SCHEDULE 14(A) 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
[ ] Definitive Proxy Statement [ ] Confidential, for Use of the
[ ] Definitive Additional Materials Commission only (as
[X] Soliciting Material Under Rule 14a - 12 permitted by Rule 14a-6(e)(2))
FIRST AMERICAN CAPITAL CORPORATION
Attn: Harland Priddle, Chairman
1303 S.W. First American Place
Topeka, Kansas 66604
Phone: 785/267-7077
with a copy to William Schutte, Esq.
Polsinelli, Shalton & Welte, P.C.
6201 College Boulevard, Suite 500
Overland Park, Kansas 66211
Phone: 913/451-8788
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
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May 2, 2003
Dear Fellow Shareholder:
I am writing to alert you to an important development concerning First
American Capital Corporation's 2003 Annual Meeting. A group calling
itself the "First American Committee for the Protection of Shareholder
Value" is attempting to take control of your Board of Directors and is
soliciting proxies for the election of its own slate of directors. The
current Board does not believe that such a change would be in your best
interests.
The group seeking to take control of the Board is headed and funded by
Citizens, Inc., an Austin, Texas-based insurance holding company. In
December 2002, Citizens made an unsolicited offer to acquire First
American, but withdrew its offer when your Board requested a provision
in the acquisition agreement that would have permitted us to test whether
the Citizens' offer represented the best alternative available to the
First American shareholders. In recent filings with the Securities
and Exchange Commission, Citizens disclosed its continuing interest
in acquiring First American. Although Citizens owns directly no shares
of First American common stock, it has acquired, in building up to its
proxy solicitation, the right to vote on a shared basis 658,320 shares
of First American common stock. Voting power was secured for most of
these shares when two former First American executives, Michael Fink
and Rickie Meyer, granted irrevocable proxies to the president of
Citizens. As you will recall, Mr. Fink was the chairman of the board
of First American from its inception in 1996 until November 2002,
when the Board did not renew his contract. Mr. Meyer was First
American's president from its inception until February 2003, when the
Board did not renew his contract. Mr. Meyer and Mr. Fink now have
employment or consulting relationships with Citizens.
WE OPPOSE THE CITIZENS GROUP SOLICITATION AND URGE THAT YOU NOT SIGN
THE WHITE PROXY CARD SENT TO YOU BY THE CITIZENS GROUP.
While the Citizens group states in its proxy materials that it will
consider all alternatives to maximize shareholder value, your Board
believes that the group's proxy solicitation is the next step in
Citizens' effort to acquire First American on terms favorable to Citizens.
Your Board believes that a number of options and alternatives are
available to First American in building shareholder value. The Board's
nominees are, in our view, in the best position to assess and evaluate
alternatives to enhancing shareholder value, including a sale of First
American to a third party if warranted.
In your mail, you will soon be receiving First American's Proxy
Statement and Blue Proxy Card for the June 2, 2003 Annual Meeting.
First American's Proxy Statement advances a slate of highly
experienced and respected businessmen to serve as Directors for
your company:
Paul E. "Bud" Burke
Edward C. Carter
Kenneth L. Frahm
Stephen J. Irsik, Jr.
John G. Montgomery
Harland E. Priddle
Gary E. Yager
Thomas M. Fogt
About the same time, you will be receiving a different proxy card
from Citizens advancing its own candidates. In the Citizens' proxy
materials are numerous claims made against your Board and First
American's current management team in an effort to sway your vote
to this alternate group of individuals.
Before you decide, we want you to know the following:
In evaluating Citizens' proposal, the Board could not fulfill its
duty to the shareholders to act in an informed manner without
requiring a "market check" provision in the acquisition agreement.
Citizens twice refused First American's request to include a
"market check" provision into the terms of the acquisition that
would have allowed your Board of Directors to independently
evaluate whether the Citizens' offer represented the best
alternative that could be obtained by the shareholders. Whether
or not you believe selling First American would have been the right
thing to do, doesn't it make sense that the Board would want to
have an understanding of First American's value, the relationship
of Citizens' bid to that value, and whether the Citizens' offer
was the best available alternative, before recommending the
transaction to the shareholders?
For most shareholders, the Citizens' offer would not have allowed
for a return of their initial investment.
If the original Citizens transaction had taken place either time
at the valuations proposed, nearly all (almost 98 percent) of our
shareholders would have recognized a 30 percent loss on their
original investments.
Five of the eight Citizens group nominees have a financial
relationship with Citizens.
A majority of the Citizens group nominees are associated with
Citizens either as a shareholder, executive officer, employee or
consultant. In any future dealings between First American and
Citizens, can these nominees be expected to act in the best interest
of First American and its shareholders? The Board thinks they will
not.
* As compared with the Citizens group nominees, your current management
and the Board nominees listed on the Blue Proxy Card are in the best
position to determine First American's future direction and to represent
your best interests.
By not short-changing their obligation to consider the Citizens'
proposal in an informed manner, the Board members demonstrated their
commitment to fulfilling their fiduciary duty to all shareholders of
First American - without regard to each board member's personal
financial interest. Unlike those shareholders that invested in First
American's public offering and who paid $5.00 per share for their
stock, the Board members (who, like the other founders, bought their
shares at a price of $.10 per share) would have realized a significant
financial benefit from the proposed business combination with Citizens.
The Board's nominees will continue to put the financial interests of all
of our shareholders ahead of their personal interests.
Please watch your mail for the First American Proxy Statement and
Blue Proxy Card and return it promptly in accordance with the
instructions on the Blue Proxy Card.
Sincerely,
Harland E. Priddle
Chairman of the Board
First American Capital Corporation
ADDITIONAL INFORMATION
On April 28, 2003, First American filed a preliminary proxy statement
with the Securities and Exchange Commission relating to First American's
solicitation of proxies from the shareholders of First American with
respect to the First American 2003 Annual Meeting of Shareholders.
First American will file with the Commission, and will furnish to First
American shareholders, a definitive proxy statement and may file other
proxy solicitation materials. FIRST AMERICAN ADVISES SECURITY HOLDERS
TO READ ITS DEFINITIVE PROXY STATEMENT WHEN IT BECOMES AVAILABLE,
BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION.
First American's proxy statement and other relevant documents will
be available for free at www.sec.gov. You may also obtain a free
copy of First American's definitive proxy statement, when it becomes
available, by writing to First American at 1303 S.W. First American
Place, Topeka, Kansas 66604. Detailed information regarding the names,
affiliation and interest of individuals who may be deemed participants
in the solicitation of proxies of First American's shareholders is
provided below and is available in solicitation materials on Schedule
14(A) filed by First American with the SEC.
First American and certain directors of First American may be deemed
participants in the solicitation of proxies in respect of electing the
Board of Directors of First American at the 2003 Annual Meeting of
Shareholders of First American. Those directors of First American are
Paul E. Burke, Jr., Edward C. Carter, Kenneth J. Frahm, Stephen J.
Irsik, Jr., John G. Montgomery, Harland E. Priddle, Gary E. Yeager and
Thomas M. Fogt. Additional information with respect to the beneficial
ownership of those directors of First American's common stock is set
forth in the preliminary proxy statement filed by First American on
April 28, 2003.
LEGAL NOTICE REGARDING FORWARD-LOOKING STATEMENTS
Statements in this notice that are not historical are forward-looking
statements, including statements regarding First American's beliefs,
expectations, hopes or intentions regarding the future. It important
to note that actual outcomes and First American's actual results could
differ materially from forward-looking statements. First American
assumes no obligation to update any forward-looking statement.