UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
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
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Check the appropriate box:
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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x
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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Pioneer 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):
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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(1)
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Title of each class of securities to which the transaction applies:
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(2)
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Aggregate number of securities to which the transaction applies:
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(3)
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Per unit price or other underlying value of the 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):
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(4)
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Proposed maximum aggregate value of the transaction:
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Fee paid previously with preliminary materials.
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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.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No.:
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April 16, 2009
Dear Fellow Stockholders:
We invite you to attend the 2009 Annual Meeting of Stockholders of Pioneer Bankshares, Inc. to be held in the Meeting
Room of Pioneer Bank, 252 East Main Street, Stanley, Virginia, at 10:00 a.m. on Wednesday, May 13, 2009. A formal notice of meeting is enclosed.
At the
meeting, we will elect three directors, each to serve a three-year term. Whether you plan to attend or not, please complete, sign, date and return your proxy in the enclosed postage-paid envelope.
Your vote is important, and the prompt return of
y
our proxy is appreciated.
We also cordially invite you to attend the Annual Social Gathering of the Stockholders, Directors and
Officers of Pioneer Bankshares, Inc. to be held at the Stanley Fire Hall, Stanley, Virginia, at 6:30 p.m. on Wednesday, May 13, 2009, for an evening of fine food and good fellowship.
I look forward to seeing you on the 13th of May.
Thomas R. Rosazza
President and Chief Executive Officer
PIONEER BANKSHARES, INC.
(Parent Company of Pioneer Bank)
263 East Main Street
Stanley, Virginia 22851
NOTICE OF ANNUAL
MEETING OF STOCKHOLDERS
(To be held May 13, 2009)
To the Stockholders of
Pioneer Bankshares, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Pioneer Bankshares, Inc. (the Company) will be held at the Main Office of
Pioneer Bank, 252 East Main Street, Stanley, Virginia, at 10:00 a.m. on Wednesday, May 13, 2009, for the following purposes:
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1.
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To elect three (3) individuals to serve as directors, each to serve a three-year term.
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2.
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To transact such other business as may properly come before the meeting or any adjournment thereof.
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The close of business on April 7, 2009 has been fixed by the Board of Directors as the record date for determination of stockholders entitled to notice
of, and to vote at the Annual Meeting, and any adjournment thereof.
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By Order of the Board of Directors
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Thomas R. Rosazza
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President and Chief Executive Officer
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April 16, 2009
PLEASE COMPLETE, SIGN, DATE AND RETURN YOUR PROXY AS SOON AS POSSIBLE REGARDLESS OF WHETHER YOU PLAN TO ATTEND THE MEETING IN PERSON. YOU MAY REVOKE THE PROXY AT ANY TIME PRIOR TO IT BEING EXERCISED.
PIONEER BANKSHARES, INC.
263 East Main Street
Stanley, Virginia 22851
PROXY STATEMENT
ANNUAL MEETING OF
STOCKHOLDERS
May 13, 2009
GENERAL
The Board of Directors and management of Pioneer Bankshares, Inc. (the Company) solicit your proxy for
the Annual Meeting of Stockholders of Pioneer Bankshares, Inc., the parent of Pioneer Bank, Stanley, Virginia (the Bank), to be held at the main office of Pioneer Bank, 252 East Main Street, Stanley, Virginia, at 10:00 a.m. on Wednesday,
May 13, 2009. The approximate mailing date of this Proxy Statement and accompanying proxy form is April 16, 2009.
Revocation and Voting of Proxies
Execution of a proxy will not affect a stockholders right to attend the Annual Meeting and to vote in person. Any stockholder who has
executed and returned a proxy may revoke it by attending the Annual Meeting and requesting to vote in person. A stockholder may also revoke his proxy at any time before it is exercised by filing a written notice with the Company or by submitting a
proxy bearing a later date. Proxies will extend to, and will be voted at, any adjourned session of the Annual Meeting.
Voting Rights and
Solicitation
Only stockholders of record at the close of business on April 7, 2009 are entitled to notice of and to vote at the Annual
Meeting or any adjournments thereof. As of the close of business on April 7, 2009, there were 1,020,914 shares of the Companys common stock outstanding and entitled to vote at the Annual Meeting. The Company has no other class of stock
outstanding. A majority of the shares entitled to vote, represented in person or by proxy, will constitute a quorum for the transaction of business.
Each share of common stock entitles the record holder thereof to one vote upon each matter to be voted upon at the Annual Meeting. Shares for which the holder has elected to abstain or to withhold the proxies
authority to vote (including broker non-votes) on a matter will count toward a quorum, but will not be included in determining the number of votes cast with respect to such matter.
The cost of solicitation of proxies will be borne by the Company Solicitation is being made in person, by telephone, fax, e-mail, or special letter by
officers, directors, and employees of the Company, acting without additional compensation other than regular compensation.
Your
Board of Directors and management urge you to complete, sign, date and mail your proxy to make certain that your shares will be voted at the meeting.
PROPOSAL ONE ELECTION OF DIRECTORS
The Board of Directors currently consists of nine members, eight of which are independent directors, as defined under NASDAQ listing standards, and one
is a member of management. In accordance with the Companys Articles of Incorporation, directors are divided into three classes, each of which is composed of approximately one-third of the total number of directors. At the Annual Meeting, three
directors will be elected for terms of three years expiring on the date of the Annual Meeting of Stockholders in 2012. Each director elected will continue in office until a successor has been elected or until his resignation or removal in the manner
prescribed by the Articles of Incorporation of the Company.
With regard to the election of directors, votes may be cast in favor of or
withheld. If a quorum is present, the nominees receiving a plurality of the votes cast at the Annual Meeting will be elected directors; therefore, votes withheld will have no effect. Although abstentions and broker non-votes (shares held by
customers which may not be voted on certain matters because the broker has not received specific instructions from the customer) are counted for purposes of determining the presence or absence of a quorum for the transaction of business, they are
generally not counted for purposes of determining whether a proposal has been approved and, therefore, have no effect.
The Board of
Directors has recommended three nominees, each of which is currently serving as a director. Any nominations other than those made by the Board of Directors shall be in accordance with the Bylaws of the Company. The Board of Directors has no reason
to believe that any of the nominees will be unable or unwilling for good cause to serve if elected. However, if any nominee should become unable or unwilling for good cause to serve for any reason, proxies may be voted for another person nominated
as a substitute by the Board of Directors, or the Board of Directors may reduce the number of directors.
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Name (Age)
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Director Since
(1)
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Principal Occupation
During Past Five Years
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Nominees (For a term expiring in 201
2
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Patricia G. Baker (66)
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1989
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Chair of the Board of Pioneer Bankshares, Inc.,
Retired
Bank Officer.
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Robert E. Long (78)
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1989
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Retired Merchant/Realtor.
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Kyle L. Miller (74)
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1986
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Retired Virginia State Police Investigator.
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Other Directors Not Standing For Election At This Time:
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Term expiring in 20
10
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Harry F. Louderback (68)
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1998
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Farmer/Retired from FBI.
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Thomas R. Rosazza (67)
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1973
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President/CEO of Pioneer Bankshares, Inc. and Pioneer Bank.
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David N. Slye (56)
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1996
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Insurance Agent/Owner, The Slye Agency.
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Term expiring in 20
11
:
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Louis L. Bosley (77)
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1976
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Business Owner, Stanley Auto Service.
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E. Powell Markowitz (57)
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1999
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Secretary & Treasurer, F.T. Reuter Enterprises, Inc.
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Mark N. Reed (51)
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1994
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Attorney at Law, Reed & Reed, P.C.
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(1)
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Includes service as a director of the Bank.
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THE BOARD OF DIRECTORS RECOMMENDS THE NOMINEES, AS SET FORTH ABOVE, FOR ELECTION. THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE
FOR
EACH NOMINEE.
2
Board of Directors and Committees
Each director is expected to devote sufficient time, energy and attention to ensure diligent performance of the directors duties, including the
attendance at Board and committee meetings. During 2008, the Board of Directors of the Company held 8 meetings and the Board of Directors of the Bank held 12 meetings. All incumbent directors attended at least 75% of the aggregate total number of
meetings of the Board of Directors and its committees on which he or she served in 2008. Directors are encouraged to attend stockholders meetings, and all directors attended the 2008 Annual Meeting of Stockholders.
There are no immediate family relationships among any of the directors or among any directors and any officer. No director serves as a director of any
other company with a class of securities registered under Section 12 of the Securities Exchange Act of 1934.
The Board of Directors has
the following committees:
Compensation Committee
. The Compensation Committee consists of Kyle. L. Miller, Robert E. Long and David
N. Slye. The members of the Compensation Committee meet the requirements for independence as set forth in NASDAQs definition of independent director, and meet the definition of independent as set forth in Rule 10A-3 of
the Securities Exchange Act of 1934. The primary functions of this committee are to recommend the compensation of the Chief Executive Officer and the Chief Financial Officer to the full Board of Directors, and periodically review the compensation of
other employees of the Company. This committee has a formal charter, which outlines the committees specific duties and responsibilities. The Compensation Committee met 9 times during 2008.
Audit
Committee
. The Audit Committee consists of E. Powell Markowitz, Patricia G. Baker and Harry F. Louderback. The members of the
Audit Committee meet the requirements for independence as set forth in NASDAQs definition of independent director, and meet the definition of independent as set forth in Rule 10A-3 of the Securities Exchange Act of
1934. In addition, no member of the committee has participated in the preparation of the financial statements of the Company or any subsidiary of the Company at any time during the past three years.
Mr. Markowitz chairs the Audit Committee. For the past 30 years, Mr. Markowitz has been the Secretary and Treasurer of F. T. Reuter Enterprises, Inc.,
which operates a hotel and restaurant in Middleburg, Virginia, and trades worldwide, in antique fine art. Prior to becoming affiliated with F. T. Reuter Enterprises, Inc., Mr. Markowitz was a staff accountant for five years with Yount, Hyde &
Company, certified public accountants. Mr. Markowitz earned a Bachelor of Business Administration from Madison College, Harrisonburg, Virginia in 1974 and brings a diversity of financial knowledge and expertise to the Audit Committee. Mr. Markowitz
was duly re-appointed as chairman of the Audit Committee in 2008, and serves as the financial expert for the Audit Committee of Pioneer Bankshares, Inc.
The Audit Committee has a formal charter and is directly responsible for the appointment, compensation, retention and oversight of the Companys independent accounting firm. Accordingly, the independent
accounting firm reports directly to the Audit Committee of the Company. The Audit Committee is responsible for the selection of the Companys independent accountants, approval of the scope of the independent accountants audit, review of
the reports of examination by the regulatory agencies, the independent accountants and the internal auditor, and for issuing its report to the Board of Directors of the Company. The charter of the Audit Committee was included in the Companys
2007 proxy statement relating to its annual stockholders meeting, and is available upon request. To obtain a copy of the charter, please submit your request pursuant to the instructions under Corporate Governance in this Proxy Statement.
The Audit Committee met 5 times during 2008.
Co
rporate Governance
Committee
.
Directors serving on this
committee are Patricia G. Baker, Mark N. Reed and Thomas R. Rosazza. This committee has a formal charter and meets as necessary outside the Board meetings to review corporate governance issues including, but not limited to, director service and
assessment, nominations and continuing education.
Strategic Planning Committee
. Directors serving on this committee are Kyle L.
Miller, Mark N. Reed and Thomas R. Rosazza. This committee has a formal charter, which outlines its specific duties and responsibilities. The committee meets as necessary outside the Board meetings to review and establish the long-term goals of the
Company. The Strategic Planning Committee met 2 times in 2008.
Investment Committee
.
Directors serving on this committee are
Patricia G. Baker, E. Powell Markowitz, Mark N. Reed and Thomas R. Rosazza. This committee has the primary responsibility of managing the Companys equity securities and investment portfolio. This committee met 4 times in 2008.
3
Other Committees
The Board of Directors of the Bank has, among others, the following committees:
Asset/Liability Funds
Management Committee (ALCO)
. Directors serving on this committee are Louis L. Bosley, Kyle L. Miller and Robert E. Long. This committee has the primary responsibility of managing the Banks assets and liabilities, maintaining
adequate liquidity and capital positions, and monitoring interest rate sensitivity within the loan and deposit portfolios. This committee met 5 times in 2008.
Electronic Data Processing/IT Steering Committee
.
Directors serving on this committee are Harry F. Louderback, Louis L. Bosley and David N. Slye. This committee has the primary responsibility of
monitoring the data processing functions of the Bank and making recommendations for system enhancements and computer upgrades. This committee met 4 times in 2008.
Corporate Governance
The Companys Code of Ethics applies to all directors, officers and employees, including the
Companys principal executive officer and principal financial officer. A copy of the Code of Ethics, as well as any committee charter, is available upon written request to Pioneer Bankshares, Inc., Attn: Judy L. Painter, Corporate Secretary, at
263 East Main Street, Stanley, Virginia 22851.
Nomination Procedures
The Companys independent directors perform the functions of a nominating committee based on recommendations from the Corporate Governance Committee. The Board believes it does not need a separate nominating
committee because a majority of the directors are independent and stockholders are best served by having such directors participate in the selection of board nominees. In their capacity as the nominating committee, the independent members of the
Board of Directors will accept for consideration stockholder nominations for directors if made in writing in accordance with the Companys Bylaws. The following is a summary of the stockholder nomination procedures contained in the
Companys Bylaws and is qualified in its entirety by reference to the Bylaws. Please see the Bylaws for the specific procedures of the stockholder nomination process.
The Companys Bylaws state, in general, that for any nomination of a director to be properly brought before an annual meeting by a stockholder, the
stockholder must provide timely notice of the nomination in writing to the Secretary of the Company. For a notice to be considered timely, the Secretary of the Company must have received the notice no less than 60 days nor more than 90 days before
the first anniversary of the preceding years annual meeting. The notice must set forth as to each person whom the stockholder proposes to nominate for election or reelection as a director, all information relating to such person that is
required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, including such persons written consent to being named
in the proxy statement as a nominee and to serving as a director if elected. The Chairman of the meeting may refuse to acknowledge the nomination of any person not made in compliance with the foregoing procedure.
The Companys Corporate Governance charter addresses and establishes certain procedures for director nominations and recommendations. The Company
does not have any specific minimum qualifications that must be met by a nominee and does not distinguish between nominees recommended by Board members or by stockholders. Qualifications for consideration as a director nominee may vary according to
the particular areas of expertise that may be desired in order to complement the qualifications that already exist among the Board. Among the factors that the directors consider when evaluating proposed nominees are their independence, financial
literacy, business experience, character, judgment and strategic vision. Other considerations would be their knowledge of issues affecting the business, their leadership experience and their time available for meetings and consultation on Company
matters. The independent directors seek a diverse group of candidates who possess the background skills and expertise to make a significant contribution to the Board, the Company and its stockholders.
The above procedures are in addition to the procedures regarding inclusion of stockholder proposals in proxy materials set forth in stockholder
proposals in this proxy statement.
4
REPORT OF THE AUDIT COMMITTEE
The Audit Committee of Pioneer Bankshares, Inc. has the responsibility, under delegated authority from the Board of Directors, for providing independent,
objective oversight of the Companys accounting functions and internal controls. The Audit Committee is elected by the Board of Directors of the Company. All members are independent of management. In addition, the Audit Committee operates under
a written charter adopted by the Board of Directors. While management has the primary responsibility for the quality and integrity of the Companys financial statements and reporting processes, the Audit Committee provides assistance to
management in fulfilling this responsibility, as necessary. In fulfilling its oversight responsibilities, the Audit Committee reviewed the audited financial statements included in the Companys Annual Report on Form 10-K for the year ended
December 31, 2008 with management and the independent auditors, and discussed the quality and acceptability of the accounting principles, the reasonableness of significant judgments, and the clarity of disclosure in the financial statements.
In addition, the committee obtained from the independent auditors a formal written statement discussing any disclosed relationship or
service which may impact the objectivity and independence of the independent auditors, as required by Independence Standards Board Standard No. 1 Independence Discussions with Audit Committees. The committee also discussed with the
independent auditors all communications required by Public Company Accounting Oversight Board Standard AU Section 380 and rule 2-07 of Regulation S-X, as amended, and other professional and regulatory standards.
The Audit Committee also monitored the internal audit functions of the Company including the independence and authority of its reporting obligation, the
proposed audit plan for the coming year, and the adequacy of management response to internal audit findings and recommendations.
In
reliance on the reviews and discussions referred to above, the Audit Committee has recommended to the Board of Directors that the audited financial statements be included in the Annual Report on Form 10-K for the year ended December 31, 2008 for
filing with the Securities and Exchange Commission (the SEC). The Companys Audit Committee has approved the selection of the Companys independent auditors.
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Audit Committee
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E. Powell Markowitz, Chair
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Patricia G. Baker
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Harry F. Louderback
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ACCOUNTING FIRM FEES
Yount, Hyde and Barbour, P.C. audited the financial statements included in the Companys Annual Report on Form 10-K for the year ended December 31,
2008. The following table presents aggregate fees paid or to be paid by the Company for professional services rendered by Yount, Hyde and Barbour, P.C. for the audit of the Companys annual financial statements for fiscal 2008 and 2007. This
table also includes fees billed for audit-related services, tax services and all other services rendered by the audit firm during fiscal years 2008 and 2007.
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Fiscal 2008
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Fiscal 2007
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Audit Fees
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$
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60,250
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$
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55,800
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Audit-related Fees
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4,045
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9,598
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Tax Fees
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3,780
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3,500
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All Other Fees
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$
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68,075
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$
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68,898
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All non-audit services provided by the above named audit firm were approved by the Audit
Committee, which concluded that the provision of such services is compatible with maintaining the firms independence. The fees listed above as tax fees are for the preparation of the annual consolidated federal and state income tax returns.
The Audit Committee pre-approves all audit, audit related, and tax services on an annual basis, and in addition, authorizes individual
engagements that exceed pre-established thresholds. Any additional engagement that exceeds the pre-established thresholds must be reported by management at the Audit Committee meeting immediately following the initiation of such an engagement.
5
DIRECTORS COMPENSATION
Non-employee directors of the Company received an annual retainer of $2,095 each for their service in 2008. The 2008 retainer was distributed to each
non-employee director in the form of a stock award consisting of 114 shares of the Companys common stock at a fair market value of $18.38 per share. Non-employee directors of Pioneer Bank received additional stock awards during 2008 in lieu of
their monthly directors fee of $1,085 per month for their service as a Bank Board member. The stock awards for the 2008 directors fees were distributed in two separate stock issuances, the first being an issuance of 339 shares of the
Companys common stock at a fair market value of $19.15 per share and the second being an issuance of 354 shares of the Companys common stock at a fair market value of $18.38 per share.
Directors also received $200 for each Board committee meeting they attended in 2008. Director Patricia Baker served as the Chair of the Board during 2008
and received chair fees in the amount of $800 per board meeting, in addition to the fees paid for her service as director. Director E. Powell Markowitz served as the Chair of the Audit Committee during 2008 and received an additional $100 per
meeting for his service.
The following table presents the total compensation paid to non-employee directors during 2008:
Director Compensation Table
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Name
(1)
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Fees
Earned
or Paid
in Cash
(2)
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Stock
Awards
(2)
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Total
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Patricia G. Baker
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$
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9,600
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$
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15,094
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$
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24,694
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Louis L. Bosley
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1,000
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15,094
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16,094
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Robert E. Long
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2,600
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15,094
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17,694
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Harry F. Louderback
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1,600
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15,094
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16,694
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E. Powell Markowitz
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1,800
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15,094
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16,894
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Kyle L. Miller
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3,000
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15,094
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18,094
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Mark N. Reed
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1,000
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15,094
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16,094
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David N. Slye
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2,400
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15,094
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17,494
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(1)
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The Companys President and CE
O
, Thomas R. Rosazza, is not included in this table as he is an executive officer of the Company and receives no
compensation for his services as a director. The President and CEOs compensation is shown in the Summary Compensation Table included in this proxy statement.
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(2)
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Each Company director also serves on the Banks board of directors, therefore the amounts reported in this table reflect compensation for board services paid by the Company
and the Bank.
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Non-employee director compensation is reviewed on an annual basis. Any adjustments made to
non-employee director fees are based primarily on information obtained through the Virginia Bankers Association Salary and Compensation Survey and other outside sources, which provide comparative data for director compensation with other similarly
sized institutions across Virginia. Other factors considered in determining non-employee director compensation are the time commitments involved and the individual risk exposure based on the size of the institution.
The Companys 1998 Stock Incentive Plan (the Plan) was adopted by the Board of Directors on June 11, 1998 and approved by the
shareholders on June 11, 1999. This ten year Plan expired in June of 2008 with respect to the issuance of new option grants. However, grants previously issued under this Plan may still be exercised within the original terms. There were 700 stock
option shares exercised by non-employee directors during 2008 at an exercise price of $18.00 per share.
6
A Directors Deferred Compensation Plan was established by the Company in August of 1987. All
directors were given the option of deferring their fee compensation for a period of five years in return for a defined benefit payout beginning at age 65. Not all directors chose to participate in this plan. The participating directors who received
benefit payments during 2008 under this plan were Kyle L. Miller, and President and CEO Thomas R. Rosazza, who also serves as a director. There are no additional deferral options available to directors under this plan.
EXECUTIVE COMPENSATION
No officer
receives compensation from the Company. All compensation is paid directly through the Bank. The following table presents compensation information on the President and Chief Executive Officer of the Company for the years indicated. No other executive
officer of the Company earned over $100,000
in salary and bonus in 2008.
Summary Compensation Table
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Name and
Principal Position
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Year
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Salary
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Bonus
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All Other
Compensation
(1)
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Total
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Thomas R. Rosazza
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President and CEO
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2008
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$
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147,377
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$
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2,910
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$
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150,287
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2007
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147,944
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$
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45,000
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(2)
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3,849
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196,793
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2006
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140,428
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45,000
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4,314
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189,742
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(1)
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Represents
employer
contributi
ons
to the Banks 401(k) profit sharing plan
for each year.
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(2)
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Represents bonus compensation expense for 2007, which was subsequently distributed in 2008 in the form of a stock award of 873 common shares of the Companys stock at a fair
market value of $25.75 per share, with the remainder of the bonus paid as cash compensation of $22,520.
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Executive Compensation
Discussion
The Companys executive compensation program is designed to (i) attract and retain key executives critical to the
success of the Company; (ii) integrate performance and compensation with the short and long-term strategic plans of the Company; (iii) reward performance with respect to achieving the Companys goals; and (iv) align the interests of the
executives with the long-term interests of the stockholders. The compensation program of the Company for its executive officers is generally administered at the direction of the Compensation Committee and reviewed annually.
In determining executive compensation, the Compensation Committee reviews the elements of each executive officers compensation and considers both
objective and subjective criteria. With respect to the objective portion of the performance evaluation, the committee specifically considers certain financial performance measures of the Company which may include, but are not limited to, net income,
return on equity, non-interest income, net interest margin and efficiency ratio. Additionally, the Compensation Committee reviews the results of the Virginia Bankers Association compensation survey, and compares the Companys executive
compensation with other similarly sized banks across Virginia. The committee also takes into account the performance of the Companys stock and shareholders return. As to the subjective component, the Compensation Committee considers the
executives level of responsibility and performance, and the individuals contribution in achieving the Companys long-term mission.
The Compensation Committee considers input from the President and Chief Executive Officer with respect to executive officers that report to him and makes appropriate recommendations to the Board of Directors. In determining the compensation
of the President and CEO and that of the other executive officers, the committee uses the same objective and subjective measures as previously discussed, and their subjective assessment of the President and CEOs contributions to the overall
success of the Company.
Employment Contracts and Termination and Change in Control Arrangements
No employment contracts or change in control agreements have been entered into by the Company with any of its officers and none are contemplated at this
time.
7
Stock Option Information
The Companys 1998 Stock Incentive Plan previously provided for the granting of stock options to executive officers and employees of the Company and
its subsidiaries. No stock options have been granted to the President and CEO or any other executive officer under the plan.
Benefit Plans
Equity
Compensation Plan Information
.
The Companys 1998 Stock Incentive Plan (the Plan) was
adopted by the Board of Directors on June 11, 1998 and approved by the shareholders on June 11, 1999. This ten year Plan expired in June of 2008 with respect to the issuance of new option grants. However, grants previously issued under this Plan may
still be exercised within the original terms. Generally, the Plan provided for the grants of incentive stock options and non-qualified stock options. The exercise price of an Option could not be less than 100% of the fair market value of the common
stock (or if greater, the book value) on the date of the grant. The option terms applicable to each grant were determined at the grant date, but no Option could be exercisable in any event, after ten years from its grant date. As of April 7, 2009,
there were 7,200 exercisable options outstanding for non-employee directors under this plan.
401(k) Plan
. The Bank has a 401(k)
Profit Sharing Plan covering full-time employees who have completed 180 days of service and are at least 21 years of age. Employees may contribute compensation subject to certain limits based on federal tax laws. The Bank makes discretionary
matching contributions of up to 3 percent of an employees annual compensation contributed to the Profit Sharing Plan. Additional amounts may be contributed, at the option of the Banks Board of Directors. Employer contributions vest to
the employee over a six-year period, and employees become 100% vested in his/her seventh year of full-time employment. For the years ended December 31, 2008, 2007 and 2006, total expense attributable to this 401(k) plan amounted to $35,651, $29,884
and $36,569, respectively.
Equity Awards
. The Board of Directors adopted formal resolutions in February 2008, authorizing the
granting of stock awards to certain Company and Bank employees and non-employee directors of the Company. With respect to the employees, awards are generally made in recognition of employee performance and their contribution to the Companys
overall performance. The awards for Directors are generally made in lieu of director and retainer fees. Stock awards paid to Directors during 2008 are disclosed within the Directors Compensation section of this proxy statement. There were no
stock awards issued to executive officers or other employees for 2008.
INTEREST OF DIRECTORS AND OFFICERS IN CERTAIN TRANSACTIONS
Some of the Companys directors, executive officers, and members of their immediate families, and corporations, partnerships and
other entities, of which such persons are officers, directors, partners, trustees, executors or beneficiaries, are customers of the Bank. As of December 31, 2008, total borrowings for executive officers, directors, their immediate families, and
affiliated companies and other entities were approximately $793,000. All loans and loan commitments to them were made in the ordinary course of business, upon substantially the same terms, including interest rates and collateral, as those prevailing
at the time for comparable transactions with other persons and did not involve more than normal risk of collectibility or present other unfavorable features. It is the policy of the Bank to provide loans to officers who are not executive officers
and to employees at more favorable rates than those prevailing at the time for comparable transactions with other persons. These loans do not involve more than the normal risk of collectibility or present other unfavorable features.
The law firm of Reed & Reed, P.C. serves as legal counsel to the Company and the Bank. Director Mark N. Reed is a senior partner in this firm. Total
fees paid to the firm of Reed & Reed, P.C. from the Company and Bank were approximately $53,000, $35,000, and $19,000 for fiscal years 2008, 2007, and 2006 respectively.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Pursuant to Section
16(a) of the Securities Exchange Act of 1934, directors and executive officers of the Company are required to file reports with the Securities and Exchange Commission indicating their holdings of and transactions in Company common stock. To the
Companys knowledge, based solely on a review of the copies of such reports furnished to the Company and written representations that no other reports were required, insiders of the Company complied with all filing requirements during 2008.
8
OWNERSHIP OF COMPANY COMMON STOCK
The following table provides as of April 7, 2009, certain information with respect to the beneficial ownership of the Companys common stock for (i)
each stockholder known by the Company to own beneficially more than 5% of the Companys common stock, (ii) the directors and director nominees of the Company, (iii) the executive officer named in the Summary Compensation Table in this Proxy
Statement, and (iv) all directors, director nominees and executive officers of the Company as a group.
|
|
|
|
|
|
|
Name
|
|
Amount and Nature of
Beneficial Ownership
(1)
|
|
|
Percent of Class
|
|
Directors and Officers:
|
|
|
|
|
|
|
|
|
|
Patricia G. Baker
|
|
19,292
|
(2)(3)
|
|
1.89
|
%
|
Louis L. Bosley
|
|
24,735
|
(2)(3)
|
|
2.42
|
%
|
Robert E. Long
|
|
19,330
|
(3)
|
|
1.89
|
%
|
Harry F. Louderback
|
|
20,045
|
(2)(3)
|
|
1.96
|
%
|
E. Powell Markowitz
|
|
3,715
|
(3)
|
|
*
|
|
Kyle L. Miller
|
|
14,835
|
(2)(3)
|
|
1.45
|
%
|
Mark N. Reed
|
|
8,145
|
(2)(3)
|
|
*
|
|
Thomas R. Rosazza
|
|
17,067
|
(2)
|
|
1.67
|
%
|
David N. Slye
|
|
4,330
|
(3)
|
|
*
|
|
|
|
|
Executive officers who are not directors (as a group)
|
|
1,022
|
|
|
*
|
|
All directors and executive officers as a group
|
|
132,516
|
(4)
|
|
12.89
|
%
|
|
|
|
Principal Stockholder
:
|
|
|
|
|
|
|
|
|
|
Richard T. Spurzem
P.O. Box Drawer R
Charlottesville, Virginia 22903
|
|
101,056
|
(5)
|
|
9.90
|
%
(6)
|
|
|
|
*
|
Indicates less than 1% beneficial ownership.
|
|
(1)
|
For purposes of this table, beneficial ownership has been determined in accordance with the provisions of Rule 13d-3 of the Securities Exchange Act of 1934 under which, in
general, a person is deemed to be the beneficial owner of a security if he has or shares the power to vote or direct the voting of the security or the power to dispose of or direct the disposition of the security, or if he has the right to acquire
beneficial ownership of the security within sixty days. Shares of common stock which are subject to stock options are deemed to be outstanding for the purpose of computing the percentage of outstanding common stock owned by such person or group but
not deemed outstanding for the purpose of computing the percentage of common stock owned by any other person or group.
|
|
(2)
|
Includes shares held by close relatives and children, and shares held jointly with spouses or as custodians or trustees, as follows: Mrs. Baker, 9,905 shares; Mr. Bosley, 11,820
shares; Mr. Louderback, 650 shares; Mr. Miller, 5,590 shares; Mr. Reed, 5,260 shares; Mr. Rosazza, 9,1
82.
|
|
(3)
|
Includes shares of unexercised stock options directly owned as follows: Mrs. Baker,
900
shares; Mr. Bosley,
900
shares; Mr. Long,
900
shares; Mr. Louderback,
900
shares; Mr. Markowitz, 900 shares; Mr. Miller,
900
shares; Mr. Reed,
900
shares; and Mr. Slye,
900
shares.
|
|
(4)
|
Includes 7,
2
00 shares of unexercised stock options directly owned; 4
2,407
shares held by close relatives and children; and shares held jointly with
spouses or as custodians or trustees.
|
|
(5)
|
Based on information derived from a Schedule 13D/A dated January 29, 2008, and
originally
filed with the S
ecurities and Exchange Commission
on January
30, 2008.
|
|
(6)
|
Percentage ownership of the principal stockholder is calculated based on the total number of outstanding shares of common stock as of the record date.
|
9
OTHER MATTERS
Management knows of no other business to be brought before the Annual Meeting. Should any other business properly be presented for action at the meeting, the shares represented by the enclosed proxy shall be voted by
the persons named therein in accordance with their best judgment and in the best interests of the Company.
STOCKHOLDER PROPOSALS
To be considered for inclusion in the Companys proxy materials relating to the 2010 Annual Meeting of Stockholders pursuant to
applicable Securities and Exchange Commission rules, the Secretary of the Company must receive stockholder proposals no later than December 17, 2009. Stockholder proposals should be addressed to Pioneer Bankshares, Inc., Attn: Judy L. Painter,
Corporate Secretary, at 263 East Main Street, P.O. Box 10, Stanley, Virginia 22851.
The 2010 Annual Meeting of Stockholders is tentatively
scheduled for Wednesday, May 12, 2010.
STOCKHOLDER COMMUNICATIONS
Pioneer Bankshares, Inc. has a process whereby stockholders can contact the Companys directorship. A stockholder or other party interested in
communicating directly with a director of the Company or the entire Board may do so by writing to that director or the Board, Attn: Judy L. Painter, Corporate Secretary, at 263 East Main Street, P.O. Box 10, Stanley, Virginia 22851.
AVAILABILITY OF PROXY MATERIALS AND ANNUAL REPORT ON FORM 10-K
The Companys 2009 Proxy Materials and Annual Report on Form 10-K for the year ended December 31, 2008, excluding exhibits, as filed with the Securities and Exchange Commission, are available to the public in
electronic format and can be accessed free of charge at
http://www.cfpproxy.com/4609
. Copies of the 2009 Proxy Materials and the Companys Annual Report on Form 10-K for the year ended December 31, 2008, excluding exhibits, as filed with
the Securities and Exchange Commission can also be obtained without charge by writing to Pioneer Bankshares, Inc., Attn: Thomas R. Rosazza, President and Chief Executive Officer, at 263 East Main Street, P.O. Box 10, Stanley, Virginia 22851. This
information may also be accessed, without charge, by visiting the SECs Electronic Data Gathering and Retrieval Service EDGAR website at
www.sec.gov
.
10
PLEASE MARK VOTES
AS IN THIS EXAMPLE
REVOCABLE PROXY PIONEER BANKSHARES, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
MAY 13, 2009
The undersigned, revoking all prior proxies, hereby appoints
David N. Slye and E. Powell Markowitz, as proxies, and each or either of them with full power of substitution, and hereby authorizes them to represent and to vote, as designated below, all shares of the common stock of Pioneer Bankshares, Inc. held
of record by the undersigned as of the close of business on April 7, 2009, at the Annual Meeting of Stockholders to be held at the Main Office of Pioneer Bank, Stanley, Virginia, at 10:00 a.m. on May 13, 2009, or any adjournment thereof, on each of
the following matters:
Please complete, date and sign the proxy and return it in the enclosed postage-paid envelope. The
proxy must be signed exactly as the name(s) appear on the label affixed to this proxy. If signing as a trustee, executor, etc., please so indicate. Please return as soon as possible.
Date:
Stockholder sign above
Co-holder (if any) sign above
2. To Transact any other business which may properly be brought before the meeting or any adjournment thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE,
THIS PROXY WILL BE VOTED FOR PROPOSAL 1 ABOVE. IF ANY OTHER MATTER SHALL BE BROUGHT BEFORE THE MEETING, THE SHARES WILL BE VOTED AT THE DISCRETION OF THE HOLDERS OF THE PROXY.
Directors to be elected for a three year term to expire in 2012 (except as marked to the contrary below):
INSTRUCTION: To withhold authority to vote fcor any Individual nominee, mark For All Except and write that nominees name
In the space provided below.
Patricia G. Baker Robert E. Long Kyle L. Miller
1. PROPOSAL ONE ELECTION OF DIRECTORS:
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES LISTED
FOR WITH-HOLD FOR ALL EXCEPT
Detach above card, sign, date and mail in postage paid envelope provided.
PIONEER BANKSHARES, INC. (Parent Company of Pioneer Bank, Stanley, Virginia)
PLEASE ACT PROMPTLY COMPLETE, SIGN, DATE & MAIL YOUR PROXY CARD TODAY
IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED BELOW AND RETURN THIS PORTION WITH THE PROXY IN THE ENVELOPE
PROVIDED.
PROXY MATERIALS ARE AVAILABLE ON-LINE AT:
http://www.cfpproxy.com/4609
4609
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