Home News Local News DISSIDENT SHAREHOLDER'S CANDIDATE WINS SEAT ON PIONEER BANK BOARD
DISSIDENT SHAREHOLDER'S CANDIDATE WINS SEAT ON PIONEER BANK BOARD
By Mike Ferguson
For the Observer
BAKER CITY The candidate backed by a dissident shareholder of Pioneer Banks holding company won a seat on the board of the directors Friday.
Kevin Padrick of Sunriver pledged to be an independent director who works for the interest of all shareholders.
Also winning election during Fridays annual meeting was John Gentry, an Ontario automobile dealer who has served the board of Oregon Trail Financial Corp., Pioneer Banks holding company, since 1992.
Padrick replaces John Lienkaemper, also of Ontario, who had been a board member since 1979.
The board of directors has six members. Padrick will be seated at the boards meeting later this month, according to board chairman Stephen Whittemore of La Grande.
The exact results of the voting were not announced in a press release issued by the company Friday.
Padrick owns a Central Oregon business consulting firm and holds both a law degree and a masters degree in business administration. His candidacy was backed by Joseph Stilwell, a New York investment fund manager and OTFCs largest shareholder.
Stilwell has been critical of the strategy of both the board and the companys management team since last year. Earlier in 2001, he sued board members Ed Elms of Baker City and Chuck Rouse, formerly of Baker City.
The Rouse lawsuit centered on Rouse moving out of the banks service area and continuing to serve on the board. The Elms suit was over Elms testimony in a deposition taken during the Rouse proceedings. Both lawsuits have been dismissed.
Stilwell, who was in attendance Friday but chose not to speak during the meeting, gave Padrick 20,000 shares of stock options in exchange for Padricks willingness to run for a seat on the board, Padrick said after the meeting.
Padrick said he intended to ask probing questions during board meetings, but said he wasnt elected to the board to shake things up.
But he also noted that he wouldnt rule out any options for strategies he might advocate to increase shareholder value including the sale of the company.
Ill always make my voice heard, just as I expect every director makes his voice heard on the board, Padrick said.
After the meeting had concluded, Stilwell said he was pleased, but not surprised by Padricks election.
We knew the vote total, more or less, he said. I think the message that shareholders have sent is pretty clear: they want to maximize value, and theyve elected Kevin in order to do that.
Stilwell said he was confident that Padrick would help improve the company despite being just one voice on the board.
If theyre rational men, the best argument will carry the day, he said.
They have been kind and open since I got here (Wednesday).
Stilwell said he intended to remain a substantial shareholder in the company even after Padricks election. According to forms filed with the Securities and Exchange Commission, Stilwells company, Stilwell Associates, LLP, owns more than 300,000 shares of OTFC, nearly a 9 percent stake in the company.
The stock was trading at 16 at the close of the market Friday, up .05.
Volume was 2,500 shares.
After the meeting, Whittemore said the board will have to evaluate the message that Padricks election sends to the board and its management team. The companys performance over the past year has been great, he said, noting a presentation during the annual meeting by OTFC President and Chief Executive Officer Berniel Maughan.
Maughan said that growth highlights for the 2001 fiscal year (ending March 31) included a 62 percent rise in the banks commercial loans and a 7 percent rise in total deposits over 2000 during a time when banks in our peer group are challenged.
With nearly $400 million in assets, Pioneer Bank has branches in nine communities, including La Grande, Island City and Enterprise.