SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement ( ) Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
FIRST CITIZENS BANCSHARES, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
(X) No fee required
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
FIRST CITIZENS BANCSHARES, INC.
Post Office Box 27131
Raleigh, North Carolina 27611-7131
------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
------------------------------------------
To Be Held April 26, 1999
NOTICE is hereby given that the Annual Meeting of Shareholders of First
Citizens BancShares, Inc. ("BancShares") will be held as follows:
Place: First Citizens Bank Data Center
100 East Tryon Road
Raleigh, North Carolina
Date: Monday, April 26, 1999
Time: 1:00 p.m.
The purposes of the meeting are:
1. To elect a 25-member Board of Directors, each member to hold office for
a term of one year or until his or her respective successor is duly
elected and qualified.
2. To ratify the appointment of KPMG LLP as BancShares' independent public
accountants for 1999.
3. To transact any other business that may properly come before the Annual
Meeting.
SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN PERSON.
HOWEVER, TO ENSURE THE PRESENCE OF A QUORUM, ALL SHAREHOLDERS, EVEN THOUGH THEY
PLAN TO ATTEND, ARE URGED TO COMPLETE, SIGN AND DATE THE ACCOMPANYING PROXY AND
RETURN IT PROMPTLY IN THE POSTAGE PREPAID ENVELOPE PROVIDED FOR THAT PURPOSE.
THE GIVING OF SUCH PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE IT AND VOTE IN
PERSON IF YOU ATTEND THE ANNUAL MEETING.
By Order of the Board of Directors
/s/ Alexander G. MacFadyen, Jr.
Alexander G. MacFadyen, Jr., Secretary
March 22, 1999
<PAGE>
FIRST CITIZENS BANCSHARES, INC.
Post Office Box 27131
Raleigh, North Carolina 27611-7131
----------------------
PROXY STATEMENT
----------------------
Annual Meeting of Shareholders
To Be Held April 26, 1999
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of First Citizens BancShares, Inc.
("BancShares") for use at the Annual Meeting of Shareholders of BancShares to
be held at the First Citizens Bank Data Center, 100 East Tryon Road, Raleigh,
North Carolina, at 1 o'clock p.m. on April 26, 1999, or any adjournments
thereof. In addition to solicitation by mail, proxies may be solicited
personally or by telephone by directors, officers or employees of BancShares
and its subsidiary, First-Citizens Bank & Trust Company (the "Bank"). Expenses
of such proxy solicitation will be paid by BancShares. Persons named in the
proxy to represent shareholders at the meeting are: George H. Broadrick, Lewis
R. Holding, Frank B. Holding, James B. Hyler, Jr., Frank B. Holding, Jr.,
Carmen P. Holding, Lewis T. Nunnelee II, and David L. Ward, Jr. This Proxy
Statement is first being mailed to shareholders on or about March 22, 1999.
A proxy form that is properly executed and returned, and not revoked, will
be voted in accordance with the instructions contained in the proxy. If no
instructions are given, the proxy will be voted FOR the slate of 25 nominees
named herein for election to the Board of Directors and FOR ratification of the
appointment of KPMG LLP as BancShares' independent public accountants for 1999.
On such other matters as may properly come before the Annual Meeting, the proxy
will be voted in accordance with the best judgment of the persons named in the
proxy to represent the shareholders. If any nominee is unable or unwilling to
serve as a director for any reason, the proxy may be voted for a person
designated by the Board of Directors to replace such nominee. A shareholder who
executes a proxy has the right to revoke it at any time before it is voted by
filing with the Secretary of BancShares either an instrument revoking the proxy
or a duly executed proxy bearing a later date, or by attending the Annual
Meeting and requesting the right to vote in person.
RECORD DATE; VOTING SECURITIES; VOTE REQUIRED FOR APPROVAL
March 8, 1999, is the record date for the determination of shareholders
entitled to notice of and to vote at the Annual Meeting. At the Annual Meeting,
shareholders will be entitled to cast the number of votes to which they are
entitled based on the shares of BancShares' voting securities standing of
record in their respective names at the close of business on that date.
As of March 8, 1999, BancShares' voting securities consisted of 8,900,114
shares of Class A Common Stock, $1 par value per share, each share being
entitled to one vote on each matter submitted for voting and on each director
to be elected, and 1,720,460 shares of Class B Common Stock, $1 par value per
share, each share being entitled to 16 votes on each matter submitted for
voting and on each director to be elected.
In the election of directors, the 25 nominees receiving a plurality of the
votes represented at the Annual Meeting in person or by proxy and entitled to
vote on Proposal 1 shall be elected. In the voting on Proposal 2, the
affirmative vote of a majority of the votes represented at the Annual Meeting
in person or by proxy and entitled to vote is required for approval. In the
voting on Proposal 2, abstentions will have the same effect as votes against
the proposal, but broker non-votes will have no effect.
<PAGE>
PRINCIPAL HOLDERS OF VOTING SECURITIES
As of March 8, 1999, the shareholders identified in the following table
beneficially owned more than 5% of one or both classes of BancShares' voting
securities:
<TABLE>
<CAPTION>
Beneficial Ownership*
------------------------------------- Combined
Class A and
Class A Common Class B Common Class B Common
Name and Address and Percentage and Percentage Percentage of
of Beneficial Owner of Class of Class Total Votes**
- - ------------------------------- ------------------ ---------------- ---------------
<S> <C> <C> <C>
Carson H. Brice 51,408(1) 100,885(1) 4.57%
Raleigh, NC ( .58%) ( 5.86%)
Claire H. Bristow 51,345(2) 100,812(2) 4.57%
Columbia, SC ( .58%) ( 5.86%)
George H. Broadrick 441,852(3) 530,672(3) 24.52%
Charlotte, NC ( 4.96%) (30.84%)
Hope H. Connell 58,614(4) 111,097(4) 5.04%
Raleigh, NC ( .66%) ( 6.46%)
Frank B. Holding 2,515,136(5) 638,828(5) 34.96%
Smithfield, NC (28.26%) (37.13%)
Frank B. Holding, Jr. 57,620(6) 118,050(6) 5.34%
Raleigh, NC ( .65%) ( 6.86%)
Lewis R. Holding 1,512,949(7) 161,443(7) 11.24%
Lyford Cay, Bahamas (17.00%) ( 9.38%)
Olivia B. Holding 48,981(8) 104,015(8) 4.70%
Raleigh, NC ( .55%) ( 6.05%)
</TABLE>
- - ---------
* Except as otherwise stated in the footnotes following this table, shares
shown as beneficially owned, to the best of BancShares' management's
knowledge, are owned individually by the persons named and such persons
exercise sole voting and investment power with respect to those shares.
** This column reflects the aggregate votes attributable to the combined shares
of Class A and Class B beneficially owned by each principal shareholder
listed above, as a percentage of the aggregate votes that may be cast by the
holders of all shares of BancShares' outstanding voting securities.
(1) Includes 5,200 shares of Class A and 1,250 shares of Class B held in trust
for Mrs. Brice's benefit, as to which she exercises shared voting and
investment power. All shares included in Mrs. Brice's beneficial ownership
also are shown as beneficially owned by her father, Frank B. Holding.
(2) Includes 550 shares of Class A and 16,000 shares of Class B held by Mrs.
Bristow's spouse as custodian for their children, as to which shares she
disclaims beneficial ownership. Also includes 5,200 shares of Class A and
1,250 shares of Class B held in trust for her benefit, as to which shares
she exercises shared voting and investment power. All shares included in
Mrs. Bristow's beneficial ownership also are shown as beneficially owned
by her father, Frank B. Holding.
(3) Includes an aggregate of 256,375 shares of Class A and 497,472 shares of
Class B held by various trusts of which Mr. Broadrick serves as trustee
with sole voting and investment power. Also includes an aggregate of
122,800 shares of Class A and 30,700 shares of Class B held in trust for
the benefit of Carmen P. Holding by Mr. Broadrick and Carolyn S. Holding
as co-trustees with shared voting and investment power, which shares also
are shown as beneficially owned by Lewis R. Holding, and also by Carmen P.
Holding (see "OWNERSHIP OF SECURITIES BY MANAGEMENT"). Also includes
10,000 shares of Class A and 2,500 shares of Class B owned by Mr.
Broadrick's spouse, as to which shares he disclaims beneficial ownership.
(4)Includes an aggregate of 2,000 shares of Class A and 11,250 shares of Class B
held by Mrs. Connell's spouse, individually or as custodian for their
children, as to which shares she disclaims beneficial ownership. Also
includes 5,100 shares of Class A and 1,225 shares of Class B held in trust
for her benefit, as to which shares she exercises shared voting power.
Also includes an aggregate of 18,845 shares of Class A and 1,900 shares of
Class B held by certain corporations which, for beneficial ownership
purposes, may be deemed to be controlled by Mrs. Connell, as to which
shares she may be deemed to exercise shared voting and investment power.
Of the shares shown as beneficially owned by Mrs. Connell, an aggregate of
39,769 shares of Class A and 109,197 shares of Class B also are shown as
beneficially owned by her father, Frank B. Holding, and an aggregate of
18,845 shares of Class A and 1,900 shares of Class B also are shown as
beneficially owned by her uncle, Lewis R. Holding.
(5) Includes an aggregate of 534,778 shares of Class A and 105,869 shares of
Class B held by certain corporations and other entities which, for
beneficial ownership purposes, Mr. Holding may be deemed to control, as to
which shares he may be deemed to exercise shared voting and investment
power. Also includes an aggregate of 352,524 shares of Class A and 532,959
shares of Class B held by or in trust for Mr. Holding's spouse, adult
children and their spouses, as to which shares he disclaims beneficial
ownership. Included in Mr. Holding's beneficial ownership are an aggregate
of 499,530 shares of Class A and 104,644 shares of Class B also shown as
beneficially owned by his brother, Lewis R. Holding; and an aggregate
2
<PAGE>
of 249,123 shares of Class A and 532,959 shares of Class B also shown as
beneficially owned by Mr. Holding's adult children, each of whom is listed
individually in the table above.
(6) Includes 8,725 shares of Class A and 19,120 shares of Class B held by Mr.
Holding as custodian for his minor children, as to which shares he
exercises sole voting and investment power. Also includes 5,100 shares of
Class A and 1,225 shares of Class B held in trust for his benefit, as to
which shares he exercises shared voting and investment power. Also
includes 3,700 shares of Class A and 650 shares of Class B held by his
spouse, as to which shares Mr. Holding disclaims beneficial ownership. All
shares included in Mr. Holding's beneficial ownership also are shown as
beneficially owned by his father, Frank B. Holding.
(7) Includes an aggregate of 518,375 shares of Class A and 106,544 shares of
Class B held by certain corporations and other entities which, for
beneficial ownership purposes, Mr. Holding may be deemed to control, as to
which shares he may be deemed to exercise shared voting and investment
power. Also includes 48,963 shares of Class A and 12,025 shares of Class B
held by his spouse individually, an aggregate of 122,800 shares of Class A
and 30,700 shares of Class B held by his spouse and George H. Broadrick as
co-trustees of certain trusts for the benefit of his daughter, Carmen P.
Holding, and 25,129 shares of Class A and 581 shares of Class B held
directly by Ms. Holding, as to all of which shares he disclaims beneficial
ownership. Included in Mr. Holding's beneficial ownership are an aggregate
of 499,530 shares of Class A and 104,644 shares of Class B also shown as
beneficially owned by his brother, Frank B. Holding; an aggregate of
18,845 shares of Class A and 1,900 shares of Class B also shown as
beneficially owned by his niece, Hope H. Connell; an aggregate of 122,800
shares of Class A and 30,700 shares of Class B also shown as beneficially
owned by George H. Broadrick; and an aggregate of 147,929 shares of Class A
and 31,281 shares of Class B also shown as beneficially owned by his
daughter, Carmen P. Holding (see "OWNERSHIP OF SECURITIES BY MANAGEMENT").
(8) Includes 5,100 shares of Class A and 1,225 shares of Class B held in trust
for her benefit, as to which shares Ms. Holding exercises shared voting
and investment power. All shares included in Ms. Holding's beneficial
ownership also are shown as beneficially owned by her father, Frank B.
Holding.
3
<PAGE>
OWNERSHIP OF SECURITIES BY MANAGEMENT
As of March 8, 1999, the beneficial ownership of BancShares' voting
securities by directors, certain named executive officers, and by all directors
and executive officers as a group, of BancShares and the Bank was as follows:
<TABLE>
<CAPTION>
Beneficial Ownership*
----------------------------------------- Combined
Class A and
Class A Common Class B Common Class B Common
Name and Address and Percentage and Percentage Percentage of
of Beneficial Owner of Class of Class Total Votes**
- - -------------------------------- -------------------- ------------------ ---------------
<S> <C> <C> <C>
John M. Alexander, Jr. 1,434(1) 225(1) .01%
Raleigh, NC ( .02%) ( .01%)
Ted L. Bissett 7,265(2) 1,375(2) .08%
Spring Hope, NC ( .08%) ( .08%)
B. Irvin Boyle 700 175 .01%
Charlotte, NC ( .01%) ( .01%)
George H. Broadrick 441,852(3) 530,672(3) 24.52%
Charlotte, NC ( 4.96%) (30.84%)
Hubert M. Craig III 12,099(4) 3,550(4) .19%
Gastonia, NC ( .14%) ( .21%)
Betty M. Farnsworth 1,561(5) 250 .02%
Pilot Mountain, NC ( .02%) ( .01%)
Lewis M. Fetterman 12,955(6) 2,750(6) .16%
Clinton, NC ( .15%) ( .16%)
Carmen P. Holding 147,929(7) 31,281(7) 1.78%
Atlanta, GA ( 1.66%) ( 1.82%)
Frank B. Holding 2,515,136(8) 638,828(8) 34.96%
Smithfield, NC (28.26%) (37.13%)
Frank B. Holding, Jr. 57,620(9) 118,050(9) 5.34%
Raleigh, NC ( .65%) ( 6.86%)
Lewis R. Holding 1,512,949(10) 161,443(10) 11.24%
Lyford Cay, Bahamas (17.00%) ( 9.38%)
Charles B. C. Holt 2,570(11) -0- .01%
Fayetteville, NC ( .03%)
Edwin A. Hubbard 11,948(12) -0- .03%
Sanford, NC ( .13%)
James B. Hyler, Jr. 5,366 100 .02%
Raleigh, NC ( .06%) ( .01%)
Gale D. Johnson 481 50 .01%
Dunn, NC ( .01%) ( .01%)
Freeman R. Jones 4,000 250 .02%
Midland, NC ( .04%) ( .01%)
Lucius S. Jones 1,000 -0- .01%
Wendell, NC ( .01%)
Joseph T. Maloney, Jr. 22,452 5,400 .30%
Fayetteville, NC ( .25%) ( .31%)
J. Claude Mayo, Jr. 1,100(13) -0- .01%
Rocky Mount, NC ( .01%)
William McKay 1,072(14) -0- .01%
Flat Rock, NC ( .01%)
Brent D. Nash 11,009(15) -0- .03%
Tarboro, NC ( .12%)
Lewis T. Nunnelee II 600 450 .04%
Wilmington, NC ( .01%) ( .03%)
James M. Parker 842(16) -0- .01%
Raleigh, NC ( .01%)
Talbert O. Shaw 119 -0- .01%
Raleigh, NC ( .01%)
R. C. Soles, Jr. 15,138 -0- .04%
Tabor City, NC ( .17%)
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Beneficial Ownership*
------------------------------------------- Combined
Class A and
Class A Common Class B Common Class B Common
Name and Address and Percentage and Percentage Percentage of
of Beneficial Owner of Class of Class Total Votes**
- - ------------------------------- -------------------- -------------------- ------------------
<S> <C> <C> <C>
David L. Ward, Jr. 24,100(17) 8,388(17) .43%
New Bern, NC ( .27%) ( .49%)
All directors and 3,992,931(18) 1,218,712(18) 64.49%(18)
executive officers as (44.86%) (70.84%)
a group (36 persons)
</TABLE>
- - ---------
* Except as otherwise stated in the footnotes following this table, shares
shown as beneficially owned, to the best of BancShares' management's
knowledge, are owned individually by the persons named and such persons
exercise sole voting and investment power with respect to those shares.
** This column reflects the aggregate votes attributable to the combined shares
of Class A and Class B beneficially owned by each director and executive
officer, and by the group, as a percentage of the aggregate votes that may
be cast by the holders of all shares of BancShares' outstanding voting
securities.
(1) Includes 900 shares of Class A and 225 shares of Class B held by a
corporation which, for beneficial ownership purposes, Mr. Alexander may be
deemed to control, as to which shares he may be deemed to exercise shared
voting and investment power.
(2) Includes 1,684 shares of Class A and 300 shares of Class B held by Mr.
Bissett's children, as to which shares he exercises shared voting and
investment power.
(3) For an explanation of the nature of the beneficial ownership of George H.
Broadrick, see footnote (3) of "PRINCIPAL HOLDERS OF VOTING SECURITIES."
(4) Includes 699 shares of Class A and 400 shares of Class B held by Mr. Craig
as executor of his father's estate. Also includes 11,300 shares of Class A
and 3,150 shares of Class B held by a corporation which, for beneficial
ownership purposes, Mr. Craig may be deemed to control, as to which shares
he may be deemed to exercise shared voting and investment power.
(5) Includes 100 shares of Class A held by an adult son, as to which shares
Mrs. Farnsworth disclaims beneficial ownership.
(6) Includes 2,809 shares of Class A and 550 shares of Class B held in trust
for Mr. Fetterman's spouse, as to which shares he disclaims beneficial
ownership.
(7) Includes an aggregate of 122,800 shares of Class A and 30,700 shares of
Class B held in trust for Ms. Holding's benefit, as to which shares she
exercises shared voting and investment power, which shares also are shown
as beneficially owned by George H. Broadrick and Lewis R. Holding.
(8) For an explanation of the nature of the beneficial ownership of Frank B.
Holding, see footnote (5) of "PRINCIPAL HOLDERS OF VOTING SECURITIES."
(9) For an explanation of the nature of the beneficial ownership of Frank B.
Holding, Jr., see footnote (6) of "PRINCIPAL HOLDERS OF VOTING
SECURITIES."
(10) For an explanation of the nature of the beneficial ownership of Lewis R.
Holding, see footnote (7) of "PRINCIPAL HOLDERS OF VOTING SECURITIES."
(11) Includes 139 shares of Class A held by Mr. Holt as trustee of a retirement
plan, as to which shares he may be deemed to exercise shared voting and
investment power. Also includes 465 shares of Class A held by his spouse,
as to which shares he disclaims beneficial ownership.
(12) Includes 5,012 shares of Class A held by Mr. Hubbard's spouse, as to which
shares he disclaims beneficial ownership.
(13) Includes 100 shares of Class A held by Mr. Mayo's spouse, as to which
shares he disclaims beneficial ownership.
(14) Includes 187 shares of Class A held jointly by Mr. McKay with his spouse,
as to which shares he exercises shared voting and investment power.
(15) Includes 5,577 shares of Class A held by Mr. Nash's spouse, as to which
shares he disclaims beneficial ownership.
(16) Includes 259 shares of Class A held jointly by Mr. Parker with his spouse,
as to which shares he exercises shared voting and investment power.
(17) Includes 3,500 shares of Class A and 875 shares of Class B held by Mr.
Ward's spouse, as to which shares he disclaims beneficial ownership.
(18) Certain numbers of shares included in the beneficial ownership of George H.
Broadrick, Carmen P. Holding, Frank B. Holding, Frank B. Holding, Jr.,
and Lewis R. Holding are reflected separately in the beneficial ownership
of each of such individuals, but are included only once in the beneficial
ownership shown for the group.
5
<PAGE>
Section 16(a) Beneficial Ownership Reporting Compliance
BancShares' directors and executive officers are required to file certain
reports with the Securities and Exchange Commission regarding the amount of and
changes in their beneficial ownership of BancShares' Class A and Class B common
stock. Based on its review of copies of those reports, BancShares' proxy
materials are required to disclose failures to report shares beneficially owned
or changes in such beneficial ownership, or to timely file required reports,
during the previous fiscal year. To the best knowledge of BancShares'
management, there were no such failures to file required reports during 1998.
PROPOSAL 1: ELECTION OF DIRECTORS
BancShares' Bylaws provide for not less than five nor more than 30
directors. Within those limits, the Board of Directors has the authority to
establish the number of directors to be elected each year and has set the
number of directors at 25 for election at the Annual Meeting. The 25 nominees
receiving the highest numbers of votes will be deemed to have been elected.
The persons named below have been nominated by the Board of Directors for
election as directors of BancShares. Each nominee currently serves as a
director of BancShares and has been nominated to be reelected for a term of one
year or until resignation, retirement, death, or until his or her respective
successor has been duly elected and qualified:
<TABLE>
<CAPTION>
Positions with Year
BancShares First Principal Occupation and Business
Name and Age and Bank Elected(1) Experience for Past Five Years
- - ------------------------------ ------------------------ ------------ --------------------------------------------------
<S> <C> <C> <C>
John M. Alexander, Jr. (2) Director 1990 President, General Manager and Chief
49 Operating Officer, Cardinal International Trucks,
Inc. (truck dealer)
Ted L. Bissett Director 1970 President, F.D. Bissett & Son, Inc. (farm
62 supplies, hardware and building materials)
B. Irvin Boyle Director 1980 Attorney; of counsel to Johnston, Allison & Hord,
87 P.A. (attorneys)
George H. Broadrick (2) Director; Chairman 1975 Retired President and consultant, First-Citizens
76 of Executive Committee; Bank & Trust Company and First Citizens
Consultant BancShares, Inc.
Hubert M. Craig III Director 1998 Vice President-North American Sales and
42 Director, Gaston County Dyeing Machine
Company (textile machinery manufacturer)
Betty M. Farnsworth Director 1985 Homemaker
72
Lewis M. Fetterman Director 1980 Chairman and CEO, Super Soil Systems USA,
77 Inc.; President and Owner, LMF Farms and
LMF Consulting & Marketing Co.; Assistant to
President, Heartland Pork Enterprises, Inc.;
Director, Lundy Packing Co. (agribusiness)
Carmen P. Holding (2)(3) Director 1996 Assistant, Susan B. Bozeman Designs, Inc.
30 (residential interior design); former office
manager, Interweb, Inc. (website developer);
previously, showroom salesperson, Scalamandre,
Inc. (decorative fabrics manufacturing
wholesaler)
Frank B. Holding (2)(3) Executive Vice 1962 Executive Vice Chairman of the Board, First-
70 Chairman of Citizens Bank & Trust Company and First
the Board Citizens BancShares, Inc.; Vice Chairman of the
Board, First-Citizens Bank and Trust Company
of South Carolina and First Citizens
Bancorporation of South Carolina, Inc.
Frank B. Holding, Jr. (2)(3) President and 1993 President, First Citizens BancShares, Inc. and
37 Director First-Citizens Bank & Trust Company; Director,
Exchange Bank of South Carolina, Kingstree,
South Carolina
Lewis R. Holding (3) Chairman of 1957 Chairman of the Board and Chief Executive
71 the Board Officer, First Citizens BancShares, Inc. and
First-Citizens Bank & Trust Company
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
Positions with Year
BancShares First Principal Occupation and Business
Name and Age and Bank Elected(1) Experience for Past Five Years
- - ------------------------ -------------------- ------------ -------------------------------------------------
<S> <C> <C> <C>
Charles B. C. Holt Director 1995 Secretary/Treasurer (former President), Holt Oil
66 Company, Inc. (wholesale petroleum marketer);
former Chairman of the Board, State Bank,
Fayetteville, NC
Edwin A. Hubbard Director 1996 Retired; former Owner and Chairman of the
80 Board, Stroud-Hubbard Company, Inc. (retail
shoe company); former Chairman, Allied Bank
Capital, Inc. and Summit Savings Bank, Inc.,
SSB, Sanford, NC
James B. Hyler, Jr. Vice Chairman of 1988 Vice Chairman of the Board and Chief Operating
51 the Board Officer, First Citizens BancShares, Inc. and
First-Citizens Bank & Trust Company
Gale D. Johnson, M.D. Director 1974 Retired Surgeon; Director of Health Affairs,
79 Campbell University
Freeman R. Jones Director; Chairman 1974 Retired; President, EFC Corporation (real estate
72 of Salary Committee investment)
Lucius S. Jones Director 1994 President, Chief Executive Officer and Owner,
56 United Realty & Construction Company, Inc.
(residential development and construction)
Joseph T. Maloney, Jr. Director 1976 Retired; private investor
69
J. Claude Mayo, Jr. Director 1994 Retired; former principal, Mayo, Simmons &
71 Harris, Inc. (insurance)
William McKay Director 1991 Retired; former President and CEO, First
73 Federal Savings Bank, Hendersonville, NC
Brent D. Nash Director 1995 Senior Vice President, First-Citizens Bank &
63 Trust Company; former President and CEO,
Edgecombe Homestead Savings Bank, Inc., SSB,
Tarboro, NC
Lewis T. Nunnelee II Director 1979 Chairman of the Board, Coastal Beverage
73 Company, Inc. (wholesale beer distributor)
Talbert O. Shaw, Ph.D. Director 1993 President, Shaw University (educator)
71
R. C. Soles, Jr. Director 1995 Attorney and Senior Partner, Soles, Phipps, Ray,
64 Prince & Williford (attorneys); Senator, North
Carolina Senate; former Chairman of the Board,
First Investors Savings Bank, Inc., SSB,
Whiteville, NC
David L. Ward, Jr. (4) Director; Chairman 1971 Senior Attorney and President, Ward and Smith,
63 of Audit Committee P.A. (attorneys)
</TABLE>
- - ---------
(1) The term "Year First Elected" refers to the year in which a director first
took office as a director of BancShares or its predecessor, First Citizens
Corporation, or, if elected prior to the formation of First Citizens
Corporation in 1982, of the Bank.
(2) Certain directors of BancShares also serve as directors of other publicly
held companies, as follows: John M. Alexander, Jr. serves as a director of
North Carolina Railroad Company, Raleigh, N.C.; George H. Broadrick,
Carmen P. Holding, and Frank B. Holding serve as directors of First
Citizens Bancorporation of South Carolina, Inc., Columbia, S.C.; Frank B.
Holding serves as a director of Southern BancShares (N.C.), Inc., Mount
Olive, N.C.; and Frank B. Holding, Jr. serves as a director of North
Carolina Natural Gas Corporation, Fayetteville, N.C.
(3) Lewis R. Holding and Frank B. Holding are brothers. Carmen P. Holding is
the daughter of Lewis R. Holding and the niece of Frank B. Holding. Frank B.
Holding, Jr. is the son of Frank B. Holding and the nephew of Lewis R.
Holding. Frank B. Holding, Jr. and Carmen P. Holding are first cousins.
(4) The law firm of Ward and Smith, P.A., New Bern, N.C., of which David L.
Ward, Jr. is Senior Attorney and President, served as General Counsel for
BancShares and the Bank during 1998, which relationship is expected to
continue through 1999. BancShares and the Bank paid $3,275,139 in legal
fees to Ward and Smith, P.A. during 1998.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE THEIR SHARES IN
FAVOR OF EACH OF THE 25 NOMINEES LISTED ABOVE FOR ELECTION TO THE BOARD OF
DIRECTORS.
7
<PAGE>
Directors' Fees and Compensation
For their services as directors, each member of the Board of Directors
(except Messrs. L. Holding, F. Holding, J. Hyler, F. Holding, Jr. and E.
Hubbard) receives an annual retainer of $10,000, plus $500 for attendance at
each meeting of the Board and $500 for attendance at each meeting of a
committee that is held on a day other than in conjunction with a meeting of the
Board.
In addition to, or in lieu of, such director's fees, certain directors of
BancShares receive other compensation from BancShares or the Bank, as follows:
William McKay receives compensation in addition to the regular director's
fees described above pursuant to various arrangements related to the Bank's
1991 acquisition of First Federal Savings Bank, Hendersonville, N.C. ("First
Federal"), of which Mr. McKay served as a director and President. At the time
of the acquisition, Mr. McKay, as well as certain other directors of First
Federal, was a party to two agreements entered into during 1985 and 1987 with
First Federal, which provided for retirement benefits. Pursuant to the 1985
agreement, Mr. McKay deferred $300 per month of his directors' fees paid by
First Federal for a period of five years and became entitled to a monthly
retirement benefit of $1,249 for ten years, ending during 2000. Pursuant to the
1987 agreement, Mr. McKay began receiving a monthly retirement benefit of $835
during August 1992, which benefits will continue until 2002. The Bank assumed
First Federal's obligations for these payments as part of the acquisition.
Brent D. Nash receives compensation in addition to the regular director's
fees described above pursuant to various arrangements related to the 1994
merger of Edgecombe Homestead Savings Bank, Inc., SSB, Tarboro, N.C.
("Edgecombe") into the Bank. The merger was effected pursuant to an agreement
providing that Mr. Nash, the former President, Chief Executive Officer and a
director of Edgecombe, would be appointed to the Board of Directors of
BancShares. Pursuant to that agreement, as of the effective date of the merger
the Bank and Mr. Nash also entered into an employment agreement providing for
his employment as a Senior Vice President in the Bank's Tarboro office. The
employment agreement also includes various noncompetition and nonsolicitation
covenants by Mr. Nash, provides for salary and normal employee benefits, and
has a term continuing to January 12, 2001, when Mr. Nash will reach age 65.
Following that date, Mr. Nash will begin receiving retirement benefits pursuant
to the Bank's Pension Plan. In addition, he will receive retirement payments
pursuant to an agreement with Edgecombe, whereby he deferred his director's
fees of $300 per month for five years in return for payments of $1,300 per
month for ten years after age 65. The Bank assumed Edgecombe's responsibilities
for such retirement payments as part of the merger.
R. C. Soles, Jr. became a director of BancShares and the Bank in
connection with the 1995 merger of First Investors Savings Bank, Inc., SSB,
Whiteville, N.C. ("First Investors") into the Bank. Mr. Soles served as
Chairman of First Investors prior to the merger. The written agreement
pertaining to the merger provided that Mr. Soles would be appointed to the
Board of Directors of BancShares and that the former directors of First
Investors, including Mr. Soles, would become local advisory directors for the
Bank and receive for such services a fee of $835 per quarter until February 23,
2000. Mr. Soles receives such fees in addition to the normal director's fees
described above.
Charles B. C. Holt became a director of BancShares and the Bank when State
Bank, Fayetteville, N.C. ("State Bank") merged into the Bank in 1995. Mr. Holt
served as Chairman of State Bank prior to the merger. The written agreement
pertaining to the merger provided that Mr. Holt would be appointed to the Board
of Directors of BancShares and that the former directors of State Bank,
including Mr. Holt, would become local advisory directors for the Bank and
receive for such services a monthly fee of $250 until March 2, 1998. Until that
date, Mr. Holt received such fees for serving as a local advisory director in
addition to the normal director's fees described above.
Edwin A. Hubbard receives special compensation, in lieu of the standard
BancShares' director's fees described above, pursuant to an arrangement related
to BancShares' February 14, 1996, acquisition of Allied Bank Capital, Inc.,
Sanford, N.C. ("Allied"), of which Mr. Hubbard served as Chairman. Pursuant to
the Allied acquisition agreement, Mr. Hubbard was selected by BancShares to
serve as a member of the Boards of Directors of BancShares and the Bank and
receives a monthly fee of $3,250 (which is equal to the directors' fees
previously paid by Allied) until the end of his fourth elected term as a
director of BancShares. Also, Mr. Hubbard (as well as certain other directors
of Allied) was a participant in Allied's Independent Directors' Retirement
Plan, which provides for monthly retirement benefits. Pursuant to the Plan,
Mr. Hubbard will receive $1,200 per month for a period of ten years following
BancShares' acquisition of Allied. The Bank assumed Allied's obligations for
these retirement payments as part of the merger.
George H. Broadrick, since his retirement as President of the Bank in
1987, has received additional compensation of $50 per hour, plus expenses, for
services rendered pursuant to a consulting agreement with the Bank. In
addition, Mr. Broadrick receives benefits under the Bank's Pension Plan and
payments of $4,778 per month until June 2006 pursuant
8
<PAGE>
to a separate agreement with the Bank under which he has agreed to provide the
Bank with certain consultation services and will not "compete" (as defined in
the agreement) with the Bank during the period he is receiving such payments.
Betty M. Farnsworth, Charles B. C. Holt, Lucius S. Jones, Joseph T.
Maloney, Jr., J. Claude Mayo, Jr., and Lewis T. Nunnelee II, also serve on the
local advisory boards of the Bank in their respective communities, and each
receives quarterly fees of $125 for attendance at advisory board meetings in
addition to the fees described above for their services as members of the
Boards of Directors of BancShares and the Bank.
Meetings and Committees of the Board of Directors
The Board of Directors of BancShares held four meetings in 1998. All
directors attended at least 75% of the aggregate number of meetings of
BancShares' Board of Directors and any committees on which they served during
their terms, except Dr. Shaw and Mr. Alexander, whose absences were due to
illness and other business commitments.
BancShares' Board of Directors and the Bank's Board of Directors have the
same members. The Boards of Directors have several standing committees,
including a Salary Committee and an Audit Committee. BancShares' Board of
Directors does not have a standing nominating committee or any other committee
performing an equivalent function.
The Audit Committee of BancShares and the Bank consists of David L. Ward,
Jr. -- Chairman, John M. Alexander, Jr., Betty M. Farnsworth, Charles B. C.
Holt, Edwin A. Hubbard, and J. Claude Mayo, Jr. The Audit Committee oversees
the establishment of the scope and detail of the continuous audit program
conducted by the Bank's internal audit staff. The General Auditor of the Bank
reports directly to the Audit Committee and, at least quarterly, the Committee
reviews reports on the work of the internal audit staff, the Corporate Finance
Department, and the Commercial Credit Administration Department. Subject to the
approval of BancShares' Board of Directors and ratification by the
shareholders, the Committee engages a qualified firm of independent certified
public accountants to conduct an annual audit of BancShares' consolidated
financial statements and receives written reports from such firm and reviews
non-audit services proposed by management to be provided by the accounting
firm. During 1998, the Audit Committee held four meetings.
The members of the Salary Committee of the Bank's Board of Directors are
listed below. The Salary Committee provides overall guidance for the officer
compensation programs, including salaries and other forms of compensation. At
least annually, the Salary Committee reviews the officer compensation programs,
including salary, pension and such other employee benefit matters as it deems
appropriate. In conjunction with management, it makes recommendations to the
entire Board of Directors with regard to proposed salaries and other forms of
compensation, which recommendations are subject to approval by the Board.
During 1998, the Salary Committee held one meeting.
Compensation Committee Interlocks and Insider Participation
The current members of the Salary Committee are Freeman R. Jones --
Chairman, Lewis M. Fetterman, and Lewis T. Nunnelee II. After receipt of the
recommendations of the Salary Committee, the Board of Directors makes all final
decisions regarding executive compensation matters. Members of the Board of
Directors who are executive officers abstain from participation in both the
discussion of and the voting on such matters.
9
<PAGE>
Committee Report on Executive Compensation
The Bank's goal is to provide an executive compensation program that will
enable it to attract and retain qualified and motivated individuals as
executive officers. Currently, the Bank's executive compensation program
includes: (a) base salary, and (b) contributions to the individual accounts of
all participating employees (including executive officers) under the Bank's
Section 401(k) salary deferral plan. In addition, the Bank provides other
employee benefit and welfare plans customary for companies of its size.
Effective as of January 1998, the Salary Committee made recommendations to
the Board of Directors (and the Board of Directors made final decisions)
regarding the amounts of the 1998 salaries of Lewis R. Holding, Frank B.
Holding, James B. Hyler, Jr., and Frank B. Holding, Jr., and the maximum
aggregate amount for 1998 merit increases in the salaries of the Bank's other
officers and employees. With respect to Messrs. L. Holding, F. Holding, J.
Hyler, and F. Holding, Jr., the Committee's recommendations were based on its
evaluation of their individual levels of responsibility and performance and, in
the case of Mr. L. Holding in particular, his current leadership and direction
and his historical importance in the development and growth of both the Bank
and BancShares. With respect to the salaries of other executive officers, the
Vice Chairman, with the consent of the Chairman, was directed by the Board of
Directors to set 1998 salaries on an individual merit basis. In connection with
the Bank's normal annual performance review system, the performance of each
such other executive officer is graded by the person to whom that officer
reports. Based on the results of each individual officer's performance
appraisal, for 1998 the officer could be awarded an annual merit increase of up
to 6% of 1997 base salary. However, the performance review process and, thus,
the setting of salaries largely are subjective and, except as described above,
there are no specific formulae, objective criteria or other such mechanisms by
which adjustments to the salary of each executive officer (including Messrs. L.
Holding, F. Holding, J. Hyler and F. Holding, Jr.) are tied empirically to his
individual performance or to BancShares' financial performance. The amounts of
contributions to the separate accounts of executive officers under the Bank's
401(k) salary deferral plan were determined solely by the terms of that plan.
Section 162(m) of the Internal Revenue Code of 1986, as amended, limits
the deductibility of annual compensation in excess of $1,000,000 paid to
certain executive officers of public corporations. As none of BancShares'
executive officers receive annual compensation approaching that amount,
BancShares' Board of Directors has not yet adopted a policy with respect to
Section 162(m).
Salary Committee:
Freeman R. Jones, Chairman
Lewis M. Fetterman
Lewis T. Nunnelee II
10
<PAGE>
Executive Officers
The following individuals have been designated by the Boards of Directors
of BancShares and the Bank as "executive officers." All executive officers
serve at the pleasure of the Board of Directors and each has served for the
past five years in the capacities indicated, with the exceptions noted below:
<TABLE>
<CAPTION>
Name Age Position
- - ----------------------------- ----- ------------------------------------------------------------
<S> <C> <C>
Lewis R. Holding 71 Chairman of the Board of BancShares and Bank
(Chief Executive Officer)
Frank B. Holding 70 Executive Vice Chairman of the Board of BancShares and
Bank
James B. Hyler, Jr. 51 Vice Chairman of the Board of BancShares and Bank
(Chief Operating Officer)
Frank B. Holding, Jr. 37 President of BancShares and Bank
(Chief Administrative Officer)
Kenneth A. Black 47 Vice President and Treasurer of BancShares; Group Vice
President and Treasurer of Bank (Chief Financial Officer)
Alexander G. MacFadyen, Jr. 57 Secretary of BancShares; Group Vice President and Secretary
of Bank
Wayne D. Duncan 57 Executive Vice President of Bank
(Retail Lending)
John R. Francis, Jr. 45 Executive Vice President of Bank
(Virginia and West Virginia Regional Executive)
William C. Orr 56 Executive Vice President of Bank
(Commercial Credit Administration)
James M. Parker 56 Executive Vice President of Bank
(Eastern Regional Executive)
Edward L. Willingham IV 44 Executive Vice President of Bank
(Central Regional Executive)
J. Allen Woodward 48 Executive Vice President of Bank
(Western Regional Executive)
William J. Cathcart 59 Group Vice President of Bank
(Trust Department)
Joseph A. Cooper, Jr. 45 Group Vice President and Chief Information Officer of Bank
since December 1994; formerly Associate Partner, Andersen
Consulting LLP, Dallas, Texas (1992-1994)
Richard H. Lane 54 Senior Vice President of Bank and General Auditor
</TABLE>
11
<PAGE>
Executive Compensation
The following table shows, for the years ending December 31, 1998, 1997,
and 1996, the cash and certain other compensation paid to or received or
deferred by each of the five named executive officers of BancShares and the
Bank.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation
----------------------------------
Other All
Name and Annual Other
Principal Salary Bonus Compensation Compensation
Position Year ($)(1)(2) ($) ($) ($)(3)
- - -------------------------------------- ------ ----------- ------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Lewis R. Holding 1998 600,623 -0- -0- 7,200
Chairman of the Board 1997 583,165 -0- -0- 9,500
1996 570,979 -0- -0- 9,500
Frank B. Holding 1998 600,623 -0- -0- 7,200
Executive Vice Chairman 1997 583,165 -0- -0- 9,500
of the Board (2) 1996 571,086 -0- -0- 9,500
James B. Hyler, Jr. 1998 456,314 -0- -0- 7,200
Vice Chairman of the Board and 1997 439,693 -0- -0- 9,500
Chief Operating Officer 1996 422,329 -0- -0- 9,500
Frank B. Holding, Jr. 1998 262,572 -0- -0- 7,200
President and Chief 1997 255,648 -0- -0- 8,434
Administrative Officer 1996 250,552 -0- -0- 8,312
James M. Parker 1998 213,916 -0- -0- 7,200
Executive Vice President 1997 207,734 -0- -0- 7,600
of the Bank 1996 199,371 -0- -0- 6,108
</TABLE>
- - ---------
(1) Includes amounts deferred at the election of each named executive officer
pursuant to the Bank's Section 401(k) salary deferral plan.
(2) Of the salary shown above as paid to Frank B. Holding during 1998, 1997,
and 1996, the Bank was reimbursed certain amounts by two of its affiliates
as follows: First-Citizens Bank and Trust Company of South Carolina --
$97,190, $95,051, and $90,525, respectively; and Southern Bank and Trust
Company -- $77,549, $75,842, and $72,231, respectively. These payments
were made pursuant to agreements between the Bank and its affiliates
whereby Mr. Holding provides certain management services to the affiliates
in return for their reimbursement to the Bank of a portion of his salary.
(3) Consists entirely of the Bank's matching contributions on behalf of each
named executive officer under the Bank's Section 401(k) salary deferral
plan.
12
<PAGE>
Pension Plan and Other Post-Retirement Benefits
The following table shows the estimated benefits payable to a participant
at normal retirement age under the Bank's qualified defined benefit pension
plan (the "Pension Plan") based on various numbers of years of service and
levels of compensation.
<TABLE>
<CAPTION>
Years of Service
Final -----------------------------------------------------------------------------------------
Average
Compensation 10 Years 15 Years 20 Years 25 Years 30 Years 35 Years 40 Years
- - ------------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 100,000 $ 16,477 $ 24,715 $ 32,953 $ 41,192 $ 49,430 $ 57,668 $ 63,668
125,000 21,102 31,653 42,203 52,754 63,305 73,856 81,356
150,000 25,727 38,590 51,453 64,317 77,180 90,043 99,043
175,000 30,352 45,528 60,703 75,879 91,055 106,231 116,731
200,000 34,977 52,465 70,066 87,442 104,930 122,418 130,000
225,000 38,533 57,800 77,066 96,333 115,599 130,000 130,000
250,000 38,533 57,800 77,066 96,333 115,599 130,000 130,000
300,000 38,533 57,800 77,066 96,333 115,599 130,000 130,000
400,000 38,533 57,800 77,066 96,333 115,599 130,000 130,000
450,000 38,533 57,800 77,066 96,333 115,599 130,000 130,000
500,000 38,533 57,800 77,066 96,333 115,599 130,000 130,000
550,000 38,533 57,800 77,066 96,333 115,599 130,000 130,000
</TABLE>
Benefits shown in the table are computed as straight life annuities
beginning at age 65 and are not subject to a deduction for Social Security
benefits or any other offset amount. To determine benefits under the Pension
Plan, a participant's compensation includes base salary (including amounts
deferred pursuant to the Bank's Section 401(k) salary deferral plan) and
bonuses, and benefits are based on "final average compensation" which is the
participant's highest average annual compensation for any five consecutive
years during the last ten complete calendar years as a Plan participant.
However, under current tax laws, $160,000 is the maximum amount of compensation
for 1998 that can be included for purposes of calculating a participant's
"final average compensation." The maximum years of service credit for which
benefits may accrue under the Pension Plan is 40 years. The years of service
credit and "final average compensation," respectively, as of January 1, 1999,
for each of the named executive officers are as follows: Mr. L. Holding -- 40
years and $219,224; Mr. F. Holding -- 40 years and $219,224; Mr. Hyler -- 19
years and $216,942; Mr. F. Holding, Jr. -- 15 years and $154,000; Mr. Parker --
32 years and $155,380. During 1998, the maximum annual benefit permitted by tax
laws for a retiring participant was $130,000, and the maximum eligible final
average compensation was $219,224.
In addition to benefits under the Pension Plan, each of certain senior
officers of BancShares and the Bank is party to a separate agreement with the
Bank under which the Bank has agreed to pay a specified monthly amount to the
officer for a period of ten years following retirement at age 65 (or at such
other age as is agreed upon between the Bank and the officer). In return for
such payments, each officer has agreed to provide certain limited consultation
services to, and will not "compete" (as defined in the agreement) against, the
Bank during the period following retirement. If the officer dies during the
period payments are being made under the agreement, the remaining balance of
payments due under the agreement will be paid to the officer's designated
beneficiary or estate. The amounts of monthly payments provided for in the
agreements currently in effect between the Bank and each of the named executive
officers are as follows: Mr. L. Holding -- $22,325; Mr. F. Holding -- $22,325;
Mr. Hyler -- $16,999; Mr. F. Holding, Jr. -- $9,892; and Mr. Parker -- $5,300.
13
<PAGE>
Performance Graph
The following graph compares the cumulative total shareholder return (the
"CTSR") on BancShares' Class A Common Stock during the previous five fiscal
years, with the CTSR over the same measurement period of the Nasdaq-U.S. index
and the Nasdaq Banks index. The graph assumes $100 invested on January 1, 1993,
and that dividends were reinvested in additional shares.
Comparison of Five-Year Cumulative Total Shareholder Return among
First Citizens BancShares, Inc., Nasdaq Banks and
Nasdaq-US Indices
(The Performance Graph appears here. See the table below for plot points.)
Year BancShares Nasdaq Banks Nasdaq-US
1993 $100 $100 $100
1994 95 100 98
1995 122 148 138
1996 171 196 170
1997 231 328 209
1998 203 325 293
Transactions with Management
The Bank has banking transactions in the ordinary course of business with
certain of its directors, executive officers, principal shareholders and their
associates. All extensions of credit included in such transactions have been
approved by the Board of Directors and were made in the ordinary course of
business on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with
other persons, and did not involve more than the normal risk of collectibility
or present other unfavorable features.
Certain specific relationships or transactions with directors are
described above in the footnotes to the table listing directors under the
caption "PROPOSAL 1: ELECTION OF DIRECTORS."
PROPOSAL 2: RATIFICATION OF APPOINTMENT
OF INDEPENDENT PUBLIC ACCOUNTANTS
Subject to ratification by the shareholders, the Board of Directors has
approved the engagement of KPMG LLP, certified public accountants, as
BancShares' independent public accountants for 1999, and a proposal to ratify
that appointment will be submitted at the Annual Meeting. Representatives of
KPMG LLP are expected to be present at the Annual Meeting and available to
respond to appropriate questions and will have the opportunity to make a
statement if they so desire.
14
<PAGE>
THE AUDIT COMMITTEE AND THE BOARD OF DIRECTORS RECOMMEND THAT SHAREHOLDERS
VOTE "FOR" RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS INDEPENDENT PUBLIC
ACCOUNTANTS FOR 1999. THE AFFIRMATIVE VOTE OF A MAJORITY OF THE VOTES
REPRESENTED, IN PERSON AND BY PROXY, AND ENTITLED TO BE CAST AT THE ANNUAL
MEETING IS REQUIRED FOR APPROVAL OF PROPOSAL 2.
PROPOSALS OF SHAREHOLDERS
Any proposal of a shareholder which is intended to be presented for action
at the 2000 Annual Meeting must be received by BancShares at its main office in
Raleigh, North Carolina, no later than November 24, 1999, to be considered
timely received for inclusion in the proxy statement and form of proxy issued
in connection with that meeting. In order for such a proposal to be included in
BancShares' proxy statement and form of proxy, the person submitting it must
own, beneficially or of record, at least 1% or $1,000 in market value of shares
of BancShares' common stock entitled to be voted on that proposal at the Annual
Meeting and must have held those shares for a period of at least one year and
continue to hold them through the date of the meeting. It is anticipated that
the 2000 Annual Meeting will be held during April 2000.
ANNUAL REPORT ON FORM 10-K
BancShares is required to file with the Securities and Exchange Commission
an Annual Report on Form 10-K within 90 days following the end of each fiscal
year. ON OR AFTER MARCH 31, 1999, UPON WRITTEN REQUEST TO KENNETH A. BLACK,
CHIEF FINANCIAL OFFICER, CORPORATE FINANCE DEPARTMENT, FIRST-CITIZENS BANK &
TRUST COMPANY, POST OFFICE BOX 27131, RALEIGH, NORTH CAROLINA 27611-7131, BY A
SHAREHOLDER ENTITLED TO VOTE AT THE ANNUAL MEETING, A COPY OF BANCSHARES'
ANNUAL REPORT ON FORM 10-K FOR 1998, INCLUDING FINANCIAL STATEMENTS AND
SCHEDULES THERETO, WILL BE FORWARDED WITHOUT CHARGE TO THE SHAREHOLDER MAKING
SUCH REQUEST.
OTHER MATTERS
Management knows of no other business that will be brought before the
Annual Meeting or any adjournments thereof. Should other matters properly come
before the Annual Meeting, the proxyholders will be authorized to vote the
shares represented by the enclosed form of proxy in accordance with their best
judgment on such matters.
By Order of the Board of Directors
/s/ Alexander G. MacFadyen, Jr.
Alexander G. MacFadyen, Jr., Secretary
March 22, 1999
15
<PAGE>
********************************************************************************
APPENDIX
FIRST CITIZENS BANCSHARES, INC.
Post Office Box 27131
Raleigh, North Carolina 27611-7131
PROXY SOLICITED BY BOARD OF DIRECTORS
The undersigned hereby appoints GEORGE H. BROADRICK, LEWIS R. HOLDING, FRANK B.
HOLDING, JAMES B. HYLER, JR., FRANK B. HOLDING, JR., CARMEN P. HOLDING,
LEWIS T. NUNNELEE II, and DAVID L. WARD, JR., or any of them, attorneys and
proxies, with power of substitution, to vote all outstanding shares of Class A
and/or Class B common stock of First Citizens BancShares, Inc. ("BancShares")
held of record by the undersigned on March 8, 1999, at the Annual Meeting of
Shareholders of BancShares to be held in the First Citizens Bank Data Center,
100 East Tryon Road, Raleigh, North Carolina, at 1 o'clock p.m. on April 26,
1999, or any adjournments thereof, on the matters listed below:
1. Election of Directors.
[ ] FOR the nominees listed below [ ] WITHHOLD AUTHORITY to vote for all
(except as indicated otherwise). nominees listed below.
<TABLE>
<CAPTION>
<S> <C>
Nominees: J.M. Alexander, Jr.; T.L. Bissett; B.I. Boyle; G.H. Broadrick;
H.M. Craig III; B.M. Farnsworth; L.M. Fetterman; C.P. Holding; F.B.
Holding; F.B. Holding, Jr.; L.R. Holding; C.B.C. Holt; E.A.
Hubbard; J.B. Hyler, Jr.; G.D. Johnson; F.R. Jones; L.S. Jones; W.
McKay; J.T. Maloney, Jr.; J.C. Mayo, Jr.; B.D. Nash; L.T. Nunnelee II;
T.O. Shaw; R.C. Soles, Jr.; and D.L. Ward, Jr.
</TABLE>
(Instruction: TO WITHOLD AUTHORITY TO VOTE FOR ANY NOMINEE, write that
nominee's name on the line below.)
--------------------------------------------------------------
2. Ratification of Appointment of Independent Public Accountants: Proposal
to ratify the appointment of KPMG LLP as independent public accountants of
BancShares for 1999.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Other Business: In their discretion, the persons named herein as
attorneys and proxies are authorized to vote upon such other matters as
may properly come before the meeting.
<PAGE>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AND THIS PROXY WILL BE
CARRIED OUT IN ACCORDANCE WITH THE SPECIFIC INSTRUCTIONS ON THE FRONT OF
THIS FORM. IN THE ABSENCE OF INSTRUCTIONS, THIS PROXY WILL BE VOTED "FOR"
THE ELECTION OF EACH OF THE NOMINEES LISTED IN PROPOSAL 1 AND "FOR"
PROPOSAL 2. IF, AT OR BEFORE THE TIME OF THE MEETING, ANY OF THE NOMINEES
LISTED IN PROPOSAL 1 HAVE BECOME UNWILLING OR UNABLE TO SERVE AS A
DIRECTOR FOR ANY REASON, THE PROXYHOLDERS HAVE THE DISCRETION TO VOTE FOR
A SUBSTITUTE NOMINEE OR NOMINEES. THIS PROXY MAY BE REVOKED AT ANY TIME
BEFORE IT IS EXERCISED BY FILING WITH THE SECRETARY AN INSTRUMENT REVOKING
THE PROXY OR A DULY EXECUTED PROXY BEARING A LATER DATE OR BY ATTENDING
THE ANNUAL MEETING AND REQUESTING THE RIGHT TO VOTE IN PERSON.
Signed: _______________________________
Signed: _______________________________
(If jointly held)
Please date and sign exactly as name
appears at left. When shares are held
by joint tenants, both should sign.
When signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign full
corporate name by president or other
authorized officer. If a partnership,
please sign in partnership name by
authorized person.
Dated:____________________________,1999
IMPORTANT: Please mark, sign, date and
promptly return the proxy
form using the enclosed
envelope.
