SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Schedule 14(a)
of the Securities Exchange Act of 1934
File by the Registrant x
Filed by a Party other than Registrant o
Check the Appropriate Box:
o Preliminary Proxy Statement
o Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e)(2))
X Definitive Proxy Statement
o Definitive Additional Materials
o Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
THE SEIBELS BRUCE GROUP, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
x No fee required.
o 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:
o Fee paid previously with preliminary materials.
o 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:
THE SEIBELS BRUCE GROUP, INC.
COLUMBIA, SOUTH CAROLINA
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 12, 1996
TO THE SHAREHOLDERS OF THE SEIBELS BRUCE GROUP, INC.:
Notice is hereby given that the Annual Meeting of Shareholders (the
"Meeting") of The Seibels Bruce Group, Inc. ("SBIGE" or the "Company"), will be
held at the offices of the Company at 1501 Lady Street, Columbia, South Carolina
29201, at 11:00 a.m., on Thursday, December 12, 1996 for the following purposes:
1) To elect one (1) Director to hold office until the 1997 Annual
Meeting of Shareholders and until his successor shall be elected and
shall qualify, two (2) Directors each to hold office until the 1998
Annual Meeting of Shareholders and until his successor shall be
elected and shall qualify and three (3) Directors each to hold office
until the 1999 Annual Meeting of Shareholders and until his
successor shall be elected and shall qualify (Proposal 1);
2) To consider a proposal to ratify the selection of Arthur Andersen
LLP to audit the Company's books and records for the fiscal year
ending December 31, 1996 (Proposal 2);
3) To consider a proposal to ratify and approve the issuance of 35,000
shares to Non-Employee Directors as part of compensation for
services rendered pursuant to Rule 4460 (formerly Schedule D to the
Bylaws) of the National Association of Securities Dealers,
Inc.(Proposal 3); and
4) To consider and transact such other business as may properly and
lawfully come before the Meeting or any adjournment thereof.
All of the foregoing is more fully set forth in the Proxy Statement accompanying
this Notice.
The transfer books of the Company will close as of the end of business on
October 10, 1996 (the "Record Date") for purposes of determining shareholders
who are entitled to notice of and to vote at the Meeting, but will not be closed
for any other purpose.
All shareholders are cordially invited to attend the Meeting in person. If you
cannot attend the Meeting, please take the time to promptly sign, date and mail
the enclosed proxy in the envelope we have provided. If you attend the Meeting
and decide that you want to vote in person, you may revoke your proxy. The
Board of Directors recommends that you vote in favor of the nominees for direc-
tors and the described proposals to be considered at the meeting.
By Order of the Board of Directors
Priscilla C. Brooks
Corporate Secretary
October 28, 1996
THE ACCOMPANYING PROXY FORM IS SOLICITED BY THE BOARD OF
DIRECTORS AND IS REVOCABLE AT ANY TIME PRIOR TO BEING EXERCISED.
THE PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS
THEREON. IF A CHOICE IS NOT INDICATED, HOWEVER, THE PROXY WILL BE
VOTED IN FAVOR OF THE NOMINEES FOR DIRECTORS, IN FAVOR OF THE
DESCRIBED PROPOSALS TO BE CONSIDERED AT THE MEETING, AND IN THE
BEST JUDGMENT OF THE PROXIES CONCERNING ALL OTHER PROPOSALS
CONSIDERED AT THE MEETING.
THE SEIBELS BRUCE GROUP, INC.
1501 Lady Street
Columbia, South Carolina 29201
PROXY STATEMENT FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 12, 1996
General
This Proxy Statement is furnished to the holders of Common Stock, par value
$ 1.00 per share (the "Common Stock") of The Seibels Bruce Group, Inc. ("SBIGE"
or the "Company"), in connection with the solicitation of proxies by the Board
of Directors of the Company to be voted at the Annual Meeting of Shareholders
(the "Meeting") to be held at the time and place and for the purposes specified
in the accompanying Notice of Annual Meeting of Shareholders and at any
adjournments thereof. It is anticipated that this Proxy Statement will be
mailed to shareholders commencing on or about October 28, 1996.
When the enclosed proxy is properly executed and returned, the shares which
it represents will be voted at the Meeting in accordance with the instructions
thereon.
In the absence of any such instructions, the shares represented thereby will be
voted in favor of the nominees for Directors and the described proposals to be
considered at the Meeting and in the best judgment of the proxies concerning
all other proposals considered at the meeting. Abstentions and "broker non-
votes" are each included in the determination of the number of shares present
and voting, but are not counted as votes for or against proposals presented to
shareholders. (A "broker non-vote" occurs when a nominee holding shares for a
beneficial owner votes on one proposal, but does not vote on another proposal
because the nominee does not have discretionary voting power and has not
received instructions from the beneficial owner.) Any shareholder who executes
and delivers a proxy may revoke it prior to its use by (i) giving written notice
of such revocation to the Corporate Secretary of SBIGE at PO Box 1, Columbia,
South Carolina 29202, the Company's mailing address; or (ii)
executing and delivering to the Corporate Secretary of SBIGE (by mail at PO
Box 1, Columbia, South Carolina 29202, or by delivery at 1501 Lady Street,
Columbia, South Carolina 29201) a proxy bearing a later date; or (iii) appearing
at the Meeting and voting in person.
Annual Report
The Company's 1995 Annual Report, including Financial Statements, is
enclosed with this Proxy Statement to shareholders who have acquired the common
stock of the Company since April 11, 1996 (the record date for the Special
Shareholders Meeting which was held on June 14, 1996) up to the Record Date.
Shareholders who received a copy in connection with the Special Shareholders
Meeting but wish to receive another may obtain a copy and a copy of the Annual
Report on Form 10-K of the Company for the fiscal year ending December 31, 1995,
without charge upon written request addressed to Priscilla Brooks, Corporate
Secretary, The Seibels Bruce Group, Inc., PO Box 1, Columbia, South Carolina 29
202. If the person requesting a copy is not a shareholder of record, the
request must include a representation that he or she is a beneficial owner of
the Company's Common Stock.
Expenses of Solicitation
The cost of soliciting proxies will be borne by the Company. Officers,
directors, employees, and agents of the Company may solicit proxies by telephone
telegram or personal interview, without additional compensation.
Voting
Only holders of record of issued and outstanding shares of Common Stock, as
of October 10, 1996 (the "Record Date") will be entitled to notice of and to
vote at the Meeting. On the Record Date, there were 24,647,686 shares of Common
Stock outstanding. Each share of Common Stock is entitled to one vote, except
with respect to Proposal 1, as described below.
In connection with Proposal 1, the election of Directors, each shareholder is
allowed to cumulate his or her votes and cast as many votes as the number of
shares he or she holds multiplied by the number of Directors to be elected,
the same to be cast for any one candidate or distributed among any two or more
candidates. For shares to be voted cumulatively, a shareholder who has the
right to cumulate his or her votes shall either (1) give written notice of his
or her intention to the president or another officer of the Company not less
than 48 hours before the time fixed for the Meeting,
which notice must be announced in the Meeting before the voting, or (2) announce
his or her intention in the Meeting before the voting for Directors commences;
and all shareholders entitled to vote at the Meeting shall without further
notice be entitled to cumulate their votes. Directors will be elected by a
plurality of the votes cast.
For Proposal 2 and 3 to be approved, the affirmative vote of a majority of the
votes cast in person or by proxy at the Meeting is required.
Participants in the Company's Dividend Reinvestment and Shareholder
Purchase Plan (the "DRSP Plan") who have shares of Common Stock registered in
their names and who vote those shares on any matter submitted to the Meeting
will have all shares credited to their accounts under the DRSP Plan
automatically added to that number and voted in the same manner. If such
participants do not vote shares registered in their own names, the shares
credited to their account in the DRSP Plan will not be voted. An executed proxy
will be deemed to include any DRSP shares and will be voted with respect to
those shares credited to the participant's account. If a participant desires to
vote DRSP Plan shares in person at the Meeting, a proxy for the shares
credited to his or her account will be furnished upon written request received
by the Company, at the address set forth on the cover of this Proxy Statement,
at least fifteen (15) days prior to the date of the Meeting.
ELECTION OF DIRECTORS (PROPOSAL 1)
One of the purposes of the Meeting is to elect a total of six (6) directors; one
(1) Director to serve until the 1997 Annual Meeting of Shareholders, two (2)
Directors to serve until the 1998 Annual Meeting of Shareholders and three (3)
Directors to serve until the 1999 Annual Meeting of Shareholders.
Under Article 3, Section 2 of the Company's Bylaws, the Board of Directors
is divided into three classes which shall be as nearly equal in number as
possible, with the members of each class serving for three year terms or until
their successors are elected or qualified.
The shares represented by the proxies solicited hereby will be voted in favor
of the election of the persons named below unless authorization to do so is
withheld in the proxy. In the event any of the nominees should be unavailable
to serve as a Director, which contingency is not presently anticipated, it is
the intention of the persons named in the proxies to select and cast their votes
for the election of such other person or persons as the Board of Directors may
designate.
Pursuant to the Stock Purchase Agreement dated as of December 22, 1993
(the "Alissa Purchase Agreement") between the Company and Abdullatif Ali Alissa
Est. and Saad A. Alissa (the "Alissa Group"), the Alissa Group is entitled to
designate up to four (4) persons, who are reasonably acceptable to the Company,
to be included in the slate of nominees recommended by the Board of Directors to
the shareholders for election as directors. The Alissa Group previously
designated Mr. William M. Barilka and Dr. Albert H. Cox, Jr., both of whom were
elected at previous meetings of shareholders, and continue to hold office. In
December 1995, the Alissa Group designated, and the remaining Directors
appointed, Mr. Kenneth W. Pavia to fill a vacancy on the Board to serve until
the 1996 Annual Meeting. The Board of Directors, by a majority vote, is
recommending that Mr. Pavia be re-elected to the Board to serve a two (2) year
term to expire in 1998. In addition, the Alissa Group designated for
nomination for election to the Board, Fred S. Clark, who by majority of the
Board, is being recommended to the shareholders to be elected to a one (1) year
term expiring in 1997.
Pursuant to the Stock Purchase Agreement dated as of January 29, 1996 (the
"Powers Purchase Agreement") between the Company and Charles H. Powers, Walker
S. Powers and Rex W. and Jane P. Huggins (the "Powers Group"), the Powers Group
is entitled to designate two (2) persons, who are reasonably acceptable to the
Company, to be included in the slate of nominees recommended by the Board of
Directors to the shareholders for election as directors. The Powers Group is
waiving their right to the two designees for this Annual Meeting.
Pursuant to the Stock Purchase Agreement dated March 28, 1996 between the
Company and Fred C. Avent, Frank H. Avent, and Pepsico Bottling Company of
Florence (the "Avent Group"), the Avent Group is entitled to designate one (1)
person, who is reasonably acceptable to the Company, to be included in the slate
of nominees recommended by the Board of Directors to the shareholders for
election as directors. The Avent Group is waiving their right to the one (1)
designee for this Annual Meeting.
At the Special Shareholders' Meeting held June 14, 1996, the shareholders
approved fixing the number of directors of the Corporation at eighteen (18).
This was done in an effort to accommodate the additional seats which would be
generated by the Powers Group and Avent Group pursuant to the Stock Purchase
Agreements between the Company and the Powers Group and Avent Group. However,
with the decision of the Powers Group and Avent Group at this time not to
designate nominees for the upcoming annual meeting of shareholders for election
to the Board, it is the consensus of the Board of Directors that the current
number of ten (10) seats be maintained and that the additional eight seats not
be filled at this time. Pursuant to the Company's Articles and Bylaws,
these and other vacancies on the Board may be filled in the future
at the discretion of the Board.
All nominees for election to the Board of Directors are considered and
recommended by a Nominating Committee of the Board of Directors. (See
"Committees of the Board of Directors.") The full Board of Directors considers
the recommendations of that Committee and recommends the nominees to the
shareholders. The Company has no procedure whereby nominations are solicited or
accepted from shareholders, but the Nominating Committee will consider nominees
whose names and business experience are submitted in writing by shareholders to
the Corporate Secretary of the Company.
Terry E. Fields, former Chief Financial Officer and Robert D. Brooks, former
President, resigned from their positions with the Company, including their
membership on the Board of Directors, in March and April, 1995, respectively.
Robert H. Branche resigned from his position on the Board in March, 1995. In
June, 1995, Ernst Csiszar was appointed as President and a Director of the
Company. In September, 1995, Michael Ameen resigned as a Director. In October,
1995, John Weitzel was appointed Chief Financial Office and a Director of the
Company. At the same time, William Danzell was appointed as a Director (October
1995). In December, 1995, Roy Faulks resigned as a Director of the Company, and
Kenneth W. Pavia was appointed as a Director. All appointments of Directors to
fill vacancies created by resignation in 1995 were made by the remaining members
of the Company's Board of Directors. The Board of Directors recommends a vote
FOR each of the nominees.
The following information is set forth with respect to the six (6) nominees for
election to be Directors as well as the other members of the Board of Directors.
Name, Age and Principal Employment for Director Since
Past five Years
Nominees for Election to Hold Office until the 1997 Annual Meeting of
Shareholders:
Fred S. Clark, Esquire, 60, Attorney at Law, Currently Not Currently
Partner in the Law Firm of Clark and Clark, Savannah, A Director
Georgia. He has been a partner in the Firm for the past
five (5) years.
Directors Continuing in Office until the 1997 Annual Meeting of Shareholders:
George R.P. Walker, Jr., 64, is currently a Director of 1969
the Company and certain Company subsidiaries and has
been the owner and operator of Middlefield Farm
(Hanoverian horse farm), Blythewood, South Carolina,
for more than the past five years.
John C. West, 74, is currently Chairman of the Board 1994
of Directors of the Company. He was the Governor of
the State of South Carolina from 1971 to 1975, and
currently serves as Professor at the University of South
Carolina and as a practicing attorney. Mr. West also serves
as a member of the Board of Directors for Donaldson,
Lufkin & Jenrette, Inc.
Nominees for Election to Hold Office until the 1998 Annual Meeting of
Shareholders:
Claude E. McCain, 72, is currently a Director of the 1995
Company. He is also Chairman of H.C. McCain
Agency, Inc., President of McCain Realty, Inc. and
President of Insurance Finance Company, Inc. He was
formerly a member of the South Carolina State Insurance
Commission for 15 years, 10 of which he served as
Chairman. Mr. McCain has been in the insurance
business since 1946.
Kenneth W. Pavia, 54, is currently a Director of the 1995
Company. He is General Partner of Balboa Investments,
a position he has held since 1992. He also holds the
office of Chairman of FHI, Inc., a securities holding
company and Fiduciary Leasco, Inc., a position held since.
Directors Continuing in Office until the 1998 Annual Meeting of Shareholders:
William M. Barilka, 48, is currently a Director of the 1994
Company. He has served since 1991 as Chief Financial
Officer of AGGAD Investment Company, Riyadh,
Saudi Arabia. From 1986 to 1991, Mr. Barilka was
employed by the National Commercial Bank, Riyadh,
Saudi Arabia, in a variety of corporate finance positions.
Albert H. Cox, Jr., 64, is currently a Director of the 1994
Company. He is a Consulting Economist, formerly
serving as Chief Economist of Feltman & Co., an
Atlanta based investment banking firm from 1995 through
1996. From 1985 to 1993, he held various executive
positions, including Board Member and Senior
Economic Advisor, with BIL Management, Inc.,
a subsidiary of the Bank in Liechtenstein. Prior to
1985, he held a number of positions with Merrill Lynch & Co.
Name, Age and Principal Employment for Past five Years Director Since
Nominees for Election to Hold Office until the 1999 Annual Meeting of
Shareholders:
John P. Seibels, 54, is currently a Director of the 1969(1)
Company, Policy Management Systems, Corp.
("PMSC") and certain subsidiaries of the Company.
Mr. Seibels has been an investor based in Columbia,
South Carolina since March 1963.
Ernst N. Csiszar, 46, is currently a Director and 1995
(since June, 1995) has held the office of President
and (since January, 1996) Chief Executive Officer
of the Company and all of its subsidiaries. He also
continues to serve as a visiting professor at the School
of Business, University of South Carolina, a position
he has held since 1988.
John A. Weitzel, 50, is currently a Director and 1995
(since September, 1995) has held the office of
Chief Financial Officer of the Company and all
of its subsidiaries. From April, 1985 to November,
1994, he served as Chief Financial Officer of Milwaukee
Insurance Group, Inc. From March through August, 1995,
Mr. Weitzel acted as a consultant to the Company.
(1)Each present director of the Company with election dates prior to October
1978 (when the Company became the parent of the South Carolina Insurance Company
("SCIC"), the Company's principal subsidiary) was formerly a Director of SCIC
and the information set forth as to periods prior to 1978 reflects positions
with SCIC and the year such Director was first elected to the SCIC Board of
Directors.
Security Ownership of the Company
The following table sets forth, as of September 30, 1996, information regarding
the beneficial ownership of the Company's Common Stock by the directors of the
Company, and nominees for election, each executive officer named in the Summary
Compensation Table that appears under "Executive Compensation -- Summary
Compensation Table," all directors and executive officers as a group and each
person known to the Company to own 5% or more of its Common Stock.
Name of Beneficial Owner (and address,
with respect to non-directors or Number of Shares of Percent of Shares
officers) Common Stock of Common Stock
- - ------------------------------------- -------------------- -----------------
William M. Barilka 145,000(2,3) (4)
Fred S. Clark 15,608(5) (4)
Albert H. Cox, Jr. 16,000(3) (4)
Ernst N. Csiszar 300,000(6) (4)
William B. Danzell 5,000(7) (4)
Claude E. McCain 15,064(3) (4)
Kenneth W. Pavia 5,000(7) (4)
John P. Seibels 606,908(3,8,9) 2.42
George R.P. Walker, Jr. 406,858(3,9,10) 2.02
John A. Weitzel 100,000(11) (4)
John C. West 322,100(12) (4)
All Directors, Nominees for Director
and Executive Officers as a Group 1,947,538 5.30
Alissa Group 7,398,500(13) 30.00
PO Box 192
Alkhobar, Saudi Arabia
Avent Group 3,270,000(14) 6.63
PO Box 3886
Florence, South Carolina 29502
Powers Group 12,864,206(15) 26.83
PO Box 6525
Florence, South Carolina 29502
(1)Includes shares underlying options authorized for issuance by the Board of
Directors.
(2)Includes 100,000 shares jointly owned by Mr. Barilka with his wife and 10,000
shares of Common Stock underlying certain options.
(3)Includes 10,000 shares of Common Stock underlying certain options.
(4)Less than 1% of issued and outstanding shares of Common Stock of the Company.
(5)Includes 6,100 shares held by Mr. Clark's wife, and 3,840 shares held by his
minor son.
(6)Includes 300,000 shares of Common Stock underlying certain options.
(7)Includes 5,000 shares of Common Stock underlying certain options.
(8)Excludes 9,012 shares of Common Stock held by Mr. Seibels' wife, of which
shares he holds neither sole nor shared voting or dispositive power and, there-
fore, disclaims beneficial ownership.
(9)George R.P. Walker, Jr. and John P. Seibels are cousins.
(10)Excludes 45,557 shares of Common Stock held by Mr. Walker's wife, of which
shares he holds neither sole nor shared voting or dispositive power and, there-
fore, disclaims beneficial ownership.
(11)Includes 100,000 shares of Common Stock underlying certain options.
(12)Includes 280,000 shares of Common Stock underlying certain options.
(13)Based on information contained in Statement on Form 4 for September, 1996:
includes 152,800 shares for which Mr. Alissa has sole voting power, and
7,240,700 shares as to which he has share voting power beneficially
owned (shared voting and dispositive power) by Abdullatif Ali Alissa Est. (the
"Establishment"), Financial Investors Limited ("FIL") and General Investors
Limited ("GIL"). Mr. Alissa has informed the Company that he is the President
of the Establishment; that FIL is wholly owned by the Establishment; and that
GIL is wholly owned by Mr. Alissa. Excludes 185,858 warrants to purchase Common
Stock.
(14)Includes 1,635,000 shares of Common Stock underlying certain options.
(15)Includes 6,250,000 shares of Common Stock underlying certain options.
Section 16(a) Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers, directors and persons who own more than ten percent of the Company's
equity securities to file reports of ownership and changes in ownership with
the Securities and Exchange Commission and to furnish the Company with all such
forms they file. Based on the Company's review of the forms it has received and
on written representations from certain reporting persons that no such forms
were required for them, the Company believes that for the fiscal year ended
December 31, 1995, the Section 16(a) filing requirements applicable to its
officers, directors and greater than ten percent beneficial owners were in
compliance.
Committees of the Board of Directors
The Company has five standing committees: Executive, Audit, Compensation,
Investment and Nominating.
The Executive Committee is currently composed of John C. West (Chairman),
Ernst N. Csiszar, Claude E. McCain, John P. Seibels, and George R.P. Walker, Jr.
The Executive Committee exercises the same powers as the Board of Directors,
except as otherwise limited by specific prohibitions in South Carolina statutes.
The Committee's function is to act in the place of the Board on any matters
which require Board action and occur between meetings of the Board. The
Executive Committee of the Company met twenty times during 1995.
The Audit Committee is currently composed of Kenneth W. Pavia (Chairman),
Albert H. Cox, Jr. and Claude E. McCain, none of whom is an officer or employee
of the Company. The Committee's functions include recommending independent
public accountants to be employed by the Company, reviewing with the independent
public accountants their reports and audits, and reporting to the full Board of
Directors on their findings. The Audit Committee of the Company met two times
during 1995.
The Compensation Committee is currently composed of John P. Seibels
(Chairman), Albert H. Cox, Jr., Claude E. McCain and George R.P. Walker, Jr.,
none of whom is an officer or employee of the Company. The Committee's
functions are to recommend to the full Board the remuneration arrangements for
senior executive officers and for members of the Board of Directors, the
adoption of compensation plans in which Officers and Directors are eligible to
participate and the granting of stock options or other benefits under such plan.
The Compensation Committee met five times in 1995.
The Investment Committee is currently composed of Claude E. McCain
(Acting Chairman), William M. Barilka and Ernst N. Csiszar. The Committee's
functions are to advise the Board of Directors and officers of the Company with
respect to investment of the Company's assets and to periodically review,
evaluate and report on the performance of the investments of the Company and its
subsidiaries. The Investment Committee met twice in 1995.
The Nominating Committee is currently composed of George R.P. Walker, Jr.
(Chairman), Albert H. Cox, Jr. and John C. West. The Committee's functions
include selecting and recommending nominees for election as new, additional, and
replacement Directors and reviewing the performance of incumbent Directors for
nomination for reelection. The Nominating Committee met once in 1995.
Roy L. Faulks served as Chairman of the Investment Committee and was a
member of the Audit Committee prior to his resignation from the Board in
December 1995. Michael M. Ameen, Jr. served on the Compensation Committee and
the Audit Committee prior to his resignation from the Board in September, 1995.
The Board of Directors met nine times in 1995. In 1995, each of the
incumbent Directors attended at least 75% of the meetings of the Board and of
the Committee(s) of which he was a member held during the period for which he
served.
Compensation of Directors
In 1995, the Company paid quarterly to each Director who was not a full-time
employee of the Company a retainer fee of $175 per month plus $656.25 for each
meeting of the Board at which the Director was present, a fee of $175 for each
meeting of a Board Committee which he attended on the same day and in the same
general location as a Board meeting or by telephone, and a fee of $262.50 for
attending a Committee meeting otherwise. Each non-employee Director will
receive, upon shareholder approval, 5,000 restricted shares of Common Stock
as part of their compensation for the year 1995. (See Proposal 3). The
Chairman of the Board of Directors, John C. West, does not receive any
additional director compensation in connection with his position of Chairman of
the Board of Directors.
Compensation of Executive Officers
The following table sets forth, for the years ended December 31, 1995, 1994
and 1993, the cash compensation paid by the Company and its subsidiaries, as
well as certain other compensation paid or accrued for those years, to each of
the executive officers of the Company and such subsidiaries whose compensation
was in excess of $100,000 (the "Executive Group"), in all capacities in which
they serve.
Summary Compensation Table
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Restricted Securities
Other Annual Stock Underlying All Other
Salary Bonus Compensation Awards Options Compensation
Name and Principal Position Year ($) ($) ($) ($) (#) ($)
- - ----------------------------------------------------------------------------------------------------------------
John C. West 1995 141,785 0 15,625 0 280,000 0
Chairman of the Board 1994 0 0 0 0 0 0
Ernst N. Csiszar
President and Chief Executive 1995(1) 119,154 0 0 0 300,000 0
Officer
John A. Weitzel
Chief Financial Officer 1995(1) 33,231 0 0 0 100,000 174
Former Officers
Sterling E. Beale 1995 0 0 0 0 0 347,968(4)
Chairman of the Board and 1994 147,813 2,438 0 0 0 359,206(4)
Chief Executive Officer 1993 182,483 0 0 0 0 2,765
W. Thomas Reichard 1995 0 0 0 0 0 0
President 1994 102,476 1,813 0 0 0 252,279(5)
1993 135,659 0 0 0 0 2,199
</TABLE>
(1)Gov. West was appointed an officer of the Company for the first time in 1994
Messrs. Csiszar and Weitzel were appointed officers of the Company for the first
time in 1995.
(2)The amount shown represents the dollar value of the difference between the
price paid by Gov. West for shares upon the exercise of stock options and the
fair market value at the date of exercise.
(3)Mr. Weitzel was employed by the Company effective September 30, 1995. The
salary amount stated is for the three-month period from the date of employment
through December 31, 1995. Prior to the date of employment, Mr. Weitzel was a
consultant to the Company during 1995. With respect to his consulting services,
the Company paid Mr. Weitzel consulting fees in the amount of $114,000 during
1995.
(4)The amounts shown for 1995 and 1994 for Mr. Beale include payments of
$193,748 and $355,500, respectively, pursuant to a certain Retirement Agreement
and $150,938 of salary for 1994 which was actually paid in 1995.
(5)The amount shown for 1994 for Mr. Reichard includes payments aggregating
$249,502 pursuant to a certain Separation Agreement and Mutual Release.
Option Grants
During the year ended December 31, 1995, the Company granted 300,000
stock options to each of the executive officers of the Company whose
compensation was in excess of $100,000 (the "Executive Group") pursuant to the
Company's 1987 Stock Option Plan. In addition, the Board of Directors approved
the grant of 400,000 stock options to members of the Executive Group pursuant to
the Company's 1996 Stock Option Plan for Employees, subject to shareholder
approval of that plan. That plan was approved at a special shareholders'
meeting on June 14, 1996. The following table sets forth the grants during the
year ended December 31, 1995.
Option Grants During the Year Ended December 31, 1995
<TABLE>
<S> <C> <C> <C> <C> <C>
Number of Percent of
Securities Total Potential Realizable value at
Underlying Options Exercise assumed rates of stock price
Options Granted to Price Expiration appreciation for option terms ($)
Name Granted(#) Employee ($/Share) Date 0%(6) 5%(7) 10%(7)
- - ------------ ----------- ------------ -------- ----------- -----------------------------
John C. West 100,000(8) 13% 1.625 12/21/00 0 44,895 99,208
Chairman 100,000(8) 13% 2.500 12/21/00 0 (42,605) 11,708
100,000 13% .875 06/13/00 0 24,175 53,420
Ernst C.Csiszar 100,000(8) 13% 1.625 12/21/00 0 44,895 99,208
Chief Executive 100,000(8) 13% 2.500 12/21/00 0 (42,605) 11,708
Officer 100,000 13% .875 06/13/00 0 24,175 53,420
John A. Weitzel
Chief Financial 100,000 13% .8125 09/30/00 0 22,428 49,604
Officer
</TABLE>
(6)These grants were made with an exercise price per share at or above the
closing market price per share on the date of the grant.
(7)Assumed for illustrative purposes only.
(8)These grants were authorized by the Board of Directors during 1995 under the
1996 Plan, subject to shareholder approval of the 1996 Plan.
Option Exercises and Year-End Holdings
During the year ended December 31, 1995, members of the Executive Group
exercised a total of 20,000 stock options. The following table sets forth
certain information with respect to option exercises during the year ended
December 31, 1995, and unexercised stock options held by the Executive Group as
of December 31, 1995.
Aggregated Option Exercises During the Year
Ended December 31, 1995 and 1995 Year-End Option Values
<TABLE>
<S> <C> <C> <C> <C>
Shares
Acquired Number of Securities
On Value Underlying Unexercised Value of Unexercised In-The-
Exercise Realized Options at Year-End Money Options at Year-End
Name (#) ($) (#) Exercisable/Unexercisable ($) Exercisable/Unexercisable
- - ---------------- --------- --------- ----------------------------- -----------------------------
John C. West 20,000 15,625(1) 180,000/100,000(2) 50,000
Chairman of the
Board
Ernst N. Csiszar 0 N/A 200,000/100,000(3) 62,500
Chief Executive
Officer
John A. Weitzel 0 N/A 100,000/0 68,750
Chief Financial
Officer
</TABLE>
(1)The amount shown represents the dollar value of the difference between the
purchase price paid by Gov. West for the shares upon exercise of the stock
options and the fair market value of the shares at the date of purchase.
(2)The amounts shown for Gov. West include 200,000 option grants authorized by
the Board of Directors during 1995 under the 1996 Plan, subject to shareholder
approval of the 1996 Plan which was received at the Special Shareholders Meeting
of June 14, 1996.
(3)The amounts shown for Mr. Csiszar include 200,000 option grants authorized by
the Board of Directors during 1995 under the 1996 Plan, subject to shareholder
approval of the 1996 Plan which was received at the Special Shareholders Meeting
of June 14, 1996.
Employment Agreements
The Company has entered into employment agreements (each, an "Agreement")
under which Ernst N. Csiszar will serve as President and Chief Executive Officer
John C. West will serve as Chairman and John A. Weitzel will serve as Group Vice
President and Chief Financial Officer (each an "Employee"), of the Company for
a term of one (1) year. The terms of each Agreement are substantially ident-
ical (except as detailed below). The following is a summary of the terms of the
Agreements.
Effective Dates of Employment. The one-year terms of Mr. Csiszar and Gov. West
began on January 1, 1996. Mr. Weitzel's one-year term began on September 30,
1995. Mr. Weitzel's Agreement has been extended for three months to coincide
with Mr. Csiszar's and Gov. West's Agreement.
Salary. As payment for services rendered by the Employee under the Agreement,
the Company pays Messrs. Csiszar and Weitzel $12,000, and Gov. West $7,200, per
month during the term of the Agreement. The Employee does not receive
additional compensation for service on the Board of Directors of the Company or
any committee thereof.
Bonus. Mr. Csiszar and Gov. West receive a bonus based on the operating
earnings of the Company for the calendar year 1996 of up to 150% of base salary.
Stock Options. Mr. Csiszar and Gov. West received, effective December 21, 1995,
options to purchase 200,000 shares of the Company's stock. The option for
100,000 shares vested on December 21, 1995, and shall be valid for a period of
five (5) years from the date of issue and shall expire on December 20, 2000.
The exercise price for these 100,000 shares is the closing price of the
Company's stock on December 21, 1995 ($1.625). The options for the remaining
100,000 shares shall vest on the earlier of (1) Employee's termination of
employment with the Company, or (2) December 31, 1996. The Options shall be
valid for a period of five (5) years from the date of vesting and the exercise
price for these Options shall be $2.50 per share. These Options are awarded
under the terms and provisions of the 1996 Plan.
Mr. Weitzel received, effective September 30, 1995, options to purchase
100,000 shares of the Company's stock. The options vested on September 30, 1995
and shall be valid for a period of five (5) years from the date of issue and
shall expire on September 29, 2000. The exercise price for these 100,000 shares
is the closing price of the Company's stock on September 30, 1995 ($.8125).
Relocation Expenses. Mr. Weitzel was reimbursed by the Company for the reason-
able costs incurred in relocating from Wisconsin to South Carolina, including
real estate commissions and closing costs paid in the sale of his residence;
these costs were not to exceed $35,000. In addition, the Company reimbursed Mr
Weitzel for up to 6 months of temporary living costs -- apartment rental and
round-trip flight to Wisconsin every 2 weeks -- prior to his permanent
relocation.
Covenant Not To Compete. The Employee agrees that for a period of one year
after the date of termination of his employment for any reason except a termin-
ation without cause, the Employee shall not solicit any customers or prospective
customers in any state in which the Company (including its subsidiaries) engages
in business, with whom the Employee became acquainted or gained knowledge of
during the course of his employment, and the Employee shall not engage in any
business which is in any way competitive with the business of the Company. The
Employee further agrees never to disclose any information deemed proprietary by
the Company, including but not limited to, customer lists and trade secrets,
regardless of the Employee's employment status.
Termination. Each party shall have the right to terminate the Agreement at any
time during the term upon thirty (30) days written notice to the other party.
The Company may terminate the Agreement at any time with cause or upon thirty
(30) days written notice without cause; provided, that if the Company terminates
the Agreement without cause the Company will pay the Employee within ten (10)
days after termination, one year's base salary as severance pay. In the event
that during the term of the Agreement, there is a sale of all or substantially
all of the Company's assets or all or substantially all of the Company's stock
and the new owners express their desire for a change in management or reassign
the Employee to a job with the Company with lesser duties or responsibilities,
then the Employee has the right to give written notice of his intent to
terminate the Agreement and shall receive the remaining balance or amount due
under the Agreement as severance.
Compensation Committee Interlocks and Insider Participation in Compensation
Decisions
None of the members of the Compensation Committee is or was formerly an
officer or employee of the Company or any of its subsidiaries.
Report of the Board of Directors on Executive Compensation
The primary elements of the Company's executive compensation program have
historically consisted of a base salary, a bonus opportunity and stock options.
Base salaries are determined, and have at times been increased, by evaluating
the responsibilities of the position held and the experience of the executive
officer. Overall compensation is based on the Compensation Committee's assess-
ment of prevailing market compensation levels. The foregoing has been provided
by the Company's Compensation Committee.
John P. Seibels (Chairman) Claude E. McCain
Albert H. Cox, Jr. George R.P. Walker, Jr.
Stock Performance Chart
The following chart compares the yearly percentage change in the cumulative
total shareholder return on the Company's Common Stock during the five years
through December 1995 with the cumulative total return on the NASDAQ Stock
Market (US companies) Index and the NASDAQ Fire, Marine and Casualty Insurance
Stock Index.
Comparison of Five Year-Cumulative Total Returns
Performance Graph for
The Seibels Bruce Group Inc.
Prepared by the Center for Research in Security Prices
Produced on 02/02/96 including data to 12/29/95
(Chart Omitted)
$300
$200
$100
$0
12/31/90 12/31/91 12/31/92 12/31/93 12/31/94 12/29/95
Legend
Symbol CRSP Total 12/31/90 12/31/91 12/31/92 12/31/93 12/31/94 12/29/95
Returns
Index for:
- - ------- ---------- -------- -------- ---------- --------- -------- --------
_______ The Seibels 100.0 136.3 46.5 43.4 62.0 37.2
Bruce Group
Inc.
...----- NASDAQ Stock 100.0 160.6 186.9 214.5 209.7 296.3
Market (US
Companies)
xxx---- NASDAQ Stock 100.0 142.7 192.3 198.0 190.7 267.4
(SIC 6330-
6339 US
Companies)
Fire, Marine
and Casualty
Insurance
Notes:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
c. If the monthly interval, based on the fiscal year-end, is not a trading day
the preceding trading day is used.
D. The index level for all series was set to $1.00 on 12/31/90.
CONSIDERATION OF RESOLUTION RATIFYING SELECTION OF ARTHUR
ANDERSEN LLP TO BE INDEPENDENT ACCOUNTANTS FOR THE COMPANY
(PROPOSAL 2)
One of the purposes of the Meeting is to ratify the selection of independent
accountants to audit the books, records, and accounts of the Company and its
subsidiaries for the year ending December 31, 1996. Arthur Andersen LLP has
served as the Company's independent accountants since December 28, 1992. On
September 25, 1996 acting on the recommendation of the Audit Committee, the
Board of Directors adopted resolutions directing the employment of Arthur
Andersen LLP to audit the books, records, and accounts of the Company for 1996
and the submission of the selection to the shareholders for ratification.
Accordingly, the Board recommends the adoption of the following resolution:
RESOLVED, that the selection by the board of directors of the firm of Arthur
Andersen LLP to audit the books, records, and accounts of the Company and its
subsidiaries for the year ending December 31, 1996, be ratified.
A representative of Arthur Andersen LLP is expected to be present at the
Meeting and will have the opportunity to make a statement, and will be available
to answer questions from shareholders.
The Board of Directors recommends a vote FOR ratification of the appointment of
independent accountants.
CONSIDERATION OF RESOLUTION RATIFYING ISSUANCE OF SHARES TO
N0N-EMPLOYEE DIRECTORS (PROPOSAL 3)
One of the purposes of the Meeting is to ratify the actions taken by the Board
of Directors at a meeting held June 13, 1995 (the "June Resolution"), whereby
the Board of Directors unanimously approved a resolution awarding each non-
employee director (a total of seven directors) 5,000 shares of the common stock
of the Corporation as compensation for services rendered in 1995, in addition to
their other compensation. Rule 4460 (formerly Schedule D to the Bylaws) of the
National Association of Securities Dealers, Inc. ("NASD") (which applies to the
Company as its shares are listed on the NASDAQ) requires shareholder approval of
a plan or arrangement pursuant to which stock may be acquired by directors. The
establishment of a plan or arrangement under which the amount of securities
which may be issued does not exceed the lesser of 1% of the number of shares
out-standing or 25,000 shares does not generally require shareholder approval.
The June Resolution contemplated the issuance of 35,000 shares (5,000 shares to
each of seven non-employee directors). The Company has been advised by NASDAQ
to seek shareholder approval of the issuance of these shares to non-
employee directors. Accordingly, the Board recommends the adoption of the
following resolution:
RESOLVED, that the action of the Board of Directors dated June 13, 1995,
authorizing the one time issuance of 5,000 shares of common stock of The
Seibels Bruce Group, Inc., to each outside Director of the Company be ratified
and approved.
The Board of Directors recommends a vote FOR this proposal.
Other Business
There is no reason to believe that any other business will be presented at this
Meeting; however, if any other business should properly and lawfully come before
the Meeting, the proxies will vote in accordance with their best judgment.
Shareholder Proposals
For a shareholder proposal to be presented at the next annual meeting, it must
be received by the Company at its principal executive offices not later than
January 27, 1997, in order to be included in the proxy statement and proxy for
the 1997 annual meeting. Any such proposal should be addressed to the Company's
Corporate Secretary and delivered to the Company's principal executive offices
at 1501 Lady Street, Columbia, South Carolina or mailed to PO Box 1, Columbia,
South Carolina 29202.
Priscilla C. Brooks
Corporate Secretary
October 28, 1996
