SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. ___)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240-14a-11(c) or Sec. 240.14a-12
STATE OF FRANKLIN BANCSHARES, INC.
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(Name of Registrant as Specified In Its Charter)
Charles E. Allen, Jr.
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(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the Appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act
Rules 14a6(i)(4) and0-11.
1. Title of each class of securities to which transaction applies:
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2. Aggregate number of securities to which transaction applies:
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3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:[1]
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4. Proposed maximum aggregate value of transaction:
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5. Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
Was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid::------------------
2) Form, Schedule or Registration Statement No:------------------
3) Filing Party::------------------
4) Date Filed::--------------------
<PAGE>
STATE OF FRANKLIN BANCSHARES, INC.
1907 NORTH ROAN STREET
JOHNSON CITY, TENNESSEE 37604
April 4, 2000
To the Shareholders of
State of Franklin Bancshares, Inc.
You are cordially invited to attend the annual meeting of shareholders of
State of Franklin Bancshares, Inc., which will be held at 1907 North Roan
Street, Johnson City, Tennessee, on Tuesday, April 25, 2000, at 7:00 p.m.,
Eastern Time.
At the meeting, you will be asked to:
- elect three directors to serve until the 2003 annual meeting of
shareholders;
- ratify the appointment of Baylor & Backus as State of Franklin's
independent accountants and auditors for 2000; and
- transact other business that properly comes before the meeting or any
adjournment of the meeting.
We have enclosed a notice of the annual meeting of shareholders, a proxy
statement, and a form of proxy. The matters listed in the notice of annual
meeting are more fully described in the proxy statement.
It is important that your shares are represented and voted at the meeting,
regardless of the size of your holdings. Accordingly, we would appreciate your
completing the enclosed form of proxy whether or not you plan to attend the
meeting. If you are present at the meeting and wish to vote your shares
personally, your form of proxy can be revoked upon your request prior to
balloting. If you wish to personally vote at the meeting, but your shares are
held in the name of a broker, trust, bank or other nominee, you should bring
with you a form of proxy or letter from the broker, trustee, bank or nominee
confirming your beneficial ownership of the shares.
We urge you to return your form of proxy by mailing it in the enclosed
postage-paid envelope to be received no later than 5:00 p.m. on April 24, 2000.
Upon request, we will provide to you, without charge, a copy of our annual
report on Form 10-KSB for the year ended December 31, 1999 as filed with the
SEC. Requests should be directed to Becky Mominee, Secretary, State of Franklin
Bancshares, Inc., 1907 North Roan Street, Johnson City, Tennessee 37604, (423)
926-3600.
Sincerely yours,
Charles E. Allen, Jr. Randal R. Greene
Chairman of the Board President
<PAGE>
STATE OF FRANKLIN BANCSHARES, INC.
1907 NORTH ROAN STREET
JOHNSON CITY, TENNESSEE 37604
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 25, 2000
The regular annual meeting of shareholders of State of Franklin Bancshares,
Inc. will be held at 1907 North Roan Street, Johnson City, Tennessee, on
Tuesday, April 25, 2000, at 7:00 p.m., Eastern Time, for the following purposes:
1. ELECTION OF DIRECTORS. To elect three directors to serve until the 2003
annual meeting of shareholders or until their successors have been duly
elected and qualified.
2. RATIFICATION OF AUDITORS. To ratify the appointment of Baylor & Backus
as State of Franklin's independent accountants and auditors for 2000.
3. OTHER BUSINESS. To transact such other business as may properly come
before the meeting or any adjournment of the meeting.
Shareholders of record at the close of business on March 15, 2000, are
Entitled to notice of and to vote on all matters presented at the Annual
Meeting of Shareholders. On that day, 1,345,465 shares of common stock were
outstanding. Each share entitles the holder to one vote.
By Order of the Board of Directors
Becky Mominee
Secretary
April 4, 2000
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| YOUR VOTE IS IMPORTANT |
| |
| WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING AND REGARDLESS OF |
| ----------------------------------------------------------------- |
| THE NUMBER OF SHARES YOU OWN, PLEASE MARK, SIGN, DATE AND RETURN |
| ---------------------------------------------------------------- |
| THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE |
| YOU MAY NEVERTHELESS VOTE IN PERSON IF YOU ATTEND THE ANNUAL MEETING |
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<PAGE>
STATE OF FRANKLIN BANCSHARES, INC.
1907 NORTH ROAN STREET
JOHNSON CITY, TENNESSEE 37604
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
Your vote is very important. For this reason, the board of directors is
requesting that, if you are not able to attend the annual meeting of
shareholders, you allow your common stock to be represented at the meeting by
the proxies named in the enclosed proxy card. This proxy statement and the form
of proxy are being sent to you in connection with this request and are being
mailed to all shareholders beginning on April 4, 2000.
INFORMATION ABOUT THE ANNUAL MEETING
WHEN IS THE ANNUAL MEETING?
Tuesday, April 25, 2000, 7:00 p.m. Eastern Time.
WHERE WILL THE ANNUAL MEETING BE HELD?
1907 North Roan Street, Johnson City, Tennessee.
WHAT ITEMS WILL BE VOTED UPON AT THE ANNUAL MEETING?
You will be voting upon the following matters:
1. ELECTION OF DIRECTORS. To elect three directors to serve until the
2003 annual meeting of shareholders or until their successors have
been duly elected and qualified.
2. RATIFICATION OF AUDITORS. To ratify the appointment of Baylor &
Backus as State of Franklin's independent accountants and auditors
for 2000.
3. OTHER BUSINESS. To transact such other business as may properly
come before the meeting or any adjournment of the meeting.
WHO CAN VOTE?
You are entitled to vote your common stock if our records show that you
held your shares as of the close of business on the record date, March 15, 2000.
Each shareholder is entitled to one vote for each share of common stock held on
that date. On March 15, 2000, there were 1,345,465 shares of common stock
outstanding and entitled to vote.
HOW DO I VOTE BY PROXY?
If you sign, date and return your signed proxy card before the annual
meeting, we will vote your shares as you direct. For the election of directors,
you may vote for (1) all of the nominees, (2) none of the nominees, or (3) all
of the nominees except those you designate. For the ratification of State of
Franklin's auditors, you may vote "FOR" or "AGAINST" or you may "ABSTAIN" from
voting.
<PAGE>
If you return your signed proxy card but do not specify how you want to
vote your shares, we will vote them
- "FOR" the election of all of our nominees for director;
- "FOR" the ratification of Baylor and Backus as our independent
auditors.
The board of directors knows of no other business to be presented at the
annual meeting. If any matters other than those set forth above are properly
brought before the annual meeting, the individuals named in your proxy card may
vote your shares in accordance with their best judgment.
HOW DO I CHANGE OR REVOKE MY PROXY?
You can change or revoke your proxy at any time before it is voted at the
annual meeting by:
(1) submitting another proxy with a more recent date than that of the
proxy first given;
(2) attending the annual meeting and voting in person; or
(3) sending written notice of revocation to our corporate secretary,
Becky Mominee.
HOW MANY VOTES ARE REQUIRED?
If a quorum is present at the annual meeting,
- the director nominees will be elected by a plurality of the votes
cast in person or by proxy at the meeting; and
- the approval of independent auditors and all other matters submitted
to the shareholders will require the affirmative vote of a majority
of the shares of common stock present or represented by proxy
at the meeting.
WHAT CONSTITUTES A "QUORUM" FOR THE MEETING?
A majority of the outstanding shares, present or represented by proxy,
constitutes a quorum. A quorum is necessary to conduct business at the annual
meeting. You are part of the quorum if you have voted by proxy. Abstentions,
broker non-votes and votes withheld from director nominees count as "shares
present" at the meeting for purposes of determining a quorum. However,
abstentions and broker non-votes do not count in the voting results. A broker
non-vote occurs when a broker or other nominee who holds shares for another does
not vote on a particular item because the nominee does not have discretionary
authority for that item and has not received instructions from the owner of the
shares.
WHO PAYS FOR THE SOLICITATION OF PROXIES?
We will pay the cost of preparing, printing and mailing material in
connection with this solicitation of proxies. In addition to solicitation by
mail, regular employees of State of Franklin and paid solicitors may make
solicitations personally and by telephone or otherwise. We will, upon request,
reimburse brokerage firms, banks and others for their reasonable out-of-pocket
expenses in forwarding proxy material to beneficial owners of stock or otherwise
in connection with this solicitation of proxies. We have retained the Illinois
Stock Transfer Company to assist in the solicitation for a fee of $4,375 plus
reasonable out-of-pocket expenses.
<PAGE>
WHEN ARE THE 2000 SHAREHOLDER PROPOSALS DUE?
Proposals by shareholders to be considered for inclusion in the proxy
materials solicited by the directors for the annual meeting in 2001 must be
received by the Corporate Secretary, 1907 North Roan Street, Johnson City,
Tennessee 37604, no later than DECEMBER 20, 2000. The use of certified mail,
return receipt requested, is advised. To be eligible for inclusion, a proposal
must also comply with Rule 14a-8 and all other applicable provisions of
Regulation 14A under the Securities Exchange Act of 1934.
<PAGE>
THE PROPOSALS
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PROPOSAL 1 - ELECTION OF DIRECTORS
The Board has nominated the following three persons to serve as directors:
Charles E. Allen, Sr., M.D., Donald R. Jeanes and Richard S. Venable. We do not
anticipate that any of these nominees will be unavailable for election but, if
such a situation arises, the proxy will be voted in accordance with the best
judgment of the named proxies unless you have directed otherwise. The remaining
members of the Board listed below will continue as members of the Board until
their respective terms expire, as indicated below.
INFORMATION ABOUT THE THREE INDIVIDUALS NOMINATED AS DIRECTORS AND THE
REMAINING MEMBERS OF THE BOARD IS PROVIDED BELOW. SHARES OF COMMON STOCK
REPRESENTED BY PROXY CARDS RETURNED TO US WILL BE VOTED FOR THE NOMINEES LISTED
BELOW UNLESS YOU SPECIFY OTHERWISE.
<TABLE>
<CAPTION>
NOMINEES FOR ELECTION
(TERMS EXPIRING 2003)
DIRECTOR, YEAR FIRST PRINCIPAL OCCUPATION,
ELECTED AS DIRECTOR AGE BUSINESS AND DIRECTORSHIPS
- --------------------------- --- ----------------------------------
<S> <C> <C>
Charles E. Allen, Sr., M.D. 69 Physician
1996
Donald R. Jeanes. . . . . . 54 President of Milligan College
1996
Richard S. Venable. . . . . 55 Owner and President of R.S.V. Inc.
1996
</TABLE>
THE BOARD OF DIRECTORS OF STATE OF FRANKLIN RECOMMENDS A VOTE "FOR" THE
ELECTION OF THE NOMINEES LISTED ABOVE.
<TABLE>
<CAPTION>
INCUMBENT DIRECTORS
(TERMS EXPIRING 2002)
DIRECTOR, YEAR FIRST PRINCIPAL OCCUPATION,
ELECTED AS DIRECTOR AGE BUSINESS AND DIRECTORSHIPS
- ------------------------- --- -------------------------------------------------------------
<S> <C> <C>
Randal R. Greene. . . . . 40 President of State of Franklin; President and Chief Executive
1996 Officer of the Savings Bank
Kenneth E. Cutshall, M.D. 39 Physician
1996
Cameron E. Perry. . . . . 70 Banker, retired
1996
Henry J. Williams, M.D. . 63 Physician
1996
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
INCUMBENT DIRECTORS
(TERMS EXPIRING 2001)
DIRECTOR, YEAR FIRST PRINCIPAL OCCUPATION,
ELECTED AS DIRECTOR AGE BUSINESS AND DIRECTORSHIPS
- ----------------------- --- -----------------------------------------------------------
<S> <C> <C>
Charles E. Allen, Jr. . 39 Chairman of the Board of State of Franklin; Chairman of the
1996 Board and Chief Financial Officer of the Savings Bank
Stephen K. Gross 53 Chief Financial Officer and owner of Microporous Products,
1996 LP
Verrill M. Norwood, Jr. 68 Environmental consultant
1996
Vance W. Cheek. . . . . 76 Banker, retired
1996
</TABLE>
These persons have served as directors of the State of Franklin Savings
Bank since 1996 and as directors of State of Franklin since our formation in May
1998. Charles E. Allen, Sr, M.D., is the father of Charles E. Allen, Jr.
Verrill M. Norwood, Jr., is the father-in-law of Randal R. Greene. No director
of State of Franklin is a director or executive officer of another bank holding
company, bank, savings and loan association, or credit union. The principal
occupations and employments of the persons listed above are for the past five
years except as described below:
CHARLES E. ALLEN, JR., has served as Chairman of the Board and Chief
Financial Officer of the Savings Bank since its inception in February 1996 and
Chairman of the Board of State of Franklin since our organization in May 1998.
He is a certified public accountant and a certified financial planner. He
served two terms in the Tennessee General Assembly from 1990-1994. Previously
he was an investment broker with J.C. Bradford & Co., until his resignation in
August 1995 to form the Savings Bank. He is also president of Charles E. Allen
Co. Inc. which manages and is owner/partner in six Stowaway Self Service Storage
facilities in East Tennessee and western North Carolina.
RANDAL R. GREENE has served as President and Chief Executive Officer of the
Savings Bank since its inception in February 1996 and President of State of
Franklin since our organization in May 1998. Previously, Mr. Greene was a
senior vice president of First American National Bank serving as division
manager of the corporate division responsible for the Johnson City, Kingsport
and Bristol markets.
ELECTION OF DIRECTORS REQUIRES THE AFFIRMATIVE VOTE OF THE HOLDERS OF A
PLURALITY OF THE SHARES OF COMMON STOCK REPRESENTED AT THE ANNUAL MEETING.
<PAGE>
INFORMATION ABOUT THE BOARD OF DIRECTORS
ROLE OF THE BOARD
Pursuant to Tennessee law, our business, property and affairs are managed
under the direction of our board of directors. The Board has responsibility for
establishing broad corporate policies and for the overall performance and
direction of State of Franklin, but is not involved in day-to-day operations.
Members of the Board keep informed of our business by participating in Board and
committee meetings, by reviewing analyses and reports sent to them regularly,
and through discussions with our executive officers.
BOARD STRUCTURE
State of Franklin's bylaws provide that the board of directors shall
consist of no fewer than five nor more than 25 members. The Board is currently
composed of 11 members by Board resolution. The directors are divided into
three classes, each of which is as nearly equal in number as possible. The
directors in each class hold office for staggered terms of three years each.
Staggered terms make it more difficult for shareholders, including those holding
a majority of the common stock of State of Franklin, to force an immediate
change in the composition of a majority of the board of directors. Since the
terms of only one-third of the incumbent directors expire each year, two annual
meetings of shareholders would be required to change a majority of the directors
of State of Franklin, provided that no directors resigned, were removed, or died
during their terms of office and the vacancies created thereby were not filled
by an affirmative vote of majority of the board of directors.
1999 BOARD MEETINGS
During 1999 the board of directors of State of Franklin held nine meetings.
The directors of State of Franklin also serve as directors of the Savings Bank.
The board of directors of the Savings Bank held twelve meetings in 1999. No
director attended less than 75% of the meetings held by State of Franklin or the
Savings Bank during 1999.
BOARD COMMITTEES
The Board has three committees: the Audit Committee, the Compensation
Committee and the Nominating Committee.
The Audit Committee, consisting of directors Perry, Gross, Jeanes and
Allen, Sr., is responsible for the review and evaluation of State of Franklin's
internal controls and accounting procedures. It also periodically reviews audit
reports with State of Franklin's independent auditors and recommends the annual
appointment of auditors.
State of Franklin's Compensation Committee is composed of directors
Venable, Gross, Jeanes, Cutshall and Perry. This Committee establishes salary
and compensation guidelines for State of Franklin's employees. During 1999 the
Compensation Committee held one meeting.
The entire Board acts as Nominating Committee for the nomination of members
of the board of directors. The board of directors met one times in its capacity
as the Nominating Committee during 1999.
DIRECTOR COMPENSATION
Each director received a fee of $300 for each Savings Bank Board meeting he
attended during 1999 as well as a $100 fee for each Savings Bank Executive
Committee meeting he attended.
<PAGE>
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PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The board of directors has confirmed the appointment by the Audit Committee
of Baylor & Backus as State of Franklin's independent accountants and auditors
for 2000. Baylor & Backus has served as independent accountants and auditors of
State of Franklin for the year ended December 31, 1999. Representatives of the
firm will be present at the Annual Meeting, will have an opportunity to make a
statement if they so desire, and are expected to be available to respond to
appropriate questions by shareholders.
THE AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE OUTSTANDING SHARES
OF COMMON STOCK PRESENT OR REPRESENTED AT THE ANNUAL MEETING, IF A QUORUM
EXISTS, ENTITLED TO VOTE AT THE ANNUAL MEETING IS REQUIRED TO RATIFY THE
APPOINTMENT OF BAYLOR & BACKUS AS STATE OF FRANKLIN'S INDEPENDENT ACCOUNTANTS
AND AUDITORS FOR 2000.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" RATIFICATION OF THE
APPOINTMENT OF BAYLOR & BACKUS AS STATE OF FRANKLIN'S INDEPENDENT ACCOUNTANTS
AND AUDITORS FOR 2000.
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<PAGE>
<TABLE>
<CAPTION>
STATE OF FRANKLIN STOCK OWNERSHIP
The following table sets forth certain information regarding the ownership of the common
stock as of March 1, 2000, for (i) each person who owns more than 5% of the common stock, (ii)
each director and the executive officers who are listed in the executive compensation tables in
this proxy statement, and (iii) all executive officers and directors as a group.
AMOUNT AND NATURE
OF BENEFICIAL OWNERSHIP PERCENT
NAME OF BENEFICIAL OWNER (NUMBER OF SHARES) OF CLASS(1)
- ----------------------------------------------------------- ------------------------ -----------
<S> <C> <C>
Charles E. Allen, Jr.(2)(3) . . . . . . . . . . . . . . . . 128,867 9.7%
Charles E. Allen, Sr., M.D.(4). . . . . . . . . . . . . . . 27,777 2.1
Vance W. Cheek(4) . . . . . . . . . . . . . . . . . . . . . 10,277 *
Kenneth E. Cutshall, M.D.(4). . . . . . . . . . . . . . . . 23,477 1.8
Randal R. Greene(2)(3). . . . . . . . . . . . . . . . . . . 102,655 7.7
Stephen K. Gross(4) . . . . . . . . . . . . . . . . . . . . 27,096 2.0
Donald R. Jeanes(4) . . . . . . . . . . . . . . . . . . . . 6,777 *
Verrill M. Norwood, Jr.(4). . . . . . . . . . . . . . . . . 37,777 2.9
Cameron E. Perry(4) . . . . . . . . . . . . . . . . . . . . 12,777 *
Henry J. Williams, Jr., M.D.(4).. . . . . . . . . . . . . . 58,547 4.4
Richard S. Venable(4) . . . . . . . . . . . . . . . . . . . 13,177 *
Directors and executive officers as a group (11 persons)(5) 393,460 29.7
<FN>
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* Less than 1%
(1) Unless otherwise indicated, beneficial ownership consists of sole voting and investing
power based on 1,326,376 shares issued and outstanding on March 1, 2000. Options to purchase
69,445 shares are exercisable or become exercisable within 60 days of March 1, 2000. These shares
issuable under options are deemed to be outstanding for the purpose of computing the percentage of
outstanding shares owned by each person to whom a portion of these options relate but are not
deemed to be outstanding for the purpose of computing the percentage owned by any other person.
(2) Includes 22,226 shares issuable within the next 60 days upon the exercise of options.
(3) Includes 55,744 shares held by the Employee Stock Ownership Plan for which Mr. Allen and
Mr. Greene serve as co-trustees.
(4) Includes 2,777 shares issuable within the next 60 days upon the exercise of options.
(5) Includes 69,445 shares issuable upon the exercise of options granted under the Stock
Incentive Plan and 55,744 shares held by the Employee Stock Ownership Plan.
Messrs. Charles E. Allen, Jr. and Randal R. Greene serve as executive officers and
directors of State of Franklin.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXECUTIVE COMPENSATION
The following table sets forth the aggregate cash compensation paid by State of Franklin to the
Chairman and the President of State of Franklin. No other executive officer of State of Franklin
received cash compensation in excess of $100,000 (determined as of the end of 1999) for the years ended
December 31, 1999, 1998 and 1997.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG TERM
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COMPENSATION
SECURITIES
UNDERLYING
NAME AND POSITION YEAR SALARY ($) BONUS ($) OPTIONS/SARS(#)
- --------------------- ---- -------------------- ------------- ----------------
<S> <C> <C> <C> <C>
Charles E. Allen, Jr. 1999 130,000 17,500 --
Chairman of the Board 1998 114,167 15,000 25,064
1997 105,000 -- 30,500
Randal R. Greene 1999 130,000 17,500 --
President 1998 114,167 15,000 25,064
1997 105,000 -- 30,500
</TABLE>
<TABLE>
<CAPTION>
OPTION GRANTS
There were no grants of stock options to the executive officers during 1999.
The following table discloses information regarding stock options held at the end of or exercised in fiscal year 1999
for each of the executive officers as of December 31, 1999.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
SHARES SECURITIES UNDERLYING VALUE OF UNEXERCISED
ACQUIRED ON VALUE UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
NAME EXERCISE(1) REALIZED(1) AT DECEMBER 31, 1999 AT DECEMBER 31, 1999 (2)
- --------------------- ----------- ----------- -------------------------- --------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Charles E. Allen, Jr. --- --- 22,226 33,338 $ 71,345 $ 107,014
Randal R. Greene --- --- 22,226 33,338 $ 71,345 $ 107,014
<FN>
_________________
(1) As of December 31, 1999, no options have been exercised by the executive officers under the Stock Incentive Plan.
(2) Based on State of Franklin's offering of shares of our common stock to the public during 1999 at a price of $13.50
per share.
</TABLE>
<PAGE>
REPORT ON EXECUTIVE COMPENSATION OF THE
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The Compensation Committee of the board of directors is comprised of five
directors who are not employees of State of Franklin. The Committee is
responsible for establishing and administering State of Franklin's executive
compensation programs, as well as determining the salaries, compensation and
benefits of the President and CEO and the Chairman and CFO.
This report of the Compensation Committee describes the components of State
of Franklin's executive officer compensation programs and describes the basis
upon which compensation is awarded to the executive officers of State of
Franklin.
This Compensation Committee report shall not be deemed incorporated by
reference by any general statement incorporating by reference this Proxy
Statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent that State of Franklin
specifically incorporates this information by reference, and shall not otherwise
be deemed filed under these Acts.
Compensation Philosophy and Structure
The Compensation Committee establishes and periodically reviews the
compensation for the executive officers. When setting salaries and bonuses, the
Committee considers profitability of State of Franklin, peer compensation and
the officers' effectiveness in meeting the goals established by the board of
directors.
COMPENSATION COMMITTEE
Richard S. Venable Stephen K. Gross
Donald R. Jeanes Kenneth E. Cutshall
Cameron E. Perry
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The federal securities laws require State of Franklin's directors and
executive officers, and persons who beneficially own more than 10% of a
registered class of State of Franklin's equity securities, to file with the SEC
initial reports of ownership and reports of changes in ownership of any
securities of State of Franklin. To State of Franklin's knowledge, based solely
on review of the copies of these reports furnished to State of Franklin and
representations by
reporting persons, all of State of Franklin's officers, directors and greater
than 10% beneficial owners made all filings required in a timely manner.
TRANSACTIONS WITH EXECUTIVE OFFICERS, DIRECTORS AND OTHERS
State of Franklin has had and expects to have in the future banking and
other business transactions in the ordinary course of our banking business with
directors, officers, and 10% beneficial owners of State of Franklin and their
affiliates, including members of their families, or corporations, partnerships,
or other organizations in which the officers or directors have a controlling
interest, on substantially the same terms (including price, or interest rates
and collateral) as those prevailing at the time for comparable transactions with
unrelated parties. Any such banking transactions will not involve more than the
normal risk of collectibility nor present other unfavorable features to State of
Franklin or the Savings Bank.
The Savings Bank leases office space from a partnership, Allen and Allen.
Charles E. Allen, Jr., the Chairman of the Board of State of Franklin and
Charles E. Allen, Sr., M.D., a director of State of Franklin, are principals in
Allen and Allen. The 2,625 square foot building houses the Savings Bank's
Browns Mill Road branch. Rent for the first three years of the of the contract
is $13.41 per square foot or $35,190 annually. This amount includes taxes,
insurance and maintenance.
<PAGE>
OTHER MATTERS
The board of directors, at the time of the preparation of this Proxy
Statement, knows of no business to come before the Annual Meeting other than
that referred to herein. If any other business should come before the Annual
Meeting, the persons named in the enclosed Proxy will have discretionary
authority to vote all proxies in accordance with their best judgment.
UPON THE WRITTEN REQUEST OF ANY RECORD HOLDER OR BENEFICIAL OWNER OF COMMON
STOCK ENTITLED TO VOTE AT THE ANNUAL MEETING, STATE OF FRANKLIN, WITHOUT CHARGE,
WILL PROVIDE A COPY OF OUR ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED
DECEMBER 31, 1999 AS FILED WITH THE SEC. REQUESTS SHOULD BE DIRECTED TO BECKY
MOMINEE, SECRETARY, STATE OF FRANKLIN BANCSHARES, INC., 1907 NORTH ROAN STREET,
JOHNSON CITY, TENNESSEE 37604, TELEPHONE (423) 926-3600.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Becky Mominee
Secretary
Johnson City, Tennessee
April 4, 2000
<PAGE>
STATE OF FRANKLIN BANCSHARES, INC.
1907 North Roan Street
Johnson City, Tennessee 37604
Please complete both sides of the Proxy Card,
detach and return in the enclosed postage-prepaid envelope.
DETACH PROXY CARD HERE
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THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE ANNUAL
MEETING OF SHAREHOLDERS
The undersigned hereby acknowledges receipt of the Notice of the Annual Meeting
and the related Proxy Statement.
Dated
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(PLEASE SIGN HERE)
Shareholder should sign here exactly as shown on the label affixed hereto.
Administrator, Trustee, or Guardian, please give full title. If more than one
Trustee, all should sign. All Joint Owners should sign.
DETACH ATTENDANCE CARD HERE AND MAIL WITH PROXY CARD
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STATE OF FRANKLIN BANCSHARES, INC.
If you plan to personally attend the Annual Meeting of Shareholders, please
check the box below and list names of attendees on reverse side.
Return this stub in the enclosed envelope with your completed proxy card.
I do plan to attend ---
the 2000 meeting | |
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NAMES OF PERSONS ATTENDING
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Proxy State of Franklin Bancshare, Inc.
The undersigned appoints each of Charles E. Allen, Jr., Randal R. Greene and
Becky Mominee, or any of them, with full power of substitution and revocation as
Proxy to vote all shares of stock standing in my name on the books of State of
Franklin Bancshares, Inc. (the "Company") at the close of business on March 15,
2000, which the undersigned would be entitled to vote if personally present at
the Annual Meeting of Shareholders of the Company to be held at 1907 North Roan
Street, Johnson City, Tennessee, on April 25, 2000, at 7:00 p.m., Eastern Time,
and at any and all adjournments, upon the matters set forth in the Notice of the
meeting. The Proxy is further authorized to vote in his or her discretion as to
any other matters which may come before the meeting. At the time of preparation
of the Proxy Statement, the Board of Directors knows of no business to come
before the meeting other than that referred to in the Proxy Statement.
THE SHARES COVERED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
INSTRUCTIONS GIVEN BELOW AND WHEN NO INSTRUCTIONS ARE GIVEN WILL BE VOTED FOR
THE PROPOSALS DESCRIBED IN THE ACCOMPANYING NOTICE OF ANNUAL MEETING AND PROXY
STATEMENT AND ON THIS PROXY.
1. Election of three directors to serve a three-year term or until
their succesors have been duly elected and qualified.
--- FOR all nominees listed below (except as indicated to the
| | contrary below).
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--- WITHHOLD AUTHORITY to vote for all nominees listed below.
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Charles E. Allen, Sr., M.D., Donald R. Jeanes, Richard S. Venable
INSTRUCTIONS: To withhold authority to vote for any individual
nominee, write such nominee's name in the space provided
below.
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2. Ratification of the appointment of Baylor & Backus as the Company's
independent accountants and auditors for 2000.
For Against Abstain
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[Continued and to be signed on other side]
