SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Sec. 14(a) of the Securities Exchange Act of 1934.
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2)
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
FIRST UNITED BANCORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)and 0-11.
1)
Title of each class of securities to which transaction applies:
-----------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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4) Proposed maximum aggregate value of transaction:-----------------
5) Total fee paid:--------------------------------------------------
[ ] Fee paid previously with preliminary materials
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:-----------------------------------------
2) Form, Schedule or Registration Statement No.:-------------------
3) Filing Party:---------------------------------------------------
4) Date Filed:-----------------------------------------------------
<PAGE>
FIRST UNITED BANCORPORATION
304 North Main Street
Anderson, South Carolina 29621
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held April 23, 1996
TO THE SHAREHOLDERS:
Notice is hereby given that the Annual Meeting of the Shareholders (the
"Annual Meeting") of First United Bancorporation, a South Carolina corporation
(the "Company"), will be held at the main office of Anderson National Bank, 304
North Main Street, Anderson, South Carolina at 5:30 p.m., Anderson, South
Carolina time, on April 23, 1996, for the following purposes:
(1) To elect four directors of the Company to serve three-year terms;
(2) To ratify the appointment of KPMG Peat Marwick LLP as independent
auditors for the Company for the fiscal year ending December 31, 1996; and
(3) To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
Only record holders of Common Stock of the Company at the close of
business on March 15, 1996, are entitled to notice of and to vote at the Annual
Meeting or any adjournment thereof.
You are cordially invited and urged to attend the Annual Meeting in
person. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE
REQUESTED TO COMPLETE, DATE, SIGN AND PROMPTLY RETURN THE ENCLOSED PROXY IN THE
ENCLOSED, SELF- ADDRESSED, STAMPED ENVELOPE. IF YOU NEED ASSISTANCE IN
COMPLETING YOUR PROXY, PLEASE CALL THE COMPANY AT TELEPHONE NUMBER (864)
224-1112. IF YOU ATTEND THE ANNUAL MEETING AND DESIRE TO REVOKE YOUR PROXY AND
VOTE IN PERSON YOU MAY DO SO. IN ANY EVENT, A PROXY MAY BE REVOKED AT ANY TIME
BEFORE IT IS EXERCISED.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
APPROVAL OF ALL THE PROPOSALS PRESENTED.
By Order of the Board of Directors
Mason Y. Garrett
President
Anderson, South Carolina
April 4, 1996
<PAGE>
FIRST UNITED BANCORPORATION
304 North Main Street
Anderson, South Carolina 29621
PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
to be Held April 23, 1996
-------------------------------------------------
This Proxy Statement is furnished to shareholders of First United
Bancorporation, a South Carolina corporation (herein, unless the context
otherwise requires, together with its subsidiaries, the "Company"), in
connection with the solicitation of proxies by the Company's Board of Directors
for use at the Annual Meeting of Shareholders to be held at the main office of
Anderson National Bank, 304 North Main Street, Anderson, South Carolina at 5:30
p.m., Anderson, South Carolina time on April 23, 1996 or any adjournment thereof
(the "Annual Meeting"), for the purposes set forth in the accompanying Notice of
Annual Meeting of Shareholders.
Solicitation of proxies may be made in person or by mail, telephone or
telegraph by directors, officers and regular employees of the Company. The
Company may also request banking institutions, brokerage firms, custodians,
nominees and fiduciaries to forward solicitation materials to the beneficial
owners of Common Stock of the Company held of record by such persons, and the
Company will reimburse the reasonable forwarding expenses. The cost of
solicitation of proxies will be paid by the Company. This Proxy Statement was
first mailed to shareholders on or about April 4, 1996.
The Company has its principal executive offices at 304 North Main Street,
Anderson, South Carolina 29621. The Company's telephone number is (864)
224-1112.
ANNUAL REPORT
The Annual Report to Shareholders covering the Company's fiscal year ended
December 31, 1995, including financial statements, is enclosed herewith. Such
Annual Report to Shareholders does not form any part of the material for the
solicitation of proxies.
REVOCATION OF PROXY
Any shareholder returning the accompanying proxy may revoke such proxy at
any time prior to its exercise (a) by giving written notice to the Company of
such revocation, (b) by voting in person at the meeting, or (c) by executing and
delivering to the Company a later dated proxy. Attendance at the Annual Meeting
will not in itself constitute revocation of a proxy. Any written notice or proxy
revoking a proxy should be sent to First United Bancorporation, 304 North Main
Street, Anderson, South Carolina 29621, Attention: William B. West, Secretary.
Written notice of revocation or delivery of a later dated proxy will be
effective upon receipt thereof by the Company.
QUORUM AND VOTING
The Company's only voting security is its $1.67 par value Common Stock
("Common Stock"), each share of which entitles the holder thereof to one vote on
each matter to come before the Annual Meeting. At the close of business on March
15, 1996 (the "Record Date"), the Company had issued and outstanding 2,326,804
shares of Common Stock, which were held of record by approximately 600 persons.
Only shareholders of record at the close of business on the Record Date are
entitled to notice of and to vote on matters that come before the Annual
Meeting. Notwithstanding the Record Date specified above, the Company's stock
transfer books will not be closed and shares of the Common Stock may be
transferred subsequent to the Record Date. However, all votes must be cast in
the names of holders of record on the Record Date.
<PAGE>
The presence in person or by proxy of the holders of a majority of the
outstanding shares of Common Stock entitled to vote at the Annual Meeting is
necessary to constitute a quorum at the Annual Meeting. If a share is
represented for any purpose at the Annual Meeting by the presence of the
registered owner or a person holding a valid proxy for the registered owner, it
is deemed to be present for the purposes of establishing a quorum. Therefore,
valid proxies which are marked "Abstain" or "Withhold" or as to which no vote is
marked, including proxies submitted by brokers that are the record owners of
shares (so-called "broker non-votes"), will be included in determining the
number of votes present or represented at the Annual Meeting. If a quorum is not
present or represented at the meeting, the shareholders entitled to vote,
present in person or represented by proxy, have the power to adjourn the meeting
from time to time, without notice other than an announcement at the meeting,
until a quorum is present or represented. The Company will issue a press release
if the meeting is adjourned, informing shareholders of the time and place where
the meeting will be reconvened. Directors, officers and regular employees of the
Company may solicit proxies for the reconvened meeting in person or by mail,
telephone or telegraph. At any such reconvened meeting at which a quorum is
present or represented, any business may be transacted that might have been
transacted at the meeting as originally noticed.
If a quorum is present at the meeting, directors will be elected by a
plurality of the votes cast by shares present and entitled to vote at the
meeting. Votes that are withheld or shares that are not voted in the election of
directors will have no effect on the outcome of election of directors.
Cumulative voting will not be permitted.
All other matters which may be considered and acted upon by the holders of
Common Stock at the Annual Meeting require that the number of shares of Common
Stock voted in favor of the proposal exceed the number of shares of Common Stock
voted against the proposal, provided a quorum is present.
ACTIONS TO BE TAKEN BY THE PROXIES
Each proxy, unless the shareholder otherwise specifies therein, will be
voted "FOR" the election of the person named in this Proxy Statement as the
Board of Directors' nominee for election to the Board of Directors, and "FOR"
the ratification of the appointment of KPMG Peat Marwick LLP as accountants for
the fiscal year ending December 31, 1996. In each case where the shareholder has
appropriately specified how the proxy is to be voted, it will be voted in
accordance with his specifications. As to any other matter of business which may
be brought before the Annual Meeting, a vote may be cast pursuant to the
accompanying proxy in accordance with the best judgment of the persons voting
the same, but the Board of Directors does not know of any such other business.
STOCKHOLDER PROPOSALS
Any shareholder of the Company desiring to present a proposal for action
at the 1997 Annual Meeting of Shareholders must deliver the proposal to the
executive offices of the Company no later than December 15, 1996. Only proper
proposals that are timely received will be included in the Company's Proxy
Statement and Proxy.
PRINCIPAL SHAREHOLDERS
The following table sets forth, as of March 15, 1996, the number and
percentage of outstanding shares beneficially owned by (i) each person known by
the Company to own more than 5% of the outstanding Common Stock, (ii) each
director of the Company, (iii) each person named in the Summary Compensation
Table, and (iv) all executive officers and directors of the Company as a group.
2
<PAGE>
<TABLE>
<CAPTION>
Name (and address Number of Shares Percent of
of 5% shareholders) Beneficially Owned (1) Class
- ------------------- ---------------------- --------
<S> <C> <C> <C>
Mason Y. Garrett
1601 North Boulevard
Anderson, SC 29621 401,498 (2) 17.0
James G. Bagnal, III 30,102 (3) 1.3
Irvin L. Cauthen 84,606 (4) 3.6
Ronald K. Earnest 17,609 (5) 0.8
J. Berry Garrett 95,529 (6) 4.1
Randolph V. Hayes 32,077 (7) 1.4
J. Donald King, Sr. 23,922 (8) 1.0
Roy D. Little 3,756 (9) 0.2
T. Ree McCoy, Jr. 85,160 (10) 3.7
G. Weston Nalley 37,282 (11) 1.6
Robert V. Pinson 10,518 0.4
Donald C. Roberts, M.D. 33,827 (12) 1.4
Harold P. Threlkeld 7,934 (13) 0.3
William B. West 27,556 (14) 1.2
All Executive Officers and
Directors as a
Group (14 persons) 883,799 36.6
</TABLE>
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(1) Unless otherwise indicated, each individual has sole voting and
investment power with respect to all shares owned by such individual.
Each named person or group is deemed to be the beneficial owner of
securities which may be acquired within 60 days through the exercise of
options, warrants and rights, if any, and such securities are deemed to
be outstanding for the purpose of computing the percentage of class
beneficially owned by such person or group. Such securities are not
deemed to be outstanding for the purpose of computing the percentage of
class beneficially owned by any other person or group. Accordingly, the
indicated number of shares includes shares issuable upon exercise of
options (including employee stock options) held by such person or group.
(2) Includes 9,119 shares held by Edgar Norris for Mr. Garrett's IRA, 142,265
shares held as custodian for Mr. Garrett's children, 10,641 shares owned
by Mr. Garrett's wife, 7,577 shares owned by the Garrett Motel Trust,
10,068 shares held by a trust for the benefit of an immediate family
member sharing the same household of which Mr. Garrett is the settlor,
but is not a trustee, cannot revoke the trust, and has no investment
control over the trust, and 33,166 shares subject to presently
exercisable stock options.
(3) Includes 10,990 shares held by Smith Barney as Custodian for Mr. Bagnal's
IRA and 19,112 shares subject to presently exercisable stock options.
(4) Includes 44,852 shares held by Plez-U-Stores, which is owned by Mr.
Cauthen.
(5) Includes 12,645 shares subject to presently exercisable stock options.
(6) Includes 945 shares owned by Mr. Garrett's wife, 4,743 shares held as
custodian for Mr Garrett's children, 24,034 shares held by Mr. Garrett's
brother as custodian for Mr. Garrett's children, 38,545 shares held as
custodian for Mr. Garrett's brother, 7,577 shares owned by the Garrett
Motel Trust.
(7) Includes 20,840 shares held by Ralph Hayes Motors, and 10,899 shares held
by Edgar Norris & Co., as Custodian for Mr. Hayes' IRA.
(8) Includes 4,884 shares held by Mr. King's wife.
(9) Includes 2,756 shares subject to presently exercisable stock options.
(10) Includes 27,513 shares held by T. Ree McCoy & Son, Inc. and 3,492 shares
owned by Mr. McCoy's wife.
(11) Includes 5,728 shares held by Mr. Nalley's wife and 5,728 shares held as
custodian for his daughter.
(12) Includes 23,161 shares held by Edgar Norris and Company as Trustee for
Donald C. Roberts, M.D., P.A., Profit Sharing Plan.
(13) Includes 3,073 shares owned by Mr. Threlkeld's wife.
(14) Includes 883 shares owned by Mr. West's wife, 2,359 shares held by BB&T,
as Custodian for Mr. West's IRA, and 22,112 shares subject to presently
exercisable stock options.
3
<PAGE>
The Company has granted options to purchase 236,046 shares of Common
Stock to certain executive officers and significant employees.
ELECTION OF DIRECTORS
The Board of Directors has, by resolution, fixed the number of directors
at 13, and four directors will be elected at the Annual Meeting to serve for
three-year terms or until their successors are elected and qualified to serve.
The Board of Directors' nominees, J. Berry Garrett, Randolph V. Hayes, Harold P.
Threlkeld and William B. West, are presently directors of the Company and have
served continuously since first becoming a director.
Should any of the above become unable or unwilling to accept nomination
or election, it is intended that the persons acting under the proxy will vote
for the election, in his stead, of such other person or persons as the Board of
Directors of the Company may recommend. The Board of Directors has no reason to
believe that any of the proposed directors will be unable or unwilling to serve
if elected.
MANAGEMENT
The following table sets forth certain information with respect to the
directors and executive officers of the Company.
<TABLE>
<CAPTION>
Principal Director Term
Name (Age) Occupation Since Expires
(**)
<S> <C> <C> <C>
James G. Bagnal, III Senior Vice President of the Company, 1987 1997
(51) President, Chairman of the Board and Chief
Executive Officer of Spartanburg National
Bank(1)
Irvin L. Cauthen President and Owner, Plez-U-Stores 1985 1998
(62) (Convenience Stores), Chairman of the
Board, Travelers Petroleum, Inc. (Gasoline
Sales)(2)
Ronald K. Earnest President and Chief Executive Officer of 1993 1997
(41) Anderson National Bank and Senior Vice
President of the Company(4)
Mason Y. Garrett Chairman of the Board, President and Chief 1984 1997
(53) Executive Officer of the Company,
Chairman of the Board of Anderson
National Bank, and Chairman of the Board
and Chief Executive Officer of Quick
Credit Corporation (5)
*J. Berry Garrett Partner, Garrett & Garrett 1995 1996
(44) (Construction and Real Estate)
*Randolph V. Hayes President, Ralph Hayes Motors (Toyota 1984 1996
(50) Dealer)(6)
J. Donald King, Sr. Businessman (7) 1993 1997
(62)
Roy D. Little President and Director of Quick Credit - -
(47) Corporation (8)
4
<PAGE>
T. Ree McCoy, Jr. President, T. Ree McCoy & Son 1985 1997
(65) (Construction and Real Estate)(9)
G. Weston Nalley Director of Leasing, Nalley Commercial 1990 1997
(32) Properties(10)
Robert V. Pinson Business Manager, Littlejohn Holding 1993 1997
(56) Company (11)
Donald C. Roberts, M.D. Surgeon(12) 1984 1997
(62)
*Harold P. Threlkeld Attorney(13) 1984 1996
(56)
*William B. West Senior Vice President, Chief Financial 1985 1996
(46) Officer, Secretary and Treasurer of the
Company, Executive Vice President and
Cashier of Anderson National Bank,
Cashier of Spartanburg National Bank,
Treasurer of Quick Credit Corporation, and
Cashier of The Community Bank of
Greenville, N.A. (14)
</TABLE>
- ----------------
* Nominee for election to the Board of Directors.
** Years of service on the Board of Directors include prior service on the
Board of Directors of Anderson National Bank (for those persons who are
directors of the Anderson National Bank).
(1) James G. Bagnal, III serves as President, Chief Executive Officer and
Chairman of the Board of Spartanburg National Bank (the "Spartanburg Bank"), and
has served in such capacities since the Spartanburg Bank's formation, and has
been employed by the Company since August 1987, as an organizer of the
Spartanburg Bank. Mr. Bagnal also serves as a director of Quick Credit
Corporation. From 1972 to August 1987, Mr. Bagnal was employed in various
positions with Southern Bank and Trust Company (which was acquired by First
Union Corporation in 1986), most recently as a Senior Vice President in charge
of a three-county area (including Spartanburg County).
(2) Irvin L. Cauthen serves as a director of Anderson National Bank (the
"Anderson Bank"). Mr. Cauthen has served as President and Owner of Plez-U-Store
and Chairman of the Board of Travelers Petroleum, Inc. for the past five years.
(3) Ronald K. Earnest serves as President and Chief Executive Officer of
the Anderson Bank and as Senior Vice President of the Company. From 1990 until
1992, when he was employed by the Anderson Bank, Mr. Earnest was Chief Financial
Officer of Consolidated Glass and Mirror Corporation, Glaxco, Virginia. Prior to
that, from 1989 to 1990, Mr. Earnest was a Vice President and the Area Executive
of First Union National Bank, Mt. Airy, North Carolina.
(4) J. Berry Garrett has served as partner-in-charge of Administration and
leasing for Garrett & Garrett Fountain Inn, South Carolina since 1984. Prior to
becoming a partner in Garrett & Garrett he served as an associate in charge of
administration from 1974 to 1983. Mr. Garrett also serves as a director of The
Community Bank of Greenville.
(5) Mason Y. Garrett has served as President, Chief Executive Officer and
a director of the Company since its organization in November, 1987. Mr. Garrett
served as Chairman of the Board, President, Chief Executive
5
<PAGE>
Officer and director of the Anderson Bank from 1984 to August, 1993 and
presently serves as Chairman of the Board. Mr. Garrett also serves as Chairman
and Chief Executive Officer of Quick Credit Corporation and as a director of the
Spartanburg and Greenville Banks. From September 1983 to March 1984, Mr. Garrett
served as President of Anderson Financial Group, the organizer of the Anderson
Bank. From 1982 to September 1983, Mr. Garrett served as a Senior Vice President
and Regional Executive of Southern Bank and Trust Company. From 1978 to 1982,
Mr. Garrett was President and Chief Executive Officer of Carolina National Bank,
Easley, South Carolina.
(6) Randolph V. Hayes also serves as a director of the Anderson Bank. Mr.
Hayes has served as President of Ralph Hayes Motors for the past five years.
(7) J. Donald King, Sr. also serves as a director of the Anderson Bank.
Mr. King has been a businessman in Anderson for the past five years.
(8) Roy D. Little served as a Senior Executive of World Acceptance
Corporation, a consumer finance company, prior to being employed as President of
Quick Credit Corporation.
(9) T. Ree McCoy, Jr. also serves as a director of the Anderson Bank. Mr.
McCoy has served as President of T. Ree McCoy & Son for the past five years.
(10) G. Weston Nalley serves as a director of the Company. Mr. Nalley has
served as Director of Leasing of Nalley Commercial Properties for the past four
years. Prior to this, Mr. Nalley was in the Officer Training Program of South
Carolina National Bank. Mr. Nalley also serves as a director of the Greenville
Bank.
(11) Robert V. Pinson also serves as a director of the Spartanburg Bank.
Mr. Pinson has served as Business Manager of Littlejohn Holding Company for the
past five years.
(12) Donald C. Roberts, M.D., Retired, also serves as a director of the
Anderson Bank. Prior to his retirement in 1995, Dr. Roberts was a surgeon.
(13) Harold P. Threlkeld also serves as a director of the Anderson Bank.
Mr. Threlkeld has been an attorney for the past five years, practicing as a sole
practitioner.
(14) William B. West also serves as a director of the Anderson Bank and
the Greenville Bank and has served as Executive Vice President and Cashier of
the Anderson Bank since May 1984. From July 1980 to May 1984, Mr. West served as
a Vice President and Cashier of Republic National Bank, Columbia, South
Carolina.
J. Berry Garrett and Mason Y. Garrett are brothers. No other immediate
family relationships exist among the above-named directors or executive officers
of the Company.
The terms of Robert E. DeLapp, Jr. and Milton A. Smith, each of whom has
served as a director since 1987, expire at the 1996 Annual Meeting. The Board of
Directors has elected not to fill one seat and has, therefore, reduced the
number of directors to 13.
Meetings of the Board of Directors and Committees.
The Company
The Board of Directors of the Company held four regular meetings in 1995.
Each director attended at least 75% of the aggregate of (a) the total number of
meetings of the Board of Directors held during the period for which he served as
a director and (b) the total number of meetings held by all committees of the
Board of Directors on which he served. Directors of the Company, except salaried
officers of the Banks, presently receive $3,000 per year in directors' fees.
Members of the Executive Committee and the Compensation Committee, except
salaried officers, presently receive $350 per committee meeting.
6
<PAGE>
The Company has an audit committee consisting of Irvin L. Cauthen, Milton
A. Smith, Robert E. DeLapp, Jr., Robert V. Pinson, Randolph V. Hayes, T. Ree
McCoy, Jr. (Chairman), and Harold P. Threlkeld. The Audit Committee held four
meetings in 1995. The Audit Committee recommends to the Board of Directors the
appointment of the Company's independent auditors and reviews the scope and the
results of the audit by the Company's independent auditors. This committee also
reviews the scope and the results of the audits of the Company's internal audit
department and other matters pertaining to the Company's accounting and
financial reporting functions.
The Company also has an executive committee consisting of Mason Y.
Garrett, James G. Bagnal, III, William B. West, Ronald K. Earnest, Irvin L.
Cauthen and Milton A. Smith. The Executive Committee considers, and makes
recommendations to the Board relating to, major corporate decisions such as
acquisitions, expansion, payment of dividends, and capital offerings. The
Executive Committee met once in 1995.
The Company has a compensation committee consisting of Mason Y. Garrett,
Irvin L. Cauthen and Robert V. Pinson. The Compensation Committee did not meet
in 1995. The Compensation Committee evaluates the performance of the executive
officers of the Company and recommends to the Board of Directors adjustments in
compensation for the executive officers.
At the present time, the Company does not have a standing nominating
committee of the Board of Directors, or committees performing similar functions.
The Banks
Directors of the Anderson Bank and the Spartanburg Bank (other than
directors who also serve as salaried officers) presently receive $3,000 per year
in directors' fees. Directors of the Greenville Bank receive no compensation.
During 1995, the Boards of Directors of each of the Spartanburg Bank and the
Anderson Bank met twelve times.
EXECUTIVE COMPENSATION
Compensation
The following table sets forth the compensation paid by the Company for
the fiscal year ended December 31, 1995, to the chief executive officer of the
Company and other officers of the Company and its subsidiaries whose aggregate
salary and bonus compensation exceeded $100,000.
7
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Number of
Securities
Underlying All Other
Annual Compensation(1) Options Compen-
Name and Principal Position Year Salary Bonus Awarded sation(2)
<S> <C> <C> <C> <C> <C>
Mason Y. Garrett 1995 $105,000 $23,100 -0- $20,511
Chairman of the Board, 1994 95,000 21,519 -0- 16,609
President and Chief Executive 1993 90,000 31,486 -0- 13,326
Officer of the Company;
Chairman of the Board of the
Anderson Bank; Chairman of the
Board and CEO of Quick Credit
Corporation
James G. Bagnal, III 1995 $103,173 $18,600 -0- $12,719
Director, Senior Vice 1994 98,580 13,193 -0- 12,359
President of the Company; 1993 95,680 15,403 -0- 10,756
President, Chairman
of the Board and Chief
Executive Officer of the
Spartanburg Bank; Director
of Quick Credit Corporation
William B. West 1995 $87,862 $23,475 -0- $10,724
Director, Senior Vice 1994 84,053 13,995 -0- 10,172
President and Chief Financial 1993 81,605 14,962 -0- 8,717
Officer, Secretary/Treasurer
of the Company, Director,
Executive Vice President and
Cashier of Anderson Bank,
Cashier of Spartanburg Bank,
Director and Cashier of
Greenville Bank, Director and
Secretary/Treasurer of Quick
Credit Corporation
Roy D. Little 1995 $120,000 $20,000 -0- $570
President and Director of 1994 45,833 -0- $10,000 -0-
Quick Credit Corporation 1993 -0- -0- -0- -0-
Ronald K. Earnest 1995 $93,333 $28,350 -0- $8,595
Director and Senior Vice 1994 87,083 14,696 4,950 $8,183
President of the Company; 1993 81,877 14,522 -0- 5,840
President and Chief Executive
Officer of the Anderson Bank
</TABLE>
- ---------------------
(1) None of the named officers received perquisites or personal benefits
that totaled in excess of the lesser of $50,000 or 10% of their
respective salary plus bonus payments.
(2) All other compensation for 1995 consisted of the following components:
8
<PAGE>
<TABLE>
<CAPTION>
Earnings on Company Contributions
Split-Dollar Deferred to Defined Contribution
Name Life Insurance Compensation Plans(1)
<S> <C> <C> <C>
Mason Y. Garrett $8,660 $7,820 $4,031
James G. Bagnal, III 8,325 757 3,637
Ronald K. Earnest 4,925 305 3,365
William B. West 6,550 1,062 3,112
Roy D. Little -0- 570 -0-
</TABLE>
(1) Comprised of contributions to the Company's 401K Plan as described under
"Employee Benefit Plans -- Employee Savings Plan."
Employee Benefit Plans
Stock Option Plans
On December 14, 1987, the Board of Directors of the Company adopted the
1987 Stock Option Plan, which reserves 178,318 shares of Common Stock for
issuance pursuant to the exercise of options which may be granted pursuant to
the 1987 Stock Option Plan. The shareholders of the Company adopted the 1987
Stock Option Plan in April, 1988. Options under the 1987 Stock Option Plan may
be either "incentive stock options" within the meaning of the Internal Revenue
Code of 1986, as amended (the "Code"), or nonqualified stock options and may be
granted to persons who are employees of the Company or any subsidiary (including
officers and directors who are employees) at the time of grant. All options must
have an exercise price not less than the fair market value of the Common Stock
at the date of grant, as determined by the Board of Directors. The Board of
Directors selects the employees to receive grants under the 1987 Stock Option
Plan and determines the number of shares covered by options granted under the
1987 Stock Option Plan. Options become exercisable in four equal annual
installments, the first installment becoming exercisable one year after the date
of grant. No options may be exercised after ten years from the date of grant,
options may not be transferred except by will or the laws of descent and
distribution, and options may be exercised only while the optionee is an
employee of the Company, within three months after the date of termination of
employment, or within twelve months of death or disability. During 1995, no
stock options were granted to the executive officers or to other employees of
the Company pursuant to the 1987 Stock Option Plan. At December 31, 1995,
options to purchase 176,365 shares were outstanding, 1,953 shares were available
for grant, and 164,346 options were exercisable pursuant to the 1987 Stock
Option Plan. These options have exercise prices ranging from $4.22 per share to
$6.01 per share, with an average exercise price of $5.30 per share and ten-year
terms expiring between December 1997 and April, 2004. During 1995, options to
purchase 13,096 shares were exercised by employees pursuant to the 1987 Stock
Option Plan.
On March 28, 1994, the Board of Directors of the Company adopted the
1994 Stock Option Plan, which reserves 176,513 shares of Common Stock for
issuance pursuant to the exercise of options which may be granted pursuant to
the 1994 Stock Option Plan. On April 26, 1994, the shareholders of the Company
approved the 1994 Stock Option Plan. Options under the 1994 Stock Option Plan
may be either "incentive stock options" within the meaning of the Code, or
nonqualified stock options and may be granted to persons who are employees of
the Company or any subsidiary (including officers and directors who are
employees) at the time of grant. At December 31, 1995, the Company had 188 full
time employees. All options must have an exercise price not less than the fair
market value of the Common Stock at the date of grant, as determined by the
Board of Directors. The Board of Directors may set other terms for the exercise
of the options but may not grant more than $100,000 of options (based on the
fair market value of the optioned shares on the date of the grant of the option)
which first become exercisable in any calendar year. The Board of Directors also
selects the employees to receive grants under the 1994 Stock Option Plan and
determines the number of shares covered by options granted under the 1994 Stock
Option Plan. No options may be exercised after ten years from the date of grant,
options may not be transferred except by will or the laws of descent and
distribution, and options may be exercised only while the optionee is an
employee of the Company, within three months after the date of termination of
employment, or within twelve months of death or disability. The 1994 Stock
Option Plan will terminate on March 28, 2004, and no options will be granted
thereunder
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after that date. Neither the Company nor the recipient of incentive stock
options will have federal income tax consequences from the issuance or exercise
of the options. Recipients of nonqualified options will recognize, as ordinary
income, the difference between the fair market value of the optioned shares on
the date of exercise and the exercise price for federal income tax purposes and
the Company will be able to expense a like amount. Because of the discretion
given to the Board of Directors in selecting the employees to whom grants of
options will be made and the number of options granted, the benefits or amounts
any individual might receive under the 1994 Stock Option Plan are not presently
determinable. During 1995, options to purchase 23,800 shares were granted
pursuant to the 1994 Stock Option Plan. Of such options to purchase shares,
10,500 were granted to executive officers. These options have exercise prices
ranging from $5.50 per share to $10.43 per share, with an average exercise price
of $8.09 per share and have ten year terms expiring between April, 2004 and
April, 2005. During 1995, options to purchase 5,141 shares were exercised by
employees pursuant to the 1994 Stock Option Plan.
The following tables present information about options granted to and
exercised by persons named in the Summary Compensation Table during the year
ended December 31, 1995, and about options held by such persons at December 31,
1995.
OPTION EXERCISES AND YEAR END OPTIONS OUTSTANDING AND VALUES
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Shares Acquired Value Options 12/31/95 Options 12/31/95
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ---- --------------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mason Y. Garrett - - 33,166 -0- $314,745 $ -0-
James G. Bagnal, III - - 22,112 -0- 222,004 -0-
Ronald K. Earnest - - 12,645 7,854 139,761 83,354
Roy D. Little -0- - 2,756 8,269 21,469 128,170
William B. West -0- - 22,112 -0- 222,004 -0-
</TABLE>
Employee Savings Plan
Effective April 1, 1989, the Company adopted a tax deferred savings
plan (the "401K Plan") in accordance with Section 401(k) of the Code, which
covers substantially all of the Company's employees. The 401K Plan provides for
voluntary contributions up to a maximum of 15% per year of any employee's gross
earnings or the maximum permitted by the Code, whichever is less. When a
participant contributes at least 4% of his or her base salary to the 401K Plan,
the Company will match the contribution up to a maximum of 3% of such
participant's base salary. Participants are fully vested in both their
contributions and the Company's contributions at all times. The Company's
contributions to the plan were $91,383 in 1995. Amounts contributed by the
Company pursuant to this plan are included in the cash compensation table above.
Deferred Compensation Plan
Effective January 1, 1989, the Company established a deferred
compensation plan for its directors and certain executive officers whereby the
director/officer may elect to defer fees/salaries until he/she retires. Amounts
deferred under this plan accrue interest at the Anderson Bank's prime rate plus
1% (prime rate minus 1% if the executive officer terminates employment after
less than five years). The deferred compensation plan is funded with life
insurance policies which are payable to the Company in the event of the
employee's death and which will accumulate a cash value equal to the amount of
deferred compensation over time until the employee's retirement. Insurance
premium expense, net of accumulated cash surrender value, was a $3,380 benefit
for the year ended December 31, 1995. Amounts deferred pursuant to this plan are
included in the compensation table above.
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Life Insurance Plans
In December 1988, the Anderson Bank commenced payments on split dollar
life insurance policies on behalf of Mason Y. Garrett and William B. West, and
the Spartanburg Bank commenced payments on a split dollar life insurance policy
on behalf of James G. Bagnal, III. In December, 1992, the Anderson Bank
commenced payments on a split dollar life insurance policy on behalf of Ronald
K. Earnest. In March, 1995, the Community Bank of Greenville, N.A. (In
Organization) commenced payments on a split dollar life insurance policy on
behalf of Frank W. Wingate. The split dollar life insurance policies provide
that, in the event of the insured's death, his named beneficiary will receive
the face amount of the policy, less the amount of premiums paid by the bank
(which is paid to the bank). For Messrs. Garrett, West, Bagnal, Earnest, and
Wingate, the face amount of such policies are $250,000, $240,000, $240,000,
$240,000 and $240,000, respectively. The annual premiums for the policies on
Messrs. Garrett, West, Bagnal, Earnest and Wingate are $8,660, $6,550, $8,325,
$4,925, and $4,381, respectively.
Employment Agreements
The Company has entered into employment agreements with James G.
Bagnal, III, a director of the Company and President of the Spartanburg Bank,
Ronald K. Earnest, a director and Senior Vice President of the Company and
President and Chief Executive Officer of the Anderson Bank, William B. West, a
director and Senior Vice President and Chief Financial Officer of the Company,
and Frank W. Wingate, Senior Vice President of the Company and President and
Chief Executive Officer of The Community Bank of Greenville, N.A. (In
Organization). Each agreement provides that, upon (i) termination by the Company
of such person's employment, other than for cause (as defined in the agreement)
or physical or mental disability, or (ii) termination of employment by such
person because of reduction in salary or benefits, transfer to different
location or different duties, or significant change in status or
responsibilities, then the Company will pay such person an amount ranging from
one to two years salary. The amount is deemed to be severance pay and such
person is not under any duty to mitigate damages in the event of any such
termination. For purposes of determining the amount due such person upon the
occurrence of such an event, the term "salary" will include all direct
compensation plus an amount sufficient for him to obtain medical, disability and
life insurance coverage equivalent to that provided by the Company plus any
amounts contributed to the Company pension plan on his behalf by the Company.
The principal purpose of the agreement is to protect such person against changes
in pay or status resulting from changes in control of the Company as the
consequence of a merger, consolidation or change in voting control of the
Company.
CERTAIN TRANSACTIONS
Certain of the officers, directors and principal shareholders (and
their affiliates) of the Company were customers of, or had transactions with,
the Company or its subsidiaries, including loans in the ordinary course of
business during 1995. All loans or other extensions of credit made by the
Company to officers, directors and principal shareholders of the Company and to
affiliates of such persons were made in the ordinary course of business on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with independent third
parties and did not involve more than the normal risk of collectibility or
present other unfavorable features. As of December 31, 1995, outstanding loans
to officers, directors and principal shareholders of the Company and to
affiliates of such persons totaled approximately $2,894,000. This amount
represented approximately 17.6% of the Company's total shareholders' equity on
that date.
The Company expects to continue to enter into transactions in the
ordinary course of business on similar terms with officers, directors and
principal shareholders (and their affiliates) of the Company.
Harold A. Threlkeld, a director of the Company, is a lawyer and has
provided legal services to the Company and to the Anderson Bank in the past
year. Milton A. Smith, a director of the Company, is a senior partner with the
law firm of Johnson, Smith, Hibbard, Wildman and Dennis, a law firm, which has
also provided legal services to the Company and to the Spartanburg Bank in the
past year. The Company and the Banks expect to continue to use the services of
these persons in the future.
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INDEPENDENT ACCOUNTANTS
The Board of Directors, upon the recommendation of the Audit Committee,
has appointed KPMG Peat Marwick LLP, independent certified public accountants,
as independent auditors for the Company and its subsidiaries for the current
fiscal year ending December 31, 1996, subject to ratification by the
shareholders. KPMG Peat Marwick LLP has served as independent auditors for the
Company and its subsidiaries since April 10, 1991. KPMG Peat Marwick LLP has
advised the Company that neither the firm nor any of its partners has any direct
or material interest in the Company and its subsidiaries except as auditors and
independent certified public accountants of the Company and its subsidiaries.
A representative of KPMG Peat Marwick LLP will be present at the 1996
Annual Meeting and will be given the opportunity to make a statement on behalf
of the firm if he so desires. A representative of KPMG Peat Marwick LLP is also
expected to respond to appropriate questions from shareholders.
All shares represented by valid Proxies received pursuant to this
solicitation and not revoked before they are exercised will be voted in the
manner specified therein. If no specification is made, the Proxies will be voted
for the ratification of the appointment of KPMG Peat Marwick LLP for the fiscal
year ending December 31, 1996.
AVAILABILITY OF ANNUAL REPORT ON FORM 10-K
The Company, upon request and without charge, will provide shareholders
with copies of its Annual Report on Form 10-K for the year ended December 31,
1995 filed with the Securities and Exchange Commission. Shareholders should
direct their requests to: First United Bancorporation, 304 North Main Street,
Anderson, South Carolina 29621, attention: Cynthia Reaber.
OTHER BUSINESS
The Board of Directors of the Company does not know of any other
business to be presented at the Annual Meeting. If any other matters are
properly brought before the Annual Meeting, however, it is the intention of the
persons named in the accompanying proxy to vote such proxy in accordance with
their best judgment.
By Order of the Board of Directors
Mason Y. Garrett
President
Anderson, South Carolina
April 4, 1996
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APPENDIX - FORM OF PROXY
PROXY
FIRST UNITED BANCORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS - TUESDAY, APRIL 23, 1996
Mason Y. Garrett and James G. Bagnal, III, or either of them, with full
power of substitution, are hereby appointed as agent(s) of the undersigned to
vote as proxies all of the shares of Common Stock of First United Bancorporation
held of record by the undersigned on the Record Date at the Annual Meeting of
Shareholders to be held on April 23, 1996, and at any adjournment thereof, as
follows:
1. ELECTION OF FOR all nominees listed WITHHOLD AUTHORITY
DIRECTORS. below (except any I have to vote for all
written below) [ ] nominees listed
below [ ]
[ ] WITHHOLD AUTHORITY on the following nominees only
J. Berry Garrett, Randolph V. Hayes, Harold P. Threlkeld, William B. West
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL(S) WRITE THE
NOMINEE'S(S') NAME(S) ON THE LINE BELOW.
2. PROPOSAL TO RATIFY APPOINTMENT OF KPMG PEAT MARWICK, CERTIFIED PUBLIC
ACCOUNTANTS, AS THE COMPANY'S INDEPENDENT AUDITORS FOR 1996.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. And, in the discretion of said agents, upon such other business as may
properly come before the meeting, and matters incidental to the conduct of
the meeting. (Management at present knows of no other business to be
brought before the meeting.)
THE PROXIES WILL BE VOTED AS INSTRUCTED. IF NO CHOICE IS INDICATED WITH RESPECT
TO A MATTER WHERE A CHOICE IS PROVIDED, THIS PROXY WILL BE VOTED "FOR" SUCH
MATTER.
Please sign exactly as name appears below. When signing as attorney, executor,
administrator, trustee, or guardian, please give full title. If more than one
trustee, all should sign. All joint owners must sign.
Dated: , 1996 ___________________________
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