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
CENTRAL FIDELITY BANKS, 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:
<PAGE>
[CENTRAL FIDELITY LOGO]
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
- --------------------------------------------------------------------------------
CENTRAL FIDELITY BANKS, INC.
Executive Offices
1021 E. Cary Street
Post Office Box 27602
Richmond, Virginia 23261-7602
To the Shareholders:
The Annual Meeting of Shareholders of Central Fidelity Banks, Inc. will be
held in the banking hall of Central Fidelity National Bank, Broad at Third
Street, Richmond, Virginia, at 4:30 p.m. on May 14, 1997:
(1) To elect four directors comprising Class 3 to three year terms of
office; and
(2) To transact any other business which may properly come before the
meeting.
The Board of Directors has fixed the close of business on March 14, 1997 as
the record date for the determination of shareholders entitled to notice of, and
to vote at, the meeting.
Shareholders are cordially invited to attend the meeting in person.
REGARDLESS OF YOUR ATTENDANCE PLANS, PLEASE FILL IN, DATE AND SIGN THE ENCLOSED
PROXY CARD AND MAIL IT IN THE ACCOMPANYING ADDRESSED AND POSTPAID ENVELOPE. The
proxy may be revoked at any time before it is voted.
Your attention is directed to the accompanying Proxy Statement.
By Order of the Board of Directors,
WILLIAM N. STOYKO
SECRETARY
March 31, 1997
<PAGE>
[CENTRAL FIDELITY LOGO]
PROXY STATEMENT
- --------------------------------------------------------------------------------
CENTRAL FIDELITY BANKS, INC.
Executive Offices
1021 E. Cary Street
Post Office Box 27602
Richmond, Virginia 23261-7602
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 14, 1997
GENERAL
This Proxy Statement and the accompanying form of proxy, mailed to
shareholders on or about March 31, 1997 are furnished in connection with the
solicitation of proxies on behalf of the Board of Directors (the "Board") of
Central Fidelity Banks, Inc. (the "Company") for use at the Annual Meeting of
Shareholders (the "Meeting") to be held at 4:30 p.m. on May 14, 1997 in the
banking hall of Central Fidelity National Bank, Broad at Third Street, Richmond,
Virginia and at any adjournment thereof. The cost of soliciting proxies will be
borne by the Company. In addition to solicitation by mail, the Company will
request banks, brokers and other custodians, nominees and fiduciaries to send
proxy material to the beneficial owners and to secure their voting instructions,
if necessary. The Company, upon request, will reimburse them for their expenses
in so doing. Officers and regular employees of the Company may solicit proxies
personally, by telephone or telegram from some shareholders if proxies are not
received promptly. In addition, the Company has retained Morrow & Company, Inc.
to aid in the solicitation of proxies at an estimated cost of $4,500, plus
out-of-pocket expenses.
The Board has fixed the close of business on March 14, 1997 as the record
date for the determination of shareholders entitled to notice of, and to vote
at, the Meeting.
A proxy in the accompanying form which is properly signed and returned and
not revoked will be voted in accordance with instructions contained therein. Any
shareholder giving a proxy may revoke it at any time before it is exercised by
executing another proxy or by appearing at the Meeting and voting in person.
The Company's Annual Report to Shareholders and Form 10-K for the year
ended December 31, 1996 is being sent to all shareholders concurrently with this
Proxy Statement. Said Annual Report and Form 10-K is not to be considered a part
of the proxy soliciting material.
1
<PAGE>
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
At the Meeting, each outstanding share of the Company's $5.00 par value
common stock ("Common Stock") will be entitled to one vote on all matters
submitted to the shareholders. There are no cumulative voting rights. As of
March 14, 1997, there were 58,629,450 shares of the Common Stock outstanding and
entitled to vote.
On March 14, 1997 the trust department of the Company's wholly-owned
banking subsidiary, Central Fidelity National Bank (the "Bank"), in its capacity
as the trustee for the Company's Stock and Thrift Plan, held on behalf of
officers and other employees an aggregate of 5,322,926 shares (9.08%) of the
outstanding Common Stock. Participants in this plan retain the power to vote
their individual shares.
The following table lists the only shareholder known by the Company to be
the beneficial owner of more than five percent of the outstanding Common Stock.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP COMMON STOCK
- ---------------------------------- --------------------- ------------
<S> <C> <C>
The Capital Group Companies, Inc. 5,475,650 shares (1) 9.2%
Capital Research and
Management Company
333 South Hope Street
Los Angeles, California 90071
</TABLE>
- ---------------
(1) The following information was obtained from a Schedule 13G filed jointly by
The Capital Group Companies, Inc. and its wholly-owned subsidiary, Capital
Research and Management Company, with the Securities and Exchange Commission
for the year ended December 31, 1996. The Capital Group Companies, Inc., as
parent holding company of a group of investment management companies, held
sole power to vote, or to direct the voting of 1,788,650 shares and sole
power to dispose, or to direct the disposition, of all 5,475,650 shares. Of
those shares, Capital Research and Management Company held the sole power to
dispose, or to direct the disposition, of 3,312,150 shares or 5.6% of Common
Stock, but held no power to vote, or to direct the voting over, the shares,
as a result of acting as investment advisor to various investment companies
registered under Section 8 of the Investment Company Act of 1940. The
remaining shares reported as beneficially owned by The Capital Group
Companies, Inc. were beneficially owned by Capital Guardian Trust Company,
another wholly-owned subsidiary.
QUORUM AND VOTE REQUIRED
Under the Company's By-Laws, a majority of the shares of Common Stock,
present in person or represented by proxy, shall constitute a quorum for
purposes of the Meeting. If a quorum is present, the affirmative vote of the
majority of the shares present in person or represented by proxy at the Meeting
and entitled to vote on the subject matter shall be the act of the shareholders
with respect to any proposal other than the election of directors. In the
election of directors, those receiving the greatest number of votes shall be
deemed elected even though not receiving a majority. The tabulation of votes for
all proposals and the election of directors shall be managed by three judges
appointed by the Board who shall certify the results to the Secretary of the
Company. Abstentions are treated as votes against a proposal, and broker
non-votes have no effect on the vote.
2
<PAGE>
ELECTION OF DIRECTORS
The Company's Restated Articles of Incorporation provide for the Board of
Directors to be divided into three classes, as nearly equal in number as
possible, each of which will serve for three years, with one class being elected
each year.
At the 1997 Meeting, four directors comprising Class 3 will be elected to
serve until the 2000 Annual Meeting of Shareholders and until their successors
are elected and qualified. The Board recommends that the four nominees named
below be elected. Proxies received will be voted for the election of such
nominees unless marked to the contrary. A shareholder who desires to withhold
voting of the proxy for all or one or more of the nominees may so indicate on
the proxy. All of said nominees are currently members of the Board. All have
consented to be named and have indicated their intent to serve if elected.
However, in the event any such nominee is not available for election, the
proxies will be voted for such person as shall be designated by the Board as a
replacement.
There is set forth hereafter as to each of the nominees, and the remaining
directors who will continue to serve as indicated below, certain information
including age, principal occupation and, as of January 31, 1997, information
respecting beneficial ownership of Common Stock. The dates shown for first
election as a director in the information below represents the year in which the
nominee or continuing director was first elected to the Board of the Company or
one of its predecessor corporations. Unless otherwise indicated, the business
experience and principal occupations shown for each nominee or continuing
director has extended five or more years.
NOMINEES FOR ELECTION
CLASS 3 DIRECTORS -- NOMINEES FOR ELECTION TO SERVE UNTIL THE 2000 ANNUAL
MEETING
JAMES F. BETTS, 64, a director since 1973. Mr. Betts is a retired independent
management consultant and former Chairman of the Board and President of The
Life Insurance Company of Virginia. Mr. Betts is a member of the Compensation,
Executive and Nominating Committees.
PHYLLIS L. COTHRAN, 50, a director since 1994. Ms. Cothran served as President
and Chief Operating Officer of Trigon Blue Cross Blue Shield, Richmond,
Virginia until March 31, 1997 and is also a director of Tredegar Industries,
Inc. and Ethyl Corporation. Ms. Cothran is a member of the Audit Committee.
G. BRUCE MILLER, 61, a director since 1982. Mr. Miller is President and Chief
Executive Officer of International Home Furnishings Center, Inc., High Point,
North Carolina. Mr. Miller is a member of the Executive and Nominating
Committees.
KENNETH S. WHITE, 57, a director since 1976. Mr. White is an attorney at law and
a principal in the law firm of Edmunds & Williams, P.C., Lynchburg, Virginia.
Mr. White is a member of the Executive and Nominating Committees and is
Chairman of the Compensation Committee.
3
<PAGE>
DIRECTORS CONTINUING TO SERVE
CLASS 1 DIRECTORS -- ELECTED TO SERVE UNTIL THE 1998 MEETING
JACK H. FERGUSON, 65, a director since 1986. Mr. Ferguson, retired, was
President and Chief Executive Officer of So-Deep, Inc., Manassas, Virginia, a
subsurface utility engineering firm until March 1992. Mr. Ferguson is also a
former President and Chief Executive Officer of Virginia Electric and Power
Company, Richmond, Virginia. Mr. Ferguson is a member of the Public Policy
Committee.
LEWIS N. MILLER, JR., 53, a director since 1984. Mr. Miller is Chairman,
President and Chief Executive Officer of the Company and of Central Fidelity
National Bank, the principal subsidiary of the Company. Mr. Miller is a member
of the Executive, Nominating and Public Policy Committees.
RICHARD L. MORRILL, 57, a director since 1989. Dr. Morrill is President of the
University of Richmond, Richmond, Virginia. Dr. Morrill is a member of the
Public Policy Committee.
LLOYD U. NOLAND, III, 53, a director since 1987. Mr. Noland is Chairman of the
Board, President and a director of the Noland Company, Newport News, Virginia,
a supplier of industrial products. Mr. Noland is Chairman of the Audit
Committee.
WILLIAM G. REYNOLDS, JR., 58, a director since 1977. Mr. Reynolds is Vice
President, Government Relations and Public Affairs of Reynolds Metals Company,
Richmond, Virginia, producers of aluminum and aluminum products. Mr. Reynolds
is a member of the Audit Committee.
CLASS 2 DIRECTORS -- ELECTED TO SERVE UNTIL THE 1999 MEETING
ALVIN R. CLEMENTS, 69, a director since 1974. Mr. Clements, a Charlottesville,
Virginia consultant, was Chairman of the Board of the Company prior to 1982.
Mr. Clements is a member of the Executive Committee.
THOMAS R. GLASS, 68, a director since 1978. Mr. Glass is Publisher Emeritus of
The News and The Daily Advance and former President and Chief Executive
Officer of Carter Glass Newspaper Group, Lynchburg, Virginia. Mr. Glass is a
member of the Audit Committee.
GEORGE R. LEWIS, 56, a director since 1985. Mr. Lewis is Vice President and
Treasurer of Philip Morris Companies Inc., New York, New York, producers of
cigarettes, beverages and food products, and is a director of Ceridian
Corporation. Mr. Lewis is a member of the Executive and Compensation
Committees.
T. JUSTIN MOORE, III, 41, a director since 1996. Mr. Moore is a partner in the
law firm of Hunton & Williams, Richmond, Virginia. Mr. Moore is a member of
the Public Policy Committee.
4
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information as of January 31, 1997,
regarding the number of shares of Common Stock beneficially owned by all
directors and nominees, by each of the executive officers named in the "Summary
Compensation Table" herein and by all directors and executive officers as a
group. Beneficial ownership includes shares, if any, held in the name of, or
jointly with, the spouse, minor children or other relatives of the director or
executive officer living in such person's home, as well as shares, if any, held
in the name of another person under an arrangement whereby the director or
executive officer has voting or investment authority over such shares or can
vest title in himself or herself at once or at some future time.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL PERCENT OF
NAME OF BENEFICIAL OWNER OWNERSHIP(1) CLASS
- ------------------------------------------------------------ -------------------- ----------
<S> <C> <C>
James F. Betts.............................................. 41,148 *
Alvin R. Clements........................................... 60,435 *
Phyllis L. Cothran.......................................... 6,322 *
Rodger W. Fauber............................................ 128,602 *
Jack H. Ferguson............................................ 10,770 *
Robert L. Freeman........................................... 55,596 *
Thomas R. Glass............................................. 32,864 *
Philip G. Hug............................................... 122,144 *
George R. Lewis............................................. 7,467 *
Jay O. Livingston........................................... 146,254 *
G. Bruce Miller............................................. 28,469 *
Lewis N. Miller, Jr......................................... 345,041 *
T. Justin Moore, III........................................ 3,772 *
Richard L. Morrill.......................................... 5,144 *
Lloyd U. Noland, III........................................ 143,961 *
John T. Percy, Jr........................................... 125,659 *
William G. Reynolds, Jr..................................... 18,830 *
Kenneth S. White............................................ 23,603 *
All directors and executive officers as a group............. 2,113,600 3.58%
</TABLE>
- ---------------
(1) Includes beneficial ownership of the following shares which may be acquired
within 60 days of January 31, 1997 pursuant to stock options by: Mr. Fauber,
54,937 shares; Mr. Hug, 25,436 shares; Mr. Livingston, 72,900 shares; Mr.
Lewis N. Miller, Jr., 184,486 shares; Mr. Percy, 58,328 shares; and all
directors and executive officers as a group, 937,441 shares.
* No individual director, nominee for director or named officer beneficially
owns 1% or more of Common Stock.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board held six meetings in 1996. The Board has five standing committees
to assist it in the discharge of its responsibilities: the Executive Committee,
Audit Committee, Nominating Committee, Compensation Committee and Public Policy
Committee. Respective memberships on these committees are identified in the
information on pages 3 and 4 hereof.
5
<PAGE>
The Executive Committee consists of seven members, including Lewis N.
Miller, Jr. Except to increase the number of directors, to fill vacancies on the
Board, or to approve an amendment to the Restated Articles of Incorporation, a
plan of merger or consolidation or other matters which cannot by law be
delegated by the Board, the Executive Committee has all the powers of the Board
in the management and the conduct of the business and affairs of the Company in
the intervals between meetings of the full Board. The Executive Committee held
two meetings during 1996.
The Compensation Committee consists of three non-employee directors who
oversee and approve compensation and other benefits for the Company's executive
officers. The Compensation Committee held one meeting during 1996.
The Audit Committee consists of four members, all non-employee directors.
In general, this Committee is charged with ascertaining that the affairs and
operations of the Company and its subsidiaries are subject to proper audit and
control procedures, with monitoring the Company's business ethics policies and
activities and with assuring that the Company's auditors are free to exercise
their function independently of management. The Audit Committee held four
meetings during 1996.
The Public Policy Committee consists of Mr. Miller and three non-employee
directors. This Committee was established by the Board to review charitable
contributions of the Company and to oversee the Company's involvement in
community programs and its compliance with the Community Reinvestment Act and
civil rights acts. The Public Policy Committee held one meeting during 1996.
The Nominating Committee consists of Mr. Miller and three non-employee
directors. This Committee was established by the Board to review qualifications
of possible candidates and to recommend candidates to the Board as nominees for
election by the shareholders or by the Board to fill such vacancies as may occur
during the year. The Nominating Committee held one meeting during 1996.
Section 2.13 of the Company's By-Laws provides that nominations of persons
for election as directors may be made only by or at the direction of the Board
or by any shareholder entitled to vote for the election of directors at a
meeting of the shareholders upon compliance with the provisions of said By-Laws.
Shareholders intending to nominate candidates for election as directors at a
shareholders' meeting shall do so by notice in writing delivered to the
Secretary of the Company, or mailed and received by the Company, not less than
60 days nor more than 90 days prior to the meeting (except that, if public
disclosure of the meeting date is made less than 70 days prior to the meeting,
the notice need only be received within 10 days following such public
disclosure). In addition, such notice must set forth the following information:
the name and address and the class and number of shares of Common Stock which
are beneficially owned by the nominating shareholder; the name, age, principal
occupation or employment, and business and residence addresses of each nominee;
as well as any other information relating to each nominee as is required to be
disclosed in solicitations of proxies for election of directors, or is otherwise
required, in each case pursuant to Regulation 14A under the Securities Exchange
Act of 1934, as amended, including such person's written consent to be named in
the proxy statement as a nominee and to serve as a director, if elected.
During 1996, all of the Company's incumbent directors attended at least 75%
of the meetings of the Board and the committees on which they serve.
6
<PAGE>
DIRECTOR COMPENSATION
The Company's Compensation Plan for Non-Employee Directors (the "Directors'
Plan") provides that director retainer fees and meeting fees may, at the
election of the individual director, be paid in cash or deferred in the form of
equivalents of Common Stock for distribution at a determined future date. The
number of shares of Common Stock equivalents deferred for the account of any
director for any calendar quarter shall be determined by dividing the amount of
director's fees deferred by the non-employee director for such calendar quarter
by the fair market value of the Common Stock on the last business day of the
calendar quarter in which such director's fees were earned.
In 1996, directors who were not officers received a $15,750 retainer in the
form of cash or Common Stock equivalents for services as a director. The
Chairman of the Audit Committee and Chairman of the Compensation Committee each
received an additional $3,000 in cash or Common Stock equivalents. Directors
also received $1,200 in cash or Common Stock equivalents per Board or committee
meeting ($600 in cash or Common Stock equivalents per committee meeting if on a
Board meeting date) attended.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors is comprised of three
outside directors: Kenneth S. White, Chairman; George R. Lewis; and James F.
Betts. Mr. Betts replaced T. Justin Moore, Jr. as a member of the Compensation
Committee following Mr. Moore's retirement from the Board in May, 1996. None of
the individuals who served on the Compensation Committee is an officer or
employee or former officer or employee of the Company or any of its
subsidiaries. None of the executive officers of the Company served on the board
of directors or compensation committee of any company for which a Compensation
Committee member or other Board member served as an executive officer.
During 1996, the Company and its subsidiaries utilized the legal services
of Edmunds & Williams, P.C. and Hunton & Williams. Kenneth S. White is a
principal in Edmunds & Williams, and former director T. Justin Moore, Jr. served
as Of Counsel to Hunton & Williams. The amount of fees paid to each firm did not
exceed 5% of that firm's gross revenues during its last fiscal year. Management
believes that these firms provided legal services to the Company on terms as
favorable as could have been obtained from other firms.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The principal objective of the Company's Compensation Committee (the
"Committee") is to develop comprehensive policies designed to attract, motivate
and retain the executive management necessary to enhance the profitability of
the Company and increase shareholder value. Total compensation opportunities are
intended to be competitive with those offered by employers of comparable size,
represented by asset level and performance in the banking industry.
In the past several years executive compensation in the Company had
consisted of base salary and stock options. Due to the lack of any annual bonus
incentives prior to 1996, the base salaries of executive officers constituted
their total annual cash compensation. Although the Company's executive cash
compensation program has been competitive at the total cash level, the
Compensation Committee has approved a strategy of decreasing the percentage of
total cash compensation derived from base salaries.
7
<PAGE>
The executive compensation policies developed by the Committee are based
upon a philosophy of "pay for performance" as the best means to promote
shareholders' interests. Each individual's performance is also linked to the
Company's financial performance and shareholder interests. The key components of
executive compensation are:
Base salary compensation payable in cash;
Incentive cash bonuses payable only in the event that the Company
achieves certain financial performance goals; and
Stock option and other stock incentive awards as an incentive to promote
the Company's long-term growth.
BASE SALARY
The base salaries of executive officers are established at levels
considered appropriate in light of the scope and authority of each officer's
position. Executive salaries are compared on an annual basis with other
individuals holding similar positions in comparably sized banking institutions.
A majority of the financial institutions of comparable size and performance that
constitute the base salary survey group used by the Committee in establishing
salary levels are included in the KBW 50 Index shown in the performance graph on
page 16. Other banking institutions with asset size similar to the Company's and
with comparable performance were added to those banking institutions in the KBW
50 Index to form the comparison group. The Committee believes this process
resulted in more accurate compensation comparisons.
Following the determination of a median base salary derived from the
comparison group as a benchmark, each individual executive officer's salary is
analyzed using several factors, including: the Company's attainment of financial
performance goals; the individual's contribution to that performance; the
individual's position within the Company and the duties and responsibilities
assigned to such individual; and the individual's experience. No specific
mathematical weighting is applied to these factors. The Committee does not
target a specific range in the comparison group in setting base salary, but
seeks to ensure that individual salaries are within the broad range of salaries
reflected in the comparison group. The Committee reviews salaries with the Chief
Executive Officer and may make judgmental and discretionary determinations as
part of its assessment process.
ANNUAL INCENTIVES
Executive officers are eligible for an annual incentive cash bonus, which
is generally a determined percentage of their base salary. The actual amount of
any cash bonus paid depends upon the degree to which pre-established performance
goals for the Company are achieved. For 1996, incentive awards were conditioned
upon the Company achieving a minimum of 1% return on assets (ROA) and earnings
per share (EPS) of at least $1.93. In calculating performance goals,
extraordinary items of income and expense were excluded.
The performance goals for 1996 were achieved after adjustment for an
extraordinary FDIC charge for certain deposit accounts. Incentive bonus payments
made for 1996 under this program were limited to no more than 25% of an
executive's base salary and averaged approximately 21% of executive officer base
salaries. Rewards to individual executive officers were based on the
recommendations of the Chief Executive Officer and the Committee's subjective
evaluation of each officer's individual contribution to the performance of the
Company.
8
<PAGE>
LONG-TERM INCENTIVE COMPENSATION
Long-term incentives are provided through stock option grants and
restricted stock grants under the Company's 1995 Stock Incentive Plan. These
programs are designed to provide incentives to executive officers and other
eligible employees to promote the long-term financial success of the Company.
STOCK OPTIONS
The Compensation Committee administers the granting of stock options to
executive officers and employees to encourage their ownership and retention of
the Company's Common Stock, and to enhance shareholder value, since Company
stock options have value only if the stock price increases over time. All
options are granted under a plan approved by the shareholders. Under the
existing plans, no stock option may be granted at an exercise price less than
100% of fair market value of the underlying stock on the date of grant, and all
options have a maximum life of 10 years.
In 1996, stock options were awarded under two programs. One program is
designed for all full time personnel and provides for the grant of options for
100 shares of Common Stock to employees on each of their successive five year
anniversary dates of employment with the Company. In 1996, awards of stock
options were made under this program to 494 employees.
Under the second program, options for 430,500 shares of Common Stock
(adjusted to 695,750 shares after giving effect to a 3-for-2 stock split in
June, 1996) were awarded in January, 1996 to 250 key employees, including the
sixteen executive officers of the Company. The options awarded to executive
officers were determined by the Committee in their discretion upon consideration
of competitive compensation data provided by an independent compensation
consultant, the responsibilities and experience of the executive officers and
the recommendations of the Chief Executive Officer.
RESTRICTED STOCK
The Committee considers awards of restricted stock as another form of
long-term incentive compensation. In order to more closely link restricted stock
grants to the Company's financial performance and shareholder return, restricted
stock is granted if the Company's goals for growth in earnings per share (EPS)
are achieved or surpassed. The restricted stock if granted, then vests over
three years, one-third of the original grant per year, assuming the continued
employment of the executive, subject to earlier vesting under certain
circumstances. Although the recipient receives dividends on and may vote
restricted stock, the stock certificate is not delivered and the stock may not
be sold, transferred or pledged until it vests. The 1996 EPS objective was
achieved, enabling a restricted stock award to executive officers on the basis
of their base salary.
CHIEF EXECUTIVE OFFICER COMPENSATION
The same policies and programs described above were followed by the
Committee to determine the Chief Executive Officer's base salary, bonus and
incentive compensation. Mr. Miller's base salary was not increased in 1996. His
bonus was dependent upon the Company achieving the pre-established performance
goals for return on assets (ROA) and earnings per share (EPS). In 1996, the
amount of cash bonus achievable by Mr. Miller ranged from 0 to a maximum of 25%
of his base salary. The Committee determined in its discretion, upon the
achievement of the performance goals, that Mr. Miller would receive the full
cash bonus for which he was eligible equal to 25% of his base salary.
9
<PAGE>
Based on the Company's EPS for 1996 and the predetermined formula, the
Committee also granted to Mr. Miller 4,420 shares of restricted stock.
Consistent with the Committee's policy as described above, the restricted stock
will vest in equal installments over three years.
In January 1996, the Committee in its discretion also granted Mr. Miller an
option to purchase 20,000 shares of Common Stock, which was adjusted to 30,000
shares after giving effect to a 3-for-2 stock split in June, 1996. Although this
grant was not measured upon the attainment of any specific goals, the Committee,
in making this grant, took into consideration growth in EPS and ROA,the increase
in the net interest margin and a continued favorable efficiency ratio.
TAX CONSIDERATIONS
Federal income tax law limits the deductibility of certain compensation
paid in excess of $1 million to the Chief Executive Officer and the four other
most highly paid executive officers of a publicly held company. An exception to
the limitation on deductibility is provided for "performance-based" compensation
if certain shareholder approval and outside director administration requirements
are met. The Committee does not currently anticipate that any executive
officer's compensation will exceed $1 million for 1997. However, the Committee
and the Board of Directors retain the discretion to grant non-deductible
compensation if the Committee and the Board determine that such a grant would be
in the best interests of the Company and the shareholders under the
circumstances.
The Company believes that awards of stock options and stock appreciation
rights under the 1995 Stock Incentive Plan will not otherwise limit the
deductibility by the Company of certain executive compensation for federal
income tax purposes under Section 162(m) of the Code. Under Internal Revenue
Service Regulations, grants of restricted stock under the 1995 Stock Incentive
Plan may only qualify as performance-based compensation if made contingent on
the attainment of appropriate pre-established and objective performance goals.
COMPENSATION COMMITTEE
James F. Betts
George R. Lewis
Kenneth S. White
10
<PAGE>
EXECUTIVE COMPENSATION
The following table summarizes all cash compensation paid or accrued by the
Company and its subsidiaries to the Chief Executive Officer and four other most
highly compensated executive officers of the Company during the past three
fiscal years for all services rendered.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM
---------------------------------- COMPENSATION
OTHER -------------------------- ALL
ANNUAL RESTRICTED SECURITIES OTHER
COMPENSA- STOCK UNDERLYING COMPENSA-
NAME AND SALARY BONUS TION(1) AWARD(S)(2) OPTIONS(3) TION(4)
PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($)
- --------------------------------- ----- -------- ------- --------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Lewis N. Miller, Jr.............. 1996 650,000 162,500 -- 114,368 30,000 117,053
Chairman, Chief Executive 1995 650,000 -- -- -- 0 22,092
Officer and President 1994 614,176 -- -- -- 30,000 21,153
Jay O. Livingston................ 1996 385,000 82,000 -- 68,621 15,000 63,212
Corporate Executive 1995 365,000 -- -- -- 0 12,527
Vice President and Chief 1994 348,233 -- -- -- 7,650 12,047
Administrative Officer
Philip G. Hug.................... 1996 385,000 82,000 -- 68,621 15,000 70,693
Corporate Executive 1995 365,000 -- -- -- 0 12,527
Vice President 1994 351,927 -- -- -- 7,500 12,177
John T. Percy, Jr................ 1996 320,000 65,000 -- 56,304 13,500 55,618
Corporate Executive 1995 305,000 -- -- -- 0 10,468
Vice President 1994 293,124 -- -- -- 7,500 10,095
Rodger W. Fauber................. 1996 319,000 48,000 -- 56,304 9,000 698,091
Former President, Western 1995 306,000 -- -- -- 0 10,502
Region of the Bank 1994 298,144 -- -- -- 7,500 10,307
</TABLE>
- ---------------
(1) All benefits which might be considered of a personal nature did not exceed
the lesser of $50,000 or 10% of total annual salary for the named executive
officer in the table.
(2) There were no restricted stock holdings at December 31, 1996. The restricted
stock awards, granted on January 8, 1997 based on 1996 performance, will
vest on a three year schedule as follows: Mr. Miller was granted 4,420
shares, with 1,473 shares vesting on each of January 8, 1998 and January 8,
1999 and 1,474 shares vesting on January 8, 2000; Mr. Livingston and Mr. Hug
each were granted 2,652 shares, with 884 shares vesting on each of January
8, 1998, January 8, 1999 and January 8, 2000; and Mr. Fauber and Mr. Percy
each were granted 2,176 shares, with 725 shares vesting on each of January
8, 1998 and January 8, 1999 and 726 shares vesting on January 8, 2000.
Dividends will be paid on all of the shares of restricted stock.
(3) The number of securities underlying options have been adjusted for a 3-for-2
stock split effective June 14, 1996. The Company granted no SARs.
(4) Includes for 1996 (a) Company contributions to the Stock and Thrift Plan and
a companion non-qualified plan (Mr. Miller, $19,500; Mr. Livingston,
$11,550; Mr. Hug, $11,500; Mr. Percy, $9,600; and Mr. Fauber, $9,570); (b)
$638,000 accrued for Mr. Fauber under an arrangement that continues his
current salary for a two year period following his leaving active employment
on December 31, 1996; (c) Company group insurance premiums for individual
employees (Mr. Miller, $2,208; Mr. Livingston, $830; Mr. Hug, $1,374; Mr.
Percy, $1,126; and Mr. Fauber, $1,757); and (d) split dollar insurance
premiums for individuals employees (Mr. Miller, $95,345; Mr. Livingston,
$50,832;
11
<PAGE>
Mr. Hug, $57,769; Mr. Percy, $44,892; and Mr. Fauber, $48,764). The Company
expects to recover substantially all of the premiums paid for split dollar
insurance upon the retirement or death of the named executive officers.
STOCK AND THRIFT PLAN
Under the Stock and Thrift Plan, a qualified plan, and a companion
non-qualified plan (collectively the "Thrift Plan"), employees of the Company
and its subsidiaries (the "Employer") who have completed six months of
employment may participate. Participants may contribute up to 16% of annual
compensation, and the Employer contributes an amount at least equal to 50% of
the participant's contribution, but not to exceed 3% of annual compensation. The
Thrift Plan provides that upon achieving certain defined return on equity
ratios, an amount up to an additional 50% of the participant's contribution may
be made by the Employer, but not to exceed an additional 3% of annual
compensation. For 1996, no additional contributions were made on behalf of any
participant.
RETIREMENT PLAN
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
--------------------------------------------------------
REMUNERATION 15 20 25 30 35
- ----------------------------------------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$125,000....................................... $ 58,820 68,010 77,200 86,390 95,580
200,000....................................... 95,570 110,760 125,950 141,140 156,330
300,000....................................... 144,570 167,760 190,950 214,140 237,330
400,000....................................... 193,570 224,760 255,950 287,140 318,330
500,000....................................... 242,570 281,760 320,950 360,140 399,330
600,000....................................... 291,570 338,760 385,950 433,140 480,330
700,000....................................... 340,570 395,760 450,950 506,140 561,330
800,000....................................... 389,570 452,760 515,950 579,140 642,330
900,000....................................... 438,570 509,760 580,950 652,140 723,330
</TABLE>
The Company has a non-contributory, tax qualified retirement plan and a
companion non-contributory, non-qualified plan (collectively, the "Retirement
Plan") for full-time and regular part-time employees of the Company and its
subsidiaries. Benefits are based on an employee's salary for the highest sixty
consecutive months and usually are distributable at age 65. The benefits are
computed on a straight-line annuity basis and are not reduced for Social
Security benefits or any other offset amounts. The Retirement Plan provides for
100% vesting after 5 years, for early retirement at age 55 after 10 years of
vested service and for the payment of benefits to the surviving spouse of an
employee. Depending on the deceased participant's years of service, payments to
a surviving spouse equal either 100% or 50% of the employee's benefits. Because
the Retirement Plan is a defined benefit plan under which benefits vary with
years of service, average annual salary during a specified period and age at
retirement, the costs under the Retirement Plan are not included in the
foregoing Summary Compensation Table. The Pension Plan Table shows the estimated
annual benefit payable upon retirement based on specified remuneration and years
of credited service classifications, assuming a participant retired on December
31, 1996. The Pension Plan Table and Summary Compensation Table may be used to
estimate pension benefits for each of the named executive officers based on
their credited years of service as of December 31, 1996: Mr. Miller, 24 years;
Mr. Hug, 23 years; Mr. Livingston, 22 years; Mr. Percy, 23 years; and Mr.
Fauber, 30 years.
Benefits payable under the Company's Executive Supplemental Retirement
Plan, described below, have been added to the pension amounts in the table. The
IRS limit on annual benefits payable from
12
<PAGE>
qualified defined benefit plans will be $125,000 for 1997. This amount is tied
to changes in the Consumer Price Index and may increase in the future. The Tax
Reform Act of 1986 imposes additional limits on the maximum benefits under
defined benefit plans.
ESRP
The Company maintains an Executive Supplemental Retirement Plan (the
"ESRP"), a non-qualified, unfunded defined benefit plan for executives
designated by the Benefits Committee appointed by the Board. Current executives
covered by the ESRP include the individuals named in the Summary Compensation
Table above as well as twelve other executives. The annual benefit equals 25% of
the executive's salary at age 62 even though the executive may retire at a later
age. If early retirement is elected, pursuant to the provisions of the Company's
Retirement Plan, the benefit is 25% of the executive's salary at that time.
Should the executive's employment terminate due to disability or death, the
benefit to the executive or such deceased executive's beneficiary is 25% of the
executive's salary at that time. The ESRP benefit is payable for twenty years
certain when payout begins. All participating executives accumulate unfunded,
unvested benefits while actively employed; however, benefits are forfeited if
the executive's employment is terminated for any reason other than retirement,
death, disability or a change in control of the Company.
EMPLOYMENT ARRANGEMENTS
The Company has employment agreements with certain executive officers,
including Messrs. Miller, Livingston, Hug and Percy that become effective upon a
change in control of the Company. The Company or its successor agrees to
continue these officers in its employ for a term of three years after the date
of a change in control. During the contract term these officers will retain
commensurate authority and responsibilities and compensation benefits. They will
receive base salaries at least equal to the highest monthly salary paid within
one year and bonuses at least equal to the highest annual bonus paid within
three years prior to the change in control. If the officer's employment during
the three-year term is terminated other than for cause or disability as defined
in the agreements or if the officer should terminate employment because a
material term of the contract is breached by the Company or its successor, the
officer will be entitled to a lump sum payment, in cash, within fifteen days
after the date of termination. This lump sum will be equal to the officer's base
salary, annual bonus and performance award rights, if any, for the balance of
the three year term.
The Company's agreement with Mr. Fauber, who retired from active employment
as the President of the Bank's Western Region on December 31, 1996, provides for
his acting as a consultant to the Bank until December 31, 1998 at his year-end
1996 salary.
If there is a change in the control of the Company, in order to ensure that
accrued benefits will be paid as required by the ESRP, the Company immediately
will make a lump sum contribution to a trustee, or under certain circumstances
to participants, in an amount sufficient to pay anticipated benefits under the
ESRP. The Company is the owner of insurance policies on the lives of the
participating executives under which it will recover certain benefit costs
incurred upon the death of a participant. Total cost to the Company for 1996 for
the ESRP was approximately $1,203,000.
Lump-sum payments under the employment agreements described above may
subject an officer to excise taxes under Section 280G of the Internal Revenue
Code. The agreements were amended in 1990 to hold an officer harmless from any
and all excise taxes levied on any payment caused by a change in control. Such
payments may be determined to be non-deductible by the Company for federal
income tax purposes under said section.
13
<PAGE>
STOCK OPTIONS
The Company has stock option plans which expire in various years to 2005.
These plans provide for the granting of options to eligible employees of the
Company and its subsidiaries to purchase shares of the Company's Common Stock.
The following table reflects grants of stock options made during the year
ended December 31, 1996 for each of the executive officers listed in the Summary
Compensation Table.
OPTION/SAR(1) GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
% OF TOTAL ANNUAL RATES OF
NUMBER OF OPTIONS STOCK PRICE
SECURITIES GRANTED EXERCISE APPRECIATION
UNDERLYING TO EMPLOYEES PRICE PER FOR OPTION TERM (4)
OPTIONS IN FISCAL SHARE (3) EXPIRATION ----------------------
NAME GRANTED (2) YEAR ($) DATE 5% ($) 10% ($)
- --------------------- ----------- ------------ ------------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Lewis N. Miller, Jr. 30,000 4.32% 21.21 1/9/06 400,200 1,014,000
Jay O. Livingston 15,000 2.16% 21.21 1/9/06 200,100 507,000
Philip G. Hug 15,000 2.16% 21.21 1/9/06 200,100 507,000
John T. Percy, Jr. 13,500 1.94% 21.21 1/9/06 180,090 456,300
Rodger W. Fauber 9,000 1.29% 21.21 1/9/06 120,060 304,200
</TABLE>
- ---------------
(1) The Company granted no SARs.
(2) The number of securities underlying options have been adjusted for a 3-for-2
stock split effective June 14, 1996. Options granted were exerciseable as
follows: Mr. Miller, 30,000 shares first exerciseable on July 10, 1996; Mr.
Livingston, 10,286 shares first exerciseable on July 10, 1996 and 4,714
shares first exerciseable on January 1, 1997; Mr. Hug, 5,572 shares first
exerciseable on July 10, 1996 and 4,714 shares first exerciseable on each of
January 1, 1997 and January 1, 1998; Mr. Percy, 4,714 shares first
exerciseable on each of July 10, 1996 and January 1, 1997 and 4,072 shares
first exerciseable on January 1, 1998; and Mr. Fauber, 4,714 shares first
exerciseable on July 10, 1996 and 4,286 shares first exerciseable on January
1, 1997.
(3) The exercise price for each option is equal to the fair market value
(average of the high and low prices) per share of the Common Stock on the
grant date as adjusted for the 3-for-2 stock split effective June 14, 1996.
(4) The amounts shown are the result of calculations at 5% and 10% assumed rates
of appreciation to the option expiration date as suggested by the Securities
and Exchange Commission rules. No assurance can be given that the actual
value, if any, realized by an executive upon the exercise of these options
will approximate the values shown. To put these hypothetical values into
perspective, the following is provided:
14
<PAGE>
<TABLE>
<CAPTION>
ANNUAL RATE OF STOCK PRICE
APPRECIATION
------------------------------
5% 10%
------------ --------------
<S> <C> <C>
Resulting stock price based on $21.21 grant price $ 34.55 $ 55.01
Gain per share 13.34 33.80
Aggregate gain that would be realized by all shareholders (based on
60,341,446 shares outstanding on the grant date January 10, 1996 804,954,890 2,039,540,875
Aggregate hypothetical gain on all 1996 options granted to the named
executive officers if the resulting prices are achieved 1,100,550 2,788,500
Aggregate hypothetical gain on all 1996 options granted to the named
executive officers as a percentage of all shareholders' gains 0.14% 0.14%
</TABLE>
The following table shows, for each of the executive officers listed in the
Summary Compensation Table, the number of shares acquired upon exercise of
existing options during 1996 and the value realized, plus the number and value
at December 31, 1996 of unexercised options.
AGGREGATED OPTION/SAR (1) EXERCISES IN
LAST FISCAL YEAR AND FY-END OPTION/SAR (1) VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF
UNEXERCISED UNEXERCISED
SHARES OPTIONS IN-THE-MONEY
ACQUIRED ON AT FISCAL OPTIONS AT FISCAL
EXERCISE VALUE YEAR END (#) YEAR END ($)
(2) REALIZED (3) EXERCISABLE/ EXERCISABLE/
NAME (#) ($) UNEXERCISABLE UNEXERCISABLE (4)
- --------------------- ----------- ------------ --------------------------- -----------------------------
<S> <C> <C> <C> <C>
Lewis N. Miller, Jr. 10,000 168,750 179,402/9,666 2,103,821/58,769
Jay O. Livingston 40,500 483,795 76,623/4,714 1,032,656/21,402
Philip G. Hug 27,205 411,540 20,722/9,428 125,059/42,803
John T. Percy, Jr. 20,250 248,265 53,614/8,786 721,441/39,888
Rodger W. Fauber 33,750 582,188 50,651/4,286 599,175/19,458
</TABLE>
- ---------------
(1) The Company has no SARs outstanding.
(2) The number of shares has, where appropriate, been adjusted for a 3-for-2
stock split effective June 14, 1996.
(3) Value realized was calculated using the closing price of Common Stock on the
date of exercise.
(4) The value is the excess of the closing price of Common Stock on December 31,
1996 ($25.75) over the option exercise price.
15
<PAGE>
PERFORMANCE GRAPH
The following performance graph compares the cumulative total shareholder
returns for the Company as compared with the S&P 500 Index and the KBW 50* Index
for the Company's last five years. The graph assumes that the value of the
investment in the Company's Common Stock and each index was $100 at December 31,
1991 and that all dividends were reinvested.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN**
AMONG CENTRAL FIDELITY BANKS, INC., THE S & P 500 INDEX AND THE KBW 50 INDEX
[GRAPH]
12/91 12/92 12/93 12/94 12/95 12/96
Central Fidelity Banks, Inc. 100 112 115 104 143 179
S&P 500 100 108 118 120 165 203
KBW 50 100 127 134 128 204 289
* THE KBW 50 IS AN INDEX COMPRISED OF 50 BANKING COMPANIES, INCLUDING ALL
THE MONEY CENTER BANKS AND MOST LARGE REGIONAL BANKS. IT HAS BEEN
DEVELOPED BY KEEFE, BRUYETTE & WOODS, A NEW YORK SECURITIES FIRM WHICH
SPECIALIZES EXCLUSIVELY IN THE BANKING AND THRIFT INDUSTRY. THE KBW 50
IS CONSIDERED MORE REPRESENTATIVE OF PRICE PERFORMANCE OF THE MAJOR
BANKING COMPANIES IN AMERICA.
** ASSUMES $100 INVESTED ON DECEMBER 31, 1991 IN STOCK OR INDEX AND THAT
DIVIDENDS WERE REINVESTED.
16
<PAGE>
CERTAIN TRANSACTIONS AND BUSINESS RELATIONSHIPS WITH MANAGEMENT
During the past year some nominees, directors and executive officers of the
Company, their affiliates and members of their immediate families were customers
of, and had borrowing transactions with, the Company's principal banking
subsidiary in the ordinary course of business. All outstanding loans and
commitments included in such transactions were made 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
the normal risk of collectibility or present other unfavorable features.
During 1996, the Company and its subsidiaries utilized the legal services
of Hunton & Williams, of which director T. Justin Moore, III is a partner. The
amount of fees paid to Hunton & Williams did not exceed 5% of the firm's gross
revenues during its last fiscal year. See further discussion under "Compensation
Committee Interlocks and Insider Participation."
SECTION 16 (A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under Section 16(a) of the Securities Exchange Act of 1934, directors and
executive officers of the Company are required to file reports with the
Securities and Exchange Commission and with the Company of their beneficial
ownership and changes in ownership of Common Stock.
Based solely on a review of the forms that were filed with it and
representations of the directors and executive officers, the Company believes
that all required forms were timely filed for the year 1996 and for prior years,
with the exception of the untimely filing of a Form 4 Report for John T. Percy,
Jr., an executive officer, disclosing the transfer by gift of shares to his
wife.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The accounting firm of KPMG Peat Marwick has been selected to audit the
consolidated financial statements of the Company for 1997. Representatives of
such accounting firm are expected to be present at the Annual Meeting of
Shareholders, will have the opportunity to make a statement if they desire to do
so and will be available to respond to appropriate questions.
INFORMATION RELATING TO SHAREHOLDER PROPOSALS
In the event shareholders of the Company intend to make any proposals to be
presented at the next annual meeting of shareholders of the Company to be held
in May, 1998 (or such date as shall be designated by the Board), such proposals
must be received at the Company's principal executive offices at 1021 E. Cary
Street, Post Office Box 27602, Richmond, Virginia, 23261-7602, Attn: William N.
Stoyko, Secretary, not less than 120 days prior to March 31, 1998 in order for
such proposals to be included in the Company's proxy statement and form of proxy
relating to such meeting.
OTHER MATTERS
Management has no knowledge of any other matters which may come before the
Meeting and does not itself intend to present any such other matters. However,
if any such matters shall properly come before the Meeting or any adjournment
thereof, the persons named as proxies will have discretionary authority to vote
those shares represented by the accompanying proxy in accordance with their own
best judgment.
By Order of the Board of Directors,
WILLIAM N. STOYKO
SECRETARY
March 31, 1997
17
<PAGE>
CENTRAL FIDELITY BANKS, INC.
1021 E. CARY STREET, RICHMOND, VIRGINIA 23219
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, revoking any proxy heretofore given, hereby appoints Lewis
N. Miller, Jr., Jay O. Livingston and William H. Schwarzschild, III, or any of
them (with full power to act in the absence of the others, the act of a majority
of those present to be controlling, each with full power of substitution) as
Proxies to vote all the shares of Common Stock of Central Fidelity Banks, Inc.
held of record by the undersigned on March 14, 1997 at the Annual Meeting of
Shareholders of said Company to be held in the banking hall of Central Fidelity
National Bank, Broad at Third Street, Richmond, Virginia, at 4:30 p.m. on May
14, 1997, and at any and all adjournments thereof as follows:
<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS [ ] FOR all nominees listed [ ] WITHHOLD AUTHORITY to vote
(except as indicated to for all nominees listed below
the contrary below)
</TABLE>
THREE YEAR TERM AS CLASS 3 DIRECTOR: JAMES F. BETTS, PHYLLIS L. COTHRAN,
G. BRUCE MILLER, KENNETH S. WHITE
(Instruction: to withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- --------------------------------------------------------------------------------
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
<PAGE>
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 for the election of all directors listed under Proposal 1.
Please sign below exactly as name appears hereon. When shares are held by
joint tenants, both should sign. When signing as attorney-in-fact, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name by authorized
person.
_____________________________________________________________________________
Signature
_____________________________________________________________________________
Signature if held jointly
Dated__________________________________________________________________, 1996
I plan to attend the Annual Meeting YES [ ] NO [ ]
Number in Party ______
The number of shares shown above and covered by this proxy include, where
applicable, shares held in the Stock Purchase Program (formerly the Dividend
Reinvestment Plan).
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
