SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ X ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14A-11(c) or ss. 240.14a-12
First Financial Bancorp.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
First Financial Bancorp.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than Registrant)
<PAGE>
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Item 22(a)(2) of Schedule 14A.
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<PAGE>
FIRST FINANCIAL BANCORP.
300 High Street
P.O. Box 476
Hamilton, Ohio 45012-0476
NOTICE OF ANNUAL MEETING
OF
SHAREHOLDERS
To Be Held April 22, 1997
Hamilton, Ohio
March 14, 1997
To the Shareholders:
The Annual Meeting of Shareholders of First Financial Bancorp. (the
"Corporation") will be held at the Fitton Center for Creative Arts, 101 South
Monument Avenue, Hamilton, Ohio 45011, on April 22, 1997, at 2:00 P.M., local
time, for the following purposes:
1. To elect the following seven Directors: six Directors for
terms expiring in 2000 (Class II) as successors to the class
of Directors whose terms expire in 1997: Messrs. Richard L.
Alderson, James C. Garland, Murph Knapke, Stanley N. Pontius,
Barry S. Porter and Perry D. Thatcher; and one Director for a
term expiring in 1999 (Class I) as an additional director to
that class: Steven C. Posey.
2. To consider and act upon an amendment to the Corporation's
Articles of Incorporation, as amended, to increase the number
of authorized common shares.
3. To consider and act upon a proposed amendment to the
Company's Regulations to amend and restate the Regulations in
their entirety.
4. To consider and act upon, in their discretion, such other
matters as may properly come before the meeting or any
adjournment thereof.
On March 7, 1997, there were __________ common shares outstanding. Each
shareholder is entitled to one vote for each common share held regarding each
matter properly brought before the meeting. Holders of record of the Corporation
at the close of business on March 7, 1997, are entitled to notice of and to vote
at the Annual Meeting and at any adjournment thereof.
By Order of the Board of Directors,
Michael R. O'Dell, Senior Vice President,
Chief Financial Officer, and Secretary
EVERY SHAREHOLDER'S VOTE IS IMPORTANT. IF YOU ARE UNABLE TO BE PRESENT AT THE
ANNUAL MEETING, YOU ARE REQUESTED TO COMPLETE AND RETURN PROMPTLY THE ENCLOSED
PROXY SO THAT YOUR SHARES WILL BE REPRESENTED. A STAMPED, ADDRESSED ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE.
<PAGE>
FIRST FINANCIAL BANCORP.
300 High Street
P.O. Box 476
Hamilton, Ohio 45012-0476
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
Approximate Date to Mail - March 14, 1997
On behalf of the Board of Directors of First Financial Bancorp. (the
"Corporation"), a proxy is solicited from you to be used at the Corporation's
Annual Meeting of Shareholders ("Annual Meeting") scheduled for April 22, 1997,
at 2:00 P.M., local time, to be held at the Fitton Center for Creative Arts, 101
South Monument Avenue, Hamilton, Ohio 45011.
Proxies in the form enclosed herewith are being solicited on behalf of
the Corporation's Board of Directors. Proxies which are properly executed and
returned will be voted at the Annual Meeting as directed; proxies properly
executed and returned which indicate no direction will be voted in favor of the
proposals set forth in the Notice of Annual Meeting attached hereto and more
fully described in this Proxy Statement. Proxies indicating an abstention from
voting on any matter will be tabulated as a vote withheld on such matter and
will be included in computing the number of common shares present for purposes
of determining the presence of a quorum for the Annual Meeting. If a broker
indicates on the form of proxy that it does not have discretionary authority as
to certain common shares to vote on a particular matter, those common shares
will be considered as present but not entitled to vote with respect to that
matter. Any shareholder giving the enclosed proxy has the power to revoke the
same prior to its exercise by filing with the Secretary of the Corporation a
written revocation or duly executed proxy bearing a later date, or by giving
notice of revocation in open meeting.
VOTING SECURITIES
As of March 7, 1997, the record date fixed for the determination of
shareholders entitled to vote at the Annual Meeting, there were __________
common shares outstanding, which is the only outstanding class of capital stock
of the Corporation. Each such share is entitled to one vote on each matter
properly coming before the Annual Meeting.
PRINCIPAL SHAREHOLDERS
As of March 1, 1997, First National Bank of Southwestern Ohio,
Hamilton, Ohio, and other subsidiary banks, as Trustees, held in trust 3,065,489
shares, amounting to 20.8% of the outstanding common shares of the Corporation,
which shares are held by them in their fiduciary capacity under various
agreements with them as Trustees. The Trustees have advised the Corporation that
they have sole voting power for 2,608,858 shares, shared voting power for
__________ shares, sole investment power for 1,370,097 shares, and shared
investment power for 1,012,857 shares. The Trustees hold 445,272 common shares
under trust arrangements for certain directors and executive officers, and their
respective spouses or minor children, which common shares are also reported in
the following table showing share ownership of directors and executive officers.
Cincinnati Financial Corporation, 6200 South Gilmore Road, Cincinnati, Ohio
45214, is the owner of 680,744 shares, amounting to 4.6% of the outstanding
common shares of the Corporation. In addition, the Ohio Casualty
<PAGE>
Insurance Company, 136 North Third Street, Hamilton, Ohio 45025, a subsidiary of
Ohio Casualty Corporation, is the owner of 621,843 shares, amounting to 4.2% of
the outstanding common shares of the Corporation. The Board of Directors has no
knowledge of any person who owned of record or beneficially more than 5% of the
outstanding common shares of the Corporation.
SHAREHOLDINGS OF DIRECTORS, EXECUTIVE OFFICERS,
AND NOMINEES FOR DIRECTOR
As of March 1, 1997, the directors of the Corporation, including the
seven persons intended by the Board of Directors to be nominated for election as
directors, the executive officers of the Corporation named in the Summary
Compensation Table who are not also directors and all executive officers and
directors of the Corporation as a group beneficially owned common shares of the
Corporation as set forth below.
<TABLE>
<CAPTION>
Amount and Nature
of Beneficial Ownership Percentage
Name of Common Shares (1) of Class (15)
---- ----------------------- -------------
<S> <C> <C>
Richard L. Alderson 243
Arthur W. Bidwell 43,524 (2)
Thomas C. Blake 58,724 (3)
Donald M. Cisle 171,020 (4) ___%
Carl R. Fiora 8,227 (5)
Richard J. Fitton 269,309 ___%
Vaden Fitton 181,921 (6) ___%
James C. Garland 137
F. Elden Houts 15,073 (7)
Murph Knapke 7,717
Charles T. Koehler 92,316 (8)
Barry J. Levey 82,732
Stephen S. Marcum 27,939 (9)
Lauren N. Patch 2,342 (10)
Stanley N. Pontius 27,486
Barry S. Porter 5,811 (11)
Steven C. Posey 3,620 (12)
Joel H. Schmidt 29,971 (13)
Perry D. Thatcher 1,000
James J. Ashburn 31,344 (14)
Rick L. Blossom 15,638
Michael R. O'Dell 16,006
Michael T. Riley 13,452
All Executive Officers, Directors, and
Nominees as a group
(23 persons) 1,105,552 ____%
- -------------------
</TABLE>
(1) Includes shares subject to outstanding options under the 1991 Stock
Incentive Plan which are exercisable by such individuals within 60
days.
(2) Of these, 808 shares are owned by Mr. Bidwell's wife for which he
disclaims beneficial ownership.
<PAGE>
(3) Of these, 12,222 shares are owned by BSS Realty, and 21,221 shares are
owned by Mr. Blake's wife, for which Mr. Blake disclaims beneficial
ownership.
(4) Seward-Murph Inc., a corporation of which Mr. Cisle owns 40% of the
outstanding voting power and his father, Don S. Cisle, Jr., owns 60% of
the outstanding voting power, owns 163,625 common shares of the
Corporation. Mr. Cisle disclaims beneficial ownership of these shares.
(5) Of these, 1,080 shares are owned by Mr. Fiora's wife, for which he
disclaims beneficial ownership.
(6) Of these, 7,332 shares are owned by Mr. Fitton's wife, for which he
disclaims beneficial ownership.
(7) Of these, 389 shares are owned by Mr. Houts' wife, for which he
disclaims beneficial ownership.
(8) Of these, 40,040 shares are owned by Mr. Koehler's wife, for which he
disclaims beneficial ownership.
(9) Of these, 1,998 shares are owned by Mr. Marcum's wife and 5,612 shares
are owned by their children, for which he disclaims beneficial
ownership. The shares do not include common shares held by Ohio
Casualty Corporation of which Mr. Marcum is a director. Mr. Marcum
disclaims beneficial ownership of those shares.
(10) Does not include common shares held by Ohio Casualty Corporation of
which Mr. Patch is the President and Chief Executive Officer. Mr. Patch
disclaims beneficial ownership of those shares.
(11) Of these, 46 shares are owned by Mr. Porter's son, for which he
disclaims beneficial ownership. Does not include common shares held by
Ohio Casualty Corporation of which Mr. Porter is Chief Financial
Officer. Mr. Porter disclaims beneficial ownership of those shares.
(12) Of these, 1,650 are owned by Mr. Posey's minor children, for which he
disclaims beneficial ownership.
(13) Of these, 8,258 shares are owned by Mr. Schmidt's wife, for which he
disclaims beneficial ownership.
(14) As of January 31, 1997, Mr. Ashburn retired as an executive officer of
the Corporation.
(15) Percentages of class are listed only for those owning in excess of one
(1%) percent.
<PAGE>
ELECTION OF DIRECTORS
(Item I on Proxy Card)
The Board of Directors intends to nominate six persons as Class II
Directors each for a three-year term and one person as a Class I Director for
the remaining two years of a three-year term. Richard J. Fitton, Chairman of the
Corporation and a director of the Corporation since 1965, and Joel H. Schmidt, a
director of the Corporation since 1990, are not standing for re-election
pursuant to the Corporation's policy that directors are not eligible for
re-election after attaining age 70. The terms of the remaining directors in
Classes I and III will continue as indicated below. It is intended that the
accompanying proxy will be voted for the election of those six persons named
under Class II in the following table and for Mr. Posey named under Class I in
the following table. In the event that any one or more of such nominees
unexpectedly becomes unavailable for re-election, the accompanying proxy will be
voted in accordance with the best judgment of the proxy holders, including a
possible substitute nominee. The six nominees for Class II Directors receiving
the most votes at the Annual Meeting will be elected as Class II Directors and
the one nominee for Class I Directors receiving the most votes will be elected a
Class I director.
<TABLE>
<CAPTION>
Position with Company and/or
Principal Occupation or Employment Director
Name and Age (1) For the Last Five Years Since (2)
---------------- ----------------------------------------- ---------
<S> <C> <C>
Nominees
Class II Directors
Term Expiring in 2000:
Richard L. Alderson, Real Estate Investment and
48 Development; Director of Glove
Specialties Inc. (glove retailer); Former
Trustee of Union Township, Butler
County, Ohio.
James C. Garland, President of Miami University, Oxford, 1996
54 Ohio; President of RAZR Technology (a
consulting business).
Murph Knapke, Owner of Knapke Law Office, Celina, 1983
49 Ohio; Director of The Citizens
Commercial Bank & Trust Company,
Celina, Ohio.
Stanley N. Pontius, President and Chief Executive Officer of 1991
50 First Financial Bancorp.; President and
Chief Executive Officer and Director of
First National Bank of Southwestern
Ohio, Hamilton, Ohio; formerly
President and Chief Executive Officer
of Bank One, Mansfield, Ohio; held
various other positions at Bank One
Corporation for a period of 20 years.
<PAGE>
<CAPTION>
<S> <C> <C>
Barry S. Porter, Chief Financial Officer/Treasurer of 1988
59 Ohio Casualty Corporation (insurance
holding company) and its affiliated
companies; Director of First National
Bank of Southwestern Ohio, Hamilton,
Ohio.
Perry D.Thatcher, President and Chief Executive Officer of
66 Ample Industries, (manufacturer of
products/machines for the paper
industry).
Class III Directors
Term Expiring in 1998:
Thomas C. Blake, President of BSS Realty (real estate 1973
69 company); Director of First National
Bank of Southwestern Ohio, Hamilton,
Ohio.
F. Elden Houts, Chairman, Director and retired Chief 1983
65 Executive Officer of The Citizens
Commercial Bank & Trust Company,
Celina, Ohio.
Charles T. Koehler, Retired Director and Chairman of the 1971
70 Board of Hamilton Brass & Aluminum
Castings Company; President and
Treasurer of Miami-Cast Corp. (makers
of cast brass and aluminum moldings);
Director of First National Bank of
Southwestern Ohio, Hamilton, Ohio.
Lauren N. Patch, President, Chief Executive Officer and 1995
45 Director of Ohio Casualty Corporation
(insurance holding company) and its
affiliated companies.
Donald M. Cisle, President of Don S. Cisle Contractor, 1996
42 Inc. (construction contractor) since
1989.
Class I Directors
Term Expiring in 1999:
Arthur W. Bidwell, President and Chief Executive Officer 1990
68 of Magnode Corp. (maker of
aluminum extrusions), Trenton, Ohio;
Director of First National Bank of
Southwestern Ohio, Hamilton, Ohio.
<PAGE>
<CAPTION>
<S> <C> <C>
Carl R. Fiora, Retired President and Chief Executive 1987
62 Officer of Armco Steel Co., L.P.;
formerly Area Vice President,
Manufacturing and Services Group,
Armco Inc.; entire business career was
with Armco Inc. (diversified steel and
energy company); Director of First
National Bank of Southwestern Ohio,
Hamilton, Ohio.
Vaden Fitton, (3) Retired First Vice President of the 1965
67 First National Bank and Trust
Company of Hamilton, Hamilton, Ohio;
Director of Ohio Casualty Corporation
and First National Bank of Southwestern
Ohio, Hamilton, Ohio.
Barry J. Levey, Retired partner of the law firm of 1985
66 Frost & Jacobs, LLP, Middletown,
Ohio; Director of First National Bank
of Southwestern Ohio, Hamilton,
Ohio. Retired State Senator.
Stephen S. Marcum, Partner in Parrish, Fryman & Marcum 1996
39 Co., LPA; Director of Ohio Casualty
Corporation (insurance holding company).
Nominee
Steven C. Posey, President - Posey Management Corp.
46 DBA McDonald's; President - Posey
Property Company.
(1) Ages are listed as of December 31, 1996.
(2) Messrs. Blake, Fitton and Koehler are listed at the earlier of their
service with the predecessor entities (First National Bank of
Southwestern Ohio, The First National Bank and Trust Company of
Hamilton, or First National Bank of Middletown).
(3) Vaden Fitton and Richard J. Fitton are cousins.
</TABLE>
<PAGE>
PROPOSAL TO AMEND THE ARTICLES OF INCORPORATION TO INCREASE
THE NUMBER OF AUTHORIZED SHARES
(Item II on Proxy Card)
The Board of Directors has proposed the adoption of an amendment to the
Articles of Incorporation, as amended that would increase the authorized number
of Common Shares, par value $8.00 per share, of the Corporation from 25,000,000
shares to 60,000,000 shares. The Board proposes that the first paragraph of
Article Fourth of the Company's Articles of Incorporation be amended to read as
follows:
FOURTH: The total number of shares which the corporation is authorized
to issue is 60 Million common shares, par value $8.00 per share.
On the Record Date, of the 25,000,000 authorized common shares, ______
common shares were issued and outstanding, __________ common shares were
unissued and not reserved for issuance, and _________ common shares were
unissued and reserved for issuance.
The Board of Directors believes that it is desirable and in the best
interests of the Corporation and its shareholders that there be a substantial
number of authorized but unissued common shares in order to assure flexibility
of action in the future. The Board also believes that an increase in the number
of common shares is necessary in order that a sufficient number of shares is
available for issuance from time to time if needed for such corporate purposes
as may be deemed appropriate by the Board. These purposes may include, for
example, using the shares as consideration in the acquisition of other banks and
savings and loan companies, the issuance of shares under the Corporation's
employee benefit plans or shareholder rights plan or general corporate purposes.
The issuance of any additional common shares could have the effect of diluting
the ownership of existing shareholders.
Such additional authorized common shares could be issued as a defensive
measure in connection with a takeover attempt for the Corporation opposed by the
incumbent Board of Directors, and could be utilized in a manner which might have
the effect of making the acquisition of control of the Corporation more
difficult. For example, issuing additional common shares could have the effect
of diluting the ownership of persons seeking to obtain control of the
Corporation.
The proposed amendment to the Articles of Incorporation is not being
recommended in response to any specific effort of which the Corporation is aware
to obtain control of the Corporation nor does the Board of Directors have any
present intent to use the additional common shares to impede a takeover attempt
except pursuant to the terms of its rights plan.
The Corporation has no present intent to issue any of the additional
common shares which will be authorized by the adoption of the amendment to
Article Fourth. Moreover, there are no pending negotiations, discussions,
obligations, agreements or understandings which would involve the issuance of
any common shares, other than those negotiations and discussions regarding the
Corporation's possible acquisition of community banks which occur, from time to
time, in the course of the Corporation's business. The additional common shares
for which authorization is sought will have the same rights and privileges as
the common shares now authorized.
<PAGE>
If the amendment is approved by the requisite vote, the Board will have
the authority to issue the additional authorized shares or any part thereof from
time to time to such persons and for such consideration as the Board of
Directors may determine, without necessarily requiring further action by the
shareholders.
Recommendation.
The Board of Directors recommends a vote FOR this proposal. Adoption of
this proposal requires the affirmative vote of two-thirds of the issued and
outstanding shares of the Corporation. Accordingly, abstentions and broker
non-votes will have the effect of a vote against the proposed amendment.
Effect of Management Vote on Proposal.
In as much as the directors and executive officers of the Corporation
own beneficially ____ common shares, or ___% of the outstanding voting power,
their votes on the proposal are not likely to have a material impact on whether
this proposal is adopted.
<PAGE>
PROPOSAL TO AMEND REGULATIONS
(Item III On Proxy Card)
General
The Board of Directors is recommending several amendments to the Corporation's
governing Regulations (the "Regulations"). The Regulations provide generally for
the governance of the Corporation in accordance with the General Corporation Law
of Ohio. In the judgment of the Board, the Regulations require further amendment
at this time to reflect the current provisions of the Ohio General Corporation
Law and to conform to certain changes in the manner in which the Corporation
conducts its business. A copy of the proposed Amended and Restated Regulations
are attached as Appendix A for your information. Provisions of the Regulations
that are being deleted are in brackets and provisions that are being added to
the Regulations are indicated in "bold type."
Article I - Meetings of Shareholders
Section 1.1 - Annual Meeting. Section 1.1 presently provides that if, from any
cause, an election of directors is not made on the date set for the annual
meeting of the shareholders for the election of directors, the Board of
Directors shall order the election to be held on some subsequent date and that
notice of such meeting be given in the manner provided for the annual meeting.
Under the current laws and procedures, the notice that the Corporation gives for
the annual meeting requires an extensive amount of time and expense for its
preparation and mailing. The Ohio law provides that notice of adjournment of a
meeting need not be given if the time and place to which the meeting is
adjourned are fixed and announced at the meeting which is being adjourned.
Therefore, the Board of Directors believes that it is advisable to allow notice
of an adjournment of a meeting to be given as provided by the Ohio law. To
effect this change, the Board of Directors recommends that Section 1.1 of
Article I be amended by deleting the last sentence of such Section.
Section 1.2 - Special Meetings. Section 1.2 presently provides for the calling
of special meetings of the shareholders. Section 1.2 does not reflect the
current provisions of Ohio law, and the Board of Directors believes that it is
advisable to revise such Section to accurately reflect the provisions of the
statute. Therefore, the Board of Directors recommends that Section 1.2 of
Article I be amended to read as set forth in Appendix A hereto.
Section 1.3 - Quorum. Section 1.3 presently defines a quorum but is silent and
not clear about the shareholder vote required to take particular actions as set
forth in the Ohio law, the Corporation's Articles of Incorporation or these
Regulations. Therefore, to clarify this ambiguity, the Board of Directors
recommends that Section 1.3 of Article I be amended to read as set forth in
Appendix A hereto.
Article II - Directors
Section 2.1 - Nomination. The present Section 2.1 concerning the procedures and
information required to nominate directors of the Corporation is outdated and
does not conform to existing Federal securities law requirements. In addition,
the present Section 2.1 does not provide sufficient advance notice of certain
actions to allow the Corporation to comply with such legal requirements.
Therefore, it is proposed to amend Section 2.1 to require that any shareholder
intending to nominate director candidates for election must deliver written
notice to the Secretary of the Corporation (i) not later than 90 days prior to
the date one year from the date of the immediately preceding annual meeting of
<PAGE>
shareholders with respect to an election to be held at an annual meeting of
shareholders, and (ii) not later than the close of business on the tenth day
following the date on which notice of the special meeting of shareholders for
the election of directors is first given to shareholders. In addition, any
written notice of nomination of director candidates given by a shareholder must
now contain the information set forth in the proposed Section 2.1. Therefore, to
effectuate these changes, the Board of Directors recommends that Section 2.1 be
amended to read as set forth in Appendix A hereto.
Section 2.2 - Number. Section 2.2 provides that the number of directors of the
Corporation, which shall not be less than nine or more than 25, shall be 15
until increased or decreased at any time by the affirmative vote of two-thirds
of the whole authorized number of directors or at a meeting of the shareholders
called for the purpose of electing directors at which a quorum is present by the
affirmative vote of the holders of a majority of the shares which are
represented at the meeting and entitled to vote on the proposal. As a result of
this language, there is the possibility that the affirmative vote of a majority
of the shares at a meeting at which a quorum is present, although less than a
majority of or two-thirds of the outstanding voting power of the corporation,
could change the number of directors of the Corporation. Therefore, a minority
of the shareholders could force a change that the majority of the shareholders
might not otherwise approve. For this reason, the Board is recommending that, in
addition to the Board's existing authority to set the number of directors, the
number of directors of the Corporation can only be changed by the affirmative
vote of the holders of at least two-thirds of the outstanding voting power of
the Corporation voting as a single class. Thus, a substantial portion of the
outstanding voting power of the Corporation will be required to change the
number of directors on a shareholder's initiative.
In addition, Section 2.2 is being amended to eliminate the specific language
allowing removal of a director for cause and defining cause as a court finding a
director guilty of a felony or as a director breaching his fiduciary duty under
the laws of Ohio. These sentences do not appear to conform with the Ohio law
and, therefore, the Board of Directors is recommending that the sentences be
removed. To effect these changes, the Board of Directors recommends that Section
2.2 of Article II be amended as set forth in Appendix A hereto.
Section 2.4 - Meetings. The Board of Directors is recommending that the one day
notice of director meetings presently set forth in Section 2.4 be changed to two
day's notice to conform to the current Ohio law.
Section 2.7 - Executive Committee. The Board of Directors is proposing that the
title of Section 2.7 be changed from "Executive Committee" to "Committees" since
the subject matter of the Section deals with the Executive Committee as well
other committees that the Board may appoint. In addition, to conform to current
Ohio law, the Board of Directors is recommending that the phrase at the end of
the first sentence "except to the extent prohibited by the laws of the State of
Ohio" be replaced by "other than that of filling vacancies among the directors
or any committee of the directors" and that the reference in the last sentence
to "The Chairman of the Board of Directors or in his absence, the President", be
replaced by "The Board of Directors".
<PAGE>
Article III-A - Indemnification and Insurance
Indemnification
The Board of Directors recommends that Article III-A be renumbered to Article IV
and that the heading be changed to "Indemnification" rather than
"Indemnification and Insurance" because the Article as proposed deals with
indemnification only. The present Article generally repeats the provisions of
the Ohio law authorizing indemnification by the Corporation. The purpose of the
present Article has been to allow the Corporation to indemnify its officers and
directors and others to the full extent permitted by Ohio law. However, in
operation, the present Article does not achieve this purpose. For example, if
the Ohio law were to change in between annual meetings of shareholders to allow
greater indemnification of officers and directors by the Corporation, the
officers and directors of the Corporation would not be entitled to such expanded
indemnification until shareholders approved an amendment to the Regulations.
Therefore, to avoid this potential difficulty and to allow the officers and
directors of the Corporation to be indemnified to the full extent permitted by
the Ohio law without the need for the Corporation's Regulations to be amended
every time the Ohio law changes, the Board of Directors recommends that Article
III-A be amended to delete the present Article III-A and replace it with the
proposed Article IV as set forth in Appendix A hereto, which provides that the
Corporation shall indemnify all persons whom it may indemnify to the full extent
permitted by Ohio law.
Article V - Corporate Seal
Section 5.1 - Corporate Seal. Section 5.1 presently states that the
Corporation's seal will be in the "following form" and then neglects to set
forth the form of such seal. Therefore, the Board of Directors recommends, that
the last sentence of Section 5.1 be omitted and replaced by the last sentence of
Section 6.1 as set forth Appendix A hereto, which provides that the seal shall
be in such form as the Board may determine.
Article VII - Code of Regulations
Article Heading. The Board of Directors recommends that the Article heading be
changed from "Code of Regulations" to "Amendment, Alteration or Repeal" to more
accurately reflect the subject matter of the Article.
Section 7.2 - Amendments. Section 7.2 presently provides that the Regulations
may be amended, altered, repealed or replaced by an affirmative vote of a
majority of shares empowered to vote thereon at any regular or special meeting
of shareholders. Under this provision, a majority of a quorum present at a
meeting could amend the Regulations although this majority of a quorum was less
than a majority of the outstanding voting power of the Corporation. Therefore,
the Board of Directors is recommending that the Regulations be amended, altered,
repealed or replaced only by the affirmative vote of at least two-thirds of the
outstanding voting power of the Corporation voting as a single class at a
meeting of shareholders called for such purpose, unless such amendment,
alteration, repeal or replacement is recommended by the affirmative vote of
two-thirds of the whole authorized number of directors, in which case the
Regulations may be amended, altered, repealed or replaced by the affirmative
vote of the holders of a majority of the outstanding voting power of the
Corporation voting as a single class at a meeting of shareholders held for such
purpose. To effect this change, the Board of Directors recommends that Section
7.2 of Article VII of the Regulations be amended to read as set forth in
Appendix A hereto.
<PAGE>
General. The Board of Directors also recommends that the Code of Regulations be
amended throughout to replace "Code of Regulations" with "Amended and Restated
Regulations" because the Ohio law no longer refers to "Code of Regulations" but
uses the term "Regulations" and the version in Appendix A are "amended and
restated" Regulations. In addition, as a result of numbering Article III-A as
Article IV, the numbering of all subsequent Articles has been increased by one.
Although it might be argued that certain sections of the Amended and Restated
Regulations, such as Sections 2.2 and 8.2, are being proposed as and have
anti-takeover implications, and thereby might make it more difficult for the
Corporation to be acquired in a transaction not approved by the Board of
Directors, the Board wants to emphasize and reiterate that the basic purpose of
the proposed Amended and Restated Regulations is to bring them into compliance
with the present Ohio law, to allow them to accurately reflect the manner in
which the Corporation operates as well as to make certain that a minority of the
shareholders cannot force changes that do not reflect the will of at least a
majority of the outstanding shares.
The Board of Directors recommends a vote FOR this proposal. Adoption of this
proposal requires the affirmative vote of a majority of the shares empowered to
vote thereon at the annual meeting of shareholders. Accordingly, abstentions
from voting will have the effect of a vote against the proposed amendments and
broker non-votes will have no effect on the outcome of the vote.
Effect of Management Vote on Proposal. In as much as the directors and executive
officers of the Corporation own beneficially ______ common shares, or ____% of
the outstanding voting power, their votes on the proposal are not likely to have
a material impact on whether this proposal is adopted.
<PAGE>
MEETINGS OF THE BOARD OF DIRECTORS
AND COMMITTEES OF THE BOARD
During the last fiscal year, the Board of Directors held five regularly
scheduled meetings and two special meetings. All of the incumbent directors and
each nominee standing for re-election attended 75% or more of those meetings and
the meetings held during the fiscal year by all board committees on which he
served except Barry J. Levey.
Each director received $5,000 as a retainer and $500 per meeting as
director of the Corporation. Each non-employee director is paid $250 for each
committee meeting attended. Pursuant to the 1991 Stock Incentive Plan, each
non-employee director receives in the year in which he is re-elected to the
Board of Directors an option to purchase 2,217 common shares. The exercise price
for each option granted is 100% of the fair market value on the date of grant.
The Board of Directors has a standing Audit Committee, Executive
Committee and a Compensation Committee. The Executive Committee acts as the
Nominating Committee for the Board.
The Audit Committee makes recommendations to the Board of Directors
concerning the selection and engagement of the Corporation's independent
auditors and reviews with them the scope and status of the audit, the fees for
services performed by the firm, and the results of the completed audit. The
Committee also reviews and discusses with the internal audit department,
management and the Board of Directors, such matters as accounting policies,
internal controls and procedures for preparation of financial statements. The
members of the Audit Committee are Thomas C. Blake, Donald M. Cisle, Carl R.
Fiora, Richard J. Fitton, Vaden Fitton, Lauren N. Patch, Barry S. Porter and
Joel H. Schmidt. The Audit Committee held six meetings during the fiscal year.
The Executive Committee, in the recess of the Board, has the authority
to call a meeting to act upon most corporate matters subject to Board approval.
The Committee acts as the Nominating Committee and makes recommendations to the
Board regarding nominees for election as directors of the Corporation. The
members of the Executive Committee are Arthur W. Bidwell, Thomas C. Blake,
Richard J. Fitton, Vaden Fitton, Charles T. Koehler, Barry J. Levey and Stanley
N. Pontius. The Executive Committee held one meeting during the fiscal year.
The Compensation Committee makes recommendations to the Board of
Directors with respect to the compensation of the executive officers of the
Corporation and all benefit plans of the Corporation. The members of the
Compensation Committee are Arthur W. Bidwell, Thomas C. Blake, Richard J.
Fitton, Vaden Fitton, Charles T. Koehler, Barry J. Levey and Barry S. Porter.
The Compensation Committee held three meetings during the fiscal year.
The accounting firm of Ernst & Young LLP has served as independent
public auditors for the Corporation and its subsidiaries during the past year.
Management expects that representatives of that firm will be present at the
Annual Meeting, will have the opportunity to make a statement, if they desire to
do so, and will be available to respond to appropriate questions.
The Corporation's financial statements for the previous fiscal year
were audited by Ernst & Young LLP. In connection with the audit function, Ernst
& Young LLP also reviewed the Corporation's report on Form 10-K and other
filings with the Securities and Exchange Commission. Ernst & Young LLP also
completed retrospective reviews of the Corporation's quarterly reports on Form
10-Q.
<PAGE>
EXECUTIVE COMPENSATION
The following Summary Compensation Table sets forth the compensation
paid during the last three completed fiscal years by the Corporation and its
subsidiaries to (1) the Chief Executive Officer, and (2) each of the four most
highly compensated executive officers of the Corporation whose total salary and
bonus annually exceed $100,000 for services in all capacities for the
Corporation:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term Compensation
----------------------------------------
Annual Compensation Awards Payouts
------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other Restricted Securities All Other
Annual Stock Underlying LTIP Compen-
Name and Salary Bonus Compensation Award(s) Options/ Payouts sation
Principal Position Year ($) ($) ($) ($) SARs(#)(2) ($) ($) (3)
------------------ ---- --- --- --- --- ---------- --- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stanley N. Pontius ............... 1996 $297,142 $ 93,718 0 34,750(4) 1,100 0 $ 4,457
President and Chief Executive 1995 268,004 84,365 0 33,250(4) 0 0 4,500
Officer (1) ...................... 1994 253,841 73,581 0 0 5,500 0 4,500
Rick L. Blossom ................. 1996 153,829 45,535 0 17,375 1,100 0 4,378
Senior Vice President and ........ 1995 132,133 32,656 0 0 0 0 3,814
Chief Lending Officer ............ 1994 122,574 27,238 0 0 2,577 0 3,629
James J. Ashburn ................. 1996 154,100 35,370 0 0 1,100 0 4,402
Senior Vice President ............ 1995 146,268 33,527 0 0 0 0 4,246
1994 135,069 32,897 0 0 2,577 0 4,042
Michael R. O'Dell ................ 1996 102,893 23,500 0 17,375 1,100 0 2,990
Senior Vice President, ........... 1995 90,001 23,150 0 0 1,650 0 2,691
Chief Financial Officer .......... 1994 79,934 20,795 0 0 1,375 0 2,388
and Secretary
Michael T. Riley ................. 1996 98,349 23,077 0 17,375 1,100 0 2,938
Senior Vice President ............ 1995 88,763 22,744 0 0 0 0 2,651
1994 84,431 19,952 0 0 1,375 0 2,530
(1) Mr. Pontius' salary for 1996 includes his salary as President and Chief
Executive Officer of the Corporation and President and Chief Executive
Officer of First National Bank of Southwestern Ohio.
(2) Adjusted for stock dividends.
(3) Represents the Corporation's contribution to the Thrift Plan.
(4) In each of January 1995 and January 1996, respectively, Mr. Pontius
received a restricted stock award of 1,000 common shares, all shares of
which will vest on the fifth anniversary of the date of the award.
Dividends will be paid on the restricted stock. In January 1996, Mr.
Pontius also received a stock option of 1,100 (adjusted for stock divident
on November 1, 1996) common shares.
</TABLE>
<PAGE>
The following table shows all individual grants of stock options to the named
executive officers of the Corporation during the fiscal year ended December 31,
1996.
<TABLE>
<CAPTION>
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
Potential
Realizable
Value (Gain) at
Assumed Annual
Rates of
Stock Price
Individual Grants Appreciation for
Option Term (1)
- ----------------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g)
Number of
Securities % of Total Exercise
Underlying Options Granted or Base
Options/SARs to Employees in Price (2)(3) Expiration 5% 10%
Name Granted (3) Fiscal Year ($/Sh) Date $51.46 $81.94
---- ------------ ------------- -------- ------------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Stanley N. Pontius 1,100 3.6% 31.59 2006 $21,857 $55,385
Rick L. Blossom 1,100 3.6% 31.59 2006 21,857 55,385
James J. Ashburn 1,100 3.6% 31.59 2006 21,857 55,385
Michael R. O'Dell 1,100 3.6% 31.59 2006 21,857 55,385
Michael T. Riley 1,100 3.6% 31.59 2006 21,857 55,385
</TABLE>
(1) As required by rules of the Securities and Exchange Commission,
potential values stated are based on the prescribed assumption that the
Corporation's common shares will appreciate in value from the date of
grant to the end of the option term (ten years from the date of grant)
at annualized rates of 5% and 10% (total appreciation of 63% and 159%
resulting in values of approximately $51.46 and $81.94), respectively,
and therefore are not intended to forecast possible future appreciation,
if any, in the price of the Corporation's common shares. As an
alternative to the assumed potential realizable values stated in the
above table, the Securities and Exchange Commission rules would permit
stating the present value of such options at date of grant. Methods of
computing present values suggested by different authorities can produce
significantly different results. Moreover, since stock options granted
by the Corporation are not transferable, there is no objective criteria
by which any computation of present value can be verified. Consequently,
the Corporation's management does not believe there is reliable method
of computing the present value of such stock options.
(2) All options are granted at 100% of fair market value on the date of
grant. The options are exercisable during a period commencing one year
after the date of grant and ending on the date specified in the option
which, in no event, is later than 10 years after the date of grant;
provided, that the optionee remained in the employment of the
Corporation or its affiliates. The option exercise period may be
shortened upon an optionee's disability, retirement or death. Shares
acquired upon option exercise must be held one year from the date of
exercise.
(3) Adjusted for 10% stock dividend on November 1, 1996.
<PAGE>
The following table shows aggregate option exercises in the last fiscal
year and year end values.
<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION/SAR VALUES
(a) (b) (c) (d) (e)
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
FY-End(#)(2) FY-End ($)(3)
Shares Acquired Exercisable (E)/ Exercisable (E)/
Name on Exercise(#)(1) Value Realized(1)($) Unexercisable (U) Unexercisable (U)
- ---- ----------------- -------------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Stanley N. Pontius 0 0 E 17,267 E $135,681
U 1,100 U $ 1,001
Rick L. Blossom 860 7,011 E 2,577 E $ 7,860
U 1,100 U $ 1,001
James J. Ashburn 10,971 97,753 E 220 E $ 2,110
U 1,110 U $ 1,001
Michael R. O'Dell 0 0 E 3,025 E $ 7,939
U 1,100 U $ 1,001
Michael T. Riley 182 1,253 E 1,375 E $ 4,194
U 1,100 U $ 1,001
</TABLE>
(1) Aggregate market value of shares covered by the option less the aggregate
price paid by the executive officer.
(2) Adjusted for stock dividends.
(3) Values stated reflect gains on outstanding options based on the fair market
value of $32.50 per common share of the Corporation on December 31, 1996.
The Corporation has no long term incentive plans relating to future
compensation of the Chief Executive Officer or the named executive officers
other than the 1991 Stock Incentive Plan.
<PAGE>
Personal Benefits
The executive officers of the Corporation and its subsidiaries also
receive certain fringe benefits such as participation in group medical and life
insurance programs which are generally available to employees of the Corporation
and its subsidiaries on a non-discriminatory basis. In addition, the executive
officers are reimbursed for business-related expenses they incur (including
certain club dues and expenses), and some officers also have the use of
Corporation-owned automobiles. Management believes that the costs of
reimbursement of such expenses and providing such automobiles constitute
ordinary and necessary business expenses that facilitate job performance and
minimize work-related expenses incurred by the executive officers. Executive
officers have included in their taxable income the cost of personal use of
Corporation-owned automobiles. Management has concluded that the aggregate
amount of such personal benefits does not exceed the lesser of $50,000 with
respect to any executive officer or 10% of the compensation of such person.
Benefit Plans
RETIREMENT PLAN AND THRIFT PLAN. The Corporation and its subsidiaries
have a thrift plan and a retirement plan. The retirement plan and the thrift
plan cover the majority of the employees of the Corporation and its
subsidiaries, including the officers of the Corporation. All employees who are
21 years of age and have had one (1) year of service are covered.
The thrift plan is voluntary and participants may contribute to the
plan. The subsidiaries' contributions are 50% of each participant's contribution
limited to 3% of base salary of each participant and become fully vested when
made. All employees, however, may contribute to the plan in excess of the
matching contributions up to 12% of base salary.
In the non-contributory retirement plan, participants are 100% vested
after five (5) years of credited service. The normal retirement benefit at the
normal retirement age (65), effective January 1, 1989, is 1.1% of the average
monthly compensation multiplied by years of service (maximum of 40), plus .6% of
average monthly compensation greater than Social Security covered compensation
multiplied by years of service (maximum of 35). Average monthly compensation is
the average monthly compensation for the five consecutive plan years which
produce the highest average. The estimated benefits accrued during the year
under the retirement plan for each of the officers in the remuneration table are
not actuarially ascertainable under the methods used for calculation of the cost
to the Corporation by the actuaries. The cost of the plan for the subsidiaries
is set forth in the consolidated financial statements contained in the Annual
Report to shareholders.
<PAGE>
Under the retirement plan, amounts that are payable to persons in selected
remuneration and service classifications are:
<TABLE>
<CAPTION>
Estimated Annual Benefits
For Years of Credited Service Indicated (1)(2)
Annual Salary 15 20 25 30 35 40
- ------------- -- -- -- -- -- --
<S> <C> <C> <C> <C> <C> <C>
$ 25,000 $ 5,250 $ 7,000 $ 8,375 $ 9,750 $ 11,125 $ 12,500
$ 50,000 11,393 15,191 18,614 22,036 25,459 28,209
75,000 17,768 23,691 29,239 34,786 40,334 44,459
100,000 24,143 32,191 39,864 47,536 55,209 60,709
125,000 30,518 40,691 50,489 60,286 70,084 76,959
150,000 36,893 49,191 61,114 73,036 84,959 93,209
175,000 43,268 57,691 71,739 85,786 99,834 109,459
200,000 49,643 66,191 82,364 98,536 114,709 125,709
225,000 56,018 74,691 92,989 111,286 129,584 141,959
250,000(2) 62,393 83,191 103,614 124,036 144,459 158,209
275,000(2) 63,413 84,551 105,314 126,076 146,839 160,809
300,000(2) 63,413 84,551 105,314 126,076 146,839 160,809
325,000(2) 63,413 84,551 105,314 126,076 146,839 160,809
</TABLE>
(1) The amounts of covered compensation (columns (c) and (d) of the Summary
Compensation Table) which can be used to compute the estimated annual benefit
and the credited years of participation under the plan for each of the
individuals named in the Summary Compensation Table were as follows: Stanley N.
Pontius -- $366,542 and 5 years; Rick L. Blossom -- $187,313 and 12 years; James
J. Ashburn -- $187,910 and 20 years; Michael R. O'Dell --$126,393 and 18 years;
and Michael T. Riley -- $121,425 and 13 years.
(2) As a result of the provisions of the Internal Revenue Code and the
Non-Qualified Insured Supplemental Retirement Plan, maximum annual compensation
for which benefits will be paid under the pension plan is [$_________.] Messrs.
Pontius, Ashburn and Blossom participate in the Non-Qualified Insured
Supplemental Retirement Plan implemented during 1994 pursuant to which benefits
equal to the benefits which cannot be paid from the retirement plan by reason of
limitations imposed under the Internal Revenue Code will be paid directly by the
Corporation. (The Corporation has acquired life insurance contracts to provide
the funds for these non-qualified benefits pursuant to the foregoing plan.)
Contributions to the trust, whether by cash or accrual, are made on an actuarial
basis and are reflected in the Annual Report to shareholders.
<PAGE>
PERFORMANCE GRAPH
The following graph compares the total five year cumulative return of
the Corporation with a group of comparable bank holding companies as an index of
the Corporation's performance against certain Ohio, Indiana and Wisconsin
companies in its industry and a broad market index known as the NASDAQ Market
Index.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
[Performance Graph-GRAPHIC]
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
FFBC ........................ 100 121.42 175.36 185.83 200.34 210.67
PEER GROUP .................. 100 136.80 170.81 174.97 217.28 287.83
NASDAQ BROAD MARKET INDEX ... 100 100.98 121.13 127.17 164.96 204.98
</TABLE>
The peer issuers in the table are CNB Bancshares, First Financial
Bancorp., First Financial Corp., First Source Corp., Fort Wayne National, Irwin
Financial, Mid-Am Inc., Old National Bancorp and Provident Bancorp. Each
comparison to the Corporation has been weighted for stock market capitalization
of each peer issuer. The peer group represents certain Ohio, Indiana and
Wisconsin bank holding companies between $500 million and $7 billion in assets
which have been public bank holding companies for more than five years.
The broad market index is a compilation from the NASDAQ Market Index
prepared on a total return basis with dividends reinvested and is composed of
companies (U.S. and foreign) which have been public companies for five years or
more.
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
Mr. Pontius, the President and Chief Executive Officer of the
Corporation, is a director of Ohio Casualty Corporation. During 1996, Mr.
Porter, who is Chief Financial Officer/Treasurer of Ohio Casualty Corporation,
served on the Corporation's Compensation Committee. In addition, Mr. Patch, who
is the President of Ohio Casualty Corporation, was a director of the Corporation
during 1996. A banking subsidiary of the Corporation participates (with other
banks) in a loan to Ohio Casualty Corporation, and such loan (a) was made in the
ordinary course of business, (b) was made on substantially the same terms,
including interest and nature of collateral, as those prevailing at the time for
comparable transactions with other persons, and (c) did not involve more than
the normal risk of collectibility or present unfavorable features.
COMPENSATION COMMITTEE REPORT
The Compensation Committee's goal in setting executive compensation is
to provide incentives to its executive officers to increase stockholder value.
To achieve this goal, the Compensation Committee authorizes base salaries that
are competitive with those set at bank holding companies of comparable size and
performance and uses programs that personally reward executives for corporate
financial results (i) that are above those of the comparable bank holding
companies and (ii) that have benefited the Corporation's shareholders.
The components of the Corporation's Executive Compensation program are
base salary, a Performance Incentive Compensation Plan ("PIC") and the 1991
Stock Incentive Plan.
In determining each executive officer's base salary, the Compensation
Committee utilizes studies prepared by Wyatt Data Services of New York ("WDS")
and The Ohio Bankers Association ("OBA") salary survey. The WDS survey compiles
total compensation data based on asset size and geographic region, including
salary ranges, by position, for over 100 banks located nationwide and of similar
size to the Corporation. The WDS survey includes banks owned by several of the
peer group issuers; however, the majority of the banks owned by the peer group
issuers, although of similar asset size and geographic region to the
Corporation, did not participate in such survey. In addition, the peer group
issuers are bank holding companies and the WDS survey is of banks. The OBA
survey sets forth commercial bank officer salaries in Ohio, Indiana, Michigan
and Illinois. Since the WDS survey's data base is considerably larger than the
OBA's data base, the Compensation Committee uses the WDS survey as its primary
source for comparisons.
After consideration of: (i) a comparison of the Corporation to other
banks contained in the WDS and OBA surveys, and their size, profitability,
number of officers and employees, officers' experience and officers'
responsibilities; (ii) historical compensation data for each of the executive
officers; and (iii) the estimated maximum PIC payouts as a component of total
compensation and its effect on base salary; the Compensation Committee
determined the base salaries of the Chief Executive Officer and the other named
executive officers and the full Board of Directors approved the Committee's
recommendations. According to WDS data, Mr. Pontius' 1996 total compensation is
appropriate for the asset size of the Corporation. The Committee considers that
the other four named executive officers are, in relation to WDS data,
appropriately compensated for their respective levels of responsibility,
performance, knowledge, and experience.
<PAGE>
The PIC covered 48 key executives (including the named executive
officers) of the Corporation and its affiliates. Payouts under the PIC are based
on meeting or exceeding specific pre-set targets. Key officers are awarded
points based on their level of success in reaching established targets. Each
point achieved equals one percent of base salary of the participant to a pre-set
maximum. For 1996, the targeted areas were net earnings increase combined with
the return on equity, return on assets and the price of the Corporation's common
shares compared to the book value of the Corporation. Other areas considered
were control of non-interest expense, net interest margin and loan loss reserve
coverage, with the targeted areas being weighted differently depending on each
officer's responsibilities. The maximum payouts for the named executive officers
was as follows: Mr. Pontius - 30 points, Mr. Blossom - 25 points, and each of
Messrs. Ashburn, O'Dell and Riley - 20 points. Mr. Pontius and the other named
executive officers received 100% of their pre-set targets. For Mr. Pontius, the
targeted areas were weighted as follows: net earnings increase combined with
return on equity (33 1/3%), return on assets (50%), and common share price
compared to book value (16 2/3%). The Compensation Committee approved the PIC
targets and percentages, and the Board of Directors approved the Committee's
recommendations. In addition, all employees of First National Bank of
Southwestern Ohio received a year-end bonus equal to 4.0% of their base salary
(except the named executive officers who received 3.5% as in the past). The
Board of Directors determines subjectively the amount of the bonus.
The Corporation's 1991 Stock Incentive Plan provides incentive
compensation to executive officers that is tied to the enhancement of
shareholder value. The Compensation Committee determined and approved a
restricted share grant and an incentive stock option for the Chief Executive
Officer based on the Committee's subjective evaluation of the Chief Executive
Officer's performance taking into consideration the Corporation's profitability
and overall 1996 financial performance.
Regarding the compensation of Mr. Pontius, President and Chief
Executive Officer, based on the foregoing, Mr. Pontius received his base salary,
a PIC award of $84,000, a restricted share grant for 1,000 common shares, and an
incentive stock option for 1,000 common shares.
The Compensation Committee is aware of Section 162(m) of the Internal
Revenue Code but believes that it has no application to the Corporation at the
present time based on the present levels and the anticipated levels during the
next few years of qualifying compensation paid to its executive officers.
<PAGE>
COMPENSATION COMMITTEE
Barry J. Levey, Chairman Vaden Fitton
Arthur W. Bidwell Charles T. Koehler
Thomas C. Blake Barry S. Porter
Richard J. Fitton
ANNUAL REPORT
The Corporation's Annual Report for the year ended December 31, 1996,
is being mailed to each shareholder with the Proxy and Proxy Statement.
SHAREHOLDER PROPOSALS
If an eligible shareholder wishes to present a proposal for action at
the next Annual Meeting of the Corporation, it shall be presented to management
by certified mail, written receipt requested, not later than November 14, 1997,
for inclusion in the Corporation's Proxy Statement and form of Proxy relating to
that meeting. Any such proposal must comply with Rule 14a-8 promulgated by the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, as amended. Proposals shall be sent to First Financial Bancorp.,
Attention: Michael R. O'Dell, Senior Vice President, Chief Financial Officer and
Secretary, 300 High Street, P.O. Box 476, Hamilton, Ohio 45012-0476.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act requires the Corporation's
officers and directors, and persons who own more than ten percent of a
registered class of the Corporation's equity securities, to file reports of
ownership and changes in ownership on Forms 3,4, and 5 with the Securities and
Exchange Commission (SEC) and the National Association of Securities Dealers
(NASDAQ). Officers, directors and greater than ten percent shareowners are
required by SEC regulation to furnish the Corporation with copies of all Forms
3, 4, and 5 they file.
Based solely on the Corporation's review of the copies of such forms it
has received and written representations from certain reporting persons that
they were not required to file Forms 5 for specified fiscal years, the
Corporation believes that all its officers, directors, and greater than ten
percent beneficial owners complied with all filing requirements applicable to
them with respect to transactions during fiscal 1996.
OTHER MATTERS
Some of the officers and directors of the Corporation and the companies
with which they are associated were customers of the banking subsidiaries of the
Corporation. The loans to such officers and directors and the companies with
which they are associated (a) were made in the ordinary course of business, (b)
were made on substantially the same terms, including interest and nature of
collateral, as those prevailing at the time for comparable transactions with
other persons, and (c) did not involve more than the normal risk of
collectibility or present other unfavorable features.
<PAGE>
The subsidiaries of the Corporation have had, and expect to have in the
future, banking transactions in the ordinary course of business with directors,
officers, principal stockholders, and their associates on the same terms,
including interest rates and collateral on loans, as those prevailing at the
same time for comparable transactions with others.
A SHAREHOLDER OF THE CORPORATION MAY OBTAIN A COPY OF THE ANNUAL REPORT
ON FORM 10-K, INCLUDING FINANCIAL STATEMENTS AND SCHEDULES THERETO, FOR THE
FISCAL YEAR ENDED DECEMBER 31, 1996 AND AS FILED WITH THE SEC WITHOUT CHARGE BY
SUBMITTING A WRITTEN REQUEST TO THE FOLLOWING ADDRESS:
FIRST FINANCIAL BANCORP.
Attention: Michael R. O'Dell, Senior Vice President,
Chief Financial Officer, and Secretary
300 High Street
P.O. Box 476
Hamilton, Ohio 45012-0476
Management and the Board of Directors of the Corporation know of no
business to be brought before the meeting other than as set forth in this Proxy
Statement. However, if any matters other than those referred to in this
Statement should properly come before the meeting, it is the intention of the
persons named in the enclosed proxy to vote such proxy on such matters in
accordance with their best judgment.
The expense of proxy solicitation will be borne by the Corporation.
Proxies will be solicited by mail and may be solicited, for no additional
compensation, by some of the officers, directors and employees of the
Corporation or its subsidiaries, by telephone or in person. Brokerage houses and
other custodians, nominees and fiduciaries may be requested to forward
soliciting material to the beneficial owners of shares of the Corporation and
will be reimbursed for their related expenses.
By Order of the Board of Directors,
/s/Michael R. O'Dell
--------------------
Michael R. O'Dell, Senior Vice President,
Chief Financial Officer, and Secretary
March 14, 1997
<PAGE>
FIRST FINANCIAL BANCORP. P R O X Y
ANNUAL MEETING OF SHAREHOLDERS -- APRIL 22, 1997
Each undersigned shareholder of First Financial Bancorp. (the
"Corporation") hereby constitutes and appoints Robert E. Ireland and Robert B.
Croake, or either of them, with full power of substitution in each of them, the
proxy or proxies of the undersigned to vote only at the Annual Meeting of
Shareholders of the Corporation to be held at the Fitton Center for Creative
Arts, 101 South Monument Avenue, Hamilton, Ohio 45011, on April 22, 1997, at
2:00 P.M., local time, and at any adjournment thereof, all of the shares of the
Corporation which the undersigned would be entitled to vote if personally
present at such meeting, or at any adjournment thereof:
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE FOLLOWING ITEMS:
1. Election of Directors
|_| FOR all nominees listed below
(except as marked to the contrary below)
|_| WITHHOLD AUTHORITY
CLASS II TERM EXPIRING IN 2000: Richard L. Alderson, James C. Garland,
Murph Knapke, Stanley N. Pontius, Barry S. Porter and Perry D. Thatcher
CLASS I TERM EXPIRING IN 1999: Steven C. Posey
INSTRUCTION: To withhold authority to vote for any individual nominee,
line through the nominee's name listed above.
2. The amendment to the Corporation's Articles of Incorporation
|_| FOR |_| AGAINST |_| ABSTAIN
3. The amendment and restatement of the Corporation's Regulations
|_| FOR |_| AGAINST |_| ABSTAIN
4. To consider and act upon, in their discretion, such other matters as may
properly come before the meeting or any adjournment thereof.
(Continued, and to be signed on the other side)
<PAGE>
(continued from other side)
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFIC INDICATION ON THE
REVERSE SIDE. IN THE ABSENCE OF SUCH INDICATION THIS PROXY WILL BE VOTED FOR THE
ELECTION OF EACH OF THE ABOVE NAMED NOMINEES FOR DIRECTOR.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS and may be revoked
prior to its exercise. Receipt of the accompanying Proxy Statement is hereby
acknowledged.
Dated:
____________________________________
Number of Shares:___________________________
____________________________________________
____________________________________________
Signature(s) of Shareholders(s)
The signature or signatures of this Proxy
should be the same as the name or names which
appear hereon. Persons signing in a fiduciary
capacity should give full title as such.
PLEASE MARK, DATE, SIGN AND RETURN PROMPTLY IN THE ENCLOSED STAMPED ENVELOPE.
<PAGE>
Deletions appear as bracketed text APPENDIX A
Additions appear as "bold" text
AMENDED AND RESTATED [CODE OF] REGULATIONS
OF
FIRST FINANCIAL BANCORP.
ARTICLE I
MEETINGS OF SHAREHOLDERS
SECTION 1.1. ANNUAL MEETING. The regular annual meeting of the
shareholders for the election of directors and the transaction of whatever other
business may properly come before the meeting, shall be held at the [main]
PRINCIPAL office of the Corporation, 300 High Street, Hamilton, Ohio, or such
other place as the Board of Directors may designate, at 2:00 P.M., on the fourth
Tuesday of April each year. Notice of such meeting shall be mailed, postage
prepaid, at least ten days prior to the date thereof, addressed to each
shareholder at his address appearing on the books of the Corporation. [If, from
any cause, an election of directors is not made on said day, the Board of
Directors shall order the election to be held on some subsequent day, as soon
thereafter as practicable, according to the provisions of law; and notice
thereof shall be given in the manner herein provided for the annual meeting.]
SECTION 1.2. SPECIAL MEETINGS. [Except as otherwise specifically
provided by statute, special meetings of the shareholders may be called for any
purpose at any time by the Board of Directors or by any three or more
shareholders owning, in the aggregate, not less than fifty percent of the stock
of the Corporation. Every such special meeting, unless otherwise provided by
law, shall be called by mailing, postage prepaid, not less than ten days prior
to the date fixed for such meetings, to each shareholder at his address
appearing on the books of the Corporation, a notice stating the purpose of the
meeting.]
SPECIAL MEETINGS OF SHAREHOLDERS FOR ANY PURPOSE OR PURPOSES MAY BE
CALLED BY THE CHAIRMAN OF THE BOARD, BY THE PRESIDENT, BY THE VICE PRESIDENT
AUTHORIZED TO EXERCISE THE AUTHORITY OF THE PRESIDENT IN THE CASE OF THE
PRESIDENT'S ABSENCE, DEATH OR DISABILITY, BY RESOLUTION OF THE DIRECTORS OR BY
THE HOLDERS OF NOT LESS THAN ONE-HALF OF THE OUTSTANDING VOTING POWER OF THE
CORPORATION.
SECTION 1.3. QUORUM. [Except as otherwise provided by the
statutes of Ohio, the holders of record of a majority of shares entitled to
vote, whether present in person, or by proxy, shall constitute a quorum at any
and all meetings of shareholders, but less than a quorum may adjourn any meeting
from time to time.]
AT ALL MEETINGS OF SHAREHOLDERS, THE HOLDERS OF RECORD OF A MAJORITY
OF SHARES ENTITLED TO VOTE AT EACH MEETING, PRESENT IN PERSON OR BY PROXY, SHALL
CONSTITUTE A QUORUM, BUT NO ACTION REQUIRED BY LAW, THE (AMENDED) ARTICLES OR
THESE AMENDED AND RESTATED REGULATIONS TO BE AUTHORIZED OR TAKEN BY THE HOLDERS
OF A DESIGNATED PROPORTION OF THE SHARES OF ANY PARTICULAR CLASS OR OF EACH
CLASS, MAY BE AUTHORIZED OR TAKEN BY A LESSER PROPORTION. THE HOLDERS OF A
MAJORITY OF THE VOTING SHARES REPRESENTED AT A MEETING, WHETHER OR NOT A QUORUM
IS PRESENT, MAY ADJOURN SUCH MEETING FROM TIME TO TIME.
<PAGE>
SECTION 1.4. PROXIES. Any shareholder entitled to vote at a
meeting of shareholders may be represented and vote thereat by proxy appointed
by an instrument in writing subscribed by the shareholder or his duly authorized
agent, and submitted to the secretary of the Corporation or the inspectors of
election at or before said meeting.
ARTICLE II
DIRECTORS
SECTION 2.1. NOMINATION. [Nominations for the election of
directors may be made by the Board of Directors or may be made by any
shareholder entitled to vote for the election of directors. Any nomination by a
shareholder shall be made by notice in writing, delivered or mailed by
registered United States mail, postage prepaid, to the secretary of the
corporation not less than fourteen (14) days nor more than fifty (50) days prior
to any meeting of the shareholders called for the election of directors;
provided, however, that if less than twenty-one (21) days' notice of the meeting
is given to shareholders, such written nomination shall be delivered or mailed,
as prescribed, to the secretary of the Corporation not later than the close of
the seventh day following the day on which notice of the meeting was mailed to
shareholders. Each such notice shall contain the following information to the
extent known to the notifying shareholder: (a) name and address of each proposed
nominee; (b) principal occupation of each proposed nominee; (c) total number of
shares of stock of the Corporation that will be voted for each proposed nominee;
(d) the name and residence address of the notifying shareholder; and (e) the
number of shares of stock of the corporation owned by the notifying shareholder.
The Chairman of the meeting may, in his discretion, determine and declare to the
meeting that the nomination was not made in accordance with the foregoing
procedure and, in such event, the defective nomination shall be disregarded.]
NOMINATIONS FOR THE ELECTION OF DIRECTORS MAY BE MADE BY THE BOARD OF
DIRECTORS OR A COMMITTEE APPOINTED BY THE BOARD OF DIRECTORS OR BY ANY
SHAREHOLDER ENTITLED TO VOTE IN THE ELECTION MUST DELIVER WRITTEN NOTICE THEREOF
TO THE SECRETARY OF THE CORPORATION NOT LATER THAN (I) WITH RESPECT TO AN
ELECTION TO BE HELD AT ANY ANNUAL MEETING OF SHAREHOLDERS, 90 DAYS PRIOR TO THE
DATE ONE YEAR FROM THE DATE OF THE IMMEDIATELY PRECEDING ANNUAL MEETING OF
SHAREHOLDERS, AND (II) WITH RESPECT TO AN ELECTION TO BE HELD AT A SPECIAL
MEETING OF SHAREHOLDERS FOR THE ELECTION OF DIRECTORS, THE CLOSE OF BUSINESS ON
THE TENTH DAY FOLLOWING THE DATE ON WHICH NOTICE OF SUCH MEETING IS FIRST GIVEN
TO SHAREHOLDERS. SUCH A NOTICE TIMELY GIVEN BY A SHAREHOLDER SHALL SET FORTH
CERTAIN INFORMATION CONCERNING SUCH SHAREHOLDER AND HIS OR HER NOMINEE(S),
INCLUDING: THE NAME AND ADDRESS OF THE SHAREHOLDER AND EACH NOMINEE; THE AGE AND
PRINCIPAL OCCUPATION OR EMPLOYMENT OF EACH NOMINEE; THE NUMBER OF SHARES OF
EQUITY SECURITIES BENEFICIALLY OWNED BY EACH NOMINEE; A REPRESENTATION THAT THE
SHAREHOLDER IS A HOLDER OF RECORD OF SHARES ENTITLED TO VOTE AT THE MEETING AND
INTENDS TO APPEAR IN PERSON OR BY PROXY AT THE MEETING TO NOMINATE THE PERSON OR
PERSONS SPECIFIED IN THE NOTICE; A DESCRIPTION OF ALL ARRANGEMENTS OR
UNDERSTANDINGS BETWEEN THE SHAREHOLDER AND EACH NOMINEE; SUCH OTHER INFORMATION
REGARDING EACH NOMINEE AS WOULD BE REQUIRED TO BE INCLUDED IN A PROXY STATEMENT
FILED PURSUANT TO THE PROXY RULES OF THE SECURITIES AND EXCHANGE COMMISSION HAD
THE NOMINEE BEEN NOMINATED BY THE BOARD OF DIRECTORS; AND THE CONSENT OF EACH
NOMINEE TO SERVE AS A DIRECTOR OF THE CORPORATION IF ELECTED. THE CORPORATION
MAY ALSO REQUIRE ANY PROPOSED NOMINEE TO FURNISH OTHER INFORMATION REASONABLY
REQUIRED BY THE CORPORATION TO DETERMINE THE PROPOSED NOMINEE'S ELIGIBILITY TO
SERVE AS A DIRECTOR. THE PRESIDING OFFICER AT THE MEETING MAY REFUSE TO
ACKNOWLEDGE THE NOMINATION OF ANY PERSON NOT MADE IN COMPLIANCE WITH THE
FOREGOING PROCEDURES AND ANY PERSON NOT NOMINATED IN ACCORDANCE WITH THE
FOREGOING PROCEDURES SHALL NOT BE ELIGIBLE FOR ELECTION AS A DIRECTOR.
<PAGE>
SECTION 2.2. NUMBER. The number of directors of the Corporation,
which shall not be less than nine nor more than twenty-five, shall be fifteen
until increased or decreased at any time by the affirmative vote of two-thirds
of the whole authorized number of directors or, at a meeting of the shareholders
called for the purpose of electing directors at which a quorum is present, [by
the affirmative vote of the holders of a majority of the shares which are
represented at the meeting and entitled to vote on the proposal.] BY THE
AFFIRMATIVE VOTE OF THE HOLDERS OF AT LEAST TWO-THIRDS OF THE OUTSTANDING VOTING
POWER OF THE CORPORATION VOTING AS A SINGLE CLASS. Directors shall hold office
in their respective classes for three-year terms. The election of directors
shall be held at the annual meeting of shareholders for the class year of
directors whose terms expire at the annual meeting, except that a majority of
the directors in office at any time, though less than a majority of the whole
authorized number of directors, may, by the vote of a majority of their number,
fill any director's office that is created by an increase in the number of
directors or by a vacancy; provided, however, that in any period between annual
meetings of shareholders, the directors will not increase the number of
directors by more than three. A vacancy is created by the death, resignation,
removal or incapacity of a director prior to the end of his term or by the
failure of the shareholders at any time to elect the whole authorized number of
directors. A director may be removed for cause. Cause if defined to exist if a
court of law finds a director guilty of a felony or has breached his fiduciary
duty under the laws of Ohio.
SECTION 2.3. CLASSES OF DIRECTORS. The directors' terms are
divided into three classes of terms consecutively expiring. The classes are
known as Classes I, II and III. The directors of each class are shown on the
Proxy Statement issued to shareholders of record.
SECTION 2.4. MEETINGS. Meetings of the Board of Directors shall
be held at the [main] PRINCIPAL office of the Corporation or at such other
place, within or without the State of Ohio, as may be determined by the Board.
[One] TWO day's notice of such meeting shall be given to each director, unless
the Board of Directors has fixed a regular time and place for such meetings, in
which case no notice shall be required for meetings held at such time and place.
Meetings may be called by the Chairman of the Board, the President, or by any
seven directors, upon giving the notice as herein required.
SECTION 2.5. MANDATORY RETIREMENT. No person shall be elected or
re- elected a director after reaching his seventieth (70th) birthday.
SECTION 2.6. DIRECTOR EMERITUS. The Board shall have the right
from time to time to choose as Directors Emeritus persons who have had prior
service as members of the Board and who may receive such compensation as shall
be fixed from time to time by the Board of Directors.
SECTION 2.7. [EXECUTIVE] COMMITTEES. The Board of Directors is
authorized to create an Executive Committee of not less than three (3) members
of the Board and such other committees as it sees fit, which, to the extent
authorized by the Board of Directors, may exercise all powers of the Board of
Directors between meetings of said Board, [except to the extent prohibited by
the laws of the State of Ohio.] OTHER THAN THAT OF FILLING VACANCIES AMONG THE
DIRECTORS OR ANY COMMITTEE OF THE DIRECTORS. The [Chairman of the] Board of
Directors [or in his absence, the President,] may designate any one of the
directors of the Corporation as an alternate member of any committee to replace
any absent or disqualified member at any meeting of such committee.
<PAGE>
ARTICLE III
OFFICERS
SECTION 3.1. CHAIRMAN OF THE BOARD. The Board of Directors may
appoint one of its members to be Chairman of the Board to serve at the pleasure
of the Board. He shall preside at all meetings of the Board of Directors. He
shall exercise such powers and duties, as from time to time may be conferred
upon, or assigned to, him by the Board of Directors.
SECTION 3.2. PRESIDENT. The Board of Directors shall appoint one
of its members to be President of the Corporation. In the absence of the
Chairman, he shall preside at any meeting of the Board. The President shall have
general executive powers, and shall have and may exercise any and all other
powers and duties pertaining by law, regulation, or practice, to the office of
President, or imposed by these AMENDED AND RESTATED Regulations. He shall also
have and may exercise such further powers and duties as from time to time may be
conferred upon, or assigned to, him by the Board of Directors.
SECTION 3.3. VICE PRESIDENTS. The Board of Directors may appoint
one or more Vice Presidents. Each Vice President shall have such powers and
duties as may be assigned to him by the Chief Executive Officer.
SECTION 3.4. SECRETARY. The Board of Directors shall appoint a
Secretary who shall keep accurate minutes of all meetings. He shall attend to
the giving of all notices required by these AMENDED AND RESTATED Regulations to
be given. He shall be custodian of the corporate seal, records, documents and
papers of the Corporation. He shall provide for the keeping of proper records of
all transactions of the Corporation. He shall have and may exercise any and all
other powers and duties pertaining by law, regulation or practice, to the office
of the Secretary or imposed by these AMENDED AND RESTATED Regulations. He shall
also perform such other duties as may be assigned to him, from time to time by
the Chief Executive Officer.
SECTION 3.5. OTHER OFFICERS. All other officers appointed by the
Board of Directors shall have such duties as defined by law and as may from time
to time be assigned to them by the Chief Executive Officer or the Board of
Directors.
SECTION 3.6. TERM OF OFFICE. All officers of the Corporation
shall be chosen by the Board of Directors by a majority vote and shall hold
office until the first meeting of the Board of Directors following the next
annual meeting of shareholders or until their successors are elected and duly
qualified. The Board of Directors may remove any officer at any time with or
without cause by a majority vote.
SECTION 3.7. RETIREMENT DATE. Normal retirement date for all
employees is the employee's 65th birthday.
ARTICLE [III-A] IV
INDEMNIFICATION [AND INSURANCE]
[SECTION 3-A.1. MANDATORY INDEMNIFICATION. The Corporation shall
indemnify any officer or director, or any other employee of the Corporation who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceedings, whether civil, criminal,
administrative or investigative (including, without limitation, any action
<PAGE>
threatened or instituted by or in the right of the Corporation), by reason of
the fact that he is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, trustee, officer, employee or agent of another corporation (domestic
or foreign, nonprofit or for profit), partnership, joint venture, trust or other
enterprise, against expenses (including, without limitation, attorneys' fees,
filing fees, court reporters' fees and transcript costs), judgment, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
Corporation, and with respect to any criminal action or proceeding, he had no
reasonable cause to believe his conduct was unlawful. A person claiming
indemnification under this Section 3-A.1 shall be presumed to have met the
applicable standard of conduct set forth herein, and the termination of any
action, suit or proceeding by judgment, order, settlement or conviction, or upon
a plea of nolo contenders or its equivalent, shall not, of itself, rebut such
presumption.
SECTION 3-A.2. COURT-APPROVED INDEMNIFICATION. Anything contained
in the Regulations or elsewhere to the contrary notwithstanding:
(A) the Corporation shall not indemnify any officer or director
or employee of the Corporation who was a party to any completed action or suit
instituted by or in the right of the Corporation to procure a judgment in its
favor by reason of the fact he is or was a director, officer, employee or agent
of the Corporation, or is or was serving at the request of the Corporation as a
director, trustee, officer, employee or agent of another corporation (domestic
or foreign, nonprofit or for profit), partnership, joint venture, trust or other
enterprise, in respect of any claim, issue or matter asserted in such action or
suit as to which he shall have been adjudged to be liable for misconduct (other
than negligence of any degree) in the performance of his duty to the Corporation
unless and only to the extent that the Court of Common Pleas of Butler County,
Ohio or the court in which such action or suit was brought shall determine upon
application that, despite such adjudication of liability, and in view of all the
circumstances of the case, he is fairly and reasonably entitled to such
indemnity as such Court of Common Pleas or such other court shall deem proper;
and
(B) the Corporation shall promptly make any such unpaid
indemnification as is determined by a court to be proper as contemplated by this
Section 3-A.2.
SECTION 3-A.3. INDEMNIFICATION FOR EXPENSES. Anything contained
in the Regulations or elsewhere to the contrary notwithstanding, to the extent
that an officer, director or employee of the Corporation has been successful on
the merits or otherwise in defense of any action, suit or proceeding referred to
in Section 3-A.1, or in defense of any claim, issue or matter therein, he shall
be promptly indemnified by the Corporation against expenses (including, without
limitation, attorneys' fees, filing fees, court reporters' fees and transcript
costs) actually and reasonably incurred by him in connection therewith.
SECTION 3-A.4. DETERMINATION REQUIRED. Any indemnification
required under Section 3-A.1 and not precluded under Section 3-A.2 shall be made
by the Corporation only upon a determination that such indemnification of the
officer or director or employee is proper in the circumstances because he has
met the applicable standard of conduct set forth in Section 3-A.1. Such
determination may be made only (A) by a majority vote of a quorum consisting of
<PAGE>
directors of the Corporation who were not and are not parties to, or threatened
with, any such action, suit or proceeding, or (B) if such a quorum is not
obtainable or if a majority of a quorum of disinterested directors so directs,
in a written opinion by independent legal counsel other than an attorney, or a
firm having associated with it an attorney, who has been retained by or who has
performed services for the Corporation, or any person to be indemnified, within
the past five years, or (C) by the shareholders, or (D) by the Court of Common
Pleas of Butler County, Ohio or (if the Corporation is a party thereto) the
court in which such action, suit or proceeding was brought, if any. Any
determination made by the disinterested directors under subparagraph (A) of this
Section or by independent legal counsel under subparagraph (B) of this Section
to make indemnification in respect of any claim, issue or matter asserted in an
action or suit threatened or brought by or in the right of the Corporation shall
be promptly communicated to the person who threatened or brought such action or
suit, and within ten (10) days after receipt of such notification such person
shall have the right to petition the Court of Common Pleas of Butler County,
Ohio or the court in which such action or suit was brought, if any, to review
the reasonableness of such determination.
SECTION 3-A.5. ADVANCES FOR EXPENSES. Unless the only liability
asserted against a director in an action, suit or proceeding referred to in
Section 3-A.1 of this article arises pursuant to Section 1701.95 of the Ohio
Revised Code, expenses, including attorney's fees, incurred by a director in
defending the action, suit or proceeding shall be paid by the Corporation as
they are incurred, in advance of the final disposition of the action, suit or
proceeding, upon receipt of an undertaking by or on behalf of the director in
which he agrees: (I) to repay amounts so advanced if it is proved by clear and
convincing evidence in a court of competent jurisdiction that his action or
failure to act was undertaken with deliberate intent to cause injury to the
Corporation or with reckless disregard for the best interests of the
Corporation; and (ii) to reasonably cooperate with the Corporation with respect
to the action, suit or proceeding.
Expenses, including attorney's fees, incurred by a director,
trustee, officer, employee or agent in defending any action, suit or proceeding
referred to in Section 3-A.3 of this Article, may be paid by the Corporation as
they are incurred, in advance of the final disposition of the action, suit or
proceeding as authorized by the directors in the specific case, upon receipt of
an undertaking by or on behalf of the director, trustee, officer, employee, or
agent to repay such amount if it is ultimately determined that he is not
entitled to be indemnified by the Corporation.
SECTION 3-A.6. ARTICLE III-A NOT EXCLUSIVE. The indemnification
provided by this Article III-A shall not be deemed exclusive of any other rights
to which any person seeking indemnification may be entitled under the Articles
or the Regulations or any agreement, vote of shareholders or disinterested
directors, or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be an officer or director or employee of the
Corporation and shall inure to the benefit of the heirs, executors, and
administrators of such a person.
<PAGE>
SECTION 3-A.7. INSURANCE. The Corporation may purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, trustee, officer, employee, or agent of another
corporation (domestic or foreign, nonprofit or for profit), partnership, joint
venture, trust or other enterprise, against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the corporation would have the obligation or the power to
indemnify him against such liability under the provisions of this Article III-A.
SECTION 3-A.8. VENUE. Any action by a person claiming
indemnification under this Article III-A, or by the Corporation, to determine
such claim for indemnification may be filed as to the Corporation and each such
person in Butler County, State of Ohio. The Corporation and (by claiming such
indemnification) each such person consent to the exercise of jurisdiction over
its or his person by the Court of Common Pleas of Butler County, Ohio.
The foregoing is in further amplification of Article Sixth of the
Articles of Incorporation.]
THE CORPORATION SHALL, TO THE FULL EXTENT PERMITTED BY THE GENERAL
CORPORATION LAW OF OHIO, INDEMNIFY ALL PERSONS WHOM IT MAY INDEMNIFY PURSUANT
HERETO.
ARTICLE V
CERTIFICATES
SECTION 5.1. Certificates evidencing the ownership of shares of
the Corporation shall be issued to those entitled to them by transfer or
otherwise. Each certificate for shares shall bear a distinguishing number, the
signature of the President or Chairman of the Board, and of the Secretary of the
Corporation, the corporate seal, and such recitals as may be required by law.
Such signatures and seal on the certificate may be facsimile signatures.
SECTION 5.2. Subject to any applicable provision of law or the
Articles, transfers of shares of the Corporation shall be made only upon its
books, upon surrender and cancellation of a certificate or certificates for the
shares so transferred. Any certificate so presented for transfer shall be
endorsed or shall be accompanied by separate written assignment or a power of
attorney, signed by the person appearing by the certificate to be the owner of
the shares represented thereby.
SECTION 5.3. Lost, Stolen, Destroyed, or Mutilated Certificates.
The Corporation may, in its discretion, upon evidence satisfactory to it of the
loss, theft, or destruction of any certificate for shares of the Corporation,
authorize the issuance of a new certificate in lieu thereof, and may, in its
discretion, require as a condition precedent to such issuance, the giving, by
the owner of such alleged lost, stolen, or destroyed certificate, of a bond of
indemnity, in form and amount, with surety, satisfactory to the Corporation,
against any loss or damage which may result to, or claim which may be made
against, the Corporation, or any transfer agent or registrar of its shares, in
connection with such alleged lost, stolen, or destroyed, or such new,
certificate. If any certificate for shares of the Corporation becomes worn,
defaced, or mutilated, the Corporation may, upon production and surrender
thereof, order that the same be canceled and that a new certificate be issued in
lieu thereof.
<PAGE>
ARTICLE VI
CORPORATE SEAL
SECTION 6.1. CORPORATE SEAL. The Chairman of the Board, the
President, Vice President, or Secretary or other officers designated by the
Board of Directors, shall have authority to affix the corporate seal to any
document requiring such seal, and to attest the same. [Such seal shall be
substantially in the following form.] THE SEAL OF THE CORPORATION SHALL BE SUCH
AS THE BOARD OF DIRECTORS MAY FROM TIME TO TIME DETERMINE.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1. FISCAL YEAR. The fiscal year of the Corporation
shall be the calendar year.
SECTION 7.2. EXECUTION OF INSTRUMENTS. All agreements, deeds,
conveyances, transfers, certificates, and any other documents may be signed on
behalf of the Corporation by the Chairman of the Board, or the President, or
such other designated officers that the Board may designate from time to time.
SECTION 7.3. RECORDS. The Articles of the Corporation, the [Code
of] AMENDED AND RESTATED Regulations and the proceedings of all meetings of the
shareholders, the Board of Directors, standing committees of the Board, shall be
recorded in appropriate minute books provided for the purpose. The minutes of
each meeting shall be signed by the Secretary or other officer appointed to act
as Secretary of the meeting.
ARTICLE VIII
[CODE OF REGULATIONS] AMENDMENT, ALTERATION OR REPEAL
SECTION 8.1. INSPECTION. A copy of the [Code of] AMENDED AND
RESTATED Regulations, with all amendments thereto, shall at all times be kept in
a convenient place at the office of the Corporation, and shall be open for
inspection during all business hours.
SECTION 8.2. AMENDMENTS. The [Code of] AMENDED AND RESTATED
Regulations may be amended, altered, repealed, or replaced [by an affirmative
vote of a majority of the shares empowered to vote thereon at any regular or
special meeting of the shareholders.] ONLY BY THE AFFIRMATIVE VOTE OF THE
HOLDERS OF AT LEAST TWO-THIRDS OF THE OUTSTANDING VOTING POWER OF THE
CORPORATION VOTING AS A SINGLE CLASS AT A MEETING OF SHAREHOLDERS CALLED FOR
SUCH PURPOSE, UNLESS SUCH AMENDMENT, ALTERATION, REPEAL OR REPLACEMENT IS
RECOMMENDED BY THE AFFIRMATIVE VOTE OF TWO-THIRDS OF THE WHOLE AUTHORIZED NUMBER
OF DIRECTORS, IN WHICH CASE THESE AMENDED AND RESTATED REGULATIONS MAY BE
AMENDED, ALTERED, REPEALED OR REPLACED BY THE AFFIRMATIVE VOTE OF THE HOLDERS OF
A MAJORITY OF THE OUTSTANDING VOTING POWER OF THE CORPORATION VOTING AS A SINGLE
CLASS AT A MEETING OF SHAREHOLDERS CALLED FOR SUCH PURPOSE.
