UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12
TOMPKINS TRUSTCO, INC.
------------------------------------------------
(Name of Registrant as Specified In Its Charter)
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies: N/A
(2) Aggregate number of securities to which transaction applies: N/A
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to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined): N/A
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
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statement number, or the Form or Schedule and the date of its filing.
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[LOGO] TOMPKINS TRUSTCO INC.
April 7, 2006
NOTICE OF 2006 ANNUAL MEETING OF STOCKHOLDERS
TO THE STOCKHOLDERS OF TOMPKINS TRUSTCO, INC.
The annual meeting of stockholders (the "Meeting") of Tompkins Trustco, Inc.
("Tompkins Trustco" or the "Company") will be held on Monday, May 8, 2006 at
5:30 p.m., at the Country Club of Ithaca, 189 Pleasant Grove Road, Ithaca, New
York, for the following purposes:
1. To elect five (5) directors for a term of three (3) years expiring in
the year 2009; and
2. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 10, 2006 as the
record date for determining stockholders entitled to notice of and to vote at
the Meeting. Only stockholders of record at the close of business on that date
are entitled to vote at the Meeting.
A stockholder's information meeting will be held at 5:30 p.m. on Wednesday, May
10, 2006, for our stockholders in the Castile area at Terry Hills, 5122 Clinton
Street Road (Rt. 33), Batavia, New York.
A stockholder's information meeting will be held at 6:00 p.m. on Wednesday, May
24, 2006, for our stockholders in the Mahopac area at Mahopac Golf Club, 601
North Lake Blvd., Mahopac, New York.
Enclosed with this notice are a proxy statement, a form of proxy and return
envelope, instructions for voting by telephone or via the Internet, the
Company's Annual Report on Form 10-K for the Company's 2005 fiscal year, and the
Company's 2005 Corporate Report to stockholders.
Your vote is important regardless of the number of shares you own. Whether or
not you plan to attend the Meeting, you are urged to read and carefully consider
the enclosed proxy statement. You may vote by telephone, via the Internet, or
mark, sign, date, and return the enclosed form of proxy in the accompanying
pre-addressed postage-paid envelope. Your proxy may be revoked prior to its
exercise by filing a written notice of revocation or a duly executed proxy
bearing a later date with the Corporate Secretary of Tompkins Trustco prior to
the Meeting, or by attending the Meeting and filing a written notice of
revocation with the Corporate Secretary at the Meeting prior to the vote and
voting in person.
By Order of the Board of Directors,
/s/ JAMES J. BYRNES /s/ LINDA M. CARLTON
---------------------------------- ---------------------------------
James J. Byrnes Linda M. Carlton
Chairman & Chief Executive Officer Asst. Vice President & Corporate
Secretary
P.O. BOX 460, ITHACA, NEW YORK 14851 (607) 273-3210
[This Page Intentionally Left Blank]
[LOGO] TOMPKINS TRUSTCO INC.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 8, 2006
This proxy statement together with the form of proxy is being mailed to
stockholders on or about April 7, 2006 in connection with the solicitation by
the Board of Directors of Tompkins Trustco, Inc. (the "Company") of proxies to
be used at the annual meeting of stockholders (the "Meeting") of the Company to
be held at the Country Club of Ithaca, 189 Pleasant Grove Road, Ithaca, New York
on Monday, May 8, 2006 at 5:30 p.m., and any adjournment thereof.
Voting
Only stockholders of record at the close of business on March 10, 2006 will be
entitled to vote. On March 10, 2006, there were 9,047,394 shares of common stock
of the Company, par value $0.10 per share (the "Common Stock"), outstanding.
Each share of Common Stock is entitled to one vote on each matter to be voted on
at the Meeting.
Stockholders whose shares are registered in their own names may vote by mailing
a completed proxy, via the Internet or by telephone. Instructions for voting via
the Internet or by telephone are set forth on the enclosed form of proxy. To
vote by mailing a proxy, sign and return the enclosed form of proxy in the
enclosed pre-addressed postage-paid envelope. Shares of Common Stock covered by
a proxy that is properly executed and received prior to the close of business on
the day of the Meeting will be voted and, if the stockholder who executes such
proxy shall specify therein how such shares shall be voted on such proposals,
the shares will be voted as so specified. Executed proxies with no instructions
will be voted "FOR" each proposal for which no instruction is given. Other than
the election of directors, the Board is not aware of any other matters to be
presented for stockholder action at the Meeting. However, if other matters do
properly come before the Meeting or any adjournments thereof, the Board of
Directors intends that the persons named in the accompanying proxy will vote the
shares represented by all properly executed proxies on any such matters in
accordance with the judgment of the person or persons acting under the proxy.
The presence of a stockholder at the Meeting will not automatically revoke a
proxy previously delivered by that stockholder. A stockholder may, however,
revoke his or her proxy at any time prior to its exercise by: (1) delivering to
the Corporate Secretary a written notice of revocation prior to the Meeting, (2)
delivering to the Corporate Secretary a duly executed proxy bearing a later
date, or (3) attending the Meeting and filing a written notice of revocation
with the Corporate Secretary at the Meeting prior to the vote and voting in
person.
The presence, in person or by proxy, of at least a majority of the total number
of shares of Common Stock entitled to vote at the Meeting is necessary to
constitute a quorum for the conduct of business at the Meeting and, in the event
there are not sufficient votes on any matter, the Meeting may be adjourned.
Vote Required And Board Recommendations
Proposal Vote Required Board of Directors Recommendation
-------- ------------- ---------------------------------
Election of Directors Plurality of eligible votes cast "FOR" all director nominees
Abstentions and Broker Non-votes
Abstentions, in person or by proxy, and broker non-votes will each be counted
for purposes of determining the presence of a quorum. A "broker non-vote" occurs
when a nominee holding shares for a beneficial owner does not vote on a
particular proposal because the nominee does not have discretionary voting power
on that matter and has not received instructions from the beneficial owner.
However, abstentions and broker non-votes are not deemed to be "votes cast" and
therefore have no effect on the outcome of the vote, which requires a plurality
of the votes cast. Votes withheld in connection with the election of one or more
of the nominees for director will not be counted as votes cast and will have no
effect on the outcome of the election.
Solicitation of Proxies
The total cost of solicitation of proxies in connection with the Meeting will be
borne by the Company. In addition to solicitation by mail, directors, officers
and employees of the Company may solicit proxies for the Meeting personally or
by telephone or electronic communication without additional remuneration. The
Company will also provide brokers and other record owners holding shares in
their names or in the names of nominees, in either case which are beneficially
owned by others, proxy material for transmittal to such beneficial owners and
will reimburse such record owners for their expenses in doing so.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information, as of March 10, 2006, with
respect to the beneficial ownership of the Company's Common Stock by: (i) each
stockholder known by the Company to be the beneficial owner of more than 5% of
the Company's Common Stock; (ii) each director and nominee; (iii) each executive
officer named in the Summary Compensation Table; and (iv) all executive officers
and directors as a group. Except as otherwise indicated, each of the
stockholders named below has sole voting and investment power with respect to
the outstanding shares of Common Stock beneficially owned.
Common Stock
Beneficially Owned
-------------------------------
Percent of
Number of Outstanding
Names Shares Shares(1)
--------------------------------------------------------------------------------
Directors, Nominees and Executive Officers
Russell K. Achzet+ 31,726(2) **
John E. Alexander+ 16,928(3) **
James J. Byrnes*+ 79,945(4) **
Francis M. Fetsko* 17,480(5) **
James W. Fulmer*+ 104,229(6) 1.15
Stephen E. Garner* 35,849(7) **
Reeder D. Gates+ 103,324(8) 1.14
William W. Griswold+ 2,528(9) **
James R. Hardie+ 71,367(10) **
Elizabeth W. Harrison+ 254(11) **
Bonnie H. Howell+ 4,307(12) **
Patricia A. Johnson++ 0(13) **
Hunter R. Rawlings, III+ 826(14) **
Stephen S. Romaine* 9,089(15) **
Thomas R. Salm+ 2,581(16) **
Michael H. Spain+ 422,461(17) 4.67
William D. Spain, Jr.+ 419,806(18) 4.64
Craig Yunker+ 9,721(19) **
All directors and executive
officers as a group (22 persons) 1,087,149 11.85
Investment Services Division of
Tompkins Trust Company in the
fiduciary capacity indicated:
Executor, Trustee or Co-Trustee 1,004,934(20) 11.11
Trustee for the Tompkins 630,591(20) 6.97
Trustco Employee Stock
Ownership and Investment &
Stock Ownership Plans
Agent or Custodian 302,901(20) 3.35
* Named Executive Officer
+ Currently a Director of the Company
++ Director Nominee
** Less than 1 percent
2
(1) The number of shares beneficially owned by each person or group as of
March 10, 2006 includes shares of Common Stock that such person or group
had the right to acquire on or within 60 days after March 10, 2006,
including, but not limited to, upon the exercise of options. References
to options in these footnotes include only options to purchase shares
that were exercisable on or within 60 days after March 10, 2006. For each
individual and group included in the table, percentage ownership is
calculated by dividing the number of shares beneficially owned by such
person or group by the sum of the 9,047,394 shares of Common Stock
outstanding on March 10, 2006 plus the number of shares of Common Stock
that such person or group had the right to acquire on or within 60 days
after March 10, 2006.
(2) Shares are owned by the Russell K. Achzet Revocable Trust.
(3) Includes 322 shares owned by Mr. Alexander's spouse. Does not include
2,527 shares acquired pursuant to the Company's Stock Retainer Plan for
Eligible Directors of Tompkins Trustco, Inc. and Participating
Subsidiaries (the "Retainer Plan") and held in a deferred trust account;
directors have no voting or investment power with respect to such shares.
(4) Includes 22,092 shares held in the Company's Employee Stock Ownership and
Investment & Stock Ownership Plans and 9,075 shares that Mr. Byrnes may
acquire by exercise of options exercisable at March 10, 2006 or 60 days
thereafter.
(5) Includes 1,619 shares held in the Company's Employee Stock Ownership and
Investment & Stock Ownership Plans and 15,056 shares that Mr. Fetsko may
acquire by exercise of options exercisable at March 10, 2006 or 60 days
thereafter.
(6) Includes 11,846 shares held in the Company's Employee Stock Ownership
Plan, 23,265 shares owned by Mr. Fulmer's spouse, 320 shares held by Mr.
Fulmer as Custodian for his son under the Uniform Transfers to Minors
Act, and 31,790 shares that Mr. Fulmer may acquire by exercise of options
exercisable at March 10, 2006 or 60 days thereafter.
(7) Includes 5,208 shares held in the Company's Employee Stock Ownership and
Investment & Stock Ownership Plans and 21,141 shares that Mr. Garner may
acquire by exercise of options exercisable at March 10, 2006 or 60 days
thereafter.
(8) Includes 87,134 shares held in the R. D. Gates, Ltd. Employee Profit
Sharing Fund, over which Mr. Gates exercises voting and investment power,
and 2,435 shares owned by Mr. Gates' spouse. Does not include 2,404
shares acquired pursuant to the Retainer Plan and held in a deferred
trust account; directors have no voting or investment power with respect
to such shares.
(9) Does not include 2,976 shares acquired pursuant to the Retainer Plan and
held in a deferred trust account; directors have no voting or investment
power with respect to such shares.
(10) Includes 367 shares held in the Company's Employee Stock Ownership Plan.
Does not include 270 shares acquired pursuant to the Retainer Plan and
held in a deferred trust account; directors have no voting or investment
power with respect to such shares.
(11) Does not include 480 shares acquired pursuant to the Retainer Plan and
held in a deferred trust account; directors have no voting or investment
power with respect to such shares.
(12) Does not include 1,672 shares acquired pursuant to the Retainer Plan and
held in a deferred trust account; directors have no voting or investment
power with respect to such shares.
(13) Does not include 435 shares acquired pursuant to the Retainer Plan and
held in a deferred trust account; directors have no voting or investment
power with respect to such shares.
(14) Does not include 2,083 shares acquired pursuant to the Retainer Plan and
held in a deferred trust account; directors have no voting or investment
power with respect to such shares.
(15) Includes 1,431 shares held in the Company's Employee Stock Ownership and
Investment & Stock Ownership Plans and 7,658 shares that Mr. Romaine may
acquire by exercise of options exercisable at March 10, 2006 or 60 days
thereafter.
(16) Includes 759 shares owned by Mr. Salm's spouse. Does not include 2,837
shares acquired pursuant to the Retainer Plan and held in a deferred
trust account; directors have no voting or investment power with respect
to such shares.
(17) Includes 382,461 shares of Common Stock held by W. D. Spain & Sons
Limited Partnership, of which Mr. Michael Spain is a General Partner and
shares voting and investment control. Mr. Spain disclaims beneficial
ownership of all shares of Common Stock owned by W. D. Spain & Sons
Limited Partnership, except to the extent of 76,492 shares which
represent his indirect pecuniary interest, through his ownership of 20%
of W. D. Spain & Sons Limited Partnership. Mr. Spain's beneficial
ownership does not include 776 shares acquired pursuant to the Retainer
Plan and held in a deferred trust account; directors have no voting or
investment power with respect to such shares.
3
(18) Includes 382,461 shares of Common Stock held by W. D. Spain & Sons
Limited Partnership, of which Mr. William Spain, Jr. is a General Partner
and shares voting and investment control. Mr. Spain disclaims beneficial
ownership of all shares of Common Stock owned by W. D. Spain & Sons
Limited Partnership, except to the extent of 76,492 shares which
represent his indirect pecuniary interest, through his ownership of 20%
of W. D. Spain & Sons Limited Partnership. Mr. Spain's beneficial
ownership does not include 889 shares acquired pursuant to the Retainer
Plan and held in a deferred trust account; directors have no voting or
investment power with respect to such shares.
(19) Does not include 1,144 shares acquired pursuant to the Retainer Plan and
held in a deferred trust account; directors have no voting or investment
power with respect to such shares.
(20) As of March 10, 2006, Tompkins Investment Services, a division of the
Tompkins Trust Company, which is a wholly owned subsidiary of the Company
(the "Trust Company"), held 1,938,426 shares of Common Stock of the
Company, representing 21.43% of the outstanding shares of Common Stock.
Of such shares, 1,004,934 shares are held in a fiduciary capacity as
executor, trustee or co-trustee. Where the Trust Company is sole executor
or trustee, such shares, generally, will be voted only if the legal
instrument provides for voting the stock at the direction of the donor or
a beneficiary and such direction is in fact received. When acting in a
co-fiduciary capacity, such shares will be voted by the co-fiduciary or
fiduciaries in the same manner as if the co-fiduciary or fiduciaries were
the sole fiduciary. Of the 630,591 shares identified in the above table,
489,436 shares, or 5.41% of the outstanding shares, are held by the
Tompkins Trustco, Inc. Employee Stock Ownership Plan and 141,155 shares,
or 1.56% of the outstanding shares, are held by the Tompkins Trustco,
Inc. Investment & Stock Ownership Plan for which all shares have been
allocated to participant accounts. Individual plan participants are
entitled to vote these shares, and as a result these shares are not voted
by the Trustee. The shares of Common Stock held in deferred trust
accounts for non-employee directors are voted by the Trust Company, as
trustee of the Rabbi Trust. In addition, 302,901 shares are held as agent
or custodian with the voting power retained by the owner. Such shares
represent 3.35% of the Common Stock outstanding. Tompkins Trust Company's
address is P.O. Box 460, Ithaca, New York 14851.
4
PROPOSAL
ELECTION OF DIRECTORS
The Board is divided into three classes, with the classes of directors serving
for staggered three-year terms that expire in successive years. Four of the
nominees for director are currently serving as directors of the Company and are
standing for re-election at the Meeting. Mr. Achzet, whose term as a director of
the Company commenced after the last election of directors, was appointed to the
Board in January 2006 to fill a vacancy on the Board created in connection with
the Company's acquisition of AM&M Financial Services, Inc., an entity in which
Mr. Achzet served as an executive officer and was a principal shareholder. Mr.
Achzet was recommended by the Nominating and Corporate Governance Committee for
appointment, and nomination for election to the Board at the Meeting, pursuant
to the terms and conditions of the agreement and plan of merger governing the
Company's acquisition of AM&M Financial Services. Nominee Patricia A. Johnson
was identified and nominated by the Nominating and Corporate Governance
Committee.
At the Meeting, stockholders will elect five directors to hold office until the
2009 annual meeting of stockholders or until their successors are duly elected
and qualified. The nominees receiving the highest number of affirmative votes of
the shares entitled to vote at the Meeting will be elected to the Board.
The persons named in the proxy to represent stockholders at the Meeting are
Francis M. Fetsko and Linda M. Carlton. The proxies will vote as directed and in
the absence of instructions, will vote the shares represented by the proxies in
favor of the election of nominees named below. In the event any nominee is
unable or declines to serve as a director at the time of the Meeting, the
proxies will be voted for any nominee, if any, who may be designated by the
Board of Directors, upon recommendation of the Company's Nominating and
Corporate Governance Committee, to fill the vacancy. As of the date of this
proxy statement, the Board of Directors is not aware that any nominee is unable
or will decline to serve as a director.
The Board recommends a vote "FOR" the election of each of the director nominees.
The following table sets forth each director nominee and continuing director's
name, age, the year he or she first became a director and the year in which his
or her term will expire. Biographies of the director nominees and the directors
continuing in office follow the table. Unless otherwise indicated, all directors
have been employed in their current positions for at least five years.
Year First
Elected Term to
Name Age Director Expire Independent(1)
----------------------------------------------------------------------------------------------
Board Nominees for Terms to Expire in 2009:
----------------------------------------------------------------------------------------------
Russell K. Achzet 65 2006 2009 No
James W. Fulmer 54 2000 2009 No
James R. Hardie 63 2001 2009 No
Patricia A. Johnson 50 -- 2009 Yes
Thomas R. Salm 65 1981(2) 2009 Yes
----------------------------------------------------------------------------------------------
Directors Continuing in Office:
----------------------------------------------------------------------------------------------
John E. Alexander 53 1993(2) 2008 Yes
Elizabeth W. Harrison 55 2004 2008 Yes
Hunter R. Rawlings III 61 1996 2008 Yes
Craig Yunker 55 2000 2008 Yes
James J. Byrnes 64 1989(2) 2007 No
Reeder D. Gates 60 1985(2) 2007 Yes
Bonnie H. Howell 58 1982(2) 2007 Yes
Michael H. Spain 48 2000 2007 No
William D. Spain, Jr. 54 2000 2007 No
(1) Independence has been determined in accordance with Section 121A of the
listing standards of the American Stock Exchange ("AMEX").
(2) Served as director of Tompkins Trust Company, which, as a result of a
reorganization in 1995, became a wholly-owned subsidiary of Tompkins Trustco.
5
Business Experience of Directors, including Director Nominees
Russell K. Achzet was appointed to serve as a director of the Company on January
24, 2006. He founded AM&M Financial Services, Inc. in 1977, and its affiliated
entities thereafter. He served as Chief Executive Officer of AM&M Financial
Services until it was acquired by the Company on January 6, 2006. Mr. Achzet is
certified by the Certified Financial Planner Board of Standards, Inc., and is a
founder of National Advisors Trust Company, FSB and served on its Board of
Directors until December 2005. He currently serves on the Foundation Advisory
Board of Monroe Community College and the University of Rochester Planned Giving
Council.
James W. Fulmer has served as President and a director of the Company since
2000. He also serves as a director of The Bank of Castile, and has served in
such capacity since 1988 and as its Chairman since 1992. Effective December 18,
2002, he assumed the additional responsibilities of President and Chief
Executive Officer of The Bank of Castile. Mr. Fulmer serves as a director of
Mahopac National Bank, and has served in such capacity since 1999, and as
Chairman of Tompkins Insurance Agencies since January 1, 2001. He served as the
President and Chief Executive Officer of Letchworth Independent Bancshares
Corporation from 1991 until its merger with the Company in 1999. Mr. Fulmer also
served as the Chief Executive Officer of The Bank of Castile from 1996 through
April 2000. He serves as a member of the board of directors of Erie and Niagara
Insurance Association, the United Memorial Medical Center, and the Cherry Valley
Cooperative Insurance Company, and is Treasurer of the Genesee County Economic
Development Center. Under the terms of a management succession plan adopted by
the Company's Board of Directors (the "Succession Plan"), it is expected that
Mr. Fulmer will serve as a Vice Chairman of the Company beginning January 1,
2007.
James R. Hardie has served as a director of the Company since 2001. Mr. Hardie
has been Vice Chairman of the board of directors of Tompkins Insurance Agencies,
a wholly-owned subsidiary of the Company, since August 1, 2002. He was President
of Austin, Hardie, Wise Agency, Inc. from 1974 until January 1, 2001, when he
became President, Chief Executive Officer and a director of Tompkins Insurance
Agencies. Effective January 1, 2003, Mr. Hardie's role as President and Chief
Executive Officer was assumed by David S. Boyce; although Mr. Hardie no longer
serves as the President and Chief Executive Officer of Tompkins Insurance
Agencies, he continues to be employed by Tompkins Insurance Agencies as a
producer. Mr. Hardie is the managing member of Bennington Farms, LLC, a property
leasing company, and a minority stockholder in Moeller Hardie Jewelers.
Patricia A. Johnson currently serves as a director of Tompkins Trust Company, a
wholly-owned subsidiary of the Company, and has served in such capacity since
2002. Ms Johnson began with Cornell University as the Assistant Treasurer in
1995 and has been Treasurer since March, 1999. Ms. Johnson serves, or has
served, on numerous professional and community associations and boards of
director, including the McGraw Housing Company, where she served as a director
and served as President in 2003, the Ladies Union Benevolent Society, where she
served as Treasurer, the Paleontological Research Institution, where she serves
as Treasurer, Planned Parenthood of the Southern Finger Lakes, where she serves
as a director, and previously served as Chair of the finance committee, and is
currently the Vice Chair, Tompkins County Foundation, where she serves as Vice
President, the United Educators Insurance Company, where she serves as a
director and as a member of the investment committee, the Tompkins County Area
Development where she serves as a director and as a member of the executive
committee. She was also a member of the NACUBO Accounting Principles Council,
and is currently a member of the Association for Financial Professionals.
Thomas R. Salm has served as a director of the Company since 1995 and as a
director of Tompkins Trust Company since 1981. Prior to his retirement on August
31, 2002, Mr. Salm served as Vice President for Business Affairs at Ithaca
College, Ithaca, New York for 26 years.
John E. Alexander has served as a director of the Company since 1995 and as a
director of Tompkins Trust Company since 1993. Mr. Alexander was a principal
stockholder and served as President and Chief Executive Officer of The CBORD
Group, Inc., a computer software company which Mr. Alexander founded in 1975,
until July 1, 2004. Mr. Alexander currently serves as Chairman of the Board of
The CBORD Group.
Elizabeth W. Harrison has served as a director of the Company since 2004. She
also serves as a director of The Bank of Castile, which is a wholly-owned
subsidiary of the Company, and she has served in such capacity since February
2002. Ms. Harrison is President and Chief Executive Officer of the Genesee
Country Village & Museum and has served in such capacity since November 1999.
She also serves on the Museum's Board of Trustees. Prior to 1999, Ms. Harrison
served for 18 years as President and Chief Executive Officer of Career
Development Services, a not-for-profit educational corporation. Ms. Harrison
serves on the boards of the Finger Lakes Tourism Alliance, the Museum
Association of New York, and the Arts and Cultural Council.
6
Hunter R. Rawlings, III has served as a director of the Company and as a
director of Tompkins Trust Company since 1996. From July 1, 1995, until his
resignation, effective June 30, 2003, Dr. Rawlings was President of Cornell
University. Dr. Rawlings is a Professor in the Classics Department and is
serving as Interim President of Cornell University for the 2005-2006 academic
year.
Craig Yunker has served as a director of the Company since 2000 and as a
director of The Bank of Castile since 1991. He is the Managing Member of CY
Farms, LLC, CY Properties, LLC, CY Heifer Farm, LLC, Batavia Turf, LLC,
Provitello, LLC, companies engaged in farming, and Agricultural Development
Services, LLC, an agricultural consulting business. Since 2001, he has served as
a Trustee of Cornell University.
James J. Byrnes has served as the Company's Chief Executive Officer since its
formation in 1995 and has served as the Chairman of the Board of Directors of
the Company since 1992. From 1995 until January 24, 2000, Mr. Byrnes also served
as the President of the Company. Mr. Byrnes currently serves as Chairman of the
Board of Directors of Tompkins Trust Company. He also serves as a director of
Mahopac National Bank, Tompkins Insurance Agencies, Inc., The Bank of Castile,
and AM&M Financial Services, all subsidiaries of the Company. He also serves as
Chairman of New York Business Development Corporation. Additionally, from 1989
until December 31, 2002, Mr. Byrnes served as the President and Chief Executive
Officer of Tompkins Trust Company. From 1978 to 1988, Mr. Byrnes was employed at
the Bank of Montreal, most recently as Senior Vice President. Under the
Succession Plan, Mr. Byrnes is expected to retire from his position as Chief
Executive Officer of the Company on January 1, 2007.
Reeder D. Gates has served as a director of the Company since 1995 and as a
director of Tompkins Trust Company since 1985. Prior to his retirement in 2005,
Mr. Gates was the President of R. D. Gates, Ltd., a company engaged in owning
and operating community pharmacies, since January 1972.
Bonnie H. Howell has served as a director of the Company since 1995, and, until
April 1, 2005, Dr. Howell served as Vice Chair of the Board of Directors of the
Company, which position she held since 1995. Mr. Griswold assumed that position
on April 1, 2005. She also serves as a director of Tompkins Trust Company, and
has served in such capacity since 1982, and as Vice Chair of the Board of
Directors of Tompkins Trust Company since 1992. Prior to her retirement on
December 31, 2002, Dr. Howell was President and Chief Executive Officer of
Cayuga Medical Center at Ithaca. She also serves as a Trustee of the Hospital
Association of New York State. She has an appointment to Cornell University as
Executive in Residence for the Sloan Program in Health Administration. She also
taught a graduate level course in leadership. Dr. Howell also holds the position
of Senior Consultant at Foley, Proctor Yoskowitz, where she specializes in
executive coaching.
Michael H. Spain has served as a director of the Company since 2000. Mr. Spain
also serves as a director of Mahopac National Bank, and has served in such
capacity since since 1992. Mr. Spain also owns and serves as the President of
the Spain Agency, an insurance agency located in Mahopac, New York. Mr. Spain is
also a General Partner in W. D. Spain & Sons, LLP, a family limited partnership
that owns Common Stock of the Company; President of Sleeping Indian, LLC, and
Trail Property, Inc, real estate holding companies; and President of Wind River,
LLC and Indian Paintbrush, LLC, companies engaged in real estate development.
William D. Spain, Jr. has served as a director of the Company since 2000. He
also serves as a director of Mahopac National Bank, and has served in such
capacity since 1991, and as Chairman of the Board of Directors of Mahopac
National Bank since 2000. He has been the Managing Partner of Spain & Spain, PC,
a law firm in Mahopac, New York, since 1983. Mr. Spain is also a General Partner
in W. D. Spain & Sons, LLP, a family limited partnership that owns Common Stock
of the Company.
The names and ages of the Company's executive officers, including the Named
Executive Officers identified in the Summary Compensation Table in this proxy
statement, their positions and offices held with the Company, their term of
office and experience is set forth in Part I of the Company's Annual Report on
Form 10-K for the Company's 2005 fiscal year, a copy of which is enclosed with
this proxy statement.
7
Matters Relating To The Board Of Directors
Board of Directors Meetings and Committees
During fiscal 2005, the Board of Directors held four regular meetings and one
special meeting. During this period, all of the directors attended or
participated in at least 75%, other than Ms. Howell who attended or participated
in 61%, of the aggregate of the total number of meetings of the Board of
Directors and the total number of meetings held by all committees of the Board
of Directors on which each such director served. Ms. Howell was briefed, both
before and after meetings, on matters covered at the Board of Director and
committee meetings she was not able to attend.
The Annual Meeting of Stockholders for fiscal 2004 was held on May 9, 2005, and
with the exception of Hunter R. Rawlings, III, all of the Company's directors
were in attendance.
The Board currently maintains and appoints the members of the following four
standing committees: Executive/Compensation/Personnel Committee, Audit/Examining
Committee, Nominating and Corporate Governance Committee and the Pension
Investment Review Committee.
The current members of the committees are identified in the following table:
Executive/Compensation/ Audit/Examining Nominating/Corporate Pension
Director Personnel Governance Investment Review
----------------------------------------------------------------------------------------------------------------
John E. Alexander -- X X --
James J. Byrnes -- -- -- Chair
Reeder D. Gates X -- X --
William W. Griswold(1) Chair Alternate -- --
Elizabeth W. Harrison -- -- Alternate --
Bonnie H. Howell X Chair -- --
Hunter R. Rawlings, III -- -- -- X
Thomas R. Salm X X Chair X
Craig Yunker X -- -- --
(1) Mr. Griswold is not standing for re-election to the Board of Directors this
year; accordingly, Mr. Griswold's committee membership will terminate effective
as of the date of the 2006 Annual Meeting of Stockholders.
The Executive/Compensation/Personnel Committee met sixteen times during fiscal
2005. Among its duties and responsibilities, this committee assesses the
performance and reviews, determines and recommends salaries and other matters
relating to executive compensation, including the compensation of the Company's
Chief Executive Officer. It also administers the Company's stock option plans,
including reviewing and granting stock options to executive officers and other
employees. This committee also reviews and approves various other Company
compensation policies and matters, senior management planning, and is
responsible for assuring that the Company's executive officers are compensated
effectively and in a manner consistent with the Company's objectives. Each of
the members of this committee is an "independent director" as defined in Section
121A of the AMEX listing standards. For more information about the duties and
responsibilities of this committee, see "Report of the
Executive/Compensation/Personnel Committee of the Board of Directors," included
in this proxy statement.
The Board of Directors has adopted a written charter for the Audit/Examining
Committee. A copy of the Audit/Examining Committee's charter was included as
Appendix A in the Company's proxy statement, filed with the Securities and
Exchange Commission (the "SEC") on April 6, 2004. The Audit/Examining Committee
met five times during fiscal 2005. This committee assists the Board in its
general oversight of the Company's accounting and financial reporting, internal
controls and audit functions, and is directly responsible for the appointment,
compensation and oversight of the work of the Company's independent auditors.
The responsibilities and activities of the Audit/Examining Committee are
described in greater detail in the "Report of the Audit/Examining Committee of
the Board of Directors" included in this proxy statement. The Board of Directors
has determined that John E. Alexander, William W. Griswold and Bonnie H. Howell
each qualify as an "audit committee financial expert" as defined in Item 401(h)
of Regulation S-K and that each of the members of the Audit/Examining Committee
satisfies the independence standards of Section 121A of the AMEX listing
standards and Rule 10A-3 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act").
The Board of Directors has adopted a written charter for the Nominating and
Corporate Governance Committee. A copy of the Nominating and Corporate
Governance Committee's charter is posted in the "Corporate Governance" section
of the Company's Investor Relations website (www.tompkinstrustco.com). The
Nominating and Corporate Governance Committee met three times during the 2005
fiscal year. This committee is responsible for assisting the Board in developing
corporate governance policies and practices that are compliant with applicable
laws and regulations, including AMEX listing requirements and the corporate
governance requirements of the Sarbanes-Oxley Act of 2002. In addition, this
committee is responsible for making recommendations to the Board regarding Board
membership and composition. This committee establishes procedures for the
nomination process and nominates or recommends to the Board qualified candidates
for election to the Board.
8
The process for selecting director nominees entails making a preliminary
assessment of each candidate based upon his or her qualifications, willingness
to serve on the Board, and other background information. This information is
then evaluated against the criteria set forth below, as well as the specific
needs of the Company at that time. Based upon this preliminary assessment,
candidates who appear to be the best fit may be interviewed. If the director
nominee is a current Board member, the committee will also consider prior Board
performance and contributions. At the conclusion of this process, the committee
will nominate qualified candidate(s) that best meet(s) the Company's needs to
the Board for election at the next annual meeting of stockholders. The committee
uses the same process for evaluating all candidates, whether recommended by
stockholders, directors or management.
The minimum qualifications and attributes that the committee believes must be
possessed by a director nominee include: highest personal values, judgment and
integrity; an understanding of the regulatory and policy environment in which
the Company conducts its business; an understanding of, and interest in, the
communities served by the Company; and experience in the key business, financial
and management challenges that face financial service companies.
The committee considers nominees proposed by stockholders. To recommend a
prospective nominee for the committee's consideration, stockholders should
submit the candidate's name and qualifications to: Chairman, Nominating and
Corporate Governance Committee, Tompkins Trustco, Inc. Board of Directors, P.O.
Box 460, Ithaca, New York 14851. Each member of this committee is an
"independent director" as defined in Section 121A of the AMEX listing standards.
The Pension Investment Review Committee met two times during fiscal 2005. This
committee is responsible for reviewing the assets held in the Tompkins Trustco,
Inc. Retirement Plan.
Director Compensation
It is the general policy of the Board that compensation of non-employee
directors should consist of equity-based compensation in order to better align
directors' interests with those of the Company's stockholders. It is also the
general policy of the Board that employee directors are not paid for their
service on the Company's Board of Directors in addition to their regular
employee compensation.
Fees Paid to Directors
During fiscal 2005, the following fees were paid to non-employee directors of
the Company for their service in such capacity:
o A meeting fee of $1,000 for each Board meeting attended;
o A meeting fee of $275 for each committee meeting attended (except
Audit/Examining Committee). Members of the Audit/Examining Committee
received a meeting fee of $600 for each Audit/Examining Committee
meeting attended;
o A $1,750 quarterly retainer fee for service as a director; and
o An annual Chair fee of $1,000 was paid to Thomas Salm for his service
as Chair of the Nominating and Corporate Governance Committee; an
aggregate annual Chair fee of $2,500 was paid for service as Chair of
the Audit/Examining Committee as follows: $625 was paid to William
Griswold for his service as Chair of the Audit/Examining Committee in
the first quarter of fiscal 2005, and an aggregate fee of $1,875 was
paid to Bonnie Howell for her service as Chair of the Audit/Examining
Committee during the second, third and fourth quarters of fiscal 2005.
In addition, Ms. Howell was paid a annual retainer fee of $4,500 for her service
as Vice Chair of the Board of Directors in the first quarter of fiscal 2005, and
Mr. Griswold was paid an aggregate annual retainer fee of $13,500 for his
service as Vice Chair of the Board of Directors during the second, third and
fourth quarters of fiscal 2005. Mr. Griswold was also paid $10,000 for his
service on the Executive/Compensation/Personnel Committee's management
succession project completed in fiscal 2005. Director Hardie was paid meeting
fees and an annual retainer for his service on the Company's Board of Directors.
Aggregate Fees Paid to Directors by the Company
Aggregate fees paid by the Company, including retainer, meeting, chair and/or
committee fees, to all non-employee directors, and Mr. Hardie, in fiscal 2005
were $179,600.
Timing and Manner of Payment
All retainer and meeting fees, including those paid to Ms. Howell and Mr.
Griswold, are paid quarterly by the Company. Mr. Griswold's fee for his services
on the Executive/Compensation/Personal Committee with respect to completion of
the management succession project was paid during the first quarter of fiscal
2006. All board/committee fees and retainers earned by directors are paid in
accordance with the Retainer Plan, which provides that: (i) all such
board/committee fees and retainers shall be paid in shares of Common Stock of
the Company and (ii) the receipt of payment by directors of board/committee fees
and retainers shall be deferred automatically pursuant to the terms of the
Retainer Plan. Under the Retainer Plan, board/committee fees and retainers are
transferred to a rabbi trust; and the trustee of the rabbi trust acquires shares
of the Company's Common Stock for each director's deferred compensation account
9
on the open market pursuant to the Company's Dividend Reinvestment and Stock
Purchase and Sale Plan. A director has no rights in or to the shares of Common
Stock held in the rabbi trust. A director does have the right, however, to the
payment of his or her deferred compensation upon the earlier of the director's
termination of service as a director of the Company; the director's attainment
of the age of 72 years; or the director's death. An aggregate of 4,111.25 shares
of Common Stock was acquired by the rabbi trust under the Retainer Plan
representing board/committee fees and retainers paid in fiscal 2005.
Changes to Company Director Compensation for Fiscal 2006
Effective as of January 1, 2006, non-employee directors will receive a quarterly
retainer fee of $1,750 for each fiscal quarter, including the first fiscal
quarter, and $1,000 for each Board meeting attended. The Vice Chair will be paid
an annual retainer of $18,000, in lieu of all meeting, Chair and committee fees.
Each non-employee director will receive a meeting fee of $275 for each committee
meeting attended (except Audit/Examining Committee). Members of the
Audit/Examining Committee receive a meeting fee of $600 for each Audit/Examining
Committee meeting attended. The Chair of the Audit/Examining Committee will be
paid a fee of $2,500. Mr. Hardie will be paid a quarterly retainer of $1,750 for
each fiscal quarter and will receive $1,000 for each Board meeting attended. All
fees will be paid pursuant to the Retainer Plan as described above under "Timing
and Manner of Payment." In addition to director's fees, directors are eligible
to receive options granted pursuant to the Company's 2001 Stock Option Plan.
Subsidiary Board Service
John E. Alexander, Reeder D. Gates, William W. Griswold, Bonnie H. Howell,
Hunter R. Rawlings, III and Thomas R. Salm also served as directors of Tompkins
Trust Company during fiscal 2005. Tompkins Trust Company paid Messsrs.
Alexander, Gates, Rawlings and Salm, in consideration of their service as
members of Tompkins Trust Company's board of directors, a $6,000 annual retainer
fee, and paid Mr. Griswold and Ms. Howell annual retainer fees of $1,500 and
$4,500, respectively, when they were not serving as Vice Chair. All Tompkins
Trust Company directors, other than Mr. Griswold and Ms. Howell when they were
serving as Vice Chair, were paid a $600 meeting fee for each board meeting
attended in fiscal 2005. The $6,000 annual retainer fee paid by Tompkins Trust
Company to each of Messrs. Alexander, Gates, Rawlings and Salm and, in the
aggregate, to Mr. Griswold and Ms. Howell, was paid pursuant to the Retainer
Plan as described above under "Timing and Manner of Payment", and an aggregate
of 691.50 shares of Common Stock were acquired by the Rabbi Trust under the
Retainer Plan representing such retainer fees. Meeting and committee fees were
paid in cash or deferred through the Tompkins Trust Company Deferred
Compensation Plan [cash deferred]. Ms. Howell was paid a fee of $2,750 in cash
for her service as Vice Chair of the Board of Directors of Tompkins Trust
Company during the first quarter of fiscal 2005, and Mr. Griswold was paid a fee
of $2,750 quarterly in cash for his service as Vice Chair of the Board of
Directors of Tompkins Trust Company during the second, third and fourth quarters
of fiscal 2005.
Elizabeth W. Harrison and Craig Yunker also served as directors of The Bank of
Castile during fiscal 2005 and were each paid a $6,000 annual retainer fee and a
$600 meeting fee by The Bank of Castile in consideration of their service as
members of The Bank of Castile's board of directors. All retainer and meeting
fees paid to such directors by The Bank of Castile were paid in cash.
Michael H. Spain and William D. Spain also served as directors of Mahopac
National Bank during fiscal 2005 and were each paid an annual retainer fee of
$17,000 by Mahopac National Bank in consideration of their service as members of
Mahopac National Bank's board of directors. All retainer and meeting fees paid
to such directors by Mahopac National Bank were paid in cash.
Corporate Governance Matters
Stockholder Communications with Directors
Stockholders may communicate with the Company's Board of Directors by writing to
the following address: Board of Directors, Tompkins Trustco, Inc., P.O. Box 460,
Ithaca, New York 14851. Both the Chairman and Vice Chair of the Company will
review all correspondence and will determine whether the correspondence should
be presented to the full Board. If either of them determines that a
communication should be reviewed by the full Board of Directors, it will be
presented to the Board for its review and consideration.
Policy Regarding Directors Attendance at Annual Meetings
The Company does not have a formal policy in place requiring the attendance of
all directors at annual meetings of stockholders, although the Board strongly
encourages such attendance. Code of Ethics
The Board of Directors has adopted the Tompkins Trustco Inc. Code of Ethics for
Chief Executive Officer and Senior Financial Officers which applies to the
Company's Chief Executive Officer and Chief Financial Officer. A copy of the
Code of Ethics is available in the "Corporate Governance" section of the
Company's Investor Relations website (www.tompkinstrustco.com). The Company
intends to post amendments to or waivers from the Code of Ethics for Chief
Executive Officer and Senior Financial Officers at this location on its website.
10
EXECUTIVE COMPENSATION
Report of the Executive/Compensation/Personnel Committee of the Board of
Directors
The information contained in this report shall not be deemed to be "soliciting
material", or "filed" or incorporated by reference in future filings with the
Securities and Exchange Commission (the "SEC"), or subject to the liabilities of
Section 18 of the Exchange Act, except to the extent that the Company
specifically requests that such information be treated as "soliciting material"
or specifically incorporates it by reference into a document filed under the
Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act.
Overview of Executive Compensation Goals and Objectives
The Executive/Compensation/Personnel Committee (the "Compensation Committee") is
responsible for determining and recommending to the full Board the compensation
of the Company's executive officers, including the executive officers identified
in the Summary Compensation Table. A goal of the Compensation Committee is to
maintain executive compensation that is fair and reasonable, consistent with the
Company's size and the compensation practices of the financial services industry
generally. A key objective of the Compensation Committee is to attract, develop
and retain high caliber executives who are capable of maximizing the Company's
performance for the benefit of its stockholders. In furtherance of this
objective, the Compensation Committee periodically compares its compensation
levels, practices and financial performance to those of a select group of
banking institutions of similar size, geographic market and business makeup.
Toward that end, the Compensation Committee considered the compensation
practices of approximately 10 banking companies which it believed were
reasonably comparable to the Company's asset size and performance and which were
located in the northeast, primarily in New York State. The pertinent information
pertaining to the companies forming the comparative group considered by the
Compensation Committee was gathered from information available to the public and
from a survey developed by the Independent Bankers Association of New York
(IBANYS) which survey provided information about the compensation practices of
community banking institutions in New York State.
Based upon the information reviewed by the Compensation Committee, the
Compensation Committee believes the Company's executive compensation practices
for fiscal 2005 were appropriate.
Components of Executive Compensation
The three major components of the Company's executive officer compensation are:
(i) base salary, (ii) annual bonus and (iii) long-term, equity-based incentive
awards.
Base salary. The Compensation Committee annually reviews the salaries of the
Company's executives. When setting base salary levels for recommendation, the
Compensation Committee considers (a) competitive market conditions for executive
compensation, (b) the Company's performance and (c) the individual's
performance. The Company's performance is measured by the Company's strategic
and financial performance in the fiscal year, with particular emphasis on
earnings per share growth and return on stockholders' equity for the year.
Although the Compensation Committee considers year-to-year changes in stock
price in its evaluation of Company performance, the Committee does not emphasize
this criterion because the Committee does not believe that short-term
fluctuations in stock price necessarily reflect the underlying strength or
future prospects of the Company. Individual performance is measured by the
strategic and financial performance of the particular executive officer's
operational responsibility in comparison to targeted performance criteria.
Annual bonus. The Company's payment of annual cash bonuses seeks to motivate
executives to work effectively to achieve the Company's financial performance
objectives and to reward them when objectives are met.
Long-term, equity-based awards. The Compensation Committee believes that stock
option grants (1) align executive's interests with stockholder interests by
creating a direct link between compensation and stockholder return, (2) give
executives a significant, long-term interest in the Company's success and (3)
help retain key executives in a competitive market for executive talent. While
the Compensation Committee recognizes that the executives of the Company can
exert very little influence on short-term fluctuations in stock price, the
Compensation Committee does believe that long-term stock price appreciation
reflects achievement of strategic goals and objectives. Stock option awards are
based on the performance of the individual executive and his or her anticipated
contribution to the achievement of the Company's strategic goals and objectives.
In addition to stock options, executives may receive Common Stock through the
profit sharing component of the Tompkins Trustco Inc. Employee Stock Ownership
Plan.
Executive Compensation for Fiscal 2005
In determining the compensation for the Company's executive officers for fiscal
2005, including the compensation of the Company's Chief Executive Officer, the
Compensation Committee considered, but did not formally weigh, a number of
quantitative and qualitative performance factors to evaluate the performance of
its executive officers, including its Chief Executive Officer.
The performance factors considered include (1) the Company's net income for
fiscal 2005 as compared to the Company's internal targets; (2) increases in
earnings per share of the Company's Common Stock for the latest 12 months; (3)
the Company's return on assets, as ranked in the Federal Reserve Bank Holding
Company Performance Report (Peer Group Percentile); (4) increases in the
Company's stock price over 12 months; and (5) the Company's return on equity, as
11
ranked in the Federal Reserve Bank Holding Company Performance Report (Peer
Group percentile). The Compensation Committee believes that the total
compensation provided to the Company's executive officers is competitive and
reflects the Company's performance.
This report was prepared by the Executive/Compensation/Personnel Committee of
the Board of Directors.
Members of the Compensation Committee:
William W. Griswold, Chair
Bonnie H. Howell
Reeder D. Gates
Thomas R. Salm
Craig Yunker
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee for the 2005 fiscal year were William
W. Griswold (Chair), Bonnie H. Howell, Reeder D. Gates, Thomas R. Salm and Craig
Yunker. No member of the Compensation Committee was at any time during fiscal
2005 or has been at any other time an officer or employee of the Company or any
of the Company's subsidiaries. No executive officer of the Company has served on
the board of directors or compensation committee of any other entity that has or
has had one or more executive officers who served as a member of the Company's
Board of Directors or the Compensation Committee during fiscal 2005.
12
Summary Compensation Table
The following table sets forth information concerning the compensation paid by
the Company for each of the fiscal years ended December 31, 2005, 2004 and 2003,
to its Chief Executive Officer and to each of its four other most highly
compensated executive officers (based on total salary and bonus for the last
completed fiscal year) (the "Named Executive Officers") who were serving as
executive officers at the end of the fiscal year ended December 31, 2005, and
whose compensation exceeded $100,000.
Annual Compensation All Other Compensation
----------------------------------------------------------------------------------------------------------
Securities
Other Annual Underlying All Other
Name and Principal Year Salary Bonus(1) Compensation(2) Options(#)(3) Compensation(4)
Position
----------------------------------------------------------------------------------------------------------
James J. Byrnes 2005 $437,000 $189,600 0 0 $49,141
Chairman & CEO of 2004 415,000 189,600 0 0 46,923
the Company, 2003 395,000 165,000 704,512 0 41,922
Chairman of the
Board of Tompkins
Trust Company
Stephen E. Garner 2005 $265,000 $ 80,000 $ 73,606 0 $31,682
President & CEO of 2004 252,000 80,000 63,070 14,850 30,682
Tompkins Trust 2003 240,000 75,000 0 0 28,322
Company
James W. Fulmer 2005 $230,000 $ 80,000 $ 0 0 $26,202
President of the 2004 216,000 80,000 156,743 11,000 26,032
Company, Chairman, 2003 206,000 75,000 0 0 21,281
President & CEO of
The Bank of Castile
Stephen S. Romaine 2005 $197,000 $ 50,000 $242,320 0 $23,013
President & CEO of 2004 175,000 48,000 0 11,880 21,304
Mahopac National 2003 157,000 47,000 0 0 17,013
Bank
Francis M. Fetsko 2005 $180,000 $ 45,000 $ 9,142 0 $20,951
Executive Vice 2004 167,000 45,000 0 9,900 20,288
President 2003 150,000 35,500 26,730 0 17,470
& Chief Financial
Officer of the
Company and
Tompkins Trust
Company
(1) These amounts represent cash awards for performance bonuses, including
amounts of such bonuses deferred under the Tompkins Trustco, Inc. Deferred
Compensation Plan for Selected Officers. No interest paid on such deferred
compensation is reported, because such interest does not exceed 120% of the
most closely corresponding long-term federal rate.
(2) In accordance with SEC rules, amounts received for perquisites (which
includes such items as car allowance and club dues) and other personal
benefits with a value equal to the lesser of $50,000 or 10% of the total
annual salary and bonuses reported for a Named Executive Officer are not
included. "Other Annual Compensation" in fiscal 2005, reflects value
realized as a result of stock options exercised by Mr. Garner, Mr. Romaine
and Mr. Fetsko of $65,469, $239,977 and $9,142, respectively
(3) Where applicable, adjusted for 10% stock dividend.
(4) Includes (a) amounts matched on salary deferral pursuant to the Company's
Investment and Stock Ownership Plan, (b) amounts paid pursuant to the
profit sharing portion of the Company's Investment and Stock Ownership Plan
and the Company's Employee Stock Ownership Plan, and (c) taxable amounts of
applicable life insurance premiums paid on the Named Executive Officer's
behalf by the Company.
13
Employment Contracts, Termination of Employment and Change-in-Control
Arrangements
The Company has a severance agreement dated September 6, 1989 with James J.
Byrnes, Chairman and Chief Executive Officer, which provides for severance
payments in the event Mr. Byrnes's employment is terminated within two years
after a "change of control" (as that term is defined in the agreement) or Mr.
Byrnes's employment is terminated during a period in which events take place
which seek to effect a change of control. In such circumstance, Mr. Byrnes will
be entitled to a lump sum cash payment equal to approximately three times his
annualized tax-includable compensation (including bonus compensation) for the
five most recent taxable years ending before the date of the change of control,
the immediate vesting of any awards made to Mr. Byrnes as bonus or incentive
compensation and not previously paid, the termination of Mr. Byrnes's
participation in any savings and/or profit sharing plan, with terminating
distributions and/or vested rights under such plans to be governed by the terms
of such plans and entitlement to retirement benefits.
Mr. Byrnes is a party to a Supplemental Executive Retirement Agreement with
Tompkins Trust Company, and Messrs. Fulmer, Garner, Romaine and Fetsko are
parties to Supplemental Executive Retirement Agreements with the Company, these
SERP agreements contain change-in-control provisions and are discussed below
under "Supplemental Employee Retirement Plans."
Life Insurance
Life insurance benefits are provided to certain officers of the Company, with
respect to which the Company has entered into life insurance contracts. These
insurance contracts are carried at cash surrender value on the Company's
consolidated statements of condition. Increases in the cash surrender value of
the insurance are reflected as noninterest income, and the related mortality
expense is recognized as other employee benefits expense, in the Company's
consolidated statements of income. Taxable amounts paid with respect to such
life insurance on behalf of the Named Executive Officers are included as "All
Other Compensation" in the Summary Compensation Table, above.
Stock Option Plan
The Company maintains the Tompkins Trustco, Inc. 2001 Stock Option Plan as a
vehicle to encourage the continued employment of key employees of the Company
and its subsidiaries, and to align their interests with those of the Company's
stockholders by facilitating their purchase of a stock interest in Tompkins
Trustco. Management believes that an incentive stock option plan is in the best
interests of the Company and its stockholders since it will enhance the
Company's ability to continue to attract and retain qualified directors,
officers and other key employees.
Option Grants in Fiscal 2005
No options were granted to Named Executive Officers during fiscal 2005.
Outstanding Options of Named Executive Officers
The following table shows the aggregate number of options outstanding as of
December 31, 2005 for each of the Named Executive Officers, and for all
executive officers of the Company as a group.
Number of Options Average Price Per
Name Outstanding Option Outstanding ($) (1)
-------------------------------------------------------------------------------------------
James J. Byrnes 12,100 31.200
Stephen E. Garner 53,245 30.0037
James W. Fulmer 40,040 27.843
Stephen S. Romaine 21,258 39.3968
Francis M. Fetsko 27,171 35.2283
All executive officers as a group 241,349 32.360 (2)
(1) This price represents the weighted average of the fair market value, as
that term is defined in the stock option plan, of the Common Stock of the
Company on the date that the options were granted.
(2) This price represents a weighted average of the exercise price of all of
the options outstanding to all executive officers of the Company as of
December 31, 2005.
Options Exercised and Value for Fiscal 2005
The following table sets forth information concerning the exercise of options by
each Named Executive Officer during fiscal 2005 and the potential value of
unexercised "in-the-money" options held by them as of the end of the fiscal
year. Options are "in-the-money" if the fair market value of the underlying
shares of Common Stock exceeds the exercise price of the option. The value of
exercised options represents the difference between the fair market value of the
shares of Common Stock on the date of exercise less the aggregate exercise price
established on the grant date. The value of unexercised "in-the-money" options
is based on the average price of the Company's Common Stock on December 31,
2005, the last trading day of fiscal 2005, of $44.80(1) per share, minus the
exercise price, multiplied by the number of shares of Common Stock issuable upon
exercise of the option. These values have not been, and may never be, realized.
14
Aggregated Option Exercises During Fiscal 2005 and Option Values
on December 31, 2005(1)
Number of Value of
Securities Unexercised In-
Underlying the-Money Options
Unexercised at 12/31/05 ($)(1)
Options at
12/31/05(#)
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise (#) Realized ($) Unexercisable Unexercisable
-------------------------------------------------------------------------------------------------
James J. Byrnes -- -- 9,075/3,025 $123,420/$41,140
Stephen Garner 2,390 $65,469 30,830/22,415 $687,946/$99,884
James W. Fulmer -- -- 29,040/11,000 $662,112/$16,830
Stephen S. Romaine 10,460 $239,977 4,689/16,569 $48,343/$66,519
Francis M. Fetsko 425 $9,141 12,582/14,589 $196,582/$63,490
(1) Price adjusted for 10% stock dividend paid 2/15/05.
Deferred Profit-Sharing Plan
The Company has an Investment and Stock Ownership Plan (the "ISOP") that covers
substantially all of the employees of the Company and its subsidiaries. The ISOP
is a profit-sharing plan with a salary deferral arrangement meeting the
requirements of Section 401(k) of the Internal Revenue Code of 1986, as amended.
Pursuant to the ISOP, an employee may defer a portion of the employee's base
pay, within limits specified in the ISOP. The ISOP further provides that the
Company will match 100% of an employee's contribution up to 3% of the employee's
base pay, and will match 50% of an employee's additional contribution to the
ISOP that is greater than 3%, but not more than 5%, of the employee's base pay.
In addition, the ISOP has an employer-funded profit sharing component. Profit
sharing contributions are discretionary contributions determined by the
Company's Board of Directors and are limited to a maximum amount as stipulated
in the ISOP. The ISOP allows employees to elect to defer a portion of their
profit sharing component (which deferral is not eligible for matching by the
Company), or to receive cash. Amounts contributed by the Company for the
accounts of the Named Executive Officers are included as "All Other
Compensation" in the Summary Compensation Table.
The Company also has the Tompkins Trustco, Inc. Employee Stock Ownership Plan
(the "ESOP") which covers substantially all employees of the Company. The
purpose of the ESOP is to permit the Company to make discretionary profit
sharing contributions to employees in the form of shares of Common Stock in
order to facilitate stock ownership by employees. Contributions are determined
by the Company's Board of Directors and are limited to a maximum amount as
stipulated in the ESOP. Amounts accrued for the accounts of the Named Executive
Officers are included as "All Other Compensation" in the Summary Compensation
Table.
Retirement Plan
The Company has a non-contributory pension equity plan, the Tompkins Trustco,
Inc. Retirement Plan (the "Retirement Plan"), which covers substantially all
employees of the Company. The assets of the Retirement Plan are held in a
separate trust and administered by the Pension Investment Review Committee of
the Board of Directors.
Tompkins Trustco, Inc. Retirement Plan Table(1)
Years of Service
Average Final 15 20 25 30 35
Earnings
--------------------------------------------------------------------------------
$ 50,000.00 5,705 7,588 9,815 11,750 14,187
$ 75,000.00 9,708 12,891 16,640 19,887 23,965
$100,000.00 13,711 18,193 23,465 28,024 33,743
$125,000.00 17,714 23,495 30,290 36,162 43,521
$150,000.00 21,717 28,798 37,114 44,299 53,299
$175,000.00 25,720 34,100 43,939 52,436 63,077
$200,000.00 29,724 39,402 50,764 60,574 72,855
(1) A "grandfathering" multiplier based on age and service as of January 1,
2001 will increase the benefits of certain Tompkins Trust Company employees
covered under the previous Tompkins County Trust Company Retirement Plan,
including Mr. Byrnes and Mr. Fetsko.
The Retirement Plan provides a retirement benefit based on "Points" defined in
the Retirement Plan as a combination of age plus years of service, multiplied by
"Average Final Earnings," as that term is defined in the Plan. The benefits are
not subject to a reduction for federal social security benefits.
15
Generally, compensation used for determination of benefits under the Retirement
Plan includes regular annual earnings and, as to the Named Executive Officers,
all other payments of compensation from the Company, as reported in all columns
of the Summary Compensation Table above. However, taxable compensation from
stock options is excluded for all participants and, for highly compensated
employees, which includes all of the Named Executive Officers, incentive bonus
compensation and taxable fringe amounts are excluded. The annual compensation
used for benefit computations of each employee under the plan will not exceed
the IRC section 401(a)(17) annual compensation limit. Considering these limits,
the five (5) year average annual compensation for plan years 2001-2005 is
$197,000. As of December 31, 2005, Mr. Byrnes had 17 years of credited service
under the Retirement Plan and his average annual compensation for purposes of
the Retirement Plan was $197,000; Mr. Garner had 5 years of credited service
under the Retirement Plan and his average annual compensation for purposes of
the Retirement Plan was $197,000; Mr. Fulmer had 17 years of credited service
under the Retirement Plan and his average annual compensation for purposes of
the Retirement Plan was $192,275; Mr. Romaine had 5 years of credited service
under the Retirement Plan and his average annual compensation for purposes of
the Retirement Plan was $163,656; and Mr. Fetsko had 9 years of credited service
under the Retirement Plan and his average annual compensation for purposes of
the Retirement Plan was $155,284. Certain of the Company's employees, including
Messrs. Byrnes and Fetsko, are covered by the Retirement Plan's "grandfathering"
provisions, as a result of which their accrued benefit is increased by 100% and
60% respectively.
Under the plan, normal retirement age is 65 with reduced benefit payments for
early retirement following age 55 to age 65.
Supplemental Employee Retirement Plans
Tompkins Trust Company has a Supplemental Executive Retirement Agreement with
Mr. Byrnes dated July 12, 1994. This SERP agreement provides Mr. Byrnes: (i)
with an annual retirement benefit at age 65 equal to 50% of his highest average
earnings (as defined in the SERP agreement) using five consecutive calendar
years of his employment with Tompkins Trust Company, less (a) benefits payable
to Mr. Byrnes under Tompkins Trust Company's retirement plan and (b) social
security benefits. The retirement benefit is payable monthly and subject to
reduction in the event Mr. Byrnes retires prior to age 65; (ii) in the event of
(a) short-term disability, with benefits in an amount sufficient to continue Mr.
Byrnes's annual earnings immediately prior to such disability (taking into
account disability benefits otherwise payable under Tompkins Trust Company's
disability policies) for a period of up to 26 weeks and, (b) long-term
disability, with benefits equal to those payable upon retirement, without regard
to age, but subject to reduction of long-term disability payments; and (iii) in
the event of a change in control, as defined in Mr. Byrnes's severance
agreement, with a single, lump-sum distribution equal to the present value of
the annual retirement benefit otherwise payable to Mr. Byrnes upon retirement at
age 65. Except in the event of a change in control, no benefits are payable
under the SERP agreement if Mr. Byrnes's employment is terminated for cause, or
he engages in competition (as defined in the SERP agreement) with Tompkins Trust
Company or he performs acts of willful malfeasance or gross negligence in a
matter of material importance to Tompkins Trust Company. Mr. Byrnes's SERP
agreement is not an employment agreement and does not confer upon him any right
to continued employment.
The projected annual retirement benefit to Mr. Byrnes at age 65 is currently
$294,764, inclusive of payments from the Tompkins Trust Company's retirement
plan, the SERP aggreement and social security.
In December 2005, Messrs. Fulmer, Garner, Romaine and Fetsko, each a Named
Executive Officer, entered into Supplemental Executive Retirement Agreements
with the Company, which, among other things, replaced the SERP agreements and
employment agreements that were previously in place with Mr. Fulmer, Mr. Garner
and Mr. Romaine. The December 2005 SERP agreements provide the covered executive
officers with the following retirement, death, disability and change of control
benefits:
o Retirement Benefits. Upon their retirement, covered executive officers
are eligible to receive payment of his or her annual retirement benefit amount,
which is equal to 75% of the executive's earnings, less (a) the annual amount
payable under any single life annuity provided under the Company's Retirement
Plan and (b) any social security benefits. The retirement benefit is payable
monthly until the executive officer's death and is subject to reduction
depending upon the executive's age and years of service as of the date of his or
her retirement. For purposes of this benefit, an executive officer's "earnings"
will be the average of the executive officer's five highest calendar years of
base salary. The projected annual retirement benefit to Mr. Fulmer at age 65 is
currently $172,500; the projected annual retirement benefit to Mr. Garner at age
65 is currently $198,750; the projected annual retirement benefit to Mr. Romaine
at age 65 is currently $147,750; and the projected annual retirement benefit for
Mr. Fetsko at age 65 is currently $135,000. All these amounts are inclusive of
payments from the Company's Retirement Plan, SERP agreements and social security
benefits.
o Death Benefits. In the event of the covered executive officer's death
(i) after retirement, his or her spouse will be paid (monthly) 50% of the
executive officer's annual retirement benefit until the spouse's death, and (ii)
prior to retirement, his or her spouse will be paid (monthly) 50% of the vested
portion of the executive officer's annual retirement benefit until the spouse's
death, provided the spouse survives until the executive officer's designated
retirement age in the SERP agreement.
16
o Disability Benefits. Upon a covered executive officer becoming
disabled, he or she is entitled to payment of his or her retirement benefits
commencing at the executive officer's designated retirement date in the SERP
agreement, but with the assumption that the executive officer has completed 20
yeas of service and is 100% vested in the benefit under the SERP agreement as of
the date of his or her disability. In the event of the executive officer's death
after disability, the executive officer's spouse will be entitled to payment of
the death benefits described above.
o Change of Control Benefits. In the event of a change in control, the
covered executive officer will be deemed to have completed twenty (20) years of
service and will be 100% vested in the benefit under the SERP agreement. Covered
executive officers could be entitled to certain severance benefits following a
change of control of the Company (as defined in the SERP agreements). If, within
three years following a change in control the executive officer is terminated,
other than for cause and subject to the discretion of the Company's executive
committee, or, the executive officer's role or compensation is significantly
reduced, then for a period of three years, the executive officer is entitled to
(a) payment of his or her base salary in effect immediately prior to the change
in control, but subject to reduction by 20% to 100% depending on the executive's
age at the time of his or her termination, (b) the executive's bonus and profit
sharing compensation, which will be the average of the executive's bonus and
profit sharing compensation earned for the two most recently completed fiscal
years of the Company and (c) continuation of all welfare benefits that he or she
was participating in immediately prior to the change in control.
In addition, the SERP agreements with Messrs. Fulmer, Garner, and Romaine
provide that in the event the executive officer's employment is terminated
without cause (other than upon a change of control, death or disability), then
the executive officer is entitled to (a) payment of his or her base salary in
effect immediately prior to the executive officer's termination of employment
and (b) participate (but not required) in the Company's welfare benefits. These
severance benefits are payable for a period of 24 months to Mr. Fulmer, 18
months to Mr. Garner and 12 months to Mr. Romaine.
Further, under the SERP agreements, in the event Messrs. Fulmer's, Romaine's,
Garner's or Fetsko's employment is involuntarily terminated (other than for
cause) at any time, or voluntarily terminated after reaching age 55 and after
completing 10 years of service, but prior to his designated retirement age in
his SERP agreement, he will be entitled to payment of his retirement benefits on
his designated retirement date, or, in the event of his death, his spouse will
be entitled to payment of the death benefits described above.
No benefits are payable under the SERP agreements if the covered executive
officer's employment is terminated for cause, or he or she engages in
competition with the Company. And, if the executive officer voluntarily
terminates his or her employment before age 55 and before completion of 10 years
of service, other than because of death, disability or change of control, he or
she will not be entitled to payment of any retirement benefits. The SERP
agreements are not employment agreements and do not confer upon the covered
executive officers any right to continued employment with the Company or any of
its subsidiaries.
Deferred Compensation Plan for Selected Officers
The Company maintains a nonqualified deferred compensation plan for a select
group of officers. This plan allows participating employees to defer receipt of
all or a portion of bonuses and profit sharing payments otherwise payable to
them until a future date. The Investment Committee, which is a subcommittee of
the Executive/Compensation/Personnel Committee, directs the investment of these
monies. Amounts deferred under the deferred compensation plan on the part of the
Named Executive Officers are included as "Bonus" in the Summary Compensation
Table.
Post-Retirement Life Insurance and Medical Insurance
The Company offers post-retirement life insurance coverage to employees who have
worked for the Company for 10 or more years and who retire at or after age 55.
All of the Named Executive Officers are entitled to receive life insurance
coverage under this policy.
Additionally, Tompkins Trust Company offers post-retirement medical coverage to
certain employees. Retiree medical insurance subsidized by the Company has been
eliminated for new hires after December 31, 2004. The current Tompkins Trust
Company retirees and active eligible employees (at least 55 years of age and 10
years of service as of December 31, 2004) are a "grandfathered group" and as
such continue to receive a portion of their retiree medical benefit from the
Company. There is currently a $3,000 annual cap on the employer payments. The
plan of benefits and the employer subsidy will be evaluated annually. All other
active employees received a notional Health Reimbursement Account (HRA). Monies
in this account will be available to individuals who retire from the Company.
The FAS 106 APBO that is attributable to each employee determined the amount of
"seed money" for these HRA's.
17
EQUITY COMPENSATION PLAN INFORMATION
The following table summarizes information, as of December 31, 2005, relating to
equity compensation plans of the Company pursuant to which grants of options,
restricted stock units or other rights to acquire shares may be granted from
time to time.
Equity Compensation Plan Information
Number of securities
Number of securities remaining available for
to be issued Weighted-average future issuance under
upon exercise of exercise price of equity compensation plans
Plan Category outstanding options, outstanding options, (excluding securities
warrants and rights warrants and rights (1) reflected in column (a))
(a) (b) (c)
---------------------------------------------------------------------------------------------------------------------
Equity compensation 571,694 $34.3485 580,377
plans approved by
security holders(2)
Equity compensation 0 0 0
plans not approved by
security holders
Total 571,694 $34.3485 580,377
(1) This price represents the weighted average exercise price of all
outstanding options.
(2) Includes the Tompkins Trustco, Inc. 2001 Stock Option Plan, the Tompkins
County Trustco, Inc 1998 Stock Option Plan, and the Tompkins County Trust
Company 1992 Stock Option Plan.
18
STOCK PERFORMANCE GRAPH
The information contained in the Stock Performance Graph section of this proxy
statement shall not be deemed to be "soliciting material", or "filed" or
incorporated by reference in future filings with the SEC, or subject to the
liabilities of Section 18 of the Exchange Act, except to the extent that the
Company specifically requests that such information be treated as "soliciting
materials" or specifically incorporates it by reference into a document filed
under the Securities Act or the Exchange Act.
The following graph sets forth comparative information regarding the Company's
cumulative total stockholder return on its Common Stock over the five-year
period ended December 31, 2005. Cumulative total stockholder return is measured
by dividing cumulative dividends (assuming dividend reinvestment) plus the
change in the Common Stock share price during the measurement period by the
share price at the beginning of the measurement period. The Company's cumulative
total stockholder return for the five-year period based upon an initial
investment of $100 is compared to the cumulative total return of the NASDAQ
Stock Market (U.S. Companies) and the SNL Securities L.P. Bank Index, assuming
the reinvestment of dividends. The stock prices on the performance graph are not
necessarily indicative of future stock price performance.
Total Return Performance
[GRAPHIC OMITTED]
Period Ending
---------------------------------------------------------------
Index 12/31/00 12/31/01 12/31/02 12/31/03 12/31/04 12/31/05
--------------------------------------------------------------------------------------------
Tompkins Trustco, Inc. 100.00 148.51 167.06 196.92 234.79 222.19
NASDAQ Composite 100.00 79.18 54.44 82.09 89.59 91.54
SNL Bank Index 100.00 101.00 92.61 124.93 140.00 141.91
19
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
Company's directors and officers, and persons who own more than 10% of the
Company's Common Stock, to file with the SEC initial reports of ownership and
reports of changes in ownership of the Company's capital stock. Officers,
directors and greater than 10% stockholders are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based upon on a review of the copies of such reports
furnished to the Company and written representations that no other reports were
required, during fiscal 2005 all Section 16(a) filing requirements applicable to
its officers, directors and greater than 10% stockholders were satisfied.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain directors and executive officers of the Company and its affiliated
companies, members of their immediate families and companies or firms with which
they are associated, were customers of, or had other transactions with, the
Company in the ordinary course of business during fiscal 2005. Any and all loans
and commitments to loan to such individuals were made on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with other persons and did not involve more than the
normal risk of collectibility or present other unfavorable features. As of
December 31, 2005, the balance of all such loans included in total loans was
$10,854,000. None of the loans outstanding to directors or executive officers of
the Company, or members of their immediate families or companies or firms with
which they are associated, were nonperforming at December 31, 2005.
Russell K. Achzet, a current director and a director nominee for consideration
at the Meeting, was the founder and the majority shareholder of AM&M Financial
Services, Inc., which the Company acquired, by merger, in January 2006, and is
now a wholly-owned subsidiary of the Company. Under the terms of the agreement
and plan of merger, the Company acquired all of the issued and outstanding
shares of AM&M capital stock, including those shares held by Mr. Achzet, for an
initial consideration of $2,375,000 paid in cash and 53,976 shares of Company
Common Stock. In addition to the merger consideration paid at closing,
additional contingent amounts of up to $8.5 million (payable one-half in cash
and one-half in Company Common Stock) may be paid over a period of four years
from closing. For his ownership interest in AM&M, Mr. Achzet received, as his
portion of the initial merger consideration, $1,687,400 in cash and 33,119
shares of Company Common Stock. Mr. Achzet is also eligible to receive
contingent payments of up to $5.2 million, payable in equal amounts of cash and
Company Common Stock, depending on the earnings performance of AM&M over the
next four years. In connection with the Company's acquisition of AM&M, Mr.
Achzet entered into a consulting agreement with AM&M Financial Services, which
will expire on January 1, 2010. Under the terms of the consulting agreement, Mr.
Achzet will provide certain management consulting and business referral services
for AM&M. In consideration for his services, Mr. Achzet will be paid a monthly
fee, on a declining basis. Mr. Achzet will be paid $9,093 per month in 2006,
$6,360 per month in 2007, $3,363 per month in 2008 and $3,484 per month in 2009.
James R. Hardie, a director of the Company and Vice Chairman of Tompkins
Insurance Agencies, Inc., is the managing member of a limited liability company
that leases space located in Attica, New York, to Tompkins Insurance Agencies.
The total amount paid to the limited liability company in fiscal 2005 was
$27,000. The Company expects to pay $14,400 to the limited liability company in
fiscal 2006. Mr. Hardie continues to be employed by Tompkins Insurance Agencies
as a producer, for which he is paid a nominal annual salary plus benefits
totaling less than $60,000 in fiscal 2005. In addition, Mr. Hardie's son is
employed by Tompkins Insurance Agencies and his annual salary plus commissions
in fiscal 2005 exceeded $60,000.
Michael H. Spain, a director of the Company and of Mahopac National Bank, is the
president and owner of the Spain Agency, Inc. an insurance agency that placed
the Company's current workers compensation and statutory disability insurance
coverage during fiscal 2005. The aggregate of any commissions and/or fees
received by the Spain Agency for the placement of such insurance was less than
$60,000 during fiscal 2005.
William D. Spain, Jr., a director of the Company and a director and Chairman of
Mahopac National Bank, is Managing Partner of Spain & Spain, PC, a firm that
provides legal services to Mahopac National Bank. The fees paid to Spain &
Spain, PC by Mahopac National Bank for legal services during fiscal 2005 were
less than $60,000.
20
REPORT OF THE AUDIT/EXAMINING COMMITTEE OF THE BOARD OF DIRECTORS
The information contained in this report shall not be deemed to be "soliciting
material" or "filed" or incorporated by reference in future filings with the
SEC, or subject to the liabilities of Section 18 of the Exchange Act, except to
the extent that the Company specifically incorporates it by reference into a
document filed under the Securities Act or the Exchange Act.
The Audit/Examining Committee is appointed by the Board of Directors to assist
the Board in fulfilling its oversight responsibilities. The Audit/Examining
Committee is composed of three non-employee directors, all of whom are
"independent directors" under Section 121(A) of the AMEX listing standards and
Rule 10A-3 under the Exchange Act.
The Audit/Examining Committee operates under a written charter approved by the
Board of Directors, a copy of which was included as Appendix A to the Company's
proxy statement, filed with the SEC on April 6, 2004. The Audit/Examining
Committee's primary duties and responsibilities are: to oversee the Company's
accounting and financial reporting process and the audit of the Company's
financial statements and to monitor the integrity of the Company's financial
statements; to monitor the independence and qualifications of the Company's
independent auditor; monitor the performance of the Company's independent
auditor and internal auditing department; provide an avenue of communication
among the Company's independent auditor, management, the internal auditing
department, and the Board of Directors; and to monitor compliance by the Company
with legal and regulatory requirements. The Audit/Examining Committee is also
directly responsible for the appointment and compensation of the Company's
independent auditor.
The Audit/Examining Committee met five times during fiscal 2005 and reports to
the Board of Directors on a quarterly basis. The Audit/Examining Committee
schedules its meetings with a view to ensuring that it devotes appropriate
attention to all of its tasks. The Audit/Examining Committee's meetings include,
whenever appropriate, executive sessions with the Company's independent auditors
and with the Company's internal auditors, in each case without the presence of
the Company's management.
The Audit/Examining Committee has the authority to conduct any investigation
appropriate to fulfilling its responsibilities. It has direct access to the
independent auditors and to any employee or officer of the Company it deems
necessary. The Audit/Examining Committee has the ability to retain, at the
Company's expense and at compensation it deems appropriate, special legal,
accounting, or other consultants or experts it deems necessary in the
performance of its duties.
Management is responsible for the Company's internal controls and financial
reporting process. The Company's independent accountants, KPMG LLP ("KPMG"), are
responsible for performing an independent audit of the Company's consolidated
financial statements and an audit of the Company's internal control over
financial reporting in accordance with auditing standards generally accepted in
the United States of America and to issue reports thereon.
In connection with its responsibilities, the Audit/Examining Committee met with
management and with KPMG to review and discuss the Company's audited
consolidated financial statements for the fiscal year ended December 31, 2005.
The Audit/Examining Committee also discussed with KPMG the matters required to
be discussed by Statement on Auditing Standards No. 61 (Communication with Audit
Committees), received written disclosures and a letter from KPMG required by
Independence Standards Board No. 1 (Independence Discussions with Audit
Committees), and has discussed with KPMG its independence.
Based upon the Audit/Examining Committee's discussions with management, the
Company's internal auditor, and KPMG and the Audit/Examining Committee's review
of the information described in the preceding paragraph, the Audit/Examining
Committee recommended to the Board of Directors that the Company's audited
consolidated financial statements for the fiscal year ended December 31, 2005,
be included in the Company's Annual Report on Form 10-K for the year ended
December 31, 2005, for filing with the SEC.
Members of the Audit/Examining Committee:
Bonnie H. Howell, Chair
John E. Alexander
Thomas R. Salm
William W. Griswold, Alternate
21
INDEPENDENT AUDITORS
The Audit/Examining Committee has retained KPMG LLP ("KPMG") to continue as
independent auditors and to audit the consolidated financial statements of the
Company for the fiscal year ending December 31, 2006. A representative of KPMG
is expected to attend the Meeting and will have an opportunity to make
statements and respond to appropriate questions from stockholders.
Audit and Non-Audit Fees
KPMG is the Company's independent auditor. The following table sets forth the
aggregate fees billed to the Company for the fiscal years ended December 31,
2005 and December 31, 2004 by KPMG:
2005 2004
---- ----
Audit Fees: $ 228,500 $ 226,500
Audit-Related Fees: $ 95,000 $ 225,000
Tax Fees: $ 85,165 $ 83,310
All Other Fees: $ 0 $ 4,900
Audit Fees: These are fees for professional services rendered for the audit of
the Company's consolidated annual financial statements and review of the
consolidated financial statements included in the Company's quarterly reports on
Form 10-Q, and for services that would normally be provided by the Company's
auditor in connection with statutory and regulatory filings or engagements for
the periods covered.
Audit-Related Fees: These are fees for assurance and related services that are
reasonably related to performance of audit or review of the Company's
consolidated financial statements and are traditionally performed by the
Company's independent accountant. More specifically, these include fees billed
for the audit of internal controls over financial reporting in accordance with
the Public Company Accounting Oversight Board, including FDICIA reporting.
Tax Fees: These are fees for professional services rendered regarding tax
compliance, tax advice or tax planning. More specifically, these include fees
billed for tax return preparation, quarterly estimates, tax planning and tax
related research.
All Other Fees: These are fees for all other products and services provided by
the Company's independent accountant that do not fall within the previous
categories. More specifically, these include fees for review of the SEC Form
S-3, Tompkins Trustco, Inc. Dividend Reinvestment and Direct Stock Purchase and
Sale Plan in fiscal 2004.
All non-audit services were reviewed with the Audit/Examining Committee, which
concluded that the provision of such services by KPMG was compatible with the
maintenance of that firm's independence and the conduct of its auditing
functions.
Audit/Examining Committee Pre-Approval Policy
The Audit/Examining Committee pre-approves all audit services and permitted
non-audit services (including the fees and terms of such services) to be
provided to the Company by its independent auditor, other than non-audit
services falling within the de minimis exception described in Section
10A(i)(1)(B) of the Exchange Act which are approved by the Audit/Examining
Committee prior to the completion of the audit. The Audit/Examining Committee
may delegate to one or more designated members of the Audit/Examining Committee
the authority to grant pre-approvals of audit services and permitted non-audit
services, provided that decisions of such designated member(s) to pre-approve
one or more such services shall be reported to the full Audit/Examining
Committee at its next scheduled meeting.
All audit and non-audit services provided by the Company's independent auditor
for fiscal 2005 and fiscal 2004 were pre-approved by the Company's
Audit/Examining Committee.
22
STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company that are intended to be presented by
such stockholders at the Company's 2007 annual meeting and that stockholders
desire to have included in the Company's proxy materials relating to such
meeting must be received by the Company no later than December 8, 2006, which is
120 calendar days prior to the anniversary of the Company's mailing of this
proxy statement, and must be in compliance with applicable laws and regulations
in order to be considered for possible inclusion in the proxy statement and form
of proxy for that meeting.
Under the Company's Bylaws, in order to be deemed properly presented, notice
must be delivered to the Corporate Secretary of the Company at the principal
executive offices of the Company not less than the close of business on the
120th calendar day prior to the date on which the Company first mailed its proxy
materials for this year's Meeting. The stockholder's notice must set forth, as
to each matter the stockholder proposes to bring before the annual meeting (a) a
description in reasonable detail of the business desired to brought before the
annual meeting and the reasons for conducting such business at the annual
meeting, (b) the name and address, as they appear on the Company's books of the
stockholder proposing such business and the beneficial owner, if any, on whose
behalf the proposal is made, (c) the number of shares of the Company that are
owned beneficially and of record by the stockholder proposing such business and
by the beneficial owner, if any, on whose behalf the proposal is made, and (d)
any personal or other material interest of such stockholder proposing such
business and the beneficial owner, if any, on whose behalf the proposal is made
in such business. In addition, a stockholder seeking to submit such business at
an annual meeting shall promptly provide any other information reasonably
requested by the Corporation. If a stockholder gives notice of such a proposal
after the Bylaw deadline, the stockholder will not be permitted to present the
proposal to the stockholders for a vote at the meeting.
In addition, the proxy solicited by the Board of Directors for the 2007 annual
meeting of stockholders will confer discretionary authority to vote on (i) any
proposal presented by a stockholder at that meeting for which the Company has
not been provided with notice prior to December 8, 2006, and (ii) on any other
proposal (notwithstanding timely notice), if the 2007 proxy statement briefly
describes the matter and how management will direct the proxy holders to vote on
it, if the stockholder does not comply with the requirements of Rule 14a-4(c)(2)
under the Securities Exchange Act of 1934, as amended.
FORM 10-K
A copy of the Company's Annual Report on Form 10-K filed with the SEC is
available without charge at our website (http://www.tompkinstrustco.com) or by
writing to: Tompkins Trustco, Inc., ATTN: Francis M. Fetsko, Executive Vice
President & Chief Financial Officer, P.O. Box 460, Ithaca, New York 14851. In
addition, the Annual Report on Form 10-K (with exhibits) is available at the
SEC's Internet site (http://www.sec.gov).
OTHER MATTERS
The Board of Directors knows of no business to be presented for stockholder
action at the Meeting other than the election of directors. If any additional
matters should be presented, it is intended that the enclosed proxy will be
voted in accordance with the judgment of the person or persons acting under the
proxy.
Your vote is important regardless of the number of shares you own. Whether or
not you plan to attend the Meeting, you are urged to vote your proxy promptly.
You may vote by telephone, via the Internet, or mark, sign, date, and return the
enclosed proxy card in the accompanying pre-addressed postage-paid envelope.
Your proxy may be revoked prior to its exercise by filing with the Company's
Corporate Secretary prior to the Meeting a written notice of revocation or a
duly executed proxy bearing a later date, or by attending the Meeting, filing a
written notice of revocation with the Corporate Secretary at the Meeting prior
to the vote, and voting in person.
Dated: April 7, 2006 By Order of the Board of Directors
/s/ LINDA M. CARLTON
------------------------------------------
Linda M. Carlton
Asst. Vice President & Corporate Secretary
23
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P.O. Box 460, Ithaca, New York 14851
(607) 273-3210
www.tompkinstrustco.com
ANNUAL MEETING OF STOCKHOLDERS OF
TOMPKINS TRUSTCO, INC.
May 8, 2006
PROXY VOTING INSTRUCTIONS
COMPANY NUMBER 12037
ACCOUNT NUMBER => | |
CONTROL NUMBER => | |
MAIL - Date, sign and mail your proxy card in the envelope provided as soon as
possible.
- OR -
TELEPHONE - Call toll-free 1-800-PROXIES (1-800-776-9437) from any touch-tone
telephone and follow the instructions. Have your proxy card available when you
call.
- OR -
INTERNET - Access "www.voteproxy.com" and follow the on-screen instructions.
Have your proxy card available when you access the web page.
You may enter your voting instructions at 1-800-PROXIES or www.voteproxy.com up
until 11:59 PM Eastern Time the day before the cut-off or meeting date.
Please detach along perforated line and mail in the envelope provided IF
you are not voting via telephone or the Internet.
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PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR
VOTE IN BLACK OR BLUE INK AS SHOWN HERE [X]
The Board recommends a vote FOR all Director Nominees.
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1. Election of five (5) Directors for a term of three years expiring in 2009:
[ ] FOR ALL NOMINEES NOMINEES:
[ ] WITHHOLD AUTHORITY ( ) Russell K. Achzet
FOR ALL NOMINEES
( ) James W. Fulmer
[ ] FOR ALL NOMINEES EXCEPT
(See INSTRUCTIONS below.) ( ) James R. Hardie
( ) Patricia A. Johnson
( ) Thomas R. Salm
INSTRUCTIONS: To withhold authority to vote for any individual Nominee(s), mark
"FOR ALL NOMINEES EXCEPT" and fill in the circle next to each Nominee(s) with
respect to whom you withhold authority to vote, as shown here: [X]
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment
thereof.
Management at present knows of no other business to be presented at the meeting.
TO INCLUDE ANY COMMENTS, USE THE COMMENTS BOX ON THE REVERSE SIDE OF THIS CARD.
To change the address on your account, please check the box at right and
indicate your new address in the address space above. Please note that changes
to the registered name(s) on the account may not be submitted via this
method. [ ]
Signature of Stockholder _________________Date _______, 2006 Signature of Stockholder __________________ Date________, 2006
NOTE: Please sign exactly as your name or names appear on this Proxy. When
shares are held jointly, each holder should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If
the signer is a corporation, please sign full corporate name by duly authorized
officer, giving full title as such. If signer is a partnership, please sign in
partnership name by authorized person.
TOMPKINS TRUSTCO, INC.
Annual Meeting of Stockholders to be held Monday, May 8, 2006
YOUR VOTING CARD IS ATTACHED BELOW.
You may vote by telephone, via the Internet or by conventional mail.
Please read the other side of this card carefully for instructions.
However you decide to vote, your representation at the
Annual Meeting of Stockholders is important to Tompkins Trustco, Inc.
PROXY/VOTING INSTRUCTION CARD
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
TOMPKINS TRUSTCO, INC.
FOR THE ANNUAL MEETING OF STOCKHOLDERS ON MONDAY, MAY 8, 2006
The undersigned stockholder of TOMPKINS TRUSTCO, INC. (the "Company") hereby
constitutes and appoints Francis M. Fetsko and Linda M. Carlton, and each of
them, as agent and proxy of the undersigned, with full power of substitution and
revocation, to vote all shares of Common Stock of the Company standing in his or
her name on the books of the Company and that the undersigned would be entitled
to vote at the Annual Meeting of Stockholders to be held at 5:30 p.m. at the
Country Club of Ithaca, 189 Pleasant Grove Road, Ithaca, NY, on Monday, May 8,
2006, or at any adjournment thereof, with all the powers which the undersigned
would possess if personally present, as designated on the reverse side.
THE UNDERSIGNED HEREBY INSTRUCTS THE SAID PROXIES (I) TO VOTE IN ACCORDANCE WITH
THE INSTRUCTIONS INDICATED ON THE REVERSE SIDE, BUT IF NO INSTRUCTION IS GIVEN
ON THE REVERSE SIDE, TO VOTE "FOR" THE ELECTION OF ALL NOMINEES FOR DIRECTOR
LISTED ON THE REVERSE SIDE, AND (II) TO VOTE IN THEIR DISCRETION WITH RESPECT TO
SUCH OTHER MATTERS (INCLUDING MATTERS INCIDENT TO THE CONDUCT OF THE MEETING),
AS MAY PROPERLY COME BEFORE THE MEETING.
The undersigned hereby acknowledges receipt of the Notice of Meeting and Proxy
Statement dated April 7, 2006, relating to the Annual Meeting of Stockholders to
be held May 8, 2006. (Signature on the reverse side is required.)
(Continued and to be marked, signed and dated on reverse side.)
COMMENTS: