<PAGE> 1
================================================================================
SCHEDULE 14A
(RULE 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] CONFIDENTIAL, FOR USE OF THE COMMISSION
ONLY (AS PERMITTED BY RULE 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
MAHONING NATIONAL BANCORP, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
XXXXXXXXXXXXXXXX
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies: .......
(2) Aggregate number of securities to which transaction applies: ..........
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined): ............
(4) Proposed maximum aggregate value of transaction: ......................
(5) Total fee paid: .......................................................
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid: ...............................................
(2) Form, Schedule or Registration Statement No.: .........................
(3) Filing Party: .........................................................
(4) Date Filed: ...........................................................
================================================================================
<PAGE> 2
================================================================================
MAHONING NATIONAL BANCORP, INC.
NOTICE OF ANNUAL MEETING
AND
PROXY STATEMENT
ANNUAL SHAREHOLDERS MEETING
MARCH 17, 1998
================================================================================
<PAGE> 3
MAHONING NATIONAL BANCORP, INC.
23 Federal Plaza
P.O. Box 479
Youngstown, OH 44501
NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD
March 17, 1998
TO THE HOLDERS OF SHARES OF COMMON STOCK:
Notice is hereby given that the Annual Meeting of the Shareholders of
Mahoning National Bancorp, Inc. (the "Corporation") will be held at The Mahoning
National Bank, 23 Federal Plaza, Youngstown, Ohio 44501 on Tuesday, March 17,
1998, at 11:00 a.m. (local time), for the purpose of considering and voting upon
the following matters:
1. The election of three (3) Directors to be elected to Class I of the
Corporation's staggered Board of Directors to serve a two-year term or
until their successors shall have been elected and qualified.
2. TO TRANSACT SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING
OR ANY ADJOURNMENT THEREOF. THE BOARD OF DIRECTORS AT PRESENT KNOWS OF
NO OTHER BUSINESS TO BE PRESENTED BY OR ON BEHALF OF THE CORPORATION.
Shareholders of record at the close of business on January 30, 1998 are
the only shareholders entitled to notice of and to vote at the Annual
Shareholders Meeting.
By order of the Board of Directors
Gregory L. Ridler, Chairman of the Board,
President and Chief Executive Officer
February 13, 1998
IMPORTANT
WHETHER YOU EXPECT TO ATTEND THE MEETING OR NOT, PLEASE MARK, SIGN,
DATE, AND RETURN THE ACCOMPANYING PROXY CARD IN THE ENCLOSED SELF-ADDRESSED
ENVELOPE AS PROMPTLY AS POSSIBLE. NO POSTAGE IS REQUIRED.
<PAGE> 4
MAHONING NATIONAL BANCORP, INC.
YOUNGSTOWN, OHIO
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of Mahoning National Bancorp, Inc. (the "Corporation")
of proxies to be voted at the Annual Meeting of shareholders to be held on
Tuesday, March 17, 1998, in accordance with the foregoing notice.
The Corporation is a one-bank holding company of which The Mahoning
National Bank of Youngstown (hereinafter "Mahoning National Bank") is a wholly
owned subsidiary.
The solicitation of proxies on the enclosed form is made on behalf of
the Board of Directors of the Corporation. All cost associated with the
solicitation will be borne by the Corporation. The Corporation does not intend
to solicit proxies other than by use of the mails, but certain officers and
regular employees of the Corporation or its subsidiaries, without additional
compensation, may use their personal efforts, by telephone or otherwise, to
obtain proxies. The proxy materials are first being mailed to shareholders on
February 13, 1998.
Any shareholder executing a proxy has the right to revoke it by the
execution of a subsequently dated proxy, by written notice delivered to the
Secretary of the Corporation prior to the exercise of the proxy or in person by
voting at the meeting. The shares will be voted in accordance with the direction
of the shareholder as specified on the proxy. In the absence of instructions,
the proxy will be voted "FOR" the election of the three (3) persons listed in
this Proxy Statement.
VOTING SECURITIES
Only shareholders of record at the close of business on January 30,
1998, will be eligible to vote at the Annual Meeting or any adjournment thereof.
As of January 30, 1998, the Corporation had outstanding 6,300,000 shares of
Common Stock, no par value. Shareholders are entitled to one (1) vote for each
share of common stock owned as of the record date, and shall have the right to
cumulate votes in the election of directors, in accordance with Ohio law.
Cumulative voting permits a shareholder to multiply the number of shares held by
the number of directors to be elected, and cast those votes for one candidate or
spread those votes among several candidates as he or she deems appropriate.
As of January 30, 1998, Mahoning National Bank held 892,859 shares of
the Corporation's outstanding shares in their Trust Department in regular or
nominee accounts. This total represents 14.17 percent of the outstanding shares,
which will be voted in accordance with the instructions contained in the various
trust agreements pursuant to which such shares are held and may, therefore, in
certain circumstances in which discretionary voting is granted to the trustee,
be voted at the direction of The Mahoning National Bank as Trustee.
<PAGE> 5
All directors and Named Executive Officers as a group (comprised of
nine individuals), beneficially held 138,880 shares of the Corporation's common
stock as of January 30, 1998, representing 2.204 percent of the outstanding
common stock of the Corporation.
PROPOSAL #1
ELECTION OF DIRECTORS AND INFORMATION
WITH RESPECT TO DIRECTORS AND OFFICERS
CLASSIFICATION SYSTEM FOR THE ELECTION OF DIRECTORS
The Corporation has a classified system for the election of directors.
Directors are divided into classes as nearly equal in number as possible but
with no fewer than three directors per class. The Corporation has six directors
and, therefore, the directors have been divided into two classes comprised of
three directors. Directors are elected to serve a two-year term.
INFORMATION WITH RESPECT TO NOMINEES
The following information is provided with respect to each nominee for
director and each present continuing director whose term of office extends
beyond the Annual Meeting of the Corporation's Shareholders. Those nominees
receiving the greatest number of votes will be elected as Directors. There is no
minimum number of votes required to elect a Director.
CLASS I
(TERM TO EXPIRE 2000)
<TABLE>
<CAPTION>
Director of
Mahoning Director of
Principal Occupation National Bank Corporation
Name and Age Past 5 Years Since Since
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
William J. Bresnahan President, Hynes 1990 N/A
(47) Industries, Inc.
Frank A. Kramer (66) President, Brenner 1981 1994
Industrial Sales and
Supply
Warren P. Williamson, Chairman, Sygnet 1972 1992
III (67) Wireless, Inc;
Chairman, WKBN
Broadcasting Corp.
</TABLE>
2
<PAGE> 6
The following Directors shall continue to serve as Directors until
their respective terms expire and are not standing for reelection at this Annual
Meeting of Shareholders:
INFORMATION WITH RESPECT TO DIRECTORS NOT STANDING FOR REELECTION
CLASS II
(CONTINUING DIRECTORS WITH TERM TO EXPIRE 1999)
<TABLE>
<CAPTION>
Director of
Mahoning Director of
Principal Occupation National Bank Corporation
Name and Age Past 5 Years Since Since
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Charles J. McCrudden, Jr. President, McCrudden 1986 1995
(62) Heating and Air
Conditioning Supplies
Gregory L. Ridler (51) Chairman of the Board, 1988 1992
President & Chief
Executive Officer,
Mahoning National Bancorp,
Inc. and President & Chief
Executive Officer, of The
Mahoning National Bank of
Youngstown
Daniel B. Roth (68) President, Roth, Blair, 1972 1995
Roberts, Strasfeld & Lodge,
L.P.A., Vice Chairman,
Torent, Inc. and Vice
Chairman, McDonald Steel
Corp.
</TABLE>
The business experience of each of the above-listed nominees and
directors during the past five years was that typical to a person engaged in the
principal occupation listed. Unless otherwise indicated, each of the nominees
and directors has had the same position or another executive position with the
same employer during the past five years.
Shareholders desiring to nominate individuals to serve as directors may
do so by following the procedure outlined in the Corporation's Code of
Regulations requiring advance notice to the Corporation of such nomination and
certain information regarding the proposed nominee.
3
<PAGE> 7
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information regarding beneficial
ownership as of January 30, 1998, of the Corporation's common shares of each
director, each Named Executive Officer and all directors and Named Executive
Officers as a group.
<TABLE>
<CAPTION>
Aggregate Number of Shares Percent of Outstanding
Name Beneficially Owned* Shares
---- ------------------- ------
<S> <C> <C>
William J. Bresnahan 881 .014
Frank Hierro 2,289 .036
Frank A. Kramer 39,011 .619
Charles J. McCrudden, Jr. 9,974 .158
Parker T. McHenry 1,437 .023
Gregory L.Ridler 24,400 .387
Daniel B. Roth 10,974 .174
David E. Westerburg 1,219 .019
Warren P. Williamson, III 48,695 .773
All Directors and Named Executive
Officers as a Group (includes nine
persons) 138,880 2.204
<FN>
*Beneficial Ownership includes those shares over which an individual has sole or
shared voting, or investment power, such as beneficial interests of such
person's spouse, minor children and other relatives living in the home of the
named person, trusts, estates and certain affiliated companies.
</TABLE>
COMMITTEES AND COMPENSATION OF THE BOARD OF DIRECTORS
The Corporation's nominating function is performed by the Board of
Directors acting as a committee of the whole. In conducting its nominating
function, the Board of Directors of the Corporation is responsible for making
annual nominations for directors to fill vacancies created by expired terms of
directors and, from time to time, making appointments to fill vacancies created
prior to the expiration of a director's term. During 1997, the Board met once to
consider and act upon the nomination of directors.
During 1997 the Company established an Examining Committee which
performs the functions of an Audit Committee. The Examining Committee's
functions include its obligation to: (a) annually recommend to the Board of
Directors of the Company, and to the Board of Directors of each of the Company's
subsidiaries, for appointment by the respective boards, independent public
accountants as auditor of the books, records and accounts of the Company and
each such subsidiary; (b) review the scope of audits made by the independent
public accountants; and (c) receive and review the audit reports submitted by
the independent public accountants and take such action in respect of such
reports as the Examining Committee may deem appropriate. During 1997 the
Examining Committee of the Bank performed the functions of the Company's
Examining Committee and met four times.
4
<PAGE> 8
The Mahoning National Bank Executive Committee performs the function of
a Compensation Committee. For a complete description of its functions and
members, see "Report of the Executive Committee of The Mahoning National Bank on
Compensation" in this Proxy Statement.
The Board of Directors of the Corporation meets quarterly for its
regular meetings and upon call for special meetings. During 1997, the Board met
five times consisting of four regular meetings and one special meeting. Each of
the directors of the Corporation attended at least 75 percent of all board
meetings and committee meetings they were scheduled to attend.
Directors of the Corporation, other than those persons who serve as
officers of The Mahoning National Bank, receive for their service a quarterly
retainer of $625 and a fee of $300 for each meeting attended.
[THIS SPACE LEFT INTENTIONALLY BLANK]
5
<PAGE> 9
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table provides certain summary information concerning
compensation paid or accrued by the Corporation and/or its subsidiaries, to or
on behalf of the Corporation's Chief Executive Officer and each of the other
three most highly compensated officers earning $100,000 or more annually, (the
"Named Executive Officers"):
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION All Other
Name and Principal Position Year Salary ($) Bonus ($) Compensation (3)($)
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
GREGORY L. RIDLER, President 1997 225,000 123,726 (1) 307
and Chief Executive Officer 1996 210,000 73,487 (1) 281
The Mahoning National Bank 1995 195,000 68,248 (1) 532
PARKER T. MCHENRY, Executive Vice 1997 120,000 36,000 (2) 0
President, The Mahoning National Bank 1996 114,000 34,200 (2) 0
1995 107,000 32,100 (2) 0
FRANK HIERRO, Senior Vice President 1997 92,958 27,283 (1) 0
Loans, The Mahoning National Bank 1996 82,000 24,168 (1) 0
DAVID E. WESTERBURG, Senior 1997 85,000 25,471 (1) 0
Vice President Operations/Retail Banking,
The Mahoning National Bank
<FN>
(1) Represents awards under the Corporation's Executive Phantom Stock Bonus
Plan and cash bonuses. For 1997 the amounts disclosed included $78,726 for
Mr. Ridler, $18,597 for Mr. Hierro and $16,971 for Mr. Westerburg awarded
under Executive Stock Bonus Plan, (See "Executive Deferred Cash and
Executive Phantom Stock Bonus Plans"), and $45,000, $8,686 and $8,500 in
cash bonuses awarded to Messrs. Ridler, Hierro and Westerburg. All awards
under the Executive Phantom Stock Bonus Plan are subject to vesting except
for acceleration in the event of death, permanent disability or a change of
control of the Corporation. Vested awards are payable upon termination of
employment or retirement.
(2) Represents amount awarded to Mr. McHenry under the terms of the
Corporation's Executive Deferred Cash Bonus Plan adopted November 15, 1993.
The amount awarded annually is determined by return on stockholder equity
performance requirements as set forth in the Deferred Cash Bonus Plan. For
the year 1997, Mr. McHenry received $36,000 (representing 30% of his 1997
base compensation). See "Executive Deferred Cash and Executive Phantom
Stock Bonus Plans". Vested awards are payable upon termination of
employment or retirement.
(3) The amount for Mr. Ridler represents the premium attributable to his
portion of a Split Dollar Life Insurance policy.
</TABLE>
6
<PAGE> 10
PENSION PLANS
The following table shows the estimated annual pension benefits payable
to a covered participant at normal retirement age (age 65) under the
Corporation's qualified defined benefit pension plan, based on remuneration that
is covered under the plans and years of service with the Corporation and its
subsidiaries:
<TABLE>
<CAPTION>
ESTIMATED ANNUAL RETIREMENT BENEFITS
ANNUAL AVERAGE
OF FINAL 60
MONTHS SALARY 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS 40 YEARS
- ------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$60,000 16,583 22,110 27,638 33,166 38,693 44,221
85,000 24,683 32,910 41,138 49,366 57,593 65,821
110,000 32,783 43,710 54,638 65,566 76,493 87,421
135,000 40,883 54,510 68,138 81,766 95,393 109,021
160,000 48,983 65,310 81,638 97,966 114,293 125,000
185,000 48,983 65,310 81,638 97,966 114,293 125,000
</TABLE>
A participant's remuneration covered by the Corporation's pension plan
is his or her average salary (as reported in the Summary Compensation Table) for
the 60 months before normal retirement. Participants are vested in their pension
benefits after five years of service. Mr. McHenry had 8 years of service, Mr.
Ridler had 27 years of service, Mr. Hierro had 12 years of service and Mr.
Westerburg had 4 years of service, respectively, as of December 31, 1997.
Effective on December 11, 1995, the Corporation entered into a
Supplemental Executive Retirement Plan with Mr. Ridler. The purpose of the Plan
is to replace certain retirement benefits which Mr. Ridler lost under the
Corporation's qualified retirement plans due to the eligible compensation
limitations under current tax law. Pursuant to the terms of the Supplemental
Executive Retirement Plan, upon Mr. Ridler's retirement at his Normal Retirement
Age of 65, he will receive payments of $93,000 from the Corporation, annually,
for twenty years. This amount represents an estimate of the value of the lost
benefits resulting from the reduction in eligible compensation under the
Corporation's tax qualified retirement plan. Reduced benefits are provided to
Mr. Ridler under the Supplemental Executive Retirement Plan in the event of
early retirement.
In addition, contemporaneously with the adoption of the Supplemental
Executive Retirement Plan, the Corporation and Mr. Ridler entered into a Split
Dollar Life Insurance Agreement which provides for the payment, to Mr. Ridler's
beneficiaries, of one-third of the net-at-risk insurance portion of an insurance
policy purchased by the Corporation in connection with the establishment of the
Supplemental Executive Retirement Plan. As of December 31, 1997, this Split
Dollar Life Insurance Agreement would have provided a death benefit of $357,007
to Mr. Ridler's beneficiaries. The Corporation purchased life insurance for the
purpose of funding its obligations under the Supplemental Executive Retirement
Plan in the event of Mr. Ridler's death and as an investment vehicle designed to
fund the payments to Mr. Ridler at retirement.
7
<PAGE> 11
REPORT OF THE EXECUTIVE COMMITTEE OF THE MAHONING NATIONAL BANK ON COMPENSATION
Under rules established by the Securities and Exchange Commission (the
"SEC"), the Corporation is required to provide certain data and information in
regard to the compensation and benefits provided to the Corporation's Chairman
of the Board, President and Chief Executive Officer and, if applicable, the four
other most highly compensated executive officers, whose compensation exceeded
$100,000 during the Corporation's fiscal year. The disclosure requirements, as
applied to the Corporation, includes the Corporation's Chairman of the Board,
President and Chief Executive Officer (Mr. Gregory L. Ridler), Executive Vice
President (Mr. Parker T. McHenry), and Senior Vice President, Loans (Mr. Frank
Hierro), and Senior Vice President, Operations/Retail Banking (Mr. David E.
Westerburg) and includes the use of tables and a report explaining the rationale
and considerations that led to fundamental executive compensation decisions
affecting Mr. Ridler, Mr. McHenry, Mr. Hierro, and Mr. Westerburg. The
Corporation is a holding company and owns a single subsidiary, The Mahoning
National Bank. The Corporation has no direct employees. All disclosures
contained in this Proxy Statement regarding executive compensation reflect
compensation paid by The Mahoning National Bank. The Executive Committee of The
Mahoning National Bank (the "Committee") has the responsibility of determining
the compensation policy and practices with respect to all Executive Officers. At
the direction of the Board of Directors, the Committee has prepared the
following report for inclusion in this Proxy Statement.
COMPENSATION PHILOSOPHY. This report reflects the Corporation's
compensation philosophy as endorsed by the Committee. The Committee determines
the level of compensation for all other executive officers within the
constraints of the amounts approved by the Board.
Essentially, the executive compensation program of the Corporation has
been designed to:
- - Support a pay-for-performance policy that awards executive officers for
corporate performance.
- - Motivate key senior officers to achieve strategic business goals.
- - Provide compensation opportunities which are comparable to those
offered by other peer group companies, thus allowing the Corporation to
compete for and retain talented executives who are critical to the
Corporation's long-term success.
SALARIES. Effective January 1, 1998, the Committee increased the salary
paid to Mr. Ridler, Mr. McHenry, Mr. Hierro, and Mr. Westerburg. The increase
reflected consideration of competitive data reported in compensation surveys and
the Committee's assessment of the performance of such executives over the
intervening year and recognition of the Corporation's performance during 1997.
In addition, the Committee approved compensation increases for all other
executive officers of the Corporation. The Mahoning National Bank Board approved
all of such increases upon recommendation of the Committee. Executive Officer
salary increase determinations are based upon written performance appraisals of
such executives which reviews, among other things, the performance of executives
against goals set in the prior year, extraordinary service and promotions within
the organization.
8
<PAGE> 12
EXECUTIVE DEFERRED CASH AND EXECUTIVE PHANTOM STOCK BONUS PLANS. Mr.
McHenry participates in the Executive Deferred Cash Bonus Plan ("Deferred Cash
Bonus Plan") and Messrs. Ridler, Hierro and Westerburg participate in the
Executive Phantom Stock Bonus Plan ("Phantom Stock Plan"). Pursuant to the terms
of the Deferred Cash Bonus Plan, Mr. McHenry is eligible for a deferred cash
bonus in each year that The Mahoning National Bank's earnings achieve
predetermined corporate earnings levels. Under the terms of the Phantom Stock
Plan, participating executives are eligible for deferred phantom stock bonuses,
according to similar predetermined corporate earnings performance levels. Under
the terms of the plans the participating executives are eligible to receive a
deferred bonus of from 2.5 percent to 35 percent of their compensation. In the
case of the Deferred Cash Bonus Plan, the bonus is credited to the account of
the participating executive and accrues an additional 8 percent per annum in
interest. Under the terms of the Phantom Stock Plan the bonus is credited in the
participant's phantom stock account in Phantom Shares, the value of which is
then determined with reference to the value of the Corporation's common stock,
plus additional credits to the account to reflect dividends paid on the stock.
In connection with both plans, the benefits are payable upon termination of
employment or retirement in a lump sum or over a term at the election of the
participant and are subject to a vesting schedule. The Executive Committee of
The Mahoning National Bank's Board of Directors has complete discretion in the
administration and interpretation of the plans.
THIS REPORT ON COMPENSATION IS SUBMITTED BY THE EXECUTIVE COMMITTEE MEMBERS:
Warren P. Williamson, III, Chairman Charles J. McCrudden, Jr.
William J. Bresnahan Gregory L. Ridler
Frank A. Kramer Daniel B. Roth
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION.
Mr. Ridler, the Corporation's Chairman of the Board, President and
Chief Executive Officer, served on the Executive Committee (the "Committee") of
The Mahoning National Bank, which is responsible for compensation matters (see
"Report of the Executive Committee of The Mahoning National Bank on
Compensation" in this Proxy Statement).
Although Mr. Ridler served on the Committee, he did not participate in
any decisions regarding his own compensation as an Executive Officer. Each year,
the Executive Committee determines the amount of the bonus award for the
Chairman, President and Chief Executive Officer (pursuant to the Executive
Phantom Stock Bonus Plan described elsewhere in this Proxy Statement) and salary
for the ensuing year. Mr. Ridler did not participate in discussions or
decision-making relative to his compensation.
PERFORMANCE GRAPH - Five-Year Shareholder Return Comparison
The SEC requires that the Corporation include in this Proxy Statement a
line-graph presentation comparing cumulative, five-year shareholder returns on
an indexed basis with a broad equity market index and either a nationally
recognized industry standard or an index of peer companies selected by the
Corporation. The Corporation has selected the Dow Jones Equity Market Index and
the Dow Jones Regional Bank Index for purposes of this performance
9
<PAGE> 13
comparison which appears below. The Performance Graph presents a comparison
which assumes $100 invested on December 31, 1992, in the Corporation's common
stock, the Dow Jones Equity Market Index and the Dow Jones Regional Bank Index.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN* AMONG MAHONING
NATIONAL BANCORP, INC., DOW JONES EQUITY MARKET INDEX & DOW JONES MAJOR
REGIONAL BANK INDEX FOR FISCAL YEAR ENDING DECEMBER 31
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
MAHONING NATIONAL BANCORP, INC. $100.00 $127.44 $187.64 $271.61 $332.01 $484.25
DOW JONES EQUITY MARKET INDEX $100.00 $109.95 $110.76 $152.49 $187.63 $251.34
DOW JONES REGIONAL BANK INDEX $100.00 $105.27 $101.31 $162.02 $222.62 $347.78
<FN>
ASSUMES $100 INVESTED ON DECEMBER 31, 1992 IN MAHONING NATIONAL BANCORP, INC.
COMMON STOCK, DOW JONES EQUITY MARKET INDEX & DOW JONES MAJOR REGIONAL BANK
INDEX
*TOTAL RETURN ASSUMES REINVESTMENT OF DIVIDENDS
</TABLE>
CHANGE OF CONTROL AGREEMENT
The Corporation has entered into Change of Control Agreements
(the"Agreements") with Messrs. Ridler, McHenry, Hierro, and Westerburg. The
Agreements provide the executives are entitled to monthly periodic payments in
the event of a termination of employment (other than for cause) following a
Change of Control. A Change of Control is defined to include a merger or other
acquisition of the Corporation or the Mahoning National Bank and certain other
changes in the voting control of the Corporation. In the event of a Change of
Control and termination of the executive, the Agreements provide for the payment
of monthly cash payments equal to the highest monthly base salary of such
executive prior to the Change of Control, for 36 months in the case of Mr.
Ridler and 24 months for each of the other named executive officers. The rights
of the Corporation to choose to employ or terminate the executives prior to a
Change of Control are not affected by the Agreements. In the event a Change of
Control had occurred on January 1, 1998, and each of the executive's employment
had been involuntarily terminated on such date (other than for cause), Mr.
Ridler would have been entitled (subject to certain immaterial modifications
provided for by the Agreements which may lower the amount), to receive a monthly
sum of $18,750 for 36 months; Messrs. McHenry, Hierro and Westerburg would have
been entitled (subject to certain immaterial modifications provided for by the
Agreements which may lower the amount), to receive a monthly sum of $10,000,
$9,166, and $7,083, respectively for 24 months.
10
<PAGE> 14
TRANSACTIONS WITH MANAGEMENT
Directors of The Mahoning National Bank and the Corporation and their
associates were customers of, and have had transactions with, The Mahoning
National Bank in the ordinary course of business during 1997.
These transactions consisted of extensions of credit by The Mahoning
National Bank in the ordinary course of business and were made on substantially
the same terms as those prevailing at the time for comparable transactions with
other persons. In the opinion of the management of The Mahoning National Bank,
those transactions do not involve more than a normal risk of being collectible
or present other unfavorable features. The Mahoning National Bank expects to
have, in the future, banking transactions in the ordinary course of its business
with directors and their associates on the same terms, including interest rates
and collateral on loans, as those prevailing at the time of comparable
transactions with others.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's officers and directors, and persons who own more than 10 percent
of a registered class of the Corporation's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Officers, directors and greater than 10 percent shareholders are required by SEC
regulation to furnish the Corporation with copies of all Section 16(a) forms
they file.
Based solely on review of the copies of such forms furnished to the
Corporation, or written representations that no Form 5s were required, the
Corporation believes that during 1997, all Section 16(a) filing requirements
applicable to its officers, directors, and greater than 10 percent beneficial
owners were complied with.
SELECTION OF AUDITORS
Crowe, Chizek and Company LLP has been appointed to serve as the
Independent Auditor for the Corporation and its subsidiary for the fiscal year
ended December 31, 1997. It is the intention of the Corporation to appoint
Crowe, Chizek and Company LLP as Independent Auditor for 1998. Representatives
of Crowe, Chizek and Company LLP are expected to be present at the Annual
Meeting to respond to appropriate questions from stockholders and to have the
opportunity to make any statements they consider appropriate.
SHAREHOLDER PROPOSALS
Any proposals to be considered for inclusion in the proxy material to
be provided to shareholders of the Corporation for its next annual meeting, to
be held in 1999, must be made by a qualified shareholder and must be received by
the Corporation no later than October 9, 1998.
11
<PAGE> 15
OTHER MATTERS
The Board of Directors of the Corporation is not aware of any other
matters that may come before the meeting. However, the enclosed Proxy will
confer discretionary authority with respect to matters which are not known to
the Board of Directors at the time of printing hereof and which may properly
come before the meeting. A copy of the Corporation's 1997 report filed with the
Securities and Exchange Commission, on Form 10-K, will be available without
charge to shareholders on request April 1, 1998. Address all requests, in
writing, for this document to Richard E. Davies, Mahoning National Bancorp,
Inc., 23 Federal Plaza, Youngstown, Ohio 44501.
By Order of the Board of Directors
Richard E. Davies, Secretary
February 13, 1998
12
<PAGE> 16
<TABLE>
<S> <C>
Please mark
your votes as [X]
indicated in
this example
1. TO ELECT THE FOLLOWING THREE DIRECTORS TO 2. TO TRANSACT SUCH OTHER BUSINESS AS
CLASS I WHOSE TERMS WILL EXPIRE IN 2000. MAY PROPERLY COME BEFORE THE MEETING OR
ANY ADJOURNMENT HEREOF.
FOR WITHHOLD
Three AUTHORITY THIS PROXY CONFERS AUTHORITY TO VOTE
Nominees to vote for "FOR" THE NOMINEES FOR DIRECTOR SET
Three Nominees FORTH IN ITEM #1 ABOVE UNLESS OTHERWISE
[ ] [ ] INDICATED. IF ANY OTHER BUSINESS IS
PRESENTED AT SAID MEETING, THIS PROXY
(INSTRUCTION: To withhold authority to vote for any individual SHALL BE VOTED IN ACCORDANCE WITH THE
director, strike a line through the director's name listed below.) RECOMMENDATIONS OF MANAGEMENT. ALL
SHARES REPRESENTED BY PROPERLY EXECUTED
PROXIES WILL BE VOTED AS DIRECTED. IN
William J. Bresnahan THE ABSENCE OF INSTRUCTIONS, THIS PROXY
Frank A. Kramer WILL BE VOTED "FOR" THE ELECTION OF THE
Warren P. Williamson, III THREE (3) PERSONS LISTED IN ITEM #1.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" THE NOMINEES FOR
DIRECTOR SET FORTH IN ITEM #1
ABOVE. THIS PROXY IS SOLICITED ON
BEHALF OF THE BOARD OF DIRECTORS
AND MAY BE REVOKED PRIOR TO ITS
EXERCISE BY EITHER WRITTEN NOTICE
OR PERSONALLY AT THE MEETING OR
BY A SUBSEQUENTLY DATED PROXY.
NUMBER OF SHARES: ________________
SIGNATURE(S)______________________________________ SIGNATURE(S) _____________________________________ DATE _________________
(WHEN SIGNING AS ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN, PLEASE GIVE FULL TITLE. IF MORE THAN ONE TRUSTEE, ALL
SHOULD SIGN. ALL JOINT OWNERS MUST SIGN. PLEASE SIGN AND RETURN IMMEDIATELY.)
</TABLE>
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
- --------------------------------------------------------------------------------
MAHONING NATIONAL BANCORP, INC.
AUTOMATIC DIVIDEND REINVESTMENT PLAN
Mahoning National Bancorp, Inc. now offers its shareholders an easy way
to reinvest cash dividends in shares of Mahoning National Bancorp, Inc.
Common Stock. Our automatic dividend reinvestment plan is a program
whereby our shareholders have an option to choose to purchase
additional Mahoning National Bancorp, Inc. common shares with their
dividends, instead of receiving them in cash.
HOW IT WORKS:
Shareholders who are enrolled in this program automatically have their
cash dividends promptly invested in common shares purchased in the open
market at the prevailing price of the stock. The full amount of their
cash dividend is reinvested even if fractional shares are required to
be purchased. For further convenience, Mahoning National Bank will hold
plan shares in safekeeping. A detailed statement will be sent to you
after each reinvestment.
ADDITIONAL BENEFITS:
After your first dividend has been reinvested, the Plan permits you to
purchase additional shares through voluntary cash investments.
For more information, please write or call:
MAHONING NATIONAL BANK
TRUST DEPARTMENT - DIVIDEND REINVESTMENT
P.O. BOX 479
YOUNGSTOWN, OH 44501-0479
330/742-7035
THE LOCAL BANK THAT HAS IT ALL
MAHONING NATIONAL BANK
EQUAL HOUSING OPPORTUNITY MEMBER F.D.I.C.
- --------------------------------------------------------------------------------
<PAGE> 17
PROXY FOR ANNUAL MEETING OF
MAHONING NATIONAL BANCORP, INC.
YOUNGSTOWN, OHIO
KNOW ALL MEN BY THESE PRESENTS, THAT I, THE UNDERSIGNED SHAREHOLDER OF
MAHONING NATIONAL BANCORP, INC. YOUNGSTOWN, OHIO, DO HEREBY NOMINATE,
CONSTITUTE, AND APPOINT ROBERT J. EDWARDS AND/OR HELENE GRAN SALRENO, OR EITHER
ONE OF THEM (WITH FULL POWER OF SUBSTITUTION FOR ME AND IN MY NAME, PLACE AND
STEAD) TO VOTE, INCLUDING THE RIGHT TO VOTE CUMULATIVELY IN THEIR DISCRETION,
ALL THE COMMON STOCK OF SAID CORPORATION, STANDING IN MY NAME ON ITS BOOKS ON
JANUARY 30, 1998, AT THE ANNUAL MEETING OF ITS SHAREHOLDERS TO BE HELD AT THE
MAIN OFFICE OF THE MAHONING NATIONAL BANK OF YOUNGSTOWN, OHIO, 23 FEDERAL PLAZA,
YOUNGSTOWN, OHIO ON MARCH 17, 1998 AT 11:00 AM (LOCAL TIME), OR ANY ADJOURNMENTS
THEREOF WITH ALL THE POWERS THE UNDERSIGNED WOULD POSSESS IF PERSONALLY PRESENT
AS FOLLOWS:
(CONTINUED ON REVERSE SIDE)
PLEASE SIGN AND RETURN IMMEDIATELY
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
- --------------------------------------------------------------------------------
GENERATIONS OF FAMILIES TRUST IN US
As many families in the Mahoning Valley know, Mahoning National Bank's
Trust and Investments Department has always been the place customers come to for
service, knowledge, experience and investment returns at above market averages.
For over 125 years we've helped generations of families with their
investment needs--for their enjoyment today and tomorrow.
How do we do this? We've simply perfected a system that is geared to each
individual's needs. We gain a thorough understanding of your financial
requirements and then give you expert advice and recommendations. Our financial
experts tailor a personalized plan for you and then we dedicate ourselves to the
growth of your funds.
Our services include Investment Management, Pension and 401(k)
Administration, Estate Planning, Custodial Agencies and more.
For any size investment, we help you create and build wealth for you
and your family... for your future.
Please call us today at 330/742-7035 to arrange for your free
consultation.
[PHOTO]
"MAHONING NATIONAL IS COMMITTED TO MAINTAINING AND IMPROVING ITS HIGH LEVEL OF
SERVICE." J. DAVID SABINE, SENIOR VICE PRESIDENT, 27 YEARS OF INVESTMENT, TRUST
MANAGEMENT AND ESTATE PLANNING EXPERIENCE
MAHONING NATIONAL BANK
TRUST AND INVESTMENTS SERVICES
