-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, B9wfZRGMOAxYY60F0T4RQID2LtW1ac9ObWhgev8Cl7LFk5zeIcLGUgt4EtX9DTdP jBwAJMUfHC9RjeoO5D/RAg== 0000001985-96-000004.txt : 19960430 0000001985-96-000004.hdr.sgml : 19960430 ACCESSION NUMBER: 0000001985-96-000004 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960429 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACCEL INTERNATIONAL CORP CENTRAL INDEX KEY: 0000001985 STANDARD INDUSTRIAL CLASSIFICATION: LIFE INSURANCE [6311] IRS NUMBER: 310788334 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-08768 FILM NUMBER: 96552981 BUSINESS ADDRESS: STREET 1: 475 METRO PLACE N CITY: DUBLIN STATE: OH ZIP: 43017 BUSINESS PHONE: 6147647000 MAIL ADDRESS: STREET 1: 475 METRO PLACE NORTH CITY: DUBLIN STATE: OH ZIP: 43017 FORMER COMPANY: FORMER CONFORMED NAME: ACCELERATION CORP DATE OF NAME CHANGE: 19870814 10-K/A 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-K/A AMENDMENT NO. 1 (Mark One) [X] ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED) FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED) FOR THE TRANSITION PERIOD FROM TO --------------- ---------------- COMMISSION FILE NUMBER 0-8162 ACCEL INTERNATIONAL CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 31-0788334 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 475 METRO PLACE NORTH, DUBLIN, OHIO 43017 (Address of principal executive offices) (Zip Code) 614-764-7000 (Registrant's Telephone Number) SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: None SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: Title of each class ------------------- COMMON STOCK, $.10 PAR VALUE Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. --- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ----- ----- The aggregate market value of Common Stock held by non-affiliates on January 31, 1996 was approximately $7,280,000. As of January 31, 1996, there were 4,456,432 shares of Common Stock, $.10 par value per share outstanding. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The executive officers, their respective ages and business experience are as follows: Thomas H. Friedberg (56), Chairman of the Board, President and Chief Executive Officer; Douglas J. Coats (62), Executive Vice President; Nicholas Z. Alexander (60), Senior Vice President, Secretary and General Counsel; Larry L. Main (47), Senior Vice President-Auto After Market Group; Kurt L. Mueller (47), Vice President and Controller; and Alan M. Weiner (45), Vice President and Treasurer. Mr. Friedberg joined the Company on May 23, 1995, when he was appointed Chairman & CEO. He was also appointed President as of October 15, 1996. Prior thereto, he was Chairman, President and CEO of Ranger Insurance Company, Houston, Texas for more than five years. Mr. Coats joined the Company on May 23, 1995, when he was appointed Executive Vice President and a member of the Board of Directors. Prior thereto, he was Executive Vice President of Ranger Insurance Company, Houston, Texas for more than five years. Mr. Alexander was named Senior Vice President, Secretary and General Counsel of the Company in 1992 and prior thereto was Vice President, Secretary and General Counsel of the Company for more than five years. Mr. Main was named Senior Vice President in 1992 and prior thereto was Vice President of the Company for more than five years. Mr. Mueller was named Vice President and Controller of the Company in 1994 and prior thereto had been Vice President-General Accounting of the subsidiaries of the Company for more than five years. Mr. Weiner was named Treasurer of the Company in 1994 and prior thereto had been Vice President-Reinsurance Accounting of the subsidiaries of the Company for more than five years. The following Table sets forth certain information relating to the Directors of the Company:
Name, Position with the Principal Occupation for Director Number of shares of Common Stock owned Percent Company and Age (as of past five years/other Since beneficially, directly or indirectly, of Class January 31, 1996) Directorships on January 31, 1996 (except as otherwise noted) (1) Robert Betagole President of Mike Albert 1970 49,529 (5) 1.1% Director, 67 Leasing, Inc., Cincinnati, OH. David T. Chase (2) President and Chief 1985 4,500 (6) * Director, 66 Executive Officer of D.T. Chase Enterprises, Inc., Hartford, CT. Douglas J. Coats Executive Vice President 1995 -- -- Director, 63 of the Company since May 23, 1995. Prior thereto he was Executive Vice President of Ranger Insurance Company, Houston, TX since August, 1987. Raymond H. Deck (2)(3)(4) President of Chase 1990 98,815 2.2% Director, 73 Insurance Enterprises, Inc., Hartford, CT. Also, is a director of SCOR U.S.and Scor Re, New York, NY. Robert E. Fowler, III Senior Vice President, 1995 -- -- Director, 37 Chase Enterprises, Hartford, CT, since July, 1990. Prior thereto, he was a Vice President, CITIBANK, N.A., New York, NY Thomas H. Friedberg (2) Chairman of the Board and 1995 10,000 * President, 57 Chief Executive Officer Chief Executive Officer and of the Company since May Director 23, 1995. Appointed President as of October 15, 1996. Prior thereto he was Chairman of the Board, President and Chief Executive Officer of Ranger Insurance Company, Houston, TX, since January, 1987. Kermit G. Hicks (2)(3)(4) President of Hicks 1981 28,087 (7) * Director, 60 Chevrolet, Inc., Greencastle, PA. Also, Chairman of the Board of Tower Bancorp Inc., and its wholly owned subsidiary First National Bank of Greencastle. Stephen M. Qua (2)(3)(4) President of Qua 1970 18,698 (8) * Director, 63 Buick/Suzuki, Inc. Cleveland, OH. Milton J. Taylor, Sr. President of the Taylor 1991 6,500 (9) * Director, 69 Team of Dealerships, Lancaster, OH: Taylor Chevrolet, Inc., and Milt Taylor Lincoln-Mercury, Inc. Paul R. Whitters Consultant. Retired 1991 5,050 * Director, 70 President of Frankona Reinsurance Company, Kansas City, MO. All Directors and Officers 366,502 (10) 8.2% as a group (14 persons) (1) On January 31, 1996, there were 4,456,432 shares of the Company Common Stock issued and outstanding. Except as noted, includes shares owned by spouse, minor children or certain other family members, or held as custodian or trustee for the benefit of spouse or children, or owned by corporations of which such person is an officer or principal stockholder, over which shares such directors have sole or shared voting or investment power. With respect to each Director other than Messrs. Coats, Fowler and Friedberg, includes an aggregate of 31,500 shares which are subject to immediately exercisable options. (2) Member of Executive Committee (Mr. Friedberg, Chairman). (3) Member of Audit Committee (Mr. Qua, Chairman). (4) Member of Compensation Committee (Mr. Deck, Chairman). (5) Includes 7,581 shares as to which Mr. Betagole disclaims beneficial ownership. (6) David T. Chase disclaims beneficial ownership, for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the "Act"), of 1,351,454 shares of Common Stock or 30.3% of the shares outstanding, owned by Chase Insurance Holdings Corporation ("CIHC"), which is a wholly-owned subsidiary of American Ranger, Inc. ("ARI"). ARI is owned 100% by D.T. Chase Enterprises, Inc. ("DTCE"), which is owned by David T. Chase (33.95%), his wife Rhoda L. Chase (2.21%), his son, Arnold L. Chase (9.34%), and his daughter, Cheryl Chase Freedman (14.74%), the Arnold Chase Accumulation Trusts I and II and the David T. Chase Sprinkling Trusts IA through VA of which Arnold L. Chase and Stanley N. Bergman are co-trustees (20.15% in the aggregate), and the Cheryl Chase Freedman Accumulation Trusts I and II and the David T. Chase Sprinkling Trusts IB through VB of which Cheryl Chase Freedman and Stanley N. Bergman are co-trustees (19.61% in the aggregate). Pursuant to an agreement, CIHC has loaned 812,842 shares of Common Stock to ARI which has full use of the borrowed shares, including the right to sell, pledge or otherwise transfer the shares until termination of the agreement. Mr. Chase also disclaims beneficial ownership for purposes of Section 13(d) of the Act, of 382,000 shares of Common Stock, or 8.6% of the shares outstanding, owned by Rhoda L. Chase. Pursuant to an agreement, Rhoda L. Chase has loaned 335,000 shares of Common Stock to Insurance Holdings Limited Partnership ("IHLP") which has full use of the borrowed shares, including the right to sell, pledge or otherwise transfer the shares until termination of the agreement. The general partner of IHLP is Chase Insurance Corporation ("CIC"). David T. Chase, Arnold L. Chase and Cheryl Chase Freeman are executive officers of CIC. In filings on Schedule 13D with respect to the Company's Common Stock, Rhoda L. Chase, ARI, CIHC and IHLP have each stated that such person has not agreed to act together with any of the foregoing persons or with any other person or entity for the purpose of acquiring, holding, voting or disposing of shares of Common Stock, and disclaims membership in any "group" with respect to the Common Stock for purposes of Section 13(d)(3) of the Exchange Act or Rule 13d-5(b)(1) adopted thereunder. If such a group were deemed to exist, the group would be deemed to beneficially own all shares of Common Stock beneficially owned by each such person. (7) Includes 8,696 shares as to which Mr. Hicks claims beneficial ownership on an indirect basis. (8) Includes 1,894 shares as to which Mr. Qua disclaims beneficial ownership. (9) Includes 1,000 shares as to which Mr. Taylor claims beneficial ownership on an indirect basis. (10) This amount includes 122,342 shares which are subject to immediately exercisable options and 22,481 shares owned by officers in their Acceleration Retirement Savings and Stock Ownership Plan accounts as of December 31, 1995. * Less than 1% of outstanding Common Stock.
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act") requires the Company's officers and directors, and persons who own more than 10% of the Common Stock, to file reports of ownership and changes in ownership with the Securities and Exchange Commission (the "SEC"). Officers, directors and greater than 10% stockholders are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file. Based solely on its review of the copies of such forms received by it or written representations from certain reporting persons that no Forms 5 were required of them, the Company believes that during the fiscal year ended December 31, 1995, all filing requirements applicable to its officers, directors and greater than 10% stockholders were complied with, except that two reports covering an initial statement of beneficial ownership and one transaction were filed late by Mr. Coats. ITEM 11. EXECUTIVE COMPENSATION Summary ------- The following table is a summary of certain information concerning the compensation awarded or paid to, or earned by, the Company's chief executive officer and each of the Company's other three most highly compensated executive officers whose total annual salary and bonus for the fiscal year ended December 31, 1995, exceeded $100,000 (the "named executives") during each of the last three fiscal years: SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation Year Name, Age, and Principal Salary ($) Bonus ($) Securities All Other Position Underlying Compensation Options/SARs (#) ($)(2) 1995 Thomas H. Friedberg, 57 (1) -- -- 100,000 -- 1994 Chairman of the Board, -- -- -- -- 1993 President and Chief Executive -- -- -- -- Officer 1995 R. Max Williamson, 58 (3) 225,000 -- 15,000 4,240 1994 Chairman of the Board, 225,000 -- 15,000 7,294 1993 President and Chief Executive 225,000 -- 15,000 6,152 Officer 1995 Larry L. Main, 47 Senior Vice 112,000 -- 10,000 2,639 1994 President Auto After Market 112,000 -- 10,000 2,605 1993 Product Group 112,0000 -- 10,500 3,064 1995 Nicholas Z. Alexander, 60 109,000 -- 10,000 4,093 1994 Senior Vice President, 109,000 -- 10,000 4,061 1993 Secretary and General Counsel 109,000 -- 10,500 2,980 1995 William B. Johnson, 43 (4) 108,000 -- 10,000 2,144 1994 Senior Vice President Claims 108,000 -- 10,000 2,112 1993 108,000 -- 10,500 1,734 (1) Mr. Friedberg was appointed Chairman of the Board and Chief Executive Officer of the Company on May 23, 1995. He accepted appointment to such offices without entitlement to salary for the first year of the appointment. In lieu of salary, he was granted a stock option for 100,000 shares of Common Stock which vested immediately, becomes exercisable one year following the date of grant, and lapses five years from the date of grant. (2) Represents approximate amounts contributed on behalf of each such executive to the Acceleration Retirement Savings and Stock Ownership Plan. (3) Mr. Williamson relinquished his positions with the Company as of October 15, 1995. Pursuant to the provisions of his Employment Agreement with the Company, his compensation thereunder will continue until February 28, 1997. (4) Mr. Johnson resigned effective December 31, 1995.
The following table sets forth information concerning individual grants of options to purchase the Company's Common Stock made to the named executives in 1995: OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS IN 1995 Potential Realizable Value at Assumed Annual Rates of Stock Price Appreciation for Option Term Name Number of Percent of Exercise or Expiration 5% ($) 10% ($) Securities Total Base Price Date Underlying Options ($ Sh) (1) Options/SARs Granted to Granted (#) Employees in Fiscal Year Thomas H. Friedberg 100,000 43.0% $2.125 5/23/00 $58,710 $129,733 R. Max Williamson 15,000 6.5% $2.125 Expired N/A N/A Larry M. Main 10,000 4.3% $2.125 5/23/05 $13,364 $33,867 Nicholas Z. Alexander 10,000 4.3% $2.125 5/23/05 $13,364 $33,867 William B. Johnson 10,000 4.3% $2.125 Expired N/A N/A (1) Market price of the Company's Common Stock on date of grant.
The following table sets forth certain information regarding individual exercises of stock options during 1995 by each of the named executives: AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
Name Shares Value Number of Securities Value of Unexercised Acquired on Realized Underlying Unexercised Options In-The-Money Options at Fiscal Exercise (Mkt. Price at Fiscal Year End (#) Year End (1) (#) at Exercise Less Exercise Price) Exercisable Unexercisable Exercisable Unexercisable Thomas H. Friedberg 0 N/A 0 100,000 0 $62,500 R. Max Williamson 0 N/A N/A N/A N/A N/A Larry L. Main 0 N/A 35,931 14,000 $6,250 N/A Nicholas Z. Alexander 0 N/A 39,404 14,000 $6,250 N/A William B. Johnson 0 N/A N/A N/A N/A N/A (1) Intended to represent the amount by which the market price of the Company's Common Stock on December 31, 1995 ($2.75), exceeded the exercise prices of unexercised options on that date.
Employment Agreement On August 1, 1990, the Company entered into an employment agreement with R.Max Williamson pursuant to which Mr. Williamson served as Chairman, President and Chief Executive Officer of the Company. The term of the agreement was for a period of three years and provided that, unless terminated in accordance with the provisions thereof, on the first day of each month that the agreement was in effect, the remaining term thereof would automatically be extended one additional month. On December 13, 1993, the Board of Directors notified Mr. Williamson that the employment agreement would be terminated on February 28, 1997. Mr. Williamson's base salary under the agreement was $225,000 per year. In addition to a base salary, the agreement provided for a cash bonus and other employee benefits to be provided Mr. Williamson. Mr. Williamson relinquished his positions with the Company as of October 15, 1995. Pursuant to the provisions of this employment agreement with the Company, his compensation thereunder will continue until February 28, 1997. Compensation of Directors During 1995, non-employee directors of the Company continued to abide by the one-third reduction in compensation levels initiated in 1993, and accordingly received an annual retainer of $5,000 plus a fee of $500 per meeting for attending any regular or special meetings of the Board of Directors. The members of each committee of the Board of Directors, other than officers of the Company, received a fee of $500 for each meeting attended. Chairmen of committees received a fee of $750 for each meeting attended. The First Restatement of ACCEL International Corporation 1987 Stock Incentive Plan (the "Restated Plan") provides for options to be granted every year to non-employee directors of the Company for a predetermined number of shares of Common Stock. In 1991, the year the Restated Plan was adopted, the non-employee directors were granted options for 2,000 shares each. In subsequent years, options for 1,000 shares each were granted and will continue to automatically be granted according to the Restated Plan (subject to adjustment for stock dividends, stock splits and other similar events). Newly appointed or elected non-employee directors are granted options for 2,000 shares in the year they are appointed or elected, and thereafter will receive the automatic grants. The exercise price is equal to the fair market value of a share of stock on the date the option is granted. Options become exercisable as to 50% of the shares subject to the option on completion of each full year prior to termination of the director's status as director after the date the option was granted. The options lapse on the earliest of the date 10 years after the option was granted, or the date 180 days after the termination of the director's status as director. The options shall fully vest and become completely exercisable upon the death or voluntary retirement of a director. Compensation Committee Interlocks and Insider Participation Mr. Qua is associated with two automobile dealerships which are master policyholders of the Company and receive commissions from the Company in connection with credit insurance sold by such dealerships. During the fiscal year ended December 31, 1995, such dealerships received commissions in the amount of $91,670 ITEM 12 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth certain information regarding the named executive's beneficial ownership of the Common Stock of the Company as of January 31, 1996: Shares of Common Stock of Company Beneficially Owned Title of Class Name of Officer Number (1) Percent of Class Common Stock Thomas H. Friedberg 10,000 * Common Stock R. Max Williamson 5,419 * Common Stock Larry L. Main 46,854 1% Common Stock Nicholas Z. 44,642 1% Alexander Common Stock William B. Johnson N/A N/A (1) The amounts shown represent the total shares owned outright by such individuals together with shares which are issuable upon the exercise of all stock options which are currently exercisable. Specifically, the following individuals have the right to acquire the shares indicated after their names, upon the exercise of such stock option: Mr. Main, 39,404; Mr. Alexander, 35,931. * Less than 1% of outstanding Common Stock. The following table sets forth certain information as of January 31, 1996 (except as otherwise noted) with respect to stockholders known to the Company to be the beneficial owners of more than five percent of any class of the Company's voting securities:
Title of Class Name and Address of Beneficial Owner Amount of Beneficial Percent of Class Ownership (1) Common Stock Chase Insurance Holdings Corporation 1,351,459 Shares (2) 30.3% One Commercial Plaza Hartford, CT 06103 Rhoda L. Chase 382,000 (2) 8.6% 96 High Ridge Road West Hartford, CT 06117 Dimensional Fund Advisors Inc 315,119 Shares (3) 7.1% 1299 Ocean Avenue 11th Floor Santa Monica, CA 90401 Tweedy, Browne Company L.P. and TBK 246,000 Shares (4) 5.5% Partners, L.P. 52 Vanderbilt Avenue New York, NY 10017 (1) Except as otherwise noted, the Company has no reason to believe that any beneficial owner listed above does not have sole voting and investment power with respect to these shares. (2) As of January 31, 1996. See footnote (6) in Item 10 hereof. (3) Dimensional Fund Advisors Inc. ("Dimensional"), a registered investment advisor, is deemed to have beneficial ownership of 315,119 shares of ACCEL International Corporation stock as of December 31, 1995, all of which shares are held in portfolios of DFA Investment Dimensions Group Inc., a registered open-end investment company, or in series of the DFA Investment Trust Company, a Delaware business trust, or the DFA Group Trust and DFA Participation Group Trust, investment vehicles for qualified employee benefit plans, all of which Dimensional Fund Advisors Inc. serves as investment manager. Dimensional disclaims beneficial ownership of all such shares. (4) Tweedy, Browne Company L.P. ("TBC"), a registered broker-dealer and registered investment advisor, and TBK Partners, L.P. ("TBK"), have jointly filed amendments to their respective Schedule 13D Reports (the "Schedule 13D") with the SEC. The Schedule 13D stated that TBC may be deemed to have beneficial ownership of 246,000 shares, all of which shares are held in accounts of various customers of TBC. TBC further reported that it has investment discretion with respect to all 246,000 shares and sole power to vote 171,000 shares. As a result of a disposition of shares, TBK reported that it does not beneficially own any shares. Each of TBC and TBK disclaimed beneficial ownership of the 246,000 shares held in the TBC accounts and disclaimed beneficial ownership of the shares held by the other. TBK and TBC also reported that their respective general partners, four of whom are common to each, may, solely by reason of their positions as such, be deemed to share voting power and dispositive power with respect to the shares. Finally TBC and TBK stated that the filing of the Schedule 13D should not be deemed an admission that TBC and TBK comprise a group within the meaning of Section 13(d)(3) of the Act.
Information concerning official ownership of Common Stock of the Company is included in the Table set forth under Item 10 hereof. ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Several of the Company's directors are associated with automobile dealerships. These dealerships are master policyholders of the Company and receive commissions from the Company in connection with credit insurance sold by them. All commissions paid to automobile dealerships and agencies associated with the Company's directors are at rates determined on a basis consistent with commissions paid to non-related parties. Total commission on credit insurance business paid to all agencies relating to all directors as a group during the year ended December 31, 1995 was $180,231. The following table sets forth those directors whose agencies received commissions in connection with the credit insurance business of the Company in excess of $60,000 in the year 1995: DIRECTOR 1994 Stephen M. Qua $91,670 Milton J. Taylor, Sr. $88,561 Also, an insurance agency of which Robert Betagole is a shareholder, received $1,734,913 through a reinsurance arrangement. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. ACCEL INTERNATIONAL CORPORATION By: /S/ Kurt L. Mueller ------------------------------------ Kurt L. Mueller Vice President & Controller Date: April 29, 1996 ----------------------------------- Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. -----END PRIVACY-ENHANCED MESSAGE-----