<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-K/A
Amendment No. 2 to Annual Report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended December 31, 1998
Commission File number 0-26254
Century South Banks, Inc.
-------------------------
(Exact name of registrant as specified in its charter)
Georgia 58-1455591
- -------------------------------------------------------------------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
60 Main Street West, Dahlonega, Georgia 30533
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (706) 864-1111
--------------
Securities registered pursuant to Section 12(b) of the Act: None
----
Securities registered pursuant to Section 12(g) of the Act: Common stock, $1.00
-------------------
par value
- ---------
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes: X No
-
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the Registrant's common stock (based upon the mean
of the closing high and low sales price reported by the Nasdaq Stock Market)
held by nonaffiliates as of March 24, 1999 was approximately $200,644,607. For
the purposes of this response, directors, executive officers, and holders of 5%
or more of the Registrant's common stock are considered affiliates of the
Registrant at that date.
The Registrant had 10,992,227 shares of its common stock outstanding as of March
24, 1999.
The following items are amended:
Part III:
Item 10. Directors and Executive Officers of the Registrant.
Item 11. Executive Compensation.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Item 13. Certain Relationships and Related Transactions.
<PAGE>
ITEM III
Item 10. Directors and Executive Officers of the Registrant.
The information concerning the executive officers of Century South Banks, Inc.
(the "Company") required by this Item is set forth in Part 1, Item 1 under the
heading "Executive Officers." The following table sets forth certain
information regarding the Company's directors:
Name Age
---- ---
William H. Anderson, II 61
James R. Balkcom, Jr. 54
William R. Chandler 76
Joseph W. Evans 49
James A. Faulkner 54
Thomas T. Folger, Jr. 64
Quill 0. Healey 59
J. Russell Ivie 63
Frank C. Jones 73
John B. McKibbon, III 43
E. Paul Stringer 67
William H. Anderson, II has been the Chairman of the Company since December
1997. Until that time, Mr. Anderson served as Chairman of Bank Corporation of
Georgia ("BCG") prior to its merger into the Company in December 1997. Mr.
Anderson is also the Chairman of Southern Trust Insurance Company, Macon,
Georgia.
James R. Balkcom, Jr. has served as Chairman of PAMECO Corp., a distributor
of heating, ventilation and air conditioning equipment and parts, located in
Norcross, Georgia since February 1996. On January 11, 1999, Mr. Balkcom assumed
the additional duties of President and Chief Executive Officer of PAMECO. Mr.
Balkcom served as Chairman and President of Techsonic Industries, Inc., a
manufacturer of depth finders, from 1977 through 1995.
William L. Chandler has owned Chandler Farm and has served as President of
Chandler-Stovall, a real estate investment and management company, in Ila,
Georgia for more than five years.
Joseph W. Evans has been the President, Chief Operating Officer and Chief
Financial Officer of the Company since December 16, 1997. Until that time, Mr.
Evans was, since 1984, the President and Chief Executive Officer of BCG prior to
its merger into the Company in December 1997 since 1984.
James A. Faulkner has been the Vice-Chairman and Chief Executive Officer of
the Company since December 1997. Until that time, Mr. Faulkner was the President
since 1989 and Chief Executive Officer since 1991 of the Company.
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Thomas T. Folger, Jr. is a partner in Folger Poultry Farms, Dahlonega,
Georgia, and has held this position for more than the past five years.
Quill O. Healey has been the Chairman of the United States affiliate of
J&H Marsh & McLennan, a multi-line insurance broker, since March 22, 1999. Until
that time, Mr. Healey was the Chairman and Chief Executive Officer of Sedgwick,
Inc., a multi-line insurance broker with offices in Atlanta, Georgia since 1990.
J. Russell Ivie has been the Vice-Chairman of the Company since December
1997. Until that time, Mr. Ivie was, since 1989, Chairman of the Company.
Frank C. Jones is a partner in the law firm of King & Spalding, Atlanta,
Georgia and has held this position for more than the past five years.
John B. McKibbon, III is the Chief Executive Officer of McKibbon Brothers,
Inc., a hotel development and management company with holdings in six
southeastern states, and has held this position for more than the past five
years. Mr. McKibbon is also a director of HCI Communications, Inc. and Applied
Innovations, Inc., both located in Gainesville, Georgia.
E. Paul Stringer owns and operates Stringer Insurance Agency, Dahlonega,
Georgia, and has held this position for more than the past five years.
2
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Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, and related
regulations of the SEC require the Company's officers and directors, and persons
who own more than 10% of the Company's common stock, to file reports of their
ownership of the Company's common stock with the SEC and the Nasdaq National
Market System ("Nasdaq"). The regulations also require these persons to furnish
the Company with copies of all Section 16(a) forms they file.
Based solely upon a review of the copies of those reports furnished to the
Company, the Company believes that all filing requirements applicable to such
persons have been complied with in 1998 except that Sidney J. Wooten, Executive
Vice President and Regional Executive, inadvertently failed to timely file a
Form 4, Report of Changes in Beneficial Ownership of Securities, with the SEC
and Nasdaq.
Item 11. Executive Compensation.
The following tables and narrative text discuss the compensation paid or accrued
over the past three years for the Company's Chief Executive Officer and the
Company's four other most highly compensated executive officers.
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
------------------------------ --------------------------
Restricted Securities All Other
Salary Bonus Stock Underlying Compensation
Name and Principal Position Year ($) ($) Awards($)(6) Options (#) ($)(1)
- ------------------------------------- ------- ------- ---------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
James A. Faulkner, Vice Chairman 1998 239,275 86,982 76,642 40,000 9,945
and Chief Executive Officer 1997 210,000 84,000 -0- -0- 10,085
1996 210,000 50,476 -0- -0- 9,956
Joseph W. Evans, President, Chief 1998 215,600 78,708 76,642 -0- 5,540
Operations Officer and Chief 1997 178,400 80,100 -0- -0- 15,106
Financial Officer/(2)/ 1996 178,000 48,060 -0- -0- 8,229
Sidney J. Wooten, Executive Vice 1998 180,000 60,480 51,095 -0- 3,915
President and Regional Executive/(3)/ 1997 52,500 40,000 -0- -0- 226
1996 -0- -0- -0- -0- -0-
Stephen W. Doughty, Executive 1998 170,350 32,844 51,095 -0- 5,518
Vice President and Chief Credit 1997 120,000 48,000 -0- -0- 40,243
Officer/(4)/ 1996 120,000 28,800 -0- -0- 34,216
J. Thomas Wiley, Jr. Executive Vice 1998 145,883 29,325 51,095 -0- 5,518
President and Regional Executive/(5)/ 1997 120,000 48,000 -0- -0- 38,541
1996 120,000 28,800 -0- -0- 38,673
</TABLE>
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/(1)/ For 1998 includes: for Mr. Faulkner, deferred compensation of $3,000,
insurance premiums paid by the Company of $1,345 and contributions to a savings
plan of $5,000; for Mr. Evans, insurance premiums paid by the Company of $540
and contributions to a savings plan of $5,000; for Mr. Wooten insurance premiums
of $540 paid by the Company and contributions to a savings plan of $3,375; for
Mr. Doughty, insurance premiums paid by the Company of $518, and contributions
to a savings plan of $5,000; for Mr. Wiley, insurance premiums paid by the
Company of $518 and contributions to a savings plan of $5,000.
3
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/(2)/ Mr. Evans assumed this position in December 1997. Amounts prior to such
time were paid by BCG which was merged into the Company in December 1997.
/(3)/ Mr. Wooten assumed this position on September 15, 1997. Mr. Wooten was
previously employed with another bank holding company.
/(4)/ Mr. Doughty assumed this position in December 1997. Amounts prior to such
time were paid by BCG which was merged into the Company in December 1997.
/(5)/ Mr. Wiley was elected as an executive officer of the Company on July 22,
1998. Mr. Wiley is paid by AmeriBank, N.A., a the Company banking subsidiary
and serves as President and CEO of AmeriBank, N.A.
/(6)/ The earning of such awards is based upon the Company attaining specific
earnings per share ("EPS") performance goals as established by the Compensation
Committee. Upon attaining various EPS levels, the awards are earned over a
five-year period. The earning of such awards is subject to a service condition
which shall be satisfied if the participant remains in the continuous employ of
the Company and its subsidiaries from the grant date through the earlier of the
date the participant reaches age 62 or the 10th anniversary of the date such
grant is made. Upon a change in control of the Company, all awards or portions
of awards earned up until such date become vested and payable. Prior to
vesting, the participant is eligible to receive dividends on and to vote the
restricted shares. For 1998, Messrs. Faulkner and Evans earned 2,250 awards,
respectively, and Messrs. Wooten, Doughty and Wiley earned 1,500 awards,
respectively.
Option Grants in Last Fiscal Year
The following table sets forth certain information concerning options granted
during 1998 to the named executives:
<TABLE>
<CAPTION>
Individual Grants
-------------------------- Potential Realizable Value
Number of % to Total At Assumed Annual Rates
Securities Options Exercise of Stock Price Appreciation
Underlying Granted to or base for Option Term(1)
Options Employees in Price Expiration ---------------------------
Name Granted Fiscal Year ($/share) Date 5% ($) 10% ($)
- ---- --------- ------------ --------- ---------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
James A. Faulkner 40,000(2) 61.5% $28.50 8/24/08 30,750 86,500
</TABLE>
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/(1)/ The dollar gains under these columns result from calculations assuming 5%
and 10% growth rates as set by the Securities and Exchange Commission (the
"SEC") and are not intended to forecast future price appreciation of the Company
Common Stock. The gains reflect a future value based upon growth at these
prescribed rates. the Company did not use an alternative formula for a grant
date valuation, an approach which would state gains at present value based on
future unknown or volatile factors.
/(2)/ Represents a grant under the ISO Plan.
It is important to note that options have value to recipients, including the
listed executives, only if the Company's stock price advances beyond the
exercise of base price shown in the table during the effective option period.
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Aggregated Option Exercises in Last Fiscal Year
and FY-End Option Values
The following table sets forth certain information regarding the exercise
of stock options during 1998 by the named executives and the value of options
held by such persons at the end of 1998.
<TABLE>
<CAPTION>
Securities Underlying Value of Unexercised
Shares Unexercised In-the-Money
Acquired on Value Options at FY-end (#) Options at FY-end($)
Name Exercise (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
- ----- ----------- ----------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
James A. Faulkner 2,500 51,250 2,500/0 57,188/0
3,000/0 47,625/0
40,000/0 0/0
Joseph W. Evans -0- -0- 47,250/0 1,092,094/0
Sidney J. Wooten -0- -0- 25,000/0 240,625/0
Stephen W. Doughty 31,499 840,409 0/0 0/0
23,625 622,828 0/0 0/0
J. Thomas Wiley, Jr. 31,499 753,787 0/0 0/0
23,625 557,859 0/0 0/0
</TABLE>
Long-Term Incentive Plan - Awards in Last Fiscal Year(1)
<TABLE>
<CAPTION>
Performance or Estimated Future Payouts
Number of Shares, Other Period Until Under Non-Stock Price-Based Plans(3)
Units or Other Maturation ------------------------------------
Name Rights(2) or Payout Threshold (#) Target/Maximum(#)
- ---- ---------------- ------------------ --------------- -----------------
<S> <C> <C> <C> <C>
James A. Faulkner 15,000/(4)/ 5 years 3,750 15,000
Joseph W. Evans 15,000/(4)/ 5 years 3,750 15,000
Sidney J. Wooten 10,000/(5)/ 5 years 2,500 10,000
Stephen W. Doughty 10,000/(5)/ 5 years 2,500 10,000
J. Thomas Wiley, Jr. 10,000/(5)/ 5 years 2,500 10,000
</TABLE>
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/(1)/ As discussed in footnote 6 to the Summary Compensation Table, the earning
of restricted stock awards is based upon the Company attaining specific earnings
per share ("EPS") performance goals as established by the Compensation
Committee. Upon attaining various EPS levels, the awards are earned over a five-
year period. The earning of such awards is subject to a service condition which
shall be satisfied if the participant remains in the continuous employ of the
Company and its subsidiaries from the grant date through the earlier of the date
the participant reaches age 62 or the 10th anniversary of the date such grant is
made. Upon a change in control of the Company, all awards or portions of awards
earned up until such date become fully vested and payable. Prior to vesting, the
participant is eligible to receive dividends on and to vote the restricted
shares.
/(2)/ Includes the entire amount of the restricted stock award, although as
discussed in footnote 1 above, such amount may never be earned.
/(3)/ The threshold amount is 25% of any year's award and can be earned if
minimum performance targets are achieved. The target/maximum amounts are earned
if specified performance targets are achieved. If the Company's actual EPS
performance does not attain the minimum performance target, no payouts will be
for the performance period.
5
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/(4)/ For 1998, the recipient earned 2,250 awards out of a maximum of 3,000.
/(5)/ For 1998, the recipient earned 1,500 awards out of a maximum of 2,000.
Employment and Severance Agreements
- -----------------------------------
James A. Faulkner has entered into an employment agreement with the
Company. The agreement is for a one-year term ending on November 1, 1999 and
provides compensation to Mr. Faulkner in the form of an annual base salary in
the amount of $250,000, which may be adjusted annually by agreement of the
parties. The agreement automatically renews for a one-year term without
further action by either party, commencing on the one year anniversary of the
agreement and each anniversary thereafter unless written notice to the contrary
is provided by either party to the other party at least 90 days prior to any
anniversary date.
Mr. Faulkner's employment agreement also provides that if he is terminated
for any reason other than for cause he will receive severance benefits equal to
the remaining term of the contract. If Mr. Faulkner terminates the agreement
for reasons such as a material change by the Company in his duties and
responsibilities or as a result of the merger or consolidation of the Company,
or the death or disability of Mr. Faulkner, he shall receive severance benefits
from the Company equal to two and eleven twelfths (2 11/12) multiplied by Mr.
Faulkner's annual compensation, including salary, bonuses, perquisites, and all
other forms of compensation for the fiscal year ended immediately preceding the
date of change of control.
Incentive Stock Option Plan
- ---------------------------
The Company's ISO Plan authorizes the Company to grant incentive stock
options to eligible employees as determined by the ISO Plan. The ISO Plan is
administered by the Compensation Committee, which determines those eligible
employees to whom options will be granted and the number of options granted to
each eligible employee. The Compensation Committee also prescribes the terms
and conditions of each option granted, including the purchase price per share as
to each option. During 1998, 65,000 options were granted under the ISO Plan.
Savings Plan
- ------------
The Company has adopted a savings plan and permits all eligible employees
to participate. During 1998, as a result of the merger of BCG into the Company,
BCG merged its 401(k) Savings Plan into the Company's Amended and Restated
Employee Stock Ownership Plan. The resulting plan is called the Century South
Banks, Inc. Savings Plan (the "Savings Plan"). In conjunction with the merger
of the two plans, the Company has ceased to make contributions to the employee
stock ownership feature of the Savings Plan and has elected to increase the
percentage of employee deferrals, which are then matched by the Company. the
Company's contribution to the Savings Plan for the year ended December 31, 1998
was $516,000. Contributions made by the Company during such year were $5,000
for each of Messrs. Faulkner, Evans, Doughty, and Wiley and $3,375 for Mr.
Wooten. Each of Messrs. Faulkner, Evans, Doughty, and Wiley are fully vested
pursuant to the terms of the Savings Plan.
6
<PAGE>
Deferred Compensation Plan
- --------------------------
The Company has entered into salary continuation agreements with James A.
Faulkner and Tony E. Collins. These agreements provide for the Company to pay
death and disability benefits to each of Messrs. Faulkner and Collins or their
beneficiaries, subject to certain vesting requirements and other limitations,
and are funded by life insurance policies. No benefits were paid under these
agreements in 1998.
Executive Stock Plan
- --------------------
On April 1, 1998, the Board of Directors of the Company adopted the Century
South Banks, Inc. 1998 Executive Stock Plan (the "Executive Stock Plan") which
was approved by the shareholders on May 13, 1998. The purpose of the Executive
Stock Plan is to encourage and provide an additional incentive to increase the
value of the Company and its common stock by permitting them to encourage and
provide an additional incentive to officers and other key employees a
significant equity interest in the Company. The Executive Stock Plan is also
intended to aid the Company in attracting and retaining superior personnel and
to strengthen their desire to remain in the Company's employ.
Up to 3.5% of the Company's outstanding common stock has been reserved for
issuance in connection with awards granted under the Executive Stock Plan. Such
shares may be awarded from authorized and unissued shares or from previously
issued shares, which are acquired in open market purchases. The Executive Stock
Plan is administered by the Compensation Committee, none of the members of
which are eligible to participate in the Executive Stock Plan.
The Executive Stock Plan provides for the issuance of shares of the Company
common stock through grants of options to purchase the Company common stock,
grants of stock appreciation rights and grants of restricted stock. The
Executive Stock Plan allows for the issuance of incentive stock options and
options which will not be treated as incentive stock options. Participants are
not required to pay for shares of the Company common stock awarded as restricted
stock.
Director Compensation
- ---------------------
Officers of the Company who are also regular directors do not receive any
fee or remuneration for services as members of the Company Board of Directors.
In 1996, non-management directors of the Company received a fee of $4,000 per
quarter with the exception that Thomas T. Folger, Jr. received an additional
$100 for each Executive Loan Committee meeting attended, William H. Anderson, II
received fees of $65,000 for serving as Chairman of the Company Board of
Directors and J. Russell Ivie received fees of $95,309 for serving as Vice
Chairman of the Company Board of Directors.
7
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Item 12. Security Ownership of Certain Beneficial Owners and Management.
The following table sets forth the beneficial ownership of the Company's
outstanding common stock by (i) the current director nominees and executive
officers named herein, and (ii) all executive officers and the current directors
as a group, as of March 21, 1999. Unless otherwise indicated, the listed
persons are the owners of record and have sole voting and investment powers over
their shares.
<TABLE>
<CAPTION>
Amount and Nature of
Name Beneficial Ownership Percent of Class
- ---- -------------------- ----------------
<S> <C> <C>
William H. Anderson, II 724,504/(1)/ 6.6
James B. Balkcom, Jr. 3,000/(2)/ *
William L. Chandler 232,000/(3)/ 2.1
Tony E. Collins 41,05l/(4)/ *
Stephen W. Doughty 117,82l/(5)/ 1.1
Joseph W. Evans 358,339/(6)/ 3.2
James A. Faulkner l44,973/(7)/ 1.3
Thomas T. Folger, Jr. 172,080/(8)/ 1.6
Quill O. Healey 8,437/(9)/ *
J. Russell Ivie 300,567/(10)/ 2.7
Frank C. Jones 5,500/(11)/ *
John B McKibbon, III 5,800/(12)/ *
E. Paul Stringer 228,882/(13)/ 2.1
J. Thomas Wiley, Jr. 111,032/(14)/ 1.0
Sidney J. Wooten 31,500/(15)/ *
All Executive Officers and
Current Directors as a Group
(15 persons) 2,485,486 22.3
</TABLE>
- -----------
* less than 1%
/(1)/ Includes 65,407 shares owned individually and an aggregate of 659,097
shares held by certain corporations, partnerships and trusts as to which Mr.
Anderson has voting and/or investment power. Does not include 1,919 shares owned
by Mr. Anderson's wife individually, as to which he disclaims beneficial
ownership.
/(2)/ Includes 3,000 shares owned individually which are held in street name.
/(3)/ Includes 112,000 shares owned individually and 120,000 shares owned by a
corporation, which Mr. Chandler controls. Does not include 5,600 shares owned by
Mr. Chandler's wife individually, to which he disclaims beneficial ownership.
/(4)/ Includes 3,690 shares owned individually which are held in street name,
302 shares owned jointly with Mr. Collin's father, 9,559 shares held in a
savings plan and 26,000 shares subject to stock options under the Company's
Incentive Stock Option Plan (the "ISO Plan") as to which Mr. Collins disclaims
beneficial ownership. Also includes 1,500 shares of restricted stock subject to
forfeiture granted under the Company's Executive Stock Plan.
/(5)/ Includes 12,599 shares owned individually, 63,373 shares owned
individually which are in street name, and 20,349 shares held in a savings plan.
Also includes 1,500 shares of restricted stock subject to forfeiture granted
under the Company's Executive Stock Plan.
/(6)/ Includes 189,403 shares owned individually, 36,625 shares owned
individually which are held in street name, 40,500 shares held in a family
partnership and 42,311 shares held in a savings plan and includes 47,250 shares
subject to stock options under the ISO Plan as to which Mr. Evans disclaims
beneficial ownership. Also includes 2,250 shares of restricted stock subject to
forfeiture granted under the Company's Executive Stock Plan.
/(7)/ Includes 78,632 shares owned individually, 56 shares owned jointly with
Mr. Faulkner's wife, 3,350 shares held in street name, 17,685 shares held in a
savings plan, and 43,000 shares subject to stock options under the ISO Plan as
to which Mr. Faulkner disclaims beneficial ownership. Also includes 2,250 shares
of restricted stock subject to forfeiture granted under the Company Executive
Stock Plan.
8
<PAGE>
/(8)/ Includes 165,195 shares owned individually, 5,234 shares held in a self
directed retirement account owned individually and 1,651 shares which are held
in street name in a retirement account owned individually. Does not include
19,851 shares owned individually by Mr. Folger's wife and 4,752 shares owned by
Mr. Folger's wife jointly with their children.
/(9)/ Includes 8,437 shares owned individually which are held in street name.
/(10)/ Includes 143,020 shares owned individually, 14,434 shares owned jointly
with Mr. Ivie's wife, 17,206 shares held in street name, 19,277 shares owned by
a trust of which he serves as the trustee and is a beneficiary, 14,429 shares
which are held in street name owned individually in a retirement account, 32,357
shares which are held in street name owned by a limited partnership, 45,202
shares owned by a limited partnership of which he is a limited partner and
14,642 shares held in a savings plan. Does not include 121 shares owned by Mr.
Ivie's wife as to which he disclaims beneficial ownership.
/(11)/ Includes 5,500 shares owned individually which are held in street name.
Does not include 1,000 shares owned in street name by Mr. Jones' wife as to
which he disclaims beneficial ownership.
/(12)/ Includes 5,700 shares owned individually which are held in street name
and 100 shares owned by a corporation as to which Mr. McKibbon has voting and/or
investment power which are held in street name.
/(13)/ Includes 200,262 shares owned individually, 5,946 shares owned jointly
with Mr. Stringer's wife and children, 750 shares owned jointly with his wife,
18,924 shares owned by a corporation as to which Mr. Stringer has voting and/or
investment power and 3,000 shares held in a retirement account owned
individually. Does not include 43,164 in a retirement account owned individually
by Mr. Stringer's wife as to which he disclaims beneficial ownership.
/(14)/ Includes 88,073 shares owned individually which are held in street name
and 21,459 shares held in a savings plan. Also includes 1,500 shares of
restricted stock subject to forfeiture granted under the Company's Executive
Stock Plan.
/(15)/ Includes 5,000 shares owned individually which are held in street name in
a retirement account, and 25,000 shares subject to stock options under the ISO
Plan as to which Mr. Wooten disclaims beneficial ownership. Also includes 1,500
shares earned of restricted stock subject to forfeiture granted under the
Company's Executive Stock Plan.
Item 13. Certain Relationships and Related Transactions
E. Paul Stringer, director, owns Stringer Insurance Agency in Dahlonega,
Georgia, which was paid insurance premiums during 1998 by the Company and its
subsidiaries in an amount equal to $406,734. In the opinion of management, these
premiums are fair and reasonable and as favorable to the Company as those which
could have been obtained from unrelated third parties.
William H. Anderson, II, director, is a limited partner in a limited partnership
that owns two of the bank buildings which the Company and its subsidiary, First
South Bank, N.A., lease at rates which, in the opinion of management, are fair
and reasonable and as favorable to the Company as those which could have been
obtained from unrelated third parties. The Company and First South Bank, N.A.
paid to Mr. Anderson $124,885 in connection with such lease payments.
Frank C. Jones, director, is a partner in the law firm of King & Spalding. King
& Spalding rendered legal services to the Company and its subsidiaries in 1998
and may render legal services to the Company and its subsidiaries in 1999.
In the ordinary course of banking business, the Company and its subsidiaries
have had, and anticipate that they will continue to have, transactions with
various directors, officers, principal shareholders of the Company, and their
associates. All loans and commitments to extend loans included in such
transactions were made substantially on the same terms, including interest rates
and collateral, as those prevailing from time to time for comparable
transactions with other unaffiliated persons. In the opinion of management,
such loans and commitments do not involve
9
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more than a normal risk of collectibility or present any other unfavorable
features.
10
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
<TABLE>
<CAPTION>
<S> <C>
Date: June 3, 1999 CENTURY SOUTH BANKS, INC.
/s/ James A. Faulkner
----------------------------------------------
James A. Faulkner
Vice Chairman, Chief Executive Officer and
Director
Date: June 3, 1999 /s/ Joseph W. Evans
---------------------------------------------------------
Joseph W. Evans
President, Chief Operating Officer, Chief
Financial Officer and Directors
Date: June 3, 1999 /s/ Susan J. Anderson
---------------------------------------------------------
Susan J. Anderson
Senior Vice President and Corporate Controller
</TABLE>
11
