<PAGE> 1
PIONEER AMERICAN HOLDING COMPANY CORP.
---------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO OUR SHAREHOLDERS:
Notice is hereby given that the annual meeting of shareholders of PIONEER
AMERICAN HOLDING COMPANY CORP. (the "Company") will be held on June 6, 1995, at
10:00 A.M. (prevailing time), at the Corporate Office of Pioneer American
Holding Company Corp., 41 North Main Street, Carbondale, Pennsylvania for the
following purposes:
1. To elect the three Class 2 Directors named herein to serve as
Directors of the Company, as more fully described in the accompanying
Proxy Statement; and
2. To transact such other business as may properly come before this
meeting or any postponement or adjournment thereof.
The Board of Directors has fixed March 31, 1995 as the record date for the
determination of shareholders entitled to vote at the annual meeting. Only
shareholders of record at the close of business on that date will be entitled to
notice of, and to vote at, the annual meeting.
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN PERSON. WHETHER
OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE URGED TO SIGN,
DATE AND PROMPTLY RETURN THE ENCLOSED PROXY. A SELF-ADDRESSED ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE; NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES.
By Order of the Board of Directors,
/s/ DONALD A. HOYLE, JR.
-----------------------------------
Donald A. Hoyle, Jr., President
May 12, 1995
<PAGE> 2
PIONEER AMERICAN HOLDING COMPANY CORP.
41 North Main Street
Carbondale, Pennsylvania 18407
----------------------------
PROXY STATEMENT
----------------------------
The accompanying proxy is solicited by and on behalf of the Board of
Directors of Pioneer American Holding Company Corp. (the "Company") for use at
the annual meeting of shareholders to be held on June 6, 1995, at 10:00 A.M.
(prevailing time) at the Company's Corporate Office, 41 North Main Street,
Carbondale, Pennsylvania and at any postponement or adjournment thereof. The
approximate date on which this Proxy Statement and the accompanying form of
proxy will first be sent or given to shareholders is May 12, 1995.
Sending in a signed proxy will not affect the shareholder's right to attend
the annual meeting and vote in person since the proxy is revocable. Any
shareholder giving a proxy has the power to revoke it by, among other methods,
giving written notice to the Secretary of the Company at any time before the
proxy is exercised.
The expense of the proxy solicitation will be borne by the Company. In
addition to solicitation by mail, proxies may be solicited in person or by
telephone, telegraph or teletype by directors, officers or employees of the
Company and its bank subsidiary, Pioneer American Bank, National Association
(the "Bank") without additional compensation. Upon request by record holders of
the Company's common stock, par value $10.00 per share (the "Common Stock"), who
are brokers, dealers, banks or voting trustees, or their nominees, the Company
is required to pay the reasonable expenses incurred by such record holders for
mailing proxy material and annual shareholder reports to any beneficial owners
of Common Stock.
A form of proxy is enclosed. If properly executed and received in time for
voting, and not revoked, the enclosed proxy will be voted as indicated in
accordance with the instructions thereon. If no directions to the contrary are
indicated, the persons named in the enclosed proxy will vote all shares of the
Company's Common Stock for election of the three nominees for Class 2
directorships hereinafter named.
The enclosed proxy confers discretionary authority to vote with respect to
any and all of the following matters that may come before the meeting: (i)
matters which the Company does not know, a reasonable time before the proxy
solicitation, are to be presented at the meeting; (ii) approval of the minutes
of a prior meeting of shareholders, if such approval does not amount to
ratification of the action taken at the meeting; (iii) the election of any
person to any office for which a bona fide nominee is unable to serve or for
good cause will not serve; (iv) any proposal omitted from this Proxy Statement
and form of proxy pursuant to Rules 14a-8 or 14a-9 under the Securities Exchange
Act of 1934, as amended; and (v) matters incident to the conduct of the meeting.
In connection with such matters, the persons named in the enclosed form of proxy
will vote in accordance with their best judgment.
<PAGE> 3
The Company is not currently aware of any matters which will be brought
before the annual meeting (other than procedural matters) which are not referred
to in the enclosed notice of the annual meeting.
The Company had 1,390,420 shares of Common Stock outstanding at the close
of business on March 31, 1995, the record date. 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 a particular matter constitutes a
quorum for the purpose of considering such matter. Each share of Common Stock
outstanding is entitled to one vote on each matter which may be brought before
the annual meeting. The election of Directors will be determined by a plurality
vote. An abstention, withholding of authority to vote or broker non-vote,
therefore, will not have the same legal effect as an "against" vote and will not
be counted in determining whether the proposal has received the required
shareholder vote.
Article 8 of the Company's Articles of Incorporation restricts the rights
of a Person (as hereafter defined) to cast more than 10% of the total votes
which all shareholders are entitled to cast at a meeting, unless authorized to
do so by the Board of Directors and subject to such conditions as the Board of
Directors may impose. The term "Person" includes not only individuals and
entities, but also groups of individuals and entities who act together for the
purpose of acquiring, holding, disposing of or voting Common Stock.
The casting of votes by a Person as a proxy holder for other shareholders
is not counted in computing the 10% limitation to the extent that the proxies so
voted were revocable and were secured from other shareholders who are not
members of a group which includes such Person. Giving a revocable proxy to a
Person does not in itself cause the shareholder giving the proxy to be a member
of a group which includes such Person. Article 8 provides that the determination
by the Board of Directors of the existence or membership of a group, and of a
number of votes any Person or each member of a group is entitled to cast, is
final and conclusive absent clear and convincing evidence of bad faith.
In the event of a violation of Article 8 and in addition to other remedies
afforded the Company, the judges of election cannot count votes cast in
violation of Article 8 and the Company or its nominees have an option to acquire
from the violator shares of Common Stock in excess of the 10% limit at prices
which would in certain situations be lower than the then current market prices
of such shares.
The foregoing is a brief summary of Article 8 and is qualified and
amplified in all respects by the exact provisions of the Articles of
Incorporation, which can be obtained in the same manner as the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1994 (see "ANNUAL
REPORT").
<PAGE> 4
PRINCIPAL BENEFICIAL OWNERS OF COMMON STOCK
The following table sets forth, as of March 31, 1995, certain information
with respect to the beneficial ownership of Common Stock by (i) each person who
owns of record or who is known by the Board of Directors to be the beneficial
owner of more than five percent of the outstanding Common Stock, (ii) each
Director, (iii) each of the Executive Officers named in the Summary Compensation
Table below and (iv) all Executive Officers and Directors of the Company as a
group:
<TABLE>
<CAPTION>
Shares of Common
Stock Beneficially Percent of
Name Position Owned (a) Class (b)
- - - - - ---- -------- ------------------ ----------
<S> <C> <C> <C>
Richard Chojnowski Director 73,228(c) 5.27%
Gene E. Goldenziel Director 28,998(d) 2.08%
John S. Guzey Chairman/Director 28,000 2.02%
Donald A. Hoyle, Jr. President/Director 47,560(e) 3.34%
William K. Nasser Director 76,754(f) 5.53%
One Dunham Drive
Dunmore, PA
Margaret O'Connor Director 22,508(g) 1.63%
John W. Reuther Senior Executive Vice 35,528(h) 2.51%
President/Director
Eldore Sebastianelli Treasurer/Director 23,646(i) 1.70%
John W. Walski Director 50,572(j) 3.64%
All Directors and Executive
Officers of the Company as
a group (13 persons) 391,337 27.06%
- - - - - ----------
</TABLE>
<PAGE> 5
(a) The securities "beneficially owned" by an individual are determined in
accordance with the definition of "beneficial ownership" set forth in the
regulations of the Securities and Exchange Commission and, accordingly, may
include securities owned by or for, among others, the wife and/or minor
children of the individual and any other relative who has the same home as
such individual, as well as other securities as to which the individual has
or shares voting or investment power or has the right to acquire within 60
days after March 31, 1995. Beneficial ownership may be disclaimed as to
certain of the securities. Except as indicated in the footnotes of this
table, the persons named in this table have sole voting and investment
power with respect to all shares of Common Stock indicated.
(b) Does not include shares held by the ESOP except as specifically set forth
herein. As of March 31, 1995, the ESOP held 75,938 shares of which 4,254
shares had not been allocated to individual accounts.
(c) All shares are owned jointly with his mother.
(d) Includes 24,498 shares owned jointly with his spouse and 2,000 shares held
in an IRA account and 2,000 shares held as co-trustee.
(e) Includes 33,000 shares which may be acquired upon the exercise of stock
options. Also includes 9,208 shares owned jointly with his spouse and
4,588 shares held by the ESOP which have been allocated to his individual
account.
(f) Includes 8,292 shares owned jointly with his spouse, 19,856 shares owned
individually by his spouse, 9,602 shares held by him as co-trustee for his
children, and 39,004 shares owned individually among his children and
grandchildren.
(g) Includes 100 shares owned by Estate of husband and 22,308 held as Trustee
for family trust.
(h) Includes 22,629 shares which may be acquired upon the exercise of stock
options. Also includes 32 shares held by him as co-trustee for his
children, 40 shares held jointly with his son, Michael, and 3,581 shares
held by the ESOP which have been allocated to his individual account.
(i) Includes 2,146 shares held as trustee for his granddaughters and 21,770
shares held jointly with his spouse.
(j) Includes 17,324 shares owned jointly with his spouse.
<PAGE> 6
ELECTION OF DIRECTORS
The Company's Bylaws provide that the Board of Directors will be divided
into four classes and that each class shall serve for four years. The Board of
Directors has designated the persons listed below to be nominees for election as
Class 2 Directors. The nominees are being nominated to serve until the end of
their terms and until their successors are elected and qualified. The Company
has no reason to believe that either of the nominees will be unavailable for
election; however, should either nominee become unavailable for any reason, the
Board of Directors may designate a substitute nominee. The proxy agents intend
(unless authority has been withheld) to vote for the election of the Company's
nominees.
The Bylaws of the Company require that nominations for Directors to be
elected at an annual meeting of shareholders, except for those made by
management of the Company, must be submitted to the Secretary of the Company in
writing not later than the close of business on the 20th day immediately
preceding the date of the meeting. Such notification shall contain the following
information to the extent known to the notifying shareholder: (a) name and
address of each proposed nominee; (b) the principal occupation of each proposed
nominee; (c) the total number of shares of capital stock of the Company that
will be voted for each proposed nominee; (d) the name and residence address of
the notifying shareholder; and (e) the number of shares of capital stock of the
Company owned by the notifying shareholder. Nominations not made in accordance
herewith may, in such officer's discretion, be disregarded by the presiding
officer of the meeting, and upon the presiding officer's instruction, the vote
talliers may disregard all votes cast for each such nominee. In the event the
same person is nominated by more than one shareholder, the nomination shall be
honored, and all shares of capital stock of the Company shall be counted if at
least one nomination for that person complies with this provision.
Every Director must be a shareholder of the Company and shall own in the
Director's right the number of shares (if any) required by law in order to
qualify as such Director. Any Director shall forthwith cease to be a Director
when the Director no longer holds such shares, which fact shall be reported to
the Board of Directors by the Secretary, whereupon the Board of Directors shall
declare the seat of such Director vacated.
<PAGE> 7
Information Concerning Nominees
The following table contains information with respect to the nominees for
Director. William K. Nasser and John W. Walski were first elected to the Board
of Directors upon formation of the Company in 1984. Gene E. Goldenziel was first
elected in 1986.
<TABLE>
<CAPTION>
Year First
Elected or
Appointed
Director of Principal Occupation
Name Age the Bank for Past Five Years
- - - - - ---- --- ----------- --------------------
<S> <C> <C> <C>
Class 2 - Term to Expire in 1999
Gene E. Goldenziel 47 1985 Attorney - Needle & Goldenziel
William K. Nasser 79 1969 Certified Public Accountant - William K.
Nasser Accountants
John W. Walski 73 1982 Retired - Giant Markets
</TABLE>
Information Concerning Continuing Directors
The following table contains certain information with respect to the
Directors whose terms of office expire in 1996, 1997 and 1998. John Reuther was
first elected in 1988, Vivian Needle was first elected in 1992 and Richard
Chojnowski and Margaret O'Connor were first appointed to the Board of Directors
in 1994 and 1995, respectively. All other Directors were first elected upon
formation of the Company in 1984.
<TABLE>
<CAPTION>
Year First
Elected or
Appointed
Director of Principal Occupation
Name Age the Bank for Past Five Years
- - - - - ---- --- ----------- --------------------
<S> <C> <C> <C>
Class 1 - Term to Expire in 1996
Donald A. Hoyle, Jr. 60 1984 President of Company and Bank
Richard Chojnowski 52 1994 Electrical Contractor
Class 3 - Term to Expire in 1998
John S. Guzey 87 1960 Retired President-Keystone Pavement
& Construction Co.
Margaret O'Connor 64 1995 Former Mayor, Clarks Summit
</TABLE>
<PAGE> 8
<TABLE>
<CAPTION>
Year First
Elected or
Appointed
Director of Principal Occupation
Name Age the Bank for Past Five Years
- - - - - ---- --- ----------- --------------------
<S> <C> <C> <C>
Class 4 - Term to Expire in 1997
John W. Reuther 45 1988 Senior Executive Vice President of
Company and Bank
Eldore Sebastianelli 74 1980 Co-owner - C&S Excavating Company
</TABLE>
Committees of the Board of Directors and Attendance at Meetings
The Company does not have any nominating committee of the Board of
Directors. Shareholders can submit to management names of nominees for Directors
for review and consideration by the entire Board of Directors, as described
above.
The Bank has an Audit Committee which consists of three directors of the
Bank who are not employees of the Bank and are appointed annually by the Board
of Directors of the Bank. William K. Nasser, Eldore Sebastianelli and John W.
Walski are presently members of this Committee. The Bank's Audit Committee met
two times during 1994 and is responsible for insuring that a suitable internal
control system is maintained and proper examination procedures are carried out
in all areas of the Bank on a continuing basis.
The Bank also has a Planning Committee which is appointed annually by the
Board of Directors of the Bank. Gene E. Goldenziel, Richard Chojnowski, Margaret
O'Connor and Robert S. Wallis are presently members of this Committee. The
Bank's Planning Committee met two times during 1994 and is responsible for
long-range planning for the Bank including recommending the compensation for
senior officers of the Bank.
The Board of Directors of the Company held five regular meetings during
1994. The Board of Directors of the Bank held 27 regular meetings during 1994.
All incumbent Directors of the Company attended at least 75% of the aggregate of
all the meetings of the Board of Directors and committee meetings of the Bank on
which such Directors serve, with the exception of John Walski, who resides in
Florida for four months.
<PAGE> 9
Board of Directors' Fees
Members of the Board of Directors are compensated at the rate of $200 per
meeting of the Company and $500 per meeting of the Bank attended and one half
the fee for meetings of the Bank not attended. Non-management Directors of the
Bank also received an additional fee of $8,000 during 1994.
EXECUTIVE COMPENSATION AND CERTAIN TRANSACTIONS
Executive Compensation
The following table sets forth all cash compensation paid by the Company
and the Bank for services rendered in all capacities to the Company and its
subsidiaries during the fiscal year ended December 31, 1994 to the Chief
Executive Officer of the Company and the Bank and to all Executive Officers of
the Company and the Bank whose salary and bonus exceed $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Name and Long-Term All Other
Principal Position Annual Compensation Compensation Compensation(a)
- - - - - ------------------ ------------------- ------------ ---------------
Year Salary (b) Bonus Stock Options
---- ---------- ----- -------------
<S> <C> <C> <C> <C> <C>
Donald A. Hoyle, Jr. 1994 $177,500 $35,200 16,000 $63,364
President of the Bank
and the Company 1993 161,100 29,300 16,000 60,519
1992 145,600 19,610 16,000 53,962
John W. Reuther, 1994 $132,200 $22,940 14,000 $45,123
Senior Executive Vice
President of the Bank 1993 121,300 21,340 14,000 28,671
and the Company
1992 109,400 14,400 14,000 23,103
</TABLE>
(a) For Mr. Hoyle, includes $13,664, $17,580 and $10,615 contributed by the
Company or the Bank on his behalf to the Employee Stock Ownership Plan,
$6,000, $7,089 and $6,498 contributed to the Savings and Investments Plan
and $43,700, $35,850 and $35,813 to pay insurance premiums to fund the
Company's obligations under the Executive Retirement Plan, in 1994, 1993 and
1992, respectively.
For Mr. Reuther, includes $10,846, $12,800 and $7,728 contributed by the
Company or the Bank on his behalf to the Employee Stock Ownership Plan,
$6,277, $5,793 and $5,298 contributed to the Savings and Investments Plan
and $28,000, $10,078 and $10,077 to pay insurance premiums to fund the
Company's obligations under the Executive Retirement Plan, in 1994, 1993 and
1992, respectively.
(b) Includes Directors fees.
<PAGE> 10
Employment Agreements
The Bank and the Company had entered into employment agreements with Donald
A. Hoyle, Jr. and John W. Reuther on September 30, 1991 providing for base
annual salaries of $121,000 and $89,000, respectively. On October 12, 1993, the
Bank entered into new employment agreements with Mr. Hoyle and Mr. Reuther
providing for base annual salaries of $146,500 and $106,700, respectively. Both
the new and old agreements provide for such higher than base salaries as may be
negotiated from time to time during the term of the agreements as well as
certain additional employment benefits. The base term of the agreements is five
years; the agreements may be terminated by the Bank for cause, upon the death of
the employee and, subject to the following provision concerning change of
control, upon the termination of the employee's employment by resignation or
otherwise. In the event that employee's employment with the Bank is terminated
by the employee or the Bank upon a change in control of the Bank, the Bank will
pay to the employee a lump-sum termination benefit equal to three years' base
annual salary not later than 30 days after termination. In addition, upon such
change in control, for one year, the employee will be reimbursed costs incurred
in connection with the search for a new job and reasonable relocation expenses
and, for two years, all nondiscriminatory employee benefits.
Executive Retirement Plan
On October 25, 1988, the Bank adopted a retirement plan (the "Executive
Retirement Plan") for the benefit of eligible employees. The Executive
Retirement Plan is administered by a committee of the Board which designates the
members who are eligible to participate in the Plan. The purpose of the
Executive Retirement Plan is to assist the Bank and the Company in retaining the
service of certain key employees until their retirement, to induce these key
employees to utilize their best efforts to maintain and enhance the business of
the Bank and the Company and to provide certain benefits to the key employees.
Under the Executive Retirement Plan, the Bank allocates each year an amount on
behalf of the member necessary to provide an annual income at the member's
normal retirement date payable for ten years equal to 35% of the member's
average compensation for his three most highly compensated years of employment.
While benefits under the Executive Retirement Plan are intended to be unfunded
obligations of the Bank, the Bank has elected to purchase insurance policies to
fund the obligations. The account of each member is credited with interest at
the rate of seven percent and compounded annually. A member shall have a 100%
vested interest in his account upon eligibility for retirement, death,
termination of his employment or in the event of a merger or acquisition of the
Bank by another entity. Upon retirement, the member is entitled to the value of
the account distributed in equal installments over a period of five, ten or
fifteen years at the election of the member. Prior to a member's retirement, a
member's beneficiary is entitled to the greater of the value of the member's
account at the time of death, or $200,000 or $250,000 as determined by the Board
of Directors. Donald A. Hoyle, Jr. and John W. Reuther have been designated as
members under the Executive Retirement Plan.
On March 7, 1994, the Bank supplemented the above described "Executive
Retirement Plan" with insurance contracts for the benefit of Donald A. Hoyle,
Jr. and John W. Reuther. The supplemental plan provides that the Bank purchase
life insurance policies on the lives of the named executives. The Bank will
further pay the annual premium due on each such policy until each insured
reaches the age of 65, unless employment is terminated prior to age 65. Each
named executive shall have a 100% ownership interest in his account upon
eligibility for retirement, death, termination of his employment or in the event
of a merger or acquisition of the Bank by another entity. Each named executive
has executed a split-dollar agreement granting a collateral interest to the Bank
for all premiums paid by the Bank, which collateral interest is extinguished
upon retirement, death, termination of employment or in the event of a merger or
acquisition of the Bank by another entity. At their retirement age of 65, the
plan benefit is estimated at $501,276 for Donald A. Hoyle, Jr. and $1,054,602
for John W. Reuther.
<PAGE> 11
Employee Stock Ownership Plan
The Board of Directors of the Bank adopted an Employee Stock Ownership Plan
("ESOP") effective January l, 1985, and restated effective January l, 1989. The
ESOP is intended to invest primarily in the Common Stock of the Company
("Qualifying Employer Securities"). The assets of the ESOP are held in a trust
fund by the Company, as trustee (the "Trustee"), pursuant to a trust agreement.
Contributions from the Bank to the ESOP are generally required to be made
from net profits, and are made in amounts established in the sole discretion of
the Board of Directors. Each participant is entitled to direct the Trustee with
respect to the voting rights, if any, of any Qualifying Employer Securities
allocated to the participant's account provided that the issuer has a
"registration-type" class of securities. In other cases, the voting of shares
held by the ESOP, in general, will be determined by the Trustee. In addition,
under certain circumstances, a participant (or beneficiary) may exercise a "put
option" granted by the ESOP and require the Company to buy back any Qualifying
Employer Securities distributed to the participant (or beneficiary).
The operation and administration of the ESOP is controlled by a committee
appointed by the Board of Directors. The committee presently consists of Donald
A. Hoyle, Jr., Patricia A. Cobb, Susan Muir and Nina Sticker. The committee
designates investment policies under which the Trustee acts. The Board of
Directors has the sole responsibility to appoint and remove members of the
committee or the Trustee, and for determining the amount of contributions to the
ESOP by the Bank, and to amend or terminate, in whole or in part, the ESOP or
the trust agreement.
Any employee of the Bank in the eligible class of employees is eligible to
become a participant in the ESOP as of the January 1st following the date the
employee completed six months of service with the Bank, and will share in
employer contributions to the ESOP if he has completed 1,000 hours of service in
any year. Each participant shall be fully vested in his account after three
years of service. Stock purchased by the ESOP and dividends received by the ESOP
are allocated among the participants in proportion to their respective
compensation. Upon retirement, death or disability, a participant or his
beneficiaries, as the case may be, will generally be entitled to receive
specified benefits in the form of a single-sum distribution, subject to
alternative forms of distribution. At the discretion of the Committee, benefits
will be distributed in cash or in shares of Common Stock subject to the right of
the participant to elect to receive his benefits in shares of Common Stock. A
participant who separates from service prior to attainment of normal retirement
age has the right to receive distribution of his plan benefits commencing no
later than five years after the plan year in which he separated from service.
<PAGE> 12
Savings and Investment Plan
The Bank sponsors a Savings and Investment Plan ("Savings Plan") for
employees which became effective on September 1, 1985, and was restated
effective January 1, 1989. Any employee who was employed by the Bank on
September 1, 1985 automatically became a participant in the Savings Plan. Any
employee who completes 1,000 hours of service in any year is also eligible to
participate in the Savings Plan.
Subject to certain limitations, participants may contribute a portion of
their earnings for each year to the Savings Plan. For the first three percent of
earnings contributed by a participant, the Bank matches the contribution. On the
next three percent of earnings contributed by a participant, the Bank matches
one-half of the contribution. In addition, the Bank may contribute such
additional amounts as it determines. Federal income taxes on the participant's
and the Bank's contributions to the Savings Plan are deferred until the
participant withdraws funds from the Savings Plan. Each participant designates
one or more investment funds for the investment of the contributions made on the
participant's behalf. A participant is 100% vested in his account upon death or
termination of employment for any reason. Upon termination of employment by, or
death of, a participant, the participant or his estate has several alternatives
available for withdrawing funds from the Savings Plan. Withdrawals by a
participant of certain contributions and loans from the Savings Plan are also
permitted in certain situations.
Stock Option Plan
In February 1990, the Board of Directors of the Company adopted a stock
option plan, which was approved by the shareholders of the Company in May 1990
(the "Stock Option Plan"). Pursuant to the Stock Option Plan, stock options may
be granted which qualify under the Internal Revenue Code as incentive stock
options as well as stock options that do not qualify as incentive options. All
officers and key employees of the Company or any current or future subsidiary
who are employed on a full-time basis are eligible to receive options under the
Stock Option Plan. As of December 31, 1994, incentive stock options covering an
aggregate of 81,000 shares had been granted pursuant to the Stock Option Plan at
a $16.00 per share exercise price, incentive stock options covering an aggregate
of 30,000 shares had been granted at a $18.00 per share exercise price,
incentive stock options covering an aggregate of 9,000 shares had been
granted at a $23.00 per share exercise price and incentive stock options
covering an aggregate of 30,000 shares were granted at $26.00 per share
exercise price.
The purpose of the Stock Option Plan is to provide additional incentive to
employees of the Company by encouraging them to invest in the Company's Common
Stock and thereby acquire a proprietary interest in the Company and an increased
personal interest in the Company's continued success and progress. The Stock
Option Plan is administered by a committee which is appointed by the Board of
Directors and consists only of Directors who are not eligible to receive options
under the Stock Option Plan. The committee determines, among other things, which
officers and key employees receive an option or options under the Stock Option
Plan, the type of option (incentive stock options or non-qualified stock
options, or both) to be granted, the number of shares subject to each option,
the rate of option exercisability, and, subject to certain other provisions to
be discussed below, the option price and duration of the option.
<PAGE> 13
The aggregate number of shares which may be issued upon the exercise of
options under the Stock Option Plan is 150,000 shares of Common Stock. The
option price for options issued under the Stock Option Plan is to be at least
equal to 100% of the fair market value of the Common Stock as of the date the
option is granted. The fair market value is determined by the committee.
Except as otherwise described below, none of the options granted under the
Stock Option Plan may be exercised during the first year after the date granted.
Thereafter each optionee may exercise up to 50% of his option the second year,
up to 75% of his option the third year, and up to 100% of his option thereafter.
In the event of a "change in control" of the Company, as defined in the Stock
Option Plan, each optionee may exercise the total number of shares then subject
to the option. Unless terminated earlier by the option's terms, incentive stock
options expire ten years after the date they are granted and non-qualified stock
options expire ten years and ten days after the date they are granted.
The following table sets forth the details of options granted to the
Executive Officers listed in the Summary Table during the fiscal year ended
December 31, 1994.
OPTION GRANTS TABLE
Option Grants in the fiscal year ended December 31, 1994
<TABLE>
<CAPTION>
Individual Grants
----------------------------------------------------------------------------
Percentage of
Total Options
Granted to
Name and Employees in Exercise Price
Principal Position Options Granted Fiscal Year Per Share Expiration Date
- - - - - ------------------ --------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
Donald A. Hoyle, Jr., 16,000 53.33% $26 February 24, 2004
President of the Bank
and the Company
John W. Reuther, 14,000 46.67% $26 February 24, 2004
Senior Executive Vice
President of the Bank
and the Company
</TABLE>
<PAGE> 14
The following table sets forth certain information concerning the shares
acquired upon exercise of options, the number of unexercised options and the
value of unexercised options at December 31, 1994 held by the Executive Officers
listed in the Summary Table.
OPTION EXERCISES AND YEAR-END VALUE TABLE
Aggregate Option Exercises In Last Fiscal Year and Option Value at
December 31, 1994
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options at In-the-Money Options at
December 31, 1994 December 31, 1994(a)
--------------------- -----------------------
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise Realized Unexercisable Unexercisable
- - - - - ---- --------------- -------- ------------- -------------
<S> <C> <C> <C> <C>
Donald A. Hoyle, Jr. 5,000 $80,000 33,000/28,000 $611,000/$356,000
John W. Reuther 3,871 $61,936 22,629/24,500 $415,951/$311,500
</TABLE>
- - - - - -----------------------
(a) Based upon the difference between the market value of $35.00 a share on
December 31, 1994 and the exercise price of the option.
Certain Relationships and Related Transactions
The Bank has had and expects to have in the future, loan and other banking
transactions in the ordinary course of business with many of its Directors,
officers, and their associates. All extensions of credit to such persons have
been made in the ordinary course of business on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons, and in the opinion of the management
of the Bank, do not involve more than a normal risk of collectibility or present
other unfavorable features.
The law firm of Needle & Goldenziel was paid legal fees of approximately
$37,000 from the Company or its subsidiaries for legal services rendered during
1994. Gene E. Goldenziel, who is a Director of the Bank and the Company, is a
partner in Needle & Goldenziel. Needle & Goldenziel has been retained to perform
legal services in 1995.
<PAGE> 15
OFFICERS OF THE COMPANY AND THE BANK
Information concerning the Executive Officers of the Company is provided
above under "Information Concerning Nominees" and "Information Concerning
Continuing Directors."
The following table sets forth selected information about the officers of
the Bank, each of whom is elected by the Board of Directors and each of whom
holds office at the discretion of the Board of Directors. Except for Christopher
I. Mellon, each of the officers of the Bank has been principally employed as an
officer or employee of the Bank for more than the past five years. "Officer of
the Bank" as used herein means those persons with the title of Senior Vice
President and higher:
<TABLE>
<CAPTION>
Name Age Position with the Bank Held Since
---- --- ---------------------- ----------
<S> <C> <C> <C>
John S. Guzey 87 Chairman 1992
Director 1960
Donald A. Hoyle, Jr. 60 President
Director 1984
John W. Reuther 45 Senior Executive Vice President 1987
Director 1988
Christopher I. Mellon, 30 Executive Vice President (a) 1995
CPA (a)
Patricia A. Cobb, Esq. 37 Senior Vice President 1990
James E. Jackson 51 Senior Vice President 1987
Dorothea C. Metz 69 Senior Vice President 1995
</TABLE>
- - - - - ----------
(a) Prior to joining the Bank in 1993, he was employed as Corporate Director of
Strategic Planning, US Foodservice; Senior Vice President of Operations,
Franklin First Savings Bank; and Audit Manager, KPMG Peat Marwick.
INDEPENDENT PUBLIC ACCOUNTANTS
The accounting firm of KPMG Peat Marwick acted as the Company's independent
public accountants for the fiscal year ended December 31, 1994 and has been
selected to act as the Company's independent public accountant for the fiscal
year ended December 31, 1995. A representative of KPMG Peat Marwick is expected
to be present at the annual meeting of shareholders and to have the opportunity
to make a statement, if he desires to do so, and is expected to be available to
respond to appropriate questions.
<PAGE> 16
SHAREHOLDER PROPOSALS
Shareholder proposals regarding the 1996 Annual Meeting must be submitted
to the Company by January 12, 1996.
ANNUAL REPORT
This Proxy Statement is accompanied by the Annual Report to Shareholders of
the Company for the year ended December 31, 1994.
EACH PERSON SOLICITED HEREUNDER CAN OBTAIN A COPY OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 1994 REQUIRED TO BE
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WITHOUT CHARGE, EXCEPT FOR
EXHIBITS TO THE REPORT, BY SENDING A WRITTEN REQUEST THEREFOR TO:
Donald A. Hoyle, Jr., President
Pioneer American Holding Company Corp.
41 North Main Street
Carbondale, Pennsylvania 18407
<PAGE> 17
PIONEER AMERICAN HOLDING COMPANY CORP.
Proxy for Annual Meeting of Shareholders, June 6, 1995
Solicited on behalf of the Board of Directors
The undersigned hereby constitutes and appoints Daniel J. Corazzi, John J.
Kuna and Basil Telep, and each of them, as attorneys-in-fact and proxies of the
undersigned, with full power of substitution for and in the name, place and
stead of the undersigned to appear at the Annual Meeting of Shareholders of
Pioneer American Holding Company Corp. ("Pioneer"), to be held on the 6th day
of June, 1995, and at any postponement or adjournment thereof, and to vote all
of the shares of the Common Stock of Pioneer which the undersigned is entitled
to vote, with all the powers and authority the undersigned would possess if
personally present. The undersigned directs that this proxy be voted as
follows:
Please mark your votes as in this example. /X/
- - - - - -------------------------------------------------------------------------------
The Board of Directors recommends that shareholders vote for the election of
the nominees.
- - - - - -------------------------------------------------------------------------------
1. For the election of the nominees listed below as directors as described in
the accompanying Proxy Statement.
/ / FOR (To withhold authority to vote for nominees listed below check
this box. / /)
Nominees: Gene E. Goldenziel, William K. Nasser, Sr. and John W. Walski
To withhold authority to vote for any individual nominee, write the nominee's
name on the space provided below.
- - - - - -------------------------------------------------------------------------------
2. To transact such other business as may properly come before this meeting or
any postponement or adjournment thereof.
(Continued, and to be signed on the reverse side)
<PAGE> 18
This Proxy will, when properly executed, be voted as directed. If no
directions to the contrary are indicated, the persons named herein intend to
vote for the election of both nominees for directors listed above.
This proxy confers certain discretionary authority described in the Proxy
Statement; a majority of said attorneys and proxies present at said meeting (or
if only one shall be present, then that one) may exercise all of the powers
hereunder. The undersigned hereby acknowledges receipt of the Proxy Statement
dated May 12, 1995 and Pioneer's Annual Report to Shareholders for 1994.
Dated ______________________________________, 1995
(Please date this Proxy)
____________________________________________(SEAL)
(Shareholder's Signature)
____________________________________________(SEAL)
(Shareholder's Signature)
____________________________________________(SEAL)
(Shareholder's Signature)
____________________________________________(SEAL)
(Shareholder's Signature)
It would be helpful if you signed your name or
names exactly as it appears hereon, indicating any
official position or representative capacity.
PLEASE MARK, DATE, SIGN AND RETURN THIS PROXY CARD IN THE ENCLOSED ENVELOPE.
