As filed with the Securities and Exchange Commission on
December 5, 1996 Registration No. 333-13583
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 2 TO
FORM SB-2
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
FIRST GEORGIA COMMUNITY CORP.
(Name of Small Business Issuer in its Charter)
GEORGIA 6712 58-2261088
(State or other juris- (Primary Standard I.R.S. Employer
diction of incorporation Industrial Classi- Identification
or organization) fication Code Number) No.)
150 Covington Street
P. O. Box 1534
Jackson, Georgia 30233
(770) 504-1090
________________________________________________________________
(Address and telephone number of principal executive offices
including zip code)
150 Covington Street
P. O. Box 1534
Jackson, Georgia 30233
(770) 504-1090
________________________________________
(Address of principal place of business or
intended principal place of business)
Copy to:
John L. Coleman T. Treadwell Syfan
150 Covington Street Stewart, Melvin & Frost, LLP
P. O. Box 1534 200 Main Street
Jackson, Georgia 30233 P. O. Box 3280
(770) 504-1090 Gainesville, Georgia 30503
(770) 563-0101
(Name, address and
telephone number, of
agent for service)
Approximate date of proposed sale to the public; As soon as
practicable after this Registration Statement becomes effective.
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration
number of the earlier effective registration statement for the
same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check this following box and list
the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If the delivery of the prospectus is expected to be made pursuant
to Rule 434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE:
<TABLE>
<S> <C> <C> <C> <C>
Title of Amount to be Proposed Maximum Proposed Maximum Amount of
Each Class Registered Offering Price Aggregate Offering Registration
of Securities per Unit Price Fee
Common Stock 800,000 Shares $10.00 $8,000,000 $2,758.621
$5.00 par value
</TABLE>
The Registrant hereby amends this Registration Statement on such
date or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment which specifically states
that this Registration Statement shall become effective on such date as
the Commission, acting pursuant to said Section 8(a), may determine.
_______________________________________
1$2,413.79 was paid upon filing of the original Registration Statement,
with $344.83 being paid with Amendment No. 1.
Exhibit Index on page ______ Page 1 of ______
<PAGE>
FIRST GEORGIA COMMUNITY CORP.
CROSS-REFERENCE SHEET
Registration Statement Item Caption in Prospectus
Number and Heading
1. Front of the Registration
Statement and Outside
Front Cover Page
of Prospectus................ Cover page; Outside
Front Cover Page
of Prospectus
2. Inside Front and Outside
Back Cover Pages of
Prospectus................... Inside Front Cover
Page of Prospectus;
Additional
Information; Outside
Back Cover Page of
Prospectus
3. Summary Information and
Risk Factors................. Summary; Risk Factors
4. Use of Proceeds............. Use of Proceeds
5. Determination of
Offering Price.............. Risk Factors
6. Dilution.................... Not Applicable
7. Selling Security Holders.... Not Applicable
8. Plan of Distribution........ Terms of the Offering
9. Legal Proceedings........... Not Applicable
10. Directors, Executive
Officers, Promoters
and Control Persons.......... Management - Proposed
Directors and Officers
11. Securities Ownership
of Certain Beneficial
Owners and Management....... Management - Proposed
Directors and Officers
Registration Statement Item
and Heading Caption in Prospectus
12. Description of the
Securities.................. Dividends; Description of
Common Stock of the
Company; Certain Provisions
of the Company's Articles
of Incorporation and Bylaws
13. Interests of Named
Experts and Counsel......... Not Applicable
14. Disclosure of Commission
Position on Indemnification
for Securities Act
Liabilities.................. Certain Provisions of the
Company's Articles
of Incorporation and
Bylaws Indemnification
15. Organization Within
Last Five Years.............. Management
16. Description of Business..... Summary; Business;
Supervision and Regulation
17. Management's Discussion
and Analysis or Plan
of Operation.................... Business
18. Description of Property..... Business - Facilities
19. Certain Relationships
and Related Transactions..... Management- Certain
Transactions
20. Market for Common
Equity and Related
Stockholder Matters.......... Description of Common Stock
of the Company
<PAGE>
Registration Statement Item
and Heading Caption in Prospectus
21. Executive Compensation...... Management
22. Financial Statements........ Balance Sheet of First
Georgia Community Corp.
23. Changes in and
Disagreement With
Accountants on Accounting
and Financial Disclosure.... Not Applicable
<PAGE>
PROSPECTUS
FIRST GEORGIA COMMUNITY CORP.
A Proposed Bank Holding Company for
FIRST GEORGIA COMMUNITY BANK (In Organization)
800,000 Shares of Common Stock
(Par Value $5.00 Per Share)
(Minimum Purchase: 100 Shares)
This Prospectus relates to the offering by FIRST GEORGIA
COMMUNITY CORP., a Georgia corporation (the "Company"), of a
minimum of 610,000 shares and a maximum of 800,000 shares of its
Common Stock, $5.00 par value per share (the "Common Stock"), at
$10.00 per share. The Company has been organized to hold, upon
receipt of regulatory approvals, all of the common stock of First
Georgia Community Bank (In Organization) (the "Bank"), Jackson,
Georgia. The organizers (the directors) of the Company and the
Bank intend to subscribe for an aggregate of at least 165,000 of
the shares of Common Stock sold in this offering (27% of the
minimum and 20.6% of the maximum number of shares to be sold). In
the event that the minimum number of shares in this offering are
not sold, the organizers may acquire additional shares of Common
Stock, up to a maximum aggregate number for all organizers of
304,700 shares (49.95% of the minimum and 38.1% of the maximum
number of shares to be sold). The organizers of the Company will
not be granted options or warrants in connection with the formation
of the Company; instead, the organizers will be entitled to
purchase shares on the same basis as all other investors. The
Company and the Bank have not conducted active business operations.
The commencement of business operations is contingent upon various
regulatory approvals by state and federal agencies and the sale of
a minimum of 610,000 shares of the Common Stock offered hereby.
All subscriptions are binding and irrevocable until the "Expiration
Date" as defined herein. In the event (a) that the Company is
unable to sell 610,000 shares of Common Stock or (b) that the
Company and the Bank do not satisfy, or do not make a determination
that they will satisfy, the conditions included in their respective
regulatory approvals, the organizers of the Company will pay all
incurred expenses, and all escrowed subscription proceeds will be
returned to investors with interest. See "THE OFFERING - Release
from Escrow" - Page 6.
INVESTMENT IN THESE SECURITIES INVOLVES A SUBSTANTIAL
DEGREE OF RISK. SEE "RISK FACTORS."
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
Price to Underwriting Discounts Proceeds to
Public(1) and Commissions(2) Company(3)
<S> <C> <C> <C>
Per Share $ 10.00 -0- $ 10.00
Total Minimum(4) $6,100,000 -0- $6,100,000
Total Maximum(5) $8,000,000 -0- $8,000,000
</TABLE>
(1) The offering price has been arbitrarily established by the
Company. See "RISK FACTORS - Offering Price."
(2) Offers and sales of the Common Stock will be made on behalf of
the Company on a best-efforts basis by its officers and
directors, who will receive no commissions or other remuneration
in connection with such activities, but they will be reimbursed
for their reasonable expenses incurred in the offering. In
reliance on Rule 3a4-1 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), the Company believes such
officers and directors will not be deemed to be brokers and/or
dealers under the Exchange Act.
(3) Before deduction of expenses payable by the Company estimated at
$35,000 for registration fees, legal and accounting fees,
printing costs and other offering expenses.
(4) Subscription proceeds will be deposited promptly in an escrow
account with The Bankers Bank, Atlanta, Georgia, pending
receipt of subscriptions for not less than 610,000 shares and
completion of certain other matters on or before
_______________, 1996, the expiration date of the offering
(unless the offering is terminated sooner or extended).
Subscription funds will be released from escrow (a) upon the
receipt of $6,100,000 of subscription proceeds and (b) upon a
determination by the organizers that the remaining conditions
set forth in the preliminary approvals issued by the applicable
regulatory agencies will be satisfied. See "THE OFFERING -
Terms of the Offering." The Company will return to each
subscriber, with interest, the amount of any proceeds received
in full with respect to subscriptions that are not accepted.
(5) The Company reserves the right to issue up to 800,000 shares at
$10.00 per share. See "THE OFFERING - Terms of the Offering."
The date of this Prospectus is____________________, 1996.
REPORTS TO SHAREHOLDERS
The Company is not a reporting company as defined by the
Securities and Exchange Commission ("SEC"). The Company will
furnish its shareholders with annual reports containing audited
financial information for each fiscal year on or before the date of
the annual meeting of shareholders as required by Rule 80-6-1.05 of
the Georgia Department of Banking and Finance ("Department of
Banking"). The Company's fiscal year ends on December 31.
Additionally, the Company will also furnish such other reports as
it may determine to be appropriate or as otherwise may be required
by law.
Upon the effective date of the Registration Statement, the
Company will be subject to the reporting requirements of the
Securities Exchange Act of 1934 (the "Exchange Act"), which include
requirements to file annual reports on Form 10-K and quarterly
reports on Form 10-Q with the SEC. This reporting obligation will
exist for at least one year and will continue for fiscal years
thereafter, except that such reporting obligations may be suspended
for any subsequent fiscal year if at the beginning of such year the
Common Stock of the Company is held of record by less than three
hundred persons.
ADDITIONAL INFORMATION
The Company has filed with the SEC a Registration Statement
under the Securities Act of 1933, as amended, with respect to the
Common Stock offered hereby. This Prospectus does not contain all
of the information set forth in the Registration Statement. For
further information with respect to the Company and the Common
Stock, reference is made to the Registration Statement and the
exhibits thereto. The Registration Statement may be examined at,
and copies of the Registration Statement may be obtained at
prescribed rates from, the Public Reference Section of the SEC,
Room 1024, 450 Fifth Street, N.W., Washington, DC 20549.
The Company and the Organizers have filed or will file various
applications with the Federal Deposit Insurance Corporation, the
Federal Reserve Bank of Atlanta and the Department of Banking.
Prospective investors should rely only on information contained in
this Prospectus and in the Company's related Registration Statement
in making an investment decision. To the extent that other
available information not presented in this Prospectus, including
information available from the Company and information in public
files and records maintained by the Federal Deposit Insurance
Corporation, the Federal Reserve Bank of Atlanta and the Department
of Banking, is inconsistent with information presented in this
Prospectus or provides additional information, such other
information is superseded by the information presented in this
Prospectus and should not be relied on. Projections appearing in
the applications are based on assumptions that the organizers
believe are reasonable, but as to which no assurances can be made.
The Company specifically disaffirms those projections for purposes
of this Prospectus and cautions prospective investors against
placing reliance on them for purposes of making an investment
decision.
SUMMARY
The following Summary is qualified in its entirety by the more
detailed information appearing elsewhere in this Prospectus.
The Company
The Company was incorporated under the laws of the State of
Georgia on August 7, 1996, primarily to serve as the holding
company for a state bank and trust company. The Company is in the
process of filing applications with the Federal Reserve Bank of
Atlanta (the "Federal Reserve") for prior approval to become a bank
holding company by using the proceeds of this offering to acquire
all of the capital stock of the Bank. The organizers anticipate
receiving such approvals during January, 1997. Such approvals will
require the Company to sell at least 610,000 shares of its Common
Stock, but are not expected to contain other conditions. See "RISK
FACTORS - Regulatory Approvals Required." Following acquisition of
the Bank, the initial business of the Company will be conducted
through the Bank. See "BUSINESS OF THE COMPANY AND THE BANK."
The Bank
The Bank is in the process of being organized as a state-chartered bank and
trust company under Georgia law. It has filed
an application with the Department of Banking for this purpose and
with the Federal Deposit Insurance Corporation (the "FDIC") for
deposit insurance, and such applications were approved on
October 11, 1996 and September 30, 1996, respectively. The Bank
will not be authorized to conduct its banking business until it
receives a permit to begin business from the Department of Banking.
The issuance of the permit to begin business will depend, among
other things, upon the Bank's receiving $6,000,000 in capital from
the Company and upon compliance with certain standard conditions
that have been imposed by the FDIC and the Department of Banking
which are generally designed to familiarize the Bank with certain
applicable operating requirements (e.g., no directors' fees are
payable until the Bank earns a cumulative profit) and to prepare
the Bank to commence business operations (e.g., the adoption of
loan, investment and other policies to govern the Bank's
operations). The Bank expects to satisfy all conditions of each
requirement for organizing the Bank and to open for business during
the second quarter of 1997, or as soon thereafter as practicable.
See "RISK FACTORS - Regulatory Approvals Required" and "USE OF
PROCEEDS." The Bank intends to engage in a general commercial
banking business, emphasizing the banking needs of individuals and
small to medium-sized businesses in its primary service area.
See"USE OF PROCEEDS" and "BUSINESS OF THE COMPANY AND THE BANK."
The philosophy of the management of the Bank with respect to its
initial operations will be to emphasize prompt and responsive
personal service to the residents of Jackson, Georgia and the other
communities located in Butts County in order to attract customers
and acquire market share now controlled by other financial
institutions in the Bank's market area. The organizers believe
that the Bank offers the residents of Jackson and the surrounding
areas the opportunity to have an ownership interest in a community
bank, while also receiving the benefits associated with a locally
owned and managed community bank. Although other community banks
are located in the Jackson area, the Bank will be unique in that
ownership of the Company's stock will be available to residents in
the community, Through ownership in the Company, the residents of
the community will have a greater role in the development of the
Bank.
The offices of the Bank will be located at 150 Covington Street,
Jackson, Georgia 30233. The Bank's current principal executive
office is located as follows: 150 Covington Street, Jackson,
Georgia 30233 and its telephone number at that address is (770)
504-1090.
The Offering
Security Common Stock, $5.00 par value, of the Company
Offering Price $10.00 per share
Number of Shares Minimum: 610,000
Offered Maximum: 800,000
Use of Proceeds To purchase 100% of the Common Stock of the
Bank; the remaining proceeds will be applied to
working capital and used to pay organizational
expenses of the Company and of this offering.
The Bank will use the proceeds of this offering
to pay organizational and pre-opening expenses;
to purchase a site and furnish it for the
Bank's main office; to provide working capital
to be used for business purposes, including
paying officers' and employees' salaries,
making loans and other investments. See "USE
OF PROCEEDS."
Risk Factors
Investment in the Common Stock involves a significant degree of
risk. See "RISK FACTORS."
RISK FACTORS
Investment in the shares of the Common Stock offered hereby
involves a significant degree of risk. The shares of Common Stock
should be purchased by investors who can afford the loss of their
entire investment. In addition to considering factors set forth
elsewhere in this Prospectus, persons interested in purchasing
shares of the Common Stock should carefully consider the following
risks before making a decision to subscribe.
THE SHARES OF COMMON STOCK OFFERED HEREBY ARE NOT SAVINGS
ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF A BANK OR SAVINGS
ASSOCIATION AND ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
Regulatory Approvals Required
The Company must receive the approval of the Federal Reserve and
the Department of Banking before it can become the holding company
of the Bank. Applications for such approvals have been filed with
such agencies and are pending. The organizers anticipate receiving
such approvals during January, 1997. Such approvals will require
the Company to sell at least 610,000 shares of its Common Stock but
are not expected to contain other conditions.
The Bank's application to organize a new state bank and for
federal deposit insurance was filed with the Department of Banking
and the FDIC on June 28, 1996. The Department of Banking and the
FDIC issued their approvals on October 11, 1996 and September 30,
1996, respectively. Both approvals are subject to the condition
that at least $6,000,000 be invested in the Bank by the Company, as
well as a number of other standard conditions which are regularly
imposed by the Department of Banking and the FDIC which are
generally designed to familiarize the Bank with certain applicable
operating requirements (e.g., no directors' fees are payable until
the Bank earns a cumulative profit) and to prepare the Bank to
commence business operations (e.g., the adoption of loan,
investment and other policies to govern the Bank's operations).
New Enterprise
The Bank, which will be the sole subsidiary of the Company, is
in organization and has no operating history on which to base any
estimate of its future prospects. The Company's initial
profitability will depend entirely upon the Bank's operations. The
Bank's proposed operations are subject to risks inherent in the
establishment of a new business and, specifically, of a new bank.
While the Bank's pro forma financial statements project a profit by
the end of the second year of operations, unforeseen circumstances
could delay such profit. If the Bank is ultimately unsuccessful,
there is no assurance that shareholders will recover all or any
part of their investment in the Common Stock of the Company.
Competitive Industry
The banking business is highly competitive. The Bank will
compete as a financial intermediary with other commercial banks,
savings and loan associations, credit unions, finance companies,
mutual funds, insurance companies, and brokerage and investment
banking firms soliciting business from residents of Butts County,
Georgia, many of which have greater resources than will be
available to the Bank or the Company. There is no assurance that
the Bank will achieve the market share necessary to become
profitable in the near future. See "BUSINESS OF THE COMPANY AND
THE BANK - The Bank - Competition and Historical Deposit Trends."
Highly Regulated Industry
The potential success or failure of the Bank will depend not
only upon competitive factors, but also upon state and federal
regulations affecting banks and bank holding companies generally.
Regulations now affecting the Company and the Bank may be changed
at any time, and there is no assurance that such changes will not
adversely affect the business of the Company and the Bank. See
"SUPERVISION AND REGULATION."
<PAGE>
Effect of Monetary Policies
The results of operations of the Bank will be affected by credit
policies of monetary authorities, particularly the Board of
Governors of the Federal Reserve System. There can be no assurance
that the effect of actions by monetary and fiscal authorities,
including the Federal Reserve, will not have an adverse effect on
the deposit levels, loan demand or the business and earnings of the
Bank. See "SUPERVISION AND REGULATION - Monetary Policies."
Success Depends on Economic Conditions
The success of the Bank will depend largely on the general
economic conditions in the Bank's primary service area of Butts
County, Georgia. Although the Bank expects favorable economic
development in this market area, there is no assurance that
favorable economic development will occur or that the Bank's
expectation of corresponding growth will be achieved. See
"BUSINESS OF THE COMPANY AND THE BANK."
Offering Price Arbitrarily Determined
Since the Company and the Bank are in the process of being
organized, the offering price of $10.00 per share has been
determined arbitrarily by the organizers without particular
reference to historical or projected earnings, book value or other
customary criteria. The organizers did not retain an independent
investment banking firm to assist in determining the offering
price. Should a market develop for the Common Stock of the
Company, there is no assurance that any of the Common Stock offered
hereby could be resold for the offering price or any other amount.
No Dividends
Since the Company and the Bank are both start-up operations, it
will be the policy of the Board of Directors of the Company to
reinvest earnings for the period of time necessary to help ensure
the success of their operations. As a result, the Company has no
current plans to initiate the payment of cash dividends, and its
future dividend policy will depend on the Bank's earnings, capital
requirements, financial condition and other factors considered
relevant by the Board of Directors of the Company. See
"SUPERVISION AND REGULATION - Bank Regulation."
<PAGE>
No Established Trading Market
There is no public trading market for the shares of the Common
Stock of the Company, and it is not anticipated that a market for
the shares will develop as a result of this offering. As a result,
investors who may wish or need to dispose of all or a part of their
investment in the Common Stock may not be able to do so except by
private direct negotiations with third parties assuming that third
parties are willing to purchase the Common Stock.
Dilution
Investors purchasing shares of Common Stock in this offering may
incur possible dilution of their interest in the Company to the
extent that the organizers exercise the outstanding options to
purchase common stock at a price below the market value of such
stock. See "MANAGEMENT - Stock Options of Organizers."
Outstanding Options
The Company has issued to the organizers (except John L.
Coleman) performance stock options to purchase an aggregate of
150,000 shares of Common Stock at an exercise price of the greater
of $10.00 per share or the book value of the stock as of the end of
the month immediately preceding the date of exercise. Each
organizer has a performance option for 15,000 shares. The term of
the options is ten years from the date of completion of the
offering. The exercise of the options is conditional on the Bank
achieving a cumulative profit and obtaining a CAMEL 2 rating. The
options are also not effective until approved by the applicable
banking regulatory authorities. Holders of such options are likely
to exercise them when, in all likelihood, the value of the
Company's Common Stock substantially exceeds the exercise price
under the options. In addition, the exercise of such options will
result in dilution to the interests of the stockholders of the
Company to the extent that the exercise price is less than the fair
market value of the common stock. See "MANAGEMENT-Stock Options of
Organizers." John L. Coleman, President and C.E.O. of the Company,
has also been issued certain stock options. See "MANAGEMENT - Cash
Compensation."
THE OFFERING
Terms of the Offering
Minimum/Maximum. The Company is offering a minimum of 610,000
shares and a maximum of 800,000 shares of its Common Stock for a
price of $10.00 per share, for an aggregate minimum price of
$6,100,000 and an aggregate maximum price of $8,000,000. The
minimum purchase for any investor (together with the investor's
affiliates) is 100 shares of Common Stock ($1,000) unless the
Company, in its sole discretion, accepts a subscription for a
lesser number of shares. The maximum purchase for any investor
(together with the investor's affiliates) is 27,700 shares
($277,000) of Common Stock, unless the Company, in its sole
discretion, accepts a subscription for a greater number of shares.
27,700 shares represents 4.51% of the minimum and 3.46% of the
maximum number of shares to be sold.
Organizer Subscriptions. The organizers (the directors) of the
Company intend to purchase an aggregate of 165,000 shares of Common
Stock sold in the offering (27% of the minimum and 20.6% of the
maximum number of shares to be sold). No organizer intends to
individually purchase more than 5% of shares sold in this offering.
In the event, however, that the minimum number of shares in this
offering are not sold, the organizers may acquire additional shares
of the Common Stock, up to a maximum aggregate number for all
organizers of 304,700 shares (49.95% of the minimum and 38.1% of
the maximum number of shares to be sold).
Offering Period and Expiration Date. The offering period for
the shares will terminate at the earlier of the date all shares
offered hereby are sold or 5:00 p.m. Jackson, Georgia time, on
____________________, 1996. [60 days from beginning of sale of
securities] This date may be extended at the discretion of the
Company for additional periods not exceeding an aggregate of 180
days (i.e., until ______________________, 1997). Written notice of
any such extension will be given to all persons who are already
subscribers at the time of the extension. The date on which this
offering terminates plus any extension thereof is referred to in
this Prospectus as the "Expiration Date."
Subscription. As indicated below under "How to Subscribe," upon
execution and delivery of a subscription agreement for shares of
the Common Stock, subscribers will be required to deliver to the
Company a check in the amount of $10.00 times the number of shares
subscribed. All subscriptions will be binding and irrevocable
until the Expiration Date.
Escrow. Subscription proceeds will be deposited in an escrow
account with The Bankers Bank, Atlanta, Georgia, as escrow agent
(the "Escrow Agent") for the Company pending completion of this
offering. Subscription proceeds held in the escrow account will be
invested in short-term United States Government securities or
interest bearing accounts insured by the FDIC or in such other
short-term investments as may be agreed upon by the Company and the
Escrow Agent from time to time. The Escrow Agent has not
investigated the desirability or advisability of an investment in
the Company, and has not approved, endorsed or passed upon the
merits of the Common Stock.
Company Discretion. The Company reserves the right, in its sole
discretion, to accept or reject any subscription in whole or in
part on or before the Expiration Date. Without limiting the
generality of the foregoing, the Company also reserves the right to
accept subscriptions on a prorated basis if it receives
subscriptions for more than 800,000 shares. The Company will
notify all subscribers no later than five business days after the
Expiration Date whether their subscriptions have been accepted.
With respect to any subscriptions which are not accepted, in whole
or in part, by the Company, the notification will be a accompanied
by the unaccepted portion of the subscription funds, with interest
payable at a rate equal to the rate Wachovia Bank, Atlanta,
Georgia, pays its passbook savings account holders (___% at
_______________, 1996).
Termination. The Company reserves the right to terminate the
offering at any time after 610,000 shares have been subscribed for
if the Company determines that the total amount of subscriptions
will provide adequate capitalization for the Company after payment
of expenses.
Release from Escrow. Subscription proceeds will be released
from escrow to the Company upon the occurrence of all of the
following events: (a) the sale by the Company of at least 610,000
shares of its Common Stock, (b) receipt by the Company of approval
of the Federal Reserve and the Department of Banking to become a
bank holding company, (c) satisfaction by the Company of, or a
determination by the Company that it will satisfy, all of the
conditions that the Federal Reserve and the Department of Banking
may impose in their approvals to the Company, (d) receipt by the
Bank of approval from the Department of Banking and the FDIC of the
Bank's application to organize a new state bank and for deposit
insurance, and (e) satisfaction by the Bank of, or a determination
by the Bank that it will satisfy, all of the conditions that the
FDIC and the Department of Banking have imposed in their approvals
to the Bank.
If the above conditions are met, the Company may instruct the
Escrow Agent to release to the Company the amount of subscription
proceeds relating to subscriptions or portions thereof accepted by
the Company, together with any interest earned thereon. Any
subscription proceeds received after the above conditions are met
but before termination of this offering will not be deposited in
the escrow account, but will be available for immediate use by the
Company, to the extent accepted by the Company.
In addition, if the Escrow Agent receives not less than
$1,650,000 from the organizers (representing subscriptions to
purchase 165,000 shares of Common Stock in the offering) on or
before the Expiration Date, such funds and any profits thereon will
be released to the Company. The release of such funds will enable
the Company to advance monies for organizational expenses of the
Bank, including the construction of the banking facilities of the
Bank, in advance of attainment of subscriptions for the minimum
number of shares offered hereby (610,000 shares). No other
subscription proceeds will be released from escrow until the
conditions for release of subscription proceeds set forth above are
fulfilled. The shares issued to organizers in return for their
subscription funds shall be credited toward the minimum number of
shares required to be subscribed for to release subscription
proceeds from escrow.
The Bank received approvals from the Department of Banking and
the FDIC on October 11, 1996 and September 30, 1996. The Company
expects to receive approvals from the Federal Reserve and the
Department of Banking during January, 1997. In the opinion of the
organizers, the only significant condition to all of the foregoing
approvals will be that a minimum of 610,000 shares of Common Stock
of the Company has to be sold in this offering. If the requisite
shares are not sold, or if the Company or the Bank determine that
they cannot satisfy the other conditions included in the approvals
by the Expiration Date, then the subscription agreements will be of
no further force or effect, and the full amount of all subscription
funds of the subscribers (other than organizers), with interest
payable at a rate comparable to the rate Wachovia Bank, Atlanta,
Georgia, pays its passbook savings account holders, will be
returned to the subscribers (other than organizers) within five
business days of the Expiration Date.
It is possible that subsequent to the release of the
subscription funds from escrow (the requisite shares having been
sold and the determination having been made the other regulatory
conditions will be satisfied) events could occur which could have
the effect of preventing the Bank from commencing business. If
that were to occur, the Company intends to liquidate and would
return to the then shareholders of the Company the portion of their
investment which is equal to their total investment less their
prorata share of the expenses incurred by the Company and the Bank.
See "USE OF PROCEEDS" and "CAPITALIZATION." While no assurance can
be given that the foregoing will not take place, the organizers
cannot foresee any such events and believe it is highly unlikely
that such events will occur. After consulting with applicable
regulatory authorities, the organizers are not aware of any Georgia
state banks which failed to commence business after they or their
holding companies had raised the required capital. Additionally,
based on conversations with applicable regulatory authorities,
there are no indications that the Company and the Bank will have
any difficulty in satisfying the applicable regulatory conditions.
Plan of Distribution. Offers and sales of the Common Stock will
be made on behalf of the Company primarily by certain of its
officers and directors. The officers and directors will receive no
commissions or other remuneration in connection with such
activities, but they will be reimbursed for their reasonable
expenses incurred in the offering. In reliance on Rule 3a4-1 of
the Exchange Act, the Company believes such officers and directors
will not be deemed to be brokers and/or dealers under the Exchange
Act.
The Company has no present arrangements or agreements with any
brokers and/or dealers with respect to this offering. The Company
presently anticipates that no sales of Common Stock will require
the use of brokers and/or dealers. In the unlikely event that
broker/dealers are used, all such funds will be promptly
transmitted to the Escrow Agent under the terms of the escrow
agreement.
It is expected that the organizers (the directors of the
Company) will purchase a total of 165,000 of the shares of Common
Stock offered hereby; however, the organizers may, subject to
regulatory approval, purchase up to 49.9% of the minimum number of
shares offered hereby if necessary to complete the offering. Any
shares purchased by the organizers in excess of their original
commitment will be purchased for investment and not with a view to
the resale of such shares, and any such purchases will be subject
to regulatory approval.
Founders Club. Each investor shall be deemed to be a member of
the "Founders Club" of the Bank, which will entitle the investor to
a personal checking account with no service charge for as long as
the investor owns a minimum of 100 shares of Company Common Stock.
The initial order of checks for such account will be complimentary,
and the check design will identify the account holder as a member
of the Founders Club.
How to Subscribe
Each prospective investor who (together with the investor's
affiliates) desires to purchase 100 or more shares must:
1. Complete, date and execute the Subscription Agreement,
which is attached as Exhibit A to this Prospectus.
2. Make a check payable to "The Bankers Bank - Escrow
Account for First Georgia Community Corp." in an amount
equal to the full subscription price of $10.00 times the
number of shares subscribed for.
3. Return the completed Subscription Agreement and check as
follows:
HAND OR MAIL DELIVERY
First Georgia Community Corp.
150 Covington Street
P. O. Box 1534
Jackson, Georgia 30233
Attn: John L. Coleman
USE OF PROCEEDS
The net proceeds from the sale of the shares offered hereby
after deducting estimated offering expenses of $35,000 will be
between $6,065,000 if the minimum of 610,000 shares are sold and
$7,965,000 if the maximum of 800,000 shares are sold. Offering
expenses will be paid by the Company through direct advances by the
organizers and draws on the organization loan made to the
organizers, and the advances and the organization loan will be
repaid from the gross proceeds of this offering.
The organizers also expect the Company and the Bank to incur
approximately $50,000 of organizational expenses and pre-opening
expenses of approximately $286,000 (assuming the minimum offering
is completed on January 31, 1997 and the Bank begins operation on
July 31, 1997), which would be offset in part by estimated pre-opening
investment income on offering proceeds of approximately
$94,000. Offering, organizational and pre-opening expenses
incurred prior to the conclusion of the offering will be paid
through draws by the Company on the organization loan (which has
been taken out by the organizers), and by direct advances from the
organizers. To the extent such amounts and accrued interest
thereon exceeds $555,000, additional offering, organizational and
pre-opening expenses will be paid through draws on any additional
line of credit established for the Company and/or advances by the
organizers, with all of such amounts to be repaid by the Company
together with accrued interest from net offering proceeds.
The Company will use a portion of the net offering proceeds to
repay loans by the organizers to the Company and advances under the
line of credit, which monies were and will be used to pay
organizational, pre-opening, and offering expenses for the Company
and the Bank. In addition, the Bank will use a portion of the
proceeds it receives from the sale of its stock to the Company to
reimburse the Company for amounts advanced by the Company to pay
organizational and pre-opening expenses of the Bank.
Prior to this offering, ten of the organizers (all of the
directors of the Company, except Mr. Coleman) and one business
associate of the organizers each made a personal loan of $5,000 to
the Company for an aggregate of $55,000 to pay a portion of the
expenses associated with organizing the Company and preparing this
Prospectus. This loan bears no interest. The principal of the
loan will be repaid from the proceeds of this offering as stated
above.
The Company will capitalize the Bank with a minimum of
$6,000,000 and up to $7,700,000 of the net offering proceeds by
purchasing between 600,000 and 770,000 shares of the Bank's stock
at a price of $10.00 per share. After the anticipated expenditure
of approximately $1,675,000 in the aggregate, the Bank will have
remaining working capital of between approximately $4,325,000 and
$6,025,000 to be used for the purposes of making loans and
investments in the course of the Bank's operations and to pay
operating expenses (to the extent such expenses are not met by
operating income).
The remaining balance of the net proceeds of the offering of
between approximately $50,000 and $250,000 (depending on the number
of shares sold) will be retained to establish the Company's working
capital and for general corporate purposes, including supporting
the Bank's growth and engaging in other permitted activities.
The following table set forth in tabular form the estimated use
by the Company and the Bank of the gross proceeds of the minimum
and maximum offerings based on the estimate of management at this
time and assuming that the offering is concluded as of January 31,
1997 and that the Bank commences operations on July 31, 1997, for
purposes of projecting offering, organizational and pre-opening
expenses and for computing interest payable. Pre-opening expenses
will increase, with a corresponding reduction in working capital
available to the Company and Bank, in the event completing the
offering is delayed for any reason. Management believes that the
Bank will commence operations by July 31, 1997 since all regulatory
approvals should be received several months before that date as set
forth herein and based on discussions with building contractors,
management believes the proposed bank building will be built in
under five months and construction will begin prior to the end of
January, 1997.
Use of Proceeds
<TABLE>
<S> <C> <C>
Minimum Maximum
Gross Proceeds From This Offering(1) $6,100,000 $8,000,000
Anticipated Use of Proceeds by the Company:
Offering Expenses 35,000 35,000
Organizational Expenses(2) 15,000 15,000
Working Capital 50,000 250,000
Capitalization of Bank through Purchase
of Common Stock of the Bank 6,000,000 7,700,000
Total $6,100,000 $8,000,000
Anticipated Use of Capital by the Bank:
Organizational Expenses(2) $ 35,000 $ 35,000
Pre-opening Operating Expenses(2)(4) 192,000 192,000
Land and Bank Premises(3) 1,205,000 1,205,000
Furniture, Fixtures & Equipment 243,000 243,000
Working Capital 4,325,000 6,025,000
Total $6,000,000 $7,700,000
_______________________
</TABLE>
(1) Assuming sale of 610,000 shares and 800,000 shares,
respectively, at $10.00 per share.
(2) Organizational expenses consist primarily of consulting fees for
market analysis and feasibility studies, filing fees,
accounting, appraisal and legal fees and expenses. Pre-opening
operating expenses consist primarily of salaries and benefits,
printing, promotion, supplies and interest expense. Such
expenses have been estimated through July 31, 1997. All of such
expenses as well as those for premises and leasehold
improvements, and for furniture, fixtures and equipment are
expected to be incurred provided that the offering proceeds are
released from escrow.
(3) In order to facilitate organization of the Company and the Bank,
the organizers may determine to accelerate expenditures for
temporary office renovations, main office construction or
otherwise in anticipation of completing the minimum offering,
which could require that they advance additional funds or
guarantee additional Company debt to be repaid from offering
proceeds.
(4) Assuming $286,000 of gross expenses, net of anticipated
preopening income of $94,000.
CAPITALIZATION
The following table sets forth the capitalization of the Company
as of August 31, 1996 and as adjusted to give pro forma effect to
the sale by the Company of the minimum offering of 610,000 shares
and the maximum offering of 800,000 shares (as of the completion of
the offering) and the receipt of the net proceeds anticipated by
the Company from such sale, which will result in initial compliance
with all regulatory capital requirements. All offering proceeds,
with interest, will be returned to subscribers in the event the
minimum offering is not completed.
<TABLE>
PRESENTLY AS OF COMPLETION
OUTSTANDING1 OF THE OFFERING2
<C> <C> <C> <C> <C>
SHARES AMOUNT SHARES AMOUNT
ASSUME MINIMUM OFFERING:
Advances from organizers --- $106,000 --- $ 0
Common Stock, $5 par value
10,000,000 shares authorized;
one share issued, 610,000 to be
issued as adjusted 1 5 610,000 3,050,000
Capital surplus 5 3,015,000
Accumulated deficit (24,883) (24,883)
Total equity $ (24,873) 6,040,117
ASSUME MAXIMUM OFFERING:
Advances from organizers --- $106,000 --- 0
Common stock, $5 par value;
10,000,000 shares authorized;
one shares issued, 800,000
to be issued as adjusted 1 5 800,000 4,000,000
Capital surplus 5 3,965,000
Accumulated deficit (24,883) (24,883)
Total equity $ (24,873) 7,940,117
</TABLE>
___________________________________
1In August, 1996, the Company issued one share of Common Stock to Mr.
Coleman for $10 in connection with the organization of the Company.
2Expenses related to this offering are estimated to be $35,000 and
will be charged to the capital surplus upon completion of the offering.
<PAGE>
DIVIDENDS
Since the Company and the Bank are both start-up operations, it
will be the policy of the Board of Directors of the Company to
reinvest earnings for the period of time necessary to help ensure
the success of their operations. As a result, the Company has no
current plans to initiate the payment of cash dividends, and its
future dividend policy will depend on the Bank's earnings, capital
requirements, financial condition and other factors considered
relevant by the Board of Directors of the Company. See
"SUPERVISION AND REGULATION - Bank Regulation."
BUSINESS OF THE COMPANY
AND THE BANK
The Company
The Company was incorporated as a Georgia business corporation
on August 7, 1996 to become a bank holding company by acquiring all
the common stock of the Bank upon its formation. Initially, the
Bank will be the sole operating subsidiary of the Company. The
Company will apply to the Federal Reserve and the Department of
Banking for prior approval to use a minimum of $6,000,000 of the
proceeds of this offering to acquire the Bank. If such approvals
are granted, upon its acquisition of the common stock of the Bank,
the Company will become a bank holding company within the meaning
of the Bank Holding Company Act of 1956, as amended, and the
Georgia Bank Holding Company Act. See "SUPERVISION AND
REGULATION."
The Company has been organized to facilitate the Bank's ability
to serve its future customers' requirements for financial services.
The holding company structure will provide flexibility for
expansion of the Company's banking business through the possible
acquisition of other financial institutions and the provision of
additional banking-related services which the traditional
commercial bank may not provide under present laws. For example,
banking regulations require that the Bank maintain a minimum ratio
of capital to assets. In event that the Bank's growth is such that
this minimum ratio is not maintained, the Company may borrow funds,
subject to capital adequacy guidelines of the Federal Reserve, and
contribute them to the capital of the Bank and otherwise raise
capital in a manner which is unavailable to the Bank under existing
banking regulations.
The Company has no present plans to acquire any operating
subsidiaries other than the Bank. It is expected, however, that
the Company may make additional acquisitions in the future in the
event that the Company becomes profitable and such acquisitions are
deemed to be in the best interest of the Company and its
shareholders. Such acquisitions, if any, will be subject to
certain regulatory approvals and requirements. See "SUPERVISION
AND REGULATION."
The Bank
General. The organizers filed an application with the Department
of Banking and with the FDIC on June 28, 1996, for authority to
organize as a state bank and trust company, the deposits of which
will be federally insured, and to conduct a commercial banking
business from Jackson, Georgia. The organizers received approvals
from the Department of Banking on October 11, 1996 and the FDIC on
September 30, 1996.
The Bank intends to be a full service commercial bank. The Bank
plans to offer personal and business checking accounts, interest-bearing
checking accounts, savings accounts, money market funds and
various types of certificates of deposit. The Bank also plans to
offer installment loans, real estate loans, second mortgage loans,
commercial loans and home equity lines of credit. In addition, the
Bank intends to provide such services as official bank checks and
money orders, Mastercard and Visa credit cards, safe deposit box,
traveler's checks, bank by mail, direct deposit of payroll and
social security checks, and US Savings Bonds.
Philosophy. The philosophy of the management of the Bank with
respect to its initial operations will be to emphasize prompt and
responsive personal service to the residents of Jackson, Georgia
and the other communities located in Butts County in order to
attract customers and acquire market share now controlled by other
financial institutions in the Bank's market area. The organizers
believe that the Bank offers the residents of Jackson and the
surrounding areas the opportunity to have an ownership interest in
a community bank, while also receiving the benefits associated with
a locally owned and managed community bank. Although one other
community bank is located in Butts County, the Bank will be unique
in that ownership of the Company's stock will be available to
residents in the community. Through ownership in the Company, the
residents of the community will have a greater role in the
development of the Bank.
Management of the Bank intends to implement an active officer and
director call program to promote these efforts. The purpose of
this call program will be to describe the products, services and
philosophy of the Bank to both existing and new business prospects.
In addition, the President of the Bank has substantial banking
experience in Butts County, which will be an asset in providing
both products and services designed to meet the needs of the Bank's
customer base. All of the organizers are active members of the
business community in Jackson and the areas located around Butts
County, and their continued active community involvement will
provide an opportunity to promote the Bank and its products and
services. The organizers intend to utilize effective advertising
and superior selling efforts in order to build a distinct
institutional image for the Bank and to capture a customer base.
Bank Location and Facilities. The Bank will be located at 150
Covington Street in Jackson, Georgia in Butts County. The Bank
plans to provide services to Butts County residents, as well as to
residents from the adjacent counties of Spalding and Henry.
On May 1, 1996, one of the organizers (William B. Jones) entered
into a Contract for Sale of Realty with The Roman Catholic
Archdiocese of Atlanta (the "First Agreement") to purchase 1.721
acres of improved property located at 150 Covington Street,
Jackson, Georgia, for a purchase price of $250,000. Mr. Jones has
assigned his rights and interest in said contract to the Company.
Under said Contract, as amended, the Company is required to close
the purchase of the property on or before January 13, 1997. The
entire purchase price is payable at closing. The Company
anticipates closing the purchase by January 13, 1997, using funds
to be borrowed under the line of credit of the organizer with
SouthTrust Bank. The improvements on the property will be removed,
and a bank building will be constructed on the property.
On May 29, 1996, Mr. Jones entered into a Real Estate Sales
Contract with the Estate of Henry Adolphus Lassiter (the "Second
Agreement") to purchase .65 acres adjoining the Archdiocese
property for a purchase price of $145,000. Mr. Jones has assigned
his rights and interest in said contract to the Company. Under
said contract, as amended, the Company is required to close the
purchase of the property on or before January 31, 1997. The entire
purchase price is payable at closing. The Company anticipates
closing the purchase by January 31, 1997, using funds to be
borrowed under the line of credit of the organizers with SouthTrust
Bank.
The organizers of the Bank obtained an appraisal of the property
(both tracts together), the size of which is approximately 2.5
acres. The appraisal, dated August 12, 1996, appraised the
property at $405,000. A copy of the appraisal of the property was
filed with the Bank's application to the Department of Banking and
the FDIC.
The organizers plan to have a 9,085 square foot, two-story
building constructed on the property. There will be five teller
stations inside and four drive-through stations.
Primary Service Area. The Bank's Primary Service Area ("PSA")
is defined as a 5-mile radius from the Bank location. The Bank has
defined its local community as Jackson and Butts County, Georgia
and portions of the surrounding counties of Spalding and Henry.
Economic and Demographic Factors. According to the 1995 Georgia
County Guide, Butts County has grown during each census since 1960.
From 1980 to 1990, Butts County grew by 12.2%. The adjacent
counties of Spalding and Henry Counties have also experienced
positive population growth. The projected populations of Butts
County, Henry County and Spalding County in 2000 are 16,763,
84,810, and 58,432, respectively. According to Georgia Economic
Profile, 26% of the employment base of the six counties of Butts,
Henry, Spalding, Newton, Jasper and Monroe are employed in
manufacturing. Apart from that concentration, there appears to be
a wide range of different activities in the employment base.
Competition and Historical Deposit Trends. Butts County has two
commercial banks with a total of three offices. McIntosh State
Bank is located in Jackson, with a main office and one branch,
which is located in a grocery store. NationsBank of Georgia, N.A.,
has a branch in Jackson. NationsBank of Georgia is a subsidiary of
a large multi-state bank holding company currently operating in
nine states and headquartered in Charlotte, North Carolina.
Deposits among the banks in Butts County have grown from 1989 to
1994. In Butts County, deposits have grown by 19% over that period
of time. The organizers believe that this indicates a growing
demand for bank services within the county. Projections prepared
for the Bank and submitted to the Department of Banking indicate
that the Bank could grow to $19,900,000 in deposits by 1998. There
is no assurance, however, that the Bank's projections will be
realized.
The organizers believe that a locally owned bank where decisions
are made within Butts County will be more cognizant of the
community's needs and more responsive in meeting those needs and
local expectations. The Bank will operate from a modern facility
offering convenient hours and competitive services delivered in a
friendly manner. In addition, management believes that having a
local board of directors and wide community ownership of the
Company's Common Stock will enable the Bank to be successful.
Lending Policy. The Bank is being established to support Butts
County and the immediately-surrounding counties of Spalding and
Henry. Consequently, the Bank will aggressively seek good loans
within a limited geographic area. The Bank's primary commercial
lending function will be to make consumer loans to individuals and
commercial loans to small and medium-sized businesses and
professional concerns. In addition, the bank plans to make real-estate-
related loans, including construction loans for residential
and commercial properties, and primary and secondary mortgage loans
for the acquisition or improvement of personal residences. The
Bank plans to avoid concentrations of loans to a single industry or
based on a single type of collateral.
Real Estate Loans. The Bank will make and hold real estate
loans, consisting primarily of single-family residential
construction loans for one-to-four unit family structures. The
Bank will require a first lien position on the land associated with
the construction project and will offer these loans to professional
building contractors and homeowners. Loan disbursements will
require on-site inspections to assure the project is on budget and
that the loan proceeds are being used for the construction project
and not being diverted to another project. The loan-to-value ratio
for such loans will be predominantly 75% of the lower of the as-built
appraised value or project cost, and will be a maximum of 80%
if the loan is amortized. Loans for construction can present a
high degree of risk to the lender, depending upon, among other
things, whether the builder can sell the home to a buyer, whether
the buyer can obtain permanent financing, whether the transaction
produces income in the interim and the nature of changing economic
conditions.
Consumer Loans. The Bank plans to make consumer loans,
consisting primarily of installment loans to individuals for
personal, family and household purposes, including loans for
automobiles, home improvements and investments. Risks associated
with consumer loans include, but are not limited to, fraud,
deteriorated or non-existing collateral, general economic downturn
and customer financial problems.
Commercial Loans. Commercial lending will be directed
principally toward small to mid-size businesses whose demand for
funds fall within the legal lending limits of the Bank. This
category of loans includes loans made to individual, partnership or
corporate borrowers, and obtained for a variety of business
purposes. Risks associated with these loans can be significant and
include, but are not limited to, fraud, bankruptcy, economic
downturn, deteriorated or non-existing collateral and changes in
interest rates.
Investments. In addition to loans, the Bank will make other
investments primarily in obligations of the United States or
obligations guaranteed as to principal and interest by the United
States and other taxable securities. No investment in any of those
instruments will exceed any applicable limitation imposed by law or
regulation.
Deposits. The Bank plans to establish solid core deposits,
including checking accounts, money market accounts, a variety of
certificates of deposit, and IRA accounts. The primary means used
to attract deposits will be an aggressive marketing plan in the
overall service area, a broad product line, and competitive
services. The primary sources of deposits will be residents of,
and businesses and their employees located in, Butts County, and to
a lesser extent, Spalding County and Henry County, obtained through
personal solicitation by the Bank's officers and directors, direct
mail solicitations and advertisements published in the local media.
Deposits will be generated by offering a broad array of
competitively priced deposit services, including demand deposits,
regular savings accounts, money market deposits (transaction and
investment), certificates of deposit, retirement accounts, and
other deposit or funds transfer services which may be permitted by
law or regulation and which may be offered to remain competitive in
the market.
Asset and Liability Management. The Bank intends to manage its
assets and liabilities to provide an optimum and stable net
interest margin, a profitable after-tax return on assets and return
on equity, and adequate liquidity. These management functions will
be conducted within the framework of written loan and investment
policies which the Bank will adopt. The Bank will attempt to
maintain a balanced position between rate sensitive assets and rate
sensitive liabilities. Specifically, it will chart assets and
liabilities on a matrix by maturity, effective duration, and
interest adjustment period, and endeavor to manage any gaps in
maturity ranges.
Employees. Upon commencement of operations, the Bank is expected
to have approximately 13 full-time employees. The Company is not
expected to have any employees who are not also employees of the
Bank.
<PAGE>
MANAGEMENT
Proposed Officers and Directors
On August 8, 1996, the Board of Directors of the Company elected
the following persons as officers of the Company:
John L. Coleman President, Chief Executive Officer
Alfred D. Fears, Jr. Secretary and Chief Accounting Officer
(until the Bank is chartered)
Harry Lewis Treasurer and Chief Financial Officer
(until the Bank is chartered)
The following table sets forth for the initial members of the
Board of Directors of the Company, (a) their names, addresses and
ages, (b) the positions they will hold in the Bank, (c) the number
of shares of Common Stock for which they intend to subscribe, and
(d) the percentage of outstanding shares such number will represent
if the minimum number of shares are sold in this offering and if
the maximum number of shares are sold in this offering. The
directors serve for a one year term, and the present term of office
of each director will expire at the annual shareholders meeting of
the Company to be held in April, 1998. These persons will also
serve as directors of the Bank.
<TABLE>
POSITION NUMBER % OF %OF
NAME AND ADDRESS (AGE) TO BE HELD OF SHARES* MINIMUM* MAXIMUM*
<S> <C> <C> <C> <C>
D. Richard Ballard (49) Director 15,000 2.46% 1.88%
1018 Stark Road
Jackson, GA 30233
Charles W. Carter (60) Director 15,000 2.46 1.88
853 W. 3rd Street
Jackson, GA 30233
John L. Coleman (51) Director/ 15,000 2.46 1.88
866-E Halls Bridge Road President
Jackson, GA 30233
Alfred D. Fears, Jr. (39) Director 15,000 2.46 1.88
448 Foxhollow Woods Drive
Jackson, GA 30233
William B. Jones (51) Director 15,000 2.46 1.88
642 Stark Road
Jackson, GA 30233
Harry Lewis (44) Director 15,000 2.46 1.88
549 Wesley Drive
Jackson, GA 30233
Joey McClelland (49) Director 15,000 2.46 1.88
2419 W. Highway 16
Jackson, GA 30233
Dr. Alexander Pollack (42) Director 15,000 2.46 1.88
140 Strickland Pasture Road
Jackson, GA 30233
Robert Ryan (58) Director 15,000 2.46 1.88
108 Old McIntosh Circle
Jackson, GA 30233
James H. Warren (58) Director 15,000 2.46 1.88
866-A Halls Bridge Road
Jackson, GA 30233
George L. Weaver (48) Director 15,000 2.46 1.88
2705 High Falls Road
Jackson, GA 30233
All Proposed Directors and 165,000 27.0% 20.6%
Officers, as a Group**
</TABLE>
____________________________
* In the event that the minimum number of shares in this offering
are not sold, the organizers may purchase additional shares
of Common Stock for an aggregate of 304,700 shares of Common
Stock (49.95% of the minimum and 38.1% of the maximum number of
shares to be sold).
** These figures are different from the sum of the individual
percentages because of rounding.
D. Richard Ballard was born in Barnesville, Georgia. Since 1967,
Mr. Ballard has been affiliated with Haisten Funeral home, Inc. in
Jackson, Georgia, and is currently the President/CEO. Mr. Ballard
is also the President/CEO of Haisten Funeral Home of Henry County,
Inc. Mr. Ballard is a member of the Jackson First Baptist Church,
Jackson Rotary Club, Butts County Chamber of Commerce, Henry County
Chamber of Commerce, Georgia and National Funeral Directors, and
National Selected Morticians.
Charles W. Carter was born in Henry County, Georgia. Since 1968,
Mr. Carter has been affiliated with Carter Builders Supply in
Jackson, and is currently the President. Mr. Carter was a director
of C & S Bank/NationsBank in Jackson from 1978 until 1994. He is
a member of Jackson Rotary Club, Sons of the American Revolution,
and the First Baptist Church of Jackson. He also serves on the
Butts County Water and Sewer Authority.
John L. Coleman was born in Miami, Florida. Since 1994, Mr.
Coleman has acted as Regional Retail Manager Northwest Georgia -Bartow
County/Senior Banking Executive for NationsBank Bartow
County in Cartersville, Georgia until July, 1996. From 1986 to
1994, Mr. Coleman was President/Senior Lender of C & S
Bank/NationsBank, Bartow County Division, in Cartersville, and
acted in a similar position at C & S Bank, Jackson Division, in
Jackson, Georgia, from 1982 to 1986. From 1967 to 1982, Mr.
Coleman worked in various management positions for C & S Bank in
LaGrange, Georgia, and Atlanta, Georgia. Mr. Coleman was a member
of Cartersville Rotary Club, Trinity Methodist Church, the
Salvation Army Board, the Cartersville Industrial Development
Authority, Cartersville Country Club, Cartersville Medical Center
Advisory Board, Cartersville Opera Company Board, and the Georgia
Economic Development Association. Mr. Coleman is relocating his
residence from Cartersville, Georgia to Jackson, Georgia to assume
the position of President of the Company and of the Bank.
Alfred D. Fears, Jr. was born in Griffin, Georgia. Mr. Fears has
been practicing law in Jackson, Georgia since 1981. He also owns
and operates an apartment rental business in Jackson. Mr. Fears is
a member of the State Bar of Georgia, Jackson Rotary Club, and the
Jackson United Methodist Church.
William B. Jones was born in Butts County, Georgia. From 1966 to
1976, Mr. Jones was a teacher/coach in Jackson, Georgia. Since
1977, Mr. Jones has practiced law in Jackson, Georgia, and has been
active in the food and petroleum distribution business. Mr. Jones
is currently President of Jones Petroleum Co., Meriwether
Properties, Inc. and Jones & Hudgins, and Vice President of Jones &
Owenby, Inc. Mr. Jones is a member of the State Bar of Georgia and
the Jackson Rotary Club. He also served on the Advisory Board of
NationsBank in Jackson. He is a Trustee of the Roosevelt Warm
Springs Foundation.
Harry Lewis was born in Atlanta, Georgia. Since 1983, Mr. Lewis
has owned and operated an automobile dealership in Jackson,
Georgia. He is also affiliated with Playtime Learning Center,
Inc., and is currently President. Mr. Lewis is a member of the
Jackson Rotary Club (past President), the Jackson Housing
Authority, Butts County Chamber of Commerce, Jackson Merchants
Association, Jackson Investment Club, Butts County Pre-Kindergarten
Coordinating Council, Georgia Automobile Dealers Association,
National Automobile Dealers Association and Georgia Child Care
Association.
Joey McClelland was born in Sarasota, Florida. Since 1989, Mr.
McClelland has acted as Executive Director of Marketing and
Logistics for Fritz Companies, International Business - Logistics
- -ATL. Prior to 1989, Mr. McClelland held numerous management level
positions in related marketing fields. Mr. McClelland is a member
of the Zoning Appeals Board, Council of Logistics Management, and
the Methodist Mens Club of Jackson United Methodist Church.
Dr. Alexander Pollack was born in New York, New York. Since 1986,
Dr. Pollack has been self-employed in Jackson, Georgia, as a
general surgeon. In addition, Dr. Pollack is Chairman of the Board
of Directors of Golden Health Care, Inc. Dr. Pollack is a member
of the Jackson Rotary Club.
Robert Ryan was born in Racine, Wisconsin. Since 1983, Mr. Ryan
has been President of Atlanta South 75 Inc. From 1960 to 1983, Mr.
Ryan held various management positions with Unocal Corporation, Los
Angeles, California. Mr. Ryan served on the Board of Directors of
Speedway Corporation and the Association of Christian Truckers. He
is a member of the American Legion, Rotary Club, and NATSO, and he
attends the Jackson Church of the Nazarene.
James H. Warren was born in Marvel, Alabama. Since 1971, Mr.
Warren has been self-employed as a general contractor and
developer. He is President of Sure Power, Inc., Secretary-Treasurer
of Brushy Mountain Hydro-Electric Power, Inc. and
Alternator & Starter House, Inc., and a partner in Fenwyck
Development Co. Mr. Warren is a member of the Auto Parts
Rebuilders Association.
George L. Weaver was born in Griffin, Georgia. Mr. Weaver has been
President of Central Georgia EMC since 1984. From 1971 to 1984,
Mr. Weaver held various management positions with Central Georgia
EMC. Mr. Weaver served on the Advisory Board of NationsBank of
Georgia, N.A. in Jackson, and as Vice Chairman of the Board of
Directors of Federated Rural Electric Insurance Corp. He presently
serves as a director of Oglethorpe Power Corporation, Southeastern
Data Corporation (past Chairman of the Board), Georgia Rural
Electric Service Corporation (past Chairman of the Board), and GEMC
Workers Compensation Fund. Mr. Weaver also serves as Vice
President and President-Elect of the Georgia Rural Electric
Managers Association and as a member of the Rural Electric
Management Development Council. Mr. Weaver is a member of the
Jackson Rotary Club and the Jackson United Methodist Church. Mr.
Weaver also serves as Chairman of the Butts County Industrial
Development Authority and as Vice Chairman of the West Central
Georgia Private Industry Council.
Cash Compensation
John L. Coleman has an employment agreement with the Company and
the Bank under which he will serve as President and Chief Executive
Officer of the Company and of the Bank. The employment agreement
provides for a five-year term and is annually renewable thereafter.
He will be paid an initial annual salary of $135,000. Once the
Bank begins operations he will also be entitled to certain
performance bonuses. To qualify for the annual bonus, the Bank
must first have a CAMEL 3 rating for the applicable year. If the
Bank has a CAMEL 3 rating for the applicable year, then Mr. Coleman
will be paid a cash bonus for the year which is a certain
percentage of his salary for the year depending on the pre-tax
return on average assets ("ROA") performance of the Bank for the
year. The CAMEL rating is a rating which will be assigned to the
Bank each year by the Department of Banking based on its
examination of different performance factors, with "1" being the
best CAMEL rating and "5" being the worst. The bonus formula is as
follows:
ROA Percentage of Salary
Less than .9% No bonus
.9% or greater; less than 1.0% 5%
1.0% or greater; less than 1.10% 10%
1.10% or greater; less than 1.20% 15%
1.20% or greater; less than 1.30% 20%
1.30% or greater; less than 1.40% 25%
1.40% or greater; less than 1.60% 30%
1.60% or greater; less than 1.75% 35%
1.75% or greater; less than 2.00% 40%
Over 2.00% 50%
Under Mr. Coleman's employment agreement, he also has the option
to purchase 15,000 shares of Common Stock of the Company at the
price of the lesser of $10.00 or book value of the stock during the
first three years of operation of the Bank and at the price of book
value of the stock during the remainder of the term of the
employment agreement, not to exceed a ten year option term. He
also will receive options to purchase up to an additional 5,000
shares at the price of book value of the stock at the date of
exercise, with the number of options which he may receive in any
year being determined based on a formula tied to performance of the
Bank. The number of options which Mr. Coleman will be entitled to
receive in any year is determined by multiplying (i) 1,000 shares
by (ii) a fraction whose numerator is the amount of the bonus
earned by Mr. Coleman determined as set forth above and whose
denominator is the maximum bonus which Mr. Coleman could have
received for the year. The term of these options is the same as
the term of the initial option to purchase 15,000 shares.
Mr. Coleman will also receive health, life and disability
insurance under the same plan and terms as other employees of the
Bank. He will receive a mid-size automobile to be used primarily
for business purposes, and the Bank will pay operating, maintenance
and insurance expenses for the automobile. The Bank will pay
monthly membership dues for Mr. Coleman up to $75.00 per month at
a local country club and the initiation fee of a local country club
up to $3,000.
Officers and directors of the Company will not be separately
compensated for their services to the Company until the Company
earns a cumulative profit.
Directors will not be compensated for their services as directors
until the Bank earns a cumulative profit.
Certain Transactions and Relationships
It is possible that the Company and the Bank will have banking
and other business transactions in the ordinary course of business
with directors and officers of the Company and the Bank, including
members of their families or corporations, partnerships or other
organizations in which such directors and officers have a
controlling interest. If such transactions occur, they will be on
substantially the same terms (including price, or interest rate and
collateral) as those prevailing at the time for comparable
transactions with unrelated parties, and any banking transactions
will not be expected to involve more than the normal risk of
collectibility or present other unfavorable features to the Company
and the Bank.
To facilitate the Bank's formation, ten of the organizers (all
of the directors of the Company, except Mr. Coleman) made a
personal loan of $5,000 to the Company. Additionally, the
organizers arranged a line of credit from SouthTrust Bank of
Columbus, N.A., Columbus, Georgia, in the aggregate amount of
$500,000 to pay organizational and pre-opening expenses for the
Company and the Bank. The line of credit bears interest at the
lender's prime rate (presently 8.25% per annum) and has a one-year
term. The organizers have personally taken out the line of credit.
The line of credit and interest costs will be repaid from the
offering proceeds when the conditions to the offering have been
satisfied. See "USE OF PROCEEDS."
William B. Jones has assigned to the Company his entire interest
in two real estate purchase agreements without any payment to him
by the Company, as discussed at "BUSINESS OF THE COMPANY AND THE
BANK -- Bank Location and Facilities."
The Board of Directors intends to consider adopting some form of
directors incentive stock option plan once the Bank has attained a
cumulative profit and a CAMEL 2 rating from the Department of
Banking. The adoption of any such plan shall be subject to
approval by the appropriate regulatory authorities.
Charles W. Carter and Harry Lewis are first cousins.
Stock Options of Organizers
The organizers of the Company (except Mr. Coleman) have each been
issued performance stock options to purchase 15,000 shares of
Common Stock of the Company at an exercise price of the greater of
$10.00 per share or the book value of the Common Stock as of the
end of the month immediately preceding the date of exercise. The term
of the options is ten years from the date of completion of the offering.
The stock options are non-transferable during an organizer's lifetime and
during his lifetime are exerciseble only by him. At an organizer's death,
his stock options may be transferred by his will or to his heirs-at-law.
The exercise of the performance stock options is subject to
the condition that the Bank have had a cumulative profit prior to
the date of exercise and that the Bank have at least a CAMEL 2
rating as of the date of exercise. The stock options shall not be
effective until approved by the appropriate banking regulatory
authorities. Management of the Company anticipates obtaining such
approval by the appropriate regulatory authorities. The exercise
of such options will result in dilution to the interests of the
stockholders of the Company to the extent that the exercise price
is less than the fair market value of the Common Stock.
Under current tax law, there are no federal income tax
consequences to either the organizer or the Company on the grant of
non-qualified options. Upon exercise of a non-qualified option,
the excess of the fair market value of the shares subject to the
option over the option price (the "spread") at the date of exercise
is taxable as ordinary income to the optionee in the year it is
exercised and is deductible by the Company as compensation for
federal income tax purposes. The optionee's basis in the shares
will be equal to the fair market value on the date taxation is
imposed and the holding period commences on such date.
For a discussion of the stock options granted to Mr. Coleman see
"MANAGEMENT - Cash Compensation" above.
MARKET FOR COMMON STOCK AND RELATED SHAREHOLDER MATTERS
There is currently no market for the shares of Common Stock and
it is not likely that an active trading market will develop for the
shares in the future. There are no present plans for the Company's
Common Stock to be traded on any stock exchange or over-the-counter
market. As a result, investors who need or wish to dispose of all
or part of their shares may be unable to do so except in private,
directly negotiated sales.
DESCRIPTION OF COMMON STOCK OF THE COMPANY
General
The Company's Articles of Incorporation authorize the Company to
issue up to 10,000,000 shares of Common Stock, par value $5.00 per
share, of which a minimum of 610,000 shares and a maximum of
800,000 shares will be issued pursuant to this offering.
All shares of Common Stock of the Company will be entitled to
share equally in dividends from funds legally available therefor,
when, as and if declared by the Board of Directors, and upon
liquidation or dissolution of the Company, whether voluntary or
involuntary, to share equally in all assets of the Company
available for distribution to the shareholders. It is not
anticipated that the Company will pay any cash dividends on the
Common Stock in the near future. See "DIVIDENDS." Each holder of
Common Stock will be entitled to one vote for each share on all
matters submitted to the shareholders. Holders of Common Stock
will not have any preemptive right to acquire authorized but
unissued capital stock of the Company. There is no cumulative
voting, redemption right, sinking fund provision, or right of
conversion in existence with respect to the Common Stock. All
shares of the Common Stock issued in accordance with the terms of
this offering as described in this Prospectus will be fully-paid
and non-assessable.
<PAGE>
Shares Held by Affiliates
Upon completion of this offering, the Company will have a minimum
of 610,000 shares and a maximum of 800,000 shares outstanding. All
of these shares will be freely tradeable without restriction or
registration under the Securities Act of 1933, as amended (the
"1933 Act"), except for shares purchased in this offering by the
organizers.
The organizers (the directors of the Company) are "affiliates"
of the Company (as that term is defined in Rule 144 adopted under
the 1933 Act), and, as a result, their shares will be subject to
certain resale restrictions.
Rule 144 generally provides that a person (including an affiliate
of the Company) who has beneficially owned shares for at least two
years would be entitled to sell within any three-month period a
number of shares that does not exceed the greater of 1% of the then
outstanding shares of the Common Stock or the average weekly
trading volume of the Common Stock during the four calendar weeks
preceding such sale, whichever is greater. While affiliates may
generally sell non-restricted shares under Rule 144 without regard
to the length of their holding period, all shares purchased by the
organizers will be purchased for investment purposes and not with
a present intention of redistribution.
There can be no assurance that a public market for the Common
Stock will exist at any time subsequent to this offering. As a
result, investors who may wish or who need to dispose of all or a
part of their investment in the Common Stock may not be able to do
so except for private direct negotiations with third parties,
assuming that third parties are willing to purchase the Common
Stock.
CERTAIN PROVISIONS OF THE COMPANY'S
ARTICLES OF INCORPORATION AND BYLAWS
The Articles of Incorporation of the Company contain certain
provisions which would have the effect of impeding an attempt to
change or remove management of the Company or to gain control of
the Company in a transaction not supported by its Board of
Directors. The Articles of Incorporation of the Company also
contain a provision which eliminates the potential personal
liability of directors for monetary damages. The Bylaws of the
Company contain certain provisions which provide indemnification
for directors of the Company. Each of these provisions is
discussed more fully below.
<PAGE>
Change in Number of Directors
Article 7 of the Articles of Incorporation of the Company
provides that any change in the number of directors of the Company,
as set forth in its Bylaws, would have to be made by the
affirmative vote of 2/3 of the entire Board of Directors or by the
affirmative vote of the holders of at least 2/3 of the outstanding
shares of Common Stock.
Under Georgia law, the number of directors may be increased or
decreased from time to time by amendment to the Bylaws, unless the
Articles of Incorporation provide otherwise or unless the number of
directors is otherwise fixed by the shareholders.
Removal of Directors
Article 8 of the Articles of Incorporation of the Company
provides that directors of the Company may be removed during their
terms with or without cause by the affirmative vote of the holders
of a majority of the outstanding shares of Common Stock. "Cause"
for this purpose is defined as final conviction of a felony,
request or demand for removal by any bank regulatory authority
having jurisdiction over the Company, or determination by at least
2/3 of the incumbent directors of the Company that the conduct of
the director to be removed has been inimical to the best interests
of the Company.
Under Georgia law, any or all of the directors of a corporation
may be removed with or without cause by the affirmative vote of a
majority of the shares represented at a meeting at which a quorum
is represented and entitled to vote thereon, unless the Articles of
Incorporation provide otherwise.
Limitation of Liability
Article 10 of the Company's Article of Incorporation, subject
to certain exceptions, eliminates the potential personal liability
of a director for monetary damages to the Company and to the
shareholders of the Company for breach of a duty as a director.
There is no elimination of liability for (a) a breach of duty
involving appropriation of a business opportunity of the Company,
(b) an act or omission not in good faith or involving intentional
misconduct or a knowing violation of law, (c) a transaction from
which the director derives an improper material tangible personal
benefit, or (d) as to any payment of a dividend or approval of a
stock repurchase that is illegal under the Georgia Business
Corporation Code. Article 10 does not eliminate or limit the right
of the Company or its shareholders to seek injunctive or other
equitable relief not involving monetary damages.
Article 10 was adopted by the Company pursuant to the Georgia
Business Corporation Code which allows Georgia corporations, with
the approval of their shareholders, to include in their Articles of
Incorporation a provision eliminating or limiting the liability of
directors, except in the circumstances described above. Article 10
was included in the Company's Articles of Incorporation to
encourage qualified individuals to serve and remain as directors of
the Company. While the Company has not experienced any problems in
locating directors, it could experience difficulty in the future as
the Company's business activities increase and diversify. Article
10 was also included to enhance the Company's ability to secure
liability insurance for its directors at a reasonable cost. While
the Company intends to obtain liability insurance covering actions
taken by its directors in their capacities as directors, the Board
of Directors believes that the current director's liability
insurance environment, and the environment for the foreseeable
future, is characterized by increasing premiums, reduced coverage
and an increasing risk of litigation and liability. The Board of
Directors believes that Article 10 will enable the Company to
secure such insurance on terms more favorable than if such a
provision were not included in the Articles of Incorporation.
Supermajority Voting on Certain Transactions
Under Article 12 of the Articles of Incorporation of the Company,
with certain exceptions, any merger or consolidation involving the
Company or any sale or other disposition of all or substantially
all of its assets will require the affirmative vote of the holders
of at least 2/3 of the outstanding shares of Common Stock.
However, if the Board of Directors of the Company has approved the
particular transaction by the affirmative vote of 2/3 of the entire
Board, then the applicable provisions of Georgia law would govern
and shareholder approval of the transaction would require the
affirmative vote of the holders of only a majority of the
outstanding shares of Common Stock entitled to vote thereon.
The primary purpose of this Article is to discourage any party
from attempting to acquire control of the Company through the
acquisition of a substantial number of shares of Common Stock
followed by a forced merger or sale of assets without negotiation
with management. Such a merger or sale might not be in the best
interests of the Company or its shareholders. This provision may
also serve to reduce the risk of a potential conflict of interest
between a substantial shareholder on the one hand and the Company
and its other shareholders on the other.
The foregoing provision could enable a minority of the Company
shareholders to prevent a transaction favored by the majority of
the shareholders. Also, in some, circumstances, the directors
could cause a 2/3 vote to be required to approve the transaction by
withholding their consent to such a transaction, thereby enhancing
their positions with the Company and the Bank. However, of the
eleven persons who are directors of the Company, only one will be
affiliated with the Company and the Bank in a full-time management
position.
Evaluation of an Acquisition Proposal
Article 13 of the Company's Articles of Incorporation provides
that the response of the Company to any acquisition proposal made
by another party will be based on the Board's evaluation of the
best interests of the Company and its shareholders. As used
herein, the term "acquisition proposal" refers to any offer of
another party (a) to make a tender offer or exchange offer for any
equity security of the Company, (b) to merge or consolidate the
Company with another corporation, or (c) to purchase or otherwise
acquire all or substantially all of the properties and assets owned
by the Company.
Article 13 charges the Board, in evaluating an acquisition
proposal, to consider all relevant factors, including (a) the
expected social and economic effects of the transaction on the
employees, customers and other constituents (e.g., suppliers of
goods and services) of the Company and the Bank, (b) the expected
social and economic effects on the communities within which the
Company and the Bank operate, and (c) the consideration being
offered by the other corporation in relation (i) to the then
current value of the Company as determined by a freely negotiated
transaction and (ii) to the Board of Directors' then estimate of
the Company's future value as an independent entity. The
enumerated factors are not exclusive, and the Board may consider
other relevant factors.
This Article has been included in the Company's Articles of
Incorporation because the Bank is charged with providing support to
and being involved with the communities it serves, and the Board
believes its obligations in evaluating an acquisition proposal
extend beyond evaluating merely the consideration being offered in
relation to the then market or book value of the Common Stock. No
provisions of Georgia law specifically enumerate the factors a
corporation's board of directors should consider in the event the
corporation is presented with an acquisition proposal.
While the value of the consideration offered to shareholders is
the main factor when weighing the benefits of an acquisition
proposal, the Board believes it appropriate also to consider all
other relevant factors. For example, this Article directs the
Board to evaluate the consideration being offered in relation to
the then current value of the Company determined in a freely
negotiated transaction and in relation to the Board's then estimate
of the future value of the Company as an independent concern. A
takeover bid often places the target corporation virtually in the
position of making a forced sale, sometimes when the market price
of its stock may be depressed. The Board believes that frequently
the consideration offered in such a situation, even though it may
be in excess of the then market value (i.e., the value at which
shares are then currently trading), it is less than that which
could be obtained in a freely negotiated transaction. In a freely
negotiated transaction, management would have the opportunity to
seek a suitable partner at a time of its choosing and to negotiate
for the most favorable price and terms which reflect not only the
current value, but also the future value of the Company.
One effect of this Article may be to discourage a tender offer
in advance. Often an offeror consults the Board of a target
corporation prior to or after commencing a tender offer in an
attempt to prevent a contest from developing. In the opinion of
the Board, this provision will strengthen its position in dealing
with any potential offeror which might attempt to acquire the
Company through a hostile tender offer. Another effect of this
Article may be to dissuade shareholders who might be displeased
with the Board's response to an acquisition proposal from engaging
the company in costly litigation. This provision, however, does
not affect the right of a shareholder displeased with the Board's
response to an acquisition proposal to institute litigation against
the Company and to allege that the Board breached an obligation to
shareholders by not limiting its evaluation of an acquisition
proposal to the value of the consideration being offered in
relation to the then market or book value of the Common Stock.
Article 13 would not make an acquisition proposal regarded by the
Board as being in the best interests of the Company more difficult
to accomplish. It would, however, permit the Board to determine
that an acquisition proposal was not in the best interests of the
Company (and thus to oppose it) on the basis of the various factors
deemed relevant. In some cases, such opposition by the Board might
have the effect of maintaining the positions of incumbent
management.
Amendment of Provisions
Any amendment of Articles 7, 8, 10, 12, and 13 of the Company's
Articles of Incorporation requires the affirmative vote of the
holders of at least 2/3 of the outstanding shares of Common Stock,
unless 2/3 of the entire Board of Directors approves the amendment.
If 2/3 of the Board approves the amendment, the applicable
provisions of Georgia law would govern, and the approval of only a
majority of the outstanding shares of Common Stock would be
required.
Indemnification
The Bylaws of the Company contain certain indemnification
provisions which provide that directors, officers, employees or
agents of the Company will be indemnified against expenses actually
and reasonably incurred by them if they are successful on the
merits of a claim or proceedings.
When a case or dispute is not ultimately determined on its merits
(i.e., it is settled), the indemnification provisions provide that
the Company will indemnify directors when they meet the applicable
standard of conduct. The applicable standard of conduct is met if
the director acted in a manner he or she reasonably believed to be
in or not opposed to the best interests of the Company and, with
respect to any criminal action or proceeding, if the director had
no reasonable cause to believe his or her conduct was unlawful.
Whether the applicable standard of conduct has been met is
determined by the Board of Directors, the shareholders or
independent legal counsel in each specific case.
The Bylaws of the Company also provide that the indemnification
rights set forth therein are not exclusive of other indemnification
rights to which a director may be entitled under any bylaw,
resolution or agreement either specifically or in general terms
approved by the affirmative vote of the holders of a majority of
the shares entitled to vote thereon. The Company can also provide
for greater indemnification than that set forth in the Bylaws if it
chooses to do so, subject to approval by the Company's
shareholders. The Company may not, however, indemnify a director
for liability arising out of circumstances which constitute
exceptions to limitation of a director's liability for monetary
damages. See "CERTAIN PROVISIONS OF THE COMPANY'S ARTICLES AND
BYLAWS - Limitation of Liability."
The indemnification provisions of the Bylaws specifically provide
that the Company may purchase and maintain insurance on behalf of
any director against any liability asserted against such person and
incurred by him in any such capacity, whether or not the Company
would have had the power to indemnify against such liability.
The Company is not aware of any pending or threatened action,
suit or proceeding involving any of its directors or officers for
which indemnification from the Company may be sought.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "1933 Act") may be permitted to
directors, officers and controlling persons of the Company pursuant
to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the 1933 Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities other than the payment by
the Company of expenses incurred or paid by the director, officer
or controlling person of the Company in the successful defense of
any action, suit or proceedings is asserted by such director,
officer or controlling person in connection with the securities
being registered, the Company will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the 1933 Act and will be governed by the final adjudication of such
issue.
SUPERVISION AND REGULATION
Bank holding companies and banks are extensively regulated under
both federal and state law. The following is a brief summary of
certain statutes, rules and regulations affecting the Company and
the Bank. This summary is qualified in its entirety by reference
to the particular statutory and regulatory provision referred to
below and is not intended to be an exhaustive description of the
statutes or regulations applicable to the business of the Company
and the Bank. Supervision regulation and examination of the
Company and the Bank by the bank regulatory agencies are intended
primarily for the protection of depositors rather than shareholders
of the Company.
Bank Holding Company Regulation
The Company will be a registered holding company under the Bank
Holding Company act of 1956 (the "BHC Act") and the Georgia Bank
Holding Company Act (the "Georgia BHC Act") and will be regulated
under such acts by the Board of Governors of the Federal Reserve
System (the "Federal Reserve") and by the Department of Banking,
respectively.
As a bank holding company, the Company is required to file annual
reports with the Federal Reserve and the Department of Banking and
such additional information as the applicable regulator may require
pursuant to the BHC Act and the Georgia BHC Act. The Federal
Reserve and the Department of Banking may also conduct examinations
of the Company to determine whether it is in compliance with both
BHC Acts and the regulations promulgated thereunder.
The BHC Act also requires every bank holding company to obtain
prior approval from the Federal Reserve before acquiring direct or
indirect ownership or control of more than 5% of the voting shares
of any bank which is not already majority owned or controlled by
that bank holding company. Acquisition of any additional banks
would also require prior approval from the Department of Banking.
On September 29, 1994, President Clinton signed the Riegle-Neal
Interstate Banking and Branching Efficiency Act of 1994 (the
"Interstate Act") which amends federal law to permit bank holding
companies to acquire existing banks in any state effective
September 29, 1995, and any interstate bank holding company is
permitted to merge its various bank subsidiaries into a single bank
with interstate branches effective June 1, 1997. States have the
authority to authorize interstate branching prior to June 1, 1997
or alternatively, to opt out of interstate branching prior to that
date.
In addition to having the right to acquire ownership or control
of other banks, a bank holding company is authorized to acquire
ownership or control of nonbanking companies, provided the
activities of such companies are so closely related to banking or
managing or controlling banks that the Federal Reserve considers
such activities to be proper to the operation and control of banks.
Regulation Y, promulgated by the Federal Reserve, sets forth those
activities which are regarded as closely related to banking or
managing or controlling banks and, thus, are permissible activities
for bank holding companies, subject to approval by the Federal
Reserve in individual cases.
Federal Reserve policy requires a bank holding company to act as
a source of financial strength and to take measures to preserve and
protect bank subsidiaries in situations where additional
investments in a troubled bank may not be warranted. Under these
provisions, a bank holding company may be required to loan money to
its subsidiaries in the form of capital notes or other instruments
which qualify for capital under regulatory rules. Any loans by the
holding company to such subsidiary banks are likely to be unsecured
and subordinated to such bank's depositors and perhaps to its other
creditors.
Bank Regulation
The Company will initially have one subsidiary bank. The Bank
will be a state bank chartered under the laws of the State of
Georgia and will be subject to examination by the Department of
Banking. The Department of Banking regulates or monitors all areas
of a bank's operations and activities, including reserves, loans,
mergers, issuance of securities, payment of dividends, interest
rates and establishment of branches.
The Bank will also be insured and regulated by the Federal
Deposit Insurance Corporation (the "FDIC"). The major functions of
the FDIC with respect to insured banks include paying depositors to
the extent provided by law in the event an insured bank is closed
without adequately providing for payment of the claims of
depositors, acting as a receiver of state banks placed in
receivership when so appointed by state authorities, and preventing
the continuance or development of unsound and unsafe banking
practices. In addition, the FDIC is authorized to examine insured
state banks which are not members of the Federal Reserve to
determine the condition of such banks for insurance purposes. The
FDIC also approves conversions, mergers consolidations and
assumption of deposit liability transactions between insured banks
and noninsured banks or institutions to prevent capital or surplus
diminution in such transactions where the resulting, continued or
assuming bank is an insured non-member state bank.
Subsidiary banks of a bank holding company are subject to certain
restrictions imposed by the BHC Act on any extension of credit to
the bank holding company or any of its subsidiaries, on investment
in the stock or other securities of the bank holding company or its
subsidiaries, and on the taking of such stock or securities as
collateral for loans to any borrower. In addition, a bank holding
company and its subsidiaries are prohibited for engaging in certain
tying arrangements in connection with any extension of credit or
provision of any property or services.
Capital Requirements
Regulatory agencies measure capital adequacy with a framework
that makes capital requirements sensitive to the risk profile of
the individual banking institution. The guidelines define capital
as either Tier 1 capital (primary shareholders equity) or Tier 2
capital (certain debt instruments and a portion of the reserve for
loan losses). There are two measures of capital adequacy for bank
holding companies and their subsidiary banks: the Tier 1 leverage
ratio and the risk-based capital requirements. Bank holding
companies and their subsidiary banks must maintain a minimum Tier
1 leverage ratio of 4%. In addition, Tier 1 capital must equal 4%
of risk-weighted assets, and total capital (Tier 1 plus Tier 2)
must equal 8% of risk-weighted assets. These are minimum
requirements, however, and institutions experiencing internal
growth (which will initially be the case for the Bank) or making
acquisitions, as well as institutions with supervisory or
operational weaknesses, will be expected to maintain capital
positions well above these minimum levels.
The federal banking agencies have proposed amending the capital
adequacy standards to provide for the consideration of interest
rate risk in the overall determination of a bank's capital ratio
and to require banks with greater interest rate risk to maintain
adequate capital for the risk. It is uncertain what effect these
regulations, when implemented, would have on the Company and the
Bank.
The Federal Deposit Insurance Corporation Improvements Act of
1991 (the "1991 Act") imposes a regulatory matrix which requires
the federal banking agencies to take prompt corrective action to
deal with depository institutions that fail to meet their minimum
capital requirements or are otherwise in a troubled condition. The
prompt corrective action provisions require undercapitalized
institutions to become subject to an increasingly stringent array
of restrictions, requirements and prohibitions, as their capital
levels deteriorate and supervisory problems mount. Should these
corrective measures provide unsuccessful in recapitalizing the
institution and correcting its problems, the 1991 Act mandates that
the institution be placed in receivership.
Pursuant to regulations promulgated under the 1991 Act, the
corrective actions that the banking agencies either must or may
take are tied primarily to an institution's capital levels. In
accordance with the framework adopted by the 1991 Act, the banking
agencies have developed a classification system, pursuant to which
all banks and thrifts are placed into one of five categories:
well-capitalized institutions, adequately capitalized institutions,
undercapitalized institutions, significantly undercapitalized
institutions and critically undercapitalized institutions. The
capital thresholds established for each of the categories are as
follows:
<TABLE>
<S> <C> <C> <C> <C>
Capital Tier 1 Total Risk- Tier 1 Risk-
Category Capital Based Capital Based Capital Other
Well Capitalized 5% or more 10% or more 6% or more Not Subject
to a capital
directive
Adequately 4% or more 8% or more 4% of more -
Capitalized
Undercapitalized less than 4% less than 8% less than 4% -
Significantly less than 3% less than 6% less than 3% -
Undercapitalized
Critically 2% or less - - -
Undercapitalized tangible equity
</TABLE>
The capital guidelines can affect the Company in several ways.
After completion of this offering, the Company's capital levels
will initially be more than adequate. However, rapid growth, poor
loan portfolio performance, poor earnings performance, or a
combination of these factors, could change the Company's capital
position in a relatively short period of time, making an additional
capital infusion necessary.
The Department of Banking will require the Bank to maintain a
ratio (the "primary capital ratio") of total capital (which is
essentially Tier 1 capital plus the allowance for loan losses) to
total assets (defined as balance sheet assets plus the allowance
for loan losses) of at least 6%. In addition, the Bank expects
that, in accordance with the Department of Banking policy, the Bank
will be required to maintain a primary capital ratio of 8% during
its first three years of operation.
CRA and Fair Lending
On April 19, 1995, the federal bank regulatory agencies adopted
revisions to the regulations promulgated pursuant to the Community
Reinvestment at (the "CRA"), which are intended to set distinct
assessment standard for financial institutions. The revised
regulation contains three evaluation tests: (a) a lending test
which will compare the institution's market share of loans in low-
and moderate-income areas to its market share of loans in its
entire service area and the percentage of a bank's outstanding
loans to low- and moderate-income areas or individuals, (b) a
services test which will evaluate the provision of services that
promote the availability of credit to low- and moderate-income
areas, and (c) an investment test, which will evaluate an
institution's record of investments in organizations designed to
foster community development, small- and minority-owned businesses
and affordable housing lending, including state and local
government housing or revenue bonds. The regulation is designed to
reduce the paperwork requirements of the current regulations and
provide regulators, institutions and community groups with a more
objective and predictable manner with which to evaluate the CRA
performance of financial institutions. The rule became effective
on January 1, 1996, at which time evaluation under streamlined
procedures began for institutions with assets of less than $250
million that are owned by a holding company with total assets of
less than $1 billion.
Congress and various federal agencies (including, in addition
to the bank regulatory agencies, the Department of Housing and
Urban Development, the Federal Trade Commission and the Department
of Justice) (collectively the "Federal Agencies") responsible for
implementing the nation's fair lending laws have been increasingly
concerned that prospective home buyers and other borrowers are
experiencing discrimination in their efforts to obtain loans. In
recent years, the Department of Justice has filed suit against
financial institutions which it determined had discriminated,
seeking fines and restitution for borrowers who allegedly suffered
from discriminatory practices. Most, if not all, of these suits
have been settled (some for substantial sums) without a full
adjudication on the merits.
On March 8, 1994, the Federal Agencies, in an effort to clarify
what constitutes lending discrimination and to specify the factors
the agencies will consider in determining if lending discrimination
exists, announced a joint policy statement detailing specific
discriminatory practices prohibited under the Equal Credit
Opportunity Act and the Fair Housing Act. In the policy statement,
three methods of proving lending discrimination were identified:
(a) overt evidence of discrimination, when a lender blatantly
discriminates on a prohibited basis, (b) evidence of disparate
treatment, when a lender treats applicants differently based on a
prohibited factor even where there is no showing that the treatment
was motivated by prejudice or a conscious intention to discriminate
against a person, and (c) evidence of disparate impact, when a
lender applies a practice uniformly to all applicants, but the
practice has a discriminatory effect, even where such practices are
neutral on their face and are applied equally, unless the practice
can be justified on the basis of business necessity.
FDIC Insurance Assessments
The Bank will be subject to FDIC deposit insurance assessments
for the Bank Insurance Fund. The FDIC has implemented a risk-based
assessment system whereby banks are assessed on a sliding scale
depending on their placement in nine separate supervisory
categories. The highest-rated institutions pay the statutory
annual minimum of $2,000 for FDIC insurance. Rates for all other
institutions are reduced by four cents per $100 as well, leaving a
premium range of 3 cents to 27 cents per $100 of deposits. For
FDIC deposit insurance, the Bank will initially pay an annual FDIC
deposit insurance assessment of 4.3 cents per $100 of deposits.
Future Requirements
Statutes and regulations are regularly proposed which contain
wide-ranging proposals for altering the structures, regulations and
competitive relationship of the nation's financial institutions.
It cannot be predicted whether or what form any proposed statute or
regulation will be adopted or the extent to which the business of
the Company and the Bank may be affected by such statute or
regulation.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed
upon for the Company by Stewart, Melvin & Frost, LLP, Gainesville,
Georgia.
EXPERTS
The financial statements of the Company at August 31, 1996, and
for the period from March 15, 1996 (inception) until August 31,
1996, set forth herein have been so included in reliance on the
report of Snyder, Camp, Stewart & Co., LLP, independent certified
public accountants, given on the authority of that firm as experts
in accounting and auditing.
<PAGE>
FIRST GEORGIA COMMUNITY CORP.
(A development stage company)
Financial Statements
For the Period Ending August 31, 1996
<PAGE>
FIRST GEORGIA COMMUNITY CORP.
(A Development Stage Corporation)
Index to Financial Statements
Independent Auditors' Report F-2
Financial Statements:
Balance Sheet as of August 31, 1996 F-3
Statement of Operations for the period
from March 15, 1996
(inception) to August 31, 1996 F-4
Statement of Stockholder's Equity for
the period from March 15, 1996
(inception) to August 31, 1996 F-5
Statement of Cash Flows for the
period from March 15, 1996
(inception) to August 31, 1996 F-6
Notes to Financial Statements F-7
F-1
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
First Georgia Community Corp.
We have audited the accompanying balance sheet of First Georgia Community
Corp. (a development stage corporation) as of August 31, 1996, and the
related statements of operations, stockholder's equity and cash flows for
the period from March 15, 1996 (inception) to August 31, 1996. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based
on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe
that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of First Georgia Community
Corp. as of August 31, 1996 and the results of its operations and its cash
flows for the period from March 15, 1996 (inception) to August 31,
1996 in conformity with generally accepted accounting principles.
/s/ SNYDER, CAMP, STEWART & CO., LLP
Norcross, Georgia
September 17, 1996
F-2
<PAGE>
FIRST GEORGIA COMMUNITY CORP.
(A Development Stage Corporation)
Balance Sheet
August 31, 1996
<TABLE>
<S> <C>
Assets
Cash $ 8,778.78
Deferred organization costs 53,742.22
Other assets 18,839.00
$ 81,360.00
Liabilities and Stockholder's Equity
Liabilities:
Advances from organizers $ 106,000.00
Accrued expenses 233.21
Total liabilities 106,233.21
Stockholder's equity:
Capital stock, $5.00 par value; 10,000,000 shares
authorized; 1 share issued and outstanding 5.00
Additional paid-in capital 5.00
Accumulated deficit (24,883.21)
Total stockholder's equity (24,873.21)
$ 81,360.00
</TABLE>
See accompanying auditors' report and notes to financial statements.
F-3
FIRST GEORGIA COMMUNITY CORP.
(A Development Stage Corporation)
Statement of Operations
For the Period from March 15, 1996 (inception) to August 31, 1996
<TABLE>
<S> <C>
Expenses:
Personnel expenses $ (24,650.00)
Interest (233.21)
Net loss $ (24,883.21)
</TABLE>
See accompanying auditors' report and notes to financial statements.
F-4
FIRST GEORGIA COMMUNITY CORP.
(A Development Stage Corporation)
Statement of Stockholder's Equity
For the Period from March 15, 1996 (inception) to August 31, 1996
<TABLE>
Deficit
Accumulated
Additional During the
Preferred Common Paid-in Development
Stock Stock Capital Stage Total
<S> <C> <C> <C> <C> <C>
Proceeds from
the sale of
organization shares $ - 5.00 5.00 - 10.00
Net loss - - - (24,883.21) (24,883.21)
Balance, August 31,
1996 $ - 5.00 5.00 (24,883.21) (24,873.21)
</TABLE>
See accompanying auditors' report and notes to financial statements.
F-5
FIRST GEORGIA COMMUNITY CORP.
(A Development Stage Corporation)
Statement of Cash Flows
For the Period from March 15, 1996 (inception) to August 31, 1996
<TABLE>
<C> <S>
Cash flows from operating activities:
Net loss $ (24,883.21)
Adjustments to reconcile net loss to net cash used
for operating activities:
Increase in deferred expenses (53,742.22)
Increase in accrued expenses 233.21
Net cash used for operating activities (78,392.22)
Cash flows from investing activities:
Increase in other assets 18,839.00
Net cash used by investing activities (18,839.00)
Cash flows from financing activities:
Proceeds from the sale of organization shares 10.00
Increase in advances from organizers 106,000.00
Net cash provided by financing activities 106,010.00
Net increase in cash and cash equivalents $ 8,778.78
</TABLE>
See accompanying auditors' report and notes to financial statements.
F-6
<PAGE>
FIRST GEORGIA COMMUNITY CORP.
(A Development Stage Corporation)
Notes to Financial Statements
August 31, 1996
(1) Organization and Summary of Significant Accounting Policies
First Georgia Community Corp. (the "Company") was incorporated on August 7,
1996, for the purpose of becoming a bank holding company for its proposed
wholly-owned subsidiary, First Georgia Community Bank (the "Bank"), which
will operate in the Butts County area. The organizers of the Bank filed a
joint application to charter the Bank with the Department of Banking and
Finance and the Federal Deposit Insurance Corporation. The Company is also
making an application to become a bank holding company with the Federal
Reserve Bank of Atlanta.
Neither the Company nor the Bank has commenced their respective operations as a
bank holding company or as a commercial bank and neither will do so unless
regulatory approvals are obtained and the required capitalization of the Bank
by the Company is obtained from proceeds of the sale of the Company's common
stock.
Prior to the Company's incorporation on August 7, 1996, organizational and
pre-opening activities were conducted by the organizers. Expenditures on
behalf of the Company by the organizers are considered expenditures of the
Company. Costs of organizing the Company have been capitalized and will be
amortized over five years using the straight-line method upon commencement of
operations. Costs of the intended common stock offering have been deferred
and will be offset against the proceeds of the offering upon successful
completion. These costs will be charged to expense if the minimum offering
is not purchased. Additional costs are expected to be incurred for both
organization costs and stock offering costs.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
Financial instruments that potentially subject the Company to credit risk
include cash on deposit with banks. The Company has a deposit relationship
with a high credit quality financial institution and has yet to accumulate
balances in excess of federal deposit insurance limits. Accordingly, the
Company believes no significant concentration of credit risks with respect to
its deposit balances with financial institutions. The fair values of cash
and interest bearing borrowings approximate their carrying amounts.
The Company plans to adopt a calendar year for both financial reporting and
tax reporting purposes.
FIRST GEORGIA COMMUNITY CORP.
(A Development Stage Corporation)
Notes to Financial Statements, Continued
August 31, 1996
(2) Advances from Organizers
Advances from organizers at August 31, 1996 consist of the following:
Line of credit balance $ 51,000
Direct advances from organizers 55,000
$106,000
Prior to incorporation, the organizers secured a line of credit with a
maximum limit of $500,000. Organizational costs, pre-opening expenses, and
offering expenses incurred prior to commencing operations, will be funded
through the use of this line. The line has a maturity date of June 10, 1997
and carries an initial interest rate of 8.25%, which varies with the prime
rate. The direct advances from the organizers are non-interest bearing.
Upon successful completion of the sale of common stock, the organizers will
be reimbursed from the proceeds from the offering. If the offering is
not successful, the line of credit will be repaid by the organizers and the
direct advances will not be repaid.
(3) Common Stock Offering
The Company intends to file a Registration Statement on Form SB-2 with the
Securities and Exchange Commission offering for sale a minimum of 610,000 and a
maximum of 800,000 shares of the Company's $5.00 par value common stock at $10
per share.
(4) Stock Option Plan
The Company plans to offer stock options for as many as 20,000 shares of its
common stock to its President under terms of an employment agreement. The per
share exercise price for all options granted pursuant to the employment
agreement is the greater of book value or $10. The Financial Accounting
Standards Board issued Statement No. 123, "Accounting for Stock-Based
Compensation," (SFAS No. 123) in October 1995. SFAS No. 123 allows companies
either to (i) continue to measure compensation cost based on the
"intrinsic value" method prescribed by Accounting Principles Board Opinion
No. 25 (ABP No. 25) or (ii) adopt a "fair value" method of accounting for all
employee stock-based compensation; provided, however that in either case
companies will be required to significantly expand disclosures related to
stock-based employee compensation arrangements (including the pro forma amount
of net income and earnings per share as if the new "fair value" method were
adopted, for those companies choosing to retain the "intrinsic value" method
of APB No. 25). The accounting requirements, as specified in SFAS No. 123,
applying to all stock-based awards granted, modified or settled in cash in
fiscal years beginning after December 15, 1995. The Company expects to
utilize the accounting for stock issued to employees prescribed by APB No. 25
and, therefore, the impact on the Company of this change in accounting
principle will be only to increase its disclosure requirements.
(5) Commitments
The Company has assumed agreements of an organizer, as purchaser, for the
purchase of properties to be used for banking locations. The aggregate
contract purchase price for these properties is $395,000. Closing is
contingent upon approval by regulatory authorities and successful completion
of the sale of the Company's stock.
The organizers of the Bank have entered into an employment agreement with one of
the organizing directors to serve as President and Chief Executive Officer of
the Company and the Bank providing for an annual base salary, the right to
receive a bonus (based upon performance standards), the right to receive stock
options, and other customary executive benefits.
(6) Income Taxes
As of August 31, 1996 no income tax expense (benefit) has been provided,
nor have any deferred income taxes have been recorded due to the loss incurred.
As of August 31, 1996 the Company had a tax loss carryforward of
approximately $25,000 which will expire in the year 2011. This loss
carryforward results in a gross deferred tax asset of approximately $9,600
which has been reduced by a valuation allowance of like amount. The gross
deferred tax asset differs from the expected amount primarily due to the
effect of state income taxes.
<PAGE>
SUBSCRIPTION AGREEMENT EXHIBIT "A"
First Georgia Community Corp.
150 Covington Street
P. O. Box 1534
Jackson, Georgia 30233
Attn: John L. Coleman
Gentlemen:
The undersigned hereby subscribes for and agrees to purchase the
number of shares of Common Stock, par value $5.00 per share (the
"Common Stock"), of First Georgia Community Corp., a Georgia
corporation (the "Company"), indicated below. The undersigned has
executed and delivered this Subscription Agreement in connection
with the Company's offering of Common Stock described in its
Prospectus date _____________________, 1996. (Such Prospectus,
including any amendments and supplements thereto, is herein called
the "Prospectus").
The undersigned agree to purchase the shares of Common Stock
subscribed for herein for the purchase price of $10.00 per share.
All checks should be made payable to "The Bankers Bank - Escrow
Account for First Georgia Community Corp." A check in an amount
equal to the full subscription price is enclosed with this
Subscription Agreement.
The undersigned acknowledges receipt of a copy of the Prospectus.
The undersigned further acknowledges that the Company has not yet
begun operations and that an investment in the Common Stock
involves significant risks, as set forth under "Risk Factors" in
the Prospectus. The undersigned understands that no federal or
state agency has made any finding or determination regarding the
fairness of the offering of the Common Stock, the accuracy or
adequacy of the Prospectus, or any recommendations or endorsement
concerning an investment in the Common Stock.
The undersigned agrees that this subscription is binding on the
undersigned and is irrevocable by the undersigned until the
Expiration Date as defined in the Prospectus. The undersigned
acknowledges that this Subscription Agreement shall not constitute
a valid and binding obligation of the Company until accepted by the
Company in writing, and that the Company has the right to reject
this Subscription Agreement, either in whole or in part, in its
sole discretion.
<PAGE>
Number of Shares
minimum 100 shares): __________ _____________________________
Please PRINT or TYPE exact
name(s) in which undersigned
desires to be registered
Total Subscription Price
(at $10.00 per share): $_________
<PAGE>
SUBSTITUTE W-9
Under the penalties of perjury, I certify that: (a) the Social
Security number of Taxpayer Identification Number given below is
correct; and (2) I am not subject to backup withholding.
INSTRUCTION: YOU MUST CROSS OUT #2 ABOVE IF YOU HAVE BEEN NOTIFIED
BY THE INTERNAL REVENUE SERVICE THAT YOU ARE SUBJECT TO BACKUP
WITHHOLDING BECAUSE OF UNDER REPORTING INTEREST OR DIVIDENDS ON
YOUR TAX RETURN.
___________________________ ______________________________
Date Signatures(s)*
___________________________ ______________________________
Area Code and Telephone No. Please indicate form of
ownership the undersigned
desires for the shares
(individual, joint tenants
with right of survivorship,
tenants in common, trust,
corporation, partnership,
custodian, etc.)
___________________________
Social Security or
Federal Taxpayer ________________________________
Identification No. Street Address
_______________________________
City/State/Zip Code
TO BE COMPLETED BY THE COMPANY
Accepted as of ___________________________, 199___, as to
____________ shares.
FIRST GEORGIA COMMUNITY CORP.
By:________________________
Signature
________________________
Print Name
* When signing as attorney, trustee, administrator, or guardian,
please give your full title as such. If a corporation, please
sign in full corporate name by president or other authorized
officer. In case of joint tenants, each joint owner must sign.
_____________________________________________________
The Company reserves the right, in its sole discretion to
reject any and all subscriptions, and no subscription will be
effective until accepted by the Company.
No person has been authorized by the Company to give any
information or to make any representations not contained
in this Prospectus, and any information or statement not
contained herein must not be relied upon as having been
authorized by the Company. The delivery of this
Prospectus does not imply that the information contained
herein is correct as of any time subsequent to its date.
The Company has undertaken to update this Prospectus to
reflect any facts or events arising after the date hereof,
which individually or in the aggregate represent a
fundamental change in the information set forth herein and
to include any material information with respect to the plan
of distribution not previously disclosed in the Prospectus or
any material changes to such information.
Subscribers should not construe the contents of this
Prospectus or any communication from the Company,
whether written or oral, as legal, tax accounting, or other
expert advice. Each subscriber should consult his or her
own counsel, accountants and other professional advisors
as to all matters concerning his or her investment in shares
of the Common Stock.
The shares of Common Stock of the Company offered
hereby are not deposits insured by the Federal Deposit
Insurance Corporation.
This Prospectus does not constitute an offer to sell in any
jurisdiction or a solicitation of an offer to buy any of the
shares of the Common Stock to any person in any
jurisdiction in which such offer or solicitation is unlawful.
TABLE OF CONTENTS
Page
Risk Factors..................................................
The Offering..................................................
Use of Proceeds.............................................
Capitalization.................................................
Dividends......................................................
Business of the Company and the Bank............
Management.................................................
Market for Common Stock and Related
Shareholder Matters.....................................
Description of Common Stock of the
Company....................................................
Certain Provisions of the Company's
Articles of Incorporation and
ByLaws......................................................
Supervision and Regulation.............................
Legal Matters................................................
Experts.........................................................
Financial Statements......................................F-1
Subscription Agreement..................................Exhibit "A"
_____________________________________________________
<PAGE>
_____________________________________________________
FIRST GEORGIA COMMUNITY CORP.
A Proposed Bank Holding Company
for
FIRST GEORGIA COMMUNITY BANK
A Proposed State Bank
800,000
Shares of
Common Stock
PROSPECTUS
____________________________________
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 24. Indemnification of Directors and Officers.
Consistent with the pertinent provisions of the laws of Georgia,
the Registrant's Articles of Incorporation provide that the
Registrant shall have the power to indemnify its directors and
officers against expenses (including attorney's fees) and
liabilities arising from actual or threatened actions, suits or
proceedings, whether or not settled, to which they become subject
by reason of having served in such role if such director or officer
acted in good faith and in a manner he or she reasonably believed
to be in or not opposed to the best interests of the Registrant
and, with respect to a criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful.
Advances against expenses shall be made so long as the person
seeking indemnification agrees to refund the advances if it is
ultimately determined that he or she is not entitled to
indemnification. A determination of whether indemnification of a
director or officer is proper because he or she met the applicable
standard of conduct shall be made (a) by the Board of Directors of
the Registrant, (b) in certain circumstances, by independent legal
counsel in a written opinion, or (c) by the affirmative vote of a
majority of the shares entitled to vote.
Item 25. Other Expenses of Issuance and Distribution.
Expenses of the sale of the Registrant's Common Stock, $5.00 par
value, are as follows:
Registration Fee $ 2,414
Legal Fees and Expenses (Estimate) 20,000
Accounting Fees and Expenses (Estimate) 5,000
Printing and Engraving Expenses (Estimate) 2,500
Miscellaneous (Estimate) 5,086
Total $ 35,000
Item 26. Recent Sales of Unregistered Securities.
On August 8, 1996, the Registrant issued to John L. Coleman, in
a private placement one share of the Registrant's Common Stock,
$5.00 par value per share, for an aggregate purchase price of $10
in connection with the organization of the Company. The sale to
Mr. Coleman was exempt from registration under the Securities Act
of 1933 pursuant to Section 4(2) of such Act because it was a
transaction by an issuer which did not involve a public offering.
Item 27. Exhibits.
Exhibit Description
Number
[No exhibits to this Amendment No. 2]
Item 28. Undertakings.
The undersigned Registrant hereby undertakes as follows:
(a) (1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events which,
individually or together represent a fundamental change
in the information set forth in the Registration
Statement, and notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not
exceed that which was registered) and any deviation from
the low or high end of the estimated offering rate may
be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in column and price represent no more than
a 20% change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in
the effective Registration Statement;
(iii) To include any additional or changed material
information the plan of distribution.
(2) For the purpose of determining any liability under the
Securities Act of 1933, to treat each post-effective amendment
as a new Registration Statement of the securities offered, and
the offering of the securities at the time shall be deemed to be
the initial bona fide offering.
(3) To file a post-effective amendment to remove from
registration any of the securities being registered which remain
unsold at the termination of this offering.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the provisions set forth in Item 24, or otherwise, the Registrant
has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements of filing on Form SB-2 and
authorized this Amendment No. 2 to the registration statement
to be signed on its behalf by the undersigned, in the City of
Jackson, State of Georgia, on December 5, 1996.
FIRST GEORGIA COMMUNITY CORP.
By: s/John L. Coleman
Print Name: John L. Coleman
Title: President and Chief Executive
Officer
Pursuant to the requirements to the Securities Act of 1933, this
Amendment No. 2 to the Registration Statement has been signed by
the following persons in the capacities and on the date indicated.
Name Position Date
s/John L. Coleman Director; President 12/5/96
John L. Coleman and C.E.O.
s/Alfred D. Fears, Jr. Director; Corporate 12/5/96
Alfred D. Fears, Jr. Secretary and C.A.O.
s/Harry Lewis Director; Treasurer 12/5/96
Harry Lewis and C.F.O.
s/D. Richard Ballard Director 12/5/96
D. Richard Ballard
s/Charles W. Carter Director 12/5/96
Charles W. Carter
s/William B. Jones Director 12/5/96
William B. Jones
__________________________ Director
Joey McClelland
s/Alexander Pollack Director 12/5/96
Alexander Pollack
<PAGE>
s/Robert Ryan Director 12/5/96
Robert Ryan
Director
James H. Warren
s/George L. Weaver Director 12/5/96
George L. Weaver
