<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
TCF Financial Corporation
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Diane Stockmazn, Anthony Branch
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/X/ 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>
TCF-REGISTERED TRADEMARK-
TCF FINANCIAL CORPORATION
801 MARQUETTE AVENUE, SUITE 302, MINNEAPOLIS, MN 55402
(612) 661-6500
MARCH 15, 1995
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders (the
"Annual Meeting") of TCF Financial Corporation ("TCF Financial" or "TCF") which
will be held at the Minneapolis Athletic Club, 615 Second Avenue South,
Minneapolis, Minnesota, on Wednesday April 19, 1995, at 2:00 p.m. local time.
At the Annual Meeting you will be asked to elect five directors to the
Board; to ratify the Board's choice of independent public accountants; to
approve the enlargement of the maximum permissible size of the Board of
Directors from 15 to 25; to approve the adoption of a new incentive stock
program; and to approve a directors deferred compensation plan and trust
agreement.
Your vote is important, regardless of the number of shares you own. On
behalf of the Board, I urge you to sign, date and return the enclosed proxy card
as soon as possible, even if you plan to attend the Annual Meeting. If you
receive more than one proxy card, because you have multiple accounts with TCF
Financial common stock, please sign, date and return each proxy card so that all
your shares will be voted. This will not prevent you from voting in person, but
will assure that your vote is counted if you are unable to attend the Annual
Meeting.
Sincerely,
William A. Cooper
Chairman and Chief Executive Officer
<PAGE>
TCF-REGISTERED TRADEMARK-
TCF FINANCIAL CORPORATION
801 MARQUETTE AVENUE, SUITE 302, MINNEAPOLIS, MN 55402
(612) 661-6500
________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 19, 1995
TO THE STOCKHOLDERS OF TCF FINANCIAL CORPORATION
The Annual Meeting of the Stockholders (the "Annual Meeting") of TCF Financial
Corporation ("TCF Financial" or "TCF") will be held at the Minneapolis Athletic
Club, 615 Second Avenue South, Minneapolis, Minnesota, on Wednesday, April 19,
1995, commencing at 2:00 p.m. local time for the following purposes:
1. To elect five directors;
2. To ratify the appointment of KPMG Peat Marwick LLP as independent
public accountants for the fiscal year ending December 31, 1995;
3. To increase the maximum permissible size of the Board of TCF Financial
Corporation from 15 to 25 members;
4. To approve the TCF Financial 1995 Incentive Stock Program;
5. To approve the Directors Deferred Compensation Plan and Trust
Agreement.
Only holders of record of TCF Financial's common stock at the close of
business on March 1, 1995, are entitled to notice of and to vote at the Annual
Meeting or any adjournment thereof.
Whether or not you plan to attend the Annual Meeting in person, please fill
in, sign and date the enclosed proxy card and mail it promptly. Should you
attend the Annual Meeting, you may revoke your proxy and vote in person. A
return envelope, which requires no postage if mailed in the United States, is
enclosed for your convenience.
By Order of the Board of Directors
William A. Cooper
Chairman and Chief Executive Officer
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE SIGN THE
PROXY CARD AND RETURN IT IN THE ENCLOSED ENVELOPE.
Minneapolis, Minnesota
March 15, 1995
2
<PAGE>
TCF FINANCIAL CORPORATION
801 MARQUETTE AVENUE, SUITE 302, MINNEAPOLIS, MN 55402
(612) 661-6500
The enclosed proxy is solicited by and on behalf of the Board of Directors
(the "Board") of TCF Financial Corporation ("TCF Financial" or "TCF"), a
Delaware corporation, for use at the Annual Meeting of Stockholders (the "Annual
Meeting") to be held on Wednesday, April 19, 1995, commencing at 2:00 p.m.,
Central Time, at the Minneapolis Athletic Club, Minneapolis, Minnesota, and at
any adjournment thereof. The principal executive offices of TCF are located at
the address set forth above.
PURPOSES OF MEETING. The purposes of the Annual Meeting are to consider
and vote upon: (a) election of five directors; (b) ratification of the
appointment of KPMG Peat Marwick LLP as independent public accountants for the
fiscal year ending December 31, 1995; (c) increasing the maximum permissible
size of the Board of TCF Financial from 15 to 25 members; (d) approval of the
TCF Financial 1995 Incentive Stock Program; (e) approve the Directors Deferred
Compensation Plan and Trust Agreement; and (f) any other matters as may properly
come before the Annual Meeting.
SHARES OUTSTANDING AND ENTITLED TO VOTE; RECORD DATE. The close of
business on March 1, 1995 has been fixed by the Board as the record date (the
"record date") for the determination of holders of common stock of TCF
Financial, par value $.01 per share, ("TCF Common Stock") entitled to notice of
and to vote at the Annual Meeting and any adjournment or adjournments thereof.
At the close of business on the record date, there were 17,410,911 shares of TCF
Common Stock outstanding and entitled to vote, held by approximately 9,590
holders of record. Each share of TCF Common Stock entitles the holder thereof
to one vote on each matter to be submitted to TCF stockholders at the Annual
Meeting.
VOTE REQUIRED. A quorum, consisting of a majority of the voting power of
the issued and outstanding TCF Common Stock entitled to vote at the Annual
Meeting, must be present in person or by proxy before any action may be taken at
the Annual Meeting. Assuming a quorum is present, a plurality of the votes
present in person or represented by proxy at the Annual Meeting is necessary for
the election of directors and a majority of such votes is necessary for
ratification of KPMG Peat Marwick LLP as independent public accountants, to
approve the TCF Financial 1995 Incentive Stock Program, and to approve the
Directors Deferred Compensation Plan and Trust Agreement. In order to approve
the increase in the maximum permissible size of the Board of TCF Financial from
15 to 25 members, 80% of the shares of TCF Common Stock entitled to vote must
approve the proposal. Abstentions are counted as shareholders present, for
purposes of the quorum requirement, but are not counted as voting in favor of
the proposal. Broker non-votes will have the same effect as votes against the
proposals. As of the record date, the directors and executive officers of TCF
and their affiliates in the aggregate beneficially owned and are entitled to
vote 3,164,785 shares or 18.19% of the outstanding shares of TCF Common Stock.
VOTING; SOLICITATION AND REVOCATION OF PROXIES. A proxy card for use at
the Annual Meeting accompanies this Proxy Statement and is solicited by the
Board. Any TCF stockholder executing a proxy card may revoke it at any time
before it is voted by filing with the Secretary of TCF, at the address of TCF
set forth above, written notice of such revocation; by executing a later-dated
proxy; or by attending the Annual Meeting and giving notice of such revocation
in person. Attendance at the Annual Meeting will not, in and of itself,
constitute revocation of a proxy card. Participants voting shares in the TCF
Employees Stock
3
<PAGE>
Ownership Plan-401(k) will find voting and revocation procedures described in
the special proxy card sent to them. TCF will bear the cost of solicitation of
proxies and has retained Georgeson & Co., a professional proxy solicitor, for
this Annual Meeting because of the higher (80%) vote approval requirement for
the proposal to increase the maximum permissible size of the Board. Georgeson &
Co. estimates its fees will be between $10,000 and $100,000 for this
solicitation, depending on the number of mailings and other contacts required to
obtain the necessary return of votes.
Each proxy returned to TCF (and not revoked) will be voted in accordance
with the instructions indicated thereon. IF NO INSTRUCTIONS ARE INDICATED, THE
PROXY WILL BE VOTED: (1) FOR THE ELECTION OF THE NOMINEES FOR DIRECTORS NAMED
IN THIS PROXY STATEMENT; (2) IN FAVOR OF RATIFYING THE APPOINTMENT OF KPMG PEAT
MARWICK LLP AS INDEPENDENT PUBLIC ACCOUNTANTS OF TCF FINANCIAL; (3) IN FAVOR OF
INCREASING THE MAXIMUM PERMISSIBLE SIZE OF THE BOARD OF TCF FINANCIAL FROM 15 TO
25 MEMBERS; (4) IN FAVOR OF APPROVING THE TCF FINANCIAL 1995 INCENTIVE STOCK
PROGRAM; and (5) IN FAVOR OF APPROVING THE DIRECTORS DEFERRED COMPENSATION PLAN
AND TRUST AGREEMENT. While the Board knows of no other matters to be presented
at the Annual Meeting, if any other matter properly comes before the meeting or
any adjournment thereof, all proxies returned to TCF will be voted on any such
matter in accordance with the judgment of the proxy holders.
BENEFICIAL OWNERSHIP OF TCF COMMON STOCK. See "Election of TCF Directors -
Securities Ownership of TCF Directors, Executive Officers and Significant
Stockholders."
PROPOSAL 1
ELECTION OF TCF DIRECTORS
INFORMATION ON DIRECTORS AND NOMINEES
The Restated Certificate of Incorporation (the "Certificate") of TCF
Financial provides that the Board shall be divided into three classes, each to
be comprised of as nearly equal a number of directors as possible. The
directors of each class are to serve for terms of three years, with one class
being elected each year. TCF Financial's Certificate currently provides that
the number of directors shall be not fewer than seven or more than fifteen, with
the exact number of directors fixed from time to time by a resolution duly
adopted by a majority of the Continuing Directors (as defined) of the Board.
Under Proposal 3, the Certificate would be amended to increase the maximum
permissible size of the Board of TCF Financial from 15 to 25 members.
Stockholders will be asked at the Annual Meeting to elect five directors to
serve for three-year terms expiring at the Annual Meeting in 1998, or until a
successor is elected. Unless authority is withheld, all proxies received in
response to this solicitation will be voted for the election of the nominees
listed below. All nominees have indicated a willingness to serve if elected.
If any nominee becomes unable to serve prior to the Annual Meeting, the proxies
received in response to this solicitation will be voted for a replacement
nominee selected in accordance with the best judgment of the proxy holders named
therein.
4
<PAGE>
<TABLE>
<CAPTION>
POSITION(S) WITH DIRECTOR
NAME TCF FINANCIAL AGE SINCE*
- - ---- ---------------- --- --------
NOMINEES FOR ELECTION AS DIRECTORS
<S> <C> <C> <C>
CLASS II - TERM EXPIRES 1998
Joseph P. Clifford . . . . . . . . Director and Vice Chairman 51 1987
Robert E. Evans. . . . . . . . . . Director and Vice Chairman 59 1990
Luella G. Goldberg . . . . . . . . Director 58 1988
Mark K. Rosenfeld. . . . . . . . . Director 48 1995
Ralph Strangis . . . . . . . . . . Director 58 1991
<CAPTION>
DIRECTORS WHOSE TERMS DO NOT EXPIRE IN 1995
<S> <C> <C> <C>
CLASS III - TERM EXPIRES 1996
Rudy Boschwitz . . . . . . . . . . Director 64 1991
William A. Cooper. . . . . . . . . Director, Chairman and
Chief Executive Officer 51 1987
Thomas A. Cusick . . . . . . . . . Director and Vice Chairman 50 1988
Thomas J. McGough. . . . . . . . . Director 61 1989
Ronald A. Ward . . . . . . . . . . Director 50 1993
CLASS I - TERM EXPIRES 1997
Bruce G. Allbright . . . . . . . . Director 66 1987
Robert J. Delonis. . . . . . . . . Director, Chairman and Chief
Executive Officer of Great
Lakes Bancorp** 43 1995
John M. Eggemeyer, III . . . . . . Director 49 1994
Daniel F. May . . . . . . . . . . Director 65 1988
Roy E. Weber . . . . . . . . . . . Director 66 1995
<FN>
*Does not include service at TCF Bank Minnesota fsb ("TCF Bank Minnesota"), a
wholly owned subsidiary of TCF Financial.
**Refers to Great Lakes Bancorp, A Federal Savings Bank, ("Great Lakes Bancorp")
which became a wholly owned subsidiary of TCF Financial on February 8, 1995.
</TABLE>
THE TCF BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT TCF STOCKHOLDERS VOTE FOR
THE NOMINEES FOR THE TCF BOARD OF DIRECTORS.
BACKGROUND OF DIRECTORS. The following discussion sets forth certain
information with respect to the persons who are nominees for directors of TCF
Financial at the Annual Meeting as well as similar information for the other
directors of TCF Financial whose terms do not expire this year. TCF Financial
knows of no arrangements or understandings between a director or nominee and any
other person pursuant to which he or she has been selected as a director or
nominee. There is no family relationship between any of the nominees, directors
or executive officers of TCF Financial.
5
<PAGE>
* JOSEPH P. CLIFFORD has been Vice Chairman of TCF Financial since its
formation in 1987. Mr. Clifford has been a director of TCF Financial since its
formation in 1987.
* ROBERT E. EVANS has been a director of TCF Financial since 1990, and was
elected Vice Chairman of TCF Financial in 1993. Mr. Evans has been a director
of TCF Bank Minnesota since 1987 and was elected an Executive Vice President of
TCF Bank Minnesota in 1993. Mr. Evans also serves on the Board of Directors of
Minnesota Brewing Company.
* LUELLA G. GOLDBERG has been a director of TCF Financial since 1988. She
is an active member of the Board of Directors of several Minnesota corporations
and associations. She has been a director of Northwestern National Life
Insurance Company since 1976 and of its holding company, Reliastar (the NWNL
Companies) since its formation in 1989. She has also been a director of Piper
Jaffray Investment Trust Inc. since 1987 and of a number of related closed-end
investment companies since 1988. In 1993, Ms. Goldberg joined the Board of
Directors of Hormel Foods Corporation. Ms. Goldberg is former Chair of the
Board of Trustees and former acting President of Wellesley College and continues
to serve as a trustee of that College. Ms. Goldberg is also a past Chair of the
Board of the Minnesota Orchestral Association.
* MARK K. ROSENFELD is Chairman, Chief Executive Officer and director of
Jacobson Stores Inc., a retail department store based in Jackson, Michigan. He
has been a director of Great Lakes Bancorp since 1987 and was elected a director
of TCF Financial in February 1995. He serves on the Board of Trustees for
Jackson Community College, is a trustee and a member of the Executive Committee
of Michigan Colleges Foundation, and is a director of the National Retail
Federation and the Michigan Retailers Association.
* RALPH STRANGIS is a founding member of the Minneapolis law firm of
Kaplan, Strangis and Kaplan, P.A. Mr. Strangis is also a director of National
Presto Industries, Inc., Life USA Holding, Inc., Payless Cashways, Inc. and
Damark International, Inc. He has been a director of TCF Financial since 1991.
RUDY BOSCHWITZ is Chairman of Home Valu, Inc., a company he founded. He
also served as a United States Senator from the State of Minnesota from 1978 to
1991. He is a director of the Chicago Mercantile Exchange in Chicago, Illinois,
the COMSAT Corp. in Bethesda, Maryland, which is in the business of satellite
communications for telephones and television, and of Sunbelt Nurseries, Ft.
Worth, Texas. Mr. Boschwitz has been a director of TCF Financial since 1991.
WILLIAM A. COOPER has been Chairman of the Board of TCF Financial since its
formation in 1987 and of TCF Bank Minnesota since 1985. Mr. Cooper has also
been Chief Executive Officer of TCF Financial since 1987 and was Chief Executive
Officer of TCF Bank Minnesota until 1993. Mr. Cooper serves on the Federal
Reserve Board's Thrift Institutions Advisory Council and on the Boards of
Directors of the Minnesota Business Partnership, Minnesota Meeting and the
Center for the American Experiment. Mr. Cooper has been a director of TCF
Financial since its formation in 1987 and of TCF Bank Minnesota since 1985.
THOMAS A. CUSICK was elected Vice Chairman of TCF Financial in 1993.
Before that he had been President and Chief Operating Officer of TCF Financial
since its formation in 1987. Mr. Cusick was elected Chief Executive Officer of
TCF Bank Minnesota in 1993. Mr. Cusick is a member of the Board of Trustees of
the College of St. Benedict, is a director of Damark International, Inc., and is
a past Chairman of the Savings League of Minnesota. Mr. Cusick has been a
director of TCF Financial since 1988.
____________
* Nominee for election at the Annual Meeting.
6
<PAGE>
THOMAS J. MCGOUGH is Executive Vice President of McGough Construction
Company, Inc., a Minnesota commercial contractor. Mr. McGough was one of the
incorporators of McGough Construction Company. Mr. McGough has been a director
of TCF Financial since 1989.
RONALD A. WARD is certified by the American Board of Oral Surgery and is a
retired associate of Oral and Maxillofacial Surgery Associates of Waukesha, Ltd.
Dr. Ward had been a director of Republic Capital Group, Inc. ("RCG") from 1987
and of Republic Capital Bank, F.S.B. from 1981 until TCF's acquisition of RCG in
1993. Dr. Ward has been a director of TCF Financial since 1993.
BRUCE G. ALLBRIGHT was President and a director of Dayton Hudson
Corporation from 1987 until his retirement in 1990. Before that, he was
Chairman and Chief Executive Officer of Dayton Hudson Corporation's largest
division, Target Stores, since 1984 and was the President and Vice Chairman of
that division prior to that date. Mr. Allbright is also a director of G&K
Services, Inc., Hannaford Brothers Company, and Noma Industries. Mr. Allbright
has been a director of TCF Financial since its formation in 1987.
ROBERT J. DELONIS is Chairman of the Board and Chief Executive Officer of
Great Lakes Bancorp. Mr. Delonis has been a director of Great Lakes Bancorp
since 1987 and of TCF Financial since February 1995. He is Vice Chairman of the
Michigan League of Savings Institutions, Chairman of Catholic Social Services of
Washtenaw County, a past director of the Federal Home Loan Bank of Indianapolis
and past Chairman of the Thrift Industry Accounting Committee. He has also
served as an instructor in real estate finance in the Graduate School of
Business Administration at the University of Michigan. Mr. Delonis is a
Certified Public Accountant.
JOHN M. EGGEMEYER, III is President of Belle Plaine Partners, Inc. and has
held that position since February 1990. In addition, he served as a managing
director of Mabon Securities Corp., Inc. from April 1992 to December 1994. He
also serves as a director of Household Personal Portfolios and The Combined
Fund, Inc. He has been a director of TCF Financial since October 1994 and TCF
Bank Illinois fsb ("TCF Bank Illinois") since 1993.
DANIEL F. MAY is retired from various executive positions with Republic
Airlines. Mr. May has been a director of TCF Financial since 1988. Mr. May is
a Certified Public Accountant.
ROY E. WEBER is the former Chairman of the Board of Great Lakes Bancorp.
Mr. Weber has been a director of Great Lakes Bancorp since 1967 and of TCF
Financial since February 1995. He is a past Chairman of the Michigan League of
Savings Institutions and past Vice Chairman and director of the Federal Home
Loan Bank of Indianapolis.
TCF BOARD ACTIONS AND COMMITTEES. The business, property and affairs of
TCF Financial are managed by or under the direction of the Board. The Board has
established Audit, Personnel/Affirmative Action and Shareholder Relations
Committees. During 1994 these committees of the Board held three, six and two
meetings, respectively. In 1994 the Board met ten times. Each director
attended at least 75% of the total number of meetings of the Board and of
committees on which the director served.
The Audit Committee is responsible for relations with TCF Financial's
internal auditor and independent public accountants, for review of internal
auditing functions and controls, and for review of financial reporting policies
to assure full disclosure of financial condition and results of operations. The
members of the Audit Committee are Messrs. May, McGough, Allbright and Ward.
7
<PAGE>
The Personnel/Affirmative Action Committee is responsible for approving and
reporting to the Board on those items delegated to it by the full Board, and to
recommend a course of action for those human resource issues requiring full
Board approval. This Committee approves affirmative action plans and reviews
the adequacy and effectiveness of benefit programs. The Personnel/Affirmative
Action Committee also serves as the independent committee which administers and
makes awards under the Stock Option and Incentive Plan of TCF Financial as well
as certain other plans. Its members also serve as the Advisory Committee of the
TCF Employees Stock Ownership Plan-401(k), which has authority to direct the
voting of shares of TCF Common Stock held by the plan to the extent participants
in that plan do not furnish voting instructions. The members of the
Personnel/Affirmative Action Committee are Messrs. May, Allbright, Strangis and
Ms. Goldberg.
The Shareholder Relations Committee reviews merger and acquisition
activities and policies and evaluates alternatives available to TCF Financial to
enhance shareholder value. The members of the Shareholder Relations Committee
are Messrs. May, Allbright and Strangis.
NOMINATION OF TCF DIRECTORS. The Board acts as a nominating committee for
selecting the nominees of the Board for election as directors. The Bylaws of
TCF Financial (the "Bylaws") require that stockholder nominations for director
be made pursuant to timely notice in writing to the Secretary of TCF Financial.
To be timely, notice must be delivered to or mailed and received by the
Secretary of TCF Financial not less than 60 days nor more than 90 days prior to
an annual meeting; provided, however, that if less than 70 days' notice or prior
public disclosure of the date of the meeting is given or made to stockholders,
notice, to be timely, must be received by the Secretary not later than the close
of business on the tenth day following the earlier of the day on which notice of
the date of the meeting was mailed or on the day on which public disclosure of
the date of the meeting was made. A stockholders' notice of nomination must set
forth certain information specified in Article II, Section 13, of the Bylaws
concerning each person the stockholder proposes to nominate for election and the
stockholder giving such notice. The Bylaws provide that no person shall be
elected as a director unless nominated in accordance with the procedures set
forth in the Bylaws. Public disclosure of the date of the 1995 Annual Meeting
was made on February 8, 1995 by distribution of a news release. Under the
Bylaws, stockholder nominations of directors for the 1995 Annual Meeting were
required to have been received on or before February 18, 1995 in order to be
timely, and no such nominations were received by TCF Financial by that time.
Robert J. Delonis, Mark K. Rosenfeld and Roy E. Weber were elected
directors of TCF Financial in February 1995 in connection with the merger of
Great Lakes Bancorp into a subsidiary of TCF Financial pursuant to the terms of
the Agreement and Plan of Reorganization dated September 8, 1994 (the "Merger
Agreement") by and between TCF Financial and Great Lakes Bancorp. Messrs.
Delonis and Weber's terms as directors are scheduled to expire in 1997. Mr.
Rosenfeld's term as director is scheduled to expire in 1995 and pursuant to the
Merger Agreement, Mr. Rosenfeld is nominated for re-election as a director for a
term expiring in 1998. For as long as Mr. Delonis is employed by TCF Financial,
TCF Financial will use its best efforts (subject to the discharge of fiduciary
duties by its directors) to nominate and re-elect Mr. Delonis as a director.
TCF EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS OF TCF FINANCIAL
The following table sets forth certain information with respect to the
executive officers of TCF Financial, or its principal wholly owned subsidiaries
TCF Bank Minnesota, TCF Bank Illinois, TCF Bank Wisconsin fsb ("TCF Bank
Wisconsin"), and Great Lakes Bancorp, who are not directors of TCF Financial.
8
<PAGE>
<TABLE>
<CAPTION>
Name Age Principal Positions Held
---- --- ------------------------
<S> <C> <C>
Timothy P. Bailey. . . 39 President and Chief Executive Officer of TCF Bank
Wisconsin
Peter Bell . . . . . . 43 Executive Vice President of TCF Bank Minnesota
William E. Dove. . . . 58 Executive Vice President of TCF Bank Minnesota
Michael B. Johnstone . 47 President and Chief Executive Officer of TCF Bank
Illinois
Mark R. Lund . . . . . 44 Senior Vice President, Assistant Treasurer and
Controller (Principal Accounting Officer) of TCF
Financial
Lynn A. Nagorske . . . 38 President, Chief Operating Officer and Treasurer
(Principal Financial Officer) of TCF Financial
Ronald J. Palmer . . . 42 Executive Vice President of TCF Bank Minnesota
Gregory J. Pulles. . . 46 General Counsel, Vice Chairman and Secretary of TCF
Financial
Mary E. Sipe . . . . . 38 Executive Vice President of TCF Financial
James E. Tuite . . . . 59 Executive Vice President of TCF Financial; President
and Chief Operating Officer of TCF Bank Minnesota
Neil I. Whitehouse . . 55 Executive Vice President of TCF Bank Minnesota
Barry N. Winslow . . . 47 President and Chief Operating Officer of Great Lakes
Bancorp
</TABLE>
The business experience of each of these executive officers during the last five
years is as follows:
TIMOTHY P. BAILEY was named President and Chief Executive Officer of TCF
Bank Wisconsin in 1993. Prior to that Mr. Bailey had been Vice President of
Commercial Lending/Loan Workouts with TCF Bank Minnesota since 1988.
PETER BELL was named an Executive Vice President of TCF Bank Minnesota in
1994. Prior to that Mr. Bell was an independent consultant for more than five
years. Mr. Bell also serves on the Board of Directors of the Center for the
American Experiment, CommonBond, Citizens League, and the Johnson Institute. He
is also a director and President of TC Rise and the National Institute for
Traditional Black Leadership.
WILLIAM E. DOVE has been an Executive Vice President of TCF Bank Minnesota
since 1985 and the director of Commercial Lending of TCF Bank Minnesota since
1993.
MICHAEL B. JOHNSTONE was elected President and Chief Executive Officer of
TCF Bank Illinois in February 1995. From 1987 to January 1995 he was employed
by TCF Bank Minnesota as Senior Vice President of Branch Operations.
MARK R. LUND was elected a Senior Vice President of TCF Financial in 1994.
He has been Assistant Treasurer and Controller (Principal Accounting Officer) of
TCF Financial and Assistant Treasurer of TCF Bank Minnesota since 1991 and a
Senior Vice President and Controller of TCF Bank Minnesota since 1987. Mr. Lund
is a Certified Public Accountant.
LYNN A. NAGORSKE has been the Treasurer (Principal Financial Officer) of
TCF Financial since its formation in 1987 and was elected President and Chief
Operating Officer of TCF Financial in 1993. Mr. Nagorske has been an Executive
Vice President of TCF Bank Minnesota since 1988 and Treasurer and Chief
Financial Officer since 1987. Mr. Nagorske is a Certified Public Accountant.
9
<PAGE>
RONALD J. PALMER was elected an Executive Vice President of TCF Bank
Minnesota and President and Chief Executive Officer of TCF Mortgage Corporation
in 1992. Prior to that he was Senior Vice President of Citicorp Mortgage, Inc.
in St. Louis, Missouri since 1986. Mr. Palmer is a Certified Public Accountant.
GREGORY J. PULLES has been General Counsel of TCF Financial since its
formation in 1987 and Secretary of TCF Financial since 1989. He was elected a
Vice Chairman of TCF Financial in 1993. Mr. Pulles has been Secretary and
Executive Vice President of TCF Bank Minnesota since 1989. He was also General
Counsel of TCF Bank Minnesota from 1985 until 1993.
MARY E. SIPE has been an Executive Vice President of TCF Financial since
1993. Ms. Sipe has been President of TCF Financial Insurance Agency, Inc. and
TCF Financial Insurance Agency Illinois, Inc. since 1989, President of TCF
Financial Insurance Agency Wisconsin, Inc. since 1993 and President of TCF
Financial Insurance Agency Michigan, Inc. since January 1995.
JAMES E. TUITE was elected an Executive Vice President of TCF Financial in
1993. Prior to that he was a Vice President since 1992. He was elected
President and Chief Operating Officer of TCF Bank Minnesota in 1993. Prior to
that he was an Executive Vice President of TCF Bank Minnesota.
NEIL I. WHITEHOUSE is President of TCF Foundation and an Executive Vice
President of TCF Bank Minnesota. Mr. Whitehouse was Secretary of TCF Financial
until 1989.
BARRY N. WINSLOW was elected President and Chief Operating Officer of Great
Lakes Bancorp in February 1995. Prior to that he had been President and Chief
Executive Officer of TCF Bank Illinois since 1993. Prior to that he was
President of TCF Bank Minnesota - Illinois Division and a Senior Vice President
of TCF Bank Minnesota since 1987.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
TCF's directors and executive officers and all persons who beneficially own more
than 10% of the outstanding shares of TCF Common Stock to file with the
Securities and Exchange Commission ("SEC") and the New York Stock Exchange
("NYSE") initial reports of ownership and reports of changes in ownership of TCF
Common Stock. Executive officers, directors and greater than 10% beneficial
owners are also required to furnish TCF with copies of all Section 16(a) forms
they file. To TCF's knowledge, based upon a review of the copies of such
reports furnished to TCF and written representations that no other reports were
required, during the fiscal year ended December 31, 1994, all Section 16(a)
filing requirements applicable to TCF's directors, executive officers and
greater than 10% beneficial owners were satisfied.
SECURITIES OWNERSHIP OF TCF DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT
STOCKHOLDERS
The following table sets forth information, as of March 1, 1995 (except as
otherwise indicated), regarding the beneficial ownership of TCF Common Stock,
which is the only class of voting equity securities outstanding, by each
director or nominee for director of TCF Financial and each of the executive
officers named on the Summary Compensation Table (the "named executives"), by
all such directors, nominees and executive officers of TCF Financial, and its
significant subsidiaries ("executive officers") as a group, and by each person
(including any "group" as defined in Section 13(d)(3) of the Securities Exchange
Act of 1934) who is known to TCF Financial to be the beneficial owner of more
than 5% of the outstanding common stock of TCF Financial.
10
<PAGE>
<TABLE>
<CAPTION>
Name of Beneficial Owner Shares Beneficially Owned(1) % of Shares Outstanding (2)
------------------------ ---------------------------- ---------------------------
<S> <C> <C>
Directors and Nominees who are
not Named Executives:
Bruce G. Allbright 37,628 (4)(7) (3)
Rudy Boschwitz 3,000 (3)
Robert J. Delonis 84,389 (4)(5)(6) (3)
John M. Eggemeyer, III 2,260 (3)
Luella G. Goldberg 10,233 (4)(7) (3)
Daniel F. May 29,415 (4)(7) (3)
Thomas J. McGough 13,000 (4) (3)
Mark K. Rosenfeld 1,783 (4) (3)
Ralph Strangis 8,500 (7) (3)
Ronald A. Ward 60,909 (3)
Roy E. Weber 74,294 (3)
------
325,411 1.85%
Named Executives:
William A. Cooper 402,650 (4)(5)(6) 2.29%
Joseph P. Clifford 130,173 (5)(6) (3)
Thomas A. Cusick 109,192 (5)(6) (3)
Robert E. Evans 130,838 (4)(5)(6) (3)
James E. Tuite 146,623 (5)(6) (3)
-------
919,476 5.23%
All Directors and
Executive Officers combined (28
persons, including those named above) 1,588,458 (4)(5)(6)(7) 9.03%
Other beneficial owners:
Advisory Committee of TCF
Employees Stock Ownership
Plan-401(k)
(as of 12/31/94) 1,057,219 (7) 6.01%
c/o General Counsel,
TCF Financial Corporation
801 Marquette Avenue,
Suite 302
Minneapolis, MN 55402
________________________
Notes to Securities Ownership Table appear on following page.
11
<PAGE>
<FN>
(1) All shares are directly owned or exercisable in 60 days, and the person
indicated has sole or shared (joint account) voting and dispositive power,
except as indicated in the following footnotes. In addition to shares
beneficially owned, executive officers held 8,319 options not exercisable within
60 days of March 1, 1995 for an additional .05% of the outstanding common stock
of TCF Financial. When added to shares of TCF Common Stock held by the TCF
Employees Stock Ownership Plan-401(k) (as of January 31, 1995) and TCF Cash
Balance Pension Plan as of such date not otherwise included on this table, and
treating all shares issuable upon exercise of options held by executives as
outstanding and owned, the total percentage of shares owned by directors,
executive officers and employee benefit plans at March 1, 1995 was 19.10%.
(2) Each amount showing the percentage of outstanding shares owned beneficially
has been calculated by treating as outstanding and owned the shares which could
be purchased by the indicated person upon exercise of existing options within 60
days after March 1, 1995.
(3) 1.0% or less.
(4) Includes shares beneficially owned by family members who share the person's
household, with respect to which shares the indicated person disclaims any
beneficial ownership, as follows: Mr. Allbright, 10,200 shares; Mr. Delonis,
3,373 shares; Ms. Goldberg, 1,400 shares; Mr. May, 450 shares; Mr. McGough,
10,000 shares; Mr. Rosenfeld, 458 shares; Mr. Cooper, 1,060 shares; Mr. Evans,
665 shares; and all directors, nominees and executive officers combined, 33,948
shares.
(5) Includes shares which could be purchased upon exercise of existing options
within 60 days as follows: Mr. Cooper, 21,878 shares; Mr. Clifford, 21,733
shares; Mr. Cusick, 1,600 shares; Mr. Evans, 16,700 shares; Mr. Tuite, 26,133
shares; and Mr. Delonis, 3,315 shares; and all directors, nominees and executive
officers combined, 185,228 shares.
(6) Includes whole shares of TCF Common Stock (vested and unvested) allocated
to accounts as of January 31, 1995 in the TCF Employees Stock Ownership
Plan-401(k), for which the named executives have shared voting power, as
follows: Mr. Cooper, 11,447 shares; Mr. Clifford, 7,610 shares; Mr. Cusick,
8,275 shares; Mr. Evans, 5,891 shares; Mr. Tuite, 7,478 shares; and all
directors, nominees and executive officers combined, 88,723 shares. Also
includes whole shares of TCF Common Stock in the trust for the TCF Financial
Executive Deferred Compensation Plan, for which the named executives have shared
dispositive power, as of March 1, 1995, as follows: Mr. Cooper, 159,685 shares;
Mr. Clifford, 39,915 shares; Mr. Cusick, 45,128 shares; Mr. Evans, 53,868
shares; Mr. Tuite, 51,599 shares; Mr. Delonis, 33,333 shares; and all directors,
nominees and executive officers combined, 467,600 shares.
(7) The Advisory Committee for the TCF Employees Stock Ownership Plan-401(k)
has shared voting power with participants of all allocated shares in the Plan.
Advisory Committee members disclaim ownership of these shares. Information on
the table as to shares beneficially owned by Ms. Goldberg, and Messrs. May,
Allbright and Strangis does not include any shares beneficially owned by the
Advisory Committee.
</TABLE>
EXECUTIVE COMPENSATION
The following summary compensation table (the "Summary Compensation Table")
sets forth the cash and noncash compensation for each of the last three fiscal
years awarded to or earned by the Chief Executive Officer of TCF and the four
highest paid executives of TCF whose salary and bonus earned in 1994 exceeded
$100,000. The term "LTIP" refers to Long-Term Incentive Plans.
12
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
------------------- ----------------------
Awards Payouts
--------------------------------------------------------------
Securities
Restricted Stock Underlying All Other
Name and Salary Bonus Awards Options LTIP Payouts Compensation
Principal Position* Year ($)(a) ($)(a) ($)(d) (#) ($)(c) ($)
- - -------------------------------------------------------------------------------------------------------------------------------
- - -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
William A. Cooper, 1994 $500,006 $362,504 $1,290,000(b) 0 $271,517 22,253(e)
Director, Chairman of 1993 500,006 0 85,383(b) 0 128,811 33,060
the Board and Chief 1992 462,020 0 126,389(b) 0 0 22,867
Executive Officer
Thomas A. Cusick, 1994 298,066 217,500 806,250(b) 0 79,992 10,573(e)
Director and Vice Chairman; 1993 250,008 28,126 26,215(b) 0 36,808 14,363
Director, Vice Chairman and 1992 206,242 21,995 36,115(b) 0 0 10,254
Chief Executive Officer of
TCF Bank Minnesota
Joseph P. Clifford, 1994 220,008 159,506 483,750(b) 0 75,795 7,961(e)
Director and Vice Chairman 1993 220,008 24,751 23,061(b) 0 36,808 11,973
1992 206,242 21,995 36,115(b) 0 0 9,998
Robert E. Evans, 1994 220,008 159,506 483,750(b) 0 73,513 8,029(e)
Director and Vice Chairman 1993 220,008 22,919 21,346(b) 0 36,808 12,128
1992 206,242 21,995 36,115(b) 0 0 9,877
James E. Tuite, Executive 1994 200,004 250,005 483,750(b) 0 54,687 7,220(e)
Vice President; President and 1993 200,004 31,587 20,948(b) 0 21,879 11,968
Chief Operating Officer of 1992 182,192 46,293 21,467(b) 0 0 9,199
TCF Bank Minnesota
<FN>
* At December 31, 1994.
</TABLE>
NOTES TO SUMMARY COMPENSATION TABLE:
(a) Salary shown is for the year in which it was earned. Bonuses are shown
for the year in which they were earned. The bonus reported for 1994 (paid in
January 1995) was paid entirely in cash and based on the ROA of TCF Financial
(or in the case of Mr. Tuite, TCF Bank Minnesota. (See "Incentive Compensation"
in the "Report of TCF Personnel/Affirmative Action Committee on Executive
Compensation"). Bonuses reported for 1992 and 1993 involved a combination of
cash and stock grants in lieu of cash. Awards were based on the achievement of
specified goals on credit quality, capital and regulatory rating and upon
performance relative to individual, profit center and cost control goals or, for
Mr. Cooper, a pre-tax earnings goal. Bonuses awards paid in TCF Common Stock in
1992 or 1993 which were not subject to future performance-based vesting
requirements are reported in the Restricted Stock Awards column.
(b) The 1994 restricted stock grants were awarded effective March 21, 1994,
and are to vest or be forfeited over a period of four to five years from the
effective date. Vesting of shares is contingent upon TCF meeting certain
performance goals. The shares for which the restricted period shall expire on
January 1, 1998 is calculated on the basis of the return on average common
equity ("ROE") of TCF Financial for each of the fiscal years ending on December
31,1994, 1995, 1996, and 1997, and the following chart:
TCF ROE: Vesting: Shares Forfeited:
-------- -------- -----------------
Less than 15.0% 0% 20% of shares
15.0% to 16.5% 20%
16.6% to 17.5% 25%
17.6% or more 33%
The percentage of shares for which a restricted period ends on January 1, 1999,
(if the percentage for January 1, 1998 is less than 100%) shall be calculated by
determining the ROE of TCF for the fiscal year ending December 31, 1998 and
determining the corresponding percentage for such year from the foregoing chart.
In the event that TCF's ROE is less than 15% in 1998, such remaining shares
shall be forfeited and returned to TCF.
For 1993 and 1992, the restricted stock reported is one-third of the bonus stock
awards made on January 24, 1994 and January 25, 1993, respectively, valued at
the market value (average of high and low prices) of TCF Common Stock on the
date of grant.
(c) The 1994 amount represents one-third of the bonus stock awards made in
January 1993 and January 1994 which vested on January 1, 1995 valued at the
market value (average of high and low prices) of TCF Common Stock on December
31, 1994. The 1993 amount represents one-third of the bonus stock awards made
in January 1993 which vested on January 1, 1994, valued in the same manner as of
December 31, 1993.
13
<PAGE>
(d) Summary of restricted (unvested) stock holdings at December 31, 1994 (these
shares are included in the Securities Ownership Table and in the Restricted
Stock Awards column shown on the Summary Compensation Table):
# of Restricted Value at
Name Shares Held December 31, 1994*
---- --------------- -----------------
William A. Cooper 61,591 $2,540,628.75
Thomas A. Cusick 34,980 1,442,925.00
Joseph P. Clifford 24,775 1,021,968.75
Robert E. Evans 24,663 1,017,348.75
James E. Tuite 25,010 1,031,662.50
* Based on the closing market price of TCF Common Stock at December 31,
1994 of $41.25 per share.
The number of restricted shares held includes shares awarded under
long-term incentive performance plans. Dividends are paid, at the regular
rate for TCF Common Stock, on all shares of restricted stock outstanding.
(e) Represents defined contribution plan (401-(k) supplemental) employer
contributions, forfeitures and dividend allocations during 1994 as follows: Mr.
Cooper, $18,737; Mr. Cusick, $10,573; Mr. Clifford, $7,961; Mr. Evans, $8,029;
and Mr. Tuite, $7,220; and insurance premiums paid for Mr. Cooper in 1994 of
$3,516.
GRANT OF OPTIONS AND STOCK APPRECIATION RIGHTS DURING 1994. There were no
stock option grants in 1994 to Mr. Cooper or the other executives named in the
Summary Compensation Table. TCF has not at any time awarded Stock Appreciation
Rights ("SAR's"), therefore there are no SAR's outstanding.
OPTION EXERCISES IN 1994 AND VALUE OF OUTSTANDING OPTIONS AT DECEMBER 31,
1994. The following table shows stock options that were exercised during 1994
by the five executives named on the Summary Compensation Table and the number
and value of options still held at December 31, 1994. The value of options
exercised during the year is determined as the difference between the market
value of TCF Common Stock and the exercise price of the option on the date of
exercise. The value of unexercised options is determined as the difference
between the market value of TCF Common Stock and the exercise price at the end
of 1994.
OPTION EXERCISES IN 1994 AND VALUE OF OUTSTANDING
OPTIONS AT DECEMBER 31, 1994
<TABLE>
<CAPTION>
Shares Number of Securities
Acquired Underlying Unexercised Value of Unexercised
on Value Options at In-The-Money Options at
Exercise Realized December 31, 1994 (#): December 31, 1994 ($):
Name (#) ($) Vested/Unvested Vested/Unvested
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
William A. Cooper 4,961 98,277 16,878/5,000 491,679/140,950
Thomas A. Cusick 4,300 82,304 0/1,600 0/45,104
Joseph P. Clifford 0 0 20,133/1,600 584,690/45,104
Robert E. Evans 0 0 15,100/1,600 456,854/45,104
James E. Tuite 5,700 139,308 24,853/1,680 767,522/50,303
</TABLE>
REPRICING OF OUTSTANDING STOCK OPTIONS. TCF has not at any time engaged in
the repricing of stock options.
LONG-TERM INCENTIVE PLAN AWARDS FOR THE YEAR ENDED DECEMBER 31, 1994.
There were no long-term incentive plan awards in 1994.
TCF FINANCIAL EXECUTIVE DEFERRED COMPENSATION PLAN AND SENIOR OFFICER
DEFERRED COMPENSATION PLAN. TCF has two plans which offer eligible executives
an opportunity to defer payment of all or a portion of their incentive
compensation, if any, and up to 30% of their yearly salary, until termination of
employment. Employees eligible to participate in the Executive Deferred
Compensation Plan (the "Executive Deferred Plan") are employees of TCF Financial
and its affiliates who are considered "executive officers" subject to reporting
requirements under Section 16(a) of the Securities Exchange Act of 1934,
including the five named
14
<PAGE>
executives. Deferrals of salary or incentive compensation are credited to a
separate deferred compensation account for each participating employee
maintained by each participating employer which is credited with earnings or
losses measured by the earnings or losses of investments deemed to be selected
by the employee. TCF Financial and the other participating employers have also
established a trust to accumulate assets for payment of liabilities as under the
Executive Deferred Plan when they come due and contributed to it amounts equal
to the amounts employees have deferred from their compensation. The trustee
invests the assets of the trust in the same manner as the deemed investments of
the Executive Deferred Plan in order to match the trust's assets as closely as
possible to the liabilities of the Executive Deferred Plan. The trustee is
authorized to borrow funds from TCF Financial in addition to unaffiliated
lending institutions. All loans undertaken by the trustee are required to be
adequately secured, to be approved in advance by the Personnel/Affirmative
Action Committee of the Board and do not exceed such amounts as may be
reasonably anticipated to be repaid out of deferrals of compensation by
participants of the Executive Deferred Plan. The Executive Deferred Plan and
trust provide that TCF Financial and the employers will in no event be liable
for repayment of any loans undertaken by the trustee. Distributions from the
Executive Deferred Plan will commence within 30 days after the employee's
termination of employment, and will generally be paid over a period of 15 years
after termination of employment. Employees eligible for the Senior Officer
Deferred Compensation Plan are generally employees of TCF Financial or any of
its direct or indirect subsidiaries who hold the office of President or
Executive Vice President of a subsidiary bank or President of a direct or
indirect subsidiary of TCF Financial. The Senior Officer Plan is the same as
the Executive Deferred Plan, except that borrowing is not permissible in the
Senior Officer Deferred Plan.
THE TCF CASH BALANCE PENSION PLAN. The TCF Cash Balance Pension Plan (the
"Pension Plan") was adopted effective September 1, 1990, by the Board of
Directors of TCF Bank Minnesota as an amendment and restatement of a predecessor
plan, which had been in effect for the benefit of eligible employees since July
1, 1947. Benefits accrued before September 1, 1990 under various formulas, with
the last such formula providing a benefit at retirement equal to 50% of final
average pay reduced by 50% of Social Security benefits, pro-rated based on
service. Participants in the Pension Plan since its amendment in 1990 to a
"cash balance" formula receive monthly allocations to their accounts in the
Pension Plan equal to a percentage of covered pay that year determined on the
basis of each participant's age plus years of service. The allocation
percentages range from 2.5% to 7.5%. Accounts are credited with interest
quarterly at a rate tied to 30-year Treasury notes. The benefit for each
participant is the sum of monthly accrued benefit (if any) at September 1, 1990
under the prior pension plan formula (which was "frozen" at September 1, 1990
and does not increase based on compensation or years of service after that date)
and the monthly benefit accrued thereafter under the cash balance formula. In
addition to the Pension Plan, the executives named in the Summary Compensation
Table participate in a Supplemental Employee Retirement Plan ("SERP") which
remedies certain specified limitations on benefits that can be provided through
the Pension Plan to executives. The benefits provided under the SERP are equal
to the benefits that would be provided under the Pension Plan in the absence of
limitations under Sections 401(k)(3) and 401(m)(2), 414(s), 415, 402(g),
401(a)(5), 401(a)(17) of the Internal Revenue Code (the "Code"), reduced by
benefits actually provided under the Pension Plan. Also, two of the executives
named in the table have individual supplemental pension agreements which provide
benefits based on the prior pension plan formula, and, for one executive,
provides him with access to retiree medical coverage. The annual annuity
benefit payable starting at normal retirement age (age 65) as accrued through
December 31, 1994 under the Pension Plan, the SERP, and the supplemental
agreements for the executives named in the Summary Compensation Table is as
follows: Mr. Cooper, $54,940; Mr. Cusick, $24,751; Mr. Clifford, $22,779 ; Mr.
Evans, $69,304 and Mr. Tuite, $53,838.
CHIEF EXECUTIVE OFFICER EMPLOYMENT AGREEMENT. TCF Financial and TCF Bank
Minnesota entered into an employment agreement with William A. Cooper effective
July 1, 1993, for a term of three years. This agreement supersedes a prior
employment agreement between the companies and Mr. Cooper which expired on June
30, 1993. The agreement is for a period to and including June 30, 1996, or
until Mr. Cooper's earlier removal, death or permanent disability. The
agreement provides for a base salary of not less than $500,000 annually. In the
event of Mr. Cooper's removal "without cause" (as defined in the agreement), and
not due to death or disability, his salary, incentive pay and benefits will
continue through the end of his term of employment under the agreement. If,
however, a termination without cause occurs within the last twelve months of the
contract, Mr. Cooper's salary and benefits will continue for an extended period
of twelve months from the date of such termination. If Mr. Cooper's employment
is not continued by TCF Financial after June 30, 1996, unless for "cause" (as
defined), a termination of employment without cause is deemed
15
<PAGE>
to occur, resulting in continuation of his salary, incentive pay and benefits
for twelve months after June 30, 1996. Receipt of continued payments after such
a termination is contingent on compliance with certain noncompetition and
nonsolicitation provisions of the agreement. Mr. Cooper's employment agreement
also includes certain severance arrangements in the event of a termination of
employment without cause (as defined) within 24 months after a change in control
(as defined). The amount of payments is the same as for other executives (see
"Change in Control and Termination Arrangements") except that the limitation on
payments in excess of the 299% limitation in Section 280G of the Code is subject
to an exception in the event Mr. Cooper's base salary multiplied by three
exceeds that limitation, which it currently does not.
CHANGE IN CONTROL AND TERMINATION ARRANGEMENTS. The Personnel/Affirmative
Action Committee and the Board have adopted special severance agreements with
ten executive officers, including Mr. Cooper. In the case of Mr. Cooper, this
agreement is included in his employment contract, which was renegotiated
effective July 1, 1993, for a three-year term (see "Chief Executive Officer
Employment Agreement"). The severance agreements for executives other than Mr.
Cooper take effect in the event of a change in control of TCF Financial and
provide payments to the executive in the event of a termination of employment
within 18 months after the change in control and other than on account of death,
disability, cause (as defined) or voluntary resignation (as defined). The
agreements generally provide for payment of a lump sum equal to two times the
executive's annual compensation plus the value of stock options and restricted
stock forfeited as a result of the termination of employment, as well as
continuation of medical, group life and group long-term disability plans for 24
months at the same cost to the executive as for an active employee. In the
event TCF Bank Minnesota is not in compliance with its minimum regulatory
capital requirements as of the time lump-sum payments would be made, the amount
of the lump-sum payment is reduced to one-times average annual compensation.
Payments under these executive agreements are limited, however, so as not to
exceed 299% of average compensation as defined for purposes of "parachute"
provisions of Section 280G of the Code. If the employment of the executives
named in the Summary Compensation Table had been terminated on December 31, 1994
pursuant to a change in control of TCF, the named executives would have been
entitled to receive the following amounts: Mr. Cooper, $2,992,000; Mr. Cusick,
$1,530,000; Mr. Clifford, $1,136,000; Mr. Evans, $1,257,000; and Mr. Tuite,
$996,000.
COMPENSATION OF TCF DIRECTORS
In 1994 each non-employee director ("outside director") who served on the
boards of both TCF Financial and TCF Bank Minnesota was entitled to a total cash
retainer fee for service on both boards of $20,000 per year and a fee of $700
for each board meeting attended and $300 for each committee meeting attended
($500 for committee chairpersons) of TCF Financial and a fee of $300 for each
board meeting attended and $150 for each committee meeting attended ($300 for
committee chairpersons) of TCF Bank Minnesota. If, however, the Audit
Committees of TCF Financial and TCF Bank Minnesota, or the Personnel/Affirmative
Action Committees of TCF Financial and TCF Bank Minnesota, met on the same day
the total fee due to a director for both committee meetings was only the fee for
a meeting of the TCF Financial committee.
The foregoing cash fees for directors will be the same in 1995, except that
for those directors who serve as director of a subsidiary bank additional
meeting fees at the rate paid by the bank will be received. In addition, in
October 1991 a program was approved (and renewed in 1994) under which 500 shares
of TCF Common Stock are distributed to each outside director after each fiscal
year in which TCF Financial's return on tangible equity ("ROTE") exceeds 13.5%.
Pursuant to this program, shares were distributed in January 1995 because TCF's
ROTE exceeded the stated percentage in 1994.
Directors are allowed to defer payment of any or all cash fees until
retirement from the Board, with interest credited at the six-month Treasury bill
rate. A plan has been adopted (and is submitted for stockholder approval in
proposal 5 of this Annual Meeting) which provides that deferred fees will be
invested in TCF Common Stock. A retirement benefit is provided for outside
directors with five or more years of service on the Board (including service
with TCF Bank Minnesota). For five through nine years of service, the
retirement benefit is 10% per year of service of the base fee paid in the last
year of service as a director, and it is paid for a period equal to the
director's years of service. For directors with ten or more years of service,
the retirement benefit is equal to the full amount paid as a base fee in the
director's last year on the Board and it is paid for a period equal to the
director's years of service.
16
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Personnel/Affirmative Action Committee in 1994 were
Daniel F. May, Bruce G. Allbright, Luella G. Goldberg and Ralph Strangis. None
of these individuals is an executive officer, employee or former employee of
TCF. The law firm of Kaplan, Strangis and Kaplan, P.A. of which Mr. Strangis is
a member, was retained by and rendered service to TCF Financial in 1994, for an
amount which was not greater than 5% of TCF Financial's or the firm's annual
gross revenues. TCF believes that the terms and conditions of its relationship
with Kaplan, Strangis and Kaplan, P.A. is as favorable as those that could be
obtained from arm's length negotiations with unassociated third parties.
REPORT OF TCF PERSONNEL/AFFIRMATIVE ACTION COMMITTEE ON EXECUTIVE COMPENSATION
The Personnel/Affirmative Action Committee of the Board (the "Committee")
is comprised entirely of directors who are not and have not at any time in the
past been executive officers of TCF or any subsidiary of TCF. The Committee is
responsible for ensuring that compensation for executives is consistent with the
stated compensation philosophy of TCF, for recommending executive compensation
proposals to the Board for approval and for awarding stock options and
restricted stock grants.
The general process by which the Committee makes executive compensation
decisions is as follows: The Committee annually evaluates the performance of
TCF's Chief Executive Officer, William A. Cooper, and the other four executives
named in the Summary Compensation Table. The Committee considers and approves
salary, incentive programs and stock awards for a given year in December of the
preceding year and in January of that year. The final deliberations prior to
setting annual salaries and awarding incentives are made without the presence of
Mr. Cooper or any other affected executives, and may or may not include
consultation with an independent professional consultant, according to what the
Committee determines is appropriate. In determining what to approve, the
Committee takes into account results of a peer group study provided to the
Committee in June of each year, proposals from the Chief Executive Officer,
opinions of an independent professional consultant (if requested), the TCF
Compensation Philosophy set forth later in this report and any other pertinent
information which is brought before it. The peer group used in this study is
the same as the peer group in the TCF Comparative Stock Performance chart that
is included in this Proxy Statement. The Committee does not assign specific
weights to or otherwise specifically use measures of corporate performance when
designing or approving executive compensation arrangements, but it does consider
the overall level of executive compensation and performance of TCF relative to
its peer group.
The peer group study the Committee received in June 1993, which was taken
into account in setting 1994 executive compensation, indicated that TCF's
performance ranked first (highest) in the peer group while TCF's total executive
compensation ranked 11th (near the bottom) in the peer group. Notwithstanding
this disparity, the Committee intends in general that the level of executive
compensation will correspond to the level of performance. The Committee
incorporates specific measures of corporate performance in the incentive
arrangements and stock awards for executives, as described later in this Report.
The Committee and Board have adopted a Compensation Philosophy and have designed
the compensation system around this philosophy. The Compensation Philosophy is
as follows:
1. TCF believes that the compensation system should attract and retain
experienced, highly qualified bankers.
2. TCF believes in pay for performance based on specific written
financial goals and objectives. Total executive compensation should
have a large component of incentive compensation based on performance.
Incentive compensation should be at risk, i.e., payment should be
based on performance.
3. TCF believes that executive compensation should have both a short-term
(annual) and a long-term orientation, both as to the amount and form
of payment.
4. TCF believes that executive compensation levels should be measured by
a comparison to peers as well as other factors such as specific
individual contributions.
17
<PAGE>
5. TCF believes that the overall compensation level of TCF Executive
Management should parallel the overall performance of TCF as compared
to its peers, i.e., top performance results in top levels of
compensation, lower performance results in lower levels of
compensation.
6. TCF believes that executive compensation should result in TCF
Executive Management having a significant investment in TCF Common
Stock.
7. TCF believes that the incentive compensation system should be designed
to encourage TCF Executive Management to defer and invest incentive
compensation.
SALARIES. Mr. Cooper's salary is determined under the terms of an
employment contract which allows (but does not require) base salary to be
increased annually. Salaries of the other named executives are reviewed
annually. The Committee does not use any specific business or performance
factors in making annual salary determinations. In determining salaries the
Committee takes into account the results of the peer group study received in
June of the preceding year. The study the Committee reviewed in determining
1994 salaries indicated TCF's performance ranked first in the peer group while
TCF's executive salaries ranked in the middle of the peer group. For 1994, the
Committee did not increase Mr. Cooper's salary or the salary of any other named
executive other than Mr. Cusick, who assumed increased responsibilities.
Starting with the 1994 fiscal year, the Committee approved a long-term
salary/incentive program under which Mr. Cooper and the other named executives
(as well as certain other executives) have the opportunity over a three-year
period from 1994 to 1996 to earn annual incentives and stock grants the amount
of which is based on the return on average assets ("ROA") or the ROE of TCF.
(See INCENTIVE COMPENSATION and RESTRICTED STOCK GRANTS.) In February 1995, TCF
completed a combination with Great Lakes Bancorp. This combination increased
TCF's size by over 50% or approximately $2.5 billion in assets, expanded its
geographic area of operations and substantially increased management's
responsibilities. The Committee considered the increased responsibilities and
impact of the business combination with Great Lakes Bancorp on expected 1995
results in increasing 1995 salaries for four of the five named executives, and
in setting ROA goals for incentive compensation for 1995. The 1995 salaries for
the named executives are: Mr. Cooper $598,079; Mr. Cusick $358,865; Mr.
Clifford $263,157; Mr. Evans $263,157; and Mr. Tuite $200,004. The increased
1995 salaries established for the named executives are expected to remain at the
same level at least through 1996.
INCENTIVE COMPENSATION. The Committee and the Board approved in 1994 a
three-year program under which the incentive compensation of Mr. Cooper and the
other four named executives (as well as certain other executives) is based upon
a two-step process: (1) no incentive will be paid unless specified goals are
achieved relative to credit quality, capital and regulatory rating; and (2) if
these goals are achieved the amount of the incentive ranges from 0% to 125% of
salary depending in each case on the ROA achieved by TCF (or, for Mr. Tuite, the
ROA achieved by TCF Bank Minnesota). ROA is computed based on after-tax
earnings, excluding extraordinary gains and losses and other nonrecurring items,
and adjusted to reflect charges related to mergers and acquisitions, at the
discretion of the Committee, divided by average total assets.
TCF's ROA for 1994 was 1.19%. TCF Bank Minnesota's ROA for 1994 was 1.69%.
The incentives awarded to Mr. Cooper and the other named executives for 1994
performance under the 1994 to 1996 ROA-based incentive plan, expressed as a
percentage of salary, were as follows: Mr. Cooper, 72.5%; Mr. Cusick, 72.5%; Mr.
Clifford, 72.5%; Mr. Evans, 72.5%; and Mr. Tuite, 125%. No targets, goals or
requirements were waived by the Committee in determining the incentive
compensation to be paid. The ROA targets for the named executives were
unchanged for 1995 but salaries were adjusted to take into account the impact of
the combination with Great Lakes Bancorp (see SALARIES earlier in this report).
ROA targets are also established for TCF subsidiary banks in Minnesota,
Illinois, Wisconsin, and Michigan.
RESTRICTED STOCK GRANTS. TCF has not awarded stock options to Mr. Cooper
or any of the other named executives since 1991. The Committee also does not
plan to award any stock options to any of the named executives in the future, as
long as the stock grant program described in the following paragraphs is in
effect.
18
<PAGE>
1994 RESTRICTED STOCK GRANTS. Awards of restricted stock grants were made
to Mr. Cooper and the four other named executives and certain other executives
effective March 21, 1994 in amounts approximately equal in value to three times
their then current salary. The Committee considered, among other factors, the
amount and terms of other restricted stock grants before making these awards.
Specifically, the Committee reviewed the number of shares granted to the
executives under a stock grant program in 1991 and decided to award somewhat
fewer shares in 1994 because the market value of TCF Common Stock had increased
since 1991. The awards were made in consideration of services in 1993 as well
as future services and performance. Vesting of these stock awards will occur in
January 1998, subject in general to continuing employment through that date, in
a percentage determined on the basis of the ROE of TCF for each of the fiscal
years 1994 through 1997, under the following schedule:
<TABLE>
<CAPTION>
TCF's ROE: Vesting: Shares Forfeited:
---------- -------- -----------------
<S> <C> <C>
Less than 15.0% 0% 20% of shares
15.0% to 16.5% 20%
16.6% to 17.5% 25%
17.6% or more 33%
</TABLE>
In the event that any part of the stock award is not vested, and has not
been forfeited, by January 1998, the remainder will vest or be forfeited on
January 1, 1999 under the schedule above, subject in general to continuing
employment through that date. ROE will be computed on the basis of after-tax
earnings, excluding extraordinary gains and losses and other non-recurring items
and adjusted to reflect charges related to mergers and acquisitions, at the
discretion of the Committee, and divided by average total common equity. For
1994, TCF's ROE was 18.65% therefore the vesting percentage achieved for that
year (although actual vesting is delayed until January 1, 1998) under the
foregoing chart was 33%.
SAR/REPRICING OF OPTIONS. The Committee has not awarded any SAR's to date
and has no intention to do so. TCF has also not engaged in any repricing of
options.
COMPENSATION OF MR. COOPER. Mr. Cooper's salary was not increased in 1994
from 1993 but was increased in 1995 from 1994 as a result of the combination
with Great Lakes Bancorp (see SALARIES, earlier in this report). The Committee
has approved an ROA-based incentive program to be in effect throughout 1994 to
1996. Under this incentive program Mr. Cooper may receive annual cash bonuses
of 0% to 125% of base pay, depending on TCF's ROA for each of the years 1994 to
1996. (See INCENTIVE COMPENSATION earlier in this report). Mr. Cooper's bonus
for 1994 was 72.5% of base pay. The amount of his bonus was determined on the
basis of TCF's 1994 ROA performance. No targets, goals or requirements were
waived by the Committee in determining the amount of Mr. Cooper's bonus for
1994. Mr. Cooper was awarded a grant of 40,000 shares of restricted stock
effective as of March 21, 1994, under the 1994 Restricted Stock Grant program
described earlier in this Report. These shares will vest no earlier than
January 1, 1998, subject to performance-related and continuing employment
vesting requirements. We encourage shareholders to refer to the earlier
sections of this report for details on these programs, and in particular the
performance-related and other requirements that they incorporate.
$1 MILLION COMPENSATION CAP. There is a $1 million limit on the
deductibility of certain compensation for federal income tax purposes
established by the Omnibus Budget Reconciliation Act of 1993 (the "Budget Act").
The Committee has decided not to qualify either the ROA-based annual incentive
program or the 1994 restricted stock award program as "performance-based" plans
for purposes of that Act, because of limitations on the Committee's discretion
that would result. The Committee expects that in the event superior performance
would produce compensation in excess of $1 million, the excess amount will be
deferred in order to preserve the full corporate tax deduction.
The Committee believes that its current compensation philosophy has served
TCF stockholders fairly, as demonstrated by the linkage of executive pay to
performance-related goals and the return to TCF stockholders relative to that of
the S&P 500 Index, the SNL Thrift Index and a TCF-selected group of industry
peers (see "TCF Comparative Stock Performance Graph").
19
<PAGE>
The Committee plans to continue the same compensation philosophy for the
foreseeable future.
By the Personnel/Affirmative Action Committee:
Daniel F. May, Chairman
Bruce G. Allbright
Luella G. Goldberg
Ralph Strangis
TCF COMPARATIVE STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total stockholder return on TCF
Common Stock over the last five fiscal years with the cumulative total return of
the Standard and Poor's 500 Stock Index, the SNL Thrift Index and a TCF-selected
group of peer institutions over the same period (assuming the investment of $100
in each vehicle on December 31, 1989 and reinvestment of all dividends). The
SNL Thrift Index includes every publicly traded thrift institution in the U.S.,
a total of 402 companies as of December 31, 1994, and provides a context for
comparing the TCF-selected peer group to the rest of TCF's industry. The
TCF-selected group of peers consists of thirteen financial institutions, five of
which are thrift institutions and the other eight of which are banking
institutions. The institutions consist of the following: Charter One
Financial, Inc.; Commerce Bancshares, Inc.; First Bancorporation of Ohio; First
Fed Financial Corp.; First Financial Corporation (WI); First Virginia Banks,
Inc.; Fourth Financial Corporation; Provident Bancorp, Inc.; Standard Federal
Bank; Star Banc Corporation; St. Paul Bancorp, Inc.; UMB Financial Corporation
(formerly known as United Missouri Bancshares, Inc.); and West One Bancorp. For
1993, the peer group included Metropolitan Financial Corporation, which in 1994
was removed from the peer group as a result of a merger which made it no longer
comparable. All thrift institutions in the peer group are publicly held and,
except for one, are among the top 25 nationally in terms of market
capitalization, ranging in size from $4 billion to $12 billion in total assets.
The banks in the peer group are publicly held and have total assets ranging from
$4 billion to $10 billion. With two exceptions, all peer group members are
located in the Midwest.
<TABLE>
<CAPTION>
YEAR END
12/31/89 12/31/90 12/31/91 12/31/92 12/31/93 12/31/94
----------------------------------------------------------------------------
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
S & P Total Return 100.0 96.90 126.43 138.06 149.77 151.45
TCFFinancial-MN 100.0 59.03 154.71 234.14 281.64 351.36
1994 TCF Peer Group 100.0 82.89 134.71 190.17 205.01 199.01
1993 TCF Peer Group 100.0 82.57 136.10 193.37 208.77 208.38
SNL Thrift Index 100.0 63.29 98.42 137.15 174.15 171.49
</TABLE>
20
<PAGE>
CERTAIN TRANSACTIONS OF TCF DIRECTORS AND OFFICERS
During 1994, TCF Bank Minnesota had a loan transaction with one executive
officer. Loans were also made to certain family members of directors and
executive officers. All loans to these individuals, as well as to the executive
officer below, were made in the ordinary course of business and on substantially
the same terms, including interest rates and collateral, as those prevailing at
the time for comparable transactions with the general public, and did not
involve more than the normal risk of collectability or present other unfavorable
features.
Set forth below is certain information relating to the loan made to the
executive officer of TCF whose outstanding aggregate indebtedness exceeded
$60,000 at any time since January 1, 1994.
<TABLE>
<CAPTION>
Largest Percentage of
Amount of Amount Stockholders'
Indebtedness Outstanding Equity at
Year Outstanding in at January 1, December 31, Interest
Originated 1994 1995 1994 Rate
---------- -------------- ------------- ------------- --------
<S> <C> <C> <C> <C> <C>
Michael B. Johnstone 1987 (1) $124,192 $ 0 .00% 10.00%
<FN>
_________
(1) Conventional mortgage loan, refinanced in 1992.
</TABLE>
PROPOSAL 2
RATIFICATION OF TCF'S APPOINTMENT OF INDEPENDENT PUBLIC
ACCOUNTANTS
The Board has appointed the firm of KPMG Peat Marwick LLP, independent
public accountants, to audit the financial statements of TCF Financial and its
subsidiaries for the fiscal year ending December 31, 1995.
A proposal to ratify the appointment of KPMG Peat Marwick LLP will be
presented to the stockholders at the Annual Meeting. Representatives of KPMG
Peat Marwick LLP are expected to be present at the Annual Meeting and to be
available to respond to appropriate questions. The representatives will also be
provided an opportunity to make a statement, if they so desire.
THE TCF BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT TCF STOCKHOLDERS
VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF KPMG PEAT MARWICK LLP.
PROPOSAL 3
INCREASE MAXIMUM BOARD OF
DIRECTORS SIZE TO 25
Article 7 of the Certificate of TCF Financial currently provides that the
authorized number of directors shall consist of not fewer than seven nor more
than fifteen directors. It is proposed to amend Article 7.A. of the Certificate
as follows, effective May 1, 1995 (strikeout shows deletion; underline shows
addition):
A. NUMBER OF DIRECTORS
The business and affairs of the Corporation shall be managed by or under
the direction of a Board of Directors (the "Board of Directors"). The
authorized number of directors shall consist of not fewer than seven nor
more than twenty-five directors. Within such limits the exact number of
directors shall be fixed from time to time pursuant to a resolution adopted
by a majority of the Continuing Directors (as defined hereinafter in
Article 8 of the Certificate).
21
<PAGE>
The Board is seeking stockholder approval for this change because Article
14 of the Certificate provides that the affirmative vote of the holders of at
least 80% of the total votes eligible to be cast at a legal stockholders meeting
is required in order to amend or adopt any provisions inconsistent with Article
7 (among other Articles). If the stockholders do not approve the proposal by
the required percentage it will not become effective.
REASONS FOR THE PROPOSAL. The proposed change is useful for TCF to
continue its program of acquisitions. As this program has progressed, TCF's
management and Board has noted the need for additional seats on the Board to
make available in connection with acquisition negotiations. Both of the major
transactions TCF has completed to date - RCG of Milwaukee, Wisconsin in 1993 and
Great Lakes Bancorp of Ann Arbor, Michigan in February 1995 - resulted in
additions to the Board of TCF. One director was added as a result of the RCG
acquisition. Three directors were added as a result of the Great Lakes Bancorp
combination. As a result of these additions to the Board, the Board now numbers
fifteen in total, the maximum number of directors permissible under the current
Certificate. Increasing the permissible number of directors will permit TCF to
make seats on the Board available in connection with potential future
acquisitions and will permit TCF to proceed with its program of acquisitions.
It is anticipated that any vacancies made available through enlargement of the
Board will be used for acquisition situations. However, additional available
positions will also allow TCF to add members to the Board from time to time if
persons who can provide significant value as Board members are identified.
DESCRIPTION OF EXISTING PROVISIONS RELATING TO TCF'S BOARD OF DIRECTORS.
TCF's Certificate requires the Board to be divided into three classes as nearly
equal in number as possible and provides that the members of each shall be
elected for a term of three years and until their successors are elected and
qualified, with one class being elected annually at each annual meeting of the
stockholders. Stockholders are not permitted to cumulate their votes in an
election of directors. Any director may be removed for cause by the holders of
at least a majority of the outstanding voting shares.
Vacancies on the Board resulting from death, resignation, retirement,
disqualification, removed from office or other cause are filled by affirmative
vote of the Continuing Directors. A Continuing Director is, in the case that a
Related Person (a person that is the direct or indirect beneficial owner of more
than (10%) of the corporation's outstanding voting stock) exists, any member of
the Board who is not a Related Person and who was a member of the Board
immediately prior to the time that a Related Person became a Related Person, and
any successor to a Continuing Director who is not a Related Person (or an
affiliate or associate of a Related Person) and is recommended to succeed a
Continuing Director by a majority of the Continuing Directors who are then
members of the Board. If a Related Person does not exist, a Continuing Director
is any member of the Board. If the proposal is approved, the Board will have
the authority by resolution to increase the number of members on the Board and
then appoint and elect new members to fill the vacancies resulting from the
increase, with those members remaining on the Board until the term expires for
the Class to which they were elected. A director elected to fill a vacancy by
reason of an increase in the number of directorships shall be elected by a
majority vote of the directors then in office, although less than a quorum of
the Board of Directors, to serve until the next election of the class for which
such director has been chosen.
TCF's Certificate provides that a director of TCF, to the maximum extent
now or hereafter permitted by the Delaware General Corporate Law (the "DGCL"),
or any successor provision or provisions, will have no personal liability to TCF
or its shareholders, for monetary damages for breach of fiduciary duty as a
director, except (a) for any breach of the director's duty of loyalty to TCF or
its shareholders, (b) for acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law, (c) for the payment of
certain unlawful dividends and the making of certain stock purchases or
redemptions, or (d) for any transaction from which the director derived an
improper personal benefit.
The Certificate provides that special meetings of TCF may be called only by
a majority of the Board of TCF. As a result, stockholders of TCF do not have a
right to call special meetings of stockholders or to require TCF's Board to call
such meetings. TCF's Bylaws provide that nominations for election to the Board
will be made by the Board (or a committee thereof) or by a stockholder who has
complied with the notice provisions set forth in the Bylaws. (See "Information
on Directors and Nominees - Nomination of TCF Directors" earlier in this Proxy
Statement).
22
<PAGE>
The Bylaws also provide that only such business as shall have been properly
brought before an annual meeting shall be conducted at the annual meeting. To
be properly brought before an annual meeting, business must be specified in the
notice of meeting (or any supplement thereto) given by or at the direction of
the Board, or otherwise properly brought before the meeting by a stockholder.
The notice and other requirements for a stockholder to place an item on the
agenda for an annual meeting are described under the heading "Stockholder
Proposals" later in this Proxy Statement.
THE TCF BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT TCF STOCKHOLDERS
VOTE FOR THE PROPOSAL TO INCREASE THE MAXIMUM PERMISSIBLE SIZE OF THE BOARD OF
DIRECTORS FROM 15 TO 25 MEMBERS.
PROPOSAL 4
TCF FINANCIAL 1995
INCENTIVE STOCK PROGRAM
On January 24, 1995, the Board of Directors of TCF Financial adopted the
TCF Financial 1995 Incentive Stock Program (the "Program"), subject to
shareholder approval. The objective of the Program is to attract and motivate
outstanding officers and employees capable of assuring the future success of TCF
Financial and its subsidiaries, by providing them with an opportunity to acquire
TCF Common Stock. This Program is a continuation and replacement of TCF's prior
Stock Option and Incentive Plan (the "Prior Plan"). The Prior Plan was adopted
in connection with TCF Bank Minnesota's conversion to a publicly held company in
June 1986 and was designed to be in effect for ten years. The Program is being
submitted for approval by the stockholders of TCF Financial pursuant to
requirements of the NYSE, Rule 16b-3 of the SEC, and Section 162(m) of the Code.
No further awards are expected to be made under the Prior Plan, assuming the
Program is approved. If the Program is not approved by the stockholders, it
will not be implemented.
DESCRIPTION OF THE PROGRAM
The Program is administered by a committee (the "Committee") comprised of
at least two members of the Personnel Affirmative Action Committee of the Board,
or such other persons as the Board may from time to time designate. The Program
is intended to qualify for exemption under Rule 16b-3 of the Securities and
Exchange Commission and awards under the Program may, under certain
circumstances, be excluded from compensation for purposes of the limits on
deductible compensation under Code section 162(m). Accordingly, membership on
the Committee is restricted to individuals who qualify as disinterested under
Rule 16b-3 of the SEC and as "independent" to the extent necessary for purposes
of Section 162(m) of the Code. The Committee determines the individuals who are
eligible to receive stock options, restricted stock, stock appreciation rights
("SAR's") or other awards, the number of shares subject to such awards, the
exercise price of any stock option or SAR, the manner, time and rate of exercise
of any stock option or SAR, the rate of vesting of any restricted stock, and any
other restrictions to be placed upon any stock, stock option, SAR or the shares
that are to be issued upon the exercise of any stock option, SAR, or other
award. The Committee may designate the officers and employees eligible to
receive benefits under the Program. There are approximately 4,697 persons as of
March 1, 1995 who are eligible for selection to participate in the Program.
Nonemployee directors are not eligible to participate in the Program. No more
than 5% of the shares of TCF Common Stock outstanding on the date of initial
stockholder approval may be awarded under the Program unless stockholders
approve an increase in this limit. Based on 17,410,911 shares of TCF Common
Stock outstanding on the record date, this limit would be 870,545.55 shares.
Stock options granted under the Program may be either incentive stock
options ("Incentive Stock Options") subject to certain limitations and
restrictions with the intent that such options will qualify under Section 422 of
the Code, or options that do not qualify as Incentive Stock Options under such
statutory provisions ("Nonqualified Stock Options"). Incentive Stock Options
awarded under the Program cannot have an exercise price of less than 100% of the
fair market value of TCF Common Stock on the date of the award. Nonqualified
Stock Options awarded under the Program cannot have an excise price of less than
85% of the fair market value of TCF Common Stock on the date of the award.
23
<PAGE>
The Program also provides for the issuance of SAR's. The Committee may, in
its discretion, grant a SAR to the holder of any stock option granted under the
Program. These SAR's may be granted with respect to a stock option at the time
of grant or anytime thereafter, and in the event of the exercise of a SAR the
number of shares under the Program shall be reduced by the number of shares
covered by the stock option or portion thereof exercised. The exercise price
for stock options or SAR's is determined by the Committee.
The Program also provides for the issuance of performance units
("Performance Units") which are monetary units granted to participants which may
be earned in whole or in part if the Company achieves certain corporate goals
established by the Committee over a designated period of time, but not in any
event more than five years. In the event the minimum corporate goal established
by the Committee is not achieved at the conclusion of a period, no amount shall
be paid or vested in the participant. In the event the maximum corporate goal
is achieved, 100% of the monetary value of the Performance Units shall be paid
to or vested in the participants. Partial achievement of the maximum goal may
result in a payment or vesting corresponding to the degree of achievement.
Payment of an award earned may be in cash or in common shares or a combination
of both, and may be made when earned, or vested and deferred, as the Committee
in its sole discretion determines.
The Program also provides for the issuance of restricted stock ("Restricted
Stock") upon such terms and conditions as the Committee specifies. There is no
limit on the number of shares of Restricted Stock that may be awarded under the
Program (except for the overall limit on the number of shares which may be
awarded under the Program). The Committee specifies a restricted period and
vesting schedule, according to which ownership of the Restricted Stock is
determined, and which may include such matters as the deferral of dividends or
other limitations on ownership. Unless otherwise agreed upon by the Committee
and the recipient, holders of Restricted Stock have the right to vote the
restricted shares prior to the vesting date of the restricted stock. The
Committee may also make Restricted Stock awards in the form of deferred awards,
and these shares may be issued in the name of a trustee at or prior to the time
at which restrictions on the shares issued would lapse.
The Committee generally has the right to accelerate the time at which any
or all of the restrictions on Restricted Stock will lapse or to remove any or
all of the restrictions whenever it may determine that such action is
appropriate. In general, if the recipient of Restricted Stock shall cease to be
continuously employed by TCF Financial or an affiliate during the restricted
period, the recipient's rights to Restricted Stock not yet vested will be
forfeited. Exceptions may be made for retirement, disability or death according
to the terms of the award agreement or exceptions the Committee approves in each
case.
The Committee has the right to grant to recipients the right to receive a
cash payment in connection with the exercise of a Nonqualified Stock Option or
the granting or vesting of Restricted Stock, to withhold stock for payment of
taxes or to provide other assistance or means for payment of taxes.
Shares issued pursuant to the Program may be either authorized and unissued
shares or issued shares acquired by TCF Financial and held as treasury shares.
Where stock options, SAR's or Restricted Stock are forfeited or terminated, the
shares as to which such forfeiture or termination has occurred will be available
for the granting of new awards under the Program.
The overall limit on shares which may be awarded (5% of TCF Common Stock
and the number of shares subject to stock options and SAR's, or which are
granted as Restricted Stock or as Performance Units, will be appropriately
adjusted by the Committee in the event of changes in the outstanding stock of
TCF Financial by reason of any reorganization, recapitalization, stock split,
stock dividend, combination or exchange of shares, merger, consolidation or any
changes in the corporate structure of TCF Financial or shares of TCF Common
Stock.
24
<PAGE>
The Program does not allow "reload" options or repricing of options. The
Program will continue in effect for a term of ten years after its approval by
stockholders in 1995, until April 19, 2005, unless earlier terminated by the
Board. The Board generally may amend, suspend or terminate the Program or any
portion thereof at any time. Except for adjustments made due to changes in
outstanding common stock as described above, the Program provides that no
amendment may be made without the consent of stockholders where such amendment
would (i) increase the aggregate number of shares with respect to which awards
may be granted under the Program, or (ii) change any class of persons eligible
to participate in the Program. No amendment, suspension or termination of the
Program by the Board may have the effect of impairing any awards previously
granted to a participant, unless the participant consents to such impairment.
CHANGE-IN-CONTROL PROVISIONS
The Program provides that, upon the occurrence of certain events that would
constitute a "change in control," all outstanding awards will either become
fully exercisable or fully vested. Under the Program, a "change in control"
occurs when any "person" as defined in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 (the "Exchange Act") is or becomes the
"beneficial owner," as defined in Rule 13d-3 under the Exchange Act, of
securities of TCF Financial representing 30% or more of the combined voting
power of TCF Financial's then outstanding securities. A change in control is
also defined as any two consecutive year periods in which there ceases to be a
majority of the Board whose nomination for election by TCF Financial's
shareholders was approved by a vote of at least two thirds (2/3) of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved.
Lastly, a change in control would occur if the shareholders approve a merger or
consolidation of TCF Financial with any other corporation, other than a merger
or consolidation which would result in the voting securities of TCF Financial
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least 70% of the combined voting power of the voting
securities of TCF Financial or such surviving entity outstanding immediately
after such merger or consolidation, or the shareholders of TCF Financial
approve a plan of complete liquidation of TCF Financial of all or substantially
all of TCF Financial's assets; provided, however, that no change in control will
be deemed to have occurred if such merger, consolidation, sale or disposition of
assets, or liquidation is not subsequently consummated.
In the event of a change in control of TCF Financial, the foregoing
provisions of the Program could result in the vesting of Restricted Stock or
stock options or SAR's or vesting of other awards under the Program at a time
when they would not otherwise vest or be exercisable. Such vesting or
exercisability, together with other anti-takeover provisions included in TCF
Financial's Certificate and the accumulation of shares of TCF Common Stock in
the 401-(k) Plan and the Executive and Senior Officer Deferred Compensation
Plans may have the effect of discouraging a merger, tender offer, or acquisition
of stock that would constitute a "change in control". However, the change in
control provision is not intended to increase the amounts payable to
participants in the Program but is designed to ensure that a participant will
not, as the result of a change in control, be denied benefits under the Program
to which the participant would otherwise have been entitled to receive. If a
change in control were to occur at March 1, 1995, this provision of the Program
would not result in the exercisability of stock options for any shares that
otherwise would not be exercisable currently, and would not vest any shares of
Restricted Stock, because no awards have yet been made under the Program.
The Program provides that there will not be any special change-in control
vesting for two years after the Program's approval by stockholders unless it is
approved in advance by the Committee.
EXISTING LIMITATIONS ON ACQUISITION OF CONTROL OF TCF FINANCIAL
In addition to approvals from regulatory agencies, there are certain
existing provisions of the Certificate of TCF Financial which may make it more
difficult to acquire control of TCF Financial. The principal provisions are
summarized below.
25
<PAGE>
TCF Financial's Certificate includes a "Minimum Price" provision which
generally requires a business combination with a significant stockholder to meet
certain procedural and price conditions, unless it is approved by the Continuing
Directors (as defined) or by an 80% vote of the stockholders of TCF Financial
who are unaffiliated with the significant stockholder. This could have the
effect of discouraging or defeating any two-step takeover attempt not deemed
appropriate by the Board.
TCF Financial's Certificate authorizes the issuance of up to 70,000,000
shares of common stock and 30,000,000 shares of preferred stock without further
stockholder approval, and authorizes issuance of the preferred shares with less
than one vote, one vote, or more than one vote per share. These provisions
could be used by the Board to deter a takeover attempt which the Board does not
approve by authorizing the issuance of preferred stock with rights and
preferences which could impede the completion of such a transaction, or through
negotiated sale of such shares to parties friendly to TCF Financial.
TCF Financial's Certificate requires approval of 80% of the shares eligible
to vote at a meeting in order to amend provisions of the Certificate or to amend
the Bylaws related to takeover matters.
TCF Financial has a classified Board, with each class of directors holding
office for staggered three-year terms. Cumulative voting is not authorized in
the election of directors. These provisions, singly or in combination, could
preclude a potential acquirer from changing the membership of the Board over
less than a three-year term, or electing one or more directors of its choosing
without the cooperation of other significant stockholders.
TCF Financial's Bylaws set forth procedures concerning a stockholder
proposal or a stockholder director nomination for consideration at any annual
meeting. See "Stockholder Proposals" and "Information on Directors and
Nominees - Nomination of TCF Directors," respectively, for a discussion of these
Bylaws. The advance notice requirement for stockholder proposals, by regulating
the introduction of new business at an annual meeting of stockholders, affords
the Board the opportunity to consider stockholder proposals and, to the extent
deemed necessary or desirable by the Board, respond accordingly. Although the
Bylaw does not give the Board any power to approve or disapprove of stockholder
proposals, it may have the effect of precluding such proposals if the procedures
established by it are not followed and may discourage or deter a third party
from conducting a solicitation of proxies in furtherance of such proposals. The
advance notice requirement for stockholder director nominations, by regulating
such nominations at an annual meeting of stockholders, affords the Board the
opportunity to consider the qualifications of the proposed nominees and, to the
extent deemed necessary or desirable by the Board, inform stockholders about
such qualifications. Although the Bylaws do not give the Board any power to
approve or disapprove of stockholder nominations for election of directors, it
may have the effect of precluding contests for the election of directors if the
procedures established by it are not followed, and may discourage or deter a
third party from conducting a solicitation of proxies to elect its own slate of
directors.
TCF Financial's Certificate also provides that special meetings of
stockholders may only be called by a majority of the Continuing Directors. This
provision is designed to safeguard provisions of the Certificate and the Bylaws
relating to control of TCF Financial by making it more difficult for a stock
accumulator to call a special meeting for such purposes as amending the Bylaws
or electing new directors. As a result, stockholders may be forced to wait
until the next annual meeting to propose matters for stockholder consideration.
In addition to the measures in TCF Financial's Certificate and Bylaws, as
described earlier, the Program contains certain provisions which provide or
accelerate benefits to participants in the event of a change in control. These
provisions would allow certain management employees of TCF Financial to obtain
additional shares of stock, making it more difficult for a potential acquirer to
obtain the 80% stockholder approval required for certain business combinations
and for amending certain provisions of the Certificate and Bylaws. See
"Change-in-Control Provisions" earlier in the discussion of this proposal.
Also, there is a potential anti-takeover impact from accumulation or potential
accumulation of TCF Common Stock in the Executive and Senior Officer Deferred
Compensation Plans and the 401-K Plan. See "Securities Ownership Table." These
plans could have the effect of placing a significant number of shares of TCF
Common Stock
26
<PAGE>
under the control or influence of employees or directors of TCF Financial or its
affiliates. The 401-K Plan owns approximately 8.69% of the stock of TCF
Financial as of December 31, 1994. Any concentration of voting power in these
plans might be viewed as making it more difficult for an acquirer to effect a
change in control.
The DGCL prohibits a stockholder owning 15% or more of the voting shares of
a corporation under Delaware law from engaging in any of a number of
transactions with the corporation for three years after the 15% stock ownership
is attained, unless the transaction is approved in advance by the board of
directors of the corporation or comes within one of the exceptions in the
statute. This section of DGCL applies to TCF Financial.
On May 23, 1989, the Board adopted a Shareholder Rights Plan under which a
dividend of one preferred share purchase right for each share of common stock
was declared, payable on June 9, 1989, to holders of record on that date. Such
rights also attach to shares issued subsequent to June 9, 1989. The rights will
become exercisable only if a person or group acquires or announces an offer to
acquire 15% or more of TCF's Common Stock. This triggering percentage may be
reduced to no less than 10% by the Board under certain circumstances. When
exercisable, each right will entitle the holder to buy one one-hundredth of a
share of a new series of junior participating preferred stock at a price of $60
per share. In addition, upon the occurrence of certain events, holders of the
rights will be entitled to purchase either TCF's Common Stock or shares in an
"acquiring entity" at half of the market value. The Board is generally entitled
to redeem the rights at 1 cent per right at any time before they become
exercisable. The rights will expire on June 9, 1999, if not previously redeemed
or exercised.
As a result of the foregoing measures, TCF Common Stock may not attract
institutional investors or certain other members of the investment community and
this could result in a depressed market price and liquidity for TCF Common Stock
and/or discourage non-negotiated takeover offers that might have been deemed by
stockholders to be in their interests and might have involved offers to purchase
TCF Common Stock at a premium over the market price prevailing at the time.
INCOME TAX CONSEQUENCES
TCF Financial has been advised by counsel that under the Code, as presently
in effect, the following federal tax consequences generally will result under
the Program:
1. The recipient of a stock option or SAR will not be deemed to receive
any income for Federal tax purposes at the time an option or SAR is granted, nor
will the Company be entitled to a tax deduction at that time.
2. In the case of Incentive Stock Options, there generally is no tax
liability to the recipient at time of exercise (excluding potential alternative
minimum tax consequences.) However, the recipient will recognize ordinary
income at the time of exercise, in an amount equal to the difference between the
option price and market value of the shares on the exercise date, if the options
exercised more than three months after the recipient's employment terminates for
reasons other than death or disability. The recipient will be taxed on any gain
realized on a sale of stock acquired pursuant to an Incentive Stock Option,
measured as the difference between the option price on the date of grant and the
sale price. If the sale occurs at least two years after the option was granted
and at least one year after the option was exercised, the gain will be taxed as
long-term capital gain. If the sale occurs within two years after the option
was granted or within one year after the option was exercised, the difference
between the market value of the shares when the option was exercised and the
option price (or, if less, the entire amount of the gain) will be taxed as
ordinary income. If the sale price is less than the option price, the
difference will be treated as a capital loss. If a recipient exercises an
Incentive Stock Option with shares acquired under a previous Incentive Stock
Option, the transaction will be taxed the same as a sale of the previously
acquired shares unless the recipient has held the shares for at least two years
after the previous option was granted, and for at least one year after the
previous option was exercised.
27
<PAGE>
3. In the case of an exercise of a Nonqualified Stock Option, recipients
will be deemed to have received ordinary income in an amount equal to the
difference between the option price and market price of the shares on the
exercise date. Upon a sale of stock acquired pursuant to a Nonqualified Stock
Option, any difference between the sale price and the market value of the stock
on the date the option was exercised will be treated as a capital gain or
capital loss.
4. In the case of an exercise of a SAR or the payment of a Performance
Award, the recipient will be deemed to have received ordinary income on the
exercise or payment date in an amount equal to any cash and/or the market value
of unrestricted shares received.
5. A recipient of Restricted Stock normally will not recognize taxable
income at the time the stock is issued, unless rights to part or all of the
stock are immediately vested. Thereafter, the recipient will recognize ordinary
income equal to the market value of the Restricted Stock (in excess of any
amount paid by the recipient) at the time the restrictions lapse. However, the
recipient may elect to recognize ordinary income in an amount equal to the
market value of the Restricted Stock (in excess of any amount paid by the
recipient) at the time the stock is issued. Any subsequent change in the value
of the Restricted Stock would then be treated as a capital gain or loss if and
when the stock is sold. The Company will be allowed a deduction when and as the
value of the Restricted Stock is treated as ordinary income to the recipient.
6. Upon the exercise of a Nonqualified Stock Option or SAR or the payment
of a Performance Award, the Company will generally be allowed an income tax
deduction equal to the ordinary income recognized by the recipient. No income
tax deduction will be allowed the Company as a result of the exercise of an
Incentive Stock Option. However, if shares acquired pursuant to the exercise of
an Incentive Stock Option are disposed of before the later of one year from the
date of exercise and two years from the date of grant, the Company will be
allowed an income tax deduction equal to the ordinary income recognized by the
recipient as a result of the premature sale.
Under current Generally Accepted Accounting Principles, there would be no
charge to the operations of the Company in connection with the grant or exercise
of a stock option that is granted at market value. In the case of below-market
options and SAR's, compensation expense would be recorded ratably over the
vesting period, in an amount equal to the difference between the option price
and the market value on the date of grant. Compensation expense for Restricted
Stock is recorded over the vesting periods.
The income tax consequences set forth above are a summary only, and are
based upon federal tax laws currently in effect. The tax consequences may be
different in particular circumstances.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
FOR THE APPROVAL OF THE TCF FINANCIAL 1995 INCENTIVE STOCK PROGRAM AS SET FORTH
IN PROPOSAL 4.
PROPOSAL 5
APPROVE DIRECTORS DEFERRED
COMPENSATION PLAN AND TRUST AGREEMENT
On September 12, 1994 the Director Fee Deferral Plan previously in effect
for directors of TCF Financial was amended by the Board and renamed the TCF
Directors Deferred Compensation Plan (hereinafter "the Plan"). A complete copy
of the Plan (and the related Trust Agreement) is on file with the SEC and is
available on request by any stockholder directed to TCF's Corporate Secretary at
801 Marquette Avenue South, Minneapolis, Minnesota 55402-2807. The Plan is
effective for fees earned on and after January 1, 1995, subject to shareholder
approval. Full power to construe, interpret and administer the Plan is vested
with the Administrative Committee (hereinafter "the Committee"), which consists
of employee directors of TCF Financial. The Board of Directors also approved a
trust agreement for deferred amounts, the TCF Directors Deferred Compensation
Trust Agreement.
28
<PAGE>
Approval of the Plan and Trust by stockholders is being sought in order to
assure that the Plan qualifies for exemption from short-swing profit liability
pursuant to Rule 16b-3 of the SEC. If stockholders do not approve the Plan, the
Board will reconsider whether to implement the Plan or may seek a ruling that
the Rule 16b-3 exemption is not required.
The Plan allows amendments to be made by the Board from time to time,
provided that no such amendment may (without a director's consent) alter rights
to payments of amounts already credited to accounts or delay the time at which
deferred amounts were scheduled to be paid under the Plan. TCF intends to
maintain the Plan and Trust in a manner that will allow ongoing availability of
the exemption under SEC Rule 16b-3 (unless a ruling is received indicating that
such exemption is not necessary) and therefore currently intends to submit to
stockholders for approval any amendments which would materially increase the
benefits available under the Plan or the number of securities which may be
issued under the Plan, or materially modify the requirements for participation
in the Plan.
The Plan allows non-employee directors of TCF Financial and directors of
certain TCF subsidiaries (currently a total of approximately 45 persons) to
elect by written notice to defer payment of all or a portion of their director's
fees for the next succeeding calendar year, and for all or a portion of any
grant of shares of TCF Common Stock to the director made on or after the
election. Participation in the Plan is voluntary and directors may change their
elections annually. The Plan allows optional deferral of existing fees and
awards, with investment of such deferrals in TCF Common Stock. Elections with
respect to deferred amounts are to be made in writing by the director prior to
the latest to occur of the following: (i) the beginning of the calendar year
for which the fees are to be earned (ii) the director's first day of board
service in the year; or (iii) the first day of the calendar month next following
the date the director first becomes eligible to participate in the Plan;
provided that directors who file Form 4 reports with the SEC cannot make
elections later than six months prior to the date on which any fees deferred by
the director are invested in TCF Common Stock.
Each company is to establish on its books a separate account for each of
its directors who participates in the Plan. All deferred amounts are invested
in TCF Common Stock and the value of a director's account is measured by the
value of and income from TCF Common Stock. At the time a director makes his or
her first election, the director may also choose to have deferred amounts
contributed to a trust commonly known as a "rabbi" trust, established to aid in
the accumulation of assets for payment of deferred amounts. Separate accounts
are to be set up for each director who elects to make deferrals, and each
company may, in its discretion, contribute to the trust an amount equal to the
deferred amount, if it is done within five business days after the deferred
amount would otherwise be paid to the director.
Each participating TCF company will pay all administrative expenses of the
Plan for its participating directors as well as the applicable portion of
trustee's fees and expenses, currently estimated at $1000 per year. (If the
company does not pay, the trust is liable for the expenses.) All income
received by the trust, net of expenses and taxes (if any) will be reinvested in
TCF Common Stock.
Not later than the next regularly scheduled meeting of the Committee
following a director's termination of service, the Committee must direct the
trustee to commence distribution of the amounts credited to such director's
account and direct the trustee as to the form of payment (whether in cash or in
TCF Common Stock). Amounts held in the account are paid in a lump sum or in
annual installments, consistent with the method of payment selected by the
director at the time the deferral election was initially made. In
the event of an "unforeseen emergency", such as a severe financial hardship to
the director resulting from a sudden and unexpected illness or accident of the
director, beneficiary or dependent, (as defined by Section 152(a) of the Code),
the Committee may determine the amount to be paid from the deferred amount.
In the event of death, a director's payment shall be made to the persons
named in the last written instrument signed by the director and received by the
Committee prior to the director's death, and in the event the director fails to
name any person, the amounts shall be paid to the director's estate or the
appropriate distributee thereof.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
FOR THE APPROVAL OF THE DIRECTORS DEFERRED COMPENSATION PLAN AND TRUST
AGREEMENT.
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<PAGE>
NEW PLAN BENEFITS
The following table shows plan benefits that would accrue to or be
allocated to each of the five named executives, all executives as a group, all
non-employee directors as a group and all employees as a group under the two
plans proposed for approval at the Annual Meeting.
<TABLE>
<CAPTION>
TCF Financial 1995 TCF Directors Deferred
Name and Position Incentive Stock Program Compensation Plan
----------------- ----------------------- ----------------------
-----------------
<S> <C> <C>
William A. Cooper, $ 0(a) N/A
Director, Chairman of the Board
and Chief Executive Officer
Thomas A. Cusick, 0(a) N/A
Director and Vice Chairman; Director,
Vice Chairman and Chief Executive
Officer of TCF Bank Minnesota
Joseph P. Clifford, 0(a) N/A
Director and Vice Chairman
Robert E. Evans, 0(a) N/A
Director and Vice Chairman
James E. Tuite, 0(a) N/A
Executive Vice President; President and
Chief Operating Officer of TCF Bank
Minnesota
Executive Group (including the five N/A N/A
named executives above)
Non-Executive Director Group N/A $156,125(b)
All Employees as a Group N/A N/A
------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------
<FN>
(a) No awards have yet been made under the proposed TCF Financial 1995 Incentive Stock Program.
(b) Amounts shown are estimated allocations for 1995 under the TCF Directors Deferred Compensation Plan, representing the
aggregate of the fees stock awards directors have elected to defer in 1995.
</TABLE>
STOCKHOLDER PROPOSALS
Any stockholder wishing to have a proposal considered for inclusion in TCF
Financial's 1996 proxy solicitation materials must set forth such proposal in
writing and file it with the Secretary of TCF Financial no later than November
22, 1995. The Board will review any stockholder proposals which it receives by
this date and will determine whether any such proposal should be included in its
1996 proxy solicitation materials. Matters and proposals so presented may be
excluded from the 1996 proxy solicitation materials if they fail to meet certain
criteria. Stockholders are urged to submit any such proposal by certified mail,
return receipt requested. Nothing in this paragraph shall be deemed to require
TCF Financial to include in its proxy statement and proxy relating to the 1996
annual meeting of stockholders any stockholder proposal which does not meet all
of the requirements for inclusion established by the SEC in effect at the time
such proposal is received.
Any stockholder proposals for the annual meeting which are not presented to
TCF Financial for inclusion in its proxy solicitation materials, as described
above, must comply with TCF Financial's Bylaws. They require that a stockholder
provide notice of any proposal to be submitted at any annual meeting to be
delivered to the Secretary of TCF Financial not less than 60 days nor more than
90 days prior to the date of an annual meeting, unless notice or public
disclosure of the date of the meeting occurs not less than 70 days prior to the
date of the meeting, in which event stockholders must deliver such notice not
later than the tenth day following the earlier of the day on which notice of the
annual meeting was mailed or public disclosure of the meeting date was made.
Public disclosure of the date of the Annual Meeting for 1995 was made on
February 8, 1995 by distribution of a news release. Notice was also published
in the legal notice section of newspapers in Minnesota on February 20, 1995, and
on February 24, 1995 in Illinois, Michigan and Wisconsin. TCF Financial did not
receive any notice of any proposal within the requisite period. The Bylaws
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<PAGE>
also provide procedures for stockholders to nominate directors for election at
an annual meeting of stockholders. These procedures were discussed earlier in
this Proxy Statement. See "Election of TCF Directors - Information on Directors
and Nominees."
The discussion of the Bylaws in this Proxy Statement concerning a
stockholder proposal or a stockholder director nomination for consideration at
an annual meeting of stockholders is intended to summarize the relevant Bylaws.
These summaries are qualified in their entirety by reference to those Bylaws.
ANNUAL REPORT
TCF FINANCIAL WILL PROVIDE WITHOUT CHARGE TO ANY STOCKHOLDER SOLICITED HEREBY A
COPY OF ITS 1994 ANNUAL REPORT ON FORM 10-K FILED WITH THE SEC UPON THE WRITTEN
REQUEST OF SUCH STOCKHOLDER. REQUESTS SHOULD BE DIRECTED TO THE OFFICE OF
CORPORATE SECRETARY, TCF FINANCIAL.
31
<PAGE>
APPENDICES
A. TCF Financial 1995 Incentive Stock Program
B. TCF Directors Deferred Compensation Plan
<PAGE>
APPENDIX A
TCF FINANCIAL 1995 INCENTIVE STOCK PROGRAM
1. PURPOSE.
The purpose of the TCF Financial 1995 Incentive Stock Program (the
"Program") is to attract and retain outstanding individuals as officers and
other employees of TCF Financial Corporation (the "Company") and its
subsidiaries, and to furnish incentives to such persons by providing such
persons opportunities to acquire common shares of the Company, or monetary
payments based on the value of such shares or the financial performance of the
Company, or both, on advantageous terms as herein provided (the "Benefits").
2. ADMINISTRATION.
The Program will be administered by a committee (the "Committee") of
at least two persons which shall be either the Compensation Committee of the
Board of Directors of the Company or such other committee comprised entirely of
"disinterested persons" as defined in Rule 16b-3 of the Securities and Exchange
Commission as the Board of Directors may from time to time designate. In
addition, if necessary for purposes of Section 162(m) of the Internal Revenue
Code of 1986, as amended (the "Code"), membership on the Committee shall be
limited to individuals who qualify as "independent" under that Section. The
Committee shall interpret the Program, prescribe, amend and rescind rules and
regulations relating thereto, and make all other determinations necessary or
advisable for the administration of the Program. A majority of the members of
the Committee shall constitute a quorum, and all determinations of the Committee
shall be made by a majority of its members. Any determination of the Committee
under the Program may be made without notice of meeting of the Committee by a
writing signed by a majority of the Committee members.
3. PARTICIPANTS.
Participants in the Program will consist of such officers and other
employees of the Company and its subsidiaries as the Committee in its sole
discretion may designate from time to time to receive Benefits hereunder. The
Committee's designation of a participant in any year shall not require the
Committee to designate such person to receive a Benefit in any other year. The
Committee shall consider such factors as it deems pertinent in selecting
participants and in determining the type and amount of their respective
Benefits, including without limitation (i) the financial condition of the
Company; (ii) anticipated profits for the current or future years; (iii)
contributions of participants to the profitability and development of the
Company; and (iv) other compensation provided to participants.
4. TYPES OF BENEFITS.
Benefits under the Program may be granted in any one or a combination
of (a) Incentive Stock Options; (b) Non-qualified Stock Options; (c) Stock
Appreciation Rights; (d) Restricted Stock Awards; and (e) Performance Units, all
as described below and pursuant to the Plans set forth in paragraphs 6-10
hereof. Notwithstanding the foregoing, the Committee may not award more than
100,000 shares in the aggregate in the form of Incentive Stock Options,
Non-qualified Stock Options and Stock Appreciation rights combined in any one
calendar year to any individual participant. Any Benefits awarded under the
Program shall be evidenced by a written agreement containing such terms and
conditions as the Committee may determine, including but not limited to vesting
of Benefits.
<PAGE>
5. SHARES RESERVED UNDER THE PROGRAM.
There is hereby reserved for issuance under the Program, subject to
the adjustments under paragraph 17, an aggregate of five percent of the Common
Shares issued and outstanding (but excluding treasury shares) as of the date of
shareholder approval of this Program. If there is a lapse, expiration,
termination or cancellation of any Benefit granted hereunder without the
issuance of Common Shares or payment of cash thereunder, the shares subject to
or reserved for such Benefit may again be used for new options, rights or awards
of any sort authorized under this Program; provided, however, that in no event
may the number of Common Shares issued under this Program exceed the total
number of shares reserved for issuance hereunder.
6. INCENTIVE STOCK OPTION PLAN.
Incentive Stock Options will consist of options to purchase Common
Shares at purchase prices not less than one hundred percent (100%) of the Fair
Market Value (as defined in paragraph 16 below) of such Common Shares on the
date of grant. Incentive Stock Options will be exercisable over not more than
ten (10) years after the date of grant. In the event of termination of
employment for any reason other than retirement, disability or death, the right
of the optionee to exercise an Incentive Stock Option shall terminate upon the
earlier of the end of the original term of the option or three (3) months after
the optionee's last day of work for the Company and its subsidiaries. If the
optionee should die within three (3) months after termination of employment for
any reason other than retirement or disability, the right of his or her
successor-in-interest to exercise an Incentive Stock Option shall terminate upon
the earlier of the end of the original term of the option or three (3) months
after the date of such death. In the event of termination of employment due to
retirement or disability, or if the optionee should die while employed, the
right of the optionee or his or her successor in interest to exercise an
Incentive Stock Option shall terminate upon the earlier of the end of the
original term of the option or twelve (12) months after the date of such
retirement, disability or death. If the optionee should die within twelve (12)
months after termination of employment due to retirement or disability, the
right of his or her successor-in-interest to exercise an Incentive Stock Option
shall terminate upon the later of twelve (12) months after the date of such
retirement or disability or three (3) months after the date of such death, but
not later than the end of the original term
of the option. The aggregate fair market value (determined as of the time the
Option is granted) of the Common Shares with respect to which Incentive Stock
Options are exercisable for the first time by any individual during any calendar
year (under all option plans of the Company and its subsidiaries) shall not
exceed $100,000. An Incentive Stock Option granted to a participant who is
subject to Section 16 of the Securities Exchange Act of 1934, as amended (the
"Securities Exchange Act"), may be exercised only after six (6) months from its
grant date (unless otherwise permitted under Rule 16b-3 of the Securities and
Exchange Commission).
7. NON-QUALIFIED STOCK OPTION PLAN.
Non-qualified Stock Options will consist of options to purchase Common
Shares at purchase prices not less than eighty-five percent (85%) of the Fair
Market Value of such Common Shares on the date of grant. Non-qualified Stock
Options will be exercisable over not more than ten (10) years after the date of
grant. In the event of termination of employment for any reason other than
retirement, disability or death, the right of the
2
<PAGE>
optionee to exercise a Non-qualified Stock Option shall terminate upon the
earlier of the end of the original term of the option or three (3) months after
the optionee's last day of work for the Company and its subsidiaries. If the
optionee should die within three (3) months after termination of employment for
any reason other than retirement or disability, the right of his or her
successor-in-interest to exercise a Non-qualified Stock Option shall terminate
upon the earlier of the end of the original term of the option or three (3)
months after the date of such death. In the event of termination of employment
due to retirement or disability, or if the optionee should die while employed,
the right of the optionee or his or her successor-in-interest to exercise a Non-
qualified Stock Option shall terminate upon the earlier of the end of the
original term of the option or twelve (12) months after the date of such
retirement, disability or death. If the optionee should die within twelve (12)
months after termination of employment due to retirement or disability, the
right of his or her successor-in-interest to exercise a Non-qualified Stock
Option shall terminate upon the later of twelve (12) months after the date of
such retirement or disability or three (3) months after the date of such death,
but not later than the end of the original term of the option. A Non-qualified
Stock Option granted to a participant who is subject to Section 16 of the
Securities Exchange Act may be exercised only after six (6) months from its
grant date (unless otherwise permitted under Rule 16b-3 of the Securities and
Exchange Commission).
8. STOCK APPRECIATION RIGHTS PLAN.
The Committee may, in its discretion, grant a Stock Appreciation Right
to the holder of any Stock Option granted hereunder or under the Prior Stock
Option Programs. Such Stock Appreciation Rights shall be subject to such terms
and conditions consistent with the Program as the Committee shall impose from
time to time, including the following:
(a) A Stock Appreciation Right may be granted with respect to a Stock
Option at the time of its grant or at any time thereafter.
(b) Subject to paragraph 8(d) below, Stock Appreciation Rights will
permit the holder to surrender any related Stock Option or portion thereof
which is then exercisable and to elect to receive in exchange therefor cash
in an amount equal to:
(i) The excess of the Fair Market Value on the date of such
election of one Common Share over the option price multiplied by
(ii) The number of shares covered by such option or portion
thereof which is so surrendered.
(c) A Stock Appreciation Right granted to a participant who is
subject to Section 16 of the Securities Exchange Act may be exercised only
after six (6) months from its grant date (unless otherwise permitted under
Rule 16b-3 of the Securities and Exchange Commission).
(d) The Committee shall have the discretion to satisfy a
participant's right to receive the amount of cash determined under
subparagraph (b) hereof, in whole or in part, by the delivery of Common
Shares valued as of the date of the participant's election.
3
<PAGE>
(e) In the event of the exercise of a Stock Appreciation Right, the
number of shares reserved for issuance hereunder shall be reduced by the
number of shares covered by the Stock Option or portion thereof
surrendered.
9. RESTRICTED STOCK AWARDS PLAN.
Restricted Stock Awards will consist of Common Shares transferred to
participants without other payment therefor as additional compensation for their
services to the Company or one of its subsidiaries. Restricted Stock Awards
shall be subject to such terms and conditions as the Committee determines
appropriate including, without limitation, restrictions on the sale or other
disposition of such shares and rights of the Company to reacquire such shares
upon termination of the participant's employment within specified periods.
Subject to such other restrictions as are imposed by the Committee, the Common
Shares covered by a Restricted Stock Award granted to a participant who is
subject to Section 16 of the Securities Exchange Act may be sold or otherwise
disposed of only after six (6) months from the grant date of the award (unless
otherwise permitted under Rule 16b-3 of the Securities and Exchange Commission).
10. PERFORMANCE UNITS PLAN.
Performance Units shall consist of monetary units granted to
participants which may be earned in whole or in part if the Company achieves
certain goals established by the Committee over a designated period of time, but
not in any event more than five (5) years. The goals established by the
Committee may include earnings per share, return on shareholder equity, return
on average total capital employed, and/or such other goals as may be established
by the Committee in its discretion. In the event the minimum corporate goal
established by the Committee is not achieved at the conclusion of a period, no
amount shall be paid to or vested in the participant. In the event the maximum
corporate goal is achieved, one hundred percent (100%) of the monetary value of
the Performance Units shall be paid to or vested in the participants. Partial
achievement of the maximum goal may result in a payment or vesting corresponding
to the degree of achievement. Payment of an award earned may be in cash or in
Common Shares (valued as of the date on which certificates for such Common
Shares are issued to the participant) or in a combination of both, and may be
made when earned, or vested and deferred, as the Committee in its sole
discretion determines. Deferred awards shall earn interest on the terms and at
a rate determined by the Committee. The number of shares reserved for issuance
hereunder shall be reduced by the largest whole number obtained by dividing the
monetary value of the units at the commencement of the performance period by the
Fair Market Value of a Common Share at such time, provided that such number of
shares may again become available for issuance under this Program as is provided
in paragraph 5 hereof.
11. NONTRANSFERABILITY.
Each Stock Option and Stock Appreciation Right granted under this
Program shall not be transferable other than by will or the laws of descent and
distribution, and shall be exercisable, during the participant's lifetime, only
by the participant. A participant's interest in a Performance Unit shall not be
transferable until payment or delivery of the award is made.
12. OTHER PROVISIONS.
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The award of any Benefit under the Program may also be subject to
other provisions (whether or not applicable to the Benefit awarded to any other
participant) as the Committee determines appropriate including, without
limitation, provisions for the purchase of Common Shares under Stock Options
under the Program in installments, provisions for the payment of the purchase
price of shares under Stock Options under the Program by delivery of other
Common Shares of the Company which have been owned for at least six months
having a then market value equal to the purchase price of such shares,
restrictions on resale or other disposition, such provisions as may be
appropriate to apply with federal or state securities laws and stock exchange
requirements and understandings or conditions as to the participant's employment
in addition to those specifically provided for under the Program.
The Committee may, in its discretion, permit payment of the purchase
price of shares under Stock Options under the Program by delivery of a properly
executed exercise notice together with a copy of irrevocable instructions to a
broker to deliver promptly to the Company the amount of sale or loan proceeds to
pay the purchase price. To facilitate the foregoing, the Company may enter into
agreements for coordinated procedures with one or more brokerage firms.
The Committee may, in its discretion and subject to such rules as it
may adopt, permit a participant to pay all or a portion of the federal, state
and local taxes, including FICA withholding tax, arising in connection with the
following transactions: (a) the exercise of a Non-qualified Stock Option; (b)
the lapse of restrictions on Common Shares received as a Restricted Stock Award;
or (c) the receipt or exercise of any other Benefit; by paying cash for such
amount or by electing (i) to have the Company withhold Common Shares, (ii) to
tender back Common Shares received in connection with such Benefit or (iii) to
deliver other previously acquired Common Shares of the Company, and, in each
case, having a Fair Market Value approximately equal to the amount to be
withheld.
13. TERM OF PROGRAM AND AMENDMENT, MODIFICATION, CANCELLATION OR
ACCELERATION OF BENEFITS.
No Benefit shall be granted more than ten (10) years after April 19,
1995, the date of the approval of this Program by the shareholders; provided,
however, that the terms and conditions applicable to any Benefits granted prior
to such date may at any time be amended, modified or cancelled by mutual
agreement between the Committee and the participant or such other persons as may
then have an interest therein, so long as any amendment or modification does not
increase the number of Common Shares issuable under this Program; and provided
further, that the Committee may, at any time and in its sole discretion, declare
any or all Stock Options and Stock Appreciation Rights then outstanding under
this Program or the Prior Stock Option Programs to be exercisable, any or all
then outstanding Restricted Stock Awards to be vested, and any or all then
outstanding Performance Units to have been earned, whether or not such options,
rights, awards or units are then otherwise exercisable, vested or earned.
14. AMENDMENT TO PRIOR STOCK OPTION PROGRAMS.
No options or other awards shall be granted under the Prior Stock
Option Programs on or after the date of shareholder approval of this Program.
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15. TAXES.
The Company shall be entitled to withhold the amount of any tax
attributable to any amount payable or shares deliverable under this Program
after giving the person entitled to receive such amount or shares notice as far
in advance as practicable, and the Company may defer making payment or delivery
if any such tax may be pending unless and until indemnified to its satisfaction.
16. DEFINITIONS.
FAIR MARKET VALUE. The term "Fair Market Value" of the Company's
Common Shares at any time shall be the average of the high and low sales prices
for the Company's Common Shares for the date, as reported on the New York Stock
Exchange.
SUBSIDIARY. The term "subsidiary" for all purposes other than the
Incentive Stock Option Plan described in paragraph 6, shall mean any
corporation, partnership, joint venture or business trust, fifty percent (50%)
or more of the control of which is owned, directly or indirectly, by the
Company. For Incentive Stock Option Plan purposes the term "subsidiary" shall
be defined as provided in Section 424(f) of the Code.
CHANGE IN CONTROL. A "Change in Control" shall be deemed to have
occurred if:
(a) any "person" as defined in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 (the "Exchange Act") is or becomes the
"beneficial owner" as defined in Rule 13d-3 under the Exchange Act,
directly or indirectly, of securities of the Company representing thirty
percent (30%) or more of the combined voting power of the Company's then
outstanding securities. For purposes of this clause (a), the term
"beneficial owner" does not include any employee benefit plan maintained by
the Company that invests in the Company's voting securities; or
(b) during any period of two (2) consecutive years (not including any
period prior to the date on which the Program was approved by the Company's
Board of Directors) there shall cease to be a majority of the Board
comprised as follows: individuals who at the beginning of such period
constitute the Board or new directors whose nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved; or
(c) the shareholders of the Company approve a merger or consolidation
of the Company with any other corporation, other than a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least 70% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately
after such merger or consolidation, or the shareholders of the Company
approve a plan of complete liquidation of the Company or an agreement for
the sale or disposition by the Company of all or substantially all the
Company's assets; provided, however, that no change in control will be
deemed to have occurred if such
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merger, consolidation, sale or disposition of assets, or liquidation is not
subsequently consummated.
STOCK OPTIONS. The term "Stock Options" shall mean Incentive Stock
Options and Non-qualified Stock Options under the Program and, if the context
includes the Prior Stock Option Programs, options granted under the Prior Stock
Option Programs.
DISABILITY. The term "disability" for all purposes of this Program
shall be determined by the Committee in such manner as the Committee deems
equitable or required by the applicable laws or regulations.
RETIREMENT. The term "retirement" for all purposes of the Program
shall be determined by the Committee in such manner as the Committee may deem
equitable or required by law.
17. ADJUSTMENT PROVISIONS.
If the Company shall at any time change the number of issued Common
Shares without new consideration to the Company (such as by stock dividends or
stock splits), the total number of shares reserved for issuance under this
Program, the maximum limit on awards to any person in any year in paragraph 4
hereof, and the number of shares covered by each outstanding Benefit shall be
adjusted so that the limitations, the aggregate consideration payable to the
Company, and the value of each such Benefit shall not be changed. The Committee
shall also have the right to provide for the continuation of Benefits or for
other equitable adjustments after changes in the Common Shares resulting from
reorganization, sale, merger, consolidation or similar occurrence.
Notwithstanding any other provision of this Program, and without
affecting the number of shares otherwise reserved or available hereunder, the
Committee may authorize the issuance or assumption of Benefits in connection
with any merger, consolidation, acquisition of property or stock, or
reorganization upon such terms and conditions as it may deem appropriate.
Subject to the six month holding requirements of paragraphs 6, 7, 8(c)
and 9 but notwithstanding any other provision of this Program or the Prior Stock
Option Programs, upon the occurrence of a Change in Control:
(a) All Stock Options then outstanding under this Program shall
become fully exercisable as of the date of the Change in Control, whether
or not then otherwise exercisable;
(b) All Stock Appreciation Rights then outstanding shall become fully
exercisable as of the date of the Change in Control, whether or not then
otherwise exercisable;
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(c) All terms and conditions of all Restricted Stock Awards then
outstanding shall be deemed satisfied and all such Awards shall vest as of
the date of the Change in Control; and
(d) All Performance Units then outstanding shall be deemed to have
been fully earned as determined by the Committee and to be immediately
payable, in cash, as of the date of the Change in Control and shall be paid
within thirty (30) days thereafter.
Provided, however, that no change in vesting or exerciseability shall occur
as a result of the foregoing provisions on or before April 19, 1997 without the
express advance approval of the Committee.
18. AMENDMENT AND TERMINATION OF PROGRAM.
The Committee may amend this Program from time to time or terminate
this Program at any time, but no such action shall reduce the then existing
amount of any participant's Benefit or adversely change the terms and conditions
thereof without the participant's consent. No amendment of this Program shall
result in any Committee member losing his or her status as a "disinterested
person" as defined in Rule 16b-3 of the Securities and Exchange Commission with
respect to any employee benefit plan of the Company or result in the program
losing its status as a protected plan under said Rule 16b-3.
19. SHAREHOLDER APPROVAL.
This Program was adopted by the Board of Directors of the Company on
January 24, 1995. This Program and any Benefit granted thereunder shall be null
and void if shareholder approval is not obtained within twelve (12) months of
the adoption of the Program by the Board of Directors.
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12-14-94
TCF DIRECTORS DEFERRED COMPENSATION PLAN
This is an amendment and restatement of the Director Fee Deferral Plan (the
"Prior Plan") previously in effect for directors of TCF Financial Corporation
("TCF Financial") and TCF Bank Minnesota fsb ("TCF Minnesota"). From and after
January 1, 1995, the effective date of this amendment and restatement, the Prior
Plan shall be renamed to be the TCF Directors Deferred Compensation Plan (the
"Plan"). Except as may be specifically stated otherwise herein, all provisions
of this restatement are effective for fees earned on and after January 1, 1995.
1. DEFERRAL OF STOCK OR FEES.
a. From time to time eligible directors ("Directors") of TCF
Financial, TCF Minnesota, TCF Bank Illinois fsb ("TCF Illinois"), TCF Bank
Michigan fsb ("TCF Michigan") or TCF Bank Wisconsin fsb ("TCF Wisconsin") (each
such corporation being referred to hereinafter as the "Company") may, by written
notice, elect to have payment of all or a portion of their director's fees for
the next succeeding calendar year, and/or all or a portion of any grant of
shares of common stock of TCF Financial ("TCF Stock") to the Director made on
or after such election deferred as hereinafter provided. Each such deferral of
fees or TCF Stock shall be (and is hereinafter referred to as) a "Deferred
Amount." Notwithstanding the foregoing, however, a Director may not elect to
defer any portion of fees or TCF Stock unless such Director's deferrals with
respect to such year are in round percentage increments of 10%.
b. Any elections with respect to Deferred Amounts of fees or TCF
Stock shall be exercised in writing by the Director prior to the latest to occur
of the following: (i) the beginning of the calendar year for which the fees
are to be earned; (ii) such Director's first day of board service in that year;
(iii) the thirty-first day following the date the Director first becomes
eligible to participate in the Plan; PROVIDED THAT, an election made after the
first day of a calendar year shall only apply to fees earned after the date of
the election. Notwithstanding the foregoing, in the case of directors who file
reports of their TCF Stock ownership on Form 4 with the Securities and Exchange
Commission, the election shall be no later than the date specified in the
preceding sentence or, if earlier, six months prior to the date on which any
fees deferred by the Director are invested in TCF Stock and that in the case of
deferral of grants of TCF Stock, the election shall be made no later than the
date specified in the preceding sentence or, if earlier, the effective date of
the grant of TCF Stock. An election of Deferred Amounts, once made, is
irrevocable, except as provided in paragraph 6 hereof. An election of Deferred
Amounts, once made, shall continue to be effective for succeeding calendar years
until revoked by the Director by written request to the Secretary of TCF
Financial prior to the beginning of a calendar year for which fees would
otherwise be deferred.
c. Deferred Amounts shall be subject to the rules set forth in this
document, and each Director shall have the right to receive cash payments on
account of previously Deferred Amounts only in the amounts and under the
circumstances hereinafter set forth.
d. Directors eligible to participate in this Plan are non-employee
Directors of TCF Financial, TCF Minnesota, TCF Illinois, TCF Michigan, TCF
Wisconsin or any other insured institution subsidiary of TCF Financial from time
to time. Eligibility shall be determined annually as of the latest practicable
date prior to the commencement of each new calendar year. In the event a
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Director ceases to be eligible for this Plan during the course of a calendar
year, the Director's eligibility shall nevertheless continue through the end of
that calendar year with respect to fees earned prior to cessation of service.
2. ADMINISTRATIVE COMMITTEE. Full power and authority to construe,
interpret, and administer this document, shall be vested in the Administrative
Committee (the "Committee") of the Board of Directors of TCF Financial, which
shall consist of the employee directors of TCF Financial, subject to the
requirement that no member of the Committee shall at any time be a person
eligible for participation in this Plan, and shall not have been eligible for
participation in this Plan at any time during the one-year period prior to
becoming a member of the Committee. The Committee shall have full power and
authority to make each determination provided for in this document, and in this
connection, to promulgate such rules and regulations as the Committee considers
necessary or appropriate for the implementation and management of this Plan.
All determinations made by the Committee shall be conclusive upon the Companies,
each Director and former Director and their designees, heirs and assigns.
3. DEFERRED COMPENSATION ACCOUNTS. Each Company shall establish on its
books a separate account ("Account") for each of its Directors who becomes a
participant in this Plan, and each such Account shall be maintained as follows:
a. Each Account shall be credited with the Deferred Amounts elected
by the Director for whom such Account is established as of the date on which
such Deferred Amount would otherwise have been paid to the Director.
b. The value of a Director's Account is to be measured by the value
of and income from TCF Stock, in which all Deferred Amounts shall be deemed to
be invested, however such value is merely a measuring device to determine the
payments to be made to each Director hereunder. Each Director, and each other
recipient of a Director's Deferred Amounts pursuant to paragraph 7, shall be and
remain an unsecured general creditor of the Company on whose board the Director
serves with respect to any payments due and owing to such Director hereunder.
If a Company should from time to time, in its discretion, actually purchase the
investments deemed to have been made for a Director's Account, either directly
or through the trust described in paragraph 4, such investments shall be solely
for the Company's or such trust's own account, and the Directors shall have no
right, title or interest therein.
c. At the time a Director makes his or her first election described
in paragraph 1.b., the Director may also consent to have Deferred Amounts
contributed to the trust described in paragraph 4, and to have the Director's
Account adjusted as provided in paragraph 4 from the date as of which it is
established. Any such consent, if granted, shall be irrevocable as to the
Director, and shall apply to all of the Director's Deferred Amounts. Any
consent given pursuant to this paragraph 3.d. shall in no way obligate any
Company to make contributions to the trust described in paragraph 4, such
contributions being in each Company's discretion as provided in paragraph 4.
4. TRUST. TCF Financial may establish a trust (of the type commonly
known as a "rabbi trust") to aid in the accumulation of assets for payment of
Deferred Amounts. In the event that such a trust is established, the amounts
credited to the Directors' Accounts shall be adjusted as follows:
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a. Each Company may, in its discretion, contribute to the trust an
amount equal to the balance credited to the Account of each Director (other than
Directors who have not made the election described in paragraph 3.c.) serving on
the board of such Company on the date of such contribution. Thereafter, each
Company may, in its discretion, contribute to the trust an amount equal to the
Deferred Amounts of the Directors on the board of such Company within five
business days after the Deferred Amount would otherwise be paid to the Director.
The assets of the trust shall be invested in TCF Stock, subject to the Company's
right to substitute assets of equal value as provided in the Trust. The terms
of the Trust shall be consistent with the terms of this Plan. The Trustee shall
be a corporate trustee independent of the Company and shall conform to the
provisions of the "model trust," as described in Rev. Proc. 92-64. Nothing
herein shall be construed as requiring the Company to make any contributions to
the trust. To the extent such contributions are actually made, the trust assets
shall remain subject to the claims of the Company's general creditors in the
event of its insolvency.
b. The Trust shall provide for separate accounts in the name of each
Director who has elected a Deferred Amount and shall be deemed to be a separate
trust for each Company contributing to the Trust. Except as provided in
paragraph 4.d., from and after the date as of which such accounts are
established, the balances in the Accounts established for Directors pursuant to
this Plan shall be equal to the balances credited to such separate accounts.
Each such separate account shall then be adjusted as follows:
(i) Contributions made by the Companies to the trust on behalf
of such Director, and all dividends or other distributions made with
respect to property allocated to such separate account, shall be credited
to such separate account and invested in TCF Stock.
(ii) Each Director's separate account shall be increased by the
amount of any increase in the fair market value, as determined by the
Trustee, of any assets allocated to such separate account, and shall be
decreased by any decrease in the fair market value of such assets, as
determined by the Trustee.
(iii) Each Director's separate account shall be reduced by any
distributions made to the Director from the Trust which are chargeable to
such separate account.
c. A Director's separate account shall continue during any period of
distribution subsequent to the Director's termination of service on the board to
be invested in TCF Stock.
d. The adjustments described in this paragraph 4 shall only be made
to a Director's Account to the extent that a Company has made contributions to
the trust pursuant to this paragraph 4. If for any reason such contributions
have not been made then, and only to that extent, the Director's Account shall
be adjusted as provided in paragraph 3.b.
5. PAYMENT OF DEFERRED AMOUNTS. At the next regularly scheduled meeting
of the Committee following a Director's termination of service on the board (as
defined herein), the Committee shall direct the Trustee to commence distribution
of the amounts credited to such Director's Account. Commencing within the 30
day period following the Committee's direction, the balance credited to the
Director's Account shall be paid in one lump sum or in annual installments
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over the period directed by the Director in an election made upon the Director's
commencement of participation in the Plan.
b. The first payment under paragraph 5.a. shall be paid on a date
selected by the Committee which is no later than 30 days after the date on which
the Committee's direction as to the form and timing of distributions is made.
Succeeding installments (if any) shall be paid on January 31 of each calendar
year following the calendar year in which the first payment was made.
c. Each payment shall be made in cash or in kind as the Committee,
in its discretion, shall determine, and each annual installment payment shall
have a value equal to the amount credited to Director's Account as of the first
day of the calendar month in which the installment is paid multiplied by a
fraction, the numerator of which is one and the denominator of which is the
number of installments remaining to be paid, including the current installment.
d. For purposes of this section, a Director's service on the board
is considered to terminate as of the date which is the later of (i) Director's
last date of service for the Company as a director, or (ii) the Director's last
date of service on the board of directors of any Company.
e. In the event installment payments commence and any installments
are unpaid at the time of Director's death, the payments shall be made at the
times and in such amounts as if Director were living to the persons specified in
paragraph 7.a.
f. Notwithstanding any other provision of this Section 5 or any
payment schedule directed by a Director pursuant to this Section 5 and
regardless of whether payments have commenced under this Section 5, in the event
that the Internal Revenue Service should finally determine that part or all of
the value of a Director's Deferred Amounts or Plan Account which have not
actually been distributed to the Director, or that part or all of a related
Trust Account which has not actually been distributed to the Director, is
nevertheless required to be included in the Director's gross income for federal
and/or State income tax purposes, then the Deferred Amounts or the Account or
the part thereof that was determined to be includible in gross income shall be
distributed to the Director in a lump sum as soon as practicable after such
determination without any action or approval by the Committee. A "final
determination" of the Internal Revenue Service for purposes of this paragraph
5.i. is a determination in writing by said Service ordering the payment of
additional tax, reporting of additional gross income or otherwise requiring Plan
amounts to be included in gross income, which is not appealable or which the
Director does not appeal within the time prescribed for appeals.
6. EMERGENCY PAYMENTS. In the event of an "unforeseeable emergency" as
determined hereafter, the Committee may determine the amounts payable under
paragraph 5 hereof and pay all or a part of such amounts without regard to the
payment dates provided in paragraph 5 to the extent the Committee determines
that such action is necessary in light of immediate and heavy needs of the
Director (or his beneficiary) occasioned by severe financial hardship. For the
purposes of this paragraph 6, an "unforeseeable emergency" is a severe financial
hardship to the Director resulting from a sudden and unexpected illness or
accident of the Director or beneficiary, or of a dependent (as defined in
Section 152(a) of the Internal Revenue Code of 1986, as amended) of the Director
or beneficiary, loss of the Director's or beneficiary's property due to
casualty, or other similar extraordinary and unforeseeable circumstances arising
as a result of events beyond the control of the Director or beneficiary.
Payments shall not be made pursuant to this paragraph 6 to the extent that
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such hardship is or may be relieved: (a) through reimbursement or compensation
by insurance or otherwise, (b) by liquidation of the Director's or beneficiary's
assets, to the extent the liquidation of such assets would not itself cause
severe financial hardship, or (c) by cessation of the Director's deferrals under
the Plan. Such action shall be taken only if Director (or Director's legal
representatives or successors) signs an application describing fully the
circumstances which are deemed to justify the payment, together with an estimate
of the amounts necessary to prevent such hardship, which application shall be
approved by the Committee after making such inquiries as the Committee deems
necessary or appropriate.
7. METHOD OF PAYMENTS.
a. In the event of Director's death, payments shall be made to the
persons (including a trustee or trustees) named in the last written instrument
signed by Director and received by the Committee prior to Director's death, or
if Director fails to so name any person, the amounts shall be paid to Director's
estate or the appropriate distributee thereof. The Committee, the Company, and
the Trustee shall be fully protected in making any payments due hereunder in
accordance with what the Committee believes to be such last written instrument
received by it.
b. Payments due to a legally incompetent person may be made in such
of the following ways as the Committee shall determine:
(i) directly to such incompetent person,
(ii) to the legal representative of such incompetent person, or
(iii) to some near relative of the incompetent person to be used
for the latter's benefit.
c. Except as otherwise provided in paragraphs 7.a. and b., all
payments to persons entitled to benefits hereunder shall be made to such persons
in person or upon their personal receipt or endorsement, and shall not be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment or garnishment by creditors of the participant
or the participant's beneficiary.
d. All payments to persons entitled to benefits hereunder shall be
made out of the general assets, and shall be the sole obligations, of the
Companies, except to the extent that such payments are made out of the trust
described in paragraph 4. The Plan is a mere promise to pay benefits in the
future and it is the intention of the parties that it be "unfunded" for tax
purposes (and for the purposes of Title I of the Employee Retirement Income
Security Act of 1974 ("ERISA")).
8. CLAIMS PROCEDURES.
a. If a claim for benefits made by any person (the "Applicant") is
denied, the Committee shall furnish to the Applicant within 90 days after its
receipt of such claim (or within 180 days after such receipt if special
circumstances require an extension of time) a written notice which: (i)
specifies the reasons for the denial, (ii) refers to the pertinent provisions of
the Plan on which the denial is based, (iii) describes any additional material
or information necessary for the perfection of
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the claim and explains why such material or information is necessary, and (iv)
explains the claim review procedures.
b. Upon the written request of the Applicant submitted within 60
days after his receipt of such written notice, the Committee shall afford the
Applicant a full and fair review of the decision denying the claim and, if so
requested: (i) permit the Applicant to review any documents which are pertinent
to the claim, (ii) permit the Applicant to submit to the Committee issues and
comments in writing, and (iii) afford the Applicant an opportunity to meet with
a quorum of the Committee as a part of the review procedure.
c. Within 60 days after its receipt of a request for review (or
within 120 days after such receipt if special circumstances, such as the need to
hold a hearing, require an extension of time) the Committee shall notify the
Applicant in writing of its decision and the reasons for its decision and shall
refer the Applicant to the provisions of the Plan which form the basis for its
decision.
9. MISCELLANEOUS.
a. Except as limited by paragraph 7.c. and except that a Director
shall have a continuing power to designate a new recipient in the event of
Director's death at any time prior to such death without the consent or approval
of any person theretofore named as Director's recipient by an instrument meeting
the requirements of paragraph 7.a., this document shall be binding upon and
inure to the benefit of each Company, Director, their legal representatives,
successors and assigns, and all persons entitled to benefits hereunder.
b. Any notice given in connection with this document shall be in
writing and shall be delivered in person or by registered mail, return receipt
requested. Any notice given by registered mail shall be deemed to have been
given upon the date of delivery indicated on the registered mail return receipt,
if correctly addressed.
c. Nothing in this document shall interfere with the rights of any
Director to participate or share in any profit sharing or pension plan which is
now in force or which may at some future time become a recognized plan of any
Company.
d. Nothing in this document shall be construed as an employment
agreement nor as in any way impairing the right of any Company, its board,
committees or shareholders, to remove the Director from service as a director,
to refuse to renominate or reelect such person as a director, or to enforce the
duly adopted retirement policies of the board of directors of such Company.
10. RULE 16B-3; STOCKHOLDER APPROVAL. This Plan is intended to
qualify for the exemption from short swing profits liability under Section 16(b)
of the Securities Exchange Act of 1934 provided by Rule 16b-3 of the Securities
and Exchange Commission. If required by such rule, the adoption of this Plan
shall be contingent upon the approval of the Plan and any material amendments
thereto by the stockholders of TCF Financial Corporation on or before the date
of the Annual Stockholders meeting for 1995.
11. REGISTRATION; NYSE LISTING. TCF Financial may, in its
discretion, register the shares of TCF Stock subject to this Plan under the
Securities Act of 1933 and any other applicable
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provisions of State or Federal law, and may enter into a listing agreement for
such shares with the New York Stock Exchange, if such actions are deemed
necessary or advisable by TCF Financial in order to provide directors with
freely marketable shares. However, nothing herein shall be deemed to require
any such registration or listing.
12. ACCOUNTS IN THE PRIOR PLAN. A Director with an account
balance in the Prior Plan as of December 31, 1994 may elect to have such balance
invested in TCF Stock and may consent to contributions to the Trust for such
deemed investment in TCF Stock, provided that the election is made no later than
December 31, 1994 and that the resulting investment in TCF Stock occurs no
sooner than six months after such election, if the Director is subject to
reporting requirements under section 16(a) of the Securities Exchange Act of
1934. If a Director does not elect to transfer the Prior Plan account balance
into TCF Stock, such account balance shall continue to be deemed to be invested
in the "treasury bill rate" set forth in the Prior Plan.
13. TERMINATION OR AMENDMENT. The Board of Directors of TCF Financial
may, in its discretion, terminate or amend this document from time to time,
provided, however, that no such termination or amendment shall (without the
Director's consent) alter any Director's right to payments of amounts previously
credited to such Director's Account or delay the time or times at which an
Director is entitled to receive payments with respect to his Deferred Amounts.
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TCF DIRECTORS DEFERRED COMPENSATION TRUST
(a) This Agreement made effective as of the 29th day of July, 1994 by and
between TCF Financial Corporation ("TCF Financial") and any subsidiary thereof
whose directors are eligible for a plan listed in the Appendix (TCF Financial
and the subsidiaries are individually each referred to herein as the "Company")
and Piper Trust Company ("Trustee");
(b) WHEREAS, Company has adopted the nonqualified deferred compensation
plan(s) as listed in the Appendix ( the "Plan").
(c) WHEREAS, Company has incurred or expects to incur liability under the
terms of such Plan(s) with respect to the individuals participating in such
Plan(s).
(d) WHEREAS, Company wishes to establish a trust (hereinafter called
"Trust") and to contribute to the Trust assets that shall be held therein,
subject to the claims of Company's creditors in the event of Company's
Insolvency, as herein defined, until paid to Plan participants and their
beneficiaries in such manner and at such times as specified in the Plan(s);
(e) WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the
Plan(s) as an unfunded plan maintained for the purpose of providing deferred
compensation for non-employee directors;
(f) WHEREAS, it is the intention of Company to make contributions to the
Trust to provide itself with a source of funds to assist it in the meeting of
its liabilities under the Plan(s);
NOW, THEREFORE, the parties do hereby establish the Trust and agree that
the Trust shall be comprised, held and disposed of as follows:
Section 1. ESTABLISHMENT OF TRUST
(a) Company hereby deposits with Trustee in trust shares of common stock,
TCF Financial Corporation, par value $.01 per share ("TCF Stock"), which shall
become the principal of the Trust to be held, administered and disposed of by
Trustee as provided in this Trust Agreement.
(b) The Trust shall become irrevocable upon approval by the Board of
Directors of TCF Financial.
(c) The Trust is intended to be a grantor trust, of which Company is the
grantor, within the meaning of subpart E, part I, subchapter J, chapter 1,
subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
(d) The principal of the Trust, and any earnings thereon shall be held
separate and apart from other funds of Company and shall be used exclusively for
the uses and purposes of Plan participants and general creditors as herein set
forth. Plan participants and their
1
<PAGE>
beneficiaries shall have no preferred claim on, or any beneficial ownership
interest in, any assets of the Trust. Any rights created under the Plan(s) and
this Trust Agreement shall be mere unsecured contractual rights of Plan
participants and their beneficiaries against Company. Any assets held by the
Trust will be subject to the claims of Company's general creditors under federal
and state law in the event of Insolvency, as defined in Section 3(a) herein.
(e) Company, in its sole discretion, may at any time, or from time to
time, make additional deposits of cash or other property in trust with Trustee
to augment the principal to be held, administered and disposed of by Trustee as
provided in this Trust Agreement. Neither Trustee nor any Plan participant or
beneficiary shall have any right to compel such additional deposits.
Section 2. PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES.
(a) Company shall deliver to Trustee a schedule (the "Payment Schedule")
that indicates the amounts payable in respect of each Plan participant (and his
or her beneficiaries), that provides a formula or other instructions acceptable
to Trustee for determining the amounts so payable, the form in which such amount
is to be paid (as provided for or available under the Plan(s)), and the time of
commencement for payment of such amounts. Except as otherwise provided herein,
Trustee shall make payments to the Plan participants and their beneficiaries in
accordance with such Payment Schedule. The Trustee shall make provision for the
reporting and withholding of any federal, state or local taxes that may be
required to be withheld with respect to the payment of benefits pursuant to the
terms of the Plan(s) and shall pay amounts withheld to the appropriate taxing
authorities or determine that such amounts have been reported, withheld and paid
by Company.
(b) The entitlement of a Plan participant or his or her beneficiaries to
benefits under the Plan(s) shall be determined by Company or such party as it
shall designate under the Plan(s), and any claim for such benefits shall be
considered and reviewed under the procedures set out in the Plan(s).
(c) Company may make payment of benefits directly to Plan participants or
their beneficiaries as they become due under the terms of the Plan(s). Company
shall notify Trustee of its decision to make payment of benefits directly prior
to the time amounts are payable to participants or their beneficiaries. In
addition, if the principal of the Trust, and any earnings thereon, are not
sufficient to make payments of benefits in accordance with the terms of the
Plan(s), Company shall make the balance of each such payment as it falls due.
Trustee shall notify Company where principal and earnings are not sufficient.
Section 3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST BENEFICIARY
WHEN COMPANY IS INSOLVENT.
(a) Trustee shall cease payment of benefits to Plan participants and their
beneficiaries if the Company is Insolvent. Company shall be considered
"Insolvent" for
2
<PAGE>
purposes of this Trust Agreement if (i) Company is unable to pay its debts as
they become due, or (ii) Company is subject to a pending proceeding as a debtor
under the United States Bankruptcy Code, or (iii) Company is determined to be
insolvent by the Office of Thrift Supervision or the Federal Deposit Insurance
Corporation.
(b) At all times during the continuance of this Trust, as provided in
Section 1(d) hereof, the principal and income of the Trust shall be subject to
claims of general creditors of Company under federal and state law as set forth
below.
(1) The Board of Directors and the Chief Executive Officer of Company
shall have the duty to inform trustee in writing of Company's Insolvency. If a
person claiming to be a creditor of Company alleges in writing to Trustee that
Company has become Insolvent, Trustee shall determine whether Company is
Insolvent and, pending such determination, Trustee shall discontinue payment of
benefits to Plan participants or their beneficiaries.
(2) Unless Trustee has actual knowledge of Company's Insolvency, or has
received notice from Company or a person claiming to be a creditor alleging
that Company is Insolvent, Trustee shall have no duty to inquire whether Company
is Insolvent. Trustee may in all events rely on such evidence concerning
Company's solvency as may be furnished to Trustee and that provides Trustee with
a reasonable basis for making a determination concerning Company's solvency.
(3) If at any time Trustee has determined that Company is Insolvent,
Trustee shall discontinue payments to Plan participants or their beneficiaries
and shall hold the assets of the Trust for the benefit of Company's general
creditors. Nothing in this Trust Agreement shall in any way diminish any rights
as of Plan participants or their beneficiaries as general creditors of Company
with respect to benefits due under the Plan(s) or otherwise.
(4) Trustee shall resume the payment of benefits to Plan participants or
their beneficiaries in accordance with Section 2 of this Trust Agreement only
after Trustee has determined that Company is not Insolvent (or is no longer
Insolvent).
(c) Provided that there are sufficient assets, if Trustee discontinues the
payment of benefits from the Trust pursuant to Section 3(b) hereof and
subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to Plan
participants or their beneficiaries under the terms of the Plan(s) for the
period of such discontinuance, less the aggregate amount of any payments made
to Plan participants or their beneficiaries by Company in lieu of the payments
provided for hereunder during any such period of discontinuance.
Section 4. PAYMENTS TO COMPANY.
Except as provided in Section 3 hereof, after the Trust has become
irrevocable, Company shall have no right or power to direct Trustee to return to
Company or to divert to others any of the Trust assets before all payment of
benefits have been made to Plan participants and their beneficiaries pursuant to
the terms of the Plan(s).
3
<PAGE>
Section 5. INVESTMENT AUTHORITY.
(a) Trustee may invest in securities (including stock or rights to acquire
stock) or obligations issued by Company. All rights associated with assets of
the Trust shall be exercised by Trustee or the person designated by Trustee, and
shall in no event be exercisable by or rest with Plan participants except that
voting rights with respect to Trust assets will be exercised by TCF Financial.
Company shall have the right at anytime, and from time to time in its sole
discretion, to substitute assets of equal fair market value for any asset held
by the Trust. This right is exercisable by Company in a nonfiduciary capacity
without the approval or consent of any person in a fiduciary capacity.
Section 6. DISPOSITION OF INCOME.
(a) During the term of this Trust, all income received by the Trust, net
of expenses and taxes, shall be accumulated and reinvested.
Section 7. ACCOUNTING BY TRUSTEE.
Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made,
including such specific records as shall be agreed upon in writing between
Company and Trustee. Within 90 days following the close of each calendar year
and within 30 days after the removal or resignation of Trustee, Trustee shall
deliver to Company a written account of its administration of the Trust during
such year or during the period from the close of the last preceding year to the
date of such removal or resignation, setting forth all investments, receipts,
disbursements, and other transactions effected by it, including a description of
all securities and investments purchased and sold with the cost or net proceeds
of such purchases or sales (accrued interest paid or receivable being shown
separately), and showing all cash, securities and other property held in the
Trust at the end of such year or as of the date of such removal or resignation,
as the case may be.
Section 8. RESPONSIBILITY OF TRUSTEE.
(a) Trustee shall act with the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent person acting in like capacity
and familiar with such matters would use in the conduct of an enterprise of a
like character and with like aims, provided, however, that Trustee shall incur
no liability to any person for any action taken pursuant to a direction,
request or approval given by Company which is contemplated by, and in
conformity, the terms of the Plan(s) or this Trust and is given in writing by
Company. In the event of a dispute between Company and a party, Trustee may
apply to a court of competent jurisdiction to resolve the dispute.
4
<PAGE>
(b) If Trustee undertakes or defends any litigation arising in connection
with this Trust, Company agrees to indemnify Trustee against Trustee's costs,
expenses and liabilities (including, without limitation, attorneys' fees and
expenses) relating thereto and to be primarily liable for such payments. If
Company does not pay such costs, expenses and liabilities in a reasonably timely
manner, Trustee may obtain payment from the Trust.
(c) Trustee may consult with legal counsel (who may also be counsel for
Company generally) with respect to any of its duties or obligations hereunder.
(d) Trustee may hire agents, accountants, actuaries, investment advisors,
financial consultants or other professionals to assist it in performing any of
its duties or obligations hereunder.
(e) Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided otherwise herein,
provided, however, that if an insurance policy is held as an asset of the Trust,
Trustee shall have no power to name a beneficiary of the policy other than the
Trust, to assign the policy (as distinct from conversion of the policy to a
different form) other than to a successor Trustee, or to loan to any person the
proceeds of any borrowing against such policy.
(f) Notwithstanding any powers granted to Trustee pursuant to this Trust
Agreement or to applicable law, Trustee shall not have any power that could give
this Trust the objective of carrying on a business and dividing the gains
therefrom, within the meaning of section 301.7701-2 of the Procedure and
Administrative Regulations promulgated pursuant to the Internal Revenue Code.
Section 9. COMPENSATION AND EXPENSES OF TRUSTEE.
Company shall pay all administrative and Trustee's fees and expenses. If
not so paid, the fees and expenses shall be paid from the Trust.
Section 10. RESIGNATION AND REMOVAL OF TRUSTEE.
(a) Trustee may resign at any time by written notice to Company, which
shall be effective 30 days after receipt of such notice unless Company and
Trustee agree otherwise.
(b) Trustee may be removed by Company on 30 days notice or upon shorter
notice accepted by Trustee, except as provided below.
(c) Upon a Change of Control, as defined herein, Trustee may not be
removed by Company for three years.
(d) If Trustee resigns or is removed within three years of a Change of
Control, as defined herein, Trustee shall select a successor Trustee in
accordance with the provisions of Section 11(b) hereof prior to the effective
date of Trustee's resignation or removal.
(e) Upon resignation or removal of Trustee and appointment of a successor
Trustee, all assets shall subsequently be transferred to the successor Trustee.
The transfer shall be completed within 30 days after receipt of notice of
resignation, removal or transfer, unless Company extends the time limit.
5
<PAGE>
(f) If Trustee resigns or is removed, a successor shall be appointed, in
accordance with section 11 hereof, by the effective date of resignation or
removal under paragraph (a) or (b) of this section. If no such appointment has
been made, Trustee may apply to a court of competent jurisdiction for
appointment of a successor or for instructions. All expenses of Trustee in
connection with the proceeding shall be allowed as administrative expenses of
the Trust.
Section 11. APPOINTMENT OF SUCCESSOR.
(a) If Trustee resigns or is removed in accordance with Section 10(a) or
(b) hereof, Company may appoint any third party, such as a bank trust department
or other party that may be granted corporate trustee powers under state law, as
a successor to replace Trustee upon resignation or removal. The appointment
shall be effective when accepted in writing by the new Trustee, who shall have
all of the rights and powers of the former Trustee, including ownership rights
in the Trust assets. The former Trustee shall execute any instrument necessary
or reasonably requested by Company or the successor Trustee to evidence the
transfer.
(b) If Trustee resigns or is removed pursuant to the provisions of Section
10(d) hereof and selects a successor Trustee, Trustee may appoint any third
party such as a bank trust department or other party that may be granted
corporate trustee powers under state law. The appointment of a successor
Trustee shall be effective when accepted in writing by the new Trustee. The new
Trustee shall have all the rights and powers of the former Trustee, including
ownership rights in Trust assets. The former Trustee shall execute any
instrument necessary or reasonably requested by the successor Trustee to
evidence the transfer.
(c) The successor Trustee need not examine the records and acts of any
prior Trustee and may retain or dispose of existing Trust assets, subject to
Sections 7 and 8 hereof. The successor Trustee shall not be responsible for and
Company shall indemnify and defend the successor Trustee from any claim or
liability resulting from any action or inaction of any prior Trustee or from any
other past event, or any condition existing at the time it becomes successor
Trustee.
Section 12. AMENDMENT OR TERMINATION.
(a) This Trust Agreement may be amended by a written instrument executed
by Trustee and Company. Notwithstanding the foregoing, no such amendment shall
conflict with the terms of the Plan(s) or shall make the Trust revocable after
it has become irrevocable in accordance with Section 1(b) hereof.
(b) The Trust shall not terminate until the date on which Plan
participants and their beneficiaries are no longer entitled to benefits pursuant
to the terms of the Plan(s). Upon termination of the Trust, any assets
remaining in the Trust shall be returned to Company.
6
<PAGE>
(c) Upon written approval of participants or beneficiaries entitled to
payment of benefits pursuant to the terms of the plan(s), Company may terminate
this Trust prior to the time all benefit payments under the Plan(s) have been
made. All assets in the Trust at termination shall be returned to Company.
(d) Sections 1(b), 5, 10, 11, 12 and 13 of this Trust Agreement may not be
amended by Company for three years following a Change of Control, as defined
herein.
Section 13. MISCELLANEOUS.
(a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.
(b) Benefits payable to Plan participants and their beneficiaries under
the Trust Agreement may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered or subjected to attachment, garnishment,
levy, execution or other legal or equitable process.
(c) This Trust Agreement shall be governed by and construed in accordance
with the laws of the State of Minnesota.
(d) For purposes of this Trust, Change of Control shall mean each of the
events specified in the following clauses (i) through (iii), (i) any third
person, including a "group" as defined in section 13(d)(3) of the Securities
Exchange Act of 1934, as amended, shall become the beneficial owner of the
shares of TCF Financial with respect to which 25% or more of the total number of
votes for the election of the Board of Directors of TCF Financial may be cast,
(ii) as a result of, or in connection with, any cash tender offer, exchange
offer, merger, or other business combination, sale of assets, or contested
election, or combination of the foregoing, the persons who were directors of TCF
Financial shall cease to constitute a majority of the Board of Directors of TCF
Financial, or (iii) the shareholders of TCF Financial shall approve an agreement
providing either for a transaction in which TCF Financial will cease to be an
independent publicly owned corporation or for a sale or other disposition of all
or substantially all the assets of TCF Financial; provided, however, that the
occurrence of any such events shall not be deemed a "change of control" if,
prior to such occurrence, a resolution specifically approving such occurrence
shall have been adopted by at least a majority of the Board of Directors of TCF
Financial.
Section 14. EFFECTIVE DATE.
The effective date of this Trust Agreement shall be July 29, 1994.
7
<PAGE>
TCF
APRIL 19, 1995
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PROXY
The undersigned hereby appoints William A. Cooper and Gregory J. Pulles, or
either of them, as proxies with full power of substitution, to vote all shares
of Common Stock of TCF Financial Corporation of record in the name of the
undersigned at the close of business on March 1, 1995, at the Annual Meeting of
Stockholders to be held on April 19, 1995, or at any adjournment thereof, hereby
revoking all former proxies, on the items set forth on the reverse side hereof,
as described in the accompanying Proxy Statement and upon such other business as
may properly come before the Meeting including: any matters which the Board of
Directors did not know, a reasonable time before mailing this solicitation,
would be presented at the Meeting; approval of minutes of the prior annual and
prior special stockholders meetings; election of any person as director in place
of a nominee who is unable to serve or who for good cause will not serve; and
matters incident to the conduct of the Meeting.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE) /SEE REVERSE SIDE/
<PAGE>
/x/ Please mark votes as in this example.
Unless otherwise indicated, all signed proxy cards received will be voted "FOR"
all proposals referred to herein. The Board of Directors recommends that you
vote "FOR" all proposals.
1. Election of Directors
NOMINEES: Joseph P. Clifford, Robert E. Evans,
Luella G. Goldberg, Ralph Strangis, Mark K. Rosenfeld.
FOR / / WITHHELD / /
/ / MARK HERE / /
- - -------------------------------------- FOR ADDRESS
For all nominees except as written on CHANGE AND
the line above. NOTE BELOW
FOR AGAINST ABSTAIN
2. Appointment of KPMG Peat / / / / / /
Marwick LLP as independent
public accountants for 1995.
3. Approve increase in the / / / / / /
maximum permissible size of
the Board of Directors from
15 to 25.
4. Approve the TCF Financial / / / / / /
1995 Incentive Stock
Program.
5. Approve the TCF Directors / / / / / /
Deferred Compensation Plan
and Trust.
NOTE: Please sign as name appears hereon.
In case of joint owners, each owner should sign. When signing in a fiduciary or
representative capacity, please give full title as such. Proxies executed by a
corporation should be signed in full corporate name by a duly authorized
officer. For partnerships, please sign in partnership name by authorized
person.
Signature: Date
-------------------------------------------- --------------------
Signature: Date
-------------------------------------------- --------------------
<PAGE>
TCF
APRIL 19, 1995
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PROXY
To: First Trust National Association as Trustee under the Trust Agreement for
the TCF Employees Stock Ownership Plan--401(k).
The Trustee named above is hereby instructed to vote (by proxy, in the form
solicited by the Board of Directors, or in person) all the shares or fractional
shares of Common Stock of TCF Financial Corporation which are credited to the
undersigned's account(s) as of the latest available processing date on or before
March 1, 1995, at the Annual Meeting of Stockholders to be held on April 19,
1995, and any adjournment thereof, on the items set forth on the reverse hereof,
as described in the accompanying Proxy Statement and upon such other business as
may properly come before the Meeting including: any matters which the Board of
Directors did not know, a reasonable time before mailing this solicitation,
would be presented at the Meeting; approval of minutes of the prior annual and
prior special stockholders meetings; election of any person as director in place
of a nominee who is unable to serve or who for good cause will not serve; and
matters incident to the conduct of the Meeting. Voting rights will be exercised
by the Trustee as directed, provided instructions are received by the Trustee by
April 14, 1995. This proxy may be revoked only by a written revocation or a new
proxy card received by the Trustee on or before April 14, 1995. Under the Plan,
the Advisory Committee, consisting of the Personnel/Affirmative Action Committee
of the board of TCF Financial Corporation, has authority to direct the Trustee
as to voting of shares as to which no instructions are received by April 14,
1995.
PLEASE MARK, SIGN AND DATE ON REVERSE SIDE AND RETURN THIS VOTING INSTRUCTION
CARD PROMPTLY USING THE ENCLOSED ENVELOPE. BY LAW, YOUR VOTE IS CONFIDENTIAL.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE /SEE REVERSE SIDE/
<PAGE>
/x/ Please mark
votes as in
this example.
The shares represented by this voting instruction card will be voted on a
confidential basis as directed by the participant. If no signed proxy card is
received by April 14, 1995, however, the shares will be voted as directed by the
Advisory Committee of the Plan. This proxy may be revoked only by a written
revocation or a new proxy card received by the Trustee on or before April 14,
1995.
Unless otherwise indicated, all signed proxy cards received will be voted "FOR"
all nominees for election as directors and "FOR" all proposals referred to
herein. The Board of Directors recommends that you vote "FOR" all proposals.
1. Election of Directors
NOMINEES: Joseph P. Clifford, Robert E. Evans,
Luella G. Goldberg, Ralph Strangis, Mark K. Rosenfeld.
FOR / / WITHHELD / /
/ /
- - ------------------------------------------------------
For all nominees except as written on the line above.
FOR AGAINST ABSTAIN
2. Appointment of KPMG Peat / / / / / /
Marwick LLP as independent
public accountants for 1995.
3. Approve increase in the / / / / / /
maximum permissible size of
the Board of Directors from
15 to 25.
4. Approve the TCF Financial / / / / / /
1995 Incentive Stock
Program.
5. Approve the TCF Directors / / / / / /
Deferred Compensation Plan
and Trust.
MARK HERE / /
FOR ADDRESS
CHANGE AND
NOTE AT LEFT
NOTE: Please sign as name appears hereon.
Signature: Date
-------------------------------------------- --------------------
<PAGE>
TCF
APRIL 19, 1995
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PROXY
To: First Trust National Association as Trustee under the Trust Agreement for
the Great Lakes Bancorp Amended Employee Stock Ownership Plan and as Trustee
under the Great Lakes Bancorp Amended 401(k) Savings and Investment Plan and
Trust Agreement.
The Trustee named above is hereby instructed to vote (by proxy, in the form
solicited by the Board of Directors, or in person) all the shares or fractional
shares of Common Stock of TCF Financial Corporation which are credited to the
undersigned's account(s) as of the latest available processing date on or before
March 1, 1995, at the Annual Meeting of Stockholders of TCF Financial
Corporation to be held on April 19, 1995, and any adjournment thereof, on the
items set forth on the reverse hereof, as described in the accompanying Proxy
Statement and upon such other business as may properly come before the Meeting
including: any matters which the Board of Directors did not know, a reasonable
time before mailing this solicitation, would be presented at the Meeting;
approval of minutes of the prior annual and prior special shareholders meetings;
election of any person as director in place of a nominee who is unable to serve
or who for good cause will not serve; and matters incident to the conduct of the
Meeting. Voting rights will be exercised by the Trustee as directed, provided
instructions are received by the Trustee by April 14, 1995. This proxy may be
revoked only by a written revocation or a new proxy card received by the Trustee
on or before April 14, 1995. Under each Great Lakes Bancorp Plan, the shares
for which no signed proxy card is returned are voted by the Trustee in the same
proportions on each proposal as the shares were voted for which instructions
were received.
PLEASE MARK, SIGN AND DATE ON REVERSE SIDE AND RETURN THIS VOTING INSTRUCTION
CARD PROMPTLY USING THE ENCLOSED ENVELOPE. BY LAW, YOUR VOTE IS CONFIDENTIAL.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE) /SEE REVERSE SIDE/
<PAGE>
/x/ Please mark
votes as in
this example.
The shares represented by this voting instruction card will be voted on a
confidential basis as directed by the participant. If no signed proxy card is
received by April 14, 1995, however, the shares will be voted by the
Trustee in the same proportion as the shares were voted for which instructions
were received. This proxy may be revoked only by a written revocation or a new
proxy card received by the Trustee on or before April 14, 1995.
Unless otherwise indicated, all signed proxy cards received by the Trustee will
be voted "FOR" all nominees for election as directors and "FOR" all proposals
referred to herein. The TCF Board of Directors recommends that you vote "FOR"
all proposals.
1. Election of Directors
NOMINEES: Joseph P. Clifford, Robert E. Evans,
Luella G. Goldberg, Ralph Strangis, Mark K. Rosenfeld.
FOR / / WITHHELD / /
/ /
- - ------------------------------------------------------
For all nominees except as written on the line above.
FOR AGAINST ABSTAIN
2. Appointment of KPMG Peat / / / / / /
Marwick LLP as independent
public accountants for 1995.
3. Approve increase in the / / / / / /
maximum permissible size of
the TCF Board of Directors
from 15 to 25.
4. Approve the TCF Financial / / / / / /
1995 Incentive Stock
Program.
5. Approve the TCF Directors / / / / / /
Deferred Compensation Plan
and Trust.
MARK HERE / /
FOR ADDRESS
CHANGE AND
NOTE AT LEFT
NOTE: Please sign as name appears hereon.
Signature: Date
-------------------------------------------- --------------------
