Attached files
| file | filename |
|---|---|
| EX-31.3 - EX-31.3 CERTIFICATION OF CEO - MOUNTAIN NATIONAL BANCSHARES INC | c16223exv31w3.htm |
| EX-31.4 - EX-31.4 CERTIFICATION OF CFO - MOUNTAIN NATIONAL BANCSHARES INC | c16223exv31w4.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
(Amendment No. 1)
(Mark One)
| þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2010
or
| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number: 000-49912
MOUNTAIN NATIONAL BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
| Tennessee | 75-3036312 | |
| (State or other jurisdiction | (I.R.S. Employer Identification No.) | |
| of incorporation or organization) |
| 300 East Main Street, Sevierville, Tennessee | 37862 | |
| (Address of principal executive offices) | (Zip code) |
(865) 428-7990
(Registrant’s telephone number, including area code)
(Registrant’s telephone number, including area code)
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $1.00 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule
405 of the Securities Act. Yes o No þ
Indicate by check mark if the registrant is not required to file reports pursuant to Section
13 or 15(d) of the
Act. Yes o No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Website, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(of for such shorter period that the registrant was required to submit and post such files). Yes
o No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge,
in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large
accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act.
| Large accelerated filer o | Accelerated filer o | Non-accelerated filer o | Smaller reporting company þ | |||
| (Do not check if a smaller reporting company) |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of
the Act).
Yes o No þ
State the aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was last sold, or the
average bid and asked price of such common equity, as of the last business day of the registrant’s
most recently completed second fiscal quarter: $15,131,763.
There were 2,631,611 shares of Common Stock outstanding as of February 28, 2011.
DOCUMENTS INCORPORATED BY REFERENCE
None.
TABLE OF CONTENTS
Table of Contents
EXPLANATORY NOTE
Mountain National Bancshares, Inc. (the “Registrant”) is filing this Amendment No. 1 to its
Annual Report on Form 10-K/A (this “Amendment”) to amend Items 10 through 14 of Part III of its
Annual Report on Form 10-K for the fiscal year ended December 31, 2010 filed with the Securities
and Exchange Commission (the “Commission”) on April 13, 2011 (the “Original Filing”), to include
the information required by such items.
Except as otherwise expressly noted herein, this Amendment to Annual Report on Form 10-K/A
does not reflect events occurring after the April 13, 2011 filing of the Original Filing in any
way, except to reflect the changes discussed in this Amendment. Accordingly, this Amendment should
be read in conjunction with the Original Filing.
The Registrant does not undertake to update any information or disclosures in, or exhibits to,
the Original Filing to reflect events and circumstances occurring since the Original Filing. Such
matters will be addressed in subsequent reports filed with the Commission.
As a result of this Amendment, as required by Rule 12b-15 under the Securities Exchange Act of
1934, as amended, the Registrant is filing new certifications pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 by its principal executive officer and principal financial officer as
exhibits to this Amendment under Item 15 of Part IV hereof. Because no financial statements are
contained within this Amendment, the Registrant is not including the certifications pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Board of Directors
The Amended and Restated Bylaws of Mountain National Bancshares, Inc. (the “Company”) provide
that the Board of Directors shall consist of not less than five nor more than fifteen directors,
with the exact number to be fixed by resolution of the Board of Directors or the shareholders from
time to time and shall be divided into three classes, each class to consist, as nearly as may be
possible, of one-third of the total number of directors. The board currently consists of nine
members.
The information describing the current position and prior business experience of each of the
directors below contains information regarding the person’s service as a director, business
experience, public reporting company director positions held currently or at any time during the
last five years and the experiences, qualifications, attributes or skills that caused the Board of
Directors to determine that the person should serve as a director for the Company. Each of the
directors has served as a director of the Company since its inception in 2002 and as a director of
Mountain National Bank (the “Bank”) since 1998.
Table of Contents
Class I Directors (Term to expire at the 2013 Annual Meeting of Shareholders)
Gary A. Helton, age 50, has been the Owner and General Manager of Volunteer Chevrolet in
Sevierville, Tennessee since its opening in May 1994. In addition, he is also involved in many real
estate ventures, both commercial and residential. Mr. Helton is a member of the First Baptist
Church in Sevierville and a lifelong resident of Sevier County. He graduated with a B.S. Degree in
Business Management from Carson-Newman College in Jefferson City, Tennessee in 1982 and is a
graduate of the Leadership Sevier Class of 2001. Mr. Helton has extensive experience as a
successful small business owner and also provides the Board with expertise in matters relating to
commercial and residential real estate matters.
Jeffrey J. Monson, age 56, retired from TRW, a global automotive supply manufacturer, during
2006 after 27 years in various engineering and management positions in six plant locations. Mr.
Monson is a graduate of Purdue University with a Bachelor’s Degree in Mechanical Engineering and
served as an Officer in Purdue’s Mechanical Engineering Honorary Society. He also received a
Master’s Degree from Purdue’s Krannert Graduate School of Management. Mr. Monson attends First
United Methodist Church in Sevierville. In the past, he has served as a member of the United Way of
Sevier County Board of Directors and the Boys and Girls Club of the Smoky Mountains Board of
Directors. Mr. Monson is a graduate of the Leadership Sevier Class of 2002 and is past President of
the Sevier County High School Soccer Support Group. He is currently a member of the Holston United
Methodist Home for Children Board of Trustees. Mr. Monson also has commercial/residential real
estate interests in Greene and Sevier Counties in Tennessee. Mr. Monson’s engineering background
and business experience allows him to bring to the Board a broad understanding of a number of
industries in which many of the Company’s clients operate. He is also actively involved in a number
of community activities in the Company’s market area.
Charlie R. Johnson, age 69, is the Owner of Johnson-Murrell and Associates, P.C., a law firm
located in Sevierville, Tennessee, since 1976. His firm is involved primarily in business law, real
estate and estate administration. Mr. Johnson was an elected member of the Board of Mayor and
Alderman for the City of Sevierville from 1995 to 2003 and previously served as the Mayor of
Sevierville from 1987 to 1995. Mr. Johnson serves as consulting attorney for Signature Title of
Tennessee, LLC, a title and escrow closing company. He is an Owner and Vice-President of Oak Haven
Resort, Inc., a log cabin rental and development company. Mr. Johnson is a former member of the
Advisors of the Department of Geography at the University of Tennessee. He is a Deacon and Trustee
at the First Baptist Church of Sevierville, Tennessee and is a member of the Sevierville Lions
Club. He graduated from Tennessee Technological University with a Bachelor’s Degree in Political
Science and a Minor in Economics. He holds a Master’s Degree in Public Administration and a
Doctorate of Jurisprudence from the University of Tennessee at Knoxville. Mr. Johnson’s over 30
years of legal practice in the Sevier County, Tennessee area, during which he has represented a
broad array of corporate and municipal clients, contribute to the breadth and depth of experience
on the Board through the inclusion of a member with an understanding of a broad range of legal and
regulatory matters.
3
Table of Contents
Class II Directors (Term to Expire at 2011 Annual Meeting of Shareholders)
Sam L. Large, age 58, has been a promoter of the Gatlinburg Craftsmen’s Fairs since 1988.
Prior to that time, Mr. Large was Manager and Buyer for the Gatlinburg Craft Center and
Manager of Brookside Village. Mr. Large is the Owner of S.L.L., Inc., a real estate and
promotions firm, and Sam L. Large Construction. Mr. Large has an Associate Degree in Accounting and
Computer Programming. He has served on the Boards of Directors of the Gatlinburg Convention and
Visitors Bureau and the Gatlinburg Chamber of Commerce and has been President of both
organizations. Mr. Large has extensive experience as a small business owner in the communities that
the Company serves and is actively involved in a number of community activities in the Company’s
market area.
Linda N. Ogle, age 65, has been President of Riverside Motor Lodge, Inc. and Riverside Towers,
LLC for the past fifteen years. Ms. Ogle is involved in all aspects of the daily operations of her
businesses and has served in numerous civic and professional capacities. She is currently a member
of the Pigeon Forge United Methodist Church and a member of the Sevierville Noonday Rotary Club.
Previously, she was a member of the Board of Directors for the Boys and Girls Club of the Smoky
Mountains and past Chairperson for the Hotel Division of the United Way Campaign. She is currently
Campaign Chairperson for Fort Sanders Sevier Hospital, and is a graduate and past President of
Leadership Sevier Class of 1998, and a graduate of Leadership Knoxville and East Tennessee Regional
Leadership. Ms. Ogle is also a member of the Board of Directors for the Fort Sanders Foundation,
Friends of the Great Smoky Mountains, Covenant Health and Pigeon Forge Library. She also serves as
Secretary of the Walters State Foundation. Ms. Ogle has extensive experience as a successful small
business owner and is actively involved in a number of community activities in the Company’s market
area.
Michael C. Ownby, age 60, has been President of Ownby Insurance Service, Inc., an insurance
agency in Sevierville, Tennessee, since 1973. He is also Chief Manager of MSP Enterprises LLC,
which invests in various real estate ventures and stock investments. He is a 1973 graduate of the
University of Tennessee with a B.S. in Business Administration. Mr. Ownby is a member of First
Baptist Church in Sevierville, Tennessee where he has served as Sunday School Director, taught
Sunday School, and has served on various committees of the church. He is a past member of the
Sevierville Rotary Club. Mr. Ownby was previously a Director of the Sevierville Chamber of
Commerce; a Director of the Dr. Robert F. Thomas Foundation; a member of the Sevier County Kiwanis
Club; member of the Sevier County Jaycees; on the Board of Directors of the Insurors of Tennessee
and on the Board of Directors of the Sevier County Chapter of the Salvation Army. Mr. Ownby’s
experience provides the Board with critical experience in insurance matters. In addition, Mr. Ownby
provides the Board with his financial expertise as a successful small business owner.
Class III Directors (Term to Expire at 2012 Annual Meeting of Shareholders)
Dwight B. Grizzell, age 60, is the President/CEO and Director of the Company and the Bank. Mr.
Grizzell has 39 years of banking experience. Before becoming the Bank’s CEO, he served as Regional
President of BankFirst for Sevier County from 1996 through 1997. Prior to that he was the
President/CEO and Director of First National Bank of Gatlinburg. Mr. Grizzell began his career with
Third National Bank in Nashville in 1972. Mr. Grizzell held numerous managerial and administrative
positions with Third National Bank, First Security National Bank in Lexington, Kentucky and First
National Bank of Gatlinburg in Tennessee. He has served in numerous civic and professional
capacities and is a former member of the Tennessee Bankers Association Board of Directors. He has
been active with the Robert F. Thomas (“RFT”) Foundation including service as a Director on the
Board and as a committee member on the RFT
Hospital Steering Committee. He currently serves on the TBA Government Relations Committee;
and is State Director of the Independent Community Bankers Association (“ICBA”); and serves on the
National Board of Directors of ICBA. He is a member of the Leadership Sevier Class of 1998, and is
a member of the Great Smoky Mountains Church of Christ. Mr. Grizzell’s extensive experience in the
local banking industry and involvement in business and civic organizations in the communities in
which the Bank operates affords the Board valuable insight regarding the business and operation of
the Bank. Mr. Grizzell’s knowledge of all aspects of the Company’s and the Bank’s business position
him well to continue to serve as our President and Chief Executive Officer.
4
Table of Contents
John M. Parker, Sr., age 63, is a native of East Tennessee. Since arriving in the Sevier and
Jefferson County areas, he has participated in many business ventures including being one of the
original founders of Smoky Mountain Knife Works in Sevierville, Tennessee. Mr. Parker has also been
very involved in real estate development of several residential subdivisions in Sevier County and
many surrounding counties contributing to the growth of these areas. Mr. Parker has extensive
experience as a successful small business owner. In addition, Mr. Parker provides the Board with
additional expertise in matters relating to commercial and consumer real estate matters.
Ruth A. Reams, age 71, is retired from Reams Drug Store where she assisted her husband in the
operation of the family business for many years. She currently is serving as a Board Member on the
Dr. Robert F. Thomas Foundation Board, is a member of the Pigeon Forge Library Board and the Pigeon
Forge Lion’s Club, and is a graduate of Leadership Sevier Class of 2001. Ms. Reams has extensive
experience as a successful small business owner and is actively involved in a number of community
activities in the Company’s market area.
Audit Committee
The Company’s Board of Directors has a separately-designated standing Audit Committee
established in accordance with Section 3(a)(58)(A) of the Exchange Act, which also serves as the
Audit Committee for the Bank.
The Audit Committee consists of Michael C. Ownby (Chairman), Linda N. Ogle, John M. Parker and
Gary A. Helton, each of whom is an independent director under the applicable listing standards of
the Nasdaq Stock Market, LLC and the independence criteria set forth in Exchange Act Rule
10A-3(b)(1). The Audit Committee oversees and reviews the internal and independent audit function
of the Company and the Bank and reports the Committee’s findings and recommendations to the Board
of Directors. The Company’s Audit Committee has not adopted a written Audit Committee Charter. The
Board of Directors has determined that none of the members of the Audit Committee satisfies all of
the criteria that are necessary for such individual to qualify as an audit committee financial
expert under applicable SEC rules. However, the Board of Directors believes that each member of the
Audit Committee is financially literate and, through their various business experiences, is
well-qualified to perform the functions that are required as a member of the Audit Committee. The
Board of Directors further believes that the current members of the Company’s Board of Directors
provide a breadth of experience and level of community relationships that are important to the
Company, and the Company does not believe that it could attract an additional director who meets
the requirements of an “audit committee financial expert” who also has those similar relationships.
In making its
determination, the Board of Directors particularly considered the size and nature of the
Company’s business and the importance of knowledge of the local communities served by the Bank.
Therefore, the Board of Directors does not believe it is necessary at this time to seek a new
member who would qualify as an audit committee financial expert.
5
Table of Contents
Code of Ethics
The Company has adopted a code of ethics applicable to all directors, officers and employees,
which is available without charge, upon written request to Mountain National Bancshares, Inc. c/o
Corporate Secretary, 300 E. Main Street, Sevierville, Tennessee 37862. This code contains
provisions consistent with the SEC’s description of a code of ethics. The Company intends to
disclose any legally required amendments to, or waivers from, the code of conduct with respect to
its directors and officers in accordance with the rules and regulations of the SEC and the Nasdaq
Stock Market, LLC.
Executive Officers
Michael L. Brown, age 52, serves as Executive Vice President — Chief Operating Officer of the
Company and the Bank. Mr. Brown has been with the Company since its inception in 2002 and with the
Bank since 1998. Prior to joining the Bank, Mr. Brown served as a Senior Vice President of First
National Bank of Gatlinburg from 1995 to 1997, which later was acquired by BankFirst where he
continued to serve in that capacity until joining Mountain National Bank in 1998. Mr. Brown has a
combined banking career spanning 29 years, beginning with First Federal Savings Bank in Maryville,
Tennessee in 1981. He is a graduate of the University of Tennessee and the Graduate School of
Banking at LSU. He has served in several civic and professional organizations during his career.
Mr. Brown is currently a member of the Sevierville Rotary Club, and is a graduate of Leadership
Sevier, as well as Leadership Blount County. He is currently serving on the Payments and
Technology Committee of the Independent Community Bankers of America. Mr. Brown and his family are
active members of East Maryville Baptist Church.
Grace D. McKinzie, age 58, serves as Executive Vice President — Chief Lending Officer of the
Company and the Bank. Ms. McKinzie has been with the Company since its inception in 2002 and with
the Bank since 1998. Ms. McKinzie began her banking career with The First National Bank of
Gatlinburg in 1974 where she served as Vice President and was a commercial lender in the Gatlinburg
market. She is a graduate of Gatlinburg Pittman High School and the Tennessee Bankers Commercial
Lending School at Vanderbilt University. Ms. McKinzie was the 2006 American Business Women’s
Associate of the Year. She was a graduate of the 2007 Leadership Sevier Class.
There are no family relationships between any director or executive officer and any other
director or executive officer of the Company.
6
Table of Contents
Section 16(A) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company’s directors and executive officers, and
persons who beneficially own more than 10% of any class of the Company’s equity securities, to file
with the SEC initial reports of beneficial ownership and reports of changes in
beneficial ownership of the Common Stock. Such persons are required to furnish the Company
with copies of all Section 16(a) reports that they file with the SEC. Based solely on its review of
copies of such reports received by it and written representations that no other reports were
required, the Company believes that all such filing requirements were complied with.
ITEM 11. EXECUTIVE COMPENSATION
Risk Assessment of Compensation Policies
The Board has reviewed our compensation policies as generally applicable to our employees and
believes that our policies do not encourage excessive and unnecessary risk taking, and that the
level of risk that they do encourage is not reasonably likely to have a materially adverse effect
on the Company.
Compensation of Named Executive Officers and Directors
Named Executive Officers. The following table sets forth information with respect to all
compensation paid or accrued in 2010 for Dwight B. Grizzell, the Company’s President and Chief
Executive Officer, Grace D. McKinzie, the Company’s Executive Vice President — Chief Lending
Officer and Michael L. Brown, the Company’s Executive Vice President — Chief Operating Officer. No
other executive officers of the Company were paid $100,000 or more in total compensation for
services provided during the year ended December 31, 2010.
2010 Summary Compensation Table
| Non-Equality | Non-Qualified | |||||||||||||||||||||||||||||||||||
| Stock | Option | Incentive Plan | Deferred | All Other | ||||||||||||||||||||||||||||||||
| Awards | Awards | Compensation | Compensation | Compensation | ||||||||||||||||||||||||||||||||
| Name and Principal Position | Year | Salary ($) | Bonus ($) | ($) | ($) | ($) | Earnings ($) (7) | ($) | Total ($) | |||||||||||||||||||||||||||
Dwight B. Grizzell,
President and Chief |
2010 | $ | 227,612 | $ | 250 | $ | — | $ | — | $ | — | $ | 163,849 | $ | 23,984 | (1) | $ | 415,695 | ||||||||||||||||||
Executive Officer |
2009 | 247,910 | 600 | — | — | — | 120,387 | 24,648 | (2) | 393,545 | ||||||||||||||||||||||||||
Grace D. McKinzie,
Executive Vice President |
2010 | 152,435 | 250 | — | — | — | 80,632 | 14,508 | (3) | 247,825 | ||||||||||||||||||||||||||
and Chief Lending Officer |
2009 | 159,697 | 5,600 | — | — | — | 86,188 | 19,343 | (4) | 270,828 | ||||||||||||||||||||||||||
Michael L. Brown,
Executive Vice President |
2010 | 153,119 | 250 | — | — | — | 45,248 | 15,298 | (5) | 213,915 | ||||||||||||||||||||||||||
and Chief Operating Officer |
2009 | 160,294 | 5,600 | — | — | — | 50,397 | 16,556 | (6) | 232,847 | ||||||||||||||||||||||||||
| (1) | Represents car allowance of $6,023, insurance premium of $8,061, and director fees of $9,900. |
|
| (2) | Represents car allowance of $7,440, insurance premium of $7,608, and director fees of $9,600. |
|
| (3) | Represents car allowance of $6,207, insurance premium of $7,179, subsidiary directors fees of $200, and 401(k) match of $922. |
|
| (4) | Represents car allowance of $6,141, insurance premium of $7,420, subsidiary directors fees of $800, and 401(k) match of $4,982. |
|
| (5) | Represents car allowance of $8,594, insurance premium of $6,504 and subsidiary directors fees of $200. |
|
| (6) | Represents car allowance of $7,729, insurance premium of $6,747, subsidiary directors fees of $800, and 401(k) match of $1,280. |
|
| (7) | The amounts in the column captioned “Non-Qualified Deferred Compensation Earnings” reflect the changes in the value of benefits
under each executive’s salary continuation agreement, the terms of which are described in more detail below. |
7
Table of Contents
Outstanding Equity Awards
The following table sets forth information with respect to outstanding equity awards as of the
end of the 2010 fiscal year.
Outstanding Equity Awards At 2010 Fiscal Year-End
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
| Equity | ||||||||||||||||||||||||||||||||||||
| Incentive | ||||||||||||||||||||||||||||||||||||
| Equity | Plan | |||||||||||||||||||||||||||||||||||
| Incentive | Awards: | |||||||||||||||||||||||||||||||||||
| Plan | Market | |||||||||||||||||||||||||||||||||||
| Equity | Awards: | or Payout | ||||||||||||||||||||||||||||||||||
| Incentive | Number of | Value of | ||||||||||||||||||||||||||||||||||
| Plan | Number | Market | Unearned | Unearned | ||||||||||||||||||||||||||||||||
| Awards: | of | Value of | Shares, | Shares, | ||||||||||||||||||||||||||||||||
| Number of | Number of | Shares | Shares | Units or | Units or | |||||||||||||||||||||||||||||||
| Number of | Securities | Securities | or Units | or Units | Other | Other | ||||||||||||||||||||||||||||||
| Securities | Underlying | Underlying | of Stock | of Stock | Rights | Rights | ||||||||||||||||||||||||||||||
| Underlying | Unexercised | Unexercised | Option | That | That | That | That | |||||||||||||||||||||||||||||
| Unexercised | Options | Unearned | Exercise | Option | Have Not | Have Not | Have Not | Have Not | ||||||||||||||||||||||||||||
| Options (#) | (#) | Options | Price | Expiration | Vested | Vested | Vested | Vested | ||||||||||||||||||||||||||||
| Name | Exercisable | Unexercisable | (#) | ($) | Date | (#) | ($) | (#) | ($) | |||||||||||||||||||||||||||
Dwight B. Grizzell |
65 | — | — | 11.53 | 11/25/13 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
122 | — | — | 17.21 | 11/16/14 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
180 | — | — | 17.26 | 11/22/14 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
180 | — | — | 17.26 | 12/16/14 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
884 | — | — | 17.29 | 01/04/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
174 | — | — | 20.68 | 01/18/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
75 | — | — | 20.80 | 01/20/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
180 | — | — | 20.66 | 01/31/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
180 | — | — | 22.82 | 03/15/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
227 | — | — | 20.72 | 03/26/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
76 | — | — | 20.84 | 06/27/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
39 | — | — | 20.30 | 09/01/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
180 | — | — | 20.66 | 09/02/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
16,970 | — | — | 20.73 | 09/08/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 7,137 | — | 20.73 | 09/09/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 868 | — | 20.73 | 09/23/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 237 | — | 20.75 | 10/26/15 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 59 | — | 22.66 | 01/09/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 20 | — | 23.16 | 03/10/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 14 | — | 21.41 | 03/14/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 59 | — | 23.09 | 03/16/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 726 | — | 23.53 | 03/20/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 23.68 | 03/24/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 730 | — | 23.73 | 04/06/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 22 | — | 26.45 | 07/03/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 23 | — | 26.56 | 07/03/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 56 | — | 25.75 | 08/25/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 82 | — | 26.03 | 09/08/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 13 | — | 24.41 | 09/11/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 20 | — | 25.96 | 09/12/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 59 | — | 25.37 | 09/13/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 116 | — | 25.84 | 09/18/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 26.03 | 09/29/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 13 | — | 24.32 | 10/02/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 28 | — | 26.69 | 10/04/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 116 | — | 25.79 | 10/12/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 128 | — | 25.46 | 11/21/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 25.44 | 11/22/16 | — | — | — | — | |||||||||||||||||||||||||||
8
Table of Contents
Outstanding equity awards table (continued):
Outstanding Equity Awards At 2010 Fiscal Year-End
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
| Equity | ||||||||||||||||||||||||||||||||||||
| Incentive | ||||||||||||||||||||||||||||||||||||
| Equity | Plan | |||||||||||||||||||||||||||||||||||
| Incentive | Awards: | |||||||||||||||||||||||||||||||||||
| Plan | Market | |||||||||||||||||||||||||||||||||||
| Equity | Awards: | or Payout | ||||||||||||||||||||||||||||||||||
| Incentive | Number of | Value of | ||||||||||||||||||||||||||||||||||
| Plan | Number | Market | Unearned | Unearned | ||||||||||||||||||||||||||||||||
| Awards: | of | Value of | Shares, | Shares, | ||||||||||||||||||||||||||||||||
| Number of | Number of | Shares | Shares | Units or | Units or | |||||||||||||||||||||||||||||||
| Number of | Securities | Securities | or Units | or Units | Other | Other | ||||||||||||||||||||||||||||||
| Securities | Underlying | Underlying | of Stock | of Stock | Rights | Rights | ||||||||||||||||||||||||||||||
| Underlying | Unexercised | Unexercised | Option | That | That | That | That | |||||||||||||||||||||||||||||
| Unexercised | Options | Unearned | Exercise | Option | Have Not | Have Not | Have Not | Have Not | ||||||||||||||||||||||||||||
| Options (#) | (#) | Options | Price | Expiration | Vested | Vested | Vested | Vested | ||||||||||||||||||||||||||||
| Name | Exercisable | Unexercisable | (#) | ($) | Date | (#) | ($) | (#) | ($) | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 28 | — | 26.09 | 12/04/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 20 | — | 25.29 | 12/05/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 23 | — | 25.10 | 12/27/16 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 183 | — | 24.79 | 01/11/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 6 | — | 24.94 | 01/12/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 76 | — | 24.96 | 01/17/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 13 | — | 23.26 | 01/22/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 6 | — | 24.94 | 01/31/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 662 | — | 25.93 | 02/22/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1 | — | 25.95 | 03/02/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 12 | — | 24.97 | 03/06/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 144 | — | 25.92 | 03/07/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 13 | — | 25.84 | 03/08/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 26 | — | 26.92 | 03/12/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 105 | — | 26.66 | 03/14/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 7 | — | 25.95 | 03/19/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 18 | — | 25.64 | 03/23/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1 | — | 25.84 | 04/03/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 192 | — | 25.72 | 04/04/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 51 | — | 26.07 | 04/10/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 38 | — | 26.42 | 04/12/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 5 | — | 25.84 | 04/13/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 45 | — | 25.93 | 04/17/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 80 | — | 26.79 | 05/09/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1 | — | 26.85 | 05/11/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 210 | — | 27.14 | 05/14/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 12 | — | 26.12 | 05/16/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 22 | — | 26.87 | 05/22/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 18 | — | 26.49 | 06/05/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 58 | — | 26.55 | 06/06/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 6 | — | 26.66 | 06/11/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 868 | — | 26.67 | 06/25/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 21 | — | 27.28 | 06/27/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 145 | — | 27.60 | 06/28/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 35 | — | 27.39 | 06/29/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 23 | — | 27.83 | 07/09/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1,553 | — | 27.71 | 07/10/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 6 | — | 27.85 | 07/16/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 95 | — | 27.47 | 07/18/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 212 | — | 27.63 | 07/24/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 15 | — | 27.06 | 07/25/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 294 | — | 27.90 | 07/30/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 426 | — | 27.92 | 07/31/17 | — | — | — | — | |||||||||||||||||||||||||||
9
Table of Contents
Outstanding equity awards table (continued):
Outstanding Equity Awards At 2010 Fiscal Year-End
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
| Equity | ||||||||||||||||||||||||||||||||||||
| Incentive | ||||||||||||||||||||||||||||||||||||
| Equity | Plan | |||||||||||||||||||||||||||||||||||
| Incentive | Awards: | |||||||||||||||||||||||||||||||||||
| Plan | Market | |||||||||||||||||||||||||||||||||||
| Equity | Awards: | or Payout | ||||||||||||||||||||||||||||||||||
| Incentive | Number of | Value of | ||||||||||||||||||||||||||||||||||
| Plan | Number | Market | Unearned | Unearned | ||||||||||||||||||||||||||||||||
| Awards: | of | Value of | Shares, | Shares, | ||||||||||||||||||||||||||||||||
| Number of | Number of | Shares | Shares | Units or | Units or | |||||||||||||||||||||||||||||||
| Number of | Securities | Securities | or Units | or Units | Other | Other | ||||||||||||||||||||||||||||||
| Securities | Underlying | Underlying | of Stock | of Stock | Rights | Rights | ||||||||||||||||||||||||||||||
| Underlying | Unexercised | Unexercised | Option | That | That | That | That | |||||||||||||||||||||||||||||
| Unexercised | Options | Unearned | Exercise | Option | Have Not | Have Not | Have Not | Have Not | ||||||||||||||||||||||||||||
| Options (#) | (#) | Options | Price | Expiration | Vested | Vested | Vested | Vested | ||||||||||||||||||||||||||||
| Name | Exercisable | Unexercisable | (#) | ($) | Date | (#) | ($) | (#) | ($) | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 421 | — | 27.90 | 08/01/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 260 | — | 27.66 | 08/07/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1,212 | — | 27.65 | 08/10/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 278 | — | 27.69 | 08/13/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 201 | — | 27.60 | 08/14/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 64 | — | 27.59 | 08/15/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 116 | — | 27.45 | 08/16/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1,368 | — | 28.57 | 08/17/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 58 | — | 28.44 | 08/20/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1,087 | — | 28.32 | 08/24/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 2,316 | — | 27.86 | 08/28/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 76 | — | 27.71 | 08/29/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 636 | — | 27.87 | 08/31/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 110 | — | 27.92 | 09/04/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1,279 | — | 27.85 | 09/05/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 2,387 | — | 27.85 | 09/06/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 6,863 | — | 27.42 | 09/07/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 64 | — | 27.45 | 09/10/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 128 | — | 26.68 | 10/23/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 64 | — | 25.01 | 11/21/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 14 | — | 24.14 | 12/03/17 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 22.85 | 02/20/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 21.75 | 03/04/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 30 | — | 20.90 | 04/08/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 75 | — | 20.95 | 05/01/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 20.75 | 05/02/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 67 | — | 20.75 | 05/02/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 21.50 | 07/10/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 19.50 | 08/08/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 180 | — | 20.00 | 08/22/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 735 | — | 16.88 | 11/04/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 1,021 | — | 17.37 | 11/17/18 | — | — | — | — | |||||||||||||||||||||||||||
Dwight B. Grizzell |
— | 638 | — | 17.00 | 12/17/18 | — | — | — | — | |||||||||||||||||||||||||||
10
Table of Contents
Employment Contracts, Termination of Employment and Change-in-Control Arrangements
The Company does not currently have an employment agreement with Dwight B. Grizzell. Effective
May 15 and May 28, 2009, respectively, the Company and the Bank entered into employment agreements
with G. Devon McKinzie and Michael L. Brown, each with a three year term. Under the terms of these
agreements, Ms. McKinzie serves as the Bank’s Executive Vice President and Chief Lending Officer
and Mr. Brown serves as the Bank’s Executive Vice President and Chief Operating Officer. The
President/CEO reviews and adjusts Ms. McKinzie’s and Mr. Brown’s base salary amounts annually. In
addition, Ms. McKinzie and Mr. Brown are entitled to participate in any employee benefit plan of
the Bank made available to the Bank’s regular full-time employees generally. Upon a change in
control of the Bank and upon the executive’s subsequent involuntary termination of employment
(other than for cause, death, disability or retirement) or voluntary termination following a change
in control following any demotion, loss of title, office or significant authority, reduction in
annual compensation or benefits, or relocation of principal place of employment, the executives
will be entitled to receive an amount equal to 2.99 times his or her “base amount” within the
meaning of 280G(b)(3) of the Internal Revenue Code of 1986. At December 31, 2010, this lump sum
payment would have equaled $448,800 and $448,800 for Ms. McKinzie and Mr. Brown, respectively.
Additionally, the executives would be entitled to the continuation of life, medical, dental and
disability coverage for three years. A “change in control” is defined in the Employment Agreements
to include, among other things, the acquisition by another person, or two or more persons acting as
a group, of at least fifteen but less than twenty-five percent of the Company’s Common Stock, and
the adoption by the Board of Directors of a resolution declaring that a change in control of the
Bank has occurred; a merger or consolidation in which the Company is not the surviving entity; and
a change in the composition of a majority of the Board of Directors within a specified period of
time.
Pursuant to the employment agreements, in the event the executive is terminated without cause,
the executive will be entitled to be paid for the remaining term of the contract. In the event of
death of the executive, the executive’s estate would be entitled to compensation due to the
executive through the last day of the calendar month in which his or her death occurred. If the
executive retires, the executive would be entitled to all benefits under any retirement plan of the
Bank and other plans to which the executive is a party. The agreements with the executives further
provide that in the event of termination he or she will be prohibited from competing with the Bank
for a period of 12 months in any county in which the Bank has a branch or main office or in any
county in which the Bank operates its banking business.
Pursuant to the terms of the Company’s Stock Option Plan, unless otherwise provided, all
outstanding options will become fully vested and exercisable in the event of a change in control or
certain other corporate transactions. A “change in control” is defined in the Stock Option Plan to
include, among other things, the acquisition by another person of more than twenty-five percent of
the total combined voting power of the Company’s outstanding Common Stock; a
change in the composition of a majority of the Board of Directors within a specified period of
time; a merger or consolidation in which the Company is not the surviving entity; and certain other
transactions. Mr. Grizzell’s stock option agreement contains an anti-dilutive provision under which
additional options are granted for the purchase of the number of shares necessary to bring the
total number of shares under such option equal to five percent of the total outstanding shares of
Common Stock of the Company. This provision expired December 28, 2008.
11
Table of Contents
The Bank has entered into Executive Salary Continuation Agreements with certain of its senior
executive officers, including Messrs. Grizzell and Brown and Ms. McKinzie, pursuant to which each
such executive officer (or his or her beneficiaries) is entitled to receive cash payments following
the executive’s termination of employment with the Bank under certain scenarios. Upon the
executive’s retirement date (which is the later of the December 31st nearest the
executive’s 65th birthday or his or her voluntary resignation of employment or discharge
by the Bank without cause prior to the executive’s 65th birthday), the Bank is required
to pay to the executive an amount equal to 60% of the executive’s average highest three years’ base
salary during the term of his or her employment with the Bank paid in twelve equal monthly
installments for a total of 240 months. If the executive dies prior to the 240th month,
the monthly installments will continue to be paid to the executive’s beneficiary for the remainder
of the 240-month period. If the executive dies prior to retirement, then his or her beneficiary is
entitled to receive the accrued balance of the executive’s account as of his or her death in a lump
sum payment. If the executive becomes disabled prior to his or her termination of employment, and
his or her employment is terminated as a result of his or her disability, the Bank is required to
pay the executive 100% of his or her accrued account balance on the termination date. The payment
shall commence either (i) 30 days following the termination date, in which case it shall be made in
equal monthly installments until the executive reaches age 65, if the Bank’s long term disability
policy does not offset for other employer disability payments; or (ii) if the policy does so
offset, 30 days following the first to occur of termination of the long term disability policy or
the executive reaching age 65, in which case the payment shall be made in 60 equal monthly
installments. If, prior to the executive’s retirement, early or otherwise, the executive is
terminated by the Bank without cause, then the Bank is required to pay the executive an amount
equal to the executive’s accrued account balance on the date of the termination multiplied by the
percentage in which the executive has vested in the benefit. This benefit is payable in a lump sum
within 30 days following the executive reaching age 65. If the executive retires from the Bank
prior to reaching age 65 but after reaching age 62, he or she is entitled to receive a payment from
the Bank equal to the executive’s accrued account balance on the date of his or her early
retirement multiplied by the percentage in which the executive has vested in the benefit, payable
in 60 equal monthly installments beginning 30 days following the executive’s early retirement. Each
of Messrs. Grizzell and Brown and Ms. McKinzie are 100% vested in the benefits payable to the
executive under the Executive Salary Continuation Agreements.
If, following a change of control (as defined in the Executive Salary Continuation
Agreements), the executive’s employment is terminated, either voluntarily by the executive, or
involuntarily, but without cause, by the Bank, then the Bank is required to pay to the executive an
amount equal to 60% of the executive’s average highest three years’ base salary during the term of
his or her employment with the Bank paid in twelve equal monthly installments for a total of 240
months. If the executive dies prior to the 240th month, the monthly installments will continue to
be paid to the executive’s beneficiary for the remainder of the 240-month period.
12
Table of Contents
Director Compensation for Fiscal 2010
Directors are paid $825 for each Company and Bank Board of Directors meeting. The Chairman of
the Board receives a fee of $1,750 for each Company and Bank Board of Directors meeting attended.
During the first quarter of 2010, fees paid for committee meetings were suspended and the directors
did not receive separate compensation for Executive Loan Committee and other Board committee
meetings attended through the end of the year. Prior to the suspension, each director received $225
for each Executive Loan Committee meeting attended and $180 for each other Board committee meeting
attended. There are no other arrangements pursuant to which any of the directors were compensated
during 2010 for any service provided as a director. The Company does not maintain any stock
awards, stock option, pension, retirement or deferred compensation plans in which directors may
participate. The following table sets forth the compensation of the Company’s directors for
services rendered during 2010.
| Non- | Non- | |||||||||||||||||||||||||||
| Equality | Qualified | |||||||||||||||||||||||||||
| Fees | Incentive | Deferred | ||||||||||||||||||||||||||
| earned or | Stock | Option | Plan | Compensation | All Other | |||||||||||||||||||||||
| paid in | awards | awards | Compensation | Earnings | Compensation | |||||||||||||||||||||||
| Name1 | cash ($) | ($) | ($) | ($) | ($) | ($)(3) | Total ($) | |||||||||||||||||||||
James Bookstaff (4) |
$ | 7,050 | — | — | — | — | $ | 254 | $ | 7,304 | ||||||||||||||||||
Charlie Johnson |
$ | 23,655 | — | — | — | — | $ | 280 | $ | 23,935 | ||||||||||||||||||
Gary A. Helton |
$ | 10,080 | — | — | — | — | $ | 73 | $ | 10,153 | ||||||||||||||||||
Sam L. Large |
$ | 11,205 | — | — | — | — | $ | 343 | $ | 11,548 | ||||||||||||||||||
Jeffrey J. Monson |
$ | 11,025 | — | — | — | — | $ | 28,663 | (2) | $ | 39,688 | |||||||||||||||||
Linda N. Ogle |
$ | 12,105 | — | — | — | — | $ | 192 | $ | 12,297 | ||||||||||||||||||
Michael C. Ownby |
$ | 10,125 | — | — | — | — | $ | 137 | $ | 10,262 | ||||||||||||||||||
John M. Parker, Sr. |
$ | 12,150 | — | — | — | — | $ | 169 | $ | 12,319 | ||||||||||||||||||
Ruth A. Reams |
$ | 11,700 | — | — | — | — | $ | 1,307 | $ | 13,007 | ||||||||||||||||||
| 1. | Dwight B. Grizzell, the Company’s chief executive officer, is not included in this table as he is also a named
executive officer of the Company and his compensation for service on the board of directors of the Company
is reflected in the Summary Compensation Table above. |
|
| 2. | All other compensation for Jeffrey J. Monson includes $28,562 for construction site inspections done on
behalf of the Bank and $101 related to an increase in the cash surrender value of a split dollar life insurance
policy. |
|
| 3. | For all directors other than Mr. Monson, represents an increase in the cash surrender value of a split dollar
life insurance policy. |
|
| 4. | Mr. Bookstaff resigned from the Company’s and the Bank’s Board of Directors effective September 1, 2010. |
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| ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS |
Outstanding Voting Securities of the Company and Principal Holders Thereof
The Company is authorized to issue up to 10,000,000 shares of Common Stock. At April 5, 2010,
the Company had 2,631,611 shares of Common Stock issued and outstanding.
The following table sets forth certain information with respect to the beneficial ownership,
as of March 31, 2011, of shares of Common Stock by (a) each of the Company’s directors, (b) the
Company’s named executive officers, and (c) all directors and executive officers of the Company as
a group, and the percentage of the outstanding shares of Common Stock represented thereby. The
Company is not aware of any person who beneficially owns more than five percent of the Company’s
outstanding common stock other than James E. Bookstaff. Except as otherwise noted, the Company
believes that each of the persons listed has sole investment and voting power with respect to the
shares included in the table.
| Number of Shares | Percent of | |||||||
| Name of Beneficial Owner | Beneficially Owned (1)(2) | Common Stock | ||||||
5% Stockholders: |
||||||||
James E. Bookstaff |
151,262 | 5.75 | % | |||||
3925 Nellie Street Pigeon Forge, TN 37863 |
||||||||
Directors: |
||||||||
Dwight B. Grizzell (3) |
72,034 | (4) | 2.71 | % | ||||
Gary A. Helton |
94,182 | (5) | 3.58 | % | ||||
Charlie R. Johnson |
44,747 | (6) | 1.70 | % | ||||
Sam L. Large |
66,831 | (7) | 2.54 | % | ||||
Jeffrey J. Monson |
69,620 | (8) | 2.65 | % | ||||
Linda N. Ogle |
90,853 | (9) | 3.45 | % | ||||
Michael C. Ownby |
30,378 | (10) | 1.15 | % | ||||
John M. Parker, Sr. |
108,693 | (11) | 4.13 | % | ||||
Ruth A. Reams |
38,235 | (12) | 1.45 | % | ||||
Named Executive Officers: |
||||||||
Michael L. Brown |
7,352 | (13) | 0.28 | % | ||||
Grace D. McKinzie |
34,171 | (14) | 1.30 | % | ||||
All Directors and executive officers
as a group (11 persons) (15) |
657,096 | 24.74 | % | |||||
| (1) | Information relating to beneficial ownership of Common Stock by directors is
based upon information furnished by each person using “beneficial ownership” concepts set
forth in rules of the Securities and Exchange Commission (the “SEC”) under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”). Under such rules, a person is deemed
to be a “beneficial owner” of a security if that person has or shares “voting
power” which includes the power to vote or direct the voting of each security, or
“investment power” which includes the power to dispose of or to direct the disposition of
such security. The person is also deemed to be a beneficial owner of any security of which
that person has a right to acquire beneficial ownership within 60 days. Under such rules,
more than one person may be deemed to be a beneficial owner of the same securities, and a
person may be deemed to be a beneficial owner of securities as to which he or she may
disclaim any beneficial ownership. Accordingly, nominees are named as beneficial owners of
shares as to which they may disclaim any beneficial interest. Except as indicated in other
notes to this table describing special relationships with other persons and specifying
shared voting or investment power, directors possess sole voting and investment power with
respect to all shares of Common Stock set forth opposite their names. |
|
| (2) | The aggregate number of shares includes shares of Common Stock that the
individual has the right to acquire on or before May 30, 2011, (60 days from March 31,
2011), through the exercise of options or warrants. The number of shares underlying options
or warrants that may be exercised as of May 30, 2011, is as follows: (i) Mr. Grizzell —
24,355 shares; and (ii) all directors and executive officers as a group (11 persons) —
24,355 shares. |
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Table of Contents
| (3) | Mr. Grizzell also serves as the Company’s President and Chief Executive Officer. |
|
| (4) | Includes 31,332 shares held jointly with spouse, 380 shares held solely by
spouse, 14,488 shares held in Mr. Grizzell’s IRA and 1,479 shares held by children. |
|
| (5) | Includes 4,689 shares held in Mr. Helton’s IRA. |
|
| (6) | Includes 123 shares held jointly with children, 11,460 shares held by children
and 3,188 shares held in Mr. Johnson’s IRA. |
|
| (7) | Includes 40,463 shares held jointly with spouse and 26,368 shares held in Mr.
Large’s IRA. |
|
| (8) | Includes 31,677 shares held by GCS Partnership, of which Mr. Monson holds a
partnership interest, 5,788 shares held in Mr. Monson’s IRA, 3,264 shares held in spouse’s
IRA account and 915 shares held jointly with spouse. |
|
| (9) | Includes 4,272 shares held in Ms. Ogle’s IRA. |
|
| (10) | Includes 555 shares held solely by spouse and 8,400 shares held in Mr. Ownby’s
IRA. |
|
| (11) | Includes 101,806 shares held jointly with spouse and 6,885 shares held jointly
with spouse and child. |
|
| (12) | Includes 4,410 shares held jointly with spouse, 9,236 shares held in Ms. Reams’
IRA account, 4,974 shares held in spouse’s IRA account and 5,096 shares held with
grandchildren. |
|
| (13) | Includes 3,238 shares held in Mr. Brown’s IRA, 1,912 shares held in spouse’s
IRA, 583 shares held solely by spouse and 252 shares held with children. |
|
| (14) | Includes 10,804 shares held in Ms. McKinzie’s IRA and 534 shares held solely by
spouse. Includes 20,420 shares pledged as security. |
|
| (15) | The address for each of the above-named executive officers and directors is c/o
Mountain National Bancshares, Inc., 300 Main Street, Sevierville, TN 37862 |
15
Table of Contents
Compensation Plan Information
The following table provides certain information about the Company’s equity compensation plan
as of December 31, 2010:
| Number of | ||||||||||||
| Number of | securities remaining | |||||||||||
| securities to be | available for | |||||||||||
| issued upon | future issuance under | |||||||||||
| exercise of | Weighted average | equity compensation | ||||||||||
| outstanding | exercise price of | plans (excluding | ||||||||||
| options, warrants | options, warrants | securities reflected | ||||||||||
| and rights | and rights | in column (a)) | ||||||||||
| Plan Category | (a) | (b) | (c) | |||||||||
Equity compensation plans approved
by security holders |
122,133 | $ | 21.50 | 381,264 | ||||||||
Equity compensation plans not
approved by security holders |
— | — | — | |||||||||
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Certain Relationships and Transactions
Certain of the directors and executive officers of the Company and the Bank, members of their
families and companies or firms with which they are associated, were customers of and had banking
transactions with the Bank, in the ordinary course of business during 2010, and such transactions
are expected to continue in the future. All loans and lending commitments included in such
transactions were made on substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other persons and, in the opinion of
management, did not involve more than a normal risk of collectability or present other unfavorable
features. None of such loans outstanding to directors or officers of the Company, members of their
families or companies or firms with which they are associated was non-performing as of December 31,
2010. Total loans outstanding to all directors and executive
officers of the Company and the Bank, or affiliates of such persons (including members of the
immediate families of such persons or companies in which such persons had a 10% or more beneficial
interest), amounted to an aggregate of $13,447,959 at December 31, 2010.
Related party transactions between the Company or the Bank and the directors or executive
officers are approved in advance by the Company’s or the Bank’s Board of Directors.
The Board has determined that each of the following directors is an “independent director”
within the meaning of Marketplace Rule 5605(a)(2) of the Nasdaq Stock Market, LLC:
Gary A. Helton;
|
Charlie R. Johnson; | ||
Sam L. Large;
|
Mike Ownby; | ||
Linda N. Ogle;
|
John M. Parker, Sr.; and | ||
| Ruth Reams. |
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Table of Contents
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Crowe Horwath LLP (“Crowe Horwath”) served as the Company’s and the Bank’s independent
registered public accounting firm for the fiscal year ended December 31, 2010. The Company has
been advised that no member of Crowe Horwath or any associates have any financial interest in the
Bank.
During the years ended December 31, 2010 and December 31, 2009, the Company incurred the
following principal independent registered public accounting firm fees:
| 2010 | 2009 | |||||||
Audit Fees (a) |
$ | 223,259 | $ | 179,524 | ||||
Audit-Related Fees (b) |
0 | 15,009 | ||||||
Tax Fees (c) |
56,025 | 33,550 | ||||||
All Other Fees (d) |
0 | 4,643 | ||||||
| (a) | Includes fees related to the annual independent audit of the Company’s financial
statements and reviews of the Company’s annual report on Form 10-K, quarterly reports on
Form 10-Q, and services that are normally provided in connection with statutory and
regulatory filings or engagements for these years. |
|
| (b) | Fees incurred were for assurance and related services that are reasonably related to the
performance of the audit or review of the Company’s financial statements but are not
reported under “Audit Fees” above The Audit Committee has considered whether the provision
of these services is compatible with maintaining the independence of Crowe Horwath. |
|
| (c) | Fees incurred were for tax preparation and other tax advisory services relating to the
Company and its subsidiaries. |
|
| (d) | Fees incurred were for products and services other than those described above, primarily
database licensing fees. The Audit Committee has considered whether the provision of these
services is compatible with maintaining the independence of Crowe Horwath. |
The Audit Committee pre-approves in advance the terms of all audit services provided to
the Company as well as all permissible audit-related and non-audit services to be provided by the
Company’s independent auditors. All services set forth above under the captions “Audit Fees,”
“Audit-Related Fees,” “Tax Fees” and “All Other Fees” were approved by the Company’s Audit
Committee pursuant to SEC Regulation S-X Rule 2.01(c)(7)(i).
17
Table of Contents
PART IV
| ITEM 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES |
The following documents are being filed as part of this report on Form 10-K/A:
|
(b) Exhibits
| Exhibit No. | Description of Exhibit | |||
| 2.1 | Plan of Reorganization dated March 28, 2003, by and between the Company and
Mountain National Bank (included as Exhibit 2.1 to the Report on Form
8-K12G3 of the Company, dated July 12, 2003 (File No. 000-49912),
previously filed with the Commission and incorporated herein by reference). |
|||
| 2.2 | Amendment to Plan of Reorganization dated July 1, 2003 (included as Exhibit
2.2 to the Report on Form 8-K12G3 of the Company, dated July 12, 2003 (File
No. 000-49912), previously filed with the Commission and incorporated
herein by reference). |
|||
| 3.1 | Charter of Incorporation of the Company, as amended (Restated for SEC
filing purposes only) (included as Exhibit 3.1 to the Company’s
Registration Statement on Form S-1 (File No. 333-168281), previously filed
with the Commission and incorporated by reference herein). |
|||
| 3.2 | Amended and Restated Bylaws of the Company, as amended (included as Exhibit
3.1 to the Report on Form 8-K of the Company, dated March 31, 2010 (File
No. 000-49912), previously filed with the Commission and incorporated
herein by reference). |
|||
| 10.1 | Stock Option Plan of the Company, as amended (included as Exhibit 10.1 to
the Report on Form 8-K of the Company, dated May 19, 2006 (File No.
000-49912), previously filed with the Commission and incorporated herein by
reference)* |
|||
| 10.2 | Stock Option Agreement of Dwight B. Grizzell (assumed by Company) (included
as Exhibit 10.3 to the Company’s Form 10-KSB for the year ended December
31, 2002 and incorporated herein by reference)* |
|||
| 10.3 | Summary Description of Director and Named Executive Officer Compensation
Arrangements (included as Exhibit 10.3 to the Company’s Form 10-K for the
year ended December 31, 2010 and incorporated herein by reference)* |
|||
| 10.4 | Form of Warrant Agreement (included as Exhibit 10.5 to the Company’s Form
SB-2/A filed with the Commission on August 23, 2005) |
|||
| 10.5 | Employment Agreement dated as of May 15, 2009 by and among Mountain
National Bank, Mountain National Bancshares, Inc. and Grace McKinzie
(included as Exhibit 10.1 to the Report on Form 8-K of the Company, dated
March 31, 2010 (File No. 000-49912), previously filed with the Commission
and incorporated herein by reference)* |
|||
| 10.6 | Employment Agreement dated as of May 28, 2009 by and among Mountain
National Bank, Mountain National Bancshares, Inc. and Michael Brown
(included as Exhibit 10.2 to the Report on Form 8-K of the Company, dated
March 31, 2010 (File No. 000-49912), previously filed with the Commission
and incorporated herein by reference)* |
|||
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Table of Contents
| Exhibit No. | Description of Exhibit | |||
| 10.7 | Employment Agreement dated as of May 18, 2009 by and among Mountain
National Bank, Mountain National Bancshares, Inc. and Richard Hubbs
(included as Exhibit 10.3 to the Report on Form 8-K of the Company, dated
March 31, 2010 (File No. 000-49912), previously filed with the Commission
and incorporated herein by reference)* |
|||
| 10.8 | Amended and Restated Salary Continuation Agreement, dated January 19, 2007,
by and between Mountain National Bank and Dwight Grizzell. (included as
Exhibit 10.8 to the Company’s Form 10-K for the year ended December 31,
2007 and incorporated herein by reference)* |
|||
| 10.9 | Amendment, dated November 19, 2007, to Amended and Restated Salary
Continuation Agreement, by and between Mountain National Bank and Dwight
Grizzell. (included as Exhibit 10.9 to the Company’s Form 10-K for the year
ended December 31, 2007 and incorporated herein by reference)* |
|||
| 10.10 | Amended and Restated Salary Continuation Agreement, dated January 19, 2007,
by and between Mountain National Bank and Michael Brown. (included as
Exhibit 10.10 to the Company’s Form 10-K for the year ended December 31,
2007 and incorporated herein by reference)* |
|||
| 10.11 | Amendment, dated November 19, 2007, to Amended and Restated Salary
Continuation Agreement, by and between Mountain National Bank and Michael
Brown. (included as Exhibit 10.11 to the Company’s Form 10-K for the year
ended December 31, 2007 and incorporated herein by reference)* |
|||
| 10.12 | Amended and Restated Salary Continuation Agreement, dated January 19, 2007,
by and between Mountain National Bank and Grace McKinzie. (included as
Exhibit 10.12 to the Company’s Form 10-K for the year ended December 31,
2007 and incorporated herein by reference)* |
|||
| 10.13 | Amendment, dated November 19, 2007, to Amended and Restated Salary
Continuation Agreement, by and between Mountain National Bank and Grace
McKinzie. (included as Exhibit 10.13 to the Company’s Form 10-K for the
year ended December 31, 2007 and incorporated herein by reference)* |
|||
| 10.14 | Agreement, dated June 2, 2009, by and between Mountain National Bank and
the Office of the Comptroller of the Currency. (included as Exhibit 10.1 to
the Report on Form 8-K of the Company, dated June 5, 2009, (File No.
000-49912), previously filed with the Commission and incorporated herein by
reference) |
|||
| 21 | Subsidiaries of the Company (included as Exhibit 21 to the Company’s Form
10-K for the year ended December 31, 2010 and incorporated herein by
reference) |
|||
19
Table of Contents
| Exhibit No. | Description of Exhibit | |||
| 23 | Consent of Independent Registered Public Accounting Firm (included as
Exhibit 23 to the Company’s Form 10-K for the year ended December 31, 2010
and incorporated herein by reference) |
|||
| 31.1 | Certificate of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (included as Exhibit 31.1 to the Company’s Form 10-K for the year
ended December 31, 2010 and incorporated herein by reference) |
|||
| 31.2 | Certificate of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (included as Exhibit 31.2 to the Company’s Form 10-K for the year
ended December 31, 2010 and incorporated herein by reference) |
|||
| 31.3 | Certificate of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|||
| 31.4 | Certificate of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|||
| 32.1 | Certificate of CEO pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 (included as Exhibit 32.1 to the Company’s Form 10-K for the year
ended December 31, 2010 and incorporated herein by reference) |
|||
| 32.2 | Certificate of CFO pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 (included as Exhibit 32.2 to the Company’s Form 10-K for the year
ended December 31, 2010 and incorporated herein by reference) |
|||
| * | Denotes management contract or compensatory plan or arrangement. |
The Company is a party to certain agreements entered into in connection with the offering by
MNB Capital Trust I of an aggregate of $5,500,000 in trust preferred securities and the offering by
MNB Capital Trust II of an aggregate of $7,500,000 in trust preferred securities, as more fully
described in this Annual Report on Form 10-K. In accordance with Item 601(b)(4)(iii) of Regulation
S-K, and because the total amount of the trust preferred securities is not in excess of 10% of the
Company’s total assets, the Company has not filed the various documents and agreements associated
with the trust preferred securities herewith. The Company has, however, agreed to furnish copies of
the various documents and agreements associated with the trust preferred securities to the
Commission upon request.
20
Table of Contents
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
| MOUNTAIN NATIONAL BANCSHARES, INC. (Registrant) |
||||
| By: | /s/ Dwight B. Grizzell | |||
| Dwight B. Grizzell | ||||
| President and Chief Executive Officer Date: April 29, 2011 |
||||
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the capacities and on the
dates indicated.
/s/ Dwight B. Grizzell
Chief Executive Officer and Director |
Date: April 29, 2011 | |||
/s/ Richard A. Hubbs
Chief Financial Officer (Principal Financial and Accounting Officer) |
Date: April 29, 2011 | |||
/s/ Gary A. Helton
|
Date: April 29, 2011 | |||
/s/ Charlie R. Johnson
|
Date: April 29, 2011 | |||
/s/ Sam L. Large
|
Date: April 29, 2011 | |||
/s/ Jeffrey J. Monson
|
Date: April 29, 2011 | |||
/s/ Linda N. Ogle
|
Date: April 29, 2011 | |||
/s/ Michael C. Ownby
|
Date: April 29, 2011 | |||
/s/ John M. Parker
|
Date: April 29, 2011 | |||
/s/ Ruth Reams
|
Date: April 29, 2011 |
21