Unassociated Document


     

    
      GERMAN
AMERICAN BANCORP, INC.

       

      Offer
of 8% Redeemable Subordinated Debentures due 2019

      Pursuant
to Subscription Rights

       

      [  ],
2009

      To
Securities Dealers, Commercial Banks,

        Trust
Companies and Other Nominees:

       

      This
letter is being distributed by German American Bancorp, Inc. ("GABC") to
securities dealers, commercial banks, trust companies and other nominees in
connection with the rights offering (the "Rights Offering") by GABC of 8%
redeemable subordinated debentures due 2019 (the "Debentures") pursuant to
non-transferable subscription rights (the "Rights") being distributed to all
holders of record of GABC’s common shares, no par value (the "Common Stock"), at
the close of business on [  ], 2009 (the "Record Date"). The Rights
and Debentures are described in the GABC prospectus dated [  ], 2009
(the "Prospectus").

       

      The
Rights will expire, if not exercised, at 5:00 p.m., New York City time, on
[  ], 2009, unless extended in the sole discretion of GABC (as it may
be extended, the "Expiration Date").

       

      As
described in the accompanying Prospectus, holders will receive one (1) Right for
each share of Common Stock owned of record as of the close of business on the
Record Date.

       

      Each
Right entitles the holder to subscribe for $1.36 in principal amount of
Debentures at a subscription price of 100% of the principal amount (the
"Subscription Price") (the "Basic Subscription
Privilege").  Debentures are being issued in denominations of $10,000
and integral multiples of $10,000.  A holder may round up the
principal amount of the holder's Basic Subscription Privilege to the next
highest integral multiple of $10,000 (the "Rounding-Up
Privilege").  For example, if the holder holds 5,000 shares, that
holder would have 5,000 Rights, exercisable for $6,800 in principal amount of
Debentures under the Basic Subscription Privilege, but would be entitled to
subscribe to purchase $10,000 in principal amount of Debentures under the
Rounding-Up Privilege.  If a holder  exercises the holder's
Basic Subscription Privilege in full including the Rounding-Up Privilege, that
holder may also exercise an over-subscription privilege (the "Over-Subscription
Privilege") to purchase additional Debentures that remain unsubscribed for at
the expiration of the Rights Offering. If holders subscribe to purchase a
greater principal amount of Debentures than is available to be purchased
pursuant to the Rights Offering, GABC will allocate the Debentures to be issued
in accordance with the method for allotting Debentures described in the
Prospectus.  See "The Rights Offering – Allocation Procedures if
Subscriptions Exceed Offering Size."  Excess subscription payments
will be returned to subscribers without interest.

       

      The
Rights will be evidenced by non-transferable Rights certificates (the "Rights
Certificates") and will cease to have any value at the close of business on the
Expiration Date.

       

      We are
asking persons who hold shares of Common Stock beneficially and who have
received the Rights distributable with respect to those shares through a broker,
dealer, commercial bank, trust company or other nominee, as well as persons who
hold certificates of Common Stock directly and prefer to have such institutions
effect transactions relating to the Rights on their behalf, to contact the
appropriate institution or nominee and request it to effect the transactions for
them.

       

      You will
be required to certify to the Subscription Agent (as defined below) and GABC the
number of Rights that have been exercised on behalf of each beneficial owner of
Rights pursuant to the Basic Subscription Privilege, whether the Basic
Subscription Privilege of each such beneficial owner of Rights on whose behalf
you are acting has been exercised in full, and the principal amounts of
Debentures being subscribed for pursuant to the Rounding-Up Privilege and the
Over-Subscription Privilege by each beneficial owner of Rights on whose behalf
you are acting.

       

      All fees
and other expenses, other than fees and expenses of the Subscription Agent,
incurred in connection with the exercise of the Rights will be for the account
of the holder of the Rights, and none of such fees or expenses will be paid by
GABC or the Subscription Agent.

       

      Enclosed
are copies of the following documents:

       

      1.           A
copy of the Prospectus;

      
      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                2.

              	
                A
      form of letter, including a beneficial owner election form, which may be
      sent to your clients for whose account you hold shares of Common Stock
      registered in your name or the name of your
  nominee;

              


      

      3.            
Notice of Guaranteed Delivery;

      
        	
                 
      

              	
                4.

              	
                A
      nominee holder certification that you must submit if you exercise the
      Rounding-Up Privilege or the Over-Subscription Privilege on behalf of
      beneficial holders of Rights.

              


      

      
        
        

      

       

      To
exercise Rights, you must properly complete and sign the Rights Certificate (or
the Notice of Guaranteed Delivery if you are following the Guaranteed Delivery
Procedures) and forward it, with payment of the Subscription Price in full for
all Debentures subscribed for pursuant to the Basic Subscription Privilege, the
Rounding-Up Privilege and the Over-Subscription Privilege, to the Subscription
Agent or notify the depositary (DTC) of your intent to subscribe through the
Agents Subscription Offer Program (ASOP). The Subscription Agent must receive
the Rights Certificate or Notice of Guaranteed Delivery with payment of the
Subscription Price, including final clearance of any checks, prior to 5:00 p.m.,
New York City time, on the Expiration Date. A Rights holder cannot revoke the
exercise of its Rights. Rights not exercised prior to the Expiration Date will
expire.

       

      


       

      Very
truly yours,

       

      GERMAN
AMERICAN BANCORP, INC.

       

      Additional
copies of the enclosed materials, as well as a separate beneficial owner
election form, may be obtained from:

       

      The
Information Agent for the Rights Offering is:

       

      

      
 

       

      NOTHING
IN THE PROSPECTUS OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY
PERSON AS AN AGENT OF GERMAN AMERICAN BANCORP, INC., THE SUBSCRIPTION AGENT OR
ANY OTHER PERSON, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENTS ON
BEHALF OF ANY OF THEM WITH RESPECT TO THE OFFERING EXCEPT FOR STATEMENTS MADE IN
THE PROSPECTUS.