pre14a
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OMB
APPROVAL |
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OMB Number: |
3235-0059 |
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January 31, 2008
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant To
Section 14(a) of
The Securities Exchange Act of 1934 (Amendment
No. )
Filed by the
Registrant ý
Filed by a Party other than the
Registrant o
Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Definitive Additional Materials |
Glacier Bancorp, 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):
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Fee not required. |
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Fee computed on table
below per Exchange Act Rules 14a-6(i)(4) and 0-11. |
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(1) |
Title of each class of securities to which
transaction applies: |
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Aggregate number of securities to which transaction
applies: |
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Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11 (set forth
the amount on which the filing fee is calculated and state how it was determined): |
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(4) |
Proposed maximum aggregate value of transaction: |
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(5) |
Total fee paid: |
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SEC 1913 (04-05) |
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Persons who are to respond to the
collection of information contained in this form are not required to
respond unless the form displays a currently valid OMB control number. |
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Fee paid previously with preliminary materials. |
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Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
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(1) |
Amount Previously Paid: |
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(2) |
Form, Schedule or Registration Statement No.: |
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(3) |
Filing Party: |
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Date Filed: |
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GLACIER BANCORP, INC.
49 Commons Loop
Kalispell, Montana 59901
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 30, 2008
9:00 a.m. Mountain Time
To the Shareholders of Glacier Bancorp, Inc:
We cordially invite you to attend the 2008 Annual Shareholders Meeting of Glacier Bancorp,
Inc. at The Hilton Garden Inn, 1840 Highway 93 South, Kalispell, Montana. The meetings purpose is
to vote on the following proposals, together with any other business that may properly come before
the meeting:
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Election of Directors. The Board has nominated for election current directors
Michael J. Blodnick, Allen J. Fetscher and John W. Murdoch for three-year terms
expiring in 2011 and until their successors are elected and have qualified. |
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2. |
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Amendment of Articles of Incorporation. To approve an amendment to the
Companys Articles of Incorporation to eliminate the current staggered terms of the
board of directors and to instead provide for the annual election of all directors. |
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3. |
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Other Business. To act on such other matters as may properly come before the
meeting or any adjournments or postponements. |
If you were a shareholder of record on March 3, 2008, you may vote on the proposals presented
at the Annual Meeting in person or by proxy. We encourage you to promptly complete and return the
enclosed proxy card, in order to ensure that your shares will be represented and voted at the
meeting in accordance with your instructions. If you attend the meeting in person, you may
withdraw your proxy and vote your shares.
Further information regarding voting rights and the business to be transacted at the Annual
Meeting is included in the accompanying Proxy Statement. The directors, officers, and personnel
who serve you genuinely appreciate your continued interest as a shareholder in the affairs of the
Company and in its growth and development.
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March [28], 2008
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BY ORDER OF THE BOARD OF DIRECTORS
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LeeAnn Wardinsky, Secretary |
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YOUR VOTE IS IMPORTANT
Whether or not you plan to attend the Annual Meeting, please sign and date your Proxy Card and
return it in the enclosed postage prepaid envelope. You do not need to retain the proxy in order
to be admitted to the Annual Meeting. If you attend the Annual Meeting, you may vote either in
person or by proxy. You may revoke any proxy that you have given either in writing or in person
at any time prior to the proxys exercise.
TABLE OF CONTENTS
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i
GLACIER BANCORP, INC.
49 Commons Loop
Kalispell, Montana 59901
(406) 756-4200
PRELIMINARY PROXY STATEMENT
Important Notice Regarding the Availability of Proxy Materials for the 2008 Shareholder
Meeting:
A copy of this Proxy Statement and the Annual Report to Shareholders for the year ended
December 31, 2007 are available at www.glacierbancorp.com.
Meeting Information. This Proxy Statement and the accompanying Proxy are being sent to
shareholders on or about March 28, 2008, for use in connection with the Annual Meeting of
Shareholders of Glacier Bancorp, Inc. (the Company or Glacier) to be held on Wednesday, April
30, 2008. In this Proxy Statement, the term we and us refers to Glacier Bancorp, Inc.
Solicitation of Proxies. Our Board of Directors is soliciting shareholder proxies, and we
will pay the associated costs. Solicitation may be made by our directors and officers and by our
banking subsidiaries:
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Glacier Bank |
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Mountain West Bank |
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First Security Bank of Missoula |
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Western Security Bank |
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1st Bank |
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Big Sky Western Bank |
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Valley Bank of Helena |
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Glacier Bank of Whitefish |
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Citizens Community Bank |
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First Bank of Montana |
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First National Bank of Morgan |
We do not expect to engage an outside proxy solicitation firm to render proxy solicitation
services. However, if we do, we will pay a fee for such services. Solicitation may be made
through the mail, or by telephone, facsimile, or personal interview.
Record Date. If you were a shareholder on March 3, 2008, you are entitled to vote at the
Annual Meeting. There were approximately shares of common stock outstanding on the
Record Date.
Quorum. The quorum requirement for holding the Annual Meeting and transacting business is a
majority of the outstanding shares entitled to be voted. The shares may be present in person or
represented by proxy at the Annual Meeting. Both abstentions and broker non-votes are counted as
present for the purpose of determining the presence of a quorum.
Voting on Matters Presented
Proposal No. 1 -Election of Directors. The three nominees for election as directors
at the Annual Meeting with three-year terms to expire in 2011 who receive the highest number of
affirmative votes will be elected. Shareholders are not permitted to cumulate their votes for the
election of directors. Votes may be cast FOR or WITHHELD from each nominee. Votes that are
withheld and broker non-votes will have no effect on the outcome of the election.
Proposal No. 2 -Amendment of Companys Articles of Incorporation. The proposal to
amend the Companys Articles of Incorporation requires the affirmative vote FOR by a majority of
the outstanding
shares of the Companys common stock. You may vote FOR, AGAINST or ABSTAIN from approving the
amendment of the Articles of Incorporation. If you abstain, or if your shares are held in street
name and you
2
do not instruct your broker on how to vote your shares, your shares will not be voted
and the effect will be the same as a vote against the amendment. Shareholders of record are
entitled to one vote per share on this proposal.
Voting of Proxies. Shares represented by properly executed proxies that are received in time
and not revoked will be voted in accordance with the instructions indicated on the proxies. If no
instructions are indicated, the persons named in the proxy will vote the shares represented by the
proxy FOR the director nominees listed in this Proxy Statement and FOR the proposal to amend the
Companys Articles of Incorporation. Any proxy given by a shareholder may be revoked before its
exercise by:
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giving notice to us in writing; |
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delivering to us of a subsequently dated proxy; or |
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notifying us at the Annual Meeting before the shareholder vote is taken. |
Voting of Proxies by Shareholders of Record and by Beneficial Owners. A significant
percentage of Glacier shareholders hold their shares through a stockbroker, bank or other nominee
rather than directly in their own name. As summarized below, there are some differences between
shares held of record and those owned beneficially.
Shareholders of Record. If your shares are registered directly in your name with
Glaciers transfer agent, American Stock Transfer, you are considered, with respect to those
shares, the shareholder of record, and these proxy materials are being sent to you directly by
Glacier. As the shareholder of record, you have the right to grant your voting proxy directly to
Glacier or to vote in person at the Annual Meeting. We have enclosed a proxy card for you to use.
Beneficial Owner. If your shares are held in a stock brokerage account or by a bank
or other nominee, you are considered the beneficial owner of shares held in street name, and
these proxy materials are being forwarded to you by your broker or nominee who is considered, with
respect to those shares, the shareholder of record. As the beneficial owner, you have the right to
direct your broker on how to vote. Your broker or nominee has enclosed a voting instruction card
for you to use in directing your broker or nominee as to how to vote your shares. If you are a
beneficial owner of Glacier shares and do not provide the shareholder of record with voting
instructions, your beneficially owned shares may constitute broker non-votes.
Brokers cannot vote on behalf of beneficial owners on non-routine proposals. A broker
non-vote occurs when shares held by a broker for a beneficial owner are not voted with respect to
a particular proposal because (1) the proposal is not routine and the broker therefore lacks
discretionary authority to vote the shares, and (2) the beneficial owner does not submit voting
instructions to the broker.
The election of directors is considered a routine proposal, and your brokerage firm can vote
your shares in its discretion on this proposal. The proposal to amend the Companys Articles
of Incorporation is non-routine and your brokerage firm cannot vote your shares on this proposal
unless it has received voting instructions from you.
3
Voting in Person at the Annual Meeting
Shareholders of Record. Shares held directly in your name as the shareholder of
record may be voted in person at the Annual Meeting. If you choose to vote your shares in person
at the Annual Meeting, please bring the enclosed proxy card or proof of identification. Even if
you plan to attend the
Annual Meeting, we recommend that you vote your shares in advance as described above so that your
vote will be counted if you later decide not to attend the Annual Meeting.
Beneficial Owner. Shares held in street name may be voted in person by you only if
you bring an account statement or letter from the nominee indicating that you were the beneficial
owner of the shares on the record date.
BUSINESS OF THE MEETING
PROPOSAL NO. 1 ELECTION OF DIRECTORS
General
Our current Articles of Incorporation and Bylaws allow the Board to set the number of
directors on the Board within a range of seven to 17. The Articles also authorize the Board to
fill vacancies that occur on the Board. Glaciers Board currently consists of nine directors.
Directors are elected for terms of three years or until their successors are elected and
qualified. So long as the Company has nine or more directors, our Articles of Incorporation
currently provide for staggered terms, with approximately one-third of the directors elected each
year. Montana law and our Articles of Incorporation require that our classes of directors be of near-equal size as possible.
Accordingly, our Nominating/Corporate Governance Committee has recommended, and the Board has
nominated Michael J. Blodnick, Allen J. Fetscher and John W. Murdoch for election as directors for
three-year terms to expire in the year 2011. If any of the nominees should refuse or become unable
to serve, your proxy will be voted for the person the Board designates to replace that nominee. We
are not aware of any nominee who will be unable to or refuses to serve as a director.
Please Note: If the Companys shareholders approve Proposal No. 2 to amend the
Articles of Incorporation, the three directors named above, together with all other continuing
directors, will have their terms of service adjusted to expire in 2009 and be subject to annual
election commencing with the 2009 annual meeting.
Vote Required and Board Recommendation
The three nominees for election as directors at the Annual Meeting with three-year terms to
expire in 2011 who receive the highest number of affirmative votes will be elected.
The Board of Directors unanimously recommends a vote FOR each of the nominees to the Board.
4
INFORMATION WITH RESPECT TO NOMINEES
AND OTHER DIRECTORS
The following table sets forth certain information with respect to the director nominees and
the other continuing directors, including the number of shares beneficially held by each.
Beneficial ownership is a technical term broadly defined by the Securities and Exchange Commission
(SEC) to mean more than ownership in the usual sense. In general, beneficial ownership includes
any shares a director or executive officer can vote or transfer and stock options or other rights
that are exercisable currently or become exercisable within 60 days. Except as noted below, each
holder has sole voting and investment power for all shares shown as beneficially owned. All share
amounts have been adjusted for applicable stock splits and stock dividends.
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Amount and Nature of |
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Age as of |
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Beneficial Ownership of |
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January 15, |
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Director |
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Common Stock as of |
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2008 |
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January 15, 2008(1) |
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NOMINEES FOR DIRECTOR |
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Term Expiring in 2011 |
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Michael J. Blodnick |
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55 |
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Director, President
and CEO |
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1993 |
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2008 |
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424,712 |
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(.79 |
%)(2) |
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Allen J. Fetscher |
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62 |
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Director, Vice
Chairman of First
Security Bank of
Missoula |
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1996 |
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2008 |
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372,821 |
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(.694 |
%)(3) |
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John W. Murdoch |
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65 |
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Director, Director
of Big Sky Western
Bank |
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2005 |
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2008 |
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14,652 |
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(.027 |
%)(4) |
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CONTINUING DIRECTORS |
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Craig A. Langel |
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57 |
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Director |
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2005 |
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2009 |
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69,334 |
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(.129 |
%)(5) |
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L. Peter Larson |
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69 |
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Director |
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1985 |
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2009 |
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889,950 |
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(1.66 |
%)(6) |
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Everit A. Sliter |
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69 |
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Chairman of Glacier
and Glacier Bank |
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1973 |
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2009 |
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420,275 |
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(.782 |
%)(7) |
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James M. English |
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63 |
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Director, Director
of Mountain West
Bank |
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2004 |
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2010 |
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44,224 |
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(.082 |
%)(8) |
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Jon W. Hippler |
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63 |
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Director,
Director/President/C
EO of Mountain West
Bank |
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2000 |
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2010 |
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38,954 |
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(.072 |
%)(9) |
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Dr. Douglas J. McBride |
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55 |
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Director, Director
of Western Security
Bank |
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2006 |
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2010 |
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9,567 |
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(.018 |
%)(10) |
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(1) |
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The number and percentages shown are based on the number of shares of Glacier common stock
deemed beneficially held under applicable regulations, including options or other rights
exercisable on or before March 16, 2008 (60 days after January 15, 2008), and have been
adjusted for stock splits and stock dividends. |
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Includes 236,707 shares held jointly with Mr. Blodnicks wife; 92,647 shares owned by Mr.
Blodnicks wife; 4,122 shares for which Mr. Blodnick is custodian for his children; 27,459
shares held for Mr. Blodnicks account in the Companys Pension and Profit Sharing Plans;
26,802 shares held in an IRA account for the benefit of Mr. Blodnicks wife; and 36,975 shares
that could be acquired within 60 days by the exercise of stock options. |
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Includes 83,724 shares owned by Mr. Fetschers wife; 68,477 considered beneficially held as
Trustee for shares held in a trust for the benefit of Mr. Fetschers children; 118,566 held by
a family corporation, of which Mr. Fetscher is a principal; 1,803 shares held by Mr.
Fetschers SEPP IRA; and 17,357 shares that could be acquired within 60 days by the exercise
of stock options. |
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Includes 6,221 shares held in a family trust for which Mr. Murdoch has voting and dispositive
power and 8,431 shares that could be acquired within 60 days by the exercise of stock options. |
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Includes 11,076 shares that could be acquired within 60 days by the exercise of stock
options. |
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Includes 1,897 shares owned by Mr. Larsons wifes IRA; 834 shares held by Mr. Larsons IRA;
875,547 shares held in a living trust; and 11,672 shares that could be acquired within 60 days
by the exercise of stock options. |
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Includes 38,867 shares held jointly with Mr. Sliters wife; 113,578 shares owned by Mr.
Sliters wife; 44,817 shares owned by Mr. Sliters wifes IRA; 152,239 shares held by Mr.
Sliters IRA; 24,702 shares held by Mr. Sliters SEPP IRA; 6,416 shares held by Mr. Sliters
SRA; 3,444 shares held in a family partnership; and 13,488 shares that could be acquired
within 60 days by the exercise of stock options. |
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Includes 5,517 shares held in an IRA for the benefit of Mr. English; 22,707 shares owned
jointly with Mr. Englishs wife; and 16,000 shares that could be acquired by Mr. English
within 60 days by the exercise of options. |
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Includes 20,957 shares owned jointly with Mr. Hipplers wife, all of which have been pledged
as collateral toward a line of credit; and 17,997 shares that could be acquired within 60 days
by the exercise of options. |
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Includes 366 shares held as trustee for Dr. McBrides children and 4,375 shares that could be
acquired by Dr. McBride within 60 days by the exercise of options. |
Background of Nominees and Continuing Directors
Director Nominees
Michael J. Blodnick was appointed President and Chief Executive Officer of Glacier in
July 1998. Prior to that time, he served as the Executive Vice President and Secretary of the
Company since 1994 and 1993, respectively. Mr. Blodnick currently serves as a director of the
following Company subsidiaries: 1st Bank, Citizens Community Bank and First National
Bank of Morgan. Mr. Blodnick has been employed by the Company or Glacier Bank since 1978.
Allen J. Fetscher was appointed to the Board of Directors of Glacier in December 1996,
and he serves as the Chairman of the Companys Compensation Committee. Mr. Fetscher also serves as
the Vice Chairman of First Security Bank. Mr. Fetscher is the President of Fetschers, Inc., an
investment and real estate development company. He is also the Vice President of American Public
Land Exchange Co., Inc. and the owner of Associated Agency, a company involved in real estate.
John W. Murdoch was appointed a director of Glacier in September 2005. Mr. Murdoch
has worked in the ranch and home industry for the past 37 years and since 1994 has been an owner of
Murdochs Ranch & Home Supply, LLC, a ranch and home retail operation. Mr. Murdoch currently
serves as a director of the Companys subsidiary, Big Sky Western Bank of Bozeman, as well as of
the Montana State University College of Business, Montana State University Foundation and Bozeman
Deaconess Hospital. Mr. Murdoch is also President of Mid-States Distributing Co., Inc.
6
Continuing Directors
James M. English was appointed to the Glacier Board in February 2004. Mr. English is
an attorney in limited private practice as a sole practitioner of the English Law Firm in Hayden,
Idaho. Prior to forming his law firm, Mr. English served from 1996 2000 as the President and
Chief Operating Officer for Idaho Forest Industries, Inc., a lumber manufacturing company where Mr.
English was involved in the real estate development and retail sales of building products. Mr.
English earned his law degree and business degree in finance at the University of Idaho. Mr.
English has served as a director of Mountain West Bank since 1996. Mr. English is also a director
of Bennett Industries, Inc., a family-owned company that owns several timber-related entities,
including Bennett Forest Industries, Inc., a lumber manufacturer, and Rosebud Horse Bedding, LLC, a
manufacturer of horse bedding.
Jon W. Hippler has been the President and CEO of Mountain West Bank since its
formation in 1993. Mr. Hippler became a director of Glacier as a result of the Companys
acquisition of Mountain West Bank in February 2000.
Craig A. Langel was appointed a director of Glacier in December 2005. Mr. Langel has
served the accounting profession for 34 years and is a Certified Public Accountant Accredited in
Business Valuation and a Certified Valuation Analyst. He is president and shareholder of Langel &
Associates, P.C., a consulting and tax services firm. Through the auspices of Western CPE and the
University of Montana, Mr. Langel also teaches continuing education courses for Certified Public
Accountants, including annual tax updates, tax planning, valuation issues, and business advisory
services. In addition, Mr. Langel is the owner and CEO of CLC Restaurants, Inc., which owns and
operates Taco Bell and KFC restaurants in Montana, Idaho, and Washington, and part owner of Mustard
Seed Restaurants. Until his retirement in December 2005, Mr. Langel served for 21 years as a
director of Glaciers subsidiary, First Security Bank.
L. Peter Larson has been the CEO of American Timber Company, a small timber harvesting
company, since 1978. Mr. Larson has served as a director of the Company and/or Glacier Bank since
1985, and he is the Chairman of the Companys Nominating/Corporate Governance Committee.
Douglas J. McBride was appointed a director of Glacier in September 2006. Dr. McBride
has been an optometrist in Billings for 29 years. He is the current President of the Montana State
Board of Examiners for Optometry, of which he has been a member since 1993, and is also the
Chairman of the Advisory Board for TLC Laser Eye Center in Billings. Dr. McBride also serves as a
director of the Companys subsidiary, Western Security Bank.
Everit A. Sliter has served as a director of the Company and/or Glacier Bank since
1973, and was appointed Chairman of Glacier in December 2005. Mr. Sliter is the Chairman of the
Companys Audit Committee and is also the Chairman of Glacier Bank. Mr. Sliter was a partner of
Jordahl & Sliter, a certified public accounting firm, from 1965 to August 2003. Since August 2003,
Mr. Sliter has been an employee of Jordahl & Sliter.
7
CORPORATE GOVERNANCE
Corporate Governance Guidelines
The Board of Directors is committed to good business practices, transparency in financial
reporting and the highest level of corporate governance. Glacier operates within a comprehensive
plan of corporate governance for the purpose of defining responsibilities, setting high standards
of professional and personal conduct and assuring compliance with such responsibilities and
standards. The Company regularly monitors developments in the area of corporate governance. The
Board periodically reviews Glaciers governance policies and practices against those suggested by
various groups or authorities active in corporate governance and practices of other companies, as
well as the requirements of the Sarbanes Oxley Act of 2002 (Sarbanes Act), related SEC rules and
the listing standards of Nasdaq.
Code of Ethics
The Company adopted a Code of Ethics for Senior Financial Officers, which applies to its
principal executive officer, principal financial officer, principal accounting officer or
controller, and any persons performing similar functions.
You can access the Companys current Code of Ethics for Senior Financial Officers, its Audit,
Compensation and Nominating/Corporate Governance Committee charters and its Corporate Governance
Policy by visiting the Companys Website and clicking on the Corporate Governance link on the
Companys home page (www.glacierbancorp.com), or by writing to: Glacier Bancorp, Inc., c/o
the Corporate Secretary, 49 Commons Loop, Kalispell, Montana, 59901.
Director Independence
The Board has analyzed the independence of each director and nominee in accordance with the
Nasdaq rules and has determined that the following members of the Board meet the applicable laws
and listing standards regarding independence required by Nasdaq, and that each such director is
free of relationships that would interfere with the individual exercise of independent judgment.
In determining the independence of each director, the Board considered many factors, including any
lending with the directors, each of which were made on the same terms as comparable transactions
made with other persons. Such arrangements are discussed in detail in the section entitled
Transactions with Management.
Based on these standards, the Board determined that each of the following non-employee
directors is independent and has no relationship with the Company, except as a director and
shareholder:
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James M. English
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Douglas J. McBride |
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Allen J. Fetscher
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John W. Murdoch |
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Craig A. Langel
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Everit A. Sliter |
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L. Peter Larson |
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|
In addition, based on such standards, the Board determined that neither Michael J. Blodnick
nor Jon W. Hippler are independent because each serve as an executive officer of the Company or one
of its bank subsidiaries.
Stock Ownership Guidelines
The Board of Directors has approved stock ownership guidelines for its members, which are
intended to help closely align the financial interests of the directors with those of Glaciers
shareholders.
8
Within two years from when they are first appointed or elected to the Board, directors are required
to own shares of Glacier common stock with a market value of at least $100,000. All of the current
Glacier directors have exceeded this ownership requirement.
Shareholder Communications with the Board of Directors
The Company and the Board of Directors welcome communication from shareholders and other
interested parties. Communications may be made by writing to the Chairman of the Board, c/o the
Corporate Secretary, Glacier Bancorp, Inc., 49 Commons Loop, Kalispell, Montana 59901. A copy of
such written communication will also be sent to the Companys CEO. If the Chairman and the CEO
determine that such communications are relevant to and consistent with the Companys operations and
policies, such communications will be forwarded to the entire Board for review and consideration.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors met 14 times during the fiscal year. Each director attended at least
75% of the meetings of the Board and of the committees on which he served. Glacier encourages, but
does not require the directors to attend annual shareholder meetings. Last year, all of our
directors attended the annual shareholder meeting. The Board of Directors has established, among
others, an Audit Committee, a Compensation Committee and a Nominating/Corporate Governance
Committee.
The following table shows the membership of the various committees.
Committee Membership
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Name |
|
Audit |
|
Compensation |
|
Nominating |
James M. English |
|
|
þ |
|
|
|
þ |
|
|
|
þ |
|
Allen J. Fetscher |
|
|
o |
|
|
|
þ |
* |
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|
þ |
|
Craig A. Langel |
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|
þ |
|
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|
þ |
|
|
|
þ |
|
L. Peter Larson |
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|
þ |
|
|
|
þ |
|
|
|
þ |
* |
Douglas J. McBride |
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|
þ |
|
|
|
þ |
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|
þ |
|
John W. Murdoch |
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|
þ |
|
|
|
þ |
|
|
|
þ |
|
Everit A. Sliter |
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|
þ |
* |
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þ |
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|
|
þ |
|
9
Audit Committee. The Audit Committee is comprised of six directors, each of whom are
considered independent as defined by the Nasdaq listing standards. The Board has determined that
both Mr. Langel and Mr. Sliter meet the definition of audit committee financial expert as defined
by rules adopted by the SEC under the Sarbanes Act.
The Committee operates under a formal written charter adopted by the Board of Directors. As
part of its periodic review of audit committee-related matters, the Audit Committee has received
updates on the relevant requirements of the Sarbanes Act, the revised rules of the SEC and the
corporate governance listing standards of Nasdaq.
The Audit Committee is responsible for the oversight of the quality and integrity of Glaciers
financial statements, its compliance with legal and regulatory requirements, the qualifications and
independence of its independent auditors, the performance of its internal audit function and
independent auditors and other significant financial matters. In discharging its duties, the Audit
Committee is expected to, among other things:
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have the sole authority to appoint, retain, compensate, oversee, evaluate and
replace the independent auditors; |
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review and approve the engagement of Glaciers independent auditors to perform audit
and non-audit services and related fees; |
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meet independently with Glaciers internal auditing department, independent auditors
and senior management; |
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review the integrity of Glaciers financial reporting process; |
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review Glaciers financial reports and disclosures submitted to Bank regulatory
authorities; |
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maintain procedures for the receipt, retention and treatment of complaints regarding
financial matters; and |
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reviews and approves related person transactions. |
The Audit Committee held 14 meetings during the year.
Compensation Committee. The Compensation Committee is comprised of seven directors,
each of whom are considered independent as defined by the Nasdaq listing standards. The
Compensation Committee reviews the performance of the Companys Chief Executive Officer and other
key employees and determines, approves and reports to the Board on the elements of their
compensation and long-term equity based incentives. In determining the CEOs compensation, the
Committee evaluated several performance factors, including the Companys financial results, levels
of compensation of the Companys peers and the report of our compensation consultants,
Watson-Wyatt. In 2005, the Committee independently retained Watson Wyatt to assist the Committee
in its deliberations regarding executive compensation. The mandate of the consultant was to serve
the Company and work for the Committee in its review of executive compensation practices, including
designing our long-term incentive program. Although the Committee has not subsequently retained
Watson Wyatt, it continues to consider the suggestions made, and has incorporated those suggestions
into its compensation analysis in subsequent years. A complete description of the executive
compensation process is described in the Compensation Discussion and Analysis.
10
In addition, the Compensation Committee:
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recommends, if appropriate, new employee benefit plans to the Board of Directors; |
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reviews all employee benefit plans; |
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|
makes determinations in connection with compensation matters as may be necessary or
advisable; and |
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recommends, if appropriate, revisions to the compensation and benefit arrangements
for directors. |
The Compensation Committee operates under a formal written charter. The Compensation
Committee met two times during the year for the purposes of reviewing salary and incentive
compensation for the Chief Executive Officer and certain other executive officers, and reviewing
and recommending to the full Board the grant of stock awards for executive officers.
Nominating/Corporate Governance Committee. The Nominating/Corporate Governance
Committee (Nominating Committee) is comprised of seven directors, each of whom are considered
independent as defined by the Nasdaq listing standards. The Committee is responsible for
nominating a slate of directors for election at Glaciers annual meeting and appointing directors
to fill vacancies as they occur. It is also responsible for (i) considering management succession
plans, the appropriate Board size and committee structure and appointments; and (ii) developing and
reviewing corporate governance principles applicable to Glacier and its subsidiaries. The
Committee operates under a formal written charter approved by the Board of Directors. The
Nominating Committee met 10 times during 2007.
The Nominating Committee will consider nominees recommended by shareholders, provided that the
recommendations are made in accordance with the procedures described in this Proxy Statement under
Shareholder Proposals and Director Nominations. The Committee evaluates all candidates,
including shareholder-proposed candidates, using generally the same methods and criteria, although
those methods and criteria are not standardized and may vary from time to time. The Nominating
Committee is authorized to establish guidelines for the qualification, evaluation and selection of
new directors to serve on the Board. We do not anticipate that the Committee will adopt specific
minimum qualifications for Committee-recommended nominees, but that the Committee will instead
evaluate each nominee on a case-by-case basis, including assessment of each nominees business
experience, involvement in the communities served by the Company, and special skills. The
Nominating Committee will also evaluate whether the nominees skills are complimentary to existing
Board members skills, and the Boards need for operational, management, financial, technological
or other expertise, as well as geographical representation of Glaciers market areas.
11
Report of Audit Committee
The Audit Committee of the Board of Directors makes the following report, which
notwithstanding anything to the contrary set forth in any of our filings under the Securities Act
of 1933 or the Securities Exchange Act of 1934, will not be incorporated by reference into any such
filings and will not otherwise be deemed to be proxy soliciting materials or to be filed under such
Acts.
The Audit Committee consists of the directors listed below. The Board of Directors has
determined that (i) the current membership of the Audit Committee meets the independence
requirements as defined under the Nasdaq listing standards; and (ii) Everit A. Sliter and Craig A.
Langel each meet the audit committee financial expert qualifications, as required by the Sarbanes
Act and the Nasdaq listing standards.
Management has the primary responsibility for the financial statements and the reporting
process, including the systems of internal controls. The Audit Committee is responsible for
overseeing Glaciers financial reporting processes on behalf of the Board of Directors.
The Audit Committee has met and held discussions with management and the Companys independent
auditors. Management represented to the Committee that the Companys consolidated financial
statements were prepared in accordance with accounting principles generally accepted in the United
States of America, and the Committee has reviewed and discussed the audited consolidated financial
statements with management and the independent auditors. The Committee discussed with the
independent auditors matters required to be discussed by Statement on Auditing Standards No. 61
(Communication with Audit Committees).
Our independent auditors also provided to the Committee the written disclosures required by
Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees), and
the Committee discussed with the independent auditors that firms independence.
Based on the Committees review of the audited consolidated financial statements and the
various discussions with management and the independent auditors noted above, the Committee
recommended that the Board of Directors include the audited consolidated financial statements in
the Companys Annual Report on Form 10-K for the year ended December 31, 2007 filed with the SEC.
Audit Committee Members
Everit
A. Sliter (Chairperson) w James M. English
Craig A. Langel w L. Peter Larson w Douglas J. McBride w John W. Murdoch
COMPENSATION OF DIRECTORS
Directors receive compensation in the form of cash and, as applicable, awards in the form of
restricted stock or stock options. The Company does not pay directors who are also employees of
the Company additional compensation for their service as directors.
The following table shows compensation paid or accrued for the last fiscal year to Glaciers
non-employee directors. Neither Mr. Blodnick nor Mr. Hippler are included in the table as they are
employees of the Company or a subsidiary, and thus, receive no compensation for their services as a
director. The footnotes to the table describe the details of each form of compensation paid to
directors.
12
2007 Director Compensation Table
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Change in |
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Pension |
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Value and |
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Nonqualified |
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Fees Earned or |
|
Option |
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Deferred |
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Paid in Cash |
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Awards |
|
Compensation |
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Total |
Name |
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($) |
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($) |
|
Earnings |
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($) |
(a) |
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(b)(1) |
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(c)(2) |
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(d)(3) |
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(e) |
James M. English |
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$ |
39,050 |
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$ |
12,650 |
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$ |
5,561 |
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$ |
57,261 |
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Allen J. Fetscher |
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44,075 |
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12,650 |
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56,725 |
|
Craig A. Langel |
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24,000 |
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12,650 |
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36,650 |
|
L. Peter Larson |
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27,309 |
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12,650 |
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47,913 |
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87,872 |
|
Douglas J. McBride |
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36,300 |
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12,650 |
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4,236 |
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53,186 |
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John W. Murdoch |
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31,800 |
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12,650 |
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3,251 |
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47,701 |
|
Everit A. Sliter |
|
|
57,009 |
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12,650 |
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21,524 |
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91,183 |
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(1) |
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Directors are paid an annual retainer of $24,000 and receive additional
compensation for services performed as committee members. Messrs. English,
Fetscher, McBride, Murdoch and Sliter also receive compensation as directors of
Glaciers subsidiary banks. Amount includes Board and committee fees earned or
deferred in 2007. |
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(2) |
|
Reflects the dollar amount recognized for financial statement reporting
purposes for the fiscal year ended December 31, 2007 in accordance with FAS 123(R),
and include amounts awarded in 2007. Assumptions used to calculate this amount are
included in the footnotes to Glaciers audited financial statements for the fiscal
year ended 2007, included in the Companys accompanying Annual Report. The options
expire five years from the date of grant and vest six months from the date of grant. |
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At fiscal year end, the non-employee directors had in the aggregate outstanding stock
option awards to purchase shares of the Company as follows: Mr. English 18,579
shares; Mr. Fetscher 17,357 shares; Mr. Langel 11,076 shares; Mr. Larson 14,407
shares; Dr. McBride 4,375 shares; Mr. Murdoch 8,431 shares; and Mr. Sliter 17,357
shares. |
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(3) |
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Above market earnings on deferred compensation are credited at one-half of the
Companys current year return-on-equity, or seven percent rate in 2007. |
Cash Compensation
Non-employee directors of the Company are paid an annual retainer of $24,000 as compensation
for their services as director. Chairs of the Audit, Compensation and Nominating/Corporate
Governance Committee received an additional retainer of $1,200, and the Chairman of Board receives
an additional retainer of $5,400. Non-employee directors may elect to defer the receipt of meeting
and/or director fees in accordance with the terms of the Companys Deferred Compensation Plan, the
material terms of which are described under the section Executive Compensation Deferred
Compensation Plan.
13
Equity Compensation
Directors Stock Option Plan. The Board of Directors has adopted and the shareholders
approved the Directors Stock Option Plan (Director Plan) for outside directors. From time to
time, the Board and the shareholders have amended the Director Plan to increase the number of
shares available for issuance to outside directors. Under the Director Plan, a set number of
shares of common stock are reserved for issuance upon the exercise of nonqualified stock options
granted to non-employee directors of the Company and each of the Companys subsidiary banks.
From time to time, Glacier authorizes the grant of nonqualified options to its directors of
the Company and its subsidiary banks. These options allow the director to purchase shares of
common stock at a price equal to the fair market value (closing price) of the common stock on the
date of grant. Each option granted under the DSOP vests six months following the date of grant and
expires upon the earlier of five years following the date of grant or three years following the
date the optionee ceases to be a director, except in the event of death, in which case the period
is one year from the date of death.
The Director Plan has a term of 15 years, and will expire in March 2009 unless otherwise
renewed or extended. As of the Record Date, an aggregate of shares remained available
for future grant under the Director Plan (as adjusted for subsequent stock splits and stock
dividends). The Companys 2005 Stock Incentive Plan provides for the grant of equity awards to
directors. Accordingly, the Company has determined not to renew the Director Plan when it expires,
and will make subsequent grants to directors under the 2005 Stock Incentive Plan.
EXECUTIVE COMPENSATION
The following section describes the compensation that GBCI pays its Chief Executive Officer,
each person who served as Chief Financial Officer during 2007, and each other executive officer who
in 2007 earned total compensation exceeding $100,000 (the Named Executive Officers), consisting
of the following persons.
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Michael J. Blodnick, Chief Executive Officer |
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James H. Strosahl, Executive Vice President and Chief Financial Officer (retired
effective March 31, 2007) |
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Ron J. Copher, Senior Vice President and Chief Financial Officer (appointed
effective March 31, 2007) |
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Don J. Chery, Executive Vice President and Chief Administrative Officer (appointed
effective August 27, 2007) |
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Jon W. Hippler, President and CEO Mountain West Bank and a Company Director |
This section includes:
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the Compensation Discussion and Analysis (CD&A) of management on executive
compensation; |
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the Summary Compensation Table (on page___) and other tables detailing the
compensation of the Named Executive Officers; and |
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narrative disclosure about various compensation plans and arrangements and post
employment and termination benefits. |
Compensation Discussion and Analysis
14
The Board has established a Compensation Committee (the Committee) which is responsible for
planning and establishing, and monitoring overall compliance with, our compensation policies. The
Committee consists only of independent non-employee directors and operates under a written charter
approved by the Board.
Executive Compensation Philosophy
The quality of our employees, including our executive team, is critical to executing on our
community banking philosophy, emphasizing personalized service combined with the full resources of
a larger banking organization. To meet our primary goal of attracting, retaining and incentivizing
highly-qualified executives and employees within the context of our corporate culture, our
compensation programs are designed with the following principles in mind:
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We are committed to providing effective compensation and benefit programs that are
competitive for both within our industry and with other relevant organizations with
whom our banks compete for employees. |
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Our programs are designed to encourage and reward behaviors that ultimately
contribute to the achievement of organizational goals. |
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Pay programs and practices reinforce our commitment to providing a work environment
that promotes respect, teamwork, and individual growth opportunities. |
Consistent with this overall philosophy, we have designed our compensation programs to be
relatively straightforward and transparent to shareholders, while providing benefits attractive
enough to attract, retain and motivate highly qualified employees. The principal components of our
compensation package for executives are:
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Base salary |
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Annual incentive bonus |
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Long-term incentives equity grants |
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Retirement, termination and change of control benefits |
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Other general employee benefits |
The Committee designs our overall compensation program, and makes decisions regarding
individual executive compensation, in the content of a total compensation policy that takes into
account the overall package of compensation benefits provided to each executive. Except as
described below, we have not adopted any specific policies or guidelines for allocating
compensation between short-term and long-term incentives or between cash and non-cash compensation.
However, our philosophy is to tie a greater percentage of an executives compensation to the
achievement of Company financial and performance goals. Accordingly, base salaries are set at
competitive levels, with an opportunity for each executive to be well-rewarded through the annual
incentive bonus and stock option grants if the Company meets its performance objectives.
Process for Determining Compensation
The Committee typically meets at least annually to perform a strategic review of our executive
officers overall compensation packages, including determination of awards for the past fiscal year
based on satisfaction of previously established performance objectives, and adjustment of base
salaries,
15
establishment of target bonuses and performance objectives and granting of stock options for
the current fiscal year. Among other things, the Committee evaluates total executive compensation
and the role of various elements of compensation within that total.
Our Chief Executive Officer performs an annual performance review of other executive officers,
and provides a recommendation to the Committee regarding base salary and bonus targets for each
other executive officer, which the Committee has discretion to approve or modify. The Committee
then submits a recommendation regarding compensation for all executive officers to the Board for
approval. The Committee meets separately on an annual basis with our Chief Executive Officer to
determine his compensation.
In 2005, the Committee retained Watson-Wyatt, a multi-national employee benefits consulting
firm, to have them help design a new long-term incentive program and to review compensation levels
throughout the Company. We did not re-engage Watson-Wyatt for 2007, but the Committee considered
the recommendations made by Watson-Wyatt in 2005 in determining the compensation packages for
executives in 2007. In addition, the Committee also compares executive compensation levels against
a peer group of publicly-traded financial companies (the Compensation Peer Group). The
Compensation Peer Group is periodically updated by the Committee and consists of companies which
the Committee believes are comparable in size to the Company and with whom we may compete against
in limited geographic situations. The Compensation Peer Group for 2007 is identified below. The
Committee believes that we compete with all of the Compensation Peer Group for the recruiting and
retention of executives. Although the Committee does not conduct formal benchmarking of
executive compensation versus executive compensation of the Compensation Peer Group, it does
consider comparative compensation levels in assessing overall compensation.
Discussion of Executive Compensation Components
Base Salary
We provide executives and other employees with a base salary to compensate them for services
rendered during the year. Base salary ranges for executives are determined for each position based
on market data. Base salary is designed so that the salary opportunities for a given position will
be between 75% and 125% of the midpoint of the established range, depending upon, among other
things, the executives experience and the relative market demand for the skill set needed to
fulfill responsibilities of the position. In its review of base salaries for executives, the
Committee considers:
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Internal review of salary range based on available market data |
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Market data provided by consultants, when necessary |
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Internal review relative to others within the Company |
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Individual performance |
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The experience and qualifications of each individual |
Salary levels are reviewed annually as part of the Executive Performance Review. Promotion
and other changes in job responsibility are reviewed at the time of change or promotion.
Annual Incentive Bonus
Performance-based bonuses comprise a significant component of the overall compensation package
for each executive officer. The annual bonus of each executive officer, other than the Chief
16
Executive Officer and Chief Financial Officer, is contingent upon satisfaction of both
quantifiable and nonquantifiable performance measures established by the Committee, with the
nonquantifiable component typically limited to no more than 10% of the overall bonus. The
quantifiable measures are established at the beginning of each fiscal year and can be monitored by
us and the executive throughout the year. These performance measures are tracked and evaluated as
follows:
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For each quantifiable performance measure selected, three levels of goals are
defined to determine the amount of incentive that will be paid. |
|
- |
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Acceptable - At or below this level of performance, no incentive values are payable. |
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- |
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Expected - At this level of performance, 100% of target incentive values are payable. |
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- |
|
Outstanding - At this level of performance, 200% of target incentive
values are payable. |
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For each non-quantifiable performance measures, discretionary judgment is applied
across a spectrum ranging from minimally acceptable to clearly outstanding. |
The types of
performance measures, the target performance measure levels and the weighting of
each performance measure is predetermined at the beginning of each fiscal year with weights
typically ranging from 10% to 30%. Performance measures include Earnings Growth, Deposit Growth,
Asset Quality, Loan Growth, Holding Company Performance, and
others as needed, and are based on the performance of the bank at which the executive serves, with
respect to executives who serve at subsidiary banks.
Chief Executive Officer. In setting compensation for the Chief Executive Officer the
Committee relied heavily on the results of several performance factors. As demonstrated by the
Watson-Wyatt report, the Chief Executive Officers base salary is significantly below the
compensation paid to executives in the Compensation Peer Group. Consistent with our
performance-based philosophy, incentive compensation is a significant component in determining
overall his total compensation. While other executive bonuses are based on formulas determined by
the Committee, the bonus for the Chief Executive Officer is a separate process tied to subjective
as well as objective factors.
To determine the compensation package for our Chief Executive Officer, the Committee
considered our financial performance as compared to our Compensation Peer Group, as well as his
achievement of individual objectives and accomplishments. In addition, the Committee considered
other measures such as:
|
Ø |
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credit quality of the subsidiary banks, which remains strong; |
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Ø |
|
effective communication of our overall goals and objectives to employees; |
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Ø |
|
continued growth of the Company through the successful acquisition in 2007 of North
Side State Bank and the successful integration of the operations of North Side Bank and
of First National Bank of Morgan and Citizens Development Corporation, both acquired in
2006; and |
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|
Ø |
|
continuation of good shareholder relations. |
Although the Committee does not, in determining the compensation package for our Chief
Executive Officer, rely upon the multiple of that compensation package compared to those of the
other
17
Named Executive Officers, the Committee did note that the multiple of his total compensation
to the average total compensation of such other executive officers, excluding Mr. Strosahl, is
1.73.
Chief Financial Officer. Our Chief Executive Officer typically makes a recommendation
to the Committee with respect to the base salary and bonus for our Chief Financial Officer. This
recommendation is based on a variety of objective and subjective factors, including the same
Company performance factors listed above for other Named Executive Officers as well as individual
performance.
Long-term Incentives Equity Grants
The compensation package of each executive includes a long-term incentive component in the
form of annual equity grants. We believe stock ownership more closely aligns executive and Company
long-term goals, and in particular provides an incentive for executives to help build shareholder
value. We also believe this program provides a retentive effect by enabling executives to share in
the benefits of stock price appreciation.
In 2005, the Board adopted, and our shareholders approved, a Stock Incentive Plan. Each year,
the Board establishes target levels of shares for executive officers, other management positions,
and employees generally. Following each year, we award stock options at levels that are either
below, at or above the target levels, which levels are based on the Companys achievement of
predetermined goals based on three-year average return on average equity, which we believe is a
very important criterion in measuring our success and the performance of our executives.
Retirement Benefits
As part of our total compensation policy we offer executives the opportunity to participate
in both a tax-deferred compensation plan and a supplemental executive retirement plan (SERP). The
deferred compensation plan allows executives to defer a portion of their salary and bonus and
thereby defer tax payable on that income. Members of the Board are also entitled to participate in
the plan. The SERP is intended to supplement payments due to participants upon retirement under
our other qualified plans. Participation in these plans is elective.
Termination and Change of Control Benefits
As an additional part of our total compensation policy we have entered into employment
contracts with certain executive officers that allow for continuation of current base salary upon
termination without cause, or upon termination following a change in control of the Company. These
agreements provide for payments ranging from one times annual base salary to 2.99 times annual base
salary. These arrangements are intended to retain our executives who could have other job
alternatives that may appear to them to be less risky absent these arrangements, particularly given
the significant level of acquisition activity in the banking sector.
All of our change in control arrangements are double trigger, meaning that benefits are not
awarded upon a change of control unless the executives employment is terminated within a specified
period of time following the transaction. We believe this structure strikes a balance between the
incentives and the executive retention effects described above, without providing these benefits to
executives who continue to enjoy employment with an acquiring company in the event of a change of
control transaction.
18
The terms of these plans are described under the heading Post Employment and Termination
Benefits beginning on page ___. That section also contains tables showing the amounts that the
executive officers would receive if their employment was terminated in connection with a change in
control.
Other General Employee Benefits
Executive officers are eligible to participate in all employee benefit plans that are
available to eligible employees generally, including health insurance, life and disability
insurance, 401(k) matching contributions, and profit sharing.
2007 Executive Compensation
This year, as we have in past years (except for 2005, when we retained Watson-Wyatt), we
compared our executive compensation levels against a Compensation Peer Group. The Compensation
Peer Group for 2007 consisted of the following companies:
|
|
|
|
|
|
|
Western Alliance Bancorporation
|
|
Westamerica Bancorporation |
|
|
|
|
|
|
|
Corus Bankshares, Inc.
|
|
PrivateBancorp, Inc. |
|
|
|
|
|
|
|
1st Source Corporation
|
|
Umpqua Holdings Corporation |
|
|
|
|
|
|
|
CVB Financial Corp.
|
|
National Penn Bancshares, Inc. |
|
|
|
|
|
|
|
Capital Bancorp Ltd.
|
|
Sandy Spring Bancorp, Inc. |
|
|
|
|
|
|
|
Sterling Financial Corporation
|
|
Frontier Financial Corporation |
|
|
|
|
|
|
|
Community Bank Systems, Inc.
|
|
Banner Corporation |
|
|
|
|
|
|
|
Sterling Bancshares, Inc.
|
|
Integra Bank Corporation |
|
|
|
|
|
|
|
WesBanco, Inc.
|
|
Heartland Financial USA, Inc. |
|
|
|
|
|
|
|
Oriental Financial Group, Inc.
|
|
Chemical Financial Corporation |
2007 Base Salary
We increased the 2007 base salaries of Messrs. Blodnick and Hippler by 5.5% and 4.4%,
respectively. Based on its analysis of the performance factors described above, the Committee
recommended an increase in Mr. Blodnicks base salary in excess of the amount by which his salary
was actually increased, as Mr. Blodnick declined to accept the full recommended increase. Mr.
Blodnicks base salary remained at approximately 67% of the level of the average base salary for
chief executive officers among the Compensation Peer Group.
Mr. Hipplers base salary for 2007 was determined by, and paid by, Mountain West Bank, of
which Mr. Hippler has served as President and CEO since its formation in 1993.
Mr. Cherys base salary for 2007 was $171,000. Prior to his appointment, effective August 27,
2007, to the position of Executive Vice President and Chief Administrative Officer of the Company,
Mr. Chery served as President of Big Sky Western Bank, and his salary for 2007 prior to August 27,
2007 was paid pursuant to an employment agreement with that institution, which determined the
annual base salary. Mr. Cherys salary from August 27, 2007 to the end of 2007 was negotiated in
connection with his promotion.
19
Mr. Cophers base salary for 2007 was $190,000. Mr. Copher was retained to be the successor
to Mr. James Strosahl, our former Chief Financial Officer, upon Mr. Strosahls retirement. Prior
to Mr. Strosahls retirement and Mr. Cophers assumption of the duties of Chief Financial Officer,
Mr. Copher served as the Companys Senior Vice President. Mr. Cophers base salary was negotiated
in connection with the commencement of his employment.
Mr. Strosahl retired as our Chief Financial Officer effective March 31, 2007. Accordingly,
Mr. Strosahls employment agreement, which governed his compensation for 2006, was not renewed.
Mr. Strosahl received base compensation of $241,239 (annualized) in 2007, prior to the date of his
retirement. Mr. Strosahls compensation was based on, among other things, his assistance in
transitioning the Chief Financial Officer role to Mr. Copher, and his responsibilities in
connection with the acquisition of North Side State Bank.
2007 Annual Incentive Bonuses
For 2007, we awarded a bonus to our Chief Executive Officer of $150,000, or approximately 48%
of his base salary. This bonus was based on the Committees determination that our Chief Executive
Officer had met all of the performance measures for 2007 with an outstanding level of performance.
Our financial results are evidenced by our performance relative to our Compensation Peer Group. In
this group, Glacier Bancorp, Inc. was third in Return on Average Assets, fourth in Return of
Average Equity and third in total return over the past three years. We maintained a strong level
of credit quality through 2007, and the percentage of loans which were past due is substantially
below our peer group. In addition, our Chief Executive Officer led the acquisition of a bank in
Wyoming during 2007, as well as the integration of the operations of two financial institutions
acquired in 2006. The Committee also considered our Chief Executives efforts in helping to
maintain strong shareholder relations. The Committee also recognized that the base salary of our
Chief Executive Officer is approximately 67% of the average base salary for chief executive
officers among our peer group. Based upon its evaluation of Mr. Blodnicks performance during
2007, and in light of his comparatively low base salary, the Committee recommended a bonus in
excess of $150,000, but Mr. Blodnick declined to accept a bonus in a higher amount.
Mr. Hippler received a bonus of $91,849, or 39.7% of his base salary. Mr. Hipplers bonus was
based on the performance of his bank relative to pre-established performance targets as set by the
Committee for subsidiary banks generally.
Messrs. Chery and Copher received bonuses of $54,818 and $60,500, respectively, or 32% of
their respective base salaries. Mr. Cherys bonus was negotiated as a part of his overall
compensation in connection with his promotion and was based, with respect to the period prior to
such promotion, on the performance of Big Sky Western Bank. Mr. Cophers bonus was negotiated in
connection with the commencement of his employment.
Long-term Incentives
The Committee established the following targets for option grants to our executive officers
during 2007:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Objective (3 Yr. ROE) |
|
|
14% |
|
16% |
|
18% |
Position |
|
Threshold |
|
Target |
|
Maximum |
CEO |
|
|
11,250 |
|
|
|
15,000 |
|
|
|
18,750 |
|
CFO and CAO |
|
|
6,000 |
|
|
|
8,000 |
|
|
|
10,000 |
|
President, Subsidiary Banks >$500 million |
|
|
6,000 |
|
|
|
8,000 |
|
|
|
10,000 |
|
20
Our long-term incentive (stock option) grants to executive officers are based on the Companys
achievement of specified levels of three-year average return on equity (ROE) as set by the
Committee each year. The three-year average ROE applicable to the grants made in 2007 exceeded the
target level of 16%. As a result, Mr. Blodnick was granted options for 15,000 shares, and Mr.
Hippler was granted options for 8,000 shares.
Because Mr. Chery was not employed by the Company at the beginning of 2007, and Mr. Copher was
not appointed as Chief Financial Officer until March 31, 2007, the options granted to them as
long-term incentives (5,000 shares and 8,000 shares, respectively) in 2007 were not subject to the
criteria described above, but rather were negotiated in connection with the commencement of
employment. Messrs. Chery and Copher will participate in the long-term incentive program for
subsequent years on the same terms as all other executive officers.
As noted, the long-term incentive grants made in 2007 and described above were based on the
average ROE for the three years preceding the year in which the grants were made (the years 2004,
2005 and 2006). The three year average ROE applicable to performance during 2007 (the years 2005,
2006 and 2007) exceeded the threshold level (14%), but did not reach the target level (16%).
Accordingly, in January 2008, our executive officers received long-term incentive grants at the
levels indicated under the 14% Threshold in the table above.
During 2007, we granted stock options to purchase an aggregate of 773,720 shares overall, with
51,000 of these shares (or 6.6%) granted to Named Executive Officers.
Tax Considerations
Under federal income tax law, a public company may not deduct non-performance based
compensation in excess of $1 million paid to its chief executive officer or any of its other four
most highest-paid executive officers. No executive officer of the Company received non-performance
based compensation in excess of this limit in fiscal 2007. The compensation committee currently
intends to continue to manage the Companys executive compensation program in a manner that will
maximize federal income tax deductions. However, the compensation committee may from time to time
exercise its discretion to award compensation that may not be deductible under Section 162(m) of
the Internal Revenue Code when in its judgment such award would be in the best interests of the
Company.
In addition, the change in control provisions described in the section entitled Executive
Compensation are designed to reduce the amounts payable that otherwise would be subject to an
excise tax applicable to payments known as excess golden parachute payments as defined under
Section 280G of the Internal Revenue Code.
Report of Compensation Committee
The Compensation Committee of the Board of Directors makes the following report, which
notwithstanding anything to the contrary set forth in any of the Companys filings under the
Securities Act of 1933 or the Securities Exchange Act of 1934, will not be incorporated by
reference into any such filings and will not otherwise be deemed to be proxy soliciting materials
or to be filed under such Acts.
The Compensation Committee of the Company has reviewed and discussed the Compensation
Discussion and Analysis (CD&A) required by Item 402(b) of Regulation S-K with management, and
21
based on that review and discussions, the Compensation Committee recommended to the Board that
the CD&A be included as part of this Proxy Statement and 2007 Annual 10-K Report.
Compensation Committee Members
Allen
J. Fetscher (Chairperson) w James
M. English w Craig A. Langel
L. Peter Larson w Douglas
J. McBride w John
W. Murdoch w Everit A. Sliter
Compensation Tables
The following table shows compensation paid or accrued for the last fiscal year to Glaciers
Chief Executive Officer, Chief Financial Officers and each of the two Named Executives earning in
excess of $100,000.
22
Summary Compensation Table
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
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|
|
|
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|
|
Change in |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension Value |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
and |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonqualified |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option |
|
Compensation |
|
All Other |
|
|
Name and Principal |
|
|
|
|
|
Salary |
|
Bonus |
|
Awards |
|
Earnings |
|
Compensation |
|
Total |
Position |
|
Year |
|
($) |
|
($) |
|
($) |
|
($) |
|
($) |
|
($) |
(a) |
|
(b) |
|
(c) |
|
(d)(1) |
|
(e)(2) |
|
(f)(3) |
|
(g) (4) (5) |
|
(h) |
Michael J. Blodnick |
|
|
2007 |
|
|
$ |
314,423 |
|
|
$ |
150,000 |
|
|
$ |
83,885 |
|
|
$ |
74,952 |
|
|
$ |
29,530 |
|
|
$ |
652,790 |
|
President and CEO |
|
|
2006 |
|
|
|
298,438 |
|
|
|
200,000 |
|
|
|
51,546 |
|
|
|
87,009 |
|
|
|
29,690 |
|
|
|
666,683 |
|
James H. Strosahl |
|
|
2007 |
* |
|
$ |
80,413 |
|
|
$ |
|
|
|
$ |
83,885 |
|
|
$ |
17,598 |
|
|
$ |
30,026 |
|
|
$ |
211,922 |
|
Executive Vice |
|
|
2006 |
|
|
|
235,365 |
|
|
|
150,000 |
|
|
|
51,546 |
|
|
|
40,302 |
|
|
|
30,980 |
|
|
|
508,193 |
|
President, CFO,
and Secretary |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ron J. Copher, |
|
|
2007 |
** |
|
$ |
190,000 |
|
|
$ |
60,500 |
|
|
$ |
44,853 |
|
|
$ |
|
|
|
$ |
47,700 |
|
|
$ |
343,053 |
|
Senior Vice
President
and CFO |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Don J. Chery, |
|
|
2007 |
*** |
|
$ |
171,073 |
|
|
$ |
54,818 |
|
|
$ |
28,343 |
|
|
$ |
|
|
|
$ |
24,285 |
|
|
$ |
278,519 |
|
Executive Vice
President and Chief
Administrative
Officer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jon W. Hippler, |
|
|
2007 |
|
|
$ |
230,834 |
|
|
$ |
91,849 |
|
|
$ |
45,006 |
|
|
$ |
11,617 |
|
|
$ |
35,258 |
|
|
$ |
414,564 |
|
President, Mountain |
|
|
2006 |
|
|
|
221,508 |
|
|
|
107,000 |
|
|
|
30,788 |
|
|
|
21,440 |
|
|
|
35,744 |
|
|
|
416,480 |
|
West Bank |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* |
|
Retired effective March 31, 2007. |
|
** |
|
Senior Vice President until March 31, 2007; Senior Vice President and Chief Financial Officer
effective March 31, 2007. |
|
*** |
|
President, Big Sky Western Bank, until August 27, 2007; Executive Vice President and Chief
Administrative Officer of the Company, effective August 27, 2007. |
|
(1) |
|
Includes $75,000 and $22,962 deferred by Messrs. Blodnick and Hippler, respectively, pursuant
to the Companys Deferred Compensation Plan, the material terms of which are described below
under Deferred Compensation Plan. |
|
(2) |
|
Reflects the dollar amount recognized for financial statement reporting purposes for the
fiscal year ended December 31,2007 in accordance with FAS 123(R), and include amounts awarded
in and prior to 2007 (as adjusted for stock splits and stock dividends). Assumptions used to
calculate this amount are included in the footnotes to Glaciers audited financial statements
for the fiscal year ended 2006, included in the Companys accompanying Annual Report. The
options expire five years from the date of grant and vest two years from the date of grant. |
|
(3) |
|
Represents amounts contributed by Glacier to the Named Executives individual account under
Glaciers Supplemental Executive Retirement Plan (SERP), the material terms of which are
described below under Post Employment and Termination Benefits Supplemental Executive
Retirement Plan and above-market earnings on non-qualified deferred compensation during 2007.
Earnings are credited at one-half of the Company current year return-on-equity, or eight
percent in 2007. |
|
(4) |
|
Amount shown for Mr. Blodnick includes: $6,162 allocated or paid by Glacier pursuant to the
Companys 401(k) matching program; $15,750 allocated or paid by Glacier pursuant to Glaciers
Profit Sharing Plan; $1,240 in life insurance premiums paid by Glacier.
Amount shown for Mr. Strosahl includes: $2,412 allocated or paid by Glacier pursuant to the
Companys 401(k) matching program; $2,412 allocated or paid by Glacier pursuant to Glaciers
Profit Sharing Plan; $1,026 in life insurance premiums paid by Glacier.
Amount shown for Mr. Copher includes: $5,446 allocated or paid by Glacier pursuant to the
Companys 401(k) matching program; $13,366 allocated or paid by Glacier pursuant to Glaciers
Profit Sharing Plan; $504 in life insurance premiums paid by Glacier.
Amount shown for Mr. Chery includes: $6,683 allocated or paid by Glacier pursuant to the
Companys 401(k) matching program; $15,750 allocated or paid by Glacier pursuant to Glaciers
Profit Sharing Plan; $432 in life insurance premiums paid by Glacier.
Amount shown for Mr. Hippler includes: $3,016 allocated or paid by Glacier pursuant to the
Companys 401(k) matching program; $15,750 allocated or paid by Glacier pursuant to Glaciers
Profit Sharing Plan; $1,904 in life insurance premiums paid by Glacier. |
|
(5) |
|
Does not include amounts attributable to miscellaneous benefits or perquisites received by
the Named Executives, except Mr. Copher. The costs to the Company of providing such benefits
to any individual executive officer, except Mr. Copher, during the year ended December 31,
2007 did not exceed $10,000 in the aggregate. With respect to Mr. Copher, includes a real
estate relocation payment of $29,252, moving expenses and a housing allowance. |
23
2007 Grants of Plan-Based Awards
The following table provides information on the grant of equity and non-equity awards during
2007.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other Option Awards: |
|
|
|
|
|
|
|
|
|
|
Number Securities |
|
|
|
|
|
|
|
|
|
|
Under- |
|
Exercise or Base Price of |
|
Grant Date Fair Value of |
|
|
Grant |
|
lying Options |
|
Option Awards (/Sh) |
|
Stock and Option Awards |
Name |
|
Date |
|
(#) |
|
$ |
|
$ |
(a) |
|
(b) |
|
(c)(1)(2) |
|
(d)(1)(3) |
|
(e)(1)(3) |
Michael J. Blodnick |
|
|
1/31/2007 |
|
|
|
15,000 |
|
|
$ |
23.47 |
|
|
$ |
75,900 |
|
James H. Strosahl |
|
|
1/31/2007 |
|
|
|
15,000 |
|
|
$ |
23.47 |
|
|
|
75,900 |
|
Ron J. Copher |
|
|
1/31/2007 |
|
|
|
8,000 |
|
|
$ |
23.47 |
|
|
|
40,480 |
|
Don J. Chery |
|
|
1/31/2007 |
|
|
|
5,000 |
|
|
$ |
23.47 |
|
|
|
25,300 |
|
Jon W. Hippler |
|
|
1/31/2007 |
|
|
|
8,000 |
|
|
$ |
23.47 |
|
|
|
40,480 |
|
|
|
|
(1) |
|
Amounts have been adjusted to reflect applicable stock splits and stock
dividends. |
|
(2) |
|
Stock options vest on the second anniversary of the date of grant and must be
exercised within five years of the grant date, subject to certain conditions, as
discussed in the section Executive Compensation Employee Stock Plans. |
|
(3) |
|
The grant date fair value of the equity awards is computed in accordance with FAS
123(R). Information regarding the stock option awards can be found in the footnotes to
Glaciers financial statements, included in the accompanying Annual Report. |
2007 Option Exercises and Stock Vested
|
|
|
|
|
|
|
|
|
|
|
Option Awards |
|
|
Number of Shares Acquired |
|
|
|
|
on Exercise |
|
Value Realized on Exercise |
Name |
|
(#) |
|
($) |
(a) |
|
(b)(1) |
|
(c)(1) |
Michael J. Blodnick |
|
|
6,833 |
|
|
$ |
105,372 |
|
James H.
Strosahl(2) |
|
|
21,599 |
|
|
|
283,864 |
|
Ron J. Copher |
|
|
0 |
|
|
|
0 |
|
Don J. Chery |
|
|
6,833 |
|
|
|
105,372 |
|
Jon W. Hippler |
|
|
7,032 |
|
|
|
60,264 |
|
|
|
|
7,734 |
|
|
|
96,675 |
|
|
|
|
1,446 |
|
|
|
7,620 |
|
|
|
|
(1) |
|
The value realized represents the excess of the
fair market value of the shares at the time of exercise over the
exercise price of the options (the closing price of the options on
the date of grant). The amounts have been adjusted to reflect
applicable stock splits and stock dividends. |
|
|
|
(2) |
|
Includes 14,766 shares acquired upon exercise subsequent to
retirement on March 31, 2007, representing value realized on
exercise of $178,312.
|
24
2007 Outstanding Equity Awards at Fiscal Year-End
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards |
|
|
|
|
|
|
Number of Securities |
|
|
|
|
|
|
Number of Securities |
|
Underlying Unexercised |
|
Option Exercise |
|
|
|
|
Underlying Options |
|
Options |
|
Price |
|
Option |
Name |
|
(#) Exercisable |
|
(#) Unexercisable |
|
($) |
|
Expiration Date |
(a) |
|
(b)(1) |
|
(c)(1) |
|
(d)(1) |
|
(e) |
Michael J. Blodnick |
|
|
7,734 |
|
|
|
|
|
|
$ |
9.45 |
|
|
|
01/29/2008 |
|
|
|
|
7,032 |
|
|
|
|
|
|
|
13.37 |
|
|
|
01/28/2009 |
|
|
|
|
7,443 |
|
|
|
|
|
|
|
16.67 |
|
|
|
01/26/2010 |
|
|
|
|
|
|
|
|
22,500 |
(2) |
|
|
20.96 |
|
|
|
01/25/2011 |
|
|
|
|
|
|
|
|
15,000 |
(3) |
|
|
23.47 |
|
|
|
01/31/2012 |
|
James H. Strosahl |
|
|
7,443 |
|
|
|
|
|
|
|
16.67 |
|
|
|
03/31/2008 |
|
|
|
|
22,500 |
|
|
|
|
|
|
|
20.96 |
|
|
|
03/31/2008 |
|
|
|
|
15,000 |
|
|
|
|
|
|
|
23.47 |
|
|
|
03/31/2008 |
|
Ron J. Copher |
|
|
|
|
|
|
15,000 |
(4) |
|
|
24.40 |
|
|
|
12/18/2011 |
|
|
|
|
|
|
|
|
8,000 |
(3) |
|
|
23.47 |
|
|
|
01/31/2012 |
|
Don J. Chery |
|
|
7,734 |
|
|
|
|
|
|
|
9.45 |
|
|
|
01/29/2008 |
|
|
|
|
7,032 |
|
|
|
|
|
|
|
13.37 |
|
|
|
01/28/2009 |
|
|
|
|
7,443 |
|
|
|
|
|
|
|
16.67 |
|
|
|
01/26/2010 |
|
|
|
|
|
|
|
|
7,500 |
(2) |
|
|
20.96 |
|
|
|
01/25/2011 |
|
|
|
|
|
|
|
|
5,000 |
(3) |
|
|
23.47 |
|
|
|
01/31/2012 |
|
Jon W. Hippler |
|
|
5,997 |
|
|
|
|
|
|
|
16.67 |
|
|
|
01/26/2010 |
|
|
|
|
|
|
|
|
12,000 |
(2) |
|
|
20.96 |
|
|
|
01/25/2011 |
|
|
|
|
|
|
|
|
8,000 |
(3) |
|
|
23.47 |
|
|
|
01/31/2012 |
|
|
|
|
(1) |
|
As adjusted for subsequent stock splits and stock dividends. |
|
(2) |
|
Options became fully vested January 25, 2008. |
|
(3) |
|
Options become fully vested January 30, 2009. |
|
(4) |
|
Options become fully vested December 18, 2008. |
Employee Stock Plans
The Company has previously maintained an employee stock option plan, including the 1995
Employee Stock Option Plan (1995 Plan), which was approved by the Board of Directors and the
shareholders. The 1995 Plan provided for the grant of incentive and nonqualified stock options,
had a term of 10 years, and expired in February of 2005. Although no options may be issued under
the 1995 Plan, the plan has granted but unexercised options outstanding.
At the 2005 Annual Meeting, shareholders of Glacier approved the 2005 Stock Incentive Plan
(2005 Plan), the successor to the 1995 Plan. The 2005 Plan provides for awards of stock based
incentive compensation to eligible employees, consultants, and directors of the Company or its
affiliates. Shares of Glacier common stock are issuable under the 2005 Plan in the form of stock
options, share appreciation rights, restricted shares, restricted share units and unrestricted
shares, deferred share units, and performance awards.
The 2005 Plan is effective for ten years and limits the grant of shares to any one eligible
individual to a maximum of 562,500 shares during the term of the 2005 Plan. The aggregate number
of shares available for issuance under the 2005 Plan is 3,323,162 of which no more than 2,259,750
may be granted in a form other than stock options and stock appreciation rights. All share amounts
have been adjusted for applicable stock splits and stock dividends.
25
Post Employment and Termination Benefits
2007 Nonqualified Deferred Compensation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive |
|
Aggregate |
|
Aggregate |
|
|
Contribution in |
|
Earnings in Last |
|
Balance at Last |
|
|
Last FY |
|
FY |
|
FYE |
Name |
|
($) |
|
($) |
|
($) |
(a) |
|
(b)(1) |
|
(c)(2) |
|
(d) |
Michael J. Blodnick |
|
$ |
75,000 |
|
|
$ |
41,258 |
|
|
$ |
705,655 |
|
James H. Strosahl |
|
|
|
|
|
|
26,871 |
|
|
|
410,741 |
|
Ron J. Copher |
|
|
|
|
|
|
|
|
|
|
|
|
Don J. Chery |
|
|
|
|
|
|
|
|
|
|
|
|
Jon W. Hippler |
|
|
22,962 |
|
|
|
8,450 |
|
|
|
129,166 |
|
|
|
|
(1) |
|
Amounts deferred pursuant to the Deferred Compensation Plan,
which are reported as compensation to each of the Named Executives in
the Summary Compensation Table. The material terms of the Deferred
Compensation Plan are described below. |
|
(2) |
|
Earnings on amounts deferred under the Deferred Compensation
Plan are credited at one-half of the Companys current year
return-on-equity, or 7% in 2007. |
Deferred Compensation Plan. Since December 1995, Glacier has maintained a
non-qualified and non-funded deferred compensation plan (the Deferred Plan) for directors and key
employees. The Deferred Plan permits eligible directors and officers of the Company to defer
certain income that would otherwise be taxable as earned and paid in the ordinary course. The
Deferred Plan was subsequently amended principally in response to the recent enactment of Section
409A of Internal Revenue Code of 1986, and permit participants to elect cash-out distributions, and
to make new distribution elections on terms that conform with the restrictions set forth in Section
409A.
As amended and restated, the Plan permits a designated officer or key employee to annually
defer up to 50% of his or her salary, as well as up to 100% of any cash bonuses. A non-employee
director may elect to have any portion of his or her directors fees deferred into an account. The
restated Deferred Plan also provides that the post-2004 rate of return on deferred compensation
accounts will equal fifty percent (50%) of the Companys return-on-average-equity (whether positive
or negative) as of December 31 for such year. This change is expected to limit the Companys
future compensation expense while retaining the Deferred Plans performance-based nature.
Pension Benefits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Present Value of |
|
|
|
|
|
|
|
|
Number of Years |
|
Accumulated |
|
Payments During |
|
|
|
|
|
|
Credited Service |
|
Benefit |
|
Last Fiscal Year |
Name |
|
Plan Name |
|
(#) |
|
($) |
|
($) |
(a) |
|
(b)(1) |
|
(c)(2) |
|
(d)(3) |
|
(e) |
Michael J. Blodnick |
|
SERP |
|
|
N/A |
|
|
$ |
572,932 |
|
|
$ |
0 |
|
James H. Strosahl |
|
SERP |
|
|
N/A |
|
|
|
110,556 |
|
|
|
24,876 |
|
Ron J. Copher |
|
SERP |
|
|
N/A |
|
|
|
2,069 |
|
|
|
0 |
|
Don J. Chery |
|
SERP |
|
|
N/A |
|
|
|
61 |
|
|
|
0 |
|
Jon W. Hippler |
|
SERP |
|
|
N/A |
|
|
|
47,805 |
|
|
|
0 |
|
|
|
|
(1) |
|
The terms of the Supplement Executive Retirement Plan (SERP) are described below. |
26
|
|
|
(2) |
|
There are no minimum service requirements under the SERP. |
|
(3) |
|
Based on the amounts accrued through fiscal year 2007, in the event the executive
were to leave employment, each of the Named Executives would generally receive five
annual installments under the SERP, payable in the following amounts: Mr. Blodnick
$114,586; Mr. Copher $414; Mr. Chery $12;. Mr. Hippler $9,561. However, as noted below
participants may alternatively make cash out elections or other distribution elections. |
Supplemental Executive Retirement Plan. In December 1995, the Board adopted a
nonqualified and nonfunded Supplemental Executive Retirement Plan (the SERP) for senior executive
officers and entered into separate Supplemental Executive Retirement Agreements with the
executives. The SERP is intended to supplement payments due to participants upon retirement under
the Companys other qualified plans. In general, the SERP provides that Glacier will credit each
participating executives account on an annual basis, an amount equal to employer contributions
that would have otherwise been allocated to the executives account under the tax-qualified plans
were it not for limitations imposed by the Internal Revenue Service, or participation in the
Deferred Plan. Payments under the SERP will be made in five annual installments upon the executive
leaving employment, the first of which will be paid on the first day of the second month upon
retirement. In the event of a change in control, the amounts in the individual SERP accounts will
be deposited into a trust, and the Company will continue to be obligated to provide for the
benefits under the SERP. In the event the executive is terminated for Just Cause (as defined), no
benefits will be payable to the executive under the SERP and all obligations of the Company with
respect to the executives SERP cease.
In 2005, the SERP was amended to principally mirror those changes described above for the
Companys Deferred Plan, namely: permitting participants to make cash-out elections and new
distribution elections, and providing that, for years after 2004, the account balance for each
participant will be credited with a rate of return that is equal to fifty (50%) of the Companys
return-on-average equity.
Employment Arrangements
Below are summaries of certain agreements between executive officers listed in the
compensation table and the Company or its subsidiaries. These summaries are qualified in their
entirety by the individual agreements.
Michael J. Blodnick Employment Agreement. During calendar year 2007, Mr. Blodnicks
employment was governed by an employment agreement that became effective January 1, 2007. The
Agreement terminated December 31, 2007 and a new agreement was entered into effective January 1,
2008. Mr. Blodnicks agreement provides for an annual salary (currently $324,450), with subsequent
increases subject to the recommendation of the Compensation Committee and the Boards review of Mr.
Blodnicks compensation and performance. Incentive compensation is to be determined by the Board,
as recommended by the Compensation Committee, and any bonus will be payable not later than January
31 of the year following the year in which the bonus is earned. If Mr. Blodnicks employment is
terminated by the Company without cause (as defined) or by Mr. Blodnick for good reason (as
defined) during the term of the agreement, Mr. Blodnick will receive a payment having a present
value equal to the compensation and other benefits to which he would have been entitled for the
remainder of the term if his employment had not terminated. All such payments must be completed no
later than March 15 of the calendar year following the year in which employment was terminated.
Mr. Blodnick is prohibited from competing with the Company or its subsidiaries during the term of
the agreement and for a three-year period following his termination of employment.
If Mr. Blodnicks employment is terminated by the Company or its successor within three years
following a change of control (as defined), Mr. Blodnick will be entitled to receive an amount
equal to 2.99 times his then current annual salary, payable in 36 monthly installments, plus
continued employment
27
benefits for 2.99 years following termination. This amount (2.99 times annual salary plus
continuation of benefits) would also be payable if Mr. Blodnick terminates his employment within
three years of a change of control. If Mr. Blodnicks employment is terminated, other than for
cause, by the Company in certain circumstances following the announcement of a change in control
that subsequently occurs, Mr. Blodnick will be entitled to receive an amount equal to 2.99 times
his then current annual salary, payable in 36 installments commencing within 30 days after the
change in control. The agreement provides that the payments to be received by Mr. Blodnick will be
limited to less than the amount that would cause them to be an excess parachute payment within
the meaning of Section 280G of the Internal Revenue Code. In addition, the payments and benefits
to be received by Mr. Blodnick will be reduced by any compensation that he receives from the
Company or its successor following a change in control and/or after his termination of employment.
Ron J. Copher Employment Agreement. During 2007, Mr. Cophers employment was governed
by an employment agreement that became effective on December 22, 2006. A new agreement was entered
into effective January 1, 2008. Except as described below, the employment agreement for Mr. Copher
is substantially the same as the agreement for Mr. Blodnick. Mr. Cophers agreement provides for
an annual salary (currently $195,700) with subsequent increases subject to the board of directors
annual review of Mr. Cophers compensation and performance. Mr. Copher is prohibited from
competing with the Company or any of its subsidiaries during the term of the agreement and for a
two-year period following termination of employment.
If Mr. Cophers employment is terminated by the Company or its successor within two years
following a change in control, Mr. Copher will be entitled to receive an amount equal to two times
his then current annual salary, plus continued employment benefits for two years following
termination. This amount (two times annual salary plus continuation of benefits) would also be
payable if Mr. Copher terminates his employment within two years following a change in control. If
Mr. Cophers employment is terminated by the Company, other than for cause, in certain
circumstances following the announcement of a change in control that subsequently occurs, Mr.
Copher will be entitled to receive an amount equal to two times his then current annual salary,
payable in 24 monthly installments.
The table below shows the maximum amounts that could be paid to the Chief Executive Officer
and Chief Financial Officer under their respective agreements. The following information is based
on (i) the executives compensation at December 31, 2007; and (ii) assumes the triggering event was
December 31, 2007.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chief Executive Officer (1) |
|
|
Chief Financial Officer (1) |
|
|
|
|
|
|
|
Termination (without |
|
|
|
|
|
|
Termination (without |
|
|
|
Termination |
|
|
cause) or Termination |
|
|
Termination |
|
|
cause) or Termination |
|
|
|
(without cause) or by |
|
|
by Executive Due to a |
|
|
(without cause) or by |
|
|
by Executive Due to a |
|
|
|
Executive (with good reason) |
|
|
Change in Control (2) |
|
|
Executive (with good reason) |
|
|
Change in Control (2) |
|
Base salary |
|
$ |
315,000 |
|
|
$ |
941,850 |
|
|
$ |
190,000 |
|
|
$ |
380,000 |
|
Targeted bonus |
|
|
150,000 |
|
|
|
448,500 |
|
|
|
60,500 |
|
|
|
121,000 |
|
Healthcare and other benefits |
|
|
6,553 |
|
|
|
19,594 |
|
|
|
5,817 |
|
|
|
11,634 |
|
401(k) employer contribution (3) |
|
|
46,500 |
|
|
|
139,035 |
|
|
|
25,050 |
|
|
|
50,100 |
|
Fair market values of accelerated equity
vesting (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued Vacation |
|
|
24,231 |
|
|
|
72,450 |
|
|
|
14,615 |
|
|
|
29,231 |
|
Perquisites |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
542,284 |
|
|
$ |
1,621,429 |
|
|
$ |
295,982 |
|
|
$ |
591,965 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
In the event of death or disability, executive, or if applicable his estate, would be
paid any amounts earned through the termination date. |
28
|
|
|
(2) |
|
Represents payments to the Named Executive in the event of termination for the
following reasons: (i) without cause within three years of a change in control, (ii)
before a change in control and within six months of termination a change in control
occurs, or (iii) executive terminates his employment within three years of a change in
control. |
|
(3) |
|
Includes profit-sharing at 7%. |
|
(4) |
|
For the purposes of this table the fair market value of the accelerated vesting of
equity awards is determined as being the difference between the Companys December 31,
2007 closing stock price and the strike price of the accelerated equity awards. It is
expected that in the event of a change of control, the per-share settlement stock price
would be higher than that used in this table. |
Don J. Chery and Jon W. Hippler Employment Agreements. During calendar year 2007, Mr.
Cherys employment was governed by an employment agreement with Big Sky Western Bank, of which he
served as President. Mr. Chery entered into a new agreement effective January 1, 2008. During
calendar year 2007, Mr. Hipplers employment was governed by an employment agreement dated January
1, 2007 with Mountain West Bank, as ratified by the Company. The Agreement terminated December 31,
2007 and a new agreement was entered into, again with Mountain West Bank and ratified by the
Company, effective January 1, 2008.
Except as set forth below, the employment agreement for Mr. Chery is substantially the same as
the agreement for Mr. Copher. Mr. Cherys agreement provides for an annual salary (currently
$195,700), with subsequent increases subject to the board of directors annual review of Mr.
Cherys compensation and performance. The provisions of Mr. Cherys employment agreement regarding
incentive compensation, termination by the Company without cause or termination by Mr. Chery for
good reason, non-competition, and payments to which Mr. Chery may be entitled in connection with a
change in control, are the same as described above with respect to the agreement for Mr. Copher.
Mr. Hippler is employed as the President and CEO of Mountain West Bank, located in Coeur
dAlene, Idaho. In other regards, and except as set forth below, the employment agreement for Mr.
Hippler is substantially the same as the agreements for Messrs. Blodnick, Copher and Chery. Mr.
Hipplers current salary is $256,256. Incentive compensation is to be determined by Mountain West
Banks board of directors and ratified by the Companys board of directors. Mr. Hippler is
prohibited from competing with the Company or any of its subsidiaries during the term of the
agreement and for a one-year period following termination of employment.
If Mr. Hipplers employment is terminated by Mountain West Bank or its successor within one
year following a change in control, the agreement provides that Mr. Hippler will be entitled to
receive an amount equal to his then current annual salary, payable in 12 monthly installments, plus
continued employment benefits for one year following termination. This amount (one times annual
salary plus continuation of benefits) would also be payable if Mr. Hippler terminates his
employment within one year following a change in control. If Mr. Hipplers employment is
terminated by Mountain West Bank, other than for cause, in certain circumstances following
announcement of a change in control that subsequently occurs, Mr. Hippler will be entitled to
receive an amount equal to his then current annual salary, payable in 12 monthly installments.
The table below shows the maximum amounts that could be paid to Messrs. Chery and Hippler
under their respective agreements. The following information is based on (i) the executives
compensation at December 31, 2007; and (ii) assumes the triggering event was December 31, 2007.
29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Don J. Chery (1) |
|
|
Jon W. Hippler (1) |
|
|
|
|
|
|
|
Termination |
|
|
|
|
|
|
Termination |
|
|
|
|
|
|
|
(without cause) or |
|
|
|
|
|
|
(without cause) or |
|
|
|
Termination |
|
|
Termination by |
|
|
Termination |
|
|
Termination by |
|
|
|
(without cause) or |
|
|
Executive |
|
|
(without cause) or |
|
|
Executive |
|
|
|
by Executive (with |
|
|
Due to a Change in |
|
|
by Executive (with |
|
|
Due to a Change in |
|
|
|
good reason) |
|
|
Control (2) |
|
|
good reason) |
|
|
Control (2) |
|
Base salary |
|
$ |
171,073 |
|
|
$ |
342,146 |
|
|
$ |
231,155 |
|
|
$ |
231,155 |
|
Targeted bonus |
|
|
54,818 |
|
|
|
109,636 |
|
|
|
91,849 |
|
|
|
91,849 |
|
Healthcare and other benefits |
|
|
5,745 |
|
|
|
11,490 |
|
|
|
6,403 |
|
|
|
6,479 |
|
401(k) employer contribution (3) |
|
|
22,589 |
|
|
|
45,178 |
|
|
|
32,300 |
|
|
|
32,300 |
|
Fair market values of accelerated equity
vesting (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued Vacation |
|
|
13,159 |
|
|
|
26,319 |
|
|
|
17,781 |
|
|
|
17,781 |
|
Perquisites |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
267,385 |
|
|
$ |
534,769 |
|
|
$ |
379,488 |
|
|
$ |
379,564 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
In the event of death or disability, executive, or if applicable his estate,
would be paid any amounts earned through the termination date. |
|
(2) |
|
Represents payments to the Named Executive in the event of termination for the
following reasons: (i) without cause within two years of a change in control, (ii)
before a change in control and within six months of termination a change in control
occurs, or (iii) executive terminates his employment within three years of a change
in control. |
|
(3) |
|
Includes profit sharing at 7%. |
|
(4) |
|
For the purposes of this table the fair market value of the accelerated vesting
of equity awards is determined as being the difference between the Companys December
31, 2007 closing stock price and the strike price of the accelerated equity awards.
It is expected that in the event of a change of control, the per-share settlement
stock price would be higher than that used in this table. |
30
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Executive Officers who are not Directors
The following table sets forth information with respect to the Named Executives who are not
directors or nominees for director of the Company, and executive officers and directors as a group.
All executive officers are elected annually by the Board of Directors and serve at the discretion
of the Board of Directors.
|
|
|
|
|
|
|
|
|
|
|
Amount and Nature of |
|
|
|
|
Beneficial Ownership of |
|
|
|
|
Common Stock as of |
Name and Age |
|
Position |
|
January 15, 2008* |
Don J. Chery, 45 |
|
Executive Vice |
|
|
61,077 |
(2) |
|
|
President, Chief
Administrative
Officer of the |
|
|
.114 |
% |
|
|
Company; employed
since
1989(1) |
|
|
|
|
Ron J. Copher, 50 |
|
Senior Vice |
|
|
3,000 |
(3) |
|
|
President, Chief
Financial Officer,
Treasurer, and |
|
|
.006 |
% |
|
|
Assistant Secretary,
employed since 2006 |
|
|
|
|
Executive officers and directors |
|
|
2,348,566 |
(4) |
as agroup (11 individuals) |
|
|
4.37 |
% |
|
|
|
* |
|
Share amounts have been adjusted to reflect all stock splits and stock dividends on Glacier
stock. |
|
(1) |
|
Prior to his employment with the Company in the capacities indicated in 2007, Mr. Chery was
employed by Big Sky Western Bank. |
|
(2) |
|
Includes 39,102 shares held jointly with Mr. Cherys wife and 21,975 shares that could be
acquired within 60 days by the exercise of stock options. |
|
(3) |
|
Includes 3,000 shares held jointly with Mr. Cophers wife. |
|
(4) |
|
Includes 159,346 shares held by executive officers and directors as a group that could be
acquired within 60 days by the exercise of stock options and other rights. |
Beneficial Owners
The following table includes information as of December 31, 2007 concerning the only persons
or entities, including any group as that term is used in Section 13(d)(3) of the Securities
Exchange Act of 1934 (Exchange Act), who or which was known to the Company to be the beneficial
owner of more than 5% of the issued and outstanding Common Stock on the Annual Meeting record date.
|
|
|
|
|
|
|
|
|
|
|
Amount and Nature |
|
|
Name and Address of |
|
of Beneficial |
|
|
Beneficial Owner |
|
Ownership (1) |
|
Percent of Class |
Columbia Wanger Asset Management, L.P. (2) |
|
|
4,838,268 |
|
|
|
9.02 |
% |
227 West Monroe Street, Suite 3000
Chicago, Illinois 60606 |
|
|
|
|
|
|
|
|
T. Rowe Price Associates, Inc. (3) |
|
|
4,771,546 |
|
|
|
8.8 |
% |
100 E. Pratt Street
Baltimore, Maryland 21202 |
|
|
|
|
|
|
|
|
Private Capital Management, L.P. (4) |
|
|
3,956,187 |
|
|
|
7.4 |
% |
8889 Pelican Bay Blvd., Suite 500
Naples, Florida 34108 |
|
|
|
|
|
|
|
|
Barclays Global Investors, N.A. (5) |
|
|
2,687,629 |
|
|
|
5.01 |
% |
45 Fremont Street
San Francisco, California 94105 |
|
|
|
|
|
|
|
|
31
|
|
|
(1) |
|
Pursuant to rules promulgated by the SEC under the Exchange Act, a person or entity is
considered to beneficially own shares of common stock if the person or entity has or shares
(i) voting power, which includes the power to vote or to direct the voting of the shares, or
(ii) investment power, which includes the power to dispose or direct the disposition of the
shares. |
|
(2) |
|
Based on an amended Schedule 13G filed under the Exchange Act, the securities are
beneficially owned by Columbia Wanger Asset Management, L.P. (WAM), a registered investment
advisor, WAM Acquisition GP, Inc. (WAM GP), the general partner of WAM, and Columbia Acorn
Trust (Acorn), a registered investment company. Persons other than WAM and WAM GP,
including Acorn, are entitled to receive all dividends from, and proceeds from the sale of,
those securities. Acorn is the beneficial owner of 8.44% of Glacier common stock. |
|
(3) |
|
Based on an amended Schedule 13G filed under the Exchange Act. The securities are
beneficially owned by various individual and institutional investors, which T. Rowe Price
Associates, Inc. (Price Associates) serves as investment adviser with power to direct
disposition and/or sole power to vote the securities. For purposes of the reporting
requirements of the Exchange Act, Price Associates is deemed to be a beneficial owner of such
securities; however, Price Associates expressly disclaims that it is, in fact, the beneficial
owner of such securities. |
|
(4) |
|
Based on a Schedule 13G filed under the Exchange Act. The securities are beneficially owned
by Private Capital Management, L.P. (PCM), a registered investment advisor, with sole power
to direct the disposition and voting of certain of the securities (12,300 shares ) and shared
power to direct the disposition and voting of certain securities (3,943,887 shares). PCM
expressly disclaims beneficial ownership of shares over which it has dispositive power. |
|
(5) |
|
Based on a Schedule 13G filed under the Exchange Act. The securities are beneficially owned
by Barclays Global Investors, NA and related entities, including Barclays Global Fund Advisors
and Barclays Global Investors, Ltd. Barclays Global Investors, NA reported beneficial
ownership of 1,041,965 shares, or 1.94% of outstanding common stock. Barclays Global Fund
Advisors reported beneficial ownership of 1,590,860 shares, or 2.97% of outstanding common
stock, and Barclays Global Investors reported beneficial ownership of 54,804 shares, or 0.10%
of outstanding common stock. |
PROPOSAL NO. 2 TO AMEND THE COMPANYS
ARTICLES OF INCORPORATION
General
Article 7.A. of the Companys Articles of Incorporation currently provides that the Board of
Directors be divided into three classes, as nearly equal in number a possible, with members of each
class serving three-year terms.
The Board of Directors has unanimously adopted resolutions, subject to shareholder approval,
approving an amendment to Article 7.A. of the Articles of Incorporation to eliminate the staggered
board provision. The proposal would provide for the annual election of all directors, commencing
with the 2009 annual meeting in the manner described below. The Board of Directors has set the
current number of directors at nine. The proposal would not change the present number of directors
and the directors will retain the authority to change that number and to fill any vacancies or
newly created directorships.
Background
Staggered boards have been widely adopted and have a long history in corporate law.
Proponents of staggered boards assert that they promote the independence of directors because
directors elected for
32
multi-year terms are less subject to outside influence, as well as providing continuity and
stability in the management of the business and affairs of a company.
In recent years, however, an increasing number of companies have taken action to eliminate
staggered terms for directors, resulting in the annual election of all directors. Some investors
view staggered or classified boards as having the effect of reducing the accountability of
directors to shareholders because staggered boards limit the ability of shareholders to evaluate
and elect all directors on an annual basis. The election of directors is a primary means for
shareholders to influence corporate governance policies and to hold management accountable for
implementing those policies.
Given the current corporate governance environment and taking into account the pros and cons
of a staggered board, the Nominating/Corporate Governance Committee of the Board of Directors has
endorsed eliminating the Companys staggered board. The Committee has recommended to the full
Board of Directors the adoption of the amendment to the Companys Articles of Incorporation to
eliminate the staggered board and provide for the annual election of all directors.
If Proposal No. 2 is approved by the shareholders, the terms for all directors would end at
the 2009 annual meeting. Commencing with the 2009 annual meeting, all directors would be elected
for one-year terms at each subsequent annual meeting.
If this proposal is adopted, any director appointed by the Board of Directors as a result of a
newly created directorship or to fill a vacancy would hold office until the next occurring annual
meeting.
The proposed amendment to the Articles of Incorporation will result in the deletion and
replacement of Section 7.A. and an amendment to Section 7.B. of the Articles of Incorporation, as
set forth in Exhibit A to this proxy statement. If approved, this proposal will become
effective upon the filing of Articles of Amendment with the Montana Secretary of State, which the
Company would do promptly after the annual meeting.
Vote Required and Board Recommendation
In order for the amendment to be adopted, the proposal must be approved by the holders of at
least a majority of the outstanding shares of the Companys common stock. If you abstain, or if
your shares are held in street name and you do not instruct your broker on how to vote your shares,
your shares will not be voted and the effect will be the same as a vote against the proposal.
Therefore, it is important that you vote your shares either at the meeting or by proxy.
The Board of Directors unanimously recommends that you vote FOR the proposed amendment.
33
TRANSACTIONS WITH MANAGEMENT
Certain Transactions
Transactions between the Company or its affiliates and related persons (including directors
and executive officers of the Company or their immediate family) must generally be approved by the
Audit Committee (or a comparable committee of independent disinterested directors), in accordance
with the policies and procedures set forth in the policy governing Related Persons Transactions
adopted by the Board of Directors. Under the Related Persons Transaction Policy, a transaction
between a related person will be consummated only if the designated committee, or a majority of
the disinterested independent members of the Board, approves or ratifies such transaction in
accordance with the guidelines set forth in the policy and if the transaction is on terms
comparable to those that could be obtained in arms length dealings with an unrelated third party.
During 2007 certain directors and executive officers of the Company and its subsidiaries, and
their associates, were customers of one or more of the Companys subsidiary banks, and it is
anticipated that such individuals will continue to be customers in the future. All transactions
between the Companys subsidiary banks and its executive officers and directors, and their
associates, were made in the ordinary course of business on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable transactions with
other persons, and, in the opinion of management, did not involve more than the normal risk of
collectability or present other unfavorable features.
COMPLIANCE WITH SECTION 16(a) FILING REQUIREMENTS
Section 16(a) of the Securities Exchange Act of 1934 requires that all of the Companys
executive officers and directors and all persons who beneficially own more than 10 percent of
Company common stock file reports with the SEC regarding beneficial ownership of Company stock.
The Company has adopted procedures to assist its directors and executive officers in complying with
the Section 16(a) filings.
Based solely on the Companys review of the copies of the filings that it received for the
fiscal year ended December 31, 2007, or written representations from certain reporting persons, the
Company believes that all reporting persons made all filings required by Section 16(a) on a timely
basis.
REGISTERED PUBLIC ACCOUNTANTS
BKD, LLP (BKD), independent registered public accounting firm, performed the audit of our
consolidated financial statements, which include our subsidiaries, for the year ended December 31,
2007. A representative of BKD will be present at the Annual Meeting and will be available to
respond to appropriate questions, and will have the opportunity to make a statement if he or she
desires.
Fees Paid to Independent Registered Public Accounting Firm
The following table sets forth the aggregate fees charged to the Company by BKD, for audit
services rendered in connection with the audited consolidated financial statements and reports for
the 2007 and 2006 fiscal years.
34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fee Category |
|
Fiscal 2007 |
|
% of Total |
|
Fiscal 2006 |
|
% of Total |
Audit Fees |
|
$ |
786,013 |
|
|
|
94.8 |
% |
|
$ |
701,326 |
|
|
|
99.9 |
% |
Audit-Related Fees |
|
|
43,130 |
|
|
|
5.2 |
% |
|
|
200 |
|
|
|
00.1 |
% |
Tax Fees |
|
|
0 |
|
|
|
00.0 |
% |
|
|
0 |
|
|
|
00.0 |
% |
All Other Fees |
|
|
0 |
|
|
|
00.0 |
% |
|
|
0 |
|
|
|
00.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fees |
|
$ |
829,260 |
|
|
|
100 |
% |
|
$ |
701,526 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Audit Fees. Consists of fees billed to Glacier for professional services rendered by
BKD in connection with the audits of the Companys financial statements and the effectiveness of
internal controls over financial accounting, and the reviews of financial statements included in
Glaciers Form 10-Qs or services to Glacier in connection with statutory or regulatory filings or
engagements.
Audit-Related Fees. Fees relate to technical accounting research in 2007.
Tax Fees. There were no fees incurred for tax services for the fiscal years ended
December 31, 2007 and 2006.
All Other Fees. There were no fees for services not included above for the fiscal
years ended December 31, 2007 and 2006.
In considering the nature of the services provided by BKD, the Audit Committee determined that
such services are compatible with the provision of independent audit services. The Audit Committee
discussed these services with BKD and Company management to determine that they are permitted under
the rules and regulations concerning auditor independence promulgated by the SEC to implement the
Sarbanes Act, as well as the American Institute of Certified Public Accountants.
Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
The services performed by BKD in 2007 were pre-approved in accordance with the pre-approval
policy and procedures adopted by the Audit Committee. This policy describes the permitted audit,
audit-related, tax, and other services (collectively, the Disclosure Categories) that BKD may
perform. The policy requires that prior to the beginning of each fiscal year, a description of the
services (the Service List) expected to be performed by BKD in each of the Disclosure Categories
in the following fiscal year be presented to the Audit Committee for approval.
Services provided by BKD during the following year that are included in the Service List were
pre-approved following the policies and procedures of the Audit Committee.
Any requests for audit, audit-related, tax, and other services not contemplated on the Service
List must be submitted to the Audit Committee for specific pre-approval and cannot commence until
such approval has been granted. Normally, pre-approval is provided at regularly scheduled
meetings. However, the authority to grant specific pre-approval between meetings, as necessary,
has been delegated to the Chairman of the Audit Committee. The Chairman must update the Audit
Committee at the next regularly scheduled meeting of any services that were granted specific
pre-approval.
In addition, although not required by the rules and regulations of the SEC, the Audit
Committee generally requests a range of fees associated with each proposed service on the Service
List and any services that were not originally included on the Service List. Providing a range of
fees for a service
35
incorporates appropriate oversight and control of the independent auditor relationship, while
permitting the Company to receive immediate assistance from BKD when time is of the essence.
The Audit Committee reviews the status of services and fees incurred year-to-date against the
original Service List and the forecast of remaining services and fees for the fiscal year.
OTHER BUSINESS
The Board knows of no other matters to be brought before the shareholders at the Annual
Meeting. If other matters are properly presented for a vote at the Annual Meeting, the proxy
holders will vote shares represented by properly executed proxies in their discretion in accordance
with their judgment on such matters.
SHAREHOLDER PROPOSALS AND DIRECTOR NOMINATIONS
Shareholder Proposals
In order for a shareholder proposal to be considered for inclusion in our Proxy Statement for
next years annual meeting, the written proposal must be received by the Company no later than
November 28, 2008 and should contain such information as is required under the our Bylaws. Such
proposals need to comply with the SECs regulations regarding the inclusion of shareholder
proposals in Company-sponsored proxy materials. No shareholder proposal from the floor will be
considered at the annual meeting. In addition, if we receive notice of a shareholder proposal
after November 28, 2008, the persons named as proxies in such proxy statement and form of proxy
will have discretionary authority to vote on such shareholder proposal.
Director Nominations
The Companys Bylaws provide for the nomination of director candidates by its shareholders. In
order to recommend that the Nominating Committee consider a person for inclusion as a director
nominee in the Companys proxy statement for next years annual meeting, the Company must receive a
recommendation no later than November 28, 2008. In addition, the notice of recommendation must
meet all other requirements contained in the Companys Bylaws. Such recommendation should be sent
to the attention of the Secretary of the Company, and should contain the following information:
(a) the name and address of each proposed nominee and the number of shares of Company stock held by
such nominee; (b) the principal occupation of each proposed nominee; (c) a description of any
arrangements or understandings between the nominee and the nominating shareholder pursuant to which
the nomination is being made; (d) your name and address; (e) the number of shares of stock of the
Company you own; and (f) a consent of the nominee agreeing to the nomination. The presiding
officer of the meeting may disregard your nomination if it does not contain the above information
and otherwise meet the requirements set forth in the Companys Bylaws.
Copy of Bylaw Provisions
You may contact the Companys Corporate Secretary for a copy of the relevant Bylaw provisions
regarding the requirements for making shareholder proposals and nominating director candidates.
ANNUAL REPORT TO SHAREHOLDERS
Any shareholder may obtain without charge a copy of our Annual Report on Form 10-K filed with
the SEC under the Securities Exchange Act of 1934 for the year ended December 31, 2007,
36
including financial statements. Written requests for the Form 10-K should be addressed to LeeAnn
Wardinsky, Corporate Secretary, at 49 Commons Loop, Kalispell, Montana 59901. The Annual Report is
also available at www.glacierbancorp.com.
DELIVERY OF DOCUMENTS TO SHAREHOLDERS SHARING AN ADDRESS
In some cases, only one copy of this Proxy Statement is being delivered to multiple
shareholders sharing an address unless we have received contrary instructions from one or more of
the shareholders. We will deliver promptly, upon written request, a separate copy of this Proxy
Statement to a shareholder at a shared address to which a single copy of the document was
delivered. To request a separate delivery of these materials now or in the future, a shareholder
may submit a written or oral request to the Companys Corporate Secretary at the address above, or
by calling (406) 756-4200. Additionally, any shareholders who are presently sharing an address and
receiving multiple copies of either the Proxy Statement or the Annual Report and who would rather
receive a single copy of such materials may instruct us accordingly by directing their request to
us in the manner provided above
|
|
|
|
|
March 28, 2008
|
|
BY ORDER OF THE BOARD OF DIRECTORS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LeeAnn Wardinsky, Secretary |
|
|
37
GLACIER BANCORP, INC.
PROXY
PLEASE SIGN AND RETURN IMMEDIATELY
This Proxy Is Solicited on Behalf of the Board of Directors
The undersigned shareholder of Glacier Bancorp, Inc. (the Company) hereby appoints L. Peter
Larson and Everit A. Sliter, and each of them (with full power to act alone), my Proxies, with full
power of substitution as Proxy, and hereby authorizes such Proxies to represent and to vote, as
designated below, all the shares of common stock of the Company held of record by the undersigned
on March 3, 2008, at the Annual Meeting of Shareholders to be held on April 30, 2008, or any
adjournment of such Annual Meeting.
1. |
|
ELECTION OF DIRECTORS FOR CLASS TO EXPIRE IN 2011 |
|
A. |
|
I vote FOR all nominees listed below (except as marked to the contrary below) o |
|
|
B. |
|
I WITHHOLD AUTHORITY to vote for any individual nominee whose name I have
struck a line through in the list below: |
Michael J. Blodnick u Allen J. Fetscher u John W. Murdoch
|
C. |
|
I WITHHOLD AUTHORITY to vote for all nominees listed above. o |
2. |
|
AMEND THE COMPANYS ARTICLES OF INCORPORATION to eliminate the staggered terms of the Board
of Directors. |
|
|
|
|
|
|
|
|
|
|
|
FOR o
|
|
AGAINST o
|
|
ABSTAIN o
|
|
|
3. |
|
WHATEVER OTHER BUSINESS as may properly be brought before the Annual Meeting or any
adjournment thereof. |
THIS PROXY CONFERS AUTHORITY TO VOTE FOR AND WILL BE VOTED FOR THE PROPOSAL LISTED UNLESS
AUTHORITY IS WITHHELD, IN WHICH CASE THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATION
SO MADE.
Management knows of no other matters that may properly be, or which are likely to be, brought
before the Annual Meeting. However, if any other matters are properly presented at the Annual
Meeting, this Proxy will be voted in accordance with the recommendations of management.
The Board of Directors recommends a vote FOR the listed directors and proposal.
|
|
|
|
|
, 2008
|
|
|
|
, 2008 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Signature of Shareholder
|
|
|
|
Signature of Shareholder |
ALL JOINT OWNERS MUST SIGN.
WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE
GIVE FULL TITLE. IF MORE THAN ONE TRUSTEE, ALL SHOULD SIGN.