SUMMIT LIFE CORPORATION.
3021 Epperly Dr.
Del City, Oklahoma 73115
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 11, 2000
TO OUR STOCKHOLDERS:
The 2000 Annual Meeting of Stockholders of Summit Life Corporation., an
Oklahoma corporation (the "Company"), will be held at Willow Creek Golf and
Country Club, 6501 S. Country Club Dr., Oklahoma City, Oklahoma, on May 11,
2000, at 10:00 a.m., local time, for the following purposes:
1. To elect one director;
2. To consider a proposal to ratify the appointment of Grant Thornton LLP
as independent auditors of the Company for 2000; and
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
Stockholders of record at the close of business on April 6, 2000 are
entitled to notice of and to vote at the Annual Meeting. A complete list of the
stockholders entitled to vote at the Annual Meeting will be available for
examination by any stockholder at the Company's executive offices, during
ordinary business hours, for a period of at least ten days prior to the Annual
Meeting.
The accompanying Proxy Statement contains information regarding the
matters to be considered at the Annual Meeting. For reasons outlined therein,
the Board of Directors recommends a vote "FOR" the matters being voted upon.
YOUR PROXY IS IMPORTANT TO ASSURE A QUORUM AT THE ANNUAL MEETING.
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE BE SURE THAT THE
ENCLOSED PROXY IS PROPERLY COMPLETED, DATED, SIGNED AND RETURNED WITHOUT DELAY
IN THE ENCLOSED ENVELOPE. IT REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
BY ORDER OF THE BOARD OF DIRECTORS,
/S/ James L. Smith
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James L. Smith,
Chairman of the Board of Directors and
Chief Executive Officer
Del City, Oklahoma
April 10, 2000
<PAGE>
SUMMIT LIFE CORPORATION
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PROXY STATEMENT
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ANNUAL MEETING OF STOCKHOLDERS
To Be Held On May 11, 2000
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Summit Life Corporation., an Oklahoma
corporation (the "Company"), for use at the Annual Meeting of Stockholders of
the Company (the "Annual Meeting") to be held on the date, at the time and place
and for the purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders, and any adjournment of the Annual Meeting.
This Proxy Statement and accompanying form of proxy, along with the
Company's Annual Report for its fiscal year ended December 31, 1999, are first
being mailed to holders of the Company's common stock on or about April 10,
2000. Please refer to the Annual Report for financial information concerning the
activities of the Company.
The Board of Directors has established April 6, 2000 as the record date
(the "Record Date") to determine stockholders entitled to notice of and to vote
at the Annual Meeting. At the close of business on the Record Date, 2,267,605
shares of common stock were outstanding. Each share is entitled to one vote. The
holders of a majority of the outstanding common stock, present in person or by
proxy, will constitute a quorum for the transaction of business at the Annual
Meeting.
Each proxy that is properly signed, dated and returned to the Company
in time for the Annual Meeting, and not revoked, will be voted in accordance
with instructions contained therein. If no contrary instructions are given,
proxies will be voted "FOR" each of the proposals submitted to a vote of the
stockholders. You may revoke your proxy at any time prior to its exercise by
delivering a written notice of revocation or a later dated proxy to the
Secretary of the Company or, if you are present at the Annual Meeting, you may
revoke your proxy and vote in person.
Election of the director nominees will be by plurality vote. The
Company's Secretary will appoint an inspector of election to tabulate all votes
and to certify the results of all matters voted upon at the Annual Meeting.
Votes withheld from nominees for director, abstentions and broker non-votes will
be counted for purposes of determining whether a quorum has been reached. Votes
withheld from nominees for director and abstentions on proposals have the same
effect as votes against them. Broker non-votes have no effect on the outcome of
the election of directors or other proposals.
The Company will bear the cost of soliciting the enclosed form of
proxy. In addition to solicitation by mail, officers, employees or agents of the
Company may solicit proxies personally, or by telephone, telegraph, facsimile
transmission or other means of communication. The Company will request banks and
brokers or other similar agents or fiduciaries to transmit the proxy material to
the beneficial owners for their voting instructions and will reimburse them for
their expenses in so doing.
<PAGE>
ELECTION OF DIRECTOR
(PROXY ITEM NO. 1)
Pursuant to provisions of the Company's Amended and Restated
Certificate of Incorporation (the "Certificate of Incorporation") and Bylaws,
the Board of Directors has fixed the number of directors at five. The
Certificate of Incorporation provides for three classes of directors serving
staggered three-year terms, with each class to be as nearly equal in number as
possible. Currently, the Board of Directors consists of the following
individuals: Randal M. Beach, Class 3 director with a term expiring at the 2000
annual meeting; James L. Smith and M. Dean Brown, Class 2 directors with terms
expiring at the 2001 annual meeting; and Charles L. Smith and Thomas D. Sanders,
Class 1 directors with terms expiring at the 2002 annual meeting. The Board of
Directors has nominated Michael P. Saunders as Class 3 director for a term
expiring at the 2003 annual meeting, and until his successor is elected and
qualified. Proxies cannot be voted for a greater number of persons than the
number of nominees named. Other directors who are remaining on the Board will
continue in office in accordance with their previous elections until the
expiration of their terms at the 2001 or 2002 annual meeting, as the case may
be.
The Board of Directors recommends a vote "FOR" the nominee for election
to the Board of Directors for the term so specified.
It is the intention of the persons named in the enclosed form of proxy
to vote such proxy for the election of the nominee named above. The Board of
Directors expects that the nominee will be available for election but, in the
event such nominee is not so available, proxies received will be voted for a
substitute nominee to be designated by the Board of Directors.
INFORMATION REGARDING NOMINEE AND DIRECTORS
The following information is furnished for each person who is nominated
for election as a director or who is continuing to serve as a director of the
Company after the Annual Meeting:
Nominee for Election as Class 3 Director for Term Expiring in 2003
Michael P. Saunders, age 57, has served as President of Saunders &
Company, a general insurance agency, since November 1973. Mr. Saunders is a
licensed life insurance agent in the State of Florida and earned the designation
of Chartered Life Underwriter from the American College in Bryn Mawr,
Pennsylvania. Mr. Saunders holds a Bachelors Degree from Georgia Institute of
Technology.
Directors Not Standing for Re-election
James L. Smith, age 60, co-founded the Company in April 1994 and served
as Chairman of the Board of Directors, President and Chief Executive Officer of
the Company until April 1998, at which time he was elected its Chairman of the
Board and Chief Executive Officer. Mr. Smith has served as Chairman of the Board
and President of the Smith Agency, an Oklahoma licensed insurance agency since
1980. Mr. Smith earned the designation of Chartered Life Underwriter and
Chartered Financial Consultant from the American College in Bryn Mawr,
Pennsylvania. Mr. Smith is the father of Charles L. Smith. Mr. Smith retired
from the Army Reserves as the Assistant Division Commander of the 95th Division,
Army Reserves, at the rank of Colonel (Brigadier General upon Mobilization).
M. Dean Brown, age 74, has served as director since April 1997. Prior
to Mr. Brown's retirement in December 1997, he practiced law at the law firm of
Green, Brown and Stark, an Oklahoma City law firm. He holds a bachelors degree
from the University of Oklahoma and earned his Juris Doctor from Oklahoma City
University. Mr. Brown is also a certified public accountant.
2
<PAGE>
Charles L. Smith, age 40, co-founded the Company in April 1994 and
served as Director, Vice President, Secretary and Treasurer from the Company's
inception in 1994 until April 1998, at which time he was elected President,
Chief Operating Officer and a director of the Company. Mr. Smith also serves as
President of Great Midwest Life Insurance Company, the Company's wholly owned
subsidiary. Mr. Smith is Vice President and a director of the Smith Agency. Mr.
Smith has been involved in the insurance industry for over 17 years. Mr. Smith
is the son of James L. Smith.
Thomas D. Sanders, age 59, has served as a director since April 1997.
He served as the Executive Vice President of Marketing for the Lomas Life Group
from 1986 to 1990 and as Executive Vice President for Union Life Insurance
Company between 1978 and 1990. Mr. Sanders currently serves as Chief Executive
Officer and director of ReUnion Marketing, Inc. He is a graduate of Oklahoma
State University.
EXECUTIVE OFFICERS
The executive officers of the Company include James L. Smith, Chief
Executive Officer of the Company; Charles L. Smith, President and Chief
Operating Officer of the Company; and Quinton L. Hiebert, Vice President and
Chief Financial Officer of the Company. Information about Messrs. Smith and
Smith, both of whom are also directors, is presented above under the heading
"Information Regarding Nominee AND DIRECTORs." Information regarding Mr. Hiebert
is set forth below.
Quinton L. Hiebert, age 40, has been employed by the Company since
March 1996, and was elected Vice President, Chief Financial Officer and
Secretary in April 1998. From October 1989 to March 1996, he was employed as
Chief Financial Analyst at the Oklahoma Department of Insurance. Mr. Hiebert
holds a bachelors degree from Bethel College, Kansas and earned his MBA from
Emporia State University, Kansas. Mr. Hiebert is a certified public accountant.
THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors held four meetings during the Company's fiscal
year ended December 31, 1999. The Board of Directors has a standing Compensation
Committee and an Audit Committee. The Board of Directors does not have a
nominating committee.
The Compensation Committee's functions include determining base
salaries, annual incentive bonus awards and other compensation awards to the
executive officers of the Company. Bonus amounts earned are based on the
attainment of budgeted performance and asset quality goals, as determined by an
objective review of the degree of attainment of such goals, as well as both an
objective and subjective review of the respective executive officer's
contribution thereto. Individual goals are established by the Board of Directors
in consultation with each executive.
Mr. James L. Smith serves as Chairman of the Compensation Committee,
and Messers Brown and Sanders comprise the remaining committee members. The
Compensation Committee met once during 1999.
The Audit Committee's functions include: (i) reviewing and recommending
to the Board of Directors (subject to stockholder approval) the independent
auditors selected to audit the Company's financial statements, including the
review and approval of the fees charged for all services by the independent
auditors; (ii) reviewing the scope of the annual audit plan; (iii) reviewing the
audited financial statements of the Company; (iv) reviewing the management
letter comments from the Company's independent auditors, including management's
responses and plans of action; (v) reviewing from time to time the Company's
general policies and procedures with respect to auditing, accounting and the
application of resources; (vi) reviewing any other matters and making special
inquiries and investigations referred to it by the Board of Directors; and (vii)
making other recommendations to the Board of Directors as the committee may deem
appropriate.
3
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<TABLE>
<CAPTION>
The Audit Committee, which is composed of James L. Smith, M. Dean Brown
and Thomas D. Sanders, met once during 1999.
Each director attended at least 75% of the total number of Board
meetings held while serving as a director during fiscal year 1999.
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The table below sets forth, as of April 6, 2000, the number and percentage
of outstanding shares of common stock beneficially owned by (i) each person who
is known by the Company to be the beneficial owner of more than 5% of the
Company's Common Stock which is the Company's only class of voting securities,
(ii) each of the Company's directors, (iii) the executive officer listed in the
Summary Compensation Table set forth under "EXECUTIVE COMPENSATION," and (iv)
all directors and executive officers of the Company as a group. Unless otherwise
noted, the persons named below have sole voting and investment power with
respect to such shares.
Common Stock
--------------------------------------------------
<S> <C> <C>
Name of Beneficial Holder Number of Shares Percent of Class
James L. Smith*(1) 694,985 30.65%
Charles L. Smith*(1) 698,235 30.79%
Randal M. Beach*(1) 820 (2)
Dean Brown*(1) 100,963 4.45%
Quinton L. Hiebert(1) 4,750 (2)
Thomas D. Sanders*(1) 2,318 (2)
All executive officers and directors as a group
(6 persons) 1,475,221 66.32%
</TABLE>
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* Director
(1) Address is c/o Summit Life Corporation, 3021 Epperly Drive, P.O. Box
15808, Del City, Oklahoma 73155.
(2) Less than 1%.
Compliance with Section 16(a) Beneficial Ownership Reporting Requirements
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's directors and executive officers and any persons who own more than 10%
of a registered class of the Company's equity securities to file with the
Securities and Exchange Commission ("SEC") reports of ownership and subsequent
changes in ownership of common stock and other securities of the Company.
Officers, directors and greater than 10% stockholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms they
file. Based solely on review of the copies of such reports furnished to the
Company or written representations that no other reports were required, the
Company believes that during 1999 all filing requirements applicable to its
officers, directors and greater than 10% beneficial owners were met
EXECUTIVE COMPENSATION
Set forth in the following table is information as to the compensation
paid to the Company's Chief Executive Officer for each of the three years ended
December 31, 1999. No officer or director of the Company received, during the
year ended December 31, 1999, total compensation in excess of $100,000.
4
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<TABLE>
<CAPTION>
Summary Compensation Table
Annual Compensation
-------------------
Name and Principal Position Year Salary Other
---- ------ -----
<S> <C> <C> <C>
James L. Smith, Chairman of the Board
and Chief Executive Officer 1999 12,000 3,326 (1)
1998 12,000 4,410 (1)
1997 9,770 3,000 (2)
</TABLE>
(1) Represents compensation attributable to Mr. Smith in connection with
personal use of a Company-furnished automobile and country club dues
paid by the Company for the benefit of Mr. Smith.
(2) Represents country club dues.
Stock Options Granted in Fiscal 1999
The Company does not have a stock option plan, nor have any stock
options been granted by the Company outside a plan.
Employment Agreements
In April 1997, the Company entered into employment agreements with
James L. Smith and Charles L. Smith, the Company's Chief Executive Officer and
President, respectively. The employment agreements provide, among other things,
for six-year terms, base and maximum salaries, salary increases subject to Board
of Directors approval, annual bonuses and benefits. For 1999, the Board of
Directors approved base salaries to James L. Smith of $12,000, and to Charles L.
Smith of $72,000. The amount of any bonus compensation payable to James L. Smith
or Charles L. Smith is determined by the Compensation Committee of the Board of
Directors, in accordance with criteria set by such committee; no bonus
compensation was granted for 1999.
The agreements may be terminated by mutual agreement, by the Company at
its sole discretion without cause, or by the Company for cause, as defined. If
the agreements are terminated for cause, severance payments of $50,000 are
payable to each employee. If the agreements are terminated without cause,
severance payments to each employee will be equivalent to the maximum salary
over the term of the agreement less amounts previously paid, but not less than
$360,000 for Charles L. Smith and $450,000 for James L. Smith.
Directors' Compensation
Directors of the Company are paid an annual stipend of $1,200 and a fee
of $100 for each meeting attended. Additionally, all directors receive
reimbursement of reasonable expenses incurred in attending Board and Committee
meetings and otherwise carrying out their duties.
Certain Transactions
During 1998, the Company funded a residential mortgage for Charles L.
Smith in the amount of $120,000, secured by a first security interest in such
residence. The promissory note was for a three-year term at an annual interest
rate of 6%, payable in monthly installments of principal and interest of $719,
with the principal balance due at the note's maturity in 2001. The note was paid
in full by Mr. Smith in December 1998.
Both James L. Smith and Charles L. Smith, as the original founders of
the Company, are considered "promoters" of the Company as such term is defined
under the Securities Act. The Company believes that any transactions entered
into between the Company and such persons have been on terms no less favorable
to the Company as those generally available from unaffiliated third parties. All
such transactions have been unanimously approved by the Board of Directors
which, during 1999, included two independent, nonaffiliated directors. All
future affiliated transactions and loans will be made or entered into on terms
that are no less favorable to the Company than those that can be obtained from
unaffiliated third parties and, in any event, must be approved by a majority of
the Company's independent directors.
5
<PAGE>
RATIFICATION OF INDEPENDENT AUDITORS
(PROXY ITEM NO. 2)
The Board of Directors has selected the firm of Grant Thornton LLP as
auditors to make an examination of the consolidated financial statements of the
Company for the year ending December 31, 2000.
The Board of Directors recommends you vote FOR the ratification of the
selection of Grant Thornton LLP as independent auditors for the ensuing year.
STOCKHOLDER PROPOSALS
At the annual meeting each year, the Board of Directors submits to
stockholders its nominees for election as directors. In addition, the Board of
Directors may submit other matters to the stockholders for action at the annual
meeting.
Stockholders of the Company also may submit proposals for inclusion in
the proxy material. These proposals must meet the stockholder eligibility and
other requirements of the Securities and Exchange Commission. In order to be
included in the Company's 2000 proxy material, a stockholder's proposal must be
received not later than December 8, 2000 by the Company at 3021 Epperly Dr., Del
City, Oklahoma 73115, Attention: Secretary.
In addition, the By-Laws provide that in order for business to be
brought before a stockholders' meeting, a stockholder must deliver written
notice to or mailed and received at the principal executive offices of the
Company not less than forty (40) days prior to the annual meeting; provided,
however, that in the event less than forty-five (45) days' notice or prior
public disclosure of the date of the annual meeting is given or made to
stockholders, notice by the stockholder must be so received not later than the
fifth day following the day on which such notice of the date of the annual
meeting was mailed or such disclosure was made, but not less than five days
prior to the annual meeting. A stockholder's notice to the Secretary shall set
forth (a) a brief description of the business to be brought before the annual
meeting and the reasons for conducting such business at the annual meeting, (b)
the name and address, as they appear on the Company's books, of the stockholder
proposing such business, (c) the class and number of shares of the Company which
are beneficially owned by the stockholder, (d) any material interest of the
stockholder in such business, and (e) a representation that the stockholder
intends to appear at the meeting in person or by proxy to submit the business
specified in such notice. Notwithstanding anything in the By-Laws to the
contrary, no business shall be conducted at a meeting except in accordance with
the procedures set forth in the By-Laws. The chairman of the annual meeting
shall, if the facts warrant, determine that business was not properly brought
before the annual meeting and in accordance with the provisions of Article II,
Section 12 of the By-Laws, and if he should so determine, he shall so declare to
the annual meeting and any such business not properly brought before the annual
meeting shall not be transacted.
In addition, nominations for the election of directors shall be made by
the Board of Directors or by any stockholder entitled to vote in the election of
directors generally. However, any stockholder entitled to vote in the election
of directors generally may nominate one or more persons for election as
directors at a meeting only if timely notice of such stockholder's intent to
make such nomination or stockholder's notice is delivered to or mailed and
received at the principal executive offices of the Company not fewer than forty
(40) days prior to the annual meeting, provided, however, that in the event that
less than forty-five (45) days' notice or prior public disclosure of the date of
the annual meeting is given or made to stockholders, notice by the stockholder
to be timely must be so received no later than the close of business on the
tenth day following the day on which such notice of the date of the annual
meeting was mailed or such public disclosure was made. Each notice shall set
6
<PAGE>
forth (a) the name and address of the stockholder who intends to make the
nomination and of the person or persons to be nominated; (b) a representation
that the stockholder is a holder of record of stock of the Company entitled to
vote for the election of directors on the date of such notice and intends to
appear in person or by proxy at the annual meeting to nominate the person or
persons specified in the notice; (c) a description of all arrangements or
understandings between the stockholder and each nominee and any other person or
persons (naming such person or persons) pursuant to which the nomination or
nominations are to be made by the stockholder; (d) such other information
regarding each nominee proposed by such stockholders as would be required to be
included in a proxy statement filed pursuant to the proxy rules of the
Securities and Exchange Commission, had the nominee been nominated, or intended
to be nominated, by the Board of Directors; and (e) the consent of each nominee
to serve as a director of the Corporation if so elected.
If the chairman of the annual meeting for the election of directors
determines that a nomination of any candidate for election as a director at such
meeting was not made in accordance with the applicable provisions of Article
III, Section 4 of the By-Laws, such nomination shall be void.
OTHER MATTERS
The Company's management does not know of any matters to be presented
at the Annual Meeting other than those set forth in the Notice of Annual Meeting
of Stockholders. However, if any other matters properly come before the Annual
Meeting, the persons named in the enclosed proxy intend to vote the shares to
which the proxy relates on such matters in accordance with their best judgment
unless otherwise specified in the proxy.
BY ORDER OF THE BOARD OF DIRECTORS
/S/ Quinton L. Hiebert
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April 10, 2000 Quinton L. Hiebert, Secretary
7
<PAGE>
SEE
REVERSE
SIDE
SUMMIT LIFE CORPORATION
Del City, Oklahoma
PROXY/VOTING INSTRUCTION CARD
This proxy is solicited on behalf of the Board of Directors for the Annual
Meeting on May 11, 2000.
The undersigned hereby appoints Charles L. Smith and James L. Smith, or either
of them, as proxies, each with full power of substitution, to attend the Annual
Meeting of Stockholders of SUMMIT LIFE CORPORATION, to be held on May 11, 2000,
at 10:00 a.m., local time, and at any adjournments thereof, and to vote as
specified in this Proxy all the shares of stock of the Company which the
undersigned would be entitled to vote if personally present.
P 1. Your vote for the election of Class 3 Director, nominee Michael P.
Saunders, may be indicated on the reverse.
R 2. Your vote to ratify the appointment of Grant Thornton LLP as
independent auditors of the Company for 2000 may be indicated on the
reverse.
O
Your vote is important! Please sign and date on the reverse and return
X promptly in the enclosed postage paid envelope.
Y Change of Address And/or Comments:
-----------------------------------
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(If you have written in the above space, please mark the "Comments" box on the
reverse of this card.)
<PAGE>
<TABLE>
Please mark your votes as in this example.
[X]
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no directions are indicated,
this proxy will be voted for proposals 1 and 2.
The Board of Directors recommends a vote FOR Proposals 1 and 2
<S> <C> <C> <C>
1. Election of Directors (see reverse) FOR WITHHELD
[ ] [ ]
2. Ratify appointment of Grant Thornton LLP (see reverse) FOR AGAINST ABSTAIN
[ ] [ ] [ ]
</TABLE>
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
[ ] Change of Address and Comments on Reverse Side
Note: Please sign exactly as name appears on
this card. Joint Owners should each sign
personally. Corporation proxies should be
signed by an authorized officer. Executors,
administrators, trustees, etc. should so
indicate when signing.
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SIGNATURE(S) DATE
