<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
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
/X/ Definitive Proxy Statement (as permitted by Rule 14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Penn Virginia Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
Penn Virginia Corporation
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:(1)
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total Fee Paid:
- --------------------------------------------------------------------------------
/ / 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:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
- --------------------------------------------------------------------------------
- ---------------
(1) Set forth the amount on which the filing fee is calculated and state
how it was determined.
<PAGE> 2
PENN VIRGINIA CORPORATION
ONE RADNOR CORPORATE CENTER
SUITE 200
100 MATSONFORD ROAD
RADNOR, PENNSYLVANIA 19087
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 7, 1996
You are cordially invited to attend the Annual Meeting of Shareholders of
Penn Virginia Corporation (the "Company") which will be held at the Company's
corporate office, One Radnor Corporate Center, Suite 200, 100 Matsonford Road,
Radnor, Pennsylvania, Tuesday, May 7, 1996, at 10:00 a.m., Eastern Daylight
Time, for the following purposes:
1. To elect a board of eight directors to serve until the next Annual
Meeting of Shareholders, or until their successors are elected and
qualified; and
2. To transact such other business as may properly come before the meeting
or any adjournments thereof.
Only shareholders of record at the close of business on March 8, 1996 will
be entitled to notice of and to vote at the Annual Meeting or any adjournments
thereof. A complete list of shareholders so entitled to vote will be available
at the Company's corporate office in Radnor, Pennsylvania during regular
business hours for a period of ten calendar days prior to the Annual Meeting.
All shareholders, regardless of whether they expect to attend the meeting
in person, are requested to vote, date, sign and promptly return the enclosed
proxy in the accompanying envelope. The person executing the proxy may revoke it
by filing with the Secretary of the Company a duly executed proxy bearing a
later date or by electing to vote in person at the Annual Meeting.
This Notice, the accompanying Proxy Statement, and the enclosed Proxy are
sent to you by order of the Board of Directors of the Company.
BEVERLY COLE MCGUIRE
Corporate Secretary
Radnor, Pennsylvania
March 22, 1996
<PAGE> 3
PENN VIRGINIA CORPORATION
ONE RADNOR CORPORATE CENTER
SUITE 200
100 MATSONFORD ROAD
RADNOR, PENNSYLVANIA 19087
March 22, 1996
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the Board of Directors of Penn
Virginia Corporation (the "Company") for use at the Annual Meeting of
Shareholders on May 7, 1996. The expense of this solicitation will be paid by
the Company. Some officers and employees may solicit proxies personally and by
telephone without specific compensation therefor. Three officers of the Company
have been designated as the proxies to vote shares at the Annual Meeting in
accordance with the instructions on the proxy card enclosed with this Proxy
Statement. Each proxy submitted will be voted as directed, but if no specific
instructions are given with respect to the matters to be voted upon, the shares
represented by each signed proxy will be voted FOR the election of each of the
nominees to the Company's Board of Directors. The grant of a proxy will also
confer discretionary authority on the persons named in the proxy to vote on
matters incidental to the conduct of the Annual Meeting.
Each shareholder has the right to revoke a proxy at any time before it is
voted by filing with the Secretary of the Company a written revocation before
the proxy is voted or by submitting to the Company before the taking of the vote
a duly executed proxy bearing a later date or by voting the shares subject to
such proxy by written ballot at the Annual Meeting. Any shareholder may attend
the Annual Meeting and vote in person whether or not a proxy was previously
submitted. Attendance at the Annual Meeting will not in and of itself constitute
a revocation of a proxy.
Shareholders of record at the close of business on March 8, 1996 will be
entitled to vote at the meeting. On that date there were outstanding and
entitled to vote (one vote per share) 4,262,240 shares of common stock, par
value $6.25 per share, not including 175,277 shares held by the Company in its
treasury. The presence, in person or by proxy, of shareholders entitled to cast
a majority of votes will be necessary to constitute a quorum for the transaction
of business. Management does not expect any matters other than the election of
directors to be presented for action at the Annual Meeting.
ELECTION OF DIRECTORS
On February 6, 1996, the Board of Directors amended the Company's bylaws to
increase the number of directors from seven to eight and elected A. James
Dearlove, President and Chief Operating Officer of the Company, to serve as a
director. Messrs. Albrecht and Gaul, who are the current Board representatives
of the Penn Virginia shareholder, Interkohle Beteiligungsgesellschaft mbH
("Interkohle"), are not standing for re-election. Interkohle designated Messrs.
Oppenborn and Teyssen as nominees for director pursuant to the terms of the
agreement between Interkohle and the Company.
Eight directors are to be elected at the Annual Meeting and will serve
until the next Annual Meeting of Shareholders or until their respective
successors are elected and qualified. Under Virginia law, directors are elected
by a plurality of the votes cast in person or by proxy by the shareholders
entitled to vote at a meeting at which a quorum is present. Abstentions and
broker non-votes will have no effect on the outcome of the vote. The nominees
for election as directors are identified in the following table. Although all
nominees currently intend to serve on the Board, if any nominee should decline
or be unable to serve, the Board will designate a substitute nominee. The
Company has no reason to believe that any nominee will decline or be unable to
serve.
1
<PAGE> 4
THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE FOR EACH OF THE EIGHT NOMINEES.
NOMINEES FOR DIRECTOR, AGE, POSITION WITH THE COMPANY,
BUSINESS EXPERIENCE DURING PAST FIVE YEARS,
AND OTHER DIRECTORSHIPS
- --------------------------------------------------------------------------------
LENNOX K. BLACK, age 66 Director since 1984(1)
Chairman and Chief Executive Officer of the Company (April 1992 to
date); Chairman of the Board of Teleflex, Inc. (1982 to date); Chief
Executive Officer of Teleflex, Inc. (1982 to 1995).
Director of Teleflex, Inc., Quaker Chemical Corporation, Pep Boys, and
Westmoreland Coal Company.
JOHN D. CADIGAN, age 55 Director since 1987(3)
President of Rio Petrol, Inc., oil and gas investments (1984 to date);
Vice President, Campbell Investment Company, investments (1976 to
date); President of Cadigan Corporation, investments (1980 to date).
Director of Rio Petrol, Inc., Campbell Investment Company, and Joshua
Green Corporation.
A. JAMES DEARLOVE, age 48 Director since February 1996
President and Chief Operating Officer of the Company (1994 to date);
Senior Vice President of the Company (1992 to 1994); Vice President
of the Company (1986 to 1992).
Director of Powell River Project, Westmoreland Resources, Inc., and
National Council of Coal Lessors.
HANS-ALBERT OPPENBORN, age 53
Head of the Department Economic Analysis of PreussenElektra AG,
electricity supply industry, (1985 to date); Managing Director of
Interkohle Beteiligungsgesellschaft mbH (1987 to date); Managing
Director of KLE Kernkraftwerke Lippe-Ems GmbH (1994 to date).
Director of Viking Cable AS, Oslo and ZEP Zentrum fur Energetische
Perspektive AG, Moscow.
JOHN A. H. SHOBER, age 62 Director since 1978(2)(3)
Vice Chairman of the Board of the Company (April 1992 to date);
President and Chief Executive Officer of the Company (1989 to March
1992).
Director of AirGas, Inc., Betz Laboratories, Inc., Eisenhower Exchange
Fellowships, Ensign Bickford Industries, Inc., First Reserve
Corporation, MIBRAG mbH, Pennsylvania Hospital and YMCA of
Philadelphia.
JOHANNES TEYSSEN, age 36
Head of the Legal Division of PreussenElektra AG, electricity supply
industry, (1989 to date); Managing Director of Interkohle
Beteiligungsgesellschaft mbH (1995 to date); Managing Director of
Gesellschaft fur Energiebeteiligungen in Frankfurt/Oder mbH,
electricity supply industry (1995 to date).
Member of the Supervisory boards of Stadtwerke Brandenburg and of
Stadtwerke Potsdam; Deputy Chairman of the Supervisory board of
Uberlandzentrale Helmstedt AG.
FREDERICK C. WITSELL, JR., age 62 Director since 1972(2)
Vice Chairman, J.P. Morgan Florida FSB (Sept. 1993 to date); Managing
Director, Morgan Guaranty Trust Company of New York (Feb. 1989 to
Jan. 1994).
Director and Vice Chairman of J.P. Morgan Florida FSB.
2
<PAGE> 5
MINTURN T. WRIGHT, III, age 70 Director since 1973 (1)
Partner, Dechert Price & Rhoads, attorneys (1961 to 1995; retired June
30, 1995).
Director of The Philadelphia Contributionship.
- ---------------
(1) Member of the Executive Committee
(2) Member of the Compensation and Benefits Committee
(3) Member of the Audit Committee
ADDITIONAL INFORMATION ABOUT THE BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors held eight meetings during 1995. The Board has three
standing committees: the Executive Committee, the Compensation and Benefits
Committee, and the Audit Committee. The Board does not have a Nominating
Committee. Each director attended at least 75 percent of total 1995 Board and
standing committee meetings on which he served, except Dr. Gaul who attended 22
percent or two of nine such meetings.
Prior to May 1995 the Board had only two standing committees: the Audit
Committee and the Executive and Compensation Committee, composed of Messrs.
Black (Chairman), Gaul, Wright, and Witsell. The Executive and Compensation
Committee met once in 1995. In May 1995, the Board split this committee into two
committees: the Executive Committee and the Compensation and Benefits Committee.
The Executive Committee, composed of Messrs. Black (Chairman), Gaul, and
Wright, subject to certain exceptions and applicable law, has and may exercise
all the authority of the Board in the management of the business and affairs of
the Company when the Board is not in session. The Executive Committee did not
meet in 1995.
The Compensation and Benefits Committee, composed of Messrs. Witsell
(Chairman), Shober, and Gaul, reviews and makes recommendations to the Board of
Directors regarding compensation for officers of the Company and periodically
reviews the Company's and subsidiaries' employee benefit programs and reports
its recommendations to the Board of Directors. The Compensation and Benefits
Committee did not meet in 1995.
The Audit Committee of the Board of Directors, composed of Messrs. Cadigan
(Chairman), Shober and Albrecht, met three times during 1995. The Audit
Committee recommends to the Board of Directors for its nomination independent
public accountants to audit the books, records and accounts of the Company, and
reviews and approves the overall scope and adequacy of the independent and
internal audit programs and the proposed form of the Company's consolidated
financial statements. The Audit Committee also reviews the results, findings and
recommendations of audits performed by the independent public accountants and
the internal auditor, the system of internal accounting controls, the
significant accounting policies of the Company as they apply to its consolidated
financial statements, the audit fees to be paid to the independent public
accountants and the nature of non-audit services performed by the independent
public accountants.
COMPENSATION OF DIRECTORS
Each director who is not a full-time employee of the Company receives an
annual retainer of $15,000 of which $8,000 is paid in cash in four quarterly
payments of $2,000 each. The remaining $7,000 is paid in December in the form of
Company stock or cash, at the election of each director. During the first six
months of 1995, Mr. Shober received a cash retainer of $2,000 per month for
services as a consultant in lieu of the quarterly cash retainer for the first
and second quarter retainers of 1995. The consulting agreement with Mr. Shober
was terminated June 30, 1995 at his request. Each director who is not a
full-time employee of the Company receives $650 for each Board of Directors'
meeting he attends. Each director also receives $650 to attend meetings of the
standing committees on which he serves and to attend meetings of the following
non-Board committees: the Coal Investment Committee and the Oil and Gas
Investment Committee. Committee chairmen receive an extra $100 for meetings they
chair. Directors also receive stock options under the 1995 Directors' Stock
Option Plan (the "1995 Plan") which was approved by the shareholders in May
1995. Under
3
<PAGE> 6
the terms of the 1995 Plan, each eligible director receives 5,000 options when
he first becomes an eligible director. Each eligible director also receives
options to acquire 100 shares on the first business day of each of the years
1996 through 1999.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the name and address of each shareholder of
the Company who is known by the Company to beneficially own more than five
percent of the Company's outstanding common stock, the number of shares
beneficially owned by each, and the percentage of outstanding common stock so
owned, as of December 31, 1995. All such information is based on information
furnished to the Company by the respective shareholders or contained in
Schedules 13D and 13G filed with the Securities and Exchange Commission (the
"SEC") prior to March 8, 1996.
<TABLE>
<CAPTION>
SHARES PERCENT
BENEFICIALLY OF
NAME AND ADDRESS OWNED CLASS
- ------------------------------------------------------------------------- ------------ -------
<S> <C> <C>
INTERKOHLE BETEILIGUNGSGESELLSCHAFT MBH.................................. 868,258(1) 20.4%
Tresckowstrasse 5
30457 Hannover
Germany
E. B. LEISENRING, JR..................................................... 333,450(2) 7.8%
One Tower Bridge
Suite 501
West Conshohocken, Pennsylvania 19428
QUEST ADVISORY CORP...................................................... 303,650(3) 7.1%
1414 Avenue of the Americas
New York, New York 10019
FIRST FIDELITY BANK, N.A................................................. 278,930(4) 6.5%
(an indirect subsidiary of First Union Corporation of New Jersey)
550 Broad Street
Newark, New Jersey 07102
</TABLE>
- ---------------
(1) Interkohle Beteiligungsgesellschaft mbH is a wholly-owned subsidiary of VEBA
AG, a corporation organized under the laws of the Federal Republic of
Germany. Currently, Hans Michael Gaul and Eckhard Albrecht are directors of
the Company. Dr. Gaul is Deputy Chairman of the Management Board of
PreussenElektra AG, the majority shareholder of Interkohle, and a member of
the Management Board of VEBA AG. Mr. Albrecht is President of the Board of
Management of Stinnes Intercarbon AG, which is part of Stinnes AG, a global
trader owned by VEBA AG. Dr. Gaul and Mr. Albrecht are not standing for
re-election; however, Interkohle has designated Dr. Johannes Teyssen and Mr.
Hans-Albert Oppenborn as its nominees for directors of the Company pursuant
to the terms of the agreement between Interkohle and the Company. Mr.
Oppenborn and Dr. Teyssen are both directors of Interkohle. The Company
believes Interkohle intends to vote such shares for the election of the
nominees for directors designated by the Board of Directors of the Company.
(2) These shares are held as follows: 34,784 shares of which Mr. Leisenring is
the record and beneficial owner and with respect to which he has sole voting
and investment power; 177,166 shares owned by four trusts of which Mr.
Leisenring is co-trustee with First Fidelity Bank, N.A. and with respect he
shares voting and investment power; 21,500 shares owned by five trusts of
which Mr. Leisenring is a co-trustee and with respect to which he shares
voting and investment power; and 100,000 shares owned of record and
beneficially by the Sinkler Corporation (a wholly-owned subsidiary of Wentz
Corporation) of which Mr. Leisenring is a director and deemed to be a
beneficial owner under applicable rules of the SEC. The number of shares
reported as beneficially owned does not include 21,550 shares owned by Mr.
Leisenring's wife and adult children.
(3) These 303,650 shares are beneficially owned by Quest Advisory Corp.
("Quest") and with respect to which Quest has sole voting and sole
dispositive power. According to its filings with the SEC on Schedule 13G,
Quest is an investment adviser registered under Section 203 of the
Investment Advisers Act of 1940. Mr. Charles M. Royce, President of Quest,
may be deemed to be a controlling person of
4
<PAGE> 7
Quest and as such may be deemed to beneficially own the shares beneficially
owned by Quest. According to Quest's Schedule 13G, Mr. Royce does not own
any shares outside of Quest and disclaims beneficial ownership of the shares
held by Quest.
(4) These shares are held in a number of separate accounts including a total of
177,166 shares owned by four trusts of which First Fidelity Bank, N.A. is
co-trustee with Mr. Leisenring and with respect to which it shares voting
and investment power. Such 177,166 shares are also included in the 333,450
shares shown opposite Mr. Leisenring's name in the foregoing table. Also
included are 24,952 shares held by First Fidelity Bank, N.A. as trustee of
the Company's employees' retirement/savings plan for the accounts of
employee participants. Under such plan, the trustee will vote all shares
held for a participant's account as requested by the participant and absent
specific instructions from the participant the trustee may vote the shares
in its discretion. Also included are 44,386 shares held by First Fidelity
Bank, N.A. as custodian of the Company's employees' stock ownership plan for
the accounts of employee participants. Under such plan, the custodian will
vote all shares held for a participant's account as requested by the
participant.
The table appearing below sets forth the information as of March 8, 1996
with respect to shares of the Company's common stock beneficially owned by the
current directors, nominees for director, the Company's Chief Executive Officer
and named executive officers, and all directors and executive officers as a
group, and the percentage of the Company's outstanding common stock so owned by
each.
SECURITY OWNERSHIP OF MANAGEMENT
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DIRECTORS, NOMINEES FOR AMOUNT AND NATURE OF
TITLE OF DIRECTOR, AND NAMED BENEFICIAL OWNERSHIP
CLASS EXECUTIVE OFFICERS (1) PERCENT OF CLASS
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock Eckhard Albrecht..................... 5,269(2) (14)
Common Stock Lennox K. Black...................... 71,226(3) 1.6%
Common Stock John D. Cadigan...................... 47,184(4) 1.1%
Common Stock A. James Dearlove.................... 51,350(5) 1.2%
Common Stock Hans Michael Gaul.................... 5,552(6) (14)
Common Stock Vincent Matthews, III................ 32,941(7) (14)
Common Stock Hans-Albert Oppenborn................ -0-(8) (14)
Common Stock John A. H. Shober.................... 118,000(9) 2.8%
Common Stock Johannes Teyssen..................... -0-(10) (14)
Common Stock Frederick C. Witsell, Jr............. 7,325(11) (14)
Common Stock Minturn T. Wright, III............... 6,910(12) (14)
Common Stock All Directors, Nominees for Director,
and Executive Officers as a group
(13 persons)......................... 370,134(13) 8.3%
</TABLE>
- ---------------
(1) Unless otherwise indicated, all shares are owned directly by the named
person and he or she has sole voting and investment power with respect to
such shares. Does not include options which are not exercisable before May
22, 1996.
(2) Includes options to purchase 5,000 shares. Does not include 868,258 shares
beneficially owned by Interkohle. See footnote 1 to the table "Security
Ownership of Certain Beneficial Owners and Management" on page 4.
(3) Includes options to purchase 70,000 shares.
(4) Includes options to purchase 5,000 shares; 10,800 shares of Company common
stock owned by Campbell Investment Company (of which Mr. Cadigan is an
officer and director) of which Mr. Cadigan may be deemed to be a beneficial
owner under applicable rules of the SEC; 11,000 shares of Company common
stock owned by Rio Petrol, Inc. (of which Mr. Cadigan is an officer and
director) of which Mr. Cadigan may be deemed to be a beneficial owner. Also
includes a total of 16,134 shares of
5
<PAGE> 8
Company common stock held in a number of separate accounts with respect to
which Mr. Cadigan shares voting or investment power and may be deemed to be
a beneficial owner.
(5) Includes options to purchase 45,700 shares; 2,055 shares held in Mr.
Dearlove's Retirement/Savings Plan account; and 3,295 shares held in Mr.
Dearlove's ESOP account.
(6) Includes options to purchase 5,000 shares. Does not include 868,258 shares
beneficially owned by Interkohle. See footnote 1 to the table "Security
Ownership of Certain Beneficial Owners and Management" on page 4.
(7) Includes options to purchase 30,000 shares; 316 shares held in Mr.
Matthews' Retirement/Savings Plan account; and 2,125 shares held in Mr.
Matthews' ESOP account.
(8) Does not include 868,258 shares beneficially owned by Interkohle. See
footnote 1 to the table "Security Ownership of Certain Beneficial Owners
and Management" on page 4.
(9) Includes options to purchase 15,000 shares. Also includes 100,000 shares
owned of record and beneficially by The Sinkler Corporation (a wholly-owned
subsidiary of Wentz Corporation) of which Mr. Shober is a director and may
be deemed to be a beneficial owner under applicable rules of the SEC.
(10) Does not include 868,258 shares beneficially owned by Interkohle. See
footnote 1 to the table "Security Ownership of Certain Beneficial Owners
and Management" on page 4.
(11) Includes options to purchase 5,000 shares.
(12) Includes options to purchase 5,000 shares.
(13) Includes options to purchase 204,200 shares; 3,087 shares in the Employees'
Retirement/Savings Plan and 6,781 shares in the ESOP Plan held in accounts
of the individual executive officers.
(14) Less than one percent.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors and persons who own more than ten percent of a
registered class of the Company's equity securities to file reports of ownership
and changes in ownership with the SEC. Executive officers, directors and greater
than ten percent shareholders are required by SEC regulations to furnish the
Company with copies of all Section 16(a) forms they file.
Based on its review of the copies of such forms received by it, the Company
believes that during 1995 all filing requirements applicable to its executive
officers, directors and greater than ten percent beneficial owners were complied
with.
6
<PAGE> 9
EXECUTIVE COMPENSATION
The following summary compensation table sets forth information for the
Chief Executive Officer and the named executive officers of the Company at
December 31, 1995 for the years 1995, 1994 and 1993:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
ANNUAL LONG-TERM
COMPENSATION COMPENSATION
-------------------------------------------------
OTHER ALL
ANNUAL AWARDS OTHER
NAME AND SALARY BONUS COMPENSATION NUMBER OF COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($) OPTIONS ($)(6)
<S> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------
Lennox K. Black,........................ 1995 75,000 -0- 32,832(1) 30,000 -0-
Chairman and Chief 1994 75,000 -0- 32,082(1) 20,000 -0-
Executive Officer 1993 75,000 -0- 30,132(1) -0- -0-
A. James Dearlove,...................... 1995 200,000 40,000 (5) 20,000 26,320(2)
President and Chief 1994 166,250 40,000 (5) 10,000 25,067(2)
Operating Officer 1993 147,450 7,372 (5) -0- 19,659(2)
Vincent Matthews, III................... 1995 190,372 20,000 (5) 10,000 26,559(3)
Senior Vice President 1994 181,000 40,000 38,041(4) 10,000 26,318(3)
1993 171,600 8,580 (5) -0- 23,060(3)
</TABLE>
- ---------------
<TABLE>
<CAPTION>
1995 1994 1993
------- ------- -------
<C> <S> <C> <C> <C>
(1) Director fees and $15,000 annual retainer......................... $21,600 $20,850 $18,900
11,232 11,232 11,232
Car allowance.....................................................
------- ------- -------
$32,832 $32,082 $30,132
(2) Company contribution to Mr. Dearlove's Retirement/Savings $ 1,800 $ 1,800 $ 1,800
account...........................................................
23,476 22,223 16,815
Company contribution to Mr. Dearlove's ESOP account...............
1,044 1,044 1,044
Life insurance premiums...........................................
------- ------- -------
$26,320 $25,067 $19,659
(3) Company contribution to Mr. Matthews' Retirement/Savings $ 1,800 $ 1,800 $ 1,800
account...........................................................
23,031 22,747 19,567
Company contribution to Mr. Matthews' ESOP account................
1,728 1,771 1,693
Life insurance premiums...........................................
------- ------- -------
$26,559 $26,318 $23,060
</TABLE>
(4) Includes $11,232 car allowance, $14,300 moving allowance, and $12,509 moving
expenses.
(5) Total Other Annual Compensation is less than the lesser of $50,000 or 10
percent of the named executive officer's total annual salary and bonus; no
disclosure is required.
(6) Under the Company's policy concerning severance benefits, senior officers
(including all executive officers) whose employment is terminated following
a change in control (as defined in the policy) of the Company will receive
severance pay according to a formula which takes into account the officer's
salary, length of service with the Company, and age. The maximum amount
payable to a senior officer under the policy is 250 percent of then-current
annual salary. The amount under the severance policy that would be paid to
Mr. Dearlove if terminated on the date of this proxy statement following a
change of control would be $359,375. Mr. Matthews, who resigned effective
March 8, 1996, will receive a total of $231,928 over the period March 9,
1996 through May 9, 1997.
7
<PAGE> 10
OPTION EXERCISES AND HOLDINGS. The following table sets forth certain
information with respect to named executive officers of the Company concerning
the exercise of options during the last fiscal year and unexercised options held
as of the end of the fiscal year.
INDIVIDUAL OPTION GRANTS IN 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
PERCENT ANNUAL RATES OF
NUMBER OF OF TOTAL STOCK PRICE
SECURITIES OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO OPTION TERM
OPTIONS EMPLOYEES IN EXERCISE EXPIRATION -----------------------
NAME GRANTED 1995(1) PRICE DATE 5% 10%
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Lennox K. Black................ 30,000(2) 30% $32.25 Feb. 7, 2005 $608,456 $1,541,946
A. James Dearlove.............. 20,000 20% $32.25 Feb. 7, 2005 $405,637 $1,027,964
Vincent Matthews, III.......... 10,000 10% $32.25 Feb. 7, 2005 $202,819 $ 513,982
</TABLE>
- ---------------
(1) Includes all of the stock options granted under the 1994 Stock Option Plan
and all of the stock options granted under the 1995 Directors' Stock Option
Plan to directors who were also employees of the Company.
(2) Includes 5,000 options granted under the 1995 Directors' Stock Option Plan
and 25,000 options granted under the 1994 Stock Option Plan.
The following table presents information regarding the number of
unexercised options to purchase common shares and the number of unexercised
stock appreciation rights at December 31, 1995:
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF NUMBER OF SECURITIES IN-THE-MONEY OPTIONS/SARS
SHARES UNDERLYING UNEXERCISED
ACQUIRED OPTIONS/SARS AT YEAR-END AT YEAR-END($)(1)
ON VALUE --------------------------- ---------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Lennox K. Black..................... -0- -0- 40,000 30,000 20,000 -0-
A. James Dearlove................... -0- -0- 25,700 20,000 -0- -0-
Vincent Matthews, III............... -0- -0- 20,000 10,000 -0- -0-
</TABLE>
- ---------------
(1) Values are calculated by subtracting the exercise price per share from the
market value per share of the Company's common stock at fiscal year-end,
multiplied by the number of shares of common stock underlying the
in-the-money options, and assume a fair market value at fiscal year-end of
$32.25 per share (the closing price of the Company's common stock on
December 29, 1995).
REPORT OF THE COMPENSATION AND BENEFITS COMMITTEE
The Board's Compensation and Benefits Committee (the "Committee") makes
recommendations to the Board of Directors concerning the compensation of the
Chief Executive Officer and the highly compensated executive officers of the
Company.
COMPENSATION POLICIES TOWARD EXECUTIVE OFFICERS. The Committee's executive
compensation policies are designed to provide competitive levels of compensation
that relate compensation to the Company's annual and long-term performance
goals, reward above-average corporate performance, recognize individual
initiative and achievements, and assist the Company in attracting and retaining
qualified executives. The Committee attempts to achieve these objectives through
a combination of base salary, stock options, and cash bonus awards.
8
<PAGE> 11
BASE SALARY. Executive salaries are reviewed by the Committee every year
and are established for individual executive officers based on subjective
evaluations of each individual officer's performance and the Company's
performance. The Committee believes that salaries are established in a manner
that is both competitive and reasonable within the Company's industry.
STOCK OPTIONS. Stock options are granted to executive officers and other
employees of the Company by the Committee as a means of providing long-term
incentive to the Company's employees. The Committee believes that stock options
encourage increased performance by the Company's employees, including its
officers, and align the interests of the Company's employees with the interests
of the Company's stockholders. Decisions concerning the granting of stock
options are made on the same basis as decisions concerning base salary as
discussed in the previous paragraph.
CASH BONUS AWARDS. The Committee considers on an annual basis whether to
pay cash bonuses to some or all of the Company's employees, including the
Company's executive officers. The Committee's objective is to ensure the Company
will remain competitive in its compensation practices and be able to retain
qualified executive officers.
CHIEF EXECUTIVE OFFICER COMPENSATION. The compensation of the Company's
Chief Executive Officer is determined in the same manner as the compensation for
other executive officers as described above.
Mr. Black's base salary was $75,000 in 1995. Mr. Black was granted 25,000
options in February 1995 at an exercise price of $32.25 under the 1994 Stock
Option Plan. Mr. Black also received 5,000 options at an exercise price of
$32.25 in 1995 under the 1995 Directors' Stock Option Plan.
The Compensation and Benefits Committee:
Frederick C. Witsell, Jr. (Chairman)
<TABLE>
<S> <C>
Hans Michael Gaul John A. H. Shober
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Executive and Compensation Committee of the Board of Directors was
composed of Messrs. Black (Chairman), Gaul, Witsell and Wright until May 2, 1995
at which date the Board separated the Executive and Compensation Committee into
two committees: 1) The Executive Committee and 2) The Compensation and Benefits
Committee. The Compensation and Benefits Committee is now composed entirely of
outside directors. Mr. Black served as Chairman of the Board and Chief Executive
Officer of the Company for the year ending December 31, 1995.
Frederick C. Witsell, Jr., is currently Vice Chairman of J.P. Morgan
Florida FSB, a subsidiary of J.P. Morgan & Co. Incorporated. Morgan Guaranty
Trust Company, another subsidiary of J.P. Morgan, performs investment banking
services for the Company for which fees are received.
Minturn T. Wright, III, a director and nominee for re-election as a
director, is a retired partner in the law firm of Dechert Price & Rhoads.
Dechert Price & Rhoads received fees for legal services and, until Mr. Wright's
retirement in June 1995, for Mr. Wright's services as a director of the Company.
PERFORMANCE GRAPH
The following graph shows changes over the past five years in the value of
$100 invested in (1) Standard and Poor's Industrials Index; (2) Standard and
Poor's Energy Index; and (3) Penn Virginia Corporation Common Stock. The
year-end values of each investment are based on share price appreciation plus
dividends paid in cash, with the dividends invested on the date they were paid.
9
<PAGE> 12
CUMULATIVE SHAREHOLDER RETURN
DECEMBER 31, 1990 TO DECEMBER 31, 1995
<TABLE>
<CAPTION>
S&P ENERGY S&P
MEASUREMENT PERIOD PENN COMPOSITE INDUSTRIALS
(FISCAL YEAR COVERED) VIRGINIA CORP INDEX INDEX
<S> <C> <C> <C>
1990 100 100 100
1991 81.6 107.53 130.76
1992 83.4 109.72 138.21
1993 97.8 126.98 150.69
1994 86.00 131.85 156.45
1995 93.1 172.41 210.41
</TABLE>
EMPLOYEES' RETIREMENT/SAVINGS PLAN
Employees of the Company and its subsidiaries and affiliates who have
joined in the Penn Virginia Corporation and Affiliated Companies Employees'
Retirement/Savings Plan (the "Retirement/Savings Plan"), who are not covered by
collective bargaining agreement and who have completed twelve months of service
within which they have been credited with at least 1,000 hours of service, may
participate in the Retirement/Savings Plan.
Under the Retirement/Savings Plan, an employee may elect to contribute to
the Retirement/Savings Plan up to 10 percent of his or her eligible monthly
compensation. These contributions may be either salary deferral contributions,
whereby an employee elects to defer a portion of his or her salary and have the
deferred amount contributed to the Retirement/Savings Plan, or savings
contributions. Both forms of contributions reduce the amount of compensation
that would otherwise be paid to an employee, but salary deferral contributions
are intended to qualify for the federal income tax treatment provided by section
401(k) of the Internal Revenue Code. The committee administering the
Retirement/Savings Plan has the right to raise the percentage of compensation an
employee may defer and contribute to the Retirement/Savings Plan up to 15
percent. The Company makes matching contributions to the Retirement/Savings Plan
on behalf of each participant, up to a maximum of 6 percent of the participant's
compensation. Beginning July 1, 1988, the annual matching contribution was
limited to $1,800 per employee for any calendar year. Matching contributions are
made to the trustee of the Retirement/Savings Plan (First Fidelity Bank, N.A.)
which uses the contributions to purchase common stock of the Company for
participating employees' accounts. Employee contributions are made to the
trustee which makes investments according to individual employee elections.
Once each plan year, a participant who has attained age 60 may direct the
trustee to sell a portion of the shares in his account and transfer the proceeds
to fixed investment funds at The Vanguard Group which provide the participant
with a variable rate of return on the amount so invested.
10
<PAGE> 13
EMPLOYEES' RETIREMENT PLAN
The Company sponsors a defined benefit pension plan for employees of the
Company and its subsidiaries to which employees make no contributions. In
general, the pension plan provides for payment of annual retirement benefits to
eligible employees who retire at a normal retirement age of 65. A career average
benefit formula determines the pension payment, which is based on the years of
service and the annual earnings of the employee. The pension plan is designed to
provide a retirement income which, when combined with benefits from the
Company's defined contribution plans and Social Security, will maintain the
long-term employee's standard of living at the time of retirement. The pension
plan also provides for deferred retirement benefits for disabled employees,
reduced benefits for early retirement, and additional accrual for years of
service beyond age 65.
The following table shows the estimated annual pension benefits payable to
employees of the Company, including officers, upon retirement at age 65, in
various remuneration and years-of-service classifications, assuming the election
of a pension benefit payable as a life annuity with five years certain. The
table is representative of an employee who is currently age 65. Benefit amounts
set forth in the table are not presently subject to any deduction for Social
Security benefits or other offset amounts.
<TABLE>
<CAPTION>
ESTIMATED ANNUAL RETIREMENT BENEFIT FOR YEARS OF SERVICE INDICATED
ANNUAL -------------------------------------------------------------------------------------------------
REMUNERATION 15 20 25 30 35 40
- ------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
$125,000 $ 24,375 $ 32,500 $ 40,625 $ 48,750 $ 56,875 $ 65,000
$150,000 $ 29,250 $ 39,000 $ 48,750 $ 58,500 $ 68,250 $ 78,000
$175,000 $ 29,250* $ 39,000* $ 48,750* $ 58,500* $ 68,250* $ 78,000*
$200,000 $ 29,250* $ 39,000* $ 48,750* $ 58,500* $ 68,250* $ 78,000*
</TABLE>
- ---------------
* Beginning in 1989, the Internal Revenue Code restricted the amount of annual
compensation which may be considered in the computation of benefits payable
from a qualified pension plan. The 1995 compensation limit is $150,000 for the
table projections; this limit is assumed to remain unchanged in future years.
Years of service credited under the pension plan for the following
individuals are: Mr. Dearlove -- 18 years and Mr. Matthews -- 7 years.
1985 PLAN OF DEFERRED COMPENSATION
The Company maintains the Plan of Deferred Compensation as Amended and
Restated January 1, 1994 (the "1985 Plan") to provide officers with pension
benefits in excess of those payable under the Employee's Retirement Plan, for
benefits lost due to Internal Revenue Code (the "Code") limitations. Prior to
1994, only officers with compensation in excess of $200,000, as adjusted by the
Code, were eligible to participate. Effective January 1, 1994, only certain
officers with compensation in excess of $150,000, as adjusted by the Code, were
eligible to participate. Two previous officers are currently receiving benefits
from the 1985 Plan and only one current officer is accruing benefits under the
1985 Plan. An officer who terminates employment with the Company, other than by
reason of retirement or death, will not be eligible to receive a benefit.
Assuming reasonable increases in compensation until retirement at age 65, the
estimated annual benefit payable under the 1985 Plan for Mr. Dearlove is
$26,580. Because of Mr. Matthews' resignation which was effective March 8, 1996,
he is no longer eligible for benefits under the 1985 Plan.
STOCK OPTION PLANS
(a) 1980 INCENTIVE STOCK PLAN -- Under the terms of the Company's 1980
Incentive Stock Plan (the "1980 Plan"), which has expired, the Company could
offer an aggregate of 200,000 shares (subject to adjustments for stock
dividends, stock splits and the like) of the Company's common stock to officers
and key employees in a management role of the Company and its 50
percent-or-more-owned subsidiaries upon the exercise of stock options or stock
appreciation rights granted to them pursuant to the 1980 Plan. A stock
appreciation right gives the holder, as an alternative to the exercise of the
related stock option, the right to receive, without payment to the Company, any
appreciation in the value of the shares subject to the related
11
<PAGE> 14
option that has taken place between the dates of grant and exercise. Subject to
certain restrictions, the holder may receive this gain in cash or stock or in a
combination of both. A stock option or stock appreciation right granted under
the 1980 Plan may be exercised at any time after twelve months and prior to ten
years following the date it is granted. Upon exercise of a stock option any
related stock appreciation right automatically expires. Upon exercise of a stock
appreciation right the stock option to which it is attached automatically
expires. The 1980 Plan has expired and no more options may be granted.
Previously granted and unexercised options are still exercisable.
(b) THE 1994 STOCK OPTION PLAN -- On May 2, 1995, the shareholders of the
Company adopted the 1994 Stock Option Plan ("the 1994 Plan"). The 1994 Plan
provides for two incentive elements, non-qualified stock options and incentive
stock options. The 1994 Plan allows the Company to offer an aggregate of 500,000
shares (subject to adjustment for stock dividends, stock splits and the like) of
the common stock of the Company to eligible directors, officers and key
employees of the Company upon the exercise of stock options granted to them
pursuant to this Plan. A stock option gives the holder the right to purchase
from the Company a specified number of shares of the Company's common stock for
a specified price during a specified period.
The 1994 Plan is administered by a committee (the "Committee") composed of
three directors of the Company who were appointed by the Board of Directors and
who are not eligible to participate in the 1994 Plan. The Committee is
authorized, subject to the provisions of the 1994 Plan, to determine which
eligible directors and employees shall be granted options and the terms and
amounts. The 1994 Plan may be amended by the Committee, but any amendment that
increases the aggregate number of shares of common stock that may be issued
under the 1994 Plan, that changes the class of eligible employees, or that
otherwise requires the approval of shareholders under Rule 16b-3 of the
Securities Exchange Act of 1934 will require the prior approval of the
shareholders of the Company.
Options may be granted under the 1994 Plan at any time. The price per share
of all shares of common stock of the Company for which options are granted under
the 1994 Plan, which is payable to the Company in cash upon exercise of the
option, may not be less than the market value (as reported on NASDAQ) of such
shares on the date the option is granted. Options are exercisable at any time
after twelve months and prior to ten years following the date of grant. Options
are not transferable except by will or the laws of descent and distribution.
EMPLOYEES' STOCK OWNERSHIP PLAN (ESOP)
Effective June 1, 1985, the Company established an Employees' Stock
Ownership Plan ("ESOP") and Trust for the benefit of employees. All employees of
the Company and its subsidiaries and affiliates, who are not covered by a
collective bargaining agreement and who have completed 12 months of service
within which they have been credited with at least 1,000 hours of service,
automatically become participants in the ESOP. The Trust borrowed $6,000,000 and
the proceeds of the loan were used to purchase a total of 122,583 shares of
Company common stock. The stock was held in an unallocated stock account and
then allocated to participants' accounts as the loan was paid off. Distributions
will be made as elected to participating employees and their beneficiaries upon
retirement or other termination of service. Participants are neither required
nor permitted to make contributions to the ESOP.
Under the loan agreement, the Company guaranteed the loan and was obligated
to make annual contributions sufficient to enable the Trust to repay the loan,
including interest. Principal on the loan is due in forty quarterly installments
of $150,000; the first payment was made in September 1985 and the last payment
was made in June 1995. When a payment is made on the loan, stock is released for
allocation to participants' accounts in the proportion that each participant's
compensation bears to the total compensation of all participants.
In February 1996, the Board approved a second stage to this ESOP. The ESOP
will borrow $2 million from the Company bearing interest at the prevailing
market rate and use the entire proceeds of the loan to purchase treasury stock.
Under the loan, the Company will make annual contributions sufficient to enable
the ESOP to repay the loan including interest over a 10-year period.
12
<PAGE> 15
FINANCIAL AND OTHER INFORMATION
KPMG Peat Marwick LLP, a certified public accounting firm, served as the
Company's independent auditors for the year 1995; management expects that KPMG
will continue to serve as such for the Company in 1996. Since the Board of
Directors has the authority to select the Company's independent auditors, it is
not proposed that any formal action be taken at the Annual Meeting. The Company
anticipates that a representative from KPMG will be present at the Annual
Meeting and will have the opportunity to make a statement, if he or she wants to
do so, and to respond to appropriate questions concerning the Company's
financial statements.
Upon the written request of any person who on the record date was a record
owner of Company common stock, or who represents in good faith that he was on
such date a beneficial owner of such stock entitled to vote at the Annual
Meeting, the Company will send to such person, without charge, a copy of its
Annual Report on Form 10-K for 1995, as filed with the SEC. Requests for this
report should be directed to Beverly Cole McGuire, Corporate Secretary, Penn
Virginia Corporation, One Radnor Corporate Center, Suite 200, 100 Matsonford
Road, Radnor, Pennsylvania 19087.
SHAREHOLDER PROPOSALS
Any proposal submitted by shareholders for inclusion in the Company's proxy
statement and proxy for the 1997 Annual Meeting of Shareholders of the Company
must be received by the Company at its corporate offices in Radnor, Pennsylvania
on or before November 21, 1996, and must comply in all other respects with
applicable rules and regulations of the Securities and Exchange Commission
relating to such inclusion.
OTHER BUSINESS
The Board of Directors knows of no matters which are to be presented for
consideration at the Annual Meeting other than those specifically described in
the Notice of Annual Meeting. If any other matters properly come before the
meeting, however, it is the intention of the persons designated as proxies to
vote on them in accordance with their best judgment.
By order of the Board of Directors.
BEVERLY COLE MCGUIRE
Corporate Secretary
March 22, 1996
13
<PAGE> 16
PROXY
PENN VIRGINIA CORPORATION PROXY SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS for Annual Meeting on May 7, 1996.
The undersigned hereby appoints A. James Dearlove, Steven W. Tholen, and
Beverly Cole McGuire and each of them, proxy or proxies of the undersigned,
with the power of substitution, to vote all shares of stock of the Company held
by the undersigned which are entitled to be voted at the Annual Meeting of
Shareholders to be held in the Company's Corporate Office, One Radnor Corporate
Center, Suite 200, 100 Matsonford Road, Radnor, Pennsylvania on Tuesday May 7,
1996, at 10:00 A.M. and any adjournments thereof, on all matters coming before
said meeting as shown on the reverse side of this card. The undersigned
acknowledges receipt of the 1995 Annual Report and the Notice of Meeting and
Proxy Statement dated March 22, 1996.
(CONTINUED AND TO BE SIGNED ON THE OTHER SIDE)
<PAGE> 17
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO CHOICE
IS SPECIFIED, SUCH SHARES WILL BE VOTED FOR THE ITEMS LISTED BELOW.
Lennox K. Black, John D. Cadigan, A. James Dearlove, Hans-Albert Oppenborn,
John A. H. Shober, Johannes Teyssen, Frederick C. Witsell, Jr., Minturn T.
Wright, III.
(Instruction: To withhold authority to vote for any individual nominee, strike
a line through the nominee's name in the above list.)
Item No. 1-Election of Directors
/ / For all nominees listed
/ / Withheld authority to vote for all nominees listed
Item No. 2-In their discretion, on any other business which may properly come
before the meeting.
/ / For / / Against / / Abstain
Please mark, date and sign as your name appears to the left and return in the
enclosed envelope. When signing as attorney, administrator, executor, guardian
or trustee, please give full title as such.
Dated ,1996
- --------------------------------------------------
Signature
- --------------------------------------------------
Signature
- --------------------------------------------------
I plan to attend the meeting. / / Yes / / No
