<PAGE>
===============================================================================
--------------------------------
\ OMB APPROVAL \
\------------------------------\
\ OMB Number: 3235-0059 \
\ Expires: January 31, 2002 \
\ Estimated average burden \
\ hours per response....13.12 \
--------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
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 (S) 240.14a-11(c) or (S) 240.14a-12
PAB BANKSHARES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] 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:
-------------------------------------------------------------------------
Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
<PAGE>
PAB BANKSHARES, INC.
3250 North Valdosta Road
Valdosta, Georgia 31602
(912) 241-2775
--------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held on April 24, 2000
--------
To the Shareholders of PAB Bankshares, Inc.:
The Annual Meeting of Shareholders (the "Annual Meeting") of PAB
Bankshares, Inc. (the "Company") will be held at the Company's offices, 3250
North Valdosta Road, Valdosta, Georgia 31602 on Monday, April 24, 2000 at 11:00
a.m., for the following purposes:
1. To elect (a) five members to the Board of Directors to serve
three year terms expiring at the Annual Meeting of Shareholders
in 2003; (b) one member to the Board of Directors to serve a two
year term expiring at the Annual Meeting of Shareholders in 2002;
and (c) one member to the Board of Directors to serve a one year
term expiring at the Annual Meeting of Shareholders in 2001; and
2. To consider such other business as may properly come before the
Annual Meeting or any postponements or adjournments thereof.
The Board of Directors has set March 10, 2000 as the record date for the
Annual Meeting. Only shareholders of record at the close of business on the
record date will be entitled to notice of and to vote at the Annual Meeting.
By Order of the Board of Directors
/s/ R. Bradford Burnette
------------------------
R. Bradford Burnette
President
Valdosta, Georgia
March 24, 2000
YOUR PROXY IS IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING,
PLEASE VOTE BY COMPLETING, SIGNING AND MAILING THE ENCLOSED PROXY CARD TO THE
COMPANY IN THE ACCOMPANYING ENVELOPE WHICH REQUIRES NO POSTAGE. YOUR PROXY MAY
BE REVOKED, IF YOU CHOOSE, AT ANY TIME PRIOR TO THE VOTE BEING TAKEN AT THE
ANNUAL MEETING.
<PAGE>
PAB BANKSHARES, INC.
3250 North Valdosta Road
Valdosta, Georgia
(912) 241-2775
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To be held on April 24, 2000
GENERAL INFORMATION
This Proxy Statement is being furnished in connection with the solicitation
by the Board of Directors of PAB Bankshares, Inc. (the "Company") of Proxies
from the shareholders of the Company for use at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held on April 24, 2000 at 11:00 a.m.,
local time, at the Company's offices, 3250 North Valdosta Road, Valdosta,
Georgia 31602. The Company operates through its five bank subsidiaries, The
Park Avenue Bank, Farmers & Merchants Bank, First Community Bank of Southwest
Georgia, Eagle Bank and Trust, and Baxley Federal Savings Bank (collectively,
the "Banks"), and its financial services subsidiary, PAB Financial Services,
LLC.
The enclosed Proxy is for use at the Annual Meeting if a shareholder is
unable to attend the Annual Meeting in person or wishes to have his shares voted
by Proxy, even if he attends the Annual Meeting. The Proxy may be revoked by
the person giving it at any time before its exercise, either by notice to the
Secretary of the Company, by submitting a Proxy having a later date, or by such
person appearing at the Annual Meeting and electing to vote in person. All
shares represented by valid Proxies received pursuant to this solicitation and
not revoked before their exercise, will be voted in the manner specified
therein. If a Proxy is signed and no specification is made, the shares
represented by the Proxy will be voted in favor of each of the proposals
described in this Proxy Statement and in accordance with the best judgment of
the persons exercising the Proxy with respect to any other matters properly
presented for action at the Annual Meeting.
This Proxy Statement and the enclosed Proxy are being mailed to the
Company's shareholders on or about March 24, 2000.
The Board of Directors of the Company has set March 10, 2000 as the record
date for the Annual Meeting. Only shareholders of record at the close of
business on the record date will be entitled to notice of and to vote at the
Annual Meeting. As of the record date, there were 9,548,420 shares of common
stock of the Company issued and outstanding.
A quorum for the transaction of business at the Annual Meeting consists of
the holders of the majority of the outstanding shares of common stock of the
Company entitled to vote at the Annual Meeting present in person or represented
by Proxy. Abstentions will be treated as
<PAGE>
present for purposes of determining a quorum. Shares held by a broker as nominee
(i.e., in "street name") that are represented by Proxies at the Annual Meeting,
but that the broker fails to vote on one or more matters as a result of
incomplete instructions from a beneficial owner of the shares ("broker non-
votes"), will also be treated as present for quorum purposes. Each share of
common stock of the Company is entitled to one vote on each matter to come
before the Annual Meeting.
In addition to this solicitation by mail, the officers and employees of the
Company, without additional compensation, may solicit Proxies in favor of the
proposals if deemed necessary, by personal contact, letter, telephone or other
means of communication. Brokers, nominees and other custodians and fiduciaries
will be requested to forward proxy solicitation material to the beneficial
owners of the shares of common stock of the Company where appropriate, and the
Company will reimburse them for their reasonable expenses incurred in connection
with such transmittals. The costs of solicitation of Proxies for the Annual
Meeting will be borne by the Company.
PROPOSAL ONE:
ELECTION OF DIRECTORS
The Company's Board of Directors has nominated (i) five persons for
election as directors at the Annual Meeting to hold office until the 2003 Annual
Meeting of Shareholders, (ii) one person for election as a director at the
Annual Meeting to hold office until the 2002 Annual Meeting of Shareholders, and
(iii) one person for election as a director at the Annual Meeting to hold office
until the 2001 Annual Meeting of Shareholders. Each person nominated shall hold
office until the term of the class of directors for which he has been elected
expires and until his successor is duly elected and qualified, or until his
earlier death, resignation, incapacity to serve, or removal.
The members of the Company's Board of Directors are elected by the
shareholders. The directorships of the Company are divided into three classes,
with the members of each class generally serving three year terms. This year,
however, because of two additions to the Board of Directors occurring since the
last Annual Meeting of Shareholders, two nominees for election as directors at
the Annual Meeting will, if elected, hold office until the Annual Meeting of
Shareholders at which the term of the class of directors for which he has been
chosen expires. The Company's Board of Directors presently consists of 17
members.
The Company's Board of Directors increased in size by two directors in 1999
as a result of the Company's acquisition of Baxley Federal Savings Bank.
Pursuant to the terms of the merger agreement with Baxley Federal Savings Bank,
the Company's Board of Directors increased its size by appointing two former
directors of the bank, Kennith D. McLeod and Alvin R. Tuten, Jr., to serve on
the Company's Board of Directors until the Annual Meeting. In addition, the
Company's Board of Directors has nominated Messrs. McLeod and Tuten for election
as directors at the Annual Meeting, with each to hold office until the term of
the class of directors for which he has been selected expires and until his
successor is duly elected and qualified, or until his earlier death,
resignation, incapacity to serve, or removal.
2
<PAGE>
In an effort to reduce the overall number of its members, and yet increase
the percentage of its non-employee directors, the Company's Board of Directors
has approved and accepted the resignations of several directors, some of whom
have been nominated for election as directors at the Annual Meeting. The
resignations are effective at the 2001 Annual Meeting of Shareholders. The
directors who will resign are employed by either the Company or one of the
Banks.
The following directors have tendered their resignations and will serve
until the 2001 Annual Meeting of Shareholders, regardless of when the term of
the class of directors to which they belong expires:
. William S. Cowart, President and Chief Executive Officer of The Park
Avenue Bank. Mr. Cowart is a member of the class of directors nominated
for election at the Annual Meeting to hold office until the 2002 Annual
Meeting of Shareholders;
. Tracy A. Dixon, Chief Executive Officer of First Community Bank of
Southwest Georgia. Mr. Dixon is a member of the class of directors whose
term expires at the 2002 Annual Meeting of Shareholders;
. Alvin R. Tuten, President and Chief Executive Officer of Baxley Federal
Savings Bank. Mr. Tuten is a member of the class of directors nominated
for election at the Annual Meeting to hold office until the 2001 Annual
Meeting of Shareholders; and
. C. Larry Wilkinson, Executive Vice President of the Company. Mr.
Wilkinson is a member of the class of directors whose term expires at the
2003 Annual Meeting of Shareholders.
As a result of these resignations, all three classes of directors are
expected to have vacancies. Under the Company's Articles of Incorporation and
Bylaws, a director appointed by the Company's Board of Directors to fill a
vacancy occurring in the Board of Directors as a result of a resignation must be
filled by the affirmative vote of a majority of the remaining directors then in
office. A director so chosen will hold office until the term of the class of
directors for which he has been chosen expires. The Company's Board of
Directors does not presently expect to fill the vacancies created as a result of
the resignations described above. The terms of those directors who have not
tendered a resignation in connection with the recomposition of the Company's
Board of Directors will continue as indicated below.
Vote Required
- -------------
If for any reason any nominee should become unable or unwilling to accept
nomination or election, persons voting the Proxies will vote for the election of
another nominee designated by the Company's Board of Directors. Except for the
director resignations discussed above, management of the Company has no reason
to believe that any nominee will not serve, if elected. With regard to the
election of directors, votes may be cast for, or votes may be withheld from,
each nominee. The proposal to elect directors to serve as members of the
Company's Board of Directors requires the affirmative vote of a plurality of the
shares of common stock of the Company present in person or represented by proxy
at the Annual Meeting. Votes that are withheld, abstentions, and broker non-
votes will have no effect on the election of directors.
3
<PAGE>
Nominations for Election and Information Regarding Directors
- ------------------------------------------------------------
Set forth below is information about each nominee for election to a term as
a director and each incumbent director whose term of office expires at the
Annual Meetings of Shareholders in 2001 or 2002.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL TO ELECT AS
DIRECTORS THE NOMINEES NAMED BELOW.
Nominees For Election to Term Expiring at the 2003 Annual Meeting of
- --------------------------------------------------------------------
Shareholders
- ------------
JAMES L. DEWAR, JR.
Director since 1982
Age 57
Mr. Dewar, Jr. has been a director of the Company since 1982 and The Park
Avenue Bank since 1969. Mr. Dewar, Jr. has been the President of Dewar
Properties, Inc. since 1982 and Dewar Realty, Inc. since 1978 and has been
involved in real estate development, construction and management for the past 30
years.
================================================================================
JAMES L. DEWAR, SR.
Director since 1982
Age 88
Mr. Dewar, Sr. has been a senior officer of the Company since January 2000.
Previously, Mr. Dewar, Sr. had been Chairman of the Board of Directors of the
Company since 1982, The Park Avenue Bank since 1967, and Farmers & Merchants
Bank since 1986. Mr. Dewar, Sr. also served as a director of First Community
Bank of Southwest Georgia from 1995 until 2000. Mr. Dewar, Sr. has been
involved in the banking business for the past 42 years.
================================================================================
C. LARRY WILKINSON
Director since 1995
Age 53
Mr. Wilkinson has been Executive Vice President of the Company since 1990.
Previously, Mr. Wilkinson had been Chief Financial Officer of the Company from
1990 to 2000. Mr. Wilkinson served as Executive Vice President and Chief
Financial Officer of The Park Avenue Bank from 1990 to 1997 and Senior Vice
President of The Park Avenue Bank from 1983 to 1990. Mr. Wilkinson also served
as a director of The Park Avenue Bank from 1986 to 2000, Eagle Bank and Trust
from 1999 until 2000, and Farmers & Merchants Bank from 1986 to 2000. Mr.
Wilkinson has more than 33 years of experience in the banking business. As
discussed above, if elected at the Annual Meeting, Mr. Wilkinson will resign
from the Company's Board of Directors at the 2001 Annual Meeting of
Shareholders, creating a vacancy in the class of directors whose term expires at
the 2003 Annual Meeting of Shareholders.
================================================================================
4
<PAGE>
================================================================================
JOE P. SINGLETARY, JR.
Director since 1989
Age 62
Mr. Singletary has been a director of the Company since 1989 and served as
a director of The Park Avenue Bank from 1989 until 1999. Mr. Singletary has
been an executive officer and an owner of Sing Bros., Inc., a gasoline and
wholesale/retail company, since 1974 and Tripo, Inc., a similar business, since
1987. Mr. Singletary has more than 29 years of experience in the gasoline and
wholesale/retail business.
================================================================================
WALTER W. CARROLL, II
Director since 1989
Age 51
Mr. Carroll has been a director of the Company since 1989 and The Park
Avenue Bank since 1989. Mr. Carroll served as an executive officer and an owner
of Sunset Farm Foods, Inc. from 1971 to 1997. Mr. Carroll retired from Sunset
Farm Foods, Inc. in 1997.
================================================================================
Nominee for Election to Term Expiring at 2002 Annual Meeting of Shareholders
- ----------------------------------------------------------------------------
KENNITH D. MCLEOD
Director since 1999
Age 53
Mr. McLeod has been a director of the Company since 1999 and Baxley Federal
Savings Bank since 1985. Mr. McLeod has been a self-employed Certified Public
Accountant in Hazlehurst, Georgia since 1975.
================================================================================
Nominee for Election to Term Expiring at 2001 Annual Meeting of Shareholders
- ----------------------------------------------------------------------------
ALVIN R. TUTEN, JR.
Director since 1999
Age 54
Mr. Tuten has been a director of the Company since 1999 and has been
President and Chief Executive Officer of Baxley Federal Savings Bank since 1987.
Mr. Tuten has served as a director of Baxley Federal Savings Bank since 1980.
As discussed above, if elected at the Annual Meeting, Mr. Tuten will resign from
the Company's Board of Directors at the 2001 Annual Meeting of Shareholders,
creating a vacancy in the class of directors whose term expires at the 2001
Annual Meeting of Shareholders.
================================================================================
5
<PAGE>
Incumbent Directors - Terms Expiring at the 2001 Annual Meeting
- ---------------------------------------------------------------
BILL J. JONES
Director since 1998
Age 71
Mr. Jones has been a director of the Company since 1998 and, since that time,
has served as a director, Vice Chairman, and Chairman of the Loan Committee of
First Community Bank of Southwest Georgia. Mr. Jones was the Chairman of
Investors Financial Corp. and Bainbridge National Bank from 1991 to 1998, when
they were acquired by the Company. In 1987, Mr. Jones retired as President and
Chief Executive Officer of Citizens & Southern National Bank, Decatur County,
after 36 years of experience in the banking business.
================================================================================
JAMES B. LANIER, JR.
Director since 1998
Age 53
Mr. Lanier has been a director of the Company since 1998 and was a founding
director of Eagle Bank and Trust, where he has served as Chairman of the Board
of Directors since 1997. Mr. Lanier also served as Chairman of the Board of
Directors of Eagle Bancorp, Inc. from 1997 to 1998 and was a director from 1990
to 1998, when they were acquired by the Company. Mr. Lanier has been self
employed since 1974, serving as President and owner of Lanier Appraisals, Inc.,
a real estate appraisal firm, and Secretary-Treasurer and a partner in Lanier-
Brookins, Inc., a forestry consulting firm.
================================================================================
JOHN M. SIMMONS
Director since 1998
Age 61
Mr. Simmons has been a director of the Company and First Community Bank of
Southwest Georgia since 1998. Mr. Simmons was a director of Investors Financial
Corp. and Bainbridge National Bank from 1991 to 1998, when they were acquired by
the Company. Mr. Simmons is also the Chairman of the Board of Directors of
Elberta Crate and Box Company and has been employed by Elberta Crate and Box
Company since 1961.
================================================================================
6
<PAGE>
================================================================================
D. RAMSAY SIMMONS, JR.
Director since 1995
Age 68
Mr. Simmons has been a director of the Company since 1995 and First
Community Bank of Southwest Georgia since 1968. He has been Chairman of the
Board of Directors of First Community Bank of Southwest Georgia since 1985. Mr.
Simmons has been President of Elberta Crate and Box Company since 1976.
================================================================================
F. FERRELL SCRUGGS, SR.
Director since 1989
Age 61
Mr. Scruggs has been a director of the Company since 1989 and was a
director of The Park Avenue Bank from 1989 until 1999. Mr. Scruggs has served
as Chairman of the Board of Directors of the Scruggs Company, a construction
business, since 1995 and was President and Chief Operating Officer for 30 years
before. Mr. Scruggs has more than 37 years of experience in the construction
business.
================================================================================
Incumbent Directors Terms Expiring at the 2002 Annual Meeting
- -------------------------------------------------------------
R. BRADFORD BURNETTE
Director since 1982
Age 60
Mr. Burnette has been President, Chief Executive Officer and a director of
the Company since 1982. Mr. Burnette was elected Chairman of the Board of
Directors of the Company in February 2000. Mr. Burnette was the Chief Executive
Officer of The Park Avenue Bank from 1990 to 1997, the President from 1983 to
1990, and an Executive Vice President from 1968 to 1982. He was a director of
The Park Avenue Bank from 1968 until 2000, the Farmers & Merchants Bank from
1986 until 2000, Eagle Bank and Trust from 1999 until 2000, and First Community
Bank of Southwest Georgia from 1995 until 2000, where he was Chief Executive
Officer from 1996 to 1998. Mr. Burnette has been a director of The Bankers Bank
since 1990. Mr. Burnette has more than 34 years of experience in the banking
business.
================================================================================
7
<PAGE>
================================================================================
WILLIAM S. COWART
Director since 1990
Age 46
Mr. Cowart has been a director of the Company since 1990 and The Park
Avenue Bank since 1990. Mr. Cowart has been President of The Park Avenue Bank
since 1990 and Chief Executive Officer since 1997. Previously, Mr. Cowart
served as President of the First Union National Bank, Valdosta, Georgia. Mr.
Cowart has over 24 years of experience in the banking business. As discussed
above, Mr. Cowart will resign from the Company's Board of Directors at the 2001
Annual Meeting of Shareholders, creating a vacancy in the class of directors
whose term expires at the 2002 Annual Meeting of Shareholders.
================================================================================
THOMPSON KURRIE, JR.
Director since 1989
Age 51
Mr. Kurrie has been a director of the Company since 1989 and The Park
Avenue Bank since 1989. Mr. Kurrie is a partner with the law firm of Coleman,
Talley, Newbern, Kurrie, Preston & Holland where he has practiced law since
1985. Mr. Kurrie is also a certified public accountant, having previously
served as a partner in the accounting firm of PricewaterhouseCoopers from 1976
to 1983.
================================================================================
PAUL E. PARKER
Director since 1998
Age 51
Mr. Parker has been a director of the Company since 1998 and Eagle Bank and
Trust since its founding in 1990. Mr. Parker served as Vice Chairman of the
Board of Directors of Eagle Bank and Trust from 1991 to 1994 and from 1997 to
the present. Mr. Parker also served as a director and Vice Chairman of the
Board of Directors of Eagle Bancorp, Inc. from 1990 to 1998, when it was
acquired by the Company. Mr. Parker has served as the Vice President of Claxton
Bakery, Inc., a family owned wholesale bakery, since 1970 and served as a
director of The Claxton Bank since 1977 and Southern Bankshares, Inc. since
1998.
================================================================================
8
<PAGE>
================================================================================
TRACY A. DIXON
Director since 1998
Age 58
Mr. Dixon has been a director of the Company and First Community Bank of
Southwest Georgia since the Company acquired Investors Financial Corp. in 1998.
Mr. Dixon also has served as Chief Executive Officer of First Community Bank of
Southwest Georgia since August 1998. Mr. Dixon served as director and President
and Chief Executive Officer of Investors Financial Corp. and Bainbridge National
Bank from 1991 to 1998, when they were acquired by the Company. Mr. Dixon has
34 years of experience in the banking business. As discussed above, Mr. Dixon
will resign from the Company's Board of Directors at the 2001 Annual Meeting of
Shareholders, creating a vacancy in the class of directors whose term expires at
the 2002 Annual Meeting of Shareholders.
================================================================================
There are no family relationships between any of the directors or executive
officers of the Company or the Banks, except for the following: James L. Dewar,
Jr., is the son of James L. Dewar, Sr.; Jeff Hanson, President of First
Community Bank of Southwest Georgia, is the son-in-law of R. Bradford Burnette;
D. Ramsay Simmons, Jr. is the brother of John M. Simmons; F. Ferrell Scruggs,
Sr. is the brother of J. Kenneth Scruggs, Jr., a director of The Park Avenue
Bank and the father of F. Ferrell Scruggs, Jr., a director of The Park Avenue
Bank; Joe P. Singletary, Jr. is the father of Joe P. Singletary, III, a director
of The Park Avenue Bank; Paul E. Parker is the brother of W. Dale Parker, a
director of Eagle Bank and Trust; and James B. Lanier, Jr. is a cousin of the
late husband of Betty K. Minick, a director of Eagle Bank and Trust.
OTHER MATTERS
At the time of the preparation of this Proxy Statement, the Company was not
aware of any matters to be presented for action at the Annual Meeting other than
the proposals referred to herein. If other matters are properly presented for
action at the Annual Meeting, it is intended that the persons named as Proxies
will vote or refrain from voting in accordance with their best judgment on such
matters.
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors of the Company had 12 meetings during the 1999
fiscal year.
The Board of Directors has an Audit Committee and a Compensation Committee.
The Audit Committee consists of three members and had four meetings during the
1999 fiscal year. The Audit Committee reviews the scope and timing of the audit
services of the Company's independent accountants and any other services such
accountants are asked to perform. In addition, the Audit Committee reviews the
independent accountants' report on the Company's financial statements and the
Company's policies and procedures with respect to internal accounting and
financial controls. The current members of the Audit Committee are Walter W.
9
<PAGE>
Carroll, II, Bill J. Jones, and Paul E. Parker. D. Ramsay Simmons, Jr. and
Thompson Kurrie, Jr. also served on the Audit Committee through April of 1999.
The Compensation Committee consists of four members and had three meetings
during the 1999 fiscal year. The Compensation Committee reviews and recommends
to the Board of Directors the compensation and benefits of all officers of the
Company, and reviews general policy matters relating to compensation and
benefits of employees of the Company. The members of the Compensation Committee
are Walter W. Carroll, II, Thompson Kurrie, Jr., John M. Simmons, and Joe P.
Singletary, Jr.
Except for C. Larry Wilkinson, who resigned his seat in 1994 pursuant to a
reorganization of the Company's Board of Directors and returned to the Board of
Directors in 1995, all directors have served continuously since their first
election. Each director attended at least 75% of the meetings of the Board of
Directors and the meetings of the committees of which he was a member in 1999.
EXECUTIVE OFFICERS OF THE COMPANY
The executive officers of the Company are elected annually and serve at the
pleasure of the Board of Directors. The following sets forth certain
information with respect to the executive officers of the Company.
R. Bradford Burnette, age 60, has served as President, Chief Executive
Officer, and a director of the Company since 1982. Mr. Burnette began serving
as Chairman of the Board of Directors of the Company in February 2000. See
"Proposal One: Election of Directors" for further biographical information
concerning Mr. Burnette.
C. Larry Wilkinson, age 53, has served as Executive Vice President of the
Company since 1990 and a director of the Company since 1986. See "Proposal One:
Election of Directors" for further biographical information concerning Mr.
Wilkinson.
William S. Cowart, age 46, has served as President since 1990 and Chief
Executive Officer since 1997 of The Park Avenue Bank, and a director of the
Company since 1990. See "Proposal One: Election of Directors" for further
biographical information concerning Mr. Cowart.
Tracy A. Dixon, age 58, has served as Chief Executive Officer of First
Community Bank of Southwest Georgia and a director or the Company since 1998.
See "Proposal One: Election of Directors" for further biographical information
concerning Mr. Dixon.
Michael E. Ricketson, age 50, has served as Executive Vice President, Chief
Financial Officer and Treasurer of the Company since February 1, 2000.
Previously, Mr. Ricketson had been Chief Financial Officer of Premier
Bancshares, Inc. ("Premier") from June 1997 until Premier's acquisition by BB&T
Corporation in January of 2000. Prior to Premier's merger with Central and
Southern Holding Company ("Central and Southern") in June 1997, Mr. Ricketson
had served as Executive Vice President and a director of Central and Southern
since 1996 and
10
<PAGE>
Chief Financial Officer of its wholly-owned subsidiary, Central and Southern
Bank, since October 1993.
EXECUTIVE COMPENSATION
Report of the Compensation Committee on Executive Compensation
- --------------------------------------------------------------
In accordance with rules of the Securities and Exchange Commission (the
"Commission"), the Compensation Committee of the Board of Directors of the
Company (the "Compensation Committee") is providing the following report
regarding compensation policies for the Company's Chief Executive Officer and
other executive officers with respect to compensation paid to such persons
during the last fiscal year.
During 1999, the Compensation Committee was comprised of Walter W. Carroll,
II, Thompson Kurrie, Jr., John M. Simmons, and Joe P. Singletary, Jr., each a
non-employee director of the Company. It is the Compensation Committee's
responsibility to establish the salaries, bonuses and other compensation of the
Chief Executive Officer and other executive officers of the Company and its
banking subsidiaries. In formulating its compensation policy and decisions, the
Compensation Committee engages the services of Matthews, Young and Associates,
Inc. ("Matthews, Young"), a management consulting firm. The Compensation
Committee endeavors to provide a competitive compensation package that enables
the Company to attract and retain key executives. Further, the Compensation
Committee strives to integrate its compensation programs with the Company's
annual and long-term business strategies and objectives and focus executive
actions on the fulfillment of those objectives.
The Company's executive compensation program generally consists of base
salary, annual incentive compensation and long-term equity incentives in the
form of stock options. With respect to the base salary of the Company's
executive officers, the Compensation Committee utilizes a report prepared by
Matthews, Young and selects a salary based on a combination of grade and salary
level set forth in the report. Base salaries are not based on the performance
of the Company, but are rather intended to be commensurate with salaries paid to
similarly situated executive officers. With respect to the base salaries of the
executive officers of the Banks, the Compensation Committee employs a similar
methodology.
In order to align the interests of management more closely with the
interests of the shareholders of the Company, the Compensation Committee also
employs performance based measures in the form of both short-term and long-term
incentive compensation awards. The Compensation Committee utilizes an annual
incentive award in the form of a cash bonus for the Chief Executive Officer and
the Chief Financial Officer of the Company. The maximum amount of this bonus,
as a percentage of base salary, is determined by reference to a selected grade
in the Matthews, Young report. The actual amount of the bonus is calculated as
a percentage of base salary, which percentage depends on the percentage growth
in earnings per share of the Company based on a formula defined annually by the
Compensation Committee. The executive officers of the Banks, on the other hand,
receive annual incentive bonuses which are based in part on the recommendation
of the Company's Chief Executive Officer and are tied
11
<PAGE>
not to the performance of the Company, but rather to the return on assets,
return on equity, growth of assets, and net income of their respective Bank.
Finally, the Company's long-term incentive program emphasizes the grant of
stock options exercisable for shares of the Company's common stock. Stock
options are awarded by the Company's Board of Directors after taking into
account various factors, including the achievement of performance goals set by
the Compensation Committee and the need to retain individuals who will perform
valuable service to the Company.
As of January 1, 1999, the Company entered into an employment agreement
with its Chief Executive Officer, R. Bradford Burnette. The employment
agreement was negotiated between counsel for the Company and counsel for Mr.
Burnette. The base salary of Mr. Burnette in 1999 was $201,300, which was
determined to be appropriate based on the Matthews, Young report. In
determining the appropriateness of Mr. Burnette's salary, Matthews, Young relied
on a combination of grade and salary levels it believed to be commensurate with
the salaries of similarly situated chief executive officers. Mr. Burnette's
annual incentive bonus for the past year equaled 30.6% of his base salary, which
percentage was calculated under the formula set by the Compensation Committee
based on a 9.9% increase in the Company's diluted earnings per share during the
year. Additionally, Mr. Burnette was granted 3,000 options during 1999, of
which 20% was exercisable as of December 31, 1999.
The Compensation Committee considered the salaries and bonuses of all of
the executive officers of the Company and the Banks to be commensurate with
those paid to similarly positioned executives in similar companies. Information
on salaries for comparable executives is provided by Matthews, Young in the form
of grades, annual base salary and incentive awards.
The Compensation Committee believes that its mix of market-based salaries,
variable incentives for both long-term and short-term performance and the
potential for equity ownership in the Company represents a balance that will
motivate the management team to continue to produce strong returns. The
Compensation Committee further believes this program strikes an appropriate
balance between the interests and needs of the Company in operating its business
and appropriate rewards based on shareholder value.
Submitted by the Compensation Committee.
Walter W. Carroll, II John M. Simmons
Thompson Kurrie, Jr. Joe P. Singletary, Jr.
12
<PAGE>
Summary Compensation Table
- --------------------------
The following table sets forth a summary of compensation paid to or accrued
on behalf of the chief executive officer and the other executive officers of the
Company whose aggregate compensation exceeded $100,000 for services rendered
during the 1999 fiscal year.
<TABLE>
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
---------------------------------------------- -------------
Securities
Name and Other Annual Underlying All Other
Principal Fiscal Compensation Options Compensation
Position Year Salary ($) Bonus ($) ($)(1) (#)(2) ($)(3)
- -------------------- --------- ---------- ------------- ------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
R. Bradford Burnette 1999 201,300 61,598 22,250 3,000 70,890
President and CEO 1998 178,000 56,960 16,800 2,000 67,508
of the Company 1997 159,600 51,040 16,350 30,000 60,328
C. Larry Wilkinson 1999 131,758 33,598 18,675 3,000 31,454
Executive Vice 1998 113,000 29,380 12,900 2,000 27,980
President of the 1997 100,420 26,000 11,050 20,000 24,499
Company
William S. Cowart 1999 125,814 34,102 10,200 3,000 25,653
President of The 1998 113,000 27,067 10,275 2,000 23,137
Park Avenue 1997 106,400 27,560 8,900 20,000 20,933
Bank (a subsidiary
of the Company)
Tracy A. Dixon 1999 110,000 10,000 10,200 1,000 11,222
Chief Executive 1998 104,000 19,232 6,600 1,000 2,773
Officer of First 1997 99,961 6,200 1,500 -0- 2,468
Community Bank
of Southwest
Georgia (a
subsidiary of
the Company)
Alvin R. Tuten, Jr. 1999 90,520 7,543 3,600 1,000 1,943
President of Baxley 1998 87,880 7,323 3,000 -0- 47,747
Federal Savings 1997 84,500 8,450 3,100 -0- 18,037
Bank (a subsidiary
of the Company)
</TABLE>
- ------------------
(1) The reported amount consists of director's fees. Compensation does not
include any perquisites and other personal benefits which may be derived
from business-related expenditures that in the aggregate do not exceed the
lesser of $50,000 or 10% of the total annual salary and bonus reported for
such person.
(2) The options have been adjusted to reflect a two-for-one stock split in
1998.
(3) The reported amount consists of the Company's or the Banks' contribution to
a Profit Sharing Plan and a Section 401(K) Plan, as well as amounts accrued
under a Salary Continuation Plan. With respect to 1999, the reported
amount also includes compensation paid to the named individuals ($1,000
each) in the form of two shares of preferred stock of real estate
investment trusts established by two of the Banks. Each share
13
<PAGE>
of preferred stock has a liquidation value of $500. Additionally, the
amounts for Mr. Tuten for 1998 and 1997 include amounts contributed to the
ESOP Plan of Baxley Federal Savings Bank by the savings bank.
Option Grants Table
- -------------------
The following table sets forth certain information regarding the grant of
stock options during the 1999 fiscal year to the persons named in the Summary
Compensation Table and the value of such options held by such persons at the end
of the 1999 fiscal year.
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
Individual Grants
- -------------------------------------------------------------------------------
Potential Realizable
Number of % of Total Value at Assumed
Securities Options Exercise Annual Rates of Stock
Underlying Granted to or Base Price Appreciation for
Options Employees in Price Option Term(1)
Name Granted(2) Fiscal Year ($/Sh) Expiration Date 5%($) 10%($)
- ---------------- ----------- -------------- ---------- ----------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
R. Bradford
Burnette 3,000 2.48 17.81 February 8, 2009 33,608 85,168
C. Larry
Wilkinson 3,000 2.48 17.81 February 8, 2009 33,608 85,168
William S.
Cowart 3,000 2.48 17.81 February 8, 2009 33,608 85,168
Tracy A. Dixon 1,000 0.83 17.81 February 8, 2009 11,203 28,389
Alvin R. Tuten, Jr. 1,000 0.83 14.88 November 30, 2009 9,355 23,707
</TABLE>
- ------------
(1) Based on actual option term and annual compounding. These amounts are
calculated pursuant to applicable requirements of the Commission and do not
represent a forecast of the future appreciation of the common stock.
(2) Mr. Burnette's options may be exercised in varying amounts over a four year
period beginning in 1999. Options granted to the other optionees may be
exercised in five annual installments beginning with the first anniversary
following the date of grant.
14
<PAGE>
Option Exercise and Fiscal Year-End Option Value Table
- ------------------------------------------------------
The following table sets forth certain information regarding the exercise
of stock options during the 1999 fiscal year by the persons named in the Summary
Compensation Table and the value of options held by such persons at the end of
such fiscal year.
<TABLE>
<CAPTION>
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
Individual Grants
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options
Shares Acquired Options at FY-End (#)(1) at FY-End ($)(2)
Name on Exercise (#) Value Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
- ------------------ ---------------- ------------------- ------------------------- -----------------------------
<S> <C> <C> <C> <C>
R. Bradford Burnette 0 0 52,882/21,118 324,926/57,690
C. Larry Wilkinson 0 0 25,200/27,800 145,184/120,146
William S. Cowart 0 0 25,200/27,800 145,184/120,146
Tracy A. Dixon 0 0 200/1,800 0/0
Alvin R. Tuten, Jr. 0 0 0/1,000 0/0
</TABLE>
- -----------
(1) The options have been adjusted to reflect a two-for-one stock split in
1998.
(2) Market value of underlying securities at year end ($13.313), minus the
option exercise price.
Director Compensation
- ---------------------
The directors of the Company are paid directors' fees of $3,000 per annum
plus $300 per meeting for attendance at meetings of the Company's Board of
Directors and $100 per meeting for attendance at meetings of committees of the
Company's Board of Directors.
Directors Deferred Stock Purchase Plan
- --------------------------------------
On April 18, 1994, the Company's shareholders approved the Directors
Deferred Stock Purchase Plan (the "Director Plan"), which provided that a
director of the Company or any subsidiary could elect to receive shares of
common stock of the Company in lieu of the cash compensation otherwise payable
as director's fees for services as a member of the Board of Directors of the
Company (or any of its subsidiaries) or any committee thereof. The shares of
common stock issuable to an electing director under the Director Plan were
required to be issued on January 15 following each fiscal year in a whole number
(rounded down) resulting from the amount of such director's fees (or a portion
thereof as determined by such director) for such previous fiscal year divided by
100% of the fair market value of the common stock as of January 1 of such
previous fiscal year. The Board of Directors of the Company administered the
Director Plan and was required to determine the fair market value of the common
stock as soon as practicable following January 1 of each fiscal year. The
Director Plan covered 100,000 shares of common stock which were authorized for
issuance and delivery thereunder.
15
<PAGE>
The Board of Directors determined that the fair market value of the common
stock of the Company as of January 1, 1998 was $12.06 per share for purposes of
calculations for the 1998 fiscal year under the Director Plan. Effective
January 15, 1999, the Company issued, in the aggregate, 9,503 shares of common
stock to 18 electing directors of the Company and the Banks under the Director
Plan for fiscal year 1998. The directors of the Company electing to receive
shares of common stock in lieu of fees were Walter W. Carroll, II (1,216
shares), James L. Dewar, Jr. (1,139 shares), Thompson Kurrie, Jr. (893 shares),
F. Ferrell Scruggs, Sr. (1,108 shares), D. Ramsay Simmons, Jr. (538 shares), and
Joe P. Singletary (1,218 shares). The Director Plan expired on January 15,
1999.
Employment Agreements
- ---------------------
R. Bradford Burnette. As of January 1, 1999, the Company entered into an
employment agreement with R. Bradford Burnette. Under the employment agreement,
Mr. Burnette serves as President and Chief Executive Officer of the Company and
is entitled to receive an annual base salary of $201,300. Mr. Burnette's base
salary is subject to normal annual increases, and bonuses as shall be determined
by the Company's Board of Directors from time to time. The employment agreement
runs for 36 months and will be automatically extended for 12-month periods
unless either of the parties gives notice that it should not be extended. In
the event Mr. Burnette's employment is terminated (i) by the Company other than
for "cause" (such as a material breach of the employment agreement, gross
negligence, or willful misconduct), (ii) by Mr. Burnette for "good reason" (such
as a material change in his duties, a reduction in compensation, or a required
relocation of more than 50 miles from the Company's main office), or (iii) due
to the Company's breach of the employment agreement, Mr. Burnette will be
entitled to continue to receive the same amount of compensation and benefits
paid to him during the previous 12 months. In such case, Mr. Burnette would be
paid compensation and benefits for a period equal to the greater of the
remaining term of his employment agreement or 12 months.
In the event of a change in control of the Company, Mr. Burnette shall be
entitled, for a period of 90 days after the change in control, and at his
election, to deliver notice to the Company (i) of the termination of the
employment agreement, whereupon the Company shall continue to pay Mr. Burnette
his base salary for six months, or (ii) that he intends to remain in the employ
of the Company, whereupon the Company shall employ Mr. Burnette for a period
equal to the greater of the remaining term of his employment agreement or 12
months.
In the event of a change in control of the Company followed by a (i)
reduction in Mr. Burnette's compensation, (ii) material change in Mr. Burnette's
status, title, or duties, (iii) failure by the Company to increase Mr.
Burnette's salary in accordance with established procedure, or (iv) required
relocation by Mr. Burnette of more than 50 miles from the Company's main office,
Mr. Burnette will be entitled to receive severance benefits in a lump sum cash
amount equal to approximately three times his total annual compensation for the
fiscal year in which his compensation was highest.
16
<PAGE>
Mr. Burnette's employment agreement restricts Mr. Burnette from, among
other things, (i) disclosing trade secrets, (ii) competing with the Company or
the Banks within a 100-mile radius of the Company's main office for 24 months
following termination, and (iii) employing any former employee of the Company or
the Banks for 12 months following the employee's termination.
C. Larry Wilkinson. As of January 1, 1999, the Company entered into an
employment agreement with C. Larry Wilkinson. Under the employment agreement,
Mr. Wilkinson serves as Executive Vice President of the Company and is entitled
to receive an annual base salary of $131,758. The remainder of Mr. Wilkinson's
employment agreement is substantially similar to the Company's employment
agreement with Mr. Burnette.
William S. Cowart. As of January 1, 1999, the Company and The Park Avenue
Bank entered into an employment agreement with William S. Cowart. Under the
employment agreement, Mr. Cowart serves as President and Chief Executive Officer
of The Park Avenue Bank, the Company's largest bank subsidiary, and is entitled
to receive an annual base salary of $125,814. The remainder of Mr. Cowart's
employment agreement is substantially similar to the Company's employment
agreement with Mr. Burnette.
Tracy A. Dixon. In connection with the Company's acquisition of Investors
in 1998, First Community Bank of Southwest Georgia, a subsidiary of the Company,
entered into an employment agreement with Tracy A. Dixon pursuant to which Mr.
Dixon serves as Chief Executive Officer of the bank. Under the employment
agreement, which runs for 36 months from June 19, 1998, Mr. Dixon is entitled to
receive an annual base salary of $110,000. The remainder of Mr. Dixon's
employment agreement is substantially similar to the Company's employment
agreement with Mr. Burnette.
Alvin R. Tuten, Jr. In connection with the Company's acquisition of
Baxley Federal Savings Bank in 1999, the bank entered into an employment
agreement with Alvin R. Tuten, Jr. pursuant to which Mr. Tuten serves as
President and Chief Executive Officer of the bank. Under the employment
agreement, which runs for 36 months from November 30, 1999, Mr. Tuten is
entitled to receive an annual base salary of $90,520. The non-competition and
non-solicitation provisions contained in Mr. Tuten's employment agreement
prevent Mr. Tuten from competing with the Banks within a 50-mile radius of
Baxley Federal Savings Bank's offices and employing any former employee of the
Company or the Banks for 24 months following the employee's termination. In the
event of a change in control of the Company, Mr. Tuten shall be entitled, for a
period of 30 days after the change in control, to terminate his employment
agreement or remain in the employ of Baxley Federal Savings Bank. The remainder
of Mr. Tuten's employment agreement is substantially similar to the Company's
employment agreement with Mr. Burnette.
Salary Continuation Plan
- -------------------------
Effective January 1, 1994, the Company adopted a Salary Continuation Plan
which provides for benefits upon death, disability, or retirement of certain
executive officers of the Company and the Banks, including R. Bradford Burnette,
C. Larry Wilkinson, and William S. Cowart. Pursuant to this plan, The Park
Avenue Bank has entered into individual agreements
17
<PAGE>
with Messrs. Burnette, Wilkinson, and Cowart. Upon retirement, a covered
executive whose benefits are fully vested is entitled to receive monthly
payments in an annual amount equal to 40% of the average annual salary paid or
payable to such employee for the three year period immediately preceding his or
her retirement. The payments to which a covered executive is entitled continue
for a period of 15 years. The Salary Continuation Plan has a progressive vesting
schedule, commencing with the date upon which an employee becomes covered by the
plan and ending with his or her projected date of retirement (at age 65). No
employee of the Company or the Banks currently has benefits which are fully
vested.
In the event a covered executive should die or become permanently disabled
while employed by the Company or the relevant Bank prior to retirement, the
Salary Continuation Plan provides for monthly payments for 15 years to the
executive in an annual amount equal to 40% of his or her average annual salary
for the three years immediately preceding death or disability. Should the
employment of a covered executive be terminated without cause by the Company or
the relevant Bank or voluntarily by the executive, the executive is entitled to
receive monthly payments for 15 years in a total amount equal to a vested
percentage amount (based on the number of years that the executive has been
covered by the plan) multiplied by the liability accrued for that executive's
retirement payments. If the executive is terminated without cause within two
years following a change in control of the Company or the relevant Bank,
however, the executive may choose to receive payments in a total amount equal to
the liability accrued for his or her retirement payments as of the end of the
preceding year. In the event a covered executive who is terminated for cause
or, during the three year period following his or her retirement or voluntary
termination, engages in the business of banking in Lowndes County, Georgia, then
the Company and the Banks will have no further obligation under the Salary
Continuation Plan with respect to that executive.
The estimated annual benefits payable to the executive officers named in
the Summary Compensation Table, assuming retirement at age 65, are as follows:
R. Bradford Burnette, $76,958; C. Larry Wilkinson, $66,578; and William S.
Cowart, $118,040. Although the Salary Continuation Plan does not require the
Company or the Banks to set aside any assets in order to fund the obligations
arising thereunder, the Company has utilized life insurance policies as the
primary funding source. As of December 31, 1999, the aggregate cash value of
these policies for the three named individuals was $1,121,991, and the liability
accrued for benefits payable to them under the Salary Continuation Plan was
$401,793.
Stock Option Plans
- ------------------
1994 Stock Option Plan
----------------------
On April 18, 1994, the Company's shareholders approved the 1994 Employee
Stock Option Plan (the "1994 Plan"), which provides for the grant of options to
purchase shares of the Company's common stock to the employees of the Company.
The 1994 Plan serves as an employee incentive and encourages the continued
employment of key personnel by facilitating their purchase of an equity interest
in the Company. The 1994 Plan is administered by the Board of Directors of the
Company, which has the authority to select recipients, designate the number of
shares to be covered by each option, and, subject to certain restrictions,
specify the terms of
18
<PAGE>
the options. The 1994 Plan provides for the granting of both "incentive stock
options" and "nonqualified stock options." The exercise price for each incentive
stock option granted under the 1994 Plan shall in no event be less than 100% of
the fair market value of the Company's common stock on the date of grant and no
stock option shall be exercisable after the expiration of ten years from the
date of grant. The 1994 Plan covers 400,000 shares of the Company's common
stock, which may be authorized for issuance and delivery by the exercise of
options granted thereunder. The Company granted options to acquire an aggregate
of 49,750 shares to 51 employees under the 1994 Plan in fiscal year 1999 and an
additional aggregate of 27,600 shares to 35 employees subsequent to December 31,
1999. As of March 1, 2000, 117 shares of the Company's common stock were still
available for grants under the 1994 Plan.
1999 Stock Option Plan
----------------------
On April 26, 1999, the Company's shareholders approved the 1999 Stock
Option Plan (the "1999 Plan"), which provides for the grant of options to
purchase shares of the Company's common stock to the Company's and its
affiliates' directors, employees, consultants and advisors. The purpose of the
1999 Plan is to maximize the long-term success of the Company, to ensure a
balanced emphasis on both current and long-term performance, to enhance
participants' identification with shareholders' interests and to facilitate the
attraction and retention of key individuals with outstanding abilities. The
1999 Plan is administered by the Board of Directors of the Company, which has
the authority to select recipients, designate the number of shares to be covered
by each option, and, subject to certain restrictions, specify the terms of the
options. Like the 1994 Plan, the 1999 Plan provides for the granting of both
"incentive stock options" and "nonqualified stock options." The exercise price
for each incentive stock option granted under the 1999 Plan shall in no event be
less than 100% of the fair market value of the Company's common stock on the
date of grant and no stock option shall be exercisable after the expiration of
ten years from the date of grant. The 1999 Plan covers 600,000 shares of common
stock, which may be authorized for issuance and delivery by the exercise of
options granted thereunder. The Company granted options to acquire an aggregate
of 72,000 shares to ten directors and employees under the 1999 Plan in fiscal
year 1999 and an additional aggregate of 60,350 shares to 43 directors and
employees subsequent to December 31, 1999. As of March 1, 2000, 467,650 shares
of the Company's common stock were still available for grants under the 1999
Plan.
Other Compensation Plans
- ------------------------
During 1999, two of the Banks established real estate investment trusts
("REITs"). In connection with the formation of the REITs, preferred shares of
the REITs were granted to over 100 directors and employees of the Company, the
Banks and their affiliates. Each person who received preferred shares received
one share of each REIT. The preferred shares have no voting rights, except those
which may be required by law. Each preferred share is expected to have an annual
dividend of $40.00. The distribution of the preferred shares by the REITs was
treated as compensation and was taxable to the recipients. The compensation
attributable to each recipient totaled $1,000, representing the aggregate
liquidation value of the two preferred shares.
19
<PAGE>
Compensation Committee Interlocks and Insider Participation
- -----------------------------------------------------------
The members of the Compensation Committee of the Company during 1999 were
Walter W. Carroll, II, Thompson Kurrie, Jr., John M. Simmons and Joe P.
Singletary, Jr. The Company utilizes the law firm of Coleman, Talley, Newbern,
Kurrie, Preston & Holland to provide legal services to the Company and the
Banks, 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 legal fees earned in connection with loan closings, which fees are
collected from the persons making the loans from the Banks. Mr. Kurrie is a
partner in the law firm. The Company believes the services obtained from Mr.
Kurrie's firm are on terms as favorable to the Company as could have been
obtained from unaffiliated parties.
20
<PAGE>
SHAREHOLDER RETURN PERFORMANCE GRAPH
The following graph compares the Company's yearly percentage change in
cumulative, five-year shareholder return with the Nasdaq Market Index and The
Carson Medlin Company's Independent Bank Index (the "Independent Bank Index").
The Independent Bank Index is a compilation of the total shareholder return of
23 independent community banks located in the southeastern states of Alabama,
Florida, Georgia, North Carolina, South Carolina, Tennessee, Virginia, and West
Virginia. The graph assumes that the value of the investment in the Company's
common stock and in each index was $100 on December 31, 1994 and that all
dividends were reinvested. The change in cumulative total return is measured by
dividing (i) the sum of (a) the cumulative amount of dividends for the period,
and (b) the change in share price between the beginning and end of the period,
by (ii) the share price at the beginning of the period.
[PAB BANKSHARES GRAPH APPEARS HERE]
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
PAB BANKSHARES, INC. 100 126 211 242 378 277
INDEPENDENT BANK INDEX 100 122 155 235 246 222
NASDAQ INDEX 100 141 174 213 300 542
21
<PAGE>
COMPLIANCE WITH SECTION 16(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended ("Section
16(a)") requires the Company's officers and directors, and persons who own 10%
or more of the registered class of the Company's equity securities, to file with
the Commission initial reports of ownership and reports of changes in ownership
of common stock and other equity securities of the Company. Officers, directors
and 10% or more shareholders are required by regulations of the Commission to
furnish the Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company during fiscal year 1999, all directors,
officers and 10% shareholders complied with all Section 16(a) filing
requirements.
22
<PAGE>
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information regarding the shares of
the Company's common stock owned as of March 1, 2000, (i) by each person who
beneficially owned more than 5% of the shares of the Company's common stock,
(ii) by each of the Company's directors and executive officers named in the
Summary Compensation Table, and (iii) by all of the Company's directors and
executive officers as a group.
<TABLE>
<CAPTION>
Number of Percentage
Name of Beneficial Owner(1) Shares Ownership(2)
- ----------------------------------------------------- -------------------- --------------------------
<S> <C> <C>
R. Bradford Burnette 260,150(3) 2.70
Walter W. Carroll, II 86,267(4) *
William S. Cowart 54,502(5) *
Dewar Family, L.P. 1,117,026(6) 11.70
P. O. Box 2995
Valdosta, Georgia 31604
James L. Dewar, Jr. 1,508,959(7) 15.80
James L. Dewar, Sr. 1,118,926(8) 11.70
Tracy A. Dixon 89,348(9) *
Bill J. Jones 156,633(10) 1.64
Thompson Kurrie, Jr. 30,407(11) *
James B. Lanier, Jr. 17,049(12) *
Kenneth D. McLeod 66,854 *
Paul E. Parker 24,500(13) *
F. Ferrell Scruggs, Sr. 98,988(14) 1.03
D. Ramsay Simmons, Jr. 97,650(15) 1.02
John M. Simmons 134,279(16) 1.40
Joe P. Singletary, Jr. 109,341(17) 1.14
Alvin R. Tuten, Jr. 66,202 *
C. Larry Wilkinson 102,678(18) 1.07
All directors and executive officers as a group 2,906,804 30.34
(18 persons)
</TABLE>
____________________
*Less than 1%.
23
<PAGE>
(1) Under the rules of the Commission, a person is deemed to be a beneficial
owner of a security if he or she has or shares the power to vote or to
direct the voting of such security, or the power to dispose or to direct
the disposition of such security. A person is also deemed to be a
beneficial owner of any securities that such person has the right to
acquire beneficial ownership of within 60 days as well as any securities
owned by such person's spouse, children or relatives living in the same
household. Accordingly, more than one person may be deemed to be a
beneficial owner of the same securities. Except as otherwise indicated,
the persons named in the above table have sole voting and investment power
with respect to all shares shown as beneficially owned by them. The
information as to beneficial ownership has been furnished by the respective
persons listed in the above table.
(2) Based on 9,571,525 shares outstanding as of March 1, 2000. Shares
underlying outstanding stock options or warrants held by the person
indicated and exercisable within 60 days of such date are deemed to be
outstanding for purposes of calculating the percentage owned by such
holder.
(3) Includes 9,310 shares held by Mr. Burnette's wife, of which shares Mr.
Burnette disclaims beneficial ownership. Also includes 62,379 vested stock
options granted to Mr. Burnette and 16,857 shares held in the name of the
Company's Employee 401(K) Plan, as to which shares Mr. Burnette has sole
voting power and shared investment power. Further includes 100,000 shares
owned by a family limited partnership with Mr. Burnette and his spouse as
general partners possessing shared investment power and voting power.
(4) Includes 1,148 shares held by Mr. Carroll's wife, of which shares Mr.
Carroll disclaims beneficial ownership, and 9,165 shares held by Mr.
Carroll's minor children.
(5) Includes 35,800 vested stock options granted to Mr. Cowart. Also includes
100 shares held by Mr. Cowart's minor children.
(6) The Dewar Family, L.P. is a limited partnership with Messrs. Dewar, Sr. and
Dewar, Jr. as its general partners possessing shared investment power and
each possessing voting power as to certain shares owned by the limited
partnership. The mailing address of the Dewar Family, L.P. is P. O. Box
2995, Valdosta, Georgia 31604.
(7) Includes 1,117,026 shares owned by the Dewar Family, L.P. Mr. Dewar, Jr.
is a general partner of the Dewar Family, L.P. and possesses shared
investment power as to all shares owned by the limited partnership and the
power to vote 563,354 shares owned by the limited partnership. Includes
47,950 shares which are held by Mr. Dewar, Jr.'s wife, of which shares Mr.
Dewar, Jr. disclaims beneficial ownership. The mailing address of Mr.
Dewar, Jr. is P. O. Box 2995, Valdosta, Georgia 31604.
(8) Includes 1,117,026 shares owned by the Dewar Family, L.P., a family trust.
Mr. Dewar, Sr. is a general partner of the Dewar Family, L.P. and possesses
shared investment power as to all shares owned by the limited partnership
and the power to vote 553,672 shares owned by the limited partnership.
Includes 1,000 shares owned by Mr. Dewar, Sr.'s wife, of which shares Mr.
Dewar, Sr. disclaims beneficial ownership. The mailing address of Mr.
Dewar, Sr. is P. O. Box 2995, Valdosta, Georgia 31604.
(9) Includes 400 vested options granted to Mr. Dixon.
(10) Includes 62,534 shares held by Mr. Jones' minor grandchildren, over which
shares Mr. Jones has custodial power.
(11) Includes 10,000 vested options granted to Mr. Kurrie.
(12) Includes 2,000 vested options granted to Mr. Lanier.
(13) Includes 2,000 vested options granted to Mr. Parker.
(14) Includes 16,117 shares held by Mr. Scruggs' wife, of which shares Mr.
Scruggs disclaims beneficial ownership. Also includes 10,000 vested
options granted to Mr. Scruggs.
(15) Includes 4,984 shares held by Mr. Simmons' wife and 19,536 shares held in a
trust for the benefit of Mr. Simmons' wife, of which shares Mr. Simmons
disclaims beneficial ownership. Includes 25,471 shares owned by Elberta
Crate and Box Co. Profit Sharing Fund of which Mr. Simmons, Jr., and John
H. Simmons, his brother, are co-trustees and as to which Mr. Simmons has
shared voting and investment power. Also includes 10,000 vested options
granted to Mr. Simmons.
(16) Includes 68,133 shares held by Mr. Simmons' wife, of which shares Mr.
Simmons disclaims beneficial ownership. Includes 25,471 shares owned by
Elberta Crate and Box Co. Profit Sharing Fund of which Mr. Simmons and D.
Ramsay Simmons, Jr., his brother, are co-trustees and as to which Mr.
Simmons has shared voting and investment power. Also includes 4,000 vested
options granted to Mr. Simmons.
24
<PAGE>
(17) Includes 15,082 shares held by Mr. Singletary's wife, of which shares Mr.
Singletary disclaims beneficial ownership. Includes 6,443 shares owned by
Sing Bros., Inc., of which Mr. Singletary is the President, and 2,675
shares owned by Tripo, Inc., of which Mr. Singletary is also the President.
Also includes 10,000 vested options granted to Mr. Singletary.
(18) Includes 1,009 shares held jointly with Mr. Wilkinson's wife as to which
shares Mr. Wilkinson possesses shared voting and investment power.
Includes 3,609 shares held by Mr. Wilkinson's wife of which shares Mr.
Wilkinson disclaims beneficial ownership. Includes 35,800 vested stock
options granted to Mr. Wilkinson.
CERTAIN TRANSACTIONS AND BUSINESS RELATIONSHIPS
During 1999, the Company acquired Baxley Federal Savings Bank pursuant to a
transaction in which the shareholders of the bank received shares of the
Company's common stock based on an exchange ratio set forth in the merger
agreement between the Company and the bank. Pursuant to the terms of the merger
agreement, Kenneth D. McLeod and Alvin R. Tuten, Jr. were appointed to the Board
of Directors of the Company and are being nominated for re-election at the
Annual Meeting. See "Proposal One: Election of Directors." In addition, pursuant
to the merger agreement, Baxley Federal Savings Bank entered into a new
employment agreement with Mr. Tuten pursuant to which he serves as Chief
Executive Officer of the bank.
Certain of the officers, directors and shareholders of the Company named in
this Proxy Statement and the Banks, and affiliates of such persons, have from
time to time engaged in banking transactions with the Banks. Such persons are
expected to continue these transactions in the future. Any loans or other
extensions of credit made by the Banks to such individuals were made in the
ordinary course of business on substantially the same terms, including interest
rates and collateral, as those prevailing at the time for comparable
transactions with unaffiliated third parties and did not involve more than the
normal risk of collectibility or present other unfavorable features. At
December 31, 1999, loans to officers, directors and shareholders of the Company
named in this Proxy Statement and the Banks and to affiliates of such persons
amounted to an aggregate of $13,352,489. Thompson Kurrie, Jr., a director of
the Company and The Park Avenue Bank, is a partner in the law firm of Coleman,
Talley, Newbern, Kurrie, Preston & Holland, which is engaged by the Company to
provide legal services. See "Executive Compensation - Compensation Committee
Interlocks and Insider Participation."
SHAREHOLDER PROPOSALS FOR INCLUSION IN NEXT YEAR'S
PROXY STATEMENT
Proposals of shareholders intended to be presented at the Company's 2001
Annual Meeting of Shareholders must be received at the Company's principal
executive offices by November 27, 2000 in order to be eligible for inclusion in
the Company's proxy statement and form of proxy for that meeting.
25
<PAGE>
OTHER SHAREHOLDER PROPOSALS FOR PRESENTATION
AT NEXT YEAR'S ANNUAL MEETING
For any proposal that is not submitted for inclusion in next year's Proxy
Statement, but is instead sought to be presented directly at the 2001 Annual
Meeting of Shareholders, management will be able to vote proxies in its
discretion if the Company: (i) receives notice of the proposal before the close
of business on February 5, 2001, and advises shareholders in the 2001 Proxy
Statement about the nature of the matter and how management intends to vote on
such matter; or (ii) does not receive notice of the proposal prior to the close
of business on February 5, 2001. Notices of intention to present proposals at
the 2001 Annual Meeting of Shareholders should be addressed to Denise McKenzie,
Secretary, PAB Bankshares, Inc., P. O. Box 3469, Valdosta, Georgia 31604.
ANNUAL REPORTS
Copies of the Company's 1999 Annual Report to Shareholders and Annual
Report on Form 10-K, which includes the Company's financial statements for the
year ended December 31, 1999, are being mailed to all shareholders together with
this Proxy Statement.
26
<PAGE>
<TABLE>
<S> <C> <C>
PAB BANKSHARES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder hereby appoints James L. Dewar, Sr. and R. Bradford Burnette, and each or either one of them, with
full power of substitution, as Proxies to represent and to vote, as designated below, all the shares of common stock of PAB
Bankshares, Inc. (the "Company"), held of record by the undersigned on March 10, 2000, at the Annual Meeting of Shareholders (the
"Annual Meeting") to be held at 3250 North Valdosta Road, Valdosta, Georgia 31602 on April 24, 2000, at 11:00 a.m. or any
postponements or adjournments thereof.
1. Election of the following nominees to the Board of Directors for the terms indicated below.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 1
Nominees: James L. Dewar, Jr., James L. Dewar, Sr., C. Larry Wilkinson, Joe P. Singletary, Jr., and Walter W. Carroll, II
for terms expiring at the 2003 Annual Meeting of Shareholders.
Kennith D. McLeod for a term expiring at the 2002 Annual Meeting of Shareholders.
Alvin R. Tuten, Jr. for a term expiring at the 2001 Annual Meeting of Shareholders.
Each Nominee shall hold office until the term of the class of directors for which he has been elected expires and until his
successor is duly elected and qualified, or until his earlier death, resignation, incapacity to serve, or removal.
[_] For all Nominees listed above (except [_] Withhold Authority to vote for all
as marked to the contrary below) Nominees listed above
Instructions: To withhold authority to vote for any individual Nominee, write that Nominee's name in the following space
provided:
---------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
2. In their discretion, the Proxies are authorized to vote upon such of the matters as may properly come before the Annual
Meeting or any postponements or adjournments thereof.
This Proxy revokes all prior proxies with respect to the Annual Meeting and may be revoked prior to its exercise. No
proposal above is conditioned on or related to any other proposal.
Please sign exactly as name appears below. When shares are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full
corporate name by president or other authorized officer. If a partnership, please sign in partnership name by authorized person.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION
IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE DIRECTOR NOMINEES NAMED IN PROPOSAL 1 AND IN THE DISCRETION OF THE PERSONS
NAMED AS PROXIES ON ALL OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY POSTPONEMENTS OR ADJOURNMENTS
THEREOF.
DATED:
------------------------------------- ---------------------------------------------------------------
Signature
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY
PROMPTLY USING THE ENCLOSED ENVELOPE
---------------------------------------------------------------
Signature (if held jointly)
</TABLE>
