<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. ____)
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (s) 240.14a-11(c) or (s) 240.14a-12
Crescent Banking Company
- --------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- ---------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than 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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<PAGE>
March 26, 1998
TO THE SHAREHOLDERS OF
CRESCENT BANKING COMPANY:
You are cordially invited to attend the 1998 Annual Meeting of Shareholders
of Crescent Banking Company (the "Company"), which will be held at the Pickens
County Chamber of Commerce Community Center located at 500 Stegall Drive,
Jasper, Georgia, Thursday, April 16, 1998 at 2:00 p.m. (the "Annual Meeting").
At the Annual Meeting, you will be asked to consider and vote upon:
(1) The election of two Class I directors to serve until the Annual
Meeting in 2001 or until their successors are elected and qualified;
and
(2) A proposed amendment to and restatement of the Crescent Banking
Company 1995 Stock Option Plan for Outside Directors; and
(3) Such other matters as may properly come before the meeting or any
reconvened meeting following any adjournment thereof.
We hope you can attend the Annual Meeting and vote your shares in person.
In any case, please complete the enclosed proxy and return it to us. Your
completion of the proxy will ensure that your preferences will be expressed on
the matters that are being considered. If you are able to attend the Annual
Meeting, you may revoke your proxy and vote your shares in person. If you have
any questions about the Proxy Statement, please let us hear from you.
Sincerely,
J. Donald Boggus, Jr.
President and CEO
<PAGE>
CRESCENT BANKING COMPANY
251 HIGHWAY 515
JASPER, GA 30143
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, APRIL 16, 1998
TO THE SHAREHOLDERS OF CRESCENT BANKING COMPANY:
NOTICE IS HEREBY GIVEN that the 1998 Annual Meeting of Shareholders of
Crescent Banking Company (the "Company") will be held at the Pickens County
Chamber of Commerce Community Center located at 500 Stegall Drive, Jasper,
Georgia, Thursday, April 16, 1998 at 2:00 p.m. (the "Annual Meeting"), for the
following purposes:
1. Elect Directors. To elect two Class I directors to serve until the
----------------
Annual Meeting of Shareholders in 2001 or until their successors are
elected and qualified.
2. Plan Amendment. To consider and vote upon a proposed amendment to and
---------------
restatement of the Crescent Banking Company 1995 Stock Option Plan for
Outside Directors.
3. Other Business. To act upon such other matters as may properly come
---------------
before the meeting or any reconvened meeting following any adjournment
thereof.
Only shareholders of record at the close of business on March 20, 1998
are entitled to notice of and to vote at the Annual Meeting or any
adjournments thereof. All shareholders, whether or not they expect to attend
the Annual Meeting in person, are requested to complete, date, sign, and
return the enclosed form of proxy in the accompanying envelope. The proxy may
be revoked by the person executing the proxy by filing with the Secretary of
the Company an instrument of revocation or a duly executed proxy bearing a
later date, or by electing to vote in person at the Annual Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
J. Donald Boggus, Jr.
President and CEO
March 26, 1998
PLEASE COMPLETE, DATE, AND SIGN THE ENCLOSED PROXY AND RETURN IT TO THE
COMPANY IN THE ENVELOPE PROVIDED WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL
MEETING. IF YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE IN PERSON IF YOU
WISH, EVEN IF YOU HAVE PREVIOUSLY RETURNED YOUR PROXY.
<PAGE>
PROXY STATEMENT FOR
ANNUAL MEETING OF SHAREHOLDERS
OF CRESCENT BANKING COMPANY
TO BE HELD THURSDAY, APRIL 16, 1998
INTRODUCTION
GENERAL
This Proxy Statement is being furnished to the shareholders of Crescent
Banking Company (the "Company") in connection with the solicitation by the
Company of proxies for use at the 1998 Annual Meeting (the "Annual Meeting")
of Shareholders of the Company to be held Thursday, April 16, 1998, and at any
postponements or adjournments thereof. The Annual Meeting is being held to
consider and vote upon (i) the election of two Class I directors to serve
until the Annual Meeting of Shareholders in 2001 or until their successors are
elected and qualified, (ii) a proposed amendment to and restatement of the
Crescent Banking Company 1995 Stock Option Plan for Outside Directors, and
(ii) such other business as may properly come before the Annual Meeting or any
adjournments thereof. The Board of Directors of the Company knows of no other
business that will be presented for consideration at the Annual Meeting other
than the matters described in this Proxy Statement.
This Proxy Statement is dated March 26, 1998 and is first being mailed to
the shareholders of the Company on or about March 26, 1998. A copy of the
Company's 1997 Annual Report to Shareholders accompanies this Proxy Statement.
Shareholders of the Company may also receive, at no charge except the
Company's cost of copying exhibits, a copy of the Company's Annual Report on
Form 10-KSB as filed with the Securities and Exchange Commission by the
Company for the year ended December 31, 1997, by making a written or oral
request to J. Donald Boggus, Jr., President and CEO, Crescent Banking Company,
P.O. Box 668, Jasper, Georgia 30143, telephone (706) 692-2424.
RECORD DATE, SOLICITATION AND REVOCABILITY OF PROXIES
The Board of Directors of the Company has fixed the close of business on
March 20, 1998 as the record date (the "Record Date") for the determination of
the Company's shareholders entitled to notice of and to vote at the Annual
Meeting. Accordingly, only shareholders of the Company at the close of
business on the Record Date will be entitled to vote at the Annual Meeting.
At the close of business on the Record Date, there were 861,354 shares of the
$1.00 par value common stock of the Company ("Common Stock") issued and
outstanding and held by approximately 598 shareholders of record. Holders of
Common Stock are entitled to one vote on each matter considered and voted upon
at the Annual Meeting for each share of Common Stock held of record at the
close of business on the Record Date. Shares of Common Stock represented by a
properly executed proxy, if such proxy is received in time and not revoked,
will be voted at the Annual Meeting in accordance with the instructions
indicated in such proxy. IF NO INSTRUCTIONS ARE INDICATED, SUCH SHARES OF
COMMON STOCK WILL BE VOTED FOR ELECTION OF THE TWO NOMINEES FOR DIRECTOR NAMED
IN THE PROXY, FOR THE AMENDMENT AND RESTATEMENT OF THE 1995 STOCK OPTION PLAN
FOR OUTSIDE DIRECTORS, AND IN THE DISCRETION OF THE PROXY HOLDERS AS TO ANY
OTHER BUSINESS PROPERLY BROUGHT BEFORE THE ANNUAL MEETING.
A shareholder who gives a proxy may revoke it at any time prior to its
exercise at the Annual Meeting by (i) giving written notice of revocation to
the Secretary of the Company, (ii) properly submitting to the Company a duly
executed proxy bearing a later date, or (iii) appearing in person at the
Annual Meeting and voting in person. All written notices of revocation or
other communications with respect to proxies should be addressed as follows:
Crescent Banking Company, Post Office Box 668, Jasper, Georgia, 30143,
Attention: J. Donald Boggus, Jr., President and CEO.
<PAGE>
COST OF SOLICITATION OF PROXIES
The expense of this solicitation, including the cost of preparing and
mailing this Proxy Statement, will be paid by the Company. Copies of
solicitation material may be furnished to banks, brokerage houses and other
custodians, nominees and fiduciaries for forwarding to beneficial owners of
shares of the Company's Common Stock, and normal handling charges may be paid
for such forwarding service. In addition to solicitations by mail, directors
and regular employees of the Company may solicit Proxies in person or by
telephone or telegraph.
QUORUM AND VOTING REQUIREMENTS
Each shareholder is entitled to one vote on each proposal per share of
Common Stock held as of the record date. A quorum for the purposes of all
matters to be voted on shall consist of shareholders representing, in person
or by proxy, a majority of the outstanding shares of Common Stock entitled to
vote at the Annual Meeting.
The vote required for the election of directors is a plurality of the
votes cast by the shares entitled to vote in the election, provided a quorum
is present. The affirmative vote of the holders of a majority of the shares
voted, in person or by proxy, at the Annual Meeting on the amendment and
restatement of the 1995 Stock Option Plan for Outside Directors will
constitute approval of the Restated DSOP, provided a quorum is present. Thus,
with respect to both such proposals, (i) abstentions and broker "non-votes"
will not be counted as part of the base number votes to be used in determining
if the proposal has received the requisite number of base votes for approval,
and (ii) an abstention or broker non-vote will have no effect, other than for
the purpose of determining a quorum. A broker "non-vote" occurs when a
nominee holding shares for a beneficial owner does not vote on a particular
proposal because the nominee does not have discretionary voting power with
respect to that proposal and has not received instructions from the beneficial
owner.
ADJOURNMENT
In the event that a quorum is not represented in person or by proxy at
the Annual Meeting, a majority of shares represented at that time may adjourn
the Annual Meeting to allow the solicitation of additional proxies or other
measures to obtain a quorum.
PROPOSAL ONE
ELECTION OF DIRECTORS
GENERAL
The Board of Directors of the Company currently consists of six members
divided into three classes, designated Class I, Class II, and Class III, each
serving for a period of three years. The current members of the Company's
Board of Directors are serving terms ending with the Company's annual meetings
of shareholders 1998 (Class I), 1999 (Class II) and 2000 (Class III). One-
third of the members of the Board of Directors are elected by the shareholders
annually. The Annual Meeting is being held in part to elect two Class I
directors of the Company to serve until the Company's Annual Meeting of
Shareholders in 2001 or until their respective successors are elected and
qualified.
The directors whose terms will expire at the 1998 Annual Meeting are
Charles Fendley and A. James Elliott. Messrs. Fendley and Elliott have been
nominated by the Board of Directors to stand for reelection. If elected,
Messrs. Fendley and Elliott will serve as Class I directors holding office
until the Annual Meeting of Shareholders in 2001 and until their successors
are elected and qualified. The following table sets forth as to each director
or nominee his name; age at March 20, 1998; the date first elected as a
director; a description of positions and offices with the Company (other than
as a director), Crescent Bank and Trust Company (the "Bank"), and Crescent
Mortgage Services, Inc. ("CMS"), if any; a brief description of principal
occupation or occupations over at least the last five years; other business
experience; the number of shares of Common Stock beneficially owned on March
20, 1998; and the percentage of the total shares of Common Stock outstanding
on March 20, 1998 that such beneficial ownership represents. Messrs. Howell
and Rast have served as directors of the Company since its
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<PAGE>
organization, and as directors of the Bank from its organization until April
1995. Mr. Lowe has served as director of the Bank and of the Company since
their respective organizations. Mr. Fendley, who has served as a director of
the Bank since its organization, was elected to the Company's Board of
Directors at the 1994 Annual Meeting. Mr. Howard has served as a director of
the Bank and Company since the 1994 Annual Meeting. Mr. Elliott has served as
a director of the Company since October 1996 and a director of the Bank since
April 1995.
<TABLE>
<CAPTION>
Name; Age Number and
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at March 20, 1998; Percentage of Principal Occupation
----------------- ------------- --------------------
Date First Elected as Shares (1) and Business Experience
--------------------- ---------- -----------------------
Director
--------
Nominees for Election to Class I Directors (Term Expiring 2001)
---------------------------------------------------------------
<S> <C> <C>
Charles R. Fendley 6,850 Mr. Fendley served as the Vice President of Jasper Yarn
Age 52 (0.79%) Processing, Inc., a textile business,
1994 from 1972 until 1996, and a director of
Oglethorpe Power Corporation since 1993. Since
August 1996, Mr. Fendley has served as a
mortgage officer of Crescent Bank and Trust
Company. Mr. Fendley has served as Secretary of
the Company since May, 1995.
A. James Elliott 10.270 Mr. Elliott served as a partner with Alston &
Age 56 (1.19%) Bird, LLP for thirty years upon leaving in
1995 1994. After leaving Alston & Bird, LLP in 1994,
he joined Emory University Law School as the
Associate Dean. Mr. Elliott has served as a
director of the Bank since April 1995 and as
its Chairman since April 1996. Mr. Elliott has
served on the Board of Directors of the Company
since October 1996.
Incumbent Class II Directors (Term Expiring 1999)
-------------------------------------------------
L. Edmund Rast 11,600 Mr. Rast began his career with the
Age 82 (1.34%) Southern Bell Telephone Company in
1991 1937 and served in various
capacities before leaving Southern
Bell as President and Chief
Executive Officer in 1981. Mr. Rast
then joined Audichron Co., an
Atlanta electronics company, as
Chairman and Chief Executive
Officer in 1983 and remained with
Audichron until his retirement in
1984. Mr. Rast previously served as
Chairman of the Board of the Bank
until April 1995 when Mr. Rast
retired from the Bank's Board. Mr.
Rast also served as Chairman of the
Board of the Company since its
organization until May 1995.
Harry C. Howard 15,400 Mr. Howard was a partner in the
Age 68 (1.79%) Atlanta law firm of King & Spalding
1994 from 1960 through 1992 and is
presently a retired partner of such
firm. Mr. Howard served as Chairman
of the Board of the Bank from April
1995 to April 1996.
</TABLE>
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<PAGE>
Incumbent Class III Directors (Term Expiring 2000)
--------------------------------------------------
Arthur Howell 20,998 (2) Mr. Howell was a partner in the
Age 78 (2.43%) Atlanta law firm of Alston & Bird,
1991 LLP from 1945 through August 1988,
and is currently of counsel with
that firm. He is the President and
a director of Summit Industries,
Inc., a family-owned consumer
products company, and is a director
of the Enterprise Group of Funds.
Mr. Howell has served as Chairman
of the Company's Board since May
1995. Mr. Howell had previously
served as Secretary of the Company.
Mr. Howell retired from the Bank's
Board in April 1995.
Michael W. Lowe 108,177 Mr. Lowe founded Jasper Jeep Sales,
Age 50 (12.54%) Inc., in 1976 and has served as its
1991 Chief Executive Officer since that
time.
________________________________________
(1) Information relating to beneficial ownership of Company Common Stock is
based upon information furnished by each person using "beneficial
ownership" concepts set forth in the rules of the Securities and Exchange
Commission. Under those 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 vote or direct the voting of such security, or
"investment power," which includes the power to dispose of or to direct
the disposition of such security. The person is also deemed to be a
beneficial owner of any security of which that person has a right to
acquire beneficial ownership within 60 days. Under those rules, more
than one person may be deemed to be a beneficial owner of the same
securities, and a person may be deemed to be a beneficial owner of
securities as to which he or she may disclaim any beneficial interest.
Accordingly, directors are named as beneficial owners of shares as to
which they may disclaim any beneficial interest.
(2) Includes 1,185 shares held by Mr. Howell's wife, as to which shares Mr.
Howell disclaims beneficial ownership.
(3) Includes 13,200 shares held as custodian for Mr. Lowe's children and
2,500 shares held by his wife.
RECOMMENDATION AND REQUIRED VOTE
A plurality of the votes cast by the shares entitled to vote on this
proposal at the Annual Meeting, at which a quorum is present, is required for
the election of each of the nominees listed above. THE BOARD OF DIRECTORS
RECOMMENDS A VOTE "FOR" THE ELECTION OF THE TWO NOMINEES LISTED ABOVE.
Proxies solicited by the Board of Directors will be so voted unless
shareholders specify a contrary choice in their proxies.
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<PAGE>
PROPOSAL TWO
AMENDMENT AND RESTATEMENT OF THE
1995 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
The Company currently maintains the Crescent Banking Company 1995 Stock
Option Plan for Outside Directors (the "Current DSOP"). The Board of
Directors has adopted, subject to approval thereof by the shareholders at the
Annual Meeting, an amendment and restatement of the Current DSOP, as described
below (the "Restated DSOP", together with the Current DSOP, the "Plan"). If
approved by the shareholders at the Annual Meeting, the Restated DSOP will be
effective as of as of its adoption by the shareholders.
A summary of the Restated DSOP is set forth below. The summary is
qualified in its entirety by reference to the full text of the Restated DSOP,
which is attached to this Proxy Statement as Appendix A.
GENERAL
The purpose of the Plan is to advance the interests of the Company by
encouraging ownership of Common Stock by non-employee directors, thereby
giving such directors an increased incentive to devote their efforts to the
success of the Company. Awards are granted under the Plan in addition to cash
fees to non-employee directors.
SUMMARY OF PROPOSED AMENDMENTS
The Current DSOP is proposed to be amended by (i) changing the name of
the Plan to the Crescent Banking Company Amended and Restated Stock Option
Plan for Outside Directors, (ii) increasing the number of shares available for
the grant of options under the Plan from 25,000 to 49,000, (iii) extending the
term of the Plan by three years to 2003, (iv) changing in the 1998 annual
grant of options from a grant of 200 shares at $16.00 per share to a grant of
2,000 shares at 105% of the fair market value of the Company's common stock on
the date immediately following the 1998 Annual Meeting, (v) granting the Board
of Directors of the Company the authority to administer and interpret the
Plan, and (vi) amending the amendment provisions of the Current DSOP to
eliminate certain obsolete requirements stemming from former versions of Rule
16b-3 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act").
ELIGIBILITY
Each member of the Company's or the Bank's Board of Directors who is not
a current employee of the Company or the Bank (an "Outside Director") is and
will be a participant in the Plan.
ADMINISTRATION
Grants of awards under the Plan are automatic. The plan is intended to
be a "formula plan" for purposes of Section 16(b) of the Exchange Act.
However, the Board of Directors of the Company will have authority to
interpret the Plan and otherwise administer the plan in accordance with its
terms.
SHARES SUBJECT TO PLAN
Shares subject to the Plan may be authorized but unissued shares or
shares that were once issued and subsequently reacquired by the Company. The
total remaining number of shares of Common Stock for which options may be
granted under the Current DSOP is 12,200 shares. Under the Restated DSOP,
that number would be increased so that the total number of shares of Common
Stock for which options may be granted under the Plan (including options
previously granted under the Current DSOP) will be 49,000 shares, subject to
adjustment in accordance with the plan. In the event that any outstanding
option for any reason expires or is terminated prior to the end of the period
during which options may be granted under the Plan, the shares of Common Stock
allocable to the unexercised portion of such option may again be subject in
whole or in part to an award of options under the Restated DSOP.
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<PAGE>
TERMS AND CONDITIONS OF OPTIONS
Options granted pursuant to the Plan are and will be subject to the
following terms and conditions:
Grant of Options. Each person who was an Outside Director both on
November 2, 1988 (the date of incorporation of the Bank) and on March 16, 1995
(a total of eight persons) was granted as of March 16, 1995 an option to
purchase 1,000 shares of the Company's Common Stock, subject to adjustment as
provided in the Current DSOP. Pursuant to this provision, 8,000 options were
granted to Outside Directors as of March 16, 1995. On the day following each
subsequent annual meeting of the Company's shareholders, beginning with the
1995 annual meeting and extending though the 2003 annual meeting, but
excluding the 1998 annual meeting, each Outside Director who was or is serving
in such capacity as of such date (whether or not serving as an Outside
Director on November 2, 1988) was and will be granted an option to purchase
200 shares of Common Stock. On the day following the 1998 annual meeting,
each Outside Director who is serving in such capacity as of such date will be
granted an option to purchase 2,000 shares of Common Stock (the "1998
Options"). Appropriate pro-rata grants will be made if at any time there are
insufficient shares under the Plan to make the full scheduled grants.
Option Terms. The option price for each option granted under the
Restated DSOP other than the 1998 Options is $16.00 per share. The option
price for the 1998 Options will be 105% of the fair market value of the
Company's common stock on the day after the Annual Meeting. The option price
is payable in full upon the exercise of an option in cash or by check. To the
extent permitted under Regulation T of the Federal Reserve Board, and subject
to applicable securities laws, options may be exercised through a broker in a
so-called "cashless exercise" whereby the broker sells the option shares and
delivers cash sales proceeds to the Company in payment of the exercise price.
In no event may shares of Common Stock be used as payment of the exercise
price of the option.
Each option granted under the Plan will, to the extent not previously
exercised, terminate and expire on the date ten (10) years after the date of
grant of the option, unless earlier terminated as provided in the Plan. Each
option granted under the Plan will be exercisable, in whole or in part, six
months and one day after the date of grant.
No option will be assignable or transferable by the grantee except by
will, by the laws of descent and distribution or pursuant to a qualified
domestic relations order. During the lifetime of the grantee, the option will
be exercisable only by the grantee.
The Plan provides for appropriate adjustments in the options in the event
of certain recapitalizations involving the Common Stock and for the assumption
or substitution of the options by a surviving Company in certain business
combinations or reorganizations.
Effect of Termination of Directorship or Death. Upon termination of any
grantee's membership on the Board of Directors of the Company or the Bank for
any reason other than for cause or death, the options held by the grantee
under the Plan will continue uninterrupted until the date of expiration of the
options as provided by the Plan. If the grantee's membership on the Board of
Directors is terminated for cause, all options granted to such grantee will
expire upon such termination. In the event of the death of a grantee, the
grantee's personal representatives, heirs or legatees may exercise the options
held by the grantee on the date of death, within one year after the grantee's
death and in any event prior to the date on which the options expire as
provided by the Plan.
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<PAGE>
TERMINATION AND AMENDMENT
The Plan will terminate immediately after the grant of options in
connection with the 2003 annual meeting, but the Board of Directors may
terminate the Plan at any earlier time. The Board of Directors may amend the
Plan; provided, however, that without the approval of the shareholders, no
such amendment may change the maximum number of shares of Common Stock as to
which options may be granted under the Plan (except by operation of the
adjustment provisions of the plan); the date on which the Plan will terminate;
the number of shares of Common Stock subject to each option; the option price;
or the provisions relating to the determination of persons to whom options may
be granted.
NO RIGHTS AS SHAREHOLDER
Neither the grantee nor the grantee's successors will have rights as a
shareholder of the Company with respect to shares of Common Stock covered by
the grantee's option until the grantee or the grantee's successors become the
holder of record of such shares.
FEDERAL INCOME TAX EFFECTS
The options granted under the Plan are and will be non-qualified stock
options. Under present federal income tax laws, there will be no federal
income tax consequences to either the Company or the grantee upon the grant of
options under the Plan. However, the grantee will realize ordinary income on
the exercise of an option in an amount equal to the excess of the fair market
value of the Common Stock acquired upon the exercise of such option over the
exercise price, and the Company will receive a corresponding deduction. The
grantee will have a tax basis in such shares equal to the fair market value of
the Common Stock on the date of grant, and any subsequent gain or loss
realized upon the subsequent disposition by the grantee of the Common Stock
will constitute capital gain or loss, which will be taxed at a rate depending
on the grantee's holding period.
RESTRICTIONS ON RESALE
If a grantee has ceased to be an "affiliate" of the Company, he may
resell the Common Stock acquired under the Plan without compliance with the
requirements of Rule 144. Otherwise, resales of Common Stock acquired under
the Plan may be sold only in compliance with all of the provisions of Rule
144, other than the one-year holding period requirement, or pursuant to a
separate registration for the sale of such shares. In general, under Rule
144, an "affiliate" (which term includes directors of the Company and persons
whose shares are aggregated with such affiliate) is entitled to sell within
any three-month period a number of shares (including shares received other
than pursuant to the Plan) that does not exceed the greater of one percent of
the then-outstanding shares of the Company's Common Stock or the average
weekly trading volume in the over-the-counter market during the four calendar
weeks preceding the sale.
BENEFITS TO OUTSIDE DIRECTORS
Only Outside Directors are entitled to participate in the Plan (currently
12 persons). The following table shows the benefits that will accrue under
the Plan, for each year that it is in effect, to the persons and groups
indicated.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------
NAME AND POSITION DOLLAR VALUE ($) NO. OF OPTIONS
----------------- ---------------- --------------
- -----------------------------------------------------------------------------
<S> <C> <C>
All Outside Directors,
as a Group (12 persons) (1) 2,400 (2)
24,000 (3)
- -----------------------------------------------------------------------------
</TABLE>
_________________________________
(1) On a per share basis, this amount will be equal to the excess of the fair
market value of the Common Stock on the date of exercise of the option
over the exercise price of the option. The Board of Directors
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<PAGE>
believes the fair market value of the Common Stock on March 1, 1998 was
$16.25, based on the completion at about that time of an offering to
purchase up to 135,000 shares from existing shareholders at $16.25 per
share.
(2) Number of options to be granted in any one year other than 1998 while the
Plan is in effect, assuming there are 12 Outside Directors in such year.
(3) Number of options to be granted in 1998, assuming there are 12 Outside
Directors in such year.
RECOMMENDATION AND REQUIRED VOTE
The affirmative vote of the holders of a majority of the shares voted, in
person or by proxy, at the Annual Meeting on this proposal will constitute
approval of the Restated DSOP, provided a quorum is present. If not so
approved by the shareholders, the Current DSOP, and all options granted
thereunder, will continue as in effect prior to such amendments.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL TO AMEND AND
RESTATE THE 1995 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS. Proxies solicited
by the Board of Directors will be so voted unless shareholders specify a
contrary choice in their proxies.
ADDITIONAL INFORMATION
COMPENSATION OF DIRECTORS AND ATTENDANCE AT MEETINGS
Members of the Board of Directors each received a $4000 retainer fee for
their service on the Company's Board of Directors. Beginning in 1995, non-
employee directors of the Company and the Bank received stock options pursuant
to the 1995 Stock Option Plan for Outside Directors. Each Outside Director
who serves in such capacity as of the day following the annual meeting of the
Company's shareholders is granted an option to purchase 200 shares of Common
Stock. The plan covers 25,000 shares of which 12,800 have been granted. If
the amendment and restatement of the 1995 Stock Option Plan for Outside
Directors is approved at the Annual Meeting (see Proposal Two, above), the
aggregate number of shares available under such plan will be increased to
49,000 and the 1998 grant will be for 2,000 per participant rather than 200.
The Board of Directors held five meetings during 1997. Each director of the
Company during 1997 who is a nominee for reelection attended at least 75% of
the aggregate number of meetings of the Board of Directors and committees of
the Board of Directors on which he serves.
COMMITTEES OF THE BOARD OF DIRECTORS
The Bank's Board of Directors maintains standing Executive, Audit,
Mortgage Banking, Loan and Investment Committees. The Company's Board of
Directors presently has only a standing Stock Option Committee, which is
composed of Messrs. Howell (Chairman), Lowe and Rast. The Company's Board of
Directors performs the function of a Nominating Committee. The Board will
consider nominees for director recommended by a shareholder entitled to vote
in the election of directors, provided that written notice of the
shareholder's intent to make such nomination or nominations has been given in
writing to the Secretary of the Company, in the case of an annual meeting of
shareholder, no later than 90 days prior to the close of business on the 10th
day following the date on which notice of the meeting at which the election is
to take place is first given to shareholders. The notice shall set forth:
(a) the name and address of the shareholder who intends to make the nomination
and of the person or persons to be nominated; (b) a statement that the
shareholder is a holder of record of stock of the Company entitled to vote at
the meeting and intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice; (c) such information
regarding each nominee proposed by such shareholder as would be required to be
included in a proxy statement filed pursuant to the proxy rules of the
Securities and Exchange Commission; and (d) the consent of each nominee to
serve as a director of the Company if so elected.
The Audit Committee of the Board of Directors of the Bank is composed of
Messrs. Harry Howard (Chairman), Charles Wynne, and Charles Fendley. The
Audit Committee has the responsibility of reviewing the
-11-
<PAGE>
Bank's financial statements, evaluating internal accounting controls,
reviewing reports of regulatory authorities and determining that all audits
and examinations required by law are performed. It recommends to the Board of
Directors of the Company the appointment of the independent auditors for the
next fiscal year, reviews and approves their audit plan and reviews with the
independent auditors the results of the audit and management's response
thereto. The Audit Committee also reviews the adequacy of the internal audit
budget and personnel, the internal audit plan and schedule, and results of
audits performed by the internal audit staff. The Audit Committee is
responsible for overseeing the entire audit function and appraising the
effectiveness of internal and external audit efforts. The Audit Committee
reports its findings to the Board of Directors. The Audit Committee held four
meetings during the year ended December 31, 1997.
While the Company does not have a standing compensation committee, the
Board of Directors reviews and approves the compensation of executive officers
of the Bank. All officers of the Company are compensated by the Bank.
OWNERSHIP OF COMMON STOCK BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table reflects the number of shares of Common Stock
beneficially owned by (i) each of the directors, (ii) each of the executive
officers named in the Summary Compensation Table, and (iii) all of the
directors and executive officers of the Company as a group including the name
and address of the only persons known by the Company to beneficially own more
than 5% of the Common Stock as of March 20, 1998, together with the number of
shares and percentage of outstanding shares beneficially owned. Management of
the Company is informed that all such shares were held individually by each
such shareholder with sole voting and investment power, except as noted
herein.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENT OF CLASS
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1)
<S> <C> <C>
Michael W. Lowe, Director 108,177 (2) 12.54%
Fox Run
Jasper, GA 30143
Charles R. Fendley, Secretary 6,850 0.79%
165 Town Creek Trail
Jasper, GA 30143
Arthur Howell, Chairman 20,998 (3) 1.79%
200 Larkspur Lane
Highlands, NC 28741
Harry C. Howard, Director 15,400 1.79%
191 PEACHTREE STREET
SUITE 4900
ATLANTA, GA 30303-1763
Robert C. KenKnight, Executive Officer 11,480 1.32%
2043 Woodland Way
Dunwoody, GA 30338
L. Edmund Rast, Director 11,600 1.34%
4434 Harris Valley Road
Atlanta, GA 30327
</TABLE>
-12-
<PAGE>
<TABLE>
<S> <C> <C>
J. Donald Boggus, Jr., President/CEO 14,748 (4) 1.70%
281 Happy Talk Trail
Jasper, GA 30143
James D. Boggus, Sr. 46,384 (5) 5.38%
948 Happy Talk Trail
Jasper, GA 30143
A. James Elliott, Director 10,270 1.19%
732 Big Canoe
Big Canoe, GA 30143
Michael P. Leddy, Senior Officer -0- 0%
4698 East Conway Drive
Atlanta, GA 30327
All current directors and executive
officer as a group (9 persons) 245,907 (6) 27.77%
________________________________________
(1) Information relating to beneficial ownership of Common Stock is based
upon information furnished by each person using "beneficial ownership"
concepts as set forth in the rules of the Securities and Exchange
Commission. Under those 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 vote or direct the voting of such security, or
"investment power," which includes the power to dispose of or direct the
disposition of such security. The person is also deemed to be a
beneficial owner of any security of which that person has a right to
acquire beneficial ownership within 60 days. Under those rules, more
than one person may be deemed to be a beneficial owner of the same
securities, and a person may be deemed to be a beneficial owner of
securities as to which he or she may disclaim any beneficial interest.
Accordingly, directors are named as beneficial owners of shares as to
which they may disclaim any beneficial interest.
(2) Includes 13,200 shares held as custodian for Mr. Lowe's children and
2,500 shares held by his wife.
(3) Includes 1,000 shares held by Mr. Howell's wife, as to which shares Mr.
Howell disclaims beneficial ownership.
(4) Includes 6,000 shares subject to stock options currently exercisable or
within 60 days and 363 shares held by Mr. Boggus' wife.
(5) Includes 600 shares held by Mr. Boggus' wife.
</TABLE>
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
Under rules established by the Securities and Exchange Commission, the
Company is required to provide certain data and information in regard to the
compensation and benefits provided to the Company's chief executive officer
and other executive officers who make in excess of $100,000 per year
(collectively, the "named executive officers").
-13-
<PAGE>
The table below sets forth-certain elements of compensation for the named
executive officers of the Company or the Bank for the periods indicated.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
--------------------------------- ---------------------------
- ----------------------------------------------------------------------------------------------------------------------
SECURITIES ALL
RESTRICTED UNDERLYING OTHER
NAME AND PRINCIPAL OTHER ANNUAL STOCK OPTIONS/ COMPENSATION
POSITION YEAR SALARY ($) BONUS ($) COMPENSATION($) AWARDS(1) SARS (#) ($)(2)
- -------- ---- ---------- -------- -------------- ----------- --------- ----------
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
J. DONALD BOGGUS, JR. 1997 $ 70,000 $10,000 - - - $ 7,202
President and Chief 1996 65,000 6,500 - - - 4,361
Executive Officer of the 1995 50,000 5,000 - - - 87
Company and the Bank
----------------------------------------------------------------------------------------------------------------------
ROBERT C. KENKNIGHT 1997 $278,086 - - 1,939 - $12,373
Executive Vice President 1996 322,286 - - - 2,500 9,050
of the Bank; President 1995 283,364 - - - - 5,064
of the Bank's Mortgage
Division
----------------------------------------------------------------------------------------------------------------------
MICHAEL P. LEDDY 1997 $163,348 $25,000 - - - $ 7,042
Senior Vice President of 1996 125,000 25,000 - - 1,500 5,008
the Bank in Charge of 1995 112,500 9,000 - - 5,000 864
Secondary Mortgage
Marketing
----------------------------------------------------------------------------------------------------------------------
</TABLE>
________________________________________
(1) Mr. KenKnight was granted 1,939 shares of restricted stock on March 1,
1997, pursuant to his employment agreement, based on a percentage of the
total added value of the Bank's mortgage division and CMS. Such shares
vest as to 20% per year from the date of grant. As of December 31, 1997,
Mr. KenKnight was the only person holding restricted stock of the
Company. On such date, his 1,939 shares of restricted stock were valued
at $31,672.
(2) Other compensation represents insurance premiums paid by the Company on
group term life insurance in excess of $50,000 and car allowance.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
No stock options or stock appreciation rights ("SARs") were granted to
the named executive officers in 1997.
-14-
<PAGE>
Aggregated Option/SAR Exercises in 1997
AND 1997 YEAR-END OPTION/SAR VALUES
The following table shows stock options exercised by the named executive
officers during 1997, including the aggregate value of gains on the date of
exercise. In addition, this table includes the number of shares covered by
both exercisable and non-exercisable options as of December 31, 1997. Also
reported are the values for "in-the-money" options, which represent the
positive spread between the exercise price of any such existing options and
the year-end price of the Company's Common Stock. No SARs were outstanding in
1997.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
NUMBER OF
SECURITIES VALUE OF UNEXERCISED
UNDERLYING IN-THE-MONEY
UNEXERCISED OPTIONS/SARS AT
OPTIONS/SARS AT FY-END ($)
FY-END (#)
SHARES ACQUIRED
ON VALUE REALIZED EXERCISABLE(E)/ EXERCISABLE(E)/
NAME EXERCISE (#) ($) UNEXERCISABLE(U) UNEXERCISABLE(U)
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J. Donald Boggus, Jr. 0 N/A 6,000(E) $29,000 (E)
-0- (U) $0 (U)
- -------------------------------------------------------------------------------------------------------------
Robert C. KenKnight 0 N/A 6,666(E) $23,331 (E)
5,834(U) $17,919 (U)
- -------------------------------------------------------------------------------------------------------------
Michael P. Leddy 0 N/A -0- (E) $0 (E)
6,500 (U) $12,500 (U)
- -------------------------------------------------------------------------------------------------------------
A. James Elliott 0 N/A 600 (E) $0(E)
-0- (U) $0(U)
- -------------------------------------------------------------------------------------------------------------
Charles R. Fendley 0 N/A 1,600(E) $0(E)
-0- (U) $0(U)
- -------------------------------------------------------------------------------------------------------------
Harry C. Howard 0 N/A 600 (E) $0(E)
-0- (U) $0(U)
- -------------------------------------------------------------------------------------------------------------
Arthur Howell 0 N/A 1,600(E) $0(E)
-0- (U) $0(U)
- -------------------------------------------------------------------------------------------------------------
Michael W. Lowe 0 N/A 1,600(E) $0(E)
-0- (U) $0(U)
- -------------------------------------------------------------------------------------------------------------
L. Edmund Rast 0 N/A 1,600(E) $0(E)
-0- (U) $0(U)
- -------------------------------------------------------------------------------------------------------------
</TABLE>
EXECUTIVE EMPLOYMENT AGREEMENT
Robert C. KenKnight, the President of CMS and Executive Vice President of
the Bank, has entered into an employment agreement with the Company. In
addition to Mr. KenKnight's salary, he is entitled to incentive compensation
in the form of cash and shares of restricted stock based on a percentage of
the total added value of
-15-
<PAGE>
the Bank's mortgage division and CMS. In the event the Bank or the Company is
acquired and Mr. KenKnight's employment is terminated as a result of such
acquisition, the employment agreement authorizes a severance payment
approximately equal to 12 months of annual compensation in effect at such time
plus any accrued incentive compensation.
CERTAIN TRANSACTIONS
Directors and executive officers of the Company and the Bank and certain
business organizations and individuals associated with such persons have been
customers of and have had banking transactions with the Bank in the ordinary
course of business. Such transactions include loans, commitments, lines of
credit, and letters of credit. Such transactions were made on substantially
the same terms, including interest rates, repayment terms, and collateral, as
those prevailing at the time for comparable transactions with other persons,
and did not and do not involve more than normal risk of collectibility or
present other unfavorable features. Additional transactions with such persons
and businesses are anticipated in the future.
The Bank has had, and expects to have in the future, banking transactions
in the ordinary course of business with certain of its and the Company's
directors, nominees for director, executive officers, five percent
shareholders, and their associates. All loans included in such transactions
have been made on substantially the same terms, including interest rates,
repayment terms and collateral, as those prevailing at the time such loans
were made for comparable transactions with other persons, and do not involve
more than the normal risk of collectibility or present other features
unfavorable to the Bank. At December 31, 1997, the amount of credit extended
to directors, executive officers, principal shareholders and their associates
was approximately $1,865,699, or 20.9% of the Company's consolidated
shareholders equity.
INFORMATION CONCERNING THE COMPANY'S INDEPENDENT AUDITOR
The certified public accounting public firm of Mauldin & Jenkins was the
independent auditor for the Company during the year ended December 31, 1997.
Representatives of Mauldin & Jenkins are expected to be present at the Annual
Meeting and will have the opportunity to make a statement if they desire to do
so and to respond to appropriate questions. The Board of Directors of the
Company currently intends to approve the engagement of Mauldin & Jenkins as
its independent auditors for the fiscal year ending December 31, 1998.
During the two most recent fiscal years and through the date hereof, the
Company has not consulted with Mauldin & Jenkins on items which (i) were or
should have been subject to SAS 50 or (ii) concerned the subject matter of a
disagreement or reportable event with the former auditor as (described in
Regulation S-B, Item 304 (a)(2)).
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of the Company's Common Stock, to file with the Securities and
Exchange Commission (the "SEC") initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of the
Company. Directors, executive officers, and greater than ten percent
shareholders are required by SEC regulation to furnish the Company the copies
of all 16(a) reports they file. To the Company's knowledge, based solely on a
review of the copies of such reports furnished to the Company and written
representations that no other reports were required, during the fiscal year
ended December 31, 1997, all Section 16(a) filing requirements applicable to
directors, executive officers, and greater than ten percent beneficial owners
were complied with by such persons.
OTHER BUSINESS
Management of the Company does not know of any matters to be brought
before the Annual Meeting other than those described above. If any other
matters properly come before the Annual Meeting, the persons designated as
proxies will vote on such matters in accordance with their best judgment.
-16-
<PAGE>
SHAREHOLDER'S PROPOSALS FOR THE 1999 ANNUAL MEETING
Proposals from Shareholders intended to be presented at the 1999 Annual
Meeting of Shareholders must be received by the Company on or before November
26, 1998 to be eligible for inclusion in the Company's Proxy Statement and
Proxy related to that meeting.
-17-
<PAGE>
APPENDIX A
CRESCENT BANKING COMPANY
AMENDED AND RESTATED STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
------------------------------------------------------------
1. Purpose. The purpose of the Crescent Banking Company Amended and
-------
Restated Stock Option Plan for Outside Directors (the "Plan") is to advance the
interests of Crescent Banking Company (the "Company") by encouraging ownership
of the Company's $1.00 par value common stock (the "Common Stock") by non-
employee directors of the Company and its wholly-owned subsidiary, Crescent Bank
and Trust Company (the "Bank"), thereby giving such directors an increased
incentive to devote their efforts to the success of the Company.
2. Administration. Grants of options under the Plan are automatic. This
--------------
Plan is intended to be a "formula plan" for purposes of Section 16(b)of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and shall be
interpreted accordingly. The Board of Directors of the Company has authority to
interpret the Plan and otherwise administer the plan in accordance with its
terms.
3. Eligibility. Except as provided otherwise in this Paragraph 3, options
-----------
under the Plan shall be granted in accordance with Paragraph 5 to each member of
the Board of Directors of the Company or the Bank who is not an employee of the
Company or the Bank (an "Outside Director"); provided that shares of the
Company's Common Stock remain available for grant hereunder in accordance with
Paragraph 4. An Outside Director to whom an option is granted under the Plan
shall be referred to hereinafter as a "Grantee."
4. Shares Subject to Plan. The shares subject to the Plan shall be
----------------------
authorized but unissued or reacquired shares of the Company's Common Stock.
Subject to adjustment in accordance with the provisions of Paragraph 6 of the
Plan, the maximum number of shares of Common Stock for which options may be
granted under the Plan shall be 49,000 (including options granted under the Plan
since its inception in 1995) and the adoption of the Plan by the Board of
Directors of the Company shall constitute a reservation of 49,000 authorized but
unissued, or reacquired, shares of Common Stock for issuance only upon the
exercise of options granted under the Plan. In the event that any outstanding
option granted under the Plan for any reason expires or is terminated prior to
the end of the period during which options may be granted under the Plan, the
shares of Common Stock allocable to the unexercised portion of such option may
again be subject in whole or in part to any option granted under the Plan.
5. Terms and Conditions of Options. Options granted pursuant to the Plan
-------------------------------
shall be evidenced by Stock Option Agreements in such form as shall comply with
and be subject to the following terms and conditions:
(a) Grant. Each person who was an Outside Director both on November 2,
-----
1988 (the date of incorporation of the Bank) and on March 16, 1995 was granted
as of March 16, 1995 an option to purchase 1,000 shares of the Company's Common
Stock, subject to adjustment as provided in Section 6. On the day following
each subsequent annual meeting of the Company's shareholders ("Annual Meeting"),
beginning with the 1995 Annual Meeting and extending though the 2003 Annual
Meeting, but excluding the 1998 Annual Meeting, each Outside Director who was or
is serving in such capacity as of such date (whether or not serving as an
Outside Director on November 2, 1988) was and shall be granted an option to
purchase 200 shares of Common Stock, subject to adjustment pursuant to Section
6. On the day following the 1998 Annual Meeting, each Outside Director who is
serving in such capacity as of such date (whether or not serving as an Outside
Director on November 2, 1988) shall be granted an option to purchase 2,000
shares of Common Stock, subject to adjustment pursuant to Section 6 (the "1998
Options"). Each such day that options are to be granted under the Plan is
referred to hereinafter as a "Grant Date."
If on any Grant Date, shares of Common Stock are not available under this
Plan to grant to Outside Directors the full amount of a grant contemplated by
the immediately preceding paragraph, then each Outside Director shall receive an
option (a "Reduced Grant") to purchase shares of Common Stock in an amount equal
to the number of shares of Common Stock then available under the Plan divided by
the number of Outside Directors as of the applicable Grant Date. Fractional
shares shall be ignored and not granted.
<PAGE>
If a Reduced Grant has been made and, thereafter, during the term of this
Plan, additional shares of Common Stock become available for grant (e.g.,
because of the forfeiture or lapse of an option), then each person who was an
Outside Director both on the Grant Date on which the Reduced Grant was made and
on the date additional shares of Common Stock become available (a "Continuing
Outside Director") shall receive an additional option to purchase shares of
Common Stock. The number of newly available shares shall be divided equally
among the options granted to the Continuing Outside Directors; provided,
however, that the aggregate number of shares of Common Stock subject to a
Continuing Outside Director's additional option plus any prior Reduced Grant to
the Continuing Outside Director on the applicable Grant Date shall not exceed
200 shares of Common Stock (subject to adjustment pursuant to paragraph 6). If
more than one Reduced Grant has been made, available options shall be granted
beginning with the earliest such Grant Date.
(b) Option Price. The option price for each option granted under the Plan
------------
other than the 1998 Options shall be $16.00 per share. The option price for the
1998 Options shall be 105% of the Fair Market Value of the Common Stock on the
Grant Date. For purposes of this Plan, "Fair Market Value" means the mean
between the bid and offered prices as quoted by Nasdaq for such date, provided
that if it is determined that the fair market value is not properly reflected by
such Nasdaq quotations, Fair Market Value will be determined by such other
method as the Board of Directors determines in good faith to be reasonable.
(c) Medium and Time of Payment. The option price shall be payable in full
--------------------------
upon the exercise of an option in cash or by check. To the extent permitted
under Regulation T of the Federal Reserve Board, and subject to applicable
securities laws, options may be exercised through a broker in a so-called
"cashless exercise" whereby the broker sells the option shares and delivers cash
sales proceeds to the Company in payment of the exercise price. In no event may
shares of Common Stock be used as payment of the exercise price of the option.
(d) Term. Each option granted under the Plan shall, to the extent not
----
previously exercised, terminate and expire on the date ten (10) years after the
date of grant of the option, unless earlier terminated as provided hereinafter
in Section 5(g).
(e) Exercisability. Each option granted under the Plan shall be
--------------
exercisable, in whole or in part, six (6) months and one (1) day after the date
of grant.
(f) Method of Exercise. All options granted under the Plan shall be
------------------
exercised by an irrevocable written notice directed to the Secretary of the
Company at the Company's principal place of business. Except in the case of a
"cashless exercise" through a broker, such written notice shall be accompanied
by payment in full of the option price for the shares for which such option is
being exercised. In the case of a "cashless exercise," payment in full of the
option price for the shares for which such option is being exercised shall be
paid in cash by the broker from the sale proceeds. The Company shall make
delivery of certificates representing the shares for which an option has been
exercised within a reasonable period of time; provided, however, that if any
law, regulation or agreement requires the Company to take any action with
respect to the shares for which an option has been exercised before the issuance
thereof, then the date of delivery of such shares shall be extended for the
period necessary to take such action. Certificates representing shares for
which options are exercised under the Plan may bear such restrictive legends as
may be necessary or desirable in order to comply with applicable federal and
state securities laws. Nothing contained in the Plan shall be construed to
require the Company to register any shares of Common Stock underlying options
granted under the Plan.
(g) Effect of Termination of Directorship or Death.
-----------------------------------------------
(i) Termination of Directorship. Upon termination of any Grantee's
---------------------------
membership on the Board of Directors of the Company or the Bank for any
reason other than for cause or death, the options held by the Grantee under
the Plan shall continue uninterrupted until the date of expiration of the
options as provided by Paragraph 5(d) of the Plan. Any such exercise shall
be subject to the terms and conditions of the Plan. If the Grantee's
membership on the Board of Directors is terminated for cause, all options
granted to such Grantee shall expire upon such termination.
-A-2-
<PAGE>
(ii) Death. In the event of the death of a Grantee, the Grantee's
-----
personal representatives, heirs or legatees (the "Grantee's Successors")
may exercise the options held by the Grantee on the date of death, upon
proof satisfactory to the Company of their authority. The Grantee's
Successors must exercise any such options within one (1) year after the
Grantee's death and in any event prior to the date on which the options
expire as provided by Paragraph 5(d) of the Plan. Such exercise otherwise
shall be subject to the terms and conditions of the Plan.
(h) Nonassignability of Option Rights. No option shall be assignable or
---------------------------------
transferable by the Grantee except by will, by the laws of descent and
distribution or pursuant to a qualified domestic relations order as defined in
Title I of the Employee Retirement Income Security Act of 1974 and the Internal
Revenue Code of 1986, as amended. During the lifetime of the Grantee, the
option shall be exercisable only by the Grantee.
(i) Rights as Shareholder. Neither the Grantee nor the Grantee's
---------------------
Successors shall have rights as a shareholder of the Company with respect to
shares of Common Stock covered by the Grantee's option until the Grantee or the
Grantee's Successors become the holder of record of such shares.
(j) No Options after a Certain Time. No options shall be granted after
-------------------------------
the Grant Date which falls on the day immediately following the 2003 Annual
Meeting.
6. Adjustments.
-----------
(a) If any change is made in the stock subject to the Plan, or subject to
any option granted under the Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange of
shares, change in corporate structure or otherwise), the Plan and outstanding
options will be automatically and appropriately adjusted, including the maximum
number of shares subject to the Plan and the number of shares and price per
share of stock subject to outstanding options.
(b) In the event of: (i) a merger or consolidation in which the Company is
not the surviving corporation; (ii) a reverse merger in which the Company is the
surviving corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the merger into
other property, whether in the form of securities, cash other otherwise; or
(iii) any other capital reorganization in which more than fifty percent (50%) of
the shares of the Company entitled to vote are exchanged, then any surviving
corporation shall assume any options outstanding under the Plan or shall
substitute similar options for those outstanding under the Plan. If there is no
surviving corporation, all outstanding options shall expire.
7. Effective Date and Termination of Plan.
--------------------------------------
(a) Effective Date. The Plan first became effective on March 16, 1995.
--------------
The amendments effected in the Amended and Restated Plan shall become effective
on April 1, 1998, subject to approval of the Amended and Restated Plan by the
shareholders of the Company at the 1998 Annual Meeting. If the Amended and
Restated Plan is not so approved, the Plan shall continue as in effect prior to
such amendments.
(b) Termination. The Plan shall terminate immediately after the final
-----------
grant of options as provided in Section 5(j), but the Board of Directors may
terminate the Plan at any time prior to such date. Termination of the Plan
shall not alter or impair any of the rights or obligations under any option
theretofore granted under the Plan unless the affected Grantee shall so consent.
8. No Obligation to Exercise Option. The granting of an option shall
--------------------------------
impose no obligation upon the Grantee to exercise such option.
9. Amendment. The Board of Directors of the Company by majority vote may
---------
amend the Plan; provided, however, that without the approval of the shareholders
of the Company, no such amendment shall change:
-A-3-
<PAGE>
(a) The maximum number of shares of Common Stock as to which options may
be granted under the Plan (except by operation of the adjustment provisions of
the Plan); or
(b) The date on which the Plan will terminate as provided by Paragraph
7(b) of the Plan; or
(c) The number of shares of Common Stock subject to each option; or
(d) The option price as provided under Paragraph 5(b) of the Plan; or
(e) The provisions of Paragraph 3 of the Plan relating to the
determination of persons to whom options may be granted.
Any amendment to the Plan shall not, without the written consent of the
Grantee, affect such Grantee's rights under any option theretofore granted to
such Grantee.
-A-4-
<PAGE>
REVOCABLE PROXY
CRESCENT BANKING COMPANY
REVOCABLE PROXY BY AND ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 16, 1998
The undersigned hereby appoints J. Donald Boggus, Jr. and Arthur Howell, or
either of them, each with full power of substitution, as proxies to vote all
shares of the $1.00 par value common stock of Crescent Banking Company (the
"Company") which the undersigned is entitled to vote at the Annual Meeting of
Shareholders to be held THURSDAY, APRIL 16, 1998, at 2:00 p.m., local time, at
Pickens County Chamber of Commerce Community Center located at 500 Stegall
Drive, Jasper, Georgia, and at any postponement or adjournment thereof (the
"Annual Meeting").
SAID PROXIES WILL VOTE ON THE PROPOSAL SET FORTH IN THE NOTICE OF ANNUAL
MEETING AND PROXY STATEMENTS AS SPECIFIED ON THIS PROXY AND ARE AUTHORIZED TO
VOTE IN THEIR DISCRETION AS TO ANY OTHER BUSINESS WHICH MAY COME PROPERLY
BEFORE THE MEETING. IF A VOTE IS NOT SPECIFIED SAID PROXIES WILL VOTE FOR
APPROVAL OF THE PROPOSAL.
The Board of Directors recommends a Vote "For" the following proposal:
1. ELECTION OF DIRECTORS: Authority for the election of Charles Fendley and A.
James Elliott as Class I directors each to serve until the Annual Meeting of
Shareholders in 2001 or until their successors are elected and qualified.
FOR _____ WITHHOLD AUTHORITY _____
both nominees listed above to vote for nominees
(except as marked to written below.
the contrary below)
_____________________________________________________________________
The Board of Directors recommends a Vote "For" the following proposal:
2. AMENDMENT AND RESTATEMENT OF STOCK OPTION PLAN: Authority to approve the
Amended and Restated Stock Option Plan for Outside Directors, as described
under Proposal Two.
FOR _____ AGAINST _____
Please sign exactly as name appears on the label below. When shares are held
by joint tenants both should sign. When signing as attorney, 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.
COMMON SHARES: DATED: ________________, 1998
ACCOUNT NUMBER:
___________________________________
Signature
___________________________________
Signature if held jointly
PLEASE MARK, SIGN ABOVE, AND RETURN THIS PROXY PROMPTLY IN THE ENVELOPE
FURNISHED.
THIS PROXY IS SOLICITED BY THE COMPANY'S BOARD OF DIRECTORS AND MAY BE REVOKED
PRIOR TO ITS EXERCISE.