officer, President and Director of Redwood
since 1995. Chairman of the Board of NBR from 1994 to March
1997; CEO and Director of NBR since 1984; Director of Redwood
from 1988 to 1993. Director and Chief Executive Officer of
Allied Bank, F.S.B. from 1996 to March 1997.
James E. Beckwith 44 1995 Appointed Chief Operating Officer of Redwood and NBR in July
1999. Executive Vice President and Chief Financial Officer
of NBR since March 1997. Executive Vice President and Chief
Financial Officer of Redwood since January 1997. Senior Vice
President and Chief Financial Officer of Redwood and NBR from
January 1995 to March 1997. Chief Financial Officer of
Allied Bank, F.S.B. from January 1995 to October 1996.
Each executive officer of Redwood, subject to the restrictions contained in
the Executive Salary Continuation Agreements and the Executive Severance
Agreements described under the heading "Supplemental Benefit Plans," serves at
the pleasure of the Board of Directors. There are no other understandings or
arrangements between any of such executive officers and any other person
pursuant to which they were or are to be selected as executive officers of
Redwood.
18
Executive Compensation
- ----------------------
The following table sets forth all cash and non-cash compensation
(including bonuses and deferred compensation) paid or accrued to the named
executive officers, as of December 31, 2001, for services rendered to the
Company during the periods indicated below.
SUMMARY COMPENSATION TABLE
Annual Compensation
------------------------------------
Other
Annual All Other
Name and Compensation(1) Compensation (2)
Principal Position Year Salary Bonus
- ---------------------------------------------------------------------------------------------------------
Patrick W. Kilkenny 2001 $233,570 $79,164 $60,835 $4,000
Director, Chief Executive 2000 220,261 70,000 60,118 2,000
Officer, and President of 1999 213,200 30,000 45,319 2,000
Redwood and NBR
James E. Beckwith 2001 199,167 69,882 21,500 4,000
Executive Vice President, 2000 188,422 40,000 18,380 2,000
Chief Financial Officer, and 1999 161,665 25,000 9,071 2,000
Chief Operating Officer of
Redwood and NBR
_______________________________
(1) Includes auto allowances, personal use of company-owned automobiles,
insurance, and changes in the amounts vested under the Company's Salary
Continuation Plan. In 2001 Mr. Kilkenny and Mr. Beckwith received certain
perquisites and other personal benefits totaling more than 10% of their
respective annual salary and bonus. The amount and type of each perquisite
or personal benefit that was greater than 25% of the total received was:
Mr. Kilkenny, amounts vested under the Company's Salary Continuation Plan
of $45,363; and Mr. Beckwith, personal use of company owned auto amounting
to $5,916.
(2) Includes matching contributions to 401(k) plans.
18
The following table sets forth information concerning the aggregate value
of all unexercised options held by each of the named executive officers as of
December 31, 2001.
Aggregated Option Exercises in 2001 and December 31, 2001 Option Values
-----------------------------------------------------------------------
Name Shares Number of Value of Unexercised
and Principal Acquired Unexercised Options at In-the-Money Options at
Position on Exercise (1) December 31, 2001 December 31, 2001 (2)
- ----------------------------------------------------------------------------------------------------------
Exercisable Unexercisable Exercisable Unexercisable
--------------------------------------------------------------
Patrick W. Kilkenny --- 70,808 3,375 $1,205,790 $36,562
Director, Chief Executive
Officer, and President of
Redwood and NBR
James E. Beckwith --- 36,750 2,250 617,183 24,375
Executive Vice President
Chief Financial Officer,
and Chief Operating
Officer of Redwood
and NBR
___________________
(1) No options were exercised in 2001.
(2) All options were issued at the then-current market price on the grant date.
Total value of unexercised options is based on the closing price of
Redwood's Common Stock as reported by the NASDAQ National Market System of
$24.50 as of December 31, 2001 less the exercise price of the option,
multiplied by the number of shares covered by the options outstanding.
Supplemental Benefit Plans
Redwood has adopted an Executive Salary Continuation Policy which acts as a
supplemental benefit plan for executive officers. The Policy authorizes Redwood
and its subsidiaries to enter into individual agreements with selected executive
officers to provide them with certain benefits. The Policy calls for Redwood's
Board of Directors to approve all individual agreements with executive officers
and to conduct a biennial review of all scheduled benefits.
19
As authorized under the Policy, the Company entered into an Executive
Salary Continuation Agreement with Mr. Kilkenny. This agreement provides that
upon retirement, at age 65, the executive will receive for a period of 15 years
after the date of his retirement a specified annual retirement payment payable
in equal monthly installments. The annual retirement benefit payment to which
Mr. Kilkenny would be entitled upon retirement at age 65 is currently $130,823.
In the event that the executive dies after his retirement, but before the end of
the 15-year period, the Company will continue to make such payments to the
executive's designated beneficiary. If the executive should die prior to his
retirement, his designated beneficiary will receive for a period of 15 years a
yearly benefit of $134,058 payable in equal monthly installments. The executive
may take early retirement at age 55 (if by that time he has completed 15 years
of service with the Company), but his annual retirement benefits would only be
about 25% of the amount he would have received if he had retired at age 65. If
he retires between ages 55 and 65, his retirement benefits vest incrementally
pursuant to a specified schedule linked to his years of service. The agreement
provides that if the executive retires or is terminated without cause before age
55, or before he has completed his 15 years of service, he will be entitled to
receive a specified one-time payment. The amount of this payment increases each
year based on a predetermined schedule. As of January 1, 2001, the amount of
this one-time payment for Mr. Kilkenny would be $274,911.
The agreement also provides that in the event of a "change of control," Mr.
Kilkenny, upon notice of such "change of control" from the Company, may elect to
terminate his employment within 90 days of the notice and receive an amount
equal to two times his annual base salary. In addition, if within two years
after the change of control Mr. Kilkenny's employment by the Company is
terminated, his salary or authority is materially reduced, or he is required to
relocate, Mr. Kilkenny is entitled to receive an amount equal to two times his
current annual base salary or his base salary at the time of the "change of
control," whichever is greater. Any amounts paid to Mr. Kilkenny pursuant to the
"change of control" provisions discussed above will be net of the one-time
payment referred to in Mr. Kilkenny's Executive Salary Continuation Agreement.
The agreement defines a "change of control" as: (i) a consummated tender offer
for the ownership of 51% or more of the outstanding voting securities of the
company; (ii) a merger or consolidation with another bank or corporation where
as a result of such merger or consolidation less than 49% of the outstanding
voting securities of the surviving or resulting entity are owned in the
aggregate by the former shareholders of the Company, other than affiliates of
any party to the merger or consolidation, as the same existed immediately prior
to the merger or consolidation; (iii) a sale of substantially all of the
Company's assets to another bank or corporation which is not a wholly owned
subsidiary; or (iv) a person acquiring 51% or more of the outstanding voting
securities of the Company.
The Company and Mr. Kilkenny also executed a five year Executive Severance
Agreement which generally provides that should Mr. Kilkenny be terminated for
any reason other than failure or inability to perform his job duties, habitual
neglect, or illegal conduct, he is entitled to two times his current annual base
salary. Any amounts paid to Mr. Kilkenny pursuant to the "change of control"
provisions discussed above are in lieu of the lump sum payment in the Executive
Severance Agreement. This agreement will expire in November 2004.
20
The Company also entered into an Executive Salary Continuation Agreement
with Mr. Beckwith which provides that in the event of a "change of control," Mr.
Beckwith, upon notice of such "change of control" from the Company, may elect to
terminate his employment within 90 days of the notice and receive an amount
equal to two times annual base salary. In addition, if within two years after
the "change of control" Mr. Beckwith's employment by the Company is terminated,
or his salary or authority is materially reduced, Mr. Beckwith is entitled to
receive an amount equal to two times his current annual base salary or his base
salary at the time of the "change of control," whichever is greater. Mr.
Beckwith's Executive Salary Continuation Agreement defines a "change of control"
as: (i) a consummated tender offer for the ownership of 51% or more of the
outstanding voting securities of the company; (ii) a merger or consolidation
with another bank or corporation where as a result of such merger or
consolidation less than 75% of the outstanding voting securities of the
surviving or resulting entity are owned in the aggregate by the former
shareholders of the Company, other than affiliates of any party to the merger or
consolidation, as the same existed immediately prior to the merger or
consolidation; (iii) a sale of substantially all of the Company's assets to
another bank or corporation which is not a wholly owned subsidiary; or (iv) a
person acquiring 51% or more of the outstanding voting securities of the
Company.
The Company and Mr. Beckwith also executed a five year Executive Severance
Agreement which generally provides that should Mr. Beckwith be terminated for
any reason other than failure or inability to perform his job duties, habitual
neglect, or illegal conduct, he is entitled to two times his current annual base
salary. Any amounts paid to Mr. Beckwith pursuant to the change of "control
provisions" discussed above are in lieu of the lump sum payment under the
Executive Severance Agreement. This agreement will expire in November 2004.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
Redwood's directors, officers, and persons who beneficially own more than 10% of
a registered class of Redwood's equity securities, to file reports of ownership
on a Form 3 and changes of ownership on a Form 4 or Form 5 with the SEC. They
are also required by SEC rules to furnish Redwood with copies of all Section
16(a) forms that they file.
Based solely on its review of the copies of such forms received, or written
representations from certain reporting persons that no Forms 5 were required to
be filed by them, Redwood believes that during 2001 all Section 16(a) filing
requirements applicable to its officers, directors, and ten percent shareholders
were complied with.
21
CERTAIN TRANSACTIONS
During the years ended December 31, 2001, 2000, and 1999, Redwood's
operating subsidiary, National Bank of the Redwoods, paid $35,821, $15,091, and
$130,354 pursuant to various construction contracts in which Colombini
Construction acted as a general contractor. Richard Colombini, who is a director
of the Company, is also the President and majority owner of Colombini
Construction. The amounts paid to Colombini Construction included subcontractor
costs. The construction contracts involved leasehold improvements for one of
NBR's branches and two operation centers.
Some of the Company's directors, executive officers and their immediate
families, as well as the companies with which they are associated, are customers
of or have had banking transactions with Redwood's subsidiaries in the ordinary
course of the Company's business, and the Company expects to have banking
transactions with such persons in the future. In management's opinion, all loans
and commitments to lend included in such transactions were made in compliance
with applicable laws on substantially the same terms, including interest rates
and collateral, as those prevailing for comparable transactions with other
persons of similar creditworthiness and, in the opinion of management, did not
involve more than a normal risk of collectability or present other unfavorable
features. As of December 31, 2001, there were no balances outstanding under
extensions of credit to directors and executive officers of the Company and the
other companies with which such individuals are associated.
SHAREHOLDER PROPOSALS AND NOMINATIONS
Section 3 of Article III of the Bylaws of Redwood sets forth the following
procedures for shareholder nominations of candidates for election to the Board
of Directors:
Nominations for election of members of the Board may be made by the Board
or by any holder of any outstanding class of capital stock of the
Corporation entitled to vote for the election of Directors. Notice of
intention to make any nominations (other than for persons named in the
Notice of any meeting called for the election of Directors) are required to
be made in writing and to be delivered or mailed to the President of the
Corporation by the later of: (i) the close of business 21 days prior to any
meeting of shareholders called for the election of Directors; or (ii) 10
days after the date of mailing of notice of the meeting to shareholders.
Such notification must contain the following information to the extent
known to the notifying shareholder: (a) the name and address of each
proposed nominee; (b) the principal occupation of each proposed nominee;
(c) the number of shares of capital stock of the Corporation owned by each
proposed nominee; (d) the name and residence address of the notifying
shareholder; (e) the number of shares of capital stock of the Corporation
owned by the notifying shareholder; (f) the number of shares of capital
stock of any bank, bank holding company, savings and loan association
22
or other depository institution owned beneficially by the nominee, or by
the notifying shareholder and the identities and locations of any such
institutions; and (g) whether the proposed nominee has ever been convicted
of or pleaded nolo contendere to any criminal offense involving dishonesty
or breach of trust, filed a petition in bankruptcy or been adjudged
bankrupt. The notification shall be signed by the nominating shareholder
and by each nominee, and shall be accompanied by a written consent to be
named as a nominee for election as a Director from each proposed nominee.
Nominations not made in accordance with these procedures shall be
disregarded by the Chairperson of the meeting, and upon his instructions,
the Inspectors of Election shall disregard all votes cast for each such
nominee. The foregoing requirements do not apply to the nomination of a
person to replace a proposed nominee who has become unable to serve as a
Director between the last day for giving notice in accordance with this
paragraph and the date of election of Directors if the procedure called for
in this paragraph was followed with respect to the nomination of the
proposed nominee.
The effect of the foregoing provision is that any shareholder wishing to
nominate one or more candidates for election to the Board of Directors must mail
or deliver to the President of Redwood written notice of an intention to make
such a nomination no later than the close of business on April 24, 2002 or such
nomination will not be considered at the Annual Meeting. To be effective, such
notice must comply with all of the requirements of the Bylaw provision set forth
above. Any notice mailed or delivered to Redwood's President after April 24,
2002, or which is not made in accordance with the procedures specified in the
foregoing Bylaw provision, will be disregarded by the Chairman of the Annual
Meeting and, upon his instructions, the Inspector of Elections for the Annual
Meeting will disregard all votes cast for each such nominee. The Chairman of the
Annual Meeting will decide whether a notice has been properly given and whether
any nomination should be recognized and his or her determination shall be final.
Shareholder Proposals for the 2003 Annual Meeting
- -------------------------------------------------
Shareholders who expect to present a proposal at the 2003 Annual Meeting of
Shareholders for publication in Redwood's Proxy Statement and action on the
proxy form or otherwise for such meeting must submit their proposal by December
15, 2002. The proposal must be mailed to the Corporate Secretary of the Company
at 111 Santa Rosa Avenue, Santa Rosa, CA 95404-4905. If Redwood fails to receive
notice of the proposal by such date, Redwood will not be required to include the
proposal in its proxy statement. In addition to these advance notice
requirements, there are other requirements that a shareholder must meet in order
to have a proposal included in the proxy statement under the rules of the
Securities and Exchange Commission.
23
OTHER MATTERS
The Board of Directors does not know of any other business to be presented
for action at the Annual Meeting other than that set forth in the Notice of
Annual Meeting of Shareholders. However, if other business properly comes before
the meeting, the persons named in the accompanying form of proxy intend to vote
on such matters in accordance with their discretion.
By order of the Board of Directors
Marta J. Idica
Corporate Secretary
Dated: April 10, 2002
The Annual Report to Shareholders for the fiscal year ended December 31,
2001 is being mailed concurrently with this Proxy Statement to all shareholders
of record as of April 10, 2002.
A COPY OF REDWOOD'S MOST RECENT ANNUAL REPORT TO THE SECURITIES AND EXCHANGE
COMMISSION ON FORM 10-K WILL BE PROVIDED TO SHAREHOLDERS WITHOUT CHARGE UPON
WRITTEN REQUEST TO: CORPORATE SECRETARY, REDWOOD EMPIRE BANCORP, 111 SANTA ROSA
AVENUE, SANTA ROSA, CALIFORNIA 95404-4905. YOU MAY ALSO VIEW A COPY ON THE
INTERNET ON THE SEC'S WEBSITE AT WWW.SEC.GOV.
24
REDWOOD EMPIRE BANCORP
ANNUAL MEETING OF SHAREHOLDERS
MAY 21, 2002
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned appoint(s) Dana R. Johnson and William B. Stevenson, and
each of them, as proxies for the undersigned, with full power of substitution
and revocation, to represent and to vote, as designated below, all shares of
Common Stock of Redwood Empire Bancorp (the "Company") that the undersigned
would be entitled to vote, if personally present at the Annual Meeting of
Shareholders of the Company to be held at the Hotel La Rose, 308 Wilson Street,
Santa Rosa, California, at 4:00 P.M. on May 21, 2002, upon the following items
as set forth in the Notice of Annual Meeting and Proxy Statement and according
to their discretion upon all other matters that may be properly presented for
action at the Annual Meeting or at any adjournment thereof. The undersigned may
revoke this proxy at any time prior to its exercise.
This proxy, when properly executed and returned to the Company, will be voted in
the manner directed on this card. In the event that no such direction is given
hereon and this proxy is not subsequently revoked or superseded, the proxy
holders named above intend to vote FOR the election of each of the nominees for
director listed below and FOR each of the other Proposals listed below.
(Continued and to be signed on the reverse side)
The Board of Directors of the Company recommends a vote FOR each of the
Proposals listed on this card.
Please mark you vote as indicated in this example [X]
1. Proposal to elect the following nominees to serve as directors, each to
hold office until the 2003 Annual Meeting of Shareholders or until his
successor has been duly elected and qualified:
Nominees:
01 John H. Brenengen [ ] FOR ALL NOMINEES
02 Dana R. Johnson [ ] WITHHOLD FROM ALL NOMINEES
03 Patrick W. Kilkenny [ ] FOR except vote WITHHELD from those
04 Gregory J.Smith nominees whose names have been struck
05 William B. Stevenson out of the foregoing list.
(Instruction: To withhold authority to vote for any individual nominee, strike a
line through his name listed above.)
2. Proposal to ratify the appointment of Crowe, Chizek and Company LLP as
independent auditors to audit Redwood's consolidated financial statements
for the fiscal year ended December 31, 2002.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
IF ANY SHAREHOLDER GIVES PROPER NOTICE AT THE ANNUAL MEETING OF HIS INTENTION TO
CUMULATE HIS VOTES IN THE ELECTION OF DIRECTORS, THE PROXY HOLDERS WILL HAVE THE
FULL DISCRETION AND AUTHORITY TO VOTE CUMULATIVELY AND TO ALLOCATE VOTES AMONG
ANY OR ALL OF THE NOMINEES OF THE BOARD OF DIRECTORS IN SUCH ORDER AS THEY MAY
DETERMINE UNLESS THE SHAREHOLDER HAS OTHERWISE INDICATED BY MARKING ONE OF THE
BOXES BELOW. SEE THE "VOTING SECURITIES" SECTION OF THE PROXY STATEMENT FOR MORE
INFORMATION.
If you plan to attend the Annual Meeting please mark the
WILL ATTEND box. [ ] WILL ATTEND
WHETHER OR NOT YOU INTEND TO ATTEND THE ANNUAL MEETING, PLEASE SIGN AND
RETURN THIS PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE.
To assure a quorum, you are urged to date, complete, and sign this proxy and
mail it promptly in the enclosed envelope, which requires no additional postage
if mailed in the United States.
Signature __________________ Signature __________________ Date ________________
Please sign exactly as your name(s) appear(s). When signing as attorney,
executor, administrator, trustee, officer, partner, or guardian, please give
full title. If more than one trustee, all should sign.