<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
INDEPENDENCE HOLDING COMPANY
.................................................................
(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] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction
applies:
.................................................................
2) Aggregate number of securities to which transaction
applies:
.................................................................
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it was
determined):
.................................................................
4) Proposed maximum aggregate value of transaction:
.................................................................
5) Total fee paid:
.................................................................
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
1) Amount Previously Paid:
.................................................................
2) Form, Schedule or Registration Statement No.:
.................................................................
3) Filing Party:
.................................................................
4) Date Filed:
.................................................................
<PAGE>
INDEPENDENCE HOLDING COMPANY
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 6, 1995
------------------------
To the Stockholders of
INDEPENDENCE HOLDING COMPANY:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
INDEPENDENCE HOLDING COMPANY (the 'Company') will be held on June 6, 1995 at
9:30 A.M., local time, at the Meeting Room, Greenwich Public Library, 101 West
Putnam Avenue, Greenwich, Connecticut for the following purposes:
1. To elect eight directors of the Company;
2. To vote upon a proposal to ratify the selection of independent
auditors; and
3. To transact such other business as may properly come before the
meeting and any adjournment thereof.
Only stockholders of record at the close of business on April 18, 1995 are
entitled to notice of, and to vote at, the Annual Meeting of Stockholders.
Your attention is directed to the Proxy Statement submitted with this
notice. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, PLEASE DATE AND
SIGN THE ENCLOSED FORM OF PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
IN THE EVENT A STOCKHOLDER DECIDES TO ATTEND THE MEETING, SUCH STOCKHOLDER MAY
REVOKE SUCH PROXY AND VOTE SUCH SHARES IN PERSON. No postage need be affixed to
the enclosed envelope if mailed in the United States.
By Order of the Board of Directors
DAVID T. KETTIG
Secretary
April 27, 1995
<PAGE>
INDEPENDENCE HOLDING COMPANY
96 CUMMINGS POINT ROAD
STAMFORD, CONNECTICUT 06902
203-358-8000
--------------------------
PROXY STATEMENT
--------------------------
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Independence Holding Company (the 'Company') of
Proxies to be used at the Annual Meeting of Stockholders to be held at the
Meeting Room, Greenwich Public Library, 101 West Putnam Avenue, Greenwich,
Connecticut on June 6, 1995 at 9:30 A.M., local time. In addition to
solicitation of Proxies by mail, the directors, officers and employees of the
Company may solicit Proxies personally, by telephone, telefax or telegram. The
expense of all such solicitation, including the cost of preparing, printing and
mailing this Proxy Statement, will be borne by the Company. The Company will,
upon request, reimburse brokers, banks or other persons for their reasonable
out-of-pocket expenses in forwarding proxy material to beneficial owners of the
Company's shares. This Proxy Statement and the accompanying Proxy and the
Company's Annual Report to Stockholders, which contains financial statements for
the year ended December 31, 1994, will first be mailed to stockholders of the
Company on or about April 27, 1995.
If the enclosed form of Proxy is executed and returned, it will be voted as
directed by the stockholder. If no directions are given, Proxies will be voted
for election as directors of all of the nominees specified therein and for the
ratification of the selection of KPMG Peat Marwick LLP ('Peat Marwick') as
independent auditors for the calendar year 1995. A Proxy may be revoked at any
time, insofar as the authority granted thereby has not been exercised at the
Annual Meeting of Stockholders, by filing with the Secretary of the Company a
written revocation or a duly executed Proxy bearing a later date. Any
stockholder present at the meeting may vote personally on all matters brought
before the meeting and, in that event, such stockholder's Proxy will not be used
at the meeting by holders of the Proxy.
Only stockholders of record as of the close of business on April 18, 1995
will be entitled to vote at the meeting. On that date, the Company had
outstanding and entitled to one vote per share, 15,421,730 shares of Common
Stock, par value $1 per share ('Common Stock'). An additional 4,377,900 shares
of Common Stock are held by subsidiaries of the Company and are not entitled to
vote. A majority of the outstanding shares will constitute a quorum at the
meeting. Abstentions and broker non-votes are counted for purposes of
determining the presence or absence of a quorum for the transaction of business.
Abstentions are counted in tabulations of the votes cast on proposals presented
to stockholders, whereas broker non-votes are not counted for purposes of
determining whether a proposal has been approved.
If no contrary instruction is indicated, shares represented by properly
executed Proxies in the accompanying form of proxy will be voted by the persons
designated in the printed portion thereof FOR the election of the nominees named
below to serve as directors for a one-year term and FOR the ratification of the
selection of Peat Marwick as independent auditors for the calendar year 1995.
Each director must be elected by the affirmative vote of a plurality of the
votes cast at the meeting by the holders of shares of Common Stock represented
in person or by Proxy. Approval of Peat Marwick as
<PAGE>
independent auditors requires the affirmative vote of a majority of the shares
of Common Stock present or represented at the meeting.
Management does not know of any other matters to be brought before the
meeting at this time; however, if any other matters are brought before the
meeting, the proxy holder shall vote in his discretion with respect to the
matter. In the event a stockholder specifies a different choice on the Proxy,
such stockholder's shares will be voted or withheld in accordance with the
specifications so made. Should any nominee for director named herein become
unable or unwilling to accept nomination or election, it is intended that the
persons acting under proxy will vote for the election of such other person as
the Board of Directors of the Company may recommend unless the number of
directors is reduced by the Board of Directors. The Company has no reason to
believe that any nominee will be unable or unwilling to serve if elected to
office.
PRINCIPAL STOCKHOLDERS
Listed below are the number of shares of Common Stock beneficially owned as
of April 18, 1995 by the holders of more than 5% of the Common Stock of the
Company.
<TABLE>
<CAPTION>
COMMON STOCK
------------
<S> <C>
Geneve Holdings, Inc.(1) ..................................................... 8,185,815
96 Cummings Point Road (53.08%)
Stamford, Connecticut 06902
</TABLE>
- ------------
(1) According to (i) information disclosed in Amendment No. 33 to Schedule 13D
dated May 13, 1993 of Geneve Holdings, Inc. (together with its affiliates
also referred to herein as 'Geneve') supplemented by (ii) information
provided to the Company by Geneve in response to a Company questionnaire, a
group consisting of Geneve and certain of its affiliates are the beneficial
owners of 8,185,815 shares of Common Stock. As of December 31, 1994, Geneve
did not own any of the Company's share purchase warrants (the 'Warrants').
Edward Netter, Chairman and Chief Executive Officer and a director of the
Company, is an executive officer and a director of Geneve. Donald T. Netter,
an executive officer and a director of the Company, is an executive officer
of Geneve. Edward Netter and members of his family (including Donald T.
Netter) own more than 50% of the voting stock of Geneve. Edward Netter and
Donald T. Netter disclaim beneficial ownership as to the shares of Common
Stock owned by Geneve.
------------------------
To the best knowledge of the Company, Geneve has sole investment and voting
power with respect to the shares listed above, and no other person or persons
acting in concert own beneficially more than 5% of the Common Stock.
The following table sets forth for each director of the Company, the Chief
Executive Officer and the four other most highly compensated executive officers
of the Company for the year ended December 31, 1994 (the 'Named Officers'), and
for all directors and executive officers of the Company as a group, information
regarding beneficial ownership of Common Stock as of April 18, 1995. None of
2
<PAGE>
the directors, Named Officers or directors and executive officers as a group
owns beneficially any Warrants.
<TABLE>
<CAPTION>
NUMBER PERCENT OF
OF CLASS
NAME SHARES ENTITLED TO VOTE
- --------------------------------------------------------------------- ------- ----------------
<S> <C> <C>
Harold E. Johnson.................................................... 20,000(1) *
Allan C. Kirkman..................................................... 7,000(1) *
Steven B. Lapin...................................................... 1,000(2) *
Donald T. Netter..................................................... - 0 -(3) --
Edward Netter........................................................ - 0 -(3) --
Edward J. Scheider................................................... 150,473(1)(4) *
Roy T.K. Thung....................................................... 2,500(5) *
F. Peter Zoch, III................................................... 1,000(6) *
David T. Kettig...................................................... - 0 -(7) --
Teresa A. Herbert.................................................... 6,100(8) *
All directors and executive officers as a group (11 persons)......... 189,073(1)(2)(3) 1.23 %
(5)(6)(7)(8)
</TABLE>
- ------------
(1) Constitutes or includes 7,000 shares of Common Stock subject to options
granted to each such director of which, in each case, all shares are
presently exercisable.
(2) Does not include 137,500 shares of Common Stock subject to options granted
to Mr. Lapin in April 1995, which will vest ratably over three years
commencing in April 1996.
(3) Edward Netter and Donald T. Netter disclaim beneficial ownership of the
shares of Common Stock shown as owned by Geneve in the table relating to
Principal Stockholders. Reference is also made to footnote (1) to such
table.
(4) Includes 67,000 shares of Common Stock owned by Mr. Scheider's wife, as to
which shares Mr. Scheider disclaims beneficial ownership.
(5) Does not include 112,500 shares of Common Stock subject to options granted
to Mr. Thung in April 1995, which will vest ratably over three years
commencing in April 1996.
(6) Constitutes 1,000 shares of Common Stock subject to options granted to Mr.
Zoch, all of which shares are presently exercisable.
(7) Does not include 25,000 shares of Common Stock subject to options granted to
Mr. Kettig in April 1995, which will vest ratably over three years
commencing in April 1996.
(8) Includes 5,000 shares of Common Stock subject to options granted to Ms.
Herbert, all of which shares are presently exercisable. Does not include
25,000 shares of Common Stock subject to options granted to Ms. Herbert in
April 1995, which will vest ratably over three years commencing in April
1996.
* Represents less than 1% of the outstanding Common Stock.
3
<PAGE>
PROPOSAL 1
NOMINEES FOR ELECTION AS DIRECTORS
Eight directors will be elected at the meeting, each to hold office until
the next Annual Meeting of Stockholders and until such director's successor
shall be elected and shall qualify.
It is intended that shares represented by Proxies will be voted for the
election of the nominees named below. If at the time of the meeting any of the
nominees should be unwilling or unable to serve, the discretionary authority
provided in the Proxy will be exercised to vote for a substitute or substitutes,
as the Board of Directors recommends. The Board has no reason to believe that
any of the nominees will be unwilling or unable to serve as a director.
The persons named below have been nominated for election as directors. All
of such nominees presently serve as directors of the Company.
HAROLD E. JOHNSON, age 76
Director
Since November 1987, director of the Company; for more than five years
prior to retirement in 1983, Executive Vice President of The Continental
Corporation, a diversified insurance and financial holding company with
principal offices in New York, New York; since November 1993, director of Queens
County Bancorp, Inc., a banking holding company with principal offices in Queens
County, New York.
ALLAN C. KIRKMAN, age 51
Director
Since December 1980, director of the Company; for more than the past five
years, Executive Vice President of Mellon Bank, N.A., a national bank with
principal offices in Pittsburgh, Pennsylvania.
STEVEN B. LAPIN, age 49
President and Chief Operating Officer
Director
Since July 1991, director of the Company; since November 1993, President
and Chief Operating Officer of the Company; for more than three years prior to
November 1993, Executive Vice President -- Operations of the Company; since
October 1993, President and Chief Operating Officer of Geneve Corporation, a
private diversified holding company with principal offices in Stamford,
Connecticut, which is an affiliate of the Company ('Geneve'); for more than
three years prior to October 1993, Executive Vice President and Chief Operating
Officer of Geneve; for more than the past five years, director of Geneve.
DONALD T. NETTER, age 33
Senior Vice President -- Investments
Director
Since November 1993, director of the Company; since January 1995, Senior
Vice President -- Investments of the Company; since February 1994, Senior Vice
President -- Investments of Geneve; from February 1992 to August 1993, Senior
Vice President and Treasurer of Damon Corp., a clinical laboratory testing
company with principal offices in Needham Heights, Massachusetts ('Damon'); for
4
<PAGE>
more than two years prior to February 1992, Vice President of Damon; for more
than four years prior to August 1993, a director of Damon. Mr. Donald T. Netter
is the son of Mr. Edward Netter.
EDWARD NETTER, age 62
Chairman and Chief Executive Officer
Director
Since December 1980, director of the Company; since July 1990, Chairman and
Chief Executive Officer of the Company; from December 1990 to November 1993,
President of the Company; from May 1990 to July 1990, Co-Chairman of the Board
and Co-Chief Executive Officer of the Company; for more than the past five
years, Chairman, Chief Executive Officer and director of Geneve.
EDWARD J. SCHEIDER, age 78
Director
Since November 1987, director of the Company and Chairman of the Audit
Committee; for more than five years prior to retirement in March 1995, Vice
President of Kidder, Peabody & Co., Inc., an investment banking and brokerage
firm with principal offices in New York, New York.
ROY T.K. THUNG, age 51
Executive Vice President,
Chief Financial Officer and Treasurer
Director
Since December 1990, director of the Company; since November 1993,
Executive Vice President, Chief Financial Officer and Treasurer of the Company;
from May 1990 to November 1993, Senior Vice President, Chief Financial Officer
and Treasurer of the Company; from June 1983 to December 1986, director of the
Company; since November 1993, Executive Vice President and Chief Financial
Officer of Geneve, for more than five years prior to November 1993, Senior Vice
President and Chief Financial Officer of Geneve.
F. PETER ZOCH, III, age 52
Director
Since December 1980, director of the Company; from December 1990 to June
1993, Vice Chairman of the Board of the Company; for more than the past five
years, Chairman of the Executive Committee of the Company; for more than five
years prior to July 1992, President and director of Geneve.
------------------------
Between January 1, 1994 and December 31, 1994, the Board of Directors of
the Company met three times. In addition, the Audit Committee of the Board,
which exercises responsibility in respect of the recommendation of the Company's
independent public auditors, the review of such auditor's audit and
recommendations concerning internal controls, met twice. The Audit Committee
currently consists of Messrs. Scheider and Johnson. Each director who has been
nominated for election as a director attended at least 75% of the Board meetings
and meetings of Committees on which such director served, other than Mr. Zoch
who attended one-third of such meetings.
5
<PAGE>
Directors of the Company who are not also officers of the Company receive a
monthly fee of $500 plus $400 for each Board or Committee meeting attended.
Directors who are officers of the Company do not receive compensation for
serving as directors of the Company.
Pursuant to the Company's 1988 Stock Incentive Plan, directors of the
Company who are not also employees of the Company or a subsidiary ('Independent
Directors') are each granted non-qualified stock options with respect to 1,000
shares of Common Stock at the first meeting of the Board of Directors following
each Annual Meeting of Stockholders of the Company, which stock options vest six
months after date of grant. Outstanding options granted at such 1994 Board
meeting fully vested on January 19, 1995, and have an exercise price of $3.1875
per share.
EXECUTIVE OFFICERS
In addition to Messrs. Lapin, Donald T. Netter, Edward Netter and Thung,
listed above, who also serve as directors of the Company, set forth below are
each executive officer's name, age, all positions and offices held with the
Company, principal occupations and business experience during the past five
years. Officers are elected by the Board of Directors, each to serve until his
successor is elected and has qualified, or until his earlier resignation,
removal from office or death.
TERESA A. HERBERT, age 33
Vice President and Controller
Since October 1991, Vice President and Controller of the Company; for more
than three years prior thereto, Assistant Controller of the Company.
DAVID T. KETTIG, age 36
Vice President -- Legal and Secretary
Since March 1992, Vice President -- Legal and Secretary of the Company;
since March 1992, Vice President -- Legal and Secretary of Geneve; for more than
four years prior thereto, associate attorney practicing in the areas of
corporate and securities law with Battle Fowler, a law firm located in New York,
New York.
BRIAN R. SCHLIER, age 40
Vice President -- Taxation
Since May 1991, Vice President -- Taxation of the Company; for more than
the past five years, Director of Taxation of Geneve.
6
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth compensation paid by the Company and its
subsidiaries to those persons who were, at December 31, 1994, the Named
Officers.
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
---------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
-------------------------------- ----------------------- -------
(A) (B) (C) (D) (E) (F) (G) (H) (I)
SECURITIES
OTHER ANNUAL RESTRICTED UNDERLYING LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION STOCK OPTIONS PAYOUTS COMPENSATION(1)
POSITION YEAR ($) ($) ($) AWARDS ($) (#) ($) ($)
- -------------------------- ---- ------- ------- ------------ ---------- ---------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Edward Netter ............ 1994 251,040 50,000 -- -- -- -- 2,653
Chairman and Chief 1993 291,000 50,000 -- -- -- -- 2,538
Executive Officer 1992 291,000 50,000 -- -- -- -- 2,527
Steven B. Lapin .......... 1994 249,990 150,000 -- -- -- -- 113,108
President and Chief 1993 225,000 150,000 -- -- -- -- 90,260
Operating Officer 1992 200,000 150,000 -- -- -- -- 87,849
Roy T.K. Thung ........... 1994 200,000 120,000 -- -- -- -- 98,953
Executive Vice 1993 180,000 120,000 -- -- -- -- 78,965
President, Chief 1992 115,000 120,000 -- -- -- -- 76,861
Financial Officer, and
Treasurer
David T. Kettig(2) ....... 1994 99,455 23,332 -- -- -- -- (7,095)
Vice President -- Legal 1993 102,000 23,331 -- -- -- -- 10,152
and Secretary 1992 74,616 15,667 -- -- -- -- 12,364
Teresa A. Herbert ........ 1994 88,259 20,500 -- -- -- -- (6,848)
Vice President and 1993 84,864 20,500 -- -- -- -- 10,228
Controller 1992 81,600 20,500 -- -- -- -- 12,677
</TABLE>
- ------------
(1) Amounts shown for 1992, 1993 and 1994 for Mr. Netter consist of the dollar
value of premiums paid by the Company and its subsidiaries for term life
insurance. Amounts shown for Messrs. Lapin and Thung consist of the dollar
value of premiums paid by the Company for term life insurance and of amounts
accrued during 1992, 1993 and 1994 under Retirement Benefit Agreements with
the Company (described below under the heading 'Retirement Benefit
Agreements'). Amounts shown for Mr. Kettig and Ms. Herbert consist of the
dollar value of premiums paid by the Company for term life insurance and of
the value of incentive units based on the increase or decrease in book value
per share of the Company's Common Stock for each of calendar years 1992,
1993 and 1994. Certain of the Named Officers also received compensation and
benefits during 1992, 1993 and 1994 from Geneve and/or its affiliates (other
than the Company) for services rendered to such companies, which amounts are
not included in this table.
(2) Mr. Kettig became an executive officer of the Company in March 1992.
7
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table sets forth the number of shares of Common Stock
underlying unexercised options at December 31, 1994 of the Named Officers. No
options were exercised in 1994 by the Named Officers. Ms. Herbert's options were
not in-the-money at December 31, 1994.
<TABLE>
<CAPTION>
(A) (B) (C) (D) (E)
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
SHARES FY-END(#) FY-END($)
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE UNEXERCISABLE
- ---------------------------------------------------------- ----------- ----------- ------------- -------------
<S> <C> <C> <C> <C>
Teresa A. Herbert......................................... 0 0 5,000/0 0
</TABLE>
PENSION PLAN
Standard Security Life Insurance Company of New York, a wholly owned
subsidiary of the Company, terminated its qualified defined benefit pension plan
effective March 31, 1991. In August 1992, Mr. Netter received a lump sum payment
of approximately $158,000, representing his accrued benefit under such plan
based upon his 14 years of credited service. This amount is not included in the
Summary Compensation Table set forth above.
RETIREMENT BENEFIT AGREEMENTS
In 1991, the Company entered into retirement benefit agreements with
Messrs. Lapin and Thung pursuant to which they are entitled to receive cash
payments, based upon their salaries, at such time as they retire or otherwise
terminate their employment with the Company. No monies are owed under these
respective agreements unless the individual remains continuously employed by the
Company until April 30, 1995 or unless certain accelerated vesting events occur.
Assuming that such individuals' employment with the Company had terminated, and
vesting had occurred, on December 31, 1994, Messrs. Lapin and Thung would have
been entitled to receive approximately $383,000 and $334,000, respectively,
which amounts increase each year they remain employed by the Company until they
attain age 62. Of such amounts, $111,000 and $96,000, respectively, were accrued
in 1994 for Messrs. Lapin and Thung.
BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION
Management's recommendations as to the form and level of compensation of
the Company's executive officers are overseen by and subject to the approval of
the Company's Board of Directors.
The Company's compensation policies seek to attract and retain key
executives necessary to the long-term success of the Company, to align
compensation with both annual and long-term strategic plans and goals and to
reward performance in the continued growth and success of the Company and in the
enhancement of shareholder values. In furtherance of these goals, the Company
has employed a combination of annual base salaries, which are set at levels
which management believes to be competitive with industry and regional pay
practices and economic conditions, and annual and longer term incentive
compensation, including an incentive unit plan based on increases in the
Company's book value per share, and options to purchase Common Stock.
Management recommends annually a bonus pool for the Company's employees
(including the executive officers) to be voted upon by the independent members
of the Board. For example, in determining the bonus pool for the 1992 through
1994 calendar years, the Board based its decision, in
8
<PAGE>
major part, on management's accomplishments in successfully restructuring its
insurance group through cost savings and other measures, enhancing the insurance
group's capital position, strategically planning the direction of the insurance
group, improving the Company's profitability and increasing shareholder values.
Specifically regarding the chief executive officer, Edward Netter, base
salary has been determined by considering Company and individual performance.
Mr. Netter's annual bonus payments are subject to approval by the independent
members of the Board of Directors. Although Mr. Netter's bonus is based on his
individual performance as chief executive officer, in determining such amount,
the Board at the same time recognizes Mr. Netter's significant interest in the
Company through his controlling ownership of Geneve.
MEMBERS OF THE BOARD OF DIRECTORS:
<TABLE>
<S> <C>
HAROLD E. JOHNSON EDWARD NETTER
ALLAN C. KIRKMAN EDWARD J. SCHEIDER
STEVEN B. LAPIN ROY T.K. THUNG
DONALD T. NETTER F. PETER ZOCH, III
</TABLE>
PERFORMANCE GRAPH
Set forth below is a line graph comparing the five year cumulative total
return of the Common Stock with that of the Nasdaq Stock Market (US) Index and
the Nasdaq Stock Market Insurance Index.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG INDEPENDENCE HOLDING COMPANY, NASDAQ STOCK MARKET (U.S.) INDEX
AND NASDAQ INSURANCE STOCKS INDEX
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
12/31/89 12/31/90 12/31/91 12/31/92 12/31/93 12/31/94
<S> <C> <C> <C> <C> <C> <C>
NASDAQ STOCK MARKET (U.S.) INDEX 100 85 136 158 181 177
NASDAQ INSURANCE STOCKS INDEX 100 85 119 162 173 163
INDEPENDENCE HOLDING COMPANY 100 36 33 66 95 80
</TABLE>
* Assumes that dividends were reinvested and is based on a $100 investment on
December 31, 1989; indices data obtained from Center for Research in Security
Prices (CRSP)
9
<PAGE>
RELATED PARTY TRANSACTIONS
The Company and Geneve operate under cost-sharing arrangements pursuant to
which certain items are allocated between the companies. From January 1, 1994
through March 31, 1995, the Company paid to Geneve or accrued for payment
thereto approximately $192,000 under such arrangements. Geneve also provides the
Company the use of office space as its corporate headquarters for annual
consideration of $262,500. In addition, certain current or former directors,
officers and/or employees of the Company or its subsidiaries, who are also
current or former directors, officers and/or employees of Geneve, received
compensation and benefits from Geneve for services rendered thereto since
January 1, 1994. All of the foregoing are subject to the approval of the Audit
Committee of the Board of Directors at least annually, and management of the
Company believes that the terms thereof are no less favorable than could be
obtained by the Company from unrelated parties on an arm's length basis.
At various times since January 1, 1994, certain securities transfers were
made between the Company and/or certain of its subsidiaries, on the one hand,
and Geneve, on the other hand, at fair market value.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors has selected Peat Marwick as the auditors of the
Company for the year 1995. It is anticipated that representatives of Peat
Marwick, who also served as the Company's auditors for 1994, will be present at
the Annual Meeting of Stockholders and will have an opportunity to make a
statement if they so desire and to answer any appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE 'FOR' PROPOSAL 2.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder intends to present at the Annual Meeting
of Stockholders to be held in 1996 must be received at the Company's principal
executive office not later than December 31, 1995 in order to be includable in
the proxy material for such meeting.
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors knows of no
other business to be presented for action at the meeting. As to any business
which would properly come before the meeting, the Proxies confer discretionary
authority in the persons named therein and those persons will vote or act in
accordance with their best judgment with respect thereto.
By Order of the Board of Directors
DAVID T. KETTIG
Secretary
April 27, 1995
10
<PAGE>
APPENDIX 1
PROXY CARD
INDEPENDENCE HOLDING COMPANY
96 CUMMINGS POINT ROAD, STAMFORD, CONNECTICUT 06902
PROXY -- SOLICITED BY THE BOARD OF DIRECTORS
The undersigned stockholder of Independence Holding Company (the 'Company')
hereby appoints Steven B. Lapin and David T. Kettig, and each or either of them,
the true and lawful proxies, agents and attorneys of the undersigned, each with
full power to act without the other and with full power of substitution to vote
all shares of the Company which the undersigned would be entitled to vote if
personally present at the Annual Meeting of Stockholders of the Company to be
held on Tuesday, June 6, 1995 at 9:30 A.M., E.D.T., at the Meeting Room,
Greenwich Public Library, 101 West Putnam Avenue, Greenwich, Connecticut, and at
any adjournment or postponement thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE 'FOR' ALL PROPOSALS.
(1) To elect eight directors.
<TABLE>
<S> <C>
[ ] FOR all nominees listed below (except as instructed below) [ ] WITHHOLD AUTHORITY to vote for all nominees listed below
</TABLE>
Harold E. Johnson, Allan C. Kirkman, Steven B. Lapin, Donald T. Netter,
Edward Netter, Edward J. Scheider, Roy T.K. Thung, F. Peter Zoch, III
INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name here:
...............................................................................
<TABLE>
<S> <C>
(2) To ratify the appointment of KPMG Peat Marwick LLP [ ] FOR [ ] AGAINST [ ] ABSTAIN
as independent auditors for the fiscal year ending December 31, 1995
(3) To transact any other business that may properly come before the Annual Meeting and any adjournment or postponement
thereof.
</TABLE>
The shares represented by this proxy card will be voted as directed above. IF NO
DIRECTION IS GIVEN AND THE PROXY CARD IS VALIDLY EXECUTED, THE SHARES WILL BE
VOTED FOR ALL LISTED PROPOSALS.
(see reverse)
<PAGE>
The undersigned hereby ratifies and confirms all that said proxies, agents
and attorneys, or any of them or their substitutes, lawfully may do at the
meeting and hereby revokes all proxies heretofore given by the undersigned to
vote at said meeting or any adjournment or postponement thereof.
<TABLE>
<S> <C>
PLEASE SIGN THE PROXY EXACTLY AS YOUR NAME(S) Dated ................................... , 1995
APPEARS HEREON. JOINT OWNERS SHOULD EACH SIGN (L.S.)
PERSONALLY. TRUSTEES AND OTHER FIDUCIARIES ................................................
SHOULD INDICATE THE CAPACITY IN WHICH THEY SIGN, (L.S.)
AND WHERE MORE THAN ONE NAME APPEARS, A MAJORITY ................................................
MUST SIGN. IF A CORPORATION, THE SIGNATURE
SHOULD BE THAT OF AN AUTHORIZED OFFICER WHO
SHOULD STATE HIS TITLE.
</TABLE>
PLEASE DATE, SIGN AND RETURN. YOUR PROMPT ATTENTION WILL BE APPRECIATED.
