<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material pursuant to Rule 14a-11(c) or Rule
14a-12
[ ] Confidential, for Use of the Commission Only (as Permitted
by Rule 14a-6(e)(2))
CHEMICAL FINANCIAL CORPORATION
- ---------------------------------------------------------------------------
(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):
--------------------------------------------------------------------
<PAGE>
(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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<PAGE>
MARCH 6, 1998
[CHEMICAL FINANCIAL CORPORATION LOGO]
333 EAST MAIN STREET
MIDLAND, MICHIGAN 48640
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 20, 1998
TO THE HOLDERS OF COMMON STOCK:
The annual meeting of shareholders of CHEMICAL FINANCIAL CORPORATION
("Chemical") will be held on MONDAY, APRIL 20, 1998 at 2:00 p.m. (local
time) at the Midland Center for the Arts, 1801 W. St. Andrews Drive,
Midland, Michigan, at which meeting the shareholders will (i) elect a board
of eight directors; (ii) vote upon approval of an amendment to the Restated
Articles of Incorporation to increase the number of authorized shares of
Common Stock; (iii) vote upon approval of an amendment to the Restated
Articles of Incorporation to change the par value of Common Stock; and (iv)
transact any other business that may properly be brought before the meeting.
You are invited to attend the meeting and, even though you sign and
return the enclosed proxy, you may vote your stock in person if you are
present at the meeting.
The Board of Directors has fixed the close of business on February 20,
1998 as the record date for the determination of holders of Common Stock
entitled to notice of and to vote at the meeting and any adjournment of the
meeting. The following Proxy Statement and enclosed form of proxy are
being furnished to holders of Chemical Common Stock on and after March 6,
1998.
By Order of the Board of Directors
/s/David B. Ramaker
David B. Ramaker
Secretary
It is important that your shares be represented at the meeting.
even if you expect to attend the meeting,
PLEASE SIGN, DATE AND RETURN YOUR PROXY PROMPTLY.
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<PAGE>
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
CHEMICAL FINANCIAL CORPORATION
APRIL 20, 1998
The enclosed proxy is being solicited by the Board of Directors of
Chemical Financial Corporation ("Chemical" or the "Corporation"). This
Proxy Statement and the enclosed proxy are being furnished to holders of
Chemical Common Stock, $10 par value ("Common Stock"), on and after March
6, 1998, for use at the annual meeting of Chemical shareholders to be held
on April 20, 1998 and any adjournment of that meeting. The annual meeting
will be held at the Midland Center for the Arts, 1801 W. St. Andrews Drive,
Midland, Michigan at 2:00 p.m. local time.
Solicitation of proxies will be made initially by mail. Directors,
officers and employees of Chemical and its subsidiaries may also solicit
proxies in person, by telephone or by electronic communication without
additional compensation. Proxies may be solicited by nominees and other
fiduciaries who may mail materials to, or otherwise communicate with, the
beneficial owners of Common Stock held by them. All expenses of
solicitation of proxies will be paid by Chemical.
Shareholders of record of the Corporation's Common Stock at the close
of business on February 20, 1998 will be entitled to notice of and to vote
at the annual meeting of shareholders on April 20, 1998 and any adjournment
of that meeting. As of February 20, 1998, there were 10,767,000 shares of
Common Stock issued and outstanding. Representation of the holders of a
majority of the shares of Common Stock outstanding at the record date is
necessary to constitute a quorum at the annual meeting. Abstentions and
broker non-votes are counted for purposes of determining the presence or
absence of a quorum for the transaction of business. Each share of Common
Stock is entitled to one vote on each matter presented for shareholder
action.
The shares represented by the enclosed proxy will be voted at the
annual meeting and any adjournment of that meeting if the proxy is properly
signed and returned to Chemical prior to the date of the meeting. A proxy
may be revoked at any time prior to its exercise by written notice
delivered to the Secretary of the Corporation or by attending and voting at
the annual meeting. The shares represented by each proxy will be voted in
accordance with the specifications of the shareholder. If the shareholder
does not specify a choice, the shares represented by the proxy will be
voted "FOR" the election of all nominees listed in this Proxy Statement as
directors, "FOR" approval of the proposal to amend the Corporation's
Restated Articles of Incorporation to increase the authorized capital stock
from 15,000,000 shares to 18,000,000 shares, "FOR" approval of the proposal
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<PAGE>
to amend the Corporation's Restated Articles of Incorporation to change the
par value of the authorized capital stock from $10 per share to $1 per share
and in accordance with the judgment of the persons named as proxies on any
other matter that may come before the meeting.
The 1997 Annual Report of the Corporation, including financial
statements, is enclosed with this Proxy Statement. A COPY OF THE
CORPORATION'S ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION ON
FORM 10-K FOR THE YEAR 1997, INCLUDING THE FINANCIAL STATEMENTS AND THE
FINANCIAL STATEMENT SCHEDULES, WILL BE PROVIDED, WITHOUT CHARGE, TO ANY
SHAREHOLDER UPON WRITTEN REQUEST. REQUESTS SHOULD BE MADE IN WRITING
ADDRESSED TO LORI A. GWIZDALA, CHIEF FINANCIAL OFFICER, CHEMICAL FINANCIAL
CORPORATION, 333 EAST MAIN STREET, MIDLAND, MICHIGAN 48640.
ELECTION OF DIRECTORS
The Board of Directors has nominated the individuals listed below for
election as directors of the Corporation to serve until the next annual
meeting of shareholders or until their successors are elected and
qualified. The proposed nominees are willing to be elected and to serve. In
the event that any nominee is unable to serve or is otherwise unavailable
for election, which is not contemplated, the incumbent Chemical Board of
Directors may or may not select a substitute nominee. If a substitute
nominee is selected, all proxies will be voted for the person so selected.
If a substitute nominee is not selected, all proxies will be voted for the
election of the remaining nominees. Proxies will not be voted for a greater
number of persons than the number of nominees named in this Proxy
Statement. A plurality of the shares represented and voted at the meeting
is required to elect directors. For the purpose of counting votes on the
election of directors, abstentions, broker non-votes and other shares not
voted will not be counted as shares voted, and the number of votes of which
a plurality is required will be reduced by the number of shares not voted.
Each nominee is currently a member of the Board of Directors. Each nominee
was elected at the Corporation's prior annual shareholders' meeting held
April 21, 1997, except for Mr. Moore who was appointed a director effective
January 20, 1998.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
ELECTION OF ALL NOMINEES AS DIRECTORS
Biographical information concerning each nominee for election to the
Board of Directors is presented below. Unless otherwise indicated, each
nominee has had the same principal occupation for more than five years. In
this Proxy Statement, "Chemical Bank" means Chemical Bank and Trust Company
in Midland, Michigan, the Corporation's principal banking subsidiary.
-5-
<PAGE>
NOMINEES FOR ELECTION
TO SERVE UNTIL
THE ANNUAL MEETING OF SHAREHOLDERS IN 1999
JAMES A. CURRIE, age 39, has been a director of the Corporation since
August 1993 and is a member of the Audit and Compensation Committees. Mr.
Currie is a certified teacher and, over the past five years, has served in
this capacity in a number of school districts in the Lansing, Michigan
area. During this period, Mr. Currie also pursued a Masters Degree in
Special Education at Michigan State University, which he obtained in
December 1994. Mr. Currie has served as a director and member of various
committees of Chemical Bank since February 1992.
MICHAEL L. DOW, age 63, has served as a director of the Corporation since
April 1985 and is Chairman of the Audit and a member of the Pension and
Compensation Committees. Mr. Dow is Chairman of the Board and owner of
General Aviation, Inc. in Lansing, Michigan, a provider of aviation related
services. Mr. Dow was elected to the Board of Directors of The Dow Chemical
Company in January 1988. Mr. Dow has served as a director and member of
various committees of Chemical Bank since February 1982.
TERENCE F. MOORE, age 54, has served as a director of the Corporation since
January 20, 1998 and is a member of the Audit Committee. Mr. Moore has
been the President and Chief Executive Officer of MidMichigan Health, in
Midland, Michigan since 1982. MidMichigan Health is a health care
organization operating three hospitals, two nursing homes and seven other
health care subsidiaries in central and northern Michigan. Mr. Moore is
also a director of the Michigan Molecular Institute. Mr. Moore has served
as a director and member of various committees of Chemical Bank since
February 1991 and as a director of CFC Data Corp, the Corporation's data
processing subsidiary, since June 1995.
ALOYSIUS J. OLIVER, age 57, has served as Chief Executive Officer,
President and a director of the Corporation since January 1997 and as
Executive Vice President and Secretary from January 1985 to December 1996.
Mr. Oliver joined the Corporation from Chemical Bank in January 1985. Mr.
Oliver joined Chemical Bank in 1957 and served in various management
capacities. Mr. Oliver became Vice President and Cashier of Chemical Bank
in 1975, Secretary of the Board of Directors in 1979 and Senior Vice
President in 1981. Mr. Oliver was elected to the Board of Directors of
Chemical Bank in August 1996. Mr. Oliver serves as a director and member of
various committees of the Corporation's subsidiaries, as follows: Chemical
Bank Michigan (also Chairman), Chemical Bank Key State, Chemical Bank South
and CFC Data Corp (also President and Treasurer), all of which are
wholly-owned subsidiaries of the Corporation.
ALAN W. OTT, age 66, has served as Chairman of the Board since April 1994
and a director of the Corporation since October 1973. Mr. Ott was Chief
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<PAGE>
Executive Officer and President from October 1973 until his retirement on
December 31, 1996. Mr. Ott was Treasurer from May 1987 through April 1994.
Mr. Ott is a member of the Pension Committee. Mr. Ott is also Chairman of the
Board of Directors of Chemical Bank and a director of Chemical Bank Thumb
Area, a wholly-owned subsidiary of the Corporation. Mr. Ott joined Chemical
Bank as Cashier in 1962, became a Vice President in 1964, President and Chief
Executive Officer in 1972 and Chairman of the Board and Chief Executive
Officer in 1986. He has served as a director of Chemical Bank since 1969 and
a director of Chemical Bank Thumb Area since May 1996. Mr. Ott retired as
Chief Executive Officer of Chemical Bank on December 31, 1996. During the
last five years, Mr. Ott has also served as a director and member of various
committees of all of the Corporation's other subsidiaries. Mr. Ott is a
director of the Michigan Molecular Institute, a director of the Economic
Development Corporation of the County of Midland and a trustee of Albion
College.
FRANK P. POPOFF, age 62, has served as a director of the Corporation since
February 1989 and is a member of the Audit and Chairman of the Pension and
Compensation Committees. Mr. Popoff is Chairman of the Board of Directors
of The Dow Chemical Company in Midland, Michigan, a diversified
manufacturer of chemicals and performance products, plastics, hydrocarbons
and energy, and consumer specialty products. Mr. Popoff joined The Dow
Chemical Company in 1959 and has served in senior positions in sales,
marketing, operations and business management, including responsibilities
for international areas of the company. Mr. Popoff was named President of
Dow Europe in 1981, became a Vice President in 1984, Executive Vice
President in 1985, President and Chief Executive Officer in 1987 and
Chairman of the Board of Directors in December 1992. He was elected to the
Board of Directors of The Dow Chemical Company in 1982. Mr. Popoff is also
a director of the Michigan Molecular Institute, American Express Company, US
WEST, Inc. and United Technologies Corporation. Mr. Popoff has served as a
director and member of various committees of Chemical Bank since July 1985.
LAWRENCE A. REED, age 58, has served as a director of the Corporation since
December 1986 and is a member of the Audit and Compensation Committees. Mr.
Reed retired in 1992 after serving as President of Dow Corning Corporation,
a diversified company specializing in the development, manufacture and
marketing of silicones and related silicon-based products. Mr. Reed joined
Dow Corning Corporation in 1964 and served in various senior management
positions, including Vice President and Chief Financial Officer and
President and Chief Executive Officer. Mr. Reed has served as a director
and member of various committees of Chemical Bank since December 1981.
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<PAGE>
WILLIAM S. STAVROPOULOS, age 58, has been a director of the Corporation
since August 1993 and is a member of the Audit, Pension and Compensation
Committees. Mr. Stavropoulos is President and Chief Executive Officer of
The Dow Chemical Company, a diversified manufacturer of chemicals and
performance products, plastics, hydrocarbons and energy, and consumer
specialty products. Mr. Stavropoulos joined The Dow Chemical Company in
1967 and has served in various senior management positions. Mr.
Stavropoulos was named President of Dow Latin America in 1984, Group Vice
President in 1987, Vice President in 1990, President of Dow U.S.A. in 1990,
Senior Vice President in 1991, President and Chief Operating Officer in
1993 and Chief Executive Officer in November 1995. He was elected to the
Board of Directors of The Dow Chemical Company in 1990. Mr. Stavropoulos is
also a director of Dow Corning Corporation, NCR Corporation and Bell South
Corporation. Mr. Stavropoulos has served as a director and member of
various committees of Chemical Bank since April 1992.
AMENDMENT OF THE RESTATED ARTICLES OF INCORPORATION
TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
The Board of Directors proposes to amend Article III of the
Corporation's Restated Articles of Incorporation to increase the
Corporation's authorized capital stock from 15,000,000 shares of Common
Stock to 18,000,000 shares of Common Stock. The purpose of the amendment
is to provide additional shares for future issuance.
As of February 6, 1998, 10,774,463 authorized shares of Common
Stock were issued and outstanding. The Board of Directors believes that
it is advisable to have the additional authorized shares available for
possible future stock splits and dividends, employee benefit plans,
equity-based acquisitions and other corporate purposes that might be
proposed in the future. The Board of Directors has authorized the
issuance of shares for such purposes in the past. However, the
Corporation has no present plans or proposals to issue shares that would
be authorized by the proposed amendment.
Management continues to seek favorable acquisition opportunities. It
has in the past had, and anticipates that it will from time to time in the
future have, discussions with other organizations that might be interested
in being acquired. Authorized but unissued shares of Common Stock, or
funds raised in a public offering of shares, may be used for these purposes.
All of the additional shares resulting from the increase in the number
of authorized shares of the Corporation's Common Stock would be of the same
class, with the same dividend, voting and liquidation rights, as the shares
of Common Stock presently outstanding. Shareholders have no preemptive
rights to acquire shares issued by the Corporation under its existing
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<PAGE>
Restated Articles of Incorporation, and shareholders would not acquire any
such rights with respect to such additional shares under the proposed
amendment to the Corporation's Restated Articles of Incorporation. Under
some circumstances, issuance of additional shares of Common Stock could
dilute the voting rights, equity and earnings per share of existing
shareholders.
If the proposed amendment is adopted, the newly authorized shares
would be unreserved and available for issuance. No further shareholder
authorization would be required prior to the issuance of such shares by the
Corporation.
This increase in authorized but unissued Common Stock could be
considered an anti-takeover measure because the additional authorized but
unissued shares of Common Stock could be used by the Board of Directors to
make a change in control of the Corporation more difficult. The Board of
Directors' purpose in recommending this proposal is not as an anti-takeover
measure, but for the reasons discussed above.
Article III of the Corporation's Restated Articles of Incorporation
would be amended to change the number of authorized shares of Common
Stock from 15,000,000 shares to 18,000,000 shares.
The affirmative vote of holders of a majority of the outstanding
shares entitled to vote at the annual meeting is required to approve the
proposed amendment to the Corporation's Restated Articles of Incorporation.
For the purpose of counting votes on this proposal, abstentions, broker
non-votes and other shares not voted have the same effect as a vote against
the proposal.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
APPROVAL OF THE AMENDMENT TO THE CORPORATION'S
RESTATED ARTICLES OF INCORPORATION
AMENDMENT OF THE RESTATED ARTICLES OF INCORPORATION
TO REDUCE PAR VALUE TO $1.00 PER SHARE
The Board of Directors proposes to amend the Corporation's Restated
Articles of Incorporation as appropriate to reduce the par value of the
Corporation's Common Stock from $10.00 per share to $1.00 per share. The
purpose of the amendment is to enhance the comparability of the financial
and other information reported by the Corporation and its industry peers.
The concept of par value no longer has any legal significance under the
Michigan Business Corporation Act, as amended (the "Michigan Act").
As of February 6, 1998, 10,774,463 authorized shares of Common
Stock were issued and outstanding. The Board of Directors believes that
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<PAGE>
the current par value of the Corporation's Common Stock is significantly
higher than the par values of the stocks of many of the financial
institutions to which the Corporation and others compare the financial
results of the Corporation. Although the concept of par value has no legal
significance under the Michigan Act, par value can continue to cause
certain corporate actions to affect the structure of the Corporation's
capital accounts. By having a relatively high par value for its Common
Stock, certain actions such as stock splits can have a greater impact on the
structure of the Corporation's capital accounts than the identical actions
would have upon other financial institutions having lower par values for
their stocks. The Board of Directors believes that such distinctions
resulting solely due to differences in the levels of par value are
artificial. The Board of Directors therefore believes that it is
advisable to reduce the par value of the Corporation's Common Stock to
enhance the comparability of the financial and other information reported
by the Corporation and its industry peers.
The Corporation's Restated Articles of Incorporation would be amended
as appropriate so that any reference to the par value of Common Stock in
the Restated Articles of Incorporation would be changed from $10.00 per
share to $1.00 per share. The change will not require shareholders to
surrender or exchange existing stock certificates.
The affirmative vote of holders of a majority of the outstanding shares
entitled to vote at the annual meeting is required to approve the proposed
amendment to the Corporation's Restated Articles of Incorporation. For the
purpose of counting votes on this proposal, abstentions, broker non-votes
and other shares not voted have the same effect as a vote against the
proposal.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
APPROVAL OF THE AMENDMENT TO THE CORPORATION'S
RESTATED ARTICLES OF INCORPORATION
VOTING SECURITIES
Listed below is the only shareholder of the Corporation known by
management to have been the beneficial owner of 5% or more of the
outstanding shares of Common Stock as of February 6, 1998:
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<PAGE>
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP<F1>
---------------------------------------------
NAME AND ADDRESS SOLE VOTING SHARED VOTING TOTAL
OF BENEFICIAL AND DISPOSITIVE OR DISPOSITIVE BENEFICIAL PERCENT OF
OWNER OF COMMON STOCK POWER POWER<F2> OWNERSHIP CLASS
--------------------- --------------- -------------- ----------- ----------
<S> <C> <C> <C> <C>
Chemical Bank and Trust Company 764,634 161,809 926,443 8.55%
Trust Department<F3>
333 E. Main Street
Midland, MI 48640
</TABLE>
The following table sets forth information regarding beneficial
ownership of Common Stock by each director and nominee for director, each
named executive officer and all directors and executive officers as a group
as of February 6, 1998:
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP<F1>
---------------------------------------------
SOLE VOTING SHARED VOTING TOTAL
NAME OF BENEFICIAL AND DISPOSITIVE OR DISPOSITIVE BENEFICIAL PERCENT OF
OWNER OF COMMON STOCK POWER POWER<F2> OWNERSHIP CLASS
--------------------- --------------- -------------- ---------- ----------
<S> <C> <C> <C> <C>
L. E. Burks 28,907<F4> 51,202<F5> 80,109<F4><F5> <F*>
J. A. Currie 66,796 10,122 76,918 <F*>
M. L. Dow 60,623 53,589<F6> 114,212<F6> 1.05%
B. M. Groom 21,334<F4> 10,726 32,060<F4> <F*>
L. A. Gwizdala 21,792<F4> 13,210 35,002<F4> <F*>
T. F. Moore 2,962 2,137 5,099 <F*>
A. J. Oliver 76,229<F4> -- 76,229<F4> <F*>
A. W. Ott 59,486 302,267<F7> 361,753<F7> 3.34
F. P. Popoff 5,049 -- 5,049 <F*>
D. B. Ramaker 5,161<F5> -- 5,161<F4> <F*>
L. A. Reed 2,502 11,420 13,922 <F*>
W. S. Stavropoulos 3,168 230,150<F8> 233,318<F8> 2.15
All directors and executive
officers as a group 379,700<F9> 455,113 834,813<F9> 7.70
- ---------------------------
<FN>
<F*>Less than 1%
<F1> The numbers of shares stated are based on information furnished by
each person listed and include shares personally owned of record by
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<PAGE>
that person and shares that, under applicable regulations, are
considered to be otherwise beneficially owned by that person. Under
these regulations, a beneficial owner of a security includes any
person who, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares voting power
or dispositive power with respect to the security. Voting power
includes the power to vote or direct the voting of the security.
Dispositive power includes the power to dispose or direct the
disposition of the security. A person will also be considered the
beneficial owner of a security if the person has a right to acquire
beneficial ownership of the security within 60 days. Shares held in
various fiduciary capacities through the trust department of Chemical
Bank are not included unless otherwise indicated. The Corporation and
the directors and officers of the Corporation and of Chemical Bank
disclaim beneficial ownership of shares held by the trust department
in fiduciary capacities.
<F2> These numbers include shares over which the listed person is legally
entitled to share voting or dispositive power by reason of joint
ownership, trust, or other contract or property right, and shares held
by spouses and children over whom the listed person may have
influence by reason of relationship. Shares held in fiduciary capacities
by the trust department of Chemical Bank are not included unless
otherwise indicated. The directors and officers of the Corporation may,
by reason of their positions, be in a position to influence the voting
or disposition of shares held in trust by Chemical Bank to some degree,
but disclaim beneficial ownership of these shares.
<F3> These numbers consist of certain shares held in various fiduciary
capacities through the trust department of Chemical Bank. Although
Chemical Bank has voting or dispositive powers with respect to these
shares, it is the trust department's policy to transfer voting rights
by proxy to the beneficiaries whenever possible. Chemical Bank also
holds in various fiduciary capacities a total of 1,197,855 shares of
Common Stock over which it does not have voting or dispositive power
and which are not included in these numbers. Although Messrs. Burks,
Groom and Ramaker are members of Chemical Bank's Trust Investment
Committee, they disclaim beneficial ownership of shares held by the
trust department in a fiduciary capacity. The Corporation and the
directors and officers of the Corporation and Chemical Bank also
disclaim beneficial ownership of shares held by the trust department
in a fiduciary capacity.
<F4> These numbers include shares that executive officers of the
Corporation have the right to acquire through the exercise of stock
options within 60 days from February 6, 1998 as follows: Mr. Burks -
5,721 shares, Mr. Groom - 16,891 shares, Ms. Gwizdala - 21,348 shares,
Mr. Ramaker - 3,514 shares and Mr. Oliver - 12,594 shares.
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<F5> These numbers include 33,093 shares which the Charles J. Strosacker
Foundation owned as of February 6, 1998. Mr. Burks is a trustee,
treasurer and member of the Investment Committee of that foundation.
Mr. Burks has no beneficial interest in the shares owned by the
foundation and disclaims beneficial ownership of these shares.
<F6> These numbers include 48,234 shares owned by two trusts as of February
6, 1998, of which Mr. Dow is a trustee. Mr. Dow disclaims beneficial
ownership of these shares.
<F7> These numbers include 230,150 shares which the Rollin M. Gerstacker
Foundation owned and 40,617 shares owned by the Elsa U. Pardee
Foundation, as of February 6, 1998. Mr. Ott is a trustee and treasurer
of both of these foundations. Mr. Ott has no beneficial interest in
the shares owned by the foundations and disclaims beneficial ownership
of these shares.
<F8> These numbers include 230,150 shares which the Rollin M. Gerstacker
Foundation owned as of February 6, 1998. Mr. Stavropoulos is a trustee
of that foundation. Mr. Stavropoulos has no beneficial interest in the
shares owned by the foundation and disclaims beneficial ownership of
these shares.
<F9> These numbers include 69,284 shares that the executive officers of the
Corporation have the right to acquire presently or within 60 days from
February 6, 1998, through the exercise of stock options granted by the
Corporation.
</FN>
</TABLE>
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Corporation has standing Audit, Pension and Compensation
Committees of the Board of Directors. The Corporation does not have a
nominating committee.
The Audit Committee, composed of Mr. Dow, Chairman, and Messrs.
Currie, Moore, Popoff, Reed and Stavropoulos, met two times during 1997.
This committee recommends a firm of independent public accountants to be
appointed by the Board; consults with the independent public accountants
and the internal auditors with regard to the adequacy of internal controls
and the quality of ongoing operations; reviews with the independent public
accountants significant accounting matters and policies, the proposed plan
of audit and the results of their audit; and submits a formal annual report
to the Board of Directors covering the adequacy, effectiveness and
efficiency of the internal systems of control and the quality of ongoing
operations.
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<PAGE>
The Pension Committee, composed of Mr. Popoff, Chairman, and Messrs.
Dow, Ott and Stavropoulos, met once during 1997. This committee oversees
the administration of the Corporation's employees' pension plan.
The Compensation Committee, composed of Mr. Popoff, Chairman, and
Messrs. Currie, Dow, Reed and Stavropoulos, met once during 1997. This
committee reviews salaries, bonuses and other compensation of all officers
of the Corporation, administers the Corporation's stock option plans and
makes recommendations to the Board regarding the awards of stock options
under these plans.
The Board of Directors meets regularly each month for approximately
two hours. There were a total of twelve meetings in 1997. All directors
attended 75% or more of the aggregate of Board and applicable committee
meetings of which they were members during 1997, except for Mr.
Starvropoulos.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
The following table provides information concerning the compensation
earned during each of the three years in the period ended December 31,
1997, by the Chief Executive Officer and each of the Corporation's other
executive officers whose total annual salary and bonus for 1997 exceeded
$100,000:
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG TERM COMPENSATION
---------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
---------------------------------- ---------------------- -------
NUMBER OF
NAME AND OTHER RESTRICTED SHARES
PRINCIPAL ANNUAL STOCK UNDERLYING LTIP ALL OTHER
POSITION YEAR SALARY BONUS COMPENSATION AWARDS OPTIONS PAYOUTS COMPENSATION<F1>
-------- ---- ------ ----- ------------ ------ ------- ------- ----------------
<S> <C> <C> <C> <C> <C>
Aloysius J. Oliver 1997 $140,000 $35,150 2,100 $ 60
Chief Executive 1996 94,000 25,150 4,410 60
Officer and Presi- 1995 87,700 20,150 60
dent of the
Corporation
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<PAGE>
David B. Ramaker 1997 $130,000 $30,150 2,100 $ 468
President and 1996 90,000 16,150 4,410 417
Chief Executive 1995 82,000 5,650 401
Officer of Chemical
Bank and Executive
Vice President and
Secretary of the
Corporation
Lawrence E. Burks 1997 $123,000 $25,150 $ 60
Vice Chairman of 1996 118,500 23,150 60
Chemical Bank 1995 114,000 21,150 60
Bruce M. Groom 1997 $ 97,500 $24,150 $1,203
Senior Vice Presi- 1996 94,000 21,150 2,205 1,275
dent and Senior 1995 90,300 19,150 875
Trust Officer of
Chemical Bank
Lori A. Gwizdala 1997 $ 90,000 $28,150 2,100 $ 294
Senior Vice Presi- 1996 76,000 23,150 2,205 247
dent, Chief Finan- 1995 70,000 19,150 228
cial Officer and
Treasurer of the
Corporation
<FN>
_________________
<F1> Dollar value of term life insurance premiums paid by the Corporation.
</FN>
</TABLE>
The following table sets forth information concerning stock options
granted to the specified individuals during the last fiscal year:
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
NUMBER OF PERCENT OF TOTAL OF STOCK PRICE
SHARES OPTIONS APPRECIATION FOR OPTION
UNDERLYING GRANTED TO EXERCISE TERM
OPTIONS EMPLOYEES IN PRICE EXPIRATION --------------------------
NAME GRANTED<F1> FISCAL YEAR PER SHARE<F1> DATE 0% 5% 10%
- ------------------- ----------- ---------------- ------------- ---------- --------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Aloysius J. Oliver 2,100 29.63% $38.93 11/17/2007 $0 $51,408 $130,284
David B. Ramaker 2,100 29.63 38.93 11/17/2007 0 51,408 130,284
Lori A. Gwizdala 2,100 29.63 38.93 11/17/2007 0 51,408 130,284
-15-
<PAGE>
<FN>
__________________
<F1> The per share exercise price of each option is equal to the market
value of Common Stock on the date each option is granted. The
outstanding options were granted for a term of 10 years. Options
terminate, subject to certain limited exercise provisions, in the
event of death, retirement or other termination of employment. All
options are exercisable one year from the date of grant, except for
Mr. Ramaker's, which are exercisable three years from the date of
grant. All options permit the option price to be paid by delivery of
cash or other shares of Common Stock owned by the option holder,
including shares acquired through the exercise of other options. The
number of shares underlying options and the exercise price have been
adjusted to reflect a 5% stock dividend distributed December 30, 1997.
</FN>
</TABLE>
The following table provides information concerning options exercised
during 1997 and unexercised options held as of December 31, 1997, by the
listed individuals:
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED
NUMBER OF UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES ACQUIRED OPTIONS AT FISCAL YEAR-END OPTIONS AT FISCAL YEAR-END<F2>
ON -------------------------- ------------------------------
NAME EXERCISE<F1> VALUE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------ -------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Aloysius J. Oliver 2,625 $51,385 12,594 2,100 $238,681 $ 12,225
David B. Ramaker 525 15,470 3,514 10,767 108,911 145,296
Lawrence E. Burks 154 3,941 5,721 128,768
Bruce M. Groom 525 16,927 16,891 446,478
Lori A. Gwizdala 2,835 71,434 24,171 2,100 640,282 12,225
<FN>
_______________
<F1> The number of shares shown is the gross number of shares covered by
options exercised. Officers may deliver other shares owned in payment
of the option price and shares may be withheld for tax withholding
purposes, resulting in a smaller net increase in their share holdings.
<F2> The values reported are based on a fair market value of $44.75 per
share, the closing bid price of Common Stock on The Nasdaq Stock
Market on December 31, 1997.
</FN>
</TABLE>
-16-
<PAGE>
STOCK OPTION PLANS. The Chemical Financial Corporation 1987 Award and
Stock Option Plan ("1987 Plan") and the Stock Incentive Plan of 1997 ("1997
Plan") provide for awards of nonqualified stock options, incentive stock
options, stock appreciation rights, or a combination thereof.
The 1997 Plan was approved by the shareholders at the April 21, 1997
annual meeting of shareholders. At the April 20, 1992 annual meeting of
shareholders, the shareholders voted to increase the authorized shares
issuable under the 1987 Plan by 100,000 shares and extend the Plan to April
20, 1997. As of December 31, 1997, there were options outstanding to
purchase 341,257 shares of the Corporation's Common Stock under the 1997
and 1987 Plans, and 517,913 shares available for future awards under the
1997 Plan.
Key employees of the Corporation and its subsidiaries, as the
Compensation Committee of the Board of Directors may select from time to
time, are eligible to receive awards under the 1997 Plan. No employee of
the Corporation may receive any awards under the 1997 Plan while the
employee is a member of the Compensation Committee.
The plans provide that the option price of incentive stock options
awarded shall not be less than the fair market value of Common Stock on the
date of grant. Historically, options granted under the plans are first
exercisable from one to five years from the date of grant, at the discretion
of the Compensation Committee, and expire not later than ten years and one
day after the date of grant. Options granted may be designated nonqualified
stock options or incentive stock options. Options granted may include stock
appreciation rights that entitle the recipient to receive cash or a number of
shares of Common Stock without payment to the Corporation that have a market
value equal to the difference between the option price and the market price
of the total number of shares awarded under the option at the time of
exercise of the stock appreciation right. The plans provide, at the
discretion of the Corporation Committee, that payment for exercise of an
option may be made in the form of shares of stock of the Corporation having
a fair market value equal to the exercise price of the option at the time
of exercise, or in cash. The plans also provide for the payment of the
required tax withholding generated upon the exercise of a nonqualified
stock option in the form of shares of stock of the Corporation having a
fair market value equal to the amount of the required tax withholding at
the time of exercise, upon prior approval and at the discretion of the
Compensation Committee.
PENSION PLAN. The Corporation and its subsidiaries make annual
contributions to the Chemical Financial Corporation Employees' Pension Plan
("Pension Plan"), which is a defined benefit plan qualified under the
Internal Revenue Code of 1986, as amended (the "Code"). The Corporation has
the authority to terminate the Pension Plan at any time. Sections 401(a)(17)
and 415 of the Code limit the annual benefits that may be paid from a
-17-
<PAGE>
tax-qualified retirement plan. As permitted by the Employee Retirement Income
Security Act of 1974, the Corporation has established a supplemental pension
plan that provides for the payment to certain executive officers of the
Corporation, as determined by the Compensation Committee, benefits to which
they would have been entitled, calculated under the provisions of the Pension
Plan, as if the limits imposed by the Code did not apply.
The following table shows the estimated combined annual pension
benefits that would be payable under the Pension Plan and supplemental
pension plan to salaried employees, including the named executive officers,
at the various salary levels with the number of years of credited service
under the Pension Plan listed in the table upon normal retirement in 1998.
The "Average Remuneration" is the average annual base salary, excluding any
bonus, for the five highest consecutive years during the ten years
preceding the date of retirement.
<TABLE>
PENSION PLAN TABLE
<CAPTION>
YEARS OF SERVICE
-----------------------------------------------------------
30 OR
AVERAGE REMUNERATION 10 15 20 25 MORE
-------------------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
$ 70,000 $12,118 $18,176 $24,234 $30,293 $36,351
80,000 14,017 21,026 28,034 35,043 42,051
90,000 15,917 23,876 31,834 39,793 47,751
100,000 17,818 26,726 35,634 44,543 53,451
110,000 19,717 29,576 39,434 49,293 59,151
125,000 22,567 33,851 45,134 56,418 67,701
150,000 27,317 40,976 54,634 68,293 81,951
175,000 32,068 48,101 64,134 80,168 96,201
</TABLE>
The Pension Plan covers the annual base salary of all salaried
employees as of January 1 of each year. Upon retirement at age 65, a
retiree will receive an annual benefit of 1.52% of his or her average
annual base salary for the five highest consecutive years during the ten
years preceding his or her date of retirement, plus .38% of average annual
pay in excess of covered compensation, multiplied by the retiree's number
of years of credited service (subject to a maximum of 30 years). Benefits
at retirement ages under 65 are also determined based upon length of
service and pay, as adjusted in accordance with the Pension Plan. The
Pension Plan provides for vesting of benefits after attaining five years
of service, for disability and death benefits and for optional joint and
survivor benefits for the employee and his or her spouse.
-18-
<PAGE>
The amount shown under the caption "Salary," excluding the amount
shown under the caption "Bonus," in the Summary Compensation Table in this
Proxy Statement is representative of the most recent calendar year
compensation used in calculating average remuneration under the Pension
Plan. As of December 31, 1997, Mr. Oliver had 30 years of credited service
(the maximum) under the Pension Plan, Mr. Ramaker had 8.2 years, Mr. Burks
had 24.8 years, Mr. Groom had 12.7 years and Ms. Gwizdala had 13 years of
credited service under the Pension Plan.
The retirement benefits shown in the preceding Pension Plan Table are
based on the assumption that an employee retires in 1998 at normal
retirement age and will elect a benefit for his or her life with 120
monthly payments guaranteed. If the employee were to elect a benefit
payable to a surviving spouse of 50% or more of the employees' retirement
benefit or for the employees' life only, the retirement benefit for the
employee would be adjusted. The benefits listed in the Pension Plan Table
are not subject to a deduction for Social Security or any other offset
amount.
DIRECTOR COMPENSATION. During 1997, the Corporation paid director fees
of $700 per meeting attended and committee fees of $350 per meeting attended
to all of its directors who were not regular salaried employees of the
Corporation. Regular salaried employees of the Corporation or its
subsidiaries do not receive fees for serving on, or attending meetings of,
the Board of Directors of the Corporation or its subsidiaries or meetings
of any of their committees.
The Board of Directors has adopted the Chemical Financial Corporation
Plan for Deferral of Directors' Fees. This plan is available to all
directors of the Corporation and its subsidiaries who receive fees. Under
the plan, directors must elect before December 31 of each year to defer
either 50% or 100% of fees to be earned in the following year. These fees
will be paid out in any number of calendar years from one to ten commencing
during or following the year the director ceases to be a director or the
year after the director attains age 70. During the deferral period, the
plan provides that the Corporation shall accrue to the directors' credit
interest on the accumulated amount of deferred fees at the rate paid by
Chemical Bank on a variable rate money market savings account.
Effective December 31, 1996, the Corporation entered into a Retirement
Agreement with Mr. Ott. Under that agreement, the Corporation agreed to pay
Mr. Ott an annual salary of $50,000 and provide group health benefits
consistent with those available under Chemical's retiree medical and dental
plan. Mr. Ott agreed to continue to serve as Chairman of the Board of
Directors of the Corporation and Chemical Bank and as a director of Chemical
Bank Thumb Area through December 31, 1997. Mr. Ott also agreed to a covenant
not to compete with the Corporation as long as payments were being made to him
under the agreement. The Corporation has renewed this agreement with Mr. Ott
-19-
<PAGE>
for the 1998 fiscal year, although under the renewal Mr. Ott is not required
to continue as a director of Chemical Bank Thumb Area.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Corporation's Board of Directors
reviews and determines the Corporation's compensation programs, including
individual salaries of executive and senior officers. The Compensation
Committee is composed of Messrs. Currie, Dow, Popoff, Reed and
Stavropoulos. All members are non-employee directors of the Corporation.
Under the supervision of the Compensation Committee, the Corporation
has developed and implemented compensation plans which seek to align the
financial interests of the Corporation's senior officers with those of its
shareholders. The Corporation's executive compensation program is comprised
of three primary components: base salary, annual cash incentive bonus
opportunities and longer-term incentive opportunities in the form of stock
option awards.
To attract and retain officers with exceptional abilities and talent,
annual base salaries are set to provide competitive levels of compensation
recognizing individual performance and achievements. Annual cash incentive
bonuses are used to reward senior officers for individual performance,
accomplishments and achievement of annual business targets. A significant
portion of potential career compensation is linked to corporate performance
through stock option awards.
The Compensation Committee determines the annual base salary,
incentive bonus and stock option awards for the Chief Executive Officer.
Annual base salary, incentive bonus and stock option awards with respect to
the Corporation's other senior officers are recommended by the Chief
Executive Officer to, and ultimately determined by, the Compensation
Committee. All other senior executives of the Corporation are eligible to
participate in the same executive compensation plans that are available to
the Chief Executive Officer.
In evaluating the performance of and determining the annual base
salary, incentive bonus and stock option awards for the Chief Executive
Officer and other senior management, the Compensation Committee takes into
account management's contribution to the long-term success of the
Corporation. The Compensation Committee considers return to shareholders to
be primary in measuring financial performance. The philosophy of the
Corporation is to maximize long-term return to shareholders consistent with
its commitments to maintain the safety and soundness of the institution and
provide the highest possible level of service at a fair price to the
customers and communities that it serves. The Compensation Committee has
taken these subjective and qualitative factors into account, along with
other quantitative measures of corporate performance, in establishing the
-20-
<PAGE>
annual salary, incentive bonus and stock option awards for the Chief
Executive Officer and the Corporation's other senior management, giving at
least equal weight to the subjective and qualitative factors and no
particular weight to any given factor. The determination of the size of
stock option awards is based upon a subjective analysis of each recipient's
position within the organization, his or her individual performance and his
or her growth potential within the organization. The number of stock option
awards previously granted to a recipient is not a factor considered in the
determination of the grant of a new stock option award.
The Compensation Committee primarily considers five quantitative
measures of corporate performance in establishing the compensation to be
paid to the Chief Executive Officer and the Corporation's other senior
management. These measures of performance are: (i) after-tax earnings per
share and earnings per share growth; (ii) the level of net loan losses;
(iii) capital position; (iv) targeted as compared to actual annual
operating performance; and (v) the Corporation's annual performance and
financial condition as compared to that of its Federal Reserve Bank peer
group. These measures were considered by the Compensation Committee in
determining each component of executive compensation, although no
particular weight was given to any specific factor.
Mr. Oliver's base salary for 1997 was established at the beginning of
the year to provide a competitive level of compensation and took into
account corporate performance through December 31, 1996. The Corporation's
performance during 1996 exceeded both its targeted goals and that of its
Federal Reserve Bank peer group.
Mr. Oliver's 1997 incentive bonus was established at the end of the
year based upon performance of the Corporation during 1997. The
Corporation's net income in 1997 exceeded targeted performance for 1997.
The Corporation achieved record earnings in 1997. In 1997, the
Corporation's earnings per share increased 8.3% over 1996 earnings per
share. Return on assets increased to 1.38% in 1997, compared to 1.30% in
1996. The Corporation achieved record earnings in 1997, even though the
Corporation added $752,000 to the reserve for future possible loan losses,
bringing the balance in the reserve to $17.4 million at December 31, 1997,
or 2.05% of total loans. Nonperforming loans represented .36% of total
loans outstanding as of December 31, 1997.
During 1997, the named executive officers were granted stock options to
purchase the following numbers of shares of Common Stock (adjusted for the 5%
stock dividend paid on December 30, 1997): Mr. Oliver - 2,100 shares, Mr.
Ramaker - 2,100 shares and Ms. Gwizdala - 2,100 shares. The Compensation
Committee granted stock options to purchase a total of 7,087 shares of Common
Stock to executive and other officers of the Corporation and its subsidiaries
during 1997.
-21-
<PAGE>
In 1993, Congress amended the Code to add Section 162(m). This
section provides that publicly held corporations may not deduct
compensation paid to certain executive officers in excess of $1 million
annually, with certain exemptions. The Compensation Committee has examined
the Corporation's executive compensation policies in light of Section 162(m)
and the regulations that have been adopted to implement that section.
It is not expected that any portion of the Corporation's deduction for
employee remuneration will be disallowed in 1998 or in future years by
reason of actions expected to be taken in 1998.
During 1997, all recommendations of the Compensation Committee were
unanimously approved by the Board of Directors without modification.
Submitted by the Compensation Committee of the Board of Directors:
Frank P. Popoff, Chairman Michael L. Dow William S. Stavropoulos
James A. Currie Lawrence A. Reed
FIVE-YEAR SHAREHOLDER RETURN COMPARISON
The following line graph compares the Corporation's cumulative total
shareholder return on its Common Stock over the last five years, assuming
the reinvestment of dividends, to the Standard and Poor's ("S&P") 500 Stock
Index and the KBW 50 Index. Both of these indices are also based upon total
return (including reinvestment of dividends) and are market-capitalization-
weighted indices. The S&P 500 Stock Index is a broad equity market index
published by Standard and Poor's. The KBW 50 Index is published by Keefe,
Bruyette & Woods, Inc., an investment banking firm that specializes in the
banking industry. The KBW 50 Index is composed of 50 money center and
regional bank holding companies. The line graph assumes $100 was invested on
December 31, 1992.
[GRAPH]
The dollar values for total shareholder return plotted in the graph
above are shown in the table below:
<TABLE>
<CAPTION>
CHEMICAL S&P
FINANCIAL KBW 50 500
DECEMBER 31 CORPORATION INDEX INDEX
----------- ----------- ----- -----
<S> <C> <C> <C> <C>
1992 $100.0 $100.0 $100.0
1993 118.4 105.5 110.1
1994 117.9 100.2 111.5
1995 173.8 160.4 153.5
1996 191.3 226.9 188.7
1997 233.0 331.7 251.6
</TABLE>
-22-
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Directors, officers, principal shareholders and their associates were
customers of, and had transactions (including loans and loan commitments)
with, the Corporation's banking subsidiaries in the ordinary course of
business during 1997. All such loans and commitments were made on
substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons
and did not involve more than a normal risk of collectibility or present
other unfavorable features. Similar transactions may be expected to take
place in the ordinary course of business in the future. None of these loan
relationships presently in effect are in default as of the date of this
Proxy Statement.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires
directors, officers and persons beneficially owning more than 10% of the
Corporation's Common Stock to file reports of ownership and changes in
ownership of shares of Common Stock with the Securities and Exchange
Commission. Directors, officers and greater than 10% beneficial owners are
required by Securities and Exchange Commission regulations to furnish the
Corporation with copies of all Section 16(a) reports they file. Based upon
its review of copies of Section 16(a) reports provided to it, or written
representations from certain reporting persons that no Form 5 reports were
required, the Corporation believes that, from January 1 through December
31, 1997, all applicable filing requirements were satisfied.
DIVIDEND REINVESTMENT PROGRAM SHARES
If a shareholder is enrolled in the Corporation's Dividend
Reinvestment Program, the enclosed proxy card covers: (1) all shares of
Common Stock owned directly by the shareholder at the record date, and (2)
all shares of Common Stock held for the shareholder in the Dividend
Reinvestment Program at that time. Harris Trust and Savings Bank, as the
shareholder's agent under the Dividend Reinvestment Program, will vote any
Common Stock held by it under the program in accordance with the
shareholder's written direction as indicated on the proxy card. All such
shares will be voted the way the shareholder directs. If no specific
instruction is given on a returned proxy, Harris Trust and Savings Bank
will vote as recommended by the Board of Directors.
-23-
<PAGE>
PROPOSALS FOR 1999 ANNUAL MEETING
Proposals of shareholders intended to be presented at the 1999 annual
meeting of shareholders of the Corporation must be made in accordance with
Securities and Exchange Commission Rule 14a-8 and must be received by the
Corporation by November 6, 1998, to be considered for inclusion in the
proxy statement and form of proxy relating to that meeting.
INDEPENDENT PUBLIC ACCOUNTANTS
Ernst & Young LLP served as the independent public accountants for the
Corporation for 1997 and, pursuant to the recommendation of the Audit
Committee, the Board of Directors reappointed them for the 1998 fiscal
year. In accordance with prior practice, representatives of Ernst & Young LLP
are expected to be present at the annual meeting of shareholders, will have the
opportunity to make a statement if they desire to do so and are expected to
be available to respond to appropriate questions.
OTHER MATTERS
Management does not intend to present to the meeting any business
other than the election of directors and the proposals for approval of
amendments to the Restated Articles of Incorporation to increase the number
of authorized shares of Common Stock and to change the par value of Common
Stock. If any matter not known to management at the time this Proxy
Statement was being prepared should be presented for action at the meeting,
the enclosed proxy will be voted in accordance with the judgment of the
persons named as proxies with respect to that matter.
By Order of the Board of Directors
David B. Ramaker
Secretary
March 6, 1998
-24-
<PAGE>
PROXY NO. SHARES IN YOUR NAME REINVESTMENT SHARES
[CHEMICAL FINANCIAL The undersigned hereby appoints Michael L. Dow, Alan
CORPORATION LOGO] W. Ott and Frank P. Popoff, jointly and severally,
proxies, with full power of substitution, to vote all
the shares of capital stock of CHEMICAL FINANCIAL
PROXY FOR CORPORATION which the undersigned may be entitled to
ANNUAL vote, including dividend reinvestment plan shares,
MEETING if any, held of record by the undersigned on
APRIL 20, 1998 February 20, 1998, at the Annual Meeting of
Shareholders of Chemical Financial Corporation to be
held at the Midland Center for the Arts, 1801 W. St.
Andrews, Midland, MI, on Monday, April 20, 1998, and
at any adjournments thereof, such proxies being
directed to vote as specified on the reverse side of
this card or, if no specification is made, FOR the
election of all nominees listed for directors, FOR
approval of the amendment to the Restated Articles
of Incorporation to change par value to $1.00 per
share, FOR approval of the amendment to increase
authorized capital to 18,000,000 shares and in
accordance with their discretion on such other
matters that may come before the meeting.
Please date this Proxy and sign exactly
as your name or names appear on the
card. If you are acting in a
representative capacity as attorney,
executor, administrator, trustee, or
guardian, please sign name and title.
Dated: ________________________, 1998
CONTINUED ON ________________________________________
REVERSE SIDE Signature
________________________________________
Signature
<PAGE>
[CHEMICAL FINANCIAL CORPORATION LOGO]
THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF THE CORPORATION FOR THE ANNUAL MEETING - APRIL 20, 1998
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS, JUST
SIGN THE REVERSE SIDE; NO BOXES NEED BE CHECKED. TO WITHHOLD AUTHORITY TO
VOTE OR TO OTHERWISE VOTE DIFFERENTLY, PLEASE INDICATE YOUR SPECIFICATIONS
BELOW.
- ---------------------------------------------------------------------------
[ ] FOR all nominees listed below [ ] AUTHORITY WITHHELD
JAMES A. CURRIE ALOYSIUS J. OLIVER LAWRENCE A. REED
MICHAEL L. DOW ALAN W. OTT WILLIAM S. STAVROPOULOS
TERENCE F. MOORE FRANK P. POPOFF
(INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through the nominee's name in the list above)
- ---------------------------------------------------------------------------
Approval of amendment to Restated Articles of Incorporation
to change par value to $1.00 per shares FOR [ ] AGAINST [ ] ABSTAIN [ ]
Approval of amendment to Restated Articles of Incorporation
to increase capital to 18,000,000 shares FOR [ ] AGAINST [ ] ABSTAIN [ ]
- ---------------------------------------------------------------------------
WHERE A VOTE IS NOT SPECIFIED, THE PROXIES WILL VOTE THE SHARES REPRESENTED
BY THIS PROXY FOR THE ELECTION OF ALL NOMINEES LISTED FOR DIRECTORS, FOR
APPROVAL OF THE AMENDMENT TO THE RESTATED ARTICLES OF INCORPORATION TO CHANGE
PAR VALUE TO $1.00 PER SHARE, FOR APPROVAL OF THE AMENDMENT TO THE RESTATED
ARTICLES OF INCORPORATION TO INCREASE AUTHORIZED CAPITAL TO 18,000,000 SHARES
AND IN ACCORDANCE WITH THEIR DISCRETION ON SUCH OTHER MATTERS THAT MAY COME
BEFORE THE MEETING.
- ---------------------------------------------------------------------------
[ ] Please place a check
here if you plan to attend
the Annual Meeting.
