U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB/A
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended: December 31, 1997
Commission File: 0-11090
NAPA NATIONAL BANCORP
(Exact name of small business issuer in its charter)
California 94-2780134
(State of incorporation) (I.R.S. Employer Identification No.)
901 Main Street, Napa, California 94559
(Address of principal executive offices)
Issuer's telephone number: (707) 257-2440
Securities registered pursuant to Section 12(b) of the Act: None.
Securities registered pursuant to Section 12(g) of the Act: Common Stock,
Without Par Value (Title of Class)
Indicate by check mark whether the issuer (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the past 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 .
--- ---
Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]
Revenue earned for the year ended December 31: 1997: $10,815,000
Aggregate market value of voting stock and non-voting stock held by
nonaffiliates of the registrant, based on a market value of $16.00 per share as
of February 28, 1998: $2,822,400
Number of shares of the registrant's sole class of common equity (Common Stock,
Without Par Value), as of April 21, 1998: 783,500.
DOCUMENTS INCORPORATED BY REFERENCE
None.
Transitional small business disclosure format: Yes No X .
--- ----
<PAGE>
Items 9, 10, 11 and 12 of this Form 10-KSB/A replace in their entirety
Items 9, 10, 11 and 12 set forth in the Annual Report on Form 10-KSB of Napa
National Bancorp (the "Company") filed with the United States Securities and
Exchange Commission (the "Commission") on March 30, 1998. The Company is the
sole shareholder of Napa National Bank, a national banking association (the
"Bank").
Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.
Directors
---------
The following table sets forth certain information with respect to those
persons serving as a member of the Company's board of directors (the "Board of
Directors"), each of whom has been nominated by the Board of Directors for
re-election as directors at the Company's 1998 annual meeting of shareholders.
Each such person is currently serving a term of one year. The information
provided below is based on data furnished to the Company by each such person.
<TABLE>
<CAPTION>
Principal Occupation, Business
Director Experience During Past Five
Nominee Age Since Years and Other Information
- ------- --- -------- ------------------------------
<S> <C> <C> <C>
William A. Bacigalupi 60 1990 President of Napa Garbage Services,
Inc., Napa Valley Disposal Services, Inc.
and American Canyon Disposal, Inc.
Dennis D. Groth 55 1996 President of Groth Vineyards & Winery
Michael D. Irwin 55 1987 Chief Financial Officer of the Company since
1989; Executive Vice President and Chief
Financial Officer and Director of The Compass
Group since 1993; Chief Financial Officer and
Director of Wild Planet Toys, Inc. since 1996.
Chief Financial Officer of Swanson Vineyards
and Winery since 1988.
E. James Hedemark 49 1995 Financial consultant since 1994. Formerly,
Director of ITT Federal Bank from 1994 to
1995; President and Chief Executive Officer of
Napa Valley Bank from 1992 to 1993; various
positions at Bank of America from 1972 to
1992.
Brian J. Kelly 47 1988 Director of the Company since 1988; President
and Chief Operating Officer of the Company
since 1992; President and Chief Executive
Officer of the Bank since September 1989.
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C. Richard Lemon 54 1981 Secretary of the Company and the Bank since
1982; Director and Partner of Dickenson,
Peatman & Fogarty since 1979; President of
Exchange Holding Corp. since 1979; President
of Temecula Vineyards, Inc. since 1994;
Partner of Silverado Partners since 1995.
Joseph G. Peatman 64 1994 Founding Partner and Director of Dickenson,
Peatman & Fogarty since 1964.
A. Jean Phillips 53 1995 Owner of Screaming Eagle Vineyard and
Winery since 1986; Partner and owner of
Phillips & Harris Land Brokers since 1979.
George M. Schofield 59 1990 President of George M. Schofield Co., financial
consultant since 1984; President of Unique
Wines, Inc. since 1984; Chief Financial Officer
and Director of Folie A Deux Winery since
1995; Director of Delicato Vine since 1996;
Director of Vintage Directions since 1997.
W. Clarke Swanson, Jr. 59 1987 Chairman of the Board of the Company since
1994; Chief Executive Officer of the Company
since 1988; President of Swanson Vineyards
and Winery since 1986.
</TABLE>
There is no family relationship among any of the Company's executive officers or
directors (all of whom are nominees to be elected as directors).
Executive Officers
------------------
In addition to directors Irwin, Kelly and Swanson, discussed above,
executive officers of the Company and Bank during 1997 included Dale A. Brain
(age 50), Frederick C. Hoey (age 55) and Rodney M. Wiessner (age 36). All
executive officers of the Company and the Bank serve at the pleasure of the
Board of Directors.
Mr. Brain became the Bank's Senior Vice President and Chief Information
Officer in November 1996. Prior to that time, Mr. Brain was Manager, Planning &
Control at Kaiser Permanente Medical from 1992 to 1996. Mr. Brain had previously
been in a variety of management positions with Bank of America from 1969 to
1992.
In March, 1997, the Bank expanded its senior management by hiring
Frederick C. Hoey. Mr. Hoey became the Bank's Senior Vice President and Chief
Credit Officer. Prior to joining the Bank, Mr. Hoey was with American Investors
Company as a regional representative since 1996, with Westamerica Bank as a Vice
President from 1992 to 1996, and in a variety of management positions with
various financial institutions prior to 1992.
In July 1997, the Bank hired Rodney M. Wiessner as the Bank's Senior Vice
President, Chief Financial Officer, Treasurer and Cashier. He is also the
Treasurer/ Cashier and Assistant Secretary of the Company. Prior to joining the
Bank, Mr. Wiessner had been Chief Financial Officer of Mid
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Valley Bank since 1995. Prior to joining Mid Valley Bank, Mr. Wiessner was an
Audit Manager with Perry-Smith and Company from 1990 to 1995.
Section 16(a) Compliance
------------------------
Section 16(a) of the Securities Exchange Act of 1934, as amended, (the
"Exchange Act") requires the Company's directors and executive officers and
persons who beneficially own more than ten percent of a registered class of the
Company's equity securities to file with the Commission initial reports of
ownership and reports of changes in ownership of common stock and other equity
securities of the Company. Officers, directors and greater than ten percent
shareholders are required by Commission regulations to furnish the Company with
copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of such reports
furnished to the Company and written representations furnished to the Company by
such officers, directors and ten percent shareholders, during the fiscal year
ended December 31, 1997, all Section 16(a) filing requirements applicable to its
officers, directors and ten percent shareholders were complied with other than
Mr. Kelly's inadvertent failure to file one Form 4 relating to director Kelly's
exercise of options for 7,500 shares of Common Stock at an exercise price of
$8.00 per share and subsequent sale of such shares of Common Stock at a price of
$15.50 per share during November 1997. Director Kelly corrected said failure by
filing a Form 5 with the Commission on February 11, 1998.
Item 10. EXECUTIVE COMPENSATION.
The following Summary Compensation Table sets forth for service in all
capacities to the Company and the Bank for the periods indicated the
compensation with respect to the Company's Chief Executive Officer and those
executive officers of the Company and the Bank whose salary and bonus exceeded
$100,000 in 1997.
[See Table on following page]
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<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Other Annual All Other
Name and Principal Position Year Salary Bonus Compensation(1) Compensation
- --------------------------- ---- ---------- ------- ------------- -------------
<S> <C> <C> <C> <C> <C>
W. Clarke Swanson, Jr., 1997 $124,800(2) $0 $ 2,425 $0
CEO 1996 125,300(2) 0 2,700 0
1995 46,600(2) 0 441 0
Brian J. Kelly, President 1997 $135,000(3) 0 9,600 8,489(5,6)
and COO 1996 135,000(3) 20,500 8,834 12,788(5,6)
1995 115,000(3) 27,682 8,530 6,900(5)
Dale A. Brain, SVP, Chief 1997 105,667(3) 8,500(4) 3,000 3,203(5,6)
Information Officer, of the
Bank
The following table sets forth the options exercised in 1997 and the
December 31, 1997, unexercised value of both vested and unvested options for the
Company's Chief Executive Officer and those executive officers of the Company
and the Bank whose salary and bonus exceeded $100,000 in 1997.
[See Table on following page]
<FN>
- --------
1 For the year ended December 31, 1997, consists of country club membership
for Mr. Swanson in the amount of $2,425; country club membership and auto
allowance for Mr. Kelly in the amount of $3,000 and $6,600 respectively; auto
allowance for Mr. Brain in the amount of $3,000.
2 Includes payments for attending meetings of the Board of Directors and
all committees thereof.
3 Includes amounts contributed by Mr. Kelly and Mr. Brain to the Napa
National Bancorp Stock Participation Plan.
4 Includes moving bonus.
5 Consists of contributions by the Company to the Napa National Bancorp
Stock Participation Plan for the benefit of Mr. Kelly and Mr. Brain.
6 Includes unpaid vacation for Mr. Kelly and Mr. Brain.
</FN>
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
AGGREGATE OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
Number of Shares of Common Value of Unexercised
Stock Underlying Unexercised In-The-Money Options
Options at December 31, 1997 at December 31, 1997(1)
---------------------------- -------------------------
Shares Acquired Value
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
W. Clarke
Swanson, Jr., CEO 0 0 10,000 0 $77,500 0
Brian J. Kelly,
President and COO 7,500 56,250(2) 12,500 0 95,975 0
Dale A. Brain,
SVP, Chief
Information Officer, 0 0 1,000 4,000 400 1,600
of the Bank
Members of the Board of Directors did not receive any compensation during
1997 for attendance at meetings of the Board of Directors and the committees
thereof. The 1997 director compensation package for directors of the Bank
included paying each director $200 for every board or committee meeting he or
she attends. Mr. Kelly, as a full-time employee of the Company and the Bank,
does not receive compensation as a director of the Bank. Chairpersons for the
committees of the board of directors of the Bank receive $300 for each meeting
they chair. This fee structure is intended to compensate the Chairpersons for
their additional time and effort required in fulfilling this role. The foregoing
fee schedule was effective for all of 1997. During 1997, the members of the
board of directors of the Bank, as a group, received a total of $81,000 for
attendance at all meetings of the board of directors of the Bank and the
committees thereof.
In January 1998, the boards of directors of both the Company and the Bank
decided to leave the 1998 director compensation package the same as the 1997
director compensation package.
Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The following table sets forth information as of April 21, 1998 (the
"Determination Date") pertaining to beneficial ownership of the Company's Common
Stock by each of the persons known to the Company to own 5% or more of the
Company's Common Stock, each of the directors of the Company, each of the "named
executive officers" (consisting of the Company's Chief Executive Officer, the
Company's President and Chief Operating Officer and the Bank's President, Chief
Information Officer, Chief Financial Officer and Chief Credit Officer) and all
of the directors of the Company and the "named executive officers" as a group.
The information contained herein has been obtained from the Company's records,
from information furnished directly by the individual or entity to the Company,
or from various filings made by the named individuals with the Commission.
<FN>
- --------
1 The estimated fair market value of the Company's Common Stock on
December 31, 1997 was $15.75 per share.
2 In November, 1997, Mr. Kelly acquired 7,500 shares of Common Stock upon
the exercise of options at an exercise price of $8.00 per share. The fair
market value per share of Common Stock on the exercise date was $15.50
per share.
</FN>
</TABLE>
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<PAGE>
The table should be read with the understanding that more than one person
may be the beneficial owner or possess certain attributes of beneficial
ownership with respect to the same securities. Therefore, careful attention
should be given to the footnote references set forth in the column "Amount and
Nature of Beneficial Ownership." In addition, shares of Common Stock issuable
pursuant to options which may be exercised within 60 days of the Determination
Date are deemed to be issued and outstanding and have been treated as
outstanding in calculating the percentage ownership of those individuals
possessing such interest, but not for any other individuals. Thus, the total
number of shares considered to be outstanding for the purposes of this table may
vary depending upon the individual's particular circumstances.
[See Table on following page]
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<PAGE>
<TABLE>
<CAPTION>
Amount and Nature
of Beneficial Percent of
Name and Address of Beneficial Owner(1) Ownership(2) Class
<S> <C> <C>
William A. Bacigalupi 10,200(3) 1.3%
Dale A. Brain 1,000(4) *
Dennis D. Groth 5,100(5) *
E. James Hedemark 7,600(6) 1.0%
Michael D. Irwin 12,000(3) 1.5%
Brian J. Kelly 12,725(7) 1.6%
C. Richard Lemon 80,911(8) 10.2%
Joseph G. Peatman 10,125(3) 1.3%
A. Jean Phillips 7,600(6) 1.0%
George M. Schofield 79,811(9) 10.1%
W. Clarke Swanson, Jr. 526,727(10) 66.4%
Napa National Bancorp Stock Participation Plan 69,611(11) 8.9%
(the "Stock Plan")
All directors, nominees and named executive 684,188(12) 78.4%
officers as a Group (13 persons)
<FN>
- --------
* Indicates that the percentage of outstanding shares beneficially owned is
less than one percent (1%).
1 The address for all persons is: c/o Napa National Bancorp, 901 Main Street,
Napa, CA 94559. The Stock Plan's address is: Napa National Bancorp Stock
Participation Plan, Mr. C. Richard Lemon, Co-Trustee, 901 Main Street, Napa, CA
94559.
2 Includes shares beneficially owned, directly and indirectly, together
with associates. Subject to applicable community property laws and shared voting
or investment power with a spouse, the persons listed have sole voting and
investment power with respect to such shares unless otherwise noted.
3 Includes 10,000 shares which may be acquired upon the exercise of stock
options.
4 Includes 1,000 shares which may be acquired upon the exercise of stock
options.
5 Includes 5,000 shares which may be acquired upon the exercise of stock
options.
6 Includes 7,500 shares which may be acquired upon the exercise of
stock options.
7 Includes 12,500 shares which may be acquired upon the exercise
of stock options.
8 Includes 10,000 shares which may be acquired upon the exercise of stock
options. Includes 800 shares held in an individual retirement
account. Includes 69,611 shares held in the Stock Plan of which Mr. Lemon is a
co-trustee and with regard to which shares Mr. Lemon has shared voting and
investment power. Mr. Lemon disclaims beneficial ownership as to the Stock Plan
shares.
9 Includes 6,000 shares which may be acquired upon the exercise of stock
options. Includes 4,000 shares held in an individual retirement account.
Includes 69,611 shares held in the Stock Plan of which Mr. Schofield is
co-trustee and with regard to which shares Mr. Schofield has shared voting and
investment power. Mr. Schofield disclaims beneficial ownership as to the Stock
Plan shares.
10 Includes 10,000 shares which may be acquired upon the exercise
of stock options. Includes 9,271 shares held of record by minor relatives living
with Mr. Swanson. Mr. Swanson may be deemed to be a "control person" of the
Company within the meaning of the rules and regulations of the SEC by virtue of
his ownership interest in the Company.
11 Voting and investment power over the shares beneficially owned by the Stock
Plan is shared among its two co-trustees, Mr. Lemon and Mr. Schofield both of
whom disclaim beneficial ownership of all of said shares.
12 Includes 89,500 shares which may be acquired within 60 days of
the Record Date upon the exercise of stock options.
</FN>
</TABLE>
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<PAGE>
Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Purchase Right
--------------
In 1987, Mr. Swanson acquired 300,701 shares of the Company's Common Stock
through a tender offer at $11.00 per share (the "Tender Offer"), net to the
sellers in cash. The Tender Offer was made pursuant to the terms of an agreement
with the Company, dated as of February 5, 1987 (the "Purchase Agreement").
As disclosed to shareholders in materials related to the Tender Offer, the
Purchase Agreement provides, among other things, certain protections against
dilution of Mr. Swanson's stock ownership by requiring that if the Company
should desire to issue any Equity Securities (as defined below), it shall give
Mr. Swanson first right to purchase (the "Purchase Right") a portion of such
Equity Securities up to an amount which will enable Mr. Swanson to maintain the
same percentage of ownership of the outstanding Common Stock as held by Mr.
Swanson on the date immediately following his purchases in the Tender Offer
(i.e., 60.14%). In the event that the number of shares of Common Stock owned by
Mr. Swanson should decline due to Mr. Swanson's failure to purchase shares
pursuant to such right or sales of shares of Common Stock by Mr. Swanson, the
Purchase Agreement provides that the Purchase Right entitles Mr. Swanson to
purchase a new portion of new issuances of Equity Securities up to an amount
which will enable Mr. Swanson to maintain his percentage ownership of the
outstanding Common Stock as computed immediately prior to each issuance of such
Equity Securities.
The Purchase Right also applies to issuances of Equity Securities to
employees, officers and directors under stock option plans approved by the Board
of Directors of the Company, provided, however, that Common Stock shall be
deemed to have been issued only upon the exercise of an employee stock option.
The Purchase Agreement further states that if Mr. Swanson has a right to
purchase Common Stock due to the exercise of a stock option by an employee,
officer or director of the Company, the purchase price of such Common Stock
purchasable by Mr. Swanson shall be equal to the exercise price of such option.
The term "Equity Securities" is defined in the Purchase Agreement to mean
Common Stock, rights, options (except stock options issued pursuant to stock
option plans), warrants to purchase Common Stock, any security other than Common
Stock having voting rights in the election of the Board of Directors which are
not contingent upon a failure to pay dividends, any security convertible into or
exchangeable for any of the foregoing, and any agreement or commitment to issue
any of the foregoing.
The Purchase Right terminates when Mr. Swanson ceases to own in excess of
10% of the then outstanding shares of Common Stock.
Insider Participation
---------------------
Directors Lemon and Peatman are directors of the Bank and of the Company.
Both are shareholders in Dickenson, Peatman & Fogarty, a Professional Law
Corporation, which provided legal services to the Company and the Bank during
1996 and 1997 and which expects to provide
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legal services during 1998. Mr. Peatman serves on the Compensation
Committee of the Company and performs equivalent functions for Directors,
Peatman & Fogarty. Mr. Lemon is a co-trustee of the Stock Plan.
Indebtedness of Management
--------------------------
Some of the Company's directors and executive officers, as well as their
immediate family and associates, are customers of, and have had banking
transactions with, the Bank in the ordinary course of the Bank's business, and
the Bank expects to have such ordinary banking transactions with these persons
in the future. In the opinion of management of the Company, all loans and
commitments to lend included in such transactions were made in the ordinary
course of business on substantially the same terms, including interest rates and
collateral, as those prevailing for comparable transactions with other persons
of similar creditworthiness, and did not involve more than a normal risk of
collectibility or present other unfavorable features. Although the Bank does not
have any limits on the aggregate amount it would be willing to lend to directors
and officers as a group, loans to individual directors and officers must comply
with the Bank's respective lending policies and statutory lending limits, and
prior approval of the Bank's board of directors is required for these types of
loans.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: April 29, 1998
NAPA NATIONAL BANCORP
By /s/ Brian J. Kelly
-------------------------------
Brian J. Kelly
President/COO
By /s/ Michael D. Irwin
-------------------------------
Michael D. Irwin
Chief Financial Officer
(Principal Accounting Officer)
In accordance with the Exchange Act, this report has been signed below by
the following person on behalf of the registrant and in the capacities and on
the dates indicated.
April 29, 1998 /s/ William A. Bacigalupi*
------------------------------------
William A. Bacigalupi
Director
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<PAGE>
April 29, 1998 /s/ Dennis D. Groth*
---------------------------------
Dennis D. Groth
Director
April 29, 1998 /s/ E. James Hedemark*
----------------------------------
E. James Hedemark
Director
April 29, 1998 /s/ Michael D. Irwin*
---------------------------------
Michael D. Irwin
Director
Chief Financial Officer
(Principal Accounting Officer)
April 29, 1998 /s/ Brian J. Kelly*
---------------------------------
Brian J. Kelly
President and COO
Director
April 29, 1998 /s/ C. Richard Lemon*
----------------------------------
C. Richard Lemon
Secretary and Director
April 29, 1998 /s/ Joseph G. Peatman*
----------------------------------
Joseph G. Peatman
Director
April 29, 1998 /s/ A. Jean Phillips*
----------------------------------
A. Jean Phillips
Director
April 29, 1998 /s/ George M. Schofield*
-----------------------------------
George M. Schofield
Director
April 29, 1998 /s/ W. Clarke Swanson, Jr.*
------------------------------------
W. Clarke Swanson, Jr.
Chairman of the Board and CEO
* By /s/ Brian J. Kelly
--------------------------------
Brian J. Kelly
Attorney-in-Fact
By Power of Attorney
Previously Filed with the Commission
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