UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrantþx
Filed by a Party other than the Registranto¨
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| Definitive Proxy Statement |
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Community Bankers Trust Corporation
(Name of Registrantregistrant as Specifiedspecified in Its Charter)
(Name of Person(s) Filing Proxy Statementperson(s) filing proxy statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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You are cordially invited to attend the 20092010 Annual Meeting of Stockholders of Community Bankers Trust Corporation to be held on Thursday,Tuesday, June 18, 2009,22, 2010, at 10:00 a.m. at The Place at Innsbrook, 4036 Cox Road, Glen Allen, Virginia 23060.
At the Annual Meeting, you will be asked to elect fourthree directors for terms of three years each. You will also be asked to approve an amendment to the Company’s Certificate of Incorporation, approve a non-binding resolution to endorse the Company’s executive compensation program approve the Community Bankers Trust Corporation 2009 Stock Incentive Plan and ratify the appointment of Elliott Davis, LLC as the Company’s independent registered public accounting firm for the 20092010 year. Enclosed with this letter are a formal notice of the Annual Meeting, a proxy statement and a form of proxy.
Whether or not you plan to attend the Annual Meeting, it is important that your shares be represented and voted. Please complete, sign, date and return the enclosed proxy promptly using the enclosed postage-paid envelope. The enclosed proxy, when returned properly executed, will be voted in the manner directed in the proxy. You can also vote your shares by voting through the internet or by telephone by following the instructions on your proxy card.
We hope that you will participate in the Annual Meeting, either in person or by proxy.
| Sincerely, | ||||
 | ||||
| George M. Longest, Jr. | ||||
| President and Chief Executive Officer | ||||
| Glen Allen, Virginia | ||||
| May 24, 2010 | ||||
4235 Innslake Drive, Suite 200
Glen Allen, Virginia 23060
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of Community Bankers Trust Corporation will be held on Thursday,Tuesday, June 18, 2009,22, 2010, at 10:00 a.m., local time, at The Place at Innsbrook, 4036 Cox Road, Glen Allen, Virginia 23060, for the following purposes:
| (1) | The election of | ||
| (2) | |||
| The approval of the following advisory (non-binding) proposal: |
RESOLVED, that the stockholders approve the compensation of executive officers as disclosed in this proxy statement pursuant to the rules of the Securities and Exchange Commission.
| (3) | The ratification of the appointment of Elliott Davis, LLC as the Company’s independent registered public accounting firm for the | ||
| (4) | The transaction of any other business that may properly come before the meeting and any adjournments or postponements of the meeting. |
If you were a stockholder of record at the close of business on May 5, 2009,2010, then you are entitled to vote at the Company’s Annual Meeting and any adjournments or postponements of the meeting. You are also cordially invited to attend the meeting.
Your vote is important. Whether or not you plan to attend the meeting, please vote as soon as possible. You can vote your shares by completing and returning your proxy card or by voting through the internet or by telephone by following the instructions on your proxy card. For additional details, please see the information under the heading “How do I vote?”
| By Order of the Board of Directors, | ||||
 | ||||
| John M. Oakey, III | ||||
| Secretary | ||||
| May 24, 2010 | ||||
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE STOCKHOLDER MEETING TO BE HELD ON JUNE 18, 2009:
The proxy statement is available on the Company’s investor web site
at http://www.cbtrustcorp.com
www.cbtrustcorp.com.
This proxy statement is being furnished to the holders of common stock, par value $0.01 per share, of Community Bankers Trust Corporation, a Delaware corporation. Proxies are being solicited on behalf of the Board of Directors of the Company to be used at the 20092010 Annual Meeting of Stockholders. The Annual Meeting will be held at The Place at Innsbrook, 4036 Cox Road, Glen Allen, Virginia 23060, on Thursday,Tuesday, June 18, 2009,22, 2010, beginning at 10:00 a.m. local time, for the purposes set forth in the Notice of Annual Meeting of Stockholders.
sm or “TAC,”sm the Company was formed to effect a merger, capital stock exchange, asset acquisition or other similar business combination with an operating business in the banking industry. Prior to its acquisition of two bank holding companies in 2008, the Company’s activities were limited to organizational matters, completing its initial public offering and seeking and evaluating possible business combination opportunities. On May 31, 2008, the Company acquired each of TransCommunity Financial Corporation, a Virginia corporation (“TransCommunity Financial”), and BOE Financial Services of Virginia, Inc., a Virginia corporation (“BOE Financial”). The Company changed its corporate name in connection with the acquisitions.
THE ANNUAL MEETING AND VOTING
Why did I receive these proxy materials?
This proxy statement will be mailed to holders of the Company’s common stock on or about May 20, 2009.27, 2010. The Company’s Board of Directors is asking for your proxy. By giving the Company your proxy, you authorize the proxyholders (George M. Longest, Jr., Bruce E. Thomas and John M. Oakey, III) to vote your shares at the Annual Meeting according to the instructions that you provide. If the Annual Meeting adjourns or is postponed, your proxy will be used to vote your shares when the meeting reconvenes.
The Company’s 20082009 Annual Report to Stockholders, which includes a copy of the Company’s Annual Report on Form 10-K for the year ended December 31, 20082009 (excluding exhibits), as filed with the Securities and Exchange Commission, is being mailed to stockholders with this proxy statement.
May I attend the Annual Meeting?
All stockholders are invited to attend the meeting. It will be held on Thursday,Tuesday, June 18, 2009,22, 2010, beginning at 10:00 a.m. local time, at The Place at Innsbrook, 4036 Cox Road, Glen Allen, Virginia 23060.
Even if you plan to attend the Annual Meeting, please vote your proxy in advance through the internet, by telephone or by mail.
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If you are a stockholder of the Company’s common stock at the close of business on the Record Date of May 5, 2009,2010, you can vote. There were 21,468,455 shares of common stock outstanding and entitled to vote on that date. For each matter properly brought before the Annual Meeting, you have one vote for each share that you own.
What is the difference between holding shares as a stockholder of record and as a beneficial owner?
If your shares are registered directly in your name with the Company’s transfer agent, Continental Stock Transfer & Trust Company, you are considered, with respect to those shares, the “stockholder of record.” The Notice of Annual Meeting of Stockholders, this proxy statement and the 2009 Annual Report to Stockholders have been sent directly to you by the Company.
If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the “beneficial owner” of shares held in “street name.” The Notice of Annual Meeting of Stockholders, this proxy statement and the 2009 Annual Report to Stockholders have been forwarded to you by your broker, bank or other nominee who is considered, with respect to those shares, the “stockholder of record.” As the beneficial owner, you have the right to direct your broker, bank or other nominee on how to vote your shares using the voting instruction card included in the mailing or by following the instructions on that card for voting by telephone or through the internet.
How do I vote?
You may vote using any of the following methods:
Telephone –You can vote by calling the toll-free telephone number on your proxy card. Please have your proxy card in hand when you call. Easy-to-follow voice prompts allow you to vote your shares and confirm that your instructions have been properly recorded.
Internet –You can vote by visiting the web site for internet voting listed on your proxy card. Please have your proxy card available when you go online.
Mail –Be sure to sign and date the proxy card and return it in the enclosed postage-paid envelope.
In person –You may vote in person at the Annual Meeting.
A valid proxy, if not revoked, will be votedFOR the election of the nominees for director named in this proxy statement,FOR the approval of an amendment to the Company’s certificate of incorporation to increase the number of authorized shares of common stock,FOR the approval of a non-binding resolution to endorse the Company’s executive compensation program andFOR the approval of the Company’s 2009 Stock Incentive Plan andFOR the ratification of the appointment of Elliott Davis, LLC as the Company’s independent registered public accounting firm for the Company’s 20092010 year.
If your shares are held in “street name,” do not follow the above instructions. Instead, follow the separate instructions provided by your broker, bank or other nominee.
Can I change my vote?
If you are a stockholder of record, you may revoke your proxy or change your vote at any time before it is voted at the Annual Meeting by
submitting a new proxy by telephone or through the internet, after the date of the earlier voted proxy;
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returning a signed proxy card dated later than your last proxy;
If your shares are held in “street name” by your bank, broker or other nominee, you may revoke your proxy or change your vote only by following the separate instructions provided by your bank, broker or nominee.
To vote in person at the Annual Meeting, you must attend the meeting and cast your vote in accordance with the voting provisions established for the Annual Meeting. Attendance at the Annual Meeting without voting in accordance with the voting procedures will not in and of itself revoke a proxy. If your bank, broker or other nominee holds your shares and you want to attend and vote your shares at the Annual Meeting, you must bring a legal proxy signed by your bank, broker or nominee to the Annual Meeting.
What is a “quorum”?
A quorum consists of a majority of the outstanding shares of the Company’s common stock, as of the Record Date, present, or represented by proxy, at the meeting. A quorum is necessary to conduct business at the Annual Meeting. Inspectors of election will determine the presence of a quorum at the Annual Meeting. You are part of the quorum if you have voted by proxy. Abstentions count as shares present at the meeting for purposes of determining a quorum. Shares held by brokers that are not voted on any matter at the Annual Meeting will not be included in determining whether a quorum is present at the meeting.
How are votes counted?
The election of each nominee for director requires the affirmative vote of the holders of a plurality of the shares of common stock voted in the election of directors. Thus, those nominees receiving the greatest number of votes cast will be elected. You may vote “for” or “withhold” for the election of directors. Shares held by brokers that are not voted in the election of directors will have no effect on the election of directors.
The non-binding resolution to endorse the Company’s executive compensation program will be approved if holders of a majority of the shares of common stock present in person or represented by proxy at the Annual Meeting vote in favor of the action.
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Abstentions and broker non-votes will not be considered cast either for or against a matter. A broker non-vote occurs when a broker or other nominee who holds shares for another does not vote on a particular item because the nominee does not have discretionary voting authority for that item and has not received instructions from the owner of the shares.
Will my shares be voted if I do not provide instructions to my broker?
If you are the beneficial owner of shares held in “street name” by a broker, the broker, as the record holder of the shares, is required to vote those shares in accordance with your instructions. If you do not give instructions to the broker, the broker will be entitled to vote the shares with respect to “discretionary” items, but will not be permitted to vote the shares with respect to “non-discretionary” items (those shares are treated as “broker non-votes”).
The election of directors, the approval of a non-binding resolution to endorse the Company’s executive compensation program the approval of the Community Bankers Trust Corporation 2009 Stock Incentive Plan and the ratification of the appointment of Elliott Davis, LLC as the Company’s independent registered public accounting firm for the 20092010 year are all “discretionary” items. The approvalelection of an amendment to the Company’s certificate of incorporation to increase the number of authorized shares of common stockdirectors is a “non-discretionary” item.
Who will count the vote?
The Company has engaged Continental Stock Transfer & Trust Company to serve as the inspector of elections for the Annual Meeting.
What does it mean if I get more than one proxy or voting instruction card?
If your shares are registered in more than one name or in more than one account, you will receive more than one card. Please complete and return all of the proxy or voting instruction cards that you receive (or vote by telephone or through the internet all of the shares on all of the proxy or voting instruction cards received) to ensure that all of your shares are voted.
The Company is soliciting the proxies solicited by this proxy statement and will bear all costs of the solicitation. The Company may solicit proxies by mail, telephone, email, internet, facsimile, press releases and in person. Solicitations may be made by directors, officers and employees of the Company, none of whom will receive additional compensation for such solicitations. The Company will request banks, brokerage houses and other custodians, nominees and fiduciaries to forward all of its solicitation materials to the beneficial owners of the shares that they hold of record. The Company will reimburse these record holders for customary clerical and mailing expenses incurred by them in forwarding these materials to customers.
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Directors and Officers
The following table sets forth information regarding beneficial ownership of the Company’s common stock, as of April 21, 2009,May 1, 2010, for each director, each of the executive officersindividuals named in the Summary Compensation Table in the “Executive Compensation” section below (who are referred to as the named executive officers) and the Company’s current directors and executive officers as a group.
| Total Shares of | ||||||||||||||||
| Shares of | Common Stock | Percent of | ||||||||||||||
| Name | Common Stock (1) | Option Shares (2) | Beneficially Owned | Class | ||||||||||||
NAMED EXECUTIVE OFFICERS | ||||||||||||||||
| George M. Longest, Jr. (3) | 21,398 | 12,195 | 33,593 | * | ||||||||||||
| Gary A. Simanson (3) | 1,651,740 | — | 1,651,740 | 7.6 | ||||||||||||
| Bruce E. Thomas | 4,553 | 4,760 | 9,313 | * | ||||||||||||
| Patrick J. Tewell | 4,954 | 7,100 | 12,054 | * | ||||||||||||
| Bruce B. Nolte (4) | 39,783 | 47,570 | 87,353 | * | ||||||||||||
DIRECTORS | ||||||||||||||||
| Richard F. Bozard | 1,710 | 5,680 | 7,390 | * | ||||||||||||
| L. McCauley Chenault | 13,907 | 2,692 | 16,599 | * | ||||||||||||
| Alexander F. Dillard, Jr. | 133,463 | 2,979 | 136,442 | * | ||||||||||||
| George B. Elliott | 15,511 | 2,692 | 18,203 | * | ||||||||||||
| P. Emerson Hughes, Jr. | 19,132 | 860 | 19,992 | * | ||||||||||||
| Philip T. Minor | 80,498 | 3,437 | 83,935 | * | ||||||||||||
| Troy A. Peery, Jr. | 14,940 | 16,330 | 31,270 | * | ||||||||||||
| Eugene S. Putnam, Jr. (5) | 78,500 | — | 78,500 | * | ||||||||||||
| John C. Watkins | 4,970 | 15,194 | 20,164 | * | ||||||||||||
| Robin Traywick Williams | 5,902 | 10,082 | 15,984 | * | ||||||||||||
| All current directors and executive officers as a group (15 persons) | 2,051,178 | 84,001 | 2,135,179 | 9.9 | ||||||||||||
| Name | Shares of Common Stock (1) | Option Shares (2) | Total Shares of Common Stock Beneficially Owned | Percent Class | ||||||||||||
NAMED EXECUTIVE OFFICERS | ||||||||||||||||
George M. Longest, Jr. (3) | 27,498 | 12,195 | 39,693 | * | ||||||||||||
Bruce E. Thomas | 4,553 | 4,760 | 9,313 | * | ||||||||||||
Gary A. Simanson (3) | 1,100,000 | -- | 1,100,000 | * | ||||||||||||
M. Andrew McLean (4) | 16,977 | 4,402 | 21,379 | * | ||||||||||||
Patrick J. Tewell (4) | 4,954 | 7,100 | 12,054 | * | ||||||||||||
DIRECTORS | ||||||||||||||||
Richard F. Bozard | 4,710 | 5,680 | 10,390 | * | ||||||||||||
L. McCauley Chenault | 13,907 | 2,692 | 16,599 | * | ||||||||||||
Alexander F. Dillard, Jr. | 133,963 | 2,979 | 136,942 | * | ||||||||||||
P. Emerson Hughes, Jr. | 24,582 | 860 | 25,442 | * | ||||||||||||
Philip T. Minor | 81,498 | 3,437 | 84,935 | * | ||||||||||||
Troy A. Peery, Jr. | 14,940 | 16,330 | 31,270 | * | ||||||||||||
Eugene S. Putnam, Jr. | 35,900 | -- | 35,900 | * | ||||||||||||
John C. Watkins | 6,970 | 15,194 | 22,164 | * | ||||||||||||
Robin Traywick Williams | 8,702 | 10,082 | 18,784 | * | ||||||||||||
All current directors and executive officers as a group (16 persons) | 1,484,950 | 79,936 | 1,564,886 | 7.3 | ||||||||||||
| * | Less than one percent of class, based on the total number of shares of common stock outstanding on | |
| (1) | Amounts include shares of common stock that the individual owns directly or indirectly through affiliated corporations, close relatives, and dependent children or as custodians or trustees. | |
| (2) | Amounts reflect shares of common stock that could be acquired through the exercise of stock options within 60 days after | |
| (3) | Messrs. Longest and Simanson are also | |
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| Shares of Common Stock | ||||||||
| Beneficially Owned | ||||||||
| Name and Address | Number | �� | Percent of Class | |||||
| Wellington Management Company, LLP (1) | 1,730,196 | 8.1 | ||||||
| Wolf Creek Investors (Bermuda) L.P. Wellington Global Holdings, Ltd. Wolf Creek Partners, L.P. Wellington Hedge Management, LLC 75 State Street Boston, Massachusetts 02109 | ||||||||
| B&W Equities, LLC (2) | 1,717,884 | 8.0 | ||||||
| 4424 16th Avenue Brooklyn, New York 11204 | ||||||||
| Community Bankers Acquisition LLC (3) | 1,651,740 | 7.6 | ||||||
| Gary A. Simanson 9912 Georgetown Pike, Suite D203 Great Falls, Virginia 22066 | ||||||||
| Weiss Multi-Strategy Advisers LLC (4) | 1,250,000 | 5.8 | ||||||
| George A. Weiss Frederick E. Doucette III One State Street, 20th Floor Hartford, Connecticut 06103 | ||||||||
| Morgan Stanley (5) | 1,200,000 | 5.6 | ||||||
| 1585 Broadway New York, New York 10036 | ||||||||
| FrontPoint Partners LLC Two Greenwich Plaza Greenwich, Connecticut 06830 | ||||||||
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| (4) | Messrs. McLean and Tewell were executive officers until April 2010. |
Principal Stockholders
The following table contains information regarding the persons or groups that the Company knows to beneficially own more than five percent of the Company’s common stock as of May 1, 2010.
| Name and Address | Shares of Common Stock Beneficially Owned | |||||
| Number | Percent of Class | |||||
Morgan Stanley (1) 1585 Broadway New York, New York 10036 FrontPoint Partners LLC Two Greenwich Plaza Greenwich, Connecticut 06830 | 2,025,000 | 9.4 | ||||
Wellington Management Company, LLP (2) 75 State Street Boston, Massachusetts 02109 | 1,805,196 | 8.4 | ||||
Weiss Multi-Strategy Advisers LLC (3) George A. Weiss Frederick E. Doucette III One State Street, 20th Floor Hartford, Connecticut 06103 | 1,740,800 | 8.1 | ||||
| (1) | Based on information set forth in a Schedule 13G filed with the Securities and Exchange Commission on February | |
| (2) | Based on information set forth in a Schedule 13G filed with the Securities and Exchange Commission on February 12, 2010. The Schedule 13G reports that, as of December 31, 2009, Wellington Management Company, LLP, in its capacity as an investment adviser, has shared voting power and dispositive power with respect to 1,805,196 shares of common stock. |
| (3) | Based on information set forth in a Schedule 13G filed with the Securities and Exchange Commission on February 12, 2010. The Schedule 13G reports that, as of December 31, 2009, each of Weiss Multi-Strategy Advisers LLC, in its capacity as an investment adviser, George A. Weiss and Frederick E. Doucette III has shared voting power with respect to 1,646,100 shares of common stock and shared dispositive power with respect to 1,740,800 shares of common stock. |
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s executive officers, directors and persons who own more than 10% of its common stock to file reports of ownership and changes in ownership on Forms 3, 4 and 5 with the Securities and Exchange Commission. Executive officers, directors and greater-than-10% stockholders are required by regulation to furnish the Company with copies of all Forms 3, 4 and 5 that they file.
Based on the Company’s review of the copies of those forms, and any amendments that it has received, and written representations from its executive officers and directors, the Company believes that all executive officers, directors and beneficial owners of more than 10% of its common stock complied with all of the filing requirements applicable to them with respect to transactions during the year ended December 31, 2008,2009, except that Troy A. Peery, Jr.M. Andrew McLean inadvertently filed late a Form 43 with respect to the purchase of shares of commonhis stock ownership in June 2008 and P. Emerson Hughes, Jr. inadvertently filed late a Form 4 with respect to the purchase of shares of common stock in August 2008.
7May 2009.
THE BOARD OF DIRECTORS
General
The business and affairs of the Company are managed under the direction of the Board of Directors in accordance with Delaware General Corporation Law and the Company’s Certificate of Incorporation and Bylaws, as amended. Members of the Board are kept informed of the Company’s business through discussions with the President and Chief Executive Officer and other officers, by reviewing materials provided to them and by participating in meetings of the Board of Directors and its committees.
Director Independence
The Company’s Board of Directors has determined that 109 of its 1211 members are independent as defined by the listing standards of NYSE Amex, including the following: Richard F. Bozard, L. McCauley Chenault, Alexander F. Dillard, Jr., George B. Elliott, P. Emerson Hughes, Jr., Philip T. Minor, Troy A. Peery, Jr., Eugene S. Putnam, Jr., John C. Watkins and Robin Traywick Williams. In reaching this conclusion, the Board of Directors considered that the Company and its subsidiaries conduct business with companies of which certain members of the Board of Directors or members of their immediate families are or were directors or officers.
In making this independence determination, the Board of Directors considered certain relationships between the Company and certain of its directors, such as the provision of legal services by law firms with which Messrs. Chenault and Dillard are affiliated, to determine whether such director was independent under NYSE Amex’s listing standards. See the “Certain Relationships and Related Transactions” section belowon page 33 for additional information on certain transactions with members of the Company’s Board of Directors.
George B. Elliott, who also served as a director during partall of 2008,2009, was also determined to be independent during 2008.
Leadership Structure and Risk Oversight
To date, the Company has chosen not to combine the positions of the Chairman of the Board of Directors and the Chief Executive Officer. The Company believes that its leadership structure is appropriate because, by having an outside independent Chairman, there exists a certain degree of control and balanced oversight of the management of the Board’s functions and its decision-making processes, including those processes relating to the maintenance of effective risk management programs. The Chief Executive Officer makes monthly reports to the Board, often at the suggestion of the Chairman of the Board or other directors, and he explains in detail to the Board the reasons for certain recommendations of the Company’s management.
The Board of Directors is responsible for setting an appropriate culture of compliance within the organization, for establishing clear policies regarding the management of key risks and for ensuring that these policies are adhered to in practice. The risks that are an inherent part of the Company’s business and operations are credit risk, market risk, operational risk, liquidity risk, fiduciary risk and legal and
reputational risk. The Board must have an appropriate understanding of the types of risks to which the organization is exposed, and the Board must ensure that the organization’s management is fully capable, qualified and properly motivated to manage the risks arising for the organization’s business activities in a manner that is consistent with the Board’s expectations. Likewise, management is responsible for communicating and reinforcing the compliance culture that the Board has established and for implementing measures to promote the culture throughout the organization.
The Audit Committee of the Board of Directors is responsible for overseeing the Company’s risk management function on behalf of the Board. In carrying out this responsibility, the Audit Committee works closely with the Company’s Chief Risk Officer and Chief Internal Auditor and other members of the Company’s risk management team. The Audit Committee meets regularly with these individuals and receives an overview of findings from various risk management initiatives, including internal audits, Sarbanes-Oxley reports and other regulatory compliance reports. The Company’s Chief Internal Auditor, in particular, provides a comprehensive report to the Audit Committee regarding the Company’s key risks. While the Audit Committee has primary responsibility for overseeing risk management, the entire Board of Directors is actively involved in overseeing this function for the Company as, on a monthly basis, the Board receives a report from the Audit Committee’s chairman and discusses the risks that the Company is facing. These risks are also discussed with members of management.
Other committees of the Board of Directors consider the risks within their areas of responsibility. For example, the Compensation Committee considers the risks that may be inherent in the Company’s executive compensation programs. For additional information regarding the Compensation Committee, see “Executive Compensation” beginning on page 18 of this proxy statement.
During 2009, the Board of Directors developed a plan to establish and maintain effective risk management programs to address oversight, control and supervision of the Bank’s management, major operations and activities. The Company recognizes that, with the size, geographic locations and financial diversity resulting from the organization’s rapid growth and business strategies, greater emphasis must and will be directed toward implementing cost-effective improvements to its risk management systems and to the other areas where improvements are needed. The Board of Directors and the management team are committed to improving and strengthening the Company’s governance controls and risk management practices. As noted above, the Board of Directors and its committees regularly review and discuss risk management issues with management at each of their meetings.
Code of Ethics
The Company’s Board of Directors has approved a Code of Conduct and Ethics for directors, officers and all employees of the Company and its subsidiaries, including the Company’s principal executive officer, principal financial officer and principal accounting officer. A copy of the Code of Conduct and Ethics is available on the “investor information” page of the Company’s internet web site atwww.cbtrustcorp.com.
Board and Committee Meeting Attendance
There were 1512 meetings of the Board of Directors in 2008.2009. Each director attended at least 75% of the aggregate number of meetings of the Board of Directors and meetings of committees of which the director was a member in 2008.
Independent Directors Meeting
Non-employee directors meet periodically outside of regularly scheduled Board meetings.
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The Board of Directors has standing audit, nominating and compensation committees.
Audit Committee
The Audit Committee assists the Board in the fulfillment of its oversight responsibilities with respect to the completeness and accuracy of the Company’s financial reporting and the adequacy of its financial and operating controls. The primary purpose of the Audit Committee is to provide independent and objective oversight with respect to the integrity of the Company’s financial statements, and reports and any additional financial information provided to stockholders and others, the Company’s internal controls, the independent auditor’s qualifications and independence, the performance of the Company’s internal audit accountingfunction and independent auditors, the effectiveness of the Company’s internal control over financial reporting processes generally and compliance by the Company with legal and regulatory requirements. The Audit Committee also provides oversight of the Company’s enterprise-wide risk management program and activities and reviews the effectiveness of the Company’s process for managing and assessing risk. A copy of the Audit Committee’s charter is available on the “investor information” page of the Company’s internet web site atwww.cbtrustcorp.com.
The current members of the Audit Committee are Troy A. Peery, Jr. (Chair), George B. Elliott, Philip T. Minor, Eugene S. Putnam, Jr., and Robin Traywick Williams. The Company’s Board of Directors has determined that Mr. Peery qualifies as an audit committee financial expert, as defined by the rules and regulations of the Securities and Exchange Commission, and that each member of the Audit Committee is independent, as independence for audit committee members is defined by NYSE Amex’s listing standards.
The Audit Committee met nine10 times in 2008.2009. For additional information regarding the Audit Committee, see “Report of the Audit Committee” beginning on page 3536 of this Proxy Statement.
Compensation Committee
The Compensation Committee assists the Board in the fulfillment of its oversight responsibilities with respect to the Company’s executive compensation. The primary purpose of the Compensation Committee is to ensure that the compensation and benefits for senior management and the Board of Directors is fair and appropriate, is aligned with the interests of the Company’s stockholders and does not pose a risk to the financial health of the Company or its affiliates. A copy of the Compensation Committee’s charter is available on the “investor information” page of the Company’s internet web site atwww.cbtrustcorp.com.
The current members of the Compensation Committee are Eugene S. Putnam, Jr. (Chair), L. McCauley Chenault, Philip T. Minor, Troy A. Peery, Jr., and John C. Watkins. The Company’s Board of Directors has determined that each member of the Compensation Committee is independent, as defined by NYSE Amex’s listing standards. The Compensation Committee met sevenfive times in 2008.
The Company’s compensation program consists generally of salary, bonus and benefits. The Compensation Committee is responsible for the review and approval of the Company’s compensation plans, compensation for senior management, salary and bonus ranges for other employees and all employment, severance and change in control agreements. The Compensation Committee also reviews
and approves compensation for the directors of the Company and its subsidiaries.banking subsidiary. The Compensation Committee recommends that its determinations be ratified by the independent members of the Company’s Board of Directors. The Compensation Committee has not delegated any of its authority to other persons.
In making its determinations with respect to compensation, the Compensation Committee has relied on recommendations from the Company’s President and Chief Executive Officer with respect to the salaries of the Company’s senior management and bonus levels for all employees. The Compensation
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In 2009, the Compensation Committee engaged the Consulting Services Division of Silverton Bank and David W. Jones, a principal in that division, to advise it on a proposed new stock incentive plan, a proposed new form of employment agreementprovide compensation consulting services to the Company. Mr. Jones made reports directly to the Compensation Committee and a new compensation philosophymet with its members when the Company’s management was not present. Mr. Jones is now affiliated with Matthews Young – Management Consulting, and the Compensation Committee has engaged Matthews Young as its consultant for evaluating management incentive compensation for 2009. This engagement resulted inthe year ended December 31, 2010.
During 2009, the Compensation Committee’s approvalcompensation consultant and affiliates provided only the compensation advisory services to the Company described below:
Provided an overview of guidelines and regulations related to officer compensation under the United States Department of Treasury’s Troubled Asset Relief Program.
Assisted in the design of a long-term incentive plan, including equity-based compensation, which was presented to and approved by the Company’s stockholders at the 2009 annual meeting.
Reviewed and briefed the Compensation Committee on existing employment and change-of-control agreements for officers of the Company’s 2009 Stock Incentive Plan, which is being presentedCompany, and provided information on prevailing market practices with respect to stockholdersthe use and terms of employment and change-of-control agreements.
Outlined elements for their approval atdeveloping an executive compensation philosophy and strategy for the Annual Meeting. See “Proposal Four — Community Bankers Trust Corporation 2009 Stock Incentive Plan” below.Company.
Provided information on prevailing market practices in the use and design of performance-based compensation for senior officers.
For additional information regarding the Compensation Committee, see “Executive Compensation” beginning on page 18 of this proxy statement.
Nominating and Governance Committee
The Nominating and Governance Committee (the “Nominating Committee”) assists the Board in the fulfillment of its oversight responsibilities with respect to the Company’s corporate governance. The Committee is responsible primarily for making recommendations to the Board of Directors regarding the membership of the Board, including recommending to the Board the slate of director nominees for election at each annual meeting of stockholders, considering, recommending and recruiting candidates to fill any vacancies or new positions on the Board, including candidates that may be recommended by stockholders, establishing criteria for selecting new directors and reviewing the backgrounds and qualifications of possible candidates for director positions. A copy of the Nominating Committee’s charter is available on the “investor information” page of the Company’s internet web site atwww.cbtrustcorp.com.
The current members of the Nominating Committee are P. Emerson Hughes, Jr. (Chair), Richard F. Bozard, Eugene S. Putnam, Jr., and Robin Traywick Williams. The Company’s Board of Directors has determined that each member of the Nominating Committee is independent, as defined by NYSE Amex’s listing standards. The Nominating Committee did not meetmet five times in 2008.
In identifying potential nominees for service as a director, the Nominating Committee takes into account such factors as it deems appropriate, including the current composition of the Board, to ensure diversity among its members. Diversity includes the range of talents, experiences and skills that would best complement those that are already represented on the Board, the balance of management and independent directors and the need for specialized expertise. Diversity also includes education, race, gender and the geographic areas where the individual has either resided, worked or served. The Nominating Committee considers candidates for Board membership suggested by Board members and by management, and it will also consider candidates suggested informally by a stockholder of the Company.
The Nominating Committee considers, at a minimum, the following factors in recommending to the Board of Directors potential new directors, or the continued service of existing directors:
financial, regulatory and business experience;
familiarity with and participation in the local community;
integrity, honesty and reputation;
dedication to the Company and its stockholders;
independence; and
any other factors that the Nominating Committee deems relevant, including age, size of the Board of Directors and regulatory disclosure obligations.
The Nominating Committee may weight the foregoing criteria differently in different situations, depending on the composition of the Board of Directors at the time. In addition, prior to nominating an existing director for re-election to the Board of Directors, the Nominating Committee will consider and
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Stockholders entitled to vote for the election of directors may submit candidates for formal consideration by the Nominating Committee in connection with an annual meeting if the Company receives timely written notice, in proper form, for each such recommended director nominee. If the notice is not timely and in proper form, the nominee will not be considered by the Company. To be timely for the 20102011 annual meeting, the notice must be received within the time frame set forth in the “Stockholder Proposals” section below. To be in proper form, the notice must include each nominee’s written consent to be named as a nominee and to serve, if elected, and information about the stockholder making the nomination and the person nominated for election. These requirements are more fully described in Section 3.4 of the Company’s Bylaws, a copy of which will be provided, without charge, to any stockholder upon written request to the Secretary of the Company, whose address is Community Bankers Trust Corporation, 4235 Innslake Drive, Suite 200, Glen Allen, Virginia 23060.
Compensation Committee Interlocks and Insider Participation
No member of Directors nominated and appointed John C. Watkins, whothe Compensation Committee is standing for election as a director atcurrent or former officer or employee of the Annual Meeting,Company or any of its subsidiaries. In addition, there are no compensation committee interlocks with other entities with respect to the Board in July 2008.
Annual Meeting Attendance
The Company encourages members of the Board of Directors to attend each annual meeting of stockholders. All of the directors attended the 20082009 annual meeting. Meetings of the Board and its committees are held in conjunction with the annual meeting of stockholders, and all directors and nominees are expected to attend the annual meeting of stockholders.
Communications with Directors
Any director may be contacted by writing to him or her in care of Community Bankers Trust Corporation, 4235 Innslake Drive, Glen Allen, Virginia 23060. Communications to the non-management directors as a group may be sent to the same address, c/o the Secretary of the Company. The Company promptly forwards, without screening, all such correspondence to the indicated directors.
Director Compensation
The Company compensates its non-employee directors as follows:
Monthly retainer of $1,000 per month
Additional retainer for the Chairman of the Board of $2,500 per quarter
Additional retainer for each chairman of a Board committee of $1,250 per quarter
Board meeting fees for the Chairman of the Board of $1,000 per meeting
Board meeting fees for other non-employee directors of $500 per meeting
Committee meeting fees of $300 or $450 per meeting, depending on the committee
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| Nonqualified | ||||||||||||
| Deferred | ||||||||||||
| Fees Earned or | Compensation | |||||||||||
| Paid in Cash | Earnings | Total | ||||||||||
| Name | ($) (3) | (4) | ($) | |||||||||
| Chris A. Bagley (1) | 0 | — | 0 | |||||||||
| Richard F. Bozard (2) | 14,500 | — | 14,500 | |||||||||
| L. McCauley Chenault (2) | 15,650 | — | 15,650 | |||||||||
| Alexander F. Dillard, Jr. (2) | 15,400 | 8,333 | 23,733 | |||||||||
| George B. Elliott (2) | 12,975 | 3,350 | 16,325 | |||||||||
| P. Emerson Hughes, Jr. (2) | 15,000 | 1,000 | 16,000 | |||||||||
| Christopher G. Miller (2) | 20,675 | — | 20,675 | |||||||||
| Philip T. Minor (2) | 19,225 | — | 19,225 | |||||||||
| Troy A. Peery, Jr. (2) | 21,716 | — | 21,716 | |||||||||
| Eugene S. Putnam, Jr. | 20,666 | — | 20,666 | |||||||||
| Keith Walz (1) | 0 | — | 0 | |||||||||
| John C. Watkins (2) | 14,500 | — | 14,500 | |||||||||
| Robin Traywick Williams (2) | 17,050 | — | 17,050 | |||||||||
| Jack C. Zoeller (2) | 21,316 | — | 21,316 | |||||||||
Name
| Fees Earned or ($) (2) | Nonqualified (3) | Total ($) | |||||||||||
Richard F. Bozard | 27,450 | -- | 27,450 | |||||||||||
L. McCauley Chenault | 25,125 | 3,534 | 28,659 | |||||||||||
Alexander F. Dillard, Jr. | 39,250 | 7,635 | 46,885 | |||||||||||
George B. Elliott (1) | 25,275 | 2,663 | 27,938 | |||||||||||
P. Emerson Hughes, Jr. | 27,150 | 4,647 | 31,797 | |||||||||||
Philip T. Minor | 31,650 | 2,663 | 34,313 | |||||||||||
Troy A. Peery, Jr. | 37,325 | -- | 37,325 | |||||||||||
Eugene S. Putnam, Jr. | 29,900 | -- | 29,900 | |||||||||||
John C. Watkins | 25,425 | -- | 25,425 | |||||||||||
Robin Traywick Williams | 26,625 | -- | 26,625 |
| (1) |
| (2) | ||
| Amounts represent the monthly and additional quarterly retainers, board meeting fees and committee meeting fees. |
| (3) | Amounts relate to participation of directors that served as directors of BOE Financial Services of Virginia, Inc., which the Company acquired on May 31, 2008 (“BOE Financial”), prior to its merger with the Company in the Directors’ Supplemental Retirement Plan and reflect changes in the value of each director’s interest in the plan during |
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ELECTION OF DIRECTORS
General
The Company’s Board of Directors currently consists of 1211 directors and is divided into three classes with staggered terms. The four directors in Class I are serving for a term that expires at the Annual Meeting, the fourthree directors in Class II are serving for a term that expires at the 2010 annual meeting of stockholders andAnnual Meeting, the four directors in Class III are serving for a term that expires at the 2011 annual meeting of stockholders and the four directors in Class I are serving for a term that expires at the 2012 annual meeting of stockholders.
The Board, upon the recommendation of the Nominating Committee, has nominated P. Emerson Hughes,L. McCauley Chenault, Troy A. Peery, Jr., George M. Longest, and Eugene S. Putnam, Jr., John C. Watkins and Robin Traywick Williams, for election to the Board at the Annual Meeting. All of the nominees presently serve as directors, and their terms will expire at the Annual Meeting. The Company is asking stockholders to re-elect each of them for a three-year term.
The Board of Directors recommends that the stockholders voteFORthe election of Messrs. Hughes, LongestChenault, Peery and Watkins and Mrs. Williams.Putnam. If you sign and return your proxy card in the enclosed envelope or execute a proxy by telephone or bythrough the internet, the persons named in the enclosed proxy card will vote to elect these fourthree nominees unless you indicate otherwise. Your proxy for the Annual Meeting cannot be voted for more than fourthree nominees.
All of the Company’s nominees have indicated their willingness to serve if elected. If any nominee of the Company is unable or unwilling to serve as a director at the time of the Annual Meeting, then shares represented by properly executed proxies will be voted at the discretion of the persons named in those proxies for such other person as the Board may designate. The Company does not presently expect that any of the nominees will be unavailable.
The election of each nominee for director requires the affirmative vote of the holders of a plurality of the shares of common stock voted in the election of directors. Thus, those nominees receiving the greatest number of votes cast will be elected.
The following information sets forth the business experience and other information for all directors for the past five years.directors. Such information includes each director’s service on the boards of TransCommunity Financial Corporation, which the Company acquired on May 31, 2008 (“TransCommunity Financial”), and BOE
Financial, as the case may be, each of which merged with and into the Company on May 31, 2008.be. References to a director’s service on the board of BOE Financial include service on the board of its predecessor, Essex Bank of Essex (which is now a wholly owned subsidiary of the Company) (the “Bank”).
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P. Emerson Hughes, Jr.L. McCauley Chenault, 65,58, has been a director of the Company since 2008. He had previously served as a director of BOE Financial since 1987. Mr. Chenault is the managing attorney of Chenault Law Offices, PLC in Mechanicsville, Virginia, a position that he has held for more than five years.
In addition to his long service as a director, Mr. Chenault brings extensive experience in legal matters that affect the Bank and its customers, including credit and real estate issues, which experience provides the Board with a substantial resource. He also has significant community ties to the Bank’s central Virginia market areas.
Troy A. Peery, Jr., 64, has been Vice Chairman of the Company’s Board of Directors since 2008. He had previously served as a director of TransCommunity Financial since 2002. Mr. Peery has been President of Peery Enterprises, a real estate development company based in Manakin-Sabot, Virginia, since 1998. He retired as President and Chief Operating Officer in 1998, and director in 1999, of Heilig-Meyers Company, a national furniture retailer that filed for bankruptcy protection in August 2000.
Mr. Peery brings significant operational, financial management and governance experience, including his service in executive management and as a director for Heilig-Meyers and Open Plan Systems, Inc., both of which were public companies. He also has significant community ties to the Bank’s central Virginia market areas.
Eugene S. Putnam, Jr., 50, has been a director of the Company since 2005 and served as its Chairman of the Board from 2005 to 2008. Mr. Putnam has been Executive Vice President and Chief Financial Officer for Universal Technical Institute, Inc., a post-secondary education provider, since 2008, and he served as its interim Chief Financial Officer from January 2008 to July 2008. From 2005 to May 2007, he was Executive Vice President and Chief Financial Officer of Aegis Mortgage Corporation, a mortgage origination and servicing company that filed for bankruptcy protection in August 2007. From 2003 to 2005, he was President of Coastal Securities LP, a registered broker-dealer.
Mr. Putnam brings high level financial expertise as chief financial officer of publicly traded companies and experience in risk management and strategic planning. He also has banking expertise in corporate finance, capital planning and balance sheet management. His background helps him play critical roles on the Board’s committees.
Directors Whose Terms Do Not Expire This Year (Class I and Class III Directors)
Richard F. Bozard, 63, has been a director of the Company since 2008. He had previously served as a director of TransCommunity Financial since 2006. Mr. Bozard was Vice President and Treasurer of Owens & Minor, Inc., a medical and surgical supplies distributor based in Mechanicsville, Virginia, from 1991 until his retirement in 2009. He had also been Senior Vice President and Treasurer of Owens & Minor Medical, Inc., a subsidiary of Owens & Minor, Inc., from 2004 until his retirement.
Mr. Bozard brings broad experience in the areas of management and oversight of public companies. He also has significant experience in asset and liability management, finance and strategic planning, which provides both the Board and management with a substantial resource, and thus he serves as Chair of the Board’s Asset and Liability Committee.
Alexander F. Dillard, Jr., 71, has been Chairman of the Company’s Board of Directors since 2008. He had previously served as a director of BOE Financial since 1982. Mr. Dillard is a senior partner in the law firm of Dillard & Katona in Tappahannock, Virginia, a position that he has held for more than five years.
In addition to his long service as a director, Mr. Dillard brings extensive experience in governance and legal matters that affect the Bank and its customers, including credit and real estate issues, which experience provides the Board with a substantial resource. He also has significant community ties to the Bank’s eastern Virginia market areas.
P. Emerson Hughes, Jr., 66, has been a director of the Company since 2008. He had previously served as a director of BOE Financial since 2004. Mr. Hughes is President and operator of Holiday Barn, Ltd., a pet boarding and day care facility based in Glen Allen, Virginia, where he has been employed since 1972.
Mr. Hughes brings long-term corporate management experience as a small business owner, including his knowledge of commercial business needs in the Bank’s central Virginia market areas. He also has significant community ties to those areas.
George M. Longest, Jr., 48,49, has been a director of the Company since May 2008. He had previously served as a director of BOE Financial since 1999. Mr. Longest has been the Company’s President since May 2008, the Company’sand Chief Executive Officer since July 2008, the Bank’s President since May 2010 and the Bank’s Chief Executive Officer since 1999. From 1999 to May 2008, Mr. Longest was also President and Chief Executive Officer of BOE Financial and President of the Bank.
Mr. Longest brings his experience as a career banker with the Bank, and he has broad expertise with all of the major areas of the Bank’s operations. He also has significant community ties to the Bank’s eastern Virginia market areas.
John C. WatkinsPhilip T. Minor, 62,75, has been a director of the Company since July2008. He had previously served as a director of BOE Financial since 1974. Mr. Minor is a partner in Philip Minor Farms in St. Stephens Church, Virginia, a position that he has held for more than five years.
In addition to his long service as a director, Mr. Minor brings significant experience as a small business owner, including his knowledge of real estate business needs in the Bank’s eastern Virginia market areas. He also has significant community ties to those areas.
Gary A. Simanson, 49, has been a director of the Company since 2005. Mr. Simanson served as the Company’s Chief Strategic Officer from 2008 to April 2010. From 2005 to 2008, he was the Company’s President, Chief Executive Officer and Chief Financial Officer. Mr. Simanson has also been managing director of First Capital Group, L.L.C., an investment banking advisor firm specializing in bank mergers and acquisitions, since 1997.
The founder of the Company, Mr. Simanson brings governance and operational experience and expertise in investment banking matters. He has substantial knowledge in bank mergers and acquisitions and provides the Company with a significant resource for strategic planning.
John C. Watkins, 63, has been a director of the Company since 2008. He had previously served as a director of TransCommunity Financial and its predecessor, Bank of Powhatan, N.A., since 1998. Senator Watkins was President of Watkins Nurseries, Inc., a landscape design firm and wholesale plant material grower based in Midlothian, Virginia, from 1998 to 2008, and he currently serves as the Chairman of its board of directors. He has also been Manager and Development Director for Watkins Land, LLC, a real estate company based in Midlothian, Virginia, since 1999. He was a member of the Virginia House of Delegates from 1982 to 1998 and has been a member of the Senate of Virginia since 1998.
Senator Watkins brings long-term corporate management experience as a small business owner and entrepreneur, through his ownership and operation of successful businesses in the Company’s market areas. He also brings substantial government and public policy expertise and leadership knowledge to the Company due to his long service in the Virginia state government. He has significant community ties to the Bank’s Virginia market areas.
Robin Traywick Williams, 58,59, has been a director of the Company since May 2008. She had previously served as a director of TransCommunity Financial since 2002. Mrs. Williams is a writer and serves on the boardsas president of the Virginia Foundation for the Humanities and the Thoroughbred Retirement Foundation. From 1998 to 2003, she served as Chairman of the Virginia Racing Commission in Richmond, Virginia.
Mrs. Williams brings regulatory and Class III Directors)
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15
The Company’s executive officers as of May 1, 2010 and their respective ages and positions are set forth in the following table.
Name | Age | Position | ||||||
| George M. Longest, Jr. | President and Chief Executive Officer, | |||||||
| Bruce E. Thomas | Senior Vice President and Chief Financial | |||||||
| Rex L. Smith, III | 52 | Executive Vice President and Chief Banking | ||||||
| William E. Saunders, Jr. | ||||||||
Executive Vice President and Chief Operating | ||||||||
| Douglas D. Wall | ||||||||
| 50 | ||||||||
Senior Vice President and Chief | ||||||||
| John M. Oakey, III | 42 | General Counsel and Secretary, Community | ||||||
The following information sets forth the business experience and other information for the executive officers for the past five years.officers. Such information with respect to Messrs.Mr. Longest and Simanson is set forth above in the “Proposal One —– Election of Directors” section.
Mr. Thomas has been Senior Vice President and Chief Financial Officer of the Company since May 2008. From 2000 to May 2008, he was Senior Vice President and Chief Financial Officer of BOE Financial. He has been employed in various positions with the Bank since 1990 and is currently also the Bank’s Senior Vice President and Chief Financial Officer.
Mr. McLeanSmith has been Executive Vice President and Chief Banking Officer of theEssex Bank since July 2008, when TransCommunity Bank, N.A.,May 2010. From April 2009 to April 2010, he served as the former subsidiary of TransCommunity Financial, merged into the Bank.Bank’s Executive Vice President and Chief Administrative Officer. From 2007 to July 2008,2009, he was the Central Virginia President for Gateway Bank and Chief Executive Officer of TransCommunity Bank. From 2001Trust and, from 2000 to 2007, he was President and Chief Executive Officer of The Bank of Goochland, N.A., also a former subsidiaryRichmond.
Mr. Saunders has been Executive Vice President and Chief Operating Officer of TransCommunity Financial priorEssex Bank since May 2010. From 2008 to its consolidation into TransCommunity Bank.
Mr. TewellWall has been Senior Vice President and Chief AccountingCredit Officer of Essex Bank since March 2010. In 2009, he was Executive Vice President and Chief Credit Officer at Bank of Hampton Roads. From 2001 to 2008, he held numerous positions with Capital One Bank, including Senior Vice President – Commercial Credit Portfolio Analysis and Reporting, Fair Lending and Mortgage Compliance Officer, Bank Consumer and M&A Credit Officer and Credit Policy Manager.
Mr. Oakey has been General Counsel and Secretary of the Company and the Bank since March 2009, with the titles of General Counsel since May 2008.2010 and Senior Legal Counsel from March 2009 to April 2010. From 2007 to 2008,March 2009, he was Chief Financial Officer of TransCommunity Financial. From 2004 toDirector and Assistant General Counsel for Circuit City Stores, Inc. Until 2007, he was Senior Financial/IT Auditora partner at the law firm of Williams Mullen, where he began practicing in 1995.
Compensation Committee Report
The Compensation Committee of the Board of Directors reviews and establishes the compensation program for the Company’s senior officers, including the named executive officers in the Summary Compensation Table below, and provides oversight of the Company’s compensation program. A discussion of the principles, objectives, components, analyses and determinations of the Committee with respect to executive compensation is included in the Compensation Discussion and Analysis that follows this Committee report. The Compensation Discussion and Analysis also includes discussion with respect to the Committee’s review of officer and employee compensation plans and specifically any features that may encourage employees to take unnecessary and excessive risks. The specific decisions of the Committee regarding the compensation of the named executive officers are reflected in the compensation tables and narrative that follow the Compensation Discussion and Analysis.
The Compensation Committee certifies that:
(1) it reviewed with the senior risk officer the senior executive officer compensation plans and made all reasonable efforts to ensure that these plans do not encourage the senior executive officers to take unnecessary and excessive risks that threaten the value of the Company;
(2) it reviewed with the senior risk officer the employee compensation plans and made all reasonable efforts to limit any unnecessary risks these plans pose to the Company; and
(3) it reviewed the employee compensation plans to eliminate any features of these plans that would encourage the manipulation of reported earnings of the Company and the Bank to enhance the compensation of any employee.
The Committee has reviewed the Compensation Discussion and Analysis and discussed it with the Company’s management. Based on this review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Company’s annual report on Form 10-K for the year ended December 31, 2009 and 2010 proxy statement.
Compensation Committee
Eugene S. Putnam, Jr., Chair
L. McCauley Chenault
Philip T. Minor
Troy A. Peery, Jr.
John C. Watkins
Date: April 30, 2010
Compensation Discussion and Analysis
General
The Compensation Committee of the Company’s Board of Directors reviews and establishes the compensation program for the Company’s senior officers, including the named executive officers in the Summary Compensation Table below, and provides oversight of the Company’s compensation program. The Committee consists entirely of non-employee, independent members of the Board and operates under a written charter approved by the Board.
The Committee specifically discharges Board oversight responsibilities with respect to:
the compensation of the Company’s Chief Executive Officer and other executive officers and other key employees;
the administration of incentive compensation plans, including stock plans and short- and long-term incentive compensation plans; and
the approval, review and oversight of certain other benefit plans of the Company.
The Company’s compensation program generally consists of salary, bonus, and benefits. Benefits include a defined benefit pension plan, a supplemental retirement plan, participation in the Company’s 401(k) plan and health insurance benefits. In addition, the Company offers perquisites to certain executive officers such as use of Company-owned vehicles. The Company recognizes that competitive compensation is critical for attracting, motivating, and rewarding qualified executives. One of the fundamental objectives of the Company’s compensation program is to offer competitive compensation and benefits for all employees, including executive officers, in order to compete for and retain talented personnel who will lead the Company in achieving levels of financial performance that enhance stockholder value.
Over the past two years, the Company has grown significantly through mergers with TransCommunity Financial and BOE Financial and acquisitions of the operations of The Community Bank in Georgia and Suburban Federal Savings Bank in Maryland. This growth has strained the Company’s organizational structure and the effectiveness of risk management programs that are appropriate for the various functions of an organization of its size and complexity. As a result, the Company requires a strong management team to identify and address these issues and believes that a primary focus of the Company’s compensation program should be to attract and retain a team of experienced bankers.
For the year ended December 31, 2009, the Committee engaged the Consulting Services Division of Silverton Bank and David W. Jones, a principal in that division, as independent consultants to assist it in carrying out certain responsibilities with respect to executive compensation. Mr. Jones is now affiliated with Matthews Young – Management Consulting, and the Committee has engaged Matthews Young as its consultant for the year ended December 31, 2010.
The following discussion explains the material elements of compensation paid to the Company’s named executive officers and provides the material factors underlying its compensation policies and practices. The information in this discussion specifically provides context for the compensation disclosures in the tables that follow it and should be read along with those disclosures.
American Recovery and Reinvestment Act of 2009
On December 19, 2008, the Company entered into a letter agreement with the United States Department of the Treasury (“Treasury”) under which it issued 17,680 shares of its Series A preferred stock in connection with the Capital Purchase Program under the Treasury’s Troubled Asset Relief Program (“TARP”). In accordance with the terms of the letter agreement, the Company and the named executive officers amended certain employment agreements and benefit plans and arrangements to the extent necessary to be in compliance with the executive compensation and corporate governance requirements of Section 111(b) of the Emergency Economic Stabilization Act of 2008 (“EESA”) as implemented by any guidance or regulation under Section 111(b) of EESA that was issued and in effect as of the closing date of the transaction. Section 7001 of the American Recovery and Reinvestment Act of 2009 (“ARRA”) amends Section 111 of EESA to provide that TARP participants are subject to the “standards established by the Secretary” and directs the Secretary of Treasury to “require each TARP recipient to meet appropriate standards for executive compensation and corporate governance.”
Under regulations that have been issued pursuant to EESA, the Committee has reviewed all components of the Company’s compensation program, as described below, with respect to the Company’s senior executive officers, which include the named executive officers. These components essentially consist of employment agreements, bonus arrangements and a new stock incentive plan. None of these plans presently contain any feature that, in the Committee’s review, would encourage the senior executive officers to take unnecessary and excessive risks to threaten the value of the Company.
In addition, in conjunction with a review with the Company’s Chief Risk Officer, the Committee reviewed employee compensation plans generally. Most of the Company’s employees are compensated by the payment of salary, and historically certain employees would be awarded a performance bonus if, in the estimation of their managers, their performance merited such an award. The Committee determined that there is no element in any senior executive officer plan or any employee plan that would encourage the executives or employees to manipulate reported earnings in order to enhance compensation.
Compensation Program
The elements of the Company’s compensation program represent the elements that the Company has offered in the past in order to attract, motivate, reward and retain highly qualified executive officers. The Company believes that these elements are also standard compensation components of its peer companies and allow the Company to present an attractive compensation package to each of its named executive officers in comparison with these companies.
The Committee approves the compensation of all members of senior management, including the named executive officers.
Salary
The base salary of the named executive officers is designed to be competitive with that of the Company’s peer banks. In establishing the base salary for the named executive officers, the Committee relies on an evaluation of the officers’ level of responsibility and performance and, historically, on comparative information, including the Virginia Bankers Association’s Salary Survey of Virginia Banks. In establishing the base salary, other than for the Chief Executive Officer, the Committee also receives and takes into account the individual compensation recommendations from the Chief Executive Officer. The salary of the Chief Executive Officer is also approved by the independent members of the Board of Directors, upon recommendation of the Committee.
Each of the named executive officers entered into an employment agreement with the Company in 2008, in connection with the mergers with TransCommunity Financial and BOE Financial, and certain of these agreements provide for an initial base salary. A summary of each of these agreements is set forth below following the Summary Compensation Table.
In December 2008, the Committee reviewed recommendations, from the Chief Executive Officer, for salary increases for the named executive officers, other than the Chief Executive Officer, for the 2009 year. These recommendations were based on a number of factors, including the performance of each officer during the year, the responsibilities that each officer had and a general overview of comparative information. The Committee made several modifications to these recommendations in setting salaries for 2009. The Committee also discussed salary increases for the Chief Executive Officer and set an increase for 2009 using similar factors.
Annual Bonuses
For the 2009 year, the Company did not have a formal bonus plan that specifies potential bonus amounts in terms of a percentage of base salary. Cash bonus awards were entirely at the discretion of the Committee. In determining whether or not to award cash bonuses and the level of such bonuses for a given year, the Committee considers the overall performance of the Company, including but not limited to such factors as earnings per share, return on equity, growth and shareholder value, as well as a subjective evaluation of the executive officer’s individual performance. Cash bonus awards for similar executives in market comparisons may also be considered.
In December 2009, the Committee reviewed recommendations, from the Chief Executive Officer, for cash bonuses for the named executive officers, other than the Chief Executive Officer, for 2009. These recommendations were based on a number of factors, including the Company’s accomplishments during 2009, its position as it relates to future opportunities and the Company’s 2009 results and profitability. The Committee approved bonuses for the named executive officers as set forth in the Summary Compensation Table below. Gary A. Simanson, who was the Company’s chief strategic officer until April 2010, was not eligible to receive an annual bonus for 2009 because he was deemed to be the Company’s most highly compensated employee under the TARP rules during 2009. With respect to a 2009 bonus for the Chief Executive Officer, the Committee discussed the same factors that it had reviewed for the other named executive officers and approved a 2009 performance bonus as set forth in the Summary Compensation Table.
For 2010, the Committee expects to adopt an incentive-based bonus plan that ties bonus payments to one or more of the Company’s operating metrics. While the Committee will retain the ability to pay performance bonuses in its discretion, the primary factor for 2010 bonuses to the named executive officers will be objective performance criteria.
Other Bonus Awards
Mr. Simanson’s employment agreement provides for the payment of a cash bonus award for financial advisory and other services that he renders in connection with the negotiation and consummation of a merger or other business combination involving the Company or any of its affiliates or the acquisition by the Company or any of its affiliates of a substantial portion of the assets or deposits of another financial institution. In February 2010, the Committee and the Company’s Board of Directors approved two transaction-based bonus awards to Mr. Simanson under this provision. The bonus awards related to Mr. Simanson’s financial advisory and other services with respect to the Bank’s acquisition of certain assets and assumption of all deposit liabilities of four former branch offices of The Community Bank on November 21, 2008 and the Bank’s acquisition of certain assets and assumption of all deposit
liabilities of seven former branch offices of Suburban Federal Savings Bank on January 30, 2009. The amounts of the bonus awards are (i) $1,169,445, calculated as 0.50% of the total amount of non-brokered deposits that the Bank assumed in the November 2008 transaction and (ii) $1,816,430, calculated as 0.50% of the total amount of loans and other assets that the Bank acquired in the January 2009 transaction. The Company believes that these bonus awards are permitted under the rules and regulations of the TARP Capital Purchase Program. As of the date of this proxy statement, the Company is actively discussing with the Federal Reserve Bank of Richmond.Richmond and the Virginia Bureau of Financial Institutions certain issues with respect to the payment of these bonus awards. These issues include the compliance of the terms and structure of the bonus awards with Federal Reserve System Regulation W and the rules and regulations of the TARP Capital Purchase Program. The Company is working diligently to resolve these issues. The Company cannot make any assurances as to the amount of these bonus awards, if any, that will ultimately be paid following the resolution of these issues.
In approving the 2010 transaction-based bonus awards to Mr. Simanson, the Committee discussed a number of issues with respect to the award, including the work involved in managing the Company’s entry into a FDIC-assisted transaction for the first time, the work involved in managing the first follow-on acquisitions for a newly created operating company, the entry of the Bank into two new states, significant negotiations and interaction with the FDIC, the lack of an internal management skill set to handle the transactions and the fact that the transactions would likely not have been possible without Mr. Simanson’s contacts with the FDIC. The Committee also noted the different management challenge that the transactions presented and the general uniqueness of the transactions at the time. The Committee agreed further to base the awards on criteria tied directly to the balance-sheet items that were critical to the Bank’s entering into the transactions.
Long-Term Incentives
In 2009, the Company adopted the Community Bankers Trust Corporation 2009 Stock Incentive Plan. The purpose of the plan is to further the long-term stability and financial success of the Company by attracting and retaining employees and directors through the use of stock incentives and other rights that promote and recognize the financial success and growth of the Company. The Company believes that ownership of Company stock will stimulate the efforts of such employees and directors by further aligning their interests with the interests of the Company’s stockholders. The plan is to be used to grant restricted stock awards, stock options in the form of incentive stock options and nonstatutory stock options, stock appreciation rights and other stock-based awards to employees and directors of the Company. As adopted, the plan makes available up to 2,650,000 shares of common stock for issuance to participants under the plan.
In adopting the plan, the Committee received assistance from its independent consultant. The consultant created a large peer group of community banks nationally with assets between $500 million and $2 billion and reviewed data on their outstanding stock grants and shares reserved for grants of future awards in order to assist the Committee in determining an appropriate total share reserve for the plan.
The Company did not make any stock-based awards in the year ended December 31, 2009, but it began making awards under the plan in May 2010.
The Company continues to sponsor each of the TransCommunity Financial Corporation 2001 Stock Option Plan, the TransCommunity Financial Corporation 2007 Equity Compensation Plan, the BOE Financial Services of Virginia, Inc. Stock Incentive Plan and the BOE Financial Services of Virginia, Inc. Stock Option Plan for Outside Directors and the awards that remain outstanding under those plans.
In the future, the Company expects that any stock option grants and stock awards to executive officers will be made at regularly scheduled Committee meetings. The Company’s Chief Executive Officer will provide the Committee with a recommendation concerning the recipients, the reason for the award and the number of shares to be awarded. The grant date will generally be the date of the meeting when the Committee approves awards. The Company will not tie the timing of the issuance of stock options or stock awards to the release or withholding of material non-public information.
Retirement Program
The Company’s retirement program is designed to provide executive officers with an appropriate level of financial security and income, following retirement, relative to their pre-retirement earnings. The Company believes that its retirement program has been a valuable tool in attracting and retaining highly qualified employees. The retirement program historically has been reflective of common practices among companies of similar size and structure.
The components of the Company’s retirement program include the following:
a noncontributory defined benefit pension plan (which is currently frozen to new entrants) for all full-time employees who are 21 years of age or older and who have completed one year of eligibility service
a non-tax qualified Supplemental Executive Retirement Plan for certain executives to supplement the benefits that such executives can receive under other components and social security
a 401(k) employee savings plan for which all full-time employees who are 21 years of age or older are eligible to participate
16Additional information with respect to these components is set forth below. The Company did not make any changes to the retirement program during the 2009 year.
Perquisites and Fringe Benefits
Perquisites and fringe benefits are designed to provide certain personal benefits and to fund certain expenditures that are common among executive officers in many companies. The Committee believes that this component of compensation is a valuable tool in attracting, motivating, rewarding and recruiting highly qualified employees. The Committee will review the level of these benefits on an annual basis.
The employment agreements with Messrs. Longest, Thomas and Simanson provide for an automobile or automobile allowance, with appropriate insurance coverage and maintenance expenses. The employment agreements with Messrs. Longest and Thomas also provide for the payment or reimbursement for country club dues that may be incurred.
Post-Termination Compensation
Under the Company’s employment agreements, the named executive officers may be entitled to post-termination compensation in certain cases. These provisions are detailed further and quantified in the section below titled “Post-Employment Compensation.”
In connection with the Company’s receipt of TARP funds, each named executive officer signed a waiver of acknowledgement that the TARP regulation in effect at such time may require modification of the compensation, bonus, incentive, and other benefits plans, policies, and agreements that the Company
has that affect the executive’s compensation. These restrictions significantly modify the provisions of the agreements that the Company has with the named executive officers that relate to severance payments in the event of an officer’s termination of employment.
In addition, in 2008 each of the named executive officers entered into a letter agreement with the Company amending the benefit plans with respect to such officer as may be necessary, during the period that Treasury owns any debt or equity securities of the Company, to comply with Section 111(b) of EESA, as amended by ARRA.
Compensation Limitations for TARP Recipients
The following is a summary of certain executive compensation limitations under the EESA and the ARRA:
a requirement to recover any bonus payment to a senior executive officer or any of the next 20 most highly compensated employees if payment was based on materially inaccurate financial statements or performance metric criteria
a prohibition on making any golden parachute payments to a senior executive officer or any of the next five most highly compensated employees
a prohibition on paying or accruing any bonus payment to the most highly compensated employee, except as otherwise permitted by the rules
a prohibition on maintaining any plan for senior executive officers that encourages such officers to take unnecessary and excessive risks that threaten the Company’s value
a prohibition on maintaining any employee compensation plan that encourages the manipulation of reported earnings to enhance the compensation of any employee
a prohibition on providing tax gross-ups to a senior executive officer or any of the next 20 most highly compensated employees
The Committee reviews these and other requirements under the EESA and the ARRA in making its compensation determinations with respect to the Company’s senior management, including the named executive officers.
The table below sets forth, for the years ended December 31, 2009, December 31, 2008 and December 31, 2007, the compensation earned by the following named executive officers:
the individuals who served as the Company’s principal executive officer and the principal financial officer during 2009
the three other most highly compensated executive officers who were executive officers at December 31, 2009
The compensation presented in the table includes compensation paid by TransCommunity Financial and BOE Financial, as the case may be, prior to their merger with and into the Company on May 31, 2008.
| Non-Equity | Non-Qualified | |||||||||||||||||||||||||||||||||||
| Incentive | Deferred | |||||||||||||||||||||||||||||||||||
| Stock | Option | Plan | Compensation | All Other | ||||||||||||||||||||||||||||||||
| Name and | Salary | Bonus | Awards | Awards | Compensation | Earnings | Compensation | Total | ||||||||||||||||||||||||||||
| Principal Position | Year | ($) | ($) | ($) (6) | ($) (6) | ($) | ($) (7) | ($) (8) | ($) | |||||||||||||||||||||||||||
George M. Longest, Jr. | 2008 | 211,000 | 25,000 | — | — | — | 83,229 | 6,187 | 325,416 | |||||||||||||||||||||||||||
President and Chief Executive Officer (1) | 2007 | 160,000 | 15,245 | — | — | — | 53,909 | 3,200 | 232,354 | |||||||||||||||||||||||||||
Gary A. Simanson | 2008 | 158,885 | 750,000 | — | — | — | — | 3,204 | 908,885 | |||||||||||||||||||||||||||
Vice Chairman and Chief Strategic Officer (and former President, Chief Executive Officer and Chief Financial Officer) (2) | 2007 | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Bruce E. Thomas | 2008 | 156,731 | 17,500 | — | — | — | 40,057 | 7,225 | 221,513 | |||||||||||||||||||||||||||
Senior Vice President and Chief Financial Officer (3) | 2007 | 120,000 | 10,745 | — | — | — | 25,145 | 2,400 | 158,290 | |||||||||||||||||||||||||||
Patrick J. Tewell | 2008 | 133,333 | 16,500 | — | — | — | — | 11,905 | 161,738 | |||||||||||||||||||||||||||
Senior Vice President and Chief Accounting Officer (4) | 2007 | 110,000 | 43,000 | 19,375 | 12,150 | — | — | 9,990 | 194,775 | |||||||||||||||||||||||||||
Bruce B. Nolte | 2008 | 111,179 | — | — | — | — | — | 9,603 | 120,782 | |||||||||||||||||||||||||||
Former Chief Executive Officer (5) | 2007 | 173,300 | 40,690 | 42,625 | — | — | — | 32,384 | 288,999 | |||||||||||||||||||||||||||
Name and Principal Position
| Year
| Salary ($) | Bonus ($) | Stock Awards ($) (6) | Option Awards ($) (6) | Non- Equity Incentive Plan sation ($) | Non- Qualified Deferred sation ($) (7) | All Other sation ($) (8) | Total ($) | |||||||||
George M. Longest, Jr. President and Chief Executive Officer (1) | 2009 2008 2007
| 250,000 211,000 160,000
| 35,000 25,000 15,245
| -- -- --
| -- -- --
| -- -- --
| 86,681 83,229 53,909
| 10,709 6,187 3,200
| 382,390 325,416 232,354
| |||||||||
Bruce E. Thomas Senior Vice President and Chief Financial Officer (2)
| 2009 2008 2007
| 165,000 156,731 120,000
| 17,500 17,500 10,745
| -- -- --
| -- -- --
| -- -- --
| 41,554 40,057 25,145
| 9,496 7,225 2,400
| 233,550 221,513 158,290
| |||||||||
Gary A. Simanson Former Chief Strategic Officer (3) | 2009 2008 2007
| 280,000 158,885 --
| -- 750,000 --
| -- -- --
| -- -- --
| -- -- --
| -- -- --
| 8,388 3,204 --
| 288,388 912,089 --
| |||||||||
M. Andrew McLean Executive Vice President and Chief Development Officer, Essex Bank (4)
| 2009 | 210,000 | 18,500 | -- | -- | -- | -- | 22,940 | 251,440 | |||||||||
Patrick J. Tewell Operational Risk Management Officer, Essex Bank (5)
| 2009 2008 2007 | 150,000 133,333 110,000 | 16,500 16,500 43,000 | -- -- 19,375 | -- -- 12,150 | -- -- -- | -- -- -- | 12,573 11,905 9,990 | 179,073 161,738 194,515 |
| (1) | Mr. Longest has been the Company’s President since May 2008 and Chief Executive Officer since July 2008. He was President and Chief Executive Officer of BOE Financial until May 2008. |
17
| (2) | ||
| Mr. Thomas has been the Company’s Senior Vice President and Chief Financial Officer since May 2008. He was Senior Vice President and Chief Financial Officer of BOE Financial until May 2008. |
| (3) | Mr. Simanson was the Company’s Chief Strategic Officer from May 2008 to April 2010. He was the Company’s President, Chief Executive Officer and Chief Financial Officer until May 2008. |
| (4) | Mr. McLean became an executive officer of the Company in May 2009 and served as President of the Bank from 2008 to April 2010. |
| (5) | Mr. Tewell | |
| (6) | These amounts reflect the value determined by the Company for accounting purposes for these awards and do not reflect whether the recipient has actually realized a financial benefit from the awards (such as by vesting in a restricted stock award or by exercising stock options). This column represents the dollar amount recognized for financial statement reporting purposes for the applicable fiscal year for awards of restricted stock or stock options, as the case may be, granted to each of the named executive officers, all of which were granted prior to 2008, in accordance with | |
| (7) | Amounts for | |
| (8) | Amounts for |
Employment Agreements
The Company has employment agreements with each of the named executive officers.
The agreements with each of George M. Longest, Jr. and Bruce E. Thomas were effective as of May 31, 2008, which was the effective date of the merger of the Company and BOE Financial. Effective as of that date and pursuant to his employment agreement, Mr. Longest serves as the Company’s
18
The employment agreement with each of Messrs. Longest and Thomas imposes certain limitations on the officer, precluding the officer from soliciting the Company’s or the Bank’s employees and customers and, without the Company’s prior written consent, competing with the Company or the Bank by forming, serving as an organizer, director, officer or consultant to, or maintaining a more than one percent passive investment in a depository financial institution or holding company if such entity has one or more offices or branches located within a 10-mile radius of the headquarters or any branch banking office of the Company or the Bank. These limitations will be for a period of two years from the date on which the officer ceases to be an employee of the Company except that, in the case of a termination without cause or for good reason following a change in control, the non-compete and customer solicitation restrictions will be in force for only one year.
The employment agreement with Gary A. Simanson was effective as of September 29, 2008.2008, and the Company and Mr. Simanson terminated his employment with the Company on April 9, 2010. The agreement governsgoverned the terms of his employment as the Company’s Chief Strategic Officer and Vice Chairman. Except as set forth below, the terms of Mr. Simanson’s agreement arewere substantially similar to the agreements with Messrs. Longest and Thomas. The term of the agreement iswas for three years from the closing date of the mergers. On each anniversary of the merger date, the term of the agreement will bewould have been extended by an additional year unless the Company giveshad given written notice that no further extensions should occur. The financial terms of the agreement includeincluded an annual salary of $270,000 and an upfront cash bonus of $750,000, which was included as part of the Company’s merger expense. Mr. Simanson iswas also eligible to receive a cash bonus payment in an amount determined by the Company for financial advisory and other services that he rendersrendered in connection with the negotiation and consummation of any merger or other business combination involving the Company or any of its affiliates. Mr. Simanson did not receive a salary for his services to the Company prior to the mergers with TransCommunity Financial and BOE Financial.
In February 2010, the Compensation Committee and the Company’s Board of Directors approved two transaction-based bonus awards to Mr. Simanson under his employment agreement. The bonus awards related to Mr. Simanson’s financial advisory and other services with respect to the Bank’s acquisition of certain assets and assumption of all deposit liabilities of four former branch offices of The Community Bank on November 21, 2008 and the Bank’s acquisition of certain assets and assumption of all deposit liabilities of seven former branch offices of Suburban Federal Savings Bank on January 30, 2009. See the “Compensation Discussion and Analysis” section above for additional discussion on these bonus awards.
The agreement prohibits Mr. Simanson from competing with the Company following the termination of his employment, from soliciting employees and customers of the Company, and from divulging confidential information obtained while employed with the Company. These restrictions will extend for a two year period following the termination of employment, except that, in the case of a termination without cause or for good reason following a change in control, the non-compete and customer solicitation restrictions will be in force for only one year.
The agreementagreements with Mr.each of M. Andrew McLean and Patrick J. Tewell waswere with TransCommunity Financial and waswere effective as of May 27, 2008. The Company succeeded to all of the rights and obligations of TransCommunity Financial as of May 31, 2008, the effective date of the merger of the Company and TransCommunity Financial. Effective as of that date and pursuant to his employment agreement, Mr. McLean served as the President of TransCommunity Bank, which merged into the Bank in July 2008, at a salary of $185,000 per year with base salary increases and incentive, bonus compensation or other compensation in the amounts determined by the Board of Directors. Also effective as of that date and pursuant to his employment agreement, Mr. Tewell servesserved as the Company’s Chief Accounting Officer at a salary of $140,000 per year with base salary increases and incentive, bonus compensation or other compensation in the amounts determined by the boardBoard of directors.Directors. The term of hiseach employment agreement is until May 27, 2011. The employment agreement includes certain covenants not to compete, provided employment is not terminated for “cause.” Mr. Tewell’sEach employment agreement precludes himthe officer from inducing or soliciting any employee of the Company to terminate his or her relationship with the Company for a period of 12 months from the date on which he ceases to be an employee of the Company.
19
Grants of his employment with the Company, Mr. Nolte was a party to an employment agreement similar to Mr. Tewell’s. Under his agreement, Mr. Nolte served as the Company’s Chief Executive Officer at a salary of $205,000 per year with base salary increases and incentive, bonus compensation or other compensation in the amounts determined by the board of directors. The term of Mr. Nolte’s employment agreement was until December 31, 2009. In addition, Mr. Nolte’s employment agreement precluded him from serving as Chief Executive Officer or other executive officer of any bank or bank holding company within 25 miles of headquarters of the Company or within 25 miles of any bank branch operated by the Company. It also precluded him from inducing or soliciting any employee of the Company to terminate his or her relationship with the Company, soliciting or diverting away or attempting to solicit or divert away any customer of the Company for the purpose of selling or providing competitive services for a period of 24 months from the date on which he ceased to be an employee of the Company.
Prior to their mergers with and into the Company, both TransCommunity Financial and BOE Financial maintained plans that provided for stock-based awards as incentives for certain officers and directors. Under the terms of these plans, all options and awards that were outstanding at the time of the mergers were fully vested and exercisable, and any unrecognized compensation expenses were accelerated. In connection with the mergers, the Company adopted all awards that were outstanding under such plans, but terminated the plans so that no further awards will be made under them. No
In 2009, the Company adopted the Community Bankers Trust Corporation 2009 Stock Incentive Plan. The plan is to be used to grant restricted stock awards, stock options in the form of incentive stock options and nonstatutory stock options, stock appreciation rights and other stock-based awards were madeto employees and directors of the Company. As adopted, the plan makes available up to 2,650,000 shares for issuance to participants under the plan.
The Company did not make any stock-based awards during 2008.
20
The following table shows outstanding option awards held by the named executive officers as of December 31, 2008.2009. There were no outstanding stock awards that had not yet vested.
| Option Awards | ||||||||||||||||||||
| Equity | ||||||||||||||||||||
| Incentive Plan | ||||||||||||||||||||
| No. of | No. of | Awards: No. of | ||||||||||||||||||
| Securities | Securities | Securities | ||||||||||||||||||
| Underlying | Underlying | Underlying | ||||||||||||||||||
| Unexercised | Unexercised | Unexercised | Option | |||||||||||||||||
| Options | Options | Unearned | Exercise | Option | ||||||||||||||||
| (#) | (#) | Options | Price | Expiration | ||||||||||||||||
| Name | Exercisable | Un-exercisable | (#) | ($) | Date | |||||||||||||||
| Longest | 3,878 | — | — | 5.01 | 11/18/2014 | |||||||||||||||
| 2,543 | — | — | 4.36 | 10/23/2013 | ||||||||||||||||
| 2,635 | — | — | 3.91 | 6/27/2012 | ||||||||||||||||
| 3,139 | — | — | 2.14 | 1/6/2011 | ||||||||||||||||
| Simanson | — | — | — | — | — | |||||||||||||||
| Thomas | 2,755 | — | — | 5.01 | 11/18/2014 | |||||||||||||||
| 2,005 | — | — | 4.36 | 10/23/2013 | ||||||||||||||||
| Tewell | 7,100 | — | — | 5.99 | 3/28/2017 | |||||||||||||||
| Nolte | 47,570 | — | — | 7.04 | 4/15/2013 | |||||||||||||||
| Name |
Option Awards | |||||||||||||||||||
No. of (#) Exercisable | No. of (#) Un-exercisable |
Equity (#) | Option ($) | Option Expiration Date | ||||||||||||||||
Longest | 3,878 | -- | -- | 5.01 | 11/18/2014 | |||||||||||||||
| 2,543 | -- | -- | 4.36 | 10/23/2013 | ||||||||||||||||
| 2,635 | -- | -- | 3.91 | 6/27/2012 | ||||||||||||||||
| 3,139 | -- | -- | 2.14 | 1/6/2011 | ||||||||||||||||
Thomas | 2,755 | -- | -- | 5.01 | 11/18/2014 | |||||||||||||||
| 2,005 | -- | -- | 4.36 | 10/23/2013 | ||||||||||||||||
Simanson | -- | -- | -- | -- | -- | |||||||||||||||
McLean | 4,402 | -- | -- | 7.04 | 4/15/2013 | |||||||||||||||
Tewell | 7,100 | -- | -- | 5.99 | 3/28/2017 | |||||||||||||||
Option Exercises
There were no exercises of stock options by any of the named executive officers during the year ended December 31, 2009.
Post-Employment Compensation
Pension Plan
The Bank maintains a non-contributory defined benefit pension plan for all full-time employees who are 21 years of age or older and who have completed one year of eligibility service. The plan was frozen to new entrants prior to the merger of BOE Financial with and into the Company. Messrs. Longest and Thomas are participants in this plan. Benefits payable under the plan are based on years of credited service, average compensation over the highest consecutive five years, and the plan’s benefit formula (1.60% of average compensation times years of credited service up to 20 years, plus 0.75% of average compensation times years of credit service in excess of 20 years, but not in excess of 35 years plus .65% (70% if SSNRA is 66)0.65% of average compensation in excess of Social Security Covered Compensation times years of credited service up to a maximum of 35 years). For 2008,2009, the maximum allowable annual benefit payable by the plan at age 65 (the plan’s normal retirement age) was $185,000$195,000 and the maximum compensation covered by the plan was $225,000.$245,000. Reduced early retirement benefits are payable on or after age 55 upon completion of 10 years of credited service. Amounts payable under the plan are not subject to reduction for Social Security benefits.
The following table provides the actuarial present value of each named executive officer’s total accumulated benefit under the pension plan as of December 31, 2009:
| Name | Plan Name | Number of (#) | Present Value ($) | Payments ($) | ||||||||||||
Longest | Pension Plan | 21 | 258,338 | -- | ||||||||||||
Thomas | Pension Plan | 19 | 132,831 | -- | ||||||||||||
Simanson | -- | -- | -- | -- | ||||||||||||
McLean | -- | -- | -- | -- | ||||||||||||
Tewell | -- | -- | -- | -- |
Supplemental Executive Retirement Plan
The Bank has adopted a non-tax qualified supplemental executive retirement plan (“SERP”) for certain executives to supplement the benefits that such executives can receive under the Bank’s other retirement programs and social security. Messrs. Longest and Thomas are participants in the SERP. Retirement benefits under the SERP vary by individual and are payable at age 65 for 15 years or life, whichever is longer. In the event of termination prior to age 65 (for reasons other than death, subsequent
21
The following table provides specific information for each named executive officer for the non-tax qualified supplemental executive retirement plan as of December 31, 2009:
| Name | Executive ($) | Registrant ($) |
Aggregate ($) (1) | Aggregate ($) | Aggregate ($) | |||||||||||||||
Longest | -- | -- | 26,736 | -- | 103,480 | |||||||||||||||
Thomas | -- | -- | 10,970 | -- | 42,460 | |||||||||||||||
Simanson | -- | -- | -- | -- | -- | |||||||||||||||
McLean | -- | -- | -- | -- | -- | |||||||||||||||
Tewell | -- | -- | -- | -- | -- |
| (1) | None of these amounts is included in the amounts reported in the salary column of the Summary Compensation Table for the named executive officers in the current or prior years. |
401(k) Employee Savings Plan
The Company sponsors a 401(k) plan for all of its eligible employees. The executive officers of the Company participate in the 401(k) plan on the same basis as all other eligible employees of the Company.
Employment Agreements
The employment and change in control agreements with each of the Company’s named executive officers provide for the payment of severance and other benefits in the event of certain termination scenarios.
Employment Agreements
The employment agreement with each of Messrs. Longest and Thomas provides for the payment of two months salary upon the death of the officer. In the case of termination by the Company without cause or by the officer for good reason, the employment agreement requires that the officer receive his base salary and certain health benefits for 24 months following the date of termination. For the purposes of each employment agreement, good reason means the continued assignment to the officer of duties inconsistent with the officer’s position as contemplated in the agreement, any action taken by the Company that results in a substantial reduction in the officer’s status, the relocation of the officer to any other primary place of employment that might require him to move his residence, which includes any reassignment to a place of employment located more than 35 miles from his initially assigned place of employment (which includes both Tappahannock and Richmond, Virginia) without his written consent, and any failure by the Company, or any successor following a change in control, to comply with the compensation and benefit requirements of the employment agreement. Each agreement also provides that within two years following a change in control, if employment is terminated by the surviving corporation without cause or by the officer for good reason within 120 days after the occurrence of good reason, the officer will be entitled to accrued obligations, a salary continuance benefit equal to 2.99 times his final compensation and health care continuance.
The employment agreement with Mr. Simanson providesprovided for the continuation of his base salary and certain health benefits for two years following a termination of employment with the Company by Mr. Simanson for good reason or a termination of employment by the Company without cause. The agreement also provides that, within two years following a change in control, if his employment is terminated without cause or for good reason, Mr. Simanson will bewould have been entitled to a salary continuance benefit equal to 2.99 times his final compensation, excluding certain one-time payments, and the continuation of certain health benefits for three years. The agreement further providesprovided that, in connection with the termination of his employment following a change in control, the Company will paywould have paid Mr. Simanson a gross-up payment equal to the amount of any excise taxes (plus the applicable federal and state income and other taxes due on such gross-up payment) payable by Mr. Simanson if the aggregate value of the salary continuance benefit and related health benefits exceeds the threshold amount that triggers the excise tax for federal tax purposes. In order to avoid the expense of the excise tax in a situation where Mr. Simanson would realize a nominal benefit, the Company will bewould have been required to make the tax gross-up payment only if the value of the aggregate payments and benefits due Mr. Simanson exceeds by $25,000 the threshold amount that would avoid triggering the excise tax. If the value of such payments and benefits is less than the $25,000 differential, the payments and benefits will bewould have been reduced to the extent necessary so as not to trigger the excise tax.
22
Change in Control Agreement
Each of Mr. McLean and Mr. Tewell entered into a change in control agreement with TransCommunity Financial, effective as of May 27, 2008. The Company succeeded to all of the rights and obligations of TransCommunity Financial as of May 31, 2008, the effective date of the merger of the Company and TransCommunity Financial. In the event that a change in control occurs during employee’s employment and, within the period beginning on the date of closing of the change in control and ending one year after, Mr. Tewell’sthe officer’s employment with the Company is terminated by the Company without cause or by him for good reason, the Company will owe him certain severance pay, benefits and vesting of stock awards. Mr. McLean’s change in control agreement provides for two times the sum of his annual base salary in effect on his termination of employment or the change in control date, whichever is greater,
plus the amount of any bonus paid to him during the calendar year preceding the calendar year in which the change in control occurs. Mr. Tewell’s change in control agreement provides for one times the sum of his annual base salary in effect on his termination of employment or the change in control date, whichever is greater, plus the amount of any bonus paid to him during the calendar year preceding the calendar year in which the change in control occurs. The Company will also continue to provide certain health and life insurance benefits to Mr. Tewellthe officer for a period up to one year following the date of termination.
Each agreement also provides to the extent that Mr. Tewellthe officer has been granted options, stock awards or other equity compensation under the Company’s equity compensation plan, that upon a change in control, his interest in such awards be fully exercisable, vested and nonforfeitable as of the date of the change in control.
Certain LimitationsPotential Payments Upon Termination
The following table quantifies the expected payments to the named executive officers in different, specified employment termination circumstances under their employment agreements and change in control agreements. Benefits payable under the non-tax qualified supplemental executive retirement plan, the tax-qualified retirement plan and 401(k) plan are not included. In addition, all stock options that the named executive officers hold have vested.
The information below assumes that termination of employment occurred on Post-Employment Compensation
23
Name
| Benefit
| Death or Disability ($) | Before Change Termination Without Cause or for Good Reason ($) | After Change Termination Without Cause or for Good Reason ($) | ||||||||||||||||
George M. Longest, Jr. | Post-termination compensation | 41,667 | 500,000 | 837,200 | ||||||||||||||||
Health care benefits continuation | -- | 12,000 | 18,000 | |||||||||||||||||
Total Value | 41,667 | 512,000 | 855,200 | |||||||||||||||||
Bruce E. Thomas | Post-termination compensation | 27,500 | 330,000 | 545,675 | ||||||||||||||||
Health care benefits continuation | -- | 12,000 | 18,000 | |||||||||||||||||
Total Value | 27,500 | 342,000 | 563,675 | |||||||||||||||||
Gary A. Simanson | Post-termination compensation | 46,667 | 560,000 | 837,200 | ||||||||||||||||
Health care benefits continuation | -- | 12,000 | 18,000 | |||||||||||||||||
Total Value | 46,667 | 572,000 | 855,200 | |||||||||||||||||
M. Andrew McLean | Post-termination compensation | -- | 438,500 | 438,500 | ||||||||||||||||
Health care benefits continuation | -- | 6,000 | 6,000 | |||||||||||||||||
Total Value | -- | 444,500 | 444,500 | |||||||||||||||||
Patrick J. Tewell | Post-termination compensation | -- | 166,500 | 166,500 | ||||||||||||||||
Health care benefits continuation | -- | 6,000 | 6,000 | |||||||||||||||||
Total Value | -- | 172,500 | 172,500 |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Some of the Company’s directors and executive officers are at present, as in the past, its banking customers. As such, the Company has had, and expects to have in the future, banking transactions with directors, officers, principal stockholders and their associates, on substantially the same terms, including interest rates and collateral on loans, as those prevailing at the same time for comparable transactions with others. These transactions do not involve more than the normal risk of collectibility or present other unfavorable features. In connection with its acquisition of TransCommunity Financial and BOE Financial, the Company assumed loans to directors and executive officers, and their associates, with an aggregate outstanding balance of $3.0 million. The aggregate outstanding balance of loans to such parties at December 31, 20082009 was $4.7$7.2 million.
The Company has not adopted a formal policy that covers the review and approval of related person transactions by its Board of Directors.Directors that is separate from the Code of Conduct and Ethics that applies to directors, officers and all employees of the Company and its subsidiaries. The Board however, does reviewreviews all proposed related party transactions for approval. During such a review, the Board will consider, among other things, the related person’s relationship to the Company, the facts and circumstances of the proposed transaction, the aggregate dollar amount of the transaction, the related person’s relationship to the transaction and any other material information. Those directors that are involved in a proposed related party transaction are excused from the Board and/or committee meeting during the discussion and vote of the proposal.
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| Number of Securities | ||||||||||||
| Remaining Available | ||||||||||||
| for Future Issuance | ||||||||||||
| Under Equity | ||||||||||||
| Number of Securities | Compensation Plans | |||||||||||
| to be Issued | Weighted-Average | (Excluding | ||||||||||
| Upon Exercise of | Exercise Price of | Securities | ||||||||||
| Outstanding Options, | Outstanding Options, | Reflected in | ||||||||||
| Plan Category | Warrants and Rights | Warrants and Rights | First Column) | |||||||||
| Equity Compensation Plans Approved by Security Holders (1) | 493,777 | $ | 5.95 | 951,785 | ||||||||
| Equity Compensation Plans Not Approved by Security Holders | — | — | — | |||||||||
| Total | 493,777 | $ | 5.95 | 951,785 | ||||||||
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On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009 (the “ARRA”)ARRA into law. The ARRA includes a provision, commonly referred to as “Say-on-Pay,” that requires any recipient of funds in the Troubled Assets ReliefTARP Capital Purchase Program (the “TARP”) to permit a separate stockholder vote to approve the compensation of executives, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission.
In order to comply with ARRA as a recipient of TARP funds, the Company is providing you the opportunity, as a stockholder, to endorse or not endorse the Company’s executive pay programs and policies through the following resolution:
“RESOLVED, that the stockholders approve the compensation of executive officers as disclosed in this proxy statement pursuant to the rules of the Securities and Exchange Commission.”
Non-binding approval of the Company’s executive compensation program would require that a majority of the shares present or represented at the Annual Meeting vote in favor of the proposal. Abstentions and broker non-votes will not be counted as votes cast and therefore will not affect the determination as to whether the Company’s executive compensation program as disclosed in this proxy statement is approved.
Because your vote is advisory, it will not be binding upon the Board of Directors, overrule any decision made by the Board of Directors or create or imply any additional fiduciary duty by the Board of Directors. The Compensation Committee, however, may take into account the outcome of the vote when considering future executive compensation arrangements.
The Board of Directors recommends that the stockholders voteFORProposal Three.
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PUBLIC ACCOUNTING FIRM
General
Elliott Davis, LLC (“Elliott Davis”), an independent registered public accounting firm, served as the Company’s independent registered public accounting firm during the year ended December 31, 2008,2009, and has been selected by the Audit Committee to serve as the Company’s independent registered public accounting firm for the current fiscal year. Representatives of Elliott Davis will be present at the Annual Meeting, will have the opportunity to make a statement if they so desire and will be available to respond to appropriate questions.
Although stockholder ratification is not required by the Company’s Bylaws or otherwise, the Board, as a matter of good corporate governance, is requesting that stockholders ratify the selection of Elliott Davis as the Company’s independent registered public accounting firm for the 20092010 year. If stockholders do not ratify the selection of Elliott Davis, the Audit Committee will reconsider its appointment.
The Board of Directors recommends that stockholders voteFORratification of the appointment of Elliott Davis as the Company’s independent registered public accounting firm for the 20092010 year.
Recent Changes in Accounting Firms
As summarized below, the Company changed its independent registered public accounting firm in each of 2008, following the mergers with TransCommunity Financial and BOE Financial, and 2007.
On June 20, 2008, the Audit Committee engaged Elliott Davis to serve as the independent registered public accounting firm to audit the Company’s consolidated financial statements for the year ended December 31, 2008. In deciding to select Elliott Davis, the Audit Committee reviewed auditor independence issues and existing commercial relationships with Elliott Davis and concluded that Elliott Davis had no commercial relationship with the Company that would impair its independence for the year ended December 31, 2008. Elliott Davis served as the independent registered public accounting firm for TransCommunity Financial from its engagement on May 4, 2007 until TransCommunity Financial’s merger with and into the Company effective May 31, 2008. During the two fiscal years ended December 31, 2007 and through June 20, 2008, the Company did not consult with Elliott Davis regarding any of the matters or events that would require disclosure under the rules of the Securities and Exchange Commission.
Miller, Ellin & Company, LLP (“Miller Ellin”), who had served as the Company’s independent registered public accounting firm for the 2007 year, was notified of the engagement of Elliott Davis on June 24, 2008. The reports of Miller Ellin on the Company’s consolidated financial statements for the fiscal years ended March 31, 2007 and December 31, 2007 did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principle. In addition, during the period from its engagement through the fiscal year ended December 31, 2007 and through March 31, 2008, there were no (1) disagreements with Miller Ellin on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which
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Fees
The following table presents fees billed to the Company by the principal accountant for the years ended December 31, 20082009 and December 31, 2007:
| 2008 | 2007 | |||||||
Audit Fees | $ | 193,760 | $ | 18,280 | ||||
Audit-Related Fees | $ | 19,375 | $ | 6,170 | ||||
Tax Fees | $ | 15,025 | $ | 3,709 | ||||
All Other Fees | $ | 3,888 | $ | 5,483 | ||||
| 2009 | 2008 | |||||||||||
Audit Fees | $442,960 | $169,000 | ||||||||||
Audit-Related Fees | $94,367 | $30,000 | ||||||||||
Tax Fees | $22,800 | $15,000 | ||||||||||
All Other Fees | -- | -- |
Audit Feesinclude fees billed for the audit of the Company’s annual consolidated financial statements, andquarterly reviews of the Company’s unaudited financial statements, the review of proposed amended filings from the Company to the Securities and Exchange Commission and audits of the Company’s predecessor entities for the period ended May 31, 2008.
Audit-Related Fees include fees billed for services rendered in connection with the audit of the Company’s assessment of internal control over financial reporting quarterly reviews of unaudited financial statements, and consents andfor other services related to registration statements filed with the Securities and Exchange Commission.
Tax Feesinclude fees billed for tax compliance, tax advice, tax planning and the preparation of federal tax forms.
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The Audit Committee of the Board of Directors has adopted policies and procedures for the pre-approval of services provided by the Company’s independent registered public accounting firm. These services may include audit services, audit-related services, tax services and other services. Such policies and procedures provide that the Audit Committee shall pre-approve all auditing and permitted non-audit services (including the fees and terms thereof).
As permitted under the Sarbanes-Oxley Act of 2002 and its pre-approval policies and procedures, the Audit Committee may form and delegate pre-approval authority for audit and permitted non-audit services to a subcommittee consisting of one or more members of the Audit Committee. Any service pre-approved by a delegateits Chair. The Chair must be reportedthen report any pre-approval decisions to the Audit Committee at the next scheduled meeting
The Audit Committee acts under a written charter adopted by the Board of Directors. The Committee’s primary purpose is to assistCommittee assists the Board of Directors in the fulfillment of its oversight responsibilities with respect to the completeness and accuracy of the Company’s financial reporting and the adequacy of its financial and operating controls. Management is responsible for the preparation, presentation and integrity of the Company’s financial statements; accounting and financial reporting principles; internal controls; and procedures designed to assure compliance with accounting standards and applicable laws and regulations. The independent registered public accounting firm which was Miller, Ellin & Company, LLP until June 20, 2008 and Elliott Davis, LLC thereafter, is responsible for performing an independent audit of the consolidated financial statements and of the Company’s internal control over financial reporting in accordance with the standards of the Public Company Accounting Oversight Board.
The Audit Committee has reviewed and discussed the Company’s audited financial statements for the year ended December 31, 20082009 with each of management and the independent registered public accounting firm. The Committee has also discussed with each party the Company’s compliance with Section 404 of the Sarbanes-Oxley Act relative to testing of internal control over financial reporting. The Committee has further discussed with the independent registered public accounting firm the matters required to be discussed with it under Statement onPCAOB Auditing Standards No. 61,Standard AU Section 380, Communication with Audit Committees, as adoptedand Rule 2-07 of Regulation S-X promulgated by the Public Company Accounting Oversight Board.
The Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the Public Company Accounting Oversight BoardPCAOB Rule 3526, Communication with respect to communications with the Committee concerning independence from the Company.Audit Committees Regarding Independence. The Committee has also discussed with the independent registered public accounting firm its independence and has considered whether the provision of specific non-audit services by the independent registered public accounting firm is compatible with maintaining its independence.
The Audit Committee has discussed with management its assessment of the effectiveness of internal control over financial reporting and has also discussed with the independent registered public accounting firm its opinion as to the effectiveness of the Company’s internal control over financial reporting.
Based on the review and discussions described in this report, and subject to the limitations on its role and responsibilities described in this report and in its charter, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008.
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Audit Committee
Troy A. Peery, Jr., ChairGeorge B. Elliott
Philip T. Minor
Eugene S. Putnam, Jr.
Robin Traywick Williams
Date: May 7, 2009
All proposals, including nominations for directors, submitted by stockholders for presentation in the proxy statement for the 20102011 annual meeting of stockholders must comply with the Securities and Exchange Commission’s rules regarding stockholder proposals. In addition, the Company’s Bylaws require that for any business to be properly brought before an annual meeting by a stockholder, the Company’s Secretary must have received written notice thereof not less than 60 nor more than 90 days prior to the meeting (or not later than 10 days after a notice or public disclosure of such meeting date if such disclosure occurs less than 70 days prior to the date of the meeting). The notice must set forth:
for nominations for directors, as to each person whom the stockholder proposes to nominate for election as a director:
| o | the name, age, business address and residence address of the person; | ||
| o | the principal occupation or employment of the person; | ||
| o | the class and number of shares of capital stock of the Company that are beneficially owned by the person; and | ||
| o | any other information relating to the person that is required to be disclosed in solicitations for proxies for election of directors pursuant to the rules and regulations of the Securities and Exchange Commission; and |
for other business, as to each matter the stockholder proposes to bring before the annual meeting:
| o | a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting; and | ||
| o | any material interest of the stockholder in such business; and |
as to the stockholder giving the notice:
| o | the name and record address of the stockholder; and | ||
| o | the class, series and number of shares of capital stock of the Company that are beneficially owned by the stockholder. |
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Any proposal of a stockholder intended to be presented at the Company’s 20102011 annual meeting of stockholders and included in the proxy statement and form of proxy for that meeting must be received by the Company no later than January 18, 2010.
The Company’s 20082009 Annual Report to Stockholders, which includes a copy of the Company’s Annual Report onForm 10-K for the year ended December 31, 20082009 (excluding exhibits), as filed with the Securities and Exchange Commission, is being mailed to stockholders with this proxy statement. Stockholders may also request, without charge, an additional copy of the Company’s 20082009 Annual Report to Stockholders, by writing to the Corporate Secretary, 4235 Innslake Drive, Suite 200, Glen Allen, Virginia 23060. The 20082009 Annual Report to Stockholders is not part of the proxy solicitation materials.
May 18, 2009
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 |  Community Bankers Trust Corporation |  | ||||||
VOTE BY INTERNET OR TELEPHONE QUICK««« EASY««« IMMEDIATE | ||||||||
As a stockholder of Community Bankers Trust Corporation, you have the option of voting your shares electronically through the Internet or on the telephone, eliminating the need to return the proxy card. Your electronic vote authorizes the named proxies to vote your shares in the same manner as if you marked, signed, dated and returned the proxy card. Votes submitted electronically over the Internet or by telephone must be received by 7:00 p.m., Eastern Time, on June 21, 2010. | ||||||||
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Vote Your Proxy on the Internet: Go to www.continentalstock.com. Have your proxy card available when you access the above website. Follow the prompts to vote your shares. | OR | Vote Your Proxy by Phone: Call 1 (866) 894-0537 Use any touch-tone telephone to vote your proxy. Have your proxy card available when you call. Follow the voting instructions to vote your shares. | OR | Vote Your Proxy by Mail: Mark, sign, and date your proxy card, then detach it, and return it in the postage-paid envelope provided. | ||||||||||||||||||||
PLEASE DO NOT RETURN THE PROXY CARD IF YOU ARE VOTING ELECTRONICALLY OR BY PHONE | ||||||||||||
q FOLD AND DETACH HERE AND READ THE REVERSE SIDEq | ||||||||||||
PROXY
| THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” ALL PROPOSALS | Your vote is important. Please vote immediately. | Please mark your votes like this | x | ||||||||||||||||||||||||||
1. Election of | |||||||||||||||||||||||||||||
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| 3. | |||||||||||||||||||||||||||||
| Ratification of the appointment of Elliott Davis, LLC as the Company’s independent registered public accounting firm for the | |||||||||||||||||||||||||||||
01 L. McCauley Chenault | ¨ FOR ¨ WITHHOLD | ¨ FOR¨ AGAINST¨ ABSTAIN | |||||||||||||||||||||||||||
02 Troy A. Peery, Jr. | ¨ FOR ¨ WITHHOLD | The proxy holder may vote and otherwise represent the undersigned on any other matter that may properly come before the Annual Meeting or any adjournment or postponement thereof in the discretion of the proxy holder. | |||||||||||||||||||||||||||
03 Eugene S. Putnam, Jr. | ¨ FOR ¨ WITHHOLD | ||||||||||||||||||||||||||||
Your signature is required if you are using this proxy card to vote your shares. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. If you attend the Annual Meeting in person and decide to vote by ballot, such vote will supersede this proxy. | |||||||||||||||||||||||||||||
2. Approval of a non-binding resolution to endorse the Company’s executive compensation program. ¨ FOR¨ AGAINST¨ ABSTAIN | |||||||||||||||||||||||||||||
| MARK HERE FOR ADDRESS CHANGE AND NOTE NEW ADDRESS BELOW | ¨ | ||||||||||||||||||||||||||||
COMPANY ID: | |||||||||||||||||||||||||||||
PROXY NUMBER: ACCOUNT NUMBER: | |||||||||||||||||||||||||||||
MARK HERE IF YOU PLAN TO ATTEND THE ANNUAL MEETING ¨ | |||||||||||||||||||||||||||||
Signature | Signature | Date | , 2010. | |||||||||||||
Please sign exactly as your name appears on this card. When signing as attorney, executor, administrator, trustee or guardian, please give full title. If shares are held jointly, each holder must sign. | ||||||||||||||||
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON JUNE 22, 2010: The proxy statement is available on the Company’s investor web site at http://www.cbtrustcorp.com. | ||||||||
| FOLD AND DETACH HERE AND READ THE REVERSE SIDE | |||||||
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4235 Innslake Drive, Suite 200 Glen Allen, Virginia 23060 PROXY June 22, 2010 The undersigned hereby appoints George M. Longest, Jr., Bruce E. Thomas and John M. Oakey, III, and each or any of them, as proxies, each with the powers to appoint his substitute, and hereby authorizes each to represent and to vote, as designated on the reverse side, all of the shares of common stock of Community Bankers Trust Corporation (the “Company”), held of record by the undersigned at the close of business on May 5, 2010, at the annual meeting of stockholders to be held at The Place at Innsbrook, 4036 Cox Road, Glen Allen, Virginia 23060, on Tuesday, June 22, 2010, at 10:00 a.m. local time, and at any adjournment or postponement thereof (the “Annual Meeting”), on all matters that may properly come before the Annual Meeting, including the matters described in the proxy statement, and in accordance with the instructions given by the undersigned on the reverse side of this proxy card. In the event that any other matter may properly come before the Annual Meeting, or any adjournment or postponement thereof, the proxies are each authorized to vote such matter in his discretion. The undersigned hereby revokes any proxy or proxies heretofore given and acknowledges receipt of the Notice of Annual Meeting of Stockholders and the proxy statement relating to the Annual Meeting. The shares represented by this proxy card (the “Shares”) shall be voted in accordance with the instructions given by the undersigned if the card is signed and returned.If this card is signed and returned without instructions, the Shares shall be voted in favor of all Proposals. Each of the proxies is authorized to vote the Shares in his discretion on any other matter that may properly come before the Annual Meeting. If the undersigned does not sign and return a proxy card or attend the Annual Meeting and vote by ballot, the Shares will not be voted. |
Should the undersigned be present and elect to vote at the Annual Meeting or at any adjournment thereof and after notification to the secretary of the Company at the Annual Meeting of the stockholder’s decision to terminate this proxy, then this proxy shall be deemed terminated and of no further force and effect. This proxy may also be revoked by submission of a properly executed subsequently dated proxy or by written notice to the Company for receipt prior to the Annual Meeting. (Please complete on the reverse side, date, sign and mail this proxy promptly in the enclosed postage-paid envelope.) | ||||||
