SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by Registrant [ ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14A-11(c) or ss. 240.14a-12
FFW Corporation
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
FFW Corporation
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
Common Stock.
2) Aggregate number of securities to which transaction applies:
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):
Cash payment for securities totals .
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] 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 previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
[FFW CORPORATION LETTERHEAD]
September 25, 1996
Dear Fellow Stockholder:
On behalf of the Board of Directors and management of FFW Corporation
(the "Company"), we cordially invite you to attend the Annual Meeting (the
"Meeting") of Stockholders of the Company. The Meeting will be held at 2:30
p.m., Wabash, Indiana time, on October 22, 1996, at the office of the Company
located at 1205 North Cass Street, Wabash, Indiana.
In addition to the election of directors, stockholders are being asked
to ratify the appointment of Crowe Chizek & Company LLP as the Company's
auditors. Accordingly, your Board of Directors unanimously recommends that you
vote for each of the proposals.
We encourage you to attend the Meeting in person. Whether or not you
plan to attend, however, please read the enclosed Proxy Statement and then
complete, sign and date the enclosed proxy and return it in the accompanying
postpaid return envelope as promptly as possible. This will save the Company
additional expense in soliciting proxies and will ensure that your shares are
represented at the Meeting.
Thank you for your attention to this important matter.
Very truly yours,
NICHOLAS M. GEORGE
President and Chief Executive Officer
FFW CORPORATION
1205 North Cass Street
Wabash, Indiana 46992
(219) 563-3185
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held on October 22, 1996
Notice is hereby given that an Annual Meeting of Stockholders (the
"Meeting") of FFW Corporation ("FFW" or the "Company") will be held at the
office of the Company located at 1205 North Cass Street, Wabash, Indiana, at
2:30 p.m. Wabash, Indiana time, on October 22, 1996.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. The election of three directors of the Company;
2. The ratification of the appointment of Crowe Chizek & Company LLP
as auditors for the Company for the fiscal year ended June 30,
1997;
and such other matters as may properly come before the Meeting, or any
adjournments thereof. The Board of Directors is not aware of any other business
to come before the Meeting.
Any action may be taken on the foregoing proposals at the Meeting on
the date specified above, or on any date or dates to which the Meeting may be
adjourned. Stockholders of record at the close of business on September 12,
1996, are the stockholders entitled to vote at the Meeting, and any adjournments
thereof.
You are requested to complete and sign the enclosed form of proxy which
is solicited on behalf of 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
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
Wayne W. Rees
Chairman of the Board and Secretary
Wabash, Indiana
September 25, 1996
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING.
A SELF-ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
NO POSTAGE IS REQUIRED IF MAILED WITHIN THE UNITED STATES.
PROXY STATEMENT
FFW CORPORATION
1205 North Cass Street
Wabash, Indiana 46992
(219) 563-3185
ANNUAL MEETING OF STOCKHOLDERS
October 22, 1996
This Proxy Statement is furnished in connection with the solicitation
on behalf of the Board of Directors of FFW Corporation ("FFW" or the "Company")
of proxies to be used at the Annual Meeting of Stockholders of the Company (the
"Meeting") which will be held at the office of the Company, located at 1205
North Cass Street, Wabash, Indiana, on October 22, 1996, at 2:30 p.m., Wabash,
Indiana time, and all adjournments of the Meeting. The accompanying Notice of
Meeting and this Proxy Statement are first being mailed to stockholders on or
about September 25, 1996. Certain of the information provided herein relates to
First Federal Savings Bank of Wabash ("First Federal" or the "Bank"), a wholly
owned subsidiary and predecessor of the Company.
At the Meeting, stockholders of the Company are being asked to consider
and vote upon the election of three directors of the Company and a proposal to
ratify the appointment of Crowe Chizek & Company LLP as the Company's auditors
for the fiscal year ending June 30, 1997.
Vote Required and Proxy Information
All shares of Company common stock ("Common Stock") represented at the
Meeting by properly executed proxies received prior to or at the Meeting, and
not revoked will be voted at the Meeting in accordance with the instructions
thereon. If no instructions are indicated, properly executed proxies will be
voted for the nominees and the adoption of the proposal set forth in this Proxy
Statement. The Company does not know of any matters, other than those described
in the Notice of the Meeting, that are to come before the Meeting. If any other
matters are properly presented at the Meeting for action, the persons named in
the enclosed form of proxy and acting thereunder will have the discretion to
vote on such matters in accordance with their best judgment.
Directors shall be elected by a plurality of the votes present in the
person or represented by proxy at the Meeting and entitled to vote on the
election of directors. In all matters other than the election of directors, the
affirmative vote of the majority of shares present in person or represented by
proxy at the Meeting and entitled to vote on the matter shall be the act of the
stockholders. Proxies marked to abstain with respect to a proposal have the same
effect as votes against the proposal. Broker non-votes have no effect on the
vote. One-third of the shares of the Company's Common Stock, present in person
or represented by proxy, shall constitute a quorum for purposes of the Meeting.
Abstentions and broker non-votes are counted for purposes of determining a
quorum.
A proxy given pursuant to the solicitation may be revoked at any time
before it is voted. Proxies may be revoked by: (i) filing with the Secretary of
the Company at or before the Meeting a written notice of revocation bearing a
later date than the proxy; (ii) duly executing a subsequent proxy relating to
the same shares and delivering it to the Secretary of the Company at or before
the Meeting; or (iii) attending the Meeting and voting in person (although
attendance at the Meeting will not in and of itself constitute revocation of a
proxy). Any written notice revoking a proxy should be delivered to Wayne W.
Rees, Secretary, FFW Corporation, 1205 North Cass Street, Wabash, Indiana 46992.
Voting Securities and Principal Holders Thereof
Stockholders of record as of the close of business on September 12,
1996, will be entitled to one vote for each share then held. As of that date,
the Company had 702,060 shares of Common Stock issued and outstanding. The
following table sets forth information regarding share ownership of: (i) those
persons or entities known by management to beneficially own more than five
percent of the Company's Common Stock and (ii) all directors and officers as a
group.
Shares
Beneficially Percent
Beneficial Owner Owned of Class
---------------- ----- --------
FFW Corporation, Inc. Employee Stock Ownership Plan 59,150 8.43%
1025 North Cass Street
Wabash, IN 46992-1027(1)
The Midwest Bank Fund II, L.P., Bank Fund III, L.P., Bank Fund IV, L.P., 62,011 8.83
Bank Fund III Trust and Bank Fund IV Trust (collectively, "the Funds")
208 S. LaSalle Street
Chicago, Illinois 60604(2)
Mr. and Mrs. Nicholas M. George(3) 55,494 7.90
633 Crown Hill Drive East
Wabash, IN 46992
Directors and executive officers of the Company and the Bank as a group 175,844 25.05
(9 persons)(4)
- - -----------------------
(1)The amount reported represents shares held by the Employee Stock Ownership
Plan ("ESOP"), 29,195 of which were allocated to accounts of participants.
Ronald J. Metz, the trustee of the ESOP, may be deemed to beneficially own
the shares held by the ESOP which have not been allocated to the accounts of
participants or shares which are not voted by participants.
(2)As reported in an amended Schedule 13D filed with the Securities and Exchange
Commission ("SEC") on or about August 2, 1996. The Midwest Bank Fund II,
L.P., Bank Fund III, L.P., the Bank Fund III Trust, the Bank Fund IV, L.P.
and the Bank Fund IV Trust reported sole voting and dispositive powers as to
8,718, 10,403, 31,890, 2,521, and 8,479 shares of Common Stock, respectively.
(3)As reported in an Amended Schedule 13D filed with the SEC on June 28, 1996.
Includes 9,882 shares held directly by Mr. George, 19,295 shares held
jointly, 1,999 shares held by Mrs. George, 1,000 shares held by Mr. George
and his son, 15,843 shares subject to options granted to Mr. George under the
1992 Stock Option Plan and Incentive Plan ("Stock Option Plan"), 2,628 shares
awarded under the Management Recognition Plan ("MRP") subject to restriction
and 4,847 shares allocated to Mr. George's account under the ESOP. Excludes
5,282 shares subject to options which are not exercisable within 60 days of
September 12, 1996.
(4)Includes shares held directly, as well as, jointly with family members, and
shares held in retirement accounts in a fiduciary capacity or by certain
family members, with respect to which shares the listed individuals or group
members may be deemed to have sole voting and investment power. This table
also includes 9,248 shares allocated to the accounts of officers under the
ESOP, 35,763 shares subject options granted under the Company's Stock Option
Plan, to directors and executive officers which were exercisable within 60
days of September 12, 1996 and 6,568 shares subject to restriction awarded to
directors and executive officers under the MRP. This table excludes 14,794
shares subject to options granted under the Stock Option Plan to directors
and executive officers which are not exercisable within 60 days of September
12, 1996.
I. ELECTION OF DIRECTORS
General
The Company's Board of Directors currently consists of seven members.
Each of the directors of the Company has served in such capacity since its
incorporation in December 1992. The Board is divided into three classes, each of
which contains approximately one-third of the Board. Approximately one-third of
the directors is elected annually. Directors of the Company are generally
elected to serve for a three-year period or until their respective successors
are elected and qualified.
The table below sets forth certain information, as of September 12,
1996, regarding the composition of the Company's Board of Directors, including
each director's term of office. The Board of Directors acting as the nominating
committee has recommended and approved the nominees identified in the following
table. It is intended that the proxies solicited on behalf of the Board of
Directors (other than proxies in which the vote is withheld as to a nominee)
will be voted at the Meeting FOR the election of the nominees identified below.
If a nominee is unable to serve, the shares represented by all valid proxies
will be voted for the election of such substitute nominee as the Board of
Directors may recommend. At this time, the Board of Directors knows of no reason
why any nominee may be unable to serve, if elected. Except as disclosed herein,
there are no arrangements or understandings between the nominee and any other
person pursuant to which the nominee was selected.
Shares of
Term Common Stock
Director to Beneficially Percent
Name Age(1) Position(s) Held in the Company Since(2) Expire Owned(3) of Class
---- ------ ------------------------------- -------- ------ -------- --------
NOMINEES
Nicholas M. George 49 President and Chief Executive Officer 1977 1999 55,494(4) 7.90%
J. Stanley Myers 49 Director 1985 1999 15,980 2.28
Thomas L. Frank 53 Director 1987 1999 16,680 2.38
DIRECTORS CONTINUING IN OFFICE
Wayne W. Rees 58 Chairman of the Board and Secretary 1983 1997 24,380 3.47
Ronald D. Reynolds 49 Director 1991 1997 9,405 1.34
Maynard E. Vollmer 68 Director 1969 1998 9,580 1.36
Joseph W. McSpadden 48 Director 1987 1998 9,380(5) 1.34
(1)At June 30, 1996.
(2)Includes service as a director of the Bank.
(3)Amounts include shares held directly and jointly with family members, as well
as, shares which are held in retirement accounts, or held by certain members
of the named individuals' families, or held by trusts of which the named
individual is a trustee or substantial beneficiary, with respect to which
shares the respective directors may be deemed to have sole or shared voting
and/or investment power. Amounts also include 3,168, 2,668, 1,584, 2,168,
1,056, 1,056 and 15,843 shares subject to options owned by Messrs. Myers,
Frank, Rees, Reynolds, Vollmer, McSpadden and George, respectively, under the
Stock Option Plan which are exercisable within 60 days of September 12, 1996
and an award of 303 and 2,628 shares of Common Stock granted to each
non-employee director and Mr. George, respectively, under the MRP, which are
subject to restriction. Amounts exclude 1,057 and 5,282 shares subject to
options granted to each non-employee director and Mr. George, respectively,
which are not exercisable within 60 days of September 12, 1996.
(4)See footnote 3 on page 2 for additional information regarding shares
beneficially owned by Mr. George.
(5)Excludes 1,000 shares of stock held by a corporation in which Mr. McSpadden
is a minority shareholder. Mr. McSpadden expressly disclaims beneficial
ownership with respect to such shares.
The principal occupation of each director of the Company is set forth
below. All directors have held their present position for at least five years
unless otherwise indicated.
Wayne W. Rees. Mr. Rees is the owner and publisher of The Paper of
Wabash County, Inc., a newspaper published in Wabash, Indiana. Mr. Rees has been
Chairman of the Board and Secretary of the Company since December 1992. Mr. Rees
has served as Chairman of the Bank's Board of Directors since July 1992.
Nicholas M. George. Mr. George is the President and Chief Executive
Officer of the Company, a position he has held since December 1992. Mr. George
is also President and Chief Executive Officer of First Federal, a position he
has held for the past 20 years. Mr. George joined First Federal as a vice
president in 1972 and was promoted to President in 1976. Mr. George has
responsibility for the overall management and establishment of First Federal's
objectives, policies, and strategic plans. He assists in the overall
administration of First Federal, including the implementation of and reporting
on policies and plans adopted by the Board of Directors. He also serves as
President and Director of FirstFed Financial of Wabash, Inc., the Company's
subsidiary, a position he has held since 1989.
Maynard E. Vollmer. Mr. Vollmer is retired and was the owner of
Maynard's Men Shop, a men's apparel shop formerly located in North Manchester,
Indiana.
Joseph W. McSpadden. Mr. McSpadden is the Vice President and part owner
of Beauchamp & McSpadden, an insurance agency located in Wabash, Indiana.
J. Stanley Myers. Mr. Myers is the owner and operator of ServiSoft
Water Conditioning, Inc., a soft water appliance company located in Wabash,
Indiana.
Thomas L. Frank. Mr. Frank is the Comptroller for B. Walter & Company,
a manufacturer of wood furniture and products located in Wabash, Indiana.
Ronald D. Reynolds. Mr. Reynolds is the owner of J. M. Reynolds Oil
Co., Inc., an oil supply company located in Wabash, Indiana.
Meetings and Committees of the Board of Directors
Meetings and Committees of the Company. Meetings of the Company's Board
of Directors are generally held on a monthly basis. The Board of Directors met
12 times during fiscal 1996. During fiscal 1996, no incumbent director of the
Company attended fewer than 75% of the aggregate of the total number of Board
meetings and the total number of meetings held by the committees of the Board of
Directors on which he served.
The Board of Directors of the Company has standing Executive, Audit,
Stock Option, Investment and Nominating Committees.
The Executive Committee is comprised of Directors Rees, McSpadden and
Vollmer. The Executive Committee meets on an as needed basis and exercises the
power of the Board of Directors between Board meetings. This Committee did not
meet during fiscal 1996.
The Audit Committee recommends independent auditors to the Board,
reviews the results of the auditors' services, reviews with management and the
internal auditors the systems of internal control and internal audit reports and
assures that the books and records of the Company are kept in accordance with
applicable accounting principles and standards. The members of the Audit
Committee are Directors George, Frank and Reynolds. During the fiscal year ended
June 30, 1996, this Committee met four times.
The Stock Option Committee is composed of Directors Frank, Reynolds and
Vollmer. This Committee is responsible for administering the Company's Stock
Option Plan and reviews compensation and benefit matters.
This Committee met one time during the fiscal year ended June 30, 1996.
The Investment Committee is comprised of Directors Frank, McSpadden and
George. This Committee is responsible for reviewing and approving the
investments of the Company, as well as setting investment strategies.
During fiscal 1996, this Committee met seven times.
The entire Board of Directors acts as a nominating committee for
selecting nominees for election as directors. While the Board of Directors of
the Company will consider nominees recommended by stockholders, the Board has
not actively solicited such nominations. Pursuant to the Company's Bylaws,
nominations by stockholders must be delivered in writing to the Secretary of the
Company at least 30 days before the date of the Meeting. This Committee met once
during the fiscal year ended June 30, 1996.
Meetings and Committees of the Bank. Meetings of the Bank's Board of
Directors are generally held on a monthly basis. The Board of Directors met 12
times during the fiscal year ended June 30, 1996. During fiscal 1995, no
incumbent director of the Bank attended fewer than 75% of the aggregate of the
total number of Board meetings and the total number of meetings held by the
committees of the Board of Directors on which he served.
The Board of Directors of the Bank has various committees, the
principal of which include Executive, Audit, Advertising, Personnel, Planning,
Investment, Building and Nominating Committees.
The Executive Committee of the Bank generally acts in lieu of the full
Board of Directors between board meetings. The Executive Committee also has
responsibility for oversight of the Bank's lending policies. This committee
consists of three outside directors. The members of this committee are Directors
Rees, McSpadden and Vollmer as of June 30, 1996. During the fiscal year ended
June 30, 1996, this committee met 12 times.
The Audit Committee of the Bank is composed of Directors George, Frank
and McSpadden. The Audit Committee meets on a quarterly basis to review budgets
and is responsible for reviewing the annual audit report and reporting to the
full Board of Directors. This committee also meets with the Bank's external
auditors prior to the annual audit to review audit procedures. This committee
met four times during the fiscal year ended June 30, 1996.
The Advertising Committee of the Bank is responsible for all
advertising, public relations and promotions of the Bank. Members of this
committee include Directors Rees, Vollmer and George. This committee meets at
least annually and on an as needed basis. The Advertising Committee met two
times during fiscal 1996.
The Personnel/Compensation Committee of the Bank establishes and
reviews compensation, bonuses, benefits and the personnel policies of the Bank.
The current members of this committee are Directors Vollmer, Frank and Reynolds.
This committee meets at least annually on an as needed basis. The committee met
one time during the fiscal year ended June 30, 1996.
The Planning Committee of the Bank is comprised of Directors Rees,
Myers and George and Chief Financial Officer Redman and Vice President Sanders.
This committee has authority to make recommendations to the Bank's Board of
Directors regarding changes to the Bank's strategic plan. This committee did not
meet during the fiscal year ended June 30, 1996.
The Investment Committee of the Bank meets quarterly to review and
approve investments of the Bank and set investment strategies. The members of
this committee are Directors Frank, McSpadden and George. This committee held
seven meetings during the fiscal year ended June 30, 1996.
The Building Committee comprised of Directors Myers, Reynolds and
George inspects all buildings and grounds owned by the Bank to ensure they are
being properly maintained. This committee also recommends and supervises
building projects, decorating projects and/or general maintenance programs.
Meetings of this committee are held on an as needed basis. The Building
Committee met two times during fiscal year ended June 30, 1996.
The Nominating Committee of the Bank is comprised of the entire board
of directors. The committee makes written nominations prior to the annual
meeting. This committee held one meeting during fiscal 1996.
Director Compensation
Cash Compensation. The Company's directors are paid a fee of $150 per
meeting attended for serving on the Company's Board of Directors. No fee is paid
for membership on the Company's committees. All present members of the Company's
Board of Directors are also members of the Bank's Board of Directors. All Bank
directors, other than the Chairman, receive a fee of $550 per meeting attended.
The Chairman of the Bank receives a fee of $650 per meeting attended. No fee is
paid to directors of the Bank for committee membership.
Deferred Compensation Plan ("DCP"). In 1986, the Bank adopted the DCP
for the benefit of its directors. The DCP is a voluntary deferred compensation
plan which permits directors of the Bank to defer receipt of all or a portion of
their regular board fees. This plan was established to hold and attract quality
directors by providing a retirement benefit in amounts related to Board fees
deferred annually. Under the DCP, a participant or his beneficiary, will receive
retirement payments (equal to the amount deferred plus interest accrued thereon)
payable in monthly installments upon retirement from the Board at age 70.
If the director's service on the Board ceases for any reason other than
death or disability, prior to age 70, amounts deferred pursuant to the DCP will
be held by the Bank until the director reaches age 70. In the event of death or
disability of the director while serving on the Bank's board, monthly or annual
payments will be made to the director or his designated beneficiary. In the
event of the director's death following retirement, the remaining benefits will
be paid to the designated beneficiary. These benefit payments are not subject to
any reduction for Social Security benefits or other offset amounts. Until
disbursed, the amounts due and payable under the DCPs continue to be assets of
the Bank, subject to the claims of general creditors. During fiscal 1996, no
directors were deferring compensation pursuant to the DCP.
Executive Compensation
The Company has not paid any compensation to its executive officers
since its formation. The Company does not presently anticipate paying any
compensation to such persons until it becomes actively involved in the operation
or acquisition of business other than the Bank and FirstFed Financial of Wabash,
Inc.
The following table sets forth information regarding compensation paid
by the Company and the Bank to their Chief Executive Officer for services
rendered during the fiscal year ended June 30, 1996. No other executive officer
made in excess of $100,000 during the fiscal year ended June 30, 1996.
SUMMARY COMPENSATION TABLE
Long-Term Compensation
Annual Compensation
Awards Payouts
Restricted
Other Annual Stock Options/ LTIP All Other
Salary Bonus Compensation Award(s) SARs Payouts Compensation
Name and Principal Position Year ($)(1) ($)(2) ($) ($) (#) ($) ($)(3)
- - ----------------------------------------------------------------------- ---------- ----------------------------------
Nicholas M. George, President 1996 $100,462 $17,880 $5,684
and Chief Executive Officer 1995 96,738 16,709 --- --- --- --- 4,264
1994 87,133 15,025 --- --- --- --- 3,949
=====================================================================================================================
- - -------------------------------
(1)Includes $8,038, $5,300 and $4,796 of compensation deferred pursuant to the
401(k) Plan and directors fees paid of $9,000, $8,400 and $7,200 for fiscal
1996, 1995 and 1994, respectively.
(2)Represents an annual cash bonus paid pursuant to the Bank's Incentive
Compensation Plan. The amount of the bonus depends on the achievement of
various performance criteria adopted from time-to-time for the Bank and its
employees.
(3)Includes the Bank's contributions of $4,019, $2,650 and $2,398 to Mr.
George's account under the 401(k) Plan and $1,665, $1,614 and $1,551 of
disability insurance premiums paid by the Bank during fiscal years 1996, 1995
and 1994, respectively.
The following table sets forth information regarding the number and
value of stock options at June 30, 1996 held by the Company's Chief Executive
Officer. No stock options were granted to or exercised by Mr. George during
fiscal 1996.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
Number of Unexercised Value of Unexercised In-the-Money
Shares Options/SARs at FY-End(#) Options/SARs at FY-End ($)
Acquired Value
Name on Exercise (#)Realized ($) Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ----------- --------------- ------------- ----------- -------------
Nicholas M. George N/A N/A 15,843 5,282(1) $146,548(2) $48,859(2)
===================================================================================================================
- - -------------------------------
(1) Represents an option to purchase Common Stock awarded to the Company's Chief
Executive Officer. Pursuant to the terms of the incentive stock option
award, options vest at a rate one-quarter of the initial award per year
commencing on April 1, 1994.
(2) Represents the aggregate market value (market price of the Common Stock less
the exercise price) of the option granted based upon the average of the bid
and asked price of $19.25 per share of the Common Stock as reported on the
Nasdaq system on June 30, 1996.
Employment Agreement and Salary Continuation Plan
On April 1, 1993, the Bank entered into an employment agreement with
Nicholas M. George for a three-year term. The employment agreement provides for
an annual base salary as determined by the Board of Directors, but not less than
Mr. George's then current salary of $73,500. Salary increases are reviewed not
less often than annually thereafter, and are subject to the sole discretion of
the Board of Directors. The employment contract provides for an automatic
extension for one additional year upon authorization by the Board of Directors
at the end of each year. The contract provides for termination upon the
employee's death, for cause or upon certain events specified by Office of Thrift
Supervision ("OTS") regulations. The employment contract is terminable by the
employee upon 90 days' notice to the Bank. The employment contract provides for
payment to the employee, in the event there is a change in control of the
Company or the Bank, as defined in such agreement, where employment terminates
involuntarily in connection with such change in control or within 12 months
thereafter, of the remaining salary payable under the contract, plus a
termination payment equal to 299% of Mr. George's highest salary in effect under
the employment contract at any time during the 12 months prior to the date of
termination, provided that total payments under the agreement may not exceed
three times the employee's annual salary or an amount that would cause certain
adverse tax consequences to the Bank and the employee under Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"). Assuming a change in
control were to take place as of June 30, 1996, the aggregate amounts payable to
Mr. George pursuant to this change in control provision would be approximately
$294,000. The contract contains a provision which prohibits Mr. George, for a
period of one year, from, directly or indirectly, owning, managing, operating or
controlling, or participating in the ownership, management, operation or control
of, or be employed by or connected in any manner with, any financial institution
having an office located within 20 miles of any office of the Bank at the date
of the employees' termination. The contract provides, among other things, for
participation in an equitable manner in employee benefits applicable to
executive personnel. This employment contract may have an "anti-takeover" effect
that could affect a proposed future acquisition of control of the Bank.
Effective October 1992, the Bank adopted a salary continuation plan for
the benefit of President George in order to encourage Mr. George's continued
employment with the Bank until November 1, 2011 (the "retirement date"). The
plan provides retirement and death benefits to Mr. George or his designated
beneficiary upon Mr. George's retirement, early retirement or death while
employed by the Bank, provided that Mr. George gives the Bank six months'
written notice of any early retirement. This cash benefit, as described in the
plan, is increased for each year Mr. George remains employed by the Bank.
Benefits provided for under the plan vest one year from the date of adoption of
the plan. The Bank has purchased an annuity to fund its obligations under this
plan.
In the event of Mr. George's retirement or death at June 30, 1996, the
amounts payable to Mr. George or his beneficiary pursuant to the plan would be
$64,984 and $389,161, respectively. Retirement or early retirement
payments pursuant to the plan would be made monthly or in a lump sum payment at
the option of Mr. George while death benefits would be made in a lump sum
payment.
In the event Mr. George voluntarily terminates his employment with the
Bank for any reason, other than death, early retirement or retirement, Mr.
George is entitled to receive only the vested portion of the retirement benefit
provided for in the plan. In the event Mr. George terminated his employment with
the Bank on June 30, 1996, $64,984 would be payable to Mr. George pursuant to
this provision.
Certain Transactions
The Bank, like many financial institutions, has followed a policy of
granting to officers, directors and employees loans secured by the borrower's
residence and consumer loans. All loans to the Bank's officers and directors are
made in the ordinary course of business and on the same terms, including
interest rate and collateral, and conditions as those of comparable transactions
prevailing at the time, and do not involve more than the normal risk of
collectibility or present other unfavorable features.
All loans by the Bank to its directors and executive officers are
subject to OTS regulations restricting loans and other transactions with
affiliated persons of the Bank. All loans from the Bank to its officers,
directors, key employees or their affiliates are approved or ratified by a
majority of the independent and disinterested members of the Bank's Board of
Directors. At June 30, 1996, the Bank's loans to directors, officers, employees
and members of their immediate families and affiliates totalled $1.3 million, or
8.3% of the Company's stockholders' equity.
Set forth below is certain information as to loans made by the Bank to
each of its directors and executive officers whose aggregate indebtedness to the
Bank exceeded $60,000 at any time since June 30, 1994. Each of the loans was
made in the ordinary course of business and did not involve more than the normal
risk of collectibility. Unless otherwise indicated, all loans designated as
residential loans are first mortgage loans secured by the borrower's principal
place of residence.
Largest Amount
Year of Outstanding Since Balance at
Name and Position Origination Type of Loan June 30, 1994 June 30, 1996
----------------- ----------- ------------ ------------- -------------
Wayne W. Rees 1988 Home Mortgage $ 95,566 $ 79,954
Chairman and Director 1994 Commercial 10,164 ---
1995 Commercial 17,000 5,912
1996 Commercial 8,000 6,743
J. Stanley Myers 1987 Home Mortgage 78,673 59,172
Director 1991 Commercial Real Estate 51,182 41,941
1992 Commercial 67,667 67,667
1993 Commercial 4,774 ---
1993 Savings Account 13,535 12,250
1994 Commercial 428 ---
1994 Commercial 12,483 12,483
Nicholas M. George 1995 Home Mortgage 260,000 115,000
President, Chief Executive Officer and
Director
II. RATIFICATION OF THE APPOINTMENT OF AUDITORS
The Board of Directors has renewed the Company's arrangement for Crowe
Chizek & Company LLP to be its auditors for the 1997 fiscal year, subject to the
ratification of the appointment by the Company's stockholders. A representative
of Crowe Chizek & Company LLP is expected to attend the Meeting to respond to
appropriate questions and will have an opportunity to make a statement if he so
desires.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF CROWE CHIZEK & COMPANY LLP AS THE COMPANY'S
AUDITORS FOR THE FISCAL YEAR ENDING JUNE 30, 1997.
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials
for the next Annual Meeting of Stockholders, any stockholder proposal to take
action at such meeting must be received at the Company's main office located at
1205 North Cass Street, Wabash, Indiana 46992, no later than May 29, 1997. Any
such proposal shall be subject to the requirements of the proxy rules adopted
under the Exchange Act.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matter should properly come before the Meeting, it is
intended that holders of the proxies will act in accordance with their best
judgment.
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. In addition to solicitation by mail,
directors, officers and regular employees of the Company and/or the Bank may
solicit proxies personally or by telegraph or telephone without additional
compensation.
Wabash, Indiana
September 25, 1996
REVOCABLE PROXY
FFW CORPORATION
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 22, 1996
The undersigned hereby appoints the Board of Directors of FFW Corporation (the
"Company"), and the survivor of them, with full powers of substitution, to act
as attorneys and proxies for the undersigned to vote all shares of common stock
of the Company which the undersigned is entitled to vote at the Annual Meeting
of Stockholders (the "Meeting"), to be held on October 22, 1996 at 2:30 p.m.,
and at any and all adjournments thereof, as indicated on this Proxy.
1. The election as directors of all nominees listed (except as marked to the
contrary below):
NICHOLAS M. GEORGE J. STANLEY MYERS THOMAS L. FRANK
[ ] For [ ] Withhold [ ] For All Except
INSTRUCTION: To withhold authority to vote for any individual nominee, mark "For
All Except" and write that nominee's name in the space provided below.
________________________________________________________________________________
2. The ratification of the appointment of Crowe Chizek & Company as auditors of
the Company for the fiscal year ending June 30, 1997.
[ ] For [ ] Against [ ] Abstain
In their discretion, the proxies are authorized to vote on such other matters
as may properly come before the Meeting or any adjournment thereof.
The Board of Directors recommends a vote "FOR" the listed proposals.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR THE PROPOSALS STATED. IF ANY OTHER BUSINESS IS
PRESENTED AT SUCH MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY
IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO
OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The stockholder acknowledges receipt from the Company, prior to the execution
of this Proxy, of Notice of the Meeting, a Proxy Statement dated September 25,
1996 and the Company's Annual Report to Stockholders for the fiscal year ending
June 30, 1996.
Please be sure to sign and date this Proxy in the box below.
__________________________________
Date
__________________________________
Stockholder sign above
__________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
FFW CORPORATION
Should the stockholder be present and elect to vote at the Meeting or at any
adjournment thereof, and after notification to the Secretary of the Company at
the Meeting of the stockholder's decision to terminate this Proxy, then the
power of such attorneys and proxies shall be deemed terminated and of no further
force and effect.
Please sign exactly as your name(s) appear(s) above on this card. When signing
as attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder should sign.
PLEASE PROMPTLY COMPLETE, DATE, SIGN AND MAIL
THIS PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE.