Auburn National Bancorporation Inc.
04/02/2026 | Press release | Distributed by Public on 04/02/2026 10:50
Proxy Statement (Form DEF 14A)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant
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Filed by a party other than the Registrant
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Check the appropriate box:
☐
Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permittedby 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 Pursuant to §240.14a-12
AUBURN NATIONAL BANCORPORATION, INC.
(Name of Registrant as Specified in its Charter)
Not applicable.
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check all boxes that apply):
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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) perExchange Act Rules 14a-6(i)(1) and 0-11.
April 2, 2026
TO OUR SHAREHOLDERS:
Youare cordially invitedto attend the AnnualMeeting of Shareholdersof Auburn National Bancorporation,Inc., to
be heldat theAuburnBank Center,100 NorthGay Street,Auburn, Alabama,on May12, 2026,at 3:00P.M.,local
time (collectively, withany adjournments or postponements thereof, the "Meeting").
The Noticeof Meeting,Proxy Statementand Proxyare enclosed.Wehope youcan attendand voteyour sharesin
person.Inanycase,pleasecompletetheenclosedProxyandreturnittous.Thisactionwillensurethatyour
preferences will be expressed on the matters that are being considered.If you attend the Meeting, you may vote your
shares in person even if you have previously returned your Proxy.
Prior to themeeting, a receptionwill be heldfrom 2:30 p.m.to 3:00 p.m.in the AuburnBankCenter.Wehope you
can join us!
Wethank you foryour support thispast year,and we encourageyou to reviewour Annual Report.If you haveany
questions about the Proxy Statement or the Annual Report, please call or write us.
Sincerely,
/s/ Robert W. Dumas
Robert W.Dumas
Chairman of the Board
AUBURN NATIONALBANCORPORATION,INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY12, 2026
Notice is herebygiven that the2026 AnnualMeeting of Shareholdersof Auburn NationalBancorporation, Inc.(the
"Company") will beheld at the AuburnBankCenter, 100North Gay Street,Auburn, Alabama onTuesday,May 12,
2026, at 3:00 P.M.,local time (collectively, with any adjournments or postponementsthereof, the "Meeting"), for the
following purposes:
1.
Election of Directors
.To elect 12 nomineesto serve on the Board of Directors for a one-year term;
2.
AdvisoryVoteonExecutiveCompensation
.Toapprove,onanon-binding,advisorybasis,the
compensationoftheCompany's"namedexecutiveofficers"as disclosedintheproxystatement that
accompanies this notice;
3.
Ratification ofIndependent RegisteredPublic Accountants
. Toratify theappointment ofElliott Davis
LLC asthe independentregisteredpublicaccountingfirm ofthe Companyfor thefiscal yearending
December 31, 2026; and
4.
Other Business
. To transact suchother business as may properly come before the Meeting.
Only shareholdersof recordat theclose ofbusiness onMarch 23,2026, areentitled tonotice ofand tovote atthe
Meeting. All shareholders, whether ornot they expect toattend the Meeting inperson, are requested tocomplete, date,
sign and return the enclosed Proxy in the accompanying envelope.
By Order of the Board of Directors,
/s/ C. Wayne Alderman
C. Wayne Alderman
Secretary
April 2, 2026
PLEASE COMPLETE,DATE,AND SIGNTHE ENCLOSEDPROXY ANDRETURN ITPROMPTLYTO THE
TRANSFER AGENT IN THEENVELOPE PROVIDED, EVEN IFYOU PLAN TO ATTENDTHE MEETING IN
PERSON.IF YOU ATTENDTHE MEETING, YOU MAY VOTE IN PERSON BY WRITTEN BALLOT IF YOU
WISH, EVEN IF YOU HAVEPREVIOUSLYRETURNED YOUR PROXY.
IMPORTANTNOTICE REGARDING THE AVAILABILITYOF PROXY MATERIALSFOR THE
SHAREHOLDER MEETING TO BE HELD ON TUESDAY,MAY 12,2026
THE PROXY STATEMENTAND ANNUAL REPORT TO SHAREHOLDERS
ON SECURITIES AND EXCHANGE COMMISSION FORM 10-K,INCLUDING EXHIBITS, ARE
AVAILABLEFREE OF CHARGES ATWWW.AUBNPROXY.COM
AND OUR COMPANY'SWEBSITE WWW.AUBURNBANK.COM
2
If you area beneficial ownerof shares ofCompany common stock,you should receivea Noticeof Internet Availability
of Proxy Materialsor voting instructionsfrom any brokeror other nomineeholding your shares.Youshould follow
the instructions inthe Notice or thevoting instructions providedby your broker ornominee in orderto instruct your
broker or nominee on how to vote your shares.Shares held beneficially through a broker or nominee may be voted at
the Meeting only if you obtain a legal proxy from the broker or nomineegiving you the right to vote the shares.
Proposals to be VotedOn; Board Recommendations
Proposal
Description of Proposal
Board Recommendation
For more information
Proposal 1
Theelectionofall12nomineesfor
election as directors
"FOR" all nominees
Page 6
Proposal 2
Anon-binding,advisoryvoteonthe
compensationoftheCompany's
"named executiveofficers" (the'say-
on-pay"
"FOR"
Page 17
Proposal 3
ToratifytheappointmentofElliott
DavisLLCastheindependent
registeredpublicaccountantsforthe
Companyforthefiscalyearending
December 31, 2026
"FOR"
Page 29
YOUR VOTE IS IMPORTANT
Yourvote is importantand it iseasy to vote.Youcan vote online,by phone orby completing, signingand mailing
the enclosed proxy card.Even if you plan to attend the Meeting in person, please cast your vote as soon as possible.
The voting deadline is 1:00 A.M., Central Time,on May 12, 2026.
If theMeeting isadjourned orpostponed, yourproxy willstill beeffectiveand willbe votedat therescheduled or
adjourned Meeting. Youwill still be able to change or revoke your proxy until the rescheduled or adjourned Meeting.
AVAILABILITYOF ANNUAL REPORT
Copies ofthe Company's2025 AnnualReport onSEC Form10-K canalso befound byclicking theheading "Our
Story" on theCompany's website,
www.auburnbank.com,
and then clickingon "Investor Relations",and then clicking
on"Financials-SECFilings".UponthewrittenrequestofanypersonwhoseProxyissolicitedbythisProxy
Statement, theCompanywill furnishto suchperson withoutcharge(other thanfor exhibits)a copyof theAnnual
Report, including financial statements and schedules thereto, as filed with the SEC.Such requests should be directed
to Luellen Bishop, ShareholderRelations, Auburn National Bancorporation,Inc., P.O.Box 3110, Auburn,Alabama,
36831-3110 or by emailing: [email protected].
REQUESTS FOR A COPY OF THE ANNUAL REPORT(WITHOUT EXHIBITS) FROM THE
COMPANY BEFORETHE ANNUAL MEETING MUST BE RECEIVED BY THECOMPANY NOT
LATER THAN APRIL25, 2026, OTHERWISE YOU MAYNOT RECEIVE SUCH REPORT PRIORTO
THE MEETING.
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PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
OF
AUBURN NATIONALBANCORPORATION,INC.
TO BE HELD MAY12, 2026
General
This Proxy Statementis being furnishedto shareholders ofAuburn National Bancorporation,Inc. (the "Company"),
aDelawarecorporationregisteredas abankholdingcompanyundertheBank HoldingCompanyActof 1956,as
amended (the "BHC Act"), inconnection with the solicitationof proxies by theCompany's Boardof Directors from
holders of theoutstanding shares ofthe Company's$.01 par valueCommon Stock ("CommonStock") for the2026
AnnualMeetingofShareholdersoftheCompany(collectively,withanyadjournmentsorpostponements,the
"Meeting").Unlessthecontextotherwiserequires,theterm"Company"includestheCompany'ssubsidiary,
AuburnBank (the "Bank").The Company's Common Stock is listed on the Nasdaq GlobalMarket under the symbol
"AUBN,"anditsprincipalexecutiveofficesarelocatedat100N.GayStreet,Auburn,Alabama36830,andits
telephone number is (334) 821-9200.The Company maintains an internet website at www.auburnbank.com.
The Meetingis beingheld toconsider andvote upon:(i) theelection of12 nomineesto theBoard ofDirectors for
one-year terms; (ii) on a non-binding, advisory basis, the compensation of theCompany's "named executive officers"
(defined below) asdisclosed in thisProxy Statement (a"say-on-pay proposal"); (iii) theratification of theappointment
of ElliottDavis LLC("Elliott Davis")as theindependent registeredpublic accountingfirm ofthe Companyfor the
fiscal year ending December 31, 2026; and (iv) such other matters as may properlycome before the Meeting.
The Company's Board of Directors knows of no business that will bepresented for consideration at the Meeting other
than the matters described in this Proxy Statement.
This Proxy Statementand the Proxyare first being providedon or aboutApril 2, 2026,to Company shareholdersof
record as of the close of business on March 23, 2026 (the "RecordDate").The Company's 2025 Annual Report(the
"AnnualReport"),includingfinancialstatementsforthefiscalyearendedDecember31,2025,canbefoundby
clicking the heading"Our Story" onthe Company'swebsite, www.auburnbank.com,and then clickingon "Investor
Relations", and then clicking on "Financials - SEC Filings".
Each shareholder is entitled to one voteon each proposal for eachshare of Common Stock held asof the Record Date.
In determiningwhether aquorum exists atthe Meetingfor purposesof all mattersto be votedon, all votes"for" or
"against," as well as all abstentions (including votes to withhold authority to vote in certain cases), will be counted as
shares present,and aquorum will existif amajority ofthe sharesissued andoutstanding andentitled tovote atthe
meeting are present or represented by proxy.
Under Delaware law, the vote required for the election of directors is aplurality of the votes cast by the sharespresent
or represented by proxy, at the Meeting and entitled to vote on the election of directors, provided a quorum is present.
Consequently,with respect to the election ofdirectors, "withhold" votes and brokernon-votes will not be countedin
determining whetherthe directorhas receivedthe requisite numberof votes forapproval as theyare not considered
votes cast.All other proposals require the affirmativevote of the majority of shares present or represented byproxy,
andentitledtovoteattheMeeting(meaningthatofthesharesrepresentedatthemeetingandentitledtovote,a
majority of themmust be voted "for"the proposal for itto be approved).Abstentions will havethe same effectas a
vote "against"the proposal,and broker non-voteswill not becounted in determiningwhether the proposalreceived
the requisite number of votes for approval.
4
A "broker non-vote"occurs when a broker,dealer, bank,or voting trustee ortheir nominee who canbe identified as
a record holder of Common Stock holdingshares in "street name" for a beneficialowner of Common Stock does not
vote ona particularproposal becausethe recordholder doesnot havediscretionary votingpower forthat particular
item and hasnot receivedvoting instructionsfrom the beneficialowner.Brokers (and othersimilar recordholders)
thathavenotreceivedvotinginstructionsfromtheirclientscannotvoteontheirclients'behalfon"nonroutine
matters."All mattersto beconsidered atthe Meetingare "non-routine,"except brokerslacking votinginstructions
from the beneficial owners,may vote onratification of theappointment of ElliottDavis as theCompany's independent
registered publicaccounting firm.Broker voteson theratification ofthe auditorsare "brokerdiscretionary votes,"
and may be counted in meeting the quorum requirements.
UnlessotherwiserequiredbytheCompany'sCertificateofIncorporationorAmendedandRestatedBylaws
("Bylaws"), or by the Delaware General Corporation Law or other applicable law,any other proposal that is properly
brought before the Meeting will require the affirmative vote of themajority of shares present or represented by proxy,
andentitledtovoteattheMeeting(meaningthatofthesharesrepresentedatthemeetingandentitledtovote,a
majorityofthemmustbevoted"for"theproposalforittobeapproved).Withrespecttoanysuchproposal,
abstentions willhave thesame effectas avote "against"the proposal,and brokernon-votes willnot becounted in
determining whether such proposal has received the requisite number of votes for approval.
Asummaryofthevotingprovisions,providedavalidquorumispresentorrepresentedattheMeeting,forthe
proposals to be considered at the Meeting are below:
Proposal
Board Voting
Recommendation
Voting Standard
Effect of "ABSTAIN" Votes and Broker Non-Votes
Proposal 1
Election of
Directors
FOR
The nominee is elected
by a "plurality vote,"
which means the
nominee is elected if the
number of votes "FOR"
the nominee exceeds the
"WITHOLD" votes for
such nominee
"ABSTAIN" votes andbroker non-votes will
not be considered votes cast and will have no
effect on the outcome of the election
All other
proposals,
including
Proposal 2 and
Proposal 3
FOR
A majority of shares
present in person or by
proxy and entitled to
vote at the Meeting is
required for approval of
these Proposals
"ABSTAIN" votescounts as a vote
"AGAINST" the proposal.Broker non-votes
have no effect on the outcome of these
proposals.
Record Date, Solicitation and Revocability of Proxies
The Record Date for the Meeting has been set as the close of business on March23, 2026. Accordingly,only holders
of recordof sharesof CommonStock onthe RecordDate willbe entitledto voteat theMeeting.At theclose of
business on suchdate, there wereapproximately 3,495,866shares of CommonStock issued andoutstanding, which
were held by approximately 320 shareholders of record.
5
SharesofCommonStockrepresentedbyaproperlyexecutedProxy,ifsuchProxyisreceivedintimeandisnot
revoked, will bevoted at theMeeting inaccordance withthe instructionsindicated insuch Proxy.
If you properly
execute and return your Proxy but do not indicate any voting instructions with respectto one or more matters
tobevoteduponattheMeeting,orifyourvotinginstructionsareunclear,yourshareswillbevotedin
accordance with the recommendation of the Board of Directors as to all such matters. Specifically, your shares
will be voted FOR the election of alldirector nominees, FOR the advisory approval of the say-on-pay proposal,
and FOR theratification ofthe appointmentof Elliott Davisas the independentregisteredpublic accounting
firm of the Company for the fiscal year ending December 31, 2026; and in the discretionof the persons named
as proxies on all other matters, if any,that may properly come before the Meeting.
A shareholder who has given a Proxy may revoke it at any time prior toits exercise at the Meeting by either (i) giving
written noticeof revocationto theCompany'sSecretary,(ii) properlysubmittingto theCompanya dulyexecuted
Proxybearingalater date,or (iii)appearingin personatthe Meetingand votingin personby writtenballot.All
written noticesof revocationor othercommunications withrespect torevocation ofProxies shouldbe addressedas
follows: Auburn National Bancorporation, Inc., P.O.Box 3110, Auburn, Alabama 36831-3110,Attention: C. Wayne
Alderman, Secretary.
Proxy Solicitation Costs
The cost of soliciting Proxies for the Meeting will be paid by the Company.The Company's officersmay also solicit
proxies by telephone or otherwise, but will not receive additional compensation for these activities.In addition to the
solicitation of shareholders of record by mail, telephone, facsimile, email, or personal contact, the Company may also
make arrangements with brokers, dealers, banks, orvoting trustees or their nominees who can be identifiedas record
holdersofCommonStocktoforwardthisproxystatementandthe2025AnnualReporttobeneficialownersof
CommonStock.The Companywill reimbursesuch third-partiesfortheir reasonableexpenses inconnectionwith
these services.
6
PROPOSAL ONE: ELECTION OF DIRECTORS
General
Twelvepersons havebeen nominatedto serveon theCompany'sBoard ofDirectors forone-year termsexpiring at
theCompany'snextscheduledannualmeetingofshareholdersanduntiltheirsuccessorshavebeenelectedand
qualified.All the nominees for director are current directors of the Company, and all have agreed to serve, if elected.
Proxies cannot be voted for more than the 12 nominees.Cumulative voting for directors is not permitted.All shares
represented by valid Proxies received and not revoked before they are exercised will be voted in the manner specified
therein.If no specification is made, the Proxies will be voted forthe election of all 12 nominees listed below.In the
unanticipated eventthat any nomineeis unableto serve,the personsdesignated asproxy holderswill castvotes for
the remaining nominees and for such other replacements as may be nominated by the Company'sBoard of Directors.
Nomineesfordirectorsareelected ifthenomineereceivesmorevotes"FOR" thenomineethan"AGAINST"the
nominee.
The nominees have been nominated by the Company's Board ofDirectors based on the recommendation of the
Nominating and Corporate Governance Committee, andthe Board unanimously recommends you vote"FOR"
the election of all 12 nominees listed below.
Information about Nominees for Directors and Executive Officers
The following table sets forth the nameand age of each nominee fordirector, a brief description of his or herprincipal
occupationand businessexperience,certain otherdirectorships andhow longhe orshe hasbeen adirectorfor the
Company or the Bank.In addition, we have also provideda brief discussion of thespecific experience, qualifications,
attributes orskills thatled tothe Nominatingand CorporateGovernance Committee'sconclusion thatthe nominee
should serve asone ofour directors.Except forRobert W. Dumas, Chairmanof theBoard ofDirectors ofthe Company
andthe Bankand DavidA. Hedges,PresidentandCEO ofthe Companyand theBank, noneof thenominees are
employed by the Company or the Bank or any entity that is an affiliateof the Company or the Bank.
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Name, Principal Occupation, Business Experience, Age, Directorshipsand Qualifications
Director
Since
C. Wayne Alderman
2004
DeanandProfessorEmeritus,formerDeanofEnrollmentServicesandformerDean,Collegeof
Business, Auburn University; former Director ofFinancial Operations of theBank from 2000 to2007;
employed by Auburn University from 1979 to 2022.Dr. Alderman is 75.
Dr. Alderman, a certified publicaccountant and former Torchmark Professor of Accountingat Auburn
University,hasstrategicplanningexpertise,publicaccountingandriskandgeneralmanagement
knowledge to the Board.He also hasvaluable insight and bankingknowledge as a resultof his service
as the Bank's Director of Financial Operationsfrom 2000 to 2007, in addition to serving as a director
of the Bank since 1993.
Terry W.Andrus
1998
Retired President andChief Executive Officerof the EastAlabama Medical Centerfrom 1984 to2018;
Directorof CareNetworkSoutheast, FormerDirector ofBlue Cross/BlueShield ofAlabama.Mr.
Andrus is 74.
Mr. Andrushas executive decision-making,financial expertise, and business-buildingskills from his
pastserviceastheChiefExecutiveOfficerofaregionalhospital.Mr.Andrusalsohasservedas
Chairman of the Alabama HospitalAssociation.He possesses banking knowledge through hisservice
as a director of the Bank since 1991.
J. TuttBarrett
2010
Mr. Barrett is a senior partnerin the law firm of Dean & Barrett, located in Opelika,Alabama, where
he has worked since 1992. Mr. Barrett is 74.
Mr.BarrettbringsawealthoflegalandriskmanagementskillstotheBoard.Healsoprovides
governanceskillsandexperiencegainedthroughhisserviceontheboardsofvariouscharitable
organizations. Inaddition, Mr.Barrett servedon one ofthe Bank'slocal advisoryboards from 1991
to 2010.
Walton T.Conn, Jr.
2025
Mr.ConnservedasGlobalChiefOperatingOfficer-Quality,Risk&RegulatoryforKPMG
International from 2015 until his retirement in 2023.Prior to this, he served as Global Head of Audit
MethodologyandImplementation(2008-2015)andvariousotherrolesduringhis38yearswith
KPMG and its predecessors. Mr.Conn is 63.
Mr.Connhasvaluableexecutive-decisionmakingandriskmanagementskills,publicaccounting
knowledge, and corporategovernance expertise fromhis career withKPMG, LLP, a global accounting
firm.
8
Name, Principal Occupation, Business Experience, Age, Directorshipsand Qualifications
Director
Since
Robert W.Dumas
2001
Chairman of theBoard of the Companyand the Bank sinceJanuary 2020; Presidentand CEO of the
Companyfrom 2017to December31, 2022andtheBank from2001toDecember 31,2022;Vice
Chairman of the Companyand the Bank from 2013until his election as theChairman; President and
Chief Lending Officer of the Bankfrom 1998 to 2001. Hehas been employed by theBank since 1984;
and is a Director of East Alabama Medical Center.Mr. Dumas is 72.
Mr.DumasbringsvaluableinsightandknowledgetotheBoardasaresultofhispriorserviceas
President and CEO of the Company and theBank.Mr. Dumas currently serves as a trustee or director
of the AuburnUniversity Board ofTrustees, the Auburn Researchand Technology Board of Directors,
and servedon the Boardof Directorsof theAlabama BankersAssociation, andthe Federal Reserve
Bank of Atlanta.He has held numerousother professional leadershippositions, including his service
asPresidentandChairmanoftheAlabamaBankersAssociationandamemberoftheAuburn
UniversityBusinessAdvisoryCouncil.Mr.Dumashasvaluableknowledgefromhis47yearsof
service in the banking industry,including serving as a director of the Bank since 1997.
Jeffrey J. Evans
2026
PresidentandChiefExecutiveOfficerofbothEvansRealty,apropertymanagementcompany
specializinginmulti-familyapartmentcommunities,andJ&LContractors,acommercial
construction company.Mr.Evans hasserved in theseroles since2021 and1998, respectively.Mr.
Evans is 56.
Mr. Evans brings a variety ofexecutive decision-making and riskassessment skills from over 30years
of experience inproperty management andconstruction in the Company'smarkets.His background
is especially importantgiven the compositionof our loanportfolio, much ofwhich is realestate driven.
William F.Ham, Jr.
2004
FormerMayorofCityofAuburnfrom1998to2018;ownerofVarsityEnterprises,acompany
providing coin laundry services, since 1977.Mr. Ham is 72.
Mr. Ham brings awealth of business-buildingskills and communityknowledge to theBoard as aresult
of his experience as an entrepreneur and asthe former Mayor of City ofAuburn.He also has valuable
knowledge through his service as a director of the Bank since 1993.
David A. Hedges
2022
President and Chief Executive Officer of theCompany and the Bank since January 1, 2023; formerly
Executive VicePresident and Chief FinancialOfficer of the Companyand the Bank since December
2015; and various other positions with the Company and Bank since 2006.Mr. Hedges is 47.
Mr. Hedges brings valuable knowledgeand insight to the Board as a result of his service as President
and CEO ofthe Company andthe Bank andhis prior serviceas ExecutiveVicePresident and Chief
Financial Officerof theCompany andthe Bank.Mr.Hedges currentlyserves onthe East Alabama
Medical CenterFoundation Boardof Directors,Auburn Chamberof CommerceBoard of Directors,
andontheAmericanBankersAssociationCommunityBankersCouncil.Priortojoiningthe
Company,Mr. Hedgesworked at KPMGLLP in theirfinancial services auditpractice from 2002to
2006.
9
Name, Principal Occupation, Business Experience, Age, Directorshipsand Qualifications
Director
Since
David E. Housel
2004
DirectorofAthleticsEmeritusatAuburnUniversitysinceJanuary2006;DirectorofAthleticsat
Auburn University from 1994 to January 2006. He was employed by Auburn University from 1970 to
2006.Mr. Housel is 79.
Mr.Houselbringsvaluablebusiness,publicrelations,andstrategicplanningskillstotheBoard
throughhispreviousexperiencemanagingamajorcollegiateathleticprogramwithnumerous
employeesandsupervisingmulti-milliondollarbudgets.Healsopossessesbankingknowledge
through his service as a director of the Bank since 1997.
Michael A. Lawler
2024
FounderandChiefExecutiveOfficerofFullsteamHoldingsLLC("Fullsteam")sinceApril2018;
formerly President -Strategic Markets Groupand executive officerfor Heartland Payment Systems,
Inc. from 2012 until its sale toGlobal Payment System Inc. in 2016. After the sale,Mr. Lawler briefly
retired before discussions that led to the formation of Fullsteam.Mr. Lawler is 63.
Mr.Lawlerhasexecutivedecision-making,strategicplanning,andbusiness-buildingskillsasthe
founder and Chief Executive Officer of Fullsteam and previously as an executive officer of Heartland
PaymentSystems.He alsopossesses valuableinsight regardingthe intersectionof technologyand
payments for a variety of small business industry verticals and as a vendor to banks.
Anne M. May
1990
Retired Partner,Machen & McChesney,LLP,an accounting firmlocated in Auburn, Alabama,from
1983 to 2018.Ms. May is 75.
Ms.Mayhasvaluableriskmanagementskills,publicaccountingknowledgeandexpertisein
compensationand taxcompliance asa partnerand formermanagingpartner fora localaccounting
firm.She also possesses extensivebanking knowledge throughher service as adirector of theBank
since 1982.
Sandra J. Spencer
2024
RetiredfromAuburnUniversity;wheresheservedasDirectorfortheAlabama4-HYouth
Development and Conference Center in Columbiana, Alabama from 2000 to 2014. Ms. Spencer is66.
Ms. Spencer hasvaluable business insights andexpertise from over 25years working in thehospitality
industry.She alsopossesses awealth ofcommunity knowledgefrom herservice anddedication to
local philanthropicefforts, includingChapter A, P.E.O.,a philanthropic organizationfocused on the
education and advancement of women.
10
CORPORATE GOVERNANCE
Board Leadership Structure
Robert W.Dumas servesas Chairmanof theCompany andthe Bank,and previouslywas Chairman,President and
CEO of the Company and the Bank through December 31, 2022.
The Board of Directors does not have a policy with respect to the separation of the offices of Chairman and the Chief
Executive Officer. The Board believes that it is in the best interests of the Company and our shareholders to retain the
flexibility to combine or separate these functions.
Althoughcurrentlyseparated,theBoardbelievesthatcombiningthepositionsofChairmanandChiefExecutive
Officerwould notadversely affectthe Board'sindependence. TheCompany'sBoard iscomprisedof 12directors.
NinedirectorshavebeendeterminedtobeindependentunderNasdaq'slistingstandards.Ourtwomanagement
directors andMr.Evans arethe onlynon-independent directors.Our corporategovernance guidelinesprovide that
the independent directors will meet at least semi-annually in executivesession without management present.
AnneM.May isformallyidentifiedastheleadindependentdirector.Theleadindependentdirectorhasbroad
responsibility and authority,including to:
●
Preside at all meetings of the Boardat which the Chairman is notpresent, including executive sessions of the
independent directors;
●
Call meetings of independent directors; and
●
Serve as the principal liaison between the Chairman and the independentdirectors.
TheCompanybelievestheforegoingstructure,combinedwiththeCompany'sothergovernancepoliciesand
procedures,provideappropriateoversight,discussionandevaluationofdecisionsanddirectionfromthe Boardof
Directors.
11
Board's Role in Risk Oversight
TheBoardofDirectorsmaintainsoversightresponsibilityofthemanagementoftheCompany'srisks.Risk
managementincludesunderstandingtheriskstotheCompany,theactionsneededtomanagethoserisks,and
determiningacceptablelevelsofriskfortheCompany.ThefullBoardofDirectorsreviewsenterpriserisk
managementthrough orwith theCompany'sandthe Bank'sBoardcommitteesandmanagementcommittees, and
with management.
WhiletheBoardofDirectorsmaintainstheultimateoversightresponsibilityforriskmanagement,thefollowing
committees have these responsibilities for risk management oversight:
•
The Compensation Committee evaluates,with our seniorofficers, risks posed byour compensation programs
andseekstoavoidcompensationthatmaypromoteunnecessaryorexcessiverisks,andwhichdoesnot
rewardperformanceinconsistentwithapplicablelaws.TheCompensationCommittee'sroleandits
relationshipwiththeBoardaremorefullydescribedunder"CommitteesoftheBoard-Compensation
Committee."
•
TheAuditCommitteeoverseesrisksrelatedtoourfinancialstatements,ourcompliancewithlegaland
regulatory requirements,including transactionswith insidersand affiliates,our financialreporting process
and system ofinternal controls.The AuditCommittee alsoappoints andevaluates the performanceof our
independentauditorsandourinternalauditingdepartment.TheAuditCommitteeperiodicallymeets
privately in separateexecutive sessions withmanagement, our internal auditdepartment, and theindependent
auditors.The AuditCommittee'srole andits relationshipwith theBoard aremore fullydescribed under
"Committees of the Board - Audit Committee."
While each of these committees is responsible for evaluatingand overseeing the management of these risks, theentire
BoardofDirectorsisinformedthroughcommitteereportsaboutsuchrisks.Inaddition,eachoftheCompany's
directors serves on the Bank's Board of Directors.We believe that Board committees that report at the Bank level are
critical totheCompany'srisk managementprocesses.Thesecommitteesincludethe Director'sLoanCommittee,
Asset/LiabilityCommittee,InformationTechnology/InformationSecurity("IT/IS")SteeringCommittee,and
OperationsandBankSecrecyAct("BSA")Committee.Thesecommitteeseachplayaroleinmonitoringthe
followingriskstotheBankandCompany:credit,liquidity,interestrate,anti-moneylaunderingandsanctions
compliance,generalcompliance,andoperational,reputationalandinformationtechnologyandsystemssecurity,
including cybersecurity risks.
Director Nominating Process
The Nominatingand CorporateGovernanceCommittee, inconsultationwith theChairmanof theBoard, monitors
existing director qualificationsand periodically examinesthe composition ofthe Company'sBoard of Directorsand
determines whether the Board of Directors would better serve its purposes with the addition of one or more directors.
This assessment includes, among other relevantfactors, in the context ofthe perceived needs ofthe Board at that time,
including experience and relevant knowledge, reputation, judgment, diversityand skills.
If theNominating andCorporate GovernanceCommittee determinesthat addinga newdirector isadvisable orif a
vacancy on the Boardarises or isexpected, the Nominating andCorporate Governance Committee initiatesthe search,
and collaborates withthe other directorsand management.This Committee mayretain a searchfirm to assistin the
search,if theCommitteedeterminesthis isnecessaryor appropriate.The NominatingandCorporateGovernance
Committee will consider all appropriate candidates proposed bymanagement, directors and shareholders.
12
Informationregardingpotentialcandidatesis presentedtotheNominatingandCorporateGovernanceCommittee,
which then evaluates the candidates based on the needs of the Board of Directors at that time. Nominees for directors
areconsideredonthebasisofvariousfactors,includingtheircharacter,experience,skills,andknowledgeofour
communities. Weseek a Board of Directorswith a majority of independentdirectors with a range ofcomplementary
experiencesandperspectives,includingpersonswiththeexpertiseandqualificationsrequiredbyourAuditand
Compensation Committees.Potential candidatesare evaluatedaccording tothe samecriteria, regardlessof whether
the candidatewas recommendedby theNominating andCorporate GovernanceCommittee, ashareholder,another
director,management oranother thirdparty.The Nominatingand CorporateGovernance Committeethen meetsto
considerthecandidate(s)andrecommendscandidate(s)tothefullBoardofDirectorsforapprovaland
recommendation to the shareholders as nominees for director.
The director nomination processis designed sothat the Boardconsiders members with diversebackgrounds, including
race,ethnicity,gender,education,skillsandexperience,withafocusonappropriatefinancialandotherexpertise
relevanttotheCompany'sbusinessandknowledgeofthecommunitiesweserve.Thenominationprocessalso
considersissuesofjudgment,independence,conflictsofinterest,integrity,ethicsandcommitmenttothegoalof
maximizingshareholdervalue.TheBoardandtheNominatingandCorporateGovernanceCommittee'sgoalwith
regard to the consideration of diversity in identifying director nominees is to assemble a group of directors with deep,
varied experiences and perspectives, sound judgment and commitment tothe Company's success.
Shareholder Nominations
Subject to the requirements ofthe Company's Certificate of Incorporation and Amended andRestated Bylaws, as well
as any requirements of lawor regulation, any shareholder entitled tovote for the election ofdirectors may recommend
a directornominee. TheNominating andCorporate GovernanceCommittee willconsider shareholdernominees as
described under "DirectorNominating Process"immediately above, butin theabsence of anyshareholder nominations
historically,currently hasno formalpolicy.Advance noticeof suchproposed nominationmust bereceived bythe
Secretary of the Company not less than 21 days nor more than 60 days prior toany meeting of the shareholders called
for the election of directors.Nominations should be submitted in writing to the Secretary of the Company specifying
thenominee'snameand otherrequiredinformationset forthin theCompany'sBylaws.No shareholdernominee
recommendations have been receivedwith respect to the AnnualMeeting, and no third-partysearch firms were used
in 2025 to identify director candidates.
Code of Conduct and Ethics
The Board of Directors has adopted a Code of Conduct and Ethics applicable to all Company's directors, officers and
employees.TheCodeofConductandEthics,aswellasthechartersfortheAuditCommittee,Compensation
Committee, andthe Nominatingand CorporateGovernance Committee,can befound by clickingthe heading"Our
Story" on the Company's website,
www.auburnbank.com
, and then clicking on"Investor Relations" and then clicking
on"Governance-GovernanceDocuments."TheCompanypostsanyamendmentstoorwaiversofitsCodeof
Conduct andEthics atthis locationon theCompany'swebsite.Any shareholdermay makea writtenrequest fora
copyoftheCompany'sCodeofConductortheAuditCommittee,CompensationCommittee,orNominatingand
CorporateGovernanceCommitteecharterstoAuburnNationalBancorporation,Inc.,100N.GayStreet,Auburn,
Alabama 36830, Attention: MarlaKickliter, SeniorVice President ofCompliance and Internal Audit.Requests may
also be made via telephoneby contacting Ms. Kickliter orTamela Seymour, Chief Human Resources Officer, at (334)
821-9200.As additional corporategovernance standards areadopted, they willbe disclosed onan ongoing basis on
the Company's website.
13
Insider Trading Policy
The
Company
maintains
anInsiderTradingPolicywhichisreviewedandupdatedatleastannually.TheInsider
Trading Policyis included asExhibit 19.1 toour 2025 AnnualReport on SECForm 10-K filedwith the SEC.This
Policy covers Company andBank directors, officers, andemployees, and certain of theirfamily members, as well as
consultants orindependent contractors,whose businessrelationship withthe Companyprovides accessto "material
nonpublic information" regarding the Company orthird parties acquired as a result of their services to the Company.
All Covered Persons are prohibitedfrom engaging in transactions, including purchasesand sales in, and gifts of, any
(i)CompanySecuritywhilein inpossessionofMaterialNonpublicInformationaboutthe Companyregardlessof
whether the Company's Trading Window is openor closed, or(ii) third partysecurities while inpossession of Material
NonpublicInformationaboutsuchissuerthathasbeenobtainedbyreasonoftheperson'semploymentby,or
associationwith,theCompany.Nosuch"coveredperson"mayengageintransactionswithrespecttoCompany
securities ofa speculativenature atany time.Such personsare atall timesprohibited fromshort-selling Company
securities or engagingin transactions involvingCompany Derivative Securities.This prohibition includestrading in
Company-based put options and otheroptions contracts, including straddles, swaps,short sales and thelike, excluding
the exercise of options and other equity awards or Company DerivativeSecurities, if any, grantedto covered persons
by the Company as incentive compensation.
This Policy also requires prior notice to and approvalof the Company before entering into, modifying orterminating
a Rule10b5-1 plan,Non-Rule 10b5-1plan, orother tradingplan.Covered personsare responsiblefor determining
that they are not in possession of,and do not have access to,material nonpublic information, and for verifying that the
Company has not imposed anyrestrictions on their ability to engagein trades when taking action withrespect to any
tradesorentering into,modifyingandterminatingany Rule10b5-1,Non-Rule10b5-1or othertradingplan.The
Insider TradingPolicy includesa policythat anyCompany issuancesor repurchasesof Companysecurities willbe
reasonably designed to promote compliance with (i) theNasdaq listing standards applicable to the Company,and (ii)
any insider trading laws that are applicable to the Company in connection tosuch transactions.
Shareholder Communications
Shareholders whowish to communicatewith theBoard, orany individualdirector or groupof directors,may doso
by sending written communications addressed to: Board of Directors of Auburn National Bancorporation, Inc., c/o C.
WayneAlderman,Secretary,AuburnNationalBancorporation,Inc.,100N.GayStreet,P.O.Box3110,Auburn,
Alabama, 36831-3110.All information will becompiled by the Secretaryof the Company andsubmitted to the Board
of Directors or each applicable director at the next regular meeting ofthe Board of Directors.
Meetings of the Board of Directors
TheBoardsofDirectorsoftheCompanyandtheBank,as wellasthecommitteesoftheCompany'sandBank's
Boards of Directors,generally hold meetings onthe same day.The Company'sBoard of Directors held12 meetings
during 2025.All directors attended at least75% of the aggregate ofall meetings of the Company's Board ofDirectors
andeachcommitteeonwhichtheyserved.CompanydirectorsareencouragedtoattendtheCompany'sannual
meetings of shareholders, and all company directors attended the 2025 AnnualMeeting of Shareholders.
14
Committees of the Board of Directors
InaccordancewiththeCompany'sCorporateGovernanceGuidelinesorBylaws,theCompany'sBoardhas
established the committees described below.As of March 23, 2026, the members of each committeeare identified in
the chart below.The Company expectsto assign Mr.Evans, who was recentlyelected director,to committees of the
Company and the Bank following the forthcoming Annual Meeting.
Director Name
Audit
Compensation
Nominating &
Corporate
Governance
Executive
Alderman
✓
✓
Andrus
✓
(C)
✓
✓
(C)
Barrett
✓
✓
✓
Conn, Jr.
✓
✓
Dumas
✓
(C)
Ham, Jr.
✓
Hedges
✓
Housel
✓
✓
Lawler
✓
May
✓
✓
(C)
✓
✓
Spencer
✓
(C)Chairman
Audit Committee
TheAuditCommitteehastheresponsibilitiessetforthintheAuditCommitteeCharter,includingreviewingthe
Company'sfinancial statements,evaluating internalaccounting controls,reviewing reports ofregulatory authorities
and determiningthat allaudits andexaminations requiredby laware performed.It appointsindependentauditors,
reviewsandapprovestheirauditplanandreviewswiththeindependentauditorstheresultsoftheauditand
management'sresponse thereto.The AuditCommittee alsoreviews theadequacy ofthe internalaudit budgetand
personnel, the internal audit planand schedule, and results of audits performedby the internal audit staff.The Audit
Committeeisresponsibleforoverseeingtheentireauditfunctionandappraisingtheeffectivenessofinternaland
external audit efforts.The Audit Committeealso coordinates withour CompensationCommittee in theevent of any
restatementofourfinancialstatementsthatwouldrequireaclawbackofpreviouslypaidcompensationunderour
ErroneouslyAwardedExecutiveIncentive-BasedCompensationRecoveryPolicy.AllmembersoftheAudit
Committee are "independent directors,"as defined inthe Nasdaq governance rules,and meet theindependence criteria
set forth inSEC Rule 10A-3(b)(1) andthe Nasdaq governancerule, andalso the Nasdaqand SEC financialliteracy
requirements.Theauditcommitteehastheauthoritytoengageindependentcounselandotheradvisers,asit
determines necessaryto performits duties.This committeeheld 13meetings in2025.The Boardof Directorshas
determined that C.WayneAlderman, TerryW.Andrus, and WaltonT.Conn, Jr.,members of the AuditCommittee,
are "audit committee financial experts," as defined by SEC rules.
15
Compensation Committee
The Compensation CommitteeCharter authorizes theCompensation Committee toreview,recommend and approve
the compensation ofthe Chief ExecutiveOfficer,other executive officersand other keyemployees of theCompany
and the Bank;evaluate theCompany's incentive compensationplans, includingany equity compensationplans; and
select, interview and make hiringrecommendations to the Board forthe Chief Executive Officer position.In addition,
the Committeeapproves changesto anyCompany personnelpolicy manualsor handbooks,and annuallyevaluates
director compensation.This Committee administersthe Company's2024 Equity andIncentive Compensation Plan,
and, in coordination with the Audit Committee, makesdeterminations in the event of any restatement of our financial
statements that would require aclawback of previously paid compensation underour Erroneously Awarded Executive
Incentive-BasedCompensationRecoveryPolicy.Although ithas notdoneso, theCompensationCommitteemay
delegate authority to subcommittees consisting of one or more members, as it deems appropriate.The Compensation
Committee mayengage itsown legalcounsel andcompensation consultants,funded bythe Company.All current
members of the Compensation Committeeare "independent directors" as defined inthe Nasdaq listing standards. This
committee held eight meetings in 2025.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee Charter purpose isto identify individuals qualified to become
members of the Company's Board of Directors andrecommend to the Board anydirector nominees.The Nominating
and CorporateGovernance Committeeconsiders allappropriate candidatesproposed bymanagement, directorsand
shareholders.TheCommitteewillconsiderallshareholdernomineesthataresubmittedinaccordancewiththe
procedures describedin theShareholder Nominationssection inthis ProxyStatement.This committeealso takesa
leadership role in shapingcorporate governance policies andpractices of theCompany, and changes to theCompany's
andtheBank'sorganizationalandgoverningdocuments.TheresponsibilitiesanddutiesoftheNominatingand
CorporateGovernance Committeeare morefully setout inthe Nominatingand CorporateGovernance Committee
Charter.AllmembersoftheNominatingandCorporateGovernanceCommitteeare"independentdirectors"as
defined in theNasdaq listing standards.The Nominating andCorporate GovernanceCommittee held fourmeetings
in 2025.
Executive Committee
The Company's Executive Committeeis authorized to act in the absence of the Board of Directors on certain matters
that require Board approval.This committee held one meeting during 2025.
16
Board Compensation
In2025,theChairmanreceived$2,200andeachdirectorreceived$1,100,respectively,foreachBoardmeeting
attended, which will be the same for 2026.When the Company and Bank boards meet on the same day,a fee is paid
for one board meetingonly.In addition, membersof the Audit Committeeand the CompensationCommittee of the
Company,which also serveas the members ofthe Audit Committeeand the CompensationCommittee of theBank,
respectively,receive anadditional feeof $250for eachcommittee meetingattended, whileeach Chairmanof these
committees receives $500 permeeting attended.Members of the Bank's Loan Committee,Asset/Liability Committee
andIT/ISSteeringCommitteereceive$250foreachcommitteemeetingattended,whileeachChairmanofthese
committees receives $500 per meeting attended.In addition to fees for attending Board and Committee meetings, the
Chairmanreceives$600 permonth,andeach directorreceives$300 permonthin directorretainer fees.In 2025,
aggregate fees paid to Companyand Bank directors totaled approximately$301,750.The compensation of directors
may be changed from time to time by the Board of Directors upon recommendation of the Compensation Committee,
without shareholder approval.
ThefollowingtableprovidesinformationconcerningthecompensationoftheCompany'sdirectorsfor2025.
CompensationpaidtoDavidA.Hedgesforhisserviceasdirectorisreportedaspartofhiscompensationasan
employee and is reported in the Summary Compensation Tableon page 19.
Name
Fees Earned or Paid
in Cash
Total
C. Wayne Alderman
$
37,450
$
37,450
Terry W.Andrus
26,550
26,550
J. Tutt Barrett
30,700
30,700
Walton T.Conn, Jr. (1)
4,450
4,450
Laura Cooper (2)
9,900
9,900
Robert W.Dumas
43,850
43,850
William F.Ham, Jr.
26,300
26,300
David E. Housel
26,300
26,300
Michael A. Lawler
18,850
18,850
Anne M. May
25,050
25,050
Sandra J. Spencer
25,050
25,050
______________
(1)Walton T.Conn, Jr. was elected as a director on October 6, 2025.
(2)Laura Cooper resigned as a director on June 11, 2026.
TheCompanydidnotgrantanyequityorotherincentiveawardspursuanttothe2024EquityandIncentive
Compensation Plan or otherwise to directors in their capacity as such, andno such awards vested or were exercised in
2025 byany personin his orher capacityas adirector.See "ExecutiveCompensation" forstock awardsto named
e
xecutive officers.
17
PROPOSAL TWO: ADVISORY VOTE ONEXECUTIVE COMPENSATION
ThepurposeoftheCompany'scompensationpoliciesandproceduresistoattractandretainexperienced,highly
qualified executivesto promote ourlong-term successand shareholdervalue.The Board, uponrecommendation of
its Compensation Committee, believes our compensation policiesand procedures achieve this objective, andtherefore
recommends that shareholders vote "FOR" the say-on-pay proposalthrough approval of the following resolution:
"RESOLVED,thatthecompensationpaidtotheCompany'snamedexecutiveofficers,asdisclosedinthe
Company'sProxyStatementforthe2026AnnualMeetingofShareholderspursuanttothecompensation
disclosure rules of theSecurities and Exchange Commission,including the compensation tablesand any related
material disclosed in the Proxy Statement, is herebyAPPROVED."
This say-on-pay proposalgives you as ashareholder the opportunityto endorse or notendorse the compensationwe
payto ournamed executiveofficers(identifiedbelow) byvotingto approveor notapprove suchcompensationas
described in this ProxyStatement. This vote isadvisory, which means that it isnot binding on theCompany, the Board
or theCompensation Committee.However,the Boardand the CompensationCommittee willconsider theoutcome
of the vote when considering future executive compensation arrangements.
In last year's ProxyStatement for the 2025 AnnualMeeting, a similar advisory votewas requested by the Company.
The results of last year's vote were as follows:
2025
Vote Count
Percent
For
1,429,238
96.1%
Against
42,206
2.8%
Abstain
16,242
1.1%
1,487,686
100.0%
The vote onthis resolution isnot intended toaddress any specificelement of compensation,but rather relatesto the
overall compensationof ournamed executiveofficers, asdescribed inthis ProxyStatement inaccordance withthe
compensationdisclosure rulesof theSEC. Weencourageyou toclosely reviewthe informationwe haveprovided
under the caption "Executive Compensation" below.
TheaffirmativevoteofamajorityofsharespresentinpersonorbyproxyattheMeetingisrequiredtoapprove
Proposal 2.
The Boardrecommendsyou vote"FOR" theapprovalof thisResolution relatedto thecompensationof the
Company's named executive officers.
18
EXECUTIVE OFFICERS
ExecutiveofficersoftheCompanyandtheBankgenerallyareappointedannuallyatameetingoftherespective
Boards ofDirectorsof theCompanyandthe Bankin Januaryto serveforone-year termsanduntil successorsare
chosenandqualified.InadditiontoMr.Hedges,whosecompleteinformationisincludedunder"ProposalOne-
Election of Directors," our other executive officers are:
Name
Information About Executive Officers
Shannon S. O'Donnell
Chief Risk Officer since April 2014 and Senior VicePresident of Credit
Administration since 2007; formerly VicePresident of Credit Administration
since 2001.Ms. O'Donnell is 56.
Robert L. Smith
Senior Vice President andChief Lending Officer of the Bank since April
2014; Vice President(Commercial and Consumer Lending) of the Bank since
2001; Mr. Smith is 57.
W. James Walker,IV
Senior Vice President andChief Financial Officer of the Company and the
Bank since January 2023; formerly Senior VicePresident and Chief
Accounting Officer of the Company and the Bank since 2015.Mr. Walkeris
57.
19
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table provides information concerningthe compensation of our named executive officersfor the years
ended 2025 and 2024.
Name and Principal Position
Year
Salary
Bonus
(3)
Stock
Awards
(4)
All Other
Compensation
(5)
Total
David A. Hedges
(1)
2025
$
350,002
$
70,000
$
15,587
$
54,056
$
489,645
President and Chief Executive
Officer of the Bank and the
Company
2024
312,000
36,000
-
45,222
393,222
Robert L. Smith
(2)
2025
250,501
43,838
11,931
10,778
317,048
Senior Vice President andChief
Lending Officer of the Bank
2024
238,571
34,000
-
10,205
282,776
W. JamesWalker,IV
(2)
2025
254,176
37,000
12,215
10,797
314,188
Senior Vice President andChief
Financial Officer of the Bank
and the Company
2024
244,400
27,000
-
10,438
281,838
______________
(1)Mr. Hedges received fees for his service as a director of the Company andthe Bank of $27,300 in 2025, and $25,300 in2024.
(2)Considered the two most highly compensatedexecutive officers other than theprincipal executive officer for the yearended
December 31, 2025.
(3)Represents cash incentive awardspaid to the Company's executive officers.Bonuses that were earned in2024 and 2025 were
paid in 2025 and 2026, respectively.
(4)Stock award amounts represent thegrant date fair valueof restricted stock units ("RSU")awards granted July 24,2025, which
were vestedonMarch10,2026.These awardsincludeddividend equivalentrightsthatwere paidinwhole sharesupon
vesting.The material terms of these grants are described below under 2025 Grants of Plan-Based Awards."
(5)For 2025, includes compensation as described under "All Other Compensation" below.
20
All Other Compensation
All Other Compensation for 2025 in the Summary Compensation Tableabove consisted of:
Name
Insurance
Premiums
Company Contributions
to Retirement and
401(k) Plans
Total
Compensation
as Director
(1)
Total
David A. Hedges
$
14,845
$
11,911
$
27,300
$
54,056
Robert L. Smith
758
10,020
-
10,778
W. James Walker,IV
630
10,167
-
10,797
______________
(1)
Represents fees earned as an employee director of the Bank and Company.
2025Grants of Plan-Based Awards
The followingtable providesinformation regardingrestricted stockunit ("RSU")awards grantedto theCompany's
named executive officers on July 24, 2025 pursuant to the Company's2024 Equity and Incentive Compensation Plan
(the "2024Plan") andrelated AwardAgreements.All theseRSUs wereoutstanding atDecember 31,2025 andall
vested onMarch 10,2026, whenshares wereissued inrespect ofthe RSUsand relateddividend equivalentsnet of
shares withheld by the Company for taxes.
Name
Grant Date
All Other Stock Awards:
Number of Shares of
Stock or Units (#)
Grant Date Fair Value of
Stock Awards ($)
David A. Hedges
July 24, 2025
550
$
15,587
Robert L. Smith
July 24, 2025
421
11,931
W. James Walker,IV
July 24, 2025
431
12,215
TheseRSUs vestedon March10,2026 (the"VestingDate"),upon theAwardAgreement'stermsandconditions,
including continuedemployment withthe Companyon the VestingDate andpotential accelerationof vestingupon
certain events specified in the AwardAgreement.
ThevestingoftheRSUsandtheDividendEquivalentsmaybeaccelerateduponcertainevents,inthefollowing
amounts:
●
100% vesting on the Recipient's deathor Disability.
●
Pro rata vesting to the Recipient's date of Retirement where theRecipient has been employed for the number
of years specified in the RSU AwardAgreement.
●
The "Pro Rata Amount" where the Company terminates the Recipient without"Cause."
●
Upon a Change in Control where the RSUs are not assumed by the Surviving Entity.
21
Except as provided above, upon a Recipient'sTermination of Employment,all RSUs and Dividend Equivalents not
previously vested shall terminate. Upon the Company'sTermination of Employmentfor Cause, the Compensation
Committee may demand the return of all Shares, cash and other property receivedin respect of RSUs or Dividend
Equivalents that vested during the period of conduct that was Cause of Terminationof Employment.
The AwardAgreement contains several restrictive covenants applicable to the Recipient:
●
Maintenance of the Company's ConfidentialInformation in accordance with the Company'spolicies during
employment andfor two yearsthereafter,and the Recipientshall not discloseor use orpermit thirdparties
tousetheCompany'sConfidentialInformationorTradeSecrets,withouttheCompany'spriorwritten
consent.
●
While the Recipient is employed by the Company,and for one year thereafter, the Recipient shall not solicit
orrecruitanyProtectedEmployeetoterminateemploymentwiththeCompanyortoenterintoany
employment, agency or other relationship with a third party with whom the Recipientis affiliated.
●
While employedby theCompany andfor oneyear thereafter,the Recipientshall notsolicit anyCompany
Customer for Business Activities.
The AwardAgreement prohibitsthe pledge,assignment ortransfer ofRSUs (includingRSUs receivedas Dividend
Equivalents). The AwardAgreement is subject to the Company's Insider TradingPolicy, which prohibits speculative
transactionsinCompanysecurities,includinganyinstrumentsorstrategies,includingDerivativeSecurities,to
increase the value or reduce of the risks of any Award.
Practices Related to Equity Awards
The RSUs granted on July 24, 2025 are the only grants of awards that have been made under the 2024 Plan, and were
made following theissuance of the Company'searnings release forthe period ending June30, 2025.The Company
currentlydoesnot,andduring2025didnotgrantstockoptions,stockappreciationrights,orsimilaroption-like
instruments under the2024 Plan andhas no policiesor practices todisclose pursuant toItem 402(x) ofSEC Regulation
S-K.
In addition, theCompany
does not
schedule equity awardgrants in anticipationof the release ofmaterial, non-
public information
, nor does
the Company time therelease of
material non-public information
based on equity grant
dates.
2025Option Exercises and Stock Vested
The Company had no option exercises or stock awards that vested during 2025for the named executive officers.
22
Outstanding Equity Awardsat December 31, 2025
The followingtable providesinformationregarding RSUawards heldby theCompany'snamed executiveofficers
that were outstanding and unvested as of December 31, 2025.
Name
Number of Shares or Units
of Stock That Have Not
Vested (#)
Market Value of Shares or
Units of Stock That Have
Not Vested ($)
David A. Hedges
550
$
14,823
Robert L. Smith
421
11,346
W. James Walker,IV
431
11,615
Equity Compensation Plan Information
The following table provides information as of December 31, 2025 with respect to shares of the Company'scommon
stock that may be issuedunder the Company'sequity compensation plans approvedby shareholders.There were no
shares issued under equity compensation plans not approved byshareholders.
Plan Category
Number of Securities to be
Issued Upon Exercise of
Outstanding Options,
Warrants and Rights
Weighted-Average Exercise
Price of Outstanding Options,
Warrants and Rights
Number of Securities
Remaining Available for
Future Issuance Under Equity
Compensation Plans
(Excluding Outstanding
Awards)
Equity compensation
1
plans approved by
shareholders
3,030
n/a
346,970
Total
3,030
n/a
346,970
Pension Benefits and Nonqualified Deferred Compensation
TheCompanydoesnotofferanypensionornonqualifieddeferredcompensationbenefitstoitsnamedexecutive
officers.
23
Pay-Versus-Performance
The following table sets forth information concerning the compensation of our principalexecutive officer, or "PEO,"
and, on an average basis,the compensation for our twoother highest paid namedexecutive officers, or "Other NEOs,"
for each of the fiscalyears ending December 31, 2025,2024 and 2023, as suchcompensation relates to ourfinancial
performance for each such fiscal year.
Year
Summary
Compensation
Table Totalfor PEO
(1)
Compensation
Actually Paid to
PEO (1)(2)
Average Summary
Compensation
Table Totalfor
Other NEOs (1)
Average
Compensation
Actually Paid to
Other NEOs (1)(2)
Initial Fixed $100
Investment Based
on Total
Shareholder Return
(3)
Net Income
2025
$
489,645
$
488,881
$
315,618
$
315,026
$
135.85
$
7,255,000
2024
393,222
393,222
282,307
282,307
113.05
6,397,000
2023
341,224
341,224
271,119
271,119
97.19
1,395,000
______________
(1)For 2025, 2024 and2023, the PEO was
David A. Hedges
and the Other NEOs wereRobert L. Smith, SeniorVice President
and Chief Lending Officer and W. James Walker,IV,Senior Vice President and Chief Financial Officer.
(2)
Compensation Actually Paid reflects the exclusions and inclusions of certain amounts forthe PEO and the Other NEOs as set
forth below.To calculatethe amounts ofCompensation Actually Paidto the PEOin 2025, thefollowing adjustments were
made to the PEO's Summary Compensation TableTotal:
a.
Wededucted $
15,587
reported in theSummary CompensationTable,reflecting thegrant datefair valueof 550RSUs
granted to the PEO in fiscal year 2025;
b.
We added $
14,823
, reflecting the fair value of such RSUs as of the end of fiscal year 2025.
To calculate the amounts of Compensation Actually Paid, on average, to our Other NEOs in 2025, the following adjustments
were made to the Average Summary Compensation TableTotal for Other NEOs:
a.
We deducted $
12,073
reported in theSummary Compensation Table, reflecting the averagegrant date fairvalue of RSUs
to the Other NEOs in fiscal year 2025;
b.
We added $
11,481
, reflecting the average fair value of such RSUs as of the end of fiscal year 2025.
(3)
Total Shareholder Return
is the cumulative total shareholder return, whichassumes $100 was invested in our commonstock
at the market price at the regular close of Nasdaq trading on December 31, 2022 through December 31, 2025.It assumes the
reinvestment of all cashdividends prior to anytax effect.Net income for 2023reflects the losses incurredto reposition our
balance sheet in December 2023.
24
Relationship Between Pay and Performance
DescriptionofRelationshipBetweenPEOandOtherNEOCompensationActuallyPaidandCompanyTotal
Shareholder Return ("TSR")
ThefollowingchartsetsforththerelationshipbetweenCompensationActuallyPaidtoourPEO,theaverageof
CompensationActually Paidto ourother NEOs,and theCompany'scumulativeTSR overthe threemost recently
completed fiscal years.
.
Description of Relationship Between PEO and Other NEO CompensationActually Paid and Net Income
ThefollowingchartsetsforththerelationshipbetweenCompensationActuallyPaidtoourPEO,theaverageof
Compensation Actually Paid to ourother NEOs, and our Net Income duringthe three most recently completedfiscal
years.
.
25
POTENTIAL PAYMENTSUPON TERMINATIONOR CHANGE IN CONTROL
The Company does not have any severance or change in control agreements with any of its named executive officers.
STOCK OWNERSHIP BY CERTAINPERSONS
The followingtable setsforth the numberand the percentageof shares ofthe Company'sCommon Stockthat were
beneficially owned, as of the RecordDate, by (1) each of ourdirectors and each of our namedexecutive officers, (2)
all of our directors and executiveofficers as a group, and(3) each person known to usto beneficially own more than
5% of any class of ourvoting common stock.Other than as set forth below,no "persons" (as that term is definedby
theSEC)areknownbytheCompanytobethebeneficialownersofmorethan5%oftheCommonStock,the
Company's only class of votingsecurities, as of the Record Date.
Name of Beneficial Owner
(1)
Number of Shares
(2)
Percent of Class
All Directors and Named Executive Officers:
C. Wayne Alderman
5,116
*
Terry W.Andrus
4,045
*
J. Tutt Barrett
(3)
17,860
*
Walton T.Conn, Jr.
2,800
*
Robert W.Dumas
44,745
1.28%
Jeffrey J. Evans
150
*
William F.Ham, Jr.
(4)
5,273
*
David E. Housel
9,055
*
Anne M. May
(5)-(8)
288,885
8.26%
Michael A. Lawler
3,000
*
Sandra J. Spencer
(9)-(12)
258,214
7.39%
David A. Hedges
13,401
*
Robert L. Smith
714
*
W. James Walker,IV
742
*
All Directors and Executive Officers as a Group (15
persons)
(13)
654,525
18.72%
Persons known to Company who own more than 5% of
outstanding shares of Company Common Stock:
B. Steven Spencer
(14)-(16)
251,136
7.18%
Emil F. Wright,Jr.
(17)-(19)
334,164
9.56%
_____________
*Less than 1%
(1)
Unless specified below,each director's,named executive officer's, andpersons known to the Companywho own more than
5% ofoutstanding sharesof CompanyCommon Stock'sbusiness addressis c/oAuburnBank, 100N. GayStreet, Auburn,
Alabama 36830.
26
(2)
Information relatingto beneficialownership ofCommon Stockby theindividuals namedin theabove tableis basedupon
information furnished by the respective individuals using "beneficial ownership" concepts set forth in rules of the SEC under
the SecuritiesExchange Actof 1934,as amended.Under suchrules, aperson isdeemed tobe a"beneficial owner"of a
security if that person has or shares "voting power," which includes the power to vote or direct the voting of such security, or
"investment power," whichincludes the power to disposeof or to direct thedisposition of such security.The person is also
deemed to bea beneficial ownerof anysecurity of whichthat person hasa rightto acquire beneficialownership within60
days.Under such rules, morethan one person maybe deemed to bea beneficial owner ofthe same securities, anda person
maybedeemedtobeabeneficialownerofsecuritiesastowhichheorshemaydisclaimanybeneficialownership.
Accordingly,directorsand namedexecutive officersmay benamedas beneficialowners ofshares astowhich theymay
disclaim anybeneficial interest.Except asindicated inother notesto thistable describingspecial relationshipswith other
persons andspecifying sharedvoting orinvestment power,directors andnamed executiveofficers possesssole votingand
investment power withrespect to allshares of CommonStock set forthopposite their names.Shares have beenrounded to
whole shares.
(3)
Includes 8,744 shares held by Mr. Barrett's wife, as to which Mr.Barrett disclaims beneficial ownership.
(4)
Includes 300shares heldby Mr.Ham'swife, asto whichMr.Ham maybe deemedto haveshared votingand investment
power.
(5)
Includes 33,311 shares held individually by Ms. May.
(6)
Includes 11,672shares held by Ms.May pursuant toa durable power ofattorney on behalfof Edward L.Spencer, III,as to
which Ms. May disclaims beneficial ownership.
(7)
Includes 243,902 shares held by Ms. May as Trustee ofthe Spencer 2008 Exempt Trust FBO Edward L. Spencer,III and the
Spencer Family Non-Exempt Trust FBO Edward L. Spencer, III as to which Ms. May disclaims beneficial ownership.
(8)
Includes 11,672shares heldby Ms.May pursuantto adurable powerof attorneyon behalfof EdwardL. Spencer,III, and
1,320 of the 3,960shares held by SpencerLLC where Edward L.Spencer, III isa one-third member andwhich are covered
by the power of attorney.Ms. May disclaims beneficial ownership in all such shares.
(9)
Includes 243,903shares heldby Ms.Spencer asTrustee ofthe SpencerFamily Non-ExemptTrust FBOSandra J.Spencer
and as Trustee of the Spencer 2008 Exempt Trust FBO Sandra J. Spencer.
(10)
Includes 10,272 shares held individually by Ms. Spencer.
(11)
Includes 1,320 of the3,960 shares held bySpencer LLC where Ms.Spencer is the managingmember and a one-thirdmember.
Ms. Spencer disclaims beneficial ownership of 2,640 shares held beneficially by the other two members of Spencer LLC.
(12)
Includes 79 sharesowned by Ms. Spencer'shusband, individually,as to whichMs. Spencer maybe deemed tohave shared
voting and dispositive power.
(13)
Includes all 3,960 shares heldby Spencer LLC where Ms.Spencer is the managing member.To eliminatedouble counting,
the totalexcludes 1,320shares heldin SpencerLLC inrespect ofMr.Edward L.Spencer's one-thirdmembership interest,
where Ms. May holds a durable a durable power of attorney on behalf of Edward L. Spencer III.
(14)
Includes 243,902 sharesheld by Mr.Spencer as Trusteeof the Spencer 2008Exempt Trust FBOBruce Steven Spencerand
as Trustee of 2008 Exempt Trust FBO Bruce Steven Spencer.
(15)
Includes 5,914 shares held individually by Mr. Spencer.
(16)
Includes 1,320 ofthe 3,960 shares heldby Spencer LLCwhere Mr.Spencer is aone-third member.Mr. Spencerdisclaims
beneficial ownership of 2,640 shares held beneficially by the other two members of Spencer LLC.
(17)
Includes 58,978 sharesheld by Dr. Wright's wife, asto which Dr.Wright may bedeemed to haveshared voting andinvestment
power.
(18)
Excludes 57,820 sharesheld by Ferrocene,LP, a family limited partnership whereDr. Wright and his wifeare general partners
with voting anddispositive power,but where thelimited partners beneficiallyown 57,820 shares(95% of thepartnership's
total interests), as to which Dr. Wright disclaims any economic interest.
27
(19)
Excludes 500 sharesheld by ComitasFoundation, Inc., a501(c)(3) private foundation,whose executiveofficers are Dr. Wright
and his wife.Dr. Wright disclaims any economic interest in such shares.
CERTAINTRANSACTIONS AND BUSINESS RELATIONSHIPS
VariousCompany andBank directors,officers, andtheir affiliates,including corporationsand firmswhere theyare
directors or officers or where theyand/or their families have anownership interest, are customers of theCompany and
the Bank.These persons,corporations, andfirms havehad transactionsin theordinary courseof businesswith the
CompanyandtheBank,includingborrowings,allofwhichmanagementbelieveswereonsubstantiallythesame
terms,includinginterestratesandcollateral,asthoseprevailingatthetimeforcomparabletransactionswith
unaffiliatedpersonsanddidnotinvolvemorethanthenormalriskofcollectabilityorpresentotherunfavorable
features. Such transactionsare subject toreview and approvalas and to theextent provided inour Audit Committee
Charter. TheCompany and the Bankexpect to have suchtransactions, under similarconditions, with theirdirectors,
officers, and affiliates in the future.
Federal Reserve Regulation O requires loans made to executive officers and directorsto be made on substantially the
sameterms,includinginterestratesandcollateral,andfollowingcredit-underwritingprocedures,thatarenoless
stringent thanthose prevailingat thetime forcomparable transactionsby theBank withother persons.Such loans
also may not involve more than the normal risk of repayment orpresent other unfavorable features.Additionally, no
eventof defaultmay haveoccurred(that is,such loansare notdisclosedas non-accrual,past due,restructured,or
potential problems).Regulation O requires the Board ofDirectors to review any loanto a director or hisor her related
interests that has become criticized and whether such classification affects such director's independence.In addition,
the Audit CommitteeCharter provides thatthe Audit Committeewill reviewand approve allrelated-party transactions.
Thisincludesareviewofthe Company'scompliancewith applicablebankinglaws,including,withoutlimitation,
those banking laws and regulations concerning loans to insiders.
Mr.Evans servesas anexecutive officerof J& LContractors ("J& L").During 2025,and priorto hiselection as
director of theCompany and the Bankon March 26, 2026,J & L constructedbuild-outs of commonarea and leased
tenant space at the Bank's headquartersfacility, the AuburnBank Center,which opened in June 2022.
The Bankhas contractedwith afull-service commercialreal estatefirm basedin Birmingham,Alabama thatis not
affiliated with the Companyor Mr. Evans(the "Property Manager"),to serve as leasing agentand property manager
for the AuburnBankCenter. TheAuburnBank Center,has approximately 46,000square feet of ClassA office space
and approximately5,000 squarefeet ofretail spaceavailable tothird-party tenants,of whichapproximately 32,000
square feet is currently leased and occupied.
In itscapacity as landlord,the Bankis aparty to theconstruction contracts withJ &L; however, the Bankhas delegated
constructionadministrationresponsibilitiestothePropertyManager,includingoversightoftenantimprovements,
contractor coordination, and approval and processing of contractor payments.
The Bank reimburses the Property Manager for constructioncosts related to common areas and to the extenta tenant
improvement allowance is provided under the applicable lease agreements.Construction costs for the leased space in
excessofthetenantimprovementallowancearereimbursedbythetenant.Tenantimprovementallowancesare
generally capitalized by the Bank and amortized over the life of the relatedlease.
The aggregateamount paidto J &L underconstruction contractswith theBank wasapproximately $1.4million in
2025. The Bank, as landlord,retains approval rights overthe selection of contractorsfor tenant spaces; however,the
Bank believesthat the termsof the engagementwith J &L, including pricing,were consistent withthose that could
have been obtained in comparable arm's-length transactions.
These transactions were enteredinto prior to Mr.Evans' election as director ofthe Company and the Bankand were
not subject tothe Company's related person transaction approvalpolicy at thosetimes.Following Mr. Evans' election
as director, any future transactions with J & L will be subject tosuch policy.
28
Other than the transactions disclosed above, noneof the directors or executive officers ofthe Company, owners of 5%
or more ofthe Company'soutstanding stock, ortheir immediate familymembers, had adirect or indirectinterest in
any transactioninvolving theCompany during 2026or 2025,served asan executiveofficer of,or owns,or during
2026or 2025owned, of record or beneficially,greater than 10% equity interest in any business or professional entity
that has made or received paymentsduring 2026or 2025, or has acurrently proposed transaction, where the Company
is to be participant, where the amount involved exceeds $120,000.
COMPLIANCE WITH SECTION 16(A)
OF THE
SECURITIES EXCHANGE ACT OF 1934
The Companyis subjectto Section16(a) ofthe SecuritiesExchangeAct of1934,as amended,which requiresthe
Company'sexecutiveofficersanddirectors,andpersonswhoownmorethan10%ofaregisteredclassofthe
Company's equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange
Commission.Officers, directorsand greater-than-10%shareholders arerequired bySEC regulationsto furnishthe
Company with copies of all Section 16(a) forms they file.
Delinquent Section 16(a) Reports
Based solely on its reviewof the copies ofCommission Forms 3, 4 and5 furnished to the Companyduring and with
respect to 2025, and information provided by the Company'sSection 16 reporting persons, or written representations
thatnoForms5wererequired,theCompanybelievesthatallSection16(a)filingrequirementsapplicabletothe
Company's andthe Bank's executiveofficers, directors and greater-than-10%beneficial owners were complied with
during 2025,other thanone latefiling byMr.TuttBarrett relatedto sharesinherited byhis spouse,as towhich he
disclaimed beneficial ownership.These shares were reported on Commission Form 5 on February 17, 2026.
AUDIT COMMITTEE REPORT
Management is responsible for the Company'sinternal controls and the financial reportingprocess.The Company's
independentregisteredaccountantsareresponsibleforperforminganindependentauditoftheCompany's
consolidatedfinancialstatementsinaccordancewiththestandardsofthePublicCompanyAccountingOversight
Board ("PCAOB") andissuing a report thereon.The Audit Committee's responsibility isto monitor and overseethese
processes.Inthiscontext,wehavemetandhelddiscussionswithmanagementandtheindependentregistered
accountants.We have reviewed and discussed the Company's audited consolidatedfinancial statements for the fiscal
year ended December31, 2025, with managementand the independent registeredaccountants. This reviewincluded
discussions with the Company's independent registeredaccountants of matters required to be discussed by PCAOB's
AS 1301, Communications with Audit Committees and the SEC.
The Company'sindependent registeredaccountants haveprovided usthe writtendisclosures andthe letterrequired
by PCAOBProfessionalStandardsRule 3526,Communicationwith AuditCommittees ConcerningIndependence,
and we discussed with the independent registered accountants that firm'sindependence.
Baseduponourdiscussionswithmanagementandtheindependentregisteredaccountantsandourreviewofthe
representations of management andthe report of theindependent registered accountants tothe Audit Committee, we
recommendedtotheBoardofDirectorsthattheauditedconsolidatedfinancialstatementsbeincludedinthe
Company's Annual Reporton Form 10-K for the fiscal year ended December 31, 2025.
Terry W.Andrus
C. Wayne Alderman
J. Tutt Barrett
Walton T.Conn, Jr.
William F.Ham, Jr.
David E. Housel
Anne M. May
29
PROPOSAL THREE: RATIFICATIONOF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
Appointment of Independent Registered Public AccountingFirm
The Audit Committeeof the Boardof the Companyhas approved theappointment of ElliottDavis, LLC toserve as
theCompany'sindependentregisteredpublicaccountingfirmfortheCompanyforthe yearendingDecember 31,
2026. TheAudit Committeeconsidered thebackground, expertiseand experienceof theaudit teamassigned tothe
Company and various otherrelevant matters, including theproposed fees foraudit services.A representative ofElliott
Davis will be present at the Meeting and will be giventhe opportunity to make a statement on behalf of the firm, and
will also beavailable torespond toappropriate questionsfrom shareholders.If the shareholdersshould failto ratify
theappointmentoftheindependentregisteredpublicaccountingfirm,theAuditCommitteewillreconsiderthe
appointment.
Independent Public Accountants
The fees billed by the Company'sindependent registered public accounting firmrelating to the 2025 and 2024fiscal
years were as follows:
2025
2024
Audit Fees
(1)
$
185,272
$
175,000
Audit-Related Fees
(2)
10,000
17,200
Total
$
195,272
$
192,200
____________________
(1)Includes the aggregatefees billed byElliott Davis forprofessional services renderedfor the auditof the Company'sannual
financial statements, review ofunaudited financial statements includedin the Company's Forms 10-Qfiled during fiscal years
2025and 2024 andservices normally providedfor statutory andregulatory filings orengagements for the fiscalyears 2025
and 2024.
(2)Includes the aggregate fees billedby Elliott Davis for professional servicesrendered for certain agreed uponprocedures and
other audit and attestation reports related to compliance matters during fiscal years 2025 and 2024.
Audit Committee Review
The Company's Audit Committee has reviewed the services rendered and thefees billed by Elliott Davis for thefiscal
year ended December31, 2025.The Audit Committeehas determined thatthe services renderedand the fees billed
last year thatwere not relatedto the auditof the Company's financial statementsare compatible with theindependence
of Elliott Davis as the Company's independentregistered accountants.
30
Audit Committee Pre-ApprovalPolicy
UndertheAuditCommittee'sCharteranditspre-approvalpolicy,theAuditCommitteeisrequiredtoapprovein
advance the terms of all audit services provided to the Company as well as all permissible audit related and non-audit
services tobe providedby the independentpublic accountants.Unless aservice tobe providedby theindependent
public accountants has received approval under the pre-approval policy,it will require specific approval by the Audit
Committee.The pre-approval policy describesthe particular services tobe provided, and theAudit Committee isto
be informed about eachservice provided.The approval of non-audit servicesmay be performed by theChairman of
theCommitteeandreportedtothefullAuditCommitteeatitsnextmeeting,butmaynotbeperformedbythe
Company'smanagement.Thetermofanypre-approvalis12months,unlesstheAuditCommitteespecifically
provides for a different period.
The AuditCommittee willapprove theannual auditengagement termsand feesprior tothe commencementof any
audit workother thanthat necessaryfor theindependent publicaccountant toprepare theproposed auditapproach,
scope and fee estimates.In addition to theannual audit work, theindependent public accountants may performcertain
otherauditrelatedornon-auditservicesthatarepre-approvedbytheAuditCommitteeandarenotprohibitedby
regulatory or other professional requirements.Engagements for the annual audit and recurring tax return preparation
engagements shall be reviewed and approved annuallyby the Audit Committee based onthe agreed upon engagement
terms,conditionsandfees.Thenatureanddollarvalueofservicesprovidedundertheseengagementsshallbe
reviewed bythe AuditCommittee toapprove changesin terms,conditions andfees resultingfrom changesin audit
scope, Company structure, exchange rates or other items, if any.
In the event audit-related or non-audit services that are pre-approved under the pre-approval policy have an estimated
cost in excess of certain dollar thresholds, these services will require specificapproval by the Audit Committee or by
theChairmanoftheAuditCommittee.AnyproposedengagementmustbeapprovedinadvancebytheAudit
Committee orby the Chairmanof theAudit Committeeapplying theprinciples setforth inthe pre-approvalpolicy,
prior tothe commencementof theengagement.In determiningthe approvalof servicesby theindependent public
accountants, the AuditCommittee evaluates eachservice to determinewhether the performanceof such servicewould:
(a)impairthepublicaccountant'sindependence;(b)createamutualorconflictinginterestbetweenthepublic
accountant and the Company; (c)place the public accountantin the position of auditinghis or her ownwork; (d) result
in the public accountant acting as management or an employeeof the Company; or (e) place the public accountant in
a position of being an advocate for the Company.In no event are monetary limits the only basis for the pre-approval
of services.
All ofthe servicesprovided byElliott Davisduring 2025and describedabove underthe caption"Audit Fees"and
"Audit-Related Fees" were pre-approved by the Company'sAudit Committee pursuant to SEC Regulation S-X, Rule
2-01(c)(7)(i).
TheaffirmativevoteofamajorityofsharespresentinpersonorbyproxyattheMeetingisrequiredtoapprove
Proposal 3.
The Board recommends you vote "FOR" theratification of the appointment of ElliottDavis as the independent
registered public accounting firm for the fiscalyear ending December 31, 2026.
31
SHAREHOLDER PROPOSALS FOR the 2027 ANNUAL MEETING
Proposals of shareholdersintended to be presented atthe Company's2027 Annual Meeting ofShareholders must be
received by the Companyon or before December 3,2026 and must complywith the requirements ofSEC Rule 14a-
8, in order to be eligible for inclusionin the Company's proxy statement and form of proxy for that meeting.If notice
of a proposal is not received bythe Company in accordance with the datesspecified pursuant to SEC Rule 14a-8, then
the proposalwill bedeemed untimelyand wewill havethe rightto excludethe proposalfrom considerationat the
2027 Annual Meeting and/or to exercise discretionary voting authority and vote proxies returned to us with respect to
such proposal or director nomination.
If a shareholder does not submit a proposal for inclusion in next year's proxy statement, but instead wishes to present
it directly atthe Company's 2027 AnnualMeeting ofShareholders, the Company's Bylawsrequire that theshareholder
notify the Companyof such proposalin writing nolater than December 3,2026, or 120calendar days in advanceof
the date (with respect tothe Company's 2027Annual Meeting of Shareholders)that the Company'sproxy statement
wasreleasedtoitsshareholdersinconnectionwiththeMeeting.Theshareholdermustalsocomplywiththe
requirements of Article III, Section 16 of the Company'sBylaws with respectto shareholder proposals.
OTHER MATTERS
The Companyknows ofno othermatters tobe brought beforethe Meeting.However, ifany otherproper matteris
presented, the persons namedin the enclosedform of Proxyintend to votethe Proxy inaccordance with theirjudgment
of what is in the best interest of the Company.
By Order of the Board of Directors
/s/ Robert W. Dumas
Robert W.Dumas
Chairman of the Board
April 2, 2026
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