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Over Investor's Objections, Directors Re-Elected at Va. Bank

A dozen directors were re-elected at Middleburg Financial in Virginia despite a protest from the company's biggest investor.

The $1.3 billion-asset Middleburg disclosed in a regulatory filing that its shareholders approved one-year terms for all 12 directors up for election during last week's annual meeting. Four candidates, including President and Chief Executive Gary Shook, prevailed even though the number of shares withheld outnumbered shares that voted for their re-election.

The results were a result of plurality voting and a lack of alternative candidates. Still, David Sokol, CEO of Teton Capital in Jackson, Wyo., made good on his vow to withhold support for the nominees. Sokol, who owns about 30% of Middleburg's stock, has been pushing the company to sell itself; he recently hired a law firm and an investment bank specializing in bank M&A.

Middleburg said in a statement Monday that it had offered Sokol a board seat "on numerous occasions," including as recently as March 30, but the investor had "repeatedly declined" the offer. "We remain committed to executing on our strategic initiatives to grow the business, deliver robust financial performance and enhance shareholder value," the statement said.

An investment bank working with Sokol did not respond to a request for comment.

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