SCHEDULE 14A INFORMATION
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. ___)
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ]Preliminary Proxy Statement [ ]Confidential, for Use of the
[x]Definitive Proxy Statement Commission Only (as permitted
[ ]Definitive Additional Materials by Rule 14a-6(e)(2))
[ ]Soliciting Material Under Rule 14a-12
AMERIANA BANCORP, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
1. Title of each class of securities to which transaction applies:
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2. Aggregate number of securities to which transaction applies:
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3. 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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[ ] Fee paid previously with preliminary materials:___________________________
[ ] 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.
1. Amount Previously Paid:
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4. Date Filed:
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[AMERIANA BANCORP LETTERHEAD]
April 20, 2001
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders
of Ameriana Bancorp, to be held at the main office of Ameriana Bank and Trust,
2118 Bundy Avenue, New Castle, Indiana, on Thursday, May 24, 2001, at 10:00 a.m.
The attached notice of the annual meeting and proxy statement describe
the formal business to be transacted at the meeting. During the meeting, we will
also report on the operations of the Company. Directors and officers of the
Company will be present to respond to appropriate questions of shareholders.
Detailed information concerning our activities and operating
performance during our fiscal year ended December 31, 2000, is contained in our
annual report, which is also enclosed.
Please sign, date and promptly return the enclosed proxy card. If you
attend the meeting, you may vote in person even if you have previously mailed a
proxy card.
We look forward to seeing you at the meeting.
Sincerely,
/s/ Harry J. Bailey
Harry J. Bailey
President and Chief Executive Officer
AMERIANA BANCORP
2118 BUNDY AVENUE
NEW CASTLE, INDIANA 47362
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 24, 2001
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The Annual Meeting of Shareholders (the "Annual Meeting") of Ameriana
Bancorp (the "Company") will be held at 2118 Bundy Avenue, New Castle, Indiana,
on Thursday, May 24, 2001, at 10:00 a.m.
A Proxy Card and a Proxy Statement for the Annual Meeting are enclosed.
The Annual Meeting is for the purpose of considering and acting upon:
1. The election of two directors of the Company;
2. The ratification of the appointment of Olive LLP as auditors for
the Company for the fiscal year ending December 31, 2001; and
3. Such other matters as may properly come before the Annual Meeting
or any adjournments thereof.
NOTE: The Board of Directors is not aware of any other business to come
before the Annual Meeting.
Any action may be taken on any one of the foregoing proposals at the Annual
Meeting on the date specified above, or on any date or dates to which, by
original or later adjournment, the Annual Meeting may be adjourned. Shareholders
of record at the close of business on March 30, 2001, are the shareholders
entitled to vote at the Annual Meeting and any adjournments thereof.
You are requested to fill in and sign the enclosed form of proxy which is
solicited by the Board of Directors and to mail it promptly in the enclosed
envelope. The proxy will not be used if you attend and vote at the Annual
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Nancy A. Rogers
Nancy A. Rogers
Secretary
New Castle, Indiana
April 20, 2001
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES IN ORDER TO INSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN
THE UNITED STATES.
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PROXY STATEMENT
OF
AMERIANA BANCORP
2118 BUNDY AVENUE
NEW CASTLE, INDIANA 47362
ANNUAL MEETING OF SHAREHOLDERS
MAY 24, 2001
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Ameriana Bancorp (the "Company") to be used
at the Company's Annual Meeting of Shareholders (the "Annual Meeting"), which
will be held at the main office of its wholly owned subsidiary, Ameriana Bank
and Trust of Indiana (the "Bank"), 2118 Bundy Avenue, New Castle, Indiana, on
Thursday, May 24, 2001, at 10:00 a.m. The accompanying notice of meeting and
this Proxy Statement are being first mailed to shareholders on or about April
20, 2001.
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VOTING AND REVOCATION OF PROXIES
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Shareholders who execute proxies retain the right to revoke them at any
time. Unless so revoked, the shares represented by such proxies will be voted at
the Annual Meeting and all adjournments thereof. Proxies may be revoked by
written notice to the Secretary of the Company or by the filing of a later-dated
proxy prior to a vote being taken on a particular proposal at the Annual
Meeting. A written notice of revocation of a proxy should be sent to the
Secretary, Ameriana Bancorp, 2118 Bundy Avenue, New Castle, Indiana 47362 and
will be effective if received by the Secretary prior to the Annual Meeting. A
previously submitted proxy will also be revoked if a shareholder attends the
Annual Meeting and votes in person. Proxies solicited by the Board of Directors
will be voted in accordance with the directions given therein. Where no
instructions are indicated, proxies will be voted for the nominees for directors
set forth below and in favor of the other proposals set forth in this Proxy
Statement for consideration at the Annual Meeting. Any proxies marked as
abstentions will not be counted as votes cast. In addition, any shares held in
street name which have been designated by brokers on proxy cards as not voted
will not be counted as votes cast. Any proxies marked as abstentions or as
broker non-votes will, however, be treated as shares present for purposes of
determining whether a quorum is present.
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VOTING SECURITIES AND SECURITY OWNERSHIP
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Shareholders of record as of the close of business on March 30, 2001 (the
"Record Date"), are entitled to one vote for each share then held. As of the
Record Date, the Company had 3,146,616 shares of common stock, par value $1.00
per share (the "Common Stock"), issued and outstanding. The presence, in person
or by proxy, of at least a majority of the total number of shares of Common
Stock outstanding and entitled to vote will be necessary to constitute a quorum
at the Annual Meeting.
The following table sets forth information as of the Record Date (i) with
respect to any person who was known to the Company to be the beneficial owner of
more than five percent of the Common Stock and (ii) as to the Common Stock
beneficially owned by each director of the Company, by each executive officer of
the Company named in the "Summary Compensation Table" below and by all directors
and executive officers of the Company as a group. All beneficial ownership is by
sole voting and investment power, except as otherwise indicated.
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF
BENEFICIAL OWNER OWNERSHIP (1) COMMON STOCK (2)
---------------- ------------- ----------------
Harry J. Bailey 68,466 2.16%
Donald C. Danielson 108,904 3.46%
Charles M. Drackett, Jr. 18,480 0.59%
R. Scott Hayes 30,600 0.97%
Michael E. Kent 25,300 0.80%
Paul W. Prior 118,301 3.75%
Ronald R. Pritzke 22,122 0.70%
Timothy G. Clark 22,800 0.72%
Richard E. Welling 20,316 0.64%
All Directors and Executive 555,121 16.81%
Officers as a Group (15 persons)
Dimensional Fund Advisors, Inc. 218,164 (3) 6.93%
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401
<FN>
_____________
(1) As to the Company's directors and executive officers, includes 23,851, -0-,
8,800, 8,800, 8,800, 8,250, 9,625, 13,200, and 12,496 shares which may be
acquired by Messrs. Bailey, Danielson, Drackett, Hayes, Kent, Prior,
Pritzke, Clark and Welling, respectively, and 155,819 shares which may be
acquired by all directors and executive officers as a group upon the
exercise of stock options which are exercisable within 60 days of the
Record Date.
(2) In calculating the percentage ownership of any individual or group, the
number of shares of Common Stock outstanding is deemed to include any
shares which the individual or group may acquire through the exercise of
options exercisable within 60 days as of the Record Date.
(3) Dimensional Fund Advisors, Inc., a registered investment advisor, reported
sole voting power over 218,164 shares and sole dispositive power over
218,164 shares as of February 2, 2001.
</FN>
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PROPOSAL I -- ELECTION OF DIRECTORS
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The Board of Directors of the Company is comprised of seven members and is
divided into three classes as nearly equal in number as possible. Directors
serve for staggered three-year terms with one class standing for election at
each annual meeting. At the Annual Meeting, two current directors will stand for
election. The Board of Directors has nominated Donald C. Danielson and Paul W.
Prior to serve as directors for the terms indicated below. Directors are elected
by a plurality of the votes cast. If any nominee is unable to serve, the shares
represented by all valid proxies will be voted for the election of such
substitute director as the Board of Directors may recommend. At this time, the
Board knows of no reason why any nominee might be unable to serve.
2
The following table sets forth for each nominee and for each director
continuing in office, such person's name and age and the year he first became a
director of the Company.
YEAR FIRST
ELECTED OR CURRENT
APPOINTED TERM
NAME AGE (1) DIRECTOR TO EXPIRE
---- ------- -------- ---------
BOARD NOMINEES FOR A TERM TO EXPIRE IN 2004
Donald C. Danielson 81 1989 2001
Paul W. Prior 79 1989 2001
DIRECTORS CONTINUING IN OFFICE
Harry J. Bailey 58 1989 2002
Charles M. Drackett, Jr. 50 1989 2002
Ronald R. Pritzke 53 1992 2002
R. Scott Hayes 54 1989 2003
Michael E. Kent 60 1989 2003
<FN>
____________
(1) At December 31, 2000.
</FN>
Listed below is certain information about the directors of the Company.
DONALD C. DANIELSON is Vice Chairman of City Securities Corporation of
Indianapolis. He served on the Board of Trustees of Indiana University for 21
years and was Chairman of the Board for 11 years. He currently is a member of
the James Whitcomb Riley Memorial Association Board of Governors, a Director of
the Indiana University Foundation, Indiana Chamber of Commerce, National
Fellowship of Christian Athletes, Indiana Basketball Hall of Fame and Chairman
of the Board for the Walther Cancer Foundation. He served as a member of
President Bush's Credit Standards Advisory Committee in 1991. He has been a
Director of the Bank since 1971 and Director of the Company since its formation.
PAUL W. PRIOR is the Chairman of the Boards of the Company and the Bank. He
joined the Bank as Chairman of the Board, President and Chief Executive Officer
in January 1973, after having served another savings institution as Chief
Executive Officer for 20 years. He became Chairman of the Board, President and
Chief Executive Officer of the Company at the time of its formation in 1989. Mr.
Prior served as National Chairman of the United States League of Savings
Institutions in 1984. He is a life member of the Board of Directors of the
Indiana Chamber of Commerce.
HARRY J. BAILEY has been President of the Company and the Bank since May
1990, and was appointed Chief Executive Officer in December 1990. Mr. Bailey had
been the Executive Vice President and Chief Operating Officer of the Company
since its formation in 1989 and of the Bank since February 1984. He has been a
Director of the Bank since 1987 and a Director of the Company since its
formation. From June 1983 to January 1984, Mr. Bailey, an attorney, acted as a
consultant to financial institutions and for 15 years before, served in the
legal department and as operations officer for thrift institutions in the
Chicago area. He currently serves on the Board of Directors of the Federal Home
Loan Bank of Indianapolis, Chairman and Director of the Indiana Bankers
Association, Trustee of the Henry County Memorial Hospital, Director of the New
Castle/Henry County Economic Development Corporation, Director of the Henry
County Community Foundation and a Director of the Indiana Chamber of Commerce.
3
CHARLES M. (KIM) DRACKETT, JR. is Vice Chairman, President and General
Manager of Fairholme Farms Inc. in Lewisville, Indiana. He founded the Maximum
Economic Yield Club in Lewisville to provide a means of sharing innovative
farming techniques, and is a graduate of the Indiana Institute of Food and
Nutrition in Indianapolis. Mr. Drackett currently serves as a Director of The
Cincinnati Nature Center and Chairman of its Agricultural Operations Committee.
He has been a Director of the Bank since 1989 and Director of the Company since
its formation.
RONALD R. PRITZKE is a partner in the law firm Pritzke & Davis in
Greenfield, Indiana. He is past President of the Greater Greenfield Chamber of
Commerce. He is also a founding member, past President and currently on the
Hancock County Community Foundation Board. In addition, he is a founding member
and currently President of Regreening Greenfield, Inc. and a co-founding member
and Director of Park Advocacy Research and Conservation Society. Mr. Pritzke
served as a member of the Greenfield Public Library Board for ten years. He is a
former member of the Board of the Hancock County Cancer Society. Mr. Pritzke has
been a Director of the Company and the Bank since his appointment in December
1992.
R. SCOTT HAYES is a partner in Hayes Copenhaver Crider, New Castle,
Indiana, the law firm which serves as General Counsel to the Company. He is
President of the Henry County Redevelopment Commission. He is past Chairman of
the New Castle/Henry County Economic Development Corporation, a Trustee of
Wittenbraker YMCA and the President and a Director of BETA MU House Association,
Inc. He has been a Director of the Bank since 1984 and Director of the Company
since its formation.
MICHAEL E. KENT is a private investor. Prior to his retirement in January
1996, Mr. Kent was Chairman, President and Chief Executive Officer of
Modernfold, Inc. He was past President and is currently an Advisory Director of
the Alumni Board of the Department of Mechanical and Industrial Engineering at
the University of Illinois. He has been a Director of the Bank since 1987 and
Director of the Company since its formation.
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MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
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The Board of Directors of the Company conducts its business through
meetings of the Board and its committees. During the fiscal year ended December
31, 2000, the Company's Board of Directors held 12 regular meetings and one
special meeting. No director of the Company attended fewer than 75% of the total
meetings of the Board of Directors and committees on which such director served
during this period. Each member of the Board of Directors of the Company also
serves as a member of the Board of Directors of the Bank and various committees
thereof.
The Company's Board of Directors has an Audit Committee, which is
responsible for the review and evaluation of the Company's annual audit and
related financial matters. This committee consists of Chairman Hayes and
Directors Kent, Drackett and Pritzke. The members of the Audit Committee are
"independent," as "independent" is defined in Rule 4200(a)(15) of the National
Association of Securities Dealers' listing standards. The Company's Board of
Directors has adopted a written charter for the Audit Committee. A copy of the
Audit Committee's charter is attached to this Proxy Statement as Appendix A.
This committee met three times during fiscal 2000.
The Company's full Board of Directors acts as a nominating committee for
the annual selection of its nominees for election as directors. While the Board
of Directors will consider nominees recommended by shareholders, it has not
actively solicited recommendations from shareholders or established any
procedures for this purpose. The Company's Board met once in this capacity
during fiscal 2000.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION. The Company's
Board of Directors has also appointed a Committee on Compensation and Stock
Options, which serves as the Company's Compensation Committee and is responsible
for administering the wage, salary and stock option plans of the
4
Company and the Bank. This committee consists of Chairman Danielson and
Directors Hayes and Kent. During the past fiscal year, Mr. Hayes' law firm has
performed services for the Company and the Bank. See "Transactions with
Management." This committee met two times during fiscal 2000.
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DIRECTOR COMPENSATION
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DIRECTORS FEES. All of the members of the Company's Board of Directors are
also members of the Bank's Board of Directors. The Company's directors, except
the Chairman, receive fees of $6,600 annually. The Company's Chairman receives
fees of $12,600. The Bank's directors receive annual fees of $6,000 and $500 for
each Board meeting they attend. Employees who serve as directors do not receive
directors' fees. The Bank's directors, except employee directors, also receive
fees of $300 for each Board committee meeting they attend.
DIRECTOR SUPPLEMENTAL RETIREMENT PROGRAM. In order to provide retirement
benefits for non-employee directors, the Bank has established a director
supplemental retirement program that became effective June 4, 1999. Pursuant to
the program, the Bank has established pre-retirement accounts for the benefit of
each of the non-employee directors which are increased or decreased each year by
an amount equal to the difference between the after-tax earnings on specified
adjustable life insurance contracts less that year's premium expense and less
the Bank's cost of funds expense on premiums paid to date (the "Index Retirement
Benefit"). If the directors continue in office until normal retirement age (the
later of 65 or five years from the effective date of the program), they will be
entitled to receive the balance in their pre-retirement account in ten equal
annual installments plus any additional Index Retirement Benefit accruing to
their account for each year thereafter. In the event of disability, the
directors will become 100% vested in their accounts and entitled to immediately
begin receiving their retirement benefits. In the event of the director's death,
the remaining unpaid balance of their account shall be paid in a lump sum to
their designated beneficiaries. If the directors resign prior to their normal
retirement age, they will be entitled to receive a percentage of the balance in
their pre-retirement account plus a percentage of the Index Retirement Benefit
accuring thereafter. The applicable percentage will be equal to 10% times their
number of years of service up to 100%. In the event their service is terminated
following a change in control, they will be entitled to receive their benefits
at normal retirement age as if they had been continuously serving until that
time. For purposes of the agreements, a change in control will occur if any
corporation, person or group acquires more than 25% of the voting stock of the
Company or the Bank. At December 31, 2000, the balances in the pre-retirement
accounts of Messrs. Prior, Danielson, Drackett, Hayes, Kent and Pritzke were
$29,431, $21,757, $6,120, $9,672, $14,349 and $8,282, respectively.
In order to fund the benefits payable under the Director Supplemental
Retirement Program, the Bank has purchased life insurance policies on each
director. The policies are designed to offset the program's costs during the
lifetime of the participant and to provide complete recovery of all the
program's costs at their death. The Bank has entered into split dollar
agreements with each of the directors pursuant to which their beneficiaries are
entitled to a death benefit equal to 80% of the net at risk insurance portion of
the policy proceeds (total proceeds less cash value of the policy) if the
director dies while serving on the Board or has retired or terminated service
due to disability. If the director is otherwise not serving on the Board at his
death, his beneficiaries will be entitled to a reduced death benefit.
5
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EXECUTIVE COMPENSATION
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SUMMARY COMPENSATION TABLE. The following table sets forth information
regarding cash and noncash compensation for each of the last three fiscal years
awarded to or earned by (i) the Company's Chief Executive Officer, and (ii) the
two other most highly compensated executive officers of the Company and
subsidiaries who were serving as such at the end of the fiscal year and whose
total salary and bonus for the year exceeded $100,000 for services rendered in
all capacities to the Company and its subsidiaries.
ANNUAL COMPENSATION
------------------------------------------------- ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OTHER ANNUAL (1) COMPENSATION
- --------------------------- ------ ------ ----- ---------------- ------------
Harry J. Bailey 2000 $ 245,000 $ -- $ -- $ 2,031 (2)
President and Chief Executive 1999 230,000 -- -- --
Officer of the Company 1998 219,000 32,800 -- --
and the Bank
Timothy G. Clark 2000 $ 140,000 $ -- $ -- $ 466 (2)
Executive Vice President and 1999 132,000 -- -- --
Chief Operating Officer of the 1998 125,000 12,500 -- --
Company and the Bank
Richard E. Welling 2000 $ 105,000 $ -- $ -- $ 1,025 (2)
Senior Vice President-Treasurer 1999 100,000 -- -- --
of the Company and the Bank 1998 95,000 9,500 -- --
<FN>
- -----------
(1) The value of perquisites and personal benefits received by any named
executive officer did not exceed the lesser of $50,000 or 10% of salary and
bonus in 2000, 1999 or 1998.
(2) Consists of income attributable to split dollar plan agreement.
</FN>
OPTION EXERCISES AND YEAR-END VALUES. The following table sets forth
information regarding the number and value of options held by the named
executive officers at the end of 2000. No named executive officer exercised
options during the last fiscal year.
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT YEAR-END OPTIONS AT YEAR-END (1)
-------------------------- --------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ------------- ----------- -------------
Harry J. Bailey 23,851 0 $ 0 $ 0
Timothy G. Clark 13,200 3,300 0 0
Richard E. Welling 12,496 3,124 0 0
<FN>
____________
(1) Options are considered in-the-money if the market value of the underlying
securities exceeds the exercise price of the options. None of the options
held by the named executive officers were in-the-money at fiscal year end.
</FN>
EMPLOYMENT AGREEMENTS. The Bank has entered into employment agreements with
Harry J. Bailey, Timothy G. Clark and Richard E. Welling as President and Chief
Executive Officer, Chief Operating Officer and Senior Vice President-Treasurer,
respectively. The agreements currently provide for minimum annual salaries of
$255,000, $147,500 and $109,000, respectively, and terms of three years. Each
agreement provides for annual salary review by the Board of Directors, as well
as inclusion of the executives in any discretionary bonus plans, customary
fringe benefits, vacation and sick leave. The agreements provide that the Bank
may terminate the executives at any time. In the event an executive is
terminated for a reason other than "cause," as defined in the
6
agreements, normal retirement or disability, the Bank will continue to pay the
executive (or his beneficiary or estate) at his highest monthly salary rate for
the remainder of the term of the agreement, provided that the total of such
payments does not exceed three times his annual rate of salary as of the date of
termination.
Each of these agreements provides that in the event of disability, the
executive shall continue to receive their full compensation for the first 18
months from the date of such disability at which time the Bank may terminate the
agreement and the executive shall receive 60% of his monthly salary at the time
he became disabled until the earlier of his death or his normal retirement date
under the Bank's pension plan. The agreements provide that these amounts shall
be offset by any amounts paid to the executives under any other disability
program maintained by the Bank.
The agreements further provide that if: (a) after a change in control of
the Bank or the Company, the Bank (i) terminates the employment of the
executives for any reason other than cause, retirement or disability, (ii)
otherwise changes the present capacity or circumstances of their employment, or
(iii) reduces their responsibilities, authority, compensation or benefits
(including, in the case of Mr. Bailey, the failure to elect or re-elect him to
the Board of Directors of the Bank or the Company) without their written
consent; (b) the executive voluntarily terminates their employment within 30
days following a change in control; or (c) during the period beginning six
months before a change in control and ending on the later of one year after the
change in control or the expiration date of the agreement, the Bank changes the
present capacity or circumstances of their employment or reduces their
responsibilities, authority, compensation or benefits (including, in the case of
Mr. Bailey, the failure to elect or re-elect him to the Board of Directors of
the Bank or the Company) without their written consent, the Bank shall promptly
pay the executives a sum equal to 2.99 times the average annual compensation
paid to them for the five most recent taxable years ending before the change in
control subject to such reduction as may be required to prevent the payment from
being deemed an "excess parachute payment" under Section 280G of the Internal
Revenue Code of 1986. "Change in control" generally refers to the acquisition by
any person or entity of the ownership or power to vote more than 25% of the
Company's stock, the ability to control the election of a majority of the Bank's
or the Company's directors, controlling influence over the management or
policies of the Bank or the Company by any person or group or a change in the
majority of the Board of Directors over any two-year period which was not
approved by two-thirds of the incumbent directors. In the event of termination
of employment in connection with a change in control which would activate such
severance payment provisions, the estimated amounts payable to Messrs. Bailey,
Clark and Welling would be $692,604, $403,300 and $307,809, respectively, based
upon their compensation during the five years ended December 31, 2000.
PENSION PLAN. The following table shows the estimated annual benefits
payable under the Bank's defined-benefit pension plan based upon the respective
years-of-service and compensation indicated below as calculated under the plan.
AVERAGE OF HIGH YEARS OF SERVICE AT AGE 65
FIVE YEARS ----------------------------------------------------------------
COMPENSATION 5 10 20 30 40
------------- ------- ------ ------ ------ ------
$ 50,000 $ 3,750 $ 7,500 $15,000 $22,500 $30,000
75,000 5,625 11,250 22,500 33,750 45,000
100,000 7,500 15,000 30,000 45,000 60,000
150,000 11,250 22,500 45,000 67,500 90,000
200,000 15,000 30,000 60,000 90,000 120,000
The compensation covered by the plan consists of the employee's salary and
bonus (as set forth under "Annual Compensation" in the Summary Compensation
Table above) up to applicable legal limits (currently $160,000). As of December
31, 2000, Messrs. Bailey, Clark and Welling had 17, 3 and 3 years of service,
respectively, under the plan. Benefits under the plan are computed on the basis
of compensation and years of service and are not subject to any deduction for
social security or other offset amounts.
7
EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN. In order to supplement the
retirement benefits to which executive officers are entitled under the Company's
pension plan, the Bank has entered into executive supplemental retirement plan
agreements with Messrs. Bailey, Clark and Welling effective February 23, 1999.
The agreements with the executives establish pre-retirement accounts similar to
those established under the director supplemental retirement program agreements
described in "Director Compensation." If the executives remain in the employment
of the Bank until age 65, they will be entitled to receive the balance in their
pre-retirement account in ten equal annual installments plus any additional
Index Retirement Benefits accruing each year thereafter. In the event of
disability, the executives will become 100% vested in their accounts and
entitled to immediately begin receiving their retirement benefits. In the event
of the executive's death, the remaining unpaid balance of their account shall be
paid in a lump sum to their designated beneficiaries. If the executives
voluntarily resign or are terminated without cause prior to age 65, they will be
entitled to receive a percentage of the balance in their pre-retirement account
and a percentage of the Index Retirement Benefit for each year after age 65
provided that they have completed five years of service since the effective date
of the agreement. The applicable percentage will be equal to 5% times their
number of years of service after the fifth anniversary of the agreements. In the
event the executives are terminated following a change in control, they will be
entitled to receive their benefits at age 65 as if they had been continuously
employed until age 65. For purposes of the agreements, a change in control will
occur if any corporation, person or group acquires more than 25% of the voting
stock of the Company or the Bank. If an executive is discharged prior to
completing five years of service from the effective date of the agreements or is
discharged at any time for cause, they will forfeit all benefits under the
agreements. At December 31, 2000, the balances in the pre-retirement accounts of
Messrs. Bailey, Clark and Welling were $86,000, $12,000 and $16,000,
respectively.
In order to fund the benefits payable under the Executive Supplemental
Retirement Plan, the Bank has purchased variable life insurance policies on
Messrs. Bailey, Clark and Welling. The policies are designed to offset the
program's costs during the lifetime of the participant and to provide complete
recovery of all the program's costs at their death. The Board is the sole owner
of these policies and has exclusive rights to the cash surrender value. The
Company has entered into split dollar agreements with the executives similar to
those entered into with directors.
REPORT OF COMMITTEE ON COMPENSATION AND STOCK OPTIONS
The Committee on Compensation and Stock Options (the "Compensation
Committee") of the Board of Directors is composed entirely of outside directors
and has overall responsibility to review and recommend compensation plans and
structure to the Board with respect to the Company's executive compensation
policies. In addition, the Compensation Committee recommends on an annual basis
the compensation to be paid to the Chief Executive Officer and each of the other
executive officers of the Company. The Committee also reviews and makes
recommendations on annual cash bonus programs, long-term incentive programs,
grants of stock options and other executive benefits. The Committee has
available to it access to independent compensation data.
The Compensation Committee's executive compensation philosophy is to
provide competitive levels of compensation, integrate management's pay with the
achievement of the Company's annual and long-term performance goals, reward
exceptional corporate performance, recognize individual initiative and
achievement and assist the Company in attracting and retaining qualified
management. Management compensation is intended to be set at levels that the
Compensation Committee believes is consistent with others in the Company's
industry, with attention given to rewarding management based upon the Company's
level of performance.
The Compensation Committee endorses the position that equity ownership by
management is beneficial in aligning management's and shareholders' interests in
the enhancement of shareholder value.
Base salaries for all employees are determined by evaluating the
responsibilities of the position held and by reference to the competitive
marketplace for talent, including a comparison of base salaries for comparable
positions at comparable companies within the banking industry. Minimum, midpoint
and maximum levels are then established within the base salary ranges that are
used to recognize the performance of an individual.
8
Annual salary adjustments are determined by evaluating changes in
compensation in the marketplace, the performance of the company, the performance
of the executive and any increased responsibilities assumed by the executive.
Above-average performance is recognized and rewarded by placing an executive at
a higher level in the salary range.
The Company has an annual incentive plan for executive officers. The
purpose of this plan is to provide a direct financial incentive in the form of
annual cash bonuses to executives if the Company's annual goals relating to net
income and return on equity are met. Threshold, target and maximum performance
goals are set by the Board of Directors at the beginning of each fiscal year, as
well as the maximum percentage of base salary that can be earned. Individual
performance is taken into account in determining a portion of the bonus, but no
bonus is paid unless predetermined threshold levels of net income and return on
equity are met.
A stock option program is the Company's long-term incentive plan for
executive officers and key employees. The objectives of the program are to align
executive and shareholder long-term interests by creating a strong and direct
link to shareholder return, and to enable executives to develop and maintain a
significant, long-term ownership position in the Company's Common Stock.
The base salary of the Chief Executive Officer is established by the terms
of the employment agreement entered into between Mr. Bailey and the Bank. The
Chief Executive Officer's base salary under the agreement was determined on the
basis of the Committee's review and evaluation of the compensation of chief
executives of other financial institutions similar in size to the company. The
Chief Executive Officer's bonus is determined under the same criteria used for
all executive officers as a group.
In fiscal 2000, the Company did not exceed the targeted performance
objectives under the incentive bonus plan, and no bonus was awarded.
COMMITTEE ON COMPENSATION AND STOCK OPTIONS
AMERIANA BANCORP
Donald C. Danielson (Chairman)
R. Scott Hayes
Michael E. Kent
9
STOCK PERFORMANCE
The following graph shows the cumulative total return on the Common Stock
over the last five years, compared with the cumulative total return of the CRSP
Index for Nasdaq stocks of savings institutions (U.S. Companies, SIC 6030-39)
(the "Industry Index") and the CRSP Index for the Nasdaq Stock Market (U.S.
Companies, all SIC) (the "Market Index") over the same period, as if $100 were
invested on December 31, 1995 in the Common Stock and each index. Cumulative
total return represents the total increase in value since December 31, 1995,
assuming reinvestment of all dividends paid.
CUMULATIVE TOTAL SHAREHOLDER RETURN
COMPARED WITH PERFORMANCE OF SELECTED INDEXES
DECEMBER 31, 1995 THROUGH DECEMBER 31, 2000
[Line graph appears here depicting the cumulative total shareholder return
of $100 invested in the Common Stock as compared to $100 invested in the CRSP
Index for Nasdaq Stocks of Savings Institutions and the Nasdaq Stock Market
Index-U.S. Line graph begins at December 31, 1995 and plots the cumulative total
return at December 31, 1996, 1997, 1998, 1999 and 2000. Plot points are provided
below.]
12/31/95 12/31/96 12/31/97 12/31/98 12/31/99 12/31/00
-------- -------- -------- -------- -------- --------
Ameriana Bancorp 100 116.6 149.8 150.4 132.7 98.4
Nasdaq Stock Market 100 123.0 150.7 212.5 394.8 237.4
Savings Institutions 100 128.0 221.8 203.7 174.7 225.1
10
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TRANSACTIONS WITH MANAGEMENT
- --------------------------------------------------------------------------------
The Bank offers mortgage and consumer loans to its directors, officers and
employees. In the opinion of management, these loans do not involve more than
the normal risk of collectibility and are made in the ordinary course of
business and on substantially the same terms, including interest rates, as those
prevailing at the time for nonaffiliated persons.
The law firm of Hayes Copenhaver Crider, of which R. Scott Hayes, a
director of the Company and the Bank, the Chairman of the Audit Committee and a
member of the Committee on Compensation and Stock Options, is a partner, serves
as General Counsel to the Company and performs legal services to the Company and
the Bank on a regular basis. Estimated legal fees for services rendered to the
Company and its subsidiaries by the law firm of Hayes Copenhaver Crider during
2000 amounted to approximately $63,656.
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PROPOSAL II -- RATIFICATION OF APPOINTMENT OF AUDITORS
- --------------------------------------------------------------------------------
Olive LLP, which was the Company's independent auditing firm for 2000, has
been retained by the Board of Directors to be the Company's auditors for 2001,
subject to ratification by the Company's shareholders. A representative of Olive
LLP is expected to be present at the Annual Meeting, and he will have the
opportunity to make a statement if he desires to do so and will be available to
respond to appropriate questions.
AUDIT FEES. During the fiscal year ended December 31, 2000, the aggregate
fees billed by Olive LLP for professional services rendered in the audit of the
Company's annual financial statements and the reviews of the financial
statements included in the Company's Quarterly Reports on Form 10-Q filed during
the fiscal year ended December 31, 2000, were $56,950.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES. The Company
did not engage Olive LLP to provide advice to the Company regarding financial
information systems design and implementation during the fiscal year ended
December 31, 2000.
ALL OTHER FEES. For the fiscal year ended December 31, 2000, the aggregate
fees paid by the Company to Olive LLP for all other services (other than audit
services and financial information systems design and implementation services)
were $26,220.
The Audit Committee of the Board of Directors has considered whether the
provision of the services covered under the captions "Financial Information
Systems Design and Implementation Fees" and "All Other Fees" is compatible with
maintaining the independence of Olive LLP.
The appointment of the auditors must be ratified by a majority of the votes
cast by the shareholders of the Company at the Annual Meeting. THE BOARD OF
DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE RATIFICATION OF THE
APPOINTMENT OF AUDITORS.
- --------------------------------------------------------------------------------
REPORT OF THE AUDIT COMMITTEE
- --------------------------------------------------------------------------------
The Audit Committee of the Board of Directors (the "Audit Committee") has:
1. Reviewed and discussed the audited financial statements for the fiscal
year ended December 31, 2000, with the management of the Company.
11
2. Discussed with the Company's independent auditors the matters required
to be discussed by Statement of Auditing Standards No. 61, as the same
was in effect on the date of the Company's financial statements; and
3. Received the written disclosures and the letter from the Company's
independent auditors required by Independence Standards Board Standard
No. 1 (Independence Discussions with Audit Committees), as the same
was in effect on the date of the Company's financial statements and
discussed with the independent auditors their independence.
Based on the foregoing materials and discussions, the Audit Committee
recommended to the Board of Directors that the audited financial statements for
the fiscal year ended December 31, 2000, be included in the Company's Annual
Report on Form 10-K for the year ended December 31, 2000.
MEMBERS OF THE AUDIT COMMITTEE
R. SCOTT HAYES (Chairman)
MICHAEL E. KENT
CHARLES M. DRACKETT, JR.
RONALD R. PRITZKE
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
- --------------------------------------------------------------------------------
Pursuant to regulations promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), the Company's officers and directors and
all persons who own more than 10% of the Common Stock ("Reporting Persons") are
required to file reports detailing their ownership and changes of ownership in
the Common Stock and to furnish the Company with copies of all such ownership
reports that are filed. Based solely on the Company's review of the copies of
such ownership reports which it has received in the past fiscal year or with
respect to the past fiscal year, or written representations that no annual
report of changes in beneficial ownership were required, the Company believes
that during fiscal year 2000 all Reporting Persons have complied with these
reporting requirements.
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OTHER MATTERS
- --------------------------------------------------------------------------------
The Board of Directors is not aware of any business to come before the
Annual Meeting other than those matters described above in this Proxy Statement.
However, if any other matters should properly come before the Annual Meeting, it
is intended that proxies in the accompanying form will be voted in respect
thereof in accordance with the determination of a majority of the Board of
Directors.
- --------------------------------------------------------------------------------
MISCELLANEOUS
- --------------------------------------------------------------------------------
The cost of solicitation of proxies will be borne by the Company. In
addition to solicitations by mail, directors and officers of the Company may
solicit proxies personally or by telegraph or telephone without additional
compensation.
The Company's Annual Report to Shareholders for 2000 accompanies this proxy
statement. Such Annual Report is not to be treated as a part of the proxy
solicitation material nor as having been incorporated herein by reference. A
COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2000, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WILL BE
FURNISHED WITHOUT CHARGE TO SHAREHOLDERS
12
AS OF THE RECORD DATE, UPON WRITTEN REQUEST TO THE SECRETARY, AMERIANA BANCORP,
2118 BUNDY AVENUE, NEW CASTLE, INDIANA 47362.
- --------------------------------------------------------------------------------
SHAREHOLDER PROPOSALS
- --------------------------------------------------------------------------------
In order to be eligible for inclusion in the Company's proxy materials for
next year's Annual Meeting of Shareholders, any shareholder proposal to take
action at such meeting must be received at the Company's headquarters, 2118
Bundy Avenue, New Castle, Indiana 47362, no later than December 21, 2001. Any
such proposals shall be subject to the requirements of the proxy rules adopted
under the Exchange Act.
Shareholder proposals, other than those submitted pursuant to the Exchange
Act, must be delivered or mailed in writing, in the form prescribed by the
Company's Articles of Incorporation, to the Secretary of the Company at the
address given in the preceding paragraph not less than thirty days nor more than
sixty days prior to any such meeting; provided, however, that if less than
thirty-one days' notice of the meeting is given to shareholders, such written
notice shall be delivered or mailed, as prescribed, to the Secretary of the
Company not later than the close of the tenth day following the day on which
notice of the meeting was mailed to shareholders.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Nancy A. Rogers
Nancy A. Rogers
Secretary
New Castle, Indiana
April 20, 2001
13
Appendix A
AMERIANA BANCORP
AUDIT COMMITTEE CHARTER
The responsibility of the "Ameriana Bancorp Audit Committee", hereinafter
referred to as the "Committee" shall be to assist the Board of Directors in
fulfilling its responsibilities to the shareholders by determining that
management has established a system to provide reasonable assurance that
financial disclosures reasonably portray Ameriana Bancorp's ("Company")
financial condition. The Committee shall establish and maintain lines of
communications between itself and the Board of Directors, the Internal Auditor,
the Company's independent auditors, and management. The Committee intends to
fulfill its responsibilities as follows:
COMPOSITION
A. The Committee should be comprised of three of more directors as
elected by the Board. Each member will be independent of the
management of the Company and free of any relationship that, in the
opinion of the Board of Directors, would interfere with their exercise
of judgment as a Committee member.
B. The members of the Committee shall have a working familiarity with
basic finance and accounting practices, and at least one member of the
Committee shall have accounting or related financial management
expertise.
FINANCIAL REPORTING
A. The Committee will be responsible for reviewing, on a periodic basis,
the Ameriana Bank and Trust's external auditing program.
B. The Committee will oversee the quarterly regulatory reporting process
by annually reviewing the process with the Chief Financial Officer.
The Committee will also review copies of all filings made with the
Securities and Exchange Commission and the Office of Thrift
Supervision on a timely basis subsequent to the reports being filed.
C. The Committee will review management reports on all cases of financial
misconduct by employees, officers or directors and consider the
implications thereof on the adequacy of internal controls.
D. The Committee will make itself available to consult with management
when management seeks a second opinion on accounting or auditing
questions.
A-1
INDEPENDENT AUDITORS
A. The Committee will annually review the independence of the external
auditors.
B. The Committee will review the responsibilities of the external
auditors.
C. The Committee will recommend the appointment of external auditors and
develop an engagement letter for each external audit.
D. The Committee will receive and review the results of each external
audit, particularly with regard to internal controls, significant
accounting policies and financial reporting issues.
E. The Committee will review management's response to the auditor's
recommendations regarding internal control, significant accounting
policies and financial reporting issues.
INTERNAL CONTROL
A. The Committee will be responsible for reviewing, on an annual basis,
the Company's internal audit plan and audit policies.
B. The Committee will be responsible for reviewing, on a period basis,
the Company's internal audit reports.
C. The Committee will direct special investigations into significant
matters brought to its attention within the scope of its duties.
D. The Committee will report its activities to the Board on a regular
basis.
A-2
[X] PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE AMERIANA BANCORP
ANNUAL MEETING OF SHAREHOLDERS WITH-
MAY 24, 2001 FOR HOLD EXCEPT
I. The election as directors of all [ ] [ ] [ ]
nominees listed below (except as
The undersigned hereby appoints the full Board marked to the contrary below).
of Directors of the Company or a majority thereof with
full powers of substitution, to act as attorneys and DONALD C. DANIELSON
proxies for the undersigned, and to vote all shares
of common stock of the Company which the undersigned PAUL W. PRIOR
is entitled to vote at the Annual Meeting of Shareholders,
to be held at the main office of Ameriana Bank and Trust,
2118 Bundy Avenue, New Castle, Indiana, Thursday, INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
May 24, 2001, at 10:00 a.m. and at any and all adjournments NOMINEE, MARK "EXCEPT" AND WRITE THAT NOMINEE'S NAME IN THE
thereof, as follows: SPACE PROVIDED BELOW.
_____________________________________________________________
FOR AGAINST ABSTAIN
II. The ratification of the appointment [ ] [ ] [ ]
of Olive LLP as auditors for the
fiscal year ending December 31, 2001.
The Board of Directors recommends a vote "FOR" each of the
listed propositions.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS
ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR EACH OF THE
PROPOSITIONS STATED. IF ANY OTHER BUSINESS IS PRESENTED AT SUCH
ANNUAL MEETING, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
DETERMINATION OF A MAJORITY OF THE BOARD OF DIRECTORS.
AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER
_____________________ BUSINESS TO BE PRESENTED AT THE ANNUAL MEETING. THIS PROXY
Please be sure to sign and date |Date | ALSO CONFERS DISCRETIONARY AUTHORITY ON THE BOARD OF
this Proxy in the box below. | | DIRECTORS TO VOTE WITH RESPECT TO APPROVAL OF THE MINUTES OF
_____________________________________|_____________________| THE PRIOR ANNUAL MEETING OF SHAREHOLDERS, THE ELECTION OF
| | ANY PERSON AS DIRECTOR WHERE THE NOMINEE IS UNABLE TO SERVE
| | OR FOR GOOD CAUSE WILL NOT SERVE, AND MATTERS INCIDENT TO
- --Shareholder sign above----Co-holder (if any) sign above-- THE CONDUCT OF THE 2001 ANNUAL MEETING.
____________________________________________________________________________________________________________________________________
* DETACH ABOVE CARD, DATE, SIGN AND MAIL IN POSTAGE-PAID ENVELOPE PROVIDED. *
AMERIANA BANCORP
__________________________________________________________________________________________________________________________________
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
__________________________________________________________________________________________________________________________________
IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED BELOW AND RETURN THIS PORTION WITH
THE PROXY IN THE ENVELOPE PROVIDED.
_____________________________________________________
_____________________________________________________
_____________________________________________________