Proxy Statement Pursuant to Section 114(a) of the Securities
Exchange Act of 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
YORK FINANCIAL CORP.
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(Name of Registrant as Specified in Its Charter)
YORK FINANCIAL CORP.
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(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] 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:
N/A
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(2) Aggregate number of securities to which transactions applies:
N/A
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
N/A
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(4) Proposed maximum aggregate value of transaction:
N/A
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[ ] 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:
N/A
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(2) Form, schedule or registration statement no.:
N/A
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(3) Filing party:
N/A
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(4) Date filed:
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N/A
[Letterhead of York Financial Corp.]
September 28, 1998
Dear Stockholders:
We invite you to attend the Annual Meeting of the Stockholders of York
Financial Corp. to be held at the Lafayette Room, Yorktowne Hotel, 48 East
Market Street, York, Pennsylvania on Wednesday, October 28, 1998 at 3:00 p.m.
The attached Notice of Stockholder's Annual Meeting and Proxy Statement
describe the formal business to be transacted at the meeting. During the
meeting, we will also report on the operations of the Company including its
principal subsidiary, York Federal Savings and Loan Association. Directors
and Officers of the Company as well as a representative of the independent
auditors of the Company, Ernst & Young LLP, will be present to respond to any
questions the stockholders may have.
Your vote is important, regardless of the number of shares you own. On
behalf of the Board of Directors, we urge you to sign, date and return the
enclosed proxy card as soon as possible, even if you currently plan to attend
the annual meeting. This will not prevent you from voting in person, but will
assure that your vote is counted if you are unable to attend the meeting.
Sincerely,
/s/Robert W. Pullo
Robert W. Pullo
President and Chief
Executive Officer
YORK FINANCIAL CORP.
101 S. George Street
P.O. Box 15068
York, Pennsylvania 17405
(717) 846-8777
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 28, 1998
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NOTICE IS HEREBY GIVEN THAT the Annual Meeting of Stockholders (the "Meeting")
of York Financial Corp. (the "Company") will be conducted at the Lafayette
Room, Yorktowne Hotel, 48 East Market Street, York, Pennsylvania on Wednesday,
October 28, 1998 at 3:00 p.m.
A proxy card and a proxy statement for the Meeting are enclosed herewith.
The Meeting is for the purpose of considering and acting upon:
1. The election of three directors of the Company; and
2. Such other matters as may properly come before the Meeting or
any adjournments thereof.
NOTE: The Board of Directors is not aware of any other business to
come before the Meeting.
Any action may be taken on any one of the foregoing proposals at the Meeting
on the date specified above or on any date or dates to which, by original or
later adjournment, the Meeting may be adjourned. Stockholders of record at
the close of business on September 8, 1998 are the stockholders entitled to
vote at the Meeting and any adjournment thereof.
You are requested to fill in and sign the enclosed form of proxy which is
solicited by the Board of Directors and to mail it promptly in the enclosed
envelope. The proxy will not be used if you attend and vote at the Meeting in
person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ROBERT A. ANGELO
ROBERT A. ANGELO
SECRETARY
York, Pennsylvania
September 28, 1998
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE YOUR COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES IN ORDER TO INSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES.
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PROXY STATEMENT
OF
YORK FINANCIAL CORP.
101 S. GEORGE STREET
P.O. BOX 15068
YORK, PENNSYLVANIA 17405
(717) 846-8777
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ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 28, 1998
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This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of York Financial Corp. ("Company") to be
used at the Annual Meeting of Stockholders of the Company ("Meeting"), which
will be held at the Lafayette Room, Yorktowne Hotel, 48 East Market Street,
York, Pennsylvania, on Wednesday, October 28, 1998, at 3:00 p.m. The
accompanying notice of meeting and this Proxy Statement are being first mailed
to stockholders on or about September 28, 1998. York Federal Savings and Loan
Association, a wholly-owned subsidiary of the Company, is referred to herein
as "York Federal" or the "Association."
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VOTING AND PROXY INFORMATION
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Shareholders Entitled to Vote. Stockholders of record as of the close of
business on September 8, 1998 ("Voting Record Date") are entitled to one vote
for each share of common stock ("Common Stock") of the Company then held. At
the close of business on the Voting Record Date, the Company had 9,104,694
shares of Common Stock issued and outstanding.
Quorum. The presence, in person or by proxy, of at least a majority of
the total number of outstanding shares of Common Stock entitled to vote is
necessary to constitute a quorum at the Annual Meeting. Abstentions will be
counted as shares present and entitled to vote at the Annual Meeting for
purposes of determining the existence of a quorum. Broker non-votes will not
be considered shares present for purposes of determining a quorum.
Voting. The Board of Directors solicits proxies so that each stockholder
has the opportunity to vote on the proposals to be considered at the Annual
Meeting. When a proxy card is returned properly signed and dated, the shares
represented thereby will be voted in accordance with the instructions on the
proxy card. Where no instructions are indicated, proxies will be voted FOR
the nominees for directors set forth below. If a stockholder attends the
Annual Meeting, he or she may vote by ballot.
If a stockholder does not return a signed proxy card or does not attend
the Annual Meeting and vote in person, his or her shares will not be voted.
If a stockholder is a participant in the York Federal Savings and Loan
Association Employee Stock Ownership Plan ("ESOP"), the proxy card represents
a voting instruction to the trustees of the ESOP as to the number of shares in
the participant's plan account. Each participant in the ESOP may direct the
trustees as to the manner in which shares of Common Stock allocated to the
participant's plan account are to be voted. Unallocated shares of Common
Stock held by the ESOP and allocated shares for which no voting instructions
are received will be voted by the trustees in the same proportion as shares
for which the trustees have received voting instructions.
The three directors to be elected at the Annual Meeting will be elected
by a plurality of the votes cast by stockholders present in person or by proxy
and entitled to vote. Stockholders are not permitted to cumulate their votes
for the election of directors. With respect to the election of directors,
votes may be cast for or withheld from each nominee. Votes that are withheld
and broker non-votes will have no effect on the outcome of the election
because directors will be elected by a plurality of votes cast.
Revocation of a Proxy. Stockholders who execute proxies retain the right
to revoke them at any time. Proxies may be revoked by written notice
delivered in person or mailed to the Secretary of the Company or by filing a
later proxy prior to a vote being taken on a particular proposal at the Annual
Meeting. Attendance at the Annual Meeting will not automatically revoke a
proxy, but a stockholder in attendance may request a ballot and vote in
person, thereby revoking a prior granted proxy.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
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Persons and groups owning in excess of 5% of the Company's Common Stock
are required to file certain reports disclosing such ownership pursuant to the
Securities Exchange Act of 1934, as amended ("1934 Act"). Based upon such
reports and information, the following table sets forth, at the close of
business on the Voting Record Date, certain information as to those persons
who were beneficial owners of more than 5% of the outstanding shares of Common
Stock. Management knows of no persons other than the person set forth below
who owned more than 5% of the outstanding shares of Common Stock at the close
of business on the Voting Record Date. The table also sets forth information
as to the shares of Common Stock beneficially owned by the Chief Executive
Officer of the Company, by the Company's or the Association's four other most
highly compensated individuals ("named executive officers") and by all
executive officers and directors of the Company as a group.
Amount and Nature Percent of Shares
Name and Address of Beneficial of Common Stock
of Beneficial Owner Ownership (1) Outstanding (1)
- ------------------- ------------- ---------------
Beneficial Owners of More than 5%
Robert W. Pullo 505,348(2) 5.07%
101 South George Street
York, Pennsylvania 17405
Directors
Cynthia A. Dotzel 94,477(3) 0.94
Paul D. Mills 136,203(4) 1.36
Byron M. Ream 86,927 0.87
Robert W. Erdos 159,795(5) 1.60
Randall A. Gross 103,373 1.03
Carolyn E. Steinhauser 92,761(6) 0.93
Thomas W. Wolf 420,078(7) 4.22
Robert L. Simpson 42,527(8) 0.42
Named Executive Officers (9)
Robert W. Pullo (10) 505,348(2) 5.07
Robert A. Angelo, Esq. 261,553(11) 2.62
James H. Moss, CPA 137,353 1.38
Robert C. Herzberger 62,396 0.62
Harry M. Zimmerman 6,100 0.06
All Executive Officers and Directors
as a Group (18 Persons) 2,170,711(12) 21.81%
(footnotes on following page)
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(1) In accordance with Rule 13d-3 under the 1934 Act, a person is deemed to
be the beneficial owner, for purposes of this table, of any shares of
the Company's Common Stock if he or she has shared voting or investment
power with respect to such security, or has a right to acquire
beneficial ownership at any time within 60 days from the close of
business on the Voting Record Date. Except as otherwise noted below,
the table includes shares owned by spouses, other immediate family
members in trust and other forms of ownership, over which the persons
named in the table possess shared voting and investment power. This
table also includes shares of Common Stock subject to outstanding
options which will be exercisable within 60 days from the close of
business on the Voting Record Date.
(2) Excludes 249,555 shares owned by the York Federal Savings and Loan
Association Employee Stock Ownership Plan of which Mr. Pullo is the
trustee. Also excludes 4,811 shares owned by the spouse of Mr. Pullo
for which he disclaims any voting or investment power.
(3) Excludes 8,655 shares owned by the spouse of Ms. Dotzel, for which she
disclaims any voting or investment power. Excludes 15,697 shares Ms.
Dotzel holds as custodian for minor children under the Uniform Gifts to
Minors Act.
(4) Excludes 16,245 shares owned by the spouse of Mr. Mills, for which he
disclaims any voting or investment power.
(5) Excludes 11,730 shares owned by the spouse of Mr. Erdos, for which he
disclaims any voting or investment power.
(6) Excludes 8,560 shares held by trusts for Ms. Steinhauser's children, of
which Ms. Steinhauser is a trustee.
(7) Includes 159,705 shares owned by affiliated companies of Mr. Wolf of
which he is an officer, director and principal stockholder. Excludes
4,947 shares owned by the spouse of Mr. Wolf, for which he disclaims
any voting or investment power. Excludes 3,152 shares Mr. Wolf holds
as custodian for minor children under the Uniform Gifts to Minors Act.
(8) Includes 4,022 shares held in trust in a Deferred Compensation Plan
sponsored by Mr. Simpson's employer.
(9) SEC regulations define the term "named executive officers" to include
all individuals serving as chief executive officer during the next
recently completed year, regardless of compensation level, and the four
most highly compensated executive officers, other than the chief
executive officer, whose total annual salary and bonus for the last
completed fiscal year exceeded $100,000. Messrs. Pullo, Angelo,
Herzberger, Moss and Zimmerman were the Company's "named executive
officers" for the fiscal year ended June 30, 1998.
(10) Mr. Pullo is also a director of the Company.
(11) Excludes 7,007 shares owned by the spouse of Mr. Angelo for which he
disclaims any voting or investment power.
(12) Includes 843,151 shares of Common Stock which may be received upon the
exercise of stock options which are exercisable within 60 days of the
Voting Record Date.
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Proposal I -- Election of Directors
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The Company's Articles of Incorporation provide that directors are to be
elected for terms of three years, approximately one-third of whom are elected
annually. Three directors will be elected at the Meeting to serve for a
three-year period or until their respective successors have been elected and
qualified. The Nominating Committee of the Board of Directors has nominated
for election as directors Cynthia A. Dotzel, Paul D. Mills and Byron M. Ream,
each of whom are currently members of the Board.
If any nominee is unable to serve, the shares represented by all valid
proxies will be voted for the election of such substitute as the Board of
Directors may recommend. At this time, the Board knows of no reason why any
nominee might be unable to serve.
The following table sets forth each nominee and director's name, age, the
year he or she first became a director, and the year in which his or her
current term will expire. Each director is also a member of the Board of
Directors of York Federal.
Year
First Term
Elected to
Name Age(1) Director(2) Expire
- ---- ------ ----------- ------
BOARD NOMINEES
Cynthia A. Dotzel 44 1984 2001*
Paul D. Mills 68 1970 2001*
Byron M. Ream 54 1984 2001*
DIRECTORS CONTINUING IN OFFICE
Robert W. Erdos 67 1971 1999
Randall A. Gross 54 1984 1999
Robert W. Pullo 58 1981 1999
Carolyn E. Steinhauser 59 1984 2000
Thomas W. Wolf 49 1984 2000
Robert L. Simpson 51 1994 2000
- ------------
(*) Assuming they are re-elected at the Meeting.
(1) As of September 8, 1998.
(2) Includes prior service on the Board of Directors of York Federal.
The principal occupation of each director of the Company for the last
five years is set forth below.
BOARD NOMINEES
Cynthia A. Dotzel of York, Pennsylvania, is a Certified Public
Accountant, practicing with Dotzel & Company, Inc., Certified Public
Accountants. She earned a Bachelor of Science degree in Accounting from York
College after completing undergraduate work at York College and Bloomsburg
University. Ms. Dotzel is a member of the Cyber Center Management Group. She
is a member of the Finance Committees of St. Patricks Church in York and the
York Foundation.
-4-
Paul D. Mills of Hellam, Pennsylvania, is the owner of Willow Tree
Farms, a thoroughbred horse breeding farm and training center. He is a member
of the North York Lions Club and the State Horse Racing Commission. Mr. Mills
is a past President of the Pennsylvania Horse Breeders Association. He is a
member of the White Rose Lodge 706, York County Shrine Club, and V.F.W. Post
6241.
Byron M. Ream of York, Pennsylvania, is Executive Vice President of R&R
Components, Inc. He formerly served as the Director of Property Management
and as a realtor for Bennett Williams, Inc., York. Mr. Ream attended Wesleyan
University and Pennsylvania State University, York Campus. He is a member of
the Building Committee of the United Way of York County, a past President of
the Board of Trustees of Asbury United Methodist Church, and a member of the
Board of Directors of Bell Socialization Services and B.U.I.L.D., Inc.
DIRECTORS CONTINUING IN OFFICE
Robert W. Erdos of York, Pennsylvania, is the owner of Stomp Off
Records, a company which produces recordings of jazz and ragtime. He earned a
Bachelor of Arts degree from the University of Pennsylvania and an LLB from
Yale Law School. From 1957 to 1981 he was Executive Vice President of Danskin
Inc., which is a manufacturer of dancewear and sportswear. He is a Past
President of the United Way and a Past President of the Manufacturers
Association of York County. Mr. Erdos served as a member of the Board of
Directors of the York Hospital from 1977 to 1989.
Randall A. Gross of York, Pennsylvania, is President of RG Industries.
He earned his BBA and MBA from the University of Cincinnati. Mr. Gross was
formerly Chairman of the York Area Chamber of Commerce and also Chairman of
its Reaccreditation Committee. He also served with the Chamber of Commerce as
Chairman of the Local Government Committee, Vice President of Community
Affairs, member of the Executive Committee, Budget and Finance Committee, and
Board of Directors. Mr. Gross is a member of the Board of Trustees of York
College, and Board of Directors of Tighe Industries, York Graphic Services and
Valin Corporation. He is also a member of the Chief Executive Officers (CEO)
Organization. He is Past Chairman of the Keystone Chapter of the Young
Presidents' Organization where he had previously served as Education Chairman.
Mr. Gross is licensed by the State of Georgia as a Certified Public
Accountant.
Robert W. Pullo of York, Pennsylvania, is President and Chief Executive
Officer of York Financial Corp. and a member of the Board of Directors. He is
also Chairman of the Board of Directors and Chief Executive Officer of York
Federal Savings and Loan Association, as well as Chairman of the Board of
Directors of subsidiary companies - First Capital Brokerage Services, Inc.,
Lenders Support Group, Inc., New Service Corp., First Capital Insurance
Services, Inc. and Y-F Service Corp., Inc. He also serves on the Advisory
Board of Meridian Venture Partnership. He is a member of the American
Community Bankers' national task force for electronic banking. He is the
founding and current Chairman of the Board of the White Rose Foundation and is
President of the Advisory Board for Penn State York. Mr. Pullo serves on the
Board of Directors and Executive Committees of Memorial Hospital of York and
the parent company Memorial Health Systems Corporation. He also serves on the
Board of Trustees of the York YMCA and the York YWCA. He is a member of the
Advisory Board of Junior Achievement, Youth Build, and the Junior League of
York. He is also a member of the Board of Directors of the Jewish Community
Center of York, Better York, the Strand Capitol Performing Arts Center, and
the founding Board of the Susan P. Byrnes Health Education Center of Central
Pennsylvania. He was the charter Chairman of the United Way Housing
Initiatives and is past Chairman of the United Way Annual Fund Raising
Campaign. He is also a past Chairman of the York Area Chamber of Commerce.
Mr. Pullo is the recipient of the Minority Business Association's Volunteer of
the Year award and the Excellence award from the Human Relations Commission
for his work with minorities.
Carolyn E. Steinhauser of York, Pennsylvania, is Executive
Director/Administration of York Foundation. A graduate of Middlebury
College, Ms. Steinhauser is a member of the board of Commonwealth Community
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Foundations (PA) and a Trustee of York College of Pennsylvania. She was
formerly Vice President/Campaign of the United Way of York County and
Executive Director of the York YWCA.
Thomas W. Wolf of Mount Wolf, Pennsylvania, is President of The Wolf
Organization, Inc. where he has been affiliated since 1979. Mr. Wolf earned a
Bachelor of Arts degree from Dartmouth College, a Master of Philosophy from
the University of London, and a Ph.D. from the Massachusetts Institute of
Technology. Mr. Wolf is past Chairman of the Board of the York Area Chamber
of Commerce, Past Chairman of the Board of the United Way of York County, past
Chairman of the Board of WITF Public Broadcasting Station, Vice Chairman of
the Board of York College of Pennsylvania, and President of Better York, Inc.
Mr. Wolf served in the U.S. Peace Corps in India.
Robert L. Simpson of York, Pennsylvania, is Executive Director of the
Crispus Attucks Association, a multi-purpose community center, a position he
has held since 1979. Mr. Simpson serves on the Board of Directors and the
Medical Affairs and Community Health Care Committees of the York Hospital, is
a Trustee of York College of Pennsylvania and is a member of the Board of
Directors of WITF Public Broadcasting Station. Mr. Simpson also serves on the
Board of Directors of the York Health Bureau, the White Rose Foundation, and
the Martin Memorial Library. A member of the Rotary Club of York, he serves
on the Rotary and York City School District Drop-Out Prevention Program
Committee, and serves on the Atkins House Advisory Committee. He has also
served on the boards of the County Drug Task Force, York 2000 Committee, the
YMCA, York Area Chamber of Commerce, and the Junior League.
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Meetings and Committees of the Board of Directors
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The Board of Directors of the Company conducts monthly meetings to
review the progress of the Company and establish its strategic goals and
policies. Additional meetings are held as dictated by the current operations
of the Company. The Board of Directors of the Company met 13 times during the
fiscal year. All directors attended at least 75% of the Board meetings.
The Board of Directors of the Company has various standing committees
including an Audit Committee, Compensation Committee, Nominating Committee and
Executive Committee. All committee members attended at least 75% of the
respective committee meetings.
The Audit Committee establishes the scope of internal and external
audits, reviews and evaluates the results of such audits and directs the
implementation of internal controls where necessary. The Audit Committee is
comprised of Directors Dotzel (Chair), Erdos, Ream, Gross and Wolf. The Audit
Committee met five times during the fiscal year.
The Compensation Committee administers the remuneration and incentive
programs for executives and senior management and makes recommendations to the
Board of Directors regarding salaries, bonuses, stock options, and other
incentive plans. The Committee also reviews the schedule of compensation,
stock options, and other incentive plans for members of the Board and its
committees. The Compensation Committee is composed of Directors Wolf (Chair),
Erdos, Mills, Gross and Steinhauser. The Compensation Committee met four
times during the fiscal year.
The Nominating Committee meets to recommend to the Board of Directors of
the Company nominees for election as directors and committee members. The
Nominating Committee will consider nominees recommended by stockholders.
Article XI of the Company's Articles of Incorporation sets forth procedures
for stockholders to make nominations and proposals. Article XI provides that:
"Nominations for the election of directors and proposals for any new business
to be taken up at any annual or special meeting of stockholders may be made by
the board of directors of the Corporation or by any stockholder of the
Corporation entitled to vote generally in the election of directors. In order
for a stockholder of the Corporation to make any such nominations and/or
proposals, he or she shall give notice thereof in writing,
delivered or mailed by first class United States mail, postage paid, to the
Secretary of the Corporation not less than 30 days nor more than 60 days prior
to any such meeting. Each such notice given by a stockholder with respect to
nominations for the election of directors shall set forth (i) the name, age,
business address and, if known,
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residence address of each nominee proposed in such notice, (ii) the principal
occupation or employment of each such nominee, and (iii) the number of shares
of stock of the Corporation which are beneficially owned by each such
nominee." The Nominating Committee is comprised of Directors Mills (Chair),
Erdos, Gross, Wolf, Ream, Steinhauser and Simpson. The Nominating Committee
met one time during the fiscal year.
York Federal Savings and Loan Association, Y-F Service Corp., New
Service Corp., First Capital Brokerage Services, Inc., Lenders Support Group,
Inc., and First Capital Insurance Services, Inc., subsidiaries of the Company,
are governed by their own board of directors, the members of which are
selected from the Board of Directors of the Company, or, in the case of First
Capital Brokerage Services, Inc., Lenders Support Group and First Capital
Insurance Services, Inc., are senior officers of the Company or York Federal
and are appointed by the Board of Directors. The Board of Directors of York
Federal also maintains an Executive Committee, Pension Committee and Building
Committee.
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Directors' Compensation
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For service in 1998 as a member of the Board of Directors of the
Company, each Director received a fee of $500 for each meeting attended. For
services as a member of the Audit Committee, the chair received a retainer of
$4,000 and each committee member received a retainer of $1,000. For services
as a member of the Compensation Committee and Nominating Committee, the
respective committee chair received a retainer of $2,000 and each committee
member received a retainer of $1,000. A fee of $400 was received by Audit
Committee members for each meeting attended. A fee of $200 was received by
Compensation Committee members and Nominating Committee members for each
meeting attended.
For service in 1998 as a member of the Board of Directors of the
Association, each director received a retainer of $10,000 and a fee of $500
for each meeting attended. For service as a member of the Executive Committee
of the Association, each member received a retainer of $4,500 and a fee of
$400 for each meeting attended. For services as a member of the Pension
Committee and Building Committee of the Association, the respective committee
chair received a retainer of $2,000 and each committee member received a
retainer of $1,000. A fee of $200 was received by Pension Committee members
and Building Committee members for each meeting attended.
For service in 1998, directors of the Company who also served as members
of the Board of Directors of subsidiaries of the Company, Y-F Service Corp.
and New Service Corp., received a fee of $200 for each meeting attended and a
retainer fee of $2,000.
Directors of the Company are participants in the 1984 Non-Incentive
Stock Option Plan, the 1992 Non-Incentive Stock Option Plan for Directors and
the 1995 Non-Qualified Stock Option Plan for Directors. The Plans were
designed to attract and retain the best available personnel as directors of
the Company and to provide additional incentive for directors to promote the
success of the business. All options under the 1984 and 1992 Plans have been
granted, and there are unexercised options that remain outstanding. The 1995
Plan is a formula plan providing for an annual grant of options on October 1
of each year (to the extent options are available) at the closing price of the
Company's stock on the last business day prior to October 1 of each year.
In 1979, York Federal established a directors' deferred compensation
plan whereby the Association agreed to pay retired or disabled directors with
10 or more years of service a joint and several annuity based on compensation
received by a participating director during the last 60 months of service to
the Association. Benefits under the Plan normally begin at age 70 and are
paid monthly for a period of 10 years or until death of the director and
spouse, whichever first occurs. The Plan is unfunded.
-7-
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Executive Compensation
- ------------------------------------------------------------------------------
Summary Compensation Table. The following information is furnished for
the Company's chief executive officer and named executive officers for the
year ended June 30, 1998.
Summary Compensation Table*
Long-
Term
Compen-
sation
Annual Compensation Awards
---------------------------- ------
Other All
Annual Other
Compen- Compen-
Name and Salary Bonus sation Options sation
Principal Position Year ($) ($) ($)(1) (#)(2) ($)(3)
------------------ ---- ------ ----- ------ ------- -------
Robert W. Pullo, President 1998 $360,490 $167,197(4) -- 23,781 $55,906
and Chief Executive Officer 1997 330,502 105,884 -- 3,781 56,296
1996 330,502 119,956 -- 29,219 55,896
Robert A. Angelo, Executive 1998 $185,000 $87,530(4) -- 15,000 $ 9,030
Vice President, Secretary 1997 170,000 60,255 -- -- 10,120
and General Counsel;
President of York Federal 1996 170,000 63,580 -- 2,750 10,120
James H. Moss, Senior Vice 1998 $135,000 $64,428(4) -- 10,000 $ 7,369
President, Chief Financial 1997 126,445 43,811 -- -- 8,023
Officer/Treasurer;
Executive Vice President of 1996 123,000 46,288 -- 2,750 8,023
York Federal
Robert C. Herzberger, Senior 1998 $119,231 $60,551(4) -- -- $ 6,395
Vice President; Senior Vice 1997 136,953 47,550 -- -- 7,794
President of York Federal 1996 134,000 49,771 -- 2,750 7,794
Harry M. Zimmerman, 1998 $125,000 $41,669 -- 10,000 $ 3,025
Executive Vice President of 1997 19,231 829 -- 12,500 --
York Federal
__________
* All compensation is paid by the Association but allocated between the
Company and the Association based on approximate time spent by the named
executive officer on Company business.
(1) Amounts not reportable as they do not exceed the lesser of $50,000 or
10% of salary and bonus.
(2) The number of stock options indicated for 1997 and 1996 have been
adjusted for stock dividends issued.
(3) Includes contributions of $3,846, $3,846, $3,846, $3,537 and $3,025,
respectively, for Messrs. Pullo, Angelo, Moss, Herzberger and Zimmerman
to the Company's ESOP. Includes contributions of $18,260, $3,684,
$2,023 and $1,358, respectively, for Messrs. Pullo, Angelo, Moss and
Herzberger for life insurance premiums. Includes $32,300 in directors'
fees paid to Mr. Pullo. Includes directors' fees of $1,500 ($300 per
meeting) for each of Messrs. Pullo, Angelo, Moss and Herzberger for
board meetings of York Financial Investment Corp., a subsidiary of York
Federal.
(4) Includes bonuses received in November 1997 under the Company's Bonus
Plan for performance standards achieved in the 1996/1997 fiscal year.
-8-
Option Grants Table. The following table sets forth all grants of
options to the Company's Chief Executive Officer and named executive officers
for the fiscal year ended June 30, 1998.
Individual Grants(1)
------------------------------------------------------------
% of Total Potential Realizable
Options Value at Assumed
Granted to Annual Rates of
Employees Stock Price Appre-
Options in Exercise Expir- ciation for Option
Granted Fiscal Price ation Term(2)
Name (#) Year ($/Sh) Date 0%($) 5%($) 10%($)
---- -------- ------- --------- ------ ------ ------ -------
Robert W. Pullo 3,781 4.35% $20.6000 10/1/07 -- $ 48,984 $124,134
10,000 11.52 20.4375 6/17/08 -- 128,530 325,721
10,000 11.52 20.4375 6/17/08 -- 128,530 325,721
Robert A. Angelo 7,500 8.64 20.4375 6/17/08 -- 96,398 244,291
7,500 8.64 20.4375 6/17/08 -- 96,398 244,291
James H. Moss 5,000 5.76 20.4375 6/17/08 -- 64,265 162,861
5,000 5.76 20.4375 6/17/08 -- 64,265 162,861
Harry M. Zimmerman 5,000 5.76 20.4375 6/17/08 -- 64,265 162,861
5,000 5.76 20.4375 6/17/08 -- 64,265 162,861
- ------------
(1) Only named executive officers receiving grants are listed.
(2) The amounts under the columns labeled "5%" and "10%" are included by
the Company pursuant to certain rules promulgated by the Securities
and Exchange Commission and are not intended to forecast future
appreciation, if any, in the price of the Company's stock. Such
amounts are based on the assumption that the named persons hold the
options granted for their full 10 year term. The actual value of the
options will vary in accordance with the market price of the
Company's Common Stock. The column headed "0%" is included to
demonstrate that the options were granted at fair market value and
optionees will not recognize any gain without an increase in the
stock price, which increase benefits all stockholders commensurately.
The Company did not use an alternative formula to attempt to value
options at the date of grant, as management is not aware of any
formula which determines with reasonable accuracy a present value of
options of the type granted to the optionees.
Option Exercise Table. The following table sets forth all exercises of
options under the Stock Option and Incentive Plans to the Company's Chief
Executive Officer and named executive officers for the fiscal year ended June
30, 1998.
Number of
Securities
Underlying
Unexercised Value of Unexercised
Options In-the-Money Options
Shares at Fiscal at Fiscal
Acquired Year End ($) Year End ($)
on Value ---------------- ------------------
Exer- Real- Exer- Unexer- Exer- Unexer-
Name cise (#) ized($) cisable cisable cisable cisable
---- -------- -------- ------- ------- ------- -------
Robert W. Pullo -- $ -- 189,849 23,638 $2,461,213 $65,963
Robert A. Angelo 7,095 163,533 118,641 19,138 1,545,749 63,994
James H. Moss 22,202 430,617 50,402 13,125 657,746 45,947
Robert C. Herzberger 27,472 525,569 24,143 4,125 257,240 42,009
Harry M. Zimmerman -- -- 6,000 16,500 29,813 48,000
-9-
Pension Plan Table. The following table indicates the annual retirement
benefit that would be payable under the Retirement Plan (as discussed herein)
upon retirement at age 65 to a participant electing to receive his or her
retirement benefit in the standard form of benefit, assuming various specified
levels of Retirement Plan compensation and various specified years of credited
service.
Estimated Annual Pension for
Representative Years of Service
----------------------------------------------
Average Earnings 10 15 20 25 30
---------------- ------- -------- -------- -------- -------
$ 25,000 $ 3,500 $ 5,250 $ 7,000 $ 8,750 $10,500
50,000 8,035 12,052 16,070 20,087 24,104
100,000 17,535 26,302 35,070 43,837 52,604
150,000 27,035 40,552 54,070 67,587 81,104
200,000 28,935 43,402 57,870 72,337 86,804
The York Federal Pension Plan is a noncontributory defined benefit
pension plan. An employee becomes a participant in the Plan after completing
one year of service and attaining age 21. Plan participants with five or more
years of service are entitled to monthly retirement benefits beginning at the
retirement age of 65. The retirement pension is payable monthly as long as
the participant lives.
A participant's accumulated pension credits are equal to 1/12th of the
sum of the benefits earned through June 30, 1996 plus the benefits earned
after July 1, 1996. Benefits earned through June 30, 1996 are equal to the
sum of (i) 1.1% of five year average compensation at June 30, 1996 for years
of benefit service before July 1, 1991; plus (ii) 1.4% of five year average
compensation at June 30, 1996 for years of benefit service from July 1, 1991
to June 30, 1996; plus (iii) 0.5% of average compensation over $25,920,
multiplied by the number of years of service from July 1, 1991 to June 30,
1996, up to 35 years. Benefits earned after July 1, 1996 are equal to 1.4% of
annual compensation for each year of service after July 1, 1996, plus 0.5% of
pay over the Social Security Integration Level for each year of service after
July 1, 1996, provided, however, that no pension benefit on compensation over
the Social Security Integration Level accrues for any year of service over 35
years. The amount of pension earned during a fiscal year is based upon
compensation during that year subject to limits imposed by the Internal
Revenue Code of 1986, as amended ("Code"). During the last fiscal year,
compensation for the purposes of calculating benefits for a Plan participant
was limited by the Code to $160,000. The Social Security Integration Level
for each plan year is equal to 100% of the Maximum Social Security Covered
Compensation as of the first day of the year.
The Plan provides for normal retirement at age 65 and permits early
retirement at ages between 55 and 64. Upon retirement, married participants
automatically receive an actuarially equivalent joint and 50% survivor pension
unless otherwise elected. The Plan also provides for other options for
pension benefits which can be elected by a participant. If the present value
of the monthly pension does not exceed $3,500, a lump sum payment is
automatically paid. Employees terminating after completion of at least five
years of service are entitled to a vested deferred pension equal to the
benefit accrued to the date of termination.
At June 30, 1998, the credited years of service for Messrs. Pullo,
Angelo, Moss, Herzberger and Zimmerman were 23, 25, 14, 12 and 1,
respectively.
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or
the Exchange Act that might incorporate future filings, including this Proxy
Statement, in whole or in part, the following report and Performance Graph
shall not be incorporated by reference into any such filings.
Report of the Compensation Committee. The Compensation Committee of the
Board of Directors of the Company is responsible for establishing,
implementing and monitoring all compensation policies of the Company and its
primary operating subsidiary, York Federal Savings and Loan Association. The
Committee is also responsible for
-10-
evaluating the performance of the Chief Executive Officer of the Company and
recommending appropriate compensation levels. The Chief Executive Officer
evaluates the performance of subordinate officers of the Company and its
subsidiaries and recommends individual compensation levels to the Compensation
Committee. None of the Committee's members is a current or former officer or
employee of the Company or any subsidiary of the Company.
The Compensation Committee believes that a compensation plan for
executive officers should take into account management skills, long term
performance results and stockholder returns. Compensation policies must be
maintained to promote:
1. the attraction and retention of highly-qualified executives;
2. motivation of executives that is related to the performance of
the individual and the Company;
3. current and long-term performance; and
4. a financial interest in the success of the Company similar to
the interests of its stockholders.
The Company's current compensation plan involves a combination of salary,
profit sharing and bonus to reward short-term performance and grants of stock
options to encourage long-term performance. The salary levels of executive
officers are designed to be competitive within the financial services
industry. Annual compensation surveys are utilized to determine competitive
salary levels and individual annual performance is reviewed to determine
appropriate salary adjustments. A profit sharing plan in which all executive
officers and employees of York Federal participate has been designed to align
their interests with that of the stockholders of the Company. Lenders Support
Group, Inc. and First Capital Brokerage Services, Inc. also have profit
sharing plans in which their executive officers and employees participate.
Profits distributable pursuant to the Plans may not exceed total dividends
paid to the stockholders during the year. Certain executive officers of York
Federal are eligible to participate in the York Financial Corp. Bonus Plan
which became effective July 1, 1995. This Plan provides for a bonus of up to
40% of the Executive Officer's base compensation if certain performance
standards are achieved for the fiscal year. The four performance standards,
or ratios, on which the Plan Participants are measured are Return on Assets,
Return on Equity, the Efficiency Ratio and the Fee Income Ratio. A target is
established for each performance ratio. Participants earn a 10% bonus for
each target ratio achieved, or if the actual performance ratio is in the 75th
percentile or better relative to the Company's "Peer Group," as defined in the
Plan. If the targeted ratio is not reached but the actual performance ratio
is in the 60th to 74.99th percentile relative to the Company's Peer Group, the
Participants earn a bonus of 5% of base compensation for each such performance
ratio. Participants cannot receive a bonus for the Fee Income Ratio unless
they qualify for a bonus under at least one of the other three performance
ratios. Stock options are the Company's primary long-term compensation
program designed to reward executive performance consistent with performance
that benefits stockholders. Awards of stock options are intended to provide
executives with increased motivation and incentive to exert their best efforts
on behalf of the Company by enlarging their personal stake in its success
through the opportunity to increase their stock ownership in the Company.
Options issued to executives are at a price equal to the closing price of the
Company's stock on the date of grant in order to insure that any value derived
from the grant is realized by stockholders generally. The amount of options
granted to an executive officer is based on the officer's performance and
relative responsibilities within the Company. Options may be exercisable
immediately but generally vest over a period of years.
During the fiscal year ended June 30, 1998, the base compensation of
Robert W. Pullo, President and Chief Executive Officer of the Company was
$360,490 which represented a nine percent increase from the previous fiscal
year. Profit sharing and bonus distributions were awarded based on plan
provisions.
Compensation Committee
THOMAS W. WOLF CAROLYN E. STEINHAUSER
PAUL D. MILLS ROBERT W. ERDOS
RANDALL A. GROSS
-11-
Performance Graph. The following graph compares the Company's
cumulative stockholder return on its Common Stock with the return on the
National Association of Securities Dealers Automated Quotation ("Nasdaq")
(U.S. companies) Index and a peer group comprised of SIC Code 603-SAVINGS
INSTITUTIONS (publicly traded). Total return assumes the reinvestment of all
dividends.
[Graph appears here]
Period Ending
---------------------------------------------------------
Index(1) 6/30/93 6/30/94 6/30/95 6/30/96 6/30/97 6/30/98
- ------------------------------------------------------------------------------
York Financial
Corp. $100.00 $117.54 $102.20 $114.53 $154.69 $207.82
SIC Code Index(2)(3) 100.00 118.00 137.17 173.17 279.32 379.19
Nasdaq Market
Index(2) 100.00 109.66 128.61 161.89 195.02 258.52
___________________
(1) Source: Media General Financial Services
(2) Both the Market Index and the Industry Index contain only those
companies that are public and that have been public for the required
six year time frame.
(3) Peer Group includes SIC Code 603-SAVINGS INSTITUTIONS (publicly
traded).
- ------------------------------------------------------------------------------
Indebtedness of Management to the Association
- ------------------------------------------------------------------------------
Applicable law and regulations require that all loans or extensions of
credit to executive officers and directors must be made on substantially the
same terms, including interest rates and collateral, as those prevailing at
the time for comparable transactions with other persons (unless the loan or
extension of credit is made under a benefit program generally available to all
employees and does not give preference to any insider over any other employee)
and does not involve more than the normal risk of repayment or present other
unfavorable features. The Association has adopted a
-12-
policy to this effect. At June 30, 1998, loans to all employees, officers and
directors of the Association totalled $11,640,622.
- ------------------------------------------------------------------------------
Compliance With Section 16(a) of The Exchange Act
- ------------------------------------------------------------------------------
Section 16(a) of the Exchange Act requires certain officers of the
Company and its directors, and persons who beneficially own more than 10% of
any registered class of the Company's Common Stock, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
and the Company.
Based solely on a review of the reports and written representations
provided to the Company by the above referenced persons, the Company believes
that all filing requirements applicable to its reporting officers, directors
and greater than 10% beneficial owners were properly and timely complied with
during the fiscal year ended June 30, 1998, except for certain transactions by
Robert C. Herzberger, Senior Vice President of the Company, and Robert A.
Angelo, Executive Vice President of the Company. Mr. Herzberger
inadvertently failed to file two Form 4 Statement of Change in Beneficial
Ownership of Securities ("Form 4") for transactions during the months of
November 1997 and June 1998, which were subsequently filed on February 2, 1998
and July 16, 1998, respectively. Mr. Angelo inadvertently failed to file a
Form 4 for transactions during the month of November 1997, which was
subsequently filed on December 19, 1997.
- ------------------------------------------------------------------------------
Independent Auditors
- ------------------------------------------------------------------------------
Ernst & Young LLP served as the Company's independent auditors for the
fiscal year ended June 30, 1998. The Company has appointed Ernst & Young LLP
as independent auditors for the fiscal year ending June 30, 1999. A
representative of Ernst & Young LLP is expected to be present at the Meeting
to respond to questions from stockholders and will have the opportunity to
make a statement if he or she so desires.
- ------------------------------------------------------------------------------
Other Matters
- ------------------------------------------------------------------------------
The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matters should properly come before the Meeting, it is
intended that proxies in the accompanying form will be voted in respect
thereof in accordance with the judgment of the person or persons voting the
proxies.
The cost of solicitation of proxies will be borne by the Company. In
addition to solicitations by mail, directors, officers, and regular employees
of the Company may solicit proxies personally or by telegraph or telephone
without additional compensation.
- ------------------------------------------------------------------------------
Financial Statements
- ------------------------------------------------------------------------------
The Company's Annual Report to Stockholders, including consolidated
financial statements prepared in conformity with generally accepted accounting
principles, is being mailed herewith to all stockholders of record as of the
close of business on the Voting Record Date. Any stockholder who has not
received a copy of such Annual Report may obtain a copy by writing the
Company. Such Annual Report is not to be treated as a part of the proxy
solicitation material nor as having been incorporated herein by reference.
A COPY OF FORM 10-K AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WILL
BE FURNISHED WITHOUT CHARGE TO STOCKHOLDERS AS OF THE RECORD DATE UPON WRITTEN
-13-
REQUEST TO JAMES H. MOSS, SENIOR VICE PRESIDENT, CHIEF FINANCIAL
OFFICER/TREASURER, YORK FINANCIAL CORP., 101 SOUTH GEORGE STREET, P.O. BOX
15068, YORK, PENNSYLVANIA 17405.
- ------------------------------------------------------------------------------
Stockholder Proposals
- ------------------------------------------------------------------------------
In order to be eligible for inclusion in the proxy materials of the
Company for next year's Annual Meeting of Stockholders, any stockholder
proposal to take action at such meeting must be received at the Company's main
office at 101 South George Street, P.O. Box 15068, York, Pennsylvania 17405,
no later than June 1, 1999. Any such proposals shall be subject to the
requirements of the proxy rules adopted under the 1934 Act.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ROBERT A. ANGELO
ROBERT A. ANGELO
SECRETARY
York, Pennsylvania
September 28, 1998
-14-
REVOCABLE PROXY
YORK FINANCIAL CORP.
This Proxy is Solicited on Behalf of the Board of Directors for the Annual
Meeting of Stockholders on October 28, 1998.
The undersigned hereby appoints Robert W. Erdos, Carolyn E. Steinhauser and
Robert L. Simpson of the Board of Directors of York Financial Corp. with full
powers of substitution to act, as attorneys and proxies for the undersigned,
to vote all shares of Common Stock of York Financial Corp. which the
undersigned is entitled to vote at the Annual Meeting of Stockholders, to be
held at the Lafayette Room, Yorktowne Hotel, 48 East Market Street, York,
Pennsylvania on Wednesday, October 28, 1998 at 3:00 p.m. and at any and all
adjournments thereof as follows:
Should the undersigned be present and elect to vote at the Meeting or at any
adjournment thereof and after notification to the Secretary of the Company at
the Meeting of the stockholder's decision to terminate this proxy, then the
power of said attorneys and proxies shall be deemed terminated and of no
further force and effect.
This Proxy also relates to shares held under the York Financial Corp. Dividend
Reinvestment and Stock Purchase Plan.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. 0
1. ELECTION OF DIRECTORS For
Nominees: Cynthia A. Dotzel All Withheld Except
Paul D. Mills 0 0 0 ----------------------
Byron M. Ream
This proxy will be voted as directed. If no
direction is made, it will be voted "FOR" the
proposal set forth above. The Board of
Directors recommends a vote "FOR" the
proposal. If any other business is presented
at the meeting, this proxy will be voted by
the proxy holders in their best judgment.
Dated _______ __, 1998
----------------------------------------------
----------------------------------------------
NOTE: Please sign exactly as name appears
hereon. Joint owners should each sign. When
signing as a fiduciary or for an estate,
trust, corporation or partnership, your title
or capacity should be stated.