Revised Preliminary Proxy Solicitation Material — Sch. 14A Filing Table of Contents
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‘PRER14A’ — Revised Preliminary Proxy Solicitation Material
o
Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
o Definitive Proxy Statement
o Definitive Additional Materials
o
Soliciting Material Pursuant to §240.14a-12
DearbornBancorp, Inc.
(Name
of Registrant as Specified In Its Charter)
(Name
of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
þ No fee required.
o
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:
o Fee paid previously with preliminary materials.
o 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:
SEC 1913 (02-02)
Persons who are to respond to the collection of information
contained in this form are not required to respond unless the form displays a currently valid
OMB control number.
NOTICE IS HEREBY GIVEN that a Special Meeting of
Shareholders of Dearborn Bancorp, Inc. will be held on Tuesday,
December 9, 2008, at 4:00 P.M., local time, at its
Fidelity Bank Operations Center located at 4000 Allen Road,
Allen Park, Michigan48101, for the following purpose:
1. To act on a proposed Amendment to the Articles of
Incorporation to authorize the issuance of up to
5,000,000 shares of preferred stock; and
2. To transact such other business as may properly come
before the meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on
November 10, 2008 as the record date for the meeting and
only shareholders of record at that time will be entitled to
notice of and to vote at the meeting or any adjournments
thereof. Shareholders who are unable to attend the meeting in
person, as well as shareholders who plan to attend the meeting,
are encouraged to vote the proxy by the internet or
telephone, as instructed on the proxy card, if that option
is available, or date, sign and promptly mail the
enclosed proxy. If you are present at the meeting and desire to
vote in person, you may revoke your proxy.
By Order of the Board of Directors,
Jeffrey L. Karafa
Secretary
It is important that you vote your shares as soon as
possible, regardless of the number of shares you own or whether
or not you plan to attend the Special Meeting.
This Proxy Statement is furnished in connection with the
solicitation of proxies from the holders of the Common Stock of
Dearborn Bancorp, Inc. (also referred to as the
“Corporation”) to be used at a Special Meeting of
Shareholders to be held on Tuesday, December 9, 2008, at
4:00 P.M. local time, at its Fidelity Bank Operations
Center located at 4000 Allen Road, Allen Park, Michigan48101,
and at any adjournments thereof. The principal executive offices
of the Corporation are located at 1360 Porter Street, Dearborn,
Michigan48124-2823.
The approximate date on which this Proxy Statement and the
enclosed form of proxy are being mailed to shareholders is
November 21, 2008.
DEARBORN
BANCORP REQUESTS YOUR “FOR” VOTE
The Board of Directors of Dearborn Bancorp has requested this
Special Meeting for the following purpose:
1. To act on a proposed Amendment to the Articles of
Incorporation to authorize the issuance of up to
5,000,000 shares of preferred stock; and
2. To transact such other business as may properly come
before the meeting or any adjournments thereof.
HOW TO
VOTE OR REVOKE YOUR PROXY
Any proxy given pursuant to this solicitation may be revoked by
notice in writing to the Secretary of the Corporation prior to
voting. Unless the proxy is revoked, the shares represented
thereby will be voted at the Special Meeting or any adjournments
thereof. The giving of the proxy does not affect the right to
vote in person should the shareholder attend the meeting. If
your shares are held in an account at a brokerage firm, a bank,
or other nominee, then that party is considered the shareholder
of record for voting purposes and should give you instructions
for voting your shares. As a beneficial owner, you have the
right to direct that organization on how to vote the shares held
in your account.
SHAREHOLDERS
ELIGIBLE TO VOTE
The Board of Directors in accordance with the By-Laws has fixed
the close of business on November 10, 2008 as the record
date for determining the shareholders entitled to notice of and
to vote at the Special Meeting of Shareholders or any
adjournments thereof. At the close of business on such date, the
outstanding number of voting securities of the Corporation was
8,096,204 shares of Common Stock (including
54,369 shares of restricted stock), each of which is
entitled to one vote. Abstentions and broker non-votes are each
included in the determination of the number of shares present
for determining a quorum but not counted on any matters brought
before the meeting. The Proposal to Amend the Articles of
Incorporation to Authorize Preferred Stock will be adopted by a
majority of the votes properly cast at the meeting in favor of
the proposal.
PURPOSE
OF SPECIAL MEETING
U.S.
Treasury’s Capital Purchase Program
The United States Department of the Treasury recently announced
its Capital Purchase Program (CPP) under the Emergency Economic
Stabilization Act of 2008. The CPP was created in response to
the recent instability and
2
uncertainty in the financial markets and is intended to infuse
capital into qualifying U.S. financial institutions and
financial holding companies. The capital eligible for purchase
by the Treasury under the CPP is cumulative perpetual preferred
stock of eligible bank holding companies like Dearborn Bancorp.
The maximum amount of capital eligible for purchase by the
Treasury is the lesser of (i) an amount equal to
3 percent of the Total Risk-Weighted Assets of the
participant or (ii) $25 billion. The minimum amount
eligible for purchase under the CPP is the amount equal to
1 percent of the Total Risk-Weighted Assets of the
participant.
On November 7, 2008, Dearborn Bancorp applied for
participation in the CPP. If the Corporation receives
preliminary approval to participate from the Treasury, it will
have 30 days from the date of notification to submit its
investment agreements and related documentation. The Corporation
applied for approximately $28.8 million of Treasury
capital, which is the maximum amount of capital it is eligible
for based on its Total Risk-Weighted Assets. This investment
would require the issuance to the Treasury of approximately
28,790 shares of preferred stock at a liquidation value of
$1,000 per share.
Shareholder
Authorization of Preferred Stock
Under Dearborn Bancorp’s existing Articles of
Incorporation, it has 20,000,000 authorized shares of Common
Stock but does not have any authorized shares of preferred
stock. The Corporation has called this Special Meeting of
Shareholders for the purpose of authorizing
5,000,000 shares of preferred stock. The authorization of
the preferred stock will allow shares to be issued to the
Treasury in the event that the Corporation is approved to
participate in the CPP and will permit the Board of Directors to
issue preferred stock in the future without further shareholder
approvals, thereby providing the Corporation with maximum
flexibility in structuring acquisitions, joint ventures,
strategic alliances, capital-raising transactions and for other
corporate purposes. Other than issuing shares of the preferred
stock in connection with raising capital through participation
in the CPP, Dearborn Bancorp currently has no current plans,
commitments, or binding agreements with respect to the issuance
of the preferred stock.
The Treasury is under no obligation to approve the applications
of all qualifying financial institutions and financial holding
companies. Therefore, even if the Proposal to Amend the Articles
of Incorporation to Authorize the Issuance of Preferred Stock is
approved at the Special Meeting, there can be no assurance that
Dearborn Bancorp’s application to participate in the CPP
will be approved by the Treasury or, if approved, that it will
be approved for the maximum amount of capital.
If the Proposal is approved and Dearborn Bancorp is able to
raise capital through participation in the CPP, it intends first
to use the proceeds to strengthen its balance sheet and capital
position. Second, the proceeds will be available to support its
loan growth and address its current and future credit issues.
The additional capital would also allow it potentially to
acquire failing or troubled institutions in Southeast Michigan,
whether through FDIC acquisition opportunities or direct
negotiation.
If the Proposal to Amend the Articles of Incorporation to
Authorize the Issuance of Preferred Stock is not approved
Dearborn Bancorp will not be eligible to participate in the CPP
and it could be disadvantaged against its competitors in the
current financial markets and limited in its ability to raise
capital to sustain its future growth. The Corporation currently
does not believe that there will be a material adverse effect on
its liquidity, capital resources or results of operations if the
Treasury denies the application.
If the Shareholders approve this proposal (the
“Articles Amendment”), Dearborn Bancorp will be
authorized to issue up to 5,000,000 shares of preferred
stock (the “Preferred Stock”). The full text of the
proposed Articles Amendment is attached to this Proxy
Statement as Appendix A. If the Articles Amendment is
approved, Dearborn Bancorp’s Board of Directors will be
authorized to issue the Preferred Stock from time to time, in
one or more series, with full or limited or no voting powers,
and with all designations, preferences and special rights,
qualifications, limitations and restrictions upon the Preferred
Stock, as may be provided in the resolutions adopted by its
Board of Directors.
3
Description
of Preferred Stock
The Board of Directors, by resolution, may establish, without
limitation, the following:
•
the designation of each series of Preferred Stock and number of
shares comprising such series;
•
the dividend rate and whether dividends are to be cumulative;
•
whether the shares are to be redeemable, and, if redeemable,
whether for cash, property or rights;
•
the rights to which holders of shares of each series shall be
entitled to preferences, if any, as to dividends and
liquidation, over any other series;
•
whether the shares shall be subject to the operation of a
purchase, retirement or sinking fund, and, if so, upon what
conditions;
•
whether the shares will be convertible into or exchangeable for
shares of any other class or of any other series of any class of
capital stock and the terms and conditions of the conversion or
exchange;
•
the voting powers, full or limited, if any, of the shares;
•
whether the issuance of any additional shares, or of any shares
of any other series, will be subject to restrictions as to
issuance, or as to the powers, preferences or rights of any of
these other series; and
•
any other preferences, privileges and powers and relative,
participating, option or other special rights and
qualifications, limitations or restrictions of such series.
No
Appraisal or Preemptive Rights
Under applicable Michigan law, Dearborn Bancorp’s
shareholders are not entitled to appraisal rights with respect
to the Articles Amendment. Holders of the Corporation’s
Common Stock will not have preemptive rights with respect to any
of the Preferred Stock.
Effect of
Articles Amendment on Holders of Common Stock
The actual effect of the Articles Amendment upon the rights
of holders of Common Stock cannot be stated until Dearborn
Bancorp determines, from time to time, to issue any shares of
Preferred Stock and the Board of Directors determines the
specific rights and preferences of those shares. The effect on
holders of Common Stock of the issuance of Preferred Stock to
the Treasury under the CPP is discussed below.
DEARBORN
BANCORP’S BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED
AND
RECOMMENDS A VOTE “FOR” THE PROPOSED AMENDMENT TO
THE ARTICLES OF
INCORPORATION TO AUTHORIZE THE ISSUANCE OF PREFERRED
STOCK.
MATERIAL
TERMS OF PREFERRED STOCK TO BE ISSUED UNDER CAPITAL
PURCHASE
PROGRAM AND EFFECT OF ISSUANCE ON HOLDERS OF COMMON
STOCK
The Treasury will require certain rights and preferences for the
shares of Dearborn Bancorp’s Preferred Stock to qualify to
be purchased under the CPP (the “CPP Shares”). If and
when the Corporation is accepted to participate in the CPP, the
rights and preferences of the CPP Shares will be established by
the Board of Directors by resolution and the Board will be
required to include the following:
Ranking
With respect to the payment of dividends and the amounts to be
paid upon liquidation, the CPP Shares will rank senior to the
Common Stock and at least equally with all other equity
securities designated as ranking on parity with the CPP Shares
as to payment of dividends or the amounts to be paid upon
liquidation.
4
For so long as any CPP Shares remain outstanding, unless all
accrued and unpaid dividends are fully paid on the CPP Shares,
no dividend may be paid or declared on the Common Stock or other
equity securities designated as ranking junior to or on parity
with the CPP Shares and no Common Stock or other equity
securities designated as ranking junior to or on parity with the
CPP Shares may be redeemed, purchased or otherwise acquired by
the Corporation.
For the first three years that the Treasury owns the CPP Shares,
the Corporation may not increase its dividend payments on the
Common Stock or redeem shares of Common Stock without the
permission of the Treasury.
Dividends
Holders of CPP Shares, in preference to the holders of Common
Stock and other equity securities designated as ranking junior
to the CPP Shares as to payment of dividends, will be entitled
to receive out of assets legally available for payment, cash
dividends payable quarterly at a rate of 5.00% per annum until
the fifth anniversary of the date of issuance, and thereafter at
a rate of 9.00% per annum. Dividends not paid on the CPP Shares
cumulate over the life of the investment.
In the event dividends on the CPP Shares are not paid for six
dividend periods, whether or not consecutive, the Corporation
will be required to expand its board of directors to accommodate
Treasury Department appointments.
Conversion
Rights
The CPP Shares will not be convertible into shares of any other
class or series of Dearborn Bancorp’s stock.
Redemption
CPP Shares may be redeemed by the Corporation during the first
three years following the investment only from the proceeds of a
Qualified Equity Offering by the Corporation. They may be
redeemed thereafter from any source of funds. A Qualified Equity
Offering is a sale by the Corporation, for cash, of Common Stock
or perpetual preferred stock that qualifies as Tier 1
capital under the risk-based capital guidelines of the Federal
Reserve. Any redemption will be at a cash redemption price of
$1,000 per CPP Share, plus any accrued and unpaid dividends.
Holders of the CPP Shares will have no right to require the
redemption of the CPP Shares.
5
Liquidation
Rights
Holders of CPP Shares will be entitled to receive an amount
equal to the fixed liquidation preference of $1,000 per share,
plus any accrued and unpaid dividends, in the event of a
voluntary or involuntary winding up of the Corporation’s
affairs. Holders of the CPP Shares will be entitled to receive
the liquidation preference out of assets of the Corporation that
are available for distribution to shareholders, after payment of
the Corporation’s debts but before any distribution of
assets is made to holders of Common Stock or any other shares
ranking junior to the CPP Shares as to distribution.
Voting
Rights
The holders of CPP Shares will not have any voting rights, other
than class voting rights on matters that could adversely affect
the holders of those shares.
Regulatory
Capital Treatment
The Corporation expects the CPP Shares to qualify as Tier I
capital under the Federal Reserve’s risk-based capital
guidelines applicable to bank holding companies.
Transferability
The Corporation will be obligated to file a registration
statement under the Securities Act of 1933, as amended, as soon
as practicable after issuing the CPP Shares for resale of those
shares. The CPP Shares will not be subject to any contractual
restrictions on transferability and the Treasury may transfer
the CPP Shares to third parties at any time.
ADDITIONAL
TERMS OF PARTICIPATION IN CAPITAL PURCHASE PROGRAM
The full terms and conditions of the CPP are contained in
documentation available from the Treasury Department on its web
site at
http://www.treas.gov/initiatives/eesa/.
In addition to the rights and preferences of the CPP Shares
described above, the Treasury will require compliance with the
following additional terms:
Executive
Compensation
In order to participate in the CPP, Dearborn Bancorp will be
required to agree to certain limits on executive compensation
for its chief executive officer, chief financial officer, and
its next three most highly compensated officers. The Corporation
has to agree, with respect to each such executive: not to deduct
for tax purposes executive compensation in excess of $500,000;
not to make any “golden parachute payment” (as defined
in the Internal Revenue Code); to implement a required clawback
of any incentive compensation paid based on statements of
earnings or other criteria that are later proven to be
materially inaccurate; and to ensure that the incentive
compensation does not encourage unnecessary and excessive risks
that threaten the Corporation’s value. These limitations
will not require any modification of, or otherwise have any
impact on, the Corporation’s current executive compensation
plans or contracts.
Warrants
In addition to the issuance of the CPP Shares under the CPP,
Dearborn Bancorp will be required to issue warrants to the
Treasury to purchase a number of shares of Common Stock having
an aggregate market price equal to 15% of the CPP Shares on the
date of issuance. Assuming the maximum 3% participation,
warrants to purchase approximately 1,458,953 shares of
Common Stock will be issued. Assuming the minimum 1%
participation, warrants to purchase approximately
486,334 shares of Common Stock will be issued.
6
The exercise price of the warrants will be the average market
price for the Common Stock based on the 20 trading days before
the date of issuance of the CPP Shares. The warrants will be
immediately exercisable, subject to certain conditions will be
transferable to third parties, and will expire after
10 years from issuance. The Treasury will agree not to
exercise any voting power with respect to any shares of Common
Stock issued upon exercise of the warrants but transferees may
not be subject to restrictions on voting rights. The number of
shares subject to the warrants will be reduced under certain
circumstances and, to the extent the Corporation redeems the CPP
Shares, it will have a right to repurchase any warrants and
Common Stock issued upon exercise of the warrants held by the
Treasury at fair market value.
Holders of Common Stock have no preemptive rights to purchase
Common Stock upon the issuance or exercise of the warrants. The
issuance of Common Stock upon exercise of the warrants will
therefore have a dilutive effect on the ownership interests of
the existing holders of Common Stock.
FINANCIAL
EFFECT ON DEARBORN BANCORP
OF PARTICIPATION IN CAPITAL PURCHASE PROGRAM
Set forth below is the pro forma effect of the issuance of
Dearborn Bancorp’s Preferred Stock and warrants under the
CPP, at both the 1% minimum and 3% maximum participation levels,
on its key capital ratios and balance sheet items:
Dearborn
Bancorp, Inc.
Current Financial Data
C:
C:
1.00%
3.00%
(Dollars, in thousands, except number of warrants)
9/30/2008
9/30/2008
9/30/2008
Cash and Cash Equivalents
$
63,171
$
63,171
$
63,171
Investments
2,520
12,163
31,448
Loans
939,626
939,626
939,626
Total Assets
1,078,521
1,088,164
1,107,449
Average Assets (QTD)
997,793
997,793
997,793
Risk Weighted Assets before Deductions
968,587
970,515
974,372
Risk Weighted Assets
964,265
966,217
970,123
Deposits
859,269
859,269
859,269
Borrowings
82,505
82,505
82,505
Total Liabilities
944,681
944,681
944,681
Equity
133,840
143,483
162,768
Allowance for Loan Losses
$
16,429
$
16,429
$
16,429
Allowance for Loan Losses disallowed for Tier 2 Capital
4,322
4,298
4,249
Allowance for Loan Losses allowed for Tier 2 Capital
12,107
12,131
12,180
Book Value of New Preferred Stock
$
9,597
$
28,790
Value of Warrants Issued at 15% of New Preferred Stock
1,440
4,319
Number of Warrants(1)
486,334
1,458,953
Tier 1 Capital
$
99,639
$
109,282
$
128,567
Total Capital
$
111,719
$
121,362
$
140,647
Tier 1 Capital to Average Assets
9.99
%
10.95
%
12.89
%
Tier 1 Capital to Risk-Weighted Assets
10.33
%
11.31
%
13.25
%
Total Capital to Risk-Weighted Assets
11.59
%
12.56
%
14.50
%
Liquidity (cash & investments/total assets)
6.09
%
6.92
%
8.54
%
(1)
Based on Closing Common Stock Price of $2.96 on 11/11/08
7
OTHER
MATTERS
The management of Dearborn Bancorp is not aware of any other
matter to be presented for action at the meeting. However, if
any other matter is properly presented for action, it is the
intention of the persons named in the accompanying form of proxy
to vote thereon in accordance with their best judgment.
SECURITY
OWNERSHIP
Management
The following table sets forth, as of November 1, 2008, the
number of shares of the Corporation’s Common Stock
beneficially owned by each director and all directors and
executive officers as a group.
Number
Percent
Name of Individual
of Shares(1)
of Class
Margaret I. Campbell
36,971
(2)
*
John E. Demmer
320,888
(3)(4)
3.96
William J. Demmer
94,340
(4)(5)
1.17
Michael V. Dorian, Jr.
73,500
*
David Himick
341,354
(6)
4.22
Jeffrey L. Karafa
15,476
(7)(8)(9)(10)
*
Donald G. Karcher
62,292
(11)
*
Bradley F. Keller
134,986
(12)
1.67
John A. Lindsey
2,902
(7)
*
Jeffrey G. Longstreth
15,844
*
Warren R. Musson
98,090
(7)(8)(10)(13)
1.21
Michael J. Ross
135,406
(7)(8)(9)(10)
1.67
Robert C. Schwyn
55,196
(14)
*
Stephen C. Tarczy
45,815
(7)(8)(12)(15)
*
Jeffrey J. Wolber
45,702
(7)(8)(10)
*
All Directors and Executive Officers as a Group (15 persons)
1,478,762
(16)
18.26
*
Less than one percent
(1)
Beneficial ownership of shares, as determined in accordance with
applicable Securities and Exchange Commission rules, includes
shares as to which a person has or shares voting power and/or
investment power. Some of the shares listed may be held jointly
with, or for the benefit of, a spouse or children of the person
indicated.
(2)
Includes 3,908 shares owned by Mrs. Campbell’s
husband.
(3)
Includes 154,745 shares held by Mr. Demmer’s wife
as a Trustee of a trust.
(4)
Includes shared voting and ownership of 359 shares held by
Jack Demmer Ford, Inc., of which John E. Demmer is the Chairman
of the Board and CEO and William J. Demmer is the President.
(5)
Includes 11,954 shares owned by Mr. Demmer’s
children.
(6)
Includes 855 shares, for which Mr. Himick has the
power to vote and dispose, held by the Himick Family Investment
Club.
(7)
Includes shares held in the Fidelity Bank 401(k) Trust as
follows: Mr. Karafa — 12,467 shares;
Mr. Lindsey — 2,902 shares;
Mr. Musson — 15,814 shares;
Mr. Ross — 9,250 shares;
Mr. Tarczy — 2,376 shares;
Mr. Wolber — 1,295 shares.
(8)
Includes unvested restricted shares as follows:
Mr. Ross — 1,864 shares;
Messrs. Karafa, Musson, Tarczy and Wolber —
986 shares each.
8
(9)
Excludes shares
in Fidelity Bank 401(k) Trust of which Mr. Karafa and
Mr. Ross are co-trustees.
(10)
Includes shares issuable upon the exercise of stock options
within 60 days of November 1, 2008, by the following
executive officers: Mr. Karafa —
1,483 shares; Mr. Musson —
70,170 shares; Mr. Ross —
108,835 shares; Mr. Tarczy —
36,515 shares; Mr. Wolber —
42,331 shares.
(11)
Includes 15,476 shares held by Mr. Karcher’s wife
as a Trustee of a trust.
(12)
Includes 4,478 shares owned by Mr. Keller’s wife.
(13)
Includes 623 shares held by Mr. Musson’s wife in
a defined contribution plan trust.
(14)
Includes 39,674 shares held for the benefit of
Dr. Schwyn in a defined benefit plan trust.
(15)
Includes 1,555 shares held by Mr. Tarczy’s wife
in a defined contribution plan trust.
(16)
Includes 215,752 shares issuable upon the exercise of stock
options and unvested restricted shares.
Certain
Beneficial Owners
The following table sets forth as of November 1, 2008 the
number of shares of the Corporation’s Common Stock owned by
the only entities or persons known by the Corporation to own
beneficially more than five percent of the Common Stock of the
Corporation.
Represents shares which are held of record by clients of
Wellington Management which has shared power to vote
596,571 shares and shared power to dispose of
820,711 shares. This information is based on a
Schedule 13G/A filed with the Securities and Exchange
Commission on February 14, 2008.
(2)
Represents shares which are held of record by Tontine Financial
Partners, LP (TFP) which has shared power to vote and shared
power to dispose of 588,771 shares; Tontine Management, LLC
tm
which has shared power to vote and shared power to dispose of
588,771 shares; Tontine Overseas Associates, LLC (TOA)
which has shared power to vote and shared power to dispose of
140,436 shares; Jeffrey L. Gendell which has shared power
to vote and shared power to dispose of 729,207 shares. TM,
the general partner of TFP, has the power to direct the affairs
of TFP. TOA serves as investment manager to TFP Overseas Fund,
Ltd (TFPO), with respect to the shares directly owned by TFPO.
Mr. Gendell is general partner of TFP and the managing
member of TM & TOA, and in that capacity directs their
operations. This information is based on a Schedule 13G/A
filed with the Securities and Exchange Commission on
February 8, 2008.
SHAREHOLDER
PROPOSALS
Pursuant to the General Rules under the Securities Exchange Act
of 1934, proposals of shareholders intended to be presented at
the 2009 Annual Meeting of Shareholders of Dearborn Bancorp must
be received by the Secretary of the Corporation at its principal
executive offices located at 1360 Porter Street, Dearborn,
Michigan48124-2823
on or before December 12, 2008. The proposal must comply
with SEC regulations regarding the inclusion of shareholder
proposals in company-sponsored proxy materials. No shareholder
proposal may be presented in any manner at the 2009 Annual
Meeting of Shareholders if notice of such proposal is not
received by the Corporation on or before February 25, 2009.
The following financial information contained in Dearborn
Bancorp’s Annual Report on
Form 10-K
for the fiscal year ended December 31, 2007, as filed with
the SEC on March 17, 2008 and the Quarterly Report on
Form 10-Q
for the quarter ended September 30, 2008, as filed with the
SEC on November 10, 2008 is incorporated
9
herein: financial statements and supplementary financial
information appearing on pages 4 through 49 of Exhibit 13
of the
Form 10-K
and pages 4 through 20 of the
Form 10-Q;
management’s discussion and analysis of financial condition
and results of operations appearing on pages 50 through 68 of
Exhibit 13 to
Form 10-K
and pages 21 through 38 of
Form 10-Q;
and quantitative and qualitative disclosure about market risk
appearing on pages 68 through 70 of Exhibit 13 to
Form 10-K
and pages 39 through 42 of
Form 10-Q.
Dearborn Bancorp will provide free of charge to each record or
beneficial holder a copy of the Corporation’s
Form 10-K
and
Form 10-Q
as filed with the SEC. Requests should be addressed to Dearborn
Bancorp at 1360 Porter Street, Dearborn, Michigan48124-2823.
See also the section below entitled “MISCELLANEOUS”
for information on how to access the Corporation’s website
to obtain the Corporation’s SEC filings.
All documents filed with the SEC by Dearborn Bancorp pursuant to
the reporting requirements of the Securities Exchange Act of
1934 subsequent to the date of this Proxy Statement and prior to
the date of the Special Meeting of Shareholders are incorporated
herein by reference. Any statement contained in a document
incorporated by reference in this Proxy Statement shall be
deemed modified to the extent that a statement contained in
another subsequently filed document which also is incorporated
by reference in this Proxy Statement modifies or supersedes such
statement.
MISCELLANEOUS
Dearborn Bancorp maintains an Internet website at
www.fidbank.com. The Corporation makes available free of
charge through its website various reports that it files with
the Securities and Exchange Commission, including the annual
report on
Form 10-K,
quarterly reports on
Form 10-Q,
current reports on
Form 8-K,
and amendments to these reports. A copy of this Proxy Statement
also is available through its website. From the home page at
www.fidbank.com, go to “Investor Relations” to
access the reports.
The SEC has adopted rules that permit companies and
intermediaries such as brokers to satisfy delivery requirements
for proxy statements and annual reports by delivering a single
set of proxy materials to one address shared by two or more of
our shareholders. This process, which is commonly referred to as
“householding”, potentially provides extra convenience
for shareholders and cost savings for companies. Dearborn
Bancorp only sends one proxy statement to security holders who
share the same address and name unless it has received contrary
instructions. If each security holder desires to have their own
copy, they may notify the Corporation of that fact either orally
or in writing. Notifications can be directed to Dearborn Bancorp
at 1360 Porter Street, Dearborn, Michigan48124-2823.
The cost of soliciting proxies in the accompanying forms will be
paid by Dearborn Bancorp. The Corporation may reimburse brokers
and other persons holding stock in their names or in the names
of nominees for their expenses in sending proxy materials to the
beneficial owners and obtaining their proxies. In addition to
solicitation by mail, proxies may be solicited in person, or by
telephone or electronic communication, by officers and employees
of the Corporation and Fidelity Bank.
The total number of shares of all classes of stock which the
corporation shall have authority to issue shall be
25,000,000 shares which shall be divided into two classes
as follows:
Shares of Common Stock — 20,000,000
Shares of Preferred Stock — 5,000,000
The designations and the powers, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions of the above classes
of stock shall be as follows:
A. COMMON STOCK
a. Except as otherwise required by law or by the Articles
of Incorporation, each holder of Common Stock shall have one
vote for each share of Common Stock held by a holder on all
matters voted upon by the holders of Common Stock.
b. Subject to the preferential dividend rights, if any,
applicable to shares of Preferred Stock and subject to
applicable requirements, if any, with respect to the setting
aside of sums for purchase, retirement or sinking funds for
Preferred Stock, the holders of Common Stock shall be entitled
to receive, to the extent permitted by law, such dividends as
may be declared from time to time by the Board of Directors in
its discretion.
c. In the event of any liquidation, dissolution or winding
up of the Corporation, the holders of Common Stock shall be
entitled, after payment or provision for payment of the debts
and other liabilities of the Corporation and the amounts to
which the holders of any Preferred Stock shall be entitled, to
share ratably in the remaining net assets of the Corporation.
B. PREFERRED STOCK
a. Shares of Preferred Stock may be issued in one or more
series at such time or times and for such consideration or
considerations as the Board of Directors may determine:
b. The Board of Directors is expressly authorized at any
time, and from time to time, to provide for the issuance of
shares of Preferred Stock in one or more series, with such
voting powers, full or limited, but not to exceed one vote per
share, or without voting powers, and with such designations,
preferences and relative, participating, optional or other
special rights, and qualifications, limitations or restrictions
thereof, as shall be stated and expressed in the resolution or
resolutions providing for the issue thereof adopted by the Board
of Directors, and as are not stated and expressed in these
Articles of Incorporation, or any amendment thereto, including
(but without limiting the generality of the foregoing) the
following:
1. The designation of such series and number of shares
comprising such series, which number may (except where otherwise
provided by the Board of Directors in creating such series) be
increased or decreased (but not below the number of shares then
outstanding) from time to time by action of the Board of
Directors.
2. The dividend rate or rates on the shares of such series
and the preference or relation which such dividends shall bear
to the dividends payable on any other class of capital stock or
on any other series of Preferred Stock, the terms and conditions
upon which and the periods in respect of which dividends shall
be payable, whether and upon what conditions such dividends
shall be cumulative and, if cumulative, the date or dates from
which dividends shall accumulate.
3. Whether the shares of such series shall be redeemable,
and, if redeemable, whether redeemable for cash, property or
rights, including securities of any other corporations, at the
option of either the holder or the Corporation or upon the
happening of a specified event, the limitations and restrictions
with respect to such redemption, the time or times when, the
price or prices or rate or rates at which, the adjustments with
which and the manner in which such shares shall be redeemable,
including the manner of selecting shares of such series for
redemption if less than all shares are to be redeemed.
A-1
4. The rights to which the holders of shares of such series
shall be entitled, and the preferences, if any, over any other
series (or of any other series over such series), upon the
voluntary or involuntary liquidation, dissolution, distribution
or winding up of the Corporation, which rights may vary
depending on whether such liquidation, dissolution, distribution
or winding up is voluntary or involuntary, and, if voluntary,
may vary at different dates.
5. Whether the shares of such series shall be subject to
the operation of a purchase, retirement or sinking fund, and, if
so, whether and upon what conditions such purchase, retirement
or sinking fund shall be cumulative or noncumulative, the extent
to which and the manner in which such fund shall be applied to
the purchase or redemption of the shares of such series for
retirement or to other corporate purposes and the terms and
provisions relative to the operation thereof.
6. Whether the shares of such series shall be convertible
into or exchangeable for, at the option of either the holder or
the corporation or upon the happening of a specified event,
shares of any other class or of any other series of any class of
capital stock of the corporation, and, if so convertible or
exchangeable, the times, prices, rates, adjustments, and other
terms and conditions of such conversion or exchange.
7. The voting powers, full
and/or
limited, if any, of the shares of such series, and whether and
under what conditions the shares of such series (alone or
together with the shares of one or more other series) shall be
entitled to vote separately as a single class, for the election
of one or more directors of the corporation in case of dividend
arrearages or other specified events, or upon other matters.
8. Whether the issuance of any additional shares of such
series, or of any shares of any other series, shall be subject
to restrictions as to issuance, or as to the powers, preferences
or rights of any such other series.
9. Any other preferences, privileges and powers and
relative, participating, optional or other special rights, and
qualifications, limitations or restrictions of such series, as
the Board of Directors may deem advisable and as shall not be
inconsistent with the provisions of the Articles of
Incorporation.
c. Unless and except to the extent otherwise required by
law or provided in the resolution or resolutions of the Board of
Directors creating any series of Preferred Stock pursuant to
this Article III(ii)(B), the holders of the Preferred Stock
shall have no voting power with respect to any matter
whatsoever. In no event shall the Preferred Stock be entitled to
more than one vote in respect of each share of stock.
A-2
PROXY
DEARBORN BANCORP, INC.
PROXY — Solicited by Board of Directors
For Special Meeting of Shareholders to be held December 9, 2008
The undersigned hereby appoints John E. Demmer and Michael J. Ross, or either of them, with power
of substitution in each, proxies to vote all Common Stock of the undersigned in Dearborn Bancorp,
Inc. at the Special Meeting of Shareholders to be held on December 9, 2008, and at all adjournments
thereof, upon the following:
To APPROVE an amendment to the Articles of Incorporation to Authorize the Issuance of up to
5,000,000 shares of Preferred Stock.
C:
C:C:
___ FOR
___ AGAINST
___ ABSTAIN
C:
In their discretion, the proxies are authorized to vote upon such other matters as may properly
come before the meeting.
Please indicate whether you plan to attend this meeting in person.
___ YES
___ NO
UNLESS OTHERWISE SPECIFIED, THE PROXIES ARE APPOINTED TO VOTE “FOR” THE AMENDMENT TO THE ARTICLES OF INCORPORATION.
Signature of Shareholder
Signature of Shareholder
Dated___________________________, 2008
Please sign exactly as your name is printed
hereon. When signing as attorney, executor,
administrator, personal representative,
trustee, or guardian, please give full title.
If stock is held jointly, each joint owner
must sign.
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED
Dates Referenced Herein and Documents Incorporated by Reference
