<PAGE> 1
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SCHEDULE 14A
(RULE 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
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 sec.240.14a-11(c) or sec.240.14a-12
OHIO CASUALTY CORPORATION
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
OHIO CASUALTY CORPORATION
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6 (I) (4) and 0-11.
(1) Title of each class of securities to which transaction applies: . . .
(2) Aggregate number of securities to which transaction applies:. . . . .
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):. . . . . .
(4) Proposed maximum aggregate value of transaction:. . . . . . . . . .
(5) Total fee paid: . . . . . . . . . . . . . . . . . . . . . . . . . . .
[ ] 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
OHIO CASUALTY CORPORATION
136 North Third Street
Hamilton, Ohio 45025
NOTICE OF ANNUAL MEETING
OF
SHAREHOLDERS
To Be Held April 21, 1999
Hamilton, Ohio
March 18, 1999
To the Shareholders:
The Annual Meeting of Shareholders (the "Annual Meeting") of Ohio
Casualty Corporation (the "Company") will be held in the Ohio Casualty
University Auditorium of Ohio Casualty Corporation, 9450 Seward Road,
Fairfield, Ohio, 45014, on Wednesday, April 21, 1999, at 10:30 a.m., local
time, for the following purposes:
(1) To elect the following three Directors for terms
expiring in 2002 (Class III): Arthur J. Bennert,
Catherine E. Dolan and Lauren N. Patch.
(2) In their discretion, to consider and vote upon such
other matters as may properly come before the Annual
Meeting or any adjournment thereof.
Holders of record of common shares of the Company as of the close of
business on March 1, 1999 are entitled to notice of and to vote at the Annual
Meeting and at any adjournment thereof. As of March 1, 1999, there were
31,221,531 common shares outstanding. Each common share is entitled to one
vote on all matters properly brought before the Annual Meeting.
By Order of the Board of Directors,
/s/Howard L. Sloneker III
Howard L. Sloneker III, Secretary
EVERY SHAREHOLDER'S VOTE IS IMPORTANT. IF YOU ARE UNABLE TO BE PRESENT AT
THE ANNUAL MEETING, YOU ARE REQUESTED TO COMPLETE AND RETURN PROMPTLY THE
ENCLOSED PROXY SO THAT YOUR COMMON SHARES WILL BE REPRESENTED. A POSTAGE
PAID, ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
<PAGE> 3
OHIO CASUALTY CORPORATION
136 North Third Street
Hamilton, Ohio 45025
PROXY STATEMENT
---------------
ANNUAL MEETING OF SHAREHOLDERS
Approximate Date to Mail -- March 18, 1999
On behalf of the Board of Directors of Ohio Casualty Corporation (the
"Company"), a proxy is solicited from you to be used at the Company's 1999
Annual Meeting of Shareholders (the "Annual Meeting") scheduled for
Wednesday, April 21, 1999 at 10:30 a.m., local time, in the Ohio Casualty
University Auditorium of Ohio Casualty Corporation, 9450 Seward Road,
Fairfield, Ohio, 45014, or at any adjournment thereof.
Proxies in the form enclosed herewith are being solicited on behalf of
the Company's Board of Directors. The common shares represented by proxies
which are properly executed and returned will be voted at the Annual Meeting,
or any adjournment thereof, as directed. Common shares represented by
proxies properly executed and returned which indicate no direction will be
voted in favor of the nominees of the Board of Directors identified in the
Notice of Annual Meeting accompanying this Proxy Statement. Any shareholder
giving the enclosed proxy has the power to revoke the same prior to its
exercise by filing with the Secretary of the Company a written revocation or
duly executed proxy bearing a later date, or by giving notice of revocation
in open meeting. ATTENDANCE AT THE ANNUAL MEETING WILL NOT, IN AND OF
ITSELF, CONSTITUTE REVOCATION OF A PROXY.
VOTING AT ANNUAL MEETING
As of March 1, 1999, the record date fixed for the determination of
shareholders entitled to notice of and to vote at the Annual Meeting, there
were outstanding 31,221,531 common shares, which is the only outstanding
class of capital stock of the Company. Each such common share is entitled to
one vote on all matters properly coming before the Annual Meeting.
A quorum for the Annual Meeting is a majority of the outstanding common
shares. Common shares represented by signed proxies that are returned to the
Company will be counted toward the quorum in all matters even though they are
marked "Abstain", "Against" or " Withhold Authority" on one or more or all
matters or they are not marked at all. Broker non-votes are also counted for
purposes of determining the presence or absence of a quorum. Broker non-
votes occur when brokers, who hold their customers' shares in street name,
sign and submit proxies for such shares on some matters, but not others.
Typically, this would occur when brokers have not received any instructions
from their customers, in which case the brokers, as the holders of record,
are permitted to vote on "routine" matters, which typically include the
election of directors, but not on non-routine matters.
1
<PAGE> 4
PRINCIPAL SHAREHOLDERS
The table below identifies the only persons known to the Company to own
beneficially (within the meaning of Rule 13d-3 under the Securities Exchange
Act of 1934) more than 5% of the Company's outstanding common shares.
<TABLE>
<CAPTION>
Common Shares Percent
Name and Address Beneficially of Common
of Beneficial Owner Owned Shares Date
------------------- ----- ------ ----
<S> <C> <C> <C>
FIRST NATIONAL BANK OF 3,130,957(1) 10.01% 12-31-98
SOUTHWESTERN OHIO
Third and High Streets
Hamilton, Ohio 45011
CAPITAL RESEARCH AND 2,997,500(2) 9.59% 12-31-98
MANAGEMENT COMPANY
333 South Hope Street
Los Angeles, California 90071
THE INCOME FUND OF AMERICA, INC. 2,280,000(2) 7.29% 12-31-98
333 South Hope Street
Los Angeles, California 90071
THE CHASE MANHATTAN BANK, N.A., 2,240,792(3) 7.17% 12-31-98
Trustee
1211 Avenue of the Americas
New York, New York 10036
JOSEPH L. MARCUM 2,190,816(4) 7.02% 03-01-99
136 North Third Street
Hamilton, Ohio 45025
AMVESCAP PLC 1,641,800(5) 5.25% 12-31-98
11 Devonshire Square
London EC2M 4YR
England
</TABLE>
____________________
(1) Based upon information provided to the Company by First National Bank
of Southwestern Ohio (the "Bank"). The Bank holds the reported
shares as trustee under various trust agreements and arrangements.
The Bank has advised the Company that it has sole voting power for
2,448,889 shares, shared voting power for 0 shares, sole investment
power for 1,346,495 shares, and shared investment power for 1,295,864
shares. 399,019 shares are held under trust arrangements for certain
directors of the Company and their respective spouses, which shares
are also reported in the following table showing share ownership by
directors and executive officers of the Company. The share
information reflects beneficial ownership as of December 31, 1998.
2
<PAGE> 5
(2) Based upon information contained in a Schedule 13G (Amendment No. 1)
dated February 8, 1999, filed with the Securities and Exchange
Commission by Capital Research and Management Company and The Income
Fund of America, Inc. According to the Schedule 13G filing, The
Income Fund of America, Inc. is advised by Capital Research and
Management Company. Capital Research and Management Company reported
sole voting power for 0 shares, shared voting power for 0 shares and
sole investment power for 2,997,500. The Income Fund of America,
Inc. reported sole voting power for 2,280,000 shares, shared voting
power for 0 shares and sole investment power for 0 shares. The
Company has been advised by Capital Research and Management Company
that the same 2,280,000 shares reported to be beneficially owned by
The Income Fund of America, Inc. are also reported to be beneficially
owned by Capital Research and Management Company in the Schedule 13G.
Beneficial ownership information is reported as of December 31, 1998.
(3) 1,398,560 shares are held as trustee for the Company's Employee
Savings Plan and 842,232 shares are held as trustee for the Company's
Employees Retirement Plan. Voting power with respect to shares held
in the Employee Savings Plan is exercised by the plan participants;
investment power with respect to these shares is held by plan
participants subject to limitations in the Plan. Voting and
investment power with respect to shares held in the Employees
Retirement Plan is exercised by the committee which administers the
Employees Retirement Plan (the "Retirement Committee"). The
Retirement Committee consists of Joseph L. Marcum, Lauren N. Patch
and Barry S. Porter.
(4) See share ownership information for Mr. Marcum in the following
table.
(5) Based upon information contained in a Schedule 13G dated February 8,
1999, filed with the Securities and Exchange Commission by AMVESCAP
PLC, the parent holding company for the following subsidiaries which
acquired shares reported by the parent holding company: AVZ, Inc.;
AIM Management Group, Inc.; AMVESCAP Group Services, Inc.; INVESCO,
Inc.; INVESCO North American Holdings, Inc.; INVESCO Capital
Management, Inc.; INVESCO Funds Group, Inc. AMVESCAP PLC reported
sole voting power for 0 shares, shared voting power for 1,641,800
shares, sole dispositive power for 0 shares and shared dispositive
power for 1,641,800 shares as of December 31, 1998.
SHAREHOLDINGS OF DIRECTORS, EXECUTIVE OFFICERS
AND NOMINEES FOR ELECTION AS DIRECTOR
As of March 1, 1999, the directors of the Company, including the three
persons intended by the Board of Directors to be nominated for election as
directors, the executive officers of the Company named in the Summary
Compensation Table, and all executive officers and directors of the Company
as a group, beneficially owned common shares of the Company as set forth
below.
3
<PAGE> 6
<TABLE>
<CAPTION>
Shared Investment/
Number of Options Voting Power
Common Shares Exercisable Over Employees
Name of Beneficially Within Retirement Percent
Individual or Group Owned(1) 60 Days Plan Shares(2) Total of Class (3)
- ------------------- -------- ------- -------------- ----- ------------
<S> <C> <C> <C> <C> <C>
Arthur J. Bennert 16,178 6,000 22,178
Jack E. Brown 1,100 6,000 7,100
Catherine E. Dolan 100 6,000 6,100
Wayne Embry 200 9,000 9,200
Vaden Fitton 227,779(4) 6,000 233,779
Jeffery D. Lowe 169,068(4) 0 169,068
Joseph L. Marcum 1,345,584(4)(5)(6) 3,000 842,232 2,190,816 7.02%
Stephen S. Marcum 215,744(4) 9,000 224,744
Lauren N. Patch 252,605(4)(7) 60,000 842,232 1,154,837 3.69%
Stanley N. Pontius 1,163 9,000 10,163
Howard L. Sloneker III 221,438(7) 16,666 238,104
William L. Woodall 20,700 9,000 29,700
Michael L. Evans 6,131(7) 19,999 26,130
Coy Leonard, Jr. 1,196(7) 6,000 7,196
Barry S. Porter 28,667(7) 19,999 842,232 890,898 2.85%
All Executive Officers 2,757,235 245,664 842,232 3,845,131 12.31%
and Directors as a
Group (38 Persons)
</TABLE>
_______________________________
(1) Unless otherwise indicated, each named person has voting and
investment power over the listed shares and such voting and investment
power is exercised solely by the named person or shared with a spouse.
(2) Includes 842,232 shares held in the Company's Employees Retirement
Plan as to which the named individuals share voting and investment
power solely by reason of being a member of the Retirement Committee
which administers such Plan. See Note (3) of the preceding table.
Messrs. Marcum, Patch and Porter disclaim beneficial ownership of
these shares.
(3) Percentages are listed only for those individuals who are the
beneficial owners of more than 1% of the outstanding shares.
(4) Includes the following number of shares owned by family members as to
which beneficial ownership is disclaimed: Mr. Fitton, 102,857; Mr.
Lowe, 143,750; Mr. Joseph L. Marcum, 611,354; Mr. Stephen S. Marcum,
84,090; and Mr. Patch, 211,847.
(5) Includes 213,852 shares held by Mr. Marcum's wife in her capacity as a
co-trustee of the estate of Howard Sloneker as to which shares Mr.
Marcum has no voting or investment power.
(6) Includes 97,806 shares held as co-trustee of the Joseph L. and Sarah
S. Marcum Foundation as to which voting and investment power is shared
by Joseph L. and Stephen S. Marcum.
4
<PAGE> 7
(7) The share ownership for Messrs. Patch, Sloneker, Evans, Leonard and
Porter includes 4,951; 2,592; 1,447; 183, and 10,259 shares,
respectively, held for the accounts of these individuals by the
trustee of the Company's Employee Savings Plan. Such persons have
sole voting power with respect to these shares and also hold
investment power subject to limitations in the Plan.
ELECTION OF DIRECTORS
The Board of Directors intends that the three persons named under Class
III in the following table (the "Nominees") will be nominated for election at
the Annual Meeting for three-year terms expiring in 2002. The terms of the
remaining directors in Classes I and II will continue after the Annual
Meeting. It is intended that the common shares represented by the
accompanying Proxy will be voted for the election as directors of the
Nominees, unless otherwise instructed on the Proxy. In the event that any
one or more of the Nominees unexpectedly becomes unavailable for election,
the common shares represented by the accompanying Proxy will be voted in
accordance with the best judgment of the proxy holders for the election of
the remaining Nominees and for the election of any substitute nominee or
nominees designated by the Board of Directors. The proxies cannot be voted
for more than three nominees designated by the Board of Directors.
Under Ohio law and the Company's Code of Regulations, the nominees
receiving the greatest number of votes will be elected as directors. Shares
as to which the authority to vote is withheld will be counted for quorum
purposes but will not be counted toward the election of the Nominees.
<TABLE>
<CAPTION>
Position with Company and/or
Principal Occupation or Employment Director
Name and Age(1) During Last Five Years(2) Since
- --------------- ------------------------------------------------------------ --------
<S> <C> <C>
Nominees: Class III--Terms Expiring in 2002: (3)
Arthur J. Bennert, Director of the Company, The Ohio Casualty Insurance Company, 1989
72 West American Insurance Company, American Fire and Casualty
Company, Ohio Security Insurance Company, Ohio Casualty of New
Jersey, Inc. and The Ohio Life Insurance Company; retired
executive officer of the Company and its subsidiaries.
Catherine E. Dolan, Managing Director of the Financial Institutions Group, 1994
41 First Union National Bank, Charlotte, North Carolina.
Lauren N. Patch, President, Chief Executive Officer and Director of the Company, 1987
48 The Ohio Casualty Insurance Company, West American Insurance
Company, American Fire and Casualty Company, Ohio Security
Insurance Company, Avomark Insurance Company, Ohio Casualty of
New Jersey, Inc. and OCASCO Budget, Inc.; Vice Chairman and
Director of The Ohio Life Insurance Company.
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
Position with Company and/or
Principal Occupation or Employment Director
Name and Age(1) During Last Five Years(2) Since
- --------------- ------------------------------------------------------------ --------
<S> <C> <C>
Directors Whose Terms Continue Beyond the Annual Meeting:
Class I -- Terms Expiring in 2000
Jack E. Brown, Chairman of the Board, BBI Marketing Services, Inc., Cincinnati, 1994
55 Ohio (professional marketing consulting firm).
Vaden Fitton, Director and Retired First Vice President of First National 1967
70 Bank of Southwestern Ohio, Hamilton, Ohio.
Joseph L. Marcum, Chairman of the Board and Director of the Company, The Ohio 1949
75 Casualty Insurance Company, West American Insurance Company,
American Fire and Casualty Company, Ohio Security Insurance
Company, Avomark Insurance Company, Ohio Casualty of New Jersey,
Inc., OCASCO Budget, Inc. and The Ohio Life Insurance Company.
Howard L. Sloneker III, Senior Vice President, Secretary and Director of the Company, The 1983
42 Ohio Casualty Insurance Company, West American Insurance Company,
American Fire and Casualty Company, Ohio Security Insurance
Company, Avomark Insurance Company, Ohio Casualty of New Jersey,
Inc. and OCASCO Budget, Inc.; Secretary and Director of The Ohio
Life Insurance Company.
Class II: Terms Expiring in 2001
Wayne Embry, Executive Vice President and General Manager of the Cleveland 1991
62 Cavaliers (professional basketball franchise).
Stephen S. Marcum, Member of the law firm of Parrish, Beimford, Fryman, Smith & 1989
41 Marcum Co., L.P.A., Hamilton, Ohio; such firm has provided legal
services to the Company and its subsidiaries during the last
fiscal year and continues to do so.
Stanley N. Pontius, President and Chief Executive Officer of First Financial Bancorp 1994
52 and its principal subsidiary, First National Bank of Southwestern
Ohio, Hamilton, Ohio.
William L. Woodall, Director of the Company, The Ohio Casualty Insurance Company, West 1986
75 American Insurance Company, American Fire and Casualty Company,
Ohio Security Insurance Company, OCASCO Budget, Inc. and The Ohio
Life Insurance Company; retired executive officer of the Company
and its subsidiaries.
</TABLE>
- ------------------------
(1) Ages are listed as of the date of the Annual Meeting.
(2) The Ohio Casualty Insurance Company, Ohio Security Insurance Company,
American Fire and Casualty Company, West American Insurance Company, OCASCO
Budget, Inc. and The Ohio Life Insurance Company are subsidiaries of the
Company.
(3) Jeffery D. Lowe, who is currently a Class III director whose term
expires in 1999, has decided not to run for re-election at the Annual
Meeting and will resign from the Board effective as of the date of the
Annual Meeting. Because the Board of Directors is still in the process of
identifying and interviewing potential candidates to fill the vacancy to be
created by Mr. Lowe's resignation, the
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<PAGE> 9
Board has not nominated a successor to Mr. Lowe for election at the Annual
Meeting. The Board intends to fill the vacancy following the Annual
Meeting when an appropriate replacement for Mr. Lowe has been selected.
Mr. Lowe, 53, is a director of The Ohio Casualty Insurance Company, West
American Insurance Company, American Fire and Casualty Company, Ohio
Security Insurance Company, Avomark Insurance Company and The Ohio Life
Insurance Company. Mr. Lowe also served as an executive officer of the
Company and its Subsidiaries until December 31, 1996.
OTHER DIRECTORSHIPS AND RELATED TRANSACTIONS AND RELATIONSHIPS
Wayne Embry is also a director of M. A. Hanna Company and Key Bank,
Commercial Line of Business; Vaden Fitton, Stephen S. Marcum and Stanley N.
Pontius are also directors of First Financial Bancorp.
Joseph L. Marcum, the Chairman of the Board of the Company, retired as
the Chief Executive Officer of the Company on December 31, 1993. Mr. Marcum
receives annual benefits from the Company of $146,309 pursuant to the
Company's Employees Retirement Plan. See "Pension Plans."
Jeffery D. Lowe is the son-in-law of Joseph L. Marcum; Lauren N. Patch
and Howard L. Sloneker III are brothers-in-law; and Stephen S. Marcum is the
son of Joseph L. Marcum.
MEETINGS OF THE BOARD OF DIRECTORS
AND COMMITTEES OF THE BOARD
During 1998, the Board of Directors held nine meetings. No director
attended less than 75% of the aggregate number of meetings of the Board of
Directors and the committees on which he or she served. The Board of
Directors has standing Executive, Audit, Executive Compensation and
Nominating Committees.
The Executive Committee did not meet during 1998. The members of the
Executive Committee are Joseph L. Marcum, Lauren N. Patch, and Howard L.
Sloneker III. The Executive Committee is empowered to exercise all the
powers of the Board of Directors in the management of the Company between
meetings of the Board of Directors, other than filling vacancies on the Board
or any other committee of the Board.
The Audit Committee held four meetings during 1998. The members of the
Audit Committee are Arthur J. Bennert, Jack E. Brown, Catherine E. Dolan,
Wayne Embry, Vaden Fitton, Joseph L. Marcum, Stephen S. Marcum, Stanley N.
Pontius and William L. Woodall. Each Audit Committee member attended all of
the meetings in 1998 except Mr. Brown, who attended two meetings. The Audit
Committee's primary function is to meet with the independent auditors for the
Company and to review the Company's internal and independent auditing and
financial controls.
The Executive Compensation Committee held one meeting during 1998. The
members of the Executive Compensation Committee are Jack E. Brown, Vaden
Fitton, Stephen S. Marcum and Stanley N. Pontius. All members of the
Executive Compensation Committee attended the meeting in 1998.
7
<PAGE> 10
The Executive Compensation Committee administers the Company stock option
plans and carries out the responsibilities described in the Executive
Compensation Committee Report in this Proxy Statement.
The Nominating Committee did not meet during 1998. The members of the
Nominating Committee are Jack E. Brown, Wayne Embry, Vaden Fitton, Joseph L.
Marcum, Stephen S. Marcum, Stanley N. Pontius and Howard L. Sloneker III.
The Nominating Committee's responsibilities include the selection of
potential candidates for director and the recommendation of candidates to the
Board.
The Nominating Committee will consider nominees for director
recommended by shareholders for the 2000 Annual Meeting of Shareholders
provided that the names of such nominees are submitted not later than
November 18, 1999, to Howard L. Sloneker III, Secretary, 136 North Third
Street, Hamilton, Ohio 45025.
DIRECTORS' FEES AND COMPENSATION
Each director receives $25,000 for services as a director of the
Company. Each non-employee director of the Company also receives $1,500 per
meeting for attending meetings of the Board of Directors. Members of the
Audit Committee also receive $5,000 each for serving on that committee. In
addition, members of the Executive Compensation Committee receive $300 per
meeting for each meeting attended. Joseph L. Marcum was paid an additional
$65,000 during 1998 as compensation for serving as the Chairman of the Board.
On May 27, 1998, Wayne Embry, Stephen S. Marcum, Stanley N. Pontius
and William L. Woodall, each of whom is a non-employee director of the
Company, were granted a non-qualified stock option (an "NQSO") to purchase
3,000 common shares of the Company at an exercise price of $42.25 per share,
the closing market price of the common shares on the date of grant. Any
individual who becomes or is re-elected a non-employee director is
automatically granted an NQSO to purchase 3,000 common shares effective on
the third business day following the first meeting of the Board of Directors
after his/her election or appointment to the Board. The exercise price of
each NQSO granted to a non-employee director is equal to the fair market
value of the common shares on the date of grant. NQSOs granted to non-
employee directors have terms of ten years (subject to earlier termination in
certain cases) and may not be exercised during the six months following their
date of grant.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table presents information concerning compensation
provided by the Company to its Chief Executive Officer and to each of the
Company's four most highly compensated executive officers, other than the
Chief Executive Officer, for services rendered in all capacities for each of
the Company's last three completed fiscal years:
8
<PAGE> 11
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation Awards
---------------------------------------------------------- --------------------------
Other Securities
Annual Restricted Underlying Dividend
Name and Salary Bonus Compensation Stock Options/ Payment
Principal Position Year ($)(1) ($) ($)(2)(3) Awards($)(4) SARs(#) Rights(#)(5)
------------------ ---- ------- ----- ------------ ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Lauren N. Patch 1998 530,000 32,124 60,601 60,722 30,000 30,000
President and Chief 1997 530,000 0 70,898 98,025 30,000 30,000
Executive Officer 1996 529,560 0 47,881 57,709 30,000 30,000
Barry S. Porter 1998 267,528 13,700 29,051 25,798 10,000 10,000
Chief Financial 1997 258,000 0 32,463 40,165 10,000 10,000
Officer and Treasurer 1996 248,604 0 22,484 24,956 10,000 10,000
Michael L. Evans 1998 220,224 6,867 17,390 11,965 10,000 10,000
Senior Vice President 1997 213,750 0 11,083 6,694 10,000 10,000
1996 199,500 0 19,051 18,686 10,000 10,000
Howard L. Sloneker III 1998 216,838 10,756 22,563 19,186 10,000 10,000
Senior Vice President 1997 209,500 0 23,488 27,760 10,000 10,000
1996 197,698 0 16,603 16,335 10,000 10,000
Coy Leonard, Jr. 1998 170,994 8,722 15,714 15,170 3,000 3,000
Senior Vice President 1997 158,821 0 14,312 18,163 3,000 3,000
1996 132,352 0 7,952 9,446 3,000 3,000
</TABLE>
(1) Includes annual directors' fees for Messrs. Patch and Sloneker.
(2) Includes for Messrs. Patch, Porter, Evans, Sloneker and Leonard for
1998 the amounts of $4,800, $4,800, $4,800, $4,800 and $1,600,
respectively, contributed by the Company under the Company's Employee
Savings Plan. Also includes for Messrs. Patch, Porter, Evans,
Sloneker and Leonard for 1998 the amounts of $10,350, $3,226, $1,549,
$955 and $110, respectively, contributed by the Company under the
Company's Supplemental Executive Savings Plan.
(3) Includes for Messrs. Patch, Porter, Evans, Sloneker and Leonard for
1998, the amounts of $45,451, $21,025, $11,041, $16,808 and $14,004,
respectively, for income taxes incurred as a result of the grant of
restricted shares described in note (4) below. These amounts were
paid in 1999.
(4) The aggregate values of all outstanding restricted stock awards at the
end of the fiscal year 1998 were $143,866, $60,256, $24,547, $40,322
and $25,412 for Messrs. Patch, Porter, Evans, Sloneker and Leonard,
respectively. The number of the restricted stock awards held by
Messrs. Patch, Porter, Evans, Sloneker and Leonard at the end of the
fiscal year 1998 was 3,493, 1,463, 596, 979 and 617, respectively.
Such restricted common shares vest on the third anniversary of the
date of the grant so long as the executive officer is an employee on
such date (with earlier vesting occurring on retirement, death or
disability or termination of employment following a change of
control). During the restriction period, the executive officer will
receive all dividends paid on the shares.
(5) Dividend payment rights were granted to the named executive officers
in 1997, 1998 and 1999. These rights entitle the executive officer on
the April 15th following the third anniversary of the grant date to
receive, for each dividend payment right, an amount in cash equal to
the aggregate amount of dividends that the Company has paid on each
common share from the date on which such right becomes effective
through the payout date subject to certain restrictions.
9
<PAGE> 12
Option Grants in Last Fiscal Year
The following table sets forth information concerning the grant of
stock options during the last fiscal year to each of the executive officers
of the Company named in the Summary Compensation Table. No stock
appreciation rights were granted during the last fiscal year.
<TABLE>
<CAPTION>
% of Total Potential Realizable
Options Value at Assumed
Number of Granted Annual Rates of Stock
Securities to Exercise Price Appreciation for
Underlying Employees or Base Option Term (2)
---------------
Options in Fiscal Price Expiration ($) ($)
Name Granted # (1) Year ($/Sh) Date 5% 10%
---- ------------- --------- -------- ---------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Lauren N. Patch 30,000 24.39 46.9375 02-19-08 885,562 2,244,189
Barry S. Porter 10,000 8.13 46.9375 02-19-08 295,187 748,063
Michael L. Evans 10,000 8.13 46.9375 02-19-08 295,187 748,063
Howard L. Sloneker III 10,000 8.13 46.9375 02-19-08 295,187 748,063
Coy Leonard, Jr. 3,000 2.43 46.9375 02-19-08 88,556 224,419
</TABLE>
(1) All reported stock options were granted pursuant to the Ohio Casualty
Corporation 1993 Stock Incentive Program at the fair market value of
the underlying option shares on the date of grant, become exercisable
as to one-third of the option shares on each of the first three
anniversaries of the date of grant and have a term of ten years. In
the event of a change in control of the Company, the stock options
would become exercisable in full. Stock options reported consist of
incentive stock options and non-qualified stock options.
(2) The dollar amounts under these columns are the result of calculations
at the 5% and 10% annual appreciation rates set by the Securities and
Exchange Commission for illustrative purposes, and, therefore, are not
intended to forecast future financial performance or possible future
appreciation in the price of the Company's common shares. Shareholders
are therefore cautioned against drawing any conclusions from the
appreciation data shown, aside from the fact that optionees will only
realize value from the option grants shown when the price of the
Company's common shares appreciates, which benefits all shareholders
commensurately.
Option Exercises in Last Fiscal Year
The following table sets forth information concerning the exercise of
stock options during the last fiscal year by each of the executive officers
of the Company named in the Summary Compensation Table and the fiscal year-
end value of unexercised stock options and SARs held by such executive
officers:
10
<PAGE> 13
<TABLE>
<CAPTION>
Aggregated Option Exercises in
Last Fiscal Year and Fiscal Year-End Option Value
----------------------------------------------------------
Number of Number of Shares Underlying Value of Unexercised
Shares Unexercised Options at In-the-Money Options
Acquired on Value Fiscal Year-End(#) at Fiscal Year-End($)(1)
--------------------------- ---------------------------
Name Exercise (#) Realized($) Exercisable Unexercisable Exercisable Unexercisable
---- ------------ ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Lauren N. Patch 0 0 30,000 60,000 121,860 0
Barry S. Porter 0 0 9,999 20,001 40,616 0
Michael L. Evans 0 0 9,999 20,001 40,616 0
Howard L. Sloneker III 0 0 6,666 20,001 19,994 0
Coy Leonard, Jr. 0 0 3,000 6,000 12,186 0
</TABLE>
(1) "Value of Unexercised In-the-Money Options at Fiscal Year-End" is
based upon the fair market value of the Company's common shares on
December 31, 1998 ($41.187), less the exercise price of in-the-money
options on December 31, 1998.
Pension Plans
The following table sets forth the estimated annual benefits payable under
the Employees Retirement Plan and The Ohio Casualty Insurance Company Benefit
Equalization Plan (the "Benefit Equalization Plan") to participants in such
plans, including the executive officers named in the Summary Compensation
Table, upon retirement in specified compensation and years of service
classifications:
<TABLE>
<CAPTION>
PENSION PLANS TABLE
15 20 25 30 35 40 45
Annual Earnings Years Years Years Years Years Years Years
- --------------- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
$125,000 $27,802 $37,070 $46,337 $55,604 $64,872 $74,138 $83,407
175,000 39,802 53,070 66,337 79,604 92,872 106,139 119,407
225,000 51,802 69,070 86,337 103,604 120,872 138,139 155,407
275,000 63,802 85,070 106,337 127,604 148,872 170,139 191,407
325,000 75,802 101,070 126,337 151,604 176,872 202,139 227,407
375,000 87,802 117,070 146,337 175,604 204,872 234,139 263,407
400,000 93,802 125,070 156,337 187,604 218,872 250,139 281,407
425,000 99,802 133,070 166,337 199,604 232,872 266,139 299,407
450,000 105,802 141,070 176,337 211,604 246,872 282,139 317,407
475,000 111,802 149,070 186,337 223,604 260,872 298,139 335,407
500,000 117,802 157,070 196,337 235,604 274,872 314,139 353,407
525,000 123,802 165,070 206,337 247,604 288,872 330,139 371,407
550,000 129,802 173,070 216,337 259,604 302,872 346,139 389,407
600,000 141,802 189,070 236,337 283,604 330,872 378,139 425,407
</TABLE>
Retirement benefits under the Company's Employees Retirement Plan, a
defined benefit plan qualified under Section 401(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), are generally payable to full-time and
regular part-time salaried employees whose participation in the plan has
vested (currently requiring the completion of five years of service) upon
retirement at age 65 or in reduced amounts upon retirement prior to age 65 if
the participant has ten years of vested service. A
11
<PAGE> 14
retiree's benefit amount is based upon his or her credited years of service
and average annual compensation (salary) for the five consecutive calendar
years of highest salary during the last ten years of service immediately
prior to age 65 or, if greater, the average annual compensation paid during
the 60 consecutive month period immediately preceding retirement or other
termination of employment. Such retirement benefits are calculated
considering the retiree's Social Security-covered compensation. Benefits
figures shown in the table above are computed on the assumption that
participants retire at age 65 and are entitled to a single life annuity.
Section 401(a)(17) of the Code limits compensation in excess of
$160,000 from being taken into account in determining benefits payable under
a qualified pension plan. As a result, the Benefit Equalization Plan was
adopted for those employees who are adversely affected by these provisions of
the Code. The Benefit Equalization Plan provides for payment of benefits
that would have been payable under the Employees Retirement Plan but for the
limitation on compensation imposed by the Code. Upon retirement,
participants receive the actuarial equivalent present value of the benefit
payable under the Benefit Equalization Plan in a lump sum.
At December 31, 1998, credited years of service and average annual
earnings for purposes of the Employees Retirement Plan and the Benefit
Equalization Plan for the executive officers named in the Summary
Compensation Table were: Lauren N. Patch, 22.5 years ($462,681); Barry S.
Porter, 24.5 years ($244,525); Michael L. Evans, 23.5 years ($192,894);
Howard L. Sloneker III, 16.75 years ($168,628); and Coy Leonard, Jr., 5.4
years ($138,398). The compensation covered by the Employees Retirement Plan
and the Benefit Equalization Plan is the amount shown in the Summary
Compensation Table as salary, less any directors' fees.
REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE
Executive Compensation Policies
The Company's executive compensation programs are designed to
attract and retain quality talent, and to motivate the Company's key
employees to maximize shareholder returns by achieving both the short-term
and long-term goals of the Company. The Executive Compensation Committee
of the Board of Directors (the "Committee"), consisting entirely of non-
employee directors, approves all of the policies under which compensation
is paid or awarded to the Company's executive officers.
The Committee believes that the Company's executive compensation
opportunities, including those for the Company's Chief Executive Officer
("CEO"), should create incentives for superior performance and consequences
for below-target performance. In 1996, the Company's executive
compensation program was re-designed to link each executive officer's
compensation directly to individual and Company performance. A significant
portion of each executive officer's total compensation is now variable and
dependent upon the attainment of annual objectives and long-term
shareholder returns. The compensation structure provides a portion of each
executive officer's compensation in stock thereby creating a mutuality of
interest between executive officers and shareholders.
12
<PAGE> 15
The Committee annually reviews the short-term and long-term
compensation levels for the CEO and other senior executives to consider and
implement any changes necessary to achieve its on-going objectives. In
determining the comparable compensation levels discussed further below, the
Committee considers information from surveys of compensation practices
within the property and casualty industry which surveys may include some or
all of the companies included in the Performance Graph on page 15.
Specific Compensation Programs
There are three components to the Company's "pay for performance"
system established for its officers named in the Summary Compensation Table
on page 8 and 23 additional key executives (collectively called the
"executive officers"): (i) base salary established on an annual basis,
(ii) awards under the Annual Incentive Plan and (iii) awards under the
Long-Term Incentive Plan. Each component of the Company's executive
compensation program aims to accomplish a different purpose.
Base Salary. Base salary levels for the CEO and the other
executive officers of the Company are based on individual performance, the
responsibilities associated with an individual's position in the Company,
skill level and experience and potential future contribution, all of which
are reviewed annually and benchmarked against similar positions within the
survey companies. The base salary of the CEO is established by the
Committee. The base salaries of the other executive officers are
established by the CEO on an annual basis. Salary adjustments are based
on individual performance, as determined in accordance with the Company's
executive performance evaluation system, and reflective of competitive
conditions existing at the time.
Annual Incentive Plan Awards: The potential award opportunities
for each of the executive officers who participates in the Annual Incentive
Plan are determined at the beginning of each fiscal year. Potential award
opportunities for a fiscal year, which are expressed as a percentage of a
participant's salary for that fiscal year, are based on the participant's
level within the organization, with higher percentages being assigned to
executive officers who hold more senior positions. Actual awards are based
on a combination of individual and team performance. This balance supports
the accomplishment of overall objectives and rewards individual
contributions by the executives. Team performance, which accounts for up
to 50% of the total award potential, is based on the Company's actual
performance against pre-determined targets for return on equity and growth
in premiums for the year. A performance threshold for each measure ensures
that no awards are made for substandard accomplishments. If the
performance threshold is achieved, each of the eligible executive officers
receives a team award, the amount of which depends on the extent to which
the Company's performance exceeds the threshold level and the potential
award opportunity assigned to that participant, as described above. The
Executive Compensation Committee determines, based on a recommendation from
the CEO, the level of funding for the individual award pool based on the
performance achieved by the management team on a number of criteria such as
the achievement of pre-established Company and individual goals. The pool
is allocated among the participants on the basis of their performance
evaluations as determined by the CEO (the CEO's performance evaluation is
conducted by the Committee).
13
<PAGE> 16
Currently, awards under the Annual Incentive Plan are paid in cash
(25%) and restricted shares of Company stock (75%). Such restricted shares
may not be transferred by the participant for a three-year period following
the date of the grant, unless the participant dies or his employment is
terminated as a result of disability or retirement or following a change in
control of the Company. If the employment of the participant terminates
for any other reason during such three year period, the restricted shares
will be forfeited to the Company. Awards under the Annual Incentive Plan
for the 1998 fiscal year were paid in the form of cash (25%) and restricted
common shares (75%) issued in February of 1999.
Long-Term Incentive Plan Awards under the Long-Term Incentive Plan
consist of incentive stock options, non-qualified stock options, or a
combination of both, and dividend payment rights, as described below.
Stock options are granted at market value on the date of grant and increase
in value only to the extent of appreciation in the Company's common shares.
Stock options expire at the end of ten years from the date of grant.
Stock option grants are generally made at the beginning of the fiscal year,
although grants may be made at different times to participants who are
promoted or newly hired. The number of stock options to be granted is
based on the participant's salary level and position. While it is the
intention of the Committee to make stock option grants annually, the
Committee has reserved the right to eliminate stock option awards or make
other modifications in the Long-Term Incentive Plan.
Dividend Payment Rights In addition to stock options, the
participants in the Long-Term Incentive Plan may be granted dividend
payment rights. One-third of these rights become effective on each
anniversary of the grant date. These rights entitle the holder on the
April 15th following the third anniversary of the grant date (or earlier if
the holder dies, becomes disabled or retires or is terminated from
employment after a change in control of the Company) to receive, for each
dividend payment right, an amount in cash equal to the aggregate amount of
dividends that the Company has paid on each common share from the date on
which the dividend payment right becomes effective through the payout date.
Unless the employment of the holder of a dividend payment right terminates
as a result of death, disability, retirement at normal retirement age, or
following a change in control, the holder forfeits the right if his or her
employment terminates prior to the scheduled payout date. The employees to
whom stock options and dividend payment rights are to be awarded are
determined annually by the Committee for the executive officers, including
the CEO, and by the CEO for all other officers.
The Company's Annual Incentive Plan and its Long-Term Incentive
Plan are designed to provide participants with the opportunity to receive
total compensation targeted at the 75th percentile of salaries for similar
positions among the survey companies.
Section 162(m) of the Code generally limits the corporate tax
deduction for the compensation paid to executive officers named in the
Summary Compensation Table in the proxy statement to $1 million, unless
certain requirements for qualifying compensation as "performance based" are
met. The compensation paid to each of the executive officers of the
Company in 1998 was less than the threshold for deductibility under Section
162(m).
14
<PAGE> 17
Bases for Chief Executive Officer Compensation
The Committee evaluates the performance of the CEO at least
annually. In 1998, Mr. Patch received a base salary of $505,000. Mr. Patch
also received an award under the Annual Incentive Plan for service in 1998 of
a total of 1,497 restricted common shares of the Company, which were issued
to him in February of 1999 and which will be forfeited to the Company if he
leaves the Company during the three-year period following the date of issue.
As described in detail above, the Committee's determination of the number of
restricted common shares awarded to Mr. Patch (and to all of the other
executive officers) under the Annual Incentive Plan was based on the
Company's 1998 total return performance as measured against established
return on equity and growth in premium targets. The Company also granted to
Mr. Patch in early 1998, pursuant to the Long-Term Incentive Plan, a non-
qualified stock option for 30,000 shares. The number of stock options
granted to Mr. Patch was based on his salary level and position with the
Company. As previously indicated, in establishing the compensation of Mr.
Patch and the other executive officers, the goal of the Committee has been to
create a total compensation opportunity through base salary and awards under
the Annual Incentive Plan and the Long-Term Incentive Plan which, if realized
as a result of the Company's performance, would result in total compensation
being at the 75th percentile for similar positions at the survey companies.
The foregoing report on executive compensation is provided by the
following directors, who constituted the Executive Compensation Committee
during 1998:
Jack E. Brown Vaden Fitton Stephen S. Marcum Stanley N. Pontius
EXECUTIVE COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
The directors of the Company who served as members of the Company's
Executive Compensation Committee during 1998 were Jack E. Brown, Vaden
Fitton, Stephen S. Marcum and Stanley N. Pontius. Mr. Fitton, Mr. Marcum
and Mr. Porter, the Company's Chief Financial Officer and Treasurer, also
served as members of the Executive Compensation Committee of First Financial
Bancorp during 1998, whose Chief Executive Officer, Stanley N. Pontius, is a
member of the Executive Compensation Committee of the Company.
As indicated in the Executive Compensation Committee Report on
Executive Compensation, Lauren N. Patch, the Company's President and Chief
Executive Officer, participates in decision-making regarding the compensation
of certain executive officers named in the Summary Compensation Table. Mr.
Patch is not a member of the Executive Compensation Committee.
15
<PAGE> 18
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
The following graph compares the five-year cumulative total
shareholder return, including reinvested dividends, of the Company with the
Dow Jones Equity Market Index and the Dow Jones Insurance Index for Property
and Casualty Companies(1):
<TABLE>
<CAPTION>
Measurment Period DJ Equity Market DJ Insurance Ohio Casualty
(Fiscal Year Covered) Index P&C Corporation
<S> <C> <C> <C>
1993 100.00 100.00 100.00
1994 100.73 105.21 93.11
1995 138.69 147.38 133.54
1996 170.63 177.23 128.02
1997 228.57 261.10 167.12
1998 294.05 281.94 160.39
- ----------------------
</TABLE>
(1) The Dow Jones Insurance Index for Property and Casualty Companies is
comprised of 11 companies that are traditionally considered as a
peer group of property and casualty insurance companies within the
United States. The companies making up the 1998 Index are Allstate
Corp.; American International Group Inc.; Chubb Corp.; Cincinnati
Financial Corp.; Loews Corp.; MBIA Inc.; Mercury General Corp.; Old
Republic International Corp.; Progressive Corp.; SAFECO Corp.; and
The St. Paul Cos.
ANNUAL REPORT
The Company's Annual Report for the fiscal year ended December 31,
1998, accompanies this Proxy Statement.
16
<PAGE> 19
INDEPENDENT PUBLIC ACCOUNTANTS
PricewaterhouseCoopers, LLP served as independent public accountants
of the Company for the fiscal year ended December 31, 1998, and the Board of
Directors, based on the recommendation of the Audit Committee, has selected
that firm to serve as independent public accountants for the Company for the
fiscal year ending December 31, 1999. A representative of
PricewaterhouseCoopers will be present at the Annual Meeting with the
opportunity to make a statement and/or respond to appropriate questions from
the shareholders.
SHAREHOLDER PROPOSALS AND NOMINATIONS
Proposals of shareholders intended to be presented at the 2000
Annual Meeting of Shareholders scheduled to be held on April 19, 2000, must
be received by the Company no later than November 18, 1999 for inclusion in
the Company's proxy statement and proxy relating to that meeting. Upon
receipt of any such proposal, the Company will determine whether or not to
include such proposal in the proxy statement and proxy in accordance with
applicable rules and regulations promulgated by the Securities and Exchange
Commission.
In order for a shareholder to nominate a candidate for director at a
meeting of shareholders, under the Company's Code of Regulations, timely
notice of the nomination must be received by the Company in advance of the
meeting. Ordinarily, in the case of an annual meeting, such notice of a
proposed nomination must be received by the Company on or before the later of
(1) the first day of February immediately preceding such annual meeting or
(2) the sixtieth day prior to the first anniversary of the most recent annual
meeting of shareholders. The shareholder filing the notice of nomination
must describe various matters regarding the proposed nominee, including such
information as name, address, occupation and shares of the Company held.
These requirements are separate from the requirements a shareholder must meet
in order to have a proposed nominee considered by the Nominating Committee of
the Company's Board of Directors for nomination by the Board of Directors and
inclusion as a nominee in the Company's proxy statement.
The Securities and Exchange Commission has promulgated rules
relating to the exercise of discretionary voting authority pursuant to
proxies solicited by the Company's Board of Directors. If a shareholder
intends to present a proposal at the 2000 Annual Meeting of Shareholders and
does not notify the Company of such proposal by February 3, 2000, or if a
shareholder intends to nominate a director at the 2000 Annual Meeting and
does not comply with the notification requirements described in the preceding
paragraph, the proxies solicited by the Company's Board of Directors for use
at the Annual Meeting may be voted on such proposal or such nominee, as the
case may be, without discussion of the proposal or nominee in the Proxy
Statement for that Annual Meeting.
In each case, written notice must be given to the Secretary of the
Company, whose name and address are: Howard L. Sloneker III, Secretary, Ohio
Casualty Corporation, 136 North Third Street, Hamilton, Ohio 45025.
17
<PAGE> 20
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than ten percent
of a registered class of the Company's equity securities, to file reports of
ownership and changes in ownership on Forms 3, 4 and 5 with the Securities
and Exchange Commission (SEC). Officers, directors and greater than ten
percent shareholders are required by SEC regulations to furnish the Company
with copies of all Forms 3, 4 and 5 they file.
Based on the Company's review of the copies of such forms it has
received, the Company believes that all its officers, directors, and greater
than ten percent beneficial owners complied with all filing requirements
applicable to them with respect to transactions during fiscal 1998.
OTHER MATTERS
The Company files annually with the Securities and Exchange
Commission an Annual Report on Form 10-K. This report includes financial
statements and financial statement schedules.
A SHAREHOLDER OF THE COMPANY MAY OBTAIN A COPY OF THE ANNUAL REPORT
ON FORM 10-K, INCLUDING FINANCIAL STATEMENTS AND FINANCIAL STATEMENT
SCHEDULES, FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998, WITHOUT CHARGE BY
SUBMITTING A WRITTEN REQUEST TO THE FOLLOWING ADDRESS:
OHIO CASUALTY CORPORATION
Attention: Barry S. Porter
Chief Financial Officer/Treasurer
136 North Third Street
Hamilton, Ohio 45025
Management and the Board of Directors of the Company know of no
business to be brought before the Annual Meeting other than as set forth in
this Proxy Statement. However, if any matters other than those referred to
in this Proxy Statement should properly come before the Annual Meeting, it is
the intention of the persons named in the enclosed proxy to vote the common
shares represented by such proxy on such matters in accordance with their
best judgment.
18
<PAGE> 21
EXPENSES OF SOLICITATION
The expense of proxy solicitation will be borne by the Company.
Proxies will be solicited by mail and may be solicited, for no additional
compensation, by officers, directors or employees of the Company or its
subsidiaries, by telephone, telegraph or in person. Brokerage houses and
other custodians, nominees and fiduciaries may be requested to forward
soliciting material to the beneficial owners of common shares of the Company,
and will be reimbursed for their related expenses. In addition, the Company
has retained Morrow & Co., Inc., a professional soliciting organization, to
assist in soliciting proxies from brokerage houses, custodians and nominees.
The fees and expenses of that firm in connection with such solicitation are
not expected to exceed $12,000.
By Order of the Board of Directors,
/s/Howard L. Sloneker III
Howard L. Sloneker III, Secretary
March 18, 1999
19
<PAGE> 22
OHIO CASUALTY CORPORATION
This Proxy is Solicited on behalf of the Board of Directors
ANNUAL MEETING OF SHAREHOLDERS APRIL 21, 1999
Each undersigned shareholder of Ohio Casualty Corporation (the "Company")
hereby constitutes and appoints Joseph L. Marcum and Lauren N. Patch, or
either one of them, with full power of substitution in each of them, the
proxy or proxies of the undersigned to vote at the Annual Meeting of
Shareholders (the "Annual Meeting") of the Company to be held in the
Ohio Casualty University Auditorium of the Ohio Casualty Corporation,
9450 Seward Road, Fairfield, Ohio, on Wednesday, April 21, 1999, at
10:30 a.m., local time, and at any adjournment thereof, all of the common
shares of the Company which the undersigned would be entitled to vote if
personally present at such Annual Meeting, or at any adjournment thereof, as
follows:
(1) TO ELECT THE FOLLOWING THREE (3) DIRECTORS FOR TERMS EXPIRING IN 2002
(CLASS III):
[ ] FOR all nominees listed below (except as marked to the contrary below)*
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below
Arthur J. Bennert Catherine E. Dolan Lauren N. Patch
* INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.
- ------------------------------------------------------------------------------
(2) IN THEIR DISCRETION, TO CONSIDER AND VOTE UPON SUCH OTHER MATTERS (NONE
KNOWN AT THE TIME OF SOLICITATION OF THIS PROXY) AS MAY PROPERLY COME
BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT THEREOF.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFIC INDICATION ABOVE. IN THE ABSENCE OF SUCH INDICATION, THIS PROXY WILL
BE VOTED FOR THE ELECTION OF EACH OF THE ABOVE NOMINEES FOR DIRECTOR. IF ANY
OTHER MATTERS ARE BROUGHT BEFORE THE MEETING, OR IF A NOMINEE FOR ELECTION AS
A DIRECTOR NAMED IN THE PROXY STATEMENT IS UNABLE TO SERVE OR FOR GOOD CAUSE
WILL NOT SERVE, THE PROXY WILL BE VOTED IN THE DISCRETION OF THE PROXIES ON
SUCH MATTERS OR FOR SUCH SUBSTITUTE NOMINEE(S) AS THE DIRECTORS MAY RECOMMEND.
(Continued, and to be executed and dated on the reverse side)
(Continued from other side)
All proxies previously given by the undersigned are hereby revoked. Receipt
of the accompanying Proxy Statement and the Annual Report of the Company for
the fiscal year ended December 31, 1998, is hereby acknowledged.
The signature or signatures to this
proxy should be the same as the name
or names which appear hereon.
Persons signing as attorneys,
executors, administrators, trustees
or guardians should give full title
as such.
Dated: , 1999
-----------------------
-------------------------------------
-------------------------------------
Signature(s) of Shareholder(s)
PLEASE MARK, DATE, SIGN AND RETURN PROMPTLY IN THE ENCLOSED STAMPED ENVELOPE.
