-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, O+yv2gbtPhjFQQGPdm2wENsHbH0IfB3pNybGkIX6Ga06yzfj4lztdcgYAw/3Xdpr FXLR2lEk0DIn0WktpeLRGQ== 0000891092-95-000034.txt : 19950505 0000891092-95-000034.hdr.sgml : 19950505 ACCESSION NUMBER: 0000891092-95-000034 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19950607 FILED AS OF DATE: 19950428 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MOTOR CLUB OF AMERICA CENTRAL INDEX KEY: 0000068480 STANDARD INDUSTRIAL CLASSIFICATION: 6331 IRS NUMBER: 220747730 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 1934 Act SEC FILE NUMBER: 000-00671 FILM NUMBER: 95532806 BUSINESS ADDRESS: STREET 1: 484 CENTRAL AVE CITY: NEWARK STATE: NJ ZIP: 07107 BUSINESS PHONE: 2017331234 MAIL ADDRESS: STREET 1: 484 CENTRAL AVENUE CITY: NEWARK STATE: NJ ZIP: 07107 DEF 14A 1 DEFINITIVE PROXY STATEMENT SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(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 ss.240.14a-11(c) or ss.240.14a-12 Motor Club of America ----------------------------------------------- (Name of Registrant as Specified In Its Charter) Motor Club of America --------------------------------------- (Name of Person Filing Proxy Statement) Payment of Filing Fee (Check the appropriate box): |x| $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2). |_| $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). |_| Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. 1) Title of each class of securities to which transaction applies: ----------------------------------------------------------------------- 2) Aggregate number of securities to which transaction applies: ----------------------------------------------------------------------- 3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11: ----------------------------------------------------------------------- 4) Proposed maximum aggregate value of transaction: ----------------------------------------------------------------------- |_| Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. 1) Amount Previously Paid: --------------------------------------------------------------------------- 2) Form, Schedule or Registration Statement No.: --------------------------------------------------------------------------- 3) Filing Party: --------------------------------------------------------------------------- 4) Date Filed: --------------------------------------------------------------------------- MOTOR CLUB OF AMERICA 484 CENTRAL AVENUE NEWARK, NEW JERSEY 07107 [LOGO] ------------------------------ NOTICE OF ANNUAL MEETING OF STOCKHOLDERS June 7, 1995 ------------------------------ TO THE HOLDERS OF COMMON STOCK OF MOTOR CLUB OF AMERICA: NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Motor Club of America (the Company) will be held at the principal office of the Company, 484 Central Avenue, Newark, New Jersey, on Wednesday, June 7, 1995, at 10:00 o'clock A.M. (Newark Time), for the following purposes: 1. To elect eight (8) directors of the Company to hold office until the 1996 Annual Meeting of Stockholders and until their successors shall have been duly elected and qualified; and 2. To transact such other business as may properly come before the meeting or any adjournment thereof. The Board of Directors has fixed the close of business on April 27, 1995, as the record date for the determination of the holders of Common Stock entitled to notice of and to vote at the meeting If you cannot be present in person, your management would greatly appreciate your filling in, signing and returning the enclosed proxy, in the envelope provided for the purpose, in time to arrive no later than June 6, 1995. Any proxy not received by that date may arrive too late to be voted at the meeting. By Order of the Board of Directors PETER K. BARBANO Secretary Dated: Newark, New Jersey May 4, 1995 MOTOR CLUB OF AMERICA 484 CENTRAL AVENUE NEWARK, NEW JERSEY 07107 ----------------- PROXY STATEMENT ----------------- Annual Meeting of Stockholders June 7, 1995 ----------------- This statement is furnished in connection with the solicitation of proxies by the management of MOTOR CLUB OF AMERICA for use at the 1995 Annual Meeting of Stockholders to be held on June 7, 1995, and at any and all adjournments thereof. The Board of Directors has selected the close of business on April 27, 1995 as the record date, for purposes of determining shareholders entitled to notice of, and entitled to vote at the Annual Meeting, and this proxy statement is being mailed to such shareholders on or about May 4, 1995. On the record date, there were 2,043,004 shares of Common Stock of the Company outstanding, all of the par value of $.50 per share and each entitled to one vote on any matter to be voted on at the meeting. Other than the election of directors, which requires a plurality of the votes cast, each matter to be submitted to the stockholders requires the affirmative vote of a majority of the votes cast at the meeting. For purposes of determining the number of votes cast with respect to a particular matter, only those cast "For" or "Against" are included. Abstentions and broker non-votes are counted only for purposes of determining whether a quorum is present at the meeting. If the enclosed form of proxy is properly executed and returned in time to be voted at the meeting, the shares represented thereby will be voted. The attendance at the meeting by any stockholder who has previously given a proxy will not have the effect of revoking the proxy; however, any such stockholder may vote in person by delivering written notice of revocation of the proxy to the Secretary of the Company prior to the exercise of the proxy. Election of Directors At the meeting eight directors are to be elected to hold office until the 1996 Annual Meeting of Stockholders, and until their successors have been duly elected and qualified. It is the intention of the persons named in the enclosed form of proxy to vote the shares represented thereby for the election of the following nominees as directors of the Company. Each of the nominees is a member of the Board of Directors of the Company. The principal occupations of Messrs. Galatin, Fried, Lobeck, McWhorter, Pratt and Swanner for the last five years appear below; Messrs. Gilbert and Haveron devote substantially all of their business time to the affairs of the Company or one or more other companies in the Motor Club of America Group, and have been active in the business of one or more companies in the Motor Club of America Group for more than five years. Should any of these nominees be unable or unwilling to accept nomination or election for any presently unknown reason, it is the intention of the persons named in this proxy to vote for such other person or persons as the management of the Company may nominate.
Common Stock of the Company Owned Beneficially at March 31, 1995 ---------------------- Years in Which Nominee Has Served Number as Director of This of Percent Name and Age Principal Occupations Company (Inclusive)(A) Shares(B) of Class ------------ --------------------- ---------------------- --------- -------- Archer McWhorter, 73 ..... Chairman of the Board of Directors of Companies in 1986-1995 301,635 14.76 the Motor Club of America Group; President of the Company; consultant (to 1994) of Thrifty Rent-A- Car System, Inc. (Thrifty), a car rental company; Director (to November 1992) of Baggage, Inc., an airline service and security company; President of Acceptance, Inc., a finance company; from April 1995, one-third owner of NCR Acquisition Corpora- tion (NCR), which entered agreement to purchase National Car Rental, a car rental company Stephen A. Gilbert, 56(C) Executive Vice President, General Counsel and Chief 1984-1995 10,500 .51 Operating Officer of the Company; President of Companies in the Motor Club of America Group Robert S. Fried, 65(C) ... Retired Senior Vice President (to May 1992) of 1956-1995 1,000 .05 Companies in the Motor Club of America Group William E. Lobeck, Jr., 55 President of The Numbered Car Co., a car dealership, 1986-1995 289,601 14.18 and Chairman of Environmental Fuels Technologies, L.L.C., a distributor of automotive alternative fuel systems and supplier of fueling equipment; to February 1993: President of Pentastar Transporta- tion Group, Inc., Chairman of the Board of Dollar Rent A Car Systems, Inc. and Snappy Car Rental, Inc., car rental companies; President (to 1993) of Thrifty; from April 1995, one-third owner of NCR James D. Pratt, 54 ....... Chairman of the Board of Italix Management Corpora- 1986-1995 26,833 1.31 tion; Chief Executive Officer of Alpha-Century Aviation, Inc., an aviation company; Vice Pres- ident of Copra Media Productions, Inc., a media production company Alvin E. Swanner, 66 ..... Vice Chairman of the Board (to December 1993) of 1986-1995 301,634 14.76 Companies in the Motor Club of America Group; consultant (to 1994) of Thrifty; President (to 1993) of Swanner & Associates, Inc., a car rental company; President of Chateau, Inc., a golf and country club, and Chateau Development Company, Inc., a development company; from April 1995, one- third owner of NCR Malcolm Galatin, 55 ...... Professor of Economics, The City College of The City 1987-1995 -- -- University of New York Patrick J. Haveron, 33 (C) Vice President and Chief Financial Officer of Com- 1994-1995 600 .03 panies in the Motor Club of America Group; Treasurer of Motor Club of America Insurance Company and subsidiary
2 Following is stock ownership information of officers of the Company who are listed in the compensation tables that follow, but who are not included in the Director tabulations above.
Common Stock of the Company Owned Beneficially at March 31, 1995 ----------------------- Number of Percent Name Title Shares (B) of Class ---- ----- ---------- -------- George B. Myers, 68 ........... Vice President--Claims -- -- Myron Rogow, 52 ............... Vice President--Underwriting -- --
- - -------------- (A) Includes years during any portion of which the nominee served as director. (B) As reported to the Company by the named persons. The nature of beneficial ownership for shares shown in this Proxy Statement is sole voting and investment power, except 2,000 shares owned by two trusts, of which Mr. Lobeck is the trustee. (C) Member of Finance Committee. The following table sets forth the number of outstanding shares of Common Stock of the Company beneficially owned, directly or indirectly, by persons known to the Company to be a beneficial owner of more than five percent of such stock at March 31, 1995.
Shares Beneficially Percent Name and Address Owned of Class ---------------- ------------ -------- Archer McWhorter ......................................................... 301,635 14.76 1600 Smith Street Houston, Texas 77002 William E. Lobeck, Jr. ................................................... 289,601 14.18 1132 South Lewis Tulsa, Oklahoma 74104 Alvin E. Swanner ......................................................... 301,634 14.76 28 Chateau Haut Brion Street Kenner, Louisiana 70065
The following table shows the number of outstanding shares of equity securities in the Company beneficially owned at March 31, 1995, by all 16 directors and officers of the Company as a group:
Shares Beneficially Percent Title of Class Owned of Class -------------- ------------ -------- Motor Club of America Common Stock (par value $.50 per share) .................. 933,803 45.71
3 One of the Company's insurance subsidiaries, MCA Insurance Company (MCAIC) was declared insolvent on October 23, 1992 as a result of claims of Hurricane Andrew, which struck the South of Florida coast on August 24, 1992. The Company wrote off in 1992 its investment in MCAIC and its subsidiaries, Property-Casualty Company of MCA and Fairmount Central Urban Renewal Corporation. The directors and executive officers of the Company, with the exception of Malcolm Galatin, were directors and executive officers of MCAIC. Committees of the Board The Executive Committee serves as a policy-making and supervisory body for all operations of the Company, has all the eligible powers of the Board of Directors between meetings of the Board and also acts as the nominating committee. Shareholders who wish to suggest nominees for director should write to the Secretary of the Company at 484 Central Avenue, Newark, New Jersey 07107, stating in detail the qualifications of such persons for consideration by the Committee. The Compensation and Evaluation Committee administers executive compensation and bonus plans; it met two times during 1994. The Stock Option Plan Committee administers the 1987 and 1992 Stock Option Plans and met one time during 1994. The Executive and Stock Option Plan Committees are comprised of Archer McWhorter, William E. Lobeck, Jr. and Alvin E. Swanner. The Compensation and Evaluation Committee is comprised of William E. Lobeck, Jr. and Alvin E. Swanner. The Audit Committee, which is comprised of Malcolm Galatin, Robert S. Fried and James D. Pratt, assesses the Company's risk of fraudulent financial reporting and management's program to monitor compliance with the code of corporate conduct, participates in the recommendation of independent public accountants and reviews the audit plans of the internal auditor and independent public accountants. The Audit Committee met three times during 1994. The Board of Directors of the Company met on seven occasions during 1994. During 1994, none of the incumbent directors attended less than 75% of the aggregate of (1) the total number of meetings of the Board ( held during the period for which he has been a director) and (2) the total number of meetings of all committees of the Board on which he served (during the period that he served). Directors' Compensation Each non-employee director receives $1,000 per month from Companies in the Motor Club of America Group. Directors who are also employees do not receive any amount, in addition to their compensation, for being directors. Each member of the Executive Committee receives $4,000 per month from Companies in the Motor Club of America Group; and each non-employee member of the Audit and Finance Committee receives $250 per meeting. 4 Executive Compensation Tables The following tables provide information about executive compensation. SUMMARY COMPENSATION TABLE The following table sets forth information about the compensation of the chief executive officer and each of the four most highly compensated executive officers of the Company for services in all capacities to the Company and its subsidiaries.
Long Term Compensation Annual Compensation Award (2) ------------------------ ------------- (a) (b) (c) (d) (e) (f) Securities Underlying All Other Options/ Compen- Names and principal Salary Bonus (1) SAR's (3) sation (4) Position Year ($) ($) (#) ($) ------------------- ---- ------- --------- ----------- ---------- Archer McWhorter ............... 1994 60,000 0 0 0 Chairman of the Board 1993 78,000 0 0 0 and President 1992 78,000 0 0 0 Stephen A. Gilbert Executive Vice President 1994 155,000 85,209 0 6,930 General Counsel and 1993 155,000 30,000 7,500 4,497 Chief Operating Officer 1992 155,000 0 10,000 3,425 Myron Rogow .................... 1994 125,000 34,359 0 3,354 Vice President-- 1993 125,000 15,000 3,750 4,200 Underwriting 1992 117,775 0 5,000 1,702 George B. Meyers ............... 1994 100,000 27,487 0 3,311 Vice President-- 1993 100,000 12,500 3,750 3,375 Claims 1992 96,911 0 5,000 2,258 Patrick J. Haveron ............. 1994 105,000 57,722 0 2,780 Vice President and Chief 1993 90,000 17,500 3,750 3,242 Financial Officer 1992 89,064 0 5,000 1,863
- - -------------- (1) Bonus amounts shown were earned with respect to the year indicated but may have been paid in the following year. (2) The Company does not have a restricted stock award plan or a long term incentive award plan other than certain stock option plans. (3) Amounts shown represent the number of stock options granted each year; there are no stock appreciation rights. (4) Amounts shown represent Company contributions for the account of each named executive officer under the 401(k) Plan, a tax-qualified defined contribution plan open to all salaried employees of the Company and certain subsidiaries upon completion of one year of service. OPTION/SAR GRANTS IN LAST FISCAL YEAR There were no grants of options in 1994. 5 AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION SAR VALUES The following table provides information as to options exercised by each of the named executive officers of the Company during 1994 and the value of options held by such officers at year end measured in terms of the closing price of the Company Common Stock on December 31, 1994.
(a) (b) (c) (d) (e) Number of Securities Underlying Unexercised Value of Unexercised Shares Options/SAR's at Fiscal In-the-Money Option/SAR's Acquired Value Year-End (2)(#) at Fiscal Year-End(2),(3)($) on Exercise Realized (1) ---------------------------- ---------------------------- Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable ---- ----------- ------------ ----------- ------------- ----------- ------------- Archer McWhorter (4) ..................... N/A N/A N/A N/A 0 0 Stephen A. Gilbert ....................... 0 0 12,500 5,000 938 0 Myron Rogow .............................. 0 0 6,250 2,500 469 0 George B. Meyers ......................... 0 0 6,250 2,500 469 0 Patrick J. Haveron ....................... 0 0 6,250 2,500 469 0
- - -------------- (1) No stock options were exercised in 1994. (2) No SAR's have ever been issued. (3) The values shown equal the difference at December 31, 1994 between the exercise price of unexercised in-the-money options and the closing market price of the underlying Common Stock. Options are in-the-money if the fair market value of the Common Stock exceeds the exercise price of the option. (4) Mr. McWhorter does not have any Company stock options. LONG TERM INCENTIVE PLANS--AWARDS IN LAST FISCAL YEAR The Company does not maintain any Long Term Incentive Plans other than stock option plans previously disclosed. STOCKHOLDER RETURN PERFORMANCE GRAPH Set forth on the following page is a line graph comparing the cumulative total stockholder return on the Company's Common Stock against the cumulative total return of the Center for Research in Security Prices at The University of Chicago Graduate School of Business (CRSP) Index for NASDAQ Stock Market (United States Companies) and the CRSP Index for NASDAQ Fire, Marine & Casualty Insurance for the period of five years commencing December 29, 1989 and ending December 30, 1994. The graph and table assume that $100 was invested on December 29, 1989 in each of the Company's Common Stock, the CRSP Index for the NASDAQ Stock Market (United States Companies) and the CRSP Index for the NASDAQ Fire, Marine & Casualty Insurance. This data was furnished by CRSP. 6 Comparison of Five Year-Cumulative Total Years Returns Performance Graph for MOTOR CLUB OF AMERICA [THE FOLLOWING PARAGRAPH WAS REPRESENTED BY A GRAPH IN THE PRINTED MATERIAL] Motor Club CSRP Index for CSRP Index for Date of America Nasdaq Stock Market Nasdaq Stocks ---- ---------- ------------------- -------------- 12/29/89 100.0 100.0 100.0 12/31/90 55.6 84.9 95.6 12/31/91 73.9 136.3 135.7 12/31/92 16.0 158.6 182.5 12/31/93 32.0 180.9 188.6 12/30/94 35.2 176.9 181.9 7 Executive Compensation Report of the Compensation and Evaluation Committee and Stock Option Plan Committee on Executive Compensation The Compensation and Evaluation Committee was charged by the Board of Directors with administering salaries and other compensation for executive officers. The Stock Option Plan Committee administers the Company's incentive stock option programs. For the purposes of insuring continuity in the application of the Company's compensation philosophy, both Committees (hereinafter referred to as the Committee) have identical membership, with Mr. McWhorter also being a member of the Stock Option Plan Committee. COMPENSATION PHILOSOPHY There are several guiding principles of the Committee in performing its functions. The Company's compensation philosophy is to provide a competitive salary and other remuneration tied to Company performance against operating goals in order to attract and retain quality insurance executives. Stock options are provided to executives to offer additional incentive compensation commensurate with Company performance. The Committee believes this compensation philosophy properly balances its executives' incentives to provide short-term operating performance. The Company's radically changed financial circumstances directly affect the application of this philosophy. While the structure of the philosophy remains intact, the Company's return to financial health is the preeminent concern of the Committee, and all compensation decisions derive from this concern. COMPONENTS OF EXECUTIVE COMPENSATION The Company's executive compensation program consists of: (i) an annual salary, (ii) a short-term incentive in the form of participation in the Annual Incentive Program and (iii) a long-term incentive in the form of stock options. Salary The Committee believes the Company has attracted executive officers with talent and expertise which exceed the Company's current operating environment and market scope. The wealth of talent and expertise has enabled the Company to survive the extraordinary regulatory and operating circumstances which have beset it in recent years. Accordingly, these executive officers are paid an annual salary which is commensurate with their industry expertise, functional expertise and value in the insurance marketplace. Historically, many factors have been used to determine annual salary increases. Such factors include Company performance, the Company's operating plan and objectives thereunder, individual performance, Company performance in relation to the industry, and the regulatory environment in which the Company operates. In addition, exceptional performance by an individual, whether or not it has a direct impact on Company performance, is taken into account in setting salary increases. 8 During recent years, the Company has in general employed a cap on the maximum increase any employee, including executive officers, may receive over the previous year's salary. The Company has utilized this strategy in order to control its expenses. In order to control expenses further and assist with the Company's financial recovery, the Committee eliminated all salary increases for calendar year 1993, including executive officers' salaries; for calendar year 1994 and 1995, the Committee has eliminated virtually all salary increases for key and executive officers. The Committee does not believe these salary actions will be detrimental to the Company's long-term prospects. The Committee further believes that total compensation for executives and key officers should primarily be determined by Company performance and that the Annual Incentive Program (AIP) should be the featured additional remuneration component for these individuals, as opposed to salary. Stock Options Stock options are granted as a means of providing executive officers and key employees long term benefits and incentives from an improvement in Company share performance. The options are granted at the market value of the stock on the date of grant. Thus, the options gain value only to the extent the stock price exceeds the option price during the life of the option. Options are awarded in a manner which maintains the executive's focus on long-term share performance. The Committee is of the opinion that it would be in the Company's best interests if such options continue to be granted. Many of the principal competitors of the Company have adopted and now have in operation stock option plans. The plans are used as incentive devices by corporations which wish to attract new management , to convert their officers into "partners" by giving them a stake in the business, to retain the services of executives who might otherwise leave and to give their employees generally a more direct interest in the success of the corporation. The Committee believes that executives are more attuned to the concerns of shareholders if they participate in the ownership function; stock options are a method of providing such an opportunity to participate. Annual Incentive Program The Company also offers an AIP which provides incentive compensation tied to the profitability of the Company against a performance factor which is derived from the Company's calendar year Budget and Profit Plan. The Compensation Committee selected participants in the 1994 AIP who perform functions which directly affect the ability of the Company to meet its business and performance objectives. Under the 1994 AIP, because income before Federal income taxes for the year was within a specific range as compared to the performance factor, bonuses of varying percentages of salary, adjusted to reflect individual performance, have been paid to the participants, including executive officers, during 1995. The Committee reserves the right to withdraw the AIP in total or an executive's participation in the AIP at any time. The Committee has established an AIP for 1995 and its terms and performance factor are effective only for 1995. 9 The 1995 AIP will offer incentive compensation tied to the profitability of the Company against a performance factor which is derived from the Company's calendar year Budget and Profit Plan. The Compensation Committee selected participants in the 1995 AIP who perform functions which directly affect the ability of the Company to meet its business and performance objectives. Under the 1995 AIP, if income before Federal income taxes for the year is within a specific range as compared to the performance factor, bonuses of varying percentages of salary, adjusted to reflect individual performance, will be paid to participants during 1996. Archer McWhorter does not participate in any AIP. The executive officers named in the Summary Compensation Table are participating in the AIP in 1995. CHIEF EXECUTIVE OFFICER AND OTHER COMPENSATION Other than compensation received as a result of his position as a director of the Company, Archer McWhorter, the Chairman of the Board and President, does not receive any compensation nor is it presently contemplated that Mr. McWhorter receive any other compensation. The Committee believes this approach will contribute to the Company's financial recovery. The function which Mr. McWhorter performs as chief executive officer can thus enhance Company performance without increasing Company expenses or reducing the Company's operating results and performance. Accordingly, there were no factors or criteria upon which Mr. McWhorter's compensation is based. William E. Lobeck, Jr. Alvin E. Swanner Compensation and Evaluation Committee Interlocks and Insider Participation William E. Lobeck, Jr. and Alvin E. Swanner, who are members of the Compensation and Evaluation Committee and the Stock Option Plan Committee, were paid director's fees and certain expenses of $136,530 and $60,000, respectively, during 1994. There are no Compensation and Evaluation Committee interlocks. Retirement Plan and Certain Transactions In 1954, the Company established an Employees' Retirement Plan (Pension Plan), which as amended covers employees with one year's service and provides annual retirement benefits based on salary and length of service to companies in the Motor Club of America Group. The Pension Plan was amended as of January 1992 to suspend benefit accruals. The trustees of the Pension Plan, which is non-contributory, are Robert S. Fried, Stephen A. Gilbert and Patrick J. Haveron. The trustees have purchased guaranteed investment group annuity contracts and United States Government obligations to fund Pension Plan benefits. 10 The annual Pension Plan benefits payable upon retirement at or after the normal retirement age of 65 consist of an amount equal to the sum as of January 1992 of: (a) 11/2% of the first $12,000 of an employee's average annual compensation plus 21/4% in excess of $12,000, multiplied by the employee's years of plan participation prior to January 15, 1983; and (b) For each plan year after January 15, 1983, 13/4% of the first $13,200 of the employee's annual compensation plus 23/4% in excess of $13,200. Early retirement is available at age 55 with 15 years of service. A participant's Pension Plan benefits become 100% vested after five years of service. Pension Plan amounts are not subject to deductions for Social Security benefits or other offset amounts. The following table sets forth certain information relating to the Pension Plan with respect to the four most highly compensated executive officers of the Company who are participants in the Pension Plan (Archer McWhorter is not a participant in the Pension Plan):
Estimated Annual Latest Remuneration Credited Years Name Benefit at Age 65 Covered by the Plan (1) of Service (1) ---- ----------------- ----------------------- --------------- Stephen A. Gilbert ............... $52,650 $175,000 24 Myron Rogow ...................... 9,500 113,950 4 George B. Meyers ................. 35,000 92,700 41 Patrick J. Haveron ............... 4,950 79,500 4
- - -------------- (1) As of January 1992 when Pension Plan accruals were suspended. The only director or executive officer, or member of the immediate family, whose aggregate indebtedness during 1994 to Companies in the Motor Club of America Group exceeded $60,000 at any one time, was Dante Bediones, brother of Norma Rodriguez. The largest aggregate amount of such indebtedness during 1994 was $73,751. The aggregate amount of indebtedness at January 1, 1995 was $69,275, secured by a first mortgage made November 1985, on improved real estate, bearing interest at the rate of 9% per annum. Other Business The management of the Company knows of no other matters which may be presented at the meeting. However, if any matter not now known should come before the meeting, it is intended that the persons named in the enclosed form of proxy, or their substitutes, will vote the shares represented by them in accordance with their judgment on such matter. Financial Statements Available A copy of the Annual Report of the Company for 1994, which contains financial statements audited by the Company's independent public accountants, is being sent to all stockholders with this proxy statement. A copy of the Company's 1994 Annual Report on Form 10-K filed with the Securities and Exchange Commission is available without charge upon written request to the Chief Financial Officer of the Company, 484 Central Avenue, Newark, New Jersey 07107. 11 Relationship with Independent Public Accountants The Board of Directors has selected the firm of Coopers & Lybrand L.L.P. as the Company's principal independent public accountant for the year of 1995. One or more members of this firm will attend the Annual Meeting, will have the opportunity to make a statement if they so desire and will be available to answer questions that may be asked by stockholders. Proposals of Stockholders In order for proposals of stockholders to be included in the proxy materials for presentation at the 1996 Annual Meeting of Stockholders, such proposals must be received by the Company no later than March 5, 1996. Cost of Solicitation The costs of the meeting, including the solicitation of proxies, will be borne by the Company. Proxies will be solicited by mail, and may also be solicited, without extra compensation, by certain directors, officers and regular employees of the Company, by mail, telephone, telegraph, telecopy or personally. Arrangement will be made with brokerage houses and other custodians, nominees and fiduciaries to forward proxy soliciting material to the beneficial owners of stock held of record by such persons, and the Company may reimburse them for reasonable out-of-pocket expenses incurred by them in doing so. If you cannot be present in person, your management would greatly appreciate your filling in, signing and returning the enclosed proxy, in the envelope provided for the purpose, in time to arrive not later than June 6, 1995. Any proxy not received by that date may arrive too late to be voted at the meeting. By Order of the Board of Directors PETER K. BARBANO, Secretary Dated: Newark, New Jersey May 4, 1995 12 APPENDIX A
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF [LOGO] MOTOR CLUB OF AMERICA for the Annual Meeting of Stockholders June 7, 1995 PROXY: ARCHER McWHORTER, ALVIN E. SWANNER, WILLIAM E. LOBECK, JR. AND STEPHEN A. GILBERT, and each of them are hereby appointed as attorneys and proxies, with full power of substitution, to represent and to vote all stock of MOTOR CLUB OF AMERICA (the Company) in the name of the undersigned, as fully and effectively as the undersigned could do if personally present, at the Annual Meeting of Stockholders of the Company, to be held at the office of the Company, 484 Central Avenue, Newark, New Jersey 07107, on June 7, 1995 at 10 o'clock A.M. (Newark Time), and at any adjournment thereof, upon the matters set forth in the Proxy Statement, which has been received by the undersigned, as indicated on the reverse side hereof, and in their discretion in the transaction of such other business as may properly come before the meeting or any adjournment thereof. (Please mark, sign and date the reverse side and return promptly in the envelope provided)
Election of directors (Mark Only One Box). Nominees: A. McWhorter, S.A. Gilbert, R.S. Fried, M. Galatin, W.E. Lobeck, Jr., J.D. Pratt, A.E. Swanner, P.J. Haveron [ ] Vote FOR all nominees listed above and recommended by the Board of Directors, EXCEPT vote withheld from the following nominees (if any): [ ] Vote WITHHELD from all nominees. .......................................................................... If no indication is made, the proxies shall vote FOR the election of the director nominees. Please sign here personally, exactly as your name appears hereon. Joint owners must both sign. DATED 19 --------------------------------- -- SIGNED -------------------------------------- SIGNED --------------------------------------
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