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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN
PROXY STATEMENT
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
/X/ Definitive proxy statement
/ / Definitive additional materials
/X/ Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
Michigan National Corporation
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2)
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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:
(4) Proposed maximum aggregate value of transaction:
/ / 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 statement no.:
(3) Filing party:
(4) Date filed:
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
APRIL 19, 1994
AND PROXY STATEMENT
[LOGO]
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Notice of Annual Meeting of Stockholders
[LOGO]
To the Stockholders of
MICHIGAN NATIONAL CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of MICHIGAN
NATIONAL CORPORATION (the "Corporation") will be held at the offices of the
Corporation located at 27777 Inkster Road, Farmington Hills, Michigan 48334, on
Tuesday, April 19, 1994, at 10:00 A.M. for the purpose of:
(1) Electing fourteen directors for the Corporation to serve until the
next Annual Meeting of Stockholders and until their successors
have been duly elected and qualified.
(2) Transacting such other business as may properly come before the
meeting or any adjournment or adjournments thereof.
Stockholders of record at the close of business on February 22, 1994 are
entitled to notice of and to vote at the meeting.
You are cordially invited to attend the Annual Meeting in person.
Regardless of whether you expect to attend the meeting in person, the Board of
Directors urges you to sign, date and promptly return the enclosed Proxy in the
accompanying envelope.
A complete alphabetical list of stockholders entitled to vote at the
meeting, including their addresses and number of shares, will be open for
inspection by stockholders at the meeting, and for at least ten days prior to
the meeting, during regular business hours at the offices of the Corporation at
27777 Inkster Road, Farmington Hills, Michigan 48334.
By order of the Board of Directors,
LAWRENCE L. GLADCHUN
Secretary
Farmington Hills, Michigan
March 17, 1994
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IMPORTANT
EVEN IF YOU EXPECT TO ATTEND THE ANNUAL MEETING, WE ENCOURAGE YOU TO MARK,
SIGN, DATE, AND PROMPTLY RETURN THE ENCLOSED PROXY IN THE ENCLOSED
ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF YOU
ATTEND THE MEETING YOU MAY, AT YOUR DISCRETION, REVOKE THE PROXY AND VOTE
IN PERSON.
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Proxy Statement
[LOGO]
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Michigan National Corporation (the
"Corporation") to be used at the Annual Meeting of Stockholders of the
Corporation and any adjournment or adjournments thereof. The Annual Meeting will
be held on April 19, 1994 at the time and place and for the purposes set forth
in the accompanying Notice of Annual Meeting of Stockholders. This Proxy
Statement, Notice of Annual Meeting of Stockholders and Proxy Card are first
being provided to stockholders on or about March 17, 1994. Stockholders of the
Common Stock of the Corporation as of the close of business on February 22, 1994
will be entitled to be present and to vote at the meeting. On February 22, 1994,
there were 15,197,014 shares of Common Stock outstanding and entitled to vote.
The Corporation has no other class of stock issued and outstanding at this time
that is entitled to vote at the meeting.
The Board of Directors requests that you execute and return the Proxy
promptly, whether or not you plan to attend the meeting. The shares represented
by properly executed Proxies will be voted in accordance with the instructions
provided therein and, where no instructions are given, will be voted in favor of
the nominees for election as directors. Any Proxy may be revoked by the person
giving it at any time prior to it being exercised by giving written notice of
such revocation to the Secretary of the Corporation prior to the Annual Meeting,
or by the vote of the stockholder in person at the Annual Meeting.
The persons named in the Proxy to represent stockholders who are present by
proxy at the meeting are Robert J. Mylod, Chairman of the Board and Chief
Executive Officer of the Corporation and Lawrence L. Gladchun, Senior Vice
President, General Counsel and Secretary of the Corporation.
The Corporation will provide without charge to each beneficial owner of its
shares, upon such stockholder's written request, a copy (without exhibits) of
the Corporation's Annual Report on Form 10-K required to be filed with the
Securities and Exchange Commission for the year ended December 31, 1993.
Requests for copies should be addressed to: Lawrence L. Gladchun, Senior Vice
President, General Counsel and Secretary, Michigan National Corporation, 27777
Inkster Road, P.O. Box 9065, Farmington Hills, Michigan 48333-9065. The Annual
Report on Form 10-K is not part of the proxy solicitation materials.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The table below includes all the stockholders of the Corporation known by
the Corporation as beneficially owning more than five percent of its Common
Stock.
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
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COMMON
STOCK PERCENTAGE
BENEFICIALLY NATURE OF OF
OWNED AS BENEFICIAL OWNERSHIP OUTSTANDING
OF ---------------------------------------------- COMMON STOCK
FEBRUARY SOLE SHARED SOLE SHARED AS OF
NAME AND ADDRESS OF 22, VOTING VOTING INVESTMENT INVESTMENT FEBRUARY 22,
BENEFICIAL OWNER 1994 POWER POWER POWER POWER 1994
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Michigan National Corporation
Employee Stock Ownership Plan(1)
Michigan National Bank
Grand Rapids, Michigan..................... 1,247,080 -- 1,247,080 -- 1,247,080 8.21%
Michigan National Corporation
Deferred Compensation Plan and Trust(2)
Michigan National Bank
Grand Rapids, Michigan..................... 1,176,374 -- 1,176,374 -- 1,176,374 7.74%
Heine Securities Corporation(3)
51 John F. Kennedy Parkway
Short Hills, New Jersey 07078.............. 840,300 840,300 -- 840,300 -- 5.53%
Invesco PLC
11 Devonshire Square
London EC2M 4YR England.................... 781,500 -- 781,500 -- 781,500 5.14%
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(1) Trust shares are held for the benefit of the participants in the Michigan
National Corporation Employee Stock Ownership Plan ("Stock Ownership Plan")
and are voted by the Trustee - Michigan National Bank, Trust Department, 77
Monroe Center, P.O. Box 1707, Grand Rapids, MI 49501.
Participants have the right to direct the vote of all shares allocated to
their accounts in the Stock Ownership Plan whether vested or unvested.
Shares which are not allocated to the account of a particular participant,
and allocated shares for which timely and proper directions are not received
by the Trustee, will be voted by the Trustee in the same proportion as it
votes the shares as to which timely and proper directions are received.
Participants also have the right to respond to tender or exchange offers for
the Common Stock allocated to their accounts. Various officers of the
Corporation who are named or included as a group in the section entitled
"Security Ownership of Management" on page 3 are participants in the Stock
Ownership Plan.
(2) Plan shares are held for the benefit of the participants in the Michigan
National Corporation Deferred Compensation Plan ("Deferred Compensation
Plan"), and are voted by the Trustee - Michigan National Bank, Trust
Department, 77 Monroe Center, P.O. Box 1707, Grand Rapids, MI 49501.
The Deferred Compensation Plan participants have the right to direct the
vote of all shares allocated to their accounts in the Deferred Compensation
Plan whether vested or unvested. Allocated shares (and in some instances
certain unallocated shares) for which timely and proper directions are not
received by the Trustee will be voted by the Trustee in the same proportion
as it votes the shares as to which timely and proper directions are
received. Shares allocated to the Payroll Based Stock Option Plan
("PAYSOP"), an account in the Deferred Compensation Plan, will not be voted
at all unless timely and proper instructions are received by the Trustee. As
of February 22, 1994, the total number of shares allocated to such PAYSOP
account was 37,012. Participants must approve certain dispositions of the
Corporation's stock by the Trustee of the Deferred Compensation Plan.
Various officers of the Corporation who are named or included as a group in
the section entitled "Security Ownership of Management" are participants in
the Deferred Compensation Plan.
(3) Heine Securities Corporation ("HSC") is an investment advisor registered
with the Securities and Exchange Commission. One or more of its advisory
clients is the actual owner of the shares; however, pursuant to advisory
contracts with its clients, HSC has sole voting and investment discretion
with respect to such shares. HSC disclaims any economic interest in any of
the shares owned by its clients.
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SECURITY OWNERSHIP OF MANAGEMENT
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
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PERCENTAGE OF
COMMON NATURE OF OUTSTANDING
STOCK BENEFICIAL OWNERSHIP COMMON
BENEFICIALLY ---------------------------------------------- STOCK
OWNED AS OF SOLE SHARED SOLE SHARED AS OF
FEBRUARY 22, VOTING VOTING INVESTMENT INVESTMENT FEBRUARY 22,
NAME OF DIRECTOR/NOMINEE 1994 POWER POWER POWER POWER 1994(1)
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Daniel T. Carroll...................... 1,000 1,000 -- 1,000 -- .01%
John S. Carton......................... 7,835 4,720 3,115 4,720 3,115 .05%
Douglas E. Ebert....................... 100,200(2) 100,200 -- 100,200 -- .66%
Sidney E. Forbes....................... 30,000 30,000 -- 30,000 -- .20%
Sue L. Gin............................. 3,600 3,600 -- 3,600 -- .02%
Morton E. Harris....................... 38,452(3) 2,127 36,325 2,127 36,325 .25%
Gerald B. Mitchell..................... 2,882(4) 1,016 -- 1,016 1,866 .02%
Robert J. Mylod........................ 130,809(2) 127,979 2,830 127,979 2,830 .86%
William F. Pickard..................... 1,417 1,417 -- 1,417 -- .01%
Stanton Kinnie Smith, Jr............... 8,784(4) 6,277 1,000 6,277 2,507 .06%
Walter H. Teninga...................... 3,798 3,798 -- 3,798 -- .02%
Stephen A. Van Andel................... 100 -- 100 -- 100 .00%
Richard T. Walsh....................... 1,000 1,000 -- 1,000 -- .01%
James A. Williams...................... 11,841(5) 1,125 10,716 1,125 10,716 .08%
NAME OF EXECUTIVE OFFICER(6)
- ----------------------------
Eric D. Booth.......................... 21,184(2) 18,535 2,649 18,535 2,649 .14%
Lawrence L. Gladchun................... 36,729(2) 30,814 5,915 30,814 5,915 .24%
Charles W. Kight....................... 10,225(2) 8,357 1,868 8,357 1,868 .07%
Edward H. Sondker...................... 7,303(2) 6,700 603 6,700 603 .05%
ALL EXECUTIVE OFFICERS AND DIRECTORS AS
A GROUP (26 persons including those
named above)......................... 546,256(2) 441,298 101,585 440,898 104,958 3.53%
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(1) The calculation of each of the percentages shown in this column is based
upon the number of shares of Common Stock outstanding and entitled to vote
of 15,197,014 plus the number of stock options held by each of the persons
named in the table or, in the case of the officers and directors as a group,
the stock options held in the aggregate by the executive officers in the
group, which are exercisable within sixty days of the filing.
(2) The beneficial ownership of shares shown in this column include currently
exercisable options to purchase Common Stock of the Corporation and options
exercisable within sixty days of the filing, which were granted to various
individuals named in this table, or included in the group, pursuant to the
Corporation's Stock Option and Performance Incentive Plan. Currently
exercisable options, or options exercisable within sixty days of the filing,
include 31,666 shares for Robert J. Mylod, 100,000 shares for Douglas E.
Ebert, 14,000 shares for Eric D. Booth, 23,834 shares for Lawrence L.
Gladchun, 8,000 shares for Charles W. Kight, 6,000 shares for Edward H.
Sondker and 80,203 shares held by the other executive officers in the group
who are not named in the table.
The shares shown in this column also include shares allocated to the
individual accounts of the named persons and all officers and directors
included as a group in the table, which are held by the Deferred
Compensation Plan and the Stock Ownership Plan. Michigan National Bank, a
subsidiary of the Corporation, is the "Trustee" of the Plans. The stock
holdings of the Trustee are further described in the section entitled
"Security Ownership of Certain Beneficial Owners" on page 2.
Fully vested amounts accrued pursuant to the Deferred Compensation Plan
include 14 shares for Robert J. Mylod, 815 shares for Eric D. Booth, 3,408
shares for Lawrence L. Gladchun, 1,053 shares for Charles W. Kight, 182
shares for Edward H. Sondker and 23,546 shares held by the other executive
officers in the group who are not named in the table.
Fully vested amounts accrued pursuant to the Stock Ownership Plan include
2,816 shares for Robert J. Mylod, 1,834 shares for Eric D. Booth, 1,707
shares for Lawrence L. Gladchun, 815 shares for Charles W. Kight, 321 shares
for Edward H. Sondker, and 7,932 shares held by the other executive officers
in the group who are not named in the table.
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(3) Includes 36,325 shares held by Spectrum Associates of which Mr. Harris is
managing partner.
(4) Includes 1,866 shares acquired by Mr. Mitchell and 1,507 shares acquired by
Mr. Smith pursuant to their elections to defer fees into common stock
pursuant to the Deferred Compensation Plan for Directors of Michigan
National Corporation and Michigan National Bank.
(5) Includes 445 shares as to which Mr. Williams disclaims beneficial ownership.
(6) For security ownership of Robert J. Mylod, Chairman and Chief Executive
Officer, and Douglas E. Ebert, President and Chief Operating Officer, refer
to their entries above with the list of directors.
ELECTION OF DIRECTORS
The By-laws of the Corporation provide that there shall not be less than
two or more than twenty-five directors. Pursuant to the By-laws, the Board of
Directors has determined that fourteen directors shall constitute the
Corporation's Board of Directors. Management recommends that votes be cast for
the election of a total of fourteen directors from the nominees for directors
named below. The vote of a majority of the shares present in person or
represented by proxy at the Annual Meeting will be required for the election of
directors. Each stockholder will be entitled to one vote in person or by proxy
for each share of the Corporation's Common Stock held by the stockholder.
Proxies containing abstentions or broker non-votes will be counted as present
for purposes of determining a quorum but will not be counted as votes cast with
respect to the election of directors. Each elected director shall serve until
the next annual meeting or until a successor is elected and qualified.
It is intended that the shares represented by Proxies solicited by the
Board of Directors will, unless contrary instructions are given, be voted for
the nominees named below. If any nominee becomes unavailable or declines to
serve, which is not anticipated, the persons named in the Proxy may vote the
shares represented by them for any substitute nominee proposed by management.
Each person listed below has consented to being named as a nominee and has
indicated a willingness to serve as a director if elected.
PRINCIPAL OCCUPATION AND
DIRECTOR BUSINESS EXPERIENCE DURING
NOMINEE NAME AGE SINCE PAST 5 YEARS AND OTHER DIRECTORSHIPS(1)
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DANIEL T. CARROLL........ 68 1985 Chairman and President, The Carroll Group, Inc.
(management consulting firm); Director, A. M.
Castle and Co., AON Corporation, Comshare, Inc.,
Diebold Inc., Wolverine World Wide, Inc., American
Woodmark Corporation, UDC Homes, Inc., Woodhead
Industries, Inc., DeSoto, Inc. and Oshkosh Truck
Corporation.
JOHN S. CARTON........... 53 1989 Chairman, President and Chief Executive Officer,
Pineview Inc. (privately owned golf club);
Chairman, President and Chief Executive Officer,
Turfside Inc. (restaurant).
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PRINCIPAL OCCUPATION AND
DIRECTOR BUSINESS EXPERIENCE DURING
NOMINEE NAME AGE SINCE PAST 5 YEARS AND OTHER DIRECTORSHIPS(1)
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DOUGLAS E. EBERT......... 48 Dec. 1993 President and Chief Operating Officer, Michigan Na-
tional Corporation (since Dec. 13, 1993), Michigan
National Bank (since Dec. 13, 1993); President and
Chief Executive Officer, Lincoln Financial
Corporation (Mar. 1992-Feb. 1993), Southeast
Banking Corporation (Jan. 1991-Sept. 1991);
Chairman, President and Chief Executive Officer,
Southeast Bank, N.A. (Jan. 1991-Sept. 1991);
President and Chief Operating Officer, Southeast
Banking Corporation (July 1990-Jan. 1991),
Southeast Bank, N.A. (July 1990-Jan. 1991); Sector
Executive Vice President, Manufacturers Hanover
Corporation (April 1985-May 1990).
SIDNEY E. FORBES......... 57 1989 Partner, Forbes/Cohen Properties (developer and
owner of shopping malls and other commercial
properties).
SUE L. GIN............... 52 1989 Chairman and Chief Executive Officer, Flying Food
Fare, Inc. (provider of food service to airlines);
Partner, New Management, Ltd.; Director,
Commonwealth Edison and Georgetown University.
MORTON E. HARRIS......... 74 1985 Managing Partner, Spectrum Associates
(investments); Managing Partner, Harris Foundation.
GERALD B. MITCHELL....... 66 1979 Retired; Chairman, Dana Corporation (vehicular and
industrial parts) (until 1990); Chairman and Chief
Executive Officer, Dana Corporation (until 1989);
Director, George Weston LTD, Canada, Worthington
Industries, Westpoint Stevens and Eastman Chemical
Co.
ROBERT J. MYLOD.......... 54 1985 Chairman and Chief Executive Officer, Michigan Na-
tional Corporation, Michigan National Bank;
Chairman and Director, Independence One Bank of
California, FSB(2); Chief Executive Officer,
Independence One Bank of California, FSB(2) (until
Jan. 1991); Chairman, President and Director,
Lockwood Banc Group, Inc.(2) (since Jan. 1994);
Director, Federal Reserve Bank of Chicago-Detroit
Branch (1989-1991), CRI Insured Mortgage
Association, Inc. and CRI Liquidating REIT, Inc.
(1989-1991); Director at-large, VISA U.S.A., Inc.
WILLIAM F. PICKARD....... 53 1989 Chairman and Chief Executive Officer, Regal
Plastics Company (manufacturer of plastic parts for
automotive and other industries); Owner/operator,
multiple McDonald's restaurant franchises.
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PRINCIPAL OCCUPATION AND
DIRECTOR BUSINESS EXPERIENCE DURING
NOMINEE NAME AGE SINCE PAST 5 YEARS AND OTHER DIRECTORSHIPS(1)
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STANTON KINNIE SMITH, JR. 63 1985 Vice Chairman, CMS Energy Corporation (holding com-
pany for gas and electric power in Michigan ) (since
Dec. 1991); President and Director, CMS Energy Corpo-
ration (1988-1991); Director, CLARCOR, Inc.
WALTER H. TENINGA........ 66 1979 Retired; President and Chief Executive Officer,
American ClubStores, Inc. (retailing company)
(until Aug. 1993); Chairman and Director, Warehouse
Club, Inc. (until July 1991); Director, Solo Serve
Corporation, Great Lakes Real Estate Investment
Trust and Developers Diversified Realty
Corporation.
STEPHEN A. VAN ANDEL..... 38 -- Vice President and Chairman of Executive Committee,
Amway Corporation (manufacturer and distributor
through independent distributors of home, personal
care, nutrition and catalog products); Director,
Amway Asia Pacific.
RICHARD T. WALSH......... 58 1985 Consultant; President, Chief Executive Officer and
Director, Core Industries Inc (manufacturers of
electronic products, farm equipment, fluid control
and construction products) (until Mar. 1992);
President, Chief Operating Officer and Director,
Core Industries Inc (1986-1991).
JAMES A. WILLIAMS........ 52 1989 Chairman and President, Williams, Schaefer, Ruby &
Williams, P.C. (law firm); Director, Independence
One Investment Services, Corp.(2) (until Apr.
1993).
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(1) Each of the nominees, except for Stephen A. Van Andel, is also a Director of
Michigan National Bank, the Corporation's principal banking subsidiary.
(2) Independence One Bank of California, FSB (formerly Beverly Hills Business
Bank, FSB), Mission Viejo, CA; Independence One Investment Services, Corp.,
Farmington Hills, MI; and Lockwood Banc Group, Inc., Houston, TX are
wholly-owned subsidiaries of the Corporation.
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The By-laws provide that nominations for the election of directors may be
made by stockholders entitled to vote for the election of directors at any
annual or special meeting of stockholders at which directors are to be elected.
Nominations by stockholders shall be made by written notice, which shall set
forth (i) as to each individual nominated: (A) the name, date of birth, business
and residence address; (B) the business experience during the past five years,
including his or her principal occupations and employment during such period,
and such other information as may be sufficient to permit assessment of his or
her prior business experience; (C) whether the nominee is or has ever been at
any time a director, officer or owner of 5% or more of any class of capital
stock, partnership interests or other equity interest of any corporation,
partnership or other entity; (D) any directorships held by such nominee in any
company with a class of securities registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended, or subject to the requirements of
Section 15(d) of such Act or any company registered as an investment company
under the Investment Company Act of 1940,
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as amended; and (E) whether, in the last five years, such nominee has been
convicted in a criminal proceeding or has been subject to a judgment, order,
finding or decree of any federal, state or other governmental entity, concerning
any violation of federal, state or other law, or any proceeding in bankruptcy,
which conviction, order, finding, decree or proceeding may be material to an
evaluation of the ability or integrity of the nominee; and (ii) persons
submitting the nomination and any person acting in concert shall submit to the
Secretary of the Corporation: (A) the name and business address of such persons;
(B) the name and address of such person as they appear on the Corporation's
books (if they so appear); and (C) the class and number of shares of the
Corporation which are beneficially owned by such person. A written consent by
the nominee to be named in a proxy statement as a nominee as well as a statement
that such person will serve as a director if elected, signed by the nominee,
shall be filed with any notice.
Notice shall be delivered to the Secretary of the Corporation at the
principal executive offices of the Corporation 60 days or more before the date
of the stockholders meeting if such notice is to be submitted at an annual
stockholders meeting provided, however, that if such annual meeting is called to
be held before the second Tuesday of April or if such notice is to be submitted
at a special meeting of stockholders at which directors are to be elected, such
notice shall be delivered no later than the close of business on the 15th day
following the day on which notice of the date of the stockholders meeting was
given. If the presiding officer of the meeting in his discretion determines and
declares that a nomination was not made in accordance with the foregoing, such
nomination shall be disregarded.
EXECUTIVE OFFICERS OF THE CORPORATION
As a result of a reorganization announced on March 10, 1994, Messrs. Kight,
Tull and Zarnoch no longer serve in executive officer positions of the
Corporation. Any references in this Proxy Statement to any of these individuals
reflect information as of December 31, 1993.
NAME, PRINCIPAL POSITIONS AND OFFICES WITH THE CORPORATION, POSITION
BUSINESS EXPERIENCE, PRINCIPAL OCCUPATION AND EMPLOYMENT DURING PAST 5 YEARS AGE SINCE
- --------------------------------------------------------------------------------------------- --- -------------
MARC L. BELSKY, First Vice President, Planning and Analysis.................................. 38 1990
First Vice President, Michigan National Bank (since 1990)
Vice President, Michigan National Bank (since 1986)
Treasurer, MNC Leasing Company(1) (since 1990)
Treasurer, MNC Financial Services(2) (since 1990)
Treasurer, Independence One Investment Services Corp.(1) (1989-1990)
Chief Financial Officer and Treasurer, Independence One Capital Management Corporation(3)
(1989-1990)
ERIC D. BOOTH, Executive Vice President, Mortgage Banking.................................... 49 1985
Chairman, President and Chief Executive Officer, Independence One Mortgage Corporation(2)
(since Oct. 1993)
Executive Vice President, Michigan National Bank (since Mar. 1987)
Vice Chairman and Director, Independence One Bank of California, FSB(1) (Since Jan. 1989)
Chairman and Chief Executive Officer, Independence One Mortgage Corporation(2) (since 1990)
Chairman, President and Director, Lockwood Banc Group, Inc.(1) (Oct. 1991-Jan. 1994)
Chairman and Chief Executive Officer, Independence One Asset Management Corporation(1)
(since Aug. 1989)
Chairman and Director, Independence One Financial Services, Inc.(2) (since May 1990)
Director, First State Bank and Trust Company of Port Lavaca(1) (1990-Dec. 1993)
Director, Lockwood National Bank of Houston(4) (Nov. 1991-Jan. 1994)
Director, Independence One Mortgage Corporation(2) (since 1985)
Director, Independence One Life Insurance Company(1) (since May 1990)
Director, Independence One Holding Company(1) (since July 1992)
Director, Michigan National Corporation (until April 1989)
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NAME, PRINCIPAL POSITIONS AND OFFICES WITH THE CORPORATION, POSITION
BUSINESS EXPERIENCE, PRINCIPAL OCCUPATION AND EMPLOYMENT DURING PAST 5 YEARS AGE SINCE
- --------------------------------------------------------------------------------------------- --- -------------
DOUGLAS E. EBERT(5), President and Chief Operating Officer................................... 48 Dec. 13, 1993
LAWRENCE L. GLADCHUN, Senior Vice President, General Counsel and Secretary................... 43 1988
Executive Vice President, General Counsel and Secretary, Michigan National Bank
(since Nov. 1988)
Executive Vice President, Michigan National Bank (since Mar. 1987)
Director, Executive Relocation Corporation(2) (since Dec. 1990)
Director, Independence One Bank of California, FSB(1) (since Jan. 1989)
Director, Lockwood Banc Group, Inc.(1) (since Oct. 1991)
Director, Michigan National Bank (until Apr. 1989)
CHARLES W. KIGHT, Executive Vice President, Retail Banking and Information Technology........ 55 1991
Executive Vice President, Michigan National Bank (since Feb. 1990)
Senior Vice President, Michigan National Corporation (1989-1991)
Chairman and Director, Independence One Holding Company(1) (since July 1992)
Senior Vice President, Michigan National Bank (1989-Feb. 1990)
Senior Vice President, First Republic Bank Corporation, First Republic Bank and Republic
Bank (until 1989)
DAVID A. LIND, Senior Vice President, Retail Banking, Michigan Bankard Services.............. 45 1991
Senior Vice President, Michigan National Bank (since 1989)
First Vice President, Michigan National Corporation (1987-1991)
First Vice President, Michigan National Bank (1987-1989)
B. MATT MORRIS, III, Senior Vice President, Audit/Corporate Services......................... 50 1988
Senior Vice President, Michigan National Bank (since Mar. 1988)
First Vice President, Auditing (until Mar. 1988)
First Vice President, Michigan National Bank (until Mar. 1988)
ROBERT J. MYLOD, Chairman and Chief Executive Officer(5)..................................... 54 1985
ROBERT V. PANIZZI, First Vice President and Controller....................................... 42 1987
First Vice President, Michigan National Bank (since 1987)
First Vice President, Independence One Bank of California, FSB(1) (since 1990)
Director and Treasurer, Independence One Life Insurance Company(1) (since 1991)
WILLIAM D. RITSEMA, Senior Vice President, Credit Administration............................. 40 1990
Senior Vice President, Michigan National Bank (since May 1990)
First Vice President, Michigan National Corporation (1986-1990)
First Vice President, Michigan National Bank (1986-1990)
Director, General Audit Systems, Inc.(2) (since Sept. 1993)
EDWARD H. SONDKER, First Vice President...................................................... 46 1990
President, Chief Executive Officer, Independence One Bank of California, FSB(1) (since Nov.
1990)
President, Chief Executive Officer, LaJolla Bank and Trust Company (1985-1990)
Chairman and Chief Executive Officer, Independence One Asset Management Corporation(1)
(since Aug. 1991)
W. DAVID TULL, Executive Vice President and Treasurer, Investment Banking.................... 45 Oct. 1992
Executive Vice President, Michigan National Bank (since Feb. 1990)
Senior Vice President and Treasurer, Michigan National Corporation (1986-Oct. 1992)
Chairman, President and Director, Independence One Investment Services Corp.(1)
(since Mar. 1990)
Director, Independence One Capital Management Corporation(3) (since 1990)
Director, Independence One Brokerage Services, Inc.(2) (since 1988)
Chairman, Independence One Capital Management Corporation(3) (1990-1992)
Senior Vice President, Michigan National Bank (1987-1990)
RICHARD C. WEBB, Senior Vice President, Commercial Banking................................... 54 1986
Executive Vice President, Michigan National Bank (since Mar. 1987)
Chairman and Director, Executive Relocation Corporation(2) (since Dec. 1990)
Chairman and Director, MNC Leasing Company(1) (since Mar. 1990)
Chairman and Director, MNC Financial Services(2) (since Mar. 1990)
Director, MNC Operations and Services, Inc.(1) (since Dec. 1993)
Director, Michigan National Bank (until Apr. 1989)
Chairman, Southeast Region (1987-1990)
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NAME, PRINCIPAL POSITIONS AND OFFICES WITH THE CORPORATION, POSITION
BUSINESS EXPERIENCE, PRINCIPAL OCCUPATION AND EMPLOYMENT DURING PAST 5 YEARS AGE SINCE
- --------------------------------------------------------------------------------------------- --- -------------
JOSEPH J. WHITESIDE, Executive Vice President and Chief Financial Officer.................... 52 Mar. 8, 1994
Chief Financial Officer, Michigan National Bank (since March 8, 1994)
Managing Director and Principal, Cornerstone Capital Advisors, Ltd. (since 1993)
Executive Vice President and Chief Financial Officer, Equimark Corporation (1990-1993)
Executive Vice President, Bank of New England Corporation (until Dec. 1990)
DAVID M. ZARNOCH, Senior Vice President, Commercial Lending.................................. 45 May 1992
Senior Vice President, Michigan National Bank (since May 1992)
Director, MNC Financial Services, Inc.(2) (since Sept. 1993)
Director, MNC Leasing Company(1) (since Sept. 1993)
Executive Vice President, Ameritrust Company, N.A. (1991-1992)
Senior Vice President, Ameritrust Company, N.A. (1985-1990)
- -------------------------
(1) First State Bank and Trust Company of Port Lavaca, Port Lavaca, TX;
Independence One Asset Management Corporation, Irvine, CA; Independence One
Bank of California, FSB (formerly Beverly Hills Business Bank, FSB), Mission
Viejo, CA; Independence One Holding Company (formerly BancA Corporation),
Dallas, TX; Independence One Investment Services Corp., Farmington Hills,
MI; Independence One Life Insurance Company, Phoenix, AZ; Lockwood Banc
Group, Inc., Houston, TX; MNC Leasing Company, Detroit, MI; and MNC
Operations and Services, Inc., Farmington Hills, MI, are wholly-owned
subsidiaries of the Corporation.
(2) Executive Relocation Corporation, Farmington Hills, MI; General Audit
Systems, Inc., Farmington Hills, MI; Independence One Brokerage Services,
Inc., Farmington Hills, MI; Independence One Financial Services, Inc.,
Southfield, MI; Independence One Mortgage Corporation, Southfield, MI; and
MNC Financial Services, Detroit, MI are wholly-owned subsidiaries of
Michigan National Bank.
(3) Independence One Capital Management Corporation, Farmington Hills, MI, is a
wholly-owned subsidiary of Independence One Investment Services Corp.
(4) Lockwood National Bank of Houston, Houston, TX is a wholly-owned subsidiary
of Lockwood Banc Group, Inc.
(5) See the section entitled "Election of Directors" on page 4 for description
of principal positions and offices with the Corporation, business
experience, principal occupation and employment during past five years.
-------------------------
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors is composed of
independent outside directors. The Compensation Committee's responsibilities
include reviewing and approving recommendations from senior management and
making recommendations to the Board regarding the policies and procedures that
govern the various compensation programs for the Chief Executive Officer and
executives of Michigan National Corporation. This responsibility includes the
administration of the corporate executive salary program, the corporate bonus
plan, the deferred compensation plans, the corporate stock option and
performance incentive plan and all other plans that impact the Chief Executive
Officer's and the executive officers' total compensation.
Michigan National Corporation's executive compensation programs are
designed to attract, retain, motivate and reward highly talented executives who
are capable of developing and achieving strategic business objectives that will
allow the Corporation to remain highly competitive in a very complex and
demanding industry.
On an annual basis, the Compensation Committee conducts a review of the
Corporation's executive compensation programs. This review includes the
presentation of salary survey information compiled by the Corporation's Human
Resources Division. The Human Resources Division gathers survey data from
independent sources it concludes are reliable for positions which are comparable
to positions within the Corporation. This allows the Committee to evaluate
competitive base salaries, bonuses and total compensation in establishing the
compensation of the Corporation's executives. In 1993, data from three
independent surveys covering regional banks with assets from $6 Billion to $20
Billion and Michigan banks with assets of $5 Billion or more was utilized by the
Committee in
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formulating its base salary and bonus recommendations. If survey data was not
available with respect to a specific position, the Corporation's Human Resources
Division analyzed the components of the position and made a specific salary
recommendation to the Committee with respect to the position.
With respect to the 1993 base salary granted to the Corporation's Chief
Executive Officer, Robert J. Mylod, after reviewing the above described survey
data in the context of the Corporation's profitability, quality of its balance
sheet, results of internal and external audits and the position of the
Corporation in its markets, the Committee recommended a base salary of
$534,500(1). The average base salary for the chief executive officers covered by
the salary surveys utilized by the Committee was approximately $580,000.
Mr. Mylod and the other executives of the Corporation had the opportunity
to receive other performance-based incentives in the form of bonuses paid
pursuant to the corporate bonus program and stock option awards paid pursuant to
the Corporation's stock option incentive program. For 1993, the corporate bonus
program provided for the payment of bonuses based upon the achievement of
predetermined net income targets. A total of three net income targets were
established. If the Corporation's net income was below the base level net income
target, no bonuses would be paid. The bonus potential for the Chief Executive
Officer and other executives increased with the achievement of each successive
net income target up to a maximum of 80% of base salary for the Chief Executive
Officer and 45-60% of base salary for the other named executives. Under the
program, bonuses are paid 50% in cash and 50% in Michigan National Corporation
common stock. Fifty percent of the stock portion is deferred over a 2-year
period.
The base level net income target was not achieved in 1993 and therefore no
bonuses were paid under this program. However, Mr. Sondker, Chief Executive
Officer of Independence One Bank of California, FSB ("IOBC"), received a bonus
payment under the provisions of IOBC's Bonus Program. The bonus payment was
based principally on achievement of a predetermined pre-tax net income goal. Mr.
Gladchun, Senior Vice President, General Counsel and Secretary, was awarded a
discretionary bonus by the Compensation Committee based upon its evaluation of
his performance during 1993.
The Compensation Committee recommended and the Board of Directors has
approved a Corporate Bonus Program for 1994 which is similar to the 1993 Program
with two significant differences. First, the principal corporate performance
criteria is the Corporation's return on assets as opposed to net income. Four
return-on-asset targets have been established by the Committee and the Board.
Secondly, for executives other than the Chief Executive Officer and the
President and Chief Operating Officer, a portion of their bonus potential will
be based upon the achievement of predetermined performance objectives by the
business units for which the executives are responsible. Similar to the 1993
Program, no bonuses will be paid if the base level target is not achieved.
However, once the base level target is achieved, the executives' bonus potential
will increase by approximately 25% with the achievement of each successive
return-on-assets target up to a maximum of 80% of base salary for the Chief
Executive Officer and 45-70% of base salary for the other named executives.
In 1985, the Corporation's shareholders approved a stock option incentive
plan entitled the Michigan National Corporation Stock Option and Performance
Incentive Plan. Under the Plan, stock options are granted to officers by the
Board of Directors upon a recommendation by the Compensation Committee. The
stock options are intended to reward officers for diligent performance of their
responsibilities and their contributions to the Corporation and to provide
incentive for future
- ---------------
(1) This includes an increase in base salary of $4,500 as of December 30, 1993,
due to the elimination of an annual automobile allowance of $9,000, which
affected all officers of the Corporation with this benefit.
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performance by increasing their ownership interest in the Corporation.
Generally, stock options are granted with an exercise price equal to the market
value on the date of grant and are vested over a three-year period with a
ten-year term. In 1993, the Compensation Committee approved the granting of
stock options to, of the named executive officers, Messrs. Booth and Sondker.
On an annual basis, the Compensation Committee reviews the qualified
benefit plans under which the executive officers are covered participants. This
review includes an analysis of any recommended plan amendments and how those
amendments and/or the existing plan provisions impact the total deferred
compensation of the executive officers. The plans included in this review are
the Michigan National Corporation Employees' Pension Plan and Trust Agreement,
the Michigan National Corporation Deferred Compensation Plan and Trust, the
Michigan National Corporation Employee Stock Ownership Plan and the Michigan
National Corporation Stock Option and Performance Incentive Plan.
Stanton Kinnie Smith, Jr.,
Chairman
Gerald B. Mitchell
Walter H. Teninga
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PERFORMANCE GRAPH
Set forth below is a line-graph presentation comparing cumulative five-year
stockholder returns on the Corporation's Common Stock against the cumulative
total return of the NASDAQ Stock Market Index(1) and the Keefe, Bruyette & Woods
Bank Stock Index (KBW 50 Index)(2) for the five-year period commencing December
31, 1988 and ending December 31, 1993.(3)
KEEFE, BRUYETTE
MICHIGAN AND WOODS
NATIONAL BANK STOCK
Measurement Period CORPORATION NASDAQ STOCK INDEX (KBW
(Fiscal Year Covered) (MNCO) MARKET INDEX 50)
1988 100.00 100.00 100.00
1989 115.00 121.24 118.91
1990 41.52 102.96 85.40
1991 112.17 165.21 135.17
1992 144.40 192.11 172.23
1993 167.81 219.21 181.77
(1) The NASDAQ Stock Market Index, a broad market equity index, is made up of
both U.S. and foreign companies listed on the NASDAQ exchange.
(2) The KBW 50 Index, a market-capitalization-weighted index, is made up of
fifty of the nation's most important banking companies, including all
money-center and most regional banks.
(3) Total return includes reinvestment of dividends. All data is as of fiscal
year-end December 31.
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EXECUTIVE COMPENSATION
The following table provides summary information concerning compensation
paid or accrued by the Corporation and its subsidiaries, to or on behalf of the
Corporation's Chief Executive Officer and each of the four other most highly
compensated executive officers of the Corporation (determined as of December 31,
1993) for the fiscal years ended December 31, 1991, 1992 and 1993:
SUMMARY COMPENSATION TABLE
LONG TERM COMPENSATION
------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
- ------------------------------------------------------------------- -------------------- -------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
OTHER RESTRICTED
ANNUAL STOCK LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION AWARD(S) OPTIONS PAYOUTS COMPENSATION
POSITION YEAR ($) ($) ($) ($) (#) ($) ($)
- -------------------------- ---- ------- ------- ------------ ---------- ------- ------- ------------
ROBERT J. MYLOD........... 1993 529,259 -- -- -- -- -- 6,558(1)
Chairman and 1992 470,848 -- 665,803(2) -- -- -- 1,238,344(3)
Chief Executive 1991 459,320 -- N/A -- 7,000 -- N/A
Officer
ERIC D. BOOTH............. 1993 280,705 -- -- -- 1,000 -- 6,558(1)
Executive Vice 1992 241,305 -- 52,353(2) -- -- -- 94,600(3)
President 1991 223,211 -- N/A -- 5,000 -- N/A
CHARLES W. KIGHT(4)....... 1993 275,139 -- -- -- -- -- 6,558(1)
Executive Vice 1992 230,672 -- 119,831(2) -- -- -- 209,132(3)
President, Retail 1991 204,471 -- N/A -- 5,000 -- N/A
Banking and
Information Technology
EDWARD H. SONDKER......... 1993 224,177 113,250 -- -- 1,400 -- 6,558(1)
Chief Executive 1992 204,114 107,000 -- -- -- -- 5,714(3)
Officer of 1991 216,863 100,000 N/A -- 3,000 -- N/A
Independence One
Bank of California, FSB
LAWRENCE L. GLADCHUN...... 1993 189,540 75,000 -- -- -- -- 6,558(1)
Senior Vice 1992 175,610 -- -- -- -- -- 4,707(3)
President, 1991 168,780 -- N/A -- 2,000 -- N/A
General Counsel and
Secretary
- -------------------------
(1) The 1993 compensation figures in the All Other Compensation column are equal
to the annual contribution to the Employee Stock Ownership Plan ("ESOP") for
each executive.
(2) The 1992 compensation figures attributable to Messrs. Mylod, Booth and Kight
in the Other Annual Compensation column are equal to the tax gross up
provided to them as a consequence of the Corporation's purchase of single
premium annuities for them in 1992. For an explanation of the purchase, see
the section entitled "Pension Plans" on page 17.
(3) The 1992 compensation figures attributable to Messrs. Mylod, Booth and Kight
in the All Other Compensation column are equal to the premium expense of the
single premium annuities purchased for them in 1992 (see reference in
footnote #2) and the annual contribution to the Employee Stock Ownership
Plan ("ESOP") for each executive. For Mr. Mylod, the premium expense was
$1,232,630 and the ESOP contribution was $5,714. For Mr. Booth, the premium
expense was $88,886 and the ESOP contribution was $5,714. For Mr. Kight, the
premium expense was $203,418 and the ESOP contribution was $5,714. The 1992
entries in this column for Messrs. Sondker and Gladchun represent the annual
ESOP contributions for their accounts.
(4) Mr. Kight no longer serves in this capacity as a result of a reorganization
announced on March 10, 1994.
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STOCK OPTION GRANTS
The following table provides information, with respect to the named
executive officers, concerning the grant of stock options during the last fiscal
year.
OPTION GRANTS IN LAST FISCAL YEAR TABLE
INDIVIDUAL GRANTS
- ---------------------------------------------------------------------------------- POTENTIAL REALIZABLE ALTERNATIVE
(C) VALUE AT ASSUMED TO (F) AND
PERCENT ANNUAL RATES OF STOCK (G): GRANT
OF TOTAL PRICE APPRECIATION DATE VALUE
OPTIONS FOR OPTION TERM ----------
GRANTED (D) ---------------------
(B) TO EXERCISE (F)
OPTIONS EMPLOYEES OR BASE (E) (F) (G) GRANT DATE
(A) GRANTED IN FISCAL PRICE EXPIRATION 5% 10% PRESENT
NAME (#) YEAR(%) ($/SH) DATE ($)(1) ($)(1) VALUE($)
- --------------------------------- ------- --------- -------- ---------- -------- --------- ----------
ROBERT J. MYLOD.................. -- -- N/A N/A N/A N/A N/A
ERIC D. BOOTH.................... 1,000 0.5% $59.50 10/20/03 $37,485 $ 94,605 N/A
CHARLES W. KIGHT................. -- -- N/A N/A N/A N/A N/A
EDWARD H. SONDKER................ 1,400 0.7% 59.50 10/20/03 52,479 132,447 N/A
LAWRENCE L. GLADCHUN............. -- -- N/A N/A N/A N/A N/A
- -------------------------
(1) The 5% and 10% annual rates of stock price appreciation are hypothetical
assumptions, and such increases in the Corporation's stock price may not
actually occur.
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STOCK OPTION EXERCISES AND HOLDINGS
The following table provides information, with respect to the named
executive officers, concerning the exercise of stock options during the last
fiscal year and unexercised options held as of the end of the last fiscal year.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES TABLE
(a) (b) (c) (d) (e)
NUMBER OF VALUE OF UNEXERCISED
SHARES ACQUIRED VALUE UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
NAME ON EXERCISE (#) REALIZED ($) AT FY-END (#) AT FY-END ($)(1)
- ------------------------ --------------- ------------ ----------------------------- -----------------------------
ROBERT J. MYLOD......... -- -- Exercisable 31,666 Exercisable $ 356,487
Unexercisable 2,334 Unexercisable 45,513
ERIC D. BOOTH........... 23,001 $615,110 Exercisable 14,000 Exercisable 87,500
Unexercisable 2,666 Unexercisable 32,487
CHARLES W. KIGHT........ -- -- Exercisable 12,668 Exercisable 167,539
Unexercisable 1,666 Unexercisable 34,487
EDWARD H. SONDKER....... -- -- Exercisable 6,000 Exercisable 198,000
Unexercisable 2,400 Unexercisable 19,500
LAWRENCE L. GLADCHUN.... -- -- Exercisable 23,834 Exercisable 431,638
Unexercisable 666 Unexercisable 12,987
- -------------------------
(1) The closing price on 12/31/93 was $57.50 per share.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT ARRANGEMENTS
The Corporation has an employment agreement dated January 16, 1985, with
Robert J. Mylod, under which Mr. Mylod will serve as Chairman of the Board of
Directors and Chief Executive Officer of the Corporation. Under the contract,
Mr. Mylod's current salary as of December 31, 1993 is $534,500. The current term
of this agreement expires January 22, 1999. However, the agreement provides that
on January 22 of each year, the term of the agreement is automatically extended
for an additional year unless notice to the contrary is given by either party
before any scheduled extension is to occur. In addition to participation in all
standard employee benefit plans, Mr. Mylod is entitled to other benefits
afforded senior officers of the Corporation including participation in the
Corporation's Bonus Plans. If Mr. Mylod's employment as an officer is terminated
by the Corporation, he will continue to receive his salary and benefits for the
remaining term of the agreement. The agreement also provides for certain
benefits to be paid in the event of disability or death.
The Corporation has an employment agreement dated November 17, 1993 with
Douglas E. Ebert, under which Mr. Ebert will serve as President and Chief
Operating Officer of the Corporation. Under the contract, Mr. Ebert's current
salary as of December 31, 1993 is $450,000. The current term of this agreement
expires December 31, 1996. However, the agreement provides that at the end of
each of the first two years, the term can be extended for an additional year at
the discretion of the Board of Directors. Under the employment agreement, Mr.
Ebert was granted the option to purchase 100,000 shares of the Corporation's
Common Stock at $58.87 per share, with a ten year term. Mr. Ebert also received
a one-time lump sum hiring consideration payment of $75,000. In addition to
participation in
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all standard employee benefit plans, Mr. Ebert is entitled to other benefits
afforded senior officers of the Corporation including participation in the
Corporation's Bonus Plans. If Mr. Ebert's employment as an officer is terminated
by the Corporation, he will continue to receive his salary for the remaining
term of the agreement.
The Corporation has an employment agreement dated March 2, 1994 with Joseph
J. Whiteside, under which Mr. Whiteside will serve as Executive Vice President
and Chief Financial Officer of the Corporation. Under the contract, Mr.
Whiteside's current salary is $275,000. The current term of this agreement
expires March 2, 1997. However, the agreement provides that at the end of each
of the first two years, the term can be extended for an additional year at the
discretion of the Board of Directors. Under the employment agreement, Mr.
Whiteside was granted the option to purchase 25,000 shares of the Corporation's
Common Stock at $64.375 per share, with a ten year term. Mr. Whiteside also
received a one-time lump sum hiring consideration payment of $35,000. In
addition to participation in all standard employee benefit plans, Mr. Whiteside
is entitled to other benefits afforded senior officers of the Corporation
including participation in the Corporation's Bonus Plans. If Mr. Whiteside's
employment as an officer is terminated by the Corporation, he will continue to
receive his salary for the remaining term of the agreement.
In September 1989, the Corporation entered into executive change in control
severance agreements with current executive officers of the Corporation
including, of the named executive officers, Messrs. Mylod, Booth, Kight, and
Gladchun, and the Corporation entered into the same agreement with Mr. Ebert in
February 1994 and with Mr. Whiteside in March 1994, in order to reinforce and
encourage the continued dedication and attention of those executives as members
of the Corporation's management without distractions in potentially disturbing
circumstances arising from the possibility of a change in control of the
Corporation. These agreements are operative upon the occurrence of a "change in
control" of the Corporation, which would be deemed to occur (a) upon any person
or group of persons other than the Corporation, its subsidiaries or employee
benefit plans acquiring the beneficial ownership of 20% or more of the combined
voting power of the Corporation's then outstanding voting securities; or (b) if
during any two year period during the term of the agreement, individuals who at
the beginning of such period constitute the Corporation's Board of Directors,
cease for any reason to constitute at least a majority thereof; or (c) upon a
merger, consolidation or any sale, lease, exchange or other transfer of all or
substantially all of the assets of the Corporation, or any other similar
business combination or transaction other than any business combination or
transaction which (i) would result in the outstanding voting securities of the
Corporation immediately prior thereto continuing to represent (either by
remaining outstanding or being converted into voting securities of the surviving
entity) more than 75% of the combined voting securities immediately after such
business combination or transaction or (ii) would be effected to implement a
recapitalization of the Corporation in which no person or group of persons
acquires 20% or more of the combined voting power of the outstanding voting
securities of the Corporation; or (d) upon the adoption of any plan or proposal
for the liquidation or dissolution of the Corporation; or (e) upon the
occurrence of any other event that requires reporting in response to Item 6(e)
of Schedule 14A of Regulation 14A of the Securities Exchange Act of 1934.
Each agreement provides that, in the event of certain terminations of the
executive's employment with the Corporation within two years of a change of
control of the Corporation, the executive will be entitled to receive the
following severance benefits: (1) a lump-sum payment equal to three times the
greater of (i) the executive's annual salary in effect at the time of the notice
of termination; or (ii) the
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executive's average salary based on the previous 5 calendar years; (2) a
lump-sum payment equal to (i) two times the highest annual bonus paid during the
prior 5 calendar years plus (ii) a pro rata portion of any bonus the executive
shall be deemed to have earned for the year termination occurred; (3) Mr. Mylod
and Mr. Booth will be treated as being 100% vested in their Supplemental Pension
Agreements described on pages 17-18; (4) all other executives will receive, in
addition to their vested benefits under the Pension Plan, a supplemental cash
benefit equal to the excess of (i) benefits payable under the Pension Plan if
the executive continued to be employed for the remainder of the period under
this agreement over (ii) the benefits actually payable under any such plan in
addition to their fully vested benefits; (5) a payment of $10,000 for
outplacement services; (6) an office, secretary and automobile for two years and
(7) the continuation of equivalent life, health, hospitalization, disability and
other similar benefits that the executive would have received prior to
termination for the remainder of the period under this agreement. Benefits under
this agreement, to the extent that they conflict therewith, are paid in lieu of
benefits provided under any employment or severance agreement or other
arrangement with the executive.
Under the agreement, the executive is not required to mitigate the amount
of payments by seeking employment or otherwise; nor shall the amount of any
benefit be reduced by any compensation or benefit earned by the executive after
termination. In addition, if an executive becomes subject to an excise tax under
the Internal Revenue Code as a result of any payments or benefits received on a
change in control, the Corporation will make an additional payment to the
executive to make him whole after payment of the excise tax and any income taxes
on the additional payment.
The agreement is inoperative when the termination of the executive is made
(i) by the Corporation due to death, permanent disability or cause, or (ii) by
the executive for other than "good reason". "Good reason" is broadly defined in
the agreements to include any significant adverse alteration in duties or
responsibilities of the executive, any reduction in compensation or benefits or
involuntary relocation. The agreements terminate five (5) years from the date of
their execution; however, the term is automatically extended for an additional
year on each anniversary of the execution date unless, prior to such anniversary
date, the executive is notified to the contrary in writing.
PENSION PLANS
The Corporation also has a Supplemental Pension Agreement ("Pension
Agreement") dated January 16, 1985 with Mr. Mylod, under which he will be
entitled to an annual contractual pension benefit equal to the vested portion of
60% of his average annual total compensation (salary plus bonus) for the 36
consecutive months his total compensation was the highest, less (i) the annual
amount of any benefits he is then entitled to receive under the Corporation's
Pension Plan, (ii) the annual amount of any benefits he is entitled to receive
under Social Security, and (iii) the pre-tax equivalent of any annual benefits
due him under any single premium deferred annuity contracts purchased by the
Corporation on his behalf. Under the vesting schedule of the Pension Agreement,
Mr. Mylod is currently 90% vested. He will be fully vested next year. Mr. Mylod
will first be eligible to receive pension benefits at age 55, but such payment
will be reduced by 2% for each year that the commencement of payments precedes
his attainment of age 60.
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If Mr. Mylod retires at age 60 with average annual total compensation of
$714,428 and 15 years of service, his estimated annual contractual benefit under
the Pension Agreement would be $357,083. In combination with the qualified
pension plan and social security, his total estimated annual pension benefits
would be $428,657. Pension benefits are paid for Mr. Mylod's life and then to
his surviving spouse for life. If Mr. Mylod dies before receiving his benefit,
his surviving spouse will receive his lifetime monthly benefit beginning at age
55.
The Corporation also has entered into Pension Agreements with, of the other
named executive officers, Eric D. Booth (dated October 22, 1987, amended
November 7, 1988, August 1, 1989, May 29, 1992 and February 26, 1993), Charles
W. Kight (dated November 7, 1990 and amended January 1, 1991 and March 12, 1993)
and Lawrence L. Gladchun (dated March 3, 1992 and amended March 4, 1993). The
Pension Agreements entitle each executive officer to an annual contractual
pension benefit equal to the vested portion of a contractual benefit less (i)
the annual amount of any benefits each is entitled to receive under the
Corporation's Pension Plan, (ii) the annual amount of any benefit each is
entitled to receive under Social Security, and (iii) the pre-tax equivalent of
any annual benefits due him under any single premium deferred annuity contracts
purchased by the Corporation on his behalf. The contractual benefit for each of
the above individuals is as follows: Mr. Booth ($200,000), Mr. Kight ($150,000)
and Mr. Gladchun ($100,000). These Pension Agreements provide for 10% vesting in
the plan benefits after each year of service under the plans, until they are
100% vested after 10 years of service. Mr. Booth is presently 90% vested; Mr.
Kight is 50% vested; and Mr. Gladchun is 30% vested. All of these plans will
become 100% vested in the event of a change in control of the Corporation.
Messrs. Booth and Gladchun will be eligible to receive pension benefits at
age 55, but such payments will be reduced by 2% for each year that the
commencement of payments precedes their attainment of age 60. Assuming that they
retire at age 60, at current compensation levels, the estimated annual
contractual benefit under their Pension Agreements would be $200,000 and
$100,000, respectively, reduced by other benefits as noted above. Mr. Kight will
be eligible to receive pension benefits at age 60. Assuming Mr. Kight retires at
age 60 (the age at which he will become fully vested), his estimated annual
contractual benefit will be $150,000, reduced by other benefits as noted above.
Generally, the pensions will be paid monthly for each executive officer's life,
and then to his surviving spouse for life. If the executive officer dies before
receiving his benefit, his surviving spouse will receive his lifetime monthly
benefit beginning at or after age 55 or 60, whichever is applicable.
The Corporation also has entered into a Supplemental Pension Agreement
("Pension Agreement") with Douglas E. Ebert, dated January 10, 1994, under which
he will be entitled to an annual contractual pension benefit equal to the vested
portion of 50% of his average annual total compensation (salary plus bonus) for
the three years his total compensation was the highest, less (i) the annual
amount of any benefits he is then entitled to receive under the Corporation's
Pension Plan, (ii) the annual amount of any benefits he is entitled to receive
under Social Security, and (iii) the pre-tax equivalent of any annual benefits
due him under any single premium deferred annuity contracts purchased by the
Corporation on his behalf. Under the vesting schedule of the Pension Agreement,
Mr. Ebert is currently 0% vested. His vested interest will increase to 30% at
the end of the third year and will increase by an additional 10% each year
thereafter through year ten until he is 100% vested. Mr. Ebert will first be
eligible to receive pension benefits at age 58, but such payment will be reduced
by 2% for each year that the commencement of payments precedes his attainment of
age 60.
The Corporation also has entered into a Supplemental Pension Agreement
("Pension Agreement") with Joseph J. Whiteside in March 1994, under which he
will be entitled to an annual
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contractual pension benefit equal to the vested portion of 40% of his average
annual total compensation (salary plus bonus) for the three years his total
compensation was the highest, less (i) the annual amount of any benefits he is
then entitled to receive under the Corporation's Pension Plan, (ii) the annual
amount of any benefits he is entitled to receive under Social Security, and
(iii) the pre-tax equivalent of any annual benefits due him under any single
premium deferred annuity contracts purchased by the Corporation on his behalf.
Under the vesting schedule of the Pension Agreement, Mr. Whiteside is currently
0% vested. His vested interest will increase to 30% at the end of the third year
and will increase by an additional 10% each year thereafter through year ten
until he is 100% vested. Mr. Whiteside will first be eligible to receive pension
benefits at age 62.
Effective in 1992, the Board of Directors authorized amendments to all of
the Pension Agreements to allow for purchases of individual non-participating
non-qualified deferred annuities to fund a portion of the Corporation's
obligations under the Pension Agreements. The annuities so purchased are owned
by the executive officer. Under the amendments, the maximum amount of benefits
which may be annuitized at any time equals the lesser of the vested accrued
benefit at the purchase date payable at age 65, or the projected vested accrued
benefit payable at age 65, assuming service continues to age 65 and that
compensation (for purposes of calculating various benefit offsets to the
supplemental pension or the target benefits) increases at 5% per year. (In Mr.
Mylod's case, the maximum amount of benefits which may be annuitized at any time
equals the vested accrued benefit as of the purchase date, payable at age 65.)
Under the amendments, the benefits due under the Pension Agreements are offset
by the pre-tax equivalent of any annuity purchased. The form of payment and
death benefits under the annuity policies generally mirror those payable under
the Pension Agreements. Under the amendments, annuity policies may be purchased
from time to time in the future.
The benefits purchased under the annuity policies will always be less than
what the Corporation would have otherwise paid, because, unlike supplemental
retirement benefits paid directly by the Corporation, payments under the annuity
policies will not be fully taxable to the executive officer upon receipt. Thus,
the annuities purchased reflect the after-tax equivalent of benefits which would
otherwise be paid by the Corporation on a pre-tax basis.
The purchase of annuity policies by the Corporation constitutes taxable
income to the executive officer in the year of the purchase. The Corporation
paid the federal and state taxes resulting both from the purchases and such tax
payments.
The table below sets forth for each executive officer the pre-tax annuity
purchased, its purchase price, and the Corporation's resulting payment of taxes
on behalf of the executive officer:
PRE-TAX ANNUITY
PURCHASED PAYABLE PURCHASE TAX
EMPLOYEE AT AGE 65(1) PRICE(2) PAYMENTS(3)
- -------- ----------------- ---------- ------------
MR. MYLOD........................................... $288,900/year $1,232,630 $665,803
MR. BOOTH........................................... 28,030/year 88,886 52,353
MR. KIGHT........................................... 45,922/year 203,418 119,831
- -------------------------
(1) Included in total pre-tax pension benefits or in fixed dollar pension
benefits disclosed for the executives.
(2) Included in the 1992 entries in column (i) of the Summary Compensation Table
on page 13.
(3) Included in the 1992 entries in column (e) of the Summary Compensation Table
on page 13.
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COMMITTEES AND ATTENDANCE
In 1993, the Corporation had a standing Audit and Credit Committee of the
Board of Directors comprised of seven directors, all of whom were not employees
of the Corporation or its subsidiaries: Richard T. Walsh (Chairman), Daniel T.
Carroll, John S. Carton, Sidney E. Forbes, Sue L. Gin, Morton E. Harris (until
April 1993) and William F. Pickard. The functions generally performed by the
Audit and Credit Committee included reviewing all internal and external audit
activities, reviewing ethics activities, reviewing credit administration
activities, reviewing regulatory authority activities and advising the Board of
Directors and management on broad issues related to these various areas. The
duties of the Audit and Credit Committee generally included: (1) reviewing the
scope and effectiveness of the Corporation's procedures for internal auditing
and loan review and the results thereof; (2) overseeing the Internal Audit
Department of the Corporation and reviewing with Management the appointment
and/or termination of the Director of Internal Audit; (3) overseeing the Loan
Review Function and reviewing with management the appointment and/or termination
of the Manager of Loan Review; (4) overseeing the Audit and Credit Committees of
the Corporation's subsidiary depository institutions; (5) reviewing the
qualifications, independence and fees of the external auditors and making
recommendations to the Board of Directors regarding the selection and/or
termination of the external auditors of the Corporation; (6) reviewing the scope
of the auditing engagement of the external auditors, significant accounting
policy changes and audit conclusions regarding significant accounting estimates
with management and resolving any significant disagreements between the external
auditors and/or internal auditors and Management; (7) reviewing the consolidated
financial statements of the Corporation and any significant adjustments thereto
proposed by the external auditors; (8) reviewing procedures used to determine
and test the adequacy of the allowance for possible credit losses; (9) reviewing
all management reports required to be prepared pursuant to Section 112 of the
Federal Deposit Insurance Corporation Improvement Act ("FDICIA") and the basis
for such reports; (10) reviewing the adequacy and effectiveness of the internal
control structure and procedures for financial reporting, and the resolution of
any identified material weaknesses and reportable conditions in internal
controls; (11) reviewing the "management letter" prepared by the external
auditors and approval of Management's responses thereto; (12) reviewing
examination reports made by regulatory agencies and approval of Management's
responses thereto; (13) reviewing significant regulatory developments and/or
accounting or reporting changes issued by the Financial Accounting Standards
Board or the Securities and Exchange Commission bearing on annual financial
reporting requirements; (14) reviewing the Code of Ethics regarding business
conduct for the Corporation; and (15) reviewing ethics related reports. The
Audit and Credit Committee held six meetings in 1993.
In 1993, the Corporation had a Compensation Committee of the Board of
Directors comprised of three directors, all of whom were not employees of the
Corporation or its subsidiaries: Stanton Kinnie Smith, Jr. (Chairman), Gerald B.
Mitchell and Walter H. Teninga. In 1993, the Compensation Committee received
recommendations from senior management and made recommendations to the Board of
Directors on: (1) the total compensation and benefits of the five highest paid
executive officers of the Corporation and of certain other officers; (2) the
employee benefit programs; (3) the annual bonus plans; (3) the stock option
programs; and (4) the employee stock purchase programs. The Compensation
Committee held four meetings in 1993.
20
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In 1993, the Corporation also had a Nominating Committee of the Board of
Directors comprised of four directors, all of whom were not employees of the
Corporation or its subsidiaries: Gerald B. Mitchell (Chairman), Stanton Kinnie
Smith, Jr., Walter H. Teninga, and James A. Williams. In 1993, the Committee
made recommendations to the Board of Directors on: (1) the nominees to the Board
for election by stockholders; (2) the membership of the various committees of
the Board; and (3) the compensation, benefits and business liability insurance
of outside directors. The Nominating Committee did not meet in 1993, but met on
February 23, 1994 to address the current nominees.
In 1993, the Corporation also had an Investment Committee of the Board of
Directors comprised of three directors, a majority of whom were not employees of
the Corporation or its subsidiaries: Morton E. Harris (Chairman), Robert J.
Mylod and James A. Williams. In 1993, the Investment Committee reviewed the
Corporation's investment activities on a periodic basis and monitored investment
activities for conformance with the Board's established investment policies. The
Investment Committee held three meetings in 1993.
There were a total of eleven regular meetings of the Board of Directors in
1993. All incumbent directors attended at least 75% of the meetings of the Board
of Directors and the various committees of which they were members.
DIRECTOR COMPENSATION
In 1993, the Board of Directors met on eleven separate occasions. Outside
directors of the Corporation received $13,500 as a retainer for their services.
For their attendance at each board meeting, outside directors received $900. The
retainer and board meeting fees include fees paid to outside directors for their
service on the Board of Michigan National Bank. All outside directors who served
on a committee were paid $500 for their attendance at each committee meeting,
which was increased to $800 in April 1993. The Chairman of the various board
committees received an additional retainer of $3,000. These fees paid to outside
directors will remain the same in 1994, except that beginning in April 1994, all
outside directors who serve on the Audit and Credit Committee will be paid
$2,000 for their attendance at each committee meeting, and the retainer for the
Chairman of the Audit and Credit Committee will increase to $5,000.
The directors of the Corporation may elect to participate in the
Corporation's Deferred Compensation Plan for Directors ("the Plan"). Under the
terms of the Plan, outside directors have the option to defer all or a portion
of their retainer or fees for services as a member of the board or any
committee, in cash or the equivalent in Michigan National Corporation stock.
Deferred fees are credited to a deferred compensation account maintained by the
Corporation for each director. Payments may be made in any year following the
year in which they are earned or upon resignation, death or disability.
All direct expenses incurred by outside directors to attend meetings are
reimbursed by the Corporation. Directors and committee members of the
Corporation or any of its subsidiaries, who are officers of the Corporation or
any of its subsidiaries, do not receive director or committee fees in addition
to their salaries.
21
25
CERTAIN TRANSACTIONS
Directors and executive officers of the Corporation, certain beneficial
owners of over 5% of the Corporation's Common Stock and members of their
immediate families were customers of, and had transactions (including loans and
loan commitments) with the Corporation and its subsidiaries during 1993. In the
opinion of management, all such loan transactions were made in the ordinary
course of business, on substantially the same terms, including interest rates
and collateral, as those prevailing at the time for comparable transactions with
other persons not affiliated with the Corporation or its subsidiaries, and did
not involve more than the normal risk of collectibility or present other
unfavorable features.
During 1993, FCN Associates, a general partnership, received lease payments
totalling $1,825,822 under a lease with a subsidiary of Michigan National Bank
for offices in the Galleria Officentre in Southfield, Michigan. Sidney E.
Forbes, a director of the Corporation, is a 50% owner of Forbes-Cohen
Properties, a general partnership, which owns 46% of Forbes-Cohen Family Limited
Partnership, which owns 66 2/3% of FCN Associates.
During 1993, Amway Hotel Corporation ("Amway Hotel") received lease
payments totalling $76,271 under a lease of a banking facility in the Amway
Plaza Hotel, Grand Rapids, Michigan, to a subsidiary bank of the Corporation.
Amway Hotel is a wholly-owned subsidiary of Amway Properties Corporation, which
is a wholly-owned subsidiary of Amway Corporation. Stephen A. Van Andel, a
director nominee of the Corporation, is Vice President and Chairman of the
Executive Committee of Amway Corporation.
James A. Williams, a director of the Corporation, is a managing partner of
the law firm Williams, Schaefer, Ruby and Williams, P.C., to which $95,864 were
paid for legal services in 1993.
EXCHANGE ACT, SECTION 16(A) COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors and officers, and persons who own more than ten percent
of a registered class of the Corporation's equity securities to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
("Commission") and the National Association of Securities Dealers. Specific due
dates for these reports have been established and the Corporation is required to
report in this proxy statement any failure to file by these dates during 1993.
All of these filing requirements were satisfied by its officers and directors
except that David M. Zarnoch, Senior Vice President, failed to file on a timely
basis one required report relating to one transaction involving Common Stock of
the Corporation. In making this statement, the Corporation has relied on the
written representations of its incumbent directors and officers and copies of
the reports that they have filed with the Commission.
OTHER MATTERS
The Board of Directors is not aware of any other matters which may come
before the meeting. However, should any such matters properly come before the
meeting, it is the intention of the persons named in the accompanying Proxy to
vote in accordance with their judgment on such matters.
The Corporation's independent public accounting firm is Deloitte & Touche.
In 1993, Deloitte & Touche performed audit and audit-related services for the
Corporation which included an examination
22
26
of the consolidated financial statements of the Corporation, and consultation
with the Corporation on accounting and reporting matters. Deloitte & Touche also
provided non-audit professional services. A representative of Deloitte & Touche
will be available at the Annual Meeting to respond to appropriate stockholder
questions and will have an opportunity to make a statement.
All costs incurred in connection with the solicitation of Proxies,
including the preparation and mailing of related materials, will be paid by the
Corporation. The solicitation of Proxies will be made primarily by mail. In
addition, Proxies may be solicited personally, by telephone or similar means by
the Corporation or its agents, and the Corporation may pay persons holding
Common Stock of the Corporation in their name, or those of their nominees, for
their expenses in sending soliciting materials to their principals. Morrow &
Company has been retained to assist the Corporation in the solicitation for a
fee of approximately $7,500 plus expenses, and First Chicago Trust Company of
New York has been retained to tabulate and prepare the Proxies at a fee
estimated to be approximately $10,000 plus expenses. Proposals of stockholders
intended to be presented at the 1995 Annual Meeting of Stockholders of the
Corporation, and included in the Corporation's proxy statement relating to that
meeting, must be received by the Corporation at the principal executive offices
of the Corporation at 27777 Inkster Road, P.O. Box 9065, Farmington Hills,
Michigan 48333-9065, not later than November 17, 1994.
Michigan National Corporation
LAWRENCE L. GLADCHUN
Secretary
Farmington Hills, Michigan
March 17, 1994
23
27
- --------------------------------------------------------------------------------
MICHIGAN NATIONAL CORPORATION
P 27777 INKSTER ROAD
FARMINGTON HILLS, MI 48334
R
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
O
The undersigned hereby appoints Robert J. Mylod and Lawrence L.
X Gladchun as proxies, each with the power to appoint his substitute,
and hereby authorizes them to represent and vote as designated
Y hereon, all the shares of the common stock of the Corporation which
the undersigned would be entitled to vote if personally present at
the Annual Meeting to be held on Tuesday, April 19, 1994, or at any
adjournment or adjournments thereof. In their discretion, the
Proxies are authorized to vote upon such other business as may
properly come before the meeting.
---------
SEE
REVERSE
SIDE
---------
(Continued and to be signed on the reverse side)
- --------------------------------------------------------------------------------
COMMON STOCKHOLDERS CARD
28
- --------------------------------------------------------------------------------
3630
- --------------------------------------------------------------------------------
-------- PLEASE MARK YOUR
X VOTES AS IN THIS
EXAMPLE.
------
FOR ALL NOMINEES (EXCEPT AS WITHHOLD AUTHORITY TO
Election of INDICATED TO THE CONTRARY). VOTE FOR ALL NOMINEES. NOMINEES: Daniel T. Carroll, John S. Carton, Douglas E.
Directors Ebert, Sidney E. Forbes, Sue L. Gin, Morton
/ / / / E. Harris, Gerald B. Mitchell, Robert J.
Mylod, William F. Pickard, Stanton Kinnie
Smith, Jr., Walter H. Teninga, Stephen A. Van
Andel, Richard T. Walsh, and James A. Williams.
To withhold authority to vote for any nominee, write that nominee's name on
the space provided below.
- --------------------------------------------------------------------------- THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE
VOTED AS INSTRUCTED HEREIN BY THE UNDERSIGNED
STOCKHOLDER. IF NO INSTRUCTIONS ARE GIVEN, THIS
PROXY WILL BE VOTED FOR ALL OF THE NOMINEES
LISTED ABOVE.
Please sign exactly as name appears on this
Proxy. When shares are held by joint tenants,
both should sign. When signing as attorney,
executor, administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full corporate
name by an authorized officer. If a
partnership, please sign in partnership name
by an authorized person.
PLEASE SIGN AND RETURN THIS PROXY PROMPTLY
USING THE ENCLOSED ENVELOPE.
--------------------------------, 1994
Signature Date
--------------------------------, 1994
Signature (if held jointly) Date
- --------------------------------------------------------------------------------
COMMON STOCKHOLDERS CARD
29
- --------------------------------------------------------------------------------
CONFIDENTIAL VOTING INSTRUCTION CARD
MICHIGAN NATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
DEFERRED COMPENSATION PLAN AND TRUST
DEFERRED COMPENSATION PLAN AND TRUST (PAYSOP)
The Board of Directors of Michigan National Corporation (the
"Corporation") has proposed one matter for consideration by
stockholders at its Annual Meeting of Stockholders scheduled for
April 19, 1994. This matter is described hereon and in the
Corporation's Proxy Statement. As a participant in the Michigan
National Corporation Employee Stock Ownership Plan and Trust and/or
the Michigan National Corporation Deferred Compensation
Plan and Trust and/or the Michigan National Corporation Deferred
Compensation Plan and Trust (PAYSOP subaccount) (the "Plans"), you
have the right to instruct the Trustee of the Plan(s) on how to
vote the Corporation's stock allocated for voting purposes to your
account(s) in the Plan(s) ("Allocated Shares"). If you wish to
direct the voting of your Allocated Shares in favor of (FOR) the
matter proposed, date and sign this Confidential Voting Instruction
Card and return it as instructed. However, if you wish to
individually direct the voting of your Allocated Shares on the
matter proposed, complete, date and sign this Confidential Voting
Instruction Card and return it as instructed. If you do not direct
the voting of your Allocated Shares in the Employee Stock Ownership
Plan and Trust and/or the Deferred Compensation Plan and Trust, they
will be voted in the same proportion as other shares of the
Corporation's stock held by each respective Plan for which timely
and proper voting instructions are received from participants. If
you do not direct the voting of your PAYSOP Allocated Shares, they
will not be voted. Therefore, it is important that you complete this
Confidential Voting Instruction Card and return it PROMPTLY in the
enclosed envelope. FIRST CHICAGO TRUST COMPANY OF NEW YORK WILL
RECEIVE AND MAINTAIN YOUR INDIVIDUAL VOTING INSTRUCTIONS IN
CONFIDENCE AND HAS BEEN INSTRUCTED ONLY TO REPORT TO THE TRUSTEE THE
CUMULATIVE RESULTS OF ALL VOTING INSTRUCTIONS RECEIVED FOR EACH PLAN.
The Trustee will vote the Corporation's stock held by each Plan in
accordance with the cumulative voting instructions of all
participants in each Plan, as above described.
---------
SEE
REVERSE
SIDE
---------
(Continued and to be signed on the reverse side)
- --------------------------------------------------------------------------------
EMPLOYEE
30
- --------------------------------------------------------------------------------
0472
- --------------------------------------------------------------------------------
-------- PLEASE MARK YOUR
X VOTES AS IN THIS
EXAMPLE.
------
FOR ALL NOMINEES (EXCEPT AS WITHHOLD AUTHORITY TO
INDICATED TO THE CONTRARY). VOTE FOR ALL NOMINEES.
Election of
Directors / / / / NOMINEES: Daniel T. Carroll, John S. Carton, Douglas E.
Ebert, Sidney E. Forbes, Sue L. Gin, Morton E.
Harris, Gerald B. Mitchell, Robert J. Mylod,
William F. Pickard, Stanton Kinnie Smith, Jr.,
Walter H. Teninga, Stephen A. Van Andel,
Richard T. Walsh, and James A. Williams.
To withhold authority to vote for any individual nominee, write that
nominee's name on the space provided below.
- ----------------------------------------------------- NOTE: IF YOU DO NOT PROVIDE TIMELY AND PROPER VOTING INSTRUCTIONS, THEN
YOUR ALLOCATED SHARES IN THE EMPLOYEE STOCK OWNERSHIP PLAN AND
TRUST AND/OR THE DEFERRED COMPENSATION PLAN AND TRUST WILL BE VOTED
IN THE SAME PROPORTION AS THOSE SHARES FOR WHICH TIMELY AND PROPER
VOTING INSTRUCTIONS ARE RECEIVED. IF YOU DO NOT PROVIDE TIMELY AND
PROPER VOTING INSTRUCTIONS, YOUR PAYSOP SHARES WILL NOT BE VOTED.
PLEASE MARK (OPTIONAL), SIGN, DATE AND RETURN THIS CONFIDENTIAL
VOTING INSTRUCTION CARD IN THE ENCLOSED ENVELOPE.
Date: --------------------------------, 1994
--------------------------------
Signature
- --------------------------------------------------------------------------------
EMPLOYEE