SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-
12
CARDINAL BANKSHARES CORPORATION
(Name of Registrant as Specified In Its Charter)
N.A.
(Name of Person(s) Filing Proxy Statement
if other than the 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.
Not Applicable.
[ ] 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.
Not Applicable.
March 27, 1998
Dear Stockholder:
You are cordially invited to attend the annual meeting of
stockholders of Cardinal Bankshares Corporation. The meeting
will begin at 2:00 p.m. on Wednesday, April 22, 1998, at The Bank
of Floyd Community Room, Floyd, Virginia.
Please sign and date the enclosed proxy and mail it in the
envelope provided at your earliest convenience.
You are also invited to remain after the meeting for light
refreshments and visiting. If you plan to attend, please include
the enclosed card with your proxy.
Very truly yours,
Leon Moore
President
CARDINAL BANKSHARES CORPORATION
101 Jacksonville Circle
P.O. Box 215
Floyd, Virginia 24091
PROXY SOLICITED BY BOARD OF DIRECTORS
The undersigned hereby appoints William R. Rakes, C.W.
Harman, and Ronald Leon Moore or any one or more of them, as
proxies, with full power of substitution, to vote all common
stock of the undersigned at the Annual Meeting of Stockholders of
the Corporation, to be held on April 22, 1998, at 2:00 p.m., and
at any adjournment thereof, as follows:
(1) To vote FOR election to the Board of Directors of all
nominees listed below as a group, unless you insert the word
"NO" at the end of this sentence. If you insert the word
"NO", you will withhold such authority and cause your shares
not to be voted in favor of anyone in the group.
_________________.
YOU MAY WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE BY
LINING THROUGH OR OTHERWISE STRIKING OUT HIS NAME BELOW. Your
proxy will then be voted for all nominees not so marked.
Nominees for Directors to serve until the 1999 Annual Meeting of
Stockholders and until their successors are elected and have
qualified, (or if sooner, until their retirement dates under the
director retirement policy adopted by the Board of Directors)
are:
K. Venson Bolt Kevin D. Mitchell
J.H. Conduff Ronald Leon Moore
W.R. Gardner, Jr. Dorsey H. Thompson
C.W. Harman
(2) To vote for appointment of Larrowe, Cardwell & Company,
L.C., as independent auditor of the Corporation for the year
1998, unless one of the following two alternatives is
chosen: AGAINST ( ); ABSTAIN ( ).
(3) To vote upon such other business as may be properly brought
before the meeting.
THE STOCK REPRESENTED BY THIS PROXY WILL BE VOTED AS SPECIFIED.
IF AUTHORITY IS NOT WITHHELD, OR IF NO CHOICE IS SPECIFIED, THE
STOCK REPRESENTED BY THIS PROXY WILL BE VOTED FOR ALL NOMINEES
NAMED ABOVE TO BE ELECTED TO THE BOARD OF DIRECTORS AND FOR
APPOINTMENT OF LARROWE, CARDWELL & COMPANY, L.C. AS INDEPENDENT
AUDITOR FOR THE CORPORATION FOR 1998.
Please sign your name(s) exactly as shown imprinted hereon. If
acting as executor or trustee or otherwise in a fiduciary
capacity, please sign as such fiduciary.
_____________________________________
Signature of Stockholder
_____________________________________
Signature of Stockholder
Date:________________________________
CARDINAL BANKSHARES CORPORATION
101 Jacksonville Circle
P.O. Box 215
Floyd, Virginia 24091
NOTICE OF 1998 ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Cardinal Bankshares Corporation:
NOTICE is hereby given that the 1998 Annual Meeting of
Stockholders of Cardinal Bankshares Corporation will be held at
The Bank of Floyd Community Room, Floyd, Virginia, on April 22,
1998, at 2:00 p.m. for the following purposes:
(1) Electing Directors for the ensuing year.
(2) Approving appointment of the Corporation's
independent auditor for the year 1998.
(3) Transacting such other business as may properly
come before the meeting, or any adjournments thereof.
Only stockholders of record at the close of business on
March 23, 1998, are entitled to notice of and to vote at such
meeting, or any adjournments thereof.
Your attention is directed to the Proxy Statement
accompanying this notice for a more complete statement regarding
matters proposed to be acted upon at the meeting.
To ensure that your shares are represented at the meeting,
please fill in, date, sign, and mail promptly the enclosed proxy,
for which a return envelope is provided. Your proxy is revocable
at any time prior to its exercise.
By Order of the Board of Directors
March 27, 1998
CARDINAL BANKSHARES CORPORATION
101 Jacksonville Circle
P.O. Box 215
Floyd, Virginia 24091
PROXY STATEMENT
FOR 1998 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD
APRIL 22, 1998
The Board of Directors of Cardinal Bankshares Corporation
(the Corporation") solicits the enclosed proxy to be used at the
1998 Annual Meeting of Stockholders to be held at The Bank of
Floyd Community Room, 101 Jacksonville Circle, Floyd, Virginia,
on Wednesday, April 22, 1998, at 2:00 p.m., and at any
adjournment thereof.
The cost of solicitation of proxies will be borne by the
Corporation. Solicitations will be made only by mail, except
that, if necessary, officers and regular employees of the
Corporation and The Bank of Floyd may make solicitations of
proxies by telegram, telephone or personal calls. Brokerage
houses and other nominees may request that copies of the proxy
soliciting material be furnished to them for mailing to the
beneficial owners of the stock held of record by such brokerage
houses and nominees. The Corporation may reimburse them for
their reasonable expenses in this connection.
All properly executed proxies delivered pursuant to this
solicitation will be voted at the meeting in accordance with the
instructions therein contained, if any. Any person signing and
mailing the enclosed proxy may, nevertheless, revoke the proxy at
any time prior to the actual voting thereof. Directors are
elected by a plurality of votes properly cast, assuming a quorum
is present. All matters coming before the meeting will be
approved if the votes favoring such matter exceed those opposing
it. Abstentions and broker non-votes will have no direct effect
on the election of directors or any other matter which may be
considered.
An Annual Report to Stockholders, including the
Corporation's financial statements for the year ended December
31, 1997, accompanies this proxy statement. This proxy statement
and the accompanying proxy are first being sent or delivered to
stockholders of the Corporation on or about March 27, 1998.
As of March 23, 1998, the Corporation had 511,911
outstanding shares of its common stock, each of which is entitled
to one vote at the Annual Meeting. Only stockholders of record
at the close of business on March 23, 1998, will be entitled to
vote at the meeting, or any adjournment thereof.
ITEM 1: ELECTION OF DIRECTORS
At the meeting, seven Directors will be elected, to serve
until the 1999 Annual Meeting of Stockholders, or if sooner,
until their retirement dates under the director retirement policy
adopted by the Board of Directors.
In the event that any nominee becomes unavailable for
election, any proxy voted in his favor will be voted for a
substitute nominee. However, the Board of Directors does not
anticipate that any nominee will be unavailable for election, and
all have consented to be named and to serve if elected. Each
nominee hereinafter named has been recommended for election by
the Board of Directors.
INFORMATION CONCERNING NOMINEES
<TABLE>
<CAPTION>
Principal Occupation
and Principal
Director Business Conducted
Name Age Since Past Five Years
</CAPTION>
<S> <C> <C> <C>
K. Venson Bolt 72 3/12/96 Vice Chairman, The
Bank of Floyd;
Farmer
J.H. Conduff 77 3/12/96 Chairman of the
Corporation and The
Bank of Floyd;
Dentist
W.R. Gardner, Jr. 55 3/12/96 Director of Pupil
Personnel, Floyd
County Public
Schools
C.W. Harman 74 3/12/96 Retired Farmer and
Merchant
Kevin D. Mitchell 59 3/12/96 Dairy Farmer
Ronald Leon Moore 56 3/12/96 President and Chief
Executive Officer of
the Corporation and
The Bank of Floyd
Dorsey H. Thompson 68 3/12/96 Farmer
</TABLE>
EXECUTIVE COMPENSATION
The following table sets forth the compensation of the
Corporation's Chief Executive Officer for the fiscal year ended
December 31, 1997, 1996 and 1995. No other officer received in
excess of $100,000 for the current year.
Summary Compensation Table
<TABLE>
<CAPTION>
Name and Capacity All Other
in Which Served Year Salary Compensation<F1>
</CAPTION>
<S> <C> <C> <C>
Ronald Leon Moore, 1997 $103,500.00 --
President and Chief 1996 $ 97,700.00 $ 2,940.00
Executive Officer 1995 $ 94,600.00 $ 2,940.00
<FN>
_____________________
<F1> Employer contribution to the Corporation's pension plan for
the years indicated.
</FN>
</TABLE>
DIRECTORS MEETINGS, COMMITTEES AND FEES
Directors of the Corporation currently receive a fee of $200
for each board meeting attended and $60 for each committee
meeting attended. The Board of Directors held seven meetings
during the last fiscal year. All incumbent directors attended at
least 75 percent of the aggregate number of meetings held by the
Board and meetings of committees on which they served.
The Board of Directors has appointed an Audit Committee
consisting of the following nonemployee directors: K. Venson
Bolt, W.R. Gardner, Jr., Kevin D. Mitchell and Dorsey H.
Thompson. The Audit Committee, which met seven times during
1997, reviews the financial records and reports of the Bank and
each of its affiliates.
The Board of Directors has appointed a Nominating Committee,
consisting of Kevin D. Mitchell, K. Venson Bolt and W.R. Gardner,
Jr., to consider nominees to stand for election to the Board of
Directors. This committee met one time during 1997. The
Nominating Committee has no formal procedure for considering
nominees proposed by the shareholders. The Board of Directors
has not created a Compensation Committee.
OWNERSHIP OF COMMON STOCK
The following stockholder beneficially owns in excess of
five percent of the outstanding common stock of the Corporation.
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent of Class
Beneficial Owner Beneficial Ownership
</CAPTION>
<S> <C> <C>
Joseph H. Conduff 51,137<F1> 9.9
P.O. Box 113
Floyd, VA 24091
<FN>
_________________
<F1> Includes 5,280 shares owned by his wife.
</FN>
</TABLE>
The following table sets forth the beneficial ownership of the
Common Stock of the Corporation as of March 23, 1998, by each
director (including the Chief Executive Officer) and nominee and
all directors and executive officers as a group.
<TABLE>
<CAPTION>
Name of Beneficial Amount and Nature of Percent of Class
Owner Beneficial Ownership<F1>
</CAPTION>
<S> <C> <C>
K. Venson Bolt 2,956 <F3> <F2>
J.H. Conduff 51,137 <F4> 9.99
W.R. Gardner, Jr. 440 <F2>
C.W. Harman 2,034 <F5> <F2>
Kevin D. Mitchell 5,350 <F6> 1.04
Ronald Leon Moore 2,055 <F7> <F2>
Dorsey H. Thompson 2,909 <F8> <F2>
All directors and 66,881 13.06
Executive officers as
a group (7 persons)
<FN>
___________________________________
<F1> Includes shares which may be deemed beneficially owned by
virtue of family relationships, joint ownership, voting
power or investment power.
<F2> Less than 1 percent.
<F3> Includes 176 shares owned with his wife.
<F4> Includes 5,280 shares owned by his wife.
<F5> Includes 1,586 shares owned with his wife.
<F6> Includes 220 shares owned by his wife, 246 shares owned with
his wife, and 220 shares owned for his son.
<F7> Includes 1,100 shares owned by his wife, and 388 shares
owned with his wife.
<F8> Includes 946 shares owned with his wife.
</FN>
</TABLE>
Section 16(a) Beneficial Ownership Reporting Compliance
Based on a review of the forms submitted to the Corporation
during or with respect to its fiscal year ended December 31,
1997, no person required to file reports pursuant to Section 16
of the Securities Exchange Act of 1934 failed to file any such
report on a timely basis during that year.
CERTAIN TRANSACTIONS
Some of the directors and officers of the Corporation and
their families are at present, as in the past, customers of the
Corporation, and have had and expect to have transactions with
the Corporation in the ordinary course of business. In addition,
some of the directors and officers of the Corporation are at
present, as in the past, also directors and officers of
corporations which are customers of the Corporation and which
have had an expect to have transactions with the Corporation in
the ordinary course of business. Such transactions were made in
the ordinary course of business on substantially the same terms,
including interest rates and collateral, as those prevailing at
the time for comparable transactions with other persons, and did
not involve more than normal risk of collectibility or present
other unfavorable features.
ITEM 2: APPOINTMENT OF INDEPENDENT AUDITOR
Larrowe, Cardwell & Company, L.C. is being recommended to
the stockholders of the Corporation for appointment as
independent auditor for the year ending December 31, 1998.
Representatives of this firm are expected to attend the meeting
and have the opportunity to make a statement and respond to
appropriate questions from stockholders.
STOCKHOLDER PROPOSALS FOR 1999
If any eligible stockholder intends to present a proposal at
the 1999 Annual Meeting of Stockholders, such proposal must be
received by the Corporation at its principal executive office,
101 Jacksonville Circle, P.O. Box 215, Floyd, Virginia, on or
before December 1, 1998. Otherwise, such proposal will not be
considered for inclusion in the Corporation's proxy statement for
such meeting.
MISCELLANEOUS
All properly executed proxies received by the Corporation
will be voted at the meeting in accordance with the instructions
contained therein.
The Board of Directors knows of no matter not identified
herein which may properly come before the meeting for action.
However, if any other matter does properly come before the
meeting, the person or persons named in the proxy form enclosed
will vote in accordance with their judgment upon such matter.
You are urged to execute and return promptly the enclosed
form of proxy.
