SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED COMMISSION FILE NO. 0-16084 DECEMBER 31, 1996 CITIZENS & NORTHERN CORPORATION (Exact name of registrant as specified in its charter) PENNSYLVANIA 23-2451943 (State of Incorporation) (Employer Identification Number) ADDRESS OF PRINCIPAL EXECUTIVE OFFICE: THOMPSON STREET RALSTON, PA 17763 MAILING ADDRESS OF EXECUTIVE OFFICE: 90-92 MAIN STREET WELLSBORO, PA 16901 REGISTRANT'S TELEPHONE NUMBER (INCLUDING AREA CODE): 717-265-6171 SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: COMMON STOCK, PAR VALUE $1.00 A SHARE (Title of class) 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 shorter periods 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 |_|. Indicate by check mark if the disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the 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. |X| The number of shares outstanding of the issuer's class of common stock as of March 1, 1997: $1.00 Par Value 5,062,453 Shares The aggregate market value of the registrant's common stock held by non-affiliates at 1, 1997 : $134,155,005
DOCUMENTS INCORPORATED BY REFERENCE: Portions of the Annual Report to Shareholders for the Year Ended December 31, 1996 (Annual Report) are incorporated by reference into Parts I and II Portions of the Proxy Statement for the Annual Shareholders Meeting to be held April 15, 1997 (Proxy Statement) are incorporated by reference into Part III Location in Form 10-K Incorporated Information Part II Item 5. Market for Registrant's Common Page 43 of the Annual Stock and Related Stockholder Matters Report Item 6. Selected Financial Data Pages 43 and 44 of the Annual Report Item 7. Management's Discussion and Analysis Page 28 through 42 of the of the Financial Condition and Results Annual Report of Operations Item 8. Financial Statements and Page 6 through 25 and page Supplementary Data 44 of the Annual Report Part III Item 10. Directors and Executive Officers Page 2 through 5 of the of the Registrant Proxy Statement Item 11. Executive Compensation Page 5 through 9 of the Proxy Statement Item 12. Security Ownership of Certain Page 3 through 5 of the Beneficial Owners and Management Proxy Statement Item 13. Certain Relationships and Related Page 23 of the Annual Report Transactions Page 11 of the Proxy Statement Number of pages, not including Cover Page, is 10 1
PART I ITEM 1. BUSINESS The information appearing in the Annual Report under the caption "Description of Business" on page 47 is herein incorporated by reference. Regulation and Supervision The Corporation The Corporation is a one-bank holding company formed under the provisions of Section 3 of the Federal Reserve Act. The Corporation is under the direct supervision of the Federal Reserve Board and must comply with the reporting requirements of the Federal Bank Holding Company Act. A one-bank or multi-bank holding company is prohibited under Section 3 (a)(3) of the Act from acquiring either directly or indirectly 5% or more of the voting shares of any bank or bank holding company without prior Board approval. Additionally, Section 3 (a)(3) prevents, without prior Board approval, an existing bank holding company from increasing its ownership in an existing subsidiary bank unless a majority (greater than 50 percent) of the shares are already owned (Section 3 (a)(B) ). A bank holding company which owns more than 50 percent of a bank's shares may buy and sell those shares freely without Board approval, provided the ownership never drops to 50 percent or less. If the holding company owns 50 percent or less of a bank's shares, prior Board approval is required before such additional acquisition of shares takes place until ownership exceeds 50 percent. Under current Pennsylvania law, which became effective March 4, 1990, bank holding companies located in any state may acquire banks and bank holding companies located in Pennsylvania provided that the laws of such state grant reciprocal rights to Pennsylvania bank holding companies and that 75% of the domestic deposits are located in a state granting reciprocity. The Bank The Bank is a state chartered nonmember bank, supervised by and under the reporting requirements of the Pennsylvania Department of Banking and the Federal Deposit Insurance Corporation. ITEM 2. PROPERTIES The Bank fully owns fifteen (15) banking offices as listed below. All offices have been modernized to meet the demands for the Bank's services and to give a pleasant and comfortable atmosphere in which to conduct the Bank's business. 1. Executive Offices - 90-92 Main Street, Wellsboro, PA 16901 2. Corporate Headquarters - Thompson Street, Ralston, PA 17763 3. 428 South Main Street, Athens, PA 18810 4. 111 Main Street, Dushore, PA 18614 5. Main Street, East Smithfield, PA 18817 6. Main Street, Elkland, PA 16920 7. Route 49, Knoxville, PA 16928 8. Main Street, Laporte, PA 18626 9. Route 15, Liberty, PA 16930 10. Route 220, Monroeton, PA 18832 11. RD 2, Sayre, PA 18840 12. Route 15, Tioga, PA 16946 2
13. 428 Main Street, Towanda, PA 18848 14. Elmira and East Main Street, Troy, PA 16947 15. Route 6, Wysox, PA 18854 All offices offer a full range of banking services, except the Monroeton office, which does not offer safe deposit boxes. There are no encumbrances against any of the properties owned by the Bank. ITEM 3. LEGAL PROCEEDINGS None ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this Report. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER MATTERS The information appearing in the Annual Report under the caption "Quarterly Share Data" on page 43 and the "Summary of Quarterly Financial Data" on page 45 is herein incorporated by reference. ITEM 6. SELECTED FINANCIAL DATA The "Five Year Summary of Operations" on page 44 of the Annual Report is herein incorporated by reference. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information appearing in the Annual Report under the caption "Management's Discussion and Analysis of the Financial Condition and Results of Operations" on pages 28 through 42, is incorporated herein by reference. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The Consolidated Financial Statements (and footnotes thereto) and the Summary of Quarterly Financial Data presented in the Annual Report is herein incorporated by reference. ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable. 3
PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT (a) Identification of Directors. The information appearing under the caption "Election of Directors" on pages 2 through 4 of the Corporation's Proxy Statement dated March 17, 1997, is herein incorporated by reference. (b) Identification of Executive Officers. The information appearing under the caption "Corporation's and Bank's Executive Officers" on pages 5 and 6 of the Corporation's Proxy Statement dated March 17, 1997, is herein incorporated by reference. ITEM 11. EXECUTIVE COMPENSATION Information appearing under the caption "Executive Compensation" on page 7 of the Corporation's Proxy Statement dated March 17, 1997, is herein incorporated by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Information appearing under the caption "Election of Directors" on pages 2 through 4 and under the caption "Corporation's and Bank's Executive Officers" on pages 4 through 6 of the Corporation's Proxy Statement is herein incorporated by reference. ITEM 13. CERTAIN RELATIONSHIPS AND CERTAIN TRANSACTIONS Information appearing in footnote 12 to the Consolidated Financial Statements included on page 23 in the Annual Report is herein incorporated by reference. Information appearing under the caption "Certain Transactions" on page 11 of the Corporation's Proxy Statement is herein incorporated by reference. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K (a) (1). The following consolidated financial statements and reports are set forth in Item 8. Page Report of Independent Certified Public Accountants 26 Financial Statements: Consolidated Balance Sheet - December 31, 1996 and 1995 6 Consolidated Statement of Income - Years Ended December 31, 1996, 1995 and 1994 7 Consolidated Statement of Changes in Stockholders' Equity - Years Ended December 31, 1996, 1995 and 1994 8 Consolidated Statement of Cash Flows - Years Ended December 31, 1996, 1995 and 1994 9 Notes to Consolidated Financial Statements 8 - 25 4
(2). Financial statement schedules are either omitted because inapplicable or included in the financial statements or related notes. Individual financial statements of Bucktail Life Insurance Company, a consolidated subsidiary have been omitted, as neither the assets nor the income from continuing operations before taxes exceed ten percent of the consolidated totals. (3). Exhibits (numbered as in Item 601 of Regulation S-K) 2. Plan of Acquisition, Reorganization, Arrangement, Liquidation or Succession Not applicable 3. (i) Articles of Incorporation * 3. (ii) Bylaws of the Registrant * 4. Articles of Incorporation of the Registrant as Currently in effect * 9. Voting Trust Agreement Not applicable 10. Material Contracts Not applicable 11. Statement re Computation of Per Share Earnings Not applicable 12. Statements re Computation of Ratios Not applicable 13. Annual Report to Shareholders 16. Letter re Change in Certifying Accountant Not applicable 18. Letter re Change in Accounting Principles Not applicable 21. List of Subsidiaries 22. Published Report Regarding Matters Submitted to Vote of Security Holders Not applicable 23. Consents of Experts and Counsel Not applicable 24. Power of Attorney Not applicable 27. Financial Data Schedules 28. Information from Reports Furnished to State Insurance Regulatory Authorities Not applicable 99. Additional Exhibits Not applicable (b) Reports on Form 8-K No reports on Form 8-K were filed during the quarter ended December 31, 1996. *omitted in the interest of brevity 5
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. CITIZENS & NORTHERN CORPORATION March 20, 1997 By: CRAIG G. LITCHFIELD /s/ -------------- ------------------------------ Date Craig G. Litchfield President and Chief Executive Officer 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. March 20, 1997 By: JAMES W. SEIPLER /s/ -------------- ------------------------------ Date James W. Seipler Treasurer 6
BOARD OF DIRECTORS J. ROBERT BOWER /s/ JOHN H. MACAFEE /s/ - ------------------------------------- ----------------------------------- J. Robert Bower John H. Macafee R. ROBERT DECAMP /s/ LAWRENCE F. MASE /s/ - ------------------------------------- ----------------------------------- R. Robert DeCamp Lawrence F. Mase R. JAMES DUNHAM /s/ ROBERT J. MURPHY /s/ - ------------------------------------- ----------------------------------- R. James Dunham Robert J. Murphy ADELBERT E. ELDRIDGE /s/ EDWARD H. OWLETT, III /s/ - ------------------------------------- ----------------------------------- Adelbert E. Eldridge Edward H. Owlett, III WILLIAM K. FRANCIS /s/ F. DAVID PENNYPACKER /s/ - ------------------------------------- ----------------------------------- William K. Francis F. David Pennypacker KARL W. KROECK /s/ LEONARD SIMPSON /s/ - ------------------------------------- ----------------------------------- Karl W. Kroeck Leonard Simpson EDWARD L. LEARN /s/ DONALD E. TREAT /s/ - ------------------------------------- ----------------------------------- Edward L. Learn Donald E. Treat CRAIG G. LITCHFIELD /s/ - ------------------------------------- Craig G. Litchfield 7
EXHIBIT INDEX 3.(i) Articles of Incorporation of the Registrant as currently in effect are herein incorporated by reference to Exhibit D to Registrant's Form S-4, Registration Statement dated March 27, 1987. 3.(ii) Bylaws of the Registrant as currently in effect are herein incorporated by reference to Exhibit E to Registrant's Form S-4, Registration Statement dated March 27, 1987. 4. Articles of Incorporation of the Registrant as currently in effect are herein incorporated by reference to Exhibit D to Registrant's Form S-4, Registration Statement dated March 27, 1987. 10. Page 29 of Registrant's Form S-4, Registration Statement dated March 27, 1987, is herein incorporated by reference. 13. Annual Report to Shareholders 21. List of Subsidiaries 8