SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
[ X ] Filed by the registrant
[ ] 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 ss. 240.14a-11(c) or ss. 240.14a-12
FFW CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
<PAGE>
[FFW CORPORATION LETTERHEAD]
September 27, 1999
Dear Fellow Stockholder:
On behalf of the Board of Directors and management of FFW Corporation
(the "Company"), we cordially invite you to attend the Annual Meeting (the
"Meeting") of Stockholders of the Company. The Meeting will be held at 2:30
p.m., Wabash, Indiana time, on October 26, 1999, at the office of the Company
located at 1205 North Cass Street, Wabash, Indiana.
An important aspect of the meeting process is the stockholder vote on
corporate business items. I urge you to exercise your rights as a stockholder to
vote and participate in this process. Stockholders are being asked to elect two
directors of the Company and to ratify the appointment of Crowe, Chizek and
Company LLP as the company's auditors. Accordingly, your Board of Directors
unanimously recommends that you vote for each of the proposals.
We encourage you to attend the Meeting in person. Whether or not you
plan to attend, however, please read the enclosed Proxy Statement and then
complete, sign and date the enclosed proxy card and return it in the
accompanying postpaid return envelope as promptly as possible. This will save
the Company additional expense in soliciting proxies and will ensure that your
shares are represented at the Meeting.
Thank you for your attention to this important matter.
Very truly yours,
/s/NICHOLAS M. GEORGE
---------------------
NICHOLAS M. GEORGE
President and Chief Executive Officer
<PAGE>
FFW CORPORATION
1205 North Cass Street
Wabash, Indiana 46992
(219) 563-3185
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held on October 26, 1999
Notice is hereby given that an Annual Meeting of Stockholders (the
"Meeting") of FFW Corporation ("FFW" or the "Company") will be held at the
office of the Company located at 1205 North Cass Street, Wabash, Indiana, at
2:30 p.m. Wabash, Indiana time, on October 26, 1999.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. The election of two directors of the Company;
2. The ratification of the appointment of Crowe, Chizek and
Company LLP as auditors for the Company for the fiscal year
ended June 30, 2000;
and such other matters as may properly come before the Meeting or any
adjournments thereof. The Board of Directors is not aware of any other business
to come before the Meeting.
Any action may be taken on the foregoing proposals at the Meeting on
the date specified above, or on any date or dates to which the Meeting may be
adjourned. Stockholders of record at the close of business on September 15,
1999, are the stockholders entitled to vote at the Meeting and any adjournments
thereof.
You are requested to complete and sign the enclosed proxy card which is
solicited on behalf of the Board of Directors, and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend and vote at the
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/WAYNE W. REES
----------------
WAYNE W. REES
Chairman of the Board and Secretary
Wabash, Indiana
September 27, 1999
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
WITHIN THE UNITED STATES.
- --------------------------------------------------------------------------------
<PAGE>
PROXY STATEMENT
FFW CORPORATION
1205 North Cass Street
Wabash, Indiana 46992
(219) 563-3185
ANNUAL MEETING OF STOCKHOLDERS
October 26, 1999
This Proxy Statement is furnished in connection with the solicitation
on behalf of the Board of Directors of FFW Corporation ("FFW" or the "Company")
of proxies to be used at the Annual Meeting of Stockholders of the Company (the
"Meeting") which will be held at the office of the Company, located at 1205
North Cass Street, Wabash, Indiana, on October 26, 1999, at 2:30 p.m., Wabash,
Indiana time, and all adjournments of the Meeting. The accompanying Notice of
Meeting and this Proxy Statement are first being mailed to stockholders on or
about September 27, 1999. Certain of the information provided herein relates to
First Federal Savings Bank of Wabash ("First Federal" or the "Bank"), a wholly
owned subsidiary of the Company.
At the Meeting, stockholders of the Company are being asked to consider
and vote upon (i) the election of two directors of the Company and (ii) the
ratification of the appointment of Crowe, Chizek and Company LLP as the
Company's auditors for the fiscal year ending June 30, 2000.
Vote Required and Proxy Information
All shares of Company common stock ("Common Stock") represented at the
Meeting by properly executed proxies received prior to or at the Meeting, and
not revoked, will be voted at the Meeting in accordance with the instructions
thereon. If no instructions are indicated, properly executed proxies will be
voted for the nominees and the adoption of the proposals set forth in this Proxy
Statement. The Company does not know of any matters, other than those described
in the Notice of the Meeting, that are to come before the Meeting. If any other
matters are properly presented at the Meeting for action, the persons named in
the enclosed proxy card and acting thereunder will have the discretion to vote
on such matters in accordance with their best judgment.
The Company maintains an Employee Stock Ownership Plan ("ESOP") which
owns approximately 7.71% of the Company's common stock and in which employees of
the Company and the Bank participate. Pursuant to the terms of the ESOP, each
ESOP participant has the right to direct the trustee of the ESOP how to vote the
shares of Common Stock allocated to his or her account under the ESOP. If an
ESOP participant properly executes the proxy distributed by the trustee of the
ESOP, the ESOP trustee will vote the shares represented by that proxy at the
Meeting. Where an ESOP participant specifies a choice, the proxy will be voted
in accordance with the ESOP participant's instructions. If no specific direction
is given, the ESOP trustee will vote the shares "FOR" the election of
management's nominees for directors of the Company and "FOR" each of the other
proposals described in this Proxy Statement. If other matters are presented at
the Meeting, the shares for which proxies have been received will be voted in
accordance with the discretion of the proxies. The trustee of the ESOP will vote
the unallocated ESOP shares in the same proportion as voted allocated shares.
Directors shall be elected by a plurality of the votes present in
person or represented by proxy at the Meeting and entitled to vote on the
election of directors. In all matters other than the election of directors, the
affirmative vote of the majority of shares present in person or represented by
proxy at the Meeting and entitled to vote on the matter will be the act of the
stockholders. With regard to the election of directors, votes may be cast in
favor of or withheld from each nominee; votes that are withheld will be excluded
<PAGE>
entirely from the vote and will have no effect. Abstentions may be specified on
all proposals except the election of directors and will be counted as present
for purposes of the item on which the abstention is noted. Abstentions on the
proposal to ratify Crowe, Chizek and Company LLP as the Corporation's auditors
will have the effect of a negative vote since that proposal requires the
affirmative vote of a majority of the shares present in person or by proxy and
entitled to vote at the Meeting. A broker non-vote (i.e., proxies from brokers
or nominees indicating that such persons have not received instructions from the
beneficial owners or other persons as to certain proposals on which such
beneficial owners or persons are entitled to vote their shares but with respect
to which the brokers or nominees have no discretionary power to vote without
such instructions) will have no effect on the outcome of the election of
directors or ratification of auditors.
A proxy given pursuant to the solicitation may be revoked at any time
before it is voted. Proxies may be revoked by: (i) filing with the Secretary of
the Company at or before the Meeting a written notice of revocation bearing a
later date than the proxy; (ii) duly executing a subsequent proxy relating to
the same shares and delivering it to the Secretary of the Company at or before
the Meeting; or (iii) attending the Meeting and voting in person (although
attendance at the Meeting will not in and of itself constitute revocation of a
proxy). Any written notice revoking a proxy should be delivered to Wayne W.
Rees, Secretary, FFW Corporation, 1205 North Cass Street, Wabash, Indiana 46992.
Voting Securities and Principal Holders Thereof
Stockholders of record as of the close of business on September 15,
1999 (the "Voting Record Date"), will be entitled to one vote for each share
then held. As of that date, the Company had 1,441,224 shares of Common Stock
issued and outstanding. The following table sets forth information, as of the
Voting Record Date, regarding share ownership of: (i) those persons or entities
known by management to beneficially own more than five percent of the Company's
Common Stock and (ii) all directors and executive officers as a group. See
"Proposal I - Election of Directors" for beneficial share ownership of the
directors and the Chief Executive Officer.
<TABLE>
<CAPTION>
Shares
Beneficially Percent
Beneficial Owner Owned(1) of Class
- ------------------------------------------------------------------------ ------------ -------
<S> <C> <C>
FFW Corporation, Inc. Employee Stock Ownership Plan 111,190 7.71%
1025 North Cass Street
Wabash, IN 46992-1027(2)
The Midwest Bank Fund II, L.P.; Bank Fund III, L.P.; Bank Fund IV, L.P.; 124,022 8.61
Bank Fund III Trust; and Bank Fund IV Trust (collectively, the "Funds")
208 S. LaSalle Street
Chicago, Illinois 60604(3)
First Manhattan Co.(4) 114,860 7.97
437 Madison Avenue
New York, NY 10022
Mr. and Mrs. Nicholas M. George(5) 128,315 8.75
4185 S 550 W
Wabash, IN 46992
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Directors and executive officers of the Company and the Bank as a group 291,925 19.82
(7 persons)(6)
</TABLE>
- -----------------------
(1) All amounts reported in this column have been adjusted to reflect the
two-for-one stock split paid by the Company in the form of a 100% stock
dividend on December 31, 1997 (the "Stock Dividend").
(2) The amount reported represents shares held by the Employee Stock
Ownership Plan ("ESOP"), 109,740 of which were allocated to accounts of
participants. Pursuant to the terms of the ESOP, each ESOP participant
has the right to direct the voting of shares of Common Stock allocated
to his or her account. Ronald J. Metz, the trustee of the ESOP, may be
deemed to beneficially own the shares held by the ESOP which have not
been allocated to the accounts of participants or shares which are not
voted by participants. Unallocated shares will be voted by the trustee
in the same proportion as the voted allocated shares.
(3) As reported in an amended Schedule 13D filed with the Securities and
Exchange Commission ("SEC") on or about August 2, 1996. The Midwest
Bank Fund II, L.P., Bank Fund III, L.P., the Bank Fund III Trust, the
Bank Fund IV, L.P. and the Bank Fund IV Trust reported sole voting and
dispositive powers as to 8,718 shares (17,436 shares, as adjusted for
the Stock Dividend), 10,403 (20,806) shares, 31,890 (63,780) shares,
2,512 (5,042) shares, and 8,479 (16,958) shares of Common Stock,
respectively.
(4) As reported in a Schedule 13G, dated February 11, 1999, in which First
Manhattan Co. reported sole voting and dispositive power over 114,860
shares of Common Stock.
(5) Includes 39,102 shares held directly by Mr. George, 38,590 shares held
jointly with Mrs. George, 3,998 shares held directly by Mrs. George,
2,000 shares held jointly by Mr. George and his son, 25,250 shares
subject to options which options are exercisable within 60 days of the
Voting Record Date and 19,375 shares allocated to Mr. George's account
under the ESOP.
(6) Includes shares held directly, as well as, jointly with family members,
and shares held in retirement accounts in a fiduciary capacity or by
certain family members, with respect to which shares the listed
individuals or group members may be deemed to have sole voting and/or
investment power. This table also includes 31,925 shares subject to
options granted under the Company's 1992 Stock Option and Incentive
Plan (the "Stock Option Plan") and the Company's 1998 Omnibus Incentive
Plan (the "Omnibus Incentive Plan"), to directors and executive
officers which options are exercisable within 60 days of the Voting
Record Date.
PROPOSAL I - ELECTION OF DIRECTORS
General
The Company's Board of Directors is divided into three classes, each of
which contains approximately one-third of the Board. Directors of the Company
are generally elected to serve for a three-year period or until their respective
successors are elected and qualified. The Company's Board of Directors currently
consists of six members. Each of the directors of the Company has served in such
capacity since its incorporation in December 1992.
<PAGE>
The table below sets forth certain information, as of the Voting Record
Date, regarding the composition of the Company's Board of Directors, including
each director's term of office. The Board of Directors acting as the nominating
committee has recommended and approved the nominees identified as set forth in
the following table. It is intended that the proxies solicited on behalf of the
Board of Directors (other than proxies in which the vote is withheld as to a
nominee) will be voted at the Meeting "For" the election of the nominees
identified below. If a nominee is unable to serve, the shares represented by all
valid proxies will be voted for the election of such substitute nominee as the
Board of Directors may recommend. At this time, the Board of Directors knows of
no reason why any nominee may be unable to serve, if elected. Except as
disclosed herein, there are no arrangements or understandings between the
nominees and any other person pursuant to which the nominees were selected.
3
<PAGE>
<TABLE>
<CAPTION>
Shares of
Common
Term Stock
Director to Beneficially Percent
Name Age Position(s) Held in the Company Since(1) Expire Owned(2) of Class
---- --- ------------------------------- -------- ------ -------- --------
Nominees
<S> <C> <C> <C> <C> <C>
Thomas L. Frank 56 Director 1987 2002 33,824 2.34%
J. Stanley Myers 52 Director 1985 2002 35,114 2.43
Directors Continuing in Office
Wayne W. Rees 61 Chairman of the Board and Secretary 1983 2000 50,874 3.52
Ronald D. Reynolds 52 Director 1991 2000 20,924 1.45
Nicholas M. George 52 President and Chief Executive Officer 1977 2001 128,315(3) 8.75
Joseph W. McSpadden 51 Director 1987 2001 20,874(4) 1.45
</TABLE>
(1) Includes service as a director of the Bank.
(2) The nature of beneficial ownership for shares reported in this column
is sole voting and investment power, except as otherwise noted in these
footnotes. All amounts reported under this column have been adjusted
for the Stock Dividend. Included in the shares beneficially owned by
the named individuals are options to purchase shares of Common Stock
which options are exercisable within 60 days of the Voting Record Date,
totaling 25,250 for Mr. George; 0 for Mr. McSpadden; 1,225 for Mr.
Frank; 5,450 for Mr. Myers; 0 for Mr. Rees; and 0 for Mr. Reynolds.
(3) See footnote 4 on page 3 for additional information regarding shares
beneficially owned by Mr. George.
(4) Excludes 2,000 shares of stock held by a corporation in which Mr.
McSpadden is a minority shareholder. Mr. McSpadden expressly disclaims
beneficial ownership with respect to such shares.
The principal occupation of each director of the Company is set forth
below. All directors have held their present position for at least five years
unless otherwise indicated.
Thomas L. Frank. Mr. Frank is the Comptroller for B. Walter & Company,
a manufacturer of wood furniture and products located in Wabash, Indiana.
J. Stanley Myers. Mr. Myers is the owner and operator of ServiSoft
Water Conditioning, Inc., a soft water appliance company located in Wabash,
Indiana.
Wayne W. Rees. Mr. Rees is the owner and publisher of The Paper of
Wabash County, Inc., a newspaper published in Wabash, Indiana. Mr. Rees has been
Chairman of the Board and Secretary of the Company since December 1992. Mr. Rees
has served as Chairman of the Bank's Board of Directors since July 1992.
Ronald D. Reynolds. Mr. Reynolds is the owner of J. M. Reynolds Oil
Co., Inc., an oil supply company located in Wabash, Indiana.
<PAGE>
Nicholas M. George. Mr. George is the President and Chief Executive
Officer of the Company, a position he has held since December 1992. Mr. George
is also President and Chief Executive Officer of First Federal, a position he
has held for the past 20 years. Mr. George joined First Federal as a vice
president in 1972 and was promoted to President in 1976. Mr. George has
responsibility for the overall management and establishment of First Federal's
objectives, policies, and strategic plans. He assists in the overall
4
<PAGE>
administration of First Federal, including the implementation of and reporting
on policies and plans adopted by the Board of Directors. He also serves as
Chairman of the Board of FirstFed Financial of Wabash, Inc., the Company's
subsidiary. He has served as a Director of FirstFed Financial of Wabash, Inc.
since 1989.
Joseph W. McSpadden. Mr. McSpadden is the Vice President and part owner
of Beauchamp & McSpadden, an insurance agency located in Wabash, Indiana.
Meetings and Committees of the Board of Directors
Meetings and Committees of the Company. Meetings of the Company's Board
of Directors are generally held on a monthly basis. The Board of Directors met
12 times during fiscal 1999. During fiscal 1999, no incumbent director of the
Company attended fewer than 75% of the aggregate of the total number of Board
meetings and the total number of meetings held by the committees of the Board of
Directors on which he served.
The Board of Directors of the Company has standing audit, stock option
and nominating committees, as well as other committees which meet as needed.
The Audit Committee recommends independent auditors to the Board,
reviews the results of the auditors' services, reviews with management and the
internal auditors the systems of internal control and internal audit reports and
assures that the books and records of the Company are kept in accordance with
applicable accounting principles and standards. The members of the Audit
Committee are Directors George, Frank and McSpadden and Chief Financial Officer
Roger Cromer. During the fiscal year ended June 30, 1999, this Committee met
four times.
The Stock Option Committee is composed of Directors Frank, Reynolds and
George. This Committee is responsible for administering the Company's Stock
Option Plan and Omnibus Incentive Plan, as well as reviewing compensation and
benefit matters. This Committee met once during the fiscal year ended June 30,
1999.
The entire Board of Directors acts as a nominating committee for
selecting nominees for election as directors. While the Board of Directors of
the Company will consider nominees recommended by stockholders, the Board has
not actively solicited such nominations. Pursuant to the Company's Bylaws,
nominations by stockholders must be delivered in writing (as prescribed by the
Bylaws) to the Secretary of the Company at least 30 days before the date of the
Meeting; provided, however, that in the event that less than 40 days' notice of
the date of the Meeting is given or made to stockholders, notice by the
stockholder must be so received not later than the close of business on the
tenth day following the day on which such notice of the date of the meeting was
mailed. This Committee met once during the fiscal year ended June 30, 1999.
Meetings and Committees of the Bank. Meetings of the Bank's Board of
Directors are generally held on a monthly basis. The Board of Directors met 12
times during the fiscal year ended June 30, 1999. During fiscal 1999, no
incumbent director of the Bank attended fewer than 75% of the aggregate of the
total number of Board meetings and the total number of meetings held by the
committees of the Board of Directors on which he served.
The Bank has standing, audit, personnel/compensation, and nominating
committees. The Bank also has other Committees which meet as needed to review
various other functions of the Bank.
<PAGE>
The Audit Committee of the Bank is composed of Directors George, Frank
and McSpadden and Chief Financial Officer Roger Cromer. The Audit Committee
meets on a quarterly basis to review budgets and is responsible for reviewing
the annual audit report and reporting to the full Board of Directors. This
5
<PAGE>
committee also meets with the Bank's external auditors prior to the annual audit
to review audit procedures. This committee met four times during the fiscal year
ended June 30, 1999.
The Personnel/Compensation Committee of the Bank establishes and
reviews compensation, bonuses, benefits and the personnel policies of the Bank.
The current members of this committee are Directors George, Frank and Reynolds.
This committee meets at least annually on an as needed basis. The committee met
three times during the fiscal year ended June 30, 1999.
The Nominating Committee of the Bank is comprised of the entire board
of directors. The committee makes written nominations prior to the annual
meeting. This committee held one meeting during fiscal 1999.
Director Compensation
Cash Compensation. The Company's directors are paid a fee of $200.00
per meeting attended for serving on the Company's Board of Directors. No fee is
paid for membership on the Company's committees. All present members of the
Company's Board of Directors are also members of the Bank's Board of Directors.
All Bank directors, other than the Chairman, receive a fee of $700.00 per
meeting attended. The Chairman of the Bank receives a fee of $800.00 per meeting
attended. No fees are paid to directors of the Bank for committee membership.
Deferred Compensation Plan ("DCP"). In 1986, the Bank adopted the DCP
for the benefit of its directors. The DCP is a voluntary deferred compensation
plan which permits directors of the Bank to defer receipt of all or a portion of
their regular board fees. This plan was established to hold and attract quality
directors by providing a retirement benefit in amounts related to Board fees
deferred annually. Under the DCP, a participant or his beneficiary, will receive
retirement payments (equal to the amount deferred plus interest accrued thereon)
payable in monthly installments upon retirement from the Board at age 70.
If the director's service on the Board ceases for any reason other than
death or disability, prior to age 70, amounts deferred pursuant to the DCP will
be held by the Bank until the director reaches age 70. In the event of death or
disability of the director while serving on the Bank's board, monthly or annual
payments will be made to the director or his designated beneficiary. In the
event of the director's death following retirement, the remaining benefits will
be paid to the designated beneficiary. These benefit payments are not subject to
any reduction for Social Security benefits or other offset amounts. Until
disbursed, the amounts due and payable under the DCPs continue to be assets of
the Bank, subject to the claims of general creditors. During fiscal 1999, no
directors were deferring compensation pursuant to the DCP.
Executive Compensation
The following table sets forth information regarding compensation paid
to the Chief Executive Officer of the Company for services rendered during the
fiscal year ended June 30, 1999. No other executive officer made in excess of
$100,000 during the fiscal year ended June 30, 1999.
6
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term
Compensation
Annual Compensation (1) Awards
- --------------------------------------------------------------------- ---------------------
Restricted
Stock Options/ All Other
Salary Bonus Award(s) SARs Compensation
Name and Principal Position Year ($)(2) ($) ($) (#) ($)
- ----------------------------------------------------------- ------------------------ -------------------------
<S> <C> <C> <C> <C> <C> <C>
Nicholas M. George 1999 $126,655 $34,250 --- --- $5,284(3)
President and CEO 1998 115,134 30,062 --- --- 5,314
1997 110,699 24,019 --- --- 4,706
</TABLE>
- -------------------------
(1) Mr. George did not receive any additional benefits or perquisites which
exceeded, in the aggregate, the lesser of 10% of his salary and bonus,
or $50,000.
(2) Includes $6,951, $7,085 and $5,963 of compensation deferred at the
individual's election pursuant to the 401(k) plan and $10,800, $10,800
and $10,200 paid for service as a director for fiscal 1999, 1998 and
1997, respectively.
(3) Includes 401(k) plan contributions of $3,476 and disability insurance
premiums of $1,808 paid by the Bank on behalf of
Mr. George during fiscal 1999.
The following table sets forth information regarding the number and
value of stock options at June 30, 1999 held by the Company's Chief Executive
Officer.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
Shares Number of Unexercised Value of Unexercised In-the-Money
Acquired Value Options at FY-End(#) Options at FY-End ($)(1)
on Exercise Realized ---------------------------- ------------------------------
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
---- --- --- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Nicholas M. George 5,582 $53,381 25,250 0 $217,781 $0
</TABLE>
- ------------------
(1) Represents the aggregate market value (market price of the Common Stock
less the exercise price) of the option granted based upon the average
of the bid and asked price of $13.625 per share of the Common Stock as
reported on the Nasdaq Small-Cap Market on June 30, 1999.
7
<PAGE>
Employment Agreement and Salary Continuation Plan
Employment Agreements. The Bank has an employment agreement with
Nicholas M. George, as well as with certain other executive officers, each for a
three-year term. The employment agreements provide for an annual base salary as
determined by the Board of Directors. Salary increases are reviewed not less
often than annually thereafter, and are subject to the sole discretion of the
Board of Directors. The employment contracts provide for an extension for one
additional year upon authorization by the Board of Directors at the end of each
year. The contracts provide for termination upon the employee's death, for cause
or upon certain events specified by Office of Thrift Supervision ("OTS")
regulations. The employment contracts are terminable by the respective employee
upon 90 days' notice to the Bank. The employment contracts provide for payment
to the employee, in the event there is a change in control of the Company or the
Bank, as defined in such agreement, where employment terminates involuntarily in
connection with such change in control or within 12 months thereafter, of the
remaining salary payable under the contract, plus a termination payment equal to
299% of the respective employee's highest salary in effect under the employment
contract at any time during the 12 months prior to the date of termination,
provided that total payments made to each employee under his or her respective
employment agreement may not exceed three
8
<PAGE>
times the employee's annual salary or an amount that would cause certain adverse
tax consequences to the Bank and the employee under Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"). Assuming a change in control were
to take place as of June 30, 1999, the aggregate amount payable to Mr. George
pursuant to this change in control provision would be approximately $343,850.
Each contract contains a provision which prohibits the employee, for a
period of one year, from, directly or indirectly, owning, managing, operating or
controlling, or participating in the ownership, management, operation or control
of, or be employed by or connected in any manner with, any financial institution
having an office located within 20 miles of any office of the Bank at the date
of the employee's termination. The contracts provide, among other things, for
participation in an equitable manner in employee benefits applicable to
executive personnel. These employment contracts may have an "anti-takeover"
effect that could affect a proposed future acquisition of control of the Bank.
Salary Continuation Plan. Effective October 1992, the Bank adopted a
salary continuation plan for the benefit of Mr. George in order to encourage Mr.
George's continued employment with the Bank until November 1, 2011 (the
"retirement date"). The plan provides cash benefits to Mr. George or his
designated beneficiary upon Mr. George's retirement, early retirement or death
while employed by the Bank, provided that Mr. George gives the Bank six months'
written notice of any early retirement. This cash benefit, as described in the
plan, is increased for each year Mr. George remains employed by the Bank. The
Bank has purchased an annuity to fund its obligations under this plan.
In the event Mr. George voluntarily terminates his employment with the
Bank for any reason other than death, Mr. George would be entitled to receive
$86,702 at June 30, 1999. In the event of Mr. George's death, his beneficiary
would be entitled to receive $419,776 at June 30, 1999.
Certain Transactions
The Bank, like many financial institutions, has followed a policy of
granting to officers, directors and employees loans secured by the borrower's
residence and consumer loans. All loans to the Bank's officers and directors are
made in the ordinary course of business and on the same terms, including
interest rate and collateral, and conditions as those of comparable transactions
prevailing at the time, and do not involve more than the normal risk of
collectibility or present other unfavorable features.
PROPOSAL II - RATIFICATION OF THE APPOINTMENT OF AUDITORS
The Board of Directors has renewed the Company's arrangement for Crowe,
Chizek and Company LLP to be its auditors for the 2000 fiscal year, subject to
the ratification of the appointment by the Company's stockholders. A
representative of Crowe, Chizek and Company LLP is expected to attend the
Meeting to respond to appropriate questions and will have an opportunity to make
a statement if he so desires.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF CROWE, CHIZEK AND COMPANY LLP AS THE
COMPANY'S AUDITORS FOR THE FISCAL YEAR ENDING JUNE 30, 2000.
9
<PAGE>
STOCKHOLDER PROPOSALS
In order to be eligible for inclusion in the Company's proxy materials
for the next Annual Meeting of Stockholders, any stockholder proposal to take
action at such meeting must be received at the Company's main office located at
1205 North Cass Street, Wabash, Indiana 46992, no later than May 30, 2000. Any
such proposal shall be subject to the requirements of the proxy rules adopted
under the Securities Exchange Act of 1934 as amended. Otherwise, any stockholder
proposal to take action at such meeting must be received at the Company's
executive office, at 1205 North Cass Street, Wabash, Indiana 46992 on or before
September 24, 2000 (30 days prior to next years anticipated annual meeting
date). In the event that the date of next year's annual meeting changes, a
stockholder proposal must be received not later than 30 days prior to the new
date of such annual meeting; provided, however, that in the event that less than
40 days notice or prior disclosure of the new date of annual meeting is given or
made to stockholders, notice of a proposal by a stockholder to be timely must be
received not later than the close of business on the tenth day following the day
on which notice of the new date of the annual meeting was mailed or public
announcement of the new date of such meeting was first made. All stockholder
proposals must also comply with the Company's bylaws and Delaware law.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than 10% of
the Company's Common Stock (or any other equity securities, of which there is
none), to file with the SEC initial reports of ownership and reports of changes
in ownership of the Company's Common Stock. Officers, directors and greater than
10% shareholders are required by SEC regulations to furnish the Company with
copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written representations that no other
reports were required during the fiscal year ended June 30, 1999, all Section
16(a) filing requirements applicable to its officers, directors and greater than
10% beneficial owners were complied with except that Mr. George and Mr. Frank
inadvertently failed to timely file Form 4s to report one transaction each. Mr.
George and Mr. Frank reported their transactions on Form 4s dated July 28, 1999.
OTHER MATTERS
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matter should properly come before the Meeting, it is
intended that holders of the proxies will act in accordance with their best
judgment.
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 Common Stock. In addition to solicitation by mail,
directors, officers and regular employees of the Company and/or the Bank may
solicit proxies personally or by telegraph or telephone without additional
compensation.
10
<PAGE>
REVOCABLE PROXY
FFW CORPORATION
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 26, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints the Board of Directors of FFW Corporation (the
"Company"), and its survivor, with full power of substitution, to act as
attorneys and proxies for the undersigned to vote all shares of common stock of
the Company which the undersigned is entitled to vote at the Annual Meeting of
Stockholders (the "Meeting"), to be held on October 26, 1999 at 2:30 p.m., local
time, and at any and all adjournments thereof, as follows:
I. The election of Thomas L. Frank and J. Stanley Myers as directors for a term
to expire in 2002.
With- For All
For hold Except
[ ] [ ] [ ]
INSTRUCTION: To withhold authority to vote for any individual nominee, mark
"For All Except" and write that nominee's name in the space provided below.
- --------------------------------------------------------------------------------
II. The ratification of the appointment of Crowe, Chizek and Company LLP as
auditors of the Company for the fiscal year ending June 30, 2000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
In their discretion, the proxies are authorized to vote on any other business
that may properly come before the Meeting or any adjournment thereof.
The Board of Directors recommends a vote "FOR" the listed proposals.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED FOR THE PROPOSALS STATED. IF ANY OTHER BUSINESS IS
PRESENTED AT SUCH MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY
IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO
OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
<PAGE>
Please sign exactly as your name(s) appear(s) above on this card. When signing
as attorney, executor, administrator, trustee, guardian or corporate officer
please give your full title. If shares are held jointly, each holder should
sign.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
FFW CORPORATION
The above signed acknowledges receipt from the Company, prior to the execution
of this Proxy, of Notice of the Meeting, a Proxy Statement dated on or about
September 27, 1999 and the Company's Annual Report to Stockholders for the
fiscal year ended June 30, 1999.
The stockholder may revoke this proxy by: (i) filing with the Secretary of the
Company at or before the Meeting a written notice of revocation bearing a later
date than the proxy; (ii) duly executing a subsequent proxy relating to the same
shares and delivering it to the Secretary of the Company at or before the
Meeting; or (iii) attending the Meeting and voting in person (athough attendance
at the Meeting will not in and of itself constitute revocation of a proxy).
PLEASE PROMPTLY COMPLETE, DATE, SIGN AND MAIL
THIS PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
