<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/X/ Preliminary proxy statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
First Independence Corporation
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
First Independence Corporation
- - --------------------------------------------------------------------------------
(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 Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 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> 2
FIRST INDEPENDENCE
CORPORATION
44 MICHIGAN AVE., DETROIT, MICHIGAN 48226
TELEPHONE 313-256-8400
April 18, 1995
To Our Shareholders:
You are cordially invited to attend the 1995 Annual Meeting of
Shareholders of First Independence Corporation, which will be held at 6:00 p.m.
on Tuesday, May 23, 1995, at the Livernois Branch office at 12200 Livernois,
Detroit, Michigan.
This letter is accompanied by a notice of annual meeting and proxy
statement and a proxy card. The Corporation's Annual Report on Form 10-KSB
for the year ended December 31, 1994, as filed with the Securities and Exchange
Commission, also is enclosed.
At the meeting, shareholders will: 1) elect six (6) directors to serve
for one year and until their successors are duly elected and qualified; 2)
approve the 1995 Stock Option Plan for key employees and directors of the
Corporation and its subsidiaries; and 3) transact such other business as may
properly come before the meeting or any adjournment of it.
The enclosed notice of annual meeting and proxy statement should be
read carefully. They describe matters which are important for the Corporation
and its subsidiary, the Bank. Please sign and date the enclosed proxy card and
mail it promptly in the return envelope whether or not you plan to attend the
meeting. If you are present at the meeting and wish to vote in person, you may
withdraw your proxy and vote in person.
Very truly yours,
Don Davis
Chairman of the Board
IT IS IMPORTANT THAT YOUR SHARES BE VOTED AT THE MEETING. PLEASE SIGN AND
DATE THE ENCLOSED PROXY CARD AND RETURN IT TO THE CORPORATION.
<PAGE> 3
Op
FIRST INDEPENDENCE CORPORATION
44 MICHIGAN AVENUE
DETROIT, MICHIGAN 48226
(313) 256-8400
______________
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TUESDAY, MAY 23, 1995
The 1995 Annual Meeting of the shareholders of First Independence
Corporation will be held at the Livernois Branch office of First Independence
National Bank of Detroit, 12200 Livernois, Detroit, Michigan, on Tuesday, May
23, 1995, at 6:00 p.m., for the following purposes:
(1) To elect 6 directors to hold office until the next annual meeting and
until their successors are elected and qualified; and
(2) To approve the 1995 Stock Option Plan for key employees and directors of
the Corporation and its subsidiaries; and
(3) To transact such other business as may properly come before the meeting
or any adjournment thereof.
Information concerning these matters is set forth in the accompanying
Proxy Statement. Only those common shareholders of record at the close of
business on April 14, 1995, are entitled to notice of and to vote at the Annual
Meeting.
IN ORDER TO ASSURE THAT YOUR SHARES WILL BE REPRESENTED AND VOTED AT
THE ANNUAL MEETING, PLEASE SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN IT
PROMPTLY IN THE RETURN ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING, YOU MAY
WITHDRAW YOUR PROXY AND VOTE IN PERSON.
Don Davis
Chairman of the Board
April 18, 1995
<PAGE> 4
FIRST INDEPENDENCE CORPORATION
44 MICHIGAN AVENUE
DETROIT, MICHIGAN 48226
(313) 256-8400
_______________
PROXY STATEMENT
DATED APRIL 18, 1995
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD
MAY 23, 1995
GENERAL INFORMATION
This Proxy Statement and the accompanying form of proxy are furnished
in connection with the solicitation of proxies by the Board of Directors of
First Independence Corporation (the "Corporation") for use at the annual
meeting of shareholders to be held at the Livernois Branch Office, 12200
Livernois, of First Independence National Bank of Detroit, Detroit, Michigan,
at 6:00 p.m. on Tuesday, May 23, 1995 (the "Annual Meeting").
This Proxy Statement is being mailed on or about April 18, 1995 to all
holders of record of Common Stock as of the close of business on April 14,
1995. The cost of this solicitation will be borne by the Corporation. In
addition to solicitation by the use of mail, the directors, and officers of the
Corporation, without additional compensation, may solicit proxies personally or
by telephone or mail. A shareholder giving a proxy in connection with this
solicitation has the power to revoke it at any time prior to its exercise at
the Annual Meeting either by written notice received by the Corporation (Attn:
Secretary) at the address shown above at least 24 hours before the Annual
Meeting or by announcement of revocation at the Annual Meeting.
The purposes of the Annual Meeting are to:
1) Elect 6 directors to serve until the next annual meeting of
shareholders and until their successors are elected and
qualified;
2) Approve the 1995 Stock Option Plan for key employees and
directors of the Corporation and its subsidiaries; and
3) Transact such other business as properly may come
before the meeting or any adjournment thereof.
As of April 14, 1995, there were 336,760 shares of the Corporation's
common stock, par value $1.00 per share, outstanding, 4,000 shares of Class A
Preferred Stock, par value $100.00 per share, 3,200 shares of Class B
Preferred Stock, par value $100.00 per share, outstanding, and 1,500 shares of
Class C Preferred Stock, Series MI-1, no par value, outstanding, and 436.6717
shares of Class C Preferred Stock, Series 1994-1, no par value, outstanding.
Those common shareholders of record at the close of business on April 14,
1995, are entitled to vote at the meeting. As of that date, there were
approximately 2,100 record holders of the Corporation's common stock. Each
share of common stock is entitled to one vote on each matter presented.
OWNERSHIP OF THE CORPORATION'S EQUITY SECURITIES
The following table furnishes information with respect to the
beneficial owners of more than five percent of any class of the Corporation's
equity securities as of April 14, 1995.
1
<PAGE> 5
<TABLE>
<CAPTION>
Amount and
Nature of
Name and Address of Beneficial Percent of
Title of Class Beneficial Owner Ownership* Class
- - -------------- ---------------- ---------- -----
<S> <C> <C> <C>
Common Don Davis 198,721 59.01
Stock 15855 Wyoming
Detroit, Michigan
Common First Independence Corp. 36,363 10.80
Stock Employee Stock
Ownership Trust
44 Michigan Avenue
Detroit, Michigan
Class A S.B.A., Receiver for 3,000 75.00
Preferred Independence Capital
Formation, Inc.
Washington, D.C.
Class A Tower Ventures, Inc. 1,000 25.00
Preferred 3333 Beverly Road (A C258A
Hoffman Estates, IL 60179
Class B Dearborn Capital Corp. 2,000 62.50
Preferred P.O. Box 1729
Dearborn, Michigan
Class B Hudson-Webber Foundation 1,200 37.50
Preferred 333 West Fort Street
Detroit, Michigan
Class C Michigan State Housing 1,500 100.00
Preferred Development Authority
(Series MI-1) 1200 6th Street
Detroit, Michigan 48226
Class C Blue Cross-Blue Shield of Michigan 111.150 25.82
Preferred 600 E. Lafayette
(Series 1994-1) Detroit, Michigan 48226
Class C Dearborn Capital Corp. 70.583 16.40
Preferred P.O. Box 1729
(Series 1994-1) Dearborn, Michigan
Class C S.B.A., Receiver for 70.625 16.41
Preferred Independence Capital
(Series 1994-1) Formation, Inc.
Washington, D.C.
Class C Tower Ventures 56.417 13.11
Preferred 12655 North Central Expressway
(Series 1994-1) Dallas, TX 75243
</TABLE>
2
<PAGE> 6
<TABLE>
<CAPTION>
Amount and
Nature of
Name and Address of Beneficial Percent of
Title of Class Beneficial Owner Ownership* Class
- - -------------- ---------------- ---------- -----
<S> <C> <C> <C>
Class C Hudson-Webber Foundation 28.250 6.57
Preferred 333 West Fort Street
(Series 1994-1) Detroit, Michigan
Class C Motor Enterprises 32.875 7.64
Preferred 3044 W. Grand Blvd.
(Series 1994-1) Detroit, Michigan 48202
Class C AAA of Michigan 26.125 6.07
Preferred 1 Auto Club Drive
(Series 1994-1) Dearborn, Michigan 48126
Class C G Tech Inc. 34.333 7.98
Preferred 55 Technology Way
(Series 1994-1) West Greenwich, RI 02817
</TABLE>
* Each owner possesses sole voting and investment power with respect to
the shares shown except as follows. The number of shares shown for
Mr. Davis includes 3,845 shares credited to his account under the
First Independence Corporation Employee Stock Ownership Plan as of
December 31, 1994, for which he only has sole voting power. The shares
shown for the First Independence Employee Stock Ownership Trust are
voted by the independent Trustee, except that participants in the
First Independence Corporation Employee Stock Ownership Plan are
entitled to direct the Trustee as to the manner of voting shares
allocated to their accounts. As of December 31, 1994, all shares held
by the Trust were allocated to participant's accounts. Shares of
preferred stock are not entitled to vote in the election of directors,
except that shares of Class A Preferred Stock may elect additional
directors in the case of certain dividend arrearage. Although there
are dividend arrearages, the holders of such stock have waived their
right to elect directors until after December 31, 1995.
ELECTION OF DIRECTORS
NOMINEES FOR BOARD OF DIRECTORS
The Board has established the number of directors at 6. The 6 persons
named below have been nominated by the Board of Directors for election as
directors to serve until the next annual meeting and until their successors are
elected and qualified. The Board of Directors of the Corporation is not aware of
any other nominations for director to be made at the Annual Meeting.
It is the intention of the persons named in the enclosed proxy card to
vote such proxies for the election of the nominees named in this Proxy Statement
unless the proxies contain instructions to the contrary, in which case they will
be voted pursuant to such instructions. The Directors of the Corporation intend
to vote all shares beneficially owned by them for the nominees named herein.
Given that such Directors as a group beneficially own approximately 60.72
percent of the outstanding shares entitled to vote, such a vote would elect the
nominees notwithstanding the votes cast by other shareholders.
Each of the nominees for election to the Board of Directors is currently
a member of the Corporation's Board and of the Board of Directors of the
Corporation's subsidiary bank, First Independence National Bank of Detroit (the
"Bank"). If any nominee for any reason is unable or for good cause refuses to
serve or be elected, which is not anticipated, the persons named in the enclosed
form of proxy intend to vote for such other nominees, if any, as may be
recommended by the Board of Directors.
3
<PAGE> 7
The information below is presented as of April 14, 1995, and is based on
information provided by the persons named.
<TABLE>
<CAPTION>
Name and Principal Bank Shares of Common
Occupation or Employment Director Stock of Corporation Percent of
for Last Five Years (a) Since (b) Age Beneficially Owned (c) Common Stock
------------------------ --------- --- ---------------------- ------------
<S> <C> <C> <C> <C>
Don Davis (d) ........................... 1980 56 198,721(c) 59.01
Chairman of the Board of the
Corporation and of the Bank;
President, United Sound Systems,
Inc. and President, Conquistador/
Groovesville Music, Inc.,
record producers and recording
studios; President; Liberty Risk
Management, Inc., insurance
agency.
Dr. Charles E. Morton.................... 1969 69 700(c) *
Emeritus Pastor, Metropolitan Baptist
Church; Adjunct Professor of
Philosophy, Oakland University.
Richard W. Shealey....................... 1991 52 421(c) *
President and Chief Executive
Officer of the Bank (1991-
Present); President and Managing
Director, Sylvanus Corporation,
a privately-owned equipment
leasing and financial services
firm (1988-1991); President and
Chief Operating Officer,
Independence Bank of Chicago
(1984-1988).
Dennis H. Silber......................... 1980 55 2,124(c) *
Vice President and Chief Executive
Officer, Fred Silber Co., distributor
of merchandise for outdoor amusement
and promotional industries.
Gerald Van Wyke.......................... 1989 51 334 *
Attorney, Feikens, Vander Male, Stevens,
Bellamy & Gilchrist, P.C. (1994-present);
President, Covington Group, Inc.,
business consulting and merchant
banking company (1988-1994);
</TABLE>
4
<PAGE> 8
<TABLE>
<CAPTION>
Name and Principal Bank Shares of Common
Occupation or Employment Director Stock of Corporation Percent of
for Last Five Years (a) Since (b) Age Beneficially Owned (c) Common Stock
------------------------ --------- --- ---------------------- ------------
<S> <C> <C> <C> <C>
Eloise C. Whitten.................... 1983 65 334 *
Director, Michigan Department
of Social Services
All directors and officers
as a group (9 persons including 204,464 60.72
those named above)
</TABLE>
(a) Each of the persons named in the table currently is a director of the
Corporation and the Bank and is serving a term that will end at the
Annual Meeting or when a successor is elected and qualified.
(b) The Corporation was formed in 1986 and all directors have been
directors of the Corporation since its formation except those persons
for which a year after 1986 is shown.
(c) Each director possesses sole voting and investment power with respect
to the shares shown unless indicated otherwise below. The numbers of
shares shown for Mr. Don Davis and Mr. Richard Shealey include 3,845
and 87 shares, respectively, allocated to their accounts under the
First Independence Corporation Employee Stock Ownership Plan for which
each has only sole voting power. The number of shares shown for Dr.
Morton includes 300 shares held jointly with his wife in which they
share voting and investment power. The number of shares shown for Mr.
Silber include 1,790 shares owned jointly with his wife in which they
share voting and investment power.
*Less than one percent.
5
<PAGE> 9
EXECUTIVE OFFICERS
In addition to Messrs. Don Davis and Richard W. Shealey listed in the
table above, executive officers of the Corporation, as of December 31, 1994,
included Rose Ann Lacy, Senior Vice President and Chief Financial Officer of the
Corporation since 1989 and of the Bank since 1986 and John Boudreau, Senior Vice
President - Administration of the Bank since 1994. Prior to joining the Bank,
Mr. Boudreau was Financial Officer at Recoll Management Corporation, Boston, MA
(1991-1994); Chief Financial Officer and Treasurer (1991) and Controller
(1989-1991) of Coolidge Bank & Trust, Boston, MA.
EXECUTIVE COMPENSATION
The following table presents the cash compensation paid to the
Corporation's Chief Executive Officer during 1994. The Corporation and Bank
had no other executive officer who received total annual salary and bonus
exceeding $100,000 in 1993.
<TABLE>
<CAPTION>
Principal Relocation
Name Position Year Salary Bonus Allowance
- - ---- -------- ---- ------ ----- ----------
<S> <C> <C> <C> <C> <C>
Richard W. Shealey President and 1994 $119,000 - -
Chief Executive 1993 $95,000 - $25,000
Officer and 1992 $95,000 $15,000
Director of the
Corporation and
the Bank
</TABLE>
Richard W. Shealey has entered into a three year contract with the Bank
under which he will be paid a salary of $125,000 per year plus a car allowance
of $500 per month. The contract provides that, upon termination, he will
receive a severance payment of three (3) months' base compensation. The
contract provides for the creation and adoption by the Board of Directors of a
bonus plan, the terms of which are, as yet undetermined. In addition, the
contract provides that a stock option plan will be established pursuant to which
Mr. Shealey will be granted options to purchase shares of common stock equal to
a maximum of 10% of the outstanding common stock at the date of grant,
determined as if the option had been exercised on that date. The option price
will be $5.00 per share. According to an independent appraisal performed for
the Corporation's Employee Stock Ownership Plan as of December 31, 1993, the
fair market value of one share of Common Stock at that time was $4.45. The
Board will obtain appraisals of the stock from time to time unless an active
trading market develops in the stock. The options will be exercisable in whole
or in part for five years. The options will be issued pursuant to the proposed
1995 Stock Option Plan and will be Incentive Stock Options to the maximum extent
possible and non-qualified stock options for the remainder of the shares.
Fringe benefits and perquisites paid to Mr. Shealey in 1994 were less
than 10% of his total annual salary plus bonus.
The Corporation and the Bank do not presently have any long-term
incentive compensation plans, except the Corporation's Employee Stock Ownership
Plan which is described below and the proposed 1995 Employee Stock Option Plan.
The Corporation's Employee Stock Ownership Plan is qualified under
Section 401(a) of the Internal Revenue Code of 1986. All employees of the
Corporation and the Bank who have at least one year of service and who are at
least age twenty-one are eligible to participate. All shares of stock in the
plan are allocated to the accounts of the participants. Unvested shares
forfeited by terminated employees are reallocated among all Plan participants as
of the last day of the year of forfeiture in the proportion which each
participant's annual compensation bears to the total annual compensation of all
Plan participants. As of December 31, 1994, there were 3,845 shares allocated
under the Plan to Don Davis' account. 87 shares were allocated to Richard W.
Shealey on December 31, 1994. No
6
<PAGE> 10
contributions were made to the plan during 1994. Thus, there was no change in
the total shares held in the Plan.
Directors who were not officers were paid the following fees for Bank
Board of Directors and Committee meetings: a monthly stipend of $75; a meeting
fee of $180 for each Board meeting; and $100 for each Committee meeting. No
fees are paid for attendance at the Corporation's Board or Committee meetings.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The members of the Corporation's Board of Directors also serve as the
members of the Board of Directors for the Bank. The Committees described below
also function in a similar dual capacity.
The Audit Committee is composed of Dr. Charles E. Morton and Gerald Van
Wyke. The Audit Committee selects the Corporation's independent auditors,
reviews the results of prior audits and considers issues concerning the current
audit. The Committee also considers procedures for internal control and audits.
During 1994, the Committee held ten meetings.
The Executive Committee is composed of Richard W. Shealey, Gerald Van
Wyke, Don Davis, Dr. Charles Morton and Eloise Whitten. The Executive Committee
at times functions as a loan committee, reviewing loan applications and
delinquencies and approving loan applications. The Committee also functions in
lieu of the Corporation's and the Bank's Board between Board meetings. The
Executive Committee met seven times in 1994.
The Personnel/Internal Affairs Committee functions as a compensation and
nominating committee and is composed of Richard W. Shealey, Dennis H. Silber,
and Eloise C. Whitten. This Committee sets benefit policy and salary goals,
monitors salary expenses, recommends officer promotions and monitors the
conflict of interest policy. The Personnel/Internal Affairs Committee did not
meet in 1994. The Committee does not consider nominees for director recommended
by security holders of the Corporation.
The Compliance Committee monitors management's efforts pursuant to the
Formal Agreement entered into in April, 1991 between the Bank and the office of
the Comptroller of the Currency with respect to various supervisory matters. The
directors who were members of this Committee during 1994 are Don Davis, Dr.
Charles Morton, Richard W. Shealey, and Gerald Van Wyke. The Compliance
Committee met ten times in 1994.
In 1994, the Board of Directors of the Corporation met eleven times and
the Board of the Bank met eleven times. Each incumbent member of the Board
attended at least 75 percent of the total number of meetings held by the Boards
and Committees of which he or she was a member during 1994.
INTEREST IN CERTAIN TRANSACTIONS
In the ordinary course of its business, the Bank had during 1994, and
expects to have in the future, transactions with some of its directors and
officers, and their families and the companies with which they are associated.
All such transactions, which included commitments for loans and loans made by
the Bank, were based on terms, including rates, collateral and repayment terms,
substantially the same as those prevailing at the time for comparable
transactions with other persons, and in the opinion of the Board of Directors
and the management of the Bank such transactions did not and do not involve more
than the normal risk of collectability or present other unfavorable features.
During 1994 and 1993, the Bank paid consulting fees of approximately
$60,000 and $64,000 to Covington Group, Inc., a business consulting firm, for
advisory and legal services. Director Van Wyke is the President of Covington
Group, Inc. During 1993, the Bank paid insurance premiums of approximately
$5,700 to Liberty Risk Management, Inc., an insurance agency owned by Don
Davis, Chairman of the Board of the Corporation. The
7
<PAGE> 11
agency delivered the insurance premiums to the companies providing the
insurance. The insurance companies, as required by law, were responsible for
commissions due to Liberty Risk Management. No premiums were paid in 1994 to
Liberty Risk Management.
APPROVAL OF 1987 STOCK OPTION PLAN
GENERAL PROVISIONS; VOTE REQUIRED
On March 27, 1995, the Board of Directors approved the 1995 Stock Option
Plan (the "Plan") which is attached to this Proxy Statement as Exhibit A. The
Plan provides for the granting of options to purchase up to an aggregate of
67,352 shares of the Company's Common Stock to key salaried employees and
directors of the Company and its subsidiaries who are in a position to
contribute materially to the Company's continued growth and development and to
its long-term financial success. The Plan is intended to provide increased
incentives to such key employees.
Management of the Company believes that approval of the Plan is in the
best interests of the Company and its stockholders and therefore recommends that
the stockholders approve the plan. The affirmative vote of a majority of the
shares of Common Stock represented at the Meeting is necessary to approve the
Plan.
Options granted under the Plan may be incentive stock options within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), or options that do not meet the requirements of an incentive option
(referred to as "nonqualified options").
ADMINISTRATION AND ELIGIBILITY
The Board of Directors or a Stock Option Committee of the Board of
Directors composed of not fewer than two members of the Board who are not
employees (the "Committee") will administer and interpret the Plan and may from
time to time adopt such rules and regulations as they may determine
appropriate. Options may be awarded by the Committee, in its discretion, to
eligible key employees of the Company, its subsidiaries and affiliates as the
Committee may select. The Committee will determine from time to time, in its
discretion, whether options granted under the Plan will be incentive stock
options or nonqualified options.
GRANT, EXERCISE AND MODIFICATION OF OPTIONS
The option price for options granted under the Plan may not be less than
100% or, if the optionee of an incentive stock option grant is the beneficial
owner of more than 10% of the Company's Common Stock (a "10% stockholder"), less
than 110% of the fair market value of the Common Stock on the date of grant.
The appraised fair market value of the Common Stock on December 31, 1993,
determined for purposes under the Company's Employee Stock Ownership Plan since
there is not presently an active trading market for the Company's Common Stock
was $4.45 per share. Another appraisal of the Common Stock will be completed as
of December 31, 1994, and such dates as the Board determines. No optionee may
be granted incentive stock options that are first exercisable in any one
calendar year for shares of Common Stock that have been an aggregate fair market
value at the date of grant in excess of $100,000. There is no annual limit on
the value of shares for which nonqualified options may be granted or exercised,
except as may be set by the Committee.
Options granted under the Plan to key employees are exercisable at such
times as the Committee may determine, but no option may be exercisable after 10
years from the date it is granted; provided, however, that incentive stock
options granted to 10% stockholders may not be exercised after five years from
the date of grant. Shares subject to the unexercised portion of options that
lapse or terminate are available for the grant of new options under the Plan.
8
<PAGE> 12
Payment for shares to be acquired upon exercise of options granted under
the Plan may be made in cash or, at the discretion of the Committee, by
surrender of previously owned shares of the Company's Common Stock, which will
be valued for such purposes at the then fair market value of the Common Stock.
No option granted under the Plan is transferrable by the optionee other
than by will or the laws of descent and distribution. An option may be
exercised during an optionee's lifetime only by the optionee. Options may be
granted pursuant to the Plan within a period of 10 years from the date the Plan
was adopted by the Board of Directors.
An option shall be exercisable by key employees at such time or times as
the Committee may determine but not before one year after the date of grant.
Upon the death of an optionee, the option may be exercised by the optionee's
heirs within 12 months from the date of the optionee's death but only to the
extent that the option was exercisable by the optionee on the date of his
death. Unless different terms are established by the Committee, options will be
exercisable in annual installments of 33-1/3% of the total number of shares
subject to the option.
In the event the employment of an optionee is terminated by reason of
disability, the option, to the extent it was exercisable as of the date of
disability, may be exercised by the optionee at any time prior to the expiration
date of the option or within 12 months after the date of disability, whichever
period is shorter.
In the event an optionee's employment by the Company is terminated for
any reason other than because of death or disability the option, to the extent
it was exercisable as of the date of termination, may be exercised by the
optionee at any time prior to the expiration of the option, or within thirty
days after the optionee's termination of employment, whichever is shorter.
ADJUSTMENTS
In the event of any change in the outstanding shares of stock that
occurs after ratification of the Plan by stockholders by reason of a stock
dividend or split, recapitalization, merger, consolidation, combination,
exchange of shares or other similar corporate change, the aggregate number of
shares of stock subject to each outstanding option and its stated option price
shall be appropriately adjusted by the Committee whose determination shall be
conclusive. Fractional shares shall be rounded to the nearest whole share.
AMENDMENT OR TERMINATION
The Plan may be terminated or amended at any time by the Board of
Directors of the Company, but no amendment may, without the approval of
stockholders, (a) increase the total number of shares for which options may be
granted under the Plan, (b) change the class of employees eligible to receive
options, (c) change the provisions of the Plan regarding the option price except
with respect to permitted adjustments as described above, (d) extend the period
during which options may be granted, and (e) extend the maximum period after the
date of grant during which options may be exercised. No amendment, modification
or termination of the plan shall in any manner adversely affect any option
previously granted under the Plan without the consent of the optionee.
FEDERAL INCOME TAX CONSEQUENCES
Under the Code as now in effect, at the time an incentive stock option
is granted or exercised, the optionee will not be deemed to have received any
income, and the Company will not be entitled to any deduction. However, the
spread between the exercise price and the fair market value of the shares of
stock on the date of exercise is an item of tax preference, which may subject
the optionee to the alternative minimum tax. The holder of an incentive stock
option generally will be accorded long-term capital gain or loss treatment on
the disposition of common stock acquired by exercise of an incentive stock
option, provided the disposition occurs more than two years from the date the
option is granted and the stock acquired upon exercise of the option is held by
the optionee for more than one year. An optionee who disposes of shares
acquired upon exercise of an incentive stock option prior to the expiration
9
<PAGE> 13
of the foregoing holding periods, realizes ordinary income upon the
disposition. To the extent ordinary income is recognized by the optionee, the
Company may deduct such amount as compensation. The Company will not recognize
a gain or loss from the transfer of Common stock when an option is exercised.
Upon the exercise of an option that is not an incentive stock option,
the optionee will realize ordinary income equal to the difference between the
option price and the fair market value of the Common Stock at the time of
exercise. (However, payment of the option price for shares of Common Stock by
surrender of previously owned shares of Common Stock owned by the optionee will
not give rise to a recognized gain on the shares surrendered.) The Company will
be entitled to a deduction for federal income tax purposes for an amount equal
to the income taxable to the employee. When the optionee disposes of the shares
acquired by the exercise of the option, any amount received in excess of the
fair market value of the shares on the date of exercise will be treated as long-
or short-term capital gain, depending upon the holding period of the shares.
INDEPENDENT AUDITORS
As for the past several years, Coopers & Lybrand has been selected to
serve the Corporation as independent auditors for 1995. A representative of
that firm is expected to be present at the meeting, will have the opportunity to
make a statement if he desires to do so, and will be available to respond to
appropriate questions.
PROPOSALS BY SHAREHOLDERS
Proposals by shareholders of the Corporation intended to be presented at
the next annual shareholders' meeting to be held in 1996 must be received by the
Corporation no later than January 31, 1996. Proposals must comply with
applicable laws and regulations and shall be delivered to 44 Michigan Avenue,
Detroit, Michigan 48226, Attention: Secretary. Any proposal which is mailed to
the Corporation should be mailed by certified or registered mail return receipt
requested.
OTHER MATTERS
The Corporation's management knows of no other matters to be presented
for action at the meeting. It is the intention of the persons named in the
accompanying form of proxy to vote the shares represented thereby in accordance
with the directions of management on any matters properly brought before the
meeting which are not set forth in the Notice of the Meeting and in this Proxy
Statement.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors and certain officers, and persons who own more than ten
percent of the Corporation's Common Stock to file with the SEC initial reports
of beneficial ownership and reports of changes in beneficial ownership of the
Corporation's equity securities. These officers, directors and greater than
ten-percent shareholders are required by SEC regulation to furnish the
Corporation with copies of these reports.
To the Corporation's knowledge, based solely on review of the copies of
such reports furnished to the Corporation and written representations that no
other reports were required, all Section 16(a) filing requirements applicable to
its officers, directors, and greater than ten-percent beneficial owners were
complied with.
SHAREHOLDERS ARE URGED TO DATE AND SIGN THE ENCLOSED
PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED
POSTAGE PAID ENVELOPE.
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EXHIBIT A
1995 EMPLOYEE STOCK OPTION PLAN
OF FIRST INDEPENDENCE CORPORATION
1. PURPOSE. The purpose of the 1995 Employee Stock Option
Plan of First Independence Corporation (the "Plan") is to promote the best
interests of First Independence Corporation (the "Company") and its
stockholders by encouraging participants to acquire a proprietary interest in
the Company, thus identifying their interests with those of its stockholders
and encouraging the participants to make greater efforts on behalf of the
Company and its subsidiaries.
2. CERTAIN DEFINITIONS. This Plan includes employees and
directors of First Independence National Bank of Detroit, a subsidiary of the
Company, as well as other subsidiaries of the Company or of the Bank, whether
now in existence or later established or acquired. The term "subsidiary" of
the Company means any "subsidiary corporation" as defined in Section 424(f) of
the Internal Revenue Code of 1986, as amended (the "Code"), the term "employee"
means an individual with an "employment relationship" with the Company, parent
or any subsidiary as defined in Regulation 1.421-7(h) of the Income Tax
Regulations, and the term "employment" means employment with the Company, or
any subsidiary of the Company.
3. ADMINISTRATION. The Plan shall be administered by the
Board of Directors or by a Stock Option Committee of the Board of Directors of
the Company composed of not fewer than two members (the "Committee"), provided
that no director who is an employee shall participate in administration of the
Plan as a member of the Board of Directors or as a member of the Committee. No
member of the Committee shall be eligible to receive stock options under the
Plan or under any other similar plan of the Company, its parent or a subsidiary
of the Company, while serving on the Committee except by (i) participation
under a formula plan which meets the conditions of SEC Rule 16b-3(c)(2)(ii),
the formula plan set forth in 6(b) below, or (ii) participation in a thrift,
stock purchase, or similar ongoing securities acquisition plan which meets the
requirements of SEC Rule 16b-3(d)(3)(i), or (iii) an election to receive an
annual retainer fee in either cash or an equivalent amount of securities, or
partly in each. The Committee shall interpret the Plan, prescribe, amend, and
rescind rules and regulations relating to the Plan, and make all other
determinations necessary or advisable for its administration. The decision of
the Committee on any question concerning the interpretation of the Plan or any
option granted under the Plan shall be final and binding upon all participants.
4. PARTICIPANTS. Participants in the Plan shall be such key
salaried employees (including employees who are directors) and directors of the
Company or of any of its subsidiaries as the Committee may select from time to
time. The Committee may grant options to an individual upon the condition that
the individual become an employee of the Company, or any subsidiary, provided
that the option shall be deemed to be granted only on the date the individual
becomes an employee.
5. STOCK. The stock subject to options under the Plan shall
be the Common Stock of the Company, par value $1.00 per share ("Common Stock"),
and may be either authorized and unissued shares or shares reacquired by the
Company. The total amount of Common Stock on which options may be granted
under the Plan shall not exceed (84,180) (67,352) shares, subject to adjustment
in accordance with Section 13. Shares subject to any unexercised portion of a
terminated or expired option granted under the Plan may again be subjected to
options under the Plan.
6. AWARD OF OPTIONS.
(a) The Committee, at any time and from time to time,
subject to Section 15, may grant
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<PAGE> 15
options to such participants and for such number of shares of Common Stock as
it shall designate. The Committee may designate any option granted as either
an Incentive Stock Option or a Nonqualified Stock Option, or the Committee may
designate a portion of an option as an Incentive Stock Option or a Nonqualified
Stock Option. An Incentive Stock Option is an option intended to meet the
requirements of Section 422 of the Code. A Nonqualified Stock Option is an
option granted under the Plan other than an Incentive Stock Option. Each
option granted under the Plan shall meet all of the terms and conditions of the
Plan, except that only an Incentive Stock Option shall be required to comply
with the additional requirements of Section 7. Any participant may hold more
than one option under the Plan and any other stock option plan of the Company.
The date on which an option is granted shall be the date of the Committee's
authorization of the option or such later date as shall be determined by the
Committee at the time the option is authorized. Each option shall be evidenced
by a stock option agreement (the "Agreement") in such form and containing such
provisions not inconsistent with the Plan as the Committee shall approve.
(b) Notwithstanding paragraph (a) of this section, each
director who is not an employee and who has served as a director for at least
five consecutive years before the adoption of this Plan, shall be granted an
option to purchase _____ shares of Common Stock.
7. INCENTIVE STOCK OPTIONS. Any option intended to
constitute an Incentive Stock Option shall comply with the following
requirements: (a) No Incentive Stock Option shall be granted to any
participant who owns (within the meaning of Section 424(d) of the Code) stock
of the Company, or its subsidiaries, possessing more than 10% of the total
combined voting power of all classes of stock of the Company, or its
subsidiaries, unless, at the date of grant of an option to such a participant,
the exercise price for the option is at least 110% of the fair market value of
the shares subject to option and the option, by its terms, is not exercisable
more than five years after the date of grant; (b) the aggregate fair market
value of the underlying Common Stock (determined as of the time the options are
granted) as to which Incentive Stock Options under the Plan may first be
exercised by any one participant in any one calendar year shall not exceed
$100,000; and (c) the option price shall be the greater of (i) the fair market
value per share of Common Stock on the date the option is granted or (ii) the
book value per share of Common Stock.
8. OPTION PRICE.
(a) The Committee shall determine the option price per
share for each option granted under the Plan.
(b) Notwithstanding paragraph (a) of this section, the
option price per share for each option granted to persons who are directors but
not employees shall be as set forth in Section 7(c) above.
9. TERMS AND CONDITIONS OF EXERCISE. No option granted
under the Plan shall be exercised prior to one year from the date of grant.
Unless additional or different terms and conditions are from time to time
established and authorized by the Committee with respect to the exercise of any
option or options granted hereunder, an option may be exercised in annual
installments of 33-1/3% of the total number of shares subject to the option,
and shall be fully exercisable after three years. To the extent not exercised,
installments shall be cumulative and may be exercised in whole or in part. The
Committee, in its discretion, may accelerate the right to exercise an option.
No option shall be exercisable after the tenth anniversary of the date
of grant or such lesser period as the Committee may specify from time to time.
10. PAYMENT FOR SHARES. The purchase price for shares of
Common Stock to be acquired upon exercise of an option granted hereunder shall
be paid in full in cash or by certified check, bank draft or money order at the
time of exercise; provided, however, that in lieu of such form of payment a
participant may, with the approval of the Committee or if permitted under the
terms of the Agreement relating to such option, pay such purchase price
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<PAGE> 16
in whole or in part by tendering to the Company shares of Common Stock of the
Company then owned by the optionee, which shares shall be valued at their fair
market value as of the date of such exercise and payment.
11. NON-ASSIGNABILITY. No option shall be transferable by a
participant except by will or the laws of descent and distribution. During the
lifetime of a participant, an option shall be exercised only by the optionee.
No transfer of an option by will or by the laws of descent and distribution
shall be effective to bind the Company unless the Company shall have been
furnished with written notice thereof and a copy of the will or such evidence
as the Company may deem necessary to establish the validity of the transfer and
the acceptance by the transferee of the terms and conditions of the option.
12. EFFECT OF TERMINATION OF EMPLOYMENT OR DEATH. If, prior
to the date that any option shall first become exercisable, the participant's
employment shall be terminated, with or without cause, or by the act, death,
permanent disability, or retirement of the participant, the participant's right
to exercise the option shall terminate and all rights thereunder shall cease.
If, on or after the date that any option shall first become exercisable,
a participant's employment shall be terminated for any reason other than death
or disability (within the meaning of Section 22(e)(3) of the Code), the
participant shall have the right, within thirty days after such termination of
employment, to exercise the option to the extent that it shall have been
exercisable and is unexercised on the date of such termination of employment,
subject to any other limitation on the exercise of the option in effect at the
date of exercise.
The transfer of an employee from one corporation to another among the
Company, and any of its subsidiaries, or a leave of absence with the written
consent of the Company, shall not be a termination of employment for purposes of
the Plan.
If an option shall have become exercisable during a participant's term
of employment and the participant shall die or become disabled (within the
meaning of Section 22(e)(3) of the Code) while in the employ of the Company or
within one month after termination of employment with the Company, the
participant or the executor or administrator of the estate of the participant
(as the case may be), or the person or persons to whom the option shall have
been transferred by will or by the laws of descent and distribution, shall have
the right, within three months from the date of the participant's death, or the
date of the participant's termination of employment due to disability, to
exercise the option to the extent that it was exercisable and unexercised on the
date of termination of employment or disability, subject to any other limitation
on exercise in effect at the date of exercise.
13. STOCK DIVIDEND, RECLASSIFICATION, MERGER, ETC. The total
amount of Common Stock on which options may be granted under the Plan, and the
number of shares subject to any option granted to a participant (both as to the
number of shares of Common Stock and the option price), shall be appropriately
adjusted for any increase or decrease in the number of outstanding shares of
Common Stock resulting from payment of a stock dividend on Common Stock, a
subdivision or combination of shares of Common Stock, or a reclassification of
Common Stock, and (in accordance with the provisions contained in the next
following paragraph) in the event of a merger in which the Company shall be the
surviving corporation.
After any merger of one or more corporations into the Company (except in
the event of a reverse triangular merger in which the Company is the surviving
corporation), each participant shall, at no additional cost, be entitled, upon
any exercise of the participant's option to receive (subject to any required
action by stockholders), in lieu of the number of shares as to which the option
shall then be so exercised, the number and class of shares of stock or other
securities to which the participant would have been entitled pursuant to the
terms of the agreement of merger if at the time of such merger the participant
had been a holder of record of a number of shares of Common Stock equal to the
number of shares as to which the option shall then be so exercised. Comparable
rights shall accrue to each participant in the event of successive mergers of
the character described above.
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<PAGE> 17
The foregoing adjustments, and their application to particular
circumstances, shall be determined by the Committee in its sole discretion. Any
such adjustment may provide for the elimination of any fractional share which
might otherwise become subject to an option.
If the Company is not the surviving corporation in the event of a
merger, or if the Company is the surviving corporation in a reverse triangular
merger, or if the Company is a party to a consolidation, or if the Company
transfers substantially all of its assets and liquidates, then, as determined by
the Committee, either (i) unexercised options outstanding under the Plan shall
be cancelled as of the effective date of the merger, consolidation or sale;
notice of cancellation shall be given to each participant to whom an option has
been granted; and the participant shall be permitted to exercise such option in
full preceding the effective date of the merger, consolidation, or sale; or,
(ii) the Committee may make appropriate arrangements for the substitution of a
new option for the participant's option or an assumption of the participant's
option in a transaction meeting the requirements of Section 424(a) of the Code,
under terms which provide equivalent value to the participant, as determined by
the Committee in its sole discretion.
14. RIGHTS PRIOR TO ISSUANCE OF SHARES. No participant shall
have any rights as a stockholder with respect to any shares covered by an
option until the issuance of a stock certificate to the participant for such
shares. No adjustment shall be made for dividends or other rights with respect
to such shares for which the record date is prior to the date such certificate
is issued.
15. TERMINATION AND AMENDMENT. The Board of Directors (the
"Board") may terminate the Plan, or the granting of options under the Plan, at
any time. No option shall be granted under the Plan 10 years after adoption of
the Plan by the Board of Directors or approval of the Plan by stockholders,
whichever is earlier. Termination of the Plan shall not affect the rights of
the holders of any options previously granted and then outstanding.
The Board may amend or modify the Plan at any time and from time to
time, but no amendment or modification, without the approval of the stockholders
of the Company, shall (a) increase the amount of Common Stock as to which
options may be granted, except as permitted under Section 13; (b) change the
minimum option price; or (c) change the provisions relating to the eligibility
of employees or directors to whom options may be granted.
No amendment, modification, or termination of the Plan shall in any
manner affect any option granted under the Plan without the consent of the
participant holding the option.
16. APPROVAL OF PLAN. The Plan shall be subject to the
approval of the holders of at least a majority of the Common Stock of the
Company present and entitled to vote at a meeting of stockholders of the
Company held within 12 months after adoption of the Plan by the Board. No
option granted under the Plan may be exercised in whole or in part until the
Plan has been approved by the stockholders as provided herein. If not approved
by stockholders within such 12-month period, the Plan and any options granted
hereunder shall become void and of no effect.
17. EFFECT ON EMPLOYMENT. Neither the adoption of the Plan
nor the granting of any option pursuant to it shall be deemed to create any
right in any individual to be retained or continued in the employment of the
Company or any of its subsidiaries.
18. USE OF PROCEEDS. The proceeds received from the sale of
Common Stock pursuant to the Plan will be used for general corporate purposes
of the Company.
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FIRST INDEPENDENCE CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL SHAREHOLDERS' MEETING, TUESDAY, MAY 23, 1995
I, the undersigned shareholder of the First Independence Corporation,
hereby appoint Don Davis, Richard W. Shealey and Dr. Charles E. Morton, and
each of them, my proxies, with power of substitution to vote all of the Common
Stock of said Corporation standing in my name on its books on April 14, 1995,
at the annual meeting of the shareholders to be held on Tuesday, May 23, 1995
at 6:00 p.m. or at any and all adjournments thereof, on the proposals contained
in the Notice of said meeting, and on any other business properly coming before
the meeting. The proxyholders shall have all the powers I would possess if
present personally. I revoke all proxies previously given by me for any
meeting of shareholders of the Corporation.
<TABLE>
<S> <C> <C>
1. ELECTION OF [ ] FOR the nominees listed below [ ] WITHHOLD AUTHORITY
DIRECTORS (except as indicated to the contrary below) to vote for the nominees listed below
DON DAVIS, DR. CHARLES E. MORTON, RICHARD W. SHEALEY, DENNIS H. SILBER, GERALD VAN WYKE, ELOISE C. WHITTEN.
(INSTRUCTION: To withhold authority to vote for any individual nominee write that nominee's name on the space provided below.)
</TABLE>
2. Authorize 1995 Stock Option Plan [ ] FOR [ ] AGAINST
If no direction is made with respect to a proposal, this proxy will be voted
FOR such proposal. In their discretion, the proxies are authorized to vote
on such other matters as may properly come before the meeting, including the
election of any person as Director where a nominee named in the Proxy
Statement dated April 18, 1995 is unable to serve or will not serve.
I (we) acknowledge receipt of the Notice of Annual Meeting and Proxy
Statement dated April 18, 1995 and ratify all that the proxies or either of
them or their substitutes may lawfully do by virtue hereof and revoke all
former proxies.
(continued and to be signed on the other side)
Account Number No. of Shares Proxy No.
UNLESS OTHERWISE SPECIFIED, THE PROXIES ARE APPOINTED TO VOTE FOR THE ELECTION
OF ALL DIRECTORS AND TO VOTE FOR AUTHORIZATION OF THE CLASS C PREFERRED STOCK
AND FOR THE INCREASE IN AUTHORIZED COMMON STOCK AND ISSUANCE THEREOF WITH OR
WITHOUT VOTING RIGHTS.
Please date, sign and return this proxy in the enclosed envelope.
__________________ Date:_________
(Signature)
__________________ Date:_________
(Signature)
Note: Please sign exactly as
name(s) appear(s) on stock
records. When signing as
attorney, administrator,
trustee, guardian or corporate
officer, please so indicate.
