SCHEDULE 14A
(Rule 14a-101)
Information Required in Proxy Statement
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:
<TABLE>
<CAPTION>
<S> <C>
[ ] 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 Rule 14a-
11(c) or Rule 14a-12
</TABLE>
INDEPENDENT COMMUNITY BANKSHARES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the 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)(1) 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.
<PAGE>
(1) Amount previously paid:
....................................................................
(2) Form, Schedule or Registration Statement no.:
....................................................................
(3) Filing Party:
....................................................................
(4) Date Filed:
....................................................................
<PAGE>
INDEPENDENT COMMUNITY BANKSHARES, INC.
Dear Shareholder:
You are cordially invited to attend the 1999 Annual Meeting of
Shareholders of Independent Community Bankshares, Inc. (the "Company") to be
held on Wednesday, April 21, 1999 at 10:00 a.m. at the Middleburg office of The
Middleburg Bank, 111 West Washington Street, Middleburg, Virginia. At the Annual
Meeting, you will be asked to elect 14 directors for terms of one year each and
to ratify the appointment of independent auditors for the Company for 1999.
Enclosed with this letter is a formal notice of the Annual Meeting, a Proxy
Statement and a form of proxy.
Whether or not you plan to attend the Annual Meeting, it is important
that your shares be represented and voted. Please complete, sign, date and
return the enclosed proxy promptly using the enclosed postage-paid envelope. The
enclosed proxy, when returned properly executed, will be voted in the manner
directed in the proxy.
We hope you will participate in the Annual Meeting, either in person or
by proxy.
Sincerely,
/s/ Joseph L. Boling
Joseph L. Boling
Chairman and Chief Executive Officer
Middleburg, Virginia
March 26, 1999
<PAGE>
INDEPENDENT COMMUNITY BANKSHARES, INC.
111 West Washington Street
Middleburg, Virginia 20117
___________________
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
___________________
The Annual Meeting of Shareholders (the "Annual Meeting") of
Independent Community Bankshares, Inc. (the "Company") will be held on
Wednesday, April 21, 1999 at 10:00 a.m. at the Middleburg office of The
Middleburg Bank, 111 West Washington Street, Middleburg, Virginia, for the
following purposes:
1. To elect 14 directors to serve for terms of one year each
expiring at the 2000 annual meeting of shareholders;
2. To ratify the appointment of the firm of Yount, Hyde & Barbour,
P.C. as independent auditors for the Company for the fiscal year
ending December 31, 1999; and
3. To act upon such other matters as may properly come before the
Annual Meeting.
Only holders of shares of Common Stock of record at the close of
business on March 3, 1999, the record date fixed by the Board of Directors of
the Company, are entitled to notice of, and to vote at, the Annual Meeting.
By Order of the Board of Directors
/s/ Alice P. Frazier
Alice P. Frazier
Senior Vice President and Chief Financial Officer
March 26, 1999
________________________________________________________________________________
YOU ARE CORDIALLY INVITED TO ATTEND THIS MEETING. IT IS IMPORTANT THAT YOUR
SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. EVEN IF YOU PLAN TO BE
PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THIS MEETING, YOU MAY VOTE
EITHER IN PERSON OR BY YOUR PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN
WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
________________________________________________________________________________
<PAGE>
INDEPENDENT COMMUNITY BANKSHARES, INC.
111 West Washington Street
Middleburg, Virginia 20117
PROXY STATEMENT
This Proxy Statement is furnished to holders of the common stock, par
value $5.00 per share ("Common Stock"), of Independent Community Bankshares,
Inc. (the "Company"), in connection with the solicitation of proxies by the
Board of Directors of the Company to be used at the 1999 Annual Meeting of
Shareholders (the "Annual Meeting") to be held on Wednesday, April 21, 1999 at
10:00 a.m. at the Middleburg office of The Middleburg Bank, 111 West Washington
Street, Middleburg, Virginia, and any duly reconvened meeting after adjournment
thereof.
Any shareholder who executes a proxy has the power to revoke it at any
time by written notice to the Secretary of the Company, by executing a proxy
dated as of a later date, or by voting in person at the Annual Meeting. It is
expected that this Proxy Statement and the enclosed proxy card will be mailed on
or about March 26, 1999 to all shareholders entitled to vote at the Annual
Meeting.
The cost of soliciting proxies for the Annual Meeting will be borne by
the Company. The Company does not intend to solicit proxies otherwise than by
use of the mails, but certain officers and regular employees of the Company or
its subsidiaries, without additional compensation, may use their personal
efforts, by telephone or otherwise, to obtain proxies. The Company may also
reimburse banks, brokerage firms and other custodians, nominees and fiduciaries
for their reasonable out-of-pocket expenses in forwarding proxy materials to the
beneficial owners of shares of Common Stock.
On March 3, 1999, the record date for determining those shareholders
entitled to notice of and to vote at the Annual Meeting, there were 1,778,994
shares of Common Stock issued and outstanding. Each outstanding share of Common
Stock is entitled to one vote on all matters to be acted upon at the Annual
Meeting. A majority of the shares of Common Stock entitled to vote, represented
in person or by proxy, constitutes a quorum for the transaction of business at
the Annual Meeting.
A shareholder may abstain or (only with respect to the election of
directors) withhold his or her vote (collectively, "Abstentions") with respect
to each item submitted for shareholder approval. Abstentions will be counted for
purposes of determining the existence of a quorum. Abstentions will not be
counted as voting in favor of the relevant item.
A broker who holds shares in "street name" has the authority to vote on
certain items when it has not received instructions from the beneficial owner.
Except for certain items for which brokers are prohibited from exercising their
discretion, a broker is entitled to vote on matters put to shareholders without
instructions from the beneficial owner. Where brokers do not have or do not
exercise such discretion, the inability or failure to vote is referred to as a
"broker nonvote." Under the circumstances where the broker is not permitted to,
or does not, exercise its discretion, assuming proper disclosure to the
<PAGE>
Company of such inability to vote, broker nonvotes will not be counted for
purposes of determining the existence of a quorum, and also will not be counted
as not voting in favor of the particular matter.
The Board of Directors is not aware of any matters other than those
described in this Proxy Statement that may be presented for action at the Annual
Meeting. However, if other matters do properly come before the Annual Meeting,
the persons named in the enclosed proxy card possess discretionary authority to
vote in accordance with their best judgment with respect to such other matters.
PROPOSAL ONE
ELECTION OF DIRECTORS
The Board of Directors consists of 14 directors, each of whom is
nominated for election as a director at the Annual Meeting.
The election of each nominee for director requires the affirmative vote
of the holders of a plurality of the shares of Common Stock cast in the election
of directors. If the proxy is executed in such manner as not to withhold
authority for the election of any or all of the nominees for directors, then the
persons named in the proxy will vote the shares represented by the proxy for the
election of the 14 nominees named below. If the proxy indicates that the
shareholder wishes to withhold a vote from one or more nominees for director,
such instructions will be followed by the persons named in the proxy.
Each nominee has consented to being named in this Proxy Statement and
has agreed to serve if elected. The Board of Directors has no reason to believe
that any of the nominees will be unable or unwilling to serve. If, at the time
of the Annual Meeting, any nominee is unable or unwilling to serve as a
director, votes will be cast, pursuant to the enclosed proxy, for such
substitute nominee as may be nominated by the Board of Directors. There are no
current arrangements between any nominee and any other person pursuant to which
a nominee was selected. No family relationships exist among any of the directors
or between any of the directors and executive officers of the Company.
The following biographical information discloses each nominee's age,
business experience in the past five years and the year each individual was
first elected to the Board of Directors or its predecessor:
Nominees for Election Whose Terms Expire in 2000
Howard M. Armfield, 56, has been a director since 1984.
Mr. Armfield is Executive Vice President and owner of Armfield,
Harrison & Thomas, Inc., an independent insurance agency in Leesburg,
Virginia.
Joseph L. Boling, 54, has been a director since 1993.
Mr. Boling has been the Chairman, President and Chief Executive Officer
of the Company and The Middleburg Bank (the "Bank"), a subsidiary of
the Company, since April 1997. From February 1993 to April 1997, he was
President and Chief Executive Officer of the Company and the Bank.
Prior to employment by the Company and the Bank, he was a Senior Vice
President of Crestar Bank in Richmond, Virginia.
Childs Frick Burden, 48, has been a director since 1997.
Mr. Burden is a partner with Secor Group, an investment firm in
Washington, D.C.
2
<PAGE>
J. Lynn Cornwell, Jr., 74, has been a director since 1984.
Mr. Cornwell is President and owner of J. Lynn Cornwell, Inc., a real
estate development company in Loudoun County.
William F. Curtis, 70, has been a director since 1962.
Mr. Curtis is currently retired. Until February 1993, he had served as
President and Chief Executive Officer of the Bank for 25 years.
F. E. Deacon, III, 43, has been a director since 1997.
Mr. Deacon is President and Chief Executive Officer of The Tredegar
Trust Company ("Tredegar"), a trust company in Richmond, Virginia and a
subsidiary of the Company.
George A. Horkan, Jr., 76, has been a director since 1961.
Mr. Horkan is President of George A. Horkan, Jr., P.C., a law firm in
Upperville, Virginia.
C. Oliver Iselin, III, 69, has been a director since 1975.
Mr. Iselin is owner and operator of the Wolver Hill Farm.
William S. Leach, 70, has been a director since 1970.
Mr. Leach is a retired businessman with over 30 years experience. Most
recently he served a three-year term as Town Administrator for the Town
of Middleburg.
Thomas W. Nalls, 57, has been a director since 1997.
Mr. Nalls is a partner with Hazel & Thomas, P.C., a law firm in
Leesburg, Virginia.
John C. Palmer, 63, has been a director since 1974.
Mr. Palmer retired as Senior Vice President of the Bank in 1995 after
27 years of service.
John Sherman, 58, has been a director since 1997.
Mr. Sherman is owner and operator of The Ashby Inn in Paris, Virginia.
Millicent W. West, 77, has been a director since 1975.
Ms. West has served in many volunteer positions in the Garden Club of
America and Garden Club of Virginia.
Edward T. Wright, 62, has been a director since 1972.
Mr. Wright retired as Senior Vice President of the Bank in 1998 after
42 years of service.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
NOMINEES SET FORTH ABOVE.
Executive Officers Who Are Not Directors
Alice P. Frazier (Age 34) has served as Senior Vice President and Chief
Financial Officer since April 1993. From May 1991 until April 1993, she served
as the Bank's Loan Review Officer. From December 1988 until May 1991, she was
employed by Yount, Hyde & Barbour, P.C., certified public accountants.
3
<PAGE>
Arch A. Moore (Age 47) has served as Senior Vice President and Senior
Lender since February 1995. From March 1983 to February 1995, he served in
various positions, the last of which was Manager of the Northern Virginia
Business Banking Group, with First American/First Union.
William E. Doyle (Age 46) has served as Senior Vice President, Mortgage
and Retail Services, since November 1997. From 1996 to 1997, he was a private
consultant in the banking industry and, from 1982 to 1996, he was a Senior Vice
President with Crestar Bank.
Security Ownership of Management
The following table sets forth, as of March 3, 1999 certain information
with respect to beneficial ownership of shares of Common Stock by each of the
members of the Board of Directors, by each of the executive officers named in
the "Summary Compensation Table" below and by all directors and executive
officers as a group. Beneficial ownership includes shares, if any, held in the
name of the spouse, minor children or other relatives of a director living in
such person's home, as well as shares, if any, held in the name of another
person under an arrangement whereby the director or executive officer can vest
title in himself at once or at some future time.
<TABLE>
<CAPTION>
Amount and Nature of
Name Beneficial Ownership Percent of Class (%)
- ---- -------------------- --------------------
<S> <C> <C>
Howard M. Armfield 18,304 1.03
Joseph L. Boling (1) 21,485 1.21
Childs Frick Burden 5,760 *
J. Lynn Cornwell, Jr. 4,144 *
William F. Curtis (2) 114,756 6.45
F. E. Deacon, III (1) 12,306 *
William E. Doyle, Jr. (1) 1,751 *
George A. Horkan, Jr. 72,000 4.05
C. Oliver Iselin, III 42,400 2.38
William S. Leach (2) 53,232 2.99
Arch A. Moore, III (1) 7,256 *
Thomas W. Nalls 850 *
John C. Palmer 26,086 1.47
John Sherman 230 *
Millicent W. West 248,004 13.94
Edward T. Wright (1) 60,420 3.40
Directors and executive officers
as a group (17 persons) (1) 696,712 36.16
</TABLE>
* Percentage of ownership is less than one percent of the outstanding shares
of Common Stock.
(1) Amounts disclosed include shares of Common Stock issuable upon the exercise
of stock options exercisable within 60 days of March 3, 1999.
(2) Amounts disclosed include shares of Common Stock beneficially owned by a
trust of which Messrs. Curtis and Leach serve as trustees.
4
<PAGE>
Security Ownership of Certain Beneficial Owners
Millicent W. West, P.O. Box 236, Upperville, Virginia, owns 234,004
shares, or 14.48% of the outstanding shares of Common Stock. To the Company's
knowledge, no other person owns five percent or more of the outstanding shares
of Common Stock.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's directors and executive officers, and any persons who own
more than 10% of the outstanding shares of Common Stock, to file with the
Securities and Exchange Commission ("SEC") reports of ownership and changes in
ownership of Common Stock. Officers and directors are required by SEC
regulations to furnish the Company with copies of all Section 16(a) reports that
they file. Based solely on review of the copies of such reports furnished to the
Company or written representation that no other reports were required, the
Company believes that, during fiscal year 1998, all filing requirements
applicable to its officers and directors were complied with, except for the
following: Millicent W. West, a director and 10% owner of Common Stock,
inadvertently filed late a report on Form 4 covering sales of shares of Common
Stock in August 1998, C. Oliver Iselin, III, a director, inadvertently filed
late a report on Form 4 covering the purchase of shares of Common Stock by his
spouse in August 1998, Joseph L. Boling, a director and executive officer, and
Alice P. Frazier, an executive officer, each inadvertently filed late reports on
Form 4 covering the purchase of shares of Common Stock in August 1998 and the
grant of options in December 1998, and F. E. Deacon, III, William E. Doyle, Jr.,
and Arch A. Moore, III, executive officers, each inadvertently filed a late
report on Form 4 covering the grant of options in December 1998.
The Board of Directors and its Committees
There were 10 meetings of the Board of Directors in 1998. Each director
attended greater than 75% of the aggregate number of meetings of the Board of
Directors and meetings of committees of which the director was a member in 1998.
The Executive Committee, which acts for the Board of Directors when the
Board is not in session, consists of Mrs. West and Messrs. Armfield, Boling,
Cornwell, Nalls and Leach. The Executive Committee met five times during the
year ended December 31, 1998.
The Bank has an Examining and Compliance Committee, which consists of
Mrs. West and Messrs. Armfield, Burden, Sherman and Iselin. The Examining and
Compliance Committee is responsible for examining the affairs of the Bank at
least annually, reporting the results of examinations and recommending changes
in the manner of doing business. The Examining and Compliance Committee held
three meetings during the year ended December 31, 1998.
The Nominating Committee consists of Mrs. West and Messrs. Boling,
Curtis, Horkan and Iselin and nominates the individuals proposed for election as
directors. Shareholders entitled to vote for election of directors may nominate
candidates for consideration by the Nominating Committee under procedures that
the Company has established. See "Proposals for 2000 Annual Meeting of
Shareholders." The Nominating Committee met one time during the year ended
December 31, 1998.
The Company does not have a standing audit or compensation committee.
5
<PAGE>
Director Compensation
As compensation for their services to the Company, each member of the
Board of Directors receives a fee of $300 for each meeting of the Board and $250
for each Committee meeting attended. Board members who are also officers do not
receive any additional compensation above their regular salary for attending
committee meetings. In 1998, directors received $48,550 in the aggregate as
compensation for their services as directors.
Executive Compensation
The following table shows, for the fiscal years ended December 31,
1998, 1997 and 1996, the cash compensation paid by the Company and its
subsidiaries, as well as certain other compensation paid or accrued for those
years, to each of the named executive officers in all capacities in which they
served:
Summary Compensation Table
--------------------------
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------- ----------------------
Securities
Name and Other Annual Underlying All Other
Principal Position Year Salary ($) Bonus ($) Compensation ($) Options (#) Compensation ($)(1)
------------------ ---- ---------- --------- ---------------- ----------- -------------------
<S> <C> <C> <C> <C> <C> <C>
Joseph L. Boling 1998 191,407 30,000 * 10,000 --
Chairman, President and 1997 186,980 20,000 * 20,000 --
Chief Executive Officer 1996 178,820 15,000 * -- 21,433
Edward T. Wright 1998 98,607 6,902 7,025 -- 7,354
Senior Vice President (2) 1997 119,294 8,350 * 2,000 8,638
1996 107,150 8,929 * -- 7,821
Arch A. Moore, III 1998 109,647 7,675 * 4,000 --
Senior Vice President 1997 101,375 7,096 * 10,000 --
1996 91,711 7,500 21,712 (3) -- 8,967
F. E. Deacon, III (4) 1998 143,000 -0- * 5,000 --
President and Chief 1997 52,333 3,900 * 10,000 --
Executive Officer of
Tredegar
William E. Doyle, Jr. (5) 1998 135,000 9,450 13,964(6) 4,000 --
Senior Vice President 1997 14,250 5,000 * -- --
</TABLE>
__________________________
* All benefits that might be considered of a personal nature did not exceed
the lesser of $50,000 or 10% of total annual salary and bonus.
(1) Amounts presented represent gross value of payments made by the Bank year
pursuant to split-dollar life insurance agreements between the Company and
the named executive officers.
(2) Mr. Wright retired from the Company on September 30, 1998. Amount presented
in "Other Annual Compensation" represents a gift to Mr. Wright upon his
retirement.
(3) Amount presented includes $12,500 paid by the Bank for Mr. Moore's
initiation fees for the Middleburg Tennis Club and the Loudoun Golf and
Country Club and $7,883 paid by the Bank for the increase in Mr. Moore's
income tax associated with such benefits.
6
<PAGE>
(4) The Company acquired Tredegar on August 1, 1997, and the amount presented
reflects the amount earned by Mr. Deacon from August 1, 1997 to December
31, 1997.
(5) Mr. Doyle joined the Company on November 21, 1997.
(6) Amount presented includes $6,000 paid by the Bank for Mr. Doyle's
initiation fees for the Loudoun Golf and Country Club and $7,964 paid by
the Bank associated with moving expenses.
Stock Options
The following table sets forth for the year ended December 31, 1998,
the grants of stock options to the named executive officers:
Option Grants In Last Fiscal Year
<TABLE>
<CAPTION>
Percent of Total
Number of Securities Options Granted to
Underlying Options Employees in Fiscal Exercise or Base
Granted (#) (1) Year (%) (2) Price ($/Share) Expiration Date
--------------- ------------ --------------- ---------------
<S> <C> <C> <C> <C>
Joseph L. Boling 10,000 32.3 23.50 December 16, 2008
Arch A. Moore, III 4,000 12.9 23.50 December 16, 2008
F. E. Deacon, III 5,000 16.1 23.50 December 16, 2008
William E. Doyle, Jr. 4,000 12.9 23.50 December 16, 2008
</TABLE>
____________________
(1) Stock options were awarded at or above the fair market value of the shares
of Common Stock at the date of award.
(2) Options to purchase 31,000 shares of Common Stock were granted to employees
during the year ended December 31, 1998.
The following table sets forth the amount and value of stock options
held by the named executive officers as of December 31, 1998.
7
<PAGE>
Fiscal Year End Option Values
<TABLE>
<CAPTION>
Number of
Securities Underlying Value of Unexercised
Unexercised Options at In-the-Money Options
Fiscal Year End (#) at Fiscal Year End ($)(1)
------------------- -------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Joseph L. Boling 14,700 15,300 70,560 49,440
Edward T. Wright 2,000 -- 12,000 --
Arch A. Moore, III 7,056 6,944 35,280 24,720
F. E. Deacon, III 7,350 6,650 35,280 24,720
William E. Doyle, Jr. 1,176 2,824 -- --
</TABLE>
_____________________
(1) The value of in-the-money options at fiscal year end was calculated by
determining the difference between the fair market value of the Common
Stock underlying the options on December 31, 1998 and the exercise price of
the options.
Employment Agreements
Effective as of January 1, 1998, the Company and Joseph L. Boling
entered into an employment contract that provides for Mr. Boling's service as
Chairman, President and Chief Executive Officer of both the Company and the
Bank. Mr. Boling's employment contract is for five years at an initial base
annual salary of $191,408, and he is eligible for base salary increases and
bonuses as determined by the Executive Committee of the Board of Directors. Mr.
Boling's employment may be terminated by the Company with or without cause. If
he resigns for "good reason" or is terminated without "cause" (as those terms
are defined in the employment agreement), however, he is entitled to salary and
certain benefits for the greater of the remainder of his contract or three
years. Mr. Boling's contract also contains a covenant not to compete if his
employment terminates for any reason other than a change in control of the
Company.
A deferred compensation plan has been adopted for the Chairman and
Chief Executive Officer. Benefits are to be paid in monthly installments for 15
years following retirement or death. The agreement provides that, if employment
is terminated for reasons other than death or disability prior to age 65, the
amount of benefits would be reduced. The deferred compensation expense for 1998,
1997 and 1996, based on the present value of the retirement benefits, was
$15,698, $16,627 and $15,539, respectively. The plan is unfunded. However, life
insurance has been acquired on the life of the employee in an amount sufficient
to discharge the obligation.
Effective as of March 27, 1997, Tredegar and F. E. Deacon, III, who
serves as President and Chief Executive Officer of Tredegar, entered into an
employment agreement that will expire on August 1, 2000. Under his employment
agreement, Mr. Deacon's current base annual salary is $148,720, and he is
eligible for base salary increases and bonuses as determined by the Board of
Directors. He will also be entitled to a bonus, up to a maximum of $27,000 in
any year, if Tredegar's cumulative net earnings equal or exceed certain levels
as described in the agreement. This employment agreement does not provide for
any
8
<PAGE>
additional compensation in the event of a change in control of the Company and
does prohibit Mr. Deacon from competing with Tredegar for a period of one year
following a termination of his employment by Tredegar for any reason.
Transactions with Management
Some of the directors and officers of the Company are at present, as in
the past, customers of the Company, and the Company has had, and expects to have
in the future, banking transactions in the ordinary course of its business with
directors, officers, principal shareholders and their associates, on
substantially the same terms, including interest rates and collateral on loans,
as those prevailing at the same time for comparable transactions with others.
These transactions do not involve more than the normal risk of collectibility or
present other unfavorable features. The balance of loans to directors, executive
officers and their associates totaled $3,246,556 at December 31, 1998, or 14.2%
of the Company's equity capital at that date.
There were no transactions during 1998 between the Company's directors
or officers and the Company's retirement or profit sharing plans, nor are there
any proposed transactions. Additionally, there are no legal proceedings to which
any director, officer, principal shareholder or associate is a party that would
be material and adverse to the Company.
PROPOSAL TWO
APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed, subject to shareholder approval,
the firm of Yount, Hyde & Barbour, P.C. as independent public accountants to
audit the consolidated financial statements of the Company for the fiscal year
ending December 31, 1999. Yount, Hyde & Barbour, P.C. has audited the financial
statements of the Company and the Bank for over 25 years. A majority of the
votes cast by holders of the Common Stock is required for the ratification of
the appointment of the independent public accountants.
Representatives of Yount, Hyde & Barbour, P.C. are expected to be
present at the Annual Meeting, will have an opportunity to make a statement, if
they desire to do so, and will be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
APPOINTMENT OF YOUNT, HYDE & BARBOUR, P.C. AS INDEPENDENT PUBLIC ACCOUNTANTS FOR
THE FISCAL YEAR ENDING DECEMBER 31, 1999.
PROPOSALS FOR 2000 ANNUAL MEETING OF SHAREHOLDERS
Under the regulations of the Securities and Exchange Commission, any
shareholder desiring to make a proposal to be acted upon at the 2000 annual
meeting of shareholders must cause such proposal to be received, in proper form,
at the Company's principal executive offices at 111 West Washington Street,
Middleburg, Virginia 20117, no later than November 27, 1999, in order for the
proposal to be considered for inclusion in the Company's Proxy Statement for
that meeting. The Company presently anticipates holding the 2000 annual meeting
of shareholders on April 19, 2000.
9
<PAGE>
The Company's Bylaws also prescribe the procedure a shareholder must
follow to nominate directors or to bring other business before shareholders'
meetings. For a shareholder to nominate a candidate for director at the 2000
annual meeting of shareholders, notice of nomination must be received by the
Secretary of the Company not less than 60 days and not more than 90 days prior
to the date of the 2000 annual meeting. The notice must describe various matters
regarding the nominee and the shareholder giving the notice. For a shareholder
to bring other business before the 2000 annual meeting of shareholders, notice
must be received by the Secretary of the Company not less than 60 days and not
more than 90 days prior to the date of the 2000 annual meeting. The notice must
include a description of the proposed business, the reasons therefor, and other
specified matters. Any shareholder may obtain a copy of the Company's Bylaws,
without charge, upon written request to the Secretary of the Company. Based upon
an anticipated date of April 19, 2000 for the 2000 annual meeting of
shareholders, the Company must receive any notice of nomination or other
business no later than February 19, 2000 and no earlier than January 20, 2000.
OTHER MATTERS
THE COMPANY'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED DECEMBER 31,
1998, INCLUDING FINANCIAL STATEMENTS, IS BEING MAILED TO SHAREHOLDERS WITH THIS
PROXY STATEMENT. A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR 1998
FILED WITH THE COMMISSION, EXCLUDING EXHIBITS, MAY BE OBTAINED WITHOUT CHARGE BY
WRITING TO ALICE P. FRAZIER, SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER,
WHOSE ADDRESS IS P.O. BOX 5, MIDDLEBURG, VIRGINIA 20118.
10
<PAGE>
<TABLE>
<CAPTION>
PLEASE MARK VOTES REVOCABLE PROXY
|X| AS IN THIS EXAMPLE INDEPENDENT COMMUNITY BANKSHARES, INC.
<S> <C>
With- For All
Proxy Solicited on Behalf of the Board of Directors For hold Except
The undersigned hereby appoints David B. B. Hall 1. To elect as directors the 14 _ _ _
and Robert Slater, jointly and severally, proxies, persons listed as nominees below. |_| |_| |_|
with full power to act alone and with full power
of substitution, to represent the undersigned and Howard M. Armfield F.E. Deacon, III John C. Palmer
to vote, as designated below and upon any and all Joseph L. Boling George A. Horkan, III John Sherman
other matters that may properly be brought before Childs Frick Burden C. Oliver Iselin, III Millicent W. West
such meeting, all shares of Common Stock that the J. Lynn Cornwell, Jr. William S. Leach Edward T. Wright
undersigned would be entitled to vote at the Annual William F. Curtis Thomas W. Nalls
Meeting of Shareholders of Independent Community
Bankshares, Inc., a Virginia corporation (the INSTRUCTION: To withhold authority to vote for any individual
"Corporation") to be held at the Middleburg office nominee, mark "For All Except" and write that nominee's name in the
of The Middleburg Bank, 111 West Washington Street, space provided below.
Middleburg, Virginia, on Wednesday, April 21, 1999,
at 10:00 a.m., local time or at any adjournments _____________________________________________________________________
thereof, for the following purposes:
For Against Abstain
_ _ _
2. To ratify the appointment of Yount, |_| |_| |_|
Hyde, & Barbour, P.C. as
independent auditors for the
Corporation for the fiscal year
ending December 31, 1999.
3. In their discretion, the proxies are authorized to vote upon
any other business that may properly come before the meeting,
or any adjournment thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE SHAREHOLDER. IF NO DIRECTION IS GIVEN, THIS
------------------------- PROXY WILL BE VOTED "FOR" ALL NOMINEES LISTED IN ITEM 1 AND "FOR"
Please be sure to sign and date | Date | ITEM 2.
this Proxy in the box below | |
---------------------------------------------------------- If signing as Attorney, Executor, Administrator, Guardian or
| | Trustee, please add your title as such.
| |
|-Shareholder sign above---Co-holder (if any) sign above-|
</TABLE>
^ Detach above card, sign, date and mail in postage paid envelope provided. ^
INDEPENDENT COMMUNITY BANKSHARES, INC.
- --------------------------------------------------------------------------------
| PLEASE ACT PROMPTLY |
| SIGN, DATE & MAIL YOUR PROXY CARD TODAY |
- --------------------------------------------------------------------------------
