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:
[ ] 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 Rule 14a-11(c) or Rule 14a-12.
Meridian Insurance Group, Inc.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
____ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(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>
MERIDIAN INSURANCE GROUP, INC.
Notice of Annual Meeting of Shareholders to be held May 10, 2000
The Annual Meeting of Shareholders of Meridian Insurance Group, Inc.,
will be held on May 10, 2000, at 2:00 p.m., Eastern Standard Time, in our home
office at 2955 North Meridian Street, Indianapolis, Indiana, in the Pennsylvania
North Room. The purpose of the meeting is to:
1. elect three directors; and
2. act on any other business properly coming before the meeting.
The Annual Meeting will be held solely to tabulate the votes cast and
to report the results of voting on the matters listed in this Proxy Statement.
There will be no other business transacted.
Shareholders of record at the close of business on March 10, 2000, will
be entitled to notice of and to vote at the Annual Meeting.
This Proxy Statement, proxy card and Meridian's 1999 Annual Report to
Shareholders are being distributed on or about April 3, 2000.
By order of the Board of Directors,
/s/ Norma Oman
Norma J. Oman
President and
Chief Executive Officer
April 3, 2000
Indianapolis, Indiana
<PAGE>
MERIDIAN INSURANCE GROUP, INC.
2955 North Meridian Street
P.O. Box 1980
Indianapolis, Indiana 46206
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
May 10, 2000
Meridian Insurance Group, Inc., ("MIGI" or the "Company" or "we") will
hold our Annual Meeting of Shareholders on May 10, 2000, at 2:00 p.m., Eastern
Standard Time. The meeting will be in our home office at 2955 North Meridian
Street, Indianapolis, Indiana, in the Pennsylvania North Room. The meeting will
be held solely to report the results of voting on those matters listed in this
Proxy Statement. We have not planned any other business matters or
presentations. Following the meeting, we will mail to each shareholder a written
report of the voting results.
Our Board of Directors is mailing you this Proxy Statement and the
enclosed proxy card. Our purpose is to solicit your proxy to be voted at the
Annual Meeting and at any adjournment of it. Below is important information
about the Annual Meeting and this Proxy Statement.
What you are voting on:
o the election of three directors: Joseph D. Barnette, Jr., Ramon
L. Humke, and Thomas H. Sams
Who may vote: Shareholders as of the close of business on March 10,
2000, (the "Record Date") are entitled to vote at the Annual Meeting. Each
shareholder is entitled to one vote for each Common Share held on the Record
Date.
How to vote: MIGI shareholders on the Record Date may vote in person at
the Annual Meeting or by proxy. We recommend you vote by proxy even if you plan
to attend the Annual Meeting. You can always change your vote at the Annual
Meeting.
How proxies work: MIGI's Board of Directors is asking for your proxy.
Giving us your proxy means you authorize us to vote your shares at the Annual
Meeting in the manner you direct. You may vote for all, some or none of our
director nominees. To vote by proxy, please mark your vote on the enclosed proxy
card, sign and date it, and return it in the prepaid envelope. If you return
your signed proxy but do not specify how to vote, we will vote your shares in
favor of our director nominees.
How to revoke your proxy: You have the right to revoke your proxy any
time before the meeting by notifying MIGI's Corporate Secretary in writing or
returning a later-dated proxy. You may also revoke your proxy by voting in
person at the Annual Meeting.
If you receive more than one proxy card: It means you hold shares
registered in more than one account. Sign and return all proxies to ensure that
all your Common Shares are voted.
<PAGE>
A quorum: In order to carry on the business of the Annual Meeting, we
must have a quorum. This means at least a majority of the outstanding Common
Shares eligible to vote must be represented at the Meeting, either by proxy or
in person. As of the Record Date, 7,925,666 MIGI Common Shares were issued and
outstanding. Any properly executed proxy cards we receive will be considered
part of the quorum, including abstentions and broker non-votes. Broker non-votes
occur when a broker returns a proxy card but does not have authority to vote on
a particular proposal.
Votes needed: The three director nominees receiving the most votes will
be elected to the Board of Directors. Only votes cast for a nominee will be
counted, except that your proxy will be voted for the three management nominees
unless it contains instructions to the contrary. Abstentions, broker non-votes
and instructions on your proxy card to withhold authority to vote for one or
more of the nominees will result in their receiving fewer votes. However, such
action will not reduce the number of votes the nominee receives otherwise. As of
the Record Date, Meridian Mutual Insurance Company ("Meridian Mutual") owned
3,811,500 Common Shares or approximately 48.1 percent of MIGI's outstanding
Common Shares. Meridian Mutual has advised MIGI it will vote its shares in favor
of the election of Messrs. Barnette, Humke, and Sams.
Shareholder recommendations for directors: Any shareholder may
recommend a person as a candidate for director of MIGI by writing to MIGI's
Corporate Secretary at P. O. Box 1980, Indianapolis, Indiana 46206. The
shareholder should include the candidate's name, qualifications, and employment
history. The candidate must be qualified and expressly interested in serving on
the Board.
Shareholder proposals for the 2001 Annual Meeting: Shareholder
proposals for next year's Annual Meeting must be received by us by December 3,
2000. The proposals must be in writing and addressed to MIGI's Corporate
Secretary at P.O. Box 1980, Indianapolis, Indiana 46206. We will include a
proposal in next year's proxy statement if it:
o complies with Securities and Exchange Commission regulations and
o represents a proper subject for shareholder action under Indiana law.
BENEFICIAL OWNERSHIP OF COMMON SHARES
The following table lists, as of March 10, 2000, the number and
percentage of MIGI's outstanding Common Shares beneficially owned by:
o each director of MIGI
o each Named Executive Officer in the Summary Compensation Table
o all directors and executive officers of MIGI as a group, and
o each person known by MIGI to own beneficially more than five percent
of its Common Shares.
Each person has sole voting and sole investment power with respect to the Common
Shares they own, unless a footnote states otherwise.
Percent of
Name of Individual Shares Beneficially Outstanding
or Identity of Group Owned Common Shares
----------------------- -------------------- --------------
Principal Shareholder:
- ----------------------
Meridian Mutual Insurance Co. 3,811,500 48.1%
2955 N. Meridian Street
P.O. Box 1980
Indianapolis, Indiana 46206
<PAGE>
Gregory M. Shepard 1,588,400 (1) 20.04%
15 Country Club Place
Bloomington, Illinois 61701
Franklin Resources, Inc. 446,120 (2) 5.63%
Charles B. Johnson
Rupert H. Johnson, Jr.
777 Mariners Island Blvd.
San Mateo, California 94404
Franklin Advisory Services, LLC.
One Parker Plaza, 16th Floor
Ft. Lee, New Jersey 07024
Directors and Officers:
- -----------------------
Ramon L. Humke 23,129 (3) *
Norma J. Oman 180,727 (4) 2.24%
Sarah W. Rowland 7,738 (3) *
Joseph D. Barnette, Jr. 13,304 (3) (5) *
David M. Kirr 13,304 (3) *
John T. Hackett 11,039 (3) *
James D. Price 23,553 (3) (6) *
Thomas H. Sams 8,108 (7) (8) *
Steven R. Hazelbaker 43,091 (9) *
J. Mark McKinzie 20,176 *
Timothy J. Hanrahan 40,240 (10) *
Carl W. Buedel 46,492 (11) *
All directors and executive 430,901 (12) 5.25%
officers as a group (12 persons)
*The asterisk means this person beneficially owns less than one percent of
MIGI's outstanding Common Shares.
(1) This number is based upon a copy of a Schedule 13D filed by Gregory M.
Shepard with the Securities and Exchange Commission on November 3, 1999, and a
copy of a subsequent beneficial ownership report filed by Mr. Shepard under
Section 16(a) of the Exchange Act, with regard to 1,444,000 MIGI Common Shares.
We have adjusted the share number to 1,588,400 to reflect the ten percent MIGI
stock dividend distributed in January 2000.
(2) Franklin Advisory Services, LLC., Franklin Resources, Inc., Charles B.
Johnson, and Rupert H. Johnson, Jr., filed a Schedule 13G with the Securities
and Exchange Commission in January 2000, reporting beneficial ownership of
446,120 Common Shares of MIGI. The Schedule 13G states that those Common Shares
are beneficially owned by one or more open or closed-end investment companies or
other managed accounts which are advised by direct and indirect investment
advisory subsidiaries ("Adviser Subsidiaries") of Franklin Resources, Inc.
("FRI"). The advisory contracts grant to the Adviser Subsidiaries all investment
and/or voting power over the securities owned by the advisory clients.
Therefore, such Adviser Subsidiaries may be deemed to be, for purposes of Rule
13d-3 under the Securities Exchange Act of 1934, beneficial owner of the Common
Shares covered by the Schedule 13G filing. Charles B. Johnson and Rupert H.
Johnson, Jr. ("Principal Shareholders") each own in excess of 10 percent of the
outstanding common stock of FRI and are the principal shareholders of FRI. FRI
and the Principal Shareholders may be deemed to be, for purposes of Rule 13d-3
under the 1934 Act, the beneficial owner of securities held by persons and
entities advised by FRI subsidiaries. FRI, the Principal Shareholders, and each
of the Adviser Subsidiaries disclaim any economic interest or beneficial
ownership in any of the securities covered by the Schedule 13G filing.
<PAGE>
(3) This number includes options to purchase 6,050 Common Shares granted under
MIGI's 1994 Outside Director Stock Option Plan.
(4) This number includes 141,814 Common Shares Ms. Oman has the option to
purchase under MIGI's Incentive Stock Plan.
(5) This number includes 2,420 Common Shares held by Mr. Barnette's spouse. Mr.
Barnette shares voting and dispositive power for this stock.
(6) This number includes 2,420 Common Shares held by Mr. Price's spouse.
(7) This number includes 1,210 Common Shares owned by Waldemar Industries, Inc.
Mr. Sams is the principal owner of Waldemar Industries, Inc.
(8) This number includes options to purchase 4,840 Common Shares granted under
MIGI's 1994 Outside Director Stock Option Plan.
(9) This number includes 40,793 Common Shares Mr. Hazelbaker has the option to
purchase under MIGI's Incentive Stock Plan and 935 Common Shares held by
the MIGI 401(k) Plan.
(10) This number includes 24,261 Common Shares Mr. Hanrahan has the option to
purchase under MIGI's Incentive Stock Plan and 453 Common Shares held by
the MIGI 401(k) Plan.
(11) This number includes 28,561 Common Shares Mr. Buedel has the option to
purchase under MIGI's Incentive Stock Plan.
(12) This number includes 276,569 Common Shares subject to options to purchase
under MIGI's Incentive Stock Plan or MIGI's 1994 Outside Director Stock
Option Plan. Common Shares directly owned by Meridian Mutual are not
included in this number.
<PAGE>
ELECTION OF DIRECTORS
The Board of Directors consists of eight directors divided into three
classes. Directors generally serve for terms of three years, but at the
discretion of the Board, terms may be for one or two years. The term of one
class of directors expires at each Annual Meeting of Shareholders. According to
MIGI policy, at least two members of the Board of Directors will not otherwise
be affiliated with MIGI or Meridian Mutual.
Nominees for election this year are: Mr. Joseph D. Barnette, Jr., and
Mr. Thomas H. Sams for three-year terms and Mr. Ramon L. Humke for a one-year
term. All the nominees currently serve as MIGI directors. The other directors
listed in the following table have terms of office expiring in 2001 or 2002.
Each nominee has consented to serve for an additional term. If a
nominee becomes unavailable before the election, your proxy card authorizes us
to vote for a replacement nominee if the Board names one.
Name Age Capacity
- ---- --- --------
Nominee for election as director
with term expiring in 2001:
Ramon L. Humke 67 Director
Nominees for election as director
with terms expiring in 2003:
Joseph D. Barnette, Jr. 60 Director
Thomas H. Sams 58 Director
Directors continuing in office
with terms expiring in 2002:
James D. Price 61 Director
Sarah W. Rowland 67 Director
Directors continuing in office
with terms expiring in 2001:
Norma J. Oman 52 President, Chief Executive Officer
and Director
David M. Kirr 62 Director
John T. Hackett 67 Director
<PAGE>
Mr. Barnette has served as a director of the Company since 1988. Mr.
Barnette is the Chief Executive Officer and Chairman of the Board of Bank One,
Indiana, NA. He also serves as a director of Indianapolis Power and Light
Company and IPALCO Enterprises, Inc.
Mr. Humke has served as a director of MIGI since 1987 and as Chairman
since 1992. He is also Chairman of the Board of Directors of Meridian Mutual.
Mr. Humke has been the President, Chief Operating Officer and a director of
Indianapolis Power and Light Company since 1990. Mr. Humke is also a director of
IPALCO Enterprises, Inc.
Mr. Sams has served as a MIGI director since 1994. Mr. Sams has been
President, Chief Executive Officer, principal owner, and a director of Waldemar
Industries, Inc., an investment holding company in Indianapolis, Indiana, since
1967. He is also a director of Indianapolis Power and Light Company, IPALCO
Enterprises, Inc., and Mid-America Capital Resource, Inc.
Ms. Oman has been President, Chief Executive Officer, and a director of
MIGI since 1991. She has served as President, Chief Executive Officer, and a
director of Meridian Mutual and Meridian Security Insurance Company ("Meridian
Security") since 1990. She is also a director of Lilly Industries, Inc.
Mr. Kirr has served as a MIGI director since 1992. Mr. Kirr has been
the President of Kirr, Marbach & Company, a Columbus, Indiana, investment
advisory firm, since 1975.
Mr. Hackett has served as a director of the Company since 1992. Mr.
Hackett has been a Managing General Partner of CID Equity Partners, L.P., a
venture capital firm, since 1991. Mr. Hackett also serves as a director of
Meridian Mutual, Ball Corporation, Irwin Financial Corporation, Waterlink, Inc.,
and Wabash National Corporation.
Mr. Price has been a MIGI director since 1998 and a Meridian Mutual
director since 1987. Mr. Price is a First Vice President - Investments for
Prudential Securities Incorporated.
Ms. Rowland has served as a director of the Company since 1994. Ms.
Rowland was Chief Executive Officer of Rowland Design, Inc., an Indianapolis,
Indiana, interior design and space planning firm, from 1993 to 1999, and she has
been chairman of its board of directors since 1993. She also is a director of
Meridian Mutual, Indianapolis Power and Light Company and IPALCO Enterprises,
Inc.
COMMITTEES OF THE BOARD OF DIRECTORS
During 1999 the Board of Directors held six meetings. Each director
attended at least 75 percent of the aggregate of the total number of Board
meetings and the total number of meetings of all Board committees on which the
director served. MIGI's Board of Directors has six committees. They normally
hold joint meetings with similar committees of the Meridian Mutual Board of
Directors.
<PAGE>
Audit Committee
Members: Directors Barnette, Hackett, Humke and Price
Number of Meetings in 1999: Four
Functions: o Reviews accounting and financial reporting functions
o Oversees internal controls, audits and compliance
program
o Recommends independent auditors and oversees their
activities
o Monitors the parties' relationships under the
Reinsurance Pooling Agreement
<PAGE>
Compensation Committee
Members: Directors Humke and Sams
Number of Meetings in 1999: Two
Functions: o Establishes and administers executive compensation
program and any incentive compensation plans
o Reviews salary and employee benefit programs
o Administers 1996 Employee Incentive Stock Plan
Finance and Investment Committee
Members: Directors Barnette, Hackett, Humke, Kirr, Oman and Price
Number of Meetings in 1999: Four
Functions: o Establishes investment policy and guidelines
o Reviews and approves Company investment transactions
Nominating Committee
Members: Directors Humke, Oman and Rowland
Number of Meetings in 1999: None
Functions: o Considers and recommends candidates for membership on
the Board of Directors
o Will consider a candidate for director recommended by a
shareholder
Business Development Committee
Members: Directors Rowland, Humke, Oman, and Price
Number of Meetings in 1999: Two
Functions: o Reviews management proposals for product and service
developments and enhancements
o Assists and guides management with strategic business
initiatives
Pooling Agreement Committee
Members: Directors Barnette, Hackett, Humke, Kirr, and Oman
Number of Meetings in 1999: None
Functions: o At request of Audit Committee and in conjunction with
Meridian Mutual's Pooling Agreement Committee,
reviews relationships among the parties to the
Reinsurance Pooling Agreement and determines whether
the percentage participation of the parties continues
to bear an appropriate relationship
<PAGE>
CERTAIN RELATIONSHIPS AND TRANSACTIONS
Meridian Mutual incorporated MIGI in 1986. MIGI remained a wholly-owned
subsidiary of Meridian Mutual until March 1987. At that time, MIGI sold
1,700,000 Common Shares in a public offering. This reduced Meridian Mutual's
ownership of MIGI's outstanding Common Shares from 100 percent to approximately
65 percent. MIGI completed a second public offering of 1,725,000 Common Shares
in 1993. This further reduced Meridian Mutual's ownership of MIGI to
approximately 46.8 percent of its Common Shares. In mid-1996, the Company
acquired Citizens Security Group, Inc., and its property and casualty insurance
subsidiaries, Meridian Citizens Security Insurance Company ("MC Security"),
formerly Citizens Fund Insurance Company, and Insurance Company of Ohio ("ICO")
and became affiliated with Meridian Citizens Mutual Insurance Company ("MC
Mutual"), formerly Citizens Security Mutual Insurance Company. References in
this Proxy Statement to "Meridian Citizens Group" include MC Security, ICO and
MC Mutual.
MIGI markets insurance products and services through its wholly-owned
subsidiaries, Meridian Security and MC Security. Their operations are
interrelated with the operations of MC Mutual and Meridian Mutual, an Indiana
mutual property and casualty company. MIGI believes its various transactions
with Meridian Mutual and MC Mutual are on terms no less favorable to MIGI than
what could be negotiated with an independent third party.
MIGI obtains the majority of its insurance business through a
Reinsurance Pooling Agreement with Meridian Mutual and MC Mutual. In addition,
Meridian Mutual provides the facilities and many services required to conduct
MIGI's business. During 1999 MIGI paid Meridian Mutual $334,008 for
administrative and other services.
Description of Pooling Agreement
Meridian Mutual, Meridian Security, MC Mutual, MC Security and ICO are
parties to a Reinsurance Pooling Agreement. It covers all the property and
casualty insurance written by the parties. Thus, premiums, losses, loss
adjustment expenses and the underwriting and administrative expenses of the
parties are shared according to established percentages. Currently, the
participation percentages are 74 percent for MIGI's insurance subsidiaries, 22
percent for Meridian Mutual, and four percent for MC Mutual. These participation
percentages were fixed with reference to the relative surplus positions of the
companies.
The MIGI and Meridian Mutual Audit Committees have the responsibility
of monitoring the parties' relationships under the Reinsurance Pooling
Agreement. The Committees have established the procedures they deem necessary
and appropriate for this process. Their guidelines provide for:
o reviewing the participation percentages at least annually and
o referring any decision to change the participation percentages to
the Pooling Agreement Committees of MIGI and Meridian Mutual.
<PAGE>
MIGI's business and operations are integrated with and dependent upon
Meridian Mutual's business and operations. Management of Meridian Mutual and
MIGI will decide:
o which expenses relate to underwriting, meaning they will be shared
by the parties under the pooling agreement; and
o which assets and liabilities will be transferred among the parties
to the pooling agreement and what their values are.
The pooling agreement does not have established procedures for making these
decisions.
MIGI and Meridian Mutual do not always have the same interests. Their
interests conflict when it comes to:
o establishing participation ratios under the pooling agreement;
o allocating expenses unrelated to insurance underwriting; and
o MIGI's dividend policy.
Their interests may or may not be in conflict regarding:
o business and investment philosophies;
o profit objectives;
o cash management; and
o possibly other matters.
The wording of the pooling agreement itself eliminates some potential
conflicts. For instance, it doesn't matter which company insures a particular
pooled risk because the operating results of all the participants depend on the
results of the total business covered by the pooling agreement. Therefore, the
parties will have identical loss and loss adjustment expense ratios and
virtually identical expense ratios.
When the interests of MIGI and Meridian Mutual conflict, MIGI directors
make decisions based on their fiduciary duties to the Company and its
shareholders. However, individuals who are directors of both the Company and
Meridian Mutual also owe fiduciary duties to the policyholders of Meridian
Mutual. There are no procedures for having only disinterested directors make
those decisions.
Future events that could affect the participation percentages among the
parties include:
o Meridian Mutual's receipt of dividends on MIGI Common Shares it
owns;
o changes in the capital structure or asset values of any of the
parties to the pooling agreement;
o different effective rates of income taxation; or
o other factors which disproportionately affect the surplus of the
companies.
The pooling agreement has no fixed term. It will stay in effect with
regard to any one party until both Meridian Mutual and that party decide to end
the agreement. A vote by MIGI shareholders is not necessary to amend or
terminate the pooling agreement. If the pooling agreement were terminated:
o the terminating party would transfer back to Meridian Mutual the
liabilities ceded by Meridian Mutual plus an equal amount of
assets, and
o Meridian Mutual would transfer back to the terminating party the
liabilities ceded by the terminating party plus an equal amount of
assets.
Terminating the pooling agreement would not affect MIGI's ownership of all the
outstanding common shares of Meridian Security, MC Security and ICO.
<PAGE>
The pooling agreement cannot be terminated or the participation
percentages changed unless the Insurance Commissioners of Indiana, Minnesota and
Ohio give their approval. This requirement is for the protection of
policyholders of Meridian Security, MC Security, ICO, MC Mutual and Meridian
Mutual, and not for the protection of MIGI shareholders. MIGI intends for its
insurance subsidiaries to remain in the pooling agreement, absent unforeseen
changes in circumstances.
MIGI Audit Committee: Directors Barnette, Hackett, Humke and Price
Meridian Mutual Audit Committee: Directors Hackett, Humke and Price
MIGI Pooling Agreement Committee: Directors Barnette, Hackett, Humke, Kirr and
Oman
Meridian Mutual Pooling Agreement Committee: Directors Hackett, Humke and
Oman
EXECUTIVE COMPENSATION
The following table shows the compensation paid for the last three
years to MIGI's Chief Executive Officer and the four other most highly
compensated executives serving as MIGI executive officers as of December 31,
1999. Annual compensation includes amounts deferred at the officer's election.
All of MIGI's officers also serve as officers of Meridian Mutual. Meridian
Mutual reimburses MIGI for the services these "Named Executive Officers" perform
solely on behalf of Meridian Mutual.
<TABLE>
<CAPTION>
Summary Compensation Table
--------------------------
Long-Term Compensation
------------------------------
Annual Compensation Awards Payouts
------------------- ------ -------
Other Securities
Annual Underlying All Other
Name and Compen- Options/ LTIP Compen-
Principal Salary Bonus sation SARS Payouts sation
Position Year ($) ($) ($) (1) (#) (2) ($) ($) (3)
- -------- ---- --- --- ------- ------- --- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Norma J. Oman 1999 $350,000 $87,500 $233,222 --0-- --0-- $54,643
President and Chief 1998 340,192 --0-- --0-- --0-- --0-- 32,853
Executive Officer 1997 292,116 --0-- --0-- 81,590 --0-- 46,920
Steven R. Hazelbaker 1999 170,000 29,750 --0-- --0-- --0-- 4,800
Vice President 1998 163,762 --0-- --0-- --0-- --0-- 4,312
Chief Financial 1997 138,669 --0-- --0-- 19,333 --0-- 4,160
Officer and Treasurer
J. Mark McKinzie 1999 148,698 26,250 --0-- --0-- --0-- 4,299
Vice President 1998 148,577 --0-- --0-- --0-- --0-- 4,286
Corporate Secretary and 1997 130,654 --0-- --0-- 17,839 --0-- 3,920
General Counsel
Timothy J. Hanrahan 1999 150,000 26,250 19,093 --0-- --0-- 9,138
Senior Vice President 1998 140,962 --0-- --0-- --0-- --0-- 6,192
1997 113,054 --0-- --0-- 15,461 --0-- 3,392
Carl W. Buedel 1999 150,000 26,250 15,803 --0-- --0-- 8,673
Senior Vice President 1998 140,962 --0-- --0-- --0-- --0-- 6,082
1997 110,958 --0-- --0-- 14,436 --0-- 3,329
<PAGE>
<FN>
(1) For 1999, Other Annual Compensation reports the taxable portion of exercised
stock options, that being the difference between the fair market value of the
stock on the date of exercise and the option price.
(2) Options to acquire Common Shares granted pursuant to the 1996 Employee
Incentive Stock Plan, as adjusted for ten percent stock dividends distributed in
January 1999 and January 2000.
(3) For 1999, consists of Meridian Mutual's matching contributions of $4,800,
$4,800, $4,299, $4,308, and $4,308 to the Section 401(k) deferred compensation
accounts of Ms. Oman, Mr. Hazelbaker, Mr. McKinzie, Mr. Hanrahan, and Mr.
Buedel, respectively; and accruals under the Supplemental Retirement Income Plan
of $49,843, $4,830, and $4,365 for the accounts of Ms. Oman, Mr. Hanrahan, and
Mr. Buedel, respectively. For 1998, consists of MIGI's matching contributions of
$4,800, $4,312, $4,286, $4,229, and $4,229 to the Section 401(k) deferred
compensation accounts of Ms. Oman, Mr. Hazelbaker, Mr. McKinzie, Mr. Hanrahan,
and Mr. Buedel, respectively; and accruals under the Supplemental Retirement
Income Plan of $28,053, $1,963, and $1,853 for the accounts of Ms. Oman, Mr.
Hanrahan, and Mr. Buedel, respectively. For 1997, consists of MIGI's matching
contributions of $4,750, $4,160, $3,920, $3,392, and $3,329 to the Section
401(k) deferred compensation accounts of Ms. Oman, Mr. Hazelbaker, Mr. McKinzie,
Mr. Hanrahan, and Mr. Buedel, respectively; and an accrual under the
Supplemental Retirement Income Plan of $42,170 for the account of Ms. Oman.
</FN>
</TABLE>
The Board elects officers of MIGI for one-year terms. The officers
serve at the discretion of the Board of Directors. There is no family
relationship between any of the officers of the Company.
Mr. Hanrahan, age 54, was elected a Vice President of MIGI in 1994 and
a Senior Vice President in 1997. He has been a Vice President of Meridian Mutual
and Meridian Security for more than the past five years and a Meridian employee
since 1981.
Mr. Buedel, age 53, was elected a Vice President of MIGI in 1994 and
Senior Vice President in 1997. He has been a Vice President of Meridian Mutual
and Meridian Security since 1990. Mr. Buedel has been a Meridian employee since
1981.
Mr. Hazelbaker, age 44, was elected Chief Financial Officer and
Treasurer of MIGI, Meridian Mutual and Meridian Security in 1994 and a Vice
President of all three companies in 1995. From 1987 until joining the Company in
1994, he was a partner with PricewaterhouseCoopers L.L.P.
Mr. McKinzie, age 46, terminated his employment with the Company in
January 2000. Prior to leaving the Company, he had served as Vice President,
Corporate Secretary, and General Counsel of MIGI, Meridian Mutual, and Meridian
Security for more than the past five years.
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN 1999 AND
1999 YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
The following table shows information about options exercised during
1999 and about unexercised options held at December 31, 1999, by the Named
Executive Officers. The Company does not have any outstanding stock appreciation
rights.
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Shares Options/SARs at Fiscal Year End(#) Options/SARs at Fiscal Year End($) (3)
Acquired Exercisable(E)/ Exercisable(E)/
Name On Exercise(#)(1) Value Realized($) (2) Unexercisable(U) Unexercisable(U)
- ---- ----------------- --------------------- ---------------------------------- --------------------------------------
<S> <C> <C> <C> <C>
Norma J.
Oman 30,568 $233,222 141,814 E $ 332,374 E
Steven R.
Hazelbaker --0-- --0-- 41,343 E 111,159 E
J. Mark
McKinzie --0-- --0-- 38,015 E 102,011 E
Timothy J.
Hanrahan 3,850 19,093 28,761 E 70,887 E
Carl W.
Buedel 3,300 15,803 28,561 E 73,332 E
<FN>
(1) Share number reflects adjustment for ten percent stock dividend declared in
December 1999.
(2) Aggregate market value of the Common Shares covered by the option less the
aggregate price paid by the executive.
(3) Amounts reflecting gains on outstanding options are based on the December
31, 1999, closing stock price of $14.00.
</FN>
</TABLE>
Pension Plan
The Company maintains a defined benefit pension plan for eligible
employees. All MIGI employees completing more than 1,000 hours of employment
during a plan year become eligible to participate in the plan. The following
table shows the range of estimated annual benefits payable upon retirement for
graduated levels of average annual earnings and years of service, based on
retirement at age 65 in 2000. The annual earnings cannot exceed the $170,000
maximum compensation limit for purposes of pension calculations.
PENSION PLAN TABLE
Years of Service
-------------------------------------------------------
Remuneration 15 20 25 30 35
- ------------ -- -- -- -- --
$120,000 $28,209 $37,613 $47,016 $54,419 $65,822
200,000 38,709 51,613 64,516 77,419 90,322
250,000 38,709 51,613 64,516 77,419 90,322
350,000 38,709 51,613 64,516 77,419 90,322
450,000 38,709 51,613 64,516 77,419 90,322
550,000 38,709 51,613 64,516 77,419 90,322
<PAGE>
The plan provides a pension annuity beginning at age 65 of 1.125
percent of the employee's final monthly earnings for each year of credited
service plus .625 percent of the employee's final monthly earnings in excess of
the monthly Social Security covered compensation, if any, for each year of
credited service to a maximum of 35 years. "Final monthly earnings" mean the
employee's average monthly pay during his or her five highest consecutive salary
years out of the last ten. "Credited service" means calendar years during which
the employee completes at least 1,000 hours of employment. The plan also
provides benefits for delayed retirement, early retirement, and death and
disability. Early retirement benefits are available at age 55. The plan has
provisions for optional methods of benefit payment, payments to an employee
leaving after a certain number of years of service, and payments to the
employee's surviving spouse. Benefits listed in the table are computed based on
a straight life annuity and are not subject to any deduction for Social Security
or other offset amounts. Section 415 of the Internal Revenue Code allows an
individual maximum annual benefit of $135,000 for 2000. The Plan covers
compensation consisting of salary and cash bonus. For 1999, covered compensation
for the Named Executive Officers was: Ms. Oman, $437,500; Mr. Hazelbaker,
$199,750; Mr. McKinzie, $174,950; Mr. Hanrahan, $176,250; Mr. Buedel, $176,250.
The estimated credited years of service for the Named Executive
Officers as of January 2000 are listed below:
Estimated Years of
Credited Service
Norma J. Oman.................. 26
Steven R. Hazelbaker........... 6
J. Mark McKinzie............... 11
Carl W. Buedel................. 18
Timothy J. Hanrahan............ 19
Supplemental Retirement Income Plan
The Supplemental Retirement Income Plan covers certain MIGI employees
with more than ten years of credited service. These employees also participate
in the MIGI Pension Plan. The supplemental plan provides benefits in excess of
the limitations imposed by Section 401(a)(17) and Section 415 of the Internal
Revenue Code. The Supplemental Retirement Benefit is payable to an eligible
participant as a straight life annuity over the lifetime of the participant
beginning on the participant's normal retirement date. Early retirement benefits
are available at age 55. The Plan also has provisions for optional joint and
survivor methods of benefit payment. The Benefit will be a monthly amount equal
to the difference between (a) the monthly amount of the MIGI Pension Plan
retirement benefit to which the participant would have been entitled if computed
without the limitations under the Internal Revenue Code and (b) the monthly
amount of the benefit actually payable to the participant under the MIGI Pension
Plan.
The following table lists the Supplemental Retirement Benefit payable
upon retirement for graduated levels of average annual earnings and years of
service for participants under the Plan, based on retirement at age 65 in 2000.
The benefits are not subject to any deduction for Social Security or other
offset amounts. The 1999 compensation covered by the Plan for the Named
Executive Officers is found under the caption, "Pension Plan." Their estimated
years of credited service are also listed under "Pension Plan."
<PAGE>
Supplemental Retirement Income Plan Table
Years of Service
-----------------------------------------------------------
Remuneration 15 20 25 30 35
- ------------ -- -- -- -- --
$170,000...... $ 2,625 $ 3,500 $ 4,375 $ 5,250 $ 6,125
200,000...... 10,500 14,000 17,500 21,000 24,500
250,000...... 23,625 31,500 39,375 47,250 55,125
300,000...... 36,750 49,000 61,250 73,500 85,750
350,000...... 49,875 66,500 83,125 99,750 116,375
400,000...... 63,000 84,000 105,000 126,000 147,000
450,000...... 76,125 101,500 126,875 152,250 177,625
550,000...... 102,375 136,500 170,625 204,750 238,875
Executive Bonus Compensation Plan
MIGI maintains a bonus compensation plan for key executive employees
("the Plan"). The President selects Plan participants each year, subject to
approval of the Compensation Committees of the MIGI and Meridian Mutual Boards
of Directors. The purpose of the Plan is to establish compensation commensurate
with corporate performance compared to goal. Criteria for determining bonus
payments are established prior to the beginning of each year. The performance
measure for 1999 was the combined pre-tax net income of Meridian Mutual,
Meridian Security and the Meridian Citizens Group. Graduated amounts of cash
bonuses become payable if the combined financial performance of these companies
meets the threshold level of 80 percent of goal or exceeds it up to a maximum of
120 percent of goal. After the close of the year, performance is evaluated
relative to the predetermined goals. Actual bonus awards are determined on the
basis of this evaluation. The participant may elect to receive the bonus in cash
or MIGI stock or a combination of the two.
COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation Committee of our Board of Directors, together with the
Compensation Committee of Meridian Mutual, is responsible for establishing and
administering the executive compensation program for MIGI executives. Both
Compensation Committees are composed entirely of directors who are not employees
of the Company or Meridian Mutual.
The goal of our executive compensation policy is to attract, motivate
and retain competent personnel. At the same time, we want to ensure an
appropriate relationship exists between executive pay and MIGI's performance.
Executive compensation consists of base salary, a bonus compensation plan and
stock-based incentives. In establishing the base salary portion of executive
compensation, the Committee gives significant consideration to such factors as:
o maintaining MIGI's competitiveness
o establishing efficient and effective use of MIGI's resources
o preserving MIGI's good standing with regulatory and rating agencies
o managing daily operations and
o developing and achieving long-term and strategic objectives.
<PAGE>
The Committee has not assigned relative weights to these factors. Through a
bonus compensation plan, the Committee seeks to reward the attainment of
targeted income goals. The Compensation Committee's philosophy is to slow the
growth in base salary and put a greater portion of total compensation at risk
through the bonus plan. In addition, the Committee seeks to provide equity-based
incentives to further motivate executives over the long term to respond to
MIGI's business challenges and opportunities as owners rather than just as
employees. The Compensation Committee intends for executive annual compensation
to continue to be tax-deductible to the Company.
The Compensation Committee annually considers salary surveys produced
by independent compensation consulting firms. This information helps the
Committee determine appropriate levels of executive compensation. For the
positions of Chief Executive Officer and Chief Financial Officer, the survey
data compares the Company with other insurance companies and with all other
industries based on:
o comparable asset levels
o direct written premiums
o net written premiums and
o other relevant indices.
For other executive positions, the Committee considers salary surveys comparing
MIGI with other insurance companies of similar asset and premium levels. Some of
the insurance companies participating in the salary surveys are included in the
Total Return Industry Index for NASDAQ Insurance Stocks. The Total Return
Industry Index is shown in the Stock Performance Graph of this Proxy Statement.
The "Executive Bonus Compensation Plan" is described on the preceding
page of this Proxy Statement. The Plan allows executives to earn additional
compensation if Meridian Mutual, Meridian Security and the Meridian Citizens
Group attain certain levels of annual pre-tax income. Within the Plan, a cash
bonus is calculated as a percentage of base salary and is benchmarked annually
against the salary surveys and other information from the independent
compensation consulting firms. If a bonus is earned under the Plan, executives
may elect to take it in cash or MIGI stock or a combination of the two.
MIGI's long-term incentive program, designed by an outside consultant,
consists of grants under the Employee Incentive Stock Plan. Under this Plan, key
employees may receive grants of incentive stock options, non-qualified stock
options, appreciation rights and restricted stock awards. In 1997, each
executive received vested options with a ten-year term. The size of the option
grant was a percentage of the individual's base salary. Different percentages
applied to the Chief Executive Officer, Senior Vice Presidents, and all other
executive officers, commensurate with the amount of responsibility for their
positions. When the Committee established the size of the grants, it considered
both outstanding options and market practices for similar positions in stock
insurance companies. Some of these companies are included in the Total Return
Industry Index for NASDAQ Insurance Stocks.
<PAGE>
In 1998, the Committee's annual performance review of the executive
staff occurred mid-year with salary adjustments effective in late May 1998. Due
to the timing of the salary adjustments for 1998, the Committee decided not to
consider base salary adjustments in 1999 for the executive staff. As a result,
Ms. Oman's 1999 base salary was below the average for chief executive officers
of insurance companies with direct and net written premiums over $200 million.
It was also below the average salary for chief executive officers of
similarly-sized companies across all industries. Ms. Oman did not receive a
bonus under the executive bonus compensation plan for 1999 results because the
combined pre-tax net income of the Meridian and Meridian Citizens companies did
not meet the 80 percent threshold level established under the plan. The
compensation philosophy provides latitude for the Committee to award
discretionary bonuses when it believes the Company's strong underlying
performance has been negatively impacted by unusual, significant catastrophe
losses, as was the case in 1996, 1997 and 1998. In order to assure the Company
would remain competitive in the market for executive talent and would be able to
retain its core management team, the Committee awarded discretionary bonuses to
Ms. Oman and certain other members of the executive staff in February 1999. Ms.
Oman's total compensation package was lower than the average paid to chief
executive officers of the comparison companies.
With no base salary adjustments made by the Committee during 1999, the
salaries of the other executive officers were below the competitive range of
people with comparably responsible positions at similarly-sized insurance
companies, both regionally and nationally. The 1999 combined pre-tax net income
of Meridian Mutual, Meridian Security and Meridian Citizens Group did not meet
the 80 percent threshold level so the executives received no bonuses under the
executive bonus compensation plan. In early 1999, as discussed above, the
Committee awarded a discretionary bonus to the executives in individualized
amounts corresponding with responsibility and contribution levels based on its
evaluation of their work performance. The total compensation listed in the
Summary Compensation Table for the other executives was lower than the
comparison companies surveyed.
MIGI Compensation Committee Meridian Mutual Compensation Committee
Ramon L. Humke and Thomas H. Sams Martha D. Lamkin, Chairperson, and
Ramon L. Humke
<PAGE>
Stock Performance Graph
The following performance graph compares the cumulative total shareholder
return on the Company's Common Shares with:
o the Center for Research in Securities Prices (CRSP) Total Return Index
for NASDAQ Stock Market (U.S.Companies) and
o the CRSP Total Return Industry Index for NASDAQ Insurance Stocks for
the years 1995 through 1999.
The comparison assumes $100 was invested on December 31, 1994, in MIGI's Common
Shares and in the CRSP indices. It also assumes reinvestment of dividends. The
CRSP Total Return Industry Index for NASDAQ Insurance Stocks includes all
insurance companies quoted on the NASDAQ stock market within the SIC codes 631
and 633. Upon a written request to MIGI's Corporate Secretary, we will undertake
to provide the names of the companies listed on the NASDAQ insurance stock
index.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
MIGI, NASDAQ STOCK MARKET (U.S.), NASDAQ INSURANCE STOCKS
Migi NASDAQ Stock Market (U.S.) NASDAQ Insurance Stocks
12/31/94 100.000 100.000 100.000
12/31/95 147.854 141.335 142.048
12/31/96 149.792 173.892 161.922
12/31/97 173.352 213.073 237.522
12/31/98 233.927 300.248 211.579
12/31/99 181.689 542.430 164.286
(Stock Performance Graph Appears Here)
<PAGE>
Compensation Committee Interlocks and Insider Participation
MIGI's Compensation Committee consists of Thomas H. Sams and Ramon L.
Humke, Chairman of the MIGI Board of Directors. The bylaws of the Company
provide that the Chairman of the Board is an officer of the Company, but Mr.
Humke is not an employee of the Company. Mr. Humke also serves on the
Compensation Committee of Meridian Mutual.
Change-in-Control Agreements
MIGI has executed change-in-control severance pay arrangements with the
executives of MIGI and Meridian Mutual. The Termination Benefits Agreement
("Agreement") would provide severance payments and benefits to the executives if
their employment is terminated under certain circumstances within one year
following a change in control. A "change in control" would occur if 50 percent
or more of MIGI's outstanding Common Shares were acquired by an entity other
than the Company, Meridian Mutual or an employee benefit plan of the Company.
There are additional conditions that could result in a change-in-control event.
MIGI may not waive or modify provisions of the Agreement, either before or after
a change in control, without the written consent of the participant. However,
either MIGI or the participant may elect not to extend the Agreement for the
next calendar year by giving written notice.
Under the Agreement, termination for other than "cause" after a change
in control would entitle Ms. Oman, Mr. Hazelbaker, Mr. Hanrahan and Mr. Buedel
to any earned and unpaid bonus and to a lump sum payment equal to 2.99 times
their average annual cash compensation received over the past five years. All
other eligible executives would receive any earned and unpaid bonus and a lump
sum payment equal to two times their average annual cash compensation received
over the past five years.
Compensation of Directors
MIGI directors who are also salaried employees of the Company receive
no fees for services as directors. MIGI Board members who were not salaried
Company employees and who did not serve on the Board of any affiliates received
an annual retainer of $15,000 in 1999. Of that, $10,000 was paid in cash and
$5,000 in MIGI Common Shares. The Common Shares were valued at their fair market
value two days after MIGI's annual results were released to the public.
Effective April 2000, the annual retainer has been increased to $20,000. Of that
amount, $5,000 is payable in MIGI Common Shares, and the balance is payable in
any combination of cash and MIGI Common Shares at the election of the Director.
Nonemployee MIGI Board members serving on the Board of an affiliate receive a
$1,000 annual retainer from MIGI.
The Chairman of the MIGI Board earned a total stipend of $30,000 in
1999, of which $10,000 was paid in MIGI Common Shares. Effective April 2000, the
Chairman's annual retainer has been increased to $40,000. While $10,000 is
payable in MIGI Common Shares, the Chairman may elect to take the remaining
$30,000 in any combination of cash and MIGI Common Shares. The chairmen of one
or more affiliated Boards or one or more Board committees receive an additional
$1,600 per year for services in those capacities. All directors, aside from
salaried employees, receive per diem meeting fees of $1,000 for each Board or
Committee meeting they attend.
<PAGE>
MIGI had a defined benefit pension plan for the benefit of eligible
nonemployee directors of MIGI or Meridian Mutual until the Board terminated the
plan in February 2000. Directors became eligible to participate in the plan
after completing five years of credited service. This meant all calendar years
the nonemployee director attended at least 50 percent of the regular quarterly
meetings. The plan provided a monthly retirement allowance equal to 1.75 percent
of the final earnings for each year of credited service. Final earnings were the
five consecutive years with the highest average annual total fees paid during
the period of directorship. The monthly retirement allowance began on the
director's retirement date and continued monthly for his or her lifetime until
the plan was terminated in February 2000. The plan also provided benefits for
delayed retirement, early retirement or death. Early retirement benefits were
available at age 55. The directors could select an optional method of benefit
payment. When the plan was terminated in 2000, directors received a cash payment
equivalent to the present value of their accrued benefit.
MIGI has an Outside Director Stock Option Plan. An "outside director"
is a director of either MIGI or Meridian Mutual who is not a Meridian employee
on the date of grant. Each Outside Director was granted an option to purchase
1,000 Common Shares in May of each year from 1994 through 1999. Ten percent
stock dividends declared in 1999 and 2000 have increased each of these option
grants to 1,210 shares. Each Outside Director will be granted an option to
purchase 1,210 Common Shares on the date of each Annual Meeting of Shareholders
in the years 2000 through 2003, unless the plan is terminated earlier. The
directors will pay the Company no consideration for being granted the option.
The exercise price per share will equal the fair market value of a Common Share
on the date of grant. Each option will be exercisable beginning one year after
the date of grant. Each option will expire no later than ten years after the
date of grant.
OTHER MATTERS
Appointment of Auditor
The firm of PricewaterhouseCoopers served as MIGI's independent auditor
for the fiscal year ended December 31, 1999. The Board of Directors has not
selected an independent auditor for the current fiscal year ending December 31,
2000. We anticipate the Audit Committee, at its meeting on April 26, 2000, will
recommend that the Board select PricewaterhouseCoopers as the Company's
independent auditor for 2000. Representatives of PricewaterhouseCoopers will not
be attending the Annual Meeting.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires MIGI's
directors and executive officers, and persons owning more than ten percent of a
registered class of MIGI's equity securities, to file initial reports of their
ownership of MIGI Common Shares and reports of changes in their ownership with
the Securities and Exchange Commission. Based solely on review of the copies of
forms furnished to MIGI, or written representations that no annual forms (SEC
Form 5) were required, MIGI believes its officers, directors, and greater than
ten-percent beneficial owners have complied with all Section 16(a) filing
requirements applicable to them.
<PAGE>
Other Business
We do not expect any business to come up for shareholder vote at the
Annual Meeting other than the items described in the Notice of Meeting and in
this Proxy Statement. If other business is properly raised at the Meeting or any
adjournment of it, your proxy card authorizes the people named as proxies to
vote according to their best judgment.
Expenses of Proxy Solicitation
We will pay all expenses of proxy solicitation. We will pay brokers,
nominees, fiduciaries or other custodians their reasonable expenses for
forwarding proxy and solicitation material to persons for whom they hold MIGI
Common Shares. We will solicit proxies primarily by mail. However, MIGI officers
and employees may also solicit in person or by telephone.
We mailed the 1999 Annual Report to Shareholders along with this Proxy
Statement.
By Order of the Board of Directors,
/s/ Norma Oman
Norma J. Oman
President and Chief Executive Officer
April 3, 2000
<PAGE>
PROXY CARD PROXY CARD
Meridian Insurance Group, Inc.
This proxy is solicited on behalf of the Board of Directors
for the Annual Meeting of Shareholders to be held on May 10, 2000
The undersigned appoints Norma J. Oman, James D. Price, and Sarah W. Rowland,
or any of them, proxies for the undersigned, each with full power of
substitution, to attend the Annual Meeting of Shareholders of Meridian Insurance
Group, Inc., to be held on May 10, 2000, at 2:00 p.m., EST, and at any
adjournments or postponements of the Annual Meeting, and to vote as specified in
this Proxy all the Common Shares of the Company which the undersigned would be
entitled to vote if personally present. This Proxy when properly executed will
be voted in accordance with your indicated directions. If no direction is made,
this Proxy will be voted FOR the election of Directors. In their discretion the
proxies are authorized to vote upon such other business as may properly come
before the meeting.
The Board of Directors recommends a vote FOR the election of Directors.
YOUR VOTE IS IMPORTANT! PLEASE MARK, SIGN AND DATE THIS PROXY ON THE REVERSE
SIDE. THEN DETACH THE PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
(Continued and to be signed on reverse side.)
<PAGE>
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY.
1. Election of Directors--
Nominees: 01-Joseph D. Barnette, Jr., 02-Ramon L. Humke,
and 03-Thomas H. Sams
For Withheld For All
All All Except
O O O
- ------------------------------------
(Except nominee(s) written above.)
The undersigned acknowledges receipt of the Notice of Annual Meeting of
Shareholders and of the Proxy Statement.
Dated:__________________, 2000
Signature(s)______________________
- ----------------------------------
Please sign exactly as your name appears. Joint owners should each sign
personally. When applicable, indicate your official position or representation
capacity.
YOUR VOTE IS IMPORTANT! PLEASE MARK, SIGN, DATE AND DETACH THE ABOVE PROXY.
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
