Date: | April | 23, 2013 | |
Time: | 3:00 p.m., Eastern Time | ||
Place: | Watt Auditorium 438 Union Street Ionia, Michigan 48846 |
1. | Elect |
2. | Ratify the appointment of Crowe Horwath LLP as independent auditors for the fiscal year ending December 31, |
3. | Participate in an advisory (non-binding) vote to approve the compensation of our executives, as disclosed in this proxy statement; |
4. | Consider and vote upon a proposal to amend our Long-Term Incentive Plan to |
5. |
Transact any other business that is properly submitted before the Annual Meeting or any adjournments or postponements of the Annual Meeting. |
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Outstanding | ||||||
U.S. Department of the Treasury | ||||||||
1500 Pennsylvania Avenue, NW, Room 2312 | ||||||||
Washington, DC 20220 | 8,062,640 | (1) | 46.27 | % |
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Outstanding | ||||||
U.S. Department of the Treasury | 8,062,424 | (1) | 50.43 | % | ||||
1500 Pennsylvania Avenue, NW, Room 2312 | ||||||||
Washington, DC 20220 |
(1) | The U.S. Department of the Treasury (the “Treasury”) holds 74,426 shares of our Series B, Fixed Rate Cumulative Mandatorily Convertible Preferred Stock (the “Series B Preferred Shares”), and a warrant to purchase 346,154 shares of our common stock. The Treasury has the right to convert all or any portion of the Series B Preferred Shares into shares of our common stock at any time, in its discretion, as well as the right to exercise the warrant at any time, in its discretion. Under rules issued by the Securities and Exchange Commission (“SEC”), because of its right to acquire our common stock at any time, the Treasury is deemed to beneficially own the shares of common stock it may acquire upon conversion of the Series B Preferred Shares and exercise of the warrant. |
Amount and Nature of Beneficial Ownership(1) | Percent of Outstanding | Beneficial Ownership (and percent) Including Certain Deferred Shares (2) | ||||||||||
Nominees for three-year terms expiring in 2016 | ||||||||||||
Donna J. Banks, Ph.D. (age 56) | 45,327 | (3) | .48 | 46,856 | ||||||||
Dr. Banks is a retired Senior Vice President of the Kellogg Company. She became a director in 2005. Dr. Banks’ prior experience in an executive leadership position with a major corporation makes her an important member of the Board. Moreover, her prior experience with a corporation that is subject to the reporting requirements of the Securities Exchange Act of 1934 is of use to the Board and the Company. | (.49 | %) | ||||||||||
William J. Boer (age 58) | 16,232 | .17 | 16,232 | |||||||||
Mr. Boer is President and Founder of Grey Dunes, an independent family office advisory firm in Grand Rapids, Michigan. He was appointed as a director of Independent Bank Corporation in 2012. From 1995 to 2005, Mr. Boer served as Vice President and Chief Operating Officer of RDV Corporation, the family office of the Richard M. DeVos family. In this capacity, Mr. Boer was responsible for running the office's day-to-day operations, which included managing investments, foundation administration, and financial services. Prior to joining RDV Corporation in 1995, Mr. Boer was President of Michigan National Bank, Grand Rapids, and from 1987 to 1993 was Vice President for Administration and Finance at Calvin College. Mr. Boer was deemed to be a strong candidate for appointment to the Board in light of his past banking experience, his investment advisory expertise, and his broad experience in executive leadership roles within a number of industries. | (.17 | %) | ||||||||||
Jeffrey A. Bratsburg (age 69) | 25,096 | .27 | 55,364 | |||||||||
Mr. Bratsburg served as the Chairman of the Board of Directors of Independent Bank Corporation from April 2009 to April 2011. Mr. Bratsburg served as President and CEO of Independent Bank West Michigan from 1985 until his retirement in 1999. He became a director in 2000. Mr. Bratsburg’s prior experience as a bank president, as well as his 20 years of experience in the financial services industry, makes him an important member of the Board. Mr. Bratsburg will be retiring from the Board at the end of 2013 in accordance with the Company’s mandatory retirement age requirement for Board members. | (.58 | %) | ||||||||||
Charles C. Van Loan (age 65) | 79,137 | .85 | 79,137 | |||||||||
Mr. Van Loan served as President and CEO of Independent Bank Corporation from 1993 until 2004 and as Executive Chairman during 2005. He retired on December 31, 2005. He first became a director in 1992. Mr. Van Loan has over 29 years of experience in the financial services industry. Mr. Van Loan served as the Company’s CEO for over 10 years, which makes his input useful to the Board. | (.85 | %) |
Amount and Nature of Beneficial Ownership(1) | Percent of Outstanding | |||||||
Nominees for three-year terms expiring in 2014 | ||||||||
Stephen L. Gulis, Jr. (age 52) | 3,145 | (2) | .04 | |||||
Mr. Gulis is the retired Executive Vice President and President of Wolverine Worldwide Global Operations Group. He served as Executive Vice President, CFO and Treasurer of Wolverine Worldwide prior to his appointment as President, Global Operations. He became a director in 2004. Mr. Gulis’ prior experience as a chief financial officer of a major corporation is an important skill set to have on the Board. In addition, his prior experience with a corporation that is subject to the reporting requirements of the Securities Exchange Act of 1934 is important to the Board. | ||||||||
Terry L. Haske (age 61) | 10,040 | (3) | .13 | |||||
Mr. Haske is a CPA and Principal with Anderson, Tuckey, Bernhardt & Doran, P.C. since 2008. Prior to 2008 he was the President of Ricker & Haske, CPAs, and P.C. He became a director in 1996. Mr. Haske’s experience and qualifications as a CPA, as well as his prior service as a director of the Company and as a director of other banking institutions, makes his service to the Board particularly important. | ||||||||
Charles A. Palmer (age 65) | 21,294 | .27 | ||||||
Mr. Palmer is an attorney and a professor of law at Thomas M. Cooley Law School. He became a director in 1991. Mr. Palmer’s training as an attorney and almost 20 years of service as a director of the Company provides additional talent to the Board. | ||||||||
Directors whose terms expire in 2012 | ||||||||
Robert L. Hetzler (age 64) | 3,304 | (4) | .04 | |||||
Mr. Hetzler is the retired President of Monitor Sugar Company (food processor). He became a director in 2000. Mr. Hetzler, who also has a legal degree, has numerous years as a senior leader of a large business organization. Those skill sets and experiences are important to the Board and the Company. | ||||||||
Michael M. Magee, Jr. (age 54) | 15,433 | (5) | .19 | |||||
Mr. Magee is the President and Chief Executive Officer of Independent Bank Corporation (although he will be resigning as President April 1, 2011). Prior to his appointment as President and CEO as of January 1, 2005, Mr. Magee served as Chief Operating Officer since February 2004 and prior to that he served as President and Chief Executive Officer of Independent Bank since 1993. He became a director in 2005. Mr. Magee has over 31 years of service in the financial services industry and has served as our Chief Executive Officer for over 6 years. That position and those experiences make him a particularly important component of the Board. | ||||||||
James E. McCarty (age 62) | 6,680 | (6) | .08 | |||||
Mr. McCarty is the retired President of McCarty Communications (commercial printing). He became a director in 2002. Mr. McCarty’s prior experience in a corporate leadership position and prior service as a director of a financial institution makes his service to the Board important. |
Amount and Nature of Beneficial Ownership (1) | Percent of Outstanding | Beneficial Ownership (and percent) Including Certain Deferred Shares (2) | ||||||||||
Directors whose terms expire in 2014 | ||||||||||||
Stephen L. Gulis, Jr. (age 55) | 20,044 | .21 | 53,847 | |||||||||
Mr. Gulis is the President of Kamps, Inc., a Grand Rapids, Michigan based pallet supplier. In 2008, he retired as the Executive Vice President and President of Wolverine Worldwide Global Operations Group. He served as Executive Vice President, CFO and Treasurer of Wolverine Worldwide prior to his appointment as President, Global Operations. He became a director of Independent Bank Corporation in 2004. Mr. Gulis’ prior experience as a chief financial officer of a major corporation is an important skill set to have on the Board. In addition, his prior experience with a corporation that is subject to the reporting requirements of the Securities Exchange Act of 1934 is important to the Board. | (.57 | %) | ||||||||||
Terry L. Haske (age 64) | 27,261 | .29 | 52,782 | |||||||||
Mr. Haske is a CPA and Principal with Anderson, Tuckey, Bernhardt & Doran, P.C. since 2008. Prior to 2008 he was the President of Ricker & Haske, CPAs, and P.C. He became a director of Independent Bank Corporation in 1996. Mr. Haske’s experience and qualifications as a CPA, as well as his prior service as a director of the Company and as a director of other banking institutions, makes his service to the Board important. | (.56 | %) | ||||||||||
William B. Kessel (age 48) | 9,914 | .11 | 9,914 | |||||||||
Mr. Kessel serves as President and CEO of Independent Bank Corporation and Independent Bank. Prior to his appointment as President and CEO as of January 1, 2013, Mr. Kessel served as President since April 1, 2011, as Chief Operating Officer from 2007 to 2011, and as President of Independent Bank (prior to the consolidation of our four bank charters) from 2004 to 2007. Mr. Kessel has over 26 years of service in the financial services industry. His positions with the Company and those experiences make him an important component of the Board. | (.11 | %) | ||||||||||
Charles A. Palmer (age 68) | 66,770 | .71 | 66,770 | |||||||||
Mr. Palmer is an attorney and a professor of law at Thomas M. Cooley Law School. He became a director of Independent Bank Corporation in 1991. Mr. Palmer’s training as an attorney and almost 22 years of service as a director of the Company provides additional talent to the Board. | (.71 | %) |
Amount and Nature of Beneficial Ownership(1) | Percent of Outstanding | |||||||
Directors whose terms expire in 2013 | ||||||||
Donna J. Banks, Ph.D. (age 52) | 2,185 | (7) | .03 | |||||
Dr. Banks is a retired Senior Vice President of the Kellogg Company. She became a director in 2005. Ms. Banks’ prior experience in an executive leadership position with a major corporation makes her service to the Board particularly important. Moreover, her prior experience with a corporation that is subject to the reporting requirements of the Securities Exchange Act of 1934 is of use to the Board and the Company. | ||||||||
Jeffrey A. Bratsburg (age 66) | 9,880 | (8) | .12 | |||||
Mr. Bratsburg is the Chairman of the Board of Directors of Independent Bank Corporation. Mr. Bratsburg served as President and CEO of Independent Bank West Michigan from 1985 until his retirement in 1999. He became a director in 2000. Mr. Bratsburg’s prior experience as a bank president, as well as his 18 years of experience in the financial services industry, makes him an important member of the Board. | ||||||||
Charles C. Van Loan (age 62) | 32,746 | (9) | .41 | |||||
Mr. Van Loan served as President and CEO of Independent Bank Corporation from 1993 until 2004 and as executive Chairman during 2005. He retired on December 31, 2005. He became a director in 1992. Mr. Van Loan has over 27 years of experience in the financial services industry. Mr. Van Loan served as the Company’s CEO for over 10 years, which makes his input particularly useful to the Board. |
Amount and Nature of Beneficial Ownership (1) | Percent of Outstanding | Beneficial Ownership (and percent) Including Certain Deferred Shares (2) | ||||||||||||||
Directors whose terms expire in 2015 | ||||||||||||||||
Robert L. Hetzler (age 67) | 48,221 | (4) | .51 | 48,221 | ||||||||||||
Mr. Hetzler is the retired President of Monitor Sugar Company (food processor). He became a director of Independent Bank Corporation in 2000. Mr. Hetzler, who also has a legal degree, has numerous years as a senior leader of a large business organization. Those skill sets and experiences are important to the Board and the Company. | (.51 | %) | ||||||||||||||
Michael M. Magee, Jr. (age 57) | 115,761 | (5) | 1.24 | 115,761 | ||||||||||||
Mr. Magee is the Executive Chairman of the Board of Directors. Prior to January 1, 2013, Mr. Magee was the Chief Executive Officer of Independent Bank Corporation since January 1, 2005, Executive Vice President and Chief Operating Officer since 2004 and prior to that he served as President and Chief Executive Officer of Independent Bank since 1993. He became a director of Independent Bank Corporation in 2005. Mr. Magee has over 32 years of service in the financial services industry and had served as our Chief Executive Officer for 8 years. That position and those experiences make him an important component of the Board. | (1.24 | %) | ||||||||||||||
James E. McCarty (age 65) | 24,032 | (6) | .26 | 53,853 | ||||||||||||
Mr. McCarty became a director of Independent Bank Corporation in 2002 and currently serves as the lead independent director of the Board. He is the retired President of McCarty Communications (commercial printing). Mr. McCarty’s prior experience in a corporate leadership position and prior service as a director of a financial institution makes his service to the Board important. | (.57 | %) |
(1) | Except as described in the following notes, each nominee or incumbent director owns the shares directly and has sole voting and investment power or shares voting and investment power with his or her spouse under joint ownership. The table includes shares of common stock that are issuable under options exercisable within 60 days. |
(2) |
(3) | Includes |
(4) | Includes 1,061 shares held in a spousal |
(5) | Includes |
(6) | Includes |
Name | Amount and Nature of Beneficial Ownership (1) (2) | Percent of Outstanding | ||||||
Michael M. Magee | 115,761 | 1.24 | ||||||
William B. Kessel | 9,914 | .11 | ||||||
Robert N. Shuster | 17,178 | .18 | ||||||
Mark L. Collins | 15,416 | .16 | ||||||
David C. Reglin | 20,602 | .22 | ||||||
All executive officers and directors as a group (consisting of 19 persons) | 864,924 | (3) | 9.22 | |||||
All executive officers and directors as a group (consisting of 19 persons), including certain director-deferred shares (see footnote (2) to table on page 5 above) | 986,311 | (3) | 10.37 |
Name | Amount and Nature of Beneficial Ownership(1) (2) | Percent of Outstanding | ||||||
Michael M. Magee | 15,433 | .19 | ||||||
Robert N. Shuster | 16,317 | .21 | ||||||
David C. Reglin | 9,467 | .12 | ||||||
William B. Kessel | 4,452 | .06 | ||||||
Stefanie M. Kimball | 3,338 | .04 | ||||||
Mark L. Collins | 13,732 | .17 | ||||||
All executive officers and directors as a group (consisting of 17 persons) | 347,302 | (3) | 4.38 |
(1) | In addition to shares held directly or under joint ownership with their spouses, beneficial ownership includes shares that are issuable under options exercisable within 60 days, and shares that are allocated to their accounts as participants in the ESOP. |
(2) | Does not include shares that may be issued pursuant to restricted stock units granted to each executive officer (other than Mr. Magee), in February 2011 and August 2012, as described under |
(3) | Beneficial ownership is disclaimed as to |
Year Ended December 31, | ||||||||
2012 | 2011 | |||||||
Audit fees | $ | 400,000 | $ | 400,000 | ||||
Audit related fees(1) | 37,000 | 40,000 | ||||||
Tax fees(2) | 69,000 | 156,000 | ||||||
All other fees | 15,000 | 5,000 | ||||||
Total | $ | 521,000 | $ | 601,000 |
Year Ended December 31, | ||||||||
2010 | 2009 | |||||||
Audit fees | $ | 410,000 | $ | 390,000 | ||||
Audit related fees(1) | 42,000 | 46,000 | ||||||
Tax fees(2) | 134,000 | 79,000 | ||||||
All other fees (3) | 238,000 | 16,000 | ||||||
Total | $ | 824,000 | $ | 531,000 |
(1) | Consists primarily of fees related to an audit required under a Housing and Urban Development loan |
(2) | Consists primarily of fees related to the preparation of corporate tax returns and also includes amounts for tax advice |
Name | Position | Dollar Value | Number of Units |
Michael M. Magee, Jr. | President(1) and Chief Executive Officer | $200,000(2) | Not determinable(2) |
William B. Kessel | Executive Vice President(3) and Chief Operating Officer | 143,000(4) | 33,333 |
Robert N. Shuster | Executive Vice President and Chief Financial Officer | 115,000(4) | 26,806 |
David C. Reglin | Executive Vice President for Retail Banking | 113,000(4) | 26,340 |
Stefanie M. Kimball | Executive Vice President and Chief Lending Officer | 113,000(4) | 26,340 |
Mark Collins | Executive Vice President and General Counsel | 115,000(4) | 26,806 |
Executive Group | 799,000 | Not determinable(2) | |
Non-Executive Director Group | Not determinable | Not determinable | |
Non-Executive Officer Employee Group | Not determinable | Not determinable |
Executive Officer | Value of Restricted Stock Units Granted February 15, 2011(1) | Value of Restricted Stock Units Granted August 28, 2012(1) | ||||||
William B. Kessel | $ | 143,000 | $ | 168,000 | ||||
Robert N. Shuster | 115,000 | 92,000 | ||||||
Mark L. Collins | 115,000 | 92,000 | ||||||
David C. Reglin | 113,000 | 90,400 |
(1) | Values based upon the market price of our common stock on the date of grant. |
Net Income | Non-Performing Asset Reduction | Organic Deposit Growth | Efficiency Ratio | ||||||||||
Threshold | $8.0 million | 15.0 | % | 3.0 | % | 75 | % | ||||||
Target | $12.0 million | 25.0 | % | 5.0 | % | 70 | % | ||||||
Maximum | $24.0 million | 50.0 | % | 10.0 | % | 60 | % |
Name and Principal Position | Year | Salary (1) | Bonus | Stock Awards (2) | Option Awards (2) | Non-Equity Incentive Plan Compensation | All Other Compensation (3) | Totals | |||||||||||||||||||||
Michael M. Magee | 2010 | $ | 382,000 | $ | - | $ | - | $ | - | $ | - | $ | 3,618 | $ | 385,618 | ||||||||||||||
President and Chief | 2009 | 382,000 | - | - | 42,678 | - | 26,853 | 451,531 | |||||||||||||||||||||
Executive Officer | 2008 | 382,000 | - | 349,996 | - | - | 35,904 | 767,900 | |||||||||||||||||||||
Robert N. Shuster | 2010 | 230,000 | - | - | - | - | 8,115 | 238,115 | |||||||||||||||||||||
Executive Vice President | 2009 | 230,000 | - | - | 12,848 | - | 28,959 | 271,807 | |||||||||||||||||||||
and Chief Financial Officer | 2008 | 230,000 | - | 109,994 | - | - | 24,318 | 364,312 | |||||||||||||||||||||
David C. Reglin | 2010 | 226,000 | - | - | - | - | 3,389 | 229,389 | |||||||||||||||||||||
Executive Vice President- | 2009 | 226,000 | - | - | 12,624 | - | 24,612 | 263,236 | |||||||||||||||||||||
Retail Bainking | 2008 | 226,000 | - | 109,994 | - | - | 27,415 | 363,409 | |||||||||||||||||||||
Stefanie M. Kimball | 2010 | 226,000 | - | - | - | - | 2,128 | 228,128 | |||||||||||||||||||||
Executive Vice President- | 2009 | 226,000 | - | - | 12,624 | - | 14,414 | 253,038 | |||||||||||||||||||||
Chief Lending Officer | 2008 | 226,000 | - | 99,999 | - | - | 16,558 | 342,557 | |||||||||||||||||||||
William B. Kessel | 2010 | 226,000 | - | - | - | - | 3,552 | 229,552 | |||||||||||||||||||||
Executive Vice President- | 2009 | 226,000 | - | - | 12,624 | - | 22,363 | 260,987 | |||||||||||||||||||||
Chief Operations Officer | 2008 | 226,000 | - | 107,499 | - | - | 27,431 | 360,930 | |||||||||||||||||||||
Mark L. Collins (4) | 2010 | 217,308 | - | - | - | - | 881 | 218,189 | |||||||||||||||||||||
Executive Vice President- | 2009 | 184,615 | - | - | 6,701 | - | 25 | 191,341 | |||||||||||||||||||||
General Counsel | 2008 | - | - | - | - | - | - | - |
Name and Principal Position | Year | Salary (1) | Bonus | Stock Awards (2) | Option Awards (2) | Non-Equity Incentive Plan Compensation | All Other Compensation (3) | Totals | ||||||||||||||||||||||
Michael M. Magee (4) | 2012 | $ | 582,000 | $ | - | $ | - | $ | - | $ | - | $ | 9,380 | $ | 591,380 | |||||||||||||||
Chief Executive Officer | 2011 | 582,000 | - | - | - | - | 3,103 | 585,103 | ||||||||||||||||||||||
2010 | 382,000 | - | - | - | - | 3,618 | 385,618 | |||||||||||||||||||||||
William B. Kessel (5) | 2012 | 336,000 | - | 168,000 | - | - | 34,052 | 538,052 | ||||||||||||||||||||||
President | 2011 | 296,769 | - | 143,000 | - | - | 76,603 | 516,372 | ||||||||||||||||||||||
2010 | 226,000 | - | - | - | - | 3,552 | 229,552 | |||||||||||||||||||||||
Robert N. Shuster | 2012 | 230,000 | - | 92,000 | - | - | 14,733 | 336,733 | ||||||||||||||||||||||
Executive Vice President | 2011 | 230,000 | - | 115,000 | - | - | 9,187 | 354,187 | ||||||||||||||||||||||
and Chief Financial | 2010 | 230,000 | - | - | - | - | 8,115 | 238,115 | ||||||||||||||||||||||
Officer | ||||||||||||||||||||||||||||||
Mark L. Collins | 2012 | 230,000 | - | 92,000 | - | - | 13,013 | 335,013 | ||||||||||||||||||||||
Executive Vice President - | 2011 | 230,000 | - | 115,000 | - | - | 6,001 | 351,001 | ||||||||||||||||||||||
General Counsel | 2010 | 217,308 | - | - | - | - | 881 | 218,189 | ||||||||||||||||||||||
David C. Reglin | 2012 | 226,000 | - | 90,400 | - | - | 11,900 | 328,300 | ||||||||||||||||||||||
Executive Vice President - | 2011 | 226,000 | - | 113,000 | - | - | 8,805 | 347,805 | ||||||||||||||||||||||
Retail Banking | 2010 | 226,000 | - | - | - | - | 3,389 | 229,389 |
(1) | Includes elective deferrals by employees pursuant to Section 401(k) of the Internal Revenue Code. |
(2) | Amounts set forth in the stock and option awards columns represent the aggregate fair value of awards as of the grant date, computed in accordance with FASB ASC topic 718, “Compensation - Stock Compensation”. The assumptions used in calculating these award amounts are set forth in Note 14, of the Company's 2012 Annual Report. |
(3) | Amounts include our contributions to the ESOP (subject to certain age and service requirements, all employees are eligible to participate in the ESOP), matching contributions to qualified defined contribution plans, and IRS determined personal use of company owned automobiles, country club and other social club dues. In 2011 and 2012, the totals for Mr. Kessel also include relocation expenses of $70,000 and $20,000, respectively. |
(4) | The 2011 and 2012 salary for Mr. Magee includes $200,000 paid in salary stock. Mr. Magee served as President and CEO through March 31, 2011. From April 1, 2011, through December 31, 2012, he served as CEO. |
(5) | The 2012 salary for Mr. Kessel includes $15,000 paid in salary stock. Mr. Kessel assumed the role of President on April 1, 2011. Effective January 1, 2013, he also assumed the role of CEO. For 2010 and the first quarter of 2011, Mr. Kessel served as Executive Vice President and Chief Operating Officer. |
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards (1) | Estimated Future Payouts Under Equity Incentive Plan Awards (1) | All Other Stock Awards: Number Of Shares of Stock or Units | All Other Option Awards: Number of Securities Underlying Options | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards | |||||||||||||||||||||||||||||||||||||||
Grant | Threshold | Target | Maximum | Threshold | Target | Maximum | ||||||||||||||||||||||||||||||||||||||
Name | Date | $ | $ | $ | $ | $ | $ | (1) | (1) | (1) | ($)(1) | |||||||||||||||||||||||||||||||||
Michael M. Magee | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | - | - | $ | - | $ | - | |||||||||||||||||||||||||
Robert N. Shuster | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||
David C. Reglin | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||
Stefanie M. Kimball | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||
William B. Kessel | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||
Mark L. Collins | - | - | - | - | - | - | - | - | - | - | - |
Date of | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards (1) | Estimated Future Payouts Under Equity Incentive Plan Awards (1) | All Other Stock Awards: Number of Shares | All Other Option Awards: Number of Securities | Exercise or Base Price of Option | Grant Date Fair Value of Stock | ||||||||||||||||||||||||||||||||||||||||
Name | Grant Date | Board Action | Threshold $ | Target $ | Maximum $ | Threshold $ | Target $ | Maximum $ | of Stock or Units | Underlying Options(1) | Awards ($/Sh)(1) | and Option Awards($) | ||||||||||||||||||||||||||||||||||
Michael M. Magee | (2) | Various | 02/15/11 | - | - | - | - | - | - | 80,615 | - | - | $ | 200,000 | ||||||||||||||||||||||||||||||||
William B. Kessel | (3) | Various | 01/18/12 | - | - | - | - | - | - | 6,020 | - | - | 15,000 | |||||||||||||||||||||||||||||||||
(4) | 08/28/12 | 08/27/12 | 60,431 | 168,000 | ||||||||||||||||||||||||||||||||||||||||||
Robert N. Shuster | (4) | 08/28/12 | 08/27/12 | - | - | - | - | - | - | 33,093 | - | - | 92,000 | |||||||||||||||||||||||||||||||||
Mark L. Collins | (4) | 08/28/12 | 08/27/12 | - | - | - | - | - | - | 33,093 | - | - | 92,000 | |||||||||||||||||||||||||||||||||
David C. Reglin | (4) | 08/28/12 | 08/27/12 | - | - | - | - | - | - | 32,517 | - | - | 90,400 |
(1) | No such awards were granted during 2012. |
(2) | Stock awards for Mr. Magee represent unrestricted shares of our common stock issued to Mr. Magee as part of his base salary in 2012. These shares were issued under the Long-Term Incentive Plan. Such shares were distributed on a bi-weekly basis throughout 2012 and were fully vested upon grant. The number of shares granted to Mr. Magee each bi-weekly pay period had a value on the date of issuance of $7,692 (which is equal to the $200,000 aggregate value of the 2012 salary stock award, divided by 26 pay periods). This resulted in individual grants per pay period ranging from 2,030 to 5,305 shares based on per share values of $1.45 to $3.79. Of the 80,615 shares of salary stock granted to Mr. Magee in 2012, a total of 34,320 were withheld to cover tax withholding obligations. The value of this salary stock is included in the “Salary” column for Mr. Magee in the Summary Compensation Table above. |
(3) | Stock awards for Mr. Kessel represent unrestricted shares of our common stock issued to Mr. Kessel as part of his base salary in 2012. These shares were issued under the Long-Term Incentive Plan. Such shares were distributed on a bi-weekly basis throughout 2012 and were fully vested upon grant. The number of shares granted to Mr. Kessel each bi-weekly pay period had a value on the date of issuance of $577 (which is equal to the $15,000 aggregate value of the 2012 salary stock award, divided by 26 pay periods). This resulted in individual grants per pay period ranging from 152 to 367 shares based on per share values of $1.57 to $3.79. Of the 6,020 shares of salary stock granted to Mr. Kessel in 2012, a total of 2,450 were withheld to cover tax withholding obligations. The value of this salary stock is included in the “Salary” column for Mr. Kessel in the Summary Compensation Table above. |
(4) | These stock awards represent restricted stock units (RSUs) granted to the Named Executive on August 28, 2012 with an aggregate grant date fair value equal to the dollar amount shown for the Named Executive in the final column of the table above. As of the grant date, the fair market value of each share of common stock underlying a RSU was $2.78. Each RSU constitutes the right, subject to certain terms and conditions, to receive one share of our common stock if and when the RSU vests. The RSUs vest upon the Company's repayment of its TARP obligations, but not earlier than three years from the grant date. This summary of the terms of the RSUs is subject to the terms and conditions of the Restricted Stock Unit Grant Agreement the Company entered into with each Named Executive to whom RSUs were granted, a form of which was filed as Exhibit 10.2 to our Form 10-Q filed with the SEC on May 9, 2011. The grant date fair value of the RSUs is included in the “Stock Awards” column for the Named Executive in the Summary Compensation Table above. |
Stock Awards | |||||||||||||||||||||||
Option Awards | Number of Shares | Market Value of | |||||||||||||||||||||
Grant | Number of Securities Underlying Unexercised Options | Option | Option | or Units of Stock That Have | Shares or Units of Stock That Have | ||||||||||||||||||
Name | Date | Exercisable | Unexercisable (1) | Exercise Price | Expiration Date | Not Vested (2) | Not Vested (3) | ||||||||||||||||
Michael M. Magee | 01/30/09 | 6,166 | - | $ | 15.90 | 01/30/19 | |||||||||||||||||
William B. Kessel | 01/15/08 | 1,409 | $ | 4,932 | |||||||||||||||||||
01/30/09 | 1,824 | - | 15.90 | 01/30/19 | |||||||||||||||||||
02/15/11 | 33,333 | 116,666 | |||||||||||||||||||||
08/28/12 | 60,431 | 211,509 | |||||||||||||||||||||
Robert N. Shuster | 01/15/08 | 1,442 | 5,047 | ||||||||||||||||||||
01/30/09 | 1,856 | - | 15.90 | 01/30/19 | |||||||||||||||||||
02/15/11 | 26,806 | 93,821 | |||||||||||||||||||||
08/28/12 | 33,093 | 115,826 | |||||||||||||||||||||
Mark L. Collins | 01/30/09 | 968 | - | 15.90 | 01/30/19 | ||||||||||||||||||
02/15/11 | 26,806 | 93,821 | |||||||||||||||||||||
08/28/12 | 33,093 | 115,826 | |||||||||||||||||||||
David C. Reglin | 01/15/08 | 1,442 | 5,047 | ||||||||||||||||||||
01/30/09 | 1,824 | - | 15.90 | 01/30/19 | |||||||||||||||||||
02/15/11 | 26,340 | 92,190 | |||||||||||||||||||||
08/28/12 | 32,517 | 113,810 |
Stock Awards | |||||||||||||||||||||||
Option Awards | Number of Shares or Units of Stock That Have Not Vested (2) | Market Value of Shares or Units of Stock That Have Not Vested (3) | |||||||||||||||||||||
Number of Securities Underlying | |||||||||||||||||||||||
Grant Date | Unexercised Options | Option Exercise Price | Option Expiration Date | ||||||||||||||||||||
Name | Exercisable | Unexercisable (1) | |||||||||||||||||||||
Michael M. Magee | 01/21/01 | 1,022 | - | $ | 97.90 | 01/21/11 | |||||||||||||||||
04/24/07 | 1,049 | $ | 1,364 | ||||||||||||||||||||
01/15/08 | 4,587 | 5,963 | |||||||||||||||||||||
01/30/09 | 2,055 | 4,111 | 15.90 | 01/30/19 | |||||||||||||||||||
Robert N. Shuster | 04/17/01 | 477 | - | 99.70 | 04/17/11 | ||||||||||||||||||
04/24/07 | 330 | 429 | |||||||||||||||||||||
01/15/08 | 1,442 | 1,875 | |||||||||||||||||||||
01/30/09 | 619 | 1,237 | 15.90 | 01/30/19 | |||||||||||||||||||
David C. Reglin | 01/21/01 | 930 | - | 97.90 | 01/21/11 | ||||||||||||||||||
04/17/01 | 605 | - | 99.70 | 04/17/11 | |||||||||||||||||||
04/24/07 | 330 | 429 | |||||||||||||||||||||
01/15/08 | 1,442 | 1,875 | |||||||||||||||||||||
01/30/09 | 608 | 1,216 | 15.90 | 01/30/19 | |||||||||||||||||||
Stefanie M. Kimball | 04/24/07 | 300 | 390 | ||||||||||||||||||||
01/15/08 | 1,311 | 1,704 | |||||||||||||||||||||
01/30/09 | 608 | 1,216 | 15.90 | 01/30/19 | |||||||||||||||||||
William B. Kessel | 04/24/07 | 322 | 419 | ||||||||||||||||||||
01/15/08 | 1,409 | 1,832 | |||||||||||||||||||||
01/30/09 | 608 | 1,216 | 15.90 | 01/30/19 | |||||||||||||||||||
Mark L. Collins | 01/30/09 | 323 | 645 | 15.90 | 01/30/19 |
(1) | Options granted on January 30, 2009 vest ratably over the three-year period beginning January 30, 2010. |
(2) | The shares of restricted stock are subject to risks of forfeiture until they vest in full. Shares granted in 2008 vest in full on the fifth anniversary of the grant date. Restricted stock units granted in 2011 vest upon the Company's repayment of its TARP obligations, but not earlier than two years from the grant date. Restricted stock units granted in 2012 are subject to the vesting schedule described in footnote (4) to the Grants of Plan Based Awards table above. |
(3) | The market value of the shares of restricted stock or restricted stock units that have not vested is based on the closing price of our common stock as of December 31, 2012. |
Option Awards | Stock Awards | |||||||||||||||
Name | Number of Shares Acquired on Exercise | Value Realized on Exercise | Number of Shares Acquired on Vesting | Value Realized on Vesting (1) | ||||||||||||
Michael M. Magee | - | - | 1,049 | $ | 3,189 | |||||||||||
William B. Kessel | - | - | 322 | 979 | ||||||||||||
Robert N. Shuster | - | - | 330 | 1,003 | ||||||||||||
Mark L. Collins | - | - | - | - | ||||||||||||
David C. Reglin | - | - | 330 | 1,003 |
(1) | ||||||||||||||||
restricted stock as of the date of vesting. |
Name | Executive Contributions in 2010 (1) | Registrant Contributions in 2010 | Aggregate Earnings in 2010 | Aggregate Withdrawals/ Distributions | Aggregate Balance December 31, 2010 | |||||||||||||||
Michael M. Magee | $ | - | $ | - | $ | (6,150 | ) | $ | - | $ | 1,355 | |||||||||
Robert N. Shuster | - | - | 14 | - | 52,430 | |||||||||||||||
David C. Reglin | - | - | - | - | - | |||||||||||||||
Stefanie M. Kimball | - | - | - | - | - | |||||||||||||||
William B. Kessel | - | - | - | - | - | |||||||||||||||
Mark L. Collins | - | - | - | - | - |
Executive Name | (1) Estimated Liability for Severance Payments & Benefit Amounts Under Continuity Agreements | (2) Payment Limitation Based on IRS Section 280G Limitation on Severance Amounts | (1) Estimated Liability for Severance Payments & Benefit Amounts Under Continuity Agreements | (2) Payment Limitation Based on IRS Section 280G Limitation on Severance Amounts | ||||||||||||
Michael M. Magee | $ | 1,254,457 | $ | 1,196,968 | $ | 1,546,613 | $ | 1,368,805 | ||||||||
William B. Kessel | 1,119,059 | 839,966 | ||||||||||||||
Robert N. Shuster | 773,149 | 688,306 | 761,916 | 707,705 | ||||||||||||
Mark L. Collins | 773,310 | 661,737 | ||||||||||||||
David C. Reglin | 760,483 | 697,186 | 767,006 | 652,472 | ||||||||||||
Stefanie M. Kimball | 769,727 | 639,117 | ||||||||||||||
William B. Kessel | 769,727 | 682,816 | ||||||||||||||
Mark L. Collins | 741,401 | 628,457 |
(1) | The Company has entered into a Management Continuity Agreement with each of the above Named Executives that provides for defined severance compensation and other benefits if the executive is terminated in connection with a change of control of the Company. The agreements provide for a lump sum payout of the severance compensation and a continuation of certain health and medical insurance related benefits for a period of three years. For further information, see the section titled “Severance and Change in Control Payments” above. |
(2) | The total amounts that may be payable under the Management Continuity Agreements are subject to and limited by Internal Revenue Service Section 280G. This column indicates the estimated payout based on IRS limitations. |
Name | Fees Earned or Paid in Cash | Option Awards(1) | Totals | Aggregate Stock Options Held as of 12/31/10 | Fees Earned or Paid in Cash (1) | Option Awards(2) | Totals | Aggregate Stock Options Held as of 12/31/12 | ||||||||||||||||||||||||
Donna J. Banks | $ | 51,300 | $ | — | $ | 51,300 | — | $ | 51,300 | $ | — | $ | 51,300 | — | ||||||||||||||||||
William J. Boer | 8,550 | — | 8,550 | — | ||||||||||||||||||||||||||||
Jeffrey A. Bratsburg | 51,300 | — | 51,300 | 823 | 51,300 | — | 51,300 | — | ||||||||||||||||||||||||
Stephen L. Gulis, Jr.(2) | 56,300 | — | 56,300 | — | ||||||||||||||||||||||||||||
Stephen L. Gulis, Jr.(3) | 56,300 | — | 56,300 | — | ||||||||||||||||||||||||||||
Terry L. Haske | 51,300 | — | 51,300 | 823 | 51,300 | — | 51,300 | — | ||||||||||||||||||||||||
Robert L. Hetzler | 51,300 | — | 51,300 | 823 | 51,300 | — | 51,300 | — | ||||||||||||||||||||||||
Clarke B. Maxson(3) | 51,300 | — | 51,300 | — | ||||||||||||||||||||||||||||
James E. McCarty(4) | 54,300 | — | 54,300 | — | 54,300 | — | 54,300 | — | ||||||||||||||||||||||||
Charles A. Palmer(5) | 53,300 | — | 53,300 | 823 | 53,300 | — | 53,300 | — | ||||||||||||||||||||||||
Charles C. Van Loan(6) | 55,300 | — | 55,300 | — | 57,300 | — | 57,300 | — | ||||||||||||||||||||||||
Totals | $ | 475,700 | $ | — | $ | 475,700 | 3,292 | $ | 434,950 | $ | — | $ | 434,950 | — |
(1) | For 2012, all fees, except for Mepco Finance Corporation Board meeting fees paid to Mr. Van Loan ($6,000 in the aggregate) and fees paid to Mr. Boer, were paid in the form of the Company’s common stock. |
(2) | No stock options were awarded to the Board during |
Includes additional retainer for service as chairperson of the audit committee. |
(4) | Includes additional retainer for service as chairperson of the compensation committee. |
(5) | Includes additional retainer for service as chairperson of the nominating and corporate governance committee. |
(6) | Includes fees received for attendance at Mepco Finance Corporation |
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS 2, 3 AND 4. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting or any adjournment thereof. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HEREx |
| |||||||||
1. Election of Directors: | 2. | Ratification of the appointment of Crowe Horwath, LLP as independent auditors for the fiscal year ending December 31, | o | o | o | ||||
NOMINEES: | |||||||||
oFOR ALL NOMINEES | o Donna J. Banks, PhD. o Jeffrey A. Bratsburg o | Expiring in Expiring in Expiring in Expiring in 2016 | 3. | Approval of an advisory (non-binding) resolution to approve the compensation paid to our executives. | o | o | o | ||
oWITHHOLD AUTHORITY FOR ALL NOMINEES | 4. | Approval of an amendment to our Long-Term Incentive Plan to | o | o | o | ||||
oFOR ALL EXCEPT (See instructions below) | |||||||||
If a proxy is returned and no instructions are given, the proxy will be voted FOR the election of directors and FOR proposals 2, 3 | |||||||||
INSTRUCTIONS:To withhold authority to vote for any individual nominee(s), mark "FOR ALL EXCEPT" and fill in the circle next to each nominee you wish to withhold, as shown here:● | |||||||||
To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. o |
Signature of Shareholder | Date: | Signature of Shareholder | Date: | |||||||
Note:Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. |
PROXY VOTING INSTRUCTIONS |
INTERNET- Access " | ||||||
TELEPHONE-Call toll-free1-800-PROXIES(1-800-776-9437) in the United States or1-718-921-8500from foreign countries from any touch-tone telephone and follow the instructions. Have your proxy card available when you call and use the Company Number and Account Number shown on your proxy card. | ||||||
Vote online/phone until 11:59 PM EST the day before the meeting. | ACCOUNT NUMBER | |||||
MAIL - | ||||||
IN PERSON - | ||||||
Information on directions to the site of our Annual Meeting is available on our website at | ||||||
NOTICE OF INTERNET AVAILABILITY OF PROXY | ||||||
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS 2, 3 AND 4. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting or any adjournment thereof. PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HEREx |
| | ||||||||
1. Election of Directors: | 2. | Ratification of the appointment of Crowe Horwath, LLP as independent auditors for the fiscal year ending December 31, | o | o | o | ||||
NOMINEES: | |||||||||
oFOR ALL NOMINEES | o Donna J. Banks, PhD. o Jeffrey A. Bratsburg o | Expiring in Expiring in Expiring in Expiring in 2016 | 3. | Approval of an advisory (non-binding) resolution to approve the compensation paid to our executives. | o | o | o | ||
oWITHHOLD AUTHORITY FOR ALL NOMINEES | 4. | Approval of an amendment to our Long-Term Incentive Plan to | o | o | o | ||||
oFOR ALL EXCEPT (See instructions below) | |||||||||
If a proxy is returned and no instructions are given, the proxy will be voted FOR the election of directors and FOR proposals 2, 3 | |||||||||
INSTRUCTIONS:To withhold authority to vote for any individual nominee(s), mark "FOR ALL EXCEPT" and fill in the circle next to each nominee you wish to withhold, as shown here:● | |||||||||
To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. o |
Signature of Shareholder | Date: | Signature of Shareholder | Date: | |||||||
Note:Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. |