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
YADKIN VALLEY COMPANY
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fees (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:
YADKIN VALLEY COMPANY
239 FAYETTEVILLE STREET MALL
POST OFFICE BOX 1729
RALEIGH, NORTH CAROLINA 27602
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 26, 1999
NOTICE is hereby given that the 1999 Annual Meeting of Shareholders of
Yadkin Valley Company (the "Company") will be held in the Conference Room on the
Second Floor of First-Citizens Bank & Trust Company, 239 Fayetteville Street
Mall, Raleigh, North Carolina, at 10:00 A.M., on Monday, April 26, 1999. The
purposes of the meeting are:
1. ELECTION OF DIRECTORS. To elect three members of the Board of
Directors to hold office for one-year terms or until their
respective successors are duly elected and qualified;
2. PROPOSAL TO RATIFY APPOINTMENT OF INDEPENDENT ACCOUNTANTS. To ratify
the appointment of KPMG LLP as the Company's independent public
accountants for 1999; and,
3. OTHER BUSINESS. To transact any other business which may properly
come before the meeting.
YOU ARE CORDIALLY INVITED TO ATTEND THE 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 ENVELOPE PROVIDED
FOR THAT PURPOSE TO ENSURE THAT A QUORUM IS PRESENT AT THE MEETING. THE GIVING
OF SUCH APPOINTMENT OF PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE IT OR TO
ATTEND THE MEETING AND VOTE IN PERSON.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ E. THOMAS LUCAS
E. THOMAS LUCAS
VICE PRESIDENT AND SECRETARY
MARCH 19, 1999
YADKIN VALLEY COMPANY
239 FAYETTEVILLE STREET MALL
POST OFFICE BOX 1729
RALEIGH, NORTH CAROLINA 27602
(919) 716-2266
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PROXY STATEMENT
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ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 26, 1999
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
appointments of proxy by the Board of Directors of Yadkin Valley Company (the
"Company") to be used at the Annual Meeting of Shareholders of the Company (the
"Annual Meeting") to be held in the Conference Room on the Second Floor of
First-Citizens Bank & Trust Company, 239 Fayetteville Street Mall, Raleigh,
North Carolina, at 10:00 A.M., on April 26, 1999, and at any adjournment
thereof. This Proxy Statement is being mailed to the Company's shareholders on
or about March 19, 1999.
SOLICITATION AND VOTING OF APPOINTMENTS OF PROXY
Persons named in the enclosed appointment of proxy to represent
shareholders at the Annual Meeting are David S. Perry and Jeanette C. Howell
(the "Proxies"). Shares represented by each appointment of proxy which is
properly executed, returned, and not revoked, will be voted by the Proxies in
accordance with the directions contained therein. If no directions are given,
such shares will be voted by the Proxies "FOR" the election of each of the three
nominees for director named in Proposal 1 and "FOR" Proposal 2. If, at or before
the time of the Annual Meeting, any nominee named in Proposal 1 becomes unable
or unwilling to serve for any reason, the Proxies will be authorized to vote for
a substitute nominee. On such other matters as may properly come before the
Annual Meeting, the Proxies will be authorized to vote in accordance with their
best judgment.
REVOCATION
A shareholder may revoke an appointment of proxy at any time before it
is exercised by filing with the President of the Company 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.
EXPENSES OF SOLICITATION
The Company will pay the cost of preparing, assembling, and mailing this
Proxy Statement. In addition to the use of the mails, appointments of proxy may
be solicited in person or by telephone by the Company's directors, officers, and
employees without additional compensation.
RECORD DATE
The Board of Directors has set the close of business on March 8, 1999,
as the record date ("Record Date") for the determination of shareholders
entitled to notice of and to vote at the Annual Meeting. Only shareholders of
record on the Record Date will be entitled to vote on the matters presented for
action by shareholders at the Annual Meeting.
VOTING SECURITIES
The Company's voting securities are the shares of its common stock,
$1.00 par value per share, of which 183,692 shares were issued and outstanding
as of the Record Date.
VOTING PROCEDURES; VOTES REQUIRED FOR APPROVAL
In the election of directors, the three nominees receiving the highest
number of votes will be elected. The affirmative vote of a majority of the
shares of the Company's common stock represented in person or by proxy and
voting at the Annual Meeting is required for approval of Proposal 2. 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
As of the Record Date, persons known to management of the Company to own
of record or beneficially more than 5% of the Company's outstanding voting
securities were as follows:
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENTAGE
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP (1) OF CLASS (2)
--------------------------- ---------------------- ------------
Peter M. Bristow
Columbia, South Carolina 15,374 (3) 8.37%
Hope Holding Connell
Raleigh, North Carolina 14,283 (4) 7.78%
Frank B. Holding, Jr.
Raleigh, North Carolina 19,657 (5) 10.70%
Lewis R. Holding
Lyford Cay, Bahamas 49,297 (6) 26.84%
- - ---------------
(1) Except as otherwise noted, shares shown as beneficially owned are, to
the best of management's knowledge, owned of record by the persons named
and such persons exercise sole voting and investment power with respect
to such shares.
(2) The percentage of class is based on the 183,692 shares of the Company's
common stock issued and outstanding as of the Record Date.
(3) Includes 7 shares with respect to which Mr. Bristow exercises shared
voting and investment power. Also includes an aggregate of 4,631 shares
held directly by his spouse and in a trust for her benefit and with
respect to which he disclaims beneficial ownership.
(4) Includes 101 shares with respect to which Ms. Connell exercises shared
voting and investment power. Also includes an aggregate of 9,224 shares
held directly by her spouse individually and as custodian for their
minor children and with respect to which she disclaims beneficial
ownership.
2
(5) Includes an aggregate of 1,770 shares held by certain corporations or
other entities which, for beneficial ownership purposes, may be deemed
to be controlled by Mr. Holding and with respect to which shares he may
be deemed to exercise shared voting and investment power. Also includes
4,098 shares held by his spouse and with respect to which he disclaims
beneficial ownership. Includes 1,770 shares which also are shown as
beneficially owned by Lewis R. Holding.
(6) Includes an aggregate of 2,764 shares held by certain corporations or
other entities which, for beneficial ownership purposes, may be deemed
to be controlled by Mr. Holding and with respect to which shares he may
be deemed to exercise shared voting and investment power. Also includes
1,184 shares held by his spouse and adult child individually or as
trustee and with respect to which he disclaims beneficial ownership.
Includes 1,770 shares which also are shown as beneficially owned by
Frank B. Holding, Jr.
As of the Record Date, the beneficial ownership of the Company's
outstanding voting securities by the directors individually and by directors and
executive officers as a group was as follows:
NAME OF AMOUNT AND NATURE OF PERCENTAGE
BENEFICIAL OWNER BENEFICIAL OWNERSHIP (1) OF CLASS (2)
---------------------------- --------------------------- ------------
Hope Holding Connell 14,283 (3) 7.78%
E. Thomas Lucas 4 (2)
David S. Perry 346 (4) 0.19%
All directors and executive 14,633 7.97%
officers as a group (3 persons)
- - --------------
(1) Except as otherwise noted, shares shown as beneficially owned are, to
the best of management's knowledge, owned of record by the persons named
and such persons exercise sole voting and investment power with respect
to such shares.
(2) The percentage of class is based on the 183,692 shares of the Company's
common stock issued and outstanding as of the Record Date. Percentages
less than .01% are not shown.
(3) See footnote (4) to the principal shareholders' table above for a
description of Ms. Connell's beneficial ownership of the Company's
outstanding voting securities.
(4) Includes 346 shares with respect to which Mr. Perry exercises shared
voting and investment power.
PROPOSAL 1: ELECTION OF DIRECTORS
The Company's Bylaws provide that the number of directors of the Company
shall be three. The Board of Directors has nominated the three persons named
below for election by shareholders as directors for terms of one year or until
their successors are duly elected and qualified. Each nominee currently serves
as a director of the Company.
POSITION WITH YEAR FIRST
NAME AND AGE COMPANY (1) ELECTED PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
- - -------------------- ------------- ---------- ---------------------------------------------
Hope Holding Connell Director 1998 Senior Vice President, First-Citizens
(36) Bank & Trust Company, Raleigh, NC (formerly
Vice President); Director, Southern
BancShares (N.C.), Inc. and Southern Bank
and Trust Company, Mount Olive, NC
E. Thomas Lucas Vice President, 1979 Retired; formerly President and Chief
(70) Secretary, and Executive Officer, The Heritage Bank,
Director Lucama, NC
3
POSITION WITH YEAR FIRST
NAME AND AGE COMPANY (1) ELECTED PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
- - -------------------- ------------- ---------- ---------------------------------------------
David S. Perry President, 1988 President, American Guaranty Insurance
(54) Treasurer, Company, Raleigh, NC (property and casualty
and Director insurer); President, Triangle Life
Insurance Company, Raleigh, NC (credit life
and accident and health insurer) (2)
- - ------------
(1) Ms. Connell and Messrs. Lucas and Perry also serve as directors of
Yadkin Valley Life Insurance Company, the Company's wholly-owned
subsidiary.
(2) American Guaranty Insurance Company and Triangle Life Insurance Company
are wholly-owned subsidiaries of First-Citizens Bank & Trust Company,
Raleigh, North Carolina.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" EACH OF
THE NOMINEES NAMED ABOVE. THE THREE NOMINEES RECEIVING THE HIGHEST NUMBER OF
VOTES WILL BE ELECTED.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held one meeting in 1998, which was attended by
all directors. The Board of Directors has no standing committees.
MANAGEMENT COMPENSATION
The Company's two executive officers are David S. Perry, President and
Treasurer, and E. Thomas Lucas, Vice President and Secretary. No salaries, fees,
or other compensation or benefits are paid or provided by the Company to its
executive officers or directors.
CERTAIN RELATIONSHIPS AND TRANSACTIONS
The Company and Yadkin Valley Life Insurance Company ("Yadkin Valley
Life"), the wholly-owned subsidiary of the Company, each is party to an
Administration Agreement (the "Agreement") with American Guaranty Insurance
Company, Raleigh, North Carolina ("American Guaranty"), a wholly-owned
subsidiary of First-Citizens Bank & Trust Company, Raleigh, North Carolina
("FCB"), under which American Guaranty provides 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 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 1998 was $15,165. Those fees
did not exceed 5% of the consolidated gross revenues of either the Company or
American Guaranty. 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's Board. Additionally, Frank B. Holding, Jr.,
Lewis R. Holding, and Hope Holding
4
Connell, who are principal shareholders of the Company, also are principal
shareholders of FCB's parent holding company, First Citizens BancShares, Inc.,
Raleigh, North Carolina ("BancShares"), and Messrs. F. Holding, Jr. and L.
Holding serve as directors and executive officers of FCB and BancShares.
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
wholly-owned subsidiary of FCB. Frank B. Holding, Jr., Lewis R. Holding, and
Hope Holding Connell, who are principal shareholders of the Company, also are
principal shareholders of FCB's parent holding company, BancShares, and Messrs.
F. Holding, Jr. and L. Holding also serve as directors and executive officers of
FCB and BancShares. Additionally, David S. Perry, who is President, Treasurer,
and a director of the Company, also serves as President and a director of
Triangle Life, and Frank B. Holding, Jr. serves as Chairman of the Board of
Triangle Life.
Yadkin Valley Life's business consists of reinsuring credit life
insurance policies issued by Triangle Life which 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 which are issued by Triangle Life (and which commissions are
paid from the premiums received on such 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. 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
1998 were $36,742, $49,765, and $17,019.
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 PUBLIC ACCOUNTANTS
Subject to ratification by shareholders, the Board of Directors has
appointed KPMG LLP, Certified Public Accountants, as the Company's independent
public accountants for 1999. A representative of KPMG LLP is not expected to be
present at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR"
PROPOSAL 2. THE FAVORABLE VOTE OF A MAJORITY OF THE SHARES VOTING IN PERSON OR
BY PROXY AT THE ANNUAL MEETING IS REQUIRED FOR APPROVAL.
5
OTHER MATTERS
The Board of Directors knows of no other matters that may be presented
for action at the Annual Meeting. Should other matters properly come before the
meeting, the Proxies, or their substitutes, will be authorized to vote all
shares represented by appointments of proxy in accordance with their best
judgment.
PROPOSALS OF SHAREHOLDERS
Any proposal of a shareholder which is intended to be presented for
action at the 2000 Annual Meeting must be received by the Company at its main
office in Raleigh, North Carolina, no later than November 22, 1999, to be
considered timely received for inclusion in the proxy statement and form of
appointment of proxy issued in connection with that meeting. In order for such a
proposal to be included in the Company's proxy statement and form of appointment
of proxy, the person submitting it must own, beneficially or of record, at least
1% or $1,000 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.
ADDITIONAL INFORMATION
The Company is subject to the reporting requirements of the Securities
Exchange Act of 1934 and, in accordance therewith, files reports and other
information with the Securities and Exchange Commission including, without
limitation, proxy statements, annual reports, and quarterly reports. A COPY OF
THE COMPANY'S 1998 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 1729, RALEIGH, NORTH CAROLINA 27602.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ E. THOMAS LUCAS
E. THOMAS LUCAS
VICE PRESIDENT AND SECRETARY
MARCH 19, 1999
6
YADKIN VALLEY COMPANY
239 FAYETTEVILLE STREET MALL, POST OFFICE BOX 1729
RALEIGH, NORTH CAROLINA 27602
APPOINTMENT OF PROXY
SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints David S. Perry and Jeanette C. Howell,
or either of them, attorneys and proxies (the "Proxies"), with full power of
substitution, to vote all outstanding shares of the common stock of Yadkin
Valley Company (the "Company") held of record by the undersigned on March 8,
1999, at the Annual Meeting of the Shareholders of the Company to be held on the
second floor of the offices of First-Citizens Bank & Trust Company, 239
Fayetteville Street Mall, Raleigh, North Carolina at 10:00 a.m., on April 26,
1999, and at any adjournments thereof, on the matters listed below:
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 for
(except as indicated otherwise ALL nominees listed below.
on the line below).
NOMINEES: Hope Holding Connell, David S. Perry, and E. Thomas Lucas.
INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name on the line below:
- - --------------------------------------------------------------------------------
2. RATIFICATION OF INDEPENDENT ACCOUNTANTS: Proposal to ratify the
appointment of KPMG LLP as independent public accountants for fiscal
1999.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. OTHER BUSINESS: On such other matters as may properly come before the
Annual Meeting, the Proxies are authorized to vote the shares
represented by this appointment of proxy in accordance with their best
judgement.
PLEASE DATE AND SIGN THIS APPOINTMENT OF PROXY ON THE REVERSE SIDE
AND RETURN IT TO THE COMPANY IN THE ENVELOPE PROVIDED
THE SHARES REPRESENTED BY THIS APPOINTMENT OF PROXY WILL BE VOTED IN
ACCORDANCE WITH THE SPECIFIC INSTRUCTIONS ON THE REVERSE SIDE. IN THE ABSENCE OF
ANY INSTRUCTION, THIS APPOINTMENT OF PROXY WILL BE VOTED FOR THE ELECTION OF ALL
THE NOMINEES LISTED IN PROPOSAL 1 AND FOR PROPOSAL 2. IF, AT OR BEFORE THE TIME
OF THE MEETING, ANY OF THE NOMINEES LISTED IN PROPOSAL 1 HAS BECOME UNABLE OR
UNWILLING TO SERVE AS A DIRECTOR FOR ANY REASON, THE PROXIES HAVE THE DISCRETION
TO VOTE FOR A SUBSTITUTE NOMINEE.
THIS APPOINTMENT OF PROXY MAY BE REVOKED BY THE HOLDER OF THE SHARES TO
WHICH IT RELATES AT ANY TIME BEFORE IT IS EXERCISED BY FILING A NOTICE IN
WRITING 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:_____________________________, 1999
________________________________________
SIGNATURE
____________________________________________
JOINT SIGNATURE (IF SHARES ARE HELD JOINTLY)
INSTRUCTION: Please date and sign above EXACTLY
as your name appears on this appointment of
proxy. Joint owners of shares should BOTH sign.
Fiduciaries or 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 MEETING, PLEASE SEND IN
YOUR APPOINTMENT OF PROXY WHETHER OR NOT YOU PLAN TO ATTEND. EVEN IF YOU SEND IN
YOUR APPOINTMENT OF PROXY, YOU WILL BE ABLE TO VOTE IN PERSON AT THE MEETING IF
YOU SO DESIRE.