SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
[ X ] Filed by the registrant
[ ] 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 ss. 240.14a-11(c) or ss. 240.14a-12
FIRST DEFIANCE FINANCIAL CORP.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
<PAGE>
FIRST DEFIANCE FINANCIAL CORP.
601 Clinton Street
Defiance, Ohio 43512
(419) 782-5015
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 22, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders ("Annual
Meeting") of First Defiance Financial Corp., Defiance, Ohio ("First Defiance")
will be held at the home office of its subsidiary First Federal Savings and
Loan, located at 601 Clinton Street, Defiance, Ohio 43512, Tuesday, April 22,
1997 at 1:00 p.m., Eastern Time, for the following purposes, all of which are
more completely set forth in the accompanying Proxy Statement:
(1) To elect three (3) directors for three-year terms, and
until their successors are elected and qualified;
(2) To ratify the appointment by the Board of Directors of
Ernst & Young LLP as First Defiance's independent auditors for the year
ending December 31, 1997; and
(3) To transact such other business as may properly come
before the Annual Meeting or any adjournment thereof. Management is not
aware of any other business.
The Board of Directors has fixed March 17, 1997 as the voting record
date for the determination of shareholders entitled to notice of and to vote at
the Annual Meeting or at any adjournment thereof. Only those shareholders of
record as of the close of business on that date will be entitled to vote at the
Annual Meeting or at any such adjournment.
BY ORDER OF THE BOARD OF DIRECTORS
/s/Erwin L. Clemens
--------------------
Erwin L. Clemens
Secretary
Defiance, Ohio
March 24, 1997
- --------------------------------------------------------------------------------
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. IT IS IMPORTANT THAT
YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN IF YOU PLAN TO
BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING, YOU MAY VOTE
EITHER IN PERSON OR BY PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN WRITING
OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
- --------------------------------------------------------------------------------
<PAGE>
PROXY STATEMENT
First Defiance Financial Corp.
601 Clinton Street
Defiance, Ohio 43512
1997 ANNUAL MEETING OF SHAREHOLDERS
April 22, 1997
General
This Proxy Statement is being furnished to holders of common stock,
$0.01 par value per share ("Common Stock"), of First Defiance Financial Corp.,
Defiance, Ohio ("First Defiance"). Proxies are being solicited on behalf of the
Board of Directors of First Defiance to be used at the Annual Meeting of
Shareholders ("Annual Meeting") to be held at the home office of First Federal
Savings and Loan ("First Federal") located at 601 Clinton Street, Defiance, Ohio
43512, on Tuesday April 22, 1997 at 1:00 p.m., Eastern Time, and at any
adjournment thereof for the purposes set forth in the Notice of Annual Meeting
of Shareholders. This Proxy Statement is first being mailed to shareholders on
or about March 24, 1997.
Proxies
The proxy solicited hereby, if properly signed and returned to First
Defiance and not revoked prior to its use, will be voted in accordance with the
instructions contained therein. If no contrary instructions are given, each
proxy received will be voted for the nominees for director described herein and
for the other matter described below and, upon the transaction of such other
business as may properly come before the meeting, in accordance with the best
judgment of the persons appointed as proxies. Any shareholder giving a proxy has
the power to revoke it at any time before it is exercised by (i) filing with the
Secretary of First Defiance written notice thereof (Erwin L. Clemens, Secretary,
First Defiance Financial Corp., 601 Clinton Street, Defiance, Ohio 43512); (ii)
submitting a duly-executed proxy bearing a later date; or (iii) appearing at the
Annual Meeting and giving notice of revocation to the Secretary. Proxies
solicited hereby may be exercised only at the Annual Meeting and any adjournment
thereof and will not be used for any other meeting.
Voting Rights
Only shareholders of record at the close of business on March 17, 1997
("Voting Record Date") will be entitled to notice of and to vote at the Annual
Meeting. On the Voting Record Date, there were 9,423,896 shares of Common Stock
issued and outstanding and First Defiance had no other class of equity
securities outstanding. Each share of Common Stock is entitled to one vote at
the Annual Meeting on all matters properly presented at the meeting.
<PAGE>
The presence, either in person or by proxy, of at least a majority of
the outstanding shares of Common Stock entitled to vote is necessary to
constitute a quorum at the Annual Meeting. Directors are elected by a plurality
of the votes cast with a quorum present. Abstentions are considered in
determining the presence of a quorum and will not affect the plurality vote
required for the election of directors. A majority of the total votes cast is
required to ratify the appointment of the independent auditors. Under rules of
the New York Stock Exchange, the proposals for election of directors and
ratification of the auditors are considered "discretionary" items upon which
brokerage firms may vote in their discretion on behalf of their clients if such
clients have not furnished voting instructions and for which there will not be
"broker non-votes."
Beneficial Ownership
The following table includes, as of the Voting Record Date, certain
information as to the Common Stock beneficially owned by (i) the only person or
entities, including any "group" as that term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended ("1934 Act"), who or which was known
to First Defiance to be the beneficial owner of more than 5% of the issued and
outstanding Common Stock, (ii) each director and each person nominated to become
a director of First Defiance, (iii) the executive officers of First Defiance
named in the Summary Compensation Table set forth under "Executive
Compensation," and (iv) all directors and executive officers of First Federal as
a group.
<TABLE>
<CAPTION>
Amount and Nature of
Name of Beneficial Owner or Beneficial Ownership as of Percent of
Number of Persons in Group March 17, 1997 (1) Common Stock
--------------------------- ---------------------------- ------------
<S> <C> <C>
First Federal Savings and Loan
Employee Stock Ownership Plan 850,332 (2) 9.02%
John Hancock Mutual Life
Insurance Company 734,085 (3) 7.79%
Wellington Management Company, LLP 659,500 (4) 7.00%
Franklin Resources, Inc. 554,000 (5) 5.88%
Don C. Van Brackel 188,539 (6) 1.98%
Edwin S. Charles 128,926 (7) 1.36%
Erwin L. Clemens 85,613 (8) (9)
James M. Zachrich 85,617 (8) (9)
Dr. John U. Fauster III 45,859 (8)(10) (9)
Dr. Marvin J. Ludwig 49,411 (8)(11) (9)
Stephen L. Boomer 26,996 (12) (9)
Thomas A. Voigt 5,352 (13) (9)
Dr. Douglas A. Burgei 7,062 (13) (9)
Gerald W. Monnin 215 (9)
Marvin K. Rabe 160,242 (14) 1.69%
William J. Small 39,646 (15) (9)
John W. Boesling 89,069 (16) (9)
John C. Wahl 36,572 (17) (9)
All directors and executive
officers as a group (14 persons) 968,378 (18) 9.84%
(Footnotes on next page)
<PAGE>
(1) For purposes of this table, pursuant to rules promulgated under the
1934 Act, an individual is considered to beneficially own shares of
Common Stock if he or she directly or indirectly has or shares (1)
voting power, or (2) investment power, which includes the power to
dispose or direct the disposition of the shares. Unless otherwise
indicated, a director has sole voting power and sole investment power
with respect to the indicated shares. Shares which are subject to stock
options which have been granted under the 1993 Stock Option Plan (the
"the 1993 Directors' Plan"), the 1993 Stock Incentive Plan (the "1993
Incentive Plan") or the 1996 Stock Option Plan (the "1996 Stock Option
Plan") which are exercisable within 60 days of the Voting Record Date
and shares which will be received upon the vesting of awards under the
1996 Management Recognition Plan and Trust ("1996 MRP") within 60 days
of the Voting Record Date are deemed to be outstanding for the purpose
of computing the percentages of Common Stock beneficially owned by the
respective individuals and group. The 1993 Directors' Plan, the 1993
Incentive Plan and the 1996 Stock Option Plan are collectively referred
to as the "Option Plans".
(2) Shares owned by First Federal Savings and Loan Employee Stock Ownership
Plan ("ESOP") which have been allocated to persons listed in this
beneficial ownership table are also included in those persons holdings.
(3) The shares beneficially owned by John Hancock Mutual Life Insurance
Company are owned by its wholly owned subsidiary, John Hancock
Advisors, Inc.
(4) The shares beneficially owned by Wellington Management Company LLP, in
its capacity as investment advisor, are owned of record by clients of
Wellington Management Company LLP. Those clients have the right to
receive, or the power to direct the receipt of, dividends from, or the
proceeds from the sale of, such shares of First Defiance stock. No such
client is known to have such right or power with respect to more than
five percent of First Defiance common stock.
(5) The shares are considered beneficially owned by Franklin Resources,
Inc. and its two principal shareholders, Charles B. Johnson and Rupert
H. Johnson, Jr.. The shares reported by Franklin Resources, Inc. are
owned by Franklin Advisory Services, Inc., and Franklin Mutual
Advisors, Inc., advisory subsidiaries of Franklin Resources, Inc.
Advisory contracts grant to such subsidiaries all voting and investment
power over the securities owned by such advisory clients and the
subsidiaries may by deemed to be the beneficial owners of the
securities.
<PAGE>
(6) Includes 68,332 shares owned by trusts for the benefit of Mr. Van
Brackel and his wife, 6,218 shares held in the 1993 Management
Recognition Plan ("1993 MRP") which may be voted by Mr. Van Brackel
pending distribution, 9,327 shares which vest within 60 days under the
1996 MRP, 16,576 shares which have been allocated to Mr. Van Brackel's
account in the ESOP and 88,087 shares which may be acquired upon the
exercise of stock options, including 23,317 options which vest within
60 days under the 1996 Stock Option Plan. Should Mr. Van Brackel
terminate his employment with First Defiance before April 19, 1997, he
will forfeit his shares in the 1996 MRP and the 1996 Stock Option Plan.
(7) Includes 6,261 shares owned by his wife, 22,999 shares held by a trust
for the benefit of his children, 1,243 shares which vest within 60 days
under the 1996 MRP and 57,084 shares which may be acquired upon the
exercise of stock options, including 3,109 options which vest within 60
days under the 1996 Stock Option Plan. Mr. Charles shares voting power
with certain of his children with respect to the 22,999 shares cited
above. Should Mr. Charles terminate his board service with First
Defiance before April 19, 1997, he will forfeit his shares in the 1996
MRP and the 1996 Stock Option Plan.
(8) Includes 2,073 shares held in the 1993 MRP which may be voted by the
director pending distribution, 1,243 shares which vest within 60 days
under the 1996 MRP and 24,699 shares which may be acquired upon the
exercise of stock options, including 3,109 options which vest within 60
days under the 1996 Stock Option Plan. Should the director terminate
his board service with First Defiance before April 19, 1997, he will
forfeit his shares in the 1996 MRP and the 1996 Stock Option Plan.
(9) Less than 1% of the total outstanding shares of Common Stock.
(10) Includes 777 shares owned by his wife.
(11) Includes 1,431 shares owned by his wife.
(12) Includes 1,243 shares which vest within 60 days under the 1996 MRP plan
and 24,699 shares which may be acquired under the exercise of stock
options, including 3,109 options which vest within 60 days under the
1996 Stock Option Plan. Should Mr. Boomer terminate his board service
with First Defiance before April 19, 1997, he will forfeit his shares
in the 1996 MRP and the 1996 Stock Option Plan.
(13) Includes 1,243 shares which vest within 60 days under the 1996 MRP plan
and 3,109 shares which may be acquired under the exercise of stock
options which vest within 60 days under the 1996 Stock Option Plan.
Should the director terminate his board service with First Defiance
before April 19, 1997, he will forfeit his shares in the 1996 MRP and
the 1996 Stock Option Plan.
<PAGE>
(14) Includes 19,001 shares owned by his wife, 6,218 shares held in the 1993
MRP which may be voted by Mr. Rabe pending distribution, 5,700 shares
which vest within 60 days under the 1996 MRP, 16,576 shares which have
been allocated to Mr. Rabe's account in the ESOP and 53,760 shares
which may be acquired upon the exercise of stock options, including
14,900 options which vest within 60 days under the 1996 Stock Option
Plan. Should Mr. Rabe terminate his employment with First Defiance
before April 19, 1997, he will forfeit his shares in the 1996 MRP and
the 1996 Stock Option Plan.
(15) Includes 100 shares owned jointly with his son, 200 shares held as
custodian for minor children, 2,760 shares which vest within 60 days
under the 1996 MRP, 3,030 shares which have been allocated to Mr.
Small's account in the ESOP and 28,900 shares which may be acquired
upon the exercise of stock options, including 6,900 options which vest
within 60 days under the 1996 Stock Option Plan. Should Mr. Small
terminate his employment with First Defiance before April 19, 1997, he
will forfeit his shares in the 1996 MRP and the 1996 Stock Option Plan.
(16) Includes 1,617 shares held as custodian for a minor child, 2,073 shares
held in the MRP which may be voted by Mr. Boesling pending
distribution, 5,700 shares which vest within 60 days under the 1996
MRP, 10,314 shares which have been allocated to Mr. Boesling's account
in the ESOP and 32,808 shares which may be acquired upon the exercise
of stock options, including 6,900 options which vest within 60 days
under the 1996 Stock Option Plan. Should Mr. Boesling terminate his
employment with First Defiance before April 19, 1997, he will forfeit
his shares in the 1996 MRP and the 1996 Stock Option Plan.
(17) Includes 300 shares held as custodian for minor children, 2,400 shares
which vest within 60 days under the 1996 MRP, 5,872 shares which have
been allocated to Mr. Wahl's account in the ESOP and 26,000 shares
which may be acquired upon the exercise of stock options, including
6,000 options which vest within 60 days under the 1996 Stock Option
Plan. Should Mr. Wahl terminate his employment with First Defiance
before April 19, 1997, he will forfeit his shares in the 1996 MRP and
the 1996 Stock Option Plan.
(18) Includes options to purchase 419,309 shares, including 83,687 options
which vest within 60 days under the 1996 Stock Option Plan. Also
includes 23,837 shares of Common Stock held in the 1993 MRP which may
be voted by the officer or director pending distribution. Also includes
33,692 shares which vest within 60 days under the 1996 MRP. Also
includes 59,551 shares of Common Stock allocated to the accounts of
executive officers in the ESOP.
</TABLE>
<PAGE>
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR, DIRECTORS
WHOSE TERMS CONTINUE AND EXECUTIVE OFFICERS
Election of Directors
First Defiance's Board of Directors is currently composed of nine
members. The Code of Regulations of First Defiance provide that the Board of
Directors of First Defiance shall be divided into three classes which are as
equal in number as possible, and that the members of each class are to be
elected for a term of three years and until their successors are elected and
qualified. One class of directors is elected annually.
At the Annual Meeting, shareholders of First Defiance will be asked to
elect three directors for three year terms, and in each case until their
successors are elected and qualified. No nominee for director is related to any
other director or executive officer of First Defiance by blood, marriage or
adoption. Mr. Van Brackel and Dr. Burgei currently serve as directors of First
Defiance. Mr. Monnin has been nominated to fill the vacancy created by the
retirement of Erwin L. Clemens effective with the Annual Meeting.
Unless otherwise directed, each proxy executed and returned by a
shareholder will be voted for the election of the nominees for director listed
below. If any person named as nominee should be unwilling to stand for election
at the time of the Annual Meeting, the proxies will vote for any replacement
nominee or nominees recommended by the Board of Directors. At this time, the
Board of Directors knows of no reason why any of the nominees listed below may
not be able to serve as a director if elected.
Information with Respect to Nominees for Director and Continuing Directors
The following tables present information concerning each nominee for
director and each director whose term continues, including his tenure as a
director of First Federal.
<TABLE>
<CAPTION>
NOMINEES FOR DIRECTOR FOR THREE-YEAR TERM EXPIRING IN 2000
Positions Held in Director
Name Age First Defiance Since(1)
---- --- -------------- --------
<S> <C> <C> <C>
Don C. Van Brackel 58 Chairman, President and
Chief Executive Officer 1979
Dr. Douglas A. Burgei 42 Director 1995
Gerald W. Monnin 58 N/A N/A
</TABLE>
(Footnotes on next page)
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT THE
NOMINEES BE ELECTED AS DIRECTORS
<TABLE>
<CAPTION>
DIRECTORS WITH TERMS EXPIRING IN 1998
Positions Held in Director
Name Age First Defiance Since(1)
---- --- -------------- --------
<S> <C> <C> <C>
Edwin S. Charles 84 Vice Chairman 1959
James M. Zachrich 75 Director 1975
Stephen L. Boomer 46 Director 1994
<CAPTION>
DIRECTORS WITH TERMS EXPIRING IN 1999
Positions Held in Director
Name Age First Defiance Since(1)
---- --- -------------- --------
<S> <C> <C> <C>
Dr. John U. Fauster, III 59 Director 1975
Dr. Marvin J. Ludwig 70 Director 1979
Thomas A. Voigt 54 Director 1995
- ---------------
(1) Includes service as a director of First Defiance and its predecessors.
</TABLE>
Each of the Directors of First Defiance is also a director of First
Federal Savings and Loan ("First Federal"), a wholly owned subsidiary of First
Defiance. The business experience of each of the nominees or directors for at
least the past five years is as follows:
Don C. Van Brackel. Mr. Van Brackel became Chairman of the Board of
Directors and Chief Executive Officer of First Federal, First Defiance's
predecessor, on January 1, 1995. He was president and managing officer of First
Federal from July, 1992 until June 1996 and has been a director of First
Defiance and its predecessors since 1979. He previously was president and chief
executive officer of A. Van Brackel & Sons, Inc., Defiance, Ohio, a company that
sells and services coin-operated equipment, sound systems and
satellite-delivered background music as a 3-M franchisee. As Chairman and CEO,
Mr. Van Brackel is also Chairman of the Executive and Loan Review Committees of
First Federal and a member of the Investment Committee.
<PAGE>
Edwin S. Charles. Mr. Charles served as the Chairman of the Board of
Directors and Chief Executive Officer of First Federal from 1988 until his
retirement on December 31, 1994. He also served as president of First Federal
from 1972 until 1988. Mr. Charles retired as managing officer of First Federal
in 1978. He retains the title of Vice Chairman of the Board of Directors and
serves as a consultant to management and the Board. He has been director of
First Defiance and its predecessors since 1959 and currently serves as Chairman
of the Governance Committee and as a member of the Investment and MRP - Stock
Options Committees and on the Executive and Loan Review Committees on a rotating
basis during the year.
John U. Fauster III D.D.S. Dr. Fauster is affiliated with the Defiance
Dental Group and engages in the general practice of dentistry in Defiance, Ohio.
He has been a director of First Defiance and its predecessors since 1975 and
currently serves as a member of its Audit, Compensation and Long Range Planning
Committees and serves on the Executive and Loan Review Committees on a rotating
basis during the year.
Marvin J. Ludwig. Dr. Ludwig was president of The Defiance College, an
independent, co-educational, liberal arts college affiliated with the United
Church of Christ, from 1975 until his retirement on June 30, 1994. He has served
as a director of First Defiance and its predecessors since 1979 and currently
serves as Chairman of the Audit and Compensation Committees and as a member of
the MRP - Stock Options Committee and serves on the Executive and Loan Review
Committees on a rotating basis during the year.
James M. Zachrich. Mr. Zachrich retired on June 1, 1992 as chief executive
officer of Defiance Metal Products, a manufacturing company specializing in the
stamping and fabrication of metal products, where he had served in that capacity
for 22 years. He has been a director of First Defiance and its predecessors
since 1975 and currently serves as a member of its Audit, Compensation, and Long
Range Planning Committees and serves on the Executive and Loan Review Committees
on a rotating basis during the year.
Stephen L. Boomer. Mr. Boomer is President and co-owner of Arps Dairy
Inc., Defiance, Ohio, a processor and distributor of various dairy products. He
has been a director since August 1, 1994 and currently serves as Chairman of the
MRP - Stock Options Committee and as a member of the Audit and Governance
Committees and serves on the Executive and Loan Review Committees on a rotating
basis during the year.
Douglas A. Burgei, D.V.M. Dr. Burgei is a veterinarian practicing in
Napoleon, Ohio since 1978. He was appointed to the Board of Directors in August,
1995 and he serves on the Investment, Long-Range Planning and Governance
Committees and serves on the Executive and Loan Review Committees on a rotating
basis.
Thomas A. Voigt. Mr. Voigt is a vice president and general manager of the
Bryan Publishing Company, publisher of one daily and eight weekly newspapers,
including The Bryan Times, The Countyline, The Montpelier Leader Enterprise and
Realty Northwest. He was appointed to the board in August, 1995 and he serves as
Chairman of the Long-Range Planning Committee and on the Compensation and MRP -
Stock Options Committees and serves on the Executive and Loan Review Committees
on a rotating basis during the year.
<PAGE>
Gerald W. Monnin. Mr. Monnin has been nominated for a three year term
on the board of directors expiring in 2000. Since 1978 he has been President and
Chief Executive Officer of Northwest Controls, a Defiance, Ohio company that
distributes high technology electronic automation and control products and
systems.
Executive Officers Who Are Not Directors
The following sets forth certain information with respect to the executive
officers of First Federal who are not directors, including their business
experience for at least the past five years.
Marvin K. Rabe. Age 62. Mr. Rabe joined First Federal in 1968 and
currently serves as Senior Vice President and Treasurer. He served as Chief
Financial Officer until January, 1997. He also is Chairman of the Company's
Investment Committee.
William J. Small. Age 46. Mr. Small was appointed President and Chief
Operating Officer of First Federal in June 1996, after having served as Senior
Vice President responsible for lending from July 1, 1994. He remains a Senior
Vice President of First Defiance. Prior to joining First Defiance he was
president and managing officer of The Hicksville Building, Loan and Savings
Association, Hicksville, Ohio since 1987. Mr. Small serves as a member of the
Loan Review Committee.
John W. Boesling. Age 49. Mr. Boesling joined First Federal in 1971 and
currently serves as Senior Vice President responsible for lending. Mr. Boesling
serves as a member of the Loan Review Committee.
John C. Wahl. Age 36. Mr. Wahl was appointed Senior Vice President and
Chief Financial Officer in January, 1997 after having served as Controller since
June 1, 1994. Prior to joining First Defiance he was a senior manager with Ernst
& Young LLP, the Company's independent auditors.
Patricia A. Cooper. Age 51. Mrs. Cooper was appointed Senior Vice
President responsible for retail operations in January, 1997. She has served
First Federal in a variety of capacities since she joined the Company in 1964,
most recently as Vice President of operations.
Compliance with Section 16(a) of the 1934 Act
Section 16(a) of the 1934 Act requires First Defiance's officers and
directors, and persons who own more than 10% of the Common Stock to file reports
of ownership and changes in ownership with the Securities and Exchange
Commission (the "SEC"). Officers, directors and greater than 10% shareholders
are required by regulation to furnish First Defiance with copies of all Section
16(a) forms they file.
Based solely on review of the copies of such forms furnished to First
Defiance, First Defiance believes that during 1996, all Section 16(a) filing
requirements applicable to its officers and directors were complied with.
<PAGE>
The Board of Directors and Its Committees
Regular meetings of the Board of Directors of First Defiance are held
monthly. Because First Defiance's business is primarily conducted through First
Federal, regular meetings of the Board of Directors of First Federal are held on
at least a monthly basis and special meetings of the Board of Directors of First
Federal are held from time-to-time as needed. There were 12 meetings of the
Board of Directors of First Defiance and 14 meetings of the Board of Directors
of First Federal held during 1996. No director attended fewer than 75% of the
total number of meetings of the Board of Directors of either First Defiance or
First Federal held during 1996 and the total number of meetings held by all
committees of the Board on which the director served during such year.
The Boards of Directors of First Defiance and First Federal have
established various committees, including Executive, Audit, Governance,
Compensation, Long Range Planning and MRP - Stock Options Committees.
The Executive Committee generally has the power and authority to act on
behalf of the Board of Directors on important matters between scheduled Board
meetings unless specific Board of Directors action is required or unless
otherwise restricted by First Federal's charter or bylaws or its Board of
Directors. Mr. Van Brackel serves as Chairman of the Executive Committee The
eight outside directors serve on the Committee on a rotating basis during the
year. The Executive Committee met 52 times during 1996.
The Audit Committee reviews (i) the independent auditors' reports and
results of their examination (ii) the OTS and Federal Deposit Insurance
Corporation and other regulatory reports and (iii) reports issued by First
Federal's internal auditor. The entire Board of Directors subsequently reviews
such reports and examinations. Currently, Drs. Ludwig and Fauster, and Messrs.
Zachrich and Boomer serve as members of this committee. The Audit Committee met
two times during 1996.
The Governance Committee, consisting of Messrs. Charles, Clemens,
Boomer and Dr. Burgei, meets to review certain policies established by the Board
of Directors and to ensure compliance with First Federal and OTS standards.
The Compensation Committee, consisting of Drs. Ludwig and Fauster and
Messrs. Zachrich and Voigt, was established by the Board of Directors to oversee
the compensation programs provided to First Federal's management including base
salaries, bonuses and benefit plans.
The Long Range Planning Committee, consisting of Messrs. Voigt, Clemens
and Zachrich and Drs. Fauster and Burgei, is responsible for reviewing strategic
decisions which will have a long-term impact on First Federal's operations.
The MRP - Stock Options Committee, consisting of Messrs. Boomer, Clemens,
Charles, and Voigt and Dr. Ludwig, is responsible for reviewing and approving
grants made to management under First Defiance's 1993 MRP, the 1996 Management
Recognition Plan (the "1996 MRP"), and the Option Plans. Such grants are also
subject to approval by the full Board of Directors.
To date, First Defiance has not established a nominating committee, the
functions of which are performed by the full Board of Directors.
<PAGE>
Other Committees
In addition to the Committees of the Board of Directors, First Federal
also has an Investment Committee which currently consists of Messrs. Van
Brackel, Charles, and Burgei as well as Mr. Rabe, Senior Vice President and
Treasurer. This committee has full authority to buy or sell any and all
securities and mortgage-backed bank investments within the parameters of the
Investment Policy Statement established by the Board of Directors.
First Federal also has a Loan Review Committee which currently consists
of Mr. Van Brackel and two directors on a rotating basis in conjunction with the
Executive Committee assignment as well as Mr. Small, President and Chief
Operating Officer of First Federal and Mr. Boesling, Senior Vice President. This
committee reviews and approves loan requests presented by the loan officers and
reviews loans made during the prior months. Actions by the Loan Review Committee
are ratified by the Executive Committee.
EXECUTIVE COMPENSATION
Summary
The following table sets forth a summary of certain information concerning
the compensation awarded to or paid by First Defiance for services rendered in
all capacities during the last three fiscal years to the Chief Executive Officer
and the most highly compensated executive officers of First Defiance and First
Federal whose total compensation during the year ended December 31, 1996
exceeded $100,000. Positions with First Defiance are listed as of December 31,
1996.
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
---------------------------------- ------------------------------------
Awards Payouts
------ -------
Securities All Other
Name and Compensation Stock Underlying LTIP Compensation
Principal Position Year Salary (1) Bonus (2) (3) Grant (4) Options Payouts (5)
- ------------------ ---- ---------- --------- --- --------- ------- ------- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Don C. Van Brackel, 1996 $157,862 $88,912 --- $507,145 116,584 --- $43,782
Chairman, President 1995 144,125 80,475 --- --- --- --- 62,012
and Chief Executive 1994 131,875 73,125 --- --- --- --- 42,750
Officer
Marvin K. Rabe 1996 $131,324 $75,989 --- $309,937 74,500 --- $43,782
Senior Vice 1995 123,750 71,250 --- --- --- --- 62,012
President, Chief 1994 117,500 67,500 --- --- --- --- 42,750
Financial Officer
and Treasurer
William J. Small 1996
Senior Vice 1995 $89,124 $53,474 --- $369,750 107,100 --- $36,480
President, Chief 1994 60,000 36,000 --- --- --- --- ---
Operating Officer 26,000 23,200 --- --- --- --- ---
First Federal
Savings and Loan
John W. Boesling 1996 $73,824 $39,375 --- $150,075 34,500 --- $33,319
Senior Vice 1995 65,625 35,625 --- --- --- --- 42,186
President 1994 59,375 31,875 --- --- --- --- 21,010
John C. Wahl 1996 $68,724 $41,429 --- $130,500 50,000 --- $31,343
Vice President, 1995 60,000 36,000 --- --- --- --- 32,239
Controller 1994 30,667 12,800 --- --- --- --- ---
- -----------------------
(Footnotes on next page)
<PAGE>
(1) Includes amounts deferred by Messrs. Van Brackel and Rabe pursuant to First
Defiance's deferred compensation program.
(2) Bonus amounts reflect amounts earned during the fiscal year as determined
by the Compensation Committee, including amounts which are paid in the
following year.
(3) Does not include amounts attributable to miscellaneous benefits received by
executive officers. In the opinion of management of First Defiance the
costs to First Defiance of providing such benefits to any individual
executive during the year ended December 31, 1996 did not exceed the lesser
of $50,000 or 10% of the total of annual salary and bonus reported for the
individual.
(4) Represents the grant of 46,634, 28,500, 13,800, 13,800 and 12,000 shares of
restricted Common Stock to Messrs. Van Brackel, Rabe, Small, Boesling and
Wahl, respectively, in April, 1996 under the 1996 MRP. Mr. Small received
an additional grant of 20,200 shares in July, 1996 under the 1996 MRP. All
shares granted under this program vest 20% per year over five years on the
anniversary date of the grant. Unvested shares are forfeited upon
termination or retirement. The awards to Messrs. Van Brackel, Rabe, Small,
Boesling, and Wahl had a fair value at December 31, 1996 of $577,096,
$352,687, $420,750, $170,775 and $148,500 respectively at December 31,
1996.
(5) Consists of amounts allocated by First Defiance on behalf of Messrs. Van
Brackel, Rabe, Small, Boesling and Wahl pursuant to First Defiance's
Employee Stock Ownership Plan.
</TABLE>
<PAGE>
Stock Options
The following table provides information relating to option grants made
pursuant to the 1996 Stock Option Plan and the 1993 Stock Incentive Plan to the
individuals named in the Summary Compensation Table.
<TABLE>
<CAPTION>
STOCK OPTION GRANTS IN LAST FISCAL YEAR
Potential realizable
value at assumed rates
of stock price appreciation
Individual Grants for option terms
---------------------------------------------------------- ---------------------------
Number of Percent of
securities total options
underlying granted to
options employees Exercise Expiration
Executive Officer granted in 1996 Price date 5% 10%
- ----------------- ------- ------- ----- ---- -- ---
<S> <C> <C> <C> <C> <C> <C>
Don C. Van Brackel 116,584 (1) 25.4% $10.50 2006 $769,454 $1,950,450
Marvin K. Rabe 74,500 (1) 16.2 10.50 2006 491,700 1,246,385
William J. Small 34,500 (1) 7.5 10.50 2006 227,700 577,185
22,000 (2) 4.8 10.69 2006 147,840 374,880
50,600 (2) 11.0 10.375 2006 330,165 836,671
-------- -------- ----------
107,100 705,705 1,788,736
John W. Boesling 34,500 (1) 7.5 10.50 2006 227,700 577,185
John C. Wahl 30,000 (1) 6.5 10.50 2006 198,000 501,900
20,000 (2) 4.4 10.69 2006 134,400 340,800
-------- --------- ----------
50,000 332,400 842,700
(1) Options were granted under the 1996 Stock Option Plan. Options vest 20% per
year over a five year period on the anniversary date of the grant. Unvested
options under the 1996 Stock Option Plan are generally forfeited upon
termination of employment including retirement.
(2) Options were granted under the 1993 Stock Incentive Plan and are fully
vested.
</TABLE>
<PAGE>
The following table sets forth certain information concerning exercises of
stock options granted pursuant to the Company's 1993 Stock Incentive Plan by the
named executive officers during the year ended December 31, 1996 and options
held at December 31, 1996 under the 1993 Stock Incentive Plan and the 1996 Stock
Option Plan.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
Number of
Shares Securities Underlying
Acquired on Value Unexercised Value of Unexercised
Name Exercise Realized Options at Year End Options at Year End (1)
---- -------- -------- ------------------- -----------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Don C. Van Brackel ........... -- -- 64,770 116,584 $501,644 $218,595
Marvin K. Rabe ............... 6,479 $ 50,990 38,860 74,500 300,971 139,687
William J. Small ............. -- -- 22,000 85,100 37,125 101,200
John W. Boesling ............. -- -- 25,908 34,500 200,657 64,687
John C. Wahl ................. -- -- 20,000 30,000 33,750 56,250
- ----------------------
(1) Based on a per share market price of $12.375 at December 31, 1996 and
exercise prices ranging from $4.63 per share to $10.6875 per share.
</TABLE>
Report of the Compensation Committee
In order to provide compensation levels comparable to its peers and to
provide incentives for achieving improved performance the Compensation Committee
recommended and the Board of Directors adopted on February 15, 1993 an
incentive-based executive salary program which will provide management with a
base salary targeted at approximately 62.5% of total cash compensation with the
remaining 37.5% consisting of an incentive bonus. Under the program, management
would attain targeted levels of compensation only upon realizing prescribed
levels of performance established by the Board. For 1996, $299,180 in bonuses
was allocated to the executive officers named in the Summary Compensation Table
set forth under "Executive Compensation". Comparable amounts for 1995 and 1994
were $259,350 and $208,500 respectively.
<PAGE>
The Committee evaluates the base salaries of the executive officers of
First Defiance and First Federal annually. An executive officer's base salary is
determined based upon longevity with First Defiance, the effectiveness of such
individual in performing his duties, peer averages at the position in question
and First Defiance's overall performance. No particular weight is assigned to
these variables. The base salary component alone, while designed to be
competitive with peer group averages, is not designed to produce top levels of
compensation for the executive officers of First Defiance and First Federal when
compared to its peer group. The incentive component, as described below, which
requires First Defiance to achieve specific goals before additional compensation
is paid, is the element which is designed to make total compensation for each of
the executive officers comparable or better than the comparable executive
compensation for the executive officers in First Defiance's peer group.
For 1996, the Board of Directors determined that First Defiance fully
realized prescribed levels of performance. In making this determination the
Board of Directors considered asset quality, community activities, efficiency of
operations, implementation of strategic objectives, return on average assets,
return on average equity, and overall accomplishments.
The Compensation Committee also retains the right to grant discretionary
bonuses to executives in addition to the amounts included above for service
deemed to be of an extraordinary nature.
During 1996 First Defiance adopted certain stock compensation plans in
connection with the 1995 Conversion and Reorganization and made allocations
under those plans to certain of its executive officers. The bases of the
allocations were the contributions made by the executive officer to First
Defiance and the responsibilities of the executive officer within the First
Defiance organization. The stock awards allocated under the MRP were also
designed to provide an incentive to executive officers to contribute to First
Defiance's future success.
By the Compensation Committee: M.J. Ludwig, Chairman, J.U. Fauster, III,
J.M. Zachrich, T.A. Voigt
<PAGE>
Performance Graph
The following graph compares the yearly cumulative total return on the
Common Stock from the closing price on the date of First Federal's conversion in
1993 to a stock company with (i) the yearly cumulative total return on the
stocks included in the Nasdaq Stock Market Index (for United States companies)
and (ii) the yearly cumulative total return on stocks included in the Nasdaq
Bank Stock Index. All of these cumulative returns are computed assuming the
reinvestment of dividends at the frequency with which dividends were paid during
the applicable years.
First Defiance Financial Corp
(including predecessors)
[GRAPHIC-GRAPH PLOTTED TO POINTS LISTED IN CHART BELOW]
Period Ending
- -------------------------------------------------------------------------------
INDEX 7/10/93 12/31/93 12/31/94 12/31/95 12/31/96
- --------------------------------------------------------------------------------
First Defiance Financial 100.00 101.72 103.19 173.70 218.00
Nasdaq Total Return 100.00 110.82 108.33 153.20 188.45
Nasdaq Bank Index 100.00 104.62 104.24 155.26 205.23
Directors' Compensation
During the year ended December 31, 1996, each member of the Board of
Directors of First Defiance received an annual fee of $14,480 plus an additional
fee of $200 per Board meeting attended. Outside Directors have the option to
defer up to $5,000 of their annual fees pursuant to a deferred compensation
plan. In addition, in 1996 Mr. Clemens served as a permanent member of the
Executive Committee and received $7,800 for the year for service in that
capacity. Rotating members of the Executive Committee received $100 per meeting
held during their term as members. Directors otherwise receive a $2,000 annual
fee for each committee they serve on.
First Defiance also maintains a 1993 Directors' Plan pursuant to which
non-employee directors of First Defiance were granted options to purchase an
aggregate of 107,950 shares of Common Stock at exercise prices ranging from
$4.63 to $6.95 per share depending on the date the options were granted. Also,
Mr. Charles retains 53,975 stock options which were granted to him under the
1993 Incentive Plan when he served as Chief Executive Officer of the Company
with an exercise price of $4.63. Mr. Charles has until December 31, 1999 to
exercise those options.
The non-employee directors also received grants under the 1996 Stock Option
Plan to purchase an aggregate of 124,352 shares of Common Stock at an exercise
price of $10.50 per share. Those options vest 20% per year on the anniversary
date of the grant and unvested options are generally forfeited upon termination
or retirement from the Board of Directors.
<PAGE>
Employment Agreements
First Federal has entered into employment agreements with Messrs. Van
Brackel, Rabe, Boesling and Small (the "Executives"). The form of employment
agreement for each Executive is substantially the same and provides each officer
with a three-year term of employment commencing on the date of the agreement. On
the first anniversary of each agreement and each anniversary thereafter, the
Board of Directors of First Federal shall consider and review extension of the
terms of each agreement and shall continue to extend under such terms unless
either party gives notice of non-renewal to the other party.
The employment agreements are terminable with or without cause by First
Federal. The Executives have no right to compensation or other benefits pursuant
to the employment agreement for any period after voluntary termination or
termination by First Federal for cause, disability, retirement or death.
However, in the event that (i) an Executive terminates his employment because of
failure of First Federal to comply with any material provision of the employment
agreement or (ii) the employment agreement was terminated by an Executive for
Good Reason, as defined, an Executive would be entitled to 2.99 times the
average annual compensation paid to him by First Federal during the five most
recent taxable years ending during the calendar year in which the notice of
termination occurs or such portion of such period in which the Executive served
as senior officer of First Federal as well as continued participation in
employee benefit plans of First Federal (other than retirement plans and stock
compensation plans) until the expiration of the remaining term of employment.
"Good Reason" would generally be defined in the employment agreements to include
the assignment by First Federal to the Executive of any duties which, in the
Executive's good faith determination, are materially inconsistent with the
Executive's positions, duties, responsibilities and status with First Federal
prior to such assignment or prior to a change in control of First Federal.
The employment agreements provide that in the event that any of the
payments to be made thereunder or otherwise upon termination of employment are
deemed to constitute "excess parachute payments" within the meaning of Section
280G of the Internal Revenue Code of 1986, then such payments and benefits
received thereunder would be reduced, in the manner determined by First
Defiance, by the amount, if any, which is the minimum necessary to result in no
portion of the payments and benefits being nondeductible by First Defiance for
federal income tax purposes. Excess parachute payments generally would be
defined as payments in excess of three times the recipient's average annual
compensation from First Defiance includable in the recipients gross income
during the most recent five taxable years ending before the date on which a
change in control of First Defiance or other triggering events occurred ("base
amount"). A recipient of excess parachute payments is subject to a 20% excise
tax on the amount by which such payments exceed the base amount, in addition to
regular income taxes, and payments in excess of the base amount would not be
deductible by First Defiance as compensation expense for federal income tax
purposes.
It is anticipated that similar agreements will be entered into with Mr.
Wahl and Mrs. Cooper.
<PAGE>
Pension Plan
First Defiance maintains a defined benefit pension plan (the "Pension
Plan") covering all employees that have attained 21 years of age and have
completed one full year of service (consisting of 1,000 hours worked during the
year). In general, the Pension Plan provides for benefits payable monthly at
normal retirement age, which is age 65, or the tenth anniversary of joining the
Pension Plan. The monthly payments equal an amount based on a participant's
average monthly compensation over the five consecutive years which produce the
highest monthly average within the last ten completed years of employment. The
monthly benefit equals 2% of a participant's average monthly compensation
multiplied by his or her total number of years of service up to a maximum of 30
years. A participant's interest vests 100% after five years of service, but no
interest vests prior to that time. The compensation covered by the Pension Plan
is equal to the employee's salary and bonus, which for executives is included in
the Summary Compensation Table as their salary and bonus.
The following table illustrates the approximate annual benefit payable
under the Pension Plan to a participant who retires during 1997 at age 65,
assuming various levels of compensation and years of service.
<TABLE>
<CAPTION>
Amount of Annual Retirement Benefit
with Credited Service of: (1)
--------------------------------------------------------------------------------
Average
Annual Salary 15 Years 20 Years 25 Years 30 Years
------------- --------- -------- --------- ------------
<S> <C> <C> <C> <C>
$ 30,000 $ 9,000 $ 12,000 $ 10,000 $ 18,000
40,000 12,000 16,000 20,000 24,000
60,000 18,000 24,000 30,000 36,000
80,000 24,000 32,000 40,000 48,000
100,000 30,000 40,000 50,000 60,000
120,000 36,000 48,000 60,000 72,000
140,000 42,000 56,000 70,000 84,000
160,000 48,000 64,000 80,000 96,000
180,000 54,000 72,000 90,000 108,000
200,000 60,000 80,000 100,000 120,000
220,000 66,000 88,000 110,000 120,000(2)
240,000 72,000 96,000 120,000 120,000(2)
260,000 78,000 104,000 120,000(2) 120,000(2)
- ---------------------------
(1) Benefit amounts shown are on a "ten year certain and life" basis (i.e.,
payments during the life of the employee with a minimum of 120 payments
guaranteed) without reduction for Social Security benefits.
(2) The maximum benefit payable under a defined benefit plan is currently
$120,000.
</TABLE>
As of December 31, 1996, Messrs. Van Brackel, Rabe, Small, Boesling and
Wahl had four years, 28 years, two years, 25 years and two years respectively,
of credited service under the Pension Plan.
<PAGE>
Indebtedness of Management
First Defiance has had no loans outstanding since January 1, 1996 in excess
of $60,000 to any director, nominee for election as a director or executive
officer of First Defiance, any member of the immediate family of any such person
or to certain corporations, organizations or trusts affiliated with any such
person, except loans made in the ordinary course of business on substantially
the same terms, including interest rates and collateral as those prevailing at
the time for comparable transactions with other persons and did not involve more
than the normal risk of collectibility or present other unfavorable features.
Since 1989, federal regulations have prohibited a savings and loan
association from making loans to directors and executive officers on terms more
favorable than those available to other parties. A recent change in federal
regulations permits loans to be made to directors and executive officers on
favorable terms, subject to certain limitations, pursuant to a program widely
available to employees and that does not discriminate in favor of directors,
executive officers or principal shareholders. First Defiance has not extended a
loan to any director or executive officer on favorable terms since the
regulation was changed.
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors of First Defiance has appointed Ernst & Young LLP as
independent auditors for First Defiance for the year ending December 31, 1997,
and further directed that the selection of auditors be submitted for
ratification by the shareholders at the Annual Meeting. First Defiance has been
advised by Ernst & Young LLP that neither the firm nor any of its associates has
any relationship with First Defiance other than the usual relationship that
exists between independent public accountants and clients. Ernst & Young LLP
will have representatives at the Annual Meeting who will have an opportunity to
make a statement, if they so desire, and will be available to respond to
appropriate questions.
The Board of Directors recommends that you vote FOR the ratification of the
appointment of Ernst & Young LLP as independent auditors for the year ending
December 31, 1997.
OTHER MATTERS
Each proxy solicited hereby also confers discretionary authority on the
Board of Directors of First Defiance to vote the proxy with respect to the
election of any person as a director if the nominee is unable to serve or for
good cause will not serve, matters incident to the conduct of the meeting, and
upon such other matters as may properly come before the Annual Meeting.
Management is not aware of any business to come before the Annual Meeting other
than those matters described in this Proxy Statement. However, if any other
matters should properly come before the Annual Meeting, it is intended that the
proxies solicited hereby will be voted with respect to those other matters in
accordance with the judgment of the persons voting the proxies.
The cost of solicitation of proxies will be borne by First Defiance. First
Defiance will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of the Common Stock. In addition to solicitations by
mail, directors, officers and employees of First Defiance may solicit proxies
personally or by telephone without additional compensation.
<PAGE>
SHAREHOLDER PROPOSALS
Any proposal which a shareholder wishes to have included in the proxy
solicitation materials to be used in connection with the next Annual Meeting of
Shareholders of First Defiance must be received at the main office of First
Defiance no later than November 20, 1997. If such proposal is in compliance with
all of the requirements of Rule 14a-8 under the 1934 Act, it will be included in
the Proxy Statement and set forth on the form of proxy issued for the next
Annual Meeting of Shareholders. It is urged that any such proposals be sent by
certified mail, return receipt requested.
ANNUAL REPORTS AND FINANCIAL STATEMENTS
Shareholders of First Defiance as of the Voting Date for the Annual Meeting
are being forwarded a copy of First Defiance's Annual Report to Shareholders for
the year ended December 31, 1996 ("Annual Report"). Included in the Annual
Report are the consolidated financial statements of First Defiance as of
December 31, 1996 and 1995 and for each of the years in the three-year period
ended December 31, 1996, prepared in accordance with generally accepted
accounting principles, and the related report of First Defiance's independent
public accountants. The Annual Report is not a part of this Proxy Statement.
Upon receipt of a written request, First Defiance will furnish to any
shareholder without charge a copy of its Annual Report on Form 10-K filed with
the SEC under the 1934 Act for the year ended December 31, 1996. Upon written
request, First Defiance will furnish to any such shareholder a copy of the
exhibits to the Annual Report on Form 10-K. Such written requests should be
directed to First Defiance Financial Corp., 601 Clinton Street, Defiance, Ohio
43512, Attention: John C. Wahl, Sr. Vice President and Chief Financial Officer.
The Annual Report on Form 10-K is not a part of this Proxy Statement.
BY ORDER OF THE BOARD OF DIRECTORS
/s/Erwin L. Clemens
-------------------
Erwin L. Clemens, Secretary
March 24, 1997
Defiance, Ohio
<PAGE>
REVOCABLE PROXY
FIRST DEFIANCE FINANCIAL CORP.
[X] PLEASE MARK VOTES AS IN THIS EXAMPLE
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
FIRST DEFIANCE FINANCIAL CORP. FOR USE AT THE
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON
APRIL 22, 1997 AND AT ANY ADJOURNMENT THEREOF.
The undersigned hereby appoints the Board of Directors of First
Defiance Financial Corp. (the "Company") as proxies, each with power to appoint
his substitute, and hereby authorized them to represent and vote, as designated
below, all the shares of Common Stock of the Company held of record by the
undersigned on March 17, 1997 at the Annual Meeting of Shareholders to be held
at the home office of its subsidiary, First Federal Savings and Loan, located at
601 Clinton Street, Defiance, Ohio 43512, on Tuesday, April 22, 1997, at 1:00
p.m., Eastern Time, and any adjournment thereof.
1. ELECTION OF DIRECTORS FOR THREE-YEAR TERM EXPIRING IN 2000
Nominees for a three-year term expiring in 2000:
Don C. Van Brackel, Dr. Douglas A. Burgei, Gerald W. Monnin
[ ] FOR [ ] WITHHOLD [ ] FOR ALL EXCEPT
INSTRUCTION: To withhold authority to vote for any individual nominee, mark "For
All Except" and write that nominee's name in the space provided below.
- --------------------------------------------------------------------------------
2. PROPOSAL TO RATIFY THE APPOINTMENT by the Board of Directors of Ernst & Young
LLP as the Company's independent auditors for the year ending December 31,
1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS. THE SHARES OF THE
COMPANY'S COMMON STOCK WILL BE VOTED AS SPECIFIED. IF NOT OTHERWISE SPECIFIED,
THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE BOARD OF DIRECTORS' NOMINEES TO
THE BOARD OF DIRECTORS SPECIFIED IN ITEM 2 AND OTHERWISE AT THE DISCRETION OF
THE PROXIES. YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO THE TIME IT IS VOTED
AT THE ANNUAL MEETING.
Please be sure to sign and date this Proxy in the box below.
- --------------------------------------------------------------------------------
Date
- --------------------------------------------------------------------------------
Shareholder sign above
- --------------------------------------------------------------------------------
Co-holder (if any) sign above
<PAGE>
Detach above card, sign, date and mail in postage paid envelope provided.
FIRST DEFIANCE FINANCIAL CORP.
Please sign this exactly as your name(s) appear(s) on this proxy card.
When signing in a representative capacity, please give title. When shares are
held jointly, only one holder need sign.
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
