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The total number of pages contained herein is 16,
and the Exhibit Index is located at page 12.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. _______)*
PICO Holdings, Inc.
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
693366 10 6
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(CUSIP Number)
Michael Manire, D'Amato & Lynch,
70 Pine Street, New York, N.Y. 10270
(212) 269-0927
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(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
November 20, 1996
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(Date of Event which Requires Filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ ]. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule l3d-7.)
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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SCHEDULE 13D
- --------------------------------------- ----------------------------------
CUSIP NO. 719410 PAGE 2 OF 16 PAGES
---------------------- -------- --------
- --------------------------------------- ----------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
GUINNESS PEAT GROUP PLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
ENGLAND
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NUMBER OF 7 SOLE VOTING POWER
SHARES 6,366,365 (6,075,891 have been acquired, and 290,474
are subject to an option to acquire)
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING
PERSON --------------------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
6,366,365 (6,075,891 have been acquired, and 290,474
are subject to an option to acquire)
--------------------------------------------------------------
10 SHARED DISPOSITIVE
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,366,365 (6,075,891 have been acquired, and 290,474 are subject
to an option to acquire)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.58% (18.7% are currently owned, and exercise of an additional option
to acquire would increase the percentage owned by 0.89%)
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14 TYPE OF REPORTING PERSON
CO
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Item 1. Security and Issuer.
This statement relates to shares of Common Stock, par value $0.001 (the
"Common Stock"), of PICO Holdings, Inc., a California corporation (the
"Issuer"). The address of the Issuer's principal executive office is One Almaden
Boulevard, Suite 300, San Jose, California 95113.
Item 2. Identity and Background.
(a)-(c) This statement is filed by Guinness Peat Group plc, an English
public limited company ("GPG"). GPG is an investment holding company with a
diversified range of strategic interests in a number of businesses. A majority
of its funds are invested in the United Kingdom, Australia and New Zealand.
GPG's shares are publicly held and are traded on the London, Australian and New
Zealand Stock Exchanges. GPG's business and principal office address is Second
Floor, 21-26 Garlick Hill, London EC4V 2AU, England.
GPG has six Directors. The executive Chairman is Sir Ron Brierley. Sir
Ron owns approximately 3.7% of the outstanding shares of GPG. The second
GPG Director, Blake A. Nixon, is GPG's Executive Director in the United
Kingdom. The third GPG Director, Dr. Gary H. Weiss, is GPG's Executive
Director in Australia. Trevor J.N. Beyer, Maurice William Loomes and Anthony
Ian Gibbs are the other three Directors.
GPG Shareholder Merrill Lynch Asset Management owns approximately
9.1% of the outstanding shares of GPG. Permanent Trustee Company Limited
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and Permanent Trustee Australia Limited, on behalf of BT SMT-Equity Imputation
Fund and certain other clients, owns approximately 4.9% of the outstanding
shares of GPG.
Schedule 1, which is attached to this Schedule 13D, sets forth the
information required by Items 2(a)-(c) and 2(f) of Schedule 13D for each of the
executive officers and directors of GPG.
GPG disclaims the existence of control of GPG by Merrill Lynch Asset
Management, Permanent Trustee Company Limited, Permanent Trustee Australia
Limited, BT SMT-Equity Imputation Fund or any other person, and disclaim any
admission of such control.
(d) None of GPG nor, to the best knowledge of GPG, any of the executive
officers or directors of GPG has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors) during the last five
years.
(e) None of GPG nor, to the best knowledge of GPG, any of the executive
officers or directors of GPG has during the last five years been a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction,
and as a result of such proceeding, was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
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Item 3. Source and Amount of Funds or Other Consideration.
The Newly Acquired Shares were obtained in exchange for GPG's
previously held 1,212,777 Shares of Class A Common Stock (the "PICO Shares") of
Physicians Insurance Company of Ohio ("PICO") pursuant to the merger transaction
(the "Merger") described in the Agreement and Plan of Reorganization among
Citation Insurance Group ("Citation"), Citation Holdings, Inc. and PICO, dated
as of May 1, 1996 as amended, a copy of which has been previously filed with the
Securities and Exchange Commission (the "Commission") as noted at Exhibit A on
the Exhibit Index to this Schedule 13D (the "Exhibit Index"). Upon the Merger
becoming effective on November 20, 1996, each PICO share was converted into
5.0099 shares of PICO Holdings, Inc.
Item 4. Purpose of Transaction.
GPG has acquired the securities described in Item 5 as a result of the
Merger. It presently intends to hold such securities for investment purposes.
So long as GPG holds 11% or more of the outstanding shares of the
Issuer, GPG would have the right to nominate one director to the Issuer's Board
of Directors, and the Issuer shall be obligated, subject to any fiduciary duties
and responsibilities which the Issuer and its Board of Directors owe to the
Issuer's shareholders or others under applicable law, to use its best efforts to
cause the nomination and election of such person to serve on PICO's Board of
Directors. Such rights of GPG are set forth in Section 6.01 of the Agreement for
Purchase and Sale of Stock, dated November 23, 1993, among GPG, Quaker Holdings
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Limited and PICO (the "GPG Agreement"), which has previously been filed with
Commission as noted at Exhibit B on the Exhibit Index, as amended by the
Agreement for Purchase and Sale of Shares, dated May 9, 1996 among GPG, Global
Equity Corporation f/k/a The Ondaatje Corporation ("GEC") and PICO (the
"Subsequent Agreement"), which has previously been filed with the Commission as
noted at Exhibit C on the Exhibit Index, and as amended by the Assignment and
Assumption Agreement between Citation and PICO dated as of November 20, 1996
(the "Assumption Agreement"), which is attached hereto as Exhibit D. GPG's
current designee on the Issuer's Board of Directors is Dr. Gary H. Weiss, an
Executive Director of GPG.
GPG also has certain rights to increase its holdings of Common Stock. So
long as GPG owns at least 15% of the voting power of the Issuer, GPG has the
option to purchase at any time additional shares of Common Stock ("Additional
Shares") from the Issuer for purchase prices that do not exceed in the aggregate
$1,174,817.37. The purchase price for any such Additional Shares will be the
average of the closing bid prices for shares of Common Stock as reported by
NASDAQ for the 20 days preceding the date of GPG's written notification of its
exercise of such option to the Issuer. Such rights of GPG to purchase Additional
Shares are set forth in Sections 7.01, 7.02, 7.03 and 7.04 of the GPG Agreement,
Sections 3 and 4 of the Subsequent Agreement and Clauses 1 through 3, inclusive,
of the Assignment Agreement.
These provisions could have the effect of impeding an acquisition of
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control of the Issuer by another person.
Item 5. Interest in the Securities of the Issuer.
(a) GPG beneficially owns shares of Common Stock as follows:
(i) Upon the Merger becoming effective on November 20, 1996,
each of GPG's 1,212,777 PICO Shares were converted into
5.0099 shares of the Common Stock. Accordingly, GPG became
the holder of 6,075,891 shares of the Common Stock. Based
upon the number of shares of the Common Stock outstanding at
the time of the merger, such shares represent approximately
18.7% of the outstanding shares of the Common Stock.
(ii) Under the terms of the GPG Agreement, as amended, and as
described in Item 4 above, GPG also has the option to
purchase Additional Shares from the Issuer for purchase
prices that do not exceed in the aggregate $1,174,817.37.
The purchase price payable by GPG for any such Additional
Shares will be the average of the closing bid prices for
shares of the Common Stock as reported by NASDAQ for the 20
days preceding the date of GPG's written notification of its
exercise of such option to the Issuer. Based on the purchase
price that would have been applicable to such option on the
date of execution of the Merger, a full exercise by GPG of
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such option on such date would have entitled GPG to acquire
an additional 290,474 shares of the Common Stock. Such
additional shares would increase the number of shares of
Common Stock owned by GPG to 6,366,365 and would increase
the percentage of outstanding shares of Common Stock owned
by GPG to 19.58%.
(b) GPG has sole voting and dispositive power over the shares of Common
Stock described above.
(c) Except as set forth herein, no person identified in Item 2 above has
effected any transaction in shares of Common Stock during the past 60 days.
(d) No other person is known to have the right to receive or the power
to direct the receipt of dividends from, or the proceeds of the sale of, the
shares of Common Stock described above.
Item 6. Understandings or Relations with Respect to Securities of the
Issuer.
Each of Ronald Langley and John Hart signed a Call Option Agreement,
dated November 23, 1993, with GPG (the "Call Option Agreements"). The Call
Option Agreements give each of Langley and Hart an option to buy up to 10% of
any shares of Common Stock (including Additional Shares) acquired pursuant to
the GPG Agreement, as amended. As of the merger date, Langley and Hart
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would have each had the option to buy from GPG 715,699 shares of the Common
Stock at approximately $.70 per share, and 316,415 shares of the Common Stock at
approximately $.95 per share. The purchase price payable by Langley or Hart for
any Additional Shares that GPG may acquire as described in Item 4 above would be
the higher of approximately $.70 per share and the average price paid for such
Additional Shares by GPG. On the date of the Merger, each of Langley and Hart
would be entitled to purchase 1,032,114 shares of the Common Stock. Ownership of
such shares would give each of Langley and Hart 3.17% of the outstanding shares
of Common Stock in addition to any other shares they may own. If GPG were to
exercise fully its option to purchase Additional Shares at the purchase price
per share that would have applied on the date of the Merger, as described in
Item 5(a) above, each of Langley and Hart would be entitled to purchase an
additional 29,947 shares of Common Stock. Such additional purchase would give
each of Langley and Hart 1,062,061 shares of Common Stock, which would represent
for each of them 3.27% of the outstanding shares of Common Stock. To the best
knowledge of GPG, Ronald Langley and John Hart have no agreement or arrangement
with respect to the acquisition, holding, voting, or disposing of shares of
Common Stock except as set forth herein.
GPG must notify each of Langley and Hart before transferring any shares
of the Common Stock (including Additional Shares) that are subject to their
options so that Langley and Hart will have the opportunity to exercise their
options before such transfer.
9
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Such options to purchase held by Langley and Hart in Clauses 2.1 through
2.7 and 7.1 through 7.4 of the Call Option Agreement between GPG and Ron
Langley, which has previously been filed with the Commissions as noted at
Exhibit E on the Exhibit Index, and for the Call Option Agreement between GPG
and John Hart, which has previously been filed with the Commission as noted at
Exhibit F on the Exhibits Index.
The Issuer has been assigned a right of first refusal in respect of the
shares of Common Stock that GPG has acquired or may acquire. Such right of first
refusal is set forth in Sections 6.07, 6.08, 6.09 and 6.10 of the GPG Agreement,
which has previously been filed with the Commission as noted at Exhibit B on the
Exhibit Index.
The Issuer has been assigned rights of first refusal in respect any
shares of Common Stock acquired by Langley and Hart pursuant to their respective
Call Option Agreements. Such rights rights of first refusal are set forth in the
Agreement, dated as of November 23, 1993, between PICO and Langley, which has
previously been filed with the Commission as noted at Exhibit G, on the Exhibit
Index, and the Agreement, dated as of November 23, 1993, between PICO and Hart,
which has previously been filed with the Commission as noted at Exhibit H on the
Exhibit Index. Assignments referenced above are set forth in the Assumption
Agreement.
Except as set forth in Item 4 above and in this Item 6, none of GPG nor,
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to the best knowledge of GPG, any other person identified in Item 2 above has
any contract, arrangement, understanding or relationship (legal or otherwise)
with any person with respect to any securities of the Issuer, including but not
limited to the transfer or voting of any such securities, finders fees, joint
ventures, loan or option agreements, puts or calls, guarantees of profits,
division of profits or loss or the giving or the withholding of proxies.
[The balance of this page has been intentionally left blank.]
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Item 7. Materials to be Filed as Exhibits.
* Exhibit A - Agreement and Plan of Reorganization among Citation
Insurance Group ("Citation"), Citation Holdings, Inc.
and PICO, dated as of May 1, 1996, as amended by
amendment thereto dated August 14, 1996, and related
Merger Agreement
** Exhibit B - Agreement for Purchase and Sale of Stock,
dated November 23, 1993, among GPG, Quaker Holdings
Limited and PICO
*** Exhibit C - Agreement for Purchase and Sale of Shares, dated May 9,
1996 among GPG, GEC and PICO
Exhibit D - Assignment and Assumption Agreement between Citation
and PICO dated as of November 20, 1996
**** Exhibit E - Call Option Agreement, dated November 23, 1993, between
GPG and Ron Langley
***** Exhibit F - Call Option Agreement, dated November 23, 1993, between
GPG and John Hart
****** Exhibit G - Agreement, dated as of November 23, 1993,
between PICO and Ronald Langley.
******* Exhibit H - Agreement, dated as of November 23, 1993,
between PICO and John Hart.
* Incorporate by reference to Exhibit 2.2 of Registration Statement on
Form 5-H (File No. 333-06671) filed by the Issuer (the "Registration
Statement")
** Incorporated by reference to Exhibit 10.56 of Registration Statement
*** Incorporated by reference to Exhibit 10.59 of Registration Statement
**** Incorporated by reference to Exhibit C to Schedule 13D filed by GPG
and Quaker Holdings Limited regarding PICO, dated December 10, 1993
(the "PICO 13D")
***** Incorporated by reference to Exhibit D to PICO 13D
****** Incorporated by reference to Exhibit E to PICO 13D
******* Incorporated by reference to Exhibit F to PICO 13D
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: November 29, 1996
Guinness Peat Group plc
By: /s/ B.A. Nixon
------------------------------
Name: B.A. Nixon
Title: Executive Director
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SCHEDULE 1
<TABLE>
<CAPTION>
==============================================================================================
NAME AND BUSINESS POSITION WITH GPG AND CITIZENSHIP
ADDRESS PRINCIPAL OCCUPATION
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
Trevor J. N. Beyer Director of GPG, and Director of New Zealand
Guinness Peat Group plc Brierley Investments Ltd, Welgas
Second Floor Holdings Ltd, Alvis plc, Brown
21-26 Garlick Hill Shipley Holdings; Avimo Singapore
London EC4V 2AU England Ltd and Waterfall Holdings plc
Sir Ron Brierley Director and Chairman of the Board New Zealand
Guinness Peat Group plc of GPG, non-executive Director and
Second Floor Founder President of Brierley
21-26 Garlick Hill Investments Ltd, director of
London EC4V 2AU England Australian Gas Light Company,
Advanced Bank (Australia) Ltd,
Tyndall Australia Ltd, Mid-East
Minerals Ltd, Brown Shipley Holding
Ltd and Avimo Singapore
Blake A. Nixon Director and President of Quaker, New Zealand
Guinness Peat Group plc and Executive Director of GPG,
Second Floor Director of Brown Shipley Holdings
21-26 Garlick Hill Ltd, the Groucho Club London plc
London EC4V 2AU England and Hampshire Company plc, and an
Alternate Director of Tyndall
Australia Ltd.
Dr. Gary H. Weiss Executive Director of GPG, Deputy New Zealand
Guinness Peat Group plc Chairman of Tyndall Australia Ltd.
Second Floor and Mid-East Minerals Ltd, Director
21-26 Garlick Hill of Allgas Energy Ltd, ASC Ltd,
London EC4V 2AU England Australis Media Ltd, Brown Shipley
Holdings Ltd., PICO, the Issuer,
Premier Investments Ltd and Turners
& Growers Ltd.
Maurice William Loomes Executive Director of GPG Australia
Guinness Peat Group plc Director of ASC Ltd, Turners &
Second Floor Growers Ltd, Tyndall Australia Ltd,
21-26 Garlick Hill The Colonial Motor Company Ltd
London EC4V 2AU England and Jerrabomberra Estates Ltd.
Anthony Ian Gibbs Executive Director of GPG, New Zealand
Guinness Peat Group plc Chairman of Turners & Growers Ltd,
Second Floor Director of The New Zealand
21-26 Garlick Hill Guardian Trust Co. Ltd, Tyndall
London EC4V 2AU England Australia Ltd and The Colonial
Motor Company Ltd.
==============================================================================================
</TABLE>
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EXHIBIT D
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement, made this 20th day of
November 1996, by and between Physicians Insurance Company of Ohio ("PICO) and
Citation Insurance Group ("Citation").
WHEREAS, pursuant to an Agreement and Plan of Reorganization
dated May 1, 1996 (the "Merger Agreement") PICO will be merged with a wholly
owned subsidiary of Citation which will result in the issuance of shares of
Citation Common Stock to the holders of PICO Class A Common Stock in exchange
for their PICO shares (the "Merger").
WHEREAS, it is a condition to Guinness Peat Group's ("GPG's") and
Global Equity Corporation's ("GEC's") consent to the Merger that Citation assume
PICO's obligations under the Agreement (as defined below) upon consummation of
the Merger.
NOW, THEREFORE, the parties hereto agree as follows:
1. Effective as of the Effective Time of the Merger (as defined
in the Merger Agreement), PlCO assigns, transfers and conveys to Citation all of
its rights and obligations under the Agreement for Purchase and Sale of Stock
dated November 23, 1993 as such rights have been assigned and modified pursuant
to the Assignment and Assumption Agreement dated December 30, 1993 and the
Agreement for Purchase and Sale of Shares dated May 9, 1996 (collectively the
"Agreement").
2. Effective as of the Effective Time of the Merger, Citation
expressly assumes all of PICO's rights and obligations under the Agreement. As a
matter of clarification, the obligations so assumed which by the terms of the
Agreement relate to shares of common stock of PICO shall, as of the Effective
Time, be deemed to relate to shares of Citation common stock.
3. Citation has reviewed the Agreement for the Purchase and Sale
of Shares dated May 9, 1996 among GPG, GEC and PICO and related documents (the
"GPG Agreement") and hereby approves the form of the transaction and confirms
pursuant to Section 5.2(k) of the Merger Agreement that it is satisfied as to
the completion of the transactions contemplated by the GPG Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this
Assignment and Assumption Agreement as of the day and year first written above.
CITATION INSURANCE GROUP
By: /s/ Robert M. Erickson
------------------------------
Title: Acting President, CFO
PHYSICIANS INSURANCE COMPANY OF OHIO
By: /s/ John R. Hart
-------------------------------
Title: President
16
