<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 1, 1998
REGISTRATION NO. 333-45435
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
AMENDMENT NO. 2
TO
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: [ ]
------------------------
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
SUBJECT TO COMPLETION, DATED APRIL 1, 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 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. Prospective investors
may select any closing sale price within such five-day period. However, in no
event may such price be less than $22.50 per share, and the Company will reject
any subscription offer at any price less than $22.50 per share. 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 March 31, 1998 was $25.06 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 7 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........................ $25.06 $0.00 $25.06
Total............................ $2,631,536 $0.00 $2,631,536
======================================================================================================
</TABLE>
(1) Estimated based on the reported last sale price of Common Stock on March
31, 1998.
(2) These securities will be offered by certain officers and directors of the
Company and certain officers and directors of the New 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 April 1, 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, 1997; and (ii) 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
Page
Available Information.........................................................2
Incorporation of Certain Documents by Reference...............................2
Summary.......................................................................4
Risk Factors..................................................................7
Use of Proceeds...............................................................9
Capitalization...............................................................10
Price of Common Stock and Dividends..........................................11
Selected Financial Data......................................................12
The Offering.................................................................13
The Company..................................................................15
The New Bank.................................................................16
Experts......................................................................19
Legal Matters................................................................19
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's
operating income to date has been attributable to the operations of FNB, and the
Company expects its future operations to be substantially dependent upon FNB,
particularly during the first several years of operations of NBYC and the New
Bank (as defined below). See "Risk Factors -- Risk Inherent in Establishment of
a New Business." The Company has just completed the organization of Florence
County National Bank, a national bank located in Florence, South Carolina (the
"New Bank") that opened for business on April 1, 1998. In connection with the
organization of the New Bank, FNC acquired for $4.5 million all the outstanding
capital stock of the New Bank using $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 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 New 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 New Bank in the Florence County area.
Accordingly, excluding shares of Common Stock reserved for sale to directors,
officers and employees of, and other individuals associated with, the Company
and the New Bank as discussed below, FNC reserves the right to reject
subscriptions from individuals who do not reside in Florence County and adjacent
areas. For more information about the Company and its subsidiaries, prospective
investors are urged to refer to the documents incorporated by reference into
this Prospectus. See "Incorporation of Certain Documents by Reference."
The New Bank is a national bank located in Florence, South Carolina.
The New Bank is a wholly-owned subsidiary of FNC and will operate with its own
Board of Directors and operating policies. The organizers (the "Organizers") of
the New 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. serves as
the President and Chief Executive Officer of the New Bank. None of the
Organizers serves on the Board of Directors of the Company, and except for Mr.
Coleman, none of the Organizers has any banking experience. 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 serves as a
director of the New Bank. The Company has reserved approximately 8,000 shares of
Common Stock offered hereby for sale to directors, officers and employees of,
and other individuals associated with, the Company and 16,000 shares of Common
Stock offered hereby for sale to the Organizers.
4
<PAGE> 6
THE OFFERING
Shares of Common Stock offered(1).......... 105,000 shares
Offering price per share................... Closing sale price of the Common
Stock, as reported by the
American Stock Exchange, 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.
Prospective investors may select
any closing sale price within
such five-day period. However,
in no event may such price be
less than $22.50 per share, and
the Company will reject any
subscription offer at any price
less than $22.50 per share. The
closing sale price of the Common
Stock is reported from time to
time in the Wall Street Journal.
Minimum individual purchase (2)............ 100 shares
Maximum individual purchase (2)............ 7,500 shares
Use of proceeds............................ 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 New Bank.
- -------------------
(1) The Company has reserved approximately 8,000 shares of Common Stock
offered hereby for sale to directors, officers and employees of, and
certain individuals associated with, the Company and 16,000 shares of
Common Stock offered hereby for sale to the Organizers.
(2) The Company reserves the right, in its sole discretion, to alter the
individual minimum and maximum purchase amounts. See "The Offering."
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").
5
<PAGE> 7
SUMMARY FINANCIAL DATA
(Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
Years Ended December 31,
------------------------------------------------
STATEMENT OF INCOME DATA: 1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Total interest income........................... $ 41,144 $ 34,263 $ 30,183
Total interest expense.......................... 17,365 13,986 12,525
Provision for loan losses....................... 1,251 1,319 844
Total noninterest income........................ 6,259 5,344 4,049
Total noninterest expense....................... 19,454 16,352 14,321
Income before income taxes...................... 9,333 7,950 6,542
Net income...................................... 6,466 5,528 4,640
Net income per common
share(1).................................... 1.26 1.14 .98
Cash dividends per common
share(1).................................... .40 .37 .34
</TABLE>
<TABLE>
<CAPTION>
December 31,
------------
1997
----
<S> <C>
BALANCE SHEET DATA:
Total investment securities..................... $166,061
Loans........................................... 359,167
Less: Unearned income..................... (3,654)
Allowance for loan losses........... (5,518)
--------
Loans, net...................... 349,995
Allowance for loan losses as a percentage
of nonperforming loans........................ 5.43%
Total assets.................................... 565,571
Total deposits.................................. 454,375
Total liabilities............................... 511,671
Shareholders' equity............................ 53,900
</TABLE>
- -------------------
(1) Per share data have been retroactively adjusted to give retroactive effect
to stock dividends and stock splits.
6
<PAGE> 8
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 NEW 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
Upon receipt of a subscription agreement from a prospective investor,
the Company will review such agreement and make a decision as to whether such
agreement will be accepted by the Company. For each agreement that is rejected
by the Company, the Company will return to the prospective investor all
subscription proceeds submitted with such agreement without interest. For each
agreement that is accepted by the Company, the Company will instruct its
transfer agent to issue to the investor a certificate evidencing shares of
Common Stock subscribed for. The Company expects to be able to make a decision
with respect to each subscription agreement within two weeks after such
agreement is received by the Company. Accordingly, there may be a slight delay
between the time an investor submits his or her subscription agreement 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. The Company will promptly return to prospective
investors subscription proceeds with regard to any subscription offer that is
not accepted by the Company. 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 New Bank has just emerged from the organizational stage and has no
operating history. Accordingly, prospective investors have limited information
relating to the prospects for success of the New Bank or the effect the New 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 New 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
New Bank will ever operate profitably.
7
<PAGE> 9
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.
8
<PAGE> 10
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 $25.06 on March 31, 1998, the net proceeds to the Company
from this offering would be approximately $2,571,563, after deducting estimated
offering expenses of $60,000. The Company intends to use up to $2.5 million to
repay amounts outstanding under the Line of Credit, which was incurred by the
Company in connection with the acquisition of the outstanding capital stock of
the New 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 New
Bank and for general corporate purposes.
BY THE NEW BANK
The Company acquired for $4.5 million all the outstanding capital stock
of the New Bank using available cash resources and proceeds available under the
Line of Credit. Of the $4.5 million received by the New Bank from the sale of
its capital stock to the Company, approximately $350,000 was used to purchase
from FNC (at FNC's cost) land on which the New Bank is located, approximately
$650,000 was used to build the New Bank's offices, approximately $300,000 was or
will be used for equipment and furnishings and approximately $180,000 will be
used to fund the estimated expenses of organizing the New Bank. The balance of
the proceeds from the sale of the stock of the New Bank to the Company will be
used by the New Bank for general corporate purposes.
9
<PAGE> 11
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
December 31, 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 March 31, 1998 of $25.06 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
March 31, 1998, the as adjusted total shareholders' equity would be less than
the amount set forth below.
<TABLE>
<CAPTION>
December 31, 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 25,566
Retained earnings...................................... 17,197 17,197
Unrealized gain (loss) on securities
available-for-sale, net................................ 476 476
------- -------
Total shareholders' equity..................... 53,900 56,472
Total capitalization........................... $53,900 $56,472
======= =======
</TABLE>
10
<PAGE> 12
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........................................ $ 25.88 $ 22.50 .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
Office of the Comptroller of the Currency 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 December 31, 1997, $9,466,000 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 year
ended December 31, 1997, FNB paid dividends to the Company of approximately
$2,059,000.
11
<PAGE> 13
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, 1997 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 should be read in conjunction with the
Company's consolidated financial statements and the notes thereto. See "Summary
- -- Recent Developments."
<TABLE>
<CAPTION>
Years Ended December 31,
--------------------------------------------------
STATEMENT OF INCOME DATA: 1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Total interest income................. $ 41,144 $ 34,263 $ 30,183
Total interest expense................ 17,365 13,986 12,525
Provision for loan losses............. 1,251 1,319 844
Total noninterest income.............. 6,259 5,344 4,049
Total noninterest expense............. 19,454 16,352 14,321
Income before income taxes........ 9,333 7,950 6,542
Net income............................ 6,466 5,528 4,640
Net income per common share(1).... 1.26 1.14 .98
Cash dividends per common share(1) .40 .37 .34
</TABLE>
<TABLE>
<CAPTION>
December 31,
------------------------------------------------
1997 1996 1995
---- ---- ----
BALANCE SHEET DATA:
<S> <C> <C> <C>
Total investment securities........... $166,061 $160,881 $151,496
Loans................................. 359,167 296,865 250,423
Less: Unearned income.......... (3,654) (3,246) (2,540)
Allowance for loan losses (5,518) (4,705) (3,703)
----------- ----------- -----------
Loans, net........... 349,995 288,914 244,180
Allowance for loan losses as a
percentage of nonperforming
loans.............................. 5.43% 4.83% 4.38%
Total assets.......................... 565,571 497,632 436,322
Total deposits........................ 454,375 414,153 368,315
Total liabilities..................... 511,671 449,286 396,545
Shareholders' equity.................. 53,900 48,346 39,777
</TABLE>
- ---------------------
(1) Per share data have been retroactively adjusted to give retroactive effect
to stock dividends and stock splits.
12
<PAGE> 14
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. Accordingly, an
investor may select any closing sale price of the Common Stock, as reported on
the American Stock Exchange, on any of the five business days prior to the day
on which an investor mails or hand delivers his Subscription Agreement to the
Company. However, in no event may such price be less than $22.50 per share, and
the Company will reject any subscription offer at any price less than $22.50 per
share 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, ALTHOUGH THE COMPANY WILL NOT REJECT ANY
SUBSCRIPTION OFFER BASED ON THE SUBSCRIPTION PRICE IF SUCH PRICE (DETERMINED AS
SET FORTH ABOVE) IS EQUAL TO OR MORE THAN $22.50 PER SHARE.
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 New
Bank. No commission or other compensation will be paid to any person in
connection with the sale of shares of Common Stock offered hereby.
13
<PAGE> 15
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 New Bank in the Florence County area.
Accordingly, excluding 24,000 shares of Common Stock offered hereby reserved for
sale to directors, officers and employees of, and other individuals associated
with, the Company and the New Bank, FNC reserves the right to reject
subscriptions from individuals who do not reside in Florence County and adjacent
areas.
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 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.
14
<PAGE> 16
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. The Company's operating income
to date has been attributable to the operations of FNB, and the Company expects
its future operations to be substantially dependent upon FNB, particularly
during the first several years of operations of NBYC and the New Bank. See "Risk
Factors -- Risk Inherent in Establishment of a New Business." For more
information about the Company and its subsidiaries, prospective investors are
urged to refer to the documents incorporated by reference into this Prospectus.
See "Incorporation of Certain Documents by Reference."
In connection with the organization of the New Bank, the Company
acquired all the outstanding capital stock of the New Bank for $4.5 million
using $2.5 million borrowed under the Line of Credit. The net proceeds of this
offering will be used 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 New 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 New Bank are located at 1600 W. Palmetto
Street, Florence, South Carolina 29501.
15
<PAGE> 17
THE NEW 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.
In recent years, the Company has explored opportunities to expand its
community banking network into other regions in South Carolina. In 1996, the
Company organized NBYC in Rock Hill, South Carolina, an area that the Company
believes offers growth potential and a favorable market for the Company's
community banking philosophy. In mid-1997, the Company identified Florence,
South Carolina as a growth market that has recently been affected by bank
consolidations and acquisitions, thereby making it receptive to the Company's
community banking approach. As part of the Company's decision to expand into
Florence, South Carolina, the Company selected William W. Coleman, Jr. to be the
President and Chief Executive Officer of the New Bank and worked with Mr.
Coleman to identify businessmen in the Florence community who would be willing
and qualified to serve as the organizers of the New Bank. The New Bank opened
for business on April 1, 1998.
ORGANIZERS OF THE NEW BANK
Set forth below is brief biographical information about the Florence
businessmen who are the Organizers of the New Bank.
STARLEE B. ALEXANDER (41). 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 (61). 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 is the President and Chief
Executive Officer of the New 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.
16
<PAGE> 18
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.
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.
None of the Organizers serves on the Board of Directors of the Company,
and except for Mr. Coleman, none of the Organizers has any banking experience.
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 serves as a director of the New Bank. Further, subject to compliance
with applicable securities laws, the Organizers of the New 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 New 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 New Bank
will encounter strong competition from the financial institutions in its
17
<PAGE> 19
extended market area. In the conduct of certain areas of its banking business,
the New 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 New Bank. Many of these competitors have substantially greater
resources and lending limits than the New Bank will have and offer certain
services, such as international banking services, that the New 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 New Bank will not have in the near future.
The Company believes that the relatively small size of the New 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
New 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 New Bank plans to emphasize local management and commitment to the
industrial and business growth of the Florence County area. The New 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 New 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 New Bank intends to solicit these accounts from individuals, businesses,
associations and organizations, and government authorities. Although the New
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 New 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 New 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 New 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 New 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.
18
<PAGE> 20
DATA PROCESSING
FNB will provide computer and item processing services for the New
Bank, which the Company expects will result in cost savings to FNB and the New
Bank.
PREMISES
The principal offices of the New Bank are located at 1600 W. Palmetto
Street, Florence, South Carolina 29501. The Company acquired this property from
an unaffiliated third party. FNC transferred the property to the New Bank at
FNC's cost.
EMPLOYEES
It is anticipated that the New Bank will employ approximately 16
full-time employees during its first year of operations. To the extent possible,
the New 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, 1997,
1996 and 1995, 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, 1997, included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1997 have been audited by
J.W. Hunt and Company, LLP, independent certified public accountants, as
indicated in their report with respect thereto, dated February 2, 1998, 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.
19
<PAGE> 21
APPENDIX A
FIRST NATIONAL CORPORATION
SUBSCRIPTION AGREEMENT
The undersigned, having received and reviewed the Prospectus, dated
April 1, 1998 (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> 22
(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 New 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.
- ------------------------------------------------------------------------------
(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> 23
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> 24
PART II: INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
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
=======
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> 25
(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> 26
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 Amendment
No. 2 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Orangeburg, State of
South Carolina, on April 1,1998.
FIRST NATIONAL CORPORATION
By: /s/ C. John Hipp, III
--------------------------------
C. John Hipp, III
President and Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 2 to the 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 April 1,1998
- ------------------------------
(Charles W. Clark)
- ------------------------------ Director
(Cathy Cox Yeadon)
/s/ C. Parker Dempsey * Director April 1,1998
- ------------------------------
(C. Parker Dempsey)
/s/ Dwight W. Frierson * Director April 1,1998
- ------------------------------
(Dwight W. Frierson)
/s/ E. Everett Gasque, Jr. * Director April 1, 1998
- ------------------------------
(E. Everett Gasque, Jr.)
/s/ John L. Gramling, Jr. * Director April 1,1998
- ------------------------------
(John L. Gramling, Jr.)
/s/ W. Louis Griffith Chief Financial Officer April 1,1998
- ------------------------------ (Principal Financial and Accounting
(W. Louis Griffith) Officer)
/s/ C. John Hipp, III President, Chief Executive April 1,1998
- ------------------------------ Officer and Director
(C. John Hipp, III) (Principal Executive Officer)
/s/ Robert R. Hill, Jr. * Director April 1,1998
- ------------------------------
(Robert R. Hill, Jr.)
/s/ Robert R. Horger * Director April 1,1998
- ------------------------------
(Robert R. Horger)
/s/ J. C. McAlhany * Director April 1,1998
- ------------------------------
J. S. McAlhany
</TABLE>
II-3
<PAGE> 27
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Dick Gregg McTeer * Director April 1,1998
- ------------------------------
(Dick Gregg McTeer)
/s/ Harry M. Mims, Jr. * Director April 1,1998
- ------------------------------
(Harry M. Mims, Jr.)
/s/ E. V. Mirmow, Jr. * Director April 1,1998
- ------------------------------
(E. V. Mirmow, Jr.)
/s/ Ralph W. Norman, Jr. * Director April 1,1998
- ------------------------------
(Ralph W. Norman, Jr.)
/s/ Anne H. Oswald * Director April 1,1998
- ------------------------------
(Anne H. Oswald)
/s/ James W. Roquemore * Director April 1,1998
- ------------------------------
(James W. Roquemore)
/s/ Walter L. Tobin * Director April 1,1998
- ------------------------------
(Walter L. Tobin)
/s/ Johnny E. Ward * Director April 1,1998
- ------------------------------
(Johnny E. Ward)
/s/ A. Dewall Waters * Director April 1,1998
- ------------------------------
(A. Dewall Waters)
/s/ L. D. Westbury * Director April 1,1998
- ------------------------------
(L. D. Westbury)
*By: /s/ W. Louis Griffith April 1,1998
- ------------------------------
W. Louis Griffith
Attorney-in-Fact
</TABLE>
II-4
<PAGE> 28
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)
- ------------------------
*Previously filed.
<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 February 2, 1998, which is
included in First National Corporation's Annual Report on Form 10-K for the year
ended December 31, 1997. We also consent to the reference to our name under the
captions "Selected Financial Data" and "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
April 1, 1998
