SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
SUMMIT FINANCIAL CORPORATION
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(I)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its
filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration No.:
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(4) Date Filed:
SUMMIT FINANCIAL CORPORATION
March 21, 2003
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of
Summit Financial Corporation. The meeting will be held at Thornblade Club, 1275
Thornblade Boulevard, Greer, South Carolina on Tuesday, April 22, 2003, at 10:00
a.m.
The Notice of Annual Meeting and Proxy Statement appearing on the following
pages describe the formal business to be transacted at the meeting. During the
meeting, we will also report on the operations of the Company. Directors and
officers of the Company, as well as representatives of KPMG LLP, the Company's
independent auditors, will be present to respond to appropriate questions from
shareholders.
It is important that your shares are represented at this meeting, whether
or not you attend the meeting in person and regardless of the number of shares
you own. To make sure your shares are represented, we urge you to complete and
mail the enclosed proxy card. If you attend the meeting, you may vote in person
even if you have previously mailed a proxy card.
We look forward to seeing you at the meeting.
Sincerely,
/s/ J. Randolph Potter
J. Randolph Potter
President and Chief Executive Officer
SUMMIT FINANCIAL CORPORATION
POST OFFICE BOX 1087
937 NORTH PLEASANTBURG DRIVE
GREENVILLE, SOUTH CAROLINA 29602
(864) 242-2265
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 22, 2003
The Annual Meeting of shareholders of SUMMIT FINANCIAL CORPORATION will be
held at Thornblade Club, 1275 Thornblade Boulevard, Greer, South Carolina on
Tuesday, April 22, 2003, at 10:00 a.m. At the meeting, shareholders will
consider and vote on the following matters:
1) The election of three directors to the Board of Directors of the Company,
each for a three year term; and
2) Transaction of any other business that may properly come before the
meeting.
The Board of Directors is not aware of any other business to come before
the meeting.
Shareholders of record at the close of business on March 10, 2003 are
entitled to receive notice of the meeting and to vote at the meeting and any
adjournment or postponement of the meeting.
Please complete and sign the enclosed form of proxy, which is solicited by
the Board of Directors, and mail it promptly in the enclosed envelope. The
proxy will not be used if you attend the meeting and vote in person.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, PLEASE COMPLETE
AND RETURN THE ENCLOSED PROXY PROMPTLY IN THE ENVELOPE WHICH HAS BEEN PROVIDED
SO THAT YOUR VOTE MAY BE RECORDED.
Also enclosed is a copy of the Company's 2002 Annual Report to
Shareholders.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ J. Randolph Potter
J. RANDOLPH POTTER
PRESIDENT AND CHIEF EXECUTIVE OFFICER
March 21, 2003
Greenville, South Carolina
SUMMIT FINANCIAL CORPORATION
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 22, 2003
This Proxy Statement contains information about the 2003 Annual Meeting of
Shareholders of Summit Financial Corporation ("Summit Financial"or "the
Company"). The Annual Meeting will be held at Thornblade Club, 1275 Thornblade
Boulevard, Greer, South Carolina, on Tuesday, April 22, 2003, at 10:00 a.m. The
Company is the parent holding company for Summit National Bank ("the Bank") and
Freedom Finance, Inc. ("the Finance Company").
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of the Company to be used at the Annual
Meeting and at any adjournment of that meeting. This Proxy Statement and the
enclosed proxy card are being first mailed to shareholders on or about March 21,
2003.
VOTING AND PROXY PROCEDURE
--------------------------
WHO CAN VOTE AT THE MEETING
To be able to vote your Summit Financial common stock, the records of the
Company must have shown that you held your shares as of the close of business on
March 10, 2003, the record date for the Annual Meeting. As of the close of
business on March 10, 2003, there were 4,013,914 shares of Summit Financial
common stock issued, outstanding, and entitled to vote at the Annual Meeting.
Each share of our common stock that you owned on the record date entitles you to
one vote on each matter that is to be voted on.
ATTENDING THE MEETING
All shareholders are invited to attend the Annual Meeting. If your Summit
Financial common stock is held by a bank or brokerage firm, (i.e., in "street
name"), you will need to bring a brokerage account statement or letter from your
bank or brokerage firm showing that you are the beneficial owner of the shares
in order to be admitted to the Annual Meeting. If you want to vote your shares
of Summit Financial common stock held in street name in person at the meeting,
you will have to get a written proxy in your name from the bank or brokerage
firm which holds your shares.
WHAT CONSTITUTES A QUORUM
In order for business to be conducted at the Annual Meeting, a quorum must
be present. A quorum consists of a majority of the shares of common stock
issued, outstanding and entitled to vote at the meeting, or at least 2,006,958
shares. Shares of common stock represented in person or by proxy at the meeting
will be counted for the purpose of determining whether a quorum exists. If you
return valid proxy instructions or attend the meeting in person, your shares
will be counted for purposes of determining whether there is a quorum, even if
you abstain from voting.
Shares that reflect votes withheld for director nominees and "broker
non-votes" will be counted for purposes of determining the existence of a
quorum. "Broker non-votes" are shares that are held in "street name" by a bank
or brokerage firm that does not vote on a particular proposal because it does
not have discretionary voting power with respect to that item and has not
received voting instructions from the beneficial owner of the shares.
WHAT VOTE IS REQUIRED
Directors are elected by a plurality of the votes cast at the Annual
Meeting. This means that the three nominees receiving the greatest number of
votes cast at the meeting will be elected, regardless of whether that number
represents a majority of the votes cast. In voting on the election of
directors, you may vote in favor of all nominees, withhold votes as to all
nominees, or withhold votes as to specific nominees. There is no cumulative
voting for the election of directors. Votes that are withheld and broker
non-votes will have no effect on the outcome of the election.
HOW YOU CAN VOTE
If you own your shares of record, you can vote in one of two ways. You can
vote by mail, or you can vote in person at the meeting. You may vote by mail if
you complete, sign, and date the enclosed proxy card that accompanies this Proxy
Statement and promptly mail it in the envelope provided. You do not need to put
a stamp on the enclosed envelope if you mail it in the United States.
If your Summit Financial common stock is held in "street name", by a bank
or brokerage firm, you will receive instructions from your broker or other
nominee on how to vote your shares. Your bank or brokerage firm, as the
recordholder of your shares, is required to vote your shares according to your
instructions. In order to vote your shares, you will need to follow the
directions your bank or brokerage firm provides you. If you do not give
instructions to your bank or brokerage firm, it will still be able to vote your
shares with respect to certain "discretionary" items, but will not be allowed to
vote your shares with respect to certain "non-discretionary" items. In the case
of non-discretionary items, the shares will be treated as "broker non-votes".
Your bank or brokerage firm may allow you to deliver your voting
instructions via the telephone or the Internet. Please see the instructions
provided by your bank or brokerage firm that accompanies this proxy statement
for further information regarding telephone and Internet voting. If you wish to
change your voting instructions after your have returned your voting instruction
form to your broker or bank, you must contact your broker or bank.
VOTING BY PROXY
Your Board of Directors recommends that you vote "FOR" the election of all
nominees to serve as Directors, each for a term of three years. All shares of
Summit Financial common stock represented at the meeting by properly executed
proxies will be voted in accordance with the instructions indicated on the proxy
card. If you sign and return a proxy card without giving voting instructions,
your shares will be voted "FOR" the election of all nominees for Director.
HOW YOU CAN CHANGE YOUR VOTE
You can change your vote and revoke your proxy at any time before the vote
is taken at the meeting by doing one of the following things:
1. If you own your shares of record, you may give the Secretary of the
Company a written notice before your shares have been voted at the Annual
Meeting that you want to revoke your proxy; or
2. Sign and submit another proxy with a later date; or
3. Attend the meeting, and vote your shares in person.
Your attendance at the Annual Meeting alone will not revoke your proxy. If
your shares are held in "street name" your should follow the instructions
provided by your bank or brokerage firm.
STOCK OWNERSHIP
---------------
The following table provides information as of February 28, 2003, with
respect to persons known to the Company to be the beneficial owners of more than
5% of the Company's outstanding common stock. A person may be considered to
beneficially own any share of common stock over which he or she has, directly or
indirectly, sole or shared voting or investing power.
NUMBER OF PERCENTAGE
SHARES OF OF COMPANY
COMMON STOCK COMMON
BENEFICIALLY STOCK
NAME AND ADDRESS OWNED OUTSTANDING
- ---------------------- ------------ ------------
Ivan E. Block
210 League Road
Simpsonville, SC 29681 296,419 6.6%
The following table sets forth the names and present occupations of the
nominees for director of the Company, the directors continuing in office, and
the Company's executive officers. It also sets forth the number of shares and
percentage of outstanding shares of the Company's common stock beneficially
owned, directly or indirectly, on February 28, 2003 by the nominees, continuing
directors, and executive officers individually, and by directors and executive
officers of the Company as a group.
SHARES OF PERCENTAGE
COMMON OF
STOCK COMMON
BENEFICIALLY STOCK
NAME PRINCIPAL OCCUPATIONS; POSITIONS WITH THE COMPANY OWNED OUTSTANDING (1)
NOMINEES FOR ELECTION AS DIRECTORS
------------------------------------
FOR THREE YEAR TERMS EXPIRING IN 2006 (2)
--------------------------------------
C. Vincent Brown . . President, Brown, Massey, Evans, McLeod & Haynsworth, 194,231 4.3% (3)
Attorneys at Law, P.A.; Greenville, SC
Chairman, Summit Financial Corporation
Allen H. McIntyre. . President, ChemPro, Inc.; Spartanburg, SC 13,975 0.3%
J. Randolph Potter . President & CEO, Summit Financial Corporation; Greenville, SC 157,241 3.5% (4)
DIRECTORS CONTINUING IN OFFICE
-------------------------------
TERMS EXPIRING IN 2004
-----------------------
James G. Bagnal, III Regional President, Summit National Bank; Spartanburg, SC 41,491 0.9% (5)
Ivan E. Block. . . . Chairman & CEO, Diversified Coatings Systems, Inc.; 296,419 6.6% (6)
Greenville, SC
J. Earle Furman, Jr. President, NAI Earle Furman, LLC; Greenville, SC 90,358 2.0% (6)
T. Wayne McDonald. . Physician, Highlands Center for Women; Greenville, SC 89,755 2.0% (6)
TERMS EXPIRING IN 2005
-----------------------
John W. Houser . . . President, Piedmont Management of Fairforest, Inc.; Duncan, SC 105,810 2.4% (6)
Larry A. McKinney. . Chief Executive Officer, ElDeCo, Inc.; Greenville, SC 130,202 2.9% (6)
David C. Poole . . . President, David C. Poole Co., Inc.; Greenville, SC 189,248 4.2% (6)
Secretary, Summit Financial Corporation
James B. Schwiers. . Executive Vice President & COO, Summit National Bank; 157,659 3.5% (7)
Greenville, SC
OTHER EXECUTIVE OFFICER
------------------------
Blaise B. Bettendorf Senior Vice President & CFO, Summit Financial Corporation; 124,242 2.8% (8)
Greenville, SC
All Directors and executive officers as a group (12 persons) 1,590,631 35.5% (9)
<FN>
FOOTNOTES TO PRECEDING TABLE:
(1) - Pursuant to Rule 13d-3 under the Exchange Act, a person is deemed to
be the beneficial owner, for purposes of this table, of any shares of the
Company's common stock if he or she has voting and/or investment power with
respect to such security or has a right to acquire beneficial ownership of such
shares, through the exercise of outstanding options or otherwise, at any time
within 60 days from February 28, 2003. The table includes certain shares owned
by spouses, other immediate family members, closely-held companies, shares held
in retirement accounts for the benefit of the named individuals, and other forms
of ownership, over which shares the named persons possess sole or shared voting
and/or investment power.
(2) - Based on 4,013,914 shares of common stock of the Company outstanding
and entitled to vote at the Annual Meeting, plus the number of shares that may
be acquired within 60 days by each individual (or group of individuals) by
exercising options.
(3) - Includes exercisable options to purchase 49,642 shares of common stock
at from $3.79 - $5.08 granted under the 1995 Non-Employee Stock Option Plan.
(4) - Includes exercisable options to purchase 87,111 shares of common stock
at from $3.79 - $5.60 granted under the Incentive Stock Option Plan. Does not
include 1,701 shares held by a related party as to which Mr. Potter disclaims
beneficial ownership.
(5) - Includes exercisable options to purchase 23,153 shares of common stock
at $8.21 granted under the Incentive Stock Option Plan.
(6) - Includes exercisable options to purchase 24,822 shares of common stock
at from $3.79 - $5.08 granted under the 1995 Non-Employee Stock Option Plan.
(7) - Includes exercisable options to purchase 79,311 shares of common stock
at from $3.79 - $5.60 granted under the Incentive Stock Option Plan. (8) -
Includes exercisable options to purchase 73,240 shares of common stock at from
$3.79 - $5.60 granted under the Incentive Stock Option Plan.
(9) - Includes 461,389 shares of common stock subject to stock options
exercisable within 60 days from February 28, 2003 held by the Directors and the
executive officers of the Company as a group.
PROPOSAL 1 - ELECTION OF DIRECTORS
----------------------------------
As provided in the Company's Bylaws, the Board of Directors has fixed the
number of directors at 11. Eight of the Directors are independent and three are
members of management. The Board is divided into three classes with three-year
staggered terms, with approximately one-third of the directors elected each
year. Directors are nominated for election at the Annual Meeting to serve for a
three-year term or until their respective successors have been elected and
qualified. At the 2003 Annual Meeting, shareholders will have the opportunity
to vote for the following nominees: C. Vincent Brown, Allen H. McIntyre, and J.
Randolph Potter, all of whom are currently directors of the Company and Summit
National Bank. Each has consented to being named a nominee in this Proxy
Statement and has agreed to serve as a director if elected at the Annual
Meeting.
It is intended that the proxies solicited by the Board of Directors will be
voted for the election of the nominees named above. If any nominee is unable to
serve, the persons named in the proxy card would vote your shares to approve the
election of any substitute proposed by the Board of Directors. Alternatively,
the Board of Directors may adopt a resolution to reduce the size of the Board.
At this time, the Board of Directors knows of no reason why any nominee might be
unable to serve.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF ALL OF THE
NOMINEES.
Information regarding each nominee's and continuing director's age,
business experience, and how long each has been a director is provided below.
Unless otherwise stated, each individual has held his current occupation for at
least the last five years.
NOMINEES FOR ELECTION AS DIRECTORS FOR TERMS EXPIRING IN 2006
C. VINCENT BROWN, age 63, is an attorney and is president of Brown, Massey,
Evans, McLeod and Haynsworth, Attorneys at Law, P.A., where he has practiced tax
and corporate law for over 30 years. Mr. Brown is the Chairman of the Company
and Summit National Bank and has been a director since 1989.
ALLEN H. MCINTYRE, age 46, is president of ChemPro, Inc., a company in the
consumer packaged goods industry. He has been a director since 2000.
J. RANDOLPH POTTER, age 56, is president and chief executive officer of the
Company and its two subsidiaries, Summit National Bank, and Freedom Finance,
Inc. Mr. Potter has been a director since 1989.
DIRECTORS CONTINUING IN OFFICE WITH TERMS EXPIRING IN 2004
JAMES G. BAGNAL, III, age 58, joined Summit Financial Corporation as
regional president of Summit National Bank during 2000. He served as regional
president in Spartanburg, South Carolina for Regions Bank from 1998 to 2000 and
president of Spartanburg National Bank in Spartanburg, South Carolina prior to
1998. Mr. Bagnal has been a director since 2000.
IVAN E. BLOCK, age 57, is president and CEO of Diversified Coatings
Systems, Inc., which is engaged in the custom painting of exterior plastic parts
for the automotive industry, and president of Crown Metro Chemicals. Mr. Block
has been a director since 1989.
J. EARLE FURMAN, JR., age 55, is president of NAI Earle Furman, LLC, a
commercial and industrial real estate brokerage firm which he formed in 1986.
He has been a director since 1989.
T. WAYNE MCDONALD, age 64, is a physician specializing in gynecology. He
is currently associated with the Highlands Center for Women. Dr. McDonald has
been a director since 1989.
DIRECTORS CONTINUING IN OFFICE WITH TERMS EXPIRING IN 2005
JOHN W. HOUSER, age 59, is the president of Piedmont Management of
Fairforest, Inc., a consulting firm. He is a partner in Piedmont Brokerage and
Universal Packaging, which are involved in the manufacturing and sales of
corrugated boxes. Mr. Houser has been a director since 1989.
LARRY A. MCKINNEY, age 61, is chief executive officer of ElDeCo, Inc., an
electrical contracting firm. Mr. McKinney has been a director since 1993.
DAVID C. POOLE, age 64, is president of David C. Poole Co., Inc., a dealer
in synthetic fibers and polymers. Mr. Poole is Secretary of the Company and has
been a director since 1989.
JAMES B. SCHWIERS, age 44, is the executive vice president and chief
operating officer of Summit National Bank. He has been a director since 2000.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company and Summit National Bank conduct
their business through meetings of the Boards and through their committees.
During the year ended December 31, 2002, the Board of Directors of the Company
held four meetings and the Board of Summit National Bank held 12 meetings. In
2002, all directors of the Company attended more than 75% of the aggregate
meetings of the Board and committees on which they served during this period.
The Executive Committee of the Board of Directors, currently consisting of
Directors Brown, Poole, Potter, and Block, generally meets monthly and met 11
times during 2002. The members of the Executive Committee, exclusive of Mr.
Block, are also members of the Executive Committee of Summit National Bank and
their meetings are held jointly.
The Compensation Committee, which consisted of Directors Brown, Poole, and
McIntyre during 2002, is responsible for all matters regarding the Company's and
the Bank's employee compensation and benefit programs. The Compensation
Committee is responsible for approval of compensation arrangements of senior
management, adoption of compensation plans, and granting options or other
benefits under compensation plans. The Committee met one time during 2002.
The Board of Directors of the Company has an Audit Committee which consists
of Directors Block, Houser, McDonald and McKinney. The Audit Committee is
responsible for developing and monitoring the Company's audit program and
providing independent, objective oversight of the Company's accounting functions
and internal controls. The Committee oversees the scope of the Company's
internal audit program, the adequacy of the Company's systems of internal
controls and procedures, and the adequacy of management's action with respect to
recommendations arising from auditing activities. The Audit Committee selects
the Company's outside auditors, monitors the independence of the outside
auditors, and meets privately, outside the presence of management, with them to
discuss the results of the annual audit, quarterly reviews, internal controls
and procedures, and any related matters. The Audit Committee also oversees the
Company's regulatory compliance program. The members of the Audit Committee,
exclusive of Mr. Block, are also members of the Audit Committee of the Bank and
customarily hold joint meetings of both Committees. The Board of Directors has
determined that all of the members of the Audit Committee satisfy the
independence and other applicable requirements of the NASDAQ listing standards.
The Audit Committee met three times during the year ended December 31, 2002.
The Audit Committee's report is included later in this Proxy Statement.
The Board has no standing nominating committee. The Board of Directors of
the Company as a whole acts as a nominating committee for selecting the nominees
for recommendation to the shareholders for election as directors. The Board of
Directors met one time in its capacity as the nominating committee during the
year ended December 31, 2002. Any shareholder may recommend to the Board of
Directors persons for nomination for director by writing to the Secretary of the
Company at 937 North Pleasantburg Drive, Greenville, South Carolina, 29607.
DIRECTORS' COMPENSATION
During 2002, members of the Board of Directors of Summit Financial, who are
not officers of the Company or of its subsidiaries, received a fee of $1,050 for
each board meeting attended, and $200 for each committee meeting attended,
except for the Chairman who received two times the standard attendance fees.
Total fees paid to Directors of Summit Financial Corporation during 2002 was
$132,525. There were no stock options granted to Directors during 2002 under
the 1995 Summit Financial Corporation Non-Employee Stock Option Plan.
EXECUTIVE OFFICERS AND COMPENSATION
--------------------------------------
Set forth below are the names, ages, titles, and business experience of the
executive officers of the Company.
J. RANDOLPH POTTER, age 56, has been President and Chief Executive Officer
of the Company since 1989.
JAMES B. SCHWIERS, age 44, has been Chief Operating Officer of Summit
National Bank, a wholly-owned subsidiary of the Company (the "Bank") since 1997.
He has been Executive Vice President of the Bank since 1990.
BLAISE B. BETTENDORF, age 40, is a certified public accountant and has been
Senior Vice President and Chief Financial Officer, and Assistant
Secretary/Treasurer of the Company since 1990.
JAMES G. BAGNAL, III, age 58, has been Regional President of Summit
National Bank since joining the Company in April 2000. He served as regional
president in Spartanburg, South Carolina for Regions Bank from 1998 to 2000.
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth, for the years ended December 31, 2002, 2001
and 2000, the cash compensation paid by the Company and its subsidiaries, as
well as other compensation paid or accrued for each of these years, to the chief
executive officer and to each of the other most highly compensated executive
officers (collectively the "Named Executive Officers") for services rendered in
all capacities to the Company and its subsidiaries. All compensation, including
fringe benefits, is paid by Summit National Bank.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM COMPENSATION
--------------------------------------- --------------------------
AWARDS AWARDS
------------ ------------
OTHER RESTRICTED SECURITIES
ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND COMPEN- AWARDS($) OPTIONS/ COMPEN-
PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) (1) SATION ($) (3) SARS(#)(5) SATION ($)
- --------------------- ---- ------------ -------------- ---------- ------------ ------------ -----------
J. Randolph Potter, 2002 $ 242,000 $ 48,000 (2) - - $12,562 (6)
President/CEO 2001 $ 235,000 $ 23,000 (2) - - $ 10,861
2000 $ 222,000 $ 66,000 (2) $ 22,240 (4) - $ 10,861
James B. Schwiers,
Executive Vice 2002 $ 173,000 $ 31,000 (2) - - $11,527 (7)
President/COO 2001 $ 165,000 $ 16,000 (2) - - $ 10,961
of the Bank 2000 $ 151,000 $ 52,000 (2) $ 22,240 (4) - $ 10,961
Blaise B. Bettendorf, 2002 $ 144,000 $ 28,000 (2) - - $ 9,077 (8)
Senior Vice 2001 $ 137,000 $ 14,000 (2) - - $ 8,451
President/CFO 2000 $ 125,000 $ 37,000 (2) $ 22,240 (4) - $ 7,795
James G. Bagnal, III, 2002 $ 147,000 $ 21,000 (2) - - $ 9,677 (9)
Regional President 2001 $ 140,000 $ 14,000 (2) - - $ 9,091
of the Bank 2000 $94,000 (10) $ 30,000 (2) - 57,881 $ 2,836
<FN>
FOOTNOTES TO PRECEDING PAGE:
(1) - Reflects bonuses awarded for the current year which may be paid in the
subsequent year.
(2) - Certain amounts may have been expended by the Company which may have had value
as a personal benefit to the Named Executive Officer. However, the total value of such
perquisites and other personal benefits for any year presented did not exceed, in the
aggregate, 10% of the annual salary and bonus of such executive officer.
(3) - The value of restricted stock awards is based on the closing price of common
stock on the date of each grant, rather than the year end closing price.
(4) - In 2000, pursuant to the Company's Restricted Stock Plan, certain officers were
awarded 2,315 (adjusted for stock dividends) shares of the Company's common stock. The
awards were granted for nominal consideration and restrictions lapse 20% each year over a
period of 5 years from the date of the award. The amount and 2002 year end value (based
on the closing market price of $15.35 at December 31, 2002) of all restricted stock held
by the Named Executive Officers are: Mr. Potter held 23,757 shares of restricted stock,
of which 23,368 shares had vested, with a market value of $364,700; Mr. Schwiers held
18,396 shares of restricted stock, of which 17,007 shares had vested, with a market value
of $282,400; and, Ms. Bettendorf held 15,716 shares of restricted stock, of which 14,327
shares had vested, with a market value of $241,200. Dividends are payable on the
restricted stock to the extent paid on the Company's common stock generally. If a change
in control of the Company (as defined in the plan) were to occur, the restricted stock
would immediately vest in full.
(5) - Option grants have been adjusted for all 5% stock dividends issued.
(6) - The amount for 2002 is comprised of (i) $11,986 contributed by the Company to
the Summit Financial Corporation 401(k) Plan to match fiscal 2002 pre-tax deferral
contributions, all of which was vested; and (ii) $576 of term life insurance premiums,
not generally available to other employees, paid by the Company on behalf of Mr. Potter.
(7) - The amount for 2002 is comprised of (i) $10,951 contributed by the Company to
the Summit Financial Corporation 401(k) Plan to match fiscal 2002 pre-tax deferral
contributions, all of which was vested; and (ii) $576 in term life insurance premiums,
not generally available to other employees, paid by the Company on behalf of Mr.
Schwiers.
(8) - The amount for 2002 is comprised of (i) $8,560 contributed by the Company to
the Summit Financial Corporation 401(k) Plan to match fiscal 2002 pre-tax deferral
contributions, all of which was vested; and (ii) $518 in term life insurance premiums,
not generally available to other employees, paid by the Company on behalf of Ms.
Bettendorf.
(9) - The amount for 2002 is comprised of (i) $8,626 contributed by the Company to
the Summit Financial Corporation 401(k) Plan to match fiscal 2002 pre-tax deferral
contributions, which was partially vested; (ii) $529 in term life insurance premiums, not
generally available to other employees, paid by the Company on behalf of Mr. Bagnal; and
(iii) $522 imputed income on the term portion of split-dollar life insurance coverage
paid by the Company on behalf of Mr. Bagnal.
(10) - Mr. Bagnal joined the Company in April 2000. Compensation received by Mr.
Bagnal as reported for 2000 is related to the partial year based on an annual salary of
$130,000.
OPTION GRANT TABLE
There were no stock option grants made to any Named Executive Officer
during 2002.
OPTION EXERCISE AND FISCAL YEAR END OPTION VALUE TABLE
The following table shows stock option exercises by the Named Executive
Officers during the year ended December 31, 2002. In addition, this table
includes the number of shares (adjusted for stock dividends) covered by both
exercisable and non-exercisable options as of December 31, 2002. Also reported
are the values for "in-the-money" options, which represent the positive spread
between the exercise price of any such existing options and the year-end market
price of Summit Financial Corporation common stock.
AGGREGATED OPTION/SAR EXERCISES IN THE LAST FISCAL YEAR,
AND FISCAL YEAR-END OPTION/SAR VALUES
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
NUMBER AT FY-END (#) AT FY-END ($)
OF SHARES (2) (3) (4)
ACQUIRED $ VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED(1) UNEXERCISABLE UNEXERCISABLE
- -------------------- ----------- ------------- ---------------- --------------------
J. Randolph Potter . 200 $ 2,342 87,111 / - $905,000 / -
James B. Schwiers. . 8,000 $ 92,480 79,311 / - $815,000 / -
Blaise B. Bettendorf - - 73,240 / - $770,000 / -
James G. Bagnal, III - - 23,153 / 34,728 $165,000 / $248,000
<FN>
(1) - Value realized is calculated as the spread between the fair market value of
the underlying common stock as quoted on the NASDAQ Small Cap Market as of the exercise
date, minus the grant price.
(2) - The number of exercisable and unexercisable options has been adjusted for all
5% stock dividends issued.
(3) - Values are based on the fair market of the common stock on December 31, 2002
($15.35 as quoted on the NASDAQ Small Cap Market), minus the grant price.
(4) - The value of unexercised in-the-money stock options at December 31, 2002 is
presented to comply with SEC regulations. The actual amount realized upon any exercise
of stock options will depend upon the excess of the fair market value of the common
stock over the grant price at the time the stock option is exercised. There is no
assurance that the values of unexercised stock options reflected in this table will be
realized.
DEFINED BENEFIT PLAN
During 1998, the Company established a salary continuation plan pursuant to
agreements with certain executives of the Company and the Bank. Under the
Salary Continuation Agreements, an executive will be entitled to a stated annual
benefit for a period of 20 years either, (i) upon retirement from the Company
after attaining the normal retirement age defined in the plan as age 65, or (ii)
upon the executive's disability or death, in which case the benefits would be
payable immediately to the executive or to the executive's beneficiary. If the
executive's employment is terminated voluntarily or is terminated as a result of
a change in control of the Company as defined in the agreement, a reduced annual
benefit will be payable at the age of 65 pursuant to the early termination terms
of the agreement. Mr. Potter, Mr. Schwiers and Ms. Bettendorf have entered into
Salary Continuation Agreements with the Company that currently provide annual
benefits at age 65 of $113,200, $48,500 and $38,400, respectively.
EMPLOYEE AGREEMENTS
The Company has entered into substantially similar noncompetition,
severance, and employment agreements (each individually or "Agreement") with J.
Randolph Potter, James B. Schwiers, Blaise B. Bettendorf, and James G. Bagnal,
III (each an "Executive"). The terms of each Agreement are summarized below;
however, this summary is qualified in its entirety by reference to the Agreement
itself.
Under each Agreement, the applicable Executive is given duties and
authority typical of similar executives and the Company is obligated to pay the
Executive an annual salary determined by the Board, such incentive compensation
as may become payable to the Executive under the Company's bonus plans, and
certain other typical executive benefits. The provisions of the Agreement are
to continue until such time as the Executive's employment is terminated as
provided for in the Agreement. In the event the Executive voluntarily
terminates his employment with the Company, the Company's obligations under the
Agreement cease as of the date of such termination and the Executive is subject
to a 12 month non-competition provision as defined in the Agreement. In the
event that the Company shall terminate the Executive's employment without cause
(as defined in the Agreement), the Company is obligated to continue monthly
salary payments for a minimum period of one year up to a maximum of three years.
The Executive is subject to a non-competition provision as defined in the
Agreement for the entire period severance payments are made. In the event of
termination associated with a change in control as defined by the Agreement, the
Executive is entitled to an amount equal to three times his annual base pay
amount computed and paid over a three-year period as provided for in the
Agreement. The Executive is subject to a non-competition provision as defined
in the Agreement for a period of up to three years while he/she is receiving
payments following a change in control.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 2002, the following persons served on the Compensation Committee:
Mr. C. Vincent Brown (Chairman), Mr. John A. Kuhne (formerly Vice Chairman), Mr.
David C. Poole (Secretary), and Mr. Allen McIntyre. Mr. Brown is a member of
the law firm of Brown, Massey, Evans, McLeod, and Haynsworth, Attorneys at Law,
P.A. This firm serves as general counsel for the Company and its subsidiaries.
This firm receives payment for legal services provided in the normal course of
business.
Certain of the Directors who were members of the Compensation Committee
during 2002, and members of the immediate family and affiliates of such
Directors, have from time to time engaged in banking transactions with the
Company's subsidiary bank and are expected to continue such relationships in the
future. All loans or other extensions of credit made by the Company's
subsidiary bank to such individuals were made in the ordinary course of business
on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with unaffiliated third
parties and did not involve more than the normal risk of collectibility or
present other unfavorable features.
COMPENSATION COMMITTEE REPORT
-----------------------------
The Compensation Committee of the Board of Directors is responsible for
establishing, implementing and monitoring all compensation policies of the
Company and its primary operating subsidiary, Summit National Bank. The
Committee is also responsible for evaluating the performance of the Chief
Executive Officer of the Company and recommending appropriate compensation
levels. The Chief Executive Officer evaluates the performance of other
executive officers of the Company and recommends individual compensation levels
to the Compensation Committee for their approval.
Compensation Philosophy
- ------------------------
The Compensation Committee believes that a compensation plan for executive
officers should take into account management skills, long-term performance
results and shareholder returns. Compensation policies must be maintained to
promote: 1) the attraction and retention of highly qualified executives; 2)
motivation of executives that is related to the performance of the individual
and the Company; 3) compensation opportunities that are comparable to those
offered by peer organizations; 4) current and long-term performance; and 5) a
financial interest in the success of the Company similar to the interest of its
shareholders.
The Company's current compensation plan involves a combination of salary
and bonus to reward short-term performance; grants of stock options or
restricted stock, both of which vest over five-year periods, to encourage
long-term performance; and retirement benefits pursuant to salary continuation
agreements with certain officers. These key elements provide a competitive,
well-balanced total compensation program that is supportive of the Company's
strategies and goals.
The base salary levels and annual bonus incentives of the executive
officers are designed to be competitive within the financial services industry
and are intended to reflect individual performance and responsibility, as well
as annual corporate performance and results. Awards of stock options or
restricted stock are intended to provide executives with increased motivation
and incentive to exert their best efforts on behalf of the Company by enlarging
their personal stake in its success through the opportunity to increase their
stock ownership in the Company. The Committee believes that stock ownership by
management and stock-based performance compensation arrangements are beneficial
in aligning managements' and shareholders' interest in the enhancement of
shareholder value and focusing on long-term results. In granting stock awards
to the executive officers, the Committee takes into account the executive's
level of responsibility and the common industry practices among financial
institutions of similar size and age.
Compensation Paid in 2002
- ----------------------------
The Company's policy as to compensation of its executive officers,
including the CEO, is based upon the level of performance in relation to the
responsibilities and accomplishments incident to the individual's job
description. In determining compensation, the Committee considers the progress
made by the Company in laying a foundation for future revenue enhancements,
income improvements, growth of the Company, quality of the loan portfolio, and
growth of shareholder value.
Compensation paid J. Randolph Potter, Chief Executive Officer and President
of the Company, and the other Named Executive Officers in 2002 consisted of the
following elements: (1) a base salary; (2) a cash bonus; (3) certain
perquisites, the total of all which did not exceed 10% of base salary and bonus
amounts; (4) premiums paid by the Company on behalf of the executives with
respect to insurance not generally available to all employees; (5) vested
amounts of retirement benefits pursuant to the nonqualified salary continuation
agreement for certain officers; and (6) the other compensation set forth in the
Summary Compensation Table above.
During 2002, the Company reported record results and hit several
milestones, including total assets surpassing $300 million, which represents an
11% growth rate from the prior year. In addition, average earning assets grew
10%, and net income increased 27% to exceed $3 million. Return on average
assets and average equity both improved significantly from the prior year of
1.03% and 11.71% to 1.19% and 13.02%, respectively. The market value of the
Company's stock increased 61% to close the year at $15.35. The Company's
nonperforming assets, past due loans, and net charge-off ratios all remained low
in 2002 in comparison to peers and showed improvements from the 2001 levels as
management continues to maintain a focus on high loan quality while achieving
growth goals.
During the year 2002, the base compensation for Mr. Potter was $242,000.
For 2003, Mr. Potter's base compensation was increased 2% to $247,000. Mr.
Potter was also awarded a cash bonus (determined on a subjective basis) of
$48,000, or 20% of his salary, for the year ended 2002 based on the Company's
performance. The Committee assessed that Mr. Potter continues to provide the
Company with strong leadership in overseeing growth, asset quality,
profitability improvements, and strategic positioning for both Summit National
Bank and Freedom Finance, Inc. Growth achieved, control of overhead costs and
close monitoring to minimize loan losses and potential losses, have positioned
the Company for continued increases in the profitability measures discussed
above.
Based upon the factors discussed above, the Compensation Committee
continues to believe that Mr. Potter's compensation package as Chief Executive
Officer and President of the Company appropriately reflects the Company's
short-term and long-term performance goals.
COMPENSATION COMMITTEE:
C. Vincent Brown David C. Poole Allen H. McIntyre
STOCK PERFORMANCE GRAPH
-----------------------
The following graph compares the cumulative total shareholder return
(calculated based upon the stock appreciation) of the common stock of the
Company for the five year period from December 31, 1997 through December 31,
2002, with the cumulative total return on the NASDAQ Composite Market Index and
a peer group, the NASDAQ Bank Index, over the same period. All cumulative
returns assume an initial investment of $100 on December 31, 1997 in each of the
Company's shares, the NASDAQ Market Index, and the NASDAQ Bank Index, and the
reinvestment of all dividends.
1997 1998 1999 2000 2001 2002
------- ------- ------- ------- ------- -------
Summit Financial Corporation $100.00 $122.89 $106.91 $ 86.49 $ 98.14 $158.25
NASDAQ Bank Index. . . . . . $100.00 $ 99.36 $ 95.51 $108.95 $117.97 $120.61
NASDAQ Composite Market
Index . . . . . . . . . . . $100.00 $140.99 $261.48 $157.42 $124.89 $ 86.33
<FN>
[GRAPHIC OMITTED]
TRANSACTIONS WITH MANAGEMENT
----------------------------
Certain of the executive officers and Directors of the Company, and members
of the immediate family and affiliates of such persons, have from time to time
engaged in banking transactions with the Company's subsidiary bank and are
expected to continue such relationships in the future. All loans or other
extensions of credit made by the Company's subsidiary bank to such individuals
are regulated and limited by national banking laws. Such loans are made in the
ordinary course of business on substantially the same terms, including interest
rates and collateral, as those prevailing at the time for comparable
transactions with unaffiliated third parties and did not involve more than the
normal risk of collectibility or present other unfavorable features.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
-------------------------------------------------------
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
Directors, executive officers, and persons who own more than 10% of the
Company's common stock, to file with the Securities and Exchange Commission (the
"SEC") reports of ownership and changes in ownership of the common stock.
Directors, executive officers, and greater than 10% shareholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on its review of the copies of the reports it received and
written representations provided to the Company from the individuals required to
file the reports, the Company believes that, for the year ended December 31,
2002, each of the Company's Directors and executive officers has complied with
applicable reporting requirements for transactions in Summit Financial
Corporation common stock.
SHAREHOLDER PROPOSALS AND NOMINATIONS
-------------------------------------
In order to be considered for inclusion in the Company's Proxy Statement
and Proxy Card for its 2004 Annual Meeting of Shareholders, a shareholder
proposal must be received at the principal office of the Company, Summit
Financial Corporation, 937 North Pleasantburg Drive, Greenville, South Carolina,
29607 by November 22, 2003. Securities and Exchange Commission rules contain
standards for determining whether a shareholder proposal is required to be
included in a proxy statement.
Under the Company's bylaws, any shareholder who intends to present a
proposal, or nominate an individual to serve as a director at the 2004 Annual
Meeting, must notify the Company no later than November 22, 2003 of his
intention to present the proposal or make the nomination. The shareholder also
must comply with other requirements in the bylaws. Any shareholder may request
a copy of the relevant bylaw provision by writing to the office of the
Secretary, Summit Financial Corporation, 937 North Pleasantburg Drive,
Greenville, South Carolina, 29607.
INDEPENDENT PUBLIC ACCOUNTANTS
-------------------------------------
KPMG LLP has significant experience in bank accounting and auditing and has
served as the independent accountants of the Company since its organization in
1989. KPMG LLP has advised the Company that they are independent, within the
meaning of the rules and guidelines of the SEC, the American Institute of
Certified Public Accountants, and the Independence Standards Board.
Representatives of KPMG LLP are expected to be present at the Annual Meeting,
will be available to respond to appropriate questions, and will have the
opportunity to make a statement if they desire to do so. The Board of Directors
has selected KPMG LLP as the independent public accountants for the Company for
the year ending December 31, 2003.
AUDIT FEES - Aggregate fees paid to KPMG LLP for the audit of the Company's
annual financial statements and the related reviews of financial statements
included in the Company's Form 10-Qs for each of the years ended December 31,
2002 and 2001 totaled $38,000 and $35,000, respectively. There were no
out-of-pocket expenses incurred related to the 2002 or 2001 audit.
AUDIT-RELATED FEES - For 2002, the Company paid KPMG LLP an aggregate of $1,500
in conjunction with an S-8 registration filing.
TAX FEES - For 2002 and 2001, the Company paid KPMG LLP an aggregate of $1,500
each year for tax return preparation for a Named Executive Officer of the
Company. In addition, for 2002 tax planning engagements for the Company and a
Named Executive Officer, the Company was billed an aggregate of $5,700.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES - No fees were
billed or are expected to be billed to the Company by KPMG LLP for services
provided during the last fiscal year for the design and implementation of
financial information systems.
ALL OTHER FEES - For 2002 and 2001, the Company paid KPMG LLP an aggregate of
$1,000 each year for an FHLB collateral verification report.
The Audit Committee has considered whether the provision of services after
the audit services (as specified above) is compatible with maintaining KPMG LLP
independence and has determined that provision of such services has not
adversely effected KPMG LLP's independence.
AUDIT COMMITTEE REPORT
----------------------
The Audit Committee of the Board of Directors is responsible for, among
other things, providing independent, objective oversight of the scope of Summit
Financial's internal audit program, the independence of outside accountants,
accounting functions and the system of internal controls and procedures, and the
adequacy of management's actions with respect to recommendations arising from
those auditing activities. The Audit Committee is composed of at least three
directors, each of whom is independent under the National Association of
Securities Dealers' listing standards. The Audit Committee acts under a written
charter adopted by the Board of Directors. Additional responsibilities that are
handled by the Audit Committee are also discussed under "Meetings and Committees
of the Board of Directors" in this Proxy Statement.
The Audit Committee reviewed and discussed the audited annual financial
statements of the Company contained in the 2002 Annual Report to the SEC on Form
10-K with the Company's management and with KPMG LLP, the independent
accountants. As part of this process, management represented to the Audit
Committee that the financial statements were prepared in accordance with
accounting principles generally accepted in the United States of America. The
Audit Committee also received and reviewed written disclosures from the
accountants concerning their independence as required under applicable standards
for auditors of public companies. The Audit Committee discussed with the
accountants the contents of such materials, the accountant's independence and
the additional matters required under Statement on Auditing Standards No. 61,
"Communication With Audit Committees". Based on such review and discussion, the
Audit Committee recommended that the Board of Directors include the audited
consolidated financial statements in Summit Financial's Annual Report on Form
10-K for the year ended December 31, 2002 for filing with the Securities and
Exchange Commission.
AUDIT COMMITTEE:
Ivan E. Block John W. Houser
T. Wayne McDonald Larry A. McKinney
OTHER MATTERS
-------------
The Board of Directors and management of the Company know of no matters
other than those stated above that are to be brought before the 2003 Annual
Meeting. However, if any other matter should be presented for consideration and
voting at the 2003 Annual Meeting, it is the intention of the persons named in
the enclosed form of proxy to vote the proxy in accordance with their judgment
of what is in the best interest of the Company.
The Company will pay the cost of this proxy solicitation. The Company will
reimburse brokerage firms and other custodians, nominees and fiduciaries for
reasonable expenses incurred by them in sending proxy materials to the
beneficial owners of Summit Financial Corporation common stock. In addition to
soliciting proxies by mail, directors, officers and employees of the Company or
Summit National Bank may solicit proxies personally or by telephone. None of
these persons will receive additional compensation for these activities.
The Company's 2002 Annual Report to Shareholders is included with this
Proxy Statement and is being mailed to shareholders of record as of the close of
business on March 10, 2003. Any shareholder who has not received a copy of the
Annual Report may obtain a copy by writing to the Secretary of the Company.
Only one Annual Report and Proxy Statement may be delivered to multiple
shareholders of record located at a shared address, unless the Company has
received contrary instructions from one or more of the shareholders. The
Company will furnish, upon written or oral request, a separate copy of the
Annual Report or Proxy Statement, or both, to a shareholder of record located at
a shared address to which a single copy was sent. To request a separate copy of
the document, or to request delivery of a single copy of documents for
shareholders with a shared address, contact the Secretary of the Company at
Summit Financial Corporation, Post Office Box 1087, Greenville, South Carolina,
29602, or call the Corporate Secretary at 864-242-2265.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K, WITHOUT EXHIBITS, FOR
THE YEAR ENDED DECEMBER 31, 2002, AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, WILL BE FURNISHED WITHOUT CHARGE TO SHAREHOLDERS OF RECORD AS OF THE
CLOSE OF BUSINESS ON MARCH 10, 2003 UPON WRITTEN REQUEST TO CORPORATE SECRETARY,
SUMMIT FINANCIAL CORPORATION, POST OFFICE BOX 1087, GREENVILLE, SOUTH CAROLINA,
29602.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ J. Randolph Potter
J. RANDOLPH POTTER
PRESIDENT AND CHIEF EXECUTIVE OFFICER
March 21, 2003
Greenville, South Carolina
APPENDIX A
------------
FORM OF PROXY
--------------
SUMMIT FINANCIAL CORPORATION
POST OFFICE BOX 1087
937 NORTH PLEASANTBURG DRIVE
GREENVILLE, SOUTH CAROLINA 29602
(864) 242-2265
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS in connection with the Annual
Meeting of the shareholders of SUMMIT FINANCIAL CORPORATION (the "Company").
The undersigned hereby appoints Blaise B. Bettendorf and James B. Schwiers, or
either of them, as Proxies of the undersigned, with full power of substitution
to vote, as designated on the reverse side of this proxy, the number of shares
of common stock of the Company held of record by the undersigned on March 10,
2003 on the proposals set forth on the reverse and described in the accompanying
proxy statement at the Annual Meeting of Shareholders of the Company to be held
on Tuesday, April 22, 2003, at 10:00 a.m. at Thornblade Club, 1275 Thornblade
Boulevard, Greer, South Carolina.
THIS PROXY WILL BE VOTED AS DIRECTED. IF YOU EXECUTE AND RETURN THIS PROXY BUT
DO NOT SPECIFY OTHERWISE, THIS PROXY WILL BE VOTED FOR ALL OF THE NOMINEES
LISTED ON THE REVERSE, AND, IN THE PROXIES' DISCRETION, ON ANY OTHER MATTER THAT
MAY PROPERLY COME BEFORE THE MEETING. THIS PROXY IS REVOCABLE PRIOR TO ITS
EXERCISE.
(CONTINUED AND TO BE SIGNED ON THE OTHER SIDE)
Please date, sign and mail your
proxy card back as soon as possible!
Annual Meeting of Shareholders
SUMMIT FINANCIAL CORPORATION
April 22, 2003
Please date, sign and mail your proxy card
in the envelope provided as soon as possible
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN.
1. To elect three directors to the Board of Directors for three-year terms
and thereafter until their successors are duly elected and qualified.
FOR ALL NOMINEES ______
WITHHOLD AUTHORITY FOR ALL NOMINEES _______
FOR ALL EXCEPT (see instructions below) __________
INSTRUCTIONS: To withhold authority to vote for any individual nominee(s),
mark "FOR ALL EXCEPT" and fill in the circle next to each nominee you wish
to withhold, as shown.
NOMINEES:
___ C. VINCENT BROWN
___ ALLEN H. MCINTYRE
___ J. RANDOLPH POTTER
2. To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
Only those holders of record of the Common Stock of the Company at the close of
business on March 10, 2003 are entitled to notice of and to vote at the Annual
Meeting or any adjournment thereof.
A Proxy Statement is enclosed herewith. Please sign, date and return this Proxy
promptly in the enclosed envelope. IF YOU ATTEND THE MEETING YOU MAY, IF YOU
WISH, WITHDRAW YOUR PROXY AND VOTE IN PERSON.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS
SIGNATURE OF SHAREHOLDER _____________________________ DATE_________
SIGNATURE OF SHAREHOLDER ____________________________ DATE__________
NOTE: This proxy must be signed exactly as the name appears hereon.
When shares are held jointly, each holder should each 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.