<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [_]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Bryn Mawr Bank
- --------------------------------------------------------------------------------
(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.
[_] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
BRYN MAWR BANK CORPORATION
801 LANCASTER AVENUE
BRYN MAWR, PENNSYLVANIA 19010-3396
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON TUESDAY, APRIL 21, 1998
To Our Shareholders:
Notice is hereby given that the Annual Meeting of Shareholders of Bryn Mawr
Bank Corporation (the "Corporation") will be held in the Centennial Wing of
The Bryn Mawr Trust Company located at the corner of Lancaster Avenue and
Morton Road, Bryn Mawr, Pennsylvania on Tuesday, April 21, 1998, at 2:00 P.M.,
for the following purposes:
1. To elect one (1) director to serve a three (3) year term and four (4)
directors to serve a four (4) year term until their successors are duly
elected and take office.
2. To approve and ratify the amendment of the Corporation's By-Laws by
the Corporation's Board of Directors increasing from twelve (12) to
fourteen (14) the maximum number of directors.
3. To approve and ratify the amendment of the Corporation's Articles of
Incorporation increasing the total number of shares of the Corporation's
authorized capital stock from Five Million (5,000,000) shares to Twenty
Five Million (25,000,000) shares of capital stock.
4. Approval of the Corporation's 1998 Stock Option Plan.
5. To ratify the appointment of Coopers & Lybrand L.L.P. as the
independent certified public accountants for Bryn Mawr Bank Corporation for
the year 1998.
In their discretion the proxies are authorized to act upon such other
matters as may properly come before the meeting. Reference is made to the
accompanying Proxy Statement for details with respect to the foregoing
matters. Only shareholders of record at the close of business on March 2,
1998, are entitled to notice of, and to vote at, the Annual Meeting and any
adjournment or postponement thereof. Such shareholders may vote in person or
by proxy.
By Order of the Board of Directors
of Bryn Mawr Bank Corporation
/s/ Samuel C. Wasson
Samuel C. Wasson, Jr.
Secretary
Bryn Mawr, Pennsylvania
March 6, 1998
IMPORTANT NOTICE
TO ASSURE YOUR REPRESENTATION AT THE ANNUAL MEETING, PLEASE COMPLETE, DATE,
SIGN, AND PROMPTLY MAIL THE ENCLOSED PROXY CARD IN THE RETURN ENVELOPE. NO
POSTAGE IS NECESSARY IF MAILED IN THE UNITED STATES. ANY SHAREHOLDER GIVING A
PROXY HAS THE POWER TO REVOKE IT AT ANY TIME PRIOR TO ITS USE FOR ANY PURPOSE.
ANY SHAREHOLDER WHO IS PRESENT AT THE MEETING MAY WITHDRAW THEIR PROXY PRIOR
TO ITS USE FOR ANY PURPOSE AND VOTE IN PERSON.
<PAGE>
PROXY STATEMENT
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE NO.
--------
<S> <C>
Introduction......................................................... 1
Matters to be Considered at the Annual Meeting of Shareholders..... 1
Date, Time and Place of Annual Meeting............................. 1
Record Date and Voting............................................. 1
Other Matters...................................................... 2
Security Ownership of Certain Beneficial Owners...................... 2
Section 16(a) Beneficial Ownership Reporting Compliance.............. 2
The Corporation's and Bank's Boards of Directors..................... 3
General Information About the Corporation's and Bank's Boards of
Directors......................................................... 3
Information About Committees of the Corporation's Board of
Directors......................................................... 3
Meetings of Corporation's Board and its Committees................. 4
Information About Committees of the Bank's Board of Directors...... 4
Meetings of Bank's Board and its Committees........................ 5
Boards of Directors Compensation..................................... 5
Directors Fees..................................................... 5
Non-Employee Directors Stock Option Plan........................... 5
Directors' Deferred Payment Plans.................................. 5
Biographical Information About Corporation's Directors--Information
About Security Holdings of Corporation's Directors and of the
Corporation's Directors and Executive Officers as a Group........... 6
Corporation's and Bank's Executive Officers.......................... 8
Executive Compensation............................................... 9
General Disclosure Considerations Concerning Executive
Compensation...................................................... 9
Executive Compensation............................................. 9
Summary Compensation Table......................................... 10
Change of Control Agreements....................................... 11
Aggregated Option Exercises and Year-End Option Value Table........ 12
Stock Option and Stock Appreciation Rights Plan.................... 12
Executive Deferred Bonus Plan...................................... 13
Pension Plans...................................................... 13
Pension Plan Table................................................. 14
Bryn Mawr Bank Corporation Thrift and Savings Plan................. 15
Certain Relationships and Related Transactions..................... 16
Stock Price Performance Graph........................................ 16
Compensation Committee Report........................................ 17
Executive Compensation Policy Principles........................... 17
Elements of Executive Compensation Program......................... 17
Salary Compensation and Fringe Benefits............................ 17
Stock Options...................................................... 18
Executive Compensation Decisions................................... 18
Factors and Criteria on Which the Chief Executive Officer's
Compensation Was Based............................................ 18
The Compensation Committees........................................ 18
Proposal 1--Election of Directors.................................... 19
Nominees for Directors............................................. 19
Recommendation of the Board of Directors........................... 19
Proposal 2--Approve and Ratify the Amendment of the Corporation's By-
Laws Increasing the Maximum Number of the Board of Directors from
twelve (12) to fourteen (14) Directors.............................. 19
Recommendation of the Board of Directors........................... 20
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PAGE NO.
--------
<S> <C>
Proposal 3--Approve and Ratify the Amendment of the Corporation's
Articles of Incorporation increasing the Corporation's authorized
shares of Common stock............................................... 20
General Information................................................. 20
Recommendation of the Board of Directors............................ 21
Proposal 4--Approve the Corporation's 1998 Stock Option Plan.......... 22
Background.......................................................... 22
Eligible Directors Interest......................................... 22
Summary of the Plan................................................. 22
Administration of Option Plan....................................... 22
Purpose............................................................. 22
Eligibility......................................................... 23
Stock Options....................................................... 23
Transferability and Exercisability.................................. 23
Federal Tax Treatment of Incentive Stock Options.................... 23
Payment of Withholding Taxes........................................ 23
Option Price........................................................ 23
Exercise of Options................................................. 24
Adjustment Upon Changes in Stock.................................... 24
Change in Control................................................... 24
Amendment and Termination........................................... 24
Federal Tax Treatment of Nonqualified Stock Options................. 24
Effective Date and Duration of the Plan............................. 25
Recommendation of Board of Directors................................ 24
Proposal 5--Ratification of Appointment of Independent Certified
Public Accountants................................................... 25
Other Business........................................................ 25
Shareholder Proposals for 1999........................................ 25
Additional Information................................................ 26
</TABLE>
<PAGE>
PROXY STATEMENT
FOR THE ANNUAL MEETING OF
BRYN MAWR BANK CORPORATION
TO BE HELD ON
APRIL 21, 1998
INTRODUCTION
MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING OF SHAREHOLDERS
This Proxy Statement is being furnished to shareholders of Bryn Mawr Bank
Corporation (the "Corporation") in connection with the solicitation of proxies
by the Corporation for use at the Corporation's Annual Meeting of Shareholders
to be held on Tuesday, April 21, 1998, at 2:00 P.M., or any adjournment or
postponement thereof (the "Annual Meeting"). At the Annual Meeting, the
shareholders will consider and vote upon (1) the election of one (1) director
to serve a three (3) year term and four (4) directors to serve a four (4) year
term until their successors are duly elected and take office; (2) to approve
and ratify the amendment of the Corporation's By-Laws by the Corporation's
Board of Directors increasing from twelve (12) to fourteen (14) the maximum
number of directors; (3) to approve and ratify the amendment of the
Corporation's Articles of Incorporation increasing the total number of shares
of the Corporation's authorized capital stock from Five Million (5,000,000)
shares to Twenty Five Million (25,000,000) shares of capital stock; (4)
approval of the Corporation's 1998 Stock Option Plan; and (5) the ratification
of the appointment of Coopers & Lybrand L.L.P. as the independent certified
public accountants for the Corporation for the year 1998. The proxies are
authorized to transact such other business as may properly come before the
Annual Meeting or any adjournment or postponement thereof. The approximate
date upon which this Proxy Statement and the Proxy are to be mailed to
shareholders is March 6, 1998. The address of the executive office of the
Corporation is 801 Lancaster Avenue, Bryn Mawr, Pennsylvania 19010-3396.
DATE, TIME AND PLACE OF ANNUAL MEETING
The Annual Meeting will be held on Tuesday, April 21, 1998, at 2:00 P.M., in
the Centennial Wing of The Bryn Mawr Trust Company located at Lancaster Avenue
and Morton Road, Bryn Mawr, Pennsylvania.
RECORD DATE AND VOTING
The Board of Directors of the Corporation has fixed the close of business on
March 2, 1998 as the date for determining holders of record of the
Corporation's Common Stock, par value $1.00 per share, entitled to notice of
and to vote at the Annual Meeting or any adjournment or postponement thereof.
Each holder of record is entitled to one vote per share on the matters to be
considered at the Annual Meeting.
The holders of a majority of the outstanding shares of the Corporation's
Common Stock, present either in person or by proxy, will constitute a quorum
for the transaction of business at the Annual Meeting. As of March 2, 1998,
there were shares of the Corporation's Common Stock outstanding.
Shares represented by properly executed proxies will be voted in accordance
with the directions indicated in the proxies unless such proxies have
previously been revoked. Each properly executed proxy on which no voting
directions are indicated will be voted in favor of the adoption of the
proposals recommended by management of the Corporation, and in the discretion
of the proxy agents as to any other matters which may properly come before the
Annual Meeting. A proxy may be revoked by a shareholder at any time prior to
its use for any purpose by giving written notice of such revocation to Samuel
C. Wasson, Jr., the Secretary of the Corporation, at the executive office of
the Corporation, 801 Lancaster Avenue, Bryn Mawr, Pennsylvania 19010-3396 or
by appearing in person at the Annual Meeting and asking to withdraw the proxy
prior to its use for any purpose so that the shareholder can vote in person. A
later dated proxy revokes an earlier dated proxy.
The Corporation does not know at this time of any business, other than that
stated in this Proxy Statement, which will be presented for consideration at
the Annual Meeting. If any unanticipated business is properly brought before
the Annual Meeting, the proxy agents will vote in accordance with their best
judgment.
<PAGE>
OTHER MATTERS
The Corporation will bear the entire cost of soliciting proxies for the
Annual Meeting. In addition to the use of the mails, proxies may be solicited
by personal interview, telephone, telefax and telegram, by the directors,
officers and employees of the Corporation and by the Corporation's wholly-
owned subsidiary, The Bryn Mawr Trust Company (the "Bank"). Arrangements have
been made with brokerage houses and other custodians, nominees and fiduciaries
for forwarding proxy material to beneficial owners of the Corporation's Common
Stock held of record by such persons, and the Corporation will reimburse them
for their expenses in doing so.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information known to the Corporation,
as of January 31, 1998, with respect to the only persons to the Corporation's
knowledge, who may be beneficial owners of more than 5% of the Corporation's
Common Stock.
<TABLE>
<CAPTION>
PERCENTAGE OF
AMOUNT AND NATURE OF OUTSTANDING
BENEFICIAL OWNERSHIP CORPORATION
NAME AND ADDRESS OF CORPORATION COMMON STOCK
OF BENEFICIAL OWNER COMMON STOCK OWNED
------------------- -------------------- -------------
<S> <C> <C>
Thomas J. Carroll 214,200(1) 9.83%
Patrickswell
Post Office Box 488
Middleburg, VA 22117
George W. Connell 150,000 6.88%
121 Cheswold Lane
Haverford, PA 19041-1801
The Banc Funds Company, L.L.C. 109,200 5.01%
208 South LaSalle Street
Chicago, Illinois 60604
The Bryn Mawr Trust Company 122,270 5.61%
Trust Department
10 South Bryn Mawr Avenue
Bryn Mawr, PA 19010
</TABLE>
- --------
(1) Fourteen Thousand (14,000) of the shares reported as beneficially owned by
Mr. Carroll are owned Two Thousand (2,000) shares each by his seven (7)
children who do not reside in his home. Mr. Carroll disclaims beneficial
ownership of such shares.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
that the Corporation's director's and executive officers file reports of their
holdings of the Corporation's Common Stock with the Securities and Exchange
Commission (the "Commission") and with the Nasdaq National Market Exchange on
which the Corporation's Common Stock is traded. Based on the Corporation's
records and other information available to it the Corporation believes that
all the Commission's Section 16(a) reporting requirements applicable to the
Corporation's directors and executive officers for the Corporation's fiscal
years ended December 31, 1996 and 1997 were complied with, except a late
filing of one Form 4 concerning the purchase of fifty-one shares of
Corporation Common Stock by B. Loyall Taylor, Jr.
2
<PAGE>
THE CORPORATION'S AND BANK'S
BOARDS OF DIRECTORS
Currently the By-Laws of the Corporation provide that the Corporation's
business shall be managed by a Board of Directors of not less than eight and
not more than twelve directors. The Corporation's Board, as provided in the
By-Laws, is divided into four classes of directors, with each class being as
nearly equal in number as possible. The Board of Directors has fixed the
number of directors at twelve, with three members in Class I, three members in
Class II, three members in Class III, and three members in Class IV. (SEE,
PROPOSAL 1-- ELECTION OF DIRECTORS)
Under the Corporation's By-Laws, persons elected by the Board of Directors
to fill a vacancy on the Board serve as directors for a term expiring with the
next annual meeting of shareholders, unless the directors are appointed by the
Board after the shareholder record date for that meeting, in which case the
person serves as a director until the annual meeting of shareholders following
that meeting. The directors in each class serve terms of four years each,
unless appointed or elected to fill an unexpired term of office, and until
their successors are elected, qualified and take office.
At their meeting in December of 1997, the Boards of Directors of the
Corporation and the Bank set up a schedule of quarterly meetings for the
Boards of Directors of both the Corporation and the Bank for 1998 in order to
better enable the members of the Boards to fulfill their responsibilities and
to deal with increasing regulations of bank holding companies, their
subsidiary banks and other subsidiaries. Quarterly Board meetings of the
Corporation and the Bank will occur in January, April, July and October. As
part of the reorganization of the Corporation's and Bank's Board and Committee
structures the Risk Management Committee and Executive Committee will each
meet eight times per year in those months when the Boards of Directors do not
meet. The Executive Committees will act in the stead of the Boards of
Directors of the Corporation and the Bank and will have responsibility for
nomination of new directors. The Audit and Trust Committees of the Boards will
meet quarterly preceding each Board of Directors meeting. The Risk Management
Committee will continue to review and manage the material business risks which
confront the Corporation and the Bank.
GENERAL INFORMATION ABOUT THE CORPORATION'S AND BANK'S BOARDS OF DIRECTORS
The Corporation's Board of Directors was scheduled to meet monthly and
during 1997 held thirteen meetings. The Bank's Board of Directors was
scheduled to meet at least monthly and during 1997 held twelve meetings.
INFORMATION ABOUT COMMITTEES OF THE CORPORATION'S BOARD OF DIRECTORS
The Committees of the Corporation's Board of Directors are the Executive,
Risk Management, Audit, and Compensation Committees.
The Executive Committee, comprised of Sherman R. Reed, 3rd (Chairman),
Warren W. Deakins, William Harral, III, Phyllis M. Shea, Robert L. Stevens and
Thomas A. Williams meets when called together to discuss and act upon matters
which require action prior to the next meeting of the Corporation's Board of
Directors and exercises the authority and powers of the Board of Directors at
intervals between meetings of the Board of Directors insofar as may be
permitted by law. During 1997 the Executive Committee held three meetings.
The Executive Committee serves as the Corporation's nominating committee and
in that regard the Committee will consider director nominees recommended by
the shareholders. When submitting a recommendation, shareholders should send
the Secretary of the Corporation biographical information about the candidate,
together with a statement of the candidate's qualifications and any other data
supporting the recommendation. If it is determined that the candidate has no
conflicts of interest or directorships of other companies which would
disqualify the candidate from serving as a director, the candidate's name will
be presented to the Executive Committee for consideration.
3
<PAGE>
The Risk Management Committee, comprised of Thomas A. Williams (Chairman),
Darrell J. Bell, Richard B. Cuff, Peter H. Havens, Wendell F. Holland, Sherman
R. Reed, 3rd, Robert L. Stevens, and Samuel C. Wasson, Jr., meets monthly to
review and manage the material business risks which confront the Corporation
by establishing and monitoring policies and procedures designed to lead to an
understanding of and to identify, control, monitor and measure the
Corporation's material business risks. During 1997 the Risk Management
Committee held twelve meetings.
The Audit Committee, comprised of Darrell J. Bell (Chairman), Richard B.
Cuff, Wendell F. Holland and B. Loyall Taylor, Jr., meets at least once a year
to make or cause to be made a complete examination of the books, papers and
affairs of the Corporation and its subsidiaries and to consider such other
matters as may be required by law. The Audit Committee employs independent
certified public accountants as it deems necessary to make such examination.
During 1997 the Audit Committee held four meetings.
The Compensation Committee, comprised of Sherman R. Reed, 3rd, (Chairman),
Warren W. Deakins, William Harral, III, Phyllis M. Shea and Thomas A. Williams
meets to discuss compensation matters, including determining the numbers of
stock options to be distributed pursuant to the Corporation's 1986 Stock
Option and Stock Appreciation Rights Plan. During 1997 the Compensation
Committee held three meetings.
MEETINGS OF CORPORATION'S BOARD AND ITS COMMITTEES
The total number of meetings of the Corporation's Board of Directors which
were held in 1997 was thirteen meetings. All of the incumbent directors, who
were directors during 1997 (i) attended at least seventy-five percent (75%) of
the total number of meetings of the Board of Directors, and (ii) all directors
attended at least seventy-five percent (75%) of the aggregate of the total
number of meetings held by all committees of the Board on which the director
served, except Peter H. Havens and Phyllis M. Shea.
INFORMATION ABOUT COMMITTEES OF THE BANK'S BOARD OF DIRECTORS
The Committees of the Bank's Board of Directors are the Executive, Risk
Management, Audit, Trust and Compensation Committees.
The Executive Committee, comprised of Sherman R. Reed, 3rd (Chairman),
Warren W. Deakins, William Harral, III, Phyllis M. Shea, Robert L. Stevens and
Thomas A. Williams, meets when called to exercise the authority and powers of
the Bank's Board of Directors at intervals between meetings of the Board of
Directors insofar as may be permitted by law. The Committee held three
meetings during 1997.
The Risk Management Committee comprised of Thomas A. Williams (Chairman),
Darrell J. Bell, Richard B. Cuff, Peter H. Havens, Wendall F. Holland, Sherman
R. Reed, 3rd, Robert L. Stevens and Samuel C. Wasson, Jr. meets monthly to
review and manage the material risks which confront the Bank by establishing
and monitoring policies and procedures to control, monitor and measure loan
quality and concentration, interest rate and market risk, as well as liquidity
risk and other material business risks. During 1997 the Risk Management
Committee held twelve meetings.
The Audit Committee, comprised of Darrell J. Bell (Chairman), Richard B.
Cuff, Wendall F. Holland and B. Loyall Taylor, Jr., meets at least twice a
year to make or cause to be made a complete examination of the books, papers,
and affairs of the Bank, and to consider such other matters as may be required
by law. The Audit Committee employs independent certified public accountants
as it deems necessary to make such examination. The Committee held four
meetings during 1997.
The Trust Committee, comprised of Phyllis M. Shea (Chairman), Warren W.
Deakins, William Harral, III, Peter H. Havens, Robert L. Stevens and B. Loyall
Taylor, Jr. meets monthly and has general supervision over the Trust
Department and over that Department's investments. The Committee held twelve
meetings during 1997.
4
<PAGE>
The Compensation Committee, comprised of Sherman R. Reed, 3rd (Chairman),
Warren W. Deakins, William Harral, III, Phyllis M. Shea and Thomas A. Williams
meets to discuss compensation matters and to approve salaries for officers and
bonuses for the chief executive officer, the other officers named in the
Summary Compensation Table and certain other officers, subject to ratification
by the Board of Directors. The Committee held three meetings in 1997.
MEETINGS OF BANK'S BOARD AND ITS COMMITTEES
The total number of meetings of the Bank's Board of Directors which were
held in 1997 was twelve. All incumbent directors (i) attended at least
seventy-five percent (75%) of the total number of meetings of the Board of
Directors, and (ii) attended at least seventy-five percent (75%) of the
aggregate of the total number of meetings held by all committees of the Board
on which the director served.
BOARDS OF DIRECTORS COMPENSATION
DIRECTORS FEES
During 1997, each non-officer director was paid an annual retainer of
$6,000, payable $1,500 each calendar quarter. In addition each non-officer
director was paid a fee of $750 for attendance at each Board meeting, $350 for
attending the Corporation's organization meeting and $350 for attending any
Board committee meeting. A separate attendance fee is not paid for attending a
Corporation Board meeting held on a Bank Board meeting day.
NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
Under the Corporation's Non-Employee Directors Stock Option Plan, each non-
employee director of the Corporation and the Bank during 1998 will be granted
options to purchase 1,000 shares of Corporation Common Stock. The purchase
price of the stock is the fair market value based on the last sales price of
the stock on the third business day following the date of the Corporation's
Annual Meeting. Each stock option may be exercised within ten (10) years from
the date of grant. Only directors who are elected or appointed to the Board at
or before the Corporation's 1998 Annual Meeting may participate in the
Directors' Stock Option Plan. (SEE, PROPOSAL 4--APPROVAL OF THE CORPORATION'S
1998 STOCK OPTION PLAN)
DIRECTORS' DEFERRED PAYMENT PLANS
Under the Deferred Payment Plans for directors (the "Plans") a director may
defer receipt of a portion or all of the fees paid for service as a director
of the Corporation and Bank. The Plans are non-qualified plans and the Plans'
funds are held in a trust administered by the Bank's Trust Department. Under
the Plans a participating director may elect to invest the deferred director's
fees in a money market fund, a fixed income mutual fund, equity mutual fund,
international equity mutual fund, or in the Corporation's Common Stock. The
right to receive future payments under the Plans is an unsecured claim against
the general assets of the Corporation. Payments of deferred compensation may
be made only in cash or Corporation Common Stock as provided in the Plans.
5
<PAGE>
BIOGRAPHICAL INFORMATION ABOUT CORPORATION'S DIRECTORS--INFORMATION
ABOUT SECURITY HOLDINGS OF CORPORATION'S DIRECTORS AND OF THE
CORPORATION'S DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP
The following table sets forth certain biographical information and
information regarding beneficial ownership of shares of the Corporation's
Common Stock as of March 2, 1998, for each of the Corporation's directors, for
the executive officers as a group and for all directors and executive officers
as a group. Other than as indicated below, each of the persons named below has
been employed in their present principal occupation for the past five years.
<TABLE>
<CAPTION>
AMOUNT AND PERCENTAGE
NATURE OF OF OUTSTAND-
BENEFICIAL ING CORPORATION
NAME, PRINCIPAL OCCUPATION AND AGE AS OF DIRECTOR OWNERSHIP AS OF COMMON STOCK
BUSINESS EXPERIENCE FOR PAST FIVE YEARS MARCH 2, 1998 SINCE(1) MARCH 2, 1998(2)(3) OWNED
---------------------------------------- ------------- -------- ------------------- ---------------
<S> <C> <C> <C> <C>
CONTINUING DIRECTORS
Class I
The terms of the following directors expire
in 1999:
1. Sherman R. Reed, 3rd 69 1973 30,124*** %
Builder and Developer,
President, Sher-Ree,
Inc.
2. Phyllis M. Shea 65 1980 7,380*** %
Attorney-at-Law, Shea
and Shea
3. Thomas A. Williams 62 1992 4,200*** %
Vice President,
Secretary/Treasurer,
Houghton International,
Inc., a specialty
chemical company, since
1991
CONTINUING DIRECTORS
Class II
The terms of the following directors expire
in 2000:
1. Peter H. Havens 43 1986 2,831@# %
Executive Vice President
of the Bank and head of
Investment Management
and Trust Division
since May 1995(4)
2. Robert L. Stevens 60 1974 99,142@ %
Chairman of Corporation
and Bank since December
of 1995, President and
Chief Executive Officer
of the Corporation
since its formation in
1986; President and
Chief Executive Officer
of the Bank since
January, 1980 and prior
to that, its Executive
Vice President since
1968
3. B. Loyall Taylor, Jr. 51 1986 13,961+** %
President, Taylor Gifts,
Inc., mail order
catalog sales
</TABLE>
- --------
* Includes 1,000 shares which the director has the right to acquire by
exercise of stock options granted under the Corporation's Non-Employee
Directors Stock Option Plan.
** Includes 2,000 shares which the director has the right to acquire by
exercise of stock options granted under the Corporation's Non-Employee
Directors Stock Option Plan.
*** Includes 3,000 shares which the director has the right to acquire by
exercise of stock options granted under the Corporation's Non-Employee
Directors Stock Option Plan.
@ Includes 63,480 shares which Mr. Stevens and 17,680 shares which Mr. Wasson
have the right to acquire through exercise of stock options granted under
the Corporation's Stock Option and Stock Appreciation Rights Plan and
17,007 shares held by Mr. Stevens based on his interest in the
Corporation's Thrift and Savings Plan and 1,231 shares held by Mr. Havens
based on his interest in the Corporation's Executive Deferred Bonus Plan
and Thrift and Savings Plan.
# Mr. Havens disclaims beneficial ownership of 1,000 shares held in trust for
the benefit of his wife, Louise A. Havens, 150 shares held in trust for the
benefit of his daughter, Victoria L. Havens, and 150 shares held in trust
for the benefit of his son, Robert H. Havens, who reside in Mr. Havens'
household.
+ Includes 9,612 shares held by Mr. Taylor and 830 held by Mr. Harrall, based
on their interests in the Bank's and Corporation's Deferred Payment Plans
for directors.
6
<PAGE>
<TABLE>
<CAPTION>
AMOUNT AND PERCENTAGE OF
NATURE OF OUTSTANDING
BENEFICIAL CORPORATION
NAME, PRINCIPAL OCCUPATION AND AGE AS OF DIRECTOR OWNERSHIP AS OF COMMON STOCK
BUSINESS EXPERIENCE FOR PAST FIVE YEARS MARCH 2, 1998 SINCE(1) MARCH 2, 1998(2)(3) OWNED
---------------------------------------- ------------- -------- ------------------- -------------
<S> <C> <C> <C> <C>
CONTINUING DIRECTORS
Class III
The terms of the following directors expire in 2001:
1. Warren W. Deakins 59 1990 5,000*** %
Self-employed insurance
sales since January
1993; President and
Chief Executive
Officer, Fidelity
Mutual Group, a life
insurance company, from
September 1989 until
January 1993 and, prior
thereto, President and
Chief Operating Officer
from October, 1984
2. Wendell F. Holland, Esq. 46 1997 1,100* 7%
Vice President
Governmental Relations
and Regulatory Affairs
for American Water
Works Service Company,
Inc. of Voorhees, New
Jersey since December
1996; Counsel to the
law firm of Reed,
Smith, Shaw & McClay
from January 1995 until
December 1996; partner
with the law firm of
LeBoeuf, Lamb, Greene &
MacRae from April 1993
until January 1995, and
Commissioner of the
Pennsylvania Public
Utilities Commission
from November 1990
until April 1993(5)
3. Samuel C. Wasson, Jr. 59 1982 20,157@ 7%
Secretary of the Bank
and Corporation since
January of 1992; Vice
President of the
Corporation since its
formation in 1986 until
January 1992; Vice
Chairman since November
of 1997, Executive Vice
President of the Bank
from November 1993 to
November 1997 and
Treasurer from 1980
until November 1993;
prior to that, a Vice
President of the Bank
since 1969
4. John D. Firestone
NOMINEES FOR DIRECTORS
Class IV
The terms of the following directors expire
in 1998 and if elected to a new term will
expire in 2002:
1. Darrell J. Bell 58 1990 4,200*** %
Retired Senior Vice
President Main Line
Health, Inc. from
October 1993 until
November 1994,
President and Chief
Executive Officer, from
June, 1987 until
October 1993, The Bryn
Mawr Hospital, and
prior thereto, from
April, 1977, Executive
Vice President and
Chief Operating Officer
of the Hospital
2. Richard B. Cuff 66 1983 9,176*** %
Chairman, Cuffco, Inc.,
Cobb & Lawless Service
Co., Inc. and Main Line
Appliances & Custom
Kitchens LTD.,
electrical contracting,
service and retail
sales
3. William Harral, III 58 1995 7,330+** %
Senior Counselor, The
Tierney Group since
June of 1997, President
and Chief Executive
Officer Bell Atlantic-
Pennsylvania, Inc.,
from November, 1994
until June of 1997;
previously Vice
President and Chief
Financial Officer from
May, 1989(6)
4. Nancy Vickers
Executive officers as a
group (9 persons) %
All director nominees,
directors and executive
officers as a group (18
persons) %
</TABLE>
7
<PAGE>
Footnote Information Concerning Directors
(1) Reference to service on the Boards of Directors refers to the Bank only
prior to 1986 and to the Bank and Corporation since 1986.
(2) The number of shares "beneficially owned" in each case includes 100 shares
which each director must own to qualify as a director of the Corporation,
and also includes, when applicable, shares owned beneficially, directly or
indirectly, by the spouse or minor children of the director, and shares
owned by any other relatives of the director residing with the director.
None of the directors holds title to any shares of the Corporation of
record which such director does not own beneficially.
(3) The Corporation does not know of any person having or sharing voting power
and/or investment power with respect to more than 5% of the Corporation's
Common Stock other than Thomas J. Carroll, George W. Connell, The Banc
Funds Company, L.L.C., and the Trust Department of the Bank (See "SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS").
(4) Mr. Havens also serves as a director of Nobel Education Dynamics, Inc.
(5) Mr. Holland serves as a director of Allegheny Power Systems, Inc.
(6) Mr. Harral serves as a director of Charter Power Systems, Inc.
None of the directors is a party to any contract, arrangement or
understanding with respect to any of the Corporation's Common Stock, other
than in connection with (i) the Corporation's Stock Option and Stock
Appreciation Rights Plan, and (ii) the Corporation's Non-Employee Directors
Stock Option Plan.
CORPORATION'S AND BANK'S EXECUTIVE OFFICERS
The following table sets forth certain information with respect to the
current executive officers of the Corporation and Bank as of March 2, 1998:
<TABLE>
<CAPTION>
CORPORATION
STOCK
NAME, PRINCIPAL OCCUPATION AGE AS OF BENEFICIALLY
AND BUSINESS EXPERIENCE MARCH 2, 1998 OFFICE WITH THE CORPORATION AND/OR BANK OWNED
FOR PAST 5 YEARS ------------- --------------------------------------- ------------
<S> <C> <C> <C>
Robert L. Stevens....... 60 Chairman, President and Chief 99,142@
Executive Officer and Director of
Corporation and Bank
Samuel C. Wasson, Jr.... 59 Secretary and Director of Corporation 20,157@
and Vice Chairman, Secretary and
Director of Bank
Peter H. Havens(1)...... 43 Executive Vice President of Bank-- 2,831@+
Investment Management and Trust and
Director of Corporation and Bank
Robert J. Ricciardi..... 49 Vice President of Corporation and 15,594@+
Executive Vice President of Bank--
Chief Credit Policy Officer
Joseph G. Keefer........ 39 Senior Vice President--Chief Lending
Officer
Joseph W. Rebl.......... 53 Treasurer of Corporation and Treasurer 200
and Senior Vice President of Bank--
Finance
Paul M. Kistler, Jr. ... 61 Senior Vice President of Bank--Banking 6,108@
Operations, Human Resources,
Facilities and Information Systems
Thomas M. Petro......... 39 Senior Vice President of Bank-- 6,801@
Community Banking
Leo M. Stenson.......... 47 Senior Vice President and Auditor of 255@
Bank
</TABLE>
- --------
Footnote Information Concerning Executive Officers
@ Includes exercisable stock options and/or the interests of the executive
officers held in the Corporation's Thrift and Savings Plan stated in terms
of the Corporation's shares.
+ Includes interests of the executive officer held in the Corporation's
Executive Deferred Bonus Plan stated in terms of the Corporation's shares.
8
<PAGE>
- --------
(1) Mr. Havens was appointed by the Bank as the Executive Vice President in
charge of the Investment Management and Trust Division of the Bank on May
1, 1995. Mr. Havens was Manager of Kewanee Enterprises, a private
investment company from 1982 until 1995. Mr. Havens has been a director of
the Bank and Corporation since 1986.
EXECUTIVE COMPENSATION
GENERAL DISCLOSURE CONSIDERATIONS CONCERNING EXECUTIVE COMPENSATION
The Corporation believes that its shareholders should be provided clear and
concise information about the compensation of the Bank's executives and the
reasons the Bank's Board of Directors/(3)/ made decisions concerning their
executive compensation, consistent with the Commission's proxy statement
disclosure rules regarding disclosure of executive compensation.
The format and content of the information set forth below is intended to
enable the Corporation's shareholders to understand the rationale and criteria
for the Corporation's and Bank's executive compensation programs and the
compensation paid to the named executives and its other executives and key
employees.
The Corporation welcomes shareholder comment on whether the objective--to
provide information to the Corporation's shareholders that is useful and
clearly stated--has been met. Please send any comments or suggestions for
further improvements in disclosure to Samuel C. Wasson, Jr., Secretary at 801
Lancaster Avenue, Bryn Mawr, Pennsylvania 19010-3396.
EXECUTIVE COMPENSATION
The following information relates to all plan and non-plan compensation
awarded to, earned by, or paid to (i) Robert L. Stevens, the Chairman and
Chief Executive Officer of the Bank, and (ii) the Bank's four (4) most highly
compensated executive officers, other than Mr. Stevens, who were serving as
executive officers of the Bank at December 31, 1997 (Mr. Stevens and such
officers, are hereinafter sometimes referred to as the "Named Executive
Officers").
The following information reflects bonus compensation earned by the Named
Executive Officers during 1997 and paid to them in January 1998. Any
compensation earned by the Named Executive Officers during 1998 will be
reported in the proxy statement for the Corporation's 1999 Annual Meeting of
Shareholders.
- --------
/(3)/ The Corporation's executives are not compensated for their services to the
Corporation rather, because the Bank is the principal subsidiary of the
Corporation, they are compensated as officers of the Bank.
9
<PAGE>
SUMMARY COMPENSATION TABLE
The disclosure regarding the compensation of the Bank's executives includes
the following table that sets forth the compensation paid to the Named
Executive Officers during the last three fiscal years./(4)/
<TABLE>
<CAPTION>
ANNUAL COMPENSATION(1)
----------------------
NAME AND ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS(2) COMPENSATION(3)
------------------ ---- -------- -------- ---------------
($) ($) ($)
<S> <C> <C> <C> <C>
Robert L. Stevens...................... 1997 $224,080 $ 90,000 $4,800
Chairman, President and Chief Executive
Officer 1996 213,072 85,000 4,500
1995 215,070 70,000 4,500
Peter H. Havens........................ 1997 183,072 140,000 4,800
Executive Vice President--Investment 1996 96,586 0 1,869
Management and Trust 1995 117,387 40,000 0
Samuel C. Wasson, Jr. ................. 1997 127,461 60,000 3,750
Vice Chairman and Secretary 1996 117,422 66,000 3,450
1995 117,360 40,000 3,450
Joseph W. Rebl......................... 1997 102,534 45,000 3,000
Senior Vice President--Finance and
Treasurer 1996 96,323 55,000 2,820
1995 96,212 33,000 2,820
Paul M. Kistler, Jr. .................. 1997 101,605 40,000 3,000
Senior Vice President--Banking 1996 96,586 36,500 2,850
Operations, Human Resources, 1995 96,568 30,000 2,850
Facilities and Information Systems
</TABLE>
- --------
(1) A Table for Long-Term Compensation, including an Other Annual Compensation
column is not included because no compensation of this nature is paid by
the Corporation or the Bank and the restricted stock awards and long term
incentive payouts columns are not included in the Compensation Table since
these benefits are not made available by the Corporation or the Bank.
(2) Based on an incentive plan related to Corporation earnings for 1995, 1996,
and 1997, bonuses were awarded to the Named Executive Officers in January
1996, 1997 and 1998.
(3) The Corporation maintains the Bryn Mawr Bank Corporation Thrift and
Savings Plan which was amended and restated to comply with Section 401(k)
of the U.S. Internal Revenue Code, effective January 1, 1985. The amended
Thrift Plan allows employees of each participating employer to contribute,
on a pre-tax basis, up to 16% of their annual base compensation, as
defined in the Plan, but not to exceed $10,000 in 1998. Quarterly, each
participating employer matches the employees' contribution dollar for
dollar to a maximum of 3% of the employee's annual compensation. The
employer matching portion is included in All Other Compensation.
- --------
/(4)/ The Commission's compensation disclosure rules require the use, where
applicable, of a series of tables to describe various types of
compensation paid to the specified executive officers. The use of a
specific table or column in a table is not required by the Commission's
rules if no compensation was paid or awarded to the named executives. Only
the tables or columns required to be used by the Commission's rules,
because of the compensation paid to the specified executive officers, have
been used in this Proxy Statement.
10
<PAGE>
CHANGE OF CONTROL AGREEMENTS
In 1995, at the recommendation of the Corporation's Compensation Committee,
the Corporation's Board of Directors approved Executive Severance Change-of-
Control Agreements (the "Agreements") with its Executive Officers. The
Corporation's Board of Directors has entered into Agreements with the Named
Executive Officers and certain other officers (collectively the "covered
officers"). The Agreements were approved by the outside members of the Board
of Directors.
The Board of Directors believes that the Agreements assure fair treatment of
the covered officers since benefits provided are comparable to termination
benefits afforded by other companies to secure and retain key officers.
Furthermore, by assuring the covered officers some financial security, the
Agreements protect the Corporation's shareholders by tending to neutralize any
bias of those officers in considering proposals to acquire the Corporation.
The Board believes that these advantages outweigh the disadvantage of the
potential cost of the benefits.
The Agreements, which are between the Bank and each of the covered officers,
provide for a lump sum severance benefit if such officers' employment are
terminated under certain circumstances within two years following a "change of
control", as defined in the Agreements, of the Corporation. Such circumstances
include termination of employment other than for "cause" as defined in the
Agreements, or the resignation of such officer following a significant
reduction in the nature or scope of his/her authority, duties or
responsibilities, removal from their position as an officer of the Corporation
or Bank, reduction in base salary of the officer in effect immediately prior
to the change of control, revocation or reduction of benefits payable to the
officer under the Corporation's or Bank's benefit plans, without obtaining the
officer's written consent thereto, transfer of the officer to a location
outside the greater Philadelphia area or the general area of the officer's
principal residence, immediately prior to the change of control, or the
officer being required to undertake business travel substantially greater than
his/her business travel immediately prior to the change of control.
The severance benefit, as determined by the Compensation Committee consists
of (a) an amount in cash equal to three (3) or two (2) times the covered
officer's salary in effect either immediately prior to the termination of
employment or immediately prior to the change of control, whichever is higher,
(b) an amount in cash equal to the excess, if any, of the aggregate fair
market value of the Corporation's Common Stock, that is, the closing price of
the Corporation's Common Stock on the last business day the Common Stock was
traded immediately preceding the termination date (the "Termination Date") of
the covered officer's employment, subject to outstanding and unexercised stock
options, whether vested or unvested, granted to the covered officer under the
Corporation's Stock Option and Stock Appreciation Rights Plan, over the
aggregate exercise price of all such stock options, (c) to the extent not
heretofore paid, the covered officer's salary through the Termination Date and
the officer's salary in lieu of any unused vacation, (d) an amount equal to
all awards earned by the officer in respect of completed plan periods prior to
the Termination Date for the Corporation's Thrift and Savings Plan and the
Bank's annual bonus plan, and payment in respect of such plans for the
uncompleted fiscal year during which termination of employment occurs, (e) the
cost to continue or cause to be continued until thirty-six (36) or twenty-four
(24) whole months for the covered officers after the Termination Date, on the
cost-sharing basis in effect immediately prior to the change of control, the
medical, dental, life and disability insurance benefits substantially
equivalent in all material respects to those furnished by the Bank to the
covered officers immediately prior to the change of control, provided,
however, that the obligation of the Bank to provide such benefits shall cease
at such time as the covered officer is employed on a full-time basis by a
party not owned or controlled by the covered officer, that provides the
covered officer, substantially the same benefits on substantially the same
cost-sharing basis as that between the Bank and the covered officer in effect
immediately prior to the change of control, (f) for both vesting and benefit
calculation purposes, credit with three (3) or two (2) additional, "years of
credited service", (as defined in the Corporation's Pension Plan), for the
covered officers under the Corporation's Pension Plan and Supplemental
Employee Retirement Plan, in addition to the years of credited service that
would have otherwise been calculated by reference solely to the Termination
Date, and (g) the cost of reasonable career counseling services for the
covered officer. To the extent necessary to provide the covered officers with
the additional years of credited service obtainable under the Agreements, the
Corporation has agreed to amend its Supplemental Employee Retirement Plan or
create such supplemental retirement plans as are necessary.
11
<PAGE>
The Agreements terminate in 1998 but are automatically extended for
additional one year periods unless the Bank provides written notice to cancel.
The terms of outstanding Agreements cannot end prior to the expiration of
two(2) years after the occurrence of a Change of Control regardless of any
notice by the Bank to cancel.
In addition to the severance benefits outlined above, each covered officer
would be entitled to receive all other compensation and benefits payable
generally in the event of termination of employment. The aggregate amount of
all such compensation and benefits is subject to a limitation designed to
allow the Bank and Corporation to deduct, for federal income tax purposes, any
payments made pursuant to the Agreements. The Bank may terminate each covered
officer's employment, without liability, under the respective Agreements for
cause as defined therein.
The amount of severance salary benefits each of the Named Executive Officers
would be entitled to, pursuant to the Agreements, if an event which triggered
the payment occurred on the date of the Proxy Statement, is as follows:
Messrs. Stevens $690,000, Havens $540,000, Wasson $450,000, Kistler $330,000,
Rebl $330,000. The total of such severance salary benefit payments for all
covered officers would be $3,847,121.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUE TABLE
The following table sets forth, with respect to each exercise of stock
options during 1997 by each of the Named Executive Officers and the year-end
value of unexercised options on an aggregated basis: (i) the name of the
executive officer (column (a)); (ii) the number of shares received upon
exercise, or, if no shares were received, the number of securities with
respect to which the options were exercised (column (b)); (iii) the aggregate
dollar value realized upon exercise (column (c)); (iv) the total number of
unexercised options held at December 31, 1997, separately identifying the
exercisable and unexercisable options (column (d)); and (v) the aggregate
dollar value of in-the-money, unexercised options held at December 31, 1997,
separately identifying the exercisable and unexercisable options (column (e)).
As of December 31, 1997, there were no stock appreciation rights outstanding.
AGGREGATED OPTION EXERCISES IN 1997 AND DECEMBER 31, 1997 OPTION VALUES(1)
<TABLE>
<CAPTION>
(A) (B) (C) (D) (E)
(#) UNEXERCISED OPTIONS ($) IN-THE-MONEY OPTIONS
(#) SHARES ACQUIRED ($) VALUE ------------------------- -------------------------
NAME IN EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------------- --------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Robert L. Stevens....... 7,200 261,000 63,480 18,120 2,196,536 597,734
Peter H. Havens......... -- -- -- -- -- --
Samuel C. Wasson, Jr. .. 2,200 81,400 17,680 4,520 612,856 148,614
Joseph W. Rebl.......... 4,600 80,921 1,760 2,440 56,786 80,058
Paul M. Kistler, Jr. ... -- -- 4,160 2,040 135,432 66,858
</TABLE>
- --------
(1) Based upon $49.00 per share the last bid price for the Common Stock on
December 31, 1997.
STOCK OPTION AND STOCK APPRECIATION RIGHTS PLAN
In 1993 the Corporation's Board of Directors adopted and in 1994 the
Corporation's shareholders approved a restated Bryn Mawr Bank Corporation 1986
Stock Option and Stock Appreciation Rights Plan (the "Plan"). The
Corporation's Board of Director's Compensation Committee (the "Committee"),
composed of five (5) non-management directors, who are ineligible to receive
grants under the Plan, is authorized to grant stock options ("Option(s)") and
stock appreciation rights ("SAR(s)") to key officers (hereinafter called
"officer(s)") of the Bank selected by the Committee. Up to 183,900 shares of
the Corporation's Common Stock may be issued under the Plan, subject to
adjustment for stock dividends, stock splits and other similar corporate
transactions.
12
<PAGE>
An Option gives the officer the right to purchase a certain number of shares
of the Corporation's Common Stock for a specified price during a specified
period. Options may be either incentive stock options ("ISOs") or nonqualified
stock options, each of which, as described below, results in different federal
income tax consequences to the officer and the Corporation. An officer may
receive the value of an SAR in cash, shares of the Corporation's Common Stock,
or a combination of both, as determined by the Committee. The "value" of an
SAR is equal to the excess of the market price of each share of the
Corporation's Common Stock on the date of exercise over the market price on
the date of grant subject to the limitation that the value of the SAR may not
exceed 200% of the market price on the date of grant. SARs may be granted only
in conjunction with a nonqualified stock option as determined by the
Committee.
Options and SARs may not be exercised before one year from the date of grant
and may not be exercised more than three months after employment terminates
for any reason other than death, disability or retirement of the officer in
which case the officer or the officer's successor in interest, as provided in
the relevant option agreement, shall have the right to exercise the Option
within twelve months of the date of termination of the employment with respect
to any nonqualified stock option or SAR and within twelve months of the date
of death or disability with respect to an ISO, unless the Committee provides
otherwise at the time of grant. Options and SARs may not have a term of more
than ten years, and may not have an exercise price less than the fair market
value of the Corporation's Common Stock on the date of grant.
If the Committee approves, an officer may pay the exercise price of an
Option in shares of the Corporation's Common Stock, which have been held by
the officer for at least one year, having an aggregate fair market value (at
the date of exercise) equal to the exercise price, or in any combination of
cash and Corporation's Common Stock. Officers, who have Options should consult
their tax advisers for the federal, state and local tax consequences in their
specific circumstances.
During 1997, stock options were not granted to any of the Bank's or
Corporation's officers.
EXECUTIVE DEFERRED BONUS PLAN
In 1989, the Corporation established the Deferred Bonus Plan (the "Plan"),
which permits executives of the Bank annually to defer all or a portion of any
bonus (the "Deferred Compensation") which the executives may be awarded. The
Plan is a non-qualified plan and Plan funds are held in a trust administered
by the Bank's Trust Department. Under the Plan the participating executives
may elect to invest the Deferred Compensation in a money market fund, fixed
income mutual fund, equity mutual fund, international equity fund or in the
Corporation's Common Stock. Participants may elect to defer the receipt of the
Deferred Compensation until (i) January of the following year or (ii)
retirement or separation from employment. In certain very limited
circumstances involving a hardship, as defined in the Plan, participants may
request withdrawal of his/her Deferred Compensation. The right to receive
future payments under the Plan is an unsecured claim against the general
assets of the Corporation. Payments of Deferred Compensation may be made only
in cash or Corporation stock as provided in the Plan.
PENSION PLANS
In December 1989, the Corporation assumed sponsorship of the Bank's non-
contributory pension plan (the "Pension Plan") and amended the Pension Plan to
cover the eligible employees of the Corporation and the Bank, (the
"Employer"). Currently only Bank employees are eligible for benefits under the
Plan. Employees of the Bank (collectively called the "participants") become
eligible to participate in the Pension Plan on January 1 following their
attainment of 20 1/2 years of age and performance of six (6) months of service
during which 500 hours of service are credited, as those terms are defined in
the Pension Plan. Benefits under the Pension Plan are paid from a trust for
which the Bank is the trustee. The payments are made monthly under various
options provided for in the Pension Plan, selected by the participants. For
funding purposes it is the Corporation's policy to fund amounts necessary to
maintain the actuarial soundness of the Pension Plan. The Pension Plan is
fully funded and therefore, based on ERISA funding requirements, no
contribution was needed or allowed in 1997.
13
<PAGE>
The net periodic pension cost is computed on the basis of accepted actuarial
methods which include the current year service cost. The Bank's net periodic
pension cost for 1995, 1996 and 1997 was $122,027, $36,675 and ($121,780),
respectively, decreasing the unfunded accrued pension expense for accounting
purposes to $113,346 as of December 31, 1997.
The Corporation's actuaries indicated that the amount of the contribution,
payment or accrual with respect to a participant is not and cannot readily be
separately or individually calculated under the actuarial cost method used in
determining aggregate contribution requirements for the Corporation's Pension
Plan. Covered compensation is the basic rate of salary paid to a participant
including bonus and overtime.
Set forth below is a table of annual pension benefits based on the rates of
salary in various years of service categories for participants retiring at age
65 in 1997.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
----------------------------------------------------
REMUNERATION 15 20 25 30 35 40
------------ ------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$125,000............ $31,552 $ 42,070 $ 52,587 $ 63,104 $ 73,622 $ 81,747
150,000............ 38,302 51,070 63,837 76,604 89,372 99,122
175,000............ 45,052 60,070 75,087 90,104 105,122 116,497
200,000............ 51,802 69,070 86,337 103,604 120,872 133,872
225,000............ 58,552 78,070 97,587 117,104 136,622 151,247
250,000............ 65,302 87,070 108,837 130,604 152,372 168,622
275,000............ 72,052 96,070 120,087 144,104 168,122 185,997
300,000............ 78,802 105,070 131,337 157,604 183,872 203,372
325,000............ 85,552 114,070 142,587 171,104 199,622 220,747
350,000............ 92,302 123,070 153,837 184,604 215,372 238,122
375,000............ 99,052 132,070 165,087 198,104 231,122 255,497
</TABLE>
Differences in the pension benefits table exist because the Pension Plan is
integrated with Social Security benefits, and participants with less income
receive a greater portion of their retirement benefits from Social Security.
The goal of the Pension Plan is to provide long-term participants with annual
benefits from both the Pension Plan and Social Security approximating 60% of
their highest average five year annual compensation.
Benefits paid by the Plan are based on the participants highest average
consecutive five year annual compensation, as defined in the Plan, in the ten
years prior to participant's retirement. The estimated benefits for the
executive officers named in the Summary Compensation Table were based on each
officer's 1997 compensation and do not take into consideration any future
increases in compensation and are straight life annuity amounts which would be
actuarially reduced for a 100% joint and survivor annuity to the officer and
the officer's spouse.
Currently Federal law places certain limitations on the amount of retirement
income that can be paid pursuant to a pension plan qualified under the
Internal Revenue Code, such as the Corporation's Pension Plan. As of December
31, 1997, Messers. Stevens, Havens and Wasson are the only executive officers
participating in the Pension Plan who, based on service to date, would be
affected by such limitations. The Corporation has adopted the Bryn Mawr Bank
Corporation Supplemental Employee Retirement Plan, an unfunded supplemental
plan which is designed to provide those amounts which would be payable as
pension benefits, except for such limitations under the Internal Revenue Code.
The Plan is a non-qualified plan and Plan funds are held in a trust
administered by the Bank's Trust Department. The right to receive future
payments under the Plan is an unsecured claim against the general assets of
the Corporation.
For the Named Executive Officers in the Summary Compensation Table, the
estimated annual benefits upon normal retirement at age 65 under the Pension
Plan are as follows: Robert L. Stevens, $195,767, Samuel C. Wasson, Jr.,
$112,816, Peter H. Havens, $69,165, Joseph W. Rebl, $64,233, and Paul M.
Kistler, Jr., $16,945. Messrs. Stevens, Wasson, Havens, Rebl and Kistler, have
38, 32, 2, 16 and 4 credited years of service, respectively, under the Pension
Plan.
14
<PAGE>
BRYN MAWR BANK CORPORATION THRIFT AND SAVINGS PLAN
In December of 1989, the Corporation assumed sponsorship of the Bank's
Thrift and Savings Plan and amended the plan to cover eligible employees of
the Corporation and the Bank, (the "Employer"). An employee of the Corporation
or the Bank, (collectively called the "participants") becomes eligible to
participate in the Bryn Mawr Bank Corporation Thrift and Savings Plan (the
"Thrift Plan") on January 1st or July 1st following his/her attainment of 20
1/2 years of age and performance of six (6) months of service during which 500
hours of service are credited as those terms are defined in the Thrift Plan.
Participants may elect to have what would otherwise be his/her compensation
reduced and cause the amount of such reduction to be contributed, on his/her
behalf, to the Thrift Plan's related trust in an amount from 1% to 16% of
his/her compensation. The Employer makes a dollar for dollar matching
contribution, up to 3% of each participant's base compensation. All
participants may elect to contribute after-tax dollars to the Thrift Plan's
related trust in an amount from 1% to 10% of his/her compensation but the
Employer will not match such contributions. In any Thrift Plan year the
Employer may make contributions to the participants' discretionary accounts in
the Thrift Plan of such portions of its net profits as the Employer's Board of
Directors may determine, subject to certain limitations in the Thrift Plan.
The Thrift Plan permits a participant to cause the participant's account
balance to be invested in one or more of five different investment funds,
including an investment in the Corporation's Common Stock. As of December 31,
1997, the Thrift Plan's related trust held 51,882 shares of the Corporation's
Common Stock for the benefit of 108 participants. Each such participant or
beneficiary owns an undivided interest in the whole of the Corporation's
Common Stock Fund of the Thrift Plan. Under the terms of the Thrift Plan and
its related trust agreement, the trustee possesses the power and authority to
vote the Corporation's Common Stock.
15
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Some of the directors and executive officers of the Bank and the companies
with which they are associated were customers of, and had banking transactions
with, the Bank in the ordinary course of its business during 1997. All loans
and commitments to lend were made 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 Bank management, the loans
and commitments did not involve more than a normal risk of collectability or
present other unfavorable features.
[GRAPH APPEARS HERE]
16
<PAGE>
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Bank's Board of Directors (the "Bank
Compensation Committee") is composed entirely of independent outside directors
(see Information About Committees of the Bank's Board of Directors). The Bank
Compensation Committee is responsible for setting and administering the Bank's
compensation policies, including those which govern salary and the bonus
program applicable to the Bank's executive officers including the Named
Executive Officers.
The Compensation Committee of the Corporation's Board of Directors (the
"Corporation Compensation Committee") is composed entirely of independent
outside directors (see Information About Committees of the Corporation's Board
of Directors). The Corporation's Compensation Committee is responsible for
setting and administering the policies which govern the grant to key Bank
personnel of options to purchase the Corporation's stock including the Named
Executive Officers.
EXECUTIVE COMPENSATION POLICY PRINCIPLES
The Bank's compensation policy is designed to (i) retain and attract highly
qualified key executives essential to the long-term success of the Bank and
Corporation; (ii) reward such executives for consistent successful management
of the Bank and enhancement of shareholder value; and (iii) create a
performance-oriented environment that rewards performance not only with
respect to the Bank's goals but also the Bank's performance in relation to
comparable industry performance levels.
The Bank's Compensation Committee annually considers the Bank's economic
performance in terms of its asset diversification and quality, expense levels,
net income, capital accumulation and retention, return on equity and other
relevant criteria used in the financial services industry and seeks to relate
those considerations to the Bank's performance and each executive's
performance of his duties.
The Bank's executive compensation program, established by the Bank
Compensation Committee, is based on the belief that each executive officer's
compensation should bear a relationship to the business success of the Bank
and Corporation, the value of the Corporation's stock and any significant
accomplishments by that executive officer.
ELEMENTS OF EXECUTIVE COMPENSATION PROGRAM
The Bank's total compensation program for its executive officers currently
consists of base salary, a fringe benefit package, and an opportunity,
depending on the Bank's annual earnings, the executive officers' divisions'
net income and other economic criteria, to obtain a cash bonus and options to
purchase Corporation stock at the market price or a premium above the market
price determined by the Corporation's Compensation Committee when such options
are awarded.
SALARY COMPENSATION AND FRINGE BENEFITS
The salary compensation is competitive with other financial institutions in
the Delaware Valley and is combined with a fringe benefit package designed to
retain and attract experienced and highly professional banking personnel. Each
Named Executive Officer's salary is based on that person's level of management
responsibility at the Bank and performance of duties and will be reviewed
annually.
The Bank's officers, including the Named Executive Officers, have an
opportunity to be awarded a cash bonus based in large measure on his/her
divisions' net income, the economic performance of the Bank on an annual basis
and each individual officer's accomplishment of his/her designated
responsibilities and goals. Bonuses paid to the Named Executive Officers,
which were determined on the basis of the executive officers' divisions' and
Bank's earnings performance in 1997 and were paid in January of 1998,
reflected the Bank's continued earnings improvement.
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STOCK OPTIONS
Stock options were last awarded to the Bank's executive officers in 1994. No
additional stock options will be awarded unless approved by the Corporation's
Compensation Committee.
EXECUTIVE COMPENSATION DECISIONS
The Bank Compensation Committee evaluated the Bank's business performance
for 1997 and determined, based on such performance and the criteria outlined
above, that in January of 1998 salary increases be granted and bonuses be
awarded to the Named Executive Officers.
FACTORS AND CRITERIA ON WHICH THE CHIEF EXECUTIVE OFFICER'S COMPENSATION WAS
BASED
The Bank Compensation Committee met, Mr. Stevens being present, to evaluate
his performance and review his compensation package. The Bank Compensation
Committee reports on that evaluation to the independent directors of the
Board. Mr. Stevens is eligible to participate in all executive compensation
programs available to all other executives.
As indicated in the foregoing discussion concerning the principles upon
which the Bank's compensation policy is based, the Bank's economic performance
and the performance by Mr. Stevens of his duties as Chief Executive Officer
are the essential elements upon which his compensation was based. Also
considered by the Bank Compensation Committee was the continuing improvement
over the last five (5) years in the Bank's fundamental economic strength.
In determining Mr. Stevens' 1997 annual compensation, specifically the bonus
awarded to Mr. Stevens, the primary economic performance criteria which the
Bank Compensation Committee considered was the fact that the Bank's economic
performance exceeded the economic goals specified in its 1997 plan and that
exceeding its goals resulted in the Bank increasing annual earnings,
accumulating additional capital and increasing regulatory capital ratios, as
well as an increase in value of the Corporation's stock and the dividends paid
on the Corporation's stock.
THE COMPENSATION COMMITTEES
The Bank's and Corporation's Compensation Committees are composed of the
same members consisting of Sherman R. Reed, 3rd, Chairman, Warren W. Deakins,
Phyllis M. Shea, William Harral, III and Thomas A. Williams who each endorsed
this report.
Respectfully submitted:
Sherman W. Reed, 3rd, Chairman
Warren W. Deakins
William Harral, III
Phyllis M. Shea
Thomas A. Williams
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PROPOSAL 1
ELECTION OF DIRECTORS
(ITEM 1 ON THE PROXY CARD)
One of the purposes of the Annual Meeting is the election of five (5)
directors to the Board of Directors of the Corporation. If the proposed
amendment to the Corporation's By-Laws increasing the number of the
Corporation's directors from twelve (12) to fourteen (14) directors is
approved by the shareholders (See Proposal 2: APPROVAL OF AN AMENDMENT TO THE
BY-LAWS REGARDING THE INCREASING OF THE MAXIMUM NUMBER OF DIRECTORS FROM
TWELVE (12) TO FOURTEEN (14)), one (1) director will be elected to Class III
and four (4) directors will be elected to Class IV. Such directors will serve
for the terms indicated below.
NOMINEES FOR DIRECTORS
The following directors have been nominated by the Corporation's Board of
Directors for election as directors to serve as follows:
(i)Class III--Term to Expire in 2001:
(1)John D. Firestone
(ii)Class IV--Term to Expire in 2002:
(1)Darrell J. Bell
(2)Richard B. Cuff
(3)William Harral, III
(4)Nancy Vickers
and until their successors are elected and take office.
If the amendment to the By-Laws is not adopted and approved by the
Corporation's shareholders, (i) a new director will not be elected to Class
III and (ii) only the first three (3) directors in Class IV will be elected
for a term of four (4) years to Class IV.
The persons named as proxies in the accompanying form of proxy have advised
the Corporation that, unless otherwise instructed, they intend at the meeting
to vote the shares covered by proxies for the election of the nominees named
in this Proxy Statement. If one or more of the nominees should, at the time of
the Annual Meeting, be unavailable or unable to serve as a director, the
shares represented by the proxies will be voted to elect any remaining
nominee. The Board of Directors knows of no reason why the nominees will be
unavailable or unable to serve as directors. The Corporation expects all
nominees to be willing and able to serve as directors.
----------------
The affirmative vote of the holders of at least a majority of the
Corporation's shares of Common Stock present in person or by proxy at the
Annual Meeting is required for the election of the nominees for directors.
Proxies solicited by the Board of Directors will be voted for nominees listed
above, unless the shareholders specify a contrary choice in their proxies.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES LISTED ABOVE.
PROPOSAL 2
APPROVAL OF AN AMENDMENT TO
THE BY-LAWS REGARDING INCREASING THE MAXIMUM NUMBER OF DIRECTORS FROM TWELVE
(12) TO FOURTEEN (14)
(ITEM 2 ON THE PROXY CARD)
The Board of Directors has determined that an amendment to the Corporation's
By-Laws to increase the maximum number of directors from twelve (12) to
fourteen (14) directors is advisable and has voted to recommend the amendment
of the Corporation's By-Laws for approval and adoption by the Corporation's
shareholders. The reasons for the amendment of the By-Laws are to (i) add
additional knowledgeable individuals to the Board, and (ii) better enable the
Bank to address the highly competitive and regulated economic environment in
which a financial services entity must compete and to expand and better serve
the needs of the community which the Corporation and Bank serve. Exhibit A to
this Proxy Statement sets forth the full text of the amendments to the
Corporation's By-Laws.
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After carefully considering this matter, on February 20, 1998, the Executive
Committee of the Corporation's Board approved and adopted amendments to the
Corporations's By-Laws in the form of Exhibit A to the Proxy Statement.
RECOMMENDATION OF THE BOARD OF DIRECTORS
On the basis of the foregoing, the Board of Directors believes that its
proposal to amend the By-Laws for the purpose of increasing the number of
directors is in the best interests of the Corporation and its shareholders,
and recommends that the proposal be approved by the shareholders. Accordingly,
the following resolutions are presented to the shareholders at the 1998 Annual
Meeting:
RESOLVED, that the amendment to the Corporation's By-Laws on Exhibit A
attached to and incorporated by reference into this Proxy Statement,
adopted on February 20, 1998 is hereby approved and ratified;
RESOLVED FURTHER, that the appropriate officers of the Corporation are
hereby authorized and directed to revise the By-Laws, as amended, by the
amendments on Exhibit A hereto and to file such By-Laws, as amended with
the Corporation's Corporate Secretary so that the Corporation's By-Laws, as
amended by Exhibit A, will become effective as specified in the foregoing
resolution; and
RESOLVED FURTHER, that the appropriate officers of the Corporation are
hereby authorized, empowered and directed to do all things necessary and
desirable to carry out the intent and purposes of the foregoing
resolutions.
----------------
The affirmative vote of at least a majority of the shares of the
Corporation's Common Stock entitled to vote at the Annual Meeting, present in
person or by proxy, will be required for approval and ratification of the
amendment to the By-Laws solicited on behalf of the Board and will be voted
for the foregoing resolutions unless shareholders specify a contrary choice in
their proxies.
THE BOARD RECOMMENDS A VOTE FOR THE FOREGOING RESOLUTIONS TO APPROVE AND
RATIFY THE AMENDMENT TO THE BY-LAWS OF THE CORPORATION.
PROPOSAL 3
TO APPROVE AND RATIFY THE AMENDMENT
OF THE CORPORATION'S
ARTICLES OF INCORPORATION
(ITEM 3 ON THE PROXY CARD)
TO APPROVE AND RATIFY THE AMENDMENT OF THE CORPORATION'S ARTICLES OF
INCORPORATION BY THE CORPORATION'S BOARD OF DIRECTORS TO INCREASE THE NUMBER
OF AUTHORIZED SHARES OF COMMON STOCK FROM FIVE MILLION (5,000,000) SHARES TO
TWENTY FIVE MILLION (25,000,000) SHARES.
The Board recommends approval and ratification by the Corporation's
shareholders of amendments to the Corporation's Articles of Incorporation
increasing the number of authorized shares of Common Stock from Five Million
(5,000,000) shares to Twenty Five Million (25,000,000) shares.
GENERAL INFORMATION
The Articles of Incorporation of the Corporation, as presently in effect,
provide that the authorized capital of the Corporation shall consist
exclusively of Five Million (5,000,000) shares of Common Stock, par value
$1.00 per share. As of , 1998, there were shares of Common Stock
outstanding. In addition, as of that date shares of Common Stock were
reserved for issuance pursuant to the Corporation's stock option plans. Thus,
shares of Common Stock are currently available for future financing,
acquisitions and other corporate purposes.
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On January 15, 1998, the Board of Directors adopted a resolution to amend
the Articles of Incorporation of the Corporation for the purpose of increasing
the number of authorized shares of Common Stock from Five Million (5,000,000)
shares to Twenty Five Million (25,000,000) shares. The Board of Directors
believes that it is desirable to have additional authorized shares of Common
stock available for issuance for the purpose of raising additional capital and
for use in connection with acquisitions, stock dividends, stock splits,
employee benefit plans and for other general corporate purposes. Having
additional authorized shares of Common Stock available for issuance in the
future would provide the Corporation with greater flexibility in pursuing such
corporate purposes and would allow additional shares to be issued without the
expense and delay of further amendments to the Articles of Incorporation,
which would require shareholder approval at an annual or special shareholders
meeting. In addition, the rules of the NASDAQ National Market System, on which
the Corporation Common stock trades, may require shareholder approval before
additional shares could be issued under certain circumstances. The Corporation
has no present plan or intention to issue any additional shares of Common
Stock, except (i) for shares which will be reserved for issuance in
connection with the Corporation's existing stock option plans and (ii) for
shares which will be reserved for issuance in connection with the
Corporation's 1998 Stock Option Plan if it is approved by the Corporation's
shareholders at the 1998 Annual Meeting.
The additional shares of the Corporation Common Stock for which
authorization is sought from the Corporation's shareholders would be part of
the existing class of Common Stock and, if and when issued, would have the
same rights and privileges as the shares of Common Stock presently
outstanding. The holders of the Corporation's Common Stock do not have
preemptive rights in connection with the issuance of additional shares of
Common Stock.
If approved by the Corporation's shareholders, the proposed amendment will
become effective upon the filing of Articles of Amendment with the Secretary
of State of the Commonwealth of Pennsylvania. Under the By-Laws of the
Corporation, the affirmative vote of a majority of the outstanding shares
entitled to vote is required in order to approve the proposed amendment.
The proposed amendment to increase the number of authorized shares of Common
Stock is not proposed to discourage a takeover or change in control of the
Corporation. Nevertheless, in certain instances, a proposal to increase the
amount of authorized stock may have an anti-takeover effect. In the event that
a hostile takeover of the Corporation is threatened, the Board of Directors
could issue shares of Common Stock to dilute the stock ownership of persons
seeking to obtain control of the Corporation.
After carefully considering this matter, on January 15, 1998, the
Corporation's Board approved and adopted amendments to the Corporation's
Articles of Incorporation.
RECOMMENDATION OF THE BOARD OF DIRECTORS
On the basis of the foregoing, the Board of Directors believes that its
proposal to amend the Articles of Incorporation for the purpose of increasing
the number of authorized shares of Common Stock is in the best interests of
the Corporation and its shareholders, and recommends that the proposal be
approved by the shareholders. Accordingly, the following resolutions are
presented to the shareholders at the 1998 Annual Meeting:
RESOLVED, that the proposal of the Board of Directors to amend the
Articles of Incorporation of Bryn Mawr Bank Corporation for the purpose of
increasing the number of authorized shares of Common Stock from Five
Million (5,000,000) shares to Twenty Five Million (25,000,000) shares be,
and is hereby approved and adopted by the shareholders of the Corporation;
and
RESOLVED FURTHER, that the officers and directors of the Corporation be,
and are hereby authorized and empowered on behalf of the Corporation to
execute and file Articles of Amendment to the Articles of Incorporation and
to take all such other actions as they may determine in their discretion to
be necessary or appropriate in order to effect the foregoing amendment to
the Articles of Incorporation.
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----------------
The affirmative vote of at least a majority of the shares of the
Corporation's Common Stock entitled to vote at the Annual Meeting, present in
person or by proxy, will be required for approval and ratification of the
amendment to the Articles of Incorporation solicited on behalf of the Board
and will be voted for the foregoing resolutions unless shareholders specify a
contrary choice in their proxies.
THE BOARD RECOMMENDS A VOTE FOR THE FOREGOING RESOLUTIONS TO APPROVE AND
RATIFY THE AMENDMENT TO THE ARTICLES OF INCORPORATION OF THE CORPORATION.
PROPOSAL 4
TO APPROVE THE ADOPTION OF THE
BRYN MAWR BANK CORPORATION
1998 STOCK OPTION PLAN
(ITEM 4 ON THE PROXY CARD)
BACKGROUND
The Board of Directors of the Corporation is recommending for shareholder
approval the adoption of a Corporation 1998 Stock Option Plan (the "Plan")
which provides for the grant of certain stock options to directors of the
Corporation who are not employees of the Corporation or any affiliate of the
Corporation (the "Eligible Directors") and key employees, including officers
of the Corporation and its direct and indirect subsidiaries (the "Employees").
Under the Plan, an amount equal to five percent (5%) of the outstanding shares
of Common Stock of the Corporation on March 2, 1998 (that is a maximun of
shares ( ) shares of Corporation Common Stock), will be available for the
grant of options to the Employees and Eligible Directors. The options for the
Common Stock are to be granted in consideration for the services provided to
the Corporation by the Employees and the Eligible Directors.
Acting on the recommendation of the Compensation Committee of the
Corporation's Board of Directors, on January 15, 1998, the Board of Directors
approved the BRYN MAWR BANK CORPORATION'S 1998 STOCK OPTION PLAN subject to
adoption by the Corporation's shareholders. The Board of Directors directed
that the Plan be submitted to the shareholders of the Corporation for their
approval at the 1998 Annual Meeting to be held on April 21, 1998.
ELIGIBLE DIRECTORS INTEREST
Because the Eligible Directors are eligible to receive awards under the
Plan, each of them has a personal interest in approval of this proposal. As of
March 2, 1998, there were nine (9) Eligible Directors on the Board of
Directors, each of whom will participate in the Plan.
SUMMARY OF THE PLAN
The following is a summary of the Plan and is qualified in its entirety by
reference to the Plan, a copy of which is attached to the Proxy Statement as
Exhibit B.
ADMINISTRATION OF OPTION PLAN
The Plan is administered by the Corporation's Compensation Committee, which
is composed of four (4) or more directors who are eligible to receive Stock
Options under the Plan. Subject to the terms of the Plan, and to such
approvals and other authority as the Board of Directors may reserve to itself
from time to time, the Committee may adopt, amend, or rescind Rules and
Regulations, and make other determinations for carrying out the Plan that the
Committee deems necessary or appropriate. The Board of Directors has reserved
the power to review and approve the Committee's determinations.
PURPOSE
The stated purpose of the Plan is to promote the interests of the
Corporation and its shareholders by strengthening the Corporation's ability to
retain and attract the services of experienced and knowledgeable Employees and
Outside Directors and by encouraging such Employees and Outside Directors to
acquire an increased proprietary interest in the Corporation.
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ELIGIBILITY
Persons eligible to receive Stock Options are the Employees and Eligible
Directors at the time of the grant of the Stock Option.
STOCK OPTIONS
Options granted under the Plan may be either incentive stock options or non-
qualified stock options, as the Committee determines to be in the best
interests of the Corporation at the time of the grant of options.
TRANSFERABILITY AND EXERCISABILITY
No option granted under the Plan is transferable by the optionee, other than
by will or the law of descent and distribution, and during the Participant's
lifetime the option may be exercised only by him/her or his/her legal
representative. Except as otherwise provided by the Compensation Committee, in
the event of the Participant's death at a time when he/she is entitled to
exercise an option, then, during the option term, at any time within twelve
(12) months after his/her death such option may be exercised, in full or in
part as to shares which the Participant was entitled to purchase at his/her
death, by his/her executor or administrator or other person to whom the option
is transferred by will or the applicable laws of descent and distribution.
Except as otherwise provided by the Compensation Committee, in the event of
the Participant's termination of employment when he/she is entitled to
exercise an option, then such option may be exercised in full or in part as to
shares which the Participant was entitled to purchase at the date of his/her
termination of employment as set forth in the Plan. In no event, however, may
such an option be exercised after the expiration of ten (10) years from the
date such option was granted nor, in the case of incentive stock options,
after the last day specified in Section 422 of the Code.
FEDERAL TAX TREATMENT OF INCENTIVE STOCK OPTIONS
An optionee will not realize taxable income when an incentive stock option
is granted under the Plan or when an incentive stock option is exercised, and
the Corporation will not be entitled to a deduction with respect to the
option. If the optionee of an incentive stock option holds the shares acquired
under the option for at least two years from the date the option is granted
and for at least one year from the date the option is exercised, any gain
realized by the optionee when the shares are sold will be taxable to the
optionee as capital gain. If the optionee does not hold the shares for the
one-year and the two-year periods, the optionee will realize ordinary income
in the year of disposition of the shares in an amount equal to the excess of
the fair market value of the shares on the date of exercise (or the proceeds
or the disposition, if lower) over the option price, and the corporation will
be entitled to a corresponding deduction. Any remaining gain will generally be
capital gain. If the shares are disposed of at a loss, the loss will be a
capital loss. The difference between the exercise price of an incentive stock
option and the fair market value of the shares subject to the option at the
time of exercise is an item of tax preference which may result in the optionee
being subject to the alternative minimum tax. Whether an optionee is subject
to the alternative minimum tax in lieu of "regular" income tax will depend on
individual facts and circumstances.
PAYMENT OF WITHHOLDING TAXES
The Corporation may withhold, or require a participant to remit to the
Corporation, an amount sufficient to satisfy any federal, state and local
withholding tax requirements. The Compensation Committee may permit a
participant to satisfy a tax withholding requirement on exercise of an option
by delivery to the Corporation of shares of its Common Stock owned by the
participant, including shares the participant is entitled to receive upon
exercise of the option or vesting of the award.
OPTION PRICE
The option price per share of Common Stock under each incentive stock option
shall be determined by the Compensation Committee and shall not be less than
the fair market value at the time the option is granted. The
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option price per share of Common Stock under each non-qualified stock option
shall be determined by the Compensation Committee. In the case of an option
intended to qualify as an incentive stock option, the aggregate fair market
value (determined at the time the option is granted) of the Common Stock with
respect to which incentive stock options are exercisable for the first time by
the Participant during any calendar year under all such plans of the
Corporation and its subsidiaries shall not exceed $100,000.
EXERCISE OF OPTIONS
Each option shall be exercisable in whole or in part at such times as the
Compensation Committee may determine, but not later than ten (10) years from
the date the option is granted. The Compensation Committee may make such
exercise provisions, or may accelerate exercise provisions previously
established, if in the opinion of the Compensation Committee such action is
appropriate to carry out the intent of the Plan or any requirement of the
Code. In lieu of a cash payment to exercise an option in full or in part,
payment may be made by the tender of shares of Common Stock with a fair market
value as of the exercise date equal to the option price of the option being
exercised.
ADJUSTMENT UPON CHANGES IN STOCK
In the event of a stock dividend, stock split or other change in corporate
structure or capitalization affecting the Common Stock which becomes effective
after the adoption of the Plan by the Board of Directors, the Compensation
Committee may, in its discretion, make appropriate adjustments in (i) the
number and kind of shares of stock on which options may thereafter be granted
hereunder; (ii) the number and kind of shares of stock remaining subject to
each option outstanding at the time of such change, and (iii) the option
price.
CHANGE IN CONTROL
In the event of a Change in Control, as defined in the Plan, all options
shall become exercisable in full.
AMENDMENT AND TERMINATION
The Board of Directors may at any time or times amend the Plan for the
purpose of satisfying the requirements of any changes in applicable laws or
regulations or for any other purpose which may at the time be permitted by law
or may at any time terminate the Plan as to any further grants of options,
provided that no amendment shall be made without the approval of the
shareholders of the Corporation if such approval would be required in order
for the Plan to continue to comply with Section 16(b) of the Securities
Exchange Act of 1934.
FEDERAL TAX TREATMENT OF NONQUALIFIED STOCK OPTIONS
An optionee will not realize taxable income, and the Company will not be
entitled to a deduction, at the time that a nonqualified stock option is
granted under the Plan. Upon exercising a nonqualified stock option, an
optionee will realize ordinary income, and the Corporation will be entitled to
a corresponding deduction, in an amount equal to the excess of the fair market
value on the exercise date of the shares subject to the option over the
exercise price of the option. The optionee will have a basis, for purposes of
computing capital gain or loss on a future sale or exchange, in the shares
received as a result of the exercise equal to the fair market value of those
shares on the exercise date.
EFFECTIVE DATE AND DURATION OF THE PLAN
The Plan shall be effective immediately following approval by the
Corporation's shareholders and, if approved by the Corporation's shareholders,
shall be considered to be dated April 21, 1998. The Plan shall continue in
effect until it is terminated by action of the Board or the Corporation's
shareholders, but such termination shall not affect the terms of any then
outstanding Options.
----------------
Approval of the Plan requires the affirmative vote of the holders of at
least a majority of the shares of Common Stock present in person or by proxy
at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE PLAN.
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PROPOSAL 5
RATIFICATION OF APPOINTMENT OF
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
(ITEM 5 ON THE PROXY CARD)
The firm of Coopers & Lybrand L.L.P. has been appointed by the Board of
Directors to serve as the Corporation's independent certified public
accountants for the fiscal year beginning January 1, 1998. The Board of
Directors of the Corporation is requesting shareholder approval of the
appointment. A partner in the firm will be present at the meeting to answer
questions and will have the opportunity to make a statement, if he so desires.
The firm is presently serving the Corporation and the Bank, as their
independent certified public accountants. Management recommends approval of
this appointment. If the appointment is not approved by a majority of the
shares of Common Stock of the Corporation present in person or by proxy and
entitled to vote at the Annual Meeting, the appointment of the independent
certified public accountants will be reconsidered by the Board of Directors.
The resolution being voted on is as follows:
RESOLVED, that the shareholders of the Corporation ratify and confirm the
appointment of Coopers & Lybrand L.L.P. as the Corporation's independent
certified public accountants for the year 1998.
----------------
The ratification of the selection of the independent certified public
accountants requires the affirmation by vote of at least a majority of the
outstanding shares of Common Stock of the Corporation present in person or by
proxy and entitled to vote at the Annual Meeting. Proxies solicited by the
Board of Directors will be voted for the foregoing resolution, unless
shareholders specify a contrary choice in their proxies.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RESOLUTION RATIFYING THE
APPOINTMENT OF COOPERS & LYBRAND L.L.P. AS THE CORPORATION'S INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS FOR THE YEAR 1998.
OTHER BUSINESS
Management does not know at this time of any other matter which will be
presented for action at the Annual Meeting. If any unanticipated business is
properly brought before the meeting, the proxies will vote in accordance with
their best judgment.
SHAREHOLDER PROPOSALS FOR 1999
The Corporation's Annual Meeting of Shareholders will be held on or about
April 20, 1999. Any shareholder desiring to submit a proposal to the
Corporation for inclusion in the proxy and proxy statement relating to that
meeting must submit such proposal or proposals in writing to the Corporation
before November 19, 1998.
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ADDITIONAL INFORMATION
A copy of the Corporation's Annual Report for the fiscal year ended December
31, 1997, containing, among other things, financial statements examined by its
independent certified public accountants was mailed with this Proxy Statement
on or about March 6, 1998 to the shareholders of record as of the close of
business on March 2, 1998.
Upon written request of any shareholder, a copy of the Corporation's Annual
Report on Form 10-K for its fiscal year ended December 31, 1997, including the
financial statements and schedules thereto, required to be filed with the
Securities and Exchange Commission may be obtained, without charge, from the
Corporation's Secretary, Samuel C. Wasson, Jr., 801 Lancaster Avenue, Bryn
Mawr, Pennsylvania 19010-3396.
By Order of the Board of Directors of
Bryn Mawr Bank Corporation
/s/ Samuel C. Wasson
Samuel C. Wasson, Jr.
Secretary
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EXHIBIT A
PROPOSED AMENDMENT
TO THE BY-LAWS OF THE CORPORATION
INCREASING THE MAXIMUM NUMBER OF DIRECTORS
FROM TWELVE (12) TO FOURTEEN (14) DIRECTORS
SECTION 3.01 OF ARTICLE III OF THE CORPORATION'S BY-LAWS WILL BE AMENDED TO
READ IN ITS ENTIRETY AS FOLLOWS:
"Section 3.01. NUMBER AND ELECTION. The business of the Corporation shall be
managed by a Board of Directors of not less than eight nor more than fourteen
persons, as fixed from time to time by the Board of Directors of the
Corporation. Directors shall be elected by a majority vote of the shares
represented by the holders thereof present either in person or by proxy at the
meeting at which the election takes place. The Directors of the Corporation
shall be divided into four classes: Class I, Class II, Class III and Class IV.
Each class shall be as nearly equal in number as possible. Except for the
initial Board of Directors, the term of office of each class shall be four
years; provided, however, that the term of office of the additional Class III
Director shall expire at the annual meeting of shareholders of the Corporation
in 2001. At each annual meeting of shareholders of the Corporation held during
and after 1998, the directors chosen to succeed those whose terms then expire
shall be identified as being of the same class the directors they succeed. A
director must be a shareholder of the Corporation. If a vacancy occurs on the
Board of Directors of the Corporation after the first annual election of a
director for the classes in which such director sits, a majority of the
remaining directors shall have the exclusive power to fill the vacancy by
electing a director to hold office until the next annual meeting of
shareholders."
SECTION 3.01 OF ARTICLE III OF THE CORPORATION'S BY-LAWS CURRENTLY READS AS
FOLLOWS:
"Section 3.01. NUMBER AND ELECTION. The business of the corporation shall be
managed by a Board of Directors of not less than eight nor more than twelve
persons, as fixed from time to time by the Board of Directors of the
Corporation. Directors shall be elected by a majority vote of the shares
represented by the holders thereof present either in person or by proxy at the
meeting at which the election takes place. The Directors of the Corporation
shall be divided into four classes: Class I, Class II, Class III and Class IV.
Each class shall be as nearly equal in number as possible. Except for the
initial Board of Directors, the term of office of each class shall be four
years; provided, however, that the term of office of the initial Class I
Directors shall expire at the annual meeting of shareholders of the
Corporation in 1987; the term of office of the initial Class II Directors
shall expire at the annual meeting of shareholders of the Corporation in 1988;
the term of office of the initial Class III Directors shall expire at the
annual meeting of shareholders of the Corporation in 1989; the term of office
of the initial Class IV Directors shall expire at the annual meeting of
shareholders of the Corporation in 1990; so that, after the expiration of each
such initial term, the terms of office of one class of directors shall expire
each year when their respective successors have been duly elected by the
shareholders and qualified. At each annual meeting of shareholders of the
Corporation held during and after 1987, the directors chosen to succeed those
whose terms then expire shall be identified as being of the same class the
directors they succeed. A director must be a shareholder of the Corporation.
If a vacancy occurs on the Board of Directors of the Corporation after the
first annual election of directors for the class in which such director sits,
a majority of the remaining directors shall have the exclusive power to fill
the vacancy by electing a director to hold office until the next annual
meeting of shareholders."
A-1
<PAGE>
EXHIBIT B
BRYN MAWR BANK CORPORATION
1998 STOCK OPTION PLAN
1. PURPOSES
The purposes of the Bryn Mawr Bank Corporation 1998 Stock Option Plan are:
. To provide special earnings opportunities to Employees and Eligible
Directors of the Corporation and its Subsidiaries by enabling them to
share in positive changes in the value of the Common Stock of the
Corporation; and
. To enable the Corporation and its Subsidiaries to attract and to keep in
its employment Employees and Eligible Directors who can and do
contribute significantly to the Corporation's long term business
interests.
In order to accomplish these purposes, the Plan authorizes the granting to
such Employees and Eligible Directors Options to purchase Common Stock as
described herein.
2. DEFINITIONS
Whenever used herein, unless the context indicates otherwise, words in the
masculine form shall be deemed to refer to females as well as males. The
captions of the numbered sections and subsections contained in the Plan are
for convenience only and shall not limit or affect the meaning, interpretation
or construction of any of the provisions of the Plan. For purposes of the
Plan, the following terms shall have the meanings indicated:
2.1 "Agreement" means the Stock Option Agreement required to be executed and
delivered by each Employee and Eligible Director and the Corporation pursuant
to subsection 7.1 hereof.
2.2 "Board of Directors" means the Board of Directors of the Corporation.
2.3 "Cause" is defined as personal dishonesty, willful misconduct, any
breach of fiduciary duty involving personal profit, intentional failure to
perform stated duties, or the willful violation of any law, rule or regulation
(other than traffic violations or similar offenses) that results in a material
loss to the Corporation or any Subsidiary, or violation of a judicial order.
2.4 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
2.5 "Committee" means the Compensation Committee of the Board of Directors
or, if none has been appointed, all members of the Board of Directors who are
not then employed by the Corporation or any Subsidiary.
2.6 "Common Stock" means the Corporation's Common Stock $1.00 par value.
2.7 "Corporation" means Bryn Mawr Bank Corporation.
2.8 "Director" means and shall include a Director of the Corporation.
2.9 "Disability" means, as applied to an optionee, total and permanent
disability as defined in the Code.
2.10 "Eligible Director" means a Director of the Corporation who is not
otherwise an employee of the Corporation.
2.11 "Employee" means a key employee (including officers) of the Corporation
or a Subsidiary.
B-1
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2.12 "Exchange Act" means the Securities Exchange Act of 1934, as amended.
2.13 "Fair Market Value" means the last sale price for a share of the
Corporation's common stock as reported by the National Association of
Securities Dealers Automated Quotation System/National Market System on the
day preceding the grant of the Option, or if no sales are reported for that
day, for the last preceding day on which a sale was reported.
2.14 "Guidelines" means the general guidelines for interpreting and
administering the Plan as adopted from time to time by the Committee.
2.15 "Incentive Stock Option" means a stock option granted under the Plan
which satisfies the requirements of Section 422 of the Code or such successor
provision a may be in effect from time to time.
2.16 "Non-Qualified Stock Option" means a stock option granted under the
Plan which is not an Incentive Stock Option intended to satisfy the
requirements of Section 422 of the Code or such successor provision as may be
in effect from time to time.
2.17 "Participant" means an Employee or Eligible Director who has been
granted Options under the Plan.
2.18 "Option(s)" means either an Incentive Stock Option or a Non-Qualified
Stock Option granted under the Plan.
2.19 "Option Period" means the term specified in the Option.
2.20 "Plan" means the Bryn Mawr Bank Corporation 1998 Stock Option Plan.
2.21 "QDRO" means a qualified domestic relations order as defined in the
Code or Title I of the Employment Retirement Income Security Act or the rules
promulgated thereunder.
2.22 "Retirement" means the retirement of an Eligible Director or of an
Employee from the employ of the Corporation or any Subsidiary on normal,
early, postponed or disability retirement, as provided for at the time of such
retirement under the applicable retirement program then maintained by the
Corporation or Subsidiary, as the case may be.
2.23 "Section 16" means Section 16 of the Exchange Act.
2.24 "Shares" mean the Corporation's common stock $1.00 par value.
2.25 "Subsidiary" or "Subsidiaries" means a corporation or corporations in
which the Corporation owns, directly or indirectly, stock sufficient to
qualify as a subsidiary under Section 424 of the Code.
3. SHARES SUBJECT TO THE PLAN
Subject to adjustment as provided in Section 8, the total Shares for which
Options may be granted under the Plan is an amount equal to five percent (5%)
at the outstanding shares of Common Stock of the Corporation on March 2, 1998
(a maximum of Shares). The Shares shall be currently authorized but
unissued or currently held or subsequently acquired by the Corporation as
treasury shares, including Shares purchased in the open market or in private
transactions. If any option granted under the Plan expires or terminates for
any reason without having been exercised in full the Shares, subject to but
not delivered under such option, are available for the grant of other options
under the Plan. No Shares delivered to the Corporation in full or partial
payment of an option purchase price payable pursuant to subsection 7.7 shall
become available for the grant of other options under the Plan.
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<PAGE>
4. ADMINISTRATION OF THE PLAN
4.1 The Plan shall be administered by the Committee. Subject to the terms of
the Plan, the Committee shall have the power to construe the provisions of the
Plan, to determine all questions arising thereunder, and to adopt and amend
Guidelines for administering the Plan as the Committee deems desirable.
4.2 Subject to such approvals and other authority as the Board of Directors
may reserve to itself from time to time, the Committee shall, consistent with
the provisions of the Plan, be authorized to (i) select persons to participate
in the Plan, (ii) determine the form and substance of Option grants made under
the Plan to each participant, and the conditions and restrictions, if any,
subject to which such grants will be made, (iii) interpret the Plan and (iv)
adopt, amend, or rescind such rules and regulations for carrying out the Plan
as it may deem appropriate. Decisions of the Committee (or, where approval or
other authority has been reserved, the Board of Directors) on all matters
relating to the Plan shall be in the Committee's (or, where approval or other
authority has been reserved, the Board of Directors') sole discretion and
shall be conclusive and binding on all parties, including the Corporation, its
shareholders, and the participants in the Plan. The Board of Directors has
reserved the power to review the Committee's determination of performance
goals and cycles. The validity, construction and effect of the Plan and any
rules and regulations relating to the Plan shall be determined in accordance
with applicable federal and state laws and rules and regulations promulgated
pursuant thereto.
5. PARTICIPATION IN THE PLAN
Each Employee and Eligible Director shall be eligible to participate in the
Plan.
6. STOCK OPTIONS
Options granted under the Plan may be an Incentive Stock Option or a Non-
Qualified Stock Option not intended to qualify under Section 422 of the Code
and each Option shall be designated either an Incentive Stock Option or a Non-
Qualified Stock Option at the time it is issued.
7. OPTION TERMS
Each Option granted to an Employee or Eligible Director under the Plan and
the issuance of Shares thereunder shall be subject to the following terms:
7.1 Option Agreements
Each Option granted under the Plan shall be evidenced by an Agreement duly
executed and delivered on behalf of the Corporation and by the Employee or
Eligible Director to whom such option is granted and dated as of the
applicable date of grant of such option. Each Agreement shall comply with and
be subject to the terms and conditions of the Plan. An Agreement may contain
such other terms, provisions and conditions not inconsistent with the Plan as
may be determined by the Committee.
7.2 Options To Be Granted and Grant Dates
(a) An Employee or Eligible Director eligible to receive Options under
the Plan shall be those Employees and Eligible Directors of the Corporation
or any Subsidiary who are in a position to affect significantly the long
term business interests of the Corporation and who have been so designated
by the Committee.
(b) Grants of Options may be made at any time fixed by the Committee to
Employees or Eligible Directors.
7.3 Option Exercise Price
The Option exercise price per share for an option awarded under the Plan
shall be 100% of the Fair Market Value of the underlying Shares on the day
preceding the day the option is granted as provided in subsection 7.2.
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<PAGE>
7.4 Term of Options
Each Option shall expire ten (10) years from its date of grant, but shall be
subject to earlier termination as follows:
(a) In the event an optionee shall cease to be an Employee or serve as a
Director for reasons other than Retirement or Disability, each then vested
option may only be exercised within ninety (90) days after such optionee
shall cease to be an Employee or serve as a Director or within the option
period, whichever is earlier.
(b) In the event of the termination of an optionee's employment or
service as a Director by reason of Retirement or Disability, the then
outstanding options of such optionee shall thereupon vest and become
exercisable within the remaining Option Period.
(c) In the event of the death of an optionee while the optionee is an
Employee or Director, the then outstanding Options of such optionee shall
thereupon vest and become exercisable, and each such Option shall expire
one (1) year after the date of death of such optionee or on the stated
grant expiration date, whichever is earlier. Exercise of a deceased
optionee's Options that are still exercisable shall be by the estate of
such optionee or by a person or persons whom the optionee has designated in
a writing filed with the Corporation, or, if no such designation has been
made, by the person or persons to whom the optionee's rights have passed by
will or the laws of descent and distribution.
(d) In the event of termination for Cause of an optionee's service as an
Employee or Director, such person's unexercised options to purchase Shares
shall be null and void immediately upon termination of the person's service
and may not be exercised.
7.5 Vesting; Exercisability
Each Option shall, upon issuance, become exercisable as provided by the
terms of the Agreement, subject to forfeiture as provided in subsection 7.4(d)
hereof, by each optionee whose employment or service is terminated for Cause.
7.6 Time and Manner of Option Exercise
Any vested and exercisable Option is exercisable in whole or in part at any
time, or from time to time, during the Option period by giving written notice
to the Corporation, signed by the person exercising the Option addressed to
the Treasurer of the Corporation, stating the number of Shares with respect to
which the Option is being exercised, accompanied by payment in full of the
Option exercise price for the number of Shares to be purchased. The earliest
date that both such notice and payment are received by the Treasurer of the
Corporation shall be the date of exercise of the stock option as to such
number of Shares. No Option may at any time be exercised with respect to a
fractional share.
7.7 Payment of Exercise Price
Payment of the Option exercise price may be in cash or by bank certified,
cashier's, or personal check or payment may be in whole or in part by transfer
to the Corporation of Shares of the common stock having a Fair Market Value
equal to the Option exercise price at the time of such exercise. If, in the
latter case, the Fair Market Value of the number of whole Shares is less than
the total exercise price of the Options, the shortfall must be made up in
cash, bank certified, cashier's check, or personal check.
7.8 Transferability
The right of any optionee to exercise an Option granted under the Plan
shall, during the lifetime of such optionee, be exercisable only by such
optionee or, if then permitted by Rule 16b-3 promulgated under Section 16 or
pursuant to a QDRO and shall not otherwise be assignable or transferable by
such optionee other than by will or the laws of descent and distribution and,
if then permitted by Section 16 or a QDRO.
B-4
<PAGE>
7.9 Limitation of Rights
7.9.1 Limitation as to Shares. Neither an optionee nor an optionee's
successor or successors in interest shall have any rights as a shareholder
of the Corporation with respect to any Shares subject to an Option granted
to such person until the proper exercise of the Option.
7.9.2 Limitation as to Employment or Directorship. Neither the Plan, nor
the granting of an Option, nor any other action taken pursuant to the Plan
shall constitute or be evidence of any agreement or understanding, express
or implied, that an Employee or Eligible Director has a right to continue
as an Employee or a Director, as the case may be, for any period of time or
at any particular rate of compensation.
7.10 Effect of Change in Control
In the event of a Change in Control, as hereinafter defined, all Options
which may be granted to an Employee or Eligible Director under the Plan shall
vest immediately and be exercisable. A "Change in Control" shall be deemed to
have occurred if (i) any "person", within the meaning of Section 14(d) of the
Exchange Act, other than the Corporation, or any employee benefit plan(s)
sponsored by the Corporation, is or becomes the "beneficial owner" (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly of fifty percent
(50%) or more of the Common Stock, or (ii) the Corporation consolidates or
merges with any person and shall not be the continuing or surviving
corporation of such consolidation or merger and immediately after such
consolidation or merger the shareholders of the Corporation immediately before
such consolidation or merger own less than fifty percent (50%) of the voting
power of the continuing or surviving corporation.
7.11 Regulatory Approval and Compliance
7.11.1 The Corporation shall not be required to issue any certificate or
certificates for Shares upon the exercise of an Option granted under the
Plan or to record as a holder of record of Shares the name of the
individual exercising an Option under the Plan, without obtaining to the
complete satisfaction of the Committee, the approval of all regulatory
bodies deemed necessary by the Committee and without complying, to the
Committee's complete satisfaction, with all rules and regulations under
federal, state, or local law or Guidelines deemed applicable by the
Committee.
7.11.2 Any reference contained in the Plan to a particular section or
provision of law, rule or regulation including, but not limited to the Code
and the Exchange Act, both as amended, shall include any subsequently
enacted or promulgated section or provision of law, rule or regulation, as
the case may be, of similar import. With respect to persons subject to
Section 16, as amended, transactions under the Plan are intended to comply
with all applicable conditions of Rule 16b-3 or any successor rule that may
be promulgated by the Securities and Exchange Commission. To the extent any
provision of the Plan fails to so comply, it shall be deemed null and void,
to the extent permitted by applicable law and subject to the provisions of
Section 12 below.
7.12 Withholding of Taxes
The Corporation may require, as a condition to any grant of Options under
the Plan or to the delivery of certificates for Shares issued hereunder, that
the grantee pay to the Corporation, in cash, any federal, state or local taxes
of any kind required by law to be withheld with respect to any grant or any
delivery of Shares pursuant to the Plan. The Corporation, to the extent
permitted or required by law, shall have the right to deduct from any payment
of any kind (including, without limitation, any Employee's salary, bonus or
other compensation, Board of Director's retainer fees and committee or meeting
fees) otherwise due to a grantee any federal, state or local taxes of any kind
required by law to be withheld with respect to any grant or to the delivery of
Shares under the Plan, or to retain or sell, without notice, a sufficient
number of the Shares to be issued to such grantee to cover any such taxes,
provided that the Corporation shall not sell any such Shares if such sale
would be considered a sale by such grantee for purposes of Section 16.
B-5
<PAGE>
8. ADJUSTMENT UPON CHANGES IN STOCK
The number and class of Shares subject to each outstanding Option, and the
exercise price per share specified in each such Option shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of common stock resulting from a stock split or consolidation of Shares
or any like capital adjustment or the payment of any stock dividend, or other
increase or decrease in the number of such Shares effected without receipt of
consideration by the Corporation.
9. EXPENSES OF THE PLAN
All costs and expenses of the adoption and administration of the Plan shall
be borne by the Corporation, and none of such expenses shall be charged to any
optionee.
10. EFFECTIVE DATE AND DURATION OF THE PLAN
The Plan shall be effective immediately following approval by the
Corporation's shareholders and, if approved by the Corporation's shareholders,
shall be considered to be dated April 21, 1998. The Plan shall continue in
effect until it is terminated by action of the Board or the Corporation's
shareholders, but such termination shall not affect the terms of any then
outstanding Options.
11. CHOICE OF LAW
The validity, interpretation and administration of the Plan and of any
rules, regulations, determinations or decisions made thereunder, and the
rights of any and all persons having or claiming to have any interest therein
or thereunder, shall be determined exclusively in accordance with the laws of
the Commonwealth of Pennsylvania.
12. AMENDMENT AND TERMINATION OF PLAN AND MISCELLANEOUS MATTERS
12.1 The Board of Directors, without further approval by the Corporation's
shareholders, may amend, terminate or suspend the Plan at any time, in its
sole and absolute discretion; provided, however, that if required to qualify
the Plan under Rule 16b-3 promulgated under Section 16, no amendment shall be
made more than once every six months that would change the amount, price or
timing of Options granted under the Plan, other than to comport with changes
in the Code, or the rules and regulations promulgated thereunder; provided,
further, that if required to qualify the Plan under Rule 16b-3 issued pursuant
to the Exchange Act, no amendment that would do any of the following shall be
made without the approval of the Corporation's shareholders:
(a) Materially increase the number of Shares that may be issued under the
Plan;
(b) Materially modify the requirements as to eligibility for
participation in the Plan; or
(c) Otherwise materially increase the benefits accruing to participants
under the Plan.
Subject to the foregoing requirements, the Board of Directors is authorized
to make amendments to the Plan, as well as modifications to the Plan that may
be dictated by requirements of federal or state laws applicable to the
Corporation or that may be authorized or made desirable by such laws.
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[LOGO OF BRYN MAWR BANK APPEARS HERE]
Bryn Mawr Bank Corporation
Bryn Mawr, Pennsylvania
ANNUAL SHAREHOLDERS MEETING APRIL 21, 1998
Proxy is Solicited on Behalf of the Board of Directors of Bryn Mawr Bank
Corporation
The undersigned shareholder of Bryn Mawr Bank Corporation (the
"Corporation") hereby appoints Thomas M. Petro. Joseph W. Rebl and Robert J.
Ricciardi as Proxies, each with the power to appoint his substitute, and hereby
authorized each of them to represent, and to vote all the shares of stock of the
Corporation held of record by the undersigned on March 2, 1998, at the
Corporation's Annual Meeting of Shareholders to be held at 2:00 P.M. on April
21, 1998, in the Centennial Wing of The Bryn Mawr Trust Company, Lancaster
Avenue and Morton Road, Bryn Mawr, Pennsylvania, and at any adjournment or
postponement thereof.
In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment or
postponement thereof.
PLEASE PROMPTLY MARK, DATE AND RETURN THIS PROXY CARD
USING THE ENCLOSED POSTAGE PAID ADDRESSED ENVELOPE.
(OVER)
FOLD AND DETACH HERE
A special invitation to all shareholders.....
Think about us as more than an investment. We, if we're not, want to be
your bank!
Let us help you with:
. deposit banking
. investment management
. loans -- personal, mortgage, or business
. planning wealth transfer
. trustee/executor
Call us at (610) 526-2300. "Simply the best service you'll ever find in a
bank."
Sincerely,
/s/Robert L. Stevens
Robert L. Stevens
Chairman
<PAGE>
This proxy, when properly executed, will be voted in accordance with the
directions given by the undersigned shareholder. In the absence of other
directions, this proxy will be voted for Proposals 1 through 5 and upon such
other matters as may properly come before the meeting in accordance with the
best judgment of the Proxies.
1. ELECTION OF DIRECTORS:
To vote for the election of all the nominees listed to the right.
FOR Withheld
Authority
[_] [_]
(i) Class III - Term to Expire in 2001:
(1) John D. Firestone
(ii) Class IV - Term to Expire in 2002:
(1) Darrell J. Bell
(2) Richard B. Cuff
(3) William Harral, III
(4) Nancy Vickers
2. Approve and ratify the amendment of the Corporation's By-Laws increasing the
maximum number of members of the Board of Directors from twelve (12) to
fourteen (14) Directors.
FOR AGAINST ABSTAIN
[_] [_] [_]
3. Approve and ratify the amendment of the Corporation's Articles of
Incorporation increasing the Corporation's authorized shares of capital
stock.
FOR AGAINST ABSTAIN
[_] [_] [_]
4. Approve the Corporation's 1998 Stock Option Plan.
FOR AGAINST ABSTAIN
[_] [_] [_]
5. CONFIRMATION OF AUDITORS
To ratify the appointment of Coopers & Lybrand L.L.P. as the independent
certified public accounts for Bryn Mawr Bank Corporation for the year 1998.
FOR AGAINST ABSTAIN
[_] [_] [_]
Please sign exactly as name appears. When shares are held by joint tenants, both
should sign. When signing as attorney in-fact, executor, administrator, trustee
of guardian, please give full title as such. If a corporation, please sign full
corporate name by President or other authorized officer. If a partnership,
please sign partnership name by an authorized person.
Signature(s)__________________Signature(s)________________Date___________,1998
FOLD AND DETACH HERE
