Proxy
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1934
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|
(1) Amount
previously paid:
(2) Form,
Schedule or Registration Statement No.:
(3) Filing
Party:
(4) Date
Filed:
June 21,
2010
Dear
Stockholder:
You are cordially invited to attend the
annual meeting of stockholders of Riverview Bancorp, Inc. The meeting
will be held at the Riverview Center, 17205 S.E. Mill Plain Boulevard,
Vancouver, Washington, on Wednesday, July 21, 2010 at 10:00 a.m., local
time.
The Notice of Annual Meeting of
Stockholders and Proxy Statement appearing on the following pages describe the
formal business to be transacted at the meeting. During the meeting,
we will also report on our operations. Directors and officers, as
well as a representative of Deloitte & Touche LLP, our independent auditor,
will be present to respond to appropriate questions of
stockholders.
We would like to remind you of the
investment presentation by our trust company, Riverview Asset Management Corp.,
starting at 9:30 a.m. prior to the annual meeting of stockholders.
It is important that your shares are
represented at this meeting, whether or not you attend the meeting in person and
regardless of the number of shares you own. To make sure your shares
are represented, we urge you to complete and mail the enclosed proxy card or
vote over the Internet. If you attend the meeting, you may vote in
person even if you have previously voted.
We look forward to seeing you at the
meeting.
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Sincerely,
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/s/Patrick
Sheaffer
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Patrick
Sheaffer
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Chairman and
Chief Executive Officer
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RIVERVIEW
BANCORP, INC.
900
WASHINGTON STREET
SUITE
900
VANCOUVER,
WASHINGTON 98660
(360)
693-6650
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
TO
BE HELD ON JULY 21, 2010
Notice is hereby given that the annual
meeting of stockholders of Riverview Bancorp, Inc. will be held at the Riverview
Center, 17205 S.E. Mill Plain Boulevard, Vancouver, Washington, on Wednesday,
July 21, 2010, at 10:00 a.m., local time, for the following
purpose:
|
Proposal
1:
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To
elect three directors to each serve for a three-year
term.
|
We will also consider and act upon such
other matters as may properly come before the meeting or any adjournments or
postponements thereof. As of the date of this notice, we are not
aware of any other business to come before the meeting.
The Board of Directors has fixed the
close of business on May 24, 2010 as the record date for the annual
meeting. This means that stockholders of record at the close of
business on that date are entitled to receive notice of, and to vote at, the
meeting and any adjournment thereof.
To ensure that your shares are
represented at the meeting,
please take the time to vote by
signing, dating and mailing the enclosed proxy card which is solicited by the
Board
of Directors or
vote over the Internet using the voting procedures described on your proxy
card. The proxy will
not be used if you attend and vote at
the annual meeting in person. Regardless of the number of shares you
own,
your vote is very
important. Please act today.
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BY ORDER OF THE
BOARD OF DIRECTORS
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/s/Phyllis
Kreibich
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PHYLLIS
KREIBICH
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CORPORATE
SECRETARY
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Vancouver,
Washington
June 21,
2010
IMPORTANT: The prompt return of proxies
will save us the expense of further requests for proxies in order to ensure a
quorum at the meeting. A self-addressed envelope is enclosed for your
convenience. No postage is required if mailed in the United
States. Alternatively, you may vote over the Internet by following
the voting procedures and instructions on the proxy card.
OF
RIVERVIEW
BANCORP, INC.
900
WASHINGTON STREET
SUITE
900
VANCOUVER,
WASHINGTON 98660
(360)
693-6650
ANNUAL MEETING OF
STOCKHOLDERS
The Board of Directors of Riverview Bancorp, Inc. is using this Proxy Statement
to solicit proxies from our stockholders for use at the annual meeting of
stockholders. We are first mailing this Proxy Statement and the
enclosed form of proxy to our stockholders on or about June 21,
2010.
The information provided in this Proxy
Statement relates to Riverview Bancorp, Inc. and its wholly-owned subsidiary,
Riverview Community Bank. Riverview Bancorp, Inc. may also be
referred to as “Riverview” and Riverview Community Bank may also be referred to
as the “Bank.” References to “we,” “us” and “our” refer to Riverview
and, as the context requires, Riverview Community Bank.
INFORMATION ABOUT THE ANNUAL
MEETING
Our annual meeting will be held as
follows:
|
Date:
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Wednesday,
July 21, 2010
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Time:
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10:00
a.m., local time
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|
Place:
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Riverview
Center, located at 17205 S.E. Mill Plain Boulevard, Vancouver,
Washington
|
Matters
to Be Considered at the Annual Meeting
At the meeting, you will be asked to
consider and vote upon the following proposal:
|
Proposal
1.
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Election
of three directors to each serve for a three-year
term.
|
We also
will transact any other business that may properly come before the annual
meeting. As of the date of this proxy statement, we are not aware of
any other business to be presented for consideration at the annual meeting other
than the matters described in this proxy statement.
Important
Notice Regarding the Availability of Proxy Materials for the Annual Meeting of
Stockholders to Be Held on July 21, 2010
Our Proxy Statement and Annual Report
to Stockholders, are available at
www.snl.com/irweblinkx/docs.aspx?iid=1032031. The following materials
are available for review:
|
•
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Proxy
Statement;
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|
•
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proxy
card; and
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•
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Annual
Report to Stockholders.
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Directions
to attend the annual meeting, where you may vote in person, can be found online
at www.snl.com/irweblinkx/docs.aspx?iid=1032031.
Who
is Entitled to Vote?
We have fixed the close of business on
May 24, 2010 as the record date for stockholders entitled to
notice of
and to vote at our annual meeting. Only holders of record of
Riverview’s common stock on that date are entitled to
notice of
and to vote at the annual meeting. You are entitled to one vote for
each share of Riverview common stock you own, unless you own more than 10% of
Riverview’s outstanding shares. As provided in our Articles of
Incorporation, record holders of common stock who beneficially own in excess of
10% of Riverview’s outstanding shares are not entitled to any vote in respect of
the shares held in excess of the 10% limit. On May 24, 2010, there
were 10,923,773 shares of Riverview common stock outstanding and entitled to
vote at the annual meeting.
How
Do I Vote at the Annual Meeting?
Proxies are solicited to provide all
stockholders of record on the voting record date an opportunity to vote on
matters scheduled for the annual meeting and described in these
materials. You are a stockholder of record if your shares of
Riverview common stock are held in your name. If you are a beneficial
owner of Riverview common stock held by a broker, bank or other nominee (i.e.,
in “street name”), please see the instructions in the following
question.
Shares of Riverview common stock can
only be voted if the stockholder is present in person or by proxy at the annual
meeting. To ensure your representation at the annual meeting, we
recommend you vote by proxy even if you plan to attend the annual
meeting. You can always change your vote at the meeting if you are a
stockholder of record.
Voting instructions are included on
your proxy card. Shares of Riverview common stock represented by
properly executed proxies will be voted by the individuals named on the proxy
card in accordance with the stockholder’s instructions. Where
properly executed proxies are returned to us with no specific instruction as how
to vote at the annual meeting, the persons named in the proxy will vote the
shares “FOR” the election of each of our director nominees. If any
other matters are properly presented at the annual meeting for action, the
persons named in the enclosed proxy and acting thereunder will have the
discretion to vote on these matters in accordance with their best
judgment. We do not currently expect that any other matters will be
properly presented for action at the annual meeting.
You may receive more than one proxy
card depending on how your shares are held. For example, you may hold
some of your shares individually, some jointly with your spouse and some in
trust for your children. In this case, you will receive three
separate proxy cards to vote.
What
if My Shares Are Held in Street Name?
If you are the beneficial owner of
shares held in street name by a broker, your broker, as the record holder of the
shares, is required to vote the shares in accordance with your
instructions. If your common stock is held in street name, you will
receive instructions from your broker that you must follow in order to have your
shares voted. Your broker may allow you to deliver your voting
instructions via the telephone or the Internet. Please see the
instruction form that accompanies this Proxy Statement. If you do not
give instructions to your broker, your broker may nevertheless vote the shares
with respect to discretionary items, but will not be permitted to vote your
shares with respect to non-discretionary items, pursuant to current industry
practice. In the case of non-discretionary items, shares not voted
are treated as “broker non-votes.” The proposal to elect directors is
considered a non-discretionary item under the rules governing brokers that are
members of the New York Stock Exchange; therefore, you must provide instructions
to your broker in order to have your shares voted in the election of
directors.
If your shares are held in street name,
you will need proof of ownership to be admitted to the annual
meeting. A recent brokerage statement or letter from the record
holder of your shares are examples of proof of ownership. If you want
to vote your shares of common stock held in street name in person at the annual
meeting, you will have to get a written proxy in your name from the broker, bank
or other nominee who holds your shares.
How
Will My Shares of Common Stock Held in the Employee Stock Ownership Plan Be
Voted?
We maintain an employee stock ownership
plan (“ESOP”) for the benefit of our employees. Each ESOP participant
may instruct the ESOP trustee how to vote the shares of Riverview common stock
allocated to his or her account under the ESOP by completing the proxy card or
by voting over the Internet. If an ESOP participant properly executes
the proxy card or votes over the Internet, the ESOP trustee will vote the
participant’s shares in accordance with the participant’s
instructions. Unallocated shares of Riverview common stock held by
the ESOP and allocated shares for which no voting instructions are received will
be voted by the trustee in the same proportion as shares for which the
trustee
has received voting instructions. As of the close of business on the
voting record date, May 24, 2010, 490,698 shares have been allocated to
participants’ accounts. The trustees of the ESOP are Patrick
Sheaffer, Ronald A. Wysaske, John A. Karas and David A.
Dahlstrom.
How
Many Shares Must Be Present to Hold the Meeting?
A quorum must be present at the meeting
for any business to be conducted. The presence at the meeting, in
person or by proxy, of at least a majority of the shares of Riverview common
stock entitled to vote at the annual meeting as of the record date will
constitute a quorum. Proxies received but marked as abstentions will
be included in the calculation of the number of shares considered to be present
at the meeting.
What
if a Quorum Is Not Present at the Meeting?
If a quorum is not present at the
scheduled time of the meeting, a majority of the stockholders present or
represented by proxy may adjourn the meeting until a quorum is
present. The time and place of the adjourned meeting will be
announced at the time the adjournment is taken, and no other notice will be
given unless the meeting is adjourned for 120 days or more. An
adjournment will have no effect on the business that may be conducted at the
meeting.
Vote
Required to Approve Proposal 1: Election of Directors
Directors are elected by a plurality of
the votes cast, in person or by proxy, at the annual meeting by holders of
Riverview common stock. Accordingly, the three nominees for election
as directors who receive the highest number of votes actually cast will be
elected. Pursuant to our Articles of Incorporation, stockholders are
not permitted to cumulate their votes for the election of
directors. Votes may be cast for or withheld from each
nominee. Votes that are withheld will have no effect on the outcome
of the election because the nominee receiving the greatest number of votes will
be elected.
Our
Board of Directors unanimously recommends that you vote “FOR” the election of
each of its director nominees.
May
I Revoke My Proxy?
You may revoke your proxy before it is
voted by:
•
|
submitting
a new proxy with a later date;
|
•
|
notifying
the Corporate Secretary of Riverview in writing before the annual meeting
that you have revoked your proxy;
or
|
•
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voting
in person at the annual meeting.
|
If you plan to attend the annual
meeting and wish to vote in person, we will give you a ballot at the annual
meeting. However, if your shares are held in street name, you must
bring a validly executed proxy from the nominee indicating that you have the
right to vote your shares.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth, as of
May 24, 2010, the voting record date, information regarding share ownership
of:
•
|
those
persons or entities (or groups of affiliated persons or entities) known by
management to beneficially own more than five percent of Riverview’s
common stock other than directors and executive
officers;
|
•
|
each
director and director nominee of
Riverview;
|
•
|
each
executive officer of Riverview or Riverview Community Bank named in the
Summary Compensation Table appearing under “Executive Compensation” below
(known as “named executive officers”);
and
|
•
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all
current directors and executive officers of Riverview and Riverview
Community Bank as a group.
|
Persons
and groups who beneficially own in excess of five percent of Riverview’s common
stock are required to file with the Securities and Exchange Commission (“SEC”),
and provide a copy to us, reports disclosing their ownership pursuant to the
Securities Exchange Act of 1934. To our knowledge, no other person or
entity, other than those set forth below, beneficially owned more than five
percent of the outstanding shares of Riverview’s common stock as of the close of
business on the voting record date.
Beneficial ownership is determined in
accordance with the rules and regulations of the SEC. In accordance
with Rule 13d-3 of the Securities Exchange Act, a person is deemed to be the
beneficial owner of any shares of common stock if
he or she has voting
and/or investment power with respect to those shares. Therefore, the
table below includes shares owned by spouses, other immediate family members in
trust, shares held in retirement accounts or funds for the benefit of the named
individuals, and other forms of ownership, over which shares the persons named
in the table may possess voting and/or investment power. In addition,
in computing the number of shares beneficially owned by a person and the
percentage ownership of that person, shares of common stock subject to
outstanding options that are currently exercisable or exercisable within 60 days
after the voting record date are included in the number of shares beneficially
owned by the person and are deemed outstanding for the purpose of calculating
the person’s percentage ownership. These shares, however, are not
deemed outstanding for the purpose of computing the percentage ownership of any
other person.
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Number
of Shares
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|
|
Percent
of Shares
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|
Name
|
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Beneficially
Owned (1)
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|
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Outstanding
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Beneficial
Owners of More Than 5%
(Other
than Directors and Executive Officers)
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Riverview
Community Bank Employee Stock Ownership Plan Trust
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690,718
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6.32
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900
Washington Street, Suite 900
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Vancouver,
Washington 98660
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Dimensional
Fund Advisors LP (2)
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811,796
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7.43
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1299
Ocean Avenue, 11
th
Floor
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Santa
Monica, California 90401
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Directors
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Gary
R. Douglass
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56,304
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*
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Paul
L. Runyan
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277,253(3)
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2.54
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Edward
R. Geiger
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18,508(4)
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*
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Michael
D. Allen
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33,200(5)
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*
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Jerry
C. Olson
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19,151(6)
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*
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Gerald
L. Nies
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5,000(7)
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*
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Named
Executive Officers
|
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|
|
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Patrick
Sheaffer**
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634,624(8)
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5.81
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Ronald
A. Wysaske**
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196,800(9)
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1.80
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John
A. Karas
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71,572
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*
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David
A. Dahlstrom
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60,505
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*
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Kevin
J. Lycklama
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16,886
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*
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All
Executive Officers and Directors as a Group (12 persons)
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1,420,814
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13.01
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|
______________
*
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Less
than one percent of shares outstanding.
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**
|
Mr.
Sheaffer and Mr. Wysaske are also directors of
Riverview.
|
(1)
|
The
amounts shown include the following shares of common stock which the named
individuals have the right to acquire within 60 days of the voting record
date through the exercise of stock options granted pursuant to our stock
option plans: Mr. Douglass, 8,000 shares; Mr. Runyan, 8,000 shares; Mr.
Geiger, 8,000 shares; Mr. Allen, 8,000 shares; Mr. Olson, 6,000 shares;
Mr. Sheaffer, 16,000 shares; Mr. Wysaske, 16,000 shares; Mr. Karas, 16,000
shares; Mr. Dahlstrom, 36,000 shares; Mr. Lycklama, 3,000 shares; and all
Riverview executive officers and directors as a group, 143,000
shares.
|
|
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(Footnotes
continue on following page)
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(2)
|
Based
solely on a Schedule 13G/A filed with the SEC on February 8, 2010
reporting sole voting power with respect to 798,500 shares and sole
dispositive power with respect to 811,796 shares. Dimensional Fund
Advisors LP (“Dimensional”), an investment advisor registered under the
Investment Advisors Act of 1940, furnishes investment advice to four
investment companies and serves as investment manager to certain other
commingled group trusts and separate accounts (the “Funds”). In its role
as investment advisor, sub-adviser and/or manager, Dimensional possesses
investment and/or voting power over the securities of Riverview that are
owned by the Funds, and may be deemed to be the beneficial owner of these
shares; however, these securities are owned by the Funds. Dimensional
disclaims beneficial ownership of such securities.
|
(3)
|
Includes
232,443 shares held jointly with his wife.
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(4)
|
Includes
3,468 shares held jointly with his wife.
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(5)
|
Includes
400 shares held jointly with his wife.
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(6)
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Includes
5,151 shares held solely by his wife.
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(7)
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Held
jointly with his wife.
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(8)
|
Includes
13,910 shares held jointly with his wife and daughter
;
and 265,994 held jointly with his wife.
|
(9)
|
Includes
33,070 shares held jointly with his
wife.
|
PROPOSAL 1 – ELECTION OF DIRECTORS
Our Board of Directors currently
consists of eight members and is divided into three classes; however, Paul L.
Runyan will retire effective as of the annual meeting and the number of
directors will be reduced to seven. Approximately one-third of the
directors are elected annually to serve for a three-year period or until their
respective successors are elected and qualified. The table below sets
forth information regarding each director of Riverview and each nominee for
director. The Nominating Committee of the Board of Directors selects
nominees for election as directors. All of our nominees currently
serve as Riverview directors, with the exception of Gerald L. Nies, who was
appointed to the Board on September 23, 2009. Mr. Nies was
recommended by the Nominating Committee. Each nominee has consented
to being named in this Proxy Statement and has agreed to serve if
elected. If a nominee is unable to stand for election, the Board of
Directors may either reduce the number of directors to be elected or select a
substitute nominee. If a substitute nominee is selected, the proxy
holders will vote your shares for the substitute nominee, unless you have
withheld authority. At this time, we are not aware of any reason why
a nominee might be unable to serve if elected.
The Board of Directors recommends a
vote FOR the election of Ronald A. Wysaske, Michael D. Allen and Gerald L. Nies,
each for a three-year term.
|
|
Age
as of
|
|
Year
First Elected or
|
|
Term
to
|
Name
|
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March
31, 2010
|
|
Appointed
Director (1)
|
|
Expire
|
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BOARD
NOMINEES
|
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Ronald
A. Wysaske
|
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57
|
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1985
|
|
2013
(2)
|
Michael
D. Allen
|
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68
|
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2001
|
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2013
(2)
|
Gerald
L. Nies
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61
|
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2009
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|
2013
(2)
|
|
DIRECTORS
CONTINUING IN OFFICE
|
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Patrick
Sheaffer
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70
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1979
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2011
|
Edward
R. Geiger
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67
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1999
|
|
2011
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Jerry
C. Olson
|
|
68
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2007
|
|
2012
|
Gary
R. Douglass
|
|
68
|
|
1994
|
|
2012
|
______________
(1) For
years prior to 1998, includes service on the Board of Directors of Riverview
Community Bank.
(2) Assuming
the individual is elected or re-elected.
Set forth below is the principal
occupation of each nominee for director and each director continuing in office,
as well as a brief description of the qualifications, attributes, skills and
areas of expertise of each nominee or director that makes him uniquely qualified
to serve on Riverview’s Board of Directors. All nominees and
directors have held their present positions for at least five years unless
otherwise indicated.
Ronald A. Wysaske
joined
Riverview Community Bank in 1976. He became President and Chief
Operating Officer of the Bank and Riverview in February 2004. He has
been a member of the Board of Directors of the Bank since 1985, and Riverview
since its inception in 1997. Prior to his appointment as President
and Chief Operating Officer, he served as Executive Vice President, Treasurer
and Chief Financial Officer of the Bank since 1981 and of Riverview since its
inception. He is responsible for the daily operations and the
management of Riverview Community Bank. Mr. Wysaske holds a B.A. and
an M.B.A. from Washington State University, and is active in numerous
professional, educational and civic organizations. Mr. Wysaske’s
banking career gives him expertise in all areas of banking.
Michael D. Allen
is retired
after a 40-year career in the banking industry. Mr. Allen began his
career with Seattle First National Bank in 1964 and progressed through a number
of management positions, including serving as Vice President and Credit
Supervisor for Southwest Washington. From 1989 until 1998, Mr. Allen
served as Executive Vice President of Northwest National Bank, responsible for
commercial and retail banking operations. During that bank’s pending
acquisition by US Bank, Mr. Allen served as President from 1998 until
1999. He is a past board member of the Southwest Washington Private
Industry Council, Identity Clark County, the Vancouver Housing Authority and the
Community Housing Resource Center. Mr. Allen’s banking career gave
him expertise in all areas of banking.
Gerald L. Nies
is the
President and Chief Executive Officer of Nies Insurance Inc. He
attended Western Washington University and became a Chartered Property Casualty
Underwriter. Mr. Nies is a past Board member of the Washington
Independent Agents Association and past President of the National Agent Advisory
Council for Safeco Insurance. He also is one of the five Clark County
Emergency Medical Services Administrative Board members and a director for
Northwest Heart of Gold Inc., a Portland-based non-profit organization that
raises funds for cancer research at Oregon Health and Sciences
University. Mr. Nies served for five years as Fire Chief for the City
of Battle Ground and is a past President of the Battle Ground Chamber of
Commerce. Mr. Nies’ career has afforded him expertise in managing
financial and operational aspects of a business.
Patrick Sheaffer
joined
Riverview Community Bank in 1963 and has served as Chief Executive Officer since
1976. He became Chairman of the Board in 1993. He has been
Chairman of the Board and Chief Executive Officer of Riverview since its
inception in 1997. He is responsible for the daily operations and the
management of Riverview. Mr. Sheaffer is active in numerous
professional and civic organizations. Mr. Sheaffer’s banking career
gives him expertise in all areas of banking.
Edward R. Geiger
is a retired
business management and executive search consultant with over 45 years of
experience. Prior to establishing his consulting firm, Mr. Geiger was
Corporate Controller at Pacific Telecom, Inc. His prior experience
also includes three other Fortune 500 companies, municipal government and the
military. Mr. Geiger holds B.S. and M.B.A. degrees from Lehigh
University and is an inactive certified public accountant. He is an
active volunteer currently serving on the boards of directors of several
non-profit organizations. Mr. Geiger’s career gave him experience in
preparing budgets and financial statements, as well as general accounting
experience.
Jerry C. Olson
is President
and Chief Executive Officer of Olson Engineering, Inc. A graduate of
Oregon State University with a Masters in Forest Engineering, Mr. Olson holds
many professional designations including Professional Engineer, Professional
Land Surveyor, and Certified Forester. He is actively involved in
many regional and local organizations, including Responsible Growth Forum,
Engineering and Surveying Licensing Board, North Country EMS, Association of
Washington Business and the Clark College Business Advisory
Council. In addition, Mr. Olson has been on the Board of the Columbia
River Economic Development Council, The Building Industry of Clark County, and
the Commercial Real Estate Economic Coalition. Mr. Olson’s career has
given him strong leadership experience and knowledge of owning and operating a
long-established business.
Gary R. Douglass
is a retired
certified public accountant. Prior to his retirement, he had been in
private practice in Camas, Washington since 1978 and retired as a partner of
Douglass, Paulson & Lessard, CPAs, PC in April 2004. He serves on
the Board of Directors of Riverview Asset Management Corp. and serves on the
Management Committee of Orchard Hills Country Club. Mr. Douglass’
career gave him extensive experience in business and tax consulting for a wide
range of clients.
MEETINGS AND COMMITTEES OF THE BOARD OF
DIRECTORS
AND CORPORATE GOVERNANCE MATTERS
Board
of Directors
The Boards of Directors of Riverview
and Riverview Community Bank conduct their business through Board and committee
meetings. During the fiscal year ended March 31, 2010, the Riverview
Board of Directors held nine regular meetings and the Bank Board of Directors
held ten regular meetings. Neither Board held any special meetings
during the year ended March 31, 2010. No director attended fewer than
75% of the total meetings of the Boards and committees on which he served during
this period.
Committees
and Committee Charters
Riverview’s Board of Directors has
standing Audit and Nominating Committees. Riverview Community Bank’s
Board of Directors has standing Executive, Audit, Personnel/Compensation,
Compliance and Risk Management, Senior Loan and Nominating
Committees. Riverview’s Board of Directors does not have its own
compensation committee because Riverview has no
employees. Riverview’s Audit and Nominating Committees have adopted
written charters, copies of which are available on our website at
www.riverviewbank.com.
Committees
of the Riverview Board of Directors
The Executive Committee consists of
Directors Sheaffer (Chairman), Allen and Olson. This Committee meets
as necessary in between meetings of the full Board of Directors. The
Executive Committee met five times during the fiscal year ended March 31,
2010.
The Audit Committee consists of
Directors Geiger (Chairman), Olson and Runyan, and is responsible for developing
and monitoring the audit program. It also has the sole authority to
appoint or replace our independent auditor. The Committee meets with
the independent auditor to discuss the results of the annual audit and quarterly
procedures. The members of the Committee also receive and review all
the reports, findings and other information presented to them by the officers
regarding financial reporting policies and practices. Each member of
the Audit Committee is “independent,” in accordance with the requirements for
companies listed on The Nasdaq Stock Market LLC (“Nasdaq”). In
addition, Mr. Douglass has been designated by the Board of Directors as the
“audit committee financial expert,” as defined by the SEC. The Audit
Committee met six times during the fiscal year ended March 31,
2010.
The Nominating Committee consists of
Directors Runyan (Chairman), Douglass and Allen, and is responsible for
selecting nominees for the election of directors and developing a list of
nominees for Board vacancies. Each member of the Committee is
“independent,” in accordance with the requirements for companies quoted on The
Nasdaq Stock Market. The Committee met five times during the fiscal
year ended March 31, 2010.
Only those nominations made by the
Committee or properly presented by stockholders will be voted upon at the annual
meeting. In its deliberations for selecting candidates for nominees
as director, the Nominating Committee evaluates the qualifications of individual
candidates, including identifying the beneficial impact a candidate will have on
Riverview and the Board in terms of skill set, knowledge of the banking
business, the candidate’s independence, communication skills, education,
individual success in chosen fields, business development contributions,
character, expertise, experience and involvement in community, business and
civic affairs. The Committee also considers whether the candidate
would provide for adequate representation of the market area of Riverview
Community Bank. Any nominee for director made by the Committee
must be highly qualified with regard to some or all these
attributes. In searching for qualified director candidates to fill
vacancies in the Board, the Committee solicits its current Board of Directors
for names of potentially qualified candidates. Additionally, the
Committee may request that members of the Board of Directors pursue their own
business contacts for the names of potentially qualified
candidates. The Committee would then consider the potential pool of
director candidates, select the candidate the Committee believes best meets the
then-current needs of the Board, and conduct a thorough investigation of the
proposed candidate’s background to ensure there is no past history that would
cause the candidate not to be qualified to serve as a Riverview
director. The Committee will consider director candidates recommended
by our stockholders. If a stockholder submits a proposed nominee, the
Committee would consider the proposed nominee, along with any other
propo
sed
nominees recommended
by
members of our Board of Directors, in the same manner in which the Committee
would evaluate its nominees for director. For a description of the
proper procedure for stockholder nominations, see “Stockholder Proposals and
Nominations” in this Proxy Statement.
Director
Qualifications and Experience
As described in the previous paragraph,
the Nominating Committee considers a number of criteria when selecting new
members of the Board. The following table identifies the experience,
qualifications, attributes and skills that the Committee considered in making
its decision to nominate directors to our Board; however, the fact that a
particular attribute was not considered should not be construed to be a
determination that the director lacks such an attribute.
|
Allen
|
Douglass
|
|
Greiger
|
Nies
|
Olson
|
Runyan
|
|
Sheaffer
|
|
Wysaske
|
Experience,
Qualification, Skill or Attribute
|
|
|
|
|
|
|
|
|
|
|
|
Professional
standing in chosen field
|
X
|
X
|
|
X
|
X
|
X
|
X
|
|
X
|
|
X
|
Expertise
in financial services or related industry
|
X
|
|
|
|
|
|
|
|
X
|
|
X
|
Audit
Committee Financial Expert (actual or potential)
|
|
X
|
|
X
|
|
|
|
|
|
|
|
Civic
and community involvement
|
X
|
X
|
|
X
|
X
|
X
|
X
|
|
X
|
|
X
|
Other
public company experience
|
|
|
|
|
|
|
|
|
X
|
|
|
Leadership
and team building skills
|
X
|
X
|
|
X
|
X
|
X
|
X
|
|
X
|
|
X
|
Diversity
by race, gender or culture
|
|
|
|
|
|
|
|
|
|
|
|
Specific
skills/knowledge
|
|
|
|
|
|
|
|
|
|
|
|
Finance
|
|
X
|
|
X
|
|
|
|
|
|
|
X
|
Technology
|
|
|
|
|
X
|
|
|
|
|
|
|
Marketing
|
|
|
|
X
|
X
|
X
|
X
|
|
X
|
|
X
|
Public
affairs
|
X
|
|
|
|
X
|
X
|
|
|
X
|
|
X
|
Human
resources
|
|
X
|
|
X
|
X
|
X
|
X
|
|
X
|
|
X
|
Governance
|
X
|
X
|
|
|
X
|
X
|
|
|
X
|
|
X
|
Leadership
Structure
The positions of Chairman of the Board
and Chief Executive Officer are held by the same person. Michael D.
Allen serves as Vice-Chairman of the Board and lead independent
director. The lead independent director acts as the principal liaison
between the independent directors of the Board and the Chairman of the
Board. The lead independent director also leads the Board in the
absence of the Chairman of the Board. The Board rotates the position
of lead independent director amongst the outside directors on an annual
basis. The position of President of the Bank is held by separate
person. The Board believes this structure is appropriate for
Riverview because of the current Chief Executive Officer’s level of experience
and knowledge of Bank operations. This structure also allows the
President to focus on the day-to-day business of managing the Bank.
Board
Involvement in Risk Management Process
Risk management is the responsibility
of management and risk oversight is the responsibility of the
Board. The Board administers its risk oversight function principally
through the division of responsibility within its committee structure, with each
board committee being responsible for overseeing risk within its area of
responsibility. For example, our Risk Management Committee plays an
important role overseeing our internal audit function and is responsible for
reviewing significant reports prepared by the internal audit
department. Significant risk oversight matters considered by the
committees are reported to and considered by the Board. Some
significant risk oversight matters are reported directly to the Board, including
matters not falling within the area of responsibility of any
committee. Types of risk with the potential to adversely affect
Riverview include credit, interest rate, liquidity, compliance risks, and risks
relating to our operations and reputation.
Directors keep themselves informed of
the activities and condition of Riverview and of the risk environment in which
it operates by regularly attending Board and assigned Board committee meetings,
and by review of meeting materials, auditors’ findings and recommendations, and
supervisory communications. Directors stay abreast of general
industry trends and any statutory and regulatory developments pertinent to
Riverview and the Bank by periodic briefings by senior management, counsel,
auditors or other consultants, and by more formal director
education.
The Board oversees the conduct of
Riverview’s business and administers the risk management function
by:
•
|
Selecting,
evaluating, and retaining competent senior
management;
|
•
|
Establishing,
with senior management, Riverview’s long- and short-term business
objectives, and adopting operating policies to achieve these objectives in
a legal and sound manner;
|
•
|
Monitoring
operations to ensure that they are controlled adequately and are in
compliance with laws and policies;
|
•
|
Overseeing
Riverview’s business performance;
and
|
•
|
Ensuring
that the Bank helps to meet our communities’ credit
needs.
|
These
responsibilities are governed by a complex framework of federal and state law
and regulation as well as regulatory guidelines applicable to the operation of
Riverview and the Bank.
The Board ensures that all significant
risk-taking activities are covered by written policies that are communicated to
appropriate employees. Specific policies cover material credit,
market, liquidity, operational, legal and reputation risks. The
policies are formulated to further Riverview’s business plan in a manner
consistent with safe and sound practices. The Board ensures that all
such policies are monitored by senior management to make certain that they
conform with changes in laws and regulations, economic conditions, and
Riverview’s and the Bank’s circumstances. The policies are implemented by senior
management who develop and maintain procedures, including a system of internal
controls, designed to foster sound practices, to comply with laws and
regulations, and to protect Riverview against external crimes and internal fraud
and abuse. To assist Riverview with respect to risk management, and
to assist the Board and Board committees with respect to risk oversight, the
Bank employs a Vice President, Risk Manager, who works to identify and assess
risks in all areas of Riverview and the Bank. The Risk Manager
reports to the Audit Committee, attends meetings of the Audit and Risk
Management Committees on a regular basis, and attends Board and other committee
meetings as needed.
Management regularly provides the Board
and its various committees with a significant amount of information regarding a
wide variety of matters affecting Riverview. This includes senior
management reports to the Board. These reports present information in
a form meaningful to members of the Board, who recognize that the level of
detail and frequency of individual senior management reports will vary with the
nature of risk under consideration and Riverview’s and the Bank’s unique
circumstances. Matters presented to the Board and Board committees
generally include information with respect to risk. The Board and
Board committees consider the risk aspects of such information and often request
additional information with respect to issues that may involve risk to
Riverview. The Board and Board committees also raise risk issues on
their own initiative.
The Board has established a mechanism
for independent third party review and testing of compliance with policies and
procedures, applicable laws and regulations, and the accuracy of information
provided by senior management. This is accomplished, for example, by
an internal auditor reporting directly to the Audit Committee. In
addition, an external audit is performed. The Audit Committee reviews
the auditors’ findings with senior management and monitors senior management’s
efforts to resolve any identified issues and recommendations. The
Audit Committee provides regular reports of its activities to the
Board.
The Board also reviews reports of
inspection and examination or other supervisory activity, and any other material
correspondence received from Riverview’s regulators. Findings and
recommendations, if any, are carefully reviewed, and progress in addressing such
matters is routinely monitored.
Committees
of the Riverview Community Bank Board of Directors
The Executive Committee, which consists
of Directors Sheaffer (Chairman), Allen and Olson, meets as necessary in between
meetings of the full Board of Directors. This Committee met nine
times during the fiscal year ended March 31, 2010.
The Audit Committee consists of
Directors Geiger (Chairman), Olson and Runyan, and is responsible for developing
and monitoring the audit program. The Committee meets with the
independent auditor to discuss the results of the annual audit and quarterly
procedures. The members of the Committee also receive and review all
the reports, findings and other information presented to them by the officers
regarding financial reporting policies and practices. The Audit
Committee met six times during the fiscal year ended March 31,
2010.
The Personnel/Compensation Committee
consists of Directors Douglass (Chairman), Runyan and Geiger. This
Committee determines annual grade and salary levels for Riverview Community Bank
employees and establishes personnel policies. Each member of the
Personnel/Compensation Committee is “independent,” in accordance with the
requirements for companies listed on Nasdaq. The
Personnel/Compensation Committee met three times during the fiscal year ended
March 31, 2010.
The Risk Management Committee consists
of Directors Geiger (Chairman), Allen, Douglass, Olson, Runyan, Nies, Sheaffer
and Wysaske, and Don Sasaki, the Risk Manager of the Bank, who does not vote on
matters presented to the Committee. This Committee is responsible for
directing and monitoring the internal audit and compliance
programs. The Risk Management Committee met three times during the
fiscal year ended March 31, 2010.
The Senior Loan Committee consists of
Directors Sheaffer, Allen and Olson, and is chaired by Executive Vice President
David A. Dahlstrom, who does not vote on matters presented to the
Committee. The Committee reviews and approves all aggregate lending
relationships from $5 million to Riverview Community Bank’s internal loan
limit. The Senior Loan Committee met 15 times during the fiscal year
ended March 31, 2010.
The Nominating Committee consists of
Directors Runyan (Chairman), Douglass and Allen, and is responsible for
selecting nominees for the election of directors and developing a list of
nominees for Board vacancies. The Committee met five times during the
fiscal year ended March 31, 2010.
Corporate
Governance
We are committed to establishing and
maintaining high standards of corporate governance. The Board of
Directors is cognizant of its responsibility to comply with the provisions
contained in the Sarbanes-Oxley Act of 2002 and the rules and regulations of the
SEC adopted thereunder, as well as Nasdaq rules with respect to corporate
governance. The Board and its committees will continue to evaluate
and improve our corporate governance principles and policies as necessary and as
required.
Code of Ethics.
On
January 20, 2010, the Board of Directors revised the Officer and Director Code
of Ethics, that had originally been adopted December 17, 2003. The
Code is applicable to each of Riverview’s directors and officers, including the
principal executive officer and senior financial officers, and requires
individuals to maintain the highest standards of professional
conduct. A copy of the Code of Ethics is available on our website at
www.riverviewbank.com.
Communication with the Board of
Directors.
The Board of Directors maintains a process for
stockholders to communicate with the Board. Stockholders wishing to
communicate with the Board should send any communication to the Corporate
Secretary, Riverview Bancorp, Inc., 900 Washington Street, Suite 900, Vancouver,
Washington 98660. Any communication must state the number of shares
beneficially owned by the stockholder making the communication. The
Corporate Secretary will forward such communication to the full Board of
Directors or to any individual director or directors to whom the communication
is directed unless the communication is unduly hostile, threatening, illegal or
similarly inappropriate, in which case the Corporate Secretary has the authority
to discard the communication or take appropriate legal action.
Annual Meeting Attendance by
Directors.
We do not have a policy regarding Board member
attendance at annual meetings of stockholders. All then-members of
the Board of Directors, except Mr. Geiger, attended the 2009 annual meeting of
stockholders.
Related Party
Transactions.
Federal regulations require that all loans or
extensions of credit to executive officers and directors must be made on
substantially the same terms, including interest rates and collateral, as those
prevailing
at the time for comparable transactions with other persons (unless the loan or
extension of credit is made under a benefit program generally available to all
other employees and does not give preference to any insider over any other
employee) and does not involve more than the normal risk of repayment or present
other unfavorable features. Riverview Community Bank is therefore
prohibited from making any new loans or extensions of credit to its executive
officers and directors at different rates or terms than those offered to the
general public and has adopted a policy to this effect. The aggregate
amount of loans by the Bank to its executive officers and directors was
approximately $1.4 million at March 31, 2010. These loans (i) were
made in the ordinary course of business, (ii) were made on substantially the
same terms and conditions, including interest rates and collateral, as those
prevailing at the time for comparable transactions with the Bank’s other
customers and (iii) did not involve more than the normal risk of collectibility
or present other unfavorable features when made. Loans in amounts up
to $15.2 million are granted pursuant to Riverview Community Bank’s normal
approval procedures. All loans and aggregate loans to individual
directors and executive officers are required to be reviewed by the Executive
Committee and reported to the Board.
All loan approval and
review procedures are governed by written policies.
Director
Independence.
Our common stock is listed on the Nasdaq Global
Select Market. In accordance with Nasdaq requirements, at least a
majority of our directors must be independent directors. The Board
has determined that six of our eight directors are independent, as defined by
Nasdaq. Messrs. Allen, Douglass, Geiger, Olson, Runyan and Nies are
all independent. Only Patrick Sheaffer, who is our Chairman and Chief
Executive Officer, and Ronald A. Wysaske, who is our President and Chief
Operating Officer, are not independent.
The following table shows the compensation paid to our non-employee directors
for the fiscal year ended March 31, 2010. Compensation for
Directors Patrick Sheaffer and Ronald A. Wysaske, who are employees of Riverview
Community Bank, is included in the section entitled “Executive
Compensation.” Our non-employee directors did not receive any stock
awards or non-equity incentive plan compensation; therefore, these columns have
been omitted from the table below.
Name
|
|
Fees
Earned or
Paid
in Cash ($)
|
|
Option
Awards
($)(1)
|
|
Change
in
Pension
Value
and
Nonqualified
Deferred
Compensation
Earnings
($)(2)
|
|
All
Other
Compensation
($)(3)
|
|
Total
($)
|
|
|
|
|
|
|
|
|
|
|
|
Paul
L. Runyan
|
|
24,000
|
|
6,150
|
|
6,112
|
|
193
|
|
36,455
|
Gary
R. Douglass
|
|
22,250
|
|
6,150
|
|
--
|
|
193
|
|
28,593
|
Edward
R. Geiger
|
|
15,250
|
|
6,150
|
|
--
|
|
193
|
|
21,593
|
Michael
D. Allen
|
|
20,500
|
|
6,150
|
|
--
|
|
193
|
|
26,843
|
Jerry
C. Olson
|
|
18,750
|
|
6,150
|
|
--
|
|
193
|
|
25,093
|
Gerald
L. Nies (4)
|
|
10,750
|
|
11,600
|
|
--
|
|
193
|
|
22,543
|
|
|
|
|
|
|
|
|
|
|
|
____________
(1)
|
Represents
the aggregate grant date fair value, computed in accordance with Financial
Accounting Standards Board Accounting Standards Topic 718, “Compensation -
Stock Compensation” (“FASB ASC Topic 718”). For a discussion of valuation
assumptions, see Note 14 of the Notes to Consolidated Financial Statements
in Riverview’s Annual Report on Form 10-K for the year ended March 31,
2010. The non-employee directors had the following option
awards outstanding at March 31, 2010: Messrs. Runyan, Douglass, Geiger and
Allen, 13,000 shares each; Mr. Olson, 15,000 shares; and Mr. Nies, 10,000
shares.
|
(2)
|
Consists
of above-market earnings on balances in the nonqualified deferred
compensation plan; calculated based on the earnings adjustment in excess
of 120 percent of the applicable federal long-term rate in effect on
January 1
st
of each year.
|
(3)
|
Consists
of a small gift to directors.
|
(4)
|
Mr.
Nies was appointed to the Board effective as of September 23,
2009.
|
Directors receive an annual retainer of
$5,000 and a fee of $1,000 for each Board meeting attended. Outside
directors also receive $250 for each committee meeting attended. The
Personnel/Compensation Committee recommends
to the
Board of Directors the amount of fees paid for service on the
Board. During the fiscal year ended March 31, 2010, there were no
increases in Board or committee meeting fees.
Riverview Community Bank adopted a
non-qualified deferred compensation plan in 1986 which permits directors to
elect to defer their retainer and monthly fees until retirement with no income
tax payable by the director until retirement benefits are
received. We credit an earnings adjustment on assets under the plan
based on the rate of the Bank’s average yield in assets for the prior year, less
100 basis points. For the calendar year ended December 31, 2009, this
crediting rate was 6.19%. Under the current version of the plan, when
the participant ceases to be a director, we will pay the director or his
designated beneficiaries his plan benefit in a lump sum or in annual
installments over ten years, as elected by the director. This
election is made at the same time the director makes his compensation deferral
election. The payment will be based on an amount equal to the balance
in the director’s account immediately before the date on which benefits
commence, plus interest on the unpaid balance if the payment is made in
installments. Payments shall commence upon the first day of the
second year following the year in which the participant ceases to be a director,
unless the committee administering the plan elects to commence payment earlier,
and earlier payment is permitted by law. Payments may also be on
account of hardship, as defined under the plan. The estimated
liability under the plan is accrued as earned by the director. At
March 31, 2010, our aggregate liability under the plan for directors was
$440,000.
Compensation
Discussion and Analysis
Personnel/Compensation
Committee.
Because Riverview does not have its own employees,
the Personnel/Compensation Committee of Riverview Community Bank is responsible
for establishing and monitoring compensation policies, and for evaluating
performance and setting salaries. The Committee is responsible for
evaluating the performance of our Chief Executive Officer, while the Chief
Executive Officer evaluates the performance of other senior officers of the Bank
and makes recommendations to the Committee regarding compensation
levels.
Objectives and Overview of the
Compensation Program.
Our executive compensation policies are
designed to establish an appropriate relationship between executive pay and the
annual and long-term performance of Riverview and Riverview Community Bank, to
reflect the attainment of short- and long-term financial performance goals, to
enhance our ability to attract and retain qualified executive officers, and to
align to the greatest extent possible the interests of management and
stockholders. The principles underlying the executive compensation
policies include the following:
•
|
to
attract and retain key executives who are vital to our long-term success
and are of the highest caliber;
|
•
|
to
provide levels of compensation competitive with those offered throughout
the financial industry and consistent with our level of
performance;
|
•
|
to
motivate executives to enhance long-term stockholder value by building
their equity interest in Riverview;
and
|
•
|
to
integrate the compensation program with our annual and long-term strategic
planning and performance measurement
processes.
|
The Committee considers a variety of
subjective and objective factors in determining the compensation package for
individual executives, including: (1) the performance of Riverview and Riverview
Community Bank as a whole, with emphasis on annual performance factors and
long-term objectives; (2) the responsibilities assigned to each executive; and
(3) the performance of each executive of assigned responsibilities as measured
by our progress during the year.
Compensation Program
Elements.
The Personnel/Compensation Committee focuses
primarily on the following four components in forming the total compensation
program for our executive officers: base salary; incentive compensation;
deferred compensation; and long-term incentive compensation. The
current compensation plans involve
a
combination of salary and incentive compensation to reward short-term
performance, and deferred compensation and stock option grants to reward
long-term performance.
Base
Salary
.
The purpose of
base salary is to create a secure base of cash compensation for our employees.
Salary levels are designed to be competitive within the banking and financial
services industries. In setting competitive salary levels, the
Personnel/Compensation Committee regularly evaluates current salary levels by
surveying similar institutions in Washington, Oregon and the
Northwest. The survey analysis focuses primarily on asset size,
nature of ownership, type of operation and other common
factors. Specifically, the Committee annually reviews the Northwest
Financial Industry Salary Survey prepared by Milliman USA in association with
the Washington Bankers Association, the Washington Financial League and the
Oregon Bankers Association, covering 98 Northwest financial organizations, and
the Portland Area Cross-Industry Survey prepared by Milliman USA, which covers
81 major local employers, representing 160,000 workers. We analyze
the results of the surveys by position, and the midpoint of each position/grade,
as it compares to Riverview Community Bank. Midpoints of each grade
for Riverview are compared to midpoints of survey data to determine if grade
adjustments are necessary to remain competitive. In the past, we have
used the services of Watson Wyatt to assist in the development of salary and
incentive compensation programs; however, the Compensation Committee has not
engaged a compensation consultant in the last several years.
Incentive
Compensation Program
.
We believe it is
appropriate to provide individuals who are responsible for managing existing
business and/or generating new business with competitive incentive compensation
opportunities. Our incentive compensation plan is designed to provide
for incentive compensation with established targets of 40% of salary for the
Chief Executive Officer, 50% of salary for the Chief Operating Officer, 35% to
45% of salary for executive vice presidents and 15% to 35% of salary for senior
management. Certain other officers may participate in the plan at a
level of 10% to 30% of salary. By rewarding goals, we truly utilize
incentive for growth and are competitive in the marketplace. We may
utilize the services of compensation consultants, as needed, to remain fair and
competitive in the future.
The Personnel/Compensation Committee
approves goals and incentive participation each year. Individual
participant goals and performance modifier targets are communicated to
participants in writing in the first quarter of the fiscal year to which the
goals apply. Goals are measured against performance after the end of
the fiscal year. Results are communicated the month following
year-end for each participant. The performance modifier ranges from
zero to a maximum of two times the salary at risk percentage. In
making awards under the incentive compensation plan, the Personnel/Compensation
Committee, the Chief Operating Officer and Chief Executive Officer or executive
officers, as appropriate, review quantifiable data versus a plan approved by the
Board. The plan also provides for subjective evaluation of
performance by the Committee, the Chief Operating Officer and Chief Executive
Officer or executive officers, as appropriate.
Currently, performance measures include
financial objectives such as profitability, credit quality, deposit growth and
capital. Participant salaries are recorded, with specific goals tied
to Riverview Community Bank’s goals for the year, and a percentage of
compensation is noted as “salary at risk.” For example, if the Chief
Executive Officer’s salary is $235,937 per year with a 40% salary at risk
factor, the opportunity for salary at risk compensation is $94,375 if goals are
met at 100%. The salary at risk is divided into several goals based
on annual goals of Riverview and Riverview Community Bank. A
performance modifier is used to determine the percentage of the goal
met. A goal partially met at 88% with a weight factor of 25% of
salary at risk would look like this:
$235,937 x 40% salary at risk =
$94,375
Goal
Weight
|
|
Performance
Modifier
|
|
Result
|
|
0.25
|
|
0.88
|
|
0.22
|
|
Performance goals are assessed annually
and paid following the fiscal year end. For the fiscal year ended
March 31, 2010, the performance goals for the named executive officers, with the
exception of John A. Karas, consisted of profit, credit quality, deposit growth
and capital adequacy, each of which was weighted at 25%. The actual
financial
targets
were profit of $1 million, reduction in classified assets of 15%, deposit growth
of $24 million and a total risk-based capital ratio of 12%. Mr.
Karas, who is the President and Chief Executive Officer of Riverview Asset
Management Corp., typically has goals based on the performance of Riverview
Asset Management Corp. His 2010 goals were before tax profit of
$500,000 (weighted at 20%), asset growth of 11% (weighted at 20%), minimum
regulatory rating (weighted at 25%), deposit growth at the Bank of $24 million
(weighted at 10%), and individual goals consisting of reduction in operating
expense, increase in tax and hourly revenue and implementation of new collateral
material (collectively weighted at 25%). For all of the named
executive officers, the goals had performance modifiers that ranged from zero to
two times salary at risk. For the year ended March 31, 2010, Messrs.
Sheaffer, Dahlstrom and Lycklama were eligible to earn an incentive of up to 40%
of their base salary and Messrs. Wysaske and Karas were eligible to earn an
incentive of up to 50% of their base salary.
Incentive compensation is only awarded
if Riverview achieves a minimum level of overall performance (measured by net
income and capital adequacy), regardless of whether other individual performance
goals were achieved. For 2010, the minimum levels of achievement were
net income of at least $1 million and total risk-based capital of 12%. Because
Riverview did not achieve its 2010 net income goal, no incentive compensation
was paid to the named executive officers.
Deferred
Compensation.
Officers at the level of senior vice president
and above may elect to defer up to 50% of salary and bonus until retirement,
with no income tax payable by the officer until retirement benefits are
received. This alternative is available through the non-qualified
deferred compensation plan described below in the section entitled “Nonqualified
Deferred Compensation.”
Long Term
Incentive Compensation.
In connection with Riverview Community
Bank’s reorganization into the holding company structure, the Board of Directors
adopted the 1998 Stock Option Plan for executive officers, employees and
non-employee directors. This plan was approved by Riverview’s
stockholders. The Board of Directors also adopted the 2003 Stock
Option Plan, which was approved by stockholders at the 2003 annual meeting of
stockholders. Under the plans, non-employee directors, executive
officers and other employees may receive grants of stock options, although no
further options may be granted under the 1998 Stock Option Plan. We
believe that stock ownership by our executives is a significant factor in
aligning the interests of the executives with those of
stockholders. Stock option awards are allocated based upon regulatory
practices and policies, and the practices of other publicly traded financial
institutions as verified by external surveys and are based upon the executive
officers’ level of responsibility and contributions to Riverview and Riverview
Community Bank.
Stock ownership is also enhanced
through participation in our ESOP, under which eligible employees receive an
allocation of Riverview stock based on a percentage of eligible
wages. The Board of Directors has appointed an administrative
committee of Riverview officers to administer the ESOP and the 401(k) plan, and
the named executive officers participate in both of these plans. On an annual
basis, Riverview allocates shares to the ESOP, which applies to all eligible
participants including the named executive officers. In fiscal year 2010,
Riverview contributed 24,633 shares into the ESOP on behalf of eligible
participants, and matched the first four percent of participants’ contributions
into the 401(k) plan each payroll period.
Allocation of
Compensation.
We do not have any specific policies regarding
allocation of total compensation between short-term and long-term elements, or
cash and non-cash elements. For the year ended March 31, 2010, the composition
of total compensation for our named executive officers was as
follows:
Type
of Compensation
|
|
Percentage
of Total
Compensation
|
|
|
|
|
|
Base
salary
|
|
83.6
|
|
Incentive
compensation
|
|
--
|
|
Deferred
compensation earnings
|
|
1.5
|
|
Long-term
incentive and other compensation
|
|
14.9
|
|
Personnel/Compensation
Committee Report
The Personnel/Compensation Committee of
Riverview Community Bank’s Board of Directors has submitted the following report
for inclusion in this Proxy Statement:
We have reviewed and discussed the
Compensation Discussion and Analysis contained in this Proxy Statement with
management. Based on the Committee’s review of and the discussion
with management with respect to the Compensation Discussion and Analysis, we
recommended to the Board of Directors that the Compensation Discussion and
Analysis be included in this Proxy Statement.
The foregoing report is provided by the
following directors, who constitute the Personnel/Compensation
Committee:
|
Personnel/Compensation
Committee
|
|
|
|
Gary
R. Douglass, Chairman
|
|
Edward
R. Geiger
|
|
Jerry
C. Olson
|
This
report shall not be deemed to be incorporated by reference by any general
statement incorporating by reference this proxy statement into any filing under
the Securities Act of 1933 or the Securities Exchange Act of 1934, and shall not
otherwise be deemed filed under such acts.
Compensation
Policies and Risk
Riverview develops and implements
compensation plans that provide strategic direction to each participant and
engages him or her in Riverview’s success, which contributes to shareholder
value. We believe our approach to goal setting, establishing targets
with payouts at multiple levels of performance and evaluation of performance
results help to mitigate excessive risk taking that could harm Riverview’s value
or reward poor judgment by our executives. Performance incentive rewards for all
plans continue to be focused on results that impact earnings, profitability,
credit quality, deposit growth and capital adequacy.
All members of the Compensation
Committee are aware of Riverview’s financial performance and they use this
information when reviewing and approving incentive payouts to our named
executive officers. The Compensation Committee reviewed the incentive
compensation plans and concluded that the compensation plans do not encourage
unnecessary or excessive risk and that management and the Board have effective
controls in place utilizing outside auditors, internal auditors and Board
oversight to ensure adequate controls are in place to mitigate risk within
Riverview.
Summary
Compensation Table
The following table shows information
regarding compensation earned during the fiscal year ended March 31, 2010 for
our named executive officers: (1) Patrick Sheaffer, our principal executive
officer; (2) Kevin J. Lycklama, our principal financial officer; and (3) our
three other most highly compensated executive officers, who are Ronald A.
Wysaske, John A. Karas and David A. Dahlstrom. We did not pay any
bonuses in fiscal year 2010, nor do the named executive officers have any
restricted stock awards outstanding; therefore, these columns have been omitted
from the table below.
Name
and Principal Position
|
|
Year
|
|
Salary
($)
|
|
Option
Awards
($)(1)
|
|
Non-Equity
Incentive
Plan
Compen-
sation
($)
|
|
Change
in
Pension
Value
and
Non-
qualified
Deferred
Compen-
sation
Earnings
($)(2)
|
|
All
Other
Compen-
sation
($)(3)
|
|
Total
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Patrick
Sheaffer
|
|
2010
|
|
263,884
|
|
14,760
|
|
--
|
|
7,672
|
|
37,772
|
|
324,088
|
Chairman
and Chief Executive
|
|
2009
|
|
263,884
|
|
--
|
|
--
|
|
11,120
|
|
37,998
|
|
313,002
|
Officer
|
|
2008
|
|
250,020
|
|
--
|
|
48,495
|
|
8,979
|
|
42,968
|
|
350,462
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronald
A. Wysaske
|
|
2010
|
|
249,232
|
|
14,760
|
|
--
|
|
7,819
|
|
33,043
|
|
304,854
|
President
and Chief Operating
|
|
2009
|
|
229,707
|
|
--
|
|
--
|
|
10,243
|
|
33,730
|
|
273,680
|
Officer
|
|
2008
|
|
219,119
|
|
--
|
|
54,106
|
|
8,236
|
|
36,911
|
|
318,372
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John
A. Karas
|
|
2010
|
|
172,996
|
|
14,760
|
|
--
|
|
595
|
|
17,447
|
|
205,798
|
Executive
Vice President and
|
|
2009
|
|
168,843
|
|
--
|
|
--
|
|
677
|
|
20,582
|
|
190,102
|
President
and Chief Executive
|
|
2008
|
|
161,090
|
|
--
|
|
87,957
|
|
431
|
|
23,373
|
|
272,851
|
Officer
of Riverview Asset
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management
Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
David
A. Dahlstrom
|
|
2010
|
|
172,501
|
|
14,760
|
|
--
|
|
1,721
|
|
10,024
|
|
199,006
|
Executive
Vice President and
|
|
2009
|
|
168,358
|
|
--
|
|
--
|
|
2,003
|
|
11,144
|
|
181,505
|
Chief
Credit Officer
|
|
2008
|
|
160,628
|
|
--
|
|
30,526
|
|
1,377
|
|
15,200
|
|
207,731
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kevin
J. Lycklama
|
|
2010
|
|
135,601
|
|
14,760
|
|
--
|
|
301
|
|
5,780
|
|
156,442
|
Senior
Vice President and
|
|
2009
|
|
115,477
|
|
--
|
|
--
|
|
159
|
|
5,594
|
|
121,230
|
Chief
Financial Officer
|
|
2008
|
|
94,653
|
|
6,800
|
|
5,516
|
|
2
|
|
5,646
|
|
112,617
|
______________
(1)
|
Represents
the aggregate grant date fair value, computed in accordance with FASB ASC
Topic 718. For a discussion of valuation assumptions, see Note 14 of the
Notes to Consolidated Financial Statements in Riverview’s Annual Report on
Form 10-K for the year ended March 31, 2010.
|
(2)
|
Consists
of above-market earnings on balances in the nonqualified deferred
compensation plan; calculated based on the earnings adjustment in excess
of 120 percent of the applicable federal long-term rate in effect on
January 1
st
of each year.
|
(3)
|
Please
see the table below for more information on the other compensation paid to
our named executive officers in the year ended March 31,
2010.
|
All Other
Compensation.
The following table sets forth details of “All
other compensation,” as presented above in the Summary Compensation
Table. The amounts reflected constitute contributions by Riverview
Community Bank.
Name
|
|
ESOP
Contribution
($)
|
|
401(k)
Plan Contribution
($)
|
|
Life
Insurance
Premium
($)
|
|
Company
Car Allowance ($)
|
|
Board
Fees
($)
|
|
Total
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Patrick
Sheaffer
|
|
1,334
|
|
7,240
|
|
6,798
|
|
8,400
|
|
14,000
|
|
37,772
|
Ronald
A. Wysaske
|
|
1,286
|
|
9,241
|
|
2,516
|
|
6,000
|
|
14,000
|
|
33,043
|
John
A. Karas
|
|
916
|
|
6,670
|
|
3,861
|
|
6,000
|
|
--
|
|
17,447
|
David
A. Dahlstrom
|
|
848
|
|
6,350
|
|
2,826
|
|
--
|
|
--
|
|
10,024
|
Kevin
J. Lycklama
|
|
629
|
|
4,802
|
|
349
|
|
--
|
|
--
|
|
5,780
|
Employment and Severance
Agreements.
We entered into employment agreements with Messrs.
Sheaffer, Wysaske, Dahlstrom and Karas on September 18, 2007, and with Mr.
Lycklama on November 18, 2009. These agreements expire in three
years, but are subject to annual renewal provisions. For the year
ending March 31, 2011, the annual salaries of Messrs. Sheaffer, Wysaske, Karas,
Dahlstrom and Lycklama are $263,883, $237,781, $174,777,
$174,276
and $143,500, respectively. The salaries, which are paid by Riverview
Community Bank, must be reviewed annually and may be increased at the discretion
of the Board. The employment agreements also provide that the
executives will participate in our salary at risk bonus program and to receive
all benefits that we provide to our employees generally. The
employment agreements provide that compensation must be paid in the event of
disability, termination without cause, termination by the executive for
specified reasons or in the event of a change in control, as described below
under “Potential Payments Upon Termination.”
Grants
of Plan-Based Awards
The following table shows information
regarding grants of plan-based awards made to our named executive officers for
the fiscal year ended March 31, 2010. We did not grant any equity
incentive plan awards or stock awards; therefore, these columns have been
omitted from the table below.
|
|
|
|
Estimated
Possible Payouts Under
Non-Equity
Incentive Plan Awards (1)
|
|
|
All
Other
Option
|
|
|
|
|
|
|
|
Name
|
|
Grant
Date
|
|
Threshold
($)
|
|
|
Target
($)
|
|
|
Maximum
($)
|
|
|
Awards:
Number
of
Securities
Underlying
Options
(#)(2)
|
|
|
Exercise
or
Base
Price
of
Option
Awards
($/sh)
|
|
|
Grant
Date
Fair
Value
of
Option
Awards
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Patrick
Sheaffer
|
|
|
|
|
--
|
|
|
|
105,554
|
|
|
|
211,108
|
|
|
|
|
|
|
|
|
|
|
|
|
09/22/09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,000
|
|
|
|
3.84
|
|
|
|
14,760
|
|
Ronald
A. Wysaske
|
|
|
|
|
--
|
|
|
|
115,991
|
|
|
|
231,982
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
09/22/09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,000
|
|
|
|
3.84
|
|
|
|
14,760
|
|
John
A. Karas
|
|
|
|
|
--
|
|
|
|
85,257
|
|
|
|
170,514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
09/22/09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,000
|
|
|
|
3.84
|
|
|
|
14,760
|
|
David
A. Dahlstrom
|
|
|
|
|
--
|
|
|
|
68,010
|
|
|
|
136,020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
09/22/09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,000
|
|
|
|
3.84
|
|
|
|
14,760
|
|
Kevin
J. Lycklama
|
|
|
|
|
--
|
|
|
|
58,651
|
|
|
|
117,302
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
09/22/09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,000
|
|
|
|
3.84
|
|
|
|
14,760
|
|
____________
(1)
|
Represents
the awards that could have been earned pursuant to the incentive
compensation plan; however, the named executive officers did not receive
any incentive compensation in the fiscal year ended March 31, 2010. The
performance goals and measurements associated with the incentive
compensation plan are provided in the “Incentive Compensation Program”
discussion beginning on page 13.
|
(2)
|
Options
vest in full on the first anniversary of the grant
date.
|
Outstanding
Equity Awards
The following information with respect
to outstanding option awards as of March 31, 2010 is presented for the named
executive officers. The named executive officers have no unvested
stock awards or equity incentive plan awards outstanding.
Name
|
|
Grant
Date
|
|
Number
of Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
|
Number
of Securities
Underlying
Unexercised
Options
(#)
Unexercisable (1)
|
|
Option
Exercise
Price
($)
|
|
Option
Expiration
Date
|
|
|
|
|
|
|
|
|
|
|
|
Patrick
Sheaffer
|
|
03/15/06
|
|
16,000
|
|
--
|
|
12.98
|
|
03/15/16
|
|
|
09/22/09
|
|
--
|
|
12,000
|
|
3.84
|
|
09/22/19
|
Ronald
A. Wysaske
|
|
03/15/06
|
|
16,000
|
|
--
|
|
12.98
|
|
03/15/16
|
|
|
09/22/09
|
|
--
|
|
12,000
|
|
3.84
|
|
09/22/19
|
John
A. Karas
|
|
03/15/06
|
|
16,000
|
|
--
|
|
12.98
|
|
03/15/16
|
|
|
09/22/09
|
|
--
|
|
12,000
|
|
3.84
|
|
09/22/19
|
(Table
continues on following page)
Name
|
|
Grant
Date
|
|
Number
of Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
|
Number
of Securities
Underlying
Unexercised
Options
(#)
Unexercisable (1)
|
|
Option
Exercise
Price
($)
|
|
Option
Expiration
Date
|
|
|
|
|
|
|
|
|
|
|
|
David
A. Dahlstrom
|
|
05/16/02
|
|
20,000
|
|
--
|
|
6.76
|
|
05/06/12
|
|
|
03/15/06
|
|
16,000
|
|
--
|
|
12.98
|
|
03/15/16
|
|
|
09/22/09
|
|
--
|
|
12,000
|
|
3.84
|
|
09/22/19
|
Kevin
J. Lycklama
|
|
03/19/08
|
|
3,000
|
|
2,000
|
|
10.19
|
|
03/19/18
|
|
|
09/22/09
|
|
--
|
|
12,000
|
|
3.84
|
|
09/22/19
|
____________
(1)
|
All
options vest in full on the first anniversary of the grant date, with the
exception of the options granted to Mr. Lycklama on March 19, 2008, 20% of
which vested on the grant date and the remainder of which vest in 20%
increments on the next four anniversaries of the grant
date.
|
Options
Exercised and Stock Vested
The named executive officers did not
realize any value upon the exercise of stock options or the vesting of
restricted stock awards during the year ended March 31, 2010.
Nonqualified
Deferred Compensation
The following information is presented
with respect to plans that provide for the deferral of compensation on a basis
that is not tax-qualified in which the named executive officers participated in
the year ended March 31, 2010.
Name
|
|
Executive
Contributions
in
Last
FY ($)
|
|
Registrant
Contributions
in
Last
FY ($)
|
|
Aggregate
Earnings
in
Last
FY ($)(1)
|
|
Aggregate
Withdrawals/
Distributions
($)
|
|
Aggregate
Balance
at FYE
($)(2)
|
|
|
|
|
|
|
|
|
|
|
|
Patrick
Sheaffer
|
|
--
|
|
--
|
|
31,443
|
|
66,002
|
|
530,253
|
Ronald
A. Wysaske
|
|
14,000
|
|
--
|
|
32,385
|
|
--
|
|
572,344
|
John
A. Karas
|
|
6,000
|
|
--
|
|
2,489
|
|
--
|
|
46,240
|
David
A. Dahlstrom
|
|
13,500
|
|
--
|
|
7,169
|
|
--
|
|
129,689
|
Kevin
J. Lycklama
|
|
15,300
|
|
--
|
|
1,325
|
|
--
|
|
30,777
|
|
|
|
|
|
|
|
|
|
|
|
__________
(1)
|
The
following amounts, constituting above-market earnings, were reported as
compensation in 2010 in the Summary Compensation Table: for Mr. Sheaffer,
$7,672; for Mr. Wysaske, $7,819; for Mr. Karas, $595; for Mr. Dahlstrom,
$1,721; and for Mr. Lycklama, $301.
|
(2)
|
Of
these amounts, the following amounts were reported as compensation to the
officers in previous years in the Summary Compensation Table: for Mr.
Sheaffer, $20,099; for Mr. Wysaske, $18,479; for Mr. Karas, $1,108; for
Mr. Dahlstrom, $3,380; and for Mr. Lycklama,
$161.
|
We currently have two deferred
compensation plans in place: the current plan, under which officers may make
contributions; and a frozen plan, under which officers may no longer make
contributions. Under the current plan, officers at the level of
senior vice president and above may elect to defer up to 50% of salary and bonus
until the time specified by the officer (or upon separation from service or a
change in control, if elected by the officer), with no income tax payable by the
officer until benefits are received under the deferred compensation plan adopted
by Riverview Community Bank. Once a deferral election is made for a
year, it cannot be changed during that year except under limited circumstances,
such as hardship or disability. We credit an earnings adjustment on
assets under the plan based on the rate of the Bank’s average yield on assets
for the prior year, less 100 basis points. For the calendar year
ended December 31, 2009, this crediting rate was 6.19%.
Under the current plan, upon the time
specified by the officer, or upon an earlier separation from service or a change
in control, if elected by the officer when he commences participation in the
plan, we will pay the officer or his designated beneficiaries his plan benefit
in a lump sum or in annual installments over ten years, as elected by the
officer. Under the frozen plan, payments begin upon the officer’s
separation from service, regardless of reason, and are made in the form elected
by the officer (either lump sum or in annual installments over ten
years). Under both plans, the payment election was made at the same
time the officer makes his compensation deferral election. Under the
current plan, the payment election may be changed only if the change election is
made sufficiently in advance, generally at least 12 months, and payments are
delayed for at least 5 years. Under both plans, the
payment
will be based on an amount equal to the balance in the officer’s account
immediately before the date on which benefits commence, plus interest, as
measured above, on the unpaid balance if the payment is made in
installments. Payments under both plans will be made as described
below under “Potential Payments Upon Termination.” The estimated
liability under the plan is accrued as earned by the officer. At
March 31, 2010, our aggregate liability under the plan for the named executive
officers was $1.3 million.
Potential
Payments Upon Termination
We have entered into agreements with
the named executive officers that provide for potential payments
upon disability, termination and retirement. In addition,
our equity plans also provide for potential payments upon
termination. The following table shows, as of March 31, 2010, the
value of potential payments and benefits following a termination of employment
under a variety of scenarios.
|
|
Disability
($)
|
|
|
Involuntary
Termination
($)
|
|
|
Involuntary
Termination
Following
Change
in
Control
($)
|
|
|
Normal
Retirement
($)
|
|
|
Death
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Patrick Sheaffer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employment
Agreement
|
|
|
337,861
|
|
|
|
701,290
|
|
|
|
890,043
|
|
|
|
--
|
|
|
|
--
|
|
Deferred
Compensation Plan
|
|
|
530,253
|
|
|
|
530,253
|
|
|
|
530,253
|
|
|
|
530,253
|
|
|
|
530,253
|
|
Equity
Plans (1)
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronald A. Wysaske
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employment
Agreement
|
|
|
67,542
|
|
|
|
639,710
|
|
|
|
821,757
|
|
|
|
--
|
|
|
|
--
|
|
Deferred
Compensation Plan
|
|
|
572,344
|
|
|
|
572,344
|
|
|
|
572,344
|
|
|
|
572,344
|
|
|
|
572,344
|
|
Equity
Plans (1)
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John A. Karas
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employment
Agreement
|
|
|
56,452
|
|
|
|
475,794
|
|
|
|
658,909
|
|
|
|
--
|
|
|
|
--
|
|
Deferred
Compensation Plan
|
|
|
46,240
|
|
|
|
46,240
|
|
|
|
46,240
|
|
|
|
46,240
|
|
|
|
46,240
|
|
Equity
Plans (1)
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
David A. Dahlstrom
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employment
Agreement
|
|
|
56,347
|
|
|
|
473,566
|
|
|
|
598,804
|
|
|
|
--
|
|
|
|
--
|
|
Deferred
Compensation Plan
|
|
|
129,689
|
|
|
|
129,689
|
|
|
|
129,689
|
|
|
|
129,689
|
|
|
|
129,689
|
|
Equity
Plans (1)
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kevin J. Lycklama
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employment
Agreement
|
|
|
49,527
|
|
|
|
391,501
|
|
|
|
475,319
|
|
|
|
--
|
|
|
|
--
|
|
Deferred
Compensation Plan
|
|
|
30,777
|
|
|
|
30,777
|
|
|
|
30,777
|
|
|
|
30,777
|
|
|
|
30,777
|
|
Equity
Plans (1)
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
_______________
(1) The
exercise price of unvested options was greater than the closing price of
Riverview’s common stock on March 31, 2010.
Employment
Agreements.
We have entered into employment agreements with
Messrs. Sheaffer, Wysaske, Karas, Dahlstrom and Lycklama. Each
agreement provides for payments to the executive upon his disability or
termination. If the executive becomes disabled during the term of his
employment agreement, his employment will terminate. Riverview
Community Bank must then pay the executive as disability pay, a bi-weekly
payment equal to three-quarters of his bi-weekly rate of base salary on the
effective date of the termination, with payments beginning on the effective date
of his termination. The disability pay shall be reduced by the
amount, if any, paid to the executive under any plan of the Bank providing
disability benefits to the executive. In addition, the Bank must also
cause to be continued life, medical, dental and disability coverage
substantially identical to the coverage maintained for the executive prior to
the executive’s termination for disability. The disability
payments and coverages will end on the earlier of (1) the date of the
executive’s
full-time
employment by another employer; (2) the executive’s death; or (3) the expiration
of the term of the executive’s employment agreement.
The employment agreements also provides
for benefits in the event of the executive’s termination. If the
executive’s employment is terminated for any reason other than a change in
control or cause, or the executive terminates his employment for good reason (as
defined in the agreement), the Bank must pay the executive a severance benefit
in an aggregate amount equal to the sum of the following: (1) base salary due to
the executive for the remaining term of his agreement; (2) prorated incentive
compensation for the remaining term of his agreement; (3) cash amount equal to
employer contributions that would have been made on the executive’s behalf over
the remaining term of his agreement to any tax-qualified retirement plan
sponsored by the Bank; (4) cash amount equal to the premiums that the Bank would
have paid on the executive’s behalf for life, medical, dental and disability
coverage over the remaining term of his agreement; and (5) any bonus earned for
a prior performance period but not yet paid. The employment
agreements restrict each executive’s right to compete against Riverview or
Riverview Community Bank if the executive voluntarily terminates his employment,
except in the event of a change in control.
The employment agreements also provide
for severance payments and other benefits in the event of an involuntary
termination of employment in connection with any change in control of
Riverview. If within 12 months after a change in control, the
executive’s employment is terminated other than for cause, or the executive
terminates his employment for good reason, we must pay a lump sum severance
payment of 2.99 times the executive’s base salary plus an amount equal to the
average annual incentive compensation and bonus earned by the executive for the
three fiscal years preceding the change in control. The employment
agreements contain provisions requiring reduction of any payments that would be
deemed to constitute an excess parachute payment under Section 280G of the
Internal Revenue Code.
Deferred Compensation
Plan.
Each of the named executive officers participates in the
Riverview Community Bank Directors’ and Executive Officers’ Deferred
Compensation Plan, as described in more detail above on page 16. The
current plan allows the officers to elect to defer up to 50% of salary and bonus
until separation from service, with no income tax payable by the officer until
benefits are received. An “override election” can be made in the
initial participation agreement and participants may elect to receive payment
upon the occurrence of an “override event.” Participants may elect
either or both of the following as an override event: separation from service
and/or change in control. Participants elect in their initial
participation agreement either a specific date (lump sum payment) or a fixed
schedule of payments (made annually over ten years) starting on a specified date
for distribution of their plan benefits. Distributions will be made
in accordance with the participant’s election, other than in the event of a
hardship withdrawal, death, disability, cashout of small accounts, required
delayed distributions to key employees or the termination of the
plan. Each of the named executive officers elected both separation
from service and change in control as an override event, except for Mr.
Sheaffer, who made no override election. There is also a frozen
deferred compensation plan, under which contributions may no longer be
made. Payments begin upon the participant’s separation from
service, regardless of reason, and are made in the form elected by the officer
(either lump sum or in annual installments over ten years). Payments under the
frozen plan shall commence on the first day of the second year following the
year in which the officer separates from service, unless the committee that
administers the plan elects to commence payment earlier, and earlier payment is
permitted by law. Payments may also be on account of hardship, as
defined under the plan.
Equity Plans.
Our
1998 and 2003 Stock Option Plans provide for accelerated vesting of awards in
the event of a change in control. Specifically, if a tender offer or
exchange offer for Riverview’s shares is commenced, or if a change in control
occurs, unless the committee administering the plan has provided otherwise in
the award agreement, all options granted and not fully exercisable shall become
exercisable in full upon the happening of that event.
Compensation
Committee Interlocks and Insider Participation
The members of the
Personnel/Compensation Committee are Directors Douglass, Geiger and
Olson. No members of this Committee were officers or employees of
Riverview or any of its subsidiaries during the year ended March 31, 2010, nor
were they formerly Riverview officers or had any relationships otherwise
requiring disclosure.
Audit Committee
Charter.
The Audit Committee operates pursuant to a charter
approved by our Board of Directors. In April 2007, the Board of
Directors adopted a revised Audit Committee charter to reflect the new
responsibilities imposed by the Sarbanes-Oxley Act of 2002. The
charter sets out the responsibilities, authority and specific duties of the
Audit Committee. The charter specifies, among other things, the
structure and membership requirements of the Audit Committee, as well as the
relationship of the Audit Committee to the independent auditor, the internal
audit department and management. The Audit Committee reports to the
Board of Directors and is responsible for overseeing and monitoring financial
accounting and reporting, the system of internal controls established by
management and the audit process.
Report of the Audit
Committee.
The Audit Committee reports as follows with respect
to Riverview’s audited financial statement for the year ended March 31,
2010:
•
|
The Audit Committee has reviewed
and discussed the 2010 audited financial statements with
management;
|
•
|
The
Audit Committee has discussed with the independent auditor, Deloitte &
Touche LLP, the matters required to be discussed by Statement on Auditing
Standards (“SAS”) No. 61,
Communication with
Audit
Committees
, as amended, as adopted by the Public Company Accounting
Oversight Board in Rule 3200T;
|
•
|
The
Audit Committee has received written disclosures and the letter from the
independent auditor required by the applicable requirements of the Public
Company Accounting Oversight Board regarding the independent auditor’s
communications with the Audit Committee concerning independence, and has
discussed with the independent auditor the auditor’s independence;
and
|
•
|
The
Audit Committee has, based on its review and discussions with management
of the 2010 audited financial statements and discussions with the
independent auditor, recommended to the Board of Directors that
Riverview’s audited financial statements for the year ended March 31, 2010
be included in its Annual Report on Form
10-K.
|
The foregoing report is provided by the
following directors, who constitute the Audit Committee:
|
Audit
Committee:
|
|
|
|
|
|
Edward
R. Geiger, Chairman
|
|
Jerry
C. Olson
|
|
Paul L.
Runyan
|
This
report shall not be deemed to be incorporated by reference by any general
statement incorporating by reference this proxy statement into any filing under
the Securities Act of 1933 or the Securities Exchange Act of 1934, and shall not
otherwise be deemed filed under such acts.
SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Securities
Exchange Act requires our executive officers and directors, and persons who own
more than 10% of any registered class of Riverview’s equity securities, to file
reports of ownership and changes in ownership with the SEC. Executive
officers, directors and greater than 10% stockholders are required by regulation
to furnish us with copies of all Section 16(a) forms they file. Based
solely on our review of the copies of such forms we have received and written
representations provided to us by the above-referenced persons, we believe that
during the fiscal year ended March 31, 2010, all filing requirements applicable
to our reporting officers, directors and greater than 10% stockholders were
properly and timely complied with, except for one late Form 4 covering one
transaction representing an inheritance received by Mr. Runyan.
Deloitte & Touche LLP served as our
independent auditor for the fiscal year ended March 31, 2010. The
Audit Committee of the Board of Directors has appointed Deloitte & Touche as
Riverview’s independent auditor for the fiscal year ending March 31, 2011.
A representative of
Deloitte & Touche will be present at the annual meeting to respond to
stockholders’ questions and will have the opportunity to make a statement if he
or she so desires.
The following table sets forth the
aggregate fees billed, or expected to be billed, to Riverview by Deloitte &
Touche for professional services rendered for the fiscal years ended March 31,
2010 and 2009.
|
|
Year
Ended
March
31,
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
Audit
Fees
|
|
$
|
315,000
|
|
|
$
|
325,000
|
|
Audit-Related
Fees
|
|
|
--
|
|
|
|
--
|
|
Tax
Fees
|
|
|
--
|
|
|
|
--
|
|
All
Other Fees (1)
|
|
|
49,115
|
|
|
|
--
|
|
_______
|
|
Represents
fees in connection with the Registration Statement on Form S-1 filed by
Riverview.
|
The Audit Committee will establish
general guidelines for the permissible scope and nature of any permitted
non-audit services to be provided by the independent auditor in connection with
its annual review of its charter. Pre-approval may be granted by
action of the full Audit Committee or by delegated authority to one or more
members of the Audit Committee. If this authority is delegated, all
approved non-audit services will be presented to the Audit Committee at its next
meeting. In considering non-audit services, the Audit Committee or
its delegate will consider various factors, including but not limited to,
whether it would be beneficial to have the service provided by the independent
auditor and whether the service could compromise the independence of the
independent auditor.
STOCKHOLDER PROPOSALS AND
NOMINATIONS
In order to be eligible for inclusion
in our proxy solicitation materials for next year’s annual meeting of
stockholders, any stockholder proposal to take action at such meeting must be
received at our main office at 900 Washington Street, Suite 900, Vancouver,
Washington 98660, no later than February 21, 2011. Any such proposals
shall be subject to the requirements of the proxy solicitation rules adopted
under the Securities Exchange Act.
Our Articles of Incorporation provide
that if a stockholder intends to nominate a candidate for election as a director
or submit a stockholder proposal, the stockholder must deliver written notice of
his or her intention to the Corporate Secretary of Riverview not less than 30
nor more than 60 days prior to the date of a meeting of stockholders; provided,
however, that if less than 31 days’ notice of the date of the meeting is given
or made to stockholders, such written notice must be delivered to the Corporate
Secretary not later than the close of the tenth day following the day on which
notice of the meeting was mailed to stockholders. The notice must set
forth certain information specified in our Articles of
Incorporation.
The Board of Directors is not aware of
any business to come before the annual meeting other than those matters
described above in this Proxy Statement. However, if any other
matters should properly come before the meeting, it is intended that proxies in
the accompanying form will be voted in respect thereof in accordance with the
judgment of the person or persons voting the proxies.
We will bear the cost of solicitation
of proxies. In addition to solicitations by mail, our directors,
officers and employees may solicit proxies personally or by telephone without
additional compensation.
Riverview’s Annual Report to
Stockholders, which includes the Annual Report on Form 10-K as filed with the
SEC, has been mailed to stockholders as of the close of business on the voting
record date. Any stockholder who has not received a copy of the
Annual Report may obtain a copy by writing to the Corporate
Secretary. The Annual Report is not to be treated as part of the
proxy solicitation material or as having been incorporated herein by
reference.
|
BY ORDER OF THE
BOARD OF DIRECTORS
|
|
|
|
/s/Phyllis
Kreibich
|
|
|
|
PHYLLIS
KREIBICH
|
|
CORPORATE
SECRETARY
|
Vancouver,
Washington
June 21,
2010
REVOCABLE
PROXY
RIVERVIEW
BANCORP, INC.
ANNUAL
MEETING OF STOCKHOLDERS
JULY
21, 2010
The undersigned hereby appoints the
official Proxy Committee of the Board of Directors of Riverview Bancorp, Inc.
(“Riverview”) with full powers of substitution, as attorneys and proxies for the
undersigned, to vote all shares of common stock of Riverview which the
undersigned is entitled to vote at the annual meeting of stockholders, to be
held at the Riverview Center, 17205 S.E. Mill Plain Boulevard, Vancouver,
Washington, on Wednesday, July 21, 2010, at 10:00 a.m., local time, and at any
and all adjournments or postponements thereof, as indicated.
|
|
|
|
VOTE
|
|
|
FOR
|
|
WITHHELD
|
|
|
|
|
|
1.
|
The
election as directors of the nominees listed below
|
[ ]
|
|
[ ]
|
|
(except
as marked to the contrary below)
|
|
|
|
|
|
|
|
|
|
Ronald
A. Wysaske
|
|
|
|
|
Michael
D. Allen
|
|
|
|
|
Gerald
L. Nies
|
|
|
|
|
|
|
|
|
|
INSTRUCTIONS: To
withhold your vote for any
|
|
|
|
|
individual
nominee, write the nominee’s name on
|
|
|
|
|
the
line below.
|
|
|
|
|
|
|
|
|
|
__________________________________________
|
|
|
|
|
__________________________________________
|
|
|
|
|
__________________________________________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2.
|
In
their discretion, upon such other matters as may
properly
come before the meeting.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
Board of Directors recommends a vote “FOR” the election of the nominees
listed above.
|
This proxy will be voted as directed, but
if no instructions are specified, this proxy will be voted for the election of
the nominees listed above. If any other business is presented at such
meeting, this proxy will be voted by those named in this proxy in their best
judgment. At the present time, the Board of Directors knows of no
other business to be presented at the meeting. This proxy also
confers discretionary authority on the Board of Directors to vote with respect
to the election of any person as director where the nominee is unable to serve
or for good cause will not serve, and matters incident to the conduct of the
2010 annual meeting.
THIS
PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and
elect to vote at the annual meeting or at any adjournment or postponement
thereof and after notification to the Corporate Secretary of Riverview at the
meeting of the stockholder’s decision to terminate this proxy, then the power of
said attorneys and proxies shall be deemed terminated and of no further force
and effect.
The undersigned acknowledges receipt
from Riverview, prior to the execution of this proxy, of the Notice of Annual
Meeting of Stockholders, a Proxy Statement for the annual meeting of
stockholders, and the 2010 Annual Report to Stockholders.
Dated:
___________________
,
2010
|
|
|
|
________________________________________
|
|
________________________________________
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PRINT
NAME OF STOCKHOLDER
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PRINT
NAME OF STOCKHOLDER
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________________________________________
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________________________________________
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SIGNATURE
OF STOCKHOLDER
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SIGNATURE
OF STOCKHOLDER
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Please
sign exactly as your name appears on the enclosed card. When signing
as attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, only one signature is required,
but each holder should sign, if possible.
Please
complete, date, sign and mail this proxy promptly in the enclosed
postage-prepaid envelope.