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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:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of
the Commission Only (as
permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Metropolitan Financial Corp.
--------------------------------------------------
(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)(1) 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:
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[Metropolitan Logo]
METROPOLITAN FINANCIAL CORP.
6001 Landerhaven Drive
Mayfield Heights, Ohio 44124
April 10, 1997
Dear Shareholder:
On behalf of the Board of Directors, I cordially invite you to attend
the 1997 Annual Meeting of Shareholders of Metropolitan Financial Corp., which
will be held at our executive offices, 6001 Landerhaven Drive, Mayfield Heights,
Ohio, at 11:00 a.m., local time, on Tuesday, May 20, 1997.
All holders of record of shares of Common Stock of Metropolitan
Financial Corp. as of March 27, 1997, are entitled to vote at the 1997 Annual
Meeting.
As described in the accompanying Notice and Proxy Statement, you will be
asked to vote on the election of three directors for three-year terms expiring
in 2000 and to ratify the appointment of independent auditors for 1997.
The accompanying Notice and Proxy Statement and the Annual Report for
the year ended December 31, 1996, are being mailed to shareholders on or about
April 10, 1997.
Your vote is very important, regardless of the number of shares you own.
I urge you to complete, sign, and date each proxy card you receive and return it
as soon as possible in the postage-paid envelope provided, even if you currently
plan to attend the 1997 Annual Meeting. This will not prevent you from voting in
person, but will assure that your vote is counted if you are unable to attend
the meeting. Thank you for your consideration of these matters and please vote
today.
Sincerely,
/s/ Robert M. Kaye
ROBERT M. KAYE
Chairman of the Board
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[Metropolitan Logo]
METROPOLITAN FINANCIAL CORP.
6001 Landerhaven Drive
Mayfield Heights, Ohio 44124
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 20, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
Metropolitan Financial Corp. will be held at 6001 Landerhaven Drive, Mayfield
Heights, Ohio, on Tuesday, May 20, 1997, at 11:00 a.m., local time, for the
following purposes:
1. To elect three directors to serve for terms expiring in 2000.
2. To ratify the appointment of Crowe, Chizek and Company LLP as
Metropolitan Financial Corp.'s independent auditors for the fiscal year ending
December 31, 1997.
3. To transact such other business as may properly come before the
1997 Annual Meeting or any postponement or adjournment thereof.
The Board of Directors has selected March 27, 1997, as the record date
for the Annual Meeting. Only those shareholders of record at the close of
business on that date will be entitled to notice of and to vote at the 1997
Annual Meeting or any postponement or adjournment thereof.
By Order of the Board of Directors
/s/ Malvin E. Bank
MALVIN E. BANK
Secretary
April 10, 1997
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[Metropolitan Logo]
METROPOLITAN FINANCIAL CORP.
6001 Landerhaven Drive
Mayfield Heights, Ohio 44124
---------------------------
PROXY STATEMENT
---------------------------
INFORMATION RELATING TO VOTING AT THE ANNUAL MEETING
This Proxy Statement is furnished to shareholders of Metropolitan
Financial Corp. ("Metropolitan" or the "Corporation") in connection with the
solicitation on behalf of the Corporation's Board of Directors of proxies to be
voted at the 1997 Annual Meeting of Shareholders of Metropolitan (the "1997
Annual Meeting") to be held at 6001 Landerhaven Drive, Mayfield Heights, Ohio on
Tuesday, May 20, 1997, and at any postponement or adjournment thereof. The
approximate date of mailing of this Proxy Statement and the accompanying form of
proxy is April 10, 1997.
The Board of Directors of Metropolitan has selected March 27, 1997 as
the record date for the determination of shareholders entitled to notice of and
to vote at the 1997 Annual Meeting. A total of 3,525,635 shares of Common Stock,
without par value, of the Corporation (the "Common Shares"), were outstanding at
the close of business on that date. Shareholders will be entitled to cast one
vote for each Common Share held by them of record at the close of business on
the record date on each matter to be considered at the 1997 Annual Meeting.
ELECTION OF DIRECTORS
In accordance with Metropolitan's Amended and Restated Code of
Regulations (the "Regulations"), the Board of Directors has established the size
of the Board at 11 members, divided into two classes of four members and one
class of three members. The terms of the three classes as of the 1997 Annual
Meeting will expire in 1998, 1999 and 2000, respectively. Proxies solicited by
the Board of Directors will be voted for each of the nominees listed below
unless the shareholder specifies otherwise in the proxy. At the election of
directors, the properly nominated candidates receiving the greatest number of
votes shall be elected.
Three nominees for terms expiring in 2000 are listed below. Each of the
nominees is currently a director of the Corporation, and each has indicated his
or her willingness to serve if reelected. If any nominee becomes unable to
accept nomination or election, the proxy cards (unless a contrary specification
is properly made on the proxy card) will be voted for the election of such other
person, if any, as shall be recommended by the Board of Directors or for holding
a vacancy to be filled by the Board at a later date.
The following table sets forth the names of and certain information,
including any positions held with Metropolitan Savings Bank of Cleveland (the
"Bank"), a wholly-owned subsidiary of the Corporation, with respect to the
three nominees for director and directors whose term of office will continue
after the 1997 Annual Meeting. All persons who serve as directors of the
Corporation also serve as directors of the Bank.
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FOR TERM POSITIONS CURRENTLY HELD
DIRECTOR TO WITH METROPOLITAN AND
NOMINEES FOR DIRECTOR AGE SINCE EXPIRE THE BANK
- --------------------- --- ----- ------ ------------------------
Lois K. Goodman 63 1994 2000 Director of Metropolitan and
the Bank
Marguerite B. Humphrey 55 1994 2000 Director of Metropolitan and
the Bank
Alfonse M. Mattia 55 1996 2000 Director of Metropolitan and
the Bank
POSITIONS CURRENTLY HELD
DIRECTOR TERM WITH METROPOLITAN AND
CONTINUING DIRECTORS AGE SINCE EXPIRING THE BANK
- -------------------- --- ----- -------- -------------------------
Robert M. Kaye 60 1987 1999 Chairman of Metropolitan and
Chairman of the Bank
David G. Lodge 57 1991 1999 President, Assistant Secretary,
Assistant Treasurer and Director
of Metropolitan and President and
Director of the Bank
Malvin E. Bank 66 1991 1999 Secretary, Assistant Treasurer
and Director of Metropolitan
and Secretary and Director of the
Bank
David P. Miller 64 1992 1999 Treasurer, Assistant Secretary and
Director of Metropolitan
and Director of the Bank
Ralph D. Ketchum 71 1991 1998 Director of Metropolitan and
the Bank
James A. Karman 59 1992 1998 Director of Metropolitan and
the Bank
Robert R. Broadbent 75 1992 1998 Director of Metropolitan and
the Bank
Marjorie M. Carlson 56 1994 1998 Director of Metropolitan and
<FN> the Bank
------------
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS ELECTION OF THE
ABOVE NOMINEES FOR DIRECTOR.
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During the past five years, the business experience of each of the
directors and executive officers has been as follows:
NOMINEES
Ms. Goodman has served as a Director of Metropolitan and the Bank since
1994. Since 1991, she has been President of the Work & Family Consulting Group,
Inc., a consulting service for employers on managing working families. Ms.
Goodman is also a member of the Board of Trustees for the Cleveland Opera,
the Jewish Community Federation, Starting Point and Eldred Theater.
Ms. Humphrey has served as a Director of Metropolitan and the Bank
since 1994. Ms. Humphrey developed and implemented workshops for trustee
education for the Cultural Arts Trustee Forum at the Cleveland Mandel Center
from 1992 to 1995. She is a trustee for the American Symphony Orchestra League,
the Cleveland Institute of Music, the Musical Arts Association, Rainbow Babies
and Children's Hospital and the Cleveland Zoological Society.
Mr. Mattia has served as a consultant to the Bank since 1987 and as a
Director of Metropolitan and the Bank since 1996. Mr. Mattia is a CPA and a
founding partner of Amper, Politziner & Mattia, a New Jersey-based accounting
and consulting firm. Mr. Mattia serves on the Quality Assurance Committee of the
AICPA and is co-Chairman of the Rutgers University Family Business Forum.
CONTINUING DIRECTORS
Mr. Kaye has served as Chairman of Metropolitan and the Bank since
1987. He has also served as President of Planned Residential Communities, Inc.
since 1960. Planned Residential Communities, Inc. is actively engaged in every
aspect of multifamily housing from new construction and rehabilitation to
acquisition and management. He has also been a member of the Corporate Council
of the Cleveland Museum of Art since its inception in 1993 and has been a member
of the Board of Trustees of the College of New Jersey since 1980 and of The
Peddie School since 1988.
Mr. Lodge joined Metropolitan in December 1988 as Executive Vice
President. He has served as President of Metropolitan and the Bank since August
1991. Mr. Lodge has also served as Director of Metropolitan and the Bank since
1991 and as Assistant Secretary and Assistant Treasurer of Metropolitan since
1992. Mr. Lodge has served as a Director of University Circle Incorporated and
Vocational Guidance Services since 1994 and became a member of the Board of
Trustees of The Cleveland Playhouse in June 1995.
Mr. Bank has served as a Director and as Secretary of Metropolitan and
the Bank since 1991. Mr. Bank also serves as Assistant Treasurer of
Metropolitan. Mr. Bank is a senior partner with the Cleveland law firm of
Thompson Hine & Flory LLP. Mr. Bank also serves as a Director of Oglebay Norton
Company.
Mr. Miller has served as a Director of Metropolitan and the Bank since
1992. Mr. Miller also serves as Treasurer and Assistant Secretary of
Metropolitan. Since 1986, Mr. Miller has been the Chairman and Chief Executive
Officer of Columbia National Group, Inc., a Cleveland-based scrap and waste
materials wholesaler and steel manufacturer. He is currently commissioner of the
Ohio Lottery.
Mr. Ketchum has served as a Director of Metropolitan and the Bank since
1991. Since 1987, Mr. Ketchum has been President of RDK Capital Inc., a general
partner in a partnership formed for the purposes of acquiring and managing
companies serving the aircraft industry. Prior thereto, he was a Senior Vice
President and Group Executive for the General Electric Company, Lighting Group.
Mr.
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Ketchum is also a member of the Board of Directors of Oglebay Norton Company,
Thomas Industries, Pacific Scientific and Lithium Technology Corp.
Mr. Karman has served as a Director of Metropolitan and the Bank since
1992. Mr. Karman has been affiliated with RPM, Inc. since 1963, and in 1978 he
became President of RPM, Inc., a manufacturer of protective coatings, sealants
and specialty chemicals. Mr. Karman serves as a member of the Board of Directors
of RPM, Inc., McDonald & Company Investments, Inc., A. Schulman, Inc. and Shiloh
Industries, Inc. Mr. Karman also serves as a member of the Board of Trustees
of the Musical Arts Association, the Boys & Girls Club of Cleveland, Hiram
College and Boys Hope, and is a member of the Corporate Council, Cleveland
Museum of Art.
Mr. Broadbent has served as a Director of Metropolitan and the Bank
since 1992. From 1984 to 1989, Mr. Broadbent served as Chairman and Chief
Executive Officer of The Higbee Company, a Cleveland-based clothing and
housewares retailer. Mr. Broadbent served as the Chairman of the Rock and Roll
Hall of Fame Museum, Inc. until May 1994 and is now on the advisory board. Mr.
Broadbent also serves as a Director of PICO Holding, Inc., as well as a Trustee
of the Murphy Foundation.
Ms. Carlson has served as a Director of Metropolitan and the Bank
since 1994. She also is the Director of Development for the Cleveland
Foundation. Ms. Carlson is a member of the Board of Trustees of the College of
Wooster, the Musical Arts Association, the Playhouse Square Foundation, and is a
Director of the National Committee on Planned Giving.
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Patrick W. Bevack, 50, has been Executive Vice President of the Bank
since May 1992. Mr. Bevack became Treasurer and Assistant Secretary of the Bank
in 1993. Prior to joining Metropolitan, Mr. Bevack was Executive Vice President
of TransOhio Savings Bank.
Michael DiAsio, 33, joined Metropolitan in 1990 as a commercial loan
underwriter. Later, Mr. DiAsio was named Vice President of Commercial Real
Estate Lending, and in September of 1996, he was promoted to the position of
Senior Vice President. Prior to joining Metropolitan, he was Manager of
Commercial Real Estate Lending for County Savings Bank of Columbus, Ohio.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Corporation has regular quarterly
meetings and held three meetings in 1996. No director attended fewer than 75% of
the total number of meetings of the Board of Directors of the Corporation during
the periods that he or she served in 1996.
All persons who serve as directors of the Corporation also serve as
directors of the Bank. The Board of Directors of the Bank has regular monthly
meetings and held 12 meetings in 1996. The Board of Directors of the Bank has
established various committees to whom certain responsibilities have been
delegated, including an Audit Committee and a Compensation and Organization
Committee. No director attended fewer than 75% of the total number of meetings
of the Board of Directors of the Bank and meetings of committees of the Board of
the Bank on which he or she served during 1996.
The Compensation and Organization Committee of the Bank currently
consists of Messrs. Kaye, Bank, Ketchum and Karman. The Compensation and
Organization Committee is responsible for reviewing and recommending
compensation with respect to Mr. Kaye and Mr. Lodge. The Compensation and
Organization Committee held three meetings in 1996.
- 4 -
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The Audit Committee of the Bank consists of Messrs. Bank, Miller,
Ketchum, Karman, Mattia and Broadbent and Ms. Humphrey. The Audit Committee
makes recommendations to the Board of Directors as to the engagement of
independent auditors to perform audit and non-audit services, reviews the scope
and results of their services, oversees the internal audit function, and reviews
the systems of internal control and audit with management and the independent
auditors. The Audit Committee held four meetings in 1996.
Neither Metropolitan nor the Bank have a standing nominating committee
of the Board of Directors (or another standing committee performing similar
functions). Metropolitan's Regulations provide that only persons nominated in
accordance with the procedures set forth therein shall be eligible for election
as directors. Shareholder nominations must be made pursuant to written notice
received by the Corporation not less than 60 days nor more than 90 days prior to
the meeting, provided, however, that in the event that less than 75 days' notice
to the shareholders or prior public disclosure of the date of the meeting is
given or made, the written notice of such shareholder's intent to make such
nomination must be given to the Secretary not later than the close of business
on the fifteenth day following the earlier of the day on which such notice of
the date of the meeting was mailed or such public disclosure was made. Any
shareholder recommendation for a director nominee should contain background
information concerning the recommended nominee, including, (a) the name, age,
business, and residence address of such person; (b) the principal occupation or
employment of such person for the last five years; (c) the class and number of
Metropolitan Common Shares that are beneficially owned by such person; (d) all
positions of such person as a director, officer, partner, employee or
controlling shareholder of any corporation or other business entity; (e) any
prior position as a director, officer or employee of a depository institution
or any company controlling a depository institution; (f) certain information
relating to such person which would be required to be disclosed in a proxy
statement; and (g) the written consent of such individual to serve if nominated
or elected. Any shareholder recommendation should also include, as to the
shareholder giving the written notice, (a) the name and record address of such
shareholder; (b) a representation that the shareholder is a holder of record of
shares of Metropolitan entitled to vote at such meeting; (c) a description of
all arrangements or understandings between the shareholder and such recommended
person and any other person or persons (naming such person or persons); and (d)
the class and number of Metropolitan Common Shares beneficially owned by the
nominating shareholder.
DIRECTOR COMPENSATION
For their services as directors, each member of the Board of Directors
of the Bank who is not an employee of Metropolitan or the Bank receives a
monthly consulting fee of $1,000. The Chairman of the Board of the Bank and all
other members of the Board of the Bank, who are not employees of Metropolitan or
the Bank, receive a $250 attendance fee for each meeting of the Board attended.
Beginning in May of 1997, the attendance fee for each meeting of the Board of
Directors will be increased to $500. Members of the Board of Directors of
Metropolitan receive no fees for their services as such.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of Metropolitan's Board of Directors consists
of Messrs. Kaye, Bank, Ketchum and Karman.
Mr. Kaye, the Chairman of the Board, is the sole shareholder of Planned
Residential Communities, Inc. which receives a $96,000 annual fee for employee
benefit related services and multifamily property consulting services provided
to Metropolitan.
- 5 -
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The law firm of Thompson Hine & Flory LLP, of which Malvin E. Bank is a
partner, provided legal services to Metropolitan in 1996 and during the current
fiscal year.
Several of the directors and executive officers of Metropolitan
purchased subordinated notes from Metropolitan during the Corporation's 1993
private offering of 10% subordinated notes maturing December 31, 2001 (the "1993
Subordinated Notes"). These purchases were made on the same terms and at the
same prices offered to unaffiliated investors. Mr. Kaye holds $515,000 principal
amount of 1993 Subordinated Notes and Mr. Ketchum holds $200,000 principal
amount of 1993 Subordinated Notes.
CERTAIN TRANSACTIONS
The accounting firm of Amper, Politziner & Mattia, of which Alfonse M.
Mattia is a partner, provided tax services to Metropolitan in 1996 and during
the current fiscal year.
As noted above, several of the directors and executive officers of
Metropolitan purchased 1993 Subordinated Notes from Metropolitan during the
private offering of the 1993 Subordinated Notes. These purchases were made on
the same terms and at the same prices offered to unaffiliated investors. David
Miller holds $200,000 principal amount of 1993 Subordinated Notes. In addition,
the Metropolitan Savings Bank of Cleveland 401(k) Plan and the Planned
Residential Communities Management Co. Inc. and Affiliates 401(k) Plan jointly
own $400,000 principal amount of 1993 Subordinated Notes. The Amper, Politziner
& Mattia Profit Sharing Trust, of which Alfonse M. Mattia is a trustee, holds
$200,000 principal amount of 1993 Subordinated Notes.
The Bank has had, and expects to have in the future, banking
transactions in the ordinary course of business with Metropolitan's and the
Bank's directors, officers, shareholders and associates on substantially the
same terms, including interest rates and collateral on loans, as those
prevailing at the time for comparable transactions with other persons, and that
do not involve more than the normal risk of collectibility or present other
unfavorable terms.
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SECURITIES OWNERSHIP OF MANAGEMENT
The following table sets forth, as of March 3, 1997, information
concerning Metropolitan Common Shares beneficially owned by current directors of
and nominees for director of Metropolitan, executive officers included in the
Summary Compensation Table, and all directors, nominees for director and
executive officers of Metropolitan and the Bank as a group. Except as otherwise
noted, each beneficial owner listed has sole investment and voting power with
respect to the Common Shares indicated.
NAME OF INDIVIDUAL OR AMOUNT AND NATURE PERCENT
NUMBER OF PERSONS IN GROUP OF BENEFICIAL OWNERSHIP OF CLASS
- -------------------------- ----------------------- --------
Robert M. Kaye 2,730,635 77.5%
David G. Lodge 7,500 (1) *
Malvin E. Bank 7,500 *
David P. Miller 7,500 *
Ralph D. Ketchum 7,500 *
James A. Karman 2,500 *
Robert R. Broadbent 15,000 *
Marjorie M. Carlson 7,500 *
Lois K. Goodman 7,500 (2) *
Marguerite B. Humphrey 5,000 *
Alfonse M. Mattia 18,800 (3) *
Patrick W. Bevack 4,000 *
Michael DiAsio 0 *
All directors and executive officers as a group
(13 persons) 2,820,935 80.0%
<FN>
- --------------
(1) Total does not include 600 Common Shares held by Mr. Lodge's children
and 700 Common Shares held by Mr. Lodge's spouse, as to which Mr.
Lodge disclaims beneficial ownership.
(2) Total includes 4,000 Common Shares held by Ms. Goodman's husband, as
to which Ms. Goodman disclaims beneficial ownership.
(3) Total includes 8,200 Common Shares held in trust, for which Mr. Mattia
is a trustee with sole investment and voting power, and 300 Common Shares
held by Mr. Mattia's spouse, as to which Mr. Mattia disclaims beneficial
ownership.
* Represents less than 1% of Metropolitan's outstanding Common Shares.
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Except as set forth below, no person is known to Metropolitan at March
3, 1997 to own beneficially, within the meaning of the regulations of the
Securities and Exchange Commission, more than 5% of Metropolitan's outstanding
Common Shares.
NAME AND ADDRESS AMOUNT AND NATURE
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP PERCENT OF CLASS
- ------------------- ----------------------- ----------------
Robert M. Kaye 2,730,635 77.5%
6001 Landerhaven Drive
Mayfield Heights, Ohio 44124
- --------------
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CHANGE IN CONTROL
Metropolitan has a revolving credit agreement with The Huntington
National Bank (the "Huntington Loan Agreement"). The Huntington Loan Agreement
is a revolving line of credit for the first 24 month period and then it converts
to a 36 month term note. The maximum permitted borrowing amount is $4.0 million.
As collateral for the Huntington Loan Agreement, Mr. Kaye pledged a portion of
his Common Shares in an amount at least equal in value to 200% of any
outstanding balance. At March 3, 1997, there was no outstanding balance under
the Huntington Loan Agreement.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
COMPENSATION TABLE
The following table sets forth certain information with respect to
compensation provided by Metropolitan and its subsidiaries during the years
ended December 31, 1994, 1995 and 1996, to its Chief Executive Officer and
Metropolitan's other executive officers whose annual salary and bonus exceed
$100,000.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION
-------------------
NAME AND FISCAL YEAR ENDED ALL OTHER
PRINCIPAL POSITION DECEMBER 31 SALARY BONUS COMPENSATION(1)
------------------ ------------- ------ ----- ---------------
Robert M. Kaye, 1996 $295,000 $65,000(2) $4,750
Chairman of the 1995 255,000 --- 4,620
Board 1994 220,000 --- 4,620
David G. Lodge, 1996 205,000 65,000 4,750
President 1995 175,000 50,000 4,571
1994 150,000 40,000 4,620
Patrick W. Bevack, 1996 135,000 7,500 4,750
Executive Vice 1995 125,000 7,000 4,275
President(3) 1994 120,000 4,000 3,792
Michael DiAsio, 1996 86,650 41,270(5) 2,113
Senior Vice 1995 75,000 8,500 1,900
President(4) 1994 66,100 2,500 2,025
<FN>
- --------------------------------
(1) Represents the Bank's contribution to the Metropolitan Savings Bank of
Cleveland 401(K) Plan.
(2) Paid January 1997.
(3) Mr. Bevack is Executive Vice President, Treasurer and Assistant
Secretary of the Bank.
(4) Mr. DiAsio is Senior Vice President - Commercial Real Estate Lending
of the Bank.
(5) $24,825 paid January 1997 and remainder to be paid over a two-year
period beginning January 1, 1997 in increments of 20% paid every six
months in accordance with the terms of the Commercial Real Estate
Manager's Bonus Program.
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COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation and Organization Committee of the Board of Directors of
the Bank reviews all issues pertaining to the compensation of Mr. Kaye and Mr.
Lodge, the two executive officers of Metropolitan and the Bank. The Committee
submits its recommendations with regard to compensation to the full Board of
Directors of the Bank for approval.
As an overall evaluation tool used in setting the compensation for Mr.
Kaye and Mr. Lodge, the Committee reviews a Bank Compensation Survey prepared
annually by the accounting firm of Crowe Chizek and Company LLP. By studying
this report, the Committee is able to review compensation levels and structures
for banks with characteristics similar to Metropolitan. The Committee gives
particular weight to banks with similar geographic location and similar asset
size. The companies listed in the selected peer group used in developing the
Performance Graph set forth below are companies included in the Bank
Compensation Survey prepared by Crowe Chizek and Company LLP.
Mr. Kaye's and Mr. Lodge's base salary and bonus are reviewed
annually. In making its determinations with regard to salary and bonuses, the
Committee evaluates the executive's level of responsibility and performance. In
the past, the Committee has also taken the performance of the Bank into
account by measuring the Bank's financial performance for the previous year in
light of the internal projections and forecasts prepared by management for the
period.
Prior to 1996, Mr. Kaye received only base salary. His salary has
traditionally been set by the Committee at a level competitive with salaries of
chief executive officers of banks of similar geographic location and asset size.
Mr. Kaye's salary for 1996 was $295,000. In addition, in January of 1997, the
Committee determined that Mr. Kaye should receive a $65,000 bonus as part of his
compensation for fiscal 1996. This increase in salary and bonus was based on Mr.
Kaye's business planning and entrepreneurial skills, his vision, judgment and
leadership as well as his excellent attention to detail. The Committee also
recognized the excellent performance of Mr. Kaye in continuing to attract and
retain outstanding officers and his overall management of those officers. The
Committee awarded the bonus to Mr. Kaye in part due to the success of
Metropolitan and the Bank during 1996. The determination of the bonus amount is
completely within the discretion of the Committee.
Mr. Lodge has traditionally received both salary and bonus. In 1996,
Mr. Lodge's salary was $205,000. Mr. Lodge's salary is based in part on the
recommendation of Mr. Kaye and has traditionally been set by the Committee at a
level competitive with salaries of chief operating officers of banks of similar
geographic location and asset size. In 1996, the Committee determined that Mr.
Lodge was entitled to a bonus of $65,000. Although Mr. Lodge's bonus is also
based in part on a recommendation by Mr. Kaye, the determination of the bonus
amount is completely within the discretion of the Committee.
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13
In the past, including with respect to 1996 compensation, the
compensation of the other Named Executive Officers, Mr. Bevack and Mr. DiAsio,
has been determined by Mr. Lodge, after consultation with Mr. Kaye. Mr. Bevack
has traditionally received both salary and bonus. Mr. Bevack's salary is set by
Mr. Lodge at a level competitive with salaries of chief financial officers of
banks of similar geographic location and asset size. In addition to his
traditional salary, Mr. DiAsio earned his first bonus in fiscal 1996 pursuant to
the Commercial Real Estate Manager's Bonus Program. The Commercial Real Estate
Manager's Bonus Program entitles Mr. DiAsio to additional annual compensation
based on loans procured by Mr. DiAsio during the prior twelve month period. The
additional compensation is payable over a two-year period in 20% increments.
Metropolitan is considering expanding the scope of the duties of the Committee
to include an annual review of the terms and amount of the compensation of each
of the Named Executive Officers.
Robert M. Kaye
Malvin E. Bank
Ralph D. Ketchum
James A. Karman
PERFORMANCE GRAPH
The following chart compares the Corporation's Common Shares with (i)
the Nasdaq Market Index and (ii) a selected peer group which includes all of
the 305 publicly held savings and loan associations located in the United
States. The chart assumes an investment of $100 on October 29, 1996, the day on
which Metropolitan's Common Shares became publicly held, in each of the
Corporation's Common Shares, the Nasdaq Market Index and the stocks in the
selected peer group. The overall performance assumes dividend reinvestment
throughout the period.
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14
COMPARE CUMULATIVE TOTAL RETURN
AMONG METROPOLITAN FINANCIAL CORP.,
NASDAQ MARKET INDEX AND MG GROUP INDEX
10/29/96 11/30/96 12/31/96
-------- -------- --------
DOLLARS [TABLE - GRAPHIC]
-- METROPOLITAN FINANCIAL CORP. -- MG PEER GROUP -- NASDAQ MARKET INDEX
ASSUMES $100 INVESTED ON OCT. 29, 1996
ASSUMES DIVIDEND REINVESTED
FISCAL YEAR ENDING DEC. 31, 1996
11
15
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has selected Crowe, Chizek and Company LLP as
Metropolitan's independent auditors for the fiscal year ending December 31,
1997, and to audit the books and accounts of Metropolitan for that year, subject
to ratification of the selection by the shareholders at the 1997 Annual Meeting.
Crowe, Chizek and Company LLP has been the independent auditors of Metropolitan
since 1991.
Representatives of Crowe, Chizek and Company LLP are expected to be
present at the 1997 Annual Meeting and to be available to respond to appropriate
questions. Their representatives will also be provided an opportunity to make a
statement, if they desire to do so.
Although shareholder approval of this appointment is not required by law
or binding on the Board, the Board believes that shareholders should be given
the opportunity to express their views. If the shareholders do not ratify the
appointment of Crowe, Chizek and Company LLP as Metropolitan's independent
auditors, the Board will consider this vote in determining whether or not to
continue the engagement of Crowe, Chizek and Company LLP.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS RATIFICATION OF
THE SELECTION OF CROWE, CHIZEK AND COMPANY LLP AS INDEPENDENT AUDITORS
FOR METROPOLITAN FINANCIAL CORP. FOR THE FISCAL YEAR ENDING DECEMBER
31, 1997.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Under the securities laws of the United States, Metropolitan's directors
and certain officers are required to report their ownership and changes in
ownership of Metropolitan Common Shares to the SEC. The SEC has established
certain due dates for these reports. Mr. Kaye was late in filing a single
report in 1996 involving the purchase of 10,000 Common Shares. Mr. Mattia was
also late in filing a single report involving two transactions. The two
transactions that were reported on a late filing by Mr. Mattia were the
purchase of 8,200 Common Shares on October 30, 1996 and the purchase of 2,500
Common Shares on October 29, 1996.
1998 SHAREHOLDER PROPOSALS
Any shareholder of Metropolitan wishing to have a proposal considered
for inclusion in Metropolitan's 1998 proxy solicitation materials must set forth
such proposal in writing and file it with the Secretary of Metropolitan on or
before December 10, 1997.
GENERAL
You are urged to complete, date, sign, and return your proxy card
promptly in order to make certain your shares are voted at the 1997 Annual
Meeting. Metropolitan Common Shares represented by properly executed proxy cards
will be voted in accordance with any specification made thereon and, if no
specification is made, will be voted for the election as directors of the
nominees named herein and in favor of ratifying the appointment of Crowe, Chizek
and Company LLP as independent auditors for the fiscal year ending December 31,
1997. The Board of Directors knows of no other matters which will be
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16
presented at the 1997 Annual Meeting. However, if other matters properly come
before the 1997 Annual Meeting or any adjournment, the person or persons voting
the proxy cards will vote them in accordance with their best judgment on such
matters. Unless a broker's authority to vote on a particular matter is limited,
abstentions and broker non-votes are counted in determining the votes present at
a meeting. Consequently, an abstention or a broker non-vote has the same effect
as a vote against a proposal, as each abstention or broker non-vote would be one
less vote in favor of a proposal.
Any shareholder has the power to revoke his or her proxy at any time
before it is voted at the 1997 Annual Meeting by giving written notice of such
revocation to the Secretary of Metropolitan (which notice may be given by the
filing of a duly executed proxy bearing a later date) or by attending the 1997
Annual Meeting and by giving notice of revocation in open meeting.
Shareholders may only nominate a person for election as a director of
Metropolitan at a meeting of shareholders if the nominating shareholder has
strictly complied with the applicable notice and procedural requirements set
forth in Metropolitan's Regulations, including, without limitation, timely
providing to the Secretary of Metropolitan the requisite notice of the proposed
nominee(s) containing all the information specified by the Regulations.
Metropolitan will provide to any shareholder, without charge, a copy of the
applicable procedures governing nomination of directors set forth in
Metropolitan's Regulations upon request of the Secretary of Metropolitan.
Metropolitan will bear the expense of preparing, printing and mailing
this Proxy Statement. In addition to solicitation by mail, personnel of
Metropolitan and its subsidiaries may solicit the return of proxies in person,
by telephone or through other forms of communication. Metropolitan personnel who
participate in this solicitation will not receive any additional compensation
for such solicitation. Metropolitan will request brokers, banks and other
custodians, nominees and fiduciaries to send proxy material to beneficial
owners and will, upon request, reimburse them for their expense in so doing.
By Order of the Board of Directors
MALVIN E. BANK
Secretary
April 10, 1997
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17
METROPOLITAN
[LOGO] FINANCIAL CORP.
METROPOLITAN FINANCIAL CORP.
6001 LANDERHAVEN DRIVE
MAYFIELD HEIGHTS, OHIO 44124
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Robert M. Kaye, David G. Lodge and
Malvin E. Bank and each of them, with FULL power of substitution, as proxies to
vote, as designated below, FOR and in the name of the undersigned all shares of
common stock of Metropolitan Financial Corp. which the undersigned is entitled
to vote at the Annual Meeting of the Shareholders of said CORPORATION scheduled
to be held Tuesday, May 20, 1997 at 11:00 a.m. at the offices of said
CORPORATION, 6001 Landerhaven Drive, Mayfield Heights, Ohio, or at any
adjournment thereof.
The Board of Directors recommends a FOR vote on the election of
Directors and on the proposal to appoint Crowe, Chizek and Company
LLP. Please mark an X in one box under each item.
1. ELECTION of three Class I directors:
[ ] FOR ALL NOMINEES [ ] WITHHOLD AUTHORITY TO VOTE FOR
LISTED BELOW. ALL NOMINEES LISTED BELOW.
CLASS I-LOIS K GOODMAN, MARGUERITE B. HUMPHREY AND ALFONSE M. MATTIA
INSTRUCTION: To withhold authority to vote for any individual nominee, write
the nominee's name in the space below:
2. Proposal to approve the appointment of Crowe, Chizek and Company LLP
as independent auditors of the Corporation for the fiscal year ending
December 31, 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
18
METROPOLITAN
[LOGO] FINANCIAL CORP.
C/O CORPORATE TRUST SERVICES
MD 1090F5
38 FOUNTAIN SQUARE PLAZA
CINCINNATI, OH 45263
NAME APPEARS
fold and detach here
- --------------------------------------------------------------------------------
In their discretion, the PROXIES are authorized to vote upon such other business
as may properly come before the meeting.
This PROXY when executed will be voted in the manner directed hereon by the
undersigned SHAREHOLDER(S).
If no direction is made, this PROXY will be voted FOR Proposals 1 and 2.
ALL FORMER PROXIES ARE HEREBY REVOKED.
Dated: _______________________________ , 1997
NAME APPEARS --------------------------------------
(Signature of Shareholder)
--------------------------------------
(Signature of Shareholder)
(Please sign exactly as your name or
names appear opposite. All joint owners
should sign. When signing in a fiduciary
capacity or as a corporate officer,
please give your full title as such.)