SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-A
For Registration of Certain Classes of Securities
Pursuant to Section 12(b) or (g) of the
Securities Exchange Act of 1934
PENN TREATY AMERICAN CORPORATION
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(Exact name of registrant as specified in its charter)
Pennsylvania 23-1664166
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(State of incorporation or organization) (I.R.S. Employer Identification No.)
3440 Lehigh Street, Allentown, PA 18103
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(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
Common Stock, $.10 Par Value New York Stock Exchange
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If this Form relates to the registration of a class of securities pursuant
to Section 12(b) of the Exchange Act and is effective pursuant to General
Instruction A.(c), please check the following box.
If this Form relates to the registration of a class of securities pursuant
to Section 12(g) of the Exchange Act and is effective pursuant to General
Instruction A.(d), please check the following box.
Securities Act registration statement file number to which this form
relates:
Securities to be registered pursuant to Section 12(g) of the Act:
NONE
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(Title of class)
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Item 1. Description of Registrant's Securities to be Registered.
The stock of Penn Treaty American Corporation, a Pennsylvania corporation
(the "Company"), approved to be listed on the New York Stock Exchange, Inc. (the
"Exchange"), is the Company's common stock, par value $.10 per share (the
"Common Stock"). Subject to the rights of holders of any series of preferred
stock which may from time to time be issued by the Company, holders of Common
Stock are entitled to one vote per share on matters acted upon at any
shareholders' meeting, including the election of directors, and to dividends
when, as and if declared by the Board of Directors out of funds legally
available therefor. There is no cumulative voting and the Common Stock is not
redeemable. In the event of any liquidation, dissolution or winding up of the
Company, each holder of Common Stock is entitled to share ratably in all assets
of the Company remaining after the payment of liabilities and any amounts
required to be paid to holders of any preferred stock issued by the Company, if
any. Holders of Common Stock have no preemptive or conversion rights and are not
subject to further calls or assessments by the Company; and there are not any
redemption or sinking fund provisions. All shares of Common Stock now
outstanding are fully paid and non-assessable.
Certain provisions of the Company's Restated and Amended Articles of
Incorporation, as amended (the "Articles"), were designed to make the Company a
less attractive target for acquisition by an outsider who does not have the
support of the Company's directors. These provisions: (1) provide that the
Company's Board of Directors is divided into three classes, each of which is
comprised of three directors elected for a three-year term, with one class being
elected each year; that directors may be removed without cause only with the
approval of 67% of the voting power of the stock entitled to vote in the
election of directors; and that any director elected to fill a vacancy, however
created, serves for the remainder of the term of the director which he or she is
replacing; (2) require the affirmative vote of shareholders owning at least 67%
of the outstanding shares of the Company's Common Stock in order for the Company
to: amend, repeal or add any provision to the Articles; merge or consolidate
with another corporation, other than a wholly-owned subsidiary; exchange shares
of the Company's Common Stock in such a manner that a corporation, person or
entity acquires the issued or outstanding shares of Common Stock of the Company
pursuant to a vote of shareholders; sell, lease, convey, encumber or otherwise
dispose of all or substantially all of the property or business of the Company;
or liquidate or dissolve the Company; (3) permit the Board of Directors to
oppose a tender offer or other offer for the Company's securities, and allow the
Board to consider any pertinent issue in determining whether to oppose any such
offer; and (4) require the Company to obtain the approval of the holders of a
majority of all capital stock entitled to vote in the election of directors
prior to any direct or indirect purchase of securities of any class by the
Company from a shareholder who beneficially owns 20% or more of the outstanding
securities in the class to be acquired and has not held such securities for more
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than two years at the time of such purchase; provided that the foregoing vote of
shareholders is not required if any such purchase is made by the Company as part
of a tender or exchange offer to purchase securities of the same class from all
holders of such securities in a manner complying with the applicable
requirements of the Exchange Act.
In addition, certain provisions of the Company's Amended and Restated
By-laws, as amended (the "Bylaws"), require that shareholder nominations for
election to the Board of Directors must be made in writing and delivered or
mailed to the President of the Company not less than fifty days nor more than
seventy-five days prior to any meeting of shareholders called for the election
of directors; provided however, that if less than fifty days' notice of the
meeting is given to shareholders, such nominations shall be mailed or delivered
to the President not later than the close of business on the seventh day
following the day on which the notice of the meeting was mailed.
The Pennsylvania Business Corporation Law of 1988 (the "1988 BCL") includes
certain shareholder protection provisions, some of which apply to the Company
and two of which, relating to "Disgorgement by Certain Controlling Shareholders
following Attempts to Acquire Control" and "Control Share Acquisitions," the
Company has specifically opted out of pursuant to an amendment to its by-laws.
The following is a description of those provisions of the 1988 BCL that still
apply to the Company and that may have an anti-takeover effect. This description
of the 1988 BCL is only a summary thereof, does not purport to be complete and
is qualified in its entirety by reference to the full text of the 1988 BCL.
(i) The control transaction provisions allow holders of voting shares of a
corporation to "put" their stock to an acquirer for fair value in the event of a
control transaction (the acquisition of 20% of the voting stock of the
corporation). Fair value is defined as not less than the highest price paid by
the acquirer during a certain 90 day period.
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(ii) An interested shareholder (the beneficial owner of twenty percent of
the voting stock either of a corporation or of an affiliate of the corporation
who was at any time within the five-year period immediately prior to the date in
question the beneficial owner of twenty percent of the voting stock of the
corporation) cannot engage in a business combination with the corporation for a
period of five years unless: (a) the board approves the business combination or
the acquisition of shares in advance, or (b) if the interested shareholder owns
80% of such stock, the business combination is approved by a majority of the
disinterested shareholders and the transaction satisfies certain "fair price"
provisions. After the five-year period, the same restrictions apply, unless the
transaction either is approved by a majority of the disinterested shareholders
or satisfies the fair price provisions.
(iii) Corporations may adopt shareholders' rights plans with discriminatory
provisions (sometimes referred to as poison pills) whereby options to acquire
shares or corporate assets are created and issued which contain terms that limit
persons owning or offering to acquire a specified percentage of outstanding
shares from exercising, converting, transferring or receiving options and allows
the exercise of options to be limited to shareholders or triggered based upon
control transactions. Such poison pills take effect only in the event of a
control transaction. Pursuant to the 1988 BCL, such poison pills may be adopted
by the Board without shareholder approval.
(iv) In taking action with respect to tender offers or takeover proposals
(as for any other action), directors may, in considering the best interests of
the corporation, consider the effects of any action upon employees, suppliers,
customers, communities where the corporation is located and all other pertinent
factors.
(v) Shareholders of a corporation no longer have a statutory right to call
special meetings of shareholders or to propose amendments to the articles under
the provisions of the 1988 BCL.
The foregoing provisions may discourage certain types of transactions that
involve a change of control of the Company and ensure a measure of continuity in
the management of the business and affairs of the Company. While the Company
does not currently have a shareholder rights plan or poison pill, the effect of
the above-described provisions may be to deter hostile takeovers at a price
higher than the prevailing market price for the Common Stock and to permit
current management to remain in control of the Company. In some circumstances
certain shareholders may consider these anti-takeover provisions to have
disadvantageous effects. Tender offers or other non-open market acquisitions of
stock are frequently made at prices above the prevailing market price of a
company's stock. In addition, acquisitions of stock by persons attempting to
acquire control through market purchases may cause the market price of the stock
to reach levels that are higher than would otherwise be the case. These
anti-takeover provisions may discourage any or all such acquisitions,
particularly those of less than all of the Company's shares, and may thereby
deprive certain holders of the Company's Common Stock of any opportunity to sell
their stock at a temporarily higher market price.
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Pursuant to an amendment to the Company's By-laws adopted on July 19, 1990,
the Company opted out of "Disgorgement by Certain Controlling Shareholders
following Attempts to Acquire Control," which would otherwise allow the Company
to recover all profits derived by any person or group that acquires control or
disclosed an intention to acquire voting power over 20% of the equity securities
of the Company on the disposition of any of the securities of the Company
acquired within two years prior or eighteen months after acquiring such control
or announcing an intention to that effect. The Company also opted out of
"Control Share Acquisitions," which would otherwise suspend the voting rights of
a shareholder when his ownership of the Company's securities crossed any of
three thresholds (20%, 33% or 50%). The voting rights are held in abeyance until
the shareholders holding a majority of disinterested shares vote to restore
them. The inapplicability of these provisions mitigates somewhat the deterrence
of hostile anti-takeover attempts at prices in excess of the prevailing market
prices and lessens the ability of current management to retain control of the
Company.
In addition to provisions of the 1988 BCL, insurance laws and regulations
of each of Pennsylvania, New York and Vermont provide, among other things, that
without the consent of the insurance commissioner of each such state, no person
may acquire control of the Company and that any person or holder of shares of
Common Stock or securities convertible into Common Stock (such as the Notes)
possessing 10% or more of the aggregate voting power of the Common Stock
(inclusive of shares issuable upon conversion of all such convertible
securities) will be presumed to have acquired such control unless each such
insurance commissioner, upon application, has determined otherwise.
Item 2. Exhibits
Not applicable.
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Signature
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant has duly caused this registration statement to be signed on
its behalf by the undersigned, thereto duly authorized.
Penn Treaty American Corporation
By: _________________________
Cameron B. Waite
Chief Financial Officer
Date: December 8, 1998
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