<PAGE>
As filed with the Securities and Exchange Commission on April 28, 2000.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
Item 10. [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
or
Item 11. [_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to ______________
Commission file number: 0-29668
HIGHLAND BANCORP, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
Delaware 95-4654552
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
</TABLE>
601 South Glenoaks Boulevard
Burbank, California 91502
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (818) 848-4265
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock, par
value $0.01 per share
(Title of Class)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
---
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [_]
The aggregate market value of the Common Stock held by non-affiliates of the
Registrant based upon the closing sale price of the Common Stock on March 24,
2000, as reported on the NASDAQ National Market, was approximately $46,441,771.
Shares of Common Stock held by each executive officer and director and each
person owning more than 5% of the outstanding Common Stock of the Registrant
have been excluded in that such persons may be deemed to be affiliates of the
Registrant. This determination of affiliate status is not necessarily a
conclusive determination for other purposes.
Number of shares outstanding of the Registrant's Common Stock, as of March 24,
2000: 4,243,474.
<PAGE>
INDEX
<TABLE>
<CAPTION>
PART III
<S> <C> <C>
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT.....................3
Directors..................................................................3
Executive Officers and Key Employees.......................................4
Section 16(a) Beneficial Ownership Reporting Compliance....................5
Item 11. EXECUTIVE COMPENSATION.............................................5
Option Grants..............................................................6
Option Exercises and Holdings..............................................6
Executive Officer Change of Control Agreements.............................7
Acceleration Events Under the Option Plan..................................7
Director Compensation......................................................7
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT.....................................................8
ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.....................9
SIGNATURES .......................................................................10
</TABLE>
2
<PAGE>
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT
Directors
The following are the biographies of Highland Bancorp, Inc.'s ("Highland"
or the "Company") current directors. There are no arrangements or
understandings among any of the directors relating to their election as
directors.
<TABLE>
<CAPTION>
Name and Age Principal Occupation and Business Experience
------------ --------------------------------------------
<S> <C>
Woodrow W. DeWitt (84) Director of the Company since 1997. Director of Highland Federal Bank, a Federal
Savings Bank (the "Bank") since 1968. Chairman of the Board of DeWitt Transfer &
Storage since 1955.
Richard O. Oxford (62) Director of the Company since 1997. Director of the Bank since 1991. President
and Chief Executive Officer of Dial Industries, Inc. (a manufacturer of
housewares) since 1978. Associate, McKinsey & Co. (international management
consulting firm) from 1965 to 1968. In 1993, Arroyo Seco Enterprises, a
partnership of which Mr. Oxford was General Partner, filed for bankruptcy under
Chapter 11 of the Bankruptcy Code. This bankruptcy was discharged in 1995.
Shirley E. Simmons (65) Director of the Company since 1997. Vice Chairman of the Board of Directors of
the Bank since 1995 and a Director of the Bank since 1991. Retired since 1991.
Various executive positions with Security Pacific National Bank from 1958 to 1991,
most recently as Regional Vice President (1988 to 1991).
Richard J. Cross (70) Chairman of the Board of Directors of the Company since 1997. Chairman of the
Board of Directors of the Bank since 1993. Vice Chairman of the Board of
Directors of the Bank from 1992 to 1993 and a Director of the Bank since 1990.
Managing Partner of Cross Investment Company (an investment and consulting
company) since 1971 and Professor of Management and Finance at Woodbury University
since 1985. Twenty-seven years' commercial banking experience, including various
executive positions with Lloyds Bank from 1962 to 1981, most recently as Executive
Vice President.
William G. Dyess (74) Director of the Company since 1997. Director of the Bank since 1968. An
independent real estate appraiser since 1955.
George Piercy (81) Director of the Company since 1997. Vice Chairman of the Board of Directors of
the Bank from 1993 to 1995 and a Director of the Bank since 1968. Chairman of the
Board of Directors of the Bank from 1982 to 1993. President of Highland Auto and
Truck Supply (manufacturer of military truck parts and accessories) since 1949.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
Stephen N. Rippe (53) Director of the Company since 1997. President and Chief Executive Officer of the
Company since 1997. Chief Executive Officer of the Bank since December 1999.
President of the Bank from April 1994 to December 1999, and Executive Vice
President from February to April 1994. Director of the Bank since February 1994.
Chief Operating Officer of Imperial Thrift and Loan Association from 1991 to 1994.
Various executive positions with Security Pacific National Bank from 1971 to 1989,
including President of Security Pacific Bank Nevada from 1987 to 1989 and Regional
Manager for business banking from 1984 to 1987.
</TABLE>
Executive Officers and Key Employees
These are the biographies of the Company's current executive officers,
except for Mr. Rippe, the Chairman, whose biography is included above under
"Directors." There are no arrangements or understandings among these
individuals relating to their election as officers.
<TABLE>
<CAPTION>
Name and Age Principal Occupation and Business Experience
------------- --------------------------------------------
<S> <C>
Ellen B. Geiger (47) Chief Operating Officer of the Bank since December 1999. Executive Vice
President and Branch Administrator of the Bank since January 1997. Senior Vice
President and Branch Administrator of the Bank from July 1995 to January 1997.
Founder and President of Geiger/Kochakji & Associates (banking industry
consultants) from 1991 to 1995. Various executive positions with Security
Pacific National Bank from 1979 to 1991, most recently as Senior Vice President
and Branch Administrator.
Garry P. Warren (49) President of the Bank since December 1999. Executive Vice President and Chief
Lending Officer of the Bank since January 1997. Senior Vice President and Chief
Lending Officer of the Bank from May 1994 to January 1997. Southern California
Regional Manager of Imperial Thrift and Loan Association from 1993 to 1994. Vice
President of Pacific First Mortgage from 1990 to 1992. Senior Director of Grubb
and Ellis, Mortgage Banking Division, from 1987 to 1990. Senior Vice President
of American Savings from 1983 to 1987. Vice President and Manager for Citicorp
from 1981 to 1983.
Kelly A. Andrews (52) Senior Vice President, Treasurer (Principal Financial Officer) and Secretary of
the Company since July of 1999. Treasurer of the Bank since 1987. Chief
Financial Officer of the Bank from 1985 to 1996.
Stephen D. Cooper (49) Senior Vice President, Controller (Principal Accounting Officer) and Secretary of
the Bank since December 1999. Secretary of the Bank since July 1999. Vice
President and Controller of the Bank since May 1998. Assistant Controller at
People's Bank of California from February through May 1998. Executive recruiter
in 1997. Various financial positions, ending as Vice President and Treasurer,
for Imperial Thrift and Loan Association, from April 1990 through January 1997.
Mr. Cooper is a Certified Public Accountant.
</TABLE>
None of the directors or officers are related to each other by blood or
marriage and none of the directors or officers are involved in any legal
proceedings as described in Section 401(f) of Regulation S-K.
4
<PAGE>
Section 16(a) Beneficial Ownership Reporting Compliance.
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
Highland's directors, executive officers, and greater-than-10% stockholders to
file reports with the SEC and The Nasdaq Stock Market reflecting changes in
their beneficial ownership of Highland stock and to provide Highland with copies
of the reports. Based on the review of these reports and of certifications
furnished to Highland, we believe that all of these reporting persons complied
with their filing requirements for 1999, except that Messrs. Cross, DeWitt,
Dyess, Oxford, Piercy and Ms. Simmons each filed a Form 4 for February 1999 on
March 15, 1999, which should have been filed on March 10, 1999.
Item 11. EXECUTIVE COMPENSATION
Set forth below is certain information concerning the compensation of (i)
Stephen N. Rippe, Chief Executive Officer of the Company and the Bank, (ii)
Garry P. Warren, President and Chief Lending Officer of the Bank, (iii) Ellen B.
Geiger, Chief Operating Officer, Executive Vice President and Branch
Administrator of the Bank and (iv) Anthony Frey, former Chief Financial Officer
of the Company (collectively, the "named executive officers"), for each of the
last three fiscal years or such lesser period that such individual has been
employed by the Bank. No other executive officer of the Bank received salary
and bonus at a rate in excess of $100,000 during 1999. Executive officers of
the Company currently receive no compensation in their capacities as executive
officers of the Company but are compensated as employees of the Bank.
<TABLE>
<CAPTION>
Name and
Principal
Position Annual Compensation Long-Term Compensation
- ------------------------------------------------------------------------------------------------------------------------------
Other
Annual Performance
Compen- Stock Options All Other
Year Salary Bonus sation (1) Awards(2) (#)(3) Compensation
----------- ------------- ------------ -------------------------------------------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Stephen N. Rippe 1999 $267,616 $111,338 $-- $-- 20,000 $13,622 (4)
Chief 1998 235,050 89,730 -- -- -- 13,345 (4)
Executive 1997 215,185 66,500 -- 106,250 90,000 12,632 (4)
Officer of the
Company and
the Bank
Garry P. Warren 1999 177,192 66,298 20,102 -- 16,000 10,615 (5)
President and 1998 152,988 90,683 -- -- -- 10,826 (5)
Chief Lending 1997 146,243 39,750 -- 90,313 34,000 11,109 (5)
Officer of the
Bank
Ellen B. Geiger 1999 141,816 50,678 49,612 -- 12,000 11,430 (6)
Chief 1998 118,925 40,069 -- -- -- 8,753 (6)
Operating 1997 113,839 31,500 -- 63,750 22,000 10,774 (6)
Officer of the
Bank
Anthony Frey 1999 78,905 61,353 141,959 -- -- 5,240 (7)
Chief Financial 1998 142,680 48,155 -- -- -- 12,080 (7)
Officer (8) 1997 137,531 26,000 -- 58,437 26,000 7,726 (7)
</TABLE>
(1) Amounts reported in 1999 consist of a tax-off set cash bonus in connection
with a program to exchange incentive stock options for non-qualified stock
options.
5
<PAGE>
(2) Pursuant to the Option Plan, Messrs. Rippe, Warren and Frey and Ms. Geiger
were granted 10,000, 8,500, 5,500 and 6,000 shares, respectively, in fiscal
1997, which had a market value at December 31, 1999 of $190,000, $161,500,
$104,500 and $114,000, respectively. The dollar amounts set forth in the
table represent the market value of the shares on the date of issuance.
(3) Consists of the number of shares of stock underlying stock options granted
during the periods indicated, adjusted for two-for-one stock split effected
in May 1999.
(4) Consists of $5,000, $5,000, and $4,750 contributions to the Bank's 401(k)
Plan, $1,028, $1,268, and $1,318 in imputed life insurance payments and
$4,385, $3,868, and $3,355 for personal use of a Bank automobile and
$3,209, $3,209, and $3,209 in lieu of disability insurance coverage in
1999, 1998, and 1997, respectively.
(5) Consists of $5,000, $5,000, and $4,750 contributions to the Bank's 401(k)
Plan, $515, $953, and $1,146 in imputed life insurance payments and $2,578,
$2,351, and $2,691 for personal use of a Bank automobile and $2,522,
$2,522, and $2,522 in lieu of disability insurance coverage in 1999, 1998,
and 1997, respectively.
(6) Consists of $5,000, $3,098 and $4,596 contributions to the Bank's 401(k)
Plan, $445, $930, and $796 in imputed life insurance payments and $2,522,
$1,262, and $1,919 for personal use of a Bank automobile and $3,463,
$3,463, and $3,463 in lieu of disability insurance coverage 1999, 1998, and
1997, respectively.
(7) Consists of $5,000, $5,000 and $1,911 contributions to the Bank's 401(k)
Plan, $240, $717 and $768 in imputed life insurance payments and $-0-,
$6,363 and $5,047 for personal use of a Bank automobile in 1999, 1998 and
1997, respectively.
(8) Served as Chief Financial Officer until June 25, 1999.
Option Grants
The following table sets forth certain information concerning stock options
granted to the named executive officers during the fiscal year ended December
31, 1999.
<TABLE>
<CAPTION>
Potential Realizable Value
at Assumed Annual Rate of
Stock Price Appreciation
Individual Grant for Option Term (1)
---------------------------------------------------------------------------- ----------------------------------
Number Percent of
Shares of Total Options
Stock Granted to
Underlying Employees in Exercise Expiration
Name Options Fiscal Year Price Date 5% 10%
- --------------- -------------------- --------------------- -------------- --------------- ------------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Stephen N. Rippe 20,000 27.8% $17.81 02/24/09 $580,300 $923,900
Garry P. Warren 16,000 22.2% 17.81 02/24/09 464,300 739,200
Ellen B. Geiger 12,000 16.7% 17.81 02/24/09 348,200 554,400
Anthony Frey -0- -0- N/A N/A -0- -0-
</TABLE>
(1) The amounts shown are hypothetical gains based on the indicated assumed
rates of appreciation of the Common Stock, compounded annually over a ten-
year period and assuming that the closing price was the market value of the
grant. The actual value (if any) than an executive officer receives from a
stock option will depend upon the amount by which the market price of the
Company's Common Stock exceeds the exercise price of the option on the date
of exercise. The Company does not assume that the Common Stock will
appreciate at any particular rate or at all in future years.
(2) The options granted are exercisable 33.3% per year beginning on each of the
first 3 anniversary dates of grant.
Option Exercises and Holdings
The following table provides information with respect to the named
executives concerning their exercise of options during 1999 and their year-end
option holdings.
6
<PAGE>
<TABLE>
<CAPTION>
Value of Unexercised
Number of Unexercised In-the-Money Options
Options at Year End at Year End (1)
Name Shares
Acquired on Value Exercise/ Exercise/
Exercise Realized Unexercisable Unexercisable
----------------- ----------------- ----------------------- ----------------------------
<S> <C> <C> <C> <C>
Stephen N. Rippe 20,000 $195,000 102,500/47,500 $ 957,500/$ 266,250
Garry P. Warren 7,100 67,006 11,730/27,500 105,551/122,625
Ellen B. Geiger 12,000 165,375 37,500/20,500 373,500/92,750
Anthony Frey 52,000 545,289 0/0 0/0
</TABLE>
_______________________
(1) Value of an exercise "in-the money" options is the difference between the
fair market value of the securities underlying the options and the exercise
price of the options as of December 31, 1999. The closing sale price of the
Common Stock on December 31, 1999 was $19.00 per share.
Executive Officer Change of Control Agreements
In 1995, the Bank entered into a Change of Control Employment Agreement
with each of Messrs. Rippe and Warren, Ms. Geiger, and three other officers of
the Bank, and in 1998, the Bank entered into a Change of Control Agreement with
another officer of the Bank. Such agreements provide that if a change of
control of the Bank (defined to include a merger, consolidation or asset
transfer where the Bank is not the surviving entity and the acquisition by a
person or group of more than 50% of the outstanding shares of the Bank) occurs
during the employment of the individual and the individual's position is
subsequently eliminated or materially altered or the individual resigns his or
her employment for good reason (defined to include a reduction in salary levels
or benefits, material diminution in title or responsibilities or a job
relocation of more than 50 miles), the individual will be entitled to a lump sum
payment equal to his or her salary for a specified period. In the case of Mr.
Rippe, such period is two and one-half years and in the case of Mr. Warren and
Ms. Geiger, such period is one and one-half years.
Acceleration Events Under the Option Plan
In the event the Company enters into an agreement to dispose of all or
substantially all of its assets or if the Company's stockholders dispose or
agree to become obligated to dispose of fifty percent or more of the outstanding
shares of Common Stock ("Acceleration Event"), then each outstanding option will
be exercisable during the thirty days immediately preceding such Acceleration
Event. However, no Acceleration Event will be deemed to occur in the event that
(i) the terms of the agreements pursuant to which such transaction is occurring
requires as a condition to the consummation of the transaction that each option
will be either assumed by a successor corporation or be replaced with a
comparable option to purchase shares of stock of the successor corporation, and
(ii) the transaction is approved by a majority of the directors who have been in
office for more than twelve months prior to the scheduled consummation of the
transaction. Upon consummation of the Acceleration Event, all outstanding
options, whether or not so accelerated, will terminate and cease to be
exercisable, unless assumed by the successor corporation.
Director Compensation
During 1999, each director of the Bank, other than directors who were also
employees of the Bank, was paid directors fees of $2,000 per month and $175 for
each committee meeting attended. Mr. Cross (Chairman of the Board) received
additional fees of $417 per month as compensation for that
7
<PAGE>
position. Ms. Simmons (Chairman of the Audit Committee) received additional fees
of $208 per month as compensation for that position. Pursuant to this
arrangement, the Bank paid $172,175 in aggregate compensation to directors
during 1999. Each director of the Bank who has reached the age of 72 and has
served as a director for at least 18 years or was a director for at least 18
years or was a director on August 19, 1985, or who becomes unable to continue to
serve as a director for reasons of ill health, may be designated a "director
emeritus" by the Board of Directors. Each director emeritus would be entitled to
continue to receive a monthly fee equal to the board fee he or she received
immediately prior to becoming a director emeritus and the continuation of
certain benefits. The Board of Directors has designated Ben Karmelich who
retired as a director of the Bank in April 1998, a "director emeritus". Mr.
Karmelich does not presently receive a monthly fee. Directors of the Bank are
not currently paid any additional fees for serving as directors of the Company.
Each non-employee director is also eligible to participate in the stock option
plan. During 1999, each of the non-employee directors was granted non-qualified
options to acquire 8,000 shares of Common Stock at an exercise price of $17.81
per share.
Prior to July 1992, each of Messrs. DeWitt, Dyess and Piercy has retirement
agreements with the Bank that provided for certain retirement benefits in the
event of the retirement or death of such director, payable in annual
installments over 15 years. Such benefits would have been not less than $6,400
annually in the event of retirement or death occurring after June 19, 1992 and
not more than $9,600 annually in the event of retirement or death occurring
after June 19, 1996. Effective July 1992, each Messrs. DeWitt, Dyess and Piercy
elected to receive, commencing in 1992 and in lieu of such retirement benefits,
15 annual payments of $6,400. Pursuant to this arrangement, the Bank paid
$19,200 in aggregate compensation during 1999.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows, as of March 24, 2000, all persons or entities we
know to be "beneficial owners" of more than five percent of our Common Stock.
This information is based on Schedules 13D and 13G reports filed with the SEC by
each of the persons and entities listed in the table below. If you wish, you
may obtain these reports from the SEC.
<TABLE>
<CAPTION>
Common Stock Beneficially Owned at
Name and Address of Beneficial Owner March 24, 2000
- --------------------------------------------------- -------------------------------------------------------------
Number of Shares Percent of Class
-------------------------------------------------------------
<S> <C> <C>
Wellington Management Company, LLP (1) 378,400 8.9%
75 State Street
Boston, Massachusetts 02109
John Hancock Mutual Life Insurance Company (2) 331,334 7.8%
101 Huntington Avenue
Boston, Massachusetts 02199
Sandler O'Neill Asset Management LLC (3) 235,000 5.5%
712 Fifth Avenue - 22nd Floor
New York, New York 10019
</TABLE>
_____________________
(1) Based on a Schedule 13G filed by Wellington Management Company, LLP on
February 9, 2000.
(2) Based on a Schedule 13G filed by John Hancock Mutual Life Insurance Company
on January 19, 2000. Direct beneficial ownership of the shares is held by
John Hancock Advisors, Inc., which is a wholly-owned subsidiary of The
Berkley
8
<PAGE>
Financial Group, which is a wholly-owned subsidiary of John Hancock
Subsidiaries, Inc., which is a wholly-owned subsidiary of John Hancock
Mutual Life Insurance Company.
(3) Based on Schedule 13D filed by Sandler O'Neill Asset Management LLC on
February 25, 1999. The shares of Common Stock are held by various
partnerships of which SOMA Holdings, LLC ("Holdings") is the general
partner and to which Sandler O'Neill Asset Management provides
administrative and management services. The managing member and President
of Holdings and Sandler O'Neill Asset Management is Terry Maltese.
The following table sets forth the beneficial ownership of the Common Stock
as of March 24, 2000 by each director and executive officer and by all directors
and executive officers of the Company as a group. Except as noted all such
shares are beneficially owned solely by such individual or jointly with such
individual's spouse.
<TABLE>
<CAPTION>
Name of Beneficial Owner Amount Beneficially Owned Percent of Class(1)
- -------------------------------------- ----------------------------------------- ---------------------------
<S> <C> <C>
Richard J. Cross 41,000(2)(3) 1.0%
Woodrow W. DeWitt 105,104(2) 2.5%
William G. Dyess 44,264(2)(4) 1.0%
Ellen B. Geiger 47,000(5) 1.1%
Richard O. Oxford 42,714(2) 1.0%
George Piercy 105,104(2) 2.5%
Stephen N. Rippe 173,002(6) 4.1%
Shirley E. Simmons 28,030(2) *
Garry P. Warren 30,611(7) *
Kelly Andrews 42,650(8) 1.0%
Stephen Cooper 2,000(9) *
All directors and executive
officers as a group (9 persons) 661,479(10) 15.6%
</TABLE>
* Less than 1%.
(1) Shares which the person (or group) has the right to acquire within 60 days
after the Record Date are deemed to be outstanding in calculating the
percentage ownership of the person (or group) but are not deemed to be
outstanding as to any other person (or group).
(2) Includes 21,000 shares, which may be acquired within 60 days upon exercise
of outstanding options.
(3) Does not include 6,000 shares owned by Mr. Cross's wife, as to which Mr.
Cross disclaims beneficial ownership.
(4) Does not include 3,200 shares owned by Mr. Dyess's wife as to which Mr.
Dyess disclaims beneficial ownership.
(5) Includes 47,000 shares, which may be acquired within 60 days upon exercise
of outstanding options.
(6) Includes 131,668 shares, which may be acquired within 60 days upon exercise
of outstanding options.
(7) Includes 25,564 shares, which may be acquired within 60 days upon exercise
of outstanding options.
(8) Includes 2,000 shares, which may be acquired within 60 days upon exercise
of outstanding options.
(9) Includes 2,000 shares, which may be acquired within 60 days upon exercise
of outstanding options.
(10) Includes a total of 334,232 shares, which may be acquired within 60 days
upon exercise of outstanding options.
ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
NONE.
9
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized this 28th
day of April, 2000.
HIGHLAND BANCORP, INC.
By: /s/ Stephen N. Rippe
---------------------------------
Stephen N. Rippe
President
10
