FOOTHILL INDEPENDENT BANCORP, DEF 14A, 1998-04-14

FOOTHILL INDEPENDENT BANCORP
DEF 14A, 1998-04-14
STATE COMMERCIAL BANKS

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<PAGE> 1

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only
[X] Definitive Proxy Statement (as permitted by Rule 14a-6(e)(2)
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>

FOOTHILL INDEPENDENT BANCORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

FOOTHILL INDEPENDENT BANCORP
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.

[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:

----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):

----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:

----------------------------------------------------------------------
(5) Total fee paid:

----------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:

----------------------------------------------------------------------
(3) Filing Party:

----------------------------------------------------------------------
(4) Date Filed:

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<PAGE> 2

FOOTHILL INDEPENDENT BANCORP

April 14, 1998

Dear Shareholder:

The Board of Directors joins me in extending to you a cordial invitation to
attend the Annual Meeting of Shareholders of Foothill Independent Bancorp which
will be held on Tuesday, May 12, 1998, at 4:30 P.M., at THE GLENDORA COUNTRY
CLUB, 310 S. AMELIA AVENUE, Glendora, California.

In addition to the matters to be acted on at the meeting, which are
described in detail in the attached Notice of Annual Meeting and Proxy
Statement, there will be a discussion of the operations of the Company and its
wholly-owned subsidiary, Foothill Independent Bank. Since your participation in
Company activities is important, I hope you will be able to attend.

Whether or not you plan to attend the meeting, please be sure to complete,
sign, date and return the proxy card enclosed with the Proxy Statement so that
your shares may be voted in accordance with your wishes.

Sincerely,

George E. Langley
President and Chief Executive Officer

================================================================================
510 South Grand Ave. [ ] Glendora, California 91741 [ ] (626) 963-8551 [
] (909) 599-9351
<PAGE> 3

FOOTHILL INDEPENDENT BANCORP
510 SOUTH GRAND AVENUE
GLENDORA, CALIFORNIA 91741

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 12, 1998

TO THE SHAREHOLDERS OF FOOTHILL INDEPENDENT BANCORP:

The 1998 Annual Meeting of Shareholders of Foothill Independent Bancorp
(the "Company") will be held at THE GLENDORA COUNTRY CLUB, 310 S. AMELIA AVENUE,
Glendora, California, on Tuesday, May 12, 1998, at 4:30 P.M., for the following
purposes as more fully described in the accompanying Proxy Statement:

(1) To elect the three nominees named in the accompanying Proxy Statement
to serve as directors for a term of two years.

(2) To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.

Only shareholders of record at the close of business on April 3, 1998 will
be entitled to vote at the meeting or any adjournment or postponement thereof.

The Bylaws of the Company set forth the following procedures for
nominations to the Board of Directors:

Nominations for election of members of the board of directors may be made
by the board of directors or by any shareholder of any outstanding class of
capital stock of the corporation entitled to vote for the election of directors.
Notice of intention to make any nominations (other than for persons named in the
notice of the meeting at which such nomination is to be made) shall be made in
writing and shall be delivered or mailed to the president of the corporation by
the later of the close of business 21 days prior to any meeting of shareholders
called for the election of directors or 10 days after the date of mailing of
notice of the meeting to shareholders. Such notification shall contain the
following information to the extent known to the notifying shareholder: (a) the
name and address of each proposed nominee; (b) the principal occupation of each
proposed nominee; (c) the number of shares of capital stock of the corporation
owned by each proposed nominee; (d) the name and residence address of the
notifying shareholder; (e) the number of shares of capital stock of the
corporation owned by the notifying shareholder; (f) the number of shares of
capital stock of any bank, bank holding company, savings and loan association or
other depository institution owned beneficially by the nominee or by the
notifying shareholder and the identities and location of any such institutions;
and (g) whether the proposed nominee has ever been convicted of or pleaded nolo
contendere to any criminal offense involving dishonesty or breach of trust,
filed a petition in bankruptcy or been adjudged bankrupt. The notice shall be
signed by the nominating shareholder and by the nominee. Nominations not made in
accordance herewith shall be disregarded by the chairman of the meeting, and
upon his instructions, the inspector of elections shall disregard all votes cast
for each such nominee. The restrictions set forth in this paragraph shall not
apply to nomination of a person to replace a proposed nominee who has died or
otherwise become unable to serve as a director between the last day for giving
notice in accordance with this paragraph and the date of election of directors
if the procedure called for in this paragraph was followed with respect to the
nomination of the proposed nominee.

By order of the Board of Directors

George E. Langley
President and Chief Executive Officer

April 14, 1998

YOUR VOTE IS IMPORTANT. THEREFORE, WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING YOU SHOULD DATE, SIGN AND RETURN THE ENCLOSED PROXY. IF YOU ATTEND THE
MEETING, YOU WILL BE ENTITLED TO VOTE IN PERSON IF YOU WISH.
<PAGE> 4

PROXY STATEMENT
OF

FOOTHILL INDEPENDENT BANCORP
510 SOUTH GRAND AVENUE
GLENDORA, CALIFORNIA 91741

INTRODUCTION

This Proxy Statement is being furnished in connection with the solicitation
of proxies by the Board of Directors of Foothill Independent Bancorp, a
California corporation (the "Company"), for use at its 1998 Annual Meeting of
Shareholders to be held on Tuesday, May 12, 1998, at 4:30 P.M., at The Glendora
Country Club, 310 S. Amelia Avenue, Glendora, California, and at any adjournment
or postponement thereof (the "meeting"). It is contemplated that this
solicitation of proxies will be made exclusively by mail; however, if it should
appear desirable to do so to ensure adequate representation at the meeting,
directors, officers and employees of the Company or its wholly-owned subsidiary,
Foothill Independent Bank (the "Bank"), may communicate with shareholders,
brokerage houses and others by telephone, telegraph or in person, to request
that proxies be furnished and may reimburse banks, brokerage houses, custodians,
nominees and fiduciaries for their reasonable expenses in forwarding proxy
materials to the beneficial owners of the shares held by them. All expenses
incurred in connection with this solicitation will be borne by the Company.

Holders of shares of common stock of the Company ("shareholders") who
execute proxies retain the right to revoke them at any time before they are
voted. Any proxy given by a shareholder may be revoked or superseded by
executing a later dated proxy, or by giving notice of revocation to the
Secretary of the Company, 510 South Grand Avenue, Glendora, California 91741, in
writing prior to or at the meeting or by attending the meeting and voting in
person. A proxy, when executed and not so revoked, will be voted in accordance
with the instructions given in the proxy. If a choice is not specified in the
proxy, the proxy will be voted "FOR" the nominees for election of directors
named in this Proxy Statement. This Proxy Statement is first being mailed to
shareholders on or about April 14, 1998.

VOTING SECURITIES

The shares of common stock constitute the only outstanding class of voting
securities of the Company. Only the shareholders of the Company of record as of
the close of business on April 3, 1998 (the "Record Date"), will be entitled to
vote at the meeting or any adjournment or postponement thereof. As of April 3,
1998, there were 5,128,079 shares of common stock outstanding and entitled to
vote. A majority of the outstanding shares will constitute a quorum at the
Annual Meeting. Shareholders who abstain on any proposal or withhold authority
to vote on the election of directors will be counted in determining the presence
of a quorum; whereas broker non-votes will not be counted in determining the
presence of a quorum. Each shareholder is entitled to one vote for each share
held as of the Record Date, except that in the election of directors each
shareholder may cumulate his or her votes and give any one nominee a number of
votes equal to the number of directors to be elected multiplied by the number of
shares which the shareholder is entitled to vote at the meeting, or to
distribute the votes on the same principle among as many candidates as the
shareholder may choose, if (i) the name of the candidate for whom such votes are
cast has been properly placed in nomination prior to the voting, and (ii) any
shareholder has given notice at the meeting prior to voting of that
shareholder's intention to cumulate his or her votes.
<PAGE> 5

PRINCIPAL SHAREHOLDERS

Set forth below is certain information as of April 3, 1998 regarding the
number of shares of the Company's common stock owned by any person who was known
by the Company to own more than 5% of the voting securities of the Company, by
each of the executive officers of the Company named in the Summary Compensation
Table (the "Named Officers") and by all directors and executive officers as a
group:

<TABLE>
<CAPTION>
AMOUNT
AND
NATURE OF
NAME AND ADDRESS BENEFICIAL PERCENT
TITLE OF CLASS OF BENEFICIAL OWNER OWNERSHIP OF CLASS
-------------- ----------------------------- ---------- --------
<S> <C> <C> <C>
Common Stock, no par value Basswood Partners, L.P.(1) 428,978 8.37%
Matthew Lindenbaum
Bennett Lindenbaum
52 Forest Avenue
Paramus, NJ 07652
Common Stock, no par value William V. Landecena(2) 314,319(3) 6.05%
510 South Grand Avenue
Glendora, CA 91741
Common Stock, no par value George E. Langley(4) 171,233(5) 3.29%
510 South Grand Avenue
Glendora, CA 91741
Common Stock, no par value Tom Kramer(6) 102,730(7) 1.98%
510 South Grand Avenue
Glendora, CA 91741
Common Stock, no par value Donna Miltenberger(8) 69,859(9) 1.35%
510 South Grand Avenue
Glendora, CA 91741
Common Stock, no par value All Directors and Executive 1,270,100(10) 22.45%
Officers of the Company
as a group (10 in number)
</TABLE>

- ---------------
(1) Based on information set forth in a Schedule 13D, filed with the Securities
and Exchange Commission on September 30, 1997.

(2) Mr. Landecena is Chairman of the Board of Directors and is a Director of
the Company and the Bank.

(3) Includes 67,122 shares of common stock subject to outstanding stock options
exercisable during the 60-day period ending June 3, 1998.

(4) Mr. Langley is President, Chief Executive Officer and a Director of the
Company and the Bank.

(5) Includes 75,971 shares of common stock subject to outstanding stock options
exercisable during the 60-day period ending June 3, 1998.

(6) Mr. Kramer is Executive Vice President and Secretary of the Company and the
Bank.

(7) Includes 51,262 shares of common stock subject to outstanding stock options
exercisable during the 60-day period ending June 3, 1998.

(8) Ms. Miltenberger is Executive Vice President and Chief Operating Officer of
the Company and the Bank.

(9) Includes 46,554 shares of common stock subject to outstanding stock options
exercisable during the 60-day period ending June 3, 1998.

(10) Includes an aggregate of 530,737 shares of common stock subject to
outstanding stock options exercisable during the 60-day period ending June
3, 1998.

2
<PAGE> 6

ELECTION OF DIRECTORS

At the 1998 Annual Meeting, shareholders will vote on the election of three
Class I directors to serve on the Board of Directors for a two-year term ending
in 2000 and until their successors are elected and have been qualified. The
enclosed proxy will be voted in favor of the election to the Board of Directors
of all of the three nominees named below, unless a contrary instruction is given
in the proxy. All three of the nominees named below are incumbent directors of
the Company that were elected by the shareholders of the Company for terms that
expire in 1998. Each of the nominees named below also serve as a director of the
Bank, a wholly-owned subsidiary of the Company.

Under California law, the three nominees receiving the highest number of
votes will be elected as directors at the Annual Meeting. As a result, proxies
voted to "Withhold Authority," which will be counted, and broker non-votes,
which will not be counted, will have no practical effect. Discretionary
authority to cumulate votes represented by proxies is solicited by the Board of
Directors because, in the event nominations are made in opposition to the
nominees of the Board of Directors, it is the intention of the persons named as
proxy holders in the enclosed Proxy to cumulate votes represented by proxies for
individual nominees in accordance with their best judgment in order to assure
the election of as many of the nominees named below to the Board of Directors as
possible.

If any nominee becomes unavailable to serve on the Board of Directors of
the Company for any reason before the election, then the enclosed proxy will be
voted for the election of such substitute nominee or nominees, if any, as shall
be designated by the Board of Directors. The Board of Directors has no reason to
believe that any of the nominees will be unavailable to serve.

The names and certain information concerning the three (3) nominees for
election as directors are set forth below. YOUR BOARD OF DIRECTORS RECOMMENDS
THAT YOU VOTE "FOR" THE ELECTION OF EACH OF THE NOMINEES NAMED BELOW. Also set
forth below is information concerning each of the other current directors with
unexpired terms who will continue in office.

DIRECTORS AND NOMINEES

3
<PAGE> 7

<TABLE>
<CAPTION>
SHARES OF
DIRECTOR COMMON STOCK
OF THE BENEFICIALLY
COMPANY OWNED AS OF PERCENT PRINCIPAL OCCUPATION
NAME AND POSITIONS AGE SINCE(1) APRIL 3, 1998 OF CLASS AND BUSINESS EXPERIENCE
------------------ --- -------- ------------- -------- -----------------------
<S> <C> <C> <C> <C> <C>
Max E. Williams 53 1995 57,057(2) 1.10% Mr. Williams is a licensed architect
Director of the Company with a Bachelor's degree in
and the Bank Architecture and a Master's degree in
Urban and Regional Planning. He is,
and since 1979 has been, the owner
and president of his own architec-
tural firm. Prior to 1979, Mr.
Williams was employed as an architect
by independent real estate
development and architectural firms,
including Lewis Development Company
and William L. Pereira Associates.
Mr. Williams also is a member, and
past president of the Inland
California Chapter, of the American
Institute of Architects.
CLASS II DIRECTORS
Richard H. Barker 62 1993 80,839(2) 1.56% For 24 years, until his retirement in
Director of the Company June 1992, Mr. Barker held various
and the Bank management positions with City
National Bank in Beverly Hills,
California. His most recent position
was Senior Vice President in charge
of sales and trading in the
Investment Department.
Charles G. Boone 75 1973 191,879(2) 3.70% Mr. Boone is, and for more than the
Director of the Company past five years has been, a private
and the Bank engineering consultant in the area of
cryogenic engineering. Prior to 1984,
Mr. Boone was affiliated with the
engineering firm of Linhardt &
Associates.
William V. Landecena 73 1973 314,319(2) 6.05% Prior to his retirement in 1981, Mr.
Chairman of the Board of Landecena had been a partner for a
Directors and a Director number of years in the Arrow Meat
of the Company and the Company.
Bank
O. L. Mestad 75 1973 222,231(2) 4.28% Dr. Mestad is a private investor.
Director of the Company Prior to his retirement in 1983, Dr.
and the Bank Mestad had been engaged in the
private practice of dentistry for
more than twenty years. From May 1987
until May 1992, Dr. Mestad served as
Chairman of the Board of Directors of
the Company and the Bank, having been
elected to that position by the other
members of the Board of Directors.
</TABLE>

- ---------------
* Less than 1%

(1) All dates are the dates when the named individuals first became directors of
the Bank, the Company's predecessor and wholly owned subsidiary.

(2) Includes shares subject to outstanding options exercisable during the 60-day
period ending June 3, 1998, as follows: Mr. Langley -- 75,971 shares; Mr.
Tessitor -- 42,900 shares; Mr. Williams -- 51,975 shares; Mr.
Barker -- 59,969 shares; Mr. Boone -- 64,087 shares; Mr. Landecena -- 67,122
shares; and Mr. Mestad -- 69,917 shares.

The Board of Directors of the Company held sixteen meeting during the year
ended December 31, 1997. Each incumbent Director attended at least 75% of the
aggregate of the number of meetings of the Board and the number of meetings held
by all committees of the Board on which he served.

There are no family relationships among any of the directors or executive
officers of the Company.

4
<PAGE> 8

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Based upon information made available to the Company, the Company believes
that all filing requirements under Section 16(a) of the Securities Exchange Act
of 1934 applicable to its directors, officers and any persons holding 10 percent
or more of the Company's common stock were satisfied with respect to the
Company's fiscal year ended December 31, 1997.

COMMITTEES OF THE BOARD OF DIRECTORS

The Board of Directors of the Bank has established an Examining and Audit
Committee and a Compensation Committee. The Board of Directors of the Company
has not established any such committees.

The Examining and Audit Committee is comprised of five directors selected
by the Board of Directors of the Bank. The members of the Examining and Audit
Committee are O. L. Mestad, Richard H. Baker, William V. Landecena, Douglas F.
Tessitor and Max E. Williams. The Examining and Audit Committee is authorized to
handle all matters which it deems appropriate regarding the independent
accountants for the Company and the Bank and to otherwise communicate and act
upon matters relating to the review and audit of their books and records,
including the scope of the annual audit and the accounting methods and systems
to be utilized by the Company and the Bank. In addition, the Examining and Audit
Committee also makes recommendations to the Board of Directors with respect to
the selection of the independent accountants for the Company and the Bank. The
Examining and Audit Committee held eight meetings during the year ended December
31, 1997.

The Compensation Committee is comprised of five directors selected by the
Board of Directors of the Bank. The members of the Committee are William V.
Landecena, O. L. Mestad, Richard H. Barker, Douglas F. Tessitor and Max E.
Williams. The Compensation Committee makes determinations with respect to
compensation to be paid to the officers and other key employees of the Bank and
is responsible for establishing compensation and fringe benefit programs for the
employees of the Bank. The Compensation Committee held three meetings during the
year ended December 31, 1997.

The Company does not have a nominating committee. Instead, the Board of
Directors, as a whole, identifies and screens candidates for membership on the
Boards of Directors of the Company and the Bank.

5
<PAGE> 9

COMPENSATION OF EXECUTIVE OFFICERS

The following table sets forth compensation received for the three fiscal
years ended December 31, 1997 by the Company's and the Bank's executive officers
whose salary and bonus exceeded $100,000 (the "Named Officers").

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------------------------
AWARDS PAYOUTS
ANNUAL COMPENSATION ------------- --------------
----------------------------- LONG-TERM
NAME AND BONUS STOCK OPTIONS INCENTIVE PLAN ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) ($)(1) (SHARES) PAYMENTS COMPENSATION
------------------ ---- --------- -------- ------------- -------------- ------------
<S> <C> <C> <C> <C> <C> <C>
George E. Langley........... 1997 $235,048(2) $120,975 20,000 N/A $17,714(3)
President and Chief 1996 224,048(2) 111,740 12,000 16,059(3)
Executive Officer 1995 220,983(2) 74,720 15,000 14,944(3)
of Company & Bank
Tom Kramer.................. 1997 154,103 76,404 5,000 N/A 13,259(4)
Executive Vice 1996 154,103 86,097 12,000 12,325(4)
President, Chief 1995 149,936 57,573 10,000 11,215(4)
Credit Officer and
Secretary of Company &
Bank
Donna Miltenberger.......... 1997 146,969 79,328 15,000 N/A 3,268(5)
Executive Vice 1996 141,292 79,126 12,000 3,750(5)
President and 1995 134,458 51,790 10,000 3,607(5)
Chief Operating Officer of
Company & Bank
</TABLE>

- ---------------
(1) Bonuses paid to the Named Officers are pursuant to annual incentive
compensation programs established each year for all employees of the Bank,
including the Bank's executive officers. Under this program, performance
goals, relating to such matters as deposit and loan growth, improvements in
loan quality and profitability were established each year. Incentive
compensation, in the form of cash bonuses, was awarded based on the extent
to which the Bank achieved or exceeded the performance goals.

(2) Salary figures for Mr. Langley include directors' fees paid to him by the
Company and the Bank in each year presented.

(3) Includes $14,381 in above-market earnings accrued in 1997, $12,309 in 1996
and $11,417 accrued in 1995, on compensation deferred in the years 1985
through 1988 under a deferred compensation plan in effect during that period
designed to provide retirement benefits for officers and other key
management employees (the "1985 Deferred Compensation Plan") and employer
contributions to the Company's 401(k) Plan (the "401k Plan") of $3,333 in
1997, $3,750 in 1996 and $3,527 in 1995.

(4) Includes $10,048 in above-market earnings accrued in 1997, $8,575 in 1996
and $7,900 accrued in 1995, on compensation deferred in 1985 through 1989 by
Mr. Kramer under the 1985 Deferred Compensation Plan and employer
contributions to the 401k Plan of $3,210 in 1997, $3,750 in 1996 and $3,315
in 1995.

(5) Includes employer contributions to the 401k Plan of $3,268 in 1997, $3,750
in 1996 and $3,607 in 1995.

6
<PAGE> 10

OPTION GRANTS

The following table provides information on option grants in fiscal 1997 to
the Named Officers.

<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE OF
OPTIONS AT ASSUMED
PERCENT OF ANNUAL RATES
TOTAL OPTIONS OF STOCK PRICE
GRANTED TO APPRECIATION FOR
OPTIONS ALL EMPLOYEES EXERCISE OPTION TERM(6)
GRANTED IN IN FISCAL PRICE EXPIRATION ---------------------
NAME 1997 1997(4) ($/SHARE)(5) DATES 5% 10%
---- ---------- ------------- ------------ ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
George E. Langley.............. 20,000(1) 22.73% $ 11.50 1/27/07 $144,900 $365,700
Tom Kramer..................... 5,000(2) 5.68% $15.375 9/29/07 $ 48,431 $122,231
Donna Miltenberger............. 15,000(3) 17.04% $13.875 9/11/07 $131,119 $330,919
</TABLE>

- ---------------
(1) Shares become exercisable in 3 annual installments of 6,459 shares on
January 28, 1997, 8,695 shares on January 28, 1998 and 4,846 shares on
January 28, 1999.

(2) Shares become exercisable on September 30, 1997.

(3) Shares become exercisable in 3 annual installments of 7,060 shares on
September 12, 1997, 7,207 shares on January 1, 1998 and 733 shares on
January 1, 1999.

(4) Options to purchase an aggregate of 88,000 shares were granted to all
employees in fiscal 1997, including the Named Officers.

(5) The exercise price may be paid by delivery of already-owned shares.

(6) There is no assurance that the values that may be realized by an executive
on exercise of his or her options will be at or near the value estimated in
the table, which utilizes arbitrary compounded rates of growth of stock
price of 5% and 10% per year.

OPTION EXERCISES AND FISCAL YEAR-END VALUES

The following table provides information on option exercises in fiscal 1997
by the Named Officers and the value of unexercised in-the-money options held by
the Named Officers as of December 31, 1997.

AGGREGATED OPTION EXERCISES IN LAST FISCAL
YEAR AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT FY-END(#) OPTIONS AT FY-END($)(3)
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
George E. Langley -- -- 75,971 5,330 $700,743 $33,548
Tom Kramer -- -- 51,262 -- $468,013 $ --
Donna Miltenberger 6,352 $49,443(1) 46,554 733 $356,576 $ 2,107
6,987 84,532(2)
</TABLE>

- ---------------
(1) The average of the high and low prices of the Company's common stock on
March 20, 1997 (the exercise date) on the NASDAQ National Market was
$13.6875

(2) The average of the high and low prices of the Company's common stock on
December 11, 1997 (the exercise date) on the NASDAQ National Market was
$16.75.

(3) The average of the high and low prices of the Company's common stock on
December 31, 1997 on the NASDAQ National Market was $16.75.

Employment Agreements. Under an employment agreement which became effective
October 1, 1997 and replaces a prior employment agreement that would have
otherwise expired March 31, 1998, Mr. Langley is employed as the Bank's
President and Chief Executive Officer for a three-year term expiring September
30, 2000. Under that agreement, Mr. Langley receives a base annual salary of
$244,000 and is entitled to participate in any bonus or incentive compensation
programs and other employee benefit plans generally made available to executives
and key employees of the Bank. The Bank also has agreed to furnish Mr. Langley
with

7
<PAGE> 11

the use of an automobile and to provide him with certain supplemental insurance
benefits. Under the employment agreement, the Bank may terminate Mr. Langley's
employment at any time without cause. In the event that Mr. Langley's employment
is terminated without cause prior to September 30, 2000, Mr. Langley's salary,
bonuses and other benefits would be continued for a period of three years
measured from the September 30 immediately following such termination. In
October 1997, Mr. Langley and the Bank entered into a severance compensation
agreement. Under such agreement, if there is a change in ownership of the Bank
or the Company, whether by acquisition of shares, merger or sale of assets, and
following such change in ownership, Mr. Langley's employment is terminated
without cause, or if Mr. Langley terminates his employment due to a reduction in
his compensation or the scope of his authority or duties, Mr. Langley shall
receive a payment equal to the sum of (i) an amount equal to three times the
highest base salary paid to Mr. Langley during the twelve month period prior to
such termination, (ii) an amount equal to the bonuses that would have been paid
to Mr. Langley under any applicable incentive compensation plans, assuming all
performance goals established under such plans had been met and (iii) an amount
equal to the difference between the exercise price and the fair market value of
all shares subject to vested and unvested stock options held by Mr. Langley. In
addition, upon such termination following a change in ownership of the Bank or
the Company, Mr. Langley's benefits would be continued for a period of three
years from the date of termination. In the event of Mr. Langley's death while
employed as the Bank's President and Chief Executive Officer, salary and bonuses
shall cease, but the Bank will be obligated to continue the dependent health and
dental insurance coverage for Mr. Langley's wife and children for a period of
three years thereafter. If Mr. Langley's employment is terminated for cause, by
reason of resignation, or due to a medical disability, and Mr. Langley, during
the period ending on the later of September 30, 2000 or the first anniversary of
the effective date of such termination, refrains from accepting employment from,
and from providing consulting or advisory services to, any competing banking or
depository institution, then, for such period all life, medical, dental and
disability insurance programs in which Mr. Langley was participating at that
time will be continued.

The Bank also has an agreement with Mr. Kramer and Ms. Miltenberger which
entitles them each to receive two full years' compensation if they are
terminated or their compensation or job responsibilities are reduced following a
change in ownership of the Company or the Bank, whether by acquisition of
shares, merger or sale of assets.

Directors' Fees. During fiscal 1997 the Bank paid the Chairman of the Board
of Directors $1,950 per month and each other director, including Mr. Langley,
$1,550 per month in directors' fees for services and attendance at Board and
committee meetings, and each director received $454 per month as reimbursement
for health insurance premiums.

Deferred Compensation Plans. Effective January 1, 1985, the Bank adopted
the 1985 Deferred Compensation Plan, a voluntary unfunded deferred compensation
plan, which permitted selected key, salaried employees of the Bank to defer
receipt of a portion of their annual salaries and bonuses that would otherwise
have been paid during a four-year period ended December 31, 1988. The 1985
Deferred Compensation Plan was established to attract and retain key employees
and directors by providing them with a supplemental retirement benefit in an
amount determined on the basis of the amount of salary deferred annually over
that four-year period and the participant's age at the time of participation.
The supplemental retirement benefits will be payable over ten years commencing
on the participant's retirement date, except that if the participant dies prior
thereto, his or her beneficiaries would receive a death benefit, in lieu of the
retirement benefit, over a ten year period. The benefit payments are not subject
to any reduction for Social Security benefits or other offset amounts. A total
of 19 employees, including Messrs. Langley and Kramer participated in the 1985
Deferred Compensation Plan. The 1985 Deferred Compensation Plan is administered
by a committee of the Board of Directors of the Bank.

The Bank has purchased life insurance on employees participating in the
1985 Deferred Compensation Plan in amounts that, in the aggregate, are expected,
on an actuarial basis, to fund all of its future obligations under this plan.
The Bank is the owner and sole beneficiary of all such life insurance. Thus, no
direct allocation of cost is made to any one employee and no amount attributable
to the expenses of the 1985 Deferred Compensation Plan is included in the
Summary Compensation Table set forth above. Earnings on amounts in each
participant's account accrue at an annual fixed rate. It is estimated that,
under this Plan, Mr. Langley

8
<PAGE> 12

will receive approximately $127,500 per year over the ten-year period following
his retirement and Mr. Kramer will receive approximately $140,000 per year for
ten years following his retirement.

Under a deferred compensation plan presently in effect, officers and other
key employees are entitled, prior to the beginning of each fiscal year, to elect
to defer a portion of their annual salary in the upcoming year under annually
established unfunded deferred compensation programs designed to provide for each
participating employee a supplemental retirement benefit in an amount based on
the salary deferred and earnings thereon.

Certain Transactions. The Bank has had, and in the future may have, banking
transactions in the ordinary course of its business with directors, principal
shareholders and their associates, including the making of loans to directors
and their associates. Such loans and other banking transactions are made on the
same terms, including interest rates and collateral securing the loans, as those
prevailing at the time for comparable transactions with unaffiliated persons. In
addition, such loans are made only if they do not involve more than the normal
risk of collectibility and do not present other unfavorable features.

REPORT OF COMPENSATION COMMITTEE

The Compensation Committee is responsible for approving, and evaluating the
efficacy of, compensation policies and programs for the Bank, which employs all
of the Company's executive officers, and for making determinations regarding the
compensation of the Company's executive officers, subject to review by the full
Board of Directors. In fiscal 1997 the members of the Compensation Committee
were William V. Landecena, O.L. Mestad, Richard H. Barker, Douglas F. Tessitor,
and Max E. Williams, all of whom are non-employee Directors of the Company and
the Bank.

The following report is submitted by the Compensation Committee members
with respect to the executive compensation policies established by the
Compensation Committee and approved by the Board of Directors of the Bank and
the compensation of executive officers in fiscal 1997.

COMPENSATION POLICIES AND OBJECTIVES

In adopting, and also evaluating the effectiveness of, compensation
programs for executive officers, as well as other employees of the Bank, the
Compensation Committee is guided by three basic principles:

- The Company and the Bank must be able to attract and retain
highly-qualified and experienced banking professionals with proven
performance records.

- A substantial portion of annual executive compensation should be tied to
the Bank's performance, measured in terms of profitability, asset growth
and asset quality.

- The financial interests of the Company's senior executives should be
aligned with the financial interests of the shareholders, primarily
through stock option grants which reward executives for improvements in
the market performance of the Company's common stock.

Attracting and Retaining Executives and Other Key Employees. There is
substantial competition among banks and other financial institutions and service
organizations for qualified banking professionals. In order to retain executives
and other key employees, and to attract additional well-qualified banking
professionals when the need arises, the Company strives to offer salaries and
health care, retirement and other employee benefit programs to its executives
and other key employees which are competitive with those offered by other
financial institutions and service organizations in California.

In establishing salaries for executive officers, the Compensation Committee
reviews (i) the historical performance of the executives; and (ii) available
information regarding prevailing salaries and compensation programs at banks and
other financial organizations which are comparable, in terms of asset-size,
capitalization and performance, to the Bank. Another factor which is considered
in establishing salaries of executive officers is the cost of living in Southern
California, which generally is higher than in other parts of the country.
Effective October 1, 1997, the salary of Ms. Miltenberger was increased by
12.18% to bring her salary in line with prevailing salaries of executive
officers at comparable banking institutions and to adjust for increases that had
occurred in the consumer price index in Southern California.

9
<PAGE> 13

In addition, the Bank has followed the practice of entering into multi-year
employment agreements with its Chief Executive Officer. Such agreements serve to
assure continuity in that position and to deter competing banks from attempting
to hire away the Bank's Chief Executive Officer.

In October 1997, the Bank entered into a new three year employment
agreement with George Langley, the Company's Chief Executive Officer, which
extends his employment for three years to September 30, 2000. Under that
employment agreement, Mr. Langley's base annual salary is $244,000. The decision
to enter into a three year employment agreement with Mr. Langley was based on a
number of factors, including the Bank's performance during his tenure as Chief
Executive Officer, Mr. Langley's long tenure with the Bank for which he has
served as an executive officer since 1976, and the continuity and stability of
management that Mr. Langley's retention as Chief Executive Officer provides to
both the Company and the Bank.

Performance-Based Compensation. The Compensation Committee believes that
payment of compensation in excess of a senior executive's base salary should be
made dependent on the level of profitability achieved by the Bank and its
comparative performance as measured against the performance of other banking
institutions of comparable size in Northern and Southern California ("Peer-Group
Banks").

The Compensation Committee has identified several performance factors which
affect a bank's profitability and which the Compensation Committee believes are
important to the enhancement of shareholder values. These include asset growth;
the quality and collectibility of the Bank's assets, which consist primarily of
loans and investment securities; the volume and mix of deposits, which affect
the Company's net interest margin or "spread" and also its fee income; and the
level of non-interest expense. On the basis of evaluations of the prior year's
operations, economic and market conditions in the Bank's service areas and
management and outside consultant reports, at the beginning of each fiscal year
the Board of Directors establishes annual performance goals for the Bank in each
of these areas, and weights these performance factors in terms of their
anticipated impact on the Bank's earnings, and also establishes an earnings goal
for the year. As a general rule, the performance goals that are established
require that the Bank achieve a level of profitability in excess of at least the
average profitability achieved by the Peer-Group Banks as a condition to the
payment of any bonuses to senior executives. If that condition is satisfied, a
percentage (determined by the Compensation Committee at the beginning of the
fiscal year) of the higher-than-average earnings achieved by the Bank are set
aside as a pool from which bonuses are paid. The amount of the bonuses that are
paid from that pool, in turn, is based on the extent to which the Bank has
achieved or exceeded the goals in each of the performance areas described above.

As a result of these performance-based bonus programs, as a general rule
executive compensation will be higher and the proportion of each executive's
total cash compensation that is represented by incentive or bonus compensation
will increase in those years when performance goals are exceeded. In 1997, the
Bank's performance exceeded a number of the performance goals established for
1997. However, the Bank's performance in 1997, in relation to the performance
goals established for 1997, paralleled the Bank's performance in 1996, in
relation to the performance goals established for 1996. As a result, in 1997
bonus compensation represented 33.9% of Mr. Langley's total cash compensation,
as compared to 33.3% in 1996, 33.1% of Mr. Kramer's total compensation as
compared to 35.8% in 1996 and 35.0% of Ms. Miltenberger's total cash
compensation as compared to 35.9% in 1996.

Stock Programs. In order to align the financial interests of senior
executives and other key employees with those of the shareholders, the Company
grants stock options to its senior executives and other key employees on a
periodic basis. Stock option grants reward senior executives and other key
employees for performance that results in improved market performance of the
Company's stock, which directly benefits all shareholders. Generally, the number
of shares included in each stock option grant is determined based on an
evaluation of the executive's importance to the future performance of the Bank.
As a result, as a general rule, the more senior the executive, the greater the
number of option shares that are awarded. In addition, in 1993 the Bank
established a 401(k) Plan in which all employees, including executive officers,
may participate. Under this plan, employees may make contributions which they
may elect to have invested in Company common stock. In addition, the Company
makes matching contributions of up to 4% of amounts contributed

10
<PAGE> 14

by participants, with shares of Company common stock. Each of the named officers
participated in this plan in 1997.
William V. Landecena
O.L. Mestad
Richard H. Barker
Douglas F. Tessitor
Max E. Williams

Notwithstanding anything to the contrary set forth in the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this Proxy Statement, in whole or in part, the foregoing Report, and
the performance graph on page 11 shall not be incorporated by reference into any
such filings.

COMPANY PERFORMANCE

The following graph shows a five-year comparison of cumulative total
returns for the Company, the S&P 500 composite index and an index of peer group
companies published by SNL Securities, L.P.

COMPARISON OF CUMULATIVE TOTAL RETURN

<TABLE>
<CAPTION>
FOOTHILL
MEASUREMENT PERIOD INDEPENDENT SNL BANKS (UNDER
(FISCAL YEAR COVERED) BANCORP S&P 500 $500M)
<S> <C> <C> <C>
12/31/92 100.00 100.00 100.00
12/31/93 146.13 110.08 130.56
12/31/94 144.84 111.53 140.42
12/31/95 147.51 153.44 192.09
12/31/96 233.24 188.52 247.24
12/31/97 373.67 251.44 421.47
</TABLE>

SOURCE: SNL SECURITIES, L.P.

The total cumulative return on investment (change in the period-end stock
price plus reinvested dividends) for each of the periods for the Company, the
S&P composite index and the peer group companies is based on the stock price or
composite index at the end of fiscal 1992.

The graph above compares the performance of the Company with that of (i)
the S&P 500 composite index and (ii) an index, published by SNL Securities,
L.P., which is made up of banks and bank holding companies, including the
Company, that have securities publicly traded on the New York Stock Exchange,
the American Stock Exchange or the NASDAQ Stock Market, and that have assets
with a value less than $500,000,000.

11
<PAGE> 15

INDEPENDENT PUBLIC ACCOUNTANTS

Vavrinek, Trine, Day & Company, who were the Company's independent
accountants for the fiscal year ended December 31, 1997, have been selected by
the Board of Directors as the Company's independent accountants for the fiscal
year ending December 31, 1998. A representative of Vavrinek, Trine, Day &
Company will attend the meeting, will have an opportunity to make a statement
and will be available to respond to appropriate questions.

SHAREHOLDER PROPOSALS

Any shareholder desiring to submit a proposal for action at the 1998 Annual
Meeting of Shareholders and presentation in the Company's Proxy Statement with
respect to such meeting should arrange for such proposal to be delivered to the
Company at its principal place of business no later than December 15, 1998.
Matters pertaining to such proposals, including the number and length thereof,
eligibility of persons entitled to have such proposals included and other
aspects are regulated by the Securities Exchange Act of 1934, Rules and
Regulations of the Securities and Exchange Commission and other laws and
regulations to which interested persons should refer.

OTHER MATTERS

Management is not aware of any other matters to come before the meeting. If
any other matter not mentioned in this Proxy Statement is brought before the
meeting, the proxy holders named in the enclosed Proxy will have discretionary
authority to vote all proxies with respect thereto in accordance with their
judgment.

By Order of the Board of Directors

George E. Langley
President

April 14, 1998

The Annual Report to Shareholders of the Company for the fiscal year ended
December 31, 1997 is being mailed to all shareholders of record as of April 3,
1998 concurrently with this Proxy Statement. The Annual Report is not to be
regarded as proxy soliciting material or as a communication by means of which
any solicitation is to be made.

COPIES OF THE COMPANY'S ANNUAL REPORT TO THE SECURITIES AND EXCHANGE
COMMISSION ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997 WILL BE
PROVIDED TO SHAREHOLDERS WITHOUT CHARGE UPON WRITTEN REQUEST TO THE SECRETARY,
FOOTHILL INDEPENDENT BANCORP, 510 SOUTH GRAND AVENUE, GLENDORA, CALIFORNIA
91741.

12
<PAGE> 16
PROXY

FOOTHILL INDEPENDENT BANCORP
PROXY SOLICITED BY THE BOARD OF DIRECTORS
ANNUAL MEETING OF THE SHAREHOLDERS
MAY 12, 1998

The undersigned hereby nominates, constitutes and appoints Richard H. Barker,
William V. Landecena and O.L. Mestad, and each of them individually, the
attorney, agent and proxy of the undersigned, with full power of substitution,
to vote all stock of FOOTHILL INDEPENDENT BANCORP which the undersigned is
entitled to represent and vote at the 1998 Annual Meeting of Shareholders of the
Company to be held at The Glendora Country Club, 310 So. Amelia Avenue,
Glendora, California, on May 12, 1998, at 4:30 p.m., and at any and all
adjournments thereof, as fully as if the undersigned were present and voting at
the meeting, as follows:

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE URGED TO SIGN AND
RETURN THIS PROXY, WHICH MAY BE REVOKED AT ANY TIME PRIOR TO ITS USE.

IMPORTANT - PLEASE SIGN AND DATE ON OTHER SIDE AND RETURN PROMPTLY

- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -

<PAGE> 17
Please mark
your votes /X/
as this.

THE DIRECTORS RECOMMEND A VOTE "FOR" ITEM 1

1. ELECTION OF DIRECTORS

Election of the following nominees as Class I directors for a two year
term:

FOR all
nominees WITHHOLD
listed below AUTHORITY
(except as to vote for
marked to the all nominees
contrary below) listed below
/ / / /

George E. Langley, Douglas F. Tessitor and Max E. Williams

(INSTRUCTIONS: To withhold authority to vote for any nominee, print that
nominee's name in the space provided below.)

- --------------------------------------------------------------------------------

2. IN THEIR DISCRETION, ON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING OR ANY ADJOURNMENT THEREOF.

I will attend meeting / /

THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE
SHAREHOLDER ON THIS PROXY. WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE
VOTED "FOR" THE ELECTION OF THE DIRECTORS NAMED ABOVE ON THIS PROXY. THIS PROXY
CONFERS DISCRETIONARY AUTHORITY TO CUMULATE VOTES FOR ANY AND ALL OF THE
NOMINEES FOR ELECTION OF DIRECTORS FOR WHICH AUTHORITY TO VOTE HAS NOT BEEN
WITHHELD.

Signature(s)
--------------------------------------------------------------------

Date , 1998
------------------------------------------

Please sign your name exactly as it appears hereon. Executors, administrators,
guardians, officers of corporations, and others signing in a fiduciary capacity
should state their full titles as such.

- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -