SOUTHWEST GEORGIA FINANCIAL CORPORATION
March 15, 1998
Dear Fellow Shareholder:
The Annual Meeting of the Shareholders of Southwest Georgia
Financial Corporation will be held on Tuesday, April 28, 1998 in
Wright Auditorium at the Colquitt County Arts Center, Moultrie,
Georgia at 4:30 P.M. for the purposes set forth in the accompanying
Notice of Annual Meeting of Shareholders and Proxy Statement.
Again this year, we will have a special drawing for share-
holders who attend the meeting. We will give away four $500.00
savings bonds - you must be present to win and you must be a
shareholder of Southwest Georgia Bank and Southwest Georgia Financial
Corporation (Directors, Officers, and Staff of Southwest Georgia Bank
and Southwest Georgia Financial Corporation and their immediate families
are not eligible to participate in the drawing).*
In order to ensure that your shares are voted at the meeting,
please complete, date, sign, and return the Proxy in the enclosed
postage-paid envelope at your earliest convenience. Every
shareholder's vote is important, no matter how many shares you own.
We encourage you to attend this Annual Meeting of the
Shareholders and join us in the gallery immediately following the
meeting for refreshments. We look forward to your continued support
and another good year in 1998.
Very truly yours,
JOHN H. CLARK
Vice Chairman and Chief Executive Officer
* Immediate family is considered to be husband, wife,
and children living at home.
<PAGE>
SOUTHWEST GEORGIA FINANCIAL CORPORATION
P.O. Box 3488
201 First Street, S.E.
Moultrie, Georgia 31768
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on April 28, 1998
The annual meeting of shareholders of Southwest Georgia Financial Corporation
("the Company") will be held on Tuesday, April 28, 1998, at 4:30 p.m. at the
Colquitt County Arts Center, 401 Seventh Avenue, S.W., Moultrie, Georgia, for
the purposes of considering and voting upon:
1. The election of twelve directors to constitute the
Board of Directors to serve until the next annual meeting and
until their successors are elected and qualified; and
2. Such other matters as may properly come before the
meeting or any adjournment thereof.
Only shareholders of record at the close of business on March 9, 1998, will be
entitled to notice of and to vote at the meeting or any adjournment thereof.
A Proxy Statement and a Proxy solicited by the Board of Directors are enclosed
herewith. Please sign, date and return the Proxy promptly in the enclosed
business reply envelope. If you attend the meeting you may, if you wish,
withdraw your Proxy and vote in person.
Also enclosed is the Company's 1997 Annual Report to Shareholders, which
contains financial data and other information about the Company.
By Order of the Board of Directors,
JOHN H. CLARK
Vice Chairman and Chief Executive Officer
March 27, 1998
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY PROMPTLY IN
THE ENCLOSED SELF-ADDRESSED ENVELOPE.
<PAGE>
SOUTHWEST GEORGIA FINANCIAL CORPORATION
P.O. Box 3488
201 First Street, S.E.
Moultrie, Georgia 31768
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
Proxies by the Board of Directors of Southwest Georgia Financial Corporation
(the "Company") for use at the Annual Meeting of Shareholders of the Company
to be held on April 28, 1998, and any adjournment thereof, for the purposes
set forth in the accompanying notice of the meeting. The expenses of this
solicitation, including the cost of preparing and mailing this Proxy Statement,
will be paid by the Company. Copies of solicitation materials may be furnished
to banks, brokerage houses, and other custodians, nominees, and fiduciaries for
forwarding to beneficial owners of shares of the Company's Common Stock, and
normal handling charges may be paid for such forwarding service. In addition
to solicitations by mail, directors and regular employees of the Company may
solicit Proxies in person or by telephone. It is anticipated that this Proxy
Statement and the accompanying Proxy will first be mailed to shareholders
on March 27, 1998.
The record of shareholders entitled to vote at the Annual Meeting of
Shareholders was taken as of the close of business on March 9, 1998. On that
date, the Company had outstanding and entitled to vote 2,563,856 shares of
Common Stock, par value $1.00 per share.
Any Proxy given pursuant to this solicitation may be revoked by any shareholder
who attends the meeting and gives oral notice of his or her election to vote in
person, without compliance with any other formalities. In addition, any Proxy
given pursuant to this solicitation may be revoked prior to the meeting by
delivering a signed writing revoking it or a duly executed Proxy bearing a
later date to the Secretary of the Company at Southwest Georgia Financial
Corporation, P.O. Box 3488, Moultrie, Georgia 31776-3488. If the Proxy is
properly completed and returned by the shareholder and is not revoked, it will
be voted at the meeting in the manner specified thereon. If the Proxy is
returned but no choice is specified thereon, it will be voted for all the
persons named below under the caption "Information about Nominees for Director".
The Company will furnish without charge a copy of its Annual Report on Form
10-K filed with the Securities and Exchange Commission for the fiscal year ended
December 31, 1997, including financial statements and schedules, to any record
or any beneficial owner of its Common Stock as of March 9, 1998, who requests a
copy of such report. Any request for the Form 10-K report should be in writing
addressed to:
Mr. George R. Kirkland
Southwest Georgia Financial Corporation
P.O. Box 3488
Moultrie, Georgia 31776-3488
If the person requesting the report was not a shareholder of record on
March 9, 1998, the request must include a representation that the person was a
beneficial owner of Common Stock on that date. Copies of any exhibits to the
Form 10-K will also be furnished on request and upon the payment of the
Company's expense in furnishing the exhibits.
<PAGE>
VOTING SECURITIES AND PRINCIPAL HOLDERS
The following table sets forth as of March 1, 1998, beneficial ownership of the
Company's Common Stock by each "person" (as that term is defined by the
Securities and Exchange Commission) known by the Company to be the beneficial
owner of more than 5% of the Company's voting securities and by all directors
and officers of the Company as a group.
<TABLE>
<CAPTION>
Name And Address of Number of Shares
Beneficial Owner Owned Beneficially Percent of Class
<S> <C> <C>
Leo T. Barber, Jr. 480,019 (1) 18.72%
617 Third Street, S.W.
Moultrie, Georgia 31768
Albert W. Barber 461,062 (1,2,3) 17.98%
118 Dogwood Circle
P.O. Box 627
Moultrie, Georgia 31768
The Employee Stock Ownership Plan 469,997 18.33%
and Trust of Southwest Georgia
Financial Corporation
201 First Street, S.E.
Moultrie, Georgia 31768
All Directors and Officers as a Group 1,060,943 41.38%
(28 persons)
</TABLE>
(1) Includes 259,650 shares held by the Louise W. Barber Trust, of which
Leo T. Barber, Jr., and Albert W. Barber are joint trustees. Also includes
124,840 shares held by the L.T.B., Sr., Trust of which Leo T. Barber, Jr.,
and Albert W. Barber serve as co-trustees.
(2) Includes 2,600 shares held in the name of Mr. Albert W. Barber's wife, as
to which he disclaims beneficial ownership.
(3) Includes 2,000 shares held by the Paul B. Fontenot Trust and 2,000 shares
held by the Richard T. Fontenot Trust, of which Albert W. Barber serves as
trustee.
NOMINATION AND ELECTION OF DIRECTORS
The bylaws of the Company provide that the Board of Directors shall consist of
not less than five nor more than twenty-five directors. The exact number of
directors is currently set at twelve by Board resolution. The number of
directors may be increased or decreased within the foregoing range from time to
time by the Board of Directors or resolution of the shareholders. The terms of
office for directors continue until the next Annual Meeting of Shareholders and
until their successors are elected and qualified or until earlier resignation,
removal from office, or death.
<PAGE>
Each Proxy executed and returned by a shareholder will be voted as specified
thereon by the shareholder. If no specification is made, the Proxy will be
voted for the election of the nominees named below to constitute the entire
Board of Directors. In the event that any nominee withdraws or for any reason
is not able to serve as a director, the Proxy will be voted for such other
person as may be designated by the Board of Directors as substitute nominee,
but in no event will the Proxy be voted for more than twelve nominees.
Management of the Company has no reason to believe that any nominee will not
serve if elected. All the nominees are currently directors of the Company.
Directors are elected by a plurality of the votes cast by the holders of the
shares entitled to vote in the election at a meeting at which a quorum is
present. A quorum is present when the holders of a majority of the shares
outstanding on the record date are present at a meeting in person or by proxy.
An abstention would not be considered to be one of the "votes cast" for
purposes of the first sentence of this paragraph, but would be included in
determining whether a majority of the outstanding shares is represented for
determining whether a quorum is present at a meeting.
INFORMATION ABOUT NOMINEES FOR DIRECTOR
The following information as of March 1, 1998, has been furnished by the
respective nominees for Director. Except as otherwise indicated, each nominee
has been or was engaged in his present or last principal employment, in the
same or a similar position, for more than five years.
<TABLE>
<CAPTION>
Number of Shares
Information Owned Beneficially
Name (Age) About Nominee (Percent of Class)
<S> <C> <C>
John H. Clark (60) Chief Executive Officer and Director of Southwest 88,696
Georgia Bank (the "Bank") and the Company. (3.46%) (1)
Mr. Clark was named the Chief Executive
Officer and Vice Chairman of the Board for
both the Bank and the Company in December
1996. Previously, he has served as President
and Director of the Bank since 1978 and
President and Director of the Company
since 1980.
Cecil W. Alvis (63) Chief Operating Officer and President of the 26,428
Bank and Company. Mr. Alvis was promoted (1.03%) (2)
to this position in December 1996, and in 1997
he served for the first time as Director of
the Bank and Company. Mr. Alvis has served
in various other positions with the Bank and
the Company since 1977.
Leo T. Barber, Jr. (75) A Director of the Bank since 1951 and of 480,019
the Company since 1981, Mr. Leo Barber is (18.72%) (3)
Chairman of the Board of both the Bank and the
Company. He is a general partner of
South Georgia Finance Company, a family
investment company. Also, he is President of
South Georgia Investment Company, a rental and
investment company.
<PAGE>
Albert W. Barber (68) A Director of the Company and Bank since 1990, 461,062
Mr. Albert Barber is a general partner of (17.98%) (4)
South Georgia Finance Company, a family investment
company. Also, he is Vice President and Treasurer
of South Georgia Investment Company, a rental and
investment company.
Robert M. Duggan (66) A Director of the Bank since 1980 and of 36,044
the Company since 1981, Mr. Duggan is a (1.41%)
retired President of Davis Gas Company
and is currently self-employed as a tree
farmer.
E. J. McLean, Jr. (75) A Director of the Company since 1981 and of 49,699
the Bank since 1980, Mr. McLean is a retired (1.94%)
Vice President and active consultant of McLean
Engineering Company, Inc., a consulting
engineering firm.
Glenn D. Moon (68) A Director of the Bank and the Company since 3,802*
1995, Mr. Moon is a retired Senior Vice
President and Trust Officer of the Bank and
the Company.
Richard L. Moss (46) A Director of the Bank since 1980 and of the 21,049*
Company since 1981, Mr. Moss is
President of Moss Farms.
Lee C. Redding (51) A Director of the Bank and the Company since 21,346*
1995, Mr. Redding is a dentist and owner
of a family dental practice since 1976.
Roy Reeves (38) A Director of the Bank and the Company since 27,824
1991, Mr. Reeves is Secretary-Treasurer of (1.09%)
Kelly-Reeves Furniture Company and managing
partner with Reeves Properties, a property
rental company.
Jack Short (75) A Director of the Bank since 1975 and of the 21,331*
Company since 1981, Mr. Short is Vice Chairman
of the Board of both the Bank and the Company.
Also, he is a partner in the law firm of Short
and Fowler.
Johnny R. Slocumb (45) A Director of the Bank and the Company since 28,099
1991, Mr. Slocumb is owner of the Slocumb (1.10%)
Company, a company which offers real estate
and insurance services.
* Less than one percent (1%)
</TABLE>
<PAGE>
(1) Includes 52,696 shares allocated to the account of Mr. Clark in the Employee
Stock Ownership Plan and Trust, over which shares Mr. Clark exercises
voting power, 19,305 shares owned of record by Mr. Clark's wife as to which
Mr. Clark disclaims beneficial ownership.
(2) Includes 23,628 shares allocated to the account of Mr. Alvis in the Employee
Stock Ownership Plan and Trust, over which shares Mr. Alvis exercises voting
power.
(3) Includes 259,650 shares owned of record by the Louise W. Barber Trust, of
which Mr. Leo T. Barber is co-trustee, 124,840 shares owned of record by
the L.T.B., Sr., Trust of which Mr. Barber is co-trustee.
(4) Includes 259,650 shares owned of record by the Louise W. Barber Trust, of
which Mr. Albert Barber is co-trustee, 124,840 shares owned by the
L.T.B., Sr., Trust of which Mr. Barber is co-trustee, 2,600 shares owned
of record by Mr. Barber's wife as to which Mr. Barber disclaims beneficial
ownership, 2,000 shares held by the Paul B. Fontenot Trust and 2,000 shares
held by the Richard T. Fontenot Trust, of which Mr. Albert W. Barber is
trustee.
There are no family relationships between any director, executive officer, or
nominee for director of the Company or any of its subsidiaries with the
exception of two directors, Leo T. Barber, Jr., and Albert W. Barber, who are
brothers.
Meetings and Committees of the Board of Directors
The Board of Directors held 12 regular meetings during 1997. All of the
directors attended at least seventy-five percent (75%) of the Board and
committee meetings held during their tenure as directors.
The Company has a personnel committee of the Board of Directors. This committee
is composed of four members, John H. Clark, Leo T. Barber, Jr., Jack Short, and
Cecil W. Alvis. The committee, which recommends compensation levels for the
Bank's employees, held five meetings during 1997. The Company has an audit
committee of the Board of Directors who is also the standing audit committee
for the Bank's Board of Directors. This committee is composed of four members,
Albert W. Barber, E.J. McLean, Jr., Richard L. Moss, and Lee C. Redding. The
Company has no standing nominating committee of the Board of Directors or
committee performing similar functions.
EXECUTIVE COMPENSATION
The Company did not pay any remuneration to its officers during the year ended
December 31, 1997. The following table sets forth the annual and other
compensation paid or accrued for each of the last three fiscal years, including
directors' fees, for both John H. Clark, who is Vice Chairman of the Board of
Directors and Chief Executive Officer of the Company and the Bank, and Cecil W.
Alvis, who is Chief Operating Officer and President of the Company and the Bank.
No other executiveofficers of the Company were paid $100,000 or more in salary,
bonus, and directors' fees during 1997.
<PAGE>
<TABLE>
<CAPTION>
Summary Compensation Table
Name and Principal Annual Compensation All Other
Position During 1997 Year Salary Bonus Other Compensation
<S> <C> <C> <C> <C> <C>
John H. Clark 1997 $ 157,850 $ 50,000 $ 2,350 (1) $ 32,106 (2)
Vice Chairman and CEO of the 1996 148,700 50,000 1,800 (1) 28,350
Company and the Bank 1995 143,400 35,000 1,800 (1) 27,750
Cecil W. Alvis 1997 105,300 11,200 0 18,786 (3)
COO and President of the 1996 80,000 15,000 0 16,356
Company and the Bank (4) 1995 75,000 11,200 0 14,334
</TABLE>
(1) Amount represents fair market value of discount on stock purchased under the
Company's stock plan (Directors and Officers Stock Purchase Plan) for
officers and directors, which allows a participant to receive Common Stock
in lieu of salary and directors' fees, up to certain limits, with a value
of 150% of the cash compensation foregone by each participant.
(2) Mr. Clark's "other compensation" includes Bank's contributions to defined
contribution plan of $24,000, contribution to supplementary retirement plan
of $6,000, and premiums for group term life insurance of $2,106.
(3) Mr. Alvis's "other compensation" includes Bank's contribution to defined
contribution plan of $16,680 and premiums for group term life insurance of
$2,106.
(4) Mr. Alvis served for the first time in 1997 as Chief Operating Officer and
President of the Company and Bank.
The Company has never granted restricted stock, options, stock appreciation
rights, or similar awards to any of its present or past executive officers.
Pension Plan Table
The following table sets forth the estimated annual benefits payable upon
retirement under the Company's Pension Plan (including amounts attributable to
the Company's Supplemental Retirement Plan) in the specified compensation and
years of service classifications indicated below.
The compensation covered by the Pension Plan includes total annual compensation
including bonuses and overtime pay. The portion of compensation, which is
considered covered compensation under the Pension Plan for Mr. Clark and
Mr. Alvis, equals the annual salary and bonus amounts indicated in the Summary
Compensation Table. As of January 1, 1998, the credited full years of service
under the Pension Plan for both Mr. Clark and Mr. Alvis were 20 years.
<PAGE>
<TABLE>
<CAPTION>
Estimated annual normal retirement benefit assuming a
straight lifetime annuity and the years of service indicated (3)
Average Annual
Compensation 15 years 20 years 25 years 30 years 35 years
<S> <C> <C> <C> <C> <C>
Pension Plan
$ 100,000 $ 43,964 $ 46,952 $ 49,940 $ 52,928 $ 55,916
$ 150,000 66,864 71,652 76,440 81,228 86,016
$ 200,000 (1) 71,444 76,592 81,740 86,888 92,036
$ 250,000 (1) 71,444 76,592 81,740 86,888 92,036
Supplemental Retirement Plan
$ 200,000 (2) 18,320 19,760 21,200 22,640 24,080
$ 250,000 (2) 41,220 44,460 47,700 50,940 54,180
</TABLE>
(1) For the year ended December 31, 1997, the maximum covered compensation is
limited by federal law at $160,000.
(2) For Mr. Clark, who is covered under the Company's Supplemental Retirement
Plan, any excess annual retirement benefit which could not be paid under
the Pension Plan because of the federal law limitation described in footnote
(1) will be payable under the Supplemental Retirement Plan.
(3) The benefits listed in the Pension Plan Table are not subject to any
deduction for Social Security or other offset amounts.
Compensation of Directors
The Board of Directors of the Bank consists of the same members as the Board of
Directors of the Company. In 1997, the Chairman, Vice Chairman, and each
Director of the Bank received an annual fee of $8,000, $5,400, and $2,800,
respectively, and $100 per Bank's Board meeting attended from January through
April and $250 per meeting attended from May through December. Also, each
Director of the Bank received $50 per Bank's Board committee meeting attended
from January through April and $100 per meeting attended from May through
December. The Directors of the Company are not compensated for membership on
the Company's Board of Directors. Also, any director who elects to fully
participate in the Directors and Officers Stock Purchase Plan can receive up
to $3,000 annually from the Bank for the purpose of purchasing the Company's
Common Stock.
The Company has established a Key Individual Stock Option Plan which provides
for the issuance of options to executive officers and directors of the Company.
No options were granted under the plan to any director in 1997. The plan
provides for the grant of non-qualified stock options to directors of the
Company. The plan will be administered by the Personnel Committee of the Board
of Directors.
Employment Contracts and Termination of Employment and Change in Control
Arrangements
On December 23, 1997, the Company amended the employment agreement
(the "Agreement") with John H. Clark, dated November 21, 1989. This amendment
<PAGE>
extended the term (the "Term") of the Agreement to January 2, 2003, or until
the Agreement is earlier terminated, and amended the termination payment
schedule. Under the Agreement the Board of Directors of the Bank or Company
has discretion to determine Mr. Clark's compensation, based upon the financial
successes of and the contribution of Mr. Clark to the Bank and the Company.
Benefits of the kind customarily granted to other executives of the Bank and
Company, including disability insurance, medical insurance for life, and life
insurance, identical to that provided to Mr. Clark at the commencement of the
Term, until age 65 and thereafter with life insurance comparable to that
provided to retirees at the commencement of the Term, will be granted to Mr.
Clark under the Agreement. In determining Mr. Clark's compensation under the
Agreement, the Board subjectively considers Mr. Clark's tenure with the Bank
and Company and the growth in assets and the results of operations of the
Company during Mr. Clark's tenure.
Mr. Clark's employment may be terminated for cause if Mr. Clark violates or
breaches any material term of the Agreement, habitually neglects his duties,
or is convicted of a felony. If Mr. Clark is terminated for cause, the Bank
and the Company will have no further financial obligation to Mr. Clark.
If Mr. Clark's employment terminates for any reason, Mr. Clark agrees not to
provide banking services or solicit certain bank customers within certain
geographical limits within five years of such termination. In consideration
for such non-compete agreement and services rendered, if Mr. Clark's
employment is terminated without cause prior to the end of the Term, Mr. Clark
will receive a termination payment annually during the remainder of the Term.
The amount of such annual payment will depend upon the year of termination and
can vary from an annual payment of $115,000 for the remaining six years of
the Term to a single payment of $140,000, if Mr. Clark were terminated during
the last year of the Term.
Compensation Committee Interlocks and Insider Participation
The members who served during 1997 on the Personnel Committee which recommends
compensation levels for the Company's executives and other employees were
Leo T. Barber, Jr., Jack Short, John H. Clark, and Cecil W. Alvis.
During 1997 the Company's Chief Executive Officer, John H. Clark, and the Chief
Operating Officer and President, Cecil W. Alvis as members of the Personnel
Committee participated in deliberations concerning executive compensation,
other than deliberations concerning their own compensation.
The Company employs the law firm of Short & Fowler to provide legal services to
the Company and the Bank, which legal services include general legal services,
as well as loan closing services. The law firm receives fees for general legal
services, as well as fees earned in connection with loan closings, which fees
are collected from the persons making the loans from the Bank. Jack Short, a
director of the Company and the Bank, is a partner in the law firm. The Company
believes the services obtained from the law firm are on terms as favorable to
the Company as could have been obtained from unaffiliated parties.
Committee Report on Executive Compensation
The Personnel Committee (the "Committee") of the Board of Directors consists of
four members, two outside directors and two executive officers of the Company.
<PAGE>
The Committee reviews, evaluates, and approves compensation and benefits for
all officers and also reviews general policy matters relating to compensation
and benefits of the other employees. A role of the executive officers on the
Committee is to provide the Committee with competitive information of salaries
and other compensation of other financial institutions, review each individual
officer's performance, and make recommendations to the Committee for salaries
of officers other than themselves.
The Personnel Committee's intent is to maintain the following standards:
. Attract, motivate, reward, and retain high-performing and
dedicated management employees.
. Balance competitive need, corporate, individual, and business
unit performance, and affordability.
. Provide competitive financial security for executives and
dependents in the event of death, disability, or retirement.
Base Salary and Bonus
Executive officer base salary and bonus awards are determined with reference
to Company-wide, divisional, and individual performance for the previous
fiscal year based on a wide range of measures which includes comparisons with
competitors' performance and internal goals set before the start of each fiscal
year and by comparison to the level of executive officers' compensation of
other financial institutions of comparable size. No relative weights were
assigned for these factors. Comparisons with competitors' performance included
some but not all of the institutions included in the Independent Bank Index, to
which the Company's total return is compared in this Proxy Statement. The
Committee believes that the most meaningful performance and pay equity
comparisons are made against companies of similar size and similar business
interests. In keeping with this belief, the Committee consistently participates
in and uses compensation and benefit surveys from the Georgia Bankers
Association and the Bank Administration Institute.
Stock Option
Effective March 19, 1997, the Company has established a Key Individual Stock
Option Plan which provides for the issuance of options to key employees and
directors of the Company. In April 1997, the plan was approved by the Company's
shareholders, and it will be effective for ten years. A maximum of 150,000
shares of common stock have been authorized for issuance with respect to
options granted under the plan. No options were granted under the plan to any
employee or director in 1997. The plan provides for the grant of incentive
stock options and non-qualified stock options to key employees and directors
of the Company. The plan will be administered by the Personnel Committee of
the Board of Directors.
Compensation of Chief Executive Officer
The Chief Executive Officer's base salary and bonus for 1997 were determined
with reference to the same measures used for all executive officers of the
Company, but the primary measurement is Company-wide performance. The Company
exceeded its target goals on all of the Company's performance measures. The
Committee believes the returns on assets (ROA) and equity (ROE) are the most
appropriate measures for evaluating the Company's results. In 1997, the
Company's net income increased over 10 percent from the previous year's net
<PAGE>
income, the ROA was 1.62 percent, and ROE was 14.37 percent, compared to ROA
of 1.51 percent and ROE of 14.46 percent in 1996.
In December 1997, the company amended the employment agreement with Mr. Clark
dated November 21, 1989. This amendment extended the term of the employment
agreement to January 2, 2003 or until the employment agreement is earlier
terminated, and amended the termination payment schedule as described earlier
under "Employment Contracts and Termination of Employment and Change in Control
Agreement".
In keeping with the Committee's belief that the most meaningful performance
and pay equity comparisons are made against companies of similar size and
business interests, the Committee consistently uses the Federal Financial
Institution Examining Council Peer Group Report. The earnings performance for
the Company placed it in the 84th percentile when compared to other similar
one-bank holding companies in the peer group.
Leo T. Barber, Jr. Jack Short
John H. Clark Cecil W. Alvis
Performance Graph
The following graph compares the cumulative total shareholder return of the
Company's Common Stock with The Carson Medlin Company's Independent Bank Index
and the S&P 500 Index. The Independent Bank Index is the compilation of the
total return to shareholders over the past five years of a group of 23
independent community banks located in the southeastern states of Florida,
Georgia, North Carolina, South Carolina, Tennessee, and Virginia. The
comparison assumes $100 was invested January 1, 1992, and that all semi-annual
and quarterly dividends were reinvested each period. This comparison takes
into consideration changes in stock price, cash dividends, stock dividends,
and stock splits.
The comparisons in the graph are required by the Securities and Exchange
Commission and are not intended to forecast or be indicative of possible future
performance of the Company's Common Stock.
<TABLE>
SOUTHWEST GEORGIA FINANCIAL CORPORATION
Five Year Performance Index
<CAPTION>
1992 1993 1994 1995 1996 1997
<S> <C> <C> <C> <C> <C> <C>
Southwest Georgia Financial Corporation 100 110 127 166 289 334
Independent Bank Index 100 125 155 208 248 358
S&P 500 Index 100 110 111 153 189 251
</TABLE>
OTHER MATTERS RELATING TO EXECUTIVE OFFICERS, DIRECTORS,
AND PRINCIPAL SHAREHOLDERS
The Bank from time to time has had, and expects to have in the future, banking
transactions in the ordinary course of business with officers and directors of
the Company and their related interests, on substantially the same terms,
<PAGE>
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons. Such transactions have not
involved more than the normal risk of collectibility or presented other
unfavorable features. At December 31, 1997, loans to officers, directors, and
principal shareholders of the Company and the Bank and to certain of their
related interests amounted to $1,170,099.
INFORMATION CONCERNING THE COMPANY'S ACCOUNTANTS
Draffin & Tucker was the principal independent public accountant for the
Company during the year ended December 31, 1997. Representatives of
Draffin & Tucker are expected to be present at the annual meeting and will
have the opportunity to make a statement if they desire to do so and to respond
to appropriate questions. The Company anticipates that Draffin & Tucker will
be the Company's accountants for the current fiscal year.
SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the Company's 1999 Annual
Meeting of Shareholders must be received by November 26, 1998, in order to be
eligible for inclusion in the Company's Proxy Statement and Proxies for that
meeting.
OTHER MATTERS THAT MAY COME BEFORE THE MEETING
Management of the Company knows of no matters other than those stated above
that are to be brought before the meeting. If any other matters should be
presented for consideration and voting, however, it is the intention of the
persons named as proxies in the enclosed Proxy to vote in accordance with their
judgment as to what is in the best interest of the Company.
By order of the Board of Directors,
John H. Clark
Vice Chairman and
Chief Executive Officer
March 27, 1998
<PAGE>
COMMON STOCK
OF
SOUTHWEST GEORGIA FINANCIAL CORPORATION
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE 1998 ANNUAL MEETING
OF SHAREHOLDERS.
The undersigned hereby appoint(s) E. J. McLean, Jr. and John J. Cole,
Jr., or either of them with power of substitution to each, as Proxies of the
undersigned to vote the Common Stock of the undersigned at the Annual Meeting
of Shareholders of SOUTHWEST GEORGIA FINANCIAL CORPORATION (the "Company") to
be held on April 28, 1998, and any adjournment thereof.
1. Election of Directors (Please check either A or B)
A. _____ I (we) grant authority to vote FOR all nominees for
director listed below except as marked to the contrary
in the space provided:
Cecil W. Alvis; Albert W. Barber; Leo T. Barber, Jr.;
John H. Clark; Robert M. Duggan; E. J. McLean, Jr.;
Glenn D. Moon; Richard L. Moss; Lee C. Redding;
Roy H. Reeves; Jack Short; and Johnny R. Slocumb.
Instructions: To withhold authority to vote for any of the
individual nominees listed above, write the name(s) of the
nominee(s) on the lines provided below.
___________________________________________________________
___________________________________________________________
B. _____ I (we) withhold authority to vote for all of the nominees
listed above.
2. Other Matters to Come Before the Meeting
I (we) grant the Proxies authority to vote in accordance with their best
judgment with respect to any other matters that may properly come before the
meeting.
THE BOARD OF DIRECTORS FAVORS A VOTE "FOR" THE FOREGOING PROPOSAL AND,
UNLESS THE VOTE OF THE SHAREHOLDER INDICATES OTHERWISE, THIS PROXY WILL BE SO
VOTED.
X__________________________
X__________________________
Please sign this Proxy exactly as name appears
at left. In the case of joint tenants, each
joint owner must sign. Note: When signing as
an attorney, trustee, administrator or
guardian, please give your title as such.
Date Signed: ________________
<PAGE>
COMMON STOCK OF SOUTHWEST GEORGIA FINANCIAL CORPORATION
DIRECTIONS FOR VOTING COMMON STOCK ALLOCATED
TO A PARTICIPANT'S ACCOUNT PURSUANT TO THE
SOUTHWEST GEORGIA FINANCIAL CORPORATION
EMPLOYEE STOCK OWNERSHIP TRUST
A PROXY IS SOLICITED FROM SOUTHWEST GEORGIA BANK TRUST DEPARTMENT AS TRUSTEE
BY THE BOARD OF DIRECTORS FOR THE 1998 ANNUAL MEETING OF SHAREHOLDERS.
The undersigned participant in the Employee Stock Ownership Plan
("ESOP") hereby directs Southwest Georgia Bank Trust Department as Trustee of
the Southwest Georgia Financial Corporation Employee Stock Ownership Trust to
vote those shares of Common Stock of Southwest Georgia Financial Corporation
allocated to the undersigned's account in connection with the Annual Meeting
of Shareholders of SOUTHWEST GEORGIA FINANCIAL CORPORATION (the "Company") to
be held on April 28, 1998, and any adjournment thereof.
1. Election of Directors (Please check either A or B)
A. _____ I grant authority to vote FOR all nominees for
director listed below except as marked to the
contrary in the space provided:
Cecil W. Alvis; Albert W. Barber; Leo T. Barber, Jr.;
John H. Clark; Robert M. Duggan; E. J. McLean, Jr.;
Glenn D. Moon; Richard L. Moss; Lee C. Redding;
Roy H. Reeves; Jack Short; and Johnny R. Slocumb.
Instructions: To withhold authority to vote for any
of the individual nominees listed above, write the
name(s) of the nominee(s) on the lines provided below.
_______________________________________________________
_______________________________________________________
B. _____ I withhold authority to vote for all of the nominees
listed above.
2. Other Matters to Come Before the Meeting
I grant the Trustee authority to vote in accordance with their best
judgment with respect to any other matters that may properly come before the
meeting.
THE BOARD OF DIRECTORS FAVORS A VOTE "FOR" THE FOREGOING PROPOSAL
AND, UNLESS THE VOTE OF THE SHAREHOLDER INDICATES OTHERWISE, THIS PROXY WILL
BE SO VOTED.
X_______________________________
Please sign this Proxy exactly as name appears
at left. Note: When signing as an attorney,
trustee, administrator or guardian, please give
your title as such.
Date Signed: _____________________
<PAGE>
