FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______.
Commission file number 010042
One Valley Bancorp, Inc.
(Exact name of registrant as specified in its charter)
West Virginia 55-0609408
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
One Valley Square, Charleston, West Virginia 25326
(Address of principal executive offices)
(Zip Code)
(304) 348-7000
(Registrant's telephone number, including area code)
Not applicable
(Former name, address, and fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities and Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that
the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.
YES XXX No
The number of shares outstanding of each of the issuer's classes of common
stock as of June 30, 1997 was:
Common Stock, $10.00 par value - 21,800,806 shares
One Valley Bancorp, Inc.
Part I. Financial Information
Item 1. Financial Statements.
The unaudited interim consolidated financial statements of One Valley Bancorp,
Inc. (One Valley) or (Registrant) are included on pages 3 - 7 of this report.
These consolidated financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly,
they do not include all the information and footnotes required by generally
accepted accounting principles for annual year-end financial statements. In the
opinion of management, all adjustments considered necessary for a fair
presentation have been included and are of a normal recurring nature. Operating
results for the six month period ended June 30, 1997, are not necessarily
indicative of the results that may be expected for the year ending December 31,
1997. For further information, refer to the consolidated financial statements
and footnotes thereto included in the Registrant's Annual Report on Form 10-K
for the year ended December 31, 1996.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Management's discussion and analysis of financial condition and results of
operations is included on pages 8 - 16 of this report.
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(unaudited in thousands)
<CAPTION>
June 30 December 31 June 30
1997 1996 1996
<S> <C> <C> <C>
ASSETS
Cash and Due From Banks $148,711 $146,152 $138,062
Interest Bearing Deposits With Other Banks 10,880 9,897 11,317
Federal Funds Sold 20,650 4,825 4,437
---------- ---------- ----------
Cash and Cash Equivalents 180,241 160,874 153,816
Securities
Available-for-Sale, at fair value 1,065,187 952,908 988,796
Held-to-Maturity (Estimated Fair Value,
June 30, 1997 - $228,491; December 31, 1996 - $219,841;
June 30, 1996 - $204,085) 225,954 217,322 207,749
Loans
Total Loans 2,847,720 2,810,212 2,758,272
Less: Allowance For Loan Losses 41,127 41,745 42,150
---------- ---------- ----------
Net Loans 2,806,593 2,768,467 2,716,122
Premises & Equipment - Net 84,348 84,087 85,861
Other Assets 84,186 83,645 89,434
---------- ---------- ----------
Total Assets $4,446,509 $4,267,303 $4,241,778
========== ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Non-interest Bearing $451,255 $406,630 $392,610
Interest Bearing 3,023,733 2,999,386 2,982,373
---------- ---------- ----------
Total Deposits 3,474,988 3,406,016 3,374,983
Short-term Borrowings
Federal Funds Purchased 40,375 17,278 17,443
Repurchase Agreements and Other Borrowings 450,298 360,796 389,184
---------- ---------- ----------
Total Short-term Borrowings 490,673 378,074 406,627
Long-term Borrowings 28,880 28,892 17,898
Other Liabilities 43,347 45,744 43,145
---------- ---------- ----------
Total Liabilities 4,037,888 3,858,726 3,842,653
Shareholders' Equity:
Preferred Stock-$10 par value; 1,000,000 shares authorized
but none issued 0 0 0
Common Stock-$10 par value; 40,000,000 shares authorized,
Issued 25,158,203 shares at June 30, 1997;
24,923,176 shares at December 31, 1996;
19,871,356 shares at June 30, 1996 251,582 249,232 198,714
Capital Surplus 75,206 73,834 73,220
Retained Earnings 170,709 152,006 185,954
Unrealized Gain (Loss) on Securities Available-for-Sale,
net of deferred income taxes 465 883 (6,434)
Treasury Stock - 3,357,397 shares at June 30, 1997;
2,792,360 shares at December 31, 1996;
1,846,688 shares at June 30, 1996; at cost (89,341) (67,378) (52,329)
---------- ---------- ----------
Total Shareholders' Equity 408,621 408,577 399,125
---------- ---------- ----------
Total Liabilities and Shareholders' Equity $4,446,509 $4,267,303 $4,241,778
========== ========== ==========
</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(unaudited in thousands, except per share data)
<CAPTION>
For The Three Months For The Six Months
Ended June 30 Ended June 30
1997 1996 1997 1996
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest and Fees on Loans
Taxable $61,379 $58,327 $121,301 $113,635
Tax-Exempt 747 662 1,488 1,306
-------- -------- -------- --------
Total 62,126 58,989 122,789 114,941
Interest on Investment Securities
Taxable 16,985 15,963 33,931 29,997
Tax-Exempt 3,015 2,778 5,998 5,551
-------- -------- -------- --------
Total 20,000 18,741 39,929 35,548
Other Interest Income 328 144 715 245
-------- -------- -------- --------
Total Interest Income 82,454 77,874 163,433 150,734
INTEREST EXPENSE
Deposits 32,061 29,656 63,123 57,055
Short-term Borrowings 5,121 4,449 10,281 8,872
Long-term Borrowings 445 256 884 456
-------- -------- -------- --------
Total Interest Expense 37,627 34,361 74,288 66,383
-------- -------- -------- --------
Net Interest Income 44,827 43,513 89,145 84,351
Provision For Loan Losses 1,834 1,334 3,292 2,483
-------- -------- -------- --------
Net Interest Income
After Provision For Loan Losses 42,993 42,179 85,853 81,868
OTHER INCOME
Trust Department Income 2,681 2,488 5,176 4,680
Service Charges on Deposit Accounts 3,727 3,693 7,309 7,107
Real Estate Loan Processing & Servicing Fees 1,404 1,431 2,724 2,782
Other Service Charges and Fees 1,781 1,411 3,503 2,767
Other Operating Income 1,786 1,358 3,681 2,823
Securities Transactions 108 28 24 (266)
-------- -------- -------- --------
Total Other Income 11,487 10,409 22,417 19,893
OTHER EXPENSES
Salaries and Employee Benefits 16,494 16,358 33,319 32,674
Occupancy Expense - Net 1,645 1,673 3,317 3,410
Equipment Expenses 2,145 2,126 4,211 4,278
Federal Deposit Insurance 208 354 423 601
Outside Data Processing 1,880 1,510 3,605 2,929
Other Operating Expenses 9,779 9,357 19,174 17,703
-------- -------- -------- --------
Total Other Expenses 32,151 31,378 64,049 61,595
-------- -------- -------- --------
Income Before Taxes 22,329 21,210 44,221 40,166
Applicable Income Taxes 7,579 7,170 15,000 13,478
-------- -------- -------- --------
NET INCOME $14,750 $14,040 $29,221 $26,688
======== ======== ======== ========
NET INCOME PER COMMON SHARE $0.67 $0.64 $1.33 $1.24
======== ======== ======== ========
Based on Average Shares Outstanding of 21,907 21,985 21,978 21,488
</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Shareholders' Equity
(unaudited in thousands)
<CAPTION>
Unrealized
Gain (Loss)
on Securities
Common Capital Retained Treasury Available
Stock Surplus Earnings Stock for Sale
<S> <C> <C> <C> <C> <C>
Balance December 31, 1996 $249,232 $73,834 $152,006 ($67,378) $883
Six Months Ended June 30, 1997
Net Income 0 0 29,221 0 0
Cash Dividends ($.48 per share) 0 0 (10,518) 0 0
Change in Fair Value of Securities
Available for Sale, net of deferred taxes 0 0 0 0 (418)
Treasury Shares Purchased 0 0 0 (21,963) 0
Stock Options Exercised 2,350 1,372 0 0 0
-------- -------- -------- -------- --------
Balance June 30, 1997 $251,582 $75,206 $170,709 ($89,341) $465
======== ======== ======== ======== ========
Balance December 31, 1995 $180,166 $34,603 $168,625 ($23,344) $6,252
Stock Issued for Acquisition 17,890 37,817 0 0 0
Six Months Ended June 30, 1996
Net Income 0 0 26,688 0 0
Cash Dividends ($.44 per share) 0 0 (9,359) 0 0
Change in Fair Value of Securities 0 0 0 0 0
Available for Sale, net of deferred taxes 0 0 0 0 (12,686)
Treasury Shares Purchased 0 0 0 (28,985) 0
Stock Options Exercised 658 800 0 0 0
-------- -------- -------- -------- --------
Balance June 30, 1996 $198,714 $73,220 $185,954 ($52,329) ($6,434)
======== ======== ======== ======== ========
</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(unaudited in thousands)
<CAPTION>
For The Six Months
Ended June 30
1997 1996
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $29,221 $26,688
Adjustments To Reconcile Net Income To Net Cash
Provided by Operating Activities:
Provision For Loan Losses 3,292 2,483
Depreciation 3,877 4,066
Amortization and Accretion 1,895 2,071
Net Loss From Sales of Assets 30 352
Increase (Decrease) Due to Changes In:
Accrued Interest Receivable (1,071) (902)
Accrued Interest Payable 352 1,142
Other Assets and Other Liabilities (4,166) 833
-------- --------
Net Cash Provided by Operating Activities 33,430 36,733
INVESTING ACTIVITIES
Proceeds From Sales of Securities Available for Sale 26,900 85,806
Proceeds From Maturities of Securities Available for Sale 146,091 100,345
Proceeds From Maturities of Securities Held to Maturity 4,831 3,150
Purchases of Securities Available for Sale (286,696) (189,903)
Purchases of Securities Held to Maturity (13,496) (5,788)
Net Increase In Loans (40,301) (84,260)
Acquisition of Subsidiary, Net of Cash Paid 0 10,866
Purchases of Premises and Equipment (4,192) (4,016)
-------- --------
Net Cash Used in Investing Activities (166,863) (83,800)
FINANCING ACTIVITIES
Net Increase in Interest Bearing and Non-interest Bearing Deposits 68,972 69,515
Net Increase (Decrease) in Federal Funds Purchased 23,097 (36,562)
Net Increase in Other Short-term Borrowings 89,502 42,653
Proceeds From Long-term Borrowings 0 0
Repayment of Long-term Debt (12) (3,513)
Proceeds From Issuance of Common Stock 3,722 1,458
Purchase of Treasury Stock (21,963) (28,985)
Dividends Paid (10,518) (9,359)
-------- --------
Net Cash Provided by Financing Activities 152,800 35,207
-------- --------
Increase (Decrease) in Cash and Cash Equivalents 19,367 (11,860)
Cash And Cash Equivalents at Beginning of Year 160,874 165,676
-------- --------
Cash And Cash Equivalents, June 30 $180,241 $153,816
======== ========
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note A - Basis of Presentation
The accounting and reporting policies of One Valley conform to generally
accepted accounting principles and practices in the banking industry. The
preparation of the financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates. All significant intercompany
accounts and transactions have been eliminated in consolidation. The interim
financial information included in this report is unaudited. In the opinion of
management, all adjustments necessary for a fair presentation of the results of
the interim periods have been made. These notes are presented in conjunction
with the Notes to Consolidated Financial Statements included in the Annual
Report of One Valley.
Note B - Accounting Changes
In February 1997, the FASB issued Statement No. 128, "Earnings Per Share" (FAS
128) which supercedes APB Opinion No. 15, "Earnings Per Share" (APB 15).
Statement No. 128 is effective for financial statements for both interim and
annual periods ending after December 15, 1997. One Valley will continue to
apply APB 15 until the adoption of FAS 128. The new standard specifies the
computation, presentation, and disclosure of basic and diluted earnings per
share. Basic and fully diluted earnings per share are not anticipated to be
materially different from earnings per share under APB 15.
In June 1996, the FASB issued Statement No. 125, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities" which is
applicable to One Valley effective January 1, 1997. However, on October 30,
1996, the FASB agreed to defer the effective date for one year for the following
transactions: securities lending, repurchase agreements, dollar rolls and other
similiar secured transactions. The delay in implementation was necessary to
allow companies to overcome technological problems in their systems which would
create control and accountability issues. Statement No. 125 establishes
standards for determining whether certain transfers of financial assets should
be considered sales of all or part of the assets or as secured borrowings.
Statement No. 125 also establishes standards surrounding settlements of
liabilities through the transfer of assets to a creditor or obtaining an
unconditional release and whether these settlements should prove the debt
extinguished. The adoption of this standard did not have a material effect on
the Company's financial statements. Additionally, the delayed provisions of
this standard are not expected to have a material effect on One Valley's
financial statements.
Note C - Stock Splits and Stock Dividends
On September 18, 1996, One Valley's Board of Directors authorized a five-for-
four stock split of common shares effected in the form of a 25% stock dividend
to shareholders of record on September 30, 1996. Average shares outstanding and
per share amounts for prior periods included in the consolidated financial
statements have been adjusted for the stock split.
One Valley Bancorp, Inc.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
June 30, 1997
INTRODUCTION AND SUMMARY
Net income for the second quarter of 1997 totaled $14.8 million, a 5.1%
increase from the $14.0 million earned in the same quarter of 1996. On a per
share basis, net income increased by 4.7% to $0.67 from the $0.64 earned in the
second quarter of 1996. The improvement in earnings during the quarter is
primarily due to higher net interest income and non-interest income. Prior
period earnings per share have been adjusted for a 5 for 4 stock split declared
in September 1996.
Net income for the first six months of 1997 totaled $29.2 million, a 9.5%
increase over the first six months of 1996. Earnings per share during the six
month period were $1.33, up 7.3% from the $1.24 earned in the first six months
of 1996.
Return on average assets (ROA) measures how effectively One Valley utilizes
its assets to produce net income. ROA was 1.35% for the first six months of
1997, essentially unchanged from the 1.34% earned during the same period of
1996. Return on average equity (ROE) increased slightly to 14.34% from the
14.23% reported for the first six months of 1996.
The following discussion is an analysis of the financial condition and
results of operations of One Valley for the first six months of 1997. This
discussion should be read in conjunction with the 1996 Annual Report to
Shareholders and the other financial information included in this report.
RESULTS OF OPERATIONS
Net Interest Income
Net interest income for the six months ended June 30, 1997, was $93.2
million on a fully tax-equivalent basis, a 5.8% increase over the $88.0 million
earned during the same period in 1996. This increase is largely due to a $209.2
million, or 8.0% increase in average total loans and a $107.7 million, or 9.5%
increase in average securities during the six month comparison. In total,
average earning assets increased by $332.3 million or 9.0% during the first six
months of 1997 over the same period in 1996, while average interest bearing
liabilities increased by $281.0 million or 8.8% in the same period. Both total
interest income and total interest expense increased from the prior year due to
the increases in volume and changes in the mix of assets and liabilities.
As shown in the consolidated average balance sheets (page 16), the yield on
earning assets was 8.33% for the first six months of 1997, down from the 8.37%
for the same period in 1996. During the same period, the cost of interest
bearing liabilities increased 13 basis points to 4.33% from last year's 4.20%
level. This increase in cost of funds has resulted from a combination of
changes in the mix of interest-bearing liabilities including a higher level of
short-term and long-term borrowed funds, as well as a higher cost to attract
customer deposits in an increasingly competitive market. Additional discussion
of the changes in balance sheet mix is included later in this report. Primarily
due to the increase in the cost of interest bearing liabilities, the net
interest margin decreased to 4.62% for the first six months of 1997, from the
4.77% during the same period in 1996. Internal interest rate risk simulations
indicate that over the next twelve months a sharp rise in interest rates would
have a slightly positive influence on net interest income; whereas, a sharp
decline in rates would have a slightly negative influence on net interest
income. Normal fluctuations in market interest rates should not have a
significant impact on One Valley's net interest margin.
Credit Experience
The provision for loan losses was $3.3 million for the first six months of
1997, a $0.8 million increase from the provision made in the same period of
1996. The majority of the increase occurred in the second quarter of 1997. The
provision for loan losses was based upon One Valley's continual evaluation
process of the adequacy of the allowance for loan losses. As a percentage of
average total loans, the provision for loan losses through the first six months
of 1997 was 0.23% on an annualized basis, compared with 0.19% for the same
period in 1996. Net charge-offs as a percentage of average total loans in the
first six months of 1997 increased to 0.28% on an annualized basis, up from an
annualized 0.16% during the same period in 1996, and up from the 0.19% charge-
off ratio for the full year of 1996. The increase in the first six months has
resulted from an overall increase in consumer installment charge-offs.
Management continues to monitor this increase in charge-offs; however, the
current ratio falls well within One Valley's long range plan.
Total non-performing assets at June 30, 1997, were 0.37% of period-end
loans, unchanged from the 0.37% at December 31, 1996, and down from the 0.43% at
June 30, 1996. Non-accrual loans totaled $8.9 million at June 30, 1997, $1.3
million or 12.7% below last year's level resulting in total non-perfoming assets
at June 30, 1997, decreasing from the level one year ago. The allowance for
loan losses is sufficient to absorb nearly four times the amount of those non-
performing assets. At June 30, 1997, loans past due over 90 days were 0.19% of
outstanding loans, up from the 0.15% level at year-end 1996, and the 0.15% at
June 30, 1996. An analysis of the allowance for loan losses and non-performing
assets is included on page 15.
With the continued good credit quality of the loan portfolio, the dollars
reserved for estimated losses in the allowance for loan losses has remained
relatively unchanged since year end 1996 and is down from June 30, 1996. In
management's opinion, the allowance for loan losses is adequate to absorb the
current estimated risk of loss in the existing loan portfolio. At June 30,
1997, the allowance was 1.44% of outstanding loans, compared with the 1.49% at
year-end and the 1.53% one year ago.
Non-Interest Income and Expense
The net overhead ratio (non-interest expense less non-interest income
excluding security transactions divided by average earning assets) is a measure
of the Company's ability to control costs and equalizes the comparison of
various sized operations. As this ratio decreases, more of the net interest
margin flows to net income. One Valley's net overhead ratio for the first six
months of 1997 was 2.06%, down from 2.28% during all of 1996 and down from the
2.24% for the first six months of 1996. This improvement is a result of $332.3
million, or 9.0% growth in average earning assets with virtually no increase in
net operating costs. Net overhead increased by only $0.2 million, or 0.5% in
the first six months of 1997 compared to the same period in 1996.
Total non-interest income was $22.4 million through the first six months of
1997, up 11.1% from the $20.2 million non-interest income earned during the same
period in 1996. Trust income increased by 10.6% from the same period last year
due to new business and increases in the market value of trust assets managed.
Service charges on deposit accounts increased by 2.8% in the first six month
comparison mainly due to a higher level of customer activity. Real estate loan
processing and service fees decreased by 2.1% when compared to the first six
months of 1996 due to a slightly lower level of loans originated and serviced
for the secondary market. Other service charges and fees increased by 26.6%
over the first six months of 1996, primarily due to increases in fee income from
non-One Valley customer use of the Company's network of automated teller
machines which was recently expanded to 212 machines throughout West Virginia
and contiguous states. Other operating income increased by 30.4% due primarily
to other non-recurring income reported by the building management subsidiary of
the Company in the first quarter of 1997 and the introduction of a new debit
card product in the third quarter of 1996.
Total non-interest expense was $64.0 million during the six months ended
June 30, 1997, a 4.0% increase from the $61.6 million experienced during the
same period in 1996, largely due increases in other operating expenses. Staff
costs increased by 2.0% from the level one year ago primarily due to increases
in employee benefit costs. Staffing levels have declined by 2.5% from June 30,
1996, as operations are continually being streamlined and levels are reduced
through normal attrition. The savings were offset by normal salary and benefit
increases. Occupancy expense decreased by 2.7% from the same period last year
primarily due to lower utility costs and other occupancy expenses. Federal
deposit insurance expense for the first six months of 1997 was $0.2 million or
29.6% less than the same period last year due to the reduced assessment rate
after the one-time SAIF adjustment in September 1996 that replenished that fund.
It is anticipated that this new rate will continue to be assessed throughout the
remainder of 1997. Outside data processing expense increased by 23.1% above the
level at June 30, 1996. This increase is due to the conversion of Lynchburg
operations to the common data processing system and enhanced computer service
required to support various customer products and services, such as ATM
processing, the VISA Checkcard, trust accounts, broker-dealer transactions, and
mortgage lending. Other operating expenses increased 8.3% in the first six
months of 1997. Nearly one-third of this increase was due to the increase in
intangible amortization related to the new Lynchburg operations. The remainder
is due to the new registration with the New York Stock Exchange, advertising
campaign expense, increases in postage costs from customer mailings in the first
six months of 1997, increases in training and education costs related to new
technology and other strategic initiatives, and increases in insurance coverage
costs during 1997.
Income tax expense increased by $1.5 million, or 11.3%, for the first six
months of 1997 compared with the same period in 1996. The increase in taxes is
primarily a result of the 10.1% growth in pretax earnings. One Valley's
effective income tax rate for the first six months of 1997 was 33.9% compared to
33.6% during the same period in 1996.
FINANCIAL CONDITION
Asset Structure
Total loans at June 30, 1997, exceeded June 30, 1996, levels by 3.2% or
$89.4 million. The consolidated loan-to-deposit ratio has increased slightly to
80.8% at June 30, 1997, compared to 80.5% at June 30, 1996. The increase in
total loans from one year ago is the result of balanced growth in the
commercial, mortgage, and other consumer loan categories such as home equity and
revolving credit products. These increases were only partially offset by
decreases in consumer auto loans.
Investment portfolio assets increased $120.9 million or 10.3% from the
level at year-end and by $94.6 million or 7.9% from the level one year ago. One
Valley purchased a relatively balanced mixture of Treasury, tax exempt, mortgage
backed, and other securities over the level in the portfolio at year end and
June 30, 1996. The increases are due to One Valley's asset/liability strategy
which strives to minimize interest rate risk while enhancing the financial
position of the Company.
Securities designated as available-for-sale at June 30, 1997, had a
historical cost of $1.1 billion, with an unrealized gain of approximately $0.8
million. This unrealized increased shareholders' equity by $0.5 million, net of
$0.3 million in deferred income taxes. At year-end December 31, 1996, and June
30, 1996, securities available-for-sale had a historical cost of $951.4 million
and $999.5 million, with an unrealized gain of approximately $1.5 million and an
unrealized loss of $10.7 million, respectively. The unrealized gain increased
shareholders' equity by $0.9 million while the unrealized loss decreased equity
by $6.4 million, net of $0.6 and $4.3 million in deferred income taxes,
respectively.
At the time of purchase, management determines the appropriate
classification of securities. Securities to be held for indefinite periods of
time and not intended to be held to maturity or on a long-term basis are
classified as available-for-sale and carried at fair value. The corresponding
difference between the historical cost and the current fair value of these
securities, the unrealized gain or loss, is an adjustment to shareholders'
equity, net of deferred income taxes. Securities available-for-sale include
securities that management intends to use as part of its asset/liability
management strategy and that may be sold in response to changes in interest
rates, resultant prepayment risk, and other related risk factors. If management
has the positive intent and One Valley has the ability at the time of purchase
to hold securities until maturity, they are classified as held-for-investment
and carried at amortized historical cost adjusted for amortization of premiums
and accretion of discounts, which are recognized as adjustments to interest
income.
In order to improve its fully tax equivalent net interest income and to
hedge against higher income tax rates, One Valley increased its holdings of tax-
exempt securities that were offering attractive yields over the last several
years. As shown on the consolidated average balance sheets (page 16), average
tax-exempt securities through June 30, 1997 increased by 10.2% or $20.8 million
over the average at June 30, 1996. One Valley will continue to monitor its
investment opportunties and may purchase additional tax-exempt securities of
similar yield and quality.
Federal funds sold at June 30, 1997, were $20.7 million, up $15.8 million
from year-end and up $16.2 million from one year ago. Fluctuations in federal
funds sold are normal and largely due to planned changes in the Company's
asset/liability structure in order to maximize the return on investment in
response to changes in the interest rate environment.
Liability Structure
Total deposits at June 30, 1997, increased 2.0% from the level at year-end
and $100.0 million or 3.0% since June 30, 1996. In recent years growth in
banking deposits has been modest. Due to the low interest rate environment,
deposit customers are shortening the maturities of their deposit reinvestments
and seeking higher yielding non-deposit investment alternatives. The majority
of the growth in One Valley's core deposits has been in a new money market
deposit account and in fixed rate certificates of desposit. Demand deposits are
up 14.9% from June one year ago primarily due to approximately a $23.7 million
increase in commercial and consumer deposits on deposit with One Valley at
period end June 30, 1997. The average rate paid on interest bearing deposits
increased to 4.23% in the first six months of 1997, up from the 4.15% average
rate paid for all of 1996, and the 4.11% average rate paid in the first six
months of 1996 largely due to increased rates on certificates of deposit and the
new money market product. In an effort to meet customer demand for non-deposit
investment alternatives, One Valley operates a fully licensed NASD Broker/Dealer
subsidiary and continues to expand other product lines.
Total short-term borrowings increased by $112.6 million or 29.8% from the
year-end level, and increased $84.0 million or 20.7% from the level at June 30,
1996. Short-term borrowings, which consist of Federal funds purchased from
correspondent banks, repurchase agreements with large corporate and public
entities, advances on credit lines available to the Company, and commercial
paper, can fluctuate significantly depending upon loan demand, deposit growth,
and One Valley's asset/liablility strategy. The increased level of short-term
borrowings has been used to fund the higher level of investment portfolio assets
as planned under One Valley's asset/liability management program.
Long-term borrowings increased $11.0 million or 61.4% since June 30, 1996.
The increase since June one year ago was the result of activity of the Lynchburg
affiliate during 1996, as One Valley integrated the acquisition into its
existing asset/liability management strategy. Partially offsetting the debt
acquired were $4.0 million in payments primarily on long-term advances from the
Federal Home Loan Bank (FHLB). As a result, One Valley now has $28.9 million of
long-term borrowings, primarily FHLB borrowings, with repayment schedules from
one to seven years. Approximately $7.0 million of these borrowings will mature
in the fourth quarter of 1997 and $12.0 million will mature in 1998.
Capital Structure and Liquidity
On September 18, 1996, One Valley approved a 5 for 4 stock split effected
in the form of a 25% stock dividend. On October 9, 1996, One Valley
shareholders received one additional share of One Valley common stock for each
four shares of stock they held as of the record date, September 30, 1996.
Customary with a stock split, the market value and all per share information for
prior periods presented have been adjusted to reflect the additional shares
outstanding.
One Valley's equity-to-asset ratio was 9.19% at June 30, 1997, down from
the 9.57% at December 31, 1996, and down from the 9.41% one year ago. The
equity-to-asset ratio, while remaining strong, decreased in these comparisons
due to a 4.0% increase in total assets, coupled with the repurchase of common
shares of One Valley Bancorp stock in the open market which was initiated in
conjunction with the CSB Financial acquisition.
The Board of Directors has authorized management to repurchase shares of
One Valley Bancorp common stock in the open market. In January 1996,
simultaneous with the announced merger agreement between One Valley and CSB
Financial, the Board of Directors authorized management to repurchase the 2.2
million shares of One Valley common stock (adjusted for the 5 for 4 stock split)
that would be issued as a result of the acquisition. As of June 30, 1997, One
Valley held 3.4 million shares of treasury stock and has remaining Board
authorization for the repurchase of 344,000 additional shares. Any purchases
under this or previous authorizations will depend upon future market conditions.
One Valley's cash dividend, totaling $0.48 per share for the first six
months of 1997, was up 9.1% over the $0.44 per share dividend during the same
period in 1996. One Valley's dividend policy coupled with the continued growth
in net income, demonstrates management's commitment to a strong equity-to-asset
ratio benefiting both the investor and the customer in the local community. One
Valley's risk based capital ratio at June 30, 1997 was 15.75%, well above the
8.0% required, while its Tier I capital ratio was 14.50%. One Valley's strong
capital position is demonstrated further by its leverage ratio of 8.78% compared
to regulatory guidance of 4.0% to 5.0%. The capital ratios of the banking
subsidiaries also remain strong and allow them to effectively serve the
communities in which they are located.
The capital positions of the banks, coupled with proper asset/liability
matching and the stable nature of the primarily consumer base of core deposits,
results in the maintenance of a strong liquidity position. The liquidity of the
parent company is dependent upon dividends from its banking subsidiaries which,
although restricted by banking regulations, are adequate to meet its cash needs.
Effects of Changing Prices
The results of operations and financial condition presented in this report
are based on historical cost, unadjusted for the effects of inflation.
Inflation affects One Valley in two ways. One is that inflation can result in
increased operating costs which must be absorbed or recovered through increased
prices for services. The second effect is on the purchasing power of the
corporation. Virtually all of a bank's assets and liabilities are monetary in
nature. Regardless of changes in prices, most assets and liabilities of the
banking subsidiaries will be converted into a fixed number of dollars. Non-
earning assets, such as premises and equipment, do not comprise a major portion
of One Valley's assets; therefore, most assets are subject to repricing on a
more frequent basis than in other industries. One Valley's ability to offset
the effects of inflation and potential reductions in future purchasing power
depends primarily on its ability to maintain capital levels by adjusting prices
for its services and to improve net interest income by maintaining an effective
asset/liability mix.
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Analysis of Loan Losses and Non-Performing Assets
(unaudited in thousands)
<CAPTION>
For The Three Months For The Six Months
Ended June 30 Ended June 30
1997 1996 1997 1996
<S> <C> <C> <C> <C>
ALLOWANCE FOR LOAN LOSSES
Balance, Beginning of Period $42,005 $39,836 $41,745 $39,534
Loan Losses 3,122 1,603 4,817 2,861
Loan Recoveries 410 356 907 767
------- ------- ------- -------
Net Charge-offs 2,712 1,247 3,910 2,094
Balance of Acquired Subsidiary 0 2,227 0 2,227
Provision For Loan Losses 1,834 1,334 3,292 2,483
------- ------- ------- -------
Balance, End of Period $41,127 $42,150 $41,127 $42,150
======= ======= ======= =======
Total Loans, End of Period $2,847,720 $2,758,272
Allowance For Loan Losses As a % of Total Loans 1.44 1.53
========== ==========
NON-PERFORMING ASSETS AT QUARTER END
Non-Accrual Loans $8,854 $10,140
Foreclosed Properties 1,672 1,670
------- -------
Total Non-Performing Assets $10,526 $11,810
======= =======
Non-Performing Assets As a % of Total Loans 0.37 0.43
Loans Past Due Over 90 Days $5,512 $4,263
Loans Past Due Over 90 Days As a % of Total Loans 0.19 0.15
</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Average Balance Sheets
(unaudited in thousands)
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
1997 1996 1997 1996
Amount Yield/Rate Amount Yield/Rate Amount Yield/Rate Amount Yield/Rate
(pct.) (pct.) (pct.) (pct.)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Loans
Taxable $2,771,671 8.88 $2,635,552 8.90 $2,761,906 8.83 $2,558,637 8.93
Tax-Exempt 46,367 9.94 41,759 9.81 46,576 9.91 40,661 9.94
---------- ---------- ---------- ----------
Total 2,818,038 8.90 2,677,311 8.92 2,808,482 8.85 2,599,298 8.95
Less: Allowance for Losses 42,134 41,472 42,082 40,596
---------- ---------- ---------- ----------
Net Loans 2,775,904 9.03 2,635,839 9.06 2,766,400 8.99 2,558,702 9.09
Securities
Taxable 1,012,835 6.71 970,658 6.58 1,013,160 6.70 926,312 6.48
Tax-Exempt 226,797 8.18 204,866 8.34 225,223 8.19 204,406 8.36
---------- ---------- ---------- ----------
Total 1,239,632 6.98 1,175,524 6.89 1,238,383 6.97 1,130,718 6.82
Federal Funds Sold & Other 27,910 4.71 15,104 3.83 30,797 4.68 13,878 3.55
---------- ---------- ---------- ----------
Total Earning Assets 4,043,446 8.37 3,826,467 8.37 4,035,580 8.33 3,703,298 8.37
Other Assets 279,924 287,132 279,067 271,465
---------- ---------- ---------- ----------
Total Assets $4,323,370 $4,113,599 $4,314,647 $3,974,763
========== ========== ========== ==========
LIABILITIES AND EQUITY
Interest Bearing Liabilities
Deposits $3,020,502 4.26 $2,895,481 4.12 $3,008,483 4.23 $2,788,468 4.11
Short-term Borrowings 411,110 5.00 379,996 4.71 422,314 4.91 375,267 4.75
Long-term Borrowings 28,883 6.18 16,789 6.13 28,886 6.17 14,993 6.12
---------- ---------- ---------- ----------
Total Interest
Bearing Liabilities 3,460,495 4.36 3,292,266 4.20 3,459,683 4.33 3,178,728 4.20
Non-interest Bearing Deposits 410,160 393,709 401,441 381,159
Other Liabilities 46,920 40,347 45,843 39,703
---------- ---------- ---------- ----------
Total Liabilities 3,917,575 3,726,322 3,906,967 3,599,590
Shareholders' Equity 405,795 387,277 407,680 375,173
---------- ---------- ---------- ----------
Total Liabilities & Equity $4,323,370 $4,113,599 $4,314,647 $3,974,763
========== ========== ========== ==========
Interest Income To Earning Assets 8.37 8.37 8.33 8.37
Interest Expense To Earning Assets 3.73 3.61 3.71 3.60
------ ------ ------ ------
Net Interest Margin 4.64 4.76 4.62 4.77
====== ====== ====== ======
<FN> Note: Yields are computed on a fully taxable equivalent basis using the rate of 35%.
</TABLE>
<PAGE>
One Valley Bancorp, Inc.
Part II. Other Information
Item 4. Submission of Matters to a Vote of Security Holders.
The Regular Annual Meeting of Shareholders of One Valley was held on April 22,
1997. At that meeting the matters set forth below were voted upon. The number
of votes cast for, against or withheld, as well as the number of abstentions and
broker non-votes concerning each matter and nominee are indicated in the
following tabulation.
1. Election of Directors
Withheld & Broker
Nominee For Against Abstentions Non-Votes
Bone 18,582,176 0 185,272 0
Cohen 18,564,962 0 185,272 0
Johnson 18,581,509 0 185,272 0
Kamm 18,584,246 0 185,272 0
Maier 18,588,687 0 185,272 0
Morrison 18,586,044 0 185,272 0
Peyton 18,577,388 0 185,272 0
Rice 18,569,534 0 185,272 0
Walker 18,588,064 0 185,272 0
Wilkerson 18,582,863 0 185,272 0
2. Approve Selection of Auditors
Withheld & Broker
Nominee For Against Abstentions Non-Votes
Ernst & Young 18,687,182 21,178 57,462 0
3. Approve Amendment to the Articles of Incorporation to update the
indemnification provision.
Withheld & Broker
For Against Abstentions Non-Votes
18,535,789 86,578 143,454 1
One Valley Bancorp, Inc.
Part II. Other Information
Item 6. Exhibits and Reports on Form 10-Q
a.) Exhibits
3.(i) Articles of Incorporation of One Valley amended April 22, 1997.
11. Statement of Computation of Earnings per Share - page 34 attached.
27. Financial Data Schedule - electronic filing only.
b.) Reports on Form 8-K
Announcement of trading on the New York Stock Exchange (NYSE)
May 19, 1997
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
One Valley Bancorp, Inc.
DATE August 14, 1997
BY /s/ Laurance G. Jones
Laurance G. Jones
Executive Vice President and
Chief Financial Officer
BY /s/James A. Winter
James A. Winter
Chief Accounting Officer
and Assistant Treasurer
<TABLE>
Exhibit 11
Statement Re: Computation of Earnings per Share
<CAPTION>
For The Three Months For The Six Months
Ended June 30 Ended June 30
1997 1996 1997 1996
<S> <C> <C> <C> <C>
PRIMARY:
Average Shares Outstanding 21,907,000 21,985,000 21,978,000 21,488,000
Net effect of the assumed exercise
of stock options - based on the
treasury stock method 274,000 226,000 310,000 160,000
------------ ------------ ------------ ------------
Total 22,181,000 22,211,000 22,288,000 21,648,000
============ ============ ============ ============
Net Income $14,750,000 $14,040,000 $29,221,000 $26,688,000
Per Share Amount $0.66 $0.63 $1.31 $1.23
============ ============ ============ ============
FULLY DILUTED:
Average Shares Outstanding 21,907,000 21,985,000 21,978,000 21,488,000
Net effect of the assumed exercise
of stock options - based on the
treasury stock method 333,000 266,000 390,000 210,000
------------ ------------ ------------ ------------
Total 22,240,000 22,251,000 22,368,000 21,698,000
============ ============ ============ ============
Net Income $14,750,000 $14,040,000 $29,221,000 $26,688,000
Per Share Amount $0.66 $0.63 $1.31 $1.23
============ ============ ============ ============
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF INCOME OF ONE VALLEY BANCORP AS
WELL AS SUPPLEMENTAL SCHEDULES OF THE ANALYSIS OF LOAN LOSSES AND NON-PERFORMING
ASSETS AND THE CONSOLIDATED AVERAGE BALANCE SHEETS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES.
</LEGEND>
<CIK> 0000351616
<NAME> ONE VALLEY BANCORP, INC.
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 148711
<INT-BEARING-DEPOSITS> 10880
<FED-FUNDS-SOLD> 20650
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 1065187
<INVESTMENTS-CARRYING> 225954
<INVESTMENTS-MARKET> 228491
<LOANS> 2847720
<ALLOWANCE> 41127
<TOTAL-ASSETS> 4446509
<DEPOSITS> 3474988
<SHORT-TERM> 490673
<LIABILITIES-OTHER> 43347
<LONG-TERM> 28880
0
0
<COMMON> 251582
<OTHER-SE> 157039
<TOTAL-LIABILITIES-AND-EQUITY> 4446509
<INTEREST-LOAN> 122789
<INTEREST-INVEST> 39929
<INTEREST-OTHER> 715
<INTEREST-TOTAL> 163433
<INTEREST-DEPOSIT> 63123
<INTEREST-EXPENSE> 74288
<INTEREST-INCOME-NET> 89145
<LOAN-LOSSES> 3292
<SECURITIES-GAINS> 24
<EXPENSE-OTHER> 64049
<INCOME-PRETAX> 44221
<INCOME-PRE-EXTRAORDINARY> 44221
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 29221
<EPS-PRIMARY> 1.33
<EPS-DILUTED> 1.33
<YIELD-ACTUAL> 4.62
<LOANS-NON> 8854
<LOANS-PAST> 5512
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 41745
<CHARGE-OFFS> 4817
<RECOVERIES> 907
<ALLOWANCE-CLOSE> 41127
<ALLOWANCE-DOMESTIC> 41127
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
Exhibit 3
RESTATED
ARTICLES OF INCORPORATION
OF
ONE VALLEY BANCORP, INC.
ARTICLE I
The name of the Corporation shall be One Valley Bancorp, Inc.
ARTICLE II
The address of the principal office of said corporation will be One Valley
Square, in the City of Charleston, in the County of Kanawha and State of West
Virginia, 25326.
ARTICLE III
The purpose or purposes for which this corporation is formed are as
follows: To transact any or all lawful business for which corporations may be
incorporated under the corporation laws of the State of West Virginia.
ARTICLE IV
No shareholder or other person shall have any preemptive rights
whatsoever.
ARTICLE V
Provisions for the Regulation of the
Internal Affairs of the Corporation
A. Indemnification. Each person who was or is a party or is threatened
to be made a party to or is involved (including, without limitation, as a
witness or deponent) in any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative, investigative or otherwise
in nature ("Proceeding"), by reason of the fact that he or she, or a person of
whom he or she is the legal representative, is or was a director or officer of
the corporation or is or was serving at the written request of the corporation's
board of directors, president or their delegate as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans, whether
the basis of such Proceeding is alleged action or omission in an official
capacity as a director, officer, trustee, employee or agent or in any other
capacity, shall be indemnified and held harmless by the corporation to the
fullest extent authorized by law, including but not limited to the West Virginia
Code, as the same exists or may hereafter be amended (but, in the case of any
such amendment, only to the extent that such amendment permits the corporation
to provide broader indemnification rights than said Code permitted the
corporation to provide prior to such amendment), against all expenses, liability
and loss (including, without limitation, attorneys' fees and disbursements,
judgments, fines, ERISA or other similar or dissimilar excise taxes or penalties
and amounts paid or to be paid in settlement) incurred or suffered by such
person in connection therewith; provided, however, that the corporation shall
indemnify any such person seeking indemnity in connection with a Proceeding (or
part thereof) initiated by such person only if such Proceeding (or part thereof)
was authorized by the Board of Directors of the corporation; provided, further,
that the corporation shall not indemnify any person for civil money penalties or
other matters, to the extent such indemnification is specifically not
permissible pursuant to federal or state statute or regulation, or order or rule
of a regulatory agency of the federal or state government with authority to
enter, make or promulgate such order or rule. Such right shall include the
right to be paid by the corporation expenses, including, without limitation,
attorneys' fees and disbursements, incurred in defending or participating in any
such Proceeding in advance of its final disposition; provided, however, that the
payment of such expenses in advance of the final disposition of such Proceeding
shall be made only upon delivery to the corporation of an undertaking, by or on
behalf of such director or officer, in which such director or officer agrees to
repay all amounts so advanced if it should be ultimately determined that such
person is not entitled to be indemnified under this Article or otherwise. The
termination of any Proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interest of the
corporation, or that such person did have reasonable cause to believe that his
conduct was unlawful.
B. Right of Claimant to Bring Suit. If a claim under this Article is
not paid in full by the corporation within thirty days after a written claim
therefor has been received by the corporation, the claimant may at any time
thereafter bring suit against the corporation to recover the unpaid amount of
the claim and, if successful, in whole or in part, the claimant shall be
entitled to be paid also the expense of prosecuting such claim. It shall be a
defense to any such action (other than an action brought to enforce a claim for
expenses incurred in defending or participating in any Proceeding in advance of
its final disposition where the required undertaking has been tendered to the
corporation) that the claimant has not met the standards of conduct which make
it permissible under the applicable law for the corporation to indemnify the
claimant for the amount claimed, but the burden of proving such defense shall be
on the corporation.
Neither the failure of the corporation (including its Board of Directors,
independent legal counsel, or its shareholders) to have made a determination
prior to the commencement of such action that indemnification or reimbursement
of the claimant is permitted in the circumstances because he or she has met the
applicable standard of conduct, nor an actual determination by the corporation
(including its Board of Directors, independent legal counsel, or its
shareholders) that the claimant has not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the claimant has
not met the applicable standard of conduct.
C. Contractual Rights: Applicability. The right to be indemnified or
to the reimbursement or advancement of expenses pursuant hereto (i) is a
contract right based upon good and valuable consideration, pursuant to which the
person entitled thereto may bring suit as if the provisions hereof were set
forth in a separate written contract between the corporation and the director or
officer, (ii) is intended to be retroactive and shall be available with respect
to events occurring prior to the adoption hereof, and (iii) shall continue to
exist after the rescission or restrictive modification hereof with respect to
events occurring prior thereto.
D. Requested Service. Any director or officer of the corporation
serving, in any capacity, (i) another corporation of which five percent (5%) or
more of the shares entitled to vote in the election of its directors is held by
the corporation, or (ii) any employee benefit plan of the corporation or of any
corporation referred to in clause (i), shall be deemed to be doing so at the
request of the corporation.
E. Non-Exclusivity of Rights. The rights conferred on any person
hereunder shall not be exclusive of and shall be in addition to any other right
which such person may have or may hereafter acquire under any statute,
provision of the Certificate of Incorporation, Bylaws, agreement, vote of
shareholders or disinterested directors or otherwise.
F. Insurance. The corporation may purchase and maintain insurance, at
its expense, to protect itself and any director, officer, employee or agent of
the corporation or another corporation, partnership, joint venture, trust or
other enterprise against such expense, liability or loss, whether or not the
corporation would have the power to indemnify such person against such expense,
liability or loss under West Virginia law.
Article V.1. Board of Directors
(a) Number, election and terms. Except as otherwise fixed by or
pursuant to the provisions of Article VI hereof relating to the rights of the
holders of any class or series of stock having a preference over the Common
Stock as to dividends or upon liquidation to elect additional directors under
specified circumstances, the number of the directors of the Corporation shall be
fixed from time to time by or pursuant to the Bylaws of the Corporation. The
directors, other than those who may be elected by the holders of any class or
series of stock having a preference over the Common Stock as to dividends or
upon liquidation, shall be classified, with respect to the time for which they
severally hold office, into three classes, as nearly equal in number as
possible, as shall be provided in the manner specified in the Bylaws of the
Corporation, one class to be originally elected for a term expiring at the
annual meeting of stockholders to be held in 1987, another class to be
originally elected for a term expiring at the annual meeting of stockholders to
be held in 1988, and another class to be originally elected for a term expiring
at the annual meeting of stockholders to be held in 1989, with each class to
hold office until its successor is elected and qualified. At each annual
meeting of the stockholders of the Corporation, the successors of the class of
directors whose term expires at that meeting shall be elected to hold office for
a term expiring at the annual meeting of stockholders held in the third year
following the year of their election.
(b) Stockholder nomination of director candidates. Advance notice of
stockholder nominations for the election of directors shall be given in the
manner provided in the Bylaws of the Corporation.
(c) Newly created directorships and vacancies. Except as otherwise
provided for or fixed by or pursuant to the provisions of Article VI hereof
relating to the rights of the holders of any class or series of stock having a
preference over the Common Stock as to dividends or upon liquidation to elect
directors under specified circumstances, newly created directorships resulting
from any increase in the number of directors and any vacancies on the Board of
Directors resulting from death, resignation, disqualification, removal or other
cause shall be filled by the affirmative vote of a majority of the remaining
directors then in office, even though less than a quorum of the Board of
Directors. Any director elected in accordance with the preceding sentence to
fill a vacancy resulting from death, resignation, disqualification, removal or
other cause shall hold office for the remainder of the full term of the class of
directors in which the vacancy occurred and until such director's successor
shall have been elected and qualified and directors elected in accordance with
the preceding sentence by reason of an increase in the number of directors shall
hold office only until the next election of directors by the shareholders and
until such director's successor shall have been elected and qualified. No
decrease in number of directors constituting the Board of Directors shall
shorten the term of any incumbent director.
(d) Removal. Subject to the rights of any class or series of stock
having a preference over the Common Stock as to dividends or upon liquidation to
elect directors under specified circumstances, any director may be removed from
office, with or without cause, and only by the affirmative vote of the holders
of 80% of the combined voting power of the then outstanding shares of stock
entitled to vote generally in the election of directors, voting together as a
single class.
(e) Amendment, repeal, etc. Notwithstanding anything contained in
these Articles of Incorporation to the contrary, the affirmative vote of the
holders of at least 80% of the voting power of all shares of the Corporation
entitled to vote generally in the election of directors, voting together as a
single class, shall be required to alter, amend, or adopt any provision
inconsistent with or repeal this Article V.1.
Article V.2. Bylaw Amendments
The Board of Directors shall have power to make, alter, amend and repeal
the Bylaws of the Corporation (except so far as the Bylaws of the Corporation
adopted by the stockholders shall otherwise provide). Any Bylaws made by the
directors under the powers conferred hereby may be altered, amended or repealed
by the directors or by the stockholders. Notwithstanding the foregoing and
anything contained in these Articles of Incorporation to the contrary, Article
II, Sections 1, 4 and 13, Article III, Sections 2, 9, and 13, and Article XI of
the Bylaws shall not be altered, amended or repealed and no provision
inconsistent therewith shall be adopted without the affirmative vote of the
holders of at least 80% of the voting power of all the shares of the Corporation
entitled to vote generally in the election of directors, voting together as a
single class. Notwithstanding anything contained in these Articles of
Incorporation to the contrary, except as otherwise provided by law for separate
class votes, the affirmative vote of the holders of at least 80% of the voting
power of all the shares of the Corporation entitled to vote generally in the
election of directors, voting together as a single class, shall be required to
alter, amend or adopt any provision inconsistent with or repeal this Article
V.2.
ARTICLE VI
The amount of total authorized capital stock of the corporation shall be
Forty-One Million shares, consisting of Forty Million shares of Common Stock
with a par value of Ten Dollars ($10.00) per share and One Million shares of
Preferred Stock with a par value of Ten Dollars ($10.00) per share.
The Board of Directors shall have the power and authority at any time and
from time to time to issue, sell or otherwise dispose of any unissued but
authorized shares of any class or classes of stock presently provided for in the
Certificate of Incorporation, or that may hereafter be provided for by a
subsequent amendment to the Certificate of Incorporation, to such persons or
parties, including the holders of Common Stock or Preferred Stock or of any such
other class of stock, for such considerations (not less than the par value, if
any, thereof) and upon such terms and conditions as the Board of Directors in
its discretion may deem to be in the best interests of the Corporation. Except
as expressly provided to the contrary hereinafter, such issuance, sale or other
disposition may be made without offering such shares, or any part or class
thereof, to the holders of Common Stock or Preferred Stock or any such other
class of stock, and no such holder shall have any preemptive right to subscribe
for any such shares.
Each holder of Common Stock of the Corporation entitled to vote shall have
one vote for each share thereof held.
The voting powers, designations, preferences, limitations, restrictions and
relative rights of the Preferred Stock are as follows:
(1) Issuance in Series. Preferred stock may be issued from time to
time in one or more series. All shares of Preferred Stock shall be of equal
rank and shall be identical, except in respect of the particulars that are fixed
in the Certificate of Incorporation or may be fixed by the Board of Directors as
hereinafter provided pursuant to authority which is hereby expressly vested in
the Board of Directors; and each share of Preferred Stock, whether of the same
or a different series, shall be identical in all respects with the other shares
of Preferred Stock, except as to the following relative rights and preferences,
as to which there may be variations between different series:
(a) the rate of dividends;
(b) whether shares may be redeemed and, if so, the redemption price and
the terms and conditions of redemption;
(c) the amount payable upon shares in event of voluntary and involuntary
liquidation;
(d) sinking fund provisions, if any, for the redemption or purchase of
shares;
(e) the terms and conditions, if any, on which shares may be converted;
and
(f) voting rights, if any.
The Board of Directors of the Corporation shall have all of the power and
authority with respect to the shares of Preferred Stock that the shareholders
may delegate to the Board of Directors pursuant to the terms and provisions of
Chapter 31, Article I, Sections 78 and 79 of the Code of West Virginia, as
amended, and shall exercise such power and authority by the adoption of a
resolution or resolutions as prescribed by law.
(2) Dividends. The holders of the Preferred Stock shall be entitled to
receive, when and as declared by the Board of Directors, out of any funds
legally available therefor, cumulative preferential dividends in cash, at the
rate per annum fixed for such series, and no more. Dividends on shares of the
Preferred Stock shall accrue from the date of the initial issue of shares of
such series, or from such other date as may be fixed by the Board of Directors,
shall be cumulative, and shall be payable quarterly on the last day of March,
June, September and December in each year to shareholders of record on the
fifteenth day of the calendar month in which such dividends are payable, with
the first dividend on the Preferred Stock being payable on the respective
dividend date which follows the first full calendar quarter after the initial
issue of shares. Each share of Preferred Stock shall rank on a parity with each
other share of Preferred Stock, irrespective of series, with respect to
preferential dividends at the respective rates fixed for such series, and no
dividend shall be declared or paid or set apart for payment for the Preferred
Stock of any series unless at the same time a dividend in like proportion to the
accrued and unpaid dividends upon the Preferred Stock of each other series shall
be declared or paid or set apart for payment, as the case may be, on Preferred
Stock of each other series then outstanding. Accrued and unpaid dividends on
the Preferred Stock shall not bear interest.
(3) Dividend Restriction on Junior Stock. So long as any shares of
Preferred Stock are outstanding, the Corporation shall not pay or declare any
cash dividends whatsoever on the Common Stock or any other class of stock
ranking junior to the Preferred Stock unless (a) all dividends on the Preferred
Stock of all series for all past dividend periods shall have been paid, or
declared and a sum sufficient for the payment thereof set apart, and (b) there
shall exist no default in respect of any sinking fund or purchase fund for the
redemption or purchase of shares of Preferred Stock of any series or such
default shall have been waived by the holders of at least a majority of the then
issued and outstanding shares of Preferred Stock of such series by a vote at a
meeting called for such purpose or by written waiver with or without a meeting.
(4) Liquidation or Dissolution. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the affairs of the
Corporation, then, before any distribution or payment shall be made to the
holders of the Common Stock or any other class of stock of the corporation
ranking junior to the Preferred Stock in respect of dividends or distribution of
assets upon liquidation, the holders of the Preferred Stock shall be entitled to
be paid in full, in the event of a voluntary or involuntary liquidation,
dissolution or winding up, the respective amounts fixed for such series, plus in
each case a sum equal to accrued and unpaid dividends thereon to the date of
payment thereof. After such payment shall have been made in full to the holders
of the Preferred Stock, the remaining assets and funds of the Corporation shall
be distributed among the holders of the stock of the Corporation ranking junior
to the Preferred Stock in respect of dividends or distribution of assets upon
liquidation according to their respective rights and preferences and in each
case according to their respective shares. In the event that the assets of the
Corporation available for distribution to holders of Preferred Stock shall not
be sufficient to make the payment herein required to be made in full, such
assets shall be distributed to the holders of the respective shares of Preferred
stock pro rata in proportion to the amounts payable upon such share thereof.
Neither the merger or consolidation of the Corporation into or with another
corporation nor the merger or consolidation of any other corporation into or
with the Corporation, shall be deemed to be a liquidation, dissolution or
winding up of the Corporation within the meaning of this Section 4, but the
sale, lease or conveyance of all or substantially all of its assets shall be
deemed to be a liquidation, dissolution or winding up of the Corporation within
the meaning of this Section 4.
(5) Status of Shares Redeemed or Retired. Preferred Stock redeemed or
otherwise retired by the Corporation shall, upon the filing of such statement as
may be required by law, assume the status of authorized but unissued Preferred
Stock and may thereafter be reissued in the same manner as other authorized but
unissued Preferred Stock.
(6) Amendments. Subject to such requirements as may be prescribed by
law or as may be expressly set forth in the foregoing provisions of this Article
VI or in any amendment to these Articles establishing and designating a series
of shares of Preferred Stock, any of the foregoing terms and provisions of this
Article VI may be altered, amended or repealed or the application thereof
suspended or waived in any particular case and changes in any of the
designations, preferences, limitations and relative rights of the Preferred
Stock may be made with the affirmative vote, at a meeting called for that
purpose, or the written consent with or without a meeting, of the holders of at
least two-thirds of the then issued and outstanding shares of Preferred Stock;
provided that neither the rate of dividend nor the amount payable upon the
redemption or in the event of voluntary or involuntary liquidation on any share
of Preferred Stock may be reduced without the consent of all of the holders
thereof.
Certain Business Combinations
Article VI.1. Vote Required for Certain Business Combinations
A. Higher Vote for Certain Business Combinations. In addition to any
affirmative vote required by law or these Articles of Incorporation, and except
as otherwise expressly provided in Section VI.2 of this Article VI:
(i) any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with (a) any Interested Stockholder (as hereinafter
defined) or (b) any other corporation (whether or not itself an Interested
Stockholder) which is, or after such merger or consolidation would be, an
Affiliate (as hereinafter defined) of any Interested Stockholder; or
(ii) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of transactions) to or with any
Interested Stockholder or any Affiliate of any Interested Stockholder of any
assets of the Corporation or any Subsidiary having an aggregate Fair Market
Value of $5,000,000 or more; or
(iii) the issuance or transfer by the Corporation or any Subsidiary (in
one transaction or a series of transactions) of any securities of the
Corporation or any Subsidiary to any Interested Stockholder or any Affiliate of
any Interested Stockholder in exchange for cash, securities or other property
(or a combination thereof) having an aggregate Fair Market Value of $5,000,000
or more; or
(iv) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation proposed by or on behalf of an Interested
Stockholder or any Affiliate of any Interested Stockholder; or
(v) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or consolidation
of the Corporation with any of its Subsidiaries or any other transaction
(whether or not with or into or otherwise involving an Interested Stockholder)
which has the effect, directly or indirectly, of increasing the proportionate
share of the outstanding shares of any class of equity or convertible securities
of the Corporation or any Subsidiary which is directly or indirectly owned by
any Interested Stockholder or any Affiliate of any Interested Stockholder; shall
require the affirmative vote of the holders of at least 80% of the voting power
of the then outstanding shares of capital stock of the Corporation entitled to
vote (the "Voting Stock"), voting together as a single class (it being
understood that for purpose of this Article VI, each share of the Voting Stock
shall have the number of votes granted to it pursuant to Article VI of these
Articles of Incorporation). Such affirmative vote shall be required,
notwithstanding the fact that no vote may be required, or that a lesser
percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise.
B. Definition of "Business Combination". The term "Business
Combination" as used in this Article VI shall mean any transaction which is
referred to in any one or more of clauses (i) through (v) of paragraph A of this
Section VI.1.
Article VI.2. When Higher Vote is Not Required
The provisions of Section VI.1 of this Article VI shall not be applicable
to any particular Business Combination, and such Business Combination shall
require only such affirmative vote as is required by law and any other provision
of these Articles of Incorporation, if all of the conditions specified in either
of the following paragraphs A and B are met:
A. Approval by Disinterested Directors. The Business Combination shall
have been approved by a majority of the Disinterested Directors (as hereinafter
defined).
B. Price and Procedure Requirements. All of the following conditions
shall have been met:
(i) the aggregate amount of the cash and the Fair Market Value (as
hereinafter defined) as of the date of the consummation of the Business
Combination of consideration other than cash to be received per share by holders
of Common Stock in such Business Combination shall be at least equal to the
higher of the following:
(a) (if applicable) the highest per share price (including any
brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the
Interested Stockholder for any shares of Common Stock acquired by it (1) within
the two-year period immediately prior to the first public announcement of the
proposal of the Business Combination (the "Announcement Date") or (2) in the
transaction in which it became an Interested Stockholder, whichever is higher;
and
(b) the Fair Market Value per share of Common Stock on the Announcement
Date or on the date on which the Interested Stockholder became an Interested
Stockholder (such latter date is referred to in this Article VI as the
"Determination Date"), whichever is higher.
(ii) The aggregate amount of the cash and the Fair Market Value as of
the date of the consummation of the Business Combination of consideration other
than cash to be received per share by holders of shares of any other class of
outstanding Voting Stock shall be at least equal to the highest of the following
(it being intended that the requirements of this paragraph B(ii) shall be
required to be met with respect to every class of outstanding Voting Stock,
whether or not the Interested Stockholder has previously acquired any shares of
a particular class of Voting Stock):
(a) (if applicable) the highest per share price (including any
brokerage commissions, transfer taxes and soliciting dealers' fees) paid by the
Interested Stockholder for any shares of such class of Voting Stock acquired by
it (1) within the two-year period immediately prior to the Announcement Date or
(2) in the transaction in which it became an Interested Stockholder, whichever
is higher;
(b) (if applicable) the highest preferential amount per share to which
the holders of shares of such class of Voting Stock are entitled in the event of
any voluntary or involuntary liquidation, dissolution or winding up of the
Corporation; and
(c) the Fair Market Value per share of such class of Voting Stock on
the Announcement Date or on the Determination Date, whichever is higher.
(iii) The consideration to be received by holders of a particular class
of outstanding Voting Stock (including Common Stock) shall be in cash or in the
same form as the Interested Stockholder has previously paid for shares of such
class of Voting Stock. If the Interested Stockholder has paid for shares of any
class of Voting Stock with varying forms of consideration, the form of
consideration for such class of Voting Stock shall be either cash or the form
used to acquire the largest number of shares of such class of Voting Stock
previously acquired by it. The price determined in accordance with paragraphs
B(i) and B(ii) of this Section VI.2 shall be subject to appropriate adjustment
in the event of any stock dividend, stock split, combination of shares or
similar event.
(iv) After such Interested Stockholder has become an Interested
Stockholder and prior to the consummation of such Business Combination: (a)
except as approved by a majority of the Disinterested Directors, there shall
have been no failure to declare and pay at the regular date therefor any full
quarterly dividends (whether or not cumulative) on the outstanding Preferred
Stock; (b) there shall have been (1) no reduction in the annual rate of
dividends paid on the Common Stock (except as necessary to reflect any
subdivision of the Common Stock), except as approved by a majority of the
Disinterested Directors, and (2) an increase in such annual rate of dividends as
necessary to reflect any reclassification (including any reverse stock split),
recapitalization, reorganization or any similar transaction which has the effect
of reducing the number of outstanding shares of the Common Stock, unless the
failure so to increase such annual rate is approved by a majority of the
Disinterested Directors; and (c) such Interested Stockholder shall not have
become the beneficial owner of any additional shares of Voting Stock except as
part of the transaction which results in such Interested Stockholder becoming an
Interested Stockholder.
(v) After such Interested Stockholder has become an Interested
Stockholder, such Interested Stockholder shall not have received the benefit,
directly or indirectly (except proportionately as a stockholder), of any loans,
advances, guarantees, pledges or other financial assistance or any tax credits
or other tax advantages provided by the Corporation, whether in anticipation of
or in connection with such Business Combination or otherwise.
(vi) A proxy or information statement describing the proposed Business
Combination and complying with the requirements of the Securities Exchange Act
of 1934 and the rules and regulations thereunder (or any subsequent provisions
replacing such Act, rules or regulations) shall be mailed to stockholders of the
Corporation at least 30 days prior to the consummation of such Business
Combination (whether or not such proxy or information statement is required to
be mailed pursuant to such Act or subsequent provisions).
Article VI.3. Certain Definitions
For the purposes of this Article VI:
A. A "person" shall mean any individual, firm, corporation or other
entity.
B. "Interested Stockholder" shall mean any person (other than the
Corporation or any Subsidiary) who or which:
(i) is the beneficial owner, directly or indirectly, of more than 10%
of the voting power of the outstanding Voting Stock; or
(ii) is an Affiliate of the Corporation and at any time within the two-
year period immediately prior to the date in question was the beneficial owner,
directly, or indirectly, of 10% or more of the voting power of the then
outstanding Voting Stock; or
(iii) is an assignee of or has otherwise succeeded to any shares of
Voting Stock which were at any time within the two-year period immediately prior
to the date in question beneficially owned by any Interested Stockholder, if
such assignment or succession shall have occurred in the course of a transaction
or series of transactions not involving a public offering within the meaning of
the Securities Act of 1933.
C. A person shall be a "beneficial owner" of any Voting Stock:
(i) which such person or any of its Affiliates or Associates (as
hereinafter defined) beneficially owns, directly or indirectly; or
(ii) which such person or any of its Affiliates or Associates has (a)
the right to acquire (whether such right is exercisable immediately or only
after the passage of time), pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights, exchange rights,
warrants or options, or otherwise, or (b) the right to vote pursuant to any
agreement, arrangement or understanding; or
(iii) which are beneficially owned, directly or indirectly, by any
other person with which such person or any of its Affiliates or Associates has
any agreement, arrangement or understanding for the purpose of acquiring,
holding, voting or disposing of any shares of Voting Stock.
D. For the purposes of determining whether a person is an Interested
Stockholder pursuant to paragraph B of this Section VI.3, the number of shares
of Voting Stock deemed to be outstanding shall include shares deemed owned
through application of paragraph C of this Section VI.3 but shall not include
any other shares of Voting Stock which may be issuable pursuant to any
agreement, arrangement or understanding, or upon exercise of conversion rights,
warrants or options, or otherwise.
E. "Affiliate" or "Associates" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under
the Securities Exchange Act of 1934, as in effect on January 1, 1986.
F. "Subsidiary" means any corporation of which a majority of any class
of equity security is owned, directly or indirectly, by the Corporation;
provided, however, that for the purposes of the definition of Interested
Stockholder set forth in paragraph B of this Section VI.3, the term "Subsidiary"
shall mean only a corporation of which a majority of each class of equity
security is owned, directly or indirectly, by the Corporation.
G. "Disinterested Director" means any member of the Board of Directors
of the Corporation (the "Board") who is unaffiliated with the Interested
Stockholder and was a member of the Board prior to the time that the Interested
Stockholder became an Interested Stockholder, and any successor of a
Disinterested Director who is unaffiliated with the Interested Stockholder and
is recommended to succeed a Disinterested Director by a majority of
Disinterested Directors then on the Board; provided, however, that all directors
of the Corporation who are elected as directors at the 1986 annual meeting of
shareholders of the Corporation shall be deemed to be Disinterested Directors,
notwithstanding the above provisions.
H. "Fair Market Value" means: (i) in the case of stock, the highest
closing sale price during the 30-day period immediately preceding the date in
question of a share of such stock on the Composite Tape for New York Stock
Exchange-Listed Stocks, or, if such stock is not quoted on the Composite Tape,
on the New York Stock Exchange, or, if such stock is not listed on such
Exchange, or the principal United States securities exchange registered under
the Securities Exchange Act of 1934 on which such stock is listed, or, if such
stock is not listed on any such exchange, the highest closing bid quotation with
respect to a share of such stock during the 30-day period preceding the date in
question on the National Association of Securities Dealers, Inc. Automated
Quotations System ("NASDAQ") or any system then in use, or if not listed with
NASDAQ, the average bid and ask prices available from brokerage firms in
Charleston, West Virginia, or if such information is not available, the fair
market value on the date in question of a share of such stock as determined by
the Board in good faith; and (ii) in the case of property other than cash or
stock, the fair market value of such property on the date in question as
determined by the Board in good faith.
I. In the event of any Business Combination in which the Corporation
survives, the phrase "other consideration to be received" as used in paragraphs
B(i) and (ii) of Section VI.2 of this Article VI shall include the shares of
Common Stock and/or the shares of any other class of outstanding Voting Stock
retained by the holders of such shares.
Article VI.4. Powers of the Board of Directors
A majority of the directors of the Corporation shall have the power and
duty to determine for the purposes of this Article VI, on the basis of
information known to them after reasonable inquiry, (A) whether a person is an
Interested Stockholder, (B) the number of shares of Voting Stock beneficially
owned by any person, (C) whether a person is an Affiliate or Associate of
another, (D) whether the assets which are the subject of any Business
Combination have, or the consideration to be received for the issuance or
transfer of securities by the Corporation or any Subsidiary in any Business
Combination has, an aggregate Fair Market Value of $5,000,000 or more. A
majority of the directors of the Corporation shall have the further power to
interpret all of the terms and provisions of this Article VI.
Article VI.5. No Effect on Fiduciary Obligations of Interested Stockholders
Nothing contained in this Article VI shall be construed to relieve any
Interested Stockholder from any fiduciary obligation imposed by law.
ArticleVI.6. Amendment, Repeal, etc.
Notwithstanding any other provisions of these Articles of Incorporation or
the Bylaws of the Corporation (and notwithstanding the fact that a lesser
percentage may be specified by law, these Articles of Incorporation or the
Bylaws of the Corporation), the affirmative vote of the holders of 80% or more
of the outstanding Voting Stock entitled to vote, voting together as a single
class, shall be required to amend or repeal, or adopt any provisions
inconsistent with this Article VI.
ARTICLE VII
The full name and address of the incorporator is:
NAME ADDRESS
Robert F. Baronner One Valley Square
Charleston, West Virginia 25326
ARTICLE VIII
The existence of this corporation is to be perpetual.
ARTICLE IX
The full name and address of the appointed person to whom notice or process
may be sent is: President, One Valley Bancorp, Inc., One Valley Square,
Charleston, West Virginia 25326.
ARTICLE X
The number of directors constituting the initial board of directors of the
corporation is twenty-one (21) and the names and addresses of the persons who
shall serve as directors until the first annual meeting of shareholders or until
their successors are elected and shall qualify are:
NAME ADDRESS
Robert F. Baronner 1520 Stonehenge Road
Charleston, West Virginia 25314
Elmer A. Braun 1507 Dogwood Road
Charleston, West Virginia 25314
James F. Brown, III 1701 Edgewood Drive
Charleston, West Virginia 25302
NAME ADDRESS
James K. Brown 1820 Devondale Circle
Charleston, West Virginia 25314
John T. Chambers, M.D. 888 Chappell Road
Charleston, West Virginia 25314
Lyell B. Clay 1230 Staunton Road
Charleston, West Virginia 25314
Hugh A. Curry 1553 Bridge Road
Charleston, West Virginia 25314
Edward I. Goldsmith 1272 Louden Heights Road
Charleston, West Virginia 25314
Frank A. Hardy Route 5, Box 33
Lewisburg, West Virginia 24901
Eugene F. Imbrogno, Jr. 3 Dreamview Lane
Charleston, West Virginia 25314
Charles T. Jones 1502 Hampton Road
Charleston, West Virginia 25314
Virgil W. O'Dell 1108 Kanawha Bouldvard, East
Apartment 502
Charleston, West Virginia 25301
John L. D. Payne 1508 Connell Road
Charleston, West Virginia 25314
Angus E. Peyton 1401 Quincy Lane
Charleston, West Virginia 25314
Mary Price Ratrie Kanawha Salines
Malden, West Virginia 25306
Turner R. Ratrie, Jr. 1530 Bedford Road
Charleston, West Virginia 25314
James R. Thomas, II 820 Middle Road
Charleston, West Virginia 25314
C. Hyde Tucker 2029 Huber Road
Charleston, West Virginia 25314
Richard M. Venable, Jr. 925 Newton Road
Charleston, West Virginia 25314
NAME ADDRESS
John M. Wells, Sr. 888 Chester Road
Charleston, West Virginia 25302
Thomas D. Wilkerson 1015 Sand Hill Drive
St. Albans, West Virginia 25177
