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DEF 14A 1 tm228871-2_def14a.htm DEF 14A tm228871-2_def14a - none - 18.3907001s

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant ☐

Filed by a Party other than the Registrant ☐

Check the appropriate box:

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Preliminary Proxy Statement

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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

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Definitive Proxy Statement

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Definitive Additional Materials

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Soliciting Material under §240.14a-12

First Bancorp

(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):

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No fee required.

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Fee paid previously with preliminary materials.

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Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a6(i)(1) and 0-11.

300 SW Broad Street
Southern Pines, North Carolina 28387
Telephone (910) 246-2500

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, MAY 5, 2022

To Our Shareholders:

The annual meeting of shareholders of First Bancorp (the “Company”) will be held at 1:30 p.m. EDST on Thursday, May 5, 2022 at the Main Office of First Bank, located at 300 SW Broad Street, Southern Pines, North Carolina 28387, for the purpose of considering and acting on the following matters:

To elect 14 nominees to the Board of Directors to serve until the 2023 annual meeting of shareholders or until their successors are elected and qualified.

To ratify the appointment of BDO USA, LLP as the independent auditors of the Company for 2022.

To approve, on a non-binding advisory basis, the compensation paid to the Company’s named executive officers, as disclosed in the accompanying Proxy Statement (“Say on Pay”).

To approve an amendment to the Company’s Articles of Incorporation to increase the number of authorized shares of common stock from 40,000,000 to 60,000,000.

Such other business as may properly come before the Annual Meeting and any adjournment thereof.

Only shareholders of record as of the close of business on March 11, 2022 are entitled to notice of and to vote at the Annual Meeting and any adjournment thereof. We first mailed the Notice of Internet Availability of Proxy Materials to our shareholders on or about March 22, 2022.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to be Held on May 5, 2022: This Notice, the Proxy Statement and the Company’s 2021 Annual Report on Form 10-K are available on the Internet at www.proxyvote.com.

The Proxy Statement accompanying this Notice sets forth further information concerning the proposals to be considered at the Annual Meeting. You are urged to study this information carefully. The 2021 Annual Report on Form 10-K includes the Company’s financial statements and other required disclosures, but does not constitute proxy solicitation material.

By Order of the Board of Directors

Elizabeth B. Bostian
Executive Vice President
Chief Financial Officer and General Counsel

March 22, 2022

300 SW Broad Street
Southern Pines, North Carolina 28387
Telephone (910) 246-2500

PROXY STATEMENT

Introduction. This Proxy Statement is furnished to the shareholders (“shareholders,” “you,” or “your”) of First Bancorp (the “Company,” “us,” “we” or “our”) by our Board of Directors (hereinafter sometimes referred to as the “Board”) in connection with its solicitation of proxies for use at the annual meeting of shareholders of the Company (the “Annual Meeting”) to be held on Thursday, May 5, 2022, at 1:30 p.m. EDST, at the Main Office of First Bank, 300 SW Broad Street, Southern Pines, North Carolina 28387, and at any adjournment thereof. Due to the pandemic, we will have limited capacity at our meeting site. Accordingly, we are providing a virtual option for shareholders who wish to participate remotely. Please e-mail Elizabeth Bostian, our Executive Vice President, Chief Financial Officer and General Counsel, at ebostian@localfirstbank.com by 11:59 P.M. EDST on May 3, 2022 with a request for the web link for the meeting.

Action will be taken at the Annual Meeting on the items described in the Notice of Annual Meeting and on any other business that properly comes before the Annual Meeting.

The Company will bear the entire cost of preparing this Proxy Statement and of soliciting proxies. Proxies may be solicited by employees of the Company, either personally, by mail or by telephone. Employees will not receive additional compensation for the solicitation of proxies. The Company also will request brokers and others to send solicitation material to beneficial owners of stock and will reimburse their related costs.

Internet Availability of Proxy Materials. We are providing proxy materials to our shareholders primarily via the Internet, instead of mailing printed copies of those materials to each shareholder. By doing so, we save costs and reduce the environmental impact of our Annual Meeting. On or about March 22, 2022, we mailed a Notice of Internet Availability of Proxy Materials (“Internet Notice”) to certain of our shareholders. The Internet Notice contains instructions about how to access our proxy materials and vote online or by telephone. If you would like to receive a paper copy of our proxy materials, please follow the instructions included in the Internet Notice. If you previously chose to receive our proxy materials electronically, you will continue to receive access to these materials via email unless you elect otherwise.

Proxy Card. The Board has designated Richard H. Moore and Elizabeth B. Bostian to serve as the proxy holders (the “Proxy Holders”) for the Annual Meeting. As Proxy Holders, they will vote the shares represented by proxies at the Annual Meeting. If you sign, date and return your Proxy Card but do not specify how to vote your shares, the Proxy Holders will vote FOR the election of all of the Director nominees, FOR ratification of BDO USA, LLP as the Company’s independent auditors, FOR approval of the advisory vote on the compensation of our named executive officers, and FOR approval of an amendment to the Company’s Articles of Incorporation to increase the number of authorized shares of common stock from 40,000,000 to 60,000,000. The Proxy Holders also will have discretionary authority to vote in accordance with their judgment on any other matter that may properly come before the Annual Meeting.

Quorum, Shares Outstanding and Record Date. A quorum, which is a majority of the total shares outstanding as of the record date, must be present at the Annual Meeting in person or by proxy. On March 11, 2022 (the “Record Date”), a total of 35,631,599 shares of our common stock were outstanding. We also count broker non-votes, which we describe below, as shares present or represented at the Annual Meeting for the purpose of determining whether a quorum exists. If a quorum is not present or represented at the Annual Meeting, the shareholders present and entitled to vote have the power to adjourn the Annual Meeting from time to time, without notice other than announcement at the Annual Meeting, until a quorum is

present or represented. At any such adjourned meeting at which a quorum is present or represented, any business may be transacted that might have been transacted at the Annual Meeting as originally notified.

Vote Required. Each share is entitled to one vote, except in the election of directors where a shareholder may cumulate votes as to nominees, but only when a shareholder gives notice of intent to cumulate votes prior to the voting on nominees for election at the Annual Meeting. If any shareholder gives such notice, all shareholders may cumulate their votes for nominees. Under cumulative voting, each share carries as many votes as the number of directors to be elected, and the shareholder may cast all of such votes for a single nominee or distribute them in any manner among as many nominees as desired. This Proxy Statement solicits the discretionary authority to cumulate votes and allocate them in the Proxy Holders’ discretion if any shareholder requests cumulative voting. Directors will be elected by the affirmative vote of the majority of votes cast, with a plurality vote standard for a contested director election, i.e. when the number of director nominees exceeds the number of Board seats for which elections are being held. If your Proxy Card is marked “Withhold” with regard to the election of any nominee, your shares will be counted toward a quorum and voted for the other nominees, but they will not be voted for the election of that nominee. If you attend the Annual Meeting and have already voted, you must vote in person in order to rescind your previous vote. The proposal to approve, on a non-binding advisory basis, the compensation paid to the Company’s named executive officers (“Say on Pay”) and the proposal to approve an amendment to the Articles of Incorporation to increase the number of authorized shares each requires approval by an affirmative vote of a majority of the votes cast on such proposal. Ratification of the appointment of BDO USA, LLP as the Company’s independent auditor also requires approval by an affirmative vote of a majority of the votes cast on such proposal. If your Proxy Card is marked “Abstain” on a proposal, your shares will not be counted as votes cast on that proposal.

Effect of Abstentions and Broker Non-Votes. Broker non-votes and the shares of a shareholder whose Proxy Card on any or all proposals is marked as “Abstain” will be included in the number of shares present at the Annual Meeting to determine whether a quorum is present. If you are the beneficial holder of shares held by a broker, bank or other holder of record (a “nominee”), you may instruct your nominee how to vote your shares through the voting instruction form included with this Proxy Statement. If you wish to vote the shares you own beneficially at the Annual Meeting, you must obtain a proxy from your nominee. Because directors will be elected by an affirmative vote of the majority of shares cast (or by a plurality of votes in a contested election) and the “Say on Pay” proposal, the proposal to amend the Articles of Incorporation to increase the number of authorized shares and the ratification of the appointment of our independent auditors, each require approval by a majority of the votes cast, votes withheld, abstentions and broker non-votes will have no effect in the election of directors or the approvals of those proposals.

Your vote is very important and we hope that you will attend the Annual Meeting either in person or remotely. However, whether or not you plan to attend the Annual Meeting, please vote by proxy.

Registered Holders. If your shares are registered directly in your name with the Company’s transfer agent, Computershare Limited, you are considered a registered holder of those shares. Please vote by proxy in accordance with the instructions on your Proxy Card or the instructions contained in the Internet Notice.

A registered holder can vote in one of the following ways:

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Via the Internet. Go to the website noted on your Proxy Card in order to vote via the Internet. Internet voting is available 24 hours a day. We encourage you to vote via the Internet, as it is the most cost-effective way to vote. When voting via the Internet, you do not need to return your Proxy Card.

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By Telephone. Call the toll-free telephone number indicated on your Proxy Card and follow the voice prompt instructions to vote by telephone. Telephone voting is available 24 hours a day. When voting by telephone, you do not need to return your Proxy Card.

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By Mail. Mark your Proxy Card, sign and date it, and return it in the enclosed postage-paid envelope. If you elected to electronically access the Proxy Statement, you will not be receiving a Proxy Card and must vote via the Internet or by telephone.

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In Person. You may vote your shares at the Annual Meeting if you attend in person even if you previously submitted a Proxy Card or voted via the Internet or by telephone. Whether or not you plan to attend the Annual Meeting, however, we strongly encourage you to vote your shares by proxy before the Annual Meeting.

Beneficial Shareholders. If your shares are held by a nominee, you are not a registered holder, but rather are considered a beneficial holder of those shares. Your nominee will send you instructions on how to vote your shares. If you are a beneficial holder, you must obtain a proxy, executed in your favor, from your nominee to be able to vote in person at the Annual Meeting.

Voting Deadlines. The Internet and telephone voting facilities for eligible shareholders of record will close at 11:59 p.m., EDST, on May 4, 2022. For shareholders who hold their shares in a brokerage account, please refer to the deadlines established by the broker. For shareholders in our 401(k) plan, the Internet and telephone voting facilities will close at 11:59 p.m., EDST, on May 2, 2022.

Revocation of Proxy. Registered holders who vote by proxy, whether by telephone, Internet or mail, may revoke that proxy at any time before it is voted at the Annual Meeting. You may do this by: (a) signing another Proxy Card with a later date and delivering it to us prior to the Annual Meeting or sending a notice of revocation to the Corporate Secretary of First Bancorp at 300 SW Broad Street, Southern Pines, NC 28387; (b) voting at a later time by telephone or via the Internet prior to the deadlines noted above; or (c) attending the Annual Meeting in person and casting a ballot. If you are a beneficial holder, you may change your vote by submitting new voting instructions to your nominee.

Householding. As permitted by the Securities Exchange Act of 1934 (the “Exchange Act”), only one envelope containing two or more Notices is being delivered to shareholders residing at the same address, unless such shareholders have notified Computershare Limited, or their nominee that they wish to receive separate mailings. If you are a beneficial holder and your shares of common stock are held by a nominee, you may contact your nominee, to discontinue householding and receive your own separate copy of the Notice in future years. If you are a registered holder of record in our shareholder list maintained by Computershare Limited, you may contact Computershare toll-free at 800-368-5948 or in writing directed to Computershare Limited, 250 Royall Street, Mail Stop 1A, Canton, MA 02021 to discontinue householding and receive multiple Notices in future years. To receive an additional Annual Report on Form 10-K or Proxy Statement this year, contact us at Shareholder Relations at 910-246-2500 or follow the instructions on the Notice. Mailing of dividends, dividend reinvestment statements and special notices will not be affected by your election to discontinue duplicate mailings of the Notice of Annual Meeting.

Electronic Access to Proxy Materials and Annual Report. This Proxy Statement and our 2021 Annual Report on Form 10-K are available at www.proxyvote.com. If you hold your common stock through a nominee, you may have the option of receiving your Proxy Statement and Annual Report on Form 10-K via the Internet. If you submit your proxy this year electronically, you may also elect to receive future Proxy Statements, Annual Reports on Form 10-K and other materials electronically by following the instructions given by your nominee when you vote.

PRINCIPAL HOLDERS OF VOTING SECURITIES

The Exchange Act requires that any person who acquires the beneficial ownership of more than five percent of the Company’s common stock notify the Securities and Exchange Commission (the “SEC”) and the Company. Following is certain information, as of the most recent practicable date, regarding those persons or groups who held of record, or who are known to the Company to own beneficially, more than five percent of our outstanding common stock.

Name and Address of Beneficial Owner			Amount and Nature of Beneficial Ownership			Percent of Class(1)
BlackRock Inc. 55 East 52nd Street New York, NY 10055			5,183,539 shares(2)					14.55%

Name and Address of Beneficial Owner			Amount and Nature of Beneficial Ownership			Percent of Class(1)
The Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355			2,310,573 shares(3)					6.48%

(1)

Based on a total of 35,631,599 shares of our common stock outstanding as of the Record Date.

(2)

Based on a Schedule 13G/A filed by BlackRock Inc. on January 27, 2022, that indicates it holds sole power to vote 5,099,252 shares and sole power to dispose of 5,183,539 shares.

(3)

Based on a Schedule 13G/A filed by The Vanguard Group on February 10, 2022, that indicates it holds sole power to vote 0 shares, shared power to vote 30,154 shares, sole power to dispose of 2,254,600 shares and shared power to dispose of 55,973 shares.

PROPOSAL 1 — ELECTION OF DIRECTORS

The Company’s Bylaws provide that the number of directors on our Board will be not less than seven nor more than 25, as may be fixed by resolution duly adopted by the Board at or prior to the annual meeting at which such directors are to be elected. The size of the Board has been fixed at 14 members.

In the absence of any instructions to the contrary, proxies will be voted for the election of all 14 of the nominees listed in the table below. Should cumulative voting apply, the Proxy Holders may cumulate votes and allocate them in their discretion. If, at or before the time of the Annual Meeting, any of the nominees listed below becomes unavailable for any reason, the Proxy Holders have the discretion to vote for a substitute nominee or nominees. The Board currently knows of no reason why any nominee listed below is likely to become unavailable.

Director nominees will be elected by the affirmative vote of the majority of votes cast in the election of directors at the Annual Meeting, with a plurality vote standard for a contested director election, that is, when the number of director nominees exceeds the number of Board seats for which elections are being held, i.e. 14 seats. Abstentions from voting, as well as broker non-votes, if any, are not treated as votes cast and, therefore, will have no effect on the proposal to elect directors.

NOMINATIONS FOR DIRECTOR

Nominees for election to the Board of Directors are selected by the Board prior to each annual meeting upon the recommendation of the Nominating and Corporate Governance Committee. Nominations from shareholders must be made in accordance with the Bylaws, which generally require such nominations to be made in writing and not less than 50 nor more than 75 days before the first anniversary of the date of the distribution of the Company’s proxy statement for the last meeting of shareholders called for the election of directors.

A copy of the Bylaw provision setting forth the complete procedure for shareholder nominations of directors may be obtained upon written request to First Bancorp, 300 SW Broad Street, Southern Pines, North Carolina 28387, Attention: Elizabeth B. Bostian, Executive Vice President, Chief Financial Officer and General Counsel.

Our Bylaws state that a nominee is ineligible to stand for election as a director after he or she has attained the age of 72, absent specific approval of an exception by the Board. In accordance with this policy, Daniel T. Blue, Jr. is retiring from the Board at the Annual Meeting.

See also the section below entitled “Corporate Governance Policies and Practices — Director Nomination Process”.

DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS

Except as otherwise noted below, the following table sets forth certain information as of December 31, 2021, with respect to the Company’s current directors, the 14 nominees for election to the Board of Directors and the current and former executive officers of the Company.

The Board of Directors recommends a vote “FOR” the election of these nominees.

TABLE OF DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS

Name (Age)**

Current Director (D),
Nominee (N) or
Position with Company

Total Number of
Common Shares
Beneficially Owned(1)

Percent
of Class

Directors and Nominees

Richard H. Moore (61)

Chief Executive Officer (D) (N)

129,152

(2)

Michael G. Mayer (62)

President of the Company and Chief Executive Officer and President of First Bank (D) (N)

61,284

(3)

Name (Age)**

Current Director (D),
Nominee (N) or
Position with Company

Total Number of
Common Shares
Beneficially Owned(1)

Percent
of Class

Daniel T. Blue, Jr. (72)

(D)

18,109

Mary Clara Capel (63)

(D) (N)

13,002

James C. Crawford, III (65)

(D) (N)

84,978

(4)

Suzanne S. DeFerie (65)

(D) (N)

83,918(5)

Abby J. Donnelly (59)

(D) (N)

6,034

(6)

John B. Gould (69)

(D) (N)

41,302

(7)

John W. McCauley (54)

(D) (N)

16,299

Carlie C. McLamb, Jr. (57)

(D) (N)

49,014

(8)

Dexter V. Perry (52)

(D) (N)

650

O. Temple Sloan, III (61)

(D) (N)

12,324

Frederic L. Taylor, II (52)

(D) (N)

37,572

Virginia C. Thomasson (70)

(D) (N)

31,628

Dennis A. Wicker (69)

(D) (N)

25,600

(9)

Non-Director Executive Officers

Elizabeth B. Bostian (42)

Executive Vice President, Chief Financial Officer and
General Counsel

4,402

(10)

Gregory A. Currie (44)

Executive Vice President and Chief Banking Officer

12,880

(11)

Eric P. Credle (53) ***

Former Chief Financial Officer

36,191

Directors/Nominees and Non-Director Executive Officers as a Group (18 persons)

664,339

1.90%

Indicates beneficial ownership of less than 1% of the issued and outstanding shares.

Ages as of April 1, 2022.

***

Mr. Credle retired as the Company’s Chief Financial Officer effective November 12, 2021, and his employment with the Company ended on February 25, 2022.

(1)

Unless otherwise indicated, each individual has sole voting and investment power with respect to all shares beneficially owned by such individual, including executive officers’ reported shares in our 401(k) defined contribution plan (“401(k) plan”), which are voted by the plan trustee and not by the executive for whom such shares are listed. There are no shares that may be acquired within 60 days by exercising stock options.

(2)

Mr. Moore’s shares also include 11,432 shares held in the 401(k) plan.

(3)

Mr. Mayer’s shares include 1,017 shares held by his spouse and 1,210 shares held in the 401(k) plan.

(4)

Mr. Crawford’s shares include 8,325 shares held by his spouse and 6,600 shares held jointly with his children.

(5)

Ms. DeFerie’s shares include 1,786 shares held in the 401(k) plan.

(6)

Ms. Donnelly also holds 5,500 shares in a Rabbi Trust for director fees accumulated during her service as a director of Carolina Bank Holdings, Inc.

(7)

Mr. Gould’s shares include 2,301 shares held by his spouse.

(8)

Mr. McLamb’s shares include 12,212 shares held by his spouse.

(9)

Mr. Wicker’s shares include 5,000 shares held by his spouse.

(10)

Ms. Bostian’s shares include 911 shares held in the 401(k) plan.

(11)

Mr. Currie’s shares include 2,058 shares held in the 401(k) plan.

Director Nominees

Mary Clara Capel, 63, is a former member of senior management as the director of administration and marketing at Capel, Incorporated, a rug manufacturer, importer and exporter located in Troy, NC, where she was employed from 1981 until her retirement in September 2017. She is a past member of the North Carolina State Banking Commission and has attended the North Carolina Bank Directors’ College. Ms. Capel has been a director of the Company and First Bank since 2005. Ms. Capel is a former Chair of the Board of Directors.

Ms. Capel brings business executive decision making and oversight skills as a result of her 36 years of experience with a third-generation family business, which grew from its rug manufacturing operation in Troy, North Carolina to importing and exporting rugs worldwide.

James C. Crawford, III, 65, served on the Board of Directors, including as its Chair, of Great Pee Dee Bancorp, Inc., a bank holding company headquartered in Cheraw, SC, from 1992 until its acquisition by the Company in April 2008. Mr. Crawford is the retired Chief Executive Officer of B.C. Moore and Sons, Inc., a department store chain. He has been a director of the Company and First Bank since 2008. Mr. Crawford served as the Chair of the Board of Directors of the Company and First Bank from 2014 until January 2022 and was elected to serve in the newly-created role of Lead Independent Director of the Company in January 2022.

Mr. Crawford brings extensive experience with accounting and finance, as well as oversight and management of multiple businesses.

Suzanne S. DeFerie, 65, served as Executive Vice President and Regional President for the Asheville Region of First Bank upon the merger of ASB Bancorp with the Company in October 2017 until her retirement in September 2019. She served as the President and Chief Executive Officer of ASB Bancorp and Asheville Savings Bank, its banking subsidiary, from 2008 until ASB Bancorp’s merger with the Company. Ms. DeFerie holds a CPA license and is active in the banking industry and the Asheville community, currently serving on the Board of Directors of the Federal Home Loan Bank of Atlanta, ANC Health Care (formerly Mission Health System), the Asheville Area Chamber of Commerce Community Betterment Foundation, and the Asheville Merchants’ Fund.

Ms. DeFerie brings extensive experience in the banking and finance industry and has held numerous leadership positions throughout her professional and volunteer career.

Abby J. Donnelly, 59, is founder and Chief Executive Officer of The Leadership & Legacy Group, a consulting practice in leadership development and executive succession. She is the internationally recognized author of Networking Works!, a workbook and training curriculum on building strong business relationships. Ms. Donnelly served as a director of Carolina Bank Holdings, Inc. (“CBHI”) from 2014 until its merger with the Company in 2017, at which time she joined our Board. Ms. Donnelly has been active in volunteering and serving in many leadership roles in various civic organizations in the Greensboro area. She has attended the North Carolina Bank Directors’ College and the North Carolina Bank Directors’ Assembly.

Ms. Donnelly brings to our Board business leadership, innovation, decision-making expertise, and extensive experience in executive succession planning and exit strategies, as well as oversight skills as a result of her work history, community leadership and ownership of a business.

John B. Gould, 69, has served as President of Cason Companies, Inc., a family-owned business, since 1976 and has been instrumental in the mergers and acquisitions that have grown and diversified the business over more than 40 years. He has served as the Vice Chair of the ASB Bancorp Board, as well as past Chair of the Henderson County Chamber of Commerce and the Henderson County Partnership for Economic Development. He is the current Chair of the Board of Trustees of Blue Ridge Community College and also serves on the UNC Healthcare — Pardee Hospital Board of Directors. He joined our Board upon the merger of ASB Bancorp with the Company in 2017.

Mr. Gould is deeply active in his community and brings decades of business, banking and directorial experience to the Company.

Michael G. Mayer, 62, became the President of First Bank in March 2014, was appointed as a director of First Bank in October 2014, and was named the Chief Executive Officer of First Bank in February 2017. Mr. Mayer was named the President of the Company in February 2016 and was appointed to our Board in February 2017. Prior to joining the Company, Mr. Mayer served as Chief Executive Officer of 1st Financial Services Corporation, the parent company of Mountain 1st Bank & Trust, a position he held from January 2010 until 1st Financial Services Corporation’s acquisition in January 2014. He previously served as President and Chief Executive Officer of Carolina Commerce Bank from 2009 until 2010 and Colony Signature Bank (In Organization) from 2007 to 2009, and has held various senior banking positions over his 35 year banking career.

Mr. Mayer has had an extensive career in the banking industry and brings experience, leadership, and managerial skills to the Board.

John W. McCauley, 54, was a founding member of New Century Bank of Fayetteville, the bank subsidiary of New Century Bancorp, Inc. (subsequently Select Bank and Trust Company and Select Bancorp). Mr. McCauley served on the boards of Select Bank and Select Bancorp from 2004 until their acquisition by the Company in October 2021, at which time he joined the Boards of the Company and First Bank. Mr. McCauley is the Chief Executive Officer of Highland Paving Co., LLC, a highway construction firm engaged primarily in the manufacture and placement of hot mix asphalt. He also is general manager of McCauley-McDonald Investments, Fayetteville, NC, which owns and leases approximately 70 commercial properties in North Carolina. He has attended the North Carolina Bank Directors’ College and holds a Bachelor of Science in Economics from Davidson College, and a law degree from the University of North Carolina School of Law.

Mr. McCauley brings to our Board significant experience as a bank director and legal knowledge, as well as extensive business expertise arising from his oversight and management of multiple companies.

Carlie C. McLamb, Jr., 57, Mr. McLamb served on the Select Bancorp and Select Bank’s boards of directors from 2010 until their acquisition by the Company in October 2021, at which time he joined the Boards of the Company and First Bank. Mr. McLamb is president of Carlie C’s IGA, a retail supermarket chain. Mr. McLamb was a founding director of Computer World Inc. and has served as a director and former chairman of the board of that company. In addition, he is currently serving on the board of directors for the North Carolina Retail Merchants Association and as a trustee of Campbell University. Mr. McLamb has completed the North Carolina Advanced Bank Directors’ College program. Mr. McLamb is a past President of the Carolina Food Industry Council.

Mr. McLamb brings to our Board significant experience as a bank director, extensive business expertise arising from his oversight and management of multiple companies, and valuable experience and knowledge arising from his other board and trustee positions.

Richard H. Moore, 61, was named as President and Chief Executive Officer (“CEO”) of the Company in June 2012.Prior to joining the Company, he served as a managing director of San Diego-based Relational Investors LLC.Prior to joining Relational Investors, Mr. Moore served two terms as State Treasurer of North Carolina and for four years as the Secretary of Crime Control and Public Safety. Mr. Moore also served as Chair of the North Carolina Banking Commission for eight years. Mr. Moore serves on numerous New York Stock Exchange boards and committees and is the past Chair of the NYSE Regulation Board of Directors. Mr. Moore was previously an Assistant U.S. Attorney and also practiced corporate, real estate and tax law for many years. Mr. Moore is a former trustee of Wake Forest University and served on its Investment Committee. Mr. Moore has been a director of the Company and First Bank since 2010.Mr. Moore was elected as the Chair of the Boards of the Company and of First Bank in January 2022.

Mr. Moore’s career has provided him with extensive financial and accounting experience and gives him keen insight with respect to budget and audit matters, as well as the oversight, governance and management of larger organizations.

Dexter V. Perry, 52, is a Certified Financial Planner and a registered Investment Advisor Representative with One Providence Capital, LLC, a registered Investment Adviser Firm based in Cary, N.C. He began his career as a consumer bank manager and investment sales producer with First Union National Bank. After earning a Bachelor of Arts degree in Economics from Duke University in 1991, Mr. Perry served on the Board of Trustees of the N.C. Supplemental Retirement Plan, chairing the audit committee and the investment subcommittee, the latter of which was charged with overseeing and monitoring plan assets in excess of $6 billion and reviewing the investment manager performance of over 25 individual mandates stipulated by the plan. Mr. Perry also served for three years on the board of directors for the John Rex Endowment, also serving as a member of its finance committee, which oversaw investment assets of over $75 million. He also served on the credit committee for Generations Community Credit Union in Durham, NC until its merger with Self-Help Credit Union, in 2014, and served on the boards of directors of Mechanics & Farmers Bank, Durham, NC, and its holding company, M&F Bancorp, Inc. from 2018 until June 2021.

Mr. Perry brings our Board financial, investment and banking expertise, as well as valuable experience and knowledge arising from his board and trustee positions.

O. Temple Sloan, III, 61, is the former Chief Executive Officer and President of General Parts, Inc. (“GPI”), the largest privately-owned auto parts supplier in the United States, which owned and operated more than 3,100 CARQUEST Auto Parts stores and over 80 WORLDPAC branches in the United States, Canada and Puerto Rico. Prior to GPI’s acquisition by Advance Auto Parts, Inc., Mr. Sloan served as President and Chief Executive Officer of GPI from 2008 to January of 2014 and as President of GPI from 2001 to 2008. Mr. Sloan is currently a director of Golden Corral Corporation, and previously served as a director of Advance Auto Parts, Inc. and Car Care Council. He is currently a member of The University of North Carolina Board of Governors, and is a former member of the Board of Trustees of Northwood University.

Mr. Sloan brings our Board business leadership, innovation, executive decision making and oversight skills as a result of 30 years of experience in a commercial business.

Frederick L. Taylor, II, 52, is President of Troy Lumber Company, located in Troy, NC, where he has been employed since 1992. Mr. Taylor has been a director of the Company and First Bank since 2005.

Mr. Taylor brings to our Board business-building skills and experience. Additionally, Mr. Taylor has experience in overseeing the preparation of financial statements and review of accounting matters.

Virginia Thomasson, 70, is a CPA with the firm Brownback & Thomasson CPAs, PLLC, located in Southern Pines, NC, where she is the owner and managing partner. She served as a director of First Savings Bancorp, Inc. from 1997 until its merger with the Company in 2000. Ms. Thomasson has served as a director of the Company and First Bank since 2000. Ms. Thomasson has been designated as an “audit committee financial expert” in accordance with SEC regulations.

Ms. Thomasson brings to the Board experience and skills in public accounting and over 20 years of financial industry experience.

Dennis A. Wicker, 71, is a partner in the law firm of Nelson Mullins Riley and Scarborough, LLP, located in Raleigh, NC, a position he has held since 2009. From 2008 to 2009, Mr. Wicker was a shareholder and a member of the Executive Committee of the law firm of SZD Wicker, LPA, and from 2001 to 2008 he was a partner in the law firm of Helms, Mulliss & Wicker, LLP. Mr. Wicker served in the North Carolina General Assembly from 1981 to 1993, the last four years as House Majority Leader, and as Lieutenant Governor of North Carolina from 1993 to 2001. Mr. Wicker has been a director of the Company and First Bank since 2001. Mr. Wicker currently serves as a director of Coca Cola Bottling Company Consolidated and previously served as a director of Air T, Inc.

Mr. Wicker has an extensive background in law and public service and brings to our Board executive decision making, governance and risk assessment skills.

Executive Officers

In addition to Mr. Mayer and Mr. Moore:

Elizabeth B. Bostian, 42, was named the Chief Financial Officer of the Company and First Bank effective upon Mr. Credle’s retirement in November 2021.She also continues to serve as Executive Vice President and General Counsel of the Company and First Bank, positions she has held since 2016. Ms. Bostian joined the Company and First Bank in 2012 as corporate legal counsel and served as the Secretary of the Company and First Bank from May 2014 to November 2021.

Gregory A. Currie, 44, was named the Executive Vice President and Chief Banking Officer of First Bank in October 2021. Mr. Currie joined First Bank in September 2015 as Executive Vice President and Regional President and served in those roles until being named Executive Vice President and Chief Banking Officer.

Eric P. Credle, 53, served as the Chief Financial Officer of the Company and First Bank from 1997 until his retirement from that position in November 2021. Mr. Credle’s employment with the Company and First Bank ended on February 25, 2022.

BOARD COMMITTEES AND ATTENDANCE

The Board of Directors has established four standing committees: the Executive and Loan Committee, the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee. In addition, the Board may establish other committees from time to time for specific purposes. The following table presents the 2021 membership of the four standing committees (“C” indicates the chair of a committee during 2021).

Executive
and
Loan Committee

Audit
Committee

Compensation
Committee

Nominating and
Corporate
Governance
Committee

Daniel T. Blue, Jr.

Mary Clara Capel

James C. Crawford, III

X (c)

Suzanne S. DeFerie

Abby J. Donnelly

John B. Gould

Michael G. Mayer

John W. McCauley

Carlie C. McLamb, Jr.

Richard H. Moore

Dexter V. Perry

O. Temple Sloan, III

Frederick L. Taylor, II

Virginia C. Thomasson

X (c)

Dennis A. Wicker

Executive and Loan Committee

The Executive and Loan Committee is authorized, between meetings of the Board of Directors, to perform all duties and exercise all authority of the Board, except those duties and authorities exclusively reserved to the Board by applicable law. The Executive and Loan Committee also serves as Loan Committee for First Bank. The Committee held 11 meetings during 2021.

Audit Committee

The Audit Committee is responsible for the appointment, compensation and oversight of the Company’s independent auditors, and must approve in advance all audit fees and the terms of all non-audit services

provided by the independent auditors. The Audit Committee reviews and presents to the Board of Directors information regarding the effectiveness of the Company’s policies and procedures with respect to auditing, accounting, and internal controls. The Audit Committee also reviews the Company’s financial reporting process on behalf of the Board. All of the current members of the Audit Committee are independent, as defined under the rules of The Nasdaq Stock Market (“NASDAQ”) and the Exchange Act, as well as the Company’s Corporate Governance Guidelines. The Board has determined that Ms. Thomasson is an “audit committee financial expert” within the meaning of SEC rules and regulations. The Committee held five meetings during 2021.

The Audit Committee reviews and ratifies its charter on an annual basis. The Audit Committee charter is available on the Company’s website at www.LocalFirstBank.com under the tab “About — Investor Relations — Corporate Overview — Governance Documents.”

Compensation Committee

Generally, the Compensation Committee is responsible for reviewing the compensation policies and benefit plans of the Company and First Bank, and for making recommendations regarding the compensation of their executive officers. The Committee also administers the Company’s equity compensation plans. Each of the current members of the Committee is independent under the rules of the NASDAQ and the Exchange Act, as well as the Company’s Corporate Governance Guidelines. The Committee held three meetings during 2021.

The Compensation Committee reviews and ratifies its charter on an annual basis. The Compensation Committee charter is available on the Company’s website at www.LocalFirstBank.com under the tab “About — Investor Relations — Corporate Overview — Governance Documents.”

Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee is responsible for identifying and recommending qualified individuals to become Board members, determining the composition of the Board and its committees, and developing and implementing the Company’s Corporate Governance Guidelines. The Committee will consider shareholder nominees for Board membership. Any shareholder wishing to nominate a candidate for director must follow the procedures described in the section “Nominations For Director” above. The section below entitled “Corporate Governance Policies and Practices — Director Nomination Process” describes the process utilized by the Committee for identifying and evaluating candidates to be nominated as directors. Each of the current members of this Committee is independent as defined by the rules of NASDAQ and the Company’s Corporate Governance Guidelines. The Committee held three meetings during 2021.

The Nominating and Corporate Governance Committee reviews and ratifies its charter on an annual basis. The Nominating and Corporate Governance Committee charter is available on the Company’s website at www.LocalFirstBank.com under the tab “About — Investor Relations — Corporate Overview — Governance Documents.”

Attendance

The Board of Directors held 14 meetings during 2021. All of the director nominees for election attended at least 75% of the aggregate of the meetings of the Board and the standing Committees on which they served during the period they were directors and members of such Committees.

CORPORATE GOVERNANCE POLICIES AND PRACTICES

The Company has developed, and operates under, corporate governance principles and practices that are designed to maximize long-term shareholder value, align the interests of the Board and management with those of the Company’s shareholders, and promote the highest ethical conduct among directors and employees (“Corporate Governance Guidelines”). Highlights of the Corporate Governance Guidelines are described below.

Director Independence

The Board of Directors believes that a substantial majority of the Board should consist of directors who are independent under the rules of the NASDAQ and the Exchange Act, and as further defined in our Corporate Governance Guidelines. The Board makes an annual determination regarding the independence of each director. The Board last made these determinations for each member of the Board in February 2021, based on the review of director questionnaires designed to elicit information regarding independence. The Board has determined that 12 of its 15 current directors are independent under the rules of the NASDAQ, the Exchange Act and our Corporate Governance Guidelines. The individuals who are not independent are Mr. Moore and Mr. Mayer because they are current employees of the Company, and Ms. DeFerie because she was as an employee of the Company during the last three years.

Annual Director Re-Election

Since the Company’s inception, its Bylaws have required that directors must stand for re-election to the Board of Directors at each annual shareholders’ meeting. The Board believes that this policy allows for shareholders to hold directors more directly accountable for corporate performance compared to the staggered board structure in use at many public companies, which permits directors to hold their positions for several years without re-election.

Board Leadership Structure

The Board of Directors recognizes the importance of a strong independent board. It maintains a supermajority of independent directors, has regular meetings of the Board in executive session without the presence of employee directors, has a succession plan for incumbent management and determines management compensation by a committee of independent directors.

In January 2022, the Board of Directors elected Mr. Moore, the CEO of the Company, as its Chair and elected Mr. Crawford, who had served as the Chair since 2014, to serve in the newly-created role of Lead Independent Director. In structuring the Board leadership in this manner, the Board recognized the benefits of having an executive chair with deep experience in the financial services industry and knowledge of the Company’s emerging risks and issues that flows from close coordination with the management team. The combined CEO and Chair role allows the Company to communicate its strategy to employees, customers, regulators, shareholders, and other stakeholders with a single voice.

The Company likewise benefits from a Lead Independent Director. The Lead Independent Director’s duties and responsibilities include: setting the agenda for and presiding over meetings of the non-employee directors; advising the Chair and CEO as to the quality, quantity, and timeliness of the flow of information from the Company’s management that is necessary for the non-employee directors to effectively and responsibly perform their duties; acting as a “sounding board” and advisor to the Chair and CEO; contributing to the performance review of the Chair and CEO; and staying informed about the strategy and performance of the Company and reinforcing that expectation for all Board members.

The Board’s Role in Risk Oversight

The Board believes that each director has a fiduciary duty to monitor and assist in managing risks faced by the Company. At a minimum, this requires our directors to actively engage in Board discussions, review materials provided to them, and know when it is appropriate to request further information from management and/or engage the assistance of outside advisors. Furthermore, because the banking industry is highly regulated, certain risks to the Company are monitored by the Board and the Audit Committee through reviews of the Company’s and First Bank’s compliance with banking laws and regulations and recommendations contained in regulatory examinations.

Because we believe risk oversight is a responsibility for each member of the Board of Directors, we do not concentrate the Board’s responsibility for risk oversight in a single committee. Instead, each of our Committees concentrates on specific risks for which its members have an expertise, and each Committee is required to regularly report to the Board of Directors on its findings. For example, the Audit Committee regularly monitors the Company’s and Bank’s exposure to fraud and internal control risk. Our

Compensation Committee’s role in monitoring the risks related to our compensation structure is discussed in further detail below. See “Compensation Committee Report” on page 27.

Executive Sessions

The Board of Directors has adopted a resolution requiring that the independent directors of the Company meet at least twice a year in executive session with no non-independent directors or employees of the Company present. At these meetings, the independent directors discuss strategic or other key issues regarding the Company. Two such executive sessions were held in 2021.

Director Nomination Process

The Nominating and Corporate Governance Committee is responsible for identifying individuals qualified to become Board members and recommending nominees for election to the Board. The goal of the Committee is to create a Board that will demonstrate objectivity and the highest degree of integrity on an individual and collective basis. In evaluating current members and new candidates, the Committee considers the needs of the Board and the Company in light of the current mix of director skills and attributes. In addition to requiring that each director possess the highest integrity and character, the Committee’s evaluation of director candidates includes an assessment of issues and factors regarding an individual’s familiarity with the market areas of First Bank, independence as defined by the various applicable laws and rules, business experience, accounting and financial expertise, diversity, and awareness of the Company’s responsibilities to its customers, employees, regulatory bodies, and the communities in which it operates. The Committee also takes into consideration the Board’s established policies relating to the Board’s retirement policy and the ability of directors to devote adequate time to Board and committee matters. When the Committee is considering current Board members to recommend for re-election, it also considers prior Board contributions and performance, as well as meeting attendance records.

The Nominating and Corporate Governance Committee does not have any formal guidelines regarding how it should consider diversity in identifying nominees for director. However, the Committee values the diversity on our current Board and is cognizant of the benefits of a diverse membership. Based upon self-identification by each member of the Company’s Board, the diversity composition of the Board is as follows:

Board Diversity Matrix (As of December 31, 2021)
Total Number of Directors: 15
	Female	Male
Part I: Gender Identity
Directors	4	11
Part II: Demographic Background
African American or Black	—	2
White	4	9

The Nominating and Corporate Governance Committee may seek the input of the other members of the Board and management in identifying and attracting director candidates that are consistent with the criteria outlined above. In addition, the Committee may use the services of consultants or a search firm, although it has not done so in the past. The Committee also will consider recommendations by shareholders of qualified director candidates for possible nomination to the Board. Shareholders may recommend qualified director candidates by writing to the Company’s Corporate Secretary at 300 SW Broad Street, Southern Pines, North Carolina 28387. Submissions should include information regarding a candidate’s background, qualifications, experience, and willingness to serve as a director. Based on a preliminary assessment of a candidate’s qualifications, the Committee may conduct interviews with the candidate and request additional information from the candidate. The Committee uses the same process for evaluating all nominees, including those recommended by shareholders.

In addition, the Company’s Bylaws contain specific conditions under which persons may be nominated directly by shareholders as directors at an annual meeting of shareholders. The provisions include the

condition that shareholders comply with the advance notice requirements described under the section entitled “Nominations for Director” above.

Stock Ownership Requirements

The Board of Directors has adopted a stock ownership policy for all directors. This policy requires that any nominee for the Board must either own, or commit to acquire, common stock of the Company with a monetary value at least equal to five times the cash value of annual director compensation. Newly elected directors have until January 1st of the third year following the date of their election to satisfy this minimum stock ownership requirement. Once the minimum ownership requirement is met, the Board member is deemed to have satisfied this requirement even if subsequent decreases in the Company’s stock price cause the value of the member’s holdings to fall below the minimum threshold. All current directors and nominees are currently in compliance with the policy. The Board believes that this stock ownership policy substantially enhances shareholder value by materially aligning the Board’s interests with those of our shareholders.

Mandatory Retirement

The Bylaws state that a nominee will be ineligible to stand for election as a director after he or she has attained the age of 72, absent specific approval of an exception by the Board. All of the nominees are less than 72 years of age.

Communications with Directors

The Board of Directors believes that it is important that a direct and open line of communication exist between the Board and our shareholders and other interested parties. Any shareholder or other interested party who desires to contact one or more of the Company’s directors may send a letter to the following address:

First Bancorp Board of Directors
300 SW Broad Street
Southern Pines, North Carolina 28387

In addition, any shareholder or other interested party who has any concerns or complaints relating to accounting, internal controls or auditing matters may contact the Audit Committee by writing to the following address:

First Bancorp Audit Committee
300 SW Broad Street
Southern Pines, North Carolina 28387

All such communications will be forwarded to the appropriate party as soon as practicable without being screened.

Annual Meeting Policy

Directors are expected to attend the Annual Meeting. All members of the Board attended the Company’s 2021 annual meeting of shareholders.

Code of Ethics

The Board of Directors has adopted a Code of Ethics that applies to the Company’s directors and employees, including the CEO, President and Chief Financial Officer. The Code includes guidelines relating to ethical handling of actual or potential conflicts of interest, compliance with laws, accurate financial reporting, and procedures for promoting compliance with, and reporting violations of, the Code of Ethics. The Code of Ethics is available on the Company’s website at www.LocalFirstBank.com under the tab “About — Investor Relations — Corporate Governance.” Any amendments or waivers to the Code of Ethics will be disclosed in the same location on the Company’s website.

Those nominees who receive an affirmative vote of the majority of votes cast, with a plurality vote standard for a contested director election, will be elected as directors. The Board of Directors recommends that shareholders vote “FOR” each of the 14 nominees listed above. Unless indicated to the contrary, proxies will be voted “FOR” each of the 14 nominees.

COMPENSATION DISCUSSION AND ANALYSIS

We discuss below our compensation program for our named executive officers (“NEOs”), our principal executive officer, our current and former principal financial officer, and our other most highly compensated executive officers. The compensation policies relating to our CEO are discussed separately in cases where the policies differ materially for our other named executive officers (“Other NEOs”). We focus on compensation and practices relating to 2021, our most recently completed fiscal year, with prior years referenced as necessary to provide context.

Structure and Role of the Compensation Committee

The Board’s Compensation Committee (referred to as the “Committee” in the remainder of the Compensation Discussion and Analysis) consists entirely of independent directors.

The Committee is primarily responsible for the following:

•

reviewing the Company’s overall compensation practices as they relate to the Company’s risks;

•

reviewing the performance of our CEO;

•

determining, or recommending to the Board for its determination, the CEO’s compensation, including salary, bonus, incentive and equity compensation;

•

reviewing and approving the CEO’s recommendations about the compensation of our Other NEOs;

•

recommending to the Board the performance targets for our annual incentive bonus plan;

•

periodically reviewing our equity-based and other incentive plans and recommending any revisions to the Board;

•

recommending to the Board any discretionary 401(k) contributions;

•

recommending director compensation to the Board;

•

approving any equity compensation grants;

•

approving employment or other agreements with the Company’s executive officers; and

•

reviewing the Company’s compliance with legal and regulatory requirements related to compensation arrangements or practices.

Compensation Philosophy and Objectives

The objectives of our executive compensation programs are as follows:

•

fairly compensating executive officers for their efforts;

•

attracting and retaining quality executive leadership;

•

rewarding the achievement of annual corporate performance targets; and

•

aligning executive officers’ long-term interests with those of our shareholders.

Our compensation program seeks to reward our executives’ contributions to corporate performance, including contributions of leadership, effort, creative ideas, industry and operational knowledge and ethical behavior, all in pursuit of increasing shareholder value. The Committee’s general philosophy is that we should compensate our executive officers at approximately the same average level as corresponding officers at similarly situated peer financial services companies. While that is our general philosophy, we may position a base salary in the upper quartile of the market due to experience, performance, or competitive situations. Also, we provide incentives that may result in compensation reaching the upper quartile of the market when performance exceeds targets.

Because the Committee bases its compensation decisions on the objectives and philosophy described above, it does not take into account an individual’s net worth or the wealth the individual has accumulated from prior compensation.

Competitive Positioning

Periodically, the Committee engages outside compensation consultants to evaluate whether our compensation practices are consistent with meeting our objectives. In these engagements, the Committee instructs the consultant to compare our compensation practices and compensation levels to those of a peer group of similarly situated financial services companies. The consultant then provides the Committee with analyses and recommendations.

In February 2019, the Committee engaged and met with Pearl Meyer & Partners (“Pearl Meyer”) to review and advise the Committee on executive compensation matters. At this meeting, Pearl Meyer presented the Committee with its findings, which it based on a study of 2017 data (the most recent data then available).

The Pearl Meyer analyses compared the compensation of our NEOs to a representative sample of 17 publicly traded financial institutions that were comparable to the Company in either location and asset size or in performance measures. This peer group consisted of the following companies:

	• Carolina Financial Corporation			• Park National Corporation
	• Eagle Bancorp, Inc.			• Peoples Bancorp
	• City Holding Company			• S&T Bancorp
	• Community Trust Bancorp, Inc.			• Sandy Spring Bancorp, Inc.
	• FB Financial Corporation			• Seacoast Banking Corporation of Florida
	• First Commonwealth Financial Corp.			• ServisFirst Bancshares, Inc.
	• Franklin Financial Network, Inc.			• Republic Bancorp, Inc.
	• HomeTrust Bancshares, Inc.			• TriState Capital Holdings, Inc.
	• Mercantile Bank Holding Corp.

The results of the analyses were considered by the Committee in determining the appropriate components and amounts of executive compensation for 2021, as described below. Also, as discussed below, these 2019 analyses were updated in February 2020 with respect to the compensation for Mr. Mayer and updated analyses with a new set of peer banks were obtained from Pearl Meyer in January 2022 for the purpose of setting 2022 compensation, as discussed further below.

Executive Compensation Program Overview

The five primary components of our executive compensation program are:

•

Base salary;

•

Annual cash incentives;

•

Equity grants;

•

Benefits; and

•

Post-termination compensation.

In the information that follows, we discuss the compensation of our CEO and then we discuss the compensation of our Other NEOs.

Compensation of Richard H. Moore, Chief Executive Officer

Base Salary — In February 2020, based on the 2019 Pearl Meyer analyses and a review of the Company’s performance, Mr. Moore’s base salary was adjusted from $400,000 to $475,000. In setting the $475,000 salary, the Committee noted that it was below the competitive range relative to chief executive officer compensation, but balanced that finding by noting that many of the day-to-day responsibilities of managing the Company had been transitioned to Mr. Mayer. However, in response to market uncertainty related to COVID-19, in March 2020, Mr. Moore requested that his salary be adjusted back to its 2019 level of $400,000 until market conditions normalized. Mr. Moore’s base salary remained at that level for the remainder of 2020. In February 2021, the Committee reviewed the elements of Mr. Moore’s compensation, market conditions,

and the performance of the Company and returned his salary to the $475,000 level that had originally been set for 2020. Mr. Moore’s salary remained at $475,000 for the remainder of 2021.

Performance Incentive Plan — Mr. Moore’s employment agreement provides that he shall have the opportunity to earn an annual bonus based on the Company’s achievement of performance goals established and weighted by the Committee. The range of the annual performance bonus is $120,000 to $480,000 and is payable 50% in cash and 50% in restricted stock, with the stock vesting annually in one-third increments. If the Company achieves the “threshold” performance for all goals for a year, Mr. Moore earns a bonus with a value of $120,000; if the Company achieves each performance goal at a higher “target” level, he earns a bonus with a value of $240,000; and if the Company achieves each performance goal at or above a higher “maximum” level, he earns a bonus with a value of $480,000. When the Company’s performance falls between these levels for a particular goal, Mr. Moore’s bonus is calculated on the basis of straight line interpolation between the applicable levels. Payment of the bonus is also conditioned on the Company having achieved a satisfactory regulatory review as of such date as determined by the Board of Directors. Furthermore, any bonus is subject to clawback provisions that allow the Company to recoup the amounts paid if the Company is required to restate its financial statements within three years of the payment. The amount of any clawback is computed by calculating the difference in the award payment based on the restated financial statement amounts compared to the amounts that were used to calculate the initial award.

The Company’s 2021 performance goals were the same for Mr. Moore as those for the Other NEOs under our Annual Incentive Plan and are discussed below in the section for Other NEOs. The Committee reviewed the Company’s performance for 2021 and determined that Mr. Moore’s payout according to the formula noted above resulted in a bonus of $398,640. Mr. Moore was paid 50% of that amount in cash, which amounted to $199,320, and he was granted 4,344 shares of the Company’s restricted common stock, with a value of $199,320 which will vest in equal one-third increments on December 31, 2022, December 31, 2023 and December 31, 2024. Additionally, based on the Committee’s review of Mr. Moore’s other achievements and the Company’s performance in 2021, the Committee awarded Mr. Moore an additional cash bonus of $100,000.

Long-Term Equity Grants — As discussed in more detail in the section below entitled “Equity Grants,” in July 2021, Mr. Moore and other officers of the Company, were granted restricted shares of the Company’s common stock in an effort to promote share ownership and management retention. The shares granted vest after three years. For 2021, the value of Mr. Moore’s grant was set at 100% of his base salary, which was unchanged from 2020. Accordingly, the Committee awarded Mr. Moore 12,245 shares of restricted stock on July 27, 2021, which had a value of $475,000.

In addition to the financial terms discussed above, other provisions of Mr. Moore’s employment agreement are as follows:

•

One year term, automatically renews unless either party gives written notice of non-renewal;

•

A right to participate in Company benefit plans made available to other employees — see discussion of these benefits in the section below entitled “Other NEOs;”

•

Reimbursement of the costs of participation in the North Carolina State Health Plan;

•

Upon termination and the occurrence of certain events within 12 months of a change in control, the right to receive 2.99 times his base salary, continuation of health insurance reimbursements for 12 months, and vesting of any unvested long-term incentive compensation awards;

•

In the event of termination by the Company without “cause,” his long-term incentive compensation awards vest in full; and

•

For six months following termination of employment, he is subject to noncompetition and nonsolicitation restrictions.

Any long-term incentive compensation awards granted to Mr. Moore are expected to be made pursuant to the Company’s 2014 Equity Plan, which has clawback provisions — see the section below entitled “Equity Grants.”

Changes for 2022

In January 2022, in addition to his role as CEO, Mr. Moore was elected to be the Chair of the Board of Directors. In connection with the additional responsibilities he assumed as Chair, as well as part of its regular review of NEO compensation, in January 2022, the Committee engaged Pearl Meyer to perform a study and make recommendations as it relates to Mr. Moore’s compensation.

The Pearl Meyer analyses included a comparison of Mr. Moore’s compensation to a representative sample of 21 publicly traded commercial financial institutions based on a study of 2020 data (the most recent data then available). The peer financial institutions in the study were located in the contiguous United States and were comparable to the Company in asset size. This peer group consisted of the following companies:

	• Brookline Bancorp, Inc.			• Renasant Corporation
	• Customers Bancorp, Inc.			• S&T Bancorp, Inc.
	• Eagle Bancorp, Inc.			• Sandy Springs Bancorp, Inc.
	• FB Financial Corporation			• Seacoast Banking Corporation of Florida
	• First Busey Corporation			• ServisFirst Bancshares, Inc.
	• First Commonwealth Financial Corp.			• TowneBank
	• First Financial Bancorp			• TriState Capital Holdings, Inc.
	• Heartland Financial			• Trustmark Corporation
	• Lakeland Bancorp, Inc. • Park National Corporation • Northwest Bancshares, Inc.			• United Community Banks, Inc • WesBanco, Inc.

Based on this analyses, Pearl Meyer recommended that Mr. Moore’s base salary be adjusted to $525,000, with his other compensation elements remaining the same. Pearl Meyer concluded that this change would put Mr. Moore’s compensation as Chair and CEO in approximately the 50th percentile of similarly situated executives of peer financial institutions. The Committee accepted this recommendation and Mr. Moore’s base salary was set at $525,000 for the remainder of 2022.

Compensation of Other NEOs

Base Salary. We pay each of our Other NEOs a base salary because it provides a minimum level of compensation and is necessary for recruitment and retention. The Committee intends that our Other NEOs’ base salaries will provide them with a competitive baseline level of compensation commensurate with their individual experience, performance and scope of responsibility. An important aspect of base salary is the ability of the Committee, the Board and the CEO (in the case of Other NEOs’ salaries) to use annual base salary adjustments to reflect an individual’s performance or changed responsibilities.

Base salary levels are also important because we generally tie incentive and long-term compensation to an officer’s base salary. For example, awards under our Annual Incentive Plan, are denominated as a percentage of base salary.

In February 2020, the Committee reviewed the base salaries of our Other NEOs, who at the time were Mr. Mayer and Mr. Credle.

•

For Mr. Mayer, Pearl Meyer updated its 2019 compensation analyses discussed above by obtaining the most recent compensation information for the 17 peers from that study and also compared Mr. Mayer’s compensation to both a regional index and a national index of financial institutions with total assets of between $5 million and $10 million

•

Based on the strong performance of the Company, Pearl Meyer recommended a level of direct compensation that would position Mr. Mayer’s total direct compensation at approximately the 75th percentile of the 17 member peer group and at approximately 50% of the average of the regional index

and the national index. That recommendation resulted in the following proposed changes to Mr. Mayer’s direct compensation:

•

Base salary increased from $550,000 to $625,000;

•

Target incentive bonus percentage increased from 50% to 55% of base salary; and

•

Long-term equity grant percentage increased from 50% to 60% of base salary.

The Committee accepted those recommendations for 2020 and, thus, approved an increase in Mr. Mayer’s base salary to $625,000 for the remainder of 2020. However, in response to market uncertainty related to COVID-19, in March 2020, Mr. Mayer requested that his salary be adjusted back to its 2019 level of $550,000 until market conditions normalized. Mr. Mayer’s base salary remained at that level for the remainder of 2020. In February 2021, the Committee reviewed the elements of Mr. Mayer’s compensation, market conditions, and the performance of the Company and returned his salary to the $625,000 level that had originally been set for 2020. Mr. Mayer’s salary remained at $625,000 for the remainder of 2021.

•

For Mr. Credle, the Committee determined that Mr. Credle’s base salary for 2020 would remain at its 2019 amount of $367,500, which the 2019 Pearl Meyer analyses indicated resulted in total compensation at approximately the 50th percentile of the peer group for chief financial officers. In February 2021, the Committee reviewed the elements of Mr. Credle’s compensation, his performance, market conditions, and the performance of the Company and adjusted his base salary upwards by 5% to $385,875, with all other compensation elements remaining the same.

In October 2021, the Company announced changes in its organizational structure and to its management team. These changes included (i) the retirement of Mr. Credle as Chief Financial Officer, effective on November 12, 2021, (ii) the naming of Elizabeth B. Bostian to succeed Mr. Credle as Chief Financial Officer, as well as retaining her position as Executive Vice President and General Counsel of the Company, and (iii) the naming of Gregory A. Currie as the Chief Banking Officer of First Bank. This resulted in Ms. Bostian and Mr. Currie becoming NEOs of the Company.

In December 2021, in recognition of their new roles and responsibilities, the Committee reviewed and adjusted the salaries of Ms. Bostian and Mr. Currie, with Ms. Bostian’s base salary being set at $340,000 and Mr. Currie’s base salary being set at $375,000.

See “Changes to 2022 Compensation Elements for Other NEOs” below for discussion of salaries for 2022.

Annual Incentive Plan. The Annual Incentive Plan provides our Other NEOs and other officers with the opportunity to earn an annual cash and/or stock bonus if the Company achieves certain performance goals. The Committee and the Board believe that a meaningful amount of each of our Other NEO’s annual compensation should be tied to the Company’s performance. The Committee believes this structure reflects a proper balance of compensation that provides our officers with a baseline level of financial stability (in the form of base salary), while also providing an appropriate incentive based on the Company’s performance. Amounts of annual incentive earned were included in the Pearl Meyer analyses described above, which the Committee considers in determining the appropriateness of amounts of annual incentive awards that are able to be earned by our NEOs.

Our Annual Incentive Plan pays cash and stock bonuses within the first 75 days of each year based on the Company’s performance in the prior year. Each participant’s total possible bonus is based on a target bonus percentage set for each participant. The Plan uses multiple performance measures to determine the amount of each participant’s total bonus. The Committee assigns a weight to each performance measure, with the sum of the weights equal to 100%. The weight is the percentage of each participant’s total bonus that will be based on that particular performance measure. The Committee also sets threshold, target and maximum performance levels for each measure. If we do not achieve the threshold performance level, participants earn no bonus for that measure. Participants earn 50% of their target bonus for the measure if we meet the threshold level, 100% if we meet the target level and 150% if we achieve or exceed the maximum level.

The following are the target bonus percentages for our Other NEOs that were set by the Committee for 2021 performance:

•

Mr. Mayer’s 2021 target bonus percentage remained at its 2020 level of 55% of his base salary;

•

Ms. Bostian’s and Mr. Currie’s target bonus percentages were set at 25% of their base salaries; and

•

Mr. Credle’s 2021 target bonus percentage remained at its 2020 level of 35% of his base salary.

In order to determine each Other NEO’s cash bonus, the applicable target bonus percentage is multiplied by the executive’s base salary, which is then multiplied by the sum of the performance percentages earned. Bonuses are directly proportional to performance between any of these set points. Thus, an Other NEO’s actual bonus could range from 0% to 150% of the executive’s target bonus percentage.

The Annual Incentive Plan includes clawback provisions that allow the Company to recoup amounts paid to Other NEOs and other designated employees under the Plan if the Company is required to restate its financial statements. The amount of any clawback is computed by calculating the difference in the award payment based on the restated financial statement amounts compared to the amounts that were used to calculate the initial award.

The following table shows the thresholds, targets, maximums and weightings for each performance goal that the Committee approved for 2021 for the Company’s corporate officers, which included each of the Company’s NEOs except for Mr. Currie, who, because he had been a Regional Executive for most of 2021, had his performance goals measured on the region-specific measures and goals that had been set for his region for 2021. Those region-specific measures and goals applicable to Mr. Currie were similar to the corporate goals. The table below also reflects the performance percentages that resulted from the actual results as it relates to executive officers:

	Measurement	Threshold			Target			Maximum			Weight		Actual for 2021*			Performance Percentage
1	Earnings Per Share – Diluted		$	2.47		$	2.90		$	4.35		50%		$	4.00		69.0%
2	Regional Loan Growth			2.0%			3.1%			6.1%		25%			3.8%		27.9%
3	Retail Deposit Growth			-3.0%			0.0%			6.0%		15%			21.9%		22.5%
4	Efficiency Ratio			60.2%			56.7%			52.3%		10%			53.4%		13.8%
												100%					133.2%

In determining the actual amounts for 2021, the Committee excluded the estimated impact on each measurement item of the Company’s acquisition of Select Bancorp which occurred on October 15, 2021.

The Committee selected the above measures and goals for our executive officer compensation because we use those same types of criteria for our branch employees and we desire to have the interests of our executive officers aligned as much as possible with our employees in the field. The following includes some of the specific reasons we selected each measure and goal:

(1)

Earnings Per Share — Diluted — A direct profitability measure.

(2)

Regional Loan Growth — Impacts the profitability and franchise value of the Company.

(3)

Retail Deposit Growth — Funds future growth and impacts the profitability and franchise value of the Company.

(4)

Efficiency Ratio — Impacts the profitability of the Company. We calculate the efficiency ratio as follows:

•

Tax Equivalent Net Interest Income, excluding Loan Discount Accretion + Noninterest Income

•

Divided by Noninterest Expenses, excluding Intangibles Amortization and Merger Expenses, excluding Foreclosed Property Gains/Losses and Other Gains/Losses

•

Each of the excluded items noted above is excluded because they are beyond the control of management.

In addition to the measures and goals noted above, the Committee also set two qualifying triggers that the Company must meet for any of the above-described bonuses to be paid (i.e., each triggering qualification must be met before any bonus may be paid). The two triggers were:

•

The Committee’s determination that the results of the annual safety and soundness exam of First Bank performed by regulatory authorities were satisfactory; and

•

The Company’s earnings per share had to exceed $1.91, which was approximately two-thirds of the budgeted goal.

As shown above, the 2021 total payout percentage for executive officers under the Annual Incentive Plan was 133.2%, while it was determined that Mr. Currie’s region-specific performance percentage was 115.2%. Additionally, the Committee determined that the two triggers were achieved.

Accordingly, the following table illustrates how each Other NEO’s incentive bonus for 2021 was calculated.

Other NEO	(A) 2021 Salary ($)		(B) Target Bonus Percentage		(C) Performance Percentage		(A times B times C) Value of Incentive Plan Compensation ($)
Michael G. Mayer		625,000		55.0%		133.2%		457,875
Elizabeth B. Bostian		340,000		25.0%		133.2%		113,220
Gregory A. Currie		375,000		25.0%		115.2%		108,000
Eric P. Credle		385,875		35.0%		133.2%		179,895

At its January 2022 meeting, the Committee determined that, consistent with the practices followed in recent prior years, 14 senior members of the Company’s management team, including Mr. Mayer, Ms. Bostian and Mr. Currie, would receive 50% of their 2022 bonus that related to 2021 performance in cash and the other 50% in shares of restricted stock. The Committee determined that the stock would vest in one-third increments at December 31, 2022, December 31, 2023 and December 31, 2024. This determination was made in order to promote retention and share ownership among members of senior management. Because of Mr. Credle’s impending retirement, the Committee determined that his bonus would be paid solely in cash. Additionally, based on the Committee’s review of Mr. Mayer’s and Mr. Currie’s performance and the Company’s performance in 2021, the Compensation Committee granted Mr. Mayer an additional cash bonus of $150,000 and Mr. Currie an additional bonus of $42,000 to be paid in 50% cash and 50% in shares of restricted stock with the same vesting terms as those noted above.

As a result, the following payouts were made in February 2022:

•

Mr. Mayer was granted 4,989 shares of stock with a value of $228,937 and was paid $378,938 in cash;

•

Ms. Bostian was granted 1,233 shares of stock with a value of $56,610 and was paid $56,610 in cash; and

•

Mr. Currie was granted 1,634 shares of stock with a value of $75,000 and was paid $75,000 in cash.

•

Mr. Credle was paid cash of $179,895.

See “Changes to 2022 Compensation Elements for Other NEOs” below for discussion of changes in incentive bonus targets for 2022.

Long-Term Equity Grants. As discussed, in February 2022, under the Annual Incentive Plan the Committee approved equity grants to our NEOs related to performance for 2021.

Additionally, in order to promote share ownership and management retention, and consistent with past consultations with our compensation consultant, the Committee typically grants restricted shares of shares of common stock annually to various officers, including each of our NEOs, with full vesting to occur on the third anniversary of the grant date. The following are the percentages of the respective annual base salaries of each Other NEO that were set as the grant values in 2021: Mr. Mayer — 60%, Ms. Bostian — 15%,

Mr. Currie — 20%, Mr. Credle — 20%. See discussion regarding Mr. Moore’s grant in the section above titled “Compensation of Richard H. Moore, Chief Executive Officer.”

The following table presents information on the regular 2021 grants to our Other NEOs.

Other NEO

Date of Grant

Number of Shares
Granted

Value of Grant ($)

Vesting Date

Michael G. Mayer

July 27, 2021

9,667

375,000

July 27, 2024

Elizabeth B. Bostian

July 27, 2021

753

29,217

July 27, 2024

Gregory A. Currie

July 27, 2021

1,830

71,000

July 27, 2024

Eric P. Credle

July 27, 2021

1,989

77,175

July 27, 2024

Assuming acceptable financial performance, it is expected that similar annual grants will be made in 2022, as adjusted for any changes in the grant value that are set by the Committee.

In addition, to the above grants, on December 31, 2021, in recognition of their increased responsibilities that occurred in the fourth quarter of 2021 and to promote retention and share ownership, Ms. Bostian and Mr. Currie were each granted 10,936 restricted shares of common stock that had a value of $500,000 on the grant date. These awards will fully vest on December 31, 2024.

All grants of restricted shares are made under the Company’s 2014 Equity Plan. The 2014 Equity Plan has clawback provisions that provide that any compensation paid pursuant to the Plan which is subject to recovery under any law, government regulation or stock exchange listing requirement, including, but not limited to, the Dodd-Frank Wall Street Reform and Consumer Protection Act and related implementing rules and regulations (“Dodd Frank Act”), will be subject to such deductions, recovery and clawback as may be required to be made pursuant to such law, government regulation or stock exchange listing requirement. Participants shall, upon written demand by the Company, promptly repay any such compensation or take such other action as the Company may require for compliance with these provisions.

Changes to 2022 Compensation Elements for Other NEOs

At its January 2022 meeting, the Compensation Committee reviewed the compensation elements for its Other NEOs. As it relates to Mr. Mayer, the Committee reviewed Pearl Meyer’s analyses that included the same set of peer financial institutions as was noted above for Mr. Moore. Based on review of those analyses, the Committee approved the following elements of 2022 compensation for Mr. Mayer, which the Committee concluded would result in Mr. Mayer’s total compensation being at approximately the 50th percentile of the comparable peers:

•

Base salary increased from $625,000 to $725,000;

•

Target incentive bonus percentage increased from 55% to 75%;

•

Long-term equity grant percentage increased from 60% to 85%; and

•

Payment of a $500,000 retention and retirement payment into Mr. Mayer’s deferred compensation plan, which Mr. Mayer will have the opportunity to invest in a variety of investment options and assumes the risk of the investment. The retention payment and any earnings will vest 25% per year over four years.

Additionally, the Committee increased Mr. Currie’s 2022 target incentive bonus percentage from 25% to 50%. All other elements of compensation for our Other NEOs remain unchanged for 2022.

Benefits. We provide a competitive benefits program for our NEOs, including our CEO, in order to retain and attract an appropriate caliber of talent and recognize that other companies with which we compete for talent provide similar benefits to their executive officers.

The following table lists our current benefit programs and shows, for each, the employees eligible for each benefit:

Benefit Plan

Named Executive
Officers

Certain Managers
and Individual
Contributors

All
Full-Time
Employees

Retention and Retirement Arrangement

(1)

Supplemental ExecutiveRetirement Plan

(2)

Deferred Compensation Plan

(3)

Perquisites

(6)

401(k) Plan

Defined Benefit Pension Plan

(4)

Health Insurance

Life Insurance(5)

Bank-Owned Life Insurance(6)

(6)

Disability Insurance

(1)

In 2018 and 2022, the Committee approved retention and retirement payments of $1 million and $500,000, respectively, for Mr. Mayer. Mr. Mayer is able to invest the funds in a variety of investment options and assumes the risk of the investment. The 2018 payment amount of $1 million and any investment earnings will vest 100% in February 2023. The 2022 payment of $500,000 and any investment earnings will vest 25% per year over four years. The Committee approved those payments and terms as a retention tool for Mr. Mayer and in recognition that Mr. Mayer will be approaching a normal retirement age in the next few years.

(2)

Mr. Credle is a participant in the Supplemental Executive Retirement Plan. Due to their hire dates, the other NEOs are not participants in this Plan. Due to Mr. Credle’s separation from service on February 25, 2022, prior to the vesting requirements contained in the Plan, the benefit was forfeited.

(3)

The Company offers a nonqualified deferred compensation plan to approximately 15 members of its senior management, whereby the participant can elect to contribute, on a tax-deferred basis, a portion of his or her salary and/or cash bonus into the plan. The plan allows the participant to invest the funds into a variety of mutual fund options. The plan allows for matching or discretionary contributions to be made by the Company, but none have been made since the plan’s inception.

(4)

Our defined benefit pension plan covers all full-time employees hired on or before June 11, 2009. This plan was frozen as of December 31, 2012 for all participants, which means that no further benefits will be earned by participants.

(5)

The Company provides life insurance through a group life insurance policy that includes each employee that is not covered by a bank-owned life insurance policy and amounts to two times the employee’s base salary, subject to a cap of $300,000.

(6)

The Company has purchased single-premium bank-owned life insurance policies that insure the lives of many officers of the Company. For participating employees, life insurance benefits are two times the employee’s salary with no cap. In the event of death while employed by the Company, all proceeds from the life insurance that exceed two times the employee’s base salary are payable to the Company.

(7)

All employees are eligible to receive discounted interest rates on credit cards and overdraft protection, as well as reduced origination fees on home loans.

Supplemental Executive Retirement Plan

We sponsor a Supplemental Executive Retirement Plan (“SERP”) for the benefit of certain members of our senior management, which included Mr. Credle; however, he separated from service in February 2022 prior to being vested in the plan. Due to their hire dates our other NEOs are not participants in the SERP. The purpose of the SERP is to provide additional monthly pension benefits to ensure that each participant will receive lifetime pension benefits beyond the amounts that we can pay under our qualified pension plan. The SERP generally provides participants with an annual benefit at retirement equal to 3% of final average compensation multiplied by years of service, up to a maximum of 60% of final average compensation. The

amount of a participant’s SERP benefit is reduced by (i) the amount payable under our qualified pension plan, and (ii) 50% of the participant’s primary Social Security benefit.

We set the benefits payable under the SERP in 1993 at its inception, in consultation with an employee benefits consultant who assisted us with plan design. At that time, the employee benefits consultant provided peer information and gave his expert opinion that the benefits payable under this plan were reasonable and would further our objectives of attracting and retaining senior management executives.

During 2012, we decided to offer a uniform set of retirement benefits that would be applicable to all employees and not just those hired after June 11, 2009 or those who had achieved a certain level within the Company. Accordingly, effective December 31, 2012, in addition to freezing the qualified defined benefit pension plan (as noted above), we also froze our SERP, which means that the participants in the SERP do not earn future benefits under the SERP after that date. The SERP included a retention feature that penalized participants for leaving the Company prior to age 65 by reducing their earned benefit in a graduated manner that resulted in a lower penalty for each year of continued service. For the purposes of this feature, all participants were assumed to have been terminated from the Company on December 31, 2018.

Perquisites

We provide only very limited perquisites. None of our NEOs received in excess of $10,000 in perquisites during 2021.

Post-Termination Compensation

Accelerated Vesting

Our 2014 Equity Plan and the SERP have change in control provisions that automatically vest all participants in the benefits of each plan in the event of a change in control of our Company. We believe that other companies with which we compete for executive talent provide a similar acceleration benefit, and that these provisions therefore assist us in attracting and retaining talent.

Employment Agreements

We have entered into an employment agreement with each of our Other NEOs. The employment agreement with our CEO has been previously described. See “Compensation of Richard H. Moore, Chief Executive Officer” above.

The Other NEOs’ employment agreements provide for one year terms that renew annually unless either party gives written notice of non-renewal. Each of these agreements provides for the payment of certain severance benefits to the executive upon termination of employment in certain circumstances, including following a change in the control of our Company. For more information about these benefits, see the section below captioned “Executive Compensation — Potential Payments Upon Termination.” Each agreement also contains noncompetition and confidentiality covenants that protect our Company if the executive leaves.

The objectives of the Other NEO employment agreements are as follows:

•

The noncompetition covenant protects us by preventing an executive from leaving our Company and immediately joining a competitor, which could result in the executive taking business away from us;

•

The confidentiality covenant protects us by preventing an executive from disclosing trade secrets or confidential information regarding our Company or our customers for an extended period after the executive leaves his or her employment with the Company; and

•

The change in control severance payment provision benefits us by minimizing the uncertainty and distraction caused by the current climate of bank acquisitions, and by allowing our executive officers to focus on performance by providing transition assistance in the event of a change in control.

The Committee and the Board believe the amount of the severance benefits potentially payable to the Other NEOs under these agreements is reasonable and consistent with industry standards.

The above discussion describes the five primary components of our executive compensation program. The following section describes other guidelines and procedures affecting executive compensation.

Other Guidelines and Procedures Affecting Executive Compensation

Stock Option Grants

While we have not granted stock options in many years, when we approve a stock option grant, we set a date in the future as the measurement date for the exercise price of the stock option. We do not “back-date” stock option grants. We do not have a policy or practice of making stock option grants during periods in which there is material nonpublic information about our Company.

Tax Considerations

It has been and continues to be our intent that all incentive payments be deductible unless maintaining deductibility would undermine our ability to meet our primary compensation objectives or is otherwise not in the Company’s best interest. At this time, essentially all compensation we pay to the NEOs is deductible under the federal tax code.

Share Ownership Guidelines for Named Executive Officers

In February 2015, the Committee adopted a Stock Ownership and Retention Policy. This Policy required the CEO to own shares of the Company’s common stock with a value of at least two times his annual base salary and for all Other NEOs to own stock with a value equal to their base salaries. In February 2019, the Committee increased the CEO’s stock ownership requirement to be at least three times his base salary. NEOs who have not met the ownership requirements within five years of being subject to the Policy (i.e. becoming an NEO) are subject to restrictions on future stock sales until they are in compliance.

Additionally, in February 2017, the Committee modified the stock ownership guidelines for Mr. Moore and Mr. Mayer to require them to retain 50% of all shares of common stock they have been granted by the Company until retirement.

Hedging and Pledging Policy

It is the Board of Directors’ position that hedging and pledging transactions with respect to our common stock are inconsistent with shareholder objectives. Hedging transactions compromise the full risks and rewards of owning Company stock, and individuals who participate in such transactions may not be incented to improve the Company’s performance. Certain pledging commitments could also involve a sale of the Company’s stock without the individual’s consent at a time when the pledgor is aware of material nonpublic information or otherwise is not permitted to trade in the Company’s securities.

Accordingly, the Company has adopted a policy that prohibits:

•

Directly or indirectly engaging in hedging or monetization transactions, through transactions in Company stock or through the use of financial instruments designed for such purpose;

•

Engaging in short sale transactions of Company stock; and

•

Pledging Company stock as collateral for a loan, including through the use of traditional margin accounts with a broker, after the adoption of the Policy.

Consideration of Prior-Year Shareholder Advisory Vote

At the 2021 annual meeting of shareholders, on the proposal approving, on an advisory basis, the compensation paid to our NEOs as disclosed in the proxy statement for that annual meeting, 92% of the votes cast were cast in favor of the proposal (includes “shares abstained” as not being in favor and excludes “broker non-votes” from the percentage calculation). The Committee considered this high level of support as providing confirmation that the shareholders support our compensation policies and decisions for our NEOs, and determined that its approach to the 2022 compensation policies and decisions would remain generally consistent with the approach in 2021.

COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K of the Exchange Act. Based on its review and discussion, the Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement and in the Company’s Annual Report on Form 10-K for filing with the SEC.

Submitted by the Compensation Committee.

Daniel Blue, Jr.
Mary Clara Capel
James C. Crawford, III — Chair
Abby J. Donnelly
John B. Gould

Dexter V. Perry
O. Temple Sloan, III
Frederick L. Taylor, II
Virginia C. Thomasson
Dennis A. Wicker

Summary Compensation Table

The following table shows the compensation we paid in each of the last three fiscal years to the NEOs:

2021 SUMMARY COMPENSATION TABLE

Name and Principal Position	Year		Salary ($)		Bonus ($)(2)		Stock Awards ($)(3)		Option Awards ($)		Non-Equity Incentive Plan Compensation ($)(4)		Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)(5)		All Other Compens-ation ($)(6)		Total ($)
Richard H. Moore Chief Executive Officer		2021		466,346		100,000		674,320		—		199,320		—		47,262		1,487,248
		2020		408,654		—		541,840		—		141,840		—		27,576		1,119,910
		2019		400,000		—		509,440		—		109,440		—		33,080		1,051,960
Michael G. Mayer President of the Company and First Bank, Chief Exeutive Officer of First Bank		2021		616,346		150,000		603,937		—		228,938		—		45,717		1,644,938
		2020		558,654		75,000		488,510		—		158,510		—		36,455		1,317,129
		2019		544,230		—		392,700		—		117,700		—		29,007		1,083,637
Elizabeth B. Bostian(1) Executive Vice President, Chief Financial Officerand General Counsel of the Company and First Bank		2021		199,713		—		585,827		—		56,610		—		28,882		871,032
Gregory A. Currie, Jr.(1) Executive Vice President and Chief Banking Officer of First Bank		2021		352,885		42,000		625,000		—		54,000		—		34,556		1,108,441
Eric P. Credle Retired Executive Vice President and Chief Financial Officer		2021		383,755		—		77,175		—		179,895		—		25,735		666,560
		2020		367,500		—		140,899		—		67,400		148,000		24,020		747,819
		2019		365,481		9,949		133,500		—		55,051		139,000		22,258		725,239

(1)

Ms. Bostian and Mr. Currie became NEOs in 2021.

(2)

In recognition of the Company’s performance and the executive’s achievements during 2021, Mr. Moore was granted a $100,000 cash bonus, Mr. Mayer was granted a $150,000 cash bonus, and Mr. Currie was granted a $42,000 bonus to be paid half in cash and half in shares of Company stock that will vest in one-third increments at December 31, 2022, December 31, 2023 and December 31, 2024. These bonuses were awarded in February 2022 and were in addition to the bonuses paid under incentive plans.

(3)

The stock awards for 2021 relate to the following:

•

50% of the annual incentive award earned by each NEO. See the sections of the Compensation and Discussion Analysis above entitled “Performance Incentive Plan” for Mr. Moore and “Annual Incentive Plan” for the Other NEOs.

•

Ownership and retention-based stock grants made on July 27, 2021. See the section of the Compensation and Discussion Analysis above entitled “Equity Grants”.

•

Ownership and retention-based stock grants made on December 31, 2021 to Ms. Bostian and Mr. Currie. See the sections of the Compensation and Discussion Analysis above entitled “Long-Term Equity Grants”.

(4)

All amounts in this column were paid pursuant to the Performance Incentive Plan for Mr. Moore and the Annual Incentive Plan for the Other NEOs. See the Compensation and Discussion Analysis above for further discussion.

(5)

The amounts in this column reflect the annual change in the total actuarial net present value of the Mr. Credle’s accrued benefits under our pension plan and SERP but, in accordance with SEC instructions, with a minimum value of zero. The benefits under these plans have been frozen and thus,

changes in value are solely due to changes in the discount rate used to compute the present value of the benefit. Due to the freezing of these plans and the respective NEO hire dates, Mr. Credle is the only NEO that participates in these plans. The present value of Mr. Credle’s accrued benefits in these plans declined by $49,701 in 2021 due to increases in the discount rates used in the actuarial computations.

(6)

The following table shows the components of “All Other Compensation.”

	All Other Compensation
Name	Year		Defined Contribution Plan ($)		Club Dues ($)		Dividends on Restricted Stock(1) ($)		Life Insurance(2) ($)		Total ($)
Richard H. Moore		2021		17,400		—		28,231		1,631		47,262
		2020		13,376		—		12,725		1,475		27,576
		2019		16,500		—		15,261		1,319		33,080
Michael G. Mayer		2021		17,400		—		25,625		2,692		45,717
		2020		17,100		—		17,249		2,106		36,455
		2019		16,800		—		10,314		1,893		29,007
Elizabeth B. Bostian		2021		17,400		—		11,349		133		28,882
Gregory A. Currie, Jr.		2021		17,400		3,165		13,991		—		34,556
Eric P. Credle		2021		17,400		—		7,478		857		25,735
		2020		17,100		—		6,120		800		24,020
		2019		16,800		—		4,721		737		22,258

(1)

The amounts in this column represent the amount of cash dividends earned on shares of unvested restricted stock.

(2)

The amounts in this column represent the benefit associated with the life insurance provided by the bank-owned life insurance policies discussed in “Benefits” in the Compensation Discussion and Analysis section above.

We have entered into employment agreements with nine of our officers, including each of the NEOs. Each employment agreement provides for post-termination benefits. See “Potential Payments Upon Termination” below for more information about these potential benefits, and about the non-competition and confidentiality covenants contained in the agreements.

CEO Pay Ratio

The Compensation Committee monitors the relationship between the compensation of our executive officers and of our non-managerial employees. We disclose below the ratio of the pay of our CEO to our median employee (“pay ratio”). To determine the median employee, we considered 1,036 employees, which, except as noted in the following sentence, included all full-time and part-time employees, with the exception of the CEO, as of December 31, 2021. In this analysis, we excluded employees that joined our Company on October 15, 2021 as a result of our acquisition of Select Bancorp. We determined the median employee based on W-2 earnings for 2021. For employees hired during 2021, we converted their earnings to an annualized amount. No full-time equivalent adjustments were made for part-time or temporary employees.

For purposes of determining the pay ratio, the total compensation of our CEO includes all compensation reported in the Summary Compensation Table. The total compensation of the median employee was determined in the same manner as was used for the CEO in the Summary Compensation Table.

Median Annual Total Compensation of All Employees:	$	56,251
Total Annual Compensation of CEO:	$	1,487,248
Pay Ratio:		26.4

Grants of Plan-Based Awards

The amounts shown in the table below relate to (i) the range of possible non-equity and equity payouts in 2022 for 2021 performance under the Performance Incentive Plan for Mr. Moore and the Annual Incentive Plan for Other NEOs, (ii) grants of stock made to each NEO in July 2021 to promote share ownership and management retention, and (iii) grants of stock made to Ms. Bostian and Mr. Currie in December 2021 to promote share ownership and management retention and in recognition of their increased responsibilities.

Under both incentive plans, we pay cash bonuses within the first 75 days following year end based on corporate performance in the preceding fiscal year. Under the Performance Incentive Plan, Mr. Moore’s bonus is payable in an equal mix of cash and restricted stock, while payments under the Annual Incentive Plan can be paid in cash or restricted stock or a mix of the two. In February 2022, the Compensation Committee determined that 15 members of senior management, including each Other NEO except for Mr. Credle because of his impending retirement, would be paid their awards in a mix of 50% cash and 50% restricted stock. Mr. Credle was paid his bonus solely in cash.

	Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1)						Estimated Future Payouts Under Equity Incentive Plan Awards(2)						All Other Stock Awards: Number of Shares of stock or Units (#)(3)		Grant Date Fair Value of Stock and Option Awards ($)(4)
Name	Threshold ($)		Target ($)		Maximum ($)		Threshold (#)		Target (#)		Maximum (#)				Grant Date Fair Value of Stock and Option Awards ($)(4)
Richard H. Moore		60,000		120,000		240,000		1,308		2,616		5,231		12,245		475,000
Michael G. Mayer		85,938		171,875		257,813		1,873		3,746		5,619		9,667		375,000
Elizabeth B. Bostian		21,250		42,500		63,750		463		926		1,389		11,689		529,217
Gregory A. Currie, Jr.		23,438		46,875		70,313		511		1,022		1,533		12,766		571,000
Eric P. Credle		33,764		67,528		101,292		736

SEC Form DEF 14A filed by First Bancorp