UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For quarter ended September 30, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-10602
MID-AMERICA BANCORP
(Exact name of registrant as specified in its charter)
KENTUCKY 61-1012933
(State or other jurisdiction of(I.R.S. Employer I.D. No.)
incorporation or organization)
500 West Broadway, Louisville, Kentucky 40202
(Address of principal executive offices)(Zip Code)
(502) 589-3351
(Registrant's telephone number, including area code)
NONE
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for a shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS: Indicate by check mark whether the
registrant has filed all documents and reports required to be filed by Section
12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court. Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares
outstanding of each of the issuer's classes of common stock, as of the latest
practicable date. October 26, 1995: 8,825,782 shares of common stock, no
par value
MID-AMERICA BANCORP
PART I. FINANCIAL INFORMATION
The consolidated financial statements of Mid-America Bancorp and
subsidiaries submitted herewith are unaudited. However, in the opinion of
management, all adjustments (consisting only of adjustments of a normal
recurring nature) necessary for a fair presentation of the results for the
interim periods have been made.
ITEM 1. FINANCIAL STATEMENTS
The following consolidated financial statements of Mid-America Bancorp
and subsidiaries are submitted herewith:
Consolidated balance sheets - September 30, 1995 and December 31, 1994
Consolidated statements of income - three and nine months ended
September 30, 1995 and 1994
Consolidated statements of changes in shareholders' equity - nine months
ended September 30, 1995 and 1994
Consolidated statements of cash flows - nine months ended September 30,
1995 and 1994
Notes to consolidated financial statements
MID-AMERICA BANCORP AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands except share and per share data) (Unaudited)
<TABLE>
<CAPTION>
September 30 December 31
----------- -------------
1995 1994
ASSETS ----------- -------------
<S> <C> <C>
Cash and due from banks $34,895 $64,215
Federal funds sold 30,900 5,300
Securities purchased under agreements to resell -- 65,000
Securities available for sale, amortized cost of $128,852 (1995)
and $134,656 (1994) (Note 4) 128,922 131,482
Securities held to maturity, market value of $186,602 (1995)
and $209,374 (1994) (Note 4) 185,409 214,313
Loans, net of unearned income of $25,946 (1995) and $29,966 (1994) 719,592 699,396
Allowance for loan losses (Note 5) (9,300) (7,045)
----------- -------------
Loans, net 710,292 692,351
Premises and equipment 19,489 19,098
Other assets 28,895 22,231
----------- -------------
TOTAL ASSETS $1,138,802 $1,213,990
=========== =============
LIABILITIES
Deposits:
Non-interest bearing $97,225 $96,590
Interest bearing 640,934 636,030
----------- -------------
Total deposits 738,159 732,620
Securities sold under agreements to repurchase 135,170 213,101
Federal funds purchased 4,170 5,800
Advances from the Federal Home Loan Bank 76,652 81,504
Money orders and similar payment instruments outstanding 47,632 47,818
Accrued expenses and other liabilities 8,993 8,095
----------- -------------
TOTAL LIABILITIES 1,010,776 1,088,938
SHAREHOLDERS' EQUITY
Preferred stock, no par value;
authorized - 750,000 shares; none issued -- --
Common stock, no par value, stated value $2.77 per
share; authorized - 12,000,000 shares; issued and outstanding -
8,824,722 shares (1995) and 8,803,759 shares (1994) 24,479 24,421
Additional paid-in capital 95,829 95,608
Retained earnings 7,673 7,086
Net unrealized securities gains (losses) (Note 4) 45 (2,063)
----------- -------------
TOTAL SHAREHOLDERS' EQUITY 128,026 125,052
----------- -------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $1,138,802 $1,213,990
=========== =============
See notes to consolidated financial statements.
/TABLE
<PAGE>
MID-AMERICA BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands except per share data) (Unaudited)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30 September 30
-------------------------- --------------------------
1995 1994 1995 1994
INTEREST INCOME: ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Interest and fees on loans $16,966 $15,863 $51,444 $45,360
Interest on securities:
U.S.Treasury and agencies 3,580 2,813 10,255 8,219
States and political subdivisions 176 99 479 253
Corporate and other 795 662 2,233 2,120
Interest on federal funds sold 560 485 1,953 999
Interest on securities purchased under agreements to resell 26 403 630 1,191
----------- ----------- ----------- -----------
Total interest income 22,103 20,325 66,994 58,142
----------- ----------- ----------- -----------
INTEREST EXPENSE:
Interest on deposits 7,433 5,900 21,715 17,298
Interest on federal funds purchased and
securities sold under agreements to repurchase 1,866 1,757 6,280 4,168
Interest on Federal Home Loan Bank advances 1,185 1,274 3,623 3,697
----------- ----------- ----------- -----------
Total interest expense 10,484 8,931 31,618 25,163
----------- ----------- ----------- -----------
Net interest income before provision for loan losses 11,619 11,394 35,376 32,979
Provision for loan losses (Note 5) 5,718 150 5,947 352
----------- ----------- ----------- -----------
Net interest income after provision for loan losses 5,901 11,244 29,429 32,627
----------- ----------- ----------- -----------
/TABLE
<PAGE>
MID-AMERICA BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (Cont'd)
(In thousands except per share data) (Unaudited)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30 September 30
-------------------------- --------------------------
1995 1994 1995 1994
NON-INTEREST INCOME: ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Income from trust department 242 353 695 1,031
Service charges on deposit accounts 1,135 1,186 3,342 3,365
Money order fees 912 707 2,690 2,102
Securities losses (18) -- (30) --
Other 665 583 1,855 1,729
----------- ----------- ----------- -----------
Total non-interest income 2,936 2,829 8,552 8,227
----------- ----------- ----------- -----------
OTHER OPERATING EXPENSES:
Salaries and employee benefits 5,730 5,349 16,888 15,770
Occupancy expense 801 688 2,282 1,983
Furniture and equipment expenses 1,257 1,078 3,696 3,226
Other (Note 6) 3,472 2,509 8,789 7,523
----------- ----------- ----------- -----------
Total other operating expenses 11,260 9,624 31,655 28,502
----------- ----------- ----------- -----------
Income (loss) before income taxes (2,423) 4,449 6,326 12,352
Income tax expense (benefit) (947) 1,371 1,771 3,739
----------- ----------- ----------- -----------
NET INCOME (LOSS) ($1,476) $3,078 $4,555 $8,613
=========== =========== =========== ===========
NET INCOME (LOSS) PER COMMON SHARE (Note 2) ($0.17) $0.35 $0.51 $0.97
=========== =========== =========== ===========
Weighted Average Number of Shares Outstanding 8,927 8,897 8,924 8,907
=========== =========== =========== ===========
See notes to consolidated financial statements.
/TABLE
<PAGE>
MID-AMERICA BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited)
<TABLE>
<CAPTION> Nine months ended
September 30
--------------------------
1995 1994
CASH FLOWS FROM OPERATING ACTIVITIES: ----------- -----------
<S> <C> <C>
Net income $4,555 $8,613
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation, amortization and accretion, net 3,590 4,115
Provision for loan losses 5,947 352
Federal Home Loan Bank stock dividend (642) (493)
Loss on sales of securities 30 --
Deferred taxes 930 785
Increase in interest receivable (975) (828)
Decrease (increase) in other assets (5,615) 3,028
Decrease in money orders and similar payment instruments outstanding (186) (12,445)
Increase (decrease) in other liabilities (1,158) 3,733
----------- -----------
Net cash provided by operating activities 6,476 6,860
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of securities available for sale (43,837) (23,944)
Proceeds from maturities of securities available for sale 35,866 10,423
Proceeds from sales of securities available for sale 13,591 --
Purchases of securities held to maturity (82,140) (30,899)
Proceeds from maturities of securities held to maturity 97,275 59,706
Proceeds from sales of securities held to maturity 12,982 --
Increase in customer loans (23,687) (33,161)
Proceeds from sales of premises and equipment 242 57
Payments for purchases of premises and equipment (2,916) (3,012)
----------- -----------
Net cash provided by (used in) investing activities 7,376 (20,830)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in deposits 5,539 (26,945)
Net decrease in securities sold under agreements to repurchase (77,931) (17,255)
Net decrease in federal funds purchased (1,630) (9,575)
Advances from the Federal Home Loan Bank -- 11,646
Repayment of advances from the Federal Home Loan Bank (4,852) (8,676)
Stock options exercised 270 380
Dividends paid (3,968) (3,841)
----------- -----------
Net cash used in financing activities (82,572) (54,266)
----------- -----------
Net decrease in cash and cash equivalents (68,720) (68,236)
Cash and cash equivalents at January 1 134,515 146,937
----------- -----------
Cash and cash equivalents at September 30 $65,795 $78,701
=========== ===========
</TABLE>
Non-cash transactions during the nine months ended September 30, 1994 included
a transfer of securities held to maturity to securities available for sale of
$13,848.
See notes to consolidated financial statements.
<PAGE>
MID-AMERICA BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(In thousands except per share data) (Unaudited)
<TABLE>
<CAPTION>
Nine months ended
September 30
------------------------------
1995 1994
-------------- -------------
<S> <C> <C>
Balance, January 1 $125,052 $119,590
Net income 4,555 8,613
Cash dividends declared ($.45 per share) (3,968) (3,841)
Stock options exercised, including related tax benefits 279 407
Net unrealized gains (losses) on securities available for sale, net of tax 2,108 (1,577)
-------------- -------------
Balance, September 30 $128,026 $123,192
============== =============
See notes to consolidated financial statements.
/TABLE
<PAGE>
MID-AMERICA BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. The accounting and reporting policies of Mid-America Bancorp and
its subsidiaries (the Company) conform with generally accepted
accounting principles and general practices within the banking
industry. The accompanying unaudited consolidated financial statements
should be read in conjunction with the Summary of Significant Accounting
Policies footnote which appears in the Company's 1994 Annual Report and
Form 10-K filed with the Securities and Exchange Commission.
2. All per share information in the consolidated financial statements
has been adjusted for the 3% stock dividend on November, 1994.
3. On January 1, 1995, the Company adopted FASB Statement
No. 114, "Accounting By Creditors for Impairment of a Loan," as
amended by FASB No. 118, "Accounting By Creditors for Impairment
of a Loan - Income Recognition and Disclosures." When adopted,
applying provisions of these new accounting standards did not require
an increase in the allowance for loan losses. The recorded investment
in impaired loans at September 30, 1995 was approximately $15 million.
Of these impaired loans, loans aggregating $7.5 million had a valuation
allowance of $2.1 million.
4. The amortized cost and market value of securities available for
sale are summarized as follows:
<TABLE>
<CAPTION>
September 30, 1995 December 31, 1994
---------------------- ------------------------
Amortized Market Amortized Market
Cost Value Cost Value
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
U.S. Treasury and agencies $99,702 $99,772 $110,213 $107,039
Corporate obligations 13,960 13,960 9,915 9,915
Equity securities 15,190 15,190 14,528 14,528
---------- ---------- ----------- -----------
$128,852 $128,922 $134,656 $131,482
========== ========== =========== ===========
</TABLE>
The book value and market value of securities held to maturity are
summarized as follows:
<TABLE>
<CAPTION>
September 30, 1995 December 31, 1994
---------------------- ------------------------
Book Market Book Market
Value Value Value Value
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
U.S. Treasury and agencies $163,176 $164,196 $189,223 $184,865
Obligations of states and political subdivisions 10,863 11,060 7,877 7,665
Corporate obligations 11,020 10,995 16,863 16,495
Equity securities and other 350 351 350 349
---------- ---------- ----------- -----------
$185,409 $186,602 $214,313 $209,374
========== ========== =========== ===========
/TABLE
<PAGE>
MID-AMERICA BANCORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited)
5. Allowance for Loan Losses - Changes in the allowance for loan losses
are as follows:
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
---------- -----------
<S> <C> <C>
Balance, January 1 $7,045 $6,578
Provision for Loan Losses 5,947 712
Recoveries 189 248
Loans charged off (3,881) (493)
---------- -----------
Balance, end of period $9,300 $7,045
========== ===========
</TABLE>
6. Other operating expense consists of the following:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
----------------------- ------------------------
1995 1994 1995 1994
---------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Operating supplies $434 $338 $1,465 $1,204
Legal and professional fees 778 261 1,167 627
Taxes - Bank shares, property and other 286 379 1,017 1,052
Deposit insurance (44) 420 764 1,222
Other 2,018 1,111 4,376 3,418
---------- ----------- ----------- -----------
$3,472 $2,509 $8,789 $7,523
========== =========== =========== ===========
</TABLE>
7. Financial Instruments - Interest Rate Swap Contracts
The Company, in part, manages its exposure to market risk by using
interest rate swap contracts to modify the existing interest rate
characteristics of its floating rate loan portfolio. The notional amount
of the intere rate swap contracts represents only an agreed-upon amount on
which calculations of interest payments to be exchanged are based, and is
significantly greater than the amount at risk. Credit risk is measured as
the cost of replacing, at current market rates, contracts in an unrealized
gain position. Although the Company is exposed to credit-related losses in
the event of non- performance by the counterparty, based on management's
assessment, as of September 30, 1995, the counterparty was expected to
meet its obligations. In addition, the Company deals exclusively with
counterparties with high credit ratings, enters into bilateral collateral
arrangements and arranges master netting agreements. These agreements
include legal rights of setoff that provide for the net settlement of the
subject contracts with the same counterparty in the event of default.
At September 30, 1995, the Company had entered into an interest rate swap
contract with a notional amount totaling $44 million. Under this contract,
the Company receives or pays the difference between the floating prime
rate and the fixed rate stated in the contract through the year 2000. At
September 30, 1995, the floating prime rate to be paid by the Company was
8.75% and the fixed rate to be received by the Company was 9.03%. Net
receipts or payments under the contract are recognized as adjustments to
interest income. At September 30, 1995, the positive fair value of the
interest rate swap contract, determined through market quotes, was
approximately $550,000.
<PAGE>
ITEM II. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This item discusses the results of operations for Mid-America Bancorp
and its subsidiaries for the three and nine months ended September 30, 1995
and compares those periods with the same periods of the previous year. In
addition, the discussion describes the significant changes in the financial
condition of the Company that have occurred between December 31, 1994 and
September 30, 1995. This discussion should be read in conjunction with the
consolidated financial statements and accompanying notes presented in Part I,
Item 1 of this report.
A. RESULTS OF OPERATIONS
The Company had a net loss for the quarter ended September 30, 1995 of
$1,476,000 or ($0.17) per share compared to net income of $3,078,000 or $0.35
per share for the same period last year. Year to date earnings were
$4,555,000 or $0.51 per share compared to $8,613,000 or $0.97 per share for
the first nine months of 1994.
The operating results for the third quarter and nine month period ended
September 30, 1995 reflect a significant provision for loan losses of $5.7
million primarily related to non-performing loans to a Louisville-based real
estate development firm. During the third quarter, management classified
these loans, aggregating $14.8 million, as impaired and non-accrual and
adjusted the carrying value of these loans to fair value through a combination
of charge-offs and an increase in the allowance for loan losses.
Net interest income
Net interest income is the difference between interest earned on earning
assets and interest expensed on interest bearing liabilities. The net
interest spread is the difference between the average yield on earning assets
and the average rate on interest bearing liabilities. The net yield on
earning assets (interest margin) is net interest income divided by average
earning assets. The following table summarizes the above for the three and
nine months ending September 30, 1995 and 1994.
In thousands except percentages
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Total interest income $22,103 $20,325 $66,994 $58,142
Tax equivalent adjustment 320 239 958 676
Tax equivalent interest income 22,423 20,564 67,952 58,818
Total interest expense 10,484 8,931 31,618 25,163
Tax equivalent net interest income $11,939 $11,633 $36,334 $33,655
Average rate on earning assets 8.33% 7.60% 8.40% 7.40%
Average rate on interest bearing liabilities 4.86% 4.01% 4.83% 3.83%
Net interest spread, annualized 3.47% 3.59% 3.57% 3.57%
Net interest margin, annualized 4.43% 4.30% 4.49% 4.24%
Average earning assets $1,068,554 $1,065,967 $1,080,001 $1,058,877
Average interest bearing liabilities $855,413 $884,648 $875,437 $878,492
</TABLE>
Net interest income and net interest margin have increased for both the three
and nine months ended September 30, 1995 compared to the comparable periods in
1994. The increases for 1995 compared to 1994 are primarily attributed to the
effect of higher interest rates. Over the last year, the Company's loan
portfolio, a significant portion of which is variable rate in nature, and the
short-term portion of the securities portfolio has repriced faster than
interest bearing liabilities. Volume increases in earning assets also
positively impacted the nine month period.
Allowance for Loan Losses and Provision for Loan Losses
The allowance for loan losses is maintained at a level adequate to
absorb probable losses. Management determines the adequacy of the allowance
based upon reviews of individual credits, evaluation of the risk
characteristics of the loan portfolio, including the impact of current
economic conditions on the borrowers' ability to repay, past collection and
loss experience and such other factors, which, in management's judgement,
deserve current recognition. The allowance for loan losses is established by
charges to operating earnings.
During the third quarter of 1995 the Company recorded a
provision for loan losses of $5.7 million attributed primarily to losses
associated with loans totaling approximately $14.8 million to a
Louisville-based real estate development firm, that were classified by
management as impaired and non-accrual and adjusted to fair value based on
appraisals of the underlying collateral. As of September 30, 1995,
charge-offs related to these loans aggregated approximately $2.9 million, and
the allowance for loan losses related to the remaining amount of these
impaired loans of $11.9 million, was approximately $1.9 million
An analysis of the changes in the allowance for loan losses and selected
ratios follows:
Dollars In thousands
<TABLE>
<CAPTION>
Nine Months Ended
September 30
1995 1994
<S> <C> <C>
Balance at January 1 $7,045 $6,578
Provision for loan losses 5,947 352
Net loan charge-offs, net of recoveries (3,692) (208)
Balance September 30 $9,300 $6,722
Average loans, net of unearned income $698,948 $672,580
Provision for loan losses to average loans 0.85% 0.05%
Allowance for loan losses to average loans 1.33% 1.00%
Allowance for loan losses to period-end loans 1.29% 0.97%
</TABLE>
On January 1, 1995, the Company adopted FASB Statement No, 114,
"Accounting By Creditors for Impairment of a Loan," as amended by FASB No.
118, "Accounting By Creditors for Impairment of a Loan - Income Recognition
and Disclosures." When adopted, applying provisions of these new accounting
standards did not require an increase in the allowance for loan losses and was
otherwise not significant.
Non-interest Income and Other Operating Expenses
The following table sets forth the major components of non-interest
income and other operating expenses for the three and nine months ending
September 30, 1995 and 1994:
<TABLE>
<CAPTION>
Three months ended Nine months ended
In thousands September 30 September 30
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Non-Interest Income:
Income from trust department $242 $353 $695 $1,031
Service charges on deposit accoun 1,135 1,186 3,342 3,365
Money order fees 912 707 2,690 2,102
Securities losses (18) --- (30) ---
Other 665 583 1,855 1,729
Total non-interest income $2,936 $2,829 $8,552 $8,227
Other Operating Expenses:
Salaries and employee benefits $5,730 $5,349 $16,888 $15,770
Occupancy expenses 801 688 2,282 1,983
Furniture and equipment expenses 1,257 1,078 3,696 3,226
Operating supplies 434 338 1,465 1,204
Legal and professional fees 779 261 1,167 627
Taxes-Bank shares, property and o 286 379 1,017 1,052
Deposit insurance (44) 420 764 1,222
Other 2,017 1,111 4,376 3,418
Total other operating expenses $11,260 $9,624 $31,655 $28,502
</TABLE>
Non-interest income increased $325,000 or 4% for the nine months ended
September 30, 1995 and increased $107,000 or 4% for the three months ended
September 30, 1995 when compared to the same periods in 1994. A favorable
change for the three and nine month periods is attributed to continuing volume
increases in the money order company subsidiary's business, which caused money
order fees to increase 29% and 28%, respectively. The decrease in Trust
Department income is attributed to lower volume in the stock transfer function
and the absence of non-recurring special project fees in 1995.
Other operating expenses increased $1.6 million and $3.2 million for the
three and nine month period ended September 30, 1995, respectively, compared
to the same periods in 1994. The most significant portion of the increase for
both periods is related to increases in salaries and benefits which increased
just over 7% for both periods. The increase in salaries is attributed to the
annual salary increases that were effective at the beginning of the year and
an increase in average full-time equivalent employees. Another factor
influencing the increase in salaries and benefits was an increase in health
insurance costs. Furniture and equipment related expenses increased 17% and
15%, for the three and nine-months ended September 30, 1995, respectively,
when compared to the same periods in 1994. These increases relate primarily
to increased depreciation and routine maintenance associated with improved
technology equipment and money order equipment additions. Occupancy expenses
increased approximately 16% and 15% for the three and nine-month periods,
respectively and reflected additional rent associated with expanded space at
the Company's main office facility and at the money order subsidiary's office
location. Legal and professional fees which increased approximately $500,000
for the three and nine months ended September 30, 1995, when compared to the
same periods in 1994, reflect increased legal costs associated with the
non-performing loan situation previously discussed. Deposit insurance costs
declined for both the three and nine months ended September 30, 1995, compared
to the same periods in 1994, as a result of the $450,000 refund of FDIC
insurance premiums associated with the reduction in deposit insurance rates.
Other expenses which increased approximately $900,000 for the quarter and
$950,000 for the nine months ended September 30, 1995, compared to the same
periods in 1994, include increased advertising costs associated with media
campaigns for products and corporate identity, losses associated with
collection of money order fees of approximately $150,000 and approximately
$500,000 of expenses related to estimated probable losses on certain legal
matters.
Income Taxes
The Corporation had an income tax benefit of $947,000 for the third
quarter of 1995 compared to income tax expense of $1,371,000 for the same
period in 1994. The year-to-date tax expense and effective tax rate were
$1,771,000 and 28.0% for 1995, respectively and $3,739,000 and 30.3% for 1994,
respectively. The lower effective tax rate in 1995 is attributed to tax
exempt income sources being a larger proportion of the reduced level of income
before taxes.
B. FINANCIAL CONDITION
Total assets decreased $75 million from December 31, 1994 to September
30, 1995, while average assets increased $15,143,000 or 1.3% to $1,152,652,000
for the third quarter of 1995 compared to the last quarter of 1994. During
the first nine months of 1995 average assets increased approximately $27
million compared to the comparable period in 1994. The increase in assets is
related to increases in the commercial loan portfolio. The earning asset
increase was primarily supported by increases in non-interest bearing sources
of funds (money orders and similar payment instruments outstanding). During
the first nine months of 1995, average interest bearing deposits increased
approximately 1%, while there was a shift from transaction accounts to time
deposits.
Nonperforming Loans and Assets
Nonperforming loans, which include nonaccrual and loans past due over 90
days, totaled $21,110,000 at September 30, 1995 and $3,511,000 at December 31,
1994. Impaired loans aggregated approximately $15,020,000 million at
September 30, 1995, including approximately $114,000 of loans not on a
nonaccrual basis. Nonperforming loans represent 2.93% of total loans at
September 30, 1995 compared to .50% at December 31, 1994. Included in
non-performing loans at September 30, 1995, in the past due over 90 days
category, is one loan of $5.3 million, that was in the process of renewal at
September 30, 1995 and was renewed on October 31, 1995. Management expects no
losses from this loan. Included in impaired loans is $7.5 million of impaired
loans for which the related allowance for loan losses is $2.1 million, and
$7.5 of impaired loans for which there is no allowance for loan losses. The
previously mentioned problem loans to a Louisville-based real estate
development firm which have been valued based on appraisals of the underlying
collateral, are included in impaired loans and total approximately $11.9
million.
Nonperforming assets, which include nonperforming loans and other real
estate owned, totaled $22,575,000 at September 30, 1995 and $5,896,000 at
December 31, 1994. This represents 1.98% of total assets at September 30,
1995 compared to 0.49% at December 31, 1994.
The Company considers the level of nonperforming loans in its evaluation
of the adequacy of the allowance for loan losses.
C. LIQUIDITY AND INTEREST SENSITIVITY
Liquidity represents the Company's ability to generate cash or otherwise
obtain funds at a reasonable price to satisfy commitments to borrowers as well
as demands of depositors. The loan and securities portfolios are managed to
provide liquidity through maturity or payments related to such assets.
Interest rate sensitivity management is managing the difference or gap
between rate sensitive assets and rate sensitive liabilities to minimize the
impact of changing interest rates on profitability and allow for adequate
liquidity.
The Company's adjusted one year cumulative interest sensitivity gap was
13.94% at September 30, 1995 compared to 15.92% at December 31, 1994. The
cumulative interest sensitivity gap through 90 days was 14.66% at September
30, 1995 compared to 11.70% at December 31, 1994. This asset and liability
structure and related interest sensitivity cause the Company's assets to
reprice faster than interest bearing liabilities. During the third quarter of
1995, the Company entered into an interest rate swap contract to reduce its
exposure to a decline in interest rates. At September 30, 1995, the Company
had interest rate swap contracts with a notional amount of $44 million, which
entitled the Company to receive a fixed interest rate of 9.03% and pay a
floating rate equal to the prime rate for a term of five years.
The parent company's liquidity depends primarily on the dividends paid
to it as the sole shareholder of the Mid-America Bank of Louisville and Trust
Company.
D. CAPITAL RESOURCES
At September 30, 1995, shareholders' equity totaled $128,026,000, an
increase of $2,974,000 since December 31, 1994. The increase is attributed to
net income less dividends, and appreciation in the value of securities
available for sale.
<TABLE>
<CAPTION>
Corporation Corporation Minimum
September December Required
30, 1995 31, 1994
<S> <C> <C> <C>
Leverage Ratio 11.22% 10.45% 3.00%
Tier I risk based capital ratio 15.59% 16.92% 4.00%
Total risk based capital ratio 16.72% 17.86% 8.00%
</TABLE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
10 (n) Material Contracts-Employment Agreement between Mid-America
Bancorp and R. K. Guillaume
27 Financial Data Schedule
(b) Reports on Form 8-K: In a report on Form 8-K dated September 18,
1995, the Company reported, under Item 5 of that form, an increase in
non-performing loans and related losses.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Mid-America Bancorp
(Registrant)
Date: November 14, 1995 By: /s/ Steven Small
Steven Small
Executive Vice President and
Chief Financial Officer
Date: November 14, 1995 By: /s/Orson Oliver
Orson Oliver
President
INDEX TO EXHIBITS
10 (n)Employment Agreement between Mid-America Bancorp and R. K.
Guillaume
27 Financial Data Schedule
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made and entered into as of the 2nd day of
October, 1995 by and between MID AMERICA BANCORP, INC., a
Kentucky corporation and MID AMERICA BANK OF LOUISVILLE & TRUST
COMPANY, a Kentucky Combined Bank and Trust Company, (together
with their successors and assigns permitted under this Agreement,
the "Companies), and R.K. GUILLAUME (the "Executive").
W I T N E S S E T H:
WHEREAS, the Companies desire to employ the Executive and to
enter into an agreement embodying the terms of such employment
(this "Agreement") and the Executive desires to enter into this
Agreement and to accept such employment, subject to the terms and
provisions of this Agreement:
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein and for other good and valuable
consideration, the receipt of which is mutually acknowledged, the
Companies and the Executive (individually a "Party" and together
the "Parties") agree as follows:
1. Definitions.
(a) "Affiliate" of a person or other entity shall mean a
person or other entity that directly or indirectly controls, is
controlled by, or is under common control with the person or
other entity specified.
(b) "Base Salary" shall mean the salary provided for in
Section 4 below or any increased salary granted to the Executive
pursuant to Section 4.
(c) "Board" shall mean the Boards of Directors of the
Companies.
(d) "Cause" shall mean:
(i) The Executive is convicted of a felony; or
(ii) The Executive is guilty of willful gross neglect
or willful gross misconduct in carrying out his duties under this
Agreement, resulting, in either case, in material economic harm
to a Company, unless the Executive believed in good faith that
such act or nonact was in the best interests of such Company.
(e) A "Change" shall mean the occurrence of any one of the
following events:
(i) Any "person," as such term is used in Sections
3(a)(9) and 13(d)of the Securities Exchange Act of 1923, becomes
a "beneficial owner,"as such term is used in Rule 13d-3
promulgated under that Act, of 20% or more of the Voting Stock of
a Company;
(ii) The majority of either Board consists of
individuals other than Incumbent Directors, which term means the
members of the Board on the date of this Agreement; provided that
any person becoming a director or subsequent to such date whose
election or nomination for election was supported by two-thirds
of the directors who then comprised the Incumbent Directors shall
be considered to be an Incumbent Director;
(iii) A Company adopts any plan of liquidation providing
for the distribution of all or substantially all of its assets;
(iv) All or substantially all of the assets or business
of a Company is disposed of pursuant to a merger, consolidation
or other transaction (unless the shareholders of such Company
immediately prior to such merger, consolidation or other
transaction beneficially own, directly or indirectly, in
substantially the same proportion as they owned the Voting Stock
of such Company, all of the Voting Stock or other ownership
interests of the entity or entities, if any, that succeed to the
business of such Company); or
(v) A Company combines with another company and is the
surviving corporation but, immediately after the combination, the
shareholders of such Company immediately prior to the combination
hold, directly or indirectly, 50% or less of the Voting Stock of
the combined company (there being excluded from the number of
shares held by such shareholders, but not from the Voting Stock
of the combined company, any shares received by Affiliates of
such other company in exchange for stock of such other company).
(f) "Constructive Termination Without Cause" shall mean a
termination of the Executive's employment at his initiative as
provided in Section 7(c) below following the occurrence, without
the Executive's prior written consent, of one or more of the
following events (except in consequence of a prior termination):
(i) A reduction in the Executive's then current Base
Salary or the termination or material reduction of any employee
benefit or perquisite enjoyed by him (other than as part of an
across-the-board reduction applicable to all executive officers
of the Companies);
(ii) The failure to elect or reelect the Executive to
any of the positions described in Section 3 below or removal of
him from any such position;
(iii) A material diminution in the Executive's duties or
the assignment to the Executive of duties which are materially
inconsistent with his duties or which materially impair the
Executive's ability to function as the Vice-Chairman of the
Boards (or as Chairman of the Boards and as the Chief Executive
Officer of the Companies when so elected) or any other office to
which he may be elected or appointed:
(iv) The failure to continue the Executive's
participation in any incentive compensation plan unless a plan
providing a substantially similar opportunity is substituted;
(v) The relocation of a Companies' principal office,
or the Executive's own office location as assigned to him by a
Company, to a location outside of the metropolitan area of
Louisville, Kentucky; or
(vi) The failure of a Company to obtain the assumption
in writing of its obligation to perform this Agreement by any
successor to all or substantially all of the assets of such
Company within 45 days after a merger, consolidation, sale or
similar transaction.
(g) "Disability" shall mean the Executive's inability to
substantially perform his duties and responsibilities under this
Agreement for a period of 180 consecutive days.
(h) "Subsidiary" of a Company shall mean any corporation of
which such Company owns, directly or indirectly, more than 50% of
the Voting Stock.
(i) "Term of Employment" shall mean the period specified in
Section 2 below.
(j) "Voting Stock" shall mean capital stock of any class or
classes having general voting power under ordinary circumstances,
in the absence of contingencies, to elect the directors of a
corporation.
2. Term of Employment.
The Companies hereby employ the Executive, and the Executive
hereby accepts such employment, for a five (5) year period
commencing October 2, 1995 and continuing until the termination
of his employment in accordance with the terms of this Agreement.
3. Position. Duties and Responsibilities.
(a) During the term of Employment, the Executive shall be
employed as the Vice Chairman (or as Chairman of the Boards and
Chief Executive Officer of the Companies when so elected) and be
responsible for the general management of the affairs of the
Companies. It is the intention of the parties that the Executive
shall be elected to and serve as a member of the Boards. The
Executive, in carrying out his duties under this Agreement, shall
report to the Boards.
(b) Anything herein to the contrary notwithstanding,
nothing shall preclude the Executive from (i) serving on the
boards of directors of a reasonable number of other corporations
(except Executive will not serve on the board of any other
financial institution) or the boards of a reasonable number of
trade associations and/or charitable organizations, (ii) engaging
in charitable activities and community affairs, and (iii)
managing his personal investments and affairs, provided that such
activities do not materially interfere with the proper
performance of his duties and responsibilities as the Companies'
Vice Chairman (or as Chairman of the Boards and Chief Executive
Officer when so elected) or any other office to which he may be
elected or appointed.
(c) Executive agrees that he will, consistent with Bank
policy, refrain during the term of his employment and while
receiving benefits hereunder from investing in any company that
is a customer of the Companies.
4. Base Salary.
The Executive shall be paid an annualized base Salary,
payable in accordance with the regular payroll practices of the
Companies, of $365,000.00. The Base Salary shall be reviewed no
less frequently than annually for increase at the sole discretion
of the Board and its Nominating and Executive Compensation
Committee.
5. Employee Benefit Programs.
During the Term of Employment, the Executive shall be
entitled to participate in all employee incentive, pension and
welfare benefit plans and programs made available to the
Companies' senior level executives or to its employees generally,
as such plans or programs may be in effect from time to time,
including without limitation, annual stock option grant, ESOP,
bonus, pension, profit sharing, savings and other retirement
plans or programs, medical, dental, hospitalization, short-term
and long-term disability and life insurance plans, accidental
death and dismemberment protection, travel accident insurance,
and any other pension or retirement plans or programs and any
other employee incentive compensation plan, employee welfare
benefit plans or programs that may be sponsored by the Companies
from time to time, including any plans that supplement the
above-listed types of plans or programs, whether funded or
unfunded.
6. Reimbursement of Business and Other Expenses.
The Executive is authorized to incur reasonable expenses in
carrying out his duties and responsibilities under this agreement
and the Companies shall promptly reimburse him for all business
expenses incurred in connection with carrying out the business of
the Companies, subject to documentation in accordance with the
Companies' policy.
7. Termination of Employment.
(a) Termination Due to Disability. In the event the
Executive's employment is terminated due to his Disability, he
shall be entitled in each case to the greater of the benefits
under the then current Companies disability benefits plan or the
following:
(i) An amount equal to the sum of 50% of Base Salary,
at the annual rate in effect at termination of his employment,
for a period ending with the end of the month in which he becomes
65, less the amount of any disability benefits provided to the
Executive by the Companies under any disability plan or social
security disability benefits;
(ii) The balance of any incentive awards earned (but
not yet paid);
(iii) The continued right to exercise any stock option
for the remainder of its term, such option to continue to become
exercisable in accordance with the schedule set forth in the
option;
(iv) Any pension benefit that may become due pursuant
to Section 5 above;
(v) Continued accrual of credited service for the
purpose of the pension benefit provided under Section 5 above
during the period of the Executive's Disability or, if sooner,
until the earlier of the Executive's election to commence
receiving his pension under Section 5 above or his attainment of
age 65;
(vi) Continued participation in medical, dental,
hospitalization and life insurance coverage and in all other
employee plans and programs in which he was participating on the
date of termination of his employment due to Disability until he
attains age 65; and
(vii) Other or additional benefits in accordance with
applicable plans and programs of the Companies.
If the Executive is precluded from continuing his
participation in any employee benefit plan or program a provided
in clause (vi) above, he shall be provided the after-tax economic
equivalent of the benefits provided under the plan or program in
which he is unable to participate. The economic equivalent of any
benefit foregone shall be deemed to be the lowest cost that would
be incurred by the Executive in obtaining such benefit himself on
an individual basis.
In no event shall a termination of the Executive's
employment for Disability occur unless the Party terminating his
employment gives written notice to the other Party in accordance
with Section 15 below.
(b) Termination by the Company for Cause.
(i) A termination for Cause shall not take effect
unless the provisions of this paragraph (i) are complied with.
The Executive shall be given written notice by the Board of the
intention to terminate him for Cause, such notice (A) to state in
detail the particular act or acts or failure or failures to act
that constitute the grounds on which the proposed termination for
Cause is based and (B) to be given within six months of the Board
learning of such act or acts or failure to act. The Executive
shall have 10 days after the date that such written notice has
been given to the Executive in which to request a hearing before
the Board. Such hearing shall be held within 15 days of such
notice to the Executive, provided he requests such hearing.
(ii) In the event the Companies terminate the
Executive's employment for Cause, he shall be entitled to:
(A) The Base Salary through the date of the
termination of his employment for Cause;
(B) Any incentive awards earned (but not yet
paid);
(C) Any pension benefit that may become due
pursuant to Section 5 above, determined as of the date of such
termination;
(D) Other or additional benefit in accordance
with applicable plans or programs of the Companies to the date of
termination.
(c) Termination Without Cause or Constructive
Termination Without Cause. In the event the Executive's
employment is terminated without Cause, other than due to
Disability or death, or in the event there is a Constructive
Termination Without Cause, the Executive shall be entitled to:
(i) The Base Salary through the date of
termination of the Executive's employment;
(ii) The Base Salary, at the annualized rate in
effect on the date of termination of the Executive's employment
(or in the event a reduction in Base Salary is the basis for a
Constructive Termination Without Cause, then the Base Salary in
effect immediately prior to such reduction), for a period of 36
months following such termination; provided that at the
Executive's option the Companies shall pay him the present value
of such salary continuation payments in a lump sum (using as the
discount rate the Applicable Federal Rate for short term Treasury
obligations as published by the Internal Revenue Service for the
month in which such termination occurs);
(iii) The balance of any incentive awards earned
(but not yet paid);
(iv) The right to exercise any stock option in
full, whether or not such right is exercisable pursuant to the
terms of the grant.
(v) Any pension benefit that may become due
pursuant to Section 5 above;
(vi) Continued accrual of credited service for the
purpose of the pension benefit provided under Section 5 above for
the period of 36 months or his attainment of age 65, whichever
shall first occur;
(vii) Continued participation in all medical,
dental, hospitalization and life insurance coverage and in other
employee benefit plans or programs in which he was participating
on the date of the termination of his employment until the
earlier of:
(A) The end of the period during which he is
receiving salary continuation payments (or in respect of which a
lump-sum severance payment is made);
(B) The date, or dates, he receives
equivalent coverage and benefits under the plans and programs of
a subsequent employer (such coverages and benefits to be
determined on a coverage-by-coverage, or benefit-by-benefit,
basis); provided that (x) if the Executive is precluded from
continuing his participation in any employee benefit plan or
program as provided in this clause (ix) of this Section 7(c), he
shall be provided with the after-tax economic equivalent of the
benefit provided under the plan or program in which he is unable
to participate for the period specified in this clause (ix) of
this Section 7(c), (y) the economic equivalent of any benefit
foregone shall be deemed to be the lowest cost that would be
incurred by the Executive in obtaining such benefit himself on an
individual basis, and (z) payment of such after-tax economic
equivalent shall be made quarterly in advance; and
(viii) Other or additional benefits in
accordance with applicable plans and programs of the Companies to
the date of termination.
(d) Termination of Employment Following a Change in
Control. If following a change in Control, the Executive's
employment is terminated without Cause or there is a Constructive
Termination Without Cause, the Executive shall be entitled to the
payments and benefits provided in Section 7(c), provided that the
salary continuation payments shall be paid in a lump sum without
any discount. Also, immediately following a Change in Control,
all amounts, entitlements or benefits in which he is not yet
vested shall become fully vested except to the extent such
vesting would be inconsistent with the terms of the relevant
plan.
(e) Voluntary Termination. In the event of a
termination of employment by the Executive on his own initiative
other than a termination due to death or Disability or a
Constructive Termination without Cause, the Executive shall have
the same entitlements as provided in Section 7(b)(ii) for a
Termination for Cause. A voluntary termination under this
Section 7(e)shall be effective upon 30 days prior notice to a
Company and shall not be deemed a breach of this Agreement.
(f) Limitation Following a Change in Control. In the
event that the termination of the Executive's employment is for
one of the reasons set forth in Section 7(e) above and the
aggregate of all payments or benefits made or provided to the
Executive under Section 7(d) above and under all other plans and
programs of the Companies (the "Aggregate Payment") is determined
to constitute a Parachute Payment, as such term is defined in
Section 280G(b)(2) of the Internal Revenue Code of 1986, as
amended (the "Code"), notwithstanding any other provision of this
Agreement to the contrary the aggregate amount of payments or
benefits paid by the Companies to the Executive pursuant to this
Agreement, the amount to be paid to the Executive and the time of
payment pursuant to this Section 7(f) shall be adjusted so as to
make such payments fully deductible by a Company. If the parties
are unable to agree upon an Auditor to calculate such an
adjustment, then the Executive and Companies shall each select
one accounting firm and those two firms shall jointly select the
accounting firm to serve as the Auditor.
(g) No Mitigation: No Offset. In the event of any
termination of employment under this Section 7, the Executive
shall be under no obligation to seek other employment and there
shall be no offset against amounts due the Executive under this
Agreement on account of any remuneration attributable to any
subsequent employment that he may obtain except as specifically
provided in this Section 7.
(h) Nature of Payments. Any amounts due under this
Section 7 are in the nature of severance payments considered to
be reasonable by the Companies and are not in the nature of a
penalty.
8. Non-Competition. The Executive agrees that he will not
from the date hereof and continuing while he is receiving any
salary or other benefits from the Companies pursuant to the terms
hereof, directly or indirectly, own, manage, operate, control or
participate in the ownership, management, operation or control of
any business in the Louisville metropolitan area which is in
competition with any business being conducted by the Companies.
Executive acknowledges that his breach of the
non-competition agreement contained in this paragraph 8 will
result in irreparable injury to the Companies and their
affiliates, and that the Companies and their affiliates' remedy
at law for such a breach will be inadequate. Accordingly, the
Executive agrees and consents that the Companies or any of their
affiliates, in addition to all other remedies available to them
at law and in equity, shall be entitled to seek both preliminary
and permanent injunctions to prevent and/or halt a breach or
threatened breach by the Executive of the covenant contained in
this paragraph 8. If any provision of this paragraph 8 is
determined by a court of competent jurisdiction to be invalid in
whole or in part, it shall be deemed to have been amended,
whether as to time, area covered, or otherwise, as and to the
extent required for its validity under applicable law and as so
amended shall be enforceable.
9. Indemnification.
(a) The Companies agree that if the Executive is made a
party, or is threatened to be made a party, to any action, suit
or proceeding, whether civil, criminal, administrative or
investigative (a "Proceeding"), by reason of the fact that he is
or was a director, officer or employee of the Companies or is or
was serving at the request of the Companies as a director,
officer, member, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including
service with respect to employee benefit plans, whether or not
the basis of such Proceeding is the Executive's alleged action in
an of official capacity while sewing as a director, officer,
member, employee or agent, the Executive shall be indemnified and
held harmless by the Companies to the fullest extent permitted or
authorized by the Companies' certificates of incorporation or
bylaws or, if greater, by the laws of the State of Kentucky,
against all cost, expense, liability and loss (including, without
limitation, reasonable attorney's fees, judgments, fines, ERISA,
excise taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by the Executive in
connection therewith, and such indemnification shall continue as
to the Executive even if he has ceased to be a director, member,
employee or agent of the Companies or other entity and shall
inure to the benefit of the Executive's heirs, executors and
administrators. The Companies shall advance to the Executive all
reasonable costs and expenses incurred by him in connection with
a Proceeding within 20 days after receipt by a Company of a
written request for such advance. Such request shall include an
undertaking by the Executive to repay the amount of such advance
if it shall ultimately be determined that he is not entitled to
be indemnified against such costs and expenses.
(b) Neither the failure of a Company (including its board
of directors, independent legal counsel or stockholders) to have
made a determination prior to the commencement of any proceeding
concerning payment of amounts claimed by the Executive under
Section 8(a) that indemnification of the Executive is proper
because he has met the applicable standard of conduct, nor a
determination by a Company (including its board of directors,
independent legal counsel or stockholders) that the Executive has
not met such applicable standard of conduct, shall create a
presumption that the Executive has not met the applicable
standard of conduct.
(c) The Companies agree to continue and maintain a
directors' and officers' liability insurance policy covering the
Executive to the extent either Company provides such coverage for
its other executive officers.
10. Representation.
The Companies represent and warrant that they are fully
authorized and empowered to enter into this Agreement and that
the performance of their obligations under this Agreement will
not violate any agreement between it and any other person, form
or organization.
11. Entire Agreement.
This Agreement contains the entire understanding and
agreement between the Parties concerning the subject matter
hereof and supersedes all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or
oral, between the Parties with respect thereto.
12. Amendment or Waiver.
No provision in this Agreement may be amended unless such
amendment is agreed to in writing and signed by the Executive and
an authorized officer of the Companies. No waiver by either Party
of any breach by the other Party of any condition or provision
contained in this Agreement to be performed by such other Party
shall be deemed a waiver of a similar or dissimilar condition or
provision at the same or any prior or subsequent time. Any waiver
must be in writing and signed by the Executive or an authorized
officer of the Companies, as the case may be.
13. Severability.
In the event that any provision or portion of this Agreement
shall be determined to be invalid or unenforceable for any
reason, in whole or in part, the remaining provisions of this
Agreement shall be unaffected thereby and shall remain in full
force and effect to the fullest extent permitted by law.
14. Survivorship.
The respective rights and obligations of the Parties
hereunder shall survive any termination of the Executive's
employment to the extent necessary to the intended preservation
of such rights and obligations.
15. Resolution of Disputes.
Any disputes arising under or in connection with this
Agreement shall, at the election of the Executive or the
Companies, be resolved by binding arbitration, to be held in
Kentucky in accordance with the rules and procedures of the
American Arbitration Association. Judgment upon the award
rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof. Costs of the arbitration or litigation,
including, without limitation, attorneys' fees of both Parties,
shall be borne by the Companies, provided that if the
arbitrator(s) determine that the claims or defenses of the
Executive were without any reasonable basis, each Party shall
bear his or its own costs.
16. Notices.
Any notice given to a party shall be in writing and shall be
deemed to have been given when delivered personally or sent by
certified or registered mail, postage prepaid, return receipt
requested, duly addressed to the Party concerned at the address
indicated below or to such changed address as such Party may
subsequently give such notice of:
If to the Companies: Mid-America Bancorp, Inc.
P.O. Box 1101
Louisville, KY 40201-1101
Attention: Bertram W. Klein
If to the Executive: R.K. Guillaume
415 Rolling Lane
Louisville. KY 40207
17. Headings.
The headings of the sections contained in this Agreement are
for convenience only and shall not be deemed to control or affect
the meaning or construction of any provision of this Agreement.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first written above.
MID-AMERICA BANCORP, INC.
By: /s/Bertram W. Klein
Title: Chairman of the Board
MID-AMERICA BANK OF LOUISVILLE &
TRUST COMPANY
By: /s/Bertram W. Klein
Title: Chairman of the Board
/s/ R. K. Guillaume
Name: R. K. Guillaume
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1000
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JUL-01-1995
<PERIOD-END> SEP-30-1995
<PERIOD-TYPE> 3-MOS
<CASH> 34,895
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 30,900
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<INVESTMENTS-HELD-FOR-SALE> 128,922
<INVESTMENTS-CARRYING> 185,409
<INVESTMENTS-MARKET> 186,602
<LOANS> 719,592
<ALLOWANCE> (9,300)
<TOTAL-ASSETS> 1,138,802
<DEPOSITS> 738,159
<SHORT-TERM> 139,340
<LIABILITIES-OTHER> 56,625
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0
0
<COMMON> 24,479
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<INCOME-PRETAX> (2,423)
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