<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] 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 (S)240.14a-11(c) or (S)240.14a-12
FIRST PALMETTO FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
FIRST PALMETTO FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
-----------------------------------------------------------------------
(4) Date Filed:
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Notes:
<PAGE>
January 26, 1998
Dear Stockholder:
It is our pleasure to invite you to attend the Annual Meeting of
Stockholders of First Palmetto Financial Corporation ("First Palmetto"), the
holding company for First Palmetto Savings Bank, F.S.B. (the "Bank"). The
Annual Meeting will be held at the Bank's main office, 407 DeKalb Street,
Camden, South Carolina, on Monday, February 23, 1998 at 10:00 a.m., local time.
Notice of the Annual Meeting, together with a Proxy Statement and Proxy
Card, are enclosed and describe in detail the formal business we will conduct.
As an integral part of the Annual Meeting, we will report on First Palmetto's
and the Bank's operations. Our directors and officers will, of course, be
available for your questions.
Detailed information concerning our business activities and operating
results through September 30, 1997 is contained in our Annual Report, which is
enclosed.
Your vote is important, regardless of the number of shares you own. ON
BEHALF OF THE BOARD OF DIRECTORS, WE URGE YOU TO SIGN, DATE AND RETURN THE
ENCLOSED PROXY CARD AS SOON AS POSSIBLE EVEN IF YOU CURRENTLY PLAN TO ATTEND THE
ANNUAL MEETING. This will not prevent you from voting in person but will assure
that your vote is counted if you are unable to attend the Annual Meeting.
Thank you for your cooperation and continuing support.
Sincerely,
Samuel R. Small
President and Chief Executive Officer
<PAGE>
FIRST PALMETTO FINANCIAL CORPORATION
407 DEKALB STREET
CAMDEN, SOUTH CAROLINA 29020
(803) 432-2265
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY 23, 1998
- --------------------------------------------------------------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting") of First Palmetto Financial Corporation ("First Palmetto"), the
holding company for First Palmetto Savings Bank, F.S.B. (the "Bank"), will be
held at the Bank's main office, 407 DeKalb Street, Camden, South Carolina, on
Monday, February 23, 1998, at 10:00 a.m., local time, for the following
purposes:
1. The election of four directors of First Palmetto.
2. Such other matters as may properly come before the Annual Meeting or
any adjournments thereof.
NOTE: The Board of Directors is not aware of any other business to come
before the Annual Meeting.
Pursuant to the Bylaws, the Board of Directors has fixed the close of business
on January 23, 1998 as the record date for the determination of stockholders
entitled to notice of and to vote at the Annual Meeting. Only holders of common
stock of record at the close of business on that date will be entitled to notice
of and to vote at the Annual Meeting or any adjournments thereof.
In the event there are not sufficient votes to approve any one or more of the
foregoing proposals at the time of the Annual Meeting, the Annual Meeting may be
adjourned in order to permit further solicitation of proxies by First Palmetto.
You are requested to complete and sign the enclosed Proxy Card, which is
solicited by the Board of Directors, and to mail it promptly in the enclosed
envelope. Your proxy will not be used if you attend and vote at the Annual
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
DARLENE H. LOVE
SECRETARY
Camden, South Carolina
January 26, 1998
- --------------------------------------------------------------------------------
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE FIRST PALMETTO THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. AN ADDRESSED ENVELOPE
IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES.
- --------------------------------------------------------------------------------
<PAGE>
FIRST PALMETTO FINANCIAL CORPORATION
407 DEKALB STREET
CAMDEN, SOUTH CAROLINA 29020
(803) 432-2265
- --------------------------------------------------------------------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 23, 1998
- --------------------------------------------------------------------------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of First Palmetto Financial Corporation
("First Palmetto"), the holding company for First Palmetto Savings Bank, F.S.B.
(the "Bank"), to be used at the Annual Meeting of Stockholders of First Palmetto
(the "Annual Meeting") to be held at the Bank's main office, 407 DeKalb Street,
Camden, South Carolina, on Monday, February 23, 1998, at 10:00 a.m., local time.
It is anticipated that this Proxy Statement will be mailed to stockholders on or
about January 26, 1998.
If the enclosed form of proxy is properly executed and returned to First
Palmetto in time to be voted at the Annual Meeting, the shares represented
thereby will be voted in accordance with the instructions marked thereon.
EXECUTED BUT UNMARKED PROXIES WILL BE VOTED FOR THE ELECTION OF THE FOUR
NOMINEES OF FIRST PALMETTO'S BOARD OF DIRECTORS AS DIRECTORS. Proxies marked as
abstentions will not be counted as votes cast. In addition, shares held in
street name which have been designated by brokers on proxy cards as not voted
will not be counted as votes cast. Proxies marked as abstentions or as broker
no votes, however, will be treated as shares present for purposes of determining
whether a quorum is present. Except for procedural matters incidental to the
conduct of the Annual Meeting, First Palmetto does not know of any other matters
that are to come before the Annual Meeting. If any other matters are properly
brought before the Annual Meeting, the persons named in the accompanying proxy
will vote the shares represented by such proxies on such matters as determined
by a majority of the Board of Directors.
The securities which can be voted at the Annual Meeting consist of shares
of common stock of First Palmetto, par value $0.01 per share (the "Common
Stock"). Each share entitles its owner to one vote on all matters, including
the election of directors. The close of business on January 23, 1998 has been
fixed by the Board of Directors as the record date for determination of
stockholders entitled to vote at the Annual Meeting (the "Record Date"). The
number of shares outstanding on that date was 708,010. The presence, in person
or by proxy, of one-third of the total number of outstanding shares of Common
Stock is necessary to constitute a quorum at the Annual Meeting.
- --------------------------------------------------------------------------------
REVOCATION OF PROXIES
- --------------------------------------------------------------------------------
The presence of a stockholder at the Annual Meeting will not automatically
revoke such stockholder's proxy. However, stockholders may revoke a proxy at any
time prior to its exercise by filing with the Secretary of First Palmetto a
written notice of revocation, by delivering to First Palmetto a duly executed
proxy bearing a later date or by attending the Annual Meeting and voting in
person.
<PAGE>
- --------------------------------------------------------------------------------
STOCK OWNERSHIP OF MANAGEMENT
- --------------------------------------------------------------------------------
The following table sets forth information as of the Record Date with
respect to the shares of Common Stock beneficially owned by each director and
director emeritus of First Palmetto, including the Chief Executive Officer, and
by all directors, executive officers and directors emeritus of First Palmetto as
a group. This information is based on information furnished to First Palmetto
by such persons.
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENT OF
OF BENEFICIAL COMMON STOCK
OWNERSHIP (1) OUTSTANDING
------------------ -------------
<S> <C> <C>
Directors:
H. Davis Green, Jr. 28,281 3.99%
Samuel R. Small 81,660 11.53
Steve G. Williams, Jr. 30,579 4.32
Pierce W. Cantey, Jr. 25,274 3.57
William R. Clyburn 6,500 .92
James L. Creed 32,566 4.60
Frank D. Goodale, Jr. 6,140 .87
Donald H. Holland 11,300 1.60
Charlie E. Nash 14,221 2.01
Glenn G. Tucker 55,387 7.82
All Directors and Executive Officers
as a Group (10 persons) 291,908 41.23
Directors Emeritus:
Austin Sheheen, Sr. 921 .13
H.B. Marshall, Jr. 2,500 .35
William F. Tripp, Jr. 2,500 .35
All Directors, Executive Officers
and Directors Emeritus as a Group (13 persons) 297,829 42.06
</TABLE>
______________
(1) In accordance with Rule 13d-3 under the Securities Exchange Act of 1934, a
person is considered the beneficial owner of any shares of Common Stock
(a) over which he has or shares voting or investment power or (b) of which
he has the right to acquire beneficial ownership at any time within 60 days
of the Record Date. As used herein, "voting power" is the power to vote or
direct the vote of shares, and "investment power" is the power to dispose
or direct the disposition of shares. This table includes shares owned
directly by directors and officers of First Palmetto as well as shares held
by their spouses and minor children and trusts of which certain of them are
trustees, but does not include shares held or beneficially owned by other
relatives as to which they disclaim beneficial ownership.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING
Section 16(a) of the Securities Exchange Act of 1934 requires First
Palmetto's officers and directors, and persons who own more than 10% of a
registered class of First Palmetto's equity securities, to file reports of
2
<PAGE>
ownership and changes in ownership with the Securities and Exchange Commission.
Officers, directors and greater than 10% stockholders are required to furnish
First Palmetto with copies of all such reports. Based solely on its review of
copies of such reports received by it, or written representations from certain
reporting persons that no annual report of change in beneficial ownership is
required, First Palmetto believes that, during the year ended September 30,
1997, all such filing requirements were complied with.
- --------------------------------------------------------------------------------
PRINCIPAL HOLDERS OF COMMON STOCK
- --------------------------------------------------------------------------------
The following table sets forth information as of the Record Date with
respect to the persons believed by First Palmetto to be the beneficial owners of
more than five percent of the outstanding shares of Common Stock. This
information is based upon the most recent Schedule 13D filed by such persons
with the Securities and Exchange Commission or information provided to First
Palmetto by such persons.
<TABLE>
<CAPTION>
PERCENT
NAME AND ADDRESS AMOUNT AND NATURE OF OF COMMON STOCK
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP (1) OUTSTANDING
- ------------------------ ------------------------ ----------------
<S> <C> <C>
Samuel R. Small 81,660 11.53%
407 DeKalb Street
Camden, South Carolina
Glenn G. Tucker 55,387 7.82%
1510 Lyttleton Street
Camden, South Carolina
</TABLE>
______________
(1) For the definition of beneficial ownership and additional information with
respect to the nature of the beneficial ownership, see footnote (1) to the
table in "Stock Ownership of Management."
- --------------------------------------------------------------------------------
ELECTION OF DIRECTORS
- --------------------------------------------------------------------------------
Pursuant to First Palmetto's Certificate of Incorporation, the directors
are divided into three classes, as nearly equal in number as possible, with the
number of directors as specified in the Bylaws. In general, the term of office
of only one class of directors expires in each year, and their successors are
elected for terms of three years and until their successors are elected and
qualified. Delaware law provides that directors shall be elected by a plurality
of the votes of the shares present in person or represented by proxy at the
Annual Meeting and entitled to vote on the election of directors.
The Board of Directors has nominated H. Davis Green, Jr., Steve G.
Williams, Jr., Donald H. Holland and Glenn G. Tucker, who are currently
directors of First Palmetto (see below), to serve for terms of three years and
until their successors are elected and qualified. It is the intention of the
persons named in the proxy to vote the shares represented by each properly
executed proxy for the election as directors of such nominees for their
respective terms, unless otherwise directed by the stockholder. The nominees
have consented to stand for election and to serve if elected as directors. If
any person nominated by the Board of Directors fails to stand for election or is
unable to accept election, the proxies will be voted for the election of such
other person as the Board of Directors may recommend.
3
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE ELECTION
OF THE NOMINEES OF THE BOARD OF DIRECTORS. Unless otherwise indicated, properly
executed proxies will be voted in accordance with the Board's recommendation.
INFORMATION AS TO DIRECTORS, DIRECTORS EMERITUS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to First
Palmetto's directors and executive officers.
<TABLE>
<CAPTION>
YEAR FIRST YEAR
ELECTED TERM
NAME AGE(1) POSITION(S) HELD DIRECTOR(2) EXPIRES
- ---- ------ ----------------------------- ------------- -------
<S> <C> <C> <C> <C>
H. Davis Green, Jr. 60 Chairman of the Board 1970 1998
of First Palmetto
Samuel R. Small 50 President and Chief Executive 1980 1999
Officer of First Palmetto and
Chairman of the Board, President
and Chief Executive Officer of
the Bank
Steve G. Williams, Jr. 41 Senior Vice President and 1989 1998
Treasurer of First Palmetto
and Senior Vice President
Regulatory Administration/
Communications of the Bank
Pierce W. Cantey, Jr. 56 Director 1996 2000
William R. Clyburn 61 Director 1968 2000
James L. Creed 72 Director 1970 2000
Frank D. Goodale, Jr. 64 Director 1979 1999
Donald H. Holland 69 Director 1971 1998
Charlie E. Nash 56 Director 1983 1999
Glenn G. Tucker 48 Director 1980 1998
</TABLE>
- ----------------
(1) As of December 31, 1997.
(2) Except for Mr. Cantey, year first elected as a director of Palmetto State
Savings Bank of South Carolina ("Palmetto State") or First Federal Savings
and Loan Association of Camden ("First Federal"), the predecessors of the
Bank, which is First Palmetto's wholly-owned subsidiary. Each director of
First Palmetto is also a director of the Bank.
4
<PAGE>
The principal occupations and business experience for the past five years
of each director, director emeritus and executive officer of First Palmetto is
set forth below.
DIRECTORS:
- ----------
H. DAVIS GREEN, JR. is an appraiser and the owner of H. Davis Green, Jr.
Appraisals in Camden. Mr. Green has been Chairman of the Board of First
Palmetto since October 1991. Previously, he had been Vice Chairman of the Board
of First Palmetto since First Federal merged with First Palmetto in October
1990. Prior to that, he served at various times as President, Chief Executive
Officer and Chairman of the Board of First Federal.
SAMUEL R. SMALL has been President and Chief Executive Officer of First
Palmetto and Chief Executive Officer of the Bank since October 1990. In October
1991, he became Chairman of the Board of the Bank. Previously, he had served as
Vice Chairman of the Board of the Bank. Prior to the merger of First Federal
and Palmetto State, Mr. Small served at various times as Executive Vice
President, President, Chief Operating Officer and Chief Executive Officer of
First Federal.
STEVE G. WILLIAMS, JR. has been Senior Vice President and Treasurer of
First Palmetto and an executive officer of the Bank since October 1990.
Previously, Mr. Williams served at various times as Treasurer of First Palmetto
and Vice President, Senior Vice President and Treasurer of Palmetto State.
PIERCE W. CANTEY, JR. is the managing partner of Carswell, Cantey, Burch
and Associates, LLP, an accounting firm.
WILLIAM R. CLYBURN is the retired general manager of H&H Chevrolet. He is
President of Bill Clyburn Realty, Inc.
JAMES L. CREED is retired. Previously, he was employed by D.J. Creed,
Inc., a timber company in Camden.
FRANK D. GOODALE, JR. is a jeweler and owner of F.D. Goodale, a jewelry
retailer in Camden.
DONALD H. HOLLAND is a partner in the law firm of Holland, DuBose and
Cushman in Camden. He has served as a South Carolina State Senator since 1969.
CHARLIE E. NASH is the President of Charlie E. Nash Insurance Agency, Inc.
in Camden.
GLENN G. TUCKER has been President of Tucker Down East Resources, Inc., a
recreational services provider, since January 1996. Prior to that, he was the
co-publisher of the Chronicle - Independent in Camden.
DIRECTORS EMERITUS:
- -------------------
H.B. MARSHALL, JR. is self-employed by a life insurance company affiliated
with the New York Life Insurance Company.
AUSTIN SHEHEEN, SR. is a retired business executive. Previously, Mr.
Sheheen was President of Sheheen Texaco, Inc., a petroleum distributorship in
Camden.
WILLIAM F. TRIPP, JR. is a retired plant manager of the E.I. DuPont de
Nemours Textile Fibers Plant in Camden.
5
<PAGE>
- --------------------------------------------------------------------------------
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
- --------------------------------------------------------------------------------
First Palmetto's entire Board of Directors serves as a nominating committee
for the purpose of selecting the Board's nominees for election as directors.
The Board of Directors held one meeting as a nominating committee during fiscal
1997. While the Board of Directors will consider nominees recommended by
stockholders, it has not actively solicited recommendations from First
Palmetto's stockholders for nominees, nor has it established any procedures for
this purpose other than as set forth in the Certificate of Incorporation. To be
timely, a stockholder's notice must be delivered to or mailed and received at
the principal executive office of First Palmetto not later than the close of
business on the 15th day following the date on which notice is mailed or prior
public disclosure is made of the date of an annual meeting. Public disclosure
of the date of the Annual Meeting was made by the issuance of a press release on
December 26, 1997. A stockholder's notice of nomination must also set forth
certain information specified in First Palmetto's Certificate of Incorporation
concerning the nominating stockholder and each person the stockholder proposes
to nominate for election. Stockholder nominations may be made by any
stockholder eligible to vote at an annual meeting, provided the notice of
nomination is timely and complies with the informational requirements of the
Certificate of Incorporation. Nominations by any stockholder eligible to vote
at the Annual Meeting are required to be received by First Palmetto on or before
January 10, 1998.
There are no standing committees of the Board of Directors of First
Palmetto. The Board of Directors of the Bank carries out many of its duties
through committees.
The Bank's Audit Committee, currently composed of directors Cantey, Creed,
Holland and Nash, is responsible for the review and evaluation of First
Palmetto's and the Bank's internal controls and accounting procedures. It also
periodically reviews audit reports with the independent auditors and recommends
the annual appointment of such auditors. The Audit Committee held one meeting
during fiscal 1997.
The Bank's Compensation Committee, currently composed of directors Green,
Holland, Nash and Tucker held two meetings during fiscal 1997.
During fiscal 1997, First Palmetto's Board of Directors held six meetings
and the Bank's Board of Directors held 12 meetings. No director of First
Palmetto and the Bank attended fewer than 75% of the total meetings of the
boards of directors and committees on which such director served during this
period.
6
<PAGE>
- --------------------------------------------------------------------------------
EXECUTIVE COMPENSATION
- --------------------------------------------------------------------------------
The following table sets forth cash and noncash compensation awarded to
or earned by the Chief Executive Officer of First Palmetto during fiscal 1997,
1996 and 1995.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
-----------------------------------------------------------------------------------------------------------------
ANNUAL COMPENSATION LONG-TERM COMPENSATION
--------------------------- ---------------------------------------------------
AWARDS PAYOUTS
--------------------------- -------
OTHER
ANNUAL RESTRICTED SECURITIES ALL OTHER
COMPEN- STOCK UNDERLYING LTIP COMPEN-
NAME AND SALARY BONUS SATION (2) AWARDS(S) OPTIONS/SARS PAYOUTS SATION (3)
PRINCIPAL POSITION (1) YEAR ($) ($) ($) ($) (#) ($) ($)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Samuel R. Small 1997 167,667 -- -- -- -- (4) -- 8,400
President and Chief 1996 160,000 -- -- -- -- -- 8,400
Executive Officer 1995 120,000 5,800 -- -- -- -- 6,000
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) No other executive officer earned in excess of $100,000 in salary and bonus
in fiscal 1997, 1996 and 1995.
(2) Executive officers of First Palmetto receive indirect compensation in the
form of certain perquisites and other personal benefits. The amount of
such benefits in fiscal 1997, 1996 and 1995 by the named executive officer
did not exceed 10% of the executive's annual salary and bonus.
(3) Represents directors fees for each of fiscal 1997, 1996 and 1995.
(4) No options were granted or outstanding during fiscal 1997.
DIRECTORS' COMPENSATION
During fiscal 1997, each director of the Bank received an annual fee of
$8,400. Non-employee directors also receive a fee of $100 per committee meeting
attended.
REPORT OF THE COMPENSATION COMMITTEE
As members of the Compensation Committee of the Bank, it is our duty to
review compensation policies applicable to executive officers; to consider the
relationship of corporate performance to that compensation; to recommend salary
and bonus levels for executive officers for consideration by the Board of
Directors of the Bank; and to administer various incentive plans of First
Palmetto and the Bank.
Overview. Under the compensation policies of the Bank, which are endorsed
by the Compensation Committee, compensation is paid based both on the executive
officer's performance and the performance of First Palmetto and the Bank. In
assessing the performance of First Palmetto and the Bank for purposes of
compensation decisions, the Compensation Committee considers a number of
factors, including profits of First Palmetto and the Bank during the past year
relative to their profit plans, changes in the value of First Palmetto's stock,
reports of federal regulatory examinations of First Palmetto and the Bank,
growth, business plans for future periods, and
7
<PAGE>
regulatory capital levels. The Compensation Committee assesses individual
executive performance based upon its determination of the officer's
contributions to the performance of First Palmetto and the Bank and the
accomplishment of First Palmetto's and the Bank's strategic goals. In assessing
performance for the year ended September 30, 1997 and previous years, the
members of the Committee did not make use of a mechanical weighting formula or
use specific performance targets, but instead weighed the described factors as
they deemed appropriate in the total circumstances.
Base Salary. The 1997 salary levels of First Palmetto's senior officers
were established in 1996 consistent with this compensation policy. In its 1996
review of base compensation, the Committee determined that the performance of
Mr. Small in managing First Palmetto and the Bank was satisfactory, based upon
the 1996 financial performance of First Palmetto, including the growth in
assets, income, and capitalization during 1996; the financial performance trends
for 1996 and the preceding four years, which included growth in assets, net
income, and stockholders' equity in each year; the results of confidential
regulatory examinations; his continued involvement in community affairs in the
communities served by the Bank; First Palmetto's planned levels of financial
performance for 1997; and a general level of satisfaction with the management of
First Palmetto and the Bank. Based upon the results of this review, the salary
of Mr. Small was established at $182,000 per year for 1997, which represented an
increase of 13.8% over his 1996 base salary.
No member of the Compensation Committee is a former or current officer or
employee of First Palmetto or the Bank.
January 16, 1998
H. Davis Green
Donald H. Holland
Charlie E. Nash
Glenn G. Tucker
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Donald H. Holland, a member of the Compensation Committee, is a partner in
the law firm of Holland, DuBose and Cushman, Camden, South Carolina, which
renders legal services to the Bank in connection with loan closings and other
corporate matters. Aggregate fees paid by the Bank to such firm for the year
ended September 30, 1997 were $124,093.
8
<PAGE>
STOCK PERFORMANCE COMPARISONS
The following graph shows the cumulative total return on the Common Stock
of First Palmetto over the last five years, compared with the S & P 500 Index
and a portfolio of all publicly traded thrifts and thrift holding companies.
Cumulative total return on the stock or the index equals the total increase in
value since September 30, 1992 assuming reinvestment of all dividends paid into
the stock or the index, respectively. The graph was prepared assuming that $100
was invested on September 30, 1992 in the Common Stock, and the securities
included in the indexes. There is not an established public trading market for
the Common Stock.
CUMULATIVE TOTAL STOCKHOLDER RETURN
COMPARED WITH PERFORMANCE OF SELECTED INDEXES
SEPTEMBER 30, 1992 THROUGH SEPTEMBER 30, 1997
[LINE GRAPH APPEARS HERE]
First Palmetto Financial Corporation
<TABLE>
<CAPTION>
Period Ending
---------------------------------------------------------------------
Index 9/30/92 9/30/93 9/30/94 9/30/95 9/30/96 9/30/97
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
First Palmetto Financial Corporation 100.00 116.32 159.24 164.45 210.74 268.56
S&P 500 100.00 113.00 117.17 152.02 182.92 256.71
Thrifts(A11) 100.00 155.52 170.54 223.33 269.74 468.70
</TABLE>
Source: SNL Securities LC (804) 977-1600
Charlottesville, VA 22902
9
<PAGE>
CERTAIN TRANSACTIONS
First Palmetto and the Bank have had, and expect to have in the future,
transactions in the ordinary course of business with directors and executive
officers and members of their immediate families, as well as with principal
stockholders. All loans included in such transactions were made in the ordinary
course of business, on substantially the same terms, including interest rates
and collateral, as those prevailing for comparable transactions with non-
affiliated persons. It is the belief of management that such loans neither
involved more than the normal risk of collectibility nor presented other
unfavorable features.
- --------------------------------------------------------------------------------
INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
The Board of Directors expects to appoint KPMG Peat Marwick LLP to audit
First Palmetto's financial statements for the fiscal year ending September 30,
1998. KPMG Peat Marwick LLP served as First Palmetto's independent auditors for
the year ended September 30, 1997 and has served as First Palmetto's independent
auditors since 1991. A representative of KPMG Peat Marwick LLP is expected to
be present at the Annual Meeting. He will be available to respond to
appropriate questions and will have the opportunity to make a statement if he
desires to do so.
- --------------------------------------------------------------------------------
MISCELLANEOUS
- --------------------------------------------------------------------------------
The cost of soliciting proxies in the form enclosed herewith will be borne
by First Palmetto. In addition to solicitation of proxies by mail, First
Palmetto, through its directors, officers and regular employees, may also
solicit proxies personally or by telegraph or telephone without additional
compensation. First Palmetto will request persons, firms and corporations
holding shares in their names or in the names of their nominees, which are
beneficially owned by others, to send proxy materials to and obtain proxies from
such beneficial owners and will reimburse such holders for their reasonable
expenses in doing so.
- --------------------------------------------------------------------------------
STOCKHOLDER PROPOSALS
- --------------------------------------------------------------------------------
Any proposal intended to be presented by any stockholder for action at next
year's Annual Meeting of Stockholders of First Palmetto must be received by the
Secretary of First Palmetto at First Palmetto's main office, 407 DeKalb Street,
Camden, South Carolina 29020 not later than September 28, 1998 in order for the
proposal to be considered for inclusion in the proxy materials relating to that
Annual Meeting. In addition, First Palmetto's Certificate of Incorporation
provides that due notice of business to be bought before an annual meeting by a
stockholder must be delivered to the principal executive offices of First
Palmetto neither fewer than 30 nor more than 90 days prior to the meeting,
unless notice or prior public disclosure of the date of the meeting occurs fewer
than 45 days prior to the date of the meeting, in which event the Certificate of
Incorporation provides that due notice of business to be brought before the
meeting by a stockholder must be delivered not later than the close of business
on the 15th day following the day on which notice of the day of the meeting was
mailed or public disclosure was made. Nothing in this paragraph shall be deemed
to require First Palmetto to include in its proxy materials any stockholder
proposal which does not meet all of the requirements for inclusion established
by the Securities and Exchange Commission or First Palmetto's Certificate of
Incorporation or Bylaws in effect at the time such proposal is received.
10
<PAGE>
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FINANCIAL INFORMATION
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A copy of First Palmetto's Annual Report to Stockholders for fiscal 1997
accompanies this Proxy Statement. FIRST PALMETTO HAS FILED AN ANNUAL REPORT ON
FORM 10-K FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1997 WITH THE SECURITIES AND
EXCHANGE COMMISSION. STOCKHOLDERS MAY OBTAIN, FREE OF CHARGE, A COPY OF SUCH
REPORT ON FORM 10-K BY WRITING TO THE SECRETARY OF FIRST PALMETTO AT POST OFFICE
BOX 861, CAMDEN, SOUTH CAROLINA 29020.
BY ORDER OF THE BOARD OF DIRECTORS
DARLENE H. LOVE
SECRETARY
Camden, South Carolina
January 26, 1998
11
<PAGE>
REVOCABLE PROXY
FIRST PALMETTO FINANCIAL CORPORATION
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ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 23, 1998
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The undersigned hereby constitutes and appoints Samuel R. Small and Charlie
E. Nash, and each of them, the proxies of the undersigned, with full power of
substitution, to attend the Annual Meeting of Stockholders (the "Annual
Meeting") of First Palmetto Financial Corporation ("First Palmetto"), the
holding company for First Palmetto Savings Bank, F.S.B. (the "Bank"), to be held
at the Bank's main office, 407 DeKalb Street, Camden, South Carolina, on Monday,
February 23, 1998, at 10:00 a.m., local time, and at any adjournments thereof,
and to vote all the shares of stock of First Palmetto which the undersigned may
be entitled to vote, upon the following matters:
FOR WITHHOLD
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I. The election as directors of the nominees
listed below. [_] [_]
H. Davis Green, Jr.
Steve G. Williams, Jr.
Donald H. Holland
Glenn G. Tucker
INSTRUCTION: TO WITHHOLD
YOUR VOTE FOR ANY NOMINEE(S), WRITE
THAT NOMINEE'S NAME ON THE LINE BELOW.
---------------------------------------
II. The transaction of such other business as may properly come before the
Annual Meeting or any adjournments thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ELECTION OF THE NOMINEES
LISTED ABOVE.
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THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS MARKED HEREIN. IF
NO INSTRUCTIONS TO THE CONTRARY ARE MARKED HEREIN, THIS PROXY WILL BE VOTED FOR
THE ELECTION AS DIRECTORS OF THE NOMINEES LISTED ABOVE AND AS DETERMINED BY A
MAJORITY OF THE BOARD OF DIRECTORS AS TO OTHER MATTERS.
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<PAGE>
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned stockholder hereby acknowledges receipt of a copy of the
accompanying Notice of Annual Meeting of Stockholders and Proxy Statement and
hereby revokes any proxy or proxies heretofore given. This proxy may be revoked
at any time prior to its exercise.
Dated: ___________________, 1998
____________________________ _____________________________________
PRINT NAME OF STOCKHOLDER PRINT NAME OF STOCKHOLDER
____________________________ _____________________________________
SIGNATURE OF STOCKHOLDER SIGNATURE OF STOCKHOLDER
PLEASE SIGN EXACTLY AS YOUR NAME APPEARS ON THE ENCLOSED CARD. When signing as
attorney, executor, administrator, trustee or guardian, etc., please give your
full title. If the signer is a corporation, please sign the full name by a duly
appointed officer. If shares are held jointly, each holder should sign.
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PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE.
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