UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)
SWVA BANCSHARES, INC.
(Name of Issuer)
Common Stock, $.10 par value
(Title of Class of Securities)
785040106
(CUSIP Number)
Charles R. Haywood
Foley & Lardner
One IBM Plaza
330 North Wabash Avenue
Suite 3300
Chicago, Illinois 60611
(312) 755-2510
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 1, 1997
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the
following box [ ].
<PAGE>
1 Name of Reporting Person
S.S. or I.R.S. Identification Number of Above Person (optional)
Richard J. Nelson
2 Check The Appropriate Box If a Member of a Group (a)[ ]
(b)[ ]
3 SEC Use Only
4 Source of Funds: Not Applicable
5 Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) [X]
6 Citizenship or Place of Organization
United States
7 Sole Voting Power
26,000 shares
Number of
Shares 8 Shared Voting Power
Beneficially 0 shares
Owned By
Each Reporting 9 Sole Dispositive Power
Person With 26,000 shares
10 Shared Dispositive Power
0 shares
11 Aggregate Amount Beneficially Owned by Each Reporting Person
26,000 shares
12 Check Box If The Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
13 Percent of Class Represented By Amount in Row (11)
5.0%
14 Type of Reporting Person
IN
1. Security and Issuer
This is Amendment No. 1 to the Schedule 13D (the "Original 13D") filed by
Richard J. Nelson and relates to the common stock, $.10 par value (the
"Common Stock"), of SWVA Bancshares (the "Issuer"). The address of the
principal executive offices of the Issuer is 302 Second Street, Roanoke,
Virginia 24011. The following items in the Original 13D are amended to
read in their entirety as follows:
Item 4. Purpose of Transaction
Mr. Nelson's goal is to profit from appreciation in the market price of
the Common Stock. Mr. Nelson expects to actively assert shareholder rights
in connection with his goal. By letter dated September 10, 1997, Mr.
Nelson stated his intent to nominate Dewey W. Chapple, Jr. for election as
a director of the Issuer at the 1997 Annual Meeting of Stockholders. A
copy of that letter is attached as Exhibit 1. Prior to that letter, Mr.
Nelson had corresponded with the Issuer regarding the possibility of Mr.
Chapple's becoming a Board nominee for election to the Board of Directors
of the Issuer. The Board refused to nominate Mr. Chapple. By letter
dated October 1, 1997, Mr. Nelson withdrew his notice of intent to
nominate Mr. Chapple for election as a director of the Issuer. A copy of
that letter is attached as Exhibit 2.
Mr. Nelson's decision to withdraw his notice of intent to nominate Mr.
Chapple followed several weeks of contentious discussions with current
management of the Issuer regarding Mr. Nelson's demand to inspect and copy
the Issuer's stockholder list and certain other corporate books and
records (the "Corporate Records") pursuant to his rights as a stockholder
under the Virginia corporate statutes. Mr. Nelson's first demand for the
Corporate Records was made by a letter dated September 10, 1997, a copy of
which is attached as Exhibit 3. Mr. Nelson repeated the demand in a
letter to the Issuer dated September 12, 1997, a copy of which is attached
as Exhibit 4.
Current management of the Issuer responded to Mr. Nelson by two separate
letters on September 12, 1997, copies of which are attached as Exhibits 5
and 6. In response, Mr. Nelson repeated his demand in letters dated
September 12 and 13, 1997, copies of which are attached as Exhibits 7 and
8, respectively, specifying a date for inspection and copying of the
Corporate Records. By letter dated September 15, 1997, a copy of which is
attached as Exhibit 9, current management again objected to Mr. Nelson's
demand on the basis of inadequate notice. Mr. Nelson responded by letter
dated September 16, 1997, a copy of which is attached as Exhibit 10,
setting a new date for inspection, and Cede & Co. provided formal notice
of the inspection date by letter dated September 17, 1997, a copy of which
is attached as Exhibit 11.
Current management of the Issuer responded to Mr. Nelson's September 16
letter and confirmed the date set for inspection and copying by letters
dated September 18 and 19, 1997, copies of which are attached as Exhibits
12 and 13, respectively. On September 22, 1997, Mr. Nelson confirmed by
letter, a copy of which is attached as Exhibit 14, that the Corporate
Records would be made available for inspection and copying on the agreed
date.
On September 24, 1997, Mr. Nelson received a letter from current
management of the Issuer indicating that not all of the requested
documents would be available on the date designated for inspection and
copying, but assuring Mr. Nelson that the Issuer would have available
"what you are entitled to review." A copy of that letter is attached as
Exhibit 15.
On September 25, 1997, the day appointed for inspection and copying of the
Corporate Records, a local representative of Mr. Nelson appeared at the
offices of the Issuer as scheduled. The representative originally was
denied access to the Corporate Records, and then was granted access but
denied the right to make copies of the documents. By letter dated
September 26, 1997, Mr. Nelson's Virginia counsel, Theodore Craddock,
reminded current management that failure to provide this copying right was
in contravention of Mr. Nelson's rights as a stockholder under Virginia
corporation law. A copy of that letter is attached as Exhibit 16.
Copies of some of the Corporate Records were provided to Mr. Nelson on
September 26, 1997. Exhibits 17, 18 and 19 contain additional
correspondence regarding these documents.
On September 27, 1997, Mr. Nelson sent a letter to Mr. Glen Combs, a
current director of the Issuer, describing his difficulties with the
Issuer's management and enclosing copies of correspondence regarding his
demand for the Corporate Records. A copy of that letter is attached as
Exhibit 20.
On September 29, 1997, in response to Mr. Nelson's September 27 letter to
Mr. Combs and Mr. Craddock's letter of September 26, current management of
the Issuer sent Mr. Nelson a letter denying that the Issuer had failed to
meet its obligations to Mr. Nelson. Mr. Craddock responded to that letter
on October 1, 1997. Copies of those letters are attached as Exhibits 21
and 22.
Mr. Nelson's purpose in seeking a representative on the Board of Directors
was primarily to attempt to influence the Board of Directors to consider
all possible strategic alternatives available to the Issuer in order to
increase the market price of the Common Stock. One way of achieving this
goal is to seek out another financial institution and attempt to implement
a business combination. Mr. Nelson continues to be interested in
influencing the Issuer's Board of Directors to explore seriously, in
consultation with independent financial advisors, this and other possible
means of improving the market price of the Common Stock, to the extent
such options may not have already been fully explored. To the extent such
influence may be deemed to constitute a "control purpose" with respect to
the Securities Exchange Act of 1934, as amended, and the regulations
thereunder, Mr. Nelson has such a purpose.
The above-stated purpose to control is unrelated to the Office of Thrift
Supervision ("OTS") regulations. Specifically, Mr. Nelson is aware that
regulations promulgated by the OTS contain separate standards with regard
to acquisition of "control" of a federally chartered savings institution,
such as the Issuer's subsidiary bank. Those regulations require OTS
approval for acquisition of control under certain conditions. Some of the
provisions are based in part on numerical criteria. One of the provisions
creates a rebuttable presumption of control where a person acquires more
than 10 percent of the voting stock of a savings association and other
conditions are met. Another provision creates a rebuttable presumption of
control where a person acquires proxies to elect one-third or more of the
savings association's board of directors and other conditions are met.
Mr. Nelson has no present plans to cross these numerical thresholds.
Mr. Nelson intends to continue to evaluate the Issuer and its business
prospects and intends to consult with management of the Issuer, other
shareholders of the Common Stock or other persons to further his
objectives. Mr. Nelson may make further purchases of shares of the Common
Stock or may dispose of any or all of his shares of the Common Stock at
any time. At present, and except as disclosed herein, Mr. Nelson has no
specific plans or proposals that relate to, or could result in, any of the
matters referred to in paragraphs (a) through (j), inclusive, of Item 4 of
Schedule 13D. Mr. Nelson intends to continue to explore the options
available to him. Mr. Nelson may, at any time or from time to time, review
or reconsider his position with respect to the Issuer and may formulate
plans with respect to matters referred to in Item 4 of Schedule 13D.
Item 7. Material to be Filed as Exhibits
No. Description
1 Letter from Richard J. Nelson to Barbara C. Weddle, dated
September 10, 1997.*
2 Letter from Richard J. Nelson to Barbara C. Weddle, dated
October 1, 1997.
3 Letter from Cede & Co. (on behalf of Mr. Nelson) to Barbara C.
Weddle, dated September 10, 1997.
4 Letter from Richard J. Nelson to B.L. Rakes, dated September
12, 1997.
5 Letter from B.L. Rakes to Richard J. Nelson, dated September 12,
1997.
6 Letter from B.L. Rakes to Richard J. Nelson, dated September 12,
1997.
7 Letter from Richard J. Nelson to Barbara C. Weddle, dated
September 12, 1997.
8 Letter from Richard J. Nelson to B.L. Rakes, dated September 13,
1997.
9 Letter from B.L. Rakes to Richard J. Nelson, dated September 15,
1997.
10 Letter from Richard J. Nelson to B.L. Rakes, dated September 16,
1997.
11 Letter from Cede & Co. (on behalf of Mr. Nelson) to Barbara
Weddle, dated September 17, 1997.
12 Letter from B.L. Rakes to Richard J. Nelson, dated September 18,
1997.
13 Letter from B.L. Rakes to Richard J. Nelson, dated September 19,
1997.
14 Letter from Richard J. Nelson to B.L. Rakes, dated September 22,
1997.
15 Letter from B.L. Rakes to Richard J. Nelson, dated September 24,
1997.
16 Letter from Theodore J. Craddock to B.L. Rakes, dated September
26, 1997.
17 Letter from B.L. Rakes to Theodore J. Craddock, dated September
26, 1997.
18 Letter from Richard J. Nelson to B.L. Rakes, dated September 26,
1997.
19 Letter from B.L. Rakes to Richard J. Nelson, dated September 26,
1997.
20 Letter from Richard J. Nelson to Glen C. Combs, dated September
27, 1997.
21 Letter from B.L. Rakes to Richard J. Nelson, dated September 29,
1997.
22 Letter from Theodore J. Craddock to B.L. Rakes, dated October 1,
1997.
______
*Previously filed with the SEC as part of the Original 13D.
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true,
complete and correct.
Date: October 3, 1997
/s/ Richard J. Nelson
Richard J. Nelson
Exhibit 2 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LA SALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
----
(616) 344-4993
October 1, 1997
Mr. John L. Hart, Chairman
c/o Ms. Barbara C. Weddle, Secretary
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Dear Mr. Hart: VIA FEDERAL EXPRESS
After sending a letter dated September 27, 1997 to members of the Board of
Directors, I received from SWVA Bancshares, Inc. (the "Company") the
Shareholders of Record listing and copies of certain excerpts from recent
meetings of the Board of Directors. This information does not satisfy the
lawful demand for inspection of books and records made to the Company by
my agents, and I intend to continue to seek the information to which I am
entitled.
I am convinced that a majority of shareholders of the Company would like
to see the Board of Directors fully explore a merger with a larger, more
profitable, shareholder friendly institution. Due to the Board's decision
to accelerate the Annual Meeting date and the unnecessary delay in
providing me with the shareholder listing and other information to which I
am entitled, there is not enough time for me to give shareholders a choice
to elect a new, independent, qualified individual to the Board of
Directors. I am, therefore, withdrawing my notice of intent to nominate
Dewey W. Chapple, Jr. for election to the Board of Directors of SWVA
Bancshares, Inc. at the 1997 Annual Meeting of Shareholders.
I intend to continue to communicate with shareholders and discuss the
operations, strategies, performance and actions of the Company. I will
ask other shareholders to communicate their thoughts and concerns directly
to the Board of Directors. Shareholders are more aware than you may think
of the fact that the Directors' fiduciary responsibilities are to
represent shareholders' interests first and foremost, as clearly
determined by the courts.
Based on the Company's low return on equity, lack of growth prospects, and
recent banking combinations in and around Virginia, I feel that the
Company has an obligation to consider and evaluate formal and informal
expressions of interest and offers to discuss merger possibilities.
Regarding such contacts that may have been made by financial institutions
to Mr. Rakes, has the Board of Directors fully deliberated such overtures,
or has the Board dismissed them out of hand? Has the Board of Directors
discussed the appointment of a special committee of outside Directors to
formulate a procedure for fulfilling the Board's fiduciary duties in these
matters? Does the Board retain outside financial advisors to evaluate
formal and informal offers and to advise the Board regarding even
preliminary discussions of a business combination or merger? Also, why
did the Board decide to hold the Annual Meeting two and one-half weeks
earlier than normal? Certainly the owners of the Company have an interest
in and a right to receive answers to the above questions.
Please share this letter with the full Board of Directors, and I look
forward to your response.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
cc: Ms. Barbara C. Weddle
Senior Vice President and Secretary
SWVA Bancshares, Inc.
Exhibit 3 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
Cede & Co.
c/o The Depository Trust Company
7 Hanover Square
New York, New York 10004
September 10, 1997
Barbara C. Weddle
Secretary
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24001-1597
Re: Inspection of Books and Records Including a Stocklist of SWVA
Bancshares, Inc. Pursuant to Article 18, Sections 13.1-770,
13.1-771 and 13.1-772 of the Virginia Stock Corporation Act
Dear Ms. Weddle:
Cede & Co., the nominee of The Depository Trust Company ("DTC"), is a
holder of record of shares of common stock (the "Common Stock") of SWVA
Bancshares, Inc., a Virginia corporation (the "Company"). DTC is informed
by its Participant, J.C. Bradford & Co. ("Participant") that on the date
hereof, 26,000 of such shares (the "Shares") credited to Participant's DTC
account are beneficially owned by Richard J. Nelson, a customer of the
Participant (the "Customer").
Pursuant to Sections 13.1-770, 13.1-771 and 13.1-772 of the Virginia Stock
Corporation Act, at the request of the participant and on behalf of the
Customer, Cede & Co., as record holder of the Shares, hereby demands the
right (by attorney or other agent), during the usual hours for business,
to inspect the following books, records, and other documents of the
Company (the "Books and Records") and to make copies or extracts
therefrom:
With respect to the election of directors at the 1997 Annual
Meeting of Stockholders of the Company and any recommendations
or communications from shareholders regarding such nominations
or election of directors, excerpts from minutes of any meeting
of the board of directors and records of any action or
discussion by a committee of the directors while acting in place
of the board of directors on behalf of the Company.
Pursuant to Section 13.1-770, 13.1-771 and 13.1-772 of the Virginia Stock
Corporation Act, at the request of the Participant and on behalf of the
Customer, Cede & Co., as record holder of the Shares, hereby demands the
right (by attorney or other agent), during the usual hours for business,
to inspect the following Stocklist Materials currently in possession of
the Company and/or its agents, and updated as of the record date for the
1997 Annual Meeting of Stockholders of the Company, and to make copies or
extracts therefrom:
1. The most recent record of Company shareholders, including names and
addresses of all shareholders, in alphabetical order by class and series,
if any, of shares showing the number and class and series, if any, of
shares held by each;
2. All information in the Company's or its agent's possession and/or
subject to its direction or control and/or which can be obtained from
nominees of any central depository system, relating to the breakdown of
all brokerage and financial institutions holding shares for their
customers in street name and a breakdown of holdings which appear on the
corporate stock ledger under names of my central depository system (e.g.,
Cede & Co.);
3. A list of the names, addresses and securities positions of non-
objecting beneficial owners and acquiescing beneficial owners obtained by
the Company from brokers and dealers pursuant to the applicable rules
promulgated under the Securities Exchange Act of 1934, as amended; and
4. A list of the names and addresses of employees of employee
participants in any stock ownership plan of the Company as of the date of
the stockholder list.
In addition to the above, please provide the following Stocklist Materials
currently in the possession of the Company and /or its agents, and updated
as of the record date for the 1997 Annual Meeting of Stockholders of the
Company;
A. The Pershing/DLJ omnibus proxy list;
B. The Philadep omnibus proxy list;
C. Any other omnibus proxies produced by ADP for client banks or
brokers, listing among other things any respondent positions;
D. Any omnibus proxy produced by Bank of New York, or any other
bank or broker, listing among other things any respondent
positions; and
E. Any record date information provided by ADP relative to the
shares held for their clients, and the number of holders at each
of their client firms hold SWVA Bancshares, Inc. shares.
Cede & Co. has been advised by the participant that the purposes of this
demand for the Stocklist Materials and Books and records are (1) to enable
the Customer to communicate with stockholders regarding their investment
as stockholders and (2) to communicate with stockholders regarding a
possible proxy contest of consent solicitation.
Cede & Co. has been advised by the Participant that the Customer will bear
the reasonable costs incurred by the Company, including the cost of its
transfer agent(s) or registrar(s) in connection with the production of the
information demanded with respect to the above-described Books and Records
and Stocklist Materials.
Please advise Richard J. Nelson, 350 E. Michigan Avenue, Suite 500,
Kalamazoo, MI 49007, telephone (616) 344-4993, where and when the Books
and Records and the Stocklist Materials will be available.
The undersigned hereby authorizes Dewey W. Chapple, Jr., and the law firms
of Foley and Lardner, and Morris, Nichols, Araht & Tunnel, and their
respective partners, associates, employees and any other person to be
designated by them, acting together, singly or in combination, to conduct
the inspect and copying herein demanded.
While Cede & Co. is furnishing the demands stated herein as the
stockholder of record of the Shares, it does so at the request of
Participant and only as a nominal party for the true party in interest,
the Customer. Cede & Co. has no interest in this matter other than to
take those steps which are necessary to ensure that the Customer. Cede &
Co. has no interest in this matter other than to take those steps which
are necessary to ensure that the Customer is not denied its rights as the
beneficial owner of the Shares, and Cede & Co. assumes no further
responsibility for this matter.
Very truly yours,
Cede & Co.
By: /s/ John L. Scheuermann
John L. Scheuermann, Partner
<PAGE>
STATE OF NEW YORK )
) SS.
COUNTY OF NEW YORK )
John L. Scheuermann, having been first duly sworn according to law,
deposes and says that he(she) is a partner of Cede & Co., that he(she) is
authorized to execute the foregoing demand for a stocklist and corporate
books and record and to make the demand designations, authorizations and
representations contained therein, and that the facts and statements
contained in the foregoing are true and correct.
Cede & Co.
By: /s/ John L. Scheuermann
John L. Scheuermann, Partner
SWORN TO AND SUBSCRIBED before me
this 17th day of September, 1997.
/s/ Sue Ann Vajda
Notary Public
Exhibit 4 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LASALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
September 12, 1997
B.L. Rakes, President
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Dear Mr. Rakes: VIA FACSIMILE
Since you have not responded to my numerous recent messages, I am writing
this letter to request that you immediately make arrangements to comply
with the Cede & Co. demand for Stocklist Materials and Books and Records
of SWVA Bancshares, Inc. (the "Company").
Regarding the upcoming 1997 Annual Meeting of Stockholders (the
"Meeting"), it appears that you have accelerated the Meeting date in order
to disenfranchise shareholders from exercising their rights, as those
rights are enumerated in the Company's own Bylaws and Restated Articles of
Incorporation, and the Virginia Stock Corporation Act. It is also
interesting to note that following the Board of Directors meeting on
September 3, 1997, you immediately issued a news release regarding the
$1.00 per share special dividend and disclosing the September 15, 1997
record date for the special dividend, but did not disclose the date of the
Annual Meeting or the September 5, 1997 record date for voting at the
Meeting.
I'm sure you recall that a few days ago when I asked you for the dates set
by the Board of Directors for the Meeting and the record date for
shareholders to vote at the Meeting, you told me that the dates have not
been "confirmed." When I then asked if you would let me know when those
dates have been "confirmed," you said that you probably could not do so,
but you would check and let me know. On September 11, 1997 the Company
filed preliminary proxy materials that does not acknowledge my Notice of
Nomination provided to you on September 10, 1997, thereby ignoring the
fact that shareholders may have a chance to vote for a non-management
endorsed candidate for the Board of Directors.
It is still not clear to me why the Company will not agree to endorsing
the nomination of an independent, experienced, qualified individual for
election to the Board of Directors. It is even less clear as to why the
Company found it necessary to advance the date of the Annual Meeting,
thereby making it extremely difficult for the shareholders to be given the
opportunity to exercise their right of choice should a non-management
candidate run for election to the Board of Directors. Does the Board
believe that it is a wise decision to employ these tactics which appear to
simply be attempts at management entrenchment? It is properly fulfilling
the Board's fiduciary responsibilities to expend Company (and therefore
shareholder) resources to try to prevent my proposed nominee, whom you
declined to even interview, from being elected to the Board of Directors?
It is my understanding that the Cede & Co. demand was delivered to you by
facsimile transmission on September 11, 1997. I again request that you
contact me immediately to arrange for delivery of the documents or
inspection by my agent, as the delivery or inspection is required no later
than September 16, 1997. Due to the accelerated Meeting date, I further
request that the materials be delivered to me no later than September 13,
1997.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
RJN:wp
Exhibit 5 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
September 12, 1997
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 East Michigan Avenue
Kalamazoo, MI 49007
Dear Mr. Nelson:
Please be advised that your notice of intent to nominate Dewey W. Chapple,
Jr. for election as a director of SWVA Bancshares, Inc. (the corporation)
at the 1997 Annual Meeting of Stockholders of the Corporation was received
September 11, 1997.
Very truly yours,
/s/ B.L. Rakes
B.L. Rakes
President
Exhibit 6 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
SWVA
Bancshares, Inc.
September 12, 1997
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 E. Michigan Avenue
Kalamazoo, MI 49007
VIA FACSIMILE
RE: Delivery of documents or inspection
Dear Mr. Nelson:
We have received your correspondence. Your request for inspection must
comply with Virginia Stock Corporation Act Section 13.1 771A.
At such time as we receive proper notice, we will advise you if your
request is sufficient.
Very truly yours,
/s/ B.L. Rakes
B.L. Rakes
President
mgs
Exhibit 7 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LASALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E Michigan Avenue
Kalamazoo, Michigan 49007
(616) 344-4993
September 12, 1997
Barbara C. Weddle
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Dear Ms. Weddle:
Regarding Mr. Rakes' letter to me dated September 12, 1997, I hereby give
notice and demand to inspect, on September 19, 1997, the Stocklist
Materials and Books and Records as listed in the Cede & Co. letter to you
dated September 10, 1997.
As Mr. Rakes' letter acknowledges that the demand to inspect and copy the
Stocklist Materials and Books and Records was actually my request, made
through Cede & Co. and J.C. Bradford & Co., the insertion of the date
above should fully comply with the Company's compliance request.
By providing the date for inspection, however, this letter in no way
implies that the original demand for inspection made by Cede & Co. was
deficient in any way. I will have Cede & Co. resubmit their request.
However, the Company's failure to provide the inspection and copying of
the requested documents by the appropriate time period according to the
September 10, 1997 letter from Cede & Co., will be deemed to be non-
compliance with the duly submitted request.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
RJN:wp
Exhibit 8 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LASALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
September 13, 1997
B.L. Rakes, President
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Dear Mr. Rakes:
After taking some time to further review your September 12, 1997 letter to
me regarding "delivery of documents or inspection," I find that the
message contained in the letter is unclear and ambiguous.
You indicate that you have received my correspondence. To which
correspondence are you referring? You then state that my request for
inspection must comply with Section 13.1-771A. of the Virginia Stock
Corporation Act. Let me address that point by point:
1. The reference to subsection C of Section 13.1-772 regarding the
payment of reasonable costs by the shareholder has been clearly
agreed to in the Cede & Co. September 10, 1997 Demand for
inspection of Books and Records Including a Stocklist (the
"Demand");
2. The reference to subsection E of Section 13.1-770 only pertains
to the Demand in that the Demand requests certain information
which might vaguely be included under Section 13.1-770E.5. It
should be noted however, that the Demand is made for minutes of
board meetings "with respect to" shareholder communications, not
for copies of the actual communications;
3. If your September 12, 1997 letter is in reference to whether or
not I am a "shareholder," J.C. Bradford & Co. and Cede & Co.
have attested to that fact, and I enclose a copy of J.C.
Bradford & Co.'s request to Cede & Co.;
4. Finally, if your statement regarding compliance with Section
13.1-771A. concerns the fact that the Demand did not indicate a
specific date for inspection and copying, I correct my statement
in my first September 12, 1997 letter to you. Properly counting
"business days," inspection or delivery must be accomplished by
the end of business on Wednesday, September 18, 1997. Due to
the accelerated Annual Meeting date, I reiterate my request that
the material be delivered to me immediately. Also, while a
specific date for inspection was not contained in the Demand, I
have now made it clear that a proper reading and understanding
of the Demand is that under normal circumstances the shareholder
expects inspection to take place no earlier than five business
days from the receipt of the Demand.
You indicate in your September 12, 1997 letter that you will advise if my
request is sufficient, at such time as you receive proper notice. To
which "notice" and "request" are you referring? Does this mean that you
believe you have not received "proper notice?' Are you going to object to
items in the Demand piecemeal, in order to delay complying with the
Demand?
It is very unfortunate that you are going to great lengths to resist the
duly submitted Demand by creating confusion with your vague and unclear
letter of September 12, 1997. I am making every effort to comply with the
proper procedures under the Virginia Stock Corporation Act, and believe
that I have done so at this time. If you still believe that the Demand
for Books and Records regarding "recommendations or communications from
shareholders" contained in the second paragraph of the Demand is not in
compliance, I hereby withdraw that paragraph.
Please call me after you receive this letter. At this point it would be
beneficial to discuss these communications and clear up any ambiguities.
If you would also provide the name of your attorney in this matter, I will
have my attorney call him or her to further clarify any misunderstandings.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
RJN:wp
Enclosure
cc: Barbara C. Weddle
Senior Vice President and Secretary
Exhibit 9 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
September 15, 1997
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 E Michigan Avenue
Kalamazoo, MI 49007
VIA FACSIMILE
Dear Mr. Nelson:
As we previously wrote to you by letter dated September 12, 1997, your
request for inspection under the Virginia Stock Corporation Act must
comply with Section 13.1-771 A of that act. As you wrote in your letter
to me dated September 13, 1997, "a specific date for inspection was not
contained in the Demand . . ."
Today is September 15, 1997 and we have not received written notice of
your demand to inspect and copy documents at least five business days
before the date on which you wish to visit. Please do not telecopy
letters to us on Saturday or Friday night after 5:00 p.m. and expect that
we will be here at that time to receive them. Also, we cannot understand
how you can write a letter in one week, revise it the next week and say
that SWVA Bancshares, Inc. had notice of the revision at the time the
earlier letter was sent.
Mr. Nelson, you have to write us when you want to visit since we don't
know your schedule. Please give us at least five business days notice
before the date you intend to visit.
In reference to your telephone message in which you requested the name of
our attorney, we prefer all communication in this matter be made with this
office.
Very truly yours,
/s/ B.L. Rakes
B.L. Rakes
President
Exhibit 10 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LA SALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
----
(616) 344-4993
September 16, 1997
B.L. Rakes, President
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Dear Mr. Rakes: VIA FACSIMILE
Thank you for your letter of September 15, 1997. I hope you understand
that the confusion results from the fact that I must rely on Cede & Co.
and J.C. Bradford & Co. to execute and deliver certain documents relative
to the Demand for Stocklist Materials and Books and Records. I do not
know on what date the Demand will actually be delivered to you.
My September 12, 1997 letter replied to your indication that I had not
given proper notice, by citing September 19, 1997 as the inspection date.
I subsequently learned that we must use five "business" days. The new
Cede & Co. letter requests inspection on September 22, 1997, as I believed
that the new Demand would be received by you on September 15, 1997. In
the event that the new Demand is not delivered on the 15th, I included "or
as soon as permissible" language in the letter.
I had hoped that you would have been more cooperative in working out these
arrangements, and in fact, I still hope that you will work with me to
allow the shareholders a chance to exercise their right of choice. It
should be clear now that I wish to have my agent inspect and copy the
requested materials as soon as permissible after the five day period. If
the new Demand letter was received by you on September 16, 1997, I will
inspect and copy the materials on September 23, 1997. If the new Demand
is not received by you until a later date, I will inspect five business
days after that date of receipt. I would also hope that you would
cooperate by arranging to have the material sent to me by overnight
express, with expenses to be paid by me. I will call you to work out the
details.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
Exhibit 11 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
September 17, 1997
Barbara C. Weddle
Secretary
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Re: Inspection of Books and Records Including a Stocklist of SWVA
Bancshares, Inc., Pursuant to Article 18, Section 13.1-770, 13.1-771
and 13.1-772 of the Virginia Stock Corporation Act
Dear Ms. Weddle:
Cede & Co., the nominee of the Depository Trust Company ("DTC"), is a
holder of record of shares of common stock (the "Common Stock") of SWVA
Bancshares, Inc., a Virginia corporation (the "Company"). DTC is informed
by its Participant, J.C. Bradford & Co. ("Participant") that on the date
hereof, 26,000 of such shares (the "Shares") credited to Participant's DTC
account are beneficially owned by Richard J. Nelson, a customer of the
Participant (the "Customer").
Pursuant to Sections 13.1-770, 13.1-771 and 13.1-772 of the Virginia Stock
Corporation Act, at the request of the Participant and on behalf of the
Customer, Cede & Co., as record holder of the Shares, hereby demands the
right (by attorney or other agent), during the usual hours of business, on
September 24, 1997 or as soon as permissible, to inspect the following
books, records, and other documents of the Company (the "Books and
Records") and to make copies or extracts therefrom:
Excerpts from minutes of any meeting of the board of
directors and records of any action or discussion by a
committee of the board of directors while acting in
place of the board of directors on behalf of the
Company, with respect to the election of directors at
the 1997 Annual Meeting of Stockholders of the Company
and any recommendations or communications from
shareholders regarding such nominations or election of
directors.
Pursuant to Sections 13.1-770, 13.1-771 and 13.1-772 of the Virginia Stock
Corporation Act, at the request of the Participant and on behalf of the
Customer, Cede & Co., as record holder of the Shares, hereby demands the
right (by attorney or other agent), during the usual hours for business,
on September 22, 1997 or as soon as permissible, to inspect the following
Stocklist Materials currently in possession of the Company and/or its
agents, and updated as of the record date for the 1997 Annual Meeting of
Stockholders of the Company, and to make copies or extracts therefrom;
1. The most recent record of Company shareholders, including names and
addresses of all shareholders, in alphabetical order by class and series,
if any, of shares showing the number and class and series, if any, of
shares held by each;
2. All information in the Company's or its agent's possession and/or
subject to its direction or control and/or which can be obtained from
nominees of any central depository system, relating to the breakdown of
all brokerage and financial institutions holding shares for their
customers in street name and a breakdown of holdings which appear on the
corporate stock ledger under names of any central depository system (e.g.,
Cede & Co.):
3. A list of the names, addresses and securities positions of non-
objecting beneficial owners and acquiescing beneficial owners obtained by
the Company from brokers and dealers pursuant to the applicable rules
promulgated under the Securities Exchange Act of 1934, as amended; and
4. A list of the names and addresses of employee participants in any
stock ownership plan of the Company as of the date of the stockholder
list.
In addition to the above, please provide the following Stocklist Materials
currently in the possession of the Company and/or its agents, and updated
as of the record date for the 1997 Annual Meeting of Stockholders of the
Company;
A. The Pershing/DLJ omnibus proxy list;
B. The Philadep omnibus proxy list;
C. Any other omnibus proxies produced by ADP for client banks or
brokers, listing among other things any respondent positions;
D. Any omnibus proxy produced by Bank of New York, or any other
bank or broker, listing among other things any respondent
positions; and
E. Any record date information provided by ADP relative to the
shares held for their clients, and the number of holders at each
of their client firms holding SWVA Bancshares, Inc. shares.
Cede & Co. has been advised by the Participant that the purposes of this
demand for the Stocklist Materials and Books and Records are: (1) to
enable the Customer to communicate with stockholders regarding their
investment as stockholders and (2) to communicate with stockholders
regarding a possible proxy contest or consent solicitation.
Cede & Co. has been advised by the Participant that the Customer will bear
the reasonable costs incurred by the Company, including the costs of its
transfer agent(s) or registrar(s) in connection with the production of the
information demanded with respect to the above-described Books and Records
and Stocklist Materials.
Please advise Richard J. Nelson, 350 E. Michigan Avenue, Suite 500,
Kalamazoo, MI 49007, telephone (616) 344-4993, where and when the Books
and Records and the Stocklist Materials will be available.
The undersigned hereby authorizes Dewey W. Chapple, Jr. and the law firms
of Foley and Lardner and Morris, Nichols, Arsht & Tunnel, and their
respective partners, associates, employees and any other persons to be
designated by them, acting together, singly or in combination, to conduct
the inspection and copying herein demanded.
While Cede & Co. is furnishing the demands stated herein as the
stockholder of record of the Shares, it does so at the request of
Participant and only as a nominal party for the true party in interest,
the Customer. Cede & Co. has no interest in this matter other than to
take those steps which are necessary to ensure that the Customer is not
denied its rights as the beneficial owner of the Shares, and Cede & Co.
assumes no further responsibility for this matter.
Very truly yours,
Cede & Co.
/s/ John Scheuermann
By: John Scheuermann
Partner
<PAGE>
STATE OF NEW YORK )
) SS.
COUNTY OF NEW YORK )
John Scheuermann, having been first duly sworn according to law,
deposes and says that he (she) is a partner of Cede & Co. that he (she) is
authorized to execute the foregoing demand for a stocklist and corporate
books and record and to make the demand designations, authorizations and
representations contained therein, and that the facts and statements
contained in the foregoing are true and correct.
Cede & Co.
/s/ John Scheuermann
By: John Scheuermann
SWORN TO AND SUBSCRIBED before me this
17th day of September, 1997
Sue Ann Vajda
Notary Public
Exhibit 12 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
SWVA
Bancshares, Inc.
September 18, 1997
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 E. Michigan Ave.
Kalamazoo, MI 49007
VIA FACSIMILE
Dear Mr. Nelson:
As of this writing, we have not received the "new Cede & Co. letter"
referenced in your letter dated September 16, 1997. But, we now
understand why your earlier letters referred to different dates for
inspection. Hopefully a new letter from them will solve the problem.
However, regardless of whether Mr. Chapple or your lawyers visit us to
inspect documents, we thought you should know that if you decide to
solicit proxies by mail, we will mail your material. We will ask that you
provide us with postage or payment for postage and other expenses for your
mailing at the time you provide us with your material.
We have approximately 236 record holders and estimate that we have an
additional 250-300 beneficial holders who are not record holders. These
additional beneficial holders hold their shares through nominees, such as
brokers, who maintain an account for each beneficial owner that is a
nominee's client.
For these 236 record holders, our transfer agent has told us it would
charge $100 to prepare the proxy records for mailing and $100 to mail two
additional documents (such as a proxy statement and a return envelope).
Postage for 236 mailings would be 32 cents ($75.52) for up to one ounce
and 55 cents ($129.80) for less than 2 ounces. For the 250-300 additional
beneficial owners, there would be a $20 per nominee charge for each of
about 25 nominees ($500) plus approximately $1.45 additional cost for each
account (approximately $362 to $435).
The printing costs will vary on how much you print, although cost is not
exactly proportional to quantity. Our printer estimated that you would
have the following printing expenses: $120 for 350 mailing envelopes (9"
x 12"), $65 for 350 return envelopes, $345 for 600 proxy sheets and $1,135
for 1,200 copies of a proxy statement.
We know you would rather have all of the material you are entitled to sent
to you without making your lawyers or Mr. Chapple visit us, but we think
Mr. Chapple might want to visit so he can see if he wants to serve a as
director and travel such a great distance for each meeting.
Very truly yours,
/s/ B.L. Rakes
B.L. Rakes
President
mgs
Exhibit 13 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
SWVA
Bancshares, Inc.
September 19, 1997
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 E Michigan Avenue
Kalamazoo, MI 49007
VIA FACSIMILE
Dear Mr. Nelson:
After we sent our letter to you dated September 18, 1997, a letter from
Cede & Co. dated September 17, 1997 arrived at our office. As a result,
we will expect Mr. Chapple or your lawyers to visit us on September 25,
1997.
Very truly yours,
/s/ B.L. Rakes
B.L. Rakes
President
mgs
Exhibit 14 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LA SALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
___________
(616) 344-4993
September 22, 1997
B.L. Rakes, President
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Dear Mr. Rakes: VIA FACSIMILE
Please confirm that all of the information cited in the demand letter from
Cede & Co. will be available for inspection by my representative on
September 25, 1997 and that you will have an area available for the
inspection and copying, and that a copier will be readily available. My
legal representatives at Foley and Lardner will designate a local law firm
to make the inspection and copies, and you will be provided with an
authorization to that effect.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
Exhibit 15 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
SWVA
Bancshares, Inc.
September 24, 1997
VIA FACSIMILE 616-382-2382
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 E. Michigan Avenue
Kalamazoo, MI 49007
Dear Mr. Nelson:
This is a response to your letter dated September 22, 1997 that we
received less than an hour before the close of business of September 22,
1997. At this time we cannot make the confirmation that you have
requested but we wish to explain why this is so. The letters from Cede &
Co. are difficult to understand and take time to review. We have been
getting more documents as we decide you are entitled to them, but that
also takes time. Because of the delay you had in getting the necessary
second letter from Cede & Co. to us, we did not immediately procure
documents.
We will be certain to have what you are entitled to review on Thursday,
September 25, 1997. We could have more information for you on Friday or
Monday than on Thursday but you may not wish to wait an extra day for more
information. Also we probably agree that you would rather not have your
lawyers make more than one trip to look at documents. However, if you are
willing to visit on Friday or Monday instead of Thursday, we promise to
advise you on Thursday what documents you would see on Friday or Monday
and you can decide which day would be better for you, based on what you
would see. We are not saying whether it would be better to wait a day to
see if there will be more documents but, if we do not receive a response
from you, we will assume that your lawyers will visit us on Thursday.
Very truly yours,
/s/ B.L. Rakes
B.L. Rakes
President
BLR:bw
Exhibit 16 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
CASKIE & FROST
A Professional Corporation
ATTORNEYS AT LAW
2306 ALTHERHOLT ROAD
PLEASE REPLY TO: P. O. BOX 24505
LYNCHBURG, VIRGINIA 24505
September 26, 1997
Mr. B. L. Rakes, President
SWVA Bancshares, Inc.
302 2nd Street, SW
Roanoke, VA 24011-1597
Re: Copies of corporate records
Dear Mr. Rakes:
Pursuant to my telephone conversation with you, and our paralegal
Kelly Feagans' conversations with you yesterday in the offices of SWVA
Bancshares, Inc., this is to confirm that you have refused to comply with
the provisions of Section 13.1-771 and 13.1-772 of the Virginia Stock
Corporation Act. We provided you this morning with the attached
correspondence, which includes the letter dated September 17, 1997 from
Cede & Co. directed to Barbara C. Weddle, Secretary of SWVA Bancshares,
Inc., your letter of September 19, 1997 directed to Mr. Richard J. Nelson
confirming that you will expect us September 25, 1997, and Foley &
Lardner's letter directed to me dated September 24, 1997 authorizing
Caskie & Frost and our agents to represent Mr. Nelson in connection with
obtaining the corporate records set forth in the letter of Cede & Co.
dated September 17, 1997.
Contrary to our request, and the provisions of Sections 13.1-771 and
13.1-772 of the Code of Virginia, you have refused to provide our agent
with copying rights as provided in the Virginia Code. You have stated
that you would neither provide copying equipment for us, nor would allow
us to bring copying equipment into the bank, nor would you allow us to
take the records to have them copied, nor would you provide us with copies
of the records. We have offered to pay the reasonable charge of the
copies.
You have had substantial time to prepare for the stockholder request
for information. You knew that representatives of Mr. Nelson would be
appearing at your bank September 25, and yet you have intentionally
prevented a shareholder from making a reasonable inspection and copies as
provided under Virginia law.
I draw your attention to Section 13.1-773 of the Code of Virginia,
which provides for court ordered inspection, and provides that if the
shareholder proves that the corporation refused inspection without a
reasonable basis, that the corporation shall pay the shareholder costs,
including reasonable attorney's fees incurred to obtain the order. From
your correspondence, your conversation with me, and your treatment of our
paralegal in your office, it is apparent that you simply do not wish to
allow Mr. Nelson his rights under Virginia law.
I asked you to provide us with your attorney's name and number, and
you have declined to do that as well. As a result, our client is
considering instituting an action to obtain a court order directing you to
comply with the Virginia statutes aforesaid and may seek to postpone the
accelerated meeting of the shareholders.
Very truly yours,
CASKIE & FROST, P.C.
By: /s/ Theodore J. Craddock
Theodore J. Craddock
TJC/ahd
Enclosure
Cc: Phillip M. Goldberg, Esquire
Mr. Richard J. Nelson
Mr. Glen C. Combs
Mr. James H. Brock
Mr. John L. Hart
Mr. F. Courtney Hoge
Mr. Michael M. Kessler
Exhibit 17 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
SWVA
Bancshares, Inc.
September 26, 1997
Theodore J. Craddock, Esquire
Caskie & Frost
P. O. Box 6360
Lynchburg, VA 24505
VIA FACSIMILE
Dear Mr. Craddock:
I am in receipt of your letter dated September 26, 1997 regarding your
request for copies of certain corporate records of SWVA Bancshares, Inc.
I want to again extend my offer as conveyed to you and Ms. Feagans
verbally yesterday (September 25). We will be happy to copy the documents
that you are entitled to under Virginia law. As you can well understand,
we cannot allow non-employees of the Bank access to our equipment.
If you agree to this offer, please contact me as soon as practicable (no
later than 2:00 p.m.) so we can begin copying.
Furthermore, please provide me with a federal express address where such
documents can be sent. In the alternative, you can send someone over any
time between 4:00 and 5:00 p.m. today to pick up the copies. We will bill
you for the reasonable charges.
I trust this addresses your concerns.
Very truly yours,
/s/ B.L. Rakes
B. L. Rakes
President
mgs
Exhibit 18 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LA SALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
(616) 344-4993
September 26, 1997
Mr. B. L. Rakes, President
SWVA Bancshares, Inc.
302 Second Street, S.W.
Roanoke, VA 24011-1597
Dear Mr. Rakes:
This is to confirm the substance of our 4:15 PM telephone conversation
today.
You agreed to Fed Ex to me only the shareholder list and some excerpts
from Board meeting minutes. You indicated to me that under Virginia law
that is only what I am entitled to receive and you would not comply with
the demand for the other records and lists. When I asked if you are in
possession of a Non-Objecting Beneficial Owner listing and other requested
documents, such as the Cede & Co. broker listing, you refused to answer
except to say that you are providing only what is required under Virginia
law.
I then asked if you would provide the name of your attorney in this
matter, and you refused, stating that I should put the request for his
name in writing and fax or send it to you. You said, however, you could
do nothing with it today.
I further inquired whether the members of the Board of Directors received
a copy of Mr. Craddock's letter dated today, and you said you assumed so.
I asked if you have been in contact with your Board members regarding this
matter, and you said you have been in contact with "one or two of them."
Finally, I suggested that your Board may be hearing from my attorney
again, and hoped that they would be represented by counsel whose name
could be made known to us.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
Exhibit 19 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
SWVA
Bancshares, Inc.
September 26, 1997
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 E. Michigan Avenue
Kalamazoo, MI 49007
Dear Mr. Nelson:
Please find enclosed copies of the documents that you are entitled to
under Virginia law.
Very truly yours,
/s/ B.L. Rakes
B. L. Rakes
President
Mgs
Exhibit 20 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
LA SALLE CAPITAL MANAGEMENT, INC.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
(616) 344-4993
September 27, 1997
Mr. Glen C. Combs
Acosta Sales
3308 Franklin Road, S.W.
Roanoke, VA 24011
Dear Mr. Combs:
I am enclosing copies of all of the correspondence between Bill Rakes and
me, with the hope that you will read through these documents to fully
understand the situation at SWVA Bancshares. I am sorry to have to
contact you in this way, as I would have preferred to continue to deal
with Mr. Rakes. It is not my style or intent to go around the President
and CEO, however this may be the only way to prevent a contentious and
costly (for both sides) lawsuit, which would certainly include the members
of the Board of Directors.
I have sat on the Boards of Directors of three savings institutions, and I
have never seen nor encountered such flagrant disregard of the rights of
shareholders in general, and the largest shareholder of a public company,
in particular. I cannot believe that Mr. Rakes is acting with the full
knowledge and approval of the members of the Board of Directors. If the
Board of Directors is fully informed and has approved of these actions we
will just have to settle these issues after further consultation with my
attorneys and advisors. If you have not been fully informed and have not
approved of Mr. Rakes actions against the shareholders, the Company and
the Board have serious problems.
I will be in my office Monday morning, and would appreciate a call from
you as soon as possible. If I do not hear from you by Noon Monday,
September 29th, and my attorneys agree, we will file the lawsuit by the
end of the day Monday, asking the Court to compel SWVA Bancshares to
deliver the documents to which we are entitled and postpone the Annual
Meeting. Please be aware that I have requested that Mr. Rakes provide the
name of the Company's attorney so we can attempt to work this out
amicably, and he has refused. Is the Board of Directors represented by
counsel, and will you provide me with his or her name?
I would have liked to send this to all of the Directors, but there just
isn't time. I would hope that you would speak to them and your own legal
counsel. I don't mean to place unreasonable deadlines on you, but we have
exhausted all other remedies and time is short. I look forward to hearing
from you and working with you to solve these issues.
Sincerely,
/s/ Richard J. Nelson
Richard J. Nelson
Enclosures
cc: Phillip Goldberg, Foley & Lardner
Theodore J. Craddock, Caskie & Frost
Exhibit 21 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
SWVA
Bancshares, Inc.
September 29, 1997
Mr. Richard J. Nelson
LaSalle Capital Management, Inc.
Suite 500
350 E. Michigan Avenue
Kalamazoo, MI 49007
VIA FACSIMILE
Dear Mr. Nelson:
On Saturday, you should have received a package sent to your home, using
the Federal Express number you gave us, that includes the list of
stockholders and excerpts of minutes of meetings that you have requested.
However, Mr. Combs provided me today with a copy of a letter dated
September 27, 1997 from you that threatens the filing of a lawsuit today
and alleges misconduct. Your lawyer, Mr. Craddock, has sent us a letter
dated September 26, 1997 that threatens a lawsuit and contains numerous
misstatements. Further, your letter dated September 26, 1997 states that
we will hear from your attorney again. If you have not received the
documents that we said we would send (the same documents available at our
office since September 25, 1997), please contact us immediately.
Mr. Nelson, as we have told you and Mr. Craddock numerous times, you are
entitled to certain documents under Virginia law and we are required to
make them available to you. We have done that and we do not understand
why you and your lawyers are threatening us with lawsuits and alleging
misconduct. We have read the sections of the Virginia law that you and
your lawyers have cited (Sections 13.1-661, 13.1-770, 13.1-771, 13.1-772
and 13.1-773) but believe you must have other sections you have not told
us about. Please show us where we have failed to comply with Virginia law
and we will correct it immediately. If you do not have these sections of
Virginia law, we will telecopy them to you.
Very truly yours,
/s/ B.L. Rakes
B. L. Rakes
President
mgs
Exhibit 22 to 13D
Amendment No. 1
SWVA Bancshares, Inc.
CASKIE & FROST
A Professional Corporation
ATTORNEYS AT LAW
2306 Atherholt Road
Please Reply To: P.O. Box 6360
Lynchburg, Virginia 24505
October 1, 1997
BY TELEFAX
Mr. B.L. Rakes, President
SWVA Bancshares, Inc.
302 2nd Street, SW
Roanoke, VA 24011-1597
Re: Copies of corporate records
Dear Mr. Rakes
Mr. Richard Nelson faxed me a copy of your letter dated
September 29, 1997. You have stated that my letter of September 26
contains numerous misstatements. You very well know that there are no
misstatements in my letter of September 26. I spoke to you on the morning
of September 25th. I have not spoken with you numerous times. You never
told me that Mr. Nelson was entitled to any documents under Virginia law.
In fact, you refused to provide our agent with the copying rights as
provided under the Virginia Code.
Only after my letter of September 26th was faxed to you and the
other Directors of the bank, did you make any attempt to comply with the
reasonable stockholder request for records.
I understand that you have sent a list of record holders to Mr.
Nelson, which he received on Saturday, September 27th. Your letter of
September 18, 1997 to Mr. Nelson, advised him that there are an additional
250 to 300 beneficial holders. If SWVA Bancshares has a list of the
beneficial holders, we believe that the Virginia statute's reference to
shareholders would include beneficial holders. Please forward this list
to Mr. Nelson. I reiterate my request to obtain from you the name of the
bank's attorney.
From our review of the correspondence between you and Mr.
Nelson, it is clear to us that you have attempted to make it as difficult
as possible for Mr. Nelson to obtain the records we believe he is entitled
to obtain under the Virginia Code.
I would appreciate your pointing out to me what you believe were
misstatements in my letter of September 26.
Very truly yours,
CASKIE & FROST, P.C.
By /s/ Theodore J. Craddock
Theodore J. Craddock
TJC/wp
Enclosure
cc: Phillip M. Goldberg, Esquire
Mr. Richard J. Nelson
