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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
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 (S) 240.14a-11(c) or (S) 240.14a-12
Yadkin Valley Company
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(Name of Registrant as Specified In Its Charter)
Not Applicable
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(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
YADKIN VALLEY COMPANY
343 East Six Forks Road
Post Office Box 18747
Raleigh, North Carolina 27619
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
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The Annual Meeting of Shareholders of Yadkin Valley Company (the "Company")
will be held at 10:00 a.m. on Monday, April 23, 2001, at 343 East Six Forks Road
(Third Floor Conference Room), Raleigh, North Carolina.
The purposes of the meeting are:
1. Election of Directors. To elect three directors of the Company for
terms of one year or until their respective successors are duly
elected and qualified;
2. Proposal to Ratify Appointment of Independent Accountants. To consider
a proposal to ratify the appointment of KPMG LLP as the Company's
independent public accountants for 2001; and,
3. Other Business. To transact any other business properly presented for
action at the meeting.
You are invited to attend the Annual Meeting in person. However, even if
you plan to attend, you are requested to complete, sign and date the enclosed
appointment of proxy and return it promptly in the accompanying envelope to
ensure that a quorum is present at the Annual Meeting. Signing an appointment
of proxy will not affect your right to revoke it and to attend the Annual
Meeting and vote in person.
By Order of the Board of Directors
E. Thomas Lucas
Vice President and Secretary
March 28, 2001
YADKIN VALLEY COMPANY
343 East Six Forks Road
Post Office Box 18747
Raleigh, North Carolina 27619
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PROXY STATEMENT
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ANNUAL MEETING OF SHAREHOLDERS
General
This Proxy Statement is being furnished to shareholders of Yadkin Valley
Company (the "Company") in connection with the solicitation by the Company's
Board of Directors of appointments of proxy in the enclosed form for use at the
Annual Meeting of the Company's shareholders (the "Annual Meeting") and at any
adjournments of the meeting. The Annual Meeting will be held at 343 East Six
Forks Road (Third Floor Conference Room), Raleigh, North Carolina, at 10:00 a.m.
on Monday, April 23, 2001. This proxy statement is being mailed to the
Company's shareholders on or about March 28, 2001.
Appointment and Voting of Proxies
A form of appointment of proxy is included with this Proxy Statement which
names David S. Perry and Jeanette C. Howell (the "Proxies") to act as proxies
and represent shareholders at the Annual Meeting. The Board of Directors
requests that shareholders sign and date an appointment of proxy and return it
to the Company in the enclosed envelope.
Shares of the Company's common stock held of record by a shareholder who
correctly executes an appointment of proxy and returns it to the Company before
the Annual Meeting will be voted by the Proxies according to the shareholder's
directions. If no directions are given by the shareholder in the appointment of
proxy, then those shares will be voted by the Proxies "FOR" the election of each
of the three nominees for director named in Proposal 1 below, and "FOR" Proposal
2. If, at or before the time of the Annual Meeting, any nominee named in
Proposal 1 becomes unavailable or unwilling to serve as a director for any
reason, the Proxies will have the discretion to vote for a substitute nominee
named by the Board of Directors. The Board of Directors is not aware of any
other business that will be brought before the Annual Meeting but, if any other
matter is properly presented for action by shareholders, the Proxies will be
authorized to vote shares represented by appointments of proxy according to
their best judgment.
The Company will pay all costs of this solicitation of appointments of
proxy for the Annual Meeting, including costs of preparing and mailing this
Proxy Statement. In addition to solicitation by mail, appointments of proxy may
be solicited personally or by telephone by officers, employees and directors of
the Company without additional compensation.
Revocation of Appointment of Proxy
A shareholder who executes an appointment of proxy can revoke it at any
time before the voting takes place at the Annual Meeting by filing with the
Company's Secretary either a written instrument revoking it or an executed
appointment of proxy dated as of a later date, or by attending the Annual
Meeting and announcing an intention to vote in person.
Record Date
The Company's Board of Directors has set the close of business on March 9,
2001, as the record date (the "Record Date") for determining which shareholders
are entitled to receive notice of and to vote at the Annual Meeting. A person
must be a shareholder of record on the Record Date in order to be
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eligible to vote at the Annual Meeting.
Voting Securities
The Company's voting securities are the outstanding shares of its common
stock, $1 par value ("Common Stock"), of which 183,154 shares were outstanding
on the Record Date. At the Annual Meeting, a shareholder may cast one vote for
each share held of record on the Record Date on each director to be elected and
on each other matter voted on by shareholders.
Voting Procedures; Votes Required for Approval
In the election of directors, the three candidates receiving the highest
numbers of votes will be elected. For Proposal 2 to be approved, the number of
votes cast in person and by proxy at the Annual Meeting in favor of that
proposal must exceed the number of votes cast against it. As long as a quorum
is present, abstentions and broker non-votes will have no effect in the voting
at the Annual Meeting. Shareholders may not vote cumulatively in the election of
directors.
Beneficial Ownership of Securities
Principal Shareholders. As of the Record Date, persons listed in the
following table were known to the Company to own beneficially or of record 5% or
more of the Company's outstanding Common Stock.
Name and Address Amount and Nature of Percentage
of Beneficial Owner Beneficial Ownership (1) of Class
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Peter M. Bristow
Columbia, South Carolina 15,529 (2) 8.48%
Hope Holding Connell
Raleigh, North Carolina 14,319 (3) 7.82%
Frank B. Holding, Jr.
Raleigh, North Carolina 19,657 (4) 10.73%
Lewis R. Holding
Lyford Cay, Bahamas 49,927 (5) 27.26%
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(1) Except as otherwise noted, to the Company's knowledge, each named
individual exercises sole voting and investment power with respect to all
shares.
(2) Includes an aggregate of 4,786 shares held by or in trust for Mr. Bristow's
spouse and with respect to which shares he disclaims beneficial ownership.
(3) Includes 101 shares held in trust for Ms. Connell and with respect to which
shares she exercises shared voting and investment power, and an aggregate
of 10,918 shares held by her spouse and with respect to which shares she
disclaims beneficial ownership.
(4) Includes an aggregate of 1,770 shares held by certain corporations or other
entities which Mr. Holding may be deemed to control and with respect to
which shares he may be deemed to exercise shared voting and investment
power, 101 shares held in trust for Mr. Holding with respect to which he
exercises shared voting and investment power, and 4,098 shares held by his
spouse and with respect to which shares he disclaims beneficial ownership.
Of the listed shares, 1,770 shares also are included in the shares shown as
beneficially owned by Lewis R. Holding.
(5) Includes an aggregate of 2,764 shares held by certain corporations or other
entities which Mr. Holding may be deemed to control and with respect to
which shares he may be deemed to exercise shared voting and investment
power, and 1,814 shares held by or in trust for his spouse and adult
daughter and with respect to which shares he disclaims beneficial
ownership. Of the listed shares, 1,770 shares also are included in the
shares shown as beneficially owned by Frank B. Holding, Jr.
Management. The following table describes the beneficial ownership of the
Company's Common Stock as of the Record Date by its current directors
individually and by all directors and officers as a group.
Name of Amount and Nature of Percentage
Beneficial Owner Beneficial Ownership (1) of Class (1)
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Hope Holding Connell 14,319 (2) 7.82%
2
E. Thomas Lucas 4 *
David S. Perry 379 (3) 0.21%
All directors and executive
officers as a group (3 persons) 14,702 8.03%
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(1) Except as otherwise noted, to the Company's knowledge, the individuals
named and included in the group exercise sole voting and investment power
with respect to all shares. An asterisk indicates less than .01%.
(2) Ms. Connell's beneficial ownership is described in footnote 3 to the
Principal Shareholders' table above.
(3) Mr. Perry exercises shared voting and investment power with respect to all
shares.
Section 16(a) Beneficial Ownership Reporting Compliance
The Company's directors and executive officers are required by federal law
to file reports with the Securities and Exchange Commission regarding the amount
of and changes in their beneficial ownership of the Company's Common Stock.
Based on its review of copies of those reports, the Company's proxy materials
are required to disclose failures to report shares beneficially owned or changes
in beneficial ownership, or to timely file required reports, during the previous
year. To the knowledge of management of the Company, all such reports required
to be filed during 2000 have been timely filed.
PROPOSAL 1: ELECTION OF DIRECTORS
The Company's Bylaws provide for a Board of Directors composed of three
members who are elected each year at the Annual Meeting for terms of one year or
until their respective successors have been duly elected and qualified. The
Board of Directors has nominated the three current directors named below for
reelection by shareholders at the Annual Meeting.
Position with First
Name and Age Company (1) Elected Principal Occupation and Business Experience
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Hope Holding Connell Director 1998 Group Vice President, First-Citizens Bank & Trust
(38) Company, Raleigh, NC; Director, Southern BancShares
(N.C.), Inc. and Southern Bank and Trust Company,
Mount Olive, NC
E. Thomas Lucas Vice President, 1979 Retired; until 1994, served as President and Chief
(72) Secretary and Director Executive Officer, The Heritage Bank, Lucama, NC
David S. Perry President, Treasurer 1988 Executive officer and director of the Company;
(56) and Director President and director, American Guaranty Insurance
Company, Raleigh, NC (property and casualty insurer);
President and director, Triangle Life Insurance Company,
Raleigh, NC (credit life and accident and health insurer)
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(1) Each director also serves as a director of the Company's subsidiary, Yadkin
Valley Life Insurance Company.
The Board of Directors recommends that shareholders vote "FOR" each of the
three nominees named above. The three nominees receiving the highest numbers of
votes will be elected.
Meetings and Committees of the Board of Directors
The Board of Directors held one meeting in 2000, which was attended by all
directors. Because it only has three members, the Board of Directors does not
have an audit, compensation or nominating committee.
Report of the Board of Directors on Audit Matters
The Board of Directors has (i) reviewed the Company's audited consolidated
financial statements for 2000 and discussed them with management, (ii) discussed
with the Company's independent accountants the matters required to be discussed
by Statement on Auditing Standards No. 61, as amended, (iii) received written
disclosures and a letter from the Company's independent accountants required by
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Independence Standards Board Standard No. 1, and (iv) discussed the independence
of the Company's accountants with the accountants. Based on the above review
and discussions, the Board of Directors approved inclusion of the audited
consolidated financial statements in the Company's 2000 Annual Report on Form
10-KSB as filed with the Securities and Exchange Commission.
The Board of Directors:
Hope Holding Connell E. Thomas Lucas David S. Perry
Director Compensation
The Company's directors receive no fees or other compensation for their
services as directors.
Executive Officers
The Company's two executive officers are as follows:
David S. Perry, age 56, has served as President and Treasurer of the
Company since 1988, and as President and Treasurer of its subsidiary, Yadkin
Valley Life Insurance Company, since 1998. He also serves as President of
American Guaranty Insurance Company, Raleigh, North Carolina, a property and
casualty insurer, and as President of Triangle Life Insurance Company, Raleigh,
North Carolina, a credit life and accident and health insurer. American
Guaranty Insurance Company is a subsidiary corporation of First Citizens
BancShares, Inc., and Triangle Life Insurance Company is a subsidiary
corporation of First-Citizens Bank & Trust Company. (See "Certain Relationships
and Transactions.")
E. Thomas Lucas, age 72, has served as Vice President and Secretary of the
Company and its subsidiary, Yadkin Valley Life Insurance Company, since 1989.
Until his retirement in 1994, Mr. Lucas served as President and Chief Executive
Officer of The Heritage Bank, Lucama, North Carolina.
Executive Compensation
The Company has no employees, and its executive officers receive no
salaries or other compensation or benefits for their services as officers. (See
"Certain Relationships and Transactions.")
Certain Relationships and Transactions
The Company and its subsidiary, Yadkin Valley Life Insurance Company
("Yadkin Valley Life"), each is party to an Administration Agreement (the
"Agreements") with American Guaranty Insurance Company, Raleigh, North Carolina
("American Guaranty"), a subsidiary of First Citizens BancShares, Inc., Raleigh,
North Carolina ("BancShares"). Under the Agreements, American Guaranty provides
the managerial, administrative and operational services necessary in carrying on
the insurance holding company business and reinsurance business of the Company
and Yadkin Valley Life, respectively, subject to the supervision and control of
the Company's Board of Directors. American Guaranty is compensated and
reimbursed for services rendered and expenses incurred which are reasonable and
properly attributable, directly or indirectly, to the management and conduct of
the Company's and Yadkin Valley Life's business affairs. The Agreements may be
terminated by either party at any time upon written notice to the other.
Aggregate fees paid by the Company and Yadkin Valley Life to American Guaranty
pursuant to the Agreements during 2000 were $16,483. David S. Perry, who is
President, Treasurer and a director of the Company, also serves as President and
a director of American Guaranty, and Frank B. Holding, Jr., a principal
shareholder of the Company, serves as Chairman of American Guaranty. It is
expected that American Guaranty will continue to provide services to the Company
and Yadkin Valley Life under the Agreements during 2001.
The Company's reinsurance business consists solely of assuming risks,
through Yadkin Valley Life, on credit life insurance policies issued by Triangle
Life Insurance Company, Raleigh, North Carolina ("Triangle Life"), which is a
subsidiary of First-Citizens Bank & Trust Company, Raleigh, North Carolina
("FCB"). David S. Perry, who is President, Treasurer and a director of the
Company, also serves
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as President and a director of Triangle Life, and Frank B. Holding, Jr., a
principal shareholder of the Company, serves as Chairman of Triangle Life.
As noted above, American Guaranty is a subsidiary of BancShares and
Triangle Life is a subsidiary of FCB. Frank B. Holding, Jr., Lewis R. Holding
and Hope H. Connell, who are principal shareholders of the Company, also are
principal shareholders of FCB's parent holding company, BancShares. Also, Frank
B. Holding, Jr. and Lewis R. Holding serve as directors and executive officers
of FCB and BancShares, and Hope H. Connell serves as a senior officer of FCB.
The credit life insurance policies issued by Triangle Life and reinsured by
Yadkin Valley Life are sold through Southern Bank and Trust Company, Mount
Olive, North Carolina ("Southern"), The Fidelity Bank, Fuquay-Varina, North
Carolina ("Fidelity"), and The Heritage Bank, Lucama, North Carolina
("Heritage"). Each of those banks has an arrangement with Triangle Life whereby
it receives a commission on credit life insurance policies it sells to its loan
customers (and which commissions are paid from the premiums received on those
policies). Hope H. Connell, who is a director and principal shareholder of the
Company, also serves as a director of Southern and its parent holding company
and is a principal shareholder of Heritage's parent holding company. Frank B.
Holding, Jr., a principal shareholder of the Company, also is a principal
shareholder of Southern's parent holding company. Lewis R. Holding, a principal
shareholder of the Company, also is a principal shareholder of Southern's and
Fidelity's parent holding companies. E. Thomas Lucas, an executive officer and
a director of the Company, also is a director of Heritage. The dollar amounts
of commissions received by Southern, Fidelity and Heritage, respectively, in
connection with those policies during 2000 were $29,712, $42,466, and $13,776.
A significant portion of the Company's assets are represented by its
investments in equity securities of BancShares, First Citizens Bancorporation of
South Carolina, Columbia, South Carolina ("Bancorporation"), and Heritage. The
Company is affiliated with BancShares and Heritage as a result of the common
control relationships described above. Additionally, Lewis R. Holding, a
principal shareholder of the Company, also is a principal shareholder of
Bancorporation, and Peter M. Bristow, a principal shareholder of the Company,
also is a principal shareholder and an executive officer of Bancorporation.
PROPOSAL 2: RATIFICATION OF INDEPENDENT ACCOUNTANTS
Appointment of Independent Accountants
The Company's current independent certified public accounting firm, KPMG
LLP, has been reappointed by the Board of Directors to serve as the Company's
independent accountants for 2001, and a proposal to ratify that appointment will
be submitted for voting by shareholders at the Annual Meeting. Representatives
of KPMG LLP are not expected to attend the Annual Meeting.
The Board of Directors recommends that shareholders vote "FOR" Proposal 2.
To be approved, the number of votes cast in person and by proxy at the Annual
Meeting in favor of the proposal must exceed the number of votes cast against
it.
Services and Fees During 2000
As the Company's independent accountants for 2000, KPMG LLP provided
various audit and non-audit services for which the Company and Yadkin Valley
Life were billed for fees as further described below. The Company's Board of
Directors has considered whether KPMG LLP's provision of non-audit services is
compatible with maintaining its independence.
Audit Fees. KPMG LLP audited the Company's consolidated financial
statements included in its 2000 Annual Report on Form 10-KSB and, during 2000,
it reviewed the financial statements included in the Company's Quarterly Reports
on Form 10-QSB. The aggregate amount of fees billed to the Company for those
services was $17,350.
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Financial Information Systems Design and Implementation Fees. During 2000,
KPMG LLP provided no services relating to financial information systems design
and implementation.
All Other Fees. In addition to the services listed above, during 2000,
KPMG LLP provided certain other services for which the aggregate amount of fees
billed to the Company and Yadkin Valley Life was $5,250.
SHAREHOLDER PROPOSALS
Any proposal of a shareholder which is intended to be presented for action
at the 2002 Annual Meeting must be received by the Company in writing at its
main office in Raleigh, North Carolina, no later than November 28, 2001, to be
considered timely received for inclusion in the proxy statement and form of
appointment of proxy distributed by the Company in connection with that meeting.
In order for a proposal to be included in the Company's proxy materials for a
particular meeting, the person submitting the proposal must own, beneficially or
of record, at least 1% or $2,000 in market value of shares of the Company's
Common Stock entitled to be voted on that proposal at the meeting and must have
held those shares for a period of at least one year and continue to hold them
through the date of the meeting. Also, the proposal and the shareholder
submitting it must comply with certain other eligibility and procedural
requirements contained in rules of the Securities and Exchange Commission.
Written notice of a shareholder proposal intended to be presented at the
2002 Annual Meeting, but which is not intended to be included in the Company's
proxy statement and form of appointment of proxy, must be received by the
Company at its main office in Raleigh, North Carolina, no later than February
11, 2002, in order for that proposal to be considered timely received for
purposes of the Proxies' discretionary authority to vote on other matters
presented for action by shareholders at that meeting.
ADDITIONAL INFORMATION
The Company is subject to the reporting requirements of the Securities
Exchange Act of 1934 and files reports and other information, including proxy
statements, annual reports and quarterly reports, with the Securities and
Exchange Commission.
A copy of the Company's 2000 Annual Report on Form 10-KSB as filed with the
Securities and Exchange Commission will be provided without charge upon the
written request of any shareholder entitled to vote at the Annual Meeting.
Requests for copies should be directed to David S. Perry, President, Yadkin
Valley Company, Post Office Box 18747, Raleigh, North Carolina 27619 (Telephone
919-716-2266).
March 28, 2001
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YADKIN VALLEY COMPANY
343 East Six Forks Road
Post Office Box 18747
Raleigh, North Carolina 27619
APPOINTMENT OF PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints David S. Perry and Jeanette C. Howell (the
"Proxies"), and any substitute appointed by them, as the undersigned's attorneys
and proxies, and authorizes each of them, jointly and severally, to represent
and vote as directed below all shares of the common stock of Yadkin Valley
Company (the "Company") held of record by the undersigned on March 9, 2001, at
the Annual Meeting of Shareholders of the Company to be held at 343 East Six
Forks Road (Third Floor Conference Room), Raleigh, North Carolina, at 10:00 a.m.
on April 23, 2001, and at any adjournments of the meeting. The undersigned
hereby directs that the shares represented by this appointment of proxy be voted
as follows:
1. ELECTION OF DIRECTORS: Proposal to elect three directors of the Company
for one-year terms or until their successors are duly elected and
qualified.
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote
(except as indicated otherwise on for ALL nominees listed below.
the line below).
Nominees: Hope Holding Connell, E. Thomas Lucas, and David S. Perry.
Instruction: To withhold authority to vote for any individual nominee,
write that nominee's name on the line below:
2. PROPOSAL TO RATIFY APPOINTMENT OF INDEPENDENT ACCOUNTANTS: Proposal to
ratify the appointment of KPMG LLP as the Company's independent accountants
for 2001.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. OTHER BUSINESS: On such other matters as may properly be presented for
action at the Annual Meeting, the Proxies are authorized to vote the shares
represented by this appointment of proxy in accordance with their best
judgement.
The shares represented by this appointment of proxy will be voted as
directed above. In the absence of any direction, the Proxies will vote the
shares represented by this appointment of proxy "FOR" the election of each
nominee named in Proposal 1 and "FOR" Proposal 2. If, at or before the time of
the meeting, any nominee listed in Proposal 1 has become unavailable or
unwilling to serve as a director for any reason, the Proxies are authorized to
vote for a substitute nominee named by the Board of Directors. This appointment
of proxy may be revoked at any time before it is exercised by filing with the
Company's Secretary a written instrument revoking it or a duly executed
appointment of proxy bearing a later date, or by attending the Annual Meeting
and announcing his or her intention to vote in person.
Dated: __________________, 2001
____________________________________________
Signature
____________________________________________
Joint Signature (if shares are held jointly)
Instruction: Please and sign above exactly as your name appears on this
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appointment of proxy. Joint owners of shares should both sign. Fiduciaries or
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other persons signing in a representative capacity should indicate the capacity
in which they are signing.
IMPORTANT: To ensure that a quorum is present at the Annual Meeting, please
send in your appointment of proxy whether or not you plan to attend. Even if
you return a signed appointment of proxy, you will be able to revoke it and vote
in person at the Annual Meeting if you so desire.