Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the registrant [x]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[x] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
MITCHELL BANCORP, INC.
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(Name of Registrant as Specified in Its Charter)
MITCHELL BANCORP, INC.
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(Name of Person(s) 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:
N/A
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(2) Aggregate number of securities to which transactions applies:
N/A
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
N/A
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(4) Proposed maximum aggregate value of transaction:
N/A
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[x] 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:
N/A
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(2) Form, schedule or registration statement no.:
N/A
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(3) Filing party:
N/A
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(4) Date filed:
N/A -
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September 18, 1997
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders
of Mitchell Bancorp, Inc. The meeting will be held at the main office of
Mitchell Savings Bank, Inc., SSB located at 210 Oak Avenue, Spruce Pine, North
Carolina, on Wednesday, October 22, 1997, at 2:00 p.m., local time.
The Notice of Annual Meeting of Shareholders and Proxy Statement
appearing on the following pages describe the formal business to be transacted
at the meeting. During the meeting, we will also report on the operations of
the Corporation. Directors and officers of the Corporation, as well as a
representative of Crisp Hughes & Co., L.L.P., the Corporation's independent
auditors, will be present to respond to appropriate questions of shareholders.
It is important that your shares are represented at this meeting,
whether or not you attend the meeting in person and regardless of the number of
shares you own. To make sure your shares are represented, we urge you to
complete and mail the enclosed proxy card. If you attend the meeting, you may
vote in person even if you have previously mailed a proxy card.
We look forward to seeing you at the meeting.
Sincerely,
/s/Edward Ballew, Jr.
Edward Ballew, Jr.
Executive Vice President
and Chief Executive Officer
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MITCHELL BANCORP, INC.
210 Oak Avenue
Spruce Pine, North Carolina 28777
(704) 765-7324
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held On October 22, 1997
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NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
Mitchell Bancorp, Inc. ("Corporation") will be held at the main office of
Mitchell Savings Bank, Inc., SSB located at 210 Oak Avenue, Spruce Pine, North
Carolina, on Wednesday, October 22, 1997, at 2:00 p.m., local time, for the
following purposes:
(1) To elect six directors to serve until the 1998 Annual
Meeting of Shareholders;
(2) To consider and act upon such other matters as may
properly come before the meeting or any adjournments
thereof.
NOTE: The Board of Directors is not aware of any other business to
come before the meeting.
Any action may be taken on the foregoing proposals at the meeting on
the date specified above or on any date or dates to which, by original or later
adjournment, the meeting may be adjourned. Shareholders of record at the close
of business on September 2, 1997 are entitled to notice of and to vote at the
meeting and any adjournments or postponements thereof.
You are requested to complete and sign the enclosed form of proxy,
which is solicited by the Board of Directors, and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend the meeting and
vote in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/Emma Lee M. Wilson
EMMA LEE M. WILSON
SECRETARY
Spruce Pine, North Carolina
September 18, 1997
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE CORPORATION THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN
THE UNITED STATES.
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PROXY STATEMENT
OF
MITCHELL BANCORP, INC.
210 OAK AVENUE
SPRUCE PINE, NORTH CAROLINA 28777
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ANNUAL MEETING OF SHAREHOLDERS
October 22, 1997
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This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Mitchell Bancorp, Inc. ("Corporation"),
the holding company for Mitchell Savings Bank, Inc., SSB ("Savings Bank"), to be
used at the Corporation's Annual Meeting of Shareholders ("Annual Meeting").
The Annual Meeting will be held at the Savings Bank's main office located at 210
Oak Avenue, Spruce Pine, North Carolina on Wednesday, October 22, 1997, at 2:00
p.m., local time. This Proxy Statement and the enclosed proxy card are being
first mailed to shareholders on or about September 18, 1997.
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VOTING AND PROXY PROCEDURE
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Shareholders of record as of the close of business on September 2,
1997 are entitled to one vote for each share of common stock ("Common Stock") of
the Corporation then held. As of September 2, 1997, the Corporation had 930,902
shares of Common Stock issued and outstanding. The presence, in person or by
proxy, of at least a majority of the total number of outstanding shares of
Common Stock entitled to vote is necessary to constitute a quorum at the Annual
Meeting. Abstentions will be counted as shares present and entitled to vote at
the Annual Meeting for purposes of determining the existence of a quorum.
Broker non-votes will not be considered shares present and will not be included
in determining whether a quorum is present.
The Board of Directors solicits proxies so that each shareholder has
the opportunity to vote on the proposals to be considered at the Annual Meeting.
When a proxy card is returned properly signed and dated, the shares represented
thereby will be voted in accordance with the instructions on the proxy card.
Where no instructions are indicated, proxies will be voted FOR the nominees for
directors set forth below. If a shareholder attends the Annual Meeting, he or
she may vote by ballot. If a shareholder does not return a signed proxy card or
does not attend the Annual Meeting and vote in person, his or her shares will
not be voted.
Shareholders who execute proxies retain the right to revoke them at
any time. Proxies may be revoked by written notice delivered in person or
mailed to the Secretary of the Corporation or by filing a later proxy prior to a
vote being taken on a particular proposal at the Annual Meeting. Attendance at
the Annual Meeting will not automatically revoke a proxy, but a shareholder in
attendance may request a ballot and vote in person, thereby revoking a prior
granted proxy.
The six directors to be elected at the Annual Meeting will be elected
by a plurality of the votes cast by shareholders present in person or by proxy
and entitled to vote. Shareholders are not permitted to cumulate their votes
for the election of directors. With respect to the election of directors, votes
may be cast for or withheld from each nominee. Votes that are withheld and
broker non-votes will have no effect on the outcome of the election because
directors will be elected by a plurality of votes cast.
If a shareholder is a participant in the Mitchell Savings Bank, Inc.,
SSB Employee Stock Ownership Plan ("ESOP"), the proxy card represents a voting
instruction to the trustees of the ESOP as to the number of shares in the
participant's plan account. Each participant in the ESOP may direct the
trustees as to the manner in which shares of Common Stock allocated to the
participant's plan account are to be voted. Unallocated shares of Common Stock
held by the ESOP and allocated shares for which no voting instructions are
received will be voted by the trustees in the same proportion as shares for
which the trustees have received voting instructions.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
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Persons and groups who beneficially own in excess of 5% of the
Corporation's Common Stock are required to file certain reports disclosing such
ownership pursuant to the Securities Exchange Act of 1934, as amended ("Exchange
Act"). Based on such reports, the following table sets forth, as of September
2, 1997, certain information as to those persons who were beneficial owners of
more than 5% of the outstanding shares of Common Stock. Management knows of no
persons other than those set forth below who beneficially owned more than 5% of
the outstanding shares of Common Stock at September 2, 1997. The following
table also sets forth, as of September 2, 1997, information as to the shares of
Common Stock beneficially owned by each director, by the named executive
officers of the Corporation, and by all executive officers and directors of the
Corporation as a group.
Number of Shares Percent of Shares
Name Beneficially Owned (1) Outstanding
- ---- ---------------------- -----------------
Beneficial Owners
of More Than 5%
Mitchell Savings
Bank, Inc., SSB
Employee Stock
Ownership Plan Trust 78,391 8.42%
Jerome H. and
Susan B. Davis (2) 93,000 9.99%
Great Meadows, Inc. (3)
Samuel L. Phillips
Van F. Phillips
G. Byron Phillips
Gina A. Phillips 97,650 10.49%
Directors
Calvin F. Hall 12,190 1.31%
Emma Lee M. Wilson 11,000 1.18%
Baxter D. Johnson 2,000 *
Lloyd Hise, Jr. 5,005 *
Michael B. Thomas 3,165 *
Named Executive Officers(4)
Edward Ballew, Jr. 12,190 1.31%
All Executive Officers and 45,550 4.89%
Directors as a Group (6 persons)
_______________
* Less than 1 percent of shares outstanding.
(1) In accordance with Rule 13d-3 under the Exchange Act, a person is deemed
to be the beneficial owner, for purposes of this table, of any shares of
Common Stock if he or she has voting or investment power with respect to
such security. The table includes shares owned by spouses, other
immediate family members in trust, shares held in retirement accounts or
funds for the benefit of the named individuals, and other forms of
ownership, over which shares the persons named in the table may possess
voting and/or investment power.
2
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(2) As disclosed in a Schedule 13D filed with the Securities and Exchange
Commission ("SEC") on July 19, 1996, as subsequently amended on November
19, 1996 and May 5, 1997.
(3) As disclosed in a Schedule 13D filed with the SEC on August 19, 1996.
(4) Under SEC regulation, the term "named executive officer" is defined to
include the chief executive officer, regardless of compensation level,
and the four most highly compensated executive officers, other than the
chief executive officer, whose total annual salary and bonus for the
last completed fiscal year exceeded $100,000. Edward Ballew, Jr. was
the Corporation's only "named executive officer" for the fiscal year
ended June 30, 1997. He is also a director of the Corporation.
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PROPOSAL I -- ELECTION OF DIRECTORS
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The Corporation's Board of Directors consists of six members. The
Board of Directors was increased from five to six members with the appointment
of Michael B. Thomas on August 18, 1997. Pursuant to the Corporation's Bylaws,
all six of the Corporation's Directors are standing for election at the Annual
Meeting. The following table sets forth the names of the Board of Directors'
nominees for election as directors. All nominees are current members of the
Board of Directors.
If any nominee is unable to serve, the shares represented by all valid
proxies will be voted for the election of such substitute as the Board of
Directors may recommend or the Board of Directors may adopt a resolution to
amend the Bylaws and reduce the size of the Board. At this time the Board of
Directors knows of no reason why any nominee might be unavailable to serve.
The Board of Directors recommends a vote "FOR" each of the nominees
named in the following table as directors of the Corporation.
Year First
Elected
or Appointed Term to
Name Age (1) Director (2) Expire (3)
---- ------- ------------ ----------
Calvin F. Hall 68 1974 1998
Edward Ballew, Jr. 75 1948 1998
Emma Lee M. Wilson 61 1983 1998
Baxter D. Johnson 87 1952 1998
Lloyd Hise, Jr. 52 1988 1998
Michael B. Thomas 42 1997 1998
______________
(1) As of June 30, 1997.
(2) Includes prior service on the Board of Directors of the Savings Bank, if
any.
(3) Assuming the individual is elected or re-elected at the Annual Meeting.
The present principal occupation and other business experience during
the last five years of each nominee for election and each director continuing in
office is set forth below:
Calvin F. Hall is President and an agent of Fortner Insurance Agency,
Inc., with which he has been affiliated with for over 38 years. Mr. Hall was
appointed President of the Savings Bank in January 1995. Mr. Hall is a member
of the Spruce Pine Rotary Club.
Edward Ballew, Jr. has been employed as an executive officer by the
Savings Bank since 1947 and serves as its Executive Vice President and Chief
Executive Officer.
3
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Emma Lee M. Wilson has been employed by the Savings Bank since 1958
and has served in various capacities since that time. Mrs. Wilson is the
Assistant Managing Officer, Secretary and Treasurer of the Savings Bank.
Baxter D. Johnson has been the owner of Johnson Electric, Spruce
Pine, North Carolina, for 67 years.
Lloyd Hise, Jr. has been a practicing attorney in Spruce Pine, North
Carolina since 1969.
Michael B. Thomas is a salesman for Buck Stove, Inc., Spruce Pine,
North Carolina. He is a past president of the Mitchell County Chamber of
Commerce and has served on the Town of Spruce Pine Board of Alderman.
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MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
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The Boards of Directors of the Corporation and the Savings Bank
conduct their business through meetings of the Boards and through their
committees. During the fiscal year ended June 30, 1997, the Board of Directors
of the Corporation held five meetings, and the Board of Directors of the Savings
Bank held 12 meetings. No director of the Corporation or the Savings Bank
attended fewer than 75% of the total meetings of the Boards and committees on
which such person served during this period.
The Board of Directors of the Corporation has an Audit Committee
consisting of Directors Hise, Hall and Johnson, which is responsible for meeting
with the Corporation's outside auditor to discuss the results of the annual
audit and any related matters. The Audit Committee is also responsible for
employee compliance issues. The Board also receives and reviews the reports and
findings and other information presented to them by the Corporation's outside
auditor. The Audit Committee meets as needed and met three times during the
fiscal year ended June 30, 1997.
The Loan Committee, consisting of Messrs. Hall, Ballew and Mrs.
Wilson, meets as needed and is responsible for reviewing and approving the
Savings Bank's loans. The Loan Committee met approximately 24 times during the
fiscal year ended June 30, 1997.
The Compensation Committee, consisting of Directors Ballew, Hise and
Wilson, makes recommendations to the full Board of Directors concerning employee
compensation. The Compensation Committee meets as needed and met three times
during the fiscal year ended June 30, 1997.
The Board of Directors of the Corporation acts as a nominating
committee for selecting the nominees for election as directors. During the
fiscal year ended June 30, 1997, the Board of Directors met once in its capacity
as nominating committee to select nominees for election at the Annual Meeting.
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DIRECTORS' COMPENSATION
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Board Fees
Except for the President who receives a monthly fee of $1,000,
directors of the Savings Bank received a fee of $500 per month during the year
ended June 30, 1997. Director fees totalled $36,000 for the year ended June 30,
1997. Directors do not receive any additional compensation for serving on
committees of the Board of Directors. No separate fees are paid for service on
the Board of Directors of the Corporation.
4
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Directors' Retirement Plan
The Savings Bank established a retirement plan for incumbent directors
in 1994. The intent of the plan is to compensate directors for their past
services to the Savings Bank and to provide incentives for continued service to
the Savings Bank to ensure its continued success and to provide management of
the Savings Bank with the benefits of the expertise and experience of its
directors. Normal retirement age under the plan is age 62. The plan provides a
normal retirement benefit equal to $500 per month for a period of 120 months
following retirement. However, the Savings Bank may elect to pay the normal
retirement benefit in a lump sum at any time following a director's retirement.
The plan also provides for the payment of benefits equal to the normal
retirement benefit in the case of a director who dies or becomes disabled prior
to retirement. Directors who participate in the plan are subject to a
noncompetition restriction during the benefit payment period. In addition, a
retired director is obligated to provide consulting services to the Savings Bank
during such period. Plan expenses totalled $17,000 for the fiscal year ended
June 30, 1997.
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EXECUTIVE COMPENSATION
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Summary Compensation Table
Annual Compensation(1)
---------------------------------------
Other
Annual All Other
Name and Compen- Compen-
Position Year Salary(1) Bonus sation(2) sation($)(3)
- -------- ---- --------- ----- --------- ------------
Edward Ballew, Jr. 1997 $ 73,800 $ -- -- $31,647
Executive Vice
President 1996 74,000 6,200 -- --
and Chief
Executive Officer 1995 68,250 8,100 -- --
- -------------------
(1) Includes Board of Directors fees of $6,000.
(2) Excludes perquisites which, in the aggregate, did not exceed the
lesser of $50,000 or 10% of salary and bonus.
(3) Represents contribution made to the ESOP.
Employment Agreements
Effective December 31, 1995, the Savings Bank entered into three-year
employment agreements with Mr. Ballew and Mrs. Wilson (individually, the
"Executive"). The agreements provide for the extension of the term of the
agreement for an additional year annually unless the Savings Bank provides the
Executive with prior notice that the current term will not be extended. The
agreements provide for an initial salary level for Mr. Ballew and Mrs. Wilson of
$72,000 and $58,000, respectively. Under the agreements, the compensation of
each Executive is subject to annual review. In addition, each Executive is
eligible to participate in all employee benefit plans or arrangements which the
Savings Bank makes available to its senior executive officers. The agreements
provide that upon the Executive's termination of employment without cause or the
Executive's resignation following the occurrence of certain events, including a
material change in the Executive's functions, duties or responsibilities, the
Savings Bank will make a severance payment equal to the greater of the payments
due to the Executive over the remaining term of the agreement or three times the
average of the Executive's base salary over the preceding three years. In
addition, the Savings Bank is obligated to continue the Executive's life, dental
and disability coverage through the expiration of the current term of the
agreement. The agreements also restrict the Executive's right to compete
against the Savings Bank for a period of two years from the date of the
Executive's termination without cause or resignation in the circumstances
described above.
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In connection with the Savings Bank's mutual to stock conversion, the
agreements were amended to provide for severance payments and continuation of
other employee benefits in the event of the Executive's involuntary termination
of employment in connection with any change in control of the Savings Bank or
the Corporation. Severance payments also will be provided on a similar basis in
connection with voluntary termination of employment where, subsequent to a
change in control, Mr. Ballew and Mrs. Wilson are assigned duties inconsistent
with their positions, duties, responsibilities and status immediately prior to
such change in control. The term "change in control" will be defined as having
occurred when, among other things, (i) a person other than the Corporation
purchases shares of Common Stock pursuant to a tender or exchange offer for such
shares, (ii) any person (as such term is used in Sections 13(d) and 14(d)(2) of
the Exchange Act) is or becomes the beneficial owner, directly or indirectly, of
securities of the Corporation representing 25% or more of the combined voting
power of the Corporation's then outstanding securities, (iii) the membership of
the Board of Directors changes as the result of a contested election, or (iv)
shareholders of the Corporation approve a merger, consolidation, sale or
disposition of all or substantially all of the Corporation's assets, or a plan
of partial or complete liquidation.
The severance payments from the Savings Bank will equal 2.99 times
each Executive's average annual compensation during the five-year period
preceding the change in control. Such amount will be paid in a lump sum within
10 business days following the termination of employment. Assuming that a
change in control had occurred at June 30, 1997, Mr. Ballew and Mrs. Wilson
would be entitled to severance payments of approximately $210,000 and $165,000,
respectively. Section 280G of the Internal Revenue Code of 1986, as amended
("Code"), states that severance payments that equal or exceed three times the
base compensation of the individual are deemed to be "excess parachute payments"
if they are contingent upon a change in control. Individuals receiving excess
parachute payments are subject to a 20% excise tax on the amount of such excess
payments, and the Executives would not be entitled to deduct the amount of such
excess payments.
Compensation Committee Interlocks and Insider Participation.
Mr. Ballew, Executive Vice President and Chief Executive Officer of
the Corporation, serves as a member of the Compensation Committee. Although the
Chief Executive Officer recommends compensation to be paid to executive
officers, the entire Board of Directors of the Savings Bank reviews such
recommendations and sets the compensation for Mr. Ballew.
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COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
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Section 16(a) of the Exchange Act requires the Corporation's executive
officers and directors, and persons who own more than 10% of any registered
class of the Corporation's equity securities, to file reports of ownership and
changes in ownership with the SEC. Executive officers, directors and greater
than 10% shareholders are required by regulation to furnish the Corporation with
copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms it has received
and written representations provided to the Corporation by the above referenced
persons, the Corporation believes that all filing requirements applicable to its
reporting officers, directors and greater than 10% shareholders were properly
and timely complied with for the fiscal year ended June 30, 1997.
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TRANSACTIONS WITH MANAGEMENT
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Current law requires that all loans or extensions of credit to
executive officers and directors must be made on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons and does not involve more than the
normal risk of repayment or present other unfavorable features. The Savings
Bank therefore is prohibited from making any new loans or extensions of credit
to the Savings Bank's executive officers and directors and at different rates or
terms than those offered to the
6
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general public and has adopted a policy to this effect. The aggregate amount
of loans by the Savings Bank to its executive officers and directors was
approximately $65,000 at June 30, 1997. Such loans (i) were made in the
ordinary course of business, (ii) were made on substantially the same terms and
conditions, including interest rates and collateral, as those prevailing at the
time for comparable transactions with the Savings Bank's other customers,
(unless the loan or extension of credit is made under a benefit program
generally available to all other employees and does not give preference to any
insider over any other employee) and (iii) did not involve more than the normal
risk of collectibility or present other unfavorable features when made.
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AUDITORS
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The Board of Directors has appointed Crisp Hughes & Co., L.L.P.,
independent public accountants, to serve as the Corporation's auditors for the
fiscal year ending June 30, 1998. A representative of Crisp Hughes & Co.,
L.L.P. is expected to be present at the Annual Meeting to respond to appropriate
questions from shareholders and will have the opportunity to make a statement if
he or she so desires.
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OTHER MATTERS
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The Board of Directors is not aware of any business to come before the
Annual Meeting other than those matters described above in this Proxy Statement.
However, if any other matters should properly come before the Annual Meeting, it
is intended that proxies in the accompanying form will be voted in respect
thereof in accordance with the judgment of the person or persons voting the
proxies.
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MISCELLANEOUS
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The cost of solicitation of proxies will be borne by the Corporation.
The Corporation will reimburse brokerage firms and other custodians, nominees
and fiduciaries for reasonable expenses incurred by them in sending proxy
materials to the beneficial owners of the Common Stock. In addition to
solicitations by mail, directors, officers and regular employees of the
Corporation may solicit proxies personally, by telecopier or by telephone
without additional compensation.
The Corporation's 1997 Annual Report to Shareholders, including
consolidated financial statements, has been mailed to all shareholders of record
as of the close of business on September 2, 1997. Any shareholder who has not
received a copy of the Annual Report may obtain a copy by writing to the
Corporation. The Annual Report is not to be treated as part of the proxy
solicitation material or having been incorporated herein by reference.
A copy of the Corporation's Form 10-KSB for the fiscal year ended June
30, 1997, as filed with the SEC, will be furnished without charge to
shareholders of record as of September 2, 1997 upon written request to Emma Lee
M. Wilson, Secretary, Mitchell Bancorp, Inc., 210 Oak Avenue, Spruce Pine, North
Carolina 28777.
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SHAREHOLDER PROPOSALS
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Proposals of shareholders intended to be presented at the
Corporation's annual meeting to be held in October 1998 must be received by the
Corporation no later than May 22, 1998 to be considered for inclusion in the
proxy solicitation materials and form of proxy relating to such meeting. Any
such proposals shall be subject to the requirements of the proxy solicitation
rules adopted under the Exchange Act.
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The Corporation's Bylaws provide that, in order for a shareholder to
make nominations for the election of directors at the Annual Meeting, a
shareholder must deliver written notice of such nominations to the Secretary not
less than 50 nor more than 90 days prior to the date of the Annual Meeting;
provided that if less than 21 days' notice of the Annual Meeting is given to
shareholders, such notice must be delivered to the Secretary of the Corporation
not later than the close of business on the seventh day following the day on
which notice of the Annual Meeting was mailed to shareholders.
BY ORDER OF THE BOARD OF DIRECTORS
/s/Emma Lee M. Wilson
EMMA LEE M. WILSON
SECRETARY
Spruce Pine, North Carolina
September 18, 1997
8
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REVOCABLE PROXY
MITCHELL BANCORP, INC.
ANNUAL MEETING OF SHAREHOLDERS
OCTOBER 22, 1997
The undersigned hereby appoints the official Proxy Committee of the
Board of Directors of Mitchell Bancorp, Inc. ("Corporation") with full powers of
substitution to act as attorneys and proxies for the undersigned, to vote all
shares of Common Stock of the Corporation which the undersigned is entitled to
vote at the Annual Meeting of Shareholders, to be held at the main office of
Mitchell Savings Bank, Inc., SSB located at 210 Oak Avenue, Spruce Pine, North
Carolina, on Wednesday, October 22, 1997, at 2:00 p.m., local time, and at any
and all adjournments thereof, as follows:
FOR WITHHELD
1. The election as director of the nominees
listed below (except as marked to the [ ] [ ]
contrary below).
Calvin F. Hall
Edward Ballew, Jr.
Emma Lee M. Wilson
Baxter D. Johnson
Lloyd Hise, Jr.
Michael B. Thomas
INSTRUCTIONS: To withhold your vote
for any individual nominee, write the
nominee's name(s) on the line below.
-------------------------------------
2. In their discretion, upon such other matters
as may properly come before the meeting.
The Board of Directors recommends a vote "FOR" the listed proposition.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED THIS
PROXY WILL BE VOTED FOR THE PROPOSITION STATED. IF ANY OTHER BUSINESS IS
PRESENTED AT SUCH MEETING, THIS PROXY WILL BE VOTED BY THE BOARD OF DIRECTORS IN
ITS BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO
OTHER BUSINESS TO BE PRESENTED AT THE ANNUAL MEETING. THIS PROXY ALSO CONFERS
DISCRETIONARY AUTHORITY ON THE BOARD OF DIRECTORS TO VOTE WITH RESPECT TO THE
ELECTION OF ANY PERSON AS DIRECTOR WHERE THE NOMINEES ARE UNABLE TO SERVE OR FOR
GOOD CAUSE WILL NOT SERVE AND MATTERS INCIDENT TO THE CONDUCT OF THE ANNUAL
MEETING.
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THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and elect to vote at the Annual
Meeting or at any adjournment thereof and after notification to the Secretary of
the Corporation at the Annual Meeting of the shareholder's decision to terminate
this proxy, then the power of said attorneys and proxies shall be deemed
terminated and of no further force and effect.
The undersigned acknowledges receipt from the Corporation prior to the
execution of this proxy of the Notice of Annual Meeting of Shareholders, a Proxy
Statement for the Annual Meeting dated September 18, 1997, and the 1997 Annual
Report to Shareholders.
Dated: _____________, 1997
- --------------------------------- ------------------------------
PRINT NAME OF SHAREHOLDER PRINT NAME OF SHAREHOLDER
- --------------------------------- ------------------------------
SIGNATURE OF SHAREHOLDER SIGNATURE OF SHAREHOLDER
Please sign exactly as your name appears on the enclosed card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE.
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