UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[x] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the fiscal year ended December 31, 2001.
Commission file number 0-13814
| Cortland Bancorp |
| (Exact name of registrant as specified in its charter) |
Ohio |
34-1451118 | |
(State or other jurisdiction of |
(I.R.S. Employer Identification No.) | |
incorporation or organization) |
||
l94 West Main Street
Cortland, Ohio |
44410 | |
(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (330) 637-8040
Securities registered pursuant to Section l2(b) of the Act: None
Securities registered pursuant to Section l2(g) of the Act:
| Common Stock, no par value |
| (Title of Class) |
Indicate by check mark whether the registrant (l) has filed all reports required to be filed by Section l3 or l5(d) of the Securities Exchange Act of l934 during the preceding l2 months (or for shorter periods that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes x No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (229.405 of the chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of the Form 10-K or any amendment of this Form 10-K [ x ].
The aggregate market value of the voting stock held by nonaffiliates of the registrant as of March 20, 2002:
Common Stock, No Par Value - $85,981,421
The number of shares outstanding of the issuer’s classes of common stock as of March 20, 2002:
Common Stock, No Par Value -3,917,149 shares
DOCUMENTS INCORPORATED BY REFERENCE
| Portions of the Annual Shareholders Report for the year ended December 31, 2001 are incorporated by reference into Parts I and II. |
| Portions of the Proxy Statement for the annual shareholders meeting to be held April 16, 2002 are incorporated by reference into Part III. |
CORTLAND BANCORP
FORM 10-K
2001
INDEX
| Part I | Page | |||||
Item l. |
Business: | |||||
General |
I-2 | |||||
Statistical Disclosure |
I-3 | |||||
Item 2. |
Properties | I-6 | ||||
Item 3. |
Legal Proceedings | I-6 | ||||
Item 4. |
Submission of Matters to a Vote of Security Holders | I-7 | ||||
Executive Officers of the Registrant |
I-7 | |||||
Part II |
||||||
Item 5. |
Market for Registrant’s Common Equity and Related Stockholder Matters | II-1 | ||||
Item 6. |
Selected Financial Data | II-1 | ||||
Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
II-1 | ||||
Item 7A. |
Quantitative and Qualitative Disclosure About Market Risk | II-1 | ||||
Item 8. |
Financial Statements and Supplementary Data | II-1 | ||||
Item 9. |
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosures |
II-1 | ||||
Part III |
||||||
Item l0. |
Directors and Executive Officers of the Registrant | III-1 | ||||
Item ll. |
Executive Compensation | III-1 | ||||
Item l2. |
Security Ownership of Certain Beneficial Owners and
Management |
III-1 | ||||
Item l3. |
Certain Relationships and Related Transactions | III-1 | ||||
Part IV |
||||||
Item l4. |
Exhibits, Financial Statement Schedules and Reports
on Form 8-K |
IV-1 | ||||
Signatures |
IV-2 | |||||
Index to Exhibits |
IV-3 | |||||
I-l
PART I
Item l. Business
General
THE CORPORATION
Information relating to Item 1 — Business General — THE CORPORATION — is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 4, Brief Description of the Business and is incorporated herein by reference.
CORTLAND BANKS
Information relating to Item 1 — Business General — CORTLAND BANKS — is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 4, Brief Description of the Business and is incorporated herein by reference.
NEW RESOURCES LEASING COMPANY
Information relating to Item 1 — Business General — NEW RESOURCES LEASING COMPANY — is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 4, Brief Description of the Business and is incorporated herein by reference.
SUPERVISION AND REGULATION
Information relating to Item 1 — Business General — SUPERVISION AND REGULATION — is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 4, Brief Description of the Business and is incorporated herein by reference.
COMPETITION
Information relating to Item 1 — Business General — COMPETITION — is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 4, Brief Description of the Business and is incorporated herein by reference.
EMPLOYEES
Information relating to Item 1 — Business General — EMPLOYEES — is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 4, Brief Description of the Business and is incorporated herein by reference
I-2
Statistical Disclosure
| I. | DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS’ EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL |
Information relating to I — Distribution of Assets, Liabilities and Shareholders’ Equity; Interest Rates and Interest Differential is set forth in the Corporation’s 2001 Annual Report to Shareholders under the pages indicated below and is incorporated herein by reference:
| Pages in 2001 | ||
| Annual Report | ||
| to Shareholders | ||
A.
Average Balance Sheet —
December 31, 2001, 2000 and 1999 |
28 & 29 | |
B. Analysis of Net Interest Earnings —
Years ending December 31, 2001, 2000 and 1999 |
28 & 29 | |
C. Rate and Volume Analysis —
2001 change from 2000 and 2000 change from 1999 |
33 |
| II. | INVESTMENT PORTFOLIO |
Information relating to II — Investment Portfolio is set forth in the Corporation’s 2001 Annual Report to Shareholders under the pages indicated below and is incorporated herein by reference:
| Pages in 2001 | ||||
| Annual Report | ||||
| to Shareholders | ||||
A. Book value of investments —
December 31, 2001, 2000 and 1999 |
40 | |||
B. Summary of securities held —
December 31, 2001 |
40 & 41 | |||
C. N/A |
||||
I-3
III. LOAN PORTFOLIO (ALL DOMESTIC)
A. TYPES OF LOANS
Information relating to III — Loan Portfolio — A. Types of Loans is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 37, Loan Portfolio and is incorporated herein by reference.
B. MATURITIES AND SENSITIVITIES OF LOANS TO INTEREST RATES
Information relating to III — Loan Portfolio — B. Maturities and Sensitivities of Loans to Interest Rates is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 37, Loan Portfolio and is incorporated herein by reference.
C. RISK ELEMENTS
Information relating to III — Loan Portfolio — C. Risk Elements, is set forth in the Corporation’s 2001 Annual Report to Shareholders under the pages indicated below and is incorporated herein by reference:
| Pages in 2001 | |||||||
| Annual Report | |||||||
| to Shareholders | |||||||
1. Nonaccrual, Past Due and Restructured Loans |
|||||||
(1) |
Aggregate amount in each category (5 years) | 32 | |||||
(2) |
Interest income | ||||||
| (i) That would have been recorded | 15 & 32 | ||||||
(ii) That was included in income |
15 & 32 | ||||||
(3) |
Policy for placing loans on non-accrual status | 10 & 15 | |||||
2. Potential Problem Loans |
16 | ||||||
3. Foreign Outstandings |
N/A | ||||||
4. Loan concentrations over 10% not otherwise disclosed |
N/A | ||||||
D. Other Interest Bearing Assets — N/A
I-4
IV. SUMMARY OF LOAN LOSS EXPERIENCE
| A. Analysis of the Allowance for Loan Loss |
| Information relating to IV — Summary of Loan Loss Experience — A. Analysis of the Allowance for Loan Loss is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 35, Loan Loss Experience and is incorporated herein by reference. |
| B. Breakdown of the Allowance for Loan Losses |
| Information relating to IV — Summary of Loan Loss Experience — B. Breakdown of the Allowance for Loan Losses is set forth in the Corporation’s 2001 Annual Report to Shareholders under the pages indicated below and is incorporated herein by reference. |
| Pages in 2001 | ||||
| Annual Report | ||||
| to Shareholders | ||||
Breakdown of the Allowance for Loan Losses |
36 | |||
Percentage of loans in each category |
37 | |||
Loan Commitments and Lines of Credit |
19 | |||
V. DEPOSITS (ALL DOMESTIC)
| A. Average Deposits and Average Rates Paid on Deposit Categories |
| Information relating to V — Deposits — A. Average Deposits and Rates is set forth in the Corporation’s 2001 Annual Report to Shareholders, Pages 28 & 29, Three Year Summary Average Balance Sheet, Yields and Rates and is incorporated herein by reference. |
| B. Not applicable | |
| C. Not applicable | |
| D. Summary of Time Deposits of $100,000 or More |
| Information relating to V — Deposits — D. Summary of Time Deposits of $100,000 or More by Maturity Range, is set forth in the Corporation’s 2001 Annual Report to Shareholders, Page 17, Note 6, Deposits and is incorporated herein by reference. |
VI. RETURN ON EQUITY AND ASSETS
Information relating to VI — Return on Equity and Assets is set forth in the Corporation’s 2001 Annual Report to Shareholders, page 27, Selected Financial Data and is incorporated herein by reference.
I-5
Item 2. Properties
CORTLAND BANCORP’S PROPERTY
Information relating to Item 2 — Properties — is set forth in the Corporation’s 2001 Annual Report to Shareholders, page 4, Brief Description of the Business — CORTLAND BANCORP — and is incorporated herein by reference.
CORTLAND BANKS’ PROPERTY
Information relating to Item 2 — Properties — is set forth in the Corporation’s 2001 Annual Report to Shareholders, page 4, Brief Description of the Business, THE CORTLAND SAVINGS AND BANKING COMPANY — and is incorporated herein by reference.
Information relating to Item 2 — Properties — Location of Offices is set forth in the Corporation’s 2001 Annual Report to Shareholders, page 52, Cortland Banks Offices and Locations and is incorporated herein by reference.
Item 3. Legal Proceedings
Information relating to Item 3 — Legal Proceedings — is set forth in the Corporation’s 2001 Annual Report to Shareholders, page 25, Note 16, Litigation and is incorporated herein by reference.
I-6
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this report.
Executive Officers of the Registrant
The names, ages and positions of the executive officers as of March 20, 2002 are as follows:
| Name | Age | Position Held | ||||||
Rodger W. Platt |
66 | Chairman of the Board, | ||||||
| President and Director | ||||||||
Lawrence A. Fantauzzi |
54 | Senior Vice President, Controller, | ||||||
| Secretary, Treasurer and | ||||||||
| Chief Financial Officer | ||||||||
James M. Gasior |
42 | Senior Vice President, Chief of | ||||||
| Lending and Administration | ||||||||
All of the officers listed above will hold office until the next annual meeting of shareholders and until their successors are duly elected and qualified.
Principal Occupation and Business Experience of Executive Officers
During the past five years the business experience of each of the executive officers has been as follows:
Rodger W. Platt has been Chairman of the Board of Cortland Bancorp and the subsidiary bank since November l987. He has been a Director and President of Cortland Bancorp since its formation in April of l985. He has been a Director of the subsidiary bank since l974 and has been President since l976.
Lawrence A. Fantauzzi has been the Controller of Cortland Bancorp and the subsidiary bank since April l987. He became Treasurer and Chief Financial Officer of Cortland Bancorp and the subsidiary bank in December 1992. He became a Director of New Resources Leasing Company in November 1995, and Senior Vice President of the subsidiary bank in April 1996. In February 1999, he was elected Secretary of the Corporation and appointed to the Board of Directors of Cortland Bancorp and the subsidiary bank.
James M. Gasior has been Senior Vice President of Lending and Administration of Cortland Bancorp and it’s subsidiary bank, since April 1999. He had previously been Senior Vice President and Chief Operations Officer from April 1996 through March 1999, and Vice President and Chief Operations Officer of Cortland Bancorp and subsidiary from June 1993 through March 1996. He became a Director of New Resources Leasing Company in November 1995.
I-7
PART II
Information relating to Items 5, 6, 7, 7A and 8 is set forth in the Corporation’s 2001 Annual Report to Shareholders under the pages indicated below and is incorporated herein by reference:
| Pages in 2001 | ||||||||
| Annual Report | ||||||||
| to Shareholders | ||||||||
Item 5 |
Market for Registrant's Common Equity and | |||||||
| Related Shareholder Matters | 49 | |||||||
| Discussion of Dividend Restrictions | 25 | |||||||
Item 6 |
Selected Financial Data | 27 | ||||||
Item 7 |
Management's Discussion and Analysis of | |||||||
| Financial Condition and Results of Operations | 30-48 | |||||||
Item 7A |
Quantitative and Qualitative Disclosures About | |||||||
| Market Risk | 44-45, | |||||||
| 47-48 | ||||||||
Item 8 |
Financial Statements and Accompanying Information | 1-29 | ||||||
Item 9 |
Changes in and Disagreements with Accountants | |||||||
| on Accounting and Financial Disclosures | ||||||||
| None | ||||||||
II-1
PART III
Item l0. Directors and Executive Officers of the Registrant
Information relating to directors of the Corporation will be set forth in the Corporation’s definitive proxy statement to be filed with the Securities and Exchange Commission in connection with its annual meeting of shareholders to be held April 16, 2002. Such information is incorporated herein by reference. Information relating to executive officers of the Corporation is set forth in Part I. Pages 2-8, 10-14 and 16-17.
Item ll. Executive Compensation
Information relating to this item will be set forth in the Corporation’s definitive proxy statement to be filed with the Securities and Exchange Commission in connection with its annual meeting of shareholders to be held April 16, 2002. Such information is incorporated herein by reference. Pages 7-8 and 10.
Item l2. Security Ownership of Certain Beneficial Owners and Management
| None |
Item l3. Certain Relationships and Related Transactions
Information relating to this item will be set forth in the Corporation’s definitive proxy statement to be filed with the Securities and Exchange Commission in connection with its annual meeting of shareholders to be held April 16, 2002. Such information is incorporated herein by reference. Page 3,4 & 9.
III-l
PART IV
Item l4. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) l. Financial Statements
| Included in Part II of this report: |
| Item 8., Financial Statements and Accompanying Information, is set forth in the Corporation’s 2001 Annual Report to Shareholders and is incorporated by reference in Part II of this report. |
(a) 2. Financial Statement Schedules
| Included in Part IV of this report as Exhibit 23: |
| Independent Accountants’ Consent |
| Schedules:
All schedules are omitted because they are not applicable. |
(a) 3. Exhibits
| The exhibits filed or incorporated by reference as a part of this report are listed in the Index to Exhibits which appears at page IV-3 hereof and is incorporated herein by reference. |
| (b) Report on Form 8-K |
| No reports on Form 8-K were filed for the three months ended December 31, 2001. |
IV-l
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| CORTLAND BANCORP | ||
| March 26, 2002 Date |
By Rodger W. Platt, President |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| Chairman of the Board, | ||||
| Rodger W. Platt | President and Director | March 26, 2002 | ||
| (Principal Executive Officer) |
Date | |||
| David C. Cole | Director | March 26, 2002 | ||
| Date | ||||
| George E. Gessner | Director | March 26, 2002 | ||
| Date | ||||
| William A. Hagood | Director | March 26, 2002 | ||
| Date | ||||
| James E. Hoffman, III | Director | March 26, 2002 | ||
| Date | ||||
| Richard B. Thompson | Director | March 26, 2002 | ||
| Date | ||||
| K. Ray Mahan | Director | March 26, 2002 | ||
| Date | ||||
| Timothy K. Woofter | Director | March 26, 2002 | ||
| Date | ||||
| Lawrence A. Fantauzzi | Senior Vice President, | March 26, 2002 | ||
| Controller, Secretary, | Date | |||
| Treasurer and Chief | ||||
| Financial Officer | ||||
| James M. Gasior | Senior Vice President, | March 26, 2002 | ||
| Chief of Lending and | Date | |||
| Administration |
IV-2
INDEX TO EXHIBITS
The following exhibits are filed or incorporated by reference as part of this report:
| 3.i. | Articles of Incorporation of the Corporation as currently in effect and any amendments thereto, (incorporated by reference to Registrant’s Registration Statement on Form S-3 filed on October 28, 1993, exhibit A). | |
| 3.ii. | Bylaws and/or Code of Regulations of the Corporation as currently in effect (incorporated herein by reference to Registrant’s Registration Statement on Form S-3 on October 28, 1993, exhibit B). | |
| 4 | The rights of holders of equity securities are defined in portions of the Articles of Incorporation and Bylaws as referenced in 3.l. and 3.2. | |
| 11 | Statement regarding computation of earnings per share (filed herewith). | |
| 13 | Annual Report to security holders (filed herewith). | |
| 21 | Subsidiaries of the Registrant (filed herewith). | |
| 23 | Consents of experts and counsel — Consent of independent accountants (filed herewith). |
Copies of any exhibits will be furnished to shareholders upon written request. Requests should be directed to Lawrence A. Fantauzzi, Secretary, Cortland Bancorp, l94 West Main Street, Cortland, Ohio 444l0.
IV-3