Exhibit 10.16

                              EMPLOYMENT AGREEMENT

         This Agreement is made and entered into this 1st day of December, 1998,
by and between American National Bank and Trust Company of Muncie, Indiana,
located at 110 E. Main Street, Muncie, Indiana 47305 (hereinafter referred to as
Bank), and ANB Corporation, an Indiana corporation which owns Bank (hereinafter
referred to as Corporation), with its principal office located at 120 W. Charles
Street, Muncie, Indiana 47305 and Douglas E. Carl, (hereinafter referred to as
Executive) of 1507 Ironwood Drive, Marion, IN 46952.

                                WITNESSETH THAT:

         WHEREAS, Executive is employed as an officer of the Bank and has
devoted his ability, time, effort and energies to the affairs of the Bank; and

         WHEREAS, the Bank considers the continuance of proficient and
experienced management to be essential to protecting and enhancing the best
interest of the Bank, Corporation and its shareholders; and

         WHEREAS, the Bank and Corporation desire to assure themselves of
retaining the services of the Executive (including his services without
distraction by uncertainty and risk of unemployment) in the event of a proposed
Change of Control (as hereinafter defined) of the Bank and/or the Corporation;
and

         WHEREAS, the Bank and Corporation desire to compensate the Executive
should his employment terminate under certain hereinafter enumerated
circumstances after a Change of Control, and to clarify that no such
compensation is payable in the event Executive is terminated for Cause, as
defined in this Agreement.

         NOW THEREFORE, IN CONSIDERATION of the foregoing recitals, the mutual
promises contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree that the above recitals are included as a part of this agreement.

                                    ARTICLE I
                                   DEFINITIONS

         For purposes of this Agreement, the terms in this Article shall have
the following meaning throughout this Agreement:

         (A) Cause: "Cause" to terminate Executive's employment exists when the
Executive:

                  (1)      willfully and continually fails to substantially
                           perform his duties with the Bank and/or Corporation;
                           or

                  (2)      substantially fails to meet the performance goals, or
                           reasonable policies and regulations established by
                           the Bank and/or Corporation; or

                  (3)      is adjudged guilty of any crime involving a breach of
                           fiduciary duties to the Bank and/or Corporation; or

                  (4)      willfully violates the Bank's or the Corporation's
                           Code of Conduct or any rules and regulations relating
                           to any existing banking law; or


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                  (5)      acts in a manner which is detrimental to the Bank's
                           or Corporation's best interests, its reputation in
                           the community, or its standing in the banking
                           industry.

         (B) Change of Control: A "Change of Control" occurs if:

                  (1)      any person, partnership, corporation, trust or
                           similar group, other than the Corporation or Bank as
                           the case may be, acquires more than
                           twenty-fivepercent (25%) of the voting securities of
                           the Corporation or the Bank in a transaction or
                           series of transactions; or

                  (2)      at any time a majority of the Board of Directors of
                           the Corporation or the Bank are not Continuing
                           Directors as defined under the Articles of
                           Incorporation of the Corporation or the Bank.

         (C) Date of Termination: "Date of Termination" shall mean the date
stated in the Notice of Termination or thirty (30) days from the date of
delivery of such notice, whichever comes first.

         (D) Disability: "Disability" shall mean the definition of such term as
used in the disability policy then in effect for the Bank and a determination of
full disability by the parties; provided that in the event there is no
disability insurance then in force, "disability" shall mean incapacity due to
physical or mental illness, which will have caused Executive to have been unable
to perform his duties with the Bank and/or Corporation on a full time basis for
180 consecutive calendar days.

         (E) Notice of Termination: "Notice of Termination" shall mean a written
notice, communicated to the other parties hereto, which shall indicate the
specific termination provisions of this Agreement relied upon and set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Executive's employment under the provisions so indicated.

         (F) Retirement: "Retirement" shall mean termination of employment by
the Bank and/or Corporation or by the Executive in accordance with Bank's or
Corporation's normal retirement policy generally applicable to its salaried
employees in effect at the time of Change of Control.

         (G) Unreasonable Changes: An "Unreasonable Change" occurs if any of the
following events occur:

                  (1)      without Executive's express written consent and after
                           a Change of Control, the assignment to him of any
                           duties materially inconsistent with his position,
                           duties, and responsibility with the Bank and/or
                           Corporation immediately prior to a Change of Control;

                  (2)      without Executive's express written consent and after
                           a Change of Control, a reduction by the Bank and/or
                           Corporation in the Executive' annual salary;

                  (3)      without Executive's express written consent and after
                           a Change of Control, the Bank and/or Corporation
                           requires Executive to be relocated anywhere other
                           than the offices in Muncie, Indiana, and Bank and/or
                           Corporation fail to pay all reasonable moving
                           expenses incurred by him relating to a change of his
                           principal residence in connection with such
                           relocation including an obligation by the Bank and/or
                           Corporation to

<PAGE>

                           provide a customary home guarantee purchase of the
                           Executive's residence, the value of the home to be
                           determined by at least one real estate appraiser
                           designated by him and satisfactory to the Bank and/or
                           Corporation;

                  (4)      without Executive's express written consent and after
                           a Change of Control (1) the failure by the Bank
                           and/or Corporation to continue in effect (or to
                           substitute plans providing him with no less than
                           substantially similar benefits) any compensation plan
                           or benefit plans including, but not limited to, any
                           retirement or pension plan, savings plan, life
                           insurance plan, health and accident or disability
                           plan in which Executive is participating at the time
                           of a Change of Control; or (2) in the event the Bank
                           and/or Corporation institutes new or revised
                           compensation or benefit plans which provide more
                           favorable benefits than the plans in which Executive
                           is participating at the time of a Change of Control,
                           the failure of the Bank and/or Corporation to entitle
                           Executive to participate in and receive benefits
                           under any such new or revised plans providing more
                           favorable benefits; or (3) the taking of any action
                           by the Bank that would adversely affect Executive's
                           participation in or materially reduce his benefits
                           under any of such plans described in either (1) or
                           (2) of this paragraph;

                  (5)      without Executive's express written consent and after
                           a Change of Control, the taking of any action by the
                           Bank and/or Corporation to deprive Executive of any
                           material fringe benefit enjoyed by him at the time of
                           the Change of Control, or the failure by the Bank
                           and/or Corporation to provide him with the number of
                           paid vacation days to which he is entitled on the
                           basis of years of service with the Bank and/or
                           Corporation and in accordance with the Bank's and/or
                           Corporation's normal vacation policy in effect at the
                           time of Change of Control; or

                  (6)      the failure of the Bank and/or Corporation to obtain
                           the assumption of this Agreement by any successor as
                           contemplated in this Agreement.

                                   ARTICLE II
                              EMPLOYMENT AND TERM

         Bank hereby employs Executive as its President. The term of this
Agreement shall commence on the date hereof and this Agreement shall remain in
continuous effect until a Notice of Termination is given to the contrary by
either party to the other, subject to the provisions of Article III hereof;
provided, however, if a Change of Control shall occur on or before the date on
which Notice of Termination is received, the term of this Agreement shall extend
and be binding upon all parties hereto and their successors and assigns for a
period of two (2) years from the date on which such Change of Control occurs.

                                  ARTICLE III
                                  TERMINATION

         (A) In the absence of a Change of Control or threat of Change of
Control:

                  (1)      the Bank and/or Corporation may terminate the
                           Executive without regard to the provisions of this
                           Agreement and this Agreement shall have no

<PAGE>

                           relevance to the issues surrounding said termination;
                           and

                  (2)      Executive may terminate his employment with the Bank
                           and/or Corporation without regard to the provisions
                           of this Agreement, and this Agreement shall have no
                           relevance to the issues surrounding said termination.

         (B) In the event any person, persons or entity commences a tender or
exchange offer, or circulates a proxy to the Corporation's shareholders designed
to effect a Change of Control, Executive agrees that he will not voluntarily
leave his employment with the Bank and/or Corporation and will continue to
perform his regular duties, until such person, persons or entity has abandoned
or terminated its efforts to effect a Change of Control. In the event any
person, persons or entity successfully concludes a tender or exchange offer, or
has successfully circulated a proxy to the Corporation's shareholders effecting
a Change of Control, Executive agrees that he will not voluntarily leave his
employment with the Bank and/or Corporation and will continue to perform his
regular duties, subject to the provisions of Articles III and IV of this
Agreement.

         (C) If, following a Change of Control, the Executive's employment shall
be terminated for Cause, the Bank and Corporation shall pay him his full salary
through the Date of Termination at the rate in effect on the date of the Notice
of Termination, and the Bank and Corporation shall have no further obligations
under this Agreement. If, following a Change of Control, the Executive's
employment shall be terminated as a result of death, disability, or Retirement,
compensation to the Executive shall be made pursuant to the Bank's and
Corporation's then existing policies on death, disability or retirement, and the
Bank and the Corporation shall have no further obligations under this Agreement.

         (D) If a Change of Control occurs and within a twenty-four (24) month
period thereafter an Unreasonable Change occurs to Executive's employment
relationship, the Executive shall be entitled to resign with justification, and
shall be entitled to the benefits provided in sub-paragraph (E) of this Article.
If the Executive invokes the rights pertaining to resignation with
justification, the Executive's notice of resignation shall state that the
Executive's resignation is in the best interests of the Bank and/or Corporation
considering the circumstances of the Change of Control and Unreasonable Change,
and that it is not his intent to resign for the sole purpose of collecting
compensation without working for it.

         (E) If, within twenty-four (24) months of a Change of Control, the Bank
and/or Corporation shall terminate Executive's employment other than for death,
disability, Retirement or Cause, or if Executive shall resign in accordance with
sub-paragraph (D) of this Article, the Bank and/or Corporation shall:

                  (1)      pay Executive his salary after the Change of Control
                           through the Date of Termination plus the aggregate
                           amount of any bonus accrued but unpaid as of such
                           Date of Termination; and,

                  (2)      pay Executive an amount in cash which, when added to
                           the present value of all other compensation, benefits
                           and payments required to be included in the
                           calculation under Section 280G of the Internal
                           Revenue Code and regulations thereunder, shall equal
                           299% of the `base amount' as defined under Section
                           280G of the Internal Revenue Code in effect on
                           December 31, 1992. Such amounts shall be payable in
                           equal installments over thirty-six (36) months from
                           the Date of Termination at the same frequencies as
                           salaries paid to other salaried employees of the Bank
                           and/or Corporation; provided, however, if Executive
                           obtains employment, the Bank's and/or Corporation's
                           obligation to pay such amount above thirty-six (36)
                           months shall continue but shall be reduced

<PAGE>

                           to that amount necessary which, when added to
                           Executive's salary for his new employment, will
                           maintain the Executive at the equal monthly
                           installment amount payable by the Bank and
                           Corporation described above; and,

                  (3)      continue the Executive's participation in the life,
                           accident, disability and health insurance plans of
                           the Bank and/or Corporation, or shall provide
                           equivalent benefits, at no cost to the Executive
                           until the third anniversary of the Date of
                           Termination, or if earlier, at the Executive's
                           commencement of full-time employment with a new
                           employer; provided, however, that in the event
                           Executive shall die before the expiration of the
                           period during which the Bank and/or Corporation would
                           be required to continue Executive's participation in
                           such insurance plans, the participation of the
                           Executive's surviving spouse and family in the Bank's
                           and/or Corporation's insurance plans shall continue
                           in accordance with the Bank's and/or Corporation's
                           standard policy for a spouse and family of a
                           surviving employee in effect at the time of the
                           Change of Control; and,

         (F) Notwithstanding anything contained herein to the contrary, in no
event shall any payment or part thereof be made to the Executive which would be
considered an "excess parachute payment" within the meaning of section Section
280G(b)(1) of the Internal Revenue Code of 1986, as amended.

         The provisions of this sub-paragraph of Article III shall survive
termination of this Agreement and termination of the Executive's employment
under this Agreement.

                                   ARTICLE IV
                               SOURCE OF PAYMENTS

         All payments provided in this Agreement shall be paid in cash from the
general funds of the Bank and/or the Corporation and no special or separate fund
shall be established and no other segregation of assets shall be made to assure
payment. The Executive shall have no right, title, or interest whatsoever in or
to any investments which the Bank and/or Corporation may make to aid the Bank
and/or Corporation in meeting its obligations hereunder. Nothing contained in
this Agreement, and no action taken to fund its provisions, shall create or be
construed to create a trust of any kind, or a fiduciary relationship, between
the Bank and/or Corporation and Executive or any other person. To the extent
that any person acquires a right to receive payments from the Bank and/or
Corporation hereunder, such right shall be no greater than the right of an
unsecured creditor of the Bank and/or the Corporation.

                                   ARTICLE V
                         INDEMNIFICATION AND INSURANCE

         In the event Executive is or was a party or is threatened to be made a
party, to any threatened, pending or completed legal action, suit or proceeding
by reason of the fact that he is or was an officer, director, agent or employee
of the Bank or Corporation or is or was serving at the request of the Bank or
Corporation as an officer, director, agent, or employee of another corporation
or other entity, he shall be fully indemnified by the Bank or Corporation to the
maximum extent permitted by the Articles of Association of Bank or Corporation.
The Executive's costs of defense shall be borne by the Bank or Corporation to
the maximum extent permitted by the Articles of Association of Bank or
Corporation. The right of indemnification

<PAGE>

herein provided shall not be deemed exclusive of any other rights to which
Executive may be entitled as a matter of law and any rights of indemnity under
any policy of insurance carried by the Bank or Corporation. Following a Change
of Control, the Bank or Corporation shall not terminate, or cause or allow to be
terminated, any policy of insurance carried by the Bank or Corporation providing
rights of indemnity to Executive in connection with his service as an officer,
director, agent or employee of the Bank or Corporation, or in connection with
such service rendered at the request of the Bank or Corporation, prior to the
expiration date provided under the terms of such policy, unless the Bank or
Corporation is carrying at such time a substitute policy providing substantially
similar rights of indemnity to Executive. The Bank or Corporation shall provide,
or shall cause any policy of insurance carried by the Bank or Corporation to
provide, rights of indemnity to Executive which are at least equivalent to the
most favorable rights provided to an officer, director, agent or employee of the
Bank or Corporation or the acquiring entity in connection with service rendered
to the Bank or Corporation or the acquiring entity.

                                   ARTICLE VI
                                   SUCCESSORS

         In recognition of the value of continued employment of Executive
following a Change of Control, and in recognition of the need for a smooth
transition of management of the Bank and/or Corporation following a Change of
Control, and in recognition of the need for certainty in the employment status
of Executive at the time of a Change of Control, the parties expressly agree as
follows:

         The Bank and the Corporation will use their best efforts, collectively
and individually, to avoid assisting, permitting or soliciting a Change of
Control, unless the person, persons or entity successfully concluding a tender
or exchange offer, or successfully circulating a proxy to the Corporation's
shareholders effecting a Change of Control shall first have assumed all
obligations and liabilities under this Agreement, and have expressly agreed to
be obligated to perform all of the terms and conditions stated in this Agreement
following the completion of the Change of Control.

                                  ARTICLE VII
                       GUARANTEE BY CORPORATION AND BANK

         In consideration of the value of the continued employment of Executive
by the Bank and the Corporation, and the benefits derived by the Bank and the
Corporation from Executive's employment by the Bank and the Corporation, the
Corporation and the Bank hereby unconditionally and fully guarantee and endorse
the obligations of the other hereunder, and agree to be fully bound by the terms
of this Agreement in the event that the other fails to perform, honor or
otherwise complete fully its obligations hereunder.

                                  ARTICLE VIII
                                 MISCELLANEOUS

         The following terms shall govern this Agreement:

         (A) This Agreement may not be changed orally, but only by agreement in
writing signed by the parties; the waiver by any party of compliance with
provisions of this Agreement by any other party shall not operate or be
construed as a waiver of any subsequent breach by such party.

         (B) The article captions are inserted merely for the purpose of
identification and shall be given no significance in determining the meaning of
any article.

<PAGE>

         (C) This Agreement shall be interpreted and governed by the laws of the
State of Indiana.

         (D) This Agreement shall be binding and inure to the benefit of the
parties hereto, and any successors and assigns of the Bank and the Corporation,
and to any successors, assigns, heirs and the personal representatives of the
Executive.

         (E) The invalidity or unenforceability of any provisions of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect. It is the intent
of the parties that this Agreement be construed and interpreted toward its
validity and that this Agreement shall be deemed modified only to the minimum
extent necessary to sustain any questioned provision.

         IN WITNESS WHEREOF, the Bank and the Corporation have caused this
Employment Agreement to be executed by duly authorized officers of the
respective entities and the seals of the Bank and the Corporation to be affixed
hereto, and the Executive has hereunto subscribed his name, the 1st day of
December, 1998.


"CORPORATION"                               "BANK"

ANB CORPORATION                             AMERICAN NATIONAL BANK &
                                            TRUST COMPANY OF MUNCIE, INDIANA

BY: /s/ Kelly N. Stanley                    BY: /s/ Donald A. Ross
   ------------------------------              ------------------------------
Printed:  Kelly N. Stanley                  Printed:  Donald A. Ross
Its:  Chairman of the Board                 Its:  Chairman of the Board


"EXECUTIVE"

/s/ Douglas E. Carl
---------------------------------
Printed:  Douglas E. Carl