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SCHEDULE 14A INFORMATION
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. N/A)
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 Rule 14a-11(c) or Rule 14a-12
CITIZENS BANCSHARES CORPORATION
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(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)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
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CITIZENS BANCSHARES CORPORATION
175 John Wesley Dobbs Avenue, NE
Atlanta, Georgia 30303
(404) 659-5959
May 8, 1998
To the Shareholders of CITIZENS BANCSHARES CORPORATION:
You are cordially invited to attend the Annual Shareholders' Meeting of
Citizens Bancshares Corporation (the "Company") to be held on Wednesday, May 27,
1998. Official Notice of the meeting, the Proxy Statement of management of the
Company and the Company's 1997 Annual Report accompany this letter.
The principal purpose of the meeting is to elect directors of the Company
for the coming year. We will also review the operations and recent developments
of the Company and the Bank for the past year.
Whether or not you plan to attend the meeting, please mark, date and sign
the enclosed form of proxy, and return it to the Company in the envelope
provided as soon as possible so that your shares can be voted at the Annual
Meeting.
Very truly yours,
James E. Young
President and Chief Executive Officer
<PAGE>
CITIZENS BANCSHARES CORPORATION
175 John Wesley Dobbs Avenue, NE
Atlanta, Georgia 30303
(404) 659-5959
NOTICE OF THE ANNUAL MEETING TO
BE HELD MAY 27, 1998
To the Shareholders of CITIZENS BANCSHARES CORPORATION:
Notice is hereby given that the Annual Shareholders' Meeting of Citizens
Bancshares Corporation will be held on Wednesday, May 27, 1998, at 11:00 a.m.,
at the Atlanta Life Insurance Company, Herndon Plaza, 100 Auburn Avenue, NE,
Atlanta, Georgia, for the following purpose:
(1) To elect six (6) directors (to serve until the next annual meeting and
until their successors are elected and qualified).
(2) To transact such other business as may properly come before the
meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on April 27, 1998 as
the record date for the determination of shareholders entitled to notice of and
to vote at the meeting.
All shareholders are requested to mark, date, sign and return the enclosed
form of proxy as soon as possible. If you attend the meeting and wish to vote
your shares in person, you may do so at any time before the proxy is exercised.
By Order of the Board of Directors,
James E. Young
President and Chief Executive Officer
May 8, 1998
<PAGE>
PROXY STATEMENT
OF
CITIZENS BANCSHARES CORPORATION
for the Annual Meeting to be Held
May 27, 1998
___________________________________
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of the Company for use at the Annual
Shareholders' Meeting and at any adjournments thereof. The Shareholders' Meeting
will be held on Wednesday, May 27, 1998 at 11:00 a.m., at the Atlanta Life
Insurance Company, Herndon Plaza, 100 Auburn Avenue, NE, Atlanta, Georgia. The
purpose of the Annual Shareholders' Meeting of the Company is to elect six (6)
directors for a one-year term until the next annual meeting.
The accompanying form of proxy is for use at the Annual Shareholders'
Meeting of the Company. A shareholder may use this proxy if he or she is unable
to attend the meeting in person or wishes to have his or her shares voted by
proxy even if the shareholder does attend the meeting. Shareholders who sign
proxies have the right to revoke them at any time before they are voted either
by written notice of revocation which is received at the Company's Main Office
before the meeting or by the Secretary at the meeting or by attending the
meeting and voting in person. All shares represented by valid proxies received
pursuant to this solicitation and not revoked before they are exercised will be
voted as directed, and where no direction is given, the shares represented by
such proxies will be voted for the election of directors listed thereon. The
Board of Directors of the Company is not aware of any other matters which may be
presented for action at the meeting, but if other matters do properly come
before the meeting, it is intended that shares represented by proxies will be
voted by the persons named in the proxies in accordance with their best
judgment.
Solicitation of proxies may be made in person or by mail, telephone or
facsimile by directors, officers and regular employees of the Company or
Citizens Trust Bank (the "Bank") who will not be specially compensated for such
solicitations. Brokerage houses, nominees, fiduciaries and other custodians will
be requested to forward solicitation materials to beneficial owners and to
secure their voting instructions, if necessary, and will be reimbursed for their
expenses incurred in sending proxy materials to beneficial owners. The Company
will bear the cost associated with solicitation of proxies and other expenses
associated with the Shareholders' Meeting.
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Record Date and Voting Rights
Each shareholder of record of the Company at the close of business on April
27, 1998 (the "Record Date") is entitled to notice of and to vote at the
Shareholders' Meeting. As of the close of business on the Record Date, the
Company had 5,000,000 shares of common stock ("Common Stock"), $1.00 par value,
authorized, of which 2,164,065 shares were issued and outstanding and held of
record by 1,650 shareholders. Each such share is entitled to one vote on matters
to be presented at the meeting.
ELECTION OF DIRECTORS
Nominees
The Board proposes that the slate of directors who have served since the
merger of First Southern Bancshares, Inc. into the Company on January 30, 1998
be reelected as directors of the Company to serve an additional one-year term
and until their successors are duly elected and qualified. If any of these
nominees should become unavailable to serve as a director (which is not now
anticipated), then the persons named as proxies reserve full discretion to vote
for any other person or persons as may be nominated. The affirmative vote of a
majority of the shares voted is required for the election of directors.
The table below sets forth for each director nominee (a) the person's name,
(b) his or her age at March 1, 1998, (c) the year he or she was first elected as
a director, and (d) his or her position with the Company other than as a
director and his or her other business experience for the past five years.
Director Nominees
To Serve a Term of One Year Until 1999
<TABLE>
<CAPTION>
Year
First Position with the Company;
Name Age Elected Business Experience
---- --- ------- -------------------
<S> <C> <C> <C>
Herman J. Russell 67 1972 Chairman of the Board of the Company;
Chairman of the Board of H.J. Russell &
Co. (construction, real estate and
wholesale building supplies distributor )
Gregory T. Baranco /1/ 49 1998 Vice Chairman of the Board of the
Company; President, Baranco Pontiac-GMC
Truck, Inc. (automotive dealer);
Chairman of the Board of Atlanta Life
</TABLE>
2
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<TABLE>
<CAPTION>
Year
First Position with the Company;
Name Age Elected Business Experience
---- --- ------- -------------------
<S> <C> <C> <C>
Insurance Company; previously Chairman
of the Board of First Southern
Bancshares, Inc. and First Southern Bank
Thomas E. Boland 63 1995 Special Counsel to the President of
Mercer University; previously Chairman
of the Board of Wachovia Bank of Georgia
Bernard H. Bronner /1/ 37 1998 President, Bronner Brothers , Inc. (hair
care products); President, Upscale
Magazine
Johnnie L. Clark 66 1982 Acting President and Chief Executive
Officer of the Company from July 1997 to
January 1998; previously Professor of
Accounting at Kennesaw State College
James E. Young /2/ 48 1998 President and Chief Executive Officer of
the Company; previously President and
Chief Executive Officer of First
Southern Bancshares, Inc. and First
Southern Bank
</TABLE>
__________________
/1/ Has served as a director of First Southern Bancshares, Inc. (which merged
with the Company on January 30, 1998) and First Southern Bank since 1989.
/2/ Has served as a director of First Southern Bancshares, Inc. (which merged
with the Company on January 30, 1998) and First Southern Bank since 1993.
Meetings of Committees and the Board of Directors
During the year ended December 31, 1997, the Board of Directors of the
Company held three meetings. Every director attended all of the Board meetings.
In addition, the Board of Directors of the Bank held twelve meetings in 1997.
The Board of Directors of the Company does not have standing Audit,
Compensation or Nominating Committees.
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While the Board of Directors of the Company does not have a standing
Nominating Committee nor a formal procedure for individual shareholders to
submit recommendations of persons to be considered as directors of the Company,
the Board will consider any such recommendation if delivered in writing to James
E. Young, Citizens Bancshares Corporation, 175 John Wesley Dobbs Avenue, NE,
Atlanta, Georgia 30303.
Principal Officers
The table set forth below shows for each principal officer of the Company
(a) the person's name, (b) his age at March 1, 1998, (c) the year he was first
elected as an officer of the Company, and (d) his present position with the
Company and the Bank and other business experience for the past five years, if
he has been employed by the Company or the Bank for less than five years.
<TABLE>
<CAPTION>
Year
First Position with the Company;
Name Age Elected Business Experience
---- --- ------- -------------------
<S> <C> <C> <C>
James E. Young 48 1998 President and Chief Executive Officer of
the Company and the Bank; previously
President and Chief Executive Officer of
First Southern Bancshares, Inc. and
First Southern Bank (1993-1998)
Willard C. Lewis 36 1998 Senior Executive Vice President and
Chief Operating Officer of the Company
and Bank; previously Executive Vice
President and Chief Operating Officer of
First Southern Bancshares, Inc. and
First Southern Bank (1991-1998)
Samuel J. Cox 40 1998 Senior Vice President and Director of
Finance and Accounting of the Company
and the Bank; previously Controller of
First Southern Bancshares, Inc. and
First Southern Bank (1996-1998); Manager
of Audit and Computer Consulting, Banks,
Finley, White & Co. (1993-1995)
</TABLE>
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EXECUTIVE COMPENSATION
The following table sets forth certain summary information concerning the
compensation paid to Dr. Johnnie L Clark who served as Acting Chief Executive
Officer of the Company from July 1997 through January, 1998, William Gibbs who
served as Chief Executive Officer of the Company and the Bank until July 1997,
and Edward N. Williams who served as Senior Executive Vice President and Chief
Operating Officer of the Bank until January 30, 1998.
Cash Compensation Table
<TABLE>
<CAPTION>
Annual
Compensation /1/
------------ All Other
Name and Principal Position Year Salary ($) Bonus ($) Compensation ($)
--------------------------- ---- --------- -------- ---------------
<S> <C> <C> <C> <C>
Johnnie L. Clark, Acting Chief 1997 $68,500/2/ -- $24,700/3/
Executive Officer
William L. Gibbs, President and 1997 $137,000 -- --
Chief Executive Officer 1996 $141,943 $24,000 $ 3,000/4/
1995 $132,096 $7,000 $ 977/4/
Edward N. Williams, Senior Vice 1997 $103,500 --
President and Chief Operating 1996 $103,500 $11,000/5/
Officer
</TABLE>
__________________
/1/ Information with respect to certain perquisites and other personal benefits
has been omitted because the aggregate value of such items does not meet the
minimum amount required for disclosure under regulations adopted by the
Securities and Exchange Commission ("SEC"). The Company has not awarded any
restricted stock or long-term incentives. Accordingly, columns relating to such
awards have been omitted.
/2/ Consists of $34,250 paid in salary in 1997 and $34,250 paid as of January
30, 1998, the effective date of the merger of First Southern Bancshares, Inc.
into the Company.
/3/ Consists of $24,700 directors' fees from the Company and the Bank.
/4/ Consists of payment of premiums on life insurance policy.
/5/ Consists of reimbursement for relocation expenses and taxes thereon.
After the merger of First Southern Bancshares, Inc. with and into the
Company, which was effective on January 30, 1998, James E. Young became
President and Chief Executive Officer of the Company. Mr. Young has entered into
an employment agreement with the Company which provides for a salary of $150,000
and incentive compensation contingent upon certain performance goals being met.
The agreement also provides for an option to purchase 17,500 shares of Common
Stock to be vested over a five-year term at an exercise price of $9.88 per
share.
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Director Fees
The directors of the Company receive fees in the amount of $300.00 per
meeting for their service as directors of the Company.
CERTAIN TRANSACTIONS
The Company's directors and principal officers, their immediate family
members and certain companies and other entities associated with them, have been
customers of and have had banking transactions with the Bank and are expected to
continue such relationships in the future. In the opinion of management, the
extensions of credit made by the Bank to such individuals, companies and
entities (a) were made in the ordinary course of business, (b) were made on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other persons and (c)
did not involve more than a normal risk of collectibility or present other
unfavorable features.
BENEFICIAL OWNERSHIP OF COMMON STOCK
Principal Holders of Common Stock
The following table sets forth the persons who beneficially owned, at
March 1, 1998, more than five percent of outstanding shares of Common Stock to
the best information and knowledge of the Company. Unless otherwise indicated,
each person is the record owner of and has sole voting and investment powers
over his shares.
<TABLE>
<CAPTION>
Name and Address Amount and Nature of Percent
of Beneficial Owner Beneficial Ownership/1/ of Class
- ------------------- -------------------- ---------
<S> <C> <C>
Herman J. Russell 573,601 26.51%
504 Fair Street, S.W.
Atlanta, Georgia 30313
</TABLE>
__________________
/1/ The information shown above is based upon information furnished to the
Company by the named persons. Information relating to beneficial ownership of
Common Stock is based upon "beneficial ownership" concepts set forth in rules
promulgated under the Securities Act of 1934, as amended. Under such rules a
person is deemed to be a "beneficial owner" of a security if that person has or
shares "voting power," which includes the power to dispose or to direct the
voting of such security, or "investment power," which includes the power to
dispose or to direct the disposition of such security. A person is also deemed
to be a beneficial owner of any security of which that person has the right to
acquire beneficial ownership within 60 days. Under the rules, more than one
person may be deemed to be a beneficial owner of the same securities. The shares
of Common Stock issuable upon exercise of the vested portion of any outstanding
options held by the indicated named persons are assumed to be outstanding for
the purpose of determining the percentage of shares beneficially owned by those
persons.
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<PAGE>
Common Stock Owned by Management
The following table sets forth the number and percentage ownership of
shares of Common Stock beneficially owned by each director of the Company and by
all directors and principal officers as a group, at March 1, 1997. Unless
otherwise indicated, each person is the record owner of and has sole voting and
investment powers over his or her shares.
<TABLE>
<CAPTION>
Number of Shares Percent
Name of Director Beneficially Owned/1/ Of Class
---------------- ------------------ --------
<S> <C> <C>
Herman J. Russell 573,601 26.51%
504 Fair Street, S.W.
Atlanta, Georgia 30313
Gregory T. Baranco 72,503/2/ 3.35%
4070 Sandy Lake Drive
Lithonia, Georgia 30038
Thomas E. Boland 500 *
3001 Mercer University Drive
Atlanta, Georgia 30341
Bernard H. Bronner 8,594/3/ *
594 Fielding Lane
Atlanta, Georgia 30311
Johnnie L. Clark 15,953 *
2794 Chaucer Drive, S.W.
Atlanta, Georgia 30311
James E. Young 377 *
647 Master Drive
Stone Mountain, Georgia 30032
All directors and principal
officers as a group (8 persons) 671,528 31.03%
</TABLE>
- ------------------
*Represents less than 1%.
/1/ The information shown above is based upon information furnished to the
Company by the named persons. Information relating to beneficial ownership of
Common Stock is based upon "beneficial ownership" concepts set forth in rules
promulgated under the Securities Act of 1934, as amended. Under such rules a
person is deemed to be a "beneficial owner" of a security if that person has or
shares "voting power," which includes the power to dispose or to direct the
voting of such security, or "investment power," which includes the power to
dispose or to direct the disposition of such security. A person is also deemed
to be a beneficial owner of any security of which that person has the right to
acquire beneficial ownership within 60 days. Under the rules, more than one
person may be deemed to be a beneficial owner of the same securities. The shares
of Common Stock issuable upon exercise of the vested
7
<PAGE>
portion of any outstanding options held by the indicated named persons are
assumed to be outstanding for the purpose of determining the percentage of
shares beneficially owned by those persons.
/2/ Consists of (a) 13,722 shares owned of record by Mr. Baranco , (b) 54,740
shares owned jointly with his spouse, and (c) 4,041 shares held in Mr. Baranco's
self-directed IRA.
/3/ Consists of (a) 8,067 shares owned of record by Mr. Bronner and (b) 527
shares owned by Bronner Brothers, Inc., a company controlled by Mr. Bronner.
Compliance with Section 16(a) of the Exchange Act
To the Company's knowledge, based solely upon a review of copies of
Reports of Beneficial Ownership and Changes in Beneficial Ownership furnished to
it and representations that no other reports were required, its directors,
executive officers, and greater than ten percent shareholders have complied with
applicable Section 16(a) filing requirements.
ACCOUNTING MATTERS
Porter Keadle Moore LLP, Atlanta, Georgia, certified public
accountants, has been appointed by the Board of Directors of the Company to
examine the financial statements of the Company as of and for the year ended
December 31, 1997. The Board of Directors intends to continue the services of
this firm for the year ending December 31, 1998. A representative of Porter
Keadle Moore LLP is expected to be present at the meeting to respond to any
appropriate questions and to make a statement if the representative desires to
do so.
SHAREHOLDER PROPOSALS
Any shareholder of the Company wishing to submit a proposal for action
at the next annual meeting of shareholders of the Company, and desiring
inclusion of the same in management's proxy materials, must provide a written
copy of the proposal to management not later than December 31, 1998. Any such
proposal must comply in all respects with the rules and regulations of the
Securities and Exchange Commission.
AVAILABLE INFORMATION
A copy of the Company's Annual Report to Shareholders on Form 10-KSB
(the "Form 10-KSB") is available upon request (except for the exhibits thereto)
without charge. Shareholders may request a copy of the Form 10-KSB by contacting
Willard C. Lewis, Citizens Bancshares Corporation, 175 John Wesley Dobbs Avenue,
NE, Atlanta, Georgia 30303 (Telephone: (404) 659-5959).
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<PAGE>
CITIZENS BANCSHARES CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL
MEETING OF SHAREHOLDERS TO BE HELD ON MAY 27, 1998
The undersigned hereby appoints Willard C. Lewis and Annette G. Petty as
proxies, each with the power to appoint his substitute, and hereby authorizes
them, and each of them, to represent and vote, as designated on the reverse, all
the shares of common stock of Citizens Bancshares Corporation held of record by
the undersigned on April 27, 1998 at the Annual Meeting of Stockholders to be
held on May 27, 1998 or any adjournments thereof.
Proposal: To elect the following persons to serve as directors for a one-year
term until the next annual meeting:
Nominees: Herman J. Russell Bernard H. Bronner
Gregory T. Baranco Johnnie L. Clark
Thomas E. Boland James E. Young
[_] For All Nominees [_] Withhold Authority to Vote for All Nominees Listed
Above
To withhold authority to vote for any nominee, write that nominee's name below:
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<PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED SHAREHOLDER. IF NO DIRECTION TO THE CONTRARY IS INDICATED, IT WILL
BE VOTED FOR THE PROPOSAL.
DISCRETIONARY AUTHORITY IS HEREBY CONFERRED AS TO ALL OTHER MATTERS WHICH MAY
COME BEFORE THE SPECIAL MEETING.
If stock is held in the name of more than one person, all holders should
sign. Signatures should correspond exactly with the name or names appearing on
the stock certificate(s). 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.
Date:__________________________________
_______________________________________
Name(s) of Shareholder(s)
_______________________________________
Signature(s) of Shareholder(s)
Please mark, date and sign this Proxy, and return it in the enclosed return-
addressed envelope. No postage is necessary.
