1
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 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[X] Preliminary proxy statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
COMERICA INCORPORATED
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] 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 (Set forth the amount on which the filing
fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] 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:
- --------------------------------------------------------------------------------
2
Comerica Logo
COMERICA INCORPORATED
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
AND
PROXY STATEMENT
1998
3
COMERICA LOGO
COMERICA INCORPORATED
COMERICA TOWER AT DETROIT CENTER
500 WOODWARD AVENUE
DETROIT, MICHIGAN 48226
April 10, 1998
Dear Shareholder,
You are cordially invited to attend our Annual Meeting of Shareholders at 9:30
a.m., Eastern Daylight Savings Time, on Friday, May 15, 1998 at the Renaissance
Conference Center, Level 2, Tower 300 of the Renaissance Center, Detroit,
Michigan. Registration will begin at 8:30 a.m. A map showing the location of the
meeting is on the back cover of the accompanying Proxy Statement.
The Annual Report, which we mailed to you, summarizes Comerica's major
developments during 1997 and includes the 1997 financial statements.
Whether or not you plan to attend the meeting, please complete and mail the
enclosed proxy card promptly so that your shares will be voted as you desire. IF
YOU WISH TO VOTE IN THE MANNER THE BOARD OF DIRECTORS RECOMMENDS, IT IS NOT
NECESSARY TO SPECIFY YOUR CHOICES ON THE PROXY CARD. SIMPLY SIGN, DATE AND
RETURN THE PROXY CARD. YOU MAY ALSO VOTE BY TELEPHONE BY FOLLOWING THE
INSTRUCTIONS FOR USING THE AUTOMATED TELEPHONE VOTING SYSTEM PROVIDED ON THE
PROXY CARD.
Sincerely,
EUGENE A. MILLER
Eugene A. Miller
Chairman and Chief Executive Officer
4
Comerica Logo
COMERICA INCORPORATED
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 15, 1998
Date: May 15, 1998
Time: 9:30 a.m., Detroit, Eastern Daylight
Savings Time
Place: Level 2, Tower 300 of the Renaissance
Center
Detroit, Michigan 48226
We invite you to attend the Comerica Incorporated ("Comerica") Annual Meeting of
Shareholders to:
1. Elect four Class II Directors for three year terms expiring in 2001 or
upon the election and qualification of their successors.
2. Approve an amendment to Comerica's Certificate of Incorporation to
increase the number of shares of common stock which Comerica is
authorized to issue from 250,000,000 to 325,000,000.
3. Transact any other business that is properly submitted before the Annual
Meeting or any adjournments of the meeting.
The record date for the meeting is March 23, 1998 (the "Record Date"). Only
shareholders of record at the close of business on that date can vote at the
Annual Meeting. Comerica mailed this Notice of Annual Meeting to those
shareholders.
A list of shareholders who can vote at the Annual Meeting will be available for
inspection by shareholders at the meeting and for ten days prior to the meeting
during regular business hours at the offices of the Corporate Legal Department,
on the 33rd Floor of Comerica Tower at Detroit Center, 500 Woodward Avenue,
Detroit, Michigan 48226.
Whether or not you plan to attend the meeting, the Board of Directors urges you
to vote promptly. You may vote by signing, dating and returning the enclosed
proxy card promptly or by using the automated telephone voting system. You will
find instructions for voting by telephone on the enclosed proxy card.
By Order of the Board of Directors,
GEORGE W. MADISON
George W. Madison
Executive Vice President,
General Counsel and Corporate
Secretary
April 10, 1998
5
TABLE OF CONTENTS
1998 Proxy Statement........................................ 1
Two Proposals On Which You Are Voting....................... 3
Information about Nominees and Incumbent Directors.......... 4
Nominees for Class II Directors -- Terms Expiring in 2001... 4
Incumbent Directors -- Terms Expiring in 2000 (Class I
Directors)................................................ 4
Incumbent Directors -- Terms Expiring in 1999 (Class III
Directors)................................................ 5
Committees and Meetings of Directors........................ 6
Compensation Committee Interlocks and Insider
Participation............................................. 7
Compensation of Directors................................... 7
Retirement Plan for Directors............................... 8
Security Ownership of Certain Beneficial Owners............. 8
Security Ownership of Management............................ 9
Section 16(a) Beneficial Ownership Reporting Compliance..... 10
Transactions of Directors and Executive Officers with
Comerica.................................................. 10
Executive Officers.......................................... 11
Compensation of Executive Officers.......................... 14
Summary Compensation Table.................................. 14
Option Grants in Last Fiscal Year........................... 15
Aggregated Option Exercises in Last Fiscal Year and Fiscal
Year-End Option Values.................................... 15
Long-Term Incentive Plan Awards in Last Fiscal Year......... 16
Defined Benefit Pension Plan Benefits....................... 16
Employment Contracts and Severance Agreements............... 18
Change of Control Agreements................................ 20
Compensation Committee Report............................... 23
Stock Ownership Targets..................................... 25
Performance Graph........................................... 26
Independent Accountant...................................... 27
Shareholder Proposals....................................... 27
Annual Report to Shareholders............................... 27
Other Matters............................................... 27
i
6
COMERICA LOGO
Comerica Incorporated
Comerica Tower at Detroit Center
500 Woodward Avenue
Detroit, Michigan 48226
1998 PROXY STATEMENT
QUESTIONS AND ANSWERS
WHAT IS A PROXY?
A: A proxy is a document, also referred to as a proxy card (which is enclosed),
by which you authorize someone else to vote for you in the way that you want to
vote. Comerica's Board of Directors is soliciting this proxy. You may also
abstain from voting if you so choose.
WHAT IS A PROXY STATEMENT?
A: A proxy statement is the document the United States Securities and Exchange
Commission (the "SEC") requires to explain the matters on which you are asked to
vote on the proxy card.
WHO CAN VOTE?
A: Only holders of shares of Comerica's common stock at the close of business on
March 23, 1998 can vote at the Annual Meeting. Each shareholder of record has
one vote for each share of common stock on each matter presented for a vote at
the meeting.
WHAT WILL I VOTE ON AT THE MEETING?
A: At the Annual Meeting, shareholders will vote to:
1. Elect four Class II Directors for three year terms expiring in 2001 or
upon the election and qualification of their successors.
2. Approve an amendment to Comerica's Certificate of Incorporation to
increase the number of shares of common stock which Comerica is authorized
to issue from 250,000,000 to 325,000,000.
3. Transact any other business that is properly submitted before the Annual
Meeting or any adjournments of the meeting.
HOW DOES THE RECENT STOCK SPLIT AFFECT THIS PROXY STATEMENT?
A: On January 15, 1998, Comerica's Board of Directors declared a three-for-two
stock split, payable in the form of a 50% stock dividend on April 1, 1998 (the
"Payment Date") to shareholders of record on March 15, 1998. The Record Date for
the Annual Meeting is before the Payment Date; therefore each shareholder will
vote a pre-split number of shares at the Annual Meeting. Accordingly, Comerica
has not adjusted the numerical information relating to shares of Comerica's
common stock in this Proxy Statement to reflect the stock split.
HOW CAN I VOTE?
A: You can vote in person, by telephone or by proxy. To vote by proxy, sign,
date and return the enclosed proxy card. To vote by using the automated
telephone voting system, you must hold your shares in your name, and not in the
name of a broker, dealer, bank or other third party, and you should follow the
instructions on the enclosed proxy card. If you returned your signed proxy card
to Comerica before the Annual Meeting, the persons named as proxies on the card
7
will vote your shares as you directed. You may revoke a proxy at any time before
the proxy is exercised by (1) giving written notice of revocation to the
Corporate Secretary of Comerica at the address listed in the third paragraph of
the Notice of Annual Meeting of Shareholders; (2) submitting another proxy that
is properly signed and later dated; (3) voting in person at the meeting (but
only if the shares are registered in Comerica's records in the name of the
shareholder and not in the name of a broker, dealer, bank or other third party);
or (4) if you previously voted by telephone, voting by telephone at a subsequent
time.
IS MY VOTE CONFIDENTIAL?
A: Yes, your vote is confidential. Only the inspectors of election and certain
employees associated with processing proxy cards and counting the vote have
access to your proxy card. All comments you direct to management (whether
written on the proxy card or elsewhere) will remain confidential unless you ask
that your name be disclosed.
WHAT IS A QUORUM?
A: There were 104,838,086 shares of Comerica's common stock outstanding on the
Record Date. A majority of the outstanding shares, or 52,419,044 shares, present
or represented by proxy, constitutes a quorum. A quorum must exist to conduct
business at the Annual Meeting.
HOW DOES VOTING WORK?
A: If a quorum exists, each director and the amendment to the Certificate of
Incorporation must receive the favorable vote of a majority of the shares voted,
excluding abstentions and broker non-votes. A broker non-vote is a proxy a
broker submits that does not indicate a vote for some or all the proposals
because the broker does not have discretionary voting authority and the broker
did not receive instructions as to how to vote on those proposals.
Comerica will vote properly executed proxies it receives prior to the meeting in
the way you have directed. If you do not specify instructions, the shares
represented by proxies will be voted to elect the nominees for Class II
Directors and to approve the amendment to Comerica's Certificate of
Incorporation. No other proposals are currently scheduled to be presented at the
meeting.
An independent third party acts as the inspector of the meeting and the
tabulator of votes.
WHO PAYS FOR THE COSTS OF THE MEETING?
A: Comerica pays the cost of preparing and printing the Proxy Statement and
soliciting proxies. Comerica will solicit proxies primarily by mail, but may
also solicit proxies personally and by telephone, facsimile or other means.
Comerica will use the services of Georgeson & Company, Inc., a proxy
solicitation firm, at a cost of $9,000 plus out-of-pocket expenses and fees for
any special services. Officers and regular employees of Comerica and its
subsidiaries may also solicit proxies, but will receive no additional
compensation for soliciting proxies, nor will their efforts result in more than
a minimal cost to Comerica. Comerica also will reimburse banks, brokerage houses
and other custodians, nominees and fiduciaries for their out-of-pocket expenses
for forwarding solicitation material to beneficial owners of Comerica's common
stock.
WHAT PERCENTAGE OF STOCK DO OFFICERS AND DIRECTORS OWN?
A: Together, executive officers, directors and director nominees owned
approximately 3.3% of Comerica's common stock as of the Record Date.
2
8
THE TWO PROPOSALS ON WHICH YOU ARE VOTING:
PROPOSAL 1: ELECTION OF DIRECTORS
Comerica's Board of Directors is divided into three classes with each class of
directors elected to a three-year term of office. At each annual meeting of
shareholders, shareholders elect one class of directors for a three-year term to
succeed the class of directors whose term of office expires at that meeting.
This year you are voting on four candidates for the Class II Directors. Based on
the recommendation of the Directors Committee, Comerica's Board of Directors has
nominated James F. Cordes, Eugene A. Miller, Martin D. Walker and Kenneth L.
Way. Messrs. Cordes and Miller currently serve as Class II directors, Mr. Walker
is currently a Class III director and Mr. Way is a director of Comerica Bank, a
subsidiary of Comerica. If the shareholders elect Mr. Walker as a Class II
director, the Board of Directors, will fill the vacancy created in Class III by
his election, in accordance with Comerica's bylaws and upon the conclusion of
its current search for an additional director. Class III directors will stand
for re-election next year. Each of the nominees has consented to his or her
nomination and has agreed to serve as a director of Comerica, if elected.
If any director is unable to stand for re-election, Comerica may vote the shares
to elect any substitute nominees recommended by the Directors Committee. If the
Directors Committee does not recommend any substitute nominees, the number of
directors to be elected at the Annual Meeting may be reduced by the number of
nominees who are unable to serve.
For more information on Comerica's Board of Directors and these nominees, please
refer to pages 4 and 5 of this Proxy Statement.
Comerica's Board of Directors recommends a vote FOR these directors.
PROPOSAL 2: PROPOSAL TO AMEND COMERICA'S CERTIFICATE OF INCORPORATION
OVERVIEW: On January 20, 1998, the Board of Directors approved a proposal to
amend Comerica's Certificate of Incorporation to increase the number of shares
of common stock which Comerica is authorized to issue from 250,000,000 to
325,000,000. If adopted, Comerica will file the amendment on the next business
day after the Annual Meeting.
Appendix A to this Proxy Statement contains the text of the proposed amendment
to the Certificate of Incorporation. The amendment will not affect the number of
authorized shares of preferred stock, which is 10,000,000 shares.
REASON FOR INCREASE IN NUMBER OF AUTHORIZED SHARES: Comerica requires the
increase in authorized shares of common stock to enable Comerica to maintain a
number of shares sufficient to meet all anticipated requirements, such as the
issuance of shares in a stock split in the future and to provide flexibility for
other corporate purposes.
The proposed amendment would increase the number of shares of common stock which
Comerica is authorized to issue from 250,000,000 to 325,000,000. The additional
75,000,000 shares would be a part of the existing class of common stock and, if
and when issued, would have the same rights and privileges as the shares of
common stock presently issued and outstanding. Each shareholder of Comerica
common stock has the right to acquire Series D Participating Preferred Stock
("Rights") in the event of the occurrence of certain triggering events described
in the Rights Plan. The holders of common stock of Comerica are not entitled to
preemptive rights or cumulative voting.
The Board of Directors recommends a vote FOR this proposal.
3
9
INFORMATION ABOUT NOMINEES AND INCUMBENT DIRECTORS
The following tables provide information about each nominee for election as a
Class II Director and for each of the Class I and Class III Directors whose term
of office will continue after the meeting.
NOMINEES FOR CLASS II DIRECTORS -- TERMS EXPIRING IN 2001
PRINCIPAL OCCUPATION AND BUSINESS
EXPERIENCE DURING PAST 5 YEARS DIRECTOR
NOMINEES AGE AND OTHER DIRECTORSHIPS(1) SINCE(2)
- --------------------------------------------------------------------------------------------------------
James F. Cordes................ 57 Retired; Executive Vice President, The Coastal 1984
Corporation (diversified energy company) (until March
1997); President, American Natural Resources Company
(diversified energy company) (until March 1997);
Director, The Coastal Corporation.
Eugene A. Miller............... 60 Chairman and Chief Executive Officer (since June 1979
1993), President and Chief Operating Officer (June
1992-June 1993), Chairman, President and Chief
Executive Officer (until June 1992), Comerica
Incorporated; Chairman and Chief Executive Officer
(since June 1992), Chairman, President and Chief
Executive Officer (until June 1992), Comerica Bank;
Director, DTE Energy Company and The Detroit Edison
Company.
Martin D. Walker............... 65 Principal, MORWAL Investments (a private investment 1996 and
group); Chairman (until June 1997); Chairman and Chief 1979-1992
Executive Officer (until December 1996), M.A. Hanna
Company (international specialty chemicals company);
Director, Lexmark International, Inc., Reynolds &
Reynolds, Textron Inc., The Goodyear Tire & Rubber
Company, The Timken Company and Meritor Automotive
Inc.
Kenneth L. Way................. 58 Chairman and Chief Executive Officer (since June N/A
1988), Lear Corporation (manufacturer of automotive
components); Director, Comerica Bank, and Director,
R.P. Scherer Corporation.
INCUMBENT DIRECTORS -- TERMS EXPIRING IN 2000
(CLASS I DIRECTORS)
PRINCIPAL OCCUPATION AND BUSINESS
EXPERIENCE DURING PAST 5 YEARS DIRECTOR
NAME AGE AND OTHER DIRECTORSHIPS(1) SINCE(2)
- --------------------------------------------------------------------------------------------------------
E. Paul Casey.................. 68 Managing General Partner, Metapoint Partners 1973
(investment partnership); Director, Wyman-Gordon
Company.
Max M. Fisher.................. 89 Investor; Director, Sotheby's Holdings, Inc. 1973
John D. Lewis.................. 49 Vice Chairman, (since Jan 1994 and Jan 1990-June 1994 and
1992); Executive Vice President (June 1992-Jan 1994), 1989-1992
Comerica Incorporated; Vice Chairman (since Mar 1995
and Jan 1990-June 1992), Comerica Bank.
Howard F. Sims................. 64 Chairman and Director, Sims-Varner & Associates, 1981
P.L.L.C. (architectural, engineering and planning
firm); Director, MCN Energy Group.
4
10
INCUMBENT DIRECTORS -- TERMS EXPIRING IN 1999
(CLASS III DIRECTORS)
PRINCIPAL OCCUPATION AND BUSINESS
EXPERIENCE DURING PAST 5 YEARS DIRECTOR
NAME AGE AND OTHER DIRECTORSHIPS(1) SINCE(2)
- --------------------------------------------------------------------------------------------------------
J. Philip DiNapoli............. 58 Manager, Real Estate Division of DiNapoli family 1991
holdings; Chairman and Director, Comerica Bank-
California; Director, SJW Corp.
Wayne B. Lyon.................. 65 Chairman, President and Chief Executive Officer, 1986
Lifestyle Furnishings International Ltd. (manufacturer
of residential furniture, decorative home furnishings
and fabrics (since August 1996)); President and Chief
Operating Officer, Masco Corporation (manufacturer of
diversified household and consumer products (until
August 1996)); Director, Masco Corporation and Emco
Limited.
Michael T. Monahan............. 59 President (since June 1993), Comerica Incorporated; 1993 and
President (since June 1993), President and Chief 1985-1992
Operating Officer (June 1992-June 1993), Comerica
Bank; President (until June 1992), Manufacturers
National Corporation; President and Chief Operating
Officer (until June 1992), Manufacturers Bank, N.A.;
Director, Jacobson Stores, Inc. and Hertz Corporation.
Alfred A. Piergallini.......... 51 Vice Chairman, President and Chief Executive Officer, 1991
Gerber Products Company (producer and marketer of baby
food, baby care and infant apparel); Director, Gerber
Products Company and Toy Biz, Inc.
Martin D. Walker(3)............ 65 Principal, MORWAL Investments (a private investment 1996 and
group); Chairman (until June 1997), Chairman and Chief 1979-1992
Executive Officer (until December 1996), M.A. Hanna
Company (international specialty chemicals company);
Director, Lexmark International, Inc., Reynolds &
Reynolds, Textron Inc., The Goodyear Tire & Rubber
Company, The Timken Company and Meritor Automotive,
Inc.
- ------------------------------
(1) This column includes principal occupations and employment with subsidiaries
and other affiliates of Comerica and of Manufacturers National Corporation,
which merged with Comerica on June 18, 1992. Comerica Bank and Comerica
Bank-California are wholly-owned subsidiaries of Comerica. Manufacturers
Bank, N.A. was a wholly-owned subsidiary of Manufacturers National
Corporation.
(2) This column represents the year each nominee or incumbent director became a
director of Comerica or of Manufacturers National Corporation.
(3) The Board of Directors has nominated Mr. Walker as a Class II director
nominee. If the shareholders elect Mr. Walker as a Class II director, the
Board of Directors will fill the vacancy created in Class III by his
election, in accordance with Comerica's bylaws and upon the conclusion of
its current search for an additional director.
5
11
COMMITTEES AND MEETINGS OF DIRECTORS
Comerica's Board of Directors has several committees, as set forth in the
following chart.
MEMBERSHIP ROSTER
AUDIT AND RISK ASSET
EXECUTIVE* LEGAL COMPENSATION DIRECTORS QUALITY REVIEW
NAME COMMITTEE COMMITTEE COMMITTEE COMMITTEE COMMITTEE
E. Paul Casey X X**
James F. Cordes X X**
J. Philip DiNapoli X X
Max M. Fisher X X
John D. Lewis X
Patricia Shontz Longe, Ph.D.*** X** X
Wayne B. Lyon X** X
Gerald V. MacDonald*** X
Eugene A. Miller X** X X
Michael T. Monahan X X X
Alfred A. Piergallini X X
Howard F. Sims X X
Martin D. Walker X X
*The Executive Committee is comprised of these three executive officers and a
minimum of any four non-employee directors who are available at the time it
is necessary for the Executive Committee to act.
**Chairperson
***Dr. Longe and Mr. MacDonald are incumbent Class II directors whose terms will
expire at the Annual Meeting.
EXECUTIVE COMMITTEE. This committee can exercise the authority, powers and
duties of the Board of Directors in managing the business and affairs of
Comerica between meetings of the board, if necessary. In the event that the
committee convenes, the committee's members are the three executive officers
identified in the chart and a minimum of any four non-employee directors who are
available at that time. The Executive Committee did not meet during 1997 because
it was not necessary. The Board of Directors or other appropriate committees
managed Comerica's business and affairs during 1997.
AUDIT AND LEGAL COMMITTEE. This committee includes members with banking or
related financial management expertise and does not include directors who are
considered large customers of Comerica or any affiliate. The committee is
responsible for review and recommendation of Comerica's Audit Policy and Code of
Ethics, Comerica's significant litigation, the scope and procedures of
Comerica's internal and external audit process, the selection and performance
review of Comerica's independent auditors, the review of programs and procedures
designed to avoid conflicts of interest and to promote compliance with laws,
regulations and corporate policy and the investigations of any suspected
improprieties. The Audit and Legal Committee met four times during 1997.
COMPENSATION COMMITTEE. This committee establishes Comerica's executive
compensation policies and programs, administers Comerica's 401k, stock,
incentive and deferral plans and monitors compliance with laws and regulations
applicable to the documentation and administration of Comerica's employee
benefit plans. The Compensation Committee met three times during 1997.
DIRECTORS COMMITTEE. This committee monitors the effectiveness of the Board of
Directors. Among its various duties, the committee reviews and recommends board
members, develops and administers performance criteria for members of the board,
and establishes the size of the
6
12
board, its committee structure and assignments, and the conduct and frequency of
board meetings. The committee also administers Comerica's Stock Option Plan for
Non-Employee Directors (excluding the provisions for discretionary grants under
the plan) and Comerica's Stock Option Plan for Non-Employee Directors of
Comerica Bank and Affiliated Banks. The Directors Committee met once during
1997.
RISK ASSET QUALITY REVIEW COMMITTEE. This committee reviews Comerica's credit
policies and promotes the use of sound operating procedures for credit
administration throughout the various affiliates of Comerica. Among its various
duties, the committee reviews Comerica's credit quality statistics and reserve
levels, and annually approves financial policies. The Risk Asset Quality Review
Committee met three times during 1997.
BOARD AND COMMITTEE MEETINGS. There were six regular meetings, and one special
meeting, of the Board of Directors and eleven meetings of the various committees
of the board during 1997. All director nominees and incumbent directors who are
standing for re-election attended at least seventy-five percent of the aggregate
number of meetings held by the Board of Directors and by all the committees of
the board on which the respective directors served.
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
No member of the Compensation Committee was a former officer or a current
officer or employee of Comerica or any of its subsidiaries. There were no
compensation committee interlocks between Comerica and any other entity during
the fiscal year.
COMPENSATION OF DIRECTORS
FEES. Directors who are employees of Comerica do not receive additional
compensation for their service on the Board of Directors and its committees.
During 1997, non-employee directors received an annual retainer of $20,000 and
$1,000 each time a director attended a meeting of the Board of Directors. Each
non-employee director who served on a committee of the board also received
$1,000 each time such director attended a committee meeting. The chairman of
each committee received an additional annual retainer of $4,000. Comerica also
reimburses directors for all expenses incurred for the purpose of attending
board and committee meetings.
STOCK OPTION PLAN. Comerica has a stock option plan for non-employee directors.
On the date of each annual meeting of shareholders, each non-employee director
receives an option to purchase 1,000 shares of common stock of Comerica. The
exercise price of each option is the fair market value of each share of common
stock on the date the option is granted. Options are exercisable one year after
the date of the grant and expire ten years after the grant date.
INSURANCE. Comerica provides a $150,000 business travel, accidental death and
dismemberment insurance benefit for each non-employee director and maintains
directors' and officers' liability insurance policies with a primary limit of
$20 million and excess limits of $20 million each. The primary limit policy is
insured through the Financial Institution Risk Retention Group. The Federal
Insurance Company (a member of the Chubb Group) and Executive Risk are the
primary insurers for the excess limit policies.
7
13
RETIREMENT PLAN FOR DIRECTORS
Comerica has a retirement plan for non-employee directors who have served at
least five years on the Board of Directors. For the purpose of determining
retirement income, each director receives credit for service on the Board of
Directors of Comerica and Manufacturers National Corporation.
Benefits become payable when the director reaches age 65 or retires from the
board, whichever occurs later. Payments may commence prior to the director's
65th birthday if he or she retires from the board due to illness or disability.
Under the plan, Comerica accrues, on behalf of each eligible director, one month
of retirement income credit for each month of service up to a maximum of one
hundred twenty months. Upon retirement, an eligible director receives a monthly
retirement benefit equal to one-twelfth of the annual retainer fee in effect for
directors on the date of such director's retirement. The eligible director
receives retirement benefits for the total number of months the director has
accrued retirement income credit, but payments terminate upon the director's
death.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The SEC requires that Comerica provide information on any shareholder who
beneficially owns more than 5% of Comerica's common stock. The following table
provides the required information, as of February 28, 1998, by the only
shareholder known to Comerica to be the beneficial owner of more than 5% of
Comerica's common stock. Comerica relied solely on information furnished to
Comerica by the shareholder to provide this information.
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
PERCENT
NAME AND ADDRESS AMOUNT AND NATURE OF
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP(1)(2) CLASS
- ------------------- ----------------------------- -------
FMR Corp 6,720,068 6.3%
80 Devonshire Street
Boston, MA 02109
- ------------------------------
(1) This number includes 5,818,921 shares owned by Fidelity Management &
Research Company ("FMRC"), as investment adviser, 836,847 shares
beneficially owned by Fidelity Management Trust Company ("FTMC"), as trustee
or managing agent of various private investment accounts, or as investment
adviser, and 64,300 shares beneficially owned by Fidelity International
Limited ("FIL"), as investment adviser.
(2) FMR Corp and FMRC each has sole power to dispose of the shares owned by
FMRC, but sole power to vote or direct the voting of such shares resides in
the board of trustees of FMRC. FMR has sole dispositive power over all
shares owned by FMTC, sole power to vote 524,375 of such shares and no power
to vote the remaining 312,472 shares. FIL has sole voting and dispositive
power over all shares owned by it.
8
14
SECURITY OWNERSHIP OF MANAGEMENT AND DIRECTORS
The following table contains information about the number of shares of
Comerica's common stock beneficially owned by incumbent directors, nominees and
the executive officers named in the Summary Compensation Table presented on page
14 of this Proxy Statement (the "named executive officers"), and by all
incumbent directors, nominees and executive officers as a group. The number of
shares beneficially owned by each individual includes shares over which the
person shares voting power or investment power and also any shares which the
individual can acquire by May 23, 1998, (60 days after the Record Date) through
the exercise of any stock option or other right. Unless indicated otherwise,
each individual has sole investment and voting power (or shares those powers
with his or her spouse) with respect to the shares listed in the table.
AMOUNT AND NATURE PERCENT
NAME OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP OF CLASS
------------------------ ----------------------- --------
Ralph W. Babb Jr 28,996(1) *
E. Paul Casey 19,574(2) *
James F. Cordes 29,891(2) *
J. Philip DiNapoli 198,229(2) *
Max M. Fisher 1,733,840(2)(3) 1.6%
John D. Lewis 161,298(4) *
Patricia Shontz Longe, Ph.D 7,860(2)(5) *
Wayne B. Lyon 19,960(2) *
Gerald V. MacDonald 31,023(2)(6) *
Eugene A. Miller 465,206(7) *
Michael T. Monahan 272,313(8) *
Alfred A. Piergallini 16,000(2) *
Fenton R. Talbott 20,250(9) *
Howard F. Sims 9,152(2) *
Martin D. Walker 6,448(2) *
Kenneth L. Way 3,000(10) *
Directors, nominees and executive
officers as a group (30 people) 3,573,095(11) 3.3%
- ------------------------------
* Represents holdings of less than one percent.
(1) Includes 10,000 shares of common stock of Comerica which Mr. Babb will
forfeit if he does not remain an employee until June 1, 2000, and options
to purchase 17,000 shares of common stock of Comerica, which Comerica
granted to Mr. Babb under Comerica's Long-Term Incentive Plan.
(2) Includes currently exercisable options to purchase 2,000 shares of common
stock of Comerica and options to purchase 1,000 shares of common stock of
Comerica which will become exercisable by May 23, 1998. Comerica granted
these options under Comerica's Stock Option Plan for Non-Employee
Directors.
(3) Includes 441,288 shares owned by a corporation and 8,164 shares owned by
Mr. Fisher as a trustee. Mr. Fisher shares voting and investment powers
over these shares and disclaims beneficial ownership of them. The shares
shown for Mr. Fisher do not include 98,162 shares owned by members of his
family and shares held in trust for their benefit. Mr. Fisher does not
beneficially own these shares under the rules of the SEC. Mr. Fisher's
ownership combined with the ownership of these family members totals
1,832,002 shares.
(4) Includes 10,000 shares of common stock of Comerica which Mr. Lewis will
forfeit if he does not remain an employee until July 16, 1998, and options
to purchase 121,100 shares of common stock of Comerica, which Comerica
granted to Mr. Lewis under Comerica's Long-Term Incentive Plan.
(5) Dr. Longe is not standing for re-election.
(6) Mr. MacDonald is not standing for re-election.
(7) Includes options to purchase 281,104 shares of common stock of Comerica,
which Comerica granted to Mr. Miller under Comerica's Long-Term Incentive
Plan. The shares shown for Mr. Miller also include 10,000 shares owned by
Mr. Miller's spouse as trustee, 476 shares owned jointly by Mr. Miller and
his son and 300 shares held by Mr. Miller as custodian for his daughter.
Mr. Miller disclaims beneficial ownership of the shares owned by his spouse
as trustee, the shares he owns jointly with his son and the shares held in
custody for his daughter.
9
15
(8) Includes 15,000 shares of common stock of Comerica which Mr. Monahan will
forfeit if he does not remain an employee until July 16, 1998, and options
to purchase 123,412 shares of common stock of Comerica, which Comerica
granted to Mr. Monahan under Comerica's Long-Term Incentive Plan. The
shares shown for Mr. Monahan also include 10,430 shares owned by his spouse
as trustee as to which shares Mr. Monahan disclaims beneficial ownership.
(9) Includes 10,000 shares of common stock of Comerica which Mr. Talbott will
forfeit if he does not remain an employee until January 8, 2001, and
options to purchase 9,000 shares of common stock of Comerica, which
Comerica granted to Mr. Talbott under Comerica's Long-Term Incentive Plan.
(10) Includes options to purchase 1,000 shares of common stock of Comerica,
which Comerica granted to Mr. Way under Comerica's Stock Option Plan for
Non-Employee Directors.
(11) Includes 905,837 options to purchase shares of Comerica's common stock
beneficially owned by incumbent directors, nominees and executive officers
as a group. Comerica granted these options under Comerica's Long-Term
Incentive Plan, option plans of Manufacturers National Corporation and
Comerica's Stock Option Plan for Non-Employee Directors. Pursuant to the
terms of the merger agreement with Manufacturers National Corporation,
Comerica agreed to issue its stock in satisfaction of options issued under
the option plans of Manufacturers National Corporation.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires that
Comerica's directors, executive officers and persons who own more than ten
percent of a registered class of Comerica's equity securities file reports of
stock ownership and any subsequent changes in stock ownership with the SEC and
the New York Stock Exchange not later than specified deadlines. During 1997, all
of the required reports were filed by the specified deadlines. In making this
disclosure, Comerica relied on the directors and executive officers' written
representations and a review of copies of the reports filed with the SEC.
TRANSACTIONS OF DIRECTORS AND
EXECUTIVE OFFICERS WITH COMERICA
Several of the incumbent directors, director nominees and executive officers of
Comerica, their related entities and members of their immediate families were
customers of and had transactions (including loans and loan commitments) with
banking affiliates of Comerica during 1997. Comerica made all loans and
commitments 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 Comerica or its
subsidiaries, and the transactions did not involve more than the normal risk of
collection or present other unfavorable features. All loan transactions
presently in effect with any incumbent director, nominee, executive officer or
related entity are current as of the date of this Proxy Statement.
10
16
EXECUTIVE OFFICERS
The following table provides information about Comerica's executive officers.
The executive officers are the Chairman, President, Vice Chairman, Chief
Financial Officer, Controller of Comerica, officers of Comerica who are in
charge of principal business units, divisions or functions, and officers of
Comerica or its subsidiaries who perform significant policy making functions for
Comerica.
AGE
AS OF EXECUTIVE
APRIL 10, FIVE-YEAR OFFICER
NAME 1998 BUSINESS EXPERIENCE(1) SINCE
- -------------------------------------------------------------------------------------------------------------
Ralph W. Babb Jr. ............. 49 Executive Vice President and Chief Financial Officer 1995
(since June 1995), Comerica Incorporated and Comerica
Bank); Vice Chairman, Mercantile Bancorporation and
Mercantile Bank (until June 1995).
John R. Beran.................. 45 Executive Vice President (since May 1995), Comerica 1995
Incorporated and Comerica Bank; President and Chief
Executive Officer (Jan 1994-April 1995), Money Access
Service Corporation (electronic banking services);
Senior Vice President (until Dec 1993), Society
Corporation (bank holding company).
Joseph J. Buttigieg, III....... 52 Executive Vice President (since June 1995), Comerica 1992
Incorporated; Executive Vice President (since June
1992), Comerica Bank.
Richard A. Collister........... 53 Executive Vice President (since Nov 1992), Comerica 1992
Incorporated; Executive Vice President (since May
1993), Comerica Bank.
Marvin J. Elenbaas............. 46 Senior Vice President, Controller and Chief 1997
Accounting Officer (since Mar 1998); First Vice
President, Controller and Chief Accounting Officer
(until Mar 1998); First Vice President (from June
1992 until Oct 1997), Comerica Incorporated and
Comerica Bank.
George C. Eshelman............. 45 Executive Vice President (since Jan 1994), Comerica 1994
Incorporated; Executive Vice President (since Jan
1994), Senior Vice President (until Jan 1994),
Comerica Bank.
J. Michael Fulton.............. 49 Executive Vice President (since May 1997), Comerica 1993
Incorporated; President and Chief Executive Officer
(since July 1993), Executive Vice President (until
July 1993), Comerica Bank-California.
Dale E. Greene................. 51 Executive Vice President (since March 1996), Senior 1996
Vice President (until March 1996), Comerica Bank.
Charles L. Gummer.............. 51 Executive Vice President (since May 1997), Comerica 1992
Incorporated; President and Chief Executive Officer,
Comerica Bank-Texas.
11
17
AGE
AS OF EXECUTIVE
APRIL 10, FIVE-YEAR OFFICER
NAME 1998 BUSINESS EXPERIENCE(1) SINCE
- -------------------------------------------------------------------------------------------------------------
John R. Haggerty............... 54 Executive Vice President (since July 1994), Comerica 1994
Incorporated and Comerica Bank; President and Chief
Executive Officer (from July 1994 until December
1997), Comerica Mortgage Corporation; Executive Vice
President and Director (until June 1994), Banc One
Mortgage Corporation.
Thomas R. Johnson.............. 54 Executive Vice President (since May 1993), Comerica 1992
Incorporated; Executive Vice President (June 1992-May
1993), Comerica Bank; Senior Vice President (until
June 1992), Comerica Incorporated and Comerica Bank.
John D. Lewis.................. 49 Vice Chairman (since Jan 1994 and Jan 1990-June 1988
1992), Executive Vice President (June 1992-Jan 1994),
Comerica Incorporated; Vice Chairman (since Mar 1995
and Jan 1990-June 1992), Comerica Bank.
George W. Madison.............. 44 Executive Vice President, General Counsel and 1997
Corporate Secretary (since Jan 1997), Comerica
Incorporated; Executive Vice President, General
Counsel, Corporate Secretary and Cashier (since Jan
1997), Comerica Bank; Partner (until Jan 1997),
Mayer, Brown & Platt (law firm).
Ronald P. Marcinelli........... 48 Executive Vice President (since Nov 1995), Comerica 1995
Incorporated and Comerica Bank; Senior Vice President
(June 1992-Nov 1995), Comerica Bank.
Eugene A. Miller............... 60 Chairman and Chief Executive Officer (since June 1978
1993), President and Chief Operating Officer (June
1992-June 1993), Chairman, President and Chief
Executive Officer (until June 1992), Comerica
Incorporated; Chairman and Chief Executive Officer
(since June 1992), Chairman, President and Chief
Executive Officer (until June 1992), Comerica Bank.
Michael T. Monahan............. 59 President (since June 1993), Comerica Incorporated; 1992
President (since June 1993), President and Chief
Operating Officer (June 1992-June 1993), Comerica
Bank; President (until June 1992), Manufacturers
National Corporation; President and Chief Operating
Officer (until June 1992), Manufacturers Bank, N.A.
David B. Stephens.............. 52 Executive Vice President (since Jan 1994), Comerica 1994
Incorporated and Comerica Bank; Senior Vice President
(until Jan 1994), Comerica Bank.
12
18
AGE
AS OF EXECUTIVE
APRIL 10, FIVE-YEAR OFFICER
NAME 1998 BUSINESS EXPERIENCE(1) SINCE
- -------------------------------------------------------------------------------------------------------------
Fenton R. Talbott.............. 56 Executive Vice President (since Jan 1996), Comerica 1996
Incorporated and Comerica Bank; Senior Vice President
(Jan 1994-Jan 1996), American Express Co. (financial
products and strategy); Chief Executive Officer
(until Jan 1994), Acuma, Ltd. (a London, England
subsidiary of American Express Co.).
James R. Tietjen............... 38 Senior Vice President and General Auditor (since Jan 1995
1995), First Vice President and Interim General
Auditor (June 1994-Dec 1994), First Vice President
and Interstate Audit Manager (Jan 1994-May 1994),
Vice President and Regional Audit Manager (June
1992-Dec 1993), Assistant Vice President and Audit
Manager (until May 1992), Comerica Incorporated.
- ------------------------------
(1) This column includes principal occupations and employment with subsidiaries
and other affiliates of Comerica and of Manufacturers National Corporation.
Comerica Bank, Comerica Bank-California and Comerica Bank-Texas are
wholly-owned subsidiaries of Comerica. Comerica Mortgage Corporation was a
wholly-owned subsidiary of Comerica Bank and merged into Comerica Bank in
December 1997. Manufacturers Bank, N.A. was a wholly-owned subsidiary of
Manufacturers National Corporation.
13
19
COMPENSATION OF EXECUTIVE OFFICERS
The following table summarizes the compensation of the five executive officers
of Comerica (the "named executive officers") who received the highest
compensation during the fiscal year ended December 31, 1997 and includes their
compensation for the fiscal years ended December 31, 1996 and December 31,1995.
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
---------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
RESTRICTED SECURITIES
OTHER STOCK UNDERLYING LTIP ALL OTHER
ANNUAL AWARD(S) OPTIONS PAYOUTS COMPENSATION
FISCAL SALARY BONUS COMPENSATION (1)(2) (3) (4) (5)(6)
NAME AND PRINCIPAL POSITION YEAR $ $ $ $ (#) $ $
- ---------------------------------- ------ ------- --------- ------ ------- ------- ------- ------
Eugene A. Miller 1997 700,000 1,120,000 14,286 0 75,000 280,000 33,405
Chairman of the Board and Chief 1996 675,000 1,080,000 14,800 0 100,000 128,346 29,625
Executive Officer, Comerica 1995 625,000 560,000 12,937 0 50,000 0 27,665
Incorporated and Comerica Bank
Michael T. Monahan 1997 510,000 714,000 9,994 0 50,000 206,307 18,465
President, Comerica 1996 510,000 714,000 13,092 0 35,000 87,759 14,658
Incorporated and Comerica Bank 1995 485,000 375,000 12,226 0 33,950 0 13,058
John D. Lewis 1997 400,000 560,000 9,586 0 27,500 160,080 14,696
Vice Chairman, Comerica 1996 385,000 539,000 9,865 0 25,000 67,494 13,304
Incorporated and Comerica Bank 1995 370,000 300,000 10,285 0 25,900 0 12,118
Ralph W. Babb Jr. 1997 325,000 390,000 20,954 0 14,000 110,763 15,904
Executive Vice President and 1996 315,000 378,000 43,960 0 12,000 32,537 10,804
Chief Financial Officer, Comerica 1995 173,085 300,000 10,244 315,000 15,000 0 0
Incorporated and Comerica Bank
Fenton R. Talbott 1997 300,000 360,000 21,337 0 12,000 82,386 8,529
Executive Vice President, 1996 294,231 460,000 53,538 377,500 12,000 20,265 3,545
Comerica Incorporated and Comerica
Bank
LTIP = long-term incentive plan
(1) As of December 31, 1997, each of the named executive officers held the
following number of shares of common stock ("restricted stock"), which the
named executive officer will forfeit if he does not remain an employee for
the term established by Comerica : Michael T. Monahan, 15,000 shares with a
market value of $1,353,750; John D. Lewis, 10,000 shares with a market value
of $902,500; Ralph W. Babb, Jr., 10,000 shares with a market value of
$902,500; and Fenton R. Talbott, 10,000 shares with a market value of
$902,500. Comerica calculated the market value using the closing price of
Comerica's common stock of $90.25 per share on December 31,1997. The market
value does not give effect to the diminution in value due to the
restrictions on this stock.
(2) Comerica pays dividends on restricted stock at the same rate and on the same
terms that it pays dividends on its common stock.
(3) Options granted under Comerica's option plans generally have a ten-year term
and become exercisable annually in 25% increments, beginning on the first
anniversary of the date of the option grant, except as determined otherwise
by the Compensation Committee. The options granted to Mr. Babb in 1995
became exercisable annually in 25% increments beginning in June 1996, except
that they will be exercisable immediately if Mr. Babb dies or becomes
permanently disabled, or upon a change of control of Comerica, or if
Comerica terminates Mr. Babb's employment without cause or if he resigns for
good reason. Comerica has never granted stock appreciation rights under the
Long-Term Incentive Plan.
(4) Amounts in this column represent incentive awards based on Comerica's
average return on equity performance for a three-year period from 1995
through 1997. Comerica pays fifty percent of the award to each of the named
executive officers in cash and fifty percent of the award in shares of
common stock which may not be transferred by the executive officer until the
executive's employment with Comerica terminates ("non-transferable stock").
On March 20, 1998, each of the named executive officers received shares of
non-transferrable stock pursuant to their 1997 incentive awards: Eugene A.
Miller, 1,306.8601 shares; Michael T. Monahan, 962.9086 shares; John D.
Lewis, 747.1487 shares; Ralph W. Babb Jr., 516.9692 shares; and Fenton R.
Talbott, 384.5226 shares. Comerica calculated the number of shares to be
awarded using a market price of $107.1270 on that date.
(5) Amounts for 1997 for each of the named executive officers include an $800
matching contribution and a $2,938 performance match under Comerica's 401(k)
plan. Amounts for 1997 also include life insurance premiums paid by Comerica
for the benefit of the named executive officers: (Eugene A. Miller, $24,761;
Michael T. Monahan, $13,570; John D. Lewis, $9,801; and Ralph W. Babb Jr.,
$7,259).
14
20
(6) Amounts for 1997 for each of the named executive officers include an
Employee Stock Purchase Plan matching contribution for the following named
executive officers in the amount set forth opposite such officer's name:
(Eugene A. Miller, $3,750; Ralph W. Babb Jr., $3,750; and Fenton R. Talbott,
$3,635). All participants in the Employee Stock Purchase Plan are eligible
to receive matching contributions. Amounts for 1997 for each of the named
executive officers include a contribution under Comerica's Gainsharing Plan
for the following named executive officers in the amount set forth opposite
such officer's name: (Eugene A. Miller, $1,157; Michael T. Monahan $1,157;
John D. Lewis, $1,157; Ralph W. Babb Jr., $1,157; and Fenton R. Talbott,
$1,157). All persons who were employed by Comerica as of the date set forth
in the plan received Gainsharing Plan contributions.
The following table provides information on stock options granted in 1997 to the
named executive officers.
OPTION GRANTS IN LAST FISCAL YEAR(1)
INDIVIDUAL GRANTS POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
OF STOCK PRICE APPRECIATION
FOR OPTION TERM(3)
NUMBER OF PERCENT OF
SECURITIES TOTAL OPTIONS
UNDERLYING GRANTED TO EXERCISE OR
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED(2) FISCAL YEAR ($/SH) DATE 0% ($) 5% ($) 10% ($)
------------------- ------ ---- ----- ---------- -- --------- ---------
Eugene A. Miller 75,000 5.8% 60.38 04/20/2007 0 2,847,949 7,217,263
Michael T. Monahan 50,000 3.9% 60.38 04/20/2007 0 1,898,633 4,811,508
John D. Lewis 27,500 2.1% 60.38 04/20/2007 0 1,044,248 2,646,330
Ralph W. Babb Jr. 14,000 1.1% 60.38 04/20/2007 0 531,617 1,347,222
Fenton R. Talbott 12,000 0.9% 60.38 04/20/2007 0 455,672 1,154,762
(1) Comerica has never granted stock appreciation rights under Comerica's
Long-Term Incentive Plan.
(2) This column represents the number of options granted to each named executive
officer in 1997. These options have a ten-year term and become exercisable
annually in 25% increments, beginning on January 16, 1998. The exercise
price is equal to the fair market value of the shares covered by each option
on the date each option was granted.
(3) Amounts in these columns represent the potential value which a holder of the
option may realize at the end of the option's term assuming the annual rates
of growth in the above columns. The value of the options has not been
discounted to reflect present values. These amounts are not intended to
forecast possible future appreciation, if any, of Comerica's stock price.
The following table provides information concerning the exercise of stock
options by the named executive officers during the last fiscal year and the
value of unexercised options at December 31, 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES(1)
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT
YEAR-END FISCAL YEAR-END(2)
SHARES ACQUIRED VALUE (#) (#) ($) ($)
NAME ON EXERCISE (#) REALIZED($) EXERCISABLE UNEXCERCISABLE EXERCISABLE UNEXCERCISABLE
- ----------------------- ------ --------- ------- ------- ---------- ---------
Eugene A. Miller 22,304 1,504,238(3) 245,731 184,725 16,314,755 8,323,981
Michael T. Monahan 0 0 86,937 99,963 5,221,134 4,346,691
John D. Lewis 0 0 96,362 64,338 6,333,403 2,931,439
Ralph W. Babb Jr. 0 0 10,500 30,500 597,000 1,327,930
Fenton R. Talbott 0 0 3,000 21,000 157,500 830,940
- ----------------------------------------------------------------------------------------------------------------------
(1) Comerica has never granted stock appreciation rights under the Long-Term
Incentive Plan.
(2) Value is calculated as of December 31, 1997 and is equal to the number of
shares of common stock multiplied by the closing price of a share of
Comerica's common stock. The closing price was $90.25 on December 31, 1997.
15
21
(3) Eugene A. Miller exercised one option grant with an expiring ten-year term.
He retained 10,000 shares and surrendered 12,304 shares to Comerica to
cover, among other things, option exercise transaction costs, including
applicable taxes.
LONG-TERM INCENTIVE PLAN AWARDS -- IN LAST FISCAL YEAR(1)
ESTIMATED FUTURE PAYOUTS
UNDER NON-STOCK
PRICE-BASED PLANS
PERFORMANCE THRESHOLD TARGET MAXIMUM(2)
NAME PERIOD ($) ($) ($)
---- ----------- --------- ------ ----------
Eugene A. Miller 1996-1998 0 150,000 300,000
Michael T. Monahan 1996-1998 0 110,000 192,500
John D. Lewis 1996-1998 0 82,000 143,500
Ralph W. Babb Jr. 1996-1998 0 34,000 102,000
Fenton R. Talbott 1996-1998 0 31,000 93,000
(1) Participants earn long-term awards under the Management Incentive Plan based
upon Comerica's attainment of specified objectives established by the
Compensation Committee in relation to Comerica's average return on equity
during the three year performance period. Comerica pays fifty percent of the
awards in cash and fifty percent in shares of Comerica's non-transferable
stock.
(2) Each year Comerica determines the amount necessary to fund long-term awards
under the Management Incentive Plan for the upcoming year. The maximum
stated for each named executive officer represents the funded amount
allocable to the aggregate annual incentive pool based on such executive
officer's organizational level and base salary. Actual payments to the named
executive officer are a function of the amount of the annual incentive
received by such executive officer in each of the three performance years
occurring during the performance period as a percentage of the aggregate
annual incentive pool paid in those three years to all participants in the
Management Incentive Plan. As a result, an individual's awards may exceed or
be less than the maximum funding allocable to that executive officer (as
stated in the table above). In no case will the long-term award, when
combined with the annual incentive, exceed 200% of the executive officer's
base salary.
DEFINED BENEFIT PENSION PLAN BENEFITS
Comerica maintains the Comerica Incorporated Retirement Plan (1994 Amendment and
Restatement), a tax-qualified defined benefit pension plan (the "Pension Plan").
The Pension Plan is a consolidation of the former Manufacturers National
Corporation Pension Plan (the "Manufacturers Plan") and the Comerica
Incorporated Retirement Plan (the "Comerica Plan"). Participants who retire
under the Pension Plan receive a pension based on a formula which takes into
consideration final average compensation (which includes salary and regular
bonuses) and years of service, including years of service credited under the
Manufacturers Plan and Comerica Plan to the former participants of these plans.
The Pension Plan is a tax-qualified plan. Under the Internal Revenue Code of
1986, as amended (the "Internal Revenue Code"), the current maximum annual
pension that any participant, including any named executive officer, may receive
under a qualified defined benefit plan is $130,000. The maximum annual
compensation of any participant which Comerica currently can consider in
computing a pension under a qualified plan is $160,000. To the extent that
Tables I, II and III reflect an annual pension greater than $130,000 or
compensation above $160,000, Comerica will pay the participant, including any
named executive officer, the additional amount under a non-qualified plan
maintained by Comerica.
16
22
Table I below provides estimates of the amounts payable as an annual pension
using various levels of final average compensation and years of service credited
under the Pension Plan in 1994 and later years. Comerica calculated the amounts
shown in Table I without applying the limitations under the Internal Revenue
Code which are discussed above and which apply to the Pension Plan.
TABLE I: ANNUAL PENSION UNDER PENSION PLAN BASED ON YEARS OF CREDITED SERVICE
FINAL
AVERAGE
COMPENSATION* 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
- ------------- -------- -------- -------- -------- -------- --------
$ 100,000 $ 13,949 $ 20,923 $ 27,897 $ 34,872 $ 41,846 $ 46,346
200,000 29,949 44,923 59,897 74,872 89,846 98,846
300,000 45,949 68,923 91,897 114,872 137,846 151,346
400,000 61,949 92,923 123,897 154,872 185,846 203,846
500,000 77,949 116,923 155,897 194,872 233,846 256,346
600,000 93,949 140,923 187,897 234,872 281,846 308,846
700,000 109,949 164,923 219,897 274,872 329,846 361,346
800,000 125,949 188,923 251,897 314,872 377,846 413,846
900,000 141,949 212,923 283,897 354,872 425,846 466,346
1,000,000 157,949 236,923 315,897 394,872 473,846 518,846
1,500,000 237,949 356,923 475,897 594,872 713,846 781,346
2,000,000 317,949 476,923 635,897 794,872 953,846 1,043,846
Tables II and III below provide estimates of the amounts payable as an annual
pension using various levels of final average compensation and years of service
credited in years prior to 1994. Comerica calculated the amounts shown in Tables
II and III without applying the limitations under the Internal Revenue Code
which are discussed above and which apply to the Pension Plan.
TABLE II: ANNUAL PENSION UNDER COMERICA PLAN
BASED ON YEARS OF CREDITED SERVICE
FINAL
AVERAGE
COMPENSATION* 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
- ------------- -------- -------- -------- -------- -------- --------
$ 100,000 $ 16,353 $ 24,529 $ 32,705 $ 40,881 $ 49,058 $ 57,234
200,000 33,853 50,779 67,705 84,631 101,558 118,484
300,000 51,353 77,029 102,705 128,381 154,058 179,734
400,000 68,853 103,279 137,705 172,131 206,558 240,984
500,000 86,353 129,529 172,705 215,881 259,058 302,234
600,000 103,853 155,779 207,705 259,631 311,558 363,484
700,000 121,353 182,029 242,705 303,381 364,058 424,734
800,000 138,853 208,279 277,705 347,131 416,558 485,984
900,000 156,353 234,529 312,705 390,881 469,258 547,234
1,000,000 173,853 260,779 347,705 434,631 521,558 608,484
1,500,000 261,353 392,029 522,705 653,381 784,058 914,734
2,000,000 348,853 523,279 697,705 872,131 1,046,558 1,220,984
- ------------------------------
* Based on the average of the highest 5 consecutive years of earnings in the
last 10 years of employment.
17
23
TABLE III: ANNUAL PENSION UNDER MANUFACTURERS PLAN
BASED ON YEARS OF CREDITED SERVICE
FINAL
AVERAGE
COMPENSATION 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
- ------------ -------- -------- -------- -------- -------- --------
$ 100,000 $ 14,502 $ 21,753 $ 29,004 $ 36,256 $ 43,507 $ 48,507
200,000 31,202 46,803 62,404 78,006 93,607 103,607
300,000 47,902 71,853 95,804 119,756 143,707 158,707
400,000 64,602 96,903 129,204 161,506 193,807 213,807
500,000 81,302 121,953 162,604 203,256 243,907 268,907
600,000 98,002 147,003 196,004 245,006 294,007 324,007
700,000 114,702 172,053 229,404 286,756 344,107 379,107
800,000 131,402 197,103 262,804 328,506 394,207 434,207
900,000 148,102 222,153 296,204 370,256 444,307 489,307
1,000,000 164,802 247,203 329,604 412,006 494,407 544,407
1,500,000 248,302 372,453 496,604 620,756 744,907 819,907
2,000,000 331,802 497,703 663,604 829,506 995,407 1,095,407
Comerica computed annual pensions under the Pension Plan using base salary and
bonuses for the year earned as reflected on page 14 in the Summary Compensation
Table.
The estimated years of service credited under the Pension Plan for each of the
named executive officers as of April 10, 1998 are as follows: Eugene A. Miller,
35 years; Michael T. Monahan, 35 years; John D. Lewis, 27.5 years; Ralph W. Babb
Jr., 1.5 years and Fenton R. Talbott, 1 year. The years of service credited to
Messrs. Miller and Lewis include the following years of service credited under
the Comerica Plan for which a past service pension is payable under the Pension
Plan: Mr. Miller, 35 years; and Mr. Lewis, 23.5 years. The years of service
credited to Mr. Monahan include 32.5 years of service credited under the
Manufacturers Plan for which a past service pension is payable under the Pension
Plan.
Under the Pension Plan, a participant who is unmarried at the time he or she
retires generally receives a pension in the form of a straight life annuity, the
annual amounts of which are listed in the tables above. A participant who is
married at the time he or she retires generally receives a pension in the form
of a joint and 50% survivor annuity, the amount of which is actuarially
equivalent to the straight life annuity. The pension amounts appearing in the
Pension Plan Tables I, II and III above assume that retirement will occur at age
65.
EMPLOYMENT CONTRACTS AND SEVERANCE AGREEMENTS
EUGENE A. MILLER is a party to an employment agreement with Comerica.(1) The
agreement provides that Mr. Miller will serve as Chairman of the Board and Chief
Executive Officer of Comerica through June 30, 1999. On July 1, 1999, the term
of the agreement will be extended automatically every two years until Mr.
Miller's 65th birthday unless a majority of the directors of Comerica vote
against an extension. For the duration of the agreement, Comerica has agreed to
nominate Mr. Miller to serve on its Board of Directors.
During the term of his employment agreement, Comerica pays Mr. Miller a base
salary and annual bonus payments in amounts determined by the Compensation
Committee as
- ---------------
1The change of control agreement, described below, supersedes this agreement if
there is a change of control as defined in the change of control agreement.
18
24
commensurate with his position and performance. He also is eligible for option
grants and restricted stock awards under Comerica's Long-Term Incentive Plan.
These grants and awards also will be commensurate with his position and
performance. In addition, Mr. Miller also is eligible to participate in all of
Comerica's executive compensation plans for senior executives which are in
effect during the term of the employment agreement and in any employee benefit
plans which Comerica maintains.
If Comerica terminates Mr. Miller's employment without cause, or if Mr. Miller
resigns for good reason, or Comerica causes Mr. Miller's employment agreement to
expire prior to his 65th birthday, Mr. Miller will receive the following
principal benefits:
- three times his annual base salary plus amount equal to his average
annual bonus during the three year period prior to the termination of his
employment, which will be paid in quarterly installments over a three year
period;
- accelerated vesting of any unexercised stock options;
- the early lapse of restrictions on previously awarded shares of
restricted stock;
- continuation of health and accident insurance coverages for Mr. Miller
and his wife for their lifetimes unless Mr. Miller receives comparable
coverages from another source;
- continuation of his life insurance coverage for three years; and
- commencing at the end of the three-year payment period referred to above,
a payment in the form elected by Mr. Miller under Comerica's defined
benefit pension plan and excess benefit plan, in an amount equal to the
excess of (a) the retirement benefits Mr. Miller would receive under the
plans if he continued to receive service credit until his 65th birthday,
over (b) the retirement benefits he actually accrued under the plans.
If Mr. Miller's employment is terminated less than three years before his 65th
birthday, Comerica will pro-rate the amount payable in connection with his
salary for the time period remaining until he reaches age 65. If Mr. Miller's
employment terminates for any of the reasons referred to above, the employment
agreement also provides that Comerica will use its best efforts, subject to the
fiduciary duties of the Board of Directors, to nominate Mr. Miller as a director
for the remainder of his life or until he reaches the mandatory retirement age
for members of the board.
If Mr. Miller retires, resigns without a good reason or if his employment
terminates because of disability or death or if Comerica terminates Mr. Miller's
employment for cause, Mr. Miller will receive his annual base salary to the date
of termination, fringe benefits and life, health, disability and accident
insurance to the date of termination.
If any payment to Mr. Miller under the employment agreement is subject to an
excise tax under Section 4999 of the Internal Revenue Code, Mr. Miller will
receive an additional payment so that the amount he receives equals the amount
he would receive under the agreement if an excise tax was not imposed.
MICHAEL T. MONAHAN participated in the Manufacturers National Corporation Key
Employee Retention Plan which Comerica assumed when it merged with Manufacturers
National Corporation. Mr. Monahan would have been eligible to receive severance
benefits under the plan if he retired prior to July 1, 1995. To encourage him to
remain with Comerica, Comerica entered into an agreement with Mr. Monahan which
provides certain benefits in lieu of the benefits he may have been eligible to
receive under the retention plan if he had retired on July 1, 1995. The
agreement provides that Mr. Monahan, or his beneficiary, is entitled to receive
the following benefits if he retires, dies or becomes disabled, or Comerica
involuntarily terminates his
19
25
employment with Comerica before February 1, 1999, or if his employment with
Comerica terminates for any reason on February 1, 1999:
- a cash payment of $3,000,000;
- continuation of his life, disability, accident and health insurance
benefits for three years after his employment terminates, unless he
becomes eligible to receive similar benefits from another employer during
the three year period;
- medical benefits for life; and
- except in the case of a voluntary retirement before February 1, 1999, the
accelerated vesting of all non-vested stock options held on the date of
termination and the early lapse of any remaining restrictions on
previously awarded shares of restricted stock.
RALPH W. BABB JR. is a party to an employment agreement with Comerica. The
agreement has a three-year term which expires on June 1, 1998. During the term
of his employment agreement, Comerica pays Mr. Babb a minimum annual base salary
of $300,000. Mr. Babb is also eligible for bonuses under Comerica's annual bonus
program. The agreement also provides a supplemental pension for Mr. Babb and his
wife if he remains with Comerica until June 1, 2000, or upon a change of control
of Comerica, or if Comerica terminates Mr. Babb's employment without cause or if
he resigns for good reason during the term of the agreement.
Upon entering into the employment agreement, Mr. Babb received a $100,000
signing bonus and an option to purchase 15,000 shares of Comerica's common
stock. He also received 10,000 shares of restricted common stock. The
restrictions on these shares cease if Mr. Babb remains employed with Comerica
until June 1, 2000. Restrictions relating to these shares will also cease prior
to that date if Mr. Babb dies or becomes permanently disabled, or upon a change
of control of Comerica, or if Comerica terminates Mr. Babb's employment without
cause or if he resigns for good reason.
Mr. Babb also is a party to a severance agreement with Comerica. The agreement
continues through May 31, 1998 and provides that Mr. Babb is entitled to receive
severance benefits if Comerica terminates his employment without cause or if he
resigns for good reason during the term of the agreement after a change of
control of Comerica. If Mr. Babb becomes entitled to receive severance benefits
under the agreement, he can receive in addition to other benefits: (1) an amount
equal to three times his annual base salary; (2) an amount equal to three times
the highest annual bonus he received previously; and (3) continuation of certain
benefits for three years. If any payment to Mr. Babb under the agreement is
subject to an excise tax under Section 4999 of the Internal Revenue Code, Mr.
Babb will receive an additional payment so that the amount he receives equals
the amount he would receive under the agreement if an excise tax was not
imposed. If an event occurs that could trigger a similar payment under both the
severance agreement and Mr. Babb's employment agreement, Mr. Babb will be
entitled to a payment under only one of the agreements.
CHANGE OF CONTROL AGREEMENTS
Each of Messrs. Miller, Lewis and Talbott is a party to a change of control
employment agreement with Comerica. These agreements become effective only in
the event of a change of control as defined in the agreement.
The agreement is for an initial three-year period (the "Agreement Period")
commencing on the date the named executive officer and Comerica sign the
agreement and is extended automatically at the end of each year for an
additional one year unless Comerica delivers written notice to such named
executive officer, at least sixty days prior to the annual renewal date, that
his agreement will not be extended. Comerica intends that the Agreement Period
will always be three years.
20
26
If a change of control of Comerica occurs during the Agreement Period, the
employment period begins and Comerica will continue the named executive
officer's employment for a period of thirty months from the date of the change
of control. During this employment period:
- The named executive officer's position and duties will be at least
commensurate with the most significant duties held by him during the
120-day period prior the date of a change of control.
- Comerica will assign the named executive officer an office at the
location where he was employed on the date the change of control occurred
or an office less than 60 miles from such office.
- Each named executive officer will receive a monthly base salary equal to
or greater than the highest monthly base salary he earned from Comerica
during the twelve-month period prior to the date of the change of control,
and an annual cash bonus at least equal to the highest bonus he earned
during any of the last three fiscal years prior to the date the change of
control occurred. (Comerica will annualize the amount of the bonus earned
by the named executive officer during any of these years if such named
executive officer was not employed by Comerica for the entire three-year
period.)
- The named executive officer also will be eligible to receive annual
salary increases and to participate in all of Comerica's executive
compensation plans and employee benefit plans, including health, accident,
disability and life insurance benefit plans, at least equal to the most
favorable of those plans which were in effect at any time during the
120-day period preceding the effective date of his agreement.
If the named executive officer dies or becomes disabled during the employment
period, he or his beneficiary will receive accrued obligations, including
salary, pro rata bonus, deferred compensation and vacation pay, and death or
disability benefits.
The agreement also provides severance benefits to the named executive officer if
Comerica terminates his employment for any reason other than cause or
disability, or he resigns for good reason during the employment period. Good
reason under the agreement includes termination of the agreement by the named
executive officer for any reason during the 30-day period immediately following
the first anniversary of the change of control. If the named executive officer
becomes entitled to receive severance benefits under his agreement, he will
receive in addition to other benefits:
- any unpaid base salary through the date of termination;
- a proportionate bonus based upon the highest annual bonus he earned
during any of the last three fiscal years prior to the effective date of
his agreement or during the most recently completed fiscal year;
- an amount equal to three times his annual base salary;
- an amount equal to three times the highest annual bonus he earned during
any of the last three fiscal years prior to the effective date of his
agreement or during the most recently completed fiscal year;
- payment under Comerica's defined benefit pension plan and any excess
benefit plan in which he participates, in an amount equal to the excess
of: (a) the retirement benefits he would receive under the plans if he
continued to receive service credit for three years after the date his
employment was terminated, over (b) the retirement benefits he actually
accrued under the plans;
- continuation of health, accident, disability and life insurance benefits
for three years after his employment terminates, unless he becomes
eligible to receive comparable benefits during the three-year period; and
21
27
- payment of any legal fees and expenses reasonably incurred by him to
enforce his rights under the agreement.
If the Internal Revenue Service subjects any payment to the named executive
officer under the change of control employment agreement to an excise tax under
Section 4999 of the Internal Revenue Code, such named executive officer will
receive an additional payment so that the amount he receives equals the amount
he would receive under the agreement if an excise tax had not been imposed.
However, this additional payment will not be made to such named executive
officer unless the payment exceeds 110% of the payments that could have been
made to him without the imposition of an excise tax.
The named executive officer will also receive any benefits he may have under any
other agreement with, or benefit plan or arrangement of, Comerica.
------------------------------
22
28
The following Compensation Committee Report and Performance Graph will not be
incorporated by reference into any of Comerica's previous filings under the
Securities Act of 1933, as amended, or the Exchange Act.
COMPENSATION COMMITTEE REPORT
Comerica establishes the annual compensation for Comerica's Chairman and Chief
Executive Officer based on the recommendation of the Compensation Committee to
the Board of Directors. The committee reviews and approves the annual
compensation for Comerica's President, Vice Chairman, Executive Vice Presidents
and other executive officers based on the recommendations of management. All the
members of the committee are non-employee directors.
COMPENSATION PHILOSOPHY
Comerica designed its compensation program to attract, motivate, reward and
retain superior executive talent. The program emphasizes performance-based
compensation and encourages long-term strategic decision making.
The principal components of the executive compensation program are base
salaries, annual and long-term management incentive awards and long-term stock
incentive awards.
In determining appropriate levels of compensation for the Chairman and Chief
Executive Officer, the President, the Vice Chairman, Executive Vice Presidents
and other executive officers, the committee evaluates: (1) Comerica's
performance in relation to established performance goals which are discussed
below; (2) Comerica's performance in relation to the fifty largest bank holding
companies in the United States (the "performance peer group"); and (3)
compensation levels at a selected group of fourteen super-regional bank holding
companies located primarily in the Midwest (the "compensation peer group").
The fifty largest bank holding companies included in the performance peer group
are substantially the same institutions as those included in the Keefe-50 Bank
Index used below in Comerica's performance graph, though there are some
differences.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Comerica's Board of Directors relies on the Chairman and Chief Executive Officer
to provide effective leadership and execute a successful business plan for the
entire organization. Other key measures of the Chairman and Chief Executive
Officer's performance include development of the senior managers of Comerica and
the leadership role he plays within the community.
Subject to the Board's approval of his annual compensation, the committee
establishes Mr. Miller's base salary, management incentive award, stock option
grants and, when appropriate, restricted stock awards in amounts commensurate
with his performance and position, in accordance with Comerica's compensation
philosophy described above and in accordance with the terms of Mr. Miller's
employment agreement discussed in this Proxy Statement under the heading
"Employment Contracts and Severance Agreements."
BASE SALARIES
In the fourth quarter of 1996, Comerica, with the assistance of an independent
compensation consultant, conducted a review of the competitiveness of the
executive compensation program. Based on this review, the Committee determined
that Comerica's base salaries for the named executive officers, including the
Chief Executive Officer, were at or above the median base salaries of the
compensation peer group. The committee increased Mr. Miller's base salary by
approximately four percent to reflect his contribution to the organization's
success and to maintain his base salary at a level competitive with that of
chief executive officers in the compensation peer group.
23
29
MANAGEMENT INCENTIVE PLAN
The committee members believe that return on equity is a key measure of
corporate performance. Therefore, Comerica maintains a Management Incentive Plan
for executive officers which provides for incentives that are driven by
Comerica's return on equity in relation to the performance peer group and in
relation to return on equity targets which are approved annually by the
committee.
For 1997, the payment of incentive awards was based on Comerica achieving a
minimum return on equity of fourteen percent. Maximum incentive awards become
payable when Comerica achieves a return on equity of nineteen percent or
greater. The Committee established these targets in the first quarter of 1997.
Upon determination of Comerica's performance in relation to these targets, the
committee established a pool of awards for distribution under the incentive
plan. The distribution of individual awards to the Chairman and Chief Executive
Officer and the other participants in the program is based on corporate
performance, individual performance and individual levels of responsibility
within Comerica. Mr. Miller's award under the plan also is subject to the terms
of his employment agreement.
The 1997 management incentive awards for the Chairman and Chief Executive
Officer and the other named executive officers were based on the 1997 return on
equity of 20.82 percent which placed Comerica (ranked at number seven), in the
top ten among the fifty largest bank holding companies included in the
performance peer group. Comerica determined the reported return on equity by
including an adjustment equal to twenty percent of the 1996 after-tax
restructuring charge.
Mr. Miller's 1997 annual award under the Management Incentive Plan reflects
Comerica's return on equity performance as well as Mr. Miller's contribution to
that performance. Mr. Miller's 1997 annual cash compensation, which includes
this award and his base salary, is approximately at the 75th percentile for the
compensation peer group.
To reward consistent superior performance over a three-year period, the
Management Incentive Plan provides for an additional award to be paid if
Comerica's average return on equity for the most recent three-year period ranks
among the top twenty in the performance peer group. Comerica pays fifty percent
of the additional award in the form of non-transferable common stock and fifty
percent in cash. A non-transferability restriction is attached to any stock
grant which precludes the recipient from disposing of the stock prior to
retirement or other termination of employment. The stock portion of the
additional award serves to further align the interests of Comerica's senior
officers with those of the shareholders.
Comerica's average return on equity for the three-year period from 1995 through
1997 ranked among the top ten of the fifty largest bank holding companies in the
performance peer group. This is the second time since the inception of the plan
that a long term incentive award was made to reward for this consistent superior
performance. Mr. Miller's long term incentive payment was based on his level and
contribution to this success.
STOCK-BASED AWARDS
Comerica's key officers and employees, including all of its named executive
officers, are eligible to receive stock-based awards under Comerica's Long-Term
Incentive Plan. The plan's objective is to align the interests of Comerica's key
officers and employees with those of its shareholders.
Awards in 1997 consisted principally of stock option grants with exercise prices
equal to the fair market value of Comerica's common stock on the grant date.
Because executives receive value from stock option grants only in the event of
stock price appreciation, the committee believes stock options are a strong
incentive to improve long term financial performance and increase shareholder
value. Individual grants in 1997 were based on corporate performance and on
individual levels of responsibility and contributions to Comerica.
24
30
Comerica's independent compensation consultant reported that, since 1992, the
size of Comerica's stock option grants for the named executive officers has been
conservative when compared to those for Comerica's compensation peer group. It
has been the goal of Comerica to provide stock-based awards at least equal to
the median awards provided by banks of this peer group. It is also a goal of
Comerica to encourage stock ownership for all levels of employees.
Grants of stock options to the Chairman and Chief Executive Officer and the
other named executive officers are allocated from a pool of options which is
created each year based on: (1) Comerica's overall performance and (2) a
percentage of each officer's base salary. Each named executive officer's grant
from the stock pool is based on the committee's assessment of his or her
individual performance.
STOCK OWNERSHIP GUIDELINES
Effective January 1, 1995, Comerica implemented stock ownership guidelines which
encourage senior officers to own a significant number of shares of Comerica's
common stock. The stock ownership targets require Comerica's senior officers to
own a number of shares with a value equal to the senior officer's annual salary
times a certain multiple. Comerica encourages its senior officers to achieve the
targeted stock ownership levels within five years of January 1, 1995 or of
becoming a senior officer. The Chairman and Chief Executive Officer, President,
Vice Chairman and every executive officer who has been an Executive Vice
President for five years have met their respective stock ownership targets.
STOCK OWNERSHIP TARGETS
[CAPTION]
MULTIPLE OF
ANNUAL YEARS TO
LEVEL SALARY ATTAIN
Chairman and Chief Executive Officer 5.0 times 5 Years
President 3.5 times 5 Years
Vice Chairman 3.0 times 5 Years
Executive Vice President 3.0 times 5 Years
Senior Vice President 2.0 times 5 Years
First Vice President 1.0 time 5 Years
DEDUCTIBILITY OF EXECUTIVE COMPENSATION
The committee's objective is to structure Comerica's executive compensation
programs to maximize the deductibility of executive compensation under the
Internal Revenue Code. However, the committee reserves the right in the exercise
of its business judgment to establish appropriate compensation levels for
executive officers that may exceed the limits on tax deductibility established
under Section 162(m) of the Internal Revenue Code. Currently all executive
officer compensation is tax deductible.
THE COMPENSATION COMMITTEE
Wayne B. Lyon, Chairman
Max M. Fisher
Alfred A. Piergallini
Martin D. Walker
25
31
PERFORMANCE GRAPH
The performance shown on the graph below is not necessarily indicative of future
performance.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG COMERICA INCORPORATED, KEEFE 50-BANK INDEX AND S&P 500 INDEX
(ASSUMES $100 INVESTED ON 12/31/92 AND REINVESTMENT OF DIVIDENDS)
MEASUREMENT PERIOD
(FISCAL YEAR COVERED) COMERICA KEEFE S&P 500
1992 100 100 100
1993 86 106 110
1994 83 100 112
1995 141 160 153
1996 191 227 189
1997 338 332 252
26
32
INDEPENDENT ACCOUNTANT
Upon recommendation of the Audit and Legal Committee, the Board of Directors
selected Ernst & Young LLP as independent accountant to audit Comerica's
financial statements for 1998. Ernst & Young also audited Comerica's financial
statements for 1997. Representatives of Ernst & Young will attend the Annual
Meeting and you may ask questions of Ernst & Young if you wish.
SHAREHOLDER PROPOSALS
If you would like Comerica to consider a proposal for inclusion in Comerica's
Proxy Statement for the 1999 Annual Meeting of Shareholders, you must ensure
that Comerica receives the proposal no later than December 11, 1998. Proposals
must comply with applicable laws and regulations and you must mail the proposal
to Comerica by certified or registered mail to the Corporate Secretary, Comerica
Incorporated, Comerica Tower at Detroit Center, 500 Woodward Avenue, 33rd Floor,
Detroit, Michigan 48226.
ANNUAL REPORT TO SHAREHOLDERS
Comerica mailed to you the 1997 Annual Report to Shareholders, containing
financial statements and other information about the operations of Comerica for
the year ended December 31, 1997. You should not regard the 1997 Annual Report
as proxy soliciting material.
OTHER MATTERS
The Board of Directors is not aware of any other matter to be presented at the
Annual Meeting. The Board of Directors does not intend to submit any additional
matters for a vote at the meeting and no shareholder has provided the required
notice of the shareholder's intention to propose any matter at the meeting.
Under Comerica's bylaws, the Board of Directors may, without notice, properly
submit additional matters for a vote at the meeting. If the Board of Directors
does so, the shares represented by Proxies in the accompanying form will be
voted with respect to the matter in accordance with the judgment of the person
or persons voting the shares.
Under Comerica's bylaws, shareholders of Comerica must provide advance notice to
Comerica if they wish to nominate persons for election as directors or propose
items of business at an annual meeting of Comerica's shareholders. In the case
of an annual meeting of shareholders, the shareholder must deliver this notice
not less than 60 days nor more than 90 days prior to the anniversary date of the
immediately preceding annual meeting of shareholders. If, however, Comerica
calls the annual meeting of shareholders for a date that is not within 30 days
before or after this anniversary date, Comerica must receive the shareholder's
notice not later than the close of business on the 10th day following the day on
which notice of the date of the annual meeting was mailed or public disclosure
of the date of the annual meeting was made, whichever occurs first. In the case
of a special meeting of shareholders called for the purpose of electing
directors, the shareholder's written notice must be delivered not later than the
close of business on the 10th day following the day on which notice of the date
of the special meeting was mailed or public disclosure of the date of the
special meeting was made, whichever occurs first. Any
27
33
shareholder may receive a copy of Comerica's bylaws specifying the advance
notice requirements by making a written request to the undersigned Corporate
Secretary of Comerica.
By Order of the Board of Directors,
GEORGE W. MADISON
George W. Madison
Executive Vice President,
General Counsel and Corporate
Secretary
April 10, 1998
28
34
APPENDIX A
AMENDMENT TO
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF
COMERICA INCORPORATED
(the "Corporation")
Paragraph FOURTH is hereby amended and restated to read as follows:
FOURTH
The total number of shares of all classes of stock which the Corporation shall
have authority to issue is 335,000,000 shares which shall be divided into two
classes as follows:
(a) 10,000,000 shares of Preferred Stock without par value (Preferred
Stock); and
(b) 325,000,000 shares of Common Stock of the par value of $5.00 per share
(Common Stock).
The designations and the powers, preferences and relative, participating,
optional or other special rights, and the qualifications, limitations or
restrictions of the above classes of stock shall be as follows:
PART I: PREFERRED STOCK
(a) Shares of Preferred Stock may be issued in one or more series at such time
or times and for such consideration or considerations as the Board of Directors
may determine.
(b) The Board of Directors is expressly authorized at any time, and from time
to time, to provide for the issuance of shares of Preferred Stock in one or more
series, with such voting powers, full or limited but not to exceed one vote per
share, or without voting powers, and with such designations, preferences and
relative, participating, optional or other special rights, and qualifications,
limitations or restriction thereof, as shall be stated and expressed in the
resolution or resolutions providing for the issue thereof adopted by the Board
of Directors, and as are not stated and expressed in this Restated Certificate
of Incorporation, or any amendment thereto, including (but without limiting the
generality of the foregoing) the following:
(i) The designation of such series and number of shares comprising such
series, which number may (except where otherwise provided by the
Board of Directors in creating such series) be increased or decreased
(but not below the number of shares then outstanding) from time to
time by action of the Board of Directors.
(ii) The dividend rate or rates on the shares of such series and the
preference or relation which such dividends shall bear to the
dividends payable on any other class of capital stock or on any
other series of Preferred Stock, the terms and conditions upon which
and the periods in respect of which dividends shall be payable,
whether and upon what condition such dividends shall be cumulative
and, if cumulative, the date or dates from which dividends shall
accumulate.
(iii) Whether the shares of such series shall be redeemable, and, if
redeemable, whether redeemable for cash, property or rights,
including securities of any other corporations, at the option of
either the holder or the Corporation or upon the happening of a
specified event, the limitations and restrictions with respect to
such redemption, the time or times when, the price or prices or rate
or rates at which, the adjustments with which and the manner in
which such shares shall be redeemable, including the manner
A-1
35
of selection shares of such series for redemption if less than all
shares are to be redeemed.
(iv) The rights to which the holders of shares of such series shall be
entitled, and the preferences, if any, over any other series (or of
any other series over such series), upon the voluntary or involuntary
liquidation, dissolution, distribution or winding up of the
Corporation, which rights may vary depending on whether such
liquidation, dissolution, distribution or winding up is voluntary or
involuntary, and, if voluntary, may vary at different dates.
(v) Whether the shares of such series shall be subject to the operation of
a purchase, retirement or sinking fund, and, if so, whether and upon
what conditions such purchase, retirement or sinking fund shall be
cumulative or noncumulative, the extent to which and the manner in
which such fund shall be applied to the purchase or redemption of the
shares of such series for retirement or to other corporate purposes
and the terms and provisions relative to the operation thereof.
(vi) Whether the shares of such series shall be convertible into, or
exchangeable for, at the option of either the holder or the
Corporation or upon the happening of a specified event, shares of any
other class or of any other series of any class of capital stock of
the Corporation, and, if so convertible or exchangeable, the times,
prices, rates, adjustments, and other terms and conditions of such
conversion or exchange.
(vii) The voting powers, full and/or limited, if any, of the shares of
such series, and whether and under what conditions the shares of
such series (alone or together with the shares of one or more other
series having similar Provisions) shall be entitled to vote
separately as a single class, for the election of one or more
directors, or additional directors, of the Corporation in case of
dividend arrearages or other specified events, or upon other
matters.
(viii) Whether the issuance of any additional shares of such series, or of
any shares of any other series, shall be subject to restrictions as
to issuance, or as to the powers, preferences or rights of any such
other series.
(ix) Any other preferences, privileges and powers and relative,
participating, option or other special rights, and qualifications,
limitations or restrictions of such series, as the Board of Directors
may deem advisable and as shall not be inconsistent with the
provisions of this Restated Certificate of Incorporation.
(c) Unless and except to the extent otherwise required by law or provided in
the resolution or resolutions of the Board of Directors creating any series of
Preferred Stock pursuant to this Part I, the holders of the Preferred Stock
shall have no voting power with respect to any matter whatsoever. In no event
shall the Preferred Stock be entitled to more than one vote in respect of each
share of stock.
(d) Shares of Preferred Stock redeemed, converted, exchanged, purchased,
retired or surrendered to the Corporation, or which have been issued and
reacquired in any manner, may, upon compliance with any applicable provisions of
the General Corporation Law of the State of Delaware, be given the status of
authorized and unissued shares of Preferred Stock and may be reissued by the
Board of Directors as part of the series of which they were originally a part or
may be reclassified into and reissued as part of a new series or as a part of
any other series, all subject to the protective conditions or restrictions of
any outstanding series of Preferred Stock.
A-2
36
PART II: COMMON STOCK
(a) Except as otherwise required by law or by any amendment to this Restated
Certificate of Incorporation, each holder of Common Stock shall have one vote
for each share of stock held by him of record on the books of the Corporation on
all matters voted upon by the stockholders.
(b) Subject to the preferential dividend rights, if any, applicable to shares
of Preferred Stock and subject to applicable requirements, if any, with respect
to the setting aside of sums for purchase, retirement or sinking funds for
Preferred Stock, the holders of Common Stock shall be entitled to receive, to
the extent permitted by law, such dividends as may be declared from time to time
by the Board of Directors.
(c) In the event of the voluntary or involuntary liquidation, dissolution,
distribution of assets or winding up of the Corporation, after distribution in
full of the preferential amounts, if any, to be distributed to the holders of
shares of Preferred Stock, holders of Common Stock shall be entitled to receive
all of the remaining assets of the Corporation of whatever kind available for
distribution to stockholders ratably in proportion to the number of shares of
Common Stock held by them respectively. The Board of Directors may distribute in
kind to the holders of Common Stock such remaining assets of the Corporation or
may sell, transfer or otherwise dispose of all or any part of such remaining
assets to any other corporation, trust or entity, or any combination thereof,
and may sell all or any part of the consideration so received and distribute any
balance thereof in kind to holders of Common Stock. The merger or consolidation
of the Corporation into or with any other corporation, or the merger of any
other corporation into it, or any purchase or redemption of shares of stock of
the Corporation of any class, shall not be deemed to be a dissolution,
liquidation of winding up of the Corporation for the purposes of this paragraph.
(d) Such numbers of shares of Common Stock as may from time to time be required
for such purpose shall be reserved for issuance (i) upon conversion of any
shares of Preferred Stock or any obligation of the Corporation convertible into
shares of Common Stock which is at the time outstanding or issuable upon
exercise of any options or warrants at the time outstanding and (ii) upon
exercise of any options, warrants or rights at the time outstanding to purchase
shares of Common Stock.
A-3
37
Location of Comerica Incorporated
Annual Meeting of Shareholders
RENAISSANCE CONFERENCE CENTER
TOWER 300, LEVEL L2
COMERICA MAP
ADJACENT PARKING FACILITY
CENTER GARAGE
Use the Renaissance Drive entrance. Take the garage elevator to Level 5, then
take the Bridge to the Renaissance Center. Follow the signs to Comerica's Annual
Meeting.
Comerica has reserved a limited number of spaces in the Center Garage for use by
its shareholders during the Annual Meeting. Shareholders who attend the Annual
Meeting may use such spaces on a first come, first serve basis. Comerica will
reimburse shareholders, who park at the Center Garage during the Annual Meeting,
the cost of parking.
38
COMERICA LOGO
COMERICA INCORPORATED
1998 ANNUAL MEETING OF STOCKHOLDERS
MAY 15, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned appoints Mark W. Yonkman and Carol H. Rodriguez as Proxies,
each with the power to appoint his or her substitute, and authorizes them to
represent and vote, as designated below, all the shares of common stock of
Comerica Incorporated held of record by the undersigned on March 23, 1998, at
the annual meeting of shareholders to be held on May 15, 1998 and any
adjournment of the meeting. In their discretion, the Proxies are authorized to
vote upon any other business that may properly come before the meeting.
1. ELECTION OF DIRECTORS [ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote for
(except as marked to the contrary) all nominees listed below
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH THE NOMINEE'S NAME.
James F. Cordes Eugene A. Miller Martin D. Walker Kenneth L. Way
2. APPROVE ADOPTION OF THE AMENDMENT TO COMERICA INCORPORATED CERTIFICATE OF INCORPORATION TO INCREASE
THE NUMBER OF SHARES OF COMMON STOCK WHICH COMERICA IS AUTHORIZED TO ISSUE FROM 250,000,000 TO 325,000,000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PLEASE SIGN AND DATE THE REVERSE SIDE BEFORE MAILING
39
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER SPECIFIED BY THE
UNDERSIGNED SHAREHOLDER. IF NO INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE
VOTED FOR THE MATTERS LISTED.
Please sign exactly as the name appears below. When shares are held by joint
tenants, both should sign. Please give full title when signing as attorney,
executor, administrator, trustee or guardian. 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.
COMERICA INCORPORATED Dated:
ANNUAL MEETING OF SHAREHOLDERS --------------------, 1998
MAY 15, 1998
9:30 A.M. --------------------------------
Signature
Renaissance Conference Center
Level 2, Tower 300 of Renaissance Center --------------------------------
Detroit, Michigan Signature (if held jointly)
PLEASE SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE
40
COMERICA LOGO
COMERICA INCORPORATED
1998 ANNUAL MEETING OF STOCKHOLDERS
MAY 15, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned appoints Mark W. Yonkman and Carol H. Rodriguez as Proxies,
each with the power to appoint his or her substitute, and authorizes them to
represent and vote, as designated below, all the shares of common stock of
Comerica Incorporated held of record by the undersigned on March 23, 1998, at
the annual meeting of shareholders to be held on May 15, 1998 and any
adjournment of the meeting. In their discretion, the Proxies are authorized to
vote upon any other business that may properly come before the meeting.
1. ELECTION OF DIRECTORS [ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote for
(except as marked to the contrary) all nominees listed below
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH THE NOMINEE'S NAME.
James F. Cordes Eugene A. Miller Martin D. Walker Kenneth L. Way
2. APPROVE ADOPTION OF THE AMENDMENT TO COMERICA INCORPORATED CERTIFICATE OF INCORPORATION TO INCREASE
THE NUMBER OF SHARES OF COMMON STOCK WHICH COMERICA IS AUTHORIZED TO ISSUE FROM 250,000,000 TO 325,000,000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PLEASE SIGN AND DATE THE REVERSE SIDE BEFORE MAILING
OR
SEE THE INSTRUCTIONS ON THE REVERSE SIDE TO VOTE BY TELEPHONE
41
VOTE BY TELEPHONE Company #
QUICK *** EASY *** IMMEDIATE Control #
CALL TOLL FREE *** ON A TOUCH TONE TELEPHONE
1-800-240-6326 - ANYTIME
- --------------------------------------------------------------------------------
Your telephone vote authorizes the named proxies to vote your shares in the
same manner as if you marked, signed and returned your proxy card. The
deadline for telephone voting is noon (Eastern Daylight Savings Time), May 13,
1998
1. Using a touch-tone telephone, dial 1-800-240-6326. You may dial this toll
free number at your convenience 7 days/week, 24 hrs/day.
2. When prompted, enter the 3 digit Company Number located in the box on the
upper right hand corner of the proxy card.
3. When prompted, enter our 7 digit numeric Control Number that follows the
company number.
OPTION #1: To grant a proxy to vote as the COMERICA INCORPORATED Board of
Directors recommends on ALL proposals: Press 1
When asked, please confirm your vote by pressing 1 - THANK YOU
FOR VOTING
OPTION #2: If you choose to grant a proxy to vote on each proposal separately,
Press 0. You will hear these instructions:
Proposal 1: To grant a proxy to vote FOR ALL nominees, press 1;
To WITHHOLD FOR ALL nominees, press 9;
To WITHHOLD FOR AN INDIVIDUAL nominee, Press 0 and
listen to the instructions.
Proposal 2: To grant a proxy to vote FOR, press 1; AGAINST, press
9; ABSTAIN, press 0.
The instructions are the same for all remaining proposals.
When asked, please confirm your vote by pressing 1 - THANK YOU FOR AUTHORIZING
PROXY HOLDERS TO VOTE YOUR SHARES
USING THESE TELEPHONE PROCEDURES.
IF YOU VOTE BY TELEPHONE, DO NOT MAIL YOUR PROXY.
PLEASE DETACH HERE
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER SPECIFIED BY THE
UNDERSIGNED SHAREHOLDER. IF NO INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE
VOTED FOR THE MATTERS LISTED.
Please sign exactly as the name appears below. When shares are held by joint
tenants, both should sign. Please give full title when signing as attorney,
executor, administrator, trustee or guardian. 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.
COMERICA INCORPORATED Dated:
ANNUAL MEETING OF SHAREHOLDERS --------------------, 1998
MAY 15, 1998
9:30 A.M. --------------------------------
Signature
Renaissance Conference Center
Level 2, Tower 300 of Renaissance Center --------------------------------
Detroit, Michigan Signature (if held jointly)
PLEASE SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE
OR
SEE THE INSTRUCTIONS ABOVE TO
VOTE BY TELEPHONE