SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec.240.14a-12
INTERVEST BANCSHARES CORPORATION
--------------------------------
(Name of Registrant as Specified in its Charter)
---------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] $125 per Exchange Act Rules O-11(c)(1)(ii), 14a-6(i)(1) and (2) or Item
22(a)(2) of Schedule 14A
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies: ______
2) Aggregate number of securities to which transaction applies: _________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule O-11: __________________________________
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: ___________________________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON THURSDAY, MAY 26, 2005
NOTICE IS HEREBY GIVEN that the 2005 Annual Meeting of Stockholders (the
"Annual Meeting") of Intervest Bancshares Corporation (the "Company") will be
held on Thursday, May 26, 2005, at 9:30 a.m., New York time, at the offices of
the Company, One Rockefeller Plaza (Suite 400) New York, New York, 10020 for the
following purposes:
1. To elect directors; and
2. To transact such other business as may properly come before the
Annual Meeting or any adjournment or postponement thereof.
Pursuant to the Bylaws, the Board of Directors has fixed the close of
business on April 11, 2005 as the record date for the determination of
stockholders entitled to notice of and to vote at the Annual Meeting. Only
holders of Class A or Class B Common Stock of record at the close of business on
that date will be entitled to notice of and to vote at the Annual Meeting or any
adjournment or postponement thereof.
By Order of the Board of Directors,
Jerome Dansker
Chairman of the Board
April 21, 2005
New York, New York
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT
YOU PLAN TO BE PRESENT IN PERSON AT THE ANNUAL MEETING, PLEASE SIGN, DATE AND
COMPLETE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
PROXY STATEMENT
2005 ANNUAL MEETING OF STOCKHOLDERS
INTERVEST BANCSHARES CORPORATION
ONE ROCKEFELLER PLAZA (SUITE 400)
NEW YORK, NEW YORK 10020-2002 (212) 218-2800
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors (sometimes referred to herein as the "Board") of
Intervest Bancshares Corporation, a Delaware corporation (the "Company") of
proxies for use at the Annual Meeting of Stockholders (the "Annual Meeting"), to
be held on Thursday, May 26, 2005, or any adjournment or postponement thereof,
for the purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders.
This Proxy Statement and the accompanying proxy card are being mailed to
stockholders commencing on or about April 21, 2005. The Annual Report for the
year ended December 31, 2004, including financial statements, is being mailed to
stockholders concurrently with this mailing.
You will find a form of proxy in the envelope in which you received
this Proxy Statement. PLEASE SIGN AND RETURN THIS PROXY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE. A stockholder giving a proxy may revoke it at any time
prior to the commencement of the Annual Meeting by: filing a written notice of
revocation with the Secretary of the Company prior to the meeting; or delivering
to the Secretary of the Company a duly executed proxy bearing a later date; or
attending the Annual Meeting, filing a written notice of revocation with the
Secretary of the meeting and voting in person.
If the enclosed form of proxy is properly signed and returned to the
Company in time to be voted at the Annual Meeting, the shares represented
thereby will be voted in accordance with the instructions marked thereon. SIGNED
PROXIES WITH NO INSTRUCTIONS THEREON WITH RESPECT TO THE PROPOSAL SET FORTH IN
THE ACCOMPANYING NOTICE OF ANNUAL MEETING WILL BE VOTED FOR THE ELECTION OF THE
NOMINEES FOR DIRECTOR. If any other matters are properly brought before the
Annual Meeting, the persons named in the accompanying proxy will vote the shares
represented by such proxy on such matters as shall be determined by a majority
of the Board of Directors or its Executive Committee.
The voting securities of the Company entitled to vote at the Annual Meeting
consist of shares of Class A and Class B Common Stock. Only stockholders of
record at the close of business on April 11, 2005 are entitled to notice of and
to vote at the Annual Meeting. As of March 31, 2005, there were 5,888,843 shares
of the Company's Class A Common Stock and 385,000 shares of the Company's Class
B Common Stock issued and outstanding.
The holders of the outstanding shares of Class B Common Stock are entitled
to vote for the election of two-thirds of the directors of the Company rounded
up to the nearest whole number, or eight directors. The holders of the
outstanding shares of Class A Common Stock are entitled to vote for the election
of the remaining directors of the Company, or three directors. The holders of
both Class A and Class B Common Stock as of the record date are entitled to vote
on all other matters to come before the meeting, and each is entitled to one
vote for each share held on the record date.
A majority of the outstanding shares of Common Stock entitled to vote,
represented in person or by proxy, will constitute a quorum for the transaction
of business at the Annual Meeting. Abstentions and broker non-votes will be
counted as present for purposes of determining whether a quorum is present, but
will have no effect on the vote. If a quorum is present, the three nominees for
election by the holders of Class A Common Stock and the eight nominees for
election by the holders of Class B Common Stock who receive the highest number
of votes cast by holders of shares of Class A Common Stock and Class B Common
Stock, respectively, will be elected as directors of the Company.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock as of March 31, 2005 by (i) each person
who is known by the Company to be the beneficial owner of more than 5% of the
outstanding Common Stock of the Company, (ii) each of the Company's directors,
(iii) each executive officer of the Company and (iv) all current directors and
executive officers of the Company as a group.
CLASS A COMMON STOCK CLASS B COMMON STOCK
------------------------- -----------------------
NAME OF BENEFICIAL HOLDER SHARES % CLASS(1) SHARES % CLASS(1)
- ------------------------- ------------- ---------- ----------- ----------
HELENE D. BERGMAN 434,000 (2) 7.37% 75,000 19.48%
DIRECTORS AND EXECUTIVE OFFICERS
- --------------------------------
LAWRENCE G. BERGMAN 402,800 6.84% 75,000 19.48%
Director, Vice President and Secretary
MICHAEL A. CALLEN 25,000 0.42% - -
Director
LOWELL S. DANSKER 928,500 (3) 15.77% 150,000 38.96%
Vice Chairman and President
JEROME DANSKER 1,005,965 (4) 15.74% 280,000 (4) 48.28%
Chairman and Chief Executive Officer
PAUL R. DEROSA 5,000 0.08% - -
Director
STEPHEN A. HELMAN 37,600 0.64% - -
Director
WAYNE F. HOLLY 18,700 (5) 0.32% - -
Director
LAWTON SWAN, III 500 0.01% - -
Director
THOMAS E. WILLETT 6,000 0.10% - -
Director
DAVID J. WILLMOTT 99,047 1.68% - -
Director
WESLEY T. WOOD 92,500 1.57% - -
Director
ALL DIRECTORS AND EXECUTIVE OFFICERS 2,621,612 41.02% 505,000 87.07%
AS A GROUP (11 PERSONS)
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(1) Percentages have been computed based upon the total outstanding shares
of the Company plus, for each person and the group, shares that person or
the group has the right to acquire pursuant to warrants or convertible
debentures, if any. The address of all persons listed is: Care of Intervest
Bancshares Corporation, One Rockefeller Plaza (Suite 400) New York, New
York 10020.
(2) Includes 128,571 shares held by a family limited liability company and
10,350 shares held by adult children.
(3) Includes 207,336 shares held by a family limited liability company,
10,500 shares held by children and 200 shares held by his spouse.
(4) Includes 501,465 shares of Class A common stock issuable upon the
exercise of warrants and 36,000 shares held by his spouse. The shares of
Class B common stock include 195,000 shares issuable upon the exercise of
warrants and 30,000 shares held by his spouse.
(5) Includes 2,500 shares held by minor children.
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PROPOSAL ONE: ELECTION OF DIRECTORS
At the Annual Meeting, it is proposed to elect a Board of 11 directors,
each to serve until the next annual meeting or until a successor is elected and
qualified. If no contrary specification is made, the persons named in the proxy
card will vote for the election of the nominees named below. If any of these
nominees should decline election or should by reason of unexpected occurrence
not be able to serve, the persons named in the proxy card may exercise
discretionary authority to vote for a substitute or substitutes. All of the
nominees are presently serving as directors of the Company.
The names of the nominees and certain information about them are set forth
below.
FOR ELECTION BY THE HOLDERS OF CLASS A COMMON STOCK:
MICHAEL A. CALLEN, age 64, serves as a Director of the Company and has
served in such capacity since May 1994. Mr. Callen received a Bachelor of Arts
degree from the University of Wisconsin in Economics and Russian. Mr. Callen is
President of Avalon Argus Associates, a financial consulting firm. Mr. Callen
had been Senior Advisor, The National Commercial Bank, Jeddah, Kingdom of Saudi
Arabia for more than five years and prior to 1993 was a Director and Sector
Executive at Citicorp/Citibank, responsible for corporate banking activities in
North America, Europe and Japan. Mr. Callen is also a Director of Intervest
National Bank and Intervest Mortgage Corporation, and also serves as a Director
of AMBAC, Inc.
WAYNE F. HOLLY, age 48, serves as a Director of the Company and has served
in such capacity since June 1999. Mr. Holly received a Bachelor of Arts degree
in Economics from Alfred University. Mr. Holly is Chairman and President of
Sage, Rutty & Co., Inc., members of the Boston Stock Exchange, with an office in
Rochester, New York. Mr. Holly has been an Officer and Director of Sage, Rutty &
Co., Inc. for more than five years. Mr. Holly is also a Director of Intervest
National Bank and Intervest Mortgage Corporation.
LAWTON SWAN, III, age 62, serves as a Director of the Company and has
served in such capacity since February 2000. Mr. Swan received a Bachelor of
Science degree from Florida State University in Business Administration and
Insurance. Mr. Swan is President and Chairman of the Board of Interisk
Corporation, a consulting firm specializing in risk management and employee
benefit plans, which he founded in 1978. Mr. Swan is also a Director of
Intervest National Bank and Intervest Mortgage Corporation.
FOR ELECTION BY THE HOLDERS OF CLASS B COMMON STOCK:
LAWRENCE G. BERGMAN, age 60, serves as a Director, Vice President and
Secretary of the Company and has served in such capacities since the Company was
organized. Mr. Bergman received a Bachelor of Science degree and a Master of
Engineering (Electrical) degree from Cornell University, and a Master of Science
in Engineering and a Ph.D degree from The Johns Hopkins University. Mr. Bergman
is also a Director of Intervest National Bank, and a Director, Vice-President
and Secretary of Intervest Mortgage Corporation and Intervest Securities
Corporation.
JEROME DANSKER, age 86, serves as Chairman of the Board of Directors and
Chief Executive Officer of the Company. He has served as Chairman of the Board
since 1996 and Chief Executive Officer since 2004. Mr. Dansker received a
Bachelor of Science degree from the New York University School of Commerce,
Accounts and Finance, a law degree from the New York University School of Law,
and is admitted to practice as an attorney in the State of New York. Mr.
Dansker is also Chairman of the Board of Directors of Intervest National Bank
and Intervest Securities Corporation and he is Chairman of the Board of
Directors and Executive Vice President of Intervest Mortgage Corporation.
LOWELL S. DANSKER, age 54, serves as a Vice Chairman of the Board of
Directors, President and Treasurer of the Company, and has served in such
capacities, except for Vice Chairman, since the Company was organized. He has
served as Vice Chairman since October 2003. Mr. Dansker received a Bachelor of
Science in Business Administration from Babson College, a law degree from the
University of Akron School of Law, and is admitted to practice as an attorney in
the State of New York, Ohio,
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Florida and the District of Columbia. Mr. Dansker also serves as: Vice Chairman
of the Board of Directors and Chief Executive Officer of Intervest National
Bank; Vice Chairman of the Board of Directors, President and Treasurer of
Intervest Mortgage Corporation; and as Vice Chairman of the Board of Directors
and Chief Executive Officer of Intervest Securities Corporation.
PAUL R. DEROSA, age 63, serves as a Director of the Company and has served
in such capacity since February 2003. Mr. DeRosa received a Ph.D degree in
Economics from Columbia University. Mr. DeRosa is a principal of Mt. Lucas
Management Corp., where he is responsible for management of fixed income
investments of that firm's Peak Partners Hedge Fund, and has served in that
capacity since 1988. From July 1995 to March 1998, Mr. DeRosa was Chief
Executive Officer of Eastbridge Holdings Inc. Mr. DeRosa is also a Director of
Intervest National Bank and Intervest Mortgage Corporation.
STEPHEN A. HELMAN, age 65, serves as a Director of the Company and has
served in such capacity since December 2003. Mr. Helman received a Bachelor of
Arts degree from the University of Rochester and a law degree from Columbia
University. Mr. Helman is an attorney in private practice in the State of New
York. Mr. Helman is also a Director of Intervest National Bank and Intervest
Mortgage Corporation.
THOMAS E. WILLETT, age 57, serves as a Director of the Company and has
served in such capacity since March 1999. Mr. Willett received a Bachelor of
Science degree from the United States Air Force Academy and a law degree from
Cornell University School of Law. Mr. Willett has been a partner of Harris
Beach PLLC, a law firm in Rochester, New York, for more than five years and is
also a Director of Intervest National Bank and Intervest Mortgage Corporation.
DAVID J. WILLMOTT, age 66, serves as a Director of the Company and has
served in such capacity since March 1994. Mr. Willmott is a graduate of Becker
Junior College and attended New York University Extension and Long Island
University Extension of Southampton College. Mr. Willmott is the Editor and
Publisher of Suffolk Life Newspapers, which he founded more than 25 years ago
and is also a Director of Intervest National Bank and Intervest Mortgage
Corporation.
WESLEY T. WOOD, age 62, serves as a Director of the Company and has served
in such capacity since March 1994. Mr. Wood received a Bachelor of Science
degree from New York University School of Commerce. Mr. Wood is a Director and
President of Marketing Capital Corporation, an international marketing
consulting and investment firm which he founded in 1973. Mr. Wood is also a
Director of Intervest National Bank and Intervest Mortgage Corporation, an
Advisory Board Member of The Center of Direct Marketing at New York University,
a member of the Advisory Trustees at Fairfield University in Connecticut, and a
Trustee of St. Dominics R.C. Church in Oyster Bay, New York.
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION BY THE CLASS A AND CLASS B SHAREHOLDERS OF THE FOREGOING NOMINEES
FOR DIRECTOR.
- --------------------------------------------------------------------------------
Jerome Dansker is the father of Lowell S. Dansker. Lawrence G. Bergman is
the former son-in-law of Jerome Dansker and Helene D. Bergman is the daughter of
Jerome Dansker. Otherwise, there are no family relationships between any
director, executive officer or any person nominated or chosen by the Board of
Directors to become a director or executive officer.
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS
The Company is committed to maintaining the highest standards of business
conduct and corporate governance, which management believes are essential to
running the business efficiently, serving the Company's stockholders well and
maintaining the Company's integrity in the marketplace. The Company has adopted
a written code of business conduct and ethics that applies to its directors,
officers and employees. In addition, the Company's Audit Committee has also
adopted procedures for the submission of complaints or concerns regarding
financial statement disclosures and other matters. Copies of these documents
will be furnished upon written request and without charge to beneficial holders
of the Class A Common Stock of the Company by writing to: Intervest Bancshares
Corporation, Attention: Secretary, One Rockefeller Plaza (Suite 400) New York,
New York, 10020.
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DIRECTOR NOMINATIONS PROCESS
The Company does not have a standing nominating committee, and the Board of
Directors has determined that its Director Nomination Policy works efficiently
without the need for a separate nominating committee. Candidates for nomination
for election by the holders of Class A Common Stock are reviewed by those
Directors who qualify as "Independent" Directors, as such term is defined in the
rules of the National Association of Securities Dealers ("NASD"). The
Independent Directors then recommend a slate of nominees for election by the
Class A stockholders to the full Board of Directors for review and approval. The
full Board of Directors approves the nominees for election by the holders of
Class A and Class B Common Stock. The Independent Directors will consider
candidates recommended by management of the Company, and will also consider
candidates recommended by any shareholder of the Company. There are no
differences in the manner in which the Company's Independent Directors evaluate
shareholder-recommended nominees, as compared with nominees obtained from other
sources.
Any shareholder of the Company may nominate one or more persons for
election by the holders of Class A Common Stock as a Director of the Company at
an annual meeting if the shareholder complies with the notice, information and
consent provisions contained in the Company's bylaws. In order for the director
nomination to be timely, a shareholder's notice to the Company's Secretary must
be delivered not less than 90 days nor more than 120 days in advance of the
corresponding date of the proxy statement and notice released to shareholders in
connection with the Company's immediately preceding annual meeting of
shareholders. In the event that the Company sets an annual meeting date that is
not within 30 days before or after the date of the immediately preceding annual
meeting, notice by the shareholder must be received no later than the close of
business on the 10th day following the day on which notice of the date of the
meeting was mailed or public disclosure of the date was made, whichever occurs
first. To be in proper form, a notice must also contain information concerning
the proposed nominee, including: the name, age, business address and residence
address of the person; the principal occupation of the person; the beneficial
ownership of Company shares of the person; and any other information related to
the person that would be required to be filed in a proxy statement or other
filings required to be made in connection with the solicitation of proxies.
AFFIRMATIVE DETERMINATIONS REGARDING DIRECTOR INDEPENDENCE
The Board of Directors has determined that each of the following Directors
is an "independent" director as such term is defined in Marketplace Rule
4200(a)(15) of the NASD rules: Michael A. Callen; Paul R. DeRosa; Stephen A.
Helman; Lawton Swan, III; Thomas E. Willett; David J. Willmott; and Wesley T.
Wood. In this Proxy Statement, these seven directors are referred to
individually as an "Independent Director" and collectively as "Independent
Directors." A director is considered independent only if the director does not
have, and generally has not had in the most recent three years, any material
relationships with the Company, including any affiliation with the Company's
independent auditors.
The Board of Directors has also determined that each member of the Audit
Committee meets the independence requirements applicable to that Committee
prescribed by the NASD and the Securities and Exchange Commission ("SEC"). The
Board further determined that Michael A. Callen and Paul R. DeRosa, members of
the Audit Committee, are "Audit Committee Financial Experts," as such term is
defined in applicable SEC rules.
COMMUNICATIONS WITH THE BOARD
The Company has a procedure in place to facilitate communications to the
Board of Directors by shareholders. Under the process approved by the Board, the
Secretary reviews all correspondence addressed to the Board of Directors or any
individual member of the Board, and will forward to the Board a summary of all
such correspondence and copies of all correspondence that, in the opinion of the
Secretary, deals with the functions of the Board or any of its Committees or
that is otherwise determined to require the Board's attention. Directors may at
any time review a log of all correspondence received by the Company that is
addressed to the Board or individual members of the Board and request copies
5
of such correspondence. Concerns related to accounting, internal controls or
auditing matters are immediately brought to the attention of the Company's Audit
Committee and are handled in accordance with procedures established by the Audit
Committee. Individuals may communicate with the Board by writing to Intervest
Bancshares Corporation, Attention: Secretary, One Rockefeller Plaza (Suite 400)
New York, New York 10020.
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
Regular meetings of the Board of Directors are held every other month and
special meetings of the Board of Directors are held from time to time as needed.
The Board of Directors held six meetings in 2004. The Independent Directors meet
at regularly scheduled sessions without the Company's management.
During the period that each Director served as such, all of the Directors
attended at least 75% of the total meetings held by the Board of Directors and
by the Committees on which they served during 2004. The Company does not have a
policy that requires members of the Board to attend its annual meeting of
shareholders. Three members of the Board attended the Company's most recent
annual meeting of shareholders.
COMMITTEES OF THE BOARD OF DIRECTORS
Currently, the Board of Directors has the following standing committees:
EXECUTIVE COMMITTEE. Members of the Executive Committee are Jerome
Dansker, Chairman, Lawrence G. Bergman and Lowell S. Dansker. The Executive
Committee exercises all of the power of the Board between meetings of the Board.
The Executive Committee held seven meetings in 2004.
AUDIT COMMITTEE. Members of the Audit Committee are Michael A. Callen,
Chairman, Paul R. DeRosa, Lawton Swan, III and David J. Willmott. The members of
the Audit Committee are independent as defined in Rule 4200(a)(15) of the NASD
rules. The Audit Committee held five meetings in 2004.
As set forth in more detail in its charter, the Audit Committee's primary
responsibilities fall into three broad categories: (1) monitoring the
preparation of quarterly and annual financial statements by the Company's
management, including discussions with management and the Company's outside
auditors; (2) responsible for matters concerning the relationship between the
Company and its outside auditors, including: recommending their appointment or
removal; reviewing the scope of their audit services and related fees, as well
as any other services that may be provided to the Company; and determining
whether the outside auditors are independent; and (3) oversee the implementation
of effective systems of internal controls, including review of policies relating
to legal and regulatory compliance, ethics and conflicts of interest; and review
of the activities and recommendations of the Company's internal auditor.
COMPENSATION COMMITTEE. The Compensation Committee was formed in October
2004. Members of the Compensation Committee are Wesley T. Wood, Chairman,
Michael A. Callen and Paul R. DeRosa. All members of the Compensation Committee
are independent directors under the NASD corporate governance rules. The
Compensation Committee held two meetings in 2004.
The Compensation Committee is responsible for setting executive officer
compensation, for making recommendations to the full Board concerning Director
compensation and for general oversight of the compensation and benefit programs
for the Company's other employees.
Only independent directors serve on the Compensation Committee. No member
of the Compensation Committee had any relationship with the Company requiring
disclosure under applicable SEC rules. No executive officer of the Company
served on any board of directors or compensation committee of any other company
(except for wholly owned subsidiaries of the Company) for which any of the
Company's Directors served as an executive officer.
6
COMPENSATION OF DIRECTORS
Directors of the Company receive fees for attendance at the meeting of the
Board of Directors and at meetings of the Committees of the Board. The amount of
these fees are evaluated and adjusted periodically by the Board of Directors
based on the recommendation of the Compensation Committee. Director fees were
increased on October 21, 2004. The fees paid currently and prior to the increase
are noted in the table that follows:
Amount Per
----------------------
Meeting Attended
----------------------
Currently Prior
---------- ----------
Chairman and Vice Chairman of the Board of Directors of the Company (1) $ 4,000 $ 3,500
Other Directors of the Company (1) $ 1,250 $ 750
Chairman of all Board Committees of the Company and its subsidiaries $ 1,000 $ 750
Other members of all Board Committees of the Company and its subsidiaries $ 750 $ 500
- --------------------------------------------------------------------------------------------------
(1) The same fee is also paid for each Board Meeting of Interest National
Bank and Intervest Mortgage Corporation attended by each Director, except
for Messrs. Raymond Sullivan and Keith Olsen who are Directors of Intervest
National Bank and do not receive any compensation for attending meetings.
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
The following report of the Audit Committee does not constitute soliciting
material and shall not be deemed filed or incorporated by reference into any
Company filing under the Securities Act of 1933 or the Securities Exchange Act
of 1934, except to the extent the Company specifically incorporates this report
by reference therein.
We, the Audit Committee of the Board of Directors, are directors who meet
the NASD standards for independence. Each of us also meets the SEC's
requirements for audit committee member independence. We operate under a written
charter adopted by the Board of Directors.
We met with management periodically during the year to consider the
adequacy of the Company's internal controls and the objectivity of its financial
reporting. We discussed these matters with Hacker, Johnson & Smith, P.A., P.C,
the Company's independent auditors ("Auditors"), and with appropriate Company
financial personnel and the Company's internal auditor. We also discussed with
the Company's senior management and Auditors the process used for certifications
by the Company's principal executive officer and financial officer, which are
required for certain of the Company's filings with the SEC. We met privately at
our regularly scheduled committee meetings with both the Auditors and the
internal auditor, as well as with the principal financial officer and the
Company's counsel, each of whom has unrestricted access to us.
Management has primary responsibility for the Company's financial
statements and the overall reporting process, including the Company's system of
internal controls. The Auditors audited the annual financial statements prepared
by management, expressed an opinion as to whether those financial statements
fairly present the financial position, results of operations and cash flows of
the Company in conformity with U.S. generally accepted accounting principles and
discussed with us any issues they believe should be raised with us.
We reviewed with management and the Company's Auditors, the Company's
audited financial statements, and met separately with both management and the
Auditors to discuss and review those financial statements and reports prior to
issuance. Management has represented and the Auditors have confirmed to us that
the financial statements were prepared in accordance with U.S. generally
accepted accounting principles.
We appointed the Auditors as the independent auditors for the Company for
2005 after reviewing the firm's performance and independence from management. We
received from and discussed with the Auditors written disclosure and the letter
required by Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees). These items relate to that firm's
independence from the Company. We also discussed with the Auditors matters
required to be discussed by the Statement on Auditing Standards No. 61
(Communication with Audit Committees) of the Auditing Standards Board
7
of the American Institute of Certified Public Accountants to the extent
applicable. We implemented a procedure to monitor auditor independence, reviewed
audit and non-audit services performed by the Auditors, and discussed with the
Auditors their independence.
Relying on the reviews and discussions referred to above, we recommended to
the Board of Directors that the Company's audited financial statements be
included in the Company's Annual Report on Form 10-K for the year ended December
31, 2004.
Audit Committee: Michael A.Callen (Chairman), Paul R. DeRosa, Lawton Swan, III,
David J. Willmott
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The following report is furnished by the Compensation Committee of the
Board of Directors
We, the Compensation Committee of the Board of Directors, have the primary
responsibility to set the Company's compensation principles that serve to guide
the design of compensation plans and programs applicable to employees at all
levels of the organization. In discharging our role, we periodically review the
competitiveness of the Company's compensation programs in order to evaluate
whether they are achieving their desired goals and objectives. We also review
the performance of the Company's executive officers and have established
individual compensation levels for each. The Compensation Committee is composed
entirely of independent, non-employee members of the Board of Directors. No
former employees of the Company serve on this committee.
The goal of the Company's compensation program is to attract, motivate and
retain highly talented individuals. With respect to the executive officers of
the Company, the Company's executive compensation program is principally
designed to give executives incentives to focus on and achieve the Company's
business objectives. Key elements of the compensation program are competitive
base salaries and annual performance-based bonuses, which seek to recognize
individual performance each year. The Company has, from time to time, granted
equity incentives in the form of stock purchase warrants that provide financial
rewards to executives if there is stock price appreciation over the period of
exercisability.
We review the compensation of executive officers at least annually in the
context of total compensation packages awarded to executives with similar
responsibilities at similar companies in the financial sector. The bonuses paid
to the executive officers in 2004 were intended to recognize accomplishments of
the Company and its subsidiaries in the past year. In addition, the Committee
recommended to the Board that the Company enter into employment agreements with
its executive officers.
Compensation of the Chairman and Chief Executive Officer: During 2004, the
Committee reviewed all components of the Chairman's compensation, including
salary, bonuses and benefits. In making its review, the Committee took into
account the Company's progress and performance in 2004 under the leadership of
the Chairman, noting that the Company reported earnings of $11.5 million and
assets of $1.3 billion, while continuing to maintain an efficiency ratio of 25%.
The Company also raised $30 million of capital through the issuance of trust
preferred securities and completed the leasing and renovation of new leased
premises. Based on this review and the Committee's recommendation to the Board,
the Company entered into an employment agreement with the Chairman and another
existing employment agreement between the Chairman and a Company subsidiary was
extended. Those employment agreements, which are summarized in this proxy
statement, establish a base salary for the term of the agreements and specify
certain benefits that are payable to the Chairman. The agreements also allow for
the payment of incentive compensation at the discretion of the Board. For 2004,
bonuses in the total amount of $300,000 were paid to the Chairman to recognize
his performance and in particular his additional efforts associated with
increasing capital and securing new office space as noted above. The Committee
finds the total compensation paid to the Chairman in the aggregate in 2004 to be
reasonable and not excessive.
Compensation Committee: Wesley T. Wood (Chairman), Michael A. Callen, Paul R.
DeRosa
8
EXECUTIVE COMPENSATION SUMMARY TABLE
The following table sets forth information concerning total compensation
paid during the last three years by the Company or its subsidiaries to the
Company's Chief Executive Officer and the four other most highly compensated
executive officers of the Company who served in such capacities as of December
31, 2004 for services rendered to the Company during each of the past three
fiscal years. Messrs. Olsen and Sullivan serve as Executive Officers of
Intervest National Bank but do not serve as Executive Officers of the Company.
Annual Compensation Long-Term Compensation
------------------- ----------------------
Name Other Annual
Principal Position Year Salary(1) Bonuses Compensation Awards Pay-Outs
- ------------------------------------------------------------------------------------------------------------------
JEROME DANSKER, 2004 $ 496,202 $ 300,000 ---- ---- ----
Chairman, 2003 $ 380,914 $ 10,000 ---- ---- ----
Chief Executive Officer 2002 $ 307,524 $ 150,000 ---- ---- ----
LOWELL S. DANSKER, 2004 $ 293,500 $ 25,000 ---- ---- ----
Vice Chairman, 2003 $ 177,722 $ 15,000 ---- ---- ----
President 2002 $ 93,575 ---- ---- ---- ----
KEITH A. OLSEN, 2004 $ 177,005 $ 10,000 ---- ---- ----
President - Florida Division 2003 $ 166,430 $ 10,000 ---- ---- ----
Intervest National Bank 2002 $ 133,413 $ 20,000 ---- ---- ----
LAWRENCE G. BERGMAN, 2004 $ 171,750 $ 25,000 ---- ---- ----
Vice President, 2003 $ 116,500 $ 7,500 ---- ---- ----
Secretary 2002 $ 91,400 $ ---- ---- ---- ----
RAYMOND C. SULLIVAN, 2004 $ 154,262 $ 10,000 ---- ---- ----
President 2003 $ 144,425 $ 7,500 ---- ---- ----
Intervest National Bank 2002 $ 127,688 $ 7,500 ---- ---- ----
- ------------------------------------------------------------------------------------------------------------------
(1) Includes Director and Committee fees, matching contributions under the
401(K) plan, unused vacation and unreimbursed medical expenses paid by the
Company and its subsidiaries.
AGGREGATED WARRANT GRANTS, EXCERCISES AND YEAR-END WARRANT VALUES
In 2004, no warrants, options or stock appreciation rights were granted to
or excercised by any of the officers named in the Executive Compensation Summary
Table above.
The following table contains information regarding the number of warrants
that are exercisable for shares of Class A and Class B Common Stock held by
Jerome Dansker. All the warrants are currently exercisable. No other officer
named in the Executive Compensation Summary Table above held warrants as of
December 31, 2004.
Number of Securities
Underlying Unexpired
Warrants at Year End Aggregate Value of
-------------------- Unexercised In-the
Class A Class B Money Warrants at
Shares Shares Year End
--------------------------------------------
501,465 195,000 $8,936,298
--------------------------------------------
The aggregate value of unexercised in-the money warrants at year end is
calculated by subtracting the exercise price from the fair market value of the
underlying shares. For purposes of this table, fair market value is deemed to be
$19.74 per share, the average of the high and low prices reported by NASDAQ for
the Company's Class A Common Stock transactions on December 31, 2004. There is
no established trading market for the Class B Common Stock. For purposes of this
table, the fair market value of the Class B Common Stock is also deemed to be
$19.74 per share. The Class B Common Stock is convertible into Class A Common
Stock on a share for share basis.
9
EQUITY COMPENSATION PLAN INFORMATION
The table below summarizes information as of December 31, 2004
relating to equity compensation plans of the Company pursuant to which rights to
acquire shares of Class A and Class B Common Stock have been granted. All of the
rights were granted before 2001.
Number of shares to be Weighted-average Number of securities
issued upon exercise of exercise price of remaining available
outstanding warrants outstanding warrants for future issuance
Class A (1) Class B (1) Class A Class B Class A Class B
- -------------------------------------------------------------------------------------------------------------------------
Plans approved by
shareholders 501,465 195,000 $ 6.67 $ 7.52 ---- ----
Plans not approved by
shareholders ---- ---- ---- ---- ---- ----
- -------------------------------------------------------------------------------------------------------------------------
(1) The rights consist of warrants to purchase shares of Class A and B
Common Stock issued to the Chairman of the Company, the grant of which was
ratified by the shareholders of the Company.
EMPLOYMENT AGREEMENTS
The Company has employment and supplemental benefits agreements with Jerome
Dansker, Lowell S. Dansker and Lawrence G. Bergman that expire June 30, 2014.
The agreements provide for annual salaries in the present amount of $200,000,
$185,000 and $165,000, respectively. The salaries are subject to increase
annually as of July 1 of each year by the greater of: six percent; the
percentage increase in the consumer price index; or .015% of the Company's asset
increase from the prior year ending June 30th provided the Company had net
income in such twelve-month period. The agreements also provide for bonuses,
vacation, monthly expense payments, the use of a car in the case of Mr. Lowell
Dansker, the use of office space, and entitlement to participate in the
Company's employee benefit programs, such as medical insurance, life insurance
and 401k plan. The agreements also include death and disability benefits that
provide for the payment, for a specified period, of a portion of the salary
entitlements to the employee or his estate in the event of death or disability.
Intervest Mortgage Corporation, the Company's wholly owned subsidiary, has
an employment and supplemental benefit agreement with Jerome Dansker that
expires June 30, 2014. This agreement provides for an annual salary in the
present amount of $211,185, which is subject to increase annually on July 1 of
each year by six percent or by the percentage increase in the consumer price
index, if higher. The agreement also provides for monthly expense payments, the
use of a car and office space, medical benefits and vacation. In the event of
Mr. Dansker's death or disability, monthly payments of one-half of the amount
which would otherwise have been paid to Mr. Dansker will continue until the
longer of (i) the balance of the term of employment, or (ii) three years. The
agreement also provides for additional compensation of $1,000 per month for each
$10 million of gross assets of Intervest Mortgage Corporation in excess of $100
million.
Intervest National Bank, the Company's wholly owned subsidiary, has
employment agreements with Keith A. Olsen and Raymond C. Sullivan that expire on
December 31, 2005. The agreements are renewable under the same terms and
conditions from year to year with the written consent from both the executive
and Intervest National Bank. The agreements provide for base salaries in the
amount of $180,000 and $157,500, respectively, for 2005, and also provide for
expense reimbursements, medical and life insurance benefits, 401k benefits,
bonuses and vacation, and for the payment of severance in certain instances upon
termination of employment.
Intervest National Bank also has an employment agreement with its Senior
Vice President and Chief Financial Officer, John J. Arvonio, and Intervest
Mortgage Corporation also has an employment agreement with its Vice President
and Controller, John H. Hoffmann. The agreements, except for base salaries, are
similar to those of Mr. Olsen and Mr. Sullivan.
10
STOCK PERFORMANCE GRAPH
The following stock performance graph compares the cumulative total
shareholder return of the Company's Class A Common Stock against the cumulative
total return of the Nasdaq Stock Market (U.S. companies) Index, an index for
banks with total assets of $500 million to $1 billion, an index for banks with
total assets of $1 billion to $5 billion, and the Nasdaq Bank index. Commencing
this year, the Company has elected to include the index for banks with total
assets of $1 billion to $5 billion as a result of the growth in the Company's
total assets.
The stock performance graph was prepared by SNL Financial L.C. and assumes
that $100 was invested on December 31, 1999. The points marked on the horizontal
axis correspond to December 31 of each year. Each of the referenced indices is
calculated in the same manner.
TOTAL RETURN PERFORMANCE
[GRAPHIC OMITTED]
PERIOD ENDING
----------------------------------------------------------
INDEX 12/31/99 12/31/00 12/31/01 12/31/02 12/31/03 12/31/04
- --------------------------------------------------------------------------------------------
Intervest Bancshares Corporation 100.00 60.00 118.40 172.80 234.40 315.82
NASDAQ Composite 100.00 60.82 48.16 33.11 49.93 54.49
SNL $500M-$1B Bank Index 100.00 95.72 124.18 158.54 228.61 259.07
SNL $1B-$5B Bank Index 100.00 113.48 137.88 159.16 216.44 267.12
SNL NASDAQ Bank Index 100.00 115.45 125.66 129.25 166.83 191.21
11
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Intervest National Bank, the Company's wholly owned subsidiary, has had
various loan and other banking transactions in the ordinary course of business
with Directors and executive officers of the Company and its subsidiaries (or
associates of such persons). In the opinion of management, all such
transactions: (i) have been and will be made in the ordinary course of business,
(ii) have been and will be made on substantially the same terms, including
interest rates and collateral on loans, as those generally prevailing at the
time for comparable transactions with unrelated persons, and (iii) have not and
will not involve more than the normal risk of collectability or present other
unfavorable features. There were no loans outstanding or made to any Directors
or executive officers in 2004.
The Company, its Directors and entities affiliated with certain Directors
of the Company, have in the past and may in the future participate in mortgage
loans originated by the Company's subsidiaries. Such participations are on
substantially the same terms as would apply for comparable transactions with
other persons and the interest of the participants in the collateral securing
those loans is pari passu with such subsidiaries. At December 31, 2004, there
were no such transactions outstanding.
Mr. Wayne F. Holly, a Director of the Company, is the Chairman and
President of Sage, Rutty & Co., Inc., which firm has acted as underwriter or
placement agent from time to time in connection with securities offerings of the
Company and those of Intervest Mortgage Corporation, the Company's wholly owned
subsidiary. Intervest National Bank, the Company's wholly owned subsidiary, also
uses such firm to purchase investment securities. Intervest Mortgage
Corporation paid commissions and fees to Sage, Rutty & Co., Inc., in connection
with the placement of debentures of approximately $680,000 in 2004. Intervest
National Bank paid commissions to Sage, Rutty & Co., Inc., of approximately of
$69,000 in 2004 in connection with the purchase of securities.
Mr. Thomas E. Willett, Esq., a Director of the Company, is a partner in the
law firm of Harris Beach PLLC, which firm provides legal services to the Company
and its subsidiaries. The total fees paid by the Company to Harris Beach PLLC in
2004 were less than 5% of that firm's gross revenues for that firm's last full
fiscal year.
Except for the transactions described above and outside of normal customer
relationships, none of the Directors, officers or principal shareholders of the
Company and no corporations or firms with such persons or entities are
associated, currently maintains or has maintained since the beginning of the
last fiscal year, any significant business or personal relationship with the
Company or with its subsidiaries other than such as arises by virtue of such
position or ownership interest in the Company.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers, Directors and persons who beneficially own more than 10% of
the Company's Common Stock to file initial reports of ownership and reports of
changes in ownership with the SEC. Such persons are required by SEC regulations
to furnish the Company with copies of all Section 16(a) forms filed by such
persons.
Based solely on the Company's review of such forms furnished to the Company
and written representations from certain reporting persons, the Company believes
that all filing requirements applicable to the Company's executive officers,
Directors and more than 10% stockholders were satisfied, except that one sale
transaction executed by Mr. Bergman was filed late on Form 4. The sale was
pursuant to a Rule 10b5-1 Plan and was subsequently reported on Form 4.
12
INDEPENDENT PUBLIC ACCOUNTANTS
APPOINTMENT OF AUDITORS
The Audit Committee of the Board of Directors appointed the firm of Hacker,
Johnson & Smith P.A., P.C. as the Company's principal independent auditors for
the year ending December 31, 2005.
The Company has been advised by Hacker, Johnson & Smith P.A., P.C. that
neither the firm nor any of its associates has any relationship with the Company
or its subsidiaries other than the usual relationship that exists between
independent public accountants and clients. Representatives from that firm are
not expected to be present at the Annual Meeting.
AUDIT FEES
Hacker, Johnson & Smith, P.A. billed the Company and its wholly owned
subsidiary, Intervest National Bank, a total of $72,000 in 2004 and $67,000 in
2003 for the audit of the Company's annual financial statements for the years
ended December 31, 2004 and 2003 and for the review of the financial statements
included in the Company's Quarterly Reports on Form 10-Q filed during 2004 and
2003.
Intervest Mortgage Corporation, the Company's wholly owned subsidiary, was
billed by its auditors, Eisner LLP, $45,600 in 2004 and $29,700 in 2003 for the
audit of its annual financial statements for the years ended December 31, 2004
and 2003 and for the review of its financial statements included in Intervest
Mortgage Corporation's Quarterly Reports on Form 10-Q filed during 2004 and
2003. Hacker, Johnson & Smith, P.A., P.C. relies upon the reports of the
independent auditors of Intervest Mortgage Corporation in its reports.
TAX FEES
The aggregate amount of fees billed by Hacker, Johnson & Smith, P.A., P.C.
for services in connection with the preparation of the Company's income tax
returns amounted to $11,000 for 2004 and $12,850 for 2003.
ALL OTHER FEES
The aggregate amount of fees billed by Eisner LLP for all other services
rendered to Intervest Mortgage Corporation amounted to $28,000 for 2004 and
$22,800 for 2003. These services consisted of the review of Intervest Mortgage
Corporation's registration statements filed in 2004 and 2003 related to the
issuance of its subordinated debentures. Hacker, Johnson & Smith, P.A., P.C. did
not perform any other services for the Company.
OTHER MATTERS
The Audit Committee of the Board of Directors has determined that the
provision of non-audit services as described above is compatible with
maintaining the independence of the Company's principal accountants. Of the time
expended by the Company's principal accountants to audit the Company's financial
statements for the fiscal year ended December 31, 2004, less than 50% of such
time involved work performed by persons other than the principal accountant's
full-time, permanent employees.
STOCKHOLDER PROPOSALS TO BE PRESENTED AT NEXT ANNUAL MEETING
Proposals of stockholders intended to be presented at the next annual
meeting of stockholders of the Company must (i) be received by the Company at
its offices at One Rockefeller Plaza (Suite 400) New York, New York 10020 no
later than December 23, 2005 and must (ii) satisfy the conditions established by
the SEC for stockholder proposals to be included in the Company's Proxy
Statement for that meeting. The persons named in the proxies distributed by the
Company may use their discretion in voting proxies with respect to shareholder
proposals not included in the proxy statement for the 2006 annual meeting,
unless the Company received notice of such proposals prior to March 7, 2006.
13
OTHER MATTERS
The cost of solicitation of the proxies will be borne by the Company. In
addition to the solicitation of proxies by mail, the Company, through its
directors, officers and regular employees, may also solicit proxies personally
or by telephone, telegraph or fax. The Company will request persons, firms and
corporations holding shares of Common Stock in their names or in the names of
their nominees, which are beneficially owned by others, to send proxy material
to and obtain proxies from such beneficial owners and will reimburse such
holders for their reasonable expenses in doing so.
As of this date, the Board of Directors does not know of any business to be
brought before the meeting other than as specified above. However, if any other
matters properly come before the meeting, it is the intention of the persons
named in the enclosed proxy to vote in such manner as may be determined by a
majority of the Board of Directors or its Executive Committee.
Copies of the 2004 Annual Report of the Company are included in this
mailing to stockholders. Additional copies of the Company's 2004 Annual Report
may be obtained by written request by writing to Intervest Bancshares
Corporation, Attention: Secretary, One Rockefeller Plaza (Suite 400) New York,
New York 10020.
By Order of the Board of Directors,
Lawrence G. Bergman
Secretary
Dated: April 21, 2005
A COPY OF THE ANNUAL REPORT OF THE COMPANY ON FORM 10-K FOR ITS MOST RECENT
FISCAL YEAR, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WILL BE
FURNISHED UPON REQUEST AND WITHOUT CHARGE TO BENEFICIAL HOLDERS OF THE CLASS A
COMMON STOCK OF THE COMPANY. WRITTEN REQUESTS SHOULD BE DIRECTED TO: INTERVEST
BANCSHARES CORPORATION, ATTENTION: SECRETARY, ONE ROCKEFELLER PLAZA (SUITE 400)
NEW YORK, NEW YORK 10020. TELEPHONE INQUIRIES SHOULD BE DIRECTED TO (212)
218-2800.
14
PROXY INTERVEST BANCSHARES CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS
ANNUAL MEETING OF SHAREHOLDERS ON MAY 26, 2005
The undersigned, revoking any proxy heretofore given, hereby constitutes
and appoints Lawrence G. Bergman, Jerome Dansker and Lowell S. Dansker, or any
of them, proxies of the undersigned, each with full power of substitution, to
vote all shares of Class A Common Stock of INTERVEST BANCSHARES CORPORATION (the
"Company") which the undersigned is entitled to vote at the Annual Meeting of
Shareholders to be held Thursday, May 26, 2005 at 9:30 A.M. local time (the
"Annual Meeting"), and at any adjournment or postponement thereof, as
hereinafter specified with respect to the following proposals, more fully
described in the Notice of and Proxy Statement for the Annual Meeting, receipt
of which is hereby acknowledged. The Board of Directors recommends a vote FOR
all of the director nominees.
DIRECTOR NOMINEES:
Michael A. Callen, Wayne F. Holly, Lawton Swan, III
WITHHELD To withhold authority to vote
FOR all nominees for all for any individual nominee,
listed above Nominees print the name(s) on the lines
below.
1. Election of [ ] [ ] ------------------------------
Directors ------------------------------
------------------------------
------------------------------
------------------------------
------------------------------
2. In their discretion, upon any other business
which may properly come before the Annual
Meeting or any adjournment or postponement
thereof.
THE SHARES REPRESENTED BY THIS PROXY WILL BE
VOTED FOR THE PROPOSAL SET FORTH HEREIN UNLESS
---
A CONTRARY CHOICE IS SPECIFIED. SAID PROXIES WILL
USE THEIR DISCRETION WITH RESPECT TO ANY OTHER
MATTERS WHICH PROPERLY COME BEFORE THE ANNUAL
MEETING OR ANY ADJOURNMENT THEREOF.
Signature ___________________ Date _________ Signature __________Date _________
Note: (Please sign exactly as name appears hereon. For joint accounts, each
joint owner should sign. Executors, administrators, trustees, etc. should so
indicate when signing).
COMPLETE, DATE, SIGN AND MAIL THIS PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE.