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
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Check the appropriate box:
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14A-6(E)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Sec. 240.14a-12
MIMBRES VALLEY FARMERS ASSOCIATION, INC.
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(Name of Registrant as Specified In Its Charter)
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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.
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MIMBRES VALLEY FARMERS ASSOCIATION, INC.
811 South Platinum
Deming, New Mexico 88030
(505) 546-2769
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NOTICE
of Annual Meeting of Shareholders
To Be Held On November 22, 2002
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To the Shareholders:
The 2002 Annual Meeting of Shareholders of Mimbres Valley Farmers
Association, Inc., a New Mexico Corporation (the "Company") will be held on
November 22, 2002 at 10 a.m. at 811 S. Platinum, Deming, New Mexico, for the
following purposes:
1) To elect seven (7) Directors;
2) To approve The Accounting and Consulting Group, L.L.P., of
Carlsbad, New Mexico as the Company's independent auditors;
3) To adopt an amendment to the Articles of Incorporation of the
Company and Restated Articles of Incorporation of the Company; and
4) To transact such other business as may properly come before the
Annual Meeting or any adjournment thereof, including proposals to adjourn
from time to time. Management is not currently aware of any other business
to come before the Annual Meeting.
Holders of Common Stock of record at the close of business on October 18,
2002 are entitled to receive notice of and to vote at the Annual Meeting or any
adjournment thereof. Shares of Common Stock can be voted at the Annual Meeting
only if the holder is present in person or by valid proxy.
The officers and directors of the Company cordially invite you to attend
the Annual Meeting. Directions to 811 S. Platinum may be obtained by calling
(505) 546 2769. Even if you plan to attend the Meeting in person, you are
requested to complete, date and sign the enclosed form of proxy and return it
promptly in the envelope provided so that your shares may be voted in accordance
with your wishes. If you attend the meeting, you may vote your shares in person,
even though you have previously signed and returned your proxy. Please direct
your attention to the attached Proxy Statement.
By Order of the Board of Directors
Shelby Phillips, III, Chairman
Deming, New Mexico
October 25, 2002
Attachments: (1) Proxy Statement
(2) Proxy
(3) Annual Report on Form 10-KSB
YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN.
PLEASE MARK, DATE, SIGN AND MAIL YOUR ENCLOSED PROXY PROMPTLY.
TO HELP US UPDATE OUR INFORMATION, WE NEED
YOUR CURRENT ADDRESS AND PHONE NUMBER.
MIMBRES VALLEY FARMERS ASSOCIATION, INC.
811 South Platinum
Deming, New Mexico 88030
(505) 546-2769
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PROXY STATEMENT
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INTRODUCTION
The Board of Directors (the "Board") of Mimbres Valley Farmers Association,
Inc., a New Mexico Corporation (the "Company"), is furnishing you this Proxy
Statement and soliciting your proxy in connection with the Annual Meeting of
Shareholders to be held at 811 S. Platinum, Deming, New Mexico 88030, on
November 22, 2002, at 10:00 a.m. or at any adjournments thereof, for the
purposes stated in the enclosed Notice of Annual Meeting (the "Notice"). The
Company is mailing the proxy materials on or about October 25, 2002 to holders
of shares of Common Stock of the Company of record at the close of business on
October 18, 2002, (the "Record Date").
At the close of business on the Record Date, the Company had 13,781.47
shares of Common Stock outstanding. The Company does not know of any person who
owns 5% or more of the Common Stock as of the Record Date.
To simplify the language in this document, the "Company" means Mimbres
Valley Farmers Association, Inc., and "you" means the Stockholder, and the
person or entity that signs the Proxy.
The Company will bear the cost of soliciting the proxies. In addition to
the use of the mail, the Company's officers and directors or their
representatives may solicit proxies by personal interview, telephone or
telegraph. The Company has no plans or arrangements to use a paid proxy
solicitor in connection with the solicitation of proxies.
VOTING AND VOTE REQUIRED
Each share of Common Stock outstanding at the Record Date is entitled to
one vote on each matter of business to be considered at the Annual Meeting. In
accordance with the Company's Bylaws, the presence, either in person or by
properly executed proxy, of the holders of record of thirty-three and one-third
per cent (33 and 1/3%) of the voting power of the issued and outstanding Common
Stock who are entitled to vote, will constitute a quorum at the Annual Meeting.
If you properly sign and return the enclosed proxy to the Company in time
to be voted at the Annual Meeting, your shares will be voted as you specify on
the proxy, unless you properly revoke the proxy prior to or at the beginning of
the Annual Meeting as described below. If you do not make any specification in
your proxy as to any one or more of the proposals, the shares represented by
your proxy will be voted for the election of the nominees for directors named
below, for the approval and ratification of the appointment of the independent
auditors, for the adoption of the charter amendment described below, and, with
respect to any other matters that may come before the Annual Meeting, at the
discretion of the proxy holders.
You may revoke your proxy at any time prior to its exercise by (i)
attending the Annual Meeting and voting in person, (ii) duly executing and
delivering a proxy bearing a later date, or (iii) sending a written notice of
revocation to the Secretary of the Company at the Company's principal executive
offices.
The Board will duly appoint certain individuals to act as inspectors of
election for the Annual Meeting. The inspectors of election will tabulate all
of the votes cast at the Annual Meeting. The inspectors of election for the
Annual Meeting will treat shares of Common Stock represented by a properly
signed and returned proxy as present at the Annual Meeting for purposes of
determining a quorum, without regard to whether the proxy is marked as casting a
vote or abstaining. Likewise, the inspectors of election will treat shares of
Common Stock represented by "broker non-votes" as present for purposes of
determining a quorum. "Broker non-votes" are proxies with respect to shares
held in record name by brokers or nominees, as to which (i) instructions have
not been received from the beneficial owners or persons entitled to vote, (ii)
the broker or nominee does not have discretionary voting power under applicable
national securities exchange rules or the instrument under which it serves in
such capacity, and/or (iii) the record holder has indicated on the proxy card or
otherwise notified the Company that it does not have authority to vote such
shares on that matter.
The election of each of the directors as presented in Proposal 1 requires
an affirmative vote of the holders of a majority of the votes cast, in person or
by proxy, at the Annual Meeting. Accordingly, abstentions and broker non-votes
in the election of Directors will not affect the election of the nominees
receiving the majority of votes. The approval and ratification of the
independent auditors as presented in Proposal 2 requires the affirmative vote of
the holders of a majority of the voting power of the issued and outstanding
Common Stock, present in person or represented by proxy at the Annual Meeting
and entitled to vote thereon. Abstentions and broker non-votes as to Proposal 2
will have the same effect as a vote against the Proposal.
The adoption of the amendment to the articles of incorporation of the
Association as presented in Proposal 3 requires an affirmative vote of the
holders of a majority of the voting power of the issued and outstanding common
stock, present in person or represented in proxy at the Annual Meeting and
entitled to vote thereon. Abstentions and broker non-votes as to Proposal 3
will have the same effect as a vote against the proposal.
If any matters other than those stated in the Notice are properly presented
at the Annual Meeting for consideration, the persons named in the relevant form
of proxy enclosed herewith and acting thereunder will have the discretion to
vote on such matters in accordance with their best judgment, unless the proxy
indicates otherwise. The Company does not have any knowledge of any matters to
be presented for the vote by the Shareholders of the Company at the Annual
Meeting, other than those matters this Proxy Statement refers to and describes.
COMMON STOCK OWNERSHIP OF
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth, as of October 18, 2002, the shares of
Common Stock, $25.00 par value (the only class of the Company's voting
securities) beneficially owned by each Director, nominee for Director, and each
Executive Officer of the Company. There is no person or group (as the term is
used in Section 13(d)(3) of the Securities Exchange Act) known to the Company to
be the beneficial owner of more than five percent of this class of voting
securities.
2
NAME AND ADDRESS AMOUNT AND NATURE OF PER CENT OF COMMON
BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1)(2) STOCK BENEFICIALLY HELD
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Leone Anderson
P.O. Box 175
Deming, N.M. 88030 102.50 shares (3) *
Jim T. Hyatt
11850 Uvas Valley Rd. N.E. 28.00 shares *
Deming, N.M. 88031 286.00 shares (4) 2.07%
William R. Johnson, III
P.O. Box 468
Columbus, N.M. 88029 55.50 shares *
William C. Shattuck
110 N. Gold
Deming, N.M. 88030 101.50 shares *
Shelby C. Phillips, III
P.O. Box 2089 537.67 shares 3.90%
Deming, N.M. 88031
Grayson Smyer
P.O. Box 1956
Deming, N.M. 88031 81.17 shares *
G. G. Gore
2020 Columbus Road S. W.
Deming, N.M. 88031 118.50 shares *
Janet Robinson (6)
P.O. Box 2247
Deming, N.M. 88031 20.00 shares *
All directors and executive officers: 1,330.84 shares 9.66%
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*Less than one percent
(1) There are no shares with respect to which any person listed on this table
has the right to acquire beneficial ownership as specified in Rules
13d-3(d)(1) of the Securities Exchange Act of 1934.
(2) Unless otherwise indicated, each person listed has sole voting and
investment power over all shares.
(3) Ms. Anderson has joint voting and investment power over these shares with
her spouse.
(4) Mr. Hyatt holds these shares with shared voting and investment power which
arises through interests in a partnership and a corporation that are owners
of record.
(5) Mr. Phillips has joint voting and investment power over the shares with his
spouse.
(6) Janet Robinson is the principal accounting officer of the Company.
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ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
The Company's Articles of Incorporation provide that its Board of Directors
shall consist of not less than five stockholders to be elected at the annual
meeting to be provided for by the by-laws. The by-laws of the Company currently
fix the number at seven. Management has nominated the seven persons named and
described below to stand for election at the 2002 Annual Meeting for one-year
terms or until their successors are elected and qualified.
The shares represented by the accompanying proxy will be voted to elect the
seven nominees shown below for election unless authority to do so is withheld.
Each nominee has agreed to his or her nomination and has agreed to serve if
elected. Should any nominee become unavailable for election, the proxies will
be voted for the election of such other person as may be recommended by the
Board in place of such nominee.
NAME AGE POSITION DIRECTOR SINCE TERM EXPIRES
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Jim T. Hyatt 50 Director 1993 2002
William R.
Johnson, III 52 Director and Vice
President 1993 2002
Shelby Phillips, III 60 Chairman Of The
Board, Chief
Executive Officer,
General Manager 1999 2002
William C. Shattuck 46 Director 2000 2002
Leone Anderson 69 Director and
Secretary-
Treasurer 1997 2002
Grayson Smyer 45 Director 2001 2002*
G. G. Gore 50 Director 2001 2002
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*Douglas Tharp was a director of the Company from 1968 until December,
2001, when he resigned. His occupation for the last five years was cotton
warehousing and auctioneering. Grayson Smyer was named to fill the vacancy for
Mr. Tharp's unexpired term. Mr. Smyer has been engaged for the past five years
in farming and the brokerage of produce in the Deming area.
Jim T. Hyatt has been a director of the Company since 1993. His occupation
for the last five years has been ranching. He is a partner in Hyatt & Hyatt, a
general partnership, and president of Quartzite, Inc. Both Hyatt & Hyatt and
Quartzite, Inc. are ranching businesses.
William R. Johnson, III, has been a director of the Company since 1993 and
Vice President since 2000. His occupation for the last five years has been
farming and ranching. He is a partner in W. R. Johnson and Sons, a general
partnership in the business of farming and ranching, and a director of Carzalia
Valley Gin, Inc., a corporation involved in processing of agricultural products.
Leone Anderson has been a director of the Company since September 23, 1997.
She is a retired school teacher whose family has been active in farming in Luna
County.
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Shelby C. Phillips, III has been a director of the Company since February
1999 and Chairman of the Board, Chief Executive Officer and General Manager
since May, 2000. Mr. Phillips is the President of Adobe Developers, Inc., a
real estate development business. His principal occupation for the last five
years has been farming and ranching.
The Board meets on a regularly scheduled basis during its fiscal year to
review significant developments affecting the Company and to act on matters
requiring Board approval. It also holds special meetings when an important
matter requires Board action between scheduled meetings. During the fiscal year
ended June 30, 2002, the Board held 12 regularly scheduled meetings. None of
the directors attended less than 75% of the meetings held during the last fiscal
year. The Board has not established standing audit, nominating or compensation
committees.
No director or officer of the Company is an adverse party or has a material
interest adverse to the Company in any material transaction or any pending legal
proceedings. No director of the Company holds a directorship in any other
company with a class of stock registered under the Securities Exchange Act of
1934 or any company registered as an investment company.
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth compensation paid during each of the last
three fiscal years to each of the Company's present General Manager and Chief
Executive Officer Shelby Phillips, III, and Dean Stovall, the Company's former
General Manager and Chief Executive Officer. These gentlemen are the Company's
only "highly compensated executive officers" for the period in question as that
term is used in Item 402 (a) of Regulation S-B under the Securities Exchange Act
of 1934. Mr. Stovall resigned as General Manager and Chief Executive Officer of
the Company on May 12, 2000. Mr. Phillips assumed that role on May 21, 2000.
No other officer or employee received total compensation (i.e. salary and bonus)
in excess of $100,000 in any of the Company's past three fiscal years.
SUMMARY COMPENSATION TABLE
NAME AND PRINCIPAL FISCAL OT HER ANNUAL
POSITION YEAR SALARY BONUS COMPENSATION*
- --------------------------- ------ ------- ----- -------------
Shelby C. Phillips, III, 2002 $60,193 n.a. n.a.
General Manager and 2001 $55,000 n.a. n.a.
Chief Executive Officer 2000 $ 7,206 n.a. n.a.
Dean Stovall, Former 2002 n.a. n.a. n.a.
General Manager and 2001 n.a. n.a. n.a.
Chief Executive Officer 2000 $22,162 n.a. n.a
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* The Company has no bonus, stock option, stock bonus, stock appreciation
rights or long term incentive plans or agreements, or equity based or incentive
option plans or agreements.
5
COMPENSATION OF DIRECTORS
Directors of the Company receive the sum of $100 per month, and no other
compensation.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who beneficially own
more than 10% of the Company's stock, to file initial reports of ownership and
reports of changes in ownership with the Securities and Exchange Commission.
Executive officers, directors and greater than 10% shareholders are required by
SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file.
Based on a review of the copies of these reports furnished to the Company,
there were no late reports of ownership (or changes therein) of the Company's
Common Stock.
VOTE REQUIRED
The election of each of the directors as presented in Proposal 1 requires
an affirmative vote of the holders of a majority of the votes cast, in person or
by proxy, at the Annual Meeting.
APPOINTMENT OF INDEPENDENT AUDITORS
(PROPOSAL NO. 2)
The Board of Directors of the Company, subject to ratification by the
Shareholders of the Company, appointed The Accounting and Consulting Group, L.
L. P., of Carlsbad, with offices in Albuquerque, Alamogordo, Clovis and
Carlsbad, as independent auditors of the Company on September 24, 2002.
The Board of Directors selected The Accounting and Consulting Group,
L.L.P., as independent auditors for the Company for a second year because it was
of the opinion that this firm would provide the best overall service at a
reasonable cost. If the Shareholders do not ratify this appointment, the Board
will consider other independent auditors. A representative of The Accounting
and Consulting Group, L.L.P. will be present at the Annual Meeting, will have an
opportunity to make a statement if he or she desires to do so, and will be
available to respond to appropriate questions.
VOTE REQUIRED
The approval and ratification of the selection of the independent auditors
as presented in Proposal 2 requires the affirmative vote of the holders of a
majority of the voting power of the issued and outstanding Common Stock, present
in person or represented by proxy at the Annual Meeting and entitled to vote
thereon.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL AND RATIFICATION OF
THE APPOINTMENT OF THE ACCOUNTING AND CONSULTING GROUP, L.L.P. AS INDEPENDENT
AUDITORS OF THE COMPANY.
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AMENDMENT OF THE ARTICLES OF INCORPORATION
(PROPOSAL NO. 3)
LIMITATION ON SHARE OWNERSHIP
The Articles of Incorporation of the Company (the "Current Articles")
provide in Article IV that: "the number of shares of common stock of the
Corporation which can be owned by a single shareholder shall not exceed one and
two-tenths (1.2%) of the total authorized common stock of the corporation."
Inasmuch as the total authorized capital stock of the Company is 20,000 shares,
the effect of the provision quoted above is to limit the share ownership of any
one member to 240 shares.
Similarly, the By-Laws of the Company, as restated in 1992, provide in
Article III, Section 3 that, "No stockholder shall be permitted to own or hold
more than two hundred forty (240) shares of stock at any one time."
The Board of Directors of the Company has approved an amendment to Article
IV of the Articles of Incorporation of the Company increasing the limitation to
3.6% of the total authorized common stock of the Company thereby limiting the
shareholdings of any one shareholder to 720 shares. The background of and
reasons for this action are explained below. The amendment to the Articles also
changes Article II, a housekeeping amendment necessary to update information
concerning the Company's registered office and registered agent in the State of
New Mexico.
HISTORY AND BACKGROUND
When the Company was originally incorporated on February 10, 1913, the
Articles of Incorporation contained no limitation on share ownership. On
September 14, 1943, a Certificate of Amendment to the Certificate of
Incorporation of the Company was filed, which among other things, imposed a
limitation of shares to be held by any one member to six-tenths (6/10) of one
per cent, of authorized capital stock. On April 24, 1962, another Certificate of
Amendment was filed, increasing the total authorized capital of the Company to
its present level: $500,000, consisting of 20,000 shares of $25.00 par value
each. This amendment made no change in the maximum ownership limitation
described above. On November 8, 1984, Articles of Amendment to the Articles of
Incorporation of the Company were filed increasing the ceiling on single
ownership to the 1.2% limitation quoted above.
Presumably the limitation on ownership by one member (and later
"shareholder"), which has also been carried forward in the By-Laws of the
Company, was intended to prevent a single individual or small group of
individuals from acquiring voting control of the Company. In 1966, the Company
made an intrastate (New Mexico purchases and sales only) offering of 11,000
shares of its $25.00 par value common stock. The Offering Circular dated March
31, 1966, in a section entitled "Capitalization" had the following to say: "The
pre-emptive rights to purchase additional stock by virtue of the fact that a
person is a shareholder of the company, have not been withheld except the
Articles of Incorporation and By-Laws restricts [sic] a person from holding more
than sixtenths [sic] of one per cent (120 shares) of the total authorized stock.
In actual practice this has been difficult to control by reason of the
acquisition of some shares by inheritance." Later in the Offering Circular, in
a section entitled "Dilution and Control," the following information appeared:
"The stock of this Company is widely held among 817 stockholders and no
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stockholder or other purchser [sic] will be permitted to hold more thn [sic] 120
shares, as provided by the Articles of Incorporation and By-Laws of the
Company."
The Articles of Incorporation and By-laws of the Company do not provide any
insight into what the consequences would or should be of ownership of a greater
number of shares than the present limitation of 240 shares. It is possible that
if presented with the question, a New Mexico court would hold that any owner of
an amount exceeding that threshold would only be permitted to vote 240 shares in
any matter brought to a vote of shareholders in an annual or special meeting or
unanimous consent of shareholders. The table hereinabove shows that two
Directors of the Company, Jim T. Hyatt and Shelby C. Phillips, III, presently
own more than 240 shares. To the best of the knowledge of the Company, no other
shareholder owns more than the current limitation.
SECURITIES REPORTING REQUIREMENTS
The fact that the Company continues to have more than 500 shareholders of
record causes it to continue to incur the expense and management time related to
the preparation and filing of periodic reports with the United States Securities
and Exchange Commission (the "SEC"). Otherwise, the Company is far below the
threshold for termination of the registration of its common stock with the SEC.
SEC Rule 12g-4 under the Securities Exchange Act of 1934 (the "Exchange Act")
provides that an issuer of securities such as the Company may terminate its
periodic reporting obligation for any class of securities held of record by less
than 500 persons, where the total assets of the issuer have not exceeded $10
million on the last day of each of the issuer's three most recent fiscal years.
Although its total assets have been substantially less than $10 million for each
of its three most recent fiscal years, the Company is still required to file
reports with the SEC covering the first three quarters of each fiscal year-the
quarters ending September 30, December 31 and March 31-on Form 10-QSB. The
reports are due within forty-five (45) days after the end of each fiscal quarter
other than the last. Further, it is required to file an annual report on the
results of each fiscal year of operation by the expiration of ninety (90) days
from the end of the fiscal year on June 30. The most recent report by the
Company for the fiscal year ended June 30, 2002, filed with the SEC on September
27, 2002, has been, or is being contemporaneously, furnished to shareholders as
a part of the Annual Report. Finally, the Company is required to file with the
SEC, on Form 8-K, reports of other material events that occur in between the
required filing dates for the other periodic reports.
The requirement for these reports and the audited financial reports that go
with them imposes a substantial cost burden, chiefly in the form of legal and
accounting fees, on the Company-in the past fiscal year alone, the total of fees
and costs of this type exceeded one hundred thousand dollars ($100,000), an
amount approximately equal to the total shareholders' equity in the Company at
the beginning of the current fiscal year. Furthermore, the recent scandals that
have erupted in certain large publicly-held companies have given rise to reform
legislation, perhaps the most important to date being the Sarbanes-Oxley Act of
2002. This act brings about substantial reforms too numerous to recapitulate
here, but among its changes is a phasing in of shorter periods within which the
quarterly and annual reports of certain public companies must be filed with the
SEC. At the present time the shorter filing periods only apply to companies
substantially larger than the Company, but there can be no assurance that they
will not be applied in the future to all public companies. In the opinion of
Management, shorter filing periods generally translate into greater costs in
producing the periodic reports, either through increased technological
sophistication or greater staffing, or both. Management is advised by members
of the accounting profession that other regulatory initiatives established by
the Sarbanes-Oxley Act are likely to cause an increase in the cost of auditing
and accounting services.
8
The Board of Directors would like to relieve the Company of this burden if
it can be done without undue legal difficulty and expense. The simplest way to
do so, as the Company has been advised by counsel, is to reduce the number of
shareholders of the Company to less than 500.
REDUCING THE NUMBER OF SHAREHOLDERS
The Company has no current addresses for and has received no recent
correspondence from a large number of the more than 800 shareholders whose names
still appeared on the stockholder ledger of the Company as of July 1, 2000.
Mailings of proxy statements and annual reports to many of these shareholders
have not been responded to or have been returned, marked "Moved, left no
forwarding address," or something similar, for years. Until the past two fiscal
years, the Company was not keeping careful records of unreturned proxies,
nonattendance at shareholders' meetings or shareholder mailings that were
returned by the United States Postal Service. Further, the possibility exists
that some shareholders' names and addresses were inadvertently not removed from
the ledger after they sold their shares to someone else and that holdings by the
same person or entity may have been treated as holding by more than one person
or entity just because of the way the name was stated, e.g., "W. Dean Hester"
being treated as a different owner than "Walter D. Hester." The careful
maintenance of such records is necessary to enable the Company to ascertain just
how many shareholders it currently has, and the Company has begun focusing on
these issues since the summer of 2000.
Obviously, Management has no intention of attempting to discourage
ownership in the Company by any person or entity. In an effort to reestablish
contact with some of the lost shareholders, the Company published notices in
newspapers of general circulation in Las Cruces, New Mexico, Silver City, New
Mexico and Deming, New Mexico, providing a list of shareholders the Company had
lost touch with and asking any of them or anyone who knows the current
whereabouts of any of them to contact the Company. Also, on the advice of
counsel, Management began compiling information from the records it does have as
a predicate to making a filing under New Mexico escheat laws as regards the
rights of lost shareholders. The effect of the New Mexico law is generally
that, once a filing has been made in respect of the rights of a lost
shareholder, the Administrator of the New Mexico Taxation and Revenue Department
becomes the legal and record owner of the shares formerly owned by the lost
person or entity.
Additionally, some individual shareholders began to contact holders of
small numbers of shares about selling their shares, not to the Company, but to
the other individual shareholders. There is no established trading market for
the shares of the Company, and the Company's recent financial difficulties make
it unlikely that any such market will develop. Some holders of small numbers of
shares have recently sold their shares at individually negotiated prices to
owners of larger numbers of shares. The individual shareholders purchasing
small blocs of shares have advised the Company that they have no intention of
aggregating their holdings with others or forming any sort of group seeking
control of the Company. Their purpose is merely to facilitate the reduction in
the number of shareholders below the regulatory threshold. In the past twelve
months, through a combination of individual share purchases and the Company's
filing under the Uniform Disposition of Unclaimed Property Act with the New
Mexico Unclaimed Property Office in the Taxation and Revenue Department, the
Company has reduced its number of shareholders from 823 to 639. It is possible
that, through a combination of continuing to keep more careful records of its
shareholder contacts or lack thereof and the purchases by some shareholders of
the holdings of others, the number of shareholders of record of the Company can
be reduced below 500.
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The limitation on ownership by a single shareholder is an obvious barrier
to the purchase of additional shares by shareholders generally, and in
particular the purchase from small shareholders by members of the Board of
Directors or other friends of the Company who would like to help the Company
reduce the number of shareholders below 500. The uncertainty as to the voting
status of any shares owned in excess of the 240 limit tends to discourage
shareholders who might otherwise purchase additional shares for any reason,
including an attempt to reduce the overall number of shareholders.
AMENDING THE ARTICLES OF INCORPORATION TO INCREASE THE CEILING ON SHARE
OWNERSHIP
The Board of Directors believes it would be in the best interests of the
Company to increase the maximum permitted ownership of shares of the Company's
common stock to three and six-tenths per cent (3.6%), which at its current
capitalization would limit individual ownership to 720 shares of the Company's
$25.00 par value common stock. Such an increase requires (i) the adoption of
the existing Board of Directors of Articles of Amendment to Articles II and IV
of the Company's Articles of Incorporation, a copy of which, together with the
Restated Articles of Incorporation of the Company as they will read after the
amendment, is attached hereto as Exhibit A, and (ii) the adoption of the
Amendment and the Restated Articles of Incorporation by the Company's
shareholders.
VOTE REQUIRED
The adoption of the amendment to the Articles of Incorporation of the
Company and the Restated Articles of Incorporation as presented in Proposal 3
requires an affirmative vote of the holders of a majority of the voting power of
the issued and outstanding common stock, present in person or represented in
proxy at the Annual Meeting and entitled to vote thereon.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ADOPTION OF THE AMENDMENT TO THE
ARTICLES OF INCORPORATION AND THE RESTATED ARTICLES OF INCORPORATION.
OTHER MATTERS
STOCKHOLDER PROPOSALS FOR 2003 ANNUAL MEETING
Any proposals of Shareholders intended to be presented at the Company's
2003 Annual Meeting of Shareholders must be received at the Company's principal
executive offices by no later than June 28, 2003, if such proposal is to be
considered eligible for inclusion in the Company's proxy statement for that
meeting. With respect to proxies received by the Company's management for the
2003 Annual Meeting, Management may exercise its discretionary voting authority
on any stockholder proposal that is received at the Company's principal
executive offices after September 9, 2003.
INCORPORATION OF FORM 10-KSB BY REFERENCE
The Company's 2002 Annual Report on Form 10-KSB, which is attached, is
incorporated into this proxy statement by reference.
10
OTHER BUSINESS
At the date of this Proxy Statement, the Board is not informed of any
matters, other than those stated above, that may be considered at the Annual
Meeting. However, if any other matters shall properly come before the meeting,
it is the intention of the persons named in the enclosed form of proxy to vote
the proxy in accordance with their best judgment on such matters.
By Order of the Board of Directors
Shelby C. Phillips, III,
Chairman
Deming, New Mexico
11
PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
MIMBRES VALLEY FARMERS ASSOCIATION, INC.
The undersigned hereby constitutes and appoints Shelby C. Phillips, III and
William R. Johnson III or either of them, with full power of substitution, as
Proxies to vote all shares of Common Stock of Mimbres Valley Farmers
Association, Inc. (the "Company") which the undersigned may be entitled to vote
at the Annual Meeting of the Shareholders of the Company to be held on November
22, 2002, and at any and all adjournments thereof, for the following purposes
(as described in the Proxy Statement):
The Board of Directors strongly urges that you vote to elect the following
Director nominees, to approve and ratify the selection of independent auditors
to approve an amendment to the Articles of Incorporation and to grant
discretionary authority as set forth below:
1. ELECTION OF DIRECTORS ______ FOR all nominees listed ______ WITHHOLD AUTHORITY
below (except as to vote for all nominees
marked to the contrary) listed below
INSTRUCTION:
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE STRIKE A LINE
THROUGH THE NOMINEE'S NAME IN THE LIST BELOW.
Shelby Phillips III William R. Johnson III Leone Anderson Grayson Smyer
Jim Hyatt William C. Shattuck G. G. Gore
2. FOR____ AGAINST____ ABSTAIN____ APPROVAL and ratification of appointment of The
Accounting and Consulting Group, L.L.P.,
as independent auditors of the Company.
3. FOR____ AGAINST____ ABSTAIN____ APPROVAL of the Articles of Amendment and the Restated
Articles of Incorporation of the Company.
4. GRANTED ____ WITHHELD ____ In their discretion, the Proxies are authorized to vote
upon such other business as may properly
come before the meeting.
PLEASE PROMPTLY MARK, DATE, SIGN AND RETURN PROXY IN THE ENCLOSED ENVELOPE.
This proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE ELECTION AS DIRECTORS OF ALL NOMINEES LISTED IN ITEM 1 ABOVE, FOR THE
APPROVAL AND RATIFICATION OF THE INDEPENDENT AUDITORS NAMED IN ITEM 2 ABOVE, FOR
THE AMENDMENT TO THE ARTICLES OF INCORPORATION DESCRIBED IN ITEM 3 ABOVE, AND IN
THE PROXIES' DISCRETION ON MATTERS ARISING UNDER ITEM 4 ABOVE.
Date: .
-------------------------------
- ------------------------------------ ------------------------------------
(Signature) (Signature)
Please sign as your name appears on stock certificate. When signing as
executor, administrator, attorney, trustee or guardian, please give your full
title as such. If a corporation, please sign in full corporate name by president
or other authorized officer. If a partnership or limited liability company,
please sign in partnership or limited liability company name by authorized
person. If a joint tenancy, please have both joint tenants sign.
12
EXHIBIT A
ARTICLES OF AMENDMENT TO
AND RESTATEMENT OF
ARTICLES OF INCORPORATION
OF
MIMBRES VALLEY FARMERS ASSOCIATION, INC.
---------------------------------------
Pursuant to the provisions of Sections 53-13-2, 3, 4 and 7 of the New Mexico
Business Corporation Act, the undersigned corporation adopts the following
Articles of Amendment to and Restatement of its Articles of Incorporation.
ARTICLE ONE
The name of the corporation is MIMBRES VALLEY FARMERS ASSOCIATION, INC.
ARTICLE TWO
The Amendment alters or changes Articles II and IV of the Articles of
Incorporation and the full text of each provision as it is amended to read is as
follows:
II
"The location of the principal office and the registered office of
said corporation in this State is 811 South Platinum, Deming, New
Mexico 88030 and its registered agent is Shelby C. Phillips, III."
* * *
IV
"The amount of the total authorized capital stock of this corporation
is five hundred thousand dollars ($500,000), which is divided into
twenty thousand (20,000) shares, of the par value of twenty-five
dollars ($25) per share. Said corporation will commence business with
a capital stock of two thousand dollars ($2,000). The number of shares
of common stock of the corporation which can be owned by a single
shareholder shall not exceed three and six/tenths percent (3.6%) of
the total authorized common stock of the corporation."
ARTICLE THREE
The amendment is incorporated in the Restated Articles of Incorporation of the
corporation attached hereto and by this reference incorporated herein. The
Restated Articles of Incorporation, except as amended hereby, set forth without
change the corresponding provisions of the Articles of Incorporation as
heretofore amended and the Restated Articles of Incorporation with the amendment
herein adopted supersede the original Articles of Incorporation and all
amendments thereto.
ARTICLE FOUR
The foregoing Amendment to the Articles of Incorporation and the Restated
Articles of Incorporation were adopted by resolution of the Board of Directors
dated as of October 10, 2002 and directed to be submitted to a vote of
shareholders. The foregoing Amendment to the Articles of Incorporation and the
Restated Articles of Incorporation were adopted by the shareholders of the
corporation at the Annual Meeting of Shareholders on November 22, 2002.
ARTICLE FIVE
The Amendment and the Restated Articles of Incorporation were approved by an
affirmative vote of the holders of a majority of the shares entitled to vote
thereon in accordance with Section 53-13-2 of the New Mexico Business
Corporation Act. The number of shares of common stock of the corporation, $25
par value, outstanding and entitled to vote on the Amendment was 13,781.47. The
number of shares of common stock of the corporation voted for the Amendment was
__________ and the number of shares of common stock of the corporation voted
against the Amendment was _________.
ARTICLE SIX
The Articles of Incorporation of the corporation provide only for the issuance
of common stock; accordingly, only holders of common stock were entitled to vote
and did vote on the Amendment. The Amendment did not provide for any exchange,
reclassification, or cancellation of issued shares and did not effect a change
in the stated capital of the corporation.
EXECUTED this ______ day of November, 2002.
MIMBRES VALLEY FARMERS ASSOCIATION, INC.
By:
-----------------------------------
Shelby C. Phillips, III
President
RESTATED
ARTICLES OF INCORPORATION
(As of November 22, 2002)
Of
MIMBRES VALLEY FARMERS ASSOCIATION, INC.
These Restated Articles of Incorporation of Mimbres Valley Farmers Association,
Inc. correctly set forth without change the corresponding provisions as amended
to date and the Restated Articles of Incorporation supersede the original
articles of incorporation of the corporation and all previous amendments.
I
The name of this corporation is MIMBRES VALLEY FARMERS ASSOCIATION, INC.
II
The location of the principal office and the registered office of said
corporation in this State is 811 South Platinum, Deming, New Mexico 88030 and
Shelby C. Phillips III is its registered agent.
III
The objects for which this corporation is formed are as follows:
To buy, sell and exchange merchandise of every name, kind, nature and
description;
To purchase, or otherwise acquire, real estate, and to erect, purchase, or
otherwise acquire, own and operate, storehouses, warehouses, tanks,
depositories, and any and all other buildings and structures necessary or useful
in the conduct of the business of this corporation;
To encourage, promote, establish, manage and operate creameries, dairies,
cold storage plants, canning and pickling plants and factories, and any and all
other manufacturing plants and enterprises for the purpose of using and
converting the agricultural, horticultural and dairy products of the Mimbres
Valley, and to erect, or otherwise acquire, such manufacturing or other plants,
for the purpose of their management and operation by lessees;
To encourage, promote, finance and manage agricultural fairs and exhibits
in the Mimbres Valley;
To enter into contracts with producers for the raising of crops, and with
commission merchants, brokers, or others, for the marketing and disposal
thereof;
To employ, contract with, and compensate, skilled persons to instruct the
stockholders of this corporation in the theory and art of agriculture,
horticulture, dairying, stock raising and irrigation, and to instruct and assist
this corporation in the marketing and sale of the products of the Mimbres
Valley;
To buy, sell and exchange live stock;
To do and perform any and all other acts or things necessary to, or tending
to promote, the general purposes of this corporation, which are hereby declared
to be the development of the agricultural, horticultural, dairy and livestock
industries in the Mimbres Valley, and the improvement of market conditions.
IV
The amount of the total authorized capital stock of this corporation is
five hundred thousand dollars ($500,000), which is divided into twenty thousand
(20,000) shares, of the par value of twenty-five dollars ($25) per share. Said
corporation will commence business with a capital stock of two thousand dollars
($2,000). The number of shares of common stock of the corporation which can be
owned by a single shareholder shall not exceed three and six/tenths percent
(3.6%) of the total authorized common stock of the corporation.
V
The names and post office addresses of the incorporators, and the number of
shares subscribed by each, are as follows:
Name Post office Address Number of Shares,
John Hund Deming, New Mexico, 40 shares,
Hugh Ramsay Deming, New Mexico, 40 shares,
H.E. VanSickle Deming, New Mexico, 40 shares,
George W. McCan Deming, New Mexico, 40 shares,
S. J. Smith Deming, New Mexico, 40 shares.
VI
The duration of this corporation shall be perpetual.
VII
The Board of Directors shall consist of not less than five stockholders to
be elected at the annual meeting to be provided for by the by-laws. The Board
of Directors, during the first three months, or until successors shall have been
elected and shall have qualified, shall consist of the incorporators herein
named.
VIII
The Board of Directors shall have the power to adopt and alter by-laws.
IX
Dividends may be declared and paid, at such times, and in such amounts, as
the Board of Directors shall deem best, provided; that the capital stock of the
corporation shall not thereby be impaired.
X
The quorum requirement for shareholder's meetings, either annual or
special, shall be one-third (1/3) of the issued and outstanding shares of the
common stock of the corporation.