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 Commission Only (as permitted
by Rule 14a-6(e)((2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
AMBANC CORP.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other
than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-
6(i)(4) and 0-11.
1) Title of each class of securities to which transaction
applies:
_____________________________________________
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):
________________________________
4) Proposed maximum aggregate value of transaction:
________________________________________________
5) Total fee paid: ________________________________
[ ] 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: _________________
2) Form Schedule or Registration
Statement No.: _________________
3) Filing Party: _________________
4) Date Filed: _________________
1 DEFINITIVE PROXY SOLICITATION MATERIALS-
-INTENDED TO BE RELEASED 3/26/97 or
3/27/97
AMBANC CORP.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 18, 1997
The Annual Meeting of Shareholders of AMBANC Corp. will
be held in Fort Sackville rooms I-IV of the Isaac K. Beckes
Student Union at Vincennes University, 3rd Street and
College Avenue, Vincennes, Indiana, on Friday, April 18,
1997, at 10:30 a.m., Vincennes time, for the following
purposes:
1. To elect six Directors to hold office until the
Annual Meeting of Shareholders in the year 2000 and
until their successors are elected and have
qualified.
2. To transact such other business as may properly come
before the Annual Meeting.
Holders of Common Shares of record at the close of
business on March 11, 1997, are entitled to notice of and to
vote at the Annual Meeting.
SHAREHOLDERS ARE INVITED TO ATTEND THE MEETING IN
PERSON. ALL SHAREHOLDERS, EVEN IF THEY PLAN TO ATTEND THE
MEETING, ARE REQUESTED TO COMPLETE, SIGN AND DATE THE
ACCOMPANYING PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES.
By Order of the Board
of Directors
Richard E. Welling
Secretary
March 25, 1997
Vincennes, Indiana
(ANNUAL REPORT ENCLOSED)
2
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS OF
AMBANC CORP.
April 18, 1997
This Proxy Statement is being furnished to shareholders
on or about March 25, 1997, in connection with the
solicitation by the Board of Directors of AMBANC Corp. (the
"Corporation"), 302 Main Street, Vincennes, Indiana 47591,
of proxies to be voted at the Annual Meeting of Shareholders
to be held at 10:30 a.m., Vincennes time, on April 18, 1997,
in Fort Sackville rooms I-IV of the Isaac K. Beckes Student
Union at Vincennes University, 3rd Street and College
Avenue, Vincennes, Indiana. The Corporation is the parent
holding company for AmBank Indiana, N.A. (formerly The
American National Bank of Vincennes and Citizens' National
Bank of Linton prior to their merger in 1996), AmBank
Illinois, N.A. (formerly The First National Bank in
Robinson), and AmBank Illinois (formerly Bank of Casey)
(referred to collectively herein as the "Banks").
At the close of business on March 11, 1997, the record
date for the Annual Meeting, there were 3,316,003 Common
Shares outstanding and entitled to vote at the Annual
Meeting. On all matters, including the election of
Directors, each shareholder will have one vote for each
share held.
If the enclosed form of proxy is executed and returned,
it may nevertheless be revoked at any time insofar as it has
not been exercised. The proxy may be revoked by either (a)
filing with the Secretary (or other officer or agent of the
Corporation authorized to tabulate votes) (i) an instrument
revoking the proxy or (ii) a subsequently dated proxy, or
(b) attending the Annual Meeting and voting in person.
Unless revoked, the proxy will be voted at the Annual
Meeting in accordance with the instructions of the
shareholder as indicated on the proxy. If no instructions
are given, the shares will be voted as recommended by the
Directors.
ELECTION OF DIRECTORS
Nominees
The following information is provided for the Directors
of the Corporation, including the six nominees for election
to the Corporation's Board of Directors at the Annual
Meeting. The Board of Directors of the
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Corporation currently consists of fifteen members. The
members of the Board of Directors are divided into three
classes of near-equal size with the term of one class
expiring each year. Generally, the members of each class
serve until the Annual Meeting of the shareholders held in
the year that is three years after the Directors' election
and thereafter until such Directors' successors are elected
and have qualified.
The terms of the current Directors expire as follows:
1997 -- Ms. Kaley and Messrs. Brocksmith, Hippensteel,
Niehaus, Weber and Wright; 1998 -- Messrs. Seed, Stachura,
Summers and Watson; and 1999 -- Ms. Ernst and Messrs. Apple,
Green, Helmling, and Landrith. Paul E. Brocksmith, Gerry M.
Hippensteel, Rebecca A. Kaley, Bernard G. Niehaus, Frank J.
Weber and Howard R. Wright have been nominated for re-
election at the Annual Meeting, each to hold office until
the Annual Meeting of Shareholders to be held in the year
2000 and until each of their successors is elected and has
qualified. Each Director will be elected by a plurality of
the votes cast in the election. Shares present but not
voted for any nominees will not affect the determination of
whether a nominee has received a plurality of the votes
cast.
It is the intention of the persons named in the
accompanying form of proxy to vote such proxy in favor of
the election to the Board of Directors of Paul E.
Brocksmith, Gerry M. Hippensteel, Rebecca A. Kaley, Bernard
G. Niehaus, Frank J. Weber and Howard R. Wright. Each such
person has indicated that he or she will accept nomination
and election as a Director. If, however, any such person is
unable or unwilling to accept nomination or election, it is
the intention of the Board of Directors to nominate such
other person as it may in its discretion determine, in which
event the shares subject to the proxy will be voted for that
person.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR
THE SIX NOMINEES IDENTIFIED ABOVE. (ITEM 1 ON THE PROXY).
The following table presents certain information
regarding the Directors of the Corporation, including the
six nominees proposed by the Board of Directors for election
at the Annual Meeting. Unless otherwise indicated in a
footnote, the principal occupation of each Director has been
the same for the last five years and such Director possesses
sole voting and investment powers with respect to the shares
indicated as beneficially owned by such Director. Unless
specified otherwise, a Director is deemed to share voting
and investment powers over shares indicated as held by a
spouse, children or
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other family members residing with the Director. Of the
Directors, only Ms. Kaley and Messrs. Landrith and Weber,
who beneficially own approximately 4.0 percent, 1.2 percent,
and 1.9 percent of the Corporation's Common Shares,
respectively, beneficially own more than 1.0 percent of the
Corporation's Common Shares. The Corporation's management
knows of no person, including any group, who owns more than
five percent of the Corporation's Common Stock. A total of
380,669 of the Corporation's Common Shares, representing
11.4 percent, are beneficially owned by the Directors and
executive officers of the Corporation.
Name, Age, and Shares Beneficially
Present Principal Director Owned on January 1,
Occupation Since (1) 1997
GLEN G. APPLE 1982 7,025 (2)
65
Farmer
PAUL E. BROCKSMITH* 1979 6,744 (4)
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Retired (3)
CHRISTINA M. ERNST 1995 6,459 (5)
47
President, Miller Construction
Company, Inc. (power line
construction)
ROBERT D. GREEN 1978 18,048 (7)
52
President of RD
Services, Inc. (health care) (6)
ROLLAND L. HELMLING 1986 5,397 (8)
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President and Director of
Harold's Supermarkets, Inc.,
Helmling Realty Corp., and
Andretti-Helmling Automotive
Corp. (retail auto parts)
GERRY M. HIPPENSTEEL, M.D.* 1984 1,648
50
Physician
REBECCA A. KALEY* 1996 132,144 (9)
62
Attorney
OWEN M. LANDRITH 1993 41,127 (11)
70
Secretary/Treasurer,
Palestine Development Corp.
(community development) (10)
BERNARD G. NIEHAUS* 1977 8,142
59
President and Director,
Niehaus Lumber Co., Inc.
(building materials)
ROBERT E. SEED 1994 15,716 (12)
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Vice President of the Corporation;
President, AmBank Illinois, N.A.;
Chairman of the Board, President
and C.E.O. of AmBank Illinois
JOHN A. STACHURA, JR. 1988 18,546 (13)
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Vice President/General Manager,
Solar Sources Underground, LLC
(coal mining)
PHILLIP M. SUMMERS 1982 2,946 (14)
57
President,
Vincennes University
ROBERT G. WATSON 1982 28,572 (15)
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Chairman of the Board,
President and Chief
Executive Officer of the
Corporation and
AmBank Indiana, N.A.
FRANK J. WEBER* 1996 64,199 (16)
52
Attorney
HOWARD R. WRIGHT* 1973 7,977 (18)
68
Retired (17)
All Directors and all 380,669 (19)
executive officers as a group
consisting of 23 persons
_____________________________
*Nominee
1. Includes service as a Director of AmBank Indiana,
N.A., prior to the adoption of the holding company
structure in 1982.
2. Includes 1,012 shares owned by Mr. Apple's wife.
3. Prior to his retirement in 1993, Mr. Brocksmith was
a veterinarian and farmer.
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4. Includes 2,293 shares jointly owned by
Mr. Brocksmith and his wife; 1,934 shares jointly owned
by Mr. Brocksmith and his daughter; and 708 shares
owned by a company controlled by Mr. Brocksmith and his
son.
5. Includes 1,019 shares jointly owned by Ms. Ernst
and her husband; 4,853 shares owned by Miller
Construction Co., Inc.; and 105 shares owned by Ms.
Ernst's daughter.
6. Prior to becoming President of RD Services, Inc. in
1993, Mr. Green served as President of Green
Construction of Indiana, Inc.
7. Includes 3,529 shares jointly owned by Mr. Green
and his wife, and 3,486 shares owned by Mr. Green's
wife.
8. Includes 816 shares jointly owned by Mr. Helmling
and his wife, and 885 shares held by Mr. Helmling as
custodian for his three daughters.
9. Includes 108,440 shares held by the estate of Ms.
Kaley's father, for which estate Ms. Kaley serves as
executor; 5,945 shares held by Ms. Kaley's step-mother;
2,440 shares held by Mrs. Kaley's children; 894 shares
held by Ms. Kaley's son-in-law; and 110 shares held by
Ms. Kaley's grandchildren.
10. Mr. Landrith served as Chairman of the Board of
Directors of Farmers' State Bank of Palestine
("Farmers'") prior to the merger of Farmers' into
AmBank Illinois, N.A., effective November 1, 1995.
Prior to his resignation on December 31, 1994,
Mr. Landrith had served as President and Trust Officer
of Farmers'.
11. Includes 19,685 shares jointly owned by Mr.
Landrith and his wife.
12. Includes 1,494 shares owned by Mr. Seed's wife.
13. Includes 16,891 shares jointly owned by Mr.
Stachura and his wife, and 348 shares owned by Mr.
Stachura's wife.
14. Includes 2,254 shares jointly owned by Mr. Summers
and his wife.
15. Includes 19,845 shares that Mr. Watson may acquire
upon the exercise of stock options.
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16. Includes 11,655 shares held by Mr. Weber's wife;
20,663 shares held by Mr. Weber's sons; 4,600 shares
held by trusts for which Mr. Weber serves as trustee;
and
6,755 shares held by the law firm in which Mr. Weber is
a partner.
17. Prior to his retirement in 1992, Mr. Wright served
as a consultant for Cargill, Inc.
18. Includes 1,774 shares owned by Mr. Wright's wife,
and 4,539 shares held in the Wright Family Trust for
which Mr. Wright serves as trustee.
19. Includes 231,704 shares owned by or with spouses
and others. Also includes 19,845 shares that
Mr. Watson may acquire upon the exercise of stock
options and 6,615 shares that Mr. Raymond Mott, Senior
Vice President of AmBank Indiana, N.A., may acquire
upon the exercise of stock options.
Committees and Attendance
The Board of Directors of the Corporation held
five meetings during 1996. The Board of Directors of
the Corporation has an Executive Committee and an
Examining Committee. The Executive Committee reviews
on a monthly basis the overall operation and planning
for the Corporation and the Banks. The duties and
responsibilities of the Executive Committee include
strategic planning; capital structure, capital
financing and mergers and acquisitions; nominations and
shareholder relation matters; bank holding company
regulatory compliance; compensation; and legal matters.
The members of the Executive Committee are Paul E.
Brocksmith, Robert D. Green, Bernard G. Niehaus, John
A. Stachura, Jr., and Howard R. Wright. Robert G.
Watson serves as an ex officio member. Mr. Watson does
not receive any additional compensation for service on
the Executive Committee and does not participate in any
discussions or decisions relating to executive
compensation. The Executive Committee met nine times
in 1996.
The Examining Committee is responsible for
establishing suitable audits and examinations of the
affairs of the Corporation and the Banks by the
internal audit staff and a qualified independent
accounting firm. The members of the Examining
Committee are Robert D. Green, Rolland L. Helmling,
Gerry M. Hippensteel, John A. Stachura, Jr. and Frank
8
J. Weber. Messrs. Watson and Seed serve as ex officio
members; they do not receive any additional
compensation for their service. The Examining
Committee met seven times during 1996. The Board of
Directors of the Corporation does not have a nominating
committee or a compensation committee; instead, these
functions are performed by the Executive Committee.
Compensation of Directors
In 1996 the AMBANC Corp. Director Stock Grant Plan
(the "Director Plan") was adopted by the Board of
Directors and approved by the shareholders. Pursuant
to the Director Plan, each Director of the Corporation
receives a quarterly grant of Common Shares in lieu of
an annual cash retainer and cash Board meeting
attendance fees. For service on the Corporation's
Board during 1996, each Director received a quarterly
grant of that number of Common Shares having a value of
$1,250 as of the end of the quarter. Committee fees
and fees for service on the Banks' Boards of Directors
continue to be paid in cash. Each Director who was a
member of the Executive Committee of the Corporation's
Board of Directors, other than Directors who were
officers of the Corporation, received $500 for each
meeting of the Executive Committee attended and $300
for each meeting of the Examining Committee attended.
During 1996, Messrs. Apple, Brocksmith, Helmling, Seed,
Stachura, Watson and Wright also served on the Board of
Directors of one of the Banks. The Banks paid Director
fees in the amount of $6,000 for service for the full
year.
EXECUTIVE COMPENSATION
The following table sets forth certain summary
information regarding the compensation paid by the
Corporation or its subsidiaries to or on behalf of the
Corporation's Chief Executive Officer and the three
most highly compensated executive officers for services
rendered during each of the last three fiscal years (to
the extent applicable):
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SUMMARY COMPENSATION TABLE
Annual Compensation
Name and
Principal Position Year Salary ($) Bonus ($) Compensation
Robert G. Watson, 1996 $235,000 Pending (1) $29,726 (2)
President and C.E.O. of 1995 $235,000 $50,000 $24,361
the Corporation and 1994 $215,000 $40,000 $24,396
AmBank Indiana, N.A.
Robert E. Seed, 1996 $101,000 Pending (1) $25,742 (3)
Vice President of the 1995 N/A N/A N/A
Corporation; President 1994 N/A N/A N/A
and C.E.O. of AmBank
llinois; President of
AmBank Illinois, N.A.
David A. Musgrave, 1996 $143,823 $0 $24,151 (5)
President, AmBank 1995 N/A N/A N/A
Illinois, N.A. (4) 1994 N/A N/A N/A
Dan J. Robinson, 1996 $96,755 Pending (1) $14,920 (6)
Executive Vice President, 1995 N/A N/A N/A
AmBank Indiana, N.A. 1994 N/A N/A N/A
1. Bonus amounts for 1996 have not yet been
determined.
2. Represents matching contributions in the amount of
$18,726 under the AMBANC Retirement and Savings
Plan (the "401(k) Plan") and Director fees in cash
and grants of Common Shares having a total value
of $11,000.
3. Represents matching contributions in the amount of
$14,242 under the 401(k) Plan and Director fees in
cash and grants of Common Shares having a total
value of $11,500.
4. Mr. Musgrave resigned as President of AmBank
Illinois, N.A., in November 1996.
5. Represents matching contributions under the 401(k)
Plan in the amount of $18,651 and Director fees in
the amount of $5,500.
6. Represents matching contributions under the 401(k)
Plan in the amount of $13,120 and Director fees in
the amount of $1,800.
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Employment Agreement
In 1985, the Corporation and Robert G. Watson, who
is Chairman of the Board, President, and Chief
Executive Officer and a Director of the Corporation and
AmBank Indiana, N.A., entered into an employment
agreement that becomes operative only upon a Change in
Control of the Corporation or AmBank Indiana, N.A., as
defined by the agreement. A Change in Control is
deemed to have occurred for purposes of the agreement
if, following a tender offer, merger, consolidation,
sale of assets, or contested election of Directors, the
persons who previously were Directors no longer
constitute a majority. Under this agreement, the
Corporation agrees to employ Mr. Watson in his current
capacity for specified compensation (but in no event
for less than $10,000 per month) and benefits for a
period of three years commencing on the date the
agreement becomes operative. Following a Change of
Control, should the Corporation terminate the
employment of Mr. Watson for reasons other than cause,
death, or disability or should Mr. Watson resign as a
result of a diminishment of his status, functions,
duties, or responsibilities, the employment agreement
provides for various severance benefits to be paid to
Mr. Watson on a monthly basis over the balance of the
three-year employment period. These benefits include
monthly payments equal to one-twelfth of Mr. Watson's
annual base salary at its highest rate during the
twelve months preceding his termination date, the
continuation of his participation under all incentive
and employee welfare benefit plans, and a pension
supplement compensating Mr. Watson for any reduction in
pension benefits caused by the premature termination.
The monthly payments that would have been paid to
Mr. Watson over the next three years if a Change in
Control and termination of Mr. Watson's employment had
occurred on December 31, 1996, would have totalled in
the aggregate $761,178.
Supplemental Retirement Benefits Agreement
On June 20, 1989, the Corporation and AmBank
Indiana, N.A., entered into a Supplemental Retirement
Benefits Agreement with Mr. Watson (the "Agreement").
At a meeting held on February 16, 1995, the members of
the Executive Committee who are not officers of the
Corporation reviewed Mr. Watson's compensation. In
view of Mr. Watson's contributions to the growth and
the profitability of the Corporation, they decided to
recommend to the Corporation's Board of Directors that
the Agreement be amended to increase the amount of
benefits payable to Mr. Watson. The Corporation's
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Board of Directors approved the recommendation of the
Executive Committee, and the Corporation, AmBank
Indiana, N.A., and Mr. Watson entered into an Amended
and Restated Supplemental Retirement Benefits
Agreement, which became effective on March 31, 1995
(the "Amended Agreement"). The Amended Agreement
provides for the future payment to Mr. Watson of
retirement benefits in the event his employment with
both the Corporation and AmBank Indiana, N.A., is
terminated for any reason other than because of his
death. The retirement benefit payable to Mr. Watson
under the Amended Agreement is a monthly annuity
payable for his lifetime or for 180 months, whichever
is longer, in an amount of $1,948 plus the product
obtained by multiplying $87.52 by the number of months
Mr. Watson is employed by either the Corporation or
AmBank Indiana, N.A., between March 16, 1995, and
April 1, 2000 (the "Base Amount"). If Mr. Watson's
employment with the Corporation had terminated on
December 31, 1996, the monthly amount that Mr. Watson
would have been entitled to receive commencing on or
after January 1, 1997, would have been $3,786.
Pursuant to the Amended Agreement, when Mr. Watson's
employment terminates, the amount of the annuity
payments will be adjusted to reflect the amount of
employer contributions made to Mr. Watson's 401(k) plan
account as of that time.
AGGREGATED OPTION/SAR EXERCISES IN
LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES
The following table sets forth information with
respect to options and stock appreciation rights
("SARs") that have been granted to Mr. Watson pursuant
to the Corporation's Nonqualified Stock Option Plan,
which expired during 1993. There were no exercises of
options or SARs by Mr. Watson during 1996. (1)
Number of Unexercised Value of Unexercised
Options/SARs at Fiscal In-the-Money Options/SARs
at
Year-End (#) Fiscal Year End ($)
Exercisable/Unexercisable
Exercisable/Unexercisable
Robert G. Watson 19,845 options (2)/0 $205,594 (3)/0
19,845 SARs (2)/0 $102,797 (3)/0
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1. All references to numbers of shares and SARs
and exercise prices have been adjusted to
reflect the December 1996 five percent stock
dividend.
2. In 1988 Mr. Watson was granted options to
purchase 19,845 Common Shares at an exercise
price of $18.14 per share and in 1989 he was
granted 19,845 SARs at a base price of $18.14
each. All of the options and SARs are
exercisable. Each SAR entitles Mr. Watson to
50 percent of the appreciation in the value
of one Common Share over the base price of
the SAR at the time of exercise.
3. Represents the difference between the last
trade price of the Corporation's Common
Shares as reported on NASDAQ on December 31,
1996 ($28.50), and the exercise price of the
options and the base price of the SARs,
respectively.
REPORT ON EXECUTIVE COMPENSATION
Under rules established by the Securities and
Exchange Commission (the "SEC"), the Corporation is
required to provide certain data and information
regarding the compensation and benefits provided to the
Corporation's Chief Executive Officer. The members of
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the Executive Committee who are non-employee members of
the Board of Directors (the "Committee") have
responsibility for the Corporation's compensation
policies and practices. The Committee recommends
compensation amounts for executive officers of the
Corporation to the Board of Directors for final
approval. In fulfillment of its SEC disclosure
requirements, the Committee has provided the following
report for inclusion in this Proxy Statement.
COMPENSATION POLICY
The goal of the Corporation's executive
compensation policy is to ensure that an appropriate
relationship exists between executive pay and
performance, while at the same time providing
compensation that will attract and retain superior
talent. More specifically, the executive compensation
program of the Corporation has been designed to:
13
Reflect a pay-for-performance policy that links
compensation amounts to Corporation, subsidiary
and individual performance;
Motivate executive officers to achieve strategic
business goals and reward them for their
achievement; and
Provide compensation opportunities that are
competitive with those offered by other high-
performing peer companies, thus ensuring that the
Corporation is able to compete for and retain
talented executives who are critical to the
Corporation's long-term success.
At present, the executive compensation program is
composed of salary, potential annual cash incentives,
and other benefits typically offered to executives of
similar companies. As an executive's level of
responsibility increases, a greater portion of the
executive's potential total compensation opportunity is
based on performance incentives, causing greater
variability in the individual's total compensation
level from year-to-year. The Committee considers a
number of criteria and factors in determining
compensation, as discussed below, but the Committee has
not assigned any specific weights to those criteria and
factors.
SALARIES
Base salaries for executive officers generally are
determined based on consideration of competitive salary
data provided by outside consultants using relevant
survey data for financial institutions, internal
comparability considerations, and individual
performance. Base salaries are not automatically
adjusted each year.
In October 1994, the Corporation's Board of
Directors held a strategic planning meeting at which
the Board reviewed and discussed in detail the
Corporation's performance and the contributions of the
Corporation's employees, including those of Mr. Watson,
the Corporation's Chief Executive Officer. In light of
the determinations made by the Board, the Committee
undertook a comprehensive review of the compensation
received by the Chief Executive Officer. The Chairman
of the Committee, together with the Corporation's
financial, accounting and legal advisors and after
reviewing a number of compensation surveys and other
data, prepared a report on the compensation received by
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chief executive officers of bank holding companies
located in the Midwest and comparable to the
Corporation in asset and deposit size, rate of growth,
profitability, and other factors. The Committee
reviewed the report and, at a special meeting held on
February 16, 1995, made recommendations for future
increases in Mr. Watson's base salary that would
compensate Mr. Watson not only for his service and
performance in the current year but also recognize his
contributions to the growth and profitability of the
Corporation since his assumption of leadership in 1982.
The Board of Directors approved the Committee's
recommendations with respect to Mr. Watson's
compensation. Based on the recommendations of the
Committee, which the Board approved, Mr. Watson's base
salary for 1996 was set at $235,000.
BONUS AWARDS
Bonuses are awarded to the Corporation's CEO and
other executive officers on the basis of an assessment
of the following factors:
The Corporation's performance as reflected by
acquisition activity, growth, return on assets,
return on equity and total return to the
shareholders as reflected in the shareholder
return performance graph appearing in this Proxy
Statement;
The performance of the executive, along with
relevant business unit or subsidiary performance;
and
A review of competitive data on incentive
compensation for peer companies provided by
outside consultants.
The Committee has not yet determined bonus amounts for
1996.
LONG-TERM INCENTIVES
In 1988 the Corporation's shareholders approved
the adoption of a Stock Option Plan having a five-year
term. Stock options were granted to Mr. Watson and
another executive officer in 1988 and stock
appreciation rights ("SARs") were granted to Mr. Watson
and another executive officer in 1989. No other grants
were made pursuant to the Stock Option Plan prior to
its expiration in April 1993. If, in the future, the
Committee determines that incentives in the form of
15
stock options, SARs or other awards would be in the
Corporation's best interest, the Committee may seek
corporate and shareholder approval of an appropriate
long-term incentive plan.
TAX ACT COMPENSATION LIMITS
In 1993 the Internal Revenue Code of 1986 was
amended to limit, unless certain conditions are
satisfied, to $1 million the deduction that a publicly
held corporation may take with respect to the
compensation paid to certain highly paid executive
officers. The Committee has not taken any action to
recommend changes in the Corporation's compensation
policies in response to this change in the
deductibility cap because the base salaries and
incentive bonuses awarded to the Corporation's
executives are substantially less than the cap amount.
SUBMITTED BY THE MEMBERS OF THE EXECUTIVE COMMITTEE WHO
RECOMMEND EXECUTIVE COMPENSATION:
Howard R. Wright, Chairman Bernard G. Niehaus
Paul E. Brocksmith John A. Stachura,
Jr.
Robert D. Green
STOCK PERFORMANCE GRAPH
The SEC requires the Corporation to include in
this proxy statement a line-graph presentation
comparing the Corporation's cumulative, five-year
shareholder returns with market and industry returns.
The following graph compares the performance of the
Corporation's Common Shares with the performance of the
NASDAQ Stock Market --
U.S. Companies and NASDAQ -- Bank Stocks.
16
[TABLE SUBSTITUTED FOR GRAPH]
Comparison of Five-Year Cumulative Total Return
AMBANC Corp., NASDAQ - Bank Stocks and NASDAQ-U.S.
Companies
Index 1991 1992 1993 1994 1995 1996
AMBANC Corp. 100 179 213 184 195 211
NASDAQ-Bank Stocks 100 146 166 165 246 326
NASDAQ-U.S. Companies 100 116 134 131 185 227
The graph assumes $100 was invested on December
31, 1991, in AMBANC Corp.'s Common Stock and in each of
the two indexes shown and the reinvestment of all
dividends.
CERTAIN TRANSACTIONS
The Corporation, through the Banks, has had, and
expects to have in the future, banking transactions in
the ordinary course of its business with Directors and
officers of the Corporation and their associates.
These transactions have been made on substantially the
same terms, including interest rates, collateral and
repayment terms on extensions of credit, as those
prevailing at the same time for comparable transactions
with others and did not involve more than the normal
risk of collectibility or present other unfavorable
features.
APPOINTMENT OF AUDITORS
Deloitte & Touche LLP ("Deloitte & Touche") served
as the independent auditors for the Corporation and the
Banks for 1996 and has been selected to serve for 1997.
Representatives from Deloitte & Touche are expected to
be present at the Annual Meeting and they will have the
opportunity to make a statement if they desire to do so
and will be available to respond to appropriate
questions.
17
OTHER MATTERS
The Board of Directors knows of no matters, other
than those matters reported above, that are to be
brought before the meeting. If other matters properly
come before the meeting, however, it is the intention
of the persons named in the enclosed form of proxy to
vote such proxy in accordance with their judgment on
such matters.
EXPENSES
All expenses in connection with this solicitation
of proxies will be borne by the Corporation.
SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
A shareholder desiring to submit a proposal for
inclusion in the Corporation's proxy statement for the
1998 Annual Meeting of Shareholders must deliver the
proposal so that it is received by the Corporation no
later than November 25, 1997. Proposals should be sent
to Secretary, AMBANC Corp., P.O. Box 556, Vincennes,
Indiana 47591-0556, and mailed by certified mail,
return receipt requested.
16
THE CORPORATION WILL PROVIDE WITHOUT CHARGE TO
EACH SHAREHOLDER, ON WRITTEN REQUEST, A COPY OF THE
CORPORATION'S ANNUAL REPORT ON FORM 10-K FOR 1996,
INCLUDING THE FINANCIAL STATEMENTS THERETO BUT OMITTING
EXHIBITS. REQUESTS SHOULD BE ADDRESSED TO INVESTOR
RELATIONS DEPARTMENT, AMBANC CORP., P.O. BOX 556,
VINCENNES, INDIANA 47591-0556.
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS FOR THE 1997 ANNUAL MEETING OF SHAREHOLDERS
OF AMBANC CORP.
I hereby appoint Bruce A. Smith and Gregory W.
Sturm, and each of them, my proxies, with power of
substitution and revocation, to vote all shares of
stock of AMBANC Corp. (the "Corporation") that I am
entitled to vote at the Annual Meeting of Shareholders
to be held in Fort Sackville rooms I-IV of the Isaac K.
Beckes Student Union at Vincennes University, 3rd
Street and College Avenue, Vincennes, Indiana, on
Friday, April 18, 1997, at 10:30 a.m., Vincennes time,
and any adjournments thereof, as provided herein:
1. ELECTION OF DIRECTORS
[ ] FOR all nominees listed below to serve
until the Annual Meeting of Shareholders
in the year 2000 as set forth in the
Proxy Statement dated March 21, 1997
(except as marked to the contrary below-
-see "Instructions"):
Paul E. Brocksmith
Gerry M. Hippensteel
Rebecca A. Kaley
Bernard G. Niehaus
Frank J. Weber
Howard R. Wright
[ ] WITHHOLD AUTHORITY to vote for all
nominees listed above
(Instructions: To withhold authority to vote for
any nominee, write that nominee's name in the
space provided below.)
____________________________________________
(To Be Completed on Reverse Side)
2. In their discretion, the proxies are
authorized to vote upon such other business
as may properly come before the meeting.
THIS PROXY WILL BE VOTED AS SPECIFIED. IN THE
ABSENCE OF SPECIFICATIONS, THIS PROXY WILL BE VOTED FOR
ITEM 1. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
ITEM 1.
SHAREHOLDERS SHOULD MARK, SIGN AND DATE THIS PROXY
AND RETURN IT PROMPTLY IN THE ENCLOSED POST-PAID
ENVELOPE. THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR
TO ITS EXERCISE.
Dated: __________________________
__________________________________
Signature or Signatures (Please sign exactly as your
name appears on this proxy. If shares are issued in
the name of two or more persons, all such persons
should sign. Trustees, executors and others signing in
a representative capacity should indicate the capacity
in which they sign.)