ITEM 1. Description of Business
Croghan Bancshares, Inc. (the "Corporation") was organized under the laws of the State of Ohio on September 27, 1983, and is registered as a bank holding company under the Bank Holding Company Act of 1956, as amended. The Corporation, as the result of a merger and reorganization effective in 1984, acquired all of the voting shares of The Croghan Colonial Bank (the "Bank"), an Ohio chartered bank organized in 1888. The Bank is the only subsidiary of the Corporation, and substantially all of the Corporation's operations are conducted through the Bank. The principal offices of both the Corporation and the Bank are located at 323 Croghan Street, Fremont, Ohio. The Bank also operates eight Ohio branch offices: two in Bellevue, one in Clyde, three in Fremont, one in Green Springs, and one in Monroeville. The Corporation and the Bank had total consolidated assets of $350,144,000 at December 31, 1998.
The Corporation, through its subsidiary, the Bank, operates in one industry segment, the commercial banking industry.
General
The Bank conducts a general banking business embracing the usual functions of commercial, retail, and savings banking, including time, savings, money market and demand deposits; commercial, industrial, agricultural, real estate, consumer installment and credit card lending; safe deposit box rental; automatic teller machines; trust department services; and other services tailored for individual customers. The Bank makes and services secured and unsecured loans to individuals, firms and corporations. The Bank makes direct loans to individuals and purchases installment obligations from retailers, both with and without recourse. The Bank makes a variety of residential, industrial, commercial and agricultural loans secured by real estate, including interim construction financing. Additionally, investment products bearing no FDIC insurance are offered through the Bank's Specialized Investment Division.
On a parent company only basis, the Corporation's only source of funds is the receipt of dividends paid by the Bank subsidiary. The ability of the Bank to pay dividends is subject to limitations under various laws and regulations, and to prudent and sound banking principles. Generally, subject to certain minimum capital requirements, the Bank may declare a dividend without the approval of the State of Ohio Division of Financial Institutions, unless the total of the dividends in a calendar year exceeds the total of its net profits for the year combined with its retained profits of the two preceding years. Management believes that the future earnings of the Bank will be sufficient to support anticipated asset growth at the Bank and at the same time provide funds to the Corporation to service debt and continue dividends at their current level.
On August 1, 1996, the Corporation acquired all of the outstanding shares of Union Bancshares Corp. ("Union"), the sole shareholder of The Union Bank and Savings Company, an Ohio banking corporation, for $20,227,000 cash plus $73,000 in acquisition costs pursuant to a Plan and Agreement of Reorganization dated February 15, 1996, and an Agreement of Merger dated March 27, 1996. The purchase price was deemed representative of the fair market value of Union and was subject to final adjustment based upon the results of an audit of Union's financial statements as of July 31, 1996. The Corporation funded the acquisition with internally-generated cash (primarily through the available undistributed income of the Bank) and with $4,500,000 borrowed from NBD Bank. The transaction was accounted for as a purchase with Union's assets and liabilities stated at their fair values. The fair values of the assets acquired totalled $102,276,000 and the fair values of the liabilities assumed totalled $91,545,000. Goodwill arising from the purchase of $9,569,000 is being amortized on a straight-line basis over a period of 15 years.
ITEM 1. Description of Business, Continued
Regulation and Supervision
The Corporation, as a registered bank holding company, is subject to regulation by the Board of Governors of the Federal Reserve System under the Bank Holding Company Act of 1956, as amended (the "Act"). The Act limits the activities in which the Corporation and the Bank may engage to those activities that the Federal Reserve Board finds, by order or regulation, to be so closely related to banking or managing or controlling banks as to be a proper incident thereto. A favorable determination by the Federal Reserve Board as to whether any such new activity by the Corporation or the Bank is in the public interest, taking into account both the likely adverse effects and the likely benefits, is also necessary before any such activity may be engaged in. A bank holding company is prohibited from acquiring direct or indirect ownership or control of any company that is not a bank or bank holding company unless its business and activities would be acceptable for the bank holding company itself. The Federal Reserve Board, however, is empowered to differentiate between activities which are initiated de novo by a bank holding company or a subsidiary and activities commenced by acquisition of a going concern. The Act also requires every bank holding company to obtain the prior approval of the Federal Reserve Board before acquiring all or substantially all of the assets of any bank, or acquiring ownership or control of any voting shares of any other bank, if after such acquisition, it would own or control such bank. In making such determinations, the Federal Reserve Board considers the effect of the acquisition on competition, the financial and managerial resources of the holding company and the convenience and needs of the affected communities.
The Federal Reserve Board possesses cease and desist powers over bank holding companies and their non-bank subsidiaries for activities that are deemed by the Board of Governors to constitute a serious risk to the financial safety, soundness or stability of a bank holding company, that are inconsistent with sound banking principles, or that are in violation of law. Further, under Section 106 of the 1970 Amendments to the Board's regulations, bank holding companies and their subsidiaries are prohibited from engaging in certain tie-in arrangements in connection with any extension of credit or lease or sale of any property or the furnishing of services.
The Bank, as an Ohio chartered bank, is supervised by the State of Ohio Division of Financial Institutions. The Bank is also a member of the Federal Reserve System and subject to its supervision. As such, the Bank is subject to periodic examinations by both the Ohio Division of Financial Institutions and the Federal Reserve Board. These examinations are designed primarily for the protection of the Bank's depositors and not for its shareholders. The Bank must file prescribed periodic reports with the Ohio Division of Financial Institutions containing a full and accurate statement of its affairs.
The Corporation and the Bank are subject to the Community Reinvestment Act of 1977, as amended (the "CRA"), which is designed to encourage financial institutions to give special attention to the needs of low and moderate income areas in meeting the credit needs of the communities in which they operate. If the CRA regulatory evaluation of a bank's activities is less than satisfactory, regulatory approval of proposed acquisitions, branch openings and other applications requiring Federal Reserve Board approval may be delayed until a satisfactory CRA evaluation is achieved. The Bank currently has a CRA regulatory evaluation of outstanding.
The Corporation and Bank are subject to various regulatory capital requirements administered by the federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Corporation's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt
ITEM 1. Description of Business, Continued
corrective action, the Corporation and Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Corporation and Bank to maintain minimum amounts and ratios of total and Tier I capital to risk-weighted assets, and of Tier I capital to average assets. Management believes that the Corporation and Bank meet all capital adequacy requirements to which they are subject.
The Corporation's only source of funds are dividends paid by the Bank. The ability of the Bank to pay dividends is subject to limitations under various laws and regulations, and to prudent and sound banking principles. Generally, subject to certain minimum capital requirements, the Bank may declare a dividend without the approval of the State of Ohio Division of Financial Institutions, unless the total dividends in a calendar year exceed the total of its net profits for the year combined with its retained profits of the two preceding years. The Board of Governors of the Federal Reserve System generally considers it to be an unsafe and unsound banking practice for a bank holding company to pay dividends except out of current operating income, although other factors such as overall capital adequacy and projected income may also be relevant in determining whether dividends should be paid.
Effects of Government Monetary Policy
The earnings of the Bank are affected by general and local economic conditions and by the policies of various governmental regulatory authorities. In particular, the Federal Reserve Board regulates money and credit conditions and interest rates in order to influence general economic conditions, primarily through open market acquisitions or dispositions of United States Government securities, varying the discount rate on member bank borrowings, and setting reserve requirements against member and nonmember bank deposits. Federal Reserve Board monetary policies have had a significant effect on the interest income and interest expense of commercial banks, including the Bank, and are expected to continue to do so in the future.
Competition
The Corporation's wholly-owned subsidiary, the Bank, has active competition in all areas in which it engages. The Bank competes for commercial and individual deposits and/or loans with other commercial banks in Huron, Sandusky, and Seneca counties in Northwestern Ohio, as well as with savings and loan associations in the trade area, credit unions, brokerage firms, mutual funds, and financial units of non-local bank holding companies. The Bank focuses on personalized service, convenience of facilities, pricing of products, community stature, and its local ownership and control in meeting its competition.
Employees
The Corporation has no employees and conducts its business through its wholly-owned subsidiary, the Bank.
As of December 31, 1998, the Bank employed 175 full-time employees and 31 part-time employees to whom it provides a variety of benefits and with whom it believes relationships are excellent.
The following pages present various statistical disclosures required for bank holding companies. The information represents only domestic information since the Corporation has no foreign operations or foreign loans.
ITEM 1. Description of Business, Continued
Distribution of Assets, Liabilities and Stockholders' Equity; Interest Rates and Interest Differential
The following table sets forth, for the years ended December 31, 1998, 1997 and 1996, the distribution of assets, liabilities and stockholders' equity, including interest amounts and average rates of major categories of interest-earning assets and interest-bearing liabilities:
(1) Included in loan interest income are loan fees of $446,556 in 1998, $422,894 in 1997, and $335,960 in 1996.
(2) Non-accrual loans are included in loan totals and do not have a material impact on the analysis presented.
ITEM 1. Description of Business, Continued
Changes in Interest Income and Interest Expense Resulting from Changes in Volume and Changes in Rate
The following table sets forth, for the periods indicated, a summary of the changes in interest income and interest expense resulting from changes in volume and changes in rate:
(1) The change in interest income and interest expense due to changes in both volume and rate, which cannot be segregated, has been allocated proportionately to the absolute dollar change due to volume and the change due to rate.
ITEM 1. Description of Business, Continued
Investment Portfolio
The following table sets forth the carrying amount of investment securities at December 31, 1998, 1997 and 1996:
(1) There are no investment securities of an "issuer" where the aggregate carrying value of such securities exceeded ten percent of stockholders' equity.
(2) All amounts are presented on the basis of Statement of Financial Accounting Standards No. 115.
The following table sets forth the maturities of investment securities at December 31, 1998 and the weighted average yields of such securities:
(1) Weighted average yields on non-taxable obligations have been computed on a fully tax-equivalent basis assuming a tax rate of 34%.
(2) Excludes equity investments of $2,137,000 which have no stated maturity.
ITEM 1. Description of Business, Continued
Loan Portfolio
Types of Loans
The amounts of gross loans outstanding at December 31, 1998, 1997, 1996, 1995 and 1994 are shown in the following table according to types of loans:
Commercial loans are those made for commercial, industrial, and professional purposes to sole proprietorships, partnerships, corporations, and other business enterprises. Financial loans are those made to banks, depository institutions, other associations and financial intermediaries whose business is to accept deposits and extend credit. Agricultural loans are for the purpose of financing agricultural production, including all costs associated with growing crops or raising livestock. These loans may be secured, other than by real estate, or unsecured, requiring one single repayment or on an installment repayment schedule. The loans involve certain risks relating to changes in local and national economic conditions and the resulting effect on the borrowing entities.
Real estate - mortgage loans are secured wholly or substantially by a lien on real property. Real estate - mortgage loans generally pose the least risk exposure to the Bank.
Real estate - construction loans are made to finance land development prior to erecting new structures and the construction of new buildings or additions to existing buildings. Real estate - construction loans pose more risk than real estate-mortgage loans, but generally afford adequate security upon completion of the construction project.
Consumer loans are made to individuals for household, family, and other personal expenditures. These often include the purchase of vehicles or furniture, educational expenses, medical expenses, taxes, or vacation expenses. Consumer loans may be secured, other than by real estate, or unsecured, generally requiring repayment on an installment repayment schedule. Consumer loans pose relatively higher risk and are also influenced by local and national economic conditions.
Credit card and other loans are made to individuals for personal expenditures and principally arise from bank credit cards. Such loans generally pose the most risk as they are most frequently unsecured.
There are no foreign loans and lease financing receivables, included in commercial, financial and agricultural, were $128,000 in 1998, $511,000 in 1997, and $515,000 in 1996 (none in years prior to 1996).
ITEM 1. Description of Business, Continued
Loan Portfolio
Maturities and Sensitivities of Loans to Changes in Interest Rates
The following table shows the amount of commercial, financial and agricultural loans outstanding as of December 31, 1998 which, based on the contract terms for repayments of principal, are due in the periods indicated. Also, the amounts due after one year are classified according to their sensitivity to changes in interest rates.
The above maturity information is based on the contract terms at December 31, 1998 and does not include any possible "rollover" at maturity date. In the normal course of business, the Bank considers and acts upon the borrower's request for renewal of a loan at maturity. Evaluation of such a request includes a review of the borrower's credit history, the collateral securing the loan, and the purpose for such request.
ITEM 1. Description of Business, Continued
Loan Portfolio
Risk Elements
The following table presents information concerning the amount of loans at December 31, 1998, 1997, 1996, 1995, and 1994 which contain certain risk elements:
(1) Loans are placed on nonaccrual status when, in the opinion of management, full collection of principal and interest is unlikely. Interest is then recognized on a cash basis where future collections of principal are probable. The amount of interest income that would have been recorded had all nonaccrual and renegotiated (of the type specified above) loans been current in accordance with their terms approximated $48,000 in 1998, $100,000 in 1997, $167,000 in 1996, $89,000 in 1995, and $77,000 in 1994. Actual interest included in income on these loans amounted to approximately $25,000 in 1998, $84,000 in 1997, $130,000 in 1996, $27,000 in 1995, and $16,000 in 1994.
(2) Excludes loans accounted for on a nonaccrual basis.
(3) Excludes loans accounted for on a nonaccrual basis and loans contractually past due 90 days or more as to principal or interest payments.
In addition to the loan amounts identified above, there were approximately $1,275,000 of potential problem loans at December 31, 1998, none of which relate to any concentrated risk elements common to all the loans. While these loans are all currently performing, management has some doubt about the ability of the borrowers to continue to comply with all of their present loan repayment terms.
As of December 31, 1998 there was no concentration of loans that exceeded 10% of total loans.
ITEM 1. Description of Business, Continued
Summary of Loan Loss Experience
Analysis of the Allowance for Loan Losses
The following table shows the daily average loan balances, for the periods indicated, and changes in the allowance for possible loan losses for such years:
(1) The determination of the balance of the allowance for loan losses is based upon an analysis of the loan portfolio and reflects an amount which, in management's judgment, is adequate to provide for possible loan losses. Such analysis is based on the character of the loan portfolio, current economic conditions, past loan loss experience, and such other factors as management believes require current recognition in estimating possible loan losses.
(2) The amount of charge-offs and recoveries fluctuates from year to year due to factors relating to the condition of the general economy and specific business segments. The 1994 charge-offs included one real estate-mortgage loan write-down of $116,946. The 1995 recoveries included one real estate-mortgage loan recovery of $63,465 and one commercial loan recovery of $122,700. The 1996 charge-offs included one real estate-construction loan write-off of $197,452 and the recoveries included a $186,769 recovery on the same loan. The 1997 real estate-mortgage recoveries included a $191,782 recovery. The 1998 charge-offs included one real estate-mortgage loan write-off of $57,836.
ITEM 1. Description of Business, Continued
Summary of Loan Loss Experience
Allocation of Allowance for Loan Losses
The following table allocates the allowance for loan losses for the periods indicated to each loan category. The allowance has been allocated to the categories of loans noted according to the amount deemed to be reasonably necessary to provide for the possibility of losses being incurred based on specific credit analyses and the proration of the unallocated allowance to the loan categories based on actual loss experience:
ITEM 1. Description of Business, Continued
Deposits
The average daily amount of deposits (all in domestic offices) and average rates paid on such deposits is summarized for the years 1998, 1997 and 1996 in the following table :
Maturities of time deposits of $100,000 or more outstanding at December 31, 1998 are summarized as follows (dollars in thousands):
Return on Equity and Assets
The ratio of net income to daily average total assets and average stockholders' equity, and certain other ratios, for the periods noted are as follows:
ITEM 2.
ITEM 2. Description of Property
The Corporation neither owns nor leases any properties. The Bank maintains its main office at 323 Croghan Street, Fremont, Ohio. In addition, the Bank operates two branch offices in Bellevue, one in Clyde, three in Fremont, one in Green Springs, and one in Monroeville. The Bank's operations center is also located in Fremont, Ohio. All of such premises are owned by the Bank, are in satisfactory condition, and are suitable for their intended use.
ITEM 3.
ITEM 3. Legal Proceedings
Corporation management is aware of no material pending or threatened litigation in which the Corporation or its subsidiary Bank faces potential loss or exposure which could materially affect the consolidated financial statements. The Corporation is not aware of any proceedings involving the Corporation that a governmental authority is contemplating.
ITEM 4.
ITEM 4. Submission of Matters to a Vote of Security Holders
No matter was submitted to a vote of shareholders, through the solicitation of proxies or otherwise, during the quarter ended December 31, 1998.
PART II
ITEM 5.
ITEM 5. Market for Registrant's Common Equity and Related Stockholder Matters
The number of holders of record of the Corporation's common stock at December 31, 1998 is 736.
Information relating to dividend restrictions is contained on pages 31 and 32 in Financial Statement Footnote No. 13 captioned "Regulatory Matters" of the 1998 Annual Report to Shareholders of Croghan Bancshares, Inc. and is incorporated herein by reference.
Other information required by this Item is contained on page 4 under the caption "Market Price and Dividends on Common Stock" of the 1998 Annual Report to Shareholders of Croghan Bancshares, Inc. and is incorporated herein by reference.
ITEM 6.
ITEM 6. Selected Financial Data
Information required by this Item is contained on page 5 under the caption "Five Year Summary of Selected Financial Data" of the 1998 Annual Report to Shareholders of Croghan Bancshares, Inc. and is incorporated herein by reference.
ITEM 7.
ITEM 7. Management's Discussion and Analysis
Information required by this Item is contained on pages 6 through 14 under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" of the 1998 Annual Report to Shareholders of Croghan Bancshares, Inc. and is incorporated herein by reference.
ITEM 7A.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk
Information required by this Item is contained on pages 12 and 13 under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations - Interest Rate Risk " of the 1998 Annual Report to Shareholders of Croghan Bancshares, Inc. and is incorporated herein by reference.
ITEM 8.
ITEM 8. Financial Statements and Supplementary Data
The following information required by this Item is contained on pages 15 through 35 in the 1998 Annual Report to Shareholders of Croghan Bancshares, Inc. and is incorporated herein by reference:
Independent Auditor's Report
Consolidated Balance Sheets - December 31, 1998 and 1997
Consolidated Statements of Operations - Years ended December 31, 1998, 1997 and 1996
Consolidated Statements of Stockholders' Equity - Years ended December 31, 1998, 1997 and 1996
Consolidated Statements of Cash Flows - Years ended December 31, 1998, 1997 and
Summary of Significant Accounting Policies
Notes to Consolidated Financial Statements
PART II
ITEM 9.
ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
There were no changes in or disagreements with accountants during the years ended December 31, 1998 or 1997.
PART III
ITEM 10.
ITEM 10. Directors and Executive Officers of the Registrant
Information concerning Directors and Executive Officers of the Corporation is contained on pages 2 and 3 under the caption "Election of Directors", and on pages 4 and 5 under the caption "Executive Officers" in the Corporation's Definitive Proxy Statement dated March 26, 1999, for the Annual Meeting of Shareholders to be held on May 11, 1999, and is incorporated herein by reference. Information concerning the failure of a director of the Corporation to comply with share beneficial ownership reporting requirements under Section 16(a) of the Securities Exchange Act of 1934, as amended, is contained on page 7 under the caption "Section 16(a) Beneficial Ownership Reporting Compliance" in the Corporation's Definitive Proxy Statement dated March 26, 1999, for the Annual Meeting of Shareholders to be held on May 11, 1999, and is incorporated herein by reference.
ITEM 11.
ITEM 11. Executive Compensation
Information concerning compensation of directors and executive compensation is contained on page 4 under the caption "Election of Directors", on pages 5 and 6 under the captions "Executive Compensation" and "Compensation Committee Report", and on page 6 under the caption "Performance Graph" in the Corporation's Definitive Proxy Statement dated March 26, 1999, for the Annual Meeting of Shareholders to be held on May 11, 1999, and is incorporated herein by reference.
ITEM 12.
ITEM 12. Security Ownership of Certain Beneficial Owners and Management
Information concerning security ownership of certain beneficial owners and management is contained on pages 1, 2, and 3 under the captions "Voting Securities and Principal Holders Thereof" and "Election of Directors" in the Corporation's Definitive Proxy Statement dated March 26, 1999, for the Annual Meeting of Shareholders to be held on May 11, 1999, and is incorporated herein by reference.
ITEM 13.
ITEM 13. Certain Relationships and Related Transactions
Information concerning related party transactions is contained on page 7 under the caption "Indebtedness Of and Transactions with Officers and Directors" in the Corporation's Definitive Proxy Statement dated March 26, 1999, for the Annual Meeting of Shareholders to be held on May 11, 1999, and is incorporated herein by reference.
PART IV
ITEM 14.
ITEM 14. (a) Exhibits and Financial Statement Schedules
The following financial statements are filed as a part of this report and are contained on pages 15 through 35 of Exhibit 13 (the 1998 Annual Report to Shareholders of Croghan Bancshares, Inc.):
Independent Auditor's Report Consolidated Balance Sheets - December 31, 1998 and 1997 Consolidated Statements of Operations - Years ended December 31, 1998, 1997 and 1996 Consolidated Statements of Stockholders' Equity - Years ended December 31, 1998, 1997 and 1996 Consolidated Statements of Cash Flows - Years ended December 31, 1998, 1997 and 1996 Summary of Significant Accounting Policies Notes to Consolidated Financial Statements
Financial statement schedules have been omitted because they are not applicable or because the required information is provided in the Consolidated Financial Statements, including the Notes thereto.
The following exhibits are filed with or incorporated by reference (in accordance with Item 601 of Regulation S-K) in this filing:
Reference to Prior Filing Regulation of Exhibit or of the S-K Exhibit Exhibit's Inclusion Number Document in this Filing
3(i) Amended Articles of Incorporation of Croghan (1) Bancshares, Inc.
3(ii) Code of Regulations of Croghan Bancshares, Inc. (2)
4.1 Certificate of Registrant's Common Stock (3)
4.2 Articles Fourth, Fifth and Eighth of (1) Registrant's Articles of Incorporation
4.3 Articles II, III, V, VII and VIII of (2) Registrant's Code of Regulations
13 Annual Report to Shareholders - 1998 Included with this filing
21 Subsidiaries of the Registrant Included with this filing
23 Consent of Independent Auditor Included with this filing
27 Financial Data Schedule Included with this filing
ITEM 14. (a) Exhibits and Financial Statement Schedules, continued
(1) This document was previously filed as Exhibit 3(i) to the Registrant's June 30, 1997 quarterly report on Form 10-QSB and is incorporated herein by reference.
(2) This document was previously filed as Exhibit 2 to the Registrant's Form 10 registration statement pursuant to Section 12(g) of the Securities Exchange Act of 1934 and is incorporated herein by reference.
(3) This document was previously filed as Exhibit 3 to the Registrant's Form 10 registration statement pursuant to Section 12(g) of the Securities Exchange Act of 1934 and is incorporated herein by reference.
ITEM 14. (b) Reports on Form 8-K
None were filed during the quarter ended December 31, 1998.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CROGHAN BANCSHARES, INC.
Date: March 9, 1999 /s/ Thomas F. Hite ------------- ------------------------- Thomas F. Hite, President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant in the capacities and on the date indicated:
/s/ Allan E. Mehlow /s/ Robert H. Moyer - --------------------------------- --------------------------------- Allan E. Mehlow, Treasurer/ Robert H. Moyer, Director Principal Financial Officer
/s/ Janet E. Burkett /s/ Albert C. Nichols - --------------------------------- --------------------------------- Janet E. Burkett, Director Albert C. Nichols, Director
/s/ Thomas F. Hite /s/ K. Brian Pugh - ---------------------------------- --------------------------------- Thomas F. Hite, Director/President K. Brian Pugh, Director
- --------------------------------- --------------------------------- John P. Keller, Director Clemens J. Szymanowski, Director
/s/ Stephen A. Kemper /s/ J. Terrence Wolfe - --------------------------------- --------------------------------- Stephen A. Kemper, Director J. Terrence Wolfe, Director
/s/ Daniel W. Lease - --------------------------------- --------------------------------- Daniel W. Lease, Director Claude E. Young, Director
Date: March 9, 1999 /s/ Gary L. Zimmerman - --------------------------------- --------------------------------- Gary L. Zimmerman, Director