SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant /_/
Check the appropriate box:
/_/ Preliminary Proxy Statement
/_/ Definitive Proxy Statement
/X/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
CODORUS VALLEY BANCORP, INC.
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/_/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1) or 14a-6(j)(2).
/_/ $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
/X/ No fee required.
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:*
_____________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
_____________________________________________________________________________
/_/ 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 No. ______________________________________
3) Filing party: ___________________________________________________________
4) Date filed: _____________________________________________________________
___________
*Set forth the amount on which the filing fee is calculated and state how it was
determined.
[ LOGO ]
April 9, 1997
DEAR SHAREHOLDER:
It is my pleasure to invite you to attend the 1997 Annual Meeting of
Shareholders of Codorus Valley Bancorp, Inc. to be held on Tuesday, May 20,
1997, at 10:00 a.m., prevailing time. The Annual Meeting this year will be held
at the Holiday Inn Holidome (at West Manchester Mall), Red & White Rose Rooms,
2000 Loucks Road, York, Pennsylvania 17404.
The Notice of the Annual Meeting and the Proxy Statement on the following
pages address the formal business of the meeting. The formal business schedule
includes: the election of three (3) Class A Directors, and the ratification of
the selection of the independent auditors for 1997. At the meeting, members of
the Corporation's management will review the Corporation's operations during the
past year and be available to respond to questions.
We strongly encourage you to vote your shares, whether or not you plan to
attend the meeting. It is very important that you sign, date and return the
accompanying Proxy as soon as possible, in the postage prepaid envelope. If you
do attend the meeting and wish to vote in person, you must give written notice
thereof to the Secretary of the Corporation so that your Proxy will be
superseded by any ballot that you submit at the meeting.
Sincerely,
/s/ Larry J. Miller
------------------------------
Larry J. Miller, President and
Chief Executive Officer
Codorus Valley Bancorp, Inc.,
1 Manchester Street, P.O. Box 67, Glen Rock, PA 17327
- --------------------------------------------------------------------------------
CODORUS VALLEY BANCORP, INC.
------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 20, 1997
------------------------------------------------------
TO THE SHAREHOLDERS OF CODORUS VALLEY BANCORP, INC.:
Notice is hereby given that the Annual Meeting of Shareholders of CODORUS
VALLEY BANCORP, INC. (the "Corporation") will be held at 10:00 a.m., prevailing
time, on Tuesday, May 20, 1997, at the Holiday Inn Holidome (at West Manchester
Mall), Red & White Rose Rooms, 2000 Loucks Road, York, Pennsylvania 17404, for
the following purposes:
1. To elect three (3) Class A Directors to serve for a three-year term
and until their successors are elected and qualified;
2. To ratify the selection of Ernst & Young LLP, as the independent
auditors for the Corporation for the year ending December 31, 1997; and
3. To transact such other business as may properly come before the
Annual Meeting and any adjournment or postponement thereof.
In accordance with the By-laws of the Corporation and action of the Board
of Directors, only those shareholders of record at the close of business on
March 28, 1997, will be entitled to notice of and to vote at the Annual Meeting
and any adjournment or postponement thereof.
A copy of the Corporation's Annual Report for the fiscal year ended
December 31, 1996, is enclosed with this Notice. Copies of the Corporation's
Annual Report for the 1995 fiscal year may be obtained at no cost by contacting
Larry J. Miller, President and Chief Executive Officer, One Manchester Street,
P.O. Box 67, Glen Rock, Pennsylvania 17327, telephone: 1-800-646-1970.
You are urged to mark, sign, date and promptly return your Proxy in the
enclosed envelope so that your shares may be voted in accordance with your
wishes and in order that the presence of a quorum may be assured. The prompt
return of your signed Proxy (and voting instruction card, if applicable),
regardless of the number of shares you hold, will aid the Corporation in
reducing the expense of additional proxy solicitation. The giving of such Proxy
does not affect your right to vote in person if you attend the meeting and give
written notice to the Secretary of the Corporation. If you are a participant in
the Corporation's Dividend Reinvestment and Stock Purchase Plan, you will
receive separate instructions with respect to your shares held in the Dividend
Reinvestment and Stock Purchase Plan.
By Order of the Board of Directors,
/s/ Larry J. Miller
------------------------------
Larry J. Miller, President and
Chief Executive Officer
April 9, 1997
CODORUS VALLEY BANCORP, INC.
PROXY STATEMENT FOR THE ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON MAY 20, 1997
GENERAL
INTRODUCTION, DATE, TIME AND PLACE OF ANNUAL MEETING
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of CODORUS VALLEY BANCORP, INC. (the "Corporation"), a
Pennsylvania business corporation, of proxies to be voted at the Annual Meeting
of Shareholders of the Corporation to be held on Tuesday, May 20, 1997, at 10:00
a.m., prevailing time, at the Holiday Inn Holidome (at West Manchester Mall),
Red & White Rose Rooms, 2000 Loucks Road, York, Pennsylvania 17404, and at any
adjournment or postponement of the Annual Meeting.
The principal executive office of the Corporation is located at
PeoplesBank, a Codorus Valley Company (the "Bank"), formerly Peoples Bank of
Glen Rock, One Manchester Street, P.O. Box 67, Glen Rock, Pennsylvania 17327.
The telephone number for the Corporation is: 1-800-646-1970. All inquiries
should be directed to Larry J. Miller, President and Chief Executive Officer of
the Corporation. The Bank is a wholly-owned subsidiary of the Corporation.
SOLICITATION AND VOTING OF PROXIES
This Proxy Statement and the enclosed form of proxy (the "Proxy") are first
being sent to shareholders of the Corporation on or about April 9, 1997.
Shares represented by proxies on the accompanying Proxy, if properly signed
and returned, will be voted in accordance with the specifications made thereon
by the shareholders. Any Proxy not specifying to the contrary will be voted FOR
the election of the nominees for Class A Director named below, and FOR the
ratification of the selection of Ernst & Young LLP, as the independent auditors
for the Corporation for the year ending December 31, 1997. Execution and return
of the enclosed Proxy will not affect a shareholder's right to attend the Annual
Meeting and vote in person, after giving written notice to the Secretary of the
Corporation.
If a shareholder is a participant in the Codorus Valley Bancorp, Inc.
Dividend Reinvestment and Stock Purchase Plan (the "Plan"), the enclosed Proxy
will not serve as a voting instruction card for the shares held in the Plan.
Instead, these participants will receive from Registrar and Transfer Company, as
the administrator of the Plan, separate voting instruction cards covering the
shares held within the Plan. These separate voting instruction cards must be
signed and returned or the shares held in the Plan will not be voted.
The cost of preparing, assembling, printing, mailing and soliciting
proxies, and any additional material that the Corporation may furnish
shareholders in connection with the Annual Meeting, will be borne by the
Corporation. In addition to the use of the mails, certain directors, officers
and employees of the Corporation and the Bank may solicit proxies personally, by
telephone, telegraph and telecopier. Arrangements will be made with brokerage
houses and other custodians, nominees and fiduciaries to forward proxy
solicitation material to the beneficial owners of stock held of record by these
persons and, upon request therefor, the Corporation will reimburse them for
their reasonable forwarding expenses.
1
REVOCABILITY OF PROXY
A shareholder who returns a Proxy (and a voting instruction card, if
applicable) may revoke the Proxy (and a voting instruction card, if applicable)
at any time before it is voted only: (1) by giving written notice of revocation
to Dallas L. Smith, Secretary of Codorus Valley Bancorp, Inc., at One Manchester
Street, P.O. Box 67, Glen Rock, Pennsylvania 17327; (2) by executing a
later-dated proxy (and a voting instruction card, if applicable) and giving
written notice thereof to the Secretary of the Corporation; or (3) by voting in
person after giving written notice to the Secretary of the Corporation.
VOTING SECURITIES, RECORD DATE AND QUORUM
The Corporation is currently authorized to issue 10,000,000 shares of
common stock, par value $2.50 per share and 1,000,000 shares of preferred stock,
par value $2.50 per share.
At the close of business on March 28, 1997, the Corporation had outstanding
1,045,296 shares of common stock, par value $2.50 per share, the only issued and
outstanding class of stock (the "Common Stock"). As of March 28, 1997, none of
the shares of preferred stock were issued.
Only holders of Common Stock of record at the close of business on March
28, 1997, will be entitled to notice of and to vote at the Annual Meeting.
Cumulative voting rights do not exist with respect to the election of directors.
On all matters to come before the Annual Meeting, each share of Common Stock is
entitled to one vote.
Under Pennsylvania law and the By-laws of the Corporation, the presence of
a quorum is required for each matter to be acted upon at the Annual Meeting.
Pursuant to Article 3, Section 3.1, of the By-laws of the Corporation, the
presence, in person or by proxy, of shareholders entitled to cast at least a
majority of the votes that all shareholders are entitled to cast constitutes a
quorum for the transaction of business at the Annual Meeting. Votes withheld and
abstentions will be counted in determining the presence of a quorum for the
particular matter. Broker non-votes will not be counted in determining the
presence of a quorum for the particular matter as to which the broker withheld
authority.
Assuming the presence of a quorum, the three nominees for director
receiving the highest number of votes cast by shareholders entitled to vote for
the election of directors shall be elected. Votes withheld from a nominee and
broker non-votes will not be cast for such nominee.
Assuming the presence of a quorum, the affirmative vote of a majority of
all votes cast by shareholders is required for ratification of the selection of
independent auditors. Abstentions and broker non-votes are not deemed to
constitute "votes cast" and, therefore, do not count either for or against
ratification. Abstentions and broker non-votes, however, have the practical
effect of reducing the number of affirmative votes required to achieve a
majority for the matter by reducing the total number of shares voted from which
the required majority is calculated.
2
PRINCIPAL BENEFICIAL OWNERS OF THE CORPORATION'S STOCK
PRINCIPAL OWNERS
The following table sets forth, as of December 31, 1996, the name and
address of each person who owns of record or who is known by the Board of
Directors to be the beneficial owner of more than 5 percent of the Corporation's
outstanding Common Stock, the number of shares beneficially owned by such person
and the percentage of the Corporation's outstanding Common Stock so owned.
PERCENT OF
SHARES OUTSTANDING
BENEFICIALLY COMMON STOCK
NAME AND ADDRESS OWNED BENEFICIALLY OWNED
- ---------------- ------------ ------------------
CEDE & Co. 145,005 13.87%
P.O. Box 20
Bowling Green Station
New York, New York 10004
PBT Company 82,235(1) 7.87%
PeoplesBank, a Codorus Valley Company
Trust and Investment Services
120 Pine Grove Commons
York, Pennsylvania 17403
- ------------------
(1) 61,338 shares of Common Stock beneficially owned by the Bank are held by the
Bank's Trust and Investment Services Department (the "Trust Department") in
its fiduciary capacity. The Trust Department has sole voting and dispositive
power over these shares of Common Stock. 17,884 shares of Common Stock
beneficially owned by the Bank are held by the Trust Department in one trust
account which provides for the Bank to exercise sole dispositive power. The
Trust Department has shared voting power over these shares of Common Stock.
3,013 shares of Common Stock beneficially owned by the Bank are held by the
Trust Department in agency accounts which provides for the Bank to exercise
sole voting power. The Trust Department has no dispositive power over these
shares of Common Stock. The Bank's Trust Department intends to cast all
shares under its control FOR the election of the nominees for director named
below, and FOR the ratification of Ernst & Young LLP, as the independent
auditors for the Corporation.
3
BENEFICIAL OWNERSHIP BY OFFICERS, DIRECTORS AND NOMINEES
The following table sets forth, as of March 28, 1997, and from information
received from the respective individuals, the amount and percentage of the
Common Stock beneficially owned by each director, each nominee and all officers,
directors and nominees of the Corporation as a group. The percent of outstanding
stock is less than 1%, unless otherwise indicated.
AMOUNT AND
NATURE
NAME OF INDIVIDUAL OF BENEFICIAL PERCENT
OR IDENTITY OF GROUP OWNERSHIP(1)(2) OF CLASS
- -------------------- --------------- --------
CURRENT CLASS A DIRECTORS
NOMINEES AS CLASS A DIRECTORS
(To Serve Until 2000)
Rodney L. Krebs 2,428(3) --
Dallas L. Smith 1,927 --
George A. Trout, D.D.S. 22,387(4) 2.14%
CONTINUING CLASS C DIRECTORS
(To Serve Until 1998)
D. Reed Anderson, Esq. 434 --
MacGregor S. Jones 4,472(5) --
Larry J. Miller 4,046(6) --
CONTINUING CLASS B DIRECTORS
(To Serve Until 1999)
M. Carol Druck 521(7) --
Barry A. Keller 14,020 1.34%
Donald H. Warner 231 --
All Officers, Directors and
Nominees as a group
(10 persons) 50,586 4.84%
- ------------------
(1) Includes Common Stock held in fiduciary accounts in the Bank's Trust and
Investment Services Department.
(2) The securities "beneficially owned" by an individual are determined in
accordance with the definitions of "beneficial ownership" set forth in the
General Rules and Regulations of the Securities and Exchange Commission and
may include securities owned by or for the individual's spouse and minor
children and any other relative who has the same home, as well as securities
to which the individual has, or shares, voting or investment power or has
the right to acquire beneficial ownership within 60 days after March 28,
1997. Beneficial ownership may be disclaimed as to certain of the
securities.
(3) Includes 1,102 shares held jointly with Mr. Kreb's spouse.
(4) Includes 19,307 shares held jointly with Dr. Trout's spouse.
(5) Includes 1,610 shares held jointly with Mr. Jones's spouse and 739 shares
held individually by his spouse.
4
(6) Includes 2,872 shares held jointly with Mr. Miller's spouse, 89 shares held
jointly with his mother, 234 shares held jointly with his daughter, and 234
shares held jointly with his son. Does not include 6,000 qualified stock
options granted to Mr. Miller in 1996, which options are not presently
exercisable.
(7) Includes 391 shares held jointly with Mrs. Druck's spouse.
ELECTION OF DIRECTORS
The By-laws of the Corporation provide that the Corporation's business
shall be managed by its Board of Directors. Section 10.2 of the By-laws provides
that the number of directors that constitutes the whole Board of Directors shall
not be less than five nor more than twenty-five and that the Board of Directors
shall be classified into three classes, each class to be elected for a term of
three years. Within the foregoing limits, the Board of Directors may, from time
to time, fix the number of directors and their respective classifications. No
person shall be elected as a director who has not attained the age of 21 years.
No person shall serve as a director after he or she has attained the age of 70
years. Each director shall also hold solely, in his or her name, at least 100
shares of Common Stock, which shares shall be free of any liens or other forms
of encumbrances. The Board of Directors has fixed the number of Board members at
nine, with three directors in each class. Pursuant to Section 11.1 of the
By-laws, vacancies on the Board of Directors, including vacancies resulting from
an increase in the number of directors, shall be filled by a majority of the
remaining members of the Board of Directors, though less than a quorum, and each
person so appointed shall be a director until the expiration of the term of
office of the class of directors to which he or she was appointed.
In accordance with Section 10.3 of the By-laws, at the 1997 Annual Meeting
of Shareholders, three (3) Class A Directors shall be elected to serve for a
three-year term and until their successors are elected and qualified. Therefore,
the By-laws provide for a classified Board of Directors with staggered
three-year terms of office.
Unless otherwise instructed, the Proxyholders will vote the Proxies
received by them for the election of the three nominees named below. If any
nominee should become unavailable for any reason, Proxies will be voted in favor
of a substitute nominee as the Board of Directors of the Corporation determines.
The Board of Directors has no reason to believe that the nominees named will be
unable to serve, if elected.
There is no cumulative voting for the election of directors. Each share of
Common Stock is entitled to cast only one vote for each nominee. For example, if
a shareholder owns 10 shares of Common Stock, he or she may cast up to ten votes
for each of the three directors in the class to be elected.
5
INFORMATION AS TO NOMINEES AND DIRECTORS
The following table contains certain information with respect to the
executive officers, nominees for Class A Director, current directors of the
Corporation and the committees of the Bank's Board of Directors.
AGE AS OF PRINCIPAL OCCUPATION FOR
MARCH 31, PAST FIVE YEARS AND POSITIONS DIRECTOR
NAME 1997 HELD WITH CORPORATION AND THE BANK SINCE
- ---- --------- ---------------------------------- --------
CLASS A DIRECTORS AND NOMINEES
FOR CLASS A DIRECTOR
(To Serve Until 2000)
- ---------------------
Rodney L. Krebs(3) 56 President, Springfield Contractors, Inc.; 1988/1988
Treasurer of Corporation, since February,
1990.
Dallas L. Smith(2) 51 President, Bruce V. Smith, Inc. (furniture 1986/1983
and appliances); Secretary of Corporation,
since January, 1994; Assistant Treasurer
and Assistant Secretary of Corporation,
November 1988 - January 1994.
George A. Trout, D.D.S.(1)(4) 62 Dentist; Chairman of Corporation, since 1986/1975
January, 1994; Vice Chairman of
Corporation January 1993 - January 1994;
Vice President of Corporation November
1988 - January 1993; Vice Chairman of
Bank, since 1992.
CLASS C DIRECTORS
(To Serve Until 1998)
- ---------------------
D. Reed Anderson, Esq.(3) 54 Attorney-at-Law, Stock and 1994/1994
Leader, P.C.
MacGregor S. Jones(1)(2) 51 President, Mac Jones Ford, Inc.; Assistant 1993/1993
Secretary of Corporation, since January,
1994.
Larry J. Miller(1)(4) 45 Commercial Banker; President and Chief 1986/1981
Executive Officer of Corporation, since
1986 and of Bank, since 1981.
6
AGE AS OF PRINCIPAL OCCUPATION FOR
MARCH 31, PAST FIVE YEARS AND POSITIONS DIRECTOR
NAME 1997 HELD WITH CORPORATION AND THE BANK SINCE
- ---- --------- ---------------------------------- --------
CLASS B DIRECTORS
(To Serve Until 1999)
- ---------------------
M. Carol Druck(2) 48 President, Druck Realty, Inc. d/b/a RE/MAX 1988/1988
Advanced Realty; Realtor/Broker; Assistant
Secretary of Corporation, since April,
1990; Assistant Treasurer of Corporation,
since January, 1994.
Barry A. Keller(1) 63 Insurance Broker/Consultant, Keller-Brown 1986/1977
Insurance Services; Vice Chairman of
Corporation, since January, 1994;
Secretary of Corporation November 1988 -
January 1994; Chairman of Bank, since
January, 1994.
Donald H. Warner(1)(3) 58 President, Warner Services, Inc. (moving 1990/1990
and storage company); Vice President of
Corporation since January 1993.
- ------------------
(1) Member of the Bank's Executive Committee. This committee is authorized to
meet at the call of an officer, primarily to take action regarding the
purchase and sale of securities and to pass on loans presented for discount
between regular meetings of the Board of Directors. This committee did not
meet in 1996. All matters of this committee were considered by the entire
Board of Directors. Mr. Barry A. Keller is Chairman of the Executive
Committee.
(2) Member of the Bank's Audit Committee. The Audit Committee has as its primary
functions the recommendation of an outside auditor for each fiscal year and
the oversight of the Bank's audit function. This committee is also the
source for reports concerning factual conflicts of interest, reviews
circumstances regarding conflicts of interest and reports same to the full
Board of Directors, if necessary. This committee met five (5) times in 1996.
Mrs. M. Carol Druck is Chairperson of the Audit Committee.
(3) Member of the Bank's Trust and Investment Services Committee. This committee
makes recommendations and supervises the operation of the Trust and
Investment Services Department. There were nine (9) meetings of the Trust
and Investment Services Committee in 1996. Mr. Rodney L. Krebs is Chairman
of the Trust and Investment Services Committee.
(4) Members of the Bank's Asset Liability Committee (ALCO). This committee met
nine (9) times in 1996 to review asset and liability management of the Bank.
Other members of the committee include the following bank officers: Messrs.
Dennis H. Engle, Todd A. Tyson, and Jann Allen Weaver. Mr. Larry J. Miller
is Chairman of the committee.
The aforementioned committees are committees of the Bank and not of the
Corporation.
7
During 1996, the Bank's Board of Directors held twenty-five (25) meetings
and the Corporation's Board of Directors held nine (9) meetings. Each of the
Directors attended at least 75 percent of the combined total number of meetings
of the Corporation's and the Bank's Boards of Directors and the committees of
which he or she is a member, except Mr. Warner.
The Board of Directors of the Corporation has, at present, no standing
committees. The Corporation does not have a compensation or a nominating
committee. A shareholder who desires to propose an individual for consideration
by the Board of Directors as a nominee for director should submit a proposal in
writing to the Secretary of the Corporation in accordance with Section 10.1 of
the Corporation's By-laws. Any shareholder who intends to nominate any candidate
for election to the Board of Directors must notify the Secretary of the
Corporation in writing not less than ninety (90) days prior to the date of any
meeting of shareholders called for the election of directors.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Corporation's officers and directors, and persons who own more than 10
percent of the registered class of the Corporation's equity securities, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission ("SEC"). Officers, directors and greater than 10 percent shareholders
are required by SEC regulation to furnish the Corporation with copies of all
Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Corporation believes that during the period
January 1, 1996, through December 31, 1996, its officers and directors were in
compliance with all filing requirements applicable to them, with the exception
of Mr. Jones who inadvertently filed a late Form to report one transaction
during 1996.
EXECUTIVE COMPENSATION
The following table sets forth information concerning the annual
compensation for services in all capacities to the Corporation and to the Bank
for the fiscal years ended December 31, 1996, 1995 and 1994 of those persons who
were, at December 31, 1996, (i) Chief Executive Officer, and (ii) the other four
most highly compensated executive officers of the Corporation and of the Bank to
the extent such persons' total annual salary and bonus exceeded $100,000.
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
-------------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------------- ---------------------------- -------------
(A) (B) (C) (D) (E) (F) (G) (H)
OTHER
NAME ANNUAL RESTRICTED
AND COMPEN- STOCK OPTIONS/
PRINCIPAL SALARY BONUS SATION AWARDS SARS PAYOUTS
POSITION YEAR ($) ($) ($) ($) (#) ($)
- -------------------------- --------- --------- --------- --------------- --------------- ----------- -------------
Larry J. Miller 1996 143,252 10,000 0 0 6,000 0
President and 1995 136,499 10,000 0 0 0 0
Chief Executive 1994 133,057 0 0 0 0 0
Officer of the
Corporation and
the Bank
(A) (I)
NAME ALL OTHER
AND COMPEN-
PRINCIPAL SATION
POSITION ($)(1)(2)
- -------------------------- -----------
Larry J. Miller 6,883
President and 3,980
Chief Executive 3,127
Officer of the
Corporation and
the Bank
- ------------------
(1) Includes Bank contributions to 401(k) Plan of $5,595, $2,678 and $2,411 for
1996, 1995 and 1994, respectively.
(2) Includes Life Insurance Premiums amounting to $1,288, $1,302 and $716 for
1996, 1995 and 1994, respectively.
8
The following table sets forth certain information relating to options
granted by the Corporation in 1996. No options were exercised during the fiscal
year ended December 31, 1996.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
- --------------------------------------------------------------------------------------------------------
INDIVIDUAL GRANTS
- --------------------------------------------------------------------------------------------------------
NAME NUMBER OF PERCENT OF TOTAL EXERCISE OR EXPIRATION
SECURITIES OPTIONS/SARS BASE PRICE DATE
UNDERLYING GRANTED TO ($/SH)
OPTIONS/SARS EMPLOYEES IN FISCAL
GRANTED (#) YEAR
(A) (B) (C) (D) (E)
- --------------------------------------------------------------------------------------------------------
Larry J. Miller, 5,000/0 100%(1) $28.50 11/01/06
President and Chief 1,000/0 $29.125 12/10/06
Executive Officer of the
Corporation and the Bank
- --------------------------------------------------------------------------------------------------------
(1) Separate grants to Mr. Miller of options to buy 5,000 and 1,000 shares on
November 11, 1996, and December 10, 1996, respectively, which grants
represent 100% of the options granted by the Corporation in 1996.
STOCK OPTION PLAN
The Corporation maintains the 1996 Stock Incentive Plan (the "Plan"), which
Plan was approved by shareholders at the 1996 Annual Meeting, to advance the
development, growth and financial condition of the Corporation and its
subsidiaries. The Corporation reserved 50,000 shares under the Plan. The Plan
provides for awards of qualified stock options and non-qualified stock options
and is administered by a disinterested committee of the Corporation's Board of
Directors. In 1996, 6,000 qualified stock options were granted under the Plan.
RETIREMENT PLAN
The Corporation does not have a retirement or pension plan. The Bank,
however, maintains a retirement plan (the "Plan") for officers and employees.
All officers and employees who meet the service requirements are eligible for
the Plan after the first full year of service with the Bank. At the present
time, there are 130 persons enrolled in the Plan. Normal retirement age is 65
years. The Bank incurred expenses of $60,610 for financial reporting purposes
during 1996.
On January 20, 1997, the Board of Directors announced that all benefit
accruals under the Plan will be suspended, as of February 28, 1997, and that the
Plan will terminate, effective April 30, 1997. The Board took this action after
determining that the costs associated with the Plan exceeded the eventual
benefit to employees, and that there are more beneficial alternatives available.
Upon termination of the Plan, excess assets will be distributed to plan
participants in the form of cash or deposited to another retirement plan.
Retirees will receive an irrevocable annuity. The plan administrator believes
that the assets of the Plan will be adequate to fund all benefit liabilities.
Management currently believes that the impact of the termination of the Plan
will not have a material impact on the Corporation during 1997 in connection
with the Plan.
9
401(K) PLAN
The Bank maintains a defined contribution - profit sharing 401(K) Plan (the
"Plan"). The Plan Sponsor is PeoplesBank. The Plan is administered by a
committee designated by the Plan Sponsor. Larry J. Miller, President and Chief
Executive Officer of the Corporation and the Bank, and Bruce A. Lamborne, Vice
President and Trust Officer of the Bank, are the Plan Trustees. The Plan is
subject to the Internal Revenue Code and to the regulations promulgated
thereunder. Participants are entitled to certain rights and protection under the
Employee Retirement Income Security Act of 1974.
To be eligible to become a participant in the Plan, an employee must attain
the age of 21 and work one year during which the employee completes 1,000 hours
of service. An eligible employee may elect to contribute certain portions of
salary, wage, bonus (other than year end bonus), or other direct remuneration to
the Plan. Generally, eligible employees may not contribute more than 20 percent
of such compensation. The Bank matches a certain percentage of the employee's
contribution. In 1994, 1995 and 1996, the Bank matched 50 percent of the first 6
percent of the employee's contribution. The Bank's contributions to the Plan for
each participant vest in three years. The employee's contributions to the Plan
vest immediately. The Bank incurred expenses of $44,000, $44,000 and $42,000,
for financial reporting purposes during 1996, 1995 and 1994, respectively, in
connection with the Plan.
EMPLOYMENT CONTRACT
During 1993, the Corporation, the Bank and Mr. Larry J. Miller, President
and Chief Executive Officer of the Corporation and the Bank, entered into an
employment agreement for a term of three (3) years, which term renews
automatically for an additional twelve months at the end of each calendar year
unless the Corporation and Bank provide written notice to Mr. Miller of
non-renewal. The agreement specifies Mr. Miller's position and duties,
compensation and benefits, and indemnification and termination provisions. The
agreement also contains a non-competition provision and a confidentiality
provision.
Under the terms of his employment agreement, Mr. Miller serves as the
President and Chief Executive Officer of the Corporation and of the Bank and as
a member of the Boards of Directors of the Corporation and of the Bank. Pursuant
to the employment agreement, Mr. Miller was entitled to an annual direct salary
of $143,252 in 1996. This salary may be increased in subsequent years as the
Board of Directors deems appropriate. In addition, the Boards of Directors of
the Corporation and the Bank have discretion to pay a periodic bonus to Mr.
Miller. Mr. Miller is not entitled to receive director's fees or other
compensation for serving on the Corporation's and the Bank's Boards of Directors
or the committees thereof. Mr. Miller is also entitled to receive the employee
benefits made available by the Bank to its employees and to use of a Bank
vehicle.
The agreement with Mr. Miller also provides that if his employment is
terminated by the Corporation or the Bank, due to death, disability or for cause
(as defined therein), then he is entitled to the full annual direct salary
through the date of termination. If Mr. Miller's employment is terminated by the
Corporation or the Bank other than pursuant to death, disability or for cause
(as defined therein), then he is entitled to his full annual direct salary from
the date of termination through the last day of the term of the agreement, or
his current annual direct salary, whichever is greater. If Mr. Miller terminates
his employment for good reason (as defined therein), then he is entitled to an
amount equal to his direct annual salary. If Mr. Miller's employment is
terminated as a result of a change in control (as defined therein), then he is
entitled to his full annual direct salary from the date of change of control (as
defined therein) through the last day of the term of the agreement, or an amount
equal to his current annual direct salary, whichever is greater.
10
COMPENSATION OF DIRECTORS
During 1996, non-employee Bank directors received $250 for each Directors'
regular or special meeting attended, $75.00 per hour for each committee meeting
attended, and a monthly retainer of $500.00. The Chairman of the Bank's Board of
Directors received a monthly retainer of $600.00. In addition, the Bank pays
life insurance premiums on behalf of the non-employee Bank directors which
amounted to $1,296 in 1996. In the aggregate, the members of the Board of
Directors received $106,775, including $7,200 deferred by Mr. Keller, pursuant
to the Independent Directors Deferred Compensation Plan, described below, for
all Board of Directors' meetings and committee meetings attended in 1996,
including all fees, retainers and premiums paid to and on behalf of all
non-employee Bank directors in 1996.
Directors received no remuneration for attendance at the meetings of the
Board of Directors of the Corporation.
INDEPENDENT DIRECTORS DEFERRED COMPENSATION PLAN
The Corporation maintains a Deferred Compensation Plan for certain
independent directors, as defined and designated pursuant to the plan. Plan
participants may elect to defer receipt of compensation in order to provide
certain benefits taxable under Section 451 of the Internal Revenue Code of 1986,
as amended. This is an unfunded plan of the Corporation.
CERTAIN TRANSACTIONS
There have been no material transactions between the Corporation and the
Bank, nor any material transactions proposed, with any director or executive
officer of the Corporation and the Bank, or any associate of the foregoing
persons. The Corporation and the Bank have had and intend to continue to have
banking and financial transactions in the ordinary course of business with
directors and officers of the Corporation and the Bank and their associates on
comparable terms and with similar interest rates as those prevailing from time
to time for other customers of the Corporation and the Bank.
Total loans outstanding from the Corporation and the Bank at December 31,
1996, to the Corporation's and the Bank's officers and directors as a group and
to members of their immediate families and companies in which they had an
ownership interest of 10 percent or more was $3,197,174, or approximately 14.1
percent of the total equity capital of the Bank. Loans to such persons were made
in the ordinary course of business, were made on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons, and did not involve more than the
normal risk of collectibility or present other unfavorable features. The largest
aggregate amount of indebtedness outstanding at any time during fiscal year 1996
to officers and directors of the Corporation and the Bank as a group was
$3,604,649. The aggregate amount of indebtedness outstanding as of the latest
practicable date, March 24, 1997, to the above described group was $3,473,964.
11
PRINCIPAL OFFICERS OF THE CORPORATION
The following table sets forth selected information about the principal
officers of the Corporation, each of whom is elected by the Board of Directors
and each of whom holds office at the discretion of the Board of Directors:
BANK NUMBER OF SHARES AGE AS OF
HELD EMPLOYEE BENEFICIALLY MARCH 28,
NAME AND POSITION SINCE SINCE OWNED 1997
----------------- ----- -------- ---------------- ---------
George A. Trout, D.D.S. -- 1994 (1) 22,387 62
Chairman of the Board
Barry A. Keller -- 1994 (1) 14,020 63
Vice Chairman of the Board
Larry J. Miller -- President 1986 1971(2) 4,046(3) 45
and Chief Executive Officer
Donald H. Warner -- 1993 (1) 231 58
Vice President
Dallas L. Smith -- 1994 (1) 1,927 51
Secretary
Rodney L. Krebs -- 1990 (1) 2,428 56
Treasurer
Jann Allen Weaver -- 1991 1986 120(4) 47
Assistant Treasurer
and Assistant Secretary
- ------------------
(1) Messrs. Trout, Keller, Warner, Smith and Krebs are not employees of the
Bank.
(2) Mr. Miller has been employed by the Bank for 26 years and, for the last 16
years, as President and Chief Executive Officer.
(3) Shares do not include 6,000 stock options granted to Mr. Miller in 1996,
which options are not presently exercisable.
(4) Shares held jointly by Mr. Weaver and his spouse.
12
PRINCIPAL OFFICERS OF THE BANK
The following table sets forth selected information about the principal
officers of the Bank, each of whom is elected by the Board of Directors and each
of whom holds office at the discretion of the Board of Directors:
NUMBER OF
BANK SHARES AGE AS OF
HELD EMPLOYEE BENEFICIALLY MARCH 28,
NAME OFFICE AND POSITION WITH THE BANK SINCE SINCE OWNED 1997
---- --------------------------------- ----- -------- ------------ ---------
Barry A. Keller Chairman of the Board 1994 (1) 14,020 63
Larry J. Miller President and Chief Executive Officer 1981 1971 4,046(2) 45
Dennis H. Engle Executive Vice President and Chief 1992 1992 13(3) 45
Lending Officer
Jann Allen Weaver Senior Vice President and Chief 1989 1986 120 47
Financial Officer
Timothy E. Senft Vice President/Cashier and Chief 1989 1980 139 38
Operations Officer
Bruce A. Lamborne Vice President/Trust and Investment 1989 1988 210(4) 50
Services
- ------------------
(1) Mr. Keller is not an employee of the Bank.
(2) Does not include 6,000 qualified stock options granted to Mr. Miller in
1996, which options are not presently exercisable.
(3) Shares held jointly by Mr. Engle and his spouse.
(4) Shares held jointly by Mr. Lamborne and his spouse.
RATIFICATION OF INDEPENDENT AUDITORS
Unless instructed to the contrary, proxyholders intend to cast all votes
pursuant to proxies for ratification of the selection of Ernst & Young LLP as
the Corporation's independent auditors for the 1997 fiscal year. Ernst & Young
LLP advised the Corporation that none of its members has any financial interest
in the Corporation. Ratification of Ernst & Young LLP will require the
affirmative vote of a majority of the shares of Common Stock represented in
person or by proxy at the Annual Meeting. Ernst & Young LLP served as the
Corporation's independent auditors for the 1996 fiscal year, assisted the
Corporation and the Bank with preparation of their federal and state tax
returns, and provided assistance in connection with regulatory matters, charging
the Bank for such services at its customary hourly billing rates. These
non-audit services were approved by the Corporation's and the Bank's respective
Boards of Directors after due consideration of the effect of the performance
thereof on the independence of the auditors and after concluding that there was
no effect on the independence of the auditors.
In the event that the shareholders do not ratify the selection of Ernst &
Young LLP as the Corporation's independent auditors for the 1997 fiscal year,
another accounting firm may be chosen to provide independent audit services for
the 1997 fiscal year. The Board of Directors recommends that the shareholders
vote FOR the ratification of the selection of Ernst & Young LLP, as the
independent auditors for the Corporation for the year ending December 31, 1997.
13
ANNUAL REPORT
A copy of the Corporation's Annual Report for its fiscal year ended
December 31, 1996, is enclosed with this Proxy Statement. A representative of
Ernst & Young LLP, the accounting firm which examined the financial statements
in the Annual Report, will attend the meeting. The representative will have the
opportunity to make a statement, if he desires to do so, and will be available
to respond to any appropriate questions concerning the Annual Report presented
by shareholders at the Annual Meeting.
SHAREHOLDER PROPOSALS
Any shareholder who, in accordance with and subject to the provisions of
the proxy rules of the Securities and Exchange Commission, wishes to submit a
proposal for inclusion in the Corporation's Proxy Statement for its 1998 Annual
Meeting of Shareholders must deliver such proposal in writing to the President
of Codorus Valley Bancorp, Inc. at its principal executive offices, One
Manchester Street, Glen Rock, Pennsylvania 17327, not later than Thursday,
December 11, 1997.
OTHER MATTERS
The Board of Directors does not know of any matters to be presented for
consideration other than the matters described in the accompanying Notice of
Annual Meeting of Shareholders, but if any matters are properly presented, it is
the intention of the persons named in the accompanying Proxy to vote on such
matters in accordance with their best judgment.
ADDITIONAL INFORMATION
UPON WRITTEN REQUEST OF ANY SHAREHOLDER, A COPY OF THE CORPORATION'S REPORT
ON FORM 10-K FOR ITS FISCAL YEAR ENDED DECEMBER 31, 1996, INCLUDING THE
FINANCIAL STATEMENTS AND THE SCHEDULES THERETO, REQUIRED TO BE FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 13a-1 UNDER THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, MAY BE OBTAINED, WITHOUT CHARGE, FROM JANN
ALLEN WEAVER, ASSISTANT TREASURER, CODORUS VALLEY BANCORP, INC., ONE MANCHESTER
STREET, P.O. BOX 67, GLEN ROCK, PENNSYLVANIA 17327.
14
CODORUS VALLEY BANCORP, INC.
PROXY
/X/ PLEASE MARK VOTES
AS IN THIS EXAMPLE
With- For All
For hold Except
1. ELECTION OF CLASS A
DIRECTORS TO SERVE FOR / / / / / /
A THREE-YEAR TERM.
Rodney L. Krebs, Dallas L. Smith, George A. Trout
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
- -------------------------------------------------------------------------------
For Against Abstain
2. PROPOSAL TO RATIFY THE
SELECTION OF ERNST & YOUNG / / / / / /
LLP AS THE INDEPENDENT
AUDITORS FOR THE CORPORATION
FOR THE YEAR ENDING
DECEMBER 31, 1997.
The Board of Directors recommends a vote FOR this proposal.
- -------------------------------------------------------------------------------
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting and any adjournment or
postponement thereof.
THIS PROXY, WHEN PROPERLY SIGNED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR ALL NOMINEES LISTED ABOVE AND FOR PROPOSAL 2.
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 20, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Dallas L. Darr, Mildred L.
Lackey and George E. McCullough and each or any of them, proxies of the
undersigned, with full power of substitution, to vote all of the shares of
Codorus Valley Bancorp, Inc., (the "Corporation") that the undersigned may be
entitled to vote at the Annual Meeting of Shareholders of the Corporation to be
held at the Holiday Inn Holidome (at West Manchester Mall), Red & White Rose
Rooms, 2000 Loucks Road, York, Pennsylvania 17404, on Tuesday, May 20, 1997, at
10:00 a.m., prevailing time, and at any adjournment or postponement thereof as
follows:
Please be sure to sign and date Date
this Proxy in the box below.
Shareholder sign above -- Co-holder (if any) sign above
- --------------------------------------------------------------------------------
Detach above card, sign, date and mail in postage paid envelope provided.
Codorus Valley Bancorp, Inc.
THIS PROXY MUST BE DATED, SIGNED BY THE SHAREHOLDER AND RETURNED PROMPTLY
TO REGISTRAR & TRANSFER COMPANY IN THE ENCLOSED ENVELOPE. WHEN SIGNING AS
ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE GIVE FULL TITLE.
IF MORE THAN ONE TRUSTEE, ALL SHOULD SIGN. IF STOCK IS HELD JOINTLY, EACH OWNER
SHOULD SIGN.
[ LOGO ]
April 9, 1997
Dear Dividend Reinvestment and Stock Purchase Plan Participant:
As a participant in the Codorus Valley Bancorp, Inc. Dividend Reinvestment
and Stock Purchase Plan ("Plan"), you are entitled to instruct the Plan
Administrator, Registrar and Transfer Company, to vote the shares that are held
on your behalf in the Plan at the 1997 Annual Meeting of Shareholders of the
Corporation. To instruct the Plan Administrator as to how you would like these
shares voted at the Annual Meeting, please complete the enclosed Voting
Instruction Card/Proxy. At the Annual Meeting, in accordance with the Plan, the
Plan Administrator will vote the shares held in the Plan for which participants
have executed and returned a Voting Instruction Card/Proxy.
Enclosed is a copy of the Corporation's Notice of Annual Meeting and Proxy
Statement in connection with the 1997 Annual Meeting of Shareholders and a copy
of the Corporation's 1996 Annual Report. Also enclosed is a Voting Instruction
Card/Proxy which should be completed and returned to the Plan Administrator in
the enclosed envelope.
If you have any questions, please contact the undersigned.
Sincerely,
/s/ Larry J. Miller
------------------------------
Larry J. Miller, President and
Chief Executive Officer
Codorus Valley Bancorp, Inc.,
1 Manchester Street, P.O. Box 67, Glen Rock, PA 17327
- --------------------------------------------------------------------------------
DIVIDEND REINVESTMENT PLAN
VOTING INSTRUCTION CARD/PROXY
CODORUS VALLEY BANCORP, INC.
/X/ PLEASE MARK VOTES
AS IN THIS EXAMPLE
With- For All
For hold Except
1. ELECTION OF CLASS A
DIRECTORS TO SERVE FOR / / / / / /
A THREE-YEAR TERM.
Rodney L. Krebs, Dallas L. Smith, George A. Trout
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME ON THE SPACE PROVIDED BELOW.)
--------------------------------------------------------------------------
For Against Abstain
2. PROPOSAL TO RATIFY THE
SELECTION OF ERNST & YOUNG LLP / / / / / /
AS THE INDEPENDENT AUDITORS
FOR THE CORPORATION FOR THE
YEAR ENDING DECEMBER 31, 1997.
The Board of Directors recommends a vote FOR this proposal.
--------------------------------------------------------------------------
3. In its discretion, the proxy is authorized to vote upon such other business
as may properly come before the meeting and any adjournment or postponement
thereof.
THIS PROXY, WHEN PROPERLY SIGNED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
PARTICIPANT. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES
LISTED ABOVE AND FOR PROPOSAL 2.
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 20, 1997
The undersigned hereby constitutes and appoints Registrar and Transfer
Company, Plan Administrator for the Codorus Valley Bancorp, Inc. Dividend
Reinvestment and Stock Purchase Plan (the "Plan"), proxy of the undersigned,
with full power of substitution, to vote all of the shares of Codorus Valley
Bancorp, Inc. (the "Corporation") that the Plan holds on behalf of the
undersigned and may be entitled to vote at the Annual Meeting of Shareholders of
the Corporation to be held at the Holiday Inn Holidome (at West Manchester
Mall), Red & White Rose Rooms, 2000 Loucks Road, York, Pennsylvania 17404, on
Tuesday, May 20, 1997 at 10:00 a.m., prevailing time, and at any adjournment or
postponement thereof as follows:
Please be sure to sign and date Date
this Proxy in the box below.
Plan Participants sign above -- Co-holder (if any) sign above
- --------------------------------------------------------------------------------
Detach above card, sign, date and mail in postage paid envelope provided.
Codorus Valley Bancorp, Inc.
THE VOTING INSTRUCTIONS REQUEST PERTAINS TO SHARES OF COMMON STOCK HELD IN
YOUR DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN ACCOUNT BUT NOT REGISTERED IN
YOUR NAME. SUCH SHARES OF COMMON STOCK CAN BE VOTED ONLY BY THE PLAN
ADMINISTRATOR AS THE HOLDER OF RECORD OF THE SHARES.
PLEASE DATE, SIGN AND RETURN YOUR VOTING INSTRUCTION CARD/PROXY TO US
PROMPTLY IN THE RETURN ENVELOPE PROVIDED.