<PAGE>
===============================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
[Effective as of March 14, 2000]
The PNC Financial Services Group, Inc. (formerly PNC Bank Corp.)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] 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:
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(2) Aggregate number of securities to which transaction applies:
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(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:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
Thomas H. O'Brien
Chairman and Chief Executive Officer
[LOGO OF PNC FINANCIAL SERVICES GROUP]
March 17, 2000
Dear Shareholder:
You will find enclosed the notice of meeting, proxy statement and
proxy card for the annual meeting of shareholders of The PNC
Financial Services Group, Inc., which will be held on Tuesday, April
25, 2000, on the 15th floor of One PNC Plaza, in Pittsburgh,
Pennsylvania, beginning at 11:00 a.m. Our 1999 Annual Report to
Shareholders accompanies these enclosures.
Please review the enclosed material and complete, sign, date and
return the proxy card regardless of whether you plan to attend the
annual meeting, so that the matters coming before the meeting can be
acted upon.
As described in the Annual Report, our name change from PNC Bank
Corp. reflects our progress in transitioning to a national,
diversified financial services organization, an ongoing focus of our
strategies that we look forward to discussing with you at the annual
meeting.
Cordially,
/s/ Thomas H. O'Brien
Thomas H. O'Brien
The PNC Financial Services Group
One PNC Plaza 249 Fifth Avenue Pittsburgh Pennsylvania 15222-2707
<PAGE>
[LOGO OF PNC FINANCIAL SERVICES GROUP]
March 17, 2000
Notice of Annual Meeting of Shareholders
APRIL 25, 2000
To The Shareholders:
The annual meeting of the shareholders of The PNC Financial Services
Group, Inc., formerly PNC Bank Corp. ("Corporation"), will be held
on the 15th floor of One PNC Plaza, 249 Fifth Avenue, Pittsburgh,
Pennsylvania, on Tuesday, April 25, 2000, beginning at 11:00 a.m.,
local time, for the purpose of considering and acting upon the
following matters:
(1) The election of 17 directors to serve until the next annual
meeting and until their successors are elected and qualified;
and
(2) Such other business as may properly come before the meeting or
any adjournment thereof.
Shareholders of record at the close of business on February 28, 2000
(except for holders of the Corporation's Fixed/Adjustable Rate
Noncumulative Preferred Stock, Series F) are entitled to receive
notice of, and to vote at, the meeting and any adjournment thereof.
A proxy statement, form of proxy and self-addressed envelope are
enclosed. Please complete, date and sign the proxy card. Return it
promptly in the envelope provided, which requires no postage if
mailed in the United States. If you attend the meeting, you may
withdraw your proxy and vote in person, if you so choose.
By Order of the Board of Directors,
/s/ Thomas R. Moore
Thomas R. Moore
Corporate Secretary
The PNC Financial Services Group
One PNC Plaza 249 Fifth Avenue Pittsburgh Pennsylvania 15222-2707
<PAGE>
[LOGO OF PNC FINANCIAL SERVICES GROUP]
March 17, 2000
Proxy Statement
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
APRIL 25, 2000
The enclosed proxy is being solicited by the Board of Directors ("Board of
Directors" or "Board") of The PNC Financial Services Group, Inc., formerly PNC
Bank Corp. ("Corporation" or "PNC"), for use at the Corporation's annual
meeting of shareholders to be held April 25, 2000, or at any adjournment
thereof ("meeting" or "annual meeting"). Solicitation of proxies may be made
by mail, personal interviews, telephone and facsimile by officers and
employees of the Corporation and its subsidiaries. The Corporation has
retained D. F. King & Co., Inc. to assist in the solicitation of proxies for a
fee of $12,500 plus out-of-pocket expenses. Brokerage houses and other
custodians, nominees and fiduciaries will be requested to forward soliciting
material to the beneficial owners of the stock held of record by such persons.
Expenses for such solicitation will be borne by the Corporation. The proxy
statement and form of proxy are first being mailed to shareholders on or about
March 17, 2000.
The enclosed proxy is revocable at any time prior to the time voting is
declared closed by the filing of an instrument revoking it, or a duly executed
proxy bearing a later date, with the Corporate Secretary of the Corporation or
by attending the meeting and voting in person. All properly executed proxies
received by the Corporate Secretary prior to the time voting is declared
closed, and not revoked prior to that time, will be voted at the meeting in
accordance with instructions, if any. Unless otherwise directed, proxies will
be voted FOR the election as director of each of the persons named on page 3.
The Board of Directors has fixed the close of business on February 28, 2000
as the record date for determining shareholders entitled to receive notice of
and to vote at the meeting and any adjournment thereof ("Record Date"). On the
Record Date, there were issued and outstanding 292,548,003 shares of the
Corporation's common stock, par value $5.00 per share ("Common Stock"), and
the following shares of the Corporation's preferred stock entitled to vote at
the meeting: 11,901 shares of $1.80 Cumulative Convertible Preferred Stock-
Series A ("Preferred Stock-A"); 3,348 shares of $1.80 Cumulative Convertible
Preferred Stock-Series B ("Preferred Stock-B"); 252,206 shares of $1.60
Cumulative Convertible Preferred Stock-Series C ("Preferred Stock-C"); and
363,467 shares of $1.80 Cumulative Convertible Preferred Stock-Series D
("Preferred Stock-D") (collectively, "Voting Preferred Stock"). As of the
Record Date, there were 6,000,000 shares of Fixed/Adjustable Rate
Noncumulative Preferred Stock, Series F ("Preferred Stock-F") issued and
outstanding. Holders of Preferred Stock-F have no voting rights except in
limited circumstances which are not anticipated to come before the annual
meeting for a vote, and therefore were not entitled to receive notice of the
meeting.
The holders of Common Stock are entitled to one vote per share. Holders of
each share of Voting Preferred Stock are entitled to a number of votes equal
to the number of full shares of Common Stock which can be acquired upon
conversion of such preferred stock, with holders of Preferred Stock-A and
Preferred Stock-B being entitled to 8 votes per share and holders of Preferred
Stock-C and Preferred Stock-D being entitled to 4 votes
1
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per 2.4 shares. Holders of record of the Common Stock and Voting Preferred
Stock will vote together as a single class at the meeting, as described in the
section captioned "Voting Procedures" on page 23. The presence in person or by
proxy of shareholders entitled to cast at least a majority of the votes that
all holders of the Common Stock and the Voting Preferred Stock are entitled to
cast at the meeting will constitute a quorum for the transaction of business
at the meeting.
The Corporation will provide, without charge to each shareholder upon
written request, a copy (without exhibits, unless otherwise requested) of the
Corporation's Annual Report on Form 10-K for the year ended December 31, 1999,
required to be filed with the Securities and Exchange Commission ("SEC").
Requests for copies should be addressed to Lynn Fox Evans, Director of
Financial Reporting, The PNC Financial Services Group, Inc., One PNC Plaza,
249 Fifth Avenue, Pittsburgh, Pennsylvania 15222-2707. Requests may also be
directed to (412) 762-1553 or via e-mail to [email protected].
Copies may also be accessed electronically by means of the SEC's home page on
the Internet at www.sec.gov. Neither the Annual Report on Form 10-K nor the
1999 Annual Report to Shareholders is part of the proxy solicitation
materials.
ITEM 1
ELECTION OF DIRECTORS
Information Concerning Nominees
The By-Laws of the Corporation provide that the number of directors shall
not be fewer than five nor more than 36 as from time to time determined by the
Board of Directors. Pursuant to the recommendation of its Committee on
Corporate Governance, the Board has acted to fix at 17 the number of directors
to be elected at the annual meeting and to nominate the persons named on page
3 for election as directors, to hold office until the next annual meeting of
shareholders and the election and qualification of their successors. Mr.
Richard P. Simmons has decided to retire from the Board of Directors as of
April 25, 2000 and will not be standing for reelection. Mr. Thomas A. Corcoran
is standing for election for the first time.
The proxies solicited hereby, unless directed to the contrary therein, will
be voted FOR all nominees named below. All such nominees are now directors of
the Corporation, except for Mr. Corcoran. All nominees have consented to being
named in this proxy statement and to serve if elected. The Board of Directors
has no reason to believe that any nominee will be unavailable or unable to
serve as a director, but if for any reason any nominee should not be available
or able to serve, the accompanying proxy will be voted by the persons acting
under said proxy in accordance with the recommendations of the Board of
Directors.
The table on page 3 sets forth the names of the nominees for election as
directors of the Corporation; their principal occupations as of January 14,
2000; the year the nominees first became directors of the Corporation; and
their directorships of certain other companies. Except for Mr. Corcoran, all
nominees have held the position indicated or another senior executive position
with the same entity or one of its affiliates or a predecessor corporation for
at least the past five years. Mr. Corcoran was elected President and Chief
Executive Officer of Allegheny Technologies Incorporated effective October 1,
1999. Prior to joining Allegheny Technologies Incorporated, he served as
president and chief operating officer, electronics sector, for Lockheed Martin
Corporation from 1993 to 1998, when he was appointed president and chief
operating officer for Lockheed Martin Corporation's space sector. He served in
that position until joining Allegheny Technologies Incorporated in 1999. Mr.
Corcoran began his career in 1967 with General Electric Company, where he
served as a corporate vice president from 1990 until 1993.
2
<PAGE>
<TABLE>
<CAPTION>
Directorships in Companies
Other than the Corporation
Director Filing Reports with the
Name Age Principal Occupation Since SEC
- ---- --- -------------------- -------- --------------------------
<S> <C> <C> <C> <C>
Paul W. Chellgren 57 Chairman and Chief Executive 1995 Ashland Inc.; Arch Coal, Inc.;
Officer of Ashland Inc. (energy and
company) Medtronic, Inc.
Robert N. Clay 53 President and Chief Executive 1987 None
Officer of Clay Holding Company
(investments)
Thomas A. Corcoran 55 President and Chief Executive * Allegheny Technologies
Officer of Allegheny Technologies Incorporated;
Incorporated (specialty metals) L-3 Communications Corporation;
Lincoln Electric Holdings, Inc.;
Remec, Inc.; and Teledyne
Technologies Incorporated
George A. Davidson, Jr. 61 Chairman of Dominion Resources, 1988 Dominion Resources, Inc.; and
Inc. (public utility B.F. Goodrich Company
holding company)
David F. Girard-diCarlo 57 Co-Chairman and Managing Partner 1995 None
of Blank Rome Comisky & McCauley
LLP (law firm)
Walter E. Gregg, Jr. 58 Vice Chairman of the Corporation 1998 BlackRock, Inc.
William R. Johnson 51 President and Chief Executive 1997 Amerada Hess Corporation;
Officer of H.J. Heinz Company Cincinnati Financial Corporation;
(food products company) and
H.J. Heinz Company
Bruce C. Lindsay 58 Chairman and Managing Director of 1995 None
Brind-Lindsay & Co., Inc.
(advisory company)
W. Craig McClelland 65 Retired Chairman and Chief 1985 Allegheny Technologies
Executive Officer of Union Camp Incorporated;
Corporation (paper manufacturing International Paper Co.; and
and land resources) Water Pik Technologies, Inc.
Thomas H. O'Brien 63 Chairman and Chief Executive 1983 Bell Atlantic Corporation;
Officer of the Corporation+ BlackRock, Inc.;
Hilb, Rogal and Hamilton Company;
US Airways Group, Inc.; and
Viasystems Group, Inc.
Jane G. Pepper 54 President of Pennsylvania 1997 None
Horticultural Society
(nonprofit horticultural
membership organization)
Jackson H. Randolph 69 Chairman of Cinergy Corp. (public 1988 Cinergy Corp.; and
utility holding company) Cincinnati Financial Corporation
James E. Rohr 51 President and Chief Operating 1989 Allegheny Technologies
Officer of the Corporation+ Incorporated;
BlackRock, Inc.; Equitable
Resources, Inc.; and
Water Pik Technologies, Inc.
Roderic H. Ross 69 Vice Chairman and Chief Executive 1979 Hunt Corp.; and PMA Capital Corp.
Officer of Keystone State Life
Insurance Company
(insurance company)
Thomas J. Usher 57 Chairman and Chief Executive 1992 USX Corporation; and
Officer of USX PPG Industries, Inc.
Corporation (energy, steel and
diversified business)
Milton A. Washington 64 President and Chief Executive 1994 None
Officer of Allegheny Housing
Rehabilitation Corporation
(housing rehabilitation and
construction)
Helge H. Wehmeier 57 President and Chief Executive 1992 None
Officer of Bayer
Corporation (healthcare, life
sciences and chemicals)
</TABLE>
- --------
* Mr. Corcoran is standing for election for the first time.
+ Mr. O'Brien will retire as the Corporation's Chief Executive Officer
effective May 1, 2000, but not as Chairman of the Board. Mr. Rohr will
become the Corporation's Chief Executive Officer as of May 1, 2000 and will
retain the title of President.
3
<PAGE>
Board and Committees
The Board of Directors has six standing committees: an Audit Committee; a
Committee on Corporate Governance; a Credit Committee; an Executive Committee;
a Finance Committee; and a Personnel and Compensation Committee.
The Audit Committee is responsible for providing assistance to the Board of
Directors in fulfilling its legal and fiduciary obligations with respect to
matters involving the accounting, financial reporting, internal control, and
compliance functions of the Corporation and its subsidiaries. The Committee
oversees the audit function and recommends to the Board of Directors the
appointment of the independent auditors. It also reviews with the internal
auditors and the independent auditors their annual audit plans and monitors
their progress during the year. In discharging its responsibilities, the
Committee is entitled to rely upon the reports, findings, and representations
of the Corporation's auditors, legal counsel, and responsible officers. The
Committee is presently composed of Ms. Pepper and Messrs. Wehmeier (Chairman),
Girard-diCarlo, Lindsay and Randolph.
The Committee on Corporate Governance is responsible for recommending to the
Board of Directors persons to be nominated for election or appointment as
directors of the Corporation and monitoring and recommending enhancements to
the Corporation's corporate governance framework, particularly with respect to
the structure, processes, and proceedings of the Board of Directors. In
performing the nominating function, the Committee may consider director
nominees recommended by shareholders. Such recommendations with respect to the
2001 annual meeting of shareholders must be submitted in writing no later than
November 17, 2000 to the Corporate Secretary, The PNC Financial Services
Group, One PNC Plaza, 249 Fifth Avenue, Pittsburgh, Pennsylvania 15222-2707,
and include the name, age, citizenship, business and residence addresses,
qualifications, including principal occupation or employment, and
directorships and other positions held by the proposed nominee in business,
charitable, and community organizations. For information on the requirements
governing shareholder nominations for the election of directors to be made at
an annual meeting of shareholders, please see the section captioned
"Shareholder Proposals and Nominations" beginning on page 24. The Committee is
presently composed of Ms. Pepper and Messrs. Davidson (Chairman), Randolph,
Ross, Simmons, Usher and Wehmeier.
The Credit Committee is responsible for reviewing and approving (when
appropriate) loan policies and reports of compliance therewith; reviewing
credit policy committee activities; and reviewing reports regarding lending
and credit activities, as well as the Corporation's credit quality. The
Committee is presently composed of Messrs. McClelland (Chairman), Davidson,
Girard-diCarlo, Rohr, Ross and Washington.
The Executive Committee has all the powers of the Board of Directors to the
extent permitted by law and can exercise such powers between meetings of the
Board of Directors. The Committee is presently composed of Messrs. Simmons
(Chairman), Chellgren, Davidson, Gregg, McClelland, O'Brien, Rohr, Usher and
Wehmeier.
The Finance Committee is primarily responsible for monitoring the
Corporation's interest rate and liquidity risks. In performing this function,
the Committee reviews and approves (when appropriate) key asset and liability
policies regarding interest rate sensitivity, financial derivatives and
funding needs and reviews management reports regarding these policies and
activities related thereto. The Committee's responsibilities also include
oversight of the Corporation's capital management activities and trading
activities, including related market risk management policies and risk limits.
The Committee also provides oversight of the fiduciary activities of the
Corporation's subsidiaries and the activities of the Corporation's Pension
Plan Committee, Retirement Savings Plan Committee and the Incentive Savings
Plan Committee. The Committee is presently composed of Messrs. Chellgren
(Chairman), Clay, Gregg, Lindsay, O'Brien and Simmons.
The Personnel and Compensation Committee is responsible for recommending to
the Board of Directors the persons to be elected as Chairman, Chief Executive
Officer, President, and Vice Chairman of the Corporation and establishing the
compensation of the executive officers of the Corporation. The Committee also
makes recommendations to the Board of Directors or otherwise takes action
regarding the adoption or amendment of
4
<PAGE>
employee benefit, bonus, incentive compensation or similar plans and is
responsible for their oversight or administration. The Committee is presently
composed of Messrs. Usher (Chairman), Chellgren, Clay, Johnson, McClelland and
Washington.
The Board of Directors met twelve times during 1999. During 1999, the
Board's committees held the following number of meetings: Audit Committee-
five meetings; Committee on Corporate Governance-three meetings; Credit
Committee-four meetings; Executive Committee-one meeting; Finance
Committee-four meetings; and Personnel and Compensation Committee-five
meetings.
In 1999, each director then serving attended at least 75% of the combined
total of meetings of the Board of Directors and each committee of the Board on
which such director served.
Compensation of Directors
Executive officers of the Corporation who are directors or members of
committees of the Board of Directors of the Corporation or its subsidiaries
receive no compensation for serving in such positions. All non-officer
directors of the Corporation are compensated for their Board services by a per
diem fee of $1,200 for any day's participation in a Board or committee
meeting, or any combination thereof, an annual retainer fee of $37,000 for
Board membership and, in accordance with the terms of the Corporation's 1992
Director Share Incentive Plan ("Director Share Plan"), an annual grant equal
to a number of shares of Common Stock having a fair market value on the date
of the award equal to $5,000, rounded up to the nearest whole share. In
addition, the chairman of each standing committee receives a $5,000 annual
retainer fee. For 1999, the Corporation did not pay more than $72,200 in
aggregate fees, including the value of Common Stock awarded pursuant to the
Director Share Plan, to any one director.
Under the terms of the Directors Deferred Compensation Plan, non-officer
directors may elect to defer the receipt of all or a portion of the cash
compensation otherwise payable to them as a result of their service as a
director. The minimum deferral amount is $10,000 per year. A director may
elect one of two investment options with respect to amounts deferred: an
interest rate alternative or an investment in phantom shares of Common Stock.
Investment elections may be changed quarterly. A director may also elect the
event or date when amounts credited to his or her account are paid out and
whether the payout shall be in a lump sum or a designated number of annual
installments (not to exceed ten annual installments). The director may
designate a beneficiary to receive unpaid amounts in the account upon the
director's death.
The discussion which follows describes a newly-adopted plan which provides
for annual grants of deferred stock units to non-officer directors.
In order to increase the stock-based component of the compensation received
by non-officer directors, the Board of Directors, acting upon the
recommendations of the Committee on Corporate Governance and an independent
compensation consultant reporting to the Committee, approved the PNC Outside
Directors Deferred Stock Unit Plan at its November 18, 1999 meeting. Under the
Deferred Stock Unit Plan, an unfunded recordkeeping account has been
established for each non-officer director currently serving on the Board. Such
an account will also be established for each future non-officer director
elected or appointed to the Board. The Committee on Corporate Governance is
generally responsible for administration of the plan.
Beginning with a grant date of January 3, 2000, the Committee on Corporate
Governance has approved an annual grant of deferred stock units having a value
of $35,000 to each non-officer director's plan account. The amount of this
annual grant is subject to future adjustments.
A deferred stock unit is a phantom share of Common Stock. Prior to a
director's retirement, the value of deferred stock units credited to a
director's account will track the performance of the Common Stock and will be
valued on a quarterly basis. The plan provides for the deemed reinvestment of
dividends in additional deferred stock units. Each director has the right to
elect an event or date when the deferred stock units credited to his or
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<PAGE>
her account will be redeemed and paid out in cash. That event or date
generally cannot precede the earlier of the director's retirement from the
Board or the date on which the director attains age 70. A director may elect
to receive payment in a lump sum or a designated number of annual
installments, not to exceed ten. A director may also designate one or more
beneficiaries to receive distributions from his or her account in the event of
death.
In conjunction with the adoption of the Deferred Stock Unit Plan, each non-
officer director opted out of the post-employment compensation arrangement
previously available to non-officer directors and that arrangement has been
terminated, except that retired directors now receiving benefits will be paid
the remaining annual installments due to them. Upon the non-officer directors'
relinquishment of their accrued rights under the previous post-employment
compensation arrangement, the Committee on Corporate Governance granted to
each current non-officer director deferred stock units equivalent to the
present value of his or her accrued benefit, discounted using a market rate of
interest. This one-time grant was credited to the director's plan account on
January 3, 2000. The maximum number of deferred stock units granted to any one
director as a one-time grant was 6,472.
Each non-officer director is also eligible to participate in a charitable
matching gift program, under which his or her personal gifts to qualifying
charitable organizations are matched up to an annual aggregate dollar amount
of $5,000.
Common Stock Purchase Guideline
In 1995, upon the recommendation of the Committee on Corporate Governance,
the Board of Directors adopted a Common Stock purchase guideline, which
provides that each non-officer director annually purchase Common Stock in an
amount equal to twenty-five percent of the annual retainer fee then in effect.
This guideline may be satisfied through open market purchases, participation
in the Corporation's Dividend Reinvestment and Stock Purchase Plan, or
investments in phantom shares of Common Stock in the Directors Deferred
Compensation Plan. During 1999, each director complied with this guideline.
6
<PAGE>
SECURITY OWNERSHIP OF DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS
The table below captioned "Security Ownership of Directors, Nominees and
Executive Officers" sets forth information concerning beneficial ownership of
the Corporation's Common Stock as of January 14, 2000, by each director and
nominee for election as a director, each of the five executive officers named
in the Summary Compensation Table on page 16 and all directors, nominees and
executive officers of the Corporation as a group. Except as otherwise noted,
each individual exercises sole voting and investment power over the shares of
Common Stock shown. The separate table captioned "Common Stock Unit Ownership"
shows phantom or deferred Common Stock units owned by the individual or group
through the compensation or benefit plan identified in the corresponding
footnote. The Common Stock units can be settled only in cash. The number of
shares of Common Stock shown in the Security Ownership Table as beneficially
owned by each director and executive officer is determined under the rules of
the SEC and the information is not necessarily indicative of beneficial
ownership for any other purpose. For purposes of the Security Ownership Table,
beneficial ownership includes any shares of Common Stock as to which the
individual has sole or shared voting power or investment power and also any
shares of Common Stock that the individual has the right to acquire within 60
days of January 14, 2000, through the exercise of any option, warrant or
right.
Security Ownership of Directors, Nominees and Executive
Officers
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Amount and Nature
of Beneficial Ownership
- ---------------------------------------------------------------------------------------------------------
Name Common Stock*
- ---------------------------------------------------------------------------------------------------------
-------------------------
<S> <C>
Paul W. Chellgren 6,224(/1/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Robert N. Clay 4,031(/1/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Thomas A. Corcoran+ 0
- ---------------------------------------------------------------------------------------------------------
-------------------------
George A. Davidson, Jr. 9,647
- ---------------------------------------------------------------------------------------------------------
-------------------------
David F. Girard-diCarlo 3,045(/2/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Walter E. Gregg, Jr. 213,840(/3/)(/4/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Joseph C. Guyaux 110,591(/3/)(/4/)(/5/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
William R. Johnson 304(/2/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Bruce C. Lindsay 4,628
- ---------------------------------------------------------------------------------------------------------
-------------------------
W. Craig McClelland 5,189(/2/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Jane G. Pepper 1,304
- ---------------------------------------------------------------------------------------------------------
-------------------------
-------------------------
Thomas H. O'Brien 1,056,519(/3/)(/4/)(/5/)(/6/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Jackson H. Randolph 12,273
- ---------------------------------------------------------------------------------------------------------
-------------------------
James E. Rohr 517,641(/3/)(/4/)(/5/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Roderic H. Ross 7,071
- ---------------------------------------------------------------------------------------------------------
-------------------------
Richard P. Simmons++ 89,729(/2/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Thomas J. Usher 5,592
- ---------------------------------------------------------------------------------------------------------
-------------------------
Milton A. Washington 19,425
- ---------------------------------------------------------------------------------------------------------
-------------------------
Helge H. Wehmeier 4,259
- ---------------------------------------------------------------------------------------------------------
-------------------------
Thomas K. Whitford 75,060(/2/)(/3/)(/4/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Directors, nominees and executive officers as a group
(26 persons)*/** 2,643,621(/1/)(/2/)(/3/)(/4/)(/5/)(/6/)(/7/)
- ---------------------------------------------------------------------------------------------------------
-------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
Common Stock Unit
Name Ownership
- ---------------------------------------------------------------------------------------------------------
-------------------------
<S> <C> <C>
Paul W. Chellgren 7,818(a)(b)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Robert N. Clay 6,473(a)(b)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Thomas A. Corcoran+ 0
- ---------------------------------------------------------------------------------------------------------
-------------------------
George A. Davidson, Jr. 5,326(a)
- ---------------------------------------------------------------------------------------------------------
-------------------------
David F. Girard-diCarlo 2,875(a)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Walter E. Gregg, Jr. 14,087(c)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Joseph C. Guyaux 942(c)
- ---------------------------------------------------------------------------------------------------------
-------------------------
William R. Johnson 3,342(a)(b)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Bruce C. Lindsay 3,749(a)
- ---------------------------------------------------------------------------------------------------------
-------------------------
W. Craig McClelland 7,302(a)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Jane G. Pepper 2,725(a)(b)
- ---------------------------------------------------------------------------------------------------------
-------------------------
-------------------------
Thomas H. O'Brien 28,126(c)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Jackson H. Randolph 7,302(a)
- ---------------------------------------------------------------------------------------------------------
-------------------------
James E. Rohr 22,575(c)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Roderic H. Ross 7,302(a)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Richard P. Simmons++ 7,510(a)(b)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Thomas J. Usher 3,504(a)(b)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Milton A. Washington 7,302(a)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Helge H. Wehmeier 4,220(a)(b)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Thomas K. Whitford 3,485(c)(d)
- ---------------------------------------------------------------------------------------------------------
-------------------------
Directors, nominees and executive officers as a group
(26 persons)*/** 150,722(a)(b)(c)(d)
- ---------------------------------------------------------------------------------------------------------
-------------------------
</TABLE>
7
<PAGE>
+ Mr. Corcoran is standing for election for the first time.
++ Mr. Simmons is not standing for reelection.
* As of January 14, 2000, there were 292,757,835 shares of the Corporation's
Common Stock issued and outstanding. The number of shares of Common Stock
held by each individual is less than 1% of the outstanding shares of
Common Stock; the total number of shares of Common Stock held by the group
is also less than 1% of the class. No director, nominee or executive
officer owns shares of preferred stock of the Corporation. These
percentages were calculated by adding shares subject to employee stock
options to the foregoing number, if the options were either exercisable as
of January 14, 2000, or exercisable within 60 days of that date. The
number shown also includes 226,063 restricted shares of Common Stock held
by the 11 executive officers. The number of restricted shares held by each
executive officer named in the Summary Compensation Table on page 16 is
shown in footnote (d) to that table. No person is known by the Corporation
to own beneficially more than 5% of its Common or Voting Preferred Stock.
** Certain of the directors and executive officers also own shares of class A
common stock, par value $0.01 per share, issued by BlackRock, Inc.
("BlackRock"), a majority-owned investment management subsidiary of the
Corporation. BlackRock's class A common stock is listed on the New York
Stock Exchange under the symbol "BLK". The number of such shares
beneficially owned by individuals listed in the Security Ownership Table
are as follows: Ms. Pepper (1,000) and Messrs. Clay (10,000); Davidson
(10,000); Girard-diCarlo (5,000); Gregg (10,000); Guyaux (1,000); Lindsay
(7,500); O'Brien (10,000); Randolph (6,500); Rohr (10,000); Ross (1,000);
Simmons (10,000); Usher (10,000); Washington (10,000); and Wehmeier
(8,571). The total number of such shares owned by directors and executive
officers as a group (26 persons) is 127,571. The number of shares of
BlackRock class A common stock held by each individual is less than 1% of
the outstanding shares as of January 14, 2000; the total number of such
shares held by the group is approximately 1.41% of the class.
(1) Includes shares held in the PNC Bank Kentucky, Inc. Directors Deferred
Compensation Plan.
(2) Includes shares held jointly with spouse.
(3) Includes shares held in the Corporation's Incentive Savings Plan, a
qualified employee benefit defined contribution plan.
(4) Includes shares subject to employee stock options held by the executive
officers and either exercisable as of January 14, 2000, or exercisable
within 60 days of that date. The shares subject to such options are as
follows: Messrs. O'Brien (499,118 shares); Rohr (368,280 shares); Gregg
(173,017 shares); Guyaux (86,535 shares); and Whitford (55,936 shares).
The aggregate number of shares subject to such options for the remaining
six executive officers is 337,747.
(5) Includes shares held indirectly as trustee or custodian, as to which the
individual disclaims beneficial ownership.
(6) Includes shares owned by spouse, as to which the individual disclaims
beneficial ownership.
(7) Includes shares owned by children, as to which the individuals disclaim
beneficial ownership.
COMMON STOCK UNIT OWNERSHIP TABLE FOOTNOTES
(a) Includes deferred Common Stock units credited to an account established
under the Corporation's Outside Directors Deferred Stock Unit Plan.
(b) Includes phantom Common Stock units credited to an account established
under the Corporation's Directors Deferred Compensation Plan.
(c) Includes phantom Common Stock units held in the Corporation's Supplemental
Incentive Savings Plan, a non-qualified excess defined contribution plan.
(d) Includes phantom Common Stock units credited to an account established
under the Corporation's Deferred Compensation Plan.
8
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
Personnel and Compensation Committee Report
The following is the Personnel and Compensation Committee's report to
shareholders on the Corporation's executive compensation policies with respect
to compensation reported for fiscal year 1999. In accordance with the rules of
the SEC, this report shall not be incorporated by reference into any of the
Corporation's future filings made under the Securities Exchange Act of 1934 or
under the Securities Act of 1933, and shall not be deemed to be soliciting
material or to be filed under the Securities Exchange Act of 1934 or the
Securities Act of 1933.
Personnel and Compensation Committee Report on Executive Compensation for
Fiscal Year 1999
Key compensation-related responsibilities of the Personnel and Compensation
Committee ("Committee") of the Board of Directors ("Board"):
. Oversee The PNC Financial Services Group, Inc.'s ("Corporation") employee
benefit and compensation plans, policies and practices;
. Recommend to the Board or take other action regarding the adoption or
amendment of employee benefit and compensation plans;
. Conduct regular, comprehensive reviews of the Corporation's executive
compensation program; and
. Establish the annual compensation of the Corporation's executive
officers.
How the Committee functions:
. No Committee member can be a current or former Corporation officer.
. The Committee uses comparative compensation data for the financial
services industry and key management positions obtained from nationally-
recognized compensation consulting firms.
. The compensation data covers a peer group of selected bank holding
companies which compete in markets served by the Corporation ("Peer
Group"). The Peer Group is used by the Committee as the primary basis for
performance and compensation comparison purposes when making key
compensation-related decisions. The banking institutions included in the
Peer Group do not necessarily include the same banking institutions
included in the S&P Major Regional Banks Index used for the Common Stock
performance graph on page 22. This year's Common Stock performance graph,
however, also includes the median total shareholder return for the Peer
Group.
. The Committee is assisted by:
. An independent compensation consultant retained by the Committee; and
. The Corporation's internal support staffs.
The Corporation's executive compensation program is designed to:
. Attract, motivate and retain executive officers who can make significant
contributions to the Corporation's long-term success;
. Align the interests of executive officers with those of shareholders; and
. Place a significant proportion of an executive officer's total
compensation at risk by tying it to the Corporation's financial and
Common Stock price performance.
9
<PAGE>
Description of the three primary components of the Corporation's executive
compensation program: base salary; annual incentive awards; and long-term
incentive awards:
Base salary
. Base salaries are generally targeted at the middle of the competitive
marketplace.
. The "market rate" for an executive position is determined through an
annual assessment by the Corporation's human resources personnel. This
assessment considers relevant industry salary practices, the
position's complexity and level of responsibility, its importance to
the Corporation in relation to other executive positions, and the
competitiveness of an executive's total compensation.
. Specific compensation data obtained from Peer Group proxy statements
is referenced in establishing the salaries of the Corporation's Chief
Executive Officer, President and Chief Operating Officer, and Vice
Chairman.
. Subject to the Committee's approval, the level of an executive
officer's base pay is determined on the basis of:
. Relevant comparative compensation data; and
. The Chief Executive Officer's assessment of the executive's
performance, experience, demonstrated leadership, job knowledge and
management skills.
Annual incentive awards
. For 1999, annual incentive awards were made to the Chief Executive
Officer and the other four executive officers included in the
compensation tables beginning on page 16 ("named executive officers")
under the 1996 Executive Incentive Award Plan ("1996 Plan"), which was
approved by shareholders at the Corporation's 1996 annual meeting.
With respect to other eligible executive officers, awards were paid
under the annual incentive award plan discussed later in this report.
Participants in the 1996 Plan do not also receive an award under any
other annual incentive arrangement.
. These cash awards are intended to provide a linkage among executive
performance, annual objective performance measures, and long-term
shareholder value.
How annual incentive awards are calculated under the 1996 Plan:
. The 1996 Plan is designed to give the Committee the flexibility to
make annual incentive awards that are comparable to those found in the
marketplace in which the Corporation competes for executive talent.
The 1996 Plan permits the payment of annual incentive awards that are
intended to qualify as deductible, performance-based compensation
under Section 162(m) of the Internal Revenue Code of 1986, as amended
("Code").
. Before the end of the first quarter of 1999, the Committee assigned
each participant an incentive award amount, expressed as the maximum
percentage of the compensation pool available to that participant for
the 1999 award period. For 1999, the compensation pool was equal to
one-half of one percent of the Corporation's 1999 consolidated pre-tax
net income, as determined in accordance with generally accepted
accounting principles, after adjustment for unusual, infrequently
occurring or extraordinary items, as provided for under the terms of
the 1996 Plan.
. No participant can be assigned a percentage of the compensation pool
greater than 35% and the sum of all percentages assigned cannot exceed
100% of the compensation pool.
10
<PAGE>
During the first quarter of 2000, the Committee:
. Confirmed the identity of the executive officers eligible to
participate in the 1996 Plan;
. Computed and certified in writing the size of the compensation pool
for the 1999 award period, based upon financial information supplied
by the Corporation's officers; and
. Certified in writing the amount of the authorized incentive award to
be paid to each participant, based on:
. the maximum percentage of the compensation pool assigned to a
participant during the first quarter of 1999; and
. such qualitative or quantitative performance factors as the
Committee deemed relevant in adjusting the incentive award payable
to the level shown in the Summary Compensation Table on page 16, in
the column captioned "Bonus ($)," for the year 1999.
How annual incentive awards are calculated for executive officers not
participating in the 1996 Plan:
. The target amount payable to an executive officer as an annual
incentive award is based on an analysis of competitive pay practices
in the Peer Group and is expressed as a percentage of base salary.
. When setting the 1999 target annual incentive awards, the Committee
assumed that the 1999 target performance goal would be achieved.
Achievement of that goal would result in the payment of approximately
median total cash compensation.
. There are multiple factors that can affect the size of actual award
payments, including:
. "EPS Goal"--This goal is based on the Corporation's earnings per
share in relation to the Corporation's budget. The EPS Goal is
used as the primary performance measure when making annual
incentive awards. Management established, subject to Committee
approval, the target EPS Goal for 1999.
. "Relative Goals"--These goals are based primarily on the
Corporation's return on average common shareholders' equity
relative to the Peer Group, with additional consideration given to
the Corporation's return on average assets.
. Business financial performance relative to that Business's budget.
. The Chief Executive Officer's assessment of an executive officer's
performance is also considered.
. The Committee may, in its sole discretion, increase, reduce or
eliminate an executive officer's award, based on an assessment of
the officer's performance.
Long-term incentive awards
. The 1999 stock option grants were made under the shareholder-approved
1997 Long-Term Incentive Award Plan ("Long-Term Plan").
. The Long-Term Plan is intended to focus the efforts of executive
officers on performance that will increase the equity value of the
Corporation for its shareholders.
. The Committee may grant incentive stock options and nonstatutory stock
options to purchase shares of Common Stock. The options are granted at
an exercise price per share not less than the fair market value of a
share of Common Stock on the date of grant. The Committee may also
grant stock appreciation rights, performance units, and incentive or
restricted stock. For 1999, nonstatutory stock options were granted
and restricted shares of Common Stock were issued to selected
executive officers. No restricted shares were issued during 1999,
however, to the named executive officers.
11
<PAGE>
How the number of stock options granted under the Long-Term Plan is
determined:
. A number of stock options is established that would position the
executive officer competitively relative to the Peer Group with
respect to long-term compensation. This number is called the "base-
line amount" and is used as a reference point for upward and downward
adjustments to the stock option grant level. The base-line amount is
adjusted periodically in order to achieve the market competitive
objective.
. Each year, the stock option grant level may be adjusted upward or
downward from the base-line amount. This adjustment is based on the
Corporation's total shareholder return as compared with the Peer
Group.
. If the Corporation's total shareholder return is significantly higher
or lower than the Peer Group's median return, the number of options to
be granted will be adjusted above or below, respectively, the base-
line amount.
. Total shareholder return is based on Common Stock appreciation and
dividend payments for the three most recent years. For example, the
1999 grants were based on Common Stock appreciation and dividend
payments for the period 1996 through 1998. The base-line amount for
the 1999 grants was reduced by 5% from target levels.
Chief Executive Officer compensation
. With input from the Committee's independent compensation consultant, the
Committee decides matters affecting Mr. O'Brien's compensation privately,
without Mr. O'Brien or other officers present.
. The Committee considered:
. The Corporation's financial performance and Peer Group compensation
data; and
. Mr. O'Brien's leadership, decision-making skills, experience,
knowledge, communication with the Board and strategic recommendations,
as well as the Corporation's positioning for future performance.
. The Committee did not place any particular relative weight on one of
these factors over another, but the Corporation's financial
performance is generally given the most weight.
. The Committee's decisions regarding Mr. O'Brien's compensation are
reported to and discussed by the full Board at its next regularly
scheduled meeting. These discussions are conducted privately, without Mr.
O'Brien or other officers present.
. For 1999, the Committee's decisions regarding Mr. O'Brien's compensation
included the following:
. As discussed in the Committee's report in the 1999 annual meeting
proxy statement, the Committee granted to Mr. O'Brien 82,000 premium-
priced nonstatutory stock options in January 1999, with an exercise
price of $76.00 per share. This option grant, together with a premium-
priced option grant made in October 1998 with an exercise price of
$66.00 per share, was made in lieu of a 1998 Incentive Share Award
made under the Long-Term Plan to certain of the Corporation's other
executive officers.
. In February 1999, the Committee decided that Mr. O'Brien's 1999 base
salary would be increased to $1,000,000, effective as of February 20,
1999.
12
<PAGE>
. In deciding upon the size of Mr. O'Brien's 1999 incentive award payment,
the Committee considered these significant accomplishments, in addition
to the Corporation's EPS Goal and Relative Goals achievements, for 1999:
. Earnings for 1999 were a record $1.264 billion, compared with $1.115
billion for 1998.
. Core earnings were a record $1.199 billion or $3.93 per diluted share,
a 9% increase compared with 1998.
. PNC met or exceeded consensus earnings estimates and continued a
transition to a more valuable revenue and business mix.
. Noninterest income to total revenue increased to 55% for the fourth
quarter, driven by strategic acquisitions and strong growth in fee-
based businesses and is expected to reach approximately 60% by the end
of 2000.
. PFPC, PNC's investment servicing subsidiary, completed the acquisition
of First Data Investor Services Group, creating one of the nation's
leading full-service processors for pooled investment products.
. BlackRock, Inc., PNC's investment management subsidiary, completed an
initial public offering for approximately 14% of the equity ownership
of BlackRock.
. PNC implemented a number of strategic initiatives designed to improve
the risk and return characteristics of its lending businesses. These
included the sale of the credit card business, exiting certain non-
strategic wholesale lending businesses and the continued downsizing of
the indirect automobile lending portfolio.
. The Committee focused closely on the Corporation's 1999 financial
performance relative to the Peer Group, particularly the Corporation's
return on average common shareholders' equity. Assuming that the EPS Goal
for the year is met or exceeded, which was the case for 1999, the
Committee believes that this financial measure should be the primary
measure used in determining the size of the annual incentive awards
granted to Mr. O'Brien and the Corporation's other executive officers.
The Committee also considered the Corporation's 1999 return on average
assets relative to the Peer Group.
. The Committee considers the Peer Group to be indicative of the
Corporation's financial services competitors in terms of asset size and
mix of businesses. The Committee noted that the Corporation performed at
approximately the 75th percentile of the Peer Group in terms of its
return on average common shareholders' equity during 1999. Also important
to the Committee's deliberations was the fact that the Corporation's
price to earnings ratio improved from the lowest quartile of the Peer
Group at the beginning of 1999 to the median by year-end 1999.
. The Committee recognized that the Corporation's 1999 Common Stock
performance, like many other financial services sector stocks, compared
unfavorably with the S&P 500 Index or the S&P Major Regional Banks Index,
both of which are reflected on the Common Stock performance graph on page
22. Nevertheless, the median total shareholder return of the Peer Group
shown on that graph illustrates the Corporation's total shareholder
return in relation to what the Committee views as its most relevant
competitive group.
. Before arriving at its final decision regarding the amount of Mr.
O'Brien's annual incentive award, the Committee confirmed with its
independent compensation consultant that the Corporation's compensation
program is consistent with market place practices linking pay for
performance.
. After considering all of these factors carefully, the Committee
authorized the payment to Mr. O'Brien of $3,400,000 as an incentive award
for 1999.
13
<PAGE>
Tax policy
. Section 162(m) of the Code disallows a federal income tax deduction for
compensation over $1 million paid to the Chief Executive Officer and any of
the executive officers included in the compensation tables following this
report, subject to certain exceptions.
. One exception applies to compensation paid pursuant to shareholder-approved
plans that are performance based.
. The Committee intends that awards made under the 1996 Plan and the Long-
Term Plan be eligible for the performance-based exception, and therefore
eligible as a federal income tax deduction for the Corporation.
. The Committee has taken and will continue to take actions to minimize the
Corporation's nondeductible compensation expense under Section 162(m).
While keeping this goal in mind, the Committee also will try to maintain
the flexibility which the Committee believes to be an important element of
the Corporation's executive compensation program.
Conclusion:
. Based upon its review of the Corporation's executive compensation program,
the Committee has concluded that the program's basic structure is
appropriate, competitive and effective to serve the purposes for which it
was established.
MEMBERS OF THE COMMITTEE:
Thomas J. Usher (Chairman)
Paul W. Chellgren
Robert N. Clay
William R. Johnson
W. Craig McClelland
Milton A. Washington
14
<PAGE>
Compensation Committee Interlocks and Insider Participation
Messrs. Usher, Chellgren, Clay, Johnson, McClelland, and Washington, none of
whom are officers or former officers of the Corporation or any of its
subsidiaries, served as members of the Personnel and Compensation Committee
during 1999.
Certain members of the Personnel and Compensation Committee and their
associates were customers of and had transactions with the Corporation or its
subsidiaries during 1999. Transactions that involved loans or commitments by
subsidiary banks were made in the ordinary course of business and on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons and did
not involve more than the normal risk of collectibility or present other
unfavorable features.
Change in Control and Other Arrangements
The Corporation has entered into change in control severance agreements with
each of the executive officers named in the Summary Compensation Table, and
certain other executive officers. If the executive officer's employment is
terminated by the Corporation without cause, or by the executive officer for
good reason, during a period of up to three years (two years for certain
executive officers) following a change in control of the Corporation, the
executive officer will receive severance benefits, including (i) a lump sum
payment of up to three times (two times for certain executive officers) the
executive officer's annual base salary and bonus; (ii) the payment of at least
the target bonus for the executive officer for the fiscal year during which the
executive officer's employment is terminated; (iii) up to three years (two
years for certain executive officers) of additional benefits under certain of
the Corporation's retirement and benefit plans; and (iv) a payment to reimburse
the executive officer for any excise taxes on severance benefits that are
considered excess parachute payments under the Internal Revenue Code of 1986,
as amended ("Code"). Each agreement requires the executive officer not to use
or disclose any of the Corporation's confidential business information and, if
the executive officer receives the above severance benefits, not to employ or
solicit any officer of the Corporation during the year following the executive
officer's termination. Each agreement terminates when the executive officer
reaches age 65, and the Corporation may, upon one year's advance notice,
simultaneously terminate all of the change in control severance agreements.
The Corporation's displaced employee assistance plans for employees generally
provide an increase in severance benefits following a change in control under
certain circumstances. If an employee's employment is terminated by the
Corporation within two years following consummation of a change in control, the
employee will receive a lump sum payment equal to twice the benefits to which
such employee otherwise would be entitled under the applicable plan.
15
<PAGE>
Summary Compensation Table*
The Summary Compensation Table shows, for the years 1997 through 1999,
except as otherwise noted, the compensation paid or awarded to Mr. O'Brien,
the Corporation's Chairman and Chief Executive Officer, and the Corporation's
next four most highly compensated, policy-making executive officers; the
inclusion of the four executive officers other than Mr. O'Brien in this group
was based on salary and bonus earned during 1999. Mr. O'Brien and the other
four executive officers are referred to collectively as the Corporation's
"named executive officers." For a detailed discussion of the Corporation's
executive compensation program, please refer to the Personnel and Compensation
Committee Report on Executive Compensation beginning on page 9.
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
-------------------------------- ----------------------------------
Awards Payouts
---------- --------------
Other Securities
Annual Underlying Long-Term All
Name and Principal Comp Options/ Incentive Plan Other
Position Year Salary ($) Bonus ($) ($) SARS (#) Payouts ($) Comp ($)
- ------------------ ---- ---------- --------- ------ ---------- -------------- --------
(a) (b) (c)(d)
<S> <C> <C> <C> <C> <C> <C> <C>
Thomas H. O'Brien 1999 992,308 3,400,000 2,149 238,750 0 282,674
Chairman and Chief 1998 950,000 2,565,000 3,594 364,868 3,281,238 205,362
Executive Officer
The PNC Financial 1997 950,000 2,000,000 3,411 132,000 0 206,089
Services Group, Inc.
James E. Rohr 1999 754,615 1,808,800 3,338 95,000 0 197,807
President and Chief 1998 717,308 1,174,500 3,928 135,114 2,079,589 154,137
Operating Officer
The PNC Financial 1997 675,000 877,500 3,387 71,500 0 152,533
Services Group, Inc.
Walter E. Gregg, Jr. 1999 593,846 1,326,000 0 63,650 0 143,577
Vice Chairman 1998 552,308 831,600 1,260 53,400 1,564,596 112,476
The PNC Financial 1997 510,000 596,700 1,260 53,400 0 106,147
Services Group, Inc.
Joseph C. Guyaux 1999 342,307 511,000 0 64,461 0 41,874
Chief Executive Officer, 1998 296,923 341,000 1,602 32,135 0 25,277
PNC Regional Community
Bank and
Executive Vice President 1997 **
The PNC Financial
Services Group, Inc.
Thomas K. Whitford 1999 302,308 427,800 0 48,771 0 37,213
Chief Executive Officer, 1998 260,000 320,000 0 26,986 0 21,050
PNC Advisors and
Executive Vice President 1997 **
The PNC Financial
Services Group, Inc.
</TABLE>
- ----
* Footnotes to the Summary Compensation Table are set forth on page 17.
** Messrs. Guyaux and Whitford were not executive officers of the Corporation
during 1997 for purposes of the SEC's executive compensation disclosure
rules.
16
<PAGE>
Footnotes to Summary Compensation Table
(a) The amounts shown represent reimbursement for certain tax liabilities.
None of the named executive officers received perquisites or other
personal benefits, securities or property during 1999 which, in the
aggregate, cost the Corporation the lesser of $50,000 or 10% of the named
executive officer's salary and bonus earned during that year. Perquisites
and other personal benefits that were received by the named executive
officers were valued on the basis of their incremental cost to the
Corporation and its subsidiaries, as prescribed by the rules of the SEC.
(b) With respect to Messrs. Guyaux and Whitford, the number shown in this
column includes both shares of Common Stock underlying nonstatutory stock
options granted by the Personnel and Compensation Committee in its
discretion during 1999 and shares underlying reload options automatically
granted upon the officer's exercise during 1999 of options granted on
February 19, 1997. The number of shares of Common Stock underlying reload
options are shown in parentheses for Messrs. Guyaux (7,461) and Whitford
(6,021). For more information about reload options, please see the
"Individual Option Grants--1999" table on page 18 and the relevant
footnotes.
(c) The amount shown for Messrs. O'Brien, Rohr, Gregg and Guyaux for 1999
includes the dollar value ($9,600) of matching contributions of the
Corporation's Common Stock made pursuant to the Corporation's Incentive
Savings Plan, a qualified employee benefit defined contribution plan; in
the case of Mr. Whitford, the dollar value of such matching contributions
was $4,546. The amount also includes 1999 contributions made to the
Corporation's Supplemental Incentive Savings Plan, a non-qualified excess
defined contribution plan, for Messrs. O'Brien ($126,888), Rohr ($70,912),
Gregg ($50,979), Guyaux ($21,168), and Whitford ($23,192). Finally, the
amount shown includes the 1999 net premiums paid by the Corporation in
connection with its Key Executive Equity Plan, a split-dollar insurance
arrangement, on behalf of Messrs. O'Brien ($146,186), Rohr ($117,295),
Gregg ($82,998), Guyaux ($11,106), and Whitford ($9,475). The net premiums
disclosed in the preceding sentence, and included in "All Other
Compensation" for 1997 and 1998, represent the full dollar amounts paid by
the Corporation for both the term and non-term portions of the Key
Executive Equity Plan.
(d) As of December 31, 1999, the named executive officers held restricted
shares of Common Stock as follows, with the aggregate dollar value shown
as of that date: Messrs. O'Brien (81,000 shares; $3,622,223); Rohr (41,625
shares; $1,861,420); Gregg (30,375 shares; $1,358,334); Guyaux (13,500
shares; $603,704); and Whitford (7,875 shares; $352,161). The per share
dollar amount used to calculate these values is $44.7188, the average of
the high and low sale prices of a share of the Corporation's Common Stock
on the New York Stock Exchange on December 31, 1999.
17
<PAGE>
Option Grants in 1999
This table provides information on stock options granted to the named
executive officers in 1999. Only nonstatutory stock options were granted in
1999 under the Corporation's 1997 Long-Term Incentive Award Plan.
The table provides information about two categories of options granted
during 1999: (i) options granted to each of the named executive officers at
the discretion of the Personnel and Compensation Committee; and (ii) reload
options automatically granted to Messrs. Guyaux and Whitford upon their
exercise, in the required manner, of options granted to them by the Personnel
and Compensation Committee on February 19, 1997. Reload options included in
the following table are marked with the symbol "(R)." Information about the
nature and purpose of reload options is included in footnote (b); where
appropriate, other footnotes provide additional information which is specific
to the reload options shown in the table.
Individual Option Grants--1999
<TABLE>
<CAPTION>
Number of % of Total
Securities Options
Underlying Granted to Grant Date
Options Employees Exercise or Base Expiration Present
Name Granted (#) in 1999 Price ($/Sh) Date Value ($)
- ---- ----------- ---------- ---------------- ---------- ----------
(a)(b) (c) (d) (e)
<S> <C> <C> <C> <C> <C>
Thomas H. O'Brien 82,000 2.29% $76.0000 01/29/2009 343,131
Thomas H. O'Brien 156,750 4.37% $50.4687 02/17/2009 1,581,057
James E. Rohr 95,000 2.65% $50.4687 02/17/2009 958,217
Walter E. Gregg, Jr. 63,650 1.78% $50.4687 02/17/2009 642,005
Joseph C. Guyaux 57,000 1.59% $50.4687 02/17/2009 574,930
Joseph C. Guyaux 3,218(R) 0.09% $57.3125 02/19/2007 37,613
Joseph C. Guyaux 4,243(R) 0.12% $52.2500 02/19/2007 47,711
Thomas K. Whitford 42,750 1.19% $50.4687 02/17/2009 431,197
Thomas K. Whitford 3,049(R) 0.09% $56.5313 02/19/2007 35,607
Thomas K. Whitford 2,972(R) 0.08% $60.0937 02/19/2007 38,738
</TABLE>
- --------
(a) All options granted by the Personnel and Compensation Committee have a
grant date of February 17, 1999, except for the Committee's grant of
82,000 premium-priced options to Mr. O'Brien on January 29, 1999. The
options granted on February 17, 1999 become exercisable in three equal
annual installments, beginning one year after the grant date. The options
granted to Mr. O'Brien on January 29, 1999 became exercisable on July 29,
1999.
The reload options shown were automatically granted on the exercise
date(s) of the named executive officers' February 19, 1997 options, which
became exercisable on February 19, 1998. The grant dates for the reload
options are as follows: (i) Mr. Guyaux's 3,218 reload options were granted
on March 23, 1999 and his 4,243 reload options were granted on September
27, 1999; and (ii) Mr. Whitford's 3,049 reload options were granted on May
17, 1999 and his 2,972 reload options were granted on November 17, 1999.
All reload options become exercisable one year after their grant date.
(b) Nonstatutory stock options with a "reload" feature were first granted to a
select group of senior officers by the Personnel and Compensation
Committee on February 19, 1997. Except for the 82,000 premium-priced
options granted to Mr. O'Brien on January 29, 1999, all options granted to
the named executive officers and selected other senior officers by the
Committee during 1999 also have a reload feature. If options with a reload
feature are exercised using Common Stock which has been held for at least
six months, the options exercised are automatically replaced or "reloaded"
with a new, at-the-market option for each share of Common Stock used to
satisfy the exercise price and meet any associated tax withholding
obligation. Options can be reloaded only once, so that the reload options
shown in the table cannot be replaced when they are exercised. The reload
option will have the same remaining term as the option that was exercised.
The reload option feature advances the Corporation's goal of increased
Common Stock ownership by senior executives because it encourages the
early exercise of stock options and the retention of the shares received
upon exercise.
18
<PAGE>
(c) The exercise price shown equals the average of the high and low sale
prices of the Corporation's Common Stock on the New York Stock Exchange on
the date of the grant, except for the premium-priced options granted to
Mr. O'Brien on January 29, 1999. The $76.00 exercise price for those
options is above the exercise price which would have otherwise applied to
options granted on that date, or $50.69.
(d) The date shown in this column is the applicable ten-year expiration date,
but an option may expire prior to that date under certain circumstances
specified in the governing nonstatutory stock option agreement, such as
death, retirement, disability or termination of employment. The options
granted to Mr. O'Brien on February 17, 1999 will continue to vest in their
normal course following his retirement as Chief Executive Officer of the
Corporation on May 1, 2000. The exercisability of those options and
options previously granted to Mr. O'Brien in 1999 and 1998 will not be
affected by his retirement.
The expiration date shown for reload options coincides with the expiration
date of the option exercised, regardless of the reload option's grant
date. In other words, a reload option received upon the exercise of an
option granted on February 17, 1999 would have the same ten-year
expiration date of February 17, 2009 applicable to the original option,
regardless of the date on which the reload option was granted.
(e) The dollar values listed in this column are based upon the Black-Scholes
option pricing model.
Except for the 82,000 premium-priced options granted to Mr. O'Brien, the
options granted in 1999 to the named executive officers at the discretion
of the Personnel and Compensation Committee [i.e., the options shown in
the table that are not marked by the symbol "(R)"] and to certain other
executive officers include a reload feature. Those options were valued
without regard to the reload feature. The grant of a reload option is
treated for purposes of this table as the automatic grant of a new option,
the value of which is determined on its own terms as of its grant date.
Additional information about reload options is contained in footnote (b).
The chart below shows, by option grant date, the assumptions used to
determine the grant date present value per option. The dollar values shown
in the Individual Option Grants table in the column captioned "Grant Date
Present Value ($)" were calculated by carrying out the dollar value of
each option to four decimal places and rounding the result to the nearest
dollar. The Corporation in no way intends to provide any predictions or
assurances with respect to option or Common Stock values, as some of the
underlying assumptions are highly subjective. The grant dates for specific
options listed in the Individual Option Grants table are disclosed in
footnote (a).
<TABLE>
<CAPTION>
Annualized Estimated Dollar
Grant Market Exercise Risk Free Useful Dividend Value of
Date Price Price Volatility Rate of Return Life Yield Option
----- ------ -------- ---------- -------------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
01/29/99 $50.69 $76.00 0.225 4.73% 6 Years 3.60% $ 4.18
02/17/99 $50.47 $50.47 0.225 5.12% 6 Years 3.60% $10.09
03/23/99 $57.31 $57.31 0.225 5.34% 6 Years 3.60% $11.69
05/17/99 $56.53 $56.53 0.217 5.75% 6 Years 3.60% $11.68
09/27/99 $52.25 $52.25 0.217 6.22% 6 Years 3.60% $11.24
11/17/99 $60.09 $60.09 0.218 6.23% 6 Years 3.60% $13.03
</TABLE>
19
<PAGE>
Aggregated Option Exercises in 1999 and 1999 Year-End Option Values
This table provides information concerning exercises of nonstatutory stock
options during 1999 by the named executive officers. The table also shows the
number and value of unexercised options, including any reload options held by
the named executive officer, at the end of 1999.
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised
Options at 1999 In-the-Money Options
Year End (#) at 1999 Year End (a)
------------------------- -------------------------
Shares
Acquired on Value
Name Exercise (#) Realized Exercisable Unexercisable Exercisable Unexercisable
- ---- ------------ ---------- ----------- ------------- ----------- -------------
(b) (b)
<S> <C> <C> <C> <C> <C> <C>
Thomas H. O'Brien 132,000 $3,679,500 446,868 156,750 $ 0 $ 0
James E. Rohr 74,000 $2,365,688 336,614 95,000 $3,470,401 $0
Walter E. Gregg, Jr. 0 $ 0 151,800 63,650 $ 663,455 $0
Joseph C. Guyaux 20,600 $ 492,125 67,535 64,461 $ 475,383 $0
Thomas K. Whitford 18,843 $ 455,728 41,686 48,771 $ 263,260 $0
</TABLE>
- --------
(a) An option is in-the-money if the fair market value of the underlying
security exceeds the exercise price of the option.
(b) The dollar values shown were calculated by determining the difference
between: (i) the average of the high and low sale prices of the
Corporation's Common Stock on the New York Stock Exchange on December 31,
1999 (i.e., $44.7188); and (ii) the exercise prices of the various options
held by the named executive officer as of December 31, 1999. The value of
an option is deemed to be "$0" if its exercise price is greater than
$44.7188.
Pension Benefits
The Corporation maintains a non-contributory pension plan ("Pension Plan" or
"Plan") for qualifying employees. The Plan is a defined benefit pension plan
under the Employee Retirement Income Security Act of 1974, as amended and is
qualified under Section 401(a) of the Code. The Corporation and certain of its
subsidiaries contribute an actuarially determined amount necessary to fund the
total benefits payable to participants employed by them. The amount of the
Corporation's annual contribution with respect to a specific participant
cannot be readily calculated by the actuaries for the Pension Plan.
Benefits under the Plan are determined as follows: Effective January 1,
1999, a recordkeeping "account" was established for each participant. The
initial account balance was determined as the present value of each
participant's accrued benefit as of December 31, 1998, using the Plan
provisions in effect on December 31, 1998. For each calendar quarter after
January 1, 1999, eligible participants receive contribution credits, expressed
as a percentage of Covered Earnings, in accordance with a schedule based on
the participant's age plus years of credited service. In addition, employees
who were at least age 40 and had at least 10 years of credited service as of
January 1, 1999 will receive additional quarterly "Transitional Credits" for
up to 10 years.
"Covered Earnings" is defined as an employee's regular earnings plus
eligible paid bonuses; deferred bonus payments are applied to the
Corporation's Supplemental Pension Plan, discussed below. Eligible bonuses for
employees are limited to the greater of $25,000 or 50% of the employee's total
eligible bonuses for the calendar year.
Participants also receive quarterly interest credits at the prevailing 30-
year U.S. Treasury Bond rate. The benefit provided to participants in the
Pension Plan as of December 31, 1998 was no less than the benefit they had
accrued as of December 31, 1998, under the Plan rules in effect as of that
date.
The Corporation also maintains two supplemental non-qualified pension plans.
The Supplemental Pension Plan provides retirement benefits equal to the
difference, if any, between the maximum benefit allowed under the
20
<PAGE>
Code and the amount that would be provided by the Pension Plan if no limits
were applied. The Supplemental Pension Plan also recognizes deferred bonuses
that were not included in the Pension Plan as Covered Earnings.
The Corporation also maintains a separate supplemental benefit plan
applicable to certain officers of the Corporation and its subsidiaries.
Officers who were age 50 and had five years of vesting service as of January
1, 1999 receive benefits based on the formula in effect prior to January 1,
1999. All other officers participating in this plan will receive a benefit
based upon the cash balance formula described above, applied to the bonuses
that are recognized for contribution purposes.
The estimated total annual benefits (including those payable by both
supplemental non-qualified pension plans) payable upon retirement at the
normal retirement age of 65 for each of the named executive officers other
than Mr. O'Brien are as follows: Messrs. Rohr ($1,657,742); Gregg ($896,438);
Guyaux ($631,772); and Whitford ($579,346). The benefits have been projected
assuming that: (a) each named executive officer's salary remains constant
until retirement; and (b) the 30-year U.S. Treasury Bond rate until retirement
is 7.0%. In the case of Mr. O'Brien, who will be retiring as the Corporation's
Chief Executive Officer as of May 1, 2000, it is expected that his total
annual benefit will be $1,948,104. The amounts shown are based on the payment
method which would result in the highest annual benefit, if selected by the
named executive officer.
21
<PAGE>
COMMON STOCK PERFORMANCE GRAPH
The graph set forth below shows the cumulative total shareholder return
(i.e., price change plus reinvestment of dividends) on the Corporation's Common
Stock during the five-year period ended December 31, 1999, as compared with:
(i) an overall stock market index, the S&P 500 Index; (ii) a published industry
index, the S&P Major Regional Banks Index ("S&P Banks"); and (iii) a selected
peer group of the Corporation's competitors approved annually by the Personnel
and Compensation Committee of the Board ("Peer Group"+). The yearly points
marked on the horizontal axis of the graph correspond to December 31 of that
year. The stock performance graph assumes that $100 was invested on January 1,
1995, for the five-year period and that any dividends were reinvested. The
table below the graph shows the resultant compound annual growth rate ("CGR")
for the performance period.
[LINE GRAPH]
<TABLE>
<CAPTION>
5 Year
1994 1995 1996 1997 1998 1999 CGR
<S> <C> <C> <C> <C> <C> <C> <C>
PNC $100 $161.44 $197.06 $308.65 $301.45 $256.05 20.7%
Peer Group $100 151.72 201.16 308.65 324.05 253.78 20.5%
S&P 500 Index $100 137.58 169.17 225.60 290.08 351.12 28.6%
S&P Banks $100 157.46 215.15 323.51 357.44 306.69 25.1%
</TABLE>
+ The 1999 Peer Group comprises the following companies: Bank of America
Corporation; The Bank of New York Company, Inc.; Bank One Corporation; First
Union Corporation; Fleet Boston Corporation; KeyCorp; Mellon Financial
Corporation; National City Corporation; PNC; SunTrust Banks, Inc.; U.S.
Bancorp; Wachovia Corporation; and Wells Fargo & Company. Each yearly point
for the Peer Group is determined by calculating the cumulative total
shareholder return for each company in the Peer Group from January 1, 1995 to
December 31 of that year and then using the median of these returns as the
yearly plot point.
Assumes $100 investment on January 1, 1995
Total Return = Price change plus reinvestment of dividends
In accordance with the rules of the SEC, this section, captioned "Common
Stock Performance Graph", shall not be incorporated by reference into any of
the Corporation's future filings under the Securities Exchange Act of 1934 or
the Securities Act of 1933 and shall not be deemed to be soliciting material or
to be filed under the Securities Exchange Act of 1934 or the Securities Act of
1933.
22
<PAGE>
TRANSACTIONS INVOLVING DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS
Certain directors, nominees and/or their associates were customers of and
had transactions with the Corporation or its subsidiaries ("Company") during
1999. Transactions which involved loans or commitments by subsidiary banks
were made in the ordinary course of business and on substantially the same
terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons and did not involve more
than normal risk of collectibility or present other unfavorable features.
Since the beginning of 1999, the Corporation has advanced expenses in the
net amount of approximately $206,700 on behalf of Thomas H. O'Brien, Chairman
and Chief Executive Officer of the Corporation, in connection with legal
proceedings and claims against him on account of his service as a former
trustee of Allegheny Health Education and Research Foundation, a non-profit
entity which with certain affiliates was a customer of the Company. The
Corporation expects to advance additional amounts in the future.
Blank Rome Comisky & McCauley LLP, the law firm for which Mr. Girard-diCarlo
serves as Co-Chairman and Managing Partner, provided legal services to the
Company during 1999 and is providing similar services during 2000.
VOTING PROCEDURES
Pennsylvania law and the Corporation's By-Laws require the presence of a
quorum to transact business at the annual meeting. A quorum is constituted by
the presence, in person or by proxy, of shareholders entitled to cast at least
a majority of the votes which all shareholders are entitled to cast on the
particular matters to be voted on. Votes withheld from director nominees and
abstentions will be counted in determining whether a quorum has been reached.
Assuming a quorum has been reached, a determination must be made as to the
results of the vote on Item 1, the election of directors.
Under Pennsylvania law, the act of "voting" does not include either
recording the fact of abstention or failing to vote for a candidate or for
approval or disapproval of a proposal, whether or not the person entitled to
vote characterizes the conduct as voting. In other words, only those who
indicate an affirmative or negative decision on a matter are treated as
voting, so that ordinarily abstention or a mere absence or failure to vote is
not equivalent to a negative decision. A broker-dealer non-vote occurs when a
nominee holding shares for a beneficial owner does not vote on a particular
proposal because the nominee does not have discretionary voting power for that
particular item and has not received instructions from the beneficial owner.
With respect to Item 1, the 17 nominees for election as directors who
receive the greatest number of votes cast at the annual meeting, assuming that
a quorum is present, shall be elected as directors at the conclusion of the
vote tabulation. A withheld vote on any nominee will not affect the voting
results.
The Corporation has adopted a policy that all proxies, ballots, voting
instructions from employee benefit plan participants and voting tabulations
that identify the particular vote of a shareholder or benefit plan participant
be kept permanently confidential and not be disclosed to the Corporation, its
directors, officers or employees except: (i) as necessary to meet legal
requirements or to pursue or defend legal actions; (ii) to allow the Judge of
Election to certify the results of the vote; (iii) when expressly requested by
a shareholder or benefit plan participant; or (iv) in the event of a contested
proxy solicitation. The Corporation has confirmed with its independent vote
tabulator and Judge of Election that its procedures will be consistent with
the foregoing policy.
INDEPENDENT AUDITORS
At its meeting on February 17, 2000, the Board of Directors approved the
recommendation of the Audit Committee for the appointment of Ernst & Young LLP
to audit the consolidated financial statements of the Corporation for 2000.
Ernst & Young LLP performed audit services for the Corporation during 1999.
Such services included an audit of annual consolidated financial statements,
interim reviews of quarterly financial statements, review and consultation
connected with certain filings with the SEC, internal control reviews required
by regulatory authorities and certain contractual agreements, consultation on
tax, financial accounting and reporting matters, and meetings with the Audit
Committee of the Board of Directors.
23
<PAGE>
Representatives of Ernst & Young LLP are expected to be present at the
annual meeting with the opportunity to make a statement if they desire to do
so and to be available to respond to appropriate questions.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors, its executive officers, and persons who own more than
ten percent of a registered class of the Corporation's equity securities
(currently there are no such shareholders), to file with the Corporation, the
SEC and the New York Stock Exchange initial reports of ownership and reports
of changes in ownership of any equity securities of the Corporation. With
respect to 1999, to the best of the Corporation's knowledge, all required
report forms were filed on a timely basis. In making these statements, the
Corporation has relied in part on the written representations of its directors
and certain of its executive officers and copies of the reports provided to
the Corporation.
SHAREHOLDER PROPOSALS AND NOMINATIONS
Eligible shareholders may submit proposals to be considered for inclusion in
the Corporation's 2001 proxy materials for the 2001 annual meeting of
shareholders if they do so in accordance with the applicable SEC rules. Any
such proposals must be in writing and received by the Corporate Secretary at
the principal executive offices of the Corporation no later than November 17,
2000, in order to be considered for inclusion in the Corporation's 2001 proxy
materials.
For information on how to submit the name of a person to be considered by
the Committee on Corporate Governance for possible nomination as a director,
please see the paragraph discussing the Committee's responsibilities on page
4.
Director nominations and proposals for action at an annual meeting of
shareholders may be made only: (i) pursuant to the Corporation's notice of
such meeting; (ii) by the presiding officer; (iii) by or at the direction of a
majority of the Board of Directors; or (iv) by one or more shareholders in
accordance with the applicable rules of the SEC and the governing By-Law
provisions.
A shareholder may make a nomination for the election of a director or a
proposal for action at an annual meeting only if written notice is received by
the Corporate Secretary not later than (i) 90 days prior to the annual meeting
(which, for the 2001 annual meeting, would mean no later than January 24, 2001
if the annual meeting is held on April 24, 2001, unless a different date for
such notice has been stated in the Corporation's most recent proxy materials
distributed to shareholders); or (ii) if the annual meeting is to be held on a
date other than the fourth Tuesday in April, the close of business on the
tenth day following the first public disclosure of the meeting date. Public
disclosure of the date of any annual meeting may be made in a filing with the
SEC, in any notice given to the New York Stock Exchange or in a news release
reported by any national news service.
Each shareholder notice shall include: (i) as to the shareholder giving the
notice and the beneficial owner, if any, on whose behalf the notice is given
(A) the name and address of such shareholder and of such beneficial owner, and
(B) the class and number of shares of the stock of the Corporation that are
owned of record and beneficially by such shareholder and such beneficial
owner; and (ii) a representation that the shareholder is a beneficial owner of
stock of the Corporation entitled to vote at such meeting and intends to be
present at the meeting in person or by proxy to make such nomination or
proposal.
Each notice of nomination for the election of a director from a shareholder
also shall set forth: (i) the name and address of the person to be nominated;
(ii) a description of all arrangements or understandings between the
shareholder and the nominee and any other person or persons (naming such
person or persons) pursuant to which the nomination is to be made by the
shareholder; (iii) such other information regarding the nominee as would be
required to be included in proxy materials filed under the applicable rules of
the SEC had the nominee been nominated by the Board of Directors; and (iv) the
written consent of the nominee to serve as a director of the Corporation, if
so elected.
24
<PAGE>
Each notice of a proposal for action at an annual meeting from a shareholder
also shall set forth a brief description of the proposal, the reasons for
making such proposal, and any direct or indirect interest of the shareholder,
or any person on whose behalf the shareholder is acting, in making such
proposal.
If the Corporate Secretary receives notice of a shareholder proposal that
complies with the governing By-Law provisions on or prior to the required date
and if such proposal is properly presented at the 2001 annual meeting of
shareholders, the proxies appointed by the Corporation may exercise
discretionary authority in voting on such proposal if, in the Corporation's
proxy statement for such meeting, the Corporation advises shareholders of the
nature of such proposal and how the proxies appointed by the Corporation
intend to vote on such proposal, unless the shareholder submitting the
proposal satisfies certain SEC requirements, including the mailing of a
separate proxy statement to the Corporation's shareholders.
The presiding officer of the meeting may refuse to permit any nomination for
the election of a director or proposal to be made at an annual meeting by a
shareholder who has not complied with all of the governing By-Law procedures,
including receipt of the required notice by the Corporate Secretary by the
date specified. If a shareholder proposal is received by the Corporation after
the required notice date but the presiding officer of the meeting nevertheless
permits such proposal to be made at the 2001 annual meeting of shareholders,
the proxies appointed by the Corporation may exercise discretionary authority
when voting on such proposal.
Questions about these requirements, or notices mandated by them, may be
directed to:
Corporate Secretary
The PNC Financial Services Group
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
OTHER MATTERS
The Board of Directors knows of no other business to be presented at the
meeting. If, however, any other business should properly come before the
meeting, or any adjournment thereof, it is intended that the proxy will be
voted with respect thereto in accordance with the best judgment of the persons
named in the proxy.
By Order of the Board of Directors,
/s/ Thomas R. Moore
Thomas R. Moore
Corporate Secretary
25
<PAGE>
The PNC Financial Services Group, Inc.
This Proxy Is Solicited by the Board of Directors for Use at the
Annual Meeting of Shareholders
April 25, 2000--11:00 AM
Place: One PNC Plaza, Pittsburgh, PA
Thomas H. O'Brien, Walter E. Gregg, Jr. and Thomas R. Moore, and each of them
with full power to act alone and with full power of substitution, are hereby
authorized to represent the shareholder named on the reverse side hereof
("shareholder") at the annual meeting of shareholders of The PNC Financial
Services Group, Inc. to be held on April 25, 2000, or at any adjournment
thereof, and to vote, as indicated on the reverse side hereof, the number of
shares of Common Stock and/or Preferred Stock which the shareholder would be
entitled to vote if personally present at said meeting. The above named
individuals, and each of them with full power to act alone, are further
authorized to vote such stock upon any other business as may properly come
before the meeting, or any adjournment thereof, in accordance with their best
judgment.
THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE TIME VOTING IS DECLARED
CLOSED BY GIVING THE SECRETARY OF THE MEETING WRITTEN NOTICE OF REVOCATION OR A
SUBSEQUENTLY DATED PROXY, OR BY CASTING A BALLOT AT THE MEETING.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE.
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY.
- --------------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH HERE /\
<PAGE>
WILL ATTEND MEETING [ ]
The Board of Directors recommends a vote FOR all
nominees listed in Item 1. All shares will be voted as
instructed below. In the absence of an instruction to
the contrary, all shares will be voted FOR all nominees
listed in Item 1.
FOR WITHHELD
ALL FOR
NOMINEES ALL
[ ] [ ]
Item 1--Election of
Directors: Ms. Pepper
and Messrs. Chellgren,
Clay, Corcoran,
Davidson, Girard-
diCarlo, Gregg,
Johnson, Lindsay,
McClelland, O'Brien,
Randolph, Rohr, Ross,
Usher, Washington and
Wehmeier (or any
substitute nominee in
case of
unavailability).
FOR ALL NOMINEES, EXCEPT
AS INDICATED BELOW:
------------------------
(Write nominee name(s)
in the space provided COMMENTS/ADDRESS [ ]
above to withhold CHANGE Please
authority.) mark this box
if you have
written
comments/address
change on the
reverse side.
Signature(s)
----------------------------------------------- Date:
------------
Please sign as name appears hereon. Joint owners should each sign. When
signing on behalf of a corporation or partnership or as attorney, executor,
administrator, trustee or guardian, please give full title as such.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\FOLD AND DETACH PROXY CARD HERE/\
RETURN PROXY CARD IN ENCLOSED ENVELOPE AFTER COMPLETING, SIGNING AND DATING
Admission Ticket
THE PNC FINANCIAL SERVICES GROUP, INC.
2000 Annual Meeting of Shareholders
Tuesday, April 25, 2000 11:00 AM One PNC Plaza -- 15th Floor Fifth Avenue and
Wood Street Pittsburgh, Pennsylvania
PLEASE ADMIT Non-Transferable
<PAGE>
THE PNC FINANCIAL SERVICES GROUP, INC.
Annual Meeting of Shareholders
April 25, 2000--11:00 AM
Place: One PNC Plaza, Pittsburgh, PA
ISP INSTRUCTION CARD
To: PNC Bank, National Association, Trustee of the non-ESOP portion of The PNC
Financial Services Group, Inc. Incentive Savings Plan and Trustee of the ESOP
portion of The PNC Financial Services Group, Inc. Incentive Savings Plan.
The signatory on the reverse side hereof, a Participant having Common Stock
and/or Preferred Stock of The PNC Financial Services Group, Inc. credited to my
account, does hereby direct each Trustee to vote the number of shares indicated
hereon at the annual meeting of shareholders to be held on April 25, 2000, or
any adjournment thereof, as indicated.
THIS CARD IS CONTINUED ON THE REVERSE SIDE. PLEASE SIGN ON THE REVERSE SIDE AND
RETURN PROMPTLY.
- --------------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH HERE /\
<PAGE>
WILL ATTEND MEETING [ ]
The Board of Directors recommends a vote FOR all
nominees listed in Item 1. All full and partial shares
of stock credited to your Plan account will be voted as
directed below. In the absence of a direction to the
contrary, all shares (including unallocated shares) will
be voted in the manner required or permitted by the
governing Plan documents.
FOR WITHHELD
ALL FOR
NOMINEES ALL
[ ] [ ]
Item 1--Election of
Directors: Ms. Pepper
and Messrs. Chellgren,
Clay, Corcoran,
Davidson, Girard-
diCarlo, Gregg, Johnson,
Lindsay, McClelland,
O'Brien, Randolph, Rohr,
Ross, Usher, Washington
and Wehmeier (or any
substitute nominee in
case of unavailability).
FOR ALL NOMINEES, EXCEPT
AS INDICATED BELOW:
-------------------------
(Write nominee name(s)
in the space provided COMMENTS/ADDRESS [ ]
above to withhold CHANGE Please
authority.) mark this box
if you have
written
comments/address
change on the
reverse side.
Signature
------------------------------------------------ Date:
-------------
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH INSTRUCTION CARD HERE /\
RETURN INSTRUCTION CARD IN ENCLOSED
ENVELOPE AFTER COMPLETING, SIGNING AND DATING
Admission Ticket
THE PNC FINANCIAL SERVICES GROUP, INC.
2000 Annual Meeting of Shareholders
Tuesday, April 25, 2000 11:00 AM One PNC Plaza -- 15th Floor Fifth Avenue and
Wood Street Pittsburgh, Pennsylvania
PLEASE ADMIT Non-Transferable
<PAGE>
THE PNC FINANCIAL SERVICES GROUP, INC.
Annual Meeting of Shareholders
April 25, 2000--11:00 AM
Place: One PNC Plaza, Pittsburgh, PA
RSP INSTRUCTION CARD
To: PNC Bank, National Association, Trustee of the PNC Retirement Savings Plan.
The signatory on the reverse side hereof, a Participant having Common Stock of
The PNC Financial Services Group, Inc. credited to my account, does hereby
direct the Trustee to vote the number of shares indicated hereon at the annual
meeting of shareholders to be held on April 25, 2000, or any adjournment
thereof, as indicated.
THIS CARD IS CONTINUED ON THE REVERSE SIDE. PLEASE SIGN ON THE REVERSE SIDE AND
RETURN PROMPTLY.
- --------------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH HERE /\
<PAGE>
WILL ATTEND MEETING [ ]
The Board of Directors recommends a vote FOR all
nominees listed in Item 1. All full and partial shares
of stock credited to your Plan account will be voted as
directed below. In the absence of a direction to the
contrary, all shares (including unallocated shares)
will be voted in the manner required or permitted by
the governing Plan documents.
FOR WITHHELD
ALL FOR
NOMINEES ALL
[ ] [ ]
Item 1--Election of
Directors: Ms. Pepper
and Messrs. Chellgren,
Clay, Corcoran,
Davidson, Girard-
diCarlo, Gregg,
Johnson, Lindsay,
McClelland, O'Brien,
Randolph, Rohr, Ross,
Usher, Washington and
Wehmeier (or any
substitute nominee in
case of
unavailability).
FOR ALL NOMINEES, EXCEPT
AS INDICATED BELOW:
------------------------
(Write nominee name(s)
in the space provided COMMENTS/ADDRESS [ ]
above to withhold CHANGE Please
authority.) mark this box
if you have
written
comments/address
change on the
reverse side.
Signature
----------------------------------------------- Date:
------------
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH INSTRUCTION CARD HERE /\
RETURN INSTRUCTION CARD IN ENCLOSED ENVELOPE AFTER COMPLETING, SIGNING AND
DATING
Admission Ticket
The PNC Financial Services Group, Inc.
2000 Annual Meeting of Shareholders
Tuesday, April 25, 2000 11:00 AM One PNC Plaza -- 15th Floor Fifth Avenue and
Wood Street Pittsburgh, Pennsylvania
PLEASE ADMIT Non-Transferable
