Jasper-based German American Bancorp Inc. (Nasdaq: GABC) is growing. Bloomington-based United Commerce Bancorp is merging into German American. The more than $15 million deal involves United Commerce Bancorp's two offices in Bloomington. July 23, 2013

News Release

JASPER, Ind. and BLOOMINGTON, Ind., July 23, 2013 — German American Bancorp, Inc. (Nasdaq:GABC) (“German American”) and United Commerce Bancorp (OTCBB:UCBN) (“United Commerce”) announced today that they have entered into a definitive agreement to merge United Commerce into German American. Upon completion of the transaction, United Commerce's subsidiary bank, United Commerce Bank, will be merged into German American's similarly-named subsidiary bank, German American Bancorp.

Under the terms of the definitive agreement, United Commerce common shareholders will receive shares of German American common stock at an exchange ratio of .5456 to .6667 GABC shares for each UCBN share (with the exact number to be fixed at closing based on German American's pre-closing market price) in a tax free exchange, plus a cash payment of $1.75 per United Commerce share. This cash payment is subject to reduction to the extent that United Commerce's consolidated common shareholder's equity is not at least equal to a certain level at the time of closing.

Based on the closing price of German American's common shares on July 23, 2013 of $25.94 and UCBN's consolidated shareholders' equity as of June 30, 2013, the transaction has a present indicated value of approximately $15.86 per United Commerce common share. This represents a premium of 69% over the closing price of $9.40 of United Commerce's common shares on July 23, 2013. Because the value of the stock portion of this transaction to holders of United Commerce's common shares as of any future date will be a function of the then-current market price of German American's common stock, the parties expect that the transaction value will vary over the period of time prior to and at closing in the same direction as the market price of German American's common shares varies over that same time period.

Based on United Commerce's number of common shares currently outstanding, and assuming that German American's shares trade during the specified valuation period prior to closing at an average price more than $22.90 per GABC share and that UCBN's common shareholders equity is at least equal to the specified pricing level, German American expects to issue approximately 503,000 shares of its common stock, and to pay approximately $1,575,000 cash, for all of the issued and outstanding common shares of United Commerce that are not now owned by German American.

On this basis, the basic transaction has an aggregate indicated value (valuing German American's common shares at their July 23, 2013, NASDAQ closing price) of approximately $14.6 million. The basic transaction value excludes the indicated value of the approximately 4.6% interest of German American in United Commerce's outstanding stock and the cash payments to be made in cancellation of dilutive stock options and warrants.

The total indicated transaction value is estimated to be approximately $15.3 million. This amount includes an estimated $716,000 of cancellation payments to the holders of United Commerce's outstanding stock options on the basis of German American's July 23, 2013 closing price and the number of options outstanding on that date.

Mark A. Schroeder, Chairman and CEO of German American, stated, “Over the past thirteen years since its formation in January 2000, United Commerce has built a solid community banking organization focused exclusively on the Bloomington market. This transaction provides an excellent opportunity for German American to enhance our presence in the Bloomington market (which we entered in February 2007 through the opening our first office location in the market, followed upon by the market expansion of our downtown financial center in July 2011) through the combination of our two institutions' strong market franchises.

This merger positions German American very well within the Bloomington market through the combined strength of German American's existing exceptional team of local financial professionals and solid base of deposit and loan clients with that of United Commerce. We welcome United Commerce's talented team of local community banking professionals who possess an excellent knowledge of the community and the clients they serve. Additionally, we are also very pleased to be able to welcome the approximately 750 United Commerce shareholders, the vast majority of whom are Bloomington residents, to our family of German American shareholders.”

“We expect that this strategic, in-market opportunity will be accretive to German American's earnings per share during the 12 months following completion of the transaction through the implementation of operating efficiencies and synergies already identified,” said Schroeder. “We have completed extensive on-site diligence, including a review of United Commerce's loan portfolio. Our strong capital base positions us to take advantage of future growth opportunities in the marketplace.”

“We are very pleased to be able to partner with German American, an exceptional community-focused banking organization widely recognized as one the best community banks in the Midwest,” stated Thomas G. Risen, President & CEO of United Commerce. “The merger with German American will provide the capital strength and operational capabilities needed for us to jointly further our mutual vision of building the premiere Bloomington-focused financial services provider. Our operating philosophies, corporate culture, and commitment to serving the community are an excellent fit with German American's corporate philosophy and culture. Our customers will enjoy a broader selection of financial products, services and innovative delivery channels.”

Geoffrey Grodner, Chairman of United Commerce, added, “We are delighted to become a part of German American, which has an excellent reputation, is financially sound, operates under a proven business model, and is well-known as a forward-thinking company with a long track record of successful acquisitions. Our shareholders will be receiving shares of a strong, successful dividend-paying banking company, with greater market liquidity and trading volume than the market for our shares. On behalf

of the board and shareholders of United Commerce, we recognize that this would not have been possible without the excellent work of all of our employees since the time of our founding, including our senior management team led by Tom Risen, our President and CEO, and we sincerely thank them for their efforts on our behalf.”

The transaction is expected to be completed during the fourth quarter of this year. Completion of the transaction is subject to approval by regulatory authorities and United Commerce's shareholders as well as certain other closing conditions, including maintenance by United Commerce of a certain level of consolidated shareholders' equity.

German American was advised by the law firms of Ice Miller LLP and Mark Barnes Law PC. United Commerce was advised by the financial advisory firm of Renninger & Associates, LLC and the law firm of Barnes and Thornburg LLP.


German American will file a Registration Statement on Form S-4 that will include a proxy statement of United Commerce and a prospectus of German American and other relevant documents concerning the proposed merger with the Securities and Exchange Commission. SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. You will be able to obtain a copy of the proxy statement/prospectus, as well as other filings containing information about German American, without charge, at the Securiti

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