-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Im0uhN79E/qA0zXYjPp6vDyCcykQk0AZdgP98hJPxBnp/8b9cIDAyCPzGGmToiPM T07EHbyWGSTeF3AWomKeOA== 0001047469-99-014425.txt : 19990413 0001047469-99-014425.hdr.sgml : 19990413 ACCESSION NUMBER: 0001047469-99-014425 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990519 FILED AS OF DATE: 19990412 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SEIBELS BRUCE GROUP INC CENTRAL INDEX KEY: 0000276380 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 570672136 STATE OF INCORPORATION: SC FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: SEC FILE NUMBER: 000-08804 FILM NUMBER: 99591758 BUSINESS ADDRESS: STREET 1: 1501 LADY ST STREET 2: P O BOX 1 CITY: COLUMBIA STATE: SC ZIP: 29201 BUSINESS PHONE: 8037482000 MAIL ADDRESS: STREET 1: 1501 LADY ST STREET 2: P O BOX 1 CITY: COLUMBIA STATE: SC ZIP: 29201 DEF 14A 1 DEF 14A SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Schedule 14(a) of the Securities Exchange Act of 1934 File by the Registrant /X/ Filed by a Party other than Registrant / / Check the Appropriate Box: / / Preliminary Proxy Statement / / Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) /X/ Definitive Proxy Statement / / Definitive Additional Materials / / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12 THE SEIBELS BRUCE GROUP, INC. (Name of Registrant as Specified In Its Charter) (Name of Person Filing Proxy Statement) Payment of Filing Fee (Check the appropriate box): /X/ No fee required. / / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. 1. Title of each class of securities to which transaction applies: ---------------------------------------------------------------------- 2. Aggregate number of securities to which transaction applies: ---------------------------------------------------------------------- 3. Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): ---------------------------------------------------------------------- 4. Proposed maximum aggregate value of transaction: ---------------------------------------------------------------------- 5. Total fee paid: ---------------------------------------------------------------------- / / Fee paid previously with preliminary materials: / / Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. 1. Amount Previously Paid: ---------------------------------------------------------------------- 2. Form, Schedule or Registration Statement no.: ---------------------------------------------------------------------- 3. Filing Party: ---------------------------------------------------------------------- 4. Date Filed: ---------------------------------------------------------------------- THE SEIBELS BRUCE GROUP, INC. COLUMBIA, SOUTH CAROLINA NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 19, 1999 TO THE SHAREHOLDERS OF THE SEIBELS BRUCE GROUP, INC.: Notice is hereby given that the Annual Meeting of Shareholders (the "Meeting") of The Seibels Bruce Group, Inc. ("SBIG" or the "Company") will be held at the offices of the Company at 1501 Lady Street, Columbia, South Carolina 29201, at 11:00 a.m., on Wednesday, May 19, 1999 for the purpose of considering and acting upon the following: 1) The election of two (2) directors to hold office until the 2002 Annual Meeting of Shareholders or until his/her successor shall be elected and shall qualify (Proposal 1); 2) The ratification of the Board's appointment of Arthur Andersen LLP as auditors of the Company's books and records for the fiscal year ending December 31, 1999 (Proposal 2); and 3) The transaction of such other business as may properly and lawfully come before the Meeting or any adjournment thereof. All of the foregoing is more fully set forth in the Proxy Statement accompanying this Notice. The transfer books of the Company will close as of the end of business on March 22, 1999 (the "Record Date") for purposes of determining shareholders who are entitled to notice of and to vote at the Meeting, but will not be closed for any other purpose. All shareholders are cordially invited to attend the Meeting in person. If you cannot attend the Meeting, please take the time to promptly sign, date and mail the enclosed proxy in the envelope we have provided. If you attend the Meeting and decide that you want to vote in person, you may revoke your proxy. The Board of Directors recommends that you vote in favor of the nominees for directors and the described proposals to be considered at the Meeting. By Order of the Board of Directors /s/ Matt P. McClure ------------------- Matt P. McClure Corporate Secretary April 12, 1999 THE ACCOMPANYING PROXY FORM IS SOLICITED BY THE BOARD OF DIRECTORS AND IS REVOCABLE AT ANY TIME PRIOR TO BEING EXERCISED. THE PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS THEREON. IF A CHOICE IS NOT INDICATED, HOWEVER, THE PROXY WILL BE VOTED IN FAVOR OF THE NOMINEES FOR DIRECTORS, IN FAVOR OF THE DESCRIBED PROPOSALS TO BE CONSIDERED AT THE MEETING, AND IN THE BEST JUDGMENT OF THE PROXIES CONCERNING ALL OTHER PROPOSALS CONSIDERED AT THE MEETING. THE SEIBELS BRUCE GROUP, INC. 1501 Lady Street Columbia, South Carolina 29201 PROXY STATEMENT FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 19, 1999 GENERAL This Proxy Statement is furnished to the holders of common stock, par value $1.00 per share (the "Common Stock"), of The Seibels Bruce Group, Inc. ("SBIG" or the "Company") in connection with the solicitation of proxies by the Board of Directors of the Company to be voted at the Annual Meeting of Shareholders (the "Meeting") to be held at the time and place and for the purposes specified in the accompanying Notice of Annual Meeting of Shareholders and at any adjournments thereof. It is anticipated that this Proxy Statement will be mailed to shareholders commencing on or about April 12, 1999. When the enclosed proxy is properly executed and returned, the shares which it represents will be voted at the Meeting in accordance with the instructions thereon. In the absence of any such instructions, the shares represented thereby will be voted in favor of the nominees for directors and the described proposals to be considered at the Meeting and in the best judgment of the proxies concerning all other proposals considered at the Meeting. Any shareholder who executes and delivers a proxy may revoke it prior to its use by (i) giving written notice of such revocation to the Corporate Secretary of SBIG at Post Office Box One, Columbia, South Carolina 29202, the Company's mailing address; or (ii) executing and delivering to the Corporate Secretary of SBIG (by mail at Post Office Box One, Columbia, South Carolina 29202, or by delivery at 1501 Lady Street, Columbia, South Carolina 29201) a proxy bearing a later date; or (iii) appearing at the Meeting and voting in person. ANNUAL REPORT The Company's 1998 Annual Report, including Financial Statements, is enclosed with this Proxy Statement. The Form 10-K Annual Report to the Securities and Exchange Commission provides certain additional information. Shareholders may obtain a copy of this Form 10-K Annual Report without charge upon written request addressed to Corporate Secretary, The Seibels Bruce Group, Inc., Post Office Box One, Columbia, South Carolina 29202. If the person requesting a copy is not a shareholder of record, the request must include a representation that he or she is a beneficial owner of the Company's Common Stock. EXPENSES OF SOLICITATION The cost of soliciting proxies will be borne by the Company. Officers, directors, employees and agents of the Company may solicit proxies by telephone, telegram or personal interview, without additional compensation. VOTING Only holders of record of issued and outstanding shares of Common Stock, as of March 22, 1999 (the "Record Date"), will be entitled to notice of and to vote at the Meeting. On the Record Date, there were 7,728,707 shares of Common Stock outstanding. Each share of Common Stock is entitled to one vote, except with respect to Proposal 1, as described below. In accordance with applicable state law and the Company's Articles of Incorporation and Bylaws, abstentions and "broker non-votes" will be counted for purposes of determining whether a quorum is present. "Broker non-votes" occur when a broker or other nominee holding shares for a beneficial owner does not vote on a proposal because the beneficial owner has not checked the applicable box on the proxy card. With respect to Proposal 1, abstentions and "broker non-votes" will not count as either a vote "FOR" or "AGAINST" such Proposal. With respect to Proposal 2, abstentions will be considered entitled to vote and thus will have the effect of a vote "AGAINST" such Proposal while "broker non-votes" will not be considered entitled to vote and thus will not be counted as a vote "FOR" or "AGAINST" such Proposal. In connection with Proposal 1, the election of directors, each shareholder is allowed to cumulate his or her votes and cast as many votes as the number of shares he or she holds multiplied by the number of directors to be elected, the same to be cast for any one candidate or distributed among any two or more candidates. For shares to be voted cumulatively, a shareholder who has the right to cumulate his or her votes shall either (1) give written notice of his or her intention to the President or another officer of the Company not less than 48 hours before the time fixed for the Meeting, which notice must be announced in the Meeting before the voting, or (2) announce his or her intention in the Meeting before the voting for directors commences; and all shareholders entitled to vote at the Meeting shall without further notice be entitled to cumulate their votes. Directors will be elected by a plurality of the votes cast. If a quorum is present: (i) those two nominees who receive the greatest number of votes cast for the election of directors at the Meeting will become directors of the Company at the conclusion of the tabulation of the votes; and (ii) the affirmative vote of the holders of a majority of the shares of Common Stock present in person or by proxy at the Meeting will be required to approve Proposal 2. Participants in the Company's Dividend Reinvestment and Shareholder Purchase Plan (the "DRSP Plan") who have shares of Common Stock registered in their names and who vote those shares on any matter submitted to the Meeting will have all shares credited to their accounts under the DRSP Plan automatically added to that number and voted in the same manner. If such participants do not vote shares registered in their own names, the shares credited to their account in the DRSP Plan will not be voted. An executed proxy will be deemed to include any DRSP shares and will be voted with respect to those shares credited to the participant's account. If a participant desires to vote DRSP Plan shares in person at the Meeting, a proxy for the shares credited to his or her account will be furnished upon written request received by the Company, at the address set forth on the cover of this Proxy Statement, at least fifteen (15) days prior to the date of the Meeting. 1. ELECTION OF DIRECTORS (PROPOSAL 1) One of the purposes of the Meeting is to elect two (2) directors to serve until the 2002 Annual Meeting of Shareholders. Under the Company's Articles of Incorporation, as restated, and Article 3, Section 2 of the Company's Bylaws, the Board of Directors is divided into three classes which shall be as nearly equal in number as possible, with the members of each class serving for three year terms or until their successors are elected or qualified. The shares represented by the proxies solicited hereby will be voted in favor of the election of the persons named below unless authorization to do so is withheld in the proxy. If any of the nominees should be unavailable to serve as a director, which contingency is not presently anticipated, it is the intention of the persons named in the proxies to select and cast their votes for the election of such other person or persons as the Board of Directors may designate. All nominees for election to the Board of Directors are considered and recommended by a Nominating Committee of the Board of Directors. (See "Committees of the Board of Directors.") The full Board of Directors considers the recommendations of that Committee and recommends the nominees to the shareholders. The Company has no procedure whereby nominations are solicited or accepted from shareholders, but the Nominating Committee will consider nominees whose names and business experience are submitted in writing by shareholders to the Corporate Secretary of the Company. Although the Board of Directors does not know whether any nominations will be made at the Meeting other 2 than those set forth in this Proxy Statement, if any such nomination is made, or if votes are cast for any candidate other than those nominated by the Board of Directors, the persons authorized to vote shares represented by executed proxies in the form enclosed with this Proxy Statement (if authority to vote for the election of directors or for any particular nominees is not withheld) will have full discretion and authority to vote cumulatively and allocate votes among any or all of the nominees of the Board of Directors in such order as they may determine. VOTE REQUIRED AND BOARD RECOMMENDATION The affirmative vote of a plurality of votes cast is required to elect directors. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE NOMINEES LISTED BELOW. The following information is set forth with respect to the two (2) nominees for election to be directors as well as the other members of the Board of Directors.
NAME, AGE AND PRINCIPAL EMPLOYMENT FOR PAST FIVE YEARS DIRECTOR SINCE ------------------------------------------------------ -------------- NOMINEES FOR ELECTION TO HOLD OFFICE UNTIL THE 2002 ANNUAL MEETING OF SHAREHOLDERS: Walker S. Powers, 44, is currently a director of the Company and has been a 1997 member of the management of SADISCO Corporation, an automobile salvage company based in Florence, South Carolina ("SADISCO") since 1975. Mr. Powers served as SADISCO's President from 1993 through 1994. Mr. Powers was designated by the Powers Group to serve on the Board of Directors. Walker S. Powers is the son of Charles H. Powers. John P. Seibels, 57, is currently a director of the Company. He also holds 1969(1) a directorship with Policy Management Systems Corporation. Mr. Seibels has been an investor based in Columbia, South Carolina since March 1963. George R.P. Walker, Jr. and John P. Seibels are cousins. DIRECTORS CONTINUING IN OFFICE UNTIL THE 2000 ANNUAL MEETING OF SHAREHOLDERS: Charles H. Powers, 72, is currently Chairman of the Board of Directors of 1997 the Company and is the owner and operator of SADISCO, a position he has held since 1964. He is also a Vice President and Treasurer of Holland Grills, in Apex, North Carolina, and President of PC Inc., in Myrtle Beach, South Carolina. Walker S. Powers is the son of Charles H. Powers. Mr. Powers was designated by the Powers Group to serve on the Board of Directors. Frank H. Avent, 57, is currently a director of the Company. He is a 1997 director, President and General Manager of Pepsi Cola Bottling Company of Florence, South Carolina, a position he has held since 1963. Mr. Avent also serves as a member of the Board of Directors of Atlantic Broadcasting Company, Carolina Canners, Carotex, and Quality Financial Services. Mr. Avent was designated to serve on the Board of Directors by the Avent Group. George R.P. Walker, Jr., 66, is currently a director of the Company and has 1969(1) been the owner and operator of Middlefield Farm (Hanoverian horse farm), Blythewood, South Carolina, for more than the past five years. George R.P. Walker, Jr. and John P. Seibels are cousins.
- ---------- (1) Each present director of the Company with election dates prior to October 1978 (when the Company became the parent of the South Carolina Insurance Company ("SCIC"), the Company's principal subsidiary) was formerly a Director of SCIC and the information set forth as to periods prior to 1978 reflects positions with SCIC and the year such Director was first elected to the SCIC Board of Directors. 3
NAME, AGE AND PRINCIPAL EMPLOYMENT FOR PAST FIVE YEARS DIRECTOR SINCE ------------------------------------------------------ -------------- DIRECTORS CONTINUING IN OFFICE UNTIL THE 2001 ANNUAL MEETING OF SHAREHOLDERS: A. Crawford Clarkson, Jr., 79, is currently a director of the Company. He 1997 is a Certified Public Accountant and attorney. Mr. Clarkson served as Commissioner of the South Carolina Tax Commission from 1987 until 1995, of which he was appointed Chairman in 1992. Prior to 1987, he was a senior partner of the CPA firm of Clarkson, Harden & Gantt, which eventually combined with other firms to join Ernst & Young. Claude E. McCain, 74, is currently a director of the Company. He is also 1995 Chairman of H.C. McCain Agency, Inc., President of McCain Realty, Inc. and President of Insurance Finance Company, Inc. He was formerly a member of the South Carolina State Insurance Commission for 15 years, 10 of which he served as Chairman. Mr. McCain has been in the insurance business since 1946. Kenneth W. Pavia, 56, is currently a director of the Company. He is General 1995 Partner of Bolero Investment Group, a position he has held since 1994. He also holds the office of Chairman of FHI, Inc., a securities holding company and Fiduciary Leasco, Inc., a leasing company, a position held since 1985. Susie H. VanHuss, PhD., 59, is currently a director of the Company. She 1997 currently serves as Executive Director of the USC Foundations at the University of South Carolina. From 1974 through 1997, Dr. VanHuss served as a Professor and as Program Director of management at the University of South Carolina. Prior to serving as Program Director, she served as Interim Dean of the School of Business Administration, also at the University of South Carolina. James L. Zech, 41, is currently a director of the Company. He currently 1997 holds the office of President of the High Ridge Capital LLC, a position he has held since August 1995. From 1992 through 1995, Mr. Zech was Managing Director of S. G. Warburg & Co., Inc. He also is a director of Front Royal Group, Inc. a privately held company based in Raleigh, N.C., and Acordia, Inc., based in Indianapolis, Indiana.
COMMITTEES OF THE BOARD OF DIRECTORS The Board of Directors of the Company has five standing committees: Executive, Audit, Compensation, Investment and Nominating. The Executive Committee is currently composed of Frank H. Avent, A. Crawford Clarkson, Jr., Claude E. McCain, Kenneth W. Pavia, Charles H. Powers, Walker S. Powers and George R.P. Walker, Jr. The Executive Committee exercises the same powers as the Board of Directors, except as otherwise limited by specific prohibitions in South Carolina statutes. The Committee's function is to act in the place of the Board on any matters which require Board action and occur between meetings of the Board. The Executive Committee did not meet during 1998. The Audit Committee is currently composed of John P. Seibels (Chairman), A. Crawford Clarkson, Jr., Claude E. McCain and James L. Zech, none of whom is an officer or employee of the Company. The Committee's functions include recommending independent public accountants to be employed by the Company, reviewing with the independent public accountants their reports and audits, and reporting to the full Board of Directors on their findings. The Audit Committee met six (6) times during 1998. The Compensation Committee is currently composed of Kenneth W. Pavia (Chairman), Frank H. Avent and Charles H. Powers, none of whom is an officer or employee of the Company. For a discussion of certain actions taken with respect to Mr. Powers' membership on the Compensation Committee, please see "Compensation Committee Interlocks and Insider Participation." The Committee's functions are to recommend to the full Board the 4 remuneration arrangements for senior executive officers and for members of the Board of Directors, the adoption of compensation plans in which officers and directors are eligible to participate and the granting of stock options or other benefits under such plan. The Compensation Committee met five (5) times in 1998. The Investment Committee is currently composed of Susie H. VanHuss, PhD. (Chairman), John P. Seibels and George R.P. Walker, Jr. The Committee's functions are to advise the Board of Directors and officers of the Company with respect to investment of the Company's assets and to periodically review, evaluate and report on the performance of the investments of the Company and its subsidiaries. The Investment Committee met three (3) times in 1998. The Nominating Committee is currently composed of Walker S. Powers (Chairman), Claude E. McCain and James L. Zech. The Committee's functions include selecting and recommending nominees for election as new, additional, and replacement directors and reviewing the performance of incumbent directors for nomination for re-election. The Nominating Committee met one (1) time in 1998. The Board of Directors met seven (7) times in 1998. In 1998, each of the incumbent directors attended at least 75% of the meetings of the Board and of the Committee(s) of which he or she was a member held during the period for which he or she served. SECURITY OWNERSHIP OF THE COMPANY The following table sets forth, as of December 31, 1998, information regarding the beneficial ownership of the Company's Common Stock by the directors of the Company, nominees for election, each executive officer named in the Summary Compensation Table that appears under "Executive Compensation -- Summary Compensation Table," all directors and executive officers as a group and each person known to the Company to own 5% or more of its Common Stock.
Name of Beneficial Owner (and address, with Amount and Nature of Percent of Shares of respect to non-directors or non-officers) Beneficial Ownership Common Stock (1) ------------------------------------------- -------------------- -------------------- Frank H. Avent 532,500 (2) 6.63 A. Crawford Clarkson, Jr. 3,775 (3) 0.05 Claude E. McCain 6,266 (4) 0.08 Kenneth W. Pavia 3,750 (5) 0.05 Charles H. Powers 1,699,051 (6) 21.85 Walker S. Powers 252,500 (7) 3.25 John P. Seibels 155,477 (4,8) 2.00
- ---------- (1) The numbers shown include the shares which are not currently outstanding but which certain shareholders are entitled to acquire or will be entitled to acquire within 60 days. (2) Includes 20,000 shares of Common Stock and 12,500 shares of Common Stock underlying certain options for which Mr. Avent has sole voting power and 250,000 shares of Common Stock and 250,000 shares of Common Stock underlying certain options as to which he has shared voting power beneficially owned (shared voting and disposition power) by Pepsi Cola Bottling Company of Florence, South Carolina ("PepsiCo"). Mr. Avent has informed the Company that he is the President and General Manager of PepsiCo. Mr. Avent's address is Post Office Box 3886, Florence, South Carolina 29502. Excludes an aggregate of 30,000 shares of Common Stock and 30,000 shares of Common Stock underlying certain options owned by Mr. Avent's three daughters, of which shares he holds neither sole nor shares voting or dispositive power and, therefore, disclaims beneficial ownership. (3) Includes 1,250 share of Common Stock underlying certain options. (4) Includes 5,000 shares of Common Stock underlying certain options. (5) Includes 3,750 shares of Common Stock underlying certain options. (6) Includes 1,696,551 shares of Common Stock and 2,500 shares of Common Stock underlying certain options. Excludes 62,500 shares of Common stock held by Mr. Powers' daughter and son-in-law, of which shares, he holds neither sole nor shares voting or dispositive power and, therefore, disclaims beneficial ownership. (7) Includes 250,000 shares of Common Stock and 2,500 shares of Common Stock underlying certain options. (8) Excludes 2,253 shares of Common Stock held by Mr. Seibels' wife, of which shares he holds neither sole nor shared voting or dispositive power and, therefore, disclaims beneficial ownership. 5
Name of Beneficial Owner (and address, with Amount and Nature of Percent of Shares of respect to non-directors or non-officers) Beneficial Ownership Common Stock (1) ------------------------------------------- -------------------- -------------------- Susie H. VanHuss, PhD. 3,025 (3,10) 0.04 George R.P. Walker, Jr. 130,464 (4,11) 1.68 James L. Zech 704,374 (12) 8.31 Steven M. Armato 58,743 (13) 0.75 Michael A. Culbertson 54,011 (14) 0.69 Wayne A. Fletcher 36,205 (15) 0.46 Andrew P. Martin 51,931 (16) 0.66 R. Thomas Savage, Jr. 47,241 (17) 0.60 All Directors, Nominees for Director and Executive 3,739,313 (18) 41.62 Officers as a Group PRINCIPAL HOLDERS Avent Group 830,000 (19) 10.14 Franklin Resources, Inc. 650,900 (20) 8.37 Goldman Sachs & Co. 613,900 (21) 7.90 Heartland Advisors, Inc. 500,000 (22) 6.43
- ---------- (9) The numbers shown include the shares which are not currently outstanding but which certain shareholders are entitled to acquire or will be entitled to acquire within 60 days. (10) Excludes 2,250 shares of Common Stock held by Mrs. VanHuss' husband, of which shares she holds neither sole nor shared voting or dispositive power and, therefore, disclaims beneficial ownership. (11) Excludes 11,389 shares of Common Stock held by Mr. Walkers's wife, of which shares he holds neither sole nor shared voting or dispositive power and, therefore, disclaims beneficial ownership. (12) The share ownership for (i) High Ridge Capital, LLC is jointly filed with (ii) High Ridge Capital Partners, LP, (iii) HRC General Partner, LP, (iv) James L. Zech and (v) Steven J. Tynan. Includes 703,124 shares of Common Stock underlying certain options. The information was reported on Form 13D dated January 28, 1998 and filed with the Securities and Exchange Commission. Includes 1,250 shares of Common Stock underlying certain options. The principal address for (i), (ii), (iii), (iv), and (v) is 107 Elm Street, Four Stamford Plaza, Post Office Box 120043, Stamford, Connecticut 06912-0043. (13) Excludes 2,500 shares held by Mr. Armato's wife, of which shares he holds neither sole nor shared voting or dispositive power and, therefore, disclaims beneficial ownership and includes 52,425 shares of Common Stock underlying certain options. (14) Includes 52,425 shares of Common Stock underlying certain options. (15) Includes 33,625 shares of Common Stock underlying certain options. (16) Includes 50,000 shares of Common Stock underlying certain options. (17) Includes 40,000 shares of Common Stock underlying certain options. (18) Includes 1,211,599 shares of Common Stock underlying certain options as held by the above individuals. (19) Includes (i) 270,000 shares of Common Stock and 262,500 shares of Common Stock underlying certain options for which Mr. Frank Avent, a director of the Company, either owns individually or shares voting and dispositive power and (ii) 148,750 shares of Common Stock and 148,750 shares of Common Stock underlying certain options which are owned by other members of the Avent Group. The address for the Avent Group is Post Office Box 3886, Florence, South Carolina 29502. (20) The share ownership for Franklin Resources, Inc. is based on a Form 13G dated February 4, 1999 and filed with the Securities and Exchange Commission. The shares owned by (i) Franklin are beneficially owned by (ii) Charles B. Johnson, a principal shareholder of Franklin, and (iii) Rupert H. Johnson, Jr., a principal shareholder of Franklin, and (iv) Franklin Advisory Services, Inc., investment advisor for Franklin. The principal address for (i), (ii) and (iii) is 777 Mariners Island Boulevard, San Mateo, California 94404, and the principal address for (iv) is One Parker Plaza, Sixteenth Floor Fort Lee, New Jersey 07024. (21) The share ownership for (i) Goldman, Sachs & Co. is jointly filed with the (ii) Goldman Sachs Group, LP and (iii) Goldman Sachs Trust on behalf of Goldman Sachs Small Cap Value Fund based on a Form 13G dated February 16, 1999 and filed with the Securities and Exchange Commission. The principal address for (i), (ii) and (iii) is 85 Broad Street, New York, New York 10004. 6
Name of Beneficial Owner (and address, with Amount and Nature of Percent of Shares of respect to non-directors or non-officers) Beneficial Ownership Common Stock (1) ------------------------------------------- -------------------- -------------------- High Ridge Capital, LLC 703,124 (12) 8.30 Powers Group 2,014,051 (24) 25.89 Wellington Management Company, LLP 749,600 (25) 9.64
- ---------- (22) The share ownership for Heartland Advisors, Inc. is based on a Form 13G dated February 2, 1999 and filed with the Securities and Exchange Commission. The principal address for Heartland Advisors, Inc. is 790 North Milwaukee Street, Milwaukee, Wisconsin 53202. (23) The numbers shown include the shares which are not currently outstanding but which certain shareholders are entitled to acquire or will be entitled to acquire within 60 days. (24) Includes (i) 1,696,551 shares of Common Stock and 2,500 shares of Common Stock underlying certain options which are owned by Mr. Charles H. Powers, a director of the Company, (ii) 250,000 shares of Common Stock and 2,500 shares of Common Stock underlying certain options which are owned by Walker S. Powers, a director of the Company, and (iii) 62,500 shares of Common Stock and 28,124 shares of Common Stock underlying certain options owned by Mr. Charles Powers' daughter and son-in-law. The address for the Powers Group is Post Office Box 6525, Florence, South Carolina 29502. (25) The share ownership for Wellington Management Company, LLP is based on information provided in a 13G dated February 10, 1999 and filed with the Securities and Exchange Commission. Amount beneficially owned is 749,600 with shared voting power of 385,100 and shared power to dispose or to direct the disposition of 749,600. The principal address is 75 State Street, Boston Massachusetts 02109. COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS COMPENSATION OF DIRECTORS In 1998, the Company paid quarterly to each director who was not a full-time employee of the Company a retainer fee of $500 per month plus $750 for each meeting of the Board at which the director was present, and a fee of $500 for each meeting of a Board Committee which he attended. A fee of $1,000 is paid to a director who serves as a Chairman of a Board Committee for attendance at such meeting. Pursuant to the Company's 1995 Stock Option Plan for Non-Employee Directors, on June 16, 1998, each non-employee director serving on that date was granted a non-statutory stock option with a right to buy 1,250 shares of Common Stock. The exercise price of each option is $7.00, which was 100% of the fair market value per share of Common Stock on the date the option was granted. John C. West resigned as Chairman of the Board effective July 31, 1998. Upon his resignation, Mr. West was given the honorary title "Chairman Emeritus" and he became a consultant to the Company. In connection with this consultant arrangement, Mr. West was granted an option to purchase 100,000 shares of Common Stock at an exercise price of $7.25 per share for a term of two years. 7 COMPENSATION OF EXECUTIVE OFFICERS The following table sets forth, for the years ended December 31, 1998, 1997 and 1996, the cash compensation paid by the Company and its subsidiaries, as well as certain other compensation paid or accrued for those years, to each of the Chief Executive Officer and the four most highly compensated executive officers of the Company and such subsidiaries, other than the Chief Executive Officer, whose compensation was in excess of $100,000 (the "Executive Group"), in all capacities in which they serve. SUMMARY COMPENSATION TABLE
Long-term Compensation ---------------------- Annual Compensation Awards Payouts ------------------- ------ ------- Restricted Securities Other Annual Stock Underlying LTIP All Other Name and Principal Salary Bonus Compensation Awards Options Payouts Compensation Position Year ($) ($) ($) ($) (#) ($) ($) - --------------------------- ------- --------- ------- --------------- ----------- ------------ --------- -------------- R. Thomas Savage, Jr. 1998 73,962 0 48,165(1) 4,500 40,000 0 0 Acting President and Chief Executive Officer and Chief Financial Officer(2) Ernst N. Csiszar 1998 389,231 0 0 0 50,000 0 0 President and Chief 1997 225,000 0 0 0 0 0 0 Executive Officer(3) 1996 144,000 50,000 0 0 50,001 0 0 John A. Weitzel 1998 232,631 0 0 0 25,000 0 0 President and Chief 1997 165,600 0 20,000(4) 0 0 0 0 Executive Officer(5) 1996 144,000 25,000 0 0 25,000 0 0 Andrew P. Martin 1998 126,000 10,000 0 14,000 35,000 0 0 President and Chief Operating Officer(6) Wayne A. Fletcher 1998 121,500 10,000 41,202 13,500 23,625 0 0 Vice President(6) Michael A. Culbertson 1998 105,713 2,000 0 11,499 20,125 0 0 Senior Vice President 1997 103,505 0 5,308 11,495 34,103 0 0 Steven M. Armato 1998 105,713 2,500 0 11,499 20,125 0 0 Vice President-Adm 1997 103,505 0 2,289 11,495 34,103 0 0
- ---------- (1) This amount represents relocation expenses paid on behalf of Mr. Savage by the Company, including approximately $39,000 paid to Prudential Relocation Services for assistance with various relocation matters. (2) Elected Chief Financial Officer July 31, 1998. Appointed Acting President and Chief Executive Officer September 21, 1998. (3) Resigned April 15, 1998. (4) The amount shown represents the dollar value of the difference between the price Mr. Weitzel paid to the Company upon the exercise of certain stock options and the fair market value of the Common Stock he received at the date of exercise. (5) Resigned September 16, 1998. (6) Officer of certain subsidiaries. 8 OPTION GRANTS During the year ended December 31, 1998, the Company granted a total of 363,875 stock options to certain members of the Executive Group pursuant to the Company's 1996 Stock Option Plan for Employees. The following table sets forth the grants during the year ended December 31, 1998. OPTIONS/SAR GRANTS DURING THE YEAR ENDED DECEMBER 31, 1998
Number of Percent of Securities Total Potential Realizable Value at Underlying Options/ Exercise Assumed Rates of Stock Price Options/ SARs or Base Appreciation for Option Term SARs Granted Granted to Price Expiration ($) Name (#) Employees ($/Share) Date 5%(1) 10%(1) - --------------------------- -------------- ------------- ------------ ------------- ---------------------------------- R. Thomas Savage, Jr. 40,000 5.16% $7.125 7/6/2003 $0 $0 Ernst N. Csiszar 50,000 6.44% $8.125 3/25/2003 $0 $0 John A. Weitzel 25,000 3.22% $8.125 3/25/2003 $0 $0 Andrew P. Martin 35,000 4.51% $7.25 2/12/2003 $0 $0 Wayne A. Fletcher 23,625 3.04% $7.25 2/12/2003 $0 $0 Michael A. Culbertson 20,125 2.59% $7.25 2/12/2003 $0 $0 Steven M. Armato 20,125 2.59% $7.25 2/12/2003 $0 $0
- ---------- (1) Assumed for illustrative purposes only. 9 OPTION EXERCISES AND YEAR-END HOLDINGS During the year ended December 31, 1998, no member of the Executive Group exercised stock options. The following table sets forth certain information with respect to unexercised stock options held by the Executive Group as of December 31, 1998. Aggregated Option/SAR Exercises During the Year Ended December 31, 1998 and 1998 Year-End Option/SAR Values
Shares Acquired Number of Securities Value of Unexercised On Value Underlying Unexercised In-The-Money Options/SARs at Exercise Realized Options/SARs at Year-End Fiscal Year- End Name (#) ($) (#) Exercisable/Unexercisable Exercisable/Unexercisable - ---------------------------- ----------- ----------- -------------------------------- -------------------------------- R. Thomas Savage, Jr. 0 N/A 13,334/26,666 $0/$0 Ernst N. Csiszar 0 N/A 0/0 $0/$0 John A. Weitzel 0 N/A 36,666/33,334 $2,500/$0 Andrew P. Martin 0 N/A 26,667/23,333 $0/$0 Wayne A. Fletcher 0 N/A 7,875/25,750 $0/$0 Michael A. Culbertson 0 N/A 22,907/29,518 $0/$0 Steven M. Armato 0 N/A 22,907/29,518 $0/$0
EMPLOYMENT AGREEMENTS During 1998, there were no formal employment contracts between any Executive Officer and the Company. Any issue relating to executive compensation would be reviewed by the Compensation Committee, which would recommend a course of action to the Board of Directors. REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION The Compensation Committee of the Company's Board of Directors is responsible for recommending to the full Board the remuneration arrangements for senior executive officers and for members of the Board of Directors, the adoption of compensation plans in which officers and directors are eligible to participate and the granting of stock options or other benefits under such plan. The primary elements of the Company's executive compensation program have historically consisted of a base salary, a bonus opportunity and stock options. Base salaries are determined, and have at times been increased, by evaluating the responsibilities of the position held and the experience of the executive officer. Overall compensation is based on the Compensation Committee's assessment of prevailing market compensation levels. BASE SALARY. Each executive officer's base salary is determined based on a number of factors including the executive officer's responsibilities, contribution to the achievement of the Company's business plan goals, demonstrated leadership skills and overall effectiveness and length of service. Base salaries are designed to be competitive with those offered in markets in which the Company competes for executive talent. Each executive officer's salary is reviewed semi-annually and although these and other factors are considered in setting base salaries, the overall assessment is primarily a subjective one, intended to reflect the level of responsibility and individual performance of the particular executive officer. BONUS OPPORTUNITY. A bonus, if any, is based upon the operations of the Company and recommendations by the Compensation Committee. No bonuses have been paid to Ernst N. Csiszar R, Thomas Savage, Jr. or John A. 10 Weitzel (the "Named Executive Officers") based on their performances during 1998. STOCK OPTIONS. The Compensation Committee recommended and the Board approved a grant of options to each of the Named Executive Officers. The Compensation Committee believes stock option grants to these officers (and other employees) promote success by aligning employee financial interests with long-term shareholder value. Stock option grants are based on various subjective factors primarily relating to the responsibilities of the individual Named Executive Officers, their expected future contributions and prior option grants. The compensation paid to other executive officers was not determined by this Compensation Committee. Currently, compensation for executive officers other than the Named Executive Officers noted above, is determined by the Chief Executive Officer based on the performance of each individual. The foregoing has been provided by the Company's Compensation Committee. Kenneth W. Pavia (Chairman) Frank H. Avent Charles H. Powers THE REPORT OF THE COMPENSATION COMMITTEE SHALL NOT BE DEEMED INCORPORATED BY REFERENCE BY ANY GENERAL STATEMENT INCORPORATING BY REFERENCE THIS PROXY STATEMENT INTO ANY FILING UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (TOGETHER, THE "ACTS"), EXCEPT TO THE EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THIS INFORMATION BY REFERENCE, AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH ACTS. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION On July 31, 1998, the Board of Directors appointed Charles H. Powers Chairman of the Board of Directors. By virtue of the Company's By-laws, the Chairman of the Board of Directors was considered an unpaid officer of the Company from July 31, 1998 until February 12, 1999, when the Board of Direcotrs amended the Company's By-laws to remove such officer designation. On November 12, 1998, the Compensation Committee approved a grant to certain Company employees, including certain executive officers, of options to purchase shares of the Company's Common Stock pursuant to the 1996 Stock Option Plan for Employees (the "Grant"). The Board ratified the Grant by unanimous approval on February 4, 1999. 11 STOCK PERFORMANCE CHART The following chart compares the yearly percentage change in the cumulative total shareholder return on the Company's Common Stock during the five years through December 1998 with the cumulative total return on the NASDAQ Stock Market (U.S. companies) Index and the NASDAQ Fire, Marine and Casualty Insurance Stock Index. COMPARISON OF FIVE YEAR-CUMULATIVE TOTAL RETURNS PERFORMANCE GRAPH FOR THE SEIBELS BRUCE GROUP INC. PREPARED BY THE CENTER FOR RESEARCH IN SECURITY PRICES Produced on 02/19/1999 including data to 12/31/1998 [graph omitted]
LEGEND Symbol CRSP Total Returns Index For: 12/1993 12/1994 12/1995 12/1996 12/1997 12/1998 - ------ ----------------------------- ------- ------- ------- ------- ------- ------- The Seibels Bruce Group Inc. 100.0 142.9 85.7 117.9 107.9 48.2 NASDAQ Stock Market (US Companies) 100.0 97.8 138.3 170.0 208.3 293.5 NASDAQ Stocks (SIC 6330-6339 US Companies) 100.0 96.3 135.0 146.3 222.3 189.5 Fire, Marine, and Casualty Insurance
NOTES: A. The lines represent monthly index levels derived from compounded daily returns that include all dividends. B. The indexes are reweighted daily, using the market capitalization on the previous trading day. C. If the monthly interval, based on the fiscal year-end, is not a trading day, the preceding trading day is used. D. The index level for all series was set to $100.0 on 12/31/1993. THE STOCK PRICE PERFORMANCE GRAPH SHALL NOT BE DEEMED INCORPORATED BY REFERENCE BY ANY GENERAL STATEMENT INCORPORATING BY REFERENCE THIS PROXY STATEMENT INTO ANY FILING UNDER THE ACTS, EXCEPT TO THE EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THIS INFORMATION BY REFERENCE, AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH ACTS. 12 CERTAIN TRANSACTIONS Mr. John C. West, chairman emeritus of the Board of Directors of the Company, is of counsel to the law firm of Bethea, Jordan & Griffin. Bethea, Jordan & Griffin has been retained by the Company to perform legal services. During the fiscal year ended December 31, 1998, the Company paid a total of $40,136 to Bethea, Jordan & Griffin. During the fiscal year ended December 31, 1998, the Company paid a total of $521,738 to SADISCO Corporation ("SADISCO") of which $53,800 was for salvage and disposal services provided to the Company in the ordinary course of business and $467,938 was for reimbursement of expenses advanced by SADISCO on behalf of the Company in connection with such services. Charles H. Powers, chairman of the Board of Directors of the Company, is the owner and operator of SADISCO. SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's officers, directors and persons who own more than ten percent of the Company's equity securities to file initial reports of ownership and changes in ownership with the Securities and Exchange Commission and to furnish the Company with all such forms they file. Based solely on the Company's review of the forms it has received and on written representations from certain reporting persons that no such forms were required for them, the Company believes that for the fiscal year ended December 31, 1998, the Section 16(a) filing requirements applicable to its officers, directors and greater than ten percent beneficial owners were in compliance, with the exception of Charles H. Powers, who filed a late Form 4 relating to certain shares transferred. 2. RATIFICATION OF SELECTION OF ARTHUR ANDERSEN LLP TO BE INDEPENDENT ACCOUNTANTS FOR THE COMPANY (PROPOSAL 2) One of the purposes of the Meeting is to ratify the selection of independent accountants to audit the books, records, and accounts of the Company and its subsidiaries for the year ending December 31, 1999. Arthur Andersen LLP has served as the Company's independent accountants since December 28, 1992. On February 4, 1999, acting on the recommendation of the Audit Committee, the Board of Directors adopted resolutions directing the employment of Arthur Andersen LLP to audit the books, records, and accounts of the Company for 1999 and the submission of the selection to the shareholders for ratification. Accordingly, the Board recommends the approval of the following resolution: RESOLVED, that the selection by the Board of Directors of the firm of Arthur Andersen LLP to audit the books, records, and accounts of the Company and its subsidiaries for the year ending December 31, 1999, be ratified. A representative of Arthur Andersen LLP is expected to be present at the Meeting and will have the opportunity to make a statement, and will be available to answer questions from shareholders. Approval by the Shareholders of the appointment of independent auditors is not required but the Board deems it desirable to submit this matter to the Shareholders. If holders of a majority of the Shares of Common Stock present and entitled to vote at the Meeting should not approve the selection of Arthur Andersen LLP, the Board will consider the selection of another accounting firm. VOTE REQUIRED AND BOARD RECOMMENDATION The affirmative vote by the holders of a majority of the votes cast in person or by proxy at the Meeting is required for approval of Proposal 2. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THE APPOINTMENT OF INDEPENDENT ACCOUNTANTS. SHAREHOLDER PROPOSALS For a shareholder proposal to be presented at the next annual meeting, it must be received by the Company 13 at its principal executive offices not later than December 10, 1999, in order to be included in the proxy statement and proxy form for the 2000 annual meeting. Any such proposal should be addressed to the Company's Corporate Secretary and delivered to the Company's principal executive offices at 1501 Lady Street, Columbia, South Carolina 29201 or mailed to Post Office Box One, Columbia, South Carolina 29202. OTHER BUSINESS There is no reason to believe that any other business will be presented at this Meeting; however, if any other business should properly and lawfully come before the Meeting, the proxies will vote in accordance with their best judgment. /s/ Matt P. McClure -------------------- Matt P. McClure Corporate Secretary -----END PRIVACY-ENHANCED MESSAGE-----