<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ x ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
LAUREL CAPITAL GROUP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[ X ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration No.: ____________________
(3) Filing Party: __________________________________________
(4) Dated Filed: ___________________________________________
<PAGE> 2
LAUREL CAPITAL GROUP, INC.
2724 HARTS RUN ROAD
ALLISON PARK, PENNSYLVANIA 15101
(412) 487-7400
NOTICE OF ANNUAL MEETING
TO BE HELD ON NOVEMBER 13, 1997
NOTICE IS HEREBY GIVEN that an Annual Meeting of Stockholders of
Laurel Capital Group, Inc. (the "Company") will be held at the Holiday Inn -
Allegheny Valley, R.I.D.C. Park, 180 Gamma Drive, Pittsburgh, Pennsylvania
15238, on Thursday, November 13, 1997 at 10:30 a.m., Eastern Time, for the
following purposes, all of which are more completely set forth in the
accompanying Proxy Statement:
(1) To elect two directors for a term of three years or until
their successors have been elected and qualified;
(2) To ratify the appointment of KPMG Peat Marwick LLP as the
Company's independent auditors for the year ending June 30, 1998; and
(3) To transact such other business as may properly come before
the meeting.
Stockholders of record at the close of business on September 30, 1997
are entitled to notice of and to vote at the Annual Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ JOHN A. HOWARD, JR.
---------------------------
John A. Howard, Jr.
Secretary
Allison Park, Pennsylvania
October 10, 1997
================================================================================
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. IT IS IMPORTANT
THAT YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN IF
YOU PLAN TO BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE
ENCLOSED PROXY PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THIS MEETING,
YOU MAY VOTE EITHER IN PERSON OR BY YOUR PROXY. ANY PROXY GIVEN MAY BE
REVOKED BY YOU IN WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE
THEREOF.
================================================================================
1
<PAGE> 3
LAUREL CAPITAL GROUP, INC.
-----------
PROXY STATEMENT
-----------
ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is furnished to the holders of common stock of
Laurel Capital Group, Inc. (the "Company") in connection with the solicitation
of proxies on behalf of the Board of Directors, to be used at the Annual
Meeting of Stockholders ("Annual Meeting") to be held at the Holiday Inn -
Allegheny Valley, R.I.D.C. Park, 180 Gamma Drive, Pittsburgh, Pennsylvania
15238, on Thursday, November 13, 1997 at 10:30 a.m., Eastern Time, and at any
adjournment thereof for the purposes set forth in the Notice of Annual Meeting.
This Proxy Statement is expected to be mailed to stockholders on or about
October 10, 1997.
Each proxy solicited hereby, if properly signed and returned to the
Company, will be voted in accordance with the instructions contained therein if
it is not revoked prior to its use. If no contrary instructions are given, each
proxy received will be voted (i) for the election of the two nominees for
director described herein, (ii) for the ratification of KPMG Peat Marwick LLP
as the Company's independent auditors for the year ending June 30, 1998, and
(iii) upon such other matters as may properly come before the Annual Meeting in
accordance with the best judgment of the persons appointed as proxies. Any
stockholder giving a proxy has the power to revoke it at any time before it is
exercised by (i) filing with the Secretary of the Company written notice
thereof (John A. Howard, Jr., Secretary, Laurel Capital Group, Inc., 2724 Harts
Run Road, Allison Park, Pennsylvania 15101), (ii) submitting a duly executed
proxy bearing a later date, or (iii) by appearing at the Annual Meeting and
giving the Secretary notice of his or her intention to vote in person. Proxies
solicited hereby may be exercised only at the Annual Meeting and any
adjournment thereof and will not be used for any other meeting.
Laurel Capital Group, Inc. is a bank holding company and the parent
holding company for Laurel Savings Bank (the "Bank"), a Pennsylvania-chartered
stock savings bank. The Company owns 100% of the Bank's common stock.
VOTING SECURITIES AND BENEFICIAL
OWNERSHIP THEREOF
Only stockholders of record at the close of business on September 30,
1997 ("Voting Record Date") will be entitled to vote at the Annual Meeting. On
the Voting Record Date, there were 1,445,957 shares of common stock, $.01 par
value per share (the "Common Stock"), of the Company outstanding. The Company
had no other class of equity securities outstanding. Each share of Common Stock
is entitled to one vote at the Annual Meeting.
Directors are elected by a plurality of the votes cast with a quorum
present. A quorum consists of stockholders representing, either in person or by
proxy, a majority of the outstanding Common Stock entitled to vote at the
Annual Meeting. Abstentions are considered in determining the presence of a
quorum and will not affect the plurality vote required for the election of
directors. The affirmative vote of the holder of a majority of the total votes
present in person or by proxy is required to ratify the appointment of the
independent auditors. Under rules of the New York Stock Exchange, the proposal
for ratification of the auditors is considered a "discretionary" item upon
which brokerage firms may vote in their discretion on behalf of their clients
if such clients have not furnished voting instructions and for which there will
not be "broker non-votes."
2
<PAGE> 4
PRINCIPAL HOLDERS OF COMMON STOCK
The following table sets forth information as of September 30, 1997
with respect to ownership of the Common Stock by the one entity which is known
to the Company to be the beneficial owner of more than 5% of the Common Stock
and by all directors and executive officers of the Company as a group. For
information with respect to the beneficial ownership of Common Stock by
individual directors, see "Information with Respect to Nominees for Director,
Directors Whose Terms Continue and Executive Officers."
<TABLE>
<CAPTION>
Name and Address Amount and Nature Percent
of Beneficial Owner of Beneficial Ownership(1) of Class(1)
------------------- -------------------------- -----------
<S> <C> <C>
First Manhattan Company 142,712 9.9%
437 Madison Avenue
New York, New York 10022
All directors and executive
officers as a group (10 persons) 188,646(2) 13.1%
</TABLE>
- -------
(1) Based upon information provided by the respective beneficial owners and
filings with the Securities and Exchange Commission ("SEC") made pursuant to
the Securities Exchange Act of 1934, as amended ("Exchange Act"), and other
information. The amounts and percentages reflect the stock splits declared and
paid by the Company prior to the Voting Record Date. Beneficial ownership is
direct except as otherwise indicated by footnote. In accordance with Rule 13d-3
of the Exchange Act, a person is deemed to be the beneficial owner of a
security if he or she has or shares voting power or dispositive power with
respect to such security or has the right to acquire such ownership within 60
days.
(2) Includes options covering 91,752 shares of Common Stock which are
exercisable within 60 days of September 30, 1997. See "Information with Respect
to Nominees for Director, Directors Whose Terms Continue and Executive
Officers."
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR,
DIRECTORS WHOSE TERMS CONTINUE AND EXECUTIVE OFFICERS
ELECTION OF DIRECTORS
The Bylaws of the Company presently provide that the Board of
Directors shall consist of seven members. The Company's Bylaws further provide
that the Board of Directors shall be divided into three classes as nearly equal
in number as possible. The members of each class are to be elected for a term
of three years and until their successors are elected and qualified. One class
of directors is to be elected annually. There are no arrangements or
understandings between the Company and any person pursuant to which such person
has been elected a director. No director is related to any other director or
any executive officer of the Company or the Bank by blood, marriage or
adoption.
3
<PAGE> 5
THE NOMINEES
Unless otherwise directed, each proxy executed and returned by a
stockholder will be voted for the election of all the nominees for director
listed below. If any of the nominees should be unable or unwilling to stand for
election at the time of the Annual Meeting, the proxies will nominate and vote
for the replacement nominee recommended by the Board of Directors. As of the
date hereof, the Board of Directors knows of no reason why the persons listed
below may not be able to serve as a director if elected.
Article 7.F. of the Company's Articles of Incorporation provides that,
with respect to this Annual Meeting, stockholders may submit nominations for
election to the Board of Directors to the Secretary of the Company so that it
is delivered or received no later than the close of business on the 60th day
prior to the anniversary date of the immediately preceding Annual Meeting of
Stockholders of the Company. Article 7.F. also sets forth the required
information in such notice of nomination. No nominations were submitted by
stockholders in connection with the Annual Meeting.
Nominees for director will be elected by a plurality of the votes cast
by the shares of Common Stock entitled to vote in the election at the Annual
Meeting. Abstentions and broker non-votes will have no effect on the vote.
NOMINEES FOR DIRECTOR FOR THREE-YEAR TERM EXPIRING IN 2000
<TABLE>
<CAPTION>
POSITION WITH THE COMPANY COMMON STOCK
AND PRINCIPAL OCCUPATION BENEFICIALLY
DURING THE PAST FIVE DIRECTOR OWNED AS OF
NAME AGE YEARS(1) SINCE SEPTEMBER 30, 1997(2)(3)
---- --- -------------------------- -------- ------------------------
AMOUNT PERCENTAGE
------ ----------
<S> <C> <C> <C> <C> <C>
Harvey J. Haughton 84 Director; retired; previously Vice 1972 18,042 1.3%
President of Finance, Jones and Laughlin
Steel Corporation, Pittsburgh,
Pennsylvania.
Annette D. Ganassi 41 Director; President/ 1992 11,697 (4)
Owner of Annette
Ganassi Oldsmobile,
Pontiac, GMC Truck,
Glenshaw,
Pennsylvania.
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS THAT THE ABOVE
NOMINEES BE ELECTED AS DIRECTORS.
4
<PAGE> 6
MEMBERS OF THE BOARD CONTINUING IN OFFICE
DIRECTORS WHOSE TERMS EXPIRE IN 1998
<TABLE>
<CAPTION>
POSITION WITH THE COMPANY COMMON STOCK
AND PRINCIPAL OCCUPATION BENEFICIALLY
DURING THE PAST FIVE DIRECTOR OWNED AS OF
NAME AGE YEARS(1) SINCE SEPTEMBER 30, 1997(2)(3)
---- --- ------------------------- -------- ------------------------
AMOUNT PERCENTAGE
------ ----------
<S> <C> <C> <C> <C> <C>
Richard J. Cessar 68 Chairman of the Board since 1996; retired; 1969 11,674 (4)(5)(7)
previously Pennsylvania State legislator.
Arthur G. Borland 67 Director; retired; previously Secretary, 1986 10,999 (4)(8)
Oberg Manufacturing Company, Inc., a
manufacturer of carbide stamping dyes,
Freeport, Pennsylvania.
</TABLE>
DIRECTORS WHOSE TERMS EXPIRE IN 1999
<TABLE>
<CAPTION>
POSITION WITH THE COMPANY COMMON STOCK
AND PRINCIPAL OCCUPATION BENEFICIALLY
DURING THE PAST FIVE DIRECTOR OWNED AS OF
NAME AGE YEARS(1) SINCE SEPTEMBER 30, 1997(2)(3)
---- --- ------------------------ -------- ------------------------
AMOUNT PERCENTAGE
------ ----------
<S> <C> <C> <C> <C> <C>
Richard S. Hamilton 52 Director; President of AAA of 1986 16,861 1.2%
West Penn/West Virginia,
Pittsburgh, Pennsylvania.
J. Harold Norris 71 Director, retired; previously 1967 13,125 (4)(5)
Department Manager, Port
Authority of Allegheny County,
Pittsburgh, Pennsylvania.
Edwin R. Maus 55 Director; President and Chief 1989 59,901 4.1%(6)
Executive Officer of the
Company since 1992; President
and Chief Executive Officer of
the Bank since 1989; joined the
Bank in 1987 as Vice President
of Operations.
</TABLE>
- ---------------
(1) Unless otherwise noted, each director has held his or her currently listed
position for the last five years.
(FOOTNOTES CONTINUED ON FOLLOWING PAGE)
- --------------
5
<PAGE> 7
(2) Based on information furnished by the respective individuals. Under
applicable regulations, shares are deemed to be beneficially owned by a person
if he or she directly or indirectly has or shares the power to vote or dispose
of the shares, whether or not he or she has any economic interest in the
shares. Unless otherwise indicated, the named beneficial owner has sole voting
and dispositive power with respect to the shares.
(3) Under applicable regulations, a person is also deemed to have beneficial
ownership of any shares which may be acquired within 60 days pursuant to the
exercise of outstanding stock options. The amounts set forth in the table
include shares which may be received upon exercise of stock options within 60
days of the Voting Record Date as follows: Mr. Maus, 34,983 shares; Ms.
Ganassi, 4,861 shares; Mr. Hamilton 4,860 shares; Messrs. Borland and Cessar,
4,797 shares each and Messrs. Haughton and Norris, 3,860 shares each.
(4) Represents less than 1% of the Common Stock outstanding.
(5) Other than shares subject to options, the shares are owned jointly with the
respective individual's spouse.
(6) Includes 18,563 shares owned jointly with Mr. Maus' spouse and 6,355
shares held in an IRA.
(7) Represents 1,036 shares held jointly with Mr. Cessar's spouse
(8) Includes 877 shares held jointly with Mr. Borland's children
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
The following information is provided with respect to executive
officers of the Company and/or the Bank who are not also directors. There are
no arrangements or understandings between the Company or the Bank and any
person pursuant to which a person has been elected as an officer.
RICHARD P. BRUCKMAN - Mr. Bruckman joined the Bank in 1964, has served
in various positions with the Bank, including branch manager, and served as
Vice President of Finance of the Bank from 1982 until June 1992 when he assumed
the position of Vice President-Controller.
JOHN A. HOWARD, JR. - Mr. Howard joined the Bank in July 1992 as Chief
Financial Officer, was appointed a Vice President in August 1992, a Senior Vice
President in July 1994 and Corporate Secretary/Treasurer in August 1994. Mr.
Howard presently serves in the same capacities for the Company. From 1985 until
July 1992, Mr. Howard served in various positions with Community Bancorp, Inc.
and its wholly owned subsidiary, Community Savings Bank, Monroeville,
Pennsylvania, including Controller, Chief Financial Officer and Senior Vice
President.
BERNARD W. PRAZER - Mr. Prazer joined the Bank in May 1991 as Vice
President of Lending. From December 1990 to May 1991, Mr. Prazer served as a
consultant with Asset Strategy Group, New York, New York, a company which
performs due diligence for the Resolution Trust Corporation. From 1989 to 1990,
Mr. Prazer served as Vice President of Bauer Capital Management Corporation,
Pittsburgh, Pennsylvania, a construction development company, and from 1979 to
1989 served in various positions with Atlantic Financial Federal, Pittsburgh,
Pennsylvania including Vice President and Chief Regional Lending Officer for
the Western Pennsylvania Region.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's officers and
directors, and persons who own more than 10% of the Common Stock, to file
reports of ownership and changes in ownership with the SEC and the
6
<PAGE> 8
National Association of Securities Dealers, Inc. ("NASD"). Officers, directors
and greater than 10% stockholders are required by regulation to furnish the
Company with copies of all Section 16(a) forms they file. The Company knows of
no person who owns 10% or more of the Common Stock.
Based solely on review of the copies of such forms furnished to the
Company, the Company believes that during fiscal 1997, all Section 16(a) filing
requirements applicable to its officers and directors were complied with,
thereby.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company meets on an as needed basis.
Each member of the Board of Directors of the Company also serves as a trustee
of the Bank. During the year ended June 30, 1997, the Board of Directors of the
Company met thirteen times. No director attended fewer than 75% of the
aggregate of the total number of Board meetings of the Company held during
fiscal 1997 and the total number of meetings held by committees on which he or
she served during the year. Directors of the Company did not receive any fees
directly from the Company during fiscal 1997.
The Executive Committee is authorized to exercise all the authority of
the Board of Directors in the management of the Company between Board meetings
except as otherwise provided in the Company's Bylaws. During fiscal 1997 the
Executive Committee consisted of Messrs. Cessar, Maus, Haughton and Norris. The
Executive Committee did not meet during the year ended June 30, 1997.
The Audit Committee supervises the internal audit function, reviews
with management and independent auditors the systems of internal controls and
monitors the Company's adherence in accounting and financial reporting to
generally accepted accounting principles. During fiscal 1997 the Audit
Committee consisted of Messrs. Borland, Haughton and Ms. Ganassi. The Audit
Committee met twice in fiscal 1997.
The entire Board of Directors acts as the Nominating Committee. The
Nominating Committee recommends persons to serve as directors in order to fill
vacancies on the Board which may occur and makes nominations for directors to
be elected by the stockholders of the Company. The Nominating Committee met in
August, 1997. Although the Nominating Committee will consider nominees
recommended by stockholders, it has not actively solicited recommendations for
nominees from stockholders. If such stockholder nominations are properly made,
ballots will be provided bearing the name of the stockholders' nominee or
nominees at the Annual Meeting.
The Personnel Committee establishes and monitors policies, practices
and procedures relating to the compensation of, and incentive programs for, the
Company's executive management and other employees. The Personnel Committee
also reviews job performance of the Company's officers. During fiscal 1997 the
Personnel Committee consisted of Messrs. Borland, Hamilton and Norris. The
Personnel Committee met five times during fiscal 1997.
The Board of Trustees of the Bank meets regularly each month and may
have additional special meetings. During fiscal 1997, no director attended less
than 75% of both the number of Board meetings and any meetings of committees
thereof on which he or she served during the year. The Bank pays each trustee,
other than Mr. Maus, $1,000 per month and the Chairman of the Board receives
$1,300 per month. The Board of Trustees of the Bank has established various
standing committees of the Board, including Audit Committee, Personnel
Committee and Executive Committee, which perform substantially similar duties
as the comparable committees of the Board of Directors of the Company.
PERSONNEL COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The performance of both the Company and the Bank are evaluated along
with the contributions as related to
7
<PAGE> 9
the job performance of each member of senior management. Such evaluation is the
basis for determining compensation and benefits afforded senior management.
Economic conditions, similar financial services data and peer group comparison
surveys provide additional information to assist in the compensation review
process.
Employment contracts between Laurel Capital Group, Inc., Laurel
Savings Bank and two senior management executives were amended in February,
1997 to extend their term for an additional one year period effective February
8, 1997.
Net income for fiscal 1997 totaled $2.3 million while the combined
assets of the Bank and the Company increased approximately 7.6%. As a result of
this profitability and growth, the Personnel Committee increased the annual
salary of Chief Executive Officer, Edwin R. Maus, by 7.8% and paid him a bonus
approximately equal to 1.8 times his fiscal 1997 monthly salary.
Submitted by the Personnel Committee: Arthur G. Borland, Richard S.
Hamilton, J. Harold Norris.
PERFORMANCE GRAPH
The following table and graph compares the yearly cumulative total
return of the Common Stock over a five-year measurement period with (i) the
yearly cumulative total return on the stocks included in the Nasdaq Market
Index and (ii) the yearly cumulative total return on the stocks included in the
Nasdaq Bank Stock Market Index as reported by the Center for Research in
Securities Prices at the University of Chicago. The per share amounts have been
adjusted to reflect the five-for-four stock splits on August 14, 1992,
September 17, 1993 and November 15, 1994 and the three-for-two stock split on
September 15, 1995. All of these cumulative returns are computed assuming the
reinvestment of dividends at the frequency with which dividends were paid
during the applicable years.
TABLE OF CUMULATIVE VALUES
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Laurel Capital Group, Inc..... $100.00 $163.14 $281.72 $386.37 $421.27 $511.25
Nasdaq Market Index......... 100.00 120.13 151.08 152.52 203.59 261.37
Nasdaq Banks Index.......... 100.00 138.87 182.50 206.03 235.56 306.83
Book Value Per Share........ 11.76 13.12 14.83 16.57 19.06 21.56
Market Value Per Share...... 5.50 8.70 14.72 19.84 21.20 25.25
</TABLE>
LAUREL CAPITAL GROUP, INC. COMPARATIVE PERFORMANCE GRAPH
<TABLE>
<CAPTION>
FISCAL YEAR
1992 1993 1994 1995 1996 1997
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Laurel Capital Group, Inc. $100.00 $163.14 $281.72 $386.37 $421.27 $511.25
Nasdaq 100.00 120.13 151.08 152.52 203.59 261.37
Nasdaq Banks 100.00 138.87 182.50 206.03 235.56 306.83
</TABLE>
8
<PAGE> 10
EXECUTIVE COMPENSATION
REMUNERATION OF EXECUTIVE OFFICER
SUMMARY COMPENSATION TABLE. The Summary Compensation Table below
includes compensation information on the President and Chief Executive Officer
of the Company during the fiscal years ended June 30, 1997, 1996 and 1995. There
were no other executive officers of the Company or the Bank whose total
compensation exceeded $100,000 for services rendered in all capacities during
the fiscal years ended June 30, 1997, 1996 and 1995.
<TABLE>
<CAPTION>
Name and Principal Fiscal All Other
Position Year Annual Compensation Compensation(1)
------------------ ------ ----------------------------------------- ---------------
Other Annual
Salary Bonus Compensation(2)
------ ----- ---------------
<S> <C> <C> <C> <C> <C>
Edwin R. Maus 1997 $128,000 $19,200 $0 $7,360
President and Chief 1996 120,000 18,000 0 6,900
Executive Officer 1995 112,200 16,300 0 6,425
</TABLE>
- --------------
(1) Includes employer matching contributions accrued pursuant to the
Bank's defined contribution pension plan. See "-Pension Plan."
(2) Does not include amounts attributable to miscellaneous benefits
received by the named executive officer. In the opinion of management
of the Company, the costs to the Company of providing such benefits to
the named executive officer during the year ended June 30, 1997 did
not exceed the lesser of $50,000 or 10% of the total annual salary and
bonus reported for such individual.
STOCK OPTIONS
No options were granted to Mr. Maus during fiscal 1997 and Mr. Maus
did not exercise any options during such period. The following table sets forth
for Mr. Maus information with respect to the aggregate number of unexercised
options at the end of the fiscal year and the value with respect thereto.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND YEAR END OPTION VALUES
<TABLE>
<CAPTION>
==========================================================================================
Number of Unexercised Options Value of Unexercised Options
at Year End at Year End(1)
Name ----------------------------------------------------------------
Exercisable Unexercisable Exercisable Unexercisable
------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Edwin R. Maus 37,911 9,757 $295,714 $46,346
==========================================================================================
</TABLE>
- ----------------
(1) Based on the average of the bid and asked prices of the Common Stock
of $21.125 at June 30, 1997.
9
<PAGE> 11
EMPLOYMENT AGREEMENT
The Company and the Bank (collectively, the "Employers") have entered
into an employment agreement ("Agreement") with Edwin R. Maus for a term of
three years in his current position as President and Chief Executive Officer at
a minimum base salary of $100,000 per year. The Board of Directors of the
Employers and Mr. Maus may mutually agree to extend the term of the Agreement
for an additional one year as of each or any annual anniversary of the date of
the Agreement by affirmatively approving an addendum to the Agreement at least
45 days prior to such anniversary date.
The Agreement is terminable with or without cause by the Employers.
The officer shall have no right to compensation or other benefits pursuant to
the Agreement for any period after voluntary termination or termination by the
Employers for cause, disability, retirement or death, provided, however, that
(i) in the event that the officer terminates his employment because of failure
of the Employer to comply with any material provision of the Agreement or (ii)
the Agreement is terminated by the Employers other than for cause, disability,
retirement or death or by the officer as a result of certain adverse actions
which are taken with respect to the officer's employment following a Change in
Control of the Company, as defined, the officer will be entitled to a cash
severance amount equal to 2.99 times his base salary.
Although the above-described Agreement could increase the cost of any
acquisition of control of the Company, management of the Company does not
believe that the terms thereof would have a significant anti-takeover effect.
10
<PAGE> 12
PENSION PLAN
The Bank has a defined contribution pension plan for qualifying
employees of the Bank which allows such employees to make contributions
("Employee Contributions") as permitted by Section 401(k) of the Internal
Revenue Code of 1986, as amended (the "Code"). The Bank makes annual
contributions equal to 5% of an employee's annual compensation ("Employer
Contributions"). Prior to October 1, 1993, Employer Contributions were 100%
vested only after five years of service and subsequent to October 1, 1993,
Employer Contributions become 20% vested after two years of service, 50% vested
after three years, 75% vested after four years and 100% vested after five
years. Employer Contributions also become fully vested upon normal retirement
at age 65 or upon the death or permanent and complete disability of a
participant while employed by the Bank. Employee Contributions, which may be
either pre-tax contributions or after-tax contributions, are always fully
vested and non-forfeitable.
INDEBTEDNESS OF MANAGEMENT
The Bank offers to its directors, officers and employees first
mortgage loans for the financing of their primary residences, second mortgage
loans secured by the borrower's primary residence which may be used for any
purpose, and consumer loans of all kinds. Any credit extended by the Bank to
its executive officers, directors and, to the extent otherwise permitted,
principal stockholder(s), or any related interest of the foregoing, must (i) be
on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions by the Bank with
non-affiliated parties and (ii) not involve more than the normal risk of
repayment or present other unfavorable features. Loans previously made by the
Bank to such persons remain in effect pursuant to their original terms.
However, officers and directors of the Bank may receive loans pursuant to
employee benefit programs, provided that the program is widely available to all
employees of the Bank and does not give preference to such officers and
directors over other employees. These loans were otherwise made in the normal
course of business on substantially the same terms as those prevailing at the
time for comparable transactions with non-affiliated persons, including, but
not limited to, the payment of fees and requirements for collateral. Upon
termination of employment, the interest rate on these loans is increased to the
market rate that existed at the time the loan was made. It is the belief of
management that these loans neither involve more than the normal risk of
collectability nor present other unfavorable features. No director, executive
officer or any member of their immediate families had preferential loans in
excess of $60,000 during fiscal year 1997.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors of the Company has appointed KPMG Peat Marwick
LLP as independent auditors of the Company for the year ending June 30, 1998
and has further directed that the selection of such auditors be submitted for
ratification by the stockholders at the Annual Meeting. The Company has been
advised by KPMG Peat Marwick LLP that neither that firm nor any of its
associates has any relationship with the Company or the Bank other than the
usual relationship that exists between independent certified public accountants
and clients. KPMG Peat Marwick LLP will have a representative at the Annual
Meeting who will have an opportunity to make a statement, if he or she so
desires, and who will be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE RATIFICATION
OF THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS THE COMPANY'S INDEPENDENT
AUDITORS FOR FISCAL 1998.
11
<PAGE> 13
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have presented at the next
Annual Meeting of Stockholders, to be held in November 1998, must be received
at the main office of the Company, 2724 Harts Run Road, Allison Park,
Pennsylvania 15101, no later than June 12, 1998. If such proposal is in
compliance with all of the requirements of Rule 14a-8 of the Exchange Act, it
will be included in the Proxy Statement and set forth on the form of proxy
issued for the next Annual Meeting of Stockholders. It is urged that any such
proposals be sent by certified mail, return receipt requested.
ANNUAL REPORTS
A copy of the Company's Annual Report to Stockholders for the year
ended June 30, 1997 accompanies this Proxy Statement. Such Annual Report is not
part of the proxy solicitation materials.
UPON RECEIPT OF A WRITTEN REQUEST, THE COMPANY WILL FURNISH TO ANY
STOCKHOLDER WITHOUT CHARGE A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K
("FORM 10-K") FOR THE YEAR ENDED JUNE 30, 1997 AND THE LIST OF THE EXHIBITS
THERETO REQUIRED TO BE FILED WITH THE SEC UNDER THE EXCHANGE ACT. SUCH WRITTEN
REQUEST SHOULD BE DIRECTED TO MR. EDWIN R. MAUS, PRESIDENT, LAUREL CAPITAL
GROUP, INC., 2724 HARTS RUN ROAD, ALLISON PARK, PENNSYLVANIA 15101. THE FORM
10-K IS NOT PART OF THE PROXY SOLICITATION MATERIALS.
OTHER MATTERS
Each proxy solicited hereby also confers discretionary authority on
the Board of Directors of the Company to vote the proxy with respect to the
approval of the minutes of the last meeting of stockholders, the election of
any person as director if a nominee is unable to serve or for good cause will
not serve, matters incident to the conduct of the meeting, and upon such other
matters as may properly come before the Annual Meeting. Management is not aware
of any business that may properly come before the Annual Meeting other than
those matters described above in this Proxy Statement. However, if any other
matters should properly come before the Annual Meeting, it is intended that the
proxies solicited hereby will be voted with respect to those other matters in
accordance with the judgment of the persons voting the proxies.
The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of the Company's Common Stock. In addition to
solicitations by mail, directors, officers and employees of the Company may
solicit proxies personally or by telephone without additional compensation.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ JOHN A. HOWARD, JR.
---------------------------
John A. Howard, Jr.
Secretary
October 10, 1997
12
<PAGE> 14
REVOCABLE PROXY
LAUREL CAPITAL GROUP, INC.
[ X ] PLEASE MARK VOTES
AS IN THIS EXAMPLE
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF LAUREL
CAPITAL GROUP, INC. (THE "COMPANY") FOR USE ONLY AT THE ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD ON NOVEMBER 13, 1997 AND AT ANY ADJOURNMENT THEREOF.
The undersigned, being a stockholder of the Company, hereby appoints the
Board of Directors or any successor thereto as proxies with full powers of
substitution, and hereby authorizes them to represent and vote, as designated on
this proxy card, all the shares of common stock of the Company ("Common Stock")
held of record by the undersigned on September 30, 1997 at the Annual Meeting of
Stockholders to be held at the Holiday Inn-Allegheny Valley, R.I.D.C. Park, 180
Gamma Drive, Pittsburgh, Pennsylvania 15238 on Thursday, November 13, 1997 at
10:30 a.m., Eastern Time, or any adjournment thereof, and thereat to act with
respect to all votes that the undersigned would be entitled to cast, if then
personally present, as set forth on this proxy card (the Board of Directors
recommends that stockholders vote FOR proposals 1 and 2).
-------------------------
Please be sure to sign and date Date
this Proxy in the box below.
- -----------------------------------------------------------------------------
- ------Stockholder sign above -------------- Co-holder (if any) sign above----
SHARES OF COMMON STOCK OF THE COMPANY WILL BE VOTED AS SPECIFIED. IF NOT
OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL OF THE
NOMINEES NAMED IN PROPOSAL 1, FOR PROPOSAL 2, AND OTHERWISE AT THE DISCRETION OF
THE PROXIES. THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR
PROPOSALS 1 AND 2. THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE TIME IT IS
EXERCISED AT THE ANNUAL MEETING.
WITH-
FOR HOLD EXCEPT
1. ELECTION OF DIRECTORS [ ] [ ] [ ]
Nominees for three-year term:
ANNETTE D. GANASSI AND HARVEY J. HAUGHTON
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK
"EXCEPT" AND WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.
- ----------------------------------------------------------------------------
FOR AGAINST ABSTAIN
2. PROPOSAL to ratify the appointment [ ] [ ] [ ]
of KPMG Peat Marwick LLP as the
Company's independent auditors for
fiscal 1998.
PLEASE CHECK BOX IF YOU PLAN ------------------ [ ]
TO ATTEND THE MEETING.
3. In their discretion, the proxies are authorized to vote with respect to
matters incident to the conduct of the meeting and upon such other business
as may properly come before the Annual Meeting.
DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE PAID ENVELOPE PROVIDED.
LAUREL CAPITAL GROUP, INC.
- ----------------------------------------------------------------------------
The above signed hereby acknowledges receipt of a Notice of Annual Meeting
of Laurel Capital Group, Inc. to be held on November 13, 1997 and any
adjournment thereof, and a Proxy Statement for the Annual Meeting prior to the
signing of this proxy card.
Please sign exactly as your name(s) appear(s) on this proxy card. When
signing in a representative capacity, please give title. Only one signature is
required in the case of a joint account.
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
- ----------------------------------------------------------------------------
