<PAGE>
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the registrant [X]
Filed by a party other than the registrant [_]
Check the appropriate box:
[_] Preliminary proxy statement
[X] Definitive proxy statement
[_] Definitive additional materials
[_] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
First Southern Bancshares, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
First Southern Bancshares, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] 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:
N/A
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions applies:
N/A
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
N/A
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
N/A
- --------------------------------------------------------------------------------
[_] 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:
N/A
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
N/A
- --------------------------------------------------------------------------------
(3) Filing party:
N/A
- --------------------------------------------------------------------------------
(4) Date filed:
N/A
- --------------------------------------------------------------------------------
<PAGE>
First Southern Bancshares, Inc.
March 17, 2000
Dear Stockholder:
You are cordially invited to attend the annual meeting of stockholders of
First Southern Bancshares, Inc. The meeting will be held at the main office of
First Southern Bank, located at 102 South Court Street, Florence, Alabama, on
Wednesday, April 19, 2000, at 10:00 a.m., Central Time.
The notice of annual meeting and proxy statement appearing on the following
pages describe the formal business to be transacted at the meeting. During the
meeting, we will also report on the operations of the Company. Directors and
officers of the Company, as well as a representative of Marmann, McCrary &
Associates, P.C., the Company's independent auditors, will be present to respond
to appropriate questions of stockholders.
It is important that your shares are represented at this meeting, whether
or not you attend the meeting in person and regardless of the number of shares
you own. To make sure your shares are represented, we urge you to complete and
mail the enclosed proxy card. If you attend the meeting, you may vote in person
even if you have previously mailed a proxy card.
We look forward to seeing you at the meeting.
Sincerely,
/s/ Charles L. Frederick, Jr.
Charles L. Frederick, Jr.
Chairman of the Board,
President and Chief Executive Officer
<PAGE>
FIRST SOUTHERN BANCSHARES, INC.
102 South Court Street
Florence, Alabama 35630
(256) 764-7131
________________________________________________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held On April 19, 2000
________________________________________________________________________________
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders of First
Southern Bancshares, Inc. ("Company") will be held at the main office of First
Southern Bank, 102 South Court Street, Florence, Alabama, on Wednesday, April
19, 2000, at 10:00 a.m., Central Time, for the following purposes:
1. To elect three directors each to serve for a term of three years;
2. To ratify the appointment of Marmann, McCrary & Associates, P.C.
as independent auditors for the Company for the fiscal year
ending December 31, 2000; and
3. To transact any other business that may properly come before the
meeting.
NOTE: The Board of Directors is not aware of any other business to come
before the meeting.
Only stockholders of record at the close of business on March 10, 2000
are entitled to receive notice of the meeting and to vote at the meeting and any
adjournment or postponement of the meeting.
Please complete and sign the enclosed form of proxy, which is solicited
by the Board of Directors, and mail it promptly in the enclosed envelope. The
proxy will not be used if you attend the meeting and vote in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ M. Kaye Townsend
M. Kaye Townsend
Secretary
Florence, Alabama
March 17, 2000
IMPORTANT: The prompt return of proxies will save the Company the expense of
further requests for proxies in order to ensure a quorum. A self-addressed
envelope is enclosed for your convenience. No postage is required if mailed in
the United States.
<PAGE>
PROXY STATEMENT
OF
FIRST SOUTHERN BANCSHARES, INC.
________________________________________________________________________________
ANNUAL MEETING OF STOCKHOLDERS
April 19, 2000
________________________________________________________________________________
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of First Southern Bancshares, Inc. ("First
Southern" or the "Company") to be used at the annual meeting of stockholders of
the Company. The annual meeting will be held at the main office of First
Southern Bank (the "Bank"), 102 South Court Street, Florence, Alabama on
Wednesday, April 19, 2000, at 10:00 a.m., Central Time. This proxy statement and
the enclosed proxy card are being first mailed to stockholders on or about March
17, 2000.
________________________________________________________________________________
VOTING AND PROXY PROCEDURE
________________________________________________________________________________
Who Can Vote at the Meeting
You are entitled to vote your First Southern common stock only if the
records of the Company show that you held your shares as of the close of
business on March 10, 2000. If your shares are held "in street name" in a stock
brokerage account or by a bank or other nominee, you are considered the
beneficial owner of those shares and these proxy materials are being forwarded
to you by your broker or nominee. As the beneficial owner, you have the right to
direct your broker or nominee how to vote your shares and are also invited to
attend the meeting. Your broker or nominee has enclosed a voting instruction
card for you to use to direct your broker or nominee how to vote your shares.
As of the close of business on that date, a total of 1,268,626 shares
of First Southern common stock were outstanding. Each share of common stock has
one vote. As provided in the Company's Certificate of Incorporation, record
holders of the Company's common stock who beneficially own, either directly or
indirectly, in excess of 10% of the Company's outstanding shares are not
entitled to any vote in respect of the shares held in excess of the 10% limit.
Attending the Meeting
If you are a beneficial owner of First Southern common stock held "in
street name" by a broker, bank or other nominee, you will need proof of
ownership to be admitted to the meeting. A recent brokerage statement or letter
from a bank or broker are examples of proof of ownership. If you want to vote
your shares of First Southern common stock held "in street name" in person at
the meeting, you will have to get a written proxy in your name from the broker,
bank or other nominee who holds your shares otherwise you will be unable to vote
those shares in person at the meeting.
<PAGE>
Vote Required
The annual meeting will be held if a majority of the outstanding shares
of common stock entitled to vote is represented at the meeting. If you return
valid proxy instructions or attend the meeting in person, your shares will be
counted for purposes of determining whether there is a quorum, even if you
abstain from voting. Broker non-votes also will be counted for purposes for
determining the existence of a quorum. A broker non-vote occurs when a broker,
bank or other 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 item and has not received voting instructions from the
beneficial owner.
In voting on the election of directors, you may vote in favor of all
nominees, withhold votes as to all nominees, or withhold votes as to specific
nominees. There is no cumulative voting for the election of directors. Directors
must be elected by a plurality of the votes cast at the annual meeting. This
means that the nominees receiving the greatest number of votes will be elected.
Votes that are withheld and broker non-votes will have no effect on the outcome
of the election. In voting on the ratification of the appointment of Marmann,
McCrary & Associates, P.C. as independent auditors, you may vote in favor of the
proposal, vote against the proposal or abstain from voting. This matter will be
decided by the affirmative vote of a majority of the votes cast at the annual
meeting. On this matter, abstentions and broker non-votes will have no effect on
the voting.
Voting by Proxy
This proxy statement is being sent to you by the Board of Directors of
First Southern for the purpose of requesting that you allow your shares of First
Southern common stock to be represented at the annual meeting by the persons
named in the enclosed proxy card. All shares of First Southern common stock
represented at the annual meeting by properly executed proxies will be voted
according to the instructions indicated on the proxy card. If you sign, date and
return a proxy card without giving voting instructions, your shares will be
voted as recommended by the Company's Board of Directors. The Board of Directors
recommends a vote FOR each of the nominees for director and FOR ratification of
Marmann, McCrary & Associates, P.C. as independent auditors.
If any matters not described in this proxy statement are properly
presented at the annual meeting, the persons named in the proxy card will use
their own judgment to determine how to vote your shares. This includes a motion
to adjourn or postpone the annual meeting in order to solicit additional
proxies. If the annual meeting is postponed or adjourned, your First Southern
common stock may be voted by the persons named in the proxy card on the new
annual meeting date as well, unless you have revoked your proxy. The Company
does not know of any other matters to be presented at the annual meeting.
You may revoke your proxy at any time before the vote is taken at the
meeting. To revoke your proxy you must either advise the Secretary of the
Company in writing before your common stock has been voted at the annual
meeting, deliver a later dated proxy, or attend the meeting and vote your shares
in person. Attendance at the annual meeting will not in itself constitute
revocation of your proxy.
If your First Southern common stock is held "in street name," you will
receive instructions from your broker, bank or other nominee that you must
follow in order to have your shares voted. Your broker or bank may allow you to
deliver your voting instructions via the telephone or the Internet. Please see
the instruction form provided by your broker, bank or other nominee that
accompanies this proxy statement.
2
<PAGE>
Participants in the Bank's ESOP or 401(k) Plan
If you participate in the First Southern Bank Employee Stock Ownership
Plan ("ESOP") or if you hold shares through the First Southern Bank 401(k) Plan,
the proxy card represents a voting instruction to the respective trustees of the
ESOP and the 401(k) Plan. Each participant in the ESOP and the 401(k) Plan may
direct the trustees as to the manner in which shares of First Southern common
stock allocated to the participant's plan account are to be voted. Subject to
the exercise of their fiduciary duties, the trustees of the ESOP will vote all
unallocated shares of common stock and allocated shares for which no timely
voting instructions are received in the same proportion as shares for which the
trustees have received voting instructions. As of March 10, 2000, 131,383 shares
have been allocated to each participants' accounts and 9,511 shares remain
unallocated. The trustees of the ESOP are Charles L. Frederick, Jr., Thomas N.
Ward and M. Kaye Townsend.
________________________________________________________________________________
STOCK OWNERSHIP
________________________________________________________________________________
The following table provides information as of March 10, 2000 with
respect to persons known to the Company to be the beneficial owners of more than
5% of the Company's outstanding common stock. A person may be considered to
beneficially own any shares of common stock over which he or she has, directly
or indirectly, sole or shared voting or investing power.
<TABLE>
<CAPTION>
Percent of
Number of Common Stock
Name and Address Shares Owned Outstanding
---------------- ------------ -----------
<S> <C> <C>
First Southern Bank 140,894 11.1%
Employee Stock Ownership Plan
102 South Court Street
Florence, Alabama 35630
H. M. Bobo 75,000/(1)/ 5.9
P.O. Box 1003
Florence, Alabama 35631
</TABLE>
-----------------------------
(1) Based on the Company's stock transfer records.
3
<PAGE>
The following table provides information about the shares of Company
common stock that may be considered to be beneficially owned by each nominee for
director of the Company and by all directors and executive officers of the
Company as a group as of March 10, 2000. Unless otherwise indicated, each of the
named individuals has sole voting power and sole investment power with respect
to the number of shares shown.
<TABLE>
<CAPTION>
Number of Shares
Number of That May Be Acquired Percent of Common
Shares Owned Within 60 Days By Stock Outstanding
Name (excluding options) Exercising Options (6)
--------------------------------- ------------------------------ ---------------------------------------------
<S> <C> <C> <C>
James E. Bishop 50,913/(1)/ 6,149 4.5%
Milka S. Duke 15,061/(2)/ 5,213 1.6
J. Acker Rogers 28,960/(3)/ 6,149 2.8
Kenneth A. Williams 12,575 6,149 1.5
S. Greg Beadle 1,935/(4)/ -0- 0.1
Steve McKinney 2,000 -0- 0.1
Charles L. Frederick, Jr. 36,085 12,299 1.9
Gary A. Gamble 6,068 6,149 0.9
Thomas N. Ward 47,462/(5)/ 12,299 3.8
All directors and executive 201,059 48,258 18.9%
officers as a group (9 persons)
</TABLE>
- -----------------------------
(1) Includes 2,705 shares owned by Mr. Bishop's spouse.
(2) Includes 1,050 shares owned by Ms. Duke's spouse, and 10,000 shares held in
Ms. Duke's IRA.
(3) Includes 1,000 shares owned by Mr. Rogers' spouse and 500 shares owned by
Mr. Rogers' daughter.
(4) Includes 1,150 shares owned by Mr. Beadle's spouse and 585 shares owned by
Mr. Beadle's son.
(5) Includes 4,635 shares owned by Mr. Ward's spouse and 25 shares owned
jointly by Mr. Ward's spouse and son, and 25 shares owned by Mr. Ward's
spouse and daughter.
(6) Percentages with respect to each person or group of persons have been
calculated based on 1,268,626 shares of First Southern common stock
outstanding and entitled to vote as of March 10, 2000, plus the number of
shares of the Company's common stock which each person or group of persons
has the right to acquire within 60 days of March 10, 2000 by the exercise
of stock options.
4
<PAGE>
________________________________________________________________________________
PROPOSAL 1 -- ELECTION OF DIRECTORS
________________________________________________________________________________
The Company's Board of Directors consists of nine members. Seven
directors are independent and two are members of management. The Board is
divided into three classes with three-year staggered terms, with approximately
one-third of the directors elected each year. The nominees for election to serve
for a three-year term, or until their respective successors have been elected
and qualified, are James E. Bishop, Milka S. Duke and J. Acker Rogers. All of
the nominees are currently directors of the Company and the Bank.
In accordance with the Board's age limitation policies, Kenneth
Williams will retire from the Board effective the date of the annual meeting.
The Board will adopt a resolution to be effective the date of the annual meeting
to reduce the size of the Board to eight members.
The Board of Directors intends to vote the proxies solicited by it for
the election of the nominees named above. If any nominee is unable to serve, the
persons named in the proxy card would vote your shares to approve the election
of any substitute proposed by the Board of Directors. Alternatively, the Board
of Directors may adopt a resolution to reduce the size of the Board. At this
time, the Board of Directors knows of no reason why any nominee might be unable
to serve.
The Board of Directors recommends a vote "FOR" the election of all of
the nominees.
Information regarding the nominees for election at the annual meeting
is provided below. Unless otherwise stated, each nominee has held his current
occupation for the last five years. The age indicated in each nominee's
biography is as of December 31, 1999. The indicated period for service as a
director includes service as a director of the Bank.
Nominees for Election as Director
The directors standing for election are:
James E. Bishop is owner and president of an automobile and truck
dealership. Age 51. Director since 1991.
Milka S. Duke is a retired former executive of the Bank. Age 73.
Director since 1987.
J. Acker Rogers is the owner and president of a general insurance
agency. Age 53. Director since 1991.
Directors Continuing in Office
The following directors have terms ending in 2001:
Charles L. Frederick, Jr. is the Chairman of the Board, President and
Chief Executive Officer of the Company and the Bank. Age 61. Director since
1988.
5
<PAGE>
Gary A. Gamble is the president of a land development company. He is
also the partner in an export company, a partner for another land development
company and a consultant for an automotive supply company. Age 47. Director
since 1992.
The following directors have terms expiring in 2002:
Thomas N. Ward is the Executive Vice President and Chief Operating
Officer of the Company and the Bank. Age 44. Director since 1988.
Kenneth A. Williams is the retired partner of an oil distribution
company. Age 75. Director since 1967.
Steve McKinney is the president of a fastener distribution company. Age
44. Director since 1998.
S. Greg Beadle is the president of an electric supply company. Age 49.
Director since 1998.
Meetings and Committees of the Board of Directors
The business of the Company and the Bank is conducted through meetings
and activities of their Boards of Directors and their committees. During the
fiscal year ended December 31, 1999, the Board of Directors of the Company held
12 meetings and the Board of Directors of the Bank held 12 meetings. No director
attended fewer than 75% of the total meetings of the Boards of Directors and
committees on which such director served.
The Audit Committee consists of Messrs. Williams (Chairman), Bishop,
Gamble and Beadle. It meets as needed, but no fewer than at least once every six
months, and is responsible for reviewing and evaluating the internal controls
and accounting procedures and for recommending the annual appointment of the
independent auditor. The Audit Committee also meets with the independent auditor
to review the results of the annual audit and any related matters. The Audit
Committee met two times during the fiscal year ended December 31, 1999.
The Investment Committee consists of Messrs. Rogers (Chairman), Gamble
and Williams. It meets quarterly, and is responsible for monitoring that the
Bank's investment policies are implemented correctly and effectively. In
addition, the Investment Committee is responsible for reviewing certain loan
applications and requests for loan purchases and participations and other
investment matters. The Investment Committee meets as needed, but no fewer than
at least once every six months. The Investment Committee met seven times during
the fiscal year ended December 31, 1999.
The Personnel Committee consists of Ms. Duke (Chairman) and Messrs.
Bishop, Rogers and McKinney. It meets as needed, but no fewer than at least once
every six months, and is responsible for reviewing and recommending annual
salary levels for executive officers, including the Chief Executive Officer, to
the Board of Directors and for reviewing and establishing personnel policies and
procedures. The Personnel Committee met four times during the fiscal year ended
December 31, 1999.
The Nominating Committee, consisting of the entire Board of Directors,
considers and recommends the nominees for director to stand for election at the
Company's annual meeting of shareholders. The Nominating Committee met once
during the fiscal year ended December 31, 1999.
6
<PAGE>
Directors' Compensation
Directors of the Company receive a quarterly retainer of $550.
Directors of the Bank, who also serve as directors of the Company, receive a fee
of $750 per month with the exception of the Chairman of the Board who receives a
fee of $850 per month. Non-officer directors receive an additional $100 for
committee meetings. Total fees paid to directors of the Company and the Bank
during the fiscal year ended December 31, 1999 were $136,000.
________________________________________________________________________________
EXECUTIVE COMPENSATION
________________________________________________________________________________
Summary Compensation Table
The following information is furnished for Messrs. Frederick and Ward.
No other executive officer of the Company or its subsidiaries received salary
and bonus of $100,000 or more during the year ended December 31, 1999.
<TABLE>
<CAPTION>
Annual Compensation/(1)/
---------------------------
All
Other
Name and Principal Position Year Salary/(2)/ Bonus/(3)/ Compensation/(4)/
------------------------------- --------- ------------ ------------- -----------------
<S> <C> <C> <C> <C>
Charles L. Frederick, Jr. ..... 1999 $137,900 $20,917 $19,343
Chairman of the Board, 1998 139,603 5,000 50,017
President and Chief 1997 136,939 -- 63,648
Executive Officer
Thomas N. Ward ................ 1999 $116,700 $17,583 $16,322
Executive Vice President 1998 119,754 5,000 12,963
and Chief Operating Officer 1997 115,758 -- 6,844
</TABLE>
- ---------------------------
(1) The Bank pays all compensation. Excludes certain additional benefits
received by each individual, the aggregate amounts of which do not exceed
10% of the particular individual's total annual salary and bonus.
(2) Salaries for Messrs. Frederick and Ward include $12,400 and $11,200 in
director's fees, respectively.
(3) Represents incentive bonus based on targeted goals for return on assets,
return on equity and net income of First Southern.
(4) Consists of employer contributions to 401(k) plan ($11,402) and ESOP
allocation ($24,263).
Option Grants. No options were granted to Messrs. Frederick and Ward
during the fiscal year ended December 31, 1999.
7
<PAGE>
Option Exercise/Value Table. The following information is provided for
Messrs. Frederick and Ward for the fiscal year ended December 31, 1999.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options at
Options at Fiscal Fiscal
Year-End Year-End/(1)/
------------------------ -------------------------------------------------------
Acquired Value
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ---------------------------------- ------------ ----------- ------------ -------------- ---------- --------------
<S> <C> <C> <C> <C> <C> <C>
Charles L. Frederick, Jr. ........ $ -0- $ -0- 12,299 8,200 $ -- $ --
Thomas N. Ward.................... -0- -0- 12,299 8,200 -- --
</TABLE>
- -------------------------------
(1) All options have an exercise price of $11.75 per share, which equals the
market value of First Southern common stock on December 31, 1999. The
options are considered "in-the-money" only if the exercise price is less
than the market price.
Employment Agreements. The Company and Bank (collectively, "Employers")
have entered into three-year employment agreements with Messrs. Frederick and
Ward providing for current salary levels of $125,500 and $105,500, respectively,
which amounts will be paid by the Bank and which may be increased at the
discretion of the Board of Directors or an authorized committee of the Board.
The salary of each executive officer may not be decreased during the term of the
employment agreement without the prior written consent of the officer. On each
anniversary of the commencement date of the agreement, the term of the agreement
may be extended by action of the Board of Directors for an additional year
unless a notice of termination of the agreement is given by the executive
officer. The Employers may terminate the agreements for just cause at any time
or in certain events specified by federal regulations.
The employment agreements provide for severance payments and other
benefits in the event of involuntary termination of employment in connection
with any change in control of the Employers. Severance payments also will be
provided on a similar basis in connection with a voluntary termination of
employment within 12 months of a change in control where the executive officers
are assigned duties inconsistent with their positions, duties, responsibilities
and status immediately prior to such change in control. The term "change in
control" is defined in the agreements as, among other things, any time during
the period of employment when a change of control is deemed to have occurred
when (a) a person other than the Company purchases shares of Common Stock
pursuant to a tender or exchange offer for such shares, (b) any person (as such
term is used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of
1934, as amended) is or becomes the beneficial owner, directly or indirectly, of
securities of the Company representing 25% or more of the combined voting power
of the Company's then outstanding securities, (c) the membership of the Board of
Directors changes as the result of a contested election, or (d) stockholders of
the Company approve a merger, consolidation, sale or disposition of all or
substantially all of the Company's assets, or a plan of partial or complete
liquidation.
The severance payments from the Employers will equal 2.99 times Messrs.
Frederick's and Ward's average annual compensation during the preceding five
years. Such amount will be paid in a lump sum within 10 business days following
the termination of employment. The Internal Revenue Code of 1986, as amended,
provides that certain severance payments which equal or exceed three times the
base compensation
8
<PAGE>
of the individual are deemed to be "excess parachute payments" if they are
contingent upon a change in control. Individuals receiving excess parachute
payments are subject to a 20% excise tax on the amount of such excess payments,
and the Employers would not be entitled to deduct the amount of such excess
payments.
The agreement restricts Messrs. Frederick's and Ward's right to compete
against the Employers for a period of one year from the date of termination of
the agreement if Messrs. Frederick and Ward voluntarily terminate their
employment, except in the event of a change in control.
________________________________________________________________________________
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
________________________________________________________________________________
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors, and persons who own more than 10% of
any registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Executive officers, directors and greater than 10% stockholders are required by
regulation to furnish the Company with copies of all Section 16(a) reports they
file.
Based solely on its review of the copies of the reports it has received
and written representations provided to the Company from the individuals
required to file the reports, the Company believes that during the fiscal year
ended December 31, 1999, Mr. Charles L. Frederick, Jr. and Ms. Milka S. Duke did
not promptly report certain transactions in the Company's common stock on Forms
4 due to an administrative error. Mr. Frederick's late filing involved the sale
of common stock. Ms. Duke's late filing involved the exercise of stock options.
________________________________________________________________________________
TRANSACTIONS WITH MANAGEMENT
________________________________________________________________________________
Federal regulations require that all loans or extensions of credit to
executive officers and directors of insured financial institutions must be made
on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons,
except for loans made pursuant to programs generally available to all employees,
and must not involve more than the normal risk of repayment or present other
unfavorable features. The Bank, therefore, is prohibited from making any new
loans or extensions of credit to executive officers and directors at different
rates or terms than those offered to the general public, except for loans made
under programs generally available to all employees, and the Bank has adopted a
policy to this effect. In addition, loans made to a director or executive
officer in an amount that, when aggregated with the amount of all other loans to
such person and his or her related interests, are in excess of the greater of
$25,000 or 5% of the institution's capital and surplus (up to a maximum of
$500,000) must be approved in advance by a majority of the disinterested members
of the Board of Directors. The aggregate amount of loans by the Bank to its
executive officers and directors was approximately $3.6 million at December 31,
1999.
Director J. Acker Rogers is part owner of the insurance firm of Rogers,
Carlton & Associates, Inc., from which the Bank has purchased insurance for the
past several years. Rogers, Carlton & Associates, Inc. received approximately
$37,000 from the Bank during the fiscal year ended December 31, 1999.
9
<PAGE>
________________________________________________________________________________
PROPOSAL 2 -- RATIFICATION OF INDEPENDENT AUDITORS
________________________________________________________________________________
The Board of Directors has appointed Marmann, McCrary & Associates,
P.C. to be its independent auditors for the 2000 fiscal year, subject to the
ratification by stockholders. A representative of Marmann, McCrary & Associates,
P.C. is expected to be present at the annual meeting to respond to appropriate
questions from stockholders and will have the opportunity to make a statement
should he desire to do so.
If the ratification of the appointment of the independent auditors is
not approved by a majority of the votes cast by stockholders at the annual
meeting, the Board of Directors may consider other independent auditors.
The Board of Directors recommends that stockholders
vote "FOR" the ratification of the appointment of
independent auditors.
________________________________________________________________________________
MISCELLANEOUS
________________________________________________________________________________
The Company will pay the cost of this proxy solicitation. The Company
will reimburse brokerage firms and other custodians, nominees and fiduciaries
for reasonable expenses incurred by them in sending proxy materials to the
beneficial owners of First Southern common stock. In addition to soliciting
proxies by mail, directors, officers and regular employees of the Company may
solicit proxies personally or by telephone without receiving additional
compensation.
The Company's Annual Report to Stockholders has been mailed to
stockholders as of the close of business on March 10, 2000. Any stockholder who
has not received a copy of the Annual Report may obtain a copy by writing to the
Secretary of the Company. The Annual Report is not to be treated as part of the
proxy solicitation material or as having been incorporated in this proxy
statement by reference.
A copy of the Company's Form 10-KSB for the fiscal year ended December
31, 1999, as filed with the Securities and Exchange Commission, will be
furnished without charge to stockholders as of the close of business on March
10, 2000 upon written request to M. Kaye Townsend, Corporate Secretary, First
Southern Bancshares, Inc., Florence, Alabama 35630.
10
<PAGE>
________________________________________________________________________________
STOCKHOLDER PROPOSALS
________________________________________________________________________________
Proposals that stockholders seek to have included in the proxy
statement for the Company's next annual meeting must be received by the Company
no later than November 16, 2000. If next year's annual meeting is held on a date
more than 30 calendar days from April 19, 2001, a stockholder proposal must be
received by a reasonable time before the proxy solicitation for such annual
meeting is made. Any stockholder proposals will be subject to the requirements
of the proxy rules adopted by the Securities and Exchange Commission.
The Company's Certificate of Incorporation provides that in order for a
stockholder to make nominations for the election of directors or proposals for
business to be brought before the annual meeting, a stockholder must deliver
notice of such nominations and/or proposals to the Secretary not less than 30
nor more than 60 days before the date of the annual meeting; provided that if
less than 31 days' notice of the annual meeting is given to stockholders, such
notice must be delivered not later than the close of the tenth day following the
day on which notice of the annual meeting was mailed to stockholders or public
disclosure of the meeting date was made. A copy of the Certificate of
Incorporation may be obtained from the Company.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ M. Kaye Townsend
M. Kaye Townsend
Corporate Secretary
Florence, Alabama
March 17, 2000
11
<PAGE>
REVOCABLE PROXY
FIRST SOUTHERN BANCSHARES, INC.
[X] PLEASE MARK ANNUAL MEETING OF STOCKHOLDERS
VOTES AS IN
THIS SAMPLE April 19, 2000
_______________________________
The undersigned hereby appoints the official Proxy Committee of the Board
of Directors, consisting of Charles L. Frederick, Jr. and Thomas N. Ward, with
full powers of substitution, to act as proxy for the undersigned, and to vote
all shares of common stock of First Southern Bancshares, Inc. (the "Company")
owned of record by the undersigned at the Annual Meeting of Stockholders, to be
held at the main office of First Southern Bank located at 102 South Court
Street, Florence, Alabama, on Wednesday, April 19, 2000, at 10:00 a.m., Central
Time, and at any and all adjournments thereof, as designated hereon with respect
to the matters set forth herein and described in the accompanying Proxy
Statement and, in their discretion, for the election of a person to the Board of
Directors if any nominee named herein becomes unable to serve or for good cause
will not serve and with respect to any other business that may properly come
before the meeting. Any prior proxy or voting instructions are hereby revoked.
Please be sure to sign and date this
Proxy in the box below
Dated ________________
________________________________
STOCKHOLDER SIGN ABOVE
________________________________
CO-HOLDER (IF ANY) SIGN ABOVE
1. The election as directors of all nominees listed (except as marked to
the contrary below).
James E. Bishop Milka S. Duke J. Acker Rogers
FOR ALL
FOR WITHHOLD EXCEPT
--- -------- ------
[_] [_] [_]
INSTRUCTION: To withhold authority to vote for any individual nominee, mark
"EXCEPT" and write that nominee's name in the space provided below.
________________________________________________________________________________
2. The ratification of the appointment of Marmann, McCrary & Associates,
P.C. as independent auditors for the fiscal year ending December
31, 2000.
FOR AGAINST ABSTAIN
--- ------- -------
[_] [_] [_]
This proxy card will also be used to provide voting instructions to the
trustees for any shares of common stock of the Company allocated to participants
under First Southern Bank Employee Stock Ownership Plan and the First Southern
Bank 401(k) Plan.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
EACH OF THE LISTED PROPOSALS.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY WILL BE VOTED "FOR" EACH OF THE PROPOSALS LISTED. IF ANY OTHER
BUSINESS IS PRESENTED AT THE MEETING, INCLUDING WHETHER OR NOT TO ADJOURN THE
MEETING, THIS PROXY WILL BE VOTED BY THE PROXIES IN THEIR BEST JUDGMENT. AT THE
PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED
AT THE ANNUAL MEETING.
<PAGE>
FIRST SOUTHERN BANCSHARES, INC.
The above-signed acknowledges receipt from the Company, prior to the
execution of this proxy, of a Notice of Annual Meeting of Stockholders, a Proxy
Statement dated for the Annual Meeting of Stockholders, and the Annual Report to
Stockholders.
Please sign exactly as your name appears on this proxy card. When signing
as attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder may sign but only one signature
is required.
PLEASE ACT PROMPTLY
SIGN, DATE AND MAIL YOUR PROXY CARD TODAY
