<PAGE>
<PAGE>
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. ___)
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use
[ ] Definitive Proxy Statement of the Commission Only
[x] Definitive Additional Materials (as permitted by Rule
[ ] Soliciting Material Pursuant to 14a-6(e)(2))
Rule 14a-11(c) or Rule 14a-12
HAYWOOD BANCSHARES, INC.
- ----------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- ----------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(1) and 0-11.
1. Title of each class of securities to which transaction
applies:
2. Aggregate number of securities to which transaction
applies:
3. Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth
the amount on which the filing fee is calculated and
state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
1. Amount Previously Paid:
2. Form, Schedule or Registration Statement No.:
3 Filing Party:
4. Date Filed:
<PAGE>
<PAGE>
HAYWOOD BANCSHARES, INC.
370 NORTH MAIN STREET
WAYNESVILLE, NORTH CAROLINA 28786
December 6, 1999
Dear Shareholder:
We have previously sent you proxy materials for the special
meeting of shareholders of Haywood to be held on December 16,
1999. At the special meeting, Haywood shareholders will vote on
the merger of Haywood with and into a wholly-owned subsidiary of
Century South Banks, Inc.
Included with your proxy materials, was a form of
election/letter of transmittal by which you could indicate to
the exchange agent whether you wanted to receive CSBI common
stock, cash or both for your Haywood shares in the merger.
We understand, however, that many shareholders who hold
their shares in brokerage accounts either did not receive their
packages until just before the election deadline or, in some
cases, did not receive a form of election/letter of
transmittal in their packages. In order to give everyone an
adequate opportunity to make an election, Century South Banks,
Inc. has agreed to extend the deadline for making elections
until December 30, 1999.
We are enclosing with this letter another form of
election/letter of transmittal in case you have not received
one. If you have not yet submitted a form of election/letter of
transmittal, we urge you to carefully read and complete the one
enclosed. If you have already properly submitted your form, you
may disregard this letter and the exchange agent will process
your request as originally made. However, if you would like to
change your election, you may do so on the enclosed form as long
as it is properly completed. You may send a properly completed
form to the exchange agent in the enclosed self-addressed
envelope. No postage is required if mailed in the United
States.
If we can help you further, please call me at (828) 456-
9092.
Sincerely,
/s/ Larry R. Ammons
Larry R. Ammons
President and Managing Officer
<PAGE>
<PAGE>
FORM OF ELECTION/LETTER OF TRANSMITTAL
FOR USE BY SHAREHOLDERS OF HAYWOOD BANCSHARES, INC.
In connection with the proposed merger of Haywood
Bancshares, Inc. ("Haywood") with and into a wholly-owned
subsidiary of Century South Banks, Inc. ("CSBI"), you may
indicate your preference for receiving CSBI common stock, cash
or a combination of both for your shares of Haywood common
stock. This Form of Election/Letter of Transmittal is to be
used for making your election and must be accompanied by the
certificate(s) for your shares of Haywood common stock (or
affidavit(s) and indemnification for lost share certificate(s)
or guarantee(s) of delivery of share certificate(s) as described
below).
You must use this form:
. To tell Registrar and Transfer Company (the "Exchange
Agent") whether you prefer to receive shares of CSBI
common stock ("Stock Consideration"), cash ("Cash
Consideration") or both in the merger in exchange for
your shares of Haywood common stock; and
. To submit your certificate(s) of Haywood common
stock (or affidavit(s) and indemnification for lost
share certificate(s) or guarantee(s) of delivery of
share certificate(s) as described below).
If you fail to submit this Form of Election/Letter of
Transmittal by the deadline described below, or if you fail to
enclose your Haywood common stock certificate(s) (or
affidavit(s) and indemnification for lost share certificate(s)
or guarantee(s) of delivery of share certificate(s)) with this
Form of Election/Letter of Transmittal, you will be treated as
though you expressed no preference between Stock Consideration
and Cash Consideration.
THE DEADLINE FOR SUBMITTING THIS FORM OF ELECTION/LETTER
OF TRANSMITTAL TO THE EXCHANGE AGENT, TOGETHER WITH YOUR SHARE
CERTIFICATES (OR AFFIDAVIT(S) AND INDEMNIFICATION FOR LOST SHARE
CERTIFICATE(S) OR GUARANTEE(S) OF DELIVERY OF SHARE
CERTIFICATE(S)), IS 5:00 P.M., ATLANTA, GEORGIA TIME, ON
DECEMBER 30, 1999 (THE "ELECTION DEADLINE").
To meet the Election Deadline, your completed Form of
Election/Letter of Transmittal must be received by the Exchange
Agent by the Election Deadline at one of the addresses set forth
below. Delivery of this Form of Election/Letter of Transmittal
to an address other than as set forth above will not constitute
a valid delivery. You must sign this Form of Election/Letter of
Transmittal where indicated below and complete the Substitute
Form W-9 provided below.
If your Haywood common stock certificate(s) is (are) not
available at the time you send this Form of Election/Letter of
Transmittal to the Exchange Agent (but are not lost, stolen or
destroyed), you may instead provide a guarantee of its (their)
delivery as set forth in General Instruction 7 below. In such a
case, you must within four Nasdaq National Stock Market trading
days of the date you submit this Form of Election/Letter of
Transmittal, deliver to the Exchange Agent the Haywood common
stock certificate(s) representing the shares in respect of which
you provided the guarantee of delivery. If you do not deliver
your stock certificate(s) within such four day period, your
election will not be valid.
If your Haywood common stock certificate(s) is (are) lost,
stolen or destroyed, see General Instruction 13 below. In such
a case, you must execute an affidavit and indemnification
regarding the loss, theft or destruction and submit them with
this Form of Election/Letter of Transmittal.
PLEASE READ THE SPECIAL ELECTION INSTRUCTIONS AND THE
GENERAL INSTRUCTIONS IN THIS FORM OF ELECTION/LETTER OF
TRANSMITTAL CAREFULLY BEFORE COMPLETING THIS FORM OF
ELECTION/LETTER OF TRANSMITTAL.
The Exchange Agent is:
Registrar and Transfer Company
<TABLE>
<CAPTION>
BY MAIL: BY HAND OR OVERNIGHT COURIER:
------- ----------------------------
<S> <C>
Registrar and Transfer Company Registrar and Transfer Company
Reorg Department c/o The Depository Trust Company
10 Commerce Drive 55 Water Street, 1st Floor
Cranford, New Jersey 07016 New York, New York 10041-0099
</TABLE>
For information call toll free: 1-800-368-5948
<PAGE>
<PAGE>
ELECTION(S), SPECIAL ISSUANCE, PAYMENT AND DELIVERY
(SEE GENERAL INSTRUCTIONS 6, 9, 10 AND 11 BELOW)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
BOX A
ELECTION(S) AND DESCRIPTION OF HAYWOOD SHARES ENCLOSED
Attach additional sheets if necessary
- ---------------------------------------------------------------------------------------------------------
| | | Number of Shares Elected
| | | to Receive***
- ---------------------------------------------------------------------------------------------------------
| | | |
| | Number of | |
Name(s) and Address(es) of Registered Holder(s)| | Shares | |
(If blank, please fill in exactly as name(s) | Certificate| Represented | Stock | Cash
appear(s) on certificate(s))* | Number** | by Certificate |Consideration|Consideration
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
| | | |
| | | |
----------------------------------------------------------
| | | |
| | | |
----------------------------------------------------------
| | | |
| | | |
----------------------------------------------------------
| | | |
| | | |
----------------------------------------------------------
| | | |
| | | |
- ---------------------------------------------------------------------------------------------------------
Total Number of Shares: | | | |
| | | |
- ---------------------------------------------------------------------------------------------------------
</TABLE>
* In the case of a delivery using the Guarantee of Delivery
procedures, print the name(s) of the registered holder(s)
exactly as it (they) will appear on the certificate(s) when
delivered.
** Certificate number(s) is (are) not required if
certificate(s) will be delivered by using the Guarantee of
Delivery procedures.
*** To be completed only if 100 shares or more are owned.
_____ Check here if the above election(s) represent(s) a
revocation of any earlier election(s).
_____ Check here if any of your certificate(s) have been lost,
stolen or destroyed and indicate the number of shares
represented thereby: ________________
Nominee record holders, which include a nominee, trustee
or any other person that holds shares in any capacity whatsoever
on behalf of another person or entity, are directed to General
Instruction 14.
2
<PAGE>
<PAGE>
- ----------------------------------------------------------------
BOX B
SPECIAL ISSUANCE AND PAYMENT INSTRUCTIONS
(See General Instructions 6, 9, 10 and 11)
- ----------------------------------------------------------------
To be completed ONLY if the certificate(s) for shares of CSBI
common stock representing Stock Consideration and/or the check
representing Cash Consideration or cash in lieu of fractional
shares, as the case may be, is to be issued in the name of
someone other than the undersigned. NOTE: THE PERSON NAMED IN
THESE SPECIAL ISSUANCE AND PAYMENT INSTRUCTIONS MUST BE THE
PERSON WHO COMPLETES THE SUBSTITUTE FORM W-9.
Issue the certificate representing the Stock Consideration
and/or the check representing the Cash Consideration or cash in
lieu of fractional shares to:
Name ________________________________________________
(Please Print)
Address _____________________________________________
_____________________________________________________
(Zip Code)
_____________________________________________________
(Taxpayer Identification Number or Social
Security Number)
(See Substitute Form W-9 Below)
If you complete this box, you will need a signature guarantee by
an eligible institution. See General Instruction 6.
- ----------------------------------------------------------------
- ----------------------------------------------------------------
BOX C
SPECIAL DELIVERY INSTRUCTIONS
(See General Instructions 6 and 11)
- ----------------------------------------------------------------
To be completed ONLY if the certificate(s) for shares of CSBI
common stock representing Stock Consideration and/or the check
representing Cash Consideration or cash in lieu of fractional
shares, as the case may be, is to be sent to someone other than
the undersigned or to the undersigned at an address other than
that shown above in Box A.
Mail the certificate representing Stock Consideration and/or the
check representing the Cash Consideration or cash in lieu of
fractional shares to:
Name ________________________________________________
(Please Print)
Address _____________________________________________
_____________________________________________________
(Zip Code)
[ ] Check this box if this is a permanent change of address.
If you complete this box, you will need a signature guarantee by
an eligible institution. See General Instruction 6.
- ----------------------------------------------------------------
3
<PAGE>
<PAGE>
SUBSTITUTE FORM W-9
(SEE GENERAL INSTRUCTION 12 AND "IMPORTANT TAX INFORMATION,"
BELOW)
PAYER'S NAME: REGISTRAR AND TRANSFER COMPANY
Please provide your social security number or other taxpayer
identification number on the following Substitute Form W-9 and
certify therein that you are not subject to backup withholding
<TABLE>
<CAPTION>
_________________________________________________________________________________________________________
SUBSTITUTE | Part 1 - PLEASE PROVIDE YOUR TIN IN THE BOX AT |
FORM W-9 | RIGHT AND CERTIFY BY SIGNING AND DATING BELOW. | __________________
| | SOCIAL SECURITY NUMBER(S)
| | OR EMPLOYER
| | IDENTIFICATION NUMBER(S)
______________________________________________________________________________
<S> <C> <C>
Department of the Treasury |
Internal Revenue Service | Part 2 - CHECK THE BOX IF YOU ARE NOT SUBJECT TO BACKUP WITHHOLDING
| BECAUSE (1) YOU ARE EXEMPT FROM BACKUP WITHHOLDING, (2) YOU HAVE NOT BEEN
| NOTIFIED THAT YOU ARE SUBJECT TO BACKUP WITHHOLDING AS A RESULT OF FAILURE
| TO REPORT ALL INTEREST OR DIVIDENDS OR (3) THE INTERNAL REVENUE SERVICE
| HAS NOTIFIED YOU THAT YOU ARE NO LONGER SUBJECT TO BACKUP WITHHOLDING.[ ]
______________________________________________________________________________
Payer's Request for | CERTIFICATION: UNDER PENALTIES OF PERJURY, |
Taxpayer Indentification | I CERTIFY THAT THE INFORMATION PROVIDED ON THIS |
Number ("TIN") | FORM IS TRUE, CORRECT AND COMPLETE. |
| |
| THE INTERNAL REVENUE SERVICE DOES NOT REQUIRE | Part 3 -
| YOUR CONSENT TO ANY PROVISION OF THIS DOCUMENT |
| OTHER THAN THE CERTIFICATIONS REQUIRED TO | AWAITING TIN [ ]
| AVOID BACKUP WITHHOLDING. |
| |
| Signature: _________________________________ |
| Date: ______________________________________ |
_________________________________________________________________________________________________________
</TABLE>
NOTE: ANY FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT
IN A $50 PENALTY IMPOSED BY THE INTERNAL REVENUE SERVICE
AND BACKUP WITHHOLDING OF 31% OF ANY CASH PAYMENTS MADE
TO YOU PURSUANT TO THE MERGER. PLEASE REVIEW THE
ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE
IF YOU CHECKED THE BOX IN PART 3 OF THE SUBSTITUTE FORM W-9
________________________________________________________________
CERTIFICATE OF AWAITING TAX IDENTIFICATION NUMBER
I CERTIFY UNDER PENALTIES OF PERJURY THAT A TAX IDENTIFICATION
NUMBER HAS NOT BEEN ISSUED TO ME, AND EITHER THAT (A) I HAVE
MAILED OR DELIVERED AN APPLICATION TO RECEIVE A TAX
IDENTIFICATION NUMBER TO THE APPROPRIATE INTERNAL REVENUE
SERVICE CENTER OR SOCIAL SECURITY ADMINISTRATION OFFICE, OR (B)
I INTEND TO MAIL OR DELIVER AN APPLICATION IN THE NEAR FUTURE.
I UNDERSTAND THAT IF I DO NOT PROVIDE A TAX IDENTIFICATION
NUMBER, 31% OF ALL REPORTABLE PAYMENTS MADE TO ME WILL BE
WITHHELD, UNTIL I PROVIDE SUCH NUMBER.
_______________________________ ___________________
SIGNATURE DATE
________________________________________________________________
4
<PAGE>
<PAGE>
SPECIAL ELECTION INSTRUCTIONS
The appropriate elections must be made in Box A above in
order to elect Stock Consideration or Cash Consideration with
respect to each share of Haywood common stock represented by the
certificate(s) surrendered herewith.
Because of certain limitations on the amount of Stock
Consideration and Cash Consideration to be issued in the merger,
you may not receive the form of merger consideration you elect.
If the elections result in an oversubscription of either Stock
Consideration or Cash Consideration, the procedures for
allocating shares of CSBI common stock and cash set forth in the
merger agreement and described in the proxy statement/prospectus
furnished with this Form of Election/Letter of Transmittal will
be followed by the Exchange Agent. See "THE MERGER --
Allocation Rules" in the proxy statement/prospectus and General
Instruction 4. ALL DECISIONS BY THE EXCHANGE AGENT WITH RESPECT
TO SUCH PROCEDURES SHALL BE FINAL AND BINDING.
If you wish to make a stock election or a cash election,
you must ensure that the Exchange Agent receives a properly
completed Form of Election/Letter of Transmittal prior to the
Election Deadline. All Haywood shareholders submitting Forms of
Election/Letters of Transmittal after such time will be deemed
to have made no election, regardless of the election specified
on the form. If you do not wish to make an election, you are
not required to submit this Form of Election/Letter of
Transmittal prior to the Election Deadline or prior to the
effective time of the merger, but your certificates must be
surrendered in order to receive the merger consideration.
THE EXCHANGE AGENT RESERVES THE RIGHT TO DEEM THAT YOU
HAVE MADE NO ELECTION IF:
. YOU FAIL TO FOLLOW THE INSTRUCTIONS ON THIS FORM OF
ELECTION/LETTER OF TRANSMITTAL (INCLUDING SUBMISSION OF YOUR
CERTIFICATE(S) OR AFFIDAVIT(S) AND INDEMNIFICATION FOR LOST
SHARE CERTIFICATE(S) OR GUARANTEE(S) OF DELIVERY OF SHARE
CERTIFICATE(S)) OR OTHERWISE FAIL TO PROPERLY MAKE AN ELECTION;
OR
. A COMPLETED FORM OF ELECTION/LETTER OF TRANSMITTAL
(INCLUDING SUBMISSION OF YOUR CERTIFICATE(S) OR AFFIDAVIT(S) AND
INDEMNIFICATION FOR LOST SHARE CERTIFICATE(S) OR GUARANTEE(S) OF
DELIVERY OF SHARE CERTIFICATE(S)) IS NOT RECEIVED BY THE
ELECTION DEADLINE.
In order to receive the merger consideration, (i) this
Form of Election/Letter of Transmittal must be completed and
signed in the space provided below, (ii) the Substitute Form W-9
must be completed and signed in the space provided above, and
(iii) this Form of Election/Letter of Transmittal must be mailed
or delivered with your certificate(s) or affidavit(s) and
indemnification for lost share certificate(s) or guarantee(s) of
delivery of share certificate(s)) to the Exchange Agent at
either of the addresses set forth above. In order to properly
make a stock election or cash election, these actions must be
taken in a timely fashion such that the Form of Election/Letter
of Transmittal is received by the Exchange Agent by the Election
Deadline.
The method of delivery of your certificate(s) and all
other required documents is at your election and risk. However,
if the certificates are sent by mail, we recommend that they be
sent by registered mail, appropriately insured, with return
receipt requested.
Unless otherwise indicated above in Box B, "Special
Issuance and Payment Instructions," you will be issued Stock
Consideration, Cash Consideration or both in exchange for your
enclosed certificate(s). Similarly, unless otherwise indicated
above in Box C, "Special Delivery Instructions," Stock
Consideration, Cash Consideration or both will be mailed to you
at the address shown in Box A above. In the event that both
Boxes B and C are completed, the merger consideration will be
issued in the name of, and mailed to, the person or entity so
indicated at the address so indicated. Appropriate signature
guarantees must be included with respect to shares for which
Special Issuance and Payment Instructions have been given.
CONSUMMATION OF THE MERGER IS SUBJECT TO THE SATISFACTION
OF CERTAIN CONDITIONS. NO PAYMENTS RELATED TO ANY SURRENDERED
CERTIFICATES WILL BE MADE PRIOR TO THE EFFECTIVE TIME OF THE
MERGER.
5
<PAGE>
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE
SPECIAL ELECTION INSTRUCTIONS AND THE GENERAL
INSTRUCTIONS CAREFULLY
To Registrar and Transfer Company:
In connection with the merger of Haywood Bancshares, Inc.
("Haywood") with and into a wholly-owned subsidiary of Century
South Banks, Inc. ("CSBI"), and pursuant to the merger agreement
by and among Haywood, CSBI and CSBI's wholly-owned subsidiary,
the undersigned hereby makes the election or elections set forth
herein and surrenders for cancellation to Registrar and Transfer
Company, as Exchange Agent, certificate(s) representing all of
the undersigned's shares of Haywood common stock, listed in Box
A above in exchange for either:
. a fraction of a share of CSBI common stock
(the "Stock Consideration") determined by a formula
that will depend upon the market value of CSBI common
stock. If CSBI's market value is between $24.00 and
$27.00 per share, the Stock Consideration will be
0.8874. However, if CSBI's market value is greater
than $27.00 per share, the Stock Consideration will be
decreased so that the undersigned's Haywood common
stock will be valued at approximately $23.95 per share.
If CSBI's market value is lower than $24.00 per share,
the Stock Consideration will be increased so that the
undersigned's Haywood common stock will be valued at
approximately $21.30 per share; or
. an amount of cash (the "Cash Consideration")
equal to the Stock Consideration multiplied by the
market value of CSBI common stock.
Pursuant to the merger agreement, and as described in the
proxy statement/prospectus furnished with this Form of
Election/Letter of Transmittal (including all documents
incorporated therein, and as it may be amended from time to
time, the "Proxy Statement/Prospectus"), it is understood that
in the event Haywood's shareholders' equity is less than $21
million as of the end of the month immediately preceding the
effective time of the merger, the exchange ratio will be reduced
proportionately.
It is also understood that the market value of CSBI common
stock will be equal to the average closing price of CSBI common
stock on the Nasdaq National Market over a 20-day trading period
ten days prior to the effective time of the merger. It is
further understood that, pursuant to the merger agreement and as
described in the Proxy Statement/Prospectus under "THE MERGER --
Allocation Rules," 50% of the aggregate merger consideration
paid to Haywood shareholders will be paid in CSBI common stock
and 50% will be paid in cash. Accordingly, the undersigned
understands that, if necessary, the Exchange Agent will
allocate among Haywood shareholders shares of CSBI common
stock and cash so that 50% of the aggregate merger consideration
will be paid in CSBI common stock and 50% will be paid in cash.
In addition, it is understood that the Exchange Agent will pay
cash for the undersigned's shares of Haywood common stock if
less than 100 shares are owned by the undersigned. Cash will
also be paid in lieu of any fractional shares of CSBI common
stock otherwise issuable in connection with the merger.
The undersigned further understands that the elections
referred to above are subject to certain terms, conditions and
limitations that are set forth in the merger agreement, the
General Instructions and Special Election Instructions hereto
and the Proxy Statement/Prospectus. ADDITIONAL COPIES OF THIS
FORM OF ELECTION/LETTER OF TRANSMITTAL AND THE PROXY
STATEMENT/PROSPECTUS MAY BE REQUESTED FROM CSBI AT 60 MAIN
STREET WEST, DAHLONEGA, GEORGIA 30533, ATTENTION: SUSAN
ANDERSON. The filing of this Form of Election/Letter of
Transmittal with the Exchange Agent is acknowledgment of the
receipt of the Proxy Statement/Prospectus. The undersigned
understands and acknowledges that all questions as to the
validity, form and eligibility of any election and surrender of
the shares hereunder shall be determined by the Exchange Agent,
and such determination shall be final and binding.
The undersigned hereby represents and warrants that the
undersigned is, as of the date hereof, and will be, as of the
effective time of the merger, the registered holder of the
shares of Haywood common stock represented by the certificate(s)
surrendered herewith, with good title to the above-described
shares and full power and authority (i) to sell, assign and
transfer such shares, free and clear of all liens, claims and
encumbrances, and not subject to any adverse claims and (ii) to
make the election or elections set forth herein. The
undersigned will, upon request, execute any additional documents
necessary or desirable to complete the surrender and exchange of
such shares. The undersigned hereby irrevocably appoints the
Exchange Agent, as agent of the undersigned, to effect the
exchange pursuant to the merger agreement and the General
Instructions hereto. All authority conferred or agreed to be
conferred in the Form of Election/Letter of Transmittal shall be
binding upon the successors, assigns, heirs,
6
<PAGE>
<PAGE>
executors, administrators and legal representatives of the
undersigned and shall not be affected by, and shall survive, the
death or incapacity of the undersigned.
The undersigned authorizes and instructs the Exchange
Agent to deliver certificate(s) for the undersigned's shares of
Haywood common stock and receive on behalf of the undersigned,
in exchange for the shares represented thereby, any certificate
for shares of CSBI common stock or any check for cash issuable
in the merger pursuant to the merger agreement. If the
certificate(s) is (are) not delivered herewith, there is
furnished herewith (i) a guarantee of delivery of such
certificate(s) from a member of a registered national securities
exchange, a member of the National Association of Securities
Dealers, Inc. or a commercial bank or trust company having an
office in the United States (provided below) in accordance with
General Instruction 6 or (ii) an affidavit and indemnification
regarding the loss, theft or destruction of such certificate(s)
reasonably acceptable to CSBI in accordance with General
Instruction 13.
<TABLE>
<CAPTION>
_________________________________________________________________________________________________
SIGN HERE
IMPORTANT: ALSO COMPLETE AND SIGN THE
SUBSTITUTE FORM W-9 ON PAGE 4
<S> <C>
___________________________________ Name(s): ___________________________________
(Signature(s) of Owner(s)) (Please Print)
___________________________________ Capacity (full title): _____________________
Must be signed by registered holder(s)
as name(s) appear(s) on stock certificate(s). Address: ___________________________________
If signed by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a ____________________________________________
corporation or other person acting in a (Zip Code)
fiduciary or representative capacity, the
capacity of the person signing should be ____________________________________________
indicated. (See General Instruction 9). (Area Code and Telephone Number)
____________________________________________
(Taxpayer Identification or Social
Security Number)
Dated: _____________________________________
_________________________________________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
_________________________________________________________________________________________________
SIGNATURE GUARANTEE
(REQUIRED ONLY IN CASE SPECIFIED IN GENERAL INSTRUCTION 6)
<S> <C>
The undersigned hereby guarantees the signature(s) _____________________________________
which appear(s) on this Form of Election/Letter (Name of Eligible Institution
of Transmittal Issuing Guarantee)
(Please Print)
Dated: __________________________________________ _____________________________________
(Fix Medallion Stamp Above)
_________________________________________________________________________________________________
</TABLE>
THE EXCHANGE AGENT HAS BEEN INSTRUCTED NOT TO MAKE ANY
EXCHANGE OF YOUR SHARES UNTIL THIS FORM OF ELECTION/LETTER OF
TRANSMITTAL HAS BEEN EXECUTED AND DELIVERED TO THE EXCHANGE
AGENT TOGETHER WITH YOUR STOCK CERTIFICATE(S) (OR AFFIDAVIT(S)
AND INDEMNIFICATION FOR LOST SHARE CERTIFICATE(S) OR
GUARANTEE(S) OF DELIVERY OF SHARE CERTIFICATE(S)).
7
<PAGE>
<PAGE>
IF YOUR CERTIFICATE(S) HAS (HAVE) BEEN LOST, STOLEN OR
DESTROYED AND YOU REQUIRE ASSISTANCE IN REPLACING IT (THEM), SEE
GENERAL INSTRUCTION 13 BELOW. IF YOU SUBMIT A GUARANTEE OF
DELIVERY IN PLACE OF YOUR STOCK CERTIFICATE(S), YOUR STOCK
CERTIFICATE(S) MUST BE DELIVERED WITHIN FOUR NASDAQ NATIONAL
STOCK MARKET TRADING DAYS THEREAFTER. THEREFORE, IF YOU WISH TO
MAKE AN EFFECTIVE ELECTION, IT IS CRITICAL THAT YOU ACT
IMMEDIATELY TO OBTAIN REPLACEMENT STOCK CERTIFICATE(S).
Shareholders whose share certificates are not immediately
available or who cannot deliver their share certificates and all
other documents required hereby to the Exchange Agent prior to
the Election Deadline, and who wish to make an election, must do
so pursuant to the procedures for lost share certificates
described in General Instruction 13 or the guaranteed delivery
procedures set forth in General Instruction 2.
Information as to the federal income tax consequences of
receiving Stock Consideration or Cash Consideration in exchange
for your shares of Haywood common stock is set forth under the
caption "THE MERGER -- Important Federal Income Tax
Consequences" in the Proxy Statement/Prospectus. See also the
information in this Form of Election/Letter of Transmittal under
the heading "Important Tax Information." You are urged, in
addition, to consult with your tax advisor.
GUARANTEE OF DELIVERY
(See General Instruction 2)
If your Haywood common stock certificates are not available
prior to the Election Deadline, the following Guarantee may be
completed by an eligible institution and the election made
herein will be valid if such certificates, together with a
completed Form of Election/Letter of Transmittal, are in fact
delivered to the Exchange Agent within four Nasdaq National
Stock Market trading days after the date of execution hereof.
- ----------------------------------------------------------------
GUARANTEE OF DELIVERY
(TO BE USED IF HAYWOOD COMMON STOCK CERTIFICATE(S) OR
AFFIDAVIT(S) AND INDEMNIFICATION FOR LOST
SHARE CERTIFICATE(S)ARE NOT ATTACHED HEREWITH.
NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a member firm of a registered national
securities exchange or of the National Association of Securities
Dealers, Inc. or a commercial bank or trust company having an
office or a correspondent in the United States, hereby
guarantees that, within four Nasdaq National Stock Market
trading days from the date of this Form of Election/Letter of
Transmittal, certificates representing the shares of Haywood
common stock covered hereby in proper form for transfer and any
required documents, together with a completed Form of
Election/Letter of Transmittal, will be deposited by the
undersigned with the Exchange Agent. IF THIS GUARANTEE OF
DELIVERY IS COMPLETED, YOU WILL NEED A SIGNATURE GUARANTEE BY AN
ELIGIBLE INSTITUTION. SEE GENERAL INSTRUCTION 6.
Dated: ____________________ ___________________________
(Firm -- Please Print)
Number of Shares: __________ ___________________________
(Authorized Signature)
___________________________
(Address)
___________________________
___________________________
(Area Code and Telephone
Number)
- ----------------------------------------------------------------
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GENERAL INSTRUCTIONS
This Form of Election/Letter of Transmittal, or a copy of
it, is to be properly completed and submitted to Registrar and
Transfer Company (the "Exchange Agent") by 5:00 p.m., Atlanta,
Georgia time, on December 30, 1999 (the "Election Deadline") if
you desire to make a stock election or a cash election. ALL
SHAREHOLDERS OF HAYWOOD BANCSHARES, INC. ("HAYWOOD") MUST
SURRENDER THEIR HAYWOOD COMMON STOCK CERTIFICATE(S) TO THE
EXCHANGE AGENT IN ORDER TO RECEIVE THE MERGER CONSIDERATION.
Until a record holder's certificate(s) are received by the
Exchange Agent at one of the addresses set forth on the first
page of this Form of Election/Letter of Transmittal, together
with such documents as the Exchange Agent may require, and until
the same are processed for exchange by the Exchange Agent, such
holders will not receive any certificates representing CSBI
common stock ("Stock Consideration") and/or a check representing
cash ("Cash Consideration") or cash in lieu of fractional shares
(if any) in exchange for their certificate(s). No interest will
accrue on Cash Consideration, the cash in lieu of fractional
shares or dividends. If your certificate(s) for shares of
Haywood common stock is (are) lost, stolen or destroyed, please
refer to General Instruction 13 below.
YOU MUST MAKE THE APPROPRIATE ELECTION(S) IN BOX A ABOVE
TO MAKE AN EFFECTIVE STOCK ELECTION OR CASH ELECTION.
Your election is subject to certain terms, conditions and
limitations that have been set out in the merger agreement and
the proxy statement/prospectus that accompanied this Form of
Election/Letter of Transmittal. The merger agreement is
included as Appendix A to the proxy statement/prospectus.
Additional copies of the proxy statement/prospectus may be
requested from Century South Banks, Inc. ("CSBI") at 60 Main
Street West, Dahlonega, Georgia 30533. The filing of this Form
of Election/Letter of Transmittal with the Exchange Agent is
acknowledgment of the receipt of the proxy statement/prospectus.
1. ELECTION GENERALLY. Each Haywood shareholder of
record is entitled to make a stock election or a cash election,
provided the Form of Election/Letter of Transmittal for any
holder making such elections is properly completed and received
by the Exchange Agent prior to the Election Deadline. All
Haywood shareholders of record must complete Box A, in order to
receive the desired merger consideration. To properly complete
Box A, the number of each certificate surrendered herewith must
be written in the column under the heading "Certificate Number,"
and the number of shares represented by each certificate
surrendered herewith in connection with a specific election
should be written in the appropriate column under the heading
"Number of Shares Represented by Certificate" beside each
certificate number. Shareholders of record wishing to make more
than one election may do so on one Form of Election/Letter of
Transmittal by specifying under the appropriate heading the
number of shares for which Stock Consideration and Cash
Consideration is desired. All shareholders must surrender their
certificates to the Exchange Agent in order to receive the
merger consideration. All shareholders should see "Important
Tax Information" below for important tax consequences of various
elections.
2. ELECTION DEADLINE AND GUARANTEE OF DELIVERY. For
any stock election or cash election contained herein to be
considered, this Form of Election/Letter of Transmittal,
properly completed, and the related certificate(s) (or a proper
guarantee of delivery as described below) must be received by
the Exchange Agent, at one of the addresses shown on page 1 of
this Form of Election/Letter of Transmittal, no later than 5:00
p.m., Atlanta, Georgia time, on December 30, 1999.
Haywood shareholders whose stock certificate(s) is (are)
not immediately available or who cannot deliver their share
certificates and all other required documents to the Exchange
Agent on or prior to the Election Deadline may make an effective
election by:
. completing (i) Box A, (ii) the box entitled
"Guarantee of Delivery" with any required signature
guarantees and delivering such documents to the
Exchange Agent prior to the Election Deadline; and
. delivering their Haywood common stock
certificate(s), with any required signatures and
other documents required by this Form of
Election/Letter of Transmittal within four Nasdaq
National Stock Market trading days after the
execution of such Guarantee of Delivery.
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In addition, at the time the certificate(s) are delivered
pursuant to the Guarantee of Delivery, the guarantor must
submit to the Exchange Agent another Form of Election/Letter of
Transmittal with only the section entitled "Notice of Delivery
Under Guarantee" properly completed (or must otherwise provide
such information to the Exchange Agent). If the guarantor fails
to deliver the certificate(s) in accordance with the guaranteed
delivery procedures contained herein, without limitation of any
other recourse, any purported election with respect to the
shares subject to such guarantee will be void.
3. REVOKING OR CHANGING FORM OF ELECTION/LETTER OF
TRANSMITTAL. Election(s) may be revoked or amended, but only by
written notice received by the Exchange Agent prior to the
Election Deadline. Any certificate(s) representing shares of
Haywood common stock that have been submitted to the Exchange
Agent in connection with an election shall be returned without
charge to the record holder in the event such holder's election
is revoked and the holder requests in writing the return of the
certificate(s). Upon any such revocation, unless a duly
completed Form of Election/Letter of Transmittal is thereafter
submitted in accordance with the procedures set forth in the
proxy statement/prospectus, the shares shall be no election
shares, as described therein.
4. ELECTION PROCEDURES/ALLOCATION. As set forth herein
and in the proxy statement/prospectus, 50% of the aggregate
merger consideration paid to Haywood shareholders will be paid
in CSBI common stock and 50% will be paid in cash. BECAUSE OF
THE LIMITATIONS ON THE NUMBER OF SHARES OF CSBI COMMON STOCK TO
BE CONVERTED INTO THE RIGHT TO RECEIVE STOCK CONSIDERATION AND
CASH CONSIDERATION UNDER THE ELECTION AND ALLOCATION PROCEDURES
DESCRIBED HEREIN AND IN THE PROXY STATEMENT/PROSPECTUS, NO
ASSURANCE CAN BE GIVEN THAT HAYWOOD SHAREHOLDERS WILL RECEIVE
THE FORM OF MERGER CONSIDERATION THEY REQUESTED.
5. NO FRACTIONAL INTERESTS. No certificate representing
fractional shares of CSBI common stock will be issued. The
Exchange Agent will remit cash without interest in lieu of
fractional shares of CSBI. No Haywood shareholder shall be
entitled to dividends, voting rights or any other rights in
respect of any fractional share.
6. GUARANTEE OF SIGNATURES. Signatures on this Form of
Election/Letter of Transmittal must be guaranteed if Boxes B
and/or C ("Special Issuance and Payment Instructions" and
"Special Delivery Instructions") or the "Guarantee of Delivery"
section has (have) been completed. In addition, if there is a
name correction or a change in name that does not involve a
change in ownership (as described in General Instruction 9(e)
below) the signatures on this Form of Election/Letter of
Transmittal must be guaranteed. Signatures required to be
guaranteed on this Form of Election/Letter of Transmittal must
be guaranteed by an eligible guarantor institution pursuant to
Rule 17Ad-15 promulgated under the Securities Exchange Act of
1934, as amended (generally, a member firm of the New York Stock
Exchange or any bank or trust company which is a member of the
Medallion Program). Public notaries cannot execute acceptable
guarantees of signatures.
7. DELIVERY OF FORM OF ELECTION/LETTER OF TRANSMITTAL
AND CERTIFICATES. This Form of Election/Letter of Transmittal,
properly completed and duly executed, together with the
certificate(s) representing shares, of Haywood common stock
should be delivered to the Exchange Agent at one of the
addresses set on the first page of this Form of Election/Letter
of Transmittal. The method of delivery of the certificates and
all other required documents is at your election and risk;
however, if such certificates are sent by mail, it is
recommended that they be sent by registered mail, appropriately
insured, with return receipt requested.
8. INADEQUATE SPACE. If the space provided on this
Form of Election/Letter of Transmittal is inadequate, the
certificate numbers and the numbers of shares represented
thereby should be listed on additional sheets and attached
hereto.
9. SIGNATURES, STOCK POWERS AND ENDORSEMENTS.
(a) Except as otherwise set forth below, all signatures
must correspond exactly with the name written on the face of the
Haywood common stock certificate(s) without alteration,
variation or any change whatsoever.
(b) If the certificate(s) surrendered is (are) held of
record by two or more joint owners, all such owners must sign
this Form of Election/Letter of Transmittal.
(c) If any surrendered shares are registered in different
names on several certificates, it will be necessary to complete,
sign and submit as many separate Forms of Election/Letters of
Transmittal as there are different registrations of
certificates.
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<PAGE>
(d) If this Form of Election/Letter of Transmittal is
signed by a person(s) other than the listed record holder(s) of
the certificate(s) (except as set forth in paragraphs (e) and
(f) below), such certificate(s) must be endorsed or accompanied
by appropriate stock powers properly executed, in either case
signed exactly as the name(s) of the record holder(s) appears on
such certificate(s). The signature(s) of the person(s) other
than the record holder(s) must be guaranteed as described above
in General Instruction 6. Haywood shareholders must follow the
guidelines below:
(i) Endorsement and Guarantee. The certificate(s)
surrendered must be properly endorsed (or accompanied by
appropriate stock powers properly executed) by the registered
holder(s) of such certificate(s) to the person who is to receive
Stock Consideration and/or Cash Consideration or cash in lieu of
fractional shares (if any). The signature(s) of the holder(s)
on the endorsement or stock powers must correspond with the
name(s) written upon the face of the certificate(s) in every
particular, with the signature(s) on the certificate(s) (or
stock powers) guaranteed as described above in General
Instruction 6.
(ii) Transferee's Signature. The Form of
Election/Letter of Transmittal must be signed by the transferee
or assignee or his or her agent, and should not be signed by the
transferor or assignor. The signature of such transferee or
assignee must be guaranteed as described above in General
Instruction 6.
(e) For a name correction or for a change in name which
does not involve a change in ownership, proceed as follows: For
a change in name by marriage, etc., the Form of Election/Letter
of Transmittal should be signed, e.g., "Mary Doe, now by
marriage Mary Jones." For a correction in name, the form of
Election/Letter of Transmittal should be signed, e.g., "James E.
Brown, incorrectly inscribed as J.E. Brown" The signature in
each case should be guaranteed as described above in General
Instruction 6.
(f) If this Form of Election/Letter of Transmittal is
signed by a trustee, executor, administrator, guardian,
attorney-in-fact, officer of a corporation or other person
acting in a fiduciary or representative capacity and such person
is not the record holder of the accompanying certificates, he or
she must indicate the capacity when signing and must submit
proper evidence of his authority to act. See also General
Instruction 15.
10. SPECIAL ISSUANCE AND PAYMENT AND DELIVERY
INSTRUCTIONS. Indicate the name and/or address of the person(s)
to whom Stock Consideration and/or the check representing Cash
Consideration or cash in lieu of fractional shares (if any) is
to be issued and/or sent, if different from the name and/or
address of the person(s) signing this Form of Election/Letter of
Transmittal.
11. STOCK TRANSFER TAXES. In the event that any transfer
or other taxes become payable by reason of the issuance of the
merger consideration in any name other than that of the Haywood
shareholder, such transferee or assignee must pay such tax to
the Exchange Agent or must establish to the satisfaction of the
Exchange Agent that such tax has been paid.
12. WITHHOLDING. Each surrendering Haywood shareholder
is required to provide the Exchange Agent with such holder's
correct Taxpayer Identification Number ("TIN") on the Substitute
Form W-9 and to certify whether such holder is subject to backup
withholding. The TIN that must be provided is that of the
Haywood shareholder with respect to the certificate(s)
surrendered herewith or of the last transferee appearing on the
transfers attached to or endorsed on such certificate(s) (or, if
a check is made payable to another person as provided in Box B,
"Special Issuance and Payment Instructions," then the TIN of
such person). Failure to provide the information on the
Substitute Form W-9 may subject the surrendering shareholder to
31% federal income tax withholding on payments made to such
surrendering holder with respect to the shares and on future
dividends paid by CSBI. If the Exchange Agent is not provided
with a TIN, CSBI will withhold 31% of all cash payments
(including Cash Consideration and/or cash in lieu of fractional
shares (if any) to be issued pursuant to the merger) and
dividends until a TIN is provided to the Exchange Agent.
13. LOST, STOLEN OR DESTROYED CERTIFICATES. Unless
affidavits and indemnification for lost share certificates or
guarantees of delivery of share certificates are delivered with
their Forms of Election/Letters of Transmittal, Haywood
shareholders cannot submit an effective Form of Election/Letter
of Transmittal without attaching their certificates for shares
of Haywood common stock. If a certificate has been lost, stolen
or destroyed, shareholders are urged to call the Exchange Agent
toll-free at (800) 368-5948 immediately to receive instructions
as to the steps they must take in order to effect an exchange of
their shares. In addition, the Exchange Agent will provide
shareholders with a form of an affidavit and indemnification
regarding the loss, theft or destruction of their certificates
that is in form and substance reasonably acceptable to CSBI.
Such form must be completed and submitted as an alternative to
attaching Haywood common stock certificate(s) to this Form of
Election/Letter of Transmittal. Shareholders who execute such
form will be required to post an indemnity bond in a
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<PAGE>
customary amount as determined by CSBI. Shareholders also may
be required to pay a fee to obtain a replacement for a
certificate that has been lost, stolen or destroyed.
14. ELECTIONS, CERTIFICATES AND SHARE ALLOCATIONS. Each
Haywood shareholder of record is entitled to make a stock
election or a cash election, provided the Form of
Election/Letter of Transmittal for any holder making such
elections is properly completed and received by the Exchange
Agent prior to the Election Deadline. All Haywood shareholders
must complete Box A in order to receive the desired merger
consideration. To properly complete Box A, the number of each
certificate surrendered herewith must be written in the column
under the heading "Certificate Number," and the number of shares
represented by each certificate surrendered herewith in
connection with a specific election should be written in the
appropriate column under the heading "Number of Shares" beside
each certificate number. Shareholders of record wishing to make
more than one election may do so on one Form of Election/Letter
of Transmittal by specifying under the appropriate heading the
number of shares for which a stock election or cash election is
desired, including multiple elections with respect to shares
represented by a single certificate. All shareholders must
surrender their certificates to the Exchange Agent in order to
receive the merger consideration. You should see "Important Tax
Information" below for important tax consequences of various
elections.
15. HOLDERS WHO ARE NOMINEES, TRUSTEES OR OTHER
REPRESENTATIVES. If you are a Haywood shareholder of record and
hold such shares as a nominee, trustee or in another
representative or fiduciary capacity, you may submit one or more
Election Forms/Letters of Transmittal covering the aggregate
number of shares of Haywood common stock held by you for the
beneficial owners for whom you are making an election. You
must, however, certify that each Election Form/Letter of
Transmittal covers all of the shares of Haywood common stock
held by you for any single beneficial owner. You may be
required to provide the Exchange Agent with such documents
and/or additional certifications, if requested, in order to
satisfy the Exchange Agent that you hold such shares of Haywood
common stock for a particular beneficial owner. If any shares
of Haywood common stock are not covered by an effective Election
Form/Letter of Transmittal, they will be deemed shares for which
you made no election.
16. MISCELLANEOUS. Neither CSBI nor the Exchange Agent
is under any duty to give notification of defects in any Form of
Election/Letter of Transmittal. CSBI and the Exchange Agent
shall not incur any liability for failure to give such
notification, and each of CSBI and the Exchange Agent has the
absolute right to reject any and all Forms of Election/Letters
of Transmittal not in proper form or to waive any irregularities
in any Form of Election/Letter of Transmittal.
17. INFORMATION AND ADDITIONAL COPIES. Information and
additional copies of this Form of Election/Letter of Transmittal
may be obtained by telephoning Susan Anderson, Senior Vice
President of CSBI, at (706) 864-1111.
18. DELIVERY OF CSBI COMMON STOCK AND PAYMENT CHECKS.
As soon as practicable after the merger becomes effective, the
Exchange Agent will issue and mail to Haywood shareholders who
properly completed and submitted this Form of Election/Letter of
Transmittal certificate(s) representing Stock Consideration
and/or the check representing Cash Consideration (and, if
applicable, a check in lieu of fractional shares).
For those Haywood shareholders who do not submit an
effective Form of Election/Letter of Transmittal, the Exchange
Agent will forward to them, within 20 days after the merger
becomes effective, a Letter of Transmittal for their use to send
in their certificate(s) for shares of Haywood common stock,
containing appropriate instructions for surrendering such
certificate(s) at that time. After the Exchange Agent receives
their stock certificate(s) with a properly completed Letter of
Transmittal, it will issue and mail to them certificate(s)
representing Stock Consideration and/or the check representing
Cash Consideration (and, if applicable, a check in lieu of
fractional shares).
IF YOU HAVE NOT ALREADY RETURNED YOUR PROXY CARD RELATING
TO THE SPECIAL MEETING OF HAYWOOD SHAREHOLDERS, DO NOT ENCLOSE
IT WITH THIS FORM OF ELECTION. YOUR PROXY CARD SHOULD BE
RETURNED IN THE POSTAGE-PAID ENVELOPE ENCLOSED WITH THE PROXY
STATEMENT/PROSPECTUS FOR THAT PURPOSE.
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IMPORTANT TAX INFORMATION
1. WITHHOLDING. Under federal income tax law, the
Exchange Agent is required to file a report with the IRS
disclosing any payments of cash being made to each holder of
Certificates pursuant to the merger agreement and to impose 31%
"backup withholding" if required. If the correct certifications
on Substitute Form W-9 are not provided, a $50 penalty may be
imposed by the IRS and payments made for Shares may be subject
to backup withholding of 31%. Withholding is also required if
the IRS notifies the recipient that such recipient is subject to
backup withholding as a result of a failure to report interest
and dividends.
In order to avoid backup withholding of federal income tax
resulting from a failure to provide a correct certification, a
U.S. citizen or resident or other U.S. entity must, unless an
exemption applies, provide the Exchange Agent with his or her
correct TIN on the Substitute Form W-9 which is a part of this
Form of Election/Letter of Transmittal. See General Instruction
11. Such person must certify under penalties of perjury that
such number is correct and not otherwise subject to backup
withholding. The TIN that must be provided is that of the
registered holder of the Certificate(s) or of the last
transferee appearing on the transfers attached to or endorsed on
the Certificate(s) (or, if a check is made payable to another
person as provided in the box entitled "Special Issuance and
Payment Instructions," then the TIN of such person). Foreign
investors should consult their tax advisors regarding the need
to complete IRS Form W-8 and any other forms that may be
required.
Backup withholding is not an additional federal income
tax. Rather, the federal income tax liability of a person
subject to backup withholding will be reduced by the amount of
tax withheld. If backup withholding results in an overpayment
of taxes, a refund may be obtained from the IRS.
Please read "Guidelines for Certification of Taxpayer
Identification Number (TIN) on Substitute Form W-9," set forth
below, for additional important information on how to complete
the Substitute Form W-9.
2. ELECTIONS. As set forth in the proxy
statement/prospectus, the merger is intended to qualify as a
reorganization within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended, for U.S. federal
income tax purposes. Provided that the merger qualifies as a
reorganization (i) neither Haywood nor CSBI will recognize any
gain or loss for U.S. federal income tax purposes as a result of
the merger and (ii) the U.S. federal income tax consequences to
a Haywood shareholder of the receipt of the merger consideration
in exchange for shares of Haywood common stock will depend on
whether the merger consideration such shareholder receives is
composed of shares of CSBI common stock, cash or a combination
of CSBI common stock and cash. In general, a Haywood
shareholder will not recognize any gain or loss as a result of
the receipt of CSBI common stock in exchange for Haywood common
stock, but will recognize gain, if any, with respect to any cash
received. Under the merger agreement, a Haywood shareholder may
be required to receive some cash even if he elects to receive
only CSBI common stock, or to receive some CSBI common stock
even if he elects to receive only cash. You should carefully
read the section under "THE MERGER Important Federal Income
Tax Consequences" in the proxy statement/prospectus furnished
with this Form of Election/Letter of Transmittal for more
information regarding tax consequences of various elections.
3. REPORTING REQUIREMENTS. Income tax regulations
require Haywood shareholders to submit detailed information
regarding the exchange of Haywood common stock for the merger
consideration with their federal income tax returns. In
addition, if a Haywood shareholder owns two or more "blocks" of
Haywood common stock, the determination of such shareholder's
taxable gain and tax basis for shares of CSBI common stock may
need to be computed separately for each such block. Each
Haywood shareholder should consult with his tax advisor about
such matters and other tax consequences of the merger in light
of his individual circumstances, including the application of
any federal, state, local or foreign law.
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GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ("TIN") ON SUBSTITUTE FORM W-9
(SECTION REFERENCES ARE TO THE INTERNAL REVENUE CODE)
NAME
If you are an individual, you must generally provide the name
shown on your social security card. However, if you have
changed your last name, for instance, due to marriage, without
informing the Social Security Administration of the name change,
please enter your first name, the last name shown on your social
security card, and your new last name.
OBTAINING A NUMBER
If you do not have a TIN, apply for one immediately. To apply,
obtain Form SS-5, Application for a Social Security Card, from
your local office of the Social Security Administration, or Form
SS-4, Application for Employer Identification Number, from your
local IRS office.
PAYEES AND PAYMENTS EXEMPT FROM BACKUP WITHHOLDING
The following is a list of payees exempt from backup withholding
and for which no information reporting is required:
(1) An organization exempt from tax under section 501(a), or
an individual retirement plan ("IRA"), or a custodial
account under section 403(b)(7), if the account satisfies
the requirements of Section 401(f)(2).
(2) The United States or any of its agencies or
instrumentalities.
(3) A state, the District of Columbia, a possession of the
United States, or any of their political subdivisions or
instrumentalities.
(4) A foreign government or any of its political
subdivisions, agencies or instrumentalities.
(5) An international organization or any of its agencies or
instrumentalities.
Other payees that may be exempt from backup withholding include:
(6) A corporation.
(7) A foreign central bank of issue.
(8) A dealer in securities or commodities required to
register in the United States, the District of Columbia,
or a possession of the United States.
(9) A futures commission merchant registered with the
Commodity Futures Trading Commission.
(10) A real estate investment trust.
(11) An entity registered at all times during the tax year
under the Investment Company Act of 1940.
(12) A common trust fund operated by a bank under section
584(a).
(13) A financial institution.
(14) A middleman known in the investment community as a
nominee or listed in the most recent publication of the
American Society of Corporate Secretaries, Inc., Nominee
List.
(15) A trust exempt from tax under section 664 or described in
section 4947.
For interest and dividends, all listed payees are exempt except
the payee in item (9). For broker transactions, all payees
listed in (1) through (13) and a person registered under the
Investment Advisers Act of 1940 who regularly acts as a broker
are exempt. Payments subject to reporting under sections 6041
and 6041A are generally exempt
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from backup withholding only if such payments are made to payees
listed in items (1) through (7). However, the following
payments made to a corporation and reportable on Form 1099-MISC
are not exempt from withholding:
. Medical and health care payments.
. Attorneys' fees.
. Payments for services paid by a federal executive
agency.
Payments of dividends generally not subject to backup
withholding include:
. Payments to nonresident aliens subject to
withholding under section 1441.
. Payments to partnerships not engaged in a trade or
business in the United States and that have at least
one nonresident partner.
. Payments of patronage dividends not paid in money.
. Payments made by certain foreign organizations.
. Section 404(k) distributions made by an ESOP.
Payments that are not subject to information reporting are also
not subject to backup withholding. For details, see sections
6041, 6041A, 6042, 6044, 6045, 6049, 6050A, and 6050N, and the
regulations under those sections. Payments of interest
generally not subject to backup withholding include:
. Payments of interest on obligations issued by
individuals.
Note: You may be subject to backup withholding if
this interest is $600 or more and is paid in
the course of the payor's trade or business
and you have not provided your correct TIN
to the payer.
. Payments of tax-exempt interest (including exempt-
interest dividends under section 852).
. Payments described in section 6049(b)(5) to
nonresident aliens.
. Payments on tax-free covenant bonds under section
1451.
. Payments made by certain foreign organizations.
. Mortgage interest paid by you.
PRIVACY ACT NOTICE. Section 6109 requires you to furnish your
correct TIN to persons who must file information returns with
the IRS to report interest, dividends, and certain other income
paid to you, mortgage interest you paid, the acquisition or
abandonment of secured property, or contributions you made to an
IRA. The IRS uses the numbers for identification purposes and
to help verify the accuracy of your tax return. The IRS may
also provide this information to the Department of Justice for
civil and criminal litigation and to cities, states and the
District of Columbia to carry out their tax laws. You must
provide your TIN whether or not you are qualified to file a tax
return. Payers must generally withhold 31% of taxable interest,
dividend, and certain other payments to a payee who does not
furnish a TIN to a payor. Certain penalties may also apply.
<PAGE>
PENALTIES
(1) Failure to Furnish TIN. If you fail to furnish your
correct TIN to a requester (the person asking you to
furnish your TIN), you are subject to a penalty of $50
for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
(2) Civil Penalty for False Information With Respect to
Withholding. If you made a false statement with no
reasonable basis that results in no backup withholding,
you are subject to a $500 penalty.
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(3) Criminal Penalty for Falsifying Information. Willfully
falsifying certifications or affirmations may subject you
to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE
IRS.
Guidelines for Determining the Proper Identification
Number to Give the Payer. Social Security numbers have nine
digits separated by two hyphens: i.e. 000-00-0000. Employer
identification numbers have nine digits separated by one hyphen:
i.e. 00-0000000. The table below will help determine the number
to give the payor.
<TABLE>
<CAPTION>
WHAT NAME AND NUMBER TO GIVE THE REQUESTER
<S> <C>
____________________________________________________________________________________
FOR THIS TYPE OF ACCOUNT: | GIVE NAME AND SOCIAL SECURITY NUMBER OF:
____________________________________________________________________________________
1. Individual | The individual
2. Two or more individuals | The actual owner of the account or, if
(joint account) | combined funds, the first individual on
| the account (1)
3. Custodian account of a minor | The minor(2)
(Uniform Gift to Minors Act) |
4. a. The usual revocable savings | The grantor-trustee(1)
trust (grantor is also trustee) |
b. So-called trust account that is | The actual owner(1)
not a legal or valid trust under|
state law |
5. Sole proprietorship | The owner(3)
____________________________________________________________________________________
FOR THIS TYPE OF ACCOUNT: | GIVE NAME AND EMPLOYER IDENTIFICATION
| NUMBER:
____________________________________________________________________________________
6. Sole proprietorship | The owner(3)
7. A valid trust, estate, or pension | The legal entity(4)
trust |
8. Corporate | The corporation
9. Association, club, religious, | The organization
charitable, educational, or other |
tax-exempt organization |
10.Partnership | The partnership
11.A broker or registered nominee | The broker or nominee
12.Account with the Department of | The public entity
Agriculture in the name of a public|
entity (such as a state or local |
government, school district, or |
prison) that receives agricultural |
program payments |
____________________________________________________________________________________
</TABLE>
(1) List first and circle the name of the person whose number
you furnish. If only one person on a joint account has a
social security number, that person's number must be
furnished.
(2) Circle the minor's name and furnish the minor's social
security number.
(3) Show your individual name, but you may also enter your
business name or "doing business as" name. You may use your
social security number or employer identification number.
(4) List first and circle the name of the valid trust, estate,
or pension trust. (Do not furnish the TIN of the personal
representative or trustee unless the legal entity itself is
not designated in the account title.)
Note: If no name is circled when there is more than one name
listed, the number will be considered to be that of the
first name listed.
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