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
(X) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
FOUR OAKS FINCORP, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than 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:
FOUR OAKS FINCORP, INC.
April 5, 1999
Dear Shareholder:
Accompanying this letter please find the Notice of Annual Meeting, Proxy
Statement, Annual Report and proxy for Four Oaks Fincorp, Inc.'s Annual Meeting.
It is extremely important for you to complete, sign, date, and return the
enclosed proxy as soon as possible even if you plan to attend the meeting in
person. If you do attend, you can revoke your proxy and vote in person.
The Annual Meeting will begin at 8:00 p.m. on Monday, April 26, 1999, at
the main office of Four Oaks Bank & Trust Company, located at 6144 US 301 South,
Four Oaks, North Carolina.
At the Annual Meeting, the Shareholders will elect the Board of Directors
for the coming year, and transact any other business properly brought before the
meeting.
Hope to see you at the Annual Meeting, and please remember to complete,
sign, and date the enclosed proxy and return it to Branch Bank & Trust in the
envelope provided as soon as possible.
Sincerely yours,
/s/ Ayden R. Lee, Jr.
--------------------
Ayden R. Lee, Jr.
Chief Executive Officer and President
Enclosures
----------
6144 US 301 South
Four Oaks, NC 27524
(919)963-2177
FAX (919)963-2768
FOUR OAKS FINCORP, INC.
6144 US 301 South
Four Oaks, North Carolina 27524
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 26, 1999
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You are cordially invited to attend the Annual Meeting of Shareholders
of Four Oaks Fincorp, Inc. which will be held on Monday, April 26, 1999 at 8:00
p.m., local time, at the main office of Four Oaks Fincorp, Inc., located at 6144
US 301 South, Four Oaks, North Carolina, for the following purposes:
(1) To elect the persons listed in the accompanying Proxy
Statement dated April 5, 1999 to the Board of Directors of Four Oaks Fincorp,
Inc.; and
(2) To transact such other business as may properly come before
the meeting or any adjournments thereof.
Shareholders of record at the close of business on March 8, 1999
are entitled to notice of and to vote at the Annual Meeting and any and all
adjournments thereof.
IT IS DESIRABLE THAT YOUR SHARES OF STOCK BE REPRESENTED AT THE MEETING
REGARDLESS OF THE NUMBER OF SHARES YOU MAY HOLD. EVEN THOUGH YOU MAY PLAN TO
ATTEND THE MEETING IN PERSON, PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY IN
THE ENVELOPE PROVIDED. IF YOU ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND
VOTE IN PERSON.
By Order of the Board of Directors
/s/ Ayden R. Lee, Jr.
Ayden R. Lee, Jr.
Chief Executive Officer and
President
April 5, 1999
FOUR OAKS FINCORP, INC.
6144 US 301 SOUTH
FOUR OAKS, NORTH CAROLINA 27524
PROXY STATEMENT
This Proxy Statement, accompanying proxy card, Notice of Annual Meeting
of Shareholders and the Annual Report are being furnished to shareholders on or
about April 5, 1999 by the Board of Directors of Four Oaks Fincorp, Inc. (the
"Company") in connection with the solicitation of proxies for use at the Annual
Meeting of Shareholders (the "Annual Meeting") to be held at the main office of
the Company, located at 6144 US 301 South, Four Oaks, North Carolina on Monday,
April 26, 1999 at 8:00 p.m., local time, and at all adjournments thereof. All
expenses incurred in connection with this solicitation will be paid by the
Company. In addition to solicitation by mail, certain officers, directors, and
regular employees of the Company, who will receive no additional compensation
for their services, may solicit proxies by telephone, personal communication, or
other means.
ANNUAL MEETING
PURPOSES OF THE ANNUAL MEETING
The principal purposes of the Annual Meeting are: (1) to elect seven
nominees to the Company's Board of Directors and (2) to transact such other
business as may properly come before the Annual Meeting or any adjournments
thereof. The Board of Directors knows of no matters other than those stated
above to be brought before the Annual Meeting or any adjournments thereof.
Nonetheless, the proxyholders named on the enclosed proxy card may vote in
accordance with the instructions of the Board of Directors or in the absence
thereof, in accordance with their discretion, on any other matter properly
presented for action of which the Board of Directors is not now aware.
PROXIES
Any proxy given pursuant to this solicitation may be revoked by the
person giving it at any time before it is exercised. Proxies may be revoked by
filing with the Secretary of the Company written notice of revocation, by duly
executing a subsequent proxy and filing it with the Secretary of the Company
before the revoked proxy is exercised, or by attending the Annual Meeting and
voting in person. If the proxy card is signed and returned, but voting
directions are not made, the proxy will be voted in favor of the proposals set
forth in the accompanying "Notice of Annual Meeting of Shareholders."
RECORD DATE
The Board of Directors has fixed the close of business on March 8, 1999
as the record date for determination of shareholders entitled to receive notice
of and to vote at the Annual Meeting and all adjournments thereof. As of the
close of business on March 8, 1999, the Company had outstanding 1,349,039 shares
of Common Stock, the holders of which, or their proxies, are entitled to one
vote per share.
VOTING RIGHTS
Except as otherwise provided by law, each holder of Common Stock has one
vote per share upon all matters voted upon by shareholders. The North Carolina
Business Corporation Act provides that with respect to the election of
directors, cumulative voting is not available to shareholders of the Company.
2
SECURITY OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information as of March 8, 1999
regarding shares of Common Stock of the Company beneficially owned by (i) each
director, (ii) director nominee, (iii) each executive officer named in the
Summary Compensation Table in this Proxy Statement, and (iv) all directors and
executive officers as a group. Except as otherwise indicated, the persons listed
below have sole voting and investment power with respect to all shares of Common
Stock owned by them, except to the extent that such power may be shared with a
spouse. Fractional share amounts are rounded off to the nearest whole number.
NAME OF
BENEFICIAL OWNER SHARES OWNED(1) PERCENT OF CLASS (1)
---------------- --------------- --------------------
Harold J. Sturdivant (2) 77,192 5.7%
M.S. Canaday (3) 54,448 4.0
Ayden R. Lee, Jr. (4) 35,943 2.2
Paula Canaday Bowman 25,779 1.9
William J. Edwards 6,453 *
Warren L. Grimes (5) 3,945 *
Percy Y. Lee (6) 10,663 *
All Directors and Executive
Officers as a Group (11
persons) (7) 227,886 16.9%
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*Less than 1%
(1) Based upon 1,349,039 shares of Common Stock outstanding on March 8,
1999. The securities "beneficially owned" by an individual are
determined in accordance with the definition of "beneficial ownership"
set forth in the regulations of the Securities and Exchange Commission.
Accordingly, they may include securities owned by or for, among others,
the spouse and/or minor children of the individual and any other
relative who resides in the home of such individual, as well as other
securities as to which the individual has or shares voting or investment
power or has the right to acquire under outstanding stock options within
60 days of March 8, 1999. Beneficial ownership may be disclaimed as to
certain of the securities.
(2) Includes 68,033 shares (5.0%) owned by Josephine L. Sturdivant (spouse -
residing at 5426 Hampton Road Fayetteville, North Carolina 28311) who
has sole voting and investment power with respect to these shares, 798
shares owned jointly with spouse and 450 shares subject to stock options
which are exercisable within 60 days.
(3) Includes 7,749 shares owned by spouse who has sole voting and investment
power with respect to these shares and 450 shares subject to stock
options which are exercisable within 60 days.
(4) Includes 8,124 shares owned by spouse who has sole voting and investment
power with respect to these shares, 133 shares owned by Mr. Lee's son
and 6,000 shares subject to stock options which are exercisable within
60 days.
(5) Includes 2,107 shares owned jointly with spouse, 446 owned by spouse who
has sole voting and investment power with respect to these shares and
450 shares subject to stock options which are exercisable within 60
days.
(6) Includes 7,560 shares owned jointly with spouse and 450 shares subject
to stock options which are exercisable within 60 days.
(7) Includes 9,000 shares subject to stock options which are exercisable
within 60 days by non-director executive officers.
3
The following table sets forth certain information as of March 8, 1999
regarding any person who is known to the Company to be the beneficial owner of
more than five percent of the Company's Common Stock (except as set forth in the
table above relating to the Company's directors and executive officers).
NAME AND ADDRESS OF AMOUNT AND NATURE OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS
William Ashley Turner and Debra 69,293 5.1%
C. Turner, Joint Tenants with
right of survivorship
2256 Shotwell Road
Clayton, North Carolina 27520
4
ELECTION OF DIRECTORS
The nominees for the election of directors are named and certain other
information is provided in the following tabulation.
YEAR FIRST POSITIONS AND OFFICES WITH COMPANY & BUSINESS
NAME AGE ELECTED EXPERIENCE DURING PAST FIVE YEARS
M.S. Canaday 75 1969 Chairman of the Board of Directors of the
Company and Four Oaks Bank & Trust Company (the
"Bank"); Owner of Four Oaks Drug Co.
Ayden R. Lee, Jr. 50 1983 Chief Executive Officer, President, and
Director of the Company and the Bank
Harold J. Sturdivant 71 1989 Director of the Company and the Bank; Past
Chairman of the Compensation Committee of the
Company; Former Director and Treasurer of
Sturdivant Supply, Inc.
Paula Canaday Bowman 50 1989 Director of the Company and the Bank
William J. Edwards 55 1990 Director of the Company and the Bank;
President, Chief Executive Officer and
Chairman of the Board of Four Oaks IGA
Foodliner, Inc. and Secretary of Edwards IGA
Percy Y. Lee 58 1992 Director of the Company and the Bank; Member
of Clayton Area Advisory Board of the Bank;
President of T.R. Lee Oil Co.; Senior Partner
of Lee Brother's Rental; Partner in Lee &
Dupree, a rental real estate partnership
Warren L. Grimes 50 1992 Director of the Company and the Bank; General
Partner in Reedy Creek Direct Marketing
Association; Solid Waste Division Manager for
Johnston County; Former Vice President of
Finance for Davis Communications Group, Inc.
dba Broadcast Services; Former President of
Trash Collection Service, Inc.; Chairman of
the Company's Compensation Committee
5
The number constituting the Board of Directors shall be not less than
five nor more than twenty-one. The number of directors within this variable
range may be fixed or changed from time to time by the shareholders or the Board
of Directors. The Board of Directors has set the number of directors at seven.
The members of the Board of Directors are elected by the shareholders of the
Company to serve one year terms.
All directors and executive officers hold office until the next Annual
Meeting or until their successors are elected and qualified. The Board of
Directors has no reason to believe that the persons named above as nominees for
directors will be unable or will decline to serve if elected. However, in the
event of death or disqualification of any nominee or refusal or inability of any
nominee to serve, it is the intention of the proxyholders to vote for the
election of such other person or persons as the proxyholders determine in their
discretion; but in no circumstance will the proxy be voted for more than seven
nominees. Properly executed and returned proxies, unless revoked, will be voted
as directed by the shareholder or, in the absence of such direction, will be
voted in favor of the election of the recommended nominees.
Pursuant to North Carolina law, the seven candidates who receive the
highest number of votes will be elected as directors of the Company. Abstentions
and broker non-votes are not voted in the election of directors and will not be
included in determining which candidates received the highest number of votes.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL OF THE NOMINEES FOR ELECTION
AS DIRECTORS.
DIRECTOR COMPENSATION
The Chairman of the Board of Directors is paid a fee of $1050 per month.
Other directors, except Mr. Lee who is not paid a director's fee, are paid fees
of $850 per month. During 1998, all of the directors other than Mr. Lee were
paid a bonus of $800. Two members of the Board of Directors are related to each
other. M.S. Canaday is Paula Canaday Bowman's uncle.
BOARD OF DIRECTORS MEETINGS
During the last fiscal year, the Board of Directors of the Company met
14 times. Each incumbent director attended 75% or more of the aggregate of the
total number of Board of Director meetings and the total number of meetings held
by all committees of the Board of Directors on which he or she served. The Board
of Directors does not have separate audit or nominating committees, but performs
these functions itself. The Board of Directors Compensation Committee consists
of Harold J. Sturdivant (Past Chairman), Paula Canaday Bowman, Warren L. Grimes
(Chairman) and Ayden R. Lee, Jr. (non-voting member). The Compensation Committee
is responsible for the approval of compensation arrangements for officers of the
Company and the review of the Company's compensation plans and policies. During
the last fiscal year, the Compensation Committee met five times.
6
EXECUTIVE COMPENSATION
The following tables set forth a summary of compensation for Mr. Ayden
R. Lee, Jr., Chief Executive Officer and President of the Company for the fiscal
years indicated. None of the other executive officers had total annual salary
and bonus exceeding $100,000 for any of the past three fiscal years.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION(1) LONG-TERM COMPENSATION
AWARDS PAYOUTS
SECURITIES ALL OTHER
NAME & PRINCIPAL POSITION YEAR SALARY BONUS UNDERLYING OPTIONS COMPENSATION(2)
Ayden R. Lee, Jr., 1998 $144,000 $21,718 6,000 $7,129
Chief Executive Officer 1997 136,082 27,718 -0- 10,196
and President 1996 127,908 5,347 -0- 7,524
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(1) Amounts shown in the table include amounts paid to Mr. Lee as an
executive officer of the Bank. The Bank was reorganized as a
wholly-owned subsidiary of the Company in July 1997. Amounts shown also
include amounts deferred by Mr. Lee under the Company's Master Corporate
Profit Sharing Retirement Plan and Trust.
(2) The amounts shown represent contributions by the Company to Mr. Lee
under the Company's Master Corporate Profit Sharing Retirement Plan and
Trust in the amounts of $6,649, $9,500 and 6,807, for each of the years
ended 1998, 1997 and 1996, respectively. The remainder of the amounts
shown for each year represent insurance premiums paid by the Company on
term life insurance.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information concerning options to
purchase Common Stock granted to Mr. Lee during the year ended December 31,
1998.
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS
OPTIONS GRANTED TO
NAME GRANTED EMPLOYEES IN EXERCISE OR BASE EXPIRATION DATE
FISCAL YEAR PRICE
Ayden R. Lee, Jr. 6,000 33.9% $21.33 April 23, 2002
7
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth certain information concerning options to
purchase Common Stock held by Mr. Lee during the year ended December 31, 1998,
the aggregate value of gains on the date of exercise, and the value of
unexercised options as of December 31, 1998.
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
AT FY-END(#) AT FY-END($)
EXERCISABLE/
UNEXERCISABLE EXERCISABLE/
NAME UNEXERCISABLE (1)
Ayden R. Lee, Jr. 0/6,000 $0/181,500
- ------------------------
(1) Based on a price per share of $30.25 which is the last sale price of
the Common Stock as of December 31, 1998.
EMPLOYMENT AGREEMENT
The Company has an employment agreement with Ayden R. Lee, Jr., Chief
Executive Officer and President. The employment agreement provides for a
one-year term and on each anniversary date thereafter, the agreement
automatically will be extended for an additional year, unless either party gives
notice of nonrenewal. The current base salary under the agreement may be
increased at the discretion of the Board of Directors. The Board of Directors
has established the 1999 base salary amount for Mr. Lee at $152,640. In addition
to the base salary, Mr. Lee's employment agreement provides for, among other
things, additional benefits applicable to executive personnel and benefits
applicable to all salaried employees of the Company. The agreement provides for
termination by the Company for "cause" (as defined in the agreement) at any
time.
SEVERANCE COMPENSATION AGREEMENT
The Company has adopted a severance compensation agreement for Mr. Lee
that will provide him with severance pay benefits in the event of a change in
control of the Company. The purpose of this compensation plan is to recognize
the services and contributions of Mr. Lee as a key employee and the
uncertainties relating to continual employment, reduced employee benefits,
management changes, and relocations in the event of a change in control. Under
the severance compensation agreement, in the event a change in control (as
defined in the agreement) of the Company occurs and Mr. Lee's employment is
"terminated" (as defined in the agreement) he will be entitled to receive a cash
severance payment equal to two years' salary based upon his then most recent
annual compensation and the amount of his most recent annual bonus at the time
of termination. In addition, Mr. Lee will be entitled to all life insurance,
health, accidental death and dismemberment, and disability plans or programs in
which he is entitled to participate immediately prior to his termination for two
years after the date of his termination or unless and until he obtains other
full-time employment.
8
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
The Bank has adopted a supplemental executive retirement plan ("SERP")
for Mr. Lee that, upon his retirement from the Bank, will provide him with
supplemental annual payments for the remainder of his life. The purpose of the
SERP is to encourage Mr. Lee to remain as an employee of the Bank and to reward
him for contributing materially to the success of the Bank. Under the SERP, the
Bank will be obligated to pay Mr. Lee an annual payment upon his retirement in
an amount which, when added to Mr. Lee's Company 401(k) benefits (based on
future estimated amounts) and social security benefits (based on future
estimated amounts), will ensure Mr. Lee a total annual retirement benefit equal
to seventy-five percent (75%) of his Average Annual Compensation (as defined in
the SERP) on the date of his retirement. Depending upon Mr. Lee's age at
retirement, the annual payment as a percentage of Mr. Lee's fully vested
retirement benefit will vary (from 58% of fully vested retirement benefit at age
55 to 100% at age 62). The annual payment which the Company is obligated to pay
Mr. Lee each year after his retirement is subject to certain limitations,
including a maximum limit of $50,000 per year. In the event of a change of
control (as defined in the SERP) of the Company and termination of Mr. Lee's
employment within twenty-four (24) months thereafter (for any reason, except
termination by the Bank for cause), Mr. Lee will be entitled to receive a
lump-sum cash payment equal to the actuarial equivalence of the greater of (i)
the amount he would have been entitled to had he retired on such date and (ii)
the amount of his pro rata fully vested benefit under the SERP as of such date.
CERTAIN TRANSACTIONS
Certain of the directors and executive officers of the Company are
customers of, and borrowers from, the Bank in the ordinary course of business.
From January 1, 1998 to December 31, 1998, loans outstanding to directors and
executive officers of the Company, and their associates as a group, amounted to
a maximum of approximately $970,000, or 5% of the equity capital of the Bank.
All outstanding loans and commitments included in such transactions are made
substantially on the same terms, including rate and collateral, as those
prevailing at the time in comparable transactions with other customers. In the
opinion of management, these loans do not involve more than normal risk of
collectability, or contain other unfavorable features.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's officers, directors, and persons who own more than 10% of
the Company's equity securities, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission ("SEC"). Officers,
directors, and greater than 10% shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) reports they file. Based
solely on a review of the copies of such reports furnished to the Company, or
representations by such persons that no Form 5s were required, the Company
believes that during the fiscal year ended December 31, 1998, all Section 16(a)
filing requirements applicable to its officers, directors, and greater than 10%
shareholders, were satisfied, except Mr. Percy Y. Lee, Mr. Clifton L. Painter
and Mr. Wendell L. Hiatt, III who inadvertently failed to file three, two and
four required reports, respectively. Mr. Lee failed to report three transactions
which occurred in the months of March, June and September,
9
respectively. Mr. Painter failed to report two transactions which occurred in
the months of February and March, respectively. Mr. Hiatt failed to report seven
transactions which occurred in the months of March(1), April(4), June(1) and
September(1). Each of the foregoing transaction were reported late on Form 5s
for the year ended December 31, 1998.
SELECTION OF INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP served as the Company's independent
accountants for the fiscal year most recently completed. PricewaterhouseCoopers
LLP's services to the Company for 1998 included the audit of the Company's
annual consolidated financial statements, reviews of certain of the Company's
income tax returns and consultation on various accounting, tax and other
matters. A representative of PricewaterhouseCoopers LLP is expected to be
present at the Annual Meeting. This representative will have an opportunity to
make a statement if desired and will be available to respond to shareholder
questions. There were no non-audit services provided by PricewaterhouseCoopers
LLP during 1998.
ADDITIONAL INFORMATION
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR
ENDED DECEMBER 31, 1998, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES
THERETO, AS FILED WITH THE SEC WILL BE FURNISHED ON WRITTEN REQUEST, WITHOUT
CHARGE TO ANY COMPANY SHAREHOLDER. SUCH REQUESTS SHOULD BE ADDRESSED TO WANDA J.
BLOW, FOUR OAKS FINCORP, INC., P.O. BOX 309, FOUR OAKS, NORTH CAROLINA 27524
((919) 963-2177).
SUBMISSION OF SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
Any proposals that shareholders intend to present for a vote of
shareholders at the 2000 Annual Meeting of Shareholders, and that such
shareholders desire to have included in the Company's proxy statement and form
of proxy relating to that meeting, must be sent to the Company's principal
executive office, marked to the attention of Ayden R. Lee, Jr., and received by
the Company at such office on or before December 6, 1999. Proposals received
after December 6, 1999 will not be considered for inclusion in the Company's
proxy materials for its 2000 Annual Meeting. The determination by the Company of
whether it will oppose inclusion of any proposal in its proxy statement and form
of proxy will be made on a case-by-case basis in accordance with its judgment
and the rules and regulations promulgated by the SEC.
In addition, if a shareholder intends to present a matter for a vote at
the 2000 Annual Meeting, other than by submitting a proposal for inclusion in
the Company's proxy statement for that meeting, the shareholder must give timely
notice in accordance with SEC rules. To be timely, a shareholder's notice must
sent to the Company's principal executive office, marked to the attention of
Ayden R. Lee, Jr., and received by the Company at such office on or before
February 16, 2000. Such notice should set forth (a) as to each matter the
shareholder proposes to bring
10
before the meeting, a brief description of the business desired to be brought
before the meeting and the reasons for conducting such business at the meeting,
and (b) the name and record address of the shareholder, the class and number of
shares of capital stock of the Company that are beneficially owned by the
shareholder, and any material interest of the shareholder in such business. For
notices that are not timely filed, the Company retains discretion to vote
proxies it receives. For notices that are timely filed, the Company retains
discretion to vote proxies it receives provided (i) the Company includes in its
proxy statement advice on the nature of the proposal and how it intends to
exercise its voting discretion and (ii) the proponent fails to (x) provide the
Company with a written statement, prior to February 19, 2000, that the proponent
intends to deliver a proxy statement and form of proxy to holders of at least
the percentage of the Company's voting shares required under applicable law to
carry the proposal, (y) includes the same statement in its proxy materials filed
with the SEC and (z) immediately after soliciting the percentage of shareholders
required to carry the proposal, provides the Company with a statement from any
solicitor, or other person with knowledge, that the necessary steps have been
taken to deliver a proxy statement and form of proxy to holders of such
percentage of shares.
OTHER MATTERS; DISCRETIONARY AUTHORITY
As of the date of this proxy statement, the Company knows of no business
that will be presented for consideration at the Annual Meeting other than the
items referred to above. The enclosed proxy confers discretionary authority to
vote with respect to any and all of the following matters that may come before
the Annual Meeting: (i) matters that the Company's Board of Directors did not
have notice of by February 16, 1999 in accordance with the preceding paragraph;
(ii) approval of the minutes of a prior meeting of shareholders, if such
approval does not amount to ratification of the action taken at the meeting;
(iii) the election of any person to any office for which a bona fide nominee is
named in this Proxy Statement and such nominee is unable to serve or for good
cause will not serve; (iv) any proposal omitted from this Proxy Statement and
the form of proxy pursuant to Rule 14a-8 or Rule 14a-9 under the Securities
Exchange Act of 1934, as amended; and (v) matters incidental to the conduct of
the Annual Meeting. If any such matters come before the Annual Meeting, the
proxy agents named in the accompanying proxy card will vote in accordance with
their judgment.
All shareholders are encouraged to sign, date, and return their proxy
submitted with this Proxy Statement as soon as possible in the envelope
provided. If a shareholder attends the Annual Meeting, then he or she may revoke
his or her proxy and vote in person.
By Order of the Board of Directors
April 5, 1999
Ayden R. Lee, Jr.
Chief Executive Officer and President
11
***************************** APPENDIX *************************************
PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOUR OAKS FINCORP, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE 1999 ANNUAL
MEETING OF SHAREHOLDERS.
The undersigned hereby appoints Ayden R. Lee, Jr. and M. S. Canaday as proxies,
each with the full power of substitution to represent the undersigned and to
vote all of the shares of stock in Four Oaks Fincorp, Inc. which the undersigned
is entitled to vote at the Annual Meeting of Shareholders of said Company to be
held at the main office of Four Oaks Fincorp, Inc. located at 6144 US 301 South,
Four Oaks, North Carolina on Monday, April 26, 1999 at 8:00 p.m., and any
adjournments thereof (1) as hereinafter specified upon the proposal listed below
as more particularly described in the Company's proxy statement, receipt of
which is hereby acknowledged; and (2) in their discretion upon such other
matters as may properly come before the meeting and any adjournments thereof. In
order to vote for the proposal, place an X in the appropriate box provided
below. The Board recommends a vote "FOR" the proposal listed below.
1. To elect the following nominees as directors of a one year term: M. S.
Canaday; Ayden R. Lee, Jr.; William J. Edwards; Paula Canaday Bowman; Harold J.
Sturdivant; Percy Y. Lee; Warren L. Grimes
[ ] FOR all nominees (except as marked to the contrary below.) [ ] WITHHOLD
AUTHORITY TO vote for all nominees.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE(S) WRITE
THAT NOMINEE(S) NAME ON THE LINE PROVIDED BELOW.)
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PLEASE MARK, SIGN AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE
(CONTINUED FROM OTHER SIDE)
THE BOARD OF DIRECTORS FAVORS A VOTE "FOR" THE ABOVE PROPOSAL AND UNLESS
INSTRUCTIONS TO THE CONTRARY ARE INDICATED IN THE SPACE PROVIDED, THIS PROXY
WILL BE SO VOTED.
SHARES
Please date and sign this Proxy and return promptly.
Dated:_______________________________________ 1999
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Signature
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Signature
NOTE: PLEASE SIGN YOUR NAME EXACTLY AS IT APPEARS ON
THIS CARD. WHEN SIGNING FOR A CORPORATION OR
PARTNERSHIP, OR AS AGENT, ATTORNEY, TRUSTEE,
EXECUTOR, ADMINISTRATOR, OR GUARDIAN, PLEASE INDICATE
THE CAPACITY IN WHICH YOU ARE SIGNING. IN THE CASE OF
JOINT TENANTS, EACH JOINT OWNER MUST SIGN.