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 Section 240.14a-11(c) or Section 240.14a-12
EAGLE FINANCIAL SERVICES, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than 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)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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 Statement No.:
3) Filing Party:
4) Date Filed:
EAGLE FINANCIAL SERVICES, INC.
P. O. Box 391
Berryville, VA 22611
Notice of Annual Meeting of Stockholders
The Annual Meeting of Shareholders of Eagle Financial Services, Inc., (the
"Corporation") will be held on Wednesday, April 21, 1999, at Noon at the John H.
Enders Fire Company Social Hall, Berryville, Virginia. The purpose of the
meeting shall be as follows:
1. To elect four (4) directors for terms of three (3) years.
2. To elect two (2) directors for a term of one (1) year.
3. To consider and vote upon a proposed amendment to the Corporation's
Articles of Incorporation to increase the authorized Common Stock from 1,500,000
shares to 5,000,000 shares.
4. To transact such other business as shall properly come before the Annual
Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 19, 1999,
as the record date for determining the shareholders of the Corporation entitled
to notice of and to vote at the Annual Meeting and any adjournments thereof.
By order of the Board of Directors,
/s/ JOHN R. MILLESON
--------------------
John R. Milleson
Executive Vice President and Secretary/Treasurer
Berryville, Virginia
March 25, 1999
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. PLEASE
SIGN, DATE, AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING POSTAGE-PAID
ENVELOPE SO THAT YOUR SHARES WILL BE REPRESENTED AT THE MEETING. SHAREHOLDERS
ATTENDING THE MEETING MAY PERSONALLY VOTE ON ALL MATTERS THEN CONSIDERED, AND
ANY PROXIES PREVIOUSLY SUBMITTED BY THEM WILL BE REVOKED.
PROXY STATEMENT
OF
EAGLE FINANCIAL SERVICES, INC.
GENERAL INFORMATION
This Proxy Statement is being furnished to the shareholders of Eagle
Financial Services, Inc. (the "Corporation") in connection with the solicitation
of proxies by the Board of Directors of the Corporation to be voted at the
Annual Meeting of Shareholders to be held on April 21, 1999, at Noon at the John
H. Enders Fire Company Social Hall, Berryville, Virginia, and at any adjournment
thereof.
The cost of solicitation of proxies and preparation of proxy materials
will be borne by the Corporation. Solicitations of proxies will be made by use
of the United States mail and may be made by direct or telephone contact by
employees of the Corporation. Brokerage houses and nominees will be requested to
forward the proxy materials to the beneficial holders of the shares held of
record by these persons, and the Corporation will reimburse them for their
reasonable charges in this connection. Shares represented by duly executed
proxies in the accompanying form received by the Corporation prior to the
meeting and not subsequently revoked will be voted at the meeting. The
approximate date on which this proxy statement, the accompanying proxy card and
Annual Report to Shareholders (which is not part of the Corporation's soliciting
materials) are being mailed to the Corporation's shareholders is March 25, 1999.
The purposes of the meeting are to elect directors, vote upon a proposed
amendment to the Corporation's Articles of Incorporation to increase authorized
Common Stock and to vote on such other business, if any, that may properly come
before the meeting or any adjournment. The Corporation does not know of any
other matters that are to come before the meeting. If any other matters are
properly presented for action, the persons named in the accompanying form of
proxy will vote the proxy in accordance with their best judgment. Each
outstanding share of the Corporation's Common Stock is entitled to one vote on
all matters submitted to shareholders at the meeting. There are no cumulative
voting rights.
Where a shareholder directs in the proxy a choice with respect to any
matter that is to be voted on, that direction will be followed. If no direction
is made, proxies will be voted in favor of the election of the directors and in
the best judgment of Messrs. Jones, Gilpin and Vinson on such other business, if
any, that may properly come before the meeting or any adjournment. Any person
who has returned a proxy has the power to revoke it at any time before it is
exercised by submitting a subsequently dated proxy, by giving notice in writing
to the Secretary of the Corporation, or by voting in person at the meeting.
The close of business on March 19, 1999, has been fixed as the record date
for the meeting and any adjournment. As of that date, there were approximately
1,420,288 shares of Common Stock outstanding. As of the record date, and on the
date hereof, no person was known by the Corporation to own beneficially more
than 5% of the outstanding shares of the Corporation's Common Stock. The
directors and executive officers of the Corporation beneficially own in the
aggregate 140,611.1567 shares of the Corporation's Common Stock, representing
9.90% of the amount outstanding on the date hereof.
ELECTION OF DIRECTORS
The Board of Directors of the Corporation is structured into three classes
with one class elected each year to serve a three-year term. All nominees are
currently members of the Board. All have consented to be named and have
indicated their intent to serve if elected. Those nominees receiving the
greatest number of votes shall be deemed elected even though they may not
receive a majority. Abstentions and broker non-votes will not be considered a
vote for, or a vote against, a director. The directors who are nominated for a
three-year term at this year's meeting are Messrs. John D. Hardesty, John F.
Milleson, Jr., Lewis M. Ewing and Thomas T. Byrd. The directors who are
nominated for a one-year term at this year's meeting are Mary Bruce Glaize and
James R. Wilkins, Jr., to complete the terms vacated by the retirement of
Messrs. Garland M. Canter and Carlton L. Emmart.
1
AMENDMENT TO THE ARTICLES OF INCORPORATION of
EAGLE FINANCIAL SERVICES, INC.
TO INCREASE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK
The Board of Directors of Eagle Financial Services, Inc. (the
"Corporation") has unanimously approved, and recommends to the shareholders that
they adopt, an amendment to Article III, Section 1 of the Articles of
Incorporation that would increase the authorized Common Stock, par value $2.50
per share, from 1.5 million to 5 million shares. The amendment would not
increase the number of authorized shares of Preferred Stock, par value $10.00
per share.
Of the 1.5 million currently authorized shares of Common Stock, 1,420,288
shares were issued and oustanding as of February 15, 1999. The additional shares
of Common Stock for which authorization is sought would be a part of the
existing class of Common Stock and, if and when issued, would have the same
rights and privileges as the shares of Common Stock presently outstanding. No
holder of Common Stock has any preemptive rights. The Corporation has no plans
for the issuance of any shares of Common Stock at the present time.
Purposes and Effects
The Board of Directors believes that an increase in the number of shares
of authorized Common Stock would benefit the Corporation and its shareholders by
giving the Corporation needed flexibility in its corporate planning and in
responding to developments in the Corporation's business, including possible
acquisition transactions, stock splits or stock dividends and other general
corporate purposes. Having such authorized shares available for issuance in the
future would give the Corporation greater flexibility and allow shares of its
Common Stock to be issued without the expense and delay of a special
shareholders' meeting.
Unless otherwise required by applicable law or regulation, the shares of
Common Stock authorized will be issuable without further shareholder action and
on such terms and for such consideration as may be determined by the Board of
Directors. The Board of Directors could use the additional shares of Common
Stock to discourage an attempt to change control of the Corporation, even though
a change in control might be perceived as desirable by some shareholders, by
selling a substantial number of shares of Common Stock to persons who have an
agreement with the Corporation concerning the voting of such shares, or by
distributing Common Stock, or rights to receive such stock, to the shareholders.
The Board of Directors, however, has no present intention of issuing any shares
of Common Stock or rights to acquire Common Stock for such purposes, and there
are no arrangements with any person for the purchase of shares of Common Stock
in the event of an attempted change of control. The authorization of additional
shares of Common Stock pursuant to this proposal will have no dilutive effect
upon the proportionate voting power of the present shareholders of the
Corporation. However, to the extent that shares are subsequently issued to
persons other than the present shareholders and/or in proportions other than the
proportion that presently exists,such issuance could have a substantial dilutive
effect on present shareholders.
Vote Required
In order for it to be adopted, it must be approved by the holders of more
than two-thirds of the shares of Common Stock present or represented by properly
executed and delivered proxies at the Annual Meeting. (Abstentions and broker
shares voted as to any matter at the Annual Meeting will be included in
determining the number of shares present or represented at the Annual Meeting.
Broker shares that are not voted on any matter at the Annual Meeting will not be
included in determining the number of shares present or represented at the
Annual Meeting.)
The Board of Directors recommends that the shareholders vote in favor of
this proposal.
2
Information Concerning Directors, Nominees and Executive Officers
The following table sets forth, as of February 15, 1999, certain
information with respect to the directors, nominees for directors, and executive
officers of the Corporation.
Name, Age and Year
First Became Director or Shares of
Officer of the Corporation Principal Common Stock Percent
or previously the Occupation For Beneficially of
Bank of Clarke County Past Five Years Owned Class
- ---------------------- --------------- ------------ -------
Lewis M. Ewing President and CEO of the
Age 64 Corporation; President and CEO,
Director since 1984 CEO, Bank of Clarke County 13,188.3861 (1)(2) .93
John D. Hardesty Partner/Manager, John O.
Age 67 Hardesty & Son, a dairy farming
Director since 1963 operation; Chairman of the
Board of the Corporation,
Chairman of the Board,
Bank of Clarke County 10,640 (1) .75
Marilyn C. Beck President, Lord Fairfax
Age 59 Community College
Director since 1995 1,120 (1) .08
Thomas T. Byrd President and Publisher
Age 52 Winchester Evening Star, Inc.
Director since 1995 5,300 (3) .37
Thomas T. Gilpin President, Lenoir City Real
Age 45 Estate Investment
Director since 1986 42,890.9048 (1) 3.02
J. Fred Jones Retired Insurance Executive
Age 73
Director since 1969 12,820 (1) .90
John F. Milleson, Jr. Chairman of the Board,
Age 70 Loudoun Mutual Insurance Co.
Director since 1979 16,421 (1) 1.16
Robert W. Smalley, Jr. President and CEO, Smalley
Age 47 Package Co., Inc.
Director since 1989 5,946.9135 (1) .42
Randall G. Vinson Pharmacist, Owner Berryville
Age 52 Pharmacy
Director since 1985 10,545.2942 (1) .74
Mary Bruce Glaize Homemaker
Age 43
Director since 1998 504.1045 .03
3
Name, Age and Year
First Became Director or Shares of
Officer of the Corporation Principal Common Stock Percent
or previously the Occupation For Beneficially of
Bank of Clarke County Past Five Years Owned Class
- ---------------------- --------------- ------------ -------
James R. Wilkins, Jr. President, Wilkins'
Age 53 ShoeCenter, Inc.
Director since 1998 9,177.7757 (1) .65
John R. Milleson Executive Vice President,
Age 42 Treasurer and Secretary of
Officer since 1985 the Corporation; Executive
Vice President and Chief
Administrative Officer,
Bank of Clarke County 9,065.8506 (1)(2) .64
Daisy W. McDonald Vice President of the
Age 56 Corporation; Vice President,
Officer since 1985 Bank of Clarke County 2,405.2119 (2) .17
James W. McCarty, Jr. Vice President and Chief
Age 29 Financial Officer of the
Officer since 1995 Corporation; Vice President
and Chief Financial Officer,
Bank of Clarke County 585.7154 (1)(2) .04
Directors and executive
Officers as a group (14) 140,611.1567 9.90
- ------------------------
(1) Includes shares held jointly with spouse and/or as custodian under the
Virginia Uniform Gifts to Minors Act and/or as trustee under the terms of
certain trusts.
(2) Amounts include shares of the Corporation's Common Stock allocated to
participants and held in trust under the Bank of Clarke County Employee Stock
Ownership Plan (the "ESOP Plan") as of December 31, 1997. As of such date, the
ESOP Plan held 64,620 shares of Common Stock, or 4.55% of the total number of
such shares outstanding. Of the shares of Common Stock held in the ESOP Plan,
13,303.3688 shares were held for the accounts of executive officers. Each
participant in the ESOP Plan has the right to instruct the trustees of the ESOP
Plan with respect to the voting of shares allocated to his or her account. The
trustees, however, may use their discretion in voting any shares for which they
received no instruction.
(3) Includes shares held by Winchester Evening Star, Inc., where the director is
an executive officer of that corporation.
On December 31, 1998, there were 14 individuals in the director and
executive officer category, which includes eleven directors and four officers,
one of whom (the President) is also a director and three of whom are not
directors.
John F. Milleson, Jr., a director of the Corporation, is the father of
John R. Milleson, Executive Vice President, Treasurer and Secretary of the
Corporation, and first cousin of Daisy W. McDonald, Vice President of the
Corporation.
Board and Committee Meetings of the Corporation
During 1998, the Board of Directors of the Corporation held six
meetings. The Corporation has no standing Committees.
4
The directors of the Corporation also serve as directors of the
wholly-owned subsidiary, the Bank of Clarke County (the "Bank"). The Bank's
Board held twelve meetings in 1998, plus one planning conference. During 1998
each director attended greater than 75% of the aggregate number of meetings of
both Board of Directors and the Bank's Board committees of which he or she was a
member. The Bank's Board has established the following committees: Loan, Audit,
Personnel, Marketing and Trust. There is no nominating committee of the Board of
Directors.
The Loan Committee met twenty-six times to review the Bank's lending
practices. The committee consists of Messrs. Jones, Byrd, Smalley and Ewing.
The Personnel Committee consists of Messrs. Smalley, Ewing and Dr. Beck.
This committee met twice in 1998 to review and monitor personnel activities in
the Bank, including compensation.
The Audit Committee met three times in 1998 to review the work of the
Audit Department and to follow up on the examinations performed by the external
auditors and the regulatory authorities. This committee consisted of Messrs.
Jones, Smalley, Byrd and Dr. Beck.
The Trust Committee met fourteen times in 1998. The committee is composed
of Messrs. Gilpin, Vinson, Ewing and Milleson. The purpose of the Trust
Committee is to monitor the activities of the Trust Department of the Bank.
The Marketing Committee met four times in 1998. The committee is composed
of Messrs. Milleson, Vinson, Ewing, Wilkins and Mrs. Glaize. The committee meets
to review the activities of the Marketing Department of the Bank.
Cash Compensation
The Corporation did not pay any cash compensation to the executive
officers of the Corporation in 1998.
The following table shows the aggregate cash and cash equivalent
compensation paid by the Bank for the years ended December 31, 1998, 1997 and
1996 to the Chief Executive Officer.
SUMMARY COMPENSATION TABLE
Annual Compensation
---------------------
(e)
(a) Other Annual
Name and (b) (c) (d) Compensation
Principal Position Year Salary($) Bonus($)(1) ($)(2)
------------------ ---- -------- ---------- ------
Lewis M. Ewing, 1998 118,500 -- --
President and CEO 1997 112,000 -- --
1996 105,300 -- --
Long-Term Compensation
----------------------
Awards Payouts
------ -------
(f) (g)
Restricted Securities (h) (i)
(a) Stock Underlying LTIP All Other
Name and (b) Awards(s) Options/ Payouts Compensation
Principal Position Year ($) SARs(#) ($) ($)
------------------ ---- --- ------- --- ---
Lewis M. Ewing, 1998 -- -- -- 21,786 (3)
President and CEO 1997 -- -- -- 21,786
1996 -- -- -- 21,578
- -------------------------------
(1) The Company does not maintain a bonus plan.
(2) The aggregate of this compensation does not exceed the lesser of $50,000 or
10% of the total salary and bonus for the named executive.
(3) Includes contributions of $840 to the 401(k) Savings Plan and $20,946 to the
Executive Supplemental Income Plan.
Directors in 1998 each received $5,000 as compensation for
services as director plus a per meeting fee of $50 for each committee meeting
attended.
5
Option Grants
The Corporation does not grant options to its executive officers.
Compensation Pursuant to Plans
The Bank maintains certain plans that provide, or may provide, additional
compensation to current executive officers, directors and other employees of the
Bank. These plans include the Employee Retirement Plan, the ESOP Plan, 401-(k)
Savings Plan and the Executive Supplemental Income Plan. The Corporation does
not have any such plans for its officers, directors and employees.
Employee Retirement Plan
Effective March 1, 1953, the Bank adopted a non-contributory, tax qualified
employee retirement plan (the "Retirement Plan") for employees of the Bank who
have been employed for six months prior to any January 1 and who are at least 20
1/2 years old. The Retirement Plan was substantially amended effective March 1,
1987. Under its existing terms, benefits are based on an employee's average
compensation during his or her employment. The Retirement Plan provides for 20%
vesting upon completion of three years of service and 20% for each additional
year of service up to 100%, for early retirement at age 55 and 10 years of
vested service and for the payment of certain annuity benefits to the surviving
spouse of an employee. Because the Retirement Plan is a defined benefit plan
under which benefits vary with years of service, average annual salary and age
at retirement, the costs under the plan are not included in the foregoing cash
compensation table. The 1998 cost to the Bank under the plan represented 3.57%
of total compensation, including overtime and bonuses. Assuming that Mr. Ewing
retires at the normal retirement age of 65, it is estimated that his annual
retirement benefit will be $21,984 based on current compensation.
Employee Stock Ownership Plan
In 1987, the Bank established the ESOP Plan to provide additional
retirement benefits to substantially all employees. Contributions under the ESOP
Plan are at the Bank's discretion, and are allocated according to each
participant's compensation relative to total compensation. Vesting is the same
as for the Retirement Plan. The contributions are made to the Bank of Clarke
County Employee Retirement Trust to be used to purchase the Corporation's Common
Stock. The plan was leveraged to the extent that money was borrowed during 1995
to purchase available stock. The debt is guaranteed by the Bank.
401(k) Savings Plan
The Corporation sponsors a 401(k) savings plan under which eligible
employees may choose to save up to 15% of their salary on a pretax basis,
subject to certain IRS limits. The Corporation matches 25% (up to 6% of the
employee's salary) of employee contributions with the Corporation's Common
Stock. The shares for this purpose are provided principally by the Corporation's
employee stock ownership plan (ESOP), supplemented, as needed, by newly issued
shares. Contributions amounted to $33,175 in 1998, $8,160 in 1997 and $8,160 in
1996, including $840 in 1997, $632 in 1996 and $515 in 1995 for Mr. Ewing.
Executive Supplemental Income Plan
During 1994, the Executive Supplemental Plan was amended from the 1987
plan. Certain key employees, including Mr. Ewing, will have benefits paid in
monthly installments for 15 years following retirement or death while some
employees will be paid a lump sum of $4,000 upon retirement. The Plan provides
that if employment is terminated for reasons other than death or disability
prior to age 65, the amount of benefits would be reduced or forfeited. For Mr.
Ewing the age when the benefit begins is age 65 and his annual supplemental
salary will be $26,820. The executive supplemental income benefit expense was
$43,589 in 1998, $47,590 in 1997 and $38,499 in 1996, based on the present value
of the retirement benefits, including $20,946 for Mr. Ewing. The Plan is
unfunded. However, life insurance has been acquired on the lives of these
employees in amounts sufficient to discharge the obligations thereunder.
6
Transactions with Management
The officers, directors, their immediate families and affiliated companies
in which they are shareholders maintain normal relationships with the
Corporation and the Bank. Loans made by the Bank are made in the ordinary course
of business on the same terms, including interest rate and collateral, as those
prevailing at the time for comparable transactions with others, and do not
involve more than normal risks of collectability or present other unfavorable
features. At December 31, 1998, these persons and firms were indebted to the
Bank for loans totalling $3,696,736.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
NOMINEES SET FORTH ABOVE.
Section 16(a) Beneficial Ownership Reporting Compliance
Under Section 16(a) of the Securities Exchange Act of 1934, as amended,
directors and executive officers of the Corporation and beneficial owners of
more than 10% of the Corporation's Common Stock are required to file reports
with the Securities and Exchange Commission and the Corporation of their
beneficial ownership and changes in ownership of Common Stock.
Based solely on a review of the forms that were filed and any written
representations from reporting persons, the Corporation believes that it
complied with all the required forms.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The firm of Yount, Hyde & Barbour, P.C. has been selected by the Board of
Directors as the independent accountants for the Corporation for the year 1999.
The firm of Yount, Hyde & Barbour, P.C. has served the Corporation, and the
Bank of Clarke County prior to the establishment of the Corporation, since 1979.
The independent accountants have no direct or indirect financial interest in the
Corporation. Representatives of the firm of Yount, Hyde & Barbour, P.C. are
expected to be present at the Annual Meeting, will have the opportunity to make
a statement, if they desire to do so, and are expected to be available to
respond to appropriate questions from the shareholders.
7
SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
Under the regulations of the Securities and Exchange Commission, any
shareholder desiring to make a proposal to be acted upon at the 2000 Annual
Meeting of Shareholders must cause such proposal to be delivered, in proper
form, to the Secretary of the Corporation, whose address is 2 East Main Street,
Berryville, Virginia 22611, no later than December 1, 1999, in order for the
proposal to be considered for inclusion in the Corporation's Proxy Statement.
The Corporation anticipates holding the 2000 Annual Meeting on April 19, 2000.
The Corporation's Bylaws also prescribe the procedure a shareholder must
follow to nominate directors or to bring other business before shareholders'
meetings. For a shareholder to nominate a candidate for director or to bring
other business before a meeting, written notice must be received by the
Corporation not less than 60 days and not more than 90 days prior to the date of
the meeting. Based on an anticipated meeting date of April 19, 2000 for the 2000
Annual Meeting of Shareholders, the Corporation must receive such notice no
later than February 20, 2000 and no earlier than January 21, 2000. If
shareholders receive notice less than 70 days prior to the meeting or public
disclosure of the meeting date is made less than 70 days prior to the meeting,
written notice must be received by the Corporation not later than the close of
business on the tenth day following the day on which such notice of the date of
the annual meeting was made or such public disclosure was made.
Notice of a nomination for director must describe various matters regarding
the nominee and the shareholder giving notice. Notice of other business to be
brought before the meeting must include a description of the proposed business,
the reasons therefor, and other specific matters.
ANNUAL REPORT AND FINANCIAL STATEMENTS
THE CORPORATION'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED DECEMBER 31,
1998, INCLUDING FINANCIAL STATEMENTS, IS BEING MAILED TO SHAREHOLDERS WITH THIS
PROXY STATEMENT. A COPY OF THE CORPORATION'S ANNUAL REPORT ON FORM 10-K FOR 1998
FILED WITH THE COMMISSION, EXCLUDING EXHIBITS, MAY BE OBTAINED WITHOUT CHARGE BY
WRITING TO JOHN R. MILLESON, SECRETARY OF THE CORPORATION, WHOSE ADDRESS IS 2
EAST MAIN STREET, BERRYVILLE, VIRGINIA 22611.
OTHER MATTERS
Management is not aware of any matters to be presented for action at the
meeting other than as set forth herein. If any other matters properly come
before the meeting, or any adjournment thereof, the person or persons voting the
proxies will vote them in accordance with their best judgment.
By Order of the Board of Directors
John R. Milleson
Executive Vice President, Secretary and Treasurer
March 25, 1999
8
EAGLE FINANCIAL SERVICES, INC.
Proxy for 1999 Annual Meeting of Shareholders Solicited on behalf
of the Board of Directors
The undersigned hereby constitutes and appoints Messrs. J. Fred Jones,
Randall G. Vinson and Thomas T. Gilpin, or any one of them, attorneys and
proxies, with the power of substitution in each, to act for the undersigned
with respect to all of the Corporation's Common Stock of the undersigned at the
Annual Meeting of Shareholders to be held at the John H. Enders Fire Company
Social Hall on Wednesday, April 21, 1999, at Noon.
1. Election of Directors [ ] For all nominees listed [ ] Withhold authority to
a) For a Three (3) below (except as marked vote for all nominees
Year Term to the contrary).
John D. Hardesty, John F. Milleson, Jr., Lewis M. Ewing, Thomas T. Byrd
b) For a One (1) Year Term
Mary Bruce Glaize, James R. Wilkins, Jr.
(INSTRUCTION: To withhold authority to vote for any individual nominee, strike a
line through the nominee's name in the list above.)
2. Proposal to amend the Corporation's For Against Abstain
Articles of Incorporation to increase [ ] [ ] [ ]
the authorized Common Stock from
1,500,000 shares to 5,000,000 shares.
2. To vote in accordance with their best judgment on such other business, if
any, that may properly come before the meeting.
This proxy when properly executed will be voted in the manner directed
herein by the shareholder. If no direction is made, this proxy will be voted
for the nominees for election of directors listed in item l.
Please sign and date on the back.
Please sign your name(s) exactly as registered.
--------------------------------------------------
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, 1999
--------------------------------------------
Please date when you sign
PLEASE RETURN PROMPTLY IN THE ENCLOSED POSTAGE PAID ENVELOPE