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 Section 240.14a-11(c) or Section 240.14a-12
CT Communications, Inc.
(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:
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CT Communications, Inc.
68 Cabarrus Avenue East
Post Office Box 227
Concord, NC 28026-0227
CTC December 11, 1998
- ---
CT Communications TO THE SHAREHOLDERS:
You are cordially invited to attend a special meeting of the
shareholders (the "Special Meeting") of CT Communications,
Inc. (the "Company") to be held at the Company's Customer
Care Center, 2000 Progress Place, Northeast, in Concord,
North Carolina, on Thursday, January 28, 1999 at 9:00 a.m.,
local time.
At the Special Meeting, you will be asked to consider and
vote on a proposal to amend the Company's Articles of
Incorporation to (i) provide for one class of Common Stock,
consisting of 100,000,000 authorized shares, and (b)
reclassify, change and convert each issued and outstanding
share of Voting Common Stock into 4.4 shares of Common Stock
and each issued and outstanding share of Class B Nonvoting
Common Stock into 4.0 shares of Common Stock (the
"Recapitalization Amendment"). Cash will be paid in lieu of
issuing any fractional shares.
Enclosed are the (i) Notice of Special Meeting, (ii) Proxy
Statement, (iii) proxy card for the Special Meeting, and (iv)
pre-addressed return envelope for the proxy card. The Proxy
Statement describes in more detail the Recapitalization
Amendment. Please read these materials carefully and consider
thoughtfully the information set forth in them.
The Board of Directors of the Company has unanimously
approved the Recapitalization Amendment and believes that it
is fair to, and in the best interest of, the Company and its
shareholders. ACCORDINGLY, THE BOARD OF DIRECTORS RECOMMENDS
THAT YOU VOTE FOR ADOPTION AND APPROVAL OF THE
RECAPITALIZATION AMENDMENT AT THE SPECIAL MEETING.
Approval of the Recapitalization Amendment will require the
affirmative vote of the holders of a majority of the
outstanding shares of Voting Common Stock, voting as a single
class, and the outstanding shares of Class B Nonvoting Common
Stock, voting as a single class. Whether or not you plan to
attend the Special Meeting, you are urged to complete, sign,
date and return promptly the enclosed proxy card. If you
attend the Special Meeting, you may vote in person even if
you previously returned your proxy card.
We look forward to seeing you at the Special Meeting.
Sincerely yours,
/s/ Michael R. Coltrane
-----------------------------------
MICHAEL R. COLTRANE
PRESIDENT AND CHIEF EXECUTIVE OFFICER
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CT COMMUNICATIONS, INC.
68 Cabarrus Avenue, East
Concord, North Carolina 28025
----------------------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY 28, 1999
----------------------------------------
TO THE SHAREHOLDERS:
A Special Meeting of Shareholders of CT Communications, Inc. (the
"Company") will be held at the Company's Customer Care Center, 2000 Progress
Place, Northeast, in Concord, North Carolina, on Thursday, January 28, 1999, at
9:00 a.m., local time, for the following purposes:
(1) To consider and act upon a proposal to amend the Company's Articles of
Incorporation to (a) provide for one class of Common Stock, consisting of
100,000,000 authorized shares, and (b) reclassify, change and convert each
issued and outstanding share of Voting Common Stock into 4.4 shares of
Common Stock and each issued and outstanding share of Class B Nonvoting
Common Stock into 4.0 shares of Common Stock (the "Recapitalization"); and
(2) To transact such other business as may properly come before the Special
Meeting or any adjournment or adjournments thereof.
The Voting Common Stock and Class B Nonvoting Common Stock are the only
classes of capital stock to be reclassified in the Recapitalization. Therefore,
the holders of the Voting Common Stock and the Class B Nonvoting Common Stock
are the persons entitled to vote at the Special Meeting. December 1, 1998 has
been fixed as the record date for determining the shareholders entitled to
notice of and to vote at the Special Meeting, and at any adjournment or
adjournments thereof.
You are cordially invited to attend the Special Meeting. WHETHER OR NOT
YOU PLAN TO ATTEND, PLEASE SIGN, DATE AND RETURN THE ACCOMPANYING PROXY
PROMPTLY, SO THAT YOUR SHARES MAY BE REPRESENTED AND VOTED AT THE SPECIAL
MEETING. A return envelope is enclosed for your convenience.
By order of the Board of Directors,
/s/ Barry R. Rubens
-----------------------------------
BARRY R. RUBENS
SECRETARY
December 11, 1998
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CT COMMUNICATIONS, INC.
68 Cabarrus Avenue, East
Concord, North Carolina 28025
---------------
PROXY STATEMENT
---------------
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON JANUARY 28, 1999
This Proxy Statement is first being mailed to the shareholders of CT
Communications, Inc. (the "Company") on or about December 11, 1998 in
connection with the Special Meeting of Shareholders to be held on Thursday,
January 28, 1999, at 9:00 a.m., local time, at the Company's Customer Care
Center, 2000 Progress Place, Northeast, in Concord, North Carolina (the
"Special Meeting"), and at any adjournment or adjournments thereof. The purpose
of the Special Meeting is to take action upon a proposed amendment to the
Company's Articles of Incorporation (the "Recapitalization Amendment"), which
would (i) provide for one class of Common Stock, consisting of 100,000,000
authorized shares, and (ii) reclassify the Company's Voting Common Stock (the
"Voting Common Stock") and Class B Nonvoting Common Stock (the "Class B
Nonvoting Common Stock" and, together with the Voting Common Stock, the
"Converted Securities") into a single class of common stock (the "Common
Stock").
Pursuant to the Recapitalization Amendment, each outstanding share of the
Voting Common Stock would be reclassified, changed and converted into 4.4
shares of Common Stock (the "Voting Common Stock Conversion Ratio"), with cash
to be paid in lieu of issuing any fractional shares, and each outstanding share
of the Company's Class B Nonvoting Common Stock would be reclassified, changed
and converted into 4.0 shares of Common Stock (the "Class B Nonvoting Common
Stock Conversion Ratio" and, together with the Voting Common Stock Conversion
Ratio, the "Conversion Ratios"). In addition, all outstanding options to
purchase shares of Voting Common Stock and Class B Nonvoting Common Stock would
be converted automatically into options to purchase shares of Common Stock in
an amount and at an exercise price appropriately adjusted to reflect the
respective Conversion Ratios. The foregoing actions are referred to in this
Proxy Statement as the "Recapitalization."
This Proxy Statement is being sent to the holders of the Voting Common
Stock and the holders of Class B Nonvoting Common Stock. Approval of the
Recapitalization Amendment will require the affirmative vote of holders of a
majority of the shares of each such class outstanding and entitled to vote at
the Special Meeting, each voting separately as a class. The Company's 4 1/2%
Preferred Stock and 5% Preferred Stock will remain outstanding and will not be
affected by the Recapitalization Amendment. Accordingly, the holders thereof
are not entitled to notice of the Special Meeting or to vote with respect to
the approval of the Recapitalization Amendment. Therefore, this Proxy Statement
and the form of proxy to be used at the Special Meeting, which is being
solicited by the Board of Directors of the Company, is being sent only to the
holders of the Converted Securities.
BECAUSE APPROVAL OF THE PROPOSED RECAPITALIZATION AMENDMENT REQUIRES THE
AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE SHARES OF EACH CLASS OF
THE CONVERTED SECURITIES OUTSTANDING AND ENTITLED TO VOTE AT THE SPECIAL
MEETING, EACH VOTING SEPARATELY AS A CLASS, ABSTENTIONS FROM VOTING, AS WELL AS
BROKER NON-VOTES, WILL HAVE THE SAME EFFECT AS A NEGATIVE VOTE. ACCORDINGLY,
THE BOARD OF DIRECTORS URGES THE HOLDERS OF THE CONVERTED SECURITIES TO
COMPLETE, DATE AND SIGN THE ACCOMPANYING PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED, POSTAGE-PAID ENVELOPE.
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THE SPECIAL MEETING OF SHAREHOLDERS
The Special Meeting will be held on Thursday, January 28, 1999 at 9:00
a.m., local time, at the Company's Customer Care Center, 2000 Progress Place,
Northeast, in Concord, North Carolina for the purpose of approving the
Recapitalization Amendment and to transact such other business as may properly
come before the Special Meeting.
PROXIES
The accompanying form of proxy is for use at the Special Meeting. A
shareholder of the Company who is entitled to vote as herein described may use
this proxy if he or she is unable to attend the Special Meeting in person or
wishes to have his or her shares voted by proxy even if he or she does attend
the Special Meeting. The proxy may be revoked by the person giving it by
appearing at the Special Meeting and electing to vote in person or by
submitting a written notice of revocation or submitting a duly executed proxy
bearing a later date to CT Communications, Inc., Post Office Box 227, Concord,
North Carolina 28026-0227, Attention: Corporate Secretary. Such notice or
proxy, however, must actually be received by the Company prior to the vote of
the shareholders at the Special Meeting. All shares entitled to vote and
represented by valid proxies received pursuant to this solicitation will be
voted in the manner specified therein, if such proxies are not revoked before
they are exercised. If no specification is made, the proxies will be voted in
favor of approval of the Recapitalization Amendment.
The Board of Directors of the Company is not aware of any other matters
that may be presented for action at the Special Meeting. If other matters do
properly come before the Special Meeting, however, shares represented by
proxies in the accompanying form will be voted by the persons named in the
proxy in accordance with their best judgment.
Solicitation of proxies may be made in person or by mail, telephone or
telegraph by directors, officers and regular employees of the Company, who will
not be specially compensated for such solicitation. Nominees, fiduciaries and
other custodians will be requested to forward solicitation materials to
beneficial owners and secure their voting instructions, if necessary, and will
be reimbursed for the expenses incurred in sending proxy materials to
beneficial owners. All costs of solicitation of proxies from the shareholders
will be borne by the Company.
RECORD DATE AND VOTING RIGHTS
Only the holders of Voting Common Stock and Class B Nonvoting Common
Stock, which comprise the only classes of capital stock to be reclassified in
the Recapitalization, are entitled to vote at the Special Meeting. Holders of
shares of the Company's 4 1/2% Preferred Stock and 5% Preferred Stock will not
be affected by the Recapitalization Amendment and, accordingly, are not
entitled to vote with respect to the approval of the Recapitalization
Amendment.
The Board of Directors has fixed the close of business on December 1,
1998, as the record date for the determination of shareholders of the Company
entitled to receive notice of and to vote at the Special Meeting (the "Record
Date"). At the close of business on the Record Date, there were outstanding
336,413 shares of Voting Common Stock held by 297 holders of record and
1,955,301 shares of Class B Nonvoting Common Stock held by 1,518 holders of
record.
Each share of each class of Converted Securities is entitled to one vote
with respect to the Recapitalization Amendment. In addition, each share of
Voting Common Stock is entitled one vote as to any other proposals that may
properly come before the Special Meeting. The holders of the Class B Nonvoting
Common Stock, 4 1/2% Preferred Stock and 5% Preferred Stock are not entitled to
vote with respect to any other matter that may be presented at the Special
Meeting.
The affirmative vote of a majority of (i) the outstanding shares of Voting
Common Stock, voting as a single class, and (ii) the outstanding shares of
Class B Nonvoting Common Stock, voting as a single class, is necessary for the
approval the Recapitalization Amendment, as required by Section 55-10-04(a)(2)
of the North Carolina General Statutes (the "NCGS"). The presence, either in
person or by properly executed proxy, of the holders of a majority of the
outstanding Voting Common Stock and a majority of the outstanding Class B
Nonvoting Common Stock is necessary to constitute a quorum at the Special
Meeting.
The Company intends to count shares of Voting Common Stock and Class B
Nonvoting Common Stock that are present in person at the Special Meeting but
not voting, and shares of such stock for which the Company has received proxies
but with respect to which holders of shares have abstained, as present at the
Special Meeting for purposes of determining the presence or absence of a quorum
for the transaction of business. Brokers who hold shares in "street name" for
customers who are the beneficial owners of such shares are prohibited from
giving a proxy to vote such shares on the approval of the Recapitalization
Amendment without specific instructions from their customers. Because the NCGS
requires the affirmative
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vote of holders of a majority of the shares outstanding of each class to
approve the Recapitalization Amendment, abstentions from voting, as well as
broker non-votes, will have the effect of a vote against the approval of the
Recapitalization Amendment.
ABSENCE OF APPRAISAL RIGHTS
Under the NCGS, no shareholder of the Company is entitled to appraisal
rights in connection with the Recapitalization Amendment.
RECOMMENDATION OF BOARD OF DIRECTORS
The Board of Directors of the Company has unanimously approved the
Recapitalization Amendment and believes that the Recapitalization Amendment is
fair to, and in the best interests of, the Company and its shareholders.
ACCORDINGLY, THE BOARD OF DIRECTORS RECOMMENDS THAT THE HOLDERS OF THE
CONVERTED SECURITIES VOTE FOR ADOPTION AND APPROVAL OF THE RECAPITALIZATION
AMENDMENT AT THE SPECIAL MEETING.
THE RECAPITALIZATION AMENDMENT
THE FOLLOWING PARAGRAPHS CONTAIN CERTAIN FORWARD-LOOKING STATEMENTS THAT
INVOLVE RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE IN THE FORWARD-LOOKING STATEMENTS. WORDS SUCH AS
"EXPECTS," "ANTICIPATES," "BELIEVES," "ESTIMATES," VARIATIONS OF SUCH WORDS AND
OTHER SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY SUCH FORWARD-LOOKING
STATEMENTS.
PLAN OF RECAPITALIZATION
The Board of Directors has approved and recommends that the shareholders
approve a proposal to amend the Company's Articles of Incorporation to (i)
provide for one class of Common Stock, consisting of 100,000,000 authorized
shares, and (ii) reclassify, change and convert each issued and outstanding
share of Voting Common Stock into 4.4 shares of Common Stock, with cash being
paid in lieu of issuing fractional shares, and each issued and outstanding
share of Class B Nonvoting Common Stock into 4.0 shares of Common Stock. In
addition, all outstanding options to purchase shares of Voting Common Stock and
Class B Nonvoting Common Stock would be converted automatically into options to
purchase shares of Common Stock in an amount and at an exercise price
appropriately adjusted to reflect the respective Conversion Ratios. The full
text of the Recapitalization Amendment is attached hereto as Exhibit A.
DESCRIPTION OF COMMON STOCK
If the Recapitalization Amendment is adopted, the Company will have
100,000,000 shares of Common Stock authorized for issuance under its Articles
of Incorporation, rather than the currently authorized 18,000,000 shares
(consisting of 3,000,000 authorized shares of Voting Common Stock and
15,000,000 shares of Class B Nonvoting Common Stock). The Company would have
9,301,421 shares of Common Stock issued and outstanding as of the Record Date,
on a pro forma basis (without giving effect the payment of cash in lieu of
fractional shares), rather than 336,413 shares of Voting Common Stock and
1,955,301 shares of Class B Nonvoting Common Stock. The number of authorized
and issued and outstanding shares of the Company's 4 1/2% Preferred Stock and
5% Preferred Stock will remain the same.
In addition to the shares of Common Stock to be issued and outstanding
following the effectiveness of the Recapitalization Amendment, an aggregate of
approximately 9,850,617 shares of Common Stock would be reserved for issuance
under the Company's Rights Agreement, dated August 27, 1998 (the "Rights
Agreement") and under the Company's various stock benefit plans, calculated on
a pro forma basis as of the Record Date. Therefore, approximately 80,847,962
additional shares of Common Stock would be available for issuance from time to
time in the future for any proper corporate purposes, including equity
financing, stock splits, stock dividends, acquisitions and stock benefit plans.
In comparison, an aggregate of approximately 2,429,013 shares of Voting Common
Stock and Class B Nonvoting Common Stock were reserved for such purposes as of
the Record Date, leaving approximately 13,279,273 shares available for future
issuance. No further action or authorization by the shareholders would be
necessary prior to the issuance of additional shares of Common Stock unless
applicable laws or regulations would require such approval in a given instance.
The Company currently has no agreements, understandings or plans for the
issuance of additional shares of Common Stock, except for the reserved shares
indicated above.
Except as amended by the Recapitalization Amendment, the Company's
Articles of Incorporation will not be changed. Also, the Company's Bylaws are
not being changed. Therefore, the Common Stock will be identical to the Voting
Common
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Stock with regard to voting, distribution, dissenters', liquidation, and
preemptive rights, and in all other respects. The Common Stock will be
identical to the Class B Nonvoting Common Stock in all such respects, except
that the holders of Common Stock will be entitled to one vote per share on all
matters presented to the Company's shareholders. Holders of Class B Nonvoting
Common Stock are not entitled to vote on matters presented to the shareholders,
unless otherwise required by law.
The Board of Directors has instructed management of the Company to cause
the Common Stock to be designated for trading on the Nasdaq National Market in
the event that the shareholders approve the Recapitalization Amendment. The
Common Stock has been approved by the National Association of Securities
Dealers, Inc. for designation on the Nasdaq National Market upon notice of
issuance and is expected to begin trading on the Nasdaq National Market after
the effectiveness of the Recapitalization Amendment. The Common Stock would
trade under the symbol "CTCI." Currently, there is no established trading
market for the Voting Common Stock or the Class B Nonvoting Common Stock,
although a Charlotte-based brokerage firm is currently acting as broker for the
Class B Nonvoting Common Stock as shares are offered for sale.
The Company has engaged First Union National Bank to act as registrar and
transfer agent for the Common Stock. The Company currently serves as registrar
and transfer agent for the Voting Common Stock and the Class B Nonvoting Common
Stock.
REASONS FOR THE RECAPITALIZATION
The Board of Directors and management of the Company have, on numerous
occasions over the past two years, considered the Company's various strategic
alternatives, including the proposed Recapitalization. After thorough
consideration and discussion of such issues and in consultation with the
Company's financial and legal advisors, the Board has concluded that the
Recapitalization is advisable and in the best interests of the Company and its
shareholders. At its meeting on October 1, 1998, the Board approved the
Recapitalization and recommended the adoption of the Recapitalization Amendment
by the Company's shareholders. The Board believes that adoption of the
Recapitalization Amendment would offer a number of potential benefits to the
Company and its shareholders, which are described below.
TRADING MARKET. The conversion of the Voting Common Stock and the Class B
Nonvoting Common Stock at the respective Conversion Ratios would result in
approximately four times as many shares of common stock being outstanding. The
Board believes that having a single class of Common Stock, consisting of a
significantly larger number of outstanding shares that trade on the Nasdaq
National Market should encourage both a greater number and broader range of
investors in the Company. The Board of Directors believes that, as a result,
brokerage firms will be more willing to evaluate the Company's securities as a
possible investment opportunity for their clients and may be more willing to
act as a market maker in the Company's securities under these circumstances.
The Board believes that the result should be an increased demand for the
Company's common shares, as well as a more liquid trading market.
The Voting Common Stock and the Class B Nonvoting Common Stock have
typically traded at relatively stable prices in the past, although such trading
has been infrequent. A more liquid trading market may make the market price
more volatile. The Board cannot predict, however, what impact the
Recapitalization would have on the market prices of the Common Stock, and there
can be no assurances that the market price would increase.
INCREASE IN AUTHORIZED COMMON STOCK. As discussed above, the
Recapitalization Amendment would increase the number of authorized shares of
Common Stock from 18,000,000 to 100,000,000 and the number of shares available
for future issuance from 13,279,273 shares to 80,847,962 shares. The Board of
Directors believes that it is desirable to have additional authorized shares of
Common Stock available for possible future financings, acquisition transactions
and other general corporate purposes, including stock splits, stock dividends
and stock benefit plans. Having such additional authorized shares of Common
Stock available for issuance in the future would give the Company greater
flexibility and may allow such shares to be issued without the expense and
delay of a special shareholders meeting. Although such issuance of additional
shares in respect of future acquisitions and financings would dilute existing
equity ownership of the Company, the Company would issue such shares only if
the Board believes that such transactions ultimately would increase the value
of the Company to its shareholders.
GREATER ACCESS TO CAPITAL MARKETS. The Board of Directors believes that
the creation of a single class of Common Stock that trades on the Nasdaq
National Market will create a more liquid trading market for the Company's
shares, as described above. The Board further believes that this may allow the
Company better access to the capital markets in the event that the Company
should determine to raise capital through an offering of its Common Stock. The
Board believes that, as a result, potential investors would be more interested
in purchasing the Common Stock, thereby increasing demand in any potential
offering. Rapid changes in the telecommunications industry highlight the need
for the Company to be flexible
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in reacting to those changes and the opportunities they present. However, the
Company has no current plans to offer or sell its Common Stock, and there can
be no assurance that the Company will be able to access the capital markets at
the time, and in the amounts, desired.
GREATER ABILITY TO MAKE ACQUISITIONS. Management of the Company regularly
evaluates various acquisition alternatives and expects to continue to do so in
the foreseeable future. As described above, the Recapitalization will increase
the number of shares of Common Stock authorized for issuance, will increase the
number of shares outstanding, will simplify the Company's capital structure and
is expected to create a more liquid market for the Common Stock. The Board of
Directors believes that the Recapitalization may, therefore, enhance the
Company's ability to make acquisitions in which the Common Stock is used as the
consideration for the purchase price. The Board believes that, in such cases,
the shareholders of a target company would be more willing to accept the Common
Stock as acquisition consideration because its market value will be more
readily ascertainable and the shares will be easier to sell, if they should so
desire. Shareholders of a target company may, therefore, be more likely to
support such an acquisition by voting in favor of it or encouraging management
to pursue a transaction with the Company.
The Company does not currently have any acquisition plans, and there can
be no assurance that the Company will seek to make an acquisition or be able to
effect any acquisition if the Recapitalization Amendment is adopted.
EFFECTS ON RELATIVE OWNERSHIP AND VOTING POWER; PREMIUM PAYMENT TO VOTING
COMMON STOCK HOLDERS
Holders of the Voting Common Stock currently are the only shareholders
entitled to vote at meetings of the Company's shareholders, unless otherwise
provided by law. Heirs of L.D. Coltrane, Sr., including L.D. Coltrane, III, and
Michael R. Coltrane (the "Coltrane Family"), collectively hold a controlling
interest in the Voting Common Stock. Therefore, the Coltrane Family currently
has voting control over most matters as to which the shareholders may vote. The
Recapitalization will significantly dilute the voting control of the Company
currently held by the holders of Voting Common Stock, including the Coltrane
Family. For example, former holders of Voting Common Stock will own 15.9% of
the voting power upon the effectiveness of the Recapitalization, rather than
100%. In addition, former holders of Voting Common Stock and former holders of
Class B Nonvoting Common Stock will no longer have class voting rights in those
situations where such rights currently are required by law.
Currently, the Voting Common Stock and the Class B Nonvoting Common Stock
receive the same per share cash dividends. Furthermore, as of the Record Date,
the Voting Common Stock represented 14.7% of the outstanding common equity of
the Company, while the Class B Nonvoting Common Stock represented 85.3%. As a
result of the Recapitalization, the holders of the Class B Nonvoting Common
Stock will experience a 1.2% reduction in their interest in the aggregate of
future dividends that may be paid on the Common Stock and a 1.2% reduction in
their equity ownership of the Company. This is because the Voting Common Stock
Conversion Ratio is 10% greater than the Class B Nonvoting Common Stock
Conversion Ratio.
The Board of Directors established the relative Conversion Ratios based on
a thorough evaluation of numerous factors. In particular, the Board considered
(i) the historical difference between the per share trading price of the Voting
Common Stock and the Class B Nonvoting Common Stock, (ii) various information
regarding typical trading price differentials of the common stock of other
companies, (iii) the superior voting power of the Voting Common Stock compared
to the Class B Nonvoting Common Stock, and (iv) the benefits that should accrue
to the holders of both classes of shares if the Recapitalization Amendment is
adopted.
After considering all of these issues, the Board of Directors believes
that the Recapitalization, including the relative Conversion Ratios, is fair to
the Company's shareholders.
TAX CONSEQUENCES
THE FOLLOWING DISCUSSION IS INTENDED ONLY AS A BRIEF SUMMARY OF THE
FEDERAL INCOME TAX RULES, AS BASED ON THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE"), CURRENTLY IN EFFECT. THIS SUMMARY IS NOT MEANT TO BE
EXHAUSTIVE AND DOES NOT DESCRIBE STATE, LOCAL, FOREIGN OR OTHER TAX
CONSEQUENCES. SHAREHOLDERS SHOULD CONSULT THEIR OWN TAX ADVISOR WITH RESPECT TO
THE TAX CONSEQUENCES OF THE PROPOSED RECAPITALIZATION TO THEM INDIVIDUALLY,
INCLUDING TAX REPORTING REQUIREMENTS AND TAX CONSEQUENCES UNDER STATE, LOCAL OR
FOREIGN LAW.
No taxable income, gain or loss should be recognized by a holder of Voting
Common Stock as a result of the conversion of one share of Voting Common Stock
into 4.4 shares of Common Stock, except that cash distributed in lieu of
fractional shares will constitute taxable income for federal income tax
purposes. The cost or other basis for tax purposes of the Voting Common Stock
held immediately prior to the conversion will be allocated between the
resulting shares of Common
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Stock. No taxable income, gain or loss should be recognized by a holder of
Class B Nonvoting Common Stock as a result of the conversion of one share of
Class B Nonvoting Common Stock into 4.0 shares of Common Stock. The cost or
other basis for tax purposes of the Class B Nonvoting Common Stock held
immediately prior to the conversion will be allocated between the resulting
shares of Common Stock. The shares of Common Stock acquired in the conversion
would be deemed to have the same holding period(s) as the Voting Common Stock
and Class B Nonvoting Common Stock that are converted into Common Stock.
SECURITIES LAW ISSUES
The conversion of shares of Voting Common Stock and Class B Nonvoting
Common Stock into shares of Common Stock is not required to be registered under
the Securities Act of 1933, as amended (the "Securities Act"). At the Effective
Time, shares of Voting Common Stock or Class B Nonvoting Common Stock that have
been previously registered under the Securities Act or are otherwise
"unrestricted shares" will be deemed to be freely tradeable (unless they are
held by an affiliate of the Company, as defined in Rule 144 of the Securities
Act) and will be converted into freely tradeable shares of Common Stock. Shares
of Voting Common Stock and Class B Nonvoting Common Stock that are deemed to be
"restricted shares" under Rule 144 (which are generally identified by a legend
on the stock certificate), will be converted into restricted shares of Common
Stock. Affiliates of the Company and holders of restricted shares of Common
Stock can resell these shares in the public market in reliance on Rule 144 or
pursuant to a registration statement.
ANTI-TAKEOVER EFFECT
The Recapitalization is being proposed primarily for the reasons set forth
above, rather than as an antitakeover measure, which reasons include a more
liquid trading market, availability of additional authorized shares of Common
Stock, greater access to capital markets and greater ability to make
acquisitions. The Recapitalization is not being proposed in response to any
effort to acquire control of the Company, and the Board of Directors is not
aware of any such effort.
To the extent the Recapitalization provides the Company with a broader
shareholder base, creates a more liquid trading market and removes voting
control from the Coltrane Family, the Recapitalization may indirectly make it
easier to acquire control of the Company through a negotiated or unsolicited
tender offer or other accumulation of the Common Stock or through a proxy
contest. This is because a broader shareholder base may increase the number of
shareholders from which a potential acquiror or proxy contestant could purchase
or acquire control of a sufficient number of shares of Common Stock. The
Recapitalization may, however, also make it more difficult or expensive to take
control of the Company through such means because the Recapitalization would
dilute the concentrated voting power currently held by the holders of the
Voting Common Stock. Thus, any person or entity seeking control of the Company
would need to acquire or control a greater number of shares of Common Stock
than of Voting Common Stock, thereby making such a takeover more expensive.
Effective August 28, 1998, holders of the Voting Common Stock and the
Class B Nonvoting Common Stock received a dividend of one common share purchase
right (a "Right") for each such outstanding share pursuant to the Company's
Rights Agreement. Each Right entitles the holder to purchase one share of
Voting Common Stock or Class B Nonvoting Common Stock, as the case may be, at a
specified purchase price upon the occurrence of certain events. If the
Recapitalization Amendment is adopted by the shareholders, the Rights Agreement
and the Rights will be adjusted automatically to provide that holders of Rights
may purchase shares of Common Stock at an appropriately adjusted purchase
price. Shareholders will then receive a summary of the Rights Agreement and the
Rights, as modified.
The Rights and the provisions of the Company's Articles of Incorporation
regarding the staggered Board of Directors, removal of directors for cause
only, supermajority voting for certain business combinations and the
availability of authorized but unissued shares of Common Stock may have certain
anti-takeover effects in addition to those described above. Such provisions
could make the Company a less attractive target for a hostile takeover bid or
render it more difficult or discourage a merger proposal, the assumption of
control through the acquisition of a large block of capital stock or the
removal of incumbent management. Such provisions also may inhibit or impede
fluctuations in the market price of the Common Stock that may result from
actual or potential takeover attempts.
CONVERSION OF SHARES
If the Recapitalization Amendment is approved by the shareholders, the
Company will file the Recapitalization Amendment with the North Carolina
Secretary of State promptly after the Special Meeting. The Recapitalization
Amendment will be effective immediately upon acceptance of that filing by the
North Carolina Secretary of State (the "Effective Time"). Upon the Effective
Time and without any further action by the Company or its shareholders, each
issued and outstanding
6
<PAGE>
share of Voting Common Stock will automatically be converted into 4.4 shares of
Common Stock and each issued and outstanding share of Class B Nonvoting Common
Stock will be converted automatically into 4.0 shares of Common Stock. In
addition, all outstanding options to purchase shares of Voting Common Stock and
Class B Nonvoting Common Stock will be converted automatically into options to
purchase shares of Common Stock in an amount and at an exercise price
appropriately adjusted to reflect the respective Conversion Ratios.
No fractional shares will be issued in connection with the
Recapitalization. Rather, holders of Voting Common Stock who would otherwise be
entitled to receive a fraction of a share of Common Stock (after taking into
account all certificates held by such shareholder) will receive in lieu thereof
cash (without interest) in an amount equal to such fractional part of a share
of Common Stock multiplied by $145.00 (the "Voting Common Stock Market Value").
The Voting Common Stock Market Value equals the price at which shares of Voting
Common Stock were sold on September 17, 1998 (which is the last known arms
length sale of Voting Common Stock) divided by 4.4 to reflect the Voting Common
Stock Conversion Ratio. No holder of Voting Common Stock will be entitled to
dividends, voting rights or any other rights as a shareholder in respect of any
fractional share. The Class B Nonvoting Common Stock Conversion Ratio will not
result in any fractional shares.
Promptly after the Effective Time, First Union National Bank (the
"Transfer Agent") will mail to each record holder of a stock certificate
representing shares of the Converted Securities instructions and transmittal
materials for effecting the surrender of stock certificates representing shares
of the Converted Securities in exchange for replacement certificates
representing the number of whole shares of Common Stock into which such shares
of the Converted Securities have been converted.
SHAREHOLDERS ARE REQUESTED NOT TO SEND ANY STOCK CERTIFICATES WITH THE
ENCLOSED PROXY, AND NOT TO SURRENDER STOCK CERTIFICATES FOR EXCHANGE, UNTIL
THEY RECEIVE SUCH TRANSMITTAL MATERIALS FROM THE TRANSFER AGENT.
After receipt of the transmittal materials from the Transfer Agent,
shareholders may complete and return such materials to the Transfer Agent along
with the certificate or certificates representing their shares of the Converted
Securities. Upon delivery of such materials and certificates to the Transfer
Agent by a shareholder, the shareholder will be entitled to receive a new stock
certificate representing the number of whole shares of Common Stock into which
such shares of the Converted Securities have been converted (as represented by
the certificate or certificates surrendered to the Transfer Agent) and, where
applicable, a check for the amount (without interest) representing the value of
any fractional shares. Until surrendered, each stock certificate will represent
for all purposes the number of whole shares of Common Stock into which the
shares represented by such certificate were converted at the Effective Time, as
determined by the Transfer Agent's records. Such shareholders shall be entitled
to vote at any shareholders meetings (to the extent permitted by law) and to
receive any dividends or other distributions on the Common Stock.
If any new certificate representing shares of Common Stock is to be issued
in a name or number of shares other than that in which or in respect of which
the surrendered certificate is registered, it will be a condition to such
issuance that the person requesting such issuance deliver to the Transfer Agent
all documents necessary to evidence and effect such transfer (with signature
guarantees) and pay to the Transfer Agent any transfer or other taxes required
by reason thereof or establish to the Transfer Agent's satisfaction that such
taxes have been paid or are not applicable. In the event any certificate
representing shares of the Converted Securities has been lost, stolen or
destroyed, the Transfer Agent will issue a new certificate representing the
number and class of shares into which the shares represented by such
certificate were converted pursuant to the recapitalization upon the making of
an affidavit of that fact by the person claiming such certificate to be lost,
stolen or destroyed. As a condition precedent to such issuance, the Company may
require a bond in such sum as the Company may direct to indemnify the Company
against any claim that may be made against the Company with respect to the
certificate that is alleged to have been lost, stolen or destroyed.
7
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table presents information regarding the beneficial
ownership by all directors and executive officers of the Company of the
Company's various classes of equity securities as of October 15, 1998. In
addition, the table presents information regarding each shareholder known to
the Company to beneficially own more than 5% of the Voting Common Stock, which
is the only class of securities of the Company with general voting rights.
Unless otherwise noted, all shares set forth in the table are directly owned,
with sole voting and investment power, by such shareholder.
<TABLE>
<CAPTION>
VOTING COMMON STOCK
BENEFICIALLY OWNED
--------------------------
% OF
NAME (1) NUMBER CLASS
- ----------------------------------------------------- --------------- ----------
<S> <C> <C>
L. D. Coltrane III 51,101(3) 15.2%
P.O. Box 227
Concord, NC 28026-0227
Michael R. Coltrane 43,786(5) 13.0%
P.O. Box 227
Concord, NC 28026-0227
Betty Gay Bivens 42,943 13.0%
400 Avinger Lane
Davidson, NC 28036
Phyllis C. Ausband 33,932(7) 10.1%
2310 Coventry Lane
Daleville, VA 24083
First Charter National Bank 26,121(9) 7.8%
Trust Department
P.O. Box 228
Concord, NC 28026-0228
Mariam C. Schramm 23,287 6.9%
(Mrs. T. M. Schramm)
400 Avinger Lane
Davidson, NC 28036
World Division Board of Global Ministries 22,643 6.7%
United Methodist Church
475 Riverside Drive
15th Floor
New York, NY 10027
Phil W. Widenhouse 3,651(11) 1.1%
Jerry H. McClellan 694(13) *
O. C. Chewning, Jr 557 *
Ben F. Mynatt 514(15) *
John R. Boger, Jr. 195(16) *
Thomas A. Norman 150 *
Catherine A. Duda 128 *
S. E. Leftwich 82 *
Kenneth R. Argo 68 *
Nicholas L. Kottyan 45 *
Barry R. Rubens 30 *
All directors and executive officers of the Company 143,944 42.9%
as a group (14 persons) (23)
<CAPTION>
COMMON STOCK TO BE
CLASS B NONVOTING COMMON OWNED AFTER
STOCK BENEFICIALLY OWNED RECAPITALIZATION (2)
---------------------------- ----------------------
% OF % OF
NAME (1) NUMBER CLASS NUMBER CLASS
- ----------------------------------------------------- ------------------ --------- ------------ ---------
<S> <C> <C> <C> <C>
L. D. Coltrane III 2,419(4) * 234,520 2.5%
P.O. Box 227
Concord, NC 28026-0227
Michael R. Coltrane 36,269(6) 1.9% 337,734 3.6%
P.O. Box 227
Concord, NC 28026-0227
Betty Gay Bivens 9,649 * 227,545 2.4%
400 Avinger Lane
Davidson, NC 28036
Phyllis C. Ausband 26,244(8) 1.3% 254,276 2.7%
2310 Coventry Lane
Daleville, VA 24083
First Charter National Bank 101,849(10) 5.2% 522,328 5.6%
Trust Department
P.O. Box 228
Concord, NC 28026-0228
Mariam C. Schramm 106,631 5.5% 528,986 5.7%
(Mrs. T. M. Schramm)
400 Avinger Lane
Davidson, NC 28036
World Division Board of Global Ministries 245,304 12.5% 1,080,845 11.6%
United Methodist Church
475 Riverside Drive
15th Floor
New York, NY 10027
Phil W. Widenhouse 21,509(12) 1.1% 102,100 1.1%
Jerry H. McClellan 6,182(14) * 27,781 *
O. C. Chewning, Jr 534 * 4,586 *
Ben F. Mynatt 2,579 * 12,577 *
John R. Boger, Jr. 777(17) * 3,966 *
Thomas A. Norman 5,888(18) * 24,212 *
Catherine A. Duda 1,271(19) * 5,647 *
S. E. Leftwich 437 * 2,108 *
Kenneth R. Argo 4,422(20) * 17,987 *
Nicholas L. Kottyan 5,306(21) * 21,422 *
Barry R. Rubens 5,368(22) * 21,604 *
All directors and executive officers of the Company 102,660 5.2% 1,043,993 11.1%
as a group (14 persons) (23)
</TABLE>
- ---------
* Less than 1%
(1) Addresses are provided for persons owning more than 5% of the outstanding
shares of Voting Common Stock. All other persons are directors or
executive officers of the Company.
(2) Pro forma to reflect the conversion of the Voting Common Stock at the
4.4-to-one Conversion Ratio and the conversion of the Class B Nonvoting
Common Stock at the 4.0-to-one Conversion Ratio.
(3) Includes 7,131 shares owned by spouse.
8
<PAGE>
(4) Includes 13 shares owned by spouse.
(5) Includes 21,793 shares held by trusts for which Mr. Coltrane is a
co-trustee with Phyllis C. Ausband, his sister, with whom he shares voting
and investment power, and 1,308 shares owned by spouse.
(6) Includes 15,466 shares held by trusts for which Mr. Coltrane is a
co-trustee with Phyllis C. Ausband, his sister, with whom he shares voting
and investment power, 225 shares owned by spouse, and 5,766 shares
represented by currently exercisable options.
(7) Includes 21,793 shares held by trusts for which Ms. Ausband is a co-trustee
with Michael R. Coltrane, her brother, with whom she shares voting and
investment power, and 87 shares owned by spouse.
(8) Includes 15,466 shares held by trusts for which Ms. Ausband is a co-trustee
with Michael R. Coltrane, her brother, with whom she shares voting and
investment power.
(9) Includes 16,173 shares held by two employee retirement plans of the Company
for which First Charter National Bank ("FCNB") serves as trustee and 9,948
shares held by various trusts for which FCNB serves as trustee. FCNB has
sole or shared voting and investment power over all such shares.
(10) Includes 21,046 shares held by two employee retirement plans of the
Company for which FCNB serves as trustee and 80,805 shares held by various
trusts for which FCNB serves as trustee. FCNB has sole or shared voting
and investment power over all such shares.
(11) Includes 189 shares owned by spouse.
(12) Includes 12,627 shares owned by spouse.
(13) Includes 202 shares owned by spouse.
(14) Includes 1,607 shares owned by spouse and 562 shares represented by
currently exercisable options.
(15) Includes 487 shares owned by spouse.
(16) Includes 145 shares owned by spouse.
(17) Includes 112 shares owned by spouse.
(18) Includes 3,468 shares represented by currently exercisable options.
(19) Includes 573 shares represented by currently exercisable options.
(20) Includes 484 shares owned by spouse and 109 shares represented by
currently exercisable options.
(21) Includes 3,482 shares represented by currently exercisable options.
(22) Includes 3,582 shares represented by currently exercisable options.
(23) Includes an aggregate of 17,542 shares of Class B Nonvoting Common Stock
represented by currently exercisable options. Does not include 26,121
shares of Voting Common Stock or 101,849 shares of Class B Nonvoting
Common Stock held by FCNB. L. D. Coltrane III and Michael R. Coltrane are
shareholders and Michael R. Coltrane is a director of First Charter
Corporation, the parent corporation of FCNB. None of the directors or
executive officers of the Company owned any shares of the Company's 4 1/2%
Preferred Stock or 5% Preferred Stock as of October 15, 1998.
SHAREHOLDER PROPOSALS
The deadline for submission of shareholder proposals pursuant to Rule
14a-8 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), for inclusion in the Company's proxy statement for its 1999 annual
meeting of shareholders was November 20, 1998. Additionally, any shareholder
proposal to be submitted at the 1999 Annual Meeting of Shareholders (but not
required to be included in the Company's proxy statement) must be received by
the Company on or before February 2, 1999. A proposal received after such date
will be considered untimely pursuant to Rules 14a-4 and 14a-5(e) under the
Exchange Act, and the persons named in proxies solicited by the Board of
Directors of the Company for its 1999 Annual Meeting of Shareholders may
exercise discretionary voting power with respect to such proposal.
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors of the
Company knows of no matters that will be presented for consideration at the
Special Meeting other than as described in this Proxy Statement. However, if
any other matters shall come before the Special Meeting or any adjournment or
postponement thereof and be voted upon, the enclosed proxies shall be deemed to
confer discretionary authority to the individuals named as proxies therein to
vote the shares represented by such proxy as to any such matters.
9
<PAGE>
(This Page Intentionally Left Blank)
<PAGE>
EXHIBIT A
TEXT OF THE RECAPITALIZATION AMENDMENT
If the Recapitalization Amendment is approved, Article 2 of the Company's
Articles of Incorporation, which sets forth the Company's currently authorized
capital stock, will be amended by deleting Article 2 in its entirety and
substituting the following therefor:
The aggregate number of shares which the Corporation shall have authority
to issue is 100,019,000 shares of capital stock, which shall be classified and
bear designations as follows:
(a) 100,000,000 shares of common stock designated as Common Stock.
(b) 2,000 shares of preferred stock designated as Four and One-half
Percent Preferred Stock.
(c) 17,000 shares of preferred stock designated as Five Percent Preferred
Stock.
Each share of Voting Common Stock of the Corporation outstanding when
these Articles of Amendment become effective, shall be reclassified, changed
and converted into 4.4 fully paid and nonassessable shares of Common Stock,
with cash to be paid in lieu of any fractional shares. Each share of Class B
Nonvoting Common Stock of the Corporation issued and outstanding when these
Articles of Amendment become effective, shall be reclassified, changed and
converted into 4.0 fully paid and nonassessable shares of Common Stock. In
addition, all outstanding options to purchase shares of Voting Common Stock and
Class B Nonvoting Common Stock shall be converted automatically into options to
purchase shares of Common Stock in an amount and at an exercise price
appropriately adjusted to reflect the foregoing conversion ratios.
<PAGE>
<PAGE>
***********************************APPENDIX***********************************
VOTING COMMON STOCK
This Proxy is Solicited on Behalf
of the Board of Directors of
CT COMMUNICATIONS, INC.
SPECIAL MEETING OF SHAREHOLDERS, JANUARY 28, 1999
KNOW ALL MEN BY THESE PRESENT, that the undersigned shareholder of CT
COMMUNICATIONS, INC., a North Carolina corporation (the "Company"), hereby
constitutes and appoints L. D. Coltrane III, Michael R. Coltrane and Barry R.
Rubens, attorneys and proxies with full power of substitution, for and on
behalf of the undersigned to act and vote as indicated below, according to the
number of shares of the Company's Voting Common Stock held of record by the
undersigned on December 1, 1998, and as fully as the undersigned would be
entitled to act and vote if personally present at the Special Meeting of
Shareholders to be held at the Company's Customer Care Facility, 2000 Progress
Place, Concord, North Carolina, at 9:00 a. m., local time, January 28, 1999,
and any adjournment or adjournments thereof (the "Special Meeting"), as
follows:
(1) Approval of an amendment to the Company's Articles of Incorporation to
(a) provide for one class of Common Stock, consisting of 100,000,000
authorized shares, and (b) reclassify, change and convert each issued and
outstanding share of the Company's Voting Common Stock into 4.4 shares of
Common Stock and each issued and outstanding share of Class B Nonvoting
Common Stock into 4.0 shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(2) In their discretion, the proxies are authorized to act and vote upon
any other business which may properly be brought before said meeting or
any adjournment or adjournments thereof.
<PAGE>
The undersigned hereby ratifies and confirms all that said attorneys and
proxies or any of them lawfully do or cause to be done by virtue hereof. A
majority of said attorneys and proxies who shall be present and acting as such
at the Special Meeting or any adjournment thereof, or if only one such attorney
and proxy be present and acting, then that one, shall have and may exercise all
powers hereby conferred.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED IN FAVOR OF PROPOSAL 1.
The undersigned hereby
acknowledges receipt of the
Notice of Special Meeting of
Shareholders, dated December 11,
1998, and the Proxy Statement
furnished therewith.
Dated this __ day of ___________,
199_.
__________________________ (SEAL)
__________________________ (SEAL)
NOTE: Signature should agree with
name on stock certificate as
printed thereon. When shares are
held by joint tenants, both
should sign. Executors,
administrators, trustees and
other fiduciaries, and persons
signing on behalf of corporations
or partnerships, should so
indicate when signing.
PLEASE MARK, DATE, SIGN AND RETURN
THIS PROXY PROMPTLY. THANK YOU.
<PAGE>
CLASS B NONVOTING COMMON STOCK
This Proxy is Solicited on Behalf
of the Board of Directors of
CT COMMUNICATIONS, INC.
SPECIAL MEETING OF SHAREHOLDERS, JANUARY 28, 1999
KNOW ALL MEN BY THESE PRESENT, that the undersigned shareholder of CT
COMMUNICATIONS, INC., a North Carolina corporation (the "Company"), hereby
constitutes and appoints L. D. Coltrane III, Michael R. Coltrane and Barry R.
Rubens, attorneys and proxies with full power of substitution, for and on
behalf of the undersigned to act and vote as indicated below, according to the
number of shares of the Company's Class B Nonvoting Common Stock held of record
by the undersigned on December 1, 1998, and as fully as the undersigned would
be entitled to act and vote if personally present at the Special Meeting of
Shareholders to be held at the Company's Customer Care Center, 2000 Progress
Place, Concord, North Carolina, at 9:00 a. m., local time, January 28, 1999,
and any adjournment or adjournments thereof (the "Special Meeting"), as
follows:
(1) Approval of an amendment to the Company's Articles of Incorporation to
(a) provide for one class of Common Stock, consisting of 100,000,000
authorized shares, and (b) reclassify, change and convert each issued and
outstanding share of the Company's Voting Common Stock into 4.4 shares of
Common Stock and each issued and outstanding share of Class B Nonvoting
Common Stock into 4.0 shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
<PAGE>
The undersigned hereby ratifies and confirms all that said attorneys and
proxies or any of them lawfully do or cause to be done by virtue hereof. A
majority of said attorneys and proxies who shall be present and acting as such
at the Special Meeting or any adjournment thereof, or if only one such attorney
and proxy be present and acting, then that one, shall have and may exercise all
powers hereby conferred.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED IN FAVOR OF PROPOSAL 1.
The undersigned hereby
acknowledges receipt of the
Notice of Special Meeting of
Shareholders, dated December 11,
1998, and the Proxy Statement
furnished therewith.
Dated this ___ day of __________,
199_.
___________________________(SEAL)
___________________________(SEAL)
NOTE: Signature should agree with
name on stock certificate as
printed thereon. When shares are
held by joint tenants, both
should sign. Executors,
administrators, trustees and
other fiduciaries, and persons
signing on behalf of corporations
or partnerships, should so
indicate when signing.
PLEASE MARK, DATE, SIGN AND RETURN
THIS PROXY PROMPTLY. THANK YOU.
