<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
INDIANA UNITED BANCORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
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:
------------------------------------------------------------------------
<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
INDIANA UNITED BANCORP
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
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:
-----------------------------------------------------------------------
<PAGE>
INDIANA UNITED BANCORP
201 N. BROADWAY
[LOGO]
GREENSBURG, INDIANA 47240
-------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON TUESDAY, MAY 18, 1999
-------------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Indiana
United Bancorp (the "Company") will be held in the Conference Center on the
second floor of the Company's principal office at 201 N. Broadway, Greensburg,
Indiana, on Tuesday the 18th day of May, 1999, at 10:00 A.M. (Eastern Standard
Time), for the following purposes:
1. To elect to the Board of Directors ten (10) directors to serve until the
next Annual Meeting and until their successors are elected and qualified;
2. To ratify the appointment of Crowe Chizek and Company LLP as the
Company's independent accountants for the fiscal year ending December 31,
1999; and
3. To transact such other business as may properly come before the meeting
or any adjournment thereof.
Only shareholders of record at the close of business on March 12, 1999 are
entitled to notice of and to vote at the Annual Meeting. The transfer books will
not be closed.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE, DATE
AND SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED STAMPED
ENVELOPE. IF YOU ARE ABLE TO ATTEND THE MEETING AND WISH TO VOTE YOUR SHARES
PERSONALLY, YOU MAY DO SO AT ANY TIME BEFORE THE PROXY IS EXERCISED.
By Order of the Board of Directors,
[LOGO]
SUE FAWBUSH
SECRETARY
Greensburg, Indiana
March 31, 1999
<PAGE>
INDIANA UNITED BANCORP
201 N. BROADWAY
GREENSBURG, INDIANA 47240
------------------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
MAY 18, 1999
------------------------------------
INTRODUCTION
This Proxy Statement is being furnished to shareholders of Indiana United
Bancorp, an Indiana corporation (the "Company"), in connection with the
solicitation of proxies by the Board of Directors of the Company from holders of
record of the Company's outstanding shares of common stock, no par value per
share (the "Common Stock"), as of the close of business on March 12, 1999, for
use at the Annual Meeting of Shareholders of the Company (the "Annual Meeting")
to be held on Tuesday, May 18, 1999, at 10:00 a.m. (Eastern Standard Time) in
the Conference Center on the second floor of the Company's principal office at
201 N. Broadway, Greensburg, Indiana, and at any adjournment or postponement
thereof. This Proxy Statement is first being mailed to the Company's
shareholders on or about March 31, 1999.
PURPOSES OF THE ANNUAL MEETING
At the Annual Meeting, holders of shares of Common Stock will be asked to
consider and to vote upon the following matters:
(i.) The election of ten directors of the Company who will serve until the
2000 Annual Meeting and until their successors are elected and
qualified;
(ii.) The appointment of Crowe Chizek and Company LLP ("Crowe Chizek") as the
Company's independent accountants for the fiscal year ending December
31, 1999; and
(iii.) Such other business as may properly come before the Annual Meeting.
The Board of Directors has unanimously recommended that shareholders vote
"FOR" the election of the Board of Directors' ten nominees for election as
directors of the Company, and "FOR" the ratification of the Board of Directors'
appointment of Crowe Chizek as the Company's independent accountants. As of the
date of this Proxy Statement, the Board of Directors knows of no other business
to come before the Annual Meeting.
VOTING RIGHTS AND PROXY INFORMATION
Only holders of record of shares of Common Stock as of the close of business
on March 12, 1999 will be entitled to notice of and to vote at the Annual
Meeting or any adjournment or postponement thereof. Such holders of shares of
Common Stock are entitled to one vote per share on any matter that may properly
come before the Annual Meeting. The presence, either in person or by properly
executed proxy, of the holders of a majority of the outstanding shares of Common
Stock as of the record date is necessary to constitute a quorum at the Annual
Meeting. As of March 12, 1999, there were 4,774,628 shares of Common Stock
outstanding.
The affirmative vote of a plurality of the shares of Common Stock
represented in person or by properly executed proxy at the Annual Meeting is
required to approve the election of each of the Company's nominees for election
as a director. The affirmative vote of a majority of the shares of Common Stock
voted is required to ratify the appointment of Crowe Chizek as the Company's
independent accountants for the fiscal year ending December 31, 1999.
3
<PAGE>
All shares of Common Stock that are represented at the Annual Meeting by
properly executed proxies received prior to or at the Annual Meeting and not
revoked will be voted at the Annual Meeting in accordance with the instructions
indicated in such proxies. If no instructions are indicated, such proxies will
be voted for the election of the Board of Directors' ten nominees as directors
of the Company and for the ratification of the appointment of Crowe Chizek as
the Company's independent accountants.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before it is voted. Proxies may be revoked by (i) filing
with the Secretary of the Company, at or before the Annual Meeting, a written
notice of revocation bearing a later date than the proxy, (ii) duly executing a
subsequent proxy relating to the same shares of Common Stock and delivering it
to the Secretary of the Company at or before the Annual Meeting or (iii)
attending the Annual Meeting and voting in person (although attendance at the
Annual Meeting will not in and of itself constitute a revocation of a proxy).
Any written notice revoking a proxy should be sent to the Company, to the
attention of Sue Fawbush, Secretary.
The Company will bear the cost of this solicitation. In addition to
solicitation by mail, the Company will request banks, brokers, and other
custodian nominees and fiduciaries to supply proxy material to the beneficial
owners of Common Stock, and will reimburse them for their expenses in so doing.
Certain directors, officers and other employees of the Company, not specially
employed for this purpose, may solicit proxies, without additional remuneration
therefor, by personal interview, mail, telephone, facsimile or other electronic
means.
ANNUAL REPORT
The Company's 1998 Annual Report, which includes consolidated financial
statements, accompanies this Proxy Statement.
PRINCIPAL SHAREHOLDERS
As of February 12, 1999, the following individuals or entities reported
beneficial ownership of Common Stock in excess of 5% of the Company's
outstanding Common Stock:
<TABLE>
<CAPTION>
NUMBER OF SHARES
NAME AND ADDRESS BENEFICIALLY OWNED PERCENTAGE OF
OF BENEFICIAL OWNER (L) OUTSTANDING SHARES
- ------------------------------------ -------------------- ---------------------
<S> <C> <C>
Robert S. Dunevant
3402 N. Dearborn Rd.
West Harrison, IN 47060
459,948(2) 9.6%
</TABLE>
- ------------------------------------
(1) The information contained in this column is based upon information furnished
to the Company by the named individuals and the shareholder records of the
Company. Except where otherwise indicated, this column represents the number
of shares beneficially owned, which includes shares as to which a person has
sole or shared voting and/or investment power.
(2) Includes 205,286 shares held by Mr. Dunevant's wife over which she has sole
voting and investment power, and 5,004 shares held by Unity Company, over
which Mr. Dunevant has shared voting and investment power. Mr. Dunevant
disclaims beneficial ownership of all shares over which his wife has sole
voting and investment power.
4
<PAGE>
ELECTION OF DIRECTORS
(ITEM 1 ON PROXY)
A board of ten directors of the Company is to be elected at the Annual
Meeting, each of whom is to serve, subject to the provisions of the Bylaws,
until his successor is duly elected and qualified. The names of the nominees
proposed for election as directors, all of whom are presently directors of the
Company except Eric E. Anderson, are set forth below and the following
information is furnished with respect to each:
<TABLE>
<CAPTION>
COMMON
STOCK
DIRECTOR OF BENEFICIALLY PERCENTAGE
COMPANY OWNED AS OF
PRINCIPAL OCCUPATION OR CONTINUOUSLY OF OUTSTANDING
NOMINEE EMPLOYMENT (1) AGE SINCE 2/12/99(2) SHARES
- ------------------------- ------------------------------ --- ----------------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Eric E. Anderson Part Owner and Secretary- 39 1,000(3) less than 1%
Treasurer, The Anderson
Group
Insurance and Financial
Services,
Inc. (general insurance
agency)
John E. Back President, Twin Forks 69 May 1, 1998 66,290(5) 1.4%
Development Corporation
(recreation leasing
development
company) (4)
William G. Barron Chairman and President, 49 April 25, 1989 230,124(6) 4.8%
Wm. G. Barron Enterprises,
(commercial real estate
broker,
manager and developer)
Dale J. Deffner Partner, Deffner and Tebbe 66 May 1, 1998 135,580(7) 2.8%
Accounting Service
(public accounting firm)
Robert S. Dunevant President, Unity Company 79 May 1, 1998 459,948(9) 9.6%
(asset-based receivables
company) (8)
Philip A. Frantz Partner, Coldren & Frantz 54 Sept. 16, 1987 17,520 (10) less than 1%
(attorneys at law)
Robert E. Hoptry Chairman of the Board and 60 its incorporation 140,824 (12) 2.9%
Chief Executive Officer of on March 30, 1983
the Company (11)
James L. Saner, Sr. President and Chief Operating 47 May 1, 1998 44,883 (14) less than 1%
Officer of the Company (13)
Dale E. Smith President, Smith Realty and 65 May 1, 1998 61,098 (15) 1.3%
Insurance, Inc.
Edward J. Zoeller President, E. M. Cummings 54 March 17,1994 6,112 (16) less than 1%
Veneer, Inc., (manufacturer
of
veneered furniture parts)
All directors, nominees
and executive officers as
a group (14 in number
including the above-
named persons) 1,276,905 26.7%
</TABLE>
- ------------------------
(1) Except where otherwise indicated, this principal occupation or employment
has continued during the past five years.
(2) The information contained in this column is based upon information furnished
to the Company by the named individuals and the shareholder records of the
Company. Except where otherwise indicated,
5
<PAGE>
this column represents the number of shares beneficially owned, which
includes shares as to which a person has sole or shared voting and/or
investment power.
(3) Mr. Anderson has the right to acquire 24,274 shares of Common Stock within
the next 60 days pursuant to the terms of, and subject to the satisfaction
of the conditions in, that certain Agreement and Plan of Merger dated as of
March 31, 1999 among the Company, The Insurance Group, Inc. (a newly formed
subsidiary of the Company), The Andy Anderson Insurance Agency, Inc. and the
shareholders of Andy Anderson Insurance Agency, Inc. (consisting of Mr.
Anderson, Mr. Anderson's father and Mr. Anderson's two brothers). Mr.
Anderson disclaims beneficial ownership of 56,639 shares of Common Stock
that his father and two brothers have the right to acquire under such
Agreement.
(4) Mr. Back is a retired Senior Vice President of Sperry Rubber and Plastics
Company.
(5) These shares are held jointly by Mr. Back with his wife as co-trustees of a
revocable living trust, over which they share voting and investment power.
(6) Includes 18,213 shares held by Mr. Barron as custodian under the Kentucky
Uniform Gifts to Minors Act for the benefit of his children and 10,265
shares held by Mr. Barron in his Individual Retirement Account, over which
Mr. Barron has sole voting and investment power. Includes 4,659 shares held
in William G. Barron Enterprises Inc., over which Mr. Barron has sole voting
and investment power. Also includes 18,307 shares over which Mr. Barron has
shared voting and investment power with his mother, Frankie G. Barron, as
co-trustee of trusts for the benefit of certain family members of Mr.
Barron. Also includes 58,754 shares held by Mr. Barron's wife as trustee of
a trust for the benefit of Mr. Barron's wife and his children and 11,738
shares held by Mr. Barron's wife in her Individual Retirement Account, over
which Mr. Barron's wife has sole voting and investment power. Also includes
60,732 shares held in the Barron Family Partnership, LTD, over which Mr.
Barron and his wife have shared voting and investment power. Mr. Barron
disclaims beneficial ownership of all shares over which his wife has sole
voting and investment power. Mr. Barron disclaims beneficial ownership over
3,097 shares held by his adult son. Mr. Barron also disclaims beneficial
ownership over 164,668 shares held by his mother, under a trust established
by Mr. Barron's father, over which Mr. Barron's mother has sole voting and
investment power.
(7) Includes 62,470 shares held directly by Mr. Deffner's wife and 6,932 shares
held by Mr. Deffner's wife in her Individual Retirement Account over which
Mr. Deffner's wife has sole voting and investment power. Also includes 6,932
shares held by Mr. Deffner in his Individual Retirement Account, over which
he has sole voting and investment power. Mr. Deffner disclaims beneficial
ownership of all shares over which his wife has sole voting and investment
power.
(8) Mr. Dunevant holds the honorary position of Vice Chairman of the Board of
the Company. Prior to May 1, 1998, Mr. Dunevant was Chairman of the Board of
P.T.C. Bancorp and, prior to January 1, 1989, the Chief Executive Officer of
People's Trust Company, Brookville, Indiana. Mr. Dunevant also serves as
President of Bright Center, a non-profit affordable senior housing facility.
(9) For information regarding Mr. Dunevant's beneficial ownership of Common
Stock, see footnote (2) under "INTRODUCTION--Principal Shareholders".
(10) Includes 138 shares owned directly by Mr. Frantz's wife and 690 shares held
by Mr. Frantz's wife through an Individual Retirement Account, over which
Mr. Frantz's wife has sole voting and investment power. Also includes 6,523
shares held jointly by Mr. Frantz with his wife, over which he shares voting
and investment power and 3,953 shares held in Mr. Frantz's Individual
Retirement Account, over which he has sole voting and investment power. Mr.
Frantz disclaims beneficial ownership over 920 shares held by his adult
children. Mr. Frantz also disclaims beneficial ownership of all shares over
which his wife has sole voting and investment power.
6
<PAGE>
(11) Mr. Hoptry serves as Chairman of the Board and Chief Executive Officer of
the Company. Prior to May 1, 1998, Mr. Hoptry also served as President of
the Company.
(12) Includes 18,288 shares held by Mr. Hoptry through the Company's Retirement
and Savings Incentive Plan and 2,136 shares in his Individual Retirement
Account, over which he has sole voting and investment power. Includes 1,067
shares held by Mr. Hoptry's wife through an Individual Retirement Account,
over which Mr. Hoptry's wife has sole voting and investment power. Also
includes 508 shares held by Mr. Hoptry for the benefit of his grandchildren
over which Mr. Hoptry has sole voting and investment power. Mr. Hoptry
disclaims beneficial ownership of all shares over which his wife has sole
voting and investment power.
(13) Mr. Saner serves as President and Chief Operating Officer of the Company.
Prior to May 1, 1998, Mr. Saner served as President and Chief Executive
Officer of P.T.C. Bancorp, which merged with the Company on April 30, 1998.
(14) Includes 4,498 shares held jointly by Mr. Saner with his wife and 480
shares held for the benefit of Mr. Saner's sons, over which Mr. Saner shares
voting and investment power. Includes 1,156 shares held by Mr. Saner's wife
through an Individual Retirement Account, over which Mr. Saner's wife has
sole voting and investment power. Includes 7,138 shares held by Mr. Saner
through an Individual Retirement Account and 173 shares held by Mr. Saner
through the Company's Retirement and Savings Incentive Plan, over which Mr.
Saner has sole voting and investment power. Mr. Saner disclaims beneficial
ownership of all shares over which his wife has sole voting and investment
power.
(15) Includes 32,524 shares held by Mr. Smith's wife, over which she has sole
voting and investment power. Also includes 12,840 shares held for the
benefit of Mr. Smith's minor grandchildren, over which Mr. Smith has sole
voting and investment power. Mr. Smith disclaims beneficial ownership over
shares held by his adult children. Mr. Smith also disclaims beneficial
ownership of all shares over which his wife has sole voting and investment
power.
(16) Includes 920 shares owned by Mr. Zoeller's wife through an Individual
Retirement Account, over which Mr. Zoeller's wife has sole voting and
investment power. Includes 2,295 shares held jointly by Mr. Zoeller with his
wife and 231 shares held jointly with his two daughters over which Mr.
Zoeller shares voting and investment power. Also includes 1,446 shares held
by Mr. Zoeller in his Individual Retirement Account over which he has sole
voting and investment power. Mr. Zoeller disclaims beneficial ownership of
all shares over which his wife has sole voting and investment power.
Director Martin G. Wilson is not standing for election to the Board and is
retiring under the Company's retirement policy applicable to directors. The
Company wishes to extend its gratitude to Mr. Wilson, who has served on the
Board of Directors since 1983. Mr. Wilson is 72 years of age and a retired
farmer who beneficially owns 79,254 shares or 1.7% of the Company's common stock
which includes 44,000 shares owned by Mr. Wilson's wife, over which she has sole
voting and investment power. Mr. Wilson disclaims beneficial ownership of all
shares over which his wife has sole voting and investment power.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF THE
COMPANY'S NOMINEES FOR ELECTION AS A DIRECTOR.
Shares of Common Stock of the Company represented by proxies executed and
received in the accompanying form will be voted for the election of all of the
above nominees as directors of the Company, unless otherwise indicated. The
Board of Directors does not contemplate that any of the nominees will be unable
to accept election as a director for any reason. However, in the event that one
or more of such nominees is unable or unwilling to serve, the persons named in
the proxies or their substitutes shall have authority, according to their
judgment, to vote or to refrain from voting for other individuals as directors.
7
<PAGE>
The Board of Directors considers nominations of candidates for election as
directors. The Company's Bylaws establish an advance notice procedure for
shareholders to make nominations of candidates for election as directors (the
"Shareholder Notice Procedure"). The Shareholder Notice Procedure provides that
only persons who are nominated by, or at the direction of, the Board of
Directors, or by a shareholder who has given timely written notice to the
Secretary of the Company prior to the meeting at which directors are to be
elected, will be eligible for election as directors of the Company. Under the
Shareholder Notice Procedure, to be timely, notice of shareholder nominations to
be made at an annual or special meeting must be received by the Company not less
than 60 days nor more than 90 days prior to the scheduled date of the meeting
(or, if less than 70 days notice or prior public disclosure of the date of the
meeting is given, the 10th day following the earlier of (i) the day such notice
was mailed or (ii) the day such public disclosure was made).
Under the Shareholder Notice Procedure, a shareholder's notice to the
Company proposing to nominate a person for election as a director must contain
certain information, including, without limitation, the identity and address of
the nominating shareholder, the number of shares of Common Stock that are owned
by such shareholder and all information regarding the proposed nominee that
would be required to be included in a proxy statement soliciting proxies for the
proposed nominee. If the Chairman of the Board or other officer presiding at a
meeting determines that a person was not nominated in accordance with the
Shareholder Notice Procedure, such person will not be eligible for election as a
director.
By requiring advance notice of nominations by shareholders, the Shareholder
Notice Procedure affords the Board an opportunity to consider the qualifications
of the proposed nominees and, to the extent deemed necessary or desirable by the
Board, to inform shareholders about such qualifications.
CERTAIN INFORMATION CONCERNING THE BOARD OF DIRECTORS
Directors who are not officers of the Company are paid an annual retainer of
$5,000 for serving on the Board plus an attendance fee of $750 per meeting. The
retainer is based on twelve regular meetings annually. During 1998, the Board
met twelve times. The Board of Directors has an Audit Committee and a
Compensation Committee. Committee members are paid an attendance fee of $750 per
meeting held on a day on which there is not a Board meeting.
The Audit Committee held six meetings during 1998. The members of the
committee during 1998, none of whom are employees of the Company, were John E.
Back, Dale J. Deffner, Philip A. Frantz (who served as chairman of the Audit
Committee), Dale E. Smith and Edward J. Zoeller. The functions of the Audit
Committee include review of the programs of the Company's internal auditors, the
results of their audits and the adequacy of the Company's system of internal
controls and accounting practices. In addition, the committee has direct access
to the Company's independent accountants, and reviews the scope of their annual
audit prior to its commencement and reviews the types of services for which the
Company retains the independent accountants. The committee also reviews all
regulatory examination reports.
The Compensation Committee held three meetings during 1998 for the purpose
of discussing the factors and criteria upon which the compensation of the
Company's executive officers will be based in 1999. The members of the committee
were William G. Barron, (who served as chairman of the Compensation Committee)
Dale J. Deffner, Robert S. Dunevant, Philip A. Frantz and Edward J. Zoeller,
none of whom are employees of the Company. The function of the Compensation
Committee is to establish the compensation of members of executive management.
The Company does not have a Nominating Committee.
8
<PAGE>
SECTION 16(A)--BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors, executive officers and holders of 10% or more of the outstanding
Common Stock to file reports concerning their direct or indirect ownership of
Company securities. The Company believes that all such reports were filed timely
in compliance with Section 16(a) during 1998.
EXECUTIVE OFFICERS OF THE COMPANY
The following table sets forth the names and ages of all executive officers
of the Company and their positions. Except as set forth below, each executive
officer has held the specified position for the last five years.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---------------------- --- ----------------------------------------------------
<S> <C> <C>
Robert E. Hoptry 60 Chairman of the Board and Chief Executive Officer
(1)
James L. Saner Sr. 47 President and Chief Operating Officer (2)
Daryl R. Tressler 47 Vice President
Michael K. Bauer 44 Vice President (3)
Lynn T. Gordon 49 Vice President (4)
</TABLE>
- ------------------------
1. Prior to May 1, 1998, Mr. Hoptry was also President of the Company.
2. Prior to May 1, 1998, Mr. Saner was the President and Chief Executive
Officer of P.T.C. Bancorp.
3. Mr. Bauer has served as President and Chief Executive Officer of the
Company's subsidiary, Regional Federal Savings Bank, since September 6, 1995
and, additionally, as Chairman of the Board of that subsidiary since May 22,
1996. From 1988 to September 1995, Mr. Bauer was President and Chief
Executive Officer of Harris Bank, Bartlett, Illinois.
4. Mr. Gordon has served as President and Chief Executive Officer of the
Company's subsidiary, People's Trust Company, (acquired on April 30, 1998 in
the merger with P.T.C. Bancorp), since May 1, 1998. Since October, 1997, Mr.
Gordon has served as President of People's Trust Company and, prior to that
time, as Executive Vice President of that bank.
EXECUTIVE COMPENSATION
REPORT OF COMPENSATION COMMITTEE
The compensation of the Company's executive officers is determined by the
Compensation Committee comprised solely of non-employee directors of the
Company. Salary ranges are established for all positions within the Company
based upon comparative peer data as reported by the Bank Administration
Institute ("BAI"). In the case of Mr. Saner, the determination of his
compensation is also influenced by the provisions of an employment agreement
with him. See "--Employment Agreement With James L. Saner, Sr."
According to BAI data, the average compensation paid to the chief executive
officer operating a $500 million banking organization in the Midwest region,
which encompasses Illinois, Indiana, Michigan, Ohio and Wisconsin, is $222,600.
The Company's established salary range for 1998 was $173,400 to $289,000 for its
chief executive officer. The Compensation Committee considers the market
performance of the Company's Common Stock relative to the market performance of
the NASDAQ Market Index (U.S.) and the NASDAQ Financial Stocks Index, and the
Company's overall performance for the year, in establishing the compensation for
the Chief Executive Officer within the approved salary range. The key
9
<PAGE>
performance measure the Committee used in determining Mr. Hoptry's 1998
compensation was its assessment of his ability and dedication to enhance the
long-term value of the Company by continuing to provide the leadership and
vision he has provided throughout his tenure as Chief Executive Officer.
In 1995, the Company initiated an incentive compensation plan under which
substantially all employees of the Company and its subsidiaries are eligible.
The plan considers the performance of each subsidiary as well as consolidated
results. The 1998 payout, based on 1997 results, was 5.00% of wages paid to
parent Company employees; 4.72% to Union Bank employees; and 6.13% to Regional
Bank employees. There will not be a 1999 payout based on the 1998 results.
COMPENSATION COMMITTEE
/s/ William G. Barron, Chairman
/s/ Dale J. Deffner
/s/ Robert S. Dunevant
/s/ Philip A. Frantz
/s/ Edward J. Zoeller
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning total compensation
earned or paid to the Chief Executive Officer and the other highly compensated
officers of the Company exceeding $100,000. who served in such capacities as of
December 31, 1998 (the "named executive officers") for services rendered to the
Company during each of the last three years.
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
--------------------------
ANNUAL COMPENSATION AWARDS
----------------------------------------- --------------------------
OTHER RESTRICTED
ANNUAL STOCK
COMPEN- AWARDS OPTIONS
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) SATION ($) (1) ($) SARS (#)
- --------------------------------------- --------- ----------- ----------- --------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Robert E. Hoptry 1998 185,000 20,000
Chairman of the Board and 1997 178,260 9,382
Chief Executive Officer 1996 158,839 6,142
James L. Saner, Sr. 1998(3) 115,100
President and
Chief Operating Officer
Michael K. Bauer 1998 133,500
Chairman of the Board, 1997 121,352 7,925
President 1996 120,050 3,277
and Chief Executive Officer of
Regional Bank
Daryl R. Tressler 1998 121,200 3,000
Chairman of the Board, 1997 111,910 5,544
President 1996 107,609 4,453
and Chief Executive Officer of
Union Bank
<CAPTION>
PAYOUTS
------------------------
ALL OTHER
LTIP COMPEN-
PAY-OUT SATION
NAME AND PRINCIPAL POSITION ($) ($) (2)
- --------------------------------------- ----------- -----------
<S> <C> <C>
Robert E. Hoptry 26,644
Chairman of the Board and 26,290
Chief Executive Officer 21,015
James L. Saner, Sr. 26,242
President and
Chief Operating Officer
Michael K. Bauer 17,847
Chairman of the Board, 15,922
President
and Chief Executive Officer of
Regional Bank
Daryl R. Tressler 21,909
Chairman of the Board, 16,854
President 16,048
and Chief Executive Officer of
Union Bank
</TABLE>
- ------------------------
(1) The only type of other annual compensation for each of the named executive
officers was in the form of perquisites, and was less than the level
required for reporting.
(2) Employer contributions to the Company's Retirement and Savings Incentive
Plan and matching contributions under the Company's 401 (k) feature within
that Plan.
(3) For the period commencing May 1, 1998.
10
<PAGE>
PERFORMANCE GRAPH
The following graph compares the change in the Company's cumulative total
shareholder return on its Common Stock with the NASDAQ Market Index (U.S.) and
the NASDAQ Financial Stocks Index.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NASDAQ NASDAQ
<S> <C> <C> <C>
Indiana United Financial Stocks Market Index
Bancorp Index (U.S.)
1993 $100.000 $100.000 $100.000
1994 $96.948 $100.237 $97.752
1995 $118.600 $145.981 $138.256
1996 $141.798 $187.127 $170.015
1997 $226.945 $285.867 $208.580
1998 $226.596 $276.585 $293.209
</TABLE>
Assuming $100 invested on 12/31/93 with dividends reinvested
<TABLE>
<CAPTION>
1993 1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
NASDAQ Market Index (U.S.) 100.000 97.752 138.256 170.015 208.580 293.209
NASDAQ Financial Stocks Index 100.000 100.237 145.981 187.127 285.867 276.585
Indiana United Bancorp 100.000 96.948 118.600 141.798 226.945 226.596
</TABLE>
<TABLE>
<S> <C> <C>
Key: -- - - - - - - NASDAQ Market Index
--
-- -- -- -- -- NASDAQ Financial Stocks Index
Indiana United Bancorp
</TABLE>
EMPLOYMENT AGREEMENT WITH JAMES L. SANER, SR.
The Company has an employment agreement with its President and Chief
Operating Officer, James L. Saner, Sr., which became effective as part of the
merger of P.T.C. Bancorp into the Company. The agreement has a term commencing
May 1, 1998 and ending May 31, 2002. During the term of the agreement, the
Company agrees to employ Mr. Saner as its President and Chief Operating Officer
or, at the request of the Company's Board of Directors, as its President and
Chief Executive Officer, as its Chief Executive Officer or as its Chairman of
the Board and Chief Executive Officer. Mr. Saner has agreed, at the request of
the Company's Board of Directors, to resign from the position of President and
Chief Operating Officer if at the time of such request Mr. Saner holds the
position of Chief Executive Officer or the positions of Chairman of the Board
and Chief Executive Officer of the Company. The employment
11
<PAGE>
agreement also provides that Mr. Saner will be nominated for election to the
Company's Board of Directors so long as he is employed under the employment
agreement, and that Mr. Saner shall also have the right to serve as a director
of each subsidiary of the Company.
Under the employment agreement, Mr. Saner receives an annual base salary as
President and Chief Operating Officer of at least the greater of (i) $165,000
and (ii) an amount that is $10,000 less than the highest annual base salary paid
to any other senior executive officer of the Company or any subsidiary of the
Company. Under the employment agreement, Mr. Saner is entitled to receive,
should the Company's Board of Directors elect him to the position of Chief
Executive Officer, an annual base salary that is at least the greater of (i)
$165,000 and (ii) an amount that is $10,000 more than the highest annual base
salary paid to any other senior executive officer of the Company or any
subsidiary of the Company.
In addition to his annual base salary, Mr. Saner is also entitled to
participate in all incentive compensation bonus and fringe benefit plans or
programs from time to time provided to any other senior executive officer of the
Company.
Mr. Saner has the ability to terminate the employment agreement and leave
the employ of the Company at any time and for any reason. In addition, Mr. Saner
has the right to terminate his employment with the Company and receive certain
payments and benefits from the Company for "Good Reason". "Good Reason" is
defined as (i) the failure of the Company's Board of Directors to elect Mr.
Saner to the position of Chief Executive Officer of the Company by May 31, 1999
or such earlier date as the Company's current Chief Executive Officer, Robert E.
Hoptry, shall cease to hold that position, or (ii) a material breach of the
employment agreement by the Company and a failure to cure such breach that
results in Mr. Saner terminating his employment with the Company within 30 days
following the end of the cure period. The Company's Board currently intends to
appoint Mr. Saner Chief Executive Officer of the Company in May, 1999 following
Mr. Hoptry's anticipated retirement and resignation as Chief Executive Officer.
The Company also has the right to terminate Mr. Saner's employment at any
time and for any reason, but unless such termination is for "Cause," the Company
is obligated to make certain payments and provide certain benefits to Mr. Saner.
"Cause" is defined as (i) the conviction of a felony, (ii) the conviction of a
crime involving moral turpitude, (iii) misuse or embezzlement of funds, (iv) use
of alcohol or drugs in such manner as is reasonably likely to injure or
materially adversely affect the reputation of the Company or (v) willful gross
neglect or willful gross misconduct in carrying out duties that is not cured
upon notice from the Company and that results in material economic harm to the
Company.
If Mr. Saner terminates his employment for Good Reason or if the Company
terminates Mr. Saner's employment other than for Cause, Mr. Saner is entitled to
receive, subject to his compliance with certain non-competition provisions
described below, his annual base salary, payable in accordance with the
Company's general payroll practices, for the lesser of (i) 36 months and (ii)
the remainder of the term of the employment agreement, except that Mr. Saner is
always entitled to receive such payments for a minimum of 12 months. In either
of such instances, the Company is also required to use its reasonable best
efforts to provide Mr. Saner with continued participation in insurance benefit
plans on the same terms as other senior executive officers then participate for
a period of twelve months following the termination of such employment.
As a condition to receiving the payments and benefits to be provided to Mr.
Saner if he terminates his employment for Good Reason or if the Company
terminates Mr. Saner's employment other than for Cause, Mr. Saner cannot be
employed directly or indirectly at, or act as a consultant to, any main office
or branch office conducting a banking business that is located in any Indiana
county in which the Company or any subsidiary has an office on the date of Mr.
Saner's employment ceases.
12
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company's subsidiaries have made, and expect to make in the future to
the extent permitted by applicable federal and state banking laws, bank loans in
the ordinary course of business to directors and officers of the Company and its
subsidiaries, and their affiliates and associates, on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with other persons. In the opinion of the Company,
such loans do not involve more than a normal risk of collectibility or present
other unfavorable features. In addition, the Company's banking subsidiaries have
engaged, and in the future may engage, in transactions with such persons and
their affiliates and associates as a depositary of funds, transfer agent,
registrar, fiduciary and provider of other similar services.
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
(ITEM 2 ON PROXY)
The Company has appointed Crowe Chizek and Company LLP ("Crowe Chizek"),
Indianapolis, Indiana, as the Company's independent accountants for the fiscal
year ending December 31, 1999. This is a change in accountants recommended by
the Company's Audit Committee and approved by the Company's Board. Crowe Chizek
was engaged by the Company on March 31, 1999. Olive LLP ("Olive"), formerly
known as Geo. S. Olive & Co. LLC, has served as the Company's independent
accountants since the Company's formation in 1983.
During the tenure of Olive as the Company's independent accountants, there
were no disagreements with Olive on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure. The
change in accountants does not result from any dissatisfaction with the quality
of professional services rendered by Olive as the independent accountants of the
Company. The change in accountants follows the Company having put its audit and
other outside accounting work out for bid to Olive and Crowe Chizek, which
served as the independent accountants for P.T.C. Bancorp prior to its merger
with the Company on April 30, 1998.
Services provided to the Company and its subsidiaries by Olive with respect
to the fiscal year ended December 31, 1998 included the audit of the Company's
consolidated financial statements and consultations on various tax matters.
Crowe Chizek is expected to provide similar type services to the Company in the
1999 fiscal year.
Representatives of Olive and Crowe Chizek are expected to be present at the
Annual Meeting to respond to appropriate questions and to make such statements
as they desire.
In the event shareholders do not ratify the selection of Crowe Chizek as the
Company's independent accountants for the current fiscal year, such appointment
will be reconsidered by the Board.
THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" RATIFICATION OF THE
APPOINTMENT OF CROWE CHIZEK AS THE COMPANY'S INDEPENDENT ACCOUNTANTS FOR THE
1999 YEAR.
SHAREHOLDER PROPOSALS
Any shareholder proposal intended to be presented at the 2000 Annual Meeting
of Shareholders must be received by the Company by December 2, 1999 in order to
be considered for inclusion in the Proxy Statement for the 2000 Annual Meeting.
The Company's Bylaws establish an advance notice procedure for shareholders
to bring business before an annual meeting of shareholders of the Company (the
"Shareholder Notice Procedure"). The Shareholder Notice Procedure provides that
at an annual meeting only such business may be conducted as has been brought
before the meeting by, or at the direction of, the Board or by a shareholder who
has given timely written notice to the Secretary of the Company of such
shareholder's intention to bring such
13
<PAGE>
business before such meeting. Under the Shareholder Notice Procedure, to be
timely, notice of shareholder proposals to be made at an annual meeting must be
received by the Company not less than 60 days nor more than 90 days prior to the
scheduled date of the meeting (or, if less than 70 days notice or prior public
disclosure of the date of the meeting is given, the 10th day following the
earlier of (i) the day such notice was mailed or (ii) the day such public
disclosure was made).
Under the Shareholder Notice Procedure, a shareholder's notice relating to
the conduct of business must contain certain information about such business and
about the proposing shareholder, including, without limitation, a brief
description of the business the shareholder proposes to bring before the annual
meeting, the reasons for conducting such business at such meeting, the name and
address of such shareholder, the number of shares of Common Stock of the Company
beneficially owned by such shareholder and any material interest of such
shareholder in the business so proposed. If the Chairman of the Board or other
officer presiding at a meeting determines that such business was not brought
before the meeting in accordance with the Shareholder Notice Procedure, such
business will not be conducted at such meeting.
By requiring advance notice of other proposed business, the Shareholder
Notice Procedure is intended to provide an orderly procedure for conducting
annual meetings of shareholders and, to the extent deemed necessary or desirable
by the Board, will provide the Board with an opportunity to inform shareholders,
prior to such meetings, of any business proposed to be conducted at such
meetings, together with any recommendations as to the Board's position regarding
action to be taken with respect to such business, so that shareholders can
better decide whether to attend such a meeting or to grant a proxy regarding the
disposition of any such business.
OTHER MATTERS
The only matters to be considered at the meeting or any adjournment thereof,
so far as known to the Board of Directors, are those set forth in the Notice of
Annual Meeting of Shareholders and routine matters incident to the conduct of
the meeting. However, if any other matters should properly come before the
meeting or any adjournment thereof, the Board of Directors intends that the
persons named in the accompanying proxy form, or their substitutes, will vote
the shares represented by such proxy form in accordance with their best judgment
on such matters.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
All reports and definitive proxy or information statements filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934 subsequent to the date of this Proxy Statement and prior to
the date of the Annual Meeting will be deemed to be incorporated by reference
into this Proxy Statement from the dates of filing of such documents. Any
statement contained in a document incorporated or deemed to be incorporated in
this Proxy Statement shall be deemed to be modified or superseded for purposes
of this Proxy Statement to the extent that a statement contained herein or in
any other subsequently filed document that also is or is deemed to be
incorporated by reference modifies or supersedes such statement.
By order of the Board of Directors,
SUE FAWBUSH
SECRETARY
Greensburg, Indiana
March 31, 1999
14
<PAGE>
INDIANA UNITED BANCORP
GREENSBURG, INDIANA 47240
PROXY FOR 1999 ANNUAL MEETING OF SHAREHOLDERS
(PLEASE COMPLETE, SIGN, DATE AND RETURN PROMPTLY)
The undersigned shareholder of INDIANA UNITED BANCORP ("Company"),
Greensburg, Indiana, does hereby nominate, constitute and appoint DALE J.
DEFFNER, PHILIP A. FRANTZ and EDWARD J. ZOELLER, or any of them (with full
power to act alone), my true and lawful attorney(s) and proxy(ies) with full
power of substitution, for me and in my name, place and stead, to vote all of
the Common Shares of the Company standing in my name on its books at the
close of business on March 12, 1999, at the Annual Meeting of Shareholders to
be held at 201 N. Broadway, Greensburg, Indiana on May 18, 1999 at 10:00 a.m.
(Eastern Standard Time), and at any adjournment thereof, with all the powers
the undersigned would possess if personally present, as follows:
1. ELECTION OF DIRECTORS. To elect as directors the following ten (10)
nominees: Eric E. Anderson, John E. Back, William G. Barron, Dale J.
Deffner, Robert S. Dunevant, Philip A. Frantz, Robert E. Hoptry,
James L. Saner Sr., Dale E. Smith and Edward J. Zoeller
[ ] FOR all nominees (except as otherwise indicated below)
[ ] WITHHOLD AUTHORITY to vote for all nominees
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME ON THE LINE BELOW.)
--------------------------------------------------------------------------
2. RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS. To ratify the
appointment of Crowe Chizek and Company L.L.P. as the Company's
independent accountants for the fiscal year ending December 31, 1999; and
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. OTHER BUSINESS. To transact such other matters as may properly be brought
before the Annual Meeting or any adjournment thereof. The Board of
Directors does not know of any such other matters.)
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL OF THE NOMINEES LISTED IN
ITEM 1 AND A VOTE "FOR" ITEM 2.
<PAGE>
Information regarding the matters to be acted upon at the meeting is contained
in the Notice of Annual Meeting of Shareholders and Proxy Statement
accompanying this proxy.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS AND WILL BE VOTED AS
SPECIFIED AND IN ACCORDANCE WITH THE ACCOMPANYING PROXY STATEMENT. IF NO
INSTRUCTION IS INDICATED, THEN THE ABOVE-NAMED PROXIES, OR ANY ONE OF THEM,
WILL VOTE THE SHARES REPRESENTED "FOR" ALL OF THE NOMINEES LISTED IN ITEM 1
AND "FOR" ITEM 2, AND IN ACCORDANCE WITH THEIR DISCRETION ON ANY OTHER
BUSINESS THAT MAY PROPERLY COME BEFORE THE MEETING.
IN WITNESS WHEREOF, I have hereunto set my hand this ______ day of
____________________, 1999.
- ----------------------------------------------
- ----------------------------------------------
(SIGNATURE OF SHAREHOLDER(S))
PLEASE SIGN ABOVE EXACTLY AS YOUR NAME(S) APPEARS OPPOSITE THE SIGNATURE
LINES. WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR
GUARDIAN, PLEASE GIVE FULL TITLE. IF MORE THAN ONE TRUSTEE, ALL SHOULD SIGN.
ALL JOINT OWNERS MUST SIGN.
An addressed, postage prepaid envelope is enclosed for your convenience in
promptly returning your proxy to the Company. The prompt return of your
proxy will help the Company avoid additional costs in soliciting proxies.
