<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
BEACH FIRST NATIONAL BANCSHARES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
BEACH FIRST NATIONAL BANCSHARES, INC.
1550 NORTH OAK STREET
MYRTLE BEACH, SOUTH CAROLINA 29577
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
Dear Fellow Shareholder:
We cordially invite you to attend the 1999 Annual Meeting of
Shareholders of Beach First National Bancshares, Inc., the holding company for
Beach First National Bank. At the meeting, we will report on our performance in
1998 and answer your questions. We are excited about our accomplishments in
1998 and look forward to discussing both our accomplishments and our plans with
you. We hope that you can attend the meeting and look forward to seeing you
there.
This letter serves as your official notice that we will hold the
meeting on April 21, 1999 at 2:00 p.m. at the Myrtle Beach Convention Center,
2101 North Oak Street, Myrtle Beach, South Carolina 29577, for the following
purpose:
1. To elect five members to the Board of Directors; and
2. To transact any other business that may properly come before
the meeting or any adjournment of the meeting.
Shareholders owning our common stock at the close of business on March
12, 1999 are entitled to attend and vote at the meeting. A complete list of
these shareholders will be available at the Company's offices prior to the
meeting. In addition to the specific matters to be acted upon, there also will
be a report on the operations of the Company, and directors and officers of the
Company will be present to respond to your questions.
Please use this opportunity to take part in the affairs of your
Company by voting on the business to come before this meeting. Even if you plan
to attend the meeting, we encourage you to complete and return the enclosed
proxy to us as promptly as possible.
By Order of the Board of Directors,
/s/ Raymond E. Cleary, III
Raymond E. Cleary, III
Chairman and Chief Executive Officer
March 26, 1999
Myrtle Beach, South Carolina
<PAGE> 3
BEACH FIRST NATIONAL BANCSHARES, INC.
1550 NORTH OAK STREET
MYRTLE BEACH, SOUTH CAROLINA 29577
PROXY STATEMENT FOR ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON APRIL 21, 1999
Our Board of Directors is soliciting proxies for the 1999 Annual
Meeting of Shareholders. This proxy statement contains important information
for you to consider when deciding how to vote on the matters brought before the
meeting. We encourage you to read it carefully.
VOTING INFORMATION
The Board set March 12, 1999 as the record date for the meeting.
Shareholders owning our common stock at the close of business on that date are
entitled to attend and vote at the meeting, with each share entitled to one
vote. There were 735,868 shares of common stock outstanding on the record date.
A majority of the outstanding shares of common stock represented at the meeting
will constitute a quorum.
When you sign the proxy card, you appoint William Gary Horn and
Raymond E. Cleary, III as your representatives at the meeting. Mr. Horn and Dr.
Cleary will vote your proxy as you have instructed them on the proxy card. If
you submit a proxy but do not specify how you would like it to be voted, Mr.
Horn and Dr. Cleary will vote your proxy for the election to the Board of
Directors of all nominees listed below under "Election Of Directors." We are
not aware of any other matters to be considered at the meeting. However, if any
other matters come before the meeting, Mr. Horn and Dr. Cleary will vote your
proxy on such matters in accordance with their judgment.
You may revoke your proxy and change your vote at any time before the
polls close at the meeting. You may do this by signing and delivering another
proxy with a later date or by voting in person at the meeting.
We are paying for the costs of preparing and mailing the proxy
materials and of reimbursing brokers and others for their expenses of
forwarding copies of the proxy materials to our shareholders. Our officers and
employees may assist in soliciting proxies but will not receive additional
compensation for doing so. We are distributing this proxy statement on or about
March 26, 1999.
PROPOSAL NO. 1: ELECTION OF DIRECTORS
The Board of Directors is divided into three classes with staggered
terms, so that the terms of only approximately one-third of the Board members
expire at each annual meeting. The current terms of the Class I directors will
expire at the meeting. The terms of the Class II directors expire at the 2000
Annual Shareholders Meeting. The terms of the Class III directors will expire
at the 2001 Annual Shareholders Meeting. Our directors and their classes are:
<TABLE>
<CAPTION>
Class I Class II Class III
<S> <C> <C>
Raymond E. Cleary, III Michael Bert Anderson Vernie E. Dove
William Gary Horn Orvis Bartlett Buie Jack L. Green, Jr.
Joe N. Jarrett, Jr. Michael D. Harrington Samuel Robert Spann, Jr.
Richard E. Lester Diane W. Sammons B. Larkin Spivey, Jr.
Don J. Smith Rick H. Seagroves James C. Yahnis
</TABLE>
<PAGE> 4
Shareholders will elect five nominees as Class I directors at the
meeting to serve a three-year term, expiring at the 2002 Annual Meeting of
Shareholders. The directors will be elected by a plurality of the votes cast at
the meeting. This means that the five nominees receiving the highest number of
votes will be elected. Abstentions and broker non-votes will not be considered
to be either affirmative or negative votes.
The Board of Directors recommends that you elect Dr. Raymond E.
Cleary, III, William Gary Horn, Dr. Joe N. Jarrett, Jr., Richard E. Lester, and
Don J. Smith as Class I directors.
If you submit a proxy but do not specify how you would like it to be
voted, Dr. Cleary and Mr. Horn will vote your proxy to elect Dr. Cleary, Mr.
Horn, Dr. Jarrett, Mr. Lester, and Mr. Smith. If any of these nominees is
unable or fails to accept nomination or election (which we do not anticipate),
Dr. Cleary and Mr. Horn will vote instead for a replacement to be recommended
by the Board of Directors, unless you specifically instruct otherwise in the
proxy.
Set forth below is certain information about the nominees, each of
whom has been a director of the Company since the Company's formation in 1995:
Dr. Raymond E. Cleary III, age 50, is Chairman and Chief Executive
Officer of the Company. Dr. Cleary has been a practicing general dentist in
Surfside Beach, South Carolina since 1975. As a dentist, he served as an
officer/board member of the South Carolina Dental Association, 4th District of
South Carolina Dental Association, and the Grand Strand Dental Society. Dr.
Cleary is also a board member of the Florence Darlington Technical College,
Dental Hygienist/Assistant Program. He received his undergraduate degree and
his dental degree from the Ohio State University and College of Dentistry. In
business, Dr. Cleary was an initial organizer and director of Waccamaw State
Bank from 1980-1987. In 1987, Waccamaw State Bank merged into Anchor Bank, and
he was an advisory director of Anchor Bank from 1987-1994. In the community,
Dr. Cleary has served as a Webelo Boy Scout leader and a youth soccer coach. He
has been an officer or board member of the Grand Strand YMCA, the South Strand
Sertoma, the Grand Strand Soccer Association, the Surfside Business and
Professional Association, the Better Business Bureau, and the Myrtle Beach
Chamber of Commerce. Additionally, Dr. Cleary has served as an Eucharistic
Minister, in a church men's group, and on a church board.
William Gary Horn, age 49, is President and Chief Executive Officer of
Beach First National Bank, President of the Company, and a director of the
Company and the Bank. He received a bachelor of science degree in 1973 from
Georgia Southern University. He received an advanced banking degree from the
Stonier Graduate School of Banking, Rutgers University, in 1986. In addition,
he attended the Georgia State University Credit School in 1977, the OMEGA
Program for Commercial Lending in 1980, and the Georgia School of Banking at
the University of Georgia in 1981. Mr. Horn has over 23 years of experience in
the commercial banking industry, the last eight years of which have been in
community banking. From 1989 to 1992, Mr. Horn was employed by Embry National
Bank, Atlanta, Georgia, as Senior Vice President and Senior Loan Officer. He
was in charge of lending and implemented a loan documentation quality
monitoring system. From 1993 to until he joined the Bank in 1995, he was the
Executive Vice President and Senior Loan Officer at Summerville National Bank,
Summerville, South Carolina. He was responsible for managing the bank's entire
loan portfolio and developing products and business for the bank. Mr. Horn is
currently a member of the Chicora Rotary Club in Myrtle Beach and the Sertoma
Club of Myrtle Beach.
Dr. Joe N. Jarrett, Jr., age 50, is a director of the Company and the
Bank. Dr. Jarrett is a Board Certified Orthopedic Surgeon. Dr. Jarrett is the
president of the board of directors of the Tara Hall Home for Boys and is a
member and past president of the Grand Strand Sertoma Club. Dr. Jarrett has
been extremely active serving the medical community. He is the past president
of the South Carolina Orthopedic Association and has previously served as
president of the Horry County Medical Society. Dr. Jarrett is a member of the
Grand Strand Regional Medical Center Board of Trustees. He received his
bachelor's degree in English from Dartmouth College and his doctorate of
medicine from West Virginia University.
Richard E. Lester, age 55, is a director of the Company and the Bank
and is a Chief Municipal Judge for the City of Myrtle Beach. In addition to his
capacity as Chief Municipal Judge, Judge Lester practices real estate law.
Judge Lester is also a member of the Horry County Bar Association, the South
Carolina Bar Association, and the American Bar Association. He received his
bachelor's degree in 1966 and his juris doctorate degree in 1969 from the
2
<PAGE> 5
University of South Carolina. He was admitted to the South Carolina Bar in
1969. From 1969 to 1973, Judge Lester was an agent with the Federal Bureau of
Investigation.
Don J. Smith, age 48, is a director of the Company and the Bank. Mr.
Smith is vice president of marketing for Chicora Development, a real estate
firm in the Myrtle Beach and Grand Strand areas. He is currently a member of
the Planning and Zoning Board for the Town of Briarcliffe Acres and a member of
the King of Glory Lutheran Church. He is also a member and has served on
various committees of the Myrtle Beach Chamber of Commerce. Mr. Smith has been
a member of the South Carolina Association of Realtors and the Horry County
Board of Realtors for more than 20 years and also serves as a director for each
of those organizations. He holds a bachelor's degree in accounting from Western
Carolina University.
Set forth below is also information about each of the Company's other
directors and each of its executive officers. Each of the following directors
has been a director of the Company since the Company's formation in 1995, with
the exception of Vernie E. Dove who became a director in January 1998. Each
director is also a director of Beach First National Bank.
Vernie E. Dove, age 63, is a director of the Company and the Bank. He
attended the University of North Carolina and is currently Executive Vice
President of Associated Insurors, Inc.. He chairs the South Carolina Center for
Family Policy, is president of the Myrtle Beach Rotary Club, and is a board
member of the Myrtle Beach Chamber of Commerce. Dove serves on the advisory
board of Santee Cooper and is past president of the Board of Vistors at
Presbyterian College.
Dr. Jack L. Green, Jr., age 54, is a director of the Company and the
Bank and has been a practicing orthodontist in Myrtle Beach for the past 20
years. He is a graduate of Clemson University and the Medical College of
Virginia and has earned a master's degree from Fairleigh Dickenson University.
Dr. Green formerly served as president of the Grand Strand Dental Society and
president of the South Carolina Association of Orthodontists. Dr. Green is a
former member of the advisory board for NationsBank and a member of the First
Presbyterian Church.
Samuel Robert Spann, Jr., age 50, is a director of the Company and the
Bank and has served as president and CEO of Spann Inc. since 1975. Spann Inc.
is a large regional roofing contractor serving the eastern sectors of South
Carolina and North Carolina. Mr. Spann currently serves as a member on the
Board of Visitors at the Wall School of Business, Coastal Carolina University.
He is also a director on the board of the National Roofing Contractors
Association and has been a past president of the Carolina Roofing Association.
Mr. Spann's extensive community involvement in the past includes service as
president and general campaign chairman of the United Way of Horry County, as
well as service on the board of directors of the Myrtle Beach Rotary Club, the
Dunes Golf and Beach Club, and the Myrtle Beach Area Chamber of Commerce. Mr.
Spann is a graduate of Clemson University and has served proudly as an officer
in the United States Air Force.
B. Larkin Spivey, Jr., age 58, is a director of the Company and the
Bank. He has been president and general manager of Birch Canoe Campground, Inc.
since 1985, operating a Kampgrounds of America ("KOA") franchised camping
resort with an ancillary convenience store and recreational vehicle sales
business. Since 1986, he has been the manager of Spivey Company, LLC, managing
commercial real estate in Myrtle Beach and Conway, South Carolina. He served
for 20 years as an officer in the United States Marine Corps, commanding
various units including an infantry company in combat during the Vietnam War.
Mr. Spivey is a director and recent past president of the Myrtle Beach
Campground Owners Association and a past director of the Myrtle Beach Area
Hospitality Association. He served from 1982 to 1995 on the local advisory
board of C&S National Bank and its successor, NationsBank. Mr. Spivey graduated
from The Citadel with a degree in business administration in 1961 and received
a master's degree in business administration from George Washington University
in 1972. He is currently a member of Trinity Episcopal Church and the Cursillo
of Christianity Secretariat, Diocese of South Carolina.
James C. Yahnis, age 43, is a director of the Company and the Bank. He
is currently president of Chris Yahnis Coastal, Inc., a beer wholesale company
in Myrtle Beach. Mr. Yahnis holds the MAI designation, and he is associated
with The Hazen Company, a real estate appraisal firm. Mr. Yahnis serves on the
Board of Directors at Wachesaw Plantation. He has formerly served on various
professional committees for The Appraisal Institute. He
3
<PAGE> 6
received a bachelor's degree in economics from Davidson College and a master's
degree in real estate from the University of Florida.
Michael Bert Anderson, age 39, is a director of the Company and the
Bank. He is a native of the Myrtle Beach area. He graduated from Duke
University in 1980 with a degree in management sciences/accounting. Mr.
Anderson returned home after college to work in the family hotel business. The
business has tripled in size since 1980. Mr. Anderson is the managing owner of
the Poindexter Ocean Front Resort and helps to manage four other Anderson
family-owned properties. Mr. Anderson's community activities range from being
the lay leader at the First United Methodist Church in Myrtle Beach to working
at every level of the Horry County United Way drive. He is a member of the
local Rotary Club (a Paul Harris fellow). Mr. Anderson has served on the Myrtle
Beach area Hospitality Association and is currently retiring as the president
of the 400-member trade organization. As a volunteer for the City of Myrtle
Beach, Mr. Anderson serves on the Myrtle Beach Accommodations Tax Advisory
Committee, having just completed a four-year term as a member and vice-chairman
of the Myrtle Beach Planning and Zoning Board.
Orvis Bartlett Buie, age 50, is a director of the Company and the
Bank. He is the owner of Bartlett Buie, CPA, P.A. From 1992 until September
1997, Mr. Buie was a partner with Buie, Rabon & Jaskot, CPAs. Prior to 1992,
Mr. Buie was a partner with Bates, Buie, Lindsay, Evans, Rabon & Kinard, CPAs.
He is the president of Damon's Eastern Carolina, Ltd., the franchiser of
Damon's Ribs restaurants in North Carolina, South Carolina, and eastern
Tennessee. Mr. Buie received his bachelor's degree in accounting from the
University of South Carolina in 1972. He has been a certified public accountant
since 1974 and is licensed to practice in both South Carolina and North
Carolina.
Michael D. Harrington, age 51, is a director of the Company and the
Bank. He is president and general manager of Harrington Construction Company,
Inc., a Myrtle Beach general contracting firm organized in 1979. With over 30
years of construction experience, Mr. Harrington specializes in commercial
construction in the Myrtle Beach and Grand Strand area. Originally from Sumter,
South Carolina, he served six years in the United States Marine Corps Reserves
immediately following high school. Presently, he serves on the Horry County
Advisory Council of Junior Achievement and as a board member of Myrtle Beach
Haven, a homeless shelter. Mr. Harrington served on the advisory board for
United Carolina Bank for three years. In addition, he is a member of Myrtle
Beach Masonic Lodge #353, Myrtle Beach Shrine Club, Omar Temple, Delta Lodge of
Perfection, and Myrtle Beach Elks Lodge #771.
Diane W. Sammons, age 50, is a director of the Company and the Bank.
She is a native of Horry County, has owned and operated Fully's Restaurant for
ten years, and recently opened Droopy's Sports Bar. She was formerly a branch
coordinator and commercial lending officer with South Carolina National Bank
for nine years. During her employment with South Carolina National Bank, Ms.
Sammons received her certificate from the American Institute of Banking and
attended the South Carolina Bankers School. In 1974, Ms. Sammons was named
Myrtle Beach Young Career Woman. During 1989, she served on the Myrtle Beach
Area Council. In the community, Ms. Sammons has been actively involved with
youth athletics and children's homes. She received her bachelor's degree from
the University of South Carolina, where she was an active member of the Beta
Sigma Phi Sorority.
Rick H. Seagroves, age 42, is a director of the Company and the Bank.
He is the owner and chief executive officer of Inland Foods Corporation, which
operates 17 Burger King restaurants located in the southeast portion of South
Carolina. He also owns TKS, Inc., which operates several of The Sea Store
convenience store/gas stations and is a franchisee with T.G.I. Friday's
restaurant group. Mr. Seagroves is an elder at the First Presbyterian Church
and a member of the Budget and Stewardship Committee. He is a member of the
Grand Strand Sertoma Club. Mr. Seagroves works with several charities in the
Myrtle Beach area and has been instrumental in raising special project funds
for Horry County schools.
4
<PAGE> 7
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table shows the cash compensation paid by the Company or
Beach First National Bank to its President for the years ended December 31,
1996 through 1998. No executive officers of the Company or Beach First National
Bank earned total annual compensation, including salary and bonus, in excess of
$100,000 in 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation(1)
--------------------------------------------------------------
Other Annual
Name and Principal Position Year Salary Bonus Compensation
- --------------------------- ---- ------ ----- ------------
<S> <C> <C> <C> <C>
William Gary Horn 1998 $ 94,500 $ 0 $ 0
President of Beach First
National Bank 1997 $ 90,000 $ 4,000 $ 0
1996 $103,750 $ 0 $ 0
</TABLE>
(1) Executive officers of the Company also received indirect compensation in
the form of certain perquisites and other personal benefits. The amount of
such benefits received in the fiscal year by the named executive officer
did not exceed 10% of the executive's annual salary and bonus.
EMPLOYMENT AGREEMENTS
William Gary Horn and the Company entered into an employment agreement
pursuant to which Mr. Horn serves as the President and Chief Executive Officer
of the Bank. In addition, Mr. Horn was elected as the President of the Company
in March 1997. The employment agreement provided for a starting salary of
$75,000 per annum until the date the subscription proceeds were released from
escrow and $90,000 per annum thereafter. Mr. Horn is also eligible to receive a
cash bonus equal to 5% of the net pre-tax income of the Bank (determined in
accordance with generally accepted accounting principles) if the Bank achieves
certain performance levels established by the Board of Directors from time to
time. Mr. Horn has also been granted an option to purchase 36,793 shares of
common stock, exercisable at $10.00 per share. The options vest at the rate of
one-fifth per year for each of the first five anniversaries of the opening date
of the Bank, subject to Mr. Horn's being employed by the Company on such date
and meeting certain performance criteria. The options have a term of ten years.
Additionally, Mr. Horn participates in the Bank's retirement, welfare, and
other benefit programs and is entitled to a life insurance policy and
reimbursement for automobile expenses, club dues, and travel and business
expenses.
The employment agreement provides for an initial term ending on
September 23, 2001. On the last day of the employment agreement and on the
anniversary of such date for each year thereafter, the term of the employment
agreement shall be automatically extended for one additional year without
further action by the parties unless, prior to such last day, either party
shall serve written notice upon the other of its intention that the employment
agreement shall not be so extended.
In addition, the employment agreement provides that after a change in
control, Mr. Horn has the option by providing written notice to the Company
within 30 days of the change in control of: (i) automatically extending the
term of the employment agreement for a term commencing on the date of the
change in control and ending on the date which is one year and six months from
the date thereof or (ii) receiving, within 15 days of his notice, any sums due
him under the employment agreement plus severance compensation payable in one
lump sum payment in an amount equal to one and one-half times his then-current
annual base salary. Furthermore, in the event of a change in control,
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<PAGE> 8
the Company must remove any restrictions on outstanding incentive awards,
including the options, so that all such awards vest immediately.
For a period of two years following the date of termination, Mr. Horn
may not (a) be employed in the banking business as a director, officer, or
organizer, or promoter of, or consultant to, or acquire more than a 1% passive
investment in, any financial institution in Horry County, South Carolina, (b)
solicit customers of the Company or its affiliates for the purpose of providing
financial services, or (c) solicit employees of the Company or its affiliates
for employment.
AGGREGATED OPTION EXERCISE AND YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Unexercised Securities Value of Unexercised In-the-Money
Underlying Options at Fiscal year End (#) Options at Fiscal Year End ($)(1)
----------------------------------------- ----------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
William Gary Horn 14,718 22,075 $ 22,077 $ 33,113
</TABLE>
- -------------------------------------
(1) The price of the last trade of which the Company is aware prior to
December 31, 1998 was $11.50. Therefore, the value of unexercised
in-the-money options is based on a fair market value of the common
stock of $11.50.
DIRECTOR COMPENSATION
Neither the Company nor the Bank paid directors' fees during the last
fiscal year.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
GENERAL
The following table shows how much common stock in the Company is
owned by the directors, its executive officers, and owners of more than 5% of
the outstanding common stock, as of December 31, 1998.
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF BENEFICIAL
NAME SHARES OWNED (1) RIGHT TO ACQUIRE (2) OWNERSHIP (3)
---- ---------------- -------------------- ---------------
<S> <C> <C> <C>
Michael Bert Anderson 14,650 1,500 2.19%
Orvis Bartlett Buie 14,300 1,500 2.14%
Raymond E. Cleary III 21,225 1,500 3.08%
Vernie E. Dove 100 1,500 .22%
Jack L. Green, Jr. 14,000 1,500 2.10%
Michael D. Harrington 16,200 1,500 2.40%
William Gary Horn 5,000 14,718 2.67%
Joe N. Jarrett, Jr. 14,270 1,500 2.14%
Richard E. Lester 13,980 1,500 2.09%
Diane W. Sammons 14,200 1,500 2.12%
Rick H. Seagroves 14,000 1,500 2.10%
</TABLE>
6
<PAGE> 9
<TABLE>
<S> <C> <C> <C>
Don J. Smith 14,000 1,500 2.10%
Samuel Robert Spann, Jr. 15,500 1,500 2.30%
B. Larkin Spivey, Jr. 14,000 1,500 2.10%
James C. Yahnis 14,000 1,500 2.10%
Executive officers and directors as a 199,425 35,718 30.5%
group (15 persons)
</TABLE>
- ---------------------------------
(1) Includes shares for which the named person:
- has sole voting and investment power,
- has shared voting and investment power with a spouse, or
- holds in an IRA or other retirement plan program, unless
otherwise indicated in these footnotes.
Does not include shares that may be acquired by exercising stock
options.
(2) Includes shares that may be acquired within the next 60 days by
exercising vested stock options but does not include any other stock
options.
(3) Determined by assuming the named person exercises all options which he
or she has the right to acquire within 60 days, but that no other
persons exercise any options.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the year ended December 31, 1998, the Board of Directors of the
Company held one meeting and the Board of Directors of Beach First National
Bank held 12 meetings. All of the directors of the Company and Beach First
National Bank attended at least 75% of the aggregate of such board meetings and
the meetings of each committee on which they served except for Diane Sammons.
The Company's Board of Directors has appointed a number of committees,
including an audit committee and a human resource committee. The audit
committee is composed of the following five members: B. Larkin Spivey, Jr.,
Michael Bert Anderson, Rick H. Seagroves, James C. Yahnis, and Samuel Robert
Spann, Jr. The audit committee met one time in 1998. The audit committee has
the responsibility of reviewing the Company's financial statements, evaluating
internal accounting controls, reviewing reports of regulatory authorities, and
determining that all audits and examinations required by law are performed. The
committee recommends to the Board the appointment of the independent auditors
for the next fiscal year, reviews and approves the auditor's audit plans, and
reviews with the independent auditors the results of the audit and management's
responses. The audit committee is responsible for overseeing the entire audit
function and appraising the effectiveness of internal and external audit
efforts. The audit committee reports its findings to the Board of Directors.
The Company's human resource committee is responsible for establishing
the compensation plans for the Company and Beach First National Bank. Its
duties include the development with management of all benefit plans for
employees of the Company and Beach First National Bank, the formulation of
bonus plans, incentive compensation packages, and medical and other benefit
plans. This committee met one time during the year ended December 31, 1998. The
human resource committee is composed of the following five members: Orvis
Bartlett Buie, Michael D. Harrington, Vernie E. Dove, Dr. Joe N. Jarrett, Jr.,
and Don J. Smith.
The Company does not have a nominating committee or a committee
serving a similar function.
7
<PAGE> 10
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
INTERESTS OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
The Company and Beach First National Bank have banking and other
transactions in the ordinary course of business with directors and officers of
the Company and Beach First National Bank and their affiliates. It is the
Company's policy that these transactions be on substantially the same terms
(including price, or interest rates and collateral) as those prevailing at the
time for comparable transactions with unrelated parties. The Company does not
expect these transactions to involve more than the normal risk of
collectibility nor present other unfavorable features to the Company or Beach
First National Bank. Loans to individual directors and officers must also
comply with Beach First National Bank's lending policies and statutory lending
limits, and directors with a personal interest in any loan application are
excluded from the consideration of the loan application. The Company intends
for all of its transactions with its affiliates to be on terms no less
favorable to the Company than could be obtained from an unaffiliated third
party and to be approved by a majority of disinterested directors.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
As required by Section 16(a) of the Securities Exchange Act of 1934,
the Company directors, its executive officers, and certain individuals are
required to report periodically their ownership of the Company's common stock
and any changes in ownership to the SEC. Based on a review of Forms 3, 4, and 5
and any representations made to the Company, it appears that all such reports
for these persons were filed in a timely fashion during 1998, except that
Michael D. Harrington failed to file a Form 4 in connection with transactions
executed during 1998; these delinquencies were corrected on this director's
Form 5.
INDEPENDENT AUDITORS
The Company has selected the firm of Elliott, Davis & Company, L.L.P.
to serve as the independent auditors to the Company for the year ending
December 31, 1999. The Company does not expect a representation from this firm
to attend the annual meeting.
SHAREHOLDER PROPOSALS FOR THE 2000 ANNUAL MEETING OF SHAREHOLDERS
If shareholders wish a proposal to be included in the Company's proxy
statement and form of proxy relating to the 2000 annual meeting, they must
deliver a written copy of their proposal to the principal executive offices of
the Company no later than November 27, 1999. To ensure prompt receipt by the
Company, the proposal should be sent certified mail, return receipt requested.
Proposals must comply with the Company's bylaws relating to shareholder
proposals in order to be included in the Company's proxy materials.
March 26, 1999
8
<PAGE> 11
PROXY SOLICITED FOR ANNUAL MEETING OF SHAREHOLDERS OF
BEACH FIRST NATIONAL BANCSHARES, INC.
TO BE HELD ON APRIL 21, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby constitutes and appoints Dr. Raymond E. Cleary, III
and William Gary Horn, and each of them, his or her true and lawful agents and
proxies with full power of substitution in each, to represent and vote, as
indicated below, all of the shares of common stock of Beach First National
Bancshares, Inc. that the undersigned would be entitled to vote at the Annual
Meeting of Shareholders of the Company to be held at the Myrtle Beach Convention
Center, 2101 North Oak Street, Myrtle Beach, South Carolina 29577 on Wednesday,
April 21, 1999 at 2:00 p.m. local time, and at any adjournment, upon the matters
described in the accompanying Notice of Annual Meeting of Shareholders and Proxy
Statement, receipt of which is acknowledged. These proxies are directed to vote
on the matters described in the Notice of Annual Meeting of Shareholders and
Proxy Statement as follows:
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED: "FOR" PROPOSAL NO. 1 TO ELECT THE FIVE IDENTIFIED CLASS I DIRECTORS TO
SERVE ON THE BOARD OF DIRECTORS EACH FOR THREE-YEAR TERMS.
1. PROPOSAL to elect the five identified Class I directors to serve for three
year terms.
<TABLE>
<S> <C> <C>
Raymond E. Cleary, III, William Gary Horn, Joe N. Jarrett, Jr.,
Richard E. Lester, Don J. Smith
[ ] FOR all nominees listed [ ]
(except as marked to the contrary)
<CAPTION>
<S> <C>
Raymond E. Cleary, III, William Gary Horn, Joe N. Jarrett,
Jr., Richard E. Lester, Don J. Smith
[ ] WITHHOLD AUTHORITY
to vote for all nominees
</TABLE>
(INSTRUCTION: To withhold authority to vote for any individual nominee(s), write
that nominee's name(s) in the space provided below.)
- --------------------------------------------------------------------------------
Dated: , 1999
------------------
-------------------------------
Signature of Shareholder(s)
-------------------------------
Please Print Name
-------------------------------
Signature of Shareholder(s)
-------------------------------
Please Print Name
Please sign exactly as name or
names appear on your stock
certificate. Where more than
one owner is shown on your
stock certificate, each owner
should sign. Persons signing in
a fiduciary or representative
capacity shall give full title.
If a corporation, please sign
in full corporate name by
authorized officer. If a
partnership, please sign in
partnership name by authorized
person.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE.
