<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
FILED BY THE REGISTRANT [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6 (e) (2))
[X] DEFINITIVE PROXY STATEMENT
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
FORSYTH BANCSHARES, INC.
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] NO FEE REQUIRED.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-----------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------
5) Total fee paid:
-----------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE> 2
FORSYTH BANCSHARES, INC.
P.O. BOX 2820
CUMMING, GA 30028
770-886-9500
April 28, 1999
TO OUR SHAREHOLDERS:
You are cordially invited to attend the 1999 Annual Meeting of
Shareholders of Forsyth Bancshares, Inc., which will be held at the Sawnee
Community Center on Tuesday, May 18, 1999, at 10:00 a.m., local time.
At the Annual Meeting, you will be asked to consider and vote upon (i)
the election of seventeen directors to serve until the Annual Meeting of
Shareholders in 2000 and until their successors are elected and qualified and
(ii) such other matters as may properly come before the Annual Meeting or any
reconvened meeting following any adjournment thereof.
Enclosed are the Notice of Annual Meeting, Proxy Statement, Proxy and
1998 Annual Report to Shareholders. We are proud of our progress and we
encourage you to review carefully our Annual Report.
We hope you can attend the Annual Meeting of Shareholders and vote
your shares in person. In any case, please complete the enclosed Proxy and
return it to us. Your completion of the Proxy will ensure that your preferences
will be expressed on the matters that are being considered. If you deliver a
completed proxy, but you are able to attend the Annual Meeting, you may revoke
your Proxy and re-cast your votes by voting in person at the Annual Meeting or
by following the revocation procedures described in the accompanying Proxy
Statement.
If you have any questions about the Proxy Statement or our Annual
Report, please contact us.
Sincerely,
/s/ James J. Myers
James J. Myers
Chairman of the Board
<PAGE> 3
FORSYTH BANCSHARES, INC.
P.O. BOX 2820
CUMMING, GA 30028
770-886-9500
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON TUESDAY, MAY 18, 1999
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Shareholders of
Forsyth Bancshares, Inc. (the "Company") will be held at the Sawnee Community
Center, located at 1090 Tribble Gap Road, Cumming, Georgia 30040 on Tuesday,
May 18, 1999, at 10:00 a.m., local time (the "Annual Meeting"), for the
following purposes:
1. To consider and vote upon the re-election of seventeen (17)
directors to serve until the Annual Meeting of Shareholders
in 2000 and until their successors have been duly elected and
qualified.
2. To transact such other business as may properly come before
the Annual Meeting and any adjournments or postponements
thereof.
Only shareholders of record at the close of business on April 10, 1999,
are entitled to notice of, and to vote at, the Annual Meeting. A complete list
of shareholders entitled to vote at the Annual Meeting will be available at the
Annual Meeting.
By Order of the Board of Directors,
/s/ David H. Denton
David H. Denton
President & Chief Executive Officer
Cumming, Georgia
April 28, 1999
YOU ARE URGED TO COMPLETE, SIGN, DATE, AND RETURN YOUR PROXY PROMPTLY IN THE
ENVELOPE PROVIDED SO THAT YOUR SHARES WILL BE VOTED IN ACCORDANCE WITH YOUR
WISHES. RETURNING YOUR PROXY DOES NOT DEPRIVE YOU OF YOUR RIGHT TO ATTEND THE
MEETING AND VOTE YOUR SHARES IN PERSON.
<PAGE> 4
FORSYTH BANCSHARES, INC.
-------------------------------
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 18, 1999
-------------------------------
INTRODUCTION
GENERAL
This Proxy Statement is being furnished to the shareholders of Forsyth
Bancshares, Inc. (the "Company") in connection with the solicitation by the
Company of proxies for use at the Company's 1999 Annual Meeting of Shareholders
to be held at Sawnee Community Center, located at 1090 Tribble Gap Road,
Cumming, Georgia 30040, on Tuesday, May 18, 1999, and at any postponements or
adjournments thereof (the "Annual Meeting").
The Annual Meeting is being held to consider and vote upon (i) the
re-election of seventeen (17) directors to serve until the Company's Annual
Meeting of Shareholders in 2000 and until their successors are elected and
qualified and (ii) such other business as may properly come before the Annual
Meeting. The Board of Directors of the Company knows of no other business that
will be presented for consideration at the Annual Meeting other than the
matters described in this Proxy Statement. This proxy solicitation is being
made by Forsyth Bancshares, Inc.
The Company's 1998 Annual Report to Shareholders, including financial
statements for the fiscal year ended December 31, 1998, accompanies this Proxy
Statement. These materials are first being mailed to the shareholders of the
Company on or about April 28, 1999.
RECORD DATE, SOLICITATION AND REVOCABILITY OF PROXIES
The Company's Board of Directors has fixed April 10, 1999 as the
record date (the "Record Date") for the determination of the Company's
shareholders entitled to notice of, and to vote at, the Annual Meeting.
Accordingly, only shareholders of the Company on the Record Date will be
entitled to vote at the Annual Meeting. On the Record Date, there were 800,000
shares of the no par value common stock of the Company ("Common Stock" or
"Shares") issued and outstanding and held by approximately 613 holders of
record.
Holders of Common Stock are entitled to one vote on each matter
considered and voted upon at the Annual Meeting for each Share of Common Stock
held of record on the Record Date. Shares of Common Stock represented by a
properly executed proxy, if such proxy is received in time and not revoked,
will be voted at the Annual Meeting in accordance with the instructions
indicated in such proxy. IF NO INSTRUCTIONS ARE INDICATED, SUCH SHARES OF
COMMON STOCK WILL BE VOTED "FOR" ELECTION OF ALL SEVENTEEN NOMINEES FOR
DIRECTOR NAMED IN THE PROXY STATEMENT AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER BUSINESS PROPERLY BROUGHT BEFORE THE ANNUAL MEETING.
<PAGE> 5
A shareholder who gives a proxy may revoke it at any time prior to its
exercise at the Annual Meeting by (i) giving written notice of revocation to
the Secretary of the Company, at Forsyth Bancshares, Inc., 501 Tri-County
Plaza, Cumming, Georgia 30040, (ii) properly submitting to the Company a duly
executed proxy bearing a later date to P.O. Box 2820, Cumming, Georgia 30028,
or (iii) appearing in person at the Annual Meeting and voting in person.
The approval of each proposal set forth in this Proxy Statement
requires that a quorum be present at the Annual Meeting. The presence, in
person or by properly executed proxy, of the holders of a majority of the
outstanding Shares entitled to vote at the Annual Meeting is necessary to
constitute a quorum. Each shareholder is entitled to one vote on each proposal
per Share held as of the Record Date. In the event that a quorum is not
represented in person or by proxy at the Annual Meeting, a majority of Shares
represented at that time may adjourn the Annual Meeting to allow the
solicitation of additional proxies or other measures to obtain a quorum.
PROPOSAL ONE - ELECTION OF DIRECTORS
NOMINEES
The Bylaws of the Company provide that the Board of Directors of the
Company shall consist of members who shall be subject to re-election each year.
The directors are elected by the shareholders for a term of one year and until
their successors are elected and qualified. The term of office of directors
expires each year at the Annual Meeting of Shareholders, and a new class of
directors is elected or re-elected by the shareholders each year at that time.
At the Annual Meeting, the terms of Catherine M. Amos, Jeffrey S.
Bagley, Danny M. Bennett, Michael P. Bennett, Bryan L. Bettis, Talmadge W.
Bolton, Thomas L. Bower III, Charles R. Castleberry, David H. Denton, Charles
D. Ingram, Herbert A. Lang, Jr., John P. McGruder, James J. Myers, Danny L.
Reid, Charles R. Smith, Wyatt L. Willingham and Jerry M. Wood will expire, and
the Board of Directors has nominated each of these 17 individuals to stand for
re-election as directors at the Annual Meeting. If elected by the shareholders,
each of the nominees will serve a one-year term which will expire at the Annual
Meeting of Shareholders in 2000.
The Company has not nominated anyone to replace Bill H. Barnett, who
resigned as director in 1998. Moreover, the Company has decreased the size of
its Board of Directors from 18 directors to 17 directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
"FOR" THE PROPOSAL TO RE-ELECT ALL OF THE NOMINEES FOR ELECTION AS DIRECTORS.
If any of the nominees should be unavailable to serve for any reason
(which is not anticipated), the Board of Directors may designate a substitute
nominee or nominees (in which case the persons named as proxies on the enclosed
proxy card will vote the Shares represented by all valid proxy cards for the
election of such substitute nominee or nominees), allow the vacancy or
vacancies to remain open until a suitable candidate or candidates are located,
or by resolution provide for a lesser number of directors.
2
<PAGE> 6
VOTE REQUIRED
This Proposal requires approval by a "plurality" of the votes cast by
the Shares entitled to vote in the election. This means that Proposal One will
be approved only if the holders of a majority of the Shares entitled to vote
and voting at the Annual Meeting vote in favor of Proposal One. With respect to
Proposal One, abstentions and "broker non-votes" will be counted as Shares
present for purposes of determining the presence of a quorum. However, neither
abstentions nor "broker non-votes" will be counted as votes cast for purposes
of determining whether a particular proposal has received sufficient votes for
approval. A "broker non-vote" occurs when a nominee does not have discretionary
voting power with respect to that proposal and has not received instructions
from the beneficial owner.
INFORMATION REGARDING NOMINEES AND CONTINUING DIRECTORS
The following table sets forth certain information regarding the
seventeen (17) nominees for director. Except as otherwise indicated, (i) each
of the named persons has been engaged in his or her present principal
occupation for more than five years and (ii) each nominee has been a director
of the Company since its organization in 1996. Stock ownership and other
information is as of March 31, 1999.
NOMINEES FOR DIRECTOR AND CONTINUING DIRECTORS
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY
OWNED
NAME (AGE) BUSINESS INFORMATION (PERCENTAGE)(1)
- ---------- -------------------- ---------------
<S> <C> <C>
Catherine M. Amos Ms. Amos, a native of Forsyth County, Georgia, has 19,500(2)
(47) been the President of Amos Properties, Inc., an (2.44)%
owner of commercial real estate properties, since
1989, and the Secretary and Treasurer and co-owner
of Amos Plumbing & Electrical Co., Inc., a
contracting firm, since 1975. Ms. Amos is a member
of the Lake Lanier Islands Authority as well as a
member of several other civic, social and community
organizations. Ms. Amos is also a director of the
Bank.
Jeffrey S. Bagley Mr. Bagley, a native of Forsyth County, Georgia, has 5,000
(37) been a Judge for the State Court of Forsyth County (*)
since 1997. Mr. Bagley was a partner with the law
firm of Boling, Rice, Bettis, Bagley, & Martin from
1992 until 1997. He is a member of the Rotary Club
of South Forsyth County as well as several other
civic and social organizations. Mr. Bagley is also a
director of the Bank.
Danny M. Bennett Mr. Bennett, a native of Forsyth County, Georgia, 10,000(3)
(38) is the President of GeoCorp Development Co., Inc., a (1.25%)
land development company located in Cumming,
Georgia. He is also a Vice President and
Construction Engineer with Georgia North
Contracting, Inc. Mr. Bennett has been an officer of
each of these companies since 1988. Mr. Bennett is
also a director of the Bank.
</TABLE>
3
<PAGE> 7
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY
OWNED
NAME (AGE) BUSINESS INFORMATION (PERCENTAGE)(1)
- ---------- -------------------- ---------------
<S> <C> <C>
Michael P. Bennett Mr. Bennett is a resident of Forsyth County, Georgia 7,500(4)
(55) and is on the Board of Directors for Forsyth County (*)
Farm Bureau. Mr. Bennett is also the Chief Financial
Officer and Secretary of 5 Bennett Farms, Inc. and
served on the Forsyth County Commission from 1987 to
1994. Mr. Bennett has been a self-employed farmer
since 1975. Mr. Bennett is also a director of the
Bank.
Bryan L. Bettis Mr. Bettis, a native of Forsyth County, Georgia, has 5,000(5)
(37) been the Vice President of Midway Building Supply, (*)
Inc. in Alpharetta, Georgia, since 1978. Mr. Bettis
is also the President of Bettis Construction, Inc.,
a residential construction company, and a member of
the Rotary Club of South Forsyth County.
Talmadge W. Bolton Mr. Bolton, a native of Forsyth County, Georgia, has 10,000(6)
(65) been the Chief Executive Officer of Bolton's Truck (1.25)%
Parts, Inc., since 1978. He is a member of Lafayette
Masonic Lodge No. 44 and a board member of the
Forsyth County Department of Family & Children
Services and the Forsyth County Zoning Department.
Mr. Bolton is also a director of the Bank.
Thomas L. Bower III Mr. Bower has been a resident of Gainesville, 10,000
(47) Georgia for 23 years. Mr. Bower is the (1.25)%
Secretary/Treasurer of Clipper Petroleum, Inc. with
whom he has been associated since 1974, and a
partner in B&B Associates, a real estate and
convenience store partnership. Mr. Bower also serves
on the Board of Directors for the Hall County Humane
Society.
Charles R. Castleberry Mr. Castleberry, a native of Forsyth County, 5,000(7)
(45) Georgia, has been employed by Progressive Lighting, (*)
Inc. as a manager and representative since 1985. Mr.
Castleberry is a member of the Rotary Club of South
Forsyth County, a member and past director of the
Cumming Chamber of Commerce, and past Chairman of
the Board for the Forsyth County Planning and
Development Board.
David H. Denton Mr. Denton is a resident of Forsyth County, Georgia 5,800(8)
(53) and has over 32 years of banking experience in the (*)
State of Georgia. He served as Senior Vice President
of The Peoples Bank of Forsyth County from 1990
through June 1996. Mr. Denton is a member of the
Rotary Club of South Forsyth, the Forsyth Central
Band Boosters, the Cumming First United Methodist
Church, and the Boy Scouts of America where he
serves on the Executive Board of the Northeast
Georgia Council. Mr. Denton is the President and
Chief Executive Officer of both the Company and the
Bank as well as a director of the Bank. He has held
his positions with the Company and the Bank since
inception.
</TABLE>
4
<PAGE> 8
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY
OWNED
NAME (AGE) BUSINESS INFORMATION (PERCENTAGE)(1)
- ---------- -------------------- ---------------
<S> <C> <C>
Charles D. Ingram Mr. Ingram, a native of Forsyth County, Georgia, has 5,000
(56) been a co-owner and President of I & S Investments, (*)
Inc. since 1989. Mr. Ingram was formerly the
President of Forsyth County Bank and served on the
advisory board for Wachovia Bank. Mr. Ingram is also
a director of the Bank.
Herbert A. Lang, Jr. Mr. Lang is a long-time resident of Forsyth County 10,000
(47) and has been the owner of Lang Signs, a sign (1.25)%
manufacturer, since 1973. He is a member of the
Rotary Club of South Forsyth County. Mr. Lang is
also a director of the Bank.
John P. McGruder Dr. McGruder is a resident of Cumming, Georgia and 10,000(9)
(57) has been the co-owner of Crestview Animal Hospital (1.25)%
since 1984. He is also a member of the Cumming First
United Methodist Church where he serves on the
Building Committee.
James J. Myers Mr. Myers is a resident of Forsyth County, Georgia 7,500(10)
(49) and has been the owner of James J. Myers, CPA, PC (*)
since 1991. Mr. Myers has been a CPA since 1976 and
is a member of the Cumming Forsyth Optimist Club and
Leadership Forsyth. Mr. Myers is Chairman of the
Company's Board of Directors and also Chairman of
the Board of Directors of the Bank.
Danny L. Reid Mr. Reid, a native of Forsyth County, Georgia, has 10,000(11)
(46) been a co-owner of Reid & Reid Grading and Pipeline, (1.25)%
Inc., a grading contractor and developer, since
1982. Mr. Reid is also a director of the Bank.
Charles R. Smith Mr. Smith is a resident of Forsyth County and has 25,000(12)
(70) presided as a Judge of the Municipal Court of (3.13)%
Cumming, Georgia, since 1992. Mr. Smith is a retired
former partner of Smith & Smith, Attorneys at Law,
with whom he was a partner since 1956. He was an
organizer, director and former Chairman of the Board
of The Peoples Bank of Forsyth County. Mr. Smith is
also a director of the Bank.
Wyatt L. Willingham Mr. Willingham is a resident of Cumming, Georgia and 7,500(13)
(46) is the Vice ) President and General Manager of North (*)
Georgia Fast Foods, Inc., with which he has been
associated since 1973. Mr. Willingham is a member of
the Mount Zion Lodge and the Yaarab Temple. Mr.
Willingham is also a director of the Bank.
Jerry M. Wood Mr. Wood is a long-time resident of Forsyth County 5,000(14)
(50) and has been the President and owner of Wood Ace (*)
Hardware Company since 1980. Mr. Wood is a founding
member of the Rotary Club of South Forsyth County
and has served as Chairman of Finance, Chairman of
the Trustees, and Secretary of the Building
Committee of the Midway United Methodist Church.
</TABLE>
5
<PAGE> 9
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY
OWNED
NAME (AGE) BUSINESS INFORMATION (PERCENTAGE)(1)
- ---------- -------------------- ---------------
<S> <C> <C>
Jimmy S. Fagan Mr. Fagan is the Executive Vice President of the 10,000(15)
(62) Company and also the Executive Vice President of the (1.25)%
Bank, and has held these positions with the Company
and the Bank since their inception. He is a
long-time resident of Cumming, Georgia and has over
33 years of banking experience in Forsyth County,
Georgia. Prior to joining the Company, he served as
Vice Chairman and President of The Peoples Bank of
Forsyth County, with which he was associated since
1984. He is a member of the Rotary Club of South
Forsyth County and the Forsyth Development
Authority.
Holly R. Hunt Mrs. Hunt is the Vice President, Secretary and - 0 -
(40) Treasurer of the Company. Mrs. Hunt is also the (*)
Chief Financial Officer of the Bank. She has been an
officer of the Company and the Bank since November
1998. Mrs. Hunt is a resident of Cleveland, Georgia
and has over 14 years of banking experience in the
State of Georgia. Prior to joining the Company, she
was an independent bank consultant from June 1997 to
November 1998 and Vice President and Internal
Auditor for Regions Bank, formerly Metro Bank, from
October 1994 to July 1997.
Timothy M. Perry Mr. Perry is the Senior Lending Officer and Senior 2,000(16)
(37) Vice President of the Bank. He is a resident of (*)
Cumming, Georgia and has over 18 years of banking
experience in the State of Georgia. Mr. Perry has
been an officer of the Bank since its inception in
1997. Prior to joining the Bank, he was Senior Vice
President/Senior Credit Officer of Barrow Bank &
Trust Company from 1995 through June 1996 and Vice
President, Commercial Lending of The Peoples Bank of
Forsyth County from 1986 through 1995.
DIRECTORS AND OFFICERS AS A GROUP (20 PERSONS) 169,800
(21.23)%
</TABLE>
- ---------------------------
(1) Information relating to beneficial ownership of Company Common Stock
is based upon information furnished by each person using "beneficial
ownership" concepts set forth in the rules of the Securities and
Exchange Commission. Under those rules, a person is deemed to be 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," which includes the power to dispose
of or to direct the disposition of such security. The person is also
deemed to be a beneficial owner of any security of which that person
has a right to acquire beneficial ownership within 60 days. Under
those rules, more than one person may be deemed to be a beneficial
owner of the same securities, and a person may be deemed to be a
beneficial owner of securities as to which he or she may disclaim any
beneficial interest. Accordingly, directors are named as beneficial
owners of shares as to which they may disclaim any beneficial
interest.
(2) Includes 11,500 Shares owned jointly with Ms. Amos' husband, as to
which Shares Ms. Amos may be deemed to share voting and investment
power.
(3) Includes 5,000 Shares owned jointly with Mr. Bennett's wife, as to
which Shares Mr. Bennett may be deemed to share voting and investment
power.
(4) All 7,500 Shares are owned jointly with Mr. Bennett's wife, and Mr.
Bennett may be deemed to share voting and investment power.
6
<PAGE> 10
(5) All 5,000 Shares are owned jointly with Mr. Bettis' business partner
and Mr. Bettis may be deemed to share voting and investment power.
(6) All 10,000 Shares are held by the trustee for the Talmadge W. Bolton
Living Trust.
(7) All 5,000 Shares are owned jointly with Mr. Castleberry's wife, and
Mr. Castleberry may be deemed to share voting and investment power.
(8) Includes 5,000 Shares held by the trustee for the IRA of Mr. Denton,
200 Shares owned jointly with Mr. Denton's wife, and 600 Shares held
by Mr. Denton's three children, as to which Shares Mr. Denton may be
deemed to share voting and investment power.
(9) All 10,000 Shares are owned jointly with Mr. McGruder's wife, and Mr.
McGruder may be deemed to share voting and investment power.
(10) Includes 2,500 Shares held by the trustee for the IRA of Mr. Myers.
(11) Includes 5,000 Shares owned jointly with Mr. Reid's wife, as to which
Shares Mr. Reid may be deemed to share voting and investment power.
(12) All 25,000 Shares are owned jointly with Mr. Smith's wife, and Mr.
Smith may be deemed to share voting and investment power.
(13) All 7,500 Shares are owned jointly with Mr. Willingham's wife, and Mr.
Willingham may be deemed to share voting and investment power.
(14) Includes 3,000 Shares owned jointly with Mr. Wood's wife and 2,000
Shares owned jointly with Mr. Wood's daughter, as to which Shares Mr.
Wood may be deemed to share voting and investment power.
(15) All 10,000 Shares are owned jointly with Mr. Fagan's wife, and Mr.
Fagan may be deemed to share voting and investment power.
(16) Includes 1,000 Shares owned jointly with Mr. Perry's wife, as to which
Shares Mr. Perry may be deemed to share voting and investment power.
(*) Less than one percent.
None of the members of Board of Directors are related, except that
John P. McGruder's wife is a first cousin to Catherine M. Amos.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company conducts its business through
meetings of the full Board and through joint committees of the Boards of
Directors of the Company and the Bank, including an Audit Committee, Investment
Committee, Loan Committee and Personnel Committee. During 1998, the full Board
of Directors held ten (10) meetings, the Audit Committee held three (3)
meetings, the Investment Committee held two (2) meetings, the Loan Committee
held forty-one (41) meetings, and the Personnel Committee held two (2)
meetings. With the exception of Bryan L. Bettis, Thomas L. Bower, III and Jerry
M. Wood, each director attended at least 75% of all meetings of the full Board
of Directors and of each committee of the Board of which he is a member.
The Audit Committee is responsible for reviewing with the Company's
independent accountants, their audit plan, the scope and results of their audit
engagement and the accompanying management letter, if any; reviewing the scope
and results of the Company's internal auditing procedures; consulting with the
independent accountants and management with regard to the Company's accounting
methods and the adequacy of the Company's internal accounting controls;
approving professional services provided by the independent accountants;
reviewing the independence of the independent accountants; and reviewing the
range of the independent accountants' audit and non-audit fees. During 1998,
the Audit Committee was composed of Catherine M. Amos, Michael P. Bennett,
Talmadge W. Bolton, James J. Myers and Charles R. Smith. Effective January 1,
1999, the Audit Committee members for fiscal year 1999 are Catherine M. Amos,
Jeffrey S. Bagley, James J. Myers and Charles R. Smith.
7
<PAGE> 11
The Investment Committee is responsible for ensuring that guidelines
provided by them in the investment policy are carried out by management. During
1998, the Investment Committee was composed of Jeffrey S. Bagley, Danny M.
Bennett, Herbert A. Lang, Jr., James J. Myers and Danny L. Reid. Effective
January 1, 1999, the Investment Committee members for the fiscal year 1999 are
Danny M. Bennett, Talmadge W. Bolton, Herbert A. Lang, and John P. McGruder.
The Loan Committee is responsible for ensuring that policy and
regulation guidelines are adhered to by lending personnel. Loans in excess of
the lending limits of personnel are reviewed and approved by the committee.
During 1998, the Loan Committee was composed of Michael P. Bennett, Charles D.
Ingram, John P. McGruder, James J. Myers and Wyatt L. Willingham. Effective
January 1, 1999, Danny L. Reid has taken the place of John P. McGruder as a
member of the Loan Committee.
The Personnel Committee is responsible for setting the compensation
and benefits of the executive officers and other employees of the Company and
the Bank. The Personnel Committee is composed of Jeffrey S. Bagley, Charles D.
Ingram and James J. Myers.
The Board of Directors as a whole functions as a nominating committee
to select management's nominees for election as directors of the Company. The
Board of Directors will consider nominees recommended by shareholders if
submitted to the Company in accordance with the procedures set forth in Section
3.8 of the Bylaws of the Company. For more information on nomination
procedures, see "Shareholders' Proposals and Nomination Procedures for the
Annual Meeting of Shareholders in 2000" below.
DIRECTOR COMPENSATION
During 1998, the directors did not receive any compensation for
attending Company or Bank Board of Directors meetings or meetings of committees
of the Board of Directors. Effective January 1, 1999, directors, who are not
employees of the Company or the Bank, will begin receiving compensation.
Directors will receive $100 for each Bank Board of Directors meeting attended
and $25 for each committee meeting attended.
COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of March 31, 1999, the 20 directors and executive officers of the
Company beneficially owned 169,800 Shares or 21.23% of the Common Stock of the
Company. The Company is unaware of any person that beneficially owns more than
five percent (5%) of the Company's Common Stock. For information regarding the
beneficial ownership of the Company's Common Stock as of March 31, 1999 by each
of the Company's directors, director nominees and executive officers, see
"Proposal One - Election of Directors - Information Regarding Nominees and
Continuing Directors."
8
<PAGE> 12
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION OF EXECUTIVE OFFICERS
Under rules established by the Securities and Exchange Commission (the
"SEC"), the Company is required to provide certain data and information in
regard to the compensation and benefits provided to the Company's Chief
Executive Officer and four other most highly compensated executive officers who
receive compensation in excess of $100,000 per year (collectively, the "Named
Executive Officers"). For purposes hereof, only David H. Denton, the Company's
President and Chief Executive Officer, and Jimmy S. Fagan, the Company's
Executive Vice President, earned over $100,000 in salary and bonus during 1998,
or for any other period since the Company's inception. The following table
summarizes by various categories, for the fiscal years ended December 31, 1998,
1997 and 1996, the total compensation paid by the Company to its Named
Executive Officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION (1)
-----------------------------------
ALL OTHER
NAME AND POSITION YEAR SALARY BONUS COMPENSATION (2)
----------------- ---- ------ ----- ----------------
<S> <C> <C> <C> <C>
David H. Denton 1998 $98,000 0 $1,440
President and 1997 96,974 0 1,440
Chief Executive Officer 1996 41,083 0 --
Jimmy S. Fagan 1998 108,900(3) 0 170
Executive Vice President 1997 108,900(3) 0 170
1996 18,150 0 --
</TABLE>
- -------------------
(1) Excludes perquisites and other personal benefits, the aggregate amount
of which did not, in the case of any Named Executive Officer, exceed
$50,000 or 10% of such Named Executive Officer's annual salary and
bonus in any year.
(2) This amount represents the dollar value of excess life insurance
benefits received by the Named Executive Officer in each year.
(3) Includes $11,400 of compensation earned in each of 1998 and 1997,
which was deferred by Mr. Fagan in accordance with his Executive
Deferred Compensation Agreement.
EMPLOYMENT AGREEMENT WITH DAVID H. DENTON
David H. Denton and the Company have entered into an employment
agreement pursuant to which Mr. Denton serves as the President and Chief
Executive Officer of the Company and the Bank. The employment agreement
provides for a salary of $98,000 plus annual medical insurance premium. Mr.
Denton is eligible to participate in any management incentive program of the
Company or the Bank or any long-term equity incentive program and will be
eligible for grants of stock options and other awards thereunder. Additionally,
Mr. Denton may participate in the Company's or the Bank's retirement, welfare
and other benefit programs and is entitled to reimbursement for automobile
expenses and travel and business expenses. The Company maintains a key man life
insurance policy on Mr. Denton providing for death benefits in the amount of
$600,000 payable to the Company and $400,000 payable to Mr. Denton's family.
9
<PAGE> 13
The employment agreement provides for an initial term of five years,
beginning on June 28, 1996, and can be extended by the Company at the end of
each year for an additional year, so that the remaining term shall continue to
be five years. If the Company terminates Mr. Denton's employment without cause
or if Mr. Denton's employment is terminated due to a sale, merger or
dissolution of the Company or the Bank, the Company will be obligated to
continue his salary and bonus for the first twelve months. Furthermore, in such
cases, the Company must remove any restrictions on outstanding incentive awards
so that all such awards vest immediately and the Company must continue to
provide his life insurance and medical benefits until he reaches the age of 65.
In addition, the employment agreement provides that following
termination of his employment with the Company and for a period of twelve
months thereafter, Mr. Denton may not: (i) be employed in the banking business
as a director, officer at the vice president level or higher, or organizer or
promoter of, or provide executive management services to, any financial
institution within Forsyth County; or (ii) solicit employees of the Bank for
employment.
The Company has not entered into an Employment Agreement with any
other officer or employee of the Company or the Bank.
BANK 401(K) PLAN
The Bank established, effective January 1, 1998, a qualified salary
deferral plan pursuant to Section 401(k) of the Internal Revenue Code (the
"401(k) Plan"). The 401(k) Plan is open to all employees, including executive
officers, beginning on the first day of their employment with the Bank.
Pursuant to the 401(k) Plan, each participating employee is permitted to
authorize payroll deductions of up to 6% of his or her total compensation
during the calendar year (the "Basic Contributions"), and is permitted to make
supplemental contributions of up to 10% of his or her total compensation during
the calendar year (the "Supplemental Contributions"). An employee's aggregate
contributions are subject to limits set by law. The Bank may, but is not
required to, make matching contributions in cash or the Company's Common Stock
equal to 20% of each participant's Basic Contributions. During 1998, the Bank
did not make any matching contributions to the 401(k) Plan. However, matching
contributions to the 401(k) Plan may be made in the future at the discretion of
the Bank's Board of Directors. Participants are immediately 100% vested in
their Basic and Supplemental Contributions.
EXECUTIVE DEFERRED COMPENSATION AGREEMENTS
The Company has deferred compensation agreements with certain of the
Company's executive officers under which each executive has agreed to reduce
his salary in exchange for annual benefits upon retirement. Amounts of
compensation deferred pursuant to the deferred compensation agreements are
included in the salaries of the Named Executive Officers disclosed in the
Summary Compensation Table in the year such compensation is earned. Such
compensation will not be included in such individual's salary in the Summary
Compensation Table in the later year in which he actually receives such
compensation. The Named Executive Officers are entitled to the following
amounts upon retirement or attaining age 65 under such deferred compensation
agreements: Jimmy S. Fagan - $11,400 annually.
Each of the deferred compensation agreements provide that in the event
of a change of control of the Company (as defined in the agreements), the
officer (i) if he has not yet qualified for early
10
<PAGE> 14
retirement benefits, shall have the right to demand his withdrawal benefits
(which is an amount approximately equal to the amount of salary deferred under
the agreement by the officer) in a single lump sum payment, or (ii) if he has
qualified for early retirement benefits or has begun receiving a retirement
benefit under his deferred compensation agreement, shall have the right to
demand his benefits in a single lump sum payment in an amount equal to the
annual amount to which the officer is entitled times the number of years
remaining in his life expectancy based on the actuarial assumptions used in
connection with the Company's Pension Plan at that time, reduced to present
value using 6% per annum.
CERTAIN TRANSACTIONS AND BUSINESS RELATIONSHIPS
Directors, executive officers and principal shareholders of the
Company and the Bank and their affiliates have been customers of the Bank from
time to time in the ordinary course of business, and additional transactions
are expected to take place in the future. In accordance with applicable federal
laws and regulations, all loans by the Bank to such persons are made on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons, do not
involve more than the normal risk of collectability or embody other unfavorable
features, and comply with specified quantitative limits imposed by such federal
laws and regulations. At December 31, 1998, the aggregate amount of loans and
extensions of credit outstanding to such persons was approximately $1,776,000
which represented 26.64% of the total equity capital of the Bank as of such
date. Deposit accounts with Company and Bank officers, directors and their
affiliates totaled $3,406,000 at December 31, 1998.
None of the Bank's loans outstanding at any time during or subsequent
to 1998 to directors, executive officers or principal shareholders of the
Company or the Bank or their associates is or has been on past due or
non-accrual status, has been restructured, or is considered by the Bank to be a
problem loan.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than 10%
of the Company's Common Stock, to file with the SEC initial reports of
ownership and reports of changes in ownership of Common Stock and other equity
securities of the Company. Directors, executive officers, and greater than 10%
shareholders are required by SEC regulation to furnish the Company with copies
of all 16(a) reports they file. To the Company's knowledge, based solely on a
review of the copies of such reports furnished to the Company and written
representations that no other reports were required, during the fiscal year
ended December 31, 1998, all Section 16(a) filing requirements applicable to
directors, executive officers, and greater than 10% beneficial owners were
complied with by such persons.
EXPENSES OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. In
addition to solicitations by mail, officers, directors, and regular employees
of the Company may solicit proxies personally or by telephone, telegraph or
other means without additional compensation. The Company will reimburse
brokers, fiduciaries, and custodians for their costs in forwarding proxy
materials to beneficial owners of Common Stock held in their names.
11
<PAGE> 15
INDEPENDENT PUBLIC ACCOUNTANTS
On March 17, 1998, the Company appointed Mauldin & Jenkins, LLC as the
Company's independent public accountants and dismissed the Company's former
auditors, Porter Keadle Moore, LLP. The decision to change accountants was
unanimously approved by the Company's Board of Directors. There were no
disagreements with the former auditors on any matter of accounting principles
or practices, financial statement disclosure or auditing scope or procedure
with respect to the Company's financial statements for the fiscal year ended
December 31, 1997 or through the time of replacement.
Mauldin & Jenkins, LLC acted as the Company's independent public
accountants for the fiscal year ended December 31, 1998. Representatives of
Mauldin & Jenkins, LLC will be present at the Annual Meeting with the
opportunity to make a statement if they desire to do so and will be available
to answer questions concerning the financial affairs of the Company.
SHAREHOLDERS' PROPOSALS AND NOMINATION PROCEDURES
FOR THE ANNUAL MEETING OF SHAREHOLDERS IN 2000
Director nominations and other proposals of shareholders intended to
be presented at the Annual Meeting of Shareholders in 2000 must be submitted to
the Company in accordance with the procedures set forth in Section 3.8 of the
Bylaws of the Company and in accordance with applicable rules of the SEC. The
effect of those provisions is that shareholders must submit such nominations
and proposals, together with certain related information specified in the
above-referenced section of the Bylaws, in writing to the Company on or before
December 30, 1999 in order for such matters to be included in the Company's
proxy materials for, and voted upon at, the 2000 Annual Meeting. All such
proposals, nominations and related information should be submitted on or before
such date by certified mail, return receipt requested, to the Secretary of the
Company, Holly R. Hunt, 501 Tri-County Plaza, Cumming, Georgia 30040. A copy of
the above-referenced section of the Bylaws will be provided upon request in
writing to the Secretary of the Company at such address.
Pursuant to Section 3.8 of its Bylaws, the Company has established
certain nomination requirements for an individual to be elected as a director
of the Company at any annual or special meeting of the shareholders. These
requirements include, but are not limited to, the requirement that the
nominating shareholder provide the Company: (i) notice of any proposed director
within certain time frames; (ii) the name and certain biographical information
on the nominee; and (iii) the notice be accompanied by a sworn or certified
statement by the shareholder which indicates that the nominee has consented to
the nomination and that the shareholder believes that the nominee will stand
for election and will serve if elected. The chairman of any meeting of the
shareholders may, for good cause shown and with proper regard for the orderly
conduct of the meeting, waive in whole or in part the operation of Section 3.8
of the Company's Bylaws. These provisions could reduce the likelihood that a
third party could nominate and elect individuals to serve on the Company's
Board of Directors.
12
<PAGE> 16
OTHER MATTERS
The management of the Company does not know of any matters to be
presented at the Annual Meeting other than those mentioned in this Proxy
Statement. If any other matters properly come before the Annual Meeting, the
persons designated as proxies will vote on such matters in accordance with
their best judgment.
The management of the Company urges you to attend the Annual Meeting
and to vote your Shares in person. Whether or not you plan to attend, please
sign and promptly return your proxy. Your proxy may be revoked at any time
before it is voted. Such proxy, if executed and returned, gives discretionary
authority with respect to any other matters that may come before the Meeting.
ANNUAL REPORT ON FORM 10-KSB
Upon the written request of any person whose proxy is solicited by
this Proxy Statement, the Company will furnish to such person without charge
(other than for exhibits) a copy of the Company's Annual Report on Form 10-KSB
for the fiscal year ended December 31, 1998, including financial statements and
schedules thereto, as filed with the SEC. Requests may be made to Forsyth
Bancshares, Inc., 501 Tri-County Plaza, Cumming, Georgia 30040, Attention:
Holly R. Hunt, Secretary of the Company.
By Order of the Board of Directors,
/s/ David H. Denton
DAVID H. DENTON
President & Chief Executive Officer
Cumming, Georgia
April 28, 1999
<PAGE> 17
PROXY
FORSYTH BANCSHARES, INC.
ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints David H. Denton and James J. Myers, or either of
them, each with full power of substitution as proxies to vote the stock of the
undersigned at the Annual Meeting of Shareholders of Forsyth Bancshares, Inc.
(the "Company") to be held at the Sawnee Community Center on May 18, 1999 at
10:00 a.m., local time, and at any and all adjournments or postponements thereof
(the "Annual Meeting").
1. ELECTION OF DIRECTORS
<TABLE>
<S> <C>
[ ] FOR ALL NOMINEES FOR DIRECTOR LISTED BELOW. [ ] WITHHOLD AUTHORITY
(except as marked to the contrary below) (to vote for all nominees listed)
</TABLE>
Catherine M. Amos, Jeffrey S. Bagley, Danny M. Bennett, Michael P. Bennett,
Bryan L. Bettis, Talmadge W. Bolton, Thomas L. Bower III, Charles R.
Castleberry, David H. Denton, Charles D. Ingram, Herbert A. Lang, Jr., John P.
McGruder, James J. Myers, Danny L. Reid, Charles R. Smith, Wyatt L. Willingham
and Jerry M. Wood.
To withhold authority to vote for any individual nominee, write that nominee's
name in the space provided below.
- --------------------------------------------------------------------------------
(Continued and to be signed on reverse)
2. IN THE DISCRETION OF THE PROXIES ON SUCH OTHER MATTERS AS MAY PROPERLY COME
BEFORE THE MEETING OR ANY ADJOURNMENTS THEREOF.
[ ] AUTHORIZED [ ] NOT AUTHORIZED
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED SHAREHOLDER AND IN THE DISCRETION OF THE PROXIES. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED "FOR" EACH OF THE PROPOSALS AND WITH
DISCRETIONARY AUTHORITY ON ALL OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE
MEETING.
Dated , 1999
------------------------------
------------------------------
------------------------------
Signature(s) of Shareholder(s)
Please date and sign this
proxy exactly as the names
appear hereon. In the case of
joint tenants, each joint
owner should sign. If a
corporation, please sign in
full corporate name by
president or other authorized
officer. When signing as
attorney, executor, trustee,
administrator or guardian,
please give full title as
such. If a partnership, please
sign in partnership name by
authorized person.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
AND MAY BE REVOKED BY THE SHAREHOLDER PRIOR TO ITS EXERCISE
