SCHEDULE 14A
(Rule 14a-101)
Information Required in Proxy Statement
SCHEDULE 14A INFORMATION
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 [ ]
Check the appropriate box:
<TABLE>
<CAPTION>
<S> <C>
[ ] 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
</TABLE>
F & M BANK CORP.
- --------------------------------------------------------------------------------
(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):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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:
.....................................................................
<PAGE>
F & M BANK CORP.
Timberville, Virginia
Notice of Annual Meeting of Shareholders
To the Shareholders of F & M Bank Corp.
The annual meeting of shareholders of F & M Bank Corp. (the Company)
will be held on Saturday, April 11, 1998, at 5:30 P.M. at the McGaheysville Fire
Department Activity Building, McGaheysville, Virginia, for the following
purposes:
1. Election of four directors for three-year terms expiring in 2001.
2. Ratification of the appointment of S. B. Hoover & Company, L.L.P.
as independent auditors for 1998.
3. Amendment of the Articles of Incorporation to increase the
authorized common stock of the Company from 2,000,000 shares to
3,000,000 shares.
4. Transaction of such other business as may properly come before the
meeting. Management is not aware of any other business, other than
procedural matters incident to the conduct of the Annual Meeting.
Only shareholders of record at the close of business on February 27,
1998 are entitled to notice of and to vote at the annual meeting or any
adjournments thereof.
To assure that your shares are represented at the annual meeting,
please complete, date and sign the enclosed proxy, and return it as soon as
possible in the enclosed postage prepaid envelope. You may revoke your proxy at
any time prior to its exercise.
By Order of the Board of Directors
Larry A. Caplinger, Secretary
March 13, 1998
<PAGE>
F & M BANK CORP.
P. O. Box 1111
Timberville, Virginia 22853
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation
of proxies for use at the annual meeting of shareholders of F & M Bank Corp.
(the Company) to be held Saturday, April 11, 1998 at 5:30 P.M. at the
McGaheysville Fire Department Activity Building, McGaheysville, Virginia, and at
any adjournments thereof (the Annual Meeting). The principal executive offices
of the Company are located on Main Street, Timberville, Virginia 22853. The
approximate mailing date of this Proxy Statement and the accompanying proxy is
March 13, 1998.
The accompanying proxy is solicited by the Board of Directors of the
Company (the Board). The cost of the solicitation of proxies will be borne by
the Company. Solicitations will be made only by the use of the mail, except
that, if necessary, officers, directors and regular employees of the Company, or
its affiliates, may make solicitations of proxies by telephone, telegraph or by
personal calls. Brokerage houses and nominees may be requested to forward the
proxy solicitation material to the beneficial owners of the stock held of record
by such persons, and the Company may reimburse them for their charges and
expenses in this regard.
All properly executed proxies delivered pursuant to this solicitation
will be voted at the Annual Meeting in accordance with any instructions thereon.
Any person signing and mailing the enclosed proxy may, nevertheless, revoke the
proxy at any time prior to the actual voting thereof by (i) filing written
notice thereof with the Secretary of the Company (Larry A. Caplinger, Secretary,
F & M Bank Corp., P. O. Box 1111, Timberville, Virginia 22853); (ii) submitting
a duly executed proxy bearing a later date; or (iii) appearing at the Annual
Meeting or any adjournment thereof and giving the Secretary notice of his or her
intention to vote in person.
An Annual Report to shareholders, including current financial
statements, is being mailed to the Company's shareholders concurrently with this
Proxy Statement, but is not part of the proxy solicitation materials.
Interested shareholders may obtain, without charge, a copy of the
Company's Form 10-KSB for the fiscal year ended December 31, 1997, as filed with
the Securities and Exchange Commission, upon written request to Larry A.
Caplinger, Secretary, F & M Bank Corp., P. O. Box 1111, Timberville, Virginia
22853.
OUTSTANDING SHARES AND VOTING RIGHTS
Only shareholders of record at the close of business on February 27,
1998 will be entitled to vote at the Annual Meeting. As of February 27, 1998,
the Company had outstanding 818,654 shares of its common stock, $5 par value
(Common Stock), each of which is entitled to one vote at the Annual Meeting. A
majority of votes entitled to be cast on matters considered at the Annual
Meeting constitutes a quorum. If a share is represented for any purpose at the
Annual Meeting, it is deemed to be present for purposes of establishing a
quorum. Abstentions and shares held of record by a broker or its nominees
(Broker Shares) which are voted on any matter are included in determining the
number of votes present or represented at the Annual Meeting. Conversely, Broker
Shares that are not voted on any matter will not be included in determining
whether a quorum is present. If a quorum is established, directors will be
elected by a plurality of the votes cast by shareholders at the Annual Meeting.
Votes that are withheld and Broker Shares that are not voted in the election of
directors will not be included in determining the number of votes cast.
1
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth the number and percentage of shares of
Common Stock beneficially owned, as of February 27, 1998 by each of the
Company's directors and nominees and all of the Company's directors and
executive officers as a group. For the purposes of this table, beneficial
ownership has been determined in accordance with the provisions of Rule 13d-3
under the Securities and Exchange Act of 1934, as amended, under which, in
general, a person is deemed to be a 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 60 days.
Amount Beneficially Percent of
Name of Owner Owned Class
- --------------------------------------------------------------------------------
Thomas L. Cline 2,317 1 .283%
Julian D. Fisher 29,479 2 3.601%
Robert L. Halterman 9,616 1.175%
Lawrence H. Hoover, Jr. 15,644 3 1.911%
Wayne L. Long 5,538 4 .676%
Richard S. Myers 3,890 5 .475%
Michael W. Pugh 200 .024%
Dan B. Todd 11,842 6 1.447%
Ronald E. Wampler 2,500 .305%
Directors and executive officers
as a group (9 persons) 81,026 9.897%
__________________________________
1 Includes 1,241 shares owned directly, 1,020 shares owned jointly with
another member of his household and 56 shares owned by another member of
his household.
2 Includes 3,143 shares owned directly, 2,730 shares owned by another
member of his household and 23,606 shares owned by the Company's stock
bonus plan over which Mr. Fisher has voting power.
3 Includes 10,280 shares owned directly, 46 shares owned by another
member of his household and 5,318 shares owned by a Unitrust in which he
is one of the trustees.
4 Includes 1,742 shares owned directly and 3,796 shares owned by another
member of his household.
5 Includes 1,600 shares owned directly and 2,290 shares held in Mr.
Myers' IRA Account.
6 Includes 1,280 shares owned directly, 8,554 shares owned by another
member of his household and 2,008 shares held in Mr. Todd's IRA Account.
SECURITY OWNERSHIP OF BENEFICIAL OWNERS
Management of the Company knows of no person who has beneficial
ownership of 5% or more of outstanding Common Stock as of February 27, 1998.
2
<PAGE>
PROPOSAL ONE ELECTION OF DIRECTORS
The term of office for the current Class B directors expires at the
Annual Meeting. The Board of Directors has nominated such directors, namely
Thomas L. Cline, Robert L. Halterman, Wayne L. Long and Michael W. Pugh for
reelection, for a three-year term, by the shareholders at the Annual Meeting.
The persons named as proxies in the accompanying form of proxy, unless
instructed otherwise, intend to vote for the election of each of these nominees
for directors. If any nominee should become unavailable to serve, the proxy may
be voted for the election of a substitute nominee designated by the Board. The
Board has no reason to believe that any of the nominees will be unable to serve
if elected.
The Board recommends election of the Class B
director nominees set forth in this Proxy Statement.
INFORMATION CONCERNING DIRECTORS AND NOMINEES
The following information, including the principal occupation during
the past five years, is given with respect to the nominees, all of whom are
current directors, for election to the Board at the Annual Meeting, as well as
all directors continuing in office.
- --------------------------------------------------------------------------------
Name, Age and Position Director Principal Occupation During
with the Company Since the Last Five Years
- --------------------------------------------------------------------------------
Director Nominees
-----------------
CLASS B DIRECTORS
(to serve until the 2001 annual meeting of shareholders)
Thomas L. Cline (51) 1991 President of Truck & Equipment Corp. &
Mac Lease, Inc. since May 1997, Sec.
of North and South Lines, Inc. since
May 1997, Secretary of Truck Thermo
King, Inc. and Transport Repairs, Inc.
since 1974
Robert L. Halterman (62) 1980 President of Virginia Classic Mustang,
Inc., an auto parts company, Partner,
H & H Properties
Wayne L. Long (68) 1985 Real estate and retired farmer
Michael W. Pugh (43) 1994 President of Old Dominion Realty,
Inc., Partner in Tri-City Development
Co., President of Colonial Appraisal
Service, Inc. and Treasurer of Old
Mill Enterprises, Inc.
Directors Continuing in Office
------------------------------
CLASS C DIRECTORS
(to serve until the 1999 annual meeting of shareholders)
Julian D. Fisher (57) 1990 CEO of Farmers & Merchants Bank (the
President & CEO Bank) since May 1996; President of the
Bank since Oct. 1991
Dan B. Todd (66) 1969 CEO of the Bank from 1969 to May 1996;
Chairman of the Board of the Bank
since Oct. 1991
3
<PAGE>
CLASS A DIRECTORS
(to serve until the 2000 annual meeting of shareholders)
Lawrence H. Hoover, Jr. (63) 1981 Attorney, Partner in Hoover, Penrod,
Vice Chairman of the Board Davenport & Crist and its predecessor
since 1971
Richard S. Myers (50) 1988 President of Dick Myers Chevrolet-GEO
since February 1991, Owner, TrAndy
Apartments, L.L.C. and TrAndy Real
Estate Holdings, L.L.C.
Ronald E. Wampler (50) 1991 Farmer & partner in Dove Farms, Inc.
and its affiliates
Board Meetings and Committees
The Board of the Company met 18 times during 1997. All incumbent
members of the Board attended at least 75% of the total number of meetings of
the Board. The Board of the Bank meets twice each month and primarily manages
all matters for the Bank. All the directors of the Company are also directors of
the Bank.
The Company has an Audit Committee which reviews the audit and
examination reports of the internal auditor, independent public accountants and
bank examiners as they relate to the Company and the Bank. The Audit Committee
held four meetings during 1997. The present committee members are Directors
Cline, Halterman, Long and Myers. For the year 1997, the Company did not have a
standing nominating or compensation committee.
Compensation of Directors
All directors of the Company who are also directors of the Bank each
received $150 for attending each board meeting of the Bank in 1997. They
received no additional compensation as directors for Board meetings of the
Company. In addition, each director received a bonus of $5,000 for the year
ended 1997 and $50 for each committee meeting attended.
SUMMARY COMPENSATION
The Summary Compensation Table below sets forth the compensation of the
Company's Chief Executive Officer for all services rendered to the Company and
the Bank for the last three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Name and Annual Compensation 1 Other
Principal Position Year Salary ($) Bonus ($) Compensation ($) 2
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Julian D. Fisher 1997 $100,000 $35,000 $31,082
Chief Executive Officer 1996 84,912 30,000 20,813
& President 1995 72,800 25,000 17,213
</TABLE>
1 The value of perquisites and other personal benefits did not exceed
the lessor of $50,000 or 10% of the total of annual salary and bonus.
2 The amounts presented include the Company's contribution for the
benefit of Mr. Fisher under the Company's Stock Bonus Plan ($14,486, $12,151,
and $9,280 in 1997, 1996, and 1995, respectively), the gross value of life
insurance premiums paid by the Company on behalf of Mr. Fisher ($14,796, $7,334,
and $7,386 in 1997, 1996, and 1995, respectively) and the lease value of
personal mileage on a company vehicle that has been provided for Mr. Fisher's
use ($1,800, $1,328, and $547 in 1997, 1996, and 1995, respectively). Pursuant
to a split-dollar insurance agreement between the Company and Mr. Fisher, the
Company will be repaid such premium payments from the proceeds of the insurance
policies. Thus, the gross premium payment amounts shown overstate the actual
economic benefit to Mr. Fisher.
4
<PAGE>
Severance Plan
In 1996, the Company and the Bank adopted a change in control severance
plan which became effective July 1, 1996. The plan covers employees designated
by the Company's Board of Directors, including Mr. Fisher.
Under the plan, a "covered termination" is a cessation of employment
with the Company or its then affiliates within 36 months after a change in
control (as defined in the plan) on account of either (i) termination of
employment by the covered employee for good reason (defined to mean the
occurrence after a change in control of any of the following: the assignment of
duties inconsistent with prior duties, the diminution of responsibilities, a
reduction in base salary, a transfer of job location of more than 50 miles, a
failure to pay compensation or deferred compensation within seven days after
due, a failure to continue participation and benefits under any compensation or
benefits plan (or any successor or replacement plan) at as favorable a level, or
a failure of the Company to require any successor to the Company to comply with
the plan) or (ii) termination initiated by the Company or any of its affiliates
for any reason other than death, disability, mandatory retirement or cause (as
defined in the plan).
In the event of such a covered termination, a covered employee will be
entitled to the following severance benefits: (i) continuation of the employee's
base pay (as defined in the plan) through the earlier of his or her death or the
third anniversary of the date of the change in control (the severance pay
period); (ii) continuation of the availability of coverage, and the employer's
regular contribution towards that coverage, under the employer's health care
plan during the severance pay period for the employee and his or her eligible
dependents; (iii) the right to buy any car that the employee is assigned by the
employer at its then fair market value; and (iv) a lump sum payment equal to the
value of any qualified or nonqualified retirement benefits forfeited by the
employee on account of his or her covered termination.
Indebtedness and Other Transactions
The Company's directors and officers and other corporations, business
organizations, and persons with whom some of the Company's directors and
officers are associated, had loan transactions at December 31, 1997 with the
Bank totaling approximately $1,217,533, or about 5.85% of average shareholders'
equity for the year. All such transactions were made in the ordinary course of
business on substantially the same terms, including interest rates and
collateral, as those prevailing at the time in comparable transactions with
others and did not involve more than the normal risk of collectibility or
present other unfavorable features.
PROPOSAL TWO APPOINTMENT OF INDEPENDENT
PUBLIC ACCOUNTANTS
S. B. Hoover & Company, L.L.P. of Harrisonburg, Virginia, was the
auditor for the Company for 1997 and is being recommended to the Company's
shareholders for appointment as auditor for 1998. A representative of S. B.
Hoover & Company, L.L.P. is expected to be present at the Annual Meeting, will
have the opportunity to make a statement if he desires to do so, and is expected
to be available to respond to appropriate questions from shareholders.
The Board recommends a vote for Proposal Two.
PROPOSAL THREE INCREASE IN AUTHORIZED STOCK
On August 21, 1997, the Board voted unanimously to recommend to its
shareholders an amendment of the Company's Articles of Incorporation to increase
the number of the authorized shares of Common Stock from 2,000,000 to 3,000,000
shares. Adoption of this amendment requires the approval of more than two-thirds
of all votes entitled to be cast at the Annual Meeting.
The text of the proposed amendment is as follows:
5
<PAGE>
The Articles of Incorporation of F & M Bank Corp. are amended by
replacing paragraph 3 with the following:
"3. The Corporation shall have the authority to issue 3,000,000 shares
of the par value of $5.00 each."
The Board considers the proposed increase in the number of authorized
shares desirable because it would give the Board the necessary flexibility to
issue Common Stock in connection with stock dividends and splits, possible
future acquisitions, and the Company's Stock Bonus Plan and for other general
corporate purposes without the expense and delay incidental to obtaining
shareholder approval of an amendment to the Articles of Incorporation increasing
the number of authorized shares at the time of such action, except as may be
required for a particular issuance by applicable law or by the rules of any
stock exchange on which the Company's securities may then be listed. The
shareholders of the Company do not have any preemptive rights with respect to
the issuance of any additional shares of Common Stock, and the shares of Common
Stock authorized pursuant to this proposal would likewise contain no preemptive
rights. The Company has no current plans, understandings or agreements regarding
stock dividends and splits, acquisitions, and the Company's Stock Bonus Plan
that would cause the Company to issue any of the additional shares of Common
Stock authorized by this proposal.
The authorization of additional shares of Common Stock pursuant to this
proposal will have no dilutive effect upon the proportionate voting power of
existing shareholders of the Company. However, to the extent that shares are
subsequently issued to persons other than existing shareholders and/or in
proportions other than the proportion that currently exists, such issuance could
have a substantial dilutive effect on existing shareholders.
The Board believes, however, that the proposed amendment to the
Articles of Incorporation will provide several long-term benefits to the Company
and its shareholders, including the flexibility to pursue acquisitions in
exchange for Common Stock of the Company. While the Company has no specific
plans, proposals, understandings or agreements for any such acquisition, the
issuance of additional shares of Common Stock for an acquisition may have a
dilutive effect on earnings per share and book value per share, as well as a
dilutive effect on the voting power of existing shareholders. The Company would
expect that any such dilutive effect on earnings per share and/or book value per
share would be relatively short-term in duration.
The issuance of additional shares of Common Stock by the Company also
may potentially have an anti-takeover effect by making it more difficult to
obtain shareholder approval of various actions, such as a merger. The proposed
increase in the number of authorized shares of Common Stock could enable the
Board to render more difficult an attempt by another person or entity to obtain
control of the Company, though the Board has no present intention of issuing
additional shares for such purposes and has no present knowledge of any such
takeover efforts.
The Board recommends a vote for Proposal Three.
SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the Company's
1999 Annual Meeting must be received by the Secretary of the Company, at its
principal executive offices, P. O. Box 1111, Timberville, Virginia 22853 for
inclusion in its proxy statement relating to that meeting by November 18, 1998.
By Order of the Board of Directors
Larry A. Caplinger, Secretary
March 13, 1998
6
<PAGE>
PROXY
F & M BANK CORP.
Annual Meeting of Shareholders, April 11, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Lawrence H. Hoover, Jr., Richard S.
Myers and Ronald E. Wampler, any or all of whom may act, with full power of
substitution, as proxies to vote, as designated below, at the Annual Meeting of
Shareholders to be held April 11, 1998 at 5:30 P.M. and at any adjournment
thereof, the shares of F & M Bank Corp. common stock held of record by the
undersigned as of February 27, 1998.
The shares to which this proxy relates will be voted as specified. If
no specification is made, such shares will be voted in favor of the proposals
set forth on this proxy.
PROPOSAL ONE
ELECTION OF DIRECTORS
<TABLE>
<CAPTION>
<S> <C>
_ _
|_| FOR all nominees listed below |_| WITHHOLD AUTHORITY to vote for all
(except as marked to the contrary below) nominees listed below
</TABLE>
Thomas L. Cline, Robert L. Halterman, Wayne L. Long and Michael W. Pugh
for three-year terms to expire in 2001.
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name in the space below.)
================================================================================
PROPOSAL TWO
APPOINTMENT OF S. B. HOOVER & COMPANY, L.L.P.
AS INDEPENDENT PUBLIC ACCOUNTANTS
_ _ _
|_| FOR |_| AGAINST |_| ABSTAIN
PROPOSAL THREE
INCREASE IN AUTHORIZED SHARES OF COMMON STOCK
_ _ _
|_| FOR |_| AGAINST |_| ABSTAIN
IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER BUSINESS
AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING.
Please complete, date and sign the proxy and return it as soon as
possible in the enclosed postage prepaid envelope. The proxy must be signed
exactly as the name or names appear on the label attached to this proxy with the
exception of any stock listed in the name of the owner TOD to another
individual. If signing as a trustee, executor, etc., please so indicate.
Date Signed: ___________________________
________________________________________
________________________________________
Signature(s)
