<PAGE> 1
Filed pursuant to Rule 424(b)(2)
Registration No. 33-61053
PROSPECTUS SUPPLEMENT
(To Prospectus dated July 25, 1995)
$150,000,000
COMERICA INCORPORATED
7 1/4% SUBORDINATED NOTES DUE AUGUST 1, 2007
---------------------------
Interest on the 7 1/4% Subordinated Notes due August 1, 2007 (the
"Subordinated Notes") is payable by Comerica Incorporated ("Comerica")
semi-annually on February 1 and August 1 of each year, beginning February 1,
1996. The Subordinated Notes will be available for purchase in denominations of
$1,000 or any integral multiple thereof. The Subordinated Notes are not
redeemable prior to maturity and no sinking fund is provided for the
Subordinated Notes. See "Description of Subordinated Notes."
The Subordinated Notes are unsecured and subordinated to all Senior
Indebtedness and, in certain circumstances, to Other Financial Obligations (as
defined) of Comerica as described in the accompanying Prospectus under
"Description of the Notes -- Subordination of Notes." Payment of the principal
of the Subordinated Notes may be accelerated only in the case of certain events
involving the bankruptcy, insolvency or reorganization of Comerica. There is no
right of acceleration in the case of a default in the performance of any
covenant of Comerica, including the payment of principal or interest. See
"Description of the Notes -- Events of Default and Limited Rights of
Acceleration" in the Prospectus.
The Subordinated Notes will be represented by one or more Global Notes
registered in the name of a nominee of The Depository Trust Company, as
depositary (the "Depository"). Beneficial interests in Global Notes will be
shown on, and transfers thereof will be effected only through, records
maintained by the Depository and its participants. Except as described under
"Description of the Notes -- Global Securities" in the Prospectus, Subordinated
Notes in definitive form will not be issued and owners of beneficial interests
in the Global Notes will not be considered holders of the Subordinated Notes.
Settlement will be made in immediately available funds. The Subordinated Notes
will trade in the Depository's Same-Day Funds Settlement System until maturity,
and secondary market trading activity in the Subordinated Notes will therefore
settle in immediately available funds. All payments of principal and interest
will be made by Comerica in immediately available funds. See "Description of the
Subordinated Notes -- Same-Day Settlement and Payment."
---------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE SUBORDINATED NOTES OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR
OTHER OBLIGATIONS OF ANY BANK OR NONBANK SUBSIDIARY OF COMERICA AND
ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENTAL ENTITY.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
Price to Underwriting Proceeds to
Public(1) Discount(2) Comerica(1)(3)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Note.................................... 99.721% 0.675% 99.046%
- -----------------------------------------------------------------------------------------------------------
Total....................................... $149,581,500 $1,012,500 $148,569,000
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Plus accrued interest, if any, from August 7, 1995 to the date of delivery.
(2) Comerica has agreed to indemnify the several Underwriters against certain
liabilities under the Securities Act of 1933, as amended. See
"Underwriting."
(3) Before deducting expenses payable by Comerica estimated at $216,466.
---------------------------
The Subordinated Notes offered by this Prospectus Supplement and the
related Prospectus are offered by the Underwriters subject to prior sale, to
withdrawal, cancellation or modification of the offer without notice, to
delivery to, and acceptance by, the Underwriters and to certain further
considerations. It is expected that delivery of the Subordinated Notes will be
made at the offices of Lehman Brothers Inc., New York, New York on or about
August 7, 1995.
---------------------------
LEHMAN BROTHERS
CS FIRST BOSTON
MORGAN STANLEY & CO.,
INCORPORATED
SALOMON BROTHERS INC
August 2, 1995
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SUBORDINATED
NOTES AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
-------------------------
USE OF PROCEEDS
Approximately $135 million of the net proceeds from the sale of the
Subordinated Notes offered by this Prospectus Supplement is presently expected
to be used to purchase shares of Comerica Common Stock to be exchanged for
shares of Metrobank Common Stock in connection with Comerica's pending
acquisition of Metrobank. (See "COMERICA INCORPORATED -- General" in the
accompanying Prospectus). The remainder of the proceeds will be applied to
Comerica's general funds to be utilized for such corporate purposes as may be
determined by management, which may include investments in, and extensions of
credit to, existing and future subsidiaries, the funding of future acquisitions
of banking and nonbanking institutions and other general corporate purposes.
S-2
<PAGE> 3
SELECTED CONSOLIDATED FINANCIAL DATA OF COMERICA INCORPORATED
The following table sets forth certain selected consolidated financial data
of Comerica and is based on the consolidated financial statements of Comerica,
including the respective notes thereto, which, in the case of the three most
recent fiscal years, are incorporated by reference in this Prospectus Supplement
and should be read in conjunction therewith.
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED
-------------------- FOR THE YEAR ENDED DECEMBER 31,
JUNE 30, JUNE 30, ---------------------------------------------------
1995 1994 1994 1993 1992 1991 1990
-------- -------- ------- ------- ------- ------- -------
(UNAUDITED) (DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
CONDENSED STATEMENT OF INCOME:
Net interest income............................. $ 636 $ 605 $ 1,230 $ 1,134 $ 1,121 $ 1,050 $ 927
Provision for loan losses....................... 28 30 56 69 111 105 100
Non-interest income............................. 241 227 467 462 411 385 348
Non-interest expenses........................... 544 516 1,059 1,038 1,092 945 848
Provision for income taxes...................... 103 96 195 148 89 105 79
Net income...................................... $ 202 $ 190 $ 387 $ 341 $ 240 $ 280 $ 248
CONSOLIDATED AVERAGE BALANCES:
Total loans..................................... $22,938 $19,498 $20,211 $18,307 $17,447 $16,622 $15,477
Total assets.................................... 33,628 30,868 31,451 27,236 26,510 26,365 24,332
Total deposits.................................. 21,493 21,222 21,325 20,721 20,913 20,785 19,381
Medium- and long-term debt...................... 4,197 1,847 2,708 1,087 414 323 348
Common stockholders' equity..................... 2,477 2,256 2,313 2,136 1,957 1,741 1,485
Total stockholders' equity...................... 2,477 2,256 2,313 2,136 1,995 1,779 1,523
PERFORMANCE RATIOS:(1)
Return on average assets........................ 1.20% 1.23% 1.23% 1.25% 0.91% 1.06% 1.02%
Return on average common stockholders' equity... 16.28 16.85 16.74 15.94 12.10 15.90 16.47
Net interest margin -- taxable equivalent....... 4.16 4.34 4.32 4.65 4.73 4.49 4.36
Non-interest expenses as % of average total
assets........................................ 3.24 3.35 3.37 3.81 4.12 3.58 3.49
Non-performing assets as % of loans and other
real estate owned(2).......................... .82 1.27 .92 1.09 1.50 1.48 1.54
Non-performing loans as % of loans(2)........... .65 .99 .74 .83 1.23 1.22 1.19
Allowance for loan losses as % of loans(2)...... 1.41 1.59 1.47 1.56 1.69 1.62 1.60
Allowance for loan losses as % of non-performing
assets(2)..................................... 171 124 160 143 113 109 104
Net charge-offs as % of average loans........... .17 .24 .24 .43 .57 .58 1.18
Total stockholders' equity as % of assets(2).... 7.01 7.42 7.15 7.20 7.61 6.68 6.05
Common stockholders' equity as % of assets(2)... 7.01 7.42 7.15 7.20 7.47 6.55 5.90
REGULATORY CAPITAL RATIOS:(2)
Tier I risk-based capital....................... 7.61% 8.41% 8.13% 8.21% 8.83% 8.13% 7.23%
Total risk-based capital........................ 10.85 11.58 11.68 11.58 11.82 10.69 9.99
Leverage ratio.................................. 6.59 6.86 6.93 7.04 7.52 6.61 5.75
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES:
Excluding interest on deposits.................. 2.04x 2.96x 2.61x 3.95x 3.31x 2.81x 2.30x
Including interest on deposits.................. 1.47 1.72 1.64 1.70 1.39 1.31 1.24
</TABLE>
- -------------------------
(1) Ratios are annualized where appropriate.
(2) At period end.
S-3
<PAGE> 4
CAPITALIZATION
The following table sets forth the consolidated capitalization of Comerica
and its subsidiaries at June 30, 1995 and as adjusted to give effect to the
issuance of the Subordinated Notes offered hereby:
<TABLE>
<CAPTION>
JUNE 30, 1995
-------------------------
ACTUAL AS ADJUSTED
---------- -----------
(IN THOUSANDS)
<S> <C> <C>
Medium- and Long-term Debt
Parent Company
9.75% subordinated notes due 1999.................................. $ 74,647 $ 74,647
10.125% subordinated debentures due 1998........................... 74,761 74,761
Line of credit due 1995............................................ 60,000 60,000
Notes offered hereby............................................... -- 150,000
---------- -----------
Total parent company.......................................... 209,408 359,408
Subsidiaries
Subordinated notes:
8.375% subordinated notes due 2024................................. 147,748 147,748
7.25% subordinated notes due 2002.................................. 148,856 148,856
6.875% subordinated notes due 2008................................. 99,028 99,028
7.125% subordinated notes due 2013................................. 147,946 147,946
FDIC subordinated note due 1995.................................... 4,500 4,500
---------- -----------
Total subordinated notes...................................... 548,078 548,078
Medium-term notes:
Floating rate based on Treasury bill indices....................... 2,399,478 2,399,478
Floating rate based on Prime indices............................... 100,000 100,000
Fixed rate notes with interest rates ranging from 5.95% to 7.5%.... 1,148,090 1,148,090
---------- -----------
Total medium-term notes....................................... 3,647,568 3,647,568
Notes payable bearing interest at rates ranging from 6.29% to
11.15% and maturing on dates ranging from 1995 through 1966..... 6,227 6,227
---------- -----------
Total subsidiaries............................................ 4,201,873 4,201,873
---------- -----------
Total medium- and long-term debt........................... 4,411,281 4,561,281
---------- -----------
Shareholders' Equity
Common stock -- $5 par value -- 250,000,000 shares authorized,
115,212,031 shares issued....................................... 576,060 576,060
Capital surplus.................................................... 417,274 417,274
Unrealized gains and losses on investment securities available for
sale............................................................ (2,268) (2,268)
Retained earnings.................................................. 1,510,008 1,510,008
Less cost of common stock in treasury -- 627,316 shares.............. (16,337) (16,337)
---------- -----------
Total shareholders' equity.................................... 2,484,737 2,484,737
---------- -----------
Total capitalization....................................... $6,896,018 $ 7,046,018
========== ===========
</TABLE>
DESCRIPTION OF SUBORDINATED NOTES
The following is a brief description of the particular terms of the
Subordinated Notes. This description does not purport to be complete, should be
read in conjunction with the statements under "Description of the Notes" in the
Prospectus and is subject to and qualified in its entirety by reference to the
Indenture, dated as of August 7, 1995, between Comerica and The Chase Manhattan
Bank, N.A., as Trustee (the "Trustee"), pursuant to which the Subordinated Notes
are to be issued. A copy of the form of Indenture has been filed as an exhibit
to the Registration Statement of which the Prospectus is a part. Capitalized
terms not defined herein shall have the meanings assigned to such terms in the
Prospectus and the Indenture.
S-4
<PAGE> 5
General. The Subordinated Notes will mature on August 1, 2007, bear
interest at the rate of 7.25% per annum and be limited to $150 million aggregate
principal amount. Interest on the Subordinated Notes will be payable
semi-annually on February 1 and August 1 of each year commencing February 1,
1996 to the Persons in whose names the Subordinated Notes are registered at the
close of business on the preceding January 15 or July 15 as the case may be.
Principal of and interest on the Subordinated Notes will be payable, and
the transfer of Subordinated Notes will be registrable, through The Depository
Trust Company, as depositary (the "Depository"), as described under "Description
of the Notes-Global Securities" in the Prospectus. The Subordinated Notes will
be sold in denominations of $1,000 and integral multiples thereof.
The Subordinated Notes will not be redeemable by Comerica, in whole or in
part, prior to their final stated maturity and do not provide for any sinking
fund.
The Subordinated Notes will be unsecured and subordinated obligations of
Comerica which will be subordinate in right of payment to all Senior
Indebtedness of Comerica and, in certain circumstances, to all Other Financial
Obligations of Comerica. See "Description of the Notes -- Subordination of
Notes" in the Prospectus. At June 30, 1995 Comerica had approximately $149
million of Senior Indebtedness outstanding and did not have any Other Financial
Obligations outstanding. The Indenture does not limit or prohibit the incurrence
of additional Senior Indebtedness or Other Financial Obligations.
Payment of the principal of the Subordinated Notes may be accelerated only
in the case of certain events involving the bankruptcy, insolvency or
reorganization of Comerica. There is no right of acceleration in the case of a
default in the performance of any covenant of Comerica, including the payment of
principal or interest on the Subordinated Notes. See "Description of the Notes
- -- Events of Default and Limited Rights of Acceleration" in the Prospectus.
Global Notes. The Subordinated Notes will be issued in the form of one or
more fully registered global notes (the "Global Notes") which will be deposited
with, or on behalf of, the Depository and registered in the name of the
Depository's nominee. Global Notes will not be transferable or exchangeable for
Subordinated Notes in certificated form except under the limited circumstances
described in the Prospectus under "Description of the Notes -- Global
Securities."
The Depository has advised Comerica as follows: it is a limited-purpose
trust company organized under the laws of the State of New York, a member of the
Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code, and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Securities Exchange Act of 1934, as amended.
The Depository was created to hold securities for its participating
organizations ("Participants") and to facilitate the clearance and settlement of
securities transactions between Participants in such securities through
electronic book-entry changes in accounts of Participants. Participants include
securities brokers and dealers (including the Underwriters), banks and trust
companies, clearing corporations and certain other organizations. Access to the
Depository's system is also available to others such as banks, brokers, dealers,
and trust companies that clear through or maintain a custodial relationship with
a Participant, either directly or indirectly ("Indirect Participants"). Persons
who are not Participants may beneficially own securities held by the Depository
only through Participants or Indirect Participants.
Same-Day Settlement and Payment. Settlement for the Subordinated Notes will
be made in immediately available funds. All payments of principal and interest
on the Subordinated Notes will be made by Comerica in immediately available
funds. The Subordinated Notes will trade in the Depository's Same-Day Funds
Settlement System until maturity, and therefore the Depository will require
secondary trading activity in the Subordinated Notes to be settled in
immediately available funds.
S-5
<PAGE> 6
UNDERWRITING
Subject to the terms set forth in the Underwriting Agreement (the
"Underwriting Agreement") Comerica has agreed to sell to each of the
Underwriters named below, and each of the Underwriters, for whom Lehman Brothers
Inc. is acting as the representative, has severally agreed to purchase, the
principal amount of the Subordinated Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT OF
UNDERWRITER SUBORDINATED NOTES
- --------------------------------------------------------------------------- -------------------
<S> <C>
Lehman Brothers Inc........................................................ $ 37,500,000
CS First Boston Corporation................................................ 37,500,000
Morgan Stanley & Co., Incorporated......................................... 37,500,000
Salomon Brothers Inc....................................................... 37,500,000
------------
Total.................................................................... $150,000,000
============
</TABLE>
In the Underwriting Agreement, the Underwriters have agreed, subject to
certain terms and conditions, to purchase all of the Subordinated Notes if any
of the Subordinated Notes are purchased.
Comerica has been advised that the Underwriters propose to offer the
Subordinated Notes to the public initially at the public offering price set
forth on the cover page of this Prospectus Supplement and to certain dealers at
such public offering price less a concession not in excess of .400% of the
principal amount of the Subordinated Notes. The Underwriters may allow, and such
dealers may reallow, a concession not in excess of .250% of the principal amount
of the Subordinated Notes to certain other brokers and dealers. After the
initial public offering, the public offering price and other selling terms may
be changed by the Underwriters.
The Subordinated Notes are a new issue of securities with no established
trading market. Comerica has been advised by the Underwriters that they intend
to make a market in the Subordinated Notes but they are not obligated to do so
and may discontinue market making at any time without notice. No assurance can
be give as to the liquidity of the trading market for the Subordinated Notes or
as to the prices at which the Subordinated Notes may trade in such market.
Comerica has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended
or to contribute to payments which the Underwriters may be required to make.
The Underwriters and their affiliates in the ordinary course of business
engage in transactions with and perform services for Comerica and its affiliates
which may include, among other things, investment banking transactions and
services.
S-6
<PAGE> 7
PROSPECTUS
$200,000,000
COMERICA INCORPORATED
SUBORDINATED DEBT SECURITIES
Comerica Incorporated ("Comerica"), directly or through agents designated
from time to time, or through dealers or underwriters also to be designated, may
offer from time to time in one or more series up to $200,000,000 aggregate
principal amount of its unsecured subordinated debt securities (the "Notes"), on
terms to be determined at the time of sale. The specific designation, aggregate
principal amount, maturity, rate and time of payment of interest, if any,
purchase price, any terms for redemption, any mandatory or optional sinking fund
or analogous provisions, whether the Notes are issuable in certificated or
uncertificated form, whether the Notes initially will be represented by a single
global debt security and the agents, dealers or underwriters, if any, in
connection with the sale of the Notes in respect of which this Prospectus is
being delivered will be set forth in an accompanying Prospectus Supplement (the
"Prospectus Supplement"). Comerica reserves the sole right to accept and,
together with its agents from time to time, to reject in whole or in part any
proposed purchase of Notes to be made directly or through agents.
The Notes will be subordinated to all present and future Senior
Indebtedness (as defined) of Comerica and, under certain circumstances, to Other
Financial Obligations (as defined) of Comerica. Payment of principal of the
Notes may be accelerated only in the case of certain events of bankruptcy or
insolvency of Comerica. There is no right of acceleration in the case of a
default in the payment of the principal of, or any premium or interest on, the
Notes or the performance of any agreement or covenant of Comerica. See
"Description of the Notes".
THE NOTES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF ANY BANK
OR NONBANK SUBSIDIARY OF COMERICA AND ARE NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, OR OTHER GOVERNMENT ENTITY.
---------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
---------------------------
If an agent of Comerica or a dealer or underwriter is involved in the sale
of the Notes in respect of which this Prospectus is being delivered, the agent's
commission, dealer's purchase price, or underwriter's discount will be set forth
in, or may be calculated from, the Prospectus Supplement and the net proceeds to
Comerica from such sale will be the purchase price of such Notes less such
commission in the case of an agent, the purchase price of such Notes in the case
of a dealer or the public offering price less such discount in the case of an
underwriter, and less, in each case, the other attributable issuance expenses.
The aggregate proceeds to Comerica from all the Notes will be the purchase price
of the Notes sold less the aggregate of agents' commissions and underwriters'
discounts and other expenses of issuance and distribution. See "Plan of
Distribution" for possible indemnification arrangements for the agents, dealers
and underwriters.
The Notes will not be listed on any securities exchange, and there can be
no assurance that the Notes will be sold or that there will be a secondary
market for the Notes or if such secondary market develops, the liquidity of the
Notes in such secondary market.
This Prospectus may not be used to consummate sales of the Notes unless
accompanied by a Prospectus Supplement.
---------------------------
The date of this Prospectus is July 25, 1995
<PAGE> 8
AVAILABLE INFORMATION
Comerica is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith Comerica files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's Regional Offices
at 7 World Trade Center, Suite 1300, New York, New York 10048 and Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of
such material also can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. In addition, material filed by Comerica can be inspected at the offices
of the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005.
Comerica has filed with the Commission a Registration Statement on Form S-3
(together with any amendments thereto, the "Registration Statement") under the
Securities Act of 1933, as amended (the "Securities Act"). This Prospectus does
not contain all the information set forth in the Registration Statement and the
exhibits thereto, certain parts of which are omitted in accordance with the
rules and regulations of the Commission. For further information, reference is
hereby made to said Registration Statement
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by Comerica pursuant to
the Exchange Act (File No. 1-10706) are incorporated by reference in this
Prospectus:
1. Comerica's Annual Report on Form 10-K for the year ended December
31, 1994.
2. Comerica's Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 1995.
All documents and reports filed by Comerica pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and
prior to the date of the termination of the offering of the securities offered
hereby shall be deemed to be incorporated by reference in this Prospectus and to
be a part hereof from the dates of filing of such documents or reports. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Comerica will provide without charge to each person, including any
beneficial owner of any Note, to whom this Prospectus is delivered, upon the
oral or written request of any such person, a copy of any or all of the
foregoing documents incorporated herein by reference (other than exhibits to
such documents unless such exhibits are explicitly incorporated by reference
into such documents). Requests should be directed to Judith C. Dart, Executive
Vice President, General Counsel and Secretary, Comerica Incorporated, Comerica
Tower at Detroit Center, 500 Woodward Avenue, Detroit, Michigan 48226, Telephone
(313) 222-7937.
COMERICA INCORPORATED
General. Comerica is a registered bank holding company incorporated under
the laws of the State of Delaware, headquartered in Detroit, Michigan and was
formed in 1973 to acquire the outstanding common stock of Comerica Bank
(formerly Comerica Bank-Detroit), a Michigan banking corporation ("Comerica
Bank"). On June 18, 1992, Manufacturers National Corporation, a registered bank
holding company incorporated under the laws of the State of Delaware
("Manufacturers"), was merged with and into Comerica. Comerica was the surviving
corporation. The merger was accounted for as a pooling-of-interests. As of March
31, 1995, Comerica owned directly or indirectly all the outstanding common stock
(except for
2
<PAGE> 9
directors' qualifying shares, where applicable) of 9 banking and 35 active
nonbanking subsidiaries. At March 31, 1995, Comerica had total assets of
approximately $34.1 billion, total deposits of approximately $21.9 billion,
total loans (net of unearned income) of approximately $23.1 billion, and
shareholders' equity of approximately $2.5 billion. At March 31, 1995, Comerica
was the second largest bank holding company headquartered in Michigan in terms
of total assets.
Comerica's business strategy focuses on five core businesses in four
geographic markets. Those businesses are corporate banking, consumer banking,
private banking, institutional trust and investment management, and
international finance and trade services. Corporate banking incorporates highly
specialized units servicing a full range of company sizes with both credit and
non-credit products. Consumer banking provides deposit, credit and fee-based
products to individuals needing financial services but whose income or wealth do
not make them prospects for private banking services. Private banking is
oriented to servicing the financial needs of the affluent market as defined by
individual net income or worth. Institutional trust and investment management
activities involve providing companies, municipalities and other entities a wide
spectrum of investment management products and trust products such as master
trust, master custody, and corporate trust services, as well as administering
and serving as trustee for employee benefit plans. International finance and
trade services offer importers and exporters trade financing, letters of credit,
foreign exchange and international customhouse brokerage and freight forwarding
products. The core businesses are tailored to each of Comerica's four primary
geographic markets: the Midwest (currently Michigan and Illinois), Texas,
California, and Florida. The Midwest is the only market in which all five core
businesses are currently pursued. In California and Texas, the primary focus is
on corporate banking and private banking activities. In Florida, the primary
focus is on private banking.
On September 14, 1992, Comerica Bank, Comerica's principal banking
subsidiary, and Manufacturers Bank, N.A. (the principal banking subsidiary of
Manufacturers prior to its merger into Comerica on June 18, 1992) were merged,
with Comerica Bank being the surviving institution. Such merger was accounted
for using the pooling-of-interests method. At March 31, 1995, Comerica Bank had
approximately 280 branch offices in Michigan and total assets of approximately
$27.5 billion. At March 31, 1995, Comerica Bank was the second largest
commercial bank in Michigan in terms of deposits.
In Illinois, Comerica owns Comerica Bank-Illinois. At March 31, 1995,
Comerica Bank-Illinois had 28 offices in Illinois and total assets of
approximately $1.5 billion.
In Texas, Comerica owns Comerica Bank-Texas, which focuses on middle market
banking, small business banking, private banking and trust services in the
Houston and Dallas/Fort Worth, Texas area. At March 31, 1995, Comerica
Bank-Texas had total assets of approximately $3.5 billion and 58 offices. On
June 28, 1995, Comerica, QuestStar Bank, N.A., a national bank ("QuestStar"),
Comerica Texas Incorporated, a Texas corporation and parent of Comerica
Bank-Texas and wholly owned subsidiary of Comerica ("Comerica-Texas") and
Comerica Interim Incorporated, a Texas corporation and wholly owned subsidiary
of Comerica-Texas ("Interim") entered into an Agreement and Plan of
Reorganization and Merger providing for, among other things, the merger of
QuestStar into Interim with Interim being the surviving corporation. Subsequent
to the merger of QuestStar into Interim, Interim may, at Comerica's election, be
merged into Comerica Bank-Texas. The transaction is subject to regulatory and
QuestStar shareholder approval and is expected to be completed sometime in the
fourth quarter of 1995. Shareholders of QuestStar would receive cash in the
amount of approximately $25 million, subject to certain adjustments. At May 31,
1995, QuestStar had assets of approximately $196 million.
In California, Comerica owns Comerica Bank-California, which focuses on
middle market banking, small business and private banking, as well as trust
services, in the San Jose and Los Angeles areas, and University Bank & Trust
Company which provides similar services in the Palo Alto area. At March 31,
1995, Comerica Bank-California and University Bank & Trust Company
("University") had total assets of approximately $2.5 billion. They had 32
offices of which eleven are located in the San Francisco Bay Area. Comerica
Bank-California and University provide a wide array of services focused in
middle market banking, small business banking, high technology, commercial real
estate lending and mortgage banker financing. Comerica
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<PAGE> 10
Bank-California and University also provide cash management and trade finance
services to corporate customers. They also target affluent and professional
clients and provide customized solutions for their private banking needs.
Specialized banking services include lines of credit, equipment loans,
residential mortgage loans, equity lines of credit and consumer loans. Comerica
Bank-California and University offer fully managed trust accounts for
individuals and companies, and administration, record keeping, and investment
services for 401(k) plans and pension and profit sharing plans. On May 2, 1995,
Comerica, Metrobank, a California bank ("Metrobank") and Comerica Holdings,
Incorporated, a California corporation and wholly owned subsidiary of Comerica
("Holdings") entered into an Agreement and Plan of Reorganization and Merger
providing for, among other things, the merger of Metrobank into Holdings with
Metrobank being the surviving corporation. Subsequent to the merger of Metrobank
into Holdings, Metrobank may, at Comerica's election, be merged into Comerica
Bank-California. The transaction is subject to regulatory and Metrobank
shareholder approval and is expected to occur sometime in the first quarter of
1996 and will be accounted for as a purchase. Shareholders of Metrobank would
receive Comerica Common Stock valued at approximately $120 million. At March 31,
1995, Metrobank had assets of approximately $1.3 billion.
Comerica serves trust and banking customers in Florida through Comerica
Bank & Trust, F.S.B., a federally chartered savings bank, which operates six
offices and had approximately $157 million in assets at March 31, 1995.
Competitors of Comerica's banking subsidiaries include commercial banks,
savings and loan associations, consumer and commercial finance companies,
leasing companies, credit unions and other financial services companies. Based
on the recent passage of the Interstate Banking and Branching Efficiency Act of
1994 (the "Interstate Act") and on legislation passed during 1985 that allows
Michigan-based banks to acquire or be acquired by banks in states with similar
laws in effect, Comerica believes that the level of competition will increase in
the future.
Comerica's principal executive offices are located at Comerica Tower at
Detroit Center, 500 Woodward Avenue, Suite 3100, Detroit, Michigan 48226, and
its telephone number is (313) 222-4000.
Regulatory Considerations. Comerica is a legal entity separate and distinct
from its banking and other subsidiaries. Most of Comerica's revenues result from
dividends paid to it by its bank subsidiaries. There are statutory and
regulatory requirements applicable to the payment of dividends and other
transfers of funds to Comerica by its subsidiary banks as well as by Comerica to
its shareholders.
Each state bank subsidiary that is a member of the Federal Reserve System
and each national banking association subsidiary is required by federal law to
obtain the prior approval of the Federal Reserve Board or the Comptroller of the
Currency (the "Comptroller"), as the case may be, for the declaration and
payment of dividends if the total of all dividends declared by the board of
directors of such bank in any year will exceed the total of (i) such bank's net
profits (as defined and interpreted by regulation) for that year plus (ii) the
retained net profits (as defined and interpreted by regulation) for the
preceding two years, less any required transfers to surplus. In addition, these
banks may only pay dividends to the extent that retained net profits (including
the portion transferred to surplus) exceed bad debts (as defined by regulation).
Under the foregoing dividend restrictions, in 1995 Comerica's subsidiary
banks, without obtaining governmental approvals, can declare aggregate dividends
of approximately $153 million from retained net profits of the preceding two
years, plus an amount approximately equal to the net profits (as measured under
current regulations), if any, earned for the period from January 1, 1995 through
the date of declaration. During 1994, Comerica's subsidiary banks paid $293
million in dividends.
The banking authorities in the states where Comerica owns state-chartered
banks also regulate the payment of dividends by banks organized in such states.
Generally, (i) California state banks such as Comerica Bank-California and
University may not declare or pay a dividend, without the prior written approval
of the California Superintendent of Banks, if the total of all dividends
declared by such bank in any calendar year would exceed the total of its net
profits, as defined, for that year combined with its retained net profits, as
defined, for the preceding two years, (ii) Michigan state banks such as Comerica
Bank may not pay a dividend if the amount of such dividend would exceed net
profits then on hand or if the surplus remaining
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<PAGE> 11
after payment thereof would be less than 20 percent of the bank's capital, and
(iii) payment of dividends by Texas state banks such as Comerica Bank-Texas are
restricted by minimum capital requirements. Generally, an Illinois state
chartered bank, such as Comerica Bank-Illinois, may pay dividends only out of
net profits. If an Illinois bank's surplus does not equal its capital, it may
declare a dividend only after at least one-tenth of its net profits since the
declaration of the last dividend has been added to its surplus. An Illinois bank
may not pay dividends in an amount greater than net profits then on hand, less
deductions for losses and bad debts, as defined by statute.
The payment of dividends by Comerica's bank subsidiaries is also affected
by various regulatory requirements and policies, such as the requirement to
maintain capital at or above regulatory guidelines. In addition, if, in the
opinion of the applicable regulatory authority, a bank under its jurisdiction is
engaged in or is about to engage in an unsafe or unsound practice (which,
depending on the financial condition of the bank, could include the payment of
dividends), such authority may require, after notice and hearing, that such bank
cease and desist from such practice. The Federal Reserve Board and the
Comptroller have each indicated that paying dividends that deplete a bank's
capital base to an inadequate level would be an unsafe and unsound banking
practice. The Federal Reserve Board, the Comptroller and the Federal Deposit
Insurance Corporation ("FDIC") have issued policy statements which provide that
bank holding companies and insured banks should generally only pay dividends out
of current operating earnings.
There are also statutory limits on the other transfers of funds to Comerica
and its nonbank subsidiaries by its bank subsidiaries, whether in the form of
loans or other extensions of credit, investments in securities or asset
purchases. Such transfers by a subsidiary bank to Comerica or any such
nonbanking subsidiary are limited in amount to 10% of such bank's capital and
surplus, or 20% in the aggregate to Comerica and all such nonbanking
subsidiaries together. In addition, any such loans or extensions of credit are
required to be collateralized in specified amounts.
Proposals to change the laws and regulations governing banks, bank holding
companies, and other financial institutions are frequently raised in Congress,
in the state legislatures and before the various bank regulatory agencies.
Management is unable to determine the likelihood of any changes and the impact
such changes might have on Comerica.
Under Federal Reserve Board policy, Comerica is expected to act as a source
of financial strength to each of its subsidiary banks and, if necessary, to
commit resources to support each of such subsidiaries. This support may be
required at times when, absent such Federal Reserve Board policy, Comerica would
not otherwise be required to provide it.
Future Acquisitions. Comerica continues to review and evaluate potential
acquisitions in order to expand its core businesses in defined markets. Comerica
anticipates that from time to time in the future it will acquire companies which
complement and effectuate Comerica's business objectives in both
federally-assisted and negotiated transactions.
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<PAGE> 12
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the unaudited consolidated ratios of
earnings to fixed charges for Comerica for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH
31, YEAR ENDED DECEMBER 31,
------------ ------------------------------------
1995 1994 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Consolidated ratio of earnings to fixed charges:*
Excluding interest on deposits.................. 2.09x 3.11x 2.61x 3.95x 3.31x 2.81x 2.30x
Including interest on deposits.................. 1.49 1.74 1.64 1.70 1.39 1.31 1.24
</TABLE>
- -------------------------
* The ratio of earnings to fixed charges is computed by dividing income before
income taxes and fixed charges by fixed charges. Fixed charges are defined as
interest expense (including or excluding interest on deposits, as the case may
be) and the portion of net rental expense estimated to be representative of
the interest factor.
USE OF PROCEEDS
Except as otherwise specified in a Prospectus Supplement, the net proceeds
from the sale of the securities offered by this Prospectus will be applied to
Comerica's general funds to be utilized for such corporate purposes as may be
determined by management, which may include investments in, and extensions of
credit to, existing and future subsidiaries, the funding of acquisitions of
banking and nonbanking institutions, (including the repurchase of issued and
outstanding shares of common stock of Comerica which may be used to fund part or
all of the acquisition consideration) and other general corporate purposes.
Except as otherwise indicated in a Prospectus Supplement, specific
allocations of the proceeds to such purposes will not have been made at the date
of the applicable Prospectus Supplement. The precise amount and timing of
investments in, and extensions of credit to, subsidiaries will depend upon their
funding requirements and the availability of other funds to Comerica and its
subsidiaries. Based upon the anticipated future financing requirements of
Comerica and its subsidiaries, Comerica expects that it will, from time to time,
engage in additional financings of a character and in an amount to be
determined.
DESCRIPTION OF THE NOTES
The Notes are to be issued under an indenture to be dated August 7, 1995
(the "Indenture") between Comerica and The Chase Manhattan Bank, N.A., as
Trustee (the "Trustee"). A copy of the form of the Indenture is filed as an
exhibit to the Registration Statement of which this Prospectus is a part. See
"Available Information." The following summaries of certain provisions of the
Indenture do not purport to be complete and are subject to, and are qualified in
their entirety by reference to, all of the provisions of the Indenture,
including the definition therein of certain capitalized terms used herein.
Wherever particular sections or defined terms of the Indenture are referred to,
it is intended that such sections or defined terms shall be incorporated herein
by reference. The following sets forth certain general terms and provisions of
the Notes. Further terms of each series of Notes will be set forth in the
Prospectus Supplement relating thereto.
General. The Indenture does not limit the aggregate principal amount of
Notes which may be issued thereunder and provides that Notes may be issued from
time to time in series. The Notes will be unsecured subordinated obligations of
Comerica. The Indenture does not limit Comerica's ability to incur other
indebtedness or contain provisions which would protect the Holders of, or owners
of beneficial interests in, the Notes against a sudden decline in credit quality
resulting from takeovers, recapitalizations or other similar restructurings.
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<PAGE> 13
The Prospectus Supplement will describe the following terms of each series
of Notes in respect of which this Prospectus is being delivered: (1) the title
of the Notes; (2) any limit on the aggregate principal amount of the Notes; (3)
the date or dates on which the Notes will mature; (4) the rate or rates per
annum at which the Notes will bear interest, if any, or the manner in which such
rates will be determined and the date from which such interest, if any, will
accrue; (5) the Interest Payment Dates on which such interest (if any) on the
Notes will be payable and the Regular Record Dates for such Interest Payment
Dates; (6) the currency or currency unit, if other than United States dollars,
of payment of principal of, and premium and interest, if any, on, the Notes; (7)
if the Notes are to be issued in the form of one or more global securities (a
"Global Security"), the identity of the depositary for such Global Security or
Securities; (8) any mandatory or optional sinking fund or analogous provisions;
(9) any additions to, or modifications or deletions of, any Events of Default or
covenants and the remedies with respect thereto provided for with respect to the
Notes; (10) any redemption terms; (11) any provisions permitting defeasance of
Comerica's obligations with respect to the Notes or the Indenture; (12) if other
than the principal amount thereof, the portion of the principal amount of the
Notes payable upon acceleration of the maturity thereof; and (13) any other
specific terms of the Notes.
Unless otherwise specified in the Prospectus Supplement, principal of, and
premium and interest, if any, on, the Notes will be payable at the office or
agency of Comerica maintained for that purpose in the Borough of Manhattan, the
City of New York, and the Notes may be surrendered for transfer or exchange at
said office or agency; provided that payment of interest, if any, may be made at
the option of Comerica by check mailed to the address of the person entitled
thereto as it appears in the register for the Notes on the Regular Record Date
for such interest. (Sections 3.1 and 10.2) The office of the Trustee in the
Borough of Manhattan, the City of New York, will initially be designated as such
office or agency.
After the execution and delivery of the Indenture, the Company may deliver
Notes to the Trustee for authentication. Accompanying the delivery of the Notes
to the Trustee will be a Company Order for the authentication and delivery of
the Notes. In accordance with the Company Order, the Trustee will authenticate
and deliver the Notes. Each Note will be dated the date of its authentication.
(Section 3.3)
The Notes will be issued only in fully registered form without coupons and,
unless otherwise indicated in the Prospectus Supplement, if denominated in
United States dollars, will be issued in denominations of $1,000 or any integral
multiple thereof. No service charge will be made for any transfer or exchange of
the Notes, but Comerica may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith. Comerica shall not
be required (i) to issue, register the transfer of or exchange any Notes of any
series during a period beginning at the opening of business 15 days before the
date of the mailing of a notice of redemption of Notes of that series selected
for redemption and ending at the close of business on the date of such mailing
or (ii) to register the transfer of or exchange any Note so selected for
redemption in whole or in part, except the unredeemed portion of Notes being
redeemed in part. (Sections 3.2 and 3.5)
All moneys paid by Comerica to the Trustee or any Paying Agent for the
payment of principal of and premium and interest on any Notes which remain
unclaimed for two years after such principal, premium or interest shall have
become due and payable may be repaid to Comerica and thereafter the Holder of
such Notes shall look only to Comerica for payment thereof. (Section 10.3)
If any Notes are payable in a currency or currency unit other than United
States dollars, the special federal income tax and other considerations
applicable to such Notes will be described in the Prospectus Supplement relating
thereto.
The Notes may be issued as Original Issue Discount Securities (bearing no
interest or bearing interest at a rate which at the time of issue is below
market rates) to be sold at a substantial discount below their principal amount.
If any Notes are issued as Original Issue Discount Securities, the special
federal income tax and other considerations applicable to such Notes will be
described in the Prospectus Supplement relating thereto.
Global Securities. The Notes may be issued in whole or in part in the form
of one or more Global Securities that will be deposited with, or on behalf of, a
depositary (the "Depository") identified in the Prospectus Supplement relating
to such Notes. Unless and until it is exchangeable in whole or in part for
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<PAGE> 14
Notes in definitive form, a Global Security may not be transferred except as a
whole by the Depository for such Global Security to a nominee of such Depository
or by a nominee of such Depository to such Depository or another nominee of such
Depository or by such Depository or any such nominee to a successor of such
Depository or a nominee of such successor. (Section 2.4)
The terms of the depositary arrangement, if any, with respect to a series
of Notes will be described in the Prospectus Supplement relating to such series.
Comerica anticipates that the following provisions will apply to all depositary
arrangements.
Ownership of beneficial interests in a Global Security will be limited to
persons that have accounts with the Depository for such Global Security or its
nominee ("Participants") or persons that may hold interests through
Participants. Such accounts shall be designated by the underwriters or agents
with respect to the Notes underwritten or solicited by them. Comerica expects
that upon the issuance of a Global Security, the Depository for such Global
Security will credit, on its book-entry registration and transfer system, the
Participants' accounts with the respective principal amounts of the Notes
represented by such Global Security. Ownership of beneficial interests in such
Global Security will be shown on, and the transfer of such ownership interests
will be effected only through, records maintained by the Depository (with
respect to interests of Participants) and on the records of Participants (with
respect to interests of persons held through Participants). The laws of some
states may require that certain purchasers of securities take physical delivery
of such securities in definitive form. Such limits and such laws may impair the
ability to own, transfer or pledge beneficial interests in a Global Security.
So long as the Depository for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depository or such nominee, as
the case may be, will be considered the sole owner or Holder of the Notes
represented by such Global Security for all purposes under the Indenture.
(Section 3.8) Except as provided below, owners of beneficial interests in a
Global Security will not be entitled to have the Notes represented by such
Global Security registered in their names, will not receive or be entitled to
receive physical delivery of the Notes in definitive form and will not be
considered the owners or Holders thereof under the Indenture. Accordingly, each
person owning a beneficial interest in such a Global Security must rely on the
procedures of the Depository and, if such person is not a Participant, on the
procedures of the Participant through which such person owns its interest, to
exercise any rights of a Holder under the Indenture. Comerica understands that
under existing industry practices, in the event that Comerica requests any
action of Holders or that an owner of a beneficial interest in such a Global
Security desires to take any action which a Holder is entitled to take under the
Indenture, the Depository would authorize the Participants holding the relevant
beneficial interests to take such action, and such Participants would authorize
beneficial owners owning through such Participants to take such action or would
otherwise act upon the instructions of beneficial owners owning through them.
Payment of principal of, and premium and interest, if any, on, Notes
registered in the name of a Depository or its nominee will be made to the
Depository or its nominee, as the case may be, as the registered owner of the
Global Security representing such Notes. None of Comerica, the Trustee, any
Paying Agent or any other agent of Comerica or the Trustee will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in the Global
Security for such Notes or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
Comerica expects that upon receipt of any payment of principal of, or
premium or interest on, a Global Security, the Depository will immediately
credit Participants' accounts with payments in amounts proportionate to their
respective beneficial interests in the principal amount of such Global Security
as shown on the records of the Depository. Payments by Participants to owners of
beneficial interests in such Global Security held through such Participants will
be the responsibility of such Participants, as is now the case with securities
held for the accounts of customers registered in "street name."
If the Depository for any Notes represented by a Global Security notifies
Comerica that it is unwilling or unable to continue as Depository or ceases to
be a clearing agency registered under the Exchange Act and a successor
Depository is not appointed by Comerica within ninety days after receiving such
notice or becoming aware that the Depository is no longer so registered,
Comerica will issue such Notes in definitive form upon
8
<PAGE> 15
registration of transfer of, or in exchange for, such Global Security. In
addition, Comerica may at any time and in its sole discretion determine not to
have the Notes represented by one or more Global Securities and, in such event,
will issue Notes in definitive form in exchange for all of the Global Securities
representing such Notes. (Section 3.5)
Subordination of Notes. The Notes are expressly subordinated in right of
payment, to the extent set forth in the Indenture, to all Senior Indebtedness
(as defined below). (Section 13.1) In certain events of insolvency, the Notes
will, to the extent set forth in the Indenture, also be effectively subordinated
in right of payment to the prior payment of all Other Financial Obligations (as
defined below). (Section 13.15)
If Comerica shall default in the payment of any principal of, premium, if
any, or interest, if any, on any Senior Indebtedness when the same becomes due
and payable, whether at maturity or at a date fixed for prepayment or by
declaration of acceleration or otherwise, or if any event of default with
respect to Senior Indebtedness permitting the holders thereof to accelerate the
maturity thereof shall have occurred and be continuing, or any judicial
proceeding shall be pending with respect to any such default in payment or event
of default then, unless and until such default or event of default shall have
been cured or waived or shall have ceased to exist or such judicial proceeding
shall be no longer pending, no direct or indirect payment (in cash, property,
securities, by set-off, or otherwise) shall be made for principal of or premium
or interest on the Notes, or in respect of any purchase or other acquisition of
any of the Notes. (Section 13.4) "Senior Indebtedness" of Comerica means the
principal of, premium, if any, and interest on all indebtedness for money
borrowed or purchased by Comerica, or borrowed by another and guaranteed by
Comerica (including any deferred obligation for the payment of the purchase
price of property or assets evidenced by a note or similar agreement), whether
now outstanding or subsequently created, assumed or incurred, and any
amendments, deferrals, renewals or extensions of any such Senior Indebtedness,
other than (i) any obligation as to which it is provided that such obligation is
not to be senior in right of payment to the Notes and (ii) the Notes. (Section
1.1) At March 31, 1995, Comerica had approximately $149 million of Senior
Indebtedness outstanding. The Indenture does not limit the amount of additional
Senior Indebtedness which Comerica may incur.
In the event of any insolvency, bankruptcy, receivership, reorganization,
readjustment of debt, assignment for the benefit of creditors, marshaling of
assets and liabilities, or similar proceedings relating to, or any liquidation,
dissolution, or winding-up of, Comerica, whether voluntary or involuntary, all
obligations of Comerica to holders of Senior Indebtedness shall be entitled to
be paid in full (or provision shall be made for such payment) before any payment
shall be made on account of the principal of or premium or interest on the
Notes. In the event of any such proceeding, if any payment by or distribution of
assets of Comerica of any kind or character, whether in cash, property, or
securities (other than securities of Comerica or any other corporation provided
for by a plan of reorganization or readjustment, the payment of which is
subordinate, at least to the extent provided in the subordination provisions
with respect to the Notes, to the payment of all Senior Indebtedness at the time
outstanding and to any securities issued in respect thereof under any such plan
of reorganization or readjustment), shall be received by the Trustee or the
Holders of the Notes before all Senior Indebtedness is paid in full, such
payment or distribution shall be held (in trust if received by the Holders of
the Notes) for the benefit of the holders of such Senior Indebtedness and shall
be paid over to the trustee in bankruptcy or other Person making payment or
distribution of the assets of Comerica for application to the payment of all
Senior Indebtedness remaining unpaid until all such Senior Indebtedness shall
have been paid in full after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness. (Section 13.2) If, upon
any such payment or distribution of assets to creditors, there remain, after
giving effect to such subordination provisions in favor of the holders of Senior
Indebtedness, any amounts of cash, property or securities available for payment
or distribution in respect of Notes (as defined in the Indenture, "Excess
Proceeds") and if, at such time, any person entitled to payment pursuant to the
terms of Other Financial Obligations has not received payment in full of all
amounts due or to become due on or in respect of such Other Financial
Obligations, then such Excess Proceeds shall first be applied to pay or provide
for the payment in full of such Other Financial Obligations before any payment
or distribution may be made in respect of the Notes. Unless otherwise specified
in the Prospectus Supplement relating to the particular series of Notes, the
term "Other Financial Obligations" includes all obligations of Comerica to make
payment
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<PAGE> 16
pursuant to the terms of financial instruments, such as: (i) securities
contracts and currency and foreign exchange contracts, and (ii) derivative
instruments, such as swap agreements (including interest rate and currency and
foreign exchange rate swap agreements), cap agreements, floor agreements, collar
agreements, interest rate agreements, foreign exchange agreements, options,
commodity futures contracts and commodity options contracts, other than (x)
obligations on account of Senior Indebtedness and (y) obligations on account of
indebtedness for money borrowed ranking pari passu with or subordinate to the
Notes. (Section 1.1)
By reason of such subordination, in the event of the bankruptcy or
insolvency of Comerica or similar event, whether before or after maturity of the
Notes, holders of Senior Indebtedness or of Other Financial Obligations may
receive more, ratably, and Holders of the Notes having a claim pursuant to the
Notes may receive less, ratably, than creditors of Comerica who do not hold
Senior Indebtedness, Other Financial Obligations or Notes.
In addition, in the event of the insolvency, bankruptcy, receivership,
conservatorship or reorganization of Comerica, the claims of the Holders of the
Notes would be subject as to enforcement to the broad equity power of a federal
bankruptcy court, and to the determination by that court of the nature of the
rights of the Holders.
Consolidation, Merger, Sale or Conveyance. Comerica may, without the
consent of any Holder of the Notes, merge or consolidate with any other
corporation or sell or convey all or substantially all of its assets to any
corporation, provided that the successor corporation (if other than Comerica)
shall be a corporation organized and existing under the laws of the United
States of America or a State thereof or the District of Columbia and such
corporation shall expressly assume Comerica's obligations under the Indenture
and on the Notes, and Comerica or such successor corporation, as the case may
be, shall not be in default in the performance of any covenant or condition of
the Indenture immediately after such merger, consolidation, sale or conveyance.
In addition, Comerica may, without the consent of any Holder of the Notes,
convey its assets substantially as an entirety to any Person in connection with
a transfer that is assisted by a federal bank regulatory authority and in such
case Comerica's obligations under the Indenture need not be assumed by the
entity acquiring such assets. (Section 8.1)
Events of Default and Limited Rights of Acceleration. Unless otherwise
provided in the applicable Prospectus Supplement, the Indenture defines an Event
of Default as any one of the following events: (a) default for 30 days in the
payment of any interest upon any Notes when it becomes due and payable; (b)
default in the payment of the principal of (or premium, if any, on) any Note at
its maturity; (c) default in the deposit of any sinking fund payment, when and
as due by the terms of the Notes; (d) default in the performance, or breach, of
any covenant or warranty of the Company (other than a covenant or warranty
included in the Indenture solely for the benefit of a series of Notes other than
the Notes) which continues for 60 days after the holders of at least 25% in
principal amount of Outstanding Notes have given written notice as provided in
the Indenture; (e) certain events of bankruptcy, insolvency or reorganization of
the Company; or (f) any other Events of Default as may be specified in a
Prospectus Supplement with respect to the Notes. (Section 5.1) An Event of
Default under one series of Notes will not necessarily be an Event of Default
with respect to any other series of Notes.
If an Event of Default of a type set forth in clause (e) above with respect
to the Notes of any series at the time Outstanding occurs and is continuing,
either the Trustee or the Holders of at least 25% in aggregate principal amount
of the Outstanding Notes of that series may declare the principal amount (or, if
the Notes of that series are Original Issue Discount Securities, such portion of
that principal amount as may be specified in the terms of that series) of all
the Notes of that series to be due and payable immediately. At any time after a
declaration of acceleration with respect to Notes of any series has been made,
but before a judgment or decree based on acceleration has been obtained, the
Holders of a majority in aggregate principal amount of the Outstanding Notes of
that series may, under certain circumstances, rescind and annul such
acceleration. (Section 5.2)
The Indenture does not provide for any right of acceleration of the payment
of the principal of a series of Notes upon a default in the payment of
principal, premium, if any, or interest or a default in the performance
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<PAGE> 17
of any covenant or agreement in the Notes of that series or in the Indenture.
Accordingly, the Trustee and the Holders will not be entitled to accelerate the
maturity of these Notes upon the occurrence of any of the Events of Default
described above, except for those described in clause (e) above. If a default in
the payment of principal, premium, if any, or interest or in the performance of
any covenant or agreement in the Notes of any series or in the Indenture occurs,
the Trustee may, subject to certain limitations and conditions, seek to enforce
payment of such principal, premium, if any, or interest on the Notes of that
series, or the performance of such covenant or agreement. (Section 5.3)
The Indenture provides that, subject to the duty of the Trustee during the
continuance of an Event of Default to act with the required standard of care,
the Trustee will be under no obligation to exercise any of its rights or powers
under the Indenture at the request or direction of any of the Holders, unless
such Holders shall have offered to the Trustee reasonable indemnity. (Section
6.3) Subject to certain limitations, the Holders of a majority in aggregate
principal amount of the Outstanding Notes of any series will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, with respect to the Notes of that series. (Section 5.12) The right of a
Holder of any Notes to institute a proceeding with respect to the Indenture is
subject to certain conditions precedent, but each Holder has an absolute right
to receive payment of principal, premium and interest, if any, when due and to
institute suit for the enforcement of any such payment. (Sections 5.7 and 5.8)
Comerica is required to furnish to the Trustee annually a statement as to
the performance by Comerica of certain of its obligations under the Indenture
and as to any default in such performance. (Sections 1.2 and 10.4) The Trustee
may withhold notice to Holders of any default (except in payment of principal,
premium, or interest, if any) if it in good faith determines that it is in the
interests of the Holders to do so.
Modifications and Waiver. The Indenture provides that Comerica and the
Trustee may enter into a supplemental indenture to amend the Indenture or the
Notes without the consent of any Holder of any Outstanding Notes: (1) to
evidence the succession of another Person to Comerica and the assumption by such
successor of Comerica's obligations under the Indenture; (2) to add to the
covenants of Comerica further covenants, restrictions or conditions for the
protection of the Holders of all or any particular series of Notes; (3) to add
or change any of the provisions of the Indenture necessary to facilitate the
issuance of Notes in bearer form; (4) to eliminate or change any provision of
the Indenture prior to the issuance of the series that is entitled to the
benefit of such provision; (5) to establish the terms and conditions of Notes of
any series; (6) to provide for the acceptance of appointment by a successor
trustee or to add or change any of the provisions of the Indenture necessary to
provide for or facilitate the administration of the trust by more than one
Trustee; (7) to cure any ambiguity, defect or inconsistency or to make such
other provision in regard to matters or questions arising under the Indenture
which do not adversely affect the interests of the Holders of the Notes; (8) to
secure the Notes; (9) to provide for the conversion or exchange of Notes of a
particular series into or for other securities of Comerica; or (10) to add
additional Events of Default. (Section 9.1)
In addition to the foregoing, modifications and amendments of the Indenture
may be made by Comerica and the Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Outstanding Notes of each series
affected by such modification or amendment; provided, however, that no such
modification or amendment may, without the consent of the Holder of each
Outstanding Notes affected thereby, (a) change the stated maturity date of the
principal of, or any premium or installment of interest, if any, on any Notes,
(b) reduce the principal amount of, or premium or interest, if any, on, any
Notes, (c) reduce the amount of principal on an Original Issue Discount Security
payable upon acceleration of the maturity thereof, (d) change the currency of
payment of principal of, or premium or interest, if any, on, any Notes, (e)
impair the right to institute suit for the enforcement of any such payment on or
with respect to any Notes, (f) reduce the percentage in principal amount of
Outstanding Notes of any series the consent of whose Holders is required for
modification or amendment of the Indenture or for any waiver. (Section 9.2)
The Holders of a majority in aggregate principal amount of the Outstanding
Notes of each series may, on behalf of all Holders of Notes of that series,
waive, insofar as that series is concerned, compliance by Comerica with certain
restrictive provisions of the Indenture. (Section 10.8) The Holders of a
majority in aggregate principal amount of the Outstanding Notes of each series
may, on behalf of all Holders of Notes of
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<PAGE> 18
that series, waive any past default under the Indenture with respect to Notes of
that series, except a default in the payment of principal, or of premium or
interest, if any, or in respect of a provision which under the Indenture cannot
be modified or amended without the consent of the Holder of each Outstanding
Notes of that series. (Section 5.13)
Satisfaction and Discharge. The Trustee will discharge the Indenture upon
Company Request when all the authenticated and delivered Notes have been
(a) delivered to the Trustee for cancellation, or (b) the Company has deposited
or caused to be deposited with the Trustee, funds to be held in trust in an
amount sufficient to pay and discharge the entire indebtedness on the Notes not
previously delivered to the Trustee and the Notes have (i) become due and
payable, (ii) will become due and payable at their Stated Maturity within one
year, or (iii) are to be called for redemption within one year. (Section 4.1)
Governing Law. The Indenture and the Notes will be governed by and
construed in accordance with the laws of the State of New York.
Information Concerning the Trustee. Comerica and its subsidiaries maintain
deposit accounts and conduct other banking transactions with the Trustee in the
ordinary course of business.
PLAN OF DISTRIBUTION
Comerica may offer and sell the Notes to or through underwriting syndicates
represented by managing underwriters, which may include Lehman Brothers Inc., to
or through underwriters without a syndicate, to investors directly or through
dealers or agents or any combination of any such methods of sale. The Prospectus
Supplement with respect to each series of the Notes will set forth the terms of
the offering, including the name or names of any underwriters, dealers or
agents, the purchase price and the net proceeds to Comerica from such sale, any
underwriting discounts, agency fees and other items constituting underwriters'
or agents' compensation as well as any indemnification by Comerica, any initial
public offering price and any discounts or concessions allowed, re-allowed or
paid to dealers.
If any underwriters are involved in the offer and sale of the Notes, such
Notes will be acquired by the underwriters and may be resold from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale.
Unless otherwise set forth in the accompanying Prospectus Supplement, the
obligations of the underwriters to purchase the Notes will be subject to certain
conditions precedent and the underwriters will be obligated to purchase all the
Notes described in such Prospectus Supplement if any are purchased. Any initial
public offering price and any discounts or concessions allowed or re-allowed or
paid to dealers may be changed from time to time.
Underwriters, dealers and agents may be entitled, under agreements entered
into with Comerica, to indemnification by Comerica against certain liabilities,
including liabilities under the Securities Act of 1933, as amended.
Certain of the underwriters, dealers or agents may be engaged in
transaction with, and perform services for, Comerica or one or more of its
affiliates in the ordinary course of business.
The place and time of delivery for the Notes in respect of which this
Prospectus is delivered will be set forth in the accompanying Prospectus
Supplement.
LEGAL OPINIONS
The validity of the Notes will be passed upon for Comerica by Miller,
Canfield, Paddock and Stone, P.L.C., 150 West Jefferson, Suite 2500, Detroit,
Michigan 48226, and for the underwriters and agents, if any, by Simpson Thacher
& Bartlett (a partnership which includes professional corporations), New York,
New York. Miller, Canfield, Paddock and Stone, P.L.C. will rely as to matters of
New York law on the opinion of Simpson Thacher & Bartlett.
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<PAGE> 19
EXPERTS
The consolidated financial statements of Comerica incorporated by reference
to the Comerica Annual Report on Form 10-K for the fiscal year ended December
31, 1994, have been audited by Ernst & Young LLP, independent accountants and
have been so incorporated herein in reliance upon such reports, given on the
authority of such firm as an expert in auditing and accounting.
13
<PAGE> 20
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND
THE ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY COMERICA,
ANY AGENT, UNDERWRITER OR DEALER OR ANY OTHER PERSON. NEITHER THIS PROSPECTUS
NOR THE ACCOMPANYING PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY TO ANY
PERSON OR BY ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION MAY NOT
LAWFULLY BE MADE. NEITHER THE DELIVERY OF THIS PROSPECTUS AND THE ACCOMPANYING
PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAD BEEN NO CHANGE IN THE
AFFAIRS OF COMERICA SINCE THE DATE HEREOF.
-------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS SUPPLEMENT
Use of Proceeds....................... S-2
Selected Consolidated Financial Data
of Comerica Incorporated............ S-3
Capitalization........................ S-4
Description of Subordinated Notes..... S-4
Underwriting.......................... S-6
PROSPECTUS
Available Information................. 2
Incorporation of Certain Documents by
Reference........................... 2
Comerica Incorporated................. 2
Consolidated Ratios of Earnings to
Fixed Charges....................... 6
Use of Proceeds....................... 6
Description of the Notes.............. 6
Plan of Distribution.................. 12
Legal Opinions........................ 12
Experts............................... 13
</TABLE>
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$150,000,000
COMERICA
INCORPORATED
7 1/4% SUBORDINATED NOTES
DUE AUGUST 1, 2007
-------------------------
PROSPECTUS SUPPLEMENT
August 2, 1995
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LEHMAN BROTHERS
CS FIRST BOSTON
MORGAN STANLEY & CO.,
INCORPORATED
SALOMON BROTHERS INC
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