SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
(X) Preliminary Proxy Statement ( ) Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
( ) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
UWHARRIE CAPITAL CORP
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
(X) No fee required
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
PRELIMINARY PROXY
UWHARRIE CAPITAL CORP
134 NORTH FIRST STREET
ALBEMARLE, NORTH CAROLINA167 North Second Street
Albemarle, North Carolina 28001
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE is hereby given that the Annual Meeting of Shareholders of
Uwharrie Capital Corp (the "Company") will be held as follows:
PLACE:Place: Stanly County Agri-Civic Center
26032 Newt Road
Albemarle, North Carolina
DATE:Date: Tuesday, April 27, 1999
TIME:May 2, 2000
Time: 4:00 p.m. - Business Meeting
5:30 p.m. - Dinner
The purposes of the meeting are:
1. To elect six directors of the Company;
2. To amend the Articles of Incorporation to increaseauthorize the
authorized
numberissuance of shares of the Company's common stock from 6,000,000 to
20,000,000;preferred stock.
3. To amend the Employee Stock Option Plan to increase the number of
shares available for grant;
4. To ratify the appointment of Dixon Odom PLLC as the Company's
independent public accountants for 1999;2000; and
5.4. To transact such other business as may properly be presented
for action at the meeting.
YOU ARE INVITED TO ATTEND THE ANNUAL MEETING IN PERSON. HOWEVER, EVEN
IF YOU PLAN TO ATTEND, YOU ARE REQUESTED TO COMPLETE, SIGN AND DATE THE ENCLOSED
APPOINTMENT OF PROXY AND RETURN IT PROMPTLY IN THE ENVELOPE PROVIDED FOR THAT
PURPOSE TO ENSURE THAT A QUORUM IS PRESENT AT THE MEETING. THE GIVING OF AN
APPOINTMENT OF PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE IT OR TO ATTEND THE
MEETING AND VOTE IN PERSON.
BY ORDER OF THE BOARD OF DIRECTORS
ROGERBy Order of the Board of Directors
Roger L. DICK
PRESIDENT AND CHIEF EXECUTIVE OFFICER
MARCH 30, 1999Dick
Chief Executive Officer
April 7, 2000
UWHARRIE CAPITAL CORP
134 NORTH FIRST STREET
ALBEMARLE, NORTH CAROLINA167 North Second Street
Albemarle, North Carolina 28001
(704) 982-4415983-6181
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
This Proxy Statement is being furnished in connection with the
solicitation by the Board of Directors of Uwharrie Capital Corp (the "Company")
of appointments of proxy for use at the annual meeting of the Company's
shareholders (the "Annual Meeting") to be held on Tuesday, April 27, 1999,May 2, 2000, at 4:00
p.m., in the Stanly County Agri-Civic Center, 26032 Newt Road, Albemarle, North
Carolina, and at any adjournments thereof. The Company's proxy solicitation
materials are being mailed to shareholders on or about March 30,
1999. In this Proxy Statement, the Company's subsidiary bank, BankApril 7, 2000.
Voting of Stanly, is
referred to as the "Bank".
VOTING OF PROXIESProxies
Persons named in the enclosed appointment of proxy as proxies (the
"Proxies") to represent shareholders at the Annual Meeting are Roger L. Dick,
Dawn L. MeltonRon B. Davis and Tamara M. Singletary.Chris A. Whitfield. Shares represented by each appointment of
proxy which is properly executed, returned and not revoked, will be voted in
accordance with the directions contained therein. If no directions are given,
such shares will be voted "FOR" the election of each of the six nominees for
director named in Proposal 1, and "FOR" Proposals 2 3 and 4.3. If, at or before the
time of the Annual Meeting, any nominee named in Proposal 1 has become
unavailable for any reason, the proxies will be authorized to vote for a
substitute nominee. On such other matters as may come before the meeting, the
proxies will be authorized to vote in accordance with their best judgment.
RECORD DATERecord Date
The close of business on March 17, 1999,15, 2000, has been fixed as the record
date (the "Record Date") for the determination of shareholders entitled to
notice of and to vote at the Annual Meeting. Only those shareholders of record
on that date will be eligible to vote on the proposals described herein.
VOTING SECURITIESVoting Securities
The Company's voting securities are the shares of its common stock, par
value $1.25 per share, of which ___________5,545,597 shares were issued and outstanding on
the Record Date.
VOTING PROCEDURES; VOTES REQUIRED FOR APPROVALDecember 31, 1999.
Voting Procedures; Votes Required for Approval
At the Annual Meeting, each shareholder will be entitled to one vote
for each share held of record on the Record Date on each matter submitted for
voting and, in the election of directors, for each director to be elected. In
accordance with North Carolina law, shareholders
will not be entitled to vote cumulatively in the election of directors. In the
election of directors, the six nominees receiving the highest number of votes
will be elected.
For ProposalsProposal 2 3to be approved, the proposal must be approved by a
majority of the shares entitled to vote at the Annual Meeting on such proposal.
Abstentions and 4broker nonvotes will have the same effect as a vote against the
proposal.
For Proposal 3 to be approved, a majority of the shares represented in
person and by proxy and entitled to vote at the Annual Meeting must be voted in
favor of approval. Abstentions and broker nonvotes will have no effect in the
voting at the Annual Meeting.
REVOCATION OF APPOINTMENT OF PROXYon this proposal.
Revocation of Appointment of Proxy
Any shareholder who executes an appointment of proxy has the right to
revoke it at any time before it is exercised by filing with the Secretary of the
Company either an instrument revoking it or a duly executed appointment of proxy
bearing a later date, or by attending the Annual Meeting and announcing his or
her intention to vote in person.
EXPENSES OF SOLICITATIONExpenses of Solicitation
The Company will pay the cost of preparing, assembling and mailing this
Proxy Statement. Appointments of proxy also may be solicited personally or by
telephone by the Company's and the Bank's directors, officers and employees
without additional compensation. BENEFICIAL OWNERSHIP OF SECURITIES BY MANAGEMENT AND NOMINEESThe Company will reimburse banks, brokers and
other custodians, nominees and fiduciaries for their costs in sending the proxy
materials to beneficial owners.
Beneficial Ownership of Securities by Management and Nominees
As of February 12,December 31, 1999, there were no persons who were known to
management of the Company to beneficially own more than 5% of the Company's
common stock. The following table lists the individual beneficial ownership of
the Company's common stock as of February 12,December 31, 1999, by the Company's current
directors and nominees for director, by the Company's executive officers named
in the Summary Compensation Table below, and by all current directors, nominees
and executive officers of the Company as a group. No current director or
executive officer owned more than 1% of the shares outstanding on February 12,December 31,
1999. Current directors, nominees and executive officers as a group beneficially
owned 9.35%8.19% of the shares outstanding or options exercisable by members of the
group on such date.
NAME OF AMOUNT AND NATURE OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIPName of Amount and Nature of
Beneficial Owner Beneficial Ownership (1,2)
William S. Aldridge, Jr. 7,254- ---------------- --------------------------
Cynthia H. Beane 20,98421,613
Joe S. Brooks 17,84818,382
Ronald T. Burleson 15,93216,923
Bill C. Burnside, D.D.S. 9,5959,880
Gail C. Burris 800
Ronald B. Davis 40,852
G. Chad Efird 22,4701,236
2
Name of Amount and Nature of
Beneficial Owner Beneficial Ownership (1,2)
- ---------------- --------------------------
David M. Jones, D.V.M. 1,0002,060
Kyle H. Josey 400412
James F. Link, D.V.M. 10,72011,041
Joyce H. Little 400707
W. Chester Lowder 1,648
2
NAME OF AMOUNT AND NATURE OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP (1,2)2,727
Buren Mullis 30,00030,900
John P. Murray, M.D. 15,32615,785
Kent E. Newport 2,2983,396
Catherine A. Pickler 2,7542,836
George T. Reaves 8,0508,291
A. James Russell 1,2042,269
B. A. Smith, Jr. 36,17837,931
Douglas V. Waddell 806830
Roger L. Dick 46,36480,083
All current directors, nominees for director 454,417
and executive officers as a 482,416 group (21 persons)(3)
group (30 persons)- -------------
(1) Except as otherwise noted, to the best knowledge of management of the
Company, the individuals named or included in the group above exercise
sole voting and investment power with respect to all shares shown as
beneficially owned. The calculations of the percentage of class
beneficially owned by each individual are based on a total of 4,941,1275,545,597
shares currently outstanding as of February 12, 1999, plus the number of shares capable of being
issued to that individual (if any) within 60 days upon the exercise of
stock options held by that individual (if any).
(2) Includes shares over which the named individual shares voting and
investment power as follows: Mr. Aldridge - 6,050 shares; Ms. Beane - 20,04620,647 shares; Mr. Brooks -
7,4287,650 shares; Mr. Burleson - 2,5883,179 shares; Dr. Burnside - 9,1959,468 shares;
Ms. Burris - 412 shares; Mr. Efird - 21,766 shares; Dr. Link - 8,8009,064 shares; Mr. Lowder - 1,2042,270
shares; Dr. Murray - 11,68212,032 shares; Mr. Newport -868- 1,924 shares; Mr.
Russell - 364374 shares; Mr. Smith - 31,97232,931 shares.
(3) Includes a total of 102,60498,504 shares as to which the persons included in
the group exercise sole voting and investment power, and 161,45899,951 shares
as to which such power is shared. Also includes an aggregate of 218,354255,962
shares which executive officers included in the group could purchase
under currently exercisable stock options.
REPORTS OF CHANGES IN BENEFICIAL OWNERSHIPReports of Changes in Beneficial Ownership
Directors and executive officers of the Company are required by federal
law to file reports with the Securities and Exchange Commission regarding the
amount of and changes in their beneficial ownership of the Company's common
stock. To the knowledge of the management of the Company based upon information
supplied to the Company by the directors and executive officers, all required
reports of directors and executive officers of the Company have been timely
filed.
3
PROPOSAL 1: ELECTION OF DIRECTORS
NOMINEESNominees
The Company's Bylaws provide for a Board of Directors composed of 18
members divided into three classes, each consisting of six directors who are
elected to terms of three years. Each year the terms of six directors expire and
six persons are elected as directors for new three-year terms. The Board of
Directors intends to nominate the six persons named below for election by
shareholders at the Annual Meeting as directors of the Company for three-year
terms or until their respective successors are duly elected and qualified.
YEAR IN WHICH
POSITIONS FIRST ELECTED/
PRINCIPAL OCCUPATION
WITH PROPOSED AND BUSINESS EXPERIENCEPRINCIPAL OCCUPATION
NAME AND AGE COMPANY TERM EXPIRES AND BUSINESS EXPERIENCE FOR PAST 5 YEARS
- ------------ ------- - ------------ ----------------
Cynthia H. Beane
Joe S. Brooks Director 1996 / 2002 Cynthia H. Beane, CPA,1997/2003 Partner, Brothers Precision Tool Company,
(50) Albemarle, NC (50) (certified public accountant)
Kyle H. Josey New Nominee ---- / 2002 Owner, Josey(tool and die shop)
Ronald T. Burleson Director 1997/2003 Partner, Thurman Burleson & Josey Accounting
(47) Services, Albemarle, NC
Joyce H. Little New Nominee ---- / 2002 Vice President/Secretary/Treasurer,
(57) Wiley Little Drywall, Inc.; Mayor,
Oakboro, NC
W. Chester Lowder Director 1995 / 2002 Director of Dairy and Beef ProgramsSons Farm, Richfield,
(50) and Assistant Director of Natural
Resources, North Carolina Farm
Bureau Federation, Raleigh, NC
(agricultural service agency);
President, Fork "L" Farm, Inc.,
Norwood, NC (farming operation)
B. A. Smith, Jr.James F. Link, D.V.M. Director 1996 / 20021997/2003 Veterinarian and Owner, North Stanly Animal
(47) Clinic, New London, NC
Kent E. Newport Director 1997/2003 President, KDC, Inc. DBA Coy's Laundromat,
(39) Albemarle, NC (coin laundry and self-service
carwash)
George T. Reaves Director 1997/2003 Retired; previously, PilotVice President Traffic and
Base
(65) Commander, United States Air Force
Douglas V. Waddell Director 1995 / 2002 Retired; previously, Manager, Sears
(70)(72) Transportation, Collins & Roebuck - Automotive Department,Aikman Corporation,
Albemarle, NC (retail store)(manufacturer of automotive fabrics,
upholstery, yarns)
A. James Russell Director 1997/2003 Construction Manager, J.T. Russell & Sons, Inc.,
(45) Albemarle, NC (highway heavy utility construction)
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" EACH OF THE
NOMINEES NAMED ABOVEABOVE.
4
INCUMBENT DIRECTORSIncumbent Directors
The Company's current Board of Directors includes 12 directors whose
terms will continue after the Annual Meeting. The following table contains
information about those 12 incumbent directors.
YEAR IN WHICH
POSITIONS FIRST ELECTED/
WITH CURRENT TERM PRINCIPAL OCCUPATION
NAME AND AGE COMPANY EXPIRES (1) AND BUSINESS EXPERIENCE FOR THE PAST 5 YEARS
------------- ------------ ----------------------------------------
Joe S. Brooks 1997/2000 Partner, Brothers Precision Tool
(49) Company,
Cynthia H. Beane Director 1996/2002 Cynthia H. Beane, CPA, Albemarle, NC (tool and die
shop)
Ronald T. Burleson 1997/2000 Partner, Thurman Burleson & Sons Farm,
(49) Richfield, NC (farming operation)(certified
(51) public accountant)
Bill C. Burnside, D.D.S. Director 1998/2001 Bill Burnside, D.D.S., Albemarle, NC
D.D.S. (49)(50) (dentistry)
Gail C. Burris Director 1998/2001 Owner and Manager, Rosebriar Restaurant, (44) Albemarle, NC
(45)
David M. Jones, D.V.M. Director 1998/2001 Director, North Carolina Zoological (54) Park, Asheboro,
(55) NC (NC Department of Environment and Natural
Resources) James F. Link, D.V.M. 1997/2000 Veterinariansince March 1994; previously, Director of
Conservation and Consultancy, Zoological Society of
London, London, England
Kyle H. Josey Director 2000/2002 Owner, Josey & Josey Accounting Services, Albemarle,
(48) NC
Joyce H. Little Director 2000/2002 Vice President/Secretary/Treasurer, Wiley Little
(57) Drywall, Inc.; Mayor, Oakboro, NC
W. Chester Lowder Director 1995/2002 Director of Dairy and Beef Services, North Stanly
(46) Animal Clinic, New London,Carolina
(51) Farm Bureau Federation, Raleigh, NC (agricultural
service agency); President, Fork "L" Farm, Inc.,
Norwood, NC (farming operation)
Buren Mullis Director 1998/2001 Retired; previously, Vice President and (65) General
(66) Manager of Sundrop Bottling Co., Inc., Concord, NC
John P. Murray, M.D. Director 1996/2001 Retired; previously, Physician and (57) Owner,owner, Albemarle
(58) Ear, Nose and Throat, Albemarle, NC
Kent E. Newport 1997/2000 President, KDC, Inc. DBA Coy's
(38) Laundromat, Albemarle, NC (coin laundry
and self-service carwash)
Catherine A. Pickler Director 1995/2001 Homemaker and community volunteer, New (64) London, NC
George T. Reaves 1997/2000(65)
B.A. Smith, Jr. Director 1996/2002 Retired; previously, Vice President,Pilot and Base Commander, United
(66) States Air Force
Douglas V. Waddell Director 1995/2002 Retired; previously, Manager, Sears & Roebuck -
(71) Traffic and Transportation, Collins &
Aikman Corp.,Automotive Department, Albemarle, NC (manufacturer of automotive fabrics,
upholstery, yarns)
A. James Russell 1997/2000 Construction Manager, J.T. Russell &
(44) Sons, Inc., Albemarle, NC (highway heavy
utility construction)(retail store)
5
(1) The year first elected indicates the year in which each individual was
first elected a director of the Bank of Stanly or the Company, as
applicable, and does not reflect breaks in certain of the named
individuals' tenures as directors of the Bank of Stanly or the Company,
as applicable.
DIRECTOR COMPENSATION5
Director Compensation
For service during 1999,2000, each director will be paid a fee of $200 for
each Board of Directors meeting attended and $100 for attendance at each committee meeting.meeting
of a committee.
During 1994, the Company adopted a plan under which individual
directors may elect each year to defer receipt of all or a designated portion of
their fees for that year. Amounts so deferred earn interest at rates tied to
market indices selected quarterly by the plan administrators, and such amounts
become payable in the future (in a lump sum or annual installments) as specified
by the director at the time of his or her deferral election. During 1998,1999,
Directors Brooks, Jones, Link, Lowder, Mullis, Newport, Reaves and Russell
deferred compensation pursuant to such plan.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORSMeetings and Committees of the Board of Directors
The Board of Directors of the Company held eightfive regular meetings and
twofour special meetings during 1998.1999. Each current director attended 75% or more of
the aggregate number of meetings of the Board of Directors and of any committees
on which he or she served with the exception of DirectorDirectors David M. Jones and W.
Chester Lowder whose absences were due to prior business commitments.
The Company's Board of Directors has several standing committees,
including an Examining Committee, a PersonnelPersonnel/Stock Option Committee , a
Compensation Committee and a Nominating Committee.
The current members of the Examining Committee are Cynthia H. BeaneJohn P. Murray -
Chairman, Gail C. Burris, Joe S. Brooks, John P. MurrayGeorge T. Reaves and Kent E. Newport.
The Examining Committee reviews the annual audit reports of the Company's
independent auditors and the examination reports issued by bank regulatory
agencies, and oversees the work of the Company's internal auditor. The Examining
Committee met sixseven times during 1998.1999.
The current members of the PersonnelPersonnel/Stock Option Committee which
performs the functions of the Compensation Committee are B.A. Smith, Jr. -
Chairman, Joe S. Brooks, G. Chad Efird,Ronald T. Burleson, Kyle H. Josey, James F. Link, D.V.M., W. Chester
Lowder and Douglas V.
Waddell.A. James Russell. The PersonnelPersonnel/Stock Option Committee is authorized
to consider and make recommendations to the Board of Directors for action on
matters pertaining to the compensation of executive officers of the Company and
the Bank.its subsidiaries. The PersonnelPersonnel/Stock Option Committee met three timestwice during 1998.1999.
There is no current Nominating Committee. However, the Nominating
Committee met twice between January and April 1999. The Personnel Committee also
serves as the Personnel Committee.
The current members of the
Nominating Committee arewere John P. Murray - Chairman, James F. Link, D.V.M., W.
Chester Lowder, A. James Russell and B.A. Smith, Jr. The Nominating Committee
recommends candidates to the Company's Board of Directors for selection as
nominees for election as directors of the Company. The Nominating Committee met three times during 1998. In making its
recommendations, the Nominating Committee will consider candidates recommended
by shareholders. Recommendations of nominee candidates by shareholders for the
20002001 Annual Meeting should be
6
submitted in writing to the Chief Executive Officer of the Company by 6
September
30, 1999,2000, and should be accompanied by a statement of each candidate's
qualifications to serve as a director.
EXECUTIVE OFFICERSExecutive Officers
The following table contains information about the current executive
officers of the Company, the Bank of Stanly and its subsidiaries.subsidiary, The Strategic
Alliance Corporation.
EMPLOYED
NAME AND AGE CURRENT POSITIONS WITH COMPANY AND/OR SUBSIDIARIESBANK EMPLOYED SINCE
Ronald B. Davis President of the Company and President and Chief Executive 1997
(52) Officer of the Bank 1997
(51)of Stanly
Roger L. Dick President and Chief Executive Officer of the Company 1983
(47)
Susan B. Gibson Vice President of the Bank (human resources) 1996
(37)
Jacqueline S. Jernigan Executive Vice President of the Bank (retail banking) 1983
(44)
Dawn L. Melton Executive Vice President of the Company (technology) 1983
(38)
Tamara M. Singletary Executive Vice President of the Company (investor 1983
(39) relations)
Christy(48)
Christine D. Stoner President and Chief Executive Officer of The Strategic 1991
(34) Alliance Corporation Thomas H. Swaringen Executive Vice President of the Bank (credit 1990
(55) administration)
Barbara S. Williams Senior Vice President of the Company (finance) 1995
(55)
O. David Williams, Jr. Executive Vice President of the Bank (commercial banking) 1991
(40)(35)
EXECUTIVE COMPENSATIONExecutive Compensation
The following table reflectsshows for 1999, 1998 and 1997, the compensation
paid to or received or deferred by the Company's chief executive officer during 1998, 1997officers of the Company and 1996.
The table also includes the compensation paid to or received or deferred by the
Bank's chief executive officer for 1998its
direct and 1997.indirect subsidiaries. No other current executive officers of the Company or the Bank received
compensation for 1998the years indicated which exceeded $100,000.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------- -------------------------------------------------- --------------------------------
AWARDS PAYOUTS
------OTHER -------
OTHER ALL
ANNUAL RESTRICTED OTHER
COMPEN- RESTRICTED OPTIONS/STOCK LTIP COMPEN-
SALARY BONUS SATION STOCK SARSAWARDS OPTIONS PAYOUTS SATION
NAME AND PRINCIPAL POSITION YEAR ($)(1) ($) BONUS(2) ($)(3) AWARDS($) (#)(5) ($) ($)(4)
- --------------------------- ---- -------- ------- ------------- ------ ------ --- ------ POSITION ($)(2) ($)
- ---------- ------- --- ------
Roger L. Dick, Chief 1999 135,163 38,258 -0- -0- 54,100 -0- 4,863
Executive Officer of the 1998 125,500 26,275 -0- -0- 9,689 -0- 9,142
President and ChiefCompany 1997 118,000118,999 48,752 -0- -0- 19,378 -0- 9,500
Executive Officer of 1996 107,966 5,398 -0- -0- -0- -0- 6,802
the Company 116,0859,500
Ronald B. Davis, 1999 135,163 38,268 -0- -0- 72,000 -0- 3,010
President of the Company; 1998 125,500 20,775 -0- -0- 19,3769,688 -0- 2,988
President and Chief 1997 86,000 4,500 -0- -0- 45,59021,710 -0- -0-
Executive Officer of the
Bank of Stanly (6)
Christine D. Stoner, 1999 84,167 19,208 -0- -0- 69,400 -0- 2,584
President of The 1998 75,000 6,271 -0- -0- 3,500 -0- 4,522
Strategic Alliance 1997 66,667 6,333 -0- -0- -0- -0- 4,390
Corporation
7
(1) Includes amounts deferred at the officer'sofficers' election pursuant to the
Company's Section 401(k) savings plan.
(2) Includes all cash bonuses received for each year by the officers.year. At the end of each
year the Company's Board of Directors may approve the payment of annual
cash bonuses to individual officers based on the Company's results of
operations and their individual performance during the year. The
payment and amounts of any such bonuses are determined solely by the
Company's Board of Directors. In addition to discretionary cash
bonuses, the
7
Company maintained an incentive plan under which, at the end of each
calendar quarter, each of certain officers and employees could receive
a cash bonus (equal to 5.0% of their quarterly salary) if the Company's
financial performance for that quarter equaled or exceeded budgeted
amounts.
(3) In addition to compensation paid in cash, the Company's executive
officers receive certain personal benefits. However, the aggregate
value of non-cash benefits received by the executive officers during
each year did not exceed 10% of cash compensation paid to them.such
executive officer.
(4) Consists entirely of the Company's contributions on behalf of the
executive officers to the Company's Section 401(k) savings plan.
(5) The number of shares covered by options have been restatedincreased to reflect68,895 as a result
of a 3% stock dividend declared in December 1996, a 5% stock dividend
in 1997, and a 2-for-1 stock split in the form of1998, and a 100%3% stock dividend
declared in 1998.
(6) Mr. Davis was employed by the Company on April 14, 1997, and therefore
all amounts for 1997 included in the table for Mr. Davis reflect the
period from the date of employment through the end of 1997.
STOCK OPTIONSNovember 1999.
Stock Options
The following table contains information with regard to grants of stock
options during 19981999 to Roger L. Dick, President and Chief Executive Officer of the Company,
and Ronald B. Davis, President of the Company and Chief Executive Officer of the
Bank.Bank of
Stanly and Christine D. Stoner, President of The Strategic Alliance Corporation.
STOCK OPTION GRANTS IN 1998
INDIVIDUAL GRANTS
Number1999
Individual Grants
NUMBER OF
SECURITIES % OF OPTIONS
UNDERLYING GRANTED
OPTIONS TO EMPLOYEES IN EXERCISE OR BASE
NAME GRANTED (#)(1) FISCAL YEAR PRICE ($) PER SHARE EXPIRATION DATE
- ---- -------------- ----------- ------------------- ---------------
Roger L. Dick 54,100 17.31 $5.50 11/28/09
Ronald B. Davis 72,000 23.03 $5.50 11/28/09
Christine D. Stoner 69,400 22.20 $5.50 11/28/09
(1) One-fifth of Securities %the options vest and become exercisable in each of Options
Underlying Granted
Options to Employees Exercise or Base
Name Grantedthe
five years beginning November 28, 2000, assuming the officer remains
employed by the Company. If employment terminates before the end of the
vesting period the officer may exercise vested options for varying
periods after termination (depending on the manner of termination) in
Fiscal Year Price ($) Per Expiration
- ---- --------------
(#)(1) Share Date
------ ----- ----
Roger L. Dick 19,378 (2) 21.35% $5.625 (2) 4/20/08
Ronald B. Davis 19,376 (2) 21.35 $5.625 (2) 4/20/08
(1) Stock options were fully vested upon grant date and must be exercised
prior to April 20, 2008.
(2) The number of shares covered by options andaccordance with the exercise price are
restated to reflect a 2-for-1 stock split in the form of a 100% stock
dividend on August 4, 1998.plan.
8
The following table contains information with respect to stock options
exercised during 19981999 and held at December 31, 19981999 by Roger L. Dick, the
Company's President and Chief Executive Officer and Ronald B.
Davis President
and Chief Executive Officer of the Bank.
8
Christine D. Stoner.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS/SARS
OPTIONS/SARS AT FY-END AT FY-END
(#) ($)(1)
---------------------- -------------------------
SHARES
ACQUIRED ON VALUE
EXERCISE REALIZED
NAME (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ----------- --- ----------- ------------- ----------- -------------
Roger L. Dick 11,415 51,777 27,361 82,674 74,586 225,36931,780 87,083 58,617 28,384 179,192 86,770
Ronald B. Davis -0- -0- 37,612 13,677 32,988 24,74286,325 52,592 94,377 31,152
Christine D. Stoner -0- -0- 69,421 41,640 117,161 10,410
(1) Represents the aggregate fair market value at December 31, 19981999 (based
on an estimated market valuea trading price of $5.50$5.75 per share) of shares underlying unexercised
options held on that date, minus the aggregate exercise or purchase
price of those shares.
TRANSACTIONS WITH MANAGEMENTEmployee Stock Ownership Plan
On January 1, 1999, the Uwharrie Capital Corp. Stock Ownership Plan and
Trust (the "ESOP") became effective. Under the ESOP, all employees who have been
employed by the Company or any of its direct or indirect subsidiaries for one
year and attained the age of 18 are eligible to participate. Pursuant to the
ESOP, 224,726 shares were placed in trust with Roger L. Dick, Ronald B. Davis,
Christine D. Stoner, Lorelei V. Misenheimer, Jacqueline S. Jernigan and Barbara
S. Williams as trustees. In 1999, ____ shares were allocated to employees under
the ESOP.
Transactions with Management
The Bank of Stanly has had, and expects to have in the future, banking
transactions in the ordinary course of business with certain of the Company's
and the Bank's directors
and executive officers and their associates.associates of the Company and its direct and
indirect subsidiaries. All loans included in such transactions were made on
substantially the same terms, including interest rates, repayment terms and
collateral, as those prevailing at the time for comparable transactions with
other persons, and do not involve more than the normal risk of collectibility or
present other unfavorable features.
9
PROPOSAL 2: INCREASE IN NUMBERAMENDMENT OF AUTHORIZED SHARESTHE ARTICLES OF COMMONINCORPORATION
TO AUTHORIZE THE ISSUANCE OF PREFERRED STOCK
The Proposed Amendment
The Board of Directors of the Company voted to recommend tohas unanimously approved and recommends that the shareholders
anapprove Proposal 2 which provides for the amendment toof Article II of the
Company's CharterArticles of Incorporation to
increase by
14,000,0009
provide for the numberauthorization of authorized10,000,000 shares of preferred stock. See
Exhibit A for the Company's capital stock (the
"Amendment").complete text of proposed Article II.
Reasons for Proposal 2
The Company presently has 6,000,000 shares authorized classified
as Common Stock. AsArticles of Incorporation currently do not authorize the Record Date, there were ________issuance
of any preferred stock. Article II currently provides only for the authorization
of 20,000,000 shares of Common
Stockcommon stock at a par value of $1.25 per share. Proposal
2 would authorize 10,000,000 preferred shares that could be issued and outstanding. If the Amendment is approved by the shareholders,
all additional shares authorized by the Amendment would be classified as Common
Stock. The relative rights and limitations of the Common Stock would remain
unchanged under the Amendment. Holders of Common Stock do not have any
preemptive rights.
The Amendment has been recommended by the Board
of Directors from time to assure
that an adequate supplytime in amounts, and at par values, and with annual
dividend rates as may be determined by the Board of authorized, unissuedDirectors. Such preferred
shares is available for future
acquisitionscould be divided into two or more series by the Board and general corporate needs,shall have such
voting rights, preferences, limitations and relative rights as futurethe Board may
determine. The ability to issue preferred stock dividends, stock
splits, or issuance under stock-based benefit plans. There are currentlyallows the Company additional
financial flexibility in its capital structure. While the Company has no current
plans or arrangements relating to the issuance of any of the additionalissue shares of the Common Stock to be authorized. If the Amendment is approved bypreferred stock, should the shareholders approve
Proposal 2, the Board of Directors would be free to structure one or more series
of preferred stock and sell such shares either in a public or private offering
to potential investors. Additionally, since Proposal 2 would be available for issuance without further action
byallow the shareholders, unless required byBoard to
design a series of preferred stock with characteristics unfavorable to a
potential acquiror and issue such shares to a "friendly party," the Company's Charter or bylaws or by
applicable law.
The issuance of additional shares of Common Stock may, among other
things, have a dilutive effect on earnings per share and on the equity and
voting power of existing holders of Common Stock. The issuance of additional
shares of Common Stock by the Company also may potentially have an anti-takeover
effect by making it more difficult to obtain shareholder approval of various
actions, such as a merger or removal of management.
The text of Article II of the Charter, as proposed to be amended, is as
follows:
"The Corporation shall have authority to
issue a totalpreferred stock is thought to be an "anti-takeover" device.
Notwithstanding its potential "anti-takeover" effect, the Board of 20,000,000Directors
believes that it is in the Company's best interest to have the ability to issue
preferred shares of
capital stock which shall consist of Common Stock, $1.25 par value per share,
all of one class."from time to time as may be needed in the Company's and
shareholders' best interest.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" PROPOSAL 2
AMENDING THE ARTICLES OF INCORPORATION TO AMENDAUTHORIZE THE CHARTERISSUANCE OF THE COMPANYUP TO INCREASE THE AUTHORIZED NUMBER OF SHARES
PROPOSAL 3: AMENDMENT OF EMPLOYEE STOCK OPTION PLAN
The 1996 Employee Stock Option Plan (the "Plan") was adopted by the
Company on February 20, 1996 and was approved by the shareholders at the annual
meeting held April 23, 1996. The general purpose of the Plan is to advance the
interests of the Company, or any company which is a subsidiary of the Company,
and its shareholders by providing key employees with a sense of proprietorship
and personal involvement in the development and financial success of the Company
10
and to encourage such employees to remain with and to devote their best efforts
to the Company. The Plan authorized the sale of an aggregate of 212,400 shares
of the Company's common stock, $1.25 par value per share ("Common Stock") upon
the exercise of options ("Options"). The number of shares authorized has been
increased from time to time as a result of stock dividends declared and paid by
the Company since the approval of the Plan. All of the Options authorized under
the Plan have been granted to key officers and employees of the Company. The
Plan shall remain in effect until the year 2006.
The Board of Directors has recognized the importance of the Plan in
fostering the purposes set forth in the Plan. Growth in the Company's personnel
as a result of the growth in assets of the Company has resulted in a need to
authorize additional Options pursuant to the provisions of the Plan. In January
1999, the Board of Directors authorized, subject to shareholder approval, the
issuance of an additional 600,000 Options pursuant to the provisions of the
Plan.
The Plan is administered by a committee of the Company's Board of
Directors who are not employees of the Company and who otherwise qualify as
"disinterested administrators" as defined in Rule 16(b)-3(c)(2)(i) under the
Securities Exchange Act of 1934. To be eligible to receive an Option under the
Plan, a person must be a full-time employee of the Company or any subsidiary of
the Company. The Committee has the discretion to cause any Option granted
pursuant to the Plan to be granted with the intent that it qualify for treatment
as an "incentive stock option" as defined in Section 422 of the Internal Revenue
Code, or with the intent that it be treated as a "nonqualified stock option".
Each Option is evidenced by a written agreement between the Company and the
Optionee. At the time of the grant, the Committee sets the Option price
applicable to the Option. That price must not be less than 100% of the fair
market value of the common stock of the Company on the date of grant.
The term of each Option shall be set by the Committee at the time the
Option is granted and except under particular circumstances shall not be more
than 10 years following date of grant of the Option. Under the Plan, the
Committee may require that an Option not be exercised until the Optionee has
completed a period of continuous, full time service in the employment of the
Company or a subsidiary following the date of grant as specified in each
Agreement with each Optionee. All options must be exercised for a whole number
of shares and may be paid for in cash or in other shares of the Common Stock of
the Company. Options are terminated if the Optionee's employment with the
Company is terminated for "cause" or the employee voluntarily terminates
employment (other than by reason of disability or retirement). In the case of an
Optionee whose employment with the Company is terminated for reasons other than
for "cause", any unexercised Option held by the Optionee may be exercised at any
time during a period of 90 days following the date of such termination (but not
later than the end of the Option term).
The Plan may be amended by the Board of Directors, upon recommendation
of the Committee, however no such amendment may be effected that increases the
aggregate number of shares of common stock which may be issued upon the exercise
of Options unless approved by the shareholders. Accordingly, in January 1999 the
Board of Directors adopted an amendment to the Plan, upon recommendation of the
Committee, to add an additional 600,000 shares of Common
11
Stock to be issued upon the exercise of Options under the Plan and proposes such
amendment to the shareholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR"_____
PREFERRED SHARES.
PROPOSAL 3 TO
AMEND THE EMPLOYEE STOCK OPTION PLAN
PROPOSAL 4: RATIFICATION OF APPOINTMENT OF ACCOUNTANTS
The Board of Directors has appointed the firm of Dixon Odom PLLC,
Certified Public Accountants, as the Company's independent accountants for 1999,2000,
and a proposal to ratify that appointment will be submitted for shareholder
approval at the Annual Meeting.
A representative of Dixon Odom PLLC is expected to be present at the
Annual Meeting and available to respond to appropriate questions, and will have
the opportunity to make a statement if he desires to do so.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" RATIFICATION OF
THE APPOINTMENT OF DIXON ODOM PLLC AS THE COMPANY'S INDEPENDENT ACCOUNTANTS FOR
19992000.
10
OTHER MATTERS
The Board of Directors knows of no other business that will be brought
before the Annual Meeting. Should other matters properly be presented for action
at the Annual Meeting, the Proxies, or their substitutes, will be authorized to
vote shares represented by appointments of proxy according to their best
judgment.
PROPOSALS OF SHAREHOLDERS
Any proposal of a shareholder which is intended to be presented at the
Company's 2000 Annual Meeting must be received in writing by the Company at its main office
in Albemarle, North Carolina, no later than November 15, 1999,September 30, 2000, to be considered
timely received for inclusion in the proxy statement and appointment of proxy to
be distributed in connection with that meeting. Any otherIf a proposal intendedfor the 2001
Annual Meeting is not expected to be presented atincluded in the Company's 2000 Annual
Meetingproxy statement for that
meeting, the proposal must be received by the Company atby February 15, 2001 for
it to be timely received for consideration. The Company will use its
main office in Albemarle, North
Carolina, no later than February 21, 2000.
Nominationsdiscretionary authority for directors must be submitted in writing to the Chief
Executive Officer of the Company for consideration by the Nominating Committee
by September 30, 1999.
12
any proposals received thereafter.
ADDITIONAL INFORMATION
A COPY OF THE COMPANY'S 19981999 ANNUAL REPORT ON FORM 10-KSB WILL BE
PROVIDED WITHOUT CHARGE TO ANY SHAREHOLDER ENTITLED TO VOTE AT THE ANNUAL
MEETING UPON THAT SHAREHOLDER'S WRITTEN REQUEST. REQUESTS FOR COPIES SHOULD BE
DIRECTED TO TAMARA M. SINGLETARY, SECRETARY, UWHARRIE CAPITAL CORP, 134167 NORTH
FIRSTSECOND STREET, ALBEMARLE, NORTH CAROLINA 28001.
1311
***********************************APPENDIX*************************************EXHIBIT A
Article II of the Articles of Incorporation of Uwharrie Capital Corp
shall be amended, subject to shareholder approval of Proposal 2, to read in its
entirety as follows:
The Corporation shall have the authority to issue a total of 30,000,000
shares of capital stock divided into 20,000,000 shares of common stock, all of
one class, with each share having a par value of $1.25 and 10,000,000 shares of
preferred stock. The shares of preferred stock may be divided into two or more
series by the Board of Directors with each series having such relative rights,
privileges, preferences and limitations as the Board of Directors of the
Corporation may and hereby is authorized to determine.
12
PRELIMINARY PROXY
UWHARRIE CAPITAL CORP
134167 NORTH FIRSTSECOND STREET
ALBEMARLE, NORTH CAROLINA 28001
APPOINTMENT OF PROXY
SOLICITED BY BOARD OF DIRECTORS
The undersigned hereby appoints Roger L. Dick, Dawn L. MeltonRonald B. Davis and
Tamara
M. SingletaryChris A. Whitfield (the "Proxies"), or any of them, as attorneys and proxies,
with power of substitution, to vote all outstanding shares of the common stock
of Uwharrie Capital Corp (the "Company") held of record by the undersigned on
March 17, 1999,15, 2000, at the Annual Meeting of Shareholders of the Company to be held
at the Stanly County Agri-Civic Center at 26032 Newt Road, Albemarle, North
Carolina, at 4:00 p.m. on April 27, 1999,May 2, 2000, and at any adjournments thereof:
1. ELECTION OF DIRECTORS: Proposal to elect six directors of the Company for
three year terms or until their successors are duly elected and qualified.
[ ]_____ FOR ALL NOMINEES LISTED BELOW [ ]_____ WITHHOLD AUTHORITY
(EXCEPT AS INDICATED OTHERWISE TO VOTE FOR ALL NOMINEES
BELOW) LISTED BELOW
NOMINEES:
Cynthia H. Beane [ ] FOR ALL EXCEPT
Kyle H. Josey
Joyce H. Little
W. Chester Lowder
B.A. Smith, Jr.
Douglas V. Waddell
INSTRUCTION:Joe S. Brooks
Ronald T. Burleson
James F. Link, D.V.M.
Kent E. Newport
George T. Reaves
A. James Russell
(INSTRUCTION: To withhold authority to vote for any individual
nominee(s), mark "FOR ALL EXCEPT" andone or more nominees,
write the name(s)that nominee's name on the line below.
- --------------------------------------------------------------------------------provided.)
2. AMENDMENT OF ARTICLE II OF THE ARTICLES OF INCORPORATION TO INCREASE NUMBER OF AUTHORIZED
SHARES OF THE COMPANY TO 20,000,000 SHARES.
[ ]INCORPORATION: Proposal to amend
Article II of the Articles of Incorporation to authorize preferred stock.
_____ FOR [ ] AGAINST [ ]_____ AGAISNT _____ ABSTAIN
3. AMENDMENT OF EMPLOYEE STOCK OPTION PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS: Proposal to
ratify the appointment of Dixon Odom PLLC as the Company's independent
accountants for 1999.
[ ]2000.
_____ FOR [ ] AGAINST [ ]_____ AGAISNT _____ ABSTAIN
5.4. OTHER BUSINESS: The Proxies are authorized to vote the shares represented
by this Appointment of Proxy according to their best judgment on such other
matters as may be presented for action at the Annual Meeting.
THE SHARES REPRESENTED BY THIS APPOINTMENT OF PROXY WILL BE VOTED BY
THE PROXIES IN ACCORDANCE WITH THE SPECIFIC INSTRUCTIONS ABOVE. IN THE ABSENCE
OF INSTRUCTIONS, THE PROXIES WILL VOTE SUCH SHARES "FOR" THE ELECTION OF EACH OF
THE NOMINEES LISTED IN PROPOSAL 1 ABOVE AND "FOR" PROPOSALS 2 3 AND 43 ABOVE. IF,
AT OR BEFORE THE TIME OF THE MEETING, ANY OF THE NOMINEES LISTED IN PROPOSAL 1
FOR ANY REASON HAVE BECOME UNAVAILABLE FOR ELECTION OR UNABLE TO SERVE AS
DIRECTORS, THE PROXIES HAVE THE DISCRETION TO VOTE FOR A SUBSTITUTE NOMINEE OR
NOMINEES. THIS APPOINTMENT OF PROXY MAY BE REVOKED AT ANY TIME BEFORE IT IS
EXERCISED BY FILING WITH THE SECRETARY OF THE COMPANY AN INSTRUMENT REVOKING IT
OR A DULY EXECUTED APPOINTMENT OF PROXY BEARING A LATER DATE, OR BY ATTENDING
THE ANNUAL MEETING AND REQUESTING THE RIGHT TO VOTE IN PERSON.
Date: , 1999
--------------------------
(Date)2000
----------------------------
(SEAL)
-------------------------------------------------------------
(Signature)
(SEAL)
-------------------------------------------------------------
(Signature, if shares held jointly)
INSTRUCTION: PLEASE SIGN ABOVE
EXACTLY AS YOUR NAME APPEARS ON THIS
APPOINTMENT OF PROXY. JOINT OWNERS
OF SHARES SHOULD BOTH SIGN.
FIDUCIARIES OR OTHER PERSONS SIGNING
IN A REPRESENTATIVE CAPACITY SHOULD
INDICATE THE CAPACITY IN WHICH THEY
ARE SIGNING.
PLEASE MARK, SIGN, DATE AND PROMPTLY RETURN THIS
PROXY CARD IN THE ENCLOSED ENVELOPE
2