[DESCRIPTION] AMENDMENT # 1
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED) FOR THE FISCAL YEAR ENDED
DECEMBER 31, 1995
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
Commission File Number 0-14506
PIONEER AMERICAN HOLDING COMPANY CORP.
(Exact name of Registrant as specified in its charter)
41 North Main Street
Pennsylvania Carbondale, PA 18407-2357
(State or other jurisdiction of (Address of principal executive
incorporation or organization) offices including zip code)
23-2319931
(I.R.S. Employer
Identification Number)
(717) 282-2662
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
NONE
(Title of class)
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $10.00 par value
(Title of class)
Indicate by check mark whether the registrant (i) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (ii) has been subject to such filing
requirements for the past 90 days. YES X NO
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
The aggregate market value of voting stock held by non-affiliates of
the registrant is $39,193,282.50(1)
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date. At March 1, 1996,
there were 1,396,175 common shares outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
(Specific sections incorporated are identified under applicable items
herein)
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(1) The aggregate dollar amount of the common stock set forth equals the
number of shares of the registrant's common stock outstanding, reduced by the
amount of common stock held by executive officers, directors and shareholders
owning in excess of 10% of the registrant's common stock, multiplied by the
closing high bid price for the registrant's common stock on March 1, 1996, and
does not reflect an actual trade. The information provided shall in no way be
construed as an admission that any officer, director or 10% shareholder in the
registrant may be deemed an affiliate of the registrant or that he is the
beneficial owner of the shares reported as being held by him, and any such
inference is hereby disclaimed. The information provided herein is included
solely for the record-keeping purposes of the Securities and Exchange
Commission.
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EXPLANATORY NOTE
This Amendment No. 1 to the registrant's Annual Report on Form 10-K for
the year ended December 31, 1995, as filed with the Securities and Exchange
Commission on March 29, 1996 (the "1995 10-K"), is being filed to provide the
disclosure required by Items 10 through 13 of Form 10-K which the registrant had
incorporated into the 1995 10-K by reference to its proxy statement for the
registrant's 1996 annual meeting of shareholders. Since the registrant did not
file its definitive proxy statement within 120 days after the end of the fiscal
year covered by the 1995 10-K, the information required by Items 10 through 13
of Form 10-K is accordingly set forth below.
PART III
ITEM 10. DIRECTORS AND OFFICERS OF THE REGISTRANT.
Directors and Officers
The following table sets forth certain information with respect to the
directors of the Company and the officers and directors of the Bank. Each of the
directors named below is both a director of the Company and the Bank. "Officer
of the Bank" as used herein means those persons with the title of Senior Vice
President and higher. Except for Christopher I. Mellon each of the officers of
the Bank has been principally employed by the Bank for more than the past five
years.
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Name Age Position (Held Since)
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Donald A. Hoyle, Jr. 61 President and Director of the
Company and the Bank (1984)
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John Guzey 88 Chairman (1992) and Director of
the Company and the Bank (1960)
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John W. Reuther 46 Senior Executive Vice President
(1987) and Director (1988)
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Christopher I. Mellon, CPA (a) 46 Executive Vice President (1995)
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Patricia A. Cobb, Esquire 38 Senior Vice President (1990)
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James E. Jackson 52 Senior Vice President (1987)
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Dorothea C. Metz 70 Senior Vice President (1995)
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Richard Chojnowski (b) 53 Director (1994)
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Gene E. Goldenziel (c) 48 Director (1985)
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William K. Nasser (d) 80 Director (1969)
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Margaret L. O'Connor, R.N. (e) 65 Director (1995)
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Eldore Sebastianelli (f) 75 Treasurer/Director (1984)
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John W. Walski (g) 74 Director (1982)
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(a) Prior to joining the Bank in 1993, Mr. Mellon was employed as
Corporate Director of Strategic Planning, U.S. Foodservice, Senior Vice
President of Operations, Franklin First Savings Bank and Assistant Manager, KPMG
Peat Marwick.
(b) Electrical contractor.
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(c) Attorney - Needle & Goldenzeil.
(d) Certified Public Accountant - William K. Nasser Accountants
(e) Former Mayor, Clarks Summit.
(f) Co-owner - C&S Excavating Company.
(g) Retired - Grant Markets.
Beneficial Ownership Reports
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of the Company's Common Stock, to file with the Securities and Exchange
Commission ("SEC") initial reports of ownership and reports of changes in
ownership of Common Stock and other securities of the Company. Such persons are
required by the SEC to furnish the Company with copies of all Section 16(a)
forms that they file.
To the Company's knowledge, during the year ended December 31, 1995,
based solely on a review of the copies of the Section 16(a) reports furnished to
the Company and on written representations that no other reports were required,
all of the Company's directors, officers and ten percent stockholders have
complied with Section 16(a) of the Exchange Act.
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ITEM 11. 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, 1995 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. 1995 $181,800 $36,366 - 0 - $53,771
President of the Bank
and the Company 1994 177,500 35,200 16,000 63,364
1993 161,100 29,300 16,000 60,519
John W. Reuther, 1995 $134,750 $23,700 - 0 - $41,926
Senior Executive Vice
President of the Bank and 1994 132,200 22,940 14,000 45,123
the Company
1993 121,300 21,340 14,000 28,671
</TABLE>
(a) For Mr. Hoyle, includes $6,000, $13,664 and $17,580 contributed by the
Company or the Bank on his behalf to the Employee Stock Ownership Plan,
$7,771, $6,000 and $7,089 contributed to the Savings and Investments Plan
and $40,000, $43,700 and $35,850 to pay insurance premiums to fund the
Company's obligations under the Executive Retirement Plan, in 1995, 1994 and
1993, respectively.
For Mr. Reuther, includes $5,390, $10,846 and $12,800 contributed by the
Company or the Bank on his behalf to the Employee Stock Ownership Plan,
$6,536, $6,277 and $5,793 contributed to the Savings and Investments Plan
and $30,000, $28,000 and $10,078 to pay insurance premiums to fund the
Company's obligations under the Executive Retirement Plan, in 1995, 1994 and
1993, respectively.
(b) Includes Directors fees of $16,500 for Mr. Hoyle and $16,250 for Mr.
Reuther.
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
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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 $494,331 for Donald A. Hoyle, Jr. and $724,827 for
John W. Reuther.
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.
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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.
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.
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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, 1995, 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.
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 certain information concerning the
shares acquired upon exercise of options, the number of unexercised options and
the value of unexercised options at December 31, 1995 held by the Executive
Officers listed in the Summary Table.
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OPTION EXERCISES AND YEAR-END VALUE TABLE
Aggregate Option Exercises In Last Fiscal Year and
Option Value at December 31, 1995
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options at In-the-Money Options at
December 31, 1995 December 31, 1995(a)
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Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise Realized Unexercisable Unexercisable
- ---- --------------- -------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Donald A. Hoyle, Jr. 5,015 $110,330 47,985/8,000 $983,648/$140,000
John W. Reuther 4,375 $96,250 35,754/7,000 $714,219/$122,500
</TABLE>
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(a) Based upon the difference between the market value of $39.50 a share on
December 31, 1995 and the exercise price of the option.
Compensation of Directors
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 1995.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth, as of April 30, 1996, 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) 5.23%
Gene E. Goldenziel Director 28,998(d) 2.07%
John S. Guzey Chairman/Director 28,000 2.00%
Donald A. Hoyle, Jr. President/Director 62,295(e) 4.45%
William K. Nasser Director 76,754(f) 5.48%
One Dunham Drive
Dunmore, PA
Margaret L. O'Connor, R.N. Director 22,408(g) 1.60%
John W. Reuther Senior Executive Vice 49,583(h) 3.54%
President/Director
Eldore Sebastianelli Treasurer/Director 24,182(i) 1.73%
John W. Walski Director 50,572(j) 3.61%
All Directors and Executive
Officers of the Company as
a group (13 persons) 394,970 28.20%
</TABLE>
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(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 April 30, 1996. 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 April 30, 1996, the ESOP held 75,084 shares of which 3,400
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 47,985 shares which may be acquired upon the exercise of stock
options. Also includes 4,208 shares owned jointly with his spouse and 4,955
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 35,754 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 3,911 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 22,036
shares held jointly with his spouse.
(j) Includes 17,324 shares owned jointly with his spouse.
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ITEM 13. 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 $39,780 from the Company or its subsidiaries for legal services
rendered during 1995. Gene E. Goldenziel, who is a Director of the Bank and the
Company, is a partner in Needle, Goldenziel & Pascale. Needle, Goldenziel &
Pascale has been retained to perform legal services in 1996.
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SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this Amendment No. 1 to its
Annual Report on Form 10-K for the year ended December 31, 1995 to be signed on
its behalf by the undersigned thereunto duly authorized.
PIONEER AMERICAN HOLDING COMPANY CORP.
Date: May 7, 1996 By: /s/ Donald A. Hoyle, Jr.
-------------------------
Donald A. Hoyle, Jr.,
President
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