UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. _____)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
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14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Under Rule 14a-12
Wayne Savings Bancshares, Inc.
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(Name of Registrant as Specified in Its Charter)
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[LOGO]Wayne
Savings
Bancshares, Inc.
June 30, 2005
Dear Stockholder:
You are cordially invited to attend the annual meeting of stockholders of
Wayne Savings Bancshares, Inc. The annual meeting will be held at the Greenbriar
Conference Centre located at 50 Riffel Road, Wooster, Ohio, on Thursday, July
28, 2005 at 10:00 a.m., local time.
At the annual meeting, you will be asked to elect two (2) directors for a
three-year term and ratify the appointment of Grant Thornton LLP as our
independent auditors for the year ending March 31, 2006. Each of these matters
is more fully described in the accompanying materials.
The Board of Directors of Wayne Savings has determined that the matters to
be considered at the annual meeting are in the best interest of Wayne Savings
and our stockholders. For the reasons set forth in the proxy statement, the
Board of Directors unanimously recommends a vote "FOR" each matter to be
considered.
It is very important that you be represented at the annual meeting
regardless of the number of shares you own or whether you are able to attend the
meeting in person. We urge you to mark, sign, and date your proxy card today and
return it in the envelope provided, even if you plan to attend the annual
meeting. This will not prevent you from voting in person at the annual meeting,
but will ensure that your vote is counted if you are unable to attend.
Your continued support of Wayne Savings Bancshares, Inc. is sincerely
appreciated.
Sincerely,
/s/ Charles F. Finn
Charles F. Finn
Chairman, President and Chief Executive Officer
Wayne Savings Bancshares, Inc.
151 North Market Street
Wooster, Ohio 44691
(330) 264-5767
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on July 28, 2005
--------------------
Our 2005 annual meeting of stockholders will be held at the Greenbriar
Conference Centre located at 50 Riffel Road, Wooster, Ohio, on Thursday, July
28, 2005 at 10:00 a.m., local time, for the following purposes, all of which are
more completely set forth in the accompanying Proxy Statement:
(1) To elect two (2) directors for a three-year term, and until their
successors are elected and qualified;
(2) To ratify the appointment of Grant Thornton LLP as our independent
registered public accounting firm for the fiscal year ending March
31, 2006; and
(3) To transact such other business as may properly come before the
meeting or at any adjournment thereof. We are not aware of any other
such business.
Our stockholders of record as of the close of business on June 16, 2005,
the voting record date, are entitled to notice of and to vote at the annual
meeting and at any adjournment of the annual meeting.
By Order of the Board of Directors
/s/ Michael C. Anderson
Michael C. Anderson
Secretary
Wooster, Ohio
June 30, 2005
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You are cordially invited to attend the annual meeting. It is important that
your shares be represented regardless of the number you own. Even if you plan to
be present, you are urged to complete, sign, date and return the enclosed proxy
promptly in the envelope provided. If you attend the meeting, you may vote
either in person or by proxy. Any proxy given may be revoked by you in writing
or in person at any time prior to the exercise of the proxy.
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Table of Contents
Page
----
About the Annual Meeting of Stockholders............................................ 1
Proposal I - Election of Directors and Information with Respect to
Continuing Directors and Executive Officers....................................... 3
Election of Directors.......................................................... 3
Members of the Board of Directors Continuing in Office......................... 4
Executive Officers Who Are Not Directors....................................... 5
Committees and Meetings of the Board of Directors.............................. 6
Directors Attendance at Annual Meetings........................................ 7
Director Nominations........................................................... 7
Director Compensation.......................................................... 7
Compensation Committee Interlocks and Insider Participation.................... 8
Management Compensation............................................................. 8
Summary Compensation Table..................................................... 8
Stock Options.................................................................. 9
Employment Agreements.......................................................... 9
Benefit Plans.................................................................. 10
Indebtedness of Management and Related Party Transactions...................... 11
Report of the Compensation Committee................................................ 12
Report of the Audit Committee....................................................... 13
Performance Graph................................................................... 14
Beneficial Ownership of Common Stock by Certain Beneficial Owners and
Management........................................................................ 15
Section 16(a) Beneficial Ownership Reporting Compliance........................ 17
Proposal II - Ratification of Appointment of Auditors............................... 17
Audit Fees..................................................................... 17
Stockholder Proposals, Nominations and Communications with the Board of Directors... 18
Annual Reports...................................................................... 19
Other Matters....................................................................... 19
PROXY STATEMENT
of
WAYNE SAVINGS BANCSHARES, INC.
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ABOUT THE ANNUAL MEETING OF STOCKHOLDERS
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This Proxy Statement is furnished to holders of common stock of Wayne
Savings Bancshares, Inc., the parent holding company of Wayne Savings Community
Bank. We are soliciting proxies on behalf of our Board of Directors to be used
at the Annual Meeting of Stockholders to be held at the Greenbriar Conference
Centre located at 50 Riffel Road, Wooster, Ohio, on Thursday, July 28, 2005 at
10:00 a.m., local time, and at any adjournment thereof, for the purposes set
forth in the attached Notice of Annual Meeting of Stockholders. This proxy
statement is first being mailed to stockholders on or about June 30, 2005. In
this proxy statement, "Wayne Savings", "we", "us", and "our" refer to Wayne
Savings Bancshares, Inc.
What is the purpose of the annual meeting?
At our annual meeting, stockholders will act upon the matters outlined in
the notice of meeting on the cover page of this proxy statement, including the
election of directors and ratification of our independent registered public
accounting firm. In addition, management will report on the performance of Wayne
Savings and respond to questions from stockholders.
Who is entitled to vote?
Only our stockholders of record as of the close of business on the record
date for the meeting, June 16, 2005, are entitled to vote at the meeting. On the
record date, we had 3,429,244 shares of common stock issued and outstanding and
no other class of equity securities outstanding. For each issued and outstanding
share of common stock you own on the record date, you will be entitled to one
vote on each matter to be voted on at the meeting, in person or by proxy.
In accordance with the provisions of our Certificate of Incorporation,
record holders who beneficially own in excess of 10% of the outstanding shares
of our common stock are not entitled to vote with respect to the shares held in
excess of the 10% limit. Our Certificate of Incorporation authorizes the Board
of Directors (a) to make all determinations necessary to implement and apply the
10% limit, including determining whether persons or entities are acting in
concert, and (b) to demand that any person who is reasonably believed to
beneficially own stock in excess of the 10% limit supply information to us to
enable the Board of Directors to implement and apply the 10% limit.
How do I submit my proxy?
After you have carefully read this proxy statement, indicate on your proxy
form how you want your shares to be voted. Then sign, date and mail your proxy
form in the enclosed prepaid return envelope as soon as possible. This will
enable your shares to be represented and voted at the annual meeting.
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If my shares are held in "street name" by my broker, could my broker
automatically vote my shares for me?
Yes. Your broker may vote in his or her discretion on the election of
directors and ratification of the auditors if you do not furnish instructions.
Can I attend the meeting and vote my shares in person?
Yes. All stockholders are invited to attend the annual meeting.
Stockholders of record can vote in person at the annual meeting. If your shares
are held in street name, then you are not the stockholder of record and you must
ask your broker or other nominee how you can vote at the annual meeting.
Can I change my vote after I return my proxy card?
Yes. If you have not voted through your broker or other nominee, there are
three ways you can change your vote or revoke your proxy after you have sent in
your proxy form.
o First, you may send a written notice to our Secretary, Michael C.
Anderson, Wayne Savings Bancshares, Inc., 151 North Market Street,
Wooster, Ohio 44691, stating that you would like to revoke your
proxy.
o Second, you may complete and submit a new proxy form. Any earlier
proxies will be revoked automatically.
o Third, you may attend the annual meeting and vote in person. Any
earlier proxy will be revoked. However, attending the annual meeting
without voting in person will not revoke your proxy.
If you have instructed a broker or other nominee to vote your shares, you
must follow directions you receive from your broker or other nominee to change
your vote.
What constitutes a quorum?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the shares of common stock outstanding on the record date will
constitute a quorum. Proxies received but marked as abstentions and broker
non-votes will be included in the calculation of the number of votes considered
to be present at the meeting.
What are the Board of Directors' recommendations?
The recommendations of the Board of Directors are set forth under the
description of each proposal in this proxy statement. In summary, the Board of
Directors recommends that you vote FOR the nominees for director described
herein and FOR ratification of the appointment of Grant Thornton LLP for the
fiscal year ending March 31, 2006.
The proxy solicited hereby, if properly signed and returned to us and not
revoked prior to its use, will be voted in accordance with your instructions
contained in the proxy. If no contrary instructions are given, each proxy signed
and received will be voted in the manner recommended by the Board of
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Directors and, upon the transaction of such other business as may properly come
before the meeting, in accordance with the best judgment of the persons
appointed as proxies. Proxies solicited hereby may be exercised only at the
annual meeting and any adjournment of the annual meeting and will not be used
for any other meeting.
What vote is required to approve each item?
The election of directors will be determined by a plurality of the votes
cast at the annual meeting. The two nominees for director receiving the most
"for" votes will be elected. The approval of the proposal to ratify the
appointment of our independent registered public accounting firm and any other
proposal will require the affirmative vote of a majority of the votes cast on
the proposal.
Under the Delaware General Corporation Law, an abstention or broker
non-vote is not counted as a vote cast and, accordingly, will have no effect on
the vote to approve the proposal to ratify the appointment of our independent
registered public accounting firm.
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PROPOSAL I - ELECTION OF DIRECTORS AND INFORMATION WITH RESPECT TO
CONTINUING DIRECTORS AND EXECUTIVE OFFICERS
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Election of Directors
Our Bylaws provide that the Board of Directors shall be divided into three
classes as nearly equal in number as possible. The directors are elected by our
stockholders for staggered terms and until their successors are elected and
qualified.
At this annual meeting, you will be asked to elect one class of directors,
consisting of two directors, for a three-year term expiring in 2008 and until
their respective successors are elected and qualified. Joseph L. Retzler whose
term expires at this annual meeting, will retire after 20 years of service to
Wayne Savings Community Bank. Our Nominating and Corporate Governance Committee
has recommended the nomination of Mr. Daniel R. Buehler to stand for election to
the class of directors whose terms are expiring at this annual meeting. Mr.
Buehler's name was submitted for consideration by the Chief Executive Officer.
In addition, the Nominating and Corporate Governance Committee has recommended
the re-election of Charles F. Finn as director. No nominee for director is
related to any other director or executive officer by blood, marriage or
adoption other than Charles F. Finn, whose spouse is Ms. Wanda Christopher-Finn.
Stockholders are not permitted to use cumulative voting for the election of
directors.
Unless otherwise directed, each proxy executed and returned will be voted
for the election of the nominees for director listed below. If any person named
as a nominee should be unable or unwilling to stand for election at the time of
the annual meeting, the proxies will nominate and vote for any replacement
nominee or nominees recommended by our Board of Directors. At this time, the
Board of Directors knows of no reason why either of the nominees listed below
may not be able to serve as a director if elected.
The following tables present information concerning the nominees for
director and each director whose term continues. No continuing directors are
related to any other director or executive officer by blood, marriage or
adoption. Ages and shares of common stock beneficially owned are reflected as of
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June 16, 2005. Where applicable, service as a director includes service as a
director of Wayne Savings Community Bank.
Nominees for Director for a Three-Year Term Expiring in 2008
Director
Name Age Positions Held with Wayne Savings Since
- --------------------- --------- ------------------------------------ --------
Charles F. Finn 67 Chairman of the Board, President and 1976
Chief Executive Officer
Daniel R. Buehler 50 Director 2005
The Board of Directors recommends that you vote FOR election of the
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nominees for director.
Members of the Board of Directors Continuing in Office
Directors Whose Term Expires in 2006
Director
Name Age Positions Held with Wayne Savings Since
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James C. Morgan 67 Director 1995
Kenneth R. Lehman 46 Director 2003
Directors Whose Term Expires in 2007
Director
Name Age Positions Held with Wayne Savings Since
- --------------------- --------- ------------------------------------ --------
Russell L. Harpster 70 Director 1979
Terry A. Gardner 58 Director 1994
Frederick J. Krum 54 Director 2004
The principal occupation during the past five years of each director of
Wayne Savings is set forth below.
Charles F. Finn. Mr. Finn has served as President and Chief Executive
Officer of Wayne Savings Community Bank since 1984 and has been employed by
Wayne Savings Community Bank for 41 years. Mr. Finn is the spouse of Wanda
Christopher-Finn, Executive Vice President of Wayne Savings. He was appointed
Chairman of the Board of Directors of Wayne Savings Community Bank in July 2003
and has served as Chairman of Wayne Savings since September 25, 1997.
Daniel R. Buehler. Mr. Buehler has served as President of Buehler Food
Markets, Wooster, Ohio since 1990 and has been employed by Buehler Food Markets
for 32 years.
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Russell L. Harpster. Mr. Harpster is an attorney and a partner in the law
firm of Harpster, Vanosdall & Findley, LLP in Ashland, Ohio since January 2005
(formerly named Henderson, Harpster & Vanosdall, LLP).
Terry A. Gardner. Mr. Gardner is Executive Vice President and part owner
of Greenbriar Conference Centre, Wooster, Ohio since January 2001. Previously,
Mr. Gardner was President and general partner of Terra Management and Terra
Developers in Wooster, Ohio, firms involved in the management and construction
of mutli-family housing projects.
Frederick J. Krum. Mr. Krum has served as Director of the Akron-Canton
Airport since 1981. Mr. Krum served on the Board of Directors of Village Savings
Bank, a wholly-owned subsidiary of Wayne Savings Community Bank, from June 1998
until the merger of Village Savings into Wayne Savings Community Bank in
September 2003.
James C. Morgan. Mr. Morgan is President of Franklin Gas & Oil Co., Inc.
in Wooster, Ohio and a partner of Franklin Gas & Oil Co. LLC since 2001.
Kenneth R. Lehman. Mr. Lehman is a private investor and a former corporate
and securities attorney. Mr. Lehman was a founding partner of the Washington,
D.C. law firm of Luse Lehman Gorman Pomerenk & Schick (since renamed Luse Gorman
Pomerenk & Schick). He retired from the law firm in April 2002.
Executive Officers Who Are Not Directors
Set forth below is the information with respect to the principal
occupations during the last five years for the three executive officers of Wayne
Savings who do not also serve as directors. Ages are reflected as of June 16,
2005.
Wanda Christopher-Finn. Age 62 years. Ms. Christopher-Finn is Executive
Vice President of Wayne Savings and Executive Vice President and Chief Operating
Officer of Wayne Savings Community Bank since August 2004. Previously, Ms.
Christopher-Finn served as Executive Vice President of Wayne Savings and
Executive Vice President and Chief Administrative Officer of Wayne Savings
Community Bank and has been affiliated with Wayne Savings Community Bank since
1972. Ms. Christopher-Finn is the spouse of Mr. Charles F. Finn.
Michael C. Anderson. Age 54 years. Mr. Anderson is Executive Vice
President and Chief Financial Officer of Wayne Savings and Wayne Savings
Community Bank and joined Wayne Savings Community Bank in October 2001. He has
most recently been a member of senior management in the health care field
responsible for accounting and financial operations in Madison, Wisconsin. Mr.
Anderson was Senior Vice President, Chief Financial Officer of Wayne Savings
Community Bank between 1984-1986.
Phillip E. Becker. Age 60 years. Mr. Becker has served as Executive Vice
President and Chief Lending Officer of Wayne Savings Community Bank since
January 2005. Mr. Becker was Vice President of Wayne County National Bank,
Wooster, Ohio, from August 1999 to December 2004.
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Committees and Meetings of the Board of Directors
The Board of Directors of Wayne Savings has established an Audit
Committee, Executive Committee, Nominating and Corporate Governance Committee
and Compensation Committee. Members of the Board also serve on committees of
Wayne Savings Community Bank. Wayne Savings has not paid separate compensation
to its executive officers or directors.
During the fiscal year ended March 31, 2005, the Board of Directors of
Wayne Savings met 14 times. No director of Wayne Savings attended fewer than 75%
of the total number of Board of Directors meetings and all committees of the
Board on which such director served during the periods that he served. Our Board
of Directors has determined that a majority of our members are independent
directors as defined in the Nasdaq listing standards. The current independent
members are Messrs. Gardner, Harpster, Krum, Lehman, Morgan and Retzler. Mr.
Buehler will also be deemed independent if elected.
Audit Committee. The Audit Committee reviews with management and the
independent auditors the systems of internal control, reviews the annual
financial statements, including the Form 10-K and monitors Wayne Savings'
adherence in accounting and financial reporting to generally accepted accounting
principles. The Audit Committee is comprised of four directors, all of whom are
independent directors as defined in the Nasdaq's listing standards. The current
members of the Audit Committee are Directors Gardner, Krum, Morgan and Lehman.
Mr. Krum has been designated as our Audit Committee Financial Expert. Mr. Krum
has extensive financial and accounting experience as the managing director of
the Akron-Canton Airport. Mr. Krum served as Chief Financial Officer of the
airport from 1975-1982. The Audit Committee of Wayne Savings met six times in
fiscal 2005. The Audit Committee of Wayne Savings has adopted a charter which
has been amended and was attached as Appendix A to the proxy statement for the
2004 annual meeting of stockholders.
Executive Committee. The Executive Committee is empowered to act in place
of the full Board, with certain exceptions, between meetings of the full Board.
The Executive Committee performs general control and supervision functions
subject to the discretion of the full Board of Directors. The Executive
Committee meets as needed and met once in fiscal 2005. The current members of
the Executive Committee are Messrs. Finn, Harpster and Retzler.
Nominating and Corporate Governance Committee. Wayne Savings established a
Nominating and Corporate Governance Committee in 2004 for the purpose of
nominating directors for election to the Board of Directors. The current members
of the Nominating and Corporate Governance Committee are Directors Lehman, Krum
and Morgan. The Nominating and Corporate Governance Committee met once in 2005
to consider director nominations and recommended nominees to the full Board of
Directors. The Nominating and Corporate Governance Committee members are
independent directors, as defined in the Nasdaq listing standards, who rotate
annually so that no director will be in a position to recommend himself for
nomination to the Board of Directors. The committee's charter, as adopted in
2004 was attached as Appendix B to the proxy statement for the 2004 annual
meeting of stockholders.
Compensation Committee. It is the responsibility of the Compensation
Committee of Wayne Savings to set the compensation of our Chief Executive
Officer, Chief Operating Officer and Chief Financial Officer as well as review
the performance of other officers and to determine and administer compensation
programs and adjustments, including personnel policies and practices. The
Compensation Committee met three times during fiscal 2005. The current members
of the Compensation Committee are
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Messrs. Gardner, Harpster, Lehman, Krum, Morgan and Retzler. Each of the members
is an independent director as defined in the Nasdaq listing standards.
Directors Attendance at Annual Meetings
Directors are expected to attend the annual meeting absent a valid reason
for not doing so. We expect that a Board meeting will typically be scheduled in
conjunction with our annual meetings of stockholders, as is the case for this
annual meeting. In 2004, all of our directors attended the annual meeting of
stockholders.
Director Nominations
In June 2004, the Nominating and Corporate Governance Committee adopted a
written charter. The Charter sets forth certain criteria the committee may
consider when recommending individuals for nomination including: ensuring that
the Board of Directors, as a whole, is diverse and consists of individuals with
various and relevant career experience, relevant technical skills, industry
knowledge and experience, financial expertise (including expertise that could
qualify a director as a "financial expert," as that term is defined by the rules
of the SEC), local or community ties, minimum individual qualifications,
including strength of character, mature judgment, familiarity with our business
and industry, independence of thought and an ability to work collegially. The
committee also may consider the extent to which the candidate would fill a
present need on the Board of Directors. The Nominating and Corporate Governance
Committee will also consider candidates for director suggested by other
directors, as well as our management and stockholders. Any stockholder wishing
to make a nomination must follow our procedures for stockholder nominations,
which are described under "Stockholder Proposals, Nominations and Communications
with the Board of Directors."
Director Compensation
Our directors, who also serve on the Board of Wayne Savings Community
Bank, currently do not receive fees for serving on the Board or committees of
Wayne Savings. Each non-employee director serving on the Board of Wayne Savings
Community Bank received a fee of $900 per month and $600 for each monthly board
meeting attended or for which they have an excused absence which totaled $18,000
for fiscal 2005. No fees are paid for special meetings of the Board, nor does
Mr. Finn receive compensation for service on the Board. During fiscal 2005,
members of the Executive Committee and Audit Committee received fees of $166.67
and $150.00 per month, respectively, regardless of attendance.
2003 Stock Option Plan and 2003 Recognition Plan. The Board of Directors
of Wayne Savings adopted the 2003 Stock Option Plan and 2003 Recognition Plan on
May 22, 2003. The plans were approved by our stockholders at the 2003 annual
meeting. Certain amendments to the plans were approved by our stockholders at
the 2004 annual meeting to, among other things, change certain terms regarding
vesting and acceleration of awards. We granted to each of Messrs. Harpster,
Retzler, Morgan, Gardner and Lehman non-statutory options to purchase 10,204
shares of common stock at an exercise price of $13.95 per share, the fair market
value of the shares of common stock underlying such option on the date the
option was granted. Such options vest at a rate of 20% per year commencing one
year from the date of grant. Pursuant to the 2003 Recognition Plan, we granted
to each of Messrs. Harpster, Retzler, Morgan, Gardner and Lehman 4,081 shares of
restricted stock that vest at a rate of 20% per year from the date of grant.
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Compensation Committee Interlocks and Insider Participation
Determinations regarding compensation of our President and Chief Executive
Officer, our Executive Vice President and Chief Operating Officer and our
Executive Vice President and Chief Financial Officer is reviewed by Wayne
Savings' Compensation Committee. Messrs. Gardner, Lehman, Krum, Morgan, Retzler
and Harpster who is the Committee's lead director, serve as members of the
Compensation Committee.
No person who served as a member of the Compensation Committee during
fiscal 2005 was a current or former officer or employee of Wayne Savings or
Wayne Savings Community Bank or engaged in certain transactions with Wayne
Savings or Wayne Savings Community Bank required to be disclosed by regulations
of the SEC. Additionally, there were no compensation committee "interlocks"
during fiscal 2005, which generally means that no executive officer of Wayne
Savings served as a director or member of the compensation committee of another
entity, one of whose executive officers served as a director or member of the
Compensation Committee.
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MANAGEMENT COMPENSATION
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Summary Compensation Table
The following table sets forth a summary of certain information concerning
the compensation paid by Wayne Savings (including amounts deferred to future
periods by the officers) for services rendered in all capacities during the
years ended March 31, 2005, 2004 and 2003, to the President and Chief Executive
Officer and other executive officers of Wayne Savings whose salary plus bonus
exceeded $100,000 in fiscal 2005.
Long- Term Compensation
------------------------------
Awards
Annual ------------------------------
Compensation(1) Restricted Securities
--------------------- Stock Underlying All Other
Name and Principal Position Year Salary Bonus Awards (2)(3) Options Compensation
- ------------------------------------- ------- ---------- ---------- --------------- -------------- -----------------
Charles F. Finn 2005 $179,200 $23,000 $ -- -- $34,853(4)
Chairman, President and Chief 2004 170,200 20,000 289,793 23,857 22,829
Executive Officer 2003 165,400 20,000 -- -- 3,280
Wanda Christopher-Finn 2005 126,100 20,000 -- -- 26,250(4)
Executive Vice President and 2004 118,600 18,000 260,839 20,000 20,191
Chief Operating Officer 2003 106,600 18,000 -- -- 2,081
Michael C. Anderson 2005 123,700 20,000 -- -- 25,991(4)
Executive Vice President and 2004 116,200 18,000 260,839 20,000 20,614
Chief Financial Officer 2003 104,200 18,000 -- -- --
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(1) Wayne Savings provides various miscellaneous benefits to the named
executive officers. The costs of providing such benefits did not exceed
the lesser of $50,000 or 10% of the total annual salary and bonus reported
for each of such individuals.
(2) Reflects the value of shares of restricted stock on the date of grant
awarded pursuant to the 2003 Recognition Plan. Such restricted stock vests
over five years, 20% per year from the date of the grant.
(Footnotes continued on following page)
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- ---------------------
(3) As of March 31, 2005, Mr. Finn, Ms. Christopher-Finn and Mr. Anderson had
16,326, 14,692 and 14,692 shares of unearned restricted stock,
respectively, pursuant to the 2003 Recognition Plan, which had fair market
values of $261,216, $235,072 and $235,072 at March 31, 2005.
(4) Reflects compensation received in lieu of dividends paid on unearned
restricted common stock, amounts contributed to the 401(k) accounts of the
named executive officers and the dollar value of 1,022.54, 737.38 and
747.047 shares allocated to the employee stock ownership plan accounts of
Mr. Finn, Ms. Christopher- Finn and Mr. Anderson, respectively, at
December 31, 2004, the date of allocation.
Stock Options
Fiscal Year-End Option Values
The following table sets forth, with respect to the executive officers
named in the Summary Compensation Table, information with respect to the number
of options held at the end of the fiscal year ended March 31, 2005 and the value
with respect thereto.
Number of Securities Value of Unexercised
Underlying Unexercised Options in the Money Options
at Fiscal Year End at Fiscal Year End(1)
------------------------------- --------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---------------------- ------------- ------------- ------------- -------------
Charles F. Finn 23,857 -- $58,450 --
Wanda Christopher-Finn 20,000 -- 49,000 --
Michael C. Anderson 27,556 -- 83,909 --
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(1) Calculated by determining the difference between the fair market value of
a share of the common stock underlying the options at March 31, 2005
($16.00) and the exercise price of the options.
(2) Effective for fiscal 2005, the Board of Directors of Wayne Savings
approved the accelerated vesting of all granted and unexercisable options.
Employment Agreements
Wayne Savings Community Bank entered into employment agreements with
Chairman, President and Chief Executive Officer, Charles F. Finn, and Executive
Vice Presidents Wanda Christopher-Finn and Michael C. Anderson effective April
1, 2004, at their then current base salaries. Mr. Finn's agreement provides for
a term of 36 months, and Ms. Christopher-Finn's and Mr. Anderson's provide for
terms of 24 months. On each anniversary date, the agreements may be extended for
an additional 12 months, so that the remaining term shall be 36 months and 24
months, respectively. If an agreement is not renewed, the agreement will expire
36 months, or 24 months, respectively, following the anniversary date. The base
salaries under the agreements shall be reviewed at least annually and may be
increased but not decreased. In addition to the base salaries, the agreements
provide for, among other things, insurance benefits and participation in other
employee and fringe benefits applicable to executive personnel. The agreements
provide for termination of the employment of the executive by Wayne Savings
Community Bank for cause at any time.
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The employment agreements provide for certain payments to the executives
in the event Wayne Savings Community Bank terminates the executive's employment
during the term of the agreement for reasons other than cause, retirement or
disability, each as defined in the agreements, or in the event of the
executive's resignation upon (a) failure to re-elect the executive to his or her
current offices, (b) a material change in the executive's functions, duties or
responsibilities, (c) relocation of his or her principal place of employment by
more than a specified number of miles, (d) liquidation or dissolution of Wayne
Savings Community Bank or Wayne Savings, or (e) a breach of the agreement by
Wayne Savings Community Bank or in the event of the termination or resignation
of the executive following our change in control, as defined. In the above
circumstances, the executive, or in the event of death, his or her beneficiary,
would be entitled to severance pay in an amount equal to three times, or two
times, as applicable, his or her highest annual base salary and bonus. Wayne
Savings Community Bank would also continue the executive's life and, if
applicable, dental coverage for the remaining unexpired term of the agreement.
In the event the payments to the executive include an "excess parachute payment"
as defined in the Internal Revenue Code, the payments will be reduced in order
to avoid having an excess parachute payment.
Upon termination of the executive's employment upon the executive's
retirement, he or she will be entitled to all benefits available to him or her
under any retirement or other benefit plan maintained by Wayne Savings Community
Bank. In the event of an executive's disability for a period of six months,
Wayne Savings Community Bank may terminate the agreement, provided that Wayne
Savings Community Bank will be obligated to pay the executive a bi-weekly
payment equal to three quarters of the executive's bi-weekly rate of base
salary, reduced by any benefits paid to the executive pursuant to any disability
insurance policy or similar arrangement maintained by Wayne Savings Community
Bank. The disability payments shall end on the earlier of (i) the date the
executive returns to full-time employment with Wayne Savings Community Bank or
another employer, (ii) his or her attainment of retirement age, or (iii) his or
her death.
In the event of a change in control of Wayne Savings or Wayne Savings
Community Bank, as defined, the total payment that would be due under the
employment agreements of Mr. Finn, Ms. Christopher-Finn and Mr. Anderson based
solely on the current annual compensation paid to such officers and excluding
any payments or benefits under any employee benefit plan which may be payable,
would be approximately $1.2 million. Such payments may tend to discourage
takeover attempts by increasing the costs to be incurred in the event of a
takeover.
Benefit Plans
Retirement Plan. Wayne Savings Community Bank maintains a defined benefit
pension plan for eligible employees. We froze the pension plan as of December
31, 2003. Subsequent to December 31, 2003, there have been no new enrollments
and no further benefit accruals in the pension plan. Credited service ceased to
accrue after December 31, 2003, however, vesting continues for periods of
employment subsequent to such date. The pension plan provides for monthly
payments to or on behalf of each covered employee upon the employee's normal
retirement date (i.e., the first day of the month coincident with or next
following the later of age 65 or five years of participation). These payments
are calculated in accordance with a formula based on the employee's "average
monthly compensation," which is defined as the highest average of total
compensation for five consecutive calendar years of employment. The normal
retirement benefit is equal to 29% of the "average monthly compensation" up to
the integration level, plus 51% of the "average monthly compensation" in excess
of the integration level, reduced for less than 35 years of service. The normal
form of benefit is a monthly income payable for life. Optional forms of benefit
are available.
-10-
Under the pension plan, we make an annual contribution for the benefit of
eligible employees computed on an actuarial basis. Employee benefits under the
plan vest as designated in the schedule below:
Completed Years of Employment Vested Percentages
- ----------------------------- ------------------
Fewer than 3 --
3 but fewer than 4 20%
4 but fewer than 5 40%
5 but fewer than 6 60%
6 but fewer than 7 80%
7 or more 100%
The following table sets forth the estimated annual benefits payable upon
retirement at age 65 for the period ended March 31, 2005.
Years of Benefit Service
Final Average -----------------------------------------------------------
Earnings 10 15 20 25 30 35 40
- -------------- ------ ------ ------ ------ ------ ------ ------
$ 50,000 6,046 9,069 12,092 15,115 18,138 21,161 21,161
75,000 9,689 14,533 19,378 24,222 29,067 33,911 33,911
100,000 13,332 19,998 26,664 33,329 39,995 46,661 46,661
125,000 16,975 25,462 33,949 42,437 50,924 59,411 59,411
150,000 20,617 30,926 41,235 51,544 61,852 72,161 72,161
175,000 23,532 35,298 47,064 58,829 70,595 82,361 82,361
200,000 24,989 37,483 49,978 62,472 74,967 87,461 87,461
225,000 24,989 37,483 49,978 62,472 74,967 87,461 87,461
250,000(1) 24,989 37,483 49,978 62,472 74,967 87,461 87,461
- ---------------------
(1) The maximum amount of annual compensation which the retirement plan can
consider in computing benefits is $205,000 in 2005, as adjusted for
subsequent years pursuant to the Internal Revenue Code provisions.
The approximate full years of credited service, as of March 31, 2005, for
the named executive officers are as follows:
Years of
Name Service
- ---------------------- --------
Charles F. Finn 41
Wanda Christopher-Finn 32
Michael C. Anderson 3
Indebtedness of Management and Related Party Transactions
In accordance with applicable federal laws and regulations, Wayne Savings
Community Bank makes loans to its directors, officers and employees as well as
members of their immediate families for the financing of their primary
residences and certain other loans. These loans are generally made on
substantially the same terms as those prevailing at the time for comparable
transactions with non-affiliated persons. In accordance with a loan policy
applicable to all employees of Wayne Savings Community Bank, officers and
directors have loans with a rate of interest 1/2% below rates for non-
affiliates. According to a policy adopted by Wayne Savings, all loans made to a
director or executive officer in excess of the greater of $25,000 or 5% of Wayne
Savings' capital and surplus, must be approved in advance by a majority of the
disinterested members of our Board of Directors. As of June 16, 2005,
-11-
loans to officers, directors and their related business interests totaled $2.9
million, including a $2.4 million loan and $200,000 line of credit to a
partnership in which one of the directors is a partner. It is the belief of
management that these loans neither involve more than the normal risk of
collectibility nor present other unfavorable features. All loans were current as
of March 31, 2005.
Director Russell L. Harpster is a partner in the law firm of Harpster,
Vanosdall & Findley, LLP of Ashland, Ohio, (formerly named Henderson, Massaro
and Vanosdall, LLP) and has represented Wayne Savings Community Bank in certain
legal matters since 1979, including drafting legal documents, bankruptcies and
foreclosures. During the fiscal year ended March 31, 2005, Wayne Savings paid
$23,804 in legal fees to Mr. Harpster's law firm. No retainer was paid, and
Wayne Savings was billed for services performed at the firm's hourly rates. The
fees for use of Greenbriar Conference Centre, of which Mr. Gardner is a part
owner, for Wayne Savings' annual meeting are standard fees and will not exceed
$1,000.
- --------------------------------------------------------------------------------
REPORT OF THE COMPENSATION COMMITTEE
- --------------------------------------------------------------------------------
The Compensation Committee annually reviews the performance of the Chief
Executive Officer and other executive officers and approves changes to base
compensation as well as the level of bonus, if any, to be awarded. In
determining whether the employment agreements of the Chief Executive Officer and
other executive officers should be extended, the Committee took into account the
individual performance of each executive officer and the performance of Wayne
Savings under the direction of the executive officers. Other factors considered
by the Committee in fiscal 2005 included each executive officer's general
managerial oversight of Wayne Savings, the quality of communications with the
Board of Directors, and Wayne Savings' record of compliance with regulatory
requirements.
While the Committee does not use strict numerical formulas to determine
changes in compensation for the Chief Executive Officer and other executive
officers, and while it weighs a variety of different factors in its
deliberations, it has emphasized and expects to continue to emphasize Wayne
Savings' level of net operating income, net interest margin, non-performing
assets and operating expenses, as well as the experience, expertise and
management skills of the executive officers and their specific roles in the
future success of Wayne Savings. The Committee also considers compensation
surveys prepared by banking associations and professional firms to determine
compensation paid to executives performing similar duties for similarly-sized
financial institutions. Specifically, in fiscal 2005, the Committee examined and
evaluated compensation data for each executive position at similarly-sized
financial institutions, as set forth in the 2004 SNL Compensation Survey. The
Committee also weighed fiscal 2005 earnings, which represented earnings
substantially in line with record earnings in 2004. While each of the
quantitative and non-quantitative factors described above was considered by the
Committee, such factors were not assigned a specific weight in evaluating the
performance of the Chief Executive Officer and other executive officers. Rather,
all factors were considered.
-12-
In 2005, the Committee, after taking into account the foregoing
quantitative and qualitative criteria and other factors, established the base
compensation and bonus payments for the executive officers. With respect to
Charles F. Finn, the President and Chief Executive Officer, the Committee
recommended to the full Board of Directors a $9,000 or 5.3%, increase in base
salary to $179,200. Mr. Finn's annual bonus was increased to $23,000. Mr. Finn
did not participate in the Committee's discussions of his individual base salary
and bonus.
Members of the Compensation Committee
Terry A. Gardner
Joseph L. Retzler
Russell L. Harpster
Kenneth R. Lehman
James C. Morgan
- --------------------------------------------------------------------------------
REPORT OF THE AUDIT COMMITTEE
- --------------------------------------------------------------------------------
The functions of the Wayne Savings Audit Committee include the following:
performing all duties assigned by the Board of Directors; selecting our
independent auditors; reviewing with Wayne Savings' management and our
independent public accountants the financial statements issued by Wayne Savings
and Wayne Savings Community Bank pursuant to federal regulatory requirements;
meeting with the independent public accountants to review the scope of audit
services, significant accounting changes and audit conclusions regarding
significant accounting estimates; assessments as to the adequacy of internal
controls and the resolution of any significant deficiencies or material control
weaknesses; and assessing compliance with laws and regulations and overseeing
the internal audit function.
The Audit Committee has reviewed and discussed Wayne Savings' audited
financial statements with management. The Audit Committee has discussed with
Wayne Savings' independent auditors, Grant Thornton LLP, the matters required to
be discussed by Statement on Auditing Standards No. 61, "Communication with
Audit Committees." The Audit 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" and has
discussed with Grant Thornton LLP, the independent auditors' independence. Based
on the review and discussions referred to above in this report, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in Wayne Savings' Annual Report on Form 10-K for fiscal
year 2005 for filing with the Securities and Exchange Commission.
Members of the Audit Committee
Terry A. Gardner
Frederick J. Krum
James C. Morgan
Kenneth R. Lehman
-13-
- --------------------------------------------------------------------------------
PERFORMANCE GRAPH
- --------------------------------------------------------------------------------
The following graph represents $100 invested in our common stock at the
per share closing price of the common stock on the Nasdaq National Market on
March 31, 2000. The cumulative total returns include the payment of dividends by
Wayne Savings. The graph demonstrates comparison of the cumulative total returns
for the common stock of Wayne Savings, the Nasdaq Composite Index and the SNL
Securities All Bank & Thrift Index for the periods indicated. Although the prior
year's proxy statement referred to the "NASDAQ - US" index, the "Nasdaq
Composite" index is calculated in the same manner; however, the name was changed
to better reflect how the index is generally referred to.
[GRAPH OMITTED]
Period Ending
-----------------------------------------------------
Index 03/31/00 03/31/01 03/31/02 03/31/03 03/31/04 03/31/05
- ------------------------------ -------- -------- -------- -------- -------- --------
Wayne Savings Bancshares, Inc. $100.00 $120.90 $133.90 $124.04 $187.28 $188.16
NASDAQ Composite 100.00 40.33 40.57 29.63 44.26 44.62
SNL All Bank & Thrift Index 100.00 115.02 127.99 110.12 159.71 161.08
- --------------------
* Source: SNL Financial LC, Charlottesville, VA
-14-
- --------------------------------------------------------------------------------
BENEFICIAL OWNERSHIP OF COMMON STOCK
BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
- --------------------------------------------------------------------------------
The following table sets forth as of June 16, 2005, the voting record
date, certain information as to the common stock beneficially owned by each
person or entity, including any "group" as that term is used in Section 13(d)(3)
of the Securities Exchange Act of 1934, who or which was known to us to be the
beneficial owner of more than 5% of the issued and outstanding common stock, the
directors and director nominees of Wayne Savings, the executive officers named
in the Summary Compensation Table, and all directors and certain executive
officers of Wayne Savings as a group.
Amount and Nature
Name of Beneficial of Beneficial
Owner or Number of Ownership as of Percent of
Persons in Group June 16, 2005(1) Common Stock
- -------------------------------------------------------- ----------------- ------------
Wayne Savings Employee Stock Ownership Plan 242,784(2) 6.9%
151 North Market Street
Wooster, Ohio 44691
Directors:
Charles F. Finn 177,811(3)(11) 5.0%
Dan Buehler -- *
Terry A. Gardner 48,075(4) 1.4%
Russell L. Harpster 73,377(5)(11) 2.1%
Frederick J. Krum 300 *
Kenneth R. Lehman 86,902(6)(11) 2.5%
James C. Morgan 34,172(7)(11) 1.0%
Joseph L. Retzler 38,976(8)(11) 1.1%
Executive Officers:
Wanda Christopher-Finn 177,811(9)(11) 5.0%
Michael C. Anderson 8,869(10) *
Phillip E. Becker -- *
All directors and executive officers of Wayne Savings as 468,482(12) 13.0%
a group (11 persons)
- ---------------------
* Represents less than 1% of our outstanding common stock.
(1) Based upon filings made pursuant to the Securities Exchange Act of 1934
and information furnished by the respective individuals. Under regulations
promulgated pursuant to the Securities Exchange Act of 1934, shares of
common stock are deemed to be beneficially owned by a person if he or she
directly or indirectly has or shares (i) voting power, which includes the
power to vote or to direct the voting of the shares, or (ii) investment
power, which includes the power to dispose or to direct the disposition of
the shares. Unless otherwise indicated, the named beneficial owner has
sole voting and dispositive power with respect to the shares.
(2) The Wayne Savings Community Bank Employee Stock Ownership Plan Trust was
established pursuant to the Wayne Savings Community Bank Employee Stock
Ownership Plan ("ESOP") by an agreement between Wayne Savings Community
Bank and Messrs. Anderson and Finn who act as Trustees of the ESOP.
(Footnotes continued on following page)
-15-
- ---------------------
As of December 31, 2004, 109,859 shares held in the ESOP Trust had been
allocated to the accounts of participating employees. Under the terms of
the ESOP, the Trustees must vote all allocated shares held in the ESOP in
accordance with the instructions of the participating employees and
unallocated shares will be voted in the same ratio on any matter as to
those shares for which instructions are given. The amount of common stock
beneficially owned by directors who serve as Trustees of the ESOP and by
all directors and executive officers as a group does not include the
shares held by the ESOP Trust.
(3) Includes 75,312 shares held by Mr. Finn's spouse, Ms. Wanda
Christopher-Finn, Executive Vice President of Wayne Savings, 3,895 shares
allocated to Mr. Finn's account in the Wayne Savings 401(k) Retirement
Plan, 9,823 shares held in Mr. Finn's individual retirement account and
12,513 shares held in Mr. Finn's account in the Wayne Savings employee
stock ownership plan. Mr. Finn's address is c/o Wayne Savings Community
Bank, 151 North Market Street, Wooster, Ohio 44691.
(4) Includes 32,349 shares held jointly with Mr. Gardner's spouse, 5,242
shares held by Mr. Gardner's spouse and 5,242 shares held by Mr. Gardner's
daughter.
(5) Includes 26,646 shares held by Mr. Harpster's spouse.
(6) Includes 76,698 shares held jointly with Mr. Lehman's spouse
(7) Includes 647 shares held by Mr. Morgan's spouse, 2,445 shares held in Mr.
Morgan's individual retirement account, 19,334 shares held in two trusts
for which Mr. Morgan is a beneficiary and 1,542 shares held by Franklin
Gas & Oil Co. LLC of which Mr. Morgan is a partner.
(8) Includes 28,497 shares held in trust for which Mr. Retzler is the trustee.
(9) Includes 102,499 shares held by Ms. Christopher-Finn's spouse, Mr. Charles
Finn, President and Chief Executive Officer of Wayne Savings, 2,192 shares
held in Ms. Christopher-Finn's individual retirement account, 8,172 shares
allocated to Ms. Christopher-Finn's account in the employee stock
ownership plan and 3,393 shares allocated to Ms. Christopher-Finn's
account in the Wayne Savings 401(k) Retirement Plan. Ms.
Christopher-Finn's address is c/o Wayne Savings Community Bank, 151 North
Market Street, Wooster, Ohio 44691.
(10) Includes 1,616 shares allocated to Mr. Anderson's account in the Wayne
Savings 401(k) Retirement Plan, 5,000 shares held in Mr. Anderson's
individual retirement account and 1,456 shares allocated to Mr. Anderson's
account in the Wayne Savings employee stock ownership plan.
(11) Includes shares subject to stock options which are currently or will
become exercisable within 60 days of June 16, 2005 as follows:
Name No. of Shares Subject to Options
----------------------- --------------------------------
Charles F. Finn 23,857
James C. Morgan 10,204
Kenneth R. Lehman 10,204
Russell L. Harpster 10,204
Joseph L. Retzler 10,204
Wanda Christopher-Finn 20,000
(12) Includes 22,141 shares allocated to executive officers pursuant to the
Wayne Savings Community Bank Employee Stock Ownership Plan, 84,673 shares
which may be acquired upon the exercise of stock options exercisable
within 60 days of June 16, 2005, the voting record date and 8,904 shares
allocated to the executive officers in the Wayne Savings 401(k) Retirement
Plan.
-16-
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the officers and directors, and persons who own more than 10% of our common
stock to file reports of ownership and changes in ownership with the Securities
and Exchange Commission. Officers, directors and greater than 10% stockholders
are required by regulation to furnish us with copies of all Section 16(a) forms
they file. We know of no person who owns 10% or more of Wayne Savings' common
stock.
Based solely on our review of the copies of such forms furnished to us, or
written representations from our officers and directors, we believe that during,
and with respect to, the fiscal year ended March 31, 2005, our officers and
directors complied in all respects with the reporting requirements promulgated
under Section 16(a) of the Securities Exchange Act of 1934.
- --------------------------------------------------------------------------------
PROPOSAL II - RATIFICATION OF APPOINTMENT OF AUDITORS
- --------------------------------------------------------------------------------
The Audit Committee of the Board of Directors of Wayne Savings has
appointed Grant Thornton LLP, independent registered public accounting firm, to
perform the audit of our financial statements for the year ending March 31,
2006, and further directed that the selection of auditors be submitted for
ratification by the stockholders at the annual meeting.
We have been advised by Grant Thornton LLP that neither that firm nor any
of its associates has any relationship with Wayne Savings or its subsidiaries
other than the usual relationship that exists between independent registered
public accounting firms and clients. Grant Thornton LLP will have one or more
representatives at the annual meeting who will have an opportunity to make a
statement, if they so desire, and will be available to respond to appropriate
questions.
In determining whether to appoint Grant Thornton LLP as our auditors, our
Audit Committee considered whether the provision of services, other than
auditing services, by Grant Thornton LLP is compatible with maintaining the
auditors' independence. In addition to performing auditing services as well as
reviewing Wayne Savings' public filings, our auditors performed tax-related
services, including the completion of Wayne Savings' corporate tax returns, in
fiscal 2005. The Audit Committee believes that Grant Thornton LLP's performance
of these other services is compatible with maintaining the auditor's
independence.
Audit Fees
The following table sets forth the aggregate fees paid by us to Grant
Thornton LLP for professional services rendered in connection with the audit of
our consolidated financial statements for 2005 and 2004, as well as the fees
paid by us to Grant Thornton LLP for audit-related services, tax services and
all other services rendered by Grant Thornton LLP to us during fiscal 2005 and
2004.
Year Ended March 31,
--------------------------------
2005 2004
-------- ---------
Audit fees (1) ............... $ 72,800 $ 70,500
Audit-related fees (2) ....... 17,250 21,300
Tax fees (3) ................. 25,418 13,140
All other fees ............... 5,600 --
-------- --------
Total ............... $121,068 $104,940
======== ========
- ---------------------
(1) Audit fees consist of fees incurred in connection with the audit of our
annual financial statements and the review of the interim financial
statements included in our quarterly reports filed with the Securities and
Exchange Commission, as well as work generally only the independent
auditor can reasonably be expected to provide, such as statutory audits,
consents and assistance with and review of documents filed with the
Securities and Exchange Commission.
(Footnotes continued on following page)
-17-
- ---------------------
(2) Includes for fiscal 2005 and 2004, assistance with and review of Wayne
Savings' quarterly filings on Form 10-Q as well as for fiscal 2004
assistance with respect to acquisitions, principally Stebbins National
Bank.
(3) Tax fees consist primarily of fees paid in connection with preparing
federal and state income tax returns and other tax related services.
As provided in its charter, the Audit Committee selects our independent
auditors and pre-approves all audit services to be provided by the independent
auditors to Wayne Savings. The Audit Committee also reviews and pre- approves
all audit-related and non-audit related services rendered by our independent
auditors in accordance with the Audit Committee's Pre-Approval Policy adopted in
April 2004. In its review of these services and related fees and terms, the
Audit Committee considers, among other things, the possible effect of the
performance of such services on the independence of our independent auditors.
The Audit Committee pre-approves certain audit-related services and certain
non-audit related tax services which are specifically described by the Audit
Committee on an annual basis and separately approves other individual
engagements as necessary.
Each new engagement of Grant Thornton LLP was approved in advance by the
Audit Committee, and none of those engagements made use of the de minimis
exception to pre-approval contained in the Securities and Exchange Commission
rules.
The Board of Directors recommends that you vote FOR the ratification of the
---
appointment of Grant Thornton LLP as our independent registered public
accounting firm for the fiscal year ending March 31, 2006.
- --------------------------------------------------------------------------------
STOCKHOLDER PROPOSALS, NOMINATIONS AND COMMUNICATIONS
WITH THE BOARD OF DIRECTORS
- --------------------------------------------------------------------------------
Stockholder Proposals. Any proposal which a stockholder wishes to have
included in the proxy materials of Wayne Savings relating to the next annual
meeting of stockholders, which is currently expected to be held in July 2006,
must be received at the principal executive offices of Wayne Savings Bancshares,
Inc., 151 North Market Street, Wooster, Ohio 44691, no later than March 2, 2006.
If such proposal is in compliance with all of the requirements of Rule 14a-8
under the Securities Exchange Act of 1934, as amended, it will be included in
the proxy statement and set forth on the form of proxy issued for such annual
meeting of stockholders. It is urged that any such proposals be sent certified
mail, return receipt requested.
Stockholder proposals which are not submitted for inclusion in Wayne
Savings' proxy materials pursuant to Rule 14a-8 may be brought before an annual
meeting pursuant to Section 6(b) of our Bylaws. Notice of the proposal must also
be given in writing and delivered to, or mailed and received at, our principal
executive offices by April 1, 2006. The notice must include the information
required by Section 6(b) of our Bylaws.
Stockholder Nominations. Our Bylaws provide that, subject to the rights of
the holders of any class or series of stock having a preference over the common
stock as to dividends or upon liquidation, all nominations for election to the
Board of Directors, other than those made by the Board or the Nominating
Committee thereof, shall be made by a stockholder who has complied with the
notice provisions in the Bylaws. Written notice of a stockholder nomination
generally must be communicated to the attention of the Corporate Secretary and
either delivered to, or mailed and received at, our principal executive offices
not later than, with respect to an annual meeting of stockholders, 90 days prior
to the anniversary date of the mailing of proxy materials by us in connection
with the immediately preceding annual meeting of stockholders. For our annual
meeting in 2006, this notice must have been received by April 1, 2006. Each
written notice of a stockholder nomination is required to set forth certain
information specified in Section 6(c) of our Bylaws. We did not receive any
stockholder nominations with respect to this annual meeting.
-18-
Other Stockholder Communications. Our Board of Directors has adopted a
formal process by which stockholders may communicate with the Board.
Stockholders who wish to communicate with our Board of Directors may do so by
sending written communications addressed to the Board of Directors of Wayne
Savings Bancshares, Inc. c/o Michael C. Anderson, Secretary, 151 North Market
Street, Wooster, Ohio 44691.
- --------------------------------------------------------------------------------
ANNUAL REPORTS
- --------------------------------------------------------------------------------
A copy of our Annual Report to Stockholders for the year ended March 31,
2005 accompanies this Proxy Statement. Such report is not part of the proxy
solicitation materials.
Upon receipt of a written request we will furnish without charge to any
stockholder a copy of the Annual Report on Form 10-K for fiscal 2005. Such
written requests should be directed to Mr. Michael C. Anderson, Secretary, Wayne
Savings Bancshares, Inc., 151 North Market Street, Wooster, Ohio 44691.
- --------------------------------------------------------------------------------
OTHER MATTERS
- --------------------------------------------------------------------------------
Management is not aware of any business to come before the annual meeting
other than the matters described above in this Proxy Statement. However, if any
other matters should properly come before the meeting, it is intended that the
proxies solicited hereby will be voted with respect to those other matters in
accordance with the judgment of the persons voting the proxies.
The cost of the solicitation of proxies will be borne by Wayne Savings.
Wayne Savings will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending the proxy
materials to the beneficial owners of our common stock. In addition to
solicitations by mail, directors, officers and employees of Wayne Savings may
solicit proxies personally or by telephone without additional compensation.
-19-
[X]PLEASE MARK VOTES
AS IN THIS EXAMPLE REVOCABLE PROXY
WAYNE SAVINGS BANCSHARES, INC.
ANNUAL MEETING OF STOCKHOLDERS
JULY 28, 2005
The undersigned hereby appoints the full Board of Directors, with full
substitution to act as proxies for the undersigned to vote all shares of common
stock of Wayne Savings Bancshares, Inc. which the undersigned is entitled to
vote at the Annual Meeting of Stockholders (the "Meeting") to be held at the
Greenbriar Conference Centre, 50 Riffel Road, Wooster, Ohio, at 10:00 a.m.
(local time) on July 28, 2005. The official proxy committee is authorized to
cast all votes to which the undersigned is entitled as follows: FOR the election
of all nominees and FOR the ratification of appointment of Grant Thornton LLP as
auditors for fiscal 2006.
This proxy is solicited by the Board of Directors.
1. The election as directors of all nominees listed (except as marked to the
contrary
With- For All
For hold Except
[_] [_] [_]
For three year term expiring in 2008:
Charles F. Finn Daniel R. Buehler
INSTRUCTION: To withhold authority to vote for any individual nominee,
mark "For All Except" and write that nominee's name in the space provided
below:
- --------------------------------------------------------------------------------
2. The ratification of the appointment of Grant Thornton LLP as auditors for
the fiscal year ending March 31, 2006.
For Against Abstain
[_] [_] [_]
PLEASE CHECK BOX IF YOU PLAN TO ATTEND THE MEETING. [_]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
EACH OF THE LISTED PROPOSALS.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS PROXY WILL BE VOTED FOR EACH OF THE PROPOSITIONS STATED HEREIN.
IF ANY OTHER BUSINESS IS PRESENTED AT SUCH MEETING, THIS PROXY WILL BE VOTED BY
THE NAMED PROXIES AT THE DIRECTION OF A MAJORITY OF THE BOARD OF DIRECTORS. AT
THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE
PRESENTED AT THE MEETING.
-----------------------
Please be sure to sign and date | Date |
this Proxy in the box below. | |
- --------------------------------------------------------------------------------
| |
| |
- -----------Stockholder sign above----------Co-holder (if any) sign above-------
- --------------------------------------------------------------------------------
^ Detach above card, sign, date and mail in postage paid envelope provided. ^
WAYNE SAVINGS BANCSHARES, INC.
- --------------------------------------------------------------------------------
The above signed acknowledges receipt from Wayne Savings Bancshares, Inc.
prior to the execution of this proxy of notice of the Meeting, a proxy statement
dated June 30, 2005 and audited financial statements.
Please sign exactly as your name appears on this card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder may sign but only one signature
is required.
PLEASE SIGN, DATE AND MAIL THIS PROXY CARD PROMPTLY
USING THE ENCLOSED POSTAGE-PREPAID ENVELOPE.
- --------------------------------------------------------------------------------
IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED
BELOW AND RETURN THIS PORTION WITH THE PROXY IN THE ENVELOPE PROVIDED.
- ----------------------------------
- ----------------------------------
- ----------------------------------
[X]Please Mark Votes
as in This Example 401(k) VOTING INSTRUCTION BALLOT
WAYNE SAVINGS BANCSHARES, INC.
The undersigned hereby instructs the Trustee of the 401(k) Retirement Plan
of Wayne Savings Community Bank to vote, as designated below, all the shares of
common stock of Wayne Savings Bancshares, Inc. allocated to my 401(k) Plan
account as of June 16, 2005, at the Annual Meeting of Stockholders to be held at
the Greenbriar Conference Centre located at 50 Riffel Road, Wooster, Ohio, on
Thursday, July 28, 2005, at 10:00 a.m., local time, or at any adjournment
thereof.
1. ELECTION OF DIRECTORS FOR THREE-YEAR TERM
[_]FOR [_]WITHHOLD [_]FOR ALL EXCEPT
Nominees for three-year term expiring in 2008:
Charles F. Finn and Daniel R. Buehler
Instruction: To withhold authority to vote for any individual nominee, mark "For
All Except" and write that nominee's name in the space provided below.
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2. PROPOSAL TO RATIFY THE APPOINTMENT of Grant Thornton LLP as auditors for
the fiscal year ending March 31, 2006.
[_]FOR [_]AGAINST [_] ABSTAIN
3. In its discretion, the Trustee is authorized to vote upon such other
business as may properly come before the meeting.
The Board of Directors recommends that you vote FOR the Board's nominees
for director and FOR the ratification of Grant Thornton LLP. Such votes are
hereby solicited by the Board of Directors.
If you return this card properly signed but you do not otherwise specify,
shares will be voted for the Board of Directors' nominees for director and for
the ratification of Grant Thornton LLP.
-----------------------
Please be sure to sign and date | Date |
in the box below. | |
- --------------------------------------------------------------------------------
| |
| |
- -----------Participant sign above----------------------------------------------
- --------------------------------------------------------------------------------
^ Detach above card, sign, date and mail in postage paid envelope provided. ^
WAYNE SAVINGS BANCSHARES, INC.
- --------------------------------------------------------------------------------
PLEASE MARK, SIGN, DATE AND RETURN
401(k) VOTING INSTRUCTION BALLOT TO BE RECEIVED BY JULY 25, 2005.
- --------------------------------------------------------------------------------
IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED
BELOW AND RETURN THIS PORTION WITH THE PROXY IN THE ENVELOPE PROVIDED.
- ----------------------------------
- ----------------------------------
- ----------------------------------
[X]Please Mark Votes
as in This Example ESOP VOTING INSTRUCTION BALLOT
WAYNE SAVINGS BANCSHARES, INC.
The undersigned hereby instructs the Trustees of the Employee Stock
Ownership Plan of Wayne Savings Community Bank to vote, as designated below, all
the shares of common stock of Wayne Savings Bancshares, Inc. allocated to my
ESOP account as of June 16, 2005 at the Annual Meeting of Stockholders to be
held at the Greenbriar Conference Centre located at 50 Riffel Road, Wooster,
Ohio, on Thursday, July 28, 2005 at 10:00 a.m., local time, or at any
adjournment thereof.
1. ELECTION OF DIRECTORS FOR THREE-YEAR TERM
[_]FOR [_]WITHHOLD [_]FOR ALL EXCEPT
Nominees for three-year term expiring in 2008:
Charles F. Finn and Daniel R. Buehler
Instruction: To withhold authority to vote for any individual nominee, mark "For
All Except" and write that nominee's name in the space provided below.
- -----------------------------------------------------------------------
2. PROPOSAL TO RATIFY THE APPOINTMENT of Grant Thornton LLP as auditors for
the fiscal year ending March 31, 2006.
[_]FOR [_]AGAINST [_] ABSTAIN
3. In their discretion, the Trustees are authorized to vote upon such other
business as may properly come before the meeting.
The Board of Directors recommends that you vote FOR the Board's nominees
for director and FOR the ratification of Grant Thornton LLP. Such votes are
hereby solicited by the Board of Directors.
If you return this card properly signed but you do not otherwise specify,
shares will be voted for the Board of Directors' nominees for director and for
the ratification of Grant Thornton LLP.
------------------------
Please be sure to sign and date | Date |
in the box below. | |
- --------------------------------------------------------------------------------
| |
| |
- -----------Participant sign above----------------------------------------------
- --------------------------------------------------------------------------------
^ Detach above card, sign, date and mail in postage paid envelope provided. ^
WAYNE SAVINGS BANCSHARES, INC.
- --------------------------------------------------------------------------------
PLEASE MARK, SIGN, DATE AND RETURN ESOP
VOTING INSTRUCTION BALLOT PROMPTLY TO BE RECEIVED BY JULY 25, 2005.
- --------------------------------------------------------------------------------
IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED
BELOW AND RETURN THIS PORTION WITH THE PROXY IN THE ENVELOPE PROVIDED.
- ----------------------------------
- ----------------------------------
- ----------------------------------
[Wayne Savings Letterhead]
June 30, 2005
To: Participants in Wayne Savings Community Bank's 401(k) Retirement Plan
and/or Employee Stock Ownership Plan
Re: Instructions for voting shares of Wayne Savings Bancshares, Inc.
As described in the enclosed materials, proxies are being solicited in
connection with the proposals to be considered at the upcoming Annual Meeting of
Stockholders of Wayne Savings Bancshares, Inc. We hope you will take advantage
of the opportunity to direct the manner in which shares of common stock of Wayne
Savings Bancshares allocated to your accounts in the 401(k) Plan and/or ESOP
will be voted. You may receive one or two Voting Instruction Ballots depending
on whether you have accounts in both the ESOP and 401(k) Plan.
Enclosed with this letter is the Proxy Statement, which describes the
matters to be voted upon, the Annual Report to Stockholders and Voting
Instruction Ballot(s). After you have reviewed the Proxy Statement, we urge you
to vote your allocated shares held in the 401(k) Plan and/or ESOP by marking,
dating, signing and returning the enclosed Voting Instruction Ballot(s) in the
envelope provided. Huntington National Bank will tabulate the votes for the
purpose of having those shares voted by the Trustees. In order to be effective,
your Voting Instruction Ballot(s) must be received by Huntington no later than
July 25, 2005.
We urge each of you to vote, as a means of participating in the governance
of the affairs of Wayne Savings Bancshares. If your voting instructions are not
received, the shares allocated to your 401(k) Plan and/or ESOP accounts will
generally not be voted. While I hope that you will vote in the manner
---
recommended by the Board of Directors, the most important thing is that you vote
in whatever manner you deem appropriate. Please take a moment to do so.
Please note that the enclosed material relates only to those shares which
have been allocated to you in your account(s) under the 401(k) Plan and/or ESOP.
If you also own shares of Wayne Savings Bancshares common stock outside of the
401(k) Plan and/or ESOP, you should receive other voting material for those
shares owned by you individually. Please return all your voting material so that
all your shares may be voted.
Sincerely,
/s/ Charles F. Finn
Charles F. Finn
Chairman, President and Chief Executive Officer