<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 2, 1998
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
FIRST NATIONAL CORPORATION
(Exact name of registrant as specified in its charter)
SOUTH CAROLINA 57-0799315
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
950 JOHN C. CALHOUN DRIVE, S.E.
ORANGEBURG, SOUTH CAROLINA 29115
TEL: (803) 531-0527
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
----------------
W. LOUIS GRIFFITH
CHIEF FINANCIAL OFFICER
FIRST NATIONAL CORPORATION
950 JOHN C. CALHOUN DRIVE, S.E.
ORANGEBURG, SOUTH CAROLINA 29115
TEL: (803) 531-0527
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
----------------
COPIES TO:
ROBIN L. HINSON, ESQ.
DAVID W. DABBS, ESQ.
ROBINSON, BRADSHAW & HINSON, P.A.
1900 INDEPENDENCE CENTER
CHARLOTTE, NORTH CAROLINA 28246
TEL: (704) 377-2536
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: [ ]
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=====================================================================================================================
Proposed Proposed
Maximum Maximum
Title of Each Class of Amount to be Offering Price Per Aggregate Amount of
Securities to be Registered Registered Share(1) Offering Price(1) Registration Fee
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $2.50 par value.......... 105,000 shares $23.875 $2,506,875 $740
=====================================================================================================================
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(c) based upon the average of the high ($24.125) and
low ($23.625) sale prices of the Common Stock as reported on the American
Stock Exchange on January 26, 1998.
------------------------
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE> 2
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This Prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
SUBJECT TO COMPLETION, DATED FEBRUARY 2, 1998
PROSPECTUS
FIRST NATIONAL CORPORATION
105,000 SHARES
COMMON STOCK ($2.50 PAR VALUE)
First National Corporation, a South Carolina corporation (the "Company"
or "FNC"), hereby offers 105,000 shares of its common stock, par value $2.50 per
share ("Common Stock"), to be sold by the Company from time to time at market
prices prevailing at the time subscription offers are received from prospective
investors. See "The Offering." The outstanding shares of Common Stock of the
Company are, and the additional shares of Common Stock offered hereby will be,
listed on the American Stock Exchange under the symbol "FNC." The reported last
sale price of the Common Stock on January 28, 1998 was $25.00 per share.
This offering will terminate on the earlier of (1) receipt and
acceptance by the Company of subscriptions for an aggregate of 105,000 shares;
(2) a decision by FNC to terminate this offering; or (3) 5:00 p.m., Florence,
South Carolina time, on September 30, 1998 (subject to the right of the Company,
in its sole discretion, to extend this offering until 5:00 p.m., Florence, South
Carolina time, on December 31, 1998) (the "Expiration Date"). While FNC intends
to use its best efforts to sell 105,000 shares, the offering may be terminated
without notice before all such shares are sold. No minimum number of shares or
amount of proceeds is required to be raised pursuant to this offering. See "The
Offering."
SEE "RISK FACTORS" BEGINNING ON PAGE 6 FOR A DISCUSSION OF CERTAIN FACTORS THAT
SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.
THE SECURITIES OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OTHER
OBLIGATIONS OF A BANK OR SAVINGS ASSOCIATION AND ARE NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
================================================================================
Price Underwriting
to Discounts and Proceeds to
Public(1) Commissions(2) the Company(3)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share................ $ 25.00 $0.00 $ 25.00
Total.................... $2,625,000 $0.00 $2,625,000
================================================================================
</TABLE>
(1) Estimated based on the reported last sale price of Common Stock on
January 28, 1998.
(2) These securities will be offered by certain officers and directors of
the Company and certain proposed officers and directors of the Proposed
Bank (as defined herein). No commissions or other compensation will be
paid to any person in connection with the sale of shares of Common
Stock offered hereby. See "The Offering."
(3) Before deduction of expenses associated with this offering estimated at
$60,000.
The date of this Prospectus is ___________, 1998.
<PAGE> 3
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the Commission's regional offices at
7 World Trade Center, 13th Floor, New York, New York 10048, and Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of
these materials can also be obtained from the Commission at prescribed rates by
writing to the Public Reference Section of the Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549. In addition, the Commission maintains a World Wide
Web site on the Internet at http://www.sec.gov that contains reports, proxy and
information statements and other documents filed electronically with the
Commission, including the registration statement on Form S-3 (the "Registration
Statement") filed by the Company with the Commission with respect to the shares
of Common Stock offered hereby. The Common Stock of the Company is listed on the
American Stock Exchange, and such reports, proxy statements and other
information may be inspected at the office of the American Stock Exchange, 86
Trinity Place, New York, New York 10006. This Prospectus does not contain all of
the information set forth in the Registration Statement (and exhibits thereto)
which the Company has filed with the Commission under the Securities Act of
1933, as amended (the "Securities Act"), and to which reference is hereby made.
The Registration Statement (and exhibits thereto) may be inspected at the office
of the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549,
and copies thereof may be obtained from the Commission at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents hereby are incorporated by reference into this
Prospectus: (i) the Company's Annual Report on Form 10-K for the year ended
December 31, 1996; (ii) the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1997; (iii) the Company's Current Report on Form 8-K,
dated May 22, 1997; (iv) the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1997; (v) the Company's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1997; and (vi) the description of the Company's
Common Stock contained in the Company's Registration Statement on Form 8-A, as
amended, initially filed with the Commission on January 21, 1997 (File No.
001-12669). All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of this offering shall be deemed to be incorporated by
reference into this Prospectus from the date of filing of such document. Any
statement contained herein or in a document, all or a portion of which is
incorporated or deemed to be incorporated by reference herein, shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus. The Company will provide without charge to each person to whom this
Prospectus is delivered, upon the request of such person, a copy of any or all
of the foregoing documents incorporated herein by reference, other than exhibits
to such documents (unless such exhibits are incorporated by reference in such
documents). Requests should be directed to the attention of W. Louis Griffith,
Chief Financial Officer, First National Corporation, 950 John C. Calhoun Drive,
S.E., Orangeburg, S.C. 29115, (803) 531-0527.
2
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Available Information..........................................................2
Incorporation of Certain Documents by Reference................................2
Summary........................................................................4
Risk Factors...................................................................6
Use of Proceeds................................................................8
Capitalization.................................................................9
Price of Common Stock and Dividends...........................................10
Selected Financial Data.......................................................11
The Offering..................................................................12
The Company...................................................................14
The Proposed Bank.............................................................15
Experts.......................................................................18
Legal Matters.................................................................18
</TABLE>
APPENDIX A - Subscription Agreement
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE HEREIN
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS DOCUMENT DOES NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER
OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS
DOCUMENT NOR ANY DISTRIBUTION OF SECURITIES MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF.
3
<PAGE> 5
SUMMARY
The following summary is qualified in its entirety and should be read
in conjunction with the more detailed information and financial statements
appearing elsewhere in this Prospectus and by the information and financial
statements incorporated by reference herein.
THE COMPANY
The Company is a bank holding company that owns all the outstanding
capital stock of First National Bank, a national bank headquartered in
Orangeburg, South Carolina ("FNB"), and National Bank of York County, a national
bank headquartered in Rock Hill, South Carolina ("NBYC"). The Company is in the
process of sponsoring the organization of Florence County National Bank (In
Organization), a national bank being organized in Florence, South Carolina (the
"Proposed Bank"). Upon receipt of necessary regulatory approvals, FNC intends to
acquire for approximately $4.5 million all the outstanding capital stock of the
Proposed Bank using up to $2.5 million borrowed by FNC pursuant to a line of
credit with an unrelated financial institution (the "Line of Credit"). The net
proceeds from this offering will be used to fund the expenses of organizing the
Proposed Bank, to repay (to the extent possible) amounts outstanding under the
Line of Credit and to replenish general corporate funds used to acquire the
capital stock of the Proposed Bank. The primary purpose of this offering is to
provide residents of Florence County, South Carolina, with the opportunity to
invest in the Company to enhance the base of support for the Proposed Bank in
the Florence County area. However, this offering will not be limited to
residents of Florence County.
The Proposed Bank is a proposed national bank being organized in
Florence, South Carolina. The Company has received preliminary charter approval
from the Office of the Comptroller of the Currency (the "OCC"), and the Company
has filed an application for the issuance by the Federal Deposit Insurance
Corporation (the "FDIC") of deposit insurance. The Proposed Bank will operate as
a wholly-owned subsidiary of FNC with its own Board of Directors and operating
policies. The organizers (the "Organizers") of the Proposed Bank are Starlee B.
Alexander, Dr. James W. Burch, William W. Coleman, Jr., Dr. Willie S. Edwards,
Jr., James C. Gregg, Jr., Dr. Francis Gregg Jones, Samuel A. Rodgers and Daniel
P. Thompson, Sr. William W. Coleman, Jr. has agreed to serve as the President
and Chief Executive Officer of the Proposed Bank.
THE OFFERING
<TABLE>
<CAPTION>
<S> <C>
Shares of Common Stock offered(1)........... 105,000 shares
Offering price per share.................... Closing sale price of the
Common Stock on any of the
five business days
preceding the day on which
an investor mails or hand
delivers his Subscription
Agreement to the Company,
as the case may be.
Minimum individual purchase(2).............. 100 shares
Maximum individual purchase(2).............. 7,500 shares
Use of proceeds............................. To fund the expenses of
organizing the Proposed
Bank, to repay (to the
extent possible) amounts
outstanding under the Line
of Credit and to replenish
general corporate funds
used to acquire the
capital stock of the
Proposed Bank.
</TABLE>
- -------------------
(1) The Company has reserved approximately 24,000 shares of Common Stock
offered hereby for sale to directors, officers, employees and certain
individuals associated with the Company and the Proposed Bank,
including the Organizers.
(2) The Company reserves the right, in its sole discretion, to alter the
individual minimum and maximum purchase amounts. See "The Offering."
4
<PAGE> 6
Upon receipt and acceptance by the Company of an offer to subscribe for
shares of Common Stock offered hereby, the Company will issue a stock
certificate to the subscriber for the number of shares as to which the
subscription has been accepted. No interest will be paid to subscribers with
respect to any subscription proceeds. See "The Offering."
This offering will terminate on the earlier of (1) receipt and
acceptance by the Company of subscriptions for an aggregate of 105,000 shares;
(2) a decision by the Company to terminate this offering; or (3) 5:00 p.m.,
Florence, South Carolina time, on September 30, 1998 (subject to the right of
the Company, in its sole discretion, to extend this offering until 5:00 p.m.,
Florence, South Carolina time, on December 31, 1998) (the "Expiration Date").
SUMMARY FINANCIAL DATA
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, Years Ended December 31,
------------- ------------------------
STATEMENT OF INCOME DATA: 1997 1996 1996 1995 1994
---- ---- ---- ---- ----
(unaudited)
<S> <C> <C> <C> <C> <C>
Total interest income........... $30,426 $25,136 $34,263 $30,183 $25,146
Total interest expense.......... 12,843 10,260 13,986 12,525 9,093
Provision for loan losses....... 873 789 1,319 844 575
Total noninterest income........ 4,586 3,867 5,344 4,049 3,533
Total noninterest expense....... 14,112 11,947 16,352 14,321 13,342
Income before income taxes...... 7,184 6,007 7,950 6,542 5,669
Net income...................... 4,953 4,182 5,528 4,640 4,061
Net income per common
share(1).................... 0.96 0.86 1.14 .98 .86
Cash dividends per common
share(1).................... 0.29 0.275 .37 .34 .32
</TABLE>
<TABLE>
<CAPTION>
September 30, December 31,
------------- ------------
1997 1996
---- ----
BALANCE SHEET DATA: (unaudited)
<S> <C> <C>
Total investment securities.... $173,412 $160,881
Loans, net of unearned income
and 336,556 288,914
allowance for loan losses..
Total assets................... 559,733 497,632
Total deposits................. 452,808 414,153
Total liabilities.............. 506,836 449,286
Shareholders' equity........... 52,897 48,346
</TABLE>
- -------------------
(1) Per share data have been retroactively adjusted to give effect to a ten
percent common stock dividend paid to shareholders of record on October
28, 1994, a ten percent common stock dividend paid to shareholders of
record on October 31, 1995 and a two-for-one stock split paid to
shareholders of record on May 30, 1997.
A summary of the results of operations of the Company during the
quarter ended December 31, 1997 is set forth under the caption "The Company --
Recent Developments."
5
<PAGE> 7
RISK FACTORS
IN ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS AND IN THE
DOCUMENTS INCORPORATED BY REFERENCE HEREIN, THE FOLLOWING RISK FACTORS SHOULD BE
CAREFULLY CONSIDERED IN EVALUATING THE COMPANY AND ITS BUSINESS BEFORE
PURCHASING THE COMMON STOCK OFFERED HEREBY. CERTAIN STATEMENTS MADE IN THIS
PROSPECTUS, INCLUDING THE STATEMENTS UNDER THE CAPTION "THE PROPOSED BANK," MAY
BE FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE
SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT. ACTUAL RESULTS COULD DIFFER
MATERIALLY FROM THOSE PROJECTED IN THE FORWARD-LOOKING STATEMENTS AS A RESULT OF
THE RISK FACTORS, SPECIFICALLY THE RISK FACTOR "-- RISK INHERENT IN
ESTABLISHMENT OF A NEW BUSINESS," SET FORTH BELOW AND ELSEWHERE IN THIS
PROSPECTUS.
DELAY IN DELIVERY OF COMMON STOCK
There may be a delay between the time an investor submits his or her
subscription offer to the Company and the time the Company issues certificates
evidencing shares of Common Stock subscribed for. Prior to the time shares are
issued by the Company, an investor may be unable to cancel, terminate or revoke
his or her Subscription Agreement or to sell shares of Common Stock acquired
pursuant to such Subscription Agreement. See "The Offering."
NO INTEREST ON SUBSCRIPTION PROCEEDS; NO DIVIDENDS PAID ON SUBSCRIBED SHARES
PRIOR TO ISSUANCE
All interest earned on subscription proceeds will be retained by the
Company. Although all subscription proceeds will be returned if an offer to
subscribe is not accepted by the Company, no interest will be paid to
subscribers on such returned subscription proceeds. Further, a subscriber will
not be entitled to payment of dividends, if any, declared on the Common Stock
with respect to any subscribed shares until after the stock certificate
evidencing such shares has been issued. After issuance of subscribed shares, a
subscriber will be entitled to receive dividends, when, as and if declared,
beginning with the first dividend payment having a record date after the date on
which such person became a record holder of the Common Stock.
RISK INHERENT IN ESTABLISHMENT OF A NEW BUSINESS
The Proposed Bank currently is in the organizational stage and has no
operating history. Accordingly, prospective investors have limited information
relating to the prospects for success of the Proposed Bank or the effect the
Proposed Bank will have on the operations of the Company. As a bank holding
company, the Company's profitability depends entirely upon the operations of its
subsidiary banks. The operations of the Proposed Bank will be subject to the
risks inherent in the establishment of a new business and, specifically, of a
new bank. Typically, new banks incur substantial initial expenses and are not
profitable for several years after commencing business. Furthermore, there can
be no assurance that the Proposed Bank will ever operate profitably.
ABSENCE OF ACTIVE TRADING MARKET
The Common Stock offered hereby will be freely tradeable by
shareholders who are not "affiliates" of the Company (as that term is defined in
Rule 144 under the Securities Act) immediately upon issuance. However, although
the Common Stock is authorized for trading on the American Stock Exchange, there
historically has not been an active market for the Common Stock, and there can
be no assurance that an active market for Common Stock will develop.
Accordingly, persons who desire to sell shares of Common Stock may encounter
difficulty selling such shares on short notice and at prevailing market prices.
Further, the purchase or sale of large blocks of Common Stock or material
developments affecting the Company could cause the market price of the Common
Stock to fluctuate significantly.
6
<PAGE> 8
DELAY IN OBTAINING REGULATORY APPROVALS
The Company must obtain the prior approval of the OCC, the FDIC, the
Board of Governors of the Federal Reserve System (the "FRB") and the South
Carolina State Board of Financial Institutions (the "State Board") in connection
with the organization of the Proposed Bank and the acquisition by the Company of
the outstanding capital stock of the Proposed Bank. Although the Proposed Bank
plans to open for business during the second quarter of 1998, no assurance can
be given that all requisite governmental approvals will be received by such time
or at all. Any significant delay in commencing business will increase the amount
of organizational expenses and may reduce the Proposed Bank's and the Company's
capital, potential revenues and income.
7
<PAGE> 9
USE OF PROCEEDS
BY THE COMPANY
No minimum number of shares of Common Stock offered hereby is required
to be sold in this offering, and no minimum amount of proceeds is required to be
raised pursuant to this offering. If all 105,000 shares are sold at the last
reported sale price of $25.00 on January 28, 1998, the net proceeds to the
Company from this offering would be approximately $2,565,000, after deducting
estimated offering expenses of $60,000. The Company intends to use up to
$180,000 of the net proceeds to fund the estimated expenses of organizing the
Proposed Bank. The Company intends to use up to $2.5 million to repay amounts
outstanding under the Line of Credit, which will be incurred by the Company in
connection with the acquisition of the outstanding capital stock of the Proposed
Bank. The Line of Credit bears interest at the lender's prime rate minus 100
basis points, and matures on January 6, 1999. The balance of the net proceeds of
this offering, if any, will be used by the Company to replenish general
corporate funds used to acquire the outstanding capital stock of the Proposed
Bank and for general corporate purposes.
BY THE PROPOSED BANK
Of the $4.5 million received by the Proposed Bank from the sale of its
capital stock to the Company, approximately $350,000 is expected to be used to
purchase from FNC (at FNC's cost) land on which the Proposed Bank will be
located, approximately $650,000 is expected to be used to build the Proposed
Bank's offices, and approximately $300,000 is expected to be used for equipment
and furnishings. The balance of the proceeds from the sale of the stock of the
Proposed Bank to the Company will be used by the Proposed Bank for general
corporate purposes.
8
<PAGE> 10
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
September 30, 1997 on an actual and as adjusted basis. The as adjusted
capitalization gives effect to the sale of all 105,000 shares of Common Stock
offered hereby at the last reported sale price on January 28, 1998 of $25.00 per
share and the application of the estimated net proceeds therefrom. See "Use of
Proceeds." If less than 105,000 shares of Common Stock is sold or if such shares
are sold at an average price that is less than the last reported sale price on
January 28, 1998, the as adjusted total shareholders' equity would be less than
the amount set forth below.
<TABLE>
<CAPTION>
September 30, 1997
--------------------------------------
Actual As Adjusted
------ -----------
(in thousands)
<S> <C> <C>
Long term debt........................................... $ 0 $ 0
Shareholders' equity:
Common stock, par value $2.50 per
share; 40,000,000 shares authorized;
5,188,097 shares issued and outstanding,
actual; 5,293,097 shares issued and
outstanding, as adjusted............................. 12,970 13,233
Additional paid-in capital............................ 23,257 25,559
Retained earnings..................................... 16,255 16,255
Unrealized gain (loss) on securities available-for-
sale, net............................................ 415 415
------- -------
Total shareholders' equity.................... 52,897 55,462
Total capitalization.......................... $52,897 $55,462
======= =======
</TABLE>
9
<PAGE> 11
PRICE RANGE OF COMMON STOCK AND DIVIDENDS
The Company's Common Stock is listed on the American Stock Exchange
under the trading symbol "FNC." The following table sets forth the high and low
sale prices and the quarterly dividends declared on the Common Stock for the
periods shown. Per share information set forth below has been adjusted to give
retroactive effect to stock dividends and stock splits effected during the
periods shown.
<TABLE>
<CAPTION>
Price Per Share Dividends
--------------- Declared Per
High Low Share
---- --- ------------
<S> <C> <C> <C>
1996:
First Quarter.................................. * * $.090
Second Quarter................................. * * .090
Third Quarter.................................. * * .095
Fourth Quarter................................. * * .095
1997:
First Quarter.................................. * * .095
Second Quarter................................. $27.94 $21.44 .095
Third Quarter.................................. 27.06 25.00 .100
Fourth Quarter................................. 26.75 22.00 .110
1998:
First Quarter (through January 29, 1998).... $25.38 $22.75 .110
</TABLE>
- ------------------------
* On January 28, 1997, the Common Stock was listed for trading on the
American Stock Exchange. Trading on the American Stock Exchange opened at
$16.00 per share, and trading prices ranged from $16.00 per share to
$21.63 per share from January 28, 1997 to March 31, 1997. The Company
believes that, after giving retroactive effect to stock dividends and
stock splits, the Common Stock traded at prices ranging from $11.00 to
$14.00 per share during the period from January 1, 1996 to January 27,
1997. However, management has knowledge of only a limited number of trades
during such period and has no independent means of verifying the price at
which any such trades occurred.
Dividends are paid by the Company from its assets which are provided
primarily by dividends paid to the Company by FNB. Certain restrictions exist
regarding the ability of the Company's subsidiaries to transfer funds to the
Company in the form of cash dividends, loans or advances. The approval of the
OCC is required to pay dividends in excess of FNB's and NBYC's respective net
profits for the current year plus retained net profits (net profits less
dividends paid) for the preceding two years, less any required transfers to
surplus. As of September 30, 1997, $7,912,000 of FNB's retained earnings and
none of NBYC's retained earnings were available for distribution to FNC as
dividends without prior regulatory approval. For the nine months ended September
30, 1997, FNB paid dividends to the Company of approximately $1,483,703.
10
<PAGE> 12
SELECTED FINANCIAL DATA
(Dollars in thousands, except per share data)
The selected consolidated financial data of the Company for and as of
each of the years in the three-year period ended December 31, 1996 are derived
from the Company's consolidated financial statements, which have been audited by
J.W. Hunt and Company, LLP, independent certified public accountants. The
selected consolidated financial data for and as of the nine-months ended
September 30, 1997 and September 30, 1996 are derived from the unaudited
consolidated financial statements of the Company. Such unaudited financial
statement include all adjustments, consisting of normal recurring accruals,
which the Company considers necessary for a fair presentation of the financial
position and results of operations for such periods. Operating results for the
nine months ended September 30, 1997 are not necessarily indicative of the
results to be expected for the full year. The selected consolidated financial
data should be read in conjunction with the Company's consolidated financial
statements and the notes thereto. See "The Company --Recent Developments."
<TABLE>
<CAPTION>
Nine Months Ended
September 30, Years Ended December 31,
------------- ------------------------
STATEMENT OF INCOME DATA: 1997 1996 1996 1995 1994
---- ---- ---- ---- ----
(unaudited)
<S> <C> <C> <C> <C> <C>
Total interest income........... $30,426 $25,136 $34,263 $30,183 $25,146
Total interest expense.......... 12,843 10,260 13,986 12,525 9,093
Provision for loan losses....... 873 789 1,319 844 575
Total noninterest income........ 4,586 3,867 5,344 4,049 3,533
Total noninterest expense....... 14,112 11,947 16,352 14,321 13,342
Income before income taxes...... 7,184 6,007 7,950 6,542 5,669
Net income...................... 4,953 4,182 5,528 4,640 4,061
Net income per common
share(1)..................... 0.96 0.86 1.14 .98 .86
Cash dividends per
common share(1).............. 0.29 0.275 .37 .34 .32
</TABLE>
<TABLE>
<CAPTION>
September 30, December 31,
------------- ------------
1997 1996 1995 1994
---- ---- ---- ----
BALANCE SHEET DATA: (unaudited)
<S> <C> <C> <C> <C>
Total investment securities................ $173,412 $160,881 $151,496 $133,356
Loans, net of unearned income
and allowance for loan losses......... 336,556 288,914 244,180 205,358
Total assets............................... 559,733 497,632 436,322 374,043
Total deposits............................. 452,808 414,153 368,315 320,707
Total liabilities.......................... 506,836 449,286 396,545 337,862
Shareholders' equity...................... 52,897 48,346 39,777 36,181
</TABLE>
- ---------------------
(1) Per share data have been retroactively adjusted to give effect to a ten
percent common stock dividend paid to shareholders of record on October
28, 1994, a ten percent common stock dividend paid to shareholders of
record on October 31, 1995 and a two-for-one stock split paid to
shareholders of record on May 30, 1997.
11
<PAGE> 13
THE OFFERING
GENERAL
The Company hereby is offering 105,000 shares of Common Stock to be
sold by the Company from time to time at market prices prevailing at the time
subscription offers for such shares are received from prospective investors. See
"-- Subscription Price." The minimum number of shares that may be purchased
pursuant to this offering is 100 shares, and the maximum number is 7,500 shares.
However, the Company reserves the right, in its sole discretion, to change the
individual minimum and maximum purchase amounts. The form of Subscription
Agreement to be used to subscribe for shares of Common Stock offered hereby is
attached hereto as Appendix A.
SUBSCRIPTION PRICE
Prospective investors may subscribe for shares of Common Stock offered
hereby at a subscription price equal to the closing sale price of the Common
Stock, as reported by the American Stock Exchange, on any of the five business
days immediately preceding the day on which an investor mails or hand delivers
his Subscription Agreement to the Company, as the case may be. For such
purposes, a Subscription Agreement will be deemed to have been mailed as of the
day on which the envelope containing such agreement is postmarked, and a
Subscription Agreement will be deemed to have been hand delivered to the Company
as of the day on which an authorized employee of the Company receives such
agreement at any of the Company's addresses set forth on the form of
Subscription Agreement attached hereto as Appendix A. THE COMPANY MAY REJECT ANY
SUBSCRIPTION OFFER FOR ANY REASON.
METHOD OF SUBSCRIPTION
Shares may be subscribed for by completing, executing and delivering,
on or prior to the Expiration Date, the Subscription Agreement, together with
full payment of the subscription price. The Subscription Agreement should be
delivered to First National Corporation, Attention: W. Louis Griffith, at 1600
W. Palmetto Street, Florence, South Carolina 29501; at 950 John C. Calhoun
Drive, S.E., Orangeburg, South Carolina 29115; or at Post Office Box 1287,
Orangeburg, South Carolina 29116-1287. All subscription payments must be made in
United States dollars by check, bank draft or money order drawn to the order of
"First National Corporation."
The Company reserves the right to reject any subscription offer in
whole or in part or to cancel acceptance of any subscription offer in whole or
in part until the date the shares purchased pursuant to such subscription offer
are issued. If all or part of a subscription is not accepted or is canceled by
the Company, all funds relating to the unaccepted or canceled portion will be
returned to the subscriber without interest thereon. Only C. John Hipp, III,
President and Chief Executive Officer of the Company, and W. Louis Griffith,
Chief Financial Officer of the Company, have the authority to accept or reject a
subscription, or portion thereof, on behalf of the Company.
PLAN OF DISTRIBUTION
This offering is being made to the public through certain officers and
directors of the Company and certain proposed officers and directors of the
Proposed Bank. No commission or other compensation will be paid to any person in
connection with the sale of shares of Common Stock offered hereby.
EXPIRATION DATE OF THE OFFERING
This offering will terminate on the earlier of (1) receipt and
acceptance by the Company of subscriptions for an aggregate of 105,000 shares;
(2) a decision by FNC to terminate this offering; or (3) 5:00 p.m., Florence,
South Carolina time, on September 30, 1998 (subject to the right of the
12
<PAGE> 14
Company, in its sole discretion, to extend this offering until 5:00 p.m.,
Florence, South Carolina time, on December 31, 1998) (the "Expiration Date").
While the Company intends to use its best efforts to sell all 105,000 shares,
this offering may be terminated by the Company at any time without notice before
any or all such shares are sold.
ISSUANCE OF COMMON STOCK
Upon receipt and acceptance by the Company of an offer to subscribe for
shares of Common Stock offered hereby, the Company will issue stock certificates
to the subscriber for the number of shares as to which the subscription has been
accepted.
13
<PAGE> 15
THE COMPANY
The Company is a bank holding company incorporated under the laws of
South Carolina in 1985. The Company owns FNB, a national bank chartered in 1934,
and NBYC, a national bank that opened for business in 1996. FNB conducts its
business from 20 offices in 13 towns in South Carolina, and NBYC operates in two
locations in two South Carolina towns. FNB and NBYC serve their respective
markets as independent, locally managed commercial banks emphasizing high
quality, responsive and personalized service and offering a broad range of
retail, consumer and commercial banking services.
On October 23, 1997, the Organizers of the Proposed Bank submitted
applications to the OCC and the FDIC for a national bank charter and the
issuance of deposit insurance. Preliminary approval of the charter application
was granted by the OCC on December 4, 1997. The Company currently is in the
process of applying to state and federal regulatory authorities for approval to
acquire all the outstanding capital stock of the Proposed Bank. If and when FNC
and the Proposed Bank obtain all necessary state and federal approvals, the
Company will acquire all the outstanding capital stock of the Proposed Bank for
approximately $4.5 million using up to $2.5 million borrowed under the Line of
Credit. The net proceeds of this offering will be used to fund the
organizational expenses of forming the Proposed Bank to repay, to the extent
possible, amounts outstanding under the Line of Credit and to replenish general
corporate funds used to acquire the outstanding capital stock of the Proposed
Bank. See "Use of Proceeds."
The principal offices of the Company are located at 950 John C. Calhoun
Drive, S.E., Orangeburg, South Carolina 29115, and its telephone number is (803)
534-2175. The principal offices of the Proposed Bank will be located at 1600 W.
Palmetto Street, Florence, South Carolina 29501.
RECENT DEVELOPMENTS
Net income for the fourth quarter of 1997 was $1,514,000 compared to
$1,346,000 for the fourth quarter of 1996, an increase of 12.5%. Net income for
the year ended December 31, 1997 was $6,466,000 compared to $5,528,000 for the
year ended December 31, 1996, an increase of 17%. The annualized return on
average assets and return on shareholders' equity for the fourth quarter of 1997
were 1.08% and 11.36%, respectively, as compared to 1.12% and 11.28%,
respectively, for the fourth quarter of 1996. For the year ended December 31,
1997, the annualized return on average assets and return on shareholders' equity
were 1.19% and 12.68%, respectively, compared to 1.19% and 12.85%, respectively,
for the year ended December 31, 1996. Total assets of the Company at December
31, 1997 were $565,571,000 compared to $497,632,000 at December 31, 1996, an
increase of 13.7%. Net loans increased 21.1% from $293,619,000 at December 31,
1996 to $355,513,000 at December 31, 1997, while total deposits increased 9.7%
from $414,153,000 at December 31, 1996 to $454,375,000 at December 31, 1997.
Shareholders' equity increased 11.5% from $48,347,000 at December 31, 1996 to
$53,900,000 at December 31, 1997, while book value per share of Common Stock
increased from $9.48 at December 31, 1996 to $10.39 at December 31, 1997.
14
<PAGE> 16
THE PROPOSED BANK
BACKGROUND
A substantial number of large financial institutions headquartered in
South Carolina have been acquired by national and regional bank holding
companies in recent years. As a result, the Company believes that South Carolina
and its citizens have lost much of the ability to control financial resources
and decisions relating to the allocation of those resources. The Company
believes that underwriting decisions are being made with greater frequency
outside South Carolina by entities and people not familiar with the borrowers or
the communities served. The Company believes that in many instances, banking
customers have become frustrated with the delays attendant to such external
decision making and with the lower levels of personal services occasioned by
consolidation and reductions in personnel.
In view of bank consolidations, the Company perceives an opportunity
for community banks offering local decision making, highly personalized service
and a commitment to the well-being and advancement of the communities served.
The Company believes that FNB and NBYC have successfully competed with their
larger national and regional competitors. Although these competitors have
greater financial and managerial resources than FNB and NBYC, the Company
believes that FNB and NBYC have compensated for these factors by offering a high
level of personal service and by responding quickly and efficiently to customer
needs.
ORGANIZERS OF THE PROPOSED BANK
Set forth below is brief biographical information about the Florence
businessmen who are the Organizers of the Proposed Bank.
STARLEE B. ALEXANDER (40). Ms. Alexander has been employed as an agent
with State Farm Insurance Company since 1985. Ms. Alexander received a
bachelor's degree from Florida A&M University and a master's degree in human
services from Nova University.
DR. JAMES W. BURCH (60). Dr. Burch has been self-employed as a dentist
in Lake City, South Carolina since 1964. Dr. Burch obtained a bachelor's degree
from The Citadel and his medical degree from the Medical College of Virginia.
WILLIAM W. COLEMAN, JR. (48). Mr. Coleman will serve as the President
and Chief Executive Officer of the Proposed Bank. From January 1992 to July
1997, Mr. Coleman served as an Executive Vice President of the National Bank of
South Carolina, at which he supervised the Pee Dee region in South Carolina. Mr.
Coleman received a bachelor's degree from Francis Marion University in Florence,
South Carolina.
DR. WILLIE S. EDWARDS, JR. (43). Dr. Edwards has been an orthopedic
surgeon employed by Pee Dee Orthopedics since 1988. Dr. Edwards received his
bachelor's and medical degrees from the University of North Carolina at Chapel
Hill.
JAMES C. GREGG, JR. (48). Mr. Gregg has served as the County
Administrator for the Florence County Sheriffs' Office since January 1993. Mr.
Gregg received an associate's degree from Spartanburg Methodist College and is a
graduate of the South Carolina Justice Academy in Columbia, South Carolina.
DR. FRANCIS GREGG JONES (47). Dr. Jones has been employed since 1990 as
an anesthesiologist with Florence Anesthesia Associates, LLC. Dr. Jones received
a bachelor's degree from Clemson University and his medical degree from the
Medical University of South Carolina.
15
<PAGE> 17
SAMUEL A. RODGERS (67). Mr. Rodgers has been employed in various
capacities with Carolina Eastern, Inc., a distributor of agricultural products,
since 1972. Mr. Rodgers currently serves as the Vice Chairman of Carolina
Eastern, Inc.
DANIEL P. THOMPSON, SR. (69). Mr. Thompson retired as Executive Vice
President from Belk Department Stores in 1997.
Along with Robert R. Horger, Chairman of the Board of the Company, and
C. John Hipp, III, President and Chief Executive Officer of the Company, each of
the Organizers has agreed to serve as a director of the Proposed Bank upon its
organization. Further, subject to compliance with applicable securities laws,
the Organizers of the Proposed Bank collectively have indicated their desire to
purchase shares of Common Stock pursuant to this offering having an aggregate
sales price of approximately $400,000. However, the Organizers may subsequently
decide to purchase more or less shares.
MARKET AREA
The primary market area to be served by the Proposed Bank will be the
County of Florence, South Carolina and the immediately adjacent areas. Located
in the Pee Dee portion of South Carolina, Florence County covers approximately
805 square miles and is bordered by Darlington, Williamsburg, Marion, Clarendon
and Lee counties. The County's economy is based primarily on nonagricultural
activities, and major employment groups are manufacturing, wholesale and retail
trade and services. The County is served by Interstate 95, which is the
principal route between Maine and Florida, and Interstate 20, which runs from
Florence, South Carolina to El Paso, Texas. According to the South Carolina
Municipal Council, the population of Florence County at December 31, 1996 was
estimated to be approximately 122,600. The City of Florence is the county seat
of the County, and the City of Florence is the largest city in the County.
COMPETITION
South Carolina law permits statewide branching by banks and savings and
loan associations, and many financial institutions have branch networks. South
Carolina law also permits regional interstate banking, and four of the larger
commercial banks in the Florence area are affiliated with regional banking
groups, including NationsBank, N.A., First Union National Bank, Wachovia, N.A.
and Branch Banking & Trust Company. Approximately 29 financial institutions are
represented in Florence County, including 14 banks with a total deposit size in
excess of $960 million, and 10 credit unions with aggregate deposits of
approximately $76 million. In addition, Community Bankshares of Orangeburg is in
the process of forming a new bank in Florence County to be known as "Florence
National Bank."
Banks generally compete with other financial institutions through the
banking products and services offered, the pricing of services, the level of
service provided, the convenience and availability of services, and the degree
of expertise and personal concern with which services are offered. The Proposed
Bank will encounter strong competition from the financial institutions in its
extended market area. In the conduct of certain areas of its banking business,
the Proposed Bank will also compete with credit unions, consumer finance
companies, insurance companies, money market mutual funds and other financial
institutions, some of which are not subject to the same degree of regulation and
restrictions imposed upon the Proposed Bank. Many of these competitors have
substantially greater resources and lending limits than the Proposed Bank will
have and offer certain services, such as international banking services, that
the Proposed Bank will not provide initially. Moreover, most of these
competitors have numerous branch offices located throughout the extended market
area. This is a competitive advantage that the Proposed Bank will not have in
the near future.
16
<PAGE> 18
The Company believes that the relatively small size of the Proposed
Bank will permit it to offer more personalized service than many of its
competitors, which may provide a competitive advantage. The Company also
believes that the Proposed Bank may be able to compensate for its lower initial
lending limits by participating in larger loans with FNB, NBYC and other
institutions.
SERVICES TO BE OFFERED
The Proposed Bank plans to emphasize local management and commitment to
the industrial and business growth of the Florence County area. The Proposed
Bank intends to provide personalized banking services, with an emphasis on
knowing the individual financial needs and objectives of its customers and
having available an appropriate array of services to meet those needs and
objectives.
The services to be offered by the Proposed Bank include a full range of
deposit services that are typically available at most banks and savings and loan
associations, such as business and consumer checking accounts, NOW (negotiable
orders of withdrawal) accounts, savings accounts, money market accounts, term
certificates of deposit and IRAs (individual retirement accounts). The
transaction accounts and time certificates will be tailored to the principal
market area at rates competitive with those offered in the area. All deposit
accounts will be insured by the FDIC up to the maximum amount permitted by law.
The Proposed Bank intends to solicit these accounts from individuals,
businesses, associations and organizations, and government authorities. Although
the Proposed Bank intends to be competitive in its efforts to attract deposit
accounts, it does not expect to aggressively seek jumbo certificates of deposit
(certificates in amounts greater than $100,000) and does not intend to accept
brokered deposit accounts.
The Proposed Bank will offer a full range of short- and
intermediate-term commercial and consumer loans with variable and fixed interest
rates. Consumer loans are expected to include car loans, mobile home loans, boat
loans, home equity loans secured by first and second mortgages, personal
expenditure loans and education loans. Commercial loans, secured and unsecured,
will be made primarily to individuals and small and mid-sized businesses
operating in and around Florence County. These loans will be available for
general operating purposes, acquisition of fixed assets, including real estate,
purchases of equipment and machinery, financing of inventory and accounts
receivable, and other business purposes.
The Proposed Bank may participate in a regional network of automated
teller machines that may be used by its customers in major cities throughout the
Southeast. The Proposed Bank plans to offer both VISA and MasterCard brand
credit cards together with related lines of credit. Lines of credit may also be
offered for overdraft protection as well as a pre-authorized credit for personal
purchases and expenses.
The Proposed Bank will also provide safe deposit boxes, travelers
checks, direct deposit of payroll and social security checks, and automatic
drafts for various accounts, but will not provide international banking services
at any time in the near future.
DATA PROCESSING
FNB will provide computer and item processing services for the Proposed
Bank, which the Company expects will result in cost savings to FNB and the
Proposed Bank.
PREMISES
The principal offices of the Proposed Bank will be located at 1600 W.
Palmetto Street, Florence, South Carolina 29501. The Company acquired this
property from an unaffiliated third party. FNC will transfer the property to the
Proposed Bank at FNC's cost.
17
<PAGE> 19
EMPLOYEES
It is anticipated that the Proposed Bank will employ approximately 16
full-time employees during its first year of operations. To the extent possible,
the Proposed Bank will employ people experienced in the banking profession, and
efforts will be made to employ people who are natives of the Florence County
area or who are knowledgeable about the area.
EXPERTS
The consolidated balance sheets of the Company as of December 31, 1996,
1995 and 1994, and the related consolidated statements of income and cash flows
for each of the years then ended, and changes in shareholders' equity for the
three-year period ended December 31, 1996, included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996 have been audited by
J.W. Hunt and Company, LLP, independent certified public accountants, as
indicated in their report with respect thereto, dated January 27, 1997, and are
incorporated by reference herein in reliance upon the authority of J.W. Hunt and
Company, LLP, as experts in accounting and auditing.
LEGAL MATTERS
Certain legal matters in connection with the offering will be passed
upon for the Company by Robinson, Bradshaw & Hinson, P.A., Charlotte, North
Carolina.
18
<PAGE> 20
APPENDIX A
FIRST NATIONAL CORPORATION
SUBSCRIPTION AGREEMENT
The undersigned, having received and reviewed the Prospectus, dated
_________________ (the "Prospectus"), of First National Corporation, subject to
the terms and conditions of the Prospectus, hereby subscribes for the number of
shares of Common Stock of the Company set forth below. The undersigned tenders
herewith the purchase price for such shares, as calculated below. All payments
shall be in United States dollars in cash or by check, draft or money order
drawn to the order of "First National Corporation." Capitalized terms used but
not defined herein shall have the meanings ascribed to them in the Prospectus.
Your Properly Completed Subscription Form and Payment Must Be Returned
To:
FIRST NATIONAL CORPORATION OR FIRST NATIONAL CORPORATION
950 John C. Calhoun Drive, S.E. 1600 W. Palmetto Street
Orangeburg, South Carolina 29115 Florence, South Carolina 29501
(803) 531-0527 Attention: W. Louis Griffith
Attention: W. Louis Griffith
OR FIRST NATIONAL CORPORATION
Post Office Box 1287
Orangeburg, South Carolina 29116-1287
Attention: W. Louis Griffith
Acknowledgments and Representations
In connection with this subscription, the undersigned hereby
acknowledges and agrees that:
(1) Upon acceptance in writing by the Company, this subscription may not be
cancelled, terminated or revoked by the undersigned, and this
Subscription Agreement will be binding and legally enforceable. This
subscription shall be deemed accepted only upon agreement thereto by C.
John Hipp, III, President and Chief Executive Officer of the Company,
or W. Louis Griffith, Chief Financial Officer of the Company. No other
person has authority to accept or reject a subscription on behalf of
the Company.
(2) The Company reserves the right to accept this subscription in whole or
in part and to reject this subscription completely. If this
subscription is accepted in part, the undersigned agrees to purchase
the accepted number of shares subject to all of the terms of this
offer.
(3) The Company reserves the right to cancel this subscription after
acceptance until the date accepted shares of the Common Stock are
issued.
(4) If this subscription is canceled in whole or in part, the corresponding
portion of any funds received by FNC relating to this subscription
shall be returned to the undersigned. No interest will be paid on any
such returned funds.
(5) The shares of Common Stock subscribed for hereby are equity securities
and are not savings accounts or deposits, and INVESTMENT THEREIN IS NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION.
(6) This subscription is nonassignable and nontransferable, except with the
written consent of the Company.
A-1
<PAGE> 21
(7) Certificates will be delivered by first class mail to the address set
forth herein.
(8) The undersigned has received a copy of the Prospectus. The undersigned
represents that this Subscription Agreement is made solely on the basis
of the information contained or incorporated by reference in the
Prospectus and is not made in reliance on any inducement,
representation or statement not contained or incorporated by reference
in such document. No person (including any officer or director of FNC
or the Proposed Bank) has authority to give any information or to make
any representation not contained in the Prospectus, and if given or
made, such information or representation must not be relied upon as
having been authorized by the Company.
I hereby subscribe for the following shares of Common Stock:
Number of Shares I want to buy is ___________ Shares x $_____* = $___________.**
My payment of that amount is enclosed.
* The subscription price must be equal to the closing sale price of the
Common Stock, as reported by the American Stock Exchange, on any of the
five business days immediately preceding the day on which the undersigned
mails or hand delivers this Subscription Agreement to the Company, as the
case may be. For such purposes, a Subscription Agreement will be deemed to
have been mailed as of the day on which the envelope containing such
agreement is postmarked, and a Subscription Agreement will be deemed to
have been hand delivered to the Company as of the day on which an
authorized employee of the Company receives such agreement at any of the
Company's addresses set forth on the first page hereof. The subscription
price set forth above represents the closing sales price of the Common
Stock on _______________________, 1998.
** If this amount is more or less than the correct amount for the number of
shares shown or as to which the subscription is accepted, I want to buy as
many shares as this amount will buy at the purchase price set forth above.
- ------------------------------------------------------------------------------
(Name(s) in which stock certificates should be registered)
- ------------------------------------------------------------------------------
(Street Address)
- ------------------------------------------------------------------------------
(City/State/Zip Code)
- ------------------------------------------------------------------------------
(Social Security or Employer I.D. No.)
( ) ( )
--- --------------- --- -------------------
(Home Telephone No.) (Business Telephone No.)
Stock certificates for shares to be issued in the names of two or more
persons will be registered in the names of such persons as joint tenants
with right of survivorship, and not as tenants in common.
A-2
<PAGE> 22
SUBSTITUTE W-9
Under the penalties of perjury, I certify that:
(1) the Social Security number or taxpayer identification number given
herein is correct; and
(2) I am not subject to backup withholding.
INSTRUCTION: YOU MUST CROSS OUT #2 ABOVE IF YOU HAVE BEEN NOTIFIED BY THE
INTERNAL REVENUE SERVICE THAT YOU ARE SUBJECT TO BACKUP WITHHOLDING BECAUSE OF
UNDERREPORTING INTEREST OR DIVIDENDS ON YOUR TAX RETURN.
I HAVE READ AND UNDERSTAND THE PROSPECTUS AND THIS SUBSCRIPTION AGREEMENT.
- ------------------------------------- ------------------------------------
(Signature) (Date)
- ------------------------------------- ------------------------------------
(Signature) (Date)
If shares are to be held in joint ownership, all joint owners should
sign and date this Agreement.
A-3
<PAGE> 23
PART II: INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
<TABLE>
<S> <C>
Commission registration fee............................................ $ 740
Accounting fees........................................................ 10,000
Legal fees and expenses................................................ 30,000
Mailing and printing costs............................................. 15,000
Miscellaneous.......................................................... 4,260
-------
Total......................................................... $60,000
=======
</TABLE>
Item 15. Indemnification of Directors and Officers.
Under the South Carolina Business Corporation Act of 1988 (the "Act"),
a corporation has the power to indemnify directors and officers who meet the
standards of good faith and reasonable belief that conduct was lawful and in the
corporate interest (or not opposed thereto) set forth in such statute. The Act
also empowers a corporation to provide insurance for directors and officers
against liability arising out of their positions even though the insurance
coverage is broader than the power of the corporation to indemnify. Under the
Act, unless limited by its articles of incorporation, a corporation must
indemnify a director or officer who is wholly successful, on the merits or
otherwise, in the defense of any proceeding to which he was a party because he
is or was a director or officer against reasonable expenses incurred by him in
connection with the proceeding. The registrant's Articles of Incorporation do
not provide otherwise.
The registrant maintains directors and officers' liability insurance
for the benefit of its directors and officers.
Item 16. Exhibits.
See Exhibit Index below.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs 1(i) and 1(ii) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the
registration statement.
II-1
<PAGE> 24
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934
that is incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
II-2
<PAGE> 25
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Orangeburg, State of South Carolina, on February 2,
1998.
FIRST NATIONAL CORPORATION
By: /s/ C. John Hipp, III
----------------------------------------
C. John Hipp, III
President and Chief Executive Officer
Each person whose signature appears below hereby constitutes and
appoints C. John Hipp, III and W. Louis Griffith, and each of them, the true and
lawful attorneys-in-fact and agents of the undersigned, with full power of
substitution and resubstitution, for and in the name, place and stead of the
undersigned, in any and all capacities, to sign any and all amendments
(including post-effective amendments, exhibits thereto and other documents in
connection therewith) to this Registration Statement and any subsequent
registration statement filed by the Registrant pursuant to Rule 462(b) of the
Securities Act of 1933, which relates to this Registration Statement, and to
file the same, with all exhibits thereto and all documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done,
as fully to all intents and purposes as the undersigned might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their substitute, may lawfully do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Charles W. Clark Director February 2, 1998
- ------------------------------
(Charles W. Clark)
Director
- ------------------------------
(Cathy Cox Yeadon)
/s/ C. Parker Dempsey Director February 2, 1998
- ------------------------------
(C. Parker Dempsey)
/s/ Dwight W. Frierson Director February 2, 1998
- ------------------------------
(Dwight W. Frierson)
/s/ E. Everett Gasque, Jr. Director February 2, 1998
- ------------------------------
(E. Everett Gasque, Jr.)
/s/ John L. Gramling, Jr. Director February 2, 1998
- ------------------------------
(John L. Gramling, Jr.)
/s/ W. Louis Griffith Chief Financial Officer February 2, 1998
- ------------------------------ (Principal Financial and
(W. Louis Griffith) Accounting Officer)
</TABLE>
II-3
<PAGE> 26
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ C. John Hipp, III President, Chief Executive February 2, 1998
- ------------------------------ Officer and Director
(C. John Hipp, III) (Principal Executive Officer)
/s/ Robert R. Hill, Jr. Director February 2, 1998
- ------------------------------
(Robert R. Hill, Jr.)
/s/ Robert R. Horger Director February 2, 1998
- ------------------------------
(Robert R. Horger)
/s/ J. C. McAlhany Director February 2, 1998
- ------------------------------
J. S. McAlhany
/s/ Dick Gregg McTeer Director February 2, 1998
- ------------------------------
(Dick Gregg McTeer)
/s/ Harry M. Mims, Jr. Director February 2, 1998
- ------------------------------
(Harry M. Mims, Jr.)
/s/ E. V. Mirmow, Jr. Director February 2, 1998
- ------------------------------
(E. V. Mirmow, Jr.)
/s/ Ralph W. Norman, Jr. Director February 2, 1998
- ------------------------------
(Ralph W. Norman, Jr.)
/s/ Anne H. Oswald Director February 2, 1998
- ------------------------------
(Anne H. Oswald)
/s/ James W. Roquemore Director February 2, 1998
- ------------------------------
(James W. Roquemore)
/s/ Walter L. Tobin Director February 2, 1998
- ------------------------------
(Walter L. Tobin)
/s/ Johnny E. Ward Director February 2, 1998
- ------------------------------
(Johnny E. Ward)
/s/ A. Dewall Waters Director February 2, 1998
- ------------------------------
(A. Dewall Waters)
/s/ L. D. Westbury Director February 2, 1998
- ------------------------------
(L. D. Westbury)
</TABLE>
II-4
<PAGE> 27
EXHIBIT INDEX
Exhibit No. Description of Exhibit
4.1 The Sixth, Eighth, Ninth, Tenth, Thirteenth, Fourteenth,
Fifteenth, Sixteenth, Seventeenth and Eighteenth Articles of
the Articles of Incorporation of First National Corporation
(incorporated by reference to Quarterly Report on Form 10-Q
for the quarter ended June 30, 1996)
5 Opinion of Robinson, Bradshaw & Hinson, P.A.
21 Subsidiaries of the Registrant (incorporated by reference to
exhibits filed with Registration Statement on Form S-4,
Registration No. 33-52052)
23.1 Consent of J. W. Hunt and Company, LLP
23.2 Consent of Robinson, Bradshaw, & Hinson, P.A. (included in
Exhibit 5)
24 Power of Attorney (included on signature page)
<PAGE> 1
EXHIBIT 5
OPINION OF COUNSEL
ROBINSON, BRADSHAW & HINSON, P.A.
ATTORNEYS AT LAW
DAVID W. DABBS 101 NORTH TRYON STREET, SUITE 1900 SOUTH CAROLINA OFFICE
(704) 377-8383 CHARLOTTE, NORTH CAROLINA 28246 THE GUARDIAN BUILDING
FAX (704) 373-3983 TELEPHONE (704) 377-2536 W PLACE - SUITE 600
INTERNET [email protected] FAX (704) 378-4000 P.O. DRAWER 12070
ROCK HILL, S.C. 29731
TELEPHONE (803) 325-2900
FAX (803) 325-2929
February 2, 1998
First National Corporation
950 John C. Calhoun Drive, S.E.
Orangeburg, South Carolina 29115
Re: First National Corporation
Registration Statement on Form S-3
We have served as special counsel to First National Corporation (the
"Company") in connection with the preparation and filing by the Company of a
registration statement on Form S-3 (the "Registration Statement") with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended, relating to the offer and sale of 105,000 shares (the
"Shares") of the Company's common stock, par value $2.50 per share ("Common
Stock"). We understand that the Registration Statement was filed by the Company
with the Commission today.
We have examined the articles of incorporation and bylaws of the
Company, all corporate proceedings relating to the authorization, issuance and
sale of the Shares and such other documents and records as we have deemed
necessary in order to enable us to render the opinion herein expressed.
Based on the foregoing, and subject to the conditions set forth below,
we are of the opinion that the Shares, when issued and sold by the Company as
described in the Registration Statement, will be duly authorized, validly
issued, fully paid and nonassessable.
The opinions expressed herein are contingent upon the Registration
Statement becoming effective under the Securities Act. We hereby consent to the
filing of this opinion as Exhibit 5 to the Registration Statement and the use of
our name under the caption "Legal Matters" in the prospectus included as a part
thereof.
Sincerely yours,
ROBINSON, BRADSHAW & HINSON, P.A.
/s/ David W. Dabbs
David W. Dabbs
<PAGE> 1
EXHIBIT 23.1
ACCOUNTANTS' CONSENT
Board of Directors
First National Corporation
We consent to the incorporation by reference in First National Corporation's
Registration Statement on Form S-3, relating to the registration of 105,000
shares of its common stock, of our report dated January 27, 1997, which is
included in First National Corporation's Annual Report on Form 10-K for the year
ended December 31, 1996. We also consent to the reference to our name under the
caption "Experts" in the prospectus included as part of the Registration
Statement.
/s/ J.W. Hunt and Company, LLP
J. W. Hunt and Company, LLP
Columbia, South Carolina
February 2, 1998
