SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Fixed by the Registrant [X]
Filed by a Party Other than the Registrant [ ]
[ ] Preliminary Proxy Statement
[X } Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a 11(c) or rule 14a 12
Southern Security Bank Corporation
__________________________________________________
(Name of Registrant as Specified in its Charter
____________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than Registrant
Payment of Filing Fee (check the appropriate box)
[X ] No fee required
<PAGE>
SOUTHERN SECURITY BANK CORPORATION
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
[LOGO]
October 16, 1998
To the Shareholders of Southern Security Bank Corporation:
Notice is hereby given that, pursuant to the By-Laws, the Annual Meeting of
Shareholders of Southern Security Bank Corporation will be held in the lobby of
the Southern Security Bank, at 3475 Sheridan Street, Hollywood, Florida at 4:00
P.M. on October 27, 1998, for the purpose of considering and voting upon the
following matters:
1) ELECTION OF DIRECTORS: To elect two Group III Directors to hold office until
the 2001 Annual Meeting of Shareholders and until their successors are elected
and qualified; and
2) OTHER BUSINESS: The transaction of such other business as may properly come
before the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on August 31, 1998 as the
record date for the determination of the shareholders entitled to notice of and
to vote at the Annual Meeting or any adjournment thereof.
You are cordially invited to attend. Members of the Board and other executives
of your Company appreciate this opportunity to meet shareholders personally,
exchange views with you and advise you of progress to date.
By Order of the Board of Directors,
SOUTHERN SECURITY BANK CORPORATION
Floyd D. Harper
Vice President & Secretary
<PAGE>
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
SOUTHERN SECURITY BANK CORPORATION
3475 Sheridan Street
Hollywood, Florida 33021
(954) 985-3900
This Proxy Statement is furnished to the holders of Class A Common Stock of
Southern Security Bank Corporation (the "Company") in connection with the
solicitation of proxies on behalf of the Board of Directors for use at the
Annual Meeting of Shareholders of the Company to be held on October 27, 1998 or
any adjournment thereof. This Proxy Statement and form of proxy are first being
sent or given to shareholders on or about October 16, 1998.
Shareholders who execute proxies will retain the right to revoke them at any
time before they are exercised. If you sign and return the enclosed proxy, the
shares represented thereby will be voted for the nominees of the Board of
Directors unless otherwise indicated on the proxy.
Under the Delaware General Corporation Law ("DGCL") and the Company's By-Laws,
the presence, in person or by proxy, of the holders of a majority of the
outstanding shares is necessary to constitute a quorum of the shareholders to
take action at the Annual Meeting. The number of shares whose holders are
present, or represented by proxy, will be counted for quorum purposes regardless
of whether or not a broker with discretionary authority fails to exercise its
discretionary voting authority with respect to any particular matter. Once a
quorum is established, under the DGCL and the Company's By-Laws, the Directors
standing for election must be elected by a plurality of the votes cast. For
voting purposes, all votes cast "for", "against", "abstain", or "withhold
authority" will be voted in accordance with such instruction as to each item.
The cost of solicitation of proxies by the Board of Directors will be borne by
the Company. In addition to solicitations by mail employees of the Company and
its subsidiary may solicit proxies in person, by facsimile transmission, or by
telephone, but no employee of the Company or its subsidiary will receive any
compensation for their solicitation activities in addition to their regular
compensation. The Company will reimburse the reasonable expenses of brokerage
houses and other custodians, nominees, and fiduciaries for forwarding
solicitation material to the beneficial owners of the Company stock held of
record by such persons.
The Board of Directors has fixed the close of business on August 31, 1998 as the
time as of which shareholders entitled to notice of and to vote at the Annual
Meeting shall be determined. There were 4,456,656 shares of the Company's Class
A Common Stock, par value $.01 per share, outstanding and entitled to vote at
the Close of Business on August 31, 1998.
<PAGE>
ELECTION OF DIRECTORS
The Company's Board of Directors is classified into three groups that serve
staggered terms of three years each. At the Annual Meeting, in accordance with
the Company's Certificate of Incorporation and By-Laws, two (2) persons are to
be elected to the Board of Directors as Group III Directors to hold office until
the year 2001 Meeting of Shareholders and until their successors are elected and
qualified.
It is intended that shares represented by properly executed proxies will be
voted, in the absence of contrary instructions, in favor of the election of the
following nominees as Group III Directors -- R. David Butler and Harold C.
Friend. The other groups of directors and their terms of office are as follows:
Group I, serving until 2000 -- Philip C. Modder and Eugene J. Strasser; and
Group II, serving until 1999 -- James L. Wilson and Timothy S. Butler.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE NOMINEES
FOR Group III DIRECTORS
All nominees have consented to serve as Directors, if elected. However, if at
the time of the meeting any nominee should be unable to stand for election, the
persons who are designated as proxies intend to vote, in their discretion, for
such other persons, if any, as may be designated by the Board.
Each Directors is elected for a period of three years. The term of directorships
are staggered as to expiration date, such that each year one-third of the
directorship is subject to re-election. Vacancies and newly created
directorships resulting from any increase in the number of authorized Directors
may be filled by a majority vote of the Directors then remaining in office;
however, any additional Directors or vacancies filled may not take office nor
serve, until proper applications and disclosures are filed with the Federal
Reserve Bank of Atlanta (FRB), for prior approval therefrom. Once approval is
obtained from the FRB, Director[s] may thereafter take office and serve in that
capacity.
Name Term Age Position
Director Since
Philip C. Modder 3yr 57 Chairman of the Board & President
June 1992
James L. Wilson 3yr 53 Vice Chairman, Director, and
June 1992 Chief Executive Officer
Timothy S. Butler* 2yr 48 Director
December 1992
Eugene J. Strasser 2yr 52 Director
December 1992
Harold C. Friend 1yr 51 Director
December 1994
R. David Butler, Jr.* 1yr 49 Director
December 1994
* Timothy S. Butler and R. David Butler, Jr. are cousins.
The following information about the Company's Directors relating to their
principal occupations or employment, name and principal business of the
corporation or other organization in which such occupation or employment is
carried on, and other affiliations has been furnished to the Company by the
respective Directors.
Philip C. Modder: Mr. Modder has been involved in the banking industry in Palm
Beach County for over 25 years. Mr. Modder was educated at the University of
Wisconsin, Racine Wisconsin, Evangel College, Springfield, Missouri, Palm Beach
Junior College, Lake Worth, Florida, and Florida Atlantic University, which
granted him a B.S. Degree in 1969, in the academic areas of Finance and
Accounting. Prior to organizing the subject Company, Mr. Modder was President
and Chief Executive Officer and Organizing Director of Mizner Bank located in
Boca Raton, Florida, from March 1987 to May 1992. Prior thereto, Mr. Modder
served as Senior Vice President of Caribank of Palm Beach County. In 1988,
Caribank of Palm Beach County was merged into its parent, Caribank of Dania.
Prior to that time, Mr. Modder previously served as Senior Vice President and
Area Manager of Atlantic National Bank for five years and Vice President and
Branch Manager for eight years at Sun Bank. Mr. Modder serves as a Director and
was a past Chairman of the Boca Raton Chamber of Commerce, and also serves as
Chairman of the Boca Raton Airport Authority. Mr. Modder has also served as an
instructor for the American Institute of Banking.
James L. Wilson: Mr. Wilson has been involved in banking and the finance
industry in Florida since 1970, was educated at Union College with degree
granted in 1968 in the academic areas of Mathematics and Organic Chemistry.
Prior to organizing the Company, Mr. Wilson was Executive Vice President and
Senor Lending Officer of Boca Bank in Boca Raton, Florida from June 1990 to June
1992. Prior thereto, from June 1985 to May 1990, Mr. Wilson was a Principal of
Bayshore Investments, Tampa, Florida, a real estate finance and property
management company. Mr. Wilson in the mid 1980's was Vice President and Senior
Real Estate Lending Officer for Southeast Bank, Tampa, Florida. Mr. Wilson also
held various positions with Royal Trust Bank (Canada), N.A. with USA offices in
Miami; while at Royal Trust, Wilson was a member of the Bank Acquisition team,
which purchased over a billion dollars in banking companies. Mr. Wilson's
biography has been published in multiple editions of Who's Who of America, the
South and South West, and the World since 1984. Mr. Wilson has also served as an
instructor for the American Institute of Banking.
Timothy S. Butler: Mr. Butler was born in Fort Lauderdale and graduated from
Pompano Beach High School in 1967. He attended Broward Community College and
Florida State University. He has served as President of Butler Properties Ltd.,
since 1971. That Company manages the family assets consisting of farm land and
various other real estate holdings. From January 1989 to June 1992, he served as
an Associate Director of Mizner Bank in Boca Raton.
Eugene J. Strasser, M.D.: Dr. Strasser did his undergraduate work and Pre-Med
work at Loyola College and the University of Maryland where he graduated in
1968. He attended the University of Maryland Medical School in Baltimore,
Maryland where he graduated in 1972. Dr. Strasser is licensed by the American
Medical Board as a Board Certified General Surgeon and a Board Certified Plastic
and Reconstructive Surgeon. He has established his own small, private hospital,
Cosmeplast Center, in Coral Springs, Florida, where he has practiced medicine
since 1981.
Harold C. Friend, M.D.: Dr. Friend has been a resident of South Florida for 21
years. He received his B.A. from the University of Texas, and his M.D. degree
from the University of Texas Southwestern Medical School in 1972. Dr. Friend is
a Board-Certified Neurologist, practicing in Boca Raton. He has been active in
numerous business activities, including past membership of the Mizner Bank's
Advisory Board, President of Puget Sound Yellow Taxi, a transportation company
located in Seattle, Washington from October 1990 to June 1993, and President of
the Neuroscience Center in Boca Raton, Florida from June 1985 to the present. As
to civic involvement, Dr. Friend has held past and present positions with the
Southern Region of the Boy Scouts, Executive Board of United Way, and the Local
and International Rotary. Dir Friend's biography is published in multiple
editions of Who's Who of the South and South West, and the World.
R. David Butler: Mr. Butler was born in Boca Raton, Florida and was reared in
Deerfield Beach, Florida. He attended Carson-Newman College and the University
of Tennessee and was graduated with degrees in Business Administration, English,
and Music. After retiring from Eastern Airlines after fifteen years of service
as a flight services representative, in June of 1991 he established Pegasus
Travel Management, a division of Regit Enterprises, Inc., of which he is
President and Chief Executive Officer. Mr. Butler resides in Coconut Grove,
Florida, this city also being the location of the corporate headquarters of
Regit Enterprises.
<PAGE>
BENEFICIAL OWNERSHIP OF THE COMPANY'S COMMON STOCK
BY CERTAIN PERSONS AND BY MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of August 31, 1998 by each person
known by the Company to be the beneficial owner of more than five percent of all
classes of the Company's voting securities.
<TABLE>
Name & Address of Beneficial Owner Number of Shares (1) Percentage of Outstanding Shares
<S> <C> <C>
Philip C. Modder 1,035,353 (2) 19.4%
3475 Sheridan Street
Hollywood, FL 33021
James L. Wilson 948,252 (3) 17.8%
3475 Sheridan Street
Hollywood, FL 33021
Jack E. & Molly W. Butler, TTE's, 309,343 (4) 5.8%
U/A dated 11/13/90
150 SE 4 Avenue
Deerfield Beach, FL 33441
Robert D. & Martha L. Butler, TTE's 312,948 (5) 5.9%
U/A dated 3/29/90
84 SE 4 Avenue
Deerfield Beach, FL 33441
Linda K. Strasser 398,128 (6) 7.5%
6770 NW 87 Avenue
Parkland, FL 33067
Timothy S. Butler 449,738 (7) 8.5%
H.C. 10, Box 580
Lakemont, GA 30552
Harold C. Friend 281,688 (8) 5.3%
3475 Sheridan Street
Hollywood, FL 33021
</TABLE>
(1) Information presented in this table has been obtained from the respective
shareholders or from filings made with the Securities and Exchange Commission.
Except as otherwise indicated, each holder has sole voting and investment power
with respect to the shares indicated.
(2) Includes options to purchase 335,323 shares that are exercisable within 60
days, and 67,511 shares owned by Mr. Modder's wife.
(3) Includes options to purchase 261,555 shares that are exercisable within 60
days, and 40,844 shares owned by Mr. Wilson's wife.
(4) Jack E. & Molly W. Butler share voting and investment power with respect to
such shares.
(5) Robert D. and Martha L. Butler share voting and investment power with
respect to such shares.
(6) Includes 16,667 shares owned by Linda Strasser's husband and options owned
by him to purchase 100,841 shares that are exercisable within 60 days.
(7) Includes 250,000 shares owned by a trust as to which Mr. Butler has sole
voting and investment power and options to purchase 134,174 shares that are
exercisable within 60 days. (8) Includes options to purchase 19,953 shares that
are exercisable within 60 days, 40,993 shares owned by Dr. Friend's wife, and
152,467 shares owned by Dr. Friend as custodian for his children.
Security Ownership of Directors and Officers
The following table sets forth information concerning the beneficial ownership
of the Company's Common Stock beneficially owned by each Director of the
Company, by each Executive Officer of the Company named in the compensation
table, and by all Directors and Executive Officers of the Company as a group, as
of August 31, 1998.
Name (1) Shares of Class A Common Stock Percentage of Stock
Philip C. Modder 1,035,353 (2) 19.4%
James L. Wilson 948,252 (2) 17.8%
Eugene J. Strasser 398,128 (3) 7.5%
Harold C. Friend 281,688 (2) 5.3%
Robert D. Butler 42,890 (4) 0.8%
Timothy S. Butler 449,738 (2) 8.5%
All Directors and Executive
Officers as a Group (7 Persons) 3,155,049 (5) 58.3%
(1) The business address of each of the persons identified above is at
Southern Security Bank Corporation, 3475 Sheridan Street, Hollywood, Florida
33021.
(2) See footnotes to preceding table.
(3) Includes 272,620 shares owned by Eugene Strasser's wife and options to
purchase 100,841 shares that are exercisable within 60 days.
(4) Includes options to purchase 11,841 shares that are exercisable within
60 days.
(5) Except as otherwise indicated in the footnotes above, members of the
group have sole voting and investment power as to such shares.
INFORMATION ABOUT MANAGEMENT
Committees of the Board of Directors
The Board of Directors has an Audit committee but does not have
compensation or nominating committees. Compensation matters and nominations for
positions on the Board of Directors are passed upon by the Board as a whole. The
Board will consider review and consider shareholders' suggestions of nominees
for Director that are submitted in writing to the Board, at the address of the
Company's principal executive office, not less than 120 days in advance of the
date the Company's proxy statement is released to shareholders in connection
with the previous year's Annual Meeting of Shareholders. The defined purposes
and current membership of the Audit Committee is as follows.
Audit Committee. The Audit Committee, which is chaired by Dr. Strasser met
one time during 1997. The Audit Committee has responsibility for general
oversight of the Company's internal auditors, reviewing the Company's annual
audit plan with its auditors, considering questions and issues arising during
the course of the audit, oversight of the Company's financial reporting, and
inquiring into related matters such as the adequacy of internal controls. The
Audit Committee also has responsibility for making a recommendation to the Board
of Directors regarding the selection of the Company's independent auditors. In
addition to Dr. Strasser, Mr. Timothy S. Butler and Dr. Harold C. Friend serve
on the Audit Committee.
Board of Directors and Committee Meetings
The Board of Directors held nine meetings in fiscal 1997, and all of the
Directors attended at least 75% of the aggregate of (a) the total number of
meeting of the Board of Directors held during the period for which they served
as Director, and (b) the total number of meetings held by all Committees of the
Board of Directors on which they serve.
Compensation of Directors
At present the Company does not compensate any of its Directors for their
services to the Company as Directors, although it may do so in the future,
subject to applicable regulatory approval. The Company may reimburse its
Directors for their costs incurred for attending meetings of the Board of
Directors. The Company's Bank subsidiary compensates its Directors, some of whom
are Directors of the Company, by annual grants of 16,200 options to purchase
Bank Common Stock at par value of the Bank on the date of grant. Such options
are exercisable for a period of ten years from the date of grant.
Compensation of Management
The following table shows information concerning annual and long-term
compensation to certain Executive Officers for services to the Company for the
years ended December 31, 1997, 1996 and 1995. The table includes information on
the Company's Chairman and Chief Executive Officer, Philip C. Modder, and its
President and Chief Operating Officer, James L. Wilson, (collectively, the
"Named Executive Officers"). No other current Executive Officer earned more than
$100,000 in salary and bonus in 1997.
<TABLE>
<CAPTION>
Annual Compensation Long-Term
Compensation
Name and
Principal Position All Other
Compensation
Year Salary Other Annual Securities
Compensation Underlying LTIP
Options/ Payouts
SARs (#) ($)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Philip C. Modder, 1997 $175,000 (1) $17,000 (1) 48,807 -0- $8,408
Chairman & 1996 $127,000 (1) $17,000 (1) 19,619 -0- $8,408
President 1995 $149,000 (1) $17,000 (1) 18,692 -0- $8,408
James L. Wilson, 1997 $175,000 (1) $17,000 (1) 42,671 -0- $5,878
Vice Chairman & 1996 $103,000 (1) $17,000 (1) 14,714 -0- $5,878
Chief Executive 1995 $125,000 (1) $17,000 (1) 15,966 -0- $5,878
Officer
</TABLE>
(1) Includes automobile allowances in the amount of $10,800 per year for
each of Messrs. Modder and Wilson.
The following table shows information concerning options granted to Named
Executive Officers during the fiscal year ended December 31, 1997.
Option/SAR Grants in Last Fiscal Year
<TABLE>
<CAPTION>
Number of Percentage of
Securities Total
Name Underlying Options/SAR's Exercise or Base Expiration Date
Options/SAR's Granted to Price ($/Share)
Granted Employees in
Fiscal Year
<S> <C> <C> <C> <C>
Philip Modder 48,897 53% $1.80 06/30/2007
James Wilson 42,671 47% $1.80 06/30/2007
</TABLE>
In addition, as Directors of the Company's Bank subsidiary, each Messrs.
Modder and Wilson received 11,600 options to purchase shares of common stock of
the Bank. Such options are exercisable at 110% of the fair market value of the
Bank's shares on the date of grant and are exercisable for a period of ten years
from the date of grant.
The following table shows information concerning option
exercises and year-end option values for options held by the Named Executive
Officers.
<PAGE>
Aggregated Option/SAR Exercises in Last Fiscal Year
and
Fiscal Year-End Option SAR Values
- - ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number of Value of
Securities Unexercised
Underlying In-the-Money
Unexercised Options/SAR's
Shares Acquired Options/SAR's at at FY-End
Name on Exercise Value Realized 8-31-98 Exercisable/ Exercisable/
Unexercisable Unexercisable
<S> <C> <C> <C> <C>
Philip Modder - 0 - - 0 - 282,785/0 $ - 0 - (1)
James Wilson - 0 - - 0 - 209,180/0 $ - 0 - (1)
</TABLE>
(1) Average option exercise price was $.26 per share, the approximate book
value of the shares. There is no market for the Company's Common Stock, and any
shares issued upon exercise of the options would have been restricted under the
Securities Act.
Employment Agreements
Philip C. Modder and James L. Wilson have Employment Agreements with the Company
dated June 11, 1992 as amended June 30, 1997 (as so amended, the "Employment
Agreements"). The Employment Agreements provided that Modder would serve as the
Company's Chief Executive Officer and Chairman of the Board, and that Wilson
would serve as the Company's President, Senior Loan Officer, and Chief Operating
Officer. By Order of the Board of Directors of the Company on September 23, 1997
and subject to approval by bank regulators, which was granted with an effective
date of December 1, 1997, the positions of Messrs. Modder and Wilson were
changed to Chairman of the Board and President, and Vice Chairman of the Board
and Chief Executive Officer, respectively.
The Employment Agreements provide that Modder and Wilson shall each serve for a
five year term from June 11, 1997, except that the if the Company does not
deliver written notice to the respective executive at least six months prior to
the end of the term it shall automatically renew for an additional five year
term. Each Employment Agreement provides for the following compensation to the
executive: (i) the executive will be paid a base salary of $175,000 per year,
subject to annual increase by the greater of the change in the Consumer Price
Index ("CPI") or 5%; (ii) the executive will be paid a bonus equal to 2.5% of
the pre-tax net income of the Company; (iii) if the Company acquires the assets
of any existing financial institution, the executive shall receive a bonus equal
to 0.20% of the gross assets for each such transaction; (iv) the executive shall
during term of the Agreement receive semi-annual grants on July 1st and January
1st of stock options equal to 0.6% of the outstanding Class A Common Stock of
the Company exercisable at 110% of per share book value of such stock on the day
preceding the grant (the executives have agreed with the Company that options
granted on July 1, 1997 and January 1, 1998 are exercisable at the price at
which shares were offered in private placements on or about the date of grant --
$1.80 in the case of the July 1, 1997 options and $5.00 per share in the case of
the January 1, 1998 options); (v) if permitted by law and in accordance with
applicable federal and state regulations, loans equal to the exercise price of
the options granted at interest rates not greater than prime plus 1% with a term
of not less than 30 months; (vi) if any of the options is not an "incentive
stock option" under the Internal Revenue Code, reimbursement of any taxes the
executive is required to pay be reason thereof; (vii) disability insurance
coverage providing for benefits in the amount of 60% of the executives total
annual compensation subject to cost of living adjustments equal to the lesser of
the change in the CPR or 12% annum; (viii) a whole life insurance annuity policy
in the face amount of $1,750,000 plus reimbursement of any income taxes the
executive is required to pay as a result of payment of the premiums on such
insurance policy; (viii) family membership in two country clubs; (ix) an
automobile allowance of $900 per month adjusted annually in accordance with the
CPI plus sales taxes, insurance and operating costs of the auto; and (ix)
comprehensive medical and dental insurance.
Termination Payments
The Employment Agreements contain provisions for additional compensation to the
executive or his legal representatives in the event of termination, including:
(i) if an Employment Agreement terminates for any reason, all options provided
for thereunder become fully vested and exercisable for a period of ten years
from the date of such termination; (ii) if an Employment Agreement is terminated
for any reason other than death or permanent disability, the Company will pay
for the executive's comprehensive medical and dental insurance for two years
following the date of termination; (iii) in the event of the death or permanent
disability of the executive, the executive's annual compensation shall be paid
to him or his legal representatives for a period of 12 months following
termination; (iv) in the event of a Change of Control of the Company (defined to
include the acquisition of 20% or more of the combined voting power or the
Company's outstanding stock after the date of the agreement, a change in the
majority of the Board of Directors of the Company in connection with a business
combination, sale of assets or related transaction), if the executive may
terminates the agreement on 60 days written notice he shall receive a lump sum
payment of 200% of his total annual compensation for the preceding 12 months;
and (v) upon 60 days written notice before termination by the executive, the
executive shall receive a lump sum payment of 200% of his annual compensation
for the preceding 12 months together with continuation of employee benefits for
the periods described above.
CERTAIN TRANSACTIONS
On September 30, 1993, the Company received from Philip Modder, the Chairman of
the Company, and James Wilson, the President of the Company, $100,000 and
$50,000, respectively, in services and assistance in payment of organizational
expenses of the Company, and they received non interest bearing notes therefor
(the "Notes"). On June 30, 1997, in exchange for elimination of the Notes, the
Company sold 945,269 shares of Common Stock to Philip Modder, and 472,634 shares
of Common Stock to James Wilson, in each case at a price of $0.10579 per share
(110% of then book value per share), in exchange for the elimination of the
Notes. On the same date, Messrs. Modder and Wilson entered into an agreement
with the Board of Directors pursuant to which they eliminated obligations for
unpaid wages and benefits under the terms of their employment agreements
($78,563 in the case of Mr. Modder and $128,563 in the case of Mr. Wilson) in
exchange for the Company issuing Common Stock to them (742,632 shares and
1,215,266 shares, respectively) at the agreed upon value of $.10579 per share.
Messrs. Modder and Wilson subsequently agreed with the Company to revalue the
Shares of Common Stock issued on June 30, 1997 at $.60 per share and, as a
result, the Company rescinded the issue of 2,780,590 of the shares (1,390,085
each) made to them on June 30, 1997. As of December 31, 1997, the Company owed
$215,000 to Mr. Modder and $75,000 to Mr. Wilson for unpaid back wages and
benefits.
The Company currently owes $100,000 to a trust affiliated with John E. Butler,
who is the father of Timothy S. Butler and the uncle of R. David Butler, who are
Directors of the Company, pursuant to the terms of a note that bears interest at
the rate of 8% per annum payable quarterly (the "Butler Note"). The Butler Note
was issued on December 29, 1993 and matures every six months, when it is
automatically renewed for an additional six months unless the trust notifies the
Company of its intention to call the Note thirty days prior to such maturity
date. The next maturity date of the Butler Note is on June 30, 1998.
Section 16(a) Beneficial Ownership Reporting Compliance
Under Section 16 of the Securities and Exchange Act of 1934, as amended,
Directors and Executive Officers and certain other persons are required to
report their ownership of equity securities of the Company, and any changes in
that ownership, to the Securities and Exchange Commission and the Company. Based
solely upon a review of reports furnished to the Company by such persons on
Forms 3, 4, or 5 for the period ended December 31, 1997 (the "Section 16(a)
Reports") and information provided by each individual, the following persons
failed to file Form 3 Reports during 1997 concerning their status as Directors,
Officers and more than 10% shareholders of the Company: Philip C. Modder, James
L. Wilson, Timothy S. Butler, Eugene J. Strasser, Harold C. Friend, Robert D.
Butler, Jr., and Floyd Harper.
All of such persons have subsequently filed Form 3 Reports. None of such
persons failed to file any other Section 16(a) Reports during 1997.
SHAREHOLDER PROPOSALS
Shareholder proposals to be considered for inclusion in the Proxy Statement for
the next Annual Meeting must be submitted on a timely basis for the 1999 Annual
Meeting of Shareholders must be received by the Company at its principal
executive offices no later than December 1, 1998. Any such proposals, as well as
any questions related thereto, should be directed to the attention of Mr. Floyd
D. Harper, Vice President and Secretary.
INDEPENDENT AUDITORS
A representative of McGladrey & Pullen, LLP ("McGladrey & Pullen"), the
Company's independent auditors for 1997, is expected to attend the Annual
Meeting. The representative will be given an opportunity to make a statement if
he or she desires to do so, and will be available to respond to appropriate
questions. No member of McGladrey & Pullen has any past or present interest,
direct or indirect, in the Company or its subsidiary.
On September 24, 1996, the Board of Directors selected McGladrey & Pullen as the
Company's independent public accountants for 1996, 1997 and 1998 fiscal years.
Deloitte & Touche, LLP ("Deloitte") had been under a three year commitment with
the Company for the production of audited financial statements for the Bank for
the years 1993, 1994 and 1995, which commitment expired with the completion of
the 1995 audit. After a review of several competitive audit proposals, the Board
of Directors decided by unanimous vote at its September 24, 1996 Board Meeting
that McGladrey & Pullen would be the accountants for the Company for the next
three years, beginning with the 1996 audit.
Deloitte was the independent accounting firm which audited the financial
statements of the Bank for each fiscal year from 1993 through 1995. Deloitte's
reports on the Bank's financial statements for the past two fiscal year's did
not contain an adverse opinion or disclaimer of opinion, and was not qualified
or modified for uncertainty, audit scope, or accounting principles.
1) During the Company's two most recent fiscal years and subsequent interim
period preceding the date of the selection of McGladrey & Pullen, there were no
disagreements between the Company and Deloitte on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements, if not resolved to the satisfaction of the
Deloitte, would have caused it to make reference to the subject matter of the
disagreement in connection with its report.
2) During the Company's two most recent fiscal years and any subsequent
interim period preceding the date of the selection of McGladrey & Pullen, none
of the following events occurred:
(a) Deloitte advised the Company that the internal controls necessary for
the Bank to develop reliable financial statements did not exist;
(b) Deloitte having advised the Bank that information has come to its
attention that had led it to no longer be able to rely on management's
representations, or that made it unwilling to be associated with the financial
statements prepared by management.
(c)(1) Deloitte having advised the Bank of the need to expand significantly
the scope of its audit, or that information had come to its attention during the
such time period, that if further investigated might (i) materially impact the
fairness or reliability of either: a previously issued audit report or the
underlying financial statements; or the financial statements issued or to be
issued covering the fiscal periods subsequent to the date of the most recent
financial statements covered by an audit report (including information that may
prevent it from rendering an unqualified audit report on those financial
statements), or (ii) cause it to be unwilling to rely on management's
representations or be associated with the registrant's financial statements: and
(2) due to the failure to reappoint Deloitte as accountants for the Bank or for
any other reason, Deloitte did not so expand the scope or its audit or conduct
such further investigation; or
(d) (1) Deloitte having advised the Bank that information has come to its
attention and that it had concluded that the information materially impacts the
fairness or reliability of either (i) a previously issued audit report or the
underlying financial statements, or (ii) the financial statements issued or to
be issued covering the fiscal period(s) subsequent to the date of the most
recent financial statements covered by an audit report (including information
that unless resolved to Deloitte's satisfaction, would prevent it from rendering
an unqualified audit report on those financial statements: and (2) due to the
failure to reappoint Deloitte as accountants for the Bank or for any other
reason, the issue has not been resolved to its satisfaction.
During the Company's two most recent fiscal years and any interim period
prior to March 30, 1996, the Company (or someone acting on its behalf) did not
consult McGladrey & Pullen regarding either any matter that was either (i) the
subject of a disagreement as described in paragraph number "1" above, or (ii)
the subject of any event described in paragraph number "2" above.
OTHER MATTERS
Except for the matters set forth above, the Board knows of no other matters
which may be presented at the Annual Meeting of Shareholders, but if any other
matters properly come before the Annual Meeting, it is the intention of the
persons named in the accompanying form of proxy to vote such proxies in
accordance with their judgement in such matters. The Company's 1997 Annual
Report to Shareholders, although not a part of this Proxy Statement, is
enclosed.
A copy of the Company's Annual Report on Form 10-K for the fiscal year 1997 may
be obtained without charge by any shareholder of record by written request to
Floyd D. Harper, Vice President and Secretary at Southern Security Bank
Corporation, 3475 Sheridan Street, Hollywood, Florida 33021.
Dated: October 16, 1998
BY ORDER OF THE BOARD OF DIRECTORS
Floyd D. Harper, Vice President & Secretary
<PAGE>
SOUTHERN SECURITY BANK CORPORATION
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
OCTOBER 7, 1998
The undersigned shareholder(s) of Southern Security Bank Corporation hereby
appoints Timothy S. Butler and Eugene J. Strasser, M.D., or either of them (with
full power to act alone), as proxy or proxies with full power of substitution,
to vote all the shares of Common Stock of Southern Security Bank Corporation
(the "Company"), which the undersigned may be entitled to vote, as specified
herein, at the Annual Meeting of Shareholders of the Company to be held at
Southern Security Bank, 3475 Sheridan Street, Hollywood, Florida, at 4:00 P.M.
on October 27, 1998, and at any adjournment thereof, with all the powers the
undersigned would possess if personally present. Said proxies are authorized to
vote on the following matters.
1) Election of Directors Nominees are listed below
[ ] FOR the election of all [ ] WITHHOLD AUTHORITY
nominees listed below to vote for all
(except as marked to nominees listed below
the contrary below)
R. David Butler and Harold C. Friend, M.D. to serve as Group III Directors until
the Annual Meeting of Shareholders in 2001.
2) Said proxies are given discretion to vote upon the transaction of such other
business as may properly come before the meeting or any adjournment thereof.
The Proxy, when properly executed, will be noted in the manner directed herein
by the undersigned stockholder(s). Unless contrary direction is given, this
Proxy will be voted FOR the election of nominees listed in 1, and in accordance
with the discretion of the proxies on any other matters.
Please sign exactly as name appears above. When signing as attorneys, executors,
administrators, trustee or guardian, please give full title as such. Proxies
issued by a corporation should be signed with full corporate name by duly
authorized officer or officers. If a partnership, please sign the partnership
name by an authorized person. For joint tenants, each owner should sign.
- - --------------------------- -------------------------------------
Dated
-------------------------------------
(Signature of Stockholder[s]
PLEASE SIGN, DATE, AND RETURN PROXY
