<PAGE> 1
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:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of Commission Only (as
/X/ Definitive Proxy Statement permitted by Rule 14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
PARKVALE FINANCIAL CORPORATION
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
(NAME OF PERSON(S) FILING PROXY STATEMENT IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / $125 per Exchange Act Rules 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 transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(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 No.:
------------------------------
(3) Filing Party:
------------------------------
(4) Date Filed:
------------------------------
<PAGE> 2
PARKVALE FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
4220 WILLIAM PENN HIGHWAY, MONROEVILLE, PA 15146
September 15, 1997
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Parkvale Financial Corporation. The meeting will be held at the Pittsburgh
Athletic Association, 4215 Fifth Avenue, Pittsburgh, Pennsylvania, on Thursday,
October 23, 1997, at 10:00 a.m.
At the meeting, stockholders will act on the matters set forth in the
accompanying Notice of Annual Meeting and Proxy Statement and on any other
business matters properly brought before the meeting.
It is important that your shares be represented and voted at the Annual
Meeting regardless of whether you plan to attend. Please complete, sign, date
and return the enclosed proxy card promptly in the envelope provided.
Sincerely,
/s/ ROBERT J. MCCARTHY, JR.
Robert J. McCarthy, Jr.
President and
Chief Executive Officer
<PAGE> 3
PARKVALE FINANCIAL CORPORATION
4220 WILLIAM PENN HIGHWAY
MONROEVILLE, PENNSYLVANIA 15146
(412) 373-7200
------------------------------
NOTICE OF ANNUAL MEETING
TO BE HELD ON OCTOBER 23, 1997
------------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Parkvale
Financial Corporation, Monroeville, Pennsylvania (the "Corporation") will be
held at the Pittsburgh Athletic Association, 4215 Fifth Avenue, Pittsburgh,
Pennsylvania, on Thursday, October 23, 1997, at 10:00 a.m., Eastern Time, for
the following purposes, all of which are more completely set forth in the
accompanying Proxy Statement:
(1) To elect two directors for a term of three years or until their
successors have been elected and qualified;
(2) To ratify the appointment of Ernst & Young LLP as the Corporation's
independent auditors for the fiscal year ending June 30, 1998; and
(3) To transact such other business as may properly come before the
meeting. Except with respect to procedural matters incident to the
conduct of the meeting, management of the Corporation is not aware of
any matters other than those set forth above which may properly come
before the meeting.
Stockholders of the Corporation of record at the close of business on
August 25, 1997 are entitled to notice of and to vote at the Annual Meeting.
By Order of the Board of Directors
/s/ ERNA A. GOLOTA
Erna A. Golota
Secretary
Monroeville, Pennsylvania
September 15, 1997
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. IT IS IMPORTANT
THAT YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN IF YOU
PLAN TO BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE
ENCLOSED PROXY PROMPTLY IN THE POSTAGE-PAID ENVELOPE PROVIDED. IF YOU ATTEND THE
MEETING, YOU MAY VOTE EITHER IN PERSON OR BY PROXY. ANY PROXY GIVEN MAY BE
REVOKED BY YOU IN WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE
THEREOF.
<PAGE> 4
PARKVALE FINANCIAL CORPORATION
------------------------------
PROXY STATEMENT
------------------------------
ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is being furnished to holders of common stock, par
value $1.00 per share ("Common Stock"), of Parkvale Financial Corporation (the
"Corporation" or "PFC"), the holding company of Parkvale Savings Bank (the
"Bank"), in connection with the solicitation of proxies on behalf of the Board
of Directors, for use at the Annual Meeting of Stockholders to be held at the
Pittsburgh Athletic Association, 4215 Fifth Avenue, Pittsburgh, Pennsylvania, on
Thursday, October 23, 1997, at 10:00 a.m., Eastern Time, and at any adjournment
thereof for the purposes set forth in the Notice of Annual Meeting. This Proxy
Statement is being first sent to stockholders on or about September 15, 1997.
The proxies solicited hereby, if properly signed and returned to the
Corporation, will be voted in accordance with the instructions contained therein
if they are not revoked prior to their use. IF NO CONTRARY INSTRUCTIONS ARE
GIVEN, EACH PROXY RECEIVED WILL BE VOTED FOR THE SLATE OF DIRECTORS DESCRIBED
HEREIN, FOR RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP AS THE
CORPORATION'S INDEPENDENT AUDITORS, AND UPON THE TRANSACTION OF SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING, IN ACCORDANCE WITH THE BEST
JUDGMENT OF THE PERSONS APPOINTED AS PROXIES.
Any stockholder giving a proxy has the power to revoke it at any time
before it is exercised by (i) filing with the Secretary of the Corporation
written notice thereof (Erna A. Golota, Secretary, Parkvale Financial
Corporation, 4220 William Penn Highway, Monroeville, Pennsylvania 15146), (ii)
submitting a duly executed proxy bearing a later date, or (iii) appearing at the
Annual Meeting and giving the Secretary notice of his or her intention to vote
in person. Proxies solicited hereby may be exercised only at the Annual Meeting
and any adjournment thereof and will not be used for any other meeting.
VOTING SECURITIES AND BENEFICIAL OWNERSHIP THEREOF
Only stockholders of record at the close of business on August 25, 1997
(the "Voting Record Date") will be entitled to vote at the Annual Meeting. On
the Voting Record Date, there were 4,084,935 shares of common stock, par value
$1.00 per share, of the Corporation issued and outstanding ("Common Stock"), and
the Corporation had no other class of equity securities outstanding. Each share
of Common Stock is entitled to one vote on each proposal at the Annual Meeting,
with no cumulative voting for the election of directors permitted.
The following table sets forth, as of the Voting Record Date, certain
information as to the Common Stock beneficially owned by (i) persons or entities
known to the Corporation to be the beneficial owners of 5% or more of the
Corporation's Common Stock, (ii) directors of the Corporation, (iii) executive
officers of the Corporation who are not directors but who are named in the
Summary Compensation Table, and (iv) all directors and executive officers as a
group.
2
<PAGE> 5
The information shown is based upon filings pursuant to the Securities Exchange
Act of 1934, as amended ("Exchange Act"), and/or information furnished by the
individuals or entities.
<TABLE>
<CAPTION>
NUMBER OF SHARES
BENEFICIALLY OWNED AS PERCENT OF
NAME OF BENEFICIAL OWNER OF AUGUST 25, 1997(1) COMMON STOCK
- ----------------------------------------- ---------------------- -------------
<S> <C> <C>
Parkvale Financial Corporation 347,896 (2) 8.52%
Employee Stock Ownership Plan
4220 William Penn Highway
Monroeville, PA 15146
Beck, Mack & Oliver LLC 293,545 (3) 7.19
330 Madison Avenue
New York, NY 10017
Dimensional Fund Advisors Inc. 247,412 (4) 6.06
1299 Ocean Avenue
Santa Monica, CA 90401
DIRECTORS:
Fred P. Burger, Jr. 86,637 (5)(6) 2.11
Robert J. McCarthy, Jr. 210,802 (5)(7)(8) 5.09
Paul A. Mooney 62,538 (5)(9) 1.52
George W. Newland 62,832 (5)(10) 1.53
Robert D. Pfischner 98,835 (5)(11) 2.40
Warren R. Wenner 29,178 (5)(12) 0.71
EXECUTIVE OFFICERS
WHO ARE NOT DIRECTORS:
Bruce C. Gilleylen 61,792 (5)(7)(13) 1.51
Timothy G. Rubritz 60,957 (5)(7)(14) 1.48
Steven A. Friedman 47,183 (5)(7)(15) 1.15
DIRECTORS AND EXECUTIVE
OFFICERS AS A GROUP
(16 persons) 833,363 (5)(7) 19.26
</TABLE>
- ---------
(1) Under applicable regulations, shares are deemed to be beneficially owned by
a person if he or she directly or indirectly has or shares the power to
vote or dispose of the shares, whether or not he or she has any economic
interest in the shares. Unless otherwise indicated, the named beneficial
owner has sole voting and dispositive power with respect to the shares.
(2) Messrs. Pfischner, Newland and Mooney, directors of the Corporation, are
the trustees of the Employee Stock Ownership Plan ("ESOP"). To date,
343,962 shares of the 347,896 shares have been allocated to the
participants of the ESOP.
(3) Beck, Mack & Oliver LLC is an investment adviser registered under the
Investment Advisers Act of 1940 and the 293,545 shares are owned by
investment advisory clients of the firm. No one of these clients owns more
than 5% of said shares.
(4) Dimensional Fund Advisors Inc. is an investment adviser registered under
the Investment Advisers Act of 1940 and the 247,412 shares are held in
portfolios of certain affiliated entities. Dimensional disclaims beneficial
ownership of all such shares.
(5) Includes shares that may be acquired within 60 days through exercise of
stock options as follows: Mr. Burger, 19,529 shares; Mr. McCarthy, 53,921
shares; Mr. Mooney, 19,529 shares; Mr. Newland, 9,764 shares; Mr.
Pfischner, 29,295 shares; Mr. Wenner, 14,529 shares; Mr. Gilleylen, 10,812
shares; Mr. Rubritz, 20,577 shares; Mr. Friedman,
3
<PAGE> 6
19,356 shares; and all directors and officers as a group, 242,821 shares.
Shares of Common Stock which are subject to stock options are deemed to be
outstanding for the purpose of computing the percentage of outstanding
Common Stock owned by the individual or group but are not deemed
outstanding for the purpose of computing the percentage of Common Stock
owned by any other person or group. Exclusive of shares which may be
acquired upon the exercise of stock options, directors and officers of the
Corporation as a group beneficially owned 590,542 shares or 14.46% of the
issued and outstanding Common Stock.
(6) Includes 19,502 shares held under Mr. Burger's deferred fee agreement with
the Bank.
(7) Includes shares allocated to such person or group under the ESOP as
follows: Mr. McCarthy, 27,364 shares; Mr. Gilleylen, 16,678 shares; Mr.
Rubritz, 16,666 shares; Mr. Friedman, 11,213 shares; and all officers as a
group, 113,712 shares. Also includes shares allocated under the
Supplemental Executive Benefit Plan ("SEBP") as follows: Mr. McCarthy,
5,327 shares; Mr. Gilleylen, 127 shares; Mr. Rubritz, 121 shares; and all
officers as a group, 5,575 shares. (See Audit-Finance Committee Report On
Executive Compensation.) Shares are deemed to be beneficially owned by such
individuals or group as a result of their ability to direct the ESOP and
SEBP trustees' voting of such shares allocated to their respective
accounts.
(8) Includes 74,406 shares held jointly by Mr. McCarthy and his wife, 14,646
shares held by Mr. McCarthy as custodian for his children, and 35,138
shares held under deferred fee and compensation agreements with the Bank.
(9) Includes 34,657 shares held jointly by Mr. Mooney and his wife, 2,485
shares held jointly with his niece and 5,867 shares held under a deferred
fee agreement with the Bank. Does not include shares held under the ESOP,
of which Mr. Mooney is a trustee.
(10) Does not include shares held under the ESOP, of which Mr. Newland is a
trustee.
(11) Includes 17,163 shares held jointly by Mr. Pfischner and his wife, 976
shares held by his wife and 15,613 shares held under a deferred fee
agreement with the Bank. Also includes 6,616 shares held as a trustee for
the E.T. Lippert Saw Co. Salaried Employee Defined Benefit Plan Trust. Does
not include shares held under the ESOP, of which Mr. Pfischner is a
trustee.
(12) Includes 8,358 shares held jointly by Mr. Wenner and his wife and 6,291
shares held under a deferred fee agreement with the Bank.
(13) Includes 26,853 shares held jointly by Mr. Gilleylen and his wife.
(14) Includes 14,788 shares held jointly by Mr. Rubritz and his wife and 3,845
shares held by Mr. Rubritz as custodian for his children.
(15) Includes 8,752 shares held jointly by Mr. Friedman and his wife, 253 shares
held by his wife and 2,343 shares held by Mr. Friedman as custodian for his
children.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires that directors and officers of
the Corporation and the Bank file reports of ownership and changes in ownership
of the Common Stock with the Securities and Exchange Commission and the National
Association of Securities Dealers, Inc. Directors and officers are required to
furnish the Corporation with copies of all Section 16(a) forms they file. Based
solely upon review of copies of Forms 3, 4 and 5 received by the Corporation's
compliance administrator, the Corporation believes that all filing requirements
applicable to its directors and officers were complied with during fiscal 1997.
4
<PAGE> 7
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTOR,
DIRECTORS WHOSE TERMS CONTINUE AND EXECUTIVE OFFICERS
ELECTION OF DIRECTORS
Pursuant to the Bylaws of the Corporation and by resolution of the
Corporation's Board of Directors, the Board of Directors currently consists of
six members. The Board of Directors is divided into three classes, and members
of each class are elected for a term of three years and until their successors
are elected and qualified. One class of directors is to be elected annually. All
the nominees for election at this meeting have previously served as directors of
the Corporation. There are no arrangements or understandings between the
Corporation and any person pursuant to which such person has been nominated as a
director. No director or executive officer is related to any other director or
executive officer of either the Corporation or the Bank.
Unless otherwise directed, each proxy executed and returned by a
stockholder will be voted for the election of all the nominees listed below. If
any person named as nominee should be unable or unwilling to stand for election
at the time of the Annual Meeting, the proxies will nominate and vote for the
replacement nominee or nominees recommended by the Board of Directors. At this
time, the Board of Directors knows of no reason why any of the persons listed
below may not be able to serve as a director if elected. A majority of the
shares of Common Stock entitled to vote, present in person or by proxy at the
meeting, will constitute a quorum. The election of directors requires the
affirmative vote of a majority of the votes cast by all stockholders entitled to
vote thereon, whether in person or by proxy. Votes marked as "withhold
authority" on the election of directors are counted toward a quorum and have the
same legal effect as a vote against the election of the nominees. All of the
proposals for consideration at the Annual Meeting are considered "discretionary"
items upon which brokerage firms may vote in their discretion on behalf of their
clients if such clients have not furnished voting instructions. Thus, there are
no proposals to be considered at the Annual Meeting which are considered
"non-discretionary" and for which there will be "broker non-votes."
NOMINEES FOR TERMS EXPIRING IN 2000
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DIRECTOR
NAME AGE DURING THE PAST FIVE YEARS SINCE(1)
- ------------------------ --- --------------------------------------------- --------------
<S> <C> <C> <C>
Robert D. Pfischner 75 Chairman of the Board; President of E.T. 1968
Lippert Saw Co., a manufacturer of saw blades
for industry and fabricator of armor plate,
since 1973
Paul A. Mooney 87 Director; retired; previously President of PM 1968
Lumber Co.
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS THAT THE ABOVE NOMINEES
BE ELECTED AS DIRECTORS.
5
<PAGE> 8
DIRECTORS WITH TERMS EXPIRING IN 1998
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DIRECTOR
NAME AGE DURING THE PAST FIVE YEARS SINCE(1)
- ------------------------ --- --------------------------------------------- --------------
<S> <C> <C> <C>
Robert J. McCarthy, Jr. 54 Director; President and Chief Executive 1985
Officer of the Bank since December 1, 1984
and of the Corporation since organization in
August 1987; previously President and Chief
Executive Officer of Metropolitan Federal
Savings Bank, Bethesda, Maryland
George W. Newland 82 Director; retired; held honorary title of 1968
Vice President of the Bank from 1968 to 1989;
previously consultant with Mills Iron, Los
Angeles, California, from 1980 to 1989
</TABLE>
DIRECTORS WITH TERMS EXPIRING IN 1999
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DIRECTOR
NAME AGE DURING THE PAST FIVE YEARS SINCE(1)
- ------------------------ --- --------------------------------------------- --------------
<S> <C> <C> <C>
Fred P. Burger, Jr. 70 Director; President of Burger Agency, Inc., a 1981
real estate brokerage firm and insurance
agency, since 1948
Warren R. Wenner 76 Director; retired; previously a sales 1968
representative for The Gage Co., a
distributor of industrial tools and
equipment, from 1965 to 1985
</TABLE>
- ---------
(1) Includes terms as a director of the Bank prior to organization of the
Corporation in 1987. All directors of the Corporation currently serve as
directors of the Bank.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Corporation holds regular meetings at least
quarterly. Each member of the Board of Directors of the Corporation also serves
as a director of the Bank. During the year ended June 30, 1997, the Board of
Directors of the Corporation met nine times. All directors attended 100% of such
meetings and the meetings of the committees of the Board on which he served. All
members of the Board serve on the Nominating Committee, which met one time
during fiscal 1997. The Nominating Committee will consider nominations made by
stockholders if such nominations are made in accordance with Article IV, Section
3 of the Corporation's Bylaws. The Board also has other standing committees,
each served by the same members of the Board and in the same capacities as those
described below for similar committees of the Bank's Board. The Executive
Committee, which did not meet in fiscal 1997, has the authority to exercise all
of the powers of the Board between Board meetings. The joint Audit-Finance
Committee of the Corporation and the Bank met four times in fiscal 1997.
Directors of the Corporation do not receive any fees directly from the
Corporation for serving as Board and Committee members. The Board does not have
a separate compensation committee as determination of compensation is a function
of the Audit-Finance Committee.
The Board of Directors of the Bank meets regularly each month and may have
additional special meetings. The Board met twelve times during fiscal 1997. The
Bank has standing Executive, Audit-Finance and Site-Building Committees as
described below, in addition to other committees. During fiscal 1997, attendance
by the directors at Board and committee meetings averaged 96.6%. No director
failed to attend fewer than 75% of the aggregate number of meetings held during
the year by the Board of Directors and by all committees of the Board on which
he served.
6
<PAGE> 9
The Executive Committee has the authority to exercise all the powers of the
Board of Directors between Board meetings. Membership on the Executive
Committee, which consists of three members of the Board, rotates monthly with
each director, except for Messrs. Pfischner and McCarthy, serving at least one
month each quarter of the year. Mr. Pfischner currently serves as Chairman of
this committee. Mr. McCarthy attends but does not vote at the meetings. The
Executive Committee did not meet during fiscal 1997.
The Audit-Finance Committee reviews the Bank's budget, the scope and
results of the audit performed by the Corporation's and the Bank's independent
auditors, the scope and results of the examinations performed by the Office of
Thrift Supervision, the Pennsylvania Department of Banking and the Federal
Deposit Insurance Corporation, the Bank's system of internal control, and
monitors compliance with the Bank's established investment, interest rate risk,
financial futures and options policies. The members of such committee must
consider and act upon (1) all transactions with respect to the investment
portfolio, with the exception of Federal Funds sold, in excess of $25 million,
and (2) all hedging activities over $10 million and up to $25 million. In
addition, the Audit-Finance Committee reviews and makes recommendations to the
Board concerning compensation of officers and employees. The members of the
Audit-Finance Committee, who are appointed annually, consist of Messrs. Burger,
Mooney, Newland and Wenner. Messrs. Pfischner and McCarthy, as ex-officio
members, attend but do not vote at the meetings. Mr. Newland currently serves as
Chairman of this committee. The Audit-Finance Committee met four times during
fiscal 1997.
The Site-Building Committee inspects, evaluates and recommends to the Board
proposed sites for branch offices and recommends any major repairs and/or
additions to such proposed sites that may be necessary. The members of the
Site-Building Committee, who are appointed annually, consist of Messrs. Burger,
Mooney, Newland and Wenner. Messrs. Pfischner and McCarthy, as ex-officio
members, attend but do not vote at the meetings. Mr. Wenner currently serves as
Chairman of this committee. The Site-Building Committee met three times during
fiscal 1997.
Certain directors also serve as trustee/administrators of the Corporation's
benefit plans as follows: 401(k) Plan, Messrs. McCarthy, Newland and Pfischner;
Employee Stock Ownership Plan, Messrs. Mooney, Newland and Pfischner; and Stock
Option Plans, Messrs. Burger, Mooney, Pfischner and Wenner. To date, the
directors serving as trustees/administrators of such plans have not received any
additional compensation for such services.
COMPENSATION OF DIRECTORS
Board members receive an annual retainer, payable monthly, and a fee for
each meeting attended. For the first six months of fiscal year 1997, the
annualized retainer was $13,200 ($1,100 paid monthly) and the per meeting fee
attended was $400. Effective January 1, 1997, the directors received a retainer
of $1,200 monthly, based on an annualized retainer of $14,400, and $450 for each
meeting attended. Mr. McCarthy does not receive the annual retainer and meeting
fees. Directors, excluding Messrs. Pfischner and McCarthy, received $200 for
each committee meeting attended during fiscal 1997, except for the chairmen of
the Audit-Finance and Site-Building committees, who received $225 per meeting
attended. In addition to the normal $225 per meeting fee for fulfilling his
duties as Chairman of the Site-Building Committee, Mr. Wenner also receives $50
for inspecting and evaluating a proposed branch site and any major repairs to a
branch office or site. Mr. Wenner made nine inspections/evaluations during
fiscal 1997 and received a total of $450 for performing such services.
On December 16, 1993, the Bank entered into a consulting agreement with Mr.
Pfischner to serve as a consultant to the President-Chief Executive Officer,
Board of Directors and executive staff of the Bank for a term of one year
commencing on January 1, 1994 and continuing for one year from year to year by
written agreement. The agreement was extended by written agreement under the
same terms and conditions for a term of one year commencing on
7
<PAGE> 10
January 1, 1995, 1996 and 1997. The agreement provided for a minimum base annual
fee of $19,800 payable monthly, which may be increased in the future. Such fee
was increased to $20,400 effective January 1, 1997. Either party may terminate
the agreement by providing the other party with at least thirty days written
notice before the expiration date of the agreement. Mr. Pfischner had performed
consulting services to the Bank for many years without a written agreement. For
services performed during fiscal 1997, Mr. Pfischner received $34,100 which
included a bonus of $14,000 for outstanding services to the Bank in addition to
the regular Board fees.
Under the 1993 Directors' Stock Option Plan, each person who serves as a
non-employee director immediately following the last adjournment of each Annual
Meeting shall be granted as of such date a compensatory stock option to purchase
shares of the Corporation's Common Stock at a price equal to the fair market
value of a share of the Common Stock on that date. On the 1996 Annual Meeting
date, each non-employee director received an option to purchase 2,441 shares.
The fair market value on the October 24, 1996 Annual Meeting date was $24.875
per share.
Directors may make an irrevocable election prior to the beginning of each
calendar year to defer all or a portion of the annual retainer and meeting fees
into a cash account and/or a PFC stock account. The cash account earns interest
each year at a rate equal to the rate paid on the Bank's highest rated
certificate of deposit on the first business day of each calendar year. The
stock account is credited with the dividends paid on PFC stock during the year.
Prior to the beginning of the year, each participant may elect to purchase PFC
Common Stock with the cash in either account. Effective January 1, 1997, a third
deemed investment option was added to earn the performance rate of any of the
selected mutual funds offered by CIGNA to participants of the Bank's 401(k)
Plan. At the end of each quarter, the account is credited with gains (or debited
for losses) in accordance with the mutual fund experience reports provided by
CIGNA. Participants may receive payments from their accounts on a designated
date after January 1, 1998, on the attainment of an age after 65 or at
termination of Board service in cash, in either a lump sum or annual
installments, or receive the Common Stock.
EXECUTIVE MANAGEMENT
The following table sets forth certain information with respect to
executive officers of the Corporation and the Bank who are not directors of the
Corporation. There are no arrangements or understandings between the Corporation
or the Bank and any person pursuant to which such person has been appointed an
executive officer. No executive officer is related to any other executive
officer or director of the Corporation or the Bank by blood, marriage or
adoption. Officers of the Corporation and the Bank are appointed annually by the
respective Boards of Directors for one-year terms.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING
NAME AGE THE PAST FIVE YEARS
- ---------------------- --- ---------------------------
<S> <C> <C>
Timothy G. Rubritz 43 Vice President-Treasurer of the Corporation since its
organization in August 1987; Senior Vice President-
Treasurer of the Bank since December 1989; Vice President-
Treasurer from January 1986 to December 1989; joined the
Bank in June 1985 as audit director; with Coopers &
Lybrand from 1976 to 1985, including a general practice
manager at such firm from 1982 to 1985.
</TABLE>
8
<PAGE> 11
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION DURING
NAME AGE THE PAST FIVE YEARS
- ---------------------- --- ---------------------------
<S> <C> <C>
Bruce C. Gilleylen 51 Vice President of the Corporation since October 1995;
Senior Vice President and Chief Lending Officer of the
Bank since December 1989; Vice President from March 1986
to December 1989; joined the Bank in January 1986; with
Equibank from 1982 to 1985, including a Senior Vice
President thereof from 1984 to 1985.
Steven A. Friedman 47 Vice President of the Corporation since October 1995;
Senior Vice President of the Bank since December 1990;
Audit-Compliance Officer of the Corporation and the Bank;
Vice President from September 1986 to December 1990;
joined the Bank in July 1986; with the Federal Home Loan
Bank of Pittsburgh for six years serving as Vice
President- Supervision, Assistant Vice President and
Supervisory Analyst.
Robert J. Scuticchio 61 Senior Vice President of the Bank from December 1996 until
his retirement on April 30, 1997; in charge of branch
operations since 1975; Vice President prior to December
1996; served in various capacities with the Bank since
1970.
Gail A. Bieri 45 Vice President of the Bank since December 1992 in charge
of Human Resources Department and Marketing, and Assistant
Corporate Secretary since July 1990; Senior Assistant Vice
President from December 1991 to December 1992; Assistant
Vice President from December 1989 to December 1991; joined
the Bank in August 1989 as Director of Human Resources;
with Lyman Savings & Loan Association from 1976 to August
1989, serving as Executive Vice President from 1987 to
August 1989.
Nancy E. Kelly 48 Vice President of the Bank since December 1996; in charge
of branch operations since May 1997; Senior Assistant Vice
President from December 1991 to December 1996; Assistant
Vice President from December 1990 to December 1991. Joined
the Bank in December 1989.
Charles M. Murslack 43 Vice President of the Bank since December 1991; Assistant
Vice President from June 1988 to December 1991;
responsible for data processing systems; joined the Bank
in January 1988; with Mellon Bank from 1975 to January
1988.
Thomas R. Ondek 38 Vice President of the Bank since December 1989 in charge
of Savings/Checking Department; Assistant Vice President
from December 1986 to December 1989; branch manager from
April to December 1985; joined the Bank in May 1984.
Robert A. Stephens 42 Vice President of the Bank in charge of Mortgage
Department since December 1989; Assistant Vice President
from November 1984 to December 1989; joined the Bank in
August 1981 as a loan officer.
</TABLE>
AUDIT-FINANCE COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
PFC's business consists primarily of the business of the Bank and its
subsidiaries. The financial results of PFC are a direct function of the Bank's
achievement of its goals as set forth
9
<PAGE> 12
in its long-term strategic plan. Executives are compensated for their
contribution to the achievement of these goals, which benefits the stockholders,
customers, employees and communities in which the Bank operates.
PFC's Audit-Finance Committee is comprised of four outside directors of
PFC, which are the same directors who make up the Bank's Audit-Finance
Committee. The Audit-Finance Committees of the Bank and PFC ("Committee")
jointly administer executive compensation, with all compensation currently paid
by the Bank. The Committee reviews all issues pertaining to executive
compensation and submits its recommendations to the full Board of Directors for
approval. Mr. Robert J. McCarthy, Jr., in his capacity as a member of the Board
of Directors of PFC and the Bank, abstains from any Board of Directors' vote
concerning compensation affecting himself. The Committee's compensation program
for executive officers currently consists of annual payments of salary and
bonuses and periodic grants of options to purchase Common Stock under PFC's
Stock Option Plans. Each element of the program has a different purpose. Salary
and bonus payments are mainly designed to reward current and past performance.
Stock option awards are designed to help attract and retain superior personnel
for positions of substantial responsibility as well as to provide additional
incentive to contribute to the long-term success of PFC.
In determining the amount and form of executive compensation to be paid or
awarded in fiscal 1997, the Committee considered PFC's overall performance over
a period of years--and its future objectives and challenges--rather than a
guideline or formula based on any particular performance measure in a single
year. Within this framework, the Committee considered, among other things, the
following performance factors in making its compensation decisions in fiscal
1997: return on equity; earnings per share; fair market value of the Common
Stock; and the Bank's achievement of its annual goals relating to earnings,
growth, net worth, asset quality, efficiency ratio and evaluation by regulators
as to safety and soundness. The Committee's decisions concerning the
compensation of individual executive officers during fiscal 1997 were made in
the context of historical practice and competitive environment, including
comparisons with compensation practices of companies of similar size and
function in the financial services industry. The Committee has not addressed the
adoption of a policy with respect to the issue of the deductibility of
qualifying executive compensation under Section 162(m) of the Internal Revenue
Code of 1986, as amended ("Code") because no executive has compensation subject
to Section 162(m) that exceeds the $1,000,000 threshold.
Supplemental non-qualified benefit plans are provided to executive officers
as follows:
Supplemental Executive Benefit Plan
Effective December 31, 1994, PFC and the Bank adopted the Supplemental
Benefit Plan ("SEBP") for the benefit of certain officers who are subject to the
limitations imposed by Sections 401(a)(17) and 415 of the Code on the maximum
amount of compensation which may be taken into consideration for the purposes of
the Parkvale Financial Corporation Employee Stock Ownership Plan ("ESOP") and
the maximum amount of benefits which may be allocated to an individual
participant thereunder. In calendar year 1994, the maximum amount of base pay
for qualified benefit plan purposes was reduced to $150,000 from $235,840
previously, depriving persons earning more than $150,000 of retirement funds
otherwise available to them. The officers affected by the Code limitation in
calendar year 1996 were Messrs. McCarthy, Gilleylen and Rubritz. Treasury shares
of PFC Common Stock applicable to the 1996 distribution were allocated to the
Trust administered by Heritage Trust Company for their benefit as follows: 1,526
shares for Mr. McCarthy, 79 shares for Mr. Gilleylen and 73 shares for Mr.
Rubritz. The value of those shares, based upon the closing price of $26.00 per
share on the last trading day of calendar 1996 (December 30, 1996), is included
in the Summary Compensation Table.
10
<PAGE> 13
Executive Deferred Compensation Plan
Due to benefit limits imposed by the Code and/or discrimination tests of
highly compensated employees, the Bank adopted, effective July 1, 1994, the
Parkvale Savings Bank Executive Deferred Compensation Plan ("EDCP") for certain
senior officers of the Bank to compensate such individuals who participate in
the 401(k) Plan for benefits lost under the Plan. The EDCP is an unfunded,
non-qualified plan which provides for the accrual of matching contributions and
investment returns that may not be accrued under the 401(k) Plan. Under the
401(k) Plan, participating employees may voluntarily make pre-tax contributions
to their accounts up to 12% of covered annual salary. The Bank matches 50% of
the employee's pre-tax contributions up to a maximum of 6% of the employee's
salary for an effective Bank matching contribution of up to 3% of the employee's
salary. In addition, the Bank may make a profit sharing contribution equal to a
percentage of each eligible employee's covered compensation during a plan year,
subject to the Bank's profitability and the discretionary approval of the Board
of Directors. The historical discretionary contribution has been 2%.
BASES FOR CHIEF EXECUTIVE OFFICER AND NAMED EXECUTIVE OFFICERS COMPENSATION
In fiscal 1997, PFC's President and Chief Executive Officer received total
cash payments of $462,000 in salary and bonus (as shown in the Summary
Compensation Table). The Committee notes that Mr. McCarthy's salary in fiscal
1997 was less than 3% higher than his salary in fiscal 1996, and that increased
bonuses have been paid to him as PFC's overall performance continued to improve.
The bonus paid to Mr. McCarthy in fiscal 1997 was the same as in fiscal 1996 and
exceeded 76% of his salary for the year, as PFC achieved record levels of
operating income. The other executive officers named in the Summary Compensation
Table have received increased bonuses in the last five years, both on a dollar
basis and as a percentage of salary. The bonuses paid to Messrs. Rubritz,
Gilleylen and Friedman in fiscal 1997 exceeded 37% of their respective salaries
for the year.
The Committee considered these 1997 payments appropriate in light of PFC's
earnings and inherent stockholder value. In addition, the Committee determined
Mr. McCarthy's fiscal 1997 compensation based on its assessment of his ability
and dedication to enhance the long-term value and financial strength of PFC by
continuing to provide the leadership and vision that he has provided throughout
his tenure as Chief Executive Officer. As of June 30, 1997, PFC's market value
has increased by 743% on a per share basis since the Bank's conversion from the
mutual to the stock form of ownership in July 1987. This performance is further
highlighted on the following Five-Year Performance Graph, which compares PFC's
stock performance with the stock performance of other companies as measured by
broad indices.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1997, no member of the Audit-Finance Committee was a former
or current full-time officer or employee of the Corporation or any of its
subsidiaries. However, George W. Newland held an honorary title of Vice
President of the Bank from 1968 to 1989.
AUDIT-FINANCE COMMITTEE
<TABLE>
<S> <C>
Fred P. Burger, Jr. George W. Newland
Paul A. Mooney Warren R. Wenner
</TABLE>
11
<PAGE> 14
PERFORMANCE GRAPH
The following table and graph compares the yearly cumulative total return
of the Common Stock over a five-year measurement period with (i) the yearly
cumulative total return on the stocks included in the Nasdaq Market Index and
(ii) the yearly cumulative total return on the stocks included in the Nasdaq
Financial Stock Market Index as reported by the Center for Research in
Securities Prices at the University of Chicago. All of these cumulative returns
are computed assuming the reinvestment of dividends at the frequency with which
dividends were paid during the applicable years. The per share amounts have been
adjusted to reflect the 5 for 4 stock splits in October 1993, 1994, 1995 and
1996.
TABLE OF CUMULATIVE VALUES
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Parkvale..................... $ 100.00 $ 172.68 $ 236.83 $ 258.22 $ 313.38 $ 437.36
Nasdaq....................... 100.00 125.76 126.97 169.48 217.59 264.61
Nasdaq Financial............. 100.00 131.42 148.36 169.62 220.78 322.98
Book Value Per Share......... 10.50 11.87 13.25 15.25 17.25 18.54
Market Value Per Share....... 6.96 11.78 15.87 16.96 20.20 27.63
</TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
<TABLE>
<CAPTION>
MEASUREMENT PERIOD
(FISCAL YEAR COVERED) PARKVALE NASDAQ NASDAQ FINANCIAL
<S> <C> <C> <C>
1992 100.00 100.00 100.00
1993 172.68 125.76 131.42
1994 236.83 126.97 148.36
1995 258.22 169.48 169.62
1996 313.38 217.59 220.78
1997 437.36 264.61 322.98
</TABLE>
* Assumes the investment of $100 on June 30, 1992 and the reinvestment of all
dividends.
Market value on the record date, August 25, 1997, was $29.375 per share.
12
<PAGE> 15
EXECUTIVE COMPENSATION
SUMMARY
The following table sets forth a summary of certain information concerning
the compensation awarded or paid for services rendered in all capacities during
the last three fiscal years to the Chief Executive Officer and other executive
officers of the Corporation and the Bank ("Named Executive Officers") whose
total compensation during the last fiscal year exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
NAME AND PRINCIPAL --------------------- ------------- ALL OTHER
POSITION FISCAL YEAR SALARY(1) BONUS OPTION AWARDS COMPENSATION(2)(3)
- ------------------------ ----------- --------- -------- ------------- ------------------
<S> <C> <C> <C> <C> <C>
Robert J. McCarthy, Jr. 1997 $262,000 $200,000 0 $ 87,787
President and Chief 1996 256,000 200,000 0 83,491
Executive Officer 1995 242,500 175,000 0 68,951
Timothy G. Rubritz 1997 120,600 45,000 0 37,507
Vice President- 1996 118,800 44,000 0 36,026
Treasurer of the 1995 115,800 40,000 0 29,975
Corporation and Senior
Vice President-
Treasurer of the Bank
Bruce C. Gilleylen 1997 122,400 46,000 0 37,747
Vice President of the 1996 119,400 44,000 0 36,050
Corporation, Senior 1995 115,800 40,000 0 29,978
Vice President and
Chief Lending Officer
of the Bank
Steven A. Friedman 1997 89,400 38,000 0 27,430
Vice President of the 1996 86,400 35,000 0 25,730
Corporation, Senior 1995 82,800 30,000 0 21,113
Vice President of the
Bank and Audit-
Compliance Officer of
the Corporation and
the Bank
</TABLE>
- ---------
(1) Salary includes amounts deferred at the election of the executive officer
through the Bank's 401(k) Plan and Executive Deferred Compensation Plan
("EDCP").
(2) Includes the Bank's contributions to the 401(k) Plan and EDCP during fiscal
1997 on behalf of Mr. McCarthy ($12,819), Mr. Rubritz ($6,018), Mr.
Gilleylen ($6,095), and Mr. Friedman ($4,446).
(3) Includes the value of the Common Stock allocated to the ESOP and SEBP Trust
accounts of Messrs. McCarthy ($74,968), Rubritz ($31,489), Gilleylen
($31,652) and the ESOP account of Mr. Friedman ($22,984), based upon the
closing price of $26.00 per share on the allocation date, December 31, 1996.
The column "Other Annual Compensation" has been omitted because there is no
compensation required to be reported in such column. The aggregate amount of
perquisites and other personal benefits provided to each Named Executive Officer
did not exceed the lesser of $50,000 or 10% of the total annual salary and bonus
of such officer.
13
<PAGE> 16
OPTION GRANTS IN THE LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS GRANTED EXERCISE OR GRANT DATE
OPTIONS TO EMPLOYEES IN BASE PRICE PER EXPIRATION PRESENT
NAME GRANTED FISCAL YEAR SHARE DATE VALUE(1)(2)
- ----------------------- ---------- --------------- -------------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Robert J. McCarthy, Jr. 18,000 21.69 $25.50 12/17/2006 $115,560
Timothy G. Rubritz 6,000 7.23 25.50 12/17/2006 38,520
Bruce C. Gilleylen 6,000 7.23 25.50 12/17/2006 38,520
Steven A. Friedman 6,000 7.23 25.50 12/17/2006 38,520
</TABLE>
- ---------
(1) The estimated value shown, which was determined by application of the
Black-Scholes option pricing model, was developed solely for comparative
disclosure in accordance with the regulations of the Securities and Exchange
Commission and does not necessarily reflect PFC's view of the appropriate
value or methodology for financial reporting. Use of this model should not
be viewed in any way as a forecast of the future performance of the Common
Stock, volatility or dividend policy. No adjustments have been made for
forfeitures or non-transferability.
(2) The estimated present value of the options is $6.42 per share and is based
upon historical experience. The assumptions used in calculating the option
value are as follows: Volatility of .157, calculated using monthly stock
prices for the three and one half year period preceding the option award; a
risk-free rate of interest of 6.41%, representing the interest rate on a
United States Treasury Note with a maturity date corresponding to the
expected term of the options; a dividend yield of 1.80%, the average yield
for the previous three fiscal years; a stock price at date of grant of
$25.50, which is equal to the exercise price; and an expected option term of
six years.
AGGREGATED OPTION EXERCISES IN THE LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth certain information concerning stock options
exercised during fiscal year 1997 by the Named Executive Officers and the value
of unexercised stock options held by each such officer at fiscal year end (June
30, 1997). The number of shares have been adjusted to reflect the 5 for 4 stock
splits in October 1993, 1994, 1995 and 1996.
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING
UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS
YEAR END AT FISCAL YEAR END
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED(1) UNEXERCISABLE UNEXERCISABLE(2)
- ------------------------- --------------- ----------- ------------------ --------------------
<S> <C> <C> <C> <C>
Robert J. McCarthy, Jr. 18,945 $ 421,019 53,921/9000 $ 894,443/21,938
Timothy G. Rubritz 8,457 212,255 20,577/3000 328,888/ 7,313
Bruce C. Gilleylen -0- -0- 10,812/3000 99,575/ 7,313
Steven A. Friedman -0- -0- 19,356/3000 300,209/ 7,313
</TABLE>
- ---------
(1) The value was determined by subtracting the exercise price from the fair
market value of the Common Stock on the exercise date.
(2) The value was determined by subtracting the exercise prices from the fair
market value of the Common Stock on June 30, 1997 ($27.9375 per share) and
multiplying the same by the number of options.
14
<PAGE> 17
LONG-TERM INCENTIVE PLANS--AWARDS IN THE LAST FISCAL YEAR
A long-term incentive plan has not been instituted for either the
Corporation or the Bank.
EMPLOYMENT AGREEMENTS
The Bank entered into a five-year employment agreement with Mr. McCarthy in
April 1987 and the Corporation became a party to the agreement upon consummation
of the reorganization of the Bank into the holding company form of organization
in January 1989. The initial term of the agreement was extended automatically
for an additional year on each anniversary date of the agreement. Effective
January 1, 1997, a new five-year employment agreement was entered into by the
parties to reflect the holding company formation, the Bank's charter conversion
to a savings bank and change in regulators, and changes in applicable law and
regulatory policies since 1987. The agreement provides for a minimum annual
salary of $262,000, which may be increased from time to time in such amounts as
may determined by the Boards of Directors of the Corporation and the Bank. In
addition, Mr. McCarthy may receive bonus payments as determined by the Boards of
Directors. Prior to the first anniversary of the effective date and each annual
anniversary thereafter, the Boards of Directors shall consider all relevant
factors, including Mr. McCarthy's performance, and if appropriate approve a
one-year extension of the remaining term of the agreement. The term of Mr.
McCarthy's agreement will be extended each year if the Boards of Directors of
the Bank and the Corporation ("Parkvale") approve the extension, unless Mr.
McCarthy provides at least 30 days written notice not to extend the agreement
beyond its remaining term. The agreement is terminable by Parkvale for cause at
any time.
The agreement with Mr. McCarthy provides for severance payments and other
benefits in the event Parkvale terminates his employment without cause or Mr.
McCarthy resigns for "good reason," as defined in the agreement. Good reason
includes among other things a "change in control" of Parkvale, which is defined
to include any of the following: (1) any change in control required to be
reported pursuant to Item 6(e) of Schedule 14A promulgated under the Exchange
Act; (2) the acquisition of beneficial ownership by any person (as defined in
Sections 13(d) and 14(d) of the Exchange Act) of 10% or more of the combined
voting power of the Corporation's then outstanding securities; or (3) within any
period during the term of the agreement, a change in the majority of the Board
of Directors for any reason without the written consent of Mr. McCarthy. In such
event, Parkvale will give severance payments to Mr. McCarthy equal to 2.99 times
his average annual base salary, bonus and other incentive compensation for the
preceding three years, plus the continuation or payment of certain fringe
benefits other than stock benefit plans. Under Mr. McCarthy's employment
agreement, Mr. McCarthy could receive payments and benefits that constitute a
parachute payment. Parachute payments generally are payments in excess of three
times the base amount, which is defined to mean the recipient's average annual
compensation from the employer includible in the recipient's gross income during
the most recent five taxable years ending before the date on which a change in
control of the employer occurred. Recipients of parachute payments are subject
to a 20% excise tax on the amount by which such payments exceed the base amount,
in addition to regular income taxes, and payments in excess of the base amount
are not deductible by the employer as compensation expense for federal income
tax purposes. In such event, Parkvale has agreed to pay the 20% excess tax that
would otherwise be owed by Mr. McCarthy and such additional amounts as may be
necessary to reimburse Mr. McCarthy for the federal, state and local income
taxes and excise taxes on such amounts.
The agreement also precludes Mr. McCarthy from owning (excluding the
ownership of 1% or less of the stock of a public corporation), managing,
operating and controlling, being employed by or participating in or being in any
way connected with any other business covered by federal deposit insurance which
is located in the Pennsylvania counties of Allegheny, Armstrong, Butler, Beaver,
Washington and Westmoreland. Such restriction shall continue throughout Mr.
McCarthy's employment with Parkvale.
15
<PAGE> 18
The employment agreement with Mr. McCarthy, to the extent it increases the
cost of any acquisition of control of the Corporation, could be deemed to have
an anti-takeover effect. As a result, the agreement may discourage takeover
attempts which (1) are deemed by certain stockholders to be in their best
interests, (2) might be at prices in excess of the then market value of the
Corporation's Common Stock, and (3) as a result, may tend to perpetuate existing
management.
LOANS TO MANAGEMENT
No executive officer applied for or was granted a loan during fiscal 1997.
All loans outstanding to executive officers during fiscal 1997 were made on
substantially the same terms, including interest rate and collateral, as those
prevailing at the time the loans were granted for comparable transactions with
unaffiliated persons, and the loans did not involve more than the normal risk of
collectability or present other unfavorable features.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed Ernst & Young LLP as independent
auditors for the year ending June 30, 1998, and has further directed that the
selection of such auditors be submitted for ratification by the stockholders at
the Annual Meeting. The Corporation has been advised by Ernst & Young LLP that
neither the firm nor any of its associates has any relationship with the
Corporation or its subsidiaries other than the usual relationship that exists
between independent certified public accountants and clients. Ernst & Young LLP
will have a representative at the Annual Meeting who will have an opportunity to
make a statement, if he or she so desires, and who will be available to respond
to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE
RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP
AS INDEPENDENT AUDITORS FOR FISCAL 1998.
STOCKHOLDER PROPOSALS
Any proposal which a stockholder wishes to have presented at the next
Annual Meeting of Stockholders to be held in October 1998, must be received at
the main office of the Corporation no later than May 20, 1998. If such proposal
is in compliance with all of the requirements of Rule 14a-8 of the Exchange Act,
it will be included in the Proxy Statement and set forth on the form of proxy
issued for the next Annual Meeting of Stockholders. It is urged that any such
proposals be sent by certified mail, return receipt requested.
16
<PAGE> 19
ANNUAL REPORTS AND FINANCIAL STATEMENTS
A copy of the Corporation's Annual Report to Stockholders for the year
ended June 30, 1997 accompanies this Proxy Statement. Such annual report is not
part of the proxy solicitation materials.
UPON RECEIPT OF A WRITTEN REQUEST, THE CORPORATION WILL FURNISH TO ANY
STOCKHOLDER WITHOUT CHARGE A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM
10-K FOR THE YEAR ENDED JUNE 30, 1997 AND A LIST OF THE EXHIBITS THERETO
REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE
EXCHANGE ACT. SUCH WRITTEN REQUEST SHOULD BE DIRECTED TO TIMOTHY G. RUBRITZ,
TREASURER, PARKVALE FINANCIAL CORPORATION, 4220 WILLIAM PENN HIGHWAY,
MONROEVILLE, PENNSYLVANIA 15146. THE FORM 10-K IS NOT PART OF THE PROXY
SOLICITATION MATERIALS.
OTHER MATTERS
Each proxy solicited hereby also confers discretionary authority on the
Board of Directors of the Corporation to vote the proxy with respect to the
approval of the minutes of the last meeting of stockholders, the election of any
person as director if the nominee is unable to serve or for good cause will not
serve, matters incident to the conduct of the meeting, and upon such other
matters as may properly come before the Annual Meeting. Management is not aware
of any business to come before the Annual Meeting other than those matters
described above in this Proxy Statement. However, if any other matters should
properly come before the Annual Meeting, it is intended that proxies solicited
hereby will be voted with respect to those other matters in accordance with the
judgment of the persons voting the proxies.
The cost of solicitation of proxies will be borne by the Corporation. The
Corporation will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of the Corporation's Common Stock. In addition to
solicitations by mail, directors, officers and employees of Parkvale may solicit
proxies personally or by telephone without additional compensation. The
Corporation may retain a proxy soliciting firm to assist in the solicitation of
proxies. The cost of such a firm would not be expected to exceed $3,500.
By Order of The Board of Directors
/s/ ERNA A. GOLOTA
Erna A. Golota,
Secretary
September 15, 1997
17
<PAGE> 20
REVOCABLE PROXY
PARKVALE FINANCIAL CORPORATION
[ X ] PLEASE MARK VOTES
AS IN THIS EXAMPLE
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, being a stockholder of the Corporation, hereby authorizes
the Board of Directors of the Corporation as proxies with full powers of
substitution to represent the undersigned at the Annual Meeting of Stockholders
of the Corporation to be held at the Pittsburgh Athletic Association, 4215 Fifth
Avenue, Pittsburgh, Pennsylvania, on October 23, 1997, at 10:00 a.m. Eastern
Time, and at any adjournment of said meeting, and thereat to act with respect to
all votes that the undersigned would be entitled to cast if then personally
present on all proposals coming before the meeting.
This proxy may be revoked at any time before it is exercised.
FOR ALL
1. Election of Directors: FOR WITHHOLD EXCEPT
[ ] [ ] [ ]
NOMINEES:
ROBERT D. PFISCHNER
PAUL A. MOONEY
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK
"FOR ALL EXCEPT" AND WRITE THAT NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.
- -----------------------------------------------------------------------------
FOR AGAINST ABSTAIN
2. Appointment of Ernst & Young LLP [ ] [ ] [ ]
as the Corporation's independent
auditors for fiscal 1998.
3. In the proxies' discretion, such other business as may
properly come before the meeting.
SHARES OF COMMON STOCK OF THE CORPORATION WILL BE VOTED AS SPECIFIED. IF NO
SPECIFICATION IS MADE, SHARES WILL BE VOTED FOR THE ELECTION OF THE BOARD OF
DIRECTORS' NOMINEES TO THE BOARD OF DIRECTORS, FOR PROPOSAL 2 AND OTHERWISE AT
THE DISCRETION OF THE PROXIES.
Please sign exactly as name appears on this proxy card. When shares are held
by joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by the President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
-------------------
Please be sure to sign and date Date
this Proxy in the box below.
- ------------------------------------------------------------------
- ----Shareholder sign above-------Co-holder (if any) sign above----
* DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE PAID ENVELOPE PROVIDED. *
PARKVALE FINANCIAL CORPORATION
- ------------------------------------------------------------------------------
PLEASE ACT PROMPTLY-
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
- -------------------------------------------------------------------------------
